Employment Agreement - Rentrak Corp. and Timothy J. Erwin
EMPLOYMENT AGREEMENT
This Employment Agreement is entered into effective as of November 1, 2002,
by and between Timothy J. Erwin ("Executive") and RENTRAK CORPORATION, an Oregon
corporation (the "Corporation").
1. SERVICES
1.1 Employment Position. Corporation agrees to employ Executive as Vice
President, Customer Relations, and Executive accepts such employment, under the
terms and conditions of this Agreement.
1.2 Term. The term of this Agreement (the "Term") commences on December 1,
2002, and will expire November 30, , 2005. Notwithstanding the foregoing, in the
event of a Change in Control of Corporation, as defined in Section 7 of this
Agreement, during the Term of this Agreement, the Term will automatically be
extended to December 31 of the second calendar year following the year in which
the Change in Control occurs.
1.3 Duties. During the Term, Executive will serve in an executive capacity
as Vice President, Customer Relations. Executive will report directly to
Corporation's President. Executive will be responsible for direction and
supervision of all customer relations activities on behalf of Corporation and
such other or different duties on behalf of Corporation as may be assigned from
time to time by Corporation's President, Chief Executive Officer, or 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. 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. Corporation acknowledges
and consents to Executives ownership interest and management activities in Malt
Enterprises, Inc., doing business in Sandy Oregon as Star Video and acknowledges
that Corporation will not treat such activity as violating the provisions of
this Section 1.4 or of Section 4 of this Agreement
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 $150,000 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. Annually, during
the Term, Corporation's Compensation Committee (the
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"Committee") will review Executive's performance, the performance of
Corporation, and Corporation's economic prospects for the coming year, and will
consider in its sole discretion whether to increase (but not decrease) the base
salary payable to Executive.
2.2 Bonus Compensation.
2.2.1 General. Executive will participate, together with
Corporation's other senior executives, in Corporation's Annual Incentive
Compensation Plan under which Executive will be assigned predetermined
incentive target levels and performance criteria and factors established
in the discretion of the Committee and will have the opportunity to
receive bonus compensation based on such criteria.
2.2.2 Fiscal 2003-2004. For the fiscal year ending March 31, 2004,
in lieu of participation in the Annual Incentive Compensation Plan
described above, Corporation and Executive will enter into a separate
program providing Executive an opportunity to earn a commission bonus in
accordance with the terms and conditions set forth on Appendix 2.2.2,
based on the extent to which Corporation achieves or exceeds specified
revenue goals during the fiscal year ending March 31, 2004.
2.3 Stock Options. 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.
2.4 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 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. Subject to review and approval by the chairman of
Corporation's audit committee, 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.
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
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information received from third parties that Corporation has agreed to treat 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), 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.
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.
3.7 Effect of Prior Agreement. Executive acknowledges that the provisions
of this Section 3 are in addition to and do not supersede the provisions of that
Confidentiality and Invention Agreement (the "Prior Agreement") between
Corporation and Executive dated effective July 15, 1991, and that the Prior
Agreement remains in full force and effect.
4. NONCOMPETITION
Executive acknowledges and agrees that the provisions of Section 5
captioned "Covenant Against Competition" in the Prior Agreement will remain in
full force and effect. If, in any judicial proceeding, a court refuses to
enforce this covenant not to compete because it covers too
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extensive a geographic area, is too long in its duration, or for any other
reason, 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 the
general policies or standards of Corporation or to perform any job duties of
Executive; (c) any act of fraud by Executive, (d) any act of dishonesty by
Executive involving Corporation or its business; (e) Executive's conviction of
or a plea of nolo contendere to a felony; or (f) the commission of any act in
direct or indirect competition with or materially detrimental to the best
interests of Corporation that is in breach of Executive's fiduciary duties to
Corporation; 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 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
(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;
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(ii) A reduction in Executive's base salary as set forth in
this Agreement or as the base salary 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.
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 2.2
(not less than a pro rata portion of the minimum bonus described in
that Section);
(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 Salary Continuation Payments Upon Death or Disability. Upon
termination of Executive's employment pursuant to Section 5.1 or Section 5.2,
Executive will be entitled to the amounts described in Section 6.1, plus salary
continuation payments equal to six months multiplied by the base salary per
month in effect as of the date of termination, payable in equal monthly
installments. Such salary continuation payments will be payable in a manner
consistent with Corporation's payroll practices for management employees.
6.3 Termination Without Cause or by Executive for Good Reason.
6.3.1 Monthly Severance Payments.
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(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 twelve 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) Corporation's obligations to pay Monthly Severance
Payments under this Section 6.3.1 are expressly conditioned on (i)
Executive's execution of a release (in the form attached to this
Agreement as Appendix 6.3.1(b), with such modifications
specifically in response to changes in 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.
(c) Monthly Severance Payments will be payable in a manner
consistent with Corporation's payroll practices for management
employees.
(d) 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
severance period described above.
6.3.2 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,
Corporation's obligation to provide the medical and dental benefits
described in this paragraph will terminate automatically.
6.3.3 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 the noncompetition provisions of the Prior Agreement
described in Section 4.
6.4 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
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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 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.
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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 (as extended pursuant
to Section 1.2), Executive will be entitled to the following payments (the
"Change in Control Payments"):
(a) A lump sum severance payment equal to the sum of
Executive's annual base salary as in effect immediately before the
Change in Control plus Executive's bonus compensation for the most
recent fiscal year ended prior to the Change in Control;
(b) Continuation for a period of one year 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 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
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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
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 specific performance, or to any other form
of injunctive relief to enforce its rights under Sections 3 or 4 of this
Agreement without the necessity of showing actual damage or irreparable harm or
the posting of any bond or other security. 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
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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, 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 constitutes the entire understanding of the parties
relating to the employment of Executive by Corporation, and supersedes and
replaces 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 Section 4 of this Agreement are reasonable and necessary for the
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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.
The parties have executed this Employment Agreement as of the date stated
above.
RENTRAK CORPORATION
/s/ Timothy J. Erwin By: F. Kim Cox
Timothy J. Erwin Title: President
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APPENDIX 2.2.2
COMMISSION BONUS PROGRAM
Fiscal Year Ending March 31, 2004
1. Terminology. Capitalized terms not otherwise defined in this Appendix
or the Agreement have the meanings set forth in paragraph 5.
2. Quarterly Bonuses. On or before each of July 31, 2003, October 30,
2003, and January 31, 2004, subject to the overall limitations of paragraph 4,
Corporation will pay Executive a Quarterly Bonus equal to the sum of (a) $2,500
and (b) 0.001% of the Excess Quarterly Revenues for the preceding fiscal quarter
(ending June 30, September 30, and December 31, 2003 respectively).
3. Annual Bonus. On or before June 30, 2004, subject to the overall
limitations of paragraph 4, Corporation will pay Executive an Annual Bonus equal
to the excess (if any) over the aggregate amounts previously paid as Quarterly
Bonuses pursuant to paragraph 2 of the sum of (a) $10,000 plus (b) 0.003% of the
Excess Annual Revenues for the fiscal year ending March 31, 2004.
4. Overall Limitation. In no event will the aggregate of Quarterly Bonuses
and Annual Bonus payable to Executive for the Plan Year exceed $50,000. If
Qualified Revenues exceed $* million for the Plan Year, Corporation's
Compensation Committee may, in its sole discretion, consider payment of an
additional bonus.
5. Subsequent Fiscal Years. As provided in Section 2.2.1 of Participant's
Employment Agreement, for periods following Corporation's fiscal year ending
March 31, 2004, Participant will participate in Corporation's Annual Incentive
Compensation Plan.
6. Definitions. For purposes of this program:
"Annual Bonus" means the bonus payable pursuant to paragraph
3.
"Benchmark Amount" means an amount equal to *
"Excess Annual Revenues" means Corporation's Qualified
Revenues for the Plan Year in excess of the Benchmark Amount.
"Excess Quarterly Revenues" means, for each of the fiscal
quarters ending June 30, September 30, and December 31, 2003,
Corporation's Qualified Revenues for such quarter in excess of 25% of
the Benchmark Amount.
"Plan Year" means the fiscal year beginning April 1, 2003, and
ending March 31, 2004.
"Qualified Revenues" means the following categories of
Corporation's revenues from video leasing activities;
(a) Order processing fees;
(b) Transaction fees;
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(c) Sell-through fees;
(d) End of term fees; and
(e) Data communication fees
"Quarterly Bonus" means a bonus payable pursuant to paragraph 2.
*Confidential portions omitted pursuant to a request for confidential treatment.
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APPENDIX 6.3.1(b)
FORM OF
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 _______________("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,
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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
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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:
--------------------------------- ----------------------------------
Title:
------------------------------
Date: Date:
------------------------------- ----------------------------------
STATE OF ___________________ )
) SS
COUNTY OF __________________ )
This instrument was acknowledged before me on __________, 20___, by _______
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