**Exhibit 10.45**

 

**EMPLOYMENT AGREEMENT**

 

ThisEmployment Agreement (the “Agreement”) is entered into as of April 1,2010, 2010 (the “Effective Date”) by and between Robert Werner, anindividual (“Employee”), and MxEnergy Inc., a Delaware corporation (the “Company”).  Employee and the Company are referred toindividually herein as a “Party” and collectively as the “Parties.”  Terms within this Agreement that begin withinitial capital letters shall have the meaning specially set forth herein,unless the context clearly demonstrates a different meaning.

 

1.     Employment.  Employee shall serve as Vice President,Supply, of the Company, will report to the Chief Executive Officer (“CEO”) orwhomever the CEO designates in the event of a reorganization (but in no event anyoneother than the CEO or someone serving as the Company’s Chief Operating Officeror as an executive vice president), and will render such services consistentwith the foregoing role.  Employee’soffice shall be located at the Company’s principal Houston, Texas location (the“Houston Office”).

 

2.     Term.  Unless earlier terminated in accordance withthis Section 2, the Company’s employment of Employee pursuant tothis Agreement shall commence on the Effective Date and end on the thirdanniversary of the Effective Date (the “Initial Term”); *provided, however,*that this Agreement shall remain ineffect thereafter for consecutive one-year periods (each a “Renewal Term”)provided that neither Party has provided written notice to the other Party, atleast sixty (60) days prior to the expiration of the Initial Term or thethen-current Renewal Term, that this Agreement shall terminate at the end ofsuch Initial Term or Renewal Term, as applicable.  Notwithstanding the foregoing, (a) theCompany may terminate this Agreement (i) on the account of Employee’sdeath; (ii) for Business Reasons (as defined below); or (iii) withoutBusiness Reasons, upon sixty (60) days’ written notice; and (b) Employeemay terminate this Agreement (i) as the result of a Constructive Termination(as defined below); or (ii) upon sixty (60) days’ written notice for anyreason other than a Constructive Termination. The term “Termination Date,” as used in this Agreement shall mean(A) if this Agreement is terminated on account of Employee’s death, thedate of death; (B) if this Agreement is terminated by the Company, thedate on which such termination occurs as set forth in a notice of terminationgiven to Employee by the Company in accordance with Section 11(b); or (C) ifthe Agreement is terminated by Employee, the date indicated in a notice oftermination given to the Company by Employee in accordance with Section 11(b).  The period between the Effective Date and theTermination Date is the Employment Term.

 

3.     BaseSalary; Signing Payment.  The Companyshall pay Employee base salary (“Base Salary”) at an annual rate of$300,000.  Employee’s Base Salary shallbe paid in conformity with the Company’s salary payment practices generallyapplicable to the Company’s similarly situated executive employees.  In addition, within ten (10) days of theEffective Date, the Company shall pay Employee a lump sum of $31,253, whichsuch amount equals the difference between the amount of base salary thatEmployee earned between August 13, 2009 and the Effective Date and theamount of base salary that Employee would have earned during that time had hisannualized base salary been $300,000.

 

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4.     Bonus.  The Company shall pay Employee an annualbonus (the “Annual Bonus”) based on Employee’s and the Company’s performancefor each complete and partial fiscal year in which this Agreement is in effect,which such bonus shall be determined and paid annually in a manner consistentwith the determination and payment of bonuses paid to other executives of theCompany.  For purposes of determiningEmployee’s Annual Bonus, the target shall be 100% of Employee’s Base Salary(the “Target Bonus”) for performance that the Board determines, in itssole discretion, to be satisfactory.  Ifperformance goals are exceeded, the Annual Bonus may exceed the Target Bonus; *provided however* that in no event shall the Annual Bonusexceed 150% of Employee’s Base Salary. The Annual Bonus shall be paid annually in a manner consistent with thepayment of bonuses paid to other executives of the Company; *provided, however*, such bonus shall not be paid later thantwo and one-half (2 1⁄2) months following the end of the year to which theperformance objectives relate.

 

5.  Employee Benefits.

 

(a)   Stock Options and Other Stock Awards.  During the Employment Term, the Employeeshall be entitled to participate, on the same basis as other similarly situatedemployees of the Company, in any future stock option plans and any other equitybased incentive plans as may be approved by the compensation committee of theBoard of Directors from time to time.** **Nothing in this Section 5(a) shallpreclude Employee from continuing to participate in stock option plans andother equity based incentive plans in which he participates as of the EffectiveDate.

 

(b)   Other Employee Benefits. During the Employment Term, the Employee shall be entitled to receiveall benefits provided to executive employees of the Company generally from timeto time, including health, life insurance and disability, and all otherretirement (including without limitation 401(k)), welfare, and fringe benefitsprovided to the Company’s executive employees generally, in each case so longas, and to the extent, the same exist; provided, that in respect to each suchplan Employee is otherwise eligible and insurable in accordance with the termsof such plans.

 

(c)   Vacation, Sick Leave, Holidays and Sabbatical.  Employee shall be entitled to paid time off (“PTO”),sick leave, and holidays in accordance with the policies of the Company as theyexist from time to time, and as provided to executive-level employees.  PTO not used during any calendar year willnot roll over to the following year.

 

6.             TerminationPay.

 

(a)             Resignation, Death, orTermination for Business Reasons.  If(i) Employee voluntarily terminates his employment, other than as a resultof a Constructive Termination (as defined below), or (ii) the Companyterminates Employee’s employment for Business Reasons (as defined below), thenin any such event (A) Employee will be paid all accrued but unpaid PTO,expense reimbursements and other benefits due to Employee through theTermination Date under any Company-provided or paid plans, policies andarrangements, (B) Employee will be paid all accrued and unpaid salarythrough the Termination Date, and (C) Employee will not be paid or accruethe right to be paid any other compensation. Any amount payable hereunder shall paid pursuant to the applicableprovisions of Sections 3 and 4, above.

 

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(i)            The term “Business Reasons”as used herein means Employee’s: (A) gross negligence, willful misconductor other willful malfeasance in the performance of his duties hereunder; (B) convictionof, or plea of nolo contendere to, or written admission of the commission of, afelony or other criminal offense involving moral turpitude; (C) any actinvolving moral turpitude, fraud or misrepresentation with respect to hisduties for the Company or its affiliates; (D) any act or omission thatconstitutes a failure to follow the reasonable, lawful directives of theCompany’s CEO or Board of Directors or willful, material breach of thisAgreement; provided, that the Board must provide written notice of such failureor breach within five (5) days after the initial act, omission or breachand Employee must fail to correct such failure, omission or breach withintwenty (20) days after his receipt of such written notice.  For purpose of this paragraph, no act orfailure to act by Employee shall be considered “willful” if such act of failureto act occurred at the direction of the Company’s CEO or Board of Directors.

 

(b)           Constructive Termination orTermination without Business Reasons. If (i) Employee terminates his employment as a result of aConstructive Termination, or (ii) the Company terminates Employee’semployment without Business Reasons (excluding because of Employee’s death),then within thirty (30) days of the Termination Date, or earlier if required bylaw, the Company shall pay Employee: (A) all accrued but unpaid PTO,expense reimbursements and other benefits due to Employee through theTermination Date under any Company-provided or paid plans, policies andarrangements, (B) any accrued and unpaid Annual Bonus for a previousfiscal year, which such amount shall be paid pursuant to the provisions of Section 4,above, and (C) all accrued and unpaid salary through the TerminationDate.  In addition, subject to Section 6(e) belowand Employee’s signing and not revoking a general release of claims against theCompany and its successors in a form substantially similar to that attached as Exhibit Aand such release becoming irrevocable within sixty (60) days after the date ofEmployee’s termination, the Company shall pay to Employee upon the expirationof such sixty (60) day period, a lump sum equal to: (1) the amount of hisBase Salary for the greater of: (A) twelve (12) months; or (B) theremainder of the Initial Term that existed as of the Termination Date, ifapplicable; and (2) the Target Bonus.

 

(c)           Constructive Termination.  For purpose of this Agreement, a “ConstructiveTermination” shall be deemed to occur if (1) Employee gives the Companywritten notice of the existence of one of the events arising without Employee’sconsent listed in clauses (i) through (iii) below, within thirty (30)days of the initial existence of such event; (2) the Company has failed tocure such event within thirty (30) days following the date such notice isgiven; and (3) the Employee elects to voluntarily terminate employmentwithin the ninety (90) day period immediately following any of the followingevents: (i) Employee is required to relocate his place of employment,other than a relocation within fifty (50) miles of the Company’s HoustonOffice, (ii) there is an intentional and material reduction in Employee’sBase Salary, other than any such reduction consistent with a general reductionof pay across the executive staff as a group, as an economic or strategicmeasure due to poor financial performance by the Company, (iii) anymaterial breach by the Company of Section 11(c)(i) of this Agreement,provided, that a Constructive Termination will not be deemed to have occurredif, within sixty (60) days of a Change of Control, the Executive is offered anemployment contract by the new owner of the Company which is at least aseconomically favorable to the Executive as this Agreement, (iv) a materialreduction in Executive’s authority, duties, and responsibilities, or (v) thereoccurs any other material breach of this Agreement by the Company

 

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aftera written demand for substantial performance is delivered to the Company byEmployee which specifically identifies the manner in which Employee believesthat the Company has materially breached this Agreement, and the Company hasfailed to cure such breach to the reasonably satisfaction of Employee withinthirty (30) days following the delivery of such notice.

 

(d)           Termination Following a Change inControl.  If there is a Change inControl during the Initial Term or any Renewal Term, as applicable, and either:(i) a Constructive Termination occurs; (ii) the Company terminatesEmployee’s employment without Business Reasons within twelve (12) monthsfollowing the Change in Control; or (iii) the Company elects not to extendthis Agreement for a Renewal Term within the twelve (12) months that follow theChange in Control, then subject to Section 6(e) below and Employee’ssigning and not revoking a general release of claims against the Company andits successors in a form substantially similar to that attached as Exhibit Aand such release becoming irrevocable within sixty (60) days after the date ofEmployee’s termination, the Company shall pay to Employee upon the expirationof such sixty (60) day period, in addition to all amounts otherwise owedhereunder, a lump sum equal to Employee’s Base Salary.  For purposes of this Agreement, a “Changein Control” shall have the same meaning as in Treas. Reg. §§ 1.409A-3(i)(5)(vi) and1.409A-3(i)(5)(vii), except that for purposes of Treas. Reg. §1.409A-3(i)(5)(vi)(1), the phrase “30 percent” shall be replaced with “50percent.”

 

(e)           Code Section 409A Compliance.  To the extent amounts or benefits that becomepayable under this Agreement on account of the Employee’s termination ofemployment (other than by reason of the Employee’s death) constitute “nonqualifieddeferred compensation plan” within the meaning of Code Section 409A (“DeferredCompensation”), payment of such amounts and benefits shall commence whenthe Employee incurs a “separation from service” within the meaning of TreasuryRegulation 1.409A-1(h), without regard to any of the optional provisionsthereunder, from the Company and any entity that would be considered a singleemployer with the Company under Code Section 414(b) or 414(c) (“Separationfrom Service”).  Such payments orbenefits shall be provided in accordance with the timing provisions of thisAgreement by substituting this Agreement’s references to “termination ofemployment” or “termination” with “Separation from Service.”  Notwithstanding the foregoing, if at the timeof the Employee’s Separation from Service, the Employee is a “specifiedemployee” (within the meaning of Code Section 409A and Treasury RegulationSection 1.409A-3(i)(2)), any such Deferred Compensation will not be paiduntil after the earlier of (i) the first business day of the seventh monthfollowing Employee’s Separation from Service, or (ii) the date of theEmployee’s death (the “409A Suspension Period”).  Within 14 calendar days after the end of the409A Suspension Period, the Company shall then pay to Employee, withoutinterest, all such Deferred Compensation that would have otherwise been paidunder this Agreement but for the imposition of the 409A Suspension Period.  Thereafter, the Company shall pay Employeeany remaining unpaid Deferred Compensation in accordance with this Agreement asif there had not been a six-month delay imposed by this paragraph.  For the purpose of this Agreement, eachpayment that is part of a series of installment payments shall be treated as aseparate payment for purposes of Code Section 409A.

 

(f)            Code Section 280G.

 

(i)            Notwithstanding any provision ofthis Agreement to the contrary, if Employee becomes entitled to payment and/orbenefits by this Agreement or any other amounts in

 

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thenature of compensation, whether alone or together or with payments or benefitsthat Employee receives or realizes or is then entitled to receive or realizefrom the Company or any of its affiliates or ay other person whose actionsresult in a change of ownership or effective control of the Company, and suchpayments and/or benefits would constitute an “excess parachute payment” withinthe meaning of Section 280G of the Internal Revenue Code (the “Code”)and/or any corresponding and applicable state law provision, the paymentsand/or benefits provided to Employee under this Agreement will be reduced byreducing the amount of payments or benefits payable to Employee (the “280G Reduction”)to the extent necessary so that no portion of Employee’s payments or benefitswill be subject to the excise tax imposed by Section 4999 of the Code orany interest or penalties are incurred by Employee with respect to such excisetax (such excise tax, together with any such interest and penalties arehereinafter collectively referred to as the “Excise Tax”).  Notwithstanding the foregoing, the 280GReduction will be made only if, by reason of that deduction, Employee’s “netafter tax benefit” (as defined below) exceeds the net after tax benefit hewould realize if the 280G Reduction were not made.  The reduction of payments or benefits shallbe made by reducing, first, cash payments in in the order receivable in time,and then, to the extent necessary, from the non-cash benefits in similarorder.  To the extent that the 280GReduction is not applicable because Employee’s net after tax benefits isgreater than the net after tax benefit that he would receive if the 280GReduction were made, then the Company will pay to Employee a “Gross-Up Payment”as set forth below in Section 6(f)(iii).

 

(ii)           For purposes of this Section 6(f),“net after tax benefit” means the sum of (a) the total amount received orrealized by Employee pursuant to this Agreement that would constitute a “parachutepayment” within the meaning of Section 280G of the Code and anycorresponding and applicable state law provision, plus (b) any and allother payments or benefits that Employee receives or realizes or is thenentitled to receive or realize from the Company and any of its affiliates orthat are otherwise within the scope of payments and/or benefits provided for insub-clause (i) above that would constitute a “parachute payment” withinthe meaning of Section 280G of the Code and any corresponding andapplicable state law provision, less (c) the amount of federal, state andlocal and social security taxes payable with respect to the payments orbenefits described in (a) and (b) above calculated at the maximummarginal individual income tax rate for each year in which payments or benefitsare realized by Employee (based upon the rate in effect for that year as setforth in the Code at the time of the first receipt or realization of theforegoing), less (d) the amount of excise taxes imposed with respect tothe payments or benefits described in (a) and (b) above by Section 4999of the Code and any corresponding and applicable state law provision.

 

(iii)          As provided above, in the event that (a) Employee’snet after tax benefit without the 280G Reduction is greater than the net aftertax benefit that he would receive if the 280G Reduction were made, and (b) itshall be determined that any payment or distribution by the Company to or forthe benefit of Employee (whether paid or payable or distributed ordistributable pursuant to the terms of this Agreement or otherwise, butdetermined without regard to any additional payments required under thisSection) (a “Payment”) would be subject to the Excise Tax, then theCompany will pay to Employee an additional payment (a “Gross-Up Payment”)in an amount such that after payment by Employee of all taxes (including anyinterest or penalties imposed with respect to such taxes), including, withoutlimitation, both any income taxes (and any interest and penalties imposed withrespect thereto), and the Excise Tax imposed upon the Gross-Up

 

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Payment,Employee retains and amount of the Gross-Up Payment equal to seventy-fivepercent (75%) of the Excise Tax imposed upon the Payments.

 

A.            Subject to the provisions of this Section 6(f),all determinations required to be made under this Section, including whetherand when a Gross-Up Payment is required and the amount of such Gross-Up Paymentand the assumptions to be utilized in arriving at such determination, shall bemade by an outside nationally recognized accounting firm selected by theCompany or the Board of Directors of the Company, in its sole and absolutediscretion (the “Accounting Firm”), which shall provide detailedsupporting calculations both to the Company and Employee within 15 businessdays of the receipt of notice from Employee that here has been a Payment, orsuch earlier time as is requested by the Company.  In the event that the Accounting Firm isserving as accountant or auditor for the individual, entity or group effectingthe Change in Control, the Company shall appoint another nationally recognizedaccounting firm to make the determinations required hereunder (which accountingfirm shall then be referred to as the Accounting Firm hereunder).  All fees and expenses of the Accounting Firmshall be borne solely by the Company. Any Gross-Up Payment, if applicable, as determined pursuant to this Section 6(f),shall be paid by the Company to Employee within thirty (30) days of the receiptof the Accounting Firm’s determination, but in no event later than the end ofthe calendar year following the year in which the related taxes are remitted tothe taxing authority.  All determinationsmade by the Accounting Firm shall be based on detailed supporting calculationsprovided both to the Company and Employee at such time as is requested byeither Party.  Any determination by theAccounting Firm shall be binding upon the Company and Employee.  In the event that the Company exhausts itsremedies pursuant to Section 6(f)(iii)(B) and Employee thereafter isrequired to make a payment of any Excise Tax, the Accounting Firm shalldetermine the amount of the Underpayment (as defined below) that has occurredand the Company’s *pro rata*portion of any suchUnderpayment shall be promptly paid by the Company to or for the benefit ofEmployee.  In no event shall the Gross-UpPayment be made later than the end of the service provider’s taxable year nextfollowing the service provider’s taxable year in which the related taxes areremitted to the taxing authority.

 

B.            Employee shall notify the Company inwriting of any claim by the Internal Revenue Service that, if successful, wouldrequire an additional Payment or Payment, as the case may be, which have notbeen made by the Company, but could have been made pursuant to this Section 6(f) (the“Underpayment”).  Suchnotification shall be given as soon as practicable but no later than tenbusiness days after Employee is informed in writing of such claim and shallapprise the Company of the nature of such claim and the date on which suchclaim is requested to be paid.  Employeeshall not pay such claim prior to the expiration of the 30-day period followingthe date on which it gives such notice to the Company (or such shorter periodending on the date that any payment of taxes with respect to such claim isdue).  If the Company notifies Employeein writing prior to the expiration of such period that it desires to contestsuch claims, Employee shall:

 

(i)                                     give the Company anyinformation reasonably requested by the Company relating to such claim;

 

(ii)                                  take such action inconnection with contesting such claim as the Company shall reasonably requestfrom time to time including, without limitation, accepting legal representation

 

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withrespect to such claim by an attorney reasonably selected by the Company;

 

(iii)          cooperate with the Company in goodfaith in order to effectively contest such claim; and

 

(iv)                              permit the company toparticipate in any proceedings relating to such claim; provided, however, thatthe Company shall bear and pay directly all reasonable costs and expenses(including additional interest and penalties) incurred in connection with suchcontest and shall indemnify and hold Employee harmless, on an after-tax basis,for seventy-five percent (75%) of any Excise Tax or income tax (includinginterest and penalties with respect thereto) imposed as a result of such representationand payment of costs and expenses.  In noevent shall the payment of any Excise Tax or income tax (including interest andpenalties related thereto) be made later than the end of the service provider’staxable year next following the service provider’s taxable year in which therelated taxes are remitted to the taxing authority.  Without limitation on the foregoingprovisions of this Section 6(f)(iii)(B), the Company shall control allproceedings taken in connection with such contest and, at it sole option, maypursue or forego any and all administrative appeals, proceedings, hearings andconfdrences with the taxing authority in respect of such claim and may, at itssole option, either direct Employee to pay the tax claimed and sue for a refundor contest the claim in any permissible manner, and Employee agrees toprosecute such contest tot a determination before any administrative tribunal,in a court of initial jurisdiction and in one or more appellate courts, as theCompany shall determine and subject to the Company covering all out of pocketexpenses incurred in such contest; provided, however, that if the Companydirects Employee to pay such claim and sue for a refund, the Company shalladvance the amount of such payment to Employee that represents the Company’s *pro rata*share of any payment, on an interest-free basis andshall indemnify and hold Employee harmless, on an after-tax basis, from theCompany’s pro rata share of any Excise Tax or income tax (including interest orpenalties with respect thereto) imposed with respect to such advance or withrespect to any imputed income with respect to such advance; and furtherprovided that any extension of the statute of limitations relating to paymentof taxes for the taxable year of Employee with respect to which such contestedamount is claimed to be due is limited solely to such contested amount.

 

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Furthermore,the company’s control of the contest shall be limited to issues and/or claimsthat are materially related to the imposition of any Excise Tax or with respectto which a Gross-Up Payment would otherwise be payable hereunder and Employeeshall be entitled to settle or context, as the case may be, any other issueraised by the Internal Revenue Service or any other taxing authority.  The Parties shall promptly deliver to eachother copies of any written communications and summaries of any verbal communicationswith any taxing authority regarding the matters addressed herein.

 

C.            If, after the receipt byEmployee of an amount advanced by the Company pursuant to Section 6(f)(iii)(B),Employee becomes entitled to receive any refund with respect to such claim,Employee shall (subject to the Company’s complying with the requirements of Section 6(f)(iii)(B))promptly pay to the Company the amount of such refund (together with anyinterest paid or credited thereon after taxes applicable thereto).  If, after the receipt by Employee of anamount advanced by the Company pursuant to Section 6(f)(iii)(B), adetermination is made that Employee shall not be entitled to any refund withrespect to such claim and the Company does not notify Employee in writing ofits intent to contest such denial of refund prior to the expiration of 30 daysafter such determination, then such advance shall be forgiven and shall not berequire to be repaid and the amount of such advance shall offset, to the extentthereof, the amount of Gross-Up Payment required to be paid.

 

7.             ConfidentialInformation.

 

(a)           Employee acknowledges that the ConfidentialInformation relating to the business of the Company and its subsidiaries whichEmployee has obtained or will obtain during the course of his association withthe Company and subsidiaries and his performance under this Agreement are theproperty of the Company and its subsidiaries. Employee agrees that Employee will not disclose or use at any time, eitherduring or after the Employment period, any Confidential Information without thewritten consent of the Board of Directors of the Company, other than properdisclosure or use in the performance of his duties hereunder.  Employee agrees to deliver to the Company atthe end of the term of his employment, or at any other time that the Companymay request, all memoranda, notes, plans, records, documentation and othermaterials (and copies thereof) containing Confidential Information relating tothe business of the Company and its subsidiaries, no matter where such materialis located and no matter what form the material may be in, which Employee maythen possess or have under his control. If requested by the Company, Employee shall provide to the Company writtenconfirmation that all such materials have been delivered to the Company or havebeen destroyed.  Employee shall take allreasonable steps to safeguard Confidential Information and to protect itagainst disclosure, misuse, espionage, loss and theft.

 

(b)           “Confidential Information” shall meaninformation which is not generally known to the public and which is used,developed, or obtained by the Company or its subsidiaries relating to thebusinesses of any of the Company and its subsidiaries or the business of anycustomer thereof including, but not limited to: pricing models; products orservices; fees, costs and pricing 

 

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structure;designs; analyses; formulae; drawings; photographs; reports; computer software,including operating systems, applications, program listings, flow charts,manuals and documentation; databases; accounting and business methods;inventions and new developments and methods, whether patentable or unpatentableand whether or not reduced to practice; all copyrightable works; the customersof any of the Company and its subsidiaries and the Confidential Information ofany customer thereof; and all similar and related information in whateverform.  Confidential Information shall notinclude any information which (i) was rightfully known by Employee priorto the beginning of his employment with the Company; (ii) is publiclydisclosed by law or in response to an order of a court or governmental agency; (iii) becomespublicly available through no fault of Employee or (iv) has been publishedin a form generally available to the public prior to the date upon whichEmployee proposes to disclose such information. Information shall not be deemed to have been published merely becauseindividual portions of the information have been separately published, but onlyif all the material features comprising such information have been published incombination.

 

8.             IntellectualProperty.  In theevent that Employee, as a part of Employee’s activities on behalf of theCompany, generates, authors or contributes to any invention, new development ormethod, whether or not patentable and whether or not reduced to practice, anycopyrightable work, any trade secret, any other Confidential Information, orany information that gives any of the Company and its subsidiaries an advantageover any competitor, or similar or related developments or information relatedto the present or future business of any of the Company and its subsidiaries(collectively “Developments and Information”), Employee acknowledgesthat all Developments and Information are “work for hire” and the exclusiveproperty of the Company.  Employee herebyassigns to the Company, its nominees, successors or assigns, all rights, titleand interest to Developments and Information. Employee shall cooperate with the Company’s Board of Directors toprotect the interests of the Company and its subsidiaries in Developments andInformation.  Employee shall execute andfile any document related to any Developments and Information requested by theCompany’s Board of Directors including applications, powers of attorney,assignments or other instruments which the Company’s Board of Directors deemsnecessary to apply for any patent, copyright or other proprietary right in anyand all countries or to convey any right, title or interest therein to any ofthe Company’s nominees, successors or assigns.

 

9.             No Conflicts.

 

(a)           Employee agrees that in hisindividual capacity he will not enter into any agreement, arrangement orunderstanding, whether written or oral, with any supplier, contractor,distributor, wholesaler, sales representative, representative group orcustomer, relating to the business of the Company or any of its subsidiaries,without the express written consent of the Board, Chief Executive Officer orChief Financial Officer.

 

(b)       As long as Employee isemployed by the Company or any of its subsidiaries, Employee agrees thatEmployee will not, except with the express written consent of the Board, becomeengaged in, render services for, or permit his name to be used in connectionwith, any for-profit business other than the business of the Company, any ofits subsidiaries or any corporation or partnership in which the Company or anyof its subsidiaries have an equity interest.

 

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10.           Non-Competition Agreement.

 

(a)       Employee acknowledges thatEmployee’s services are of a special, unique and extraordinary value to theCompany and that Employee has access to the Company’s trade secrets,Confidential Information and strategic plans of the most valuable nature anddevelops goodwill on behalf of the Company. Accordingly, Employee agrees that during the Restricted Term (as definedbelow), Employee shall not directly or indirectly own, manage, control, participatein, consult with, render strategic, managerial sales, marketing, investment,financial, or other non-administrative services for, or in any manner engage inany business Competing (as defined below) with the businesses of the Company orany of its subsidiaries as such businesses exist or are in process ofdevelopment on the Termination Date (as evidenced by written proposals, marketresearch or similar materials).  Abusiness is a Competing business if it engages in the deregulated retailmarketing of natural gas or electricity in markets in which the Company hasoperated at any time during the two-year period ending on the TerminationDate.  Nothing herein shall prohibitEmployee from being a passive owner of not more than 5% of the outstandingstock of any class of a corporation that is publicly traded, so long asEmployee has no active participation in the business of such corporation.  For purposes of this Agreement, the “RestrictedTerm” shall run through the duration of the Employment Period, and if Employeehas received a severance payment under Section 6(b), one year thereafter.

 

(b)               In addition, during theRestricted Term, Employee shall not (i) directly or indirectly induce orattempt to induce any employee of the Company or any subsidiary (other than hisown assistant) to leave the employ of the Company or such subsidiary, or in anyway interfere with the relationship between the Company or any subsidiary andany employee thereof, (ii) hire directly or through another entity anyperson who was an employee of the Company or any subsidiary at any time duringthe then-preceding 12 months (unless such employee contacts the Employee on anunsolicited bases), (iii) directly or indirectly induce or attempt toinduce any customer, supplier, licensee or other business relation of theCompany or any subsidiary to cease doing business with the Company or suchsubsidiary, or in any way interfere with the relationship between any suchcustomer, supplier, licensee or business relation and the Company or any subsidiary,or (iv) disparage the Company, its executive officers, or its directors.

 

(c)       If any court or tribunal ofcompetent jurisdiction shall determine any of the foregoing covenants to beunenforceable with respect to the term thereof or the scope of the subjectmatter or geography covered thereby, such remaining covenants shall nonethelessbe enforceable by such court or tribunal against such other party or parties orupon such shorter term or within such lesser scope as may be determined by thecourt or tribunal to be enforceable.

 

(d)       Because Employee’s servicesare unique and because Employee has access to Confidential Information andstrategic plans of the Company of the most valuable nature and will help theCompany develop goodwill, the parties agree that the covenants contained inthis Section 10 are necessary to protect the value of the business of theCompany and that a breach of any such covenant would result in irreparable andcontinuing damage for which there would be no adequate remedy at law.  The Parties agree therefore that in the eventof a breach or threatened breach of this Agreement, the Company or itssuccessors or assigns may, in addition to other rights and remedies existing intheir favor, apply to any court of competent jurisdiction for specific 

 

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performance and/or injunctive or other relief inorder to enforce, or prevent any violations of, the provisions hereof.  The Parties further agree that in the eventthe Company is granted any such injunctive or other relief, the Company shallnot be required to post any bond or security that may otherwise normally beassociated with such relief.

 

12.           Miscellaneous Provisions.

 

(a)       Notice.  Notices and all other communicationscontemplated by this Agreement shall be in writing, shall be effective whengiven, and in any event shall be deemed to have been duly given (i) whendelivered, if personally delivered, (ii) three (3) business daysafter deposit in the U.S. mail, if mailed by U.S. registered or certified mail,return receipt requested, or (iii) one (1) business day after thebusiness day of deposit with Federal Express or similar overnight courier, ifso delivered, freight prepaid.  In thecase of Employee, notices shall be addressed to him at the home address whichhe most recently communicated to the Company in writing which, as of theEffective Date, is 6509 Edloe Street, Houston, TX 77005.  In the case of the Company, notices shall beaddressed to its corporate headquarters, and all notices shall be directed tothe attention of its Corporate Secretary.

 

(b)       Notice of Termination.  Any termination by the Company or Employeeshall be communicated by a notice of termination to the other Party heretogiven in accordance with paragraph (a) hereof.  Such notice shall indicate the specifictermination provision in this Agreement relied upon.

 

(c)       Successors.

 

(i)    Company’s Successors.  Any successor to the Company (whether director indirect and whether by purchase, lease, merger, consolidation, liquidationor otherwise) to all or substantially all of the Company’s business and/orassets shall be entitled to assume the rights and shall be obligated to assumethe obligations of the Company under this Agreement and shall agree to performthe Company’s obligations under this Agreement in the same manner and to thesame extent as the Company would be required to perform such obligations in theabsence of a succession.  For allpurposes under this Agreement, the term “Company” shall include any successorto the Company’s business and/or assets which executes and delivers theassumption agreement described in this subsection (i) or which becomesbound by the terms of this Agreement by operation of law.

 

(ii)   Employee’s Successors.  The terms of this Agreement and all rights ofEmployee hereunder shall inure to the benefit of, and be enforceable by,Employee’s personal or legal representatives, executors, administrators,successors, heirs, distributees, devisees and legatees.

 

(iii)  No Other Assignment ofBenefits.  Except asprovided in this Section 11(c) and in Section 6above, the rights of any person to payments or benefits under this Agreementshall not be made subject to option or assignment, either by voluntary orinvoluntary assignment or by operation of law, including (without limitation)bankruptcy, garnishment, attachment or other creditor’s process, and any actionin violation of this subsection (iii) shall be void.

 

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(d)       Waiver.  No provision of this Agreement shall bemodified, waived or discharged unless the modification, waiver or discharge isagreed to in writing and signed by Employee and by an authorized officer of theCompany (other than Employee).  No waiverby either Party of any breach of, or of compliance with, any condition orprovision of this Agreement by the other Party shall be considered a waiver ofany other condition or provision or of the same condition or provision atanother time.

 

(d)   Entire Agreement.  This Agreement shall supersede any and allprior agreements, representations or understandings (whether oral or writtenand whether express or implied) between the Parties with respect to the subjectmatter hereof, including without limitation that certain Employment Agreemententered into between the Parties on August 14, 2006, as amended (the “PriorEmployment Agreement”).  The Partiesexpressly acknowledge and agree that this Agreement supersedes the PriorEmployment Agreement in its entirety.

 

(e)   Severability.  The invalidity or unenforceability of anyprovision or provisions of this Agreement shall not affect the validity orenforceability of any other provision hereof, which shall remain in full forceand effect.

 

(f)    Arbitration.  Except for injunctive or other equitablerelief in aid of arbitration, any dispute or controversy arising under or inconnection with this Agreement shall be settled exclusively by arbitration inHouston, Texas, in accordance with the rules of the American ArbitrationAssociation then in effect.  Judgment maybe entered on the arbitrator’s award in any court having jurisdiction.  No Party shall be entitled to seek or beawarded punitive damages. All attorneys fees and costs shall be allocated orapportioned as agreed by the Parties or, in the absence of an agreement, insuch manner as the arbitrator or court shall determine to be appropriate toreflect the final decision of the deciding body as compared to the initialpositions in arbitration of each party.  **THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BYTHE LAWS OF THE STATE OF NEW YORK AS THEY APPLY TO CONTRACTS ENTERED INTO ANDWHOLLY TO BE PERFORMED WITHIN SUCH STATE BY RESIDENTS THEREOF.**

 

(g)   Withholding of Taxes.  All payments made pursuant to this Agreementwill be subject to withholding of applicable taxes.

 

(h)   Indemnification.  Employee will be covered under the Company’sinsurance policies and, subject to applicable law, will be providedindemnification to the maximum extent permitted by the Company’s bylaws and Certificateof Incorporation, with such insurance coverage and indemnification to be inaccordance with the Company’s standard practices for senior executive officersbut on terms no less favorable than provided to any Company senior executiveofficer or director.  Indemnificationshall not be awarded for any conduct that is found to be breach by a Court ortribunal of competent jurisdiction to violate this agreement.

 

(i)    Compliance with CompanyPolicies.  During theEmployment Term, Employee will comply with all Company policies generallyapplicable to the Company’s similarly situated employees.

 

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(j)    Counterparts.  This Agreement may be executed incounterparts, each of which shall be deemed an original, but all of whichtogether will constitute one and the same instrument.

 

(k)   Non-Disclosure.  Unless required by law or to enforce thisAgreement, the Parties shall not disclose the existence of this Agreement orthe underlying terms to any third party, other than their representatives whohave a need to know such matters.

 

(l)    Legal Fees.  Within thirty (30) days of the EffectiveDate, the Company shall pay the reasonable legal fees incurred by Employee inconnection with the negotiation and drafting of this Agreement in an amount notto exceed $7,500.00.

 

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INWITNESS WHEREOF, each of the Parties has executed this Agreement, in the caseof the Company by its duly authorized officer, as of the day and year firstabove written.

 

 
|   | MxENERGY  INC. |
|--------|----------------|
|   |           |
|   |           |   |
|   | By:            | /s/  Jeffrey A. Mayer |
|   | Name:          | Jeffrey  A. Mayer |
|   | Title:         | President  and Chief Executive Officer |
|   |           |   |
|   |           |
|   | EMPLOYEE       |
|   |           |
|   |           |   |
|   | By:            | /s/Robert  Werner |
|   |           | Robert  Werner |

 

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**EXHIBIT A**

 

**FORM OF RELEASE AGREEMENT**

 

This ReleaseAgreement (this “***Agreement***”)constitutes the release referred to in that certain Employment Agreement (the “***Employment Agreement***”)dated as of April 1, 2010, by and among Robert Werner (“***Employee***”) and MXEnergy, Inc. (the “***Company***”).

 

(a)  For good and valuable consideration,including the Company’s provision of certain severance payments in accordancewith Section 6 of the Employment Agreement, Employee hereby releases theCompany from liability for, and hereby waives, any and all claims, damages, orcauses of action of any kind related to Employee’s employment with the Companyor the termination thereof, including without limitation all claims, damagesand cuases of action arising out of the Age Discrimination in Employment Act of1967, as amended (collectively, the ***“Released Claims”***).  In no event shallthe Released Claims include (a) any claim which arises after the date ofthis Agreement, (b) any claim to vested benefits under an employee benefitplan, (c) any claims for contractual payments under the EmploymentAgreement, or (d) any claims to Company stock or otherwise relating to anyequity interest that Employee may have.

 

(b)   By signing this Agreement, Employee is boundby it.  Anyone who succeeds to Employee’s rights and responsibilities,such as heirs or the executor of Employee’s estate, is also bound by thisAgreement.

 

(c)           Employee agrees not to bring or join anylawsuit in any court relating to any of the Released Claims.  Employeerepresents that Employee has not brought or joined any lawsuit or filed anycharge or claim against the Company in any court or before any government agencyor arbitratror and has made no assignment of any rights Employee has assertedor may have against the Company to any person or entity, in each case, withrespect to any Released Claim.

 

(d)           By executing and delivering this Agreement,Employee acknowledges that:

 

(i)            Employee has carefully read this Agreement;

 

(ii)                                  Employee has had at least [twenty-one (21)][forty-five (45)] days to consider this Agreement before the execution anddelivery hereof to the Company;

 

(iii)                               Employee has been and hereby is advised inwriting that Employee may, at Employee’s option, discuss this Agreement with anattorney of Employee’s choice and that Employee has had adequate opportunity todo so; and

 

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(iv)                              Employee fully understands the final andbinding effect of this Agreement; the only promises made to Employee to signthis Agreement are those stated in the Employment Agreement and herein; andEmployee is signing this Agreement voluntarily and of Employee’s own free will,and that Employee understands and agrees to each of the terms of thisAgreement.

 

Notwithstandingthe initial effectiveness of this Agreement, Employee may revoke the delivery(and therefore the effectiveness) of this Agreement within the seven day periodbeginning on the date Employee delivers this Agreement to the Company (suchseven day period being referred to herein as the ***“Release Revocation Period”***).  Tobe effective, such revocation must be in writing signed by Employee and must bedelivered to the Chairman of the Board of Directors of the Company before 11:59 p.m.,Houston, Texas time, on the last day of the Release Revocation Period.  Ifan effective revocation is delivered in the foregoing manner and timeframe,this Agreement shall be of no force or effect and shall be null and void abinitio.  No consideration shall be paid if this Agreement is revokedby Employee in the foregoing manner.

 

Executed on this                      day of                          ,              .

 

 
|   |           |
|--------|----------------|
|   | Robert  Werner |

 

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