Document:

Exhibit 10.31

Exhibit 10.31

FRIENDFINDER NETWORKS INC.

6800 BROKEN SOUND PARKWAY

SUITE 200

BOCA RATON FL 33487

July 8, 2008

Ezra Shashoua 

3990 NW 52nd Place

Boca Raton, FL  33496

Re:

Restated Employment Offer For Position Of Chief Financial Officer 

Dear Ezra:

On behalf of Friendfinder Network Inc., (the “Company”), I am pleased to restate to you the conditions of your employment in  the position of Chief Financial Officer, reporting directly to Marc Bell and Daniel C. Staton.  This letter agreement supercedes the letter agreement dated September 6, 2007, which is of no further force.  This position is based in the Company’s Boca Raton, Florida offices (currently located at 6800 Broken Sound Parkway, Suite 100, Boca Raton, Florida 33487).

1.

Base salary:  Effective July 1, 2008, your base annual salary will be payable semi-monthly in accordance with the Company’s standard payroll practices at the rate of  $16,667 ($400,000 annually).

2.

Other Compensation:  Contingent upon your continued employment through and at the end of the IPO (Initial Public Offering) process,  and based on the achievement of specific goals and objectives set forth and agreed to with and by Senior Management, you will be eligible for an annual performance based bonus of up to fifty percent (50%) of your then current annual salary with PMGI.

3.

SPAC Compensation:  Contingent upon your continued employment through and at a conclusion of the Special Purchase Acquisition Company (SPAC) acquisition taking place, you will receive an additional annual base salary of $200,000 payable in accordance with the Company’s standard payroll practices.  Based on the achievement of specific goals and objectives set forth and agreed to with and by Senior Management, you will be eligible for an annual performance based bonus of up to fifty percent (50%) of your then current annual salary with SPAC.

4.

Start date:  Your start date of employment was January 1, 2008.

5.

Equity compensation (Friendfinder):  It is contemplated that the Company will be issuing options imminently and restricted stock upon the consummation of an IPO.  You will receive options from time to time in an amount and other terms equal to those received by the top tier of senior executives pursuant to the Company’s Stock Option Plan.  The amount of options to be issued to you initially is currently planned to be 1,000,000  In addition, upon the consummation of an IPO, restricted stock will be issued to you from time to time in an amount and other terms equal to those received by the then top tier of senior executives of the Company receiving such stock.

6.

Equity compensation (SPAC):  At the time of the SPAC acquisition closing, you will be eligible to receive stock options commensurate with those allocated to the employees within the top five (5). 

7.

Benefits and vacation time:  Beginning the first day of the month following your full-time employment start date, you will be eligible for the standard Company health insurance, dental insurance, disability insurance, life insurance, and other benefit plans, consistent with the terms of such plans and as set forth in the summary plan documents, a copy of which the Company will provide to you.  Beginning the first day of the month following ninety days after your full-time employment start date, you will be eligible for the standard 401(K) savings plan.  Vacation shall be as agreed to between the parties but in no event less than 4 weeks.

8.

Responsibilities:  You will be responsible for the Chief Financial Officer function.  You will also be responsible for functions and such other duties as may be reasonably assigned by the Company from time to time and consistent with or complementary to your duties as described herein.  You will devote all of your professional time, attention, energy and skill to the business and affairs of the Company. You will serve the Company faithfully and diligently to the best of your ability.  We acknowledge your prior commitment and understand that you may need to devote some time to completing that project.(to Incubrands Spirits Group llc.)

9.

At-will employment:  The Company is an “at will” employer and you are an “at will” employee.  As such, your employment is not for any definite period of time, and either you or the Company may terminate such employment for any reason, at any time, with or without cause, and with or without notice.  Similarly, as an employee of the Company, you will be subject to such employment policies and terms and conditions as the Company may adopt or modify from time to time, and nothing in this offer letter, or told or given to you during your employment should be interpreted as a guarantee or contract for continued employment.

10.

Termination without Cause:  If you are terminated without Cause, as the Company may elect to do, , or in the event an IPO does not take place within one year of the Friend Finder acquisition, or if a change of control takes place within on year of the Friend Finder acquisition, or should the base  of the Chief Financial Officer relocate from Boca Raton, Florida, you will have the option of exercising your right to resign your position and the Company shall pay you the lump sum of $400,000 within 30 days of such resignation. (the “Severance Payment”).  “Cause” shall be a willful failure or refusal on your part to perform your duties under this Agreement; willful failure or refusal to carry out the lawful directions of your superiors provided that you shall not be liable for willfully failing or refusing to perform your duties under this agreement for any actions undertaken or not undertaken as the result of following the lawful directions of your superiors; willful gross misconduct on your part, including but not limited to theft, violent work-related behavior, violation of the Company’s sexual or other unlawful workplace harassment policies or repeated acts of gross insubordination; willful dishonesty or fraud in connection with your employment, regardless of whether it results in economic harm to the Company or its subsidiaries or affiliates; indictment or conviction of a crime other than a minor traffic infraction; or material breach of one or more provisions of this Agreement.  If you are terminated with Cause, , you shall receive only unpaid salary through the date your employment is terminated and shall forfeit all entitlement to [as yet unvested] stock options and unpaid bonus.

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11.

D&O insurance coverage:  The Company shall cover you in its standard D&O  insurance policy, under the current limits and evidence in place.  To the fullest extent permitted by law, the Company shall indemnify, defend, protect and hold you harmless from and against all claims, demands, causes of action, actions, suits, costs, damages, penalties, fines, liabilities, losses and expenses, whether civil or criminal, including without limitation reasonable  and reasonably documented attorneys’ fees and consultants’ fees and expenses arising out of or resulting from the performance of your duties within the scope of your employment, provided that (i) all such obligations shall first be satisfied on behalf of the Company via its insurance coverages consistent with the terms of such coverages; (ii) you provide immediate notice to Marc Bell, Daniel C.  Staton and the Company’s General Counsel of any matters that you believe could trigger the Company’s obligations pursuant to this Section; and (iii) as between you and the Company, the Company shall have sole control over the defense, strategy and resolution of such matters, and you will cooperate as requested by the Company and its representatives in connection with the defense and resolution of all such matters, provided that as to this provision (iii) you have the right to decline representation provided by the Company and engage, on your own behalf and at your own (i.e., non-indemnified) expense, independent counsel chosen by you and approved by the Company should any civil or criminal proceedings be asserted against you personally.

12.

Intellectual property and confidentiality.

a.

Intellectual property.  All inventions, trade secrets, works of authorship and other intellectual property created by you in part or in whole during your employment with Company using Company resources, or otherwise related to the actual or prospective businesses or interests of the Company, shall be owned exclusively by the Company and shall be deemed “work made for hire” to the extent permissible under applicable law.  You agree to execute and deliver promptly, at the Company’s expense, all assignments and other documents requested by the Company to confirm the Company’s ownership of such in such intellectual property.  You hereby waive any and all moral rights you might have in such intellectual property.  You agree that any inventions, products, processes, apparatus, designs, improvements, or business related suggestions and information, conceived, discovered, made or developed by you, solely or jointly with others, after your termination of employment with the Company that are based on the Company’s trade secrets or confidential information shall belong to the Company and you hereby assign any and all rights in such items to the Company.

b.

You agree you will fully and promptly disclose, in writing, to the Company all inventions, products, processes, apparatus, designs, improvements, or business related suggestions and information which you may, solely or jointly with others, conceive, discover, make or develop while employed with the Company.

13.

Confidentiality.  

As a result of your employment with the Company, you agree you will have access to “confidential information” about the Company and its business, subsidiaries, and affiliates.  You agree that you will not at any time utilize for personal benefit, or directly or indirectly divulge or communicate to any person, firm, corporation or entity, any confidential information concerning the Company and its business, subsidiaries and affiliates, which was disclosed to or acquired by you at any time during the Term of this Agreement, except upon direct written authority of Marc Bell, Daniel C. Staton or the Chief Executive Officer.  You specifically agree that all confidential information or knowledge concerning matters affecting or relating to the Company’s business obtained by you during your employment is deemed to be included within the terms of this paragraph and to constitute important, material and confidential trade secrets that affect the successful conduct of the Company’s business and its goodwill.

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“Confidential information,” as used herein, means information which includes, but is not limited to, the names, buying habits or practices of any of the Company’s customers; operational, marketing and fundraising strategies; marketing methods and related data; the names of any vendors or suppliers; costs of materials; the prices the Company obtains or has obtained or at which it sells or has sold its products or services; manufacturing and sales costs; lists or other written records used in the Company’s business; compensation paid to employees and other terms of employment; merchandising or sales techniques; contracts and licenses; business systems; computer software and programs (including object code and source code), network architecture, protocols, and any other confidential information of, about, or concerning the business of the Company and its parents, subsidiaries and affiliates, their manners of operation, or other confidential data of any kind.

Enclosed you will find two copies of our Offer of Employment.  Please contact me as soon as you have reached a decision concerning our offer of employment.  Indicate your acceptance of this offer by signing and dating below and returning this signed offer letter to Carmela Monti, Vice President, Human Resources via fax 212-702-6283.  You may keep one copy for your records.

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We are very excited about the contributions you can make to the Friendfinder Team!  Should you have any questions concerning the enclosed information or need additional information, please contact me at (561) 988-1724.

		
	/s/  Daniel C. Staton

	7/8/08

	Daniel C. Staton

	Date

	Chairman

	 

ACKNOWLEDGED AND AGREED

		
	/s/  Ezra Shashoua

	7/8/08

	Ezra Shashoua

	Date

5Exhibit 10.32

Exhibit 10.32

October 25, 2007

Mr. Robert Brackett

367 Santana Heights

Apt. #3084

San Jose, CA  95128

Re:

Employment Offer Letter

Dear Rob:

On behalf of Penthouse Media Group Inc. (“PMGI”), I am pleased to offer you the position of President with Various, Inc. (the “Company”), reporting directly to the CEO of PMGI or his designee, and based in the Company’s Northern California offices (currently located at 445 Sherman Avenue, Suite C, Palo Alto, CA 94306).

1.

Base salary.  Your base salary for 2007 will be payable bi-weekly at the rate of $12,115.38 ($315,000 annually).  It is anticipated that this salary will be reviewed in January 2008.

2.

Bonus.  Your bonus will be payable as outlined in Exhibit A, less applicable withholding.

3.

Equity compensation.  The Company currently intends to implement an employee stock option plan, restricted stock or other equity incentive plan.  If and when the Company implements such a plan, you may participate in the manner appropriate to your employment level consistent with the plan’s terms, which may be set according to the Company’s sole discretion and will govern all details of your participation.

4.

Benefits and vacation time.  Beginning the first day of employment with the Company, you will continue to be eligible for your current health insurance, dental insurance, disability insurance, life insurance, 401(k) savings and other benefit plans, consistent with the terms of such plans and as set forth in the summary plan documents, or at the option of the Company, for analogous plans sponsored by the Company which shall include benefits no less favorable than those in which you currently participate.  Such plans will not be impacted for consideration of any prior existing condition.  The Paid Time Off (PTO) system, which provides eligible employees with a “bank” of paid hours, to be used as you deem appropriate, will continue.  You will continue to accrue paid time off hours at your rate currently in effect.  In your capacity as a Company employee, you will be covered by its “directors & officers” insurance policy pursuant to its terms, as amended from time to time.  You will be reimbursed for your reasonable out-of-pocket Company-related expenses (including legal costs, if any) consistent with the Company’s Employee Manual or other stated reimbursement policies and procedures.

5.

Start date.  Your start date shall be the date of closing of the Various, Inc. acquisition by PMGI, and this agreement will be binding on PMGI as of such event.  Your current tenure with Various, Inc. will be grandfathered with regard to all welfare and benefit programs.

6.

Responsibilities.  You will be responsible for the President function.  You will also be responsible for functions and such other duties as may be reasonably assigned by the Company from time to time and consistent with or complementary to your duties as described herein.  You will devote all of your professional time, attention, energy and skill to the business and affairs of the Company.  You will serve the Company faithfully and diligently to the best of your ability.

7.

Term.  Your term of employment shall commence on the Start Date and continue for three (3) years; provided that the Company may terminate you for Cause without incurring further liability to you in connection with your employment.  “Cause” means (i) a willful failure or refusal on your part to substantially perform your duties under this agreement, the Employee Proprietary Information Agreement, or otherwise imparted by the Company’s Employee Manual or other stated policies and procedures; (ii) willful failure or refusal to carry out the lawful directions of your superiors; (iii) willful gross misconduct on your part, including but not limited to theft, violent work-related behavior, violation of the Company’s anti-discrimination and anti-harassment policies or repeated acts of gross insubordination; willful dishonesty or fraud in connection with your employment, regardless of whether it results in economic harm to the Company or its subsidiaries or affiliates; indictment or conviction of a crime other than a minor traffic infraction.  Cause will only exist under items (i) and (ii) above if such failures continue following a reasonable period after a written demand for substantial performance is delivered to you by the Company, which demand specifically identifies the manner in which the Company believes mat you have not substantially performed your duties.  For purposes of this agreement, no act or failure to act on your part shall be deemed “willful” unless done or omitted to be done by you not in good faith, or without belief that your actions were in the best interests of the Company.  If you are terminated with Cause, you shall receive only unpaid salary through the date your employment is terminated.  Termination for other than cause or resignation by the employee for Good Reason will result in the company continuing to pay the employee his base salary from the date of termination to a date which is three years from the date of the employee’s Start date; provided that, except as prohibited by state of federal law, you execute and return to the Company a valid and binding release of all other claims, in a form reasonably satisfactory to the Company, related to or arising out of your employment before such pay continuation commences.  Good Reason shall mean:

a.

any reduction of your base salary;

b.

the relocation of your base office that is more than fifty (50) miles from the location of your base office as of your start date; or

c.

the failure of the Company to obtain from any Company successor its agreement to assume and perform the terms of this agreement.

8.

Contingent offer.  This offer is valid until November 12, 2007 and is contingent upon your compliance with the 1986 Immigration Reform and Control Act.  The enclosed Employment Eligibility Certification describes acceptable documentation.  Please bring verification of your identity and eligibility for employment with you on your first day.  This offer of employment is also contingent upon your execution of the Company’s Employee Proprietary Information Agreement.

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9.

Interference with Business.  You acknowledge that because of your responsibilities at the Company, you have developed and will help to develop, and have been and will be exposed to, the Company’s business strategies, information on customers and clients, and other valuable Proprietary Information (as defined in the Employee Proprietary Information Agreement) and trade secrets, and that use or disclosure of such Proprietary Information and trade secrets in breach of this agreement would be extremely difficult to detect or prove.  You also acknowledge that the Company’s relationships with its employees, customers, clients, vendors, and other persons are valuable business assets.  Therefore, you agree as follows:

a.

You shall not, for a period of one (l) year following termination of your employment with the Company for any reason, directly or indirectly solicit, induce, recruit, or encourage any officer, director, or employee of the Company to leave the Company or terminate his or her employment with the Company.

b.

You shall not, for a period of one (1) year following the termination of your employment with the Company for any reason, for the purpose of selling products or services competitive with the Company’s, solicit any actual or prospective customer or client of the Company by using the Company’s Proprietary Information or trade secrets, or otherwise solicit such customers or clients by using means that amount to unfair competition.

c.

You shall not, following the termination of your employment with the Company for any reason, use the Company’s Proprietary Information or trade secrets to interfere with any business relationship or contract between the Company and any of its customers, clients, vendors, business partners, or suppliers.

This agreement shall be governed by the laws of the State of California.  Any disputes arising from this agreement shall be brought solely in the state or federal courts located in Palo Alto, California.

Enclosed you will find two copies of this offer of employment.  Please contact me as soon as you have reached a decision concerning our offer of employment.  Indicate your acceptance of this offer by signing and dating below and returning this signed offer letter to Ms. Carmela Monti via fax at (212) 702-6283.  You may keep one copy for your records.

We are very excited about the contributions you can make to the Penthouse Media Group team! Should you have any questions concerning the enclosed information or need additional information, please contact Ms. Carmela Monti at (212) 702-6209.

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Sincerely,

PENTHOUSE MEDIA GROUP INC.

		
	/s/  Daniel C. Staton

	10/25/07

	Name:     Daniel C. Staton

	Date:

	Title:       Chairman

	 

ACKNOWLEDGED AND AGREED

		
	/s/  Robert Brackett

	11/9/07

	Robert Brackett

	Date:

Enclosure (Employment Eligibility Certification)

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EXHIBIT A:  BONUS PLAN

This bonus plan commenced on your start date and ends on December 31, 2007.  This plan in no way guarantees you any future bonuses outside of the agreed upon plan and time frame.

1.

Bonus Agreement:  You will be awarded a bonus on a quarterly basis.  The amount will take two factors into consideration.  One is top-line revenue for the current quarter versus the average top-line revenue of the previews two quarters.  The second is bottom-line profit for the current quarter versus the average bottom-line profit of the previous two quarters.  These two growth rates will be calculated (subtracting 1 from the result so zero growth equals zero in the formula), and your bonus will be equal to “A” plus “B” times top-line growth plus “C” times bottom-line growth.  The bonus will not be less than zero.  In the event that the Company acquires (or divests) itself of any revenue or profit source, e.g., acquires a business, sells a division of the Company, etc., the new source’s revenue and profit will be included (or excluded) in the formula for calculating the bonus.

2.

Due Date:  You will receive your quarterly bonus within 10 days of the  last day of the quarter.  The company can prolong the due date an additional 10 days if it is unable to accurately account for that quarter’s profit and/or revenue within the 10 days of quarter end.

3.

Eligibility:  Your employment status is still an “at-will” employment contract.  In order to  be eligible for your quarterly bonus, you will need to be employed on the last day of the quarter to be deemed eligible for that quarterly payout.  Once you are no longer an employee of the Company, this bonus plan is void and is not payable on a prorated basis.

4.

Withholding Taxes:  All bonuses referred to in this letter are subject to reduction of gross earnings to reflect applicable withholding and payroll taxes.

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