Vice President of Finance Employment Agreement

EXHIBIT 10.5

EXECUTION VERSION EMPLOYMENT AGREEMENT

This Employment Agreement dated as of November 28, 2006, between National Home Health Care Corp. , a Delaware corporation having an address at 700 White Plains Road, Scarsdale, New York 10583 (the " Company" ), and Robert P. Heller , an individual having an address at 700 White Plains Road, Scarsdale, New York 10583 (" Employee" ).

W I T N E S S E T H :

WHEREAS, the Company desires that Employee continue to be employed by it and continue to render services to it, and Employee is willing to continue to be so employed and to continue to render such services to the Company, all upon the terms and subject to the conditions contained herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Employment . Subject to and upon the terms and conditions contained in this Agreement, the Company hereby agrees to continue to employ Employee and Employee agrees to continue in the employ of the Company, for the period set forth in Paragraph 2 hereof, to render the services to the Company, its affiliates and/or subsidiaries described in Paragraph 3 hereof. This Agreement is not effective until and is contingent upon the " effective time" (the " Effective Date" ) of the merger pursuant to that certain agreement among the Company, AG Home Health Acquisition Corp., and AG Home Health LLC(the " Merger Agreement" ).

2. Term . Employee' s term of employment under this Agreement shall commence on the Effective Date and shall continue for a period through and including the fifth anniversary of the Effective Date (the " Employment Term" ) unless extended in writing by both parties or earlier terminated pursuant to the terms and conditions set forth herein.

3. Duties . (a) Employee shall be employed as the Company' s Executive Vice President of Finance, Chief Financial Officer and Treasurer. It is agreed that Employee shall perform his services, subject to required business travel, in the Company' s Scarsdale, New York facilities or within 10 miles of such facility, or any other facilities mutually agreeable to the parties. If the Company undergoes a Change in Control (as defined in Paragraph 11 hereof) or other significant corporate transaction (collectively a " Corporate Transaction" ), then a change in the title of the Employee shall not be a breach of this Agreement, so long as following such Corporate Transaction the Employee remains the principal financial officer of the division or other entity which comprises essentially the same operations as were conducted by the Company prior to such Corporate Transaction. Except as set forth above, the rights and duties of Employee shall not in any way be curtailed by the Company without his consent nor shall he be deprived of the dignity ordinarily associated with his offices.

(b) Employee agrees to abide by all By-laws and applicable policies of the Company promulgated from time to time by the Board of Directors of the Company (the " Board" ), including without limitation the Business Policies of the Company annexed hereto as Annex A.

4. Exclusive Services and Best Efforts . Employee shall devote all of his working time, attention, best efforts and ability during regular business hours exclusively to the service of the Company, its affiliates and subsidiaries during the term of this Agreement.

5. Compensation . As compensation for his services and covenants hereunder, the Company shall pay Employee the following:

(a) Base Salary . The Company shall pay Employee a minimum base salary (" Salary" ) of $255,000 per year plus the CPI Increase described below. The Salary shall be subject to review and adjustment on an annual basis provided, however, that in no event shall Employee' s Salary be adjusted below the Salary designated herein. The Salary for Employee shall be increased annually by a percentage increase in the Consumer Price Index (the " CPI Increase" ); the first such increase shall be effective retroactively as of August 1, 2006whereupon the salary for Employee in effect on that date shall be increased as of that date by a percentage equal to the percentage increase in the Consumer Price Index from January 1, 2006 to December 31, 2006. Employee shall receive a lump sum payment equal to the CPI Increase appropriately prorated for the period from August 1 until the date coinciding with the end of the payroll period in which such lump sum payment is made, and such lump sum payment shall be paid to Employee on or prior to March 15, 2007. Each payroll period after such lump sum payment is made shall reflect Employee' s Salary, as augmented by the CPI Increase. During the Employment Term, Employee shall also be given CPI Increases (based on his then current Salary) as of each August 1 that occurs after August 1, 2006 with respect to the percentage increase in the Consumer Price Index for the 12-month period beginning on the immediately preceding January 1. Notwithstanding the foregoing, if Employee has already received the above described lump sum payment from the Company for the period beginning August 1, 2006, then such lump sum payment shall not be paid to Employee in 2007; however, Employee' s Salary for payroll periods after the Effective Date shall reflect the CPI Increase. As used in this Paragraph 5(a), Consumer Price Index shall mean the Consumer Price Index for Urban Wage Earners and Clerical Workers prepared by the Bureau of Labor Statistics of the U.S. Department of Labor, or, if that index is not then being published, the most nearly comparable successor index that the parties may agree upon or, if they fail to agree, an index designated by Company' s independent registered public accounting firm. If a successor index is used, the Company' s independent registered public accounting firm shall make such adjustments to the index as may be appropriate to carry out the intention of this paragraph and their determination shall be final and binding on the parties.

(b) Bonus Compensation .

(i) The Company shall pay Employee a bonus equal to one percent of the amount by which the income from operations for the fiscal period from August 1, 2006 to the Effective Date (determined in accordance with United States generally accepted accounting principles consistently applied) exceeds the product of $5,000,000 multiplied by the number of days between August 1, 2006 and the Effective Date and divided by Three Hundred Sixty-Five (365). The foregoing bonus shall be paid by the Company within thirty (30) days after the Effective Date.

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(ii) The Employee shall also receive annual bonus compensation (" Bonus Compensation" ) equal to one percent of the amount by which the " EBITDA of the Company" (as such term is defined in the Merger Agreement) exceeds (i) (x) $8,176,500, if the EBITDA of the Company for the EBITDA Period (as such term is defined in the Merger Agreement) as determined in accordance with the Merger Agreement is equal to or greater than $7,900,000 but less than $8,150,000, or (y) $8,435,200, if the EBITDA of the Company for the EBITDA Period as determined in accordance with the Merger Agreement is equal to or greater than $8,150,000 (as applicable, the " Base Year Amount" ) in the twelve month period, which commences on the first day of the calendar quarter in which occurs the Effective Date (the " Base Year" ) or (ii) Base Year Amount plus a compound annual growth rate of 3.5% for each subsequent twelve month period (each such period commencing with the calendar quarter in which an anniversary of the Effective Date occurs) in the Employment Term. The foregoing Bonus Compensation shall be paid by the Company within thirty (30) days after completion of the audited financial results of the Company for the applicable fiscal year, but in no event later than 2 and 1/2 months after the end of the fiscal year for which the bonus relates. Notwithstanding the foregoing, in the event of a Corporate Transaction, the Board shall equitably and in good faith adjust the above bonus targets to appropriately account for such event.

(c) LLC Interest . As soon as practical following the Effective Date, the Company shall grant to Employee an interest in AG Home Health LLC, which shall be treated for federal income tax purposes as a profits only interest and shall represent an interest in 3.0% of the future profits of the Company (the " Profits Interest" ). Such Profits Interest means the right to share in any cash or property distributions made by AG Home Health LLC, after the return of the Contributed Capital to, and the payment of a preferred return of 5.0% per annum on the Contributed Capital of, Angelo Gordon & Company, LP and/or its affiliates, and Eureka Capital Partners, LLC and/or its affiliates. The vesting of the Profits Interest shall be in accordance with the schedule attached hereto as Schedule A. For illustrative purposes, attached hereto as Schedule B is a description of the payments of the preferred return and the distributions of Contributed Capital and Profits Interest to be made by AG Home Health LLC. " Contributed Capital" shall mean the contributed cash capital of Angelo Gordon & Company, LP and/or its affiliates, and Eureka Capital Partners, LLC and/or its affiliates, and credits for any expenses related to the transactions contemplated by the Merger Agreement paid prior to the Effective Date by Angelo Gordon & Company, LP and/or its affiliates, or Eureka Capital Partners, LLC and/or its affiliates.

6. Business Expenses . Employee shall be reimbursed for, and entitled to advances (subject to repayment to the Company if not actually incurred by Employee) with respect to, those business expenses incurred by him which are reasonable and necessary for Employee to perform his duties under this Agreement in accordance with policies established from time to time by the Company.

7. Employee Benefits . (a) During the Employment Term, Employee shall be entitled to such insurance, disability, health and dental and medical benefits and be entitled to participate in such retirement plans or programs pursuant to the policies of the Company, as are, in the aggregate, no less beneficial to the Employee than the benefits to which the Employee is currently entitled; providedthat Employee shall be required to comply with the conditions attendant to coverage by such plans and shall comply with and be entitled to benefits only in

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accordance with the terms and conditions of such plans. The Company shall cause its non-qualified deferred compensation plan (the " Deferred Compensation Plan" ) to distribute to Employee all sums credited to Employee' s account in such Plan no later than fifteen (15) days after the Effective Date. In addition, the Company shall credit Employee' s account in its Deferred Compensation Plan with $12,000 no later than October 31st of each year during the Employment Term beginning on the November 1st following the Effective Date, provided that the Employee is employed by the Company on such October 31st. If Employee' s employment with the Company terminates prior to October 31, 2011 for reasons other than Employee' s death or termination without Cause, as of the date of such termination, Employee' s benefit under the Deferred Compensation Plan and all amounts credited to Employee' s account thereunder (including any earnings thereon) shall be forfeited. Employee shall be entitled to four weeks paid vacation each year during the Employment Term at such times as does not, in the reasonable opinion of the Board of Directors, interfere with Employee' s performance of his duties hereunder, provided that any unused vacation in any given calendar year shall not carry over into a subsequent calendar year. Notwithstanding anything to the contrary contained herein, the Company shall provide Employee with term life insurance in the amount of $545,000 and/or reimburse Employee for premiums paid by him on term life insurance (in an amount up to $545,000, inclusive of insurance maintained by the Company) as is currently in effect. The Company may withhold from any benefits payable to Employee all federal, state, local and other taxes and amounts as shall be permitted or required pursuant to law, rule or regulation. In addition to the foregoing, the Company shall pay to Employee the full amount of Employee' s annual contribution under the Company' s Premium Conversion Plan with respect to the Employee' s health, medical and dental premiums, payable in accordance with the Company' s normal payment practices.

(b) Employee shall be entitled to receive the sum of $550 per month as an automobile allowance provided at the expense of the Company from the Effective Date and during the Employment Term, which allowance shall be exclusive of all expenses related to car-phone, insurance, repairs and maintenance for such automobile, which expenses also shall be the responsibility of the Company. Employee agrees not to lease any automobile covered by such allowance for a term longer than three years. Notwithstanding the foregoing, the Company may, at its option, elect to provide Employee an automobile of the make, model and year mutually agreeable to the Company and Employee, all costs of which associated with insurance, repairs, maintenance and other expenses shall be the responsibility of the Company, in lieu of the above described automobile allowances, all as may be mutually agreed between Employee and the Company. Employee acknowledges that some or all of the foregoing may be deemed compensation to him.

8. Death and Disability . (a) The Employment Term shall terminate on the date of Employee' s death, in which event Employee' s Salary, reimbursable expenses and benefits owing to Employee through the date of Employee' s death shall be paid to his estate. Except as may be provided in Paragraph 11 hereof, the Employee' s estate will not be entitled to any other compensation upon termination of this Agreement pursuant to this Paragraph 8(a).

(b) If, during the Employment Term, in the opinion of a duly licensed physician selected by Employee and reasonably acceptable to the Company, Employee, because of physical or mental illness or incapacity, shall become substantially unable to perform the

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duties and services required of him under this Agreement for a period of six consecutive months the Company may, upon at least twenty (20) days' prior written notice given at any time after the expiration of such six-month period to Employee of its intention to do so, terminate this Agreement as of such date as may be set forth in the notice. In case of such termination, Employee shall be entitled to receive his Salary, reimbursable expenses and benefits owing to Employee through the date of termination. Except as may be provided in Paragraph 11 hereof, the Employee will not be entitled to any other compensation upon termination of this Agreement pursuant to this Paragraph 8(b).

9. Termination for Cause . (a) The Company may terminate the employment of Employee for Cause (as hereinafter defined). Upon such termination, the Company shall be released from any and all further obligations under this Agreement, except that the Company shall be obligated to pay Employee his Salary, reimbursable expenses and benefits owing to Employee through the day on which Employee is terminated. Employee will not be entitled to any other compensation upon termination of this Agreement pursuant to this Paragraph 9(a).

(b) As used herein, the term " Cause" shall mean: (i) the willful failure of Employee to perform his duties pursuant to Paragraph 3 hereof, which failure is not cured by Employee within thirty days following written notice thereof from the Company; (ii) any material breach of the representations or warranties made by Employee herein, which breach is or could reasonably be expected to be materially detrimental to the Company; (iii) except with respect to matters covered by subsections (i) and (ii) of this Section 9(b), any other material breach of this Agreement by Employee which breach is or could reasonably be expected to be materially detrimental to the Company and which breach (to the extent curable) is not cured by Employee within 10 business days following written notice thereof from the Company; (iv) any act, or failure to act, by Employee in bad faith or intentionally to the material detriment of the Company, which act or failure to act (to the extent curable) is not cured by Employee within 10 business days following written notice thereof from the Company; or (v) the commission by Employee of an act involving theft, dishonesty or any other wrongful action or conduct which materially damages the Company, its subsidiaries or affiliates.

10. Termination for Non-Performance or for Good Reason or upon a Change in Control .

(a) Notwithstanding anything to the contrary herein, including without limitation Paragraph 2 hereof, the Company may terminate the employment of Employee for Non-Performance (as defined in Paragraph 10(b) hereof) at any time on or after the second anniversary of the Effective Date or the Company may terminate the Employee upon or after a Change in Control (as defined in Paragraph 11) or the Employee may terminate his employment for Good Reason (as provided in Paragraph 12(f) hereof). Upon any such termination, the Company shall be released from any and all further obligations under this Agreement, except that (i) the Company shall be obligated to pay Employee his Salary, reimbursable expenses and benefits owing to Employee through the day on which Employee is terminated, (ii) the Company shall be obligated to continue to pay to the Employee, as severance compensation, his Salary through the expiration of the Employment Term ...