Document:

Exhibit
10.26

 

AMENDED
AND RESTATED

EXECUTIVE
EMPLOYMENT AGREEMENT

 

THIS AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (this
“Agreement”) is made this 17th day of June, 2003, between Todhunter
International, Inc., a Delaware corporation (“Employer”), and D. Chris Mitchell
(“Executive”).

 

The original Executive Employment Agreement between
Employer and Executive was entered into as of July 15, 1999.  Employer and Executive desire to amend and
restate the Executive Employment Agreement in accordance with the terms and
conditions set forth in this Agreement.

 

The
parties hereto, in consideration of the mutual covenants contained herein,
agree upon the following terms of employment of Executive by Employer:

 

1.             Employment and
Term.  Subject to the terms and
conditions herein, Employer hereby employs Executive and Executive hereby
accepts employment for a term commencing on the date hereof and ending at the
close of business on December 31, 2008 (the “Employment Period”), unless
sooner terminated as hereinafter provided. 
The Employment Period shall continue automatically for additional
periods of one (1) year each under the same terms and conditions unless either
party shall have given written notice of termination at least ninety (90) days
before the end of the then current term. 
All references herein to the Employment Period shall refer to both the
initial Employment Period and any such successive Employment Periods.

 

2.             Duties.  Executive shall serve as Senior Vice
President - Sales of the Employer.  Executive
shall perform the duties generally of a Senior Vice President - Sales for
Employer and shall have such specific responsibilities, duties and authorities
as shall from time to time be assigned by the Chief Executive Officer or the
Board of Directors of Employer (“Board of Directors”).   Executive shall devote substantially all of
his working time and efforts to the business and affairs of Employer and its
subsidiaries.  Executive shall not be
required to relocate his office or residence outside of Palm Beach County,
Florida.

 

3.             Compensation.

 

A.            Salary.  For all duties to be performed by Executive
in any capacity hereunder, Executive shall be paid an annual salary (the “Base
Salary”) at a rate determined by the Board of Directors of not less than $255,308
per year payable monthly or in such more frequent installments as Employer
customarily pays its other executives. 
The Board of Directors may authorize upward compensation adjustments by
way of salary, bonus or otherwise, as it deems appropriate during the
Employment Period or any extension hereof. 
The Base Salary, as amended and determined herein from time to time,
shall constitute “Base Salary” for purposes of this Agreement.

 

B.            Bonus.  In addition to the Base Salary, Employer
shall pay Executive within sixty (60) days after the end of each fiscal year
(including any partial fiscal year) of Employer which occurs during the
Employment Period a cash bonus (the “Base Bonus”) in an amount determined by
the Board of Directors but in no event less than $38,115 per year (prorated for
any partial fiscal year).  The amount of
the bonus may exceed such amount to the extent earned in accordance with
performance targets, measurements and such other criteria as shall be established
for such fiscal year by the Board of Directors.  The Base Bonus, as

 

 

amended and determined
herein from time to time, shall constitute “Base Bonus” for purposes of this
Agreement.  If this Agreement is terminated prior to the
end of a fiscal year for any reason, except as set forth in 4(C) or 4(E)(4),
the amount of bonus shall be prorated for the number of days elapsed in such
fiscal year prior to the date of termination.

 

C.            Vacation.  Executive shall be entitled each year to a
reasonable period of paid vacation.

 

D.            Fringe Benefits.  Executive shall be entitled to participate
in or receive benefits under any employee benefit plan, program or arrangement
made available by Employer or its subsidiaries in the future to its executives
and key management employees, subject to and on a basis consistent with the
terms, conditions and overall administration of such plans and
arrangements.  If and to the extent that any benefit is not or cannot be paid or
provided under any plan, program, or arrangement of Employer, then Employer
will itself pay or provide for the payment to Executive and Executive’s
dependents and beneficiaries, of such benefits along with, in the case of any
benefit described in this Section 3(D) which is subject to tax because it
is not or cannot be paid or provided under any such plan, program or
arrangement of Employer, an additional amount such that after payment by
Executive and Executive’s dependents or beneficiaries, as the case may be, of
all taxes so imposed, the recipient retains an amount equal to such taxes.  Notwithstanding the foregoing, and subject
to Section 4(G) and 5(B) hereof, for purposes of determining the period of
continuation coverage to which Executive or any of Executive’s dependents is
entitled to pursuant to Section 4980B of the Internal Revenue Code of
1986, as amended, under Employer’s medical, dental, and other group health
plans, or successor plans, Executive’s “qualifying event” shall be his Date of
Termination and Executive shall be considered to have remained actively
employed on a full-time basis through that date.

 

E.             Expenses.  It is understood that Executive will from
time to time incur reasonable expenses in conjunction with his employment.  Employer will promptly reimburse him for any
such expenses of which he shall present a signed itemized written account
setting forth the amount and nature of each such expenditure, and in addition,
with respect to travel or entertainment, the business purpose, the nature of
discussions and other person or persons involved and such other information as Employer
may reasonably require; provided that such expenses are incurred and accounted
for in accordance with such other policies and procedures then established by
Employer.

 

F.             D&O Coverage.  If immediately prior to Executive’s Date of
Termination Executive was covered as an insured under Employer’s D&O
Insurance, Employer will be obligated to continue Executive’s coverage under
Employer’s D&O Insurance or provide Executive with similar coverage, in
either case, on substantially the same terms and conditions until the third
anniversary of the date of Executive’s Date of Termination.

 

4.             Termination.  Unless otherwise agreed to in writing by
Employer and Executive, Executive’s employment hereunder may be terminated
under the following circumstances, in addition to terminations pursuant to
Section 5 hereof:

 

A.            Death.  Executive’s death.

 

B.            Disability.  If, as a result of Executive’s incapacity
due to physical or mental illness (such incapacity being determined by the
Board of Directors in its sole reasonable discretion), Executive shall have
been absent from his full-time duties as described hereunder

 

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for the entire period of
six (6) consecutive months, Employer may terminate Executive’s employment hereunder.

 

C.            Cause.

 

i.              Employer may
terminate Executive’s employment hereunder for Cause.  For purposes of this Agreement, “Cause” shall mean that (a)
Executive is convicted of a felony which, in the sole determination of the
Board of Directors, would have a material adverse effect on Executive’s ability
to perform his duties hereunder or on the business or reputation of Employer;
(b) Executive has exhibited gross misconduct resulting in material harm to
Employer, its business or reputation; (c) Executive has willfully
misappropriated Employer assets or has otherwise willfully defrauded Employer,
including without limitation by fraud, theft, embezzlement, or breach of a
fiduciary duty involving personal profit; (d) Executive has intentionally
failed to perform his duties hereunder; or (e) Executive has breached any
provision of this Agreement.  For the
purposes of this Section 4(C)(i), no act or failure to act on Executive’s
part shall be considered “willful” unless done, or omitted to be done, by him
not in good faith and without reasonable belief that his action or omission was
in the best interests of Employer.

 

ii.             Notwithstanding the
foregoing, any termination of Executive shall not be considered a termination
for Cause pursuant to this Section 4, and shall be considered a
termination Without Cause pursuant to Section 4(D) hereof, if such
termination is effected without:  (a)
reasonable notice to Executive setting forth the reasons for Employer’s
intention to terminate for Cause; (b) an opportunity for Executive, together
with his counsel, to be heard before the Board of Directors; and (c) delivery
to Executive of a Notice of Termination as provided for in Section 4(I)
hereof from the Board of Directors finding that in the good faith opinion of
the Board of Directors, Executive was guilty of conduct set forth above in the
preceding sentence, and specifying the particulars thereof in detail.

 

D.            Without Cause.  Any termination of Executive by Employer
(including any action which is deemed a termination of Executive pursuant to
Section 4(F) hereof), other than a termination pursuant to Sections 1 and
4(A)-4(C) hereof, shall be deemed a termination Without Cause.

 

E.             Termination by
Executive.  Executive may terminate
this Agreement (1) due to Executive’s retirement, provided that Executive
provides Employer with thirty (30) days written notice, pursuant to
Section 4(I), prior to the effective date of such retirement, as shall be
stated in such notice; (2) for reasons
set forth in Section 4(F)(iii), (iv) and (v), provided, however, that
Executive provides Employer with ten (10) days written notice pursuant to
Section 4(I); (3) as provided in Section 1; and (4) for any
reason other than Executive’s retirement, provided that Executive provides
Employer with thirty (30) days written notice prior to the effective date of
such termination, as shall be stated in such notice.

 

F.             Other Events of
Termination.  The following
circumstances shall specifically be deemed a termination Without Cause of
Executive’s employment by Employer:

 

i.              a vote by the Board
of Directors to terminate Executive Without Cause, as defined in
Section 4(D) hereof;

 

ii.             any termination of
Executive’s employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 4(I) hereof;

 

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iii.            a breach by Employer
of this Agreement, and a subsequent election by Executive to terminate this
Agreement pursuant to Section 4(E) above;

 

iv.            the performance of any
other act by Employer which is designed to prevent and does prevent Executive
from properly performing the authorities, duties and responsibilities of his
employment hereunder; or

 

v.             Executive voluntarily
terminates his employment for “Good Reason.” 
Good Reason shall mean (a) any material diminution by Executive’s
supervisor or the Board of Directors, as the case may be, of Executive’s
position, duties, or responsibilities; (b) any reduction in Executive’s salary
or Executive’s benefits described in Section 3(D), other than a reduction
affecting all executive officers; or (c) the relocation of Employer’s
headquarters outside of Palm Beach County, Florida.

 

G.            Payments if Without
Cause or for Good Reason.  If
Executive’s employment is terminated for any reason pursuant to
Section 4(D) or 4(E)(2) hereof, Employer shall continue to pay Executive
his then Base Salary and then Base Bonus in accordance with and at such times
specified in Sections 3(A) and 3(B) and provide the benefits pursuant to
Section 3(D) for the greater of: (1) one (1) year from the Date of
Termination, or (2) the balance of the Employment Period (the then Base Bonus
to be prorated for any partial fiscal year). 
In addition, the vesting schedules, if any, under all stock options held
by Executive shall continue to run to the maximum extent permitted by
applicable law.

 

H.            Payments Under
Other Terminations.  If Executive’s
employment is terminated pursuant to Sections 1, 4(A), 4(B), 4(C), 4(E)(1) or
4(E)(4) hereof, on and after the Date of Termination Employer shall no longer
be obligated to pay Executive any amounts payable hereunder for such period,
whether in the form of Base Salary, Base Bonus or otherwise, and Executive
shall have no right to compensation or other benefits hereunder for any such
period.  Notwithstanding the foregoing,
Employer shall be obligated to pay to Executive all amounts payable hereunder
and otherwise, through and including the Date of Termination, whether such
amounts were payable prior to the date of termination or thereafter, and
Executive shall be entitled to receive any extension of benefits beyond the
Date of Termination, provided that (1) such benefits were received by Executive
prior to the Date of Termination and (2) such extension is customarily offered
by Employer to its employees or is otherwise required by applicable law.

 

I.              Notice of
Termination.  Any termination of
Executive’s employment by Employer or by Executive (other than termination
pursuant to Section 4(A) hereof) shall be communicated by written Notice
of Termination to the other party hereto. 
For purposes of this Agreement, a “Notice of Termination” shall mean a
notice which shall (1) indicate the specific termination provision in this
Agreement relied upon; (2) set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of Executive’s employment under the
provision so indicated; and (3) contain any other information required by this
Agreement.

 

J.             Effective Date of
Termination.  For purposes of
Section 3(F) and this Section 4, “Date of Termination” shall mean:
(1) if Executive’s employment is terminated by providing written notice of
termination pursuant to Section 1 hereof, as of December 31, 2008, or
the December 31 immediately subsequent to the provision of such written
notice of termination if such notice is provided after December 31, 2008;
(2) if Executive’s employment is terminated by his death, the date of his
death; (3) if Executive’s employment is terminated pursuant to
Section 4(B) hereof, the termination date stated in the written notice
sent by

 

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Employer after the
expiration of six (6) consecutive months of Executive’s incapacity due to
physical or mental illness, as set forth in Section 4(B) hereof (provided
that Executive shall not have returned to the performance of his duties on a
full-time basis during such six (6) month period); (4) if Executive’s
employment is terminated pursuant to Sections 4(C) or 4(D) hereof, the
effective date of termination specified in the Notice of Termination is
communicated to Executive pursuant to Section 4(I) hereof; (5) if
Executive’s employment is terminated pursuant to Section 4(E) hereof, the
effective termination date stated in the written notice received by Employer; or
(6) if deemed terminated pursuant to Section 4(F) hereof, the date of such
action which is deemed a termination of Executive by Employer.

 

5.             Termination of
Employment Upon Change of Control.

 

A.            Certain
Definitions.

 

i.              “Change of Control”
shall mean:

 

(a)           The acquisition by any
person, entity or “group” required to file a Schedule 13D or
Schedule 14D-1 promulgated under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) (excluding, for this purpose, any of the following
that acquires beneficial ownership of voting securities of Employer, including
shares acquired pursuant to the exercise of options or warrants, or conversion
of preferred stock outstanding as of the date hereof: (i) CL Financial, Ltd.,
Angostura Ltd., or any of their affiliates; (ii) Employer, its affiliates or
subsidiaries; (iii) V&S Vin & Spirit AB, its affiliates or
subsidiaries, solely in connection with a transaction with Employer, its
affiliates or subsidiaries approved by the Board of Directors; or (iv) any
employee benefit plan of Employer, or its affiliates or subsidiaries), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of over 40% (in one or more transactions, in the aggregate) of
either the then outstanding shares of common stock or the combined voting power
of Employer’s then outstanding voting securities entitled to vote generally in
the election of directors; or

 

(b)           An election or
appointment to the Board of Directors by virtue of which the individuals who
immediately prior thereto constituted the Board of Directors (the “Incumbent
Board”) no longer constitute at least a majority of the Board of Directors
(other than an election or appointment of a director or directors precipitated
by CL Financial, Ltd., Angostura Ltd., V&S Vin & Spirit AB, or any of
their affiliates, or by the Board of Directors if at that time at least a
majority are individuals who are directors on the date hereof), provided that
any person who becomes a director subsequent to the date hereof whose election,
or nomination for election by Employer’s stockholders, was approved by a vote
of at least a majority of the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the election of the
Directors of Employer, as such terms are used in Rule 14a-1 promulgated under
the Exchange Act) shall be, for purposes of this Agreement, considered as
though such person were a member of the Incumbent Board; or

 

(c)           Approval by the
stockholders of Employer of: (i) a reorganization, merger or consolidation by
reason of which persons who were the stockholders of Employer immediately prior
to such reorganization, merger or consolidation do not, immediately thereafter,
own more than fifty percent (50%) of the combined voting power entitled to vote
generally in the election of directors of the reorganized, merged or
consolidated company’s then outstanding voting securities; or (ii) a liquidation
or dissolution of Employer or the sale of all or substantially all of the
assets of Employer, whether such assets are held

 

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directly or indirectly (excluding the currently proposed joint
ventures with affiliates of CL Financial, Ltd. and/or V&S Vin & Spirit
AB, if such transactions constitute a sale of substantially all of the assets
of Employer).

 

ii.             “Date of
Termination,” for the purposes of this Section 5, means the date of
receipt by Executive of a notice of termination of employment from Employer or
any later date specified therein, or the date Executive delivers a letter of
resignation to Employer.

 

iii.            The “Effective Date”
shall be the date on which a Change of Control occurs.  Anything in this Agreement to the contrary
notwithstanding, if Executive’s employment with Employer is terminated prior to
the date on which a Change of Control occurs, and it is reasonably demonstrated
that such termination (a) was at the request of a third party who has taken
steps reasonably calculated to effect a Change of Control or (b) otherwise
arose in connection with or anticipation of a Change of Control, then for all
purposes of this Agreement the “Effective Date” shall mean the date immediately
prior to the date of such termination.

 

B.            Obligations of
Employer upon Termination.  If
within one (1) year following the Effective Date of a Change of Control,
Executive’s employment is deemed terminated Without Cause within the two-year
period immediately preceding the end of the Employment Period, then in addition
to any amount payable under Section 4(G), Employer shall pay to Executive
in a lump sum in cash within thirty (30) days after the Date of Termination to
the extent not theretofore paid, an amount equal to (i) two times Executive’s
then Base Salary, two times the then Base Bonus, and the benefits provided
pursuant to Section 3(D), less (ii) the amount payable under
Section 4(G) (except that Executive, at his option, may choose to continue
to have he and his family covered, to the extent they are then covered, by
Employer’s health plan in lieu of receiving a lump sum payment for that
benefit, and Employer shall use reasonable efforts to cooperate in such event);
provided, however, that if the amount calculated under this Section 5(B)
is a negative number, Executive shall not be deemed to owe that amount to
Employer.

 

C.            Non-exclusivity of
Rights.  Nothing in this Agreement
shall prevent or limit Executive’s continuing or future participation in any
benefit, bonus, incentive or other plans, programs, policies or practices
provided by Employer or its subsidiaries and for which Executive may qualify,
nor shall anything herein limit or otherwise affect such rights as Executive
may have under any stock option or other agreements with Employer or any of its
subsidiaries.  Amounts which are vested
benefits or which Executive is otherwise entitled to receive under any plan,
policy, practice or program of Employer or any of its subsidiaries at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program; provided that the vesting schedules, if any,
under all stock options held by Executive shall continue to run to the maximum
extent permitted by applicable law.

 

D.            Interest.  Without limiting the rights of Executive at
law or in equity, if Employer fails to make any payment or provide any benefit
required to be made or provided hereunder on a timely basis, Employer will pay
interest on the amount or value thereof at any annualized rate of interest
equal to the so-called composite “prime rate” as quoted from time to time
during the relevant period in the Eastern Edition of The Wall Street Journal.  Such interest will be payable as it accrues
on demand.  Any change in such prime
rate will be effective on and as of the date of such change.

 

6

 

6.             Confidentiality.

 

A.            In the course of his
employment, Employer or any of its subsidiaries may disclose or make known to
Executive, and Executive may be given access to or may become acquainted with,
certain information, trade secrets or both, including but not limited to
confidential information and trade secrets regarding tapes, computer programs,
designs, skills, procedures, formulations, methods, documentation, drawings,
facilities, customers, policies, marketing, pricing, customer lists and leads,
and other information and know-how, all relating to or useful in Employer’s
business or the business of its subsidiaries and/or affiliates (collectively,
the “Information”), and which Employer considers proprietary, desires to
maintain confidential and is not in the public domain.  During the Employment Period and at all
times thereafter, Executive shall not in any manner, either directly or indirectly,
divulge, disclose or communicate to any person or firm, except to or for
Employer’s benefit as directed by Employer or except as required by applicable
law or court process (but only after giving Employer written notice so that
Employer may attempt to obtain a protective order), any of the Information
which he may have acquired in the course of or as an incident to his employment
by Employer, the parties agreeing that such information affects the successful
and effective conduct of Employer’s business and its goodwill, and that any
breach of the terms of this Section 6 is a material breach of this
Agreement.

 

B.            All equipment,
documents, memoranda, reports, records, files, materials, samples, books,
correspondence, lists, other written and graphic records, and the like
(collectively, the “Materials”) affecting or relating to the business of
Employer or of its subsidiaries and/or affiliates, which Executive shall
prepare, use, construct, observe, possess or control shall be and remain
Employer’s sole property or in Employer’s exclusive custody, and must not be
removed from the premises of Employer except as directed by Employer’s Board of
Directors in writing.  Promptly upon
termination of the Agreement or Executive’s employment hereunder for any reason,
or otherwise upon request of the Chief Executive Officer of Employer, the
Information, the Materials and all copies thereof in the custody or control of
Executive shall be delivered to Employer.

 

7.             Restrictive
Covenant.

 

A.            During the Employment Period and, if
Executive is terminated for Cause or if Executive terminates his employment
pursuant to Sections 4(B), 4(E)(1) or 4(E)(4), for a period of two (2) years
thereafter, Executive will not, directly or indirectly:

 

i.              engage in any trade or business in any
capacity in the liquor industry, anywhere in the United States or such other
country or countries in which Employer actively engages in its trade or
business as of the Date of Termination (“Territory”);

 

ii.             become associated as a manager, supervisor,
employee, consultant, advisor, control shareholder (either individually or as
part of an affiliated group), or otherwise of any person, corporation or entity
engaging in any capacity in the liquor industry anywhere in the Territory;

 

iii.            call upon any client or clients of Employer
or any of its subsidiaries for the purpose of selling or soliciting for any
person, corporation or entity, other than any of Employer or its subsidiaries,
sales of any products, processes, or services in any capacity in the liquor
industry within the Territory;

 

7

 

iv.            divert, solicit or take away any such client
or clients of Employer or any of its subsidiaries for the purpose of selling
any products or services in any capacity in the liquor industry; and service
any contracts or accounts relating to any products or services in any capacity
in the liquor industry for any person, corporation or entity other than
Employer or any of its subsidiaries; or

 

v.             induce, influence, combine or conspire with,
or attempt to induce, influence, combine or conspire with, any of the officers
or employees of Employer or any of its subsidiaries to terminate his or her
employment with or to compete against Employer or any of its subsidiaries in
any capacity in the liquor industry.

 

B.            During the Employment Period and, if
Executive’s employment hereunder is terminated pursuant to Sections 4(D),
4(E)(2) or 4(F), for a period thereafter that is the lesser of (a) any
additional periods with respect to which Executive continues to receive Base
Salary, Base Bonus and the benefits described in Section 3(D) under this
Agreement (e.g., Sections 4(G)
and 5(B)), or (b) two (2) years after the Employment Period, Executive will
not, directly or indirectly:

 

i.              engage in any trade or business directly
competitive with that of any of Employer or any of its subsidiaries, anywhere
within the Territory;

 

ii.             become associated as a manager, supervisor,
employee, consultant, advisor, control shareholder (either individually or as
part of an affiliated group), or otherwise of any person, corporation or entity
engaging in any trade or business directly competitive with those of Employer
or any of its subsidiaries anywhere in the Territory;

 

iii.            call upon any client or clients of Employer
or any of its subsidiaries for the purpose of selling or soliciting for any
person, corporation or entity, other than any of Employer or its subsidiaries,
sales of any products, processes, or services directly competitive with any
trade or business of Employer or any of its subsidiaries within the Territory;

 

iv.            divert, solicit or take away any such client
or clients of Employer or any of its subsidiaries for the purpose of selling
any products or services directly competitive with any trade or business of
Employer or any of its subsidiaries; and service any contracts or accounts
relating to any products or services directly competitive with any trade or
business of Employer or any of its subsidiaries for any person, corporation or
entity other than Employer or any of its subsidiaries; or

 

v.             induce, influence, combine or conspire with,
or attempt to induce, influence, combine or conspire with, any of the officers
or employees of Employer or any of its subsidiaries to terminate his or her
employment with or to directly compete against any trade or business of
Employer or any of its subsidiaries.

 

C.            During the Employment Period and, if
Executive’s employment hereunder is terminated effective as of the end of the
Employment Period pursuant to Section 1, for a period of one (1) year
thereafter, Executive will not, directly or indirectly:

 

i.              engage in any trade or business directly
competitive with the production, importing or marketing of premium branded rum
by Employer or any of its subsidiaries, anywhere within the Territory;

 

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ii.             become associated as a manager, supervisor,
employee, consultant, advisor, control shareholder (either individually or as
part of an affiliated group), or otherwise of any person, corporation or entity
engaging in any trade or business directly competitive with the production,
importing or marketing of premium branded rum by Employer or any of its
subsidiaries anywhere in the Territory;

 

iii.            call upon any client or clients of Employer
or any of its subsidiaries for the purpose of selling or soliciting for any
person, corporation or entity, other than any of Employer or its subsidiaries,
sales of any products, processes, or services directly competitive with the
production, importing or marketing of premium branded rum by Employer or any of
its subsidiaries within the Territory;

 

iv.            divert, solicit or take away any such client
or clients of Employer or any of its subsidiaries for the purpose of selling
any products or services directly competitive with the production, importing or
marketing of premium branded rum by Employer or any of its subsidiaries; and
service any contracts or accounts relating to any products or services directly
competitive with the production, importing or marketing of premium branded rum
by Employer or any of its subsidiaries for any person, corporation or entity
other than Employer or any of its subsidiaries; or

 

v.             induce, influence, combine or conspire with,
or attempt to induce, influence, combine or conspire with, any of the officers
or employees of Employer or any of its subsidiaries to terminate his or her
employment with or to directly compete against the production, importing or
marketing of premium branded rum by Employer or any of its subsidiaries.

 

D.            Notwithstanding
anything to the contrary in this Agreement, Executive shall not be precluded from owning
less than five percent (5%) of the outstanding capital stock of any company
whose stock is traded on an established stock exchange or quoted on
Nasdaq.  Should any of the time periods
or the geographic area set forth in this Section 7 be held to be
unreasonable by any court of competent subject matter jurisdiction, the parties
hereto agree to petition such court to reduce the time period or geographic
area to the maximum permitted by governing law.

 

8.             Assignments.  No party shall assign his or its rights or
obligations under this Agreement without the prior written consent of the other
party to this Agreement.

 

9.             Amendments.  The provisions of this Agreement may not be
amended, supplemented, waived or changed orally, but only by a writing signed
by the party as to whom enforcement of any such amendment, supplement, waiver
or modification is sought and making specific reference to this Agreement.

 

10.           Remedies.  If a party commits a material breach, or is
about to commit a material breach, of any of the provisions of this Agreement,
the other party shall have the right to have the provisions of this Agreement
specifically enforced by any court having equity jurisdiction without being
required to post bond or other security and without having to prove the
inadequacy of the available remedies at law, it being acknowledged and agreed
that any such breach or threatened breach will cause irreparable injury to the
non-breaching party and that the money damages will not provide an adequate
remedy to the non-breaching party.  In
addition, the non-breaching party may take all such other actions and remedies
available to it under law

 

9

 

or in equity and shall be
entitled to such damages as it can show it has sustained, by reason of such
breach.

 

11.           Surrender of Books
and Records.  Executive acknowledges
that all lists, books, records, literature, products and any other materials
owned by Employer or its subsidiaries or used by them in connection with the
conduct of their business, shall at all times remain the property of Employer
and its subsidiaries and that upon termination of employment hereunder, irrespective
of the time, manner or cause of said termination, Executive will surrender to
Employer and its subsidiaries all such lists, books, records, literature,
products and other materials.

 

12.           Severability.  If any provision of this Agreement or any other
agreement entered into pursuant to this Agreement is contrary to, prohibited by
or deemed invalid under applicable law or regulation, such provision shall be
inapplicable and deemed omitted to the extent so contrary, prohibited or
invalid, but the remainder of this Agreement shall not be invalidated thereby
and shall be given full force and effect so far as possible.  If any provision of this Agreement may be
construed in two or more ways, one of which would render the provision invalid
or otherwise voidable or unenforceable and another of which would render the
provision valid and enforceable, such provision shall have the meaning which
renders it valid and enforceable.

 

13.           Notices.  All notices, requests, consents and other
communications required or permitted under this Agreement shall be in writing
(including electronic transmission) and shall be (as elected by the person
giving such notice) hand delivered by messenger or courier service,
electronically transmitted, or mailed (airmail if international) by registered
or certified mail (postage prepaid), return receipt requested, addressed to:

 

	
  If
  to Employer:

  	
   

  	
  With
  a copy to:

  
	
   

  	
   

  	
   

  
	
  Todhunter
  International, Inc.

  	
   

  	
  Gunster,
  Yoakley & Stewart, P.A.

  
	
  222
  Lakeview Avenue

  	
   

  	
  777
  South Flagler Drive

  
	
  Suite
  1500

  	
   

  	
  Suite
  500 East

  
	
  West
  Palm Beach, Florida 33401

  	
   

  	
  West
  Palm Beach, Florida 33401

  
	
  (561)
  655-8977

  	
   

  	
  (561)
  650-0553

  
	
  Fax:
  (561) 655-9718

  	
   

  	
  Fax:
  (561) 655-5677

  
	
  Attn:
  Jay S. Maltby

  	
   

  	
  Attn:
  Michael V. Mitrione, Esq.

  

 

	
  If
  to Employee:

  
	
   

  
	
  Chris Mitchell

  
	
   

  
	
   

  
	
  Telephone:

  	
   

  
	
  Fax:

  	
   

  
			

 

or
to such other address as any party may designate by notice complying with the
terms of this Section.  Each such notice
shall be deemed delivered (a) on the date delivered if by personal
delivery; (b) on the date of transmission with confirmed answer back if by
electronic transmission; and (c) on the date upon which the return receipt
is signed or delivery is refused

 

10

 

or
the notice is designated by the postal authorities as not deliverable, as the
case may be, if mailed.

 

14.           Binding Effect.  All of the terms and provisions of this
Agreement shall be binding upon, inure to the benefit of, and be enforceable by
the parties and their respective administrators, executors, legal
representatives, heirs, successors and permitted assigns, whether so expressed
or not.

 

15.           Waiver.  The failure or delay of any party at any
time to require performance by another party of any provision of this
Agreement, even if known, shall not affect the right of such party to require
performance of that provision or to exercise any right, power or remedy under
this Agreement.  Any waiver by any party
of any breach of any provision of this Agreement should not be construed as a waiver
of any continuing or succeeding breach of such provision, a waiver of the
provision itself, or a waiver of any right, power or remedy under this
Agreement.  No notice to or demand on
any party in any circumstance shall, of itself, entitle such party to any other
or further notice or demand in similar or other circumstances.

 

16.           Governing Law.  This Agreement and all transactions
contemplated by this Agreement shall be governed by, and construed and enforced
in accordance with, the laws of the State of Florida.

 

17.           Jurisdiction and
Venue.  The parties acknowledge that
a substantial portion of the negotiations, anticipated performance and
execution of this Agreement occurred or shall occur in Palm Beach County,
Florida.  Any civil action or legal
proceeding arising out of or relating to this Agreement shall be brought in the
courts of record of the State of Florida in Palm Beach County or the United
States District Court, Southern District of Florida, West Palm Beach
Division.  Each party consents to the
jurisdiction of such court in any such civil action or legal proceeding and
waives any objection to the laying of venue of any such civil action or legal
proceeding in such court.  Service of
any court paper may be effected on such party by mail, as provided in this
Agreement, or in such other manner as may be provided under applicable laws,
rules of procedure or local rules.

 

18.           Enforcement Costs.  If any civil action, arbitration or other
legal proceeding is brought for the enforcement of this Agreement, or because
of an alleged dispute, breach, default or misrepresentation in connection with
any provision of this Agreement, the successful or prevailing party or parties
shall be entitled to recover reasonable attorneys’ fees, sales and use taxes,
court costs and all expenses even if not taxable as court costs (including,
without limitation, all such fees, taxes, costs and expenses incident to
arbitration, appellate, bankruptcy and post-judgment proceedings), incurred in
that civil action, arbitration or legal proceeding, in addition to any other
relief to which such party or parties may be entitled.  Attorneys’ fees shall include, without
limitation, paralegal fees, investigative fees, administrative costs, sales and
use taxes and all other charges billed by the attorney to the prevailing party.

 

19.           Entire Agreement.  This Agreement represents the entire
understanding and agreement between the parties with respect to the subject
matter of this Agreement, and supersedes all other negotiations, understandings
and representations (if any) made by and between such parties (including,
without limitation, any and all prior employment agreements and all amendments
thereto between Executive and Employer).

 

20.           No Mitigation
Obligation.  Employer hereby
acknowledges that it will be difficult and may be impossible for Executive to
find reasonably comparable employment following the

 

11

 

Date of Termination.  Accordingly, the payment of the severance
compensation by Employer to Executive in accordance with the terms of this
Agreement is hereby acknowledged by Employer to be reasonable and Executive
will not be required to mitigate the amount of any payment provided for in this
Agreement by seeking other employment or otherwise, nor will any profits,
income, earnings or other benefits from any source whatsoever create any
mitigation, offset, reduction or any other obligation on the part of Executive
hereunder, or otherwise.

 

21.           Survival.  The provisions of Sections 3B and 4 through
21 shall survive any termination or expiration of this Agreement.

 

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

 

 

	
   

  	
  /s/

  	
  Chris
  Mitchell

  	
   

  
	
   

  	
   

  	
  Chris
  Mitchell, Executive

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TODHUNTER
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:/s/

  	
  Jay
  S. Maltby

  	
   

  
	
   

  	
   

  	
  Jay S Maltby

  
	
   

  	
   

  	
  Chief Executive Officer

  
						

 

12Exhibit 10.27

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) is made this
17th day of June, 2003, between Todhunter International, Inc., a Delaware
corporation (“Employer”), and Ousik Yu (“Executive”).

 

The parties hereto, in consideration of the mutual covenants contained
herein, agree upon the following terms of employment of Executive by Employer:

 

1.             Employment and
Term.  Subject to the terms and
conditions herein, Employer hereby employs Executive and Executive hereby
accepts employment for a term commencing on the date hereof and ending at the
close of business on December 31, 2007 (the “Employment Period”), unless
sooner terminated as hereinafter provided. 
The Employment Period shall continue automatically for additional
periods of one (1) year each under the same terms and conditions unless either
party shall have given written notice of termination at least ninety (90) days
before the end of the then current term. 
All references herein to the Employment Period shall refer to both the
initial Employment Period and any such successive Employment Periods.

 

2.             Duties.  Executive shall serve as Senior Vice
President – Beverage Division of the Employer. 
Executive shall perform the duties generally of a Senior Vice President
– Beverage Division for Employer and shall have such specific responsibilities,
duties and authorities as shall from time to time be assigned by the Chief
Executive Officer or the Board of Directors of Employer (“Board of Directors”).   Executive shall devote substantially all of
his working time and efforts to the business and affairs of Employer and its
subsidiaries.  Executive shall not be
required to relocate his office or residence outside of Polk or Orange County,
Florida.

 

3.             Compensation.

 

A.            Salary.  For all duties to be performed by Executive
in any capacity hereunder, Executive shall be paid an annual salary at a rate
determined by the Board of Directors of not less than $241,980 per year (the
“Base Salary”) payable monthly or in such more frequent installments as
Employer customarily pays its other executives.  The Board of Directors may authorize upward compensation
adjustments by way of salary, bonus or otherwise, as it deems appropriate
during the Employment Period or any extension hereof.  The Base Salary, as amended and determined herein from time to
time, shall constitute “Base Salary” for purposes of this Agreement.

 

B.            Bonus.  In addition to the Base Salary, Employer
shall pay Executive within sixty (60) days after the end of each fiscal year
(including any partial fiscal year) of Employer which occurs during the
Employment Period a cash bonus (the “Base Bonus”) in an amount determined by
the Board of Directors but in no event less than $38,115 per year (prorated for
any partial fiscal year).  The amount of
the bonus may exceed such amount to the extent earned in accordance with
performance targets, measurements and such other criteria as shall be
established for such fiscal year by the Board of Directors.  The Base Bonus, as amended and determined
herein from time to time, shall constitute “Base Bonus” for purposes of this
Agreement.  If this Agreement is terminated prior to the end of a fiscal year for
any reason, except as set forth in 4(C) or 4(E)(4), the amount of bonus shall be
prorated for the number of days elapsed in such fiscal year prior to the date
of termination.

 

 

C.            Vacation.  Executive shall be entitled each year to a
reasonable period of paid vacation.

 

D.            Fringe Benefits.  Executive shall be entitled to participate
in or receive benefits under any employee benefit plan, program or arrangement
made available by Employer or its subsidiaries in the future to its executives
and key management employees, subject to and on a basis consistent with the
terms, conditions and overall administration of such plans and
arrangements.  If and to the extent that any benefit is not or cannot be paid or
provided under any plan, program, or arrangement of Employer, then Employer
will itself pay or provide for the payment to Executive and Executive’s
dependents and beneficiaries, of such benefits along with, in the case of any
benefit described in this Section 3(D) which is subject to tax because it
is not or cannot be paid or provided under any such plan, program or
arrangement of Employer, an additional amount such that after payment by
Executive and Executive’s dependents or beneficiaries, as the case may be, of
all taxes so imposed, the recipient retains an amount equal to such taxes.  Notwithstanding the foregoing, and subject
to Section 4(G) and 5(B) hereof, for purposes of determining the period of
continuation coverage to which Executive or any of Executive’s dependents is
entitled to pursuant to Section 4980B of the Internal Revenue Code of
1986, as amended, under Employer’s medical, dental, and other group health
plans, or successor plans, Executive’s “qualifying event” shall be his Date of
Termination and Executive shall be considered to have remained actively
employed on a full-time basis through that date.

 

E.             Expenses.  It is understood that Executive will from
time to time incur reasonable expenses in conjunction with his employment.  Employer will promptly reimburse him for any
such expenses of which he shall present a signed itemized written account
setting forth the amount and nature of each such expenditure, and in addition,
with respect to travel or entertainment, the business purpose, the nature of
discussions and other person or persons involved and such other information as
Employer may reasonably require; provided that such expenses are incurred and
accounted for in accordance with such other policies and procedures then
established by Employer.

 

F.             D&O Coverage.  If immediately prior to Executive’s Date of
Termination Executive was covered as an insured under Employer’s D&O
Insurance, Employer will be obligated to continue Executive’s coverage under
Employer’s D&O Insurance or provide Executive with similar coverage, in
either case, on substantially the same terms and conditions until the third
anniversary of the date of Executive’s Date of Termination.

 

4.             Termination.  Unless otherwise agreed to in writing by
Employer and Executive, Executive’s employment hereunder may be terminated
under the following circumstances, in addition to terminations pursuant to
Section 5 hereof:

 

A.            Death.  Executive’s death.

 

B.            Disability.  If, as a result of Executive’s incapacity
due to physical or mental illness (such incapacity being determined by the
Board of Directors in its sole reasonable discretion), Executive shall have
been absent from his full-time duties as described hereunder for the entire
period of six (6) consecutive months, Employer may terminate Executive’s
employment hereunder.

 

2

 

C.            Cause.

 

i.              Employer may
terminate Executive’s employment hereunder for Cause.  For purposes of this Agreement, “Cause” shall mean that (a)
Executive is convicted of a felony which, in the sole determination of the
Board of Directors, would have a material adverse effect on Executive’s ability
to perform his duties hereunder or on the business or reputation of Employer;
(b) Executive has exhibited gross misconduct resulting in material harm to
Employer, its business or reputation; (c) Executive has willfully
misappropriated Employer assets or has otherwise willfully defrauded Employer,
including without limitation by fraud, theft, embezzlement, or breach of a
fiduciary duty involving personal profit; (d) Executive has intentionally
failed to perform his duties hereunder; or (e) Executive has breached any
provision of this Agreement.  For the
purposes of this Section 4(C)(i), no act or failure to act on Executive’s
part shall be considered “willful” unless done, or omitted to be done, by him
not in good faith and without reasonable belief that his action or omission was
in the best interests of Employer.

 

ii.             Notwithstanding the
foregoing, any termination of Executive shall not be considered a termination
for Cause pursuant to this Section 4, and shall be considered a
termination Without Cause pursuant to Section 4(D) hereof, if such
termination is effected without:  (a)
reasonable notice to Executive setting forth the reasons for Employer’s
intention to terminate for Cause; (b) an opportunity for Executive, together
with his counsel, to be heard before the Board of Directors; and (c) delivery
to Executive of a Notice of Termination as provided for in Section 4(I)
hereof from the Board of Directors finding that in the good faith opinion of
the Board of Directors, Executive was guilty of conduct set forth above in the
preceding sentence, and specifying the particulars thereof in detail.

 

D.            Without Cause.  Any termination of Executive by Employer
(including any action which is deemed a termination of Executive pursuant to
Section 4(F) hereof), other than a termination pursuant to Sections 1 and
4(A)-4(C) hereof, shall be deemed a termination Without Cause.

 

E.             Termination by
Executive.  Executive may terminate
this Agreement (1) due to Executive’s retirement; provided that Executive
provides Employer with thirty (30) days written notice, pursuant to
Section 4(I), prior to the effective date of such retirement, as shall be
stated in such notice; (2) for reasons
set forth in Section 4(F)(iii), (iv) and (v), provided, however, that
Executive provides Employer with ten (10) days written notice pursuant to
Section 4(I); (3) as provided in Section 1; and (4) for any other
reason other than Executive’s retirement, provided that Executive provides
Employer with thirty (30) days written notice prior to the effective date of
such termination, as shall be stated in such notice.

 

F.             Other Events of
Termination.  The following
circumstances shall specifically be deemed a termination Without Cause of
Executive’s employment by Employer:

 

i.              a vote by the Board
of Directors to terminate Executive Without Cause, as defined in
Section 4(D) hereof;

 

ii.             any termination of
Executive’s employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 4(I) hereof;

 

iii.            a breach by Employer
of this Agreement, and a subsequent election by Executive to terminate this
Agreement pursuant to Section 4(E) above;

 

3

 

iv.            the performance of any
other act by Employer which is designed to prevent and does prevent Executive
from properly performing the authorities, duties and responsibilities of his
employment hereunder; or

 

v.             Executive voluntarily
terminates his employment for “Good Reason.” 
Good Reason shall mean (a) any material diminution by Executive’s
supervisor or the Board of Directors, as the case may be, of Executive’s
position, duties, or responsibilities; (b) any reduction in Executive’s salary
or Executive’s benefits described in Section 3(D), other than a reduction
affecting all executive officers; or (c) the relocation of Employer’s
production facility outside of Polk County, Florida.

 

G.            Payments if Without
Cause or for Good Reason.  If
Executive’s employment is terminated for any reason pursuant to
Section 4(D) or 4(E)(2) hereof, Employer shall continue to pay Executive
his then Base Salary and then Base Bonus in accordance with and at such times
specified in Sections 3(A) and 3(B) and provide the benefits pursuant to
Section 3(D) for the greater of: (1) one (1) year from the Date of
Termination, or (2) the balance of the Employment Period (the then Base Bonus
to be prorated for any partial fiscal year). 
In addition, the vesting schedules, if any, under all stock options held
by Executive shall continue to run to the maximum extent permitted by
applicable law.

 

H.            Payments Under
Other Terminations.  If Executive’s
employment is terminated pursuant to Sections 1, 4(A), 4(B), 4(C), 4(E)(1) or
4(E)(4) hereof, on and after the Date of Termination Employer shall no longer
be obligated to pay Executive any amounts payable hereunder for such period,
whether in the form of Base Salary, Base Bonus or otherwise, and Executive
shall have no right to compensation or other benefits hereunder for any such
period.  Notwithstanding the foregoing,
Employer shall be obligated to pay to Executive all amounts payable hereunder
and otherwise, through and including the Date of Termination, whether such
amounts were payable prior to the date of termination or thereafter, and
Executive shall be entitled to receive any extension of benefits beyond the
Date of Termination, provided that (1) such benefits were received by Executive
prior to the Date of Termination and (2) such extension is customarily offered
by Employer to its employees or is otherwise required by applicable law.

 

I.              Notice of
Termination.  Any termination of
Executive’s employment by Employer or by Executive (other than termination
pursuant to Section 4(A) hereof) shall be communicated by written Notice
of Termination to the other party hereto.  For purposes of this Agreement, a “Notice of Termination” shall
mean a notice which shall (1) indicate the specific termination provision in
this Agreement relied upon; (2) set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of Executive’s
employment under the provision so indicated; and (3) contain any other
information required by this Agreement.

 

J.             Effective Date of
Termination.  For purposes of
Section 3(F) and this Section 4, “Date of Termination” shall mean:
(1) if Executive’s employment is terminated by providing written notice of
termination pursuant to Section 1 hereof, as of December 31, 2007, or
the December 31 immediately subsequent to the provision of such written
notice of termination if such notice is provided after December 31, 2007;
(2) if Executive’s employment is terminated by his death, the date of his
death; (3) if Executive’s employment is terminated pursuant to
Section 4(B) hereof, the termination date stated in the written notice
sent by Employer after the expiration of six (6) consecutive months of
Executive’s incapacity due to physical or mental illness, as set forth in
Section 4(B) hereof (provided that Executive shall not have returned to
the performance of his duties on a full-time basis during such six (6) month
period); (4) if Executive’s employment is terminated pursuant to Sections 4(C)
or 4(D) hereof,

 

4

 

the effective date of
termination specified in the Notice of Termination is communicated to Executive
pursuant to Section 4(I) hereof; (5) if Executive’s employment is
terminated pursuant to Section 4(E) hereof, the effective termination date
stated in the written notice received by Employer; or (6) if deemed terminated
pursuant to Section 4(F) hereof, the date of such action which is deemed a
termination of Executive by Employer.

 

5.             Termination of
Employment Upon Change of Control.

 

A.            Certain Definitions.

 

i.              “Change of Control”
shall mean:

 

(a)           The acquisition by any
person, entity or “group” required to file a Schedule 13D or
Schedule 14D-1 promulgated under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) (excluding, for this purpose, any of the following
that acquires beneficial ownership of voting securities of Employer, including
shares acquired pursuant to the exercise of options or warrants, or conversion
of preferred stock outstanding as of the date hereof: (i) CL Financial, Ltd.,
Angostura Ltd., or any of their affiliates; (ii) Employer, its affiliates or
subsidiaries; (iii) V&S Vin & Spirit AB, its affiliates or
subsidiaries, solely in connection with a transaction with Employer, its
affiliates or subsidiaries approved by the Board of Directors; or (iv) any
employee benefit plan of Employer, or its affiliates or subsidiaries), of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of over 40% (in one or more transactions, in the aggregate) of
either the then outstanding shares of common stock or the combined voting power
of Employer’s then outstanding voting securities entitled to vote generally in
the election of directors; or

 

(b)           An election or
appointment to the Board of Directors by virtue of which the individuals who
immediately prior thereto constituted the Board of Directors (the “Incumbent
Board”) no longer constitute at least a majority of the Board of Directors
(other than an election or appointment of a director or directors precipitated
by CL Financial, Ltd., Angostura Ltd., V&S Vin & Spirit AB, or any of
their affiliates, or by the Board of Directors if at that time at least a
majority are individuals who are directors on the date hereof), provided that
any person who becomes a director subsequent to the date hereof whose election,
or nomination for election by Employer’s stockholders, was approved by a vote
of at least a majority of the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the election of the
Directors of Employer, as such terms are used in Rule 14a-1 promulgated under
the Exchange Act) shall be, for purposes of this Agreement, considered as
though such person were a member of the Incumbent Board; or

 

(c)           Approval by the
stockholders of Employer of: (i) a reorganization, merger or consolidation by
reason of which persons who were the stockholders of Employer immediately prior
to such reorganization, merger or consolidation do not, immediately thereafter,
own more than fifty percent (50%) of the combined voting power entitled to vote
generally in the election of directors of the reorganized, merged or
consolidated company’s then outstanding voting securities; or (ii) a
liquidation or dissolution of Employer or the sale of all or substantially all
of the assets of Employer, whether such assets are held directly or indirectly (excluding the currently proposed joint
ventures with affiliates of CL Financial, Ltd. and/or V&S Vin & Spirit
AB, if such transactions constitute a sale of substantially all of the assets
of Employer).

 

5

 

ii.             “Date of
Termination,” for the purposes of this Section 5, means the date of
receipt by Executive of a notice of termination of employment from Employer or
any later date specified therein, or the date Executive delivers a letter of
resignation to Employer.

 

iii.            The “Effective Date”
shall be the date on which a Change of Control occurs.  Anything in this Agreement to the contrary
notwithstanding, if Executive’s employment with Employer is terminated prior to
the date on which a Change of Control occurs, and it is reasonably demonstrated
that such termination (a) was at the request of a third party who has taken
steps reasonably calculated to effect a Change of Control or (b) otherwise
arose in connection with or anticipation of a Change of Control, then for all
purposes of this Agreement the “Effective Date” shall mean the date immediately
prior to the date of such termination.

 

B.            Obligations of
Employer upon Termination.  If
within one (1) year following the Effective Date of a Change of Control,
Executive’s employment is deemed terminated Without Cause within the two-year
period immediately preceding the end of the Employment Period, then in addition
to any amount payable under Section 4(G), Employer shall pay to Executive
in a lump sum in cash within thirty (30) days after the Date of Termination to
the extent not theretofore paid, an amount equal to (i) two times Executive’s
then Base Salary, two times the then Base Bonus, and the benefits provided
pursuant to Section 3(D), less (ii) the amount payable under
Section 4(G) (except that Executive, at his option, may choose to continue
to have he and his family covered, to the extent they are then covered, by
Employer’s health plan in lieu of receiving a lump sum payment for that
benefit, and Employer shall use reasonable efforts to cooperate in such event);
provided, however, that if the amount calculated under this Section 5(B)
is a negative number, Executive shall not be deemed to owe that amount to
Employer.

 

C.            Non-exclusivity of
Rights.  Nothing in this Agreement
shall prevent or limit Executive’s continuing or future participation in any
benefit, bonus, incentive or other plans, programs, policies or practices
provided by Employer or its subsidiaries and for which Executive may qualify,
nor shall anything herein limit or otherwise affect such rights as Executive
may have under any stock option or other agreements with Employer or any of its
subsidiaries.  Amounts which are vested
benefits or which Executive is otherwise entitled to receive under any plan,
policy, practice or program of Employer or any of its subsidiaries at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program; provided that the vesting schedules, if any,
under all stock options held by Executive shall continue to run to the maximum
extent permitted by applicable law.

 

D.            Interest.  Without limiting the rights of Executive at
law or in equity, if Employer fails to make any payment or provide any benefit
required to be made or provided hereunder on a timely basis, Employer will pay
interest on the amount or value thereof at any annualized rate of interest
equal to the so-called composite “prime rate” as quoted from time to time
during the relevant period in the Eastern Edition of The Wall Street Journal.  Such interest will be payable as it accrues
on demand.  Any change in such prime
rate will be effective on and as of the date of such change.

 

6.             Confidentiality.

 

A.            In the course of his
employment, Employer or any of its subsidiaries may disclose or make known to
Executive, and Executive may be given access to or may become acquainted with,
certain information, trade secrets or both, including but not limited to
confidential information and trade secrets regarding tapes, computer programs,
designs, skills, procedures, formulations, methods, documentation, drawings,
facilities, customers, policies,

 

6

 

marketing, pricing,
customer lists and leads, and other information and know-how, all relating to
or useful in Employer’s business or the business of its subsidiaries and/or
affiliates (collectively, the “Information”), and which Employer considers
proprietary, desires to maintain confidential and is not in the public
domain.  During the Employment Period
and at all times thereafter, Executive shall not in any manner, either directly
or indirectly, divulge, disclose or communicate to any person or firm, except
to or for Employer’s benefit as directed by Employer or except as required by
applicable law or court process (but only after giving Employer written notice
so that Employer may attempt to obtain a protective order), any of the
Information which he may have acquired in the course of or as an incident to
his employment by Employer, the parties agreeing that such information affects
the successful and effective conduct of Employer’s business and its goodwill,
and that any breach of the terms of this Section 6 is a material breach of
this Agreement.

 

B.            All equipment,
documents, memoranda, reports, records, files, materials, samples, books,
correspondence, lists, other written and graphic records, and the like
(collectively, the “Materials”) affecting or relating to the business of
Employer or of its subsidiaries and/or affiliates, which Executive shall
prepare, use, construct, observe, possess or control shall be and remain
Employer’s sole property or in Employer’s exclusive custody, and must not be
removed from the premises of Employer except as directed by Employer’s Board of
Directors in writing.  Promptly upon
termination of the Agreement or Executive’s employment hereunder for any
reason, or otherwise upon request of the Chief Executive Officer of Employer,
the Information, the Materials and all copies thereof in the custody or control
of Executive shall be delivered to Employer.

 

7.             Restrictive
Covenant.

 

A.            During the Employment Period and, if
Executive is terminated for Cause or if Executive terminates his employment
pursuant to Sections 4(B), 4(E)(1) or 4(E)(4), for a period of two (2) years
thereafter, Executive will not, directly or indirectly:

 

i.              engage in any trade or business in any
capacity in the liquor industry, anywhere in the United States or such other
country or countries in which Employer actively engages in its trade or
business as of the Date of Termination (“Territory”);

 

ii.             become associated as a manager, supervisor,
employee, consultant, advisor, control shareholder (either individually or as
part of an affiliated group), or otherwise of any person, corporation or entity
engaging in any capacity in the liquor industry anywhere in the Territory;

 

iii.            call upon any client or clients of Employer
or any of its subsidiaries for the purpose of selling or soliciting for any
person, corporation or entity, other than any of Employer or its subsidiaries,
sales of any products, processes, or services in any capacity in the liquor
industry within the Territory;

 

iv.            divert, solicit or take away any such client
or clients of Employer or any of its subsidiaries for the purpose of selling
any products or services in any capacity in the liquor industry; and service
any contracts or accounts relating to any products or services in any capacity
in the liquor industry for any person, corporation or entity other than
Employer or any of its subsidiaries; or

 

v.             induce, influence, combine or conspire with,
or attempt to induce, influence, combine or conspire with, any of the officers
or employees of Employer or any of its

 

7

 

subsidiaries
to terminate his or her employment with or to compete against Employer or any
of its subsidiaries in any capacity in the liquor industry.

 

B.            During the Employment Period and, if
Executive’s employment hereunder is terminated pursuant to Sections 4(D),
4(E)(2) or 4(F), for a period thereafter that is the lesser of (a) any
additional periods with respect to which Executive continues to receive Base
Salary, Base Bonus and the benefits described in Section 3(D) under this
Agreement (e.g., Sections 4(G)
and 5(B)), or (b) two (2) years after the Employment Period, Executive will
not, directly or indirectly:

 

i.              engage in any trade or business directly
competitive with that of any of Employer or any of its subsidiaries, anywhere
within the Territory;

 

ii.             become associated as a manager, supervisor,
employee, consultant, advisor, control shareholder (either individually or as
part of an affiliated group), or otherwise of any person, corporation or entity
engaging in any trade or business directly competitive with those of Employer
or any of its subsidiaries anywhere in the Territory;

 

iii.            call upon any client or clients of Employer
or any of its subsidiaries for the purpose of selling or soliciting for any
person, corporation or entity, other than any of Employer or its subsidiaries,
sales of any products, processes, or services directly competitive with any
trade or business of Employer or any of its subsidiaries within the Territory;

 

iv.            divert, solicit or take away any such client
or clients of Employer or any of its subsidiaries for the purpose of selling
any products or services directly competitive with any trade or business of
Employer or any of its subsidiaries; and service any contracts or accounts
relating to any products or services directly competitive with any trade or
business of Employer or any of its subsidiaries for any person, corporation or
entity other than Employer or any of its subsidiaries; or

 

v.             induce, influence, combine or conspire with,
or attempt to induce, influence, combine or conspire with, any of the officers
or employees of Employer or any of its subsidiaries to terminate his or her
employment with or to directly compete against any trade or business of
Employer or any of its subsidiaries.

 

C.            During the Employment Period and, if
Executive’s employment hereunder is terminated effective as of the end of the
Employment Period pursuant to Section 1, for a period of one (1) year
thereafter, Executive will not, directly or indirectly:

 

i.              engage in any trade or business directly
competitive with the production, importing or marketing of premium branded rum
by Employer or any of its subsidiaries, anywhere within the Territory;

 

ii.             become associated as a manager, supervisor,
employee, consultant, advisor, control shareholder (either individually or as
part of an affiliated group), or otherwise of any person, corporation or entity
engaging in any trade or business directly competitive with the production,
importing or marketing of premium branded rum by Employer or any of its
subsidiaries anywhere in the Territory;

 

iii.            call upon any client or clients of Employer
or any of its subsidiaries for the purpose of selling or soliciting for any
person, corporation or entity, other than any of Employer or its subsidiaries,
sales of any products, processes, or services directly competitive

 

8

 

with
the production, importing or marketing of premium branded rum by Employer or
any of its subsidiaries within the Territory;

 

iv.            divert, solicit or take away any such client
or clients of Employer or any of its subsidiaries for the purpose of selling
any products or services directly competitive with the production, importing or
marketing of premium branded rum by Employer or any of its subsidiaries; and
service any contracts or accounts relating to any products or services directly
competitive with the production, importing or marketing of premium branded rum
by Employer or any of its subsidiaries for any person, corporation or entity
other than Employer or any of its subsidiaries; or

 

v.             induce, influence, combine or conspire with,
or attempt to induce, influence, combine or conspire with, any of the officers
or employees of Employer or any of its subsidiaries to terminate his or her
employment with or to directly compete against the production, importing or
marketing of premium branded rum by Employer or any of its subsidiaries.

 

D.            Notwithstanding anything
to the contrary in this Agreement, Executive shall not be precluded from owning less
than five percent (5%) of the outstanding capital stock of any company whose
stock is traded on an established stock exchange or quoted on Nasdaq.  Should any of the time periods or the
geographic area set forth in this Section 7 be held to be unreasonable by
any court of competent subject matter jurisdiction, the parties hereto agree to
petition such court to reduce the time period or geographic area to the maximum
permitted by governing law.

 

8.             Assignments.  No party shall assign his or its rights or
obligations under this Agreement without the prior written consent of the other
party to this Agreement.

 

9.             Amendments.  The provisions of this Agreement may not be
amended, supplemented, waived or changed orally, but only by a writing signed
by the party as to whom enforcement of any such amendment, supplement, waiver
or modification is sought and making specific reference to this Agreement.

 

10.           Remedies.  If a party commits a material breach, or is
about to commit a material breach, of any of the provisions of this Agreement,
the other party shall have the right to have the provisions of this Agreement
specifically enforced by any court having equity jurisdiction without being
required to post bond or other security and without having to prove the
inadequacy of the available remedies at law, it being acknowledged and agreed
that any such breach or threatened breach will cause irreparable injury to the
non-breaching party and that the money damages will not provide an adequate
remedy to the non-breaching party.  In
addition, the non-breaching party may take all such other actions and remedies
available to it under law or in equity and shall be entitled to such damages as
it can show it has sustained, by reason of such breach.

 

11.           Surrender of Books
and Records.  Executive acknowledges
that all lists, books, records, literature, products and any other materials
owned by Employer or its subsidiaries or used by them in connection with the
conduct of their business, shall at all times remain the property of Employer
and its subsidiaries and that upon termination of employment hereunder,
irrespective of the time, manner or cause of said termination, Executive will
surrender to Employer and its subsidiaries all such lists, books, records,
literature, products and other materials.

 

9

 

12.           Severability.  If any provision of this Agreement or any
other agreement entered into pursuant to this Agreement is contrary to,
prohibited by or deemed invalid under applicable law or regulation, such
provision shall be inapplicable and deemed omitted to the extent so contrary,
prohibited or invalid, but the remainder of this Agreement shall not be
invalidated thereby and shall be given full force and effect so far as
possible.  If any provision of this
Agreement may be construed in two or more ways, one of which would render the
provision invalid or otherwise voidable or unenforceable and another of which
would render the provision valid and enforceable, such provision shall have the
meaning which renders it valid and enforceable.

 

13.           Notices.  All notices, requests, consents and other
communications required or permitted under this Agreement shall be in writing
(including electronic transmission) and shall be (as elected by the person
giving such notice) hand delivered by messenger or courier service,
electronically transmitted, or mailed (airmail if international) by registered
or certified mail (postage prepaid), return receipt requested, addressed to:

 

	
  If
  to Employer:

  	
   

  	
  With
  a copy to:

  
	
   

  	
   

  	
   

  
	
  Todhunter
  International, Inc.

  	
   

  	
  Gunster,
  Yoakley & Stewart, P.A.

  
	
  222
  Lakeview Avenue

  	
   

  	
  777
  South Flagler Drive

  
	
  Suite
  1500

  	
   

  	
  Suite
  500 East

  
	
  West
  Palm Beach, Florida 33401

  	
   

  	
  West
  Palm Beach, Florida 33401

  
	
  (561)
  655-8977

  	
   

  	
  (561)
  650-0553

  
	
  Fax:
  (561) 655-9718

  	
   

  	
  Fax:
  (561) 655-5677

  
	
  Attn:
  Jay S. Maltby

  	
   

  	
  Attn:
  Michael V. Mitrione, Esq.

  

 

	
  If
  to Employee:

  
	
   

  
	
  Ousik
  Yu

  
	
   

  
	
   

  
	
  Telephone:

  	
   

  
	
  Fax:

  	
   

  
			

 

or
to such other address as any party may designate by notice complying with the
terms of this Section.  Each such notice
shall be deemed delivered (a) on the date delivered if by personal
delivery; (b) on the date of transmission with confirmed answer back if by
electronic transmission; and (c) on the date upon which the return receipt
is signed or delivery is refused or the notice is designated by the postal
authorities as not deliverable, as the case may be, if mailed.

 

14.           Binding Effect.  All of the terms and provisions of this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by the
parties and their respective administrators, executors, legal representatives,
heirs, successors and permitted assigns, whether so expressed or not.

 

15.           Waiver.  The failure or delay of any party at any
time to require performance by another party of any provision of this
Agreement, even if known, shall not affect the right of such party to require
performance of that provision or to exercise any right, power or remedy under
this Agreement.  Any waiver by any party
of any breach of any provision of this Agreement should not be construed as a
waiver of any continuing or succeeding breach of such provision,

 

10

 

a waiver of the provision
itself, or a waiver of any right, power or remedy under this Agreement.  No notice to or demand on any party in any
circumstance shall, of itself, entitle such party to any other or further
notice or demand in similar or other circumstances.

 

16.           Governing Law.  This Agreement and all transactions
contemplated by this Agreement shall be governed by, and construed and enforced
in accordance with, the laws of the State of Florida.

 

17.           Jurisdiction and
Venue.  The parties acknowledge that
a substantial portion of the negotiations, anticipated performance and
execution of this Agreement occurred or shall occur in Palm Beach County,
Florida.  Any civil action or legal
proceeding arising out of or relating to this Agreement shall be brought in the
courts of record of the State of Florida in Palm Beach County or the United
States District Court, Southern District of Florida, West Palm Beach
Division.  Each party consents to the
jurisdiction of such court in any such civil action or legal proceeding and waives
any objection to the laying of venue of any such civil action or legal
proceeding in such court.  Service of
any court paper may be effected on such party by mail, as provided in this
Agreement, or in such other manner as may be provided under applicable laws,
rules of procedure or local rules.

 

18.           Enforcement Costs.  If any civil action, arbitration or other
legal proceeding is brought for the enforcement of this Agreement, or because
of an alleged dispute, breach, default or misrepresentation in connection with
any provision of this Agreement, the successful or prevailing party or parties
shall be entitled to recover reasonable attorneys’ fees, sales and use taxes,
court costs and all expenses even if not taxable as court costs (including,
without limitation, all such fees, taxes, costs and expenses incident to
arbitration, appellate, bankruptcy and post-judgment proceedings), incurred in
that civil action, arbitration or legal proceeding, in addition to any other
relief to which such party or parties may be entitled.  Attorneys’ fees shall include, without
limitation, paralegal fees, investigative fees, administrative costs, sales and
use taxes and all other charges billed by the attorney to the prevailing party.

 

19.           Entire Agreement.  This Agreement represents the entire
understanding and agreement between the parties with respect to the subject
matter of this Agreement, and supersedes all other negotiations, understandings
and representations (if any) made by and between such parties (including, without
limitation, any and all prior employment agreements and all amendments thereto
between Executive and Employer).

 

20.           No Mitigation
Obligation.  Employer hereby
acknowledges that it will be difficult and may be impossible for Executive to
find reasonably comparable employment following the Date of Termination.  Accordingly, the payment of the severance
compensation by Employer to Executive in accordance with the terms of this
Agreement is hereby acknowledged by Employer to be reasonable and Executive will
not be required to mitigate the amount of any payment provided for in this
Agreement by seeking other employment or otherwise, nor will any profits,
income, earnings or other benefits from any source whatsoever create any
mitigation, offset, reduction or any other obligation on the part of Executive
hereunder, or otherwise.

 

21.           Survival.  The provisions of Sections 3B and 4 through
21 shall survive any termination or expiration of this Agreement.

 

11

 

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

 

 

	
   

  	
  /s/

  	
  Ousik
  Yu

  	
   

  
	
   

  	
   

  	
  Ousik Yu, Executive

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TODHUNTER
  INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:/s/

  	
  Jay
  S. Maltby

  	
   

  
	
   

  	
   

  	
  Jay S. Maltby

  
	
   

  	
   

  	
  Chief Executive Officer

  
						

 

12

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