Exhibit 10.19


 


EMPLOYMENT
AGREEMENT


 


This Employment Agreement (the “Agreement”) is
entered into on August 4, 2006, by and between Steven Murray, an individual (“Executive”)
and MxEnergy Inc., a Delaware corporation (the “Company”). Terms within
this Agreement that begin with initial capital letters shall have the meaning
specially set forth herein, unless the context clearly demonstrates a different
meaning (see Section 7 of this Agreement for the definition of several terms).


 


1.             Employment.


 


(a)           Officer.
Executive will serve as Chief Operating Officer of the Company for the
Employment Term specified in Section 2 below. Executive will report to the
Chief Executive Officer (the “CEO”), and will render such services
consistent with the foregoing role. The parties anticipate that such services
will include (but not be limited to) participating in the Company’s efforts to
consummate an initial public offering of its Common Stock. Executive’s office
shall be located at the executive offices of the Company in Houston, Texas.


 


(b)           Director. As
soon as practical after the execution of this Agreement, the Company shall
increase the size of its Board of Directors (the Board) by one director, and
shall appoint the Executive to fill such vacancy. During the remainder of the
Employment Term (as defined below), the Company shall use its best efforts to
ensure that Executive continues to serve as a member of the Board.


 


2.             Term.
Company’s employment of Executive pursuant to this Agreement shall be for an
initial term of three (3) years (the “Employment Term”), beginning on
the expiration or waiver of any requisite notice period in connection with the
termination of his current employment arrangement with Shell Energy Services
Company, L.L.C. (the “Commencement Date”) and ending on the third annual
anniversary of the Commencement Date (the “Expiration Date”) or such
earlier date on which Executive’s employment terminates in accordance with
Section 6 of this Agreement. On the Expiration Date and each anniversary
thereof, this Agreement shall automatically renew for a one-year term unless
(a) the Agreement has been earlier terminated under Section 6 or (b) either
party gives written notice not less than 180 days prior to the expiration of
any such term that the Agreement will not be extended. Upon termination of the
Employment Term for any reason, Executive shall promptly resign from all
positions held with the Company.


 


3.             Salary. The
Company shall pay Executive base salary (“Base Salary”) at an annual
rate of $450,000. Executive’s Base Salary shall be paid in conformity with the
Company’s salary payment practices generally applicable to similarly situated
Company executives.


 


4.             Bonus.


 


(a)           Annual Bonus.
Executive shall be entitled to participate in the Company’s executive bonus program.
Executive’s annual target bonus (the “Target Bonus”) shall be 100% of
Base Salary, of which (a) 75% shall be payable based on achievement of Company
and/or individual objectives specified by the Compensation Committee (the
“Compensation Committee”) of the Board of Directors of the Company (the “Board”),
and (b) 25% may be awarded solely at the discretion of


 

















 


the
Compensation Committee. In addition, the Compensation Committee may, in its
sole discretion, award the Executive an additional bonus of up to 20% of Base
Salary for extraordinary performance by the Executive in connection with a
significant business event affecting the Company, such as an initial public
offering or a Change in Control; provided, however, that absent special
circumstances the maximum actual bonus will not exceed 120% of Base Salary.


 


(b)           Signing Bonus.
The Company shall be obligated to pay Executive a signing bonus in the amount
of $150,000 (the “Signing Bonus”), which shall be payable upon the Commencement
Date. The parties agree that the Signing Bonus shall be reduced by any bonus
Executive receives on account of (i) the proposed transaction pursuant to the
Asset Purchase Agreement between the Company and Shell Energy Services Company,
L.L.C. (“SESCO”) and (ii) his performance during SESCO’s fiscal year 2006
through the termination of his employment with the SESCO.


 


5.             Executive Benefits.


 


(a)           Stock Options.
The Company shall grant Executive a nonqualified stock option to purchase an
aggregate of 150,000 shares of Common Stock of the Company in accordance with
the Company’s 2006 Equity Incentive Compensation Plan (the “Plan”). The
stock options shall have an exercise price equal to the fair market value of
the underlying shares on the grant date (as determined by the Board), and shall
vest in equal annual installments on the first three annual anniversaries of
the date of grant, subject to Executive’s continued employment with the Company
on each vesting date; provided that the third and final installment shall vest
on the Expiration Date even in the event this Agreement is not extended. Except
as otherwise provided herein and in the next paragraph, the stock options shall
be on terms and conditions consistent with the Company’s standard form of
notice of grant and the Plan.


 


(b)           Repurchase of Common
Stock. In the event that Executive’s employment terminates for any reason,
the Company shall have the right (or obligation) to purchase all of the shares
of Common Stock that the Executive owns subject to the terms and conditions set
forth herein.


 


(i)            If Executive’s
employment is terminated for any reason during the Employment Term, the Company
shall have the initial right to purchase all (but not less than all) of the
Common Stock owned by the Executive (“Call Option”). The Company shall have the
right to exercise the Call Option by giving written notice to Executive within
sixty (60) days after the date of termination, which shall set forth the fair
market value of the shares being purchased as determined in the good faith of
the Board (“Call Notice”). In the event that the Company fails to exercise the
Call Option on a timely basis, its rights under this Section 5(b)(i) shall
automatically terminate. If the Call Notice is delivered on a timely basis and
the Executive agrees with the valuation set forth in the Call Notice, he shall
provide a written acceptance to the Company within fifteen (15) days from the
date of the Call Notice, and the repurchase of the shares shall occur within
fifteen (15) days from the date of acceptance. If, however, the Call Notice is
delivered on a timely basis and the Executive disagrees with the valuation set
forth therein, the repurchase price for the shares shall be determined in
accordance with Section 5(b)(iii) below.


 


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(ii)           If Executive’s
employment is terminated for any reason during the Employment Term, but the
Company does not exercise the Call Option on a timely basis, the Executive
shall have the right to cause the Company to repurchase all (but not less than
all) of the Common Stock owned by the Executive (“Put Option”). The Put Option
shall become exercisable upon the expiration of the Call Option. The Executive
shall have the right to exercise the Put Option by giving written notice to the
Company within sixty (60) days after the expiration of the Call Option, which
shall set forth the fair market value of the shares being sold to the Company
as determined in good faith by the Executive (“Put Notice”). If the Executive
fails to exercise the Put Option on a timely basis, his rights under this
Section 5(b)(ii) shall automatically terminate. If the Put Notice is delivered
on a timely basis and the Company agrees with the valuation set forth in the
Put Notice, it shall provide a written acceptance to the Executive within
fifteen (15) days from the date of the Put Notice, and the repurchase of the
shares shall occur within fifteen (15) days from the date of acceptance. If,
however, the Put Notice is delivered on a timely basis and the Company disagrees
with the valuation set forth therein, the repurchase price for the shares shall
be determined in accordance with Section 5(b)(iii) below.


 


(iii)          In the event that
Executive’s employment terminates for any reason, the Company shall have the
right to repurchase, or the Executive shall have the right to cause the Company
to repurchase, all or part of the shares of Common Stock that the Executive
owns. The repurchase price shall equal the fair market value of the shares, as
established by the Board in its discretion, being repurchased. If the Executive
does not agree with the Board’s determination of the fair market value of those
shares, then the Executive and the Company shall mutually select a neutral
independent valuation firm that will establish the fair market value of the
shares being repurchased, and that firm’s determination of fair market value
will be binding on all parties. If the Executive and the Company do not agree
on a neutral independent valuation firm, each of the Executive and the Company shall
appoint their own independent representative; and such independent
representatives shall select the neutral independent valuation firm. The
Company shall pay all fees related to the expense associated with such
valuation.


 


(iv)          If (A) the Company repurchases
the Common Stock held by the Executive pursuant to Section 5(b)(i) or 5(b)(ii)
above, (B) the Company enters into an agreement to effect a Change in Control
within six (6) months following the date of such repurchase, and (C) the per
share consideration to be received by the holders of Common Stock in connection
with the Change of Control is greater than the per share consideration received
by the Executive for his Common Stock hereunder, then the Company shall be
obligated to pay additional consideration to Executive in an amount equal to
the difference (“Additional Consideration”). Any Additional Consideration
payable hereunder shall be paid by the Company in cash within five (5) business
days following the consummation of the Change of Control transaction. To the
extent the consideration received by holders of Common Stock in connection with
the Change of Control is in the form of securities, the value of such
consideration will be based on the market value upon the closing of the Change
of Control, or if no market exists, it will be based on the good faith
determination of the Board.


 


(v)           Notwithstanding the
foregoing, the rights under this Section 5(b) shall automatically terminate
upon an initial public offering of the Common Stock of the Company, or to the
extent the Company becomes a reporting company under the Securities Exchange
Act of 1934.


 


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(c)           Other Employee and
Executive Benefits. During the Employment Term, the Company shall pay for
Executive’s membership in the Plaza Club or its successors or assigns (with
such membership to be used for Company purposes), and the Young President’s
Organization or its successors or assigns (“YPO”). The Company will also
reimburse the Executive for certain expenses related to YPO activities in an
amount up to $25,000 per annum. In addition, Executive shall be entitled to
receive all benefits provided to senior executives, executives and employees of
the Company generally from time to time, including health, life insurance and
disability, and all other benefits provided to the Company’s senior executives
generally, in each case so long as and to the extent the same exist; provided,
that in respect to each such plan Executive is otherwise eligible and insurable
in accordance with the terms of such plans. Notwithstanding the preceding
sentence, Executive’s right to receive severance payments and benefits shall be
only as provided in Section 6 hereof.


 


(d)           Vacation, Sick
Leave, Holidays and Sabbatical. Executive shall be entitled to paid time
off (“PTO”), sick leave, and holidays in accordance with the policies of
the Company, as they exist from time to time, for senior executives. PTO not
used during any calendar year will not roll over to the following year.


 


6.             Severance Benefits.


 


(a)           At Will Employment.
Executive’s employment shall be “at will.” 
Either the Company or Executive may terminate this agreement and
Executive’s employment at any time, with or without Business Reasons, in its or
his sole discretion, upon sixty (60) days’ prior written notice of termination.


 


(b)           Involuntary
Termination Without Business Reasons. If at any time during the Employment
Term (other than following a Change in Control to which Section 6(c) applies)
the Company terminates the employment of Executive involuntarily and without
Business Reasons or a Constructive Termination occurs, then subject to
Executive’s signing and not revoking a general release of claims against the
Company and its successors, Executive shall be entitled to receive the
following:


 


(i)            Base Salary, PTO, and
any earned and unpaid Annual Bonus accrued through the Termination Date, and
any expense reimbursements and other benefits due to the Executive under any
Company-provided plans, policies and arrangements;


 


(ii)           a lump sum equal to the
greater of (A) Executive’s Base Salary for a period of twelve months following
the Termination Date, or (B) Executive’s Base Salary for the remainder of the
then-current Employment Term;


 


(iii)          a lump sum equal to (A)
seventy-five percent (75%) of the Target Bonus for the fiscal year in which the
termination occurs, (B) seventy-five percent (75%) of the Target Bonus for any
full fiscal year remaining during the Employment Term, and (C) a pro rata
portion of seventy-five percent (75%) of the Target Bonus being paid for the
final fiscal year that begins during the Employment Term (such pro rata amount
will be based on the ratio of the number of full months of the Employment Term
that fall within such final fiscal year, to 12); and


 


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(iv)          subject to Section 5(b)
which shall remain applicable to any shares purchased through Executive’s
exercise of stock options, all of the Executive’s unvested stock options and
other equity awards shall become fully vested, and all stock options that are
vested and outstanding (but unexercised) on the Termination Date shall be
cancelled in consideration of the Company’s payment to the Executive, as soon
as practicable after the Termination Date, of an amount equal to the product of
the following:


 


(A)                              the
excess, if any, of (1) the per share fair market value, as determined pursuant
to Section 5(b) above, of the shares underlying the cancelled stock options,
over (2) the weighted average exercise price per share of the Company Common
Stock subject to such option, multiplied by


 


(B)                                the
number of shares of Company Common Stock that are subject to the stock options
being cancelled).


 


Notwithstanding the foregoing, if Executive violates
the provisions set forth in Section 11, Executive no longer shall be entitled
to receive any consideration otherwise paid pursuant to this section, and any
unexercised stock options, whether vested or unvested, will be cancelled.


 


(c)           Change in Control.
If there is a Change in Control during the Employment Term, and either a
Constructive Termination occurs or the Company terminates the Executive’s
employment without Business Reasons prior to the Expiration Date, the Executive
shall receive the benefits set forth in Section 6(b), subject to its terms and
conditions.


 


(d)           Termination for
Disability. If at any time during the Employment Term Executive becomes
unable to perform his duties as an employee as a result a Disability, which
gives rise to termination of employment for Disability, then (i) Executive
shall be entitled to receive payments and benefits in accordance with the
Disability policies of the Company, as they exist from time to time, for senior
executives and (ii) Executive’s outstanding stock options and other equity
arrangements shall expire in accordance with the terms of the applicable award
agreement(s). The payments and benefits contemplated under clause (i) above
shall include, without limitation, the following:  (v) any accrued and unpaid salary, (w) any
accrued and unpaid Annual Bonus for a prior fiscal year, (x) a pro-rata portion
of any Annual Bonus that Executive would have otherwise earned during the
fiscal year in which his Disability occurs, (y) any accrued and unpaid PTO, and
(z) any expense reimbursements.


 


(e)           Voluntary
Termination or Involuntary Termination for Business Reasons. If (i)
Executive voluntarily terminates his employment (other than in the case of a
Constructive Termination), or (ii) Executive is terminated involuntarily for
Business Reasons, then in any such event (A) all further vesting of Executive’s
stock options and other equity arrangements will cease immediately and such
awards will expire in accordance with the terms of the applicable award
agreement(s), (B) all payments of compensation by the Company to Executive
hereunder will terminate immediately , (C) 
Executive will be paid all accrued but unpaid PTO, expense
reimbursements and other benefits due to Executive through his termination date
under any Company-provided or paid plans, policies, and arrangements, and (D)
Executive will be paid all accrued and unpaid salary, all accrued and unpaid
Annual Bonus for a prior fiscal year, and a pro-


 


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rata portion
of any Annual Bonus that Executive would have otherwise earned during the
fiscal year in which his termination occurs hereunder.


 


(f)            Termination Upon
Death. If Executive’s employment is terminated because of death, then (i)
Executive’s representatives shall be entitled to receive payments and benefits
in accordance with the Company’s then applicable plans, policies, and
arrangements and (ii) Executive’s outstanding stock options and other equity
arrangements shall expire in accordance with the terms of the applicable award
agreement(s). The payments and benefits contemplated under clause (i) above
shall included, without limitation, the following:  (v) any accrued and unpaid salary, (w) any
accrued and unpaid Annual Bonus for a prior fiscal year, (x) a pro-rata portion
of any Annual Bonus that Executive would have otherwise earned during the
fiscal year in which his death occurs, (y) any accrued and unpaid PTO, and (z)
any expense reimbursements.


 


(g)           Succession to CEO
Position. If at any time during the Employment Term (other than following a
Change in Control to which Section 6(c) applies) Jeffrey Mayer ceases to be the
CEO of the Company, and the Company does not offer the CEO position to
Executive within the earlier to occur of (i) the date on which the Company
hires or appoints a successor CEO or (ii) three (3) months after the last day that Mr. Mayer serves
as CEO of the Company, and Executive thereafter voluntarily terminates his
employment, Executive shall receive the benefits described in Section 6(b).


 


(h)           Exclusivity. The
provisions of this Section 6 are intended to be and are exclusive and in lieu
of any other rights or remedies to which Executive or the Company may otherwise
be entitled, either at law, tort or contract, in equity, or under this
Agreement, in the event of any termination of Executive’s employment. Executive
shall be entitled to no benefits, compensation or other payments or rights upon
termination of employment other than those benefits expressly set forth in
paragraph (b), (c), (d), (e) or (f) of this Section 6, whichever shall be
applicable and those benefits required to be provided by law.


 


(i)            409A Compliance.
Notwithstanding anything in this Section 6 to the contrary, if the Company
determines in good faith that any payment or benefit to the Executive under
this Section 6, that is payable to the Executive on account of a termination of
employment with the Company, constitutes a “deferral of compensation” under
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) (as
set forth in IRS Notice 2005-1, Q&A-4 or successor Temporary or Final
Treasury Regulations) and the Executive is a “specified employee” within the
meaning of Code Section 409A(a)(2)(B)(i), the Company shall delay commencement
of any such payment or benefit until six months after the Executive’s last day
of employment with the Company (the “409A Suspension Period”). Within fourteen
calendar days after the end of the 409A Suspension Period, the Company shall
pay to the Executive a lump sum payment in cash equal to any payments (including
interest on any such payments, at an interest of not less than the prime
interest rate, as published in the Wall Street Journal, over the period such
payment is restricted from being paid to the Executive) and benefits that the
Company would otherwise have been required to provide under this Section 6 but
for the imposition of the 409A Suspension Period. Thereafter, the Executive
shall receive any remaining payments and benefits due under this Section 6 in
accordance with the terms of this Section (as if there had not been any
suspension period beforehand).


 


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7.             Definition of
Terms. The following terms referred to in this Agreement shall have the
following meanings:


 


(a)           Business Reasons.
“Business Reasons” means (i) gross negligence, willful misconduct or other
willful malfeasance by Executive in the performance of his duties, (ii)
Executive’s conviction of, plea of nolo
contendere to, or written admission of the commission of, a felony,
or an other criminal offense involving moral turpitude, (iii) any act by the
Executive involving moral turpitude, fraud or misrepresentation with respect to
his duties for the Company or its affiliates, (iv) any act by the Executive
constituting a failure to follow the directions of the either the CEO or the
Board, provided that, the Board provides written notice of such failure to the
Executive and the failure continues for five (5) days after the Executive’s
receipt of such notice, or (v) Executive’s material breach of this Agreement,
including without limitation any breach of Sections 8 through 11 hereof,
provided that, in the case of any such breach, the Board provides written
notice of breach to the Executive, specifically identifying the manner in which
the Board believes that Executive has breached this Agreement, and Executive
shall have the opportunity to cure such breach to the reasonable satisfaction
of the Board within thirty (30) days following the delivery of such notice,
unless such breach is incapable of cure. For purpose of this paragraph, no act
or failure to act by Executive shall be considered “willful” if such act or
failure to act occurred at the direction of the Board.


 


(b)           Disability.
“Disability” shall mean that Executive has been unable to perform his duties as
an employee as the result of his incapacity due to physical or mental illness
for a continuous period of not less than one month or a cumulative period of
not less than eight weeks within any 12-month period, and such inability, at
least 26 weeks after its commencement, is determined to be total and permanent
by a physician selected by the Company’s insurers. Termination resulting from
Disability may only be effected after at least sixty (60) days written notice
by the Company informing Executive of its intention to terminate Executive’s
employment and the date upon which such termination shall occur. In the event
that Executive resumes the performance of substantially all of his duties
hereunder before the termination of his employment becomes effective, the
notice of intent to terminate automatically shall be deemed to have been
revoked.


 


(c)           Termination Date.
“Termination Date” shall mean (i) if this Agreement is terminated on
account of death, the date of death; (ii) if this Agreement is terminated for
Disability, the date specified in Section 7(b); (iii) if this Agreement is
terminated by the Company, the date on which such termination occurs as set
forth in a notice of termination given to Executive by the Company in
accordance with Sections 6(a) and 12(a); (iv) if the Agreement is terminated by
Executive, the date indicated in a notice of termination given to the Company
by Executive in accordance with Sections 6(a) and 12(a); or (v) if this
Agreement expires by its terms, then the last day of the term of this
Agreement.


 


(d)           Constructive
Termination. A “Constructive Termination” shall be deemed to occur
if Executive elects to voluntarily terminate employment within the ninety (90)
day period immediately following any of the following events: (i) Executive’s
position changes as a result of an action by the Company such that (A)
Executive shall no longer be Chief Operating Officer of the Company, (B)
Executive shall have duties and responsibilities demonstrably less than those
typically


 


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associated
with a Chief Operating Officer, or (C) Executive shall no longer report
directly to the Chief Executive Officer, (ii) Executive is required to relocate
his place of employment, other than a relocation within fifty (50) miles of the
Company’s Houston offices, (iii) there is a reduction in Executive’s Base
Salary or Target Bonus other than any such reduction consistent with a general
reduction of pay across the executive staff as a group, as an economic or
strategic measure due to poor financial performance by the Company or (iv)
there occurs any other material breach of this Agreement by the Company after a
written demand for substantial performance is delivered to the Company by
Executive which specifically identifies the manner in which Executive believes
that the Company has materially breached this Agreement, and the Company has
failed to cure such breach to the reasonable satisfaction of Executive within
thirty (30) days following the delivery of such notice.


 


(e)           Change in Control.
“Change in Control” shall have the same meaning as in the Company’s 2006
Equity Incentive Compensation Plan.


 


8.             Confidential
Information.


 


(a)           Executive acknowledges
that the Confidential Information relating to the business of the Company and
its subsidiaries which Executive has obtained or will obtain during the course
of his association with the Company and subsidiaries and his performance under
this Agreement are the property of the Company and its subsidiaries. Executive
agrees that Executive will not disclose or use at any time, either during or
after the Employment period, any Confidential Information without the written
consent of the Board of Directors of the Company, other than proper disclosure
or use in the performance of his duties hereunder. Executive agrees to deliver
to the Company at the end of the Employment Term, or at any other time that the
Company may request, all memoranda, notes, plans, records, documentation and
other materials (and copies thereof) containing Confidential Information
relating to the business of the Company and its subsidiaries, no matter where
such material is located and no matter what form the material may be in, which
Executive may then possess or have under his control. If requested by the
Company, Executive shall provide to the Company written confirmation that all
such materials have been delivered to the Company or have been destroyed.
Executive shall take all appropriate steps to safeguard Confidential
Information and to protect it against disclosure, misuse, espionage, loss and
theft.


 


(b)           “Confidential
Information” shall mean information which is not generally known to the
public and which is used, developed, or obtained by the Company or its
subsidiaries relating to the businesses of any of the Company and its
subsidiaries or the business of any customer thereof including, but not limited
to:  pricing models; products or
services; fees, costs and pricing 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 unpatentable and whether or not reduced to
practice; all copyrightable works; the customers of any of the Company and its
subsidiaries and the Confidential Information of any customer thereof; and all
similar and related information in whatever form. Confidential Information shall
not include any information which (i) was rightfully known by Executive prior
to the Employment Term; (ii) is publicly disclosed by law or in response to an
order of a court or governmental agency; (iii) becomes publicly available
through no fault of Executive or (iv) has been


 


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published
in a form generally available to the public prior to the date upon which
Executive proposes to disclose such information. Information shall not be
deemed to have been published merely because individual portions of the
information have been separately published, but only if all the material
features comprising such information have been published in combination.


 


9.             Intellectual
Property. In the event that Executive, as a part of Executive’s activities
on behalf of the Company, generates, authors or contributes to any invention,
new development or method, whether or not patentable and whether or not reduced
to practice, any copyrightable work, any trade secret, any other Confidential
Information, or any information that gives any of the Company and its
subsidiaries an advantage over any competitor, or similar or related
developments or information related to the present or future business of any of
the Company and its subsidiaries (collectively “Developments and Information”),
Executive acknowledges that all Developments and Information are “work for
hire” and the exclusive property of the Company. Executive hereby assigns to
the Company, its nominees, successors or assigns, all rights, title and
interest to Developments and Information. Executive shall cooperate with the
Company’s Board of Directors to protect the interests of the Company and its
subsidiaries in Developments and Information. Executive shall execute and file
any document related to any Developments and Information requested by the
Company’s Board of Directors including applications, powers of attorney,
assignments or other instruments which the Company’s Board of Directors deems
necessary to apply for any patent, copyright or other proprietary right in any
and all countries or to convey any right, title or interest therein to any of
the Company’s nominees, successors or assigns.


 


10.           No Conflicts.


 


(a)           Executive agrees that
in his individual capacity he will not enter into any agreement, arrangement or
understanding, whether written or oral, with any supplier, contractor,
distributor, wholesaler, sales representative, representative group or
customer, relating to the business of the Company or any of its subsidiaries,
without the express written consent of the Board.


 


(b)           As long as Executive is
employed by the Company or any of its subsidiaries, Executive agrees that
Executive will not, except with the express written consent of the Board,
become engaged in, render services for, or permit his name to be used in
connection with, any for-profit business other than the business of the
Company, any of its subsidiaries or any corporation or partnership in which the
Company or any of its subsidiaries have an equity interest.


 


11.           Non-Competition
Agreement.


 


(a)           Executive acknowledges
that Executive services are of a special, unique and extraordinary value to the
Company and that Executive has access to the Company’s trade secrets,
Confidential Information and strategic plans of the most valuable nature and
develops goodwill on behalf of the Company. Accordingly, Executive agrees that
during the Restricted Term (as defined below), Executive shall not directly or
indirectly own, manage, control, participate in, consult with, render
strategic, executive managerial sales, marketing, investment, financial, or
other non-administrative services for, or in any manner engage in any business
Competing (as defined below) with the businesses of the Company or any of its
subsidiaries as such businesses exist or are in process of development on the
Termination Date (as evidenced by written proposals, market


 


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research
or similar materials). A business is a Competing business if it engages in the
deregulated retail marketing of natural gas or electricity in markets in which
the Company has operated at any time during the two-year period ending on the
Termination Date, and shall not include any regulated businesses. Nothing
herein shall prohibit Executive from being a passive owner of not more than 3%
of the outstanding stock of any class of a corporation that is publicly traded,
so long as Executive has no active participation in the business of such
corporation. For purposes of this Agreement, the “Restricted Term” shall be the
remainder of the then current Employment Term.


 


(b)           In addition, during the
Restricted Term, Executive shall not (i) directly or indirectly induce or
attempt to induce any employee of the Company or any subsidiary (other than his
own assistant) to leave the employ of the Company or such subsidiary, or in any
way interfere with the relationship between the Company or any subsidiary and
any employee thereof, (ii) hire directly or through another entity any person
who was an employee of the Company or any subsidiary at any time during the
then preceding 12 months (unless such employee contacts the Executive on an
unsolicited bases), (iii) directly or indirectly induce or attempt to induce
any customer, supplier, licensee or other business relation of the Company or
any subsidiary to cease doing business with the Company or such subsidiary, or
in any way interfere with the relationship between any such customer, 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 of competent jurisdiction shall determine any of the foregoing
covenants to be unenforceable with respect to the term thereof or the scope of
the subject matter or geography covered thereby, such remaining covenants shall
nonetheless be enforceable by such court or tribunal against such other party
or parties or upon such shorter term or within such lesser scope as may be
determined by the court or tribunal to be enforceable.


 


(d)           Because Executive’s
services are unique and because Executive has access to Confidential
Information and strategic plans of the Company of the most valuable nature and
will help the Company develop goodwill, the parties agree that the covenants
contained in this Section 11 are necessary to protect the value of the business
of the Company and that a breach of any such covenant would result in
irreparable and continuing damage for which there would be no adequate remedy
at law. The parties agree therefore that in the event of a breach or threatened
breach of this Agreement, the Company or its successors or assigns may, in
addition to other rights and remedies existing in their favor, apply to any
court of competent jurisdiction for specific performance and/or injunctive or
other relief in order to enforce, or prevent any violations of, the provisions
hereof. The parties further agree that in the event the Company is granted any
such injunctive or other relief, the Company shall not be required to post any
bond or security that may otherwise normally be associated with such relief.


 


12.           Miscellaneous
Provisions.


 


(a)           Notice. Notices and all other
communications contemplated by this Agreement shall be in writing, shall be effective
when given, and in any event shall be deemed to have been duly given (i) when
delivered, if personally delivered, (ii) three (3) business days after 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 the business day of
deposit with Federal Express or similar overnight courier, if so


 


10

















 


delivered,
freight prepaid. In the case of Executive, notices shall be addressed to him at
the home address which he most recently communicated to the Company in writing.
In the case of the Company, notices shall be addressed to its corporate
headquarters, and all notices shall be directed to the attention of its
Corporate Secretary.


 


(b)           Notice of
Termination. Any termination by the Company or Executive shall be
communicated by a notice of termination to the other party hereto given in
accordance with paragraph (a) hereof. Such notice shall indicate the specific
termination provision in this Agreement relied upon.


 


(c)           Successors.


 


(i)            Company’s
Successors. Any successor to the Company (whether direct or indirect and
whether by purchase, lease, merger, consolidation, liquidation or otherwise) to
all or substantially all of the Company’s business and/or assets shall be
entitled to assume the rights and shall be obligated to assume the obligations
of the Company under this Agreement and shall agree to perform the Company’s
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession. For all purposes under this Agreement, the term “Company” shall
include any successor to the Company’s business and/or assets which executes
and delivers the assumption agreement described in this subsection (i) or which
becomes bound by the terms of this Agreement by operation of law.


 


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


 


(iii)          No Other Assignment
of Benefits. Except as provided in this Section 12(c), the rights of any person
to payments or benefits under this Agreement shall not be made subject to
option or assignment, either by voluntary or involuntary assignment or by
operation of law, including (without limitation) bankruptcy, garnishment,
attachment or other creditor’s process, and any action in violation of this
subsection (iii) shall be void.


 


(d)           Waiver. No
provision of this Agreement shall be modified, waived or discharged unless the
modification, waiver or discharge is agreed to in writing and signed by
Executive and by an authorized officer of the Company (other than Executive).
No waiver by either party of any breach of, or of compliance with, any
condition or provision of this Agreement by the other party shall be considered
a waiver of any other condition or provision or of the same condition or
provision at another time.


 


(e)           Entire Agreement.
This Agreement shall supersede any and all prior agreements, representations or
understandings (whether oral or written and whether express or implied) between
the parties with respect to the subject matter hereof.


 


11

















 


(f)            Severability.
The invalidity or unenforceability of any provision or provisions of this
Agreement shall not affect the validity or enforceability of any other
provision hereof, which shall remain in full force and effect.


 


(g)           Arbitration.
Except for injunctive or other equitable relief in aid of arbitration, any
dispute or controversy arising under or in connection with this Agreement shall
be settled exclusively by arbitration in Houston, Texas, in accordance with the
rules of the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator’s award in any court having jurisdiction. No party
shall be entitled to seek or be awarded punitive damages. All attorneys fees
and costs shall be allocated or apportioned as agreed by the parties or, in the
absence of an agreement, in such manner as the arbitrator or court shall
determine to be appropriate to reflect the final decision of the deciding body
as compared to the initial positions in arbitration of each party. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK AS THEY APPLY TO CONTRACTS
ENTERED INTO AND WHOLLY TO BE PERFORMED WITHIN SUCH STATE BY RESIDENTS THEREOF.


 


(h)           Withholding of Taxes.
All payments made pursuant to this Agreement will be subject to withholding of
applicable taxes.


 


(i)            Indemnification.
Executive will be covered under the Company’s insurance policies and, subject
to applicable law, will be provided indemnification to the maximum extent
permitted by the Company’s bylaws and Certificate of Incorporation, with such
insurance coverage and indemnification to be in accordance with the Company’s
standard practices for senior executive officers but on terms no less favorable
than provided to any other Company senior executive officer or director.
Indemnification shall not be awarded for any conduct that is found to be breach
by a Court or tribunal of competent jurisdiction to violate this agreement.


 


(j)            Compliance with
Company Policies. During the Employment Term, Executive will comply with
all Company policies generally applicable to the Company’s employees and senior
executives.


 


(k)           Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed
an original, but all of which together will constitute one and the same
instrument.


 


(l)            Non-Disclosure.
Unless required by law or to enforce this Agreement, the parties hereto shall
not disclose the existence of this Agreement or the underlying terms to any
third party, other than their representatives who have a need to know such
matters.


 


(m)          Legal Fees. The
Company shall pay the reasonable legal fees incurred by the Executive in
connection with the negotiation of this Agreement in an amount not to exceed
$20,000.


 


12

















 


IN WITNESS WHEREOF, each of the parties has executed
this Agreement, in the case of the Company by its duly authorized officer, as
of the day and year first above written.


 


 


	
   

  	
  MxENERGY INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Jeffrey A. Mayer

  	
   

  
	
   

  	
   

  	
   Name:  Jeffrey A. Mayer

  
	
   

  	
   

  	
   Title:  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Steven Murray

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Steven Murray