ORASURE TECHNOLOGIES INC
EMPLOYMENT AGREEMENT EPITOPE - ROBERT D. THOMPSON
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>2
<FILENAME>0002.txt
<DESCRIPTION>EMPLOYMENT AGREEMENT EPITOPE - ROBERT D. THOMPSON
<TEXT>


                              EMPLOYMENT AGREEMENT


This Employment Agreement is entered into as of January 24, 2000, between Robert
D.  Thompson  ("Employee")  and  Epitope,   Inc.,  an  Oregon  corporation  (the
"Company").

          1.   SERVICES.

               1.1  EMPLOYMENT.   The  Company  agrees  to  employ  Employee  as
president  and chief  executive  officer of the  Company,  and  Employee  hereby
accepts such  employment  in  accordance  with the terms and  conditions of this
Agreement.  Employment shall continue until terminated  pursuant to the terms of
this Agreement.

               1.2   DUTIES.  Employee  shall have the position named in Section
1.1 with  such  powers  and  duties  appropriate  to that  office  (a) as may be
provided by the bylaws of the Company,  (b) as otherwise  set forth in Exhibit A
attached to this Agreement, and (c) as determined by the board of directors from
time to time.  Subject to the  provisions  of  Section  6.4  hereof,  Employee's
position  and duties may be  changed  from time to time  during the term of this
Agreement.  Employee's place of work shall be the Company's headquarters, at its
present location or as it may be relocated.

               1.3   OUTSIDE  ACTIVITIES.  Employee  shall obtain the consent of
the board of directors before he engages, either directly or indirectly,  in any
other  professional  or  business  activities  that may  require an  appreciable
portion of Employee's time or effort to the detriment of the Company's business.
The Company  consents to the consulting  agreement  between Employee and LabOne,
Inc., under which Employee will provide services to LabOne, Inc. ending no later
than March 31, 2000.

               1.4   DIRECTION  OF  SERVICES.   Employee   shall  at  all  times
discharge  his  duties  in  consultation  with and  under  the  supervision  and
direction of the board of directors.

          2.   COMPENSATION AND EXPENSES.

               2.1   SALARY.  As compensation for services under this Agreement,
the Company  shall pay to  Employee a regular  salary of  $22,916.67  per month.
Subject to the  provisions  of Section 6.4  hereof,  such salary may be adjusted
from time to time in the discretion of the board of directors.  Payment shall be
made on a bi-weekly  basis,  less all amounts  required by law or  authorized by
Employee to be withheld or deducted.  The board of directors may also  authorize
payment to  Employee  of  bonuses  at such  times and in such  amounts as may be
determined by the board of directors.

               2.2   ADDITIONAL  EMPLOYEE  BENEFITS.  To  the  extent  otherwise
eligible, Employee shall be entitled to receive or participate in any additional
benefits,  including without limitation  medical and dental insurance  programs,
profit sharing or pension plans, and medical reimbursement plans, which may from
time to time be made available by the Company to corporate officers. The Company
may change or discontinue such benefits at any time in its sole discretion.

                                      -1-
<PAGE>

               2.3   EXPENSES.

                  2.3.1  JOB-RELATED.  The Company shall reimburse  Employee for
all reasonable and necessary  expenses incurred in carrying out his duties under
this Agreement.

                  2.3.2 RELOCATION EXPENSES. The Company shall further reimburse
Employee  for  reasonable  and  necessary  expenses  incurred  as  follows:  (a)
reasonable expenses incurred by Employee in moving himself,  his family, and his
household goods from Olathe, Kansas, to the Portland, Oregon,  metropolitan area
(not to exceed $10,000  without the approval of the chairman of the board in his
discretion at Employee's  request);  (b) up to three months of temporary housing
at a cost of up to $2,800 per month (or such longer time period and/or amount as
may be approved by the  chairman of the board in his  discretion  at  Employee's
request); (c) one round-trip, coach airline ticket per month (up to a maximum of
six) for Employee for travel between Olathe, Kansas, and Portland, Oregon, until
Employee has relocated his residence to the Portland, Oregon, metropolitan area;
and (d) two round-trip,  coach airline tickets for Employee's  spouse for travel
between  Olathe,  Kansas,  and  Portland,  Oregon,  for purposes of locating and
obtaining a new residence in the Portland,  Oregon  metropolitan area.  Employee
shall  present  to the  Company  from time to time an  itemized  account of such
expenses in such form as may be required by the Company.

                  2.3.3  RELOCATION  ALLOWANCE.   The  Company  shall  also  pay
Employee a one-time  relocation  allowance  of $50,000  upon  relocation  of his
residence to the Portland, Oregon metropolitan area.

                  2.3.4 TAX PROVISION. To the extent the payments under Sections
2.3.2 or 2.3.3 are  includable in  Employee's  net taxable  income,  the Company
shall pay  Employee an  additional  amount so that the amount paid to him,  less
taxes at Employee's  effective marginal tax rate, equals the amounts required to
be paid to him under those sections.

                  2.3.5 REAL ESTATE LOAN.  The Company will loan  Employee up to
$75,000 to be applied  toward  Employee's  purchase  of a home in the  Portland,
Oregon metropolitan area. The loan will not bear interest,  will be secured by a
second position  mortgage on the home  purchased,  will be subject to Employee's
execution  of  loan  documentation  satisfactory  to the  Company,  and  will be
repayable upon Employee's sale of his Kansas residence.

               2.4  FEES.  All  compensation  earned  by  Employee,  other  than
pursuant to this Agreement,  as a result of services  performed on behalf of the
Company or as a result of or arising out of any work done by Employee in any way
related to the scientific or business  activities of the Company shall belong to
the  Company.  Employee  shall pay or deliver such  compensation  to the Company
promptly upon receipt. For the purposes of this provision,  "compensation" shall
include,  but is not  limited to, all  professional  and  nonprofessional  fees,
lecture fees, expert testimony fees, publishing fees, royalties, and any related
income,  earnings,  or other  things  of  value;  and  "scientific  or  business
activities of the Company" shall include,  but not be limited to, any project or
projects  in which the  Company  is  involved  and any  subject  matter  that is
directly or indirectly researched,  tested, developed,  promoted, or marketed by
the Company.

                                      -2-
<PAGE>

          3.   STOCK OPTIONS. Employee has been granted non-qualified options to
purchase  375,000  shares of common  stock of the Company at an  exercise  price
equal to 75 percent  of the mean  between  the high and low sales  prices of the
common stock as quoted on The Nasdaq Stock Market on the date of the grant.  The
options will vest over a  three-year  period,  with  one-third of the options to
vest on the first  anniversary  of the grant date and the remainder to vest on a
monthly basis thereafter.

          4.   MATERIALS  PREPARED AND INVENTIONS  MADE DURING  EMPLOYMENT.  The
Company shall be the exclusive owner of all materials,  concepts, and inventions
Employee  prepares,  develops,  or makes  (whether alone or jointly with others)
within  the  scope  of his  employment,  and of all  related  rights  (including
copyrights,   trademarks,   and  patents)  and  proceeds.   Without  limitation,
materials, concepts, and inventions that (a) relate to the Company's business or
actual or demonstrably  anticipated research or development,  or (b) result from
any work performed by Employee for the Company,  shall be considered  within the
scope of  Employee's  employment.  Employee  shall  promptly  disclose  all such
materials,  concepts,  and  inventions to the Company.  Employee  shall take all
action reasonably  requested by the Company to vest ownership of such materials,
consents,  and  inventions  in the  Company  and to permit the Company to obtain
copyright, trademark, patent, or similar protection in its name.

          5.   BUSINESS  PROTECTION  AGREEMENT.  Employee  and the  Company  are
concurrently  entering a Business Protection  Agreement.  Employee's  compliance
with the terms of the Business Protection Agreement is a material requirement of
this Agreement.

          6.   TERMINATION.

               6.1  TERMINATION  UPON  DEATH.  This  Agreement  shall  terminate
immediately upon Employee's death.

               6.2   TERMINATION   BY  EMPLOYEE.   Employee  may  terminate  his
employment under this Agreement by 60 days' written notice to the Company.

               6.3   TERMINATION BY THE COMPANY FOR CAUSE.  Officer's employment
may be  terminated  by the  Company  at any time for cause.  Only the  following
actions,  failures,  or events by or affecting Employee shall constitute "cause"
for termination of Employee by the Company: (i) willful and continued failure by
Employee to  substantially  perform his duties  provided  herein after a written
demand for  substantial  performance is delivered to Employee by the Chairman of
the Board of the Company,  which demand  identifies with reasonable  specificity
the manner in which  Employee has not  substantially  performed his duties,  and
Employee's failure to comply with such demand within a reasonable time; (ii) the
engaging  by  Employee  in  gross  misconduct  or  gross  negligence  materially
injurious to the Company;  (iii) the commission of any act in direct competition
with or materially  detrimental  to the best  interests of the Company;  or (iv)
Employee's  conviction  of  having  committed  a  felony.   Notwithstanding  the
foregoing,  Employee shall not be deemed to have been  terminated by the Company
for cause  unless and until there shall have been  delivered  to him a copy of a
resolution duly adopted by the  affirmative  vote of not less than a majority of
the entire  membership of the board of directors of the Company finding that, in
the good faith opinion of the board of directors,  the Company has cause for the
termination of the employment of Employee as set forth in any of clauses (i)

                                      -3-
<PAGE>

through (iv) above and specifying the particulars  thereof in reasonable detail.
The findings of the board of directors  shall not be binding on the  arbitrators
or other finders of fact in connection  with any  litigation or dispute  arising
out of this Agreement.

               6.4  TERMINATION BY THE COMPANY  WITHOUT  CAUSE.  The Company may
terminate  Employee's  employment under this Agreement  without cause by written
notice to  Employee.  Employee may (but shall not be required to) elect to treat
any of the following events as a termination  without cause,  provided  Employee
acts within 60 days of the event:

                     6.4.1   A material  breach of this Agreement by the Company
and a failure by the  Company to cure the breach  within 30 days after  Employee
has given written notice of the breach to the board of directors.

                     6.4.2   A reduction in  Employee's  salary below the amount
stated in Section 2.1 (except as part of and in proportion to a reduction in all
executive  officers'  salaries) or a change in Employee's title or a substantial
diminution in Employee's duties below those stated in this Agreement.

                     6.4.3   A   requirement   by  the  Company  that   Employee
regularly  report  other than to the board of  directors  or the chairman of the
board.

                     6.4.4   A "Change of Control" of the Company.  For purposes
of this  Agreement,  a "Change of  Control"  shall mean a change of control of a
nature  that  would be  required  to be  reported  in  response  to Item 6(e) of
Schedule 14A of Regulation  14A as in effect on the date hereof  pursuant to the
Securities  Exchange Act of 1934 (the "Exchange  Act");  provided that,  without
limitation,  such a change of control  shall be deemed to have  occurred at such
time as (i) any Acquiring  Person hereafter  becomes the "beneficial  owner" (as
defined in Rule 13d-3 under the Exchange  Act),  directly or  indirectly,  of 30
percent or more of the combined voting power of Voting  Securities;  (ii) during
any period of 12 consecutive  calendar months,  individuals who at the beginning
of such  period  constitute  the  board of  directors  cease  for any  reason to
constitute at least a majority  thereof  unless the election,  or the nomination
for election, by the Company's shareholders of each new director was approved by
a vote of at least a  majority  of the  directors  then still in office who were
directors at the beginning of the period;  (iii) there shall be consummated  (a)
any  consolidation  or merger of the  Company  in which the  Company  is not the
continuing or surviving corporation or pursuant to which Voting Securities would
be converted into cash,  securities,  or other property,  other than a merger of
the Company in which the holders of Voting  Securities  immediately prior to the
merger have the same,  or  substantially  the same,  proportionate  ownership of
common stock of the surviving  corporation  immediately after the merger, or (b)
any sale, lease,  exchange, or other transfer (in one transaction or a series of
related  transactions)  of all,  or  substantially  all,  of the  assets  of the
Company;  or (iv)  approval  by the  shareholders  of the Company of any plan or
proposal for the liquidation or dissolution of the Company. For purposes of this
Agreement,  "Acquiring  Person"  means  any  person  or  related  persons  which
constitute  a "group"  for  purposes  of Section  13(d) and Rule 13d-5 under the
Exchange  Act,  as such  Section  and Rule are in  effect as of the date of this
Agreement;  provided, however, that the term Acquiring Person shall not include:
(i) the Company or any of its  subsidiaries;  (ii) any employee  benefit plan of
the Company or any of its subsidiaries;  (iii) any entity holding voting capital
stock of the Company for or pursuant to the

                                      -4-
<PAGE>

terms of any such  employee  benefit  plan;  or (iv) any person or group  solely
because such person or group has voting  power with respect to capital  stock of
the Company  arising  from a revocable  proxy or consent  given in response to a
public proxy or consent  solicitation  made  pursuant to the  Exchange  Act. For
purposes of this Agreement,  "Voting  Securities" means the Company's issued and
outstanding  securities ordinarily having the right to vote at elections for the
Company's board of directors.

               6.5 COMPENSATION UPON TERMINATION.

                     6.5.1   TERMINATION  UNDER SECTION 6.1, 6.2, OR 6.3. In the
event of a termination of Employee's employment under Sections 6.1, 6.2, or 6.3,
Employee's  regular  compensation  pursuant to Section 2.1 shall be prorated and
payable until the date of termination  and Employee shall be paid any bonus that
has been approved but not yet paid.

                     6.5.2   TERMINATION  UNDER  SECTION  6.4. In the event of a
termination of Employee's employment by the Company without cause as provided in
Section 6.4,  Employee shall continue to be paid the salary  provided in Section
2.1 for 12 months from the date of notice of such termination of employment,  in
the manner and at the times at which regular  compensation  was paid to Employee
during the term of his employment under this Agreement,  except that if Employee
elects to treat an event described in Sections 6.4.1,  6.4.2, 6.4.3, or 6.4.4 as
a termination  without cause but continues to work for the Company or any of its
subsidiaries,  then any amounts  Employee  receives as  compensation  during the
12-month period shall be credited  against the amounts payable to Employee under
this section.  In no other respect shall the amount of any payment  provided for
in this section be reduced by any compensation or benefits earned by employee as
a result of employment after his  termination.  As a condition to receipt of the
compensation  described in the first  sentence of this Section  6.5.2,  Employee
shall sign and deliver a release agreement,  in form and substance  satisfactory
to the  Company  and  Employee,  releasing  all  claims  related  to  Employee's
employment.  The Company's  obligation to pay the amounts stated in this section
shall  terminate  if  Employee  fails to  comply  with the  Business  Protection
Agreement within one year after termination of employment.

          7.   REMEDIES.  The  respective  rights and duties of the  Company and
Employee  under this  Agreement  are in addition  to, and not in lieu of,  those
rights and duties afforded to and imposed upon them by law or at equity.

          8.   SEVERABILITY OF PROVISIONS.  The provisions of this Agreement are
severable,  and if any  provision  hereof is held invalid or  unenforceable,  it
shall  be  enforced  to  the  maximum  extent  permissible,  and  the  remaining
provisions of the Agreement shall continue in full force and effect.

          9.   NONWAIVER.  Failure  by  either  party  at any  time  to  require
performance of any provision of this Agreement  shall not limit the right of the
party failing to require  performance to enforce the provision.  No provision of
this  Agreement may be waived by either party except by a writing signed by that
party.  A  waiver  of any  breach  of a  provision  of this  Agreement  shall be
construed  narrowly  and shall  not be  deemed to be a waiver of any  succeeding
breach of that  provision or a waiver of that  provision  itself or of any other
provision.

                                      -5-
<PAGE>

          10.  ARBITRATION.

               10.1  CLAIMS  COVERED.  All claims or  controversies,  except for
those  excluded  by  Section  10.2  ("claims"),  whether or not  arising  out of
Employee's  employment (or its  termination),  that the Company may have against
the  Employee  or that  Employee  may have  against  the  Company or against its
officers,  directors,  employees  or  agents,  in  their  capacity  as  such  or
otherwise,  shall be resolved as provided in this Section 10. Claims  covered by
this  Section 10  include,  but are not  limited  to,  claims for wages or other
compensation  due;  claims for breach of any  contract or  covenant  (express or
implied); tort claims; claims for discrimination (including, but not limited to,
race, sex, sexual orientation,  religion,  national origin, age, marital status,
or disability); claims for benefits (except where an employee benefit or pension
plan  specifies  that its claims  procedure  shall  culminate in an  arbitration
procedure  different  from this one),  and claims for  violation of any federal,
state, or other governmental law, statute,  regulation, or ordinance,  except as
provided in Section 10.2.

               10.2  NON-COVERED  CLAIMS.  Claims  arising  out of the  Business
Protection  Agreement and workers'  compensation  or  unemployment  compensation
benefits are not covered by this Section 10.  Non-covered claims include but are
not limited to claims by the  Company  for  injunctive  and/or  other  equitable
relief for unfair competition and/or the use and/or  unauthorized  disclosure of
trade secrets or confidential information,  as to which Employee understands and
agrees  that the Company  may seek and obtain  relief from a court of  competent
jurisdiction.

               10.3  REQUIRED  NOTICE OF ALL CLAIMS AND STATUTE OF  LIMITATIONS.
Company and Employee agree that the aggrieved  party must give written notice of
any claim to the other  party  within one year of the date the  aggrieved  party
first has  knowledge of the event giving rise to the claim;  otherwise the claim
shall be void and deemed  waived even if there is a federal or state  statute of
limitations  which  would have given more time to pursue the claim.  The written
notice shall  identify  and  describe the nature of all claims  asserted and the
facts upon which such claims are based.

               10.4 ARBITRATION  PROCEDURES.  Any arbitration shall be conducted
in accordance with the then-current Model Employment  Arbitration  Procedures of
the American  Arbitration  Association  ("AAA"),  modified to substitute for AAA
actions, the United States Arbitration and Mediation Service ("USA&MS"),  before
an  arbitrator  who is  licensed  to  practice  law in the state of Oregon  (the
"Arbitrator"). The arbitration shall take place in or near Portland, Oregon.

                     10.4.1  SELECTION OF ARBITRATOR. The USA&MS shall give each
party a list of 11 arbitrators drawn from its panel of labor-management  dispute
arbitrators.  Each party may strike all names on the list it deems unacceptable.
If only one common name  remains on the lists of all  parties,  that  individual
shall be designated as the  Arbitrator.  If more than one common name remains on
the lists of all parties,  the parties shall strike names alternately until only
one remains.  The party who did not initiate the claim shall strike first. If no
common name  remains on the lists of all parties,  the USA&MS  shall  furnish an
additional list or lists until an Arbitrator is selected.

                                      -6-
<PAGE>

                     10.4.2  APPLICABLE  LAW.  The  Arbitrator  shall  apply the
substantive  law (and the law of  remedies,  if  applicable)  specified  in this
Agreement or federal law, or both, as applicable to the claim(s)  asserted.  The
Arbitrator,  and not any federal,  state,  or local court or agency,  shall have
exclusive  authority  to resolve  any dispute  relating  to the  interpretation,
applicability,  enforceability or formation of this Agreement, including but not
limited to any claim that all or any part of this Agreement is void or voidable.
The arbitration shall be final and binding upon the parties,  except as provided
in this Agreement.

                     10.4.3  AUTHORITY.  The Arbitrator shall have  jurisdiction
to hear and rule on pre-hearing  disputes and is authorized to hold  pre-hearing
conferences by telephone or in person as the  Arbitrator  deems  necessary.  The
Arbitrator  shall have the  authority to entertain a motion to dismiss  and/or a
motion for summary judgment by any party and shall apply the standards governing
such motions under the Federal Rules of Civil  Procedure.  The Arbitrator  shall
render  an  award  and  opinion  in  the  form   typically   rendered  in  labor
arbitrations.

                     10.4.4  REPRESENTATION.  Any party may be represented by an
attorney or other representative selected by the party.

                     10.4.5  DISCOVERY.  Each party shall have the right to take
the deposition of one  individual  and any expert witness  designated by another
party.  Each party also shall have the right to make requests for  production of
documents to any party.  The subpoena right  specified below shall be applicable
to discovery  pursuant to this paragraph.  Additional  discovery may be had only
where the  Arbitrator  selected  pursuant to this  Agreement  so orders,  upon a
showing  of  substantial  need.  At least 30 days  before the  arbitration,  the
parties must exchange lists of witnesses,  including any experts,  and copies of
all exhibits  intended to be used at the arbitration.  Each party shall have the
right to subpoena witnesses and documents for the arbitration.

                     10.4.6  REPORTER. Either party, at its expense, may arrange
for and pay the cost of a court  reporter  to provide a  stenographic  record of
proceedings.

                     10.4.7  POST-HEARING BRIEFS.  Either party, upon request at
the close of hearing,  shall be given leave to file a  post-hearing  brief.  The
time for filing such a brief shall be set by the Arbitrator.

               10.5  ENFORCEMENT.  Either party may bring an action in any court
of competent  jurisdiction  to compel  arbitration  under this  Agreement and to
enforce an arbitration  award.  Except as otherwise  provided in this Agreement,
both the Company and Employee agree that neither shall initiate or prosecute any
lawsuit or administrative action (other than for a non-covered claim) in any way
related to any claim covered by this Agreement.  A party opposing enforcement of
an award may not do so in an enforcement  proceeding,  but must bring a separate
action in any court of competent  jurisdiction to set aside the award, where the
standard  of  review  will be the same as that  applied  by an  appellate  court
reviewing a decision of a trial court sitting without a jury.

               10.6  ARBITRATION  FEES AND COSTS.  Company  and  Employee  shall
equally  share the fees and costs of the  Arbitrator.  Each party  will  deposit
funds or post other

                                      -7-
<PAGE>

appropriate  security  for its share of the  Arbitrator's  fee, in an amount and
manner  determined by the  Arbitrator,  10 days before the first day of hearing.
Each party shall pay for its own costs and  attorneys'  fees,  if any,  provided
that the Arbitrator,  in its sole  discretion,  may award reasonable fees to the
prevailing party in a proceeding.

          11.  GENERAL TERMS AND  CONDITIONS.  This  Agreement  constitutes  the
entire  understanding  of the parties  relating to the employment of Employee by
the  Company,  and  supersedes  and  replaces  all written  and oral  agreements
heretofore made or existing by and between the parties  relating  thereto.  This
Agreement shall be construed in accordance with the laws of the state of Oregon,
without regard to any contrary  conflicts of laws rules thereof.  This Agreement
shall  inure to the benefit of any  successors  or assigns of the  Company.  All
captions used herein are intended  solely for convenience of reference and shall
in no way limit any of the provisions of this Agreement.  Employee  acknowledges
that he signed this Agreement upon his initial employment with the Company.

            The parties have executed this  Employment  Agreement as of the date
stated above.


                                   EPITOPE, INC.



/s/ Robert D. Thompson             By:  /s/ Roger L. Pringle
-----------------------------           -------------------------------------
Robert D. Thompson
                                   Title:  Chairman of the Board of Directors
                                           ----------------------------------

                                      -8-
<PAGE>


                        EXHIBIT A TO EMPLOYMENT AGREEMENT

     SPECIFIC DUTIES OF EMPLOYEE AS PRESIDENT AND CHIEF EXECUTIVE OFFICER


            Employee as the president and chief executive officer of the Company
shall be responsible  for directing all phases of the operations and the overall
management of the Company,  subject to direction by the board of  directors,  as
such  positions are more  particularly  described in Article IV of the bylaws of
the Company.  As president and chief  executive  officer,  Employee shall report
directly to the chairman of the board. In such capacities, Employee shall be the
key executive  responsible for  formulating  and directing  execution of Company
strategy  in all  phases of  operations,  development,  and  planning.  As chief
executive officer,  Employee shall be the Company's  principal  spokesperson and
will  serve  as  operating  management's  principal  liaison  to  the  board  of
directors.

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</DOCUMENT>
