Rentrak 8-K 2006
Pursuant to Section 13
or 15(d) of
Date of Report (Date of earliest event reported):
May 25, 2006
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On May 25, 2006, Rentrak Corporation (Rentrak) entered into employment agreements dated as of January 1, 2006, with Mark Thoenes, as Executive Vice President and Chief Financial Officer, and Timothy Erwin, as Vice President Sales and Customer Relations of the Retailer Services Department of Rentraks Pay Per Transaction (PPT) Division.
The agreement for Mr. Thoenes provides for:
The agreement for Mr. Erwin provides for:
Severance During Term of Agreement
If the employee dies or becomes disabled during the term of the agreement, he or his estate will be entitled to accrued base salary and other employee benefits through the date of termination of employment. If employment is terminated during the term of the agreement and before a change in control of Rentrak occurs, by Rentrak without cause or by the employee for good reason, in addition to the benefits payable as described in the preceding sentence, the employee will be entitled to receive severance payments in the amount of his monthly base salary during a severance period of (a) three months for each full four years of continuous service, (b) a specified number of months (six months for Mr. Erwin and nine months for Mr. Thoenes), or (c) the remaining term of the agreement, whichever is longest. Medical benefits will also be continued during this period. If employment is terminated during the term of the agreement and after a change in control of Rentrak occurs, either without cause or for good reason, the employee will be entitled to receive a lump sum payment equal to two times his then-current annual base salary and average annual bonus amount (including any commissions in the case of Mr. Erwin), subject to reduction if his resulting after-tax benefit would be larger due to the effect of the excise tax on excess parachute payments. He will also be entitled to continuation of medical benefits for two years. No severance benefits are payable if employment is terminated by Rentrak for cause or voluntarily by the employee other than for good reason. The terms cause, good reason, and change in control are defined in the agreements.
Severance After Term of Agreement
The agreements also provide for continuation of medical benefits and for severance payments in the event employment is terminated by Rentrak without cause, or by the employee with good reason, after expiration of the term, provided the employee has been employed by Rentrak for at least five consecutive years. The total amount of the severance payments will equal the employees monthly base salary then in effect times (a) three months for each full four years of continuous service or (b) for Mr. Erwin, six months, and for Mr. Thoenes, nine months, whichever is greater.
The above summary description of the employment agreements is qualified in its entirety by the full text of the agreements, copies of which are filed as Exhibits 10.1 and 10.2 to this report and incorporated by reference.
Annual Base Salary Levels
In April 2006, the Compensation Committee of the Board of Directors of Rentrak approved retroactive increases in annual base salary levels for certain executive officers to the following amounts:
Salary compensation is payable in accordance with Rentraks regular payroll practices for management employees. The Compensation Committee approved the new salary levels after review of individual performance, company performance, and Rentraks economic prospects.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
The following exhibits are filed with this Form 8-K:
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.