Exhibit 10.1

 

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February 9, 2005

 

Mr. Rick Frier

 

Dear Rick:

 

The purpose of this letter is to outline the terms of our offer for employment.
I am pleased to offer you a position to join our Corporate Executive Team.
Initially, you will hold the position of Executive Vice President, Finance and
Accounting with the commitment that you will transition to the position of
Executive Vice President and Chief Financial Officer upon the conclusion of a
transition period which will be complete no later than five (5) days after the
filing of the Company’s annual report for fiscal year ending March 31, 2005 with
the Securities and Exchange Commission. You will be working out of the St.
Petersburg, Florida corporate office reporting to me. We expect that you will
start on or about March 7, 2005, with a base salary of $12,884.62 per pay
period, paid biweekly, annualized at $335,000.

 

You are also eligible to receive an annual target bonus of 65% of your annual
base salary, which is based upon the performance of the Company and will be
influenced by your performance against objectives set by the Company. You will
have the opportunity to earn up to 1.5 times your annual target bonus amount.
The current practice is that bonuses are paid after the fiscal year has ended
and you must be an employee at the time of payment to be eligible. You will be
eligible to begin participation in the annual bonus plan effective April 1, 2005
for the fiscal year ending March 31, 2006. In addition, you will receive a
sign-on bonus of $40,000 payable on the date you receive your first bi-weekly
pay check.

 

You will receive, subject to the approval of the Compensation Committee of the
Board of Directors’, a new hire stock option grant of 150,000 shares of common
stock at the then fair market value determined at the first regularly scheduled
meeting of the Compensation Committee which is held subsequent to your date of
hire. These options will vest over 4 years at 25% per year beginning on the date
the Compensation Committee approves the award. I am also pleased to inform you
that at this position you would be eligible for consideration for allocations of
additional equity which could be in the form of stock options and/or other forms
of long term incentives as may be provided by the company and that the review
for award consideration is usually made at the time following the next annual
meeting of stockholders.

 

Your relocation to St. Petersburg, Florida will be supported by the Company
pursuant to the terms of the attached relocation package. Reimbursement will
only be made for actual incurred expenses that are eligible within Catalina’s
relocation guidelines and within the stated time period. If you resign within
one (1) year from the date of employment, or your employment is terminated for
cause during such period, you will be required, upon termination, to reimburse
Catalina Marketing for all relocation assistance provided by the Company.

 

As a condition of employment, you are required to execute the Company’s standard
Confidentiality Agreement. A copy of the Confidentiality Agreement is enclosed
with this letter.

 

It is agreed that you would receive a special separation benefit of base salary
continuation or lump sum payout (at the Company’s discretion) should your
employment be terminated by Catalina Marketing under certain conditions
specified below. This benefit would pay an amount equal to the base salary you
would have received over the following twelve (12) month period had your
employment not been terminated. These separation benefits would be contingent
upon signing a release satisfactory to the Company. You would not be eligible
for payout of this benefit if your employment were terminated for Cause. Cause
may include, but is not limited to,

 

 

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conviction of a felony, actions against the Company that disparage, harm or
injure the Company in any material way, violation of the Employee
Confidentiality Agreement, material violations of stated Company policies and
repeated failure to perform the duties of your position after written
notification. In addition, we are providing you with a separate Change of
Control agreement, a form of the agreement is attached hereto. This Change of
Control agreement defines the separation benefits that apply under Change of
Control, as that term is defined in the agreement.

 

Your insurance benefits will be effective the first of the month following one
month of employment – May 1, 2005. The Human Resources Department will be
pleased to review our benefits program with you and answer any questions. You
will also be eligible to participate in the Catalina Executive Annual Physical
program. In addition, you are also entitled to receive four weeks of vacation
per year until such time as the standard Company policy would provide a greater
benefit. Catalina will also reimburse you for actual incurred financial planning
and/or tax preparation expenses up to $5,000 annually.

 

On your first day of work, you will need to furnish identification to verify
your right to work in the United States. (Most employees provide a social
security card and a valid driver’s license).

 

Catalina Marketing is a Drug-Free Workplace. As a candidate, you are required to
submit to a urinalysis at a laboratory chosen by Catalina Marketing within five
business days of receiving this letter, and by signing below, release Catalina
Marketing Corporation and any of its subsidiaries from liability. Enclosed is a
Chain of Custody form and instructions on the drug testing procedures. This
offer of employment is contingent upon our receiving a negative drug test
result.

 

Because Catalina Marketing Corporation is an “At Will” employer, please
understand that the length of your employment is not guaranteed. Either party
has the ability to terminate the relationship at any time for any reason. This
represents the complete agreement between you and Catalina Marketing Corporation
regarding the subject of job tenure.

 

You hereby represent and warrant (i) that your acceptance and performance under
this Offer Letter will not violate any other agreements or arrangements that you
have entered into with any other individual or entity, whether written or oral;
and (ii) that you have and will continue to have the full right, power and
authority to accept the terms of this offer letter and perform the services
hereunder.

 

If you are agreeable to the above terms, please sign the enclosed copy of this
letter and return it by facsimile to Human Resources at [XXXXX] and mail an
original in the enclosed envelope to Human Resources by February 14, 2005.

 

Rick, I am truly excited about your candidacy. I believe we are building a
committed, experienced, and energized executive team. On behalf of Catalina
Marketing Corporation and the Executive Team, we hope you will be part of our
future!

 

Sincerely,

    

ACCEPTANCE:

/s/ Dick Buell

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/s/ Rick Frier

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Dick Buell

CEO

     Rick Frier     

 

February 11, 2005

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