Document:

Zones, Inc.

	 

Exhbiit 10.1 

BLACK DIAMOND GROUP 

A LIMITED LIABILITY
COMPANY 

October 30, 2003 

PERSONAL AND CONFIDENTIAL 

VIA EMAIL 

     Mr.
          Ron McFadden 
Chief Financial Officer 
Zones, Inc. 
1102 15th
Street, SW
Suite 102
Auburn, WA 98001 

Consulting Services
Letter Agreement 

Dear Ron: 

This letter serves to confirm the
agreement between Zones, Inc. (“Zones”) and William Keiper dba Black Diamond
Group LLC (“Keiper”) as of November 1, 2003 (the “Effective Date”), as
follows: 

    1.       
Scope of Engagement 

     	 	a. 	
          Keiper is engaged to provide consulting services to Zones. The services provided
          by Keiper may, as appropriate, include development of strategy, identifying and
          evaluating potential acquisition prospects, and such other advisory services as
          Keiper and Zones may agree upon from time to time. 

          

     	 	b. 	
          Keiper will consult by telephone, and meet in person, with senior management of
          Zones, and other parties designated by Zones, as and when reasonably necessary
          to assist Zones in making decisions wherein Keiper’s advice and counsel is
          deemed appropriate or desirable by Zones. 

          

         2.       
          Term of Engagement: 

	 	
The
term of this letter agreement shall extend from the Effective Date and continue for a
period of twelve (12) months thereafter. Either party may terminate Keiper’s
engagement at any time, for any reason or no reason, upon thirty (30) days written notice
to the other party. 

         3.       
          Compensation: 

     	 	a. 	
          As compensation for Keiper’s consulting and other services hereunder, Zones
          agrees to pay Keiper a monthly retainer in advance of $5,000
          (“Retainer”), payable in cash upon execution of this letter agreement,
          and thereafter on the first day of each month during the Term, unless earlier
          terminated 

          

     	 	b. 	
          In addition to the Retainer, Zones will reimburse Keiper for all reasonable
          out-of-pocket costs and expense, including, without limitation, out of area
          travel incurred by Keiper in connection with the rendering of service hereunder.
          No travel shall be undertaken without Zones’ prior authorization. Costs and
          expense shall be billed as incurred by Keiper. 

          

	

P.O BOX 12430 LAKE
TAHOE, NEVADA 89448 
                    775-722-4499 (OFFICE) 775-201-4000 (FAX)

                             WWW.GOBLACKDIAMOND.COM 

	

BLACK DIAMOND GROUP 

A LIMITED LIABILITY
COMPANY 

         4.       
          Information/Confidentiality: 

     	 	a. 	
          Zones will cooperate with, and make available to Keiper all information which
          Keiper reasonably requests in connection with the performance of his services,
          including all information concerning the business, assets, operations or
          financial condition of Zones. Keiper may rely upon the accuracy and completeness
          of such information without independent verification and is authorized to make
          appropriate use of such information. In addition, Zones shall be responsible for
          the completeness, accuracy, and format of all information prepared by Zones. 

          

     	 	b. 	
          Except as contemplated by the terms hereof or as required by applicable law,
          Keiper shall keep confidential all nonpublic information provided to it by
          Zones, and shall not disclose such information to any third party without the
          prior consent of Zones, other than to such of its employees and advisors as have
          need to know in the ordinary course of rendering services in accordance with
          this letter agreement. 

          

	

         5.       
          Independent Contractor: 

	 	
Keiper
is and will hereafter act as an independent contractor and not as an employee of Zones and
nothing in this letter agreement shall be interpreted or construed to create any
employment, partnership, joint venture or other relationship between Keiper and Zones. 

	

         6.       
          Governing Law: 

	 	
This
letter agreement may not be amended or modified except in writing and shall by governed by
the laws of the State of Washington. 

	

         7.       
          Entire Agreement: 

	 	
This
letter agreement is intended by the parties to be the final expression of their agreement
and constitutes and embodies the entire agreement between the parties (including
stockholders, partners, subsidiaries and affiliates) and constitutes a complete and
exclusive statement of terms and condition, and shall supersede any other agreements,
correspondence, conversations and understanding between the parties (including their
stockholders, partners, subsidiaries and affiliates) relating to the subject matter of
this letter agreement. 

	

         8.       
          Counterparts, Electronic Transmission: 

	 	
This
letter agreement may be signed in counterparts, each of which shall be deemed an original,
and signatures to this letter agreement transmitted by electronic means including
facsimile shall be deemed original, manual signatures. 

	

     *   *   * 

	 	
Please
confirm that the foregoing is in accordance with your understanding by signing and
returning the duplicate of this letter (or, if received by facsimile, by signing the
facsimile and transmitting a copy to me by facsimile), which will then constitute a
binding agreement. 

	

P.O BOX 12430 LAKE
TAHOE, NEVADA 89448 
                    775-722-4499 (OFFICE) 775-201-4000 (FAX)

                             WWW.GOBLACKDIAMOND.COM 

	 	
Sincerely, 

	 	
/S/
WILLIAM KEIPER 

	 	
William
Keiper dba
Black Diamond Group LLC 

	 	
*   *   * 

	 	
The
undersigned agrees to and accepts the above letter agreement and acknowledges receipt of a
copy of this letter agreement. 

	 	
Zones,
Inc. 

	 	
/S/
RON MCFADDEN 

	 	
Ron
McFadden
Chief Financial Officer 

	

P.O BOX 12430 LAKE
TAHOE, NEVADA 89448 
                    775-722-4499 (OFFICE) 775-201-4000 (FAX)

                             WWW.GOBLACKDIAMOND.COMZones, Inc.

	 

Exhibit 10.2  

      EMPLOYMENT
        AND NON-COMPETITION AGREEMENT 

    

      This
        Employment and Non-Competition Agreement (the “Agreement”) is
        entered into as of March 31, 2003 by and between Zones, Inc. (“Parent”),
        Corporate PC Source, Inc. (the “Company,”)
        and Christina Corley (the “Associate”).
        Unless otherwise defined herein, the terms defined in the Purchase Agreement
        (as such term is defined below) shall have the same defined meanings in
        this Agreement. 

    

      RECITALS

      A.              Parent,
        the Company and all of the Company’s Shareholders have entered into
        a Stock Purchase Agreement, dated as of March 31, 2003 (the “Purchase
        Agreement”), providing
        for the Parent’s acquisition of all of the outstanding shares of
        the Company (the “Acquisition”). 

      B.              Associate,
        an officer and significant shareholder of the Company will, as a result
        of the Acquisition, receive significant consideration, including cash
        payments representing the value of the goodwill of the Company. 

      C.              Parent
        and Associate acknowledge that it would be detrimental to Parent if Associate
        would compete with the Company’s Business (as defined below) following
        the Acquisition, as described in Paragraph 11 below. 

      D.              Associate
        has been actively involved in the development of the Company’s business.
        To preserve and protect the assets of the Company, including
        the Company’s goodwill and customers to which
        Associate has, and will have, in her role as an Associate of the Company
        access, and to preserve and protect the Company’s goodwill and business
        interests going forward, and in consideration for the Company entering
        into and performing under the Purchase Agreement and to induce Parent
        to enter into the Purchase Agreement, Associate has agreed to enter into
        this Agreement. 

      NOW,
        THEREFORE, based on the foregoing premises and
        in consideration of the commitments set forth below, Associate, Parent
        and Company agree as follows: 

    

      	
            1. 

          	
            Duties
              and Scope of Employment.  

          

	

      
        (a)           As
        of the date hereof, Associate will serve as Senior Vice President of Parent
        and President and Chief Executive Officer of the Company, reporting to
        the Board of Directors of the Company. Associate will be responsible for
        day-to-day management of the Company, subject to the direction and guidance
        of the Board of Directors of the Company, as further described on attached
        Exhibit A. Associate will
        perform her duties faithfully and to the best of her ability and will
        devote her full business efforts and time to the performance of her duties
        hereunder. 

      (b)            The
        Company agrees that the Associate shall be appointed to the Board of Directors
        of the Company. Associate agrees that if her employment is terminated
        for any reason, Associate shall tender her resignation as a member of
        the Board of Director of the Company. 

      

      

      
    

	 

      2.               Base
        Salary. For all services to be rendered by
        Associate pursuant to this Agreement, Associate shall receive an annualized
        salary of $300,000 (“Base Salary”).
        The Board shall review Associate’s Base Salary at least annually,
        but may not reduce the Base Salary below $300,000. The Base Salary shall
        be payable in accordance with Company’s normal payroll practices
        and be subject to applicable income tax and other applicable withholding,
        subject to Associate’s continued employment. 

      3.               Incentive
        Bonus. In addition to Base Salary, Associate
        shall be paid a quarterly incentive bonus based on the Company’s
        quarterly Gross Profits, calculated in accordance with the Company’s
        normal financial statements (the “Bonus”). For purposes of this
        Agreement, Gross Profits shall be equal to net sales, less cost of sales.
        Subject to Associate’s continued employment, the Bonus shall be payable
        on the last payroll date of the month following the quarter end in which
        the Gross Profits are recognized and be subject to income tax and other
        applicable withholding. Associate shall not be entitled to participate
        in any of the Company’s or Parent’s other bonus plans or bonus
        programs. 

      4.               Benefits.
        Associate shall be entitled to participate in (i) the employee benefit
        plans and programs of the Company applicable to its other executives at
        the senior executive level (other than as excluded in Section 3 above)
        and (ii) the other benefit plans and programs of the Company to the extent
        that Associate’s position, tenure, salary, age, health and other
        qualifications make Associate eligible to participate in such plans or
        programs, in each case subject to the rules and regulations applicable
        thereto. For purposes of the foregoing benefits, to the extent such tenure
        may be relevant to the benefit plans and programs of the Company, Associate
        shall be entitled to credit for her tenure with the Company prior to the
        date of this Agreement. The Company reserves the right to cancel or change
        the benefit plans and programs it offers to its employees at any time.
        With respect to any such cancellation or amendment, Associate will be
        treated in the same manner as other senior executes of the Company, taking
        into account Associate’s position, tenure, salary, age, health, and
        like qualifications. 

      5.               Vacation
        and Maternity Leave.
        Associate will be entitled to five (5) weeks of paid vacation per year.
        Associate will not be entitled to carry over any vacation time into subsequent
        years; any vacation time not used will be forfeited. In addition, Associate
        will be entitled to eight (8) weeks of paid maternity leave. 

      6.               Stock
        Options. Associate
        will be granted incentive stock options to purchase 70,000 shares of Zones
        common stock under the Zones, Inc. 1993 Stock Incentive Plan (the “Option”)
        with a three-year vesting period. The Option shall have an exercise price
        equal to the closing price per share of Parent’s common stock on
        April 1, 2003. The Option shall vest in equal quarterly installments over
        a three-year period of continuous service to the Company by the Associate.
        Parent may from time-to-time award additional stock option grants, in
        the sole discretion of Parent’s Board of Directors. The then-governing
        equity incentive plan and the applicable stock option agreement(s) shall
        govern any such additional options. 

      7.               Expenses.
        The Company will reimburse Associate for reasonable travel and other expenses
        incurred by Associate in connection with the performance of Associate’s
        duties hereunder, in accordance with the Company’s expense reimbursement
        policy as is in effect from time to time. 

      

      

      
    

	 

      8.               Term
        of Employment. Unless otherwise terminated
        in accordance with the terms of this Agreement (as described in Paragraph
        9 below), the term of Associate’s employment hereunder (the “Employment
        Term”) shall commence on the date hereof
        and shall continue until and terminate on March 31, 2006 (the “End
        Date”). 

      9.               Termination
        of Employment. Associate’s employment
        may be terminated prior to the End Date, only as follows: 

      (a)             Termination
        by Associate for Good Reason. Prior the End Date,
        Associate may only terminate her employment at any time for Good Reason
        (as defined below). If Associate terminates her employment for Good Reason,
        then, subject to Associate’s continuing obligations under Section
        11 of this Agreement, Associate shall be entitled to: 

      (i)    a
        severance amount equal to six (6) months of Associate’s last Base
        Salary and Bonus (subject to applicable tax withholdings), payable over
        the six (6) month period following the date of termination in substantially
        equal installment payments and in accordance with the normal payroll practices
        of the Company; and 

      (ii)   Company-paid
        health insurance benefits for the Associate and the Associate’s dependents
        as provided to the Associate under the terms and conditions of the standard
        Company benefits programs immediately prior to the termination until the
        earlier of (A) six (6) months from the date of the termination, or
        (B) the date upon which the Associate and her dependents become covered
        under another employer’s benefit programs. 

      Associate
        shall not be entitled to receive any severance pay, as provided above,
        unless she executes a full release of claims against the Company and Parent,
        in a form acceptable to the Company and Parent, and such release is received
        by the Company on or before thirty (30) days after Associate’s employment
        with the Company has terminated, and the Associated re-affirms the binding
        nature of the non-compete provisions contained in Section 11 hereof.
        

      (b)            Termination
        by the Company for Cause. The Company may terminate
        Associate’s employment at any time for Cause. The Company may terminate
        the Associate’s employment at any time after the End Date without
        Cause. Associate may terminate her employment at any time after the End
        Date without Good Reason (as defined below) upon thirty (30) days advance
        written notice to the Parent and the Company’s Board of Directors.
        If the Company terminates Associate’s employment for Cause (as defined
        below) or the Associate voluntarily resigns after the End Date without
        Good Reason, Associate shall only be entitled to Base Salary and Bonus
        at the rate in effect at the time of her termination through the effective
        date of termination of employment. 

      (c)             Death
        or Disability. In the event of Associate’s
        death or a termination of Associate’s employment due to Associate’s
        Disability (as defined below), no compensation or payments will be made
        to Associate other than those to which she is entitled under the Company’s
        existing benefit plans and policies at the time of such termination and
        other than any compensation or payments accrued under this Agreement up
        to the date of termination of her employment and unpaid at the date of
        such termination. 

      

      

      
    

	
      (d) 

    	
      Definitions. 

    	
       
    

(i)
  “Cause
” shall mean any of the following:  

	
      
        (1)           the
        conviction of Associate of, or the entry by Associate of a plea of guilty
        or no contest to, any felony; 

      (2)            any
        material breach by Associate of this Agreement or any confidentiality
        or proprietary information agreement between Associate and the Company,
        Parent or its affiliates; 

      (3)            an
        act of fraud or material dishonesty against, or the misappropriation of
        property belonging to, Parent, the Company or any affiliate of Parent; 

      (4)            a
        willful and material violation of a written policy of the Company generally
        applicable to all employees, the violation of which is stated in such
        policy to be grounds for termination; 

      (5)            the
        commission of an intentional act which constitutes unfair competition
        with the Company or Parent or which induces any customer of the Company
        or Parent to breach a contract with the Company or Parent; or 

      (6)            an
        intentional act by Associate that constitutes gross misconduct and which
        is materially and demonstrably injurious to the Company or Parent. 

      (ii)   “Disability”
        shall mean the inability of Associate, even with reasonable accommodation,
        to perform the essential functions of her position as an Associate of
        the Company as a result of sickness or injury, and Associate shall have
        remained unable to perform any such duties (i) for a continuous period
        of more than one hundred twenty (120) days, or (ii) for two or more periods
        aggregating more than one hundred twenty (120) days in a twelve (12) month
        period. Any disputes over the existence of a disability for purposes of
        this Agreement will be resolved by a physician mutually agreed upon by
        Associate (or her fiduciary) and Parent. 

      (iii)

  “Good
        Reason” shall mean and exist if, without
        Associate’s prior written consent, one or more of the following events
        occurs: 

      (1)            Associate
        suffers a material reduction, when taken as a whole, in the authority,
        duties or responsibilities associated with her position as described in
        Section 1 above;  

      
    

	
      (2) 

    	
      Any diminution to Associate’s
        Base Salary; 

    

	

  (3)           Any
  material reduction of the employee benefits provided to Associate (except to
  the extent that all other executives at the senior executive level receive such
  diminution); 

      

      

      
    

	 

(4)            the
  relocation by Parent of the Company’s principal business offices, or Associate’s
  primary work location, to a location that is more than fifty (50) miles from
  the location of such offices at the date hereof; or 

(5)            the
  Company materially breaches this Agreement which breach remains uncured (where
  curable) for thirty (30) days after receipt of written notice from the Associate. 

10.            Proprietary
  Rights Agreement. Associate will be required as
  a condition of employment to sign and abide by the Parent’s standard Employee
  Innovations and Proprietary Rights Assignment Agreement (the “Proprietary
  Rights Agreement”), a copy of which is attached
  as Exhibit B. Nothing in the Proprietary Rights Agreement shall limit or otherwise
  circumscribe any confidentiality agreement Associate may have previously entered
  into with the Company. 

	
      11. 

    	
      Non-Competition
        and Non-Solicitation. 

    

	

  (a)           Beginning
  at the date hereof and ending five (5) years after the date hereof (the “Non-Compete
  Period”), Associate shall not, other than on behalf
  Company or Parent, directly or indirectly, without the prior written consent
  of Parent or Company,  

(i)    engage
  in the Geographic Area (as defined below) as an employee, agent, consultant,
  advisor, independent contractor, proprietor, partner, officer, director or otherwise
  of;  

(ii)   have
  any ownership interest in (except for passive ownership of one percent (1%)
  or less of any entity whose securities have been registered under the Securities
  Act of 1933 or Section 12 of the Securities Exchange Act of 1934 or the
  securities laws of any other jurisdiction); or  

(iii)    participate in the financing,
        operation, management or control of any   firm, partnership, corporation, entity
or business that directly or indirectly   competes with the Company’s Business.   

 

(b)            The
  term “Company’s Business”
  shall mean the business of reselling of technology related produces and services.
   

(c)             Beginning
  at the date hereof and ending five (5) years following Associate’s termination
  (voluntary or involuntary) of employment, Associate shall not, directly or indirectly,
  without the prior written consent of Parent and Company, solicit, encourage
  or take any other action which is intended to induce or encourage any Associate
  or customer of Parent or its subsidiaries (including the Company) to terminate
  her employment with or customer relationship with Parent or its subsidiaries
  (including the Company). 

	

(d)            The
  “Geographic Area” shall
  mean anywhere in the world where Parent or any of its subsidiaries (including
  the Company) conducts Company Business during the Non-Compete Period, including,
  without limitation, the United States.  

(e)             The
  covenants contained in the preceding paragraphs shall be construed as a series
  of separate covenants, one for each county, city, state, or any similar subdivision
  in any Geographic Area. Except for geographic coverage, each such separate covenant
  shall be deemed identical in terms to the covenant contained in the preceding
  paragraphs. If, in any judicial proceeding, a court refuses to enforce any of
  such separate covenants (or any part thereof), then such unenforceable covenant
  (or such part) shall be eliminated from this Agreement to the extent necessary
  to permit the remaining separate covenants (or portions thereof) to be enforced.
  In the event that the provisions of this Section are deemed to exceed the
  time, geographic or scope limitations permitted by applicable law, then such
  provisions shall be reformed to the maximum time, geographic or scope limitations,
  as the case may be, permitted by applicable laws. 

(f)              Associate
  also acknowledges that the limitations of time, geography, and scope of activity
  agreed to in this Agreement are reasonable because, among other things, (i) Parent
  and the Company are engaged in a highly competitive industry, (ii) Associate
  is receiving significant compensation in connection with the Acquisition and
  pursuant to this Agreement, and (iii) in the event Associate’s employment
  with Parent or Company ended, Associate would not be precluded from engaging
  in her profession without violating this Agreement.  

(g)             Associate
  agrees that it would be impossible or inadequate to measure and calculate Company’s
  or Parent’s damages from any breach of the covenants set forth in this
  Section or Section 10. Accordingly, the Associate agrees that if she breaches
  any provision of this Section or Section 10, either or both of Parent and
  Company will have available, in addition to any other right or remedy otherwise
  available, the right to obtain an injunction from a court of competent jurisdiction
  restraining such breach or threatened breach and to specific performance of
  any such provision of this Agreement. Associate further agrees that no bond
  or other security shall be required in obtaining such equitable relief, nor
  will proof of actual damages be required for such equitable relief. 

12.            Assignment.
  This Agreement will be binding upon and inure to the benefit of (a) the
  heirs, executors and legal representatives of Associate upon Associate’s
  death and (b) any successor and assigns of Parent and/or Company. Any such
  successor of Parent and/or Company will be deemed substituted for Parent and/or
  Company under the terms of this Agreement for all purposes. For this purpose,
  “successor” means any person, firm, corporation or other business
  entity which at any time, whether by purchase, merger or otherwise, directly
  or indirectly acquires all or substantially all of the assets or business of
  Parent and/or Company. None of the rights of Associate to receive any form of
  compensation payable pursuant to this Agreement may be assigned or transferred
  except by will or the laws of descent and distribution. Any other attempted
  assignment, transfer, conveyance or other disposition of Associate’s right
  to compensation or other benefits will be null and void. 

13.
            

Notices.
  All notices, requests, demands and other communications called for hereunder
  shall be in writing and shall be deemed given (i) on
  the date of delivery if delivered  personally,
  (ii) one (1) day after being sent by a well-established commercial overnight
  service, or (iii) five (5) days after being mailed by registered or certified
  mail, return receipt requested, prepaid and addressed to the parties or their
  successors at the following addresses, or at such other addresses as the parties
  may later designate in writing: 

		
			If
      to Company or Parent:	 
				 
			Zones,
      Inc.	 
	  		707
      Grady Way	 
	    		Renton,
      WA 98055	 
	  		Attention:
      Ron McFadden	 
				 
	  		If
      to Associate:	 
				 
	    		Christina
      Corley	 
				 
	    		at
      the last residential address known by the Company.	 

	

14.            Severability.
  In the event that any provision hereof becomes or is declared by a court of
  competent jurisdiction to be illegal, unenforceable or void, this Agreement
  will continue in full force and effect without said provision.

	
      15. 

    	
      Arbitration.

    

	

  (a)           IN
  CONSIDERATION OF ASSOCIATE’S EMPLOYMENT WITH THE COMPANY, COMPANY’S
  AGREEMENT TO ARBITRATE ALL DISPUTES WITH ASSOCIATE AND ASSOCIATE’S RECEIPT
  OF THE COMPENSATION, PAY RAISES AND OTHER BENEFITS PAID TO HER BY THE COMPANY,
  AT PRESENT AND IN THE FUTURE, ASSOCIATE AGREES TO THE EXTENT PERMITTED BY LAW
  THAT ANY AND ALL CONTROVERSIES, CLAIMS, OR DISPUTES WITH ANYONE (INCLUDING THE
  COMPANY AND ANY ASSOCIATE, OFFICER, DIRECTOR, SHAREHOLDER OR BENEFIT PLAN OF
  THE COMPANY IN THEIR CAPACITY AS SUCH OR OTHERWISE) ARISING OUT OF, RELATING
  TO, OR RESULTING FROM ASSOCIATE’S EMPLOYMENT WITH THE COMPANY OR THE TERMINATION
  OF ASSOCIATE’S EMPLOYMENT WITH THE COMPANY, INCLUDING ANY BREACH OF THIS
  AGREEMENT, SHALL BE SUBJECT TO BINDING ARBITRATION. DISPUTES WHICH ASSOCIATE
  AGREES TO ARBITRATE, AND THEREBY AGREES TO WAIVE ANY RIGHT TO A TRIAL BY JURY,
  INCLUDE ANY STATUTORY CLAIMS UNDER STATE OR FEDERAL LAW, INCLUDING, BUT NOT
  LIMITED TO, CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AMERICANS
  WITH DISABILITIES ACT OF 1990, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967,
  THE OLDER WORKERS BENEFIT PROTECTION ACT, WASHINGTON LAW, CLAIMS OF HARASSMENT,
  DISCRIMINATION OR WRONGFUL TERMINATION AND ANY STATUTORY CLAIMS. ASSOCIATE FURTHER
  UNDERSTANDS THAT THIS AGREEMENT TO ARBITRATE ALSO APPLIES TO ANY DISPUTES THAT
  THE COMPANY MAY HAVE WITH HER.  

	

(b)            Procedure.
  ASSOCIATE AGREES THAT ANY ARBITRATION WILL BE ADMINISTERED BY THE AMERICAN ARBITRATION
  ASSOCIATION ("AAA") AND THAT THE NEUTRAL ARBITRATOR WILL BE SELECTED IN A MANNER
  CONSISTENT WITH ITS NATIONAL RULES FOR THE RESOLUTION OF EMPLOYMENT DISPUTES.
  ASSOCIATE AGREES THAT THE ARBITRATOR SHALL HAVE THE POWER TO DECIDE ANY MOTIONS
  BROUGHT BY ANY PARTY TO THE ARBITRATION, INCLUDING MOTIONS FOR SUMMARY JUDGMENT
  AND/OR ADJUDICATION AND MOTIONS TO DISMISS AND DEMURRERS, PRIOR TO ANY ARBITRATION
  HEARING. ASSOCIATE ALSO AGREES THAT THE ARBITRATOR SHALL HAVE THE POWER TO AWARD
  ANY REMEDIES, INCLUDING ATTORNEYS' FEES AND COSTS, AVAILABLE UNDER APPLICABLE
  LAW. ASSOCIATE UNDERSTANDS THE COMPANY WILL PAY FOR ANY ADMINISTRATIVE OR HEARING
  FEES CHARGED BY THE ARBITRATOR OR AAA EXCEPT THAT ASSOCIATE SHALL PAY THE FIRST
  $125.00 OF ANY FILING FEES ASSOCIATED WITH ANY ARBITRATION ASSOCIATE INITIATES.
  ASSOCIATE AGREES THAT THE ARBITRATOR SHALL ADMINISTER AND CONDUCT ANY ARBITRATION
  IN A MANNER CONSISTENT WITH THE RULES AND THAT TO THE EXTENT THAT THE AAA'S
  NATIONAL RULES FOR THE RESOLUTION OF EMPLOYMENT DISPUTES CONFLICT WITH THE RULES,
  THE RULES SHALL TAKE PRECEDENCE. ASSOCIATE AGREES THAT THE DECISION OF THE ARBITRATOR
  SHALL BE IN WRITING. 

(c)             Remedy.
  EXCEPT AS PROVIDED BY THE RULES AND THIS AGREEMENT, ARBITRATION SHALL BE THE
  SOLE, EXCLUSIVE AND FINAL REMEDY FOR ANY DISPUTE BETWEEN ASSOCIATE AND THE COMPANY.
  ACCORDINGLY, EXCEPT AS PROVIDED FOR BY THE RULES AND THIS AGREEMENT, NEITHER
  ASSOCIATE NOR THE COMPANY WILL BE PERMITTED TO PURSUE COURT ACTION REGARDING
  CLAIMS THAT ARE SUBJECT TO ARBITRATION. NOTWITHSTANDING, THE ARBITRATOR WILL
  NOT HAVE THE ABILITY TO ORDER OR REQUIRE THE COMPANY TO ADOPT A POLICY NOT OTHERWISE
  REQUIRED BY LAW. 

(d)            Availability
  of Injunctive Relief. IN ADDITION TO THE RIGHT UNDER
  THE RULES TO PETITION THE COURT FOR PROVISIONAL RELIEF, ASSOCIATE AGREES THAT
  ANY PARTY MAY ALSO PETITION THE COURT FOR INJUNCTIVE RELIEF WHERE EITHER PARTY
  ALLEGES OR CLAIMS A VIOLATION OF THE EMPLOYMENT, PROPRIETARY RIGHTS AGREEMENT
  BETWEEN HER AND THE COMPANY OR ANY OTHER AGREEMENT REGARDING TRADE SECRETS,
  CONFIDENTIAL INFORMATION, NONCOMPETITION OR NONSOLICITATION. ASSOCIATE UNDERSTANDS
  THAT ANY BREACH OR THREATENED BREACH OF SUCH AN AGREEMENT WILL CAUSE IRREPARABLE
  INJURY AND THAT MONEY DAMAGES WILL NOT PROVIDE AN ADEQUATE REMEDY THEREFOR AND
  BOTH PARTIES HEREBY CONSENT TO THE ISSUANCE OF AN INJUNCTION. IN THE EVENT EITHER
  PARTY SEEKS INJUNCTIVE RELIEF, THE PREVAILING PARTY SHALL BE ENTITLED TO RECOVER
  REASONABLE COSTS AND ATTORNEYS FEES. 

	

(e)             Administrative
  Relief. ASSOCIATE UNDERSTANDS THAT THIS AGREEMENT DOES
  NOT PROHIBIT HER FROM PURSUING AN ADMINISTRATIVE CLAIM WITH A LOCAL, STATE OR
  FEDERAL ADMINISTRATIVE BODY SUCH AS THE DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING,
  THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION OR THE WORKERS' COMPENSATION BOARD.
  THIS AGREEMENT DOES, HOWEVER, PRECLUDE HER FROM PURSUING COURT ACTION REGARDING
  ANY SUCH CLAIM. 

(f)              Voluntary
  Nature of Agreement. ASSOCIATE ACKNOWLEDGE AND AGREES
  THAT SHE IS EXECUTING THIS AGREEMENT VOLUNTARILY AND WITHOUT ANY DURESS OR UNDUE
  INFLUENCE BY THE COMPANY OR ANYONE ELSE. SHE FURTHER ACKNOWLEDGES AND AGREES
  THAT SHE HAS CAREFULLY READ THIS AGREEMENT AND THAT SHE HAS ASKED ANY QUESTIONS
  NEEDED FOR HER TO UNDERSTAND THE TERMS, CONSEQUENCES AND BINDING EFFECT OF THIS
  AGREEMENT AND FULLY UNDERSTAND IT, INCLUDING THAT ASSOCIATE IS WAIVING
  ASSOCIATE’S RIGHT TO A JURY TRIAL. FINALLY,
  SHE AGREES THAT SHE HAS BEEN PROVIDED AN OPPORTUNITY TO SEEK THE ADVICE OF AN
  ATTORNEY OF HER CHOICE BEFORE SIGNING THIS AGREEMENT. 

16.            Entire
  Agreement; Integration. This Agreement, together
  with exhibits hereto and any other documents incorporated herein by reference,
  represent the entire agreement and understanding between the parties as to the
  subject matter herein and supersede all prior or contemporaneous agreements
  whether written or oral; provided, however,
  that nothing herein shall in any way supersede the provisions of the Purchase
  Agreement. Associate acknowledges and agrees that this Agreement replaces in
  their entirety any written or oral employment agreement; offer letter or other
  compensatory or severance agreement previously in effect between Parent or the
  Company and Associate. No waiver, alteration, or modification of any of the
  provisions of this Agreement will be binding unless in writing and signed by
  duly authorized representatives of the parties hereto. 

17.            Waiver
  of Breach. The waiver of a breach of any term or
  provision of this Agreement, which must be in writing, shall not operate as
  or be construed to be a waiver of any other previous or subsequent breach of
  this Agreement. 

18.            Headings.
  All captions and section headings used in this Agreement are for convenient
  reference only and do not form a part of this Agreement. 

19.            Tax
  Withholding. All payments made pursuant to this
  Agreement will be subject to withholding of applicable taxes.  

20.            Governing
  Law. The parties agree that this Agreement, and any
  disputes arising under this Agreement, will be governed by and construed in
  accordance with the laws of the state of Washington, without giving effect to
  any conflict of laws principle to the contrary. The parties agree that venue
  for any dispute arising under this Agreement will lie exclusively in the state
  or federal courts located in King County, Washington, and the parties irrevocably
  waive any right to raise forum non conveniens or any other argument that Washington
  is not the proper venue.
  The parties irrevocably consent to personal jurisdiction in the state and federal
  courts of the state of Washington.  

	

21.            Acknowledgment.
  Associate acknowledges that she has had the opportunity to discuss this matter
  with and obtain advice from her private attorney, has had sufficient time to,
  and has carefully read and fully understands all the provisions of this Agreement,
  and is knowingly and voluntarily entering into this Agreement. 

22.            Contingency
  of Agreement upon Acquisition. This Agreement shall
  be null and void and have no effect unless the Acquisition contemplated by the
  Purchase Agreement is consummated. 

23.            Counterparts.
  This Agreement may be executed in counterparts, and each counterpart shall have
  the same force and effect as an original and shall constitute an effective,
  binding agreement on the part of each of the undersigned. 

[Remainder
  of page intentionally left blank. Signature page follows.]

	

                    IN
  WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
  of the Company by their duly authorized officers, as of the day and year first
  above written. 

  

        

		
	CORPORATE
      PC SOURCE, INC.			 
	 	 	 	 
	 	 	 	 
	By:
        /S/ CHRISTINA M CORLEY          		Date:
      March 31, 2003                 	 
	Print
      Name:  Christina M Corley             			 
	Title:  
      CEO                                                 			 
	 	 	 	 
	 	 	 	 
	ZONES,
      INC.			 
	 	 	 	 
	 	 	 	 
	By:
        /S/ RONALD P MCFADDEN        		Date:
      March 31, 2003                 	 
	Print
      Name:   Ronald P McFadden         			 
	Title:
        SVP, CFO                                       			 
	 	 	 	 
	 	 	 	 
	ASSOCIATE			 
	 	 	 	 
	 	 	 	 
	  /S/
      CHRISTINA CORLEY                       		Date:
      March 31, 2003                 	 
	Christina
      Corley		 	 

	

[Signature
  Page to Employment and Non-Competition Agreement]

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