Exhibit 10.5


EMPLOYMENT AGREEMENT


          AGREEMENT made as of the __ day of ______,
2008 between FRIENDFINDER NETWORKS INC., a Nevada corporation (the “Company”)
having an office at 6800 Broken Sound Parkway, Boca Raton, Florida 33487 and
DANIEL C. STATON (the “Executive”). 


                    WHEREAS,
the Company desires to employ
Executive and Executive desires to accept such employment by the Company on the
terms and subject to the conditions hereinafter set forth. 


                    NOW
THEREFORE, in consideration of the
mutual promises contained herein, the parties agree as follows: 


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


2. Term. Subject to the provisions for
termination herein provided, the employment of the Executive shall commence as
of the date of this Agreement and shall continue for a term of five (5) years
(the “Term”). 


3. Duties and Responsibilities.


          3.1
During the Term, the Executive shall have the position of Chairman of the
Company and in connection therewith, the Executive shall perform such executive
duties and responsibilities commonly incident to such office as may be assigned
to him from time to time by or under the authority of the Board of Directors of
the Company (the “Board”), and, in the absence of such assignment, such
duties customary to such offices as are necessary to the operations of the
Company. 


          3.2
The Executive’s employment by the Company shall be full-time, and during the
Term, the Executive agrees that he will devote his business time and attention,
his best efforts, and all his skill and ability to promote the interests of the
Company. Notwithstanding the foregoing,
the Executive shall be permitted to devote up to twenty percent (20%) of his
business time to such other business activities that the Executive desires,
engage in charitable and civic activities and manage his personal passive
investments; provided, however, that such activities (individually or
collectively) (a) do not interfere with the performance of his duties or
responsibilities under this Agreement and (b) do not injure the reputation,
business or business relationships of the Company or any of its affiliates as determined
by the Company in good faith. 


          3.3
The Executive’s services shall be substantially performed at the Company’s
offices in Boca Raton, Florida, subject to necessary travel requirements of his
position and duties hereunder. 


          3.4
Nothing contained herein shall require the Executive to follow any directive or
to perform any act which would violate any laws, ordinances, regulations or
rules of any governmental, regulatory or administrative body, agent or
authority, any court or judicial authority, or any public, private or industry
regulatory authority. The Executive shall act in accordance with all laws,
ordinances, regulations or rules of any governmental, regulatory or 


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administrative
body, agent or authority, any court or judicial authority, or any public,
private or industry regulatory authority. 


4. Compensation.


          4.1
Base Salary. The Company shall pay
the Executive $1,000,000 per annum (the “Base Salary”) in equal
semi-monthly installments or at such other intervals as the parties shall
agree. The Base Salary may be increased
in each fiscal year of the Company following the first anniversary of the date
hereof (the “First Anniversary”) at the rate of ten percent (10%) of the
then current Base Salary.  


          4.2
Bonus. In addition to the Base
Salary, the Executive will be eligible to receive a performance bonus during
each year of employment with the Company of up to one hundred percent (100%) of
the Base Salary. The award of each year’s performance bonus, if any, shall be
based upon the following performance criteria:
(a) seventy-five percent (75%) based on the Board’s objective evaluation
of revenue growth, successful integration of acquisitions, EBIDTA growth and
margin improvement and (b) twenty-five percent (25%) based on the Board’s
subjective evaluation of the Executive’s performance. Such determination shall be made after consultation with the
Executive within sixty (60) days of the end of each Fiscal Year during the Term
commencing with the Fiscal Year ended December 31, 2008. The Company shall pay
any performance bonus payable hereunder within ninety (90) days of the end of
the applicable Fiscal Year. The full performance bonus that may be awarded
pursuant to this Section 4.2, as it may be increased from time to time in the
discretion of the Board, shall be referred to herein as the “Bonus.” 


          4.3
Stock Options. The Company hereby
agrees to grant to the Executive an option to purchase 83,333 shares of common
stock of the Company on the date hereof and on each anniversary of the date of
this Agreement (each such grant, an “Option”). The respective exercise price per share of each Option shall be
equal to (i) if the Option is granted prior to the date of the Company’s
initial public offering of it’s common stock pursuant to an effective
registration statement filed with the Securities Exchange Commission (the “IPO”),
the price per share offered to the public pursuant to such IPO, or (ii) if the
Option is granted after the IPO, the
fair market value for each share of the common stock of the Company on
the date immediately prior to the date such Option was granted. Subject to accelerated vesting provisions
set forth in Section 6 herein, each Option shall vest as to twenty percent
(20%) of the shares subject to such Option on the first anniversary of the
grant of such Option and as to (20%) of the shares subject to such Option each
anniversary thereafter, subject to the Executive’s continued employment with
the Company on the relevant vesting dates.
In all other respects, each Option shall be subject to the terms,
definitions and provisions of the stock option agreement by and between the
Executive and the Company (the “Option Agreement”), which document is
incorporated herein by reference. In
the case of any conflict between the terms of any Option Agreement and the
terms of this Agreement, the terms of the Option Agreement will govern. 


          4.4
Restricted Stock. On the First
Anniversary and on each anniversary thereafter, the Company shall issue to the
Executive 50,000 shares of restricted stock (the “Restricted Stock”),
which stock the Executive shall not sell, transfer, assign or otherwise convey
prior to the third anniversary of the date such Restricted Stock is
issued. In the event the Executive’s
ceases to be employed by the Company, except for termination of Executive’s
employment under 


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Certain
Circumstances, the Company shall have the right to repurchase any Restricted
Stock issued less than three years prior to the date of such termination at a
price of $0.10 per share. The Company
shall provide written notice the Executive of its intention to exercise such
repurchase right no later than five (5) days after the date of termination of
employment and the repurchase of the Restricted Stock shall be consummated
within ten (10) days of such notice.  


For purposes
of this Agreement, “Certain Circumstances” shall mean the termination of
Executive’s employment (i) by the Company Without Cause (as defined in Section
5.1); or (ii) by the Executive for Good Reason (as defined in Section 5.2); or
(iii) as a result of a Change in Control (as defined in Section 6). 


          4.5
Share Adjustment. All share
amounts contemplated in Sections 4.3 and 4.4 are subject to appropriate
adjustment in the event of stock split, reverse stock split, merger,
recapitalization and similar transactions which may take place after the date
hereof. 


          4.6
Expenses. The Company shall pay or
reimburse the Executive for all reasonable out-of-pocket expenses incurred by
the Executive, accompanied by vouchers therefore in accordance with the
Company’s policies, in the course of providing management services to the
Company. 


          4.7
Vacation. The Executive shall be
entitled to [four (4)] weeks of paid vacation during each calendar year, to be
taken during such calendar year at times selected by the Executive, as well as
paid holidays and personal days according to the Company policy in effect from
time to time. 


          4.8
Benefits. During the Term of this
Agreement, Executive shall be eligible to participate in each of the Company’s
existing or future benefit plans, policies or arrangements maintained by the
Company and made available to employees generally, as well as all such existing
or future benefit plans, policies or arrangements maintained by the Company for
the benefit of executives. Except as specifically provided for herein, no
additional compensation under any such plan, policy or arrangement shall be
deemed to modify or otherwise effect the terms of this Agreement. 


5. Termination.


          5.1
Termination by the Company for Cause.
The Company may terminate this Agreement at any time during the Term for Cause,
effective immediately upon written notice to the Executive of such
termination. For purposes of this
Section 5.1, “Cause” shall mean: 


                    (a)
The Executive’s gross incompetence or willful and serious misconduct, that is
injurious to the business, operations or affairs of the Company; 


                    
(b) The Executive’s conviction or plea of nolo
contendere to any felony or a determination by the Company,
following an opportunity by the Executive to appear and be heard by the Board,
that the Executive is engaging in or has engaged in fraud, misappropriation,
dishonesty in financial dealings or embezzlement in connection with the
business, operations or affairs of the Company. 


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A termination
of the Executive’s employment by the Company for any reason not provided for in
this Section 5.1 or in any other circumstances will be a termination “Without
Cause.” 


          5.2
Termination by the Executive for Good Reason.
A resignation for “Good Reason” shall mean a resignation by the
Executive of the Executive’s employment within sixty (60) days of the
occurrence of any of the following events:



                    
(a) Without the Executive’s written consent, a material reduction of his
duties, position or responsibilities;  


                    
(b) Without the Executive’s written consent, a significant reduction by the Company
in the Base Salary or Bonus as in effect immediately prior to such reduction;
or 


                    
(c) Without the Executive’s written consent, a requirement by the Company that
the Executive relocate his office to a location more than fifty (50) miles from
its then-current location. 


          5.3
Voluntary Termination. The
Executive may terminate his employment hereunder, upon not less than 180 days
prior written notice to the Company. 


6. Severance.


          6.1
In the event the Executive’s employment is terminated as a result of a Change
in Control (as defined below), by the Company Without Cause or by the Executive
for Good Reason, the Executive shall be entitled to receive, and the Company
shall be obligated to provide, the following severance benefits: 


                    
(a) Payment to the Executive of an amount equal to the lesser of (i) 2.99 times
the Base Salary in the year of such termination or (ii) the amount of Base
Salary owed to the Executive for the remainder of the Term; 


                    
(b) Payment to the Executive of an amount equal to one hundred percent (100%)
of the greater of (i) the Executive’s Bonus for the year of termination or (ii)
the Bonus actually earned for the year prior to the year of termination, if any;
this amount shall be paid within thirty (30) days of the termination date; 


                    
(c) The same level of health (i.e. medical, vision and dental) coverage and
benefits as in effect for the Executive on the day immediately preceding the
day of termination of employment; provided, however that (i) the Executive
constitutes a qualified beneficiary, as defined in Section 4980B(g)(1) of the
Internal Revenue Code of 1986, as amended; and (ii) the Executive elects
continuation coverage pursuant to the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (“COBRA”), within the time period
prescribed pursuant to COBRA. The Company shall continue to provide the
Executive with such health coverage until the earlier of (A) the date the Executive
is no longer eligible to receive continuation coverage pursuant to COBRA, or
(B) [twelve (12)] months from the termination date; and 


                    
(d) The vesting of the Option will accelerate on the date of termination as to
that number of shares that would have become vested if the Executive had
remained employed by the Company until the date [twelve (12)] months following
the termination date. 


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For purposes
of this Agreement, a “Change in Control” shall mean: (i) the direct or indirect acquisition,
whether in one or a series of transactions by any person (as such term is used
in Section 13(d) and Section 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”)), or related persons (such person or
persons, an “Acquirer”) constituting a group (as such term is used in
Rule 13d-5 under the Exchange Act), of (A) beneficial ownership (as defined in
the Exchange Act) of issued and outstanding shares of stock of the Company, the
result of which acquisition is that such person or such group possesses in
excess of [50]% of the combined voting power of all then-issued and outstanding
capital stock of the Company, or (B) the power to elect, appoint, or cause the
election or appointment of at least a majority of the members of the Board (or
such other governing body in the event the Company or any successor entity is
not a corporation); (ii) a merger or consolidation of the Company with a person
or a direct or indirect subsidiary of such person, provided that the result of
such merger or consolidation, whether in one or a series of related
transactions, is that the holders of the outstanding voting stock of the
Company immediately prior to the consummation of such transaction do not
possess, whether directly or indirectly, immediately after the consummation of
such merger or consolidation, in excess of [50]% of the combined voting power
of all then-issued and outstanding capital stock of the merged or consolidated
person, its direct or indirect parent, or the surviving person of such merger
or consolidation; or (iii) a sale or disposition, whether in one or a series of
transactions, of all or substantially all of the Company’s assets. 


7. Miscellaneous.


          7.1
Notices. All notices under this
Agreement shall be in writing and shall be deemed to have been duly given if
personally delivery against receipt or if mailed by first class registered or
certified mail, return receipt requested, addressed to Company and to the
Executive at their respective addresses set forth in the first paragraph of
this Agreement, or to such other person or address as may be designated by like
notice hereunder. Any such notice shall
be deemed to be given on the day delivered, if personally delivered, or on the
third day after the mailing if mailed. 


          7.2
Parties in Interest. No party
shall assign this Agreement without the prior written consent of the other
party. This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the parties hereto and
their respective heirs, legal representatives, successor and permitted assigns,
but no other person shall acquire or have any rights under or by virtue of this
Agreement. 


          7.3
Further Assurances. From and after
the date of this Agreement, each of the parties hereto shall from time to time,
at the request of the other party and without further consideration, do,
execute and deliver, or cause to be done, executed and delivered, all such
further acts, things and instruments as may be reasonably requested or required
more effectively to evidence and give effect to the transactions provided for
in this Agreement. 


          7.4
Governing Law. This Agreement
shall be governed by and construed in accordance with the laws and decisions of
the State of [________] applicable to contracts made and to be performed
therein without giving effect to the principles of conflict of laws. 


          7.5
Counterparts; Facsimile Signatures.
This Agreement may be executed in counterparts and by facsimile, and each such
counterpart shall be deemed to be an original 


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instrument,
but all such counterparts together shall constitute but one agreement. Facsimile signatures shall be considered
originals for all purposes. 


          7.6
Severability. The provisions of
this Agreement are severable, and if any one or more provisions are determined
to be judicially unenforceable, in whole or in part, the remaining provisions
shall nevertheless be binding and enforceable. 


          7.7
Entire Agreement; Modification; Waiver.
This Agreement contains the entire agreement and understanding between the
parties with respect to the subject matter hereof and supersedes all prior
negotiations and oral understandings, if any.
Neither this Agreement nor any of its provisions may be modified,
amended, waived, discharged or terminated, in whole or in part, except in
writing signed by the party to be charged.
No waiver of any such provision or any breach of or default under this
Agreement shall be deemed or shall constitute a waiver of any other provision,
breach or default. 


[ signature
page follows ]


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          IN WITNESS
WHEREOF, the parties have duly
executed this Agreement as of the date first above written. 


	
 

	
 

	
 


	
 

	
FRIENDFINDER NETWORKS INC.


	
 

	
 


	
 

	
By:

	 

	
 

	
Name:


	
 

	
Title:


	
 

	
 


	
 

	
EXECUTIVE:


	
 

	
 


	
 

	 


	
 

	
DANIEL C. STATON





[Signature Page to Daniel C. Staton
Employment Agreement]