SERVICE AGREEMENT

Exhibit 99.II-1(aq)

DATED 15^th AUGUST 1999

(1) ENVIROMED PLC

-and-

(2) XXXXX XXXXXXXX

SERVICE AGREEMENT

XXXXXXXX

000 Xxxxxx

Xxxxxx

XX0X 0XX

THIS AGREEMENT is made 5/8/1999

BETWEEN:

(1) ENVIROMED PLC whose registered office is at Xxxxxxxxx Xxxxx, 00/00 Xxxxxxxx Xxxxx, Xxxxxx XX0X 0XX (“the Company”); and

(2) XXXXX XXXXXXXX of Garden Flat, 00 Xxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxx XX0 0XX (“the Executive”)

NOW IT IS AGREED as follows:

1. Definitions

1.1 In this Agreement:

(a) the following expressions have the following meanings:

“the Board”	means the Board of Directors for the time being of the Company or any committee duly appointed by the Board of Directors

“the Employment”	means the Executive’s employment on the terms set out in this Agreement

“the Group”	means the Company and any Group Company

“Group Company”	means any subsidiary of the Company for which purpose the expression “subsidiary” shall have the meanings set out in section 736 of the Companies Xxx 0000

(b) references to clauses, sub-clauses and schedules are unless otherwise stated to clauses and sub-clauses of and schedules to this Agreement;

(c) the headings to the clauses are for convenience only and shall not affect the construction or interpretation of this Agreement.

2. Appointment

2.1 The Company shall employ the Executive and the Executive agrees to act as Finance Director to the Company and Group on and subject to the terms and conditions in this Agreement.

3. Duration of the Employment

3.1 The Employment shall commence on 5 August 1999 and, subject to earlier termination in accordance with the terms of this Agreement, shall continue until terminated by either party giving to the other not less than three months’ notice in writing.

3.2 Notwithstanding clause 3.1, the Employment shall automatically terminate when the Executive reaches the normal retiring age from time to time applicable to directors or executives of the Company.

3.3 The Executive’s period of continuous employment began on 2 August 1993.

4. Hours and place of work

4.1 The Executive shall work such hours as are necessary for the proper performance of his duties, with a minimum of 9.00 a.m. to 5.30 p.m Monday to Friday Lunch breaks are unpaid.

4.2 The Executive’s place of work will initially be the Company’s offices at Xxxxxxxxx Xxxxx, 00/00 Xxxxxxxx Xxxxx, Xxxxxx but the Company may require the Executive to work at any place within [ILLEGIBLE] on either a temporary or an indefinite basis.

4.3 The Executive agrees to undertake any domestic or international travel deemed necessary by the Company for the performance of his duties.

5. Scope of the Employment

5.1 The Executive shall:

(a) Perform duties and exercise powers which are consistent with his position and which are assigned to him by the Board and the Executive agrees to cease performing or exercising any such duty or power at the Board’s request;

(b) comply with all lawful and reasonable directions and requests made by the Board;

(d) faithfully and diligently serve the Company;

(e) use his utmost endeavours to promote and develop the Company’s business;

(f) at all times keep the Board fully informed (in writing or as directed) of his conduct of the financial affairs of the Company;

(h) perform services for any Group Company if so required by the Board; and

(i) comply with the Model Code for transactions in securities by directors published by the London Stock Exchange.

5.2 The Executive shall not:

(a) at any time during the Employment be employed or engaged by or in any other business without consent in writing being given by the Board;

(b) without the Board’s written consent have any direct or indirect financial interest in any business entity which in any way is in a similar field to the Company or any Group Company or which is a client of the Company or any Group Company provided that nothing in this clause shall preclude the Executive from holding any shares or loan capital (not exceeding five per cent of the share or loan capital of the class concerned for the time being in issue) in any company whose shares are listed or dealt in on a recognised stock exchange.

5.3 The Company shall be at liberty to appoint any other person or persons to act jointly with the Executive in any position to which he may be assigned from time to time.

6. Remuneration

6.1 The Company shall pay to the Executive a basic annual salary at the rate of £52,000 payable by equal monthly instalments in arrears on the last working day of each calendar month. The Board will review the Executive’s salary annually on 1 July. The Executive shall have no right to an increase in salary and the award of an increase in any one year shall not confer the right to an increase in any subsequent year.

6.2 The Company may, at its sole discretion, pay the Executive a bonus of such amount as the Board may determine in respect of each complete financial year of the Company during the Employment. The Company may from time to time also link bonuses to the achievement of particular tasks by the Executive. These will be notified in writing.

6.3 The remuneration specified in clauses 6.1 and 6.2 shall be inclusive of any fees to which the Executive may be entitled as a director or officer of the Company or any Group Company.

7. Pension

7.1 The Executive is eligible to continue as a member of the Enviromed PLC Pension Plan, subject to its trust deed and rules from time to time in force. The Scheme is a contracted-out scheme for the purposes of the Xxxxxxx Xxxxxxx Xxx 0000. A contracting-out certificate under the Xxxxxxx Xxxxxxx Xxx 0000 is in force in respect of the Employment. The Scheme may be amended at any time in accordance with the trust deed and rules which govern it.

7.2 The Company shall contribute 12 per cent and the Executive shall contribute a minimum of 3 per cent of his basic annual salary to the Plan (but basic annual salary for this purpose shall not exceed the allowable maximum (earnings cap) from time to time in force pursuant to section 6-10A of Income and Corporation Taxes Act 1988). Payments shall be made monthly in equal instalments.

8. Other Benefits

8.1 The Executive shall be eligible to participate in such medical expenses insurance schemes as the Company may from time to time maintain for the benefit of executives.

8.2 The Executive shall be eligible to participate in a life insurance and permanent disablement scheme under which a lump sum benefit shall be payable on the Executive’s death or permanent total disability while the Employment continues. The benefit shall be paid to such dependants of the Executive or other beneficiary as the trustees of the scheme select at their discretion, after considering any beneficiaries identified by the Executive in any expression of his wishes delivered to the trustees before his death or total disability. The benefit is equal to 3 times the Executive’s basic annual salary at his death or total disability but basic annual salary for this purpose shall not exceed the allowable maximum (earnings cap) from time to time in force pursuant to Section 640A of the Income and Corporation Taxes Act 1988 as at the date of death or total disability.

8.3 Participation in any insurance scheme provided for the Executive under this Agreement:

(a) is subject to its terms and conditions from time to time in force; and

(b) is conditional on the Executive satisfying any applicable requirements of the insurers.

The Company shall not have any liability to pay any benefit to the Executive under any insurance scheme unless it receives payment from the insurer of the scheme.

9. Company Car

9.1 The Company shall provide the Executive with a motor car in accordance with its policy. The Company shall tax and comprehensively insure the car and pay or reimburse, as appropriate, against receipts or other appropriate evidence, the costs of running, servicing and repairing the car.

9.2 The Executive will be permitted to use the car for reasonable private journeys.

9.3 If the Executive shall be convicted of any offence under the Road Traffic Acts or become involved in any accident involving the motor car, he shall forthwith notify the Board and supply such information in connection therewith as the Board may request.

9.4 The Executive shall at all times maintain a current full driving licence and shall not do or omit to do anything which would or might make void or prejudice any insurance policy maintained by the Company. The Executive shall comply with all regulations laid down by the Company from time to time with respect to company cars.

10. Expenses

10.1 The Company shall reimburse the Executive in respect of all expenses reasonably incurred by him in the proper performance of his duties, subject to the Executive providing such receipts or other evidence as the Company may require.

11. Deductions

11.1 For the purposes of the Employment Rights Xxx 0000, sections 13-27, the Executive hereby authorises the Company to deduct from his salary and/or any other sums due under this Agreement any sums due from him to the Company including, without limitation, the Executive’s pension contributions, any overpayments, loans or advances made to him by the Company, the cost of repairing any damage or loss to the Company’s property caused by him.

12. Holidays

12.1 The Executive shall be entitled to receive his normal remuneration for all bank and public holidays normally observed in England and a further 25 working days’ holiday in each holiday year (being the period from 1 January to 31 December). The Company reserves the right to nominate the time at which up to 5 days of annual leave shall be taken. Generally, the Company closes between Christmas and New Year and it may insist that holiday is taken then. The Executive may only take his holiday at such times as are agreed with the Managing Director.

12.2 In the respective holiday years in which the Employment commences or terminates, the Executive’s entitlement to holiday shall accrue on a pro rata basis for each complete month of service during the relevant year.

12.3 If, on the termination of the Employment, the Executive has exceeded his accrued holiday entitlement, an amount in respect of the excess may be deducted from any sums due to him calculated on the same basis as in clause 12.2. If the Executive has any unused holiday entitlement, the Company may either require the Executive to take such unused holiday during any notice period or make a payment in lieu of accrued holiday.

12.4 Holiday entitlement for one holiday year may not be taken in subsequent holiday years unless otherwise agreed by the Board. Failure to take holiday entitlement in the appropriate holiday year will lead to forfeiture of any accrued holiday not taken, without any right to payment in lieu thereof.

13. Sickness benefits

13.1 The Company shall continue to pay the Executive’s full salary during any period or periods of absence on medical grounds up to a maximum of six months (consecutively or in aggregate) in any period of 12 calendar months, provided that the Executive shall from time to time if required:

(a) supply the Company with medical certificates covering any period of sickness or incapacity exceeding seven days (including weekends); and

(b) undergo at the Company’s expense a medical examination by a doctor appointed by the Company.

13.2 Once entitlement to salary under clause 13.1 lapses, the Executive shall be entitled to half pay for a further period of six months after which he shall have no right to any benefit or emolument from the Company other than permanent health benefits.

13.3 Payments to the Executive pursuant to clauses 13.1 and 13.2 shall be inclusive of any Statutory Sick Pay to which the Executive may be entitled.

14. Confidential Information and company documents

14.1 The Executive shall not, either during the Employment (except in the proper performance of his duties) or at any time (without limit) after the termination of the Employment:

(a) divulge or communicate to any person, company, business entity or other organisation;

(b) use for his own purposes or for any purposes other than those of the Company or any Group Company; or

any grade secrets or Confidential Information relating to the Company or any Group Company but so that these restrictions shall cease to apply to any information which shall become available to the public generally otherwise than through the default of the Executive.

14.2 “Confidential Information” shall mean details of suppliers and their terms of business, details of customers and their requirements, the prices charged to and terms of business with customers, marketing plans and sales forecasts, financial information, results and forecasts (save to the extent that these are included in published audited accounts), any proposals relating to the acquisition or disposal of a company or business or any part thereof or to any proposed expansion or contraction of activities, details of employees and officers and of the remuneration and other benefits paid to them, information relating to research activities, inventions, secret processes, designs, formulae and product lines, any information which the Executive is told is confidential and any information which has been given to the Company or any Group Company in confidence by customers, suppliers or other persons.

14.3 All notes, memoranda, records, lists of customers and suppliers and employees, correspondence, documents, computer and other discs and tapes, data listings, codes, designs and drawings and other documents and material whatsoever (whether made or created by the Executive or otherwise) relating to the business of the Company or any Group Company (and any copies of the same):

(a) shall be and remain the property of the Company or the relevant Group Company; and

(b) shall be handed over by the Executive to the Company or to the relevant Group Company on demand and in any event on the termination of the Employment.

15. Termination

15.1 The Employment may be terminated by the Company without notice or payment in lieu of notice if the Executive shall have:

(i) committed any serious breach or repeated or continued (after warning) any material breach of his obligations under this Agreement; or

(ii) been guilty of serious misconduct or conduct tending to bring himself, the Company or any Group Company into disrepute; or

(iii) become bankrupt or had an interim order made against him under the Insolvency Xxx 0000 or compounded with his creditors generally; or

(iv) failed to perform his duties to a standard satisfactory to the Board, after having received a written warning from the Company relating to the same; or

(v) been disqualified from being a director by reason of any order made under the Company Directors Disqualification Act 1986 or any other enactment; or

(vi) been guilty of any breach or non-observance of any code of conduct, rule or regulation or failed or ceased to be registered (where such registration is, in the opinion of the Board, required for the performance of his duties) by any regulatory body in the United Kingdom or elsewhere;

(vii) been convicted of an offence under any statutory enactment or regulation relating to insider dealing; or

(viii) become of unsound mind or a patient within any statute relating to mental health.

Any delay by the Company in exercising such right of termination shall not constitute a waiver thereof.

15.2 If the Company becomes entitled to terminate the appointment of the Executive pursuant to clause 15.1, it shall be entitled (but without prejudice to its right subsequently to terminate such appointment on the same or any other ground) to suspend the Executive on such terms (including the provision or suspension of any benefit) for so long as it may think fit.

15.3 During the whole or part of any period of notice under clause 3.1, the Company may require the Executive to perform duties at any location which the Company shall determine. Alternatively, the Company may require that

the Executive performs no duties at all and/or remains away from Company premises for the duration of any period of notice. Throughout any such period, the Executive shall continue to receive his normal salary and other contractual benefits to which he is entitled under this Agreement but may not work for, or provide services to, any other business or entity.

15.4 On the termination of the Employment or on either the Company or the Executive having served notice of such termination, the Executive shall

(a) at the request of the Company resign from office with the Company and all offices held by him in any Group Company; and

(b) forthwith deliver to the Company all materials within the scope of clause 14.3 and other property of or relating to the business of the Company or of any Group Company which may be in his possession or under his power or control, and if the Executive should fail to do so the Company is by this Agreement irrevocably authorised to appoint some person in his name and on his behalf to sign any documents and do any things necessary or requisite to give effect to such resignation.

16. Grievance procedure

16.1 If the Executive wishes to obtain redress of any grievance relating to the Employment or is dissatisfied with any reprimand, suspension or other disciplinary step taken by the Company, he shall apply in writing to the Chairman of the Board, setting out the nature and details of any such grievance or dissatisfaction.

17. Notices

17.1 Any notice or other document to be given under this Agreement shall be in writing and may be given personally to the Executive or to a director of the Company (as the case may be) or may be sent by first class post or other fast postal service or by facsimile transmission to, in the case of the Company, its registered office for the time being and in the case of the Executive either to his address shown on the face hereof or to his last known place of residence.

17.2 Any such notice shall be deemed served when in the ordinary course of the means of transmission it would first be received by the addressee in normal business hours.

18. Former Service Agreements

18.1 This Agreement shall be in substitution for any previous letters of appointment, agreements or arrangements, whether written, oral or implied, relating to the employment of the Executive.

19. Choice of/law and submission to jurisdiction

19.1 This Agreement shall be governed by and interpreted in accordance with English law.

19.2 The parties submit to the jurisdiction of the Courts of England and Waies.

IN WITNESS whereof this Agreement has been executed the day and year first above written.

EXECUTED AS A DEED by	)
the Company in the presence of:	)
		/s/
		Director

		/s/
		Director / Secretary


EXECUTED AS A DEED by	)
the Executive in the presence of	)	/s/ Xxxxx X. Xxxxxxxx

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SERVICE AGREEMENT

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