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EXHIBIT 10.9
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into on _________________ 1996
("Employment Agreement"), by and among BEVERAGE WORKS, INC., a California
corporation ("Employer"), and LYLE R. MAUL ("Employee").
WHEREAS, Employer wishes to employ Employee as Chief Financial Officer
and Chief Operating Officer, with such other duties and responsibilities as
Employer may reasonably assign to Employee consistent with the nature and
character of such employment (the "Position"), and Employee wishes to accept
such employment subject to the terms and conditions of this Employment
Agreement; and
WHEREAS, Employer is in the business of producing beer and other
beverages, and performs services related thereto, and markets such products and
services in the United States and in various foreign countries and has
accumulated valuable and confidential information including trade secrets and
know-how relating to technology, manufacturing procedures, formulas, machines,
marketing plans, sources of supply, business strategies, and other business
records; and
WHEREAS, the giving of the covenants contained herein is a condition
precedent to the employment of Employee in the Position and Employee
acknowledges that the execution of this Employment Agreement and the entering
into of these covenants is an express condition of his employment in the
Position and that said covenants are given in consideration for such employment
and the other benefits conferred upon him by this Employment Agreement.
NOW, THEREFORE, in consideration of such employment and other valuable
consideration, receipt of which is hereby acknowledged Employer and Employee
agree as follows:
1. DUTIES OF EMPLOYEE. Employer hereby employs Employee as its
Chief Financial Officer and Chief Operating Officer and agrees to cause Employee
from time to time to be elected or appointed to such corporate offices or
positions. Employee shall serve in such capacity at Employer's office, or at
such other place as Employer may direct provided that Employer shall not direct
or cause Employee to perform his services from an office outside of Los Angeles
County, California without Employee's prior written consent. Employee's
principal duties and responsibilities shall consist of Employee's corporate
offices and positions which are set forth in the by-laws of Employer from time
to time, over-all responsibility for the development and implementation of
Employer's corporate finance, acquisition strategy, budgeting and accounting,
and such other duties and responsibilities consistent with Employee's corporate
offices and positions which the Board of Directors or Chief Executive Officer of
Employer, from time to time may assign to Employee. Employee shall perform such
other services and duties as may from time to time be assigned to Employee by
Employer's Board of Directors provided that such other services and duties are
not inconsistent with any other term of this Employment Agreement. Except during
vacation periods or in accordance with Employer's personnel policies covering
executive leaves and reasonable periods of illness or
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other incapacitation, Employee shall devote full-time his services to Employer's
business and interests in a manner consistent with Employee's title and office
and Employer's needs for his services. Employee shall perform the duties of
Employee's office and those assigned to Employee by Employer's Board of
Directors with fidelity, to the best of Employee's ability, and in the best
interests of Employer.
2. TERM OF EMPLOYMENT. Employer hereby employs Employee, and
Employee hereby accepts employment with Employer, for four (4) years commencing
on the date of this Employment Agreement ("Employment Period"). Notwithstanding
anything in this Section 2 to the contrary, this Employment Agreement may be
terminated at any time in accordance with Section 6.
3. COMPENSATION OF EMPLOYEE.
3.1 Base Compensation. As compensation for Employee's
services hereunder, Employee shall receive a base salary (the "Base Salary") at
an annual amount of not less than One Hundred Eight Thousand Dollars ($108,000)
payable in bi-monthly installments of Four Thousand Dollars Five Hundred
($4,500) each, or a ratable portion thereof for periods of less than one-half
month. The Board or the Compensation Committee of the Board shall review the
Base Salary at least annually as of the payroll date nearest the anniversary of
this Employment Agreement; and Employer agrees to make such increases in the
Base Salary as the Board may approve from time to time. Once established at a
specific increased annual rate, the Base Salary may not be reduced by Employer
without Employee's written consent.
3.2 Car Allowance. In addition, Employee shall be
entitled to a monthly car allowance of Five Hundred Dollars ($500), which shall
be paid to Employee concurrently with the second (2nd) installment of Employee's
monthly base compensation. The monthly car allowance shall be increased by Fifty
Dollars ($50) each calendar year commencing January 1, 1997.
3.3 Non-accountable T&E Allowance. In addition, Employee
shall be entitled to a monthly non-accountable travel & entertainment allowance
of Five Hundred Dollars ($500), which shall be paid to Employee concurrently
with the second (2nd) installment of Employee's monthly base compensation.
4. EXPENSE REIMBURSEMENTS. Employee shall promptly be reimbursed
for reasonable and actual out-of-pocket expenses incurred by Employee in
performance of Employee's duties and responsibilities hereunder in accordance
with Employer's established personnel policy covering executive officer expense
reimbursements, as such policy may be amended, revised or otherwise changed from
time to time. Employee shall furnish proper vouchers and expense reports and
shall be reimbursed only for those expenses which shall be reimbursable.
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5. VACATION, SICK LEAVE AND OTHER FRINGE BENEFITS. Employee shall
be entitled to four (4) weeks vacation per every twelve (12) month period of
employment hereunder and no more than two (2) weeks vacation at a time. Employee
shall also be entitled to leaves for illness or other incapacitation as is
consistent with Employee's title and Employer's needs for Employee's services,
except as otherwise provided for in Section 6.2. Commencing with calendar year
1997, Employee shall receive Two Thousand Five Hundred Dollars ($2,500) for 1997
and Five Thousand Dollars ($5,000) annually thereafter for life insurance, which
Employee shall have sole authority to appoint beneficiaries, and shall receive
Two Thousand Five Hundred Dollars ($2,500) for 1997 and Five Thousand Dollars
($5,000) annually thereafter for personal legal and accounting services.
Employee shall be entitled to full health and dental insurance coverage,
including covering any deductible, for Employee, Employee's spouse and minor
children. Employee shall be entitled during Employee's employment hereunder to
share or participate in such medical insurance programs or other "fringe"
benefit plans or programs as shall be made available to employees employed by
Employer generally, in accordance with Employer's established personnel
policies, if any, or as established, amended, revised or otherwise changed from
time to time, covering employee benefits.
6. TERMINATION.
6.1 Termination by Employer for Cause. Employer may
terminate this Employment Agreement and Employee's employment hereunder for
Cause (as defined herein) any time effective upon written notice to Employee. As
used herein, the term "Cause" shall mean:
6.1.1 Habitual neglect in the performance of
Employee's material duties as set forth in Section 1 which continues
uncorrected for a period of thirty (30) days after written notice thereof by
Employer to Employee;
6.1.2 Employee's confession or conviction of
theft, fraud, embezzlement, or any other crime involving dishonesty with respect
to Employer or any parent, subsidiary or affiliate of Employer;
6.1.3 Gross negligence involving misfeasance or
nonfeasance by Employee in the performance of Employee's material duties as set
forth in Section 1 which continues uncorrected for a period of thirty (30) days
after written notice thereof by Employer to Employee;
6.1.4 Material violation by Employee of the
provisions of Section 8; or
6.1.5 The representations in Section 7 were
materially false as of the date of this Employment Agreement.
In no event shall the results of Employer's operations or any business agreement
made in good faith by Employee constitute an independent basis for termination
for cause of Employee's employment under this Employment Agreement. Any
termination of Employee's employment
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for cause must be authorized by a majority vote of the Board taken not later
than twelve (12) months after a majority of the members of the Board (other than
Employee) have actual knowledge of the occurrence of the event or conduct
constituting the cause for such termination. If Employee's employment under this
Employment Agreement is terminated by Employer for cause, then Employee shall be
entitled to receive his Base Salary through the effective date of such
termination.
6.2 Termination Upon Death or Disability. This Employment
Agreement and Employee's employment hereunder shall terminate upon Employee's
death or Disability (as defined herein). For this purpose "Disability" means
incapacity, whether by reason of physical or mental illness or disability, which
prevents Employee from substantially performing Employee's material duties as
set forth in Section 1 for six (6) months, or for shorter periods aggregating
six (6) months in any twelve (12) successive calendar months. Upon termination
for death, and unless Employer shall have in force a disability insurance policy
providing for benefits in an amount at least equal thereto, upon termination for
Disability, Employer shall continue to pay the compensation payments pursuant to
Section 3 to the surviving spouse of Employee (or if there is none to Employee's
estate) in the case of death and to Employee or Employee's court appointed
conservator in the case of Disability until the date three (3) months
thereafter. Termination for death shall become effective upon the occurrence of
such event and termination for Disability shall become effective upon written
notice to Employee.
6.3 Events Upon Termination. The termination of this
Employment Agreement pursuant to Section 6.1 and 6.2 shall also result in the
termination of all rights and benefits of Employee under this Employment
Agreement except for any rights to compensation accrued under Section 3 prior to
the date of termination or rights to expense reimbursement under Section 4.
6.4 Payments As Liquidated Damages. In the event Employer
elects to terminate this Employment Agreement prior to the scheduled termination
date for any reason other than Cause, Employer shall continue to make the
compensation payments specified in Section 3 hereof for the entire term, through
and including the scheduled termination date, and such payments shall be deemed
to be liquidated damages for the damage done to Employee's reputation and for
having foregone the opportunity to pursue other employment opportunities while
performing services pursuant to this Employment Agreement. Employer hereby
agrees that such amount shall constitute a realistic and reasonable valuation of
the damages with respect to Employee's claims, and Employee shall not be
required to mitigate his damages by seeking other business, as the damages
resulting to him as a result of the loss of the unique business arrangement set
forth herein could not be mitigated by seeking business elsewhere, nor shall any
monies earned by Employee in any capacity after such termination, attempted
termination or breach act to reduce such damages.
7. EMPLOYEE'S REPRESENTATIONS. Employee represents and warrants
that Employee is free to enter into this Employment Agreement and to perform
each of the provisions contained herein. Employee represents and warrants that
Employee is not restricted or
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prohibited, contractually or otherwise, from entering into and performing this
Employment Agreement, and that Employee's execution and performance of this
Employment Agreement is not a violation or breach of any agreement between
Employee and any other person or entity.
8. NONDISCLOSURE OF CONFIDENTIAL INFORMATION;
OWNERSHIP OF INTELLECTUAL PROPERTY RIGHTS;
NON COMPETITION; COVENANT NOT TO COMPETE .
8.1 Nondisclosure of Confidential Information. During the
term of this Employment Agreement and at all times thereafter, Employee will
keep confidential and will not directly or indirectly divulge to anyone nor use
or otherwise appropriate for Employee's own benefit, or on behalf of any other
person, firm, partnership or corporation by whom Employee might subsequently be
employed or otherwise associated or affiliated with, any Confidential
Information (as defined herein). For this purpose, "Confidential Information"
means any and all customer lists, product formulations, arrangements with
distributors and parties for whom Employer does contract brewing, marketing
information or strategies, trade secrets or other confidential information of
any kind, nature or description concerning any matters affecting or relating to
the business of Employer or any affiliate which derives economic value, actual
or potential, from not being generally known to the public or to other persons
who can obtain economic value from its disclosure or use and which is subject to
efforts by Employer that are reasonable under the circumstances to maintain its
secrecy.
8.2 Employer Intellectual Property Rights. All
intellectual property rights, whether or not patentable or copyrightable, which
(i) are made or developed with the equipment, supplies, facilities, product
formulations, trade secrets, time or other assets of Employer; (ii) relate to
the business, including anticipated research or development, of Employer, or
(iii) result from work performed by Employee for Employer, are and shall remain
the sole property of Employer, and upon request made by Employer, Employee shall
assign any and all rights, including patents and patent rights, trade mark and
trade dress rights, Employee may have therein to Employer. This Section 8.2 does
not apply to any intellectual property rights which are specifically enumerated
in Schedule 8.2 or are the subject of Section 2870 of the California Labor Code.
8.3 Employer Materials. All reports and analysis,
designs, drawings, contracts, contractual arrangements, specifications, computer
software, computer hardware and other equipment, computer printouts, computer
disks, documents, memoranda, notebooks, correspondence, files, lists and other
records, and the like, and all photocopies or other reproductions thereof,
affecting or relating to the business of Employer which Employee shall prepare,
use, construct, observe, possess or control ("Employee Materials"), shall be and
remain the sole property of Employer. Upon termination of this Employment
Agreement, Employee shall deliver promptly to Employer all such Employer
Materials.
8.4 Certain Restrictions on Business Activities. During
the term of this Employment Agreement, Employee agrees that:
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8.4.1 Business Activities. He will not, directly
or indirectly, own an interest in, operate, join, control or participate in, or
be connected as an officer, employee, agent, independent contractor, partner,
shareholder or principal of any corporation, partnership, proprietorship, firm,
association, person or other entity providing services and/or products or a
combination thereof which directly or indirectly compete with Employer's
business, and he will not undertake planning for or organization of any business
activity competitive with Employer's business or combine or conspire with other
employees or representatives of Employer's business for the purpose of
organizing any such competitive business activity, except the purchase of less
than ten percent (10%) of the stock of a publicly traded company which is not
affiliated with Employer.
8.4.2 Solicitation of Customers, Etc. He will not,
directly or indirectly, either for himself or for any other person, firm or
corporation, divert or take away or attempt to divert or take away (and after
the term of this Employment Agreement, call on or solicit or attempt to call on
or solicit) any of Employer's customers or distributors, including but not
limited to, those upon whom Employee called or whom Employee solicited or
serviced or with whom Employee became acquainted while engaged as an employee in
Employer's business.
8.4.3 Solicitation of Employees, Etc. He will not,
directly or indirectly or by action in concert with others, induce or influence
(or seek to induce or influence) any person who is engaged (as an employee,
agent, independent contractor or otherwise) by Employer to terminate his or her
employment or engagement.
8.5 Covenant Not to Compete.
8.5.1 Obligations of Employee. Employee
acknowledges that, as a key management employee, Employee will be involved, on a
high level, in the development, implementation and management of the business
strategies and plans of Employer, which shall also consist of such other
business, units, divisions, subsidiaries or other entities of Employer as
Employer shall determine in its sole discretion from time to time (the
"Business"). By virtue of Employee's unique and sensitive position and special
background, employment of Employee by a competitor of Employer represents a
serious competitive danger to Employer and the Business, and the use of
Employee's talent and knowledge and information about Employer or the Business
can and would constitute a valuable competitive advantage over Employer and the
Business. In view of the foregoing, Employee covenants and agrees that, if
Employee's employment with Employer is terminated by Employee or for cause at
any time, for a period of one year after the date of such termination, but not
longer than the term of this Employment Agreement under Section 2 had employment
not been terminated, Employee will not engage or be engaged, in any capacity,
directly or indirectly, including but not limited as employee, agent,
consultant, manager, executive, owner or stockholder (except as a passive
investor holding less than a 1% equity interest in any enterprise the securities
of which are publicly traded) in any business entity doing business in the
United States engaged in competition with any business conducted by Employer on
the date of termination. This Covenant Not to Compete shall survive the
termination or expiration of the other provisions of this Employment Agreement.
If any
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court determines that this Covenant Not to Compete, or any part thereof, is
unenforceable because of the duration or geographic scope of such provision,
such court shall have the power to reduce the duration or scope of such
provision, as the case may be, and, in its reduced form, such provision shall
then be enforceable.
8.5.2 Continuing Obligations. Employee agrees
that, for one year following his termination of employment with Employer,
Employee shall keep Employer informed of the identification of Employee's
employer and the nature of such employment or of Employee's self-employment.
Employer agrees that, within fifteen (15) days after receiving notice pursuant
to this section of the identification of the prospective employer, the nature of
the employment or self-employment or any change therein, Employer will advise
Employee as to whether such employment constitutes a violation of Section 8.5.1
hereof.
8.5.3 Injunctive Relief. Employee acknowledges
that the violation of the covenants contained in this Section 8.5 would be
detrimental and cause irreparable injury to Employer and its affiliates which
could not be compensated by money damages. Employee agrees that an injunction
from a court of competent jurisdiction is the appropriate remedy for these
provisions, and consents to the entry of an appropriate judgment enjoining
Employee from violating these provisions in the event there is a find of their
breach.
8.6 Severability. Employee agrees, in the event that any
provision of this Section 8 or any word, phrase, clause, sentence or other
portion thereof shall be held to be unenforceable or invalid for any reason,
such provision or portion thereof shall be modified or deleted in such a manner
so as to make this Section 8 as modified legal and enforceable to the fullest
extent permitted under applicable laws. The validity and enforceability of the
remaining provisions or portions thereof shall not be affected thereby and shall
remain valid and enforceable to the fullest extent permitted under applicable
laws. A waiver of any breach of the provisions of this Section 8 shall not be
construed as a waiver of any subsequent breach of the same or any other
provision.
9. MERGER, ETC., OF EMPLOYER. In the event of a future
disposition of (or including) the properties and business of Employer,
substantially or in its entirety, by merger, consolidation, sale of assets, or
otherwise, then Employer may assign this Employment Agreement and all of the
rights and obligations of Employer under this Employment Agreement to the
acquiring or surviving corporation; provided, that such acquiring or surviving
corporation shall assume in writing all of the obligations of the companies
under this Employment Agreement; and provided further, that the companies (in
the event and so long as they or either of them remains in business as an
independent going enterprise) shall remain jointly and severally liable for the
performance of their obligations under this Employment Agreement in the event of
an unjustified failure of the acquiring corporation to perform its obligations
under this Employment Agreement.
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10. GENERAL PROVISIONS.
10.1 Severable Provisions. The provisions of this
Employment Agreement are severable, and if any one or more provisions may be
determined to be judicially unenforceable, in whole or in part, the remaining
provisions shall nevertheless be binding and enforceable.
10.2 Assignment. Neither this Employment Agreement nor any
of the rights or obligations of Employee or Employer hereunder shall be
assignable.
10.3 Arbitration. Any dispute arising under or in
connection with this Employment Agreement shall be subject to arbitration before
the American Arbitration Association ("AAA") at the facility nearest Employer's
principal place of business.
10.4 Attorneys' Fees. If any legal action arises under
this Employment Agreement or by reason of any asserted breach of it, the
prevailing party shall be entitled to recover all costs and expenses, including
reasonable attorneys' fees, incurred in enforcing or attempting to enforce any
of the terms, covenants or conditions, including costs incurred prior to
commencement of legal action, and all costs and expenses, including reasonable
attorneys' fees, incurred in any appeal from an action brought to enforce any of
the terms, covenants or conditions.
10.5 Notices. Any notice to be given to Employer under the
terms of this Employment Agreement shall be addressed to Employer at the address
of Employer's principal place of business, with a copy to Hecht & Steckman,
P.C., 60 East 42nd Street, Suite 5101, New York, New York 10165-5101, Attn:
James G. Smith, Esq., and any notice to be given to Employee shall be addressed
to Employee at his home address last shown on the records of Employer, or at
such other address as either party may hereafter designate in writing to the
other. Any notice required or permitted under this Employment Agreement shall be
in writing and shall be deemed effective: (i) upon receipt in the event of
delivery by hand, including delivery made by private delivery or overnight mail
service where either the recipient or delivery agent executes a written receipt
or confirmation of delivery; or (ii) 48 hours after deposited in the United
States mail, registered or certified mail, return receipt requested, postage
prepaid.
10.6 Waiver. Either party's failure to enforce any
provision or provisions of this Employment Agreement shall not in any way be
construed as a waiver of any such provision or provisions, or prevent that party
thereafter from enforcing each and every other provision of this Employment
Agreement.
10.7 Entire Agreement; Amendments. This Employment
Agreement supersedes any and all other agreements, either oral or in writing,
between the parties hereto with respect to the employment of Employee by
Employer and contains all of the covenants and agreements between the parties
with respect to the employment of Employee by Employer. Each party to this
Employment Agreement acknowledges that no representations, inducements, promises
or agreements, orally or otherwise, have been made by any party, or anyone
acting on behalf of
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any party, which are not embodied herein, and that no other agreement, statement
or promise not contained in this Employment Agreement will be effective only if
it is in writing signed by the party to be charged.
10.8 Titles and Headings. Titles and headings to sections
of this Employment Agreement are for the purpose of reference only and shall in
no way limit, define or otherwise affect the interpretation or construction of
such provisions.
10.9 Counterparts. This document may be executed in one or
more counterparts each of which shall be deemed to be an original and all of
which together shall constitute a single agreement.
10.10 Governing Law. This Employment Agreement shall be
governed by and construed in accordance with the laws of the State of
California.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement
as of the day and year first above written.
EMPLOYEE:
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LYLE R. MAUL
EMPLOYER:
BEVERAGE WORKS, INC.
a California corporation
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By:
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Title:
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