Exhibit 10.1
(IFL LOGO) [y40133y4013301.gif]
September 21, 2007
Jay Larkin
Dear Jay:
It is with a great deal of pleasure that I am extending to you an offer to join
the International Fight League, Inc. (“IFL” or the “Company”) as President and
Chief Operating Officer, pursuant to the terms of this letter.  Your employment
is effective as of September 21, 2007 and you will report directly to the
Company’s Chairman and Chief Executive Officer. In your position, you will have
responsibility and decision making authority for the day-to-day operations of
the Company’s business, including event staging and television and media
production.
Your salary will initially be at the annual rate of $275,000 and we will pay you
on a semi-monthly basis in accordance with the Company’s regular payroll
procedures. On the six month anniversary of your start date, your annual salary
will increase to $325,000. You will be eligible to receive an annual bonus award
based upon, and subject to, the achievement of target annual performance
objectives established by the Board or its Compensation Committee after
consultation with you.
You will become eligible on your first day of employment to participate in the
Company’s employee benefit plans, including health care, life insurance and
disability benefits, pursuant to the terms of the relevant employee benefit
plans.  You will be entitled to vacation and sick days pursuant to Company
policy, which initially allows for 2 weeks of paid vacation and five
(5) personal days per year. You will receive customary expense reimbursement
pursuant to the Company’s regular executive officer expense reimbursement
policies, and when traveling on Company related business, you will be entitled
to one class upgrade from coach for air travel, with an airline of your
selection, and hotel accommodations at a hotel of your choice (other than at IFL
events where IFL has a block of rooms).
You will be granted stock options to purchase 500,000 shares of IFL common stock
under the Company’s 2006 Equity Incentive Plan (the “Plan”) (the “Initial
Grant”).  In addition, you will be eligible for an additional grant under the
Plan of stock options for 250,000 shares of common stock in January 2008 (the
“Subsequent Grant”). The Initial Grant and the Subsequent Grant will expire ten
years after the date of the Initial Grant, and each will have an exercise price
equal to the Fair Market Value (as defined in the Plan) on the date of its
grant. If the exercise price of the Subsequent Grant is greater than the
exercise price of the Initial Grant, then you will be entitled to receive an
award of restricted stock under the Plan for a number of shares of IFL common
stock (not to exceed 250,000 shares) equal to (i) the product of (x) the amount
by which the exercise price of the Subsequent Grant exceeds the exercise price
of the Initial Grant, multiplied by (y) 250,000, divided by (ii) the exercise
price of the Subsequent Grant. The Subsequent Grant, and any restricted stock
award required by the foregoing sentence, will be subject to approval by the
Company’s Board of Directors or a committee of the Board. All of the options and
the restricted stock granted under this paragraph will vest as to 1/12 of the
shares covered thereby after completion of your first three months of employment
with the Company and as to 1/12 of the shares covered thereby after the
completion of each three-month period of employment thereafter; provided that
you are in the employ of the Company on each such vesting date (the first 1/12
of the shares covered by the Subsequent Grant and any restricted stock awarded
under this paragraph will vest immediately upon their grant). In addition, the
foregoing equity awards will fully vest upon a “Change of Control Event” (as
defined in the Plan). These grants will be evidenced by and be subject to
separate grant agreements the Company will deliver to you, and which will become
effective upon the Company’s receipt of a counter-signed copy from you. As
permitted by the Plan, you may elect to have the Company withhold shares of
restricted stock as the shares vest in order to pay withholding taxes which may
be due upon vesting.
You will be an employee-at-will, which means that either IFL or you may
terminate your employment at any time, with or without “Cause” or “Good Reason”
and with or without notice.  If your employment is terminated for

 

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Jay Larkin Employment Letter
September 21, 2007
Page 2
“Cause” or you resign without “Good Reason,” you will not receive the
post-termination payments described below.  “Cause” shall mean (a) gross
negligence, or willful or wanton breach, by you of any of your material duties
to IFL, (b) gross malfeasance by you in the performance of your material duties
to IFL, (c) material violation by you of a material Company policy, (d) conduct
by you constituting fraud or dishonesty, or (e) you are convicted of a felony.
“Good Reason” shall mean a material breach of this agreement by IFL, including
the failure to award you the Subsequent Grant and the restricted stock award in
January 2008. If you believe that the Company has breached this agreement and
has thereby given you Good Reason to terminate you employment hereunder, which
would entitle you the severance benefits described below, you must notify the
Company of your entitlement to terminate your employment with the Company for
Good Reason within 90 days of the day on which you believe the Company has so
breached this agreement, and the Company will then have 60 days for its receipt
of your notice to cure such breach to your reasonable satisfaction.
If your employment with the Company is terminated by the Company without Cause,
or if you terminate your employment with the Company for Good Reason, the
Company will continue to pay you your then-rate of base salary for a period of
three (3) months, at the same time and in the same amounts as if your employment
had not terminated..  Any such payments shall be contingent upon your signing a
general release in substantially the form attached hereto as Annex A and shall
be less applicable federal, state, and local taxes and other appropriate payroll
deductions.  If your employment with the Company terminates, you will be
entitled to any rights guaranteed by the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (“COBRA”).  If your employment with the
Company is terminated by the Company without Cause or you terminate your
employment for Good Reason, and you elect to receive health insurance coverage
in accordance with COBRA, (a) IFL will place you on administrative leave as an
inactive employee during your three month severance period, during which IFL
will continue to pay on your behalf any required premiums for such health
insurance coverage, and then (b) for any period thereafter in which you are
eligible for COBRA benefits, IFL will pay any required premiums for a
three-month period following the date your three-month administrative leave
terminates.  Any such premium payments will also be contingent upon your signing
a general release in a form acceptable to the Company in substantially the form
of Annex A. In addition, if your employment is terminated by the Company without
Cause or you terminate your employment with the Company for Good Reason, your
stock options, restricted stock and any other equity awards you may have
received will immediately vest, and you will have one year to exercise any
unexercised stock options. Notwithstanding anything to the contrary contained in
this paragraph, should either or both of the above severance benefits payable to
you at a time when (i) any of the Company’s common stock is publicly traded on
an established securities market or otherwise, and (ii) you are a “specified
employee” of the Company within the meaning of Section 409A(a)(2)(B)(i) of the
Internal Revenue Code of 1986, as amended (the “Code”), constitute “nonqualified
deferred compensation” under Section 409A of the Code (“Section 409A”), its or
their payment shall be suspended for a period of six full calendar months,
commencing with the first calendar month next following the date of termination
of your employment with the Company, and such suspended payment amount will be
paid to you in a lump sum payment on the first day following the end of such
required payment suspension period. However, and notwithstanding anything to the
contrary contained in the immediately preceding sentence, should either or both
of such payments come within the definition of “involuntary severance” under
Section 409A, an amount up to the lesser of (a) 200% of your annual compensation
from the Company for the calendar year preceding the calendar year in which the
termination of your employment with the Company occurs, or (b) 200% of the
limitation under Section 401(a)(17) of the Code on tax-qualified retirement plan
compensation in effect for the calendar year in which the termination of your
employment with the Company occurs, shall be excluded from “deferred
compensation” as permitted under Section 409A and shall not be subject to the
above 6-month payment suspension requirement. Notwithstanding anything to the
contrary in this letter, the terms hereof will in all cases be interpreted
consistent with the intention of both the parties hereto that such terms comply
with all applicable requirements of both Section 409A and further, that neither
the Company nor you, individually or in combination, will pay or accelerate any
payment hereunder except in compliance with Section 409A.
International Fight League
424 West 33rd Street, Suite 650
New York, NY 10001
(212) 356-4000

 

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Jay Larkin Employment Letter
September 21, 2007
Page 3
Your employment with the Company is subject to your providing us with proper
documentation that you are authorized to work in the United States.  You will
also be required to sign a separate confidentiality and works for hire
agreement.
We understand that you will be working on other projects while you are employed
with IFL, and IFL agrees you may do so, so long as those other projects do not
interfere with your duties as President and Chief Operating Officer of IFL and
are not competitive with or adverse to the interests of IFL.
This offer letter represents the entire agreement between you and the Company
with respect to your employment with the Company, and supersedes any and all
other prior agreements or understandings, whether oral or written, relating to
your employment with the Company.
By signing this letter, you represent and warrant that you are not subject to
any agreement, order, judgment or decree of any kind which would prevent you
from entering into employment with IFL or from fully performing your duties as
President and Chief Operating Officer pursuant to the terms hereof.
If the foregoing is acceptable to you, please indicate your agreement and
acceptance of the terms hereof by signing two copies of this letter in the
appropriate space.  Please return both copies to me for execution as soon as
possible and I will return a fully signed copy to you. 
 
Again, I am extremely enthusiastic about you joining the IFL team!
Sincerely,
International Fight League, Inc.
Gareb Shamus
Chairman and Chief Executive Officer
Agreed to and accepted by:

                           
Jay Larkin
      Date    

International Fight League
424 West 33rd Street, Suite 650
New York, NY 10001
(212) 356-4000

 

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Annex A
Form of Release and Covenant Not to Sue
      (a) Executive, in consideration of the monies and other consideration paid
to him pursuant to this Agreement, releases and forever discharges the Company
and the Company’s current, former, and future controlling shareholders,
subsidiaries, affiliates, related companies, divisions, directors, trustees,
officers, employees, agents, attorneys, successors, and assigns (and the
current, former and future controlling shareholders, directors, trustees,
officers, employees, agents, and attorneys of such controlling shareholders,
subsidiaries, affiliates, related companies and divisions), and all persons
acting by, through, under, or in concert with any of them (the Company, and the
foregoing other persons and entities are hereinafter defined separately and
collectively as the “Releasees”), from all actions, causes of action, claims,
and demands whatsoever, whether known or unknown, in law or equity, whether
statutory or common law, whether federal, state, local, or otherwise, for any
claims related to, or arising out of any aspect of Executive’s employment with
the Company, any agreement concerning such employment, or the termination of
such employment, including, but not limited to, any and all claims of wrongful
discharge or breach of contract, any and all claims for equitable estoppel, any
and all claims for employee benefits, including, but not limited to, any and all
claims under the Employee Retirement Income Security Act of 1974, as amended,
the Family and Medical Leave Act of 1993, and any and all claims of employment
discrimination on any basis or of unlawful retaliation, including, but not
limited to, any and all claims under Title VII of the Civil Rights Act of 1964,
as amended, under the Age Discrimination in Employment Act of 1967, as amended
(“ADEA”), under the Civil Rights Act of 1866, 42 U.S.C. § 1981, as amended,
under the Americans With Disabilities Act of 1990, under the Civil Rights Act of
1991, under the Sarbanes-Oxley Act of 2002, under the Immigration Reform and
Control Act of 1986, as amended, under the New York State Labor Law, as amended,
under the New York State Human Rights Law, as amended, and under the New York
City Human Rights Law, as amended; and any claim for attorneys’ fees, experts’
fees, disbursements or costs; which against the Releasees, Executive,
Executive’s heirs, executors, administrators, or assigns ever had, now have, or
hereafter may have, by reason of any matter, cause, or thing whatsoever from the
beginning of the world to the date of Executive’s execution of this Agreement.
           (b) Notwithstanding anything to the contrary set forth in paragraph
(a), the Company and Executive agree that, by entering into this Agreement:
(x) Executive does not waive rights or claims that may arise after the date the
Agreement is executed; or (y) Executive does not waive or release the Releasees,
or any of them, from claims that may arise under this Agreement.
           (c) Except as set forth on Schedule A attached hereto, Executive
represents and warrants that he has never commenced or filed, and Executive
covenants and agrees never to commence, file, aid, or in any way prosecute or
cause to be commenced or prosecuted, any claims or actions against the Releasees
or any of them relating to employment matters.
           (d) Executive further acknowledges, represents, and warrants that
Executive has not reported any purported improper, unethical or illegal conduct
or activities by the Company or any Company representative to any supervisor,
manager, agent or other representative of the Company (including its Board of
Directors) or to any member of the Company’s legal or compliance personnel.
Notwithstanding the foregoing, nothing in this Agreement shall prohibit or
restrict Executive from (i) making any disclosure of information required by
law; (ii) providing information to, or testifying or otherwise assisting in, any
investigation or proceeding brought by any federal, state or local regulatory or
law enforcement agency or legislative body, any self-regulatory organization, or
the Company’s legal or compliance personnel or to legal advisers and consultants
retained by Executive for such purposes; or (iii) testifying, participating in
or otherwise assisting in a proceeding relating to an alleged violation of the
Sarbanes-Oxley Act of 2002, or any federal, state or municipal law relating to
fraud or any rule or regulation of the Securities and Exchange Commission, or
any self-regulatory organization.
           (e) Executive agrees that neither he nor any person authorized by him
to act on his behalf shall, directly or indirectly, intentionally defame or
disparage the Company or any director or officer of the Company to the media or
in a public forum or, with the intent to damage the Company or any director or
officer of the Company. Neither the Company (acting in a formal capacity through
an authorized representative) nor any officer or director of the Company shall,
directly or indirectly, intentionally defame or disparage Executive to the media
or in a public forum or, with the intent to damage Executive.