Exhibit 10.27




	SEVERANCE AGREEMENT

	AGREEMENT made as of this 23rd day of June, 2000 between
Jerry McAuliffe, residing at 8 Billwood Drive, Monroe, New York
10950 (the "Executive"), and Electronic Retailing Systems
International, Inc., a Delaware corporation (the "Company").

	W I T N E S S E T H:

	WHEREAS, the Board of Directors of the Company (the "Board")
has determined that it is in the best interests of the Company and
its stockholders to assure that the Company shall have the
continued dedication of the Executive;

	NOW, THEREFORE, it is hereby agreed as follows:

	SECTION I

	CERTAIN DEFINITIONS

	As used in this Agreement, the following capitalized terms
shall have the meanings set forth below.

	(a)	The term "Affiliate" shall mean any person controlling,
controlled by or under common control with the subject referenced.

	(b)	The term "Cause" shall mean:

		(i) the failure of the Executive to perform
substantially the Executive's duties with the Company or any
of its Affiliates (other than any such failure resulting from
incapacity due to physical or mental illness), which failure
remains uncured for a period of 30 days after a written
notice for substantial performance is delivered to the
Executive by the Board or the chief executive officer of the
Company which identifies the manner in which the Board or
chief executive officer believes that the Executive has not
substantially performed the Executive's duties, or

		(ii)	engaging by the Executive in illegal conduct or
gross misconduct which is materially and demonstrably
injurious to the Company; or

		(iii)	conviction of a crime (other than misdemeanor
traffic offenses) or commission of an act of moral turpitude.

	(c)	The term "Change of Control" shall mean:


		(i)	 The acquisition by any Person of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under
the Securities Exchange Act of 1934) of 50% or more of the
combined voting power of the Company's outstanding voting
securities; provided, however, that the following
acquisitions shall not constitute a Change of Control: (A)
any acquisition directly from the Company, (B) any
acquisition by the Company, or (C) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any Affiliate of the Company; or

		(ii)	Individuals who, as of the date hereof,
constitute the Incumbent Board cease for any reason to
constitute at least a majority of the Board, unless they are
replaced with a slate nominated by at least a majority of the
Incumbent Board, and further provided that any individual
becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority
of the directors then comprising the Incumbent Board shall,
for purposes of this clause (ii), be considered as though
such individual were a member of the Incumbent Board; or

		(iii)	Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or
substantially all of the assets of the Company, in each case,
unless, following such transaction: (A) all or substantially
all of the individuals and entities who were the beneficial
owners, respectively, of the Company's outstanding voting
securities immediately prior to such transaction beneficially
own, directly or indirectly, more than 50% of the combined
voting power of the then outstanding voting securities of the
corporation resulting from such transaction (including,
without limitation, a corporation which as a result of such
transaction owns the Company or all or substantially all of
the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such transaction, of the
Company's outstanding voting securities; (B) no Person
beneficially owns, directly or indirectly, 50% or more of the
combined voting power of the then outstanding voting
securities of such corporation except to the extent that such
ownership existed prior to such transaction; and (C) at least
a majority of the members of the board of directors of the
corporation resulting from such transaction were members of
the Incumbent Board, or were nominated by at least a majority
of the members of the Incumbent Board, at the time of the
execution of the initial agreement, or by the action of the
Board, providing for such transaction; or

		(iv)	Approval by the stockholders of the Company of
a complete liquidation or dissolution of the Company.

	(d)	The term "Common Stock" shall mean the Company's
common stock, $.01 par value.

	(e)	The term "Date of Termination" shall mean: (i) if the
Executive's employment is terminated by the Company for Cause or
Disability, or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later date specified
therein, as the case may be, or (ii) if the Executive's employment
is terminated by the Company for other than Cause or Disability,
the date on which the Company notifies the Executive of such
termination.

	(f)	The term "Disability" shall mean the absence of the
Executive from the Executive's duties with the Company on a
full-time basis for 120 consecutive business days as a result of
incapacity due to mental or physical illness which is determined
to be total and permanent by a physician selected by the Company
and reasonably acceptable to the Executive or the Executive's
legal representative.

	(g)	The term "Good Reason" shall mean:

		(i)	the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position
(including status, offices, titles and reporting
requirements), authority, duties or responsibilities at least
commensurate in all material respects with the most
significant of those held, exercised and assigned at any time
during the 120-day period immediately preceding the date
hereof, or any other action by the Company which results in a
diminution in such position, authority, duties or
responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith
and which is remedied by the Company promptly after receipt
of notice thereof given by the Executive; or

		(ii)	subject to reasonable assessment by the Company
of the performance of the Executive, adjustments in the base
salary of the Executive or determination of achievement of
bonus entitlement or calculation of stock option grants, in
each case not at least substantially commensurate with the
treatment by the Company with respect to other peer
executives of the Company; or

		(iii)	the Company's requiring the Executive to relocate
his principal residence from its current location; or

		(iv)	any purported termination by the Company of the
Executive's employment otherwise than for "cause".

	(h)	The term "Incumbent Board" shall mean the individuals
who, as of the date hereof, constitute the Board.

	(i)  The term "Inventions" shall mean all inventions new
contributions, improvements, ideas and discoveries, whether
patentable or not, conceived, developed, invented or made solely
by the Executive, or jointly with others, during the term of
employment with the Company or its Affiliates, relating in any way
to the business of the Company or its Affiliates.

	(j)	The term "Notice of Termination" means a written notice
which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth
in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive's employment
under the provision so indicated and (iii) if the Date of
Termination is other than the date of such notice, specifies the
termination date (which date shall be not more than thirty days
after the giving of such notice).

	(k)	The term "Person" shall mean any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934).

	(l)	The term "Plan" shall mean the Company's 1993 Employee
Stock Option Plan and any successor thereto.

	(m)  The term "Welfare Benefit Plans" shall mean all welfare
benefit plans, practices, policies and programs provided by the
Company and its Affiliates (including, without limitation,
medical, prescription, dental, disability, employee life, group
life, accidental death and travel accident insurance plans and
programs) to the extent applicable generally to other peer
executives of the Company and its Affiliates.

	SECTION II

	STOCK OPTIONS

	(a) Stock Option Acceleration. Any and all agreements
heretofore entered into between the Executive and the Company in
evidence of options exercisable with respect to shares of Common
Stock granted pursuant to the Plan shall be appropriately amended
so that the options granted thereunder shall become immediately
exercisable upon termination of the Executive's employment (x) by
the Company, other than for Cause or Disability, or (y) by the
Executive for Good Reason, in each case under clauses (x) or (y),
within the twelve-month period immediately following the
occurrence of a Change of Control; provided, however, that
exercisability subsequent to a Change of Control shall continue to
be governed by and subject to any performance criteria (other than
solely the passage of time) set forth therein. The Executive and
the Company further agree that any subsequent grant of stock
options by the Company under the Plan (which shall be subject to
action by the Board, in its sole discretion) shall become
immediately exercisable upon termination of the Executive's
employment (x) by the Company, other than for Cause or Disability,
or (y) by the Executive for Good Reason, in each case under
clauses (x) or (y), within the twelve-month period immediately
following the occurrence of a Change of Control, and that any and
all agreements in evidence thereof shall appropriately reflect
such arrangements; provided, however, that exercisability
subsequent to a Change of Control may continue to be governed by
and subject to any performance criteria (other than solely the
passage of time) set forth therein.

	(b) Stock Option Term. Any and all agreements heretofore
entered into between the Executive and the Company in evidence of
options exercisable with respect to shares of Common Stock granted
pursuant to the Plan shall be appropriately amended so that: (x)
the definition of "Cause" herein shall be substituted for the
definition of "cause" therein; and (y) the options granted
thereunder shall terminate on the earliest of (1) the last day of
the Exercise Period (as defined in such option), (2) two years
after the Executive ceases to be an employee, or (3) upon
termination of the Executive's employment for Cause by action of
his employer or by the Executive at such time as the Company shall
have grounds to terminate the Executive's employment for Cause.
The Executive and the Company further agree that any subsequent
grant of stock options by the Company under the Plan (which shall
be subject to action by the Board, in its sole discretion) shall
terminate on the earliest of (1) the last day of the Exercise
Period (as defined in such option), (2) two years after the
Executive ceases to be an employee, or (3) upon termination of the
Executive's employment for Cause by action of his employer or by
the Executive at such time as the Company shall have grounds to
terminate the Executive's employment for Cause.

	SECTION III

	SEVERANCE BENEFITS

	(a)	Notice of Termination. Any termination by the Company
for cause or as a result of Disability or by the Executive for
Good Reason, shall be communicated by Notice of Termination to the
other party hereto given in accordance with Paragraph A of Section
V of this Agreement.

	(b)	Good Reason; Termination Without Cause. If the Company
shall terminate the Executive's employment other than for Cause or
Disability, or the Executive shall terminate employment for Good
Reason, for three months after the Executive's Date of
Termination:

		(i) the Company shall pay to the Executive in equal bi-
weekly installments in accordance with the Company's regular
payroll practices, in cash, an amount in the aggregate equal
to three times the highest monthly base salary paid or
payable (including any base salary which has been earned but
deferred) to the Executive by the Company or its Affiliates
in respect of the twelve-month period immediately preceding
the month in which the Date of Termination occurs; and

		(ii)	subject to deduction from the payments under
clause (i) immediately preceding of the regular premiums
therefor, the Company shall continue benefits to the
Executive and/or the Executive's family at least equal to
those which would have been provided to them under the
Welfare Benefit Plans if the Executive's employment had not
been terminated or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other
peer executives of the Company and its Affiliates and their
families;

provided, however, that, in the event Executive commences other
full-time employment during such three-month period (including
self-employment), the payments under clause (i) and the coverage
under clause (ii) immediately preceding shall forthwith cease; and
provided, further, that, in the event the Date of Termination
occurs following a Change of Control, or a Change of Control
occurs during the foregoing three-month period, all payments
remaining under clause (i) immediately preceding shall be paid to
the Executive within 30 days of the effective date of such Change
of Control (and the Executive shall be obligated to pay the
regular premiums for continued coverage under clause (i)
immediately preceding at such times or the Company shall
reasonably specify, but not more frequently than bi-weekly). If
the Executive's employment with the Company is terminated prior to
the date on which a Change of Control occurs, but it is reasonably
demonstrated by the Executive that such termination of employment
(x) was at the request of a third party who has taken steps
reasonably calculated to effect a Change of Control or (y)
otherwise arose in connection with or anticipation of a Change of
Control, then for purposes of this Agreement a Change of Control
shall be deemed to have occurred immediately prior to the date of
such termination of employment.

	(c)	Other Termination. If the Executive's employment is
terminated (x) other than by the Company without Cause or (y)
other than by reason of the Executive's Disability, or (z) other
than by the Employee for Good Reason, this Agreement shall
terminate without further obligations to the Executive or the
Executive's legal representatives under this Agreement, other than
for payment of compensation earned through termination, and, in
the case of death or Disability, for such benefits as may be
provided under the Welfare Plans in accordance with their terms.

	SECTION IV

	IMPROVEMENTS; NON-COMPETITION; CONFIDENTIALITY

	(a)	Improvements. The Executive shall devote full time
(unless otherwise agreed to by the Company) and best efforts to
the performance of all responsibilities to the Company and its
Affiliates and to further the businesses and interests of the
Company and its Affiliates. The Executive agrees that all
Inventions shall belong to the Company or its Affiliates. The
Executive shall further: (i) promptly disclose such Inventions to
the Company; (ii) assign to the Company, without additional
compensation, all patent and other rights to such Inventions,
whether patentable or unpatentable, including all substitute,
continuation-in-part and reissue applications, patents of addition
and confirmation relative thereto, for the United States of
America and foreign countries; (iii) sign all papers necessary to
carry out the foregoing; and, (iv) give testimony in support of
inventorship. Furthermore, if any Invention is described in a
patent application or is disclosed to third parties, directly or
indirectly, by the Executive within one year after the termination
of employment, it is to be presumed that the Invention was
conceived or made during the period of the Executive's employment
with the Company or its Affiliates. The Executive agrees not to
assert any rights to any Invention as having been made or acquired
prior to the date of this Agreement, except for Inventions, if
any, disclosed to the Company in writing prior to the date of this
Agreement.

	(b)	Non-Competition. The Executive agrees that during the
term of his employment with the Company or its Affiliates and for
a one-year period following the termination of his employment,
without the prior written consent of the Company, the Executive
may not directly or indirectly, engage, assist or participate in,
whether as a director, officer, employee, agent, manager,
consultant, partner, owner or independent contractor or other
participant, any business, firm, corporation, partnership,
enterprise or organization that conducts a business which involves
any of (i) the development, manufacturing, marketing or servicing
of systems sold to the retailing industry for purposes of
displaying and changing retail point of purchase prices and/or
displaying other information targeted at the consumer or store
employee via electronic and non-electronic means, (ii) the
development, engineering, manufacturing, marketing or servicing or
systems sold to the retailing industry for purposes of improving
pricing accuracy, product location accuracy, inventory management
and item movement, or (iii) the development, engineering,
manufacturing, marketing or servicing or customer-operated
electronic checkout lane systems sold to the retailing industry,
in each case under clauses (i), (ii) or (iii) which is within any
geographic area where the Company or any of its Affiliates (or any
other entity managed by the Company) engages in business;
provided, however, that the Executive may invest in stocks, bonds
or other securities of any similar business (but without otherwise
participating in such similar business) if (i)  such stocks,
bonds, or other securities are listed on any national securities
exchange or are registered under Section 12(g) of the Securities
Exchange Act of 1934, and (ii) his investment does not exceed, in
the case of any class of the capital stock of any one issuer, 5%
of the issued and outstanding shares, or in the case of bonds or
other securities, 5% of the aggregate principal amount thereof
issued and outstanding.

	(c)	Non-Solicitation. The Executive agrees that during the
term of his employment with the Company or any of its Affiliates,
and for a one-year period following termination of his employment,
without the prior written consent of the Company, the Executive
may not interfere with the relationship of the Company or any
Affiliate with, or endeavor to entice away from the Company or any
Affiliate, any person, firm, corporation, or other business
organization who or which at any time after the date hereof was an
employee or supplier of, or maintained a business relationship
with, the Company or any Affiliate.

	(d)	Confidentiality. The Executive shall hold in a
fiduciary capacity for the benefit of the Company all secret or
confidential information, knowledge or data relating to the
Company or any of its Affiliates, and their respective businesses
which shall have been obtained by the Executive during his
employment with the Company or any of its Affiliates during the
term of his employment and which shall not have been publicly
disclosed. During the term of employment and for one year
following termination of employment, the Executive shall not,
without the prior written consent of the Company, communicate or
divulge any such information, knowledge or data to anyone other
than the Company and those designated by it.

	(e)	Relief.  In view of the irreparable harm and damage
which would be incurred by the Company or any Affiliates in the
event of any violation by the Executive of any of the provisions
of this Section IV, the Executive hereby consents and agrees that,
if he violates any such provisions, the Company or any Affiliate
shall be entitled to an injunction or similar equitable relief to
be issued by any court of competent jurisdiction restraining the
undersigned from committing or continuing any such violation.

	SECTION V

	MISCELLANEOUS

	(a)	Notices.  All notices and other communications
hereunder shall be in writing and shall be given by hand delivery
to the other party or by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:

			If to the Executive:

			8 Billwood Drive
			Monroe, New York 10950

			If to the Company:

			488 Main Avenue
			Norwalk, Connecticut 06851-1007
			Attention: Chief Executive Officer

			With a copy to:

			Krugman & Kailes LLP
			Park 80 West - Plaza Two
			Saddle Brook, New Jersey  07663
			Attention: Howard Kailes, Esq.


or to such other address as either party shall have furnished to
the other in writing in accordance herewith. Notice and
communications shall be effective when actually received by the
addressee.

	(b)	Entire Agreement. This Agreement shall contain the
entire agreement of the parties with respect to the transactions
contemplated hereby.

	(c)	Successors. (i) This Agreement is personal to the
Executive and without the prior written consent of the Company
shall not be assignable by the Executive otherwise than by will or
the laws of descent and distribution. This Agreement shall inure
to the benefit of and be enforceable by the Executive's legal
representatives.

		(ii)	 This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns.

		(iii) The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or other-
wise) to all or substantially all of the business and/or assets of
the Company to assume expressly and agree to perform this
Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had
taken place. As used in this Agreement, "Company" shall mean the
Company as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform
this Agreement by operation of law, or otherwise.

	(d)	Non-Exclusivity of Rights. Nothing in this Agreement
shall prevent or limit the Executive's continuing or future
participation in any plan, program, policy or practice provided by
the Company or any of its Affiliates and for which the Executive
may qualify, nor shall anything herein limit or otherwise affect
such rights as the Executive may have under any contract or
agreement with the Company or any of its Affiliates, except that
any and all severance arrangements extended by the Company to the
Executive and otherwise applicable in the circumstances covered by
this Agreement shall no longer operate and shall be superseded by
the provisions hereof.

	(e)	Governing Law; Captions; Amendments. This Agreement
shall be governed by and construed in accordance with the laws of
the State of Delaware, without reference to principles of conflict
of laws. This Agreement may not be amended or modified otherwise
than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.

	(f)	Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement.

	(g)	Withholding. The Company may withhold from any amounts
payable under this Agreement such federal, state, local or foreign
taxes as shall be required to be withheld pursuant to any
applicable law or regulation.

	(h)	No Waiver. The Executive's or the Company's failure to
insist upon strict compliance with any provision of this Agreement
the failure to assert any right the Executive or the Company may
have hereunder, shall not be deemed to be a waiver of such
provision or right or any other provision or right of this
Agreement.

	(i)	Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all
of which taken together shall constitute one and the same
instrument.

	IN WITNESS WHEREOF, the Executive has hereunto set the
Executive's hand and, pursuant to the authorization from its Board
of Directors, the Company has caused these presents to be executed
in its name on its behalf, all as of the day and year first above
written.

						Executive:


						s/Jerry McAuliffe
						------------------------------
						  Jerry McAuliffe


						ELECTRONIC RETAILING
						 SYSTEMS INTERNATIONAL, INC.


						By s/Michael Persky
                                ----------------------------