EXHIBIT
10.28


EMPLOYMENT
AGREEMENT


This Employment Agreement
(the “Agreement”) is entered into on August 14, 2006 (the “Effective
Date”) by and between Robert Werner, an individual (“Employee”), 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.


1.             Employment.  Employee shall serve as Vice President,
Supply, of the Company, will report to the Chief Operating Officer (“COO”)
and will render such services consistent with the foregoing role.  Employee’s office shall be located at the
Employee offices of the Company in Houston, Texas.


2.             Term.  Company’s employment of Employee pursuant to
this Agreement shall commence on the Effective Date and end on the Termination
Date (as defined below).  The Employee’s
employment shall be “at will” and either the Company or Employee may terminate
this agreement and Employee’s employment at any time, for any reason or no
reason, in its or his sole discretion, upon sixty (60) days’ prior written
notice of termination.  “Termination
Date” shall mean (i) if this Agreement is terminated on account of death,
the date of death; (ii) 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 Employee by the Company in accordance with Section 11(b); or (iii) if
the Agreement is terminated by Employee, the date indicated in a notice of
termination given to the Company by Employee in accordance with Section
11(b).  The period between the Effective
Date and the Termination Date is the Employment Term; subject, however,
to the provisions of Section 6(b) below.


3.             Salary.  The Company shall pay Employee base salary (“Base
Salary”) at an annual rate of $250,000. 
Employee’s Base Salary shall be paid in conformity with the Company’s
salary payment practices generally applicable to similarly situated Company
Employees.


4.             Bonus.  The Company shall pay Employee a bonus based
on Employee’s and the Company’s performance, such bonus to be determined and
paid annually in a manner consistent with the determination and payment of
bonuses paid to other executives of the Company.  Subject to the Company’s discretion, such
bonus is expected to range between 50 and 100% of Employee’s Base Salary for
satisfactory and outstanding performance, respectively.


5.             Employee
Benefits.


(a)           Stock Options.  On August 14, 2006, Employee shall be granted
a nonqualified stock option to purchase an aggregate of 50,000 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 Employee’s continued employment
with the Company on each vesting date. All unvested options shall be 


 





















 


automatically forfeited
upon the Employee’s termination of employment for any reason, regardless of any
contrary term in any past or future award agreement.  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.  In the event the Company
terminates the Employee’s employment for Business Reasons (as defined below),
the Employee shall forfeit all vested stock options.  In the event Employee’s employment terminates
for any other reason, all vested stock options will expire in accordance with
the terms of this Agreement and the applicable award agreement(s) to the extent
they are not inconsistent with this Agreement. 
The term “Business Reasons” means (i) gross negligence, willful
misconduct or other willful malfeasance by Employee in the performance of his
duties, (ii) Employee’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 Employee involving moral
turpitude, fraud or misrepresentation with respect to his duties for the
Company or its affiliates, (iv) any act by the Employee constituting a failure
to follow the directions of the either the Chief Executive Officer, the COO, or
the Board (or anyone else whom any of them may appoint to supervise the
Employee), provided that, the Board provides written notice of such failure to
the Employee and the failure continues for five (5) days after the Employee’s
receipt of such notice, or (v) Employee’s material breach of this Agreement,
including without limitation any breach of Sections 7 through 10 hereof,
provided that, in the case of any such breach, the Board provides written
notice of breach to the Employee, specifically identifying the manner in which
the Board believes that Employee has breached this Agreement, and Employee
shall have the opportunity to cure such breach (but only if it is reasonably
capable of being cured) 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 Employee shall be considered “willful”
if such act or failure to act occurred at the direction of the Board.


(b)           Repurchase of Common Stock.  In the event that the Employee’s employment
terminates for any reason, the Company shall have the right (but not the
obligation) to purchase all of the shares of Common Stock that the Employee
owns for their then fair market value as determined by the Company in its sole
discretion; provided that (i) if the total amount payable to the Employee for
such shares exceeds $200,000, the Company may pay the excess to the Employee in
quarterly installment payments, plus five percent (5%) simple interest on
unpaid balances, over a period of three years; and (ii) the Company’s
obligation to make any payment shall be suspended during any period for which
payment would cause the Company to violate a loan or similar financial covenant
(with such suspension only applying to the portion of the payment that would
cause violation of the loan or similar financial covenant).  The Company shall have the opportunity to
exercise this repurchase right only within the ninety (90) day period following
the Employee’s termination of employment and the repurchase right shall expire
immediately upon an initial public offering of the Company’s stock.  The repurchase price of the shares being
repurchased shall equal the fair market value as established through an
independent valuation, by a valuation firm selected by the Board.


(c)           Other Employee Benefits.  During the Employment Term, the Employee
shall be entitled to receive all benefits provided to employees of the Company
generally from time to time, including health, life insurance and disability,
and all other benefits provided to the Company’s 


 


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employees generally, in
each case so long as and to the extent the same exist; provided, that in
respect to each such plan Employee is otherwise eligible and insurable in
accordance with the terms of such plans.


(d)           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 they exist from time to
time.  PTO not used during any calendar
year will not roll over to the following year.


6.             Termination Pay.


(a)           Resignation or Termination for
Business Reasons.  If (i) Employee
voluntarily terminates his employment, other than as a result of a Constructive
Termination (as defined below), or (ii) the Company terminates Employee’s employment
for Business Reasons, then in any such event (A) all further vesting of
Employee’s stock options and other equity arrangements, if any, will cease
immediately and such awards will expire in accordance with the terms of this
Agreement and the applicable award agreement(s) to the extent they are not
inconsistent with this Agreement, (B) all payments of compensation by the
Company to Employee hereunder will terminate immediately, (C) Employee will be
paid all accrued but unpaid PTO, expense reimbursements and other benefits due
to Employee through his termination date under any Company-provided or paid
plans, policies, and arrangements, and (D) Employee will be paid all accrued
and unpaid salary.


(b)           Constructive Termination or
Termination without Business Reasons. 
If at any time during the Employment Term (i) Employee terminates his
employment as a result of a Constructive Termination, or (ii) the Company
terminates Employee’s employment without Business Reasons, then subject to
Employee signing and not revoking a general release of claims against the
Company and its successors, Employee shall be entitled to receive (A) a lump
sum payment equal to the Base Salary for the remainder of the Employment Term,
and (B) all other benefits under Sections 6(a)(C) and 6(a)(D) above.  For purposes of determining severance for the
remainder of the Employment Term under this Section 6(b), the parties agree
that the Employment Term shall be deemed to be three (3) years from the date of
this Agreement.


(c)           Constructive Termination.  For purposes of this Agreement, a “Constructive
Termination” shall be deemed to occur if the Employee elects to voluntarily
terminate employment within the ninety (90) day period immediately following
any of the following events: (i) Employee is required to relocate his place of
employment, other than a relocation within fifty (50) miles of the Company’s
Houston offices, (ii) there is an intentional reduction in  Employee’s Base Salary 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 (iii) 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 Employee which specifically
identifies the manner in which Employee believes that the Company has
materially breached this Agreement, and the Company has failed to cure such
breach to the reasonable satisfaction of Employee within thirty (30) days
following the delivery of such notice.


 


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7.             Confidential Information.


(a)           Employee acknowledges that the
Confidential Information relating to the business of the Company and its
subsidiaries which Employee 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.  Employee agrees that Employee 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.  Employee 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 Employee may then possess or have under his control.  If requested by the Company, Employee shall
provide to the Company written confirmation that all such materials have been
delivered to the Company or have been destroyed.  Employee 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 Employee 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 Employee or (iv) has been published in a form generally available to
the public prior to the date upon which Employee 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.


8.             Intellectual Property.  In the event that Employee, as a part of
Employee’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”), Employee acknowledges that all Developments and Information
are “work for hire” and the exclusive property of the Company.  Employee hereby assigns to the Company, its
nominees, successors or assigns, all rights, title and interest to 


 


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Developments and
Information.  Employee shall cooperate
with the Company’s Board of Directors to protect the interests of the Company
and its subsidiaries in Developments and Information.  Employee 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.


9.             No Conflicts.


(a)           Employee 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 Employee is employed by
the Company or any of its subsidiaries, Employee agrees that Employee 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.


10.           Non-Competition
Agreement.


(a)           Employee acknowledges that Employee’s
services are of a special, unique and extraordinary value to the Company and
that Employee 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, Employee agrees that during the Restricted Term (as defined
below), Employee shall not directly or indirectly own, manage, control,
participate in, consult with, render strategic, 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 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. 
Nothing herein shall prohibit Employee 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 Employee has no active participation in the
business of such corporation.  For
purposes of this Agreement, the “Restricted Term” shall run through the third
anniversary of the Effective Date.


(b)           In addition, during the Restricted
Term, Employee 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 


 


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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 Employee 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 Employee’s services are
unique and because Employee 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 10 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.


11.           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 delivered,
freight prepaid.  In the case of
Employee, 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 Employee
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.


 


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(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)           Employee’s Successors.  The terms of this Agreement and all rights of
Employee 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 of Benefits.  Except as provided in this Section 11(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 Employee and by an authorized officer of the
Company (other than Employee).  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.


(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 


 


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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.  Employee 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 employees in
similar positions.  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, Employee will
comply with all Company policies generally applicable to the Company’s
employees.


(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 Employee in connection with the negotiation of this
Agreement in an amount not to exceed $1,500.


 


 


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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 Mayer

  
	
   

  	
   

  	
  Name: Jeffrey Mayer

  
	
   

  	
   

  	
  Title: President and CEO

  
	
   

  	
   

  	
   

  
	
   

  	
  EMPLOYEE

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Werner

  
	
   

  	
   

  	
  Robert Werner