Document:

EX-10.4

 

Exhibit 10.4

AMENDED AND RESTATED SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

          This Amended and Restated Senior Executive Employment Agreement (the “Agreement”) is
entered into as of this 8th day of August, 2007 (the “Effective Date”) by and between Eric
D. Jacobs (“Executive”) and DealerTrack Holdings, Inc, a Delaware corporation
(“Employer”) with principal offices at 1111 Marcus Avenue, Suite M04, Lake Success, NY
11042.

          WHEREAS, Executive and Employer are parties to a senior executive employment agreement, dated
as of May 26, 2005 (the “Existing Employment Agreement”); and

          WHEREAS,
the parties hereto wish to amend and restate the Existing Employment Agreement
pursuant to this Agreement;

          NOW, THEREFORE, in consideration of the promises and the agreements hereinafter set forth, the
parties hereto hereby agree that, upon the effectiveness of this Agreement, the Existing Employment
Agreement is hereby amended and restated in its entirety as follows:

          Section 1. Term

          Employer shall continue to employ Executive and Executive agrees to continue such employment,
upon the terms and conditions hereinafter set forth, from the Effective Date through and including
August 8, 2008 (the “Initial Term”). This Agreement shall renew automatically for
successive one year periods (each, a “Renewal Term”) unless one party gives notice to the
other party, in writing, at least sixty (60) days prior to the expiration of this Agreement (or any
renewal) of its desire to terminate the Agreement. The term of this Agreement, including the
Initial Term and any Renewal Term, shall be referred to herein as the “Term”.

          Section 2. Executive’s Duties

          (a) Executive shall be Senior Vice President, General Counsel and Secretary and shall report
directly to Employer’s Chief Executive Officer or his designee. Executive shall faithfully and
diligently perform his duties at the direction of Employer’s Chief Executive Officer, or his
designee, to the best of Executive’s ability. Executive shall (i) devote his best efforts, skill,
and ability and full business time and attention to the performance of the services customarily
incident to such office, subject to vacations and sick leave as provided herein and in accordance
with Employer policy, (ii) carry out his duties in a competent and professional manner; and (iii)
generally promote the interests of Employer. Subject to applicable law, Executive shall not
knowingly participate in any activity that is detrimental to the interests of Employer or any of
its affiliates, including, without limitation, any public criticism or disparagement of any type by
Executive, through the media or otherwise, of Employer or any of its affiliates or employees,
except in connection with the exercise of Executive’s rights against Employer or any of its
affiliates.

 

          (b) Executive agrees to abide by all policies applicable to senior executive officers of
Employer promulgated from time to time by Employer, which policies are enforced uniformly and
applicable to all similar executives of Employer.

          (c) Except for such business travel as may be incident to his duties hereunder, Executive
shall perform his duties at Employer’s offices at the address set forth in the preamble to this
Agreement or at such other location as may be approved by Employer.

          Section 3. Compensation for Executive’s Services

          In consideration of the duties and services to be performed by Executive pursuant to Sections
1 and 2 hereof, Executive shall receive:

          (a) Salary. Executive shall earn salary (the “Salary”) at the annual rate of
Two Hundred Seventy Thousand Dollars ($270,000) (the “Minimum Salary”), less all applicable
federal, state, and local tax withholdings. Such Salary shall be earned and shall be payable in
periodic installments in accordance with Employer’s payroll practices. During the Term, the Board
of Directors of Employer (the “Board”) or the Compensation Committee of the Board (the
“Compensation Committee”) will review the Salary annually and may in its discretion
increase the Salary, but may not reduce it during the Term unless Employer institutes salary
reductions across the board; provided, however, that in no event shall the Salary be reduced below
the Minimum Salary without Executive’s written consent.

          (b) Bonus. For each fiscal year of Employer (each, a “Fiscal Year”),
Executive shall be entitled to receive a cash performance bonus (a “Bonus”) which shall be
based on the achievement of certain performance benchmarks by Employer during such Fiscal Year
which shall be determined by the Board. The Board shall review the target Bonus on an annual basis
and, in its sole discretion, may increase such target Bonus for any Fiscal Year. The target Bonus
shall not be decreased except in connection with company-wide bonus reductions. The target Bonus
for any Fiscal Year shall be at least fifty five (55%) percent of the Salary for such Fiscal Year.
The Bonus for each Fiscal Year shall be paid, if at all, to Executive on a schedule consistent with
Employer’s bonus payments to its other similarly situated senior executive officers by no later
than two and one half (21/2) months following the end of such Fiscal Year. Executive understands and
agrees that the Bonus is established in part as an inducement for Executive to remain employed by
Employer and except as provided in Section 5(c) of this Agreement, or in the Employer’s sole
discretion, in the event that Executive’s employment is terminated prior to the end of any Fiscal
Year during the Term, then Executive shall not receive payment of any Bonus for such year.

          (c) Equity. In connection with Executive’s employment, Executive has been and may
continue to be granted stock options (“Stock Options”) to purchase equity securities of
Employer pursuant to the terms of DealerTrack Holdings, Inc. 2001 Stock Option Plan, effective as
of August 10, 2001, as amended (“Stock Option Plan”) or may be granted Stock Options or
other equity based awards pursuant to the terms of the DealerTrack Holdings, Inc. 2005 Incentive
Award Plan, effective as of May 26, 2005, as amended (the “2005 Incentive Award Plan”), or
any other successor equity incentive plans (collectively, the “Stock Incentive Plans”).
Except as otherwise provided herein, the terms of the Stock Options shall be governed by the

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Stock Incentive Plans. Executive shall be credited with twenty-four (24) months accelerated
vesting of his Stock Options upon termination of Executive’s employment by: (1) Employer without
Cause (as defined below); or (2) Executive for Good Reason (as defined below). Executive shall be
credited with thirty-six (36) months accelerated vesting of his Stock Options upon a Change of
Control (defined below). Executive shall be credited with full acceleration and vesting of his
Stock Options upon the earlier of: (1) the elimination of Executive’s position or a termination of
Executive’s employment, in either event, within twelve (12) months after a Change of Control; (2) a
material negative change in Executive’s compensation or responsibilities within twelve (12) months
after a Change of Control; or (3) the requirement that Executive be based at a location which is
more than fifty (50) miles from Employer’s offices at the address set forth in the preamble to this
Agreement within twelve (12) months after a Change of Control. Anything in the Stock Incentive
Plans to the contrary notwithstanding, if Executive’s employment is terminated by Executive with
Good Reason or by Employer without Cause, or under circumstances described above which would result
in certain accelerated vesting of any unvested Stock Options held by Executive, the unexercised
portion of any Stock Options held by Executive will not terminate until the twelve (12) month
anniversary of the date of termination of Executive’s employment. In the event Employer elects to
grant equity based awards other than Options, such grants shall, where appropriate, be subject to
equivalent acceleration provisions as set forth in this Section 3(c). For purposes hereof, a
“Change of Control” shall mean and includes each of the following:

     (i) A transaction or series of transactions (other than an offering of shares of
Employer to the general public through a registration statement filed with the Securities
and Exchange Commission) whereby any “person” or related “group” of “persons” (as such terms
are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended)
(other than the Employer, any of its subsidiaries, an employee benefit plan maintained by
the Employer or any of its subsidiaries or a “person” that, prior to such transaction,
directly or indirectly controls, is controlled by, or is under common control with, the
Employer) directly or indirectly acquires beneficial ownership (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended) of securities of the Employer
possessing more than 50% of the total combined voting power of the Employer’s securities
outstanding immediately after such acquisition; or

     (ii) During any period of two consecutive years, individuals who, at the beginning of
such period, constitute the Board together with any new director(s) (other than a director
designated by a person who shall have entered into an agreement with the Company to effect a
transaction described in Section 3(c)(i) or Section 3(c)(iii)) whose election by the Board
or nomination for election by the Employer’s stockholders was approved by a vote of at least
two-thirds of the directors then still in office who either were directors at the beginning
of the two-year period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof; or

     (iii) The consummation by the Employer (whether directly involving the Employer or
indirectly involving the Employer through one or more intermediaries) of (x) a merger,
consolidation, reorganization, or business combination or (y) a sale or other disposition of
all or substantially all of the Employer’s assets in any single transaction or

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series of related transactions or (z) the acquisition of assets or stock of another
entity, in each case other than a transaction:

     (A) Which results in the Employer’s voting securities outstanding immediately
before the transaction continuing to represent (either by remaining outstanding or
by being converted into voting securities of the Employer or the person that, as a
result of the transaction, controls, directly or indirectly, the Employer or owns,
directly or indirectly, all or substantially all of the Employer’s assets or
otherwise succeeds to the business of the Employer (the Employer or such person, the
“Successor Entity”)) directly or indirectly, at least a majority of the
combined voting power of the Successor Entity’s outstanding voting securities
immediately after the transaction, and

     (B) After which no person or group beneficially owns voting securities
representing 50% or more of the combined voting power of the Successor Entity;
provided, however, that no person or group shall be treated for purposes of this
Section 3(c)(iii) as beneficially owning 50% or more of combined voting power of the
Successor Entity solely as a result of the voting power held in the Employer prior
to the consummation of the transaction; or

     (iv) The Employer’s stockholders approve a liquidation or dissolution of the Employer.

The Board or its designee shall have full and final authority, which shall be exercised in its
discretion, to determine conclusively whether a Change of Control of the Employer has occurred, and
the date of the occurrence of such Change of Control and any incidental matters relating thereto.

          (d) Benefits. Employer shall provide Executive with the right to participate in and
receive benefits from all life, accident, disability, medical and pension plans, and all similar
benefits as are from time to time in effect and are generally made available to similar situated
senior executive officers of Employer. The amount and extent of benefits to which Executive is
entitled shall be governed by the specific benefit plan, as it may be amended from time to time.

          (e) Expenses. Employer shall promptly reimburse Executive for reasonable expenses for
cellular telephone usage, entertainment, travel, meals, lodging and similar items incurred in the
conduct of Employer’s business. Such expenses shall be reimbursed in accordance with Employer’s
expense reimbursement policies and guidelines.

          (f) Vacation; Sick Leave. During the Term, Executive shall be entitled to four weeks
(4) weeks vacation per year, paid holidays, sick leave, and similar benefits, to be earned and used
in accordance with Employer’s policy and procedure for other similarly situated senior executive
officers.

          (g) Modification. Employer reserves the right to modify, suspend or discontinue any
and all of the above plans, practices, policies and programs referenced in Sections 3(d) and (e) at
any time in its discretion without recourse by Executive so long as such action is taken generally
with respect to other similarly situated senior executive officers. Any

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such modification, suspension or discontinuance of the plans, practices and policies
referenced in Section 3(e) will not apply to otherwise reimbursable expenses incurred by Executive
prior to any such modification, suspension or discontinuance.

          Section 4. Termination of Employment

          (a) Resignation. Executive may voluntarily terminate his employment with Employer, at
any time, with or without Good Reason, upon written notice to Employer.

          (b) Termination. Employer may terminate Executive’s employment at any time, with or
without Cause, upon written notice to Executive.

          (c) Death or Disability. Executive’s employment shall terminate immediately upon
Executive’s death. In the event Employer, in good faith, determines that Executive is unable to
perform the functions of his position due to a Disability (as defined below), it may notify
Executive in writing of its intention to terminate Executive’s employment and Executive’s
employment with Employer shall terminate effective on the thirtieth (30th) day after receipt of
such notice by Executive. For the purposes of this Agreement, “Disability” shall mean a
physical or mental impairment that substantially limits a major life activity of Executive and
renders Executive unable to perform the essential functions of his position even with reasonable
accommodation (that does not impose an undue hardship on Employer), and which has lasted at least
(i) sixty (60) consecutive days, (ii) the balance of Executive’s entitlement to leave, if any,
under the Family and Medical Leave Act, or other similar statute or (iii) the balance of any
election period under the Employer’s long term disability program (without regard to whether
Executive is awarded benefits under such program), whichever is longer.

          (d) Cause. Employer may immediately terminate Executive’s employment for
“Cause” by giving written notice to Executive. For purposes of this Agreement,
“Cause” shall mean:

	 	(1)	 	Executive’s commission of an act of fraud or
embezzlement upon Employer or any of its affiliates; or

	 	(2)	 	Executive’s commission of any willful act
intended to injure the reputation, business, or any business
relationship of Employer or any of its affiliates; or

	 	(3)	 	Executive is found by a court of competent
jurisdiction to have committed a felony; or

	 	(4)	 	the refusal or failure of Executive to perform
Executive’s duties with Employer in a competent and professional manner
that is not cured by Executive within ten (10) business days after a
written demand therefor is delivered to Executive by the Board which
specifically identifies the manner in which the Board believes that
Executive has not substantially performed Executive’s duties; provided,
further, however, that if the Board, in good faith, determines that the
refusal or failure by Executive is egregious in

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	 	 	 	nature or is not susceptible of cure, then no cure period shall be
required hereunder; or

	 	(5)	 	the refusal or failure of Executive to comply
with any of his material obligations under this Agreement (including
any exhibit hereto) that is not cured by Executive within ten (10)
business days after a written demand therefor is delivered to Executive
by the Board which specifically identifies the manner in which the
Board believes Executive has materially breached this Agreement;
provided, further, however, that if the Board, in good faith,
determines that the refusal or failure by Executive is egregious in
nature or is not susceptible of cure, then no cure period shall be
required hereunder.

          (e) Good Reason. Executive may terminate his employment for “Good Reason,” by
delivering written notice of such termination (“Employer Default Notice”) to Employer
within sixty (60) days of the occurrence of any of the following events, each of which shall
constitute Good Reason: (i) Employer’s material breach of any provision of this Agreement, the
Stock Incentive Plans or any agreements thereunder, which has not been cured within the allotted
time; (ii) a material reduction of Executive’s then current title, status, authority,
responsibility or duties or the assignment to Executive of any duties materially inconsistent with
Executive’s then current position; (iii) any material reduction in Executive’s salary or benefits;
(iv) the failure of any successor entity to assume the terms of this Agreement upon any Change of
Control; (v) the relocation of Executive to a facility or location more than fifty (50) miles from
Employer’s principal offices at the address set forth in the preamble to this Agreement; or (vi)
the failure of Employer to renew this Agreement upon the expiration of the Initial Term or any
Renewal Term. The Employer Default Notice shall specify the reason for Executive’s belief that an
event constituting Good Reason has occurred. Notwithstanding the foregoing, any material breach of
this Agreement by Employer, or other event constituting Good Reason, shall not constitute Good
Reason if any such breach or other event is cured or corrected by Employer within thirty (30) days
following delivery to Employer of the Employer Default Notice.

          (f) Continuing Obligations. Executive acknowledges and agrees that any termination
under this Section 4 is not intended, and shall not be deemed or construed, to affect in any way
any of Executive’s covenants and obligations contained in Sections 6, 7, and 8 hereof, which shall
continue in full force and effect beyond such termination for any reason.

          Section 5. Termination Obligations

          (a) Resignation. If Executive’s employment is terminated voluntarily by Executive
without Good Reason, Executive’s employment shall terminate without further obligations to
Executive other than for payment of the sum of any unpaid Salary determined by the Board and
reimbursable expenses and vacation accrued and owing to Executive prior to the termination. The
sum of such amounts shall hereinafter be referred to as the “Accrued Obligations,” which
shall be paid to Executive or Executive’s estate or beneficiary within thirty (30) days of the date
of termination. If Executive voluntarily terminates his employment without

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Good Reason and within (30) days of such termination, Employer determines that it would have
had Cause to terminate Executive pursuant to Section 4(d), Executive shall be deemed to have been
terminated for Cause and the terms of Section 5(b) shall apply.

          (b) Cause. If Executive’s employment is terminated by Employer for Cause, this
Agreement shall terminate without further obligations to Executive other than for the timely
payment of Accrued Obligations. If it is subsequently determined by an arbitrator, pursuant to
Section 19 hereof, that Employer did not have Cause for termination, then Employer’s decision to
terminate shall be deemed to have been made without Cause and the terms of Section 5(c) shall
apply.

          (c) By Employer Other than for Cause; Death or Disability; By Executive for Good
Reason.

                    (1) If (A) Employer terminates Executive’s employment for (x) a reason other than Cause, or
(y) due to Executive’s death or Disability, or (B) Executive terminates his employment for Good
Reason, Employer shall have no further obligations to Executive other than for (i) the payment of
Accrued Obligations, (ii) severance pay in an amount equal to twelve (12) months of Salary and
payable within thirty (30) days of the Severance Commencement Date; provided, however, that in the
event that Executive’s termination of employment is within twelve (12) months after a Change of
Control, such severance pay shall be increased to an amount equal to twenty four (24) months of
Salary, (iii) a pro rata bonus calculated based on multiplying the percentage of the year Executive
worked for Employer during the year of his termination by Executive’s target Bonus for such year
and payable within thirty (30) days of the Severance Commencement Date, and (iv) the reimbursement
of premiums otherwise payable by Executive pursuant to COBRA for a period of up to 12 months, or
until Executive no longer is eligible for COBRA continuation coverage, whichever is earlier. For
purposes of this Section 5, “Severance Commencement Date” shall mean (x) if any stock of
Employer or its affiliates is publicly traded on an established securities market or otherwise and
the Board (or its delegate) determines that as of the date of termination of Executive’s employment
that the Executive is a “key employee” (within the meaning of Section 416(i) of the Internal
Revenue Code of 1986, as amended (the “Code”), as interpreted in accordance with Section
409A of the Code and Department of Treasury regulations and other interpretive guidance issued
thereunder) and that Section 409A of the Code applies with respect to payments to Executive
pursuant to Section 5(c)(1)(ii) and (iii), the six-month anniversary of the date of the Executive’s
“separation from service” (within the meaning of section 409A of the Code); or (y) if the Board (or
its delegate) determines that Executive is not such a “key employee” as of date of Executive’s
termination of employment (or that Section 409A of the Internal Revenue Code does not apply with
respect to payments to the Executive pursuant to Section 5(c)(1)(ii) and (iii)), the date of
Executive’s termination of employment. The payments described in this Section 5(c)(1)(i) shall be
made within thirty (30) days of the date of Executive’s termination of employment.

                    (2) If Executive terminates his employment for Good Reason and it is subsequently determined
by an arbitrator, pursuant to Section 20 hereof, that Executive did not have Good Reason for
termination, then Executive’s decision to terminate for Good Reason shall be deemed to have been a
voluntary resignation, the terms of Section 5(a) shall apply, and all

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monies paid to Executive pursuant to this Section 5(c)(1), except for those monies paid
pursuant to Section 5(c)(1)(i), shall be immediately returned to Employer.

                    (3) The amounts payable pursuant to Section 5(c)(1) shall be the only amounts Executive shall
receive for termination in accordance with this Section 5(c); provided, however, that no amounts
shall be payable pursuant to this section 5(c) on or following the date Executive breaches any of
Sections 7, 8 or 9 of this Agreement.

          (d) Release. Notwithstanding anything to the contrary contained herein, no severance
payments required hereunder shall be made by Employer until such time as Executive shall execute a
general release for the benefit of Employer and its affiliates in a form satisfactory to Employer.
Such general release shall not apply to (i) Executive’s rights under any Stock Incentive Plan award
agreements or (ii) Executive’s rights, as applicable, to indemnification under Employer’s charter
or bylaws, any indemnification agreement or applicable law.

          (e) Equity Compensation Awards. Except as expressly provided herein, except for the
provisions of Section 3(c) of this Agreement, the terms of the Stock Incentive Plans and any
related award agreements and/or notice of grant shall govern the termination, vesting, and/or
exercise of Executive’s stock options or other equity awards upon the termination of Executive’s
employment for any reason.

          (f) Exclusive Remedy. Executive agrees that the payments set forth in this Agreement
shall constitute the exclusive and sole remedy for any termination of Executive’s employment and
Executive covenants not to assert or pursue any other remedies, at law or in equity, with respect
to this Agreement.

          (g) Termination of Executive’s Office. Following the termination of Executive’s
employment for any reason, Executive shall hold no further office or position with Employer or any
of its affiliates.

          Section 6. Parachute Payments.

          (a) If it is determined by a nationally recognized United States public accounting firm
selected by the Employer and approved in writing by the Executive (which approval shall not be
unreasonably withheld) (the “Auditors”) that any payment or benefit made or provided to the
Executive in connection with this Agreement or otherwise (including without limitation any Stock
Option or other equity based award vesting) (collectively, a “Payment”), would be subject
to the excise tax imposed by Section 4999 of the Code (the “Parachute Tax”), then the
Employer shall pay to the Executive, prior to the time the Parachute Tax is payable with respect to
such Payment, an additional payment (a “Gross-Up Payment”) in an amount such that, after
payment by the Executive of all taxes (including any Parachute Tax) imposed upon the Gross-Up
Payment, the Executive retains an amount of the Gross-Up Payment equal to the Parachute Tax imposed
upon the Payment. The amount of any Gross-Up Payment shall be determined by the Auditors, subject
to adjustment, as necessary, as a result of any Internal Revenue Service position. For purposes of
making the calculations required by this Agreement, the Auditors may make reasonable assumptions
and approximations concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of Sections

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280G and 4999 of the Code, provided that the Auditors’ determinations must be made with
substantial authority (within the meaning of Section 6662 of the Code).

          (b) The federal tax returns filed by the Executive (and any filing made by a consolidated tax
group which includes the Employer) shall be prepared and filed on a basis consistent with the
determination of the Auditors with respect to the Parachute Tax payable by the Executive. The
Executive shall make proper payment of the amount of any Parachute Tax, and at the request of the
Employer, provide to the Employer true and correct copies (with any amendments) of his federal
income tax return as filed with the Internal Revenue Service, and such other documents reasonably
requested by the Employer, evidencing such payment. If, after the Employer’s payment to the
Executive of the Gross-Up Payment, the Auditors determine in good faith that the amount of the
Gross-Up Payment should be reduced or increased, or such determination is made by the Internal
Revenue Service, then within ten (10) business days of such determination, the Executive shall pay
to the Employer the amount of any such reduction, or the Employer shall pay to the Executive the
amount of any such increase; provided, however, that in no event shall the Executive have
any such refund obligation if it is determined by the Employer that to do so would be a violation
of the Sarbanes-Oxley Act of 2002, as it may be amended from time to time; and provided, further,
that if the Executive has prior thereto paid such amounts to the Internal Revenue Service, such
refund shall be due only to the extent that a refund of such amount is received by the Executive;
and provided, further, that (i) the fees and expenses of the Auditors (and any other legal and
accounting fees) incurred for services rendered in connection with the Auditor’s determination of
the Parachute Tax or any challenge by the Internal Revenue Service or other taxing authority
relating to such determination shall be paid by the Employer and (ii) the Employer shall indemnify
and hold the Executive harmless on an after-tax basis for any interest and penalties imposed upon
the Executive to the extent that such interest and penalties are related to the Auditor’s
determination of the Parachute Tax or the Gross-Up Payment. Notwithstanding anything to the
contrary herein, the Executive’s rights under this Section 6 shall survive the termination of his
employment for any reason and the termination or expiration of this Agreement for any reason.

          Section 7. Restrictions Respecting Confidential Information

          Executive hereby covenants and agrees that, during his employment and thereafter, Executive
will not, under any circumstance, disclose in any way any Confidential Information (as defined
below) to any other person other than (i) at the direction of and for the benefit of Employer, (ii)
to his attorney or other advisers in connection with Executive’s enforcement of his rights
hereunder, provided such individuals or entities agree to be bound by the confidentiality
restrictions herein contained, and if such Confidential Information is relevant to such enforcement
action, to the court or arbitrator, as applicable, subject to a protective order. For the purposes
of the foregoing, “Confidential Information” means any information pertaining to the
assets, business, creditors, vendors, manufacturers, customers, data, employees, financial
condition or affairs, formulae, licenses, methods, operations, procedures, reports, suppliers,
systems and technologies of Employer and its affiliates, including (without limitation) the
contracts, patents, trade secrets and customer lists developed or otherwise acquired by Employer
and its affiliates; provided, however, that Confidential Information shall exclude any information
that was, is, or becomes publicly available other than through disclosure by Executive or any other
person known to Executive to be subject to confidentiality obligations to Employer. All

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Confidential Information is and will remain the sole and exclusive property of Employer and
its affiliates. Following the termination of his employment, Executive shall return all documents
and other tangible items containing Confidential Information to Employer, without retaining any
copies, notes or excerpts thereof.

          Section 8. Proprietary Matters

          Executive expressly understands and agrees that any and all improvements, inventions,
discoveries, processes, or know-how that are generated or conceived by Executive during the Term
(collectively, the “Inventions”) will be the sole and exclusive property of Employer, and
Executive will, whenever requested to do so by Employer (either during the Term or thereafter),
execute and assign any and all applications, assignments and/or other instruments and do all things
which Employer may deem necessary or appropriate in order to apply for, obtain, maintain, enforce
and defend patents, copyrights, trade names or trademarks of the United States or of foreign
countries for said Inventions, or in order to assign and convey or otherwise make available to
Employer the sole and exclusive right, title, and interest in and to said Inventions, applications,
patents, copyrights, trade names or trademarks; provided, however, that the provisions of this
Section 8 shall not apply to an Invention that Executive developed entirely on his own time without
using Employer’s Confidential Information except for those Inventions that either (i) directly and
materially relate, at the time of conception or reduction to practice of the invention, to
Employer’s business, or actual or demonstrably anticipated research or development of Employer, or
(ii) directly and materially result from any work performed by Executive for Employer. Executive
shall promptly communicate and disclose to Employer all Inventions conceived, developed or made by
him during his employment by Employer, whether solely or jointly with others, and whether or not
patentable or copyrightable, (a) which relate to any matters or business of the type carried on or
being developed by Employer, or (b) which result from or are suggested by any work done by him in
the course of his employment by Employer. Executive shall also promptly communicate and disclose
to Employer all material other data obtained by him concerning the business or affairs of Employer
in the course of his employment by Employer.

          Section 9. Nonsolicitation/Non-Compete

          (a) Executive agrees that throughout his employment and for a period of two (2) years
following the termination of his employment for any reason, he will not directly or indirectly,
own, manage, operate, control, or participate in the ownership, management, operation, or control
of, or be connected with, or have any financial interest in, any Competitor. Ownership, for
personal investment purposes only, of not to exceed (i) individually, two (2%) percent of the
outstanding capital stock of any privately held entity, or (ii) voting stock of any publicly held
corporation shall not constitute a violation hereof. For purposes of this Agreement, the term
“Competitor” shall mean any individual or entity, present or future, then providing any of
the following products or services: (1) a multi-finance source automotive finance portal, (2)
electronic contracting for automotive finance or lease transactions, other than at a financing
source entity that purchases electronic contracts or leases from automotive dealers, (3) automotive
lease, retail and/or balloon payment comparison or desking tools, (4) dealer management systems
(DMS), (5) any other sales or finance and insurance-related products or services for automotive
dealerships similar to any products or services offered by Employer or

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any of its affiliates, or (6) any other products or services similar to any products or
services offered by Employer or any of its affiliates and which product or service category
accounts for at least 15% of the consolidated revenues for the last fiscal quarter of Employer.

          (b) Executive agrees that during his employment with Employer and for a period of two (2)
years following the termination of his employment for any reason, he will not actively solicit for
employment, consulting or any other arrangement any employee of Employer or any of its present or
future affiliates (while an affiliate).

          (c) Executive agrees that during his employment with Employer and for a period of two (2)
years following the termination of his employment for any reason, he will not influence or attempt
to influence customers of Employer or any of its present or future affiliates, either directly or
indirectly, to divert their business to any Competitor.

          (d) The restrictions contained in this Section 9 are necessary for the protection of the
business and goodwill of Employer and are considered by Executive to be reasonable for such
purpose. Further, Executive represents that these restrictions will not prevent him from earning a
livelihood during the restricted period.

          (e) This Section 9 shall survive the termination or expiration of this Agreement.

          Section 10. Equitable Relief

          Executive acknowledges and agrees that Employer will suffer irreparable damage which cannot be
adequately compensated by money damages in the event of a breach, or threatened breach, of any of
the terms and provisions of Sections 7, 8 and 9 of this Agreement, and that, in the event of any
such breach, or threatened breach, Employer will not have an adequate remedy at law. It is
therefore agreed that Employer, in addition to all other such rights, powers, privileges and
remedies that it may have, shall be entitled to injunctive relief, specific performance or such
other equitable relief as Employer may request to enforce any of those terms and provisions and to
enjoin or otherwise restrain any act prohibited thereby, and Executive will not raise and hereby
waives any objection or defense that there is an adequate remedy available at law. Notwithstanding
the provisions of Section 20 of this Agreement, Executive agrees that Employer shall be entitled to
seek such injunctive relief, without bond, in a court of competent jurisdiction and Executive
hereby consents to the jurisdiction of the state and federal courts of New York for purposes of
such an action. Executive agrees that any claim he may have against Employer or any of its
affiliates shall not constitute a defense against the issuance of any such equitable relief. The
foregoing shall not constitute a waiver of any of Employer’s rights, powers, privileges and
remedies against or in respect of a breaching party or any other person or thing under this
Agreement, or applicable law.

          Section 11. Notice

          Any notice, request, demand or other communication hereunder shall be in writing, shall be
delivered by hand or sent by registered or certified mail or by reputable overnight delivery
service, postage prepaid, to the addressee at the address set forth below (or at

11

 

such other address as shall be designated hereunder by written notice to the other party
hereto) and shall be deemed conclusively to have been given when actually received by the
addressee.

          All notices and other communications hereunder shall be addressed as follows:

If to Executive at the address set forth in the Employer’s

payroll records.

If to Employer:

DealerTrack Holdings, Inc.

1111 Marcus Avenue, Suite M04

Lake Success, NY 11042

With a copy to:

General Counsel

DealerTrack Holdings, Inc.

1111 Marcus Avenue, Suite M04

Lake Success, NY 11042

or to such other address as either party shall have furnished to the other in writing in accordance
herewith.

          Section 12. Legal Counsel

          In entering into this Agreement, the parties represent that they have relied upon the advice
of their attorneys, who are attorneys of their own choice, and that the terms of this Agreement
have been completely read and explained to them by their attorneys, and that those terms are fully
understood and voluntarily accepted by them.

          Section 13. Section and Other Headings

          The section and other headings contained in this Agreement are for reference purposes only and
shall not affect the meaning or interpretation of this Agreement.

          Section 14. Governing Law

          This Agreement has been executed and delivered, and shall be governed by and construed in
accordance with the applicable laws pertaining, in the State of New York, without regard to
conflicts of laws principles.

          Section 15. Severability

          In the event that any term or provision of this Agreement shall be finally determined to be
superseded, invalid, illegal or otherwise unenforceable pursuant to applicable law by a
governmental authority having jurisdiction and venue, that determination shall not impair or
otherwise affect the validity, legality or enforceability, to the maximum extent

12

 

permissible by law, (a) by or before that authority of the remaining terms and provisions of
this Agreement, which shall be enforced as if the unenforceable term or provision were deleted, or
(b) by or before any other authority of any of the terms and provisions of this Agreement.

          Section 16. Counterparts

          Section 17. This Agreement may be executed in two counterpart copies of the entire document or
of signature pages to the document, each of which may be executed by one of the parties hereto, but
all of which, when taken together, shall constitute a single agreement binding upon both of the
parties hereto.

          Section 18. Benefit

          This Agreement shall be binding upon and inure to the benefit of the respective parties hereto
and their legal representatives, successors and assigns. Insofar as Executive is concerned, this
Agreement, being personal, cannot be assigned; provided, however, that should Executive become
entitled to payment pursuant to Section 5 hereof, he may assign his rights to such payment to his
legal representatives, successors, and assigns. Without limiting the generality of the foregoing,
all representations, warranties, covenants and other agreements made by or on behalf of Executive
in this Agreement shall inure to the benefit of the successors and assigns of Employer.

          Section 19. Modification

          This Agreement may not be amended or modified other than by a written agreement executed by
all parties hereto.

          Section 20. Entire Agreement

          Except as provided in Section 5(e) hereof, this Agreement contains the entire agreement of the
parties and supersedes all other representations, warranties, agreements and understandings, oral
or otherwise, among the parties with respect to the matters contained herein, including any prior
employment agreements between Executive and Employer or any affiliate of Employer.

          Section 21. Arbitration

          (a) Executive agrees that any dispute or controversy arising out of, relating to, or in
connection with this Agreement or the termination thereof, or the interpretation, validity,
construction, performance, breach, or termination thereof, shall be settled by expedited, binding
arbitration to be held in New York, New York in accordance with the National Rules for the
Resolution of Employment Disputes then in effect of the American Arbitration Association (the
“Rules”). The arbitrator may grant injunctions or other relief in such dispute or
controversy. The decision of the arbitrator shall be final, conclusive and binding on the parties
to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having
jurisdiction. The arbitrator may award the prevailing party its reasonable attorney’s fees.

13

 

          (b) The arbitrator shall apply New York law to the merits of any dispute or claim, without
reference to rules of conflicts of law. The arbitration proceedings shall be governed by federal
arbitration law and by the Rules, without reference to state arbitration law.

          (c) EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES ARBITRATION. EXECUTIVE
UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE IS AGREEING TO SUBMIT ANY CLAIMS ARISING OUT
OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY,
CONSTRUCTION, PERFORMANCE, BREACH OF TERMINATION THEREOF, TO BINDING ARBITRATION, AND THAT THIS
ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE’S RIGHT TO A JURY TRIAL AND RELATES TO THE
RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP INCLUDING,
BUT NOT LIMITED TO, STATUTORY DISCRIMINATION CLAIMS.

          Section 22. Representations and Warranties of Executive

          In order to induce Employer to enter into this Agreement, Executive represents and warrants to
Employer, to the best of his knowledge after the review of his personnel files, that: (a) the
execution and delivery of this Agreement by Executive and the performance of his obligations
hereunder will not violate or be in conflict with any fiduciary or other duty, instrument,
agreement, document, arrangement or other understanding to which Executive is a party or by which
he is or may be bound or subject; and (b) Executive is not a party to any instrument, agreement,
document, arrangement or other understanding with any person (other than Employer) requiring or
restricting the use or disclosure of any confidential information or the provision of any
employment, consulting or other services.

          Section 23. Waiver of Breach

          Except as may specifically provided herein, the failure of a party to insist on strict
adherence to any term of this Agreement on any occasion shall not be considered a waiver or deprive
that party of the right thereafter to insist upon strict adherence to that term or any term of this
Agreement. Any waiver hereto must be in writing.

[signature page follows]

14

 

          IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the
date first written above.

	 	 	 	 	 	 	 	 	 
	 	 	EXECUTIVE:	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	Eric D. Jacobs	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	EMPLOYER:	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 
	 

	 	 	 	Title:
	 	 

	 	 
	 

	 	 	 	Date:
	 	 

	 	 
	 

	 	 	 	 	 	 

	 	 

15EX-10.5

 

AMENDED AND RESTATED SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

     This Amended and Restated Senior Executive Employment Agreement (the
“Agreement”) is entered into as of this 8th day of August, 2007 (the “Effective
Date”) by and between Rajesh Sundaram (“Executive”) and DealerTrack Holdings,
Inc, a Delaware corporation (“Employer”) with principal offices at 1111 Marcus
Avenue, Suite M04, Lake Success, NY 11042.

     WHEREAS, Executive and DealerTrack, Inc. are parties to a senior executive
employment agreement, dated as of August 21, 2006 (the “Existing Employment
Agreement”); and

     WHEREAS, the parties hereto wish to amend and restate the Existing
Employment Agreement pursuant to this Agreement to, among other things, change
employer from DealerTrack, Inc. to DealerTrack Holdings, Inc. and amend certain
severance and non-compete terms;

     NOW, THEREFORE, in consideration of the promises and the agreements
hereinafter set forth, the parties hereto hereby agree that, upon the
effectiveness of this Agreement, the Existing Employment Agreement is hereby
amended and restated in its entirety as follows:

     Section 1. Term

     Employer shall continue to employ Executive and Executive agrees to
continue such employment, upon the terms and conditions hereinafter set forth,
from the Effective Date through and including August 8, 2008 (the “Initial
Term”). This Agreement shall renew automatically for successive one year
periods (each, a “Renewal Term”) unless one party gives notice to the other
party, in writing, at least sixty (60) days prior to the expiration of this
Agreement (or any renewal) of its desire to terminate the Agreement. The term
of this Agreement, including the Initial Term and any Renewal Term, shall be
referred to herein as the “Term”.

     Section 2. Executive’s Duties

     (a) Executive shall be Senior Vice President, Dealer Solutions and shall
report directly to Employer’s Chief Executive Officer or his designee.
Executive shall faithfully and diligently perform his duties at the direction
of Employer’s Chief Executive Officer, or his designee, to the best of
Executive’s ability. Executive shall (i) devote his best efforts, skill, and
ability and full business time and attention to the performance of the services
customarily incident to such office, subject to vacations and sick leave as
provided herein and in accordance with Employer policy, (ii) carry out his
duties in a competent and professional manner; and (iii) generally promote the
interests of Employer. Subject to applicable law, Executive shall not
knowingly participate in any activity that is detrimental to the interests of
Employer or any of its affiliates, including, without limitation, any public
criticism or disparagement of any type by Executive, through the media or
otherwise, of Employer or any of its affiliates or employees, except in
connection with the exercise of Executive’s rights against Employer or any of
its affiliates.

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     (b)  Executive agrees to abide by all policies applicable to senior
executive officers of Employer promulgated from time to time by Employer, which
policies are enforced uniformly and applicable to all similar executives of
Employer.

     (c)  Except for such business travel as may be incident to his duties
hereunder, Executive shall perform his duties at Employer’s offices at the
address set forth in the preamble to this Agreement or at such other location
as may be approved by Employer.

     Section 3. Compensation for Executive’s Services

     In consideration of the duties and services to be performed by Executive
pursuant to Sections 1 and 2 hereof, Executive shall receive:

     (a)  Salary. Executive shall earn salary (the “Salary”) at the annual rate
of Two Hundred Sixty Eight Thousand Dollars ($268,000) (the “Minimum Salary”),
less all applicable federal, state, and local tax withholdings. Such Salary
shall be earned and shall be payable in periodic installments in accordance
with Employer’s payroll practices. During the Term, the Board of Directors of
Employer (the “Board”) or the Compensation Committee of the Board (the
“Compensation Committee”) will review the Salary annually and may in its
discretion increase the Salary, but may not reduce it during the Term unless
Employer institutes salary reductions across the board; provided, however, that
in no event shall the Salary be reduced below the Minimum Salary without
Executive’s written consent.

     (b)  Bonus. For each fiscal year of Employer (each, a “Fiscal Year”),
Executive shall be entitled to receive a cash performance bonus (a “Bonus”)
which shall be based on the achievement of certain performance benchmarks by
Employer during such Fiscal Year which shall be determined by the Board. The
Board shall review the target Bonus on an annual basis and, in its sole
discretion, may increase such target Bonus for any Fiscal Year. The target
Bonus shall not be decreased except in connection with company-wide bonus
reductions. The target Bonus for any Fiscal Year shall be at least fifty five
(55%) percent of the Salary for such Fiscal Year. The Bonus for each Fiscal
Year shall be paid, if at all, to Executive on a schedule consistent with
Employer’s bonus payments to its other similarly situated senior executive
officers by no later than two and one half (21/2) months following the end of
such Fiscal Year. Executive understands and agrees that the Bonus is
established in part as an inducement for Executive to remain employed by
Employer and except as provided in Section 5(c) of this Agreement, or in the
Employer’s sole discretion, in the event that Executive’s employment is
terminated prior to the end of any Fiscal Year during the Term, then Executive
shall not receive payment of any Bonus for such year.

     (c)  Additional Compensation. Without limiting the amounts otherwise set
forth in this Agreement, Executive shall receive a payment each month (the
“Additional Compensation”) in arrears from the Effective Date of this Agreement
until the Note described in Section 3(d) below is issued, based on the
following formula:

     [ $1,200,000 (the “Face Amount”) ] x [the prime interest rate, as
published in the Wall Street Journal as of the Effective Date,
plus 1%, up to an aggregate maximum rate of 7%) (the “Interest
Rate”)] / 12

2

 

     (d)  Additional Bonus. As an additional inducement for Executive to remain
employed by Employer, Executive shall be eligible to receive an additional
bonus (the “Additional Bonus”), less all applicable federal, state and local
tax withholdings, as follows:

		
	 	     (1) If in any calendar year ending on or
before December 31, 2009 (y) the revenue from sales of
Automotive Lease Guide (alg), Inc. (“ALG”) products and
Chrome Systems Corporation (“Chrome”) products
(“ALG/Chrome Revenues”) for such year equals or exceeds
$50.0 million (the “ALG/Chrome Revenue Milestone”) and
(z) the EBITDA Ratio for the ALG/Chrome business for
such year equals or exceeds the EBITDA Ratio of the
Employer business as a whole (exclusive of the
ALG/Chrome business), then Employer shall promptly issue
to Executive a note in the principal amount of
$1,200,000 on the terms described in (d)(3) below (the
“Note”). “EBITDA Ratio” shall mean the ratio of the
earnings before interest, taxes, depreciation, and
amortization for the respective business in question
divided by the revenue from such business.

		
	 	     (2) If ALG/Chrome Revenues for the year
ending December 31, 2009 equal 70% of the ALG/Chrome
Revenue Milestone, and (d)(1)(z) above occurs for that
year, Employer shall issue to Executive a Note in the
principal amount of $600,000. If ALG/Chrome Revenues
for the year ending December 31, 2009 are greater than
70% of the ALG/Chrome Revenue Milestone, but less than
100% of such milestone and (d)(1)(z) above occurs, then
Employer shall issue to Executive a Note in the
principal amount of (x) $600,000 plus (y) $20,000 for
each additional $500,000 of ALG/Chrome Revenues for the
year ending December 31, 2009 in excess of 70% of the
ALG/Chrome Revenue Milestone and less than 100% of the
ALG/Chrome Revenue Milestone. For the avoidance of
doubt, there will be no additional $20,000 (or portion
thereof) added to the principal of the Note for each
incremental additional ALG/Chrome Revenues for the year
ending December 31, 2009 of less than $500,000. For
example, if ALG/Chrome Revenues for the year ending
December 31, 2009 are $36,200,000, then an additional
amount of $40,000 (i.e., $20,000 x2) shall be added to
the principal amount of the Note for a total principal
amount of $640,000.

		
	 	     (3) The
Note will provide that (w) it shall bear interest at the Interest Rate, (x) interest accrued
on the Note will be paid to the Executive monthly, (y) it will
be payable in full on June 30, 2010, and (z) it may be
prepaid without penalty at any time in Employer’s sole discretion.

		
	 	     (i) Within 90 days following
each of the years ending December 31, 2006, 2007,
2008 and 2009, Employer shall

3

 

		
	 	deliver to Executive Employer’s calculation, with
reasonable supporting detail (the “Employer’s
Calculation”) of ALG/Chrome Revenues or ALG
Revenues, as the case may be, and the applicable
EBITDA Ratios (collectively, the “Financial
Milestones”) for the preceding calendar year.

		
	 	     (ii) If Executive disagrees
with the Employer’s Calculation, the Executive
may, within 30 days after delivery of the
Employer’s Calculation, deliver a notice to
Employer disagreeing with any portion of the
Employer’s Calculation for such year (the
“Objection Notice”). The Objection Notice shall
specify in reasonable detail those items or
amounts as to which Executive disagrees. If
Executive does not deliver an Objection Notice
during such time period or Executive indicates
agreement with the Employer’s Calculation, then
the Employer’s Calculation shall be the agreed
upon amounts for the Financial Milestones for such
applicable period.

		
	 	     (iii) If Executive shall have
delivered the Objection Notice within the 30 day
period referred to in clause (ii) above, then
Employer and Executive shall, during the 30 days
following such delivery, use their good faith
efforts to reach agreement on the disputed items
or amounts in order to determine the Financial
Milestones. If Employer and Executive are unable
to reach agreement during such period, they shall
promptly thereafter cause a mutually acceptable
independent public accounting firm (the
“Accounting Referee”) to review the disputed items
or amounts for the purpose of calculating the
Financial Milestone(s) in dispute. The Accounting
Referee may request additional supporting detail
from the Employer pertaining to the portion of the
Employer’s Calculation identified by Executive in
the Objection Notice. Within ten (10) days after
delivery of such additional detail, the Executive
may supplement the Objection Notice to add any
disputes newly discovered by the Executive from
the additional detail, but only if such item in
dispute could not reasonably have been ascertained
from the supporting detail provided by Employer
with the Employer Calculation. The Objection
Notice may be supplemented only once. In making
such calculation, the Accounting Referee shall
consider only those items or amounts in the
Employer’s Calculation as to which the Executive
has disagreed and which are specifically
identified in reasonable notice in the Objection
Notice, as supplemented,

4

 

		
	 	if applicable. The Accounting Referee shall
deliver to Employer and Executive, as promptly as
practicable, a written report setting forth its
calculation of the items or amounts in dispute.
Such report shall be final and binding upon
Employer and Executive, absent manifest error or
willful misconduct. The cost of such review and
report shall be borne (x) by Executive, if
Employer’s calculation of the Financial
Milestone(s) in dispute is closer to the
Accounting Referee’s determination than
Executive’s calculation thereof, (y) by Employer,
if the reverse is true and (z) except as provided
in (x) or (y) above, equally by Executive and
Employer.

		
	 	     (4) If Employer sells or disposes of some
or all of the assets of ALG or Chrome or does not
collect fair market value for the products/services of
ALG or Chrome because said products/services were sold
as part of a bundle of products/services offered by
Employer, the terms of this Section 3(d) will be
adjusted equitably in the manner described under similar
circumstances in that Asset Purchase Agreement, dated
May 25, 2005, by and among Automotive Lease Guide (alg),
LLC, ALG, Executive and other parties (the “Purchase
Agreement”).

     (e) Equity. In connection with Executive’s employment, Executive has been
and may continue to be granted stock options (“Stock Options”) to purchase
equity securities of Employer pursuant to the terms of DealerTrack Holdings,
Inc. 2001 Stock Option Plan, effective as of August 10, 2001, as amended
(“Stock Option Plan”) or may be granted Stock Options or other equity based
awards pursuant to the terms of the DealerTrack Holdings, Inc. 2005 Incentive
Award Plan, effective as of May 26, 2005, as amended (the “2005 Incentive Award
Plan”), or any other successor equity incentive plans (collectively, the “Stock
Incentive Plans”). Except as otherwise provided herein, the terms of the Stock
Options shall be governed by the Stock Incentive Plans. Executive shall be
credited with twenty-four (24) months accelerated vesting of his Stock Options
upon termination of Executive’s employment by: (1) Employer without Cause (as
defined below); or (2) Executive for Good Reason (as defined below). Executive
shall be credited with thirty-six (36) months accelerated vesting of his Stock
Options upon a Change of Control (defined below). Executive shall be credited
with full acceleration and vesting of his Stock Options upon the earlier of:
(1) the elimination of Executive’s position or a termination of Executive’s
employment, in either event, within twelve (12) months after a Change of
Control; (2) a material negative change in Executive’s compensation or
responsibilities within twelve (12) months after a Change of Control; or (3)
the requirement that Executive be based at a location which is more than fifty
(50) miles from Employer’s offices at the address set forth in the preamble to
this Agreement within twelve (12) months after a Change of Control. Anything
in the Stock Incentive Plans to the contrary notwithstanding, if Executive’s
employment is terminated by Executive with Good Reason or by Employer without
Cause, or under circumstances described above which would result in certain
accelerated vesting of any

5

 

     unvested Stock Options held by Executive, the unexercised portion of any
Stock Options held by Executive will not terminate until the twelve (12) month
anniversary of the date of termination of Executive’s employment. In the event
Employer elects to grant equity based awards other than Options, such grants
shall, where appropriate, be subject to equivalent acceleration provisions as
set forth in this Section 3(c). For purposes hereof, a “Change of Control”
shall mean and includes each of the following:

		
	 	     (i) A transaction or series of transactions (other than an offering
of shares of Employer to the general public through a registration
statement filed with the Securities and Exchange Commission) whereby any
“person” or related “group” of “persons” (as such terms are used in
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as
amended) (other than the Employer, any of its subsidiaries, an employee
benefit plan maintained by the Employer or any of its subsidiaries or a
“person” that, prior to such transaction, directly or indirectly
controls, is controlled by, or is under common control with, the
Employer) directly or indirectly acquires beneficial ownership (within
the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as
amended) of securities of the Employer possessing more than 50% of the
total combined voting power of the Employer’s securities outstanding
immediately after such acquisition; or

		
	 	     (ii) During any period of two consecutive years, individuals who, at
the beginning of such period, constitute the Board together with any new
director(s) (other than a director designated by a person who shall have
entered into an agreement with the Company to effect a transaction
described in Section 3(c)(i) or Section 3(c)(iii)) whose election by the
Board or nomination for election by the Employer’s stockholders was
approved by a vote of at least two-thirds of the directors then still in
office who either were directors at the beginning of the two-year period
or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof; or

		
	 	     (iii) The consummation by the Employer (whether directly involving
the Employer or indirectly involving the Employer through one or more
intermediaries) of (x) a merger, consolidation, reorganization, or
business combination or (y) a sale or other disposition of all or
substantially all of the Employer’s assets in any single transaction or
series of related transactions or (z) the acquisition of assets or stock
of another entity, in each case other than a transaction:

		
	 	     (A) Which results in the Employer’s voting securities
outstanding immediately before the transaction continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the Employer or the person that, as a
result of the transaction, controls, directly or indirectly, the
Employer or owns, directly or indirectly, all or substantially all
of the Employer’s assets or otherwise succeeds to the business of
the Employer (the Employer or such person, the “Successor Entity”))
directly or indirectly, at least a majority of the combined voting
power of the Successor Entity’s outstanding voting securities
immediately after the transaction, and

6

 

		
	 	(B) After which no person or group beneficially owns voting
securities representing 50% or more of the combined voting power of
the Successor Entity; provided, however, that no person or group
shall be treated for purposes of this Section 3(c)(iii) as
beneficially owning 50% or more of combined voting power of the
Successor Entity solely as a result of the voting power held in the
Employer prior to the consummation of the transaction; or

		
	 	     (iv) The Employer’s stockholders approve a liquidation or
dissolution of the Employer.

     The Board or its designee shall have full and final authority, which shall be
exercised in its discretion, to determine conclusively whether a Change of
Control of the Employer has occurred, and the date of the occurrence of such
Change of Control and any incidental matters relating thereto.

     (f)  Benefits. Employer shall provide Executive with the right to
participate in and receive benefits from all life, accident, disability,
medical and pension plans, and all similar benefits as are from time to time in
effect and are generally made available to similar situated senior executive
officers of Employer. The amount and extent of benefits to which Executive is
entitled shall be governed by the specific benefit plan, as it may be amended
from time to time.

     (g)  Expenses. Employer shall promptly reimburse Executive for reasonable
expenses for cellular telephone usage, entertainment, travel, meals, lodging
and similar items incurred in the conduct of Employer’s business. Such
expenses shall be reimbursed in accordance with Employer’s expense
reimbursement policies and guidelines.

     (h)  Vacation; Sick Leave. During the Term, Executive shall be entitled to
four weeks (4) weeks vacation per year, paid holidays, sick leave, and similar
benefits, to be earned and used in accordance with Employer’s policy and
procedure for other similarly situated senior executive officers.

     (i)  Modification. Employer reserves the right to modify, suspend or
discontinue any and all of the above plans, practices, policies and programs
referenced in Sections 3(f) and (g) at any time in its discretion without
recourse by Executive so long as such action is taken generally with respect to
other similarly situated senior executive officers. Any such modification,
suspension or discontinuance of the plans, practices and policies referenced in
Section 3(g) will not apply to otherwise reimbursable expenses incurred by
Executive prior to any such modification, suspension or discontinuance.

     Section 4. Termination of Employment

     (a)  Resignation. Executive may voluntarily terminate his employment with
Employer, at any time, with or without Good Reason, upon written notice to
Employer.

     (b) Termination. Employer may terminate Executive’s employment at any
time, with or without Cause, upon written notice to Executive.

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     (c)  Death or Disability. Executive’s employment shall terminate
immediately upon Executive’s death. In the event Employer, in good faith,
determines that Executive is unable to perform the functions of his position
due to a Disability (as defined below), it may notify Executive in writing of
its intention to terminate Executive’s employment and Executive’s employment
with Employer shall terminate effective on the thirtieth (30th) day after
receipt of such notice by Executive. For the purposes of this Agreement,
“Disability” shall mean a physical or mental impairment that substantially
limits a major life activity of Executive and renders Executive unable to
perform the essential functions of his position even with reasonable
accommodation (that does not impose an undue hardship on Employer), and which
has lasted at least (i) sixty (60) consecutive days, (ii) the balance of
Executive’s entitlement to leave, if any, under the Family and Medical Leave
Act, or other similar statute or (iii) the balance of any election period under
the Employer’s long term disability program (without regard to whether
Executive is awarded benefits under such program), whichever is longer.

     (d)  Cause. Employer may immediately terminate Executive’s employment for
“Cause” by giving written notice to Executive. For purposes of this Agreement,
“Cause” shall mean:

		
	 	     (1) Executive’s commission of an act of
fraud or embezzlement upon Employer or any of its
affiliates; or

		
	 	     (2) Executive’s commission of any willful
act intended to injure the reputation, business, or any
business relationship of Employer or any of its
affiliates; or

		
	 	     (3) Executive is found by a court of
competent jurisdiction to have committed a felony; or

		
	 	     (4) the refusal or failure of Executive
to perform Executive’s duties with Employer in a
competent and professional manner that is not cured by
Executive within ten (10) business days after a written
demand therefor is delivered to Executive by the Board
which specifically identifies the manner in which the
Board believes that Executive has not substantially
performed Executive’s duties; provided, further,
however, that if the Board, in good faith, determines
that the refusal or failure by Executive is egregious in
nature or is not susceptible of cure, then no cure
period shall be required hereunder; or

		
	 	     (5) the refusal or failure of Executive
to comply with any of his material obligations under
this Agreement (including any exhibit hereto) that is
not cured by Executive within ten (10) business days
after a written demand therefor is delivered to
Executive by the Board which specifically identifies the
manner in which the Board believes Executive has
materially breached this Agreement; provided, further,
however, that if the Board, in good faith, determines
that the refusal or failure by Executive is egregious in

8

 

		
	 	nature or is not susceptible of cure, then no cure
period shall be required hereunder.

     (e)  Good Reason. Executive may terminate his employment for “Good
Reason,” by delivering written notice of such termination (“Employer Default
Notice”) to Employer within sixty (60) days of the occurrence of any of the
following events, each of which shall constitute Good Reason: (i) Employer’s
material breach of any provision of this Agreement, the Stock Incentive Plans
or any agreements thereunder, which has not been cured within the allotted
time; (ii) a material reduction of Executive’s then current title, status,
authority, responsibility or duties or the assignment to Executive of any
duties materially inconsistent with Executive’s then current position; (iii)
any material reduction in Executive’s salary or benefits; (iv) the failure of
any successor entity to assume the terms of this Agreement upon any Change of
Control; (v) the relocation of Executive to a facility or location more than
fifty (50) miles from Employer’s principal offices at the address set forth in
the preamble to this Agreement; or (vi) the failure of Employer to renew this
Agreement upon the expiration of the Initial Term or any Renewal Term. The
Employer Default Notice shall specify the reason for Executive’s belief that an
event constituting Good Reason has occurred. Notwithstanding the foregoing,
any material breach of this Agreement by Employer, or other event constituting
Good Reason, shall not constitute Good Reason if any such breach or other event
is cured or corrected by Employer within thirty (30) days following delivery to
Employer of the Employer Default Notice.

     (f)  Continuing Obligations. Executive acknowledges and agrees that any
termination under this Section 4 is not intended, and shall not be deemed or
construed, to affect in any way any of Executive’s covenants and obligations
contained in Sections 6, 7, and 8 hereof, which shall continue in full force
and effect beyond such termination for any reason.

     Section 5. Termination Obligations

     (a)  Resignation. If Executive’s employment is terminated voluntarily by
Executive without Good Reason, Executive’s employment shall terminate without
further obligations to Executive other than for payment of the sum of any
unpaid Salary determined by the Board and reimbursable expenses and vacation
accrued and owing to Executive prior to the termination. The sum of such
amounts shall hereinafter be referred to as the “Accrued Obligations,” which
shall be paid to Executive or Executive’s estate or beneficiary within thirty
(30) days of the date of termination. If Executive voluntarily terminates his
employment without Good Reason and within (30) days of such termination,
Employer determines that it would have had Cause to terminate Executive
pursuant to Section 4(d), Executive shall be deemed to have been terminated for
Cause and the terms of Section 5(b) shall apply.

     (b) Cause. If Executive’s employment is terminated by Employer for Cause,
this Agreement shall terminate without further obligations to Executive other
than for the timely payment of Accrued Obligations. If it is subsequently
determined by an arbitrator, pursuant to Section 19 hereof, that Employer did
not have Cause for termination, then Employer’s decision to terminate shall be
deemed to have been made without Cause and the terms of Section 5(c) shall
apply.

9

 

     (c)  By Employer Other than for Cause; Death or Disability; By Executive
for Good Reason.

     (1)  If (A) Employer terminates Executive’s employment for (x) a reason
other than Cause, or (y) due to Executive’s death or Disability, or (B)
Executive terminates his employment for Good Reason, Employer shall have no
further obligations to Executive other than for (i) the payment of Accrued
Obligations, (ii) severance pay in an amount equal to twelve (12) months of
Salary and payable within thirty (30) days of the Severance Commencement Date;
provided, however, that in the event that Executive’s termination of employment
is within twelve (12) months after a Change of Control, such severance pay
shall be increased to an amount equal to twenty four (24) months of Salary,
(iii) a pro rata bonus calculated based on multiplying the percentage of the
year Executive worked for Employer during the year of his termination by
Executive’s target Bonus for such year and payable within thirty (30) days of
the Severance Commencement Date, (iv) the reimbursement of premiums otherwise
payable by Executive pursuant to COBRA for a period of up to 12 months, or
until Executive no longer is eligible for COBRA continuation coverage,
whichever is earlier, (v) the Additional Bonus, payable, if any, as set forth
in Section 3(d) above, and (vi) the Additional Compensation, payable as set
forth in Section 3(c) above until the earlier of June 30, 2010 or the Note is
issued. For purposes of this Section 5, “Severance Commencement Date” shall
mean (x) if any stock of Employer or its affiliates is publicly traded on an
established securities market or otherwise and the Board (or its delegate)
determines that as of the date of termination of Executive’s employment that
the Executive is a “key employee” (within the meaning of Section 416(i) of the
Internal Revenue Code of 1986, as amended (the “Code”), as interpreted in
accordance with Section 409A of the Code and Department of Treasury regulations
and other interpretive guidance issued thereunder) and that Section 409A of the
Code applies with respect to payments to Executive pursuant to Section
5(c)(1)(ii) and (iii), the six-month anniversary of the date of the Executive’s
“separation from service” (within the meaning of section 409A of the Code); or
(y) if the Board (or its delegate) determines that Executive is not such a “key
employee” as of date of Executive’s termination of employment (or that Section
409A of the Internal Revenue Code does not apply with respect to payments to
the Executive pursuant to Section 5(c)(1)(ii) and (iii)), the date of
Executive’s termination of employment. The payments described in this Section
5(c)(1)(i) shall be made within thirty (30) days of the date of Executive’s
termination of employment.

     (2)  If Executive terminates his employment for Good Reason and it is
subsequently determined by an arbitrator, pursuant to Section 20 hereof, that
Executive did not have Good Reason for termination, then Executive’s decision
to terminate for Good Reason shall be deemed to have been a voluntary
resignation, the terms of Section 5(a) shall apply, and all monies paid to
Executive pursuant to this Section 5(c)(1), except for those monies paid
pursuant to Section 5(c)(1)(i), shall be immediately returned to Employer.

     (3) The amounts payable pursuant to Section 5(c)(1) shall be the only
amounts Executive shall receive for termination in accordance with this Section
5(c); provided, however, that no amounts shall be payable pursuant to this
section 5(c) on or following the date Executive breaches any of Sections 7, 8
or 9 of this Agreement.

10

 

     (d)  Release. Notwithstanding anything to the contrary contained herein,
no severance payments required hereunder shall be made by Employer until such
time as Executive shall execute a general release for the benefit of Employer
and its affiliates in a form satisfactory to Employer. Such general release
shall not apply to (i) Executive’s rights under any Stock Incentive Plan award
agreements or (ii) Executive’s rights, as applicable, to indemnification under
Employer’s charter or bylaws, any indemnification agreement or applicable law.

     (e)  Equity Compensation Awards. Except as expressly provided herein,
except for the provisions of Section 3(c) of this Agreement, the terms of the
Stock Incentive Plans and any related award agreements and/or notice of grant
shall govern the termination, vesting, and/or exercise of Executive’s stock
options or other equity awards upon the termination of Executive’s employment
for any reason.

     (f)  Exclusive Remedy. Executive agrees that the payments set forth in
this Agreement shall constitute the exclusive and sole remedy for any
termination of Executive’s employment and Executive covenants not to assert or
pursue any other remedies, at law or in equity, with respect to this Agreement.

     (g)  Termination of Executive’s Office. Following the termination of
Executive’s employment for any reason, Executive shall hold no further office
or position with Employer or any of its affiliates.

     Section 6. Parachute Payments.

     (a)  If it is determined by a nationally recognized United States public
accounting firm selected by the Employer and approved in writing by the
Executive (which approval shall not be unreasonably withheld) (the “Auditors”)
that any payment or benefit made or provided to the Executive in connection
with this Agreement or otherwise (including without limitation any Stock Option
or other equity based award vesting) (collectively, a “Payment”), would be
subject to the excise tax imposed by Section 4999 of the Code (the “Parachute
Tax”), then the Employer shall pay to the Executive, prior to the time the
Parachute Tax is payable with respect to such Payment, an additional payment (a
“Gross-Up Payment”) in an amount such that, after payment by the Executive of
all taxes (including any Parachute Tax) imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Parachute Tax
imposed upon the Payment. The amount of any Gross-Up Payment shall be
determined by the Auditors, subject to adjustment, as necessary, as a result of
any Internal Revenue Service position. For purposes of making the calculations
required by this Agreement, the Auditors may make reasonable assumptions and
approximations concerning applicable taxes and may rely on reasonable, good
faith interpretations concerning the application of Sections 280G and 4999 of
the Code, provided that the Auditors’ determinations must be made with
substantial authority (within the meaning of Section 6662 of the Code).

     (b) The federal tax returns filed by the Executive (and any filing made by
a consolidated tax group which includes the Employer) shall be prepared and
filed on a basis consistent with the determination of the Auditors with respect
to the Parachute Tax payable by the Executive. The Executive shall make proper
payment of the amount of any Parachute Tax, and at the request of the Employer,
provide to the Employer true and correct copies (with any

11

 

     amendments) of his federal income tax return as filed with the Internal
Revenue Service, and such other documents reasonably requested by the Employer,
evidencing such payment. If, after the Employer’s payment to the Executive of
the Gross-Up Payment, the Auditors determine in good faith that the amount of
the Gross-Up Payment should be reduced or increased, or such determination is
made by the Internal Revenue Service, then within ten (10) business days of
such determination, the Executive shall pay to the Employer the amount of any
such reduction, or the Employer shall pay to the Executive the amount of any
such increase; provided, however, that in no event shall the Executive have any
such refund obligation if it is determined by the Employer that to do so would
be a violation of the Sarbanes-Oxley Act of 2002, as it may be amended from
time to time; and provided, further, that if the Executive has prior thereto
paid such amounts to the Internal Revenue Service, such refund shall be due
only to the extent that a refund of such amount is received by the Executive;
and provided, further, that (i) the fees and expenses of the Auditors (and any
other legal and accounting fees) incurred for services rendered in connection
with the Auditor’s determination of the Parachute Tax or any challenge by the
Internal Revenue Service or other taxing authority relating to such
determination shall be paid by the Employer and (ii) the Employer shall
indemnify and hold the Executive harmless on an after-tax basis for any
interest and penalties imposed upon the Executive to the extent that such
interest and penalties are related to the Auditor’s determination of the
Parachute Tax or the Gross-Up Payment. Notwithstanding anything to the
contrary herein, the Executive’s rights under this Section 6 shall survive the
termination of his employment for any reason and the termination or expiration
of this Agreement for any reason.

     Section 7. Restrictions Respecting Confidential Information

     Executive hereby covenants and agrees that, during his employment and
thereafter, Executive will not, under any circumstance, disclose in any way any
Confidential Information (as defined below) to any other person other than (i)
at the direction of and for the benefit of Employer, (ii) to his attorney or
other advisers in connection with Executive’s enforcement of his rights
hereunder, provided such individuals or entities agree to be bound by the
confidentiality restrictions herein contained, and if such Confidential
Information is relevant to such enforcement action, to the court or arbitrator,
as applicable, subject to a protective order. For the purposes of the
foregoing, “Confidential Information” means any information pertaining to the
assets, business, creditors, vendors, manufacturers, customers, data,
employees, financial condition or affairs, formulae, licenses, methods,
operations, procedures, reports, suppliers, systems and technologies of
Employer and its affiliates, including (without limitation) the contracts,
patents, trade secrets and customer lists developed or otherwise acquired by
Employer and its affiliates; provided, however, that Confidential Information
shall exclude any information that was, is, or becomes publicly available other
than through disclosure by Executive or any other person known to Executive to
be subject to confidentiality obligations to Employer. All Confidential
Information is and will remain the sole and exclusive property of Employer and
its affiliates. Following the termination of his employment, Executive shall
return all documents and other tangible items containing Confidential
Information to Employer, without retaining any copies, notes or excerpts
thereof.

     Section 8. Proprietary Matters

12

 

     Executive expressly understands and agrees that any and all improvements,
inventions, discoveries, processes, or know-how that are generated or conceived
by Executive during the Term (collectively, the “Inventions”) will be the sole
and exclusive property of Employer, and Executive will, whenever requested to
do so by Employer (either during the Term or thereafter), execute and assign
any and all applications, assignments and/or other instruments and do all
things which Employer may deem necessary or appropriate in order to apply for,
obtain, maintain, enforce and defend patents, copyrights, trade names or
trademarks of the United States or of foreign countries for said Inventions, or
in order to assign and convey or otherwise make available to Employer the sole
and exclusive right, title, and interest in and to said Inventions,
applications, patents, copyrights, trade names or trademarks; provided,
however, that the provisions of this Section 8 shall not apply to an Invention
that Executive developed entirely on his own time without using Employer’s
Confidential Information except for those Inventions that either (i) directly
and materially relate, at the time of conception or reduction to practice of
the invention, to Employer’s business, or actual or demonstrably anticipated
research or development of Employer, or (ii) directly and materially result
from any work performed by Executive for Employer. Executive shall promptly
communicate and disclose to Employer all Inventions conceived, developed or
made by him during his employment by Employer, whether solely or jointly with
others, and whether or not patentable or copyrightable, (a) which relate to any
matters or business of the type carried on or being developed by Employer, or
(b) which result from or are suggested by any work done by him in the course of
his employment by Employer. Executive shall also promptly communicate and
disclose to Employer all material other data obtained by him concerning the
business or affairs of Employer in the course of his employment by Employer.

     Section 9. Nonsolicitation/Non-Compete

     (a)  Executive agrees that throughout his employment and for a period of
two (2) years following the termination of his employment for any reason, he
will not directly or indirectly, own, manage, operate, control, or participate
in the ownership, management, operation, or control of, or be connected with,
or have any financial interest in, any Competitor. Ownership, for personal
investment purposes only, of not to exceed (i) individually, two (2%) percent
of the outstanding capital stock of any privately held entity, or (ii) voting
stock of any publicly held corporation shall not constitute a violation hereof.
For purposes of this Agreement, the term “Competitor” shall mean any
individual or entity, present or future, then providing any of the following
products or services: (1) a multi-finance source automotive finance portal, (2)
electronic contracting for automotive finance or lease transactions, other than
at a financing source entity that purchases electronic contracts or leases from
automotive dealers, (3) automotive lease, retail and/or balloon payment
comparison or desking tools, (4) dealer management systems (DMS), (5) any other
sales or finance and insurance-related products or services for automotive
dealerships similar to any products or services offered by Employer or any of
its affiliates, or (6) any other products or services similar to any products
or services offered by Employer or any of its affiliates and which product or
service category accounts for at least 15% of the consolidated revenues for the
last fiscal quarter of Employer.

     (b) Executive agrees that during his employment with Employer and for a
period of two (2) years following the termination of his employment for any
reason, he will not

13

 

     actively solicit for employment, consulting or any other arrangement any
employee of Employer or any of its present or future affiliates (while an
affiliate).

     (c)  Executive agrees that during his employment with Employer and for a
period of two (2) years following the termination of his employment for any
reason, he will not influence or attempt to influence customers of Employer or
any of its present or future affiliates, either directly or indirectly, to
divert their business to any Competitor.

     (d)  The restrictions contained in this Section 9 are necessary for the
protection of the business and goodwill of Employer and are considered by
Executive to be reasonable for such purpose. Further, Executive represents
that these restrictions will not prevent him from earning a livelihood during
the restricted period.

     (e)  This Section 9 shall survive the termination or expiration of this
Agreement.

     Section 10. Equitable Relief

     Executive acknowledges and agrees that Employer will suffer irreparable
damage which cannot be adequately compensated by money damages in the event of
a breach, or threatened breach, of any of the terms and provisions of Sections
7, 8 and 9 of this Agreement, and that, in the event of any such breach, or
threatened breach, Employer will not have an adequate remedy at law. It is
therefore agreed that Employer, in addition to all other such rights, powers,
privileges and remedies that it may have, shall be entitled to injunctive
relief, specific performance or such other equitable relief as Employer may
request to enforce any of those terms and provisions and to enjoin or otherwise
restrain any act prohibited thereby, and Executive will not raise and hereby
waives any objection or defense that there is an adequate remedy available at
law. Notwithstanding the provisions of Section 20 of this Agreement, Executive
agrees that Employer shall be entitled to seek such injunctive relief, without
bond, in a court of competent jurisdiction and Executive hereby consents to the
jurisdiction of the state and federal courts of New York for purposes of such
an action. Executive agrees that any claim he may have against Employer or any
of its affiliates shall not constitute a defense against the issuance of any
such equitable relief. The foregoing shall not constitute a waiver of any of
Employer’s rights, powers, privileges and remedies against or in respect of a
breaching party or any other person or thing under this Agreement, or
applicable law.

     Section 11. Notice

     Any notice, request, demand or other communication hereunder shall be in
writing, shall be delivered by hand or sent by registered or certified mail or
by reputable overnight delivery service, postage prepaid, to the addressee at
the address set forth below (or at such other address as shall be designated
hereunder by written notice to the other party hereto) and shall be deemed
conclusively to have been given when actually received by the addressee.

     All notices and other communications hereunder shall be addressed as
follows:

		
	 	     If to Executive at the address set forth in the
Employer’s payroll records.

14

 

		
	 	If to Employer:

	 	 
	 	DealerTrack Holdings, Inc.

1111 Marcus Avenue, Suite M04

Lake Success, NY 11042

	 	 
	 	With a copy to:

	 	 
	 	General Counsel

DealerTrack Holdings, Inc.

1111 Marcus Avenue, Suite M04

Lake Success, NY 11042

or to such other address as either party shall have furnished to the other in

writing in accordance herewith.

     Section 12. Legal Counsel

     In entering into this Agreement, the parties represent that they have
relied upon the advice of their attorneys, who are attorneys of their own
choice, and that the terms of this Agreement have been completely read and
explained to them by their attorneys, and that those terms are fully understood
and voluntarily accepted by them.

     Section 13. Section and Other Headings

     The section and other headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.

     Section 14. Governing Law

     This Agreement has been executed and delivered, and shall be governed by
and construed in accordance with the applicable laws pertaining, in the State
of New York, without regard to conflicts of laws principles.

     Section 15. Severability

     In the event that any term or provision of this Agreement shall be finally
determined to be superseded, invalid, illegal or otherwise unenforceable
pursuant to applicable law by a governmental authority having jurisdiction and
venue, that determination shall not impair or otherwise affect the validity,
legality or enforceability, to the maximum extent permissible by law, (a) by or
before that authority of the remaining terms and provisions of this Agreement,
which shall be enforced as if the unenforceable term or provision were deleted,
or (b) by or before any other authority of any of the terms and provisions of
this Agreement.

     Section 16. Counterparts

     Section 17. This Agreement may be executed in two counterpart copies of
the entire document or of signature pages to the document, each of which may be
executed by one of

15

 

     the parties hereto, but all of which, when taken together, shall
constitute a single agreement binding upon both of the parties hereto.

     Section 18. Benefit

     This Agreement shall be binding upon and inure to the benefit of the
respective parties hereto and their legal representatives, successors and
assigns. Insofar as Executive is concerned, this Agreement, being personal,
cannot be assigned; provided, however, that should Executive become entitled to
payment pursuant to Section 5 hereof, he may assign his rights to such payment
to his legal representatives, successors, and assigns. Without limiting the
generality of the foregoing, all representations, warranties, covenants and
other agreements made by or on behalf of Executive in this Agreement shall
inure to the benefit of the successors and assigns of Employer.

     Section 19. Modification

     This Agreement may not be amended or modified other than by a written
agreement executed by all parties hereto.

     Section 20. Entire Agreement

     Except as provided in Section 5(e) hereof, this Agreement contains the
entire agreement of the parties and supersedes all other representations,
warranties, agreements and understandings, oral or otherwise, among the parties
with respect to the matters contained herein, including any prior employment
agreements between Executive and Employer or any affiliate of Employer.
Nothing in this Agreement shall be deemed to affect in any way the term or
enforceability of that certain Unfair Competition and NonSolicitation Agreement
by and between ALG and Executive or the Relocation Letter sent to Executive in
connection with his relocation to New York which agreements shall remain in
full force and effect.

     Section 21. Arbitration

     (a)  Executive agrees that any dispute or controversy arising out of,
relating to, or in connection with this Agreement or the termination thereof,
or the interpretation, validity, construction, performance, breach, or
termination thereof, shall be settled by expedited, binding arbitration to be
held in New York, New York in accordance with the National Rules for the
Resolution of Employment Disputes then in effect of the American Arbitration
Association (the “Rules”). The arbitrator may grant injunctions or other
relief in such dispute or controversy. The decision of the arbitrator shall be
final, conclusive and binding on the parties to the arbitration. Judgment may
be entered on the arbitrator’s decision in any court having jurisdiction. The
arbitrator may award the prevailing party its reasonable attorney’s fees.

     (b)  The arbitrator shall apply New York law to the merits of any dispute
or claim, without reference to rules of conflicts of law. The arbitration
proceedings shall be governed by federal arbitration law and by the Rules,
without reference to state arbitration law.

     (c) EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES
ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING

16

 

     THIS AGREEMENT, EXECUTIVE IS AGREEING TO SUBMIT ANY CLAIMS ARISING OUT OF,
RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION,
VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OF TERMINATION THEREOF, TO BINDING
ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF
EXECUTIVE’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES
RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE RELATIONSHIP INCLUDING, BUT
NOT LIMITED TO, STATUTORY DISCRIMINATION CLAIMS.

     Section 22. Representations and Warranties of Executive

     In order to induce Employer to enter into this Agreement, Executive
represents and warrants to Employer, to the best of his knowledge after the
review of his personnel files, that: (a) the execution and delivery of this
Agreement by Executive and the performance of his obligations hereunder will
not violate or be in conflict with any fiduciary or other duty, instrument,
agreement, document, arrangement or other understanding to which Executive is a
party or by which he is or may be bound or subject; and (b) Executive is not a
party to any instrument, agreement, document, arrangement or other
understanding with any person (other than Employer) requiring or restricting
the use or disclosure of any confidential information or the provision of any
employment, consulting or other services.

     Section 23. Waiver of Breach

     Except as may specifically provided herein, the failure of a party to
insist on strict adherence to any term of this Agreement on any occasion shall
not be considered a waiver or deprive that party of the right thereafter to
insist upon strict adherence to that term or any term of this Agreement. Any
waiver hereto must be in writing.

     [signature page follows]

17

 

     IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first written above.

	 	 
	 	EXECUTIVE:
	 	 
	 	 
	 	 
	 	
 
	 	Rajesh Sundaram
	 	 
	 	 
	 	 
	 	EMPLOYER:
	 	 
	 	 
	 	 
	 	By:  
	 	
 
	 	
Name:
	 	
 
	 	Title:
	 	
 
	 	Date:
	 	
 
	 	 
	 	Agreed to and acknowledged
	 	 
	 	DealerTrack, Inc.
	 	 
	 	 
	 	By:
	 	
 
	 	Name:
	 	
 
	 	Title:
	 	
 
	 	Date:
	 	
 
	 	 

18

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