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Employment Agreement - Rentrak Corp. and Kenneth M. Papagan

Employment Forms

  • Employment Agreement. Employers can customize an employment agreement that states the salary, benefits, working hours and other important provisions for their new or existing employee.
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  • Sales Representative Contract. Independent sales representatives offer companies the potential to increase the sale of products or services without the burden of increasing headcount. Both parties should understand how commissions are calculated, when commissions will be paid, as well as how the representative will treat confidential information from the company and whether the representative may also sell a competing line of products or services.
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                              EMPLOYMENT AGREEMENT


     This Employment  Agreement is entered into as of November 18, 2002, between
KENNETH M. PAPAGAN ("Executive") and RENTRAK CORPORATION,  an Oregon corporation
("Corporation").

1. SERVICES

     1.1  Employment  Position.   Corporation  agrees  to  employ  Executive  as
Executive  Vice President - New Business and Strategic  Planning,  and Executive
accepts  such  employment,  under the terms and  conditions  of this  Agreement.
Executive also agrees to serve, if elected, without separate compensation,  as a
director of  Corporation  and an officer  and/or  director of any  subsidiary or
affiliate of Corporation.  In the event that the Corporation pays directors fees
to other  directors who are also officers of Corporation,  Corporation  will pay
directors  fees to  Executive  on the  same  basis.  Corporation  represents  to
Executive  that it  currently  has and  will  maintain  directors  and  officers
liability insurance.

     1.2 Term.

          1.2.1  Initial  Term.  The term of this  Agreement  (the  "Term") will
     commence on November 18, 2002, and will expire December 31, 2003.

          1.2.2 Subsequent  Terms. On or before  September 1, 2003,  Corporation
     and  Executive  mutually  agree to enter into  negotiations  concerning  an
     extension of the Term or of this Agreement or the terms of a new employment
     agreement with a term commencing January 1, 2004. The extension of the Term
     beyond  December 31, 2003, will require the mutual approval of both parties
     as to the terms of such extension, including Executive's title, duties, and
     overall  compensation.  In the event that,  prior to the  expiration of the
     Term, Corporation and Executive are not able to reach agreement for such an
     extension,  Executive  will be entitled to severance  payments  pursuant to
     Section 6.2.1(b).

     1.3 Duties.  During the Term, Executive will serve in an executive capacity
as the Executive Vice President - New Business and Strategic Planning. Executive
will report directly to Corporation's Chief Executive Officer. Executive will be
responsible for new business  development and strategic  planning and such other
or different  duties on behalf of  Corporation  as may be assigned  from time to
time  by  Corporation's  Chief  Executive  Officer  or  Corporation's  Board  of
Directors (the "Board").  Executive will do such traveling as may be required in
the performance of his duties under this Agreement.

     1.4 Outside  Activities.  Except as  expressly  provided  in this  Section,
during his  employment  under this  Agreement,  Executive  will  devote his full
business  time,  energies,   and  attention  to  the  business  and  affairs  of
Corporation,  and to the promotion and  advancement of its interests.  Executive
will  perform  his  services  faithfully,  competently,  and to the  best of his
abilities and will not engage in  professional or personal  business  activities
that may require an  appreciable  portion of  Executive's  time or effort to the
detriment of Corporation's  business. For a transition period of six months from
the date of this  Agreement,  Executive  may  continue to list


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himself as CEO of MeSoft  Partners  and as President  of DelMar  Media.Net  (the
"Prior  Companies")  and may devote up to 10 hours per month in connection  with
Prior  Companies  and  other  consulting   activities  provided  that  (i)  such
activities  do not violate the  noncompetition  provisions  of Section 4 of this
Agreement and (ii) such services will not interfere with Executive's performance
of his duties for Corporation.

     1.5 Application of Corporate Policies.  Executive will, except as otherwise
provided in this Agreement,  be subject to Corporation's rules,  practices,  and
policies applicable generally to Corporation's  senior executive  employees,  as
such rules,  practices,  and  policies  may be revised  from time to time by the
Board.

2. COMPENSATION AND EXPENSES

     2.1 Base  Salary.  As  compensation  for  services  under  this  Agreement,
Corporation will pay to Executive a base salary of $225,000 per year, payable in
a  manner  consistent  with  Corporation's   payroll  practices  for  management
employees, as such practices may be revised from time to time. (In no event will
Executive's base salary be payable less often than monthly.)

     2.2 Bonus  Compensation.  For the Term of this Agreement  (through December
31, 2003), subject to the provisions of Section 6 of this Agreement, Corporation
will pay  Executive  a bonus in an  amount  determined  by  Corporation's  Chief
Executive  Officer,  after  consultation  with the Committee,  in his discretion
based on Executive's contributions to Corporation;  provided, however, that such
bonus  will not be less than  $60,000.  Such  bonus will be payable on or before
February  15,  2004 (and the  obligation  to pay such  bonus  will  survive  the
expiration of the Term).

     2.3 Stock Options.

          2.3.1 General. Executive will participate, together with Corporation's
     other senior executives,  in Corporation's  1997 Equity  Participation Plan
     (the  "Plan").  Executive  will be granted  options to  purchase  shares of
     Corporation's  common stock and/or other awards under the Plan at the times
     and in the amounts determined by the Committee. All options will be subject
     to the provisions of the Plan.

          2.3.2  Initial  Grant.  Effective  as of the  date of this  Agreement,
     Executive will be granted a combination of an incentive  stock option and a
     nonqualified  stock  option to purchase an  aggregate  of 75,000  shares of
     Corporation's  common stock with an exercise price equal to the fair market
     value of the stock on the date of the  grant,  subject to the  vesting  and
     other provisions set forth in award agreements in the form attached to this
     Agreement as Appendix 2.3.2.

     2.4 Additional  Employee Benefits Executive will receive an annual grant of
208  hours of  credit  (or such  higher  number  of  hours  as are  credited  to
Corporation's  other senior  executives) under  Corporation's  Personal Time Off
(PTO)  program.  Personal time off and vacation may be taken in accordance  with
Corporation's rules, practices,  and policies applicable to Corporation's senior
executive employees, as such rules, practices,  and policies may be revised from
time to time by the Board or the Committee.  During the Term,  Executive will be
entitled to any other employee  benefits approved by the Board or the Committee,
or available to officers and other management employees generally, including any
life and medical insurance


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<PAGE>

plans,  401(k) and other  similar  plans,  and health and  welfare  plans,  each
whether  now  existing  or  hereafter  approved  by the  Board or the  Committee
("Benefit Plans"). The foregoing will not be construed to require Corporation to
establish any such plans or to prevent Corporation from modifying or terminating
any such Benefit Plans.

     2.5 Expenses.  Corporation will reimburse Executive for reasonable expenses
actually  incurred by Executive in connection  with the business of Corporation.
Executive will submit to Corporation  such  substantiation  for such expenses as
may be  reasonably  required by  Corporation.  In  connection  with  Executive's
commencement of employment,  Corporation will reimburse Executive for (a) moving
expenses to Portland (up to $5,000), (b) up to $4,000 for transition  automobile
expense,  (c) up to 45 days  temporary  lodging at the Portland  Embassy  Suites
Hotel, and (d) up to $5,000 for attorney's fees.

3. CONFIDENTIAL INFORMATION

     3.1 Definition.  "Confidential  Information"  is all nonpublic  information
relating to  Corporation  or its business that is disclosed to  Executive,  that
Executive  produces,  or that Executive  otherwise  obtains  during  employment.
Confidential  Information also includes  information received from third parties
that  Corporation has agreed to treat as  confidential;  provided that Executive
has  knowledge  that  Corporation  has  agreed  to  treat  such  information  as
confidential.  Examples of Confidential Information include, without limitation,
marketing plans,  customer lists or other customer  information,  product design
and  manufacturing   information,   and  financial   information.   Confidential
Information  does not  include  any  information  that (i) is within  the public
domain  other than as a result of  disclosure  by Executive in violation of this
Agreement,  (ii) was, on or before the date of disclosure to Executive,  already
known  by  Executive,  or  (iii)  Executive  is  required  to  disclose  in  any
governmental,  administrative,  judicial, or quasi-judicial proceeding, but only
to the extent  that  Executive  is so required to  disclose  and  provided  that
Executive  takes  reasonable  steps to request  confidential  treatment  of such
information in such proceeding.

     3.2 Access to Information. Executive acknowledges that in the course of his
employment  he  will  have  access  to  Confidential   Information,   that  such
information  is a valuable  asset of  Corporation,  and that its  disclosure  or
unauthorized use will cause Corporation substantial harm.

     3.3 Ownership.  Executive  acknowledges  that all Confidential  Information
will continue to be the exclusive  property of  Corporation  (or the third party
that disclosed it to  Corporation),  whether or not prepared in whole or in part
by  Executive  and whether or not  disclosed  to  Executive  or entrusted to his
custody in connection with his employment by Corporation.

     3.4 Nondisclosure and Nonuse. Unless authorized or instructed in advance in
writing by  Corporation,  or required by law (as  determined  by licensed  legal
counsel or judicial or  quasi-judicial  order),  Executive  will not,  except as
required  in  the  course  of  Corporation's  business,   during  or  after  his
employment,  disclose to others or use any Confidential Information,  unless and
until,  and then only to the extent  that,  such items  become  available to the
public through no fault of Executive.


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<PAGE>

     3.5 Return of Confidential Information.  Upon request by Corporation during
or after his  employment,  and without  request upon  termination  of employment
pursuant to this  Agreement,  Executive will deliver  immediately to Corporation
all  written,   stored,   saved,  or  otherwise  tangible  materials  containing
Confidential Information without retaining any excerpts or copies.

     3.6  Duration.  The  obligations  set forth in this Section 3 will continue
beyond the term of  employment  of Executive by  Corporation  and for so long as
Executive possesses Confidential Information.

4. NONCOMPETITION

     4.1  Competitive  Entity.  For purposes of this  Agreement,  a  Competitive
Entity  is  any  firm,  corporation,  partnership,  limited  liability  company,
business  trust,  or other entity that is engaged in all or any of the following
business activities:

          (a) The  wholesale  and/or  revenue  sharing  physical  or  electronic
     distribution of home entertainment software in any media, including without
     limitation   video   cassettes,   DVDs,   video   games  and  PC   software
     ("Entertainment Software");

          (b) The fulfillment, warehouse, or distributing business in connection
     with the Entertainment Software industry;

          (c) The collection,  aggregation, tracking and dissemination of market
     information  and  data  (sales,  marketing,   inventory),   occurrence  and
     expenditure  data,  and  advertising  data related to consumer  activity in
     various  industries  including,   but  not  limited  to  the  entertainment
     industry;

          (d) The delivery of technological intelligence, industry analysis, and
     strategic  and  tactical  guidance  with  respect to  consumer  activity in
     various  industries  including,   but  not  limited  to  the  entertainment
     industry; or

          (e) Any business directly  competitive with a business then engaged in
     by Corporation or identified in Corporation's three-year business plan.

     4.2  Covenant.  During the Term and for a period  ending on the last day of
the applicable  Noncompete Period described in Section 5.7,  Executive will not,
within any geographical area where Corporation engages in business:

          (a) Directly or indirectly, alone or with any individual, partnership,
     limited liability company,  corporation, or other entity, become associated
     with,  render  services  to,  invest in,  represent,  advise,  or otherwise
     participate in any  Competitive  Entity;  provided,  however,  that nothing
     contained in this Section 4.2 will prevent  Executive from owning less than
     5 percent  of any class of equity or debt  securities  listed on a national
     securities  exchange or market,  provided such  involvement  is solely as a
     passive investor;


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<PAGE>


          (b) Solicit any  business on behalf of a  Competitive  Entity from any
     individual,  firm,  partnership,  corporation,  or other  entity  that is a
     customer of Corporation during the 12 months immediately preceding the date
     Executive's employment with Corporation is terminated; or

          (c) Employ or otherwise  engage or offer to employ the services of any
     person (other than Executive's  assistant) who has been an employee,  sales
     representative,  or agent of Corporation during the 12 months preceding the
     date Executive's employment with Corporation is terminated.

For purposes of this Section 4, "Corporation" means Corporation and its
subsidiaries (whether now existing or subsequently created) and their successors
and assigns.

     4.3 Severability;  Reform of Covenant.  If, in any judicial  proceeding,  a
court  refuses to enforce  this  covenant  not to compete  because it covers too
extensive a geographic  area or is too long in its duration,  the parties intend
that  it be  reformed  and  enforced  to  the  maximum  extent  permitted  under
applicable law.

5. TERMINATION

     Executive's employment under this Agreement will terminate prior to the end
of the Term as follows:

     5.1 Death.  Executive's  employment will terminate  automatically  upon the
date of Executive's death.

     5.2  Disability.   Company  may,  at  its  option,   terminate  Executive's
employment  under this  Agreement upon written notice to Executive if Executive,
because of physical or mental  incapacity  or  disability,  fails to perform the
essential functions of his position, with reasonable accommodation,  required of
him under this  Agreement  for a  continuous  period of 120 days or any 180 days
within any 12-month period.

     5.3  Termination  by  Corporation  for  Cause.  Corporation  may  terminate
Executive's  employment under this Agreement for Cause at any time. For purposes
of this  Agreement,  "Cause" means:  (a) a material  breach of this Agreement by
Executive; (b) Executive's refusal,  failure, or inability to comply with any of
the material and lawful  policies or standards of  Corporation or to perform any
material job duties of  Executive  set forth in this  Agreement;  (c) any act of
fraud by Executive,  (d) any material act of  dishonesty by Executive  involving
Corporation or its business; or (e) Executive's  conviction of or a plea of nolo
contendere  to a felony;  provided  that Cause will not  include  any actions or
circumstances  constituting Cause under (a) or (b) above if Executive cures such
actions  or  circumstances  within 30 days of receipt  of  written  notice  from
Corporation setting forth the actions or circumstances constituting Cause.

     5.4  Termination by Executive for Good Reason.  Executive may terminate his
employment  with   Corporation   under  this  Agreement  for  "Good  Reason"  if
Corporation has not cured the actions or  circumstances  which are the basis for
such termination within 30 days following receipt by the Board of written notice
from  Executive  setting forth the actions or

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<PAGE>


circumstances  constituting Good Reason.  For purposes of this Agreement,  "Good
Reason" means:

          (a) Failure of  Corporation to comply with the terms of this Agreement
     or any other  agreement  entered into with  Executive by Corporation or any
     affiliate of Corporation; or

          (b) The occurrence  (without  Executive's  express written consent) of
     any of the following acts by Corporation or failures by Corporation to act:

               (i) A substantial  adverse  alteration in the nature or status of
          Executive's title, position,  duties, or reporting responsibilities as
          an executive of  Corporation;  (ii) A reduction  in  Executive's  base
          salary or other material non-discretionary compensation or benefits as
          set forth in this  Agreement  or as the base salary or other  material
          non-discretionary  compensation or benefits may be increased from time
          to time;

               (iii) The failure by Corporation to continue to provide Executive
          with benefits and  participation  in Benefit  Plans made  available by
          Corporation to its senior executives; or

               (iv) The relocation of Corporation's  executive  offices at which
          Executive is to provide services to a location more than 35 miles from
          its current location on N.E. Ambassador Place in Portland, Oregon.

     5.5  Termination by Corporation  Without Cause.  Corporation  may terminate
Executive's  employment  with  Corporation  without Cause at any time by written
notice to Executive.

     5.6 Termination by Executive  Without Good Reason.  Executive may terminate
Executive's  employment with Corporation  other than for Good Reason at any time
by written notice to the Secretary of the Corporation.

     5.7  Applicable  Noncompete  Periods  upon  Termination.  The  duration  of
Executive's  obligations  under Section 4 (the  "Noncompete  Period") will be as
follows:

          5.7.1  In  the  event   Executive   terminates  his  employment   with
     Corporation  for Good Reason under  Section 5.4 or  Corporation  terminates
     Executive's  employment with  Corporation  without Cause under Section 5.5,
     the Noncompete  Period will continue so long as Executive  receives Monthly
     Severance  Payments under Section 6.2.  Executive's  obligations under this
     Agreement will terminate immediately if Corporation fails to make a Monthly
     Severance Payment within 15 days after it is due. For this purpose, a check
     for a Monthly  Severance  Payment  mailed  within  such 15 day  period  (as
     evidenced  by official  postmark)  will be deemed to be made within such 15
     day period.


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<PAGE>

          5.7.2 In the event Corporation  terminates  Executive's employment for
     Cause,  Executive terminates his employment with Corporation other than for
     Good Reason under Section 5.6, or Executive's  employment with  Corporation
     terminates due to the expiration of the Term, the Noncompete Period will be
     one year from the date of termination.

6. COMPENSATION UPON TERMINATION

     6.1  Death,  Disability,   or  Expiration  of  Term.  Upon  termination  of
Executive's  employment  pursuant  to Section  5.1,  Section  5.2, or due to the
Expiration of the Term, all obligations of Corporation under this Agreement will
cease, except that Executive will be entitled to:

          (a) Accrued base salary through the date of Executive's termination of
     employment;

          (b) A prorated portion of the bonus described in Section 2.1 (not less
     than a pro rata portion of the minimum  bonus  described in that  Section);
     and

          (c) Other benefits under Benefit Plans to which Executive was entitled
     upon such  termination  of employment in accordance  with the terms of such
     Benefit Plans.

     6.2 Termination  Without Cause or by Executive for Good Reason;  Nonrenewal
of Term.

     6.2.1 Monthly Severance Payments.

          (a) In the event that no Change in Control  (as  defined in Section 7)
     has occurred and, prior to the expiration of the Term, Executive terminates
     his  employment  with  Corporation  for Good  Reason  under  Section 5.4 or
     Corporation  terminates  Executive's  employment with  Corporation  without
     Cause  under  Section  5.5,  Executive  will  be  entitled  to the  amounts
     described  in Section 6.1 plus  severance  payments  equal to the number of
     calendar  months  remaining in the Term plus six months  multiplied  by the
     base salary per month in effect as of the date of  termination,  payable in
     equal  monthly   installments  (each  installment,   a  "Monthly  Severance
     Payment").

          (b) In the event that Corporation and Executive do not extend the Term
     of this  Agreement  or enter into a  replacement  agreement as described in
     Section  1.2.2,  Executive  will be entitled to the  amounts  described  in
     Section 6.1 plus Monthly Severance  Payments equal to six months multiplied
     by the base salary per month in effect as of the end of the Term.

          (c) Corporation's obligations to pay Monthly Severance Payments (under
     either   paragraph  (a)  or  (b)  of  this  Section  6.2.1)  are  expressly
     conditioned on (i)Executive's  execution of a release (in the form attached
     to  this   Agreement  as  Appendix   6.2.1(c),   with  such   modifications
     specifically  in  response  to changes  in


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<PAGE>

     applicable  law as counsel  for  Corporation  determines  to be  reasonably
     necessary or desirable  to ensure  effective  release of all claims) of any
     and all claims that  Executive  may hold  through the date such  release is
     executed against Corporation or any of its subsidiaries or affiliates,  and
     (ii) the expiration of any applicable  revocation  period specified in such
     release without revocation of the release by Executive.

          (d) Monthly Severance  Payments will be payable in a manner consistent
     with Corporation's payroll practices for management employees.

          (e) Executive  will not be required to mitigate the Monthly  Severance
     Payments pursuant to this Agreement by seeking other  employment;  provided
     however,  that amounts payable by Corporation as Monthly Severance Payments
     will be reduced by compensation  actually  received by Executive from a new
     employer during the applicable severance period described above.

          6.2.2 Medical and Dental  Insurance  Benefits.  In addition to Monthly
     Severance Payments, Corporation will continue to provide or will arrange to
     provide Executive with medical and dental insurance benefits  substantially
     similar  to  those  to  which  Executive  was  entitled  as of the  date of
     termination  until  Corporation's  obligation  to  make  Monthly  Severance
     Payments  expires;  provided,  however,  that if Executive is employed with
     another  employer and is eligible to receive  medical and dental  insurance
     benefits  under  another  employer-provided  plan,  the  medical and dental
     benefits  described in this  paragraph  will be secondary to those provided
     under such other plan.

          6.2.3 Effect of Competition.  Corporation's obligation to make Monthly
     Severance  Payments and provide  medical and dental  insurance  benefits to
     Executive  will  terminate  if Executive  breaches a material  provision of
     Section 4.

     6.3 Termination For Cause or by Executive Without Good Reason. In the event
that, prior to the expiration of the Term,  Corporation  terminates  Executive's
employment with Corporation for Cause under Section 5.3, or Executive terminates
his employment  with  Corporation  for other than Good Reason under Section 5.6,
Corporation's  obligations under this Agreement will cease and Executive will be
entitled to that portion of his base salary and employment benefits for which he
is qualified as of the date of termination and Executive will not be entitled to
any other compensation or consideration.

7. EFFECT OF CHANGE IN CONTROL

     7.1 Definitions.

     "Change in Control".  For purposes of this Agreement, a "Change in Control"
will be deemed to have occurred upon the first fulfillment of the conditions set
forth in any one of the following three paragraphs:

          (a) Any  "person"  (as that term is  defined in  Section  3(a)(9)  and
     13(d)(3) of the Securities  Exchange Act of 1934, as amended (the "Exchange
     Act"),  other than a trustee or other fiduciary holding securities under an
     employee


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<PAGE>

     benefit plan of  Corporation,  is or becomes a  beneficial  owner
     (within  the meaning of Rule 13d-3  promulgated  under the  Exchange  Act),
     directly or  indirectly,  of  securities  of  Corporation  representing  30
     percent  or  more  of the  combined  voting  power  of  Corporation's  then
     outstanding securities;

          (b) A  majority  of the  directors  elected  at any  annual or special
     meeting of shareholders are not individuals nominated by Corporation's then
     incumbent Board; or

          (c) The shareholders of Corporation  approve a merger or consolidation
     of  Corporation  with  any  other  corporation,  other  than  a  merger  or
     consolidation  which would result in the voting  securities of  Corporation
     outstanding  immediately prior to such transaction  continuing to represent
     (either  by  remaining  outstanding  or  by  being  converted  into  voting
     securities  of the  surviving  entity) at least 51 percent of the  combined
     voting power of the voting  securities of  Corporation or of such surviving
     entity outstanding  immediately after such merger or consolidation,  or the
     shareholders  of  Corporation  approve a plan of  complete  liquidation  of
     Corporation  or an agreement for the sale or  disposition by Corporation of
     all or substantially all of its assets.

         "Other Payment" means any payment or benefit payable to Executive in
connection with a Change in Control of Corporation pursuant to any plan,
arrangement, or agreement (other than this Agreement) with Corporation, a person
whose actions result in such Change in Control, or any person affiliated with
Corporation or such person.

         "Total Payments" means all payments or benefits payable to Executive in
connection with a Change in Control, including Change in Control Payments
pursuant to this Agreement and any Other Payments pursuant to any other plan,
agreement, or arrangement with Corporation, a person whose actions result in the
Change in Control, or any person affiliated with Corporation or such person.

     7.2  Compensation   Upon   Termination   Following  a  Change  in  Control.


          7.2.1  Change  in  Control  Payments.  In the  event of  Corporation's
     termination  of Executive  without  Cause,  or  Executive's  termination of
     employment with Corporation for Good Reason, at any time following a Change
     in Control during the Term of this Agreement, Executive will be entitled to
     the following payments (the "Change in Control Payments"):

          (a) A lump sum severance payment equal to two times Executive's annual
     base salary as in effect  immediately before the Change in Control plus two
     times Executive's bonus  compensation for the most recent fiscal year ended
     prior to the Change in Control;

          (b)  Continuation for a period of two years following such termination
     of Executive's  participation  in all Benefit Plans in which  Executive was
     entitled to participate immediately before the Change in Control,  provided
     that such continued  participation  is possible under the general terms and
     provisions  of such

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<PAGE>


     Benefit Plans.  In the event  Executive's  continued  participation  in any
     Benefit Plan is barred by the  provisions of the Benefit Plan,  Corporation
     will arrange to provide  Executive with benefits  substantially  similar to
     those which Executive was entitled to receive under the Benefit Plan.

          7.2.2  Reduction.  In the event that any portion of the Total Payments
     payable to Executive in connection  with a Change in Control of Corporation
     would  constitute an "excess  parachute  payment" within the meaning of IRC
     ss.  280G(b) that is subject to the excise tax imposed on so-called  excess
     parachute payments pursuant to IRC ss.4999 (an "Excise Tax"), the Change in
     Control Payments otherwise payable under this Section 7.2.1 will be reduced
     to avoid such Excise Tax if, and to the extent that,  such  reduction  will
     result in a larger after-tax benefit to Executive,  taking into account all
     applicable federal, state, and local income and excise taxes.

          7.2.3   Application.  For purposes of this Section 7.2:


          (a) No portion of the Total  Payments,  the  receipts or  enjoyment of
     which  Executive  has  effectively  waived in writing  prior to the date of
     payment of any Change in Control Payments, will be taken into account;

          (b) No portion of the Total Payments will be taken into account which,
     in the  opinion of tax  counsel  selected  by  Corporation  and  reasonably
     acceptable to Executive ("Tax  Counsel"),  does not constitute a "parachute
     payment" within the meaning of IRC ss. 280G;

          (c) If  Executive  and  Corporation  disagree  whether  any payment of
     Change in  Control  Payments  will  result in an  Excise  Tax or  whether a
     reduction  in any  Change  in  Control  Payments  will  result  in a larger
     after-tax benefit to Executive, the matter will be conclusively resolved by
     an opinion of Tax Counsel;

          (d)  Executive  agrees  to  provide  Tax  Counsel  with all  financial
     information  necessary to determine the after-tax  consequences of payments
     of Change in Control  Payments for purposes of determining  whether,  or to
     what  extent,  Change in Control  Payments  are to be reduced  pursuant  to
     Section 7.2.2; and

          (e) The  value of any  noncash  benefit  or any  deferred  payment  or
     benefit included in the Total Payments, and whether or not all or a portion
     of any payment or benefit is a  "parachute  payment"  for  purposes of this
     Section 7.2, will be determined by Corporation's independent accountants in
     accordance with the principles of IRC ss. 280(G)(d)(3) and (4).

          7.2.4  Effect  on  Other  Agreements.  In the  event  that  any  other
     agreement,  plan, or  arrangement  providing for Other  Payments (an "Other
     Agreement")  has a provision that requires a reduction in the Other Payment
     governed by such Other Agreement to avoid or eliminate an "excess parachute
     payment" for purposes of IRC ss. 280G,  the  reduction in Change in Control
     Payments  pursuant  to  Section  7.2.2  will be  given  effect  before  any
     reduction  in the Other  Payment  pursuant to the Other  Agreement.  To the


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<PAGE>

     extent  possible,  Corporation  and  Executive  agree  that  reductions  in
     benefits under any plan,  program,  or  arrangement of Corporation  will be
     reduced  (only to the extent  described in Section  7.2.2) in the following
     order of priority:

          (a) Change in Control Payments under this Agreement;

          (b) Benefit Plan benefit  continuation  pursuant to Section  7.2.1(b);
              and

          (c) The  acceleration  in the  exercisability  of any stock  option or
     other stock related award granted by Corporation.

8. REMEDIES

     The respective  rights and duties of Corporation  and Executive  under this
Agreement  are in  addition  to,  and not in lieu of,  those  rights  and duties
afforded to and imposed  upon them by law or at equity.  Executive  acknowledges
that any breach or threatened  breach of Sections 3 or 4 of this  Agreement will
cause  irreparable  harm to  Corporation  and that any  remedy  at law  would be
inadequate to protect the legitimate interests of Corporation.  Executive agrees
that Corporation will be entitled to seek specific  performance,  or to seek any
other form of injunctive  relief, to enforce its rights under Sections 3 or 4 of
this Agreement.  Such remedies will be in addition to any other remedy available
to Corporation at law or in equity.

9. SEVERABILITY OF PROVISIONS

     The  provisions of this  Agreement are  severable,  and if any provision of
this  Agreement is held  invalid,  unenforceable,  or  unreasonable,  it will be
enforced to the maximum extent permissible,  and the remaining provisions of the
Agreement will continue in full force and effect.

10. NONWAIVER

     Failure of Corporation at any time to require  performance of any provision
of this  Agreement  will not limit  the  right of  Corporation  to  enforce  the
provision.  No provision of this  Agreement or breach of this  Agreement  may be
waived by either party except in writing  signed by that party.  A waiver of any
breach of a provision of this Agreement will be construed  narrowly and will not
be deemed to be a waiver of any succeeding  breach of that provision or a waiver
of that provision itself or of any other provision.

11. NOTICES

     All notices  required or permitted  under this Agreement must be in writing
and will be  deemed  to have  been  given if  delivered  by hand,  or  mailed by
first-class,  certified mail, return receipt requested,  postage prepaid, to the
respective  parties  as  follows  (or to such  other  address  as any  party may
indicate  by a  notice  delivered  to  the  other  parties  hereto):  (i)  if to
Executive, to his residence as listed in Corporation's records, with a copy to:


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<PAGE>


         Weissmann, Wolff, Bergman, Coleman, Grodin & Evall, LLP
         9665 Wilshire Boulevard
         Suite 900
         Los Angeles, California  90212
         Attn:  Mr. Alan L. Grodin Esq.

         and (ii) if to Corporation, to the address of the principal office
         of Corporation, at:

         One Airport Center
         7700 N.E. Ambassador Place
         Portland, Oregon  97220

12. ATTORNEY FEES

     In the event of any suit or action or arbitration  proceeding to enforce or
interpret any provision of this Agreement (or which is based on this Agreement),
the  prevailing  party will be entitled to recover,  in addition to other costs,
the reasonable attorney fees incurred by the prevailing party in connection with
such  suit,   action,  or  arbitration,   and  in  any  appeal  therefrom.   The
determination  of who is the  prevailing  party  and the  amount  of  reasonable
attorney  fees  to be paid  to the  prevailing  party  will  be  decided  by the
arbitrator or  arbitrators  (with respect to attorney fees incurred prior to and
during the arbitration  proceedings)  and by the court or courts,  including any
appellate courts, in which the matter is tried, heard, or decided, including the
court which hears any exceptions  made to an arbitration  award  submitted to it
for  confirmation  as a judgment (with respect to attorney fees incurred in such
confirmation proceedings).

13. GOVERNING LAW

     This Agreement  will be construed in accordance  with the laws of the state
of Oregon,  without  regard to any  conflicts of laws rules.  Any suit or action
arising  out of or in  connection  with this  Agreement,  or any  breach of this
Agreement,  must be brought and maintained in the Circuit Courts of the State of
Oregon.  The parties hereby irrevocably submit to the jurisdiction of such court
for the  purpose  of such suit or action and hereby  expressly  and  irrevocably
waive,  to the fullest extent  permitted by law, any claim that any such suit or
action has been brought in an inconvenient forum.

14. GENERAL TERMS AND CONDITIONS

     This Agreement and the Option Agreement constitute the entire understanding
of the parties  relating to the  employment  of  Executive by  Corporation,  and
supersede  and  replace  all  written  and oral  agreements  heretofore  made or
existing by and between the parties  relating  thereto.  Executive  acknowledges
that he has read and understood all of the  provisions of this  Agreement,  that
the  restrictions  contained  in  Sections  4 and  5.7  of  this  Agreement  are
reasonable and necessary for the protection of  Corporation's  business and that
Executive  entered into this contract in connection with a bona fide advancement
of  Executive  with  Corporation  in that  Executive  was  granted  a  long-term
employment contract.  This Agreement will inure to the benefit of any successors
or assigns of  Corporation.  All captions  used in this  Agreement  are intended
solely  for  convenience  of  reference  and  will  in no way  limit  any of the
provisions of this Agreement.


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<PAGE>

     The parties have executed this  Employment  Agreement as of the date stated
above.


                                             RENTRAK CORPORATION



/s/ Kenneth M. Papagan                       By /s/ F. Kim Cox
    Kenneth M. Papagan                       Title    President




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<PAGE>

                                APPENDIX 6.2.1(c)


                              AGREEMENT AND RELEASE


     THIS  AGREEMENT  AND  RELEASE  ("Release")  is  made  on  this  ___  day of
_______________,   200__,  by  and  between  Rentrak   Corporation,   an  Oregon
corporation  ("Corporation") and Kenneth M. Papagan  ("Executive").  Corporation
and Executive agree as follows:

1.    Payment to Executive.

     (a) Upon  the  execution  of this  Release,  and  after  expiration  of the
revocation  period  specified  in Section 9 of this  Release,  Corporation  will
commence  payment of the  applicable  Monthly  Severance  Payments  described in
Section  6 of  Executive's  Employment  Agreement  dated  __________,  2002 (the
"Employment Agreement"), less normal deductions and withholdings.

     (b) Executive  specifically  acknowledges  and agrees that  Corporation has
paid Executive all wages and other  compensation and benefits to which Executive
is entitled  except those  described in Paragraph  1(a) of this Release and that
the execution of this Release (and compliance with the noncompetition provisions
of  Section  4  of  the  Employment   Agreement)  are  conditions  precedent  to
Corporation's obligation to make the Monthly Severance Payments.

2.   Release by Executive.

     Executive hereby completely releases and forever discharges Corporation and
each of its past,  present,  and future parent and subsidiary  corporations  and
affiliates and each of their respective past, present,  and future shareholders,
officers,  directors,  agents,  employees,  insurers,  successors,  and  assigns
(collectively,  the "Released Parties"),  from any and all claims,  liabilities,
demands,  and causes of action of any kind,  whether statutory or common law, in
tort, contract, or otherwise, in law or in equity, and whether known or unknown,
foreseen or unforeseen,  in any way arising out of,  concerning,  or related to,
directly or indirectly, Executive's employment with Corporation,  including, but
not limited to, the  termination of Executive's  employment  based on any act or
omission on or prior to the effective  date of this  Release,  but not including
any claim for workers' compensation or unemployment insurance benefits.  Without
limiting the generality of the foregoing,  this release  specifically  includes,
but is not limited to, a release of claims  arising under Title VII of the Civil
Rights Act of 1964; the Age Discrimination in Employment Act; the Americans with
Disabilities  Act; the Family and Medical  Leave Act;  the  Employee  Retirement
Income Security Act; the Worker Adjustment and Retraining  Notification Act; and
ORS chapters 652, 653, and 659A, and any amendments to any of such laws.

3.   Return of Corporation Property.

     Executive   represents   and  warrants  that   Executive  has  returned  to
Corporation all property  belonging to Corporation,  including,  but not limited
to,  all  documents  or  other  media  containing  confidential  or  proprietary
information of Corporation  (including without limitation customer,



                                       1
<PAGE>



production,  and pricing  information),  and all Corporation credit cards, keys,
cellular telephones, and computer hardware and software.

4.   No Liability or Wrongdoing.

     Corporation  specifically  denies any liability or  wrongdoing  whatsoever.
Neither this Release nor any of its provisions,  terms, or conditions constitute
an  admission  of  liability  or  wrongdoing  or may be offered or  received  in
evidence in any action or proceeding as evidence of an admission of liability or
wrongdoing.

5.   Severability.

     If any  provision  of this  Release  is found by any court to be illegal or
legally  unenforceable for any reason, the remaining  provisions of this Release
will continue in full force and effect.

6.   Attorney Fees.

     If any action is brought to  interpret  or enforce this Release or any part
of it, the prevailing party will be entitled to recover from the other party its
reasonable attorney fees and costs incurred therein, including all attorney fees
and costs on any appeal or review.

7.   Choice of Law.

     This Release  will be governed by the laws of the state of Oregon,  without
regard to its principles of conflicts of laws.

8.   Consideration of Agreement.

     Executive  acknowledges  that  Corporation  has  advised  him in writing to
consult with an attorney  before signing this Release and that he has been given
at least 21 days to consider  whether to execute this  Release.  For purposes of
this 21-day period,  Executive  acknowledges  that this Release was delivered to
him on ________, 20__, that the 21-day period will expire ___________, 20__, and
that he may have until that date to consider the Release.

9.   Revocation.

     Executive  may  revoke  this  Release  by  written  notice,   delivered  to
___________  within  seven days  following  his date of  signature  as set forth
below.  This Release  becomes  effective and  enforceable  after such  seven-day
period has expired.

10.  Knowing and Voluntary Agreement.

     Executive acknowledges and agrees that: (a) the only consideration for this
Release is the consideration  expressly  described in this document;  (b) he has
carefully read the entire Release; (c) he has had the opportunity to review this
Release  and to have it  reviewed  and  explained  to him by an  attorney of his
choosing;  (d) he fully understands the final and binding

                                       2
<PAGE>

effect; and (e) he is signing this Release  voluntarily and with the full intent
of releasing Corporation from all claims.

11.  Miscellaneous.

     The benefits of this Release  will inure to the  successors  and assigns of
the parties.  This is the entire  agreement  between  Executive and  Corporation
regarding the subject matter of this Release and neither party has relied on any
representation  or  statement,  written  or oral,  that is not set forth in this
Release.  Executive  represents and warrants that Executive has not assigned any
claim that  Executive  may have  against the  Released  Parties to any person or
entity.


RENTRAK CORPORATION


By:
      ----------------------                        ----------------------------
                                                     Kenneth M. Papagan
Title:
       ---------------------

Date:                                                Date:
      ----------------------                         ---------------------------




STATE OF  ___________________                    )
                                                 )   SS
COUNTY OF __________________                     )

This instrument was acknowledged before me on __________, 2002,
by Kenneth M. Papagan.




                                       Notary Public for
                                       My commission expires:


                                       3