<PAGE>

EXHIBIT 10.18

                              EMPLOYMENT AGREEMENT


         This Employment Agreement (this "Agreement") is made as of
_____________, 2002, by Allis-Chalmers Corporation., a Delaware corporation (the
"Employer"), and V. William Archer, III, an individual resident in Houston,
Harris County, Texas (the "Executive").

                                 R E C I T A L S

         The Employer desires the Executive's employment with the Employer, and
the Executive wishes to accept such employment, upon the terms and conditions
set forth in this Agreement.

                                    AGREEMENT

         The parties, intending to be legally bound, agree as follows:

1.       DEFINITIONS
         -----------

         For the purposes of this Agreement, the following terms have the
meanings specified or referred to in this Section 1.

         "AGREEMENT"--this Employment Agreement.

         "BASIC COMPENSATION"--Salary and Benefits.

         "BENEFITS"--as defined in Section 3.1(b).

         "BOARD OF DIRECTORS"--the board of directors of the Employer.

         "CHANGE OF CONTROL"-for purpose of this Agreement, a "Change of
         Control" shall occur if (i) the Employer shall not be the surviving
         entity in any merger or consolidation (or survive only as a subsidiary
         of an entity other than a previously wholly-owned subsidiary of the
         Employer), (ii) the Employer sells, leases or exchanges or agrees to
         sell, lease or exchange all or substantially all of its assets to any
         other person or entity (other than a wholly-owned subsidiary of the
         Employer), (iii) the Employer is dissolved or liquidated, or (iv) any
         person or entity, including a "group" as contemplated by Section
         13(d)(3) of the Securities Exchange Act of 1934, (other than Energy
         Spectrum Partners, LP, Munawar H. Hidayatallah, Colebrooke Investments,
         Inc. or any of their respective affiliates) acquires or gains ownership
         or control of more than 50% of the outstanding capital stock of
         Employer after the date hereof, provided, however, any public offering
         by the Employer pursuant to the Securities Act of 1933, as amended, of
         capital stock of the Company or private placement of capital stock by
         the Employer shall not be deemed a "Change of Control" hereunder.

                                       1
<PAGE>

         "CONFIDENTIAL INFORMATION"--any and all:

                  (a) trade secrets concerning the business and affairs of the
         Employer and any other information, however documented, that is a trade
         secret within the meaning of law of the State of Texas; and

                  (b) information concerning the business and affairs of the
         Employer (which includes historical financial statements, financial
         projections and budgets, historical and projected sales, capital
         spending budgets and plans, the names and backgrounds of key personnel,
         personnel training and techniques and materials), however documented;
         and

                  (c) notes, analysis, compilations, studies, summaries, and
         other material prepared by or for the Employer containing or based, in
         whole or in part, on any information included in the foregoing.

         "DISABILITY"--as defined in Section 6.2.

         "EFFECTIVE DATE"--the date stated in the first paragraph of the
         Agreement.

         "EMPLOYMENT PERIOD"--the term of the Executive's employment under this
         Agreement.

         "FISCAL YEAR"--the Employer's fiscal year, as it exists on the
         Effective Date or as changed from time to time.

         "FOR CAUSE"--as defined in Section 6.3.

         "INCENTIVE COMPENSATION"--as defined in Section 3.2.

         "PERSON"--any individual, corporation (including any non-profit
         corporation), general or limited partnership, limited liability
         company, joint venture, estate, trust, association, organization, or
         governmental body.

         "POST-EMPLOYMENT PERIOD"--as defined in Section 8.2.

         "PROPRIETARY ITEMS"--as defined in Section 7.2(a)(iv).

         "SALARY"--as defined in Section 3.1(a).

2.       EMPLOYMENT TERMS AND DUTIES
         ---------------------------

         2.1      EMPLOYMENT
                  ----------

         The Employer hereby employs the Executive, and the Executive hereby
accepts employment by the Employer, upon the terms and conditions set forth in
this Agreement.

                                       2
<PAGE>

         2.2      TERM
                  ----

         Subject to the provisions of Section 6, the term of the Executive's
employment under this Agreement will be three years, beginning on the Effective
Date and ending on the third anniversary of the Effective Date.

         2.3      DUTIES
                  ------

         The Executive will have such duties as are assigned or delegated to the
Executive by the Board of Directors or Chief Executive Officer, and will
initially serve as Executive Vice President and Chief Financial Officer of the
Employer. The Executive will devote his entire business time, attention, skill,
and energy exclusively to the business of the Employer, will use his best
efforts to promote the success of the Employer's business, and will cooperate
fully with the Board of Directors in the advancement of the best interests of
the Employer. Nothing in this Section 2.3, however, will prevent the Executive
from engaging in additional activities in connection with personal investments
and community affairs that are not inconsistent with the Executive's duties
under this Agreement.

3.       COMPENSATION
         ------------

         3.1      BASIC COMPENSATION
                  ------------------

                  (a) SALARY. The Executive will be paid an annual salary of
$180,000.00, subject to adjustment as provided below (the "Salary"), which will
be payable in equal periodic installments according to the Employer's customary
payroll practices, but no less frequently than monthly. The Salary will be
reviewed by the Board of Directors or Chief Executive Officer not less
frequently than annually, and may be adjusted upward in the sole discretion of
the Board of Directors or Chief Executive Officer, but in no event will the
Salary be less than $180,000.00 per year.

                  (b) BENEFITS. The Executive will, during the Employment
Period, be permitted to participate in such pension, profit sharing, bonus, life
insurance, hospitalization, major medical, and other employee benefit plans of
the Employer that may be in effect from time to time, to the extent the
Executive is eligible under the terms of those plans (collectively, the
"Benefits").

         3.2      INCENTIVE COMPENSATION
                  ----------------------

         As additional compensation (the "Incentive Compensation") for the
services to be rendered by the Executive pursuant to this Agreement, the
Employer will pay the Executive up to twenty-five percent (25%) of Salary as
Incentive Compensation based on reaching the targets and goals for his position
as determined in advance and indicated in writing by the Chief Executive
Officer. Such goals and targets are to be established in writing of the Chief
Executive Officer prior to the beginning of each Fiscal Year. The Incentive
Compensation will be payable in cash or at the Executive's option in Employer's
stock if agreed to by the Board of Directors.

                                       3
<PAGE>

         3.3      STOCK OPTIONS
                  -------------

         The Employer has granted to Executive options to purchase 275,000
shares of Employer's common stock pursuant to Employer's 2002 Stock Incentive
Plan. The options granted to Executive will be subject to and governed by the
Employer's 2002 Stock Incentive Plan and an appropriate stock option agreement
containing such terms and provisions as the Board of Directors deem necessary.

4.       FACILITIES AND EXPENSES
         -----------------------

         4.1      GENERAL
                  -------

         The Employer will furnish the Executive office space in the
metropolitan Houston area, equipment, supplies, and such other facilities and
personnel as the Employer deems necessary or appropriate for the performance of
the Executive's duties under this Agreement. Executive will not be required to
relocate outside the metropolitan Houston, Texas area. The Employer will pay the
Executive's dues in such professional societies and organizations as the Chief
Executive Officer deems appropriate, and will pay on behalf of the Executive (or
reimburse the Executive for) reasonable expenses incurred by the Executive at
the request of, or on behalf of, the Employer in the performance of the
Executive's duties pursuant to this Agreement, and in accordance with the
Employer's employment policies, including reasonable expenses incurred by the
Executive in attending conventions, seminars, and other business meetings, in
appropriate business entertainment activities, and for promotional expenses. The
Executive must file expense reports with respect to such expenses in accordance
with the Employer's policies.

5.       VACATIONS AND HOLIDAYS
         ----------------------

         The Executive will be entitled to three (3) weeks paid vacation each
Fiscal Year in accordance with the vacation policies of the Employer in effect
for its executive officers from time to time. Vacation must be taken by the
Executive at such time or times as approved by the Chairman of the Board or
Chief Executive Officer. The Executive will also be entitled to the paid
holidays set forth in the Employer's policies. Vacation days and holidays during
any Fiscal Year that are not used by the Executive during such Fiscal Year may
not be used in any subsequent Fiscal Year.

6.       TERMINATION
         -----------

         6.1      EVENTS OF TERMINATION
                  ---------------------

          The Employment Period, the Executive's Basic Compensation and
Incentive Compensation, and any and all other rights of the Executive under this
Agreement or otherwise as an employee of the Employer will terminate (except as
otherwise provided in this Section 6):

                  (a) upon the death of the Executive;

                  (b) upon the disability of the Executive (as defined in
Section 6.2) immediately upon notice from either party to the other;

                                       4
<PAGE>

                  (c) for cause (as defined in Section 6.3), immediately upon
notice from the Employer to the Executive, or at such later time as such notice
may specify; or

                  (d) without cause, immediately upon notice from the Employer
to the Executive, or at such later time as such notice may specify;

                  (e) upon written notice from Employer that Employer has
elected to terminate this Agreement as a result of the breach of Employer's
financial covenants to its lenders; or

                  (f) upon written notice from Executive to Employer that the
Executive has elected to terminate this Agreement due to a Change of Control (as
defined herein).

         6.2      DEFINITION OF DISABILITY
                  ------------------------

         For purposes of Section 6.1, the Executive will be deemed to have a
"disability" if, for physical or mental reasons, the Executive is unable to
perform the Executive's duties under this Agreement for 120 consecutive days, or
180 days during any twelvemonth period, as determined in accordance with this
Section 6.2. The disability of the Executive will be determined by a medical
doctor selected by written agreement of the Employer and the Executive upon the
request of either party by notice to the other. If the Employer and the
Executive cannot agree on the selection of a medical doctor, each of them will
select a medical doctor and the two medical doctors will select a third medical
doctor who will determine whether the Executive has a disability. The
determination of the medical doctor selected under this Section 6.2 will be
binding on both parties. The Executive must submit to a reasonable number of
examinations by the medical doctor making the determination of disability under
this Section 6.2, and the Executive hereby authorizes the disclosure and release
to the Employer of such determination and all supporting medical records. If the
Executive is not legally competent, the Executive's legal guardian or duly
authorized attorney-in-fact will act in the Executive's stead, under this
Section 6.2, for the purposes of submitting the Executive to the examinations,
and providing the authorization of disclosure, required under this Section 6.2.

         6.3      DEFINITION OF "FOR CAUSE"
                  -------------------------

         For purposes of Section 6.1, the phrase "for cause" means: (a) the
Executive's breach of this Agreement following ten days notice to Executive and
failure to cure during such period thereof; (b) the Executive's failure to
adhere to any written Employer policy if the Executive has been given a
reasonable opportunity to comply with such policy or cure his failure to comply
(which reasonable opportunity must be granted during the ten-day period
preceding termination of this Agreement); (c) the appropriation (or attempted
appropriation) of a material business opportunity of the Employer, including
attempting to secure or securing any personal profit in connection with any
transaction entered into on behalf of the Employer; (d) the misappropriation (or
attempted misappropriation) of any of the Employer's funds or property; or (e)
the conviction of, the indictment for (or its procedural equivalent), or the
entering of a guilty plea or plea of no contest with respect to, a felony, the
equivalent thereof, or any other crime with respect to which imprisonment is a
possible punishment.

                                       5
<PAGE>

         6.4      TERMINATION PAY
                  ---------------

         Effective upon the termination of this Agreement, the Employer will be
obligated to pay the Executive (or, in the event of his death, his designated
beneficiary as defined below) only such compensation as is provided in this
Section 6.4. For purposes of this Section 6.4, the Executive's designated
beneficiary will be such individual beneficiary or trust, located at such
address, as the Executive may designate by notice to the Employer from time to
time or, if the Executive fails to give notice to the Employer of such a
beneficiary, the Executive's estate. Notwithstanding the preceding sentence, the
Employer will have no duty, in any circumstances, to attempt to open an estate
on behalf of the Executive, to determine whether any beneficiary designated by
the Executive is alive or to ascertain the address of any such beneficiary, to
determine the existence of any trust, to determine whether any person or entity
purporting to act as the Executive's personal representative (or the trustee of
a trust established by the Executive) is duly authorized to act in that
capacity, or to locate or attempt to locate any beneficiary, personal
representative, or trustee.

         (a)  TERMINATION BY THE EMPLOYER FOR CAUSE. If the Employer terminates
              this Agreement for cause, the Executive will be entitled to
              receive his Salary only through the date such termination is
              effective, but will not be entitled to any Incentive Compensation
              for the Fiscal Year during which such termination occurs or any
              subsequent Fiscal Year.

         (b)  TERMINATION UPON DISABILITY. If this Agreement is terminated by
              either party as a result of the Executive's disability, as
              determined under Section 6.2, the Employer will pay the Executive
              his Salary through the remainder of the calendar month during
              which such termination is effective and for the lesser of (i)
              three (3) consecutive months thereafter, or (ii) the period until
              disability insurance benefits commence under the disability
              insurance coverage furnished by the Employer to the Executive.

         (c)  TERMINATION UPON DEATH. If this Agreement is terminated because of
              the Executive's death, the Executive will be entitled to receive
              his Salary through the end of the calendar month in which his
              death occurs.

         (d)  TERMINATION BY EMPLOYER UPON BREACH OF FINANCIAL COVENANTS. If
              this Agreement is terminated by Employer because of the breach of
              financial covenants by Employer, the Executive will be entitled to
              receive his Salary through the calendar month such termination is
              effective and for 6 consecutive calendar months thereafter in
              accordance with the Employer's normal payroll practices.

         (e)  TERMINATION BY EMPLOYER WITHOUT CAUSE. If this Agreement is
              terminated by Employer without cause, the Executive will be
              entitled to receive his Salary through the term of this Agreement
              in accordance with normal payroll practices of the Employer, but
              will not be entitled to any Incentive Compensation for the Fiscal
              Year during which such termination occurs or any subsequent Fiscal
              Year.

         (f)  TERMINATION BY EXECUTIVE UPON CHANGE OF CONTROL. If this Agreement
              is terminated by Executive due to a Change of Control, the
              Executive will be entitled to receive his Salary for a period of
              one (1) year following such notice in accordance with normal
              payroll practices of the Employer, but will not be entitled to any

                                       6
<PAGE>

              Incentive Compensation for the fiscal Year during which such
              termination occurs or any subsequent Fiscal Year. Executive will
              not be entitled to any compensation hereunder if following
              Executive's termination pursuant to Section 6.1(f) of this
              Agreement, Executive is employed in any capacity by either the
              Employer or the person or entity which caused the Change of
              Control within a period of one year following notice of
              termination by Executive pursuant to Section 6.1(f) hereof. In the
              event that Executive terminates this Agreement pursuant to Section
              6.1(f) hereof and receives any payments under this Section 6.4(f)
              and is also employed by the Employer or the person or entity
              causing the Change of Control within one year of such termination,
              then Executive will immediately remit to Employer all payments
              made by Employer to Executive pursuant to this Section 6.4(f).

         (g)  BENEFITS. The Executive's accrual of, or participation in plans
              providing for, the Benefits will cease at the effective date of
              the termination of this Agreement, and the Executive will be
              entitled to accrued Benefits pursuant to such plans only as
              provided in such plans. The Executive will not receive, as part of
              his termination pay pursuant to this Section 6, any payment or
              other compensation for any vacation, holiday, sick leave, or other
              leave unused on the date the notice of termination is given under
              this Agreement.

7.       NON-DISCLOSURE COVENANT
         -----------------------

         7.1      ACKNOWLEDGMENTS BY THE EXECUTIVE
                  --------------------------------

         The Executive acknowledges that (a) during the Employment Period and as
a part of his employment, the Executive will be afforded access to Confidential
Information; (b) public disclosure of such Confidential Information could have
an adverse effect on the Employer and its business; and (c) the provisions of
this Section 7 are reasonable and necessary to prevent the improper use or
disclosure of Confidential Information.

         7.2      AGREEMENTS OF THE EXECUTIVE
                  ---------------------------

         In consideration of the compensation and benefits to be paid or
provided to the Executive by the Employer under this Agreement, the Executive
covenants as follows:

         Confidentiality.
         ---------------

                  (a) During and following the Employment Period, the Executive
will hold in confidence the Confidential Information and will not disclose it to
any person except with the specific prior written consent of the Employer or
except as otherwise expressly permitted by the terms of this Agreement.

                  (b) Any trade secrets of the Employer will be entitled to all
of the protections and benefits under the laws of the State of Texas and any
other applicable law. If any information that the Employer deems to be a trade
secret is found by a court of competent jurisdiction not to be a trade secret
for purposes of this Agreement, such information will, nevertheless, be


                                       7
<PAGE>

considered Confidential Information for purposes of this Agreement. The
Executive hereby waives any requirement that the Employer submit proof of the
economic value of any trade secret or post a bond or other security.

                  (c) None of the foregoing obligations and restrictions applies
to any part of the Confidential Information that the Executive demonstrates was
or became generally available to the public other than as a result of a
disclosure by the Executive.

                  (d) The Executive will not remove from the Employer's premises
(except to the extent such removal is for purposes of the performance of the
Executive's duties at home or while traveling, or except as otherwise
specifically authorized by the Employer) any document, record, notebook, plan,
model, component, device, or computer software or code, whether embodied in a
disk or in any other form (collectively, the "Proprietary Items"). The Executive
recognizes that, as between the Employer and the Executive, all of the
Proprietary Items, whether or not developed by the Executive, are the exclusive
property of the Employer. Upon termination of this Agreement by either party, or
upon the request of the Employer during the Employment Period, the Executive
will return to the Employer all of the Proprietary Items in the Executive's
possession or subject to the Executive's control, and the Executive shall not
retain any copies, abstracts, sketches, or other physical embodiment of any of
the Proprietary Items.

         7.3      DISPUTES OR CONTROVERSIES
                  -------------------------
         The Executive recognizes that should a dispute or controversy arising
from or relating to this Agreement be submitted for adjudication to any court,
arbitration panel, or other third party, the preservation of the secrecy of
Confidential Information may be jeopardized. All pleadings, documents,
testimony, and records relating to any such adjudication will be maintained in
secrecy and will be available for inspection by the Employer, the Executive, and
their respective attorneys and experts, who will agree, in advance and in
writing, to receive and maintain all such information in secrecy, except as may
be limited by them in writing.

8.       GENERAL PROVISIONS
         ------------------

         8.1      INJUNCTIVE RELIEF AND ADDITIONAL REMEDY
                  ---------------------------------------

         The Executive acknowledges that the injury that would be suffered by
the Employer as a result of a breach of the provisions of this Agreement
(including any provision of Section 7) would be irreparable and that an award of
monetary damages to the Employer for such a breach would be an inadequate
remedy. Consequently, the Employer will have the right, in addition to any other
rights it may have, to obtain injunctive relief to restrain any breach or
threatened breach or otherwise to specifically enforce any provision of this
Agreement, and the Employer will not be obligated to post bond or other security
in seeking such relief.

         8.2      COVENANTS OF SECTION 7 ARE ESSENTIAL AND INDEPENDENT COVENANTS
                  --------------------------------------------------------------

         The covenants by the Executive in Section 7 are essential elements of
this Agreement, and without the Executive's agreement to comply with such

                                       8
<PAGE>

covenants, the Employer would not have entered into this Agreement or employed
or continued the employment of the Executive. The Employer and the Executive
have independently consulted their respective counsel and have been advised in
all respects concerning the reasonableness and propriety of such covenants, with
specific regard to the nature of the business conducted by the Employer.

         The Executive's covenants in Section 7 is an independent covenant and
the existence of any claim by the Executive against the Employer under this
Agreement or otherwise, or against the Buyer, will not excuse the Executive's
breach of any covenant in Section 7.

         If the Executive's employment hereunder expires or is terminated, this
Agreement will continue in full force and effect as is necessary or appropriate
to enforce the covenants and agreements of the Executive in Section 7.

         8.3      REPRESENTATIONS AND WARRANTIES BY THE EXECUTIVE
                  -----------------------------------------------

         The Executive represents and warrants to the Employer that the
execution and delivery by the Executive of this Agreement do not, and the
performance by the Executive of the Executive's obligations hereunder will not,
with or without the giving of notice or the passage of time, or both: (a)
violate any judgment, writ, injunction, or order of any court, arbitrator, or
governmental agency applicable to the Executive; or (b) conflict with, result in
the breach of any provisions of or the termination of, or constitute a default
under, any agreement to which the Executive is a party or by which the Executive
is or may be bound.

         8.4      OBLIGATIONS CONTINGENT ON PERFORMANCE
                  -------------------------------------

         The obligations of the Employer hereunder, including its obligation to
pay the compensation provided for herein, are contingent upon the Executive's
performance of the Executive's obligations hereunder.

         8.5      WAIVER
                  ------

         The rights and remedies of the parties to this Agreement are cumulative
and not alternative. Neither the failure nor any delay by either party in
exercising any right, power, or privilege under this Agreement will operate as a
waiver of such right, power, or privilege, and no single or partial exercise of
any such right, power, or privilege will preclude any other or further exercise
of such right, power, or privilege or the exercise of any other right, power, or
privilege. To the maximum extent permitted by applicable law, (a) no claim or
right arising out of this Agreement can be discharged by one party, in whole or
in part, by a waiver or renunciation of the claim or right unless in writing
signed by the other party; (b) no waiver that may be given by a party will be
applicable except in the specific instance for which it is given; and (c) no
notice to or demand on one party will be deemed to be a waiver of any obligation
of such party or of the right of the party giving such notice or demand to take
further action without notice or demand as provided in this Agreement.

                                       9
<PAGE>

         8.6      BINDING EFFECT; DELEGATION OF DUTIES PROHIBITED
                  -----------------------------------------------

         This Agreement shall inure to the benefit of, and shall be binding
upon, the parties hereto and their respective successors, assigns, heirs, and
legal representatives, including any entity with which the Employer may merge or
consolidate or to which all or substantially all of its assets may be
transferred. The duties and covenants of the Executive under this Agreement,
being personal, may not be delegated.

         8.7      NOTICES
                  -------

         All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed to have been duly given when (a)
delivered by hand (with written confirmation of receipt), (b) sent by facsimile
(with written confirmation of receipt), provided that a copy is mailed by
registered mail, return receipt requested, or (c) when received by the
addressee, if sent by a nation-ally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and facsimile numbers as a
party may designate by notice to the other parties):

         If to Employer:            Allis-Chalmers Corporation
                                    7660 Woodway, Suite 200
                                    Houston, Texas 77063
                                    Attention:          Munawar H. Hidayatallah,
                                                        Chief Executive Officer
                                    Facsimile No.:      713-369-0555

         With a copy to:            Wilson, Cribbs, Goren & Flaum, P.C.
                                    440 Louisiana Street
                                    Suite 2200
                                    Houston, Texas 77002
                                    Attention:          Theodore F. Pound III
                                    Facsimile No.:      713-229-8824

         If to the Executive:       V. William Archer

                                    -------------------------
                                    -------------------------
                                    -------------------------
                                    Attention:          _______________
                                    Facsimile No.:      _______________

         With a copy to:
                                    -------------------------
                                    -------------------------
                                    -------------------------
                                    Attention:          _______________
                                    Facsimile No.:      _______________

                                       10
<PAGE>

         8.8      ENTIRE AGREEMENT; AMENDMENTS
                  ----------------------------

         This Agreement contains the entire agreement between the parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, between the parties hereto with respect to the
subject matter hereof. This Agreement may not be amended orally, but only by an
agreement in writing signed by the parties hereto.

         8.9      GOVERNING LAW
                  -------------

         This Agreement will be governed by the laws of the State of Texas
without regard to conflicts of laws principles.

         8.10     JURISDICTION
                  ------------

         Any action or proceeding seeking to enforce any provision of, or based
on any right arising out of, this Agreement may be brought against either of the
parties in the courts of the State of Texas, County of Harris, or, if it has or
can acquire jurisdiction, in the United States District Court for the Southern
District of Texas, and each of the parties consents to the jurisdiction of such
courts (and of the appropriate appellate courts) in any such action or
proceeding and waives any objection to venue laid therein. Process in any action
or proceeding referred to in the preceding sentence may be served on either
party anywhere in the world.

         8.11     SECTION HEADINGS, CONSTRUCTION
                  ------------------------------

         The headings of Sections in this Agreement are provided for convenience
only and will not affect its construction or interpretation. All references to
"Section" or "Sections" refer to the corresponding Section or Sections of this
Agreement unless otherwise specified. All words used in this Agreement will be
construed to be of such gender or number as the circumstances require. Unless
otherwise expressly provided, the word "including" does not limit the preceding
words or terms.

         8.12     SEVERABILITY
                  ------------

         If any provision of this Agreement is held invalid or unenforceable by
any court of competent jurisdiction, the other provisions of this Agreement will
remain in full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.

         8.13     COUNTERPARTS
                  ------------

         This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and all of which,
when taken together, will be deemed to constitute one and the same agreement.

                                       11
<PAGE>

         8.14     WAIVER OF JURY TRIAL
                  --------------------

         THE PARTIES HERETO HEREBY WAIVE A JURY TRIAL IN ANY LITIGATION WITH
RESPECT TO THIS AGREEMENT.

         IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date above first written above.


EMPLOYER:                                        ALLIS-CHALMERS CORPORATION



                                                 By:/S/ MUNAWAR H. HIDAYATALLAH
                                                    ---------------------------
                                                        Munawar H. Hidayatallah,
                                                        Chief Executive Officer


EXECUTIVE:                                       V. WILLIAM ARCHER, III



                                                 /S/ V. WILLIAM ARCHER, III
                                                 -------------------------------

                                       12