<PAGE>
                                                                   EXHIBIT 10.01
                                                                   -------------

                                                              As of May 17, 1999

Mr. Henley "Jr." Regisford
10610 Lurline Avenue
Chatsworth, CA 91311

Dear Junior,

This letter confirms the terms of your employment by Modern Records, Inc.
hereinafter termed (the "Employer").

1.   Term
     ----

     The term of your employment hereunder commences as of May 24, 1999, and
     expires on March 13, 2002, unless earlier terminated as hereinafter
     provided (the "term").

2.   Salary
     ------

     In full consideration for all rights and services provided by you
     hereunder, you shall receive an annual salary of $125,000 for the first
     year, $140,000 for the second year and $160,000 for the third year of the
     term. Salary payments shall be made in equal installments in accordance
     with Employer's then prevailing payroll policy.

3.   Bonus
     -----

     Bonus compensation, if any, shall be at the discretion of the Employer.

4.   Stock Options
     -------------

     Employer shall recommend to the Compensations Committee of the Board of
     Directors of Modern Records that you be granted non-qualified stock options
     pursuant to a stock option or stock incentive plan of Modern Records to
     purchase 25,000 shares of common stock of Modern Records, it being
     understood that such options shall have an exercise price of 100% of fair
     market value of the common stock of Modern Records at the date of grant by
     the Committee (the "Grant Date") and that such options shall vest at the
     rate of 5,000 shares immediately, 10,000 shares upon your first anniversary
     of the Grant Date and 10,000 shares on your second anniversary of the Grant
     Date (subject to your continued employment by Employer and to the other
     provisions of the applicable stock option or stock incentive plan).

5.   Title/Reporting
     ---------------

     You are being employed hereunder in the position of Vice President, Artist
     and Repertoire and will report directly to Randy Jackson.
<PAGE>

6.   Duties
     ------

     You shall personally and diligently perform, on a full-time and exclusive
     basis, such services as Employer or any of its divisions may reasonably
     require. You shall observe all reasonable rules and regulations adopted by
     Employer in connection with the operation of its business and carry out to
     the best of your ability all instructions of Employer.

7.   Expenses
     --------

     To the extent you incur necessary and reasonable business expenses
     (including, without limitation, travel [business class flights when in
     excess of 3 hours) and entertainment], in the course of your employment,
     you shall be reimbursed for such expenses, subject to Employer's then
     current policies regarding reimbursement of such business expenses.

8.   Other Benefits
     --------------

     You shall be entitled to those benefits that are standard for persons in
     similar positions with Employer, including paid vacation and medical
     coverage.

9.   Protection of Employer's Interests
     ----------------------------------

     During the term of your employment by Employer you will not compete in any
     manner, directly or indirectly, whether as a principal, employee, agent or
     owner, with Employer, Modern Records, or any affiliate thereof, except that
     the foregoing will not prevent you from holding at any time less than 5% of
     the outstanding capital stock of any company whose stock is publicly
     traded. To the extent permitted by law, all rights worldwide with respect
     to any and all intellectual or other property of Entertainment produced,
     created or suggested by you during the term of your employment or resulting
     from your services shall be deemed to be a work made for hire and shall be
     the sole and exclusive property of Employer. You agree to execute,
     acknowledge and deliver to Employer at Employer's request, such further
     documents as Employer finds appropriate to evidence Employer's rights in
     such property. Any confidential and/or proprietary information of Employer,
     Modern Records or any affiliate thereof shall not be used by you or
     disclosed or made available by you to any person except as required in the
     course of your employment, and upon expiration or earlier termination of
     the term of your employment, you shall return to Employer all such
     information that exists in written or other physical form (and all copies
     thereof) under your control. Without limiting the generality of the
     foregoing, you acknowledge signing and delivering to Employer, Modern
     Records Confidentiality Agreement and Modern Records Statement of Policy
     Regarding Conflicts of Interest and Business Ethics and Questionnaire
     Regarding Compliance and you agree that all terms and conditions contained
     therein, shall be deemed, and hereby are, incorporated into this agreement
     as if set forth in full herein. The provisions of the immediately preceding
     four

                                       2
<PAGE>

     sentences of this paragraph shall survive the expiration of earlier
     termination of this agreement.

10.  Services Unique
     ---------------

     You recognize that your services hereunder are of a special, unique,
     unusual, extraordinary and intellectual character giving them a peculiar
     value, the loss of which cannot be reasonably or adequately compensated for
     in damages, and in the event of a breach of this agreement by you
     (particularly, but without limitation, with respect to the provisions
     hereof relating to the exclusivity of your services and the provisions of a
     paragraph 10 hereof), Employer shall, in addition to all other remedies
     available to it, be entitled to equitable relief by way of injunction and
     any other legal or equitable remedies.

11.  Termination
     -----------

     (a)  Employer may terminate your employment hereunder for gross negligence,
          misconduct, nonfeasance or breach of this agreement or for other good
          cause, and in any such event all obligations of Employer hereunder
          shall immediately terminate. Employer must pay salary, expense
          reimbursements, vacation through date of termination.

     (b)  In the event of your death during the term hereof, this agreement
          shall terminate and Employer shall only be obligated to pay your
          estate or legal representative the salary provided for herein to the
          extent earned by you prior to such event. In the event you are unable
          to perform services required of you hereunder as a result of any
          disability and such disability continues for a period of 90 days or
          more consecutive days or an aggregate of 120 or more days during any
          12-month period during the term hereof, then at any time thereafter
          Employer shall have the right, at its option, to terminate your
          employment hereunder. Unless and until so terminated, during any
          period of disability during which you are unable to perform the
          services required of you hereunder, your salary hereunder shall be
          payable to the extent of, and subject to, Employer's policies and
          practices then in effect with regard to sick leave and disability
          benefits.

     (c)  You acknowledge that you have been provided by Employer with a copy of
          Section 508 of the Federal Communications Act of 1934, as amended,
          relating in part to receiving or paying consideration for product
          identification in television programs, that you are familiar with the
          provisions thereof and that you will fully comply therewith during the
          term of this agreement. Without limiting the foregoing, however, and
          whether or not Section 508 is applicable to your activities, you agree
          that you will not without Employer's prior written consent, accept any
          compensation or gift, from ant person, firm or corporation (other than
          Employer) where such compensation of gift is, or may appear to be, in

                                       3
<PAGE>

          consideration of your acting in a particular manner in relation to the
          business of such person, firm or corporation. Without limiting the
          generality of paragraph 12 (a) hereof, it is agreed that in any
          violation of this paragraph 12 (c) shall constitute a violation of
          this agreement upon which Employer may forthwith terminate this
          agreement pursuant to paragraph 12 (a) hereof.

12.  Use of Employee's Name
     ----------------------

     Employer shall have the right but not the obligation to use your name or
     likeness for any publicity or advertising purpose. Employer is under no
     obligation to accord you credit for any production.

13.  Assignment
     ----------

     Employer may assign this agreement or all or any part of its rights
     hereunder to Modern Records or to any entity that succeeds to a substantial
     portion of Employer's assets or that Employer or Modern Records may own
     substantially, and this agreement shall inure to the benefit of such
     assignee.

14.  No Conflict with Prior Agreements
     ---------------------------------

     You represent to Employer that neither your commencement of employment
     hereunder nor the performance of your duties hereunder conflicts with any
     contractual commitment on your part to any third party or violates or
     interferes with any rights of any third party.

15.  Post-Termination Obligations
     ----------------------------

     After the expiration or earlier termination of your employment hereunder
     for any reason whatsoever you shall not either alone or jointly, with or on
     behalf of others, either directly or indirectly, whether as a principal,
     partner, agent, shareholder, director, employee, consultant or otherwise,
     at anytime during a period of one year following such expiration or
     termination (the "Commitment Period"), offer employment to, or solicit the
     employment or engagement of, or otherwise entice away from the employment
     of Employer or any affiliated entity, either for your own account or for
     any other person, firm or company, any person who is or has been employed
     by Employer or any such affiliated entity at any time during the Commitment
     period, whether or not such person would commit any breach of his/her
     contact of employment by reason of his leaving the service of Employer or
     any affiliated entity.

16.  Entire Agreement; Amendments; Waiver. Etc.
     -----------------------------------------

(a)  This agreement supersedes all prior or contemporaneous agreements and
     statements, whether written or oral, concerning the terms of your
     employment, and no amendment or

                                       4
<PAGE>

     modification of this agreement shall be binding against Employer unless set
     forth in a writing signed by Employer and delivered to you. No waiver by
     either party of any breach by the other party of any provision or condition
     of this agreement shall be deemed a waiver of any similar or dissimilar
     provision or condition at the same or any, prior or subsequent time.

(b)  You have been given no indication, representation or commitment of any
     nature to any broker, finder, agent or other third party to the effect that
     any fees or commissions of any nature are, or under any circumstances might
     be, payable by Employer in connection with your employment hereunder.

(c)  Nothing herein contained shall be construed so as to require the commission
     of any act contrary to law, and wherever there is any conflict between any
     provision of this agreement and any present or future statute, law,
     ordinance or regulation, the latter shall prevail, but in such event the
     provision of this agreement affected shall be curtailed and limited to the
     extent necessary to bring it within legal requirements. Without limiting
     the generality of the foregoing, in the event any compensation or other
     monies payable hereunder shall be in excess of the amount permitted by any
     statute, law, ordinance, regulation or wage guideline which may be in
     effect at any time of from time to time, payment of the maximum amount then
     allowed thereby shall constitute full compliance of this agreement.

(d)  This agreement does not constitute a commitment of Employer with regard to
     your employment, express or implied, other than to the extent expressly
     provided for herein. Upon termination of this agreement, it is the
     contemplation of both parties that your employment with Employer shall
     cease, and that neither Employer nor you shall have any obligation to the
     other with respect to continued employment.  In the event that your
     employment continues for any period of time following the stated expiration
     date of this agreement, unless and until agreed to in a new subscribed
     written document, such employment or any continuation thereof is "at will",
     and may be terminated without obligation at any time by either party's
     giving notice to the other.

(e)  This agreement shall be governed by and construed in accordance with the
     laws of the state of California. In accordance with the immigration Reform
     and Control Act of 1986, employment hereunder is conditioned upon
     satisfactory proof of your identity and legal ability to work in the United
     States.

(f)  To the extent permitted by law, you will keep the terms of this agreement
     confidential, and you will not disclose any information concerning this
     agreement to anyone other than your immediate family and profession
     representation (provided they also agree to keep the terms of this
     agreement confidential).

                                       5
<PAGE>

19.  Notices
     -------

     All notices that either party is required or may desire to give the other
     shall be in writing and given either personally or by depositing the same
     in the United States mail addressed to the party to be given notices as
     follows:

     To Employer:        Modern Records
                         468 N. Camden Drive
                         3rd Floor
                         Beverly Hills, CA 90210

     To you:             Henley Regisford, Jr.
                         10610 Lurline Avenue
                         Chatsworth, CA 91311

Either party may by written notice designate at a different address for giving
of notices. The date of mailing of any such notices shall be deemed to be the
date on which such notice is given.

20.  Headings
     --------

The headings set forth herein are included solely for the purpose of
identification and shall not be used for the purpose of construing the meaning
of the provisions of this agreement.

If the foregoing accurately reflects our mutual agreement, please sign where
indicated.

                                  MODERN RECORDS, INC.


                                  By:    /s/ Randy Jackson
                                       ---------------------------------------
                                           Randy Jackson (President, CEO)


By    /s/ Henley Regisford, Jr.
   ---------------------------------
       Employee Signature

           Henley Regisford, Jr.
   ---------------------------------
       Employee (printed or typed)

                                       6