Exhibit 10.7
AGREEMENT dated as of June 14, 1996, between American Craft
Brewing International Limited, a Bermuda company having its principal address at
Xxxx 0X, 0X, Xxxx Xxxxx, 00 Xxxx Xxxxx Hang, Aberdeen, HONG KONG, and Xxxxx X.
Xxx, whose principal home address is listed beneath his signature below (the
"Executive").
The Company and the Executive desire to set forth the terms upon
which the Executive will be employed by the Company during the term of this
Agreement and agree as follows:
1. Working Relationship
1.1 Employment. The Company shall employ the Executive, and the
Executive shall serve as Executive Vice President and Chief Operating Officer,
during the term of this Agreement. The Executive shall use his best efforts,
skill and abilities to faithfully and effectively manage the Company as directed
by the Company's Board of Directors (the "Board"). The Executive shall perform
such supervisory and management functions as may be commensurate with the
Executive's position and such other duties as may from time to time reasonably
be delegated to the Executive by the Board, subject to the terms and conditions
of the organizational documents of the Company.
1.2 Term. The term of this Agreement shall commence on June 14,
1996 (the "Commencement Date"), and shall continue until the second anniversary
hereof or until terminated by the Company or the Executive as hereinafter
provided.
1.3 Full Time. The Executive shall devote his full and exclusive
business time and energies to the performance of his duties under this
Agreement, except that the Executive shall be free to devote reasonable time and
attention to public and charitable affairs and to his personal affairs,
consistent with his duties hereunder.
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2. Compensation
2.1 Base Compensation. As compensation for his services
hereunder, the Company shall pay the Executive each month, payable in arrears,
US$5,000.00 until the closing date of the Company's initial public offering of
common stock and warrants and US$6,000.00, payable in arrears, each month after
such closing date. If this Agreement is terminated, for any reason, during a
calendar month the Company shall pay the Executive on the last business day of
such month an amount equal to the amount specified in the preceding sentence
reduced by multiplying such amount by a quotient, the numerator of which is the
number of days during such month prior to the termination of this Agreement and
the denominator of which is the number of days in such month.
2.2 Bonuses and Profit Sharing. The Company and the Executive
shall negotiate in good faith the participation of the Executive in any bonus
and profit sharing plans provided that the nature and extent of such
participation shall be based upon the success of the Executive and the Company
in meeting performance goals, also to be negotiated in good faith.
2.3 1996 Stock Option Plan. The Executive shall be entitled to
participate in the Company's 1996 Stock Option Plan on the basis described
therein.
3. Fringe Benefits.
3.1 Participation in Benefit and Insurance Plans; Vacation. The
Company will pay premiums of up to $750.00 per month, in the aggregate, for
life, health and disability insurance for the Executive. During his employment
hereunder, the Executive shall be entitled to fifteen calendar days of paid
vacation and holidays in accordance with applicable policies from time to time
adopted by the Company.
3.2 Company Car. The Company will select and provide to the
Executive, free of charge, one automobile of reasonably current model and year
to be used solely by the Executive in performing his duties hereunder. The
Company will provide comprehensive collision, property damage, and public
liability insurance for such automobile and will replace such automobile in the
event it is lost, destroyed or damaged beyond repair unless the same is caused
by the Executive's negligence, recklessness or willful malfeasance. The Company
will also pay all ad valorum taxes and
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license fees for such automobile and will provide for all routine maintenance
therefore. Upon the termination of this Agreement for any reason, the Executive
shall promptly return such automobile to the Company in the same condition as
when received by the Executive, ordinary wear and tear alone excepted.
4. Business Expenses. The Company shall reimburse the Executive
for all travel, lodging, entertainment and other expenses actually incurred by
him in connection with the performance of his duties hereunder, against vouchers
and receipts or other appropriate written evidence of such expenditures, all in
accordance with the policies of the Company applicable thereto. The Executive
shall be reimbursed for coach class airfare on domestic flights and business
class airfare on international flights.
5. Termination of Agreement. Notwithstanding anything contained
in Section 2, 3 or 4 to the contrary and except as provided in Section 6, this
Agreement and all of the obligations hereunder (other than Sections 8, 9 and 10
which shall remain in full force and effect in accordance with the terms
thereof) shall immediately terminate upon the earliest to occur of the
following:
(a) 10 days after written notice of termination to the Company by
the Executive;
(b) immediately upon written notice of termination for cause to
the Executive by the Company; "cause" shall mean (i) fraud or any
other intentional wrongful act, any violation of law (excluding
minor traffic violations), conviction thereof or plea of guilty
or nolo contendre thereto, moral turpitude or other willful
misconduct by the Executive or (ii) the Executive's failure or
refusal to perform, carry out or comply with the Executive's
duties or obligations hereunder in any material respect;
(c) immediately upon written notice of termination without cause
to the Executive by the Company;
(d) upon the death or permanent disability of the Executive;
"permanent disability" shall mean the inability of the Executive
to perform his duties hereunder by reason of physical or mental
disability during any continuous period of four months or for
periods aggregating eight months during any period of twelve
consecutive months; and
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(e) On the second anniversary of the date hereof; provided,
however, that the term of this Agreement shall be automatically
renewed and extended for successive two-year terms on June 14,
1998 and on each June 14 falling on a year whose number is
divisible by two without remainder unless either the Company or
the Executive gives written notice that this Agreement shall not
be renewed, not less than 20 days prior to any such June 14.
6. Termination Payment. If this Agreement is terminated pursuant
to Section 5(c) or 5(d), the Executive or his beneficiary in accordance with the
laws of descent shall be entitled to an amount equal to the product of two and
the Executive's annual compensation as determined in accordance with the first
sentence of Section 2.1 and 12 months of continuous health, life and disability
coverage, as provided in Section 3.1; provided, however, that the Executive
shall be entitled to receive such payments only if he is in full compliance with
Sections 8, 9 and 10.
7. Change in Control.
7.1 If within two years of a change in control, as defined in
Section 7.2, the Executive experiences a reduction of his responsibilities or
compensation, or is terminated, the Executive shall be entitled to receive an
amount equal to the product of two and the Executive's annual compensation as
determined in accordance with the first sentence of Section 2.1 and 12 months of
continuous health, life and disability coverage, as provided in Section 3.1.
7.2 As used in Section ,7.1 "Change in Control" means a change in
control of the Company which will be deemed to have occurred if (i) the
acquisition by any person or entity not controlled by the Company's stockholders
of more than 50% of the Company's then outstanding Stock, (ii) the sale of all
or substantially all of the Company's assets, or (iii) the merger of the Company
with or into a corporation that is not an Affiliate (other than any merger,
continuation, reorganization or similar transaction with or into American Craft
Brewing International Limited, a British Virgin Islands company).
8. Cooperation with the Company After Termination of this
Agreement. Following any notice of termination of employment by the Executive,
the Executive shall fully cooperate with the Company in all matters relating to
the winding up of his pending work on behalf of
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the Company and the orderly transfer of any such pending work to other employees
of the Company as may be designated by the Company.
9. Confidentiality; Return of Property. The Executive
acknowledges that during the term of this Agreement he will receive confidential
information from the Company and subsidiaries of the Company and the respective
clients thereof (each a "Relevant Entity"), accordingly the Executive agrees
that during the term of this Agreement (as it may be extended pursuant to
Section 5(e)) and thereafter for a period of two years, the Executive and his
affiliates shall not, except in the performance of his obligations to the
Company hereunder or as may otherwise be approved in advance by the Company,
directly or indirectly, disclose or use (except for the direct benefit of the
Company) any confidential information that he may learn or has learned by reason
of his association with any Relevant Entity. Upon termination of this Agreement,
the Executive shall promptly return to the Company any and all properties,
records or papers of any Relevant Entity, that may have been in his possession
at the time of termination, whether prepared by the Executive or others,
including, but not limited to, confidential information and keys. For purposes
of this Agreement, "confidential information" includes all data, analyses,
reports, interpretations, forecasts, documents and information concerning a
Relevant Entity and its affairs, including, without limitation, with respect to
clients, products, policies, procedures, methodologies, trade secrets and other
intellectual property, systems, personnel, confidential reports, technical
information, financial information, business transactions, business plans,
prospects or opportunities, (i) that the Company reasonably believes are
confidential or (ii) the disclosure of which could be injurious to a Relevant
Entity or beneficial to competitors of a Relevant Entity, but shall exclude any
information that the Executive is required to disclose under any applicable
laws, regulations or directives of any government agency, tribunal or authority
having jurisdiction in the matter or under subpoena or other process of law. For
purposes of this Agreement, "affiliate" means any entity that, directly or
indirectly, is controlled by, or under common control with, the Executive; for
purposes of this definition, the terms "controlled by" and "under common control
with" means the possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of such person, whether through the
ownership of voting stock, by contract or otherwise.
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10. Non-Competition
10.1 Non-Competition. During the term of this Agreement (as it
may be extended pursuant to Section 5(e)) and thereafter for a period of two
years the Executive agrees that he and his affiliates shall not, anywhere in
Hong Kong or any other location defined by the Company as an area in which the
Company or any of its subsidiaries (the "AmBrew Companies") has operations,
directly or indirectly, (i) engage in any activity competitive with the business
of any of the AmBrew Companies for or on behalf of himself or any other person
or entity engaged in a line of business which competes with the AmBrew
Companies; (ii) solicit or attempt to solicit the business of any clients or
customers of any of the AmBrew Companies for products that are the same or
similar to those offered, sold or produced at any time by any of the AmBrew
Companies; (iii) otherwise divert or attempt to divert from any of the AmBrew
Companies any business whatsoever; (iv) hire or attempt to hire for any business
endeavor any employee or prior employee of any of the AmBrew Companies; or (v)
interfere with any business relationship between any of the AmBrew Companies and
any other person or entity.
10.2 Severability and Reform. If any portion of Section 10.1
shall for any reason be held invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other
provisions of Section 10.1, but Section 10.1 shall be construed as if such
invalid, illegal or unenforceable provision had never been contained therein. It
is the intention of the parties hereto that if any of the restrictions or
covenants contained in Section 10.1 is held to cover a geographic area or to be
for a length of time that is not permitted by applicable law, or in any way
construed to be too broad or invalid, such provision shall not be construed to
be null, void and of no enforceable effect, but to the extent such provision
would be valid or enforceable under applicable law, a court of competent
jurisdiction shall construe and interpret or reform Section 10.1 to provide for
a covenant having the maximum enforceable geographic area, time period and other
provisions (not greater than those contained herein) as shall be valid and
enforceable under such applicable law.
11. Miscellaneous
11.1 Notices. Any notice or communication required or permitted
to be given under this Agreement shall be (a) in writing, (b) delivered by hand,
Federal Express, facsimile transmission or by registered or certified mail
postage prepaid, if to the Company, to the attention of Xxxxx X. X. Xxxxxxxx at
the address set forth above, or if to the Executive at his address set forth
below, or at such
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other addresses as the respective parties may designate by such notice and (c)
deemed to have been given on the date delivered by hand or sent by facsimile,
two business days after deposit with Federal Express and upon receipt after
being deposited with a governmental postal service.
11.2 Governing Law; Consent to Jurisdiction. This Agreement, and
the application or interpretation hereof, shall be governed by and construed in
accordance with the laws of New York applicable to agreements made and to be
performed entirely therein. The Executive irrevocably submits to the
non-exclusive jurisdiction of courts in New York.
11.3 Amendments. This Agreement may be amended only pursuant to
an instrument in writing signed by each of the parties hereto.
11.4 Headings. The headings in this Agreement are for convenience
only and are in no way intended to describe, interpret, define or limit the
scope, extent or intent of this Agreement or any of its provisions.
11.5 Waivers; Rights and Remedies Cumulative. The failure of any
party to pursue any remedy for breach, or to insist upon the strict performance,
of any covenant or condition contained in this Agreement shall not constitute a
waiver thereof or of any other right with respect to any subsequent breach.
Except as otherwise expressly set forth herein, rights and remedies under this
Agreement are cumulative, and the pursuit of any one right or remedy by any
party shall not preclude, or constitute a waiver of, the right to pursue any or
all other remedies. All rights and remedies provided under this Agreement are in
addition to any other rights the parties may have by law, in equity or
otherwise.
11.6 Severability. Except as otherwise provided in Section 10, if
any provision, or portion thereof, of this Agreement, or its application to any
person or entity or circumstance, shall be invalid, illegal or unenforceable to
any extent, the remainder of this Agreement, such provision and their
application shall not be affected thereby, but shall be interpreted without such
unenforceable provision or portion thereof so as to give effect, insofar as is
possible, to the original intent of the parties, and shall otherwise be
enforceable to the fullest extent permitted by law.
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11.7 Successors and Assigns. All of the covenants, terms,
provisions and agreements contained in this Agreement shall be binding upon, and
inure to the benefit of, the parties hereto and, in the case of the Company, its
respective successors and assigns.
11.8 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
11.9 No Third-Party Beneficiaries. Other than as set forth in
Section 6 above, the covenants, obligations and rights set forth in this
Agreement are not intended to benefit any third person or entity.
11.10 Entire Agreement. This Agreement embodies the entire
understanding and agreement between the parties hereto and concerning the
subject matter hereof and supersedes any and all prior negotiations,
understandings or agreements between the parties hereto with respect hereto.
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11.11 Withholding. The payment of any amount pursuant to this
Agreement shall be subject to applicable withholding and payroll taxes, and such
other deductions as may be required under the Company's employee benefit plans,
if any, or under applicable law.
AMERICAN CRAFT BREWING
INTERNATIONAL LIMITED
By: /s/ Xxxxx X. X. Xxxxxxxx
______________________________
Name: Xxxxx X. X. Xxxxxxxx
Title: Chairman of the Board of
Directors
/s/ Xxxxx X. Xxx
______________________________
Xxxxx X. Xxx
Address:
0000 Xxxxx Xx.
______________________________
Xxxxxxxx, Xx. 00000
______________________________
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