Document:

BioElectronics Corporation - Exhibit 10.1 - Prepared By TNT Filings Inc.

 

Exhibit 10.1 

EMPLOYMENT AGREEMENT 

This Employment Agreement ("Agreement") dated June 2, 2005
between BioElectronics Corporation, a Maryland Corporation (the "Company")
located at 3612 Sprigg Street South, Frederick, Maryland 21704 and Joseph M.
Iglesias (the "Executive"), residing at 1930 Brushoak Ct., Thousand Oaks CA
91320. 

WITNESSETH: 

WHEREAS. The Board of Directors (the "Board") of the Company
wishes to employ the Executive as Vice President, Design and Engineering of the
Company on the terms and subject to the conditions set forth herein; and 

WHEREAS, the Executive wishes to accept employment with the
Company in the position of Vice President, Design and Engineering on the terms
and subject to the conditions set forth herein. 

NOW, THEREFORE, in consideration of the premises and the
mutual covenants and obligations hereinafter set forth, the parties agree as
follows: 

1) 
EMPLOYMENT 

The Executive’s employment under the terms of this Agreement
shall commence June 1, 2005 (the "Effective Date"), and shall continue until May
31, 2008 unless terminated earlier pursuant to Section 5. (Such period of
employment under this Agreement is hereinafter referred to as the "Employment
Term."). The Executive shall provide services to the Company hereunder as Vice
President, Design and Engineering of the Company. The Executive will serve the
Company subject to the general supervision, advice and direction of the
Executive Vice President/COO upon the terms and conditions set forth in this
Agreement. 

2) DUTIES

PERFORMANCE OF DUTIES. During the
period of the Executive’s employment with the Company, the Executive shall:

  a) Provide overall engineering design management and product
  development leadership to Company’s manufacturing activities, including, but
  not limited to, developing new product designs, coordination fall supplier and
  procurement, product prototyping, testing, production, future project
  research, and IP management. Executive shall also perform such further duties
  as are incidental or implied from its obligation to provide overall
  operational management and leadership to the Company. 

  b) In all respects use his best efforts to further, enhance,
  and develop the Company’s business, affairs, interests and welfare; and 
  

  c) Not become directly or indirectly associated with or
  engaged in any business which competes with the Company or accept any
  employment or other engagement whatsoever from any other person, firm,
  corporation, or entity or do anything inconsistent with its duties to the
  Company. 

3) 
COMPENSATION AND BENEFITS 

  a) BASE COMPENSATION. The Company shall pay the
  Executive a base salary (the "Base Salary"), as compensation for his
  employment under this Agreement, in the amount of $115,000 a year thereafter
  within the Employment Term, the Base Salary shall be as determined by the
  President and the Board of Directors but shall not be less than $115,000.
  During the Employment Term such Base Salary shall be paid in equal
  installments on at least a monthly basis, or on such other basis as is
  applicable to Executives of the Company. 

  b) ANNUAL BONUS. For each calendar year ending during
  the Employment Term for which the Executive remains an employee of the
  Company, the Executive’s bonus compensation ("Annual Bonus") shall be up to
  50% of base compensation for the year to be calculated as follows: 

  
    (1) Company Sales Bonus: Executive shall be eligible to
    receive up to 30% of base salary based on overall company sales. The 2005
    calendar year bonus will be predicated and calculated on annual sales as
    follows: 

    
      (i) Sales under $1.5 million 0.0% 

      (ii) Sales over $1.5 million 1.0% of
      total sales. 

      (iii) Sales over $2.0 million 1.5% of
      total sales. (iv) Sales over $3.0 million 2.5% of total sales. 

    

    (2) Individual Performance Bonus: Executive shall be
    eligible to receive up to 20% of base salary based on delivery of new
    products and performance of new products as directed by the Executive Vice
    President/COO. 

  

The annual bonus formula after the first year will be
established annually by the Compensation Committee of the Board of Directors.
The Executive’s Annual Bonus earned with respect to each year shall be paid on
or before March 31st of the succeeding year. 

  c) STOCK OPTIONS. On the
  Effective Date of this Agreement, (the "Grant Date"), the Company shall in
  consideration of the Covenants in paragraph 5 grant to the Executive an option
  (the "Option") to purchase 900 thousand (900,000) shares of common stock of
  the Company, $.01 par value per share (the "Stock"). The Option shall be
  granted subject to the following terms: (i) the exercise price with respect to
  the initial 300,000 shares under the Option shall be $.30 per share (ii) an
  additional 300,000 shares at a grant price of $.40 per share; (iii) an
  additional 300,000 shares 

- 2 - 

  at a grant price of $.50 per share; (iv) the Option and
  Grant shall fully vest over a three-year period based on continuous employment
  of the Executive and the Options are exercisable as follows: 33.3% shall be
  exercisable on each of the first year, second year and third year
  anniversaries of the Grant Date; and v) the Option shall be exercisable by
  Executive or his estate for a period of five years. The Executive shall
  immediately become 100% vested in, and eligible to exercise, the Option, in
  the event of (a) his termination without Cause (as defined in Section 4, (b) a
  dissolution or liquidation of the Company, (c) a sale of all or substantially
  all of the Company’s assets, (d) a merger or consolidation involving the
  Company in which the Company is not the surviving corporation, (e) a merger or
  consolidation involving the Company in which the Company is the surviving
  corporation but the holders of shares of common stock receive securities of
  another corporation and/or other property, including cash, or (f) a tender
  offer for at least a majority of the outstanding stock of the Company. If
  immediate vesting occurs because of a termination without Cause, the Option
  shall be exercisable for thirty-six (36) months following the effective date
  of such termination; in all other events the option will remain exercisable
  under the terms of the grant. In the event of a termination of employment for
  reasons described in Section 4) Termination below the Executive or his estate
  will forfeit unvested options. 

  d) BENEFITS. During the Employment Term, the
  Executive shall be entitled to participate in all pension, profit sharing and
  other retirement plans, incentive compensation plans and all group health,
  hospitalization and disability insurance plans and other Executive welfare
  benefit plans in which other senior executives of the Company may participate
  on terms and conditions no less favorable than those which apply to such other
  senior executives of the Company. The Executive shall be entitled to three
  weeks annual paid vacations; and to be reimbursed for any reasonable
  out-of-pocket expenses incurred by the Executive in connection with the
  performance of his duties, upon presentation of reasonable evidence
  satisfactory to the Company of the amounts and nature of such expenses. 
  

4) 
TERMINATION 

EVENTS OF TERMINATION. The
Employment Term shall terminate upon the first to occur of the following events:

  a) The close of business on May 31, 2008, unless mutually
  extended in writing by the parties; 

  b) The death of the Executive; 

- 3 - 

  c) The close of business on the 180th day
  following the date on which the Company gives the Executive written notice of
  the termination of his employment as a result of his Permanent Disability.
  Permanent Disability shall mean the Executive’s inability to perform the
  material duties contemplated by this Agreement by reason of a physical or
  mental disability or infirmity which has continued for more than 30
  consecutive days. The Executive agrees to submit such medical evidence
  regarding such disability or infirmity as is reasonably requested by the
  Company, including, but not limited to, an examination by a physician selected
  by the Company in its sole discretion; 

  d) The close of business on the date on which the Company
  gives the Executive written notice of the Company’s termination of his
  employment for Cause, Cause shall mean (A) the Executive’s neglect f his
  material duties, (B) an act or acts by the Executive, or any omission by him,
  constituting a felony, and the Executive has entered a guilty plea or
  confession to, or has been convicted of, such felony, (C) the Executive’s
  failure to follow any lawful directive of the President consistent with the
  Executive’s position and duties, (D) an act or acts of fraud or dishonesty by
  the Executive which results or is intended to result in financial or economic
  harm to the Company, or (E) breach of a material provision of this Agreement
  by the Executive; and 

  e) The close of business on the effective date of a
  Voluntary Termination by the Executive of his employment with the Company.
  Voluntary Termination shall mean any voluntary termination by the Executive of
  his employment with the Company provided that the Executive shall give the
  Company at least 30 days’ prior written notice of the effective date of such
  termination. Such Voluntary Termination shall cease acceleration of bonus and
  options as defined in Section 3. 

5) 
PROTECTED INFORMATION; PROHIBITED SOLICITATION AND COMPETITION 

  a) The Executive hereby recognizes and acknowledges that
  during the course of his employment by the Company, the Company will furnish,
  disclose or make available to the Executive confidential or proprietary
  information related to the Company’s business, including, without limitation,
  customer lists, ideas, processes, inventions and devices, that such
  confidential or proprietary information has been developed and will be
  developed through the Company’s expenditure of substantial time and money, and
  that all such confidential information could be used by the Executive and
  others to compete with the Company. The Executive hereby agrees that all such
  confidential or proprietary information shall constitute trade secrets, and
  further agrees to use such confidential or proprietary information only for
  the purpose of carrying out his duties with the Company and not otherwise to
  disclose such information unless otherwise required to do so by 

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  subpoena or other legal process. The Executive agrees that
  all inventions and discoveries shall be the sole property of the Company, and
  the Company shall be the sole owner of all patents. 

  b) The Executive hereby agrees, in consideration of his
  employment hereunder and in view of the confidential position to be held by
  the Executive hereunder, that during the Employment Term and for the period
  ending on the date which is one year after the later of the termination of the
  Employment Term and the Executive shall not, without the written consent of
  the Company, knowingly solicit, entice or persuade any other employee of the
  Company or any affiliate of the Company to leave the services of the Company
  or such affiliate for any reason. 

  c) The Executive further agrees that, he shall not during
  the Employment Term and for the period ending on the date which one year after
  enter into any relationship whatsoever, either directly or indirectly, alone
  or in partnership, or as an officer, director, employee or stockholder
  (beneficially owning stock or options to acquire stock totaling more than five
  percent of the outstanding shares) of any corporation (other than the
  Company),or otherwise acquire or agree to acquire a significant present or
  future equity or other proprietorship interest, whether as a stockholder,
  partner, proprietor or otherwise, with any enterprise, business or division
  thereof (other than the Company), which is engaged in the development,
  manufacture or marketing and sales of electromagnetic or electro stimulation
  medical devices. 

  d) The restrictions in this Section 5 shall survive the
  termination of this Agreement and shall be in addition to any restrictions
  imposed upon the Executive by statute or at common law. The parties hereby
  acknowledge that the restriction in this Section 5 have been specifically
  negotiated and agreed to by the parties to protect the Company from unfair
  competition. 

6) 
INJUNCTIVE RELIEF 

The Executive hereby expressly acknowledges that any breach or
threatened breach by the Executive of any of the terms set forth in Section 5 of
this Agreement may result in significant and continuing injury to the Company,
the monetary value of which would be impossible to establish. Therefore, the
Executive agrees that the Company shall be entitled to apply for injunctive
relief in court of appropriate jurisdiction. The provisions of this Section
shall survive the Employment Term. 

7) PARTIES
BENEFITED; ASSIGNMENTS 

This Agreement shall be binding upon the Executive, his heirs
and his personal representative or representatives, and upon the Company and its
successors and assigns. Neither this Agreement nor any rights or obligations
hereunder may be assigned by the Executive, other than by will or by the laws of
descent and distribution. 

- 5 - 

8) NOTICES

Any notice required or permitted by this Agreement shall be in
writing, sent by registered or certified mail, return receipt requested,
addressed to the President and the Company at its then principal office, or to
the Executive at the address set forth in the preamble, as the case may be, or
to such other address or addresses as any party hereto may from time to time
specify in writing for the purpose in a notice given to the other parties in
compliance with this Section. Notices shall be deemed given when received.

9) 
GOVERNING LAW 

This Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of Maryland, without regard to conflict
of law principles. 

10) DISPUTES 

Any dispute or controversy arising under, out of, in
connection with or in relation to this Agreement shall, at the election and upon
written demand of either the Executive or the Company, be finally determined and
settled by arbitration in Frederick, Maryland in accordance with the rules and
procedures of the American Arbitration Association, and judgment upon the award
may be entered in any court having jurisdiction thereof. 

11) MISCELLANEOUS 

This Agreement contains the entire agreement of the parties
relating to the subject matter hereof. This Agreement supersedes any prior
written or oral agreements or understandings between the parties relating to the
subject matter hereof. No modification or amendment of this Agreement shall be
valid unless in writing and signed by or on behalf of the parties hereto. A
waiver of the breach of any term or condition of this Agreement shall not be
deemed to constitute a waiver of any subsequent breach of the same or any other
term or condition. This Agreement is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be held in valid or unenforceable, such invalidity and unenforceability shall
not affect the remaining provisions hereof and the application of such
provisions to other persons or circumstances, all of which shall be enforced to
the greatest extent permitted by law. The compensation provided to the Executive
pursuant to this Agreement shall be subject to any withholdings and deductions
required by any applicable tax laws. Any amounts payable under this Agreement to
the Executive after the death of the Executive shall be paid to the Executive’s
estate or legal representative. The headings in this Agreement are inserted for
convenience of reference only and shall not be a part of or control or affect
the meaning of any provision hereof. 

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IN WITNESS WHEREOF, the parties have duly executed and
delivered this Agreement as of the date first written above. 

BioElectronics Corporation: 

/s/ Thomas J. O’Connor 

By: Thomas J. O’Connor 

Executive Vice President/COO 

Executive 

/s/ Joseph M. Iglesias 

By: Joseph M. Iglesias 

- 7 -BioElectronics Corporation - Exhibit 10.2 - Prepared By TNT Filings Inc.

 

Exhibit 10.2 

EMPLOYMENT AGREEMENT 

This Employment Agreement ("Agreement") January 3, 2005
between BioElectronics Corporation, a Maryland Corporation (the "Company")
located at 3612 Sprigg Street South, Frederick, Maryland 21704 and Todd J.
Kislak (the "Executive"), residing at 5809 Middle Crest Drive, Agoura Hills, CA
91301. 

WITNESSETH: 

WHEREAS. The Board of Directors (the "Board")
of the Company wishes to employ the Executive as President, Orthopedics Group of
the Company on the terms and subject to the conditions set forth herein; and

WHEREAS, the Executive wishes to accept employment with the
Company in the position of President, Orthopedics Group on the terms and subject
to the conditions set forth herein. 

NOW, THEREFORE, in consideration of the premises and the
mutual covenants and obligations hereinafter set forth, the parties agree as
follows: 

1) 
EMPLOYMENT 

The Executive’s employment under the terms of this Agreement
shall commence January 3, 2005 (the "Effective Date"), and shall continue until
December 31,2007 unless terminated earlier pursuant to Section 5. (Such period
of employment under this Agreement is hereinafter referred to as the "Employment
Term.") The Executive shall provide services to the Company hereunder as
President, Orthopedic Group of the Company. The Executive will serve the Company
subject to the general supervision, advice and direction of the Chief Executive
Officer upon the terms and conditions set forth in this Agreement. 

2) DUTIES

PERFORMANCE OF DUTIES. During the
period of the Executive’s employment with the Company, the Executive shall:

  a) Supply strategic planning and overall profit/loss
  management for the Company’s Orthopedic Group, 

  b) Provide overall sales, marketing and product development
  leadership and management to Company’s domestic and international activities
  of the Orthopedic Group including, but not limited to, developing sales and
  education programs, contractual sales and distribution arrangements with
  medical supply distributors and resellers, implementation and management of
  medical conference and trade show presentations, market assessments and
  product development and managing product advertising for the Orthopedic Group.
  Executive shall also perform such further duties as are incidental or implied
  from its obligation to provide overall operational 

  management and leadership to the Company. Assignment of
  duties including additions and modifications shall be at the discretion of
  Company President and CEO. 

  c) In all respects use his best efforts to further, enhance,
  and develop the Company’s business, affairs, interests and welfare; and 
  

  d) Not become directly or indirectly associated with or
  engaged in any business which competes with the Company or accept any
  employment or other engagement whatsoever from any other person, firm,
  corporation, or entity or do anything inconsistent with its duties to the
  Company. 

3) 
COMPENSATION AND BENEFITS 

  a) BASE COMPENSATION. The Company shall pay the
  Executive a base salary (the "Base Salary"), as compensation for his
  employment under this Agreement, in the amount of $150,000 a year thereafter
  within the Employment Term, the Base Salary shall be as determined by the
  President and the Board of Directors but shall not be less than $150,000.
  During the Employment Term such Base Salary shall be paid in equal
  installments on at least a monthly basis, or on such other basis as is
  applicable to Executives of the Company. 

  b) ANNUAL BONUS. For each calendar year ending during
  the Employment Term for which the Executive remains an employee of the
  Company, the Executive’s bonus compensation ("Annual Bonus") shall be up to
  50% of base compensation for the year. The 2005 calendar year bonus will be
  predicated and calculated on annual net sales as follows: 

  
    (i) Sales under $1.5 million 0.0% 

    (ii) Sales over $1.5 million 1.0% of total
    sales. 

    (iii) Sales over $2.0 million 1.5% of
    total sales. 

    (iv) Sales over $3.0 million 2.5% of total
    sales. 

  

  The annual bonus formula after the first year will be
  established annually by the Compensation Committee of the Board of Directors
  and may be amended to reflect sales and overall profitability of the
  Orthopedic division. The Executive’s Annual Bonus earned with respect to each
  year shall be paid on or before March 31st of the succeeding year.
  

  
  c) STOCK OPTIONS. On the
  Effective Date of this Agreement, (the "Grant Date"), the Company shall in
  consideration of the Covenants in paragraph 5 grant to the Executive a Grant
  of 500,000 thousand shares of restricted common stock of the Company and an
  option (the "Option") to purchase 2.1 million shares of common stock of the
  Company, $.01 par value per share (the "Stock"). The Option shall be granted
  subject to the following terms: (i) the exercise price with respect to the
  initial 700,000 shares under the Option shall be $.30 per share (ii) an
  additional 700,000 

- 2 - 

  shares at a grant price of $.40 per share; (iii) an
  additional 700,000 shares at a grant price of $.50 per share; (iv) the Option
  and Grant shall fully vest over a three-year period based on continuous
  employment of the Executive and the Options are exercisable as follows: 33.3%
  shall be exercisable on each of the first year, second year and third year
  anniversaries of the Grant Date; and v) the Option shall be exercisable by
  Executive or his estate for a period of five years. The Executive shall
  immediately become 100% vested in, and eligible to exercise, the Option, in
  the event of (a) his termination without Cause (as defined in Section 4, (b) a
  dissolution or liquidation of the Company, (c) a sale of all or substantially
  all of the Company’s assets, (d) a merger or consolidation involving the
  Company in which the Company is not the surviving corporation, (e) a merger or
  consolidation involving the Company in which the Company is the surviving
  corporation but the holders of shares of common stock receive securities of
  another corporation and/or other property, including cash, or (f) a tender
  offer for at least a majority of the outstanding stock of the Company. If
  immediate vesting occurs because of a termination without Cause, the Option
  shall be exercisable for thirty-six (36) months following the effective date
  of such termination; in all other events the option will remain exercisable
  under the terms of the grant. In the event of a termination of employment for
  reasons described in Section 4) Termination below the Executive or his estate
  will forfeit unvested options. 

  d) BENEFITS. During the Employment Term, the
  Executive shall be entitled to participate in all pension, profit sharing and
  other retirement plans, incentive compensation plans and all group health,
  hospitalization and disability insurance plans and other Executive welfare
  benefit plans in which other senior executives of the Company may participate
  on terms and conditions no less favorable than those which apply to such other
  senior executives of the Company as determined by the Company Compensation
  committee. The Executive shall be entitled to three weeks annual paid
  vacations; and to be reimbursed for any reasonable out-of-pocket expenses
  incurred by the Executive in connection with the performance of his duties,
  upon presentation of reasonable evidence satisfactory to the Company of the
  amounts and nature of such expenses. 

4) 
TERMINATION 

EVENTS OF TERMINATION. The
Employment Term shall terminate upon the first to occur of the following events:

  a) The close of business on December 31, 2007, unless
  mutually extended in writing by the parties; 

  b) The death of the Executive; 

- 3 - 

  c) The close of business on the 180th day
  following the date on which the Company gives the Executive written notice of
  the termination of his employment as a result of his Permanent Disability.
  Permanent Disability shall mean the Executive’s inability to perform the
  material duties contemplated by this Agreement by reason of a physical or
  mental disability or infirmity which has continued for more than 30
  consecutive days. The Executive agrees to submit such medical evidence
  regarding such disability or infirmity as is reasonably requested by the
  Company, including, but not limited to, an examination by a physician selected
  by the Company in its sole discretion; 

  d) The close of business on the date on which the Company
  gives the Executive written notice of the Company’s termination of his
  employment for Cause. Cause shall mean (A) the Executive’s neglect f his
  material duties, (B) an act or acts by the Executive, or any omission by him,
  constituting a felony, and the Executive has entered a guilty plea or
  confession to, or has been convicted of, such felony, (C) the Executive’s
  failure to follow any lawful directive of the President consistent with the
  Executive’s position and duties, (D) an act or acts of fraud or dishonesty by
  the Executive which results or is intended to result in financial or economic
  harm to the Company, or (E) breach of a material provision of this Agreement
  by the Executive; and 

  e) The close of business on the effective date of a
  Voluntary Termination by the Executive of his employment with the Company.
  Voluntary Termination shall mean any voluntary termination by the Executive of
  his employment with the Company provided that the Executive shall give the
  Company at least 30 days’ prior written notice of the effective date of such
  termination. Such Voluntary Termination shall cease acceleration of bonus and
  options as defined in Section 3. 

5) 
PROTECTED INFORMATION; PROHIBITED SOLICITATION AND COMPETITION 

  a) The Executive hereby recognizes and acknowledges that
  during the course of his employment by the Company, the Company will furnish,
  disclose or make available to the Executive confidential or proprietary
  information related to the Company’s business, including, without limitation,
  customer lists, ideas, processes, inventions and devices, that such
  confidential or proprietary information has been developed and will be
  developed through the Company’s expenditure of substantial time and money, and
  that all such confidential information could be used by the Executive and
  others to compete with the Company. The Executive hereby agrees that all such
  confidential or proprietary information shall constitute trade secrets, and
  further agrees to use such confidential or proprietary information only for
  the purpose of carrying out his duties with the Company and not otherwise to
  disclose such information unless otherwise required to do so by 

- 4 - 

  subpoena or other legal process. The Executive agrees that
  all inventions and discoveries shall be the sole property of the Company, and
  the Company shall be the sole owner of all patents. 

  b) The Executive hereby agrees, in consideration of his
  employment hereunder and in view of the confidential position to be held by
  the Executive hereunder, that during the Employment Term and for the period
  ending on the date which is one year after the later of the termination of the
  Employment Term and the Executive shall not, without the written consent of
  the Company, knowingly solicit, entice or persuade any other employee of the
  Company or any affiliate of the Company to leave the services of the Company
  or such affiliate for any reason. 

  c) The Executive further agrees that, he shall not during
  the Employment Term and for the period ending on the date which one year after
  enter into any relationship whatsoever, either directly or indirectly, alone
  or in partnership, or as an officer, director, employee or stockholder
  (beneficially owning stock or options to acquire stock totaling more than five
  percent of the outstanding shares) of any corporation (other than the
  Company), or otherwise acquire or agree to acquire a significant present or
  future equity or other proprietorship interest, whether as a stockholder,
  partner, proprietor or otherwise, with any enterprise, business or division
  thereof (other than the Company), which is engaged in the development,
  manufacture or marketing and sales of electromagnetic or electro stimulation
  medical devices. 

  d) The restrictions in this Section 5 shall survive the
  termination of this Agreement and shall be in addition to any restrictions
  imposed upon the Executive by statute or at common law. The parties hereby
  acknowledge that the restriction in this Section 5 have been specifically
  negotiated and agreed to by the parties to protect the Company from unfair
  competition. 

6) 
INJUNCTIVE RELIEF 

The Executive hereby expressly acknowledges that any breach or
threatened breach by the Executive of any of the terms set forth in Section 5 of
this Agreement may result in significant and continuing injury to the Company,
the monetary value of which would be impossible to establish. Therefore, the
Executive agrees that the Company shall be entitled to apply for injunctive
relief in court of appropriate jurisdiction. The provisions of this Section
shall survive the Employment Term. 

7) PARTIES
BENEFITED; ASSIGNMENTS 

This Agreement shall be binding upon the Executive, his heirs
and his personal representative or representatives, and upon the Company and its
successors and assigns. Neither this Agreement nor any rights or obligations
hereunder may be assigned by the Executive, other than by will or by the laws of
descent and distribution. 

- 5 - 

8) NOTICES

Any notice required or permitted by this Agreement shall be in
writing, sent by registered or certified mail, return receipt requested,
addressed to the President and the Company at its then principal office, or to
the Executive at the address set forth in the preamble, as the case may be, or
to such other address or addresses as any party hereto may from time to time
specify in writing for the purpose in a notice given to the other parties in
compliance with this Section. Notices shall be deemed given when received.

9) 
GOVERNING LAW 

This Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of Maryland, without regard to conflict
of law principles. 

10) DISPUTES 

Any dispute or controversy arising under, out of, in
connection with or in relation to this Agreement shall, at the election and upon
written demand of either the Executive or the Company, be finally determined and
settled by arbitration in Frederick, Maryland in accordance with the rules and
procedures of the American Arbitration Association, and judgment upon the award
may be entered in any court having jurisdiction thereof. 

11) MISCELLANEOUS 

This Agreement contains the entire agreement of the parties
relating to the subject matter hereof. This Agreement supersedes any prior
written or oral agreements or understandings between the parties relating to the
subject matter hereof. No modification or amendment of this Agreement shall be
valid unless in writing and signed by or on behalf of the parties hereto. A
waiver of the breach of any term or condition of this Agreement shall not be
deemed to constitute a waiver of any subsequent breach of the same or any other
term or condition. This Agreement is intended to be performed in accordance
with, and only to the extent permitted by, all applicable laws, ordinances,
rules and regulations. If any provision of this Agreement, or the application
thereof to any person or circumstance, shall, for any reason and to any extent,
be held in valid or unenforceable, such invalidity and unenforceability shall
not affect the remaining provisions hereof and the application of such
provisions to other persons or circumstances, all of which shall be enforced to
the greatest extent permitted by law. The compensation provided to the Executive
pursuant to this Agreement shall be subject to any withholdings and deductions
required by any applicable tax laws. Any amounts payable under this Agreement to
the Executive after the death of the Executive shall be paid to the Executive’s
estate or legal representative. The headings in this Agreement are inserted for
convenience of reference only and shall not be a part of or control or affect
the meaning of any provision hereof. 

- 6 - 

IN WITNESS WHEREOF, the parties have duly executed and
delivered this Agreement as of the date first written above. 

BioElectronics Corporation: 

/s/ Andrew J. Whelan By: Andrew J. Whelan, President 

Executive 

/s/ Todd J. Kislak 

By: Todd J. Kislak 

- 7 -

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