Exhibit 10.1
August 20, 2007
Mr. Robin Easton
1509 85th Avenue NE
Clyde Hill, WA 98004
Dear Robin,
On behalf of Blue Nile, Inc. (the “Company”), I am pleased to offer you the
position of Chief Financial Officer, reporting to Diane Irvine. The terms of
your relationship with the Company will be as indicated herein.

  1.   Position. You will become the Chief Financial Officer for the Company. As
such, you will have responsibilities as determined by the President.     2.  
Base Salary. You will be paid a monthly salary of $16,667 less payroll
deductions and all required withholdings, which represents an annualized rate of
$200,000. Your wage will be payable in accordance with the Company’s standard
payroll policies. The Company may modify your compensation from time to time as
it deems necessary.     3.   Performance Bonus. You will be paid an annual
performance bonus with a target payout of $100,000. Your performance bonus can
range from 0% to 200% of target based on the performance of the Company and your
individual performance against key objectives. This bonus amount will be
prorated for 2007 based on the number of months you are employed by the Company
(employment for a partial month will be calculated as if employed for the full
month).     4.   Stock Options. We will recommend to the Board of Directors or
Subcommittee thereof, that you be granted the greater of: (1) a non-statutory
stock option to purchase 30,000 shares of common stock of the Company; or (2) a
non-statutory stock option valued at $925,000 on the date of grant (your
starting date), such value to be calculated based upon the Company’s per share
Black-Scholes methodology for expensing its stock options (utilizing the
assumptions the Board or Subcommittee determines at or before the date of
grant). The exercise price of your stock option will be the closing sales price
(or the closing bid, if no sales were reported) as quoted on the NASDAQ National
Market on the last market trading day prior to the date of grant. One fourth
(1/4) of the shares subject to such option will vest on the first year
anniversary of your hire date and one forty-eighth (1/48) of the shares subject
to such option will vest each month thereafter as long as your employment
continues with the Company. The Company’s 2004 Equity Incentive Plan, the Grant
Notice and the Stock Option Agreement shall govern the terms of this option
grant in all respects.     5.   Benefits. You will be eligible to receive
healthcare and dental benefits, life and disability insurance, transportation
allowance, and a 401(k) plan effective on the first of the month following your
date of hire. The Company may modify your benefits from time to time as it deems
necessary.     6.   Standard Employee Agreement. As a condition to your
employment, you are required to sign and comply with the Company’s standard
Employee Nondisclosure, Proprietary Information, Inventions, Nonsolicitation and
Noncompetition Agreement relating to the protection of the Company’s proprietary
and confidential information and assignment of inventions. In addition, you will
be required to abide by the Company’s strict policy that prohibits any new
employee from using or bringing with him or her from any previous employer any
confidential information, trade secrets, or proprietary materials or processes
of such former employer.     7.   Employee Handbook. As a Company employee, you
will be expected to abide by the Company’s rules and

 

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      standards. You further understand that you will be required to acknowledge
and sign that you have received a copy of the Company’s Employee Handbook and
that you understand the Company’s policies set forth in the Company’s Employee
Handbook.     8.   Federal Immigration Law. For purposes of federal immigration
law, you will be required to provide to the Company documentary evidence of your
identity and eligibility for employment in the United States. Such documentation
must be provided to us within three (3) business days of your date of hire, or
our employment relationship with you may be terminated.     9.   At-Will
Employment. Your employment is at-will, as defined under applicable law. This
means you may voluntarily quit at any time, for any reason or for no reason,
simply by notifying the Company. Likewise, the Company may terminate your
employment at any time, for any reason or for no reason, with or without cause
or advance notice. This at-will employment relationship cannot be changed except
in a writing signed by a Company officer.     10.   Entire Agreement. This
Agreement, together with your Employee Nondisclosure, Proprietary Information,
Inventions, Nonsolicitation and Noncompetition Agreement, constitutes the
complete and exclusive statement of your employment agreement with the Company.
The employment terms in this letter supersede any other agreements or promises
made to you by anyone, whether written or oral.     11.   Start Date. To be
determined.

Again, let me indicate how pleased we all are to extend this offer, and how much
we look forward to working together. Please indicate your acceptance by signing
and returning the enclosed copy of this letter.

          Very truly yours,
Blue Nile Inc.
      /s/ Mark Vadon           Mark Vadon, CEO       

The foregoing terms and conditions are hereby accepted:

                Signed:  /s/ Robin Easton         Robin Easton   

Dated:       8/20/2007