EXHIBIT 10.1.23
                              EMPLOYMENT AGREEMENT

     This  Employment  Agreement (the  "Agreement") is entered into as of May 6,
2002,  by and between  Beacon Power  Corporation,  a Delaware  corporation  (the
"Company"), and Matthew Lazarewicz (the "Executive").

     WHEREAS,  the Company  desires to retain the services of the  Executive and
the Executive wishes to remain employed by the Company;

     WHEREAS,  the  Executive  and  the  Company  are  currently  parties  to an
Employment Agreement dated October 25, 2000 (the "Former Agreement");

     WHEREAS,  the Company and Executive  desire to enter into a new  Employment
Agreement  pursuant to the terms and  conditions  set forth below  following the
expiration of the Former Agreement on October 24, 2002;

     NOW,  THEREFORE,  for good and  valuable  consideration,  the  receipt  and
sufficiency of which are hereby acknowledged, the parties agree as follows:

     Section 1. Term. This Agreement shall be effective for a term commencing on
October 25, 2002  (provided  the Executive is an employee of the Company on that
date), and continuing for one year until  terminated  pursuant to Section 9. The
period of the Executive's employment hereunder is referred to as the "Employment
Period".

     Section 2. Duties. The Executive shall serve the Company as Chief Technical
Officer  and  shall  have  duties  and  responsibilities  consistent  with  such
position. The Executive will report to the President and Chief Executive Officer
of the  Company.  The  Executive  will  generally  perform  his  services at the
Company's  principal  offices,   which  are  currently  located  in  Wilmington,
Massachusetts,  provided,  however, that the Executive may be required to travel
from time to time in connection with Company business.

     Section 3. Full  Time;  Best  Efforts.  During  the  Employment  Period the
Executive shall use his best efforts to promote the interests of the Company and
shall devote his full business time and efforts to its business and affairs. The
Executive  shall not engage in any business  activity which could  reasonably be
expected to interfere with the performance of the Executive's  duties,  services
and responsibilities hereunder.

     Section 4. Compensation. The Executive shall be entitled to compensation as
follows:

     (a) Base Salary. During the Employment Period, the Executive will receive a
salary at an annual  gross rate of $157,500,  (as the same may be adjusted  from
time to time, the "Base Salary"),  which shall be payable in accordance with the
Company's  regular  payroll  practices.  The  Executive's  Base Salary  shall be
reviewed  by the  Board of  Directors  of the  Company  (the  "Board")  at least
annually and may be increased  (but not  decreased)  in the Board's  discretion,
depending upon the performance of the Executive and of the Company.

     (b) Bonus. The Executive shall be eligible to receive an annual bonus based
on the achievement of individual and Company performance objectives.  The amount
of the annual bonus will be targeted at 50% of the Executive's Base Salary,  but
will be granted solely at the discretion of the Board.

     (c) Withholding.  The Company may withhold from compensation payable to the
Executive all applicable federal,  state and local withholding taxes as required
by law.

     Section 5. Benefits

     (a) Generally.  The Executive  will be entitled to such fringe  benefits as
are generally  available to the Company's  executive  officers,  including group
health and dental  insurance  coverage,  group  long and  short-term  disability
insurance coverage,  and 401(k) plan and stock plan  participation.  The Company
shall not reduce in any material respect the benefits currently available to the
Executive  from the Company.  In the event that any  insurance  policy is paying
disability  benefits to Executive,  and if the amount of the Executive's monthly
base salary that would be paid in the absence of such  disability is higher than
the monthly insurance  payments,  then the Company shall pay Executive an amount
per month equal to such excess,  for so long as the  Executive is employed  with
the  Company.  No  such  difference  shall  be  payable  after  the  Executive's
employment is terminated with the Company.

     (b) Paid Vacation.  In addition to U.S. statutory  holidays,  the Executive
will be  entitled  to  twenty  (20)  business  days of paid  vacation  per year,
accruing  at the rate of 1.66 days per month.  A maximum of ten unused  vacation
days in any year may be carried over and used in the next year,  subject to such
policies as the Company may adopt from time to time with respect thereto.

     (c) Life Insurance.  The Company will provide the Executive with group term
life  insurance in an amount equal to no less than two times his Base Salary (up
to a maximum of $200,000) plus $250,000.

     Section  6.  Expense  Reimbursement.  The  Executive  will be  entitled  to
reimbursement of all reasonable and necessary  business expenses incurred by the
Executive in the ordinary  course of business on behalf of the Company,  subject
to  presentation  of  appropriate  documentation  and  compliance  with policies
established by the Board.

     Section  7.   Non-Disclosure   and   Assignment  of  Invention   Agreement:
Indemnification  Agreement.  The  Executive  shall  execute  and  deliver to the
Company the Company's standard form of Invention and Non-Disclosure Agreement.

     Section 8. Non-Competition and Non-Solicitation Covenants.

     (a)  Non-competition.  The Executive  agrees that his  employment  with the
Company for a period of twelve (12) months  thereafter,  he will no own, manage,
operate,  control, be employed by, provide services as an independent contractor
or consultant to, own any stock or other  investment in or debt of, or otherwise
be connected in any manner with the ownership,  management, operation or control
of, any business or enterprise that at the time of  termination,  completes with
the Company or conducts business in a field for which the Board has adopted plan
to enter.

     (b)  Non-Solicitation.  The  Executive  agrees that  during the  Employment
Period  and for one (1) year  thereafter,  he will not  attempt to  persuade  or
induce any employee of the Company to terminate his or her  employment  with the
Company for any reason.

     (c)  Acknowledgements  by Executive.  The Executive  acknowledges  that the
covenants set forth in this Section 8 are reasonable in scope and are no greater
than is necessary to protect the Company's  legitimate business  interests.  The
Executive further acknowledges that any breach by him of the covenants set forth
in this Section 8 would irreparably  injure the Company,  and that money damages
would not  adequately  compensate  the  Company for the  injuries  that it would
suffer.  The  parties  accordingly  agree  that in the  event of any  breach  or
threatened  breach by the  Executive of any of the  covenants  set forth in this
Section 8, the  Company may obtain,  from any court of  competent  jurisdiction,
both  preliminary  and  permanent  injunctive  relief  in order to  prevent  the
occurrence or  continuation  of such  injuries,  without being required to prove
actual  damages or post any bond or other  security.  Nothing in this  Agreement
shall  prohibit  the Company form  pursuing any other legal or equitable  remedy
that may be  available  to it in the  event  of the  Executive's  breach  of any
covenants set forth in this Agreement.


     Section 9. Termination.

     (a) Employment  Termination.  The  employment of the Executive  pursuant to
this Agreement shall terminate upon the occurrence of any of the following:

     (i) At the election of the  Company,  for Cause,  immediately  upon written
notice by the Company to the Executive. For purposes of this Agreement,  "Cause"
shall be deemed to exist upon a reasonable  good faith finding by the Board that
the Executive has:

     (1)  committed an act  constituting  fraud,  embezzlement  or other felony,
determined in the reasonable opinion of the Board acting in its sole discretion,
or

     (2)  materially  breached  his  obligations  under  this  Agreement  or the
Inventions  and  Nondisclosure  Agreement,  and  failed to cure the same  within
thirty (30) days after written notice thereof is given to him by the Company, or

     (3) materially breached the Company's material policies,  including but not
limited  to  the  Company's  policies  regarding  insider  trading,  and  sexual
harassment, or

     (4) engaged in willful misconduct.

     (ii) At the election of the Company,  without  Cause,  upon at least ninety
(90) days written notice by the Company to the Executive.

     (iii) The death of the Executive, or (in the discretion of the Company) the
Disability of the Executive. For purposes of this Agreement,  "Disability" shall
be considered to exist:

     (1) if the  Executive  fails to perform his normal  duties for at least 120
days, whether or not consecutive, during any 360-day period, or

     (2) if the Executive's  insurance company has confirmed that any disability
insurance benefits are going to be paid by reason of Executive's incapacitation,
or

     (3) if the  Board,  acting  in its  sole  discretion,  concludes  that  the
Executive suffers from a degree of physical or mental incapacitation as a result
of illness or accident  which makes it  reasonably  unlikely  that the Executive
will be able to perform his normal  duties for a period of 120 days. In reaching
this conclusion, the Board may consult third parties, including, but not limited
to, other employees, physicians, psychiatrists, and counselors.

     (iv) At the election of the Executive, for any reason, upon at least thirty
(30) days' prior written notice to the Company.

     (v) At the election of the  Executive  for Good Reason,  provided  that the
Executive shall have given written notice to the Company within thirty (30) days
after he becomes aware of the occurrence of any event of Good reason  specifying
such event,  and such event shall be continued  for a period of thirty (30) days
following such notice.  For purposes of this Agreement,  "Good Reason" means any
of the following events:

     (1) a material diminution in the duties, responsibilities,  position of job
title of the Executive without the Executive's written consent, or

     (2) a  material  breach  by the  Company  of  its  obligations  under  this
Agreement or Indemnification Agreement, or

     (3) a change in the primary  location  where the  Executive  is expected to
perform his services  hereunder to a location that is more than fifty (50) miles
away from Wilmington, Massachusetts, or

     (4) a Sale  of the  Business  (as  defined  below).  For  purposes  of this
Agreement,  a "Sale of the  Business"  means  (A) the  acquisition  by a person,
group, or party of 50% or more of the outstanding  capital stock of the Company,
(B) a change of a  majority  of the  members of the Board when the change of the
various directors occurs  substantially  the same time,  without the approval or
consent of the members of the Board before such change,  (C) the  acquisition of
the   Company   by   means   of   a   reorganization,   merger,   consolidation,
recapitalization  or asset sale,  unless the owners of the capital  stock of the
Company  before  such  transaction  continue to own more than 50% of the capital
stock  of  the  acquiring  or  succeeding   entity  in  substantially  the  same
proportions, or (D) the approval of a liquidation or dissolution of the Company.

     (vi) The expiration of the Agreement.

     (b) Effect of Termination.

     (i)  Termination  Pursuant to Section  9(a)(i)  relating to termination for
cause or Section  9(a)(iv)  relating to termination at the election of Executive
for any reason. In the event the Executive's  employment is terminated  pursuant
to Section 9(a)(i) or Section  9(a)(iv),  the Company shall pay to Executive his
accrued  Base Salary  through  the last date of his  employment  hereunder  (the
"Termination  Date") and shall continue to provide to the Executive the benefits
described in Section 5 (the "Benefits")  through the Termination Date, but shall
have no responsibility for any compensation or benefits to the Executive for any
time period subsequent to the Termination Date.

     (ii)  Termination  pursuant to Section  9(a)(ii)  relating  to  termination
without  casuse or Section  9(a)(v)  relating to  termination at the election of
Executive for Good Reason. In the event the Executive's employment is terminated
pursuant to Section 9(a)(ii) or Section 9(a)(v), the Company shall:

     (1) Within ten (10) business  days,  or as soon as is reasonably  possible,
after the Termination date, pay to the Executive a cash amount equal to his then
monthly  Base  Salary   multiplied  by  the  number  twelve  (12),   subject  to
withholdings required by law.

     (2)  Continue to provide  the  Benefits  to the  Executive  until the first
anniversary of the Termination Date.

     (3) Within ten (10) business  days,  or as soon as is reasonably  possible,
after the  Termination  date,  pay the  Executive  an amount  equal to his prior
year's bonus  multiplied by a fraction,  the numerator of which is the number of
full calendar  months that have elapsed in the then current  calendar year prior
to the  Termination  date,  and the  denominator  of which is twelve (12). In no
event,  shall  payment  under  this  Section   9(b)(ii)(3)  exceed  50%  of  the
Executive's prior year's base pay.

     (4) Amend the vesting  provisions  of any stock option  agreement  with the
Executive so that in the event of a termination  covered by this paragraph,  the
Executive's  then  unvested  options  would  vest  as of  the  Termination  Date
according to the following schedule:

                                                     Percentage acceleration
         If Termination occurs:                          of unvested options
|X|      Within first six months of employment                        0%
|X|      Within seven and twelve months of                           33%
         employment
|X|      After twelve full months of employment                      66%

     (iii) Termination  pursuant to Section  9(a)(iii)  relating to the death or
disability  of the  Executive.  In  the  event  the  Executive's  employment  is
terminated pursuant to Section 9(a)(iii), the Company shall:

     (1)  Continue to pay to  Executive  or his  estate,  as the case may be, an
amount  equal to his then  current  Base  Salary for the three (3) month  period
following the Termination Date.

     (2)  Continue for the twelve (12) month period  following  the  Termination
Date all health and dental  insurance  benefits the Executive was entitled to at
the Termination Date.

     (3) Amend the vesting  provisions  of any stock option  agreement  with the
Executive so that in the event of a termination  covered by this paragraph,  the
Executive's  then  unvested  options  would  vest  as of  the  Termination  Date
according to the following schedule:

                                                      Percentage acceleration
         If Termination occurs:                           of unvested options
|X|      Within first six months of employment                         0%
|X|      Within seven and twelve months of                            33%
         employment
|X|      After twelve full months of employment                       66%

     (iv) Golden Parachute Payment Excise Tax Protection.  In the event that the
excise tax imposed by Section  4999 of the  Internal  revenue  Code of 1986,  as
amended  (the  "Code"),  (or any  successor  penalty or excise tax  subsequently
imposed by law) applies to any payments of benefits paid or conferred under this
Agreement,  an  additional  amount shall be paid by the Company to the Executive
such that the aggregate  after-tax amount he shall receive under this Agreement,
including this Section 9(iv),  shall have a present value equal to the aggregate
after-tax  amount that he would have  received  and retained had such excise tax
not  applied to him.  For this  purpose,  the  Executive  shall be assumed to be
subject to tax in each year related to computation at the ten maximum applicable
combined Federal and Massachusetts income tax rate, and the determination of the
present value  payments to him shall be made  consistent  with the principles of
Section 280G of the Code.

     (c)  Continuation  /Nonrenewal.  Unless this  Agreement has been  otherwise
terminated  before  October 24,  2003,  the Company and the  Executive  agree to
discuss in good faith the possible  continuation of the Executive's  employment,
commencing  six months prior to October 24, 2003.  If the Company fails to offer
the Executive a new  employment  agreement,  with at least  equivalent  material
terms to this Agreement, by October 24, 2003 and in fact the Executive ceases to
be an employee of the company  following October 24, 2003, the Company shall pay
the  Executive a monthly  amount  until  October 24,  2004,  equal to the sum of
one-twelve  of the  Executive's  Base Salary in effect at the  expiration of the
Agreement plus  one-twelve of the  Executive's  bonus for the most recent fiscal
year of the Company, in accordance with the Company's regular payroll practices,
less  applicable  holdings  required by law. In the event the  Executive and the
Company  do not sign a new  employment  agreement  by October  24,  2003 but the
Executive's  employment with the Company continues on an at-will basis past that
date by  terminates  for any reason  before  October  24,  2004,  payment of the
foregoing  monthly amount will commence after such termination and continue only
until October 24, 2004. If the at-will  employment  continues  after October 24,
2004 but then terminates, no such monthly amount will be paid.

     Section  10.  No  Conflicting  Agreements.  The  Executive  represents  and
warrants  to  the  Company   that  he  is  not  a  party  to  or  bound  by  any
confidentiality,   non-competition,   non-solicitation  or  other  agreement  or
restriction  which could conflict with or be violated by the  performance of his
duties for the Company.

     Section 11. No Disparagement. Each party agrees that at all times following
the termination of the Executive's  employment  hereunder,  such party shall not
make or cause to be made,  directly or  indirectly,  any statements to any third
party  that  disparage  or  denigrate  the  other  party  or, in the case of the
Company, any of its current or former directors,  officers or employees,  unless
required by law.

     Section 12.  Enforceability.  This Agreement shall be interpreted in such a
manner as to be effective and valid under  applicable  law, but if any provision
hereof shall be prohibited or invalid under any such law, such  provision  shall
be  ineffective  to the  extent  of  such  prohibition  or  invalidity,  without
invalidating  or  nullifying  the  remainder  of  such  provision  or any  other
provisions of this Agreement.  If any one or more of the provisions contained in
this Agreement  shall for any reason be construed by limiting and reducing it so
as to be enforceable to the maximum extent permitted by applicable law.

     Section 13. Notices.  Any notice or other  communication  given pursuant to
this Agreement  shall be in writing and shall be personally  delivered,  sent by
nationally  recognized  overnight  courier or express  mail,  or mailed by first
class certified or registered mail, postage prepaid, return receipt requested as
follows:

  (a) If to the Executive:              (b) If to the Company:

      [address deleted]                     Beacon Power Corporation
                                            234 Ballardvale Street
                                            Wilmington, MA 01887
                                            Attn: Chief Executive Officer

     or to such address as a party shall have  designated by notice to the other
party.

     Section  14.  Governing  Law.  This  Agreement  shall  be  governed  by and
construed  in  accordance  with  the  internal  laws  of  the   Commonwealth  of
Massachusetts  without giving effect to any choice or conflict of laws provision
or rule that would cause the application of the domestic substantive laws of any
other jurisdiction.

     Section  15.  Amendments  and  Waivers.  No  amendment  or  waiver  of this
Agreement or any  provision  hereof shall be binding upon the party against whom
enforcement  of such  amendment or waiver is sought unless it is made in writing
and signed by or on behalf of such party. The waiver by either party of a breach
of any  provision of this  Agreement by the other party shall not operate and be
construed  as a waiver or a  continuing  waiver by that party of the same or any
subsequent breach of any provision of this Agreement by the other party.

     Section 16. Binding Effect. This Agreement shall be binding on and inure to
the benefit of the parties  hereto and their  respective  heirs,  executors  and
administrators,  successors  and assigns,  except that it may not be assigned by
the  Company  without the  Executive's  consent,  provided  that the Company may
assign this Agreement to an entity that acquires substantially all the Company's
assets by means of an asset sale,  merger or  otherwise,  provided  further that
such  entity  shall  agree in writing to assume and be bound by this  Agreement.
This Agreement is personal to the Executive and is not assignable by him.

     Section 17. Entire  Agreement.  This  Agreement  constitutes  the final and
entire  Agreement of the parties with respect to the matters  covered hereby and
replaces and supersedes all other agreements and understandings relating hereto.
The  Executive  expressly  acknowledges  that the Former  Agreement is no longer
valid and is of no force and effect following its expiration on October, 2002.

     Section  18.  Survivability.  Sections 8 and 12 herein  shall  survive  the
expiration and/or termination of this Agreement.

     Section 19. Pronouns.  Whenever the context may require,  any pronouns used
in this Agreement shall include the corresponding masculine,  feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural, and
vice versa.

     Section 20.  Counterparts.  This Agreement may be executed in any number of
counterparts  and with  counterpart  signatures  pages,  each of which  shall be
deemed an original,  but all of which together shall constitute one and the same
instrument.

     IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
as of the date first above written.


EXECUTIVE                                     BEACON POWER CORPORATION

_______________________                      By: _____________________________
Matthew L. Lazarewicz                            Signature
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