EMPLOYMENT AGREEMENT



PARTIES:

                  Quantech Ltd.                               (the "Company")
                  1419 Energy Park Drive
                  St. Paul, Minnesota  55108

                  Gregory G. Freitag                          (the "Employee")
                  1227 Hennepin Avenue
                  Minneapolis, Minnesota   55403

DATE:             December 1, 1997

RECITALS:

                  A. The Company is engaged in the  business of  developing  and
commercializing  certain patents,  technology,  associated  proprietary data and
existing operating  prototypes related to medical diagnostics based upon Surface
Plasmon Resonance.

                  B.  The Employee  seeks  to be employed, and the Company seeks
to employ, Employee under the terms of this Agreement.

                  C.  The Employee agrees that as a condition to employment with
the Company the Employee will abide by the terms of this Agreement.

                  D. The  Employee  desires to be  employed  by the Company in a
capacity in which he may contribute to, or receive confidential information, and
acknowledges  that the Company  will suffer  irreparable  harm if Employee  uses
confidential  information  outside  his  employment  or makes  any  unauthorized
disclosure  of such  confidential  information  to any third  party or uses such
confidential information wrongfully or in competition with the Company.

                  E.  Employee   further   recognizes  that  execution  of  this
Agreement is an express condition of employment.

AGREEMENTS:

                  NOW, THEREFORE, in consideration of the mutual promises herein
contained,  and  other  benefits  now or  hereafter  paid or made  available  to
Employee by the Company, the parties hereby agree as follows:

1.  Employment at Will. The Company hereby employs  Employee as Chief  Operating
Officer  and Chief  Financial  Officer  of the  Company  until  such time as the

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Company or Employee decides to terminate Employee's employment.  Nothing in this
Agreement shall be construed to create an employment relationship other than one
that  is  at  will  or  constituting  a  commitment,   guaranty,  agreement,  or
understanding  of any kind or nature  that  Quantech  shall  continue  to employ
Employee,  nor shall  this  letter  affect in any way the right of  Quantech  to
terminate Employee's employment at any time and for any reason.

2. Duties and Supervision. During the term of this Agreement, Employee agrees to
devote  best  efforts to the  business  and affairs of the Company and agrees to
perform  such  reasonable  services  and  duties as may,  from time to time,  be
assigned to him by the Chief  Executive  Officer.  While employee is employed by
the Company,  Employee will not perform  services for any other person,  firm or
corporation,  either  as an  employee  or  as  an  agent  or  other  independent
contractor  without the express  consent of the Chief  Executive  Officer of the
Company.  Employee  agrees to comply in ever respect with the general  standards
and  policies of the  Company as in effect  from time to time during  Employee's
employment,  all of which the Company  reserves  the right to change in its sole
discretion.

 3.  Compensation.

                  A. Base  Salary.  The  Company  shall pay  Employee an initial
annual salary of $125,000 (the "Base  Salary"),  payable in accordance  with the
Company's  normal payroll  practices in effect from time to time beginning as of
the date  this  Agreement.  The  Employee's  compensation  shall be  subject  to
discretionary upward adjustments by the Company's Chief Executive Officer.

                  B.  Bonus. The Company shall establish a bonus plan consistent
with the Company policy whereby Employee shall be entitle  to receive bonuses in
cash  and/or  securities  of the Company as determined by the Company's Board of
Directors or its compensation committee.

4.    Other Employee Benefits.

                  A.  Benefits.  For so long as Employee remains employed by the
Company, the Company agrees to obtain and maintain for the  benefit of Employee,
health insurance benefits of the same nature as the Company  maintains from time
to time in favor of its employees in general and to provide  such other benefits
as the Company announces from time to time to apply to its employees in general.

                  B.  Disability   Insurance.   Quantech   agrees  to  reimburse
Employee for disability insurance, which reimbursement shall not exceed $150 per
month.

                  C.  Reimbursement  of  Expenses.   The  Company will reimburse
Employee  for  all  of  Employees  out-of-pocket expenses related to the Company
business, provided, however, that any such single expense in excess of $500 will
be approved by the Company's Chief Executive Officer.

5. Payments Upon Termination  Employment.  Employee shall be entitled to six (6)
month's base salary if he is terminated by the Company,  other than for cause as

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provided  in Section 6,  except  that  Employee  shall be entitled to a lump-sum
payment of one (1) year's base salary and bonus if  termination of Employment is
a result of a sale of substantially all of the assets of the Company or a change
in the  control of more than 50% of the  Company's  Common  Stock  pursuant to a
single transaction or a series of transactions by the same acquiring party.

6.  Termination  for  Cause.  Termination  for cause  shall be  defined  as: (i)
Employee's  conviction of or entry of a plea of guilty or nolo contendere to any
felony  against  him in  connection  with any  allegation  against him of fraud,
misrepresentation  or  misappropriation  of property;  (ii) Employee's  theft or
misappropriation  of the Company's  property;  (iii) Employee  knowingly  making
material  false  statements  to the Company's  Board of Directors  regarding the
affairs of the Company;  or (iv) upon written  notice by the Company if Employee
willfully and materially  fails to perform his duties in a reasonable and timely
manner and does not correct such failure  within a period of ten (10) days after
written notice thereof from the Company specifying the nature of such failure of
performance  and  demanding  that it be  cured,  provided,  however,  that  upon
occurrence of the third such failure of a similar nature or the third failure of
any kind,  the  Company  may  terminate  employment  on written  notice  without
opportunity to cure.

7.  General Provisions.

                  A. Injunctive Relief. In addition to any other relief afforded
by law, the Company shall have the right to enforce the  covenants  contained in
this  Agreement  by seeking  injunctive  relief  against  Employee and any other
person concerned  thereby,  it being understood that both damages and injunctive
relief  shall  be  proper  modes  of  relief  and  are not to be  considered  as
alternative remedies.

                  B.  Severability  and  Interpretation.  In  the  event  that a
provision   of  this   Agreement  is  held  invalid  by  a  court  of  competent
jurisdiction,   the  remaining   provisions  shall  nonetheless  be  enforceable
according to their terms. Further, in the event that any provision is held to be
overbroad  as  written,  such  provision  shall be deemed  amended to narrow its
application to the extent necessary to make the provision  enforceable according
to applicable law and shall be enforced as amended.

                  C. Entire  Agreement.  This Agreement  constitutes  the entire
agreement  between the parties and  supersedes any and all prior oral or written
understandings between the parties relating to the subject matter hereof, except
for the Confidentiality and Invention Agreement entered into between the Company
and Employee of even date with this Agreement.

                  D.   Modification   and  Waiver.   No   purported   amendment,
modification or waiver of any provision hereof shall be binding unless set forth
in a  written  document  signed by all  parties  (in the case of  amendments  or
modifications)  or by the party to be charged  thereby (in the case of waivers).
Any waiver shall be limited to the provisions  hereof and the  circumstances  or
event specifically made subject thereto, and shall not be deemed a waiver of any
other term  hereof or of the same  circumstance  or event upon any  reoccurrence
thereof.

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                  E.  Assignment.  This Agreement shall be binding on Employee's
heirs,  assigns  and legal representatives and may be transferred by the Company
to its successors and assigns.

                  F.  Governing Law.  This Agreement is governed by and shall be
construed in accordance with the laws of the State of Minnesota.

                  G.  Arbitration.  All  disputes  arising  under this Agreement
shall  be submitted for arbitration in the state of Minnesota, the United States
of America.

                  IN WITNESS  WHEREOF,  the parties  hereto have  executed  this
Agreement the day and year first above written.

                                        "Company"
                                        QUANTECH LTD.

                                        ----------------------------
                                        Robert Case, CEO

                                        "Employee"


                                        ----------------------------
                                        Gregory Freitag