EXHIBIT 10.91
 
AUTOBYTEL INC.
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
 

 
AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) entered into effective
as of April 3, 2009 (“Effective Date”), between Autobytel Inc., a Delaware
corporation (“Autobytel” or “Company”), and Jeffrey H. Coats (“Employee”).
 
Background
 
Autobytel has determined that it is in its best interests to encourage
Employee’s continued employment with, and dedication to the business of,
Autobytel, and the Employee desires to continue Employee’s employment according
to the terms and conditions set forth below.  As a result thereof, Autobytel and
the Employee have agreed that it is in their mutual best interests to enter into
this Agreement, and thereby to amend, restate, and supersede the letter
agreement of employment between the parties dated December 11, 2008 (“Prior
Employment Agreement”).
 
In consideration of the foregoing and other good and valuable consideration,
receipt of which is hereby acknowledged, the Parties hereby agree as follows.
 
1. Definitions.  For purposes of this Agreement, the terms below that begin with
initial capital letters within this Agreement shall have the specially defined
meanings set forth below (unless the context clearly indicates a different
meaning).
 
(a) “409A Suspension Period” shall have the meaning set forth in Section 8.
 
(b) “Arbitration Agreement” means that certain Mutual Agreement to Arbitrate,
attached hereto as Exhibit A dated as of December 12, 2008, by and between
Autobytel and Employee.
 
(c) “Benefits” means all Company medical, dental, vision, life and disability
plans in which Employee participates under Section 4(b).
 
(d) “Board” means the Company’s Board of Directors.
 
(e) “Cause” means the termination of the Employee’s employment by Company as a
result of any one or more of the following:
 
(i) any conviction of, or pleading of nolo contendre by, the Employee for any
felony;
 
(ii) any willful misconduct of the Employee which has a materially injurious
effect on the business or reputation of the Company;
 
(iii) the gross dishonesty of the Employee in any way that adversely affects the
Company; or
 
(iv) a material failure to consistently discharge Employee’s employment duties
to the Company which failure continues for thirty (30) days following written
notice from the Company detailing the area or areas of such failure, other than
such failure resulting from Employee’s Disability.
 
For purposes of this definition of Cause, no act or failure to act, on the part
of the Employee, shall be considered “willful” if it is done, or omitted to be
done, by the Employee in good faith or with reasonable belief that Employee’s
action or omission was in the best interest of the Company.  Employee shall have
the opportunity to cure any such acts or omissions (other than clauses (i)  and
(iii) above) within thirty (30) days of the Employee’s receipt of a written
notice from the Company finding that, in the good faith opinion of the Company,
the Employee is guilty of acts or omissions constituting “Cause.”
 
(f) “Change in Control” shall have the meaning ascribed to such term in the
Company’s Amended and Restated 2004 Restricted Stock and Option Plan as such
definition exists as of the Effective Date.
 
(g) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act, as
amended, and the rules and regulations promulgated thereunder.
 
(h) “Code” means the Internal Revenue Code of 1986, as amended, and the rules
and regulations promulgated thereunder.
 
(i) “Company” means Autobytel, and upon any assignment to and assumption of this
Agreement by any Successor Company, shall mean such Successor Company.
 
(j)           “Consulting Agreement” means the one year consulting agreement
entered into by the Company and Employee concurrently with the execution and
delivery of this Agreement and that will become effective upon the termination
of Employee’s employment by the Company or its Successor Company as contemplated
by Section 5(c) for Employee’s services as an independent contractor at a
payment of forty-nine percent (49%) of the annual Salary in effect immediately
before Employee’s Termination of Employment, which Consulting Agreement is
attached hereto as Exhibit D.
 
(k) “Disability” means the inability of the Employee to perform Employee’s
duties to the Company on account of physical or mental illness or incapacity for
a period of one-hundred twenty (120) consecutive calendar days, or for a period
of one hundred eighty (180) calendar days, whether or not consecutive, during
any three hundred sixty-five (365) day period.
 
(l) “Employee’s Primary Location” means Autobytel’s headquarters located at
18872 MacArthur Boulevard, Suite 200, Irvine, California 92612-1400.
 
(m) “Good Reason” means any act, decision or omission by the Company without the
Employee’s consent that: (A) materially reduces Employee’s Salary (as defined in
Section 4(a) of this Agreement other than a reduction under the limited
circumstance set forth in Section 4(a)) as in existence as of the date hereof or
as of the date prior to any such change, whichever is more beneficial for
Employee at the time of the act, decision, or omission by the Company; (B)
materially diminishes the Employee’s authority, duties, or responsibilities from
an executive-level role; (C) on or within 18 months following a Change in
Control, either relocates the Employee’s place of employment from Employee’s
Primary Location to any other location in excess of a forty (40) mile radius
from the Employee’s Primary Location (and also, after he has relocated to
California, in excess of a forty (40) mile radius from the Employee’s principal
residence), or requires any such relocation as a condition to continued
employment by Company or Successor Company; or (D) involves or results in any
material breach  of this Agreement by the Company or Successor Company, other
than an isolated, insubstantial and inadvertent failure not occurring in bad
faith and which is remedied by the Company promptly after receipt of written
notice thereof given by the Employee.  Notwithstanding the foregoing, no event
shall constitute “Good Reason” unless (i) the Employee first provides written
notice to the Company within ninety (90) days of the event(s) alleged to
constitute Good Reason, with such notice specifying the grounds that are alleged
to constitute Good Reason, and (ii) the Company fails to cure such event(s)
within thirty (30) days after Company’s receipt of such written notice.
 
(n)  “Separation from Service” or “Separates from Service” shall mean Employee’s
termination of employment, as determined in accordance with Treas. Reg. §
1.409A-1(h).  Employee shall be considered to have experienced a termination of
employment when the facts and circumstances indicate that Employee and the
Company reasonably anticipate that either (i) no further services will be
performed for the Company after a certain date, or (ii) that the level of bona
fide services Employee will perform for the Company after such date (whether as
an employee or as an independent contractor) will permanently decrease to no
more than fifty percent (50%) of the average level of bona fide services
performed by Employee (whether as an employee or independent contractor) over
the immediately preceding thirty-six (36) month period (or the full period of
services to the Company if Employee has been providing services to the Company
for less than thirty six (36) months).  If Employee is on military leave, sick
leave, or other bona fide leave of absence, the employment relationship between
Employee and the Company shall be treated as continuing intact, provided that
the period of such leave does not exceed six months, or if longer, so long as
Employee retains a right to reemployment with the Company under an applicable
statute or by contract.  If the period of a military leave, sick leave, or other
bona fide leave of absence exceeds six months and Employee does not retain a
right to reemployment under an applicable statute or by contract, the employment
relationship shall be considered to be terminated for purposes of this Agreement
as of the first day immediately following the end of such six-month period.  In
applying the provisions of this paragraph, a leave of absence shall be
considered a bona fide leave of absence only if there is a reasonable
expectation that Employee will return to perform services for the Company.  For
purposes of determining whether Employee has incurred a Separation from Service,
the Company shall include the Company and any entity that would be considered a
single employer with the Company under Code Section 414(b) or 414(c).
 
(o) “Successor Company” means any successor to Autobytel or substantially all of
its assets by reason of any Change in Control.
 
(p) “Termination Without Cause” means termination of Employee’s employment with
the Company (i) by the Company (a) for any reason other than those reasons
expressly set forth in the definition of “Cause,” or (b) for no reason at all;
or (ii) by Employee for Good Reason within thirty (30) days following the
Company’s failure to cure the event or events that constitute Good Reason;
provided, however, that Employee’s Separation from Service in connection with a
Change in Control shall not constitute a Termination Without Cause if Employee
is offered employment with the Successor Company under terms and conditions,
including position, salary and other compensation, and benefits, that would not
otherwise provide Employee the right to terminate Employee’s employment for Good
Reason under this Agreement.
 
2. Term of Employment. Employee’s employment under this Agreement shall commence
on the Effective Date, and shall end three years later, or such earlier date on
which Employee’s employment terminates in accordance with this Agreement
(“Term”).  The parties may extend the Term only by mutual written agreement
before its expiration date.
 
3. Nature of Duties.  During Employee’s employment under this Agreement,
Employee shall be the Company’s President and Chief Executive Officer.  Employee
shall have all of the customary powers and duties associated with such
positions, and shall be subject to the Company’s policies, procedures, and
approval practices, including without limitation hiring and employment policies,
as in effect from time to time for executives of the Company. Employee shall
devote substantially all of Employee’s full business time and effort to the
performance of Employee’s duties for the Company, which Employee shall perform
faithfully and to the best of Employee’s ability. The Company acknowledges that
Employee may serve as a director of third party companies and that such service
shall not constitute a breach of this Agreement as long as (i) such service does
not interfere with Employee’s performance of Employee’s duties and
responsibilities as the Company’s President and Chief Executive Officer; and
(ii) any such service has been pre-approved by the Board (with Employee’s
service on the boards of directors of Congoleum Corporation and Mikronite
Technologies Group Inc., which predate this Agreement, being pre-approved).
 
4. Compensation, Benefits and Expenses.
 
(a) As compensation for the services to be rendered by Employee pursuant to this
Agreement, the Company hereby agrees to pay Employee a base annual salary
(“Salary”) at a rate equal to (i) Three Hundred Ninety Thousand Dollars
($390,000.00) for the first year of the term of this Agreement; and (ii) Four
Hundred Twenty Thousand Dollars ($420,000.00) during the remainder of the term
of this Agreement. Employee’s Salary shall be reviewed by the Board (or the
Compensation Committee thereof) at least annually and may be increased by an
amount approved by the Board (or the Compensation Committee thereof). The
Company may not reduce Employee’s Salary other than as part of a broad-based
reduction in salaries implemented before a Change in Control, and Employee
agrees that the Company has not made any promises or guaranty of any increase in
Salary during the term.  The Salary shall be paid in substantially equal
bimonthly installments, in accordance with the normal payroll practices of the
Company. While employed by the Company, the Employee will not receive any
compensation for Employee’s service as a member of the Company’s Board or any of
its committees. Upon execution and delivery of this Agreement by Employee, the
Company shall pay Executive the amount of Thirty-Thousand Dollars ($30,000.00)
in consideration for Employee entering into this Agreement (“Signing Bonus”).
 
(b) Employee shall be entitled to all ordinary and customary benefits afforded
generally to executive employees of the Company (except to the extent employee
contribution may be required under the Company’s benefit plans as they may now
or hereafter exist), which shall in no event be less than the benefits generally
afforded to the other executive employees of the Company as of the date hereof
or from time to time, but in any event shall include any qualified or
non-qualified pension, profit sharing and savings plans, any death benefit and
disability benefit plans, life insurance coverages, any medical, dental, health
and welfare plans or insurance coverages, and any stock purchase programs that
are adopted or maintained by the Company generally for executives employees of
the Company.
 
(c) For each calendar year beginning with 2009 and ending before this Agreement
expires, Employee shall be eligible to receive an annual incentive bonus
opportunity targeted at eighty percent (80%) of Employee’s Salary based upon
annual performance goals and the achievement of those goals, as established and
determined at least annually (and consistently with the Company’s most recent
proxy statement disclosure of the standards for providing cash-based incentive
compensation) by the Board or the Compensation Committee of the Board.  Such
performance goals may include Company-wide performance objectives, divisional or
departmental performance objectives, and/or individual performance objectives,
as the Board or the Compensation Committee may determine in its discretion.
 
(d) The Company shall pay or reimburse Employee for all reasonable and
authorized business expenses incurred by Employee while employed under this
Agreement; such payment or reimbursement shall not be unreasonably withheld so
long as said business expenses have been incurred for and promote the business
of the Company and are normally and customarily incurred by employees in
comparable positions at other comparable businesses in the same or similar
market. As a condition to reimbursement under this Section 4(d), Employee shall
furnish to the Company adequate records and other documentary evidence required
by federal and state statutes and regulations for the substantiation of each
expenditure.  Employee must submit proper documentation for each such expense
within 30 days after the date that Employee incurs such expense, and the Company
will reimburse Employee for all eligible expenses within 30 days thereafter, and
in no event later than the last day of the calendar year following the calendar
year in which the expense is incurred.  Employee acknowledges and agrees that
failure to furnish the required documentation may result in the Company denying
all or part of the expense for which reimbursement is sought.
 
(e) Employee shall be entitled to relocation expenses incurred in connection
with Employee’s employment under this Agreement.  Such expenses include (i) a
broker’s sales commission and closing costs (other than points) for either (1)
Employee’s purchase of a new residence in California (or a broker commission for
leasing such a residence) or (2) the sale of Employee’s residence in New Jersey;
(ii) shipping two automobiles from New Jersey to California; and (iii) other
reasonable and customary miscellaneous moving expenses, which other
miscellaneous expenses shall not exceed $30,000.00.  The Company shall reimburse
Employee for temporary housing for up to approximately thirteen months following
the Effective Date until May 31, 2010 (“Temporary Housing Term”), such temporary
housing not to exceed (i) $4,100 per month until July 31, 2009 and (ii) $5,600
per month thereafter until such temporary housing allowance ceases. In the event
Employee leases a residence in California, the Company shall pay the amount of
any reasonable and customary deposits required to be paid by the lessor upon
entering into the lease. If at the end of the Temporary Housing Term Employee
continues to remain in the leased residence, Employee shall reimburse the
Company for the amount of the deposits. The reimbursements to Employee provided
pursuant to this Section 4(e) of this Agreement shall be made in accordance with
the processes, timing, and conditions set forth in Section 4(d) of this
Agreement. Employee shall receive an additional payment to cover all federal,
state or local income taxes Employee incurs as a result of any of the foregoing
relocation costs paid or reimbursed by the Company.
 
(f) As of the Effective Date, Employee shall be granted options to purchase
1,000,000 shares of the Company’s common stock having the terms and conditions
set forth in the form of award agreement attached hereto as Exhibit B.
 
(g) Employee shall be covered by the Company’s directors and officers insurance
policies on the same basis as the Company’s other senior executive officers, as
such insurance policies and coverage limits and conditions may exist from time
to time.
 
5. Severance Benefits and Conditions.  All amounts payable hereunder shall be
subject to reduction for any employment and withholding taxes that the Company
determines are applicable, and shall be subject to any applicable terms and
conditions set forth in this Section 5, and this Agreement generally, including
without limitation Section 8.
 
(a) Termination Other Than Without Cause.  In the event of Employee’s
Termination for Cause, resignation without Good Reason, death, Disability, or
any  reason other than Termination Without Cause, Employee shall be entitled to
receive only (i) any amounts due and owing to Employee as of Employee’s
employment termination date with respect to any Salary, or vested and payable
bonuses or commissions; and (ii) any other payments required by applicable law
(including payments with respect to accrued and unused vacation, personal, sick
and other days).  If Employee’s employment is terminated by reason of the death
or Disability of Employee, in addition to the foregoing payments, Employee or
Employee’s heirs or representatives, as applicable, shall also receive a payment
equal to one-twelfth (1/12) of Employee’s Salary.  If Employee’s Termination for
Cause or resignation without Good Reason occurs within the two-year period
following the Effective Date, then Employee shall repay the Company for any and
all reimbursements that the Company has made to Employee for relocation expenses
pursuant to Section 4(e) of this Agreement, and the Company may reduce or offset
any payments otherwise due hereunder (the “Accrued Amounts”) by such amounts, to
the extent allowed by law.
 
(b) Termination Without Cause.  In the event of Employee’s Termination Without
Cause either before a Change in Control or more than eighteen (18) months after
a Change in Control, Employee shall be entitled to (i) the Accrued Amounts; (ii)
continued Salary for twelve (12) months following the date of Employee’s
Termination Without Cause, at the rate of Salary in effect immediately
beforehand, and (iii) for the same twelve (12) month period, subject to Section
5(d) of this Agreement, Benefits at the levels in effect before employment
terminates, including Company-paid COBRA premiums for any insurance that is in
effect for Employee and/or Employee’s dependents before termination of
Employee’s employment, and that Employee elects to continue in accordance with
COBRA.
 
(c) Termination Without Cause related to Change in Control.    In the event of
Employee’s Termination Without Cause upon or within eighteen (18) months after a
Change in Control, Employee shall be entitled to (i) the Accrued Amounts; (ii) a
lump sum payment equal to one and three-tenths (1.3) of Employee’s annual
Salary, at the rate of Salary in effect immediately beforehand, paid in cash,
(iii) and the Consulting Agreement, which has been executed by the Company and
Employee concurrently with the execution and delivery of this Agreement, shall
become effective, and (iv) for the eighteen (18) month period following
Employee’s Termination Without Cause, subject to Section 5(d) of this Agreement,
Benefits at the levels in effect before employment terminates, including
Company-paid COBRA premiums for any insurance that is in effect for Employee
and/or Employee’s dependents before termination of Employee’s employment, and
that Employee elects to continue in accordance with COBRA.
 
(d) Special Benefits Provisions.  (i)  With respect to Benefits that are
eligible for continuation coverage under COBRA, in the event the Company is
unable to continue Employee’s and Employee’s eligible dependents’ (assuming such
dependents were covered by Autobytel at the time of termination) participation
under the Company’s then existing insurance policies for such Benefits, Employee
may elect to obtain coverage for such Benefits either by (1) electing COBRA
continuation benefits for Employee and Employee’s eligible dependents; (2)
obtaining individual coverage for Employee and Employee’s eligible dependents
(if Employee and Employee’s eligible dependents qualify for individual
coverage); or (3) electing coverage as eligible dependents under another
person’s group coverage (if Employee and Employee’s eligible dependents qualify
for such dependent coverage), or any combination of the foregoing alternatives.
Employee may also initially elect COBRA continuation benefits and later change
to individual coverage or dependent coverage for Employee or any eligible
dependent of Employee, but Employee understands that if continuation of Benefits
under COBRA is not initially selected by Employee or is later terminated by
Employee, Employee will not be able to return to continuation coverage under
COBRA. The Company shall pay directly or reimburse to Employee the monthly
premiums for the benefits or coverage selected by Employee, with such payment or
reimbursement not to exceed the monthly premiums the Company would pay assuming
Employee timely elected continuation of benefits under COBRA.  The Company’s
obligation to pay or reimburse for the Benefits covered by this Section 5(d)
shall terminate upon the earlier of (i) the end of the relevant Company-paid
COBRA premium period designated above within Section 5; and (ii) Employee’s
employment by an employer that provides Employee and Employee’s eligible
dependents with group coverage substantially similar to such Benefits as
provided to Employee and Employee’s eligible dependents at the time of the
termination of Employee’s employment with the Company, provided that Employee
and Employee’s eligible dependents are eligible for participation in such group
coverage.
 
(ii)           With respect to Benefits that are not eligible for continuation
coverage under COBRA, in the event the Company is unable to continue Employee’s
participation under the Company’s then existing insurance policies for such
Benefits, Employee may elect to obtain coverage for such Benefits either by (1)
obtaining individual coverage for Employee (if Employee qualifies for individual
coverage); or (2) electing coverage as an eligible dependent under another
person’s group coverage (if Employee qualifies for such dependent coverage), or
any combination of the foregoing alternatives; provided that any alternative
shall be available and implemented only (I) in a manner that neither accelerates
nor delays the year in which taxable income arises from the Benefits, and (II)
in accordance with Section 409A of the Code. The Company shall pay directly or
reimburse to Employee the monthly premiums for the benefits or coverage selected
by Employee, with such payment or reimbursement not to exceed the monthly
premiums the Company paid for such Benefits at the time of termination of
Employee’s employment with the Company.  The Company’s obligation to pay or
reimburse for the Benefits covered by this Section 5(d)(ii) shall terminate upon
the earlier of (i) the end of the Severance Period; and (ii) Employee’s
employment by an employer that provides Employee with group coverage
substantially similar to such Benefits as provided to Employee at the time of
the termination of Employee’s employment with the Company, provided that
Employee is eligible for participation in such group coverage. Employee
acknowledges and agrees that the Company shall not be obligated to provide any
Benefits covered by this Section 5(d)(ii) for Employee if Employee does not
qualify for coverage under the Company’s existing insurance policies for such
Benefits, for individual coverage, or for dependent coverage.
 
(e) Timing of Payments.  Subject to Section 8 of this Agreement, all payments
under this Section 5 that (i) arise as a result of a termination of Employee’s
employment shall be made to Employee concurrently with any termination by the
Company or within 2 business days of any termination by Employee, except to the
extent contemplated within Section 5(d) above and Section 5(f) below; and (ii)
arise other than by reason of a termination of Employee’s employment shall be
made promptly upon the occurrence of the applicable event giving rise to the
payment (and in no event more than two and one-half months afterward).
 
(f) Conditions on Severance and Benefits. The amounts and benefits (other than
Accrued Amounts) that are payable pursuant to Sections 5(b), 5(c), and 5(d) of
this Agreement shall be provided only if  –
 
(i) Employee is compliant, at all times prior to the due date for any payment,
with the terms and conditions set forth in Section 6; and
 
(ii) Employee has executed and delivered to the Company (and not revoked) a
release in favor of the Company (which release shall be substantially in the
form attached as Exhibit C and shall be delivered to Employee not later than
fifteen days after Employee’s Separation from Service), and that release has
become effective in accordance with its terms both (I) following the expiration
of any applicable revocation period, and (II) not later than two and one-half
months after the end of the calendar year in which Employee’s Separation from
Service occurs. If the Company does not deliver such release to Employee within
fifteen days after Employee’s Separation from Service, the requirement to
execute a release shall be waived.
 
(iii)           If requested by the Company, Employee shall have participated in
an exit interview with the Company’s Board of Directors or a committee thereof.
 
(g) Other than the payments and benefits provided for in this Section 5,
Employee shall not be entitled to any additional amounts from the Company
resulting from a termination of Employee’s employment with the Company.
 
6. Unauthorized Disclosure; Non-Solicitation; Proprietary Rights.
 
(a) Unauthorized Disclosure.  Employee agrees and understands that in Employee’s
position with the Company, Employee will be exposed to and will receive
non-public information relating to the confidential affairs of the Company and
its affiliates, including, without limitation, employee lists and compensation,
technical information, intellectual property, business and marketing plans,
strategies, customer information, software, other information concerning the
products, promotions, development, financing and expansion plans, business
policies and practices of the Company and other non-public forms of information
considered by the Company to be confidential and in the nature of trade secrets
(including, without limitation, ideas, research and development, know-how,
technical data, customer and supplier lists, pricing and cost information and
business and marketing plans and proposals) (collectively, the “Confidential
Information”).  Employee agrees that at all times during Employee’s employment
with the Company, except as may be required for Employee to discharge Employee’s
duties as an officer of the Company, and thereafter, Employee shall not disclose
such Confidential Information, either directly or indirectly, to any Person
without the prior written consent of the Company and shall not use or attempt to
use any such information in any manner other than in connection with Employee’s
employment with the Company, unless (i) required by law or court order to
disclose such information, in which case Employee shall provide the Company with
written notice of such requirement as far in advance of such anticipated
disclosure as possible and use Employee’s best efforts to consult with the Board
prior to such anticipated disclosure; (ii) during the course of or in connection
with any actual or potential litigation, arbitration, or other proceeding based
upon or in connection with the subject matter of this Agreement; (iii) as may be
necessary or appropriate to conduct Employee’s duties hereunder, provided
Employee is acting, in good faith and in the best interest of the Company; (iv)
such information has become public other than by reason of a breach by Employee
of this Section 6(a); or (v) the information is generally known to persons
involved in the Company’s trade or business.  This confidentiality covenant has
no temporal, geographical or territorial restriction.  Upon termination of
Employee’s employment with the Company for any reason, Employee shall promptly
deliver to the Company (or, at the Company’s option, destroy (and provide a
certification of such destruction)) all property, keys, notes, electronic
storage media, memoranda, writings, lists, files, reports, customer lists,
correspondence, tapes, disks, cards, surveys, maps, logs, machines, technical
data and any other tangible product or document which has been produced by,
received by or otherwise submitted to Employee during or prior to Employee’s
employment with the Company, and any copies thereof in Employee’s (or capable of
being reduced to Employee’s ) possession, as well as all computers of the
Company provided to Employee; provided that nothing in this Employment Agreement
or elsewhere shall prevent Employee from retaining and utilizing:  documents
relating to Employee’s personal benefits, entitlements and obligations;
documents relating to Employee’s personal tax obligations; Employee’s desk
calendar and rolodex; and such other records and documents as may reasonably be
approved by the Company.
 
(b) Non-Solicitation of Employees.  During Employee’s employment with the
Company (whether during the term or thereafter) and for a period of twelve (12)
months after Employee’s termination of employment, Employee shall not (other
than in connection with carrying out Employee’s responsibilities for the
Company) directly or indirectly contact, induce or solicit (or assist any person
to contact, induce or solicit) for employment any person who is then or was an
employee of the Company within the six (6) month period prior to the date of
such contact, inducement or solicitation.
 
(c) Interference with Business Relationships.  During Employee’s employment with
the Company (whether during the Term or thereafter) and for a period of twelve
(12) months after Employee’s termination of employment, Employee shall not
(other than in connection with carrying out Employee’s responsibilities for the
Company) directly or indirectly contact, induce or solicit (or assist any person
to contact, induce or solicit) any customer, client, partner, joint venturer,
vendor or supplier of the Company, or any such person who was within six (6)
months of the date of contact a customer, client, partner, joint venturer,
vendor, or supplier of the Company, to terminate its relationship or otherwise
cease doing business in whole or in part with the Company, or directly or
indirectly interfere with (or assist any person to interfere with) any material
relationship between the Company and any of its customers, clients, partners,
joint venturers, vendors or suppliers.
 
(d) No Other Post-Employment Restrictions.  There shall be no contractual or
similar restrictions on Employee’s right to terminate Employee’s employment with
the Company, or on Employee’s post-employment activities, other than as
expressly set forth in this Employment Agreement.
 
(e) Permitted Statements.  Nothing in this Employment Agreement shall restrict
any person from making truthful statements (provided any such statement does not
include Confidential Information) (i) when required by law, subpoena, court
order or the like; (ii) when requested by a governmental, regulatory, or similar
body or entity; or (iii) in confidence to a professional advisor for the purpose
of securing professional advice.
 
(f) Injunctive Relief.  Without limiting the remedies available to the Company,
Employee acknowledges that a breach of any of the covenants contained in this
Section 6 may result in irreparable injury to the Company for which there is no
adequate remedy at law, that it will not be possible to measure damages for such
injuries precisely and that, in the event of such a breach or threat thereof,
the Company shall be entitled to seek a temporary restraining order and/or
preliminary or permanent injunction, without the necessity of proving
irreparable harm or injury as a result of such breach or threatened breach of
this Section 6.
 
7. Representations.  Each party represents and warrants (i) that such party is
not subject to any contract, arrangement, agreement, policy or understanding, or
to any statute, governmental rule or regulation, that in any way limits such
party’s ability to enter into and fully perform such party’s obligations under
this Agreement (including the agreements the forms of which are appended
hereto); (ii) that such party is able without restrictions to enter into and
fully perform such party’s obligations under this Employment Agreement
(including the agreements of which forms are appended hereto); and (iii) that,
upon the execution and delivery of this Employment Agreement by both parties,
this Employment Agreement shall be such party’s valid and binding obligation,
enforceable against such party in accordance with its terms, except to the
extent that enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting the enforcement of creditors’ rights generally.  The
Company represents and warrants that it is fully authorized by action of the
Board, and by actions of any other Person whose authorization is required, to
enter into this Employment Agreement and to perform its obligations under it.
 
8. Taxes.
 
(a) All payments made pursuant to this Agreement will be subject to withholding
of applicable taxes. Notwithstanding the foregoing, and except as otherwise
specifically provided elsewhere in this Agreement, Employee is solely
responsible and liable for the satisfaction of any federal, state, province or
local taxes that may arise with respect to this Agreement (including any taxes
arising under Sections 280G and 409A of the Code).  Neither the Company nor any
of its employees, officers, directors, or service providers shall have any
obligation whatsoever to pay such taxes, to prevent Employee from incurring
them, or to mitigate or protect Employee from any such tax
liabilities.  Notwithstanding anything in this Agreement to the contrary, if any
amounts that become due under this Agreement on account of Employee’s
termination of employment constitute “nonqualified deferred compensation” within
the meaning of Section 409A of the Code, payment of such amounts shall not
commence until Employee incurs a Separation from Service.  If, at the time of
Employee’s Separation from Service under this Agreement, Employee is a
“specified employee” (within the meaning of Section 409A of the Code), any
amounts that constitute “nonqualified deferred compensation” within the meaning
of Section 409A of the Code that become payable to Employee on account of
Employee’s Separation from Service (including any amounts payable pursuant to
the preceding sentence) will not be paid until after the end of the sixth
calendar month beginning after Employee’s Separation from Service (“409A
Suspension Period”).  Within 14 calendar days after the end of the 409A
Suspension Period, Employee shall be paid a lump sum payment in cash equal to
any payments delayed because of the preceding sentence.  Thereafter, Employee
shall receive any remaining benefits as if there had not been an earlier delay.
 
(b)           (i)           For purposes of this Section 8(b), all terms
capitalized but not otherwise defined herein shall have the meanings as set
forth in Section 280G of the Code.  In addition:
 
(A) the term “Parachute Payment” shall mean a payment described in Section
280G(b)(2)(A) or Section 280G(b)(2)(B) of the Code (including, but not limited
to, any stock option rights, stock grants, and other cash and noncash
compensation amounts that are treated as payments under either such section) and
not excluded under Section 280G(b)(4)(A) or Section 280G(b)(6) of the Code;
 
(B) the term “Reasonable Compensation” shall mean reasonable compensation for
prior personal services as defined in Section 280G(b)(4)(B) of the Code and
subject to the requirement that any such reasonable compensation must be
established by clear and convincing evidence; and
 
(C) the portion of the Base Amount and the amount of Reasonable Compensation”
allocable to any Parachute Payment shall be determined in accordance with
Section 280G(b)(3) and (4) of the Code.
 
(ii)           Notwithstanding any other provision of this Agreement, Parachute
Payments to be made to or for the benefit of Employee but for this Section 8(b),
whether pursuant to this Agreement or otherwise, shall be reduced if and to the
extent necessary so that the aggregate Present Value of all such Parachute
Payments shall be at least one dollar ($1.00) less than the greater of (I) three
times Employee’s Base Amount and (II) the aggregate Reasonable Compensation
allocable to such Parachute Payments.  Any reduction in Parachute Payments
caused by reason of this Section 8(b) shall be applied in the manner least
economically detrimental to Employee.  In the event reduction of two or more
types of payments would be economically equivalent, the reduction shall be
applied pro-rata to such types of payments.
 
(iii)           This Section 8(b) shall be interpreted and applied to limit the
amounts otherwise payable to Employee under this Agreement or otherwise only to
the extent required to avoid any material risk of the imposition of excise taxes
on Employee under Section 4999 of the Code or the disallowance of a deduction to
the Company under Section 280G(a) of the Code.  In the making of any such
interpretation and application, Employee shall be presumed to be a disqualified
individual for purposes of applying the limitations set forth in this subsection
(b) without regard to whether or not Employee meets the definition of
disqualified individual set forth in Section 280G(c) of the Code.  In the event
that Employee and the Company are unable to agree as to the application of this
Section 8(b), the Company’s independent auditors shall select independent tax
counsel to determine the amount of such limits.  Such selection of tax counsel
shall be subject to Employee’s consent, provided that Employee shall not
unreasonably withhold Employee’s consent.
 
9. Arbitration and Equitable Relief.  Any controversy or claim arising out of,
or related to, this Agreement, or the breach thereof, shall be governed by the
terms of the Arbitration Agreement.
 
10. Entire Agreement.  All oral or written agreements or representations express
or implied, with respect to the subject matter of this Agreement are set forth
in this Agreement.  This Agreement, and the agreements annexed hereto as
Exhibits A, B, C and D, contain the entire understanding between the parties
hereto and supersedes any prior employment or change-in-control protective
agreement between the Company or any predecessor and Employee, except that this
Agreement shall not affect or operate to reduce any benefit or compensation
inuring to Employee of a kind elsewhere provided, and all of Employee’s prior
confidentiality, non-solicitation, non-interference, work-for-hire, and other
intellectual property obligations to the Company shall remain in full force and
effect, and Employee shall continue to be liable to the Company for any prior
breaches thereof.  No provision of this Agreement shall be interpreted to mean
that Employee is subject to receiving fewer benefits than those available to
Employee without reference to this Agreement. The Parties acknowledge and agree
that this Agreement specifically amends and restates, and supersedes in its
entirety, the Prior Employment Agreement, which shall have no further force or
effect, except as noted above.
 
11. Notices. Except as otherwise provided in this Agreement, any notice,
approval, consent, waiver or other communication required or permitted to be
given or to be served upon any person in connection with this Agreement shall be
in writing.  Such notice shall be personally served, sent by fax or email, or
sent prepaid by either registered or certified mail with return receipt
requested or Federal Express and shall be deemed given (i) if personally served
or by Federal Express, when delivered to the person to whom such notice is
addressed, (ii) if given by fax or email, when sent with answer-back confirmed,
or (iii) if given by mail, two (2) business days following deposit in the United
States mail.  Any notice given by fax or cable shall be confirmed in writing, by
overnight mail or Federal Express within forty-eight (48) hours after being
sent.  Such notices shall be addressed to the party to whom such notice is to be
given at the party’s address set forth below or as such party shall otherwise
direct.
 
If to the Company:
 
Autobytel Inc.
18872 MacArthur Boulevard
Irvine, California 92612-1400
Facsimile:  (949) 862-1323
Attn:  Vice President, Human Resources or comparable title

If to the Employee:
 
To Employee’s latest home address on file with the Company

 
12. No Waiver.  No waiver, by conduct or otherwise, by any party of any term,
provision, or condition of this Agreement, shall be deemed or construed as a
further or continuing waiver of any such term, provision, or condition nor as a
waiver of a similar or dissimilar condition or provision at the same time or at
any prior or subsequent time.
 
13. Amendment to this Agreement.  No modification, waiver, amendment, discharge
or change of this Agreement, shall be valid unless the same is in writing and
signed by the party against whom enforcement of such modification, waiver,
amendment, discharge or change is or may be sought.
 
14. Enforceability; Severability.  If any provision of this Agreement shall be
invalid or unenforceable, in whole or in part, such provision shall be deemed to
be modified or restricted to the extent and in the manner necessary to render
the same valid and enforceable, or shall be deemed exercised from this
Agreement, as the case may require, and this Agreement shall be construed and
enforced to the maximum extent permitted by law as if such provision had been
originally incorporated herein as so modified or restricted, or as if such
provision had not been originally incorporated herein, as the case may be.
 
15. Governing Law.  This Agreement and the relationship of the parties hereto
shall be construed and enforced in accordance with the law of the State of
California without giving effect to such State’s choice of law rules.  This
Agreement is deemed to be entered into entirely in the State of
California.  This Agreement shall not be strictly construed for or against
either party.
 
16. No Third Party Beneficiaries.  Except as otherwise set forth in this
Agreement, nothing contained in this Agreement is intended nor shall be
construed to create rights running to the benefit of third parties.
 
17. Successors of the Company.  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, including any Successor Company.  This
Agreement shall be assignable by the Company in the event of a merger or similar
transaction in which the Company is not the surviving entity, or a sale of all
or substantially all of the Company’s assets.
 
18. Rights Cumulative.  The rights under this Agreement, or by law or equity,
shall be cumulative and may be exercised at any time and from time to time.  No
failure by any party to exercise, and no delay in exercising, any rights shall
be construed or deemed to be a waiver thereof, nor shall any single or partial
exercise by any party preclude any other or future exercise thereof or the
exercise of any other right.
 
19. No Right or Obligation of Employment.  Employee acknowledges and agrees that
nothing in this Agreement shall confer upon Employee any right with respect to
continuation of employment by the Company, nor shall it interfere in any way
with Employee’s right or the Company’s right to terminate Employee’s employment
at any time, with or without Cause.
 
20. Legal and Tax Advice.  Employee acknowledges that: (i) the Company has
encouraged Employee to consult with an attorney and/or tax advisor of Employee’s
choosing (and at Employee’s own cost and expense) in connection with this
Agreement, and (ii) Employee is not relying upon the Company for, and the
Company has not provided, legal or tax advice to Employee in connection with
this Agreement.  It is the responsibility of Employee to seek independent tax
and legal advice with regard to the tax treatment of this Agreement and the
payments and benefits that may be made or provided under this Agreement and any
other related matters. Employee acknowledges that Employee has had a reasonable
opportunity to seek and consider advice from Employee’s counsel and tax
advisors.
 
21. Counterparts.  This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which shall constitute one
instrument.  The parties agree that facsimile copies of signatures shall be
deemed originals for all purposes hereof and that a party may produce such
copies, without the need to produce original signatures, to prove the existence
of this Agreement in any proceeding brought hereunder.
 
22. No Mitigation or Offset. The Company shall not have the right to offset any
amount owed to it against payments due to Employee under this Agreement, except
as expressly provided for in Sections 5(a) and 8 of this Agreement.
 
THE PARTIES ACKNOWLEDGE THAT THE COMPANY HAS ADVISED EMPLOYEE TO OBTAIN
INDEPENDENT LEGAL COUNSEL OF EMPLOYEE’S CHOOSING TO ADVISE EMPLOYEE REGARDING
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT AND ATTACHED EXHIBITS, AND THEIR
TERMS AND CONDITIONS. EMPLOYEE HAS HAD A REASONABLE OPPORTUNITY TO SEEK THAT
ADVICE AND HAS IN FACT OBTAINED SUCH ADVICE FROM INDEPENDENT LEGAL COUNSEL
SELECTED BY EMPLOYEE. EMPLOYEE ACKNOWLEDGES THAT THE TERMS OF THIS AMENDED AND
RESTATED EMPLOYMENT AGREEMENT ARE FAIR AND REASONABLE TO HIM. BY EXECUTING THIS
AMENDED AND RESTATED EMPLOYMENT AGREEMENT, EMPLOYEE IS CONSENTING TO THE TERMS
OF THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT.
 
 
 
 
 

 
 

 
IN WITNESS WHEREOF, the Company and Employee have executed and entered into this
Agreement effective as of the date first shown above. 
 
AUTOBYTEL INC.

By: __/s/ Michael J. Fuchs____________________
                 Michael J. Fuchs
 Chairman of the Board

EMPLOYEE

____/s/ Jeffrey H. Coats______________________
               Jeffrey H. Coats
 
 
 
 
 

EXHIBIT A

MUTUAL AGREEMENT TO ARBITRATE
 
 
 
 
 MUTUAL AGREEMENT TO ARBITRATE
 

1.           Parties:  The parties to this Agreement are Autobytel Inc. and the
individual whose name appears below (“you” or “your”).

2.           Agreement to Arbitrate:  In an effort to resolve any legal disputes
in a quick and fair way, each party, in consideration of the promises made by
the other, agrees that any dispute between them that is within the scope of this
Agreement shall be submitted for resolution through arbitration instead of
through trial by court or jury.  The arbitration shall be before a single
arbitrator in Orange County, California and in accordance with the employment
dispute rules of the American Arbitration Association (“AAA”), then in effect,
except that if those rules conflict with this Agreement, then this Agreement
controls.  The arbitration shall be administered by AAA.

3.           Scope Of Agreement:  This Agreement covers any dispute involving
you and Autobytel that would otherwise be brought in a court of law, including,
without limitation, any claim related to your employment by Autobytel or the
termination of that employment, whether that claim is based on contract, tort,
statute, ordinance, or regulation.  Examples of disputes covered by this
Agreement are claims for breach of contract, breach of covenant of good faith
and fair dealing, wrongful termination in violation of public policy,
retaliatory discharge, discrimination (because of race, sex, national origin,
religion, age, disability, marital status, sexual orientation, or any other
protected status), unlawful harassment, denial of leave, intentional and
negligent infliction of emotional distress, fraud and deceit, negligent
misrepresentation, libel, slander, invasion of privacy, assault, battery, false
imprisonment, conversion, interference with contract or prospective economic
advantage, malicious prosecution, abuse of process, and breach of fiduciary
duty.  Additional non-exhaustive examples include claims to enforce of rights to
employee retirement or welfare benefits and claims for unpaid wages.  This
Agreement also applies to any claim that Autobytel has against you that would
otherwise be brought in a court.

4.           Disputes With Third Parties:  Without limiting the breadth of the
foregoing, this Agreement covers any dispute between you and any other person or
entity affiliated with Autobytel, including benefit plans and the entities that
administer them, and to any dispute in which (a) Autobytel is sought to be held
vicariously or indirectly liable on account of the other person’s conduct or (b)
your adversary is subject to an arbitration agreement with Autobytel and the
dispute relates to your employment by Autobytel or the termination of that
employment.

5.           Claims Not Covered:  This Agreement does not cover (a) any claim
for worker’s compensation benefits, (b) a judicial action by either party for a
temporary restraining order or a preliminary injunction to preserve the status
quo pending arbitration, (c) a charge or complaint with an administrative agency
that alleges employment discrimination or failure to pay wages or other
violations of employment laws or that seeks unemployment compensation, and (d)
any report to a law enforcement agency.

6.           Initiation of Arbitration:  The aggrieved party must notify the
other party by making a written demand for arbitration.  All demands for
arbitration must be provided to the other party within the applicable statute of
limitations. Written notice to Autobytel shall be sent to General Counsel,
Autobytel, Inc.  18872 Mac Arthur Blvd.,  Irvine, CA  92612.  Written notice to
you shall be sent to the last address recorded in your personnel file.  The
demand shall describe the nature of all claims asserted and the facts on which
the claims are based, including (a) a list of witnesses to the events underlying
the dispute, (b) the date the dispute arose, (c) an adequate description (or
copy) of the principal documents that contain any statement supporting the
claims, (d) the relief requested, and (e) the names of all persons against whom
relief is requested.  Notice must be by certified or registered mail, return
receipt requested.  Once the demand is received, Autobytel within ten (10)
business days will file the demand with the appropriate office of the AAA.

7.           Selection Of Arbitrator:  The single arbitrator shall be selected
by the parties as follows.  The AAA shall give each party a list of eleven (11)
arbitrators drawn from its panel of employment arbitrators; provided, however,
that the arbitrators to be drawn from must be former or retired judges or
attorneys at law with at least ten (10) years experience in employment and
financing.  Each party may strike up to six (6) names on the list.  If only one
common name remains on the lists of the parties, that individual shall be
designated as the arbitrator.  If more than one common name remains on the list
of all parties, then the parties shall strike names alternately (the party not
initiating arbitration going first) until only one remains.  If no common name
remains on the lists of all parties, then the AAA shall furnish an additional
list or lists until an arbitrator is selected.  If for any reason the parties
fail to agree on an arbitrator, then the AAA may issue additional lists or, at
its option, make the appointment from among members of its panel of employment
law arbitrators.  By this Agreement neither party waives the right to seek
disqualification of the arbitrator.  If a party seeks disqualification due to a
potential conflict of interest, then the AAA shall make the final decision as to
whether the arbitrator is disqualified.

8.           Expenses and Fees of Arbitration.  If Autobytel initiates the
arbitration, then it shall pay the administrative fees.  If you initiate the
arbitration, then you shall pay an amount equal to the filing fee for initiating
a lawsuit in court, and Autobytel shall pay the remainder of the fees.  Each
side shall pay its own legal fees and expenses.  The fees and expenses of the
arbitrator shall be paid completely by Autobytel, except to the extent that you
decide to pay up to one-half of those fees and expenses yourself.

9.           Authority Of The Arbitrator:  The arbitrator may interpret and
apply this Agreement.  The arbitrator shall decide whether a dispute is
arbitrable, construing the scope of this Agreement broadly in favor of final and
binding arbitration, to the extent permitted by law.  The arbitrator may rule on
pre-hearing disputes and hold conferences by telephone or in person as the
arbitrator deems necessary.  The arbitrator shall resolve all discovery
disputes, and may permit discovery in addition to that provided for in paragraph
11 below, upon a showing that the proposed discovery is needed to adequately
arbitrate a statutory claim.  The arbitrator shall have authority to grant
pre-hearing motions, including motions to dismiss and motions for summary
judgment, in accordance with the rules set forth in the Federal Rules of Civil
Procedure and the judicial authorities interpreting those rules.  Upon notice of
such a dispositive motion, the arbitrator will establish a briefing schedule
and, if necessary, schedule an opportunity for oral argument before considering
the motion.  The arbitrator shall follow the substantive law applicable and may
award any remedy authorized by law, including attorney’s fees that are
authorized by statute.  The arbitrator has no authority to (a) add to or modify
the terms of any contract between the parties, (b) require Autobytel to adopt
new policies or procedures, or (c) decide any matter that was not processed in
accordance with this Agreement, absent written consent of the parties.

10.           Procedures For Arbitration:  The procedures to be followed are
those set forth in the employment dispute resolution rules of the AAA, except to
the extent that those rules contradict this Agreement.  Each party shall have
the right to subpoena witnesses and documents for the arbitration hearing.  No
part of the procedures shall be open to the public or the media.  All evidence
discovered in the prehearing process or submitted at the hearing is confidential
and may not be disclosed, except pursuant to court order.  Unless the parties
otherwise agree, each party may submit a post-hearing brief within thirty (30)
days of the close of the hearing, and the arbitrator shall issue an award within
thirty (30) days after the case is submitted orally or through submission of
post-hearing briefs.  The award shall contain written findings of fact and a
finding on each issue necessary to the arbitrator’s conclusion, together with
conclusions of law sufficient to explain the arbitrator’s decision with respect
to the matters at issue.  A court of competent jurisdiction may enter judgment
upon the award, either by (i) confirming the award, or (ii) vacating, modifying,
or correcting the award (a) on any ground referred to in the U.S. Arbitration
Act, (b) where the findings of fact are not supported by substantial evidence,
or (c) where the conclusions of law are erroneous.  If this provision of the
Agreement providing for review of the arbitration award is adjudged to be void
or otherwise unenforceable, in whole or in part, then the void or otherwise
unenforceable provision shall be deemed to be stricken from this Agreement and
that adjudication shall not affect the validity of the remainder of the
Agreement.

11.           Discovery:  Not less than thirty (30) days before any hearing, the
parties shall exchange copies of those documents they will use as exhibits and a
list of the names of persons they will call as witnesses at the hearing.  Each
party shall be entitled to have the following pre-hearing discovery:  (a) The
right to serve on the other party one set of interrogatories in a form
consistent with Rule 33 of the Federal Rules of Civil Procedure, which shall be
limited to the identification of potential witnesses.  Identification means the
identity of the witness’s name, current address and telephone number, and a
brief description of the subject of testimony.  (b) The right to serve on the
other party one set of document requests in a form consistent with Rule 34 of
the Federal Rules of Civil Procedure, which shall be limited to twenty-five (25)
requests (including subparts, which shall be counted separately).  (c) The right
to conduct up to two (2) seven-hour days of depositions of the witnesses or the
parties in accordance with the procedures set forth in Rule 30 of the Federal
Rules of Civil Procedure, and the right to conduct the deposition of any expert
witness designated by the other party.  (d) The right to subpoena the production
of documents from third parties.  (e) The right to seek a physical or mental
examination consistent with Rule 35 of that Federal Rules of Civil Procedure.

12.           Enforcement Of Agreement:  Your job duties constitute an activity
that affects commerce among the states, making your employment by Autobytel a
transaction involving commerce among the states. This agreement may be enforced
in accordance with the provisions of the Federal Arbitration Act, 9 U.S.C. Sec.
1, et seq., or the provisions of any applicable state arbitration statute.  If
any provision of this Agreement is adjudged to be void or otherwise
unenforceable, in whole or in part, then that adjudication shall not affect the
validity of the remainder of the Agreement.

13.           Not A Contract of Continued Employment:  This Agreement does not
guarantee employment for any definite period, and does not prevent Autobytel
from ending or otherwise modifying your employment with or without cause or
notice at any time.

14.           Modifications:  This Agreement survives the termination of
employment, and may be modified only by a writing signed by you and an officer
of Autobytel.  This Agreement may not be modified by oral or implied agreements,
understandings or arrangements.  No employee or agent of Autobytel is authorized
to make any agreement, understanding or arrangement to the contrary.

15.           Voluntary Agreement:  You acknowledge that you have read this
Agreement and that you understand its terms, that you have had enough time to
consult an attorney before signing this Agreement, that you have taken that
opportunity to the extent you wish to do so, and that you are not relying on any
promises or representations not set forth in this Agreement.  You acknowledge
that this Agreement is the complete agreement between you and Autobytel
concerning the resolution of legal disputes, and that this Agreement supersedes
any prior understandings on the same subject matter.  You understand that by
this Agreement the parties agree to substitute arbitration for court or jury
trial as a means of resolving their legal disputes.

 
Signature
 /s/ Jeffrey H. Coats      

 
 
Name (Print)
 Jeffrey H. Coats  

 
Date
 12/12/08  

Autobytel Inc.

By
 /s/ Lorna Larson  

Lorna Larson
VP, Human Resources

Date
 12/12/08  

 
 
 
 
 

 

 Exhibit B

AUTOBYTEL INC.
200___ STOCK OPTION PLAN
____________________________
 
Stock Option Award Agreement
____________________________

You are hereby awarded this stock option (“Option”) to purchase Shares of
Autobytel Inc. (the “Company”), subject to the terms and conditions set forth in
this Stock Option Award Agreement (the “Award Agreement”) and in the Autobytel
Inc. 200___ Stock and Option Plan (the “Plan”).  You acknowledge that you have
been given a copy of the Plan and a prospectus describing the Plan’s material
terms (with the Plan controlling in the event of any conflicts between
them).  You should carefully review these documents, and consult with your
personal financial advisor, before executing this Award Agreement.  Terms
beginning with capital letters in this Award Agreement have the meaning defined
in this Award Agreement or in the Plan (or if not defined in either of them, as
defined in your Amended and Restated Employment Agreement with the Company dated
effective as of April 3, 2009).

In order for this Option to be effective and enforceable, you must return an
executed original of this Award Agreement to the Company’s General Counsel.  By
executing this Award Agreement, you agree to be bound by all of the Plan’s terms
and conditions as if they had been set out verbatim below.  In addition, you
recognize and agree that all determinations, interpretations, or other actions
respecting the Plan and this Award Agreement will be made by the Administrator,
and will be final, conclusive and binding on all parties, including you, your
heirs, and your representatives.
 
1. Specific Terms.  Your Options have the following terms:
 
Name of Participant:
  Jeffrey H. Coats
Type of Option Award:
Non-Incentive Stock Option.
Number of Shares
Subject to Award:
XXXX
 
 
Option Exercise Price:
$0.35 per Share.
Grant Date:
April 3, 2009.
Vesting:
0% on Grant Date.
 
100% on the earlier of (i) the first anniversary of the Grant Date if your
continuous service has not ended beforehand, (ii) termination of your employment
by the Company Without Cause or by you for Good Reason.
 
The vesting of your Option will not accelerate upon or as a result of a Change
in Control.
 
Expiration Date:
10 years after Grant Date (at 5:00 p.m. Pacific Time on the Expiration Date).

 
2. Manner of Exercise.  This Option will be exercised in the manner set forth in
the Plan, using the exercise form attached hereto as Exhibit A.  The number of
Shares that may be purchased through exercise of this Award is cumulative; that
is, if you fail to exercise the Option for all of the Shares vested hereunder
during any period set forth above, then any remaining Shares that are not
purchased during such period may be purchased through exercise of this Option
during any subsequent period, until the expiration or termination of this Option
pursuant to the terms and conditions of this Award Agreement and of the
Plan.  Fractional Shares may not be purchased.
 
3. Termination of Employment.  Section 6.12 of the Plan will govern the effect
of your termination of employment on this Option, subject to the following
modifications which will control over Plan Section 6.12 to the extent of any
conflict or ambiguity:
 
(a)  
in the event of termination of your employment by the Company Without Cause or
by you for Good Reason, this Option shall vest and become immediately
exercisable and you will have the right to exercise this Option for a period of
two (2) years following the date on which your employment terminates, but in no
event will this Option be exercisable later than the Expiration Date determined
pursuant to Section 1 above;

 
(b)  
in the event your employment terminates due to your resignation without Good
Reason within one (1) year following the Grant Date, your Option will
immediately terminate, and after such one (1) year period will otherwise
terminate at the end of the first day after the date on which you provide notice
of your resignation without Good Reason, but in no event will this Option be
exercisable later than the Expiration Date determined pursuant to Section 1
above;

 
(c)  
in the event your death triggers application of Section 6.12(a) of the Plan, the
six-month extended exercise period to which it refers will be increased to 12
months, but in no event will this Option be exercisable later than the
Expiration Date determined pursuant to Section 1 above;

 
(d)  
in the event of your termination of employment for “Cause” within the meaning of
Section 6.12(c) of the Plan, the provisions of Section 6.12(c) will apply, and
the Company will have the additional right, only within the thirty-day period
after your employment terminates, to repurchase (for a price equal to the
exercise price you paid per Share) any Shares that you have received pursuant to
the exercise of this Option;

 
(e)  
this Option will be canceled and become automatically null and void to the
extent it has not vested on or before your termination of employment for any
reason; and

 
(f)  
the terms of Section 6.12 of the Plan, as modified herein for this Option, shall
survive a Change in Control, and remain in full force and effect with the other
provisions of this Option.

 
4. Restrictions on Transfer of Option. Your rights under this Award Agreement
may not be sold, pledged, or otherwise transferred except pursuant to Section
6.7(a) of the Plan or with the prior written consent of the Committee.
 
5. Designation of Beneficiary.  Notwithstanding anything to the contrary
contained herein or in the Plan, following the execution of this Award
Agreement, you may expressly designate a death beneficiary (the “Beneficiary”)
to your interest if any, in this Option and any underlying Shares.  You may
designate the Beneficiary by completing and executing a designation of
beneficiary agreement substantially in the form attached hereto as Exhibit B
(the “Designation of Death Beneficiary”) and delivering an executed copy of the
Designation of Beneficiary to the Company’s General Counsel.  To the extent you
do not duly designate a beneficiary who survives you, your estate will
automatically be your beneficiary.
 
6. Resale Restrictions on Shares.  During the three-year period following the
Grant Date, you will not have the right to sell or otherwise dispose of any
Shares that you receive through exercise of this Option; provided that the
foregoing resale restriction will lapse in full on the first to occur of your
death, your Total and Permanent Disability, or termination of your employment by
the Company Without Cause or by you for Good Reason.  Otherwise, the resale
restrictions imposed hereunder will lapse only as to one-third (1/3) of the
Total Number of Shares Subject to Award on the first anniversary of the Grant
Date, and as to the remaining two-thirds (2/3) of such Shares in equal
one-twelfth (1/12) installments of the Total Number of Shares Subject to Award
for each calendar quarter that ends after the first anniversary of the Grant
Date, subject to your being in the continuous employment or service of the
Company through the scheduled date for lapse of these resale restrictions. To
the extent a lapse has not occurred, the resale restrictions hereunder will
remain in effect for the full three-year period following the Grant Date. Each
certificate representing any such Shares (or if uncertificated by notation to
the depositary agency) shall be legended to reflect these resale restrictions.
 
7. Taxes.  Except to the extent otherwise specifically provided in your
employment agreement, you acknowledge by signing this Award Agreement that you
will be solely responsible for the satisfaction of any taxes (including taxes
arising under Code Sections 409A regarding deferred compensation, or 4999
regarding golden parachute excise taxes) that may arise pursuant to this Option,
its exercise, or your sale of Shares purchased through this Option, and that
neither the Company nor the Administrator will have any obligation whatsoever to
pay such taxes or to otherwise indemnify or hold you harmless from any or all of
such taxes.  The Committee will have the sole discretion to interpret the
requirements of the Code, including Section 409A, for purposes of the Plan and
this Award Agreement.
 
8. Notices.  Any notice or communication required or permitted by any provision
of this Award Agreement to be given to a party hereunder will be in writing and
will be delivered electronically, personally, or sent by postage prepaid
certified mail, return receipt requested, addressed to such party at the address
on the signature page hereof.  Each party may, from time to time, by notice to
the other party hereto, specify a new address for delivery of notices relating
to this Award Agreement.  Any such notice will be deemed to be given as of the
date such notice is personally or electronically delivered or properly mailed.
 
9. Binding Effect.  Except as otherwise provided in this Award Agreement or in
the Plan, every covenant, term, and provision of this Award Agreement will be
binding upon and inure to the benefit of the parties hereto and their respective
heirs, legatees, legal representatives, successors, transferees, and assigns.
 
10. Modifications.  This Award Agreement may be modified or amended only through
a written agreement between you and the Company, and only in accordance with
Section 8 of the Plan.
 
11. Headings.  Section and other headings contained in this Award Agreement are
for reference purposes only and are not intended to describe, interpret, define
or limit the scope or intent of this Award Agreement or any provision hereof.
 
12. Severability.  Every provision of this Award Agreement and of the Plan is
intended to be severable.  If any term hereof is illegal or invalid for any
reason, such illegality or invalidity will not affect the validity or legality
of the remaining terms of this Award Agreement.
 
13. Counterparts.  This Award Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered will be an
original, but all such counterparts will together constitute one and the same
instrument.
 
14. Plan Governs.  By signing this Award Agreement, you acknowledge that you
have received a copy of the Plan and that your Award Agreement is subject to all
the provisions contained in the Plan, the provisions of which are made a part of
this Award Agreement and your Option is subject to all interpretations,
amendments, rules and regulations which from time to time may be promulgated and
adopted pursuant to the Plan.  In the event of a conflict between the provisions
of this Award Agreement and those of the Plan, the provisions of the Plan will
control.
 
15. Investment Purposes. By executing this Award Agreement, you represent and
warrant that any Shares issued to you pursuant to your Options will be held for
investment purposes only for your own account, and not with a view to, for
resale in connection with, or with an intent in participating directly or
indirectly in, any distribution of such Shares within the meaning of the
Securities Act of 1933, as amended.
 
16. Not a Contract of Employment.  By executing this Award Agreement, you
acknowledge and agree that (i) any person who is terminated before full vesting
of an Award, such as the one granted to you by this Award Agreement, could claim
that he or she was terminated to preclude vesting; (ii) you promise never to
make such a claim; (iii) nothing in this Award Agreement or the Plan confers on
you any right to continue an employment, service or consulting relationship with
the Company, nor will it affect in any way your right or the Company’s right to
terminate your employment, service, or consulting relationship at any time, with
or without Cause; and (iv) the Company would not have granted this Option to you
but for these acknowledgements and agreements.
 
17. Securities Law Restrictions.  Regardless of whether the offering and sale of
Shares through the Plan have been registered under the Securities Act of 1933,
as amended (the “Securities Act”), or have been registered or qualified under
the securities laws of any state, the Company at its discretion may impose
restrictions upon the sale, pledge or other transfer of such Shares (including
the placement of appropriate legends on stock certificates or the imposition of
stop-transfer instructions) if, in the judgment of the Company, such
restrictions are necessary or desirable in order to achieve compliance with the
Securities Act or the securities laws of any state or any other law or to
enforce the intent of this Option.
 
18. Governing Law.  The laws of the State of Delaware will govern the validity
of this Award Agreement, the construction of its terms, and the interpretation
of the rights and duties of the parties hereto, as well as the relationship of
the parties hereto, all without regard to conflict of laws principles thereof.
 
 
 
 
 
BY YOUR SIGNATURE BELOW, along with the signature of the Company’s
representative, you and the Company agree that this Option is awarded under and
governed by the terms and conditions of this Award Agreement and the Plan.
 

AUTOBYTEL INC.
18872 MacArthur Blvd., Suite 200
Irvine, CA  92612

By:           
Glenn E. Fuller
Executive Vice President, Chief Legal and
Administrative Officer and Secretary

PARTICIPANT

The undersigned Participant hereby accepts the terms of this Award Agreement and
the Plan.

Jeffrey H. Coats
 
 
 
 
Exhibit A
 
AUTOBYTEL INC.
200___ Stock and Option Plan
___________________________________________________

Form of Exercise of Employee Stock Option Award Agreement
___________________________________________________
 

 
TO: Autobytel Inc.
 
Attention:  General Counsel
 
Dear Sir or Madam:
 
The undersigned elects to exercise his/her Incentive Stock Options to purchase
_____ shares of Common Stock of Autobytel Inc. (the “Company”) under and
pursuant to a Stock Option Agreement dated as of ______________.
 
1.            Delivered herewith is a certified or bank cashier’s or teller’s
check and/or shares of Common Stock held by the undersigned for at least six
months*, valued at the closing sale price of the stock on the business day prior
to the date of exercise, as follows:
 
$____________  in cash or by certified, bank cashier’s or teller’s check
$____________  in the form of ____ shares of Common Stock,valued at $___________
per share
$                                Total
 
2.            Delivered herewith are irrevocable instructions to a broker
approved by the Company to deliver promptly to the Company the amount of sale or
loan proceeds to pay the exercise price.**
 
If method 1 is chosen, the name or names to be on the stock certificate or
certificates and the address and Social Security Number of such person(s) is as
follows:
 
Name:                                                                                                                                          
 
Address:                                                                                                                                          
 
Social Security
Number                                                                                                                                          
 
Very truly yours,
 
_________________                                                                
Date                                                      Optionee
 
*The Committee may waive the six months’ requirement in its discretion.
**The Committee must approve this method in writing before your election
 
 
 
 
 
Exhibit B
 
AUTOBYTEL INC.
200___ Stock and Option Plan
________________________________

Designation of Death Beneficiary
_________________________________
 
In connection with the Awards designated below that I have received pursuant to
the Autobytel Inc. 200___ Stock and Option Plan (the “Plan”), I hereby designate
the person specified below as the beneficiary upon my death of my interest in
such Awards.  This designation will remain in effect until revoked in writing by
me.
 
Name of Beneficiary:                                           
 
Address:                                
 

 
Social Security No.:                                
 
This beneficiary designation relates to any and all of my rights under the
following Award or Awards:
 
           any Award that I have received or ever receive under the Plan.
 
 

the Stock Option Award that I received pursuant to an award agreement dated
_________ __, ____ between myself and the Company.

 
I understand that this designation operates to entitle the above named
beneficiary, in the event of my death, to any and all of my rights under the
Award(s) designated above from the date this form is delivered to the Company
until such date as this designation is revoked in writing by me, including by
delivery to the Company of a written designation of beneficiary executed by me
on a later date.
 
Date:           
 
By:           
Name of Participant
 
Sworn to before me this
____day of ____________, 200_
__________________________
Notary Public
County of __________________
State of ____________________
 

 
 
 
 
EXHIBIT C

SEPARATION AGREEMENT AND RELEASE

It is hereby agreed by and between you, Jeff H. Coats (for yourself, your spouse
or partner, family, agents and attorneys) (jointly, “You”), and Autobytel Inc.,
its predecessors, successors, affiliates, directors, shareholders, fiduciaries,
insurers, employees and agents (jointly, the “Company”), as follows:

1. You acknowledge that your employment with the Company ended effective
[_______], 20[__], and that you will perform no further duties, functions or
services for the Company subsequent to that date.

2. You acknowledge and agree that you have received all vacation pay and other
compensation due you from the Company as a result of your employment with the
Company and your separation from employment, including, but not limited to, all
amounts required under your Amended and Restated Employment Agreement with the
Company dated as of April 3, 2009 (the “Employment Agreement”), other than those
amounts payable pursuant to Paragraph 3 below and those amounts or benefits, if
any, payable or to be provided after the date hereof pursuant to the Employment
Agreement if required by the terms thereof.  You acknowledge and agree that the
Company owes you no additional wages, commissions, bonuses, vacation pay,
severance pay, expenses, fees, or other compensation or payments of any kind or
nature, other than as provided in this Agreement and those amounts and benefits,
if any, payable or to be provided after the date hereof pursuant to the
Employment Agreement if required by the terms thereof.  All benefits for which
you are eligible pursuant to the Employment Agreement will remain in effect for
the periods set forth therein.

3. In exchange for your promises in this Agreement and the Employment Agreement,
including the release of claims set forth below, if you sign and do not timely
revoke this Agreement pursuant to Paragraph 13 of this Agreement, the Company
will pay you all amounts due to you under the Employment Agreement, minus
legally required state and federal payroll deductions.  The payment provided for
in this paragraph will be made in the time periods required by the Employment
Agreement (except for benefits that will be paid over time as provided therein)
and, if no time is specified, within 5 business days of the date of this
Separation Agreement and Release, and be subject to applicable withholding as
provided in the Employment Agreement.

4. You represent and warrant that you have returned to the Company
any and all documents, software, equipment (including, but not limited to,
computers and computer-related items), and all other materials or other things
in your possession, custody, or control which are the property of the Company,
including, but not limited to, Company identification, keys, and the like,
wherever such items may have been located; as well as all copies (in whatever
form thereof) of all materials relating to your employment, or obtained or
created in the course of your employment with the Company.

5. You hereby represent that, other than those materials you have returned to
the Company pursuant to Paragraph 4 of this Agreement, you have not copied or
caused to be copied, and have not printed-out or caused to be printed-out, any
software, computer disks, or other documents other than those documents
generally available to the public, or retained any other materials originating
with or belonging to the Company.  You further represent that you have not
retained in your possession, custody or control, any software, documents or
other materials in machine or other readable form, which are the property of the
Company, originated with the Company, or were obtained or created in the course
of or relate to your employment with the Company.

6. You shall keep confidential, and shall not hereafter use or disclose to any
person, firm, corporation, governmental agency, or other entity, in whole or in
part, at any time in the future, any trade secret, proprietary information, or
confidential information of the Company, including, but not limited to,
information relating to trade secrets, processes, methods, pricing strategies,
customer lists, marketing plans, product introductions, advertising or
promotional programs, sales, financial results, financial records and reports,
regulatory matters and compliance, and other confidential matters, except as
required by law and as necessary for compliance purposes or except to the extent
the information has become public other than by your breach of this Paragraph
6.  These obligations are in addition to the obligations set forth in
confidentiality or non-disclosure agreements between you and the Company,
including in the Employment Agreement, all of which shall remain binding on you.

7. You agree that you have not and will not at any time reveal to anyone,
including any former, present or future employee of the Company, the fact,
amount, or the terms of this Agreement, except to your immediate family, legal
counsel and financial advisor, or as required by law and as necessary for
compliance purposes.  The Company may disclose the terms of this Agreement and
file this Agreement as an exhibit to its public filings if it is required to due
so under applicable law, as necessary for compliance purposes or to potential
successors or assigns of the Company.

8. You agree that neither you nor anyone acting on your behalf or at your
direction will disparage, denigrate, defame, criticize, impugn or otherwise
damage or assail the reputation or integrity of the Company or any of its
current or former employees or directors to any third party and in particular to
any current or former employee, officer, director, contractor, supplier,
customer, or client of the Company or prospective or actual purchaser of the
equity interests of the Company or its business or assets. The Company agrees
that truthful testimony given in conjunction with legal proceedings will not
violate this Agreement.

9. In consideration for the payments provided for in Paragraph 3, you
unconditionally release and forever discharge the Company, and the Company’s
current, former, and future controlling shareholders, subsidiaries, affiliates,
related companies, predecessor companies, divisions, directors, trustees,
employees, agents, attorneys, successors, and assigns (and the current, former,
and future controlling shareholders, directors, trustees, employees, agents, and
attorneys of such subsidiaries, affiliates, related companies, predecessor
companies, and divisions) (referred to collectively as “Releasees”), from any
and all known and unknown claims, demands, actions, suits, causes of action,
obligations, damages and liabilities of whatever kind or nature and regardless
of whether the knowledge thereof would have materially affected your agreement
to release the Company hereunder that arose at any time before or upon the
signing of this Agreement.  These released claims include without limitation all
of those claims arising under any federal, state, or local employment,
anti-discrimination, or equal employment opportunity law, such as Title VII of
the Civil Rights Act of 1964, 42 U.S.C. section 1981, the Civil Rights Act of
1991, the Age Discrimination in Employment Act of 1967 (“ADEA”), the Americans
with Disabilities Act, the Equal Pay Act, the Family and Medical Leave Act, the
Worker Adjustment and Retraining Notification Act, the California Fair
Employment and Housing Act, and the California Labor Code; and the law of
contract and tort.  The Release will not waive the Employee’s rights to
indemnification under the Company’s certificate of incorporation or by-laws or,
if applicable, any written agreement between the Company and the Employee, or
under applicable law.

With respect to the various rights and claims under the ADEA being waived by you
in this Agreement, you specifically acknowledge that you have read and
understand the provisions of Paragraphs 13, 14, and 15 of this Agreement below
before signing this Agreement. This general release does not cover rights or
claims under the ADEA arising after you sign this Agreement.

You also waive and release and promise never to assert any such claims, even if
you do not believe that you have such claims.  You therefore waive your rights
under section 1542 of the Civil Code of California or any analogous statute of
rule.  Section 1542 states:

A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if know to him or her must have materially affected his settlement with the
debtor.

10. You represent and warrant that you have not filed, and agree that you will
not file, or cause to be filed, any complaint, charge, claim or action involving
any claims you have released in the foregoing paragraph.  This promise not to
sue does not apply to claims for breach of this Agreement.  You agree and
acknowledge that if you break this promise not to sue, then you will be liable
for all consequential damages, including the legal expenses and fees incurred by
the Company or any of the Releasees, in defending such a claim, unless you break
this promise not to sue by suing on a released claim under the ADEA.

11. The Company hereby represents and warrants that concurrently with your
execution and delivery of this Agreement, the Company has paid to you any and
all amounts under the Employment Agreement that are required to be paid to you
by the Company as of the date hereof, excluding, without limitation, any amounts
required to be paid under this Agreement and those amounts or benefits, if any,
payable or to be provided after the date hereof pursuant to the Employment
Agreement if and to the extent required by the terms thereof.

12. Excluded from this Agreement are any claims or rights that cannot be waived
by law, including the right to file a charge of discrimination with an
administrative agency.  You agree, however, to waive your right to any monetary
recovery in connection with such a charge.

13. You are advised to consult with an attorney before you sign this
Agreement.  You understand that you have twenty-one (21) days within which to
decide whether to sign this Agreement, although you may sign this Agreement at
any time within the twenty-one (21) day period.  If you do sign it, you also
understand that you will have an additional 7 days after you sign to change your
mind and revoke the Agreement, in which case a written notice of revocation must
be delivered to Vice President Human Resources or comparable title, Autobytel
Inc., 18872 MacArthur Blvd., Irvine, California 92612-1400, on or before the
seventh (7th) day after your execution of the Agreement.  You understand that
the Agreement will not become effective until after that seven (7) day period
has passed.

14. You acknowledge that you are signing this Agreement knowingly and
voluntarily and intend to be bound legally by its terms.

15. You hereby acknowledge that no promise or inducement has been offered to
you, except as expressly stated above and in the Employment Agreement, and you
are relying upon none.  This Agreement and the Employment Agreement represent
the entire agreement between you and the Company with respect to the subject
matter hereof, and supersede any other written or oral understandings between
the parties pertaining to the subject matter hereof and may only be amended or
modified with the prior written consent of you and the Company.

16. You certify that you have not experienced a job-related illness or injury
for which you have not already filed a claim.

17. If any provision of this Agreement is held to be invalid, the remainder of
the Agreement, nevertheless, shall remain in full force and effect in all other
circumstances.

18. This Agreement does not constitute an admission that the Company or any
other Releasee has violated any law, rule, regulation, contractual right or any
other duty or obligation.

19. This Agreement is made and entered into in the State of California, and it
and the relationship of the parties hereto shall in all respects be interpreted,
enforced, and governed under the law of that state, without reference to
conflict of law provisions thereof.  The language of all parts in this Agreement
shall be construed as a whole, according to fair meaning, and not strictly for
or against any party.

20. Employee acknowledges that: (i) the Company has encouraged Employee to
consult with an attorney and/or tax advisor of Employee’s choosing (and at
Employee’s own cost and expense) in connection with this Agreement, and (ii)
Employee is not relying upon the Company for, and the Company has not provided,
legal or tax advice to Employee in connection with this Agreement.  It is the
responsibility of Employee to seek independent tax and legal advice with regard
to the tax treatment of this Agreement and the payments and benefits that may be
made or provided under this Agreement and any other related matters. Employee
acknowledges that Employee has had a reasonable opportunity to seek and consider
advice from Employee’s counsel and tax advisors.

PLEASE READ CAREFULLY.  THIS AGREEMENT INCLUDES THE RELEASE OF CLAIMS.

Dated:_____________,
20__                                                                ____________________________________
                                                                                                                        
Jeffrey H. Coats

Dated:_____________,
20__                                                                Autobytel
Inc.

                                    By:__________________________________
                                 [Officer’s Name]
                                 [Title]
 
 
 
 
EXHIBIT D

CONSULTING AGREEMENT

 
This CONSULTING AGREEMENT (“Agreement”) is entered into effective as of April 3,
2009 (“Effective Date”) by and between Autobytel Inc., a Delaware corporation
(“Autobytel”), and Jeffrey H. Coats (“Consultant”).
 
Background
 
As of the Effective Date, Consultant is employed by Autobytel as its President
and Chief Executive Officer pursuant to that certain Amended and Restated
Employment Agreement dated as of the Effective Date (“Employment Agreement”).
Capitalized terms used and not otherwise defined herein shall have their
respective meanings as set forth in the Employment Agreement. Subject to the
satisfaction of certain conditions set forth in the Employment Agreement, the
Employment Agreement provides for certain severance and other benefits in the
event of a termination of Consultant’s employment with Autobytel Without Cause
or for Good Reason within eighteen (18) months following a Change in Control.
 
The parties acknowledge that Consultant provides unique services that Autobytel
will continue to need subsequent to the termination of Consultant’s employment
Without Cause or for Good Reason within eighteen (18) months following a Change
in Control. Consultant is willing to consult with Autobytel for a reasonable
transition following the termination of Consultant’s employment under such
circumstances upon the terms and conditions set forth herein. The parties desire
to enter into this Agreement at this time, with the respective obligations of
the parties to come into effect in the event of a termination of Consultant’s
employment with Autobytel Without Cause or for Good Reason within eighteen (18)
months following a Change in Control.
 
NOW, THEREFORE, in consideration of the benefits provided herein and for other
good and value consideration the parties hereto agree as follows.
 
1. Consulting Term.  The term of this Agreement shall be for twelve (12) months,
which shall commence upon and in the event of Consultant’s Termination Without
Cause or for Good Reason within eighteen (18) months following a Change in
Control (“Consulting Term”).
 
2. Consulting Services.  During the Consulting Term, upon request by Autobytel,
Consultant shall provide continuing transition advice and information related to
business issues and projects Consultant was involved in while employed with
Autobytel and any other such related services as reasonably requested by
Autobytel (“Consulting Services”).
 
3. Consulting Time.  During the Consulting Term, Consultant shall be reasonably
available during the Company’s normal business hours and upon reasonable advance
notice to provide Consulting Services at times and places that meet the mutual
convenience of the parties and in a manner that shall not unduly interfere with
Consultant’s other commitments.  Consultant shall not be required to provide
more than twenty (20) hours of Consulting Services per week during the
Consulting Term.  Additional time per week may be agreed upon by the
parties.    Consultant shall not be required to travel to the offices of
Autobytel or otherwise to fulfill his Consulting Services obligations hereunder.
 
4. Compensation.   During the Consulting Term, Consultant shall be paid an
aggregate amount equal to forty-nine percent (49%) of the annual Salary (as
defined in the Employment Agreement) in effect immediately before his
termination of employment.  Consultant shall be paid such amount in twelve equal
monthly installments during the Term no later than the fifteenth (15th) calendar
day of each month. At Consultant’s request, such monthly payments may be made by
check or wire transfer to such address or account, as applicable, as Consultant
shall provide to Autobytel.
 
5. Expenses.  During the Consulting Term, Consultant shall, upon submission of
appropriate supporting documentary evidence in accordance with Autobytel’s
standard procedures, be reimbursed by Autobytel for all expenses necessarily
incurred by Consultant in rendering Consulting Services under this Agreement.
 
6. Termination.  Neither party may terminate this Agreement or modify the
Consulting Term without the prior written consent of the other party.
 
7. Independent Contractor Relationship.  The parties intend that during the
Consulting Term the relationship between them is solely an independent
contractor relationship, and that no employer-employee relationship shall
exist.  The parties expressly acknowledge and agree that during the Consulting
Term Autobytel shall not have the right to control the manner or means by which
Consultant performs the services described in this Agreement, and shall exercise
control only over the end result of the work being performed by the
Consultant.  As an independent contractor, Consultant shall not be eligible for
any fringe benefits provided by Autobytel to its employees (except with respect
to continuation of certain health and welfare benefits furnished to Consultant
as severance benefits under the Employment Agreement). Autobytel shall not
disclose to the Consultant any material, non-public information unless
Consultant agrees to such disclosure in advance and after termination of
Consultant’s employment under the Employment Agreement. Consultant shall no
longer be a Section 16 reporting person under the Securities Exchange Act or
1934, as amended, or be subject to Autobytel’s trading policies
 
8. Consultant’s Obligations.  Consultant agrees that during the Consulting Term
Consultant is responsible for paying all required federal, state and local taxes
relating to Consultant’s business, and that Autobytel has no responsibility for
any such taxes.  In particular, the parties agree and understand that because of
the independent contractor relationship between them, Autobytel will not
withhold any social security or income taxes, make any unemployment or
disability insurance contributions (except with respect to continuation of
certain health and welfare benefits furnished to Consultant as severance
benefits under the Employment Agreement) or obtain workers’ compensation
insurance on behalf of Consultant during the Consulting Term.  Consultant shall
be solely responsible for all such fringe benefits, insurance coverages (except
with respect to continuation of certain health and welfare benefits furnished to
Consultant as severance benefits under the Employment Agreement) and required
taxes in connection with Consultant’s services under this agreement.  Consultant
agrees to indemnify and hold Autobytel harmless against any and all liability
claimed or imposed, including reasonable attorneys’ fees, arising from any act
or failure of Consultant in connection with the performance of the services
described in this Agreement.
 
9. Confidential Information or Materials.  Consultant agrees that at all times
during the Consulting Term, and thereafter, Consultant shall not disclose
Confidential Information, either directly or indirectly, to any Person without
the prior written consent of Autobytel and shall not use or attempt to use any
such information in any manner other than in connection with Consulting
Services, unless (i) required by law or court order to disclose such
information, in which case Consultant shall provide Autobytel with written
notice of such requirement as far in advance of such anticipated disclosure as
possible and use his best efforts to consult with the board of directors of
Autobytel prior to such anticipated disclosure; (ii) during the course of or in
connection with any actual or potential litigation, arbitration, or other
proceeding based upon or in connection with the subject matter of this
Agreement; (iii) as may be necessary or appropriate to conduct Consultant’s
duties hereunder, provided Consultant is acting, in good faith and in the best
interest of the Company; (iv) such information has become public other than by
reason of a breach by Consultant of this Section 9; or (v) the information is
generally known to persons involved in the Company’s trade or business.  This
confidentiality covenant has no temporal, geographical or territorial
restriction.  Upon termination of this Agreement, Consultant shall promptly
supply to Autobytel (or destroy, at Autobytel’s option) all property, keys,
notes, electronic storage media, memoranda, writings, lists, files, reports,
customer lists, correspondence, tapes, disks, cards, surveys, maps, logs,
machines, technical data and any other tangible product or document which has
been produced by, received by or otherwise submitted to Consultant during  the
Consulting Term, and any copies thereof in his (or capable of being reduced to
his) possession, as well as all computers of Autobytel provided to Consultant;
provided, that nothing in this Agreement or elsewhere shall prevent Consultant
from retaining and utilizing: documents relating to his personal benefits,
entitlements and obligations; documents relating to his personal tax
obligations; and such other records and documents as may reasonably be approved
by Autobytel.
 
10. Remedies.  Without limiting the remedies available to Autobytel, Consultant
acknowledges that a breach of any of the covenants contained in Section 9 may
result in irreparable injury to Autobytel for which there is no adequate remedy
at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of such a breach or threat thereof, Autobytel
shall be entitled to seek a temporary restraining order and/or preliminary or
permanent injunction, without the necessity of proving irreparable harm or
injury as a result of such breach or threatened breach of Section 9.
 
11.   Arbitration of Disputes.  Except as provided in Section 10, any
controversy or claim arising out of, or related to, this Agreement, or the
breach thereof, shall be governed by the terms of the Arbitration Agreement.
 
12. No Authority to Bind Autobytel.  During the Consulting Term, Consultant will
not have any authority to commit or bind Autobytel to any contractual or
financial obligations without Autobytel’s prior written consent.
 
13. No Waiver.  No waiver, by conduct or otherwise, by any party of any term,
provision or condition of this Agreement, shall be deemed or construed as a
further or continuing waiver of any such term, provision or condition nor as a
waiver of a similar or dissimilar condition or provision at the same time or at
any prior or subsequent time.
 
14. Amendment to this Agreement.  No modification, waiver, amendment, discharge
or change of this Agreement, shall be valid unless the same is in writing and
signed by the party against whom enforcement of such modification, waiver,
amendment, discharge or change is or may be sought.
 
15. Enforceability; Severability.  If any provision of this Agreement shall be
invalid or unenforceable, in whole or in part, such provision shall be deemed to
be modified or restricted to the extent and in the manner necessary to render
the same valid and enforceable, or shall be deemed exercised from this
Agreement, as the case may require, and this Agreement shall be construed and
enforced to the maximum extent permitted by law as if such provision had been
originally incorporated herein as so modified or restricted, or as if such
provision had not been originally incorporated herein, as the case may be.
 
16. Governing Law.  This Agreement and the relationship of the parties hereto
shall be construed and enforced in accordance with the law of the State of
California without giving effect to such State’s choice of law rules.  This
Agreement is deemed to be entered into entirely in the State of
California.  This Agreement shall not be strictly construed for or against
either party.
 
17. No Third Party Beneficiaries.  Except as otherwise set forth in this
Agreement, nothing contained in this Agreement is intended nor shall be
construed to create rights running to the benefit of third parties.
 
18. Successors of Autobytel.  The rights and obligations of Autobytel under this
Agreement shall inure to the benefit of, and shall be binding upon, the
successors and assigns of Autobytel, including any Successor Company.  This
Agreement shall be assignable by Autobytel in the event of a merger or similar
transaction in which Autobytel is not the surviving entity, or a sale of all or
substantially all of Autobytel’s assets.
 
19. Rights Cumulative.  The rights under this Agreement, or by law or equity,
shall be cumulative and may be exercised at any time and from time to time.  No
failure by any party to exercise, and no delay in exercising, any rights shall
be construed or deemed to be a waiver thereof, nor shall any single or partial
exercise by any party preclude any other or future exercise thereof or the
exercise of any other right.
 
20. Legal and Tax Advice.  Consultant acknowledges that: (i) Autobytel has
encouraged Consultant to consult with an attorney and/or tax advisor of
Consultant’s choosing (and at Consultant’s own cost and expense) in connection
with this Agreement, and (ii) Consultant is not relying upon Autobytel for, and
Autobytel has not provided, legal or tax advice to Consultant in connection with
this Agreement.  It is the responsibility of Consultant to seek independent tax
and legal advice with regard to the tax treatment of this Agreement and the
payments and benefits that may be made or provided under this Agreement and any
other related matters. Consultant acknowledges that Consultant has had a
reasonable opportunity to seek and consider advice from Consultant’s counsel and
tax advisors.
 
21. Counterparts.  This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which shall constitute one
instrument.  The parties agree that facsimile copies of signatures shall be
deemed originals for all purposes hereof and that a party may produce such
copies, without the need to produce original signatures, to prove the existence
of this Agreement in any proceeding brought hereunder.
 
22. No Mitigation or Offset. The Company shall not have the right to offset any
amount owed to it against payments due to Consultant under this Agreement.
 
[Remainder of Page Intentionally Left Blank; Signature Page Follows]
 
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

 
Autobytel Inc.
By:    /s/ Michael J. Fuchs          
           Michael J. Fuchs
           Chairman of the Board
 
 
Consultant
/s/ Jeffrey H. Coats           
    Jeffrey H. Coats