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                                                                    Exhibit 10.7

                              EMPLOYMENT AGREEMENT

          THIS AGREEMENT (the "Agreement"), made in New York, New York as of the
21st day of November, 2002, between Nephros, Inc., a Delaware corporation having
its executive offices and principal place of business at 3960 Broadway, New
York, New York (the "Company"), and Norman J. Barta, an individual currently
residing at 6 Berkeley Place, Fair Lawn, NJ 07410 ("Executive").

     WHEREAS, the Company desires to employ Executive, and Executive desires to
accept such employment on the terms and conditions hereinafter set forth;

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants and agreements
hereinafter set forth, the Company and Executive agree as follows

          1. Term.

                    The term of this Agreement shall be the three-year period
commencing on the date first above written, and ending three years thereafter
(the "Term").

          2. Employment.

               (a) Employment by the Company. Executive agrees to be employed by
the Company during the Term upon the terms and subject to the conditions set
forth in this Agreement. Executive shall serve as President and Chief Executive
Officer of the Company, reporting to the Board of Directors of the Company (the
"Board") and shall have such duties as may be prescribed by the Board from time
to time and which are commonly performed by CEO/Presidents of similar sized
companies conducting similar business, such as, but not limited to, corporate
planning and oversight of the financial, marketing, research and other vital
functions of the organization.

               (b) Performance of Duties. Throughout the Term, Executive shall
faithfully and diligently perform Executive's duties in conformity with the
directions of the Board and serve the Company to the best of Executive's
ability. Executive shall devote Executive's entire working time to the business
and affairs of the Company, subject to vacations and sick leave in accordance
with Company policy and as otherwise permitted herein.

               (c) Place of Performance. During his employment with the Company,
Executive will work at the Company's offices in New York, New York, as necessary
or appropriate or at such other location in the greater New York City area as
the Company may determine. Throughout the Term, Executive agrees to maintain
Executive's personal residence within reasonable access to Executive's place of
employment. Executive recognizes that his duties will require, from time to time
and at the Company's expense (subject to Section 3(g) below), travel to domestic
and international locations.

          3. Compensation and Benefits.

               (a) Base Salary. The Company agrees to pay to Executive a base
salary ("Base Salary") at the annual rate of $150,000 payable in equal
installments consistent with the Company's payroll practices. On the date that
the initial public offering ("IPO") for the

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Company's common stock is offered for sale to the public, Executive's Base
Salary shall increase to $225,000.

               (b) Milestone Bonus. Upon the achievement of any of the
milestones described in this paragraph, the Company shall pay to Executive a
bonus ("Milestone Bonus") equal to 10% of Executive's Base Salary at the time
the milestone is achieved. Executive shall be entitled to a Milestone Bonus upon
the achievement of any one or more of the following:

          (1) MD Diafilter hemodiafiltration device or a related or similar
device is deemed ready to enter a clinical trial by the FDA in the U.S. or an
analogous body outside the U.S., in a region where there exists significant
market opportunity for the sale of such device;

          (2) the completion of the clinical trial, of the device described in
Section 3(b)(1) above in the region described in Section 3(b)(1) above;

          (3) the first regulatory approval, of the device described in Section
3(b)(1) above in the region described in Section 3(b)(1) above;

          (4) a second hemodiafiltration device is deemed ready to enter a
clinical trial by the FDA in the U.S. or an analogous body outside the U.S., in
a region where there exists significant market opportunity for the sale of such
device;

          (5) the completion of the clinical trial of the device described in
Section 3(b)(4) above in the region described in Section 3(b)(4) above;

          (6) the first regulatory approval of the device described in Section
3(b)(4) above in the region described in Section 3(b)(4) above.

          The milestones described in this paragraph may be amended by written
agreement of the parties.

          After the Anniversary Date, as defined in Section 3(d) ("Base Salary
Increase"), at least two realistic milestones shall be added by the Compensation
Committee of the Board, after consultation with Executive, each year and
Executive shall be paid for the achievement of each such milestone an amount to
be determined by the Compensation Committee of the Board, provided that the
total potential payment for milestones (if achieved) each year equals at least
20% of Executive's Base Salary as of the date the milestones are set by the
Compensation Committee of the Board.

               (c) Licensing Bonus. With respect to any licensing agreement or
technology access agreement related to End Stage Renal Disease ("ESRD") therapy
machines and/or filter technology devices (the "Property"), the Company shall
pay to Executive a bonus ("Licensing Bonus") of one percent (1%) of the license
fee or technology access fee due to the Company. Such Licensing Bonus shall be
payable within 10 business days after receipt by the Company of the license fee
or technology access fee, or each installment of the license fee or technology
access fee. The license fee or technology access fee is any fee or payment that
is not tied directly to sales or expressed as a percentage of receipts from
using the Property or as an account per unit produced, also known as a royalty.
Notwithstanding the foregoing, a maximum

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bonus of Five-Hundred-Thousand US Dollars ($500,000) shall be payable to
Executive with respect to any one licensing or technology access agreement
including renewals and amendments, with an aggregate maximum Licensing Bonus
under this Agreement of Two-Million US Dollars ($2,000,000).

               (d) Base Salary Increase. On March 31, 2004 (the "Anniversary
Date"), the Company shall increase Executive's Base Salary by the dollar amount
of each of the six Milestone Bonuses referred to in Section 3(b)(1)-(6) above
which have been achieved during the period preceding such Anniversary Date.

          During each year that Executive is employed hereunder, on or before
each one-year anniversary of the Anniversary Date (such date, the "Review
Date"), the Compensation Committee of the Board shall review Executive's
performance and shall determine, in its sole discretion, whether to further
increase Executive's Base Salary and any increase shall become effective
beginning on the relevant Review Date.

               (e) Grant of Options and Terms Thereof. The Company has granted
or shall grant to Executive an option (the "Option"), pursuant to the Nephros
2000 Equity Incentive Plan, to purchase shares of the Company's common stock
(the "Option Shares"), subject to vesting and forfeiture as set forth in the
Incentive Stock Option Agreement including any amendments, modifications and
successors thereto, attached hereto as Exhibit A.

               (f) Benefits and Perquisites. Executive shall be entitled to
participate in, to the extent Executive is otherwise eligible under the terms
thereof, the benefit plans and programs, and receive the benefits and
perquisites, generally provided to executives of the same level and
responsibility as Executive, including without limitation family medical
insurance, life insurance and disability insurance (subject to
generally-applicable required employee contributions).

               (g) Travel and Business Expenses. Upon submission of itemized
expense statements in the manner specified by the Company, Executive shall be
entitled to reimbursement for reasonable travel and other reasonable business
expenses duly incurred by Executive in the performance of Executive's duties
under this Agreement in accordance with the policies and procedures established
by the Company from time to time for executives of the same level and
responsibility as Executive.

               (h) No Other Compensation or Benefits; Payment. The compensation
and benefits specified in this Section 3 and in Section 4 of this Agreement
shall be in lieu of any and all other compensation and benefits. Payment of all
compensation and benefits to Executive hereunder shall be made in accordance
with the relevant Company policies in effect from time to time to the extent the
same are consistently applied, including normal payroll practices, and shall be
subject to all applicable employment and withholding taxes and other
withholdings.

               (i) Cessation of Employment. In the event Executive shall cease
to be employed by the Company for any reason, then Executive's compensation and
benefits shall cease on the date of such event, except as otherwise provided
herein or in any applicable employee benefit plan or program.

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          4. Termination of Employment.

               (a) Termination. The Company may terminate Executive's employment
for Cause (as defined below), in which case the provisions of Section 4(b) of
this Agreement shall apply. The Company may also terminate Executive's
employment in the event of Executive's Disability (as defined below), in which
case the provisions of Section 4(c) of this Agreement shall apply. The Company
may also terminate Executive's employment for any other reason by written notice
to Executive, in which case the provisions of Section 4(d) of this Agreement
shall apply. If Executive's employment is terminated by reason of Executive's
death, retirement or voluntary resignation, the provisions of Section 4(b) of
this Agreement shall apply.

               (b) Termination for Cause; Termination by Reason of Death or
Retirement or Voluntary Resignation. In the event that Executive's employment
hereunder is terminated during the Term (x) by the Company for Cause (as defined
below), (y) by reason of Executive's death, or (z) by reason of Executive's
voluntary resignation or retirement, then the Company shall pay to Executive
only the (i) accrued, but unpaid Base Salary for services rendered through the
date of termination, and (ii) any Milestone Bonuses due and payable under the
terms of this Agreement through such date of termination and those that become
due and payable within 90 days of such date of termination. For purposes of this
Agreement, "Cause" shall mean (i) conviction of any crime (whether or not
involving the Company) constituting a felony in the jurisdiction involved; (ii)
engaging in any act which, in each case, subjects, or if generally known would
subject, the Company to public ridicule or embarrassment; (iii) gross neglect or
misconduct in the performance of Executive's duties hereunder; (iv) willful
failure or refusal to perform such duties as may reasonably be delegated to
Executive; or (v) material breach of any provision of this Agreement by
Executive; provided, however, that with respect to clauses (iii), (iv) or (v),
Executive shall have received written notice from the Company setting forth the
alleged act or failure to act constituting "Cause" hereunder, and Executive
shall not have cured such act or refusal to act within 30 business days of his
actual receipt of notice.

               (c) Disability. If, as a result of Executive's incapacity due to
physical or mental illness, Executive shall have failed to perform Executive's
duties hereunder on a full time basis for either (i) one hundred twenty (120)
days within any three hundred sixty-five (365) day period, or (ii) ninety (90)
consecutive days, the Company may terminate Executive's employment hereunder for
"Disability". In that event, the Company shall pay to Executive only the
accrued, but unpaid, Base Salary for services rendered through such date of
termination. During any period that Executive fails to perform Executive's
duties hereunder as a result of incapacity due to physical or mental illness (a
"Disability Period"), Executive shall continue to receive the compensation and
benefits provided by Section 3 of this Agreement until Executive's employment
hereunder is terminated; provided, however, that the amount of compensation and
benefits received by Executive during the Disability Period shall be reduced by
the aggregate amounts, if any, payable to Executive under disability benefit
plans and programs of the Company or under the Social Security disability
insurance program.

               (d) Termination By Company For Any Other Reason. In the event
that Executive's employment hereunder is terminated by the Company prior to the
expiration of the Term for any reason other than as provided in Sections 4(b) or
4(c) of this Agreement, then the Company shall pay to Executive:

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(i) any accrued, but unpaid Base Salary for services rendered through such date
of termination;

(ii) any unpaid Milestone Bonuses due, payable or which accrue on or prior to
the date of termination or within 90 days thereafter;

(iii) any unpaid Licensing Bonuses due and payable to Executive whether payable
as a one-time payment or in installments over a period of years; and Licensing
Bonuses for new licensing agreements or technology access agreements procured by
Executive which are consummated on or prior to the date of termination or within
90 days thereafter. Payments of these Licensing Bonuses due to Executive
hereunder, if any, shall survive cessation or termination of Executive's
employment hereunder; and

(iv) the continued payment of the Base Salary, in the amount as of the date of
termination, for the remainder of the Term, such payments to be made at the
times such Base Salary would have been paid had Executive's employment not
terminated.

     Notwithstanding anything to the contrary contained herein, in the event
that Executive shall breach Sections 5, 6 or 7 of this Agreement at any time, in
addition to any other remedies the Company may have in the event Executive
breaches this Agreement, the Company's obligation under clauses (ii), (iii) and
(iv) of this Section 4(d) shall cease and Executive's rights thereto shall
terminate and shall be forfeited.

               (e) Benefits Following Termination. The benefits to which
Executive (or as applicable, his spouse or estate) may be entitled pursuant to
the plans and programs referred to in Section 3(f) hereof upon termination of
Executive's employment shall be determined and paid in accordance with the terms
of such plans and programs, or as may be required by applicable law.

               (f) Release. Payment made and performance by the Company in
accordance with this Section 4 shall operate to fully discharge and release the
Company and its directors, officers, employees, subsidiaries, affiliates,
stockholders, successors, assigns, agents and representatives from any further
obligation or liability with respect to Executive's employment and termination
of employment. Other than providing the compensation and benefits provided for
in accordance with this Section 4, the Company and its directors, officers,
employees, subsidiaries, affiliates, stockholders, successors, assigns, agents
and representatives shall have no further obligation or liability to Executive
or any other person under this Agreement. Company shall have the right to
condition the payment of any amounts pursuant to this Section 4 (other than
payments required by law) upon the delivery by Executive to the Company of a
release in form and substance satisfactory to the Company of any and all claims
Executive may have against the Company and its directors, officers, employees,
subsidiaries, affiliates, stockholders, successors, assigns, agents and
representatives arising out of or related to Executive's employment by the
Company and the termination of such employment.

          5. Exclusive Employment; Noncompetition.

               (a) No Conflict; No Other Employment. During the period of
Executive's employment with the Company, Executive shall not: (i) engage in any
activity which conflicts or interferes with or derogates from the performance of
Executive's duties

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hereunder nor shall Executive engage in any other business activity, whether or
not such business activity is pursued for gain or profit, except as approved in
advance in writing by the Board of Directors of the Company; provided, however,
that Executive shall be entitled to manage his personal investments and
otherwise attend to personal affairs, including charitable activities, in a
manner that does not unreasonably interfere with his responsibilities hereunder,
or (ii) accept any other employment, whether as an executive or consultant or in
any other capacity, and whether or not compensated therefor, unless Executive
receives the prior written approval of the Board of Directors of the Company.

               (b) No Competition. Executive recognizes the highly competitive
nature of the Company's business and that Executive's position with the Company
and access to and use of the Company's and its subsidiaries' confidential
records and proprietary information renders Executive special and unique.
Without limiting the generality of the provisions of Section 2(b) or 5(a) of
this Agreement, Executive shall not (i) during the Term and for a period of one
year after the termination of Executive's employment with the Company for any
reason (the "Restricted Period"), directly or indirectly, own, manage, operate,
join, control, participate in, invest in or otherwise be connected or associated
with, in any manner, including as an officer, director, employee, independent
contractor, stockholder, member, partner, consultant, advisor, agent,
proprietor, trustee or investor, any Competing Business located in the United
States; provided, however, that ownership of 5% or less of the stock or other
securities of a corporation, the stock of which is listed on a national
securities exchange or is quoted on The NASDAQ Stock Market, shall not
constitute a breach of this Section 5, so long as Executive does not in fact
have the power to control, or direct the management of, or is not otherwise
associated with, such corporation.

          For purposes hereof, the term "Competing Business" shall mean any
business or venture which, directly or indirectly, engages in developing medical
equipment in the hemodiafiltration realm for use in ESRD chronic therapy.

               (c) No Solicitation of Employment. During the Term and the
Restricted Period, Executive shall not solicit or encourage any employee of the
Company or its subsidiaries to leave the Company or such subsidiary for any
reason, nor assist any business in doing so, nor employ such an employee in a
Competing Business or any other business.

               (d) Customers of the Company and Its Subsidiaries. Executive
shall not, during the Term and the Restricted Period, except as required by the
Company in the performance by Executive of his duties under this Agreement,
directly or indirectly, on behalf of a Competing Business, contact, solicit or
do business with any "customers" (as defined below) of the Company or of any of
its subsidiaries for the purpose of selling or licensing any product, service,
or technology then sold or licensed by the Company or such subsidiary or
proposed to be sold or licensed by the Company or such subsidiary. For the
purposes of the provisions of this Section 5(d), "customer" shall include any
entity that, within two years prior to the termination of Executive's employment
hereunder, purchased or licensed any product, service, or technology from the
Company or a subsidiary of the Company. The term "customer" also includes any
former customer or potential customer of the Company or any of its subsidiaries
which the Company or such subsidiary has solicited within two years prior to the
termination of Executive's employment hereunder for the purpose of selling or
licensing any product, service,

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or technology then sold or licensed by the Company or such subsidiary or
proposed to be sold or licensed.

               (e) Executive understands that the provisions of this Section 5
may limit his ability to earn a livelihood in a business that competes with the
business of the Company or its subsidiaries, but nevertheless agrees and hereby
acknowledges that the consideration provided under this Agreement is sufficient
to justify the restrictions contained in such provisions. In consideration
thereof and in light of Executive's education, skills and abilities, Executive
agrees that he will not assert in any forum that such provisions prevent him
from earning a living or otherwise are void or unenforceable or should be held
void or unenforceable.

          6. Inventions and Proprietary Property.

               (a) Definition of Proprietary Property. For purposes of this
Agreement, "Proprietary Property" shall mean designs, specifications, ideas,
formulas, discoveries, inventions, improvements, innovations, concepts and other
developments, trade secrets, techniques, methods, know-how, technical and
non-technical data, works of authorship, computer programs, computer algorithms,
computer architecture, mathematical models, drawings, trademarks, copyrights,
customer lists, marketing plans, and all other matters which are legally
protectable or recognized as forms of property, whether or not patentable or
reduced to practice or to a writing.

               (b) Assignment of Proprietary Property to the Company or Its
Subsidiaries. Executive hereby agrees to assign, transfer and set over, and
Executive does hereby assign, transfer and set over, to the Company (or, as
applicable, a subsidiary of the Company), without further compensation, all of
Executive's rights, title and interest in and to any and all Proprietary
Property which Executive, either solely or jointly with others, has conceived,
made or suggested or may hereafter conceive, make or suggest, in the course of
Executive's employment with the Company.

               The assignment of Proprietary Property hereunder includes without
limitation all rights of paternity, integrity, disclosure and withdrawal and any
other rights that may be known as or referred to as moral rights ("Moral
Rights"). To the extent that such Moral Rights cannot be assigned under
applicable law and to the extent the following is allowed by the laws in the
various countries where Moral Rights exist, Executive hereby waives such Moral
Rights and consents to any action of the Company or any subsidiary of the
Company that would violate such Moral Rights in the absence of such consent.
Executive also will endeavor to facilitate such use of any such Moral Rights as
the Company, or, as applicable, a subsidiary of the Company, shall reasonably
instruct, including confirming any such waivers and consents from time to time
as requested by the Company (or, as applicable, a subsidiary of the Company).

               (c) Works for Hire. Executive acknowledges that all original
works of authorship or other creative works which are made by Executive (solely
or jointly with others) within the scope of the employment of Executive by the
Company and which are protectable by copyright are "works made for hire,"
pursuant to United States Copyright Act (17 U.S.C., Section 101). To the extent
such original work of authorship or other creative works are not works made for
hire, Executive hereby assigns to the Company (or, as directed by the Company,
to a subsidiary of the Company) all of the rights comprised in the copyright of
such works.

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               (d) Disclosure of Proprietary Property and Execution of
Documents. Executive further agrees to promptly disclose to the Company any and
all Proprietary Property which Executive has assigned, transferred and set over
or will assign, transfer and set over as provided in Section 6(b) above, and
Executive agrees to execute, acknowledge and deliver to the Company (or, as
applicable, to a subsidiary of the Company), without additional compensation and
without expense to Executive, any and all instruments reasonably requested, and
to do any and all lawful acts which, in the reasonable judgment of the Company
or its attorneys (or, as applicable, a subsidiary of the Company or its
attorneys) may be required or desirable in order to vest in the Company or such
subsidiary all property rights with respect to such Proprietary Property.

               (e) Enforcement of Proprietary Rights. Executive will assist the
Company (or, as applicable, a subsidiary of the Company) in every proper way to
obtain, assign to the Company (or, as directed by the Company, to a subsidiary),
confirm and from time to time enforce, United States and foreign patent trade
secret, trademark, copyright, mask work, and other intellectual property rights
relating to Proprietary Property in any and all countries. To that end Executive
will execute, verify and deliver such documents and perform such other acts
(including appearances as a witness) as the Company, or, as applicable, a
subsidiary of the Company, may reasonably request for use in applying for,
obtaining, perfecting, evidencing, sustaining and enforcing such proprietary
rights and the assignment of such Proprietary Property. In addition, Executive
will execute, verify and deliver assignments of such Proprietary Property and
all rights therein to the Company, its subsidiary or its or their designee. The
obligation of Executive to assist the Company, or, as applicable, a subsidiary
of the Company, with respect to proprietary rights relating to such Proprietary
Property in any and all countries shall continue beyond the termination of
employment, but the Company, or as applicable, a subsidiary of the Company,
shall compensate Executive at a mutually agreed upon fee, in addition to any
expenses, after such termination.

               In the event the Company, or, as applicable, a subsidiary of the
Company, is unable for any reason, after reasonable effort, to secure the
signature of Executive on any document needed in connection with the actions
specified in the preceding paragraph, Executive hereby irrevocably designates
and appoints the Company and its duly authorized officers and agents as agent
and attorney in fact, which appointment is coupled with an interest, to act for
and on behalf of Executive, to execute, verify and file any such documents and
to do all other lawfully permitted acts to further the purposes of the preceding
paragraph with the same legal force and effect as if executed by Executive.
Executive hereby waives and quitclaims to the Company or, as applicable, a
subsidiary of the Company, any and all claims, of any nature whatsoever, which
Executive now or may hereafter have for infringement of any proprietary rights
assigned hereunder to the Company or such subsidiary.

               (f) Third Party Information. To the extent Executive has or
possesses any Confidential Information (as hereinafter defined) belonging to
Executive or to others, Executive shall not use or disclose to the Company or
its subsidiaries or induce the Company or its subsidiaries to use any such
Confidential Information unless the Company or its subsidiaries have a legal
rights to use such Confidential Information. Executive will promptly advise the
Company in writing if any of Executive's involvement with the Company or any
subsidiary of the Company might result in the possible violation of Executive's
undertakings to others or the use of any Confidential Information of Executive
or of others.

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          7. Confidential Information.

               (a) Existence of Confidential Information. The Company owns and
has developed and compiled, and the Company and its subsidiaries will develop
and compile, certain proprietary techniques and confidential information, which
have and will have great value to their businesses (referred to in this
Agreement, collectively, as "Confidential Information"). Confidential
Information includes not only information disclosed by the Company (or, as
applicable, a subsidiary of the Company) to Executive, but also information
developed or learned by Executive during the course or as a result of employment
with the Company, which information shall be the property of the Company or, as
applicable, such subsidiary. Confidential Information includes all information
that has or could have commercial value or other utility in the business in
which the Company or any of its subsidiaries is engaged or contemplates
engaging, and all information of which the unauthorized disclosure could be
detrimental to the interests of the Company or its subsidiary, whether or not
such information is specifically labeled as Confidential Information by the
Company or such subsidiary. By way of example and without limitation,
Confidential Information includes any and all information developed, obtained,
licensed by or to or owned by the Company or any of its subsidiaries concerning
trade secrets, techniques, know-how (including designs, plans, procedures,
merchandising, marketing, distribution and warehousing know-how, processes, and
research records), software, computer programs and designs, development tools,
all Proprietary Property, and any other intellectual property created, used or
sold (through a license or otherwise) by the Company or any of its subsidiaries,
electronic data information know-how and processes, innovations, discoveries,
improvements, research, development, test results, reports, specifications,
data, formats, marketing data and plans, business plans, strategies, forecasts,
unpublished financial information, orders, agreements and other forms of
documents, price and cost information, merchandising opportunities, expansion
plans, budgets, projections, customer, supplier, licensee, licensor and
subcontractor identities, characteristics, agreements and operating procedures,
and salary, staffing and employment information.

               (b) Protection of Confidential Information. Executive
acknowledges and agrees that in the performance of Executive's duties hereunder,
the Company or a subsidiary of the Company may disclose to and entrust Executive
with Confidential Information which is the exclusive property of the Company or
such subsidiary and which Executive may possess or use only in the performance
of Executive's duties to the Company. Executive also acknowledges that Executive
is aware that the unauthorized disclosure of Confidential Information, among
other things, may be prejudicial to the Company's or its subsidiaries'
interests, an invasion of privacy and an improper disclosure of trade secrets.
Executive shall not, directly or indirectly, use, make available, sell, disclose
or otherwise communicate to any corporation, partnership or other entity,
individual or other third party, other than in the course of Executive's
assigned duties and for the benefit of the Company, any Confidential
Information, either during the Term or thereafter. In the event Executive
desires to publish the results of Executive's work for or experiences with the
Company or its subsidiaries through literature, interviews or speeches,
Executive will submit requests for such interviews or such literature or
speeches to the Board of Directors of the Company at least fourteen (14) days
before any anticipated dissemination of such information for a determination of
whether such disclosure is in the best interests of the Company and its
subsidiaries, including whether such disclosure may impair trade secret status
or constitute an invasion of privacy. Executive agrees not to publish, disclose
or otherwise

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disseminate such information without the prior written approval of the Board of
Directors of the Company.

               (c) Delivery of Records, Etc. In the event Executive's employment
with the Company ceases for any reason, Executive will not remove from the
Company's premises without its prior written consent any records (written or
electronic), files, drawings, documents, equipment, materials and writings
received from, created for or belonging to the Company or its subsidiaries,
including those which relate to or contain Confidential Information, or any
copies thereof. Upon request or when employment with the Company terminates,
Executive will immediately deliver the same to the Company.

          8. Assignment and Transfer.

               (a) Company. This Agreement shall inure to the benefit of and be
enforceable by, and may be assigned by the Company to, any purchaser of all or
substantially all of the Company's business or assets, any successor to the
Company or any assignee thereof (whether direct or indirect, by purchase,
merger, consolidation or otherwise). As soon as reasonable prior to such an
event (but no later than 31 days prior thereto), the Company shall advise
Executive of this pending occurrence. Executive shall then have 31 days to
discuss, negotiate and confer with any successor entity the terms and conditions
of Executive's continued employment with the successor Company. If Executive,
acting reasonably, is unable to reach an agreement, through good faith
negotiations with any successor to the Company, acting reasonably, Executive may
terminate his employment with the Company and receive the payments and bonuses
outlined in Section 4(d) hereof ("Termination By Company For Any Other Reason").

               (b) Executive. Executive's rights and obligations under this
Agreement shall not be transferable by Executive by assignment or otherwise, and
any purported assignment, transfer or delegation thereof shall be void;
provided, however, that if Executive shall die, all amounts then payable to
Executive hereunder shall be paid in accordance with the terms of this Agreement
to Executive's devisee, legatee or other designee or, if there be no such
designee, to Executive's estate.

          9. Miscellaneous.

               (a) Other Obligations. Executive represents and warrants that
neither Executive's employment with the Company or Executive's performance of
Executive's obligations hereunder will conflict with or violate or otherwise are
inconsistent with any other obligations, legal or otherwise, which Executive may
have. Executive covenants that he shall perform his duties hereunder in a
professional manner and not in conflict or violation, or otherwise inconsistent
with other obligations legal or otherwise, which Executive may have.

               (b) Nondisclosure; Other Employers. Executive will not disclose
to the Company or any of its subsidiaries, or use, or induce the Company or any
of its subsidiaries to use, any proprietary information, trade secrets or
confidential business information of others. Executive represents and warrants
that Executive does not possess any property, proprietary information, trade
secrets and confidential business information belonging to prior employers.

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               (c) Cooperation. Following termination of employment with the
Company for any reason, Executive shall cooperate with the Company, as requested
by the Company, to effect a transition of Executive's responsibilities and to
ensure that the Company is aware of all matters being handled by Executive.

               (d) No Duty to Mitigate. Executive shall be under no duty to
mitigate any losses or damage to the Company with respect to any amounts payable
pursuant to Section 4 of this Agreement.

               (e) Protection of Reputation. During the Term and thereafter,
Executive agrees that he will take no action which is intended, or would
reasonably be expected, to harm the Company or any of its subsidiaries or its or
their reputations or which would reasonably be expected to lead to unwanted or
unfavorable publicity to the Company or any of its subsidiaries, other than
those required in order to permit Executive to comply with applicable law or
those made in connection with legal or arbitral process. During the Term and
thereafter, the Company agrees that it will take no actions which are intended,
or would reasonably be expected, to harm Executive or his reputation or which
would reasonably be expected to lead to unwanted or unfavorable publicity to the
executive, other than those required in order to permit the Company to comply
with applicable law or those made in connection with legal or arbitral process.
Notwithstanding the foregoing, this paragraph shall not prevent the Company or
Executive from exercising any of their respective rights under this Agreement.

               (f) Governing Law. This Agreement shall be governed by and
construed (both as to validity and performance) and enforced in accordance with
the internal laws of the State of New York applicable to agreements made and to
be performed wholly with such jurisdiction, without regard to principles of the
conflict of laws thereof or where the parties are located at the time a dispute
arises.

               (g) Jurisdiction; Forum.

               (i) All disputes between the parties arising from or in
connection with this Agreement or Executive's employment hereunder, including
those relating to the existence and validity of this Agreement, shall be
submitted to binding arbitration before one arbitrator administered by the
American Arbitration Association ("AAA") under its National Rules for the
Resolution of Employment Disputes at its New York City offices. Judgment upon
the award rendered by the arbitrator may be entered by any court having
jurisdiction thereof. Unless otherwise determined by the arbitrator, as a
consequence of bad faith by either party, the AAA filing fee and AAA hearing fee
shall be divided equally between the parties. Each party shall bear its own
attorneys' fees and costs, provided that in connection with any claims for which
a prevailing party is entitled to recover attorneys' fees or costs pursuant to
statute, the arbitrator shall have the authority to award such fees and costs.

               (ii) Notwithstanding subparagraph (i) above, if a dispute arises
out of or relating to this Agreement, or the breach thereof, the parties hereby
agree first to try in good faith to settle the dispute by mediation administered
by the AAA under its National Rules for the Resolution of Employment Disputes at
its New York City offices, before resorting to arbitration.

                                       11

<PAGE>

               (iii) Notwithstanding subparagraphs (i) and (ii) above, the
Company shall be entitled to seek and obtain from a court injunctive or
equitable relief, including without limitation, a temporary restraining order
and/or preliminary injunction, to enforce the terms of Sections 5, 6 or 7 of
this Agreement.

               (iv) Each party hereto consents and submits to the jurisdiction
of any arbitration proceeding commenced in accordance with subparagraph (i)
above in connection with any dispute arising out of or relating to this
Agreement or the Executive's employment or termination hereunder and consents
and submits to the jurisdiction of any state or federal court sitting in the
State, City, and County of New York with respect to any proceeding brought (a)
to enter judgment upon the award rendered by the arbitrator or (b) under
subparagraph (iii) hereof.

               (h) Entire Agreement. This Agreement (including all exhibits
hereto) contains the entire agreement and understanding between the parties
hereto in respect of Executive's employment and supersedes, cancels and annuls
any prior or contemporaneous written or oral agreements, understandings,
commitments and practices between them respecting Executive's employment,
including all prior employment agreements, if any, between the Company and
Executive, which agreement(s) hereby are terminated and shall be of no further
force or effect.

               (i) Amendment. This Agreement may be amended only by a writing
which makes express reference to this Agreement as the subject of such amendment
and which is signed by Executive and, on behalf of the Company, by its duly
authorized officer.

               (j) Severability. If any term, provision, covenant or condition
of this Agreement or part thereof, or the application thereof to any person,
place or circumstance, shall be held to be invalid, unenforceable or void by a
court of competent jurisdiction, the remainder of this Agreement and such term,
provision, covenant or condition shall remain in full force and effect, and any
such invalid, unenforceable or void term, provision, covenant or condition shall
be deemed, without further action on the part of the parties hereto, modified,
amended and limited, and the court shall have the power to modify, to the extent
necessary to render the same and the remainder of this Agreement valid,
enforceable and lawful. In this regard, Executive acknowledges that the
provisions of Sections 5, 6 and 7 of this Agreement are reasonable and necessary
for the protection of the Company.

               (k) Construction. The headings and captions of this Agreement are
provided for convenience only and are intended to have no effect in construing
or interpreting this Agreement. The language in all parts of this Agreement
shall be in all cases construed according to its fair meaning and not strictly
for or against the Company or Executive. The use herein of the word "including,"
when following any general provision, sentence, clause, statement, term or
matter, shall be deemed to mean "including, without limitation." As used herein,
"Company" shall mean the Company and its subsidiaries and any purchaser of,
successor to or assignee (whether direct or indirect, by purchase, merger,
consolidation or otherwise) of all or substantially all of the Company's
business or assets which is obligated to perform this Agreement by operation of
law, agreement or otherwise. As used herein, the words "day" or "days" shall
mean a calendar day or days. As used herein, "Compensation Committee" means the
Compensation Committee of the Board or, if no such committee is then serving, at
least two members of the Board as selected by the Board.

                                       12

<PAGE>

               (l) Nonwaiver. Neither any course of dealing nor any failure or
neglect of either party hereto in any instance to exercise any right, power or
privilege hereunder or under law shall constitute a waiver of any other right,
power or privilege or of the same right, power or privilege in any other
instance. All waivers by either party hereto must be contained in a written
instrument signed by the party to be charged and, in the case of the Company, by
its duly authorized officer.

               (m) Remedies for Breach. The parties hereto agree that Executive
is obligated under this Agreement to render personal services during the Term of
a special, unique, unusual, extraordinary and intellectual character, thereby
giving this Agreement special value, and, in the event of a breach or threatened
breach of any covenant of Executive herein, the injury or imminent injury to the
value and the goodwill of the Company's and its subsidiaries' businesses could
not be reasonably or adequately compensated in damages in an action at law.
Accordingly, Executive acknowledges that the Company (and as applicable, one or
more of its subsidiaries) shall be entitled to seek injunctive relief or any
other equitable remedy against Executive in the event of a breach or threatened
breach of Sections 5, 6 or 7 of this Agreement. The rights and remedies of the
Executive and Company are cumulative and shall not be exclusive, and Executive
and Company shall be entitled to pursue all legal and equitable rights and
remedies and to secure performance of the obligations and duties of the other
under this Agreement, and the enforcement of one or more of such rights and
remedies by Executive or Company shall in no way preclude Executive or Company
from pursuing, at the same time or subsequently, any and all other rights and
remedies available to Executive or Company.

               (n) Notices. Any notice, request, consent or approval required or
permitted to be given under this Agreement or pursuant to law shall be
sufficient if in writing, and if and when sent by certified or registered mail,
return receipt requested, with postage prepaid, or by overnight courier, to
Executive's residence, as reflected in the Company's records or as otherwise
designated by Executive with a copy (which shall not constitute notice) to:
Miriam Stern, Esq., 303 East 83rd Street, New York, NY 10028, or to the
Company's principal executive office, attention: Chairman of the Board of
Directors with a copy (which shall not constitute notice) to: Monica Lord, Esq.,
Kramer Levin Naftalis & Frankel LLP, 919 Third Avenue, New York, NY 10022, as
the case may be. All such notices, requests, consents and approvals shall be
effective upon being deposited in the United States mail. However, the time
period in which a response thereto must be given shall commence to run from the
date of receipt on the return receipt of the notice, request, consent or
approval by the addressee thereof. Rejection or other refusal to accept, or the
inability to deliver because of changed address of which no notice was given as
provided herein, shall be deemed to be receipt of the notice, request, consent
or approval sent.

               (o) Assistance in Proceedings, Etc. Executive shall, without
additional compensation during the Term and with complete reimbursement of
expenses after the expiration of the Term, upon reasonable notice, furnish such
information and proper assistance to the Company as may reasonably be required
by the Company in connection with any legal or quasi-legal proceeding, including
any external or internal investigation, involving the Company or any of its
subsidiaries or in which any of them is, or may become, a party.

               (p) Survival. Cessation or termination of Executive's employment
with the Company shall not result in termination of this Agreement. The
respective obligations

                                       13

<PAGE>

of Executive, and rights and benefits afforded to the Company, as provided in
this Agreement, including, without limitation, Sections 5, 6, 7 and 8(o), shall
survive cessation or termination of Executive's employment hereunder.

          IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed on its behalf by an officer thereunto duly authorized and Executive has
duly executed this Agreement, all as of the date and year first written above.

NEPHROS, INC.                             EXECUTIVE

By: /s/ Eric A. Rose, M.D.                /s/ Norman J. Barta
    -----------------------------------   --------------------------------------
    Eric A. Rose, M.D.                        Norman J. Barta
    Chairman of the Board of Directors

                                       14<PAGE>
                                                                    Exhibit 10.8

[LETTERHEAD OF NEPHROS]

AMENDMENT TO EMPLOYMENT AGREEMENT

This is an AMENDMENT (the "Amendment") to the Employment Agreement between
Nephros, Inc. ("the Company") and Norman J. Barta ("Executive") dated November
21, 2002. This Amendment is dated March 17, 2003, and consists of the following
changes:

Paragraph 3(a), Base Salary, is amended as follows: The Company agrees to pay to
Executive a base salary ("Base Salary") at the annual rate of $150,000 payable
in equal installments consistent with the Company's payroll practices. On April
15, 2003, Executive's Base Salary shall increase to $225,000.

Paragraph 3(d), Base Salary Increase, is amended as follows: On July 31, 2004
(the "Anniversary Date"), the Company shall increase Executive's Base Salary by
the dollar amount of each of the six Milestone Bonuses referred to in Section
3(b)(l)-(6) above which have been achieved during the period preceding such
Anniversary Date.

IN WITNESS WHEREOF, the Company has caused this Amendment to be duly executed on
its behalf by an officer thereunto duly authorized and Executive has duly
executed this Amendment, all as of the date and year noted above.

NEPHROS, INC.                                 EXECUTIVE

By: /s/ Eric A. Rose, MD                      /s/ Norman J. Barta
----------------------------------            ----------------------------------
Eric A. Rose, MD                              Norman J. Barta
Chairman of the Board of Directors

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