Document:

<PAGE>

EXHIBIT 10.19

                              EMPLOYMENT AGREEMENT

         This Employment Agreement (this "Agreement") is made as of April 1,
2002, by Allis- Chalmers Corporation., a Delaware corporation (the "Employer"),
and Jeffrey R. Freedman, an individual resident in Palm Beach Gardens, Florida
(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 - Chief Planning and Communications
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
$200,000.00, 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 $200,000.00 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.

                                       3
<PAGE>

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

         The Employer has granted to Executive options to purchase 300,000
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 a Stock Option Agreement between the
Employer and Executive containing such terms and provisions as the Board of
Directors deem necessary which will be executed concurrently with this
Agreement.

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

         4.1      GENERAL
                  -------

         The Employer will furnish the Executive office space, 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. The Employer will pay the Executive's dues in such professional
societies and organizations as the Chief Executive Officer deems appropriate.

         4.2      LIVING AND EXPENSE ALLOWANCE
                  ----------------------------

         It is understood that Executive resides in Palm Beach Gardens, Florida
and will commute to and from Houston, Texas. Initially in the first year of the
term hereof, Employer will pay to Executive $50,000.00 per year payable monthly
for all transportation, vehicle and living expenses necessary to perform his
duties in Houston, Texas. Such allowance will include all travel to and from
Houston, vehicle and living expenses while in Houston, but does not include
travel or lodging expense on Company business outside of Houston, Texas. The
purpose of the allowance is to pay all travel and living expenses of Executive
rather than reimbursement for expenses. Any expenses incurred by Executive for
transportation to and from Houston, vehicle and living expenses while in Houston
will be Executives responsibility and Employee will only be responsible for
payment of the allowance described above. The living and expense allowance
described in this Section 4.2 shall be for the first year of this Agreement and
shall be reviewed by Employer each year thereafter and may be changed or reduced
as deemed appropriate by Employer.

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.

                                       4
<PAGE>

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;

                  (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.

                                       5
<PAGE>

         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.

         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.

                                       6
<PAGE>

         (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 one calendar month thereafter.

         (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
              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:

                                       7
<PAGE>

         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
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
<PAGE>

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
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.

                                       9
<PAGE>

         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.

         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

                                       10
<PAGE>

         If to the Executive:       Jeffrey R. Freedman

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

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

         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.

                                       11
<PAGE>

         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.

         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:                                  JEFFREY R. FREEDMAN

                                            /S/ JEFFREY R. FREEDMAN
                                            -------------------------------

                                       12<PAGE>
EXHIBIT 10.20

                           ALLIS-CHALMERS CORPORATION
                            2002 INCENTIVE STOCK PLAN

1. PURPOSE. The purpose of the Allis-Chalmers Corporation ("Corporation")
Incentive Stock Plan (the "Plan") is to encourage key employees, directors and
service providers of the Corporation and such subsidiaries of the Corporation as
the Administrator designates to acquire common stock of the Corporation (the
"Common Stock") or to receive monetary payments based on the value of such stock
or based upon achieving certain goals on a basis mutually advantageous to such
individuals and the Corporation and thus provide an incentive to contribute to
the success of the Corporation and align the interests of key employees,
directors and service providers with the interests of the shareholders of the
Corporation.

2. ADMINISTRATION. The Plan shall be administered by a committee of two or more
directors, which the board of directors of the Corporation shall appoint (the
"Administrator"). The directors appointed to such committee shall be
disinterested persons as defined in Rule 16b-3 promulgated under the Securities
Exchange Act of 1934 ("Exchange Act") or any successor regulations.

The authority to select persons eligible to participate in the Plan, to grant
Benefits in accordance with the Plan, and to establish the timing, pricing,
amount and other terms and conditions of such grants (which need not be uniform
with respect to the various Participants or with respect to different grants to
the same Participant), may be exercised by the Administrator in its sole
discretion.

Subject to the provisions of the Plan, the Administrator shall have exclusive
authority to interpret and administer the Plan, to establish appropriate rules
relating to the Plan, to delegate some or all of its authority under the Plan
and to take all such steps and make all such determinations in connection with
the Plan and the Benefits granted pursuant to the Plan as it may deem necessary
or advisable.

The Board of Directors in its discretion may delegate and assign specified
duties and authority of the Administrator to any other committee and retain
other duties and authority. Also, the Board of Directors in its discretion may
appoint a separate committee of outside directors to make awards that satisfy
the requirements of Section 162(m) of the Internal Revenue Code.

3. SHARES RESERVED UNDER THE PLAN. Subject to the provisions of Section 12
(relating to adjustment for changes in capital stock) the maximum number of
shares that may be issued under this Plan shall not exceed the lesser of 10% of
the common stock outstanding from time to time and 2,500,000 shares of Common
Stock, which may be authorized but unissued or treasury shares.

As used in this Section 3, the term Plan Maximum shall refer to the number of
shares of Common Stock that are available for grant of awards pursuant to the
Plan. Stock underlying outstanding options, stock appreciation rights, or
performance awards will reduce the Plan Maximum while such options, stock
appreciation rights or performance awards are outstanding. Shares underlying
expired, canceled or forfeited options, stock appreciation rights or performance
awards shall be added back to the Plan Maximum. When the exercise price of stock
options is paid by delivery of shares of Common Stock, or if the Administrator
approves the withholding of shares from a distribution in payment of the
exercise price, the Plan Maximum shall be reduced by the net (rather than the

<PAGE>

gross) number of shares issued pursuant to such exercise, regardless of the
number of shares surrendered or withheld in payment. If the Administrator
approves the payment of cash to an optionee equal to the difference between the
fair market value and the exercise price of stock subject to an option, or if a
stock appreciation right is exercised for cash or a performance award is paid in
cash the Plan Maximum shall be increased by the number of shares with respect to
which such payment is applicable. Restricted stock issued pursuant to the Plan
will reduce the Plan Maximum while outstanding even while subject to
restrictions. Shares of restricted stock shall be added back to the Plan Maximum
if such restricted stock is forfeited.

4. PARTICIPANTS. Participants will consist of such officers, key employees,
directors and service providers of the Corporation or any designated subsidiary
as the Administrator in its sole discretion shall determine. Designation of a
Participant in any year shall not require the Administrator to designate such
person to receive a Benefit in any other year or to receive the same type or
amount of Benefit as granted to the Participant in any other year or as granted
to any other Participant in any year. The Administrator shall consider such
factors as it deems pertinent in selecting Participants and in determining the
type and amount of their respective Benefits.

5. TYPES OF BENEFITS. The following Benefits may be granted under the Plan: (a)
stock appreciation rights ("SARs"); (b) restricted stock ("Restricted Stock");
(c) performance awards ("Performance Awards"); (d) incentive stock options
("ISOs"); (e) nonqualified stock options ("NQSOs"); and (f) Stock Units, all as
described below ("Benefits").

The Administrator may (a) award Benefits in the alternative so that acceptance
of or exercise of one Benefit cancels the right of a Participant to another and
(b) award Benefits in any combination or combinations and subject to any
condition or conditions consistent with the terms of the Plan that the
Administrator in its sole discretion shall determine.

6. STOCK APPRECIATION RIGHTS. A SAR is the right to receive all or a portion of
the difference between the fair market value of a share of Common Stock at the
time of exercise of the SAR and the exercise price of the SAR established by the
Administrator, subject to such terms and conditions set forth in a SAR agreement
as may be established by the Administrator in its sole discretion. At the
discretion of the Administrator, SARs may be exercised (a) in lieu of exercise
of an option, (b) in conjunction with the exercise of an option, (c) upon lapse
of an option, (d) independent of an option or (e) each of the above in
connection with a previously awarded option under the Plan. If the option
referred to in (a), (b) or (c) above qualified as an ISO pursuant to Section 422
of the Internal Revenue Code of 1986 (Code), the related SAR shall comply with
the applicable provisions of the Code and the regulations issued thereunder. At
the time of grant, the Administrator may establish, in its sole discretion, a
maximum amount per share which will be payable upon exercise of a SAR, and may
impose conditions on exercise of a SAR. At the discretion of the Administrator,
payment for SARs may be made in cash or shares of Common Stock, or in a
combination thereof. SARs will be exercisable not later than ten years after the
date they are granted and will expire in accordance with the terms established
by the Administrator.

7. RESTRICTED STOCK. Restricted Stock is Common Stock issued or transferred
under the Plan (other than upon exercise of stock options or as Performance
Awards) at any purchase price less than the fair market value thereof on the
date of issuance or transfer, or as a bonus, subject to such terms and
conditions set forth in a Restricted Stock agreement as may be established by
the Administrator in its sole discretion. In the case of any Restricted Stock:

(a) The purchase price, if any, will be determined by the Administrator.

(b) The period of restriction shall be established by the Administrator for any
grants of Restricted Stock;

                                       2
<PAGE>

(c) Restricted Stock may be subject to (i) restrictions on the sale or other
disposition thereof; (ii) rights of the Corporation to reacquire such Restricted
Stock at the purchase price, if any, originally paid therefor upon termination
of the employee's employment within specified periods; (iii) representation by
the recipient that he or she intends to acquire Restricted Stock for investment
and not for resale; and (iv) such other restrictions, conditions and terms as
the Administrator deems appropriate.

(d) The Participant shall be entitled to all dividends paid with respect to
Restricted Stock during the period of restriction and shall not be required to
return any such dividends to the Corporation in the event of the forfeiture of
the Restricted Stock.

(e) The Participant shall be entitled to vote the Restricted Stock during the
period of restriction.

(f) The Administrator shall determine whether Restricted Stock is to be
delivered to the Participant with an appropriate legend imprinted on the
certificate or if the shares are to be issued in the name of a nominee or
deposited in escrow pending removal of the restrictions.

8. PERFORMANCE AWARDS. Performance Awards are Common Stock, monetary units or
some combination thereof, to be issued without any payment therefor, in the
event that certain performance goals established by the Administrator are
achieved over a period of time designated by the Administrator, but not in any
event more than five years. The goals established by the Administrator may
include return on average total capital employed, earnings per share, increases
in share price or such other goals as may be established by the Administrator.
In the event the minimum corporate goal is not achieved at the conclusion of the
period, no payment shall be made to the Participant. Actual payment of the award
earned shall be in cash or in Common Stock or in a combination of both, as the
Administrator in its sole discretion determines. If Common Stock is used, the
Participant shall not have the right to vote and receive dividends until the
goals are achieved and the actual shares are issued.

9. INCENTIVE STOCK OPTIONS. ISOs are stock options to purchase shares of Common
Stock at not less than 100% of the fair market value of the shares on the date
the option is granted (110% if the optionee owns stock possessing more than 10%
of the combined voting power of all owners of stock of the Corporation or a
subsidiary), subject to such terms and conditions set forth in an option
agreement as may be established by the Administrator in its sole discretion that
conform to the requirements of Section 422 of the Code. Said purchase price may
be paid (a) by check or (b), in the discretion of the Administrator, by the
delivery of shares of Common Stock then owned by the Participant, or (c), in the
discretion of the Administrator, by a combination of any of the foregoing, in
the manner provided in the option agreement. The aggregate fair market value
(determined as of the time an option is granted) of the stock with respect to
which ISOs are exercisable for the first time by an optionee during any calendar
year (under all option plans of the Corporation and its subsidiary corporations)
shall not exceed $100,000.00 or such other maximum applicable to ISOs as may be
in effect from time to time under the Code. ISOs shall be granted only to
employees of the Corporation and designated subsidiaries. The maximum term of an
ISO shall be ten years from the date it was granted (five years if the optionee
owns more than 10% of the total combined voting power of all classes of stock of
the Corporation or a subsidiary). No ISO shall be awarded after the date
preceding the tenth anniversary of the effective date of the Plan.

                                       3
<PAGE>

10. NONQUALIFIED STOCK OPTIONS. NQSOs are nonqualified stock options to purchase
shares of Common Stock at purchase prices established by the Administrator on
the date the options are granted, subject to such terms and conditions set forth
in an option agreement as may be established by the Administrator in its sole
discretion. The purchase price may be paid (a) by check or (b), in the
discretion of the Administrator, by the delivery of shares of Common Stock then
owned by the Participant, or (c), in the discretion of the Administrator, by a
combination of any of the foregoing, in the manner provided in the option
agreement. NQSOs shall be exercisable no later than ten years after the date
they are granted.

11. STOCK UNITS. A Stock Unit represents the right to receive a share of Common
Stock from the Corporation at a designated time in the future, subject to such
terms and conditions set forth in a Stock Unit agreement as may be established
by the Administrator in its sole discretion. The Participant generally does not
have the rights of a shareholder until receipt of the Common Stock. The
Administrator may in its discretion provide for payments in cash, or adjustment
in the number of Stock Units, equivalent to the dividends the Participant would
have received if the Participant had been the owner of shares of Common Stock
instead of the Stock Units.

12.  ADJUSTMENT PROVISIONS.

(a) If the Corporation shall at any time change the number of issued shares of
Common Stock without new consideration to the Corporation (such as by stock
dividends or stock splits), the total number of shares reserved for issuance
under this Plan and the number of shares covered by each outstanding Benefit
shall be adjusted so that the aggregate consideration payable to the
Corporation, if any, and the value of each such Benefit shall not be changed.
Benefits may also contain provisions for their continuation or for other
equitable adjustments after changes in the Common Stock resulting from
reorganization, sale, merger, consolidation, issuance of stock rights or
warrants, or similar occurrence.

(b) Notwithstanding any other provision of this Plan, and without affecting the
number of shares reserved or available hereunder, the Board of Directors may
authorize the issuance or assumption of Benefits in connection with any merger,
consolidation, acquisition of property or stock, or reorganization upon such
terms and conditions as it may deem appropriate.

13. CHANGE IN CONTROL. Notwithstanding any other provision of the Plan to the
contrary, in the event of a Change in Control of the Corporation, as defined
below, all outstanding SARs, ISOs and NQSOs shall be immediately fully vested
and exercisable and any restrictions on Restricted Stock issued under the Plan
shall lapse.

Change in Control means:

     (a) The acquisition on or after March 6, 2003 by any individual, entity or
     group, or a Person (within the meaning of Section 13(d)(3) or 14(d)(2) of
     the Exchange Act) other than an Excluded Person (as defined below), of
     ownership of more than 50% of either: (i) the then outstanding shares of
     Common Stock ("Outstanding Common Stock"); or (ii) the combined voting
     power of the then outstanding voting securities of the Corporation entitled
     to vote generally in the election of directors ("Outstanding Voting
     Securities");

     (b) Individuals who, as of the date of approval of the Plan by the Board of
     Directors of the Corporation, constitute the Board of Directors of the
     Corporation ("Incumbent Board") cease for any reason to constitute at least
     a majority of the Board; provided, however, that any individual becoming a
     director subsequent to the date hereof whose election, or nomination for
     election by the Corporation's stockholders, was approved by a vote of at
     least a majority of the directors then comprising the Incumbent Board shall
     be considered as though such individual were a member of the Incumbent

                                       4
<PAGE>

     Board, but excluding, as a member of the Incumbent Board, any such
     individual whose initial assumption of office occurs as a result of either
     an actual or threatened election contest (as such terms are used in Rule
     14a-11 of Regulation 14A promulgated under the Exchange Act) or other
     actual or threatened solicitation of proxies or consents by or on behalf of
     a Person other than the Board; or

     (c) Approval by the stockholders of the Corporation of a reorganization,
     merger or consolidation, in each case, unless, following such
     reorganization, merger or consolidation, (i) more than 50% of,
     respectively, the then outstanding shares of common stock of the
     corporation resulting from such reorganization, merger or consolidation and
     the combined voting power of the then outstanding voting securities of such
     corporation entitled to vote generally in the election of directors is then
     beneficially owned, directly or indirectly, by all or substantially all of
     the individuals and entities who were the beneficial owners, respectively,
     of the Outstanding Corporation Common Stock and Outstanding Corporation
     Voting Securities immediately prior to such reorganization, merger or
     consolidation, in substantially the same proportions as their ownership,
     immediately prior to such reorganization, merger or consolidation of the
     Outstanding Corporation Common Stock and Outstanding Corporation Voting
     Securities, as the case may be, or at least a majority of the members of
     the board of directors of the corporation resulting from such
     reorganization, merger or consolidation were members of the Incumbent Board
     at the time of the execution of the initial agreement providing for such
     reorganization, merger or consolidation; or

     (d) Approval by the stockholders of the Corporation of (i) a complete
     liquidation or dissolution of the Corporation or (ii) the sale or other
     disposition of all or substantially all of the assets of the Corporation,
     other than to a corporation, with respect to which following such sale or
     other disposition, (1) more than 50% of, respectively, the then outstanding
     shares of common stock of such corporation and the combined voting power of
     the then outstanding voting securities of such corporation entitled to vote
     generally in the election for directors is then beneficially owned,
     directly or indirectly, by all or substantially all of the individuals and
     entities who were the beneficial owners, respectively, of the Outstanding
     Corporation Common Stock and Outstanding Corporation Voting Securities
     immediately prior to such sale or other disposition in substantially the
     same proportion as their ownership, immediately prior to such sale or other
     disposition, of the Outstanding Corporation Common Stock and Outstanding
     Corporation Voting Securities, as the case may be,or (2) at least a
     majority of the members of the board of directors of such corporation were
     members of the Incumbent Board at the time of the execution of the initial
     agreement or action of the Board providing for such sale or other
     disposition of assets of the Corporation.

Excluded Person means any Person who beneficially owns more than 10% of the
outstanding shares of the Corporation on the date hereof or at any time prior to
the first anniversary of the adoption of this plan.

14. NONTRANSFERABILITY. Each Benefit granted under the Plan shall not be
transferable otherwise than by will or the laws of descent and distribution;
provided, however, NQSOs granted under the Plan may be transferred, without
consideration, to a Permitted Transferee (as defined below). Benefits granted
under the Plan shall be exercisable, during the Participant's lifetime, only by
the Participant or a Permitted Transferee. In the event of the death of a
Participant, exercise or payment shall be made only:

                                       5
<PAGE>

(a) By or to the Permitted Transferee, executor or administrator of the estate
of the deceased Participant or the person or persons to whom the deceased
Participant's rights under the Benefit shall pass by will or the laws of descent
and distribution; and

(b) To the extent that the deceased Participant or the Permitted Transferee, as
the case may be, was entitled thereto at the date of his death.

For purposes of this Section 14, Permitted Transferee shall include (i) one or
more members of the Participant's family, (ii) one or more trusts for the
benefit of the Participant and/or one or more members of the Participant's
family, or (iii) one or more partnerships (general or limited), corporations,
limited liability companies or other entities in which the aggregate interests
of the Participant and members of the Participant's family exceed 80% of all
interests. For this purpose, the Participant's family shall include only the
Participant's spouse, children and grandchildren.

15. TAXES. The Corporation shall be entitled to withhold the amount of any tax
attributable to any amounts payable or shares deliverable under the Plan after
giving the person entitled to receive such payment or delivery notice as far in
advance as practicable, and the Corporation may defer making payment or delivery
as to any Benefit if any such tax is payable until indemnified to its
satisfaction. The person entitled to any such delivery may, by notice to the
Corporation at the time the requirement for such delivery is first established,
elect to have such withholding satisfied by a reduction of the number of shares
otherwise so deliverable, such reduction to be calculated based on a closing
market price on the date of such notice.

16. TENURE. A Participant's right, if any, to continue to serve the Corporation
and its subsidiaries as an officer, employee, or otherwise, shall not be
enlarged or otherwise affected by his or her designation as a Participant under
the Plan.

17. RULES OF CONSTRUCTION. The terms of the Plan shall be constructed in
accordance with the laws of the State of Delaware; provided that the terms of
the Plan as they relate to ISOs shall be construed first in accordance with the
meaning under and in a manner that will result in the Plan satisfying the
requirements of the provisions of the Code governing incentive stock options.

18. DURATION, AMENDMENT AND TERMINATION. No Benefit shall be granted more than
ten years after the date of adoption of this Plan; provided, however, that the
terms and conditions applicable to any Benefit granted within such period may
thereafter be amended or modified by mutual agreement between the Corporation
and the Participant or such other person as may then have an interest therein.
Also, by mutual agreement between the Corporation and a Participant hereunder,
stock options or other Benefits may be granted to such Participant in
substitution and exchange for, and in cancellation of, any Benefits previously
granted such Participant under this Plan.

The Board of Directors may amend the Plan from time to time or terminate the
Plan at any time. However, no action authorized by this paragraph shall reduce
the amount of any existing Benefit or change the terms and conditions thereof
without the Participant's consent. No amendment of the Plan shall, without
approval of the stockholders of the Corporation, (a) increase the total number
of shares which may be issued under the Plan or increase the amount or type of
Benefits that may be granted under the Plan; or (b) modify the requirements as
to eligibility for Benefits under the Plan.

                                       6
<PAGE>

19. EFFECTIVE DATE. This Plan shall become effective as of the date it is
adopted by the Board of Directors of the Corporation subject only to approval by
the holders of a majority of the outstanding voting stock of the Corporation
within twelve months before or after the adoption of the Plan by the Board of
Directors. In the event that the shareholders fail to approve the Plan within
twelve (12) months after its adoption by the Board, any grants made pursuant to
the Plan or sales of Option Shares that have already occurred shall be
rescinded, and no additional grants, sales or awards shall be made thereafter
under the Plan.

The undersigned hereby certifies that this Plan was adopted by the Board of
Directors of the Corporation at its meeting on March 6, 2002.

By:  /S/ Munawar H. Hidayatallah
   --------------------------------------------------
      Munawar H. Hidayatallah, President

                                       7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00039-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00039-of-00352.parquet"}]]