Document:

<PAGE>   1
                                                                    EXHIBIT 10.6

CB  RICHARD ELLIS
SUBLEASE
CB Richard Ellis, Inc.
Brokerage and Management
Licensed Real Estate Broker

1.      PARTIES.
        This Sublease, dated August 31, 1999, is made between A & M Warehouses,
        Inc. (Sublessor), and 800.COM, Inc. (Suble

2.      MASTER LEASE.
        Sublessor is the lessee under a written lease dated November 24, 1998,
        wherein INVESCO Realty Advisors leased to Sublessor the real property
        located in the City of Portland, County of Multnomah State of Oregon,
        described as an approximate 523,000 square foot warehouse building
        located at # No. Ramsey Boulevard ("Master Lease"). Said lease has been
        amended by the following amendments said leases and amendments are
        herein collectively referred to as the "Master Lease" and are attached
        hereto as Exhibit "A".

3.      PREMISES.
        Sublessor hereby subleases to Sublessee on the terms and conditions set
        forth in this Sublease the following portion of the Master Premises
        ("Premises"): Approximately 210,000 square feet located in the northwest
        corner of the premises as depicted on Exhibit A-1 and A-2 ("Master
        Premises").

4.      WARRANTY BY SUBLESSOR.
        Sublessor warrants and represents to Sublessee that the Master Lease has
        not been amended or modified except as expressly set forth herein, that
        Sublessor is not now, and as of the commencement of the Term hereof will
        not be, in default or breach of any of the provisions of the Master
        Lease, and that Sublessor has no knowledge of any claim by Lessor that
        Sublessor is in default or breach of any of the provisions of the Master
        Lease.

5.      TERM.
        The Term of this Sublease shall commence on September 27, 1999,
        ("Commencement Date"), or when Lessor consents to this Sublease (if such
        consent is required under the Master Lease), whichever shall last occur,
        and end on March 31, 2001 ("Termination Date"), unless otherwise sooner
        terminated in accordance with the provisions of this Sublease. In the
        event the Term commences on a date other than the Commencement Date,
        Sublessor and Sublessee shall execute a memorandum setting forth the
        actual date of commencement of the Term. Possession of the Premises
        ("Possession") shall be delivered to Sublessee on the commencement of
        the Term. If for any reason Sublessor does not deliver Possession to
        Sublessee on the commencement of the Term, Sublessor shall not be
        subject to any liability for such failure, the Termination Date shall
        not be extended by the delay, and the validity of this Sublease shall
        not be impaired, but rent shall abate until delivery of Possession.
        Notwithstanding the foregoing, if Sublessor has not delivered Possession
        to Sublessee within thirty (30) days after the Commencement Date, then
        at any time thereafter and before delivery of Possession, Sublessee may
        give written notice to Sublessor of Sublessee intention to cancel this
        Sublease. Said notice shall set forth an effective date for such
        cancellation which shall be at least ten (10) days after delivery of
        said notice to Sublessor. If Sublessor delivers Possession to Sublessee
        on or before such effective date, this Sublease shall remain in full
        force and effect. If Sublessor fails to deliver Possession to Sublessee
        on or before such effective date, this Sublease shall be canceled, in
        which case all consideration previously paid by Sublessee to Sublessor
        on account of this Sublease shall be returned to Sublessee, this
        Sublease shall thereafter be of no further force or effect, and
        Sublessor shall have no further

                                                                          PAGE 1
<PAGE>   2
        liability to Sublessee on account of such delay or cancellation. If
        Sublessor permits Sublessee to take Possession prior to the commencement
        of the Term, such early Possession shall not advance the Termination
        Date and shall be subject to the provisions of this Sublease, including
        without limitation the payment of rent.

6.      RENT.
        6.1 Minimum Rent. Sublessee shall pay to Sublessor as minimum rent,
        without deduction, set off, notice, or demand, at 5002 D Street NW
        Auburn, WA 98001 or at such other place as Sublessor shall designate
        from time to time by notice to Sublessee. If the Term begins or ends on
        a day other than the first or last day of a month, the rent for the
        partial months shall be pro rated on a per diem basis. Additional
        provisions:

        SEE RENT SCHEDULE PER ADDENDUM A.

        6.2 Operating Costs. If the Master Lease requires Sublessor to pay to
        Lessor all or a portion of the expenses of operating the building and/or
        project of which the Premises are a part ("Operating Costs"), including
        but not limited to taxes, utilities, or insurance, then Sublessee shall
        pay to Sublessor as additional rent forty and two tenths percent (40.2%)
        of the amounts payable by Sublessor for Operating Costs incurred during
        the Term. Such provides for the payment by Sublessor of Operating Costs
        on the basis of an estimate thereof, then as and when adjustments
        between estimated and actual Operating Costs are made under the Master
        Lease, the obligations of Sublessor and Sublessee hereunder shall be
        adjusted in a like manner; and if any such adjustment shall occur after
        the expiration or earlier termination of the Term, then the obligations
        of Sublessor and Sublessee under this Subsection 6.2 shall survive such
        expiration or termination. Sublessor shall, upon request by Sublessee,
        furnish Sublessee with copies of all statements submitted by Lessor of
        actual or estimated Operating Costs during the Term.

        Sublessee shall be obligated to pay only its prorata share of those
        costs paid by the Sublessor to Lessor as "Expenses" under the master
        Lease, and in no event shall Sublessee be obligated to pay to Sublessor
        any additional costs, fees or other charges that are not paid by
        Sublessor to Master Lessor as "Expenses" under the Master Lease. Within
        twenty (20) days of Sublessor's receipt of any statement, including
        without limitation the annual accounting statement, received from the
        Lessor with respect to Operating Costs, (which costs the Master Lease
        Defines as "Expenses"), Sublessor will deliver such statement to
        Sublessee. Sublessee shall have the same rights as granted to Sublessor
        in the Master Lease to dispute any item or amount included in Operating
        Costs, which shall be given by written notice to Sublessor within twenty
        (20) days of receipt of the annual accounting statement for such costs.
        Notwithstanding any provision to the contrary contained in the Sublease
        or in the Master Lease, and regardless of the definition of "Expenses"
        in the Master Lease, as between Sublessee and Sublessor under this
        Sublease, Sublessee shall not be obligated to pay its own prorata share
        of, and Operating Costs hereunder shall not include costs with respect
        to any of the following items: (1) repairs, restoration or other work
        occasioned by fire, wind or other casualty; (2) income and franchise
        taxes of Lessor or Sublessor; (3) expenses incurred in leasing to or
        procuring of tenants, leasing commissions, advertising and marketing
        expenses and expenses for the renovating of space leased to tenants; (4)
        interest or principal payments on any mortgage or other indebtedness or
        rent under any ground lease; (5) costs to construct the budding or costs
        incurred in order to repair defects in such construction; (6) expenses
        incurred in disputes with other tenants or due to Landlord's violation
        of any other lease in the building; (7) any penalties, interest or other
        charges due to late payment of any sums or due to negligence or wrongful
        conduct; (8) any capital cost or expense to the extent that it is paid
        or reimbursed from any person (other than as payment for Expenses),
        including costs reimbursed by warranty, insurance, service contracts,
        condemnation proceeds or otherwise; (10) any cost representing an amount
        paid to a person, firm, corporation or other entity related to Lessor
        that is in excess of the amount that would have been paid on a arms
        length basis in the absence of such relationship; (11) the

                                                                          PAGE 2
<PAGE>   3

        cost of curing any violation of any law, ordinance or regulation or of
        remediating any environmental condition (unless caused by Sublessee); or
        (12) costs incurred in connection with the sale, financing, refinancing,
        selling or change of ownership of the building or any part thereof.

7.      SECURITY DEPOSIT.
        Sublessee shall deposit with Sublessor upon execution of this Sublease
        the sum of Eighty-Seven Thousand Seven Hundred Fifty-Eight and No/100
        Dollars ($87,758.00) as security for Sublessee's faithful performance of
        Sublessee's obligations hereunder ("Security Deposit"). If Sublessee
        fails to pay rent or other charges when due under this Sublease, or
        fails to perform any of its other obligations hereunder, Sublessor may
        use or apply all or any portion of the Security Deposit for the payment
        of any rent or other amount then due hereunder and unpaid, for the
        payment of any other sum for which Sublessor may become obligated by
        reason for Sublessee default or breach, or for any loss or damage
        sustained by Sublessor as a result of Sublessee's default or breach. If
        Sublessor so uses any portion of the Security Deposit, Sublessee shall,
        within ten (10) days after written demand by Sublessor, restore the
        Security Deposit to the full amount originally deposited, and Sublease's
        failure to do so shall constitute a default under this Sublease.
        Sublessor shall not be required to keep the Security Deposit separate
        from its general accounts, and shall have no obligation or liability for
        payment of interest on the Security Deposit. In the event Sublessor
        assigns its interest in this Sublease, Sublessor shall deliver to its
        assignee so much of the Security Deposit as is then held by Sublessor.
        Within ten (10) days after the Term has expired, or Sublessee has
        vacated the Premises, or any final adjustment pursuant to Subsection 6.2
        hereof has been made, whichever shall last occur, and provided Sublessee
        is not then in default of any of its obligations hereunder, the Security
        Deposit, or so much thereof as had not theretofore been applied by
        Sublessor, shall be returned to Sublessee or to the last assignee, if
        any, of Sublessee's interest hereunder.

8.      USE OF PREMISES.
        The Premises shall be used and occupied only for general office use and
        storage of and processing orders for electronics and other consumer
        products per applicable Rivergate district zoning, and for no other use
        or purpose.

9.      ASSIGNMENT AND SUBLETTING.
        Sublessee shall not assign this Sublease or further sublet all or any
        part of the Premises without the prior written consent of Sublessor (and
        the consent of Lessor, if such is required under the terms of the Master
        Lease), which shall not be unreasonably withheld and shall be processed
        in accordance with the process in the Master Lease.

10.     OTHER PROVISIONS OF SUBLEASE.
        All applicable terms and conditions of the Master Lease are incorporated
        into and made a part of this Sublease as if Sublessor were the lessor
        thereunder, Sublessee thereunder, and the Premises the Master Premises.
        With respect to the relationship between the Sublessor and the
        Sublessee, this Sublease will govern any conflict that may arise between
        the Sublease and the Master Lease. Sublessee assumes and agrees to
        perform the lessee obligations under the Master lease during the Term to
        the extent that such obligations are applicable to the Premises, except
        that the obligation to pay rent to Lessor under the Master lease shall
        be considered performed by Sublessee to the extent and in the amount
        rent is paid to Sublessor in accordance with Section 6 and Addendum A of
        this Sublease. Sublessee shall not commit or suffer any act or omission
        that will violate any of the provisions of the Master Lease. Sublessor
        shall exercise due diligence in attempting to cause Lessor to perform
        its obligations under the Master Lease for the benefit of Sublessee and
        shall use diligent efforts to obtain consents of Lessor required under
        the Master Lease. If the Master Lease terminates, this Sublease shall
        terminate and the parties shall be relieved of any further liability or
        obligation under this Sublease, provided however, that if the Master
        Lease terminates as a result of a default or breach by Sublessor or
        Sublessee under this Sublease and/or the Master Lease, then the
        defaulting party shall be liable to the non-defaulting party

                                                                          PAGE 3
<PAGE>   4

        for the damage suffered as a result of such termination. Notwithstanding
        the foregoing, if the Master Lease gives Sublessor any right to
        terminate the Master Lease in the event of the partial or total damage,
        destruction, or condemnation of the Master Premises or the building or
        project of which the Master Premises are a part, the exercise of such
        right by Sublessor shall not constitute a default or breach hereunder.

        Sublessor represents and warrants that the copy of the Master Lease
        provided to Sublessee is a true, complete and accurate copy of the
        Master Lease, and that Sublessor has the right, title, and authority to
        enter into this Sublease and to sublease the Premises to Sublessee,
        subject to obtaining the consent to Lessor. Sublessor agrees to keep the
        Master Lease I full force and effect throughout the full term of this
        Sublease, to perform all of its covenants and obligations thereunder (
        (including without limitation the prompt and timely payment of all
        amounts payable to it pursuant to the terms of the Master Lease) to
        permit or suffer no amendment or modification thereto without the
        consent of the Sublessee and to do not act and to make no omission which
        might create a default or might occasion or permit the termination
        thereof. Sublessor shall not assign its interest under the Master Lease
        without written notice of such assignment to Sublessee. Sublessor shall
        deliver copies of all notices, including without limitation notices of
        default, given to or received from Lessor under the Master Lease, and
        Sublessee shall have the right, but not the obligation, to cure any
        default by Sublessor under the Master Lease, and to deduct from Rent any
        amounts reasonably paid in doing so.

11.     ATTORNEYS FEES.
        If Sublessor, Sublessee, or Broker shall commence an action against the
        other arising out of or in connection with this Sublease, the prevailing
        party shall be entitled to recover its costs of suit and reasonable
        attorneys fees.

12.     AGENCY DISCLOSURE.
        Sublessor and Sublessee each warrant that they have dealt with no other
        real estate broker in connection with this transaction except CB RICHARD
        ELLIS, INC., who represents Sublessor and Norris, Beggs & Simpson, who
        represents Sublessee. In the event that CB RICHARD ELLIS, INC.
        represents both Sublessor and Sublessee, Sublessor and Sublessee hereby
        confirm that they were timely advised of the dual representation and
        that they consent to the same, and that they do not expect said broker
        to disclose to either of them the confidential information of the other
        party.

13.     COMMISSION.
        Upon execution of this Sublease, and consent thereto by Lessor (if such
        consent is required under the terms of the Master Lease), Sublessor
        shall pay Broker a real estate brokerage commission in accordance with
        Sublessor's contract with Broker for the subleasing of the Premises, if
        any and otherwise in the amount of Eighty-Six Thousand Six Hundred
        Fifty-Two and No/100 Dollars ($86,652.00), for services rendered in
        effecting this Sublease. SUBLESSOR IS REPRESENTED BY CB RICHARD ELLIS
        AND SUBLESSEE IS REPRESENTED BY NORRIS, BEGGS & SIMPSON. Broker is
        hereby made a third party beneficiary of this Sublease for the purpose
        of enforcing its right to said commission. PROVIDED SUBLESSOR AND
        SUBLESSEE EXTEND AND/OR EXPAND THE SUBLEASE AGREEMENT, SUBLESSOR SHALL
        PAY A LEASING COMMISSION EQUAL TO 5% OF THE AGGREGATE NET CONSIDERATION.

14.     NOTICES.
        All notices and demands which may or are to be required or permitted to
        be given by either party to the other hereunder shall be in writing. All
        notices and demands by the Sublessor to Sublessee shall be sent by
        United States Mail, postage prepaid, or reputable overnight carrier,
        addressed to the Sublessee at the Premises, and to the address
        hereinbelow, or to such other place as Sublessee may from time to time
        designate in a notice to the Sublessor. All notices and demands by the
        Sublessee to Sublessor shall be sent by United States Mail, postage
        prepaid, addressed to the Sublessor at the address set forth herein, and
        to such other person or place as the Sublessor may from time to time
        designate in a notice

                                                                          PAGE 4
<PAGE>   5

        to the Sublessee.

        To Sublessor:  5002 D Street NW, Auburn, WA  98001

        To Sublessee:  1516 NW Thurman, Portland, OR  97209

15.     CONSENT BY LESSOR.
        THIS SUBLEASE SHALL BE OF NO FORCE OR EFFECT UNLESS CONSENTED TO BY
        LESSOR WITHIN 10 DAYS AFTER EXECUTION HEREOF, IF SUCH CONSENT IS
        REQUIRED UNDER THE TERMS OF THE MASTER LEASE.

16.     COMPLIANCE.
        The parties hereto agree to comply with all applicable federal, state
        and local law, regulations, codes, ordinances and administrative orders
        having jurisdiction over the parties, property or the subject matter of
        this Agreement, including, but not limited to, the 1964 Civil Rights Act
        and all amendments thereto, the Foreign Investment In Real Property Tax
        Act, the Comprehensive Environmental Response Compensation and Liability
        Act, and the Americans With Disabilities Act.

Sublessor:     A & M Warehouses, Inc.            Sublessee:     800.COM, Inc.

By:     /s/ Nick Harbert                By:     /s/ Ken C. La Honta
   --------------------------------        --------------------------------
        Nick Harbert

Title:  President                       Title:  VP Finance, CFO
      -----------------------------           -----------------------------

By:                                     By:
   --------------------------------        --------------------------------

Date:   9/8/99                          Date:   9/10/99
     ------------------------------          ------------------------------

                                                                          PAGE 5
<PAGE>   6

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

PREMISES            The Premises shall consist of approximately 210,000 square
DESCRIPTION:        feet, located in the northwest corner of the building as
                    depicted in Exhibit A-1. The Premises also contains
                    approximately 3,500 square feet of office area in the corner
                    of the premises (Exhibit A-2).

SUBLESSOR'S         Sublessor shall, at Sublessor's sole expense, provide the
IMPROVEMENTS:       following "turn key" improvements to the Premises; which
                    shall be completed in a good workmanlike manner in
                    compliance with all laws, on or before the commencement
                    date.

                    o  construct a standard 12' high cyclone fence demising wall
                       around the perimeter of the premises as depicted on
                       Exhibit A-1.

                    o  construct a "secured area" fence per applicable municipal
                       code in an approximate 12,000 square foot area which is
                       depicted on Exhibit A-1.

                    o  install two (2) in-floor dock levelors (Kelly 6' x 8' -
                       30,000 lb. capacity or McGuire (MKA) - 25,000 lb.
                       capacity) at mutually agreed upon location.

                    o  construct an additional restroom facility with two
                       toilets and a urinal per Exhibit A-2.

                    o  construct a sink and counter area with two electrical
                       outlets per Exhibit A-2.

                    On or before the commencement date, Sublessor shall deliver
                    the Premises in broom clean condition, with all water,
                    sewer, electrical, gas, HVAC (office), sprinkler (ESFR),
                    roof (30' clear), dock doors, floors (6" thick), and
                    standard freeze protection units in good working order and
                    condition.

EARLY OCCUPANCY:    Commencing upon sublease execution, Tenant shall
                    have temporary occupancy of the Premises without charge for
                    rent for the purpose of storing product, installing
                    equipment, phone or data lines. Such early occupancy shall
                    not interfere with Sublessor's improvements.

SUBLEASE RENT       The base monthly rental for the 210,000 SF space shall be
SCHEDULE:           $71,400.00 monthly per the following schedule (prorated for
                    the month in which the Commencement Date occurs, if the
                    Commencement Date is not the 1st day of the month).

                                                                          PAGE 6
<PAGE>   7

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

<TABLE>
<CAPTION>
Initial Term Rent Schedule
--------------------------
<S>                              <C>                            <C>
Months 1-12:                     $71,400/month                  ($.34/sf), NNN
Months 13-18:                    $75,600/month                  ($.36/sf), NNN
</TABLE>

<TABLE>
<CAPTION>
Extension Term Rent Schedule
----------------------------
<S>                              <C>                            <C>
Months 19-22                     $71,400/month                  ($.34/sf), NNN
Months 23-34                     $73,500/month                  ($.35/sf), NNN
Months 35-46                     $75,600/month                  ($.36/sf), NNN
Months 47-58                     $77,700/month                  ($.37/sf), NNN
Months 59-60                     $79,800/month                  ($.38/sf), NNN
</TABLE>

                    The rental stated above is net rental, and it is understood
                    that as additional rent are all direct expenses (operating
                    expenses) equal to 40.2% of the operating costs incurred by
                    the Sublessor throughout the sublease term, subject to the
                    terms of Section 6.2 of the sublease.

BALLOON PAYMENT:    Provided Sublessee vacates the Premises at the
                    conclusion of the initial term of the sublease, Sublessee
                    shall pay to Sublessor a balloon payment equal to $29,310.00
                    which represents an unamortized Tenant Improvement
                    allowance.

SUBLESSEE'S         Sublessee shall be responsible for insuring its own contents
RESPONSIBILITIES    and for obtaining liability insurance during the lease term
AND EXPENSES:       and shall provide proof of insurance prior to occupancy.

MUTUAL WAIVER OF    Anything in this Sublease to the contrary notwithstanding,
SUBROGATION:        Sublessor and Sublessee hereby waive and release each other
                    of and from ant and all rights of recovery, claim, action or
                    cause of action, against each other, their partners, agents,
                    officers and employees, for any loss or damage that may
                    occurs to the Premises, Master Premises or building, or
                    personal property therein, that is covered by valid and
                    collectible insurance in effect at the time of such loss or
                    damage regardless of cause of origin, including negligence
                    of Sublessor or Sublessee and their partners, agents,
                    officers and employees. Sublessor and Sublessee agree to
                    give immediately to their respective insurance companies
                    which have issued policies of insurance covering any risk of
                    direct physical loss, written notice of the terms of the
                    mutual waivers contained in this Section.

                                                                          PAGE 7
<PAGE>   8

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

SUBLEASE            Provided Sublessee is not in default of the Sublease
EXPANSION:          agreement, Tenant shall have a right to expand into an
                    additional 100,000 SF of adjacent space as depicted on
                    Exhibit Al attached hereto. The rate of such expansion space
                    will be based on an initial shell rate of $.33/sf and
                    adjusted annually (August) by 3%. Sublessee shall provide
                    thirty (30) days written notice of their intent to expand,
                    and Sublessor shall utilize their best efforts to
                    accommodate such expansion. Sublessee shall be responsible
                    for any expenses involved with such expansion, such as
                    relocation of product, moving or adding demising walls, etc.
                    Also, the parties understand that Sublessor (AMWI) is a
                    logistics provider and may be able to accommodate an
                    expansion request by providing mutually beneficial
                    third-party logistics services.

SUBLEASE            Throughout the Sublease term, Sublessee shall have the right
EXTENSION:          to extend the sublease for a term equal to five (5) years
                    from the Commencement Date. The rental rate for such
                    extension will be adjusted to $.34/sf (NNN) at the time of
                    extension commencement, and will provide a three percent
                    (3%) annual increase. Sublessee shall provide five (5) month
                    written notice of such intent to extend the sublease term.

UTILITIES:          In the event utilities serving the Premises are separately
                    metered, Sublessee shall pay all charges for utilities
                    consumed by Sublessee in the Premises, as separately
                    metered, to the applicable utility company. In the event
                    such utilities are not separately metered, Sublessee shall
                    pay its proportionate share of such utilities to Sublessor,
                    as determined based on the number of square feet in the
                    Premises and taking into account Sublessee's use thereof.

                                                                          PAGE 8
<PAGE>   9

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

CASUALTY AND        In the event of fire of other casualty damage to the
CONDEMNATION:       Premises or any material portion thereof, that cannot be
                    repaired of otherwise restored within ninety (90) days of
                    such damage and that materially and adversely affect
                    Sublessee's use of the Premises, Sublessee shall have the
                    right to terminate the Sublease upon written notice to
                    Sublessor. If this Sublease is not so terminated, Rent due
                    hereunder shall abate until such time as the Premises is
                    restored and again useable by Sublessee. In the event of a
                    condemnation of any material portion of the Premises, such
                    that the remained of the Premises is not useable by
                    Sublessee for the use specified in this Sublease, Sublessee
                    shall have the right to terminate this Sublease upon written
                    notice to the Sublessor. If this Sublease is not terminated,
                    Rent shall be adjusted on a pro rata basis based on the
                    number of square feet in the Premises so condemned.

                                                                          PAGE 9
<PAGE>   10

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

In the event of any conflict between the terms of this Addendum and the
Sublease, the terms of this Addendum shall prevail.

Sublessor: A & M Warehouses, Inc.       Sublessee: 800.COM, Inc.

By:      /s/ Nick Harbert               By:     /s/ Ken La Honta
   --------------------------------         -------------------------------
         Nick Harbert

Title:   President                      Title:  VP Finance CFO

Address: 5002 D Street, NW              Address: 1516 NW Thurman
         Auburn, WA  98001                       Portland, OR  97209

Date:    9/8/99                          Date:   9/10/99

                                                                         PAGE 10
<PAGE>   11

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

                                   EXHIBIT A-1

                                    SITE PLAN

                                    [GRAPHIC]

                                                                         PAGE 11
<PAGE>   12

                        ADDENDUM TO REAL ESTATE SUBLEASE

                             DATED SEPTEMBER 8, 1999
                      BETWEEN 800.COM, INC., AS SUBLESSEE,
                    AND A & M WAREHOUSES, INC., AS SUBLESSOR

                                   EXHIBIT A-2

                                   FLOOR PLAN

                                    [GRAPHIC]

                                                                         PAGE 12<PAGE>   1
                                                                    EXHIBIT 10.7

                                                          December 30, 1999

Dear Bob:

We are pleased to offer you an opportunity to join 800.COM, as soon as possible.
The details of this offer are listed below. This offer supercedes any prior
offers.

Company:            800.COM is an online Internet retailer of consumer
                    electronics.

Position:           Senior Vice President, Chief Financial Officer

Compensation:       $250,000 per year is your target compensation based on a
                    100% performance level, with a potential to over-perform.
                    This includes a base salary and bonus opportunity as
                    follows:

Base Salary:        $200,000 per year.

Bonus Opportunity:  $50,000 annual opportunity at a 100%
                    performance level, with the potential to over-perform.
                    Criteria to be determined and agreed upon within a 30-day
                    period. Incentive to be paid quarterly, beginning April
                    2000.

Stock Options:      Pending approval by the board of directors, you
                    will be granted an option to purchase 300,000 shares of
                    common stock of 800.COM, which will vest 100% over a 4-year
                    period. As a key executive in the company, your options will
                    be eligible for accelerated vesting due to a change of
                    control as outlined in the final stock option plan.

Start Date:         January 5, 2000, or as soon as possible.

Termination:        If you are terminated without cause, you will receive 180
                    days severance pay at your base rate of pay.

Benefits:           800.COM insurance programs and other benefits as outlined in
                    the 800.COM employee handbook.

<PAGE>   2

Bob, the executive staff and I are very excited about the opportunity for you to
join us and take 800.COM to its next level of performance. We look forward to a
great journey together.

This offer is subject to written and signed approval by both parties, and
expires on January 4, 2000, 5pm. Although we plan our association with you will
be long lasting, 800.COM is an "at will" employer and nothing in this offer
letter may be construed as a contract of employment. Just as you will be free to
terminate your employment with 800.COM for any reason, 800.COM reserves the
right to terminate employment with or without cause. Please acknowledge your
acceptance of this offer by signing where indicated below.

Best regards,                         Accepted by:

/s/ Greg Drew  Date:  12-30-99        /s/ Bob Falcone       Date:  1-5-00
---------------------------------     -----------------------------------
Greg Drew, CEO                        Bob Falcone
800.COM, Inc.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00004-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00004-of-00352.parquet"}]]