Employment Contract With Douglas Casterlin

Exhibit 10.5


Employment Contract Between American Bio Medica Corporation


and Douglas Casterlin


EMPLOYMENT AGREEMENT


This agreement (the "Agreement") made and entered into this 17th day of April, 1997 by and between American Bio Medica, a New York Corporation with its office located at 102 Simons Road, Ancramdale, New York 12503 ("Employer") and Douglas Casterlin individual residing at 65 Ballory Road, Ghent, NY 12075 ("Employee") (Employer and Employee are sometimes collectively referred to as the "Parties")

WHEREAS, Employer is engaged in the business of research and development, design, manufacture and marketing of drug testing kits and other biomedical products; and

WHEREAS, Employee is experienced in production and operations of biomedical products including drug testing kits.


WHEREAS, both Employer and Employee are desirous of entering into an employment agreement whereby Employee would devote his time and Employer would compensate him as an employee.


NOW THEREFORE, in consideration of the premises and of the mutual covenants herein contained, the Parties agree as follows:


1. Employment and Duties: Employer hereby employs Employee as Vice President
and General Manager.


2. Performance: Employee will devote substantially his full working time and
efforts as an employee of Employer. "Full working time," in this context,
shall mean at least an average of 40 hours per week.


3. Term: The Employment Term shall commence on May 26, 1977 and, unless
extended by mutual agreement of the parties hereto, or sooner terminated or
canceled pursuant to Section 14 hereof, shall terminate and expire on May
25, 2000.


4. Compensation: Employee shall be paid a base annual salary of $84,000 per
annum. Employer may from time to time enter into supplemental agreements or
memoranda in writing with Employee for the award and payment to him of
additional compensation or bonuses upon such terms and conditions as
Employer shall deem to be in its business interest. In addition, effective
with the date of this contract:


Employee shall be paid, on a quarterly basis, a bonus equal to 1% net
sales after gross revenues of $1,000,000 per fiscal year.


Employee shall receive 150,000 options at $3.00 per share vesting
immediately.


No bonuses will be earned subsequent to the Employee's election to
terminate the Agreement or Employer's discharge of Employee for cause.
In the event of Termination due to death of Employee or inability due
to illness of Employee to render services under the Agreement to
Employer, no bonuses shall be paid; but shares shall vest pursuant to
the formula set forth in this section.


In the event that American Bio Medica Corporation is merged or
acquired by another company, all unvested shares and/or options become
immediately vested.


If the employee is terminated without cause, all unvested shares
and/or options become immediately vested and the balance of annual
salary due for the term of the contract is paid as severance.


5. Employee Benefits: Employee shall be entitled to be covered by any employee
health insurance policy, dental plan, pension plan, stock option or similar
plans or other employee benefit(s) offered generally to management
employees of Employer. Employee shall not be obligated to contribute any
money to be covered under said plain except in the event the Company enacts
a contributory pension plan for other employees. Employee shall be entitled
to three weeks paid vacation at times to be mutually agreed upon between
Employer and Employee.


6. Expenses: In addition to the compensation provided Employee under the
Agreement, Employer shall reimburse Employee for any and all authorized
expenses which he shall incur directly relating to his functions ...