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EXHIBIT
10.36
EMPLOYMENT
AGREEMENT
This Employment Agreement is
entered into effective as of January 1, 2008, by and between
Christopher E. Roberts (“Executive”) and
RENTRAK CORPORATION , an Oregon corporation (the
“Corporation”).
1.1 Employment
Position . Corporation agrees to employ Executive as Sr. Vice
President, Home Entertainment Media & Information
Services, and Executive accepts such employment, under the terms
and conditions of this Agreement. Executive also agrees to serve,
if elected, without separate compensation, as an officer and/or
director of any subsidiary or affiliate of Corporation. Corporation
represents to Executive that it currently has and will maintain
directors and officers liability insurance.
1.2 Term .
1.2.1 General . The
term of this Agreement (the “Term”) will commence on
January 1, 2008, and, subject to the other provisions of this
Section 1.2, will expire December 31, 2008.
1.2.2 Renewal Term or
Terms . The term of this Agreement will automatically extend
into one or more “Renewal Terms” of an additional
one-year period that will expire on December 31, 2008 (or
December 31 of any such subsequent Renewal Term), unless
Corporation, not later than October 31, 2008 (or
October 31 of any subsequent Renewal Term), gives written
notice (a “Notice of Non-Renewal”) to Executive that
the Term will not extend into a Renewal Term. Corporation may give
a Notice of Non-Renewal for any reason or for no reason. Failure to
extend the Term into a Renewal Term will not constitute a
termination of Executive’s employment effective as of the end
of the Term or any applicable Renewal Term for purposes of this
Agreement. References to the “Term” of this Agreement
include the initial Term and, if the Agreement extends into one or
more Renewal Terms pursuant to this Section, the Renewal Term or
Terms.
1.2.3 Extension of Term
Upon Change in Control . Notwithstanding the foregoing, in the
event of a Change in Control of Corporation, as defined in
Section 8.1 of this Agreement, during the Term (or any Renewal
Term) of this Agreement, the Term will automatically be extended to
December 31 of the second calendar year following the calendar
year in which the Change in Control occurs.
1.2.4 At-Will
Employment . The parties acknowledge that Executive is and will
be an at-will employee of Corporation and nothing in this Agreement
will limit the right of Corporation or Executive to terminate this
Agreement at any time for any reason or for no reason, subject to
the provisions of this Agreement describing the compensation
payable, if any, in connection with such a termination of
employment.
1.2.5 Compensation Upon
Termination Following Term Of Agreement . Notwithstanding
termination of this Agreement, the provisions of Section 7
will continue to apply.
1.3 Duties . During
the Term, Executive will serve in an executive capacity as Sr. Vice
President, Home Entertainment Media & Information
Services. Executive will report directly to President, Home
Entertainment. Executive will be responsible for the direction and
supervision of Home Entertainment Essentials (Retail &
Rental), Direct Revenue Share (DRS) and Digital Download Essentials
Services on behalf of Corporation, and such other or different
duties on behalf of Corporation as may be assigned from time to
time by President, Home Entertainment, 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
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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.
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 $175,100 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. Executive’s annual base salary will be reviewed by
Corporation’s Chief Executive Officer and Compensation
Committee (the “Committee”) on or before April 1
of each year during the Term (commencing in 2008), unless
Executive’s employment has been terminated earlier pursuant
to this Agreement, to determine if such annual base salary should
be increased (but not decreased) for the following fiscal year in
recognition of services to Corporation.
2.2 Corporate and Personal
Performance Improvement Incentive Plan .
2.2.1 Definitions .
For purposes of this Section 2.2, the following terms have
this meanings set forth below:
“Bonus
Income” means, for any Fiscal Year, the excess of the Net
Income for Corporation for the Fiscal Year over the Threshold
Income for the Fiscal Year.
“Corporate
Performance Incentive Bonus” means a bonus under the
Incentive Plan to reflect Corporate performance improvement equal
to, for each Fiscal Year, the product of (a) the Bonus Income
for that Fiscal Year, (b) Executive’s Performance
Achievement Factor for the Fiscal Year, and
(c) Executive’s Participation Percentage for the Fiscal
Year.
“Fiscal
2008” means the fiscal year beginning April 1, 2007,
and ending March 31, 2008.
“Fiscal
2008” means the fiscal year beginning April 1, 2008,
and ending March 31, 2009.
“Incentive
Plan” means Corporation’s Corporate and Personal
Performance Improvement Incentive Plan.
“Net
Income” means, for each Fiscal Year, the net income
before income taxes for Corporation as determined for financial
accounting purposes in accordance with Corporation’s standard
accounting policies and principles, consistently
applied.
“Parameters” mean, for each Fiscal Year, the
Corporate “Report Card” parameters and the
“Personal Expectation” performance parameters
established by Corporation’s CEO, with the approval of the
Compensation Committee for Executive for a Fiscal Year.
Executive’s Corporate Report Card parameters and Personal
Expectation performance parameters for Fiscal 2008 were previously
designated by Corporation’s CEO, with the approval of the
Compensation Committee, and communicated to Executive. For Fiscal
2009 and any subsequent Fiscal Year beginning in a Renewal Term,
Corporation’s CEO, with the approval of the Compensation
Committee will designate Executive’s Corporate Report Card
parameters and Personal Expectation performance parameters no later
than May 31, 2008 (or May 31 of that Fiscal
Year).
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“Parameter
Achievement Factors” mean, for each Fiscal Year, the
factors, expressed as percentages, determined by
Corporation’s CEO, with the approval of the Compensation
Committee after the end of the Fiscal Year to reflect the extent to
which the Corporate Report Card Parameters and Executive’s
Personal Expectation Parameters for the Fiscal Year have been
accomplished.
“Participation
Percentage” means, for a Fiscal Year, a percentage
specified by Corporation’s CEO, with the approval of the
Compensation Committee, to determine Executive’s Corporate
Performance Incentive Bonus. For Fiscal 2008, Executive’s
Participation Percentage is
%. For
Fiscal 2009 and any subsequent Fiscal Year beginning in a Renewal
Term, Corporation’s CEO, with the approval of the
Compensation Committee will specify Executive’s Participation
Percentage no later than May 31, 2008 (or May 31 of that
Fiscal Year).
“Personal
Performance Incentive Bonus” means a bonus under the
Incentive Plan to reflect personal performance equal to, for each
Fiscal Year, the product of (a) the Personal Performance
Incentive Maximum Bonus for the Fiscal Year and (b) the
Executive’s Performance Achievement Factor for the Fiscal
Year.
“Personal
Performance Incentive Maximum Bonus” means an amount of
money set for a Fiscal Year by the Corporation’s CEO, with
the approval of the Compensation Committee, as the maximum amount
of money that the Executive might earn as a Personal Performance
Incentive Bonus. The Personal Performance Incentive Maximum Bonus
for Fiscal 2008 was previously designated by Corporation’s
CEO, with the approval of the Compensation Committee, and
communicated to Executive. For Fiscal 2009 and any subsequent
Fiscal Year beginning in a Renewal Term, the Compensation Committee
will designate the Personal Performance Incentive Maximum Bonus no
later than May 31, 2008 (or May 31 of that Fiscal
Year).
“Performance
Achievement Factor” means a factor, expressed as a
percentage, rounded to the nearest whole percent, based on the
arithmetic average of the Parameter Achievement Factors for a
Fiscal Year; provided however that (a) if the average of the
Parameter Achievement Factors is less than 75%, the Performance
Achievement Factor will be zero, and (b) the Performance
Achievement Factor may not exceed 100% unless expressly approved by
Corporation’s CEO, with the approval of the Compensation
Committee.
“Threshold
Income” means the level of Net Income for Corporation for
a Fiscal Year as designated by Corporation’s CEO, with the
approval of the Compensation Committee. The Threshold Income for
Fiscal 2008 was previously designated by Corporation’s CEO,
with the approval of the Compensation Committee, and communicated
to Executive. For Fiscal 2009 and any subsequent Fiscal Year
beginning in a Renewal Term, the Compensation Committee will
designate the Threshold Income no later than May 31, 2008 (or
May 31 of that Fiscal Year).
2.2.2 Determination of
Parameter Achievement Factors . As soon as practicable after
March 31, 2008 (or March 31 of any Fiscal Year beginning
in a Renewal Term), Corporation’s CEO, with the approval of
the Compensation Committee will evaluate the extent to which
Corporation and Executive have met the Report Card and Personal
Expectation parameters and determine the Parameter Achievement
Factors for Fiscal 2008 (or such Fiscal Year).
2.2.3 Aggregate Incentive
Bonus.
(a) Fiscal 2008 .
Provided Executive remains an employee of Corporation through at
least March 31, 2008, Corporation will pay Executive a bonus
under the Incentive Plan equal to the sum of the Corporate
Performance Incentive Bonus for Fiscal 2008 and the Personal
Performance Incentive Bonus for Fiscal 2008. Such bonus, if any,
will be paid to Executive by June 1, 2008.
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(b) Fiscal 2009 and
Subsequent Fiscal Years Beginning in a Renewal Term . Provided
Executive remains an employee of Corporation through at least
March 31, 2009 (or March 31 of any subsequent Fiscal Year
that begins during a Renewal Year), Corporation will pay Executive
a bonus under the Incentive Plan equal to the sum of the Corporate
Performance Incentive Bonus for Fiscal 2009 (or such subsequent
Fiscal Year) and the Personal Performance Incentive Bonus for
Fiscal 2009 (or such subsequent Fiscal Year). Such bonus, if any,
will be paid to Executive by June 1, 2009 (or June 1
of such subsequent Fiscal Year).
2.3 Equity-Based or Other
Long-Term Incentive Compensation . Executive will participate,
together with Corporation’s other senior executives, in
Corporation’s 2005 Stock Incentive Plan (the
“Plan”). Executive will be granted options to purchase
shares of Corporation’s common stock and/or other
equity-based awards under the Plan, or under another long-term
incentive compensation plan that may be developed by Corporation
for its senior executives, at the times and in the amounts
determined by the Committee. All awards will be subject to the
provisions of the Plan or such other long-term 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
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.
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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 Employee Confidentiality Agreement (the
“Prior Agreement”) between Corporation and Executive
dated effective June 17, 1992, and that the Prior Agreement
remains in full force and effect.
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 (such as sales, marketing, inventory, occurrence, expenditure,
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
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any class of equity or debt
securities listed on a national securities exchange or market,
provided such involvement is solely as a passive
investor;
(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 for Executive or any other person,
entity, or corporation, the services or employment of any person
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, 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.
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) Executive’s willful material misconduct in
performance of the duties of his position with Corporation or a
material breach by Executive of this Agreement,
(b) Executive’s willful commission of a material act of
malfeasance, dishonesty, or breach of trust against Corporation or
its successors that materially harms or discredits Corporation or
its successors or is materially detrimental to the reputation of
Corporation or its successors, or (c) Executive’s
conviction of or a plea of nolo contendere to a felony involving
moral turpitude. In all cases, Corporation will give Executive
notice setting for forth in reasonable detail the specific respects
in which the Corporation believes it has Cause to terminate
Executive and allow Executive a reasonable opportunity to correct
such conduct.
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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