EXHIBIT 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (hereinafter referred to as the
"Agreement") is made and entered into effective this 1st day of
April, 1998, by and between RENTRAK CORPORATION, an Oregon
corporation (hereinafter referred to as "Employer"), and F. XXX
XXX (hereinafter referred to as "Employee").
W I T N E S S E T H:
WHEREAS, Employer currently employs Employee in the capacity
of Executive Vice President and Employee is one of the key
executives of the Employer;
WHEREAS, Employer and Employee have entered into an
Employment Agreement dated as of April 20, 1995 (the "Employment
Agreement"), and Employer and Employee desire to modify the terms
of the Employment Agreement upon the terms and subject to the
conditions of this Agreement;
WHEREAS, the terms of this Agreement shall supersede in its
entirety the terms of the Employment Agreement;
WHEREAS, Employer considers it essential to the best
interests of its shareholders to xxxxxx the continuous employment
of Employee;
NOW, THEREFORE, in consideration of the mutual promises,
covenants and agreements herein contained, the recitals set forth
hereinabove which by this reference are incorporated herein, and
other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereby agree as follows:
SECTION 1. EMPLOYMENT
1.01. Position and Title. Employer shall employ and
engage the services of Employee, in the position of Executive
Vice President for the term of this Agreement as defined in
Section 2, infra, pursuant to the terms and conditions set forth
in this Agreement.
1.02. Duties and Place of Employment. Employee shall be
responsible for, and perform duties associated with his position
as Executive Vice President and other duties as may be directed
by the Employer, from time to time. Employee shall: (i) devote
his full business time during normal business hours to the
business and affairs of Employer; (ii) use his best efforts to
promote the interests of Employer; and (iii) perform faithfully
and efficiently his responsibilities. Employee shall perform his
duties at the Employer's principal executive offices which are
currently located at One Airport Center, 0000 X.X. Xxxxxxxxxx
Xxxxx, Xxxxxxxx, Xxxxxx 00000, or such other locations as may be
reasonably directed by Employer from time to time. Subject to
the terms of this Agreement, Employee shall comply promptly and
faithfully with all of Employer's policies, instructions,
directions, requests, rules and regulations.
SECTION 2. TERM AND TERMINATION
2.01. Stated Term. Employment shall commence on the
effective date of this Agreement and shall continue for a period
of four (4) years ending on March 31, 2002 or until Employee's
employment under this Agreement is terminated pursuant to
Section 2.02, Section 2.03, or Section 2.04, infra ("Term").
2.02. At Will Termination. Notwithstanding anything
herein to the contrary, Employee's employment may be terminated
at any time with our without reason, by Employer upon thirty (30)
days written notice to Employee, or by Employee upon thirty (30)
days written notice to Employer.
2.03. For Cause Termination. Employee's employment may
be terminated by Employer without notice for "cause."
Termination for "cause" is defined for purposes of this
subsection as termination upon: (i) the final conviction of
Employee for a felony involving willful conduct materially
injurious, harmful or detrimental to Employer; or (ii) the final
adjudication of Employee in a civil proceeding for acts or
omissions to act involving willful conduct materially injurious,
harmful or detrimental to Employer. For the purposes of this
subsection, "final conviction" and "final adjudication" shall be
and mean a conviction or and adjudication, as the case may be,
that is no longer appealable due to the passage of time or
otherwise, and with respect to which a final judgment has been
entered on the judgment roles of the court in which the action
was commenced. Further, for the purposes of this subsection, no
act or omission to act on Employee's part shall be considered
"willful" unless done, or omitted to be dome, by Employee in bad
faith and without reasonable belief that Employee's act of
omission was in the best interest of Employer.
2.04. Disability or Death. Employee's employment shall
be terminable immediately upon Employee's death or disability.
"Disability" is defined for purposes of this subsection as
absence from Employee's full time duties with Employer as a
result of Employee's incapacity due to physical or mental illness
for ninety (90) days calculated on a cumulative basis during any
two (2) year period during the term of this Agreement. Nothing
in this Section 2.04 is intended to violate any Oregon State law
regarding parental or family leave policies or any other
applicable law.
SECTION 3. COMPENSATION
3.01. Base Salary. Commencing April 1, 1998 through
March 31, 1999, Employee shall be paid an annual base salary in
the amount of one hundred seventy-eight thousand five hundred
dollars ($178,500); commencing April 1, 1999 through March 31,
2000, Employee shall be paid an annual base salary in the amount
of one hundred eighty-seven thousand four hundred twenty-five
dollars ($187,425); commencing April 1, 2000 through March 31,
2001, Employee shall be paid an annual base salary in the amount
of one hundred ninety-six thousand seven hundred ninety-six
dollars ($196,796); and commencing April 1, 2002 through March
31, 2002, Employee shall be paid an annual base salary in the
amount of two hundred six thousand six hundred thirty-six dollars
($206,636) ("Base Salary"). The Base Salary shall be paid to
Employee in equal semi-monthly installments in arrears on the
seventh (7th) and twenty-second (n) day of each month, commencing
as of the first semi-monthly pay period following the effective
date of this Agreement. Should the seventh (7th) or the twenty-
second (n) day of any month not be a business day, Employee's
semi-monthly installment of the Base Salary otherwise due on such
date shall be paid to Employee on the business day closest to the
date such semi-monthly installment is due (i.e., if the seventh
(7th) day of the month falls on a Saturday, the semi-monthly
installment shall be paid on the preceding business day or if the
seventh (7th) day of the month falls on a Sunday, the semi-
monthly installment shall be paid on the next following business
day). Employee's Base Salary may be increased in the discretion
of Employer during the Term of this Agreement.
3.02. Bonus Compensation. Nothing herein shall preclude
the Employer from authorizing the payment of additional
compensation to Employee over and above the Base Salary at any
time payable to him under his Agreement, whether as a bonus or
otherwise. The payment of such additional compensation shall not
operate as an amendment obligating Employer to make any similar
payment or to pay additional compensation at any future time or
for any future period, or be deemed to affect Employee's Base
Salary in any manner. Employee will participate in whatever
bonus plan is adopted by Employer including any cash bonus pools
established from time to time by Employer for Corporate
Executives.
3.03. Stock Options. Upon execution of this Agreement,
Employer shall grant Employee one hundred thousand (100,000)
options for Employer's stock. To the extent allowed under the
Internal Revenue Code of 1986 ("Code"), the stock options will be
granted pursuant to that certain Incentive Stock Option
Agreement, a copy of which is attached to this Agreement as
Exhibit A. The remaining options, if any, not allowed as
incentive stock options under the Code will be granted as
nonqualified options, copies of which are attached hereto as
Exhibit B. Said options shall be priced on the date of execution
of this Agreement and shall vest according to the following
schedule:
Date Number of Options Vested
March 31, 2000 33,333
March 31, 2001 33,333
March 31, 2002 33,334
3.04. Benefits.
3.04A Vacation and Holiday Pay. As of the
effective date of this Agreement, Employee
will be entitled to: (i) accrue vacation
time at the rate of four (4) weeks of paid
vacation during each year of employment; and
(ii) will be eligible to receive pay for
Employer-paid holidays.
3.04B Insurance. Employee shall be entitled
to medical, life, worker's compensation,
social security and state unemployment
insurance benefits as provided under
Employer's then current terms, policies and
procedures, except that the ninety day
waiting period for such insurance benefits
shall be waived.
3.04C Tuition Reimbursement. Employee shall
be entitled to reimbursement for all tuition,
enrollment fees, and books pursuant to
Employers education assistance program.
Employee shall comply with all Employer's
terms, policies and procedures regarding its
education assistance program.
3.04D Miscellaneous Benefits. In addition
to any other compensation or benefits to be
received by Employee pursuant to the terms of
this Agreement, Employee shall be entitled to
participate in any employee benefits which
Employer may from time to time provide its
employees or its corporate officers
generally.
SECTION 4. PAYMENTS UPON TERMINATION OF EMPLOYMENT
4.01. Termination for Cause. In the event of the
termination of Employee's employment by Employer for cause as
defined in Section 2.03, supra, or in the event of termination of
Employee's employment by Employee, Employer shall pay to Employee
only the amount of compensation accrued pursuant to Section 3.01,
supra, through and including the date of termination.
4.02. Termination for Death or Disability. In the
event of the termination of Employee's employment due to his
death or disability, Employer shall pay to Employee or Employee's
estate or legal representative, as the case may be, the amount of
compensation accrued pursuant to Section 3.01, supra, as of the
date of termination plus a lump sum severance payment equal to
one hundred eighty (180) days Base Salary in effect as of the
date of termination.
4.03. Other Termination. In the event of termination of
Employee's employment by Employer other than as provided in
Section 4.01 or 4.02, supra, Employer shall pay Employee the
amount of compensation accrued pursuant to Section 3.01, supra,
as of the date of termination plus severance payments in an
amount equal to one year's Base Salary in effect as of the date
of termination, payable in installments as if still employed;
subject however, to Employee demonstrating that he is using his
best efforts to find employment of comparable status within one
hundred (100) miles of wherever last located. For purposes of
this Agreement, "employment" shall be defined to include self-
employment and the offering of consulting services. In the event
Employee does not use, or cannot demonstrate that he is using his
best efforts to obtain other employment severance payments shall
cease. If Employee does use his best efforts to obtain other
employment and is successful in obtaining such employment,
severance payments shall be reduced by the amount of any
remuneration received from such employment. For the purposes of
this Agreement, "remuneration" shall be defined to include cash
payments, the face value of any promissory notes issued to
Employee regardless of the terms of payment or whether payments
are ever received, stock or stock options valued as of the day
granted, or any other compensation given in any form whatsoever.
4.04. Other Compensation. In the event of a termination
of Employee's employment, all stock options held by Employee as
described in Section 3.03 of this Agreement shall vest
immediately. Except as set forth in this Section 4, no other
compensation shall be due or payable to Employee upon termination
of his employment.
SECTION 5. PERSONAL NATURE
This Agreement is personal, and is being entered into based
upon the singular skill, qualifications and experience of
Employee. Employee shall not assign this Agreement or any rights
hereunder without the express written consent of Employer which
may be withheld with or without reason. Employee hereby grants
to Employer the right to use Employee's name, likeness and/or
biography in connection with the services performed by Employee
hereunder and in connection with the advertising or exploitation
of any project with respect to which Employee performs services
hereunder.
SECTION 6. NOTICES
Any and all notices or other or other communications
required or permitted by this Agreement or by law shall be deemed
duly served and given when personally delivered to the party to
whom such notice or communication is directed or, in lieu of such
personal service, when deposited in the United States mail,
certified, return receipt requested, first class postage prepaid,
addressed as follows:
EMPLOYER: Rentrak Corporation
One Airport Center
0000 X.X. Xxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxx 00000
Attn: Xxx Xxxxxx
COPY TO: Xxxx Xxxxxxxx
Corporate Director of Legal and Business
Affairs
0000 X.X. 00xx Xxxxxx
P.O. Box 18888
Xxxxxxxx, Xxxxxx 00000
EMPLOYEE: F. Xxx Xxx
0000 X.X. 000xx Xxxxx
Xxxxxxxx, Xxxxxx 00000
Each party may change its address for purposes of this
Section by giving written notice of such change in the manner
provided for in this Section.
SECTION 7. MISCELLANEOUS PROVISIONS
7.01. Attorneys' Fees. In the event that it should be
become necessary for any party to bring an action, including
arbitration, either at law or in equity, to enforce or interpret
the terms of this Agreement, each party shall pay its own
attorneys' fees including those incurred in resolving the dispute
prior to initiation of any litigation and at trial and on any
appeal.
7.02. Applicable Law and Venue. This Agreement is
executed and intended to be performed in the State of Oregon and
the laws of such State shall govern its interpretation and
effect. If suit is instituted by any party hereto or by any
other party for any cause or matter arising from or in connection
with the respective rights or obligations of the parties
hereunder, the sole jurisdiction and venue for such action shall
be the Circuit Court of the State of Oregon in and for the County
of Multnomah.
7.03. Integration. Employee has simultaneously executed
an Incentive Stock Option Agreement (a copy of which is attached
hereto as Exhibit A), a Nonqualified Stock Option Agreement (a
copy of which is attached hereto as Exhibit B) and has previously
executed an Employee Confidentiality and Noncompetition Agreement
( a copy of which is attached hereto as Exhibit C) which remain
in effect and are incorporated into the terms and conditions of
employment under this Agreement. Except as set forth in the
preceding sentence, this Agreement constitutes the entire
agreement of the parties with respect to the subject matter of
this Agreement and supersedes all prior agreements, negotiations,
or understandings, whether oral or written, between the parties
with respect thereto.
7.04. Heirs and Assigns. Subject to any restriction on
assignment contained herein, this Agreement shall be binding upon
and shall inure to the benefit of the respective party's heirs,
successors and assigns.
7.05. Severability. Any provision in this Agreement
which is, by competent judicial authority, declared illegal,
invalid or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such illegality,
invalidity or unenforceability without invalidating the remaining
provisions hereof or affecting the legality, validity or
enforceability of such provision in any other jurisdiction. The
parties hereto agree to negotiate in good faith to replace any
illegal, invalid or unenforceable provision that, to the extent
possible, will preserve the economic bargain of this Agreement,
or otherwise to amend this Agreement.
7.06. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, and the
counterparts shall together constitute one and the same
agreement, notwithstanding that all of the parties are not
signatory to the original or the same counterpart.
7.07. Captions. The headings and captions herein are
inserted solely for the purpose of convenience of reference and
are not intended to govern, any term or provision hereof.
7.08. Execution. Each of the parties hereto shall
execute, acknowledge and deliver any instrument necessary to
carry out the provisions of this Agreement.
7.09. Construction. This Agreement has been prepared by
legal counsel for Employer. Employee has been advised and by his
execution hereof acknowledges, that he has the right to and
should have this Agreement reviewed by his own separate legal
counsel. This Agreement has been negotiated at arms' length with
the benefit of or opportunity to seek legal counsel and,
accordingly, shall not be construed against any of the parties.
7.10 Indemnification. Employer shall indemnify
Employee to the fullest extent permitted by law for and against
any and all cost, loss, expense and liability including, without
limitation, attorneys' fees, incurred by Employee as a result of
the performance of his duties for Employer. Such obligation to
indemnify shall include, without limitation, indemnification
against any and all claims arising out of the Non-Disparagement
Agreement entered into on July 10, 1997 between Employer,
Employee, Xxx Xxx and Xxxxxxx X. Xxxxxxxxxxx.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
EMPLOYER:
RENTRAK CORPORATION,
an Oregon Corporation
_____________________________________
By: Xxx Xxxxxx, President
EMPLOYEE:
I acknowledge that I have read and agree to the foregoing
Agreement including, without limitation, the provision allowing
termination of my employment "at will" by Employer in Section
2.01, supra.
_________________________________
F. Xxx Xxx
