Document:

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                                                                    EXHIBIT 10.5

                             EMPLOYMENT AGREEMENT

     This Employment Agreement (this "Agreement") is entered into as of April
15, 2000, between mPhase Technologies, Inc., a New Jersey corporation, with its
principal place of business presently located at 587 Connecticut Avenue,
Norwalk, Connecticut 06854 (the "Company"), and Martin Smiley having his
principal residence at 12 Sycamore Drive, Wesport, Connecticut 06880 (the
"Executive").

                               W I N E S S E T H
                               -----------------

     WHEREAS, the Company is in the business of designing, assembling, selling
and marketing telecommunications products, and in particular, the development of
its proprietary TRAVERSER Digital Video & Data Delivery Systems to enhance the
bandwidth utilization of conventional twisted pair cooper telephone lines;

     WHEREAS, the Company desires to employ Executive, and the Executive in turn
desires to become a full time Executive of the Company, as its Executive Vice
President, Chief Financial Officer and General Counsel pursuant to the terms of
this Agreement.

     NOW, THEREFORE, in consideration of the mutual covenants, promises and
agreements set forth in this Agreement, the legal sufficiency of which is hereby
acknowledged, and intending to be legally bound, the Company and the Executive
agree as follows:

     1.   Incorporation of "Whereas" Clauses
          ----------------------------------

     The representations, terms and undertakings set forth in the WHEREAS
clauses of this Agreement are incorporated herein by reference as though recited
verbatim and at length.

     2.   Employment
          ----------

     The Company hereby agrees to employ the Executive, and the Executive hereby
agrees to be employed by the Company, subject to the terms and conditions of
this Agreement

     3.   Title, Duties and Services
          --------------------------

          3.1  Title.  The Executive shall be employed by the Company as an
Executive Vice President, and as the Company's General Counsel and Chief
Financial Officer. The portion of the Executive's position entitled "Chief
Financial Officer" shall initially be for a 90 day observation period commencing
upon the date of his employment under this Agreement. The Executive shall
automatically retain the portion of his Title as Chief Financial Officer under
this Agreement absent a resolution from the Company's Board of Directors
removing such portion of the Title at any time.

          3.2  Duties and Services.  During his employment under this Agreement,
the Executive shall have such duties and responsibilities and perform such
services as may be properly assigned to him from time to time by the Company's
Chief Executive Officer ("CEO")
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or the Company's Board of Directors (the "Board of Directors"), and shall report
to the CEO. The Executive shall be responsible for managing all legal matters
effecting the Company. In addition the Executive shall assist the CEO in
strategic planning including the raising of additional capital, as required, for
the Company from institutional sources and the identification and analysis of
potential acquisition opportunity for the Company. The Executive will be
responsible for supervising the timely filing of all required legal reports
under both state and federal securities laws for the Company, as a publicly held
company. In addition, the Executive during his tenure as Chief Financial Officer
of the Company shall oversee the Company's controller and internal and outside
auditors preparation of the Company's financial statements to ensure the
accuracy of such statements consistent with generally accepted accounting
principles.

     4.   Term
          ----

     This Agreement shall be effective for an initial two year period (the
"Employment Term") which shall commence on August 21, 2000 (the "Effective
Date"), and continue through August 20, 2002 unless terminated earlier in
accordance with Section 7 of this Agreement.  It is the intention of the parties
that not less than one month prior to the expiration of the Employment Term, the
Company and the Executive shall agree to negotiate an extension of this
Agreement for one or more 12-month renewal periods.  In the absence of such a
written extension, the Executive shall become an "employee at will" and the
Company shall have the right to terminate the Executive at any time thereafter,
with or without cause.  In the event the Company elects to terminate the
Executive without cause, after the Employment Term, the Company shall pay the
Executive sixty (60) days of his then Base Salary.

     5.   Compensation and Benefits
          -------------------------

          5.1  Base Salary.  During the Executive's employment under this
Agreement, the Executive shall be entitled to receive a base salary at an annual
rate of not less than $175,000, payable in accordance with the Company's payroll
procedures (the "Base Salary"). In consideration of the receipt of this
compensation, the Executive shall provide his full time, energy and skill in the
performance of his employment duties. Commencing in 2001, Executive shall be
eligible for Base Salary increases pursuant to reviews by the Board of
Directors, or a committee appointed by the Board of Directors, at such times as
salary reviews are conducted generally for the Company's executive officers, but
in no event less frequent than annually.

          5.2  Bonus

               5.2.1  In General.  During the Executive's employment under this
Agreement, the Executive shall be eligible to participate in any bonus plans as
may be maintained by the Company from time to time for its executive officers.
The terms of the Executive's participation in such bonus plans shall be
determined by the Board of Directors and the Compensation Committee, or by such
person or administrative body as designated by Board of Directors and
Compensation Committee.

                                      -2-
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               5.2.2  Eligibility for First Bonus.  The Executive shall receive
a performance review from the CEO covering the period from the Effective Date
through June 30, 2001 not later than July 30, 2001 and shall be eligible for a
cash bonus based upon the performance of the Executive for such period as
determined in the sole discretion of the CEO and the Board of Directors.

     6.   Incentive Stock Compensation
          ----------------------------

          6.1  In General.  During the Executive's employment under this
Agreement, the Executive shall be eligible to participate in any stock incentive
plans as may be maintained by the Company from time to time for executive
officers. The Executive's awards under such stock incentive plans shall be
determined by the Board of Directors or such person or administrative body as
provided under such plans.

          6.2  Initial Option Grant.  The Company hereby grants the Executive a
stock option (the "Option") to purchase shares of the common stock of the
Company (the "Stock"), as follows:

               (i)  Number of Shares and Exercise Price.  The Option shall cover
                    -----------------------------------
               125,000 shares of common stock of the Company.

               The per-share exercise price of the Option will be equal to three
               quarters of the fair market value per share on the Effective
               Date.  The fair market value of the stock shall be computed by
               taking the average between the public bid and ask price of the
               stock on the NASDAQ Bulletin Board as of the close of business on
               the Effective Date.

               (ii) Vesting.  The Option shall vest in four equal semi-annual
                    -------
                    installments over a two year period of 31,250 shares each on
                    February 21, 2001, August 21, 2001, February 21, 2002 and
                    August 20, 2002 respectively; provided, however, that each
                    installment shall vest only if the Executive's employment or
                    other service relationship with the Company is continuous
                    from the grant date through the applicable vesting date. If
                    the Executive's employment or other service relationship
                    with the Company is terminated by the Company or its
                    successor without Good Cause coincident with or within one
                    year following a Change in Control (as defined in Section
                    6.3.2(iii), below) then the Option will vest as to the
                    portion that would otherwise vest during the 12 calendar
                    months beginning after such termination. All other terms of
                    the Option will be set forth in further detail in a Stock
                    Option Agreement attached hereto as Schedule I which is
                    consistent with the Company's stock incentive plan, program
                    or policy.

                                      -3-
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                    (iii)  Definition of Change in Control.  For purposes of
                           -------------------------------
                           Section 6.3.2(ii), the term "Change in Control"
                           means: (i) the acquisition (other than from the
                           Company) by any Person, as defined in this Section
                           6.3.2(iii), of the beneficial ownership (within the
                           meaning of Rule 13d-3 promulgated under the
                           Securities Exchange Act of 1934, as amended) of 50%
                           or more of either (A) the then outstanding shares of
                           the securities of the Company, or (B) the combined
                           voting power of the then outstanding securities of
                           Company entitled to vote generally in the election of
                           directors (the "Company Voting Stock"); (ii) the
                           closing of a sale or other conveyance of all or
                           substantially all of the assets of the Company; or
                           (iii) the closing of any merger, share exchange
                           consolidation, or other business combination of the
                           Company if immediately after such transaction persons
                           who hold a majority of the outstanding voting
                           securities entitled to vote generally in the election
                           of directors of the surviving entity (or the entity
                           owning 100% of such surviving entity) are not persons
                           who, immediately prior to such transaction, held the
                           majority of the Company Voting Stock; provided,
                           however, that a Change in Control shall not include a
                           public offering of capital stock of the Company. For
                           purposes of this Section 6.2(iii), a "Person" means
                           any individual, entity or group within the meaning of
                           Section 13(d)(3) or 14(d)(2) of the Securities
                           Exchange Act of 1934, as amended, other than:
                           employee benefit plans sponsored or maintained by the
                           Company and corporations controlled by the Company.

          6.3  Benefits.  During his employment under this Agreement, the
Executive shall be entitled to: (i) participation in such employee retirement
and welfare benefit plans, 401k Plan, programs, policies and arrangements as
maintained by the Company from time to time, in whole or in part, for executive
officers of the Company; and (ii) paid vacation of a minimum of four weeks for
every twelve months worked, holidays, and leave of absence in accordance with
the policies of the Company; and (iii) perquisites as from time to time provided
by the Company to its executive officers.

          6.4  Expenses.  During the Executive's employment under this
Agreement, the Company shall reimburse the Executive for ordinary and reasonable
out-of-pocket expenses incurred by him in the performance of his duties
hereunder, provided that the Executive shall limit, and account to the Company
for, such expenses in accordance with the employee business expense policies and
practices of the Company.

     7.   Termination of Employment
          -------------------------

          7.1  Termination by the Company without Good Cause. The Company may
terminate the Executive's employment under this Agreement without Good Cause at
any time by giving 60 days prior written notice thereof to the Executive. Upon
such termination, the

                                      -4-
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Executive shall be entitled to such compensation as provided in Section 7.1.2.
For purposes of this Agreement, "Good Cause" means any of the following, as
determined by a majority vote of the Board of Directors after notice to the
Executive and an opportunity for the Executive to be heard by the Board of
Directors.

               (i)    The Executive's conviction of, or plea of nolo contendere
                      to, a felony or crime involving moral turpitude;

               (ii)   The Executive's fraud on, or misappropriation of any funds
                      or property of, the Company;

               (iii)  Personal dishonesty, incompetence or gross negligence in
                      the Executive's performance of his duties;

               (iv)   Willful misconduct by the Executive in connection with the
                      performance of his duties, or the Executive's willful
                      failure to perform his duties and responsibilities in the
                      best interests of the Company;

               (v)    The Executive's repeated use of alcohol, drugs or other
                      similar substances that affect his work performance; or

               (vi)   Breach by the Executive of any provision of this Agreement
                      or any provision of non-disclosure, non-competition, non-
                      solicitation or other similar agreement executed by the
                      Executive for the benefit of the Company.

               7.1.2  Severance Pay.  If the Executive's employment under this
Agreement is terminated during the Term of this Agreement by the Company without
Good Cause, the Executive shall be entitled to continued payment of his Base
Salary, at the rate in effect immediately before the date of termination, (i)
for a period of sixty (60) days if such termination occurs during the first 90
days of the Term of this Agreement or (ii) for a period equal to the lesser of
12 months or the remaining Term of this Agreement if such termination occurs
after the first 90 days of the Term of this Agreement, provided that the
Executive (A) honors the restrictive covenants as provided in Section 8 of this
Agreement and (B) executes a release of all claims arising from his employment
by the Company, in such form as may then be used by the Company respecting
termination of employees.

          7.2  Termination by the Company for Good Cause; Death or Disability

               7.2.1  Termination by the Company for Good Cause. The Company may
terminate the Executive's employment under this Agreement for Good Cause by
giving notice thereof to the Executive specifying in reasonable detail the Good
Cause based upon which the Company terminates his employment. Upon such a
termination for Good Cause, the Company shall not owe the Executive any salary
payments beyond the date of termination.

                                      -5-
<PAGE>

               7.2.2  Termination upon Death or Disability.  This Agreement
shall terminate upon the Executive's death. If the Company determines in good
faith that the Executive has a Significant Disability as defined in this
Section, the Company may terminate his employment under this Agreement by
notifying the Executive thereof at least 30 days before the effective date of
termination. For purposes of this Agreement, "Significant Disability" means the
inability of the Executive to substantially perform his duties under this
Agreement by reason of any physical or mental impairment which can be expected
to result in death or which has lasted or can be expected to last for a
continuous period of not less than six months. If there is any dispute between
the parties as to whether the Executive suffers from a significant Disability,
the Company shall select or approve a physician whose determination of that
issue shall bind the parties hereto.

               7.2.3  Effect of Termination by the Company for Good Cause or
Termination upon Death or Significant Disability. If the Executive's employment
under this Agreement is terminated by the Company for Good Cause or due to the
Executive's death or Significant Disability, all obligations of the Company
under this Agreement shall terminate, except as provided in Section 7.4.

          7.3  Termination by the Executive. The Executive may terminate his
employment under this Agreement at any time upon 60 days prior written notice
thereof to the Company. Upon such termination, all obligations of the Company
under this Agreement shall terminate, except as provided in Section 7.4.

          7.4  Payment of Base Salary upon Termination. Upon a termination of
the Executive's employment with the Company for any reason, the Executive shall
be entitled to receive his Base Salary earned but unpaid through the date of
such termination, on or before the day on which the Executive would have been
paid such amount if his employment hereunder had not been terminated.

          7.5  No Duty to Mitigate.  The Executive shall not be obligated to
seek other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement,
and such amounts shall not be reduced whether or not the Executive obtains other
employment.

     8.   Restrictive Covenants
          ---------------------

          8.1  Non Competition.  The Executive shall provide his full time,
skill and attention to the business of the Company during the Employment Term of
this Agreement and shall use his best efforts to further the interests of the
business of the Company at all times. The Executive shall not, unless so
approved in writing by the CEO of the Company, during the Employment Term engage
directly or indirectly, in any business other than that of and on behalf of the
Company. In order to provide reasonable protection for the business of the
Company, the Executive shall not for so long as he is employed directly or
indirectly by the Company have any interest in any other corporation,
partnership or other business entity which directly or indirectly competes with
or is similar, to the business being conducted by the Company. Nothing contained
in this section shall prohibit the Executive from investing in common stocks or
other

                                      -6-
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securities of publicly held corporations so long as his equity ownership
percentage in such companies does not exceed 1% of the common stock outstanding
of any such corporations.

          8.2  Confidential Information.  The Executive shall at all times hold
in a fiduciary capacity for the benefit of the Company all secret, confidential
or proprietary information, knowledge or data relating to the Company, and all
of its businesses, which shall have been obtained by the Executive during his
employment by the Company and which shall not be or become public knowledge
(other than by acts by the Executive or his representatives in violation of this
Agreement), including, but not limited to, information regarding the Company's
processes, products, clients, customers, vendors financial data, marketing
strategies, business plans, pricing information etc. (the "Confidential
Information"). During the Executive's employment with the Company and under this
Agreement and after the termination of such employment, the Executive shall not,
without the prior written consent of the Company, communicate or divulge any
Confidential Information to any Person (as defined in Section 8.6.3) other than
the Company and those designated by it or use any Confidential Information,
except for the benefit of the Company, provided that the Executive may make
disclosures to comply with the law or legal process. Immediately upon
termination of the Executive's employment with the Company at any time and for
any reason, the Executive shall return to the Company all Confidential
Information, including, but not limited to, any and all copies, reproductions,
notes or extracts of all Confidential Information. Furthermore the Executive
agrees to turn over to the Company all inventions, improvements and concepts
developed by him while employed by the Company. Without limiting the foregoing,
the Executive agrees to the following provisions:

               (a)  to disclose, grant and assign to the Company as its
exclusive property, all inventions, improvements and technical or business
innovations and suggestions relating in any way to the business of the Company,
or capable of beneficial use by the Company, developed or conceived by the
Executive solely or jointly with others during the course of his employment or
within twelve (12) months after the termination of his employment, (i) which are
along the lines of the business, work or investigations of the Company or its
affiliates, or (ii) which result from or are suggested by any work which the
Executive may do for the Company;

               (b)  to execute all necessary papers including applications,
assignments, and otherwise provide proper assistance (at the Company's expense),
during and subsequent to employment, to enable the Company to obtain for itself
or its nominees, patents, copyrights, or other legal protection for such
inventions or innovations in any and all countries;

               (c)  to make and maintain for the Company adequate and current
written records of all such inventions or innovations;

               (d)  to take affirmative steps to prevent the disclosure of trade
secrets and other Confidential Information by other Persons, including but not
limited to, potential investors or strategic partners by requesting and
obtaining appropriate confidentiality agreements.

                                      -7-
<PAGE>

          8.3  Solicitation of Employees. During the Employment Term and, if the
Executive's employment under this Agreement is terminated for any reason, for
two years after the date of such termination, the Executive shall not: (i)
solicit, participate in or promote the solicitation of any person who was
employed by the Company, at any time during the three-month period prior to the
Executive's termination of employment under this Agreement, to leave the employ
of the Company; or (ii) on behalf of himself or any other Person, hire, employ
or engage any such person. The Executive further agrees that, during such time,
if an employee of the Company contacts the Executive about prospective
employment, the Executive will inform such employee that he cannot discuss the
matter further without informing the Company.

          8.4  Solicitation of Clients.  During the Employment Term and, if the
Executive's employment under this Agreement is terminated for any reason, for
two years after the date of such termination, the Executive shall not, directly
or indirectly, solicit, entice or induce any Client (as defined in Section 8.6)
of the Company to become a Client of any Person other than the Company, or to
modify, curtail or cease its business with the Company, and the Executive will
not assist any Person in taking any such action.

          8.5  Remedies for Breach.  The Executive agrees that damages in the
event of any breach of Sections 8.1 through 8.4 by the Executive would be
difficult to ascertain. The Executive therefore agrees that, notwithstanding
anything in this Agreement to the contrary, including by not limited to the
provisions of Section 15, the Company, in addition to and without limiting any
other remedy or right it may have, shall have the right to an injunction or
other equitable relief in any court of competent jurisdiction, enjoining any
such breach. The Executive hereby waives any and all defenses he may have on the
ground of lack of jurisdiction or competence of the court to grant such an
injunction or other equitable relief. The existence of this right shall not
preclude any other rights and remedies at law or in equity which the Company may
have.

          8.6  Definitions.  For purposes of Section 8, the following
definitions shall apply:

               8.6.1  "Company."  "Company" means mPhase Technologies, Inc. and
all of its subsidiaries and affiliates.

               8.6.2  "Client."  "Client" means any person, entity (including
but not limited to a corporation, partnership or trust), division, business
unit, department or agency which, at the time of termination of the Executive's
employment hereunder or at any time within two years prior thereto, shall have
purchased goods or services from the Company or shall have contacted the Company
to purchase goods or services in the future.

               8.6.3  "Person."  "Person" means any individual or entity,
including but not limited to any corporation, trust, sole proprietorship, joint
venture or partnership.

          8.7  Survival of Section 8. The Executive agrees that the
nondisclosure, noncompetition, and nonsolicitation agreements in this Section 8
each constitute separate agreements independently supported by good and adequate
consideration and, notwithstanding

                                      -8-
<PAGE>

anything in this Agreement to the contrary, shall be severable from the other
provisions of, and shall survive, this Agreement.

     9.   Notices.   Any notices, requests, demands and other communications
          -------
provided for by this Agreement shall be sufficient if in writing and if sent by
registered or certified mail to the Executive at the last address he has filed
in writing with the Company or, in the case of the Company, to the Company's
principal executive offices. The parties to this Agreement may change the
address to which notices, requests, demands and other communications shall be
sent by sending written notice of such change of address to the other in the
manner set forth in this Section 9.

     10.  Withholding Taxes.  The Company shall have the right, to the extent
          -----------------
permitted or required by law, to withhold monies from any payment of any kind
due to the Executive under this Agreement in order to satisfy the tax
withholding obligations of the Company under applicable law.

     11.  Successors and Assigns.  The rights, duties and obligations of a party
          ----------------------
hereunder may not be assigned, delegated or assumed without the prior written
consent of the other party, provided that the Company may assign this Agreement
to any subsidiary or successor, without the Executive's consent, and such
assignment shall not constitute, a termination of his employment hereunder.
Nothing herein shall cause a termination of this Agreement upon the acquisition,
reorganization, or merger of the Company.  This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors or permitted assigns.  Nothing herein shall be construed to confer
upon any person not a party hereto any right, remedy or claim under or by reason
of this Agreement.

     12.  Entire Agreement  This Agreement constitutes the entire understanding
          ----------------
of the Executive and the Company with respect to the subject matter hereof and
supersedes and voids any and all prior and contemporaneous agreements or
understandings, written or oral, regarding the subject matter hereof.

     13.  Amendment and Waiver.  This Agreement may not be changed, modified, or
          --------------------
discharged orally, but only by an instrument in writing signed by the parties.
No waiver of any term or condition of this Agreement shall be effective unless
agreed to in writing between the parties.

     14.  Governing Law and Severability.  This Agreement shall be governed by
          ------------------------------
the laws of the State of Connecticut (without giving effect to choice of law
principles or rules thereof that would cause the application of the laws of any
jurisdiction other than the State of Connecticut) and the invalidity or
unenforceability of any provisions hereof shall in no way affect the validity or
enforceability of any other provision.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating or affecting the remaining portion of such provision or the
other provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

                                      -9-
<PAGE>

     15.  Arbitration.  All disputes regarding the Executive's employment with
          -----------
the Company or the termination thereof, including, without limitation, all
disputes arising under or related to this Agreement, or the breach or alleged
breach thereof, all claims arising under Title VII of the Civil Rights Act of
1964, the Age Discrimination in Employment Act, the Americans with Disabilities
Act, the Family and Medical Leave Act, all other federal and state employment
discrimination laws, and all claims for wages or other compensation, personal
injury, emotional distress, pain and suffering and any and all other claims or
counterclaims between the Executive and the Company, shall be submitted to, and
solely determined by, final and binding arbitration conducted by and in
accordance with JAMS L.L.C.'s arbitration rules applicable to employment
disputes then in effect, and the parties agree to be bound by the final award of
the arbitrator in any such proceeding. Notwithstanding the foregoing, this
arbitration provision shall not apply to disputes regarding the Executive's
compliance with Section 8 of this Agreement. The arbitrator shall apply the laws
of the State of Connecticut in all such arbitrations. The arbitration shall be
held in Stamford, Connecticut or such other place as the parties may mutually
agree, and shall be conducted only by a single arbitrator who either is agreed
to by the parties or selected in accordance with JAMS L.L.C.'s arbitration
rules. Judgment upon the award by the arbitrator may be entered in any court
having jurisdiction thereof.

     16.  Consultation with Counsel.  The Executive acknowledges that prior to
          -------------------------
executing this Agreement he has had the opportunity to consult and has in fact
consulted with independent counsel of his personal choice.

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

Executive                                         mPhase Technologies, Inc.

_______________________________________           By ___________________________
Martin S. Smiley                                     Ronald A. Durando
                                                     President and CEO

                                      -10-<PAGE>

                                                                    EXHIBIT 10.6

                             EMPLOYMENT AGREEMENT

     This Employment Agreement (the "Agreement") is entered into as of April 1,
2001, between mPhase Technologies, Inc., a New Jersey corporation, with its
principal place of business presently located at 587 Connecticut Avenue,
Norwalk, Connecticut 06854 (the "Company"), and David Klimek having his
principal residence at 5640 Lakeshore Drive, Buford, Georgia (the "Employee").

     WHEREAS, the Company is in the business of designing, assembling, selling
and marketing telecommunications products, and in particular, the development of
its proprietary TRAVERSER Digital Video & Data Delivery Systems to enhance the
bandwidth utilization of conventional twisted pair cooper telephone lines;

     WHEREAS, the Company desires to set forth herein the terms of employment
between the Company and the Employee, is the current Chief Technology Officer of
the Company.

     NOW, THEREFORE, in consideration of the mutual covenants, promises and
agreements set forth in this Agreement, the legal sufficiency of which is hereby
acknowledged, and intending to be legally bound, the Company and the Employee
agree as follows:

     1.   Incorporation of "Whereas" Clauses
          ----------------------------------

     The representations, terms and undertakings set forth in the WHEREAS
clauses of this Agreement are incorporated herein by reference as though recited
verb atim and at length.

     2.   Employment
          ----------

     The Company hereby agrees to employ the Employee, and the Employee hereby
agrees to be employed by the Company, subject to the terms and conditions of
this Agreement

     3.   Title, Duties and Services
          --------------------------

          3.1  Title.  The Employee shall be employed by the Company as its
Chief Technology Officer.

          3.2  Duties and Services.  During his employment under this Agreement,
the Employee shall have such duties and responsibilities and perform such
services as may be properly assigned to him from time to time by the Company's
Chief Executive Officer and shall report to the Chief Executive Officer. The
Employee shall be responsible for engineering and development and deployment of
the Company's Traverser Product in conjunction with Georgia Tech Research
Institute. The Employee may have additional duties assigned to him from time to
time from the Company's Chief Executive Officer.
<PAGE>

     4.   Term
          ----

     This Agreement shall be effective from the date hereof and continue through
April 1, 2002 (the "Employment Term"), unless terminated earlier in accordance
with Section 7 of this Agreement. It is the intention of the parties that not
less than one month prior to the expiration of the Employment Term, the Company
and the Employee shall agree to negotiate an extension of this Agreement for one
or more 12-month renewal periods. In the absence of such a written extension,
the Employee shall become an "employee at will" and the Company shall have the
right to terminate the Employee at any time thereafter, with or without cause.
In the event the Company elects to terminate the Employee without cause, after
the Employment Term, the Company shall pay the Employee sixty (60) days of his
then Base Salary.

     5.   Compensation and Benefits
          -------------------------

          5.1  Base Salary.  During the Employee's employment under this
Agreement, the Employee shall be entitled to receive a base salary at an annual
rate of not less than $170,000, payable in accordance with the Company's payroll
procedures (the "Base Salary") and relocation expense reimbursement. In
consideration of the receipt of this compensation, the Employee shall provide
his full time, energy and skill in the performance of his employment duties.
Employee shall be eligible, from time to time, for Base Salary increases
pursuant to reviews by the Chief Executive Officer of the Company.

          5.2  Bonus
               -----

               5.2.1  In General.  During the Employee's employment under this
Agreement, the Employee shall be eligible to participate in any bonus plans as
may be maintained by the Company from time to time for its employees. The terms
of the Employee's participation in such bonus plans shall be determined by the
Chief Executive Officer and the Board of Directors and the Compensation
Committee, or by such person or administrative body as designated by Board of
Directors and Compensation Committee.

               5.2.2  Eligibility for Bonus.  The Employee shall receive a
performance review from the Chief Executive Officer on an annual basis and shall
be eligible for a cash bonus based upon the performance of the Employee for such
period as determined in the sole discretion of the Chief Executive Officer and
the Board of Directors.

          5.3  Benefits.  During his employment under this Agreement, the
Employee shall be entitled to: (i) participation in employee benefit programs,
policies and arrangements, including a 401K Plan, as maintained by the Company
from time to time, in whole or in part, for similarly situated employees of the
Company; and (ii) paid vacation of a minimum of four weeks per year, holidays,
and leave of absence in accordance with the policies of the Company; and (iii)
perquisites as from time to time provided by the Company to its employees.
Vacation shall accrue commencing upon the Effective Date and ending each June
30/th/ thereafter.

                                      -2-
<PAGE>

          5.4  Expenses.  During the Employee's employment under this Agreement,
the Company shall reimburse the Employee for ordinary and reasonable out-of-
pocket expenses incurred by him in the performance of his duties hereunder,
provided that the Employee shall limit, and account to the Company for, such
expenses in accordance with the employee business expense policies and practices
of the Company.

     6. Incentive Stock Compensation
        ----------------------------

          6.1  In General.  During the Employee's employment under this
Agreement, the Employee shall be eligible to participate in any stock incentive
plans as may be maintained by the Company from time to time for employees. The
Employee's awards under such stock incentive plans shall be determined by the
Board of Directors or such person or administrative body as provided under such
plans.

          6.2  Golden Parachute.  If the Company is acquired by a third party by
way of a Change of Control (as defined below) under circumstances where the
Employee does not vote for the acquisition either as a shareholder or as a
member of the Board of Directors, then in that event, the Employee will be
entitled to purchase 150,000 shares of the common stock of the Company at a
price of $1.00 per share. In addition any stock options of the Employee which
are unvested at the time shall vest immediately upon a Change in Control.

     Definition of Change in Control.  (i) The acquisition (other than from the
     -------------------------------
Company) by any Person as defined in this Section 2(d), of the beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended) of 50% or more of either (A) the then
outstanding securities of the Company or (B) the combined voting power of the
then outstanding voting securities of Company entitled to vote generally in the
election of members of the Board or the Board of any corporate successor to the
business of Company (the "Company Voting Stock"); (ii) the closing of a sale or
other conveyance of all or substantially all of the then outstanding shares for
the securities of the Company, or (iii) the effective time of any merger, share
exchange consolidation, or other business combination of the Company if
immediately after such transaction persons who hold a majority of the
outstanding voting securities entitled to vote generally in the election of
directors of the surviving entity (or the entity owning 100% of such surviving
entity) are not persons who, immediately prior to such transaction, held the
Company Voting Stock; provided, however, that a Change in Control shall not
include a public offering of capital stock of the Company.  For purposes of this
Section 2(d), a "Person" means any individual, entity or group within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended, other than employee benefit plans sponsored or maintained by the
Company and corporations controlled by the Company.

     7. Termination of Employment
        -------------------------

          7.1  Termination by the Company without Good Cause.  The Company may
terminate the Employee's employment under this Agreement without Good Cause at
any time by giving prior notice thereof to the Employee. Upon such termination,
the Employee shall be entitled to such compensation as provided in Section
7.1.2. For purposes of this Agreement,

                                      -3-
<PAGE>

"Good Cause" means any of the following, as determined by the Chief Executive
Officer after notice to the Employee:

               (i)    The Employee's conviction of, or plea of nolo contendere
                      to, a felony or crime involving moral turpitude;

               (ii)   The Employee's fraud on, or misappropriation of any funds
                      or property of, the Company;

               (iii)  Personal dishonesty, incompetence or gross negligence in
                      the Employee's performance of his duties;

               (iv)   Willful misconduct by the Employee in connection with the
                      performance of his duties, or the Employee's willful
                      failure to perform his duties and responsibilities in the
                      best interests of the Company;

               (v)    The Employee's repeated use of alcohol, drugs or other
                      similar substances that affect his work performance; or

               (vi)   Breach by the Employee of any provision of this Agreement
                      or any provision of any non-disclosure, non-competition,
                      non-solicitation or other similar agreement executed by
                      the Employee for the benefit of the Company.

               7.1.2  Severance Pay.  If the Employee's employment under this
Agreement is terminated during the Term of this Agreement by the Company without
Good Cause, the Employee shall be entitled to continued payment of his Base
Salary following the effective date of termination (as specified by the
Company), at the rate in effect immediately before the date of termination, for
a period equal to the lesser of 12 months or the remainder of the Employment
Term, provided that the Employee (A) honors the restrictive covenants as
provided in Section 8 of this Agreement and (B) executes a release of all claims
arising in connection with his employment by the Company, in such form as may
then be used by the Company respecting termination of employees.

          7.2  Termination by the Company for Good Cause; Death or Disability

               7.2.1  Termination by the Company for Good Cause.  The Company
may terminate the Employee's employment under this Agreement for Good Cause by
giving notice thereof to the Employee specifying in reasonable detail the Good
Cause based upon which the Company terminates his employment. Upon such a
termination for Good Cause, the Company shall have no obligation to the Employee
for salary or bonus payments beyond the date of termination.

                                      -4-
<PAGE>

               7.2.2  Termination upon Death or Disability.  This Agreement
shall terminate upon the Employee's death. If the Company determines in good
faith that the Employee has a Significant Disability as defined in this Section,
the Company may terminate his employment under this Agreement by notifying the
Employee thereof at least 30 days before the effective date of termination. For
purposes of this Agreement, "Significant Disability" means the inability of the
Employee to substantially perform his duties under this Agreement by reason of
any physical or mental impairment which can be expected to result in death or
which has lasted or can be expected to last for a continuous period of not less
than six months. If there is any dispute between the parties as to whether the
Employee suffers from a significant Disability, the Company shall select or
approve a physician whose determination of that issue shall bind the parties
hereto.

               7.2.3  Effect of Termination by the Company for Good Cause or
Termination upon Death or Significant Disability. If the Employee's employment
under this Agreement is terminated by the Company for Good Cause or due to the
Employee's death or Significant Disability, all obligations of the Company under
this Agreement shall terminate, except as provided in Section 7.4.

          7.3  Termination by the Employee.  The Employee may terminate his
employment under this Agreement at any time upon 21 days prior written notice
thereof to the Company. The Company may, in its discretion, waive the 21 day
prior notice requirement, in which case the effective date of termination by the
Employee shall be such earlier date specified by the Company. Upon such
termination, all obligations of the Company under this Agreement shall
terminate, except as provided in Section 7.4.

          7.4  Payment of Compensation upon Termination.  Upon a termination of
the Employee's employment with the Company for any reason, the Employee shall be
entitled to receive his Base Salary earned but unpaid through the date of such
termination, on or before the day on which the Employee would have been paid
such amount if his employment hereunder had not been terminated. The Company
shall have no obligation to pay a bonus following the effective date of an
employee termination.

     8.   Restrictive Covenants
          ---------------------

          8.1  Non Competition.  The Employee shall provide his full time, skill
and attention to the business of the Company during the Employment Term of this
Agreement and shall use his best efforts to further the interests of the
business of the Company at all times. The Employee shall not, unless so approved
in writing by the Chief Executive Officer of the Company, during the Employment
Term engage directly or indirectly, in any business other than that of and on
behalf of the Company. In order to provide reasonable protection for the
business of the Company, the Employee shall not for so long as she is employed
directly or indirectly by the Company, during the Employment Term, have any
interests in any other corporation, partnership or other business entity which
directly or indirectly competes with, or conducts a business that is similar to,
the business being conducted by the Company. Nothing contained in this section
shall prohibit the Employee from investing in common stocks or other securities
of

                                      -5-
<PAGE>

publicly held corporations so long as his equity ownership percentage in such
companies does not exceed 1% of the common stock outstanding of any such
corporations.

          8.2  Confidential Information.  The Employee shall at all times hold
in a fiduciary capacity for the benefit of the Company all secret, confidential
or proprietary information, knowledge or data relating to the Company, and all
of its businesses, which shall have been obtained by the Employee during his
employment by the Company and which shall not be or become public knowledge
(other than by acts by the Employee or his representatives in violation of this
Agreement), including, but not limited to, information regarding the Company's
processes, products, clients, customers, vendors financial data, marketing
strategies, business plans, pricing information etc. (the "Confidential
Information"). During the Employee's employment with the Company and after the
termination of such employment, the Employee shall not, without the prior
written consent of the Company, communicate or divulge any Confidential
Information to any Person (as defined in Section 8.6.3) other than the Company
and those designated by it or use any Confidential Information, except for the
benefit of the Company, provided that the Employee may make disclosures to
comply with the law or legal process. Immediately upon termination of the
Employee's employment with the Company at any time and for any reason, the
Employee shall return to the Company all Confidential Information, including,
but not limited to, any and all copies, reproductions, notes or extracts of all
Confidential Information. Furthermore the Employee agrees to turn over to the
Company all inventions, improvements and concepts developed by his while
employed by the Company. Without limiting the foregoing, the Employee agrees to
the following provisions:

               (a)  to disclose, grant and assign to the Company as its
exclusive property, all inventions, improvements and technical or business
innovations and suggestions relating in any way to the business of the Company,
or capable of beneficial use by the Company, developed or conceived by the
Employee solely or jointly with others during the course of his employment or
within twelve (12) months after the termination of his employment, (i) which are
along the lines of the business, work or investigations of the Company or its
affiliates, or (ii) which result from or are suggested by any work which the
Employee may do for the Company;

               (b)  to execute all necessary papers including applications,
assignments, and otherwise provide proper assistance (at the Company's expense),
during and subsequent to employment, to enable the Company to obtain for itself
or its nominees, patents, copyrights, or other legal protection for such
inventions or innovations in any and all countries;

               (c)  to make and maintain for the Company adequate and current
written records of all such inventions or innovations;

               (d)  to take affirmative steps to prevent the disclosure of trade
secrets and other Confidential Information by other Persons, including but not
limited to, potential investors or strategic partners by requesting and
obtaining appropriate confidentiality agreements.

                                      -6-
<PAGE>

          8.3  Solicitation of Employees.  During the Employment Term and the
period of any at-will employment following the Employment Term and for two years
after the date of termination for any reason, the Employee shall not: (i)
solicit, participate in or promote the solicitation of any person who was
employed by the Company, at any time during the three-month period prior to the
Employee's termination of employment, to leave the employ of the Company; or
(ii) on behalf of himself or any other Person, hire, employ or engage any such
person. The Employee further agrees that, during such time, if an employee of
the Company contacts the Employee about prospective employment, the Employee
will inform such employee that he cannot discuss the matter further without
informing the Company.

          8.4  Solicitation of Clients.  During the Employment Term and the
period of any at-will employment following the Employment Term and for two years
after the date of termination for any reason, the Employee shall not, directly
or indirectly, solicit, entice or induce any Client (as defined in Section 8.6)
of the Company to become a Client of any Person other than the Company, or to
modify, curtail or cease its business with the Company, and the Employee will
not assist any Person in taking any such action.

          8.5  Remedies for Breach.  The Employee agrees that damages in the
event of any breach of Sections 8.1 through 8.4 by the Employee would be
difficult to ascertain. The Employee therefore agrees that, notwithstanding
anything in this Agreement to the contrary, including by not limited to the
provisions of Section 15, the Company, in addition to and without limiting any
other remedy or right it may have, shall have the right to an injunction or
other equitable relief in any court of competent jurisdiction, enjoining any
such breach. The Employee hereby waives any and all defenses she may have on the
ground of lack of jurisdiction or competence of the court to grant such an
injunction or other equitable relief. The existence of this right shall not
preclude any other rights and remedies at law or in equity which the Company may
have.

          8.6  Definitions.  For purposes of Section 8, the following
definitions shall apply:

               8.6.1  "Company."  "Company" means mPhase Technologies, Inc. and
all of its subsidiaries and affiliates.

               8.6.2  "Client."  "Client" means any person, entity (including
but not limited to a corporation, partnership or trust), division, business
unit, department or agency which, at the time of termination of the Employee's
employment hereunder or at any time within two years prior thereto, shall have
purchased goods or services from the Company or shall have contacted the Company
to purchase goods or services in the future.

               8.6.3  "Person."  "Person" means any individual or entity,
including but not limited to any corporation, trust, sole proprietorship, joint
venture or partnership.

                                      -7-
<PAGE>

          8.7  Survival of Section 8.  The Employee agrees that the
nondisclosure, non-competition, and non-solicitation agreements in this Section
8 each constitute separate agreements independently supported by good and
adequate consideration and, notwithstanding anything in this Agreement to the
contrary, shall be severable from the other provisions of, and shall survive,
this Agreement.

     9.   Notices.  Any notices, requests, demands and other communications
          -------
provided for by this Agreement shall be sufficient if in writing and if sent by
first class or certified mail to the Employee at the last address he has filed
in writing with the Company or, in the case of the Company, to the Company's
principal executive offices. The parties to this Agreement may change the
address to which notices, requests, demands and other communications shall be
sent by sending written notice of such change of address to the other in the
manner set forth in this Section 9.

     10.  Withholding Taxes.  The Company shall have the right, to the extent
          -----------------
permitted or required by law, to withhold monies from any payment of any kind
due to the Employee under this Agreement in order to satisfy the tax withholding
obligations of the Company under applicable law.

     11.  Successors and Assigns.  The rights, duties and obligations of a party
          ----------------------
hereunder may not be assigned, delegated or assumed without the prior written
consent of the other party, provided that the Company may assign this Agreement
to any subsidiary or successor, without the Employee's consent, and such
assignment shall not constitute, a termination of his employment hereunder.
Nothing herein shall cause a termination of this Agreement upon the acquisition,
reorganization, or merger of the Company.  This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors or permitted assigns.  Nothing herein shall be construed to confer
upon any person not a party hereto any right, remedy or claim under or by reason
of this Agreement.

     12.  Entire Agreement.  This Agreement constitutes the entire understanding
          ----------------
of the Employee and the Company with respect to the subject matter hereof and
supersedes and voids any and all prior and contemporaneous agreements or
understandings, written or oral, regarding the subject matter hereof.

     13.  Amendment and Waiver.  This Agreement may not be changed, modified, or
          --------------------
discharged orally, but only by an instrument in writing signed by the parties.
No waiver of any term or condition of this Agreement shall be effective unless
agreed to in writing between the parties.

                                      -8-
<PAGE>

     14.  Governing Law and Severability.  This Agreement shall be governed by
          ------------------------------
the laws of the State of Connecticut (without giving effect to choice of law
principles or rules thereof that would cause the application of the laws of any
jurisdiction other than the State of Connecticut) and the invalidity or
unenforceability of any provisions hereof shall in no way affect the validity or
enforceability of any other provision. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective only to the extent of such prohibition or unenforceability
without invalidating or affecting the remaining portion of such provision or the
other provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

     15.  Arbitration.  All disputes regarding the Employee's employment with
          -----------
the Company or the termination thereof, including without limitation, all
disputes arising under or related to this Agreement, or the breach or alleged
breach thereof, all claims arising under Title VII of the Civil Rights Act of
1964, the Age Discrimination in Employment Act, the Americans with Disabilities
Act, the Family and Medical Leave Act, all other federal and state employment
discrimination laws, and all claims for wages or other compensation, personal
injury, emotional distress, pain and suffering and any and all other claims or
counterclaims between the Employee and the Company, shall be submitted to, and
solely determined by, final and binding arbitration conducted by and in
accordance with JAMS L.L.C.'s arbitration rules applicable to employment
disputes then in effect, and the parties agree to be bound by the final award of
the arbitrator in any such proceeding. Notwithstanding the foregoing, this
arbitration provision shall not apply to disputes regarding the Employee's
compliance with Section 8 of this Agreement. The arbitrator shall be held in
Stamford, Connecticut or such other place as the parties may mutually agree, and
shall be conducted only by a single arbitrator who either is agreed to by the
parties or selected in accordance with JAMS L.L.C.'s arbitration rules. Judgment
upon the award by the arbitrator may be entered in any court having jurisdiction
thereof.

     16.  Consultation with Counsel.  The Employee acknowledges that prior to
          -------------------------
executing this Agreement she has had the opportunity to consult with independent
counsel of his personal choice.

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

Employee                                     mPhase Technologies, Inc.

______________________________               By ________________________________
David Klimek                                    Ronald A. Durando
                                                Chief Executive Officer

                                      -9-

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