FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

(Mark One)

[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934

For the Quarter Ended      September 30, 2001

OR

[    ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
            SECURITIES EXCHANGE ACT OF 1934

Commission File No.   000-24455

TORVEC, INC.                                     (Exact name of Registrant as Specified in its Charter)

New York                 	 	16-150951-2                (State or Other Jurisdiction of              (IRS Employer Identification Number)
                Incorporation or Organization)

11 Pond View Drive, Pittsford, New York                          14534   (Address of Principal Executive Offices)                                    (Zip Code)

Registrant's telephone number, including area code:              (716) 248-8549

Securities registered under Sec. 12(g) of the Act:

$.01 Par Value Common Stock	                                                                                                     (Title of Class)

The Registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and has been subject to such filing requirements for the past 90 days.

YES  [ X ]               NO [     ]

As of September 30, 2001, there were outstanding 22,934,581 shares of the company's common stock, $.01 Par Value.  Options for 1,359,000 shares of the company's common stock are outstanding but have not yet been exercised.  Shares to cover the options will not be issued until they are exercised.



TORVEC, INC.

(A Development Stage Company)

INDEX



|PART I         | FINANCIAL INFORMATION                                                                                                                                                                                                                                                              | PAGE
|-------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----
|Item 1.        | Financial Statements                                                                                                                                                                                                                                                               |     
|               | Torvec, Inc. Condensed Balance Sheets -
December 31, 2000 and September 30, 2001 (unaudited)                                                                                                                                                                                       | 3   
|               | Torvec, Inc. Condensed Statements of Operations (Unaudited) - 
Three Months Ended September 30, 2001, Three Months Ended September 30, 2000, Nine Months Ended September 30, 2001, Nine Months Ended September 30, 2000, September 25, 1996 (Inception) through September 30, 2001 | 4   
|               | Torvec, Inc. Condensed Statements of Cash Flows (Unaudited) - 
Nine Months Ended September 30, 2001, Nine Months Ended September30, 2000, September 25, 1996 (Inception) through September 30, 2001                                                                                | 5   
|               | Notes to Financial Statements                                                                                                                                                                                                                                                      | 6   
|Item 2.        | Plan of Operation                                                                                                                                                                                                                                                                  | 13  
|PART II        | OTHER INFORMATION                                                                                                                                                                                                                                                                  |     
|Item 1.        | Legal Proceedings                                                                                                                                                                                                                                                                  | 18  
|Item 2.        | Changes in Securities                                                                                                                                                                                                                                                              | 22  
|Item 3.        | Defaults Upon Senior Securities                                                                                                                                                                                                                                                    | 22  
|Item 4.        | Submission of Matters to a Vote of Security Holders                                                                                                                                                                                                                                | 22  
|Item 5.        | Other Information                                                                                                                                                                                                                                                                  | 22  
|Item 6.        | Exhibits and Reports on Form 8-K                                                                                                                                                                                                                                                   | 23  
|SIGNATURE PAGE | 27                                                                                                                                                                                                                                                                                
|EXHIBIT INDEX  | 28                                                                                                                                                                                                                                                                                



TORVEC, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEETS

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | September 30, 2001(Unaudited)            | December 31, 2000                       
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------- | ----------------------------------------
| | ASSETS
CURRENT ASSETS
        Cash
        Stock subscriptions receivable (collected
          January 2001)
        Prepaid expenses                                                                                                                                                                                                                                                                                                                                                                                                                | $       3,000
         027,000           | $       34,000
109,000147,000           
| | Total Current Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 30,000                                   | 290,000                                 
| | PROPERTY AND EQUIPMENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                          |                                         
| | Office equipment
        Transportation equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 12,00053,00065,000                       | 9,00053,00062,000                       
| | LESS: ACCUMULATED DEPRECIATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 45,000                                   | 36,000                                  
| | Net Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 20,000                                   | 26,000                                  
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                          |                                         
| | LICENSE, net of accumulated amortization of
        $141,000 AND $14,000, respectively                                                                                                                                                                                                                                                                                                                                                                                                                                                               | 3,120,000                                | 3,246,000                               
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                          |                                         
| | Total Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | $3,170,000                               | $3,562,000                              
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                          |                                         
| | LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                          |                                         
| | CURRENT LIABILITIES
        Accounts payable and accrued expenses
        Consulting fees payable to related parties
        Current maturities of long-term debt
        Loans payable-stockholders                                                                                                                                                                                                                                                                                                                                                 | $    814,000
258,000
7,00092,000         | $     77,000
665,000
        6,0000     
| | Total Current Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 1,171,000                                | 748,000                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                          |                                         
| | LONG TERM LIABILITIES
     Long-term debt, net of current maturities
     Deferred revenue-long-term                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 4,000150,000                             | 9,000150,000                            
| | Total Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 246,000                                  | 159,000                                 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                          |                                         
| | COMMITMENT AND CONTINGENCIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                          |                                         
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                          |                                         
| | STOCKHOLDERS' EQUITY
     Preferred stock $.01 par value, 100,000,000 shares
        authorized, none issued
     Common stock, $.01 par value, 40,000,000 shares authorized,
       22,934,581 (including 90,590 shares subject to put option)
       and  22,552,062 (including 63,256 shares subject to put option)
       issued and outstanding at September 30, 2001 and
       December 31, 2000, respectively
     Additional paid in capital
     Deficit accumulated during the development stage
              Total Stockholders' Equity | 228,000
15,197,000
(13,580,000)1,845,000 | 225,000
13,125,000
(10,695,000)2,655,000
| | Total Liabilities and Stockholders' Equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | $3,170,000                               | $3,562,000                              

See Notes to Financial Statements

3

TORVEC, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)

|                                                                         | Three Months
EndedSeptember 30, 2001   | Three Months
EndedSeptember 30, 2000 | Nine Months
EndedSeptember 30, 2001    | Nine Months
EndedSeptember 30, 2000    | September 25, 1996
(Inception)
ThroughSeptember 30, 2001
|------------------------------------------------------------------------ | -------------------------------------- | ------------------------------------ | -------------------------------------- | -------------------------------------- | --------------------------------------------------------
|COSTS AND EXPENSES
 Research and development
 General and administrative | $315,000 
1,258,000 
----------------- | $195,000 
467,000 
----------------- | $934,000 
1,951,000 
----------------- | $505,000 
1,349,000 
----------------- | $3,978,000 
9,602,000 
---------------                  
|Net Loss                                                                 | $1,573,000
==========                  | $662,000
==========                  | $2,885,000
==========                  | $1,854,000
==========                  | $13,580,000
=========                                   
|Basic and Diluted Loss
 Per Share                                        | ($0.07)
==========                     | ($0.03)
==========                   | ($0.13)
==========                     | ($0.09)
==========                     |                                                         
|Weighted average number
of shares of common stock
 - basic and diluted   | 22,806,000 
==========                 | 21,307,000 
==========               | 22,687,000 
==========                 | 21,178,000
==========                  |                                                         



See Notes to Financial Statements









|TORVEC, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
|-----------------------------------------------------------------------------------------

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Nine Months
EndedSeptember 30, 2001                               | Nine Months
EndedSeptember 30, 2000                                     | September 25, 1996
(inception) ThroughSeptember 30, 2001                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------- | ----------------------------------------------------------------------- | -------------------------------------------------------------------------------------
| | CASH FLOWS FROM OPERATING ACTIVITIES:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                   |                                                                         |                                                                                      
| | Net loss
     Adjustment to reconcile net loss
     to net cash used in operating activities:
        Depreciation and amortization
        Compensation expense attributable
           to common stock options
        Common stock issued for services
        Contribution of services
        Changes in other current assets
           and current liabilities:
        (Increase)/decrease in other assets
        Increase/(decrease) in accounts payable
             and accrued expenses
           Increase in deferred revenue
           Net cash (used in) operating activities | ($2,885,000)
136,000
398,000
715,000
0
120,000
995,0000
(521,000) | ($1,854,000)
9,000
422,000
708,000
0
(150,000)
125,000150,000
(590,000) | ($13,580,000)
187,000
4,911,000
2,292,000
69,000
133,000
1,737,000150,000
(4,101,000)
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                   |                                                                         |                                                                                      
| | CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchase of property and equipment
     Cost of acquisition
       Net cash (used in) investing activities                                                                                                                                                                                                                                                                                                                                                                                                                                           | (3,000)0
          (3,000)                                        | 00              0                                                       | (65,000)(16,000)
      (81,000)                                                      
| | CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from sale of common stock and
       exercise of options
     Proceeds from long-term borrowings
     Repayment of long-term borrowings
     Proceeds from Loans from Stockholders
     Distributions
       Net cash provided by financing activities                                                                                                                                                                                                                                                                                      | 405,000
0
(4,000)
92,0000493,000
________                         | 500,000
0
(5,000)
00495,000
________                                    | 4,447,000
29,000
(18,000)
92,000(365,000)4,185,000
________                          
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | ________                                                          | ________                                                                | ________                                                                             
| | NET INCREASE IN CASH                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | (31,000)                                                          | (95,000)                                                                | 3,000                                                                                
| | CASH - BEGINNING OF PERIOD                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 34,000
________                                                   | 183,000
________                                                        | 0
________                                                                           
| | CASH - END OF PERIOD                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | $3,000
=======                                                    | $88,000
=======                                                         | $3,000
=======                                                                       

NON-CASH ACTIVITIES:
     During the nine-months ended September 30, 2001, $665,000 of consulting fees
     payable were exchanged for 126,667 shares of common stock.

See Notes to Financial Statements

5



TORVEC, INC.



NOTES TO FINANCIAL STATEMENTS



September 30,  2001



Note 1   Financial Statement Presentation

The information contained herein with respect to the three and nine month periods ended September 30, 2001 and September 30, 2000 and the period from September 25, 1996 (inception) through September 30, 2001 has not been audited but was prepared in conformity with generally accepted accounting principles for interim financial information and instructions for 10-QSB and Item 310(b) of Regulation S-B.  Accordingly, the condensed financial statements do not include all information and footnotes required by generally accepted accounting principles for financial statements.  Included are ordinary adjustments, which in the opinion of management are necessary for a fair presentation of the financial information for the three and nine month periods ended September 30, 2001 and September 30, 2000, and since inception.  The results are not necessarily indicative of results to be expected for the year.

For the period from inception through September 30, 2001, the Company has accumulated a deficit of $13,580,000, has a working capital deficiency of $1,141,000 and has been dependent upon equity financing, loans from shareholders and the exchange of stock for services to meet its obligations and sustain operations. These factors raise substantial doubt about the Company's ability to continue as a going concern. In order to continue its operations, the Company is seeking additional financing and exploring opportunities such as collaborative arrangements, joint ventures or licensing arrangements. However, there is no assurance that the Company can obtain adequate additional financing, that products will be developed which will be commercially successful, or that profitable operations can be attained. The financial statements do not include any adjustments relating to the recoverability or classification of recorded asset amounts or the amount and classification of liabilities that might be necessary as a result of the above uncertainty.

Note 2   The Company

Torvec, Inc. (the Company) was incorporated in New York on September 25, 1996.  The Company, which is in the development stage, specializes in automotive technology.

On November 29, 2000 the Company acquired Ice Surface Development, Inc. ("Ice").  Ice, which is also in the development stage, has a license and technology associated with ice removal and adhesion.



6



TORVEC, INC.



NOTES TO FINANCIAL STATEMENTS



September 30, 2001





Note 3   Summary of Significant Accounting Policies

Consolidation

The financial statements include the accounts of the Company and its wholly owned subsidiary, Ice as at September 30, 2001 and December 31, 2000, and from the date of its acquisition.  All material intercompany transactions and account balances have been eliminated in consolidation.

Equipment

Equipment is stated at cost less accumulated depreciation.  Depreciation is provided using the straight-line method over the useful lives of the assets.

Research, Development and Patents

Research, development costs and patent expenses are charged to operations as incurred.

License

The license is being amortized over its remaining life of approximately 19 years, which correlates to an underlying patent.

Revenue Recognition

Revenue in connection with the granting of license to Variable Gear LLC is to be recognized when all conditions specified under recent accounting standards have been met.  Generally, revenue is only recorded when no future performance is required related to the item.

Note 4   Related Party Transactions

The Company has entered into consulting agreements with members of the Gleasman family.  Included in research and development and general and administrative expenses for the periods ending September 30, 2001 and September 30, 2000 is $337,500 and $337,500 respectively for consulting expenses.

The Company engaged the services of a partnership for which two of the officers are partners in to provide consulting services prior to naming the two individuals as officers of the Company.  Included in research and development and general and administrative expenses for the three months ending September 30, 2001 is $535,000 for consulting expenses.

7



TORVEC, INC.



NOTES TO FINANCIAL STATEMENTS



September 30,  2001

Note 5  Loans from Shareholders

During the quarter ending September 30, 2001, James Gleasman loaned the Company $42,000.  The loan is non-interest bearing and has no stated repayment terms.  Also during the quarter ending September 30, 2001, a shareholder loaned the Company $50,000.  The loan includes interest at 7.5% and has no repayment terms.  The total of the two loans amounting to $92,000 is classified as loans payable stockholders.

Note 6  Long-Term Debt

Long-term debt at September 30, 2001 consisted of a note payable in monthly installments of  $610 including interest at 10.13% through March, 2003.  The note is secured by transportation equipment.

Note 7   Consultant Stock Plan and Option Plan

The Company's Business Consultant Stock Plan as amended, ("the Plan") provides for the granting of 400,000 shares of the Company's $.01 par value stock, which may be issued from time to time to business consultants and advisors.  On October 11, 2001 the Board of Directors approved a increase in the number of common shares to be issued under the Plan from 400,000 to 600,000 common shares.

For the nine months ended September 30, 2001, 155,848 shares were issued under the Plan to consultants in exchange for services and amounts owed to these consultants.  The shares were valued at the market value of the shares at the date of issuance and approximated $715,000.

In August 2001, the Company granted 100,000 options to an officer in his capacity as consultant CFO at $5.00 per share exercisable immediately.  In connection therewith, the Company recorded a stock compensation change of $398,000 in the third quarter.  The term of the option granted shall be for a period of 10 years.

Note 8   Equity Funding

In connection with the Company's equity funding commitment from Swartz Private Equity LLC the Company sold 12,810 shares of its common stock for aggregate proceeds of approximately $46,000 during the three months ended September 30, 2001.

8



TORVEC, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2001



Note 9   Litigation

The Company's Lawsuits

On November 14, 2000, the company joined with Vernon and Keith Gleasman, as plaintiffs, in filing a lawsuit against McElroy Manufacturing, Inc., Arthur H. McElroy, II and Tri-Mc (collectively, "MMI") in the United States District Court for the Northern District of Oklahoma.

|Management believes that MMI is liable to the plaintiffs for considerable compensatory and punitive damages in an amount to be determined at trial.  The plaintiffs have demanded a jury trial with respect to this litigation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|On January 2, 2001, MMI moved to dismiss the plaintiffs' complaint.  On September 24, 2001 the Court denied MMI's motion and allowed the case to proceed to trial.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|On February 26, 2001, the company brought suit against John Spiezio and John Doe, a/k/a "Torvec1" in the United States District Court for the Western District of New York.  The company contends that, Spiezio, John Doe and "Torvec1" either alone or acting on behalf of other persons, maliciously published numerous false and defamatory statements on the Internet worldwide website, "Raging Bull."  The company also claims that the defendant(s) intentionally interfered with the company's business to its detriment.                                                                                                                                                                                                                                                                                 
|The company seeks compensatory and punitive damages against the defendant(s) in an amount to be determined at trial and has demanded a jury trial.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|On April 12, 2001 defendant(s) moved to dismiss the plaintiff's complaint on the grounds that the statements made were not malicious or defamatory, constituted protected opinion and did not injure the company.  On June 19, 2001, the company responded to the defendant's motion to dismiss, sought permission of the Court to add Elizabeth Spezio as a defendant and sought permission to assert a new cause of action against the defendant(s) for conspiracy under the Racketeer Influenced and Corrupt Organizations Act ("RICO").  The parties are awaiting the decision of the Court with respect to the company's and defendant's motion.  On October 29, 2001, the Court granted the defendant(s) motion and dismissed the company's complaint for lacking diversity and subject matter jurisdiction.



9



TORVEC, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2001



Note 9   Litigation (Cont'd)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|The Gleasman Litigation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|On August 29, 1997, McElroy Manufacturing, Inc. of Tulsa, Oklahoma, and two MMI employees (collectively "MMI"), initiated a lawsuit against Vernon and Keith Gleasman in the United States District Court for the Northern District of Oklahoma.  The company is not a party to this litigation.  The plaintiffs claimed that the Gleasmans had breached an agreement dated October 10, 1991 to market inventions developed under U.S. Patent 5,440,878 (the gimbal patent), in which MMI had an interest.  Secondly, the plaintiffs alleged that the two MMI employees should have been named as co-inventors on three other patents.  The plaintiffs also sought reimbursement of their development costs in the amount of $750,000.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

On February 6, 1998, the Court stayed all aspects of the litigation pending arbitration in New York State.

|Hearings were conducted before the arbitrator in 1998.  On April 22, 1999, the arbitrator issued a nonappealable decision which determined that Vernon and Keith Gleasman exclusively owned all three patents, thereby confirming that these patents, which were assigned by them to the company, are the exclusive patents of the company.  The arbitrator also determined that neither party breached the 1991 Agreement, but that, in accordance with its terms, the sum of $862,699.61 should be paid to MMI (as reimbursement for development costs) by the Gleasmans out of royalties and other sums which they may receive and that MMI was entitled to a 20% interest in all royalties and other sums received by the Gleasmans.

On June 15, 1999, MMI filed its amended complaint in the United States District Court for the Northern District of Oklahoma.  There were two causes of action.  The first cause of action sought correction of the inventorship of the subject patents.   The second cause of action sought an order confirming the arbitrator's award and, in addition, sought an order directing that the Gleasmans reimburse MMI immediately for its expenses in the amount of $862,699.61 plus interest accruing from the date of the arbitrator's award.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





TORVEC, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2001





|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | 
|On March 31, 2000, the Court remanded the case to the arbitrator to clarify certain ambiguities regarding the payment and terms of his April 22, 1999 decision.  On July 10, 2000, the arbitrator issued an "Addendum and Clarification Memorandum" awarding $360,000 to MMI in partial reimbursement of its expenses.  This amount is to be paid by Vernon and Keith Gleasman, not the company.

On March 23, 2001, the Court confirmed the arbitrator's award against Vernon and Keith Gleasman for MMI's expense reimbursement in the amount of $360,000.  The Court stayed enforcement of the award until the court resolved the question of whether MMI committed fraud upon the court in bringing its lawsuit.  As a condition for the stay, Vernon and Keith Gleasman deposited $423,000 (including $63,000 interest) with the Court.
|On September 24, 2001, the Court determined that even if MMI had committed fraud in bringing its lawsuit, such fraud, even if proven, did not directly relate to or influence the arbitrator's award.  The Court, therefore, confirmed the award against Vernon and Keith Gleasman.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|As stated above, the company is not, and never has been, a party to this litigation.  Based upon the order of the Court confirming the award against Vernon and Keith Gleasman, the company not obligated in any way to reimburse MMI for their expenses nor liable to MMI for any continuing royalty obligation or any other sums.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         



Note 10  Employment Agreements

Certain employment agreements dated February 6, 1998 were terminated effective August 1, 2001.  However, options previously granted pursuant to those agreements remain in effect.

11



TORVEC, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 2001



Note 9   Litigation (Cont'd)

On August 1, 2001, the Company entered into three-year employment agreements with Michael Martindale and Jacob Brooks as Chief Executive Officer and Chief Operating Officer respectively.  The employment agreements provide for annual base salary of $240,000 for the remainder of calendar 2001 and increasing thereafter by $20,000 per annum.  In addition, the agreements provide for an annual bonus of $60,000 for the remainder of calendar year 2001 and increasing thereafter by $60,000 per annum.  On September 1, 2001 the Company entered into a three-year employment agreement with David Marshall as Vice President - Manufacturing.  The employment agreement provides for annual base salary of $144,000 for the remainder of calendar 2001 and increasing by $16,000 for calendar year 2002, and increasing thereafter by $30,000 per annum.  In addition, the agreement provides for annual bonuses of $25,000, $40,000 and $50,000 for calendar years 2001, 2002 and 2003 respectively.

The company may pay all compensation under these agreements either in cash or common stock as determined by the Board of Directors.  In connection with these agreements, the company granted Mr. Martindale and Mr. Brooks each 180,000 options at $5.00 per share and 90,000 options at $5.00 per share for Mr. Marshall.  The term of the options granted shall be for a period of 10 years.

Note 11  Variable Gear LLC

On January 1, 2008, the Company is required to purchase the 51% membership interest it does not own in Variable Gear LLC at the then fair market value as defined.  At September 30, 2001 such fair market value cannot yet be reasonably estimated.





12



TORVEC, INC.
PLAN OF OPERATION

The following discussion should be read in conjunction with, and is qualified in its entirety by, the Financial Statements and the Notes thereto included in this report.  This discussion contains certain forward-looking statements that involve substantial risks and uncertainties.  When used in this report, the words "anticipate", "expect" and similar expressions as they relate to the company or its management are intended to identity such forward-looking statements.  The company's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements.  Historical operating results are not necessarily indicative of the trends in operating results for any further period.

The company's overall business strategy relating to its automotive inventions is

|  |                                                                                                                                                                                                                                                                 
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|o | to manufacture, market and sell, either directly, through others or jointly, the
FTVÔ
 to domestic and foreign customers, especially in the Asian, African, South
and Central American markets; and                                                             
|o | to manufacture, market and sell, either directly, through others or jointly, its
hydraulic pump and motor, its constant velocity joint and its infinitely variable
transmission to automotive and truck manufacturers, suppliers and component
parts assemblers.

The company's plan of operation relative to its automotive inventions over the next 12 months is

|  |                                                                                                                                                                                                                                                                                                        
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|o | to complete the infinitely variable transmission prototype as soon as possible;                                                                                                                                                                                                                        
|o | to install the infinitely variable transmission into company owned vehicles and
begin testing to document actual emission levels and fuel economy;                                                                                                                                                     
|o | to initiate discussions with national and state environmental agencies in the
United States and other countries to quantify exact fuel savings and emissions
levels and to determine the potential effect of the infinitely variable transmission
on the worldwide problem of diesel engine pollutants;
|o | to install the constant velocity joint, including its spherical gearing, into
company owned vehicles and to test and evaluate its actual operation;                                                                                                                                                    
|o | to incorporate all of the company's completed prototypes into the FTVÔ
;                                                                                                                                                                                                                               



13





|o | to continue negotiations with selected automotive and truck manufacturers to generate a letter of intent with respect to either a license, merger or joint partnership for the continued development and testing of all of the company's prototypes, their manufacture, their marketing and their worldwide sale;
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|o | to continue to improve the company's inventions and, where appropriate, to obtain patent protection on such new improvements.                                                                                                                                                                                    

While it is not management's preferred strategy, the company continues to investigate the possibility of manufacturing the FTV itself.  The company has investigated and is investigating potential sites in Rochester, New York and other communities.  The company as, as yet, not found a facility suitable for manufacturing commercial quantities of the FTV itself.  During the next 12 months, management will continue to attempt to locate a suitable facility.  The company has engaged in preliminary discussions with a number of financial institutions to formulate a financial package which, together with government based incentives, will enable the company to pursue this approach with the actual production of the vehicle.  The company believes that it will need at least 12-15 million dollars initially in order to pursue this possibility.  Management is presently investigating ways in which to acquire this amount of money, including the proceeds from Swartz as well as additional equity and/or debt financing.  However, no specific financial package with banks or other lenders has been negotiated to date.  If a suitable facility is found in the next 12 months, management will reinstitute discussions to obtain financing to acquire, refurbish, modernize, equip and staff such a facility.

On April 25, 2000, the company inaugurated its website, www.torvec.com, for marketing, sales, education and information relating to the company's inventions.

On June 29, 2000, the company announced that it had granted an exclusive, world-wide license of all its automotive technology to Variable Gear, LLC for the aeronautical and marine markets.  Variable Gear will pay the company 4% royalties for 7 years after which the company is obligated to purchase the 51% membership interest not owned.  Variable Gear is owned 51% by Robert C. Horton, Chairman and CEO of Ultrafab, Inc. and a company shareholder.  The company owns the remaining 49%.  The company does not share in any profit or losses in this entity.  Variable Gear has initiated discussions with a number of boat manufacturers, but to date, it has not commenced operations or sublicensed our automotive technology in its markets.

14



The company's overall business strategy relating to its ice technology is to:

| |   |                                                                                                                                                                                                      
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | o | develop, in cooperation with Dr. Petrenko at Dartmouth, under his one
year consulting agreement, commercially viable de-icing and
ice adhesion systems for land-based motorized vehicle applications;
| | o | to enter into appropriate licensing/joint venture arrangements; and                                                                                                                                  
| | o | to otherwise promote utilization of the company's ice technology world-wide.                                                                                                                         

The company's license agreement with Dartmouth provides for a royalty of 3.5% based on the value of net sales of licensed product with minimum annual payments of $10,000 for the first two years, $15,000 for the third year and $25,000 per year thereafter.  In addition, the agreement provides for the payment of 50% of sub-license fee income.  Based upon industry discussions, the company anticipates that it will sublicense, joint-venture or otherwise commercialize this technology within the next 12-18 months.

The net loss for the nine months ended September 30, 2001 was $2,885,000 as compared to the nine months ended September 30, 2000 net loss of $1,854,000.

Research and development expenses for the nine months ended September 30, 2001 amounted to $934,000 as compared to $505,000 for the nine months ended September 30, 2000.  This increase amounted to $429,000 and is due to increases in the amounts spent associated with improvements to the FTV and amounts spent on the transmission.

General and administrative expenses for the nine months ended September 30, 2001 amounted to $1,951,000 as compared to $1,349,000 for the nine months ended September 30, 2000.  This increase amounted to $602,000 and is due to increase in salaries for officers hired in August 2001, professional fees relating to consulting and legal services, and $398,000 in compensation expense for options granted to an officer in his capacity as consultant CFO.

15





Liquidity and Capital Resources

The company's operations during the quarter ended September 30, 2001 were funded through the sale of 12,810 shares of common stock to Swartz for aggregate proceeds of approximately $46,425.  We estimate that at the current market prices, and our daily trading volume, we will be able to sell additional shares to Swartz during the next twelve months.

During the quarter ended September 30, 2001 the company issued 72,150 shares to business consultants under its Business Consultants Stock Plan in exchange for ongoing corporate legal services, internal accounting services, expenses associated with our two lawsuits, marketing research expenses as well as legal fees and associated expenses for ongoing patent work.

At September 30, 2001 the Company's cash position was $3,000 and had a working capital deficiency of $1,141,000.  During the nine months ended September 30, 2001 the Company has been dependent on the Swartz equity funding and the exchange of stock for services to sustain operations.  In addition, during the three months ended September 30, 2001, the Company received $92,000 in loans from stockholders to fund operations.

The company anticipates that the funding it will receive from Swartz as well as its continuing issuance of shares under its Business Consultants Stock Plan may not be adequate to fulfill its needs during the next 12 months.  The company recognizes, based on its current financial status and proposed plans and assumptions relating to its operations (including assumptions regarding the nature and extent of its prototype development program, its testing program, the ability of the company to secure adequate manufacturing and distribution relationships and market acceptance of the company's products) that, over the next twelve months, the company may be required to seek additional financing in the form of a significant equity investment by one or more investors in privately-negotiated transactions or through debt-financing or both which may significantly dilute existing stockholders.  However, other opportunities such as collaborations or license arrangements may generate additional funding.

If the company was unable to raise additional financing through equity or other opportunities in addition to monies we raise from Swartz if any, we would be forced to cancel any attempt to manufacture and distribute the company's products ourselves.  The company would have to reduce and or delay expenditures, including research and development expenditures.  The company would be forced to lengthen the timeframes set forth in this section of the report within which the company would be able to commercialize its technologies.  The company may also be forced to commercialize its technologies on terms which are less favorable than are presently being negotiated.

The company's cash position at any time during the quarter ended September 30, 2001 was directly dependent upon its success in selling stock since the company did not generate any revenues.  This trend is expected to continue through the balance of fiscal 2001.



16



The company has an obligation to purchase 51% of Variable Gear, LLC on January 1, 2008.  The purchase price is equal to 51% of the then value of Variable Gear, as determined by an independent appraiser selected by the parties.  This liability can not be estimated at this time.  We believe that contributions of cash flows from operations, financing and strategic alliances will produce sufficient cash flow to fund this obligation.

Y2K Compliance

The company currently uses a software which management believes is in "Year 2000" (Y2K) compliance.  Management continues on an ongoing basis to evaluate the current software and implement any necessary changes to remain in "Year 2000" (Y2K) compliance.

Impact of Inflation

Inflation has not had a significant impact on the company's operations to date and management is currently unable to determine the extent inflation may impact the company's operations during its fiscal quarter ending September 30, 2001.

Quarterly Fluctuations

As of September 30, 2001, the company had not engaged in significant revenue producing operations.  Once the company actually commences significant revenue producing operations, the company's operating results may fluctuate significantly from period to period as a result of a variety of factors, including purchasing patterns of consumers, the length of the company's sales cycle to key customers and distributors, the timing of the introduction of new products and product enhancements by the company and its competitors, technological factors, variations in sales by product and distribution channel, product returns, and competitive pricing.  Consequently, once the company actually commences significant revenue producing operations, the company's product revenues may vary significantly by quarter and the company's operating results may experience significant fluctuations.



17





|PART II
OTHER INFORMATION
|-------------------------
|                         
|Item 1.                  
|                         
|                         
|                         
|                         
|                         
|                         



| | As the result of such discovery, management of the company believes that MMI's earlier statements regarding the inoperability of the gimbal were false and fraudulent and that MMI knew that the first-generation pump and motor utilizing a gimbal as the constant velocity joint, as specifically designed by the Gleasmans, did not pulsate or oscillate but was instead a valuable and marketable pump and motor system which could have been rapidly commercialized.

Management therefore believes that the company has been harmed by MMI in the following important respects:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | o                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | o                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | o                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | By reason of the foregoing, management believes that MMI is liable to the plaintiffs for considerable compensatory and punitive damages in an amount to be determined at trial.  The plaintiffs have demanded a jury trial with respect to this litigation.                                                                                                                                                                                                                                                                                                                          
| | On January 2, 2001, MMI moved to dismiss the plaintiffs' complaint.  On September 24, 2001 the Court denied MMI's motion and allowed the case to proceed to trial.
19                                                                                                                                                                                                                                                                                                                                                                                                                





|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | (ii)     On February 26, 2001, the company brought suit against John Spiezio and John Doe, a/k/a "Torvec1" in the United States District Court for the Western District of New York.  The company contends that, Spiezio, John Doe and "Torvec1" either alone or acting on behalf of other persons, maliciously published numerous false and defamatory statements on the Internet worldwide website, "Raging Bull."  The company also claims that the defendant(s) intentionally interfered with the company's business to its detriment.  The company believes that as the result of the defendant(s) defamation and/or business interference, the company has sustained the following significant damages:
|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | o     an adverse effect upon the daily trading of the company's stock;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | o     an erosion of confidence among the company's current and potential shareholders;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | o     a diminution of the company's publicly trading stock value, in a range equal to at least $5.00 per share;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | o     damage to the business reputations of the company's management and officers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|The company seeks compensatory and punitive damages against the defendant(s) in an amount to be determined at trial and has demanded a jury trial.


20
|                                                                                                                                                        | On April 12, 2001 defendant(s) moved to dismiss the plaintiff's complaint on the grounds that the statements made were not malicious or defamatory, constituted protected opinion and did not injure the company.  On June 19, 2001, the company responded to the defendant's motion to dismiss, sought permission of the Court to add Elizabeth Spezio as a defendant and sought permission to assert a new cause of action against the defendant(s) for conspiracy under the Racketeer Influenced and Corrupt Organizations Act ("RICO").  The parties are awaiting the decision of the Court with respect to the company's and defendant's motion.  On October 29, 2001, the Court granted the defendant(s) motion and dismissed the company's complaint for lacking diversity and subject matter jurisdiction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                        | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | The Gleasman Litigation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                        | On August 29, 1997, McElroy Manufacturing, Inc. of Tulsa, Oklahoma, and two MMI employees (collectively "MMI"), initiated a lawsuit against Vernon and Keith Gleasman in the United States District Court for the Northern District of Oklahoma.  The company is not a party to this litigation.  The plaintiffs claimed that the Gleasmans had breached an agreement dated October 10, 1991 to market inventions developed under U.S. Patent 5,440,878 (the gimbal patent), in which MMI had an interest.  Secondly, the plaintiffs alleged that the two MMI employees should have been named as co-inventors on three other patents.  The plaintiffs also sought reimbursement of their development costs in the amount of $750,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                        | On February 6, 1998, the Court stayed all aspects of the litigation pending arbitration in New York State.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                        | Hearings were conducted before the arbitrator in 1998.  On April 22, 1999, the arbitrator issued a nonappealable decision which determined that Vernon and Keith Gleasman exclusively owned all three patents, thereby confirming that these patents, which were assigned by them to the company, are the exclusive patents of the company.  The arbitrator also determined that neither party breached the 1991 Agreement, but that, in accordance with its terms, the sum of $862,699.61 should be paid to MMI (as reimbursement for development costs) by the Gleasmans out of royalties and other sums which they may receive and that MMI was entitled to a 20% interest in all royalties and other sums received by the Gleasmans.

On June 15, 1999, MMI filed its amended complaint in the United States District Court for the Northern District of Oklahoma.  There were two causes of action.  The first cause of action sought correction of the inventorship of the subject patents.   The second cause of action sought an order confirming the arbitrator's award and, in addition, sought an order directing that the Gleasmans reimburse MMI immediately for its expenses in the amount of $862,699.61 plus interest accruing from the date of the arbitrator's award.

21



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | On March 31, 2000, the Court remanded the case to the arbitrator to clarify certain ambiguities regarding the payment and terms of his April 22, 1999 decision.  On July 10, 2000, the arbitrator issued an "Addendum and Clarification Memorandum" awarding $360,000 to MMI in partial reimbursement of its expenses.  This amount is to be paid by Vernon and Keith Gleasman, not the company.

On March 23, 2001, the Court confirmed the arbitrator's award against Vernon and Keith Gleasman for MMI's expense reimbursement in the amount of $360,000.  The Court stayed enforcement of the award until the court resolved the question of whether MMI committed fraud upon the court in bringing its lawsuit.  As a condition for the stay, Vernon and Keith Gleasman deposited $423,000 (including $63,000 interest) with the Court.

On September 24, 2001, the Court determined that even if MMI had committed fraud in bringing its lawsuit, such fraud, even if proven, did not directly relate to or influence the arbitrator's award.  The Court, therefore, confirmed the award against Vernon and Keith Gleasman.

|        | As stated above, the company is not, and never has been, a party to this litigation.  Based upon the order of the Court confirming the award against Vernon and Keith Gleasman, the company not obligated in any way to reimburse MMI for their expenses nor liable to MMI for any continuing royalty obligation or any other sums.
|------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                    
|Item 2: | Changes in SecuritiesNone                                                                                                                                                                                                                                                                                                          
|Item 3. | Defaults Upon Senior Securities
None                                                                                                                                                                                                                                                                                               
|Item 4. | Submission of Matters to a Vote of Security Holders                                                                                                                                                                                                                                                                                
|        |                                                                                                                                                                                                                                                                                                                                    
|        | None                                                                                                                                                                                                                                                                                                                               
|        |                                                                                                                                                                                                                                                                                                                                    
|Item 5. | Other Information                                                                                                                                                                                                                                                                                                                  
|        |                                                                                                                                                                                                                                                                                                                                    
|        | None                                                                                                                                                                                                                                                                                                                               
|        |                                                                                                                                                                                                                                                                                                                                    

22

|Item 6. | Exhibits and Reports on Form 8-K                                                                                                                                                                                                                          
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                           
|        | a.                                                                                                                                                                                                                                                        
|        |                                                                                                                                                                                                                                                           
|        | The following Exhibits, as applicable, are attached to this Quarterly Report  (Form 10-QSB)  The Exhibit Index is found on the page immediate succeeding the Signature Page and the Exhibits follow on the pages immediately succeeding the Exhibit Index.
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                           

23

| |  | (5)  | Opinion re: Legality                         
| |  | ---- | ---------------------------------------------
| |  |      |                                              
| |  |      | None                                         
| |  |      |                                              
| |  |      |                                              
| |  | (8)  | Opinion re: Tax Matters                      
| |  |      |                                              
| |  |      | None                                         
| |  |      |                                              
| |  | (9)  | Voting Trust Agreement Voting Trust Agreement
| |  |      |                                              
| |  |      | None                                         
| |  |      |                                              
| |  | (10) | Material Contracts                           
| |  |      |                                              
| |  |      | 10.1                                         
| |  |      |                                              
| |  |      | 10.2                                         
| |  |      |                                              
| |  |      | 10.3                                         
| |  |      |                                              
| |  |      | 10.4                                         
| |  |      |                                              

24

| |  |  | 10.5  | Operating Agreement of Variable Gear, LLC dated June 28, 2000, incorporated by reference to Form 10-QSB filed for the quarter ended June 30, 2000;                     
| |  |  | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.6  | License Agreement between Torvec, Inc. and Variable Gear, LLC dated June 28, 2000, incorporated by reference to Form SB-2 filed October 19, 2000;                      
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.7  | Extension of and Amendment to Consulting Agreement with James A. Gleasman, incorporated by reference to Form 10-KSB filed for the fiscal year ended December 31, 2000; 
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.8  | Extension of and Amendment to Consulting Agreement with Keith E. Gleasman, incorporated by reference to Form 10-KSB filed for the fiscal year ended December 31, 2000; 
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.9  | Extension of and Amendment to Consulting Agreement with Vernon E. Gleasman, incorporated by reference to Form 10-KSB filed for the fiscal year ended December 31, 2000;
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.10 | Option and Consulting Agreement with Marquis Capital, LLC dated February 10, 1999;                                                                                     
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.11 | Option and Consulting Agreement with PMC Direct Corp., dated February 10, 1999;                                                                                        
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.12 | Investment Banking Services Agreement with Swartz Institutional Finance (Dunwoody Brokerage Services, Inc.) dated December 8, 2000;                                    
| |  |  |      
| |  |  | 10.13 | Employment Agreement with Michael Martindale,
Chief Executive Officer, dated August 1, 2001;                                                                           
| |  |  |      
| |  |  | 10.14 | Employment Agreement with Jacob H. Brooks,
Chief Operating Officer, dated August 1, 2001;                                                                              
| |  |  |       |                                                                                                                                                                        
| |  |  | 10.15 | Employment Agreement with David K. Marshall,
Vice-President of Manufacturing, dated September 1, 2001;                                                                 
| |  |  |      
| |  |  | 10.16 | Investment Banking Services Agreement with Swartz
Institutional Finance (Dunwoody Brokerage Services, Inc.),
as amended, dated October 23, 2001;                       
| |  |  |      
| |  |  | 10.17 | Stock Option Agreement with Samuel Bronsky, Chief Financial and Accounting Officer, dated August 28, 2001.                                                             
| |  |  |      

25

| |    | (11)                      | Statement re computation of per share earnings (loss)                   
| | -- | ------------------------- | ------------------------------------------------------------------------
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (15)                      | Letter re unaudited interim financial information                       
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (18)                      | Letter re change in accounting principles                               
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (19)                      | Report furnished to security holders                                    
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (22)                      | Published report regarding matters submitted to vote of security holders
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (23)                      | Consents of experts and counsel                                         
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (24)                      | Power of attorney                                                       
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (99)                      | Additional exhibits                                                     
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                          
| | b. | Reports Filed on Form 8-K
| |    |                          
| |    | None.                    

26



SIGNATURES



Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

|      |                   |     | TORVEC, INC.                                                                            
|----- | ----------------- | --- | ----------------------------------------------------------------------------------------
|DATE: | November 13, 2001 | By: | /S/ KEITH E. GLEASMAN           Keith E. Gleasman
President                             
|      |                   |     |                                                                                         
|DATE: | November 13, 2001 | By: | /S/ SAMUEL M. BRONSKY           Samuel M. Bronsky
Chief Financial and Accounting Officer



27



EXHIBIT INDEX

|Exhibit |  | Page
|------- |  | ----
|        |  |     

| | (1) | Investment Agreement                                                         
| | --- | -----------------------------------------------------------------------------
| |     |                                                                              
| |     | 1.1                                                                          
| |     |                                                                              
| | (2) | Plan of Acquisition, reorganization, arrangement, liquidation, or succession.
| |     |                                                                              
| |     | 2.1                                                                          
| |     |                                                                              
| | (3) | Articles of Incorporation, By-laws                                           
| |     |                                                                              
| |     | 3.1                                                                          
| |     |                                                                              
| |     | 3.2                                                                          
| |     |                                                                              
| |     | 3.3                                                                          
| |     |                                                                              
| | (4) | Instruments defining the rights of holders including indentures              
| |     |                                                                              
| |     | None                                                                         
| |     |                                                                              
| | (5) | Opinion re: Legality                                                         
| |     |                                                                              
| |     | None                                                                         
| |     |                                                                              
| |     | 28                                                                           
| |     | (8)                                                                          
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     | (9)                                                                          
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     | (10)                                                                         
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              
| |     |                                                                              

29

| |  |  | 10.6  | License Agreement between Torvec, Inc. and Variable Gear,
LLC dated June 28, 2000, incorporated by reference to
Form SB-2 filed October 19, 2000;                                      N/A                                             
| |  |  | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |  |       |                                                                                                                                                                                                                                        
| |  |  | 10.7  | Extension of and Amendment to Consulting Agreement
with James A. Gleasman, incorporated by reference to
Form 10-KSB filed for the fiscal year ended
December 31, 2000;                                                              N/A
| |  |  |       |                                                                                                                                                                                                                                        
| |  |  | 10.8  | Extension of and Amendment to Consulting Agreement
with Keith E. Gleasman, incorporated by reference to
Form 10-KSB filed for the fiscal year ended
December 31, 2000;                                                             N/A 
| |  |  |       |                                                                                                                                                                                                                                        
| |  |  | 10.9  | Extension of and Amendment to Consulting Agreement
with Vernon E. Gleasman, incorporated by reference to
Form 10-KSB filed for the fiscal year ended
December 31, 2000;                                                             N/A
| |  |  |       |                                                                                                                                                                                                                                        
| |  |  | 10.10 | Option and Consulting Agreement with Marquis
Capital, LLC dated February 10, 1999;                                N/A                                                                                                                  
| |  |  |       |                                                                                                                                                                                                                                        
| |  |  | 10.11 | Option and Consulting Agreement with PMC
Direct Corp., dated February 10, 1999;                                N/A                                                                                                                     
| |  |  |       |                                                                                                                                                                                                                                        
| |  |  | 10.12 | Investment Banking Services Agreement with
Swartz Institutional Finance (Dunwoody Brokerage
Services, Inc.) dated December 8, 2000;                               N/A                                                                  
| |  |  |      
| |  |  | 10.13 | Employment Agreement with Michael Martindale,
Chief Executive Officer, dated August 1, 2001;                     32                                                                                                                    
| |  |  |      
| |  |  | 10.14 | Employment Agreement with Jacob H. Brooks,
Chief Operating Officer, dated August 1, 2001;                     57                                                                                                                       
| |  |  |      
| |  |  | 10.15 | Employment Agreement with David K. Marshall,
Vice-President of Manufacturing, dated
September 1, 2001;                                                                  82                                                             
| |  |  |      
| |  |  | 10.16 | Investment Banking Services Agreement with
Swartz Institutional Finance (Dunwoody Brokerage
Services, Inc.), as amended, dated October 23, 2001;            106                                                                        
| |  |  |      
| |  |  | 10.17 | Stock Option Agreement with Samuel Bronsky,
Chief Financial and Accounting Officer, dated
August 28, 2001.                                                                     110                                                     
| |  |  |      

30

| |    |                           |                                                                         
| | -- | ------------------------- | ------------------------------------------------------------------------
| |    | (11)                      | Statement re computation of per share earnings (loss)                   
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (15)                      | Letter re unaudited interim financial information                       
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (18)                      | Letter re change in accounting principles                               
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (19)                      | Report furnished to security holders                                    
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (22)                      | Published report regarding matters submitted to vote of security holders
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (23)                      | Consents of experts and counsel                                         
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (24)                      | Power of attorney                                                       
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                           |                                                                         
| |    | (99)                      | Additional exhibits                                                     
| |    |                           |                                                                         
| |    |                           | Not applicable                                                          
| |    |                          
| | b. | Reports Filed on Form 8-K
| |    |                          
| |    | None.
31                 





EMPLOYMENT AGREEMENTMichael Martindale

THIS EMPLOYMENT AGREEMENT (this "Agreement"), made this first day of August, 2001, is entered into by and between TORVEC, Inc., a New York State corporation with its principal place of business at 11 Pondview Drive, Pittsford, NY 14534 (the "Company"), and Michael Martindale, residing at 28 Jack Pine Drive, Sudbury, MA 01776 ("Employee").

WHEREAS, the Company desires to employ Employee, and Employee desires to be employed by the Company.

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

|1. | Term of Employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | The Company hereby agrees to employ Employee, and Employee hereby accepts employment with the Company, upon the terms set forth in this Agreement, for the period commencing on August 1, 2001 (the "Commencement Date") and ending on July 31, 2004 (such period, as it may be extended, the "Employment Period"), unless sooner terminated in accordance with the provisions of Section 4.                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|2. | Title; Duties and Conflicts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | Employee shall serve as an officer of the company as Chief Executive Officer or in such other position as the Company or its Board of Directors (the "Board") may determine from time to time.  He shall also serve as a Board Member. Employee shall be based at the Company's headquarters in Pittsford NY although not required to reside in the area. Employee shall be subject to the supervision of, and shall have such authority as is delegated to Employee by, the Board or such officer of the Company as may be designated by the Board.





32





| | 
| | 



Employee hereby accepts such employment and agrees to undertake the duties and responsibilities inherent in such position and such other duties and responsibilities as the Board or its designee shall from time to time reasonably assign to Employee.  Employee acknowledges that he will be required to conduct reasonable travel in the course of the performance of his duties on behalf of the Company.  Employee agrees to abide by the rules, regulations, instructions, personnel practices and policies of the Company and any changes therein which may be adopted from time to time by the Company.

During the Employment Period, Employee shall devote his full time and best efforts to the business of the Company and the performance of his duties hereunder and shall not, directly or indirectly, engage in any other business, profession or occupation for compensation or otherwise which would conflict with the rendering of such duties without the prior written consent of the Board.

|3. | Compensation and Benefits.
|-- | --------------------------
|   |                           
|   | 3.1                       
|   |                           
|   |                           
|   |                           
|   |                           
|   | 3.2                       
|   |                           
|   |                           
|   |                           

- 2 -





| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3.3 | Reimbursement of Expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | The Company shall reimburse Employee for all reasonable travel, entertainment and other expenses incurred or paid by Employee in connection with, or related to, the performance of his or her duties, responsibilities or services under this Agreement, upon presentation by Employee of documentation, expense statements, vouchers and/or such other supporting information as the Company may request; provided, however, that the amount available for such travel, entertainment and other expenses may be fixed in advance by the Board.                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 3.4 | Withholding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | All salary, bonus and other compensation payable to Employee shall be subject to applicable withholding taxes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 3.5 | Manner of Payment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | All compensation owed, accrued and/or to be paid under this Agreement as herein set forth  shall, in the discretion of the Board of Directors, be paid either in shares of TORVEC's capital stock, in cash or in a combination of both stock and cash at such time(s) as may be determined by the Board.                                                                                                                                                                                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 3.6 | Stock Options.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | There is hereby granted to the Employee an incentive stock option to purchase up to 180,000 shares of the Company's $.01 par value Common Stock at an exercise price of $5.00 per share.  The option granted hereby shall be subject to the terms and conditions set forth in the Stock Option Agreement attached hereto and made a part hereof.  The term of the option shall be for a period of 10 years, shall vest immediately, shall provide for immediate and full vesting in the event the Company is acquired and shall provide that the right to exercise the option in accordance with its terms shall survive the Employee's termination of employment.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

- 3 -





|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | --------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4. | Termination of Employment Period.
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | 4.1                               | Expiration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                   | Employee's employment hereunder shall terminate upon expiration of the Employment Period in accordance with Section 1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | 4.2                               | For Cause by the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                   | Notwithstanding any other provision of this Agreement, Employee's employment hereunder may be terminated by the Company at any time for Cause, subject to a majority vote of the Board..  For purposes of this Agreement, "Cause" shall be limited to (i) Employee's commission of any act involving fraud, embezzlement, theft, misrepresentation, dishonesty or moral turpitude, (ii) Employee's indictment for commission of a material crime on the basis of alleged facts of such a serious nature that the Company has reasonable cause to believe that Employee cannot effectively discharge his duties and responsibilities, or Employee's indictment for the commission of a material business related crime, (iii) any gross misconduct by Employee, (iv) neglect by Employee of his duties resulting in substantial loss to the Company or substantial damage to the Company's business or reputation, (v) any material breach by Employee of any non-competition or non-disclosure agreement between Employee and the Company, or (vi) other than as provided in Sub-sections (i)-(v) above, any material breach by Employee of this Agreement, if the effects and circumstances of such material breach are not fully cured and corrected within five (5) days after notice to Employee of such breach (such notice and cure period are not necessary in the event that such breach is not reasonably capable of being cured, within the Company's sole discretion).
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  



- 4 -





| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 4.3 | Disability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder may be terminated by the Company at any time in the event of the Disability of Employee.  For purposes of this Agreement, "Disability" shall mean the inability of Employee to perform substantially the duties of his position hereunder due to physical or mental disablement which continues for a period of three (3) consecutive months or for an aggregate of three (3) months during any twelve (12) month period during the Employment Period, as determined by an independent qualified physician mutually acceptable to the Company and Employee (or his personal representative) or, if the Company and Employee (or such representative) are unable to agree on an independent qualified physician, as determined by a panel of three physicians, one designated by the Company, one designated by Employee (or his personal representative) and one designated by the two physicians so designated. The company shall provide as a benefit appropriate disability insurance. All programs involving vesting will become fully vested in the event of such termination.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.4 | Death.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder shall automatically terminate in the event of Employee's death.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.5 | Without Cause by the Company or by Employee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder may be terminated at the election of the Board if terminating the Employee without cause or may be terminated by Employee, upon not less than ninety (90) days' prior written notice of termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

- 5 -



|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5. | Effect of Termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | 5.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | At-Will Employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | If the Employment Period expires pursuant to Section 1 hereof, then, unless the Company notifies Employee to the contrary, Employee shall continue his or her employment on an at-will basis following the expiration of the Employment Period.  Such at-will employment relationship shall be governed by the terms of this Agreement, except that the employment relationship may be terminated by either party at any time.                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | 5.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Payments Upon Termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | In the event Employee's employment is terminated pursuant to Section 4, the Company shall pay to Employee an amount equal to the portion of the Base Salary earned or accrued under Section 3 through the last day of his actual employment by the Company. Employee shall also be entitled to receive the lesser of 12 months or the Base Salary for the balance of the Employment Period as severance pay if he is terminated without cause by the Company and all vesting programs shall become fully vested.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|6. | Change of control.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | If the Employee is terminated or his position substantially changes as a result of change of control within six months of such change of control, Employee has the option to terminate this contract and shall be paid under the provisions of section 5.2.                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|7. | Other Agreements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Employee represents that his or her performance of all the terms of this Agreement and the performance of his or her duties as an Employee of the Company do not and will not breach any agreement with any prior employer or other party to which Employee is a party (including without limitation any nondisclosure or non-competition agreement).  Any agreement to which Employee is a party with any prior employer or relating to nondisclosure, non-competition or no-solicitation of employees or customers is listed on Schedule A attached hereto.

- 6 -



|   |                                            
|-- | -------------------------------------------
|8. | Confidentiality and Transfer of Inventions.
|   |                                            
|   | A.                                         



- 7 -



| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | B. | Employee shall promptly disclose to Employer all ideas, discoveries, designs, improvements, innovations and inventions (collectively referred to herein as "inventions"), whether patentable or not, either relating to the existing business, products, plans, processes, or procedures of Employer, or any parent or subsidiary of Employer, or suggested by or resulting from Employee's work at Employer, or resulting wholly or in part from the use of Employer's time, material, facilities or ideas, which Employee makes or conceives, in whole or in part, whether or not during working hours, alone or with others, at any time during the term of his employment pursuant to this Agreement or during the first six-month period immediately following termination of his employment for any reason, and Employee agrees that all such inventions shall be the exclusive property of Employer.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | C. | Employee hereby assigns to Employer all his rights and interests in and to all such inventions and all patents which may be obtained on them, in this or any foreign country.  At Employer's expense, but without charge to it, Employee agrees to execute, acknowledge and deliver to Employer any specific assignments to any such inventions or other relevant documents and take any such further action as may be considered necessary by Employer at any time to obtain or defend letters patent in any and all countries or to obtain documents relating to registration, ownership or transfer of copyrights, or to vest title in such inventions in Employer or its assigns or to obtain for Employer any other legal protection for such inventions.                                                                                                                                             



- 8 -



| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | D. | Because Employee shall acquire by reason of his employment and association with Employer an extensive knowledge of Employer's Trade Secrets, customers, procedures, and other confidential information, the parties hereto recognize that in the event of a breach or threat of breach by Employee of the terms and provisions contained in this Paragraph 8, compensation alone to Employer would not be an adequate remedy for a breach of those terms and provisions.  Therefore, it is agreed that in the event of a breach or threat of a breach of the provisions of  this Paragraph 8 by Employee, Employer shall be entitled to an immediate injunction from any court of competent jurisdiction restraining Employee from committing or continuing to commit a breach of such provisions without the showing or proving of actual damages.  Any preliminary injunction or restraining order shall continue in full force and effect until any and all disputes between the parties regarding this Agreement have been finally resolved on the merits by settlement or by a court of law.  Employee hereby waives any right he may have to require Employer to post a bond or other security with respect to obtaining or continuing any such injunction or temporary restraining order and, further, hereby releases Employer, its officers, directors, employees and agents from and waives any claim for damages against them which he might have with respect to Employer's obtaining in good faith any injunction or restraining order pursuant to this Agreement.  Employee agrees that any action for injunction brought pursuant to this Paragraph 8 may be brought in the New York State Supreme Court in the County of Monroe and hereby submits to the jurisdiction of that court and waives any objection as to venue.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | E. | The provisions of this Paragraph 8 shall survive the termination of this Agreement and bind the Employee for a period of 2 years after his termination of employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

- 9 -





|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|9.  | Non-compete.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Employee acknowledges that his promised services hereunder are of special, unique, unusual and extraordinary character which gives them peculiar value, the loss of which cannot adequately be compensated in damages in an action at law, and Employee further acknowledges that in his capacity hereunder he will be making use of, acquiring and adding to confidential information of special and unique value relating to the affairs of the Company, its subsidiaries and affiliates, including but not limited to its financial affairs, new products, marketing plans, and costs of providing its products. In addition to and not in limitation of any other restrictive covenants which may be binding upon Employee, Employee agrees that he will not (except for the benefit of or with the written consent of the Company, its successors or assigns) during the term of this Agreement and for a period of 2 years thereafter, in any area in which duties have at any time been assigned to him by Employer, hereunder engage (as an individual or as a stockholder, partner, member, agent, employee or representative of any person, firm, corporation, limited liability company or partnership, or association), or have any interest, direct or indirect, in any entity developing or producing  products or related business in competition with the business of the Company; provided that this paragraph shall not prevent the Employee from acquiring and holding shares of stock of the Company and not to exceed 2% percent of the outstanding shares of stock of any other corporation which engages in a related business if such shares are available to the general public on a national securities exchange or NASDAQ.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10. | Miscellaneous.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | 10.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

- 10 -



| |  |                                                                                                                                                                                                    
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | if to the Company, to:                                                                                                                                                                             
| |  |                                                                                                                                                                                                    
| |  | TORVEC, Inc.
11 Pondview Drive
Pittsford, NY 14534 
Attention:  Keith Gleasman
Telephone:  716/248-8549
Facsimile:  716/383-0175                                                                   
| |  |                                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | with a copy to:                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | Chamberlain D'Amanda Oppenheimer and Greenfield
1600 Crossroads Buildings, Two State Street
Rochester, NY 14614-1397
Attention:  Richard Sullivan
Telephone:  716/232-3730
Facsimile:  716/232-3882
| |  |                                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | if to Employee, to:                                                                                                                                                                                
| |  |                                                                                                                                                                                                    
| |  | Michael Martindale
28 Jack Pine Drive
Sudbury, MA 01776
Telephone:  978-443-0636
Facsimile:  978-443-7379                                                                                          
| |  |                                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | with a copy to:                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | Mintz, Levin
1 Financial Center
Boston, MA 02111
Attention:  Gail Eagan
Telephone:  617-348-1728
Facsimile:                                                                                        



- 11 -



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Any party may give any notice, request, demand, claim or other communication hereunder using any other means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail or electronic mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the party for whom it is intended.  Any party may change the address to which notices, requests, demands, claims, and other communications hereunder are to be delivered by giving the other parties notice in the manner herein set forth.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.2 | Pronouns.                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa.                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.3 | Entire Agreement.                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings, whether written or oral, relating to the subject matter of this Agreement.  The parties acknowledge that there have been no oral or other agreements of any kind whatsoever as a condition precedent or inducement to the signing of this Agreement.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.4 | Amendment.                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | This Agreement may not be amended, nor shall any waiver, change, modification, consent or discharge be effected, except by an instrument in writing executed by or on behalf of the party against whom enforcement of any waiver, change, modification, consent or discharge is sought.                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 

- 12 -



| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.5 | Arbitration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | Any dispute between Employer and the Employee in any way arising out of this Agreement, other than an action for an injunction brought pursuant to Paragraph 8 of this Agreement, including the termination of Employee's employment and/or this Agreement, shall be submitted to arbitration by an arbitrator selected by the American Arbitration Association.  The arbitrator's decision with respect to any such dispute shall be final and binding.  Any such disputes must be submitted to arbitration within six (6) months of termination, cancellation, or expiration of this Agreement.  Any party who, in violation of this paragraph, initiates a lawsuit against the other party, shall pay the other party's reasonable attorney's fees and costs incurred in such lawsuit.  Except as otherwise provided herein, such arbitration shall take place in accordance with the Rules of Commercial Arbitration of the American Arbitration Association, and shall be held in Monroe County, New York.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | 10.6 | Governing Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | This Agreement shall be governed by and construed in accordance with the laws of the New York State including the choice of law provisions of New York State.  Any action for an injunction under or relating to Paragraph 8 of this Agreement shall be commenced only in a court of the New York State (or, if appropriate, a federal court located within New York State).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | 10.7 | Successors and Assigns.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | This Agreement shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any corporation with which or into which the Company may be merged or which may succeed to its assets or business; provided, however, that the obligations of Employee are personal and shall not be assigned by him.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

- 13 -



| |       |                                                                                                                                                                                                                                                                                                                                
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.8  | Practices Inconsistent with this Agreement.                                                                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | No provision of this Agreement shall be modified or construed by any practice or policy that is inconsistent with such provision, and failure by either the Employee or the Employer to comply with any provision, shall not affect the rights of either to thereafter comply or require the other to comply.                  
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.9  | Waivers.                                                                                                                                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any other right.  A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.10 | Captions.                                                                                                                                                                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.                                                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.11 | Section Headings.                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.12 | Counterparts.                                                                                                                                                                                                                                                                                                                  
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument, and in pleading or proving any provision of this Agreement, it shall not be necessary to produce more than one of such counterparts.            

- 14 -



| |       |                                                                                                                                                                                                                     
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.13 | Severability.                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                     
| |       | In case any provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability of the remaining provisions shall in no way be affected or impaired thereby.
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     



EMPLOYEE ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AGREEMENT AND UNDERSTANDS AND AGREES TO ALL OF THE PROVISIONS IN THIS AGREEMENT.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

- 15 -46



IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year set forth above.



| | TORVEC, INC.                            
| | ----------------------------------------
| |                                         
| |                                         
| | By :/S/ KEITH E. GLEASMAN               
| | KEITH E. GLEASMAN                       
| | Title:  President                       
| |                                         
| |                                         
| | EMPLOYEE                                
| |                                         
| |                                         
| | /S/ MICHAEL MARTINDALEMichael Martindale
|
| |                                         

- 16 -



SCHEDULE A



Agreements with Prior Employers



INCENTIVE STOCK OPTION AGREEMENT



THIS INCENTIVE STOCK OPTION AGREEMENT MADE as of this 1st day of August, 2001 between TORVEC, INC., a New York business corporation (herein referred to as the "Company"), and Michael Martindale (herein referred to as the "Optionee");



WITNESSETH:

1.          The Company hereby grants to the Optionee an Option (hereinafter referred to as "Option") to purchase an aggregate of 180,000 shares of the $.01 par value Common Stock of the Company (herein referred to as the "Shares") at a price of $5.00 per Share to be paid by the Optionee with cash, a certified check or a bank cashier's check made payable to the order of the Company. Alternatively, provided the Board of Directors shall approve the specific transfer, the Optionee may pay for the Shares, either in whole or in part, by the delivery of Common Stock of the Company already owned by him which will be accepted as payment for the Shares, based upon such Common Stock's fair market value on the date of exercise.  In addition, provided the Board of Directors shall approve the specific transfer, payment for the Shares, either in whole or in part, may be made by delivery of Common Stock acquired by the Optionee under any of the Company's stock option plans, provided, however, that if this Option is exercised in part, Shares acquired by such partial exercise may not be used as payment for additional Shares to be acquired under this Agreement.  In order for the Optionee to so use shares of Common Stock previously acquired under any of the Company's stock option plans as payment for the Shares either in whole or in part, the transfer of such previously acquired Common Stock as payment for all or a portion of the exercise price under this Agreement must occur more than two years from the date of the grant and one year from the date of exercise of the prior option pursuant to which the Optionee acquired such Common Stock.

2.          The term during which the Option shall be exercisable shall commence on August 1, 2001 and expire on the close of business July 31, 2011, subject to earlier termination as provided in the Torvec, Inc. 1998 Stock Option Plan (herein referred to as the "Plan").  This Option shall vest immediately and shall be exercisable in full upon the execution hereof.





However, this Option may be exercised only if the Optionee is and has been continuously an employee of the Company or its subsidiaries for a period beginning on the date of grant and ending on the day three months before the date of exercise.  If the Optionee terminates employment due to permanent and total disability, the three month period referred to in the preceding sentence shall be one year.

3.          The Option is not transferable by the Optionee other than by Will or the laws of descent and distribution and is exercisable, during his lifetime, only by the Optionee.  In the event that the right to exercise the Option passes to the Optionee's estate, or to a person to whom such right devolves by reason of the Optionee's death, then the Option shall be non transferable in the hands of the Optionee's Executor or Administrator or of such person, except that the Option may be distributed by the Optionee's Executor or Administrator to the distributees of the Optionee's estate as a part thereof.

4.          In order for the Option to be exercised, in whole or in part, the notice by the Optionee to the Company in the form attached hereto must be accompanied by payment in full of the option price for the Shares being purchased.

5.          The Optionee understands that a Registration Statement covering the Shares to be issued pursuant to the Option granted hereunder was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  The Optionee understands that, by virtue of the effectiveness of such Registration Statement, and provided he is not and has not been an "affiliate" of the Company for a period of at least three (3) months before sale, he may sell the Shares received upon the exercise of the Option granted hereunder in "open market" transactions.  The Optionee also understands that if he is an "affiliate" of the Company or has been an "affiliate" during the three (3) month period prior to sale, he may not sell freely in the open market and therefore the Optionee agrees that he will consult the Company's counsel as to the securities law restrictions on his ability to sell the Shares acquired upon exercise prior to any such sale.

6.          The Optionee hereby acknowledges receipt of the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and the Optionee further acknowledges receipt of all reports, including the annual (Form 10-KSB), quarterly (Form 10-QSB) and current (Form 8-K) reports filed with the Securities and Exchange Commission for the most recently completed fiscal year of the Company and for all interim periods immediately preceding the date of the exercise of this Option.  The Optionee further acknowledges receipt of the proxy and  all other shareholder communications, including the annual report to security holders, for the most recent annual meeting of shareholders and for any special shareholders' meetings which may have occurred since the most recent annual meeting until the date of the exercise of this Option.

- 2 -



7.         The Optionee understands and agrees that the Shares to be acquired upon the exercise of the Option may not be sold, transferred, exchanged, hypothecated, encumbered, pledged or otherwise disposed of for value for a period of six (6) months from the date of the grant of this Option.

8.          The Optionee understands that the Company has established certain policies and procedures governing trading in the Company's securities, including the Shares to be acquired upon the exercise of this Option, while in possession of material, inside information regarding the Company and/or any of its subsidiaries.  The Optionee agrees that upon exercise of this Option, either in whole or in part, he will comply with all of the terms and conditions of such policy, including the procedures and guidelines established for its implementation.  In particular, the Optionee agrees that where required under such guidelines and procedures, he will obtain permission of the Company's Clearinghouse Committee composed of senior management prior to effectuating any sale or other transfer for value of the Shares to be acquired by virtue of the exercise of this Option.

9.          All the terms and provisions of the Plan, duly adopted at a meeting of the Company's Board of Directors on December 1, 1997 and approved by a majority vote of the Company's shareholders either in person or by proxy at a duly called meeting of such shareholders held on May 26, 1998 and as amended to date, are hereby expressly incorporated into this Agreement and made a part hereof as if printed herein and the Optionee, by the Optionee's signature hereon, acknowledges receipt of a certified copy of said Plan.  If there shall be any conflict between this agreement and the Plan, the provisions of the Plan shall control.

10.          In accordance with certain terms and conditions of the Plan, the aggregate number and kind of Shares that may be purchased pursuant to the grant of the Option under this Agreement shall be proportionately adjusted by the Board of Directors for any increase, decrease or change in the total number of the outstanding shares of the Company resulting from a stock dividend, stock-split or other corporate reorganization which would result in or have the effect of the Optionee being treated differently (but for the adjustment) than he would be treated had he been the beneficial owner of the Shares subject to the Option on the record date for such dividend, split or reorganization, as the case may be.

11.          The Optionee understands that the Option granted hereunder constitutes an "incentive stock option" 
within the meaning of Section 422 of the Internal Revenue Code.  Consequently, under current provisions of federal 
tax law, if the Optionee does not dispose of the Shares for a two (2) year period from the date of grant and for a
one (1) year period from date of  exercise, no income or gain shall be recognized for regular income tax purposes
to the Optionee upon either the grant of the Option or upon his exercise of all or a portion of the Option granted

- 3 -





hereunder.  Upon the actual disposition of the Shares acquired pursuant to exercise of the Option, long or short term capital gain or loss will be recognized by the Optionee, depending upon the holding period (twelve months for long term capital gain or loss) and the extent to which the selling price exceeds or is less than the Optionee's basis in the stock.  The amount of gain will be taxed at normal, ordinary tax rates, with a maximum rate of 20% if the Shares are held for a period of at least twelve months.

The Optionee also understands that for purposes of the federal alternative minimum income tax calculation, the difference between the exercise price and the fair market value of the Shares on the date of exercise shall be includible as an item of gross income for the taxable year of exercise except to the extent that such Shares are not transferable and are subject to a substantial risk of forfeiture.

The Optionee also understands that the provisions of federal tax law described herein are subject to change and, consequently, the Optionee agrees to consult with his or her own tax advisor with respect to the tax treatment to be accorded the grant of the Option herein, the exercise of such Option, and the disposition of the Shares.

12.          Provided that the Optionee is an employee of the Company and/or any of its subsidiaries on the date this Option is exercised, either in whole or in part, the Company shall grant the Optionee a Reload Option on such exercise date.  The number of shares subject to the Reload Option shall be equal to the number of shares of the Company's Common Stock (owned by the Optionee for at least 12 months prior to such exercise date) which he shall have used to purchase the Shares underlying this Option.  The Reload Option price per share shall be equal to the fair market value of a share of the Company's Common Stock on the date the grant of the Reload Option becomes effective, that is, the date on which this Option is exercised, either in whole or in part.  Fair market value per share shall be the closing price for the Company's Common Stock as quoted on the OTC Bulletin Board, any exchange on which the Company's Common Stock is listed or NASDAQ.

The term of the Reload Option shall commence on the date this Option is exercised and shall continue for a period of ten (10) years.  The same terms conditions, limitations and restrictions that apply to the Option granted herein shall also apply to the Reload Option.

13.          Consistent with the provisions of the Plan, this Agreement shall be binding upon and inure to the benefit of any successor or assignee of the Company and to any executor, administrator, legal representative, legatee, or distributee entitled by law to the Optionee's right hereunder.

- 4 -



52





14.          Except insofar as an interpretation of federal securities law otherwise is required, or is controlling, this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its duly authorized officer and the Optionee has hereunto set his hand, as of the day and year first above written.

| |                                                         
| | --------------------------------------------------------
| | TORVEC, INC.                                            
| |                                                         
| |                                                         
| | By:/S/ KEITH E. GLEASMAN    KEITH E. GLEASMAN, President
|
| |                                                         
| | .                                                       
| |                                                         
| |                                                         
| | /S/ MICHAEL MARTINDALEMichael Martindale , Optionee     
|
| |                                                         

- 5 -









NOTICE OF EXERCISE OF STOCK OPTION
AND
RECORD OF STOCK TRANSFER





Torvec, Inc.
11 Pond View Drive
Pittsford, NY  14534
Gentlemen:
          I hereby exercise my Incentive Stock Option granted to me by Torvec, Inc. under an Incentive Stock Option Agreement dated August 1, 2001, subject to all the terms and provisions thereof and of the Torvec, Inc. 1998 Stock Option Plan referred to therein and notify you of my desire to purchase  Shares of the $.01 par value Common Stock of the Company which were offered to me pursuant to the Incentive Stock Option Agreement.  Enclosed is my payment in the sum of  in full payment of such Shares.

I understand that a Registration Statement covering the Shares to be issued to me pursuant to this exercise of the Option granted to me was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  Consequently, I understand that unless I am an "affiliate" of the Company, the Shares I am acquiring are freely tradable and may be sold by me in "open market" transactions.  If I am an "affiliate" of the Company, however, or have been one during the three month period prior to sale, I recognize that I may not sell freely on the open market and therefore agree that I will consult the Company's counsel as to the securities law restrictions on my ability to sell the Shares.

I also understand that under the Plan, and in accordance with the terms of the Incentive Stock Option Agreement, I may not sell, assign, alienate, pledge, encumber or otherwise transfer for value the Shares unless a period of six (6) months has elapsed from the date of the grant of the Option to me.

I acknowledge that I am aware that the Company has established a policy with respect to trading in its securities while in possession of material inside information regarding the Company and/or its subsidiaries, and that, in accordance with certain guidelines and procedures designed to implement such policy, I may be required to obtain permission from a Clearinghouse Committee, composed of Senior Management, prior to any sale or other transfer for value of the Shares hereby acquired.









I also acknowledge that I have received and have read the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and all proxy and other shareholder communications, including the annual report to security holders, for the most recently completed fiscal year and all quarterly and current updates thereof.  I acknowledge that I have received all documents incorporated by reference in the Prospectus and the Registration Statement filed with the Securities and Exchange Commission that I requested and have read the same.  I acknowledge that I have had the opportunity to ask questions of and receive answers from the Company's management concerning the information set forth in such Prospectus, reports and updates and have been satisfied with the answers provided regarding the same.

Finally, I acknowledge that there are significant federal income tax consequences resulting from my exercise of this Option, that I have consulted with and received advice from qualified tax counsel both as to the nature of such tax consequences and their impact upon my own personal income tax situation as the result of such exercise, and that I fully understand such impact and have planned accordingly.





|DATED | 
|----- | 
|      | 

- 2 -









Receipt is hereby acknowledged of the delivery to me by Torvec, Inc. on  ____________  of stock certificates for  shares of $.01 par value common stock purchased by me pursuant to the terms and conditions of the Torvec, Inc. 1998 Stock Option Plan referred to above.



|DATED: | 
|------ | 
|       | 

- 3 -





EMPLOYMENT AGREEMENT

Jacob H. Brooks





THIS EMPLOYMENT AGREEMENT (this "Agreement"), made this first day of August, 2001, is entered into by and between TORVEC, Inc., a New York State corporation with its principal place of business at 11 Pondview Drive, Pittsford, NY 14534 (the "Company"), and Jacob H. Brooks, residing at 229 Alder Lane, Boulder, Colorado 80304 ("Employee").

WHEREAS, the Company desires to employ Employee, and Employee desires to be employed by the Company.

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

|1. | Term of Employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | The Company hereby agrees to employ Employee, and Employee hereby accepts employment with the Company, upon the terms set forth in this Agreement, for the period commencing on August 1, 2001 (the "Commencement Date") and ending on July 31, 2004 (such period, as it may be extended, the "Employment Period"), unless sooner terminated in accordance with the provisions of Section 4.                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|2. | Title; Duties and Conflicts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | Employee shall serve as an officer of the company as Chief Operating Officer or in such other position as the Company or its Board of Directors (the "Board") may determine from time to time.  He shall also serve as a Board Member. Employee shall be based at the Company's headquarters in Pittsford NY although not required to reside in the area. Employee shall be subject to the supervision of, and shall have such authority as is delegated to Employee by, the Board or such officer of the Company as may be designated by the Board.









| | 
| | 



Employee hereby accepts such employment and agrees to undertake the duties and responsibilities inherent in such position and such other duties and responsibilities as the Board or its designee shall from time to time reasonably assign to Employee.  Employee acknowledges that he will be required to conduct reasonable travel in the course of the performance of his duties on behalf of the Company.  Employee agrees to abide by the rules, regulations, instructions, personnel practices and policies of the Company and any changes therein which may be adopted from time to time by the Company.

During the Employment Period, Employee shall devote his full time and best efforts to the business of the Company and the performance of his duties hereunder and shall not, directly or indirectly, engage in any other business, profession or occupation for compensation or otherwise which would conflict with the rendering of such duties without the prior written consent of the Board.

|3. | Compensation and Benefits.
|-- | --------------------------
|   |                           
|   | 3.1                       
|   |                           
|   |                           
|   |                           
|   |                           
|   | 3.2                       
|   |                           
|   |                           
|   |                           

- 2 -





| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3.3 | Reimbursement of Expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | The Company shall reimburse Employee for all reasonable travel, entertainment and other expenses incurred or paid by Employee in connection with, or related to, the performance of his or her duties, responsibilities or services under this Agreement, upon presentation by Employee of documentation, expense statements, vouchers and/or such other supporting information as the Company may request; provided, however, that the amount available for such travel, entertainment and other expenses may be fixed in advance by the Board.                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 3.4 | Withholding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | All salary, bonus and other compensation payable to Employee shall be subject to applicable withholding taxes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 3.5 | Manner of Payment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | All compensation owed, accrued and/or to be paid under this Agreement as herein set forth shall, in the discretion of the Board of Directors, be paid either in shares of TORVEC's capital stock, in cash or in a combination of both stock and cash at such time(s) as may be determined by the Board.                                                                                                                                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | 3.6 | Stock Options.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | There is hereby granted to the Employee an incentive stock option to purchase up to 180,000 shares of the Company's $.01 par value Common Stock at an exercise price of $5.00 per share.  The option granted hereby shall be subject to the terms and conditions set forth in the Stock Option Agreement attached hereto and made a part hereof.  The term of the option shall be for a period of 10 years, shall vest immediately, shall provide for immediate and full vesting in the event the Company is acquired and shall provide that the right to exercise the option in accordance with its terms shall survive the Employee's termination of employment.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

- 3 -





|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | --------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4. | Termination of Employment Period.
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | 4.1                               | Expiration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                   | Employee's employment hereunder shall terminate upon expiration of the Employment Period in accordance with Section 1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | 4.2                               | For Cause by the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                   | Notwithstanding any other provision of this Agreement, Employee's employment hereunder may be terminated by the Company at any time for Cause, subject to a majority vote of the Board..  For purposes of this Agreement, "Cause" shall be limited to (i) Employee's commission of any act involving fraud, embezzlement, theft, misrepresentation, dishonesty or moral turpitude, (ii) Employee's indictment for commission of a material crime on the basis of alleged facts of such a serious nature that the Company has reasonable cause to believe that Employee cannot effectively discharge his duties and responsibilities, or Employee's indictment for the commission of a material business related crime, (iii) any gross misconduct by Employee, (iv) neglect by Employee of his duties resulting in substantial loss to the Company or substantial damage to the Company's business or reputation, (v) any material breach by Employee of any non-competition or non-disclosure agreement between Employee and the Company, or (vi) other than as provided in Sub-sections (i)-(v) above, any material breach by Employee of this Agreement, if the effects and circumstances of such material breach are not fully cured and corrected within five (5) days after notice to Employee of such breach (such notice and cure period are not necessary in the event that such breach is not reasonably capable of being cured, within the Company's sole discretion).
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

- 4 -





| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 4.3 | Disability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder may be terminated by the Company at any time in the event of the Disability of Employee.  For purposes of this Agreement, "Disability" shall mean the inability of Employee to perform substantially the duties of his position hereunder due to physical or mental disablement which continues for a period of three (3) consecutive months or for an aggregate of three (3) months during any twelve (12) month period during the Employment Period, as determined by an independent qualified physician mutually acceptable to the Company and Employee (or his personal representative) or, if the Company and Employee (or such representative) are unable to agree on an independent qualified physician, as determined by a panel of three physicians, one designated by the Company, one designated by Employee (or his personal representative) and one designated by the two physicians so designated. The company shall provide as a benefit appropriate disability insurance. All programs involving vesting will become fully vested in the event of such termination.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.4 | Death.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder shall automatically terminate in the event of Employee's death.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.5 | Without Cause by the Company or by Employee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder may be terminated at the election of the Board if terminating the Employee without cause or may be terminated by Employee, upon not less than ninety (90) days' prior written notice of termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               



- 5 -





|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5. | Effect of Termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | 5.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | At-Will Employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | If the Employment Period expires pursuant to Section 1 hereof, then, unless the Company notifies Employee to the contrary, Employee shall continue his or her employment on an at-will basis following the expiration of the Employment Period.  Such at-will employment relationship shall be governed by the terms of this Agreement, except that the employment relationship may be terminated by either party at any time.                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | 5.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Payments Upon Termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | In the event Employee's employment is terminated pursuant to Section 4, the Company shall pay to Employee an amount equal to the portion of the Base Salary earned or accrued under Section 3 through the last day of his actual employment by the Company. Employee shall also be entitled to receive the lesser of 12 months or the Base Salary for the balance of the Employment Period as severance pay if he is terminated without cause by the Company and all vesting programs shall become fully vested.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|6. | Change of control.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | If the Employee is terminated or his position substantially changes as a result of change of control within six months of such change of control, Employee has the option to terminate this contract and shall be paid under the provisions of section 5.2.                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|7. | Other Agreements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Employee represents that his or her performance of all the terms of this Agreement and the performance of his or her duties as an Employee of the Company do not and will not breach any agreement with any prior employer or other party to which Employee is a party (including without limitation any nondisclosure or non-competition agreement).  Any agreement to which Employee is a party with any prior employer or relating to nondisclosure, non-competition or no-solicitation of employees or customers is listed on Schedule A attached hereto.

- 6 -



|   |                                            
|-- | -------------------------------------------
|8. | Confidentiality and Transfer of Inventions.
|   |                                            
|   | A.                                         



-7 -





| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | B. | Employee shall promptly disclose to Employer all ideas, discoveries, designs, improvements, innovations and inventions (collectively referred to herein as "inventions"), whether patentable or not, either relating to the existing business, products, plans, processes, or procedures of Employer, or any parent or subsidiary of Employer, or suggested by or resulting from Employee's work at Employer, or resulting wholly or in part from the use of Employer's time, material, facilities or ideas, which Employee makes or conceives, in whole or in part, whether or not during working hours, alone or with others, at any time during the term of his employment pursuant to this Agreement or during the first six-month period immediately following termination of his employment for any reason, and Employee agrees that all such inventions shall be the exclusive property of Employer.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | C. | Employee hereby assigns to Employer all his rights and interests in and to all such inventions and all patents which may be obtained on them, in this or any foreign country.  At Employer's expense, but without charge to it, Employee agrees to execute, acknowledge and deliver to Employer any specific assignments to any such inventions or other relevant documents and take any such further action as may be considered necessary by Employer at any time to obtain or defend letters patent in any and all countries or to obtain documents relating to registration, ownership or transfer of copyrights, or to vest title in such inventions in Employer or its assigns or to obtain for Employer any other legal protection for such inventions.                                                                                                                                             



- 8 -





| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | D. | Because Employee shall acquire by reason of his employment and association with Employer an extensive knowledge of Employer's Trade Secrets, customers, procedures, and other confidential information, the parties hereto recognize that in the event of a breach or threat of breach by Employee of the terms and provisions contained in this Paragraph 8, compensation alone to Employer would not be an adequate remedy for a breach of those terms and provisions.  Therefore, it is agreed that in the event of a breach or threat of a breach of the provisions of  this Paragraph 8 by Employee, Employer shall be entitled to an immediate injunction from any court of competent jurisdiction restraining Employee from committing or continuing to commit a breach of such provisions without the showing or proving of actual damages.  Any preliminary injunction or restraining order shall continue in full force and effect until any and all disputes between the parties regarding this Agreement have been finally resolved on the merits by settlement or by a court of law.  Employee hereby waives any right he may have to require Employer to post a bond or other security with respect to obtaining or continuing any such injunction or temporary restraining order and, further, hereby releases Employer, its officers, directors, employees and agents from and waives any claim for damages against them which he might have with respect to Employer's obtaining in good faith any injunction or restraining order pursuant to this Agreement. Employee agrees that any action for injunction brought pursuant to this Paragraph 8 may be brought in the New York State Supreme Court in the County of Monroe and hereby submits to the jurisdiction of that court and waives any objection as to venue.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | E. | The provisions of this Paragraph 8 shall survive the termination of this Agreement and bind the Employee for a period of 2 years after his termination of employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          



- 9 -



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|9.  | Non-compete.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Employee acknowledges that his promised services hereunder are of special, unique, unusual and extraordinary character which gives them peculiar value, the loss of which cannot adequately be compensated in damages in an action at law, and Employee further acknowledges that in his capacity hereunder he will be making use of, acquiring and adding to confidential information of special and unique value relating to the affairs of the Company, its subsidiaries and affiliates, including but not limited to its financial affairs, new products, marketing plans, and costs of providing its products. In addition to and not in limitation of any other restrictive covenants which may be binding upon Employee, Employee agrees that he will not (except for the benefit of or with the written consent of the Company, its successors or assigns) during the term of this Agreement and for a period of 2 years thereafter, in any area in which duties have at any time been assigned to him by Employer, hereunder engage (as an individual or as a stockholder, partner, member, agent, employee or representative of any person, firm, corporation, limited liability company or partnership, or association), or have any interest, direct or indirect, in any entity developing or producing  products or related business in competition with the business of the Company; provided that this paragraph shall not prevent the Employee from acquiring and holding shares of stock of the Company and not to exceed 2% percent of the outstanding shares of stock of any other corporation which engages in a related business if such shares are available to the general public on a national securities exchange or NASDAQ.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10. | Miscellaneous.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | 10.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

- 10 -

66





| |  |                                                                                                                                                                                                    
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | if to the Company, to:                                                                                                                                                                             
| |  |                                                                                                                                                                                                    
| |  | TORVEC, Inc.
11 Pond View Drive
Pittsford, NY 14534 
Attention:  Keith Gleasman
Telephone:  716/248-8549
Facsimile:  716/383-0175                                                                  
| |  |                                                                                                                                                                                                    
| |  | with a copy to:                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | Chamberlain D'Amanda Oppenheimer and Greenfield
1600 Crossroads Buildings, Two State Street
Rochester, NY 14614-1397
Attention:  Richard Sullivan
Telephone:  716/232-3730
Facsimile:  716/232-3882
| |  |                                                                                                                                                                                                    
| |  | if to Employee, to:                                                                                                                                                                                
| |  |                                                                                                                                                                                                    
| |  | Jacob H. Brooks
229 Alder Lane
Boulder, CO 80304
Telephone:  (970) 748-9262
Facsimile:                                                                                                             
| |  |                                                                                                                                                                                                    
| |  | with a copy to:                                                                                                                                                                                    
| |  |                                                                                                                                                                                                    
| |  | Mintz, Levin
1 Financial Center
Boston, MA 02111
Attention:  Gail Eagan
Telephone:  617-348-1728
Facsimile:                                                                                        



- 11 -





|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Any party may give any notice, request, demand, claim or other communication hereunder using any other means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail or electronic mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the party for whom it is intended.  Any party may change the address to which notices, requests, demands, claims, and other communications hereunder are to be delivered by giving the other parties notice in the manner herein set forth.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.2 | Pronouns.                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa.                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.3 | Entire Agreement.                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings, whether written or oral, relating to the subject matter of this Agreement.  The parties acknowledge that there have been no oral or other agreements of any kind whatsoever as a condition precedent or inducement to the signing of this Agreement.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.4 | Amendment.                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | This Agreement may not be amended, nor shall any waiver, change, modification, consent or discharge be effected, except by an instrument in writing executed by or on behalf of the party against whom enforcement of any waiver, change, modification, consent or discharge is sought.                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 

- 12 -







| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.5 | Arbitration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | Any dispute between Employer and the Employee in any way arising out of this Agreement, other than an action for an injunction brought pursuant to Paragraph 8 of this Agreement, including the termination of Employee's employment and/or this Agreement, shall be submitted to arbitration by an arbitrator selected by the American Arbitration Association.  The arbitrator's decision with respect to any such dispute shall be final and binding.  Any such disputes must be submitted to arbitration within six (6) months of termination, cancellation, or expiration of this Agreement.  Any party who, in violation of this paragraph, initiates a lawsuit against the other party, shall pay the other party's reasonable attorney's fees and costs incurred in such lawsuit.  Except as otherwise provided herein, such arbitration shall take place in accordance with the Rules of Commercial Arbitration of the American Arbitration Association, and shall be held in Monroe County, New York.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | 10.6 | Governing Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | This Agreement shall be governed by and construed in accordance with the laws of the New York State including the choice of law provisions of New York State.  Any action for an injunction under or relating to Paragraph 8 of this Agreement shall be commenced only in a court of the New York State (or, if appropriate, a federal court located within New York State).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | 10.7 | Successors and Assigns.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | This Agreement shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any corporation with which or into which the Company may be merged or which may succeed to its assets or business; provided, however, that the obligations of Employee are personal and shall not be assigned by him.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                



- 13 -





| |       |                                                                                                                                                                                                                                                                                                                                
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.8  | Practices Inconsistent with this Agreement.                                                                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | No provision of this Agreement shall be modified or construed by any practice or policy that is inconsistent with such provision, and failure by either the Employee or the Employer to comply with any provision, shall not affect the rights of either to thereafter comply or require the other to comply.                  
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.9  | Waivers.                                                                                                                                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any other right.  A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.10 | Captions.                                                                                                                                                                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.                                                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.11 | Section Headings.                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.12 | Counterparts.                                                                                                                                                                                                                                                                                                                  
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument, and in pleading or proving any provision of this Agreement, it shall not be necessary to produce more than one of such counterparts.            

- 14 -



| |       |                                                                                                                                                                                                                     
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.13 | Severability.                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                     
| |       | In case any provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability of the remaining provisions shall in no way be affected or impaired thereby.
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     



EMPLOYEE ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AGREEMENT AND UNDERSTANDS AND AGREES TO ALL OF THE PROVISIONS IN THIS AGREEMENT.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]



- 15 -

71

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year set forth above.



| | TORVEC, INC.                      
| | ----------------------------------
| |                                   
| |                                   
| | By:/S/ KEITH E. GLEASMAN          
| | KEITH E. GLEASMAN                 
| | Title: President                  
| |                                   
| |                                   
| | EMPLOYEE                          
| |                                   
| |                                   
| | /S/ JACOB H. BROOKSJacob H. Brooks
| |                                   
| |                                   

- 16 -



SCHEDULE A
Agreements with Prior Employers



INCENTIVE STOCK OPTION AGREEMENT



THIS INCENTIVE STOCK OPTION AGREEMENT MADE as of this 1st day of August, 2001 between TORVEC, INC., a New York business corporation (herein referred to as the "Company"), and Jacob H. Brooks (herein referred to as the "Optionee");



WITNESSETH:

1.          The Company hereby grants to the Optionee an Option (hereinafter referred to as "Option") to purchase an aggregate of 180,000 shares of the $.01 par value Common Stock of the Company (herein referred to as the "Shares") at a price of $5.00 per Share to be paid by the Optionee with cash, a certified check or a bank cashier's check made payable to the order of the Company. Alternatively, provided the Board of Directors shall approve the specific transfer, the Optionee may pay for the Shares, either in whole or in part, by the delivery of Common Stock of the Company already owned by him which will be accepted as payment for the Shares, based upon such Common Stock's fair market value on the date of exercise.  In addition, provided the Board of Directors shall approve the specific transfer, payment for the Shares, either in whole or in part, may be made by delivery of Common Stock acquired by the Optionee under any of the Company's stock option plans, provided, however, that if this Option is exercised in part, Shares acquired by such partial exercise may not be used as payment for additional Shares to be acquired under this Agreement.  In order for the Optionee to so use shares of Common Stock previously acquired under any of the Company's stock option plans as payment for the Shares either in whole or in part, the transfer of such previously acquired Common Stock as payment for all or a portion of the exercise price under this Agreement must occur more than two years from the date of the grant and one year from the date of exercise of the prior option pursuant to which the Optionee acquired such Common Stock.

2.          The term during which the Option shall be exercisable shall commence on August 1, 2001 and expire on the close of business July 31, 2011, subject to earlier termination as provided in the Torvec, Inc. 1998 Stock Option Plan (herein referred to as the "Plan").  This Option shall vest immediately and shall be exercisable in full upon the execution hereof.





However, this Option may be exercised only if the Optionee is and has been continuously an employee of the Company or its subsidiaries for a period beginning on the date of grant and ending on the day three months before the date of exercise.  If the Optionee terminates employment due to permanent and total disability, the three month period referred to in the preceding sentence shall be one year.

3.          The Option is not transferable by the Optionee other than by Will or the laws of descent and distribution and is exercisable, during his lifetime, only by the Optionee.  In the event that the right to exercise the Option passes to the Optionee's estate, or to a person to whom such right devolves by reason of the Optionee's death, then the Option shall be non transferable in the hands of the Optionee's Executor or Administrator or of such person, except that the Option may be distributed by the Optionee's Executor or Administrator to the distributees of the Optionee's estate as a part thereof.

4.          In order for the Option to be exercised, in whole or in part, the notice by the Optionee to the Company in the form attached hereto must be accompanied by payment in full of the option price for the Shares being purchased.

5.          The Optionee understands that a Registration Statement covering the Shares to be issued pursuant to the Option granted hereunder was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  The Optionee understands that, by virtue of the effectiveness of such Registration Statement, and provided he is not and has not been an "affiliate" of the Company for a period of at least three (3) months before sale, he may sell the Shares received upon the exercise of the Option granted hereunder in "open market" transactions.  The Optionee also understands that if he is an "affiliate" of the Company or has been an "affiliate" during the three (3) month period prior to sale, he may not sell freely in the open market and therefore the Optionee agrees that he will consult the Company's counsel as to the securities law restrictions on his ability to sell the Shares acquired upon exercise prior to any such sale.

6.          The Optionee hereby acknowledges receipt of the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and the Optionee further acknowledges receipt of all reports, including the annual (Form 10-KSB), quarterly (Form 10-QSB) and current (Form 8-K) reports filed with the Securities and Exchange Commission for the most recently completed fiscal year of the Company and for all interim periods immediately preceding the date of the exercise of this Option.  The Optionee further acknowledges receipt of the proxy and  all other shareholder communications, including the annual report to security holders, for the most recent annual meeting of shareholders and for any special shareholders' meetings which may have occurred since the most recent annual meeting until the date of the exercise of this Option.



- 2 -



7.          The Optionee understands and agrees that the Shares to be acquired upon the exercise of the Option may not be sold, transferred, exchanged, hypothecated, encumbered, pledged or otherwise disposed of for value for a period of six (6) months from the date of the grant of this Option.

8.          The Optionee understands that the Company has established certain policies and procedures governing trading in the Company's securities, including the Shares to be acquired upon the exercise of this Option, while in possession of material, inside information regarding the Company and/or any of its subsidiaries.  The Optionee agrees that upon exercise of this Option, either in whole or in part, he will comply with all of the terms and conditions of such policy, including the procedures and guidelines established for its implementation.  In particular, the Optionee agrees that where required under such guidelines and procedures, he will obtain permission of the Company's Clearinghouse Committee composed of senior management prior to effectuating any sale or other transfer for value of the Shares to be acquired by virtue of the exercise of this Option.

9.          All the terms and provisions of the Plan, duly adopted at a meeting of the Company's Board of Directors on December 1, 1997 and approved by a majority vote of the Company's shareholders either in person or by proxy at a duly called meeting of such shareholders held on May 26, 1998 and as amended to date, are hereby expressly incorporated into this Agreement and made a part hereof as if printed herein and the Optionee, by the Optionee's signature hereon, acknowledges receipt of a certified copy of said Plan.  If there shall be any conflict between this agreement and the Plan, the provisions of the Plan shall control.

10.          In accordance with certain terms and conditions of the Plan, the aggregate number and kind of Shares that may be purchased pursuant to the grant of the Option under this Agreement shall be proportionately adjusted by the Board of Directors for any increase, decrease or change in the total number of the outstanding shares of the Company resulting from a stock dividend, stock-split or other corporate reorganization which would result in or have the effect of the Optionee being treated differently (but for the adjustment) than he would be treated had he been the beneficial owner of the Shares subject to the Option on the record date for such dividend, split or reorganization, as the case may be.

11.          The Optionee understands that the Option granted hereunder constitutes an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code.  Consequently, under current provisions of federal tax law, if the Optionee does not dispose of the Shares for a two (2) year period from the date of grant and for a one (1) year period from date of exercise, no income or gain shall be recognized for regular income tax purposes to the Optionee upon either the grant of the Option or upon his exercise of all or a portion of the Option granted hereunder.  Upon the actual disposition of the Shares



- 3 -





acquired pursuant to exercise of the Option, long or short term capital gain or loss will be recognized by the Optionee, depending upon the holding period (twelve months for long term capital gain or loss) and the extent to which the selling price exceeds or is less than the Optionee's basis in the stock.  The amount of gain will be taxed at normal, ordinary tax rates, with a maximum rate of 20% if the Shares are held for a period of at least twelve months.

The Optionee also understands that for purposes of the federal alternative minimum income tax calculation, the difference between the exercise price and the fair market value of the Shares on the date of exercise shall be includible as an item of gross income for the taxable year of exercise except to the extent that such Shares are not transferable and are subject to a substantial risk of forfeiture.

The Optionee also understands that the provisions of federal tax law described herein are subject to change and, consequently, the Optionee agrees to consult with his or her own tax advisor with respect to the tax treatment to be accorded the grant of the Option herein, the exercise of such Option, and the disposition of the Shares.

12.          Provided that the Optionee is an employee of the Company and/or any of its subsidiaries on the date this Option is exercised, either in whole or in part, the Company shall grant the Optionee a Reload Option on such exercise date.  The number of shares subject to the Reload Option shall be equal to the number of shares of the Company's Common Stock (owned by the Optionee for at least 12 months prior to such exercise date) which he shall have used to purchase the Shares underlying this Option.  The Reload Option price per share shall be equal to the fair market value of a share of the Company's Common Stock on the date the grant of the Reload Option becomes effective, that is, the date on which this Option is exercised, either in whole or in part.  Fair market value per share shall be the closing price for the Company's Common Stock as quoted on the OTC Bulletin Board, any exchange on which the Company's Common Stock is listed or NASDAQ.

The term of the Reload Option shall commence on the date this Option is exercised and shall continue for a period of ten (10) years.  The same terms conditions, limitations and restrictions that apply to the Option granted herein shall also apply to the Reload Option.

13.          Consistent with the provisions of the Plan, this Agreement shall be binding upon and inure to the benefit of any successor or assignee of the Company and to any executor, administrator, legal representative, legatee, or distributee entitled by law to the Optionee's right hereunder.

- 4 -







14.          Except insofar as an interpretation of federal securities law otherwise is required, or is controlling, this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its duly authorized officer and the Optionee has hereunto set his hand, as of the day and year first above written.

| |                                                         
| | --------------------------------------------------------
| | TORVEC, INC.                                            
| |                                                         
| |                                                         
| | By:/S/ KEITH E. GLEASMAN    Keith E. Gleasman, President
|
| |                                                         

| |                                                  
| | -------------------------------------------------
| |                                                  
| |                                                  
| | /S/  JACOB H. BROOKS    Jacob H. Brooks, Optionee
|
| |                                                  

- 5 -





NOTICE OF EXERCISE OF STOCK OPTION
AND
RECORD OF STOCK TRANSFER



Torvec, Inc.
11 Pond View Drive
Pittsford, NY  14534
Gentlemen:
          I hereby exercise my Incentive Stock Option granted to me by Torvec, Inc. under an Incentive Stock Option Agreement dated August 1, 2001, subject to all the terms and provisions thereof and of the Torvec, Inc. 1998 Stock Option Plan referred to therein and notify you of my desire to purchase  Shares of the $.01 par value Common Stock of the Company which were offered to me pursuant to the Incentive Stock Option Agreement.  Enclosed is my payment in the sum of  in full payment of such Shares.

I understand that a Registration Statement covering the Shares to be issued to me pursuant to this exercise of the Option granted to me was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  Consequently, I understand that unless I am an "affiliate" of the Company, the Shares I am acquiring are freely tradable and may be sold by me in "open market" transactions.  If I am an "affiliate" of the Company, however, or have been one during the three month period prior to sale, I recognize that I may not sell freely on the open market and therefore agree that I will consult the Company's counsel as to the securities law restrictions on my ability to sell the Shares.

I also understand that under the Plan, and in accordance with the terms of the Incentive Stock Option Agreement, I may not sell, assign, alienate, pledge, encumber or otherwise transfer for value the Shares unless a period of six (6) months has elapsed from the date of the grant of the Option to me.

I acknowledge that I am aware that the Company has established a policy with respect to trading in its securities while in possession of material inside information regarding the Company and/or its subsidiaries, and that, in accordance with certain guidelines and procedures designed to implement such policy, I may be required to obtain permission from a Clearinghouse Committee, composed of Senior Management, prior to any sale or other transfer for value of the Shares hereby acquired.





I also acknowledge that I have received and have read the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and all proxy and other shareholder communications, including the annual report to security holders, for the most recently completed fiscal year and all quarterly and current updates thereof.  I acknowledge that I have received all documents incorporated by reference in the Prospectus and the Registration Statement filed with the Securities and Exchange Commission that I requested and have read the same.  I acknowledge that I have had the opportunity to ask questions of and receive answers from the Company's management concerning the information set forth in such Prospectus, reports and updates and have been satisfied with the answers provided regarding the same.

Finally, I acknowledge that there are significant federal income tax consequences resulting from my exercise of this Option, that I have consulted with and received advice from qualified tax counsel both as to the nature of such tax consequences and their impact upon my own personal income tax situation as the result of such exercise, and that I fully understand such impact and have planned accordingly.



|DATED: | 
|------ | 
|       | 



- 2 -







Receipt is hereby acknowledged of the delivery to me by Torvec, Inc. on                     of stock certificates for  shares of $.01 par value common stock purchased by me pursuant to the terms and conditions of the Torvec, Inc. 1998 Stock Option Plan referred to above.



|DATED: | 
|------ | 
|       | 

- 3 -





EMPLOYMENT AGREEMENT

David K. Marshall





THIS EMPLOYMENT AGREEMENT (this "Agreement"), made this first day of September, 2001, is entered into by and between TORVEC, Inc., a New York State corporation with its principal place of business at 11 Pondview Drive, Pittsford, NY 14534 (the "Company"), and David K. Marshall, residing at 34 Indian Meadow Drive, Northboro, MA  01532 ("Employee").

WHEREAS, the Company desires to employ Employee, and Employee desires to be employed by the Company.

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

|1. | Term of Employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | The Company hereby agrees to employ Employee, and Employee hereby accepts employment with the Company, upon the terms set forth in this Agreement, for the period commencing on September 1, 2001 (the "Commencement Date") and ending on August 31, 2004 (such period, as it may be extended, the "Employment Period"), unless sooner terminated in accordance with the provisions of Section 4.                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|2. | Title; Duties and Conflicts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | Employee shall serve as an officer of the company as Vice President, Manufacturing or in such other position as the Company or its Board of Directors (the "Board") may determine from time to time.  Employee shall be based at the Company's headquarters in Pittsford NY although not required to reside in the area. Employee shall be subject to the supervision of, and shall have such authority as is delegated to Employee by, the Board or such officer of the Company as may be designated by the Board.





| | 
| | 



Employee hereby accepts such employment and agrees to undertake the duties and responsibilities inherent in such position and such other duties and responsibilities as the Board or its designee shall from time to time reasonably assign to Employee.  Employee acknowledges that he will be required to conduct reasonable travel in the course of the performance of his duties on behalf of the Company.  Employee agrees to abide by the rules, regulations, instructions, personnel practices and policies of the Company and any changes therein which may be adopted from time to time by the Company.

During the Employment Period, Employee shall devote his full time and best efforts to the business of the Company and the performance of his duties hereunder and shall not, directly or indirectly, engage in any other business, profession or occupation for compensation or otherwise which would conflict with the rendering of such duties without the prior written consent of the Board.

|3. | Compensation and Benefits.
|-- | --------------------------
|   |                           
|   | 3.1                       
|   |                           
|   |                           
|   |                           
|   |                           
|   | 3.2                       
|   |                           
|   |                           
|   |                           





| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3.3 | Reimbursement of Expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | The Company shall reimburse Employee for all reasonable travel, entertainment and other expenses incurred or paid by Employee in connection with, or related to, the performance of his or her duties, responsibilities or services under this Agreement, upon presentation by Employee of documentation, expense statements, vouchers and/or such other supporting information as the Company may request; provided, however, that the amount available for such travel, entertainment and other expenses may be fixed in advance by the Board.                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | 3.4 | Withholding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | All salary, bonus and other compensation payable to Employee shall be subject to applicable withholding taxes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | 3.5 | Manner of Payment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | All compensation owed, accrued and/or to be paid under this Agreement as herein set forth  shall, in the discretion of the Board of Directors, be paid either in shares of TORVEC's capital stock, in cash or in a combination of both stock and cash at such time(s) as may be determined by the Board.                                                                                                                                                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | 3.6 | Stock Options.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | There is hereby granted to the Employee an incentive stock option to purchase up to 90,000 shares of the Company's $.01 par value Common Stock at an exercise price of $5.00 per share.  The option granted hereby shall be subject to the terms and conditions set forth in the Stock Option Agreement attached hereto and made a part hereof.  The term of the option shall be for a period of 10 years, shall vest immediately, shall provide for immediate and full vesting in the event the Company is acquired and shall provide that the right to exercise the option in accordance with its terms shall survive the Employee's termination of employment.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  





|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | --------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4. | Termination of Employment Period.
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | 4.1                               | Expiration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                   | Employee's employment hereunder shall terminate upon expiration of the Employment Period in accordance with Section 1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | 4.2                               | For Cause by the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                   | Notwithstanding any other provision of this Agreement, Employee's employment hereunder may be terminated by the Company at any time for Cause, subject to a majority vote of the Board..  For purposes of this Agreement, "Cause" shall be limited to (i) Employee's commission of any act involving fraud, embezzlement, theft, misrepresentation, dishonesty or moral turpitude, (ii) Employee's indictment for commission of a material crime on the basis of alleged facts of such a serious nature that the Company has reasonable cause to believe that Employee cannot effectively discharge his duties and responsibilities, or Employee's indictment for the commission of a material business related crime, (iii) any gross misconduct by Employee, (iv) neglect by Employee of his duties resulting in substantial loss to the Company or substantial damage to the Company's business or reputation, (v) any material breach by Employee of any non-competition or non-disclosure agreement between Employee and the Company, or (vi) other than as provided in Sub-sections (i)-(v) above, any material breach by Employee of this Agreement, if the effects and circumstances of such material breach are not fully cured and corrected within five (5) days after notice to Employee of such breach (such notice and cure period are not necessary in the event that such breach is not reasonably capable of being cured, within the Company's sole discretion).
|   |                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  







| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 4.3 | Disability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder may be terminated by the Company at any time in the event of the Disability of Employee.  For purposes of this Agreement, "Disability" shall mean the inability of Employee to perform substantially the duties of his position hereunder due to physical or mental disablement which continues for a period of three (3) consecutive months or for an aggregate of three (3) months during any twelve (12) month period during the Employment Period, as determined by an independent qualified physician mutually acceptable to the Company and Employee (or his personal representative) or, if the Company and Employee (or such representative) are unable to agree on an independent qualified physician, as determined by a panel of three physicians, one designated by the Company, one designated by Employee (or his personal representative) and one designated by the two physicians so designated. The company shall provide as a benefit appropriate disability insurance. All programs involving vesting will become fully vested in the event of such termination.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.4 | Death.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder shall automatically terminate in the event of Employee's death.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.5 | Without Cause by the Company or by Employee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     | Employee's employment hereunder may be terminated at the election of the Board if terminating the Employee without cause or may be terminated by Employee, upon not less than ninety (90) days' prior written notice of termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               





|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5. | Effect of Termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | 5.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | At-Will Employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | If the Employment Period expires pursuant to Section 1 hereof, then, unless the Company notifies Employee to the contrary, Employee shall continue his or her employment on an at-will basis following the expiration of the Employment Period.  Such at-will employment relationship shall be governed by the terms of this Agreement, except that the employment relationship may be terminated by either party at any time.                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | 5.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Payments Upon Termination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | In the event Employee's employment is terminated pursuant to Section 4, the Company shall pay to Employee an amount equal to the portion of the Base Salary earned or accrued under Section 3 through the last day of his actual employment by the Company. Employee shall also be entitled to receive the lesser of 12 months or the Base Salary for the balance of the Employment Period as severance pay if he is terminated without cause by the Company and all vesting programs shall become fully vested.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|6. | Change of control.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | If the Employee is terminated or his position substantially changes as a result of change of control within six months of such change of control, Employee has the option to terminate this contract and shall be paid under the provisions of section 5.2.                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|7. | Other Agreements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Employee represents that his or her performance of all the terms of this Agreement and the performance of his or her duties as an Employee of the Company do not and will not breach any agreement with any prior employer or other party to which Employee is a party (including without limitation any nondisclosure or non-competition agreement).  Any agreement to which Employee is a party with any prior employer or relating to nondisclosure, non-competition or no-solicitation of employees or customers is listed on Schedule A attached hereto.







|   |                                            
|-- | -------------------------------------------
|8. | Confidentiality and Transfer of Inventions.
|   |                                            
|   | A.                                         









| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | B. | Employee shall promptly disclose to Employer all ideas, discoveries, designs, improvements, innovations and inventions (collectively referred to herein as "inventions"), whether patentable or not, either relating to the existing business, products, plans, processes, or procedures of Employer, or any parent or subsidiary of Employer, or suggested by or resulting from Employee's work at Employer, or resulting wholly or in part from the use of Employer's time, material, facilities or ideas, which Employee makes or conceives, in whole or in part, whether or not during working hours, alone or with others, at any time during the term of his employment pursuant to this Agreement or during the first six-month period immediately following termination of his employment for any reason, and Employee agrees that all such inventions shall be the exclusive property of Employer.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | C. | Employee hereby assigns to Employer all his rights and interests in and to all such inventions and all patents which may be obtained on them, in this or any foreign country.  At Employer's expense, but without charge to it, Employee agrees to execute, acknowledge and deliver to Employer any specific assignments to any such inventions or other relevant documents and take any such further action as may be considered necessary by Employer at any time to obtain or defend letters patent in any and all countries or to obtain documents relating to registration, ownership or transfer of copyrights, or to vest title in such inventions in Employer or its assigns or to obtain for Employer any other legal protection for such inventions.                                                                                                                                             







| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | D. | Because Employee shall acquire by reason of his employment and association with Employer an extensive knowledge of Employer's Trade Secrets, customers, procedures, and other confidential information, the parties hereto recognize that in the event of a breach or threat of breach by Employee of the terms and provisions contained in this Paragraph 8, compensation alone to Employer would not be an adequate remedy for a breach of those terms and provisions.  Therefore, it is agreed that in the event of a breach or threat of a breach of the provisions of  this Paragraph 8 by Employee, Employer shall be entitled to an immediate injunction from any court of competent jurisdiction restraining Employee from committing or continuing to commit a breach of such provisions without the showing or proving of actual damages.  Any preliminary injunction or restraining order shall continue in full force and effect until any and all disputes between the parties regarding this Agreement have been finally resolved on the merits by settlement or by a court of law.  Employee hereby waives any right he may have to require Employer to post a bond or other security with respect to obtaining or continuing any such injunction or temporary restraining order and, further, hereby releases Employer, its officers, directors, employees and agents from and waives any claim for damages against them which he might have with respect to Employer's obtaining in good faith any injunction or restraining order pursuant to this Agreement.
Employee agrees that any action for injunction brought pursuant to this Paragraph 8 may be brought in the New York State Supreme Court in the County of Monroe and hereby submits to the jurisdiction of that court and waives any objection as to venue.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | E. | The provisions of this Paragraph 8 shall survive the termination of this Agreement and bind the Employee for a period of 2 years after his termination of employment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          





|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|9.  | Non-compete.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Employee acknowledges that his promised services hereunder are of special, unique, unusual and extraordinary character which gives them peculiar value, the loss of which cannot adequately be compensated in damages in an action at law, and Employee further acknowledges that in his capacity hereunder he will be making use of, acquiring and adding to confidential information of special and unique value relating to the affairs of the Company, its subsidiaries and affiliates, including but not limited to its financial affairs, new products, marketing plans, and costs of providing its products. In addition to and not in limitation of any other restrictive covenants which may be binding upon Employee, Employee agrees that he will not (except for the benefit of or with the written consent of the Company, its successors or assigns) during the term of this Agreement and for a period of 2 years thereafter, in any area in which duties have at any time been assigned to him by Employer, hereunder engage (as an individual or as a stockholder, partner, member, agent, employee or representative of any person, firm, corporation, limited liability company or partnership, or association), or have any interest, direct or indirect, in any entity developing or producing  products or related business in competition with the business of the Company; provided that this paragraph shall not prevent the Employee from acquiring and holding shares of stock of the Company and not to exceed 2% percent of the outstanding shares of stock of any other corporation which engages in a related business if such shares are available to the general public on a national securities exchange or NASDAQ.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10. | Miscellaneous.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | 10.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      



91



| |  |                                                                                                                                                                                                      
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | if to the Company, to:                                                                                                                                                                               
| |  |                                                                                                                                                                                                      
| |  | TORVEC, Inc.
11 Pondview Drive
Pittsford, NY 14534
Attention:  Keith Gleasman
Telephone:  716/248-8549
Facsimile:  716/383-0175                                                                      
| |  |                                                                                                                                                                                                      
| |  |                                                                                                                                                                                                      
| |  | with a copy to:                                                                                                                                                                                      
| |  |                                                                                                                                                                                                      
| |  | Chamberlain D'Amanda Oppenheimer and Greenfield
1600 Crossroads Buildings, Two State Street
Rochester, NY 14614-1397
Attention:  Richard Sullivan	.
Telephone:  716/232-3730
Facsimile:  716/232-3882
| |  |                                                                                                                                                                                                      
| |  |                                                                                                                                                                                                      
| |  | if to Employee, to:                                                                                                                                                                                  
| |  |                                                                                                                                                                                                      
| |  | David K. Marshall                                                                                                                                                                                    
| |  | 34 Indian Meadow Drive                                                                                                                                                                               
| |  | Northboro, MA  01532                                                                                                                                                                                 
| |  | Telephone:  303-546-9785                                                                                                                                                                             
| |  | Facsimile:    303-546-9835                                                                                                                                                                           
| |  |                                                                                                                                                                                                      
| |  |                                                                                                                                                                                                      
| |  | with a copy to:                                                                                                                                                                                      
| |  |                                                                                                                                                                                                      
| |  | Mintz, Levin
1 Financial Center
Boston, MA 02111
Attention:  Gail Eagan
Telephone:  617-348-1728
Facsimile:                                                                                          





|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Any party may give any notice, request, demand, claim or other communication hereunder using any other means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail or electronic mail), but no such notice, request, demand, claim or other communication shall be deemed to have been duly given unless and until it actually is received by the party for whom it is intended.  Any party may change the address to which notices, requests, demands, claims, and other communications hereunder are to be delivered by giving the other parties notice in the manner herein set forth.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.2 | Pronouns.                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | Whenever the context may require, any pronouns used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa.                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.3 | Entire Agreement.                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings, whether written or oral, relating to the subject matter of this Agreement.  The parties acknowledge that there have been no oral or other agreements of any kind whatsoever as a condition precedent or inducement to the signing of this Agreement.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | 10.4 | Amendment.                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      | This Agreement may not be amended, nor shall any waiver, change, modification, consent or discharge be effected, except by an instrument in writing executed by or on behalf of the party against whom enforcement of any waiver, change, modification, consent or discharge is sought.                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |      |                                                                                                                                                                                                                                                                                                                                                                                 





| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.5 | Arbitration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | Any dispute between Employer and the Employee in any way arising out of this Agreement, other than an action for an injunction brought pursuant to Paragraph 8 of this Agreement, including the termination of Employee's employment and/or this Agreement, shall be submitted to arbitration by an arbitrator selected by the American Arbitration Association.  The arbitrator's decision with respect to any such dispute shall be final and binding.  Any such disputes must be submitted to arbitration within six (6) months of termination, cancellation, or expiration of this Agreement.  Any party who, in violation of this paragraph, initiates a lawsuit against the other party, shall pay the other party's reasonable attorney's fees and costs incurred in such lawsuit.  Except as otherwise provided herein, such arbitration shall take place in accordance with the Rules of Commercial Arbitration of the American Arbitration Association, and shall be held in Monroe County, New York.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | 10.6 | Governing Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | This Agreement shall be governed by and construed in accordance with the laws of the New York State including the choice of law provisions of New York State.  Any action for an injunction under or relating to Paragraph 8 of this Agreement shall be commenced only in a court of the New York State (or, if appropriate, a federal court located within New York State).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | 10.7 | Successors and Assigns.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      | This Agreement shall be binding upon and inure to the benefit of both parties and their respective successors and assigns, including any corporation with which or into which the Company may be merged or which may succeed to its assets or business; provided, however, that the obligations of Employee are personal and shall not be assigned by him.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                





| |       |                                                                                                                                                                                                                                                                                                                                
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.8  | Practices Inconsistent with this Agreement.                                                                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | No provision of this Agreement shall be modified or construed by any practice or policy that is inconsistent with such provision, and failure by either the Employee or the Employer to comply with any provision, shall not affect the rights of either to thereafter comply or require the other to comply.                  
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.9  | Waivers.                                                                                                                                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | No delay or omission by the Company in exercising any right under this Agreement shall operate as a waiver of that or any other right.  A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.10 | Captions.                                                                                                                                                                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.                                                                                                                                            
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.11 | Section Headings.                                                                                                                                                                                                                                                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | The headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                
| |       |                                                                                                                                                                                                                                                                                                                                
| | 10.12 | Counterparts.                                                                                                                                                                                                                                                                                                                  
| |       |                                                                                                                                                                                                                                                                                                                                
| |       | This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument, and in pleading or proving any provision of this Agreement, it shall not be necessary to produce more than one of such counterparts.            







| |       |                                                                                                                                                                                                                     
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.13 | Severability.                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                     
| |       | In case any provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability of the remaining provisions shall in no way be affected or impaired thereby.
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     
| |       |                                                                                                                                                                                                                     



EMPLOYEE ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AGREEMENT AND UNDERSTANDS AND AGREES TO ALL OF THE PROVISIONS IN THIS AGREEMENT.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

96

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year set forth above.



| | TORVEC, INC.            
| | ------------------------
| |                         
| |                         
| | By:/S/ KEITH E. GLEASMAN
| |                         
| | Title:President         
| |                         
| |                         
| | EMPLOYEE                
| |                         
| |                         
| | /S/ DAVID K. MARSHALL   
| | David K. Marshall       
| |                         





SCHEDULE A



Agreements with Prior Employers



INCENTIVE STOCK OPTION AGREEMENT





THIS INCENTIVE STOCK OPTION AGREEMENT MADE as of this 1st day of September, 2001 between TORVEC, INC., a New York business corporation (herein referred to as the "Company"), and David K. Marshall (herein referred to as the "Optionee");



WITNESSETH:

1.          The Company hereby grants to the Optionee an Option (hereinafter referred to as "Option") to purchase an aggregate of 90,000 shares of the $.01 par value Common Stock of the Company (herein referred to as the "Shares") at a price of $5.00 per Share to be paid by the Optionee with cash, a certified check or a bank cashier's check made payable to the order of the Company. Alternatively, provided the Board of Directors shall approve the specific transfer, the Optionee may pay for the Shares, either in whole or in part, by the delivery of Common Stock of the Company already owned by him which will be accepted as payment for the Shares, based upon such Common Stock's fair market value on the date of exercise.  In addition, provided the Board of Directors shall approve the specific transfer, payment for the Shares, either in whole or in part, may be made by delivery of Common Stock acquired by the Optionee under any of the Company's stock option plans, provided, however, that if this Option is exercised in part, Shares acquired by such partial exercise may not be used as payment for additional Shares to be acquired under this Agreement.  In order for the Optionee to so use shares of Common Stock previously acquired under any of the Company's stock option plans as payment for the Shares either in whole or in part, the transfer of such previously acquired Common Stock as payment for all or a portion of the exercise price under this Agreement must occur more than two years from the date of the grant and one year from the date of exercise of the prior option pursuant to which the Optionee acquired such Common Stock.

2.          The term during which the Option shall be exercisable shall commence on September 1, 2001 and expire on the close of business August 31, 2011, subject to earlier termination as provided in the Torvec, Inc. 1998 Stock Option Plan (herein referred to as the "Plan").  This option shall vest immediately and be exercisable in full upon execution hereof.

However, this Option may be exercised only if the Optionee is and has been continuously an employee of the Company or its subsidiaries for a period beginning on the date of grant and ending on the day three months before the date of exercise.  If the Optionee terminates employment due to permanent and total disability, the three month period referred to in the preceding sentence shall be one year.



3.          The Option is not transferable by the Optionee other than by Will or the laws of descent and distribution and is exercisable, during his lifetime, only by the Optionee.  In the event that the right to exercise the Option passes to the Optionee's estate, or to a person to whom such right devolves by reason of the Optionee's death, then the Option shall be non transferable in the hands of the Optionee's Executor or Administrator or of such person, except that the Option may be distributed by the Optionee's Executor or Administrator to the distributees of the Optionee's estate as a part thereof.

4.          In order for the Option to be exercised, in whole or in part, the notice by the Optionee to the Company in the form attached hereto must be accompanied by payment in full of the option price for the Shares being purchased.

5.          The Optionee understands that a Registration Statement covering the Shares to be issued pursuant to the Option granted hereunder was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  The Optionee understands that, by virtue of the effectiveness of such Registration Statement, and provided he is not and has not been an "affiliate" of the Company for a period of at least three (3) months before sale, he may sell the Shares received upon the exercise of the Option granted hereunder in "open market" transactions.  The Optionee also understands that if he is an "affiliate" of the Company or has been an "affiliate" during the three (3) month period prior to sale, he may not sell freely in the open market and therefore the Optionee agrees that he will consult the Company's counsel as to the securities law restrictions on his ability to sell the Shares acquired upon exercise prior to any such sale.

6.          The Optionee hereby acknowledges receipt of the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and the Optionee further acknowledges receipt of all reports, including the annual (Form 10-KSB), quarterly (Form 10-QSB) and current (Form 8-K) reports filed with the Securities and Exchange Commission for the most recently completed fiscal year of the Company and for all interim periods immediately preceding the date of the exercise of this Option.  The Optionee further acknowledges receipt of the proxy and  all other shareholder communications, including the annual report to security holders, for the most recent annual meeting of shareholders and for any special shareholders' meetings which may have occurred since the most recent annual meeting until the date of the exercise of this Option.

7          The Optionee understands and agrees that the Shares to be acquired upon the exercise of the Option may not be sold, transferred, exchanged, hypothecated, encumbered, pledged or otherwise disposed of for value for a period of six (6) months from the date of the grant of this Option.



8.          The Optionee understands that the Company has established certain policies and procedures governing trading in the Company's securities, including the Shares to be acquired upon the exercise of this Option, while in possession of material, inside information regarding the Company and/or any of its subsidiaries.  The Optionee agrees that upon exercise of this Option, either in whole or in part, he will comply with all of the terms and conditions of such policy, including the procedures and guidelines established for its implementation.  In particular, the Optionee agrees that where required under such guidelines and procedures, he will obtain permission of the Company's Clearinghouse Committee composed of senior management prior to effectuating any sale or other transfer for value of the Shares to be acquired by virtue of the exercise of this Option.

9.          All the terms and provisions of the Plan, duly adopted at a meeting of the Company's Board of Directors on December 1, 1997 and approved by a majority vote of the Company's shareholders either in person or by proxy at a duly called meeting of such shareholders held on May 26, 1998 and as amended to date, are hereby expressly incorporated into this Agreement and made a part hereof as if printed herein and the Optionee, by the Optionee's signature hereon, acknowledges receipt of a certified copy of said Plan.  If there shall be any conflict between this agreement and the Plan, the provisions of the Plan shall control.

10.          In accordance with certain terms and conditions of the Plan, the aggregate number and kind of Shares that may be purchased pursuant to the grant of the Option under this Agreement shall be proportionately adjusted by the Board of Directors for any increase, decrease or change in the total number of the outstanding shares of the Company resulting from a stock dividend, stock-split or other corporate reorganization which would result in or have the effect of the Optionee being treated differently (but for the adjustment) than he would be treated had he been the beneficial owner of the Shares subject to the Option on the record date for such dividend, split or reorganization, as the case may be.

11.          The Optionee understands that the Option granted hereunder constitutes an "incentive stock option" within the meaning of Section 422 of the Internal Revenue Code.  Consequently, under current provisions of federal tax law, if the Optionee does not dispose of the Shares for a two (2) year period from the date of grant and for a one (1) year period from date of exercise, no income or gain shall be recognized for regular income tax purposes to the Optionee upon either the grant of the Option or upon his exercise of all or a portion of the Option granted hereunder.  Upon the actual disposition of the Shares acquired pursuant to exercise of the Option, long or short term capital gain or loss will be recognized by the Optionee, depending upon the holding period (twelve months for long term capital gain or loss) and the extent to which the selling price exceeds or is less than the Optionee's basis in the stock.  The amount of gain will be taxed at normal, ordinary tax rates, with a maximum rate of 20% if the Shares are held for a period of at least twelve months.



The Optionee also understands that for purposes of the federal alternative minimum income tax calculation, the difference between the exercise price and the fair market value of the Shares on the date of exercise shall be includible as an item of gross income for the taxable year of exercise except to the extent that such Shares are not transferable and are subject to a substantial risk of forfeiture.

The Optionee also understands that the provisions of federal tax law described herein are subject to change and, consequently, the Optionee agrees to consult with his or her own tax advisor with respect to the tax treatment to be accorded the grant of the Option herein, the exercise of such Option, and the disposition of the Shares.

12.          Provided that the Optionee is an employee of the Company and/or any of its subsidiaries on the date this Option is exercised, either in whole or in part, the Company shall grant the Optionee a Reload Option on such exercise date.  The number of shares subject to the Reload Option shall be equal to the number of shares of the Company's Common Stock (owned by the Optionee for at least 12 months prior to such exercise date) which he shall have used to purchase the Shares underlying this Option.  The Reload Option price per share shall be equal to the fair market value of a share of the Company's Common Stock on the date the grant of the Reload Option becomes effective, that is, the date on which this Option is exercised, either in whole or in part.  Fair market value per share shall be the closing price for the Company's Common Stock as quoted on the OTC Bulletin Board, any exchange on which the Company's Common Stock is listed or NASDAQ.

The term of the Reload Option shall commence on the date this Option is exercised and shall continue for a period of ten (10) years.  The same terms conditions, limitations and restrictions that apply to the Option granted herein shall also apply to the Reload Option.

13.          Consistent with the provisions of the Plan, this Agreement shall be binding upon and inure to the benefit of any successor or assignee of the Company and to any executor, administrator, legal representative, legatee, or distributee entitled by law to the Optionee's right hereunder.

14.          Except insofar as an interpretation of federal securities law otherwise is required, or is controlling, this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its duly authorized officer and the Optionee has hereunto set his hand, as of the day and year first above written.

| | TORVEC, INC.               
| | ---------------------------
| |                            
| | By:  /S/ KEITH E. GLEASMAN 
| | Title:President            
| |                            
| | /S/ DAVID K. MARSHALL      
| | David K. Marshall, Optionee
| |                            





NOTICE OF EXERCISE OF STOCK OPTION

AND

RECORD OF STOCK TRANSFER





Torvec, Inc.

11 Pond View Drive

Pittsford, NY  14534

Gentlemen:

I hereby exercise my Incentive Stock Option granted to me by Torvec, Inc. under an Incentive Stock Option Agreement dated September 1, 2001, subject to all the terms and provisions thereof and of the Torvec, Inc. 1998 Stock Option Plan referred to therein and notify you of my desire to purchase  Shares of the $.01 par value Common Stock of the Company which were offered to me pursuant to the Incentive Stock Option Agreement.  Enclosed is my payment in the sum of  in full payment of such Shares.

I understand that a Registration Statement covering the Shares to be issued to me pursuant to this exercise of the Option granted to me was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  Consequently, I understand that unless I am an "affiliate" of the Company, the Shares I am acquiring are freely tradable and may be sold by me in "open market" transactions.  If I am an "affiliate" of the Company, however, or have been one during the three month period prior to sale, I recognize that I may not sell freely on the open market and therefore agree that I will consult the Company's counsel as to the securities law restrictions on my ability to sell the Shares.

I also understand that under the Plan, and in accordance with the terms of the Incentive Stock Option Agreement, I may not sell, assign, alienate, pledge, encumber or otherwise transfer for value the Shares unless a period of six (6) months has elapsed from the date of the grant of the Option to me.

I acknowledge that I am aware that the Company has established a policy with respect to trading in its securities while in possession of material inside information regarding the Company and/or its subsidiaries, and that, in accordance with certain guidelines and procedures designed to implement such policy, I may be required to obtain permission from a Clearinghouse Committee, composed of Senior Management, prior to any sale or other transfer for value of the Shares hereby acquired.



I also acknowledge that I have received and have read the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and all proxy and other shareholder communications, including the annual report to security holders, for the most recently completed fiscal year and all quarterly and current updates thereof.  I acknowledge that I have received all documents incorporated by reference in the Prospectus and the Registration Statement filed with the Securities and Exchange Commission that I requested and have read the same.  I acknowledge that I have had the opportunity to ask questions of and receive answers from the Company's management concerning the information set forth in such Prospectus, reports and updates and have been satisfied with the answers provided regarding the same.

Finally, I acknowledge that there are significant federal income tax consequences resulting from my exercise of this Option, that I have consulted with and received advice from qualified tax counsel both as to the nature of such tax consequences and their impact upon my own personal income tax situation as the result of such exercise, and that I fully understand such impact and have planned accordingly.





|DATED: | 
|------ | 
|       | 



104





Receipt is hereby acknowledged of the delivery to me by Torvec, Inc. on                     of stock certificates for shares of $.01 par value common stock purchased by me pursuant to the terms and conditions of the Torvec, Inc. 1998 Stock Option Plan referred to above.



|DATED: | 
|------ | 
|       | 





S W A R T Z



|Company:                                                                                             | Torvec, Inc. ("Torvec")                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|---------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Investment Banker:                                                                                   | Dunwoody Brokerage Services, Inc. d/b/a Swartz Institutional Finance ("Swartz").                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Strategic Partnerships,
Licensing Agreements,
Mergers and
Acquisition Partners
introduced by Swartz: | Entities introduced by Swartz to Torvec and entities introduced to Torvec by the aforementioned entities shall be referred to as "Strategic Partners."  All potential introductions shall be initially submitted in writing by Swartz and confirmed in writing via Schedule A by Torvec prior to being pursed by Swartz.  For Strategic Partners, or affiliates thereof, who make an investment into Torvec or into whom Torvec makes an investment or enters into a strategic partnership, licensing agreement, stock swap deal, merger, acquisition or any other transaction with Torvec (collectively referred to as "Covered Transactions"), Torvec shall pay Swartz a fee of 7% of the Transaction Value (as defined below) of the transaction between Torvec and the Strategic Partners payable in cash or Torvec Common Stock ("Stock"), at Swartz' option, at the time of closing of each transaction.  To the extent that Swartz is paid in Stock, then the Stock will be valued at the Market Price (as defined below) on the closing date of such transaction.  In addition to the payment of the cash or Stock fee, Swartz shall receive Warrants to purchase a number of shares of Torvec Common Stock equal to 7% of the Transaction Value divided by the Market Price on the closing date of such transaction, exercisable at such Market Price, plus 7% of the number of Warrants issued to the Strategic Investor (if any), exercisable at Market Price.
|                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Transaction Value and
Transactions with no
Defined Transaction
Value:                                | "Transaction Value" shall mean the dollar amount or value of the subject transaction, provided that the value of any transaction arranged by Swartz, which does not entail a defined dollar amount will be a defined dollar or Stock value determined by Torvec and Swartz in writing prior to closing (the "Defined Value").  For any such transaction, Swartz shall receive from Torvec 7% of the Defined Value payable in cash or Stock at Swartz' option.  In addition, Swartz shall receive a Warrant to purchase a number of Common Shares equal to 7% of the Defined Value, divided by Market Price, exercisable at Market Price, plus 7% of the number of Warrants issued to the Strategic Investor (if any), exercisable at Market Price.  On each anniversary of the closing date thereafter, a new Defined Value shall be determined by two independent third parties, knowledgeable and experienced in that particular field or industry, acceptable to both Swartz and Torvec.  In the event the Defined Value on any anniversary is greater than the highest Defined Value upon which Swartz has been compensated (the amount of such difference being referred to as a "Compensation Shortfall Amount"), Swartz shall receive the above stated fee and Warrants on such Compensation Shortfall Amount.                                                                                                                                                    

300 Colonial Center Parkway, Suite 300
Roswell, GA  30076phone770-640-8130fax770-643-0279
Securities offered through Dunwoody Brokerage Services, Inc.  A registered broker/dealer, Atlanta, GA  770.640.0011.   Member NASD/SIPC

106



|Market Price:                                                    | Market Price shall equal the lesser of (i) the lowest closing bid price of the Common Stock for the 5 trading days immediately preceding the date of execution by Torvec of a Letter of Intent to complete a Covered Transaction, or (ii) the lowest closing bid price of the Common Stock for the 5 trading days immediately preceding the closing date of a Covered Transaction.                                                                                
|---------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Other Funding sources
Introduced by Swartz:                      | In the event Swartz introduces Torvec to a Third Party Funding Source (as defined below), Swartz shall receive a fee equal to 7% of the amount invested or placed by the Third Party Funding Source plus a number of Warrants equal to 7% of the amount invested divided by Market Price exercisable at such Market Price.  A Third Party Funding Source is, but not limited to, an Investment Bank, Broker/Dealer or Securities Broker.                          
|                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Disputes as to
Transaction Value,
Defined Value or Market
Price: | Should the parties hereto not agree on the Defined Value, Transaction Value, or Market Price as each is defined above, Torvec agrees to forego and not circumvent Swartz with respect to any transaction with any Strategic Partners, or any affiliate thereof, until such time as the parties hereto can agree on the Defined Value.                                                                                                                             
|                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|No-Circumvention:                                                | Any potential Investor or Strategic Partner (a Swartz Client) to whom Swartz introduces Torvec shall be considered, for purposes of this Agreement, the property of Swartz ("Swartz Client").  In the event that Torvec enters into a Covered Transaction with a Swartz Client for a period of 36 months from the date of written confirmation of introduction of said Swartz Client, Torvec agrees to pay to Swartz a fee as stated above at the time of closing.
|                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|No Obligation:                                                   | Torvec may, in its sole and absolute discretion, choose not to close any Covered Transaction with any Swartz Client.  Torvec shall have no obligation to pay Swartz any fees or issue any Stock or warrants to Swartz to the extent Torvec rejects such Covered Transaction.                                                                                                                                                                                      
|                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Warrants Referenced in
this Agreement:                           | Warrants referenced herein shall have piggyback registration rights, reset provisions, shall have anti-dilution provisions following any reverse-stock-splits and shall have a 5-year term.  Anti-dilution rights are activated upon certain events which include but are not limited to stock splits, stock reclassifications, stock dividends, corporate reorganizations and mergers.                                                                           



107



|Termination: | Torvec and Swartz have the right to submit written notice of their respective intent to terminate the Agreement.  This Agreement, except as to the Non-Circumvention Section, shall be deemed terminated within 30 days of receipt of the written notice of termination from either Torvec or Swartz.
|------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|DUNWOODY BROKERAGE SERVICES, INC.
By: /S/ ROBERT HOPKINSRobert Hopkins, President
Date: 10-23-2001SWARTZ INSTITUTIONAL FINANCE
By: /S/ ERIC SWARTZEric Swartz, OSJ
Date: 10-23-2001 | TORVEC, INC.
By:  /S/ KEITH E. GLEASMANPrint Name:  KEITH E. GLEASMAN
Title: PRESIDENTDate: 10-23-2001
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------



108



S W A R T Z





Pursuant to the executed Investment Banking Services Agreement ("Agreement"), dated __________ ___, 2001, Torvec hereby confirms that Swartz has permission to introduce Torvec to:

o

The above named company(ies) shall be covered under the terms as agreed upon the executed Agreement.  This signed Schedule A will act as written confirmation for Swartz to make this/these introduction(s).





TORVEC, INC.

By:  ____________________________________
Print Name: ______________________________
Title: ____________________________________
Date: ____________________________________

300 Colonial Center Parkway, Suite 300
Roswell, GA  30076phone 770-640-8130  fax 770-643-0279
Securities offered through Dunwoody Brokerage Services, Inc.  A registered broker/dealer, Atlanta, GA  770.640.0011.   Member NASD/SIPC

Torvec Investment Banking Services                                                    Page 4

109







STOCK OPTION AGREEMENT

THIS STOCK OPTION AGREEMENT MADE as of this 28th day of August, 2001 between TORVEC, INC., a New York business corporation (herein referred to as the "Company"), and SAMUEL M. BRONSKY (herein referred to as the "Optionee");

WITNESSETH:

1.          The Company hereby grants to the Optionee an Option (hereinafter referred to as "Option") to purchase an aggregate of 100,000 shares of the $.01 par value Common Stock of the Company (herein referred to as the "Shares") at a price of $5.00 per Share to be paid by the Optionee with cash, a certified check or a bank cashier's check made payable to the order of the Company. Alternatively, provided the Board of Directors shall approve the specific transfer, the Optionee may pay for the Shares, either in whole or in part, by the delivery of Common Stock of the Company already owned by him which will be accepted as payment for the Shares, based upon such Common Stock's fair market value on the date of exercise.  In addition, provided the Board of Directors shall approve the specific transfer, payment for the Shares, either in whole or in part, may be made by delivery of Common Stock acquired by the Optionee under any of the Company's stock option plans, provided, however, that if this Option is exercised in part, Shares acquired by such partial exercise may not be used as payment for additional Shares to be acquired under this Agreement.  In order for the Optionee to so use shares of Common Stock previously acquired under any of the Company's stock option plans as payment for the Shares either in whole or in part, the transfer of such previously acquired Common Stock as payment for all or a portion of the exercise price under this Agreement must occur more than two years from the date of the grant and one year from the date of exercise of the prior option pursuant to which the Optionee acquired such Common Stock.

2.          The term during which the Option shall be exercisable shall commence on August 28, 2001 and expire on the close of business August 27, 2011, subject to earlier termination as provided in the Torvec, Inc. 1998 Stock Option Plan (herein referred to as the "Plan").  This option shall vest immediately and be exercisable in full upon execution hereof.

3.          The Option is not transferable by the Optionee other than by Will or the laws of descent and distribution and is exercisable, during his lifetime, only by the Optionee.  In the event that the right to exercise the Option passes to the Optionee's estate, or to a person to whom such right devolves by reason of the Optionee's death, then the Option shall be non transferable in the hands of the Optionee's Executor or Administrator or of such person, except that the Option may be distributed by the Optionee's Executor or Administrator to the distributees of the Optionee's estate as a part thereof.

4.          In order for the Option to be exercised, in whole or in part, the notice by the Optionee to the Company in the form attached hereto must be accompanied by payment in full of the option price for the Shares being purchased.

110



5.          The Optionee understands that a Registration Statement covering the Shares to be issued pursuant to the Option granted hereunder was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  The Optionee understands that, by virtue of the effectiveness of such Registration Statement, and provided he is not and has not been an "affiliate" of the Company for a period of at least three (3) months before sale, he may sell the Shares received upon the exercise of the Option granted hereunder in "open market" transactions.  The Optionee also understands that if he is an "affiliate" of the Company or has been an "affiliate" during the three (3) month period prior to sale, he may not sell freely in the open market and therefore the Optionee agrees that he will consult the Company's counsel as to the securities law restrictions on his ability to sell the Shares acquired upon exercise prior to any such sale.

6.          The Optionee hereby acknowledges receipt of the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and the Optionee further acknowledges receipt of all reports, including the annual (Form 10-KSB), quarterly (Form 10-QSB) and current (Form 8-K) reports filed with the Securities and Exchange Commission for the most recently completed fiscal year of the Company and for all interim periods immediately preceding the date of the exercise of this Option.  The Optionee further acknowledges receipt of the proxy and  all other shareholder communications, including the annual report to security holders, for the most recent annual meeting of shareholders and for any special shareholders' meetings which may have occurred since the most recent annual meeting until the date of the exercise of this Option.

7.         The Optionee understands and agrees that the Shares to be acquired upon the exercise of the Option may not be sold, transferred, exchanged, hypothecated, encumbered, pledged or otherwise disposed of for value for a period of six (6) months from the date of the grant of this Option.

8.          The Optionee understands that the Company has established certain policies and procedures governing trading in the Company's securities, including the Shares to be acquired upon the exercise of this Option, while in possession of material, inside information regarding the Company and/or any of its subsidiaries.  The Optionee agrees that upon exercise of this Option, either in whole or in part, he will comply with all of the terms and conditions of such policy, including the procedures and guidelines established for its implementation.  In particular, the Optionee agrees that where required under such guidelines and procedures, he will obtain permission of the Company's Clearinghouse Committee composed of senior management prior to effectuating any sale or other transfer for value of the Shares to be acquired by virtue of the exercise of this Option.

9.          All the terms and provisions of the Plan, duly adopted at a meeting of the Company's Board of Directors on December 1, 1997 and approved by a majority vote of the Company's shareholders either in person or by proxy at a duly called meeting of such shareholders held on May 26, 1998 and as amended to date, are hereby expressly incorporated

111

into this Agreement and made a part hereof as if printed herein and the Optionee, by the Optionee's signature hereon, acknowledges receipt of a certified copy of said Plan.  If there shall be any conflict between this agreement and the Plan, the provisions of the Plan shall control.

10.          In accordance with certain terms and conditions of the Plan, the aggregate number and kind of Shares that may be purchased pursuant to the grant of the Option under this Agreement shall be proportionately adjusted by the Board of Directors for any increase, decrease or change in the total number of the outstanding shares of the Company resulting from a stock dividend, stock-split or other corporate reorganization which would result in or have the effect of the Optionee being treated differently (but for the adjustment) than he would be treated had he been the beneficial owner of the Shares subject to the Option on the record date for such dividend, split or reorganization, as the case may be.

11.          The Optionee understands that the Option granted hereunder constitutes a "nonqualified stock option" for federal, and if applicable, state income tax purposes.  Consequently, the Optionee understands that under current provisions of federal tax law, for regular as well as for purposes to the federal alternative minimum income tax, no gain or loss generally is recognized to the Optionee upon the grant of the Option.  In addition, the Company will receive no business expense deduction as a result of the grant of the Option.

For federal income tax purposes, upon the exercise of the Option, the difference between the exercise price and the fair market value of the Shares on the date of exercise constitutes ordinary income to the Optionee and is taxed to the Optionee at normal, ordinary tax rates, except to the extent the Shares are not transferable and are subject to a substantial risk of forfeiture.  To the extent such difference is required to be included as income by the Optionee, the Company is entitled to a business expense deduction.  Upon the later sale of the Shares, long or short term capital gain or loss will be recognized by the Optionee, depending upon the holding period (twelve months for long term capital gain or loss) and the extent to which the selling price exceeds or is less than the Optionee's basis in the stock.  The amount of gain will be taxed at normal, ordinary tax rates, with a maximum rate of 20% if the Shares are held for a period of at least twelve months.

The Optionee also understands that the provisions of federal tax law described herein are subject to change and, consequently, the Optionee agrees to consult with his or her own tax advisor with respect to the tax treatment to be accorded the grant of the Option herein, the exercise of such Option, and the disposition of the Shares.

12.          Provided that the Optionee is an consultant of the Company and/or any of its 
subsidiaries on the date this Option is exercised, either in whole or in part, the Company shall
grant the Optionee a Reload Option on such exercise date.  The number of shares subject to the 
Reload Option shall be equal to the number of shares of the Company's Common Stock (owned 
by the Optionee for at least 12 months prior to such exercise date) which he shall have used to 
purchase the Shares underlying this Option.  The Reload Option price per share shall be equal to
the fair market value of a share of the Company's Common Stock on the date the grant of the 
Reload Option becomes effective, that is, the date on which this Option is exercised, either in

112

whole or in part.  Fair market value per share shall be the closing price for the Company's Common Stock as quoted on the OTC Bulletin Board, any exchange on which the Company's Common Stock is listed or NASDAQ.

The term of the Reload Option shall commence on the date this Option is exercised and shall continue for a period of ten (10) years.  The same terms conditions, limitations and restrictions that apply to the Option granted herein shall also apply to the Reload Option.

13.          Consistent with the provisions of the Plan, this Agreement shall be binding upon and inure to the benefit of any successor or assignee of the Company and to any executor, administrator, legal representative, legatee, or distributee entitled by law to the Optionee's right hereunder.

14.          Except insofar as an interpretation of federal securities law otherwise is required, or is controlling, this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its duly authorized officer and the Optionee has hereunto set his hand, as of the day and year first above written.

| | TORVEC, INC.                
| | ----------------------------
| |                             
| |                             
| | By:  /S/ KEITH E. GLEASMAN  
| | Keith E. Gleasman, President
| |                             
| |                             
| |                             
| | /S/ SAMUEL M. BRONSKY       
| | Samuel M. Bronsky, Optionee 
| |                             

113



NOTICE OF EXERCISE OF STOCK OPTION
AND
RECORD OF STOCK TRANSFER

Torvec, Inc.
11 Pond View Drive
Pittsford, NY  14534
Gentlemen:
          I hereby exercise my Stock Option granted to me by Torvec, Inc. under a Stock Option Agreement dated August 28, 2001, subject to all the terms and provisions thereof and of the Torvec, Inc. 1998 Stock Option Plan referred to therein and notify you of my desire to purchase ____________ Shares of the $.01 par value Common Stock of the Company which were offered to me pursuant to the Stock Option Agreement.  Enclosed is my payment in the sum of $_____________ in full payment of such Shares.

I understand that a Registration Statement covering the Shares to be issued to me pursuant to this exercise of the Option granted to me was filed with the Securities and Exchange Commission on December 17, 1998.  The Registration Statement became effective on December 17, 1998.  Consequently, I understand that unless I am an "affiliate" of the Company, the Shares I am acquiring are freely tradable and may be sold by me in "open market" transactions.  If I am an "affiliate" of the Company, however, or have been one during the three month period prior to sale, I recognize that I may not sell freely on the open market and therefore agree that I will consult the Company's counsel as to the securities law restrictions on my ability to sell the Shares.

I also understand that under the Plan, and in accordance with the terms of the Stock Option Agreement, I may not sell, assign, alienate, pledge, encumber or otherwise transfer for value the Shares unless a period of six (6) months has elapsed from the date of the grant of the Option to me.

I acknowledge that I am aware that the Company has established a policy with respect to trading in its securities while in possession of material inside information regarding the Company and/or its subsidiaries, and that, in accordance with certain guidelines and procedures designed to implement such policy, I may be required to obtain permission from a Clearinghouse Committee, composed of Senior Management, prior to any sale or other transfer for value of the Shares hereby acquired.

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I also acknowledge that I have received and have read the Prospectus dated December 17, 1998 prepared by the Company in connection with the grant of the Option contained herein, together with its exhibits, and all proxy and other shareholder communications, including the annual report to security holders, for the most recently completed fiscal year and all quarterly and current updates thereof.  I acknowledge that I have received all documents incorporated by reference in the Prospectus and the Registration Statement filed with the Securities and Exchange Commission that I requested and have read the same.  I acknowledge that I have had the opportunity to ask questions of and receive answers from the Company's management concerning the information set forth in such Prospectus, reports and updates and have been satisfied with the answers provided regarding the same.

Finally, I acknowledge that there are significant federal income tax consequences resulting from my exercise of this Option, that I have consulted with and received advice from qualified tax counsel both as to the nature of such tax consequences and their impact upon my own personal income tax situation as the result of such exercise, and that I fully understand such impact and have planned accordingly.



|DATED: | 
|------ | 

115





Receipt is hereby acknowledged of the delivery to me by Torvec, Inc. on                     of stock certificates for  shares of $.01 par value common stock purchased by me pursuant to the terms and conditions of the Torvec, Inc. 1998 Stock Option Plan referred to above.



|DATED: | 
|------ | 
|       | 

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