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EXHIBIT
10.1
EXECUTIVE EMPLOYMENT
AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT
(“Agreement”), effective as of November 27, 2007,
is entered into by and between Spark Networks, Inc., a Delaware
corporation (the “Company”), with its principal office
at 8383 Wilshire Boulevard, Suite 800, Beverly Hills,
California 90211, and Brett Zane, an individual residing at
[address] (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 December 20, 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 Financial
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
$255,000 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. 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. Executive’s initial Performance Period shall
commence on January 1, 2008.
(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 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.
(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 240,000 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
American 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 (a “Change of Control”).
However, in the event a successor company desires to retain
Executive’s services for the one-year period following a
Change of Control, such acceleration of unvested Options
and
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the payment of any proceeds from such
option acceleration shall occur in accordance with the terms and
conditions set forth under Section 5(g) below. Executive shall
be required to sign an option certificate between Executive and the
Company and the vesting and exercise of the Options shall be
subject to the terms of such option certificate and the
Company’s 2007 Omnibus Incentive Plan.
5. Termination and Severance
:
(a) Termination without Cause .
The Company may terminate this Agreement without Cause by giving
thirty (30) days written notice to the Executive. The
Executive may terminate this Agreement without Good Reason by
giving thirty (30) days written notice to the
Company.
(b) Termination upon Death or
Disability . Executive’s employment hereunder shall
terminate upon his death. If, as a result of Executive’s
incapacity due to physical or mental illness, as reasonably and in
good faith determined by the Board, Executive shall have been
absent from his duties hereunder on a full-time basis for the
entire period of three consecutive months, and within thirty
(30) days after written notice of termination is given (which
may occur before or after the end of such three-month
perio
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