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Exhibit
10.1
EXECUTIVE EMPLOYMENT
AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT
(“Agreement”), effective as of May 16, 2007, is
entered into by and between Spark Networks plc, a company organized
under the laws of England and Wales (the “Company”),
with its principal office at 8383 Wilshire Boulevard,
Suite 800, Beverly Hills, California 90211, and Gregory J.
Franchina, an individual residing at the address set forth in the
records of the Company (the “Executive”).
In consideration of the promises and the
respective covenants and agreements of the parties herein
contained, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Employment :
The Company hereby agrees to employ
Executive, and Executive hereby agrees to serve the Company, on the
terms and conditions set forth herein.
2. Term :
The employment of Executive by the
Company as provided in paragraph 1 will commence on the
“Commencement Date,” defined as June 1, 2007, and
will continue indefinitely, subject to the termination provisions
as set forth in paragraph 5.
3. Position and Duties
:
Executive shall serve as Chief
Information Officer and shall report directly to the CEO of the
Company. The Executive shall be located in the Company’s
Beverly Hills, CA office and the Executive shall have such duties
and responsibilities as are commensurate with his position, and any
reasonable and appropriate additional responsibilities and
authority as may be from time to time assigned to Executive by the
Company. Executive shall devote substantially all his working time
and efforts to the business affairs of the Company, provided that,
notwithstanding the foregoing, Executive may (i) make and
manage personal business investments of his choice subject to the
Company’s Code of Business Conduct and Ethics and disclosure
requirements under applicable law, (ii) serve as a director of
any business enterprise with the prior written consent of the
Company’s CEO, which consent shall not be unreasonably
withheld, and (iii) serve in any capacity with any civic,
educational, religious or charitable organization, or any
governmental entity or trade association provided such activity
does not affect Executive’s ability to perform his role. From
time to time the Company may assign the Executive to work in other
departments of the Company, or for a subsidiary, affiliated, or
holding company, in a materially similar position with materially
similar duties and responsibilities.
4. Compensation and Related
Matters :
(a) Salary : The Company
shall pay to Executive an annual salary at a rate of not less than
$231,000 per year (the “Base Salary”), paid in
accordance with the Company’s regular and normal payroll
practices and withholdings. The Executive will be entitled to
annual bonuses and salary increase reviews in accordance with the
normal customs and practices of the Company.
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(b) Performance Bonus: Executive
shall be eligible for an annual bonus based on the calendar year
performance of the Company and the Executive (the
“Performance Bonus”). The target amount of the bonus
shall be $125,000 and shall be determined based on the
Company’s calendar year revenue, a measure of the
Company’s calendar year profits such as earnings before
interest, taxes, depreciation and amortization
(“EBITDA”) or adjusted EBITDA, and a discretionary
component. With the exception of the fiscal year ending
December 31, 2007, the Performance Bonus shall be based on a
12-month “Performance Period” beginning on
January 1 and ending on December 31 of each fiscal year
during the Term of employment. The Performance Period for the
fiscal year ending December 31, 2007 shall begin on the
Commencement Date. The exact formula for the bonus for 2007 will be
determined by the Company and presented to the Executive as soon as
reasonably practicable, and the actual amount earned by the
Executive shall be pro-rated for the Executive’s actual
employment in 2007. To be eligible for the Performance Bonus, the
Executive must maintain continuous employment with the Company
throughout the Performance Period and through the date of the
Performance Bonus payment (unless the Agreement is terminated by
the Company without Cause or by the Executive for Good Reason after
the Performance Period has been completed, but before payment of
the Performance Bonus, in which case the Executive will receive the
Performance Bonus payment on the date Company makes such payment).
Payment of the Performance Bonus shall be made at the
Company’s discretion following the completion of the annual
audited financial statements, but in no event later than six
(6) months from the last day of each performance period,
provided Executive has maintained continuous employment with the
Company through such date (unless the Agreement is terminated by
the Company without Cause or by the Executive for Good Reason after
the Performance Period has been completed, but before payment of
the Performance Bonus, in which case the Executive will receive the
Performance Bonus payment on the date Company makes such payment).
If Executive has remained continuously employed by the Company on
the date of the Performance Bonus payment, or on the date on which
a Performance Bonus would have been paid for 2007, he shall receive
a minimum bonus payment of $15,000 for 2007, notwithstanding any
additional amounts earned due to performance or at the discretion
of the Company. In the event the Company fails to determine a
formula for the Performance Bonus prior to 60 days after the start
of the Performance Period, the Executive will earn the pro rata
share of the bonus between the start of the Performance Period and
the date upon which the formula is determined by the Company and
presented to the Executive.
(c) Vacation : In addition
to legal holidays observed by the Company, Executive shall be
entitled to fifteen (15) days of paid vacation per year (which
is equivalent to seventeen (17) days of paid-time-off
(“PTO”) under the Company’s current PTO policy),
subject to the applicable maximum cap on accrual and other standard
vacation policies of the Company. The Company may grant Executive
advances against future vacation accruals at Executive’s
request. Upon termination of Employment, unused vacation days will
be paid out to Executive on the date of termination based on the
accrued amount of vacation compensation due to
Executive.
(d) Expenses : During the
term of Executive’s employment hereunder, Executive shall be
entitled to receive prompt reimbursement for all reasonable
expenses incurred by Executive in performing services hereunder,
including all expenses for travel and living expenses
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while away from home on business or at
the request of and in the service of the Company, provided that
such expenses are incurred and accounted for in accordance with the
policies and procedures established by the Company. For the
avoidance of doubt, Executive shall be reimbursed for cell phone
usage and monthly broadband access fees to enable him to
effectively manage and monitor the company’s
systems.
(e) Health, and Other
Benefits : The Company shall keep in full force and effect, and
Executive shall be entitled to continue to participate in, all of
the Company’s Executive benefit plans or arrangements,
including without limitation health insurance, providing Executive
and his immediate family with at least equal benefits thereunder.
The Company shall not make any changes in such plans and
arrangements which would adversely affect Executive’s rights
or benefits thereunder, unless such change occurs pursuant to a
program applicable to all Executives of the Company and does not
result in a proportionately greater reduction in the rights of or
benefits to Executive as compared with any other Executives of the
Company.
(f) Options : On the
Commencement Date, the Company shall issue to Executive options to
purchase 275,000 of the Company’s ordinary shares (the
“Options”). The exercise price per share of the Options
will be equal to the fair market value per share, as quoted on the
Frankfurt Stock Exchange, on the Commencement Date. Twenty-five
percent (25%) of the Options shall vest and become exercisable
on the first anniversary of the Commencement Date and thereafter
six-and-a-quarter percent (6.25%) of the Options shall vest
and become exercisable at the end of each three-month period
following such date, such that all of the Options shall be vested
and exercisable as of the fourth anniversary of the Commencement
Date. In addition, the Options will contain a “Change of
Control Provision” whereby all unvested Options will vest if
any person acquires a vested interest in more than 50% of the
Company’s shares (except in the case of a scheme of
arrangement (“Scheme”) pursuant to Section 425 of
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