EXHIBIT 10.3
ENCORE CAPITAL GROUP, INC.
TRANSITION AGREEMENT
This
Transition Agreement (the “Agreement”), to be effective
as of June 13, 2005 (the “Effective Date”), by and
between Encore Capital Group, Inc., a Delaware corporation (the
“Company”), and Barry Barkley.
WHEREAS,
Mr. Barkley and the Company previously discussed Mr.
Barkley’s retirement from his position as the Company’s
Chief Financial Officer.
WHEREAS,
the Company desires for Mr. Barkley to serve as a director on the
Company’s Board of Directors (the
“Board”).
WHEREAS,
Mr. Barkley is willing to serve as director on the Board on the
terms and subject to the conditions set forth in this Agreement,
and Mr. Barkley authorized the Company to submit his Board
nomination to the Company’s stockholders at the Annual
Meeting of Stockholders held on May 3, 2005 (the “2005 Annual
Meeting”).
THE
PARTIES AGREE AS FOLLOWS:
1.
Mr. Barkley hereby confirms his resignation from his office as
Chief Financial Officer of the Company as of May 3, 2005. Mr.
Barkley further agrees: (i) to serve as a director of the Company
until the Company’s Annual Meeting of Stockholders held in
2006 (the “2006 Annual Meeting”); (ii) if he is
nominated to serve on the Board and is elected to the Board by the
Company’s stockholders at the 2006 Annual Meeting, to serve
as a director of the Company until the Company’s Annual
Meeting of Stockholders held in 2007 (the “2007 Annual
Meeting”); and (iii) if he is nominated to serve on the Board
and is elected to the Board by the Company’s stockholders at
the 2007 Annual Meeting, to serve as a director of the Company
until September 11, 2007.
2.
In consideration for each year of his service as a director of the
Company, if any, Mr. Barkley will be entitled to receive the same
compensation, benefits and other rights the Company provides to the
other non-employee members of the Board. The Company also agrees to
reimburse Mr. Barkley for all reasonable travel and other expenses
incurred by him in conjunction with his Board service in a manner
consistent with the Company’s reimbursement policy for
directors.
3.
In consideration for Mr. Barkley’s willingness to serve on
the Board, pursuant to Section 4(iv) of Mr. Barkley’s
Non-Incentive Stock Option Agreement granted on September 11, 2002
(the “ 2002 Option ”), fifty percent (50%) of
the shares of Common Stock subject to the 2002 Option shall be
deemed to have vested on May 3, 2005, and the remaining fifty
percent (50%) of the shares of Common Stock subject to the 2002
Option shall vest on the earlier of May 3, 2006 or the 2006 Annual
Meeting (the “End Vesting Date”). Notwithstanding the
foregoing, the shares of Common Stock subject to the 2002 Option
shall immediately vest in full if: (i) Mr. Barkley is removed from
(or not elected to) the Board Without Cause (as defined
hereinafter) prior to the End Vesting Date; (ii) in the event Mr.
Barkley dies prior to the End Vesting Date; (iii) in the event
that Mr. Barkley shall become Disabled (as defined hereinafter)
prior to the End Vesting Date; or (iv) immediately prior to a
Change of Control (as defined in Annex A ). Nothing in this
paragraph shall prohibit the earlier vesting of the shares of
Common Stock subject to the 2002 Option in accordance with the
existing terms of the 2002 Option.
4.
For purposes of this Agreement, “Disabled” shall mean
that Mr. Barkley shall have failed, due to illness or other
physical or mental incapacity, to render services of the character
contemplated by this Agreement for an aggregate of more than ninety
(90) calendar days during any twelve (12) month period.
5.
For purposes of this Agreement, “Without Cause” shall
mean Mr. Barkley’s involuntary removal from the Board for
reasons other than:
