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ex10-2.txt

EX10-2.TXT







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                              EMPLOYMENT AGREEMENT





                                     BETWEEN





                                 MICHAEL KOEPKE





                                       AND





                            OWOSSO MOTOR GROUP, INC.



















                               September 30, 1996









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                              EMPLOYMENT AGREEMENT



         THIS EMPLOYMENT AGREEMENT is made this 30th day of September, 1996, by

and between Michael Koepke, a resident of the State of Illinois (the

"Employee"), and OWOSSO MOTOR GROUP, INC., a corporation organized and existing

under the laws of the Commonwealth of Pennsylvania (the "Company").



                               W I T N E S S E T H



         WHEREAS, the Company is a manufacturers' representative engaged in the

business (the "Business") of sales and marketing of products for Stature

Electric, Inc., Motor Products Owosso, Motor Products Ohio and certain other

companies and divisions of Owosso Corporation (the "Represented Companies").



         WHEREAS, Employee possesses significant knowledge of the Business,

which knowledge the Company and Employee both desire to be available to the

Company for a period of time in the future upon the terms and conditions

hereinafter set forth.



         WHEREAS, the execution and delivery of this Agreement by Employee in

connection with the consummation of the merger of Koepke & Associates

("Koepke"), with and into the Company (the "Transaction"), is a material

inducement to the Company's agreement to consummate the Transaction.



         NOW, THEREFORE, in consideration of the mutual covenants and

obligations contained herein, and intending to be legally bound, the parties,

subject to the terms and conditions set forth herein, agree as follows:



         1. Employment and Term. The Company hereby employs Employee and

Employee hereby accepts employment with the Company, as its President (such

position, Employee's "Position") for a period commencing on the date hereof and

continuing until the fifth (5th) anniversary of the date hereof, subject to the

provisions of Section 9 hereof (the "Term").



         2. Duties. During the term of his employment, Employee shall serve the

Company faithfully and to the best of his ability and shall devote his full

time, attention, skill and efforts to the performance of the duties required by

or appropriate for his Position. Employee agrees to assume such duties and

responsibilities as may be customarily incident to such position, and as may be

reasonably assigned to Employee from time to time by the Board of Directors of

the Company. Employee shall report to the Board of Directors of the Company.





                                       -2-





         3. Other Business Activities. During the Term, Employee will not,

without the prior written consent of the Company, directly or indirectly engage

in any other business activities or pursuits whatsoever, except activities in

connection with any charitable or civic activities, personal investments and

serving as an executor, trustee or in other similar fiduciary capacity;

provided, however, that such activities do not interfere with his performance of

his responsibilities and obligations pursuant to this Agreement.



         4. Compensation.



            (a) The Company shall pay Employee, and Employee hereby agrees to

accept, as compensation for all services rendered hereunder and for Employee's

covenant not to compete as provided for in Section 8 hereof, a base salary at

the annual rate of One Hundred Twenty Thousand Dollars ($120,000) per year (the

"Base Salary"). The Base Salary shall be payable in twenty-four (24) equal

semi-monthly installments. The Base Salary shall be inclusive of all applicable

income, social security and other taxes and charges which are required by law to

be withheld by the Company or which are requested to be withheld by Employee,

and which shall be withheld and paid in accordance with the Company's normal

payroll practice for its similarly situated employees from time to time in

effect.



            (b) In addition to the Base Salary, the Company shall pay Employee a

bonus (the "Bonus") in an amount equal to: (i) One-Tenth of One percent (.1%) of

the gross sales of the Represented Companies ("Gross Sales") for the immediately

preceding fiscal year (the "Sales Percentage Bonus"); PLUS (ii) Three-Tenths of

One percent (.3%) of the difference between the Gross Sales for the current

fiscal year MINUS the Gross Sales for the immediately preceding fiscal year (the

"Incremental Sales Bonus"), but in no event shall the Incremental Sales Bonus be

a negative number; provided, however, that in no event shall the Bonus exceed

Two Hundred Thousand Dollars ($200,000) in any fiscal year. The Sales Percentage

Bonus shall be paid in Twenty-Four (24) equal semi-monthly installments along

with the Base Salary. The Incremental Sales Bonus shall be paid within ten (10)

days of the availability of audited financial statements of the Company for the

current fiscal year, but in no event shall the Bonus be paid more than ninety

(90) days after the end of the current fiscal year. In the event Employee is

terminated during the course of any fiscal year pursuant to the terms of Section

9 hereof, the Bonus for such fiscal year shall be pro rated according the actual

number of days in such fiscal year that Employee was employed by the Company.



            (c) In the event of a material change in the operation of the

Represented Companies, including but not limited to, a sale of one of the

Represented Companies or the discontinuation of a major product line, then in no

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