RENTRAK CORPORATION
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT, dated ____________, is made by
and between Rentrak Corporation, an Oregon corporation
(hereinafter referred to as "Company"), and
____________________________, an employee of the Company or
a Subsidiary of the Company (hereinafter referred to as
"Optionee"):
WHEREAS, the Company wishes to afford the Optionee
the opportunity to purchase shares of its $0.001 par value
Common Stock; and
WHEREAS, the Company wishes to carry out the 1997
Equity Participation Plan of Rentrak Corporation
(hereinafter referred to as "Plan") (the terms of which are
hereby incorporated by reference and made a part of this
Agreement); and
WHEREAS, the Committee, appointed to administer
the Plan, has delegated to certain officers of the Company
the authority to implement grants of Options under the Plan;
and
WHEREAS, such officers have determined that it
would be to the advantage and best interest of the Company
and its shareholders to grant the non-qualified Option
provided for herein to the Optionee as an inducement to
enter into or remain in the service of the Company or its
Subsidiaries and as an incentive for increased efforts
during such service;
NOW, THEREFORE, in consideration of the mutual
covenants herein contained and other good and valuable
consideration, receipt of which is hereby acknowledged, the
parties hereto agree as follows:
ARTICLE
GRANT OF OPTION
Section 1.1. - Grant of Option
In consideration of the Optionee's agreement to
remain in the employ of the Company or its subsidiairies and
for other good and valuable consideration, on the date
hereof the Company irrevocably grants to the Optionee the
option to purchase any part or all of an aggregate of
____________ shares of its $0.001 par value Common Stock
upon the terms and conditions set forth in this Agreement.
Section 1.2. - Purchase Price
The purchase price of the shares of stock covered
by the Option shall be $__________ per share, without
commission or other charge.
Section 1.3. - Consideration to Company
In consideration of the granting of this Option by
the Company, the Optionee agrees to render faithful and
efficient services to the Company or a Subsidiary, with such
duties and responsibilities as the Company shall from time
to time prescribe. Nothing in this Agreement or in the Plan
shall confer upon the Optionee any right to continue in the
employ of the Company or any Subsidiary, or as a director of
the Company, or shall interfere with or restrict in any way
the rights of the Company and its Subsidiaries, which are
hereby expressly reserved, to discharge the Optionee at any
time for any reason whatsoever, with or without cause.
Section 1.4. - Adjustments in Option
The Committee shall make adjustments with respect
to the Option in accordance with the provisions of Section
9.3 of the Plan.
ARTICLE II.
PERIOD OF EXERCISABILITY
Section 2.1. - Commencement of Exercisability
(a) Subject to Section 4.5, the Option shall
become exercisable in [four (4) cumulative installments as
follows:
The first installment shall consist of
twenty-five percent (25%) of the shares covered by the
Option and shall become exercisable on the first
anniversary of the date the Option is granted.
The second installment shall consist of
twenty-five percent (25%) of the shares covered by the
Option and shall become exercisable on the second
anniversary of the date the Option is granted.
The third installment shall consist of
twenty-five percent (25%) of the shares covered by the
Option and shall become exercisable on the third
anniversary of the date the Option is granted.
The fourth installment shall consist of
twenty-five percent (25%) of the shares covered by the
Option and shall become exercisable on the fourth
anniversary of the date the Option is granted.
(b) No portion of the Option which is
unexercisable at Termination of Employment shall thereafter
become exercisable.
Section 2.2. - Duration of Exercisability
The installments provided for in Section 2.1 are
cumulative. Each such installment which becomes exercisable
pursuant to Section 2.1 shall remain exercisable until it
becomes unexercisable under Section 2.1.
Section 2.3. - Expiration of Option
The Option may not be exercised to any extent by
anyone after the first to occur of the following events:
(a) The expiration of ten (10) years from the
date the Option was granted; or
(b) The expiration of one (1) month from the date
of the Optionee's Termination of Employment unless such
Termination of Employment results from his death, his
retirement, his disability or his being discharged not for
good cause; or
(c) The expiration of one (1) month from the date
of the Optionee's Termination of Employment by reason of his
retirement or his being discharged not for good cause,
unless the Optionee dies within said one-month period; or
(d) The expiration of one (1) year from the date
of the Optionee's Termination of Employment by reason of his
disability; or
(e) The expiration of one (1) year from the date
of the Optionee's death.
(f) The effective date of either the merger or
consolidation of the Company with or into another
corporation, or the acquisition by another corporation or
person of all or substantially all of the Company's assets
or eighty percent (80%) or more of the Company's then
outstanding voting stock, or the liquidation or dissolution
of the Company, unless the Committee waives this provision
in connection with such transaction. As soon as practicable
prior to the effective date of such merger, consolidation,
acquisition, liquidation or dissolution, the Committee shall
give the Optionee notice of such event if the Option has
then neither been fully exercised nor become unexercisable
under this Section 2.3.
Section 2.4. - Adjustments to and/or Cancellation of
the Option
If there is a material alteration in the capital
structure of the Company on account of a reorganization,
merger, recapitalization, exchange of shares, stock split,
reverse stock split, stock dividend, or otherwise, the
Committee shall make such adjustments to the Plan and to the
Options then outstanding under the Plan as the Committee
determines to be appropriate and equitable under the
circumstances. Such adjustments may include, without
limitation, (a) a change in the number or kind of shares
of stock of the Company covered by the Options and/or (b)
a change in the Option Price payable per share; provided,
however, that the aggregate Option Price applicable to the
unexercised portion of existing Options shall not be
altered, it being intended that any adjustments made with
respect to these Options shall apply only to the price per
share and the number of shares subject thereto. For
purposes of this paragraph, neither (i) the issuance of
additional shares of stock of the Company in exchange for
adequate consideration (including services), nor (ii) the
conversion of outstanding preferred shares of the Company
into Common Stock, shall be deemed a material alteration of
the capital structure of the Company. In the event the
Committee shall determine that the nature of a material
alteration in the capital structure of the Company is such
that it is not practical or feasible to make appropriate
adjustments to the Plan or to this Option, such event shall
be deemed a Termination Event subject to the following
paragraph.
In the event of (a) the dissolution or
liquidation of the Company, (b) a reorganization , merger,
or consolidation of the Company with one or more
corporations as a result of which the Company will not be a
surviving corporation, (c) the sale of all or substantially
all of the assets of the Company, (d) a sale or other
transfer of more than eighty percent (80%) of the then
outstanding shares of Common Stock of the Company, or (e)
a material change in the capital structure of the Company
that is subject to this Section in accordance with the last
sentence of the previous paragraph (any of such events is
herein referred to as a "Terminating Event"), the Committee
shall determine whether a provision will be made in
connection with the Terminating Event for an appropriate
assumption of this Option for stock or for substitution of
appropriate new options covering stock of a successor
corporation employing the Optionee under this Plan and
Agreement or stock of an affiliate of such successor
employer corporation . If the Committee determines that
such an appropriate assumption or substitution will be made,
the Committee shall give notice of the determination to the
Optionee and the provisions of such assumption or
substitution, and any adjustments made (i) to the number
and kind of shares subject to the Option outstanding under
the Plan (or to options issued in substitution therefor),
(ii) to the Option price and/or (iii) to the terms and
conditions of this Option, shall be binding upon the
Optionee. If the Committee determines that no assumption or
substitution will be made, the Committee shall give notice
of this determination to the Optionee, whereupon the
Optionee shall have the right for a period of thirty (30)
days following the notice to exercise in full or in part any
unexercised or unexpired Option then held by him or her,
without regarding to any contingent vesting provision to
which the Option may otherwise been subject pursuant to
Paragraph 2.1a above. Upon the expiration of this thirty
(30) day period, this option shall expire to the extent not
earlier exercised, and the Plan shall terminate.
ARTICLE III.
GRANT OF OPTION
Section 3.1. - Partial Exercise
Any exercisable portion of the Option or the
entire Option, if then wholly exercisable, may be exercised
in whole or in part at any time prior to the time when the
Option or portion thereof becomes unexercisable under
Section 2.3; provided, however, that each partial exercise
shall be for not less than ten (10) shares (or the minimum
installment set forth in Section 2.1, if a smaller number of
shares) and shall be for whole shares only.
Section 3.2. - Manner of Exercise
The Option, or any exercisable portion thereof,
may be exercised solely by delivery to the Secretary or his
office of all of the following prior to the time when the
Option or such portion becomes unexercisable under Section
2.3:
(a) A written notice complying with the
applicable rules established by the Committee stating that
the Option, or a portion thereof, is exercised. The notice
shall be signed by the Optionee or other person then
entitled to exercise the Option or such portion; and
(b) Full payment to the Company for the shares with
respect to which such Option or portion exercised in accordance
with Section 5.2d of the Plan.
(i) With the consent of the Committee, (A) shares of
the Company's Common Stock owned by the Optionee, duly endorsed for transfer
to the Company, with a Fair Market Value on the date of delivery
equal to the aggregate exercise price of the Option or exercised portion
thereof, or (B) shares of the Company's Common Stock issuabe to the Optionee
upon exercise of the Option, with a Fair Market Value on the date of
delivery equal to the aggregate exercise price of the Option or exercised
thereof; or
(ii) With the consent of the Committee, a
notice that the Optionee has placed a market sell order
with a broker with respect to shares of the Company's
Common Stock then issuable upon exercise of the Option,
and that the broker has been directed to pay a
sufficient portion of the net proceeds of the sale to
the Company in satisfaction of the Option exercise
price.
(c) A bona fide written representation and
agreement, in a form satisfactory to the Committee, signed
by the Optionee or other person then entitled to exercise
such Option or portion, as the Committee in its discretion
shall determine is necessary or appropriate to effect
compliance with the Securities Act and any other federal or
state securities laws or regulations. Without limiting the
generality of the foregoing, the Committee may require an
opinion of counsel acceptable to it to the effect that any
subsequent transfer of shares acquired on an Option exercise
does not violate the Securities Act, and may issue
stop-transfer orders covering such shares. Share
certificates evidencing stock issued on exercise of this
Option shall bear an appropriate legend referring to the
provisions of this subsection (c) and the agreements herein.
The written representation and agreement referred to in the
first sentence of this subsection (c) shall, however, not be
required if the shares to be issued pursuant to such
exercise have been registered under the Securities Act, and
such registration is then effective in respect of such
shares; and
(d) Full payment to the Company (or other
employer corporation) of all amounts which, under federal,
state or local tax law, it is required to withhold upon
exercise of the Option; with the consent of the Committee,
(i) shares of the Company's Common Stock owned by the
Optionee, duly endorsed for transfer, with a Fair Market
Value equal to the sums required to be withheld, or (ii)
shares of the Company's Common Stock issuable to the
Optionee upon exercise of the Option with a Fair Market
Value equal to the sums required to be withheld, may be used
to make all or part of such payment; and
(e) In the event the Option or portion shall be
exercised pursuant to Section 4.1 by any person or persons
other than the Optionee, appropriate proof of the right of
such person or persons to exercise the Option.
Section 3.3. - Rights as Shareholder
The holder of the Option shall not be, nor have
any of the rights or privileges of, a shareholder of the
Company in respect of any shares purchasable upon the
exercise of any part of the Option unless and until
certificates representing such shares shall have been issued
by the Company to such holder.
ARTICLE IV.
OTHER PROVISIONS
Section 4.1. - Option Not Transferable
Neither the Option nor any interest or right
therein or part thereof shall be sold, pledged, assigned, or
transferred in any manner other than by will or the laws of
descent and distribution, unless and until such Option has
been exercised, or the shares underlying such Option have
been issued, and all restrictions applicable to such shares
have lapsed. Neither the Option nor any interest or right
therein or part thereof shall be liable for the debts,
contracts or engagements of the Optionee or his successors
in interest or shall be subject to disposition by transfer,
alienation, anticipation, pledge, encumbrance, assignment or
any other means whether such disposition be voluntary or
involuntary or by operation of law by judgment, levy,
attachment, garnishment or any other legal or equitable
proceedings (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect,
except to the extent that such disposition is permitted by
the preceding sentence.
Section 4.2. - Shares to Be Reserved
The Company shall at all times during the term of
the Option reserve and keep available such number of shares
of stock as will be sufficient to satisfy the requirements
of this Agreement.
Section 4.3. - Notices
Any notice to be given under the terms of this
Agreement to the Company shall be addressed to the Company
in care of its Secretary, and any notice to be given to the
Optionee shall be addressed to him at the address given
beneath his signature hereto. By a notice given pursuant to
this Section 4.3, either party may hereafter designate a
different address for notices to be given to him. Any
notice which is required to be given to the Optionee shall,
if the Optionee is then deceased, be given to the Optionee's
personal representative if such representative has
previously informed the Company of his status and address by
written notice under this Section 4.3. Any notice shall be
deemed duly given when enclosed in a properly sealed
envelope or wrapper addressed as aforesaid, deposited (with
postage prepaid) in a post office or branch post office
regularly maintained by the United States Postal Service.
Section 4.4. - Titles
Titles are provided herein for convenience only
and are not to serve as a basis for interpretation or
construction of this Agreement.
Section 4.5. - Construction
This Agreement shall be administered, interpreted
and enforced under the internal laws of the State of Oregon
without regard to conflicts of laws thereof.
Section 4.6. - Conformity to Securities Laws
The Optionee acknowledges that the Plan is intended to
conform to the extent necessary with all provisions of the
Securities Act and the Exchange Act and any and all
regulations and rules promulgated by the Securities and
Exchange Commission thereunder, including without limitation
Rule 16b-3. Notwithstanding anything herein to the
contrary, the Plan shall be administered, and the Option is
granted and may be exercised, only in such a manner as to
conform to such laws, rules and regulations. To the extent
permitted by applicable law, the Plan and this Agreement
shall be deemed amended to the extent necessary to conform
to such laws, rules and regulations.
IN WITNESS WHEREOF, this Agreement has been
executed and delivered by the parties hereto.
RENTRAK CORPORATION
By ___________________________
President
Optionee's Taxpayer
Identification Number:
Optionee:
____________________________
