Document:

Exhibit 10.1

PNCBANK

February 26, 2001

Joseph Sanpietro, President
Medi-Hut Co., Inc.
1935 Swarthmore Avenue
Lakewood, NJ 08701

Re:      $750,000.00 Committed Line of Credit

Dear Mr.  Sanpietro:

     We are pleased to inform you that PNC Bank, National Association (the
"Bank"), has approved your request for a committed line of credit (the "Loan")
to Medi-Hut Co., inc.  (the "Borrower").  We look forward to this opportunity
to help you meet the financing needs of your business.  All the details
regarding your Loan are outlined in the following sections of this letter.  If
these terms are satisfactory, please follow the instructions for proceeding
with your Loan provided at the end of this letter.

1.      Facility and Use of Proceeds.  This is a committed revolving line of
credit under which the Borrower may request and the bank, subject to the terms
and conditions of this letter, will (i) make advances to the Borrower; (ii)
issue commercial letters of credit (the "Letters of Credit"); and (iii) accept
and discount drafts drawn by the Borrower on the Bank (each, a "Bankers'
Acceptance"); from time to until the Expiration Date, in the aggregate amount
at any time outstanding not to exceed $750,000 (the "Line of Credit").  The
"Expiration Date" means January 31, 2002, or such later date as may be
designated by the Bank by written notice to the Borrower.

      (a)      Issuance and Expiry of Letters of Credit.  The Letters of
Credit shall be governed by one or more reimbursement agreements executed by
the Borrower (each, a "Reimbursement Agreement").  Each request for the
issuance of a Letter of Credit must be accompanied by the Borrower's execution
of an application the Bank's standard forms, together with all supporting
documentation.  Each Letter of Credit will be issued in the Bank's sole
discretion and in a form acceptable to the Bank.  The availability of
advances, Letters of Credit and Banker's Acceptances under the Line of Credit
shall be reduced by the face amount of each Letter of Credit issued and
outstanding (whether or not drawn).  Unless approved by the Bank, no Letter of
Credit shall have an expiry date beyond the earlier of; (i) one year after the
date of its issuance; or (ii) 180 days after the Expiration Date.  This letter
is not a pre-advice for the issuance of a letter of credit and is not
irrevocable.

                                  -1-           Form 7A-Multistate Rev.3/99

<PAGE>

      (b)      Banker's Acceptances.

            (i)      Each request for a Banker's Acceptance must be
accompanied by a certificate signed by the Borrower in form and substance
satisfactory to the Bank.  The availability of advances, Letters of Credit and
Bankers' Acceptances under the Line of Credit shall be reduced by the face
amount of each Bankers' Acceptance issued and outstanding (whether or not
honored).  Unless approved by the Bank, each Banker's Acceptance shall have a
maturity date of not more than ninety (90) days from the date of its creation
and, in no event, beyond the Expiration Date.

            (ii)      The Bank shall discount each Bankers' Acceptance by
deducting from the face amount of the draft; (a) a discount determined by
applying the Bank's Discount Rate, (as hereinafter defined) to such face
amount for the period from acceptance to maturity; and (b) an acceptance
commission equal to 200 basis points (2.00%) of the face amount of such draft
for the period from acceptance to maturity; both calculated on the basis of a
year of three hundred sixty (360) days and shall make the net amount available
to the Borrower by crediting the Borrower's demand deposit account with the
Bank.  The Borrower agrees to immediately repay the face amount of the
Bankers' Acceptance when it is honored by the Bank.  "Discount Rate" means the
Bank's prevailing discount rate for bankers' acceptances having face amounts
and maturities comparable to those of the draft to be discounted, as
determined by the Bank on the date of discount.

            (iii)      Neither the bank nor any of its directors, officers, or
employees shall be liable for any action taken or omitted under or in
connection with any Bankers' Acceptance, any draft to which a Bankers'
Acceptance related or any document(s) relating or pertaining to a Bankers'
Acceptance.  The Bank shall be entitled to act (and shall be fully protected
against any claim of loss by the Borrower occasioned by the lack, or claimed
lack, of authenticity or authority of the issuance of any draft or signature
thereon, in acting) upon any oral or written communication of instrument
reasonably believed by the Bank to be genuine and correct and to have been
made by a proper person

            (iv)      The Borrower further agrees that, in the event that any
Bankers' Acceptance shall not, in the reasonable opinion of the bank, meet all
the requirements for "eligible" Bankers' Acceptances under Section 13 of the
Federal Reserve Act (the "Act") or any change in the applicable law, the
Borrower shall indemnify the Bank against any loss or expense incurred by the
Bank, directly or indirectly, arising out of such ineligibility including,
without limitation, any cost of maintaining reserves in the respect of such
Bankers' Acceptance and any loss or expense resulting from the illiquidity of
the market for ineligible

                                   -2-        Form 7A - Multistate Rev.3-99
<PAGE>

bankers' acceptances.  If the Bank sustains or incurs any such costs, expenses
or losses, it shall from time to time notify the Borrower of the amount
determined in good faith by the Bank (which good faith determination shall be
conclusive absent manifest error) to be necessary to indemnify the Bank for
such loss or expense.  Such amount shall be due and payable by the Borrower to
the Bank on demand.

      (c)      Letter of Credit Fees.  The Borrower agrees to pay to the Bank
the following commissions, fees and expenses in connection with the Letters of
Credit and Bankers' Acceptances:

            (i)      If a Letter of Credit is a commercial or trade Letter of
Credit, a commission of one-quarter percent (0.25%) of the face amount of such
Letter of credit together with such customary fees thereof as shall be
required by the Bank.

            (ii)      All reasonable and customary charges which the Bank may
assess in connection with, and any all expenses which the Bank may pay or
incur in connection with, the issuance, extension, processing, amendment or
payment of any Letter of Credit.

2.      Note.  The obligation of the Borrower to repay advances under the Line
of Credit shall be evidenced by a promissory note (the "Note") in form and
content satisfactory to the Bank.

        This letter (the "Letter Agreement"), the Note and the other loan
documents delivered pursuant hereto will constitute the "Loan Documents."
Capitalized terms not defined herein shall have the meaning ascribed to them
in the Loan Documents.

3.      Interest Rate.  Interest on the unpaid balance of the Line of Credit
advances will be charged at the rates, and is payable on the dates and times,
set forth in the note evidencing the Loan.

4.      Repayment.  Subject to the terms and conditions of this Letter
agreement the Borrower may borrow, repay and reborrow under the Line of Credit
until the Expiration Date, on which date the outstanding principal balance and
any accrued but unpaid interest shall be due and payable.  Interest will be
due and payable on a monthly basis, and will be computed on the basis of a
year of 360 days and paid on the actual number of days elapsed.

5.      Security.  The Borrower must cause or has previously caused the
following to be executed and delivered to the Bank in form and content
satisfactory to the Bank as security for the Loan;

      (a)      a security agreement granting the Bank a first priority
perfected lien on the Borrower's existing and future personal property,
including but not limited to accounts, inventory, equipment, general
intangibles, chattel paper, documents and instruments.

                                    -3-      Form 7-A - Multistate Rev.3/99

<PAGE>

      (b)      There are no actions, suits, proceedings or governmental
investigations pending or, to the knowledge of the Borrower, threatened
against the Borrower which could result in a material adverse change in its
business, assets, operations, financial condition or results of operations and
there is no basis known to the Borrower or its officers, directors or
shareholders for any such action, suit, proceedings or investigation.

      (c)      The Borrower has filed all returns and reports that are
required to be filed by it in connection with any federal, state or local tax,
duty or charge levied, assessed or imposed upon the Borrower or its property,
including unemployment, social security and similar taxes and all of such
taxes have been either paid or adequate reserve or other provision has been
made therefor.

      (d)      The Borrower is duly organized, validly existing and in good
standing under the laws of the state of its incorporation or organization and
has the power and authority to own and operate its assets and to conduct its
business as not pr proposed to be carried on, and is duly qualified, licensed
and in good standing to do business in all jurisdictions where its ownership
of property or the nature of its business requires such qualification or
licensing.

      (e)      The Borrower has full power and authority to enter into the
transactions provided for in this Letter Agreement and has been duly
authorized to do so by all necessary and appropriate actions and when executed
and delivered by the borrower, this Letter Agreement and the other Loan
Documents will constitute the legal, valid and binding obligations of the
Borrower, enforceable in accordance with their terms.

      (f)      There does not exist any default or violation by the Borrower
of or under any of the terms, conditions or obligations of: (i) its
organizational documents, (ii) any indenture, mortgage, deed of trust,
franchise, permit, contract, agreement, or other instrument to which it is a
party or by which it is bound; or (iii) any law, regulation, ruling, order,
injunction, decree, condition or other requirement applicable to or imposed
upon the Borrower by any law or by any governmental authority, court or
agency.

      (g)      The Borrower has reviewed the areas within its business and
operations which could be adversely affected by, and has developed or is
developing a program to address on a timely basis the risk that certain
computer applications used by the Borrower may be unable to recognize and
perform properly date-sensitive functions involving dates prior to and after
December 31, 1999 (the "Year 2000 Problem").  The Year 2000 Problem will not
result, and is not reasonably expected to result, in any material adverse
effect on the business, properties, assets, financial condition, results of
operations or prospects of the Borrower, or the ability of the Borrower to
duly and punctually pay or perform its obligations hereunder and under the
other Loan Documents.

8.      Fees.  On the date of the Note, the Borrower shall pay to the Bank a
fee of $1,000.00.

                                      -5-        Form 7A- Multistate Rev.3/99

<PAGE>

9.      Expenses.  The Borrower will reimburse the Bank for the Bank's
out-of-pocket expenses incurred or to be incurred in conducting UCC, title and
other public record searches, and in filing and recording documents in the
public records to perfect the Bank's liens and security interests.  The
Borrower shall also reimburse the Bank for the Bank's expenses (including the
reasonable fees and expenses of the Bank's outside and in-house counsel) in
documenting and closing this transaction, in connection with any amendments,
modifications or renewals of the Loan, and in connection with the collection
of all of the Borrow's obligations to the Bank, including but limited to
enforcement actions relating to the Loan.

10.      Depository.  The Borrower will establish and maintain at the Bank the
Borrower's primary depository accounts.

11.      Additional Provisions.  Before the first advance under the Loan, the
Borrower shall execute and deliver to the Bank the Note and other required
Loan Documents and such other instruments and documents as the Bank may
reasonably request, such as certified resolutions, incumbency certificates or
other evidence of authority.  The Bank will not be obligated to make any
advance under the line of Credit if any Event of Default or event which with
the passage of time, provision of notice or both would constitute an Event of
Default shall have occurred and be continuing.

      Prior to execution of the final Loan Documents, the Bank may terminate
this Letter Agreement if a material adverse change occurs with respect to the
Borrower, any guarantor, any collateral for the Loan or any other person or
entity connected in any with the Loan, or if the Borrower fails to comply with
any of the terms and conditions of this Letter Agreement, or if the Bank
reasonably determines that any of the conditions cannot be met.

      This Letter Agreement is governed by the laws of New Jersey.  No
modification, amendment or waiver of any of the terms of this Letter
Agreement, nor any consent to any departure by the Borrower therefrom, will be
effective unless made in a writing signed by the party to be charged, and then
such waiver or consent shall be effective only in the specific instance and
for the purpose for which given.  When accepted, this Letter Agreement and the
other Loan Documents will constitute the entire agreement between the Bank and
the borrower concerning the Loan, and shall replace all prior understandings,
statements, negotiations and written materials relating to the Loan.

      THE BORROWER AND THE BANK IRREVOCABLY WAIVE ANY AND ALL RIGHTS THEY MAY
HAVE TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM OF ANY NATURE
ARISING OUT OF THIS LETTER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY
AND ACKNOWLEDGE THAT THE FOREGOING WAIVER IS KNOWING AND VOLUNTARY.

      If and when a loan closing occurs, this Letter Agreement (as the same
may be amended from time to time) shall survive the closing and will serve as
our loan agreement throughout the term of the Loan.

                                    -6-          Form 7A-Multistate Rev.3/99

<PAGE>

      To accept these terms, please sign the enclosed copy of this Letter
Agreement as set forth below and the Loan Documents and return them to the
Bank within 15 days from the date of this Letter Agreement, or this Letter
Agreement may be terminated at the Banks option without liability or further
obligation of the Bank.

Thank you for giving PNC Bank this opportunity to work with your business.  We
look forward to other ways in which we may be of service to your business or
to you personally.

Very truly yours,
PNC BANK, NATIONAL ASSOCIATION

       /S/ Raymond J. Eclehoff
By:_________________________________
      Raymond J.  Eclehoff
      Vice President

                                  ACCEPTANCE
                                 -----------

With the intent to be legally bound hereby, the above terms and conditions are
hereby agreed to and accepted as of this 26 day of February, 2001.

                                    BORROWER:

                                    MEDI-HUT CO., INC.

                                         /s/ Joseph Sanpietro Pres
                                    By: ___________________________________
                                           Joseph Sanpietro, President
   (SEAL)

                                         /s/ Vincent Sanpietro Vice Pres
                                    By: ___________________________________
                                           Vincent Sanpietro, Vice President
   (SEAL)

                                    -7-         Form 7A - Multistate Rev.3/99

<PAGE>

                               PROMISSORY NOTE

<TABLE>
<CAPTION>

<S>            <C>        <C>         <C>       <C>    <C>          <C>      <C>      <C>
-------------------------------------------------------------------------------------------------
|Principal  | Loan Date  | Maturity   | Loan No.| Call | Collateral | Account| Officer| Initials|
------------ ------------ ------------ --------- ------ ------------ -------- -------- ----------
|$750,000.00| 02-26-2001 | 01-31-2002 |         |      |            |  24381 |        |         |
-------------------------------------------------------------------------------------------------
| References in the shaded area are for Lender's use only and do not limit the applicability of |
|                          This document to any particular loan or item.                        |
-------------------------------------------------------------------------------------------------
</TABLE>

Borrower: Medi-Hut Co., INC          Lender: PNC Bank, National Association
          (tin:222408721)                    Two Tower Center Boulevard
          1935 Swarthmore Avenue             East Brunswick, NJ 06815
          Lakewood, NJ 08701
==============================================================================

Principal                   Initial              Date of
  Amount:  $750,000.00        Rate:  9.250%        Note:  February 26, 2001

PROMISE TO PAY, MEDI-HUT CO., INC. ("Borrower") promises to pay  to PNC Bank,
National Association ("Lender"), or order, in lawful money of the United
States of America, the principal amount of Seven Hundred Fifty Thousand &
00/100 dollars ($750,000.00) or so much as may be outstanding, together with
interest on the unpaid outstanding balance of each advance.  Interest shall be
calculated from the date of each advance until repayment of each advance.
Borrower also promises to pay all applicable fees and expenses.

PAYMENT.  Borrower will pay this loan in accordance with the following
      payment schedule:

     Borrower will pay regular monthly payments of accrued interest
      beginning March 28, 2001, and all subsequent Interest payments
      are due on the same day of each month after that.  Borrower
      will pay this loan in one payment of all outstanding principal
      plus accrued interest on the Expiration Date, Borrower may
      borrower, repay and reborrow hereunder until the Expiration Date,
      subject to the terms and conditions of this note.  The "expiration
      date" shall mean January, 31, 2002, or such later date as may be
      designated by written notice from Lender to Borrower.  Borrower
      acknowledges and agrees that in no event will Lender be under
      any obligation to extend or renew the loan or this Note beyond
      the initial Expiration Date.  In no event shall the aggregate
      unpaid principal amount of advances under this Note exceed the
      face amount of this Note.

The annual interest rate for this note is computed on a 385/380 basis; that
is, by applying the ratio of the annual interest rate over a year of 350 days,
multiplied by the outstanding principal balance, multiplied by the actual
number of days the principal balance is outstanding.  Borrower will pay Lender
at Lender's address shown above or at such other place as Lender may designate
in writing.  Unless otherwise agreed or required by applicable law, payments
will be applied first to accrued unpaid Interest, then to principal, and any
remaining amount to any unpaid collection costs and late charges.

VARIABLE INTEREST RATE.  The interest rate on this Note is subject to change
from time to time based on changes in an index which is the Lender's prime
rate (the "index").  The index is a rate per annum as publicly announced by
Lender form time to time as its prime rate.  The prime rate is not tied to any
external rate or index and it does not necessarily reflect the lowest rate of
interest actually charged by Lender to any particular class or category of
customers.  Lender will tell Borrower the current index rate upon Borrower's
request.  Borrower understand that Lender may make loans based on other rates
as well.  The interest rate change will not occur more often than each day.
The Index currently is 8.500% per annum. The Interest rate to be applied to
the unpaid principal balance of this Note will be at a rate of 0.750%
percentage points over the index, resulting in an initial rate of 9.250% per
annum.  NOTICE: Under no circumstances will the interest rate on this Note be
more than the maximum rate allowed by applicable law.

PREPAYMENT: Borrower may pay without penalty all or a portion of the amount
owed earlier that it is due.  Early payments will not , unless agreed to by
lender in writing, relieve Borrower of Borrower's obligation to continue to
make payments of accrued unpaid interest.  Rather, they will reduce the
principal balance due.

LATE CHARGE: It's payment is 15 days, or more late, Borrower will be charged
5.000% of the unpaid portion of the regularly scheduled payment of $100.00
whichever is less.  This late charge shall be paid to Lender by Borrower for
the purpose of delaying the expense incident to the handling of the delinquent
payment.

DEFAULT.  Borrower will be in default if any of the following happens: (a)
Borrower fails to make any payment when due.  (B) Borrower breaks any promise
Borrower has made to Lender, or Borrower fails to comply with or to perform
when due any other term, obligation, covenant, or condition contained in this
note or any other agreement or loan borrower has with lender.  (c) Borrower
defaults under any loan, extension of credit, security agreement, purchase or
sales agreement, or any other agreement, in favor of any other creditor or
person that may materially affect any of Borrower's property or Borrowers
ability to repay this note or perform Borrower's obligations under this Note
or any of the related documents.  (d) Any representation or statement made or
furnished to Lender by Borrower or on Borrower's behalf is false or misleading
in any material respect either now or at the time made or furnished.  (e)
Borrower becomes insolvent, a receiver is appointed or any part of borrower's
property, borrower makes an assignment for the benefit of creditors, or any
proceeding is commenced either by borrower or against borrower under any
bankruptcy or insolvency laws.  (f) Any creditor tries to take any of
Borrower's property on or in which Lender has a lien or security interest.
This includes a garnishment of or levy on any of Borrower's accounts with
Lender.  (g) any guantor dies or any of the other events describe in this
default section occurs with respect to any guarantor of this Note.  (h) A
material adverse change occurs in Borrower's financial condition, or Lender
believes the prospect of payment or performance of the indebtedness is
impaired.

LENDER RIGHT'S.  Upon default, Lender may declare the entire unpaid principal
balances on this Note and all accrued unpaid interest immediately due, without
notice, and then Borrower will pay that amount.  Upon default, including
failure to pay upon final maturity, Lender, at its option, may also , if due,
without notice, and then borrower will pay that amount.  Upon default,
including failure to pay upon final maturity, lender, at its option, may also,
if permitted under applicable law, increase the variable interest rate on this
not to 5.750 percentage points over the index.  The interest rate will not
exceed the maximum rate permitted by applicable law.  Lender may hire or pay
someone else to help collect this note if borrower does not pay.  Borrower
also will pay Lender that amount.  This includes, subject to any limits under
applicable law, Lender's attorneys' fees and Lender's legal expenses whether
or not there is a lawsuit, including attorney's fees and legal expenses for
bankruptcy proceedings (including efforts to modify or vacate any automatic
stay or injunction), appeals, and any anticipated post-judgement collection
services.  If not prohibited by applicable law, borrower also will pay any
court costs, in addition to all other sums provided by law.  This note has
been delivered to lender and accepted by lender in the State of New Jersey.
If there is a lawsuit, borrower agrees upon lender's request to submit to the
jurisdiction of the courts of MIDDLESEX County, the State of New Jersey.
Lender and Borrower hereby waive the right to any jury trial in any action,
proceeding, or counterclaim brought by either Lender or Borrower against the
other.  This Note shall be governed by and constructed in accordance with the
laws of the State of New Jersey.

RIGHT OF SETOFF.   Borrower grants to Lender a contractual security interest
in, and hereby assigns, conveys, delivers, pledges, and transfers to Lender
all Borrower's right, title and interest in and to, Borrower's accounts with
Lender (whether checking, savings, or some other account), including without
limitation all accounts held jointly with someone else and all accounts
Borrower may open in the future, excluding however all IRA and Keogh accounts,
and all trust accounts for which the grant of a security interest would be
prohibited by law.  Borrower authorizes Lender, to the extent permitted by
applicable law, to charge or setoff all sums owing on this Note against any
and all such accounts.

LINE OF CREDIT.    This Note evidences a revolving line of credit.  Advances
under this Note may be requested orally by Borrower or by an authorized
person.  Lender may, but need not require that all oral requests be confirmed
in writing.  All communications, instruction, or directions by telephone or
otherwise to lender are to be directed to lender's office shown above.
(Illegible) of credit until lender receives from borrower at lender's address
shown above written notice of relocation of their authority: JOSEPH SANPIETRO
PRESIDENT; and VINCENT SANPIETRO, VICE PRESIDENT.  Borrower agrees to be
liable for all sums either: (a) advanced in accordance with the instructions
of an authorized person or (b) credited to any of borrower's accounts with
lender.  The unpaid principal balance owed on this note or any time may be
evidenced by endorsements on this note or by Lender's internal records,
including daily computer print-outs.  Lender will have no obligation to
advance funds under this Note if: (a) Borrower or any guarantor is in default
under the terms of this Note or any agreement that Borrower or any guarantor
has with Lender, including any agreement made in connection with the signing
of this Note; (b) Borrower or any guarantor cease doing business or is
insolvent; (c) any guantor seeks, , claims or otherwise attempts to limit,
modify or revoke such guarantor's guarantee of this Note or any other loan
with Lender; or (d) Borrower has applied funds provided pursuant to this Note
for purposes other than those authorized by Lender.

RIGHT OF SETOFF.  In addition to all liens upon and rights of setoff against
the moneys, securities or other property of the undersigned given to Lender by
law, Lender shall have, with respect to the undersigned's obligations to
Lender hereunder and to the extent permitted by law, a contractor possessory
security interes in and right of setoff against, and the undersigned hereby
assigns, conveys, delivers, pledges, and transfers to lender all of the
undersigned's right, title and interest in and to, all deposits, moneys,
securities and other property of the undersigned now or hereafter in the
possession of, on deposit with, or in transit to, lender, whether held in a
general or special account or deposit, whether or not held jointly with
someone else, whether or not held jointly with someone else, or whether held
for safekeeping or otherwise, excluding however, all IRA, Keogh and trust
accounts.  Every such security interest and right of setoff may be exercised
without demand upon or notice to the undersigned and without any prior action
of any kind by Lender.  No security interest or right of setoff shall be
deemed to have been waived by any act or conduct on the part of Lender or by
any neglect to exercise such right of setoff or to enforce such security
interest is specifically waived or released by an instrument in writing
executed by Lender.

YEAR 2000 COMPLIANCE.  Borrower has reviewed the areas within its business and
operations which could be adversely affected by, and has developed or is
developing a program to address on a timely basis the risk that certain
computer applications used by Borrower may be unable to recognize and perform
properly date-sensitive functions involving dates prior to and after December
31, 1999 (the "Year 2000 Problem").  The year 2000 problem will not result,
and is not reasonably expected to result, in any material adverse effect on
the business, properties, assets, financial condition, results of operation or
prospects of borrower, or the ability of Borrower to duly and punctually pay
or perform its obligations hereunder and under the related documents.

ADDITIONAL PROVISION.  This Note is issued pursuant to letter Agreement date
February 28, 2001, and the other documents referred to therein, the terms of
which are incorporated herein by reference.

GENERAL PROVISIONS.  Lender may delay or forge enforcing any of its rights or
remedies under this Note without losing them.  Borrower and any other person
who signs, guarantees or endorses this Note, to the extent allowed by law,
waive presentment, demand for payment, protest and notice of dishonor.  Upon
any change in the terms of this Note, and unless otherwise expressly stated in
writing, no party who signs this note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability.  All such
parties agree that Lender may renew or extend (repeatedly and for any length
of time) this loan, or release any party or guarantor or collateral; or
impair, fail to realize upon or perfect lender's security interest in the
collateral; and take any other action deemed necessary by Lender without the
consent of or notice to anyone.  All such parties also agree that Lender may
modify this loan without the consent of or notice to anyone other than the
party with whom the modifications is made.

PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS.  BORROWER AGREES
TO THE TERMS OF THE NOTE AND ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THE
NOTE.

BORROWER:

MEDI-HUT CO., INC

By: ____________________________
    Joseph Sanpietro, President<PAGE>

                                                                   EXHIBIT 10.12

                             EMPLOYMENT AGREEMENT

     This agreement is dated and made effective the 17th day of July 2000 (the
"Effective Date") between Wayne Drury ("Executive") and Pyramid Breweries Inc.,
a Washington Corporation ("Company").

     1.   Employment. Company employs Executive and Executive accepts employment
on the terms and conditions in this agreement.

     2.   Duties. Executive is employed in the capacity of Chief Financial
Officer and VP -- Finance & Administration. In this capacity, Executive shall
have primary responsibility for the finance, planning, investor relations,
accounting and reporting, risk management, benefit administration, management
information systems, and legal affairs. Executive shall report directly to, and
take direction from, the Company's Chief Executive Officer. Executive shall
perform the duties customarily performed by the Chief Financial Officer and VP
-- Finance & Administration, provided that Executive's precise duties may be
changed, extended or curtailed, from time to time, at the Chief Executive
Officer's direction, and Executive shall assume and perform the further
reasonable responsibilities and duties that the Chief Executive Officer may
assign from time to time.

     3.   Intensity of Effort; Other Business. Executive shall devote his entire
working time, attention, and efforts to Company's business and affairs, shall
faithfully and diligently serve Company's interests and shall not engage in any
business or employment activity that is not on Company's behalf (whether or not
pursued for gain or profit) except for (a) activities approved in writing in
advance by the Board and (b) passive investments that do not involve Executive
providing any advice or services to the businesses in which the investments are
made.

     4.   Term. The term of this agreement is of indefinite duration. As stated
in paragraph 9 below, this agreement and Executive's employment relationship may
be terminated at any time, with or without cause.

     5.   Compensation. Executive's compensation shall be as follows:

          (a)  Executive's salary shall be $5,000.00 payable every two weeks
(equal to $130,000.00 on an annualized basis). Payday is the Friday following
each two-week period. Executive's salary shall be reviewed annually and adjusted
as determined in the Chief Executive Officer's sole discretion.

          (b)  Executive will be eligible to receive a personal performance
based bonus each year of up to an additional 30% of base salary. The criteria
and pay-out under the bonus program will be determined by the Chief Executive
Officer; will be based on both individual and corporate performance and will be
quarterly and/or annually based. If Executive is not an eligible participant for
the full plan period, pro-rated payment will be made per rules outlined in the
plan document.

          (c)  Executive shall be eligible for stock options and/or other
incentive compensation) only  as stated in Non-Qualified Stock Option Agreements
between the Company and Executive.

          (d)  Executive shall receive a car allowance of $300 per month, plus
reimbursement for gas purchased by employee for business use.

     6.   Benefit Plans. Executive (and qualifying immediate family members
where applicable) shall be eligible to participate in the Company's Employee
Benefit Package offered generally to employees, which currently includes health
insurance through Blue Cross of Washington, life and AD&D insurance, fifty
percent (50%) Company-payment of vision and dental, maternity leave, health
insurance continuation, sick leave, paid vacation, holidays, and 401(k). The
exact terms and conditions of the Company's benefits, including eligibility are
governed by the benefit plans, not this agreement or any summary provided to
Executive.

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<PAGE>

     7.   Vacation and Sick Leave. Executive shall be entitled to accrue up to
four weeks (20 days) of paid vacation and five days of paid sick leave per
calendar year (prorated if this agreement begins and/or ends in the middle of a
calendar year). Up to three weeks (15 days) of vacation not used in any calendar
year may be carried over into the next calendar year; otherwise unused vacation
is forfeited at the end of the calendar year. Upon termination of employment for
any reason, Executive shall be paid for earned but unused vacation. Sick leave
may be accumulated up to a maximum of twenty (20) days. Unused sick leave is not
paid upon termination of employment, regardless of the reason.

     8.   Business Expenses. Executive is authorized to incur reasonable travel
and entertainment expenses to promote Company's business. Company shall
reimburse Executive for those expenses. Executive shall provide to Company the
itemized expense account information that Company reasonably requests.

     9.   Termination. Executive's employment may be terminated as follows; in
which event Executive's compensation and benefits shall terminate except as
otherwise provided below:

          (a)  Without Cause or Good Reason. Either party may terminate
Executive's employment at any time by giving fourteen (14) calendar days'
advance written notice of termination to the other without the necessity of
cause or good reason.

          (b)  By Company for Cause. Company may terminate Executive's
employment for cause, without advance written notice of termination, by giving
written notice of such termination. Any termination of Executive's employment
for cause must be approved by a majority of the Board other than Executive.
Executive must be given reasonable advance notice of the meeting at which his or
her termination is to be considered, and a reasonable opportunity to address the
Board. For purposes of this agreement "cause" means and is limited to
dishonesty, fraud, commission of a felony or of a crime involving moral
turpitude, harassment or illegal discrimination of any nature, including sexual
harassment, destruction, theft, or unauthorized use or distribution of Company
property or confidential information, fighting with an employee or customer or
vendor, intoxication at work, use of alcohol to an extent that it impairs
Executive's performance of his or her duties, use of illegal drugs at any time,
malfeasance or gross negligence in the performance of Executive's duties,
violation of law in the course of employment, Executive's failure or refusal to
perform his or her duties, Executive's failure or refusal to follow reasonable
instructions or directions, misconduct, or any material beach of Executive's
duties or obligations to Company.

          (c)  Death. Executive's employment shall terminate automatically upon
Executive's death.

          (d)  Permanent Disability. Company may terminate Executive's
employment immediately if Executive becomes permanently disabled. For purposes
of this agreement Executive will be considered "permanently disabled" if, for a
continuous period of twenty-four (24) weeks or more, Executive has been unable
to perform the essential functions of the job because one or more mental or
physical illnesses and/or disabilities, provided that Company may grant
Executive unpaid leave if and to the extent that, in Company's judgment, doing
so is required by law.

     10.  Termination Payments.

          (a)  Termination Without Cause.

               (i)  If Company terminates Executive's employment when neither
cause nor permanent disability exists, Company shall pay Executive, as
liquidated damages and in lieu of all other remedies to which Executive might be
entitled arising out of the termination, termination payments equal to three
month's salary plus a pro rata share of any personal performance bonus for which
Executive is eligible in the year of termination. For the same three-month
period, Company shall continue to provide at the Company's cost, the Company's
medical benefits to employee and qualifying family members. Such

                                       2
<PAGE>

liquidated damages shall be paid only if Executive executes a full and final
general release of all claims against Company (including Company's officers,
directors, agents, employees and assigns) arising out of Executive's employment
relationship with Company.

               (ii)  In addition, if Company terminates Executive's employment
when neither cause nor permanent disability exists, but Company gives Executive
less than the fourteen (14) days' advance written notice called for above,
Company shall pay Executive, as liquidated damages and in lieu of all other
remedies to which Executive might be entitled arising out of Company's failure
to give fourteen (14) days' advance written notice, termination payments equal
to the additional salary Executive would have received if Company had given
Executive fourteen (14) day's advance written notice of termination.

               (iii) Termination payments shall be paid out at Executive's
normal payroll rate on regular payroll days subject to normal payroll
deductions, commencing first with the termination payments called for by subpart
(ii), if any, followed by the termination payments called for by subpart (i).
Any reimbursable expenses incurred prior to termination will be paid immediately
upon termination.

          (b)  All Other Terminations. In all cases of termination or expiration
of this agreement or of Executive's employment (including, but not limited to, a
termination of Executive by Company for cause of Executive's resignation of
employment), Executive's compensation and benefits shall terminate on the date
the employment ends and Executive shall not be entitled to any termination
payments or damages.

     11.  Confidentiality/Unfair Competition. Executive agrees that Company has
many substantial, legitimate business interests that can be protected only by
Executive agreeing not to compete with Company unfairly. These interests
include, without limitation, Company's contacts and relationships with its
supply sources, Company's reputation and goodwill in the industry, and Company's
rights in its confidential information. Executive agrees that information not
generally known to the public to which Executive has been or will be exposed as
a result of Executive's employment by Company is confidential information that
belongs to Company. This includes information developed by Executive, alone or
with others, or entrusted to Company by its supply sources, customers or others.
Company's confidential information includes, without limitation, information
relating to Company's trade secrets, know-how, procedures, pricing, products,
services, purchasing, accounting, marketing, sales, supply sources, employees,
and customers and active prospects and their related needs. Executive will hold
Company's confidential information in strict confidence and will not disclose or
use it except as authorized by Company and for Company's benefit. Executive also
will not disparage Company or its business or services. Executive will not,
apart from good faith competition, interfere with Company's relationships with
its clients, employees, vendors, bankers or others.

     12.  Possession of Materials. Executive agrees that upon conclusion of
employment or request by Company, Executive shall turn over to Company all
documents, files, office supplies and any other material or work product in
Executive's possession or control that were created pursuant to or derived from
Executive's services or Company.

     13.  Non-raiding of Employees. Executive recognizes that Company's
workforce is a vital part of its business. Therefore, Executive agrees that for
twelve (12) months after Executive's employment with Company ends, regardless of
the reason it ends, Executive will not solicit, directly or indirectly, any
employee to leave his or her employment with Company. For purposes of this
agreement, the phrase "shall not solicit, directly or indirectly," includes,
without limitation, that Executive (a) shall not identify any Company employees
to any third party as potential candidates for employment, such as by disclosing
the names, backgrounds and qualifications of any Company employees; (b) shall
not personally or through any other person approach, recruit or otherwise
solicit employees of Company to work for any other employer; and (c) shall not
participate in any pre-employment interviews with any person who was employed by
Company while Executive was employed or retained by Company.

     14.  Dispute Resolution. Company and Executive agree to resolve all
disputes arising out of

                                       3
<PAGE>

their employment relationship by the following alternate dispute resolution
process: (a) Company and Executive agree to seek a fair and prompt negotiated
resolution; but if this is not successful, (b) all disputes shall be resolved by
binding arbitration; provided that during this process, (c) at the request of
either party, not made later than seventy-five (75) days after the initial
arbitration demand, the parties agree to attempt to resolve any dispute by non-
binding third-party intervention including either mediation or evaluation or
both (but without delaying the arbitration hearing date). By entering into this
contract, both parties give up their right to have the dispute decided in court
by a judge or jury. The provisions of the Washington arbitration statute,
Chapter 7.04 RCW, are incorporated herein to the extent not inconsistent with
the other terms of this agreement.

          (a)  Binding Arbitration. Any controversy or claim arising out of or
connected with Executive's employment at Company, including but not limited to
claims for compensation or severance and claims of wrongful termination, age,
sex, racial or other discrimination, or civil rights violations shall be
determined by arbitration commenced in accordance with RCW 7.04.060, provided
that the total award by a single arbitrator (as opposed to a majority of three
arbitrators) shall not exceed Two Hundred Fifty Thousand Dollars ($250,000). If
either party assets in good faith that it is entitled to an award over Two
Hundred Fifty Thousand Dollars ($250,000), there shall be three (3) arbitrators.
The location of the arbitration shall be Seattle, Washington, or such other city
to which the parties may agree. If Company and Executive cannot agree on the
arbitrator(s), then the arbitrator(s) shall be selected by the administrator of
the American Arbitration Association (AAA) office nearest the city where the
arbitration is to be conducted. Each arbitrator shall be an attorney with at
least 15 years' experience in commercial law or judicial arbitration experience.
All statutes of limitations, which would otherwise be applicable, shall apply to
any arbitration proceeding hereunder. Any issue about whether a controversy or
claim is covered by this agreement shall be determined by the arbitrator(s).

          (b)  Procedures. The arbitration shall be conducted in accordance with
this agreement using as appropriate the AAA Employment Dispute Resolution Rules
in effect on the date hereof. There shall be no discovery or dispositive motion
practice (such as motions for summary judgment or to dismiss or the like) except
that the arbitrator(s) shall authorize such discovery as may be shown to be
necessary to ensure a fair hearing, and no such discovery shall extend the time
limits contained herein. The arbitrator(s) shall not be bound by the rules of
evidence or of civil procedure, but rather may consider such writings and oral
presentations as reasonable business people would use in the conduct of their
day-to-day affairs, and may require both parties to submit some or all of their
respective cases by written declaration or such other manner of presentation as
the arbitrator(s) may determine to be appropriate. The parties agree to limit
live testimony and cross-examination to the extent necessary to ensure a fair
hearing on material issues.

          (c)  Hearing; Law; Appeal Limited. The arbitrator(s) shall take such
steps as may be necessary to hold a private hearing within one hundred twenty
(120) days of the initial request for arbitration and to conclude the hearing
within two (2) days; and the arbitrator(s)'s written decision shall be made not
later than fourteen (14) calendar days after the hearing. The parties agree that
they have included these time limits in order to expedite the proceeding, but
they are not jurisdictional, and the arbitrator(s) may for good cause allow
reasonable extensions or delays, which shall not affect the validity of the
award. The written decision shall contain a brief statement of the claim(s)
determined and the award made on each claim. In making the decision and award
the arbitrator(s) shall apply applicable substantive law. Absent fraud,
collusion or willful misconduct by an arbitrator, the award shall be final and
judgment may be entered in any court having jurisdiction thereof. The
arbitrator(s) may award injunctive relief or any other remedy available from a
judge, including the joinder of parties or consolidation of this arbitration
with any other involving common issues of law or fact or which may promote
judicial economy, and may award attorneys' fees and costs to the prevailing
party, but shall not have the power to award attorneys' fees and costs to the
prevailing party, but shall not have the power to award punitive or exemplary
damages. The decision and award of the arbitrators need not be unanimous;
rather, the decision and award of two (2) arbitrators shall be final.

          (d)  Injunctive Relief. In the case of a breach of any of Executive's
obligations to Company, Company may request a court of competent jurisdiction to
issue such temporary or interim relief

                                       4
<PAGE>

(including temporary restraining orders and preliminary injunctions) as may be
appropriate, either before arbitration is commenced or pending the outcome of
arbitration. No such request shall be a waiver of the right to submit any claim
or controversy to arbitration. Any issues of law or fact, which arise in
connection with such request, shall, at Company's election, be determined by
arbitration in accordance with subparagraph (a) through (c) above.

     15.  Attorneys' Fees; Venue and Jurisdiction. In any lawsuit or arbitration
arising out of or relating to this agreement or Executive's employment,
including without limitation arising from any alleged tort or statutory
violation, the prevailing party shall recover reasonable costs and attorneys'
fees, including on appeal. Venue and jurisdiction of any lawsuit involving this
agreement or Executive's employment shall exist exclusively in state and federal
courts in King County, Washington, unless injunctive relief is sought by Company
and, in Company's judgment, that relief might not be effective unless obtained
in some other venue. The provisions of this section are subject to and do not
supersede the dispute resolution provisions described above.

     16.  Governing Law. This agreement shall be governed by the internal laws
of the state of Washington without giving effect to provisions thereof related
to choice of laws or conflict of laws.

     17.  Saving Provision. If any part of this agreement is held to be
unenforceable, it shall not affect any other part. If any part of this agreement
is held to be unenforceable as written, it shall be enforced to the maximum
extent allowed by applicable law. The confidentiality, possession of materials,
non-competition and non-raiding provisions of this agreement shall survive after
Executive's employment by Company ends, regardless of the reason it ends, and
shall be enforceable regardless of any claim Executive may have against Company.

     18.  Waiver. No waiver of any provision of this agreement shall be valid
unless in writing, signed by the party against whom the waiver is sought to be
enforced. The waiver of any breach of this agreement or failure to enforce any
provision of this agreement shall not waive any later breach.

     19.  Assignment; Successors. Company may assign its rights and delegate its
duties under this agreement. Executive may not assign his or her rights or
delegate his or her duties under this agreement.

     20.  Binding Effect. This agreement is binding upon the parties and their
personal representatives, heirs, successors and assigns.

     21.  Counterparts. This agreement may be executed in any number of
counterparts, each of which shall be an original and all of which, taken
together, shall constitute a single agreement.

     22.  Complete Agreement. This agreement, together with the Employee Stock
Option Agreement(s) dated July 17, 2000 is the final and complete expression of
the parties' agreement relating to Executive's employment. Only a writing signed
by both parties may amend this agreement; it may not be amended orally or by
course of dealing. The parties are not entering into this agreement relying on
anything not set out in this agreement. This agreement shall control over any
contrary policies or procedures of Company, whether in effect now or adopted
later. Company's policies and procedures that do not conflict with this
agreement, whether in effect now or adopted later, shall apply or not apply to
Executive as determined by Company in its discretion.

DATED this 21st day of June, 2000.

EXECUTIVE: /s/ L. Wayne Drury

                                       5
<PAGE>

COMPANY:       PYRAMID BREWERIES INC.

               By /s/ R. Martin Kelly
                  -------------------------------
               Its: Chief Executive Officer

                                       6

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