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EXHIBIT 10.1
[HARISTON LETTERHEAD]
March 5, 1996
Xx. Xxxxx X. Xxxxx
00 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Dear Xxx:
On behalf of Hariston Corporation, and its wholly-owned subsidiary, EDUCORP
Direct (the "Company"), I would like to offer to you the position of President
of EDUCORP Direct, pursuant to the following terms, and subject to the formal
approval of these terms by Xxxxxxxx'x Board of Directors at the next Board
meeting scheduled for Tuesday, March 12, 1996.
As President of EDUCORP Direct, your initial base compensation will be $125,000
per year although it is understood and expected that your base will increase in
subsequent years, subject to the Company's performance. You will report to me
and will be responsible for the management and performance of EDUCORP Direct.
A bonus plan will be implemented whereby you can earn up to 50% of your base
compensation ($62,500 in the first year) on an annual basis. The plan, which
will be prepared with your input and agreement, will compensate you based on
your achievement of EDUCORP Direct's operating budget and certain non-financial
goals, including customer list growth, implementation of an MIS system,
establishment of business to business sales capabilities, and employee
productivity. The bonus plan will also take into consideration budget
variances for capital expenditures and the effect of any currently
unanticipated strategic decisions.
With regard to benefits, EDUCORP Direct will provide you with an "allowance" of
up to $16,000 per year to pay for airfare between San Francisco and San Diego,
and an apartment in the San Diego area, as long as you continue to maintain
your primary residence in Sausalito. Should you relocate to the San Diego
area, the Company will reimburse you for reasonable moving expenses not to
exceed $3,000. The travel and apartment expenses will be paid directly by the
Company.
You will also be provided with medical insurance and any other benefits that
are offered to all other employees. EDUCORP Direct will consider extending
medical coverage to "significant others" based on the demands for this added
benefit by the Company's employees.
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March 5, 1996
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As President of the Company, EDUCORP Direct will reimburse you for any
reasonable out-of-pocket expenses that you incur in the course of your
employment. You will also be granted four (4) weeks of paid vacation per
year. This paid vacation will accrue at the rate of one week per quarter. If
the Company has not already done so, it will soon change its policy such that
this benefit must be used before the end of the first quarter following the
subject year or it will be lost.
As you know, it is our intention to legally separate EDUCORP Multimedia, the
parent corporation of EDUCORP Direct, from Hariston. This restructuring will
result in EDUCORP Multimedia becoming a publicly-traded company. Assuming this
restructuring does take place as planned on or before July 30, 1996, you will be
granted stock options at the same price as other executives equal to 2.5% of
EDUCORP Multimedia's outstanding common stock, as measured prior to a public
secondary offering or a size-equivalent offering on a private basis. Subject
to legal and tax constraints, we will endeavor to minimize the exercise price
of these options which shall vest on a monthly basis over a four year term.
The underlying shares, like those of all other executives, will be subject to
the Rule 144 holding period.
If for any reason, EDUCORP Multimedia is unable to be separated from Hariston,
we anticipate emigrating Hariston to the United States and subsequently merging
the emigrated entity with EDUCORP Multimedia. Under these circumstances your
options will be assumed by the new entity under terms and conditions that will
result in your owning options to purchase 250,000 shares of the merged public
entity at an exercise price, and with a vesting schedule, similar to those of
the current executive officers.
In either event your options will become fully vested upon the sale of EDUCORP
Multimedia to an unrelated third party. A draft copy of the option plan and
your agreement is being sent under separate cover.
Your employment with EDUCORP Direct is on an at-will basis. Accordingly,
employment is for no specified term and may be terminated by either the Company
or you at any time with or without cause or notice. Any modification, waiver,
or amendment to your employment on an at-will basis must be in writing and must
be signed by the President of Hariston, or in the event of its successful
restructuring, EDUCORP Multimedia, and by you.
In the event that your employment is terminated without cause at any time in
the future, you will receive severance compensation equal to three (3) months
pay plus any accrued vacation.
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March 5, 1996
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If the foregoing is acceptable to you, please indicate your acceptance of this
offer with your signature below.
We look forward to your joining the team and helping us build a major company
in the multimedia industry.
Sincerely,
X.X. XxXxxxxxx
X.X. XxXxxxxxx
President and CEO
AGREED, on this date 5 - March - 1996
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Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
