EXHIBIT 10.1

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (“Agreement”) is made effective as of
February 12, 2007 (“Effective Date”), by and between Spark Networks plc, a
public limited company incorporated under the laws of England and Wales
(“Company”) and Adam S. Berger (“Executive”).

The parties agree as follows:

1. Employment. The Company hereby employs Executive, and Executive hereby
accepts such employment, upon the terms and conditions set forth herein.

2. Duties.

2.1 Position. Executive is employed on a full-time basis as Chief Executive
Officer, shall report directly to the Board of Directors of the Company (the
“Board”), and shall have the duties and responsibilities commensurate with such
position as shall be reasonably and in good faith determined from time to time
by the Board. The parties expect that Executive will report to the Company and
commence his duties under this Agreement on or about February 21, 2007.
Executive shall also continue to serve on the Board. Executive, however,
acknowledges that in the event that he is not re-elected as a director of the
Company by the stockholders from time to time in accordance with the Company’s
articles of association or other applicable constitutional documents, subject to
the Company’s compliance with Section 2.2 the resulting termination of his
position as a director will not affect his position as an employee and Chief
Executive Officer of the Company and this Agreement will not be terminated
solely as a result of such termination of his directorship

2.2 Duties. Except for vacation and illness periods, Executive shall devote
substantially all of his business time, energy, skill and efforts to the
performance of his duties hereunder in a manner that will faithfully and
diligently further the business interests of the Company, provided, that,
notwithstanding the foregoing, Executive may (i) make and manage personal
business investments of his choice, (ii) serve as a director or in any other
capacity of any business enterprise, including an enterprise whose activities
may involve or relate to the business of the Company, provided that such service
is not to a business enterprise that competes with a “Company Business,” as
defined in Section 9 of this Agreement, and (iii) serve in any capacity with any
civic, educational, religious or charitable organization, or any governmental
entity or trade association. In addition, during Term of Employment, subject to
the Company’s articles of association and the rules and requirements of the
charter of the nominating and corporate governance committee of that Board, the
Company shall cause Executive to be nominated as a member of the Board and the
Board shall not take any action to remove Executive from the Board (the
obligation to nominate and for the Board to not remove will continue even if
Executive is not re-elected in any year). Executive agrees to serve as a member
of the Board.

3. Term of Employment. The term of Executive’s employment with the Company under
this Agreement shall commence on the Effective Date and shall continue until
December 31, 2010, unless earlier terminated as herein provided (the “Initial
Term”). As used herein, “Term of Employment” shall include the Initial Term and
any additional term that may be agreed to by the Company and Executive (the
“Extended Term”), but the Term of Employment shall end upon any termination of
Executive’s employment with the Company as herein provided.

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4. Compensation.

4.1 Base Salary. As compensation for Executive’s performance of Executive’s
duties, the Company shall pay to Executive a base salary of $350,000 per year
(“Base Salary”), payable in accordance with the normal payroll practices of the
Company, less all legally required or authorized payroll deductions and tax
withholdings. Base Salary shall be reviewed annually, and may be increased, at
the sole discretion of the Board’s Compensation Committee, in light of
Executive’s performance and the Company’s financial performance and other
economic conditions and relevant factors, but may not be decreased at anytime
without Executive’s written consent.

4.2 Annual Bonus. The Company shall pay an annual bonus to Executive based on a
performance plan established by the Board of Directors for each fiscal year
during the Term of Employment (the “Annual Bonus”). With the exception of the
fiscal year ending December 31, 2007, the performance plan 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 plan for the
fiscal year ending December 31, 2007, shall begin on the Execution Date of this
Agreement. The performance goals under the performance plan shall be set by the
Board, with the input of Executive and the Board’s Compensation Committee, and
shall be based on the following metrics: (i) Company gross revenue, (ii) Company
earnings before interest, depreciation and amortization (“EBITDA”), and
(iii) management objectives. The performance plan for each fiscal year during
the Term of Employment shall be incorporated into this Agreement by reference.
Except as otherwise provided by Section 8 of this Agreement, to be eligible for
an annual incentive bonus, Executive must maintain continued employment with the
Company throughout the relevant performance period. The Annual Bonus payable
under the performance plan shall be paid to Executive as soon as reasonably
practical upon the release of audited financial statements but in no event later
than two and one-half (2-1/2) months from the last day of each performance
period. The target Annual Bonus payable to Executive under the performance plan
shall be three-hundred thousand dollars ($300,000) (the “Target Annual Bonus”).
The minimum and maximum Annual Bonus payable under the performance plan shall be
seventy-five thousand dollars ($75,000) and four-hundred and fifty thousand
dollars ($450,000), respectively. The Board or the Compensation Committee may
increase (but not decrease) the amount of the Target Annual Bonus and the
maximum and minimum Annual Bonus payable and may also develop separate bonus
plans. Notwithstanding the foregoing, for the fiscal year ending December 31,
2007, Executive shall be entitled to a minimum guaranteed Annual Bonus based on
the following formula:

 

$100,000    X   

Number of Days between the

Execution Date and December 31, 2007

 

      360

4.3 Retention Bonus. For each fiscal year during the Term of Employment,
Executive shall be paid a retention bonus in the amount of fifty thousand
dollars ($50,000) (the “Retention Bonus”). Such Retention Bonus shall be paid to
Executive in the first payroll cycle of the year following the fiscal year in
which it is earned. Notwithstanding the foregoing, in the event Executive’s
employment with Company is terminated for any reason, the Retention Bonus shall
be payable to Executive immediately on the date of such termination of
employment.

 

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4.4 Stock Options.

(a) Concurrent with the execution of this Agreement, Executive shall be granted
an option pursuant to the Company’s 2004 Share Option Scheme (the “Plan”) to
purchase one million thirty thousand (1,030,000) shares of the Company’s
ordinary shares (the “Shares”). Such option shall be granted with an exercise
price equal to the Fair Market Value of the underlying stock on the Execution
Date and such option shall provide for a term of ten (10) years. So long as
Executive’s employment relationship with the Company continues, the Shares
underlying the option shall vest and become exercisable in accordance with the
following schedule: Two-hundred fifty-seven thousand five hundred
(257,500) Shares shall vest and become exercisable on the first anniversary of
the Execution Date (“Initial Vesting Date”) and 1/36th of the remaining seven
hundred seventy-two thousand five hundred (772,500) Shares shall vest and become
exercisable on each monthly anniversary of the Initial Vesting Date such that
all of the Shares will be fully vested and exercisable on the four year
anniversary of the Execution Date. In addition, such options shall be subject to
the terms and conditions of the Plan and a form of option agreement (the “Option
Agreement”) reflecting (and not inconsistent with) the terms set forth in this
Agreement between the Company and Executive, which documents are incorporated
herein by reference.

(b) In addition to the stock option award under Section 4.4(a), concurrent with
the execution of this Agreement, Executive shall also be granted a separate
option pursuant to the Plan to purchase two hundred thousand (200,000) Shares.
The exercise price of the option granted under this Section 4.4(b) shall be
equal to one hundred and twenty-five percent (125%) of the Fair Market Value of
the underlying stock on the Execution Date and shall provide for a term of ten
(10) years. So long as Executive’s employment relationship with the Company
continues, the Shares underlying the option shall vest and become exercisable in
accordance with the following schedule: Fifty thousand (50,000) Shares shall
vest and become exercisable on the Initial Vesting Date and 1/36th of the
remaining one hundred and fifty-five thousand (150,000) Shares shall vest and
become exercisable on each monthly anniversary of the Initial Vesting Date such
that all of the Shares will be fully vested and exercisable on the four year
anniversary of the Execution Date. In addition, such options shall be subject to
the terms and conditions of the Plan and a form of option agreement (the “Option
Agreement”) reflecting (and not inconsistent with) the terms set forth in this
Agreement between the Company and Executive, which documents are incorporated
herein by reference.

(c) In addition to the stock option awards under Sections 4.4(a) and (b),
effective on the date that Executive reports to the Company and commences to
perform duties as an employee of the Company under this Agreement, Executive
shall also be granted a separate option pursuant to the Plan to purchase seventy
thousand (70,000) Shares, which option shall be an “incentive stock option” with
respect to the maximum number of Shares allowable by the Internal Revenue Code
of 1986, as amended, and which shall be a non-qualified stock option with
respect to the balance of the Shares subject to the option. The exercise price
of the option granted under this Section 4.4(c) shall be equal to the Fair
Market Value of the underlying stock on the date of grant and shall provide for
a term of ten (10) years. So long as Executive’s employment relationship with
the Company continues, the Shares underlying the option shall vest and become
exercisable in accordance with the following schedule: Seventeen thousand five
hundred (17,500) Shares shall vest and become exercisable on the one-year
anniversary of the date of grant, which shall be the date Executive commences
employment with the Company (the “ISO Initial Vesting Date”) and 1/36th of the
remaining fifty-two thousand five hundred (52,500) Shares shall vest and become
exercisable on each monthly anniversary of the ISO Initial Vesting Date such
that all of the Shares will be

 

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fully vested and exercisable on the four year anniversary of the Execution Date.
The Company agrees to promptly take all actions that are necessary to allow such
options to qualify as “incentive stock options.” In addition, such options shall
be subject to the terms and conditions of the Plan and a form of option
agreement (the “Option Agreement”) reflecting (and not inconsistent with) the
terms set forth in this Agreement between the Company and Executive, which
documents are incorporated herein by reference.

(d) For purposes of the Agreement, “Fair Market Value” shall mean the closing
price of the Company’s Global Depositary Shares on the Execution Date as traded
on the Frankfurt Stock Exchange, the principal exchange on which the Company’s
Global Depositary Shares are traded on the Effective Date.

(e) If the proposed reorganization (however accomplished) announced by the
Company on February 8, 2007 is effected, an appropriate and equitable adjustment
shall be made in the number, exercise price and kind of Shares as to which all
outstanding stock options granted to Executive, or portions thereof then
unexercised, shall be exercisable, to the end that after the reorganization
Executive’s proportionate interest shall be maintained as before the occurrence
of such reorganization and the economic value of all of Executive’s options is
preserved.

(f) The Company represents and warrants to Executive that the terms of the Plan
do not conflict with and will not prevent the option grants and the terms and
treatment of the options contemplated anywhere in this Agreement. To the extent
that after the date hereof the Company, the board or any committee thereof has
under the terms of the Plan any discretion with respect to the interpretation of
the Plan or the power to make any decisions under the Plan, such discretion
shall be exercised and decisions made in a manner to give full effect to the
intent of this Agreement with respect to the options.

5. Health and Welfare Benefits. Executive shall be eligible for all health and
welfare benefits generally available to full-time employees of the Company,
subject to the terms and conditions of the Company’s policies and benefit plan
documents. However, Company shall pay one hundred percent (100%) of the cost of
coverage for all Company health and welfare benefits, and shall reimburse
Executive for any COBRA payments paid by Executive for coverage under the health
and welfare plans of Executive’s prior employer until Executive is eligible to
participate in the Company’s health and welfare benefit plans.

6. Vacation. Notwithstanding the standard vacation policy provisions on vacation
accrual rates, Executive shall be entitled to earn vacation at the rate of
twenty (20) days per year.

7. Business and Personal Expenses. Executive shall be reimbursed promptly for
all reasonable, out-of-pocket business expenses incurred in the performance of
Executive’s duties on behalf of the Company. Such business expenses shall
include the costs incurred by Executive for cellular telephone hardware and
usage fees, facsimile hardware and usage fees, DSL hardware and usage fees and
up to seven thousand five hundred dollars ($7,500) per year in business related
education and training. In addition, the Company shall reimburse Executive for
any reasonable legal fees incurred in connection with this Agreement, the
negotiation and execution of any new employment agreements of any successor
organization in connection with a Change in Control and any future agreements
with the Company entered into upon Executive’s termination of employment. To
obtain reimbursement, expenses must be submitted promptly with appropriate
supporting documentation and must be submitted within the same fiscal year in
which they were incurred or within two and one-half (2 1/2) months after the end
of such year.

 

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8. Termination of Employment. Subject to the terms and conditions of this
Section 8, either the Company or Executive may terminate Executive’s employment
at any time, with or without Cause (as defined in Section 8.9), during the Term
of Employment. Any termination of Executive’s employment during the Term of
Employment shall be communicated by written notice of termination from the
terminating party to the other party (“Notice of Termination”). The Notice of
Termination shall indicate the specific provision(s) of this Agreement relied
upon in effecting the termination and a written statement of the reason(s) for
the termination. In the case of a Notice of Termination provided by Executive to
the Company, such Notice of Termination shall not be effective for a period of
thirty (30) days after receipt of such Notice of Termination by the Company. In
the case of a Notice of Termination provided by the Company to Executive, such
Notice of Termination shall be effective on the date designated by the Company
in the Notice of Termination. In the event Executive’s employment is terminated
by either party, for any reason, during the Term of Employment, the Company
shall pay the prorated Base Salary earned as of the date of Executive’s
termination of employment and the accrued but unused vacation as of the date of
Executive’s termination of employment to Executive upon Executive’s termination
of employment. Except as otherwise provided in this Section 8 or in any other
agreement between the Company and Executive, the Company shall have no further
obligation to make or provide to Executive, and Executive shall have no further
right to receive or obtain from the Company, any payments or benefits in respect
of the termination of Executive’s employment with the Company during the Term of
Employment.

8.1 Severance Upon Involuntary Termination without Cause and Termination by
Executive with Good Reason. In the event that the Company causes to occur an
involuntary termination without Cause (as defined in Section 8.9) or in the
event that Executive resigns from employment with the Company for Good Reason
(as defined in Section 8.9) during the Term of Employment, Executive shall be
entitled to a “Severance Package” that consists of the following: (a) a single
cash lump-sum “Severance Payment” equal to the Retention Bonus plus one hundred
percent (100%) of the annual Base Salary in effect immediately prior to
Executive’s termination of employment, (b) reimbursement of any COBRA payments
paid by Executive in the twelve (12) month period following Executive’s
termination of employment, and (c) immediate vesting of the lesser of (x) three
hundred and twenty-five thousand stock-option Shares (it being understood the
Executive will have the discretion to elect which of the shares subject to the
options granted under Section 4.4 will vest), or (y) the remaining unvested
stock-option Shares granted under Section 4.4, and Executive shall also have one
year to exercise all vested options held by Executive immediately following
Executive’s termination of employment; provided, however, that Executive
executes a Separation Agreement that includes a general mutual release by the
Company and Executive in favor of the other and their successors, affiliates and
estates to the fullest extent permitted by law, drafted by and in a form
reasonably satisfactory to the Company and Executive, and Executive does not
revoke the mutual general release within any legally required revocation period,
if applicable. All legally required and authorized deductions and tax
withholdings shall be made from the Severance Payment, including for wage
garnishments, if applicable, to the extent required or permitted by law. The
Company shall deliver the entire Severance Payment to Executive on the date the
Company causes to occur an involuntary termination without cause or within
fifteen (15) days of the date of Executive’s resignation if Executive resigns
for Good Reason. Effective immediately upon termination of employment, Executive
shall no longer be eligible to contribute to or to receive additional Company
contributions as an active participant in any retirement or benefit plan
covering employees of the Company, but shall continue to have all rights under
each such plan that are afforded to terminated employees and inactive
participants.

 

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8.2 Change in Control; Severance Upon Termination Following a Change in Control.
In the event of a Change in Control (as defined in Section 8.9), Executive shall
be entitled to immediate vesting of all unvested stock options held by Executive
immediately prior to the Change in Control. However, in the event a successor
company desires to retain Executive’s services for the one-year period following
a Change in Control, such acceleration of unvested options and the payment of
any proceeds from such option acceleration shall occur in accordance with the
terms and conditions set forth under Section 8.3 below. In addition, in the
event that within twelve (12) months following a Change in Control, the Company
or its successor causes to occur an involuntary termination without Cause (as
defined in Section 8.9) or in the event that Executive resigns from employment
with the Company for Good Reason (as defined in Section 8.9), Executive shall be
entitled to the Severance Package provided under Section 8.1, except that the
vesting of all of Executive’s unvested stock options shall have accelerated
immediately prior to the Change in Control; provided, however, that Executive
executes a Separation Agreement that includes a general mutual release by the
Company and Executive in favor of the other and their successors, affiliates and
estates to the fullest extent permitted by law, drafted by and in a form
reasonably satisfactory to the Company and Executive, and Executive does not
revoke the mutual general release within any legally required revocation period,
if applicable. All legally required and authorized deductions and tax
withholdings shall be made from the Severance Payment, including for wage
garnishments, if applicable, to the extent required or permitted by law. The
Company shall deliver the entire Severance Payment to Executive on the date the
Company causes to occur an involuntary termination without cause or within
fifteen (15) days of the date of Executive’s resignation if Executive resigns
for Good Reason. Effective immediately upon termination of employment, Executive
shall no longer be eligible to contribute to or to receive additional Company
contributions as an active participant in any retirement or benefit plan
covering employees of the Company, but shall continue to have all rights under
each such plan that are afforded to terminated employees and inactive
participants.

8.3 Continuation of Employment After Change in Control. In the event a successor
company desires to retain Executive’s services for the one-year period following
a Change in Control on all of the terms and conditions set forth in this
Agreement, this Agreement shall continue to remain in force and effect and any
cash or other proceeds received by Executive with respect to fifty percent
(50%) of Executive’s options the vesting of which was accelerated under
Section 8.2 by reason of the Change in Control (the “Accelerated Proceeds”)
shall be deposited in an escrow (the “Escrow”) with an independent escrow holder
to be held for Executive’s benefit pursuant to an escrow agreement which shall
provide that (i) if Executive’s employment with the successor company is
terminated during the one-year period following the Change in Control by the
successor company for Cause or by Executive without Good Reason, Executive shall
forfeit the Accelerated Proceeds (and any earnings thereon) and they shall be
paid to the predecessor company immediately and (ii) the Accelerated Proceeds
(and any earnings thereon) shall be paid to Executive immediately upon earlier
of (x) the first anniversary of the Change in Control if Executive maintains
continuous employment with the successor company throughout the one-year period
following such Change in Control date (y) the date of Executive’s termination of
employment with the successor company if Executive’s employment is terminated
for any reason other than by the successor company for Cause or by Executive
without Good Reason. Any taxes due on the Accelerated Proceeds shall be withheld
and paid from the Escrow at the appropriate time.

 

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8.4 Section 409A Compliance. The parties intend for this Agreement either to
satisfy the requirements of Section 409A or to be exempt from the application of
Section 409A, and this Agreement shall be construed and interpreted accordingly.
If this Agreement either fails to satisfy the requirements of Section 409A or is
not exempt from the application of Section 409A, then the parties hereby agree
to amend or to clarify this Agreement in a timely manner so that this Agreement
either satisfies the requirements of Section 409A or is exempt from the
application of Section 409A.

(a) Notwithstanding any provision in this Agreement to the contrary, in the
event that Executive is a “specified employee” (as defined in Section 409A), any
Severance Payment, severance benefits or other amounts payable under this
Agreement that would be subject to the special rule regarding payments to
“specified employees” under Section 409A(a)(2)(B) of the Code (together,
“Specified Employee Payments”) shall not be paid before the expiration of a
period of six months following the date of Executive’s termination of employment
(or before the date of Executive’s death, if earlier). The Specified Employee
Payments to which Executive would otherwise have been entitled during the
six-month period following the date of Executive’s termination of employment
shall be accumulated and paid as soon as administratively practicable following
the first date of the seventh month following the date of Executive’s
termination of employment, with interest on each of the Specified Employee
Payments for the period of deferral, at the prime rate, as published in the Wall
Street Journal (which shall be adjusted on the effective date of each change in
such rate) plus 300 basis points.

(b) To the extent necessary to ensure satisfaction the requirements of
Section 409A(b)(3) of the Code, assets shall not be set aside, reserved in a
trust or other arrangement, or otherwise restricted for purposes of the payment
of amounts payable under this Agreement.

(c) The Company hereby informs Executive that the federal, state, local, and/or
foreign tax consequences (including without limitation those tax consequences
implicated by Section 409A) of this Agreement are complex and subject to change.
Executive acknowledges and understands that Executive should consult with his or
her own personal tax or financial advisor in connection with this Agreement and
its tax consequences. Executive understands and agrees that the Company has no
obligation and no responsibility to provide Executive with any tax or other
legal advice in connection with this Agreement and its tax consequences.
Executive agrees that Executive shall bear sole and exclusive responsibility for
any and all adverse federal, state, local, and/or foreign tax consequences
(including without limitation any and all tax liability under Section 409A) of
this Agreement to which he may be subject under applicable law. The Company
shall bear sole and exclusive responsibility for any and all adverse federal,
state, local, and/or foreign tax consequences (including without limitation any
and all tax liability under Section 409A) of this Agreement to which it may be
subject under applicable law.

8.5 Effect of Death or Disability. In the event that Executive dies or
terminates employment by reason of a Disability (as defined in Section 8.9)
during the Term of Employment, Executive shall be entitled to (i) payment of his
Retention Bonus and unpaid prorated Base Salary earned as of the date of
Executive’s death or Disability (the “Measurement Date”), (ii) reimbursement of
any COBRA payments paid by Executive or his estate or beneficiaries in the
twelve (12) month period following Measurement Date and (iii) and a single cash
lump-sum payment equal to the minimum bonus specified in this Agreement that
otherwise would have been payable to Executive for the Company’s fiscal year in
which the Measurement Date occurs multiplied by a fraction, the numerator of
which is the number of days that have

 

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elapsed between the beginning of the fiscal year in which the Measurement Date
occurs and the Measurement Date and the denominator of which is the number of
days in the fiscal year in which the Measurement Date occurs. All legally
required and authorized deductions and tax withholdings shall be made from the
payments described in the previous sentence, including for wage garnishments, if
applicable, to the extent required or permitted by law. Payment under this
Section 8.5 shall be made not more than once, if at all.

8.6 Statement Regarding Termination of Employment. In the event Executive’s
employment is terminated without Cause, or Executive resigns for Good Reason,
Executive and the Company will negotiate in good faith to reach an agreement on
a statement reflecting a benign reason for termination or resignation.

8.7 Ineligibility For Severance. Executive shall not be entitled to any
Severance Package under this Agreement, if at any time during the Term of
Employment, either (a) Executive voluntarily resigns or otherwise terminates
employment with the Company other than for Good Reason, or (b) the Company
properly terminates Executive’s employment with Cause. Effective immediately
upon termination of employment, Executive shall no longer be eligible to
contribute to or to be an active participant in any retirement or benefit plan
covering employees of the Company.

8.8 Taxes and Withholdings. The Company may withhold from any amounts payable
under this Agreement, including any benefits or Severance Payment, such federal,
state or local taxes as may be required to be withheld pursuant to applicable
law or regulations, which amounts shall be deemed to have been paid to
Executive.

8.9 Definitions.

(a) “Cause” shall mean the occurrence during the Term of Employment of any of
the following: (i) formal admission to (including a plea of guilty or nolo
contendere to), or conviction of a felony, or any criminal offence involving
Executive’s moral turpitude under any applicable law, (ii) gross negligence or
willful misconduct by Executive in the performance of Executive’s material
duties required by this Agreement which is likely to materially damage the
Company’s financial position; or (iii) material breach of this Agreement by
Executive which breach has been communicated to Executive in the form of a
written notice from the Board, and that Executive has not substantially cured
within thirty (30) days following receipt by Executive of such written notice.

(b) “Change in Control” shall mean (i) any “person” (as such term is used in
Sections 13(d) and 14(d) of the 1934 Securities Exchange Act) or group becomes
the “beneficial owner” (as defined in Rule 13d-3 of the 1934 Securities Exchange
Act) or has the right to acquire beneficial ownership, directly or indirectly,
of securities of the Company representing fifty percent (50%) or more of the
total voting power represented by the Company’s then outstanding voting
securities; (ii) the consummation of the sale, lease or other disposition by the
Company of all or substantially all of the Company’s assets (including any
equity interests in subsidiaries); (iii) the consummation of a liquidation or
dissolution of the Company; (iv) the consummation of a merger, consolidation,
business combination, scheme of arrangement, share exchange or similar
transaction involving the Company and any other corporation (“Business
Combination”), other than a Business Combination which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or its parent) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Company or such surviving entity or its parent outstanding

 

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immediately after such Business Combination or (v) any combination of the
foregoing. Notwithstanding the foregoing, a Change in Control shall not be
deemed to occur solely as a result of (x) a repurchase or redemption of
securities (which is open to all stockholders) by the Company done in the
ordinary course of business and the purpose of which is not to effect a Change
of Control or (y) a rights issue, recapitalization, capitalization, sub-division
or consolidation or a share capital reduction and any other variation of the
capital of the Company and/or rights in respect thereof, or capital distribution
(being any distribution, whether in cash or in other specie, out of capital
profits or capital reserves (including share premium account and any capital
redemption reserve fund)) so long as in each instance it is done either as part
of a reincorporation merger or in the ordinary course of business and in any
event is not done to effect a Change of Control.

(c) “Disability” shall mean, to the extent consistent with applicable federal
and state law (including, without limitation Section 409A), Executive’s
inability by reason of physical or mental illness to fulfill his obligations
hereunder for ninety (90) consecutive days or for a total of one hundred and
eighty (180) days in any twelve (12) month period which, in the reasonable
opinion of an independent physician selected by the Company or its insurers and
reasonably acceptable to Executive or Executive’s legal representative, renders
Executive unable to perform the essential functions of his job, even after
reasonable accommodations are made by the Company. The Company is not, however,
required to make unreasonable accommodations for Executive or accommodations
that would create an undue hardship on the Company.

(d) “Good Reason” shall mean the occurrence during the Term of Employment of any
of the following: (i) a material breach of this Agreement by the Company which
is not cured by the Company within thirty (30) days following the Company’s
receipt of written notice by Executive to the Company describing such alleged
breach; (ii) Executive’s Base Salary, Retention Bonus, Annual Bonus target,
maximum or minimum or other bonus opportunity is reduced by the Company or the
terms and conditions for stock option agreements are not fully complied with by
the Company; (iii) a reduction in Executive’s title, a reduction in Executive’s
duties and/or responsibilities, or the assignment to Executive of any duties
inconsistent with Executive’s position; or (iv) a requirement by the Company,
without Executive’s consent, that Executive relocate to a location greater than
thirty-five (35) miles from Executive’s place of residence; (v) the Company
provides Executive with notice of non-renewal of this Agreement; or (vi) the
circumstances described in the last sentence of Section 13.7.3.

(e) “Section 409A” means Section 409A of the Internal Revenue Code of 1986, as
amended, and all applicable guidance promulgated thereunder.

8.10 Nonduplication of Benefits. Notwithstanding any provision in this Agreement
or in any other Company benefit plan or compensatory arrangement to the
contrary, but at all times subject to Section 8.4, (a) any payments due under
either Section 8.1 or Section 8.2 shall be made not more than once, if at all,
(b) payments may be due under either Section 8.1 or Section 8.2, but under no
circumstances shall payments be made under both Section 8.1 and Section 8.2, and
(c) Executive shall not be entitled to severance benefits from the Company other
than as contemplated under this Agreement, unless such other severance benefits
offset and reduce the benefits due under this Agreement on a dollar-for-dollar
basis, but not below zero.

9. No Competition and No Conflict of Interest. Except as otherwise provided in
Section 2.2 of this Agreement, during the Term of Employment, Executive must not
engage in any work, paid or unpaid, that creates an actual conflict of interest
with the Company Business

 

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where such conflict would materially and substantially disrupt operations. Such
work shall include directly or indirectly competing with the Company Business,
or acting as an officer, director, employee, consultant, stockholder, volunteer,
lender, or agent of any business enterprise which is in direct competition with
the Company Business (in each case where it would materially and substantially
disrupt operations). Notwithstanding the foregoing, Executive’s investment in,
or ownership of, less than five percent (5%) of the capital stock of any
business entity that competes with the Company Business and whose securities are
traded on any national securities exchange or registered pursuant to
Section 12(g) of the Securities Exchange Act of 1934, shall not be treated as a
breach of this Section 8. For purposes of this Agreement, the term “Company
Business” shall mean an online personals service or internet dating.

10. Confidentiality. During the Term of Employment, Executive has been and will
continue to be given access to a wide variety of information about the Company,
its affiliates and other related businesses that the Company considers
“Confidential Company Information.” As a condition of continued employment,
Executive agrees to abide by the Company’s reasonable and written business
policies and directives on confidentiality and nondisclosure of “Confidential
Company Information.” “Confidential Company Information” shall mean all
information applicable to the business of the Company which confers a
competitive advantage upon the Company over one who does not possess the
information; and has commercial value in the business of the Company or any
other business in which the Company engages or is preparing to engage during
Executive’s employment with the Company. “Confidential Company Information”
includes, but is not limited to, information regarding the Company’s business
plans and strategies; contracts and proposals; and other business partners and
the Company’s business arrangements and strategies with respect to them; current
and future marketing or advertising campaigns; software programs; codes,
formulae or techniques; financial information; personnel information; and all
ideas, plans, processes or information related to the current, future and
proposed projects or other business of the Company that has not been disclosed
to the public by an authorized representative of the Company, acting within the
scope of his or her authority, whether or not such information would be
enforceable as a trade secret of the Company or enjoined or restrained by a
court or arbitrator as constituting unfair competition. “Confidential Company
information” also includes confidential information of any third party who may
disclose such information to the Company or Executive in the course of the
Company’s business.

10.1 Continuing Obligation. Executive agrees that the agreement not to disclose
Confidential Company Information will be effective during Executive’s employment
and continue even after Executive is no longer employed by the Company. Any
obligation not to disclose any portion of any Confidential Company Information
will continue for two (2) years after the date Executive’s employment is
terminated unless such information (a) has become public knowledge through no
fault of Executive; or (b) has been developed independently without any
reference to any information obtained during Executive’s employment with the
Company; (c) must be disclosed in response to a valid order by a court or
government agency or is otherwise required by law; or (d) was known by Executive
prior to the date hereof or later becomes known to Executive outside the scope
of his employment. Nothing in this Section 10 shall be interpreted to prohibit
or restrict Executive from taking any actions not prohibited by Section 11, it
being understood that Executive’s use in subsequent employment or in any other
role of his experience, general knowledge or other skills gained during
employment with the Company shall not violate this Section 10.

 

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10.2 Return of Company Property. On termination of employment with the Company
for whatever reason, or at the request of the Company before termination,
Executive agrees to promptly deliver to the Company all records, files, computer
disks, memoranda, documents, lists and other information regarding or containing
any Confidential Company Information, including all copies and reproductions
thereof, then in Executive’s possession or control, whether prepared by
Executive or others. Executive also agrees to promptly return, on termination or
the Company’s request, any and all Company property issued to Executive,
including but not limited to computers, cellular phones, keys and credits cards.
Executive further agrees that should Executive discover any Company property or
Confidential Company Information in Executive’s possession after the return of
such property has been requested, Executive agrees to return it promptly to the
Company without retaining copies of any kind.

10.3 No Violation of Rights of Third Parties. Executive warrants that the
performance of all the terms of this Agreement does not and will not breach any
agreement to keep in confidence proprietary information, knowledge or data
acquired by Executive prior to Executive’s employment with the Company.
Executive agrees not to disclose to the Company, or induce the Company to use,
any confidential or proprietary information or material belonging to any
previous employers or others. Executive warrants that Executive is not a party
to any other agreement that will interfere with Executive’s full compliance with
this Agreement. Executive further agrees not to enter into any agreement,
whether written or oral, in conflict with the provisions of this Agreement while
such provisions remain effective.

11. Interference with Business Relations.

11.1 Interference with Customers, Suppliers and Other Business Partners.
Executive acknowledges that the Company’s tenant and customer base and its other
business arrangements have been developed through substantial effort and
expense, and its nonpublic business information is confidential. In addition,
because of Executive’s position, Executive understands that the Company will be
vulnerable to significant harm from Executive’s use such information for
purposes other than to further the Company’s business interests. Accordingly,
Executive agrees that during Executive’s employment with the Company, and for a
period of twelve (12) months thereafter, Executive will not knowingly,
separately or in association with others, materially and substantially interfere
with, impair, disrupt or damage the Company’s relationship with any of the
customers of the Company with whom Executive has had contact by contacting them
for the purpose of inducing or encouraging any of them to divert or take away
business from the Company and to an enterprise that is in direct competition
with the Company Business; provided, however, that none of the foregoing
restrictions shall preclude Executive from (i) being employed by a consulting,
financial or advisory firm that provides any advice or services to a person,
enterprise or business that is in competition with the Company Business so long
as Executive does not personally provide such advice or services to the
competing person, enterprise or business, (ii) becoming or acting as an
employee, consultant, partner, principal, agent, representative or equity holder
in any subsidiary, division or separate business unit of a person, enterprise or
business that is in competition with the Company Business if that subsidiary,
division or separate business unit does not itself directly engage in internet
dating and online personals or (iii) becoming or acting as an employee,
consultant, partner, principal, agent, representative or equity holder or
engaging in any other manner in any business that does not derive more than
twenty percent (20%) of its revenue from internet dating and online personals
(such exclusion does not apply to Match.com or Yahoo!Personals).

11.2 Interference with the Company’s Employees. Executive acknowledges that the
services provided by the Company’s officers and key employees are unique and
special, and that the Company’s officers and key employees possess trade secrets
and

 

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Confidential Company Information that is protected against misappropriation and
unauthorized use. As such, Executive agrees that during, and for a period of
twelve (12) months after, Executive’s employment with the Company, Executive
will not, knowingly, separately or in association with others, materially and
substantially, interfere with, impair, disrupt or damage the Company’s business
by directly contacting any Company officers or key employees for the purpose of
inducing or encouraging them to discontinue their employment with the Company;
provided, however, that the foregoing provisions shall not (i) restrict
Executive from directly or indirectly making any general solicitation for
employees, making a public advertising or participating in any job fairs or
recruiting workshops or (ii) preclude Executive from soliciting and/or hiring
any officer, key employee or other person at any time (A) in the case of
voluntary terminations, later than six (6) months after such person’s
termination of employment from the Company and (B) in the case of all other
terminations, after such person’s termination of employment from the Company.

11.3 Injunctive Relief. Executive acknowledges that Executive’s breach of the
covenants contained in Sections 9 through 11 of this Agreement inclusive
(collectively “Covenants”) would cause irreparable injury and continuing harm to
the Company for which there will be no adequate remedy at law, and agrees that
in the event of any such breach, the Company seek temporary, preliminary and
permanent injunctive relief to the fullest extent allowed by the California
Arbitration Act, without the necessity of proving actual damages or posting any
bond or other security.

12. Agreement to Arbitrate.

12.1 Any dispute or controversy arising out of or relating to any
interpretation, construction, performance, termination or breach of this
Agreement, will be settled by final and binding arbitration by a single
arbitrator to be held in Los Angeles County, California, in accordance with the
American Arbitration Association national rules for resolution of employment
disputes then in effect, except as provided herein. The arbitrator selected
shall have the authority to grant any party all remedies otherwise available by
law, including injunctions, but shall not have the power to grant any remedy
that would not be available in a state or federal court in California. The
arbitrator shall be bound by and shall strictly enforce the terms of this
Section 12 and may not limit, expand or otherwise modify its terms. The
arbitrator shall make a good faith effort to apply the substantive law (and the
law of remedies, if applicable) of the state of California, or federal law, or
both, as applicable, without reference to its conflicts of laws provisions, but
an arbitration decision shall not be subject to review because of errors of law.
The arbitrator is without jurisdiction to apply any different substantive law.
The arbitrator shall have the authority to hear and rule on dispositive motions
(such as motions for summary adjudication or summary judgment). The arbitrator
shall have the powers granted by California law and the rules of the American
Arbitration Association which conducts the arbitration, except as modified or
limited herein.

12.2 Notwithstanding anything to the contrary in the rules of the American
Arbitration Association, the arbitration shall provide (i) for written discovery
and depositions as provided in California Code of Civil Procedure
Section 1283.05 and (ii) for a written decision by the arbitrator that includes
the essential findings and conclusions upon which the decision is based which
shall be issued no later than thirty (30) days after a dispositive motion is
heard and/or an arbitration hearing has completed. Except in disputes where
Executive asserts a claim otherwise under a state or federal statute prohibiting
discrimination in employment (“a Statutory Discrimination Claim”), the Company
shall pay all fees and administrative costs charged by the arbitrator and
American Arbitration Association. In disputes where Executive asserts a
Statutory Discrimination Claim against the Company, Executive shall be required
to

 

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pay the American Arbitration Association’s filing fee only to the extent such
filing fee does not exceed the fee to file a complaint in state or federal
court. The Company shall pay the balance of the arbitrator’s fees and
administrative costs.

12.3 Executive and the Company shall have the same amount of time to file any
claim against any other party as such party would have if such a claim had been
filed in state or federal court. In conducting the arbitration, the arbitrator
shall follow the rules of evidence of the State of California (including but not
limited to all applicable privileges), and the award of the arbitrator must
follow California and/or federal law, as applicable.

12.4 The arbitrator shall be selected by the mutual agreement of the parties. If
the parties cannot agree on an arbitrator, the parties shall alternately strike
names from a list provided by the American Arbitration Association until only
one name remains.

12.5 The decision of the arbitrator will be final, conclusive and binding on the
parties to the arbitration. The prevailing party in the arbitration, as
determined by the arbitrator, shall be entitled to recover his or its reasonable
attorneys’ fees and costs, including the costs or fees charged by the arbitrator
and the American Arbitration Association. In disputes where Executive asserts a
Statutory Discrimination Claim, reasonable attorneys’ fees shall be awarded by
the arbitrator based on the same standard as such fees would be awarded if the
Statutory Discrimination Claim had been asserted in state or federal court.
Judgment may be entered on the arbitrator’s decision in any court having
jurisdiction.

13. General Provisions.

13.1 Successors and Assigns. The rights and obligations of the Company under
this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company. The Company will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise or
in connection with the proposed reorganization announced by the Company on
February 8, 2007) or assignee to all or substantially all of the business and/or
assets of the Company to assume expressly and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no such succession or assignment had taken place (provided that
the Company shall also remain liable under this Agreement). Executive shall not
be entitled to assign any of Executive’s rights or obligations under this
Agreement without the Company’s written consent, provided that upon Executive’s
death, Executive’s named beneficiaries, estate or heirs, as the case may be,
shall succeed to all of Executive’s rights under this Agreement.

13.2 Indemnification; Directors’ and Officers’ Liability Insurance.

(a) During the Term of Employment and thereafter, the Company shall indemnify
Executive to the fullest extent permitted under law (which shall initially be UK
law, but if this Agreement is assigned to a Delaware corporation shall
thereafter be Delaware law) from and against any expenses (including but not
limited to attorneys’ fees, expenses of investigation and preparation and fees
and disbursements of Executive’s accountants or other experts), judgments,
fines, penalties and amounts paid in settlement actually and reasonably incurred
by Executive in connection with any proceeding in which Executive was or is made
party or was or is involved (for example, as a witness) by reason of the fact
Executive was or is employed by or serving as an officer or director of the
Company or any of its affiliates. Such indemnification shall continue as to
Executive during the Term of Employment and for so long thereafter as Executive
may have exposure with respect to acts or omissions which occurred prior to his
cessation of employment with the Company and shall inure to the benefit of

 

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Executive’s heirs, executors and administrators. The Company shall advance to
Executive all costs and expenses incurred by him in connection with any
proceeding covered by this provision within 20 calendar days after receipt by
the Company of a written request for such advance. Such request shall include an
undertaking by Executive to repay the amount of such advance if it shall
ultimately be determined that he is not entitled to be indemnified against such
costs and expenses.

(b) The Company agrees to use its best efforts to purchase and maintain adequate
Directors’ and Officers’ liability insurance from a reputable, nationally
recognized and financially sound insurer with terms no less favorable to
Executive than those in effect as of the date of this Agreement, with coverage
limits of not less than thirty-five million dollars ($35,000,000) and with
provisions that will provide coverage for Executive as a director, officer and
employees as well as coverage as a former director, officer and employee
following any termination of this Agreement or Executive’s employment and
service on the Board. Such insurance shall inure to the benefit of Executive’s
heirs, executors and administrators

13.3 Nonexclusivity Rights. Executive is not prevented from continuing or future
participation in any Company benefit, bonus, incentive or other plans, programs,
policies or practices provided by the Company subject to the terms and
conditions of such plans, programs, or practices.

13.4 Waiver. Either party’s failure to enforce any provision of this Agreement
shall not in any way be construed as a waiver of any such provision, or prevent
that party thereafter from enforcing each and every other provision of this
Agreement.

13.5 Attorneys’ Fees. Subject to Section 12, in any action to enforce the terms
of this Agreement, the prevailing party shall be reimbursed by the
non-prevailing party for such prevailing party’s reasonable attorneys’ fees and
costs, including the costs of enforcing a judgment.

13.6 Severability. Subject to Section 13.7, in the event any provision of this
Agreement is found to be unenforceable by an arbitrator or court of competent
jurisdiction, such provision shall be deemed modified to the extent necessary to
allow enforceability of the provision as so limited, it being intended that the
parties shall receive the benefit contemplated herein to the fullest extent
permitted by law. If a deemed modification is not satisfactory in the judgment
of such arbitrator or court, the unenforceable provision shall be deemed
deleted, and the validity and enforceability of the remaining provisions shall
not be affected thereby.

13.7 Overriding Provision - Compliance with Applicable Law

13.7.1 The Company represents and warrants to Executive that (i) this Agreement
and the Option Agreement have been duly authorized, executed and delivered by
the Company, (ii) as of the date of this Agreement, no shareholder approval,
Board approval or any other action on the part of the Company or any other
person or entity is necessary to authorize the execution and delivery of this
Agreement and the Option Agreement or the performance by the Company of its
obligations hereunder or thereunder and (iii) as of the date of this Agreement,
the execution, delivery and performance of this Agreement and the Option
Agreement does not result in any breach of or result in a violation of any law,
regulation, ordinance or order or the terms of the Plan, any material contract,
any certificate of incorporation or any other organizational document of the
Company. The parties acknowledge the introduction of the Companies Act 2006 (a
statute of the UK parliament) and that when it becomes effective its provisions
will apply to the Company.

 

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13.7.2 To the extent that any law or regulation (including UK laws) becomes
effective and enforceable after the date of this Agreement that requires
shareholder approval in order for the Company to comply with one or more
provisions of this Agreement (“Shareholder Approval”), the Company undertakes to
use all reasonable efforts to seek such Shareholder Approval, and Executive
acknowledges that in the event that Shareholder Approval is sought but is not
obtained, subject to the Company’s compliance with Section 13.7.3, the Company
will not be regarded as in breach of the relevant unapproved provision(s) of
this Agreement if the Company is unable to comply with such unapproved
provision(s) as a result of such failure to obtain Shareholder Approval. If the
proposed reorganization announced by the Company on February 8, 2007 is
effected, then if requested by Executive the Company shall use all reasonable
efforts to make the provisions of the Companies Act 2006 requiring Shareholder
Approval not applicable to this Agreement, including (at Executive’s request) by
assigning this agreement to a Delaware parent or holding company.

13.7.3 In the event that:

(a) Shareholder Approval is required for any provision of this Agreement and
Shareholder Approval is sought but is not obtained; and

(b) any provision of this Agreement, or any part of a provision of this
Agreement, is found to be illegal, invalid or unenforceable due to the absence
of such Shareholder Approval;

the remaining provisions, or the remainder of the provision concerned, shall
continue in effect. In relation to any illegal, invalid or unenforceable part of
this Agreement, the Company agrees to amend such part in such manner as may be
reasonably requested by the Executive provided that such proposed amendment is
legal and enforceable and to the maximum extent possible carries out the
original intent of the parties in relation to that part. If this Agreement
cannot or is not amended in a manner that preserves the economic value (over the
four-year term) of this Agreement to Executive, then Executive will be entitled
to resign from employment with the Company for “Good Reason.”

13.8 Interpretation; Construction. The headings set forth in this Agreement are
for convenience only and shall not be used in interpreting this Agreement. This
Agreement has been drafted by legal counsel representing the Company, but
Executive has participated in the negotiation of its terms. Furthermore,
Executive acknowledges that Executive has had an opportunity to review and
revise the Agreement and have it reviewed by legal counsel, if desired, and,
therefore, the normal rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement.

13.9 Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of California. Except as and to the extent
that Section 12 does not properly apply, each party consents to the jurisdiction
and venue of the state or federal courts in Los Angeles County, California in
any action, suit or proceeding arising out of or relating to this Agreement.

 

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13.10 Notices. Any notice required or permitted by this Agreement shall be in
writing and shall be delivered as follows with notice deemed given as indicated:
(a) by personal delivery when delivered personally; (b) by overnight courier
upon written verification of receipt; (c) by telecopy or facsimile transmission
upon acknowledgment of receipt of electronic transmission; or (d) by certified
or registered mail, return receipt requested, upon verification of receipt.
Notice shall be sent to the addresses set forth below, or such other address as
either party may specify in writing.

13.11 Survival. The following provisions shall survive Executive’s employment
with The Company to the extent reasonably necessary to fulfill the parties’
expectations in entering this Agreement: Sections 7, (“Business and Personal
Expenses”), 8 (“Termination of Employment”), 12 (“Agreement to Arbitrate”), 13
(“General Provisions”), 14 (“Certain Additional Payments by the Company”) and 15
(“Entire Agreement”).

14. Certain Additional Payments by the Company.

(a) Anything in this Agreement to the contrary notwithstanding and except as set
forth below, in the event it shall be determined that any Payment would be
subject to the Excise Tax, then Executive shall be entitled to receive an
additional payment equal to the amount of the Excise Tax (the “Excise Tax
Payment”). Executive shall be responsible for payment of any additional Excise
Tax and income tax resulting from such Excise Tax Payment. The Company’s
obligation to make Excise Tax Payments under this Section 14 shall not be
conditioned upon Executive’s termination of employment.

(b) Subject to the provisions of Section 14(c), all determinations required to
be made under this Section 14, including whether and when an Excise Tax Payment
is required, the amount of such Excise Tax Payment and the assumptions to be
utilized in arriving at such determination, shall be made by the Company’s
accounting firm serving immediately prior to the Change in Control or such other
nationally recognized accounting firm as may be agreed by the Company and
Executive (the “Accounting Firm”); provided, that the Accounting Firm’s
determination shall be made based upon “substantial authority” within the
meaning of Section 6662 of the Code. The Accounting Firm shall provide detailed
supporting calculations both to the Company and Executive within 15 business
days of the receipt of notice from Executive that there has been a Payment or
such earlier time as is requested by the Company. All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any Excise Tax Payment, as
determined pursuant to this Section 14, shall be paid by the Company to
Executive within 5 days of the receipt of the Accounting Firm’s determination.
Any determination by the Accounting Firm shall be binding upon the Company and
Executive, unless the Company obtains an opinion of outside legal counsel, based
upon at least “substantial authority” within the meaning of Section 6662 of the
Code, reaching a different determination, in which event such legal opinion
shall be binding upon the Company and Executive. As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Excise Tax
Payments that will not have been made by the Company should have been made (the
“Underpayment”), consistent with the calculations required to be made hereunder.
In the event the Company exhausts its remedies pursuant to Section 14(c) and
Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid by the Company to or for the
benefit of Executive.

(c) Executive shall notify the Company in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by the Company of
the Excise

 

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Tax Payment. Such notification shall be given as soon as practicable, but no
later than 10 business days after Executive is informed in writing of such
claim. Executive shall apprise the Company of the nature of such claim and the
date on which such claim is requested to be paid. Executive shall not pay such
claim prior to the expiration of the 30-day period following the date on which
Executive gives such notice to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such claim is due). If the
Company notifies Executive in writing prior to the expiration of such period
that the Company desires to contest such claim, Executive shall:

(i) give the Company any information reasonably requested by the Company
relating to such claim,

(ii) take such action in connection with contesting such claim as the Company
shall reasonably request in writing from time to time, including, without
limitation, accepting legal representation with respect to such claim by an
attorney reasonably selected by the Company,

(iii) cooperate with the Company in good faith in order effectively to contest
such claim, and

(iv) permit the Company to participate in any proceedings relating to such
claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest, and shall indemnify and hold Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties) imposed as a result of such representation and payment of costs and
expenses. Without limitation on the foregoing provisions of this Section 14(c),
the Company shall control all proceedings taken in connection with such contest,
and, at its sole discretion, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the applicable taxing
authority in respect of such claim and may, at its sole discretion, either
direct Executive to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and Executive agrees to prosecute such contest
to a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that, if the Company directs Executive to pay such
claim and sue for a refund, the Company shall advance the amount of such payment
to Executive, on an interest-free basis, and shall indemnify and hold Executive
harmless, on an after-tax basis, from any Excise Tax or income tax (including
interest or penalties) imposed with respect to such advance or with respect to
any imputed income in connection with such advance; and provided, further, that
any extension of the statute of limitations relating to payment of taxes for the
taxable year of Executive with respect to which such contested amount is claimed
to be due is limited solely to such contested amount. Furthermore, the Company’s
control of the contest shall be limited to issues with respect to which the
Excise Tax Payment would be payable hereunder, and Executive shall be entitled
to settle or contest, as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.

(d) If, after the receipt by Executive of an Excise Tax Payment or an amount
advanced by the Company pursuant to Section 14(c), Executive becomes entitled to
receive any refund with respect to the Excise Tax to which such Excise Tax
Payment relates or with respect to such claim, Executive shall (subject to the
Company’s complying with the requirements of Section 14(c), if applicable)
promptly pay to the Company the amount of such

 

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refund (together with any interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by Executive of an amount advanced by
the Company pursuant to Section 14(c), a determination is made that Executive
shall not be entitled to any refund with respect to such claim and the Company
does not notify Executive in writing of its intent to contest such denial of
refund prior to the expiration of 30 days after such determination, then such
advance shall be forgiven and shall not be required to be repaid and the amount
of such advance shall offset, to the extent thereof, the amount of Excise Tax
Payment required to be paid.

(e) Notwithstanding any other provision of this Section 14, the Company may, in
its sole discretion, withhold and pay over to the Internal Revenue Service or
any other applicable taxing authority, for the benefit of Executive, all or any
portion of any Excise Tax Payment, and Executive hereby consents to such
withholding.

(f) Any other liability for unpaid or unwithheld Excise Taxes shall be borne
exclusively by the Company, in accordance with Section 3403 of the Code. The
foregoing sentence shall not in any manner relieve the Company of any of its
obligations under this Employment Agreement.

(g) Definitions. The following terms shall have the following meanings for
purposes of this Section 14.

(i) “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code,
together with any interest or penalties imposed with respect to such excise tax.

(ii) “Parachute Value” of a Payment shall mean the present value as of the date
of the change of control for purposes of Section 280G of the Code of the portion
of such Payment that constitutes a “parachute payment” under Section 280G(b)(2),
as determined by the Accounting Firm for purposes of determining whether and to
what extent the Excise Tax will apply to such Payment.

(iii) A “Payment” shall mean any payment or distribution in the nature of
compensation (within the meaning of Section 280G(b)(2) of the Code) to or for
the benefit of Executive, whether paid or payable pursuant to this Agreement or
otherwise.

(iv) The “Safe Harbor Amount” means 2.99 times Executive’s “base amount,” within
the meaning of Section 280G(b)(3) of the Code.

(v) “Value” of a Payment shall mean the economic present value of a Payment as
of the date of the change of control for purposes of Section 280G of the Code,
as determined by the Accounting Firm using the discount rate required by
Section 280G(d)(4) of the Code.

15. Entire Agreement. This Agreement, together with the other agreements and
documents governing the benefits described in this Agreement constitute the
entire agreement between the parties relating to this subject matter hereof and
supersedes all prior or simultaneous representations, discussions, negotiations,
and agreements, whether written or oral. This Agreement may be amended or
modified only with the written consent of Executive and the Board of Directors
of the Company. No oral waiver, amendment or modification will be effective
under any circumstances whatsoever.

 

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THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.

 

    ADAM S. BERGER Dated: February 12, 2007    

/s/ Adam S. Berger

    Address:  

 

     

 

    SPARK NETWORKS PLC Dated: February 12, 2007   By:  

/s/ David E. Siminoff

    David E. Siminoff     Chairman of the Board of Directors

 

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