<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
[X] Definitive Proxy Statement RULE 14A-6(E)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Rentrak Corporation
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
--Enter Company Name Here--
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
--------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
--------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------------
(5) Total fee paid:
--------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
--------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
RENTRAK CORPORATION
7227 NE 55th Avenue
Portland, Oregon 97218
To Our Shareholders:
Our 1996 Annual Meeting of Shareholders will be held at the Heathman Hotel, 1001
S.W. Broadway, Portland, Oregon, August 19, 1996, at 8:00 a.m., Pacific Daylight
Time. The purpose of the meeting is to:
1. Elect two (2) Directors to serve for terms of three (3) years; and
2. Hear and consider reports from Officers of the Company; and
3. Transact such other business as may properly come before the meeting or any
adjournments thereof.
The formal notice of the meeting and the proxy statement containing information
pertaining to the meeting follow this letter. The Company's 1996 Annual Report
is also enclosed.
Please be sure to sign, date and return the enclosed proxy card whether or not
you plan to attend the meeting so that your shares will be voted at the meeting.
If you do attend the meeting, and the Board of Directors joins me in hoping that
you will, there will be an opportunity to revoke your proxy and to vote in
person if you prefer.
Sincerely yours,
/s/ Ron Berger
RON BERGER
Chairman of the Board July 11, 1996
<PAGE>
RENTRAK CORPORATION
7227 NE 55th Avenue
Portland, Oregon 97218
Notice of Annual Meeting of Shareholders
August 19, 1996
The Annual Meeting of Shareholders of Rentrak Corporation (the "Company") will
be held at the Heathman Hotel, 1001 S.W. Broadway, Portland, Oregon, August 19,
1996, at 8:00 a.m., Pacific Daylight Time, for the following purposes:
1. To elect two (2) Class II Directors to serve for terms of three (3) years;
and
2. To hear and consider reports from Officers of the Company; and
3. To transact such other business as may properly come before the meeting or
any adjournments thereof.
The Board of Directors has fixed the close of business on June 28, 1996, as the
record date for determining shareholders entitled to notice of, and to vote at,
the meeting and any adjournments thereof.
The Proxy Statement accompanies this Notice.
By Order of the
Board of Directors
/s/ F. Kim Cox
F. Kim Cox, Secretary July 11, 1996
Please sign, date and return the enclosed Proxy as soon as possible. A
return envelope is enclosed for your convenience.
<PAGE>
RENTRAK CORPORATION
7227 NE 55th Avenue
Portland, Oregon 97218
PROXY STATEMENT
Annual Meeting, August 19, 1996
GENERAL INFORMATION
DATE, TIME, PLACE OF MEETING
This Proxy Statement and accompanying proxy and 1996 Annual Report are being
mailed on or about July 16, 1996, to the shareholders of Rentrak Corporation
(the "Company") in connection with the solicitation by the Board of Directors of
the enclosed form of proxy for the Annual Meeting of Shareholders to be held
Monday, August 19, 1996, at 8:00 a.m. Pacific Daylight Time (the "Annual
Meeting"), at the Heathman Hotel, 1001 S.W. Broadway, Portland, Oregon, 97205.
PURPOSES OF ANNUAL MEETING
The Annual Meeting has been called for the following purposes: (i) to elect two
(2) Class II Directors to serve a term of three (3) years; (ii) to hear and
consider reports from Officers of the Company; and (iii) to transact such other
business as may properly come before the meeting or any adjournments thereof.
The Company's Amended and Restated Bylaws set forth procedures to be followed
for introducing business at a shareholders meeting.
All shares represented by the enclosed proxy, if it is received prior to the
meeting, will be voted in the manner specified by the shareholder. To the
extent authority is not specifically withheld to vote for the nominees for
directors, the shares represented by the proxy will be voted FOR such nominees
and in such manner as the persons named in the proxies shall deem appropriate to
effect the recommendations of the Board.
The Company has no knowledge of any other matters to be presented at the
meeting. In the event other matters do properly come before the meeting in
accordance with the Company's Amended and Restated Bylaws, the persons named in
the proxy will vote such proxies in accordance with their judgment on such
matters.
REVOCATION OF PROXIES
The execution of a proxy will in no way affect a shareholder's right to attend
the meeting and vote in person. Any shareholder may revoke their proxy either
by giving written notice of such revocation to the Secretary of the Company at
its principal executive offices at 7227 Northeast 55th Avenue, Portland, Oregon
97218, prior to the Annual Meeting or by revoking it in person at the Meeting.
A proxy will also be revoked upon timely receipt by the Company of a properly
executed later dated proxy covering the same shares as the earlier proxy.
1
<PAGE>
SOLICITATION OF PROXIES
Proxies in the form enclosed with this Proxy Statement are being solicited by
the Board of Directors of the Company for use at the Annual Meeting. The two
persons named as proxies in the proxy have been selected by the Board of
Directors and will vote all shares for which valid proxies are granted to them.
Unless otherwise specified in the proxy, the proxy will be voted to ELECT as
Directors all of the nominees listed under Proposal 1 below.
The cost of soliciting proxies for the Annual Meeting will be borne by the
Company. In addition to solicitation by mail, directors, officers and employees
of the Company may solicit proxies from shareholders of the Company, personally
or by telephone or telegram, without receiving any additional remuneration.
Brokerage houses, nominees and other fiduciaries have been requested to forward
soliciting materials to beneficial owners and will be reimbursed for their
expenses by the Company.
1997 SHAREHOLDER PROPOSALS
The deadline for shareholders to submit proposals to be considered for inclusion
in the Proxy Statement for the 1997 Annual Meeting of Shareholders is no later
than March 18, 1997.
VOTING SECURITIES
Only holders of record of the Company's Common Stock on June 28, 1996, the
record date fixed by the Board of Directors for the Annual Meeting, shall be
entitled to notice of, and to vote at, the Annual Meeting and any adjournments
thereof. On June 28, 1996, 12,139,639 shares of Common Stock, .001 par
value, were outstanding and held of record by 409 shareholders. All outstanding
shares of Common Stock are to be voted as a single class, and each share of
Common Stock is entitled to one vote. The presence, in person or by proxy, of
the holders of a majority of the outstanding shares of Common Stock constitutes
a quorum. Assuming the existence of a quorum, the affirmative vote of a
plurality of shares of the Common Stock voting at the Annual Meeting, in person
or by proxy, will be required to elect persons to the Board of Directors.
Holders of Common Stock are not entitled to cumulate their votes in the election
of Directors. As a result, the holders of more than 50% of the shares voting
for the election of Directors can elect all of the Directors if they choose to
do so.
With regard to the election of directors, abstention from voting and broker non-
votes will have no effect on the outcome of the election, because directors will
be elected by a plurality of the shares of Common Stock for directors.
PROPOSAL 1
ELECTION OF DIRECTORS
Staggered Terms
- ---------------
The Company's Amended and Restated Bylaws provide that the Board of Directors,
presently consisting of six directors, be divided into three classes: Class I,
Class II and Class III. At this Annual Meeting, the
2
<PAGE>
shareholders are being asked to elect the two (2) Class II directors, Messrs.
Muneaki Masuda and Mr. Stephen Roberts for terms of three (3) years. Each
director holds office until the annual meeting at which his or her respective
term expires and until his or her successor is duly elected and qualified. If
vacancies occur, the Board of Directors may elect a replacement to serve for the
remainder of the unexpired term.
The nominees for election as members of the Board of Directors are presently
members of the Board and were elected by the shareholders to three year terms at
the 1993 Annual Meeting of Shareholders. Except as described in this paragraph,
no arrangement or understanding exists between any of the directors pursuant to
which any of them were selected to such position. Pursuant to a Common Stock
Purchase Agreement entered into as of December 20, 1989 with Culture Convenience
Club, Co., Ltd. ("CCC"), a Japanese Corporation, the Company's Board of
Directors is required, subject to fiduciary obligations to all shareholders, to
nominate Mr. Muneaki Masuda, CCC's designee, as a Director and use its best
efforts to vote in favor of Mr. Masuda those shares for which the Company's
management and Board hold proxies or are otherwise entitled to vote. Mr. Masuda
is up for election at this Annual Meeting. The nominees for director and
certain background information about them is set forth below:
Nominees for Class II Directors (Terms Expire in 1999)
- ------------------------------------------------------
Muneaki Masuda (46). Mr. Masuda founded Rentrak Japan, a joint venture formed
- -------------------
with CCC of which the Company owns a one-fourth equity interest and CCC's parent
company is controlling stockholder. Mr. Masuda also has served as President and
Chairman of CCC since December 1988. Mr. Masuda was first elected to the Board
of Directors of the Company on August 17, 1990.
Stephen Roberts (58). In July 1990, Mr. Roberts formed R&G Video, which
- --------------------
acquired the home video rights for the New World film library. Mr. Roberts is a
member of the Academy of Motion Pictures Arts and Sciences, the Academy of
Television Arts and Sciences, and a former director of the Motion Picture
Association of America. Mr. Roberts was elected to the Board of Directors of
the Company in December 1988 and currently serves as a consultant to the
Company.
The Board of Directors has no reason to believe that any of the nominees will be
unable to serve as a Director. In the event, however, of the death or
unavailability of any nominee or nominees, the proxy will be voted for such
other person or persons as the Board of Directors may recommend. Proxies cannot
be voted for more than two (2) nominees.
The Board of Directors recommends a vote FOR the election of each of the
nominees for Director.
Directors Whose Terms of Office Continue
- ----------------------------------------
The remaining Class III and Class I directors whose terms have not yet expired
and are therefore not standing for election this year are as follows:
Class III Directors (Terms Expire in 1997)
- ------------------------------------------
Ron Berger (48). Since founding the Company in 1977, Mr. Berger has served as
- ---------------
President and Chief Executive Officer, except for brief periods in other
positions in 1981 and 1984. Since September 1984, he has also served as the
Company's Chairman of the Board. Mr. Berger also serves as a member of the
3
<PAGE>
Board of Directors of American Contractors Indemnity, Los Angeles, California.
Mr. Berger serves as a member of the Board of Directors of the International
Franchise Association and of the Video Software Dealers Association.
James Jimirro (59). Since 1986, Mr. Jimirro has been the Chairman of the Board
- ------------------
of Directors, President and Chief Executive Officer of J2 Communications, a
program supplier to the Company. Mr. Jimirro was elected to the Board of
Directors of the Company in November 1990.
Bill LeVine (76). In January 1988, Mr. LeVine founded and became President of
- ----------------
LeVine Enterprises, Inc., an investment firm. Mr. LeVine is also a past member
of the Board of Directors of the International Franchise Association. Mr.
LeVine serves as a Director of the First Business Bank of Los Angeles,
California, B.C.T. Inc., of Fort Lauderdale, Florida, Fast Frame of Los Angeles,
California and California Closet of San Francisco, California. Mr. LeVine was
elected to the Board of Directors of the Company in April 1985.
Class I Directors (Terms Expire in 1998)
- ----------------------------------------
Peter Dal Bianco (48). Mr. Dal Bianco founded and has served as President of
- ---------------------
Pamley Enterprises, Ltd. ("Pamley") since November 1975. Pamley owns a number
of audio-video retail outlets and participates in the PPT Program. Mr. Dal
Bianco has been a Director of the Company since September 1984.
In addition, there is one additional Class I directorship which became vacant
upon the death of Mr. L. Barton Alexander.
See "CERTAIN RELATIONSHIPS AND TRANSACTIONS" for a discussion of certain
- ---
agreements and relationships between the Company and its directors.
Committees and Meetings of the Board
- ------------------------------------
The Board of Directors has a Compensation Committee and an Audit Committee.
Through March 26, 1996 there was also a Stock Option Committee comprised of
Messrs Jimirro and LeVine. As of March 26, 1996 the Stock Option Committee was
disbanded and all duties performed by it were transferred to the Compensation
Committee. During Fiscal 1996, the Compensation Committee was comprised of
James Jimirro, Bill LeVine and Stephen Roberts and was responsible for
evaluating the performance of the Company's management and determining the
method of compensating the Company's salaried employees. The Stock Option
Committee (Compensation Committee subsequent to March 26, 1996) is responsible
for administering and granting options under the Company's 1986 Second Amended
and Restated Stock Option Plan. During the fiscal year ended March 31, 1996,
the Compensation and Stock Option Committees held six (6) meetings,
respectively.
The Audit Committee is comprised of Peter Dal Bianco, Bill LeVine and Stephen
Roberts and is responsible for evaluating the integrity of the Company's
financial reporting to shareholders. During the fiscal year ended March 31,
1996, the Audit Committee met five (5) times. The Board does not have a
nominating committee.
During the fiscal year ended March 31, 1996, there were six (6) regular meetings
of the Company's Board of Directors which were held in person and nine (9)
special meetings which were conducted by telephone conference call. Each
Director attended at least 75% of the total number of meetings held by the Board
of Directors and the committees of the Board of Directors on which he served
during the fiscal year ended 1996 except for Muneaki Masuda who attended 60
percent of the Company's Board meetings.
4
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act of 1934
- --------------------------------------------------------------------
Section 16(a) of the 1934 Act requires the Company's directors and executive
officers and persons who own more than ten percent of the outstanding shares of
the Company's common stock ("ten percent shareholders"), to file with the SEC
initial reports of beneficial ownership and reports of changes in beneficial
ownership of shares of common stock and other equity securities of the Company.
To the Company's knowledge, based solely on review of the copies of such reports
furnished to the Company or otherwise in its files and on written
representations from its directors, executive officers and ten percent
shareholders that no other reports were required, during the two fiscal years
ended March 31, 1995 and March 31, 1996, the Company's officers, directors and
ten percent shareholders complied with all applicable Section 16(a) filing
requirements except that on one occasion during fiscal 1996, Michael
Lightbourne, an officer of the Company, failed to timely file a required report
on Form 4, Statement of Change of Beneficial Ownership of Securities.
5
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND DIRECTORS
The following table sets forth, as of May 31, 1996, information furnished to the
Company with respect to the ownership of the Company's Common Stock by each of
the Company's directors and nominees to the Board of Directors, the Chief
Executive and the named executive officers, all officers and directors as a
group, and each person (including any group) known by the Company to be
beneficial owner of more than 5% of the Company's Common Stock.
<TABLE>
<CAPTION>
--------------------------------------------
Amount and
Nature of Percent
Name & Address of Beneficial Of Shares
Beneficial Owner (1) Ownership Outstanding
- ---------------------------------- --------------------------------------------
<S> <C> <C>
Ron Berger 902,851 (2) 7.44%
F. Kim Cox 135,216 (3) 1.11%
Peter Dal Bianco 222,330 (4) 1.83%
Jim Jimirro 26,667 (5) *
Bill Levine 450,831 (6) 3.71%
Michael Lightbourne 227,100 (7) 1.87%
Muneaki Musada 416,000 (8) 3.43%
Stephen Roberts 190,522 (9) 1.57%
Jim Weiss 8,750 (10) *
All Officers and
Directors as
a group (13 persons) 2,708,742 22.31%
- ---------------------------------
</TABLE>
(*) Less than 1.00%
(1) The address of each of the directors is the Company's address, 7227 N.E.
55th Avenue, Portland, Oregon 97218.
(2) Includes 75,000 shares of Common Stock held by Mr. Berger's parents and
490,000 shares of Common Stock subject to options exercisable within 60
days of the date of the table. Mr. Berger disclaims beneficial
ownership of all shares held by his parents.
(3) Includes 133,212 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
(4) Includes 30,000 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
(5) Includes 26,667 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
(6) Includes 20,000 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
(7) Includes 109,000 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
(8) Mr. Musada is an officer and controlling shareholder of Culture
Convenience Club Co., Ltd. and therefore includes 386,000 shares owned
by Culture Convenience Club Co., Ltd. Also includes 30,000 shares of
Common Stock exercisable within 60 days of the date of the table.
(9) Includes 153,540 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
(10) Includes 8,750 shares of Common Stock subject to options exercisable
within 60 days of the date of the table.
Unless otherwise indicated in the notes to the foregoing table, beneficial
ownership of each of the shares of Common Stock listed in the foregoing table is
comprised of sole voting power and sole investment power.
6
<PAGE>
EXECUTIVE OFFICERS
The following table identifies the executive officers of the Company as of March
31, 1996, the age of each executive, the positions they hold, the year in which
they began serving in their respective capacities, and their past business
experience:
<TABLE>
<CAPTION>
Position Current Position(s)
Held with Company and
Name Age Since Past Business Experience
- ---- --- ----- ------------------------
<S> <C> <C> <C>
Ron Berger 48 1984 President, Chief Executive Officer and
Chairman of the Board; Since founding the
Company in 1977, Mr. Berger has served as
President and Chief Executive Officer,
except for brief periods in other
positions in 1981 and 1984. Since
September 1984, he has also served as the
Company's Chairman of the Board. Mr.
Berger also serves as a member of the
Board of Directors American Contractors
Indemnity and as a member of the Board of
Directors of the Video Software Dealers
Association and of the International
Franchise Association.
F. Kim Cox 43 1995 Executive Vice President, Chief Financial
Officer, Secretary, Treasurer; From 1991
until 1995, Mr. Cox served as Executive
Vice President -Strategic Planning,
Secretary, Treasurer; From 1985 until
June 1, 1991, Mr. Cox served as Chief
Financial Officer and Vice President
Finance. Prior to joining the Company in
1985, Mr. Cox was a practicing attorney
with the firm of Garvey, Schubert, Adams
& Barer from 1983 to 1985, and with the
firm of McClaskey & Greig from 1980 to
1983. Prior to that, Mr. Cox practiced
accounting with the firm of Arthur
Andersen & Co.
Michael R. Lightbourne 49 1992 Senior Vice President - Marketing. Prior
to joining the Company as Director of
Sales in September of 1988, Mr.
Lightbourne was President and founder of
MRL Enterprises, a sales and marketing
consulting firm which he began in 1982.
Mr. Lightbourne was Vice President -
Marketing from 1990 until 1992.
James P. Weiss 47 1994 Senior Vice President - Operations. Prior
to joining the Company in September 1994,
Mr. Weiss served as Regional Sales
Manager and Regional Vice President of
Ingram Entertainment from 1992-1994. Mr.
Weiss served as General Manager with
Commtron Corp. from 1982 until 1987 and
Regional Manager from 1991-1992. From
1987 to 1991, Mr. Weiss was Vice
President, Western Region, with Video
Trend.
</TABLE>
7
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth all compensation paid by Rentrak to the
Chief Executive Officer and the executive officers whose salary and bonus for
the last completed fiscal year exceeds $100,000 (the "Named Executive Officers")
for the fiscal years ended March 31, 1996, 1995 and 1994.
<TABLE>
<CAPTION>
Summary Compensation Table
Annual Compensation Long-Term Compensation
--------------------------------- ----------------------------------------
Awards Payouts
------------------------- ----------
All
Fiscal Other Restricted Securities Other
Year Annual Stock Underlying Compen-
Name and Ended Salary Bonus Compen- Award(s) Options/ LTIP sation
Principal Position March 31, ($) ($) sation($) ($) SARS(#) Payouts($) ($)(1)
- ------------------------ ----------- ---------- --------- ----------- ---------- ---------- ---------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ron Berger, President 1996 315,833 258,881 (3) n/a n/a - n/a 28,438
and Chief Executive 1995 277,036 59,623 n/a n/a 2,000,000 (2) n/a 9,415
Officer 1994 217,229 4,200 n/a n/a 120,000 n/a 17,415
Michael Lightbourne, 1996 153,708 39,000 (3) n/a n/a - n/a 5,661
Senior Vice President 1995 150,000 6,304 n/a n/a 3,000 n/a 6,635
Marketing 1994 150,000 25,000 n/a n/a 10,000 n/a 11,809
F. Kim Cox, 1996 150,583 25,000 (3) n/a n/a 200,000 n/a 5,375
Executive Vice 1995 132,677 53,938 n/a n/a 10,000 n/a 5,996
President 1994 108,391 2,120 n/a n/a 10,000 n/a 9,096
Jim Weiss, 1996 127,656 28,265 (3) n/a n/a 10,000 n/a 2,757
Senior Vice President,
Operations
</TABLE>
- ------------------------
(1) Amounts disclosed in this column reflect the following matching
contributions on behalf of the named executives with regard to Rentrak's
401K plan: Ron Berger $2,310. Michael Lightbourne $1,694 and F. Kim Cox
$1,848. The Company also made payments to supplemental disability and
life insurance plans for the following: Ron Berger $26,128, Michael
Lightbourne $3,967, F. Kim Cox $3,527 and Jim Weiss $2,757.
(2) The securities listed pertain to one option for 1,000,000 shares that
was cancelled and a replacement option covering 1,000,000 shares.
(3) These amounts were awarded based on fiscal 1995 results, but were paid
during fiscal 1996. No bonuses were awarded to these individuals based
on fiscal 1996 results.
8
<PAGE>
Stock Option Awards
- -------------------
Information concerning grants of stock options to the Named Executive Officers
during fiscal year 1996 is stated below. Under regulations of the Security and
Exchange Commission the assumed rates of appreciation of 5% and 10% are required
to be used. These assumed appreciation rates are not based on historic
performance of the Corporation's Common Stock or any other stock or stock index.
Any appreciation in the value of the stock options will only occur if the Common
Stock increases in value. Changes in the market price of the Common Stock
depend on future performance of the Corporation as well as overall stock market
performance. There can be no assurance that the amounts or rates of
appreciation stated in the following table will be achieved.
Options Granted in Fiscal 1996
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Percent of Annual Rates of Stock
Total Price Appreciation
Options for option term($)(3)
Options Granted to Exercise Expiration ----------------------------
Name Granted(1) Employees Price($)(2) Date 5% 10%
- -------------------- -------------- ----------- ------------- ------------ ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
F. Kim Cox 130,000 (4) 21.0 5.000 04/19/2001 408,785 1,035,957
70,000 (5) 11.3 6.09375 05/30/2005 268,261 679,856
Jim Weiss 10,000 (6) 1.6 5.00 04/25/2005 31,445 79,689
- --------------------
</TABLE>
(1) The options were granted pursuant to the Company's 1986 Second Amended
and Restated Stock Option Plan ("1986 Plan"). The Company's 1986 Plan is
administered by the Compensation Committee which determines to whom the
options are granted, the number of shares subject to each option, the
vesting schedule and the exercise price. Prior to March 26, 1996, the
Stock Option Committee, a subcommittee of the Compensation Committee,
administered the Company's 1986 Plan. The options granted in fiscal year
1996 vest in equal annual installments over four years, except for
14,000 options which all vest on May 31, 2000. The options may be
exercised for a period of one month following termination of employment,
except that under certain circumstances options expire at the time of
termination.
(2) The exercise of all options approximated fair market value at the date
of grant.
(3) Potential realizable value is based on the assumption that stock price
of the Common Stock appreciates at the annual rate shown (compounded
annually) from the date of grant until the end of the ten year option
term. These numbers are calculated based on the requirements promulgated
by the Securities Exchange Commission and do not reflect the Company's
estimate of future stock performance.
(4) These options were granted on April 20, 1995.
(5) These options were granted on May 31, 1995.
(6) These options were granted on April 25, 1995.
9
<PAGE>
Stock Option Exercises
- ----------------------
The following table sets forth information concerning stock option
exercises by the Named Executive Officers for fiscal year ended March 31, 1996
and the value of in-the-money options (i.e., options in which the market value
of Rentrak Common Stock exceeds the exercise price of the options) held by such
individuals on March 31, 1996. No stock appreciation rights ("SAR's") have been
granted to, or are currently held by, the Named Executive Officers. The value of
the in-the-money options is based on the difference between the exercise price
of such options and the closing price of Rentrak Common Stock on March 31, 1996,
which was $5.25. The value realized on exercised options is based on the
difference between the exercise price for the options and the closing price of
Rentrak Common Stock on the date of exercise.
Aggregate Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Securites Value of Unexercised
Underlying Unexercised In-the-Money Options
Shares Options/SARS at FY-End at FY-End ($)
Acquired on Value
Exercise Realized (#)Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
- -------------------- ------------ ---------- ------------------------ -------------------------
<S> <C> <C> <C> <C>
Ron Berger 20,000 88,760 460,000 / 660,000 22,500 / 22,500
Michael Lightbourne - - 103,250 / 129,750 36,875 / 1,875
F. Kim Cox - - 78,125 / 145,000 135,000 / 34,376
Jim Weiss - - 6,250 / 28,750 - / 2,500
</TABLE>
Compensation of Directors
- -------------------------
Through September 30, 1995, the Company compensated Directors, other
than employees who are Directors, for their services by payment of $1,000 for
each Board meeting attended and $500 for each telephone conference Board
meeting. In addition, each non-employee Director was paid an annual board fee
of $10,000. As of October 1, 1995 the annual board fee was increased to $15,000
and payment for each Board meeting attended was reduced to $500. The Company
also reimburses Directors for their travel expenses for each in person meeting
attended. During fiscal year 1996, each non-employee Director was granted an
option to acquire 5,000 shares of the Company's Common Stock pursuant to the
Company's Amended and Restated Directors Stock Option Plan. Automatic grants of
such options to non-employee Directors occur annually under the Company's
Amended and Restated Directors Stock Option Plan on April 1, of each year.
10
<PAGE>
Employment Agreements.
- ---------------------
Ron Berger Effective June 1, 1994, the Company entered into an Employment
----------
Agreement with Mr. Berger. Under this Agreement, Mr. Berger is employed as the
Chairman of the Board of Directors, Chief Executive Officer and President of the
Company and will receive an annual base salary of $300,000 for the period ending
March 31, 1996, subject to automatic increases as set forth in the Agreement for
each subsequent year up to $390,000 for the period ending May 31, 1999. Mr.
Berger is also entitled to receive certain cash bonuses under formulae based
upon the Company's pre-tax profits. Mr. Berger is entitled to receive all of
the compensation set forth in the Agreement for the term of the Agreement if he
is terminated for certain reasons other than for cause. If Mr. Berger is
terminated for cause, he will receive only the full amount of all compensation
accrued as of the date of termination. In the event of a change of control of
the Company, Mr. Berger may elect to receive severance equal to the greater of
the remaining compensation under the Agreement or three times the amount
received in the prior fiscal year. If Mr. Berger is terminated due to his death
or disability, he (or his estate or legal representative) is entitled to receive
the compensation set forth in the Agreement for one year following termination.
The Agreement expires on May 31, 1999.
F. Kim Cox Effective April 20, 1995, the Company entered into an Agreement
----------
with Mr. Cox. Under this Agreement, Mr. Cox is employed as the Executive Vice
President of the Company. Mr. Cox receives an annual salary of $160,000. Mr.
Cox is entitled to receive all of the compensation set forth in the Agreement
for one year if he is terminated other than for cause (subject to reduction
should Mr. Cox obtain other employment). On April 20, 1995, Mr. Cox was granted
a stock option to acquire 130,000 shares of the Company's Common Stock at an
exercise price of $5.00 per share. On May 31, 1995, Mr. Cox was granted a stock
option to acquire 70,000 shares of the Company's Common Stock at an exercise
price of $6.09375 per share. The Employment Agreement expires on April 19,
1999.
Michael R. Lightbourne Effective April 1, 1995, the Company entered into an
----------------------
Agreement with Mr. Lightbourne for a term of five and one-quarter years.
Pursuant to the Agreement, Mr. Lightbourne is entitled to receive a base salary
of $150,000 in fiscal year 1995-1996, $157,500 in fiscal year 1996-1997,
$167,500 in fiscal year 1997-1998, $175,000 in fiscal year 1998-1999 and $46,500
for the three month period ending June 30, 1999. The Company may terminate the
Agreement without advance notice, in which case Mr. Lightbourne is entitled to
receive an amount equal to his annual salary for the prior year (subject to
reduction should Mr. Lightbourne obtain other employment). Mr. Lightbourne is
entitled to receive the base salary for the remainder of the term of the
Agreement if there is a change of control of the Company.
James P. Weiss Effective October 3, 1994, the Company entered into an
--------------
Employment Agreement with Mr. James P. Weiss. Under this Agreement Mr. Weiss is
employed as a Senior Vice President. Mr. Weiss will receive an annual base
salary of $125,000. Upon commencement of the Agreement, Mr. Weiss received an
option to acquire 25,000 shares of the Company's Common Stock at an exercise
price of $6.75. If Mr. Weiss is terminated other than for cause, he will
receive an amount equal to six months of base salary (subject to reduction
should Mr. Weiss obtain other employment).
REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEES ON THE COMPENSATION OF
THE CHIEF EXECUTIVE OFFICER AND ALL EXECUTIVE OFFICERS.
The "Report of the Compensation and Stock Option Committees on the compensation
of the Chief Executive Officer and All Executive Officers" shall not be deemed
incorporated by reference by any general statement incorporating this proxy
statement into any filing under the Securities Act of 1933 or
11
<PAGE>
under the Securities Exchange Act of 1934, except to the extent that the Company
specifically incorporates this information by reference, and shall not otherwise
be deemed filed under such Acts.
The Compensation Committee and Stock Option Committees of the Company determine
the compensation of all executive officers of the Company, including Ron Berger,
Chairman of the Board and Chief Executive Officer of the Company. Compensation
decisions for all executive officers of the Company are based on the Company's
executive compensation philosophy. This compensation philosophy has four
primary principles: (i) link executive compensation to the creation of
sustainable increases in shareholder value; (ii) provide executive compensation
rewards contingent upon organizational performance; (iii) differentiate
compensation based on individual executive contribution; and (iv) encourage the
retention of a sound management team.
To implement this philosophy, the Compensation Committee and Stock Option
Committees structure executive compensation employing three primary components -
annual salary, performance bonuses and a long-term incentive program consisting
of stock option grants. The Compensation Committee is responsible for
administering the Company's Second Amended and Restated 1986 Stock Option Plan.
Ownership of shares of Rentrak Common Stock by executives is encouraged and
forms a significant component of the total executive compensation package. The
higher the position of the executive, the greater the percentage his
compensation is likely to consist of long-term incentive programs. In addition,
the Compensation and Stock Option Committees looks to competitive factors in the
development of total executive compensation packages.
Annual Salary and Performance Bonuses
The Compensation Committee fixes the yearly salary of each executive officer.
The yearly salary reflects the level of duties and responsibilities of the
executive officer, the executive officer's experience and prior performance,
industry practices and the financial performance of the Company in both absolute
and relative terms. Salaries are reviewed annually by the Compensation
Committee and are increased when warranted by executive performance and
competitive practices. In establishing various compensation levels for
executive officers, including the Chief Executive Officer, the Compensation
Committee took into account the record levels of revenue generated by domestic
PPT, management's commitment to developing new products and management's effort
to diversify its business.
The Compensation Committee also awards performance bonuses. Performance
bonuses, if earned, are generally paid once the Company's fiscal year end
results are known. Performance bonuses are based upon: (i) the executive
officer's performance against individual goals; (ii) the performance of the
executive officer's unit within the Company against that unit's goals; and (iii)
the performance of the Company against Company goals. Goals vary from year to
year and from unit to unit and, with regard to executive officers, usually
include both quantitative and qualitative factors. In fixing the bonuses for
fiscal 1996, quantitative goals evaluated by the Compensation Committee included
goals based on specific profit targets. Qualitative goals included goals based
on strategic positioning and business development.
From time to time, the Compensation Committee has awarded one-time bonus
payments to certain executive officers as a result of extraordinary
circumstances, such as the consummation of financing or the attainment of
special unit goals.
12
<PAGE>
Long-Term Incentive Program
Stock option grants are used to motivate employees to focus on the long-term
performance of the Company. The Company has long maintained stock option plans
for all qualified employees, including all executive officers. The Stock Option
Committee (Compensation Committee subsequent to March 26, 1996) fixes the terms
and the size of the grants of stock options to all recipients, including all
executive officers. The size of the grants is based upon the employee's duties,
responsibilities, performance, experience and anticipated contribution to the
Company.
In fiscal 1996, the Company granted stock options to all executive officers
except Ron Berger and Michael Lightbourne. The Stock Option Committee typically
awards stock options to executive officers on an annual basis in the exercise of
their discretion. Additional grants may be made in the event of an executive
officers promotion.
Compensation of Ron Berger, Chairman of the Board and Chief Executive Officer
Ron Berger has served as Chairman of the Board and Chief Executive Officer of
the Company since September 1984. In fixing salary and target bonus levels, as
well as determining the size of his stock option grants, the Compensation and
Stock Option Committees reviewed the financial performance of the Company,
including revenue and profit levels as compared to the Company's performance
goals. In addition, the Compensation and Stock Option Committees reviewed the
following factors: Mr. Berger's performance as Chairman of the Board and Chief
Executive Officer, his importance to the Company and the successful
implementation of its strategic goals and the compensation packages of chief
executive officers of other comparably sized companies.
In fiscal 1996, Mr. Berger was not awarded a bonus or any stock options.
By: The Rentrak Corporation Compensation Committee:
James Jimirro Bill LeVine Stephen Roberts
By: The Rentrak Corporation Stock Option Committee:
James Jimirro Bill LeVine
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1996, the Compensation Committee had the following members: James
Jimirro, Bill LeVine and Stephen Roberts. Stephen Roberts provided consulting
services to the Company during fiscal 1996, for which he received $104,154,
options to purchase 9,187 shares of the Company's Common Stock at $6.063, 15,255
shares at $5.813, and 17,640 shares at $4.781 all of which were issued at fair
market value at date of grant. The Company will continue to use Mr. Roberts as
a consultant during fiscal 1997.
13
<PAGE>
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN OF RENTRAK CORPORATION NASDAQ
MARKET INDEX AND PEER INDUSTRY GROUP.
The Chart on page 18 compares the five year cumulative total return on Rentrak's
Common Stock with that of the NASDAQ Market index and a peer industry group.
This graph assumes $100 was invested on April 1, 1991 in the Company's Common
Stock, the NASDAQ market index and the peer group index. The peer group is
composed of: Alliance Communication CP CL B, Alliance Gaming Corp., Alpha
Hospitality CP, American Bingo & Gaming, American Casino Enterprises, American
Cinemastores, American Recreation Centers, Anchor Gaming, Argosy Gaming Company,
Bowl American, Inc., Brassie Golf Corp., Casino America, Inc., Cedar Fair L.P.,
Celebrity Entertainment, Century Casinos Inc., Cinema Ride, Inc., Colorado
Casino Resorts, Datatrend Services, Inc., Digital Communications Technology,
Inc., Dove Audio, Inc., Encore Marketing Int, Family Golf Centers, Inc., First
Entertainment, Inc., Gaming CP of America, Gaming World International, Golf
Enterprises, Inc., Grand Gaming CP, Handleman Company, Hollywood Entertainment,
Image Entertainment, Inc., Imax CP, Inland Casino Corp, Integrity Music, Inc.,
Internat Lottery, Inc., Internat Post Limited, Irata, Inc. CL A, ITT Corp,
Jackpot Enterprises, Inc., Jillian's Entertainment, K-Tel International, Inc.,
Live Entertainment, Inc., Livent Inc., Lone Star Casino CP, Master Glazier's
Karate, Moovies Inc., Mountasia Entertain, Inc., Movie Gallery, Inc., Musicland
Stores CP, National Lodging Corp, Navarre CP, Pinnacle Systems, Inc., Platinum
Entertainment, Players Internat, Inc., Premiere Radio Network Cla, Quality Dino
Entertain, Quintel Entertainment, Renaissance Entertainment CP, Senior Tour
Players Dev, Sky Games Internat LTD, Skylands Park Management, Skyline
Multimedia Ent, Southshore CP, Spec's Music, Inc., Stratosphere CP, TM Century,
Inc., Trans World Entertain CP, Unitel Video, Inc., Vaughn's Communications,
Video Lottery Techns, Inc., and Video Updates, Inc. CL A.
The following Chart shall not be deemed incorporated by reference by any general
statement incorporating this proxy statement into any filing under the
Securities Act of 1933 or under the Securities Exchange Act of 1934, except to
the extent that the Company specifically incorporates this information by
reference, and shall not otherwise be deemed filed under such Acts. The chart
assumes $100 invested on April 1, 1991 and any dividends were reinvested.
14
<PAGE>
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
AMONG RENTRAK CP, PEER GROUP INDEX AND NASDAQ MARKET INDEX
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year Covered) Rentrak CP Peer Group NASDAQ Market Index
- --------------------- ---------- ---------- -------------------
<S> <C> <C> <C>
Measurement PT -
3/31/91 $100 $100 $100
FYE 3/31/92 $110.64 $123.52 $105.40
FYE 3/31/93 $ 97.87 $142.60 $117.95
FYE 3/31/94 $ 85.11 $178.11 $136.32
FYE 3/31/95 $110.64 $141.21 $144.62
FYE 3/31/96 $ 89.36 $142.31 $194.52
</TABLE>
15
<PAGE>
CERTAIN RELATIONSHIPS AND TRANSACTIONS
Peter Dal Bianco, a stockholder and member of the Company's Board of Directors,
holds an interest in several retail outlets participating in the Company's PPT
system. The Company realized revenues from these outlets of $181,111 during
fiscal 1996. The Company expects to continue to do business with Mr. Dal Bianco
in fiscal 1997.
Stephen Roberts, a member of the Company's Board of Directors, provided
consulting services to the Company during fiscal 1996, for which he received
$104,154, options to purchase 9,187 shares of the Company's Common Stock at
$6.063, 15,255 shares at $5.813, and 17,640 shares at $4.781 all of which were
issued at fair market value at date of grant. The Company will continue to use
Mr. Roberts as a consultant during fiscal 1997.
Marty Graham, an officer in the Company, holds an interest in two retail outlets
participating in the Company's PPT program. The Company realized revenues from
these outlets of $74,457 during fiscal 1996. The Company expects to continue to
do business with Mr. Graham in fiscal 1997.
Joshua Berger, son of Ron Berger, is the Art Director of a firm which was paid
$49,898 during the year for advertising space.
Pursuant to the Officer Loan Program, Ron Berger, Chief Executive Officer,
borrowed $375,000 from the Company during fiscal 1996. The loan, which accrued
interest at the prime rate, was paid back in full subsequent to March 31, 1996.
INDEPENDENT ACCOUNTANTS
The Company's independent public accountants for its fiscal year ended March 31,
1996, were Arthur Andersen LLP, which management will continue to retain during
the current fiscal year. No election, approval or ratification of the choice of
independent public accountant by the shareholders is required. A representative
of Arthur Andersen LLP is expected to be present at the Annual Meeting, will
have the opportunity to make a statement if he or she desires to do so, and is
expected to be available to respond to appropriate questions.
OTHER BUSINESS
Management does not presently know of any matters that will be presented for
action at the Annual Meeting other than those herein set forth. However, if any
other matters properly come before the Annual Meeting, the holders of proxies
solicited by the Board of Directors of the Company will have discretionary
authority to vote the shares represented by all proxies granted to them on such
matters in accordance with their best judgment.
FINANCIAL INFORMATION
A copy of the 1996 Annual Report of the Company, including audited financial
statements, is being sent to shareholders with this Proxy Statement.
16
<PAGE>
REPORT ON FORM 10-K
THE COMPANY'S ANNUAL REPORT ON FORM 10-K FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION FOR THE YEAR ENDED MARCH 31, 1996, WILL BE AVAILABLE TO SHAREHOLDERS
WITHOUT CHARGE UPON WRITTEN REQUEST TO CAROLYN A. PIHL, CHIEF ACCOUNTING
OFFICER, RENTRAK CORPORATION, 7227 N.E. 55TH AVENUE, PORTLAND, OR 97218. COPIES
OF EXHIBITS TO THE ANNUAL REPORT ON FORM 10-K ARE AVAILABLE, BUT A REASONABLE
FEE WILL BE CHARGED TO ANY SHAREHOLDER REQUESTING EXHIBITS.
By Order of the Board of Directors,
/S/ F. Kim Cox
- ----------------------------------
F. Kim Cox
Secretary
Portland, Oregon
Date: July 11, 1996
17
<PAGE>
[LOGO OF RETRAK CORPORATION APPEARS HERE]
RENTRAK CORPORATION
This Proxy is Solicited on Behalf of the Board of Directors.
The undersigned hereby appoints Ron Berger and F. Kim Cox as Proxies, each with
the power to appoint his substitute, and hereby authorizes them to represent and
to vote as designated below, all the shares of Common Stock of Rentrak
Corporation (the "Company") held of record by the undersigned June 28, 1996, at
the annual meeting of the shareholders to be held at the Riverplace Hotel, 1510
S.W. Harbor Way, Portland, Oregon, August 19, 1996, at 8:00 a.m., Pacific Time
or any adjournment thereof.
<TABLE>
<S> <C> <C>
1. Election of Directors [_] FOR all nominees listed [_] WITHHOLD AUTHORITY
To The Terms Specified: (except as marked to the to vote for all nominees
contrary below) listed below
</TABLE>
Instruction: To withhold authority to vote for any individual nominee, strike a
line through the nominee's name in the list below:
Muneaki Masuda (3 Years), Stephen Roberts (3 Years)
(Continued and to be dated and signed on other side)
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
This proxy, when properly executed, will be voted as directed herein. If no
direction is made, this proxy will be voted FOR the two nominees to the Board of
Directors of Rentrak Corporation.
Please date and sign exactly as name
appears hereon. When shares are held as
joint tenants, both should sign. When
signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by President or other
authorized officer. If a partnership,
please sign in partnership name by
authorized person.
Dated: , 1996
-----------------------
-----------------------------------------
Signature
-----------------------------------------
Signature if held jointly
Please mark, sign, date and return the proxy using the enclosed envelope
