<PAGE>

EXHIBIT 10.1


                                UWINK LETTERHEAD


August 29, 2005

Peter Wilkniss
1665 S. Euclid Avenue
San Marino, CA 91108


            RE:   EMPLOYMENT TERMS

Dear Peter:

         The purpose of this letter is to set forth the terms of employment
between uWink, Inc., a Utah corporation (the "Company"), and you ("Executive").

         1.       Duties. During the term of this Agreement, Executive shall
                  serve as the Chief Financial Officer of the Company.

         2.       Term. Executive shall be employed subject to the election of
                  both parties.

         3.       Compensation. Executive's initial base salary shall be
                  $150,000 per annum. Executive shall be eligible for an annual
                  bonus of up to 33% of his base salary upon successfully
                  achieving certain goals as specified by Company management. Up
                  to $50,000 of any annual bonus payable hereunder may be paid
                  in shares of Company common stock in lieu of cash, at the
                  option of the Company. Executive shall be eligible for a
                  pro-rated bonus for 2005 based on the number of days actually
                  worked in 2005.

         4.       Stock Options. The Company will grant Executive stock options
                  to purchase 400,000 shares of common stock, 200,000 at an
                  exercise price of $0.43 per share and 200,000 at an exercise
                  price equal to the closing price on September 15, 2005. The
                  terms of the stock options shall be as set forth in the Stock
                  Option Agreement attached hereto.

         5.       Benefits. Executive will receive all benefits, including
                  health insurance, as granted to other senior executives of the
                  Company.

         6.       Termination. It is agreed that Executive is employed at will
                  and either party may terminate this Agreement with or without
                  cause at any time upon thirty (30) days prior written notice.
                  Upon termination (except by the Company for Cause (as defined
                  below) or by Executive without Good Reason (as defined below))
                  Executive shall receive a severance payment equal to one month
                  of base salary for every 2 months worked, up to a maximum of



<PAGE>

                  12 months base salary, as well as a pro rata portion of the
                  annual bonus for the year of termination. A pro rata portion
                  of stock options for the year terminated shall also vest upon
                  such termination.

                  For purposes of this Letter Agreement, the term "Cause" shall
                  mean (i) an action or omission of the Executive which
                  constitutes a material breach of, or material failure or
                  refusal to perform his duties under, this Agreement, (ii)
                  fraud, embezzlement or misappropriation of funds during the
                  Executive's employment with the Company, or (iii) a conviction
                  of any crime during Executive's employment with the Company
                  which involves dishonesty or a breach of trust or involves the
                  Company or its executives. Any termination for Cause shall be
                  made by written notice to the Executive, which shall set forth
                  in reasonable detail all acts or omissions upon which the
                  Company is relying for the termination. The Executive shall
                  have the right to address the Company's board of directors
                  regarding the acts or omissions set forth in the notice of
                  termination.

                  For purposes of this Letter Agreement, the term "Good Reason"
                  means: (i) a reduction by the Company in Executive's base
                  salary to a rate less than the initial base salary rate set
                  forth in this Letter Agreement; (ii) a change in the
                  eligibility requirements or performance criteria under any
                  employee benefit plan or incentive compensation arrangement
                  under which Executive is covered on the effective date of this
                  Agreement, and which materially adversely affects Executive;
                  (iii) Company requiring Executive to be based anywhere other
                  than the Company's headquarters or the relocation of Company's
                  headquarters more than 20 miles from its location on the
                  effective date of this Agreement, except for required travel
                  on the Company's business to the extent substantially
                  consistent with the business travel obligations which
                  Executive undertook on behalf of the Company on the effective
                  date of this Agreement; (iv) the assignment to Executive of
                  any duties or responsibilities which are materially
                  inconsistent with Executive's status or position as a member
                  of the Company's executive management group; or (v)
                  Executive's good faith and reasonable determination, after
                  consultation with nationally-recognized counsel, that
                  Executive is being unduly pressured or required by the board
                  of directors or a senior executive of the Company to directly
                  or indirectly engage in criminal activity.

                  Upon any termination by the Company for Cause or the Executive
                  without Good Reason, the Company shall pay to the Executive
                  any due and unpaid compensation (including any bonus
                  compensation earned but unpaid) and earned but unused vacation
                  time through the date of termination.

         7.       Confidentiality and Non-Solicitation. Executive will sign the
                  attached Confidentiality and Non-Solicitation Agreement that
                  all employees of the Company are required to sign.

         8.       Indemnity. The Company shall indemnify and hold the Executive
                  harmless from any cost, expense or liability arising out of or
                  relating to any acts or decisions made by the Executive on
                  behalf of or in the course of performing services for the
                  Company to the same extent the Company indemnifies and holds
                  harmless other executive officers and directors of the Company
                  and in accordance with the Company's certificate of
                  incorporation, bylaws and established policies.



<PAGE>

         9.       Governing Law. This Agreement shall be governed by the laws of
                  the State of California.


         If you agree with the foregoing, please execute in the space provided
below. We look forward to a long and rewarding relationship.


                                    UWINK, INC.

                                    By: /s/ NOLAN BUSHNELL
                                        ---------------------------------
                                        Nolan Bushnell
                                        Chief Executive Officer


                                    By: /s/ PETER WILKNISS
                                        ---------------------------------
                                        Peter Wilkniss
                                        Executive