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 David Trinder (“ 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 Aftermarket Services, Inc. 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 to, among other
things, change employer from DealerTrack Aftermarket Services, 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:
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, Network 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.
(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 (2 1
/ 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:
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(1)
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Executive’s commission of an
act of fraud or embezzlement upon Employer or any of its
affiliates; or
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(2)
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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
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(3)
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Executive is found by a court of
competent jurisdiction to have committed a felony; or
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(4)
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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
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(5)
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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.
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(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 t
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