EXHIBIT 10.4


                              EMPLOYMENT AGREEMENT
                              --------------------

         This  Employment  Agreement  is made and entered  into this 15th day of
December,  1997, by and between Premium Cigars  International,  Ltd., an Arizona
corporation (the "Company") and John E. Greenwell ("Employee").

                              W I T N E S S E T H:
                              --------------------


         WHEREAS, the Company and the Employee mutually desire to agree upon the
terms and conditions of the Employee's employment with the Company;

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency  of which is hereby  acknowledged,  the  parties  to this  Agreement
hereby agree as follows:

         1.  Employment.  The Company agrees to employ the Employee as President
and Chief Operating  Officer for the Company and the Employee shall at all times
exercise his best judgment in the performance of his duties.  As President,  the
Employee shall report directly to the Chief  Executive  Officer and the Board of
Directors  until Employee  assumes the position of Chief  Executive  Officer and
then shall at all times report to the Board of  Directors  of the  Company.  The
Employee  shall  perform such  further  duties as may be required by the Company
under  and  subject  to the  instruction,  direction  and  control  of the Chief
Executive  Officer  or Board of  Directors  of the  Company as  applicable.  All
vice-presidents  and  division  managers  shall  report  directly  to the  Chief
Operating  Officer.  Employee  shall become the Chief  Executive  Officer of the
Company and the Board of Directors  shall create a vacancy and appoint  Employee
to such  vacancy  on the  Board  of  Directors  on March 1,  1998,  unless  this
Agreement is terminated prior to such date. Employee shall, after March 1, 1998,
also retain the capacity of Chief Operating Officer until the Board of Directors
determines   otherwise.   Employee's   duties  under  this  Agreement  shall  be
principally  carried out in Maricopa  County,  Arizona and the parties  agree to
renegotiate this Agreement should the principal geographical focus of Employee's
duties  require that Employee be based  elsewhere  due to the  relocation of the
Company's  executive  offices,  sale of the Company or change in the location of
the Company's business. Except as otherwise provided herein, as long as Employee
remains employed with the Company, the Company shall not alter the terms of this
Agreement  unless  Employee  and the  Company  agree  to such  modifications  in
writing.

         2. Devotion to Employment. Employee accepts employment with the Company
on the terms and conditions  herein set forth and agrees to devote his full time
and effort to perform his duties on behalf of the Company in his position as set
forth in paragraph 1.  Employee  shall begin  full-time  execution of his duties
with the Company on Monday, December 15, 1997. The
<PAGE>
Employee shall not during the term of this Agreement be actively  engaged in any
other  business  activity  which will in any way impair his  ability to properly
meet his obligations to the Company or engage in any activity  competitive  with
the Company or detrimental to its business.  Employee  agrees to comply with the
policies,   standards  and   regulations  of  the  Company  from  time  to  time
established.

         3.  Compensation.  The Company agrees to pay the Employee  compensation
for services as follows:

                  a.  Commencing  December 15, 1997,  the initial  annual salary
         shall  be  One  Hundred  Twenty  Thousand  Dollars  ($120,000)  payable
         bi-weekly during the term of this Agreement.  Employee's  annual salary
         shall increase to One Hundred Fifty  Thousand  Dollars on the date that
         Employee  becomes  the Chief  Executive  Officer of the  Company.  Such
         salary may be adjusted by the Board of  Directors of the Company at its
         sole discretion. Employee understands and acknowledges that Employee is
         exempt from the overtime pay  requirements  of the Fair Labor Standards
         Act, 29 U.S.C. ss. 201 et seq.

                  b. Employee shall be covered under the Company's then existing
         medical insurance plan. The Company retains the right to modify medical
         insurance  coverage  as  it  deems  appropriate.  Except  as  otherwise
         provided for by law or in  paragraph 7 herein,  the Company is under no
         obligation or duty to provide  medical  coverage to the Employee  after
         such Employee has ceased to serve as an employee of the Company.

                  c. Vacation. The Employee shall be entitled to vacation as set
         forth in the Company's employee manual. All vacation days must be taken
         in  accordance  with the  Company's  policies,  as those  policies  are
         established from time to time.

                  d. Bonus Plan;  Stock Option Plan.  Employee shall be eligible
         under a bonus plan  ("Bonus  Plan")  and/or a stock option plan ("Stock
         Option Plan") based upon the future  performance  of the Company in the
         same manner as offered to other  comparable  executives of the Company.
         As a part of his  duties,  Employee  shall  develop  and propose to the
         Board of  Directors a Bonus Plan and Stock  Option Plan for  executives
         and/or other employees of the Company on or before March 1, 1998.
         Notwithstanding the foregoing,
         the parties agree that  Employee's  bonus for the year ending  December
         31, 1998, shall be guaranteed to be at least $50,000.00,  to be paid in
         cash on or before  January  15,  1999.  Other than as  provided  in the
         following  sentence,  if this Agreement is terminated by the Company or
         Employee for any reason on or before  December 31, 1998,  then Employee
         shall be  entitled  to no bonus  payment  hereunder.  However,  even if
         Employee's employment is terminated,  Employee shall be entitled to the
         entire  bonus of at least  $50,000.00,  to be paid in cash on or before
         January 15,  1999,  in any of the  following  two  situations:  (i) the
         Company   terminates  this  Agreement  without  Cause  (as  defined  in
         paragraph 7 below)  after March 31, 1998 but on or before  December 31,
         1998;  or (ii)  Employee  terminates  this  Agreement  on  account of a
         Material Breach by the Company
                                       -2-
<PAGE>
         (as defined in paragraph 7 below) after March 31, 1998 but on or before
         December 31, 1998.

                  e. Additional  Benefits.  Employee shall also be offered other
         benefits,  insurance, stock interest savings loans or bonuses which may
         be offered to other comparable executives of the Company.

         4. Insurance.  The Company shall maintain during the Employee's term of
employment, at the Company's expense, Director and Officer Liability Insurance.

         5.  Employee at Will.  Employee is employed  "at will".  Subject to the
notice  requirements  set forth in  paragraph  6 below,  either  Employee or the
Company may terminate Employee's employment at any time, for any reason, with or
without   cause.   Employee   understands   that  no  manager,   supervisor   or
representative of the Company has any authority to enter into any agreement with
Employee for employment for any specified  period of time or to make any promise
or commitment contrary to the foregoing. Further, no amendment to this Agreement
will be valid or enforceable  unless it is in writing and signed by the Chairman
of the Board of Directors of the Company.

         6. Termination.  The Employee's  continued employment may be terminated
by  the  Employee  by  delivery  to the  other  party  of a  written  notice  of
termination at least four (4) weeks prior to the  termination  date. The Company
may  terminate  Employee's  continued  employment  at any time  upon  notice  of
termination delivered to Employee. Upon termination of employment,  the Employee
agrees to promptly  return to the Company all  customer  records as that term is
defined in paragraph 8 herein,  all  confidential  information,  as that term is
defined in paragraph 9 herein, and all other documents and equipment  pertaining
to the business of the Company.  Employee  further agrees that the Employee will
not at any time use any  information  acquired  by him  during  the term of this
Agreement  in a manner  contrary to the  interest of the  Company,  nor will the
Employee do any act or acts which may directly or  indirectly  induce any person
to terminate his relationship with the Company.

         7. Severance  Compensation.  In the event Employee is terminated by the
Company,  for any reason other than for "Cause" as defined  below or if Employee
terminates  his  employment on account of a "Material  Breach by the Company" as
defined below, Employee shall be entitled to the following:

                  a. If such termination is within the first six (6) months from
         the date of this  Agreement,  Employee  shall be  entitled  to his then
         current salary payable  bi-weekly for a three (3) month period. If such
         termination  is after the first  six (6)  months  from the date of this
         Agreement,  Employee  shall  be  entitled  to his then  current  salary
         payable  bi-weekly for a nine (9) month period.  During the period such
         severance  payments are made by the Company to Employee,  Employee will
         have no duty to  mitigate  the  receipt  of such  severance  payment by
         obtaining other employment, and if Employee should
                                       -3-
<PAGE>
         obtain other employment, the Company shall not receive a credit for any
         compensation  earned by Employee  and shall  continue to pay the entire
         severance payments required hereunder.

                  b. To the extent  Employee has a vested  interest in any stock
         of the Company as of the date of termination of employment,  such stock
         shall be the sole  property  of  Employee  and  shall be under the sole
         control of the  Employee;  however,  Employee  shall have no  ownership
         right to any stock which has not vested.

                  c.  Employee and his family shall  continue to be eligible for
         group medical  coverage,  at  Employee's  personal  expense,  under the
         Consolidated  Omnibus Budget  Reconciliation Act of 1986 ("COBRA"),  as
         amended,  for such  duration as provided by existing law at the time of
         termination.

                  d. The Board of  Directors  agrees to define  terms to protect
         Employee's and other Company executives'  compensation from the effects
         of certain material changes in control of the Company. Such terms shall
         be agreed to on or
         before March 1, 1998.

                  Employee  shall not be entitled to any severance  compensation
as  provided  in this  paragraph  7 if the  Employee  has  committed  any of the
following which shall constitute dismissal for "Cause": (i) willful malfeasance,
willful  misconduct or gross negligence in connection with his employment;  (ii)
continuing refusal or inability to perform Employee's  material duties hereunder
after the Company has given written notice to Employee  specifying  such refusal
or inability to perform such duties and, if curable, Employee cures such refusal
or  inability  within 30 days  following  the date such  notice is  received  by
Employee,  unless such refusal or  inability  cannot be cured within such 30 day
period at which time Employee will have an additional 30 day period to cure such
breach  as long as  Employee  diligently  pursues  the cure of such  refusal  or
inability as set forth in such notice;  (iii) any material breach by Employee of
the provisions of paragraphs 8, 9 or 10 of this Agreement  after the Company has
given  written  notice to  Employee  specifying  such  material  breach  and, if
curable,  Employee cures such material  breach within 30 days following the date
such notice is received by Employee, unless such material breach cannot be cured
within such 30 day period at which time  Employee will have an additional 30 day
period to cure such  breach as long as Employee  diligently  pursues the cure of
such material breach as set forth in such notice;  or (iv) the commission of any
felony or the conviction of a misdemeanor  involving moral turpitude on the part
of Employee.  Further, if during the term of payment of severance  compensation,
Employee  commits  any of the above  acts or  omissions,  no  further  severance
payments shall be made to Employee.

         For  purposes of this  Agreement,  a  "Material  Breach" by the Company
shall only mean any one or more of the following:

                  (i)  Employee's  title  or  substantial   duties  are  changed
         contrary  to the title and  duties  set  forth in  paragraph  1 of this
         Agreement; or
                                       -4-
<PAGE>
                  (ii)  Employee is required to report to persons  other than as
         required by paragraph 1 of this Agreement; or

                  (iii)  Employee is  required to live in a location  other than
         Maricopa County,  Arizona, in order to perform his responsibilities and
         duties under this Agreement; or

                  (iv) The  Company  fails to pay any  amounts  due to  Employee
         hereunder  within ten (10) days of  receipt  by the  Company of written
         notice from Employee specifying such failure to pay.

         Notwithstanding anything mentioned to the contrary herein, in the event
Employee  resigns or terminates this Agreement with the Company other than for a
Material  Breach  by  the  Company  or  if  the  Company  terminates  Employee's
employment  for  Cause,   Employee  shall  not  be  entitled  to  any  severance
compensation.

         8. Customer Records.

                  a. Employee's  Obligations  Regarding  Customer  Records.  The
         Employee  acknowledges  that the  list of the  Company's  customers  or
         clients as it may exist from time to time is a  valuable,  special  and
         unique asset of the Company's business.  The Employee shall not, during
         or after his  employment  with the  Company,  divulge,  furnish or make
         accessible to anyone (other than in the regular course of the Company's
         business)   any  names,   addresses  or  telephone   numbers  of  those
         individuals  who conduct  business with the Company.  In addition,  the
         contents  of  customers'  files  or  portfolios,   or  any  other  such
         information shall be kept confidential  during and after the Employee's
         employment  with the  Company.  All  original  records  and all  copies
         thereof of those customers who do business with the Company,  including
         names, or any other such information,  as well as all other secrets and
         confidential  information  of the Company  shall remain the property of
         the Company during and after the Employee's term of employment with the
         Company.

                  b. Injunctive  Relief for Breach.  In the event of a breach or
         threatened  breach by the Employee of the  provisions  of this section,
         the Company shall be entitled to an injunction restraining the Employee
         from  disclosing,  in  whole  or in  part,  the  list of the  Company's
         customers,   any  names,   addresses  or  telephone  numbers  of  those
         individuals  who conduct  business with the Company,  or from rendering
         any  services  to  any  person,  firm,   partnership,   joint  venture,
         association,  or other entity to whom such information,  in whole or in
         part,  has been  disclosed or is threatened  to be  disclosed.  Nothing
         herein shall be construed as prohibiting  the Company from pursuing any
         other  remedies  available to the Company for such breach or threatened
         breach, including the recovery of damages from the Employee.
                                       -5-
<PAGE>
         9. Confidential Information.

                  a. Employee's Obligations Regarding Confidential  Information.
         Employee has in the past and may in the future develop, obtain or learn
         about confidential  information which is the property of the Company or
         which the Company is under obligation not to disclose.  Employee agrees
         to use his best  efforts and the utmost  diligence to guard and protect
         said  information,  to treat  such  information  as  confidential,  and
         Employee  agrees that the Employee will not, during or after the period
         of his performing services for the Company, use for Employee or others,
         or  divulge  to  others  any of  said  confidential  information  which
         Employee  may  develop,  obtain or learn about during or as a result of
         performing services for the Company,  unless authorized to do so by the
         Company in writing.  Employee  further agrees that if this Agreement is
         terminated for any reason,  Employee will not take, but will leave with
         the Company or return to the Company, all documents, records and papers
         and all  matters  of  whatever  nature  which  bears  or may  bear  the
         Company's  confidential  information  or which  is in any way  related,
         directly or indirectly to the Company.

                  b. Definition of Confidential Information. For the purposes of
         this Agreement,  the term "confidential  information" shall include but
         not be limited  to the  following:  customer  lists;  product  designs;
         pricing policies;  marketing  strategies;  business contacts;  business
         plans; computer software, including all rights under licenses and other
         contracts  relating  thereto;  source code and all  documents  relating
         thereto;  all intellectual  property  including without  limitation all
         trademarks,  trademark  registrations and applications,  service marks,
         copyrights,  patents, trade secrets,  proprietary marketing information
         and know-how;  books and records  including lists of customers;  credit
         reports;  sales records;  price lists;  sales  literature;  advertising
         material;  manuals;  processes;  technology;  designs; statistics data;
         techniques;  or any  information of whatever  nature which gives to the
         Company an opportunity to obtain an advantage over its  competitors who
         do not know or use it,  but it is  understood  that  said  terms do not
         include  knowledge,  skills or information which is common to the trade
         or profession of the Employee.

                  c. Contact with Customers and Third Parties.  Upon  Employee's
         termination of employment with the Company,  Employee agrees that for a
         period of twelve (12) months from the date of termination of employment
         that he shall not contact  directly or indirectly  any of the Company's
         customers or  companies  which have any direct  cigar-related  business
         dealings with the Company.  Notwithstanding the foregoing, Employee may
         contact  customers  or companies  with which the Company does  business
         provided such business contacts do not relate directly or indirectly to
         the cigar-related business.

                  d. Injunctive  Relief for Breach.  In the event of a breach or
         threatened  breach by the Employee of the  provisions  of this section,
         the Company shall be entitled to an injunction restraining the Employee
         from disclosing, in whole or in part, any
                                       -6-
<PAGE>
         confidential information, or from rendering any services to any person,
         firm, partnership,  joint venture, association, or other entity to whom
         such confidential information, in whole or in part, has been disclosed.
         Nothing  herein  shall be  construed  as  prohibiting  the Company from
         pursuing any other remedies available to the Company for such breach or
         threatened breach, including the recovery of damages from the Employee.

         10. Covenant Not To Compete.

                  a.  Interests to be Protected.  The parties  acknowledge  that
         during the term of this  employment,  Employee  will perform  essential
         services  for the Company and for  clients of the  Company.  Therefore,
         Employee will be given an  opportunity  to meet,  work with and develop
         close working  relationships with the Company's clients on a first-hand
         basis and will gain  valuable  insight as to the  clients'  operations,
         personnel and need for services. In addition,  Employee will be exposed
         to, have access to, and be required to work with, a considerable amount
         of the Company's  confidential and proprietary  information,  including
         but not limited to:  information  concerning  the Company's  methods of
         operation,  financial  information,   strategic  planning,  operational
         budget and strategies,  payroll data, computer systems, marketing plans
         and strategies,  merger and acquisition strategies, and customer lists.
         The parties also  expressly  acknowledge  that Employee  holds a highly
         specialized,  professional  position that is the key position in one of
         the Company's most significant divisions and replacing Employee in this
         position would require the Company to incur  substantial  expense.  The
         parties  expressly  recognize  that should  Employee  compete  with the
         Company  in any  manner  whatsoever,  it  could  seriously  impair  the
         goodwill and diminish the value of the Company's business.  The parties
         acknowledge that the covenant not to compete  contained in this section
         has an extended  duration;  however,  they agree that this  covenant is
         reasonable and it is necessary for the  protection of the Company,  its
         shareholders and employees.  For these and other reasons,  and the fact
         that there are many other  employment  opportunities  available  to the
         Employee if he should  terminate,  the parties are in full and complete
         agreement  that  the  following  restrictive  covenants  are  fair  and
         reasonable  and are freely,  voluntarily  and  knowingly  entered into.
         Further,   each  party  was  given  the  opportunity  to  consult  with
         independent legal counsel before entering into this Agreement.

                  b. Restrictions on Competition.  Employee agrees that he shall
         not during the term of this  Agreement  and for a period of twelve (12)
         months from the date of his termination of employment from the Company,
         directly or  indirectly,  either as  principal,  partner,  shareholder,
         joint venturer,  officer,  director,  consultant,  member,  employee or
         otherwise,  own any  interest  in,  manage,  control,  participate  in,
         consult  with,  render  services  for,  or in any manner  engage in any
         business  competing,  directly or indirectly,  with the business of the
         Company (which is cigar distribution) in any state of the United States
         or foreign  country in which the Company is conducting  business on the
         date of Employee's termination. At any time and from time to time, each
         party agrees, at its expense, to take action and to execute and deliver
         documents as may be reasonably  necessary to effectuate the purposes of
         this Covenant.
                                       -7-
<PAGE>
                  c. Judicial  Amendment.  If the scope of any provision of this
         Agreement  is found by any Court to be too broad to permit  enforcement
         to its full  extent,  then  such  provision  shall be  enforced  to the
         maximum  extent  permitted by law. The parties  agree that the scope of
         any  provision  of this  Agreement  may be  modified  by a judge in any
         proceeding  to enforce this  Agreement,  so that such  provision can be
         enforced to the maximum  extent  permitted by law. If any  provision of
         this Agreement is found to be invalid or unenforceable  for any reason,
         it shall not affect the validity of the  remaining  provisions  of this
         Agreement.

                  d.  Injunction;  Remedies  for  Breach.  Since a breach of the
         provisions of this section of this  Agreement  could not  adequately be
         compensated  by  money  damages,  the  Company  shall be  entitled,  in
         addition to any other right or remedy available to it at law or equity,
         to an injunction  restraining  the breach or  threatened  breach and to
         specific   performance  of  any  provision  of  this  section  of  this
         Agreement,  and, in either  case,  no bond or other  security  shall be
         required in connection therewith, and the parties hereby consent to the
         issuance  of  such  an  injunction  and to  the  ordering  of  specific
         performance.

         11. Notices.  All notices  provided for by this Agreement shall be made
in writing  either (i) by actual  delivery  of the notice  into the hands of the
parties  thereunto  entitled  or (ii) the  mailing  of the  notice in the United
States mail to the  address,  as stated  below (or at such other  address as may
have been  designated  by written  notice)  of the party  entitled  thereto,  by
certified  mail,  return  receipt  requested.  The notice  shall be deemed to be
received on the date of its actual  receipt of the party entitled  thereto.  All
communications  hereunder shall be in writing and, if sent to the Company, shall
be delivered to:

                           Premium Cigars
                           15651 N. 83rd Way
                           Suite 3, Building C
                           Scottsdale, Arizona 85260
                           Fax 992-6026
                           Attention:  David Hodges

         with a copy to:

                           Titus, Brueckner & Berry, P.C.
                           7373 North Scottsdale Road
                           Suite B-252
                           Scottsdale, Arizona 85253
                           Attention:  Kurt M. Brueckner
                                       -8-
<PAGE>
and, if sent to the Employee, shall be delivered to:

                           John E. Greenwell
                           16216 North 63rd Place
                           Scottsdale, Arizona 85254

         with a copy to:

                           Charles W. Whetstine
                           8777 North Gainey Center Drive
                           Suite 162
                           Scottsdale, Arizona 85258-2106

         12. Assignment.  This Agreement shall inure to the benefit of and shall
be binding on and enforceable by the parties and their respective successors and
permitted  assigns,  as the case may be. Except as provided for herein,  neither
party  shall  have the right to assign  its  rights  or  obligations  hereunder,
without the prior written consent of the other party.

         13. Miscellaneous.

                  a.  Governing  Law.  This  Agreement  shall be governed by and
         construed in accordance with the law of the State of Arizona.

                  b. Waiver.  No waiver or  modification of this Agreement shall
         be valid unless in writing and duly executed by the party to be charged
         therewith.  Waiver by either  party  hereto of any breach or default by
         the other party of any of the terms and  provisions  of this  Agreement
         shall not operate as a waiver of any other  breach or default,  whether
         similar to or different from the breach or default waiver.

                  c. Severability. All agreements, provisions,  representations,
         warranties and covenants  contained  herein are  severable,  and in the
         event that any one or more of them shall be held to be invalid, illegal
         or unenforceable in any respect by any court of competent jurisdiction,
         the validity,  legality and enforceability of the remaining  provisions
         contained  herein  shall not in any way be affected  thereby,  and this
         Agreement  shall  be  interpreted  as  if  such  invalid,   illegal  or
         unenforceable  agreements,  provisions or covenants  were not contained
         herein.

                  d. Gender.  Whenever the context requires, the masculine shall
         include the feminine and neuter.

                  e. Entire Agreement.  This Agreement  constitutes and embodies
         the full and complete understanding and agreement of the parties hereto
         provided,  and  supersedes  all  prior  understandings  or  agreements,
         whether oral or in writing. Any and all agreements
                                       -9-
<PAGE>
         between the parties  hereto,  whether oral or in writing,  prior to the
         date hereof shall be deemed null and void.

                  f. Parties.  This Agreement shall be binding upon and inure to
         the  benefit  to  the  parties  hereto,   their  officers,   directors,
         shareholders,  successors, legal representatives,  heirs and successors
         and assigns, and no other person shall have or be construed to have any
         legal or equitable right, remedy or claim under or in respect of, or by
         virtue of, this Agreement or any provision herein contained.

                  g.  Mediation;  Arbitration.  If a  dispute  arises  out of or
         relates to this Agreement,  or the breach  thereof,  and if the dispute
         cannot be settled through  negotiation,  the parties agree first to try
         in good faith to settle the dispute by  mediation  administered  by the
         American Arbitration  Association under its Commercial Mediation Rules.
         If the dispute cannot be settled through negotiation or mediation,  the
         Parties agree to submit the dispute to arbitration  administered by the
         American  Arbitration  Association  under  its  Commercial  Arbitration
         Rules, and judgment on the award rendered by the  arbitrator(s)  may be
         entered in any court having  jurisdiction  thereof.  Venue for all such
         mediation and/or  arbitration  proceedings shall be in Maricopa County,
         Arizona.

                  h.  Attorney's  Fees. The  prevailing  party in any litigation
         hereunder   shall  be  entitled  to  the  recovery  of  its  reasonable
         attorneys' fees and costs from the other party.  Upon Employee's  entry
         into this  Agreement,  the Company shall  undertake to bear  Employee's
         attorney's fees incurred in the  negotiation of this  Agreement,  in an
         amount not to exceed $4,000.00.

                  i. Counterparts.  This Agreement may be executed in two (2) or
         more counterparts, each of which shall be deemed an original and all of
         which, together, shall constitute one and the same instrument.

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

"COMPANY"                               "EMPLOYEE"

PREMIUM CIGARS INTERNATIONAL, LTD.



By:     /s/ Greg Lambrecht                   /s/ John Greenwell
   -------------------------------      ----------------------------------------
     Its: Secretary                     John E. Greenwell
                                                       -10-