EXHIBIT 10.1
May 21, 1996
Mr. Richard Finkbeiner
Dear Rick:
On behalf of Creative Computers, Inc. it is my pleasure to confirm our
offer to you of the position of Chief Financial Officer. As we discussed, if
you accept this offer you will be reporting directly to me. I have enjoyed
speaking with you and very much hope that you will accept our offer.
Your duties generally will be in the areas of overseeing and managing the
Company's finance, planning, accounting and administrative functions, as well as
possibly human resources, and you will have dual responsibility for many other
areas, and you may be assigned other duties as needed and your duties may change
from time to time on reasonable notice.
You will earn a monthly base salary of $19,583.33 (payable semi-monthly).
Your bonus potential will be a maximum of $117,500 annually. Twenty-five percent
of the total bonus potential is attainable based on quarterly goals based on
company performance. The remaining 75% of the bonus potential will be based
upon company performance for each fiscal year. For 1996, your bonus, if any,
will be prorated based on the amount of time you are employed here. For the
first twelve months of your employment with the Company, you are guaranteed a
minimum $25,000 bonus, payable at the end of the first twelve months if you have
not already achieved $25,000 in bonus by meeting your quarterly or annual bonus
goals.
You will receive a signing bonus of $25,000 upon the commencement of your
employment. If you decide to leave Creative during the first 90 days, you will
pay back all of this signing bonus.
You will be granted options to purchase 75,000 shares of Creative
Computers, Inc. stock at the price on the date you accept this offer. The first
Mr. Richard Finkbeiner
May 21, 1996
Page 2
5,000 shares will vest when your employment begins. Options on the remaining
70,000 shares will vest as follows, all provided you are still employed by the
Company: options to purchase 35,000 shares will vest quarterly over three years
at a rate of 8.33% per quarter; and options to purchase an additional 35,000
shares will vest annually over five years at a rate of 20% per year.
We will also reimburse you for (or advance as necessary) your moving and
relocation expenses as follows: packing and moving; broker fees and closing
costs for the sale of your current residence in Minnesota; closing costs for
buying a home in Southern California (not including any borrowing costs on the
purchase money); and reasonable living expenses (limited to apartment, rental
car and food) for you while you are living here for up to six months or until
your house in Minnesota sells, whichever is sooner. We will also pay for coach
airfare for you to visit Minnesota once every two weeks during this period. As
to all of the expenses associated with your relocation, we understand that you
will use your best efforts to minimize the expenses as much as reasonably
possible.
You will be eligible for all benefits sponsored by the Company subject to
the terms and conditions of the various benefit programs, including medical,
dental and life insurance. Our 401(k) plan requires that you be employed for at
least 6 months to be eligible, and allows enrollment only twice a year. We
cannot waive those conditions. As we discussed, the Company will reimburse you
for the cost of a $500,000 term life insurance policy, with a carrier and at a
rate subject to approval in the Company's discretion. You will receive a $600
per month auto allowance. You will be eligible for three weeks vacation per
year during your first two years of employment and four weeks per year after the
first three years, provided you are still employed by the Company.
We hope that our association will continue for a substantial period of
time, but we recognize that the future is inherently uncertain and that
assurances of permanent or continuing employment are not feasible. Therefore,
in accordance with our standard policy, your employment will be "at-will." In
other words, either you or the Company can end your employment at any time for
any reason, with or without cause. This term of employment is not subject to
change or modification of any kind except in a writing signed by you and me.
Please note that this agreement supersedes any prior agreements, arrangements or
understandings concerning your employment, and that it constitutes the full,
complete and exclusive agreement between you and the Company as to all matters
covered herein.
In addition, you agree not to in any way jeopardize or expose Creative to
liability by using for Creative's benefit trade secrets of any former employer
or
Mr. Richard Finkbeiner
May 21, 1996
Page 3
client. You further agree and represent that you have not entered into any
agreements with any former employer or client that would affect your ability to
give your full efforts to Creative, would expose Creative to any liability, or
would negatively impact Creative's ability to run its business and compete
effectively for personnel or for business on a go-forward basis. You agree to
sign an agreement to this effect (as well as a confidentiality agreement) prior
to or upon commencement of your employment here.
We would like you to begin work as soon as possible, but not later than
June 10, 1996.
As you know, we plan to announce your joining the Company prior to your
actual start date. Therefore, it is important for you to carefully consider
this offer and be willing to make a definite commitment to joining us before you
sign and send back this letter.
We very much look forward to your joining our organization. In order to
confirm your acceptance of our offer as set forth here, please sign a copy of
this letter and return it to me. If there is anything that you want to discuss
further, please do not hesitate to contact me.
Sincerely,
Frank Khulusi
President and Chief
Executive Officer
AGREED AND ACCEPTED THIS DAY OF MAY, 1996.
-----
- -----------------------------
Richard Finkbeiner