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> > > > > >                           UQM TECHNOLOGIES, INC. 

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made and entered into as of December 15, 2003, by and between
UQM TECHNOLOGIES, INC. f/k/a UNIQUE MOBILITY, INC., a corporation organized
under the laws of Colorado ("Employer"), and Donald A. French, an adult resident
of Aurora, Colorado ("Executive").

WHEREAS

, Executive is currently a party to an Employment Agreement with Employer dated
January 1, 2003 (the "Old Agreement"); and

WHEREAS

, Executive and Employer wish to replace the Old Agreement with this Agreement:

NOW, THEREFORE

, in consideration of the mutual promises, covenants and conditions hereinafter
set forth, Employer and Executive agree as follows:
         Termination of Old Agreement.
         Upon execution of this Agreement, the Old Agreement is hereby
         retroactively terminated, effective as of the date hereof.
         Employment.
         Employer hereby agrees to continue to employ Executive as its Treasurer
         and Chief Financial Officer for the term of employment set forth
         herein, and Executive hereby accepts such employment, all upon the
         terms and conditions hereinafter set forth.
         Duties.
         Executive shall perform the duties assigned to him by the Chief
         Executive Officer, subject to the control, supervision and direction of
         the Chief Executive Officer.
         Performance.
         During the term of Executive's employment under this Agreement and any
         renewal thereof, Executive shall devote Executive's best efforts and
         full working time and attention exclusively to the performance of the
         duties hereunder and to promoting and furthering the business of
         Employer, and shall not, during the term of employment, be engaged in
         any other business activity for personal pecuniary advantage. This
         paragraph shall not be construed as preventing Executive from investing
         Executive's assets in such form or manner as will not require any
         services on the part of Executive in the operation of the affairs of
         the companies in which such investments are made, subject to the
         provisions of Paragraph 17 hereof. Notwithstanding the foregoing,
         Executive may perform and assume other activities and obligations as
         the Board of Directors shall from time to time approve.
         Term of Employment, Expiration and Termination.
     1.  Subject to the provisions of Paragraphs 15 and 16, the term of
         employment of Executive pursuant to this Agreement shall commence on
         January 1, 2003, and shall continue through December 31, 2007 (the
         "Original Term of Employment").
     2.  Upon expiration of this Agreement, if Employer elects to not continue
         Executive's employment, Employer shall provide Executive notice of such
         fact and shall pay Executive: a lump sum equal to twenty-four (24)
         month's salary.
     3.  Upon expiration of this Agreement, if Employer elects to continue
         Executive's employment without a written employment agreement,
         Executive's employment shall be at will, except that Executive's
         employment may be terminated without cause by Employer after notice to
         Executive. Upon such termination Employer shall pay Executive: a lump
         sum equal to twenty-four (24) month's salary. For purposes of this
         paragraph, the requirement by Employer that Executive relocate
         Executive’s place of work by a distance greater than 40 miles, shall be
         considered a termination without cause by Employer entitling Executive
         to the benefits hereunder.
     4.  On termination of Executive's employment for cause during the Original
         Term of Employment pursuant to Paragraph 15(a), Executive shall receive
         no further salary.
     5.  On termination of Executive's employment without cause during the
         Original Term of Employment pursuant to Paragraph 15(c), Employer shall
         pay Executive a lump sum equal to twenty-four (24) months' salary. In
         the event of a material breach of this Agreement by Employer that is
         not cured after notice from Executive, Executive may elect to treat
         such breach as a constructive termination under this subparagraph
         entitling Executive to the benefits hereunder.
     6.  On termination of Executive's employment by Executive without cause
         either (i) during the Original Term of Employment pursuant to Paragraph
         16(b), or (ii) after expiration of the Original Term of Employment if
         Executive's employment continues without written agreement, Employer
         shall pay Executive a lump sum equal to three (3) month's salary, and
         Executive shall be entitled to no other severance benefits, except as
         provided under Subparagraph 5(k). Notwithstanding the foregoing, if
         Executive’s termination is under the provisions of Subparagraph 5(h)
         regarding voluntary retirement after the age of sixty-two years and six
         months or after twenty five (25) years of continuous service with
         Employer, the provisions of this Subparagraph 5(f) shall not be
         applicable and the provisions of Subparagraph 5(h) shall control.
     7.  If Executive's employment is terminated as a result of a hostile Change
         in Control (as defined below) of Employer, such termination shall be
         deemed a termination without cause under the provisions of Paragraph
         5(e), except that Executive shall receive a severance amount equal to
         twice any amount due under Paragraph 5(e). Any termination of Executive
         in contemplation of or within twelve (12) months after such Change in
         Control, except a termination for cause under Paragraph 15(a), shall be
         deemed a termination under this Subparagraph (g). Further, if
         Executive's position is materially changed by Employer in contemplation
         of or within twelve (12) months after any such Change in Control,
         including but not limited to, the required relocation by Employer of
         Executive’s place of work by a distance greater than 40 miles,
         Executive may elect to treat such change as a constructive termination
         under this subparagraph entitling Executive to the benefits hereunder.
         "Change of Control" means the election of new board members
         constituting a majority of the directors then in office, which new
         board members were not nominated by a majority of the directors in
         office on the date hereof.
     8.  Upon Executive's voluntary retirement after age sixty-two years and six
         months (62.5) or upon attaining twenty five (25) years of continuous
         service with Employer during or upon expiration of the Original Term of
         Employment, or any extension thereof, Executive shall receive the
         severance benefits described under Paragraph 5(e), i.e., as if the
         severance was a termination without cause by the Employer, except that
         the amount due shall be paid in two (2) equal installments; one-half
         (0.5) on termination and one/half (0.5) on the anniversary date of such
         termination. In order to exercise his rights under this
         Subparagraph 5(h), Executive shall provide Employer at least six (6)
         months’ prior written notice of his intent to do so.
     9.  Upon any termination of Executive, at Executive's election, Employer
         shall assign to Executive or Executive's designee any life and
         disability insurance policies or other fringe benefits which may so be
         assigned. Any continued cost of such policies or benefits shall be
         Executive's responsibility.
     10. Upon the expiration or termination of Executive's employment, Executive
         or Executive's legal representative upon request shall promptly deliver
         to Employer all originals and all duplicates or copies of all
         documents, records, notebooks and similar repositories of or containing
         Confidential Information as defined in Paragraph 18 then in his
         possession, whether prepared by Executive or not.
     11. Upon any termination of Executive’s employment under the provisions of
         Subparagraphs 5(b), (c), (e), (g) or (h), or Paragraph 10, Executive
         and his dependent(s) shall be entitled to continue to participate at
         Employer’s expense in Employer’s health care and hospitalization
         plan(s) until Executive has reached age 65. Notwithstanding the
         foregoing, upon the termination of Executive’s employment upon
         attaining twenty five (25) years of continuous service with Employer as
         provided for in Subparagraph 5 (h), unless Executive has also attained
         the age of sixty two and six months (62 .5), Executive and his
         dependents shall only be entitled to participate at Employer’s expense
         in Employer’s health care and hospitalization plan(s) for a period of
         three (3) months after the termination of Executive’s employment. Upon
         termination of Executive’s employment under the provisions of
         Subparagraph 5(f) (regarding termination of Executive’s employment by
         Executive without cause), Executive and his dependent(s) shall be
         entitled to continue to participate at Employer’s expense in Employer’s
         health care and hospitalization plan(s) for a period of three (3)
         months after the termination of Executive’s employment. Such benefit
         shall be in addition to, not in lieu of, any rights provided by law for
         Executive to continue to participate in Employer’s health care and
         hospitalization plan(s).

    Compensation.
    For the services to be rendered by Executive hereunder, Employer agrees to
    pay Executive during the term of employment, and Executive agrees to accept:
     a. An annual base salary of $173,000. Executive's annual base salary shall
        not be decreased during the Original Term of Employment.
     b. Executive's salary shall be paid in equal semi-monthly installments on
        the fifteenth and final day of each month during the term of his
        employment.
     c. Executive shall receive fringe benefits in accordance with Employer's
        policies and practices for employees generally (including, without
        limitation, participation in any stock option plans, life and disability
        insurance plans, health care and hospitalization plans, medical and
        dental reimbursement plans, profit sharing plans, retirement plans and
        other employee benefit plans) for which Executive is qualified. At
        Employer's expense Executive shall have a medical exam every year. In
        addition to the foregoing, Executive shall be provided the use of an
        automobile for combined business and personal use. The automobile shall
        be provided on similar or equivalent terms and conditions as exist for
        other executives who also may receive this benefit.
     d. During the last quarter of each fiscal year of Employment, Employer
        shall review Executive's performance under this Agreement and establish
        goals and objectives for Executive's performance for the next fiscal
        year. In such review, Employer, in its reasonable discretion, shall
        consider increasing Executive's salary and compensation based on
        relevant factors such as Executive's performance, Employer's
        accomplishments, increase or decrease in Executive's responsibilities,
        and cost of living increases. Any salary increases normally are to be
        effective on January 1 of each year.
     e. Employer has adopted a bonus plan to be administered by its Compensation
        Committee and in the Compensation Committee's discretion may award
        bonuses and stock options to Executive on terms to be determined by the
        Compensation Committee. As soon as practicable after the effective date
        of this Agreement, January 1, 2003, Executive shall receive an
        additional grant of options to purchase 70,000 shares at an exercise
        price determined based on the "Fair Market Value" of the stock, as
        defined under Employer's Stock Option Plan, on the date of the grant of
        the option.

    Working Facilities.
    Executive shall be furnished with appropriate office space, secretarial
    assistance, and such other facilities and services as are suitable to
    Executive's position and adequate for the performance of Executive's duties.
    Expenses.
    Employer shall reimburse Executive for all reasonable expenses that
    Executive incurs in connection with the business of Employer or any of its
    subsidiaries and in the performance of Executive's duties under this
    Agreement. Employer shall also reimburse Executive for membership fees and
    expenses related to Executive's membership in professional organizations,
    clubs, societies and groups as may be approved by the Board of Directors
    from time to time, subject to such rules, regulations and record-keeping
    requirements as may be established from time to time by the Board.
    Vacations.
    Executive shall be entitled each year to a vacation of four (4) weeks,
    during which time his compensation shall be paid in full. Vacation time
    accrued during each calendar year must be used by the end of each calendar
    year, or will be lost, and will not accrue from one calendar year to the
    next. Exceptions to the foregoing non-accrual policy may be provided under
    terms and conditions approved in writing by resolution of the Board of
    Directors or its compensation committee in such body's sole discretion based
    on prolonged extra-ordinary work demands preventing Executive's timely
    taking vacation.
    Disability.
    If Executive is unable to perform Executive's services by reason of illness
    or incapacity for a period of more than six (6) consecutive months, and
    subject to the provisions of Paragraph 11, Employer may terminate
    Executive's employment. Employer shall receive a credit against Executive's
    salary for any disability compensation benefit for the same calendar period
    received by Executive from Worker's Compensation or any commercial insurance
    carrier under Paragraph 11 while Executive is employed with the Employer. In
    the event Executive’s employment is terminated under this Paragraph 10,
    Executive shall receive the severance benefits described under Subparagraphs
    5(e) and 5(k),
    i.e.
    , as if the severance was a termination without cause by the Employer,
    except that the amount due shall be paid in two (2) equal installments,
    one-half (0.5) on termination and one-half (0.5) on the anniversary date of
    such termination.
    Insurance for the Benefit of Executive.
 1. Subject to the provisions of Paragraph 6(c), Executive shall be covered by
    Employer's medical and disability insurance in effect from time to time, the
    premiums for which shall be paid for by Employer.
 2. Employer shall at its expense continuously maintain without interruption in
    the name of Executive or Executive's designee or for the benefit of
    Executive or Executive's designee, life insurance coverage in an amount
    equal to Executive's then current salary for three (3) years.

Insurance for the Benefit of Employer. Employer shall have the right from time
to time to apply for and take out in its name and at its own expense, life,
health or other insurance upon Executive in any sum or sums which may be deemed
necessary by Employer to protect its interest under this Agreement and Executive
shall do all such things as may be necessary to assist in the procuring of such
insurance by making a proper application therefore as may be required by the
insurance company and submitting to the usual and customary medical
examinations. Executive, in Executive's capacity as Executive, shall have no
right, title or interest in or to such insurance, but the same shall be solely
for the benefit of Employer and any amounts payable thereunder shall be solely
payable to such Employer. Death During Employment. If Executive dies during the
term of his employment under this Agreement, Employer shall pay to the estate of
Executive the compensation which would otherwise be payable to Executive up to
the end of the third month after the month in which his death occurs. If, by
that time, Executive's estate has not received any proceeds of the insurance
provided for in Paragraph 11, Employer shall continue Executive's salary
hereunder for up to an additional three months, or until such insurance proceeds
are received, whichever is earlier ("Reimbursable Payments"), provided that
Executive's estate shall reimburse Employer for any such Reimbursable Payments
made from the proceeds of such insurance. Representation and Warranty. Executive
represents and warrants that he is not now, and will not be on the date of
commencement of this Agreement, a party to any agreement, contract or
understanding, whether of employment, agency or otherwise, which would in any
way restrict or prohibit Executive from undertaking and performing Executive's
duties in accordance with the terms and provisions of this Agreement.
Termination by Employer. Employer may terminate Executive's employment for
cause, which is defined as follows:
 i.   Fraud, malfeasance, or embezzlement against Employer's assets or
      conviction of any felony;
 ii.  Except under circumstances of disability contemplated by the provisions of
      Paragraph 10, cessation of Executive's performance of Executive's duties
      hereunder or deliberate and substantial failure to perform them in a
      capable and conscientious manner;
 iii. Violation of the provisions of Paragraph 14; or
 iv.  Deliberate and substantial breach of Executive's material obligations
      under any other provision hereof that is not cured within 30 days after
      notice to Executive of the breach.

Should the Board of Directors of Employer determine cause exists, as defined in
Subparagraph (a), to terminate Executive's employment, prior to termination for
such cause, Employer shall provide Executive written notice reasonably
describing the basis for the contemplated termination and a two-week period of
time in which to respond in writing and in person prior to Employer's final
determination of cause. During the period between such notice and final
determination, the Board may suspend the performance of Executive's duties under
this Agreement and direct Executive's non-attendance at work. However,
Executive's right to compensation under this Agreement shall continue through
and to any final termination of employment for cause. Employer may terminate
Executive's employment upon three (3) months notice without cause, subject to
the applicable provisions of Paragraph 5. During the period between such notice
and final determination, the Board may suspend the performance of Executive's
duties under this Agreement and direct Executive's non-attendance at work.
Termination by Executive. Executive shall have the right to terminate his
employment on forty-five (45) days' written notice to Employer of any default by
Employer in performing its duties under this Agreement, subject to the
provisions of Paragraph 5(e) and provided that Executive may not terminate his
employment if Employer cures the default within fifteen (15) days after
receiving such notice. Except as provided in Subparagraph 5(h) (requiring six
(6) months’ notice in the case of voluntary retirement), Executive may terminate
Executive's employment upon three (3) months notice without cause, subject to
the applicable provisions of Subparagraph 5(f). Restrictive Covenant. Executive
agrees and covenants that, without the Board's prior written consent and except
on behalf of Employer, he will not in any manner, directly or indirectly, own,
manage, operate, control, be employed by, participate in, assist or be
associated in any manner with any person, firm or corporation anywhere in the
world whose business competes with Employer or any subsidiary of Employer. This
covenant shall remain in effect until a date one (1) year after the date
Executive's employment is terminated or, if his employment is terminated
pursuant to Paragraph 16(a), until the termination date. Notwithstanding any
other provision of this Agreement, Executive may own up to three percent (3 %)
of the outstanding stock of a competing publicly traded corporation so long as
he takes no other action furthering the business of such corporation. Until a
date one (1) year after the termination date, Executive shall not (i) solicit
any other employee of Employer to leave the employ of Employer, or in any way
interfere with the relationship between Employer and any other employee of
Employer, or (ii) induce any customer, supplier, licensee, or other business
relation of Employer to cease doing business with Employer, or in any way
interfere with the relationship between any customer or business relation and
Employer. Confidentiality. Definitions. For purposes of this Agreement, the
following definitions shall apply:
"Inventions"
shall mean all inventions, improvements, modifications, and enhancements,
whether or not patentable, made by Executive within the scope of Executive's
duties during Executive's employment by Employer.
"Confidential Information"
shall mean Employers proprietary know-how and information disclosed by Employer
to Executive or acquired by Executive from Employer during Executive's
employment with Employer about Employer's plans, products, processes and
services, which Employer protects against disclosure to third parties.
Confidential Information shall not include the Executive's general knowledge and
experience possessed prior to or obtained during his employment with Employer.

Restrictions on Disclosure. During the period of employment with Employer and
thereafter, Executive shall not disclose Confidential Information to any third
parties other than Employer, its employees, agents, consultants, contractors and
designees without the prior written permission of Employer, or use Confidential
Information for any purpose other than the conduct of Employer's business. The
restrictions on disclosure and use set forth herein shall not apply to any
Confidential Information which:
 A. At the time of disclosure to Executive by Employer is generally available to
    the public or thereafter becomes generally known to the public, through no
    fault of Executive;
 B. Was known by Executive prior to his employment with Employer;
 C. Executive at any time receives from a third party not under any obligation
    of secrecy or confidentiality to Employer;
 D. Employer discloses to a third party not under any obligation of secrecy or
    confidentiality to it; and
 E. Executive is requested or required to disclose pursuant to a subpoena or
    order of a court or other governmental agency, in which case Executive shall
    notify Employer as far in advance of disclosure as is practicable.

Obligations Regarding Inventions. Without any royalty or any other additional
consideration to Executive: (i) Executive shall promptly inform Employer of any
Inventions by a written report, setting forth the conception and reduction to
practice of all inventions; (ii) Executive hereby agrees to assign and assigns
to Employer all of his right, title and interest: (1) to any Inventions made
during the term of his employment by Employer (including without limitation the
right to license or sell such Invention to others), (2) to applications for
United States and foreign letters patent, and (3) to United States and foreign
letters patent granted upon such Inventions; and (iii) Executive agrees upon
request and at the sole cost and expense of Employer to, at all times, do such
acts (such as giving testimony in support of his inventorship) and execute and
deliver promptly to Employer such papers, instruments, and documents as from
time to time may be necessary or useful to apply for, secure, maintaining,
reissue, extend or defend Employer's interest in any Inventions or any or all
United States and foreign letters patent, so as to secure Employer the full
benefits of any Inventions or discoveries or otherwise to carry into full force
and effect the intent of the assignment set out in subparagraph 18(c)(ii).
Remedies. Executive acknowledges and agrees that Executive's disclosure of any
Confidential Information would result in irreparable injury to Employer.
Executive acknowledges and agrees that the Confidential Information is
non-public information which Employee has expanded substantial time, money and
effort to develop and is property considered "Trade Secrets" of Employer within
the meaning of Colorado law. Therefore, upon the breach or threatened breach of
the covenants in this paragraph by Executive, Employer shall be entitled to
obtain from any court of competent jurisdiction a preliminary and permanent
injunction prohibiting such disclosure and any other equitable relief that the
court deems appropriate. In addition, Employer shall be entitled to seek
damages. Any Confidential Information that is directly or indirectly originated,
developed or perfected to any degree by Executive during the term of his
employment by Employer shall be and remain the sole property of Employer.
Resolution of Disputes. In addition to any other remedies available to Employer,
Employer shall be entitled to specific performance of the covenants contained in
Paragraphs 17 and 18. If either party is successful in enforcing its rights
under this Paragraph 19, the unsuccessful party shall reimburse the successful
party for all of the costs of such enforcement, including but not limited to
costs, litigation expenses and reasonable attorneys' fees. Except for an action
to interpret or enforce Paragraphs 17 or 18, any controversy or claim arising
out of or relating to the interpretation, alleged breach or enforcement of this
Agreement shall be settled by arbitration before a single arbitrator in Denver,
Colorado, in accordance with the commercial rules then in effect of the American
Arbitration Association, Colorado Revised Statutes pertaining to the arbitration
of civil disputes. The arbitrator, who shall be a person experienced in
negotiating and making employment agreements and resolving employment disputes
and in any other pertinent areas of law, shall make reasonably detailed findings
to support any decision and award. The award of the arbitrator shall be final
and binding and may be entered as a judgment in any court of competent
jurisdiction. As part of the award in any arbitration or judicial proceedings,
the prevailing party may be awarded its reasonable attorneys' fees, witness
fees, expert witness fees and related costs and expenses in the discretion of
the arbitrator. Notices. All notices under this Agreement shall be delivered by
hand or by registered or certified mail. Notices intended for Executive shall be
addressed to Executive at 21820 Cabrini Blvd., Golden, Colorado 80401. Notices
intended for Employer shall be addressed to it at 7501 Miller Drive, Frederick,
Colorado 80530. All notices shall be effective upon actual delivery if by hand,
or, if by mail, five (5) days after being deposited in the United States mail,
postage prepaid and addressed as required by this section. Either party may by
notice accomplished in accordance with this Paragraph 20 change the address to
which future notices may be sent. Miscellaneous Provisions. This Agreement
contains the entire agreement between the parties and supersedes all prior
agreements and it shall not be amended or otherwise modified in any manner
except by an instrument in writing executed by both parties. Neither this
Agreement nor any rights or duties under this Agreement may be assigned or
delegated by either party unless the other party consents in writing. Except as
otherwise provided herein, this Agreement shall be binding upon the inure to the
benefit of the parties and their respective heirs, personal representatives,
successors and assigns. This Agreement has been entered into in Colorado and
shall be governed by the laws of that state. In fulfilling their respective
obligations under this Agreement and conducting themselves pursuant to it, each
party shall act reasonably and in good faith. If any provisions of this
Agreement shall be held to be invalid or unenforceable for any reason, the
invalid or unenforceable provision shall be deemed severed from this Agreement
and the balance of this Agreement shall remain in full force and effect and be
enforceable in accordance with its terms.

 

 

 

 

IN WITNESS WHEREOF

, the parties have executed this Agreement the day and year first above written.

                                                                                                   
EXECUTIVE:

 

                                                                                                   
______________________________________

                                                                                                   
Donald A. French

 

                                                                                                   
EMPLOYER:  UQM TECHNOLOGIES, INC.

 

                                                                                                   
By: _________________________its President

                                                                                                         
William G. Rankin