8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) December 10, 2008

Autobytel Inc.

(Exact name of registrant as specified in its charter)

Delaware	0-22239	33-0711569
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

18872 MacArthur Boulevard, Irvine, California	92612-1400
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (949) 225-4500

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

Employment Agreement with Mr. Coats

In connection with the appointment of Jeffrey H. Coats to the office of President and Chief Executive Officer of Autobytel Inc., a Delaware corporation (“Autobytel”), as described in Item 5.02 below, Autobytel and Mr. Coats entered into an Employment Agreement (the “Coats Employment Agreement”) dated as of December 11, 2008. Pursuant to the terms of the Coats Employment Agreement, Mr. Coats will be paid a monthly salary of $35,000. Mr. Coats will be entitled to all customary benefits afforded generally to executive employees of Autobytel, including any qualified or non-qualified pension, profit sharing and savings plans, any death benefit and disability benefit plans, life insurance coverages, any medical, dental, health and welfare plans or insurance coverages and any stock purchase programs that are approved in writing by the Board. Autobytel will pay or reimburse Mr. Coats for all reasonable and authorized business expenses incurred by Mr. Coats while employed under the Coats Employment Agreement.

The foregoing description of the Coats Employment Agreement is qualified in its entirety by reference to the full text of Mr. Coats’ employment agreement, a copy of which is filed herewith as Exhibit 10.1 and incorporated herein by reference.

Amendment to Mr. Riesenbach’s Employment Agreement

On December 10, 2008, Autobytel entered into an amendment to its employment agreement with James E. Riesenbach, its President and Chief Executive Officer (the “Riesenbach Employment Agreement Amendment”). The Riesenbach Employment Agreement Amendment amends certain terms of Mr. Riesenbach’s employment agreement dated March 1, 2006. The amendment (1) modifies the definition of voluntary termination for “good reason,” (2) modifies the terms and conditions upon which certain reimbursements and payments shall be made to Mr. Riesenbach under the employment agreement, and (3) provides additional terms upon which any gross-up payments to which Mr. Riesenbach is entitled under the employment agreement shall be made. Except as set forth in the Riesenbach Employment Agreement Amendment, all other terms of Mr. Riesenbach’s employment agreement remained unchanged.

The foregoing description of the Riesenbach Employment Agreement Amendment is qualified in its entirety by reference to the full text of (1) the amendment to Mr. Riesenbach’s employment agreement, a copy of which is filed herewith as Exhibit 10.2 and incorporated herein by reference, and (2) the employment agreement with Mr. Riesenbach, a copy of which was filed as Exhibit 10.47 to Autobytel’s Form 10-K filed March 17, 2008 and is incorporated herein by reference.

Separation Agreement with Mr. Riesenbach

On December 10, 2008, after entering into the Riesenbach Employment Agreement Amendment with Mr. Riesenbach, Autobytel notified Mr. Riesenbach that his employment by Autobytel as its President and Chief Executive Officer had been terminated. In connection with the termination of Mr. Riesenbach’s employment as described in Item 5.02 below, as contemplated by his employment agreement, Autobytel entered into a Separation Agreement and Release (the “Separation Agreement”) with Mr. Riesenbach on December 11, 2008, which governs the terms of the separation of Mr. Riesenbach from his employment by Autobytel.

Under the Separation Agreement, Mr. Riesenbach will be entitled to certain severance benefits as described in his employment agreement, including (1) a severance payment of approximately $1.7 million, and (2) all benefits that were non-taxable while Mr. Riesenbach was employed by Autobytel at the time they would have been paid had Mr. Riesenbach remained an employee for a period of twenty-four (24) months following December 10, 2008; provided that Autobytel shall no longer be required to pay such benefits to Mr. Riesenbach to the extent that, during such 24 month period, Mr. Riesenbach receives substantially similar (or better) benefits from a new employer.

The Separation Agreement is subject to a seven (7) day revocation period during which Mr. Riesenbach may revoke the Separation Agreement. If Mr. Riesenbach revokes the Separation Agreement during this period, he will no longer be entitled to the severance benefits described in the paragraph above.

The foregoing description of the Separation Agreement is qualified in its entirety by reference to the full text of (1) the separation agreement with Mr. Riesenbach, a copy of which is filed herewith as Exhibit 10.3 and incorporated herein by reference, (2) the full text of the employment agreement with Mr. Riesenbach, a copy of which was filed as Exhibit 10.47 to Autobytel’s Form 10-K filed March 17, 2008 and is incorporated herein by reference, and (3) the amendment to Mr. Riesenbach’s employment agreement, a copy of which is filed herewith as Exhibit 10.2 and incorporated herein by reference.

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Item 1.02 Termination of a Material Definitive Agreement.

On December 10, 2008, James E. Riesenbach was terminated without cause as the President and Chief Executive Officer of Autobytel. The employment agreement between Autobytel and Mr. Riesenbach dated March 1, 2006, as amended on December 10, 2008 by the Riesenbach Employment Agreement Amendment described in Item 1.01 above under the heading “Amendment to Mr. Riesenbach’s Employment Agreement,” which is incorporated herein by reference, was terminated effective December 10, 2008 by a letter dated December 10, 2008 from Autobytel to Mr. Riesenbach (the “Termination Letter”).

The foregoing description of the Termination Letter is qualified in its entirety by reference to the full text of the termination letter, a copy of which is filed herewith as Exhibit 10.4 and incorporated herein by reference.

On December 11, 2008, Autobytel and Mr. Riesenbach entered into the Separation Agreement described in Item 1.01 above under the heading “Separation Agreement with Mr. Riesenbach,” which is incorporated herein by reference.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Termination of Mr. Riesenbach as President and Chief Executive Officer; Resignation as Director

At a meeting of the Board of Directors of Autobytel held on December 8, 2008 (the “December 8th Board Meeting”), the Board determined to terminate James E. Riesenbach’s employment as President and Chief Executive Officer of Autobytel which termination would only be effective after due notice was provided to Mr. Riesenbach in accordance with his employment agreement. Prior to terminating Mr. Riesenbach’s employment, Autobytel and Mr. Riesenbach entered into the Riesenbach Employment Agreement Amendment described in Item 1.01 above under the heading “Amendment to Mr. Riesenbach’s Employment Agreement,” which is incorporated herein by reference. Once the Riesenbach Employment Agreement Amendment became effective Autobytel provided notice to Mr. Riesenbach that his employment by Autobytel had been terminated without cause and thereafter Autobytel and Mr. Riesenbach entered into the Separation Agreement on December 11, 2008, as described in Item 1.01 above under the heading “Separation Agreement with Mr. Riesenbach,” which is also incorporated herein by reference. In connection with the termination of his employment, Mr. Riesenbach also resigned from his position as a member of the Board of Directors, effective December 11, 2008. There was no disagreement between Mr. Riesenbach and Autobytel at the time of his resignation from the Board.

Appointment of Mr. Coats as President and Chief Executive Officer

At the December 8th Board Meeting, the Board of Directors also appointed Mr. Jeffrey H. Coats, age 51, to the position of Autobytel’s President and Chief Executive Officer, effective December 11, 2008. Mr. Coats has served as a director of Autobytel since August 1996. Prior to his appointment as President and Chief Executive Officer, Mr. Coats served as Chairman of the Compensation Committee and as a member of the Audit Committee.

Mr. Coats is a partner of Southgate Alternative Investments, a diversified investment firm, since November 2007. He has also been an Executive Chairman of Mikronite Technologies Group Inc., an industrial technology company, since April 2007, having previously served as the company’s Chief Executive Officer, President and a director since February 2002. Prior to that, Mr. Coats was a Founder and Managing Director of TH Lee Global Internet Managers, L.P., a fund focused on making equity investments in eCommerce and Internet-related companies globally, where he remains a limited partner. Mr. Coats served as Managing Director of GE Equity, Inc., a wholly-owned subsidiary of General Electric Capital Corporation, from April 1996 to July 1999. He was a Founder and Managing Director of GE Capital’s Corporate Finance Restructuring Group from 1990 to 1993 and Region Manager and Managing Director of GE Capital’s Western United States Corporate Finance Group from 1989 to 1993. Mr. Coats serves on the Board of Directors of Congoleum Corporation, a resilient sheet and tile flooring company, and is a member of its Audit Committee and Restructuring Oversight Committee. He holds a B.B.A. in Finance from the University of Georgia and an M.B.A. in International Management from the American Graduate School of International Management.

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The terms of Mr. Coats’ employment with Autobytel as its President and Chief Executive Officer are described in Item 1.01 above under the heading “Employment Agreement with Mr. Coats,” which is incorporated herein by reference.

Resignation of Mr. Coats as Chair of Compensation Committee and Member of Audit Committee; Appointment of Ms. Thompson as Chairwoman of and Mr. Sitbel to Compensation Committee; Appointment of Ms. Thompson to Audit Committee

As a consequence of his appointment as Autobytel’s President and Chief Executive Officer, Mr. Coats resigned from his position as a member and Chairman of Autobytel’s Compensation Committee and from his position as a member of Autobytel’s Audit Committee, effective December 11, 2008. At the December 8th Board Meeting, the Board of Directors elected Janet Thompson to the position of Chairwoman of the Compensation Committee, appointed Jeffrey Stibel to the Compensation Committee and appointed Ms. Thompson to the Audit Committee, effective December 11, 2008. Ms. Thompson has been a director of Autobytel since March 2008 and Mr. Stibel has been a director of Autobytel since December 2006.

Appointment of New Titles for Existing Officers

At the December 8th Board Meeting, the Board of Directors also elected Mark A. Garms, a current employee and officer of Autobytel, to a new position at Autobytel, to be effective December 11, 2008. Mr. Garms, Autobytel’s Senior Vice President, Dealer Operations and Strategy, was appointed Senior Vice President and Chief Operating Officer. Mr. Garms, age 44, joined Autobytel as Director of Consumer Experience in February 2002, and was promoted to Vice President, Dealer Operations and Strategy in June 2004, Senior Vice President, Dealer Operations in September 2004 and Senior Vice President, Dealer Operations and Strategy in July 2005. Prior to joining Autobytel, Mr. Garms was Vice President of Client Services for SourceTrack (software), where he was responsible for client implementation and servicing from 2000 to 2001. Mr. Garms was with T. Rowe Price Services, the Baltimore based mutual fund company from October 1988 through December 1999, most recently as a Vice President and Department Manager, assisting in the start up of Customer Operations Centers in Tampa and Colorado Springs. Mr. Garms received a B.A. from Ambassador College.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

On December 8, 2008, the Board of Directors of Autobytel determined to amend, effective upon Mr. Reisenbach’s resignation from the Board, Section 3.02 of Article III of Autobytel’s Amended and Restated Bylaws to reduce the minimum number of authorized directors from six (6) to five (5) members and the maximum number of authorized directors from fourteen (14) to thirteen (13) members. The Board also fixed the number of directors within such range at six (6).

The foregoing description of the amendment to the Amended and Restated Bylaws is qualified in its entirety by reference to Amendment No. 5 to the Amended and Restated Bylaws of Autobytel, a copy of which is filed herewith as Exhibit 3.1 and incorporated herein by reference.

Item 8.01 Other Events.

On December 12, 2008, Autobytel also announced a workforce reduction of approximately 40 employees and issued a press release entitled “Autobytel Names New President and Chief Executive Officer,” a copy of which is filed herewith as Exhibit 99.1 and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

3.1	Amendment No. 5 to the Amended and Restated Bylaws of Autobytel Inc.
10.1	Employment Agreement between Autobytel and Mr. Coats
10.2	Amendment No. 1 to Employment Agreement between Autobytel and Mr. Riesenbach
10.3	Separation Agreement and Release between Autobytel and Mr. Riesenbach
10.4	Termination Letter to Mr. Riesenbach
99.1	Press release dated December 12, 2008

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Autobytel Inc.
By:	/s/ Glenn E. Fuller
	Glenn E. Fuller, Senior Vice President, Chief Legal and Administrative Officer and Secretary

Date: December 15, 2008

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INDEX TO EXHIBITS

Exhibit Number	Description
3.1	Amendment No. 5 to the Amended and Restated Bylaws of Autobytel Inc.
10.1	Employment Agreement between Autobytel and Mr. Coats
10.2	Amendment No. 1 to Employment Agreement between Autobytel and Mr. Riesenbach
10.3	Separation Agreement and Release between Autobytel and Mr. Riesenbach
10.4	Termination Letter to Mr. Riesenbach
99.1	Press release dated December 12, 2008

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EX-3.1

Exhibit 3.1

AMENDMENT NO. 5

TO THE

AMENDED AND RESTATED BYLAWS

OF

AUTOBYTEL INC.

A DELAWARE CORPORATION

Section 3.02 of Article III of the Amended and Restated Bylaws of Autobytel Inc. is hereby amended in its entirety to read as follows:

“Section 3.02 NUMBER. The authorized number of directors of the Corporation shall be between five (5) members and thirteen (13) members until changed by an amendment to this Section 3.02. Directors need not be stockholders of the Corporation.”

EX-10.1

Exhibit 10.1

Michael Fuchs

Chairman of the Board of Directors

December 11, 2008

Jeffrey H. Coats

18872 MacArthur Blvd.

Irvine, California 92612

Re: Employment Agreement

Dear Jeff:

This letter confirms the terms upon which Autobytel Inc., a Delaware corporation (“Company”) and you (“Executive”) have agreed regarding your employment as the Company’s Chief Executive Officer.

1. Employment. Effective as of the date of this letter (“Commencement Date”), the Company hereby employs Executive as the President and Chief Executive Officer of the Company, and the Executive hereby accepts such employment by the Company. Executive serves in the capacity as the Company’s President and Chief Executive Officer at the pleasure of the Company’s Board of Directors (“Board”). Executive’s employment is at will and not for a specified term and may be terminated by the Company or Executive at any time, with or without cause or good reason and with or without prior, advance notice. This “at-will” employment status will remain in effect throughout the term of Executive’s employment by the Company and cannot be modified except by a written amendment to this agreement executed by both parties that expressly negates the “at-will” employment status. Upon termination of Executive’s employment by either party, whether with or without cause or good reason, Executive will be entitled to receive that portion of Executive’s compensation, benefits, reimbursable expenses and other payments and benefits required by applicable law or the Company’s compensation and benefit plans and arrangements which had not been paid to Executive prior to the termination date.

2. Compensation, Benefits and Expenses.

(a) As compensation for the services to be rendered by Executive pursuant to this Agreement, the Company hereby agrees to pay Executive a base monthly salary (“Base Monthly Salary”) at a rate equal to Thirty -Five Thousand Dollars ($35,000.00) per month. The Base Monthly Salary shall be paid in substantially equal bimonthly installments, in accordance with the normal payroll practices of the Company. While employed by the Company, you will not receive any compensation for your service as a member of the Company’s Board or any of its committees.

(b) The Company agrees that Executive shall be entitled to all ordinary and customary benefits afforded generally to executive employees of the Company (except to the extent employee contribution may be required under the Company’s benefit plans as they may now or hereafter exist), which shall in no event be less than the benefits generally afforded to the other executive employees of the Company as of the date hereof or from time to time, but in any event shall include any qualified or non-qualified pension, profit sharing and savings plans, any death benefit and disability benefit plans, life insurance coverages, any medical, dental, health and welfare plans or insurance coverages and any stock purchase programs that are approved in writing by the Board, in its sole discretion.

December 11, 2008

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(c) The Company shall pay or reimburse Executive for all reasonable and authorized business expenses incurred by Executive while employed under this Agreement; such payment or reimbursement shall not be unreasonably withheld so long as said business expenses have been incurred for and promote the business of the Company and are normally and customarily incurred by employees in comparable positions at other comparable businesses in the same or similar market. As a condition to reimbursement under this Section 2(c), Executive shall furnish to the Company adequate records and other documentary evidence required by federal and state statutes and regulations for the substantiation of each expenditure. Executive acknowledges and agrees that failure to furnish the required documentation may result in the Company denying all or part of the expense for which reimbursement is sought.

(d) Executive is solely responsible for the payment of any tax liability that may result from any payments or benefits that Executive receives pursuant to this Agreement. The Company shall have the right to deduct or withhold from the compensation due to Executive hereunder any and all sums required for federal income and employee social security taxes and all state or local income taxes now applicable or that may be enacted and become applicable during Executive’s employment by the Company.

3. Standard Employee Agreements. Concurrently with the execution and delivery of this Agreement, Executive and Company have entered into the Company’s standard Employee Confidentiality Agreement and Mutual Agreement to Arbitrate in the forms attached hereto and which are hereby incorporated herein by reference (“Standard Employee Agreements”).

4. Entire Agreement. This Agreement, together with the Standard Employee Agreements, is intended to be the final, complete and exclusive agreement between the parties relating to the employment of Executive by the Company and all prior or contemporaneous understandings, representations and statements, oral or written, are merged herein. No modification, waiver, amendment, discharge or change of this Agreement shall be valid unless the same is in writing and signed by the party against which the enforcement thereof is or may be sought.

5. Governing Law. This Agreement shall be construed and enforced in accordance with the laws of the State of California, without giving effect to the principles of conflict of laws thereof.

Please confirm your agreement with the foregoing by signing and returning to the undersigned the duplicate copy of this Agreement enclosed herewith.

Autobytel Inc., a Delaware corporation
By:	/s/ Michael Fuchs
	Michael Fuchs
	Chairman of the Board of Directors

Accepted and Agreed

as of the date

first written above:

/s/ Jeffrey H. Coats

Jeffrey H. Coats

EX-10.2

Exhibit 10.2

EXECUTION VERSION

AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT

This Amendment No. 1 to Employment Agreement (this “Amendment No. 1”) is made and entered into as of December 10, 2008, by and between AUTOBYTEL INC., a Delaware corporation (the “Company”), and James E. Riesenbach (the “Executive”).

Recitals

WHEREAS, the Company and the Executive entered into that certain Employment Agreement, dated as of March 1, 2006 (the “Employment Agreement”); and

WHEREAS, the Company and the Executive desire to amend the Employment Agreement as set forth in this Amendment No. 1.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and with reference to the above recitals, the parties hereby agree as follows:

ARTICLE 1

AMENDMENTS

1.1 AMENDMENT TO SECTION 4.1. The last sentence of Section 4.1 of the Employment Agreement is deleted and replaced with the following:

“In addition, the Executive shall be reimbursed for up to $8,500 per year during the Term for tax and estate planning services upon submission of appropriate documentation to enable the Company to deduct such expenses (if otherwise deductible) subject to the Executive’s understanding that any reimbursements for expenses Executive incurs in a calendar year must be submitted for reimbursement by the Executive within thirty (30) days, and shall be reimbursed promptly, but no later than ninety (90) days after the Company receives such reimbursement request.”

1.2 AMENDMENT TO ARTICLE 5. Article 5 of the Employment Agreement shall be amended by adding a new Section 5.6, to read as follows:

“5.6 PAYMENT. Notwithstanding anything in this Agreement to the contrary, any reimbursements or other payments made under this Article 5 must be submitted for reimbursement by the Executive within thirty (30) days, and shall be reimbursed promptly, but no later than ninety (90) days after the Company receives such reimbursement request.”

1.3 AMENDMENT TO SECTION 6.2. Section 6.2 of the Employment Agreement shall be amended and restated in its entirety to read as follows:

“6.2 TERMINATION WITHOUT CAUSE OR GOOD REASON. Subject to Section 6.4, the Board acting for the Company shall have the right, at any time in its sole discretion, to terminate the Executive’s employment under this Agreement without Cause upon not less than thirty (30) days prior written notice to the Executive. The term “termination without Cause” shall mean the termination by the Company of the Executive’s employment for any reason other than those expressly set forth in Section 6.1, or no reason at all, and shall also

mean the Executive’s decision to terminate his employment under this Agreement (and he hereby has such right) by reason of any act, decision or omission by the Company or the Board that: (A) materially and adversely modifies, reduces, changes, or restricts the Executive’s salary, bonus opportunities, options or other compensation benefits or perquisites, or the Executive’s authority, functions, services, duties, rights, and privileges as, or commensurate with the Executive’s position as the President and Chief Executive Officer of the Company as described in Section 2.1; (B) relocates the Executive without his consent from the Company’s offices located at 18872 MacArthur Boulevard, Irvine, California, 92612-1400 to any other location in excess of fifty (50) miles beyond the geographic limits of Irvine, California; (C) deprives the Executive of his titles and positions of President and Chief Executive Officer; (D) if prior to the expiration of the Term results in the Company proffering a new employment agreement to the Executive in order to extend the Term and the terms and conditions of such agreement (i) as they relate to the Executive’s salary, bonus opportunity and benefits (assuming the Executive qualifies for such benefits) are not at least as favorable in all material respects to the Executive as the most favorable salary, bonus opportunity and benefits payable to the Executive in any year during the Term or (ii) materially and adversely change the Executive’s authority, functions, services, duties, rights and privileges as, or commensurate with the Executive’s position as the President and Chief Executive Officer as set forth in this Agreement; (E) results in the Executive not being elected to the Board as a Class II Director upon the Commencement Date and/or not being nominated by the Board to stand for election as a Class II Director at the 2006 annual meeting of the Company; (F) results in the Company not maintaining during the Term at least $20 million of liability insurance coverage for directors and officers unless the failure to obtain such insurance is unquestionably a result of any fact or circumstance relating to the Company occurring solely during the Term that is not caused by or results from a fact or circumstance occurring prior to the Commencement Date; or (G) involves or results in any material and adverse failure by the Company to comply with any material provision of this Agreement, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive (each a “Good Reason”). Notwithstanding anything herein, the Executive must give the Company notice of the condition that gives rise to the Good Reason within sixty (60) days of the occurrence of the condition, and the Company must have at least thirty (30) days to remedy the condition. In the event the Company or the Executive shall exercise the termination right granted pursuant to this Section 6.2, then except as set forth in the proviso below, neither party shall have any rights or obligations under Article 1, Article 2, Sections 3.1 and 3.2, or Articles 4 and 5; provided, however, that the Company shall pay to the Executive (a) an amount equal to twenty four (24) months of the Executive’s Base Salary (determined as the Executive’s highest annual Base Salary during the Term prior to such termination) plus two times the Bonus (at one hundred percent (100%) of the Executive’s highest annual Base Salary during the Term prior to such termination) and shall continue to provide all benefits that were non-taxable while the Executive was employed by the Company (or if not allowable under the Company’s then existing policies their substantial equivalents) in accordance with Article 4 at the time they would have been paid had the Executive remained an employee for a period of twenty four (24) months after the effective date of the termination (subject in each case to Section 3.3), except that the Company shall not be required to provide such benefits to the extent that, during such twenty four (24) month period, the Executive receives substantially similar (or better, from the Executive’s perspective) benefits from a new employer, and (b) any amount due and owing as of the

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termination date pursuant to Section 3.1, Section 3.2 (including a Bonus for the year in which the termination occurs (and if so provided the minimum required Bonus for such year pursuant to Section 3.2) prorated to the date of termination based on the performance of the Company in such year as of the date on which the termination occurs versus the performance targets for the Company established by the Board for the entire year in accordance with Section 3.2), Section 4.2 and Article 5 (subject, in each case, to Section 3.3), and the remaining provisions of this Agreement shall remain in full force and effect in accordance with their terms. The Executive shall inform the Company of any other benefits the Executive is receiving where the Company would have a right to reduce the benefits it is providing to the Executive. After the provision of the benefits during the two year period following such termination as described above, the Executive will be entitled to COBRA rights as provided by applicable law. The amounts and benefits required by clause (a) above shall be provided only if the Executive has executed and delivered to the Company (and not revoked) a release in favor of the Company (which release shall be substantially in the form attached as Exhibit B). The amounts payable pursuant to this Section 6.2 shall be in payment for the services rendered by the Executive pursuant to this Agreement during the Term, and the Executive shall not be entitled to any additional amounts in consideration for such services.”

1.4 AMENDMENT TO SECTION 7.1(b). Section 7.1(b) of the Employment Agreement shall be amended and restated in its entirety to read as follows:

“(b) The determinations of whether and when a Gross-Up Payment is required under this Article 7 shall be made by the Company based on its good faith interpretation of applicable law. The amount of such Gross-Up Payment and the valuation assumptions to be utilized in arriving at such determination shall be made by the Company which shall provide detailed supporting calculations to the Executive within 15 business days of the receipt of notice from the Executive that there has been a Payment subject to the Excise Tax, or such earlier time as is requested by the Company. Any Gross-Up Payment, as determined pursuant to this Article 7, shall be paid by the Company to the Executive within twenty-five (25) days of the receipt of notice from the Executive that there has been a Payment subject to the Excise Tax; provided, that the Gross-Up Payment shall be paid no later than the end of the Executive’s taxable year following the Executive’s taxable year in which the Executive remitted the Payment. Any determinations by the Company shall be binding upon the Executive, provided, however, if it is later determined that there has been an underpayment of Excise Tax and that the Executive is required to make an additional Excise Tax payment(s) on any Payment or Gross-Up Payment, the Company shall provide a similar full gross-up on such additional liability.”

ARTICLE 2

GENERAL PROVISIONS

2.1 CAPITALIZED TERMS. All capitalized terms in this Amendment No.1, to the extent not otherwise defined herein, shall have the meaning assigned to them in the Employment Agreement.

2.2 CONTINUING EFFECTIVENESS. Except as modified by this Amendment No. 1, the Employment Agreement shall remain in full force and effect and neither party by virtue of entering into this Amendment No. 1 is waiving any rights it has under the Employment Agreement, and once this Amendment No. 1 is executed by the parties hereto, all references in the Employment Agreement to “the Agreement” or “this Agreement,” as applicable, shall refer to the Employment Agreement as modified by this Amendment No. 1.

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2.3 SUCCESSORS. The terms and conditions of this Amendment No. 1 shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto.

2.4 GOVERNING LAW. This Amendment No. 1 shall be construed and enforced in accordance with the laws of the State of California, without giving effect to the principles of conflict of laws thereof.

2.5 COUNTERPARTS. This Amendment No. 1 may be executed in any number of counterparts, each of which shall be deemed an original, but all of which shall constitute one instrument.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of the date first above written.

AUTOBYTEL INC.
By:	/s/ Glenn E. Fuller
	Name:	Glenn E. Fuller
	Title:	Senior Vice President and Chief Legal Officer
JAMES E. RIESENBACH
/s/ James E. Riesenbach

[Signature Page to Amendment No. 1 to Employment Agreement]

EX-10.3

Exhibit 10.3

SEPARATION AGREEMENT AND RELEASE

It is hereby agreed by and between you, James E. Riesenbach (for yourself, your spouse, family, agents and attorneys) (jointly, “You”), and Autobytel Inc., its predecessors, successors, affiliates, directors, officers, shareholders, fiduciaries, insurers, employees and agents (jointly, the “Company”), as follows:

1. You acknowledge that your employment with the Company ended effective December 10, 2008, and that you will perform no further duties, functions or services for the Company subsequent to that date.

2. You acknowledge and agree that you have received all vacation pay and other compensation due you from the Company as a result of your employment with the Company and your separation from employment, including, but not limited to, all amounts required under your Employment Agreement with the Company dated March 1, 2006, as amended on December 10, 2008 (the “Employment Agreement”), other than those amounts payable pursuant to Paragraph 3 below and those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 or Article 7 of the Employment Agreement if required by the terms of such sections or article. You acknowledge and agree that the Company owes you no additional wages, commissions, bonuses, vacation pay, severance pay, expenses, fees, or other compensation or payments of any kind or nature, other than as provided in this Agreement and those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 or Article 7 of the Employment Agreement if required by the terms of such sections or article. All benefits for which you are eligible pursuant to the Employment Agreement will remain in effect for the periods set forth therein.

3. In exchange for your promises in this Agreement and the Employment Agreement, including the release of claims set forth below, if you (A) sign and do not revoke this Agreement and (B) you resign effective immediately from the Board of Directors of the Company, the Company will pay you all cash severance payments due to you under Section 6.2 of the Employment Agreement, minus legally required state and federal payroll deductions, within three (3) business days of the date all applicable revocation periods that you may have relating to this Separation Agreement and Release expire without you revoking this Separation Agreement and Release. All other payments due to you under Section 6.2 of the Employment Agreement, minus legally required state and federal payroll deductions, shall be paid to you in the time periods required by the Employment Agreement. You and the Company have and will continue to take consistent positions in each party’s reasonable tax reporting in respect of Section 409A of the Internal Revenue Code of 1986 (the “Code”) as applied to payments to be made to you under the Employment Agreement. You are still liable for all taxes and penalties arising under Section 409A of the Code, if any, that may result from any payments or benefits that you receive pursuant to the Employment Agreement. Accordingly, if there is any liability for tax pursuant to Section 409A of the Code, it shall be your sole responsibility and liability for all such taxes and penalties and you agree to indemnify and hold the Company harmless from any liability the Company may incur for not reporting or withholding taxes under Section 409A of the Code or any similar state or local law in connection with the payments and benefits under this Separation Agreement and Release or the Employment Agreement. In connection with entering into the Employment Agreement you were represented by independent counsel and tax advisors. The Company has not and is not now advising you in respect of any tax applicable to payment due to you under the Employment Agreement.

4. You represent and warrant that you have returned to the Company any and all documents, software, equipment (including, but not limited to, computers and computer-related items), and all other materials or other things in your possession, custody, or control which are the property of the Company, including, but not limited to, Company identification, keys, and the like, wherever such items may have been located; as well as all copies (in whatever form thereof) of all materials relating to your employment, or obtained or created in the course of your employment with the Company.

5. You hereby represent that, other than those materials you have returned to the Company pursuant to Paragraph 4 of this Agreement, you have not copied or caused to be copied, and have not printed-out or caused to be printed-out, any software, computer disks, or other documents other than those documents generally available to the public, or retained any other materials originating with or belonging to the Company. You further represent that you have not retained in your possession, custody or control, any software, documents or other materials in machine or other readable form, which are the property of the Company, originated with the Company, or were obtained or created in the course of or relate to your employment with the Company.

6. You shall keep confidential, and shall not hereafter use or disclose to any person, firm, corporation, governmental agency, or other entity, in whole or in part, at any time in the future, any trade secret, proprietary information, or confidential information of the Company, including, but not limited to, information relating to trade secrets, processes, methods, pricing strategies, customer lists, marketing plans, product introductions, advertising or promotional programs, sales, financial results, financial records and reports, regulatory matters and compliance, and other confidential matters, except as required by law and as necessary for compliance purposes. These obligations are in addition to the obligations set forth in Article 8 of the Employment Agreement which shall remain binding on you.

7. You agree that you have not and will not at any time reveal to anyone, including any former, present or future employee of the Company, the fact, amount, or the terms of this Agreement, except to your immediate family, legal counsel and financial advisor, or as required by law and as necessary for compliance purposes. The Company may disclose the terms of this Agreement and file this Agreement as an exhibit to its public filings if it is required to due so under applicable law or as necessary for compliance purposes.

8. In consideration for the payment provided for in Paragraph 3, you unconditionally release and forever discharge the Company, and the Company’s current, former, and future controlling shareholders, subsidiaries, affiliates, related companies, predecessor companies, divisions, directors, trustees, officers, employees, agents, attorneys, successors, and assigns (and the current, former, and future controlling shareholders, directors, trustees, officers, employees, agents, and attorneys of such subsidiaries, affiliates, related companies, predecessor companies, and divisions) (referred to collectively as “Releasees”), from any and all known and unknown claims, demands, actions, suits, causes of action, obligations, damages and liabilities of whatever

kind or nature and regardless of whether the knowledge thereof would have materially affected your agreement to release the Company hereunder, that arise out of or are related to (a) the Company’s failure to make any payments required under the Employment Agreement (other than those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 and Article 7 of the Employment Agreement if required by the terms of such sections), and (b) those arising under the Age Discrimination in Employment Act (“ADEA”). The Release will not waive the Executive’s rights to indemnification under the Company’s certificate of incorporation or by-laws or any written agreement between the Company and the Executive relating to the Executive’s service on the Board of the Company.

With respect to the various rights and claims under the ADEA being waived by you in this Agreement, you specifically acknowledge that you have read and understand the provisions of paragraphs 12, 13, and 14 below before signing this Agreement. This general release does not cover rights or claims under the ADEA arising after you sign this Agreement.

9. You represent and warrant that you have not filed, and agree that you will not file, or cause to be filed, any complaint, charge, claim or action involving any claims you have released in the foregoing paragraph. This promise not to sue does not apply to claims for breach of this Agreement. You agree and acknowledge that if you break this promise not to sue (other than with respect to a claim under the ADEA that you have released), then you will be liable for all consequential damages, including the legal expenses and fees incurred by the Company or any of the Releasees, in defending such a claim.

10. The Company hereby represents and warrants that concurrently with your execution and delivery of this Agreement, the Company has paid to you any and all amounts under the Employment Agreement that are required to be paid to you by the Company as of the date hereof, excluding, without limitation, any amounts required to be paid under this Agreement and those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 or Article 7 of the Employment Agreement if and to the extent required by the terms of such sections.

11. Excluded from this Agreement are any claims or rights that cannot be waived by law, including the right to file a charge of discrimination with an administrative agency. You agree, however, to waive your right to any monetary recovery in connection with such a charge.

12. You are advised to consult with an attorney before you sign this Agreement. You understand that you have twenty-one (21) days within which to decide whether to sign this Agreement, although you may sign this Agreement at any time within the twenty-one (21) day period. If you do sign it, you also understand that you will have an additional 7 days after you sign to change your mind and revoke the Agreement, in which case a written notice of revocation must be delivered to Vice President Human Resources or comparable title, Autobytel Inc., 18872 MacArthur Blvd., Irvine, California 92612-1400, on or before the seventh (7th) day after your execution of the Agreement. You understand that the Agreement will not become effective until after that seven (7) day period has passed.

13. You acknowledge that you are signing this Agreement knowingly and voluntarily and intend to be bound legally by its terms.

14. You hereby acknowledge that no promise or inducement has been offered to you, except as expressly stated above and in the Employment Agreement, and you are relying upon none. This Agreement and the Employment Agreement represent the entire agreement between you and the Company with respect to the subject matter hereof, and supersede any other written or oral understandings between the parties pertaining to the subject matter hereof and may only be amended or modified with the prior written consent of you and the Company.

15. You certify that you have not experienced a job-related illness or injury for which you have not already filed a claim.

16. If any provision of this Agreement is held to be invalid, the remainder of the Agreement, nevertheless, shall remain in full force and effect in all other circumstances.

17. This Agreement does not constitute an admission that the Company or any other Releasee has violated any law, rule, regulation, contractual right or any other duty or obligation.

18. This Agreement is made and entered into in the State of California and shall in all respects be interpreted, enforced, and governed under the law of that state, without reference to conflict of law provisions thereof. The language of all parts in this Agreement shall be construed as a whole, according to fair meaning, and not strictly for or against any party.

PLEASE READ CAREFULLY. THIS AGREEMENT INCLUDES THE RELEASE OF CERTAIN CLAIMS.

Dated: December 11, 2008	By:	/s/ James E. Riesenbach
		Name: James E. Riesenbach
Dated: December 11, 2008	AUTOBYTEL INC.
	By:	/s/ Glenn E. Fuller
		Name: Glenn E. Fuller
		Title: Senior Vice President and Chief Legal Officer

[Signature Page to Separation Agreement and Release (Riesenbach)]

EX-10.4

Exhibit 10.4

Autobytel Inc.

18872 MacArthur Boulevard

Irvine, California 92612-1400

December 10, 2008

James E. Riesenbach

c/o Sandra Bloch, Esq.

Cozen O’Connor

1900 Market Street

Philadelphia, PA 19103

Re: Termination of Employment

Dear Mr. Riesenbach:

Reference is hereby made to that certain Employment Agreement, by and between you and Autobytel Inc., a Delaware corporation (the “Company”), dated as of March 1, 2006, as amended on December 10, 2008 (the “Employment Agreement”).

Pursuant to Section 6.2 of the Employment Agreement, the Board of Directors of the Company hereby gives you notice of the Company’s election to terminate your employment without Cause (as defined in the Employment Agreement), effective immediately. The Company also hereby requires your resignation from the Board of Directors of the Company and all other boards of subsidiaries of the Company in each case effective immediately.

Under the provisions of your Employment Agreement, upon your execution and delivery to the Company of a separation and release in favor of the Company (a copy of which is attached) without revocation thereof and your resignation from the Board of Directors, you will be eligible to receive severance benefits from the Company on the terms and as set forth in Section 6.2 of the Employment Agreement, subject to standard deductions and withholdings.

Pursuant to Section 9.11 of your Employment Agreement you are solely responsible for the payment of any tax liability (including any taxes and penalties arising under Section 409A of the Internal Revenue Code of 1986, as amended), if any, that may result from any payments or benefits that you receive pursuant to your Employment Agreement.

Should you have any questions, please contact Thomas Pollock of Paul, Hastings, Janofsky & Walker LLP, outside counsel to the Company at (415) 856-7047.

Sincerely,

AUTOBYTEL INC.
By:	/s/ Michael Fuchs
Name:	Michael Fuchs
Title:	Chairman of the Board

SEPARATION AGREEMENT AND RELEASE

It is hereby agreed by and between you, James E. Riesenbach (for yourself, your spouse, family, agents and attorneys) (jointly, “You”), and Autobytel Inc., its predecessors, successors, affiliates, directors, officers, shareholders, fiduciaries, insurers, employees and agents (jointly, the “Company”), as follows:

1. You acknowledge that your employment with the Company ended effective December 10, 2008, and that you will perform no further duties, functions or services for the Company subsequent to that date.

2. You acknowledge and agree that you have received all vacation pay and other compensation due you from the Company as a result of your employment with the Company and your separation from employment, including, but not limited to, all amounts required under your Employment Agreement with the Company dated March 1, 2006, as amended on December 10, 2008 (the “Employment Agreement”), other than those amounts payable pursuant to Paragraph 3 below and those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 or Article 7 of the Employment Agreement if required by the terms of such sections or article. You acknowledge and agree that the Company owes you no additional wages, commissions, bonuses, vacation pay, severance pay, expenses, fees, or other compensation or payments of any kind or nature, other than as provided in this Agreement and those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 or Article 7 of the Employment Agreement if required by the terms of such sections or article. All benefits for which you are eligible pursuant to the Employment Agreement will remain in effect for the periods set forth therein.

3. In exchange for your promises in this Agreement and the Employment Agreement, including the release of claims set forth below, if you (A) sign and do not revoke this Agreement and (B) you resign effective immediately from the Board of Directors of the Company, the Company will pay you all cash severance payments due to you under Section 6.2 of the Employment Agreement, minus legally required state and federal payroll deductions, within three (3) business days of the date all applicable revocation periods that you may have relating to this Separation Agreement and Release expire without you revoking this Separation Agreement and Release. All other payments due to you under Section 6.2 of the Employment Agreement, minus legally required state and federal payroll deductions, shall be paid to you in the time periods required by the Employment Agreement. You and the Company have and will continue to take consistent positions in each party’s reasonable tax reporting in respect of Section 409A of the Internal Revenue Code of 1986 (the “Code”) as applied to payments to be made to you under the Employment Agreement. You are still liable for all taxes and penalties arising under Section 409A of the Code, if any, that may result from any payments or benefits that you receive pursuant to the Employment Agreement. Accordingly, if there is any liability for tax pursuant to Section 409A of the Code, it shall be your sole responsibility and liability for all such taxes and penalties and you agree to indemnify and hold the Company harmless from any liability the Company may incur for not reporting or withholding taxes under Section 409A of the Code or any similar state or local law in connection with the payments and benefits under this Separation Agreement and Release or the Employment Agreement. In connection with entering into the Employment Agreement you were represented by independent counsel and tax advisors. The Company has not and is not now advising you in respect of any tax applicable to payment due to you under the Employment Agreement.

4. You represent and warrant that you have returned to the Company any and all documents, software, equipment (including, but not limited to, computers and computer-related items), and all other materials or other things in your possession, custody, or control which are the property of the Company, including, but not limited to, Company identification, keys, and the like, wherever such items may have been located; as well as all copies (in whatever form thereof) of all materials relating to your employment, or obtained or created in the course of your employment with the Company.

5. You hereby represent that, other than those materials you have returned to the Company pursuant to Paragraph 4 of this Agreement, you have not copied or caused to be copied, and have not printed-out or caused to be printed-out, any software, computer disks, or other documents other than those documents generally available to the public, or retained any other materials originating with or belonging to the Company. You further represent that you have not retained in your possession, custody or control, any software, documents or other materials in machine or other readable form, which are the property of the Company, originated with the Company, or were obtained or created in the course of or relate to your employment with the Company.

6. You shall keep confidential, and shall not hereafter use or disclose to any person, firm, corporation, governmental agency, or other entity, in whole or in part, at any time in the future, any trade secret, proprietary information, or confidential information of the Company, including, but not limited to, information relating to trade secrets, processes, methods, pricing strategies, customer lists, marketing plans, product introductions, advertising or promotional programs, sales, financial results, financial records and reports, regulatory matters and compliance, and other confidential matters, except as required by law and as necessary for compliance purposes. These obligations are in addition to the obligations set forth in Article 8 of the Employment Agreement which shall remain binding on you.

7. You agree that you have not and will not at any time reveal to anyone, including any former, present or future employee of the Company, the fact, amount, or the terms of this Agreement, except to your immediate family, legal counsel and financial advisor, or as required by law and as necessary for compliance purposes. The Company may disclose the terms of this Agreement and file this Agreement as an exhibit to its public filings if it is required to due so under applicable law or as necessary for compliance purposes.

8. In consideration for the payment provided for in Paragraph 3, you unconditionally release and forever discharge the Company, and the Company’s current, former, and future controlling shareholders, subsidiaries, affiliates, related companies, predecessor companies, divisions, directors, trustees, officers, employees, agents, attorneys, successors, and assigns (and the current, former, and future controlling shareholders, directors, trustees, officers, employees, agents, and attorneys of such subsidiaries, affiliates, related companies, predecessor companies, and divisions) (referred to collectively as “Releasees”), from any and all known and unknown claims, demands, actions, suits, causes of action, obligations, damages and liabilities of whatever

kind or nature and regardless of whether the knowledge thereof would have materially affected your agreement to release the Company hereunder, that arise out of or are related to (a) the Company’s failure to make any payments required under the Employment Agreement (other than those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 and Article 7 of the Employment Agreement if required by the terms of such sections), and (b) those arising under the Age Discrimination in Employment Act (“ADEA”). The Release will not waive the Executive’s rights to indemnification under the Company’s certificate of incorporation or by-laws or any written agreement between the Company and the Executive relating to the Executive’s service on the Board of the Company.

With respect to the various rights and claims under the ADEA being waived by you in this Agreement, you specifically acknowledge that you have read and understand the provisions of paragraphs 12, 13, and 14 below before signing this Agreement. This general release does not cover rights or claims under the ADEA arising after you sign this Agreement.

9. You represent and warrant that you have not filed, and agree that you will not file, or cause to be filed, any complaint, charge, claim or action involving any claims you have released in the foregoing paragraph. This promise not to sue does not apply to claims for breach of this Agreement. You agree and acknowledge that if you break this promise not to sue, then you will be liable for all consequential damages, including the legal expenses and fees incurred by the Company or any of the Releasees, in defending such a claim.

10. The Company hereby represents and warrants that concurrently with your execution and delivery of this Agreement, the Company has paid to you any and all amounts under the Employment Agreement that are required to be paid to you by the Company as of the date hereof, excluding, without limitation, any amounts required to be paid under this Agreement and those amounts, if any, payable pursuant to Sections 3.5, 5.1, 5.2 and 5.3 or Article 7 of the Employment Agreement if and to the extent required by the terms of such sections.

11. Excluded from this Agreement are any claims or rights that cannot be waived by law, including the right to file a charge of discrimination with an administrative agency. You agree, however, to waive your right to any monetary recovery in connection with such a charge.

12. You acknowledge that you have hereby been advised in writing to consult with an attorney before you sign this Agreement. You understand that you have twenty-one (21) days within which to decide whether to sign this Agreement, although you may sign this Agreement at any time within the twenty-one (21) day period. If you do sign it, you also understand that you will have an additional 7 days after you sign to change your mind and revoke the Agreement, in which case a written notice of revocation must be delivered to Vice President Human Resources or comparable title, Autobytel Inc., 18872 MacArthur Blvd., Irvine, California 92612-1400, on or before the seventh (7th) day after your execution of the Agreement. You understand that the Agreement will not become effective until after that seven (7) day period has passed.

13. You acknowledge that you are signing this Agreement knowingly and voluntarily and intend to be bound legally by its terms.

14. You hereby acknowledge that no promise or inducement has been offered to you, except as expressly stated above and in the Employment Agreement, and you are relying upon none. This Agreement and the Employment Agreement represent the entire agreement between you and the Company with respect to the subject matter hereof, and supersede any other written or oral understandings between the parties pertaining to the subject matter hereof and may only be amended or modified with the prior written consent of you and the Company.

15. You certify that you have not experienced a job-related illness or injury for which you have not already filed a claim.

16. If any provision of this Agreement is held to be invalid, the remainder of the Agreement, nevertheless, shall remain in full force and effect in all other circumstances.

17. This Agreement does not constitute an admission that the Company or any other Releasee has violated any law, rule, regulation, contractual right or any other duty or obligation.

18. This Agreement is made and entered into in the State of California and shall in all respects be interpreted, enforced, and governed under the law of that state, without reference to conflict of law provisions thereof. The language of all parts in this Agreement shall be construed as a whole, according to fair meaning, and not strictly for or against any party.

PLEASE READ CAREFULLY. THIS AGREEMENT INCLUDES THE RELEASE OF CERTAIN CLAIMS.

Dated: December     , 2008	By:
		Name: James E. Riesenbach
Dated: December     , 2008	AUTOBYTEL INC.
	By:
		Name:
		Title:

EX-99.1

Exhibit 99.1

Autobytel Names New President and Chief Executive Officer

Page 1 of 3

AUTOBYTEL NAMES NEW PRESIDENT AND CHIEF EXECUTIVE OFFICER

Workforce Reduced by 25 Percent

Irvine, CA — December 12, 2008 — Autobytel Inc. (NASDAQ: ABTL) today announced that Jeffrey H. Coats, a director of the company, was named President and Chief Executive Officer effective December 11, 2008.

Coats, 51, has served on Autobytel’s Board since August 1996. He is a partner of Southgate Alternative Investments, a diversified investment firm, since November 2007. Mr. Coats has also been an Executive Chairman of Mikronite Technologies Group Inc., an industrial technology company, since April 2007, having previously served as the company’s Chief Executive Officer, President and a director since February 2002. Prior to that, he was a Founder and Managing Director of TH Lee Global Internet Managers, L.P., a fund focused on making equity investments in eCommerce and Internet-related companies globally, where he remains a limited partner. Coats served as Managing Director of GE Equity, Inc., a wholly-owned subsidiary of General Electric Capital Corporation, from April 1996 to July 1999. He was a Founder and Managing Director of GE Capital’s Corporate Finance Restructuring Group from 1990 to 1993 and Region Manager and Managing Director of GE Capital’s Western United States Corporate Finance Group from 1989 to 1993. Coats serves on the Board of Directors of Congoleum Corporation, a resilient sheet and tile flooring company, and is a member of its Audit Committee and Restructuring Oversight Committee. He holds a B.B.A. in Finance from the University of Georgia and an M.B.A. in International Management from the American Graduate School of International Management.

Given his new position with Autobytel, Coats has resigned from the Audit and Compensation Committees of the company’s Board of Directors, but will remain as a director. Janet Thompson, a director of the company, has been appointed to the Audit and Compensation Committees and will act as Chairwoman of the Compensation Committee, and Jeffrey Stibel, a director of the company, has been appointed to the Compensation Committee. Mr. Coats replaces Mr. Riesenbach as CEO. Mr. Riesenbach has left the company and has resigned as a member of the company’s Board of Directors.

In light of new duties and responsibilities being undertaken as a result of the workforce reduction, Mark Garms, the company’s Senior Vice President, Dealer Operations and Strategy, was promoted to the newly created position of Senior Vice President and Chief Operating Officer. Mr. Garms has been with Autobytel for approximately seven years, serving in various capacities during such time. In addition, Curtis DeWalt, the company’s Vice President and Controller, was promoted to Senior Vice President, Finance and Controller; Glenn Fuller, the company’s Senior Vice President, Chief Legal Officer and Secretary, was promoted to Senior Vice President, Chief Legal and Administrative Officer and Secretary; and Lawrence Brogan, the company’s Vice President, Financial Planning & Analysis, was promoted to Senior Vice President, Strategic and Financial Planning.

Autobytel also announced that it has implemented an additional workforce reduction of approximately 40 employees, or 25% of its workforce. Autobytel anticipates that as a result of this action, the company will generate savings of approximately $5.2 million on an annual basis. The company expects to record a charge related to severance and other employee-related costs totaling approximately $4.5 million in the 4^th quarter, inclusive of a severance payment to Mr. Riesenbach.

Michael Fuchs, Chairman of Autobytel’s Board of Directors, said, “Autobytel is continuing to take immediate steps to bring its costs in line with anticipated revenues. The Board believes these actions are necessary and appropriate to further stabilize the company. The additional workforce reduction announced today should allow the company to more quickly reach its goal of achieving cash flow break even. Additionally, the appointment of Jeff as Autobytel’s new CEO and the promotion of Mark to COO, underscores the Board’s focus on immediately improving the company’s operating results and signals the Board’s confidence in the company’s ability to execute on its business plan in this turbulent economic environment.”

“I look forward to working with the management team to successfully implement our business plan,” said Coats. “The management team and Board are extremely focused on achieving immediate improvement in the company’s operating results. We are committed to increasing shareholder value.”

The company said it is continuing to pursue strategic alternatives through RBC Capital Markets, as previously announced.

About Autobytel Inc.

Autobytel Inc. (Nasdaq:ABTL) is an Internet automotive marketing services company that helps dealers and manufacturers sell cars and related products and services. The company owns and operates several consumer-facing automotive websites, including Autobytel.com^®, AutoSite.com^®, Autoweb.com^®, Car.com^sm, CarSmart.com^®CarTV.com^® and MyRide.com^®. By providing a convenient and comprehensive automotive consumer experience across the purchase and ownership lifecycle, Autobytel seeks to provide dealerships with opportunities to connect with a steady, diverse stream of motivated, serious shoppers, while providing manufacturers with precision-targeted brand and product advertising opportunities. In addition to its websites, the company generates leads and advertising opportunities for dealers and automakers through its marketing network, which includes the AutoReach ad network, co-brands, such as ESPN.com, and marketing affiliates such as AOL, Edmunds and Kelly Blue Book.

Forward-Looking Statement Disclaimer

The statements contained in this press release that are not historical facts are forward-looking statements under the federal securities laws. These forward-looking statements are not guarantees of future performance and involve certain assumptions and certain risks and uncertainties that are difficult to predict. Actual outcomes and results may differ materially from what is expressed in, or implied by, such forward-looking statements. Autobytel undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ materially from those expressed in, or implied by, the forward-looking statements are changes in general economic conditions, the economic impact of terrorist attacks or military actions, increased dealer attrition, pressure on dealer fees, increased or unexpected competition, the failure of new products and services to meet expectations, failure to retain key employees or attract and integrate new employees, that actual costs and expenses exceed the charges taken by Autobytel, changes in laws and regulations, costs of legal matters, including, defending lawsuits and undertaking investigations and related matters, and other matters disclosed in Autobytel’s filings with the Securities and Exchange Commission. Investors are strongly encouraged to review our Annual Report on Form 10-K for the year ended December 31, 2007 and other filings with the Securities and Exchange Commission for a discussion of risks and uncertainties that could affect operating results and the market price of our stock.

# # #

Contacts:

Media Relations

Autobytel Inc.

Crystal Hartwell, 949-437-4755

crystalh@autobytel.com

Investor Relations

Autobytel Inc.

Crystal Hartwell, 949-437-4755

crystalh@autobytel.com

or

PondelWilkinson Inc.

Roger Pondel/Laurie Berman, 310-279-5980

investor@pondel.com