SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 3)
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ x ]
Check the appropriate box:
[ x ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material under Rule 14a-12
Rentrak Corporation
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Name of Registrant as Specified In Its Charter
Paul A. Rosenbaum on behalf of the Committee
for the Achievement of Rentrak Excellence
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ x ] No fee required.
[ ] 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:
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2. Aggregate number of securities to which transaction applies:
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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):
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4. Proposed maximum aggregate value of transaction:
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5. Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] 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:
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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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COMMITTEE FOR THE ACHIEVEMENT OF RENTRAK EXCELLENCE
c/o Paul A. Rosenbaum
127 E. Washtenaw
Lansing, Michigan 48933
Dear Fellow Shareholders:
We are the beneficial owners of over 1.1 million shares of the
outstanding common stock of Rentrak Corporation ("Rentrak"). This amounts to 9.2
percent of the outstanding common stock, based on the numbers reported in the
amended annual report on Form 10-K filed by Rentrak with the Securities and
Exchange Commission on July 31, 2000. We believe that Rentrak has not made its
shareholders a priority and have formed the Committee for the Achievement of
Rentrak Excellence ("CARE") in an effort to improve the strategic direction of
Rentrak.
The annual meeting of the shareholders of Rentrak (the "Annual
Meeting") is scheduled to be held on September 19, 2000, at __ a.m. Pacific Time
at [Rentrak's executive offices located at One Airport Center, 7700 N.E.
Ambassador Place, Portland, Oregon 97220]. CARE is requesting your proxy for the
Annual Meeting.
At the Annual Meeting, CARE understands that the following CARE
proposals for action will be presented:
CARE Proposal 1: The amendment of Rentrak's Bylaws to provide for
five board positions
CARE Proposal 2: If CARE Proposal 1 passes, the election of five
persons nominated by CARE to serve as directors of
Rentrak
Following this letter you will find our proxy statement containing
information about the five individuals we intend to nominate for election as
directors of Rentrak. Please read the attached information carefully.
PLEASE SIGN AND DATE THE ENCLOSED BLUE PROXY CARD AND RETURN IT IN THE
ENCLOSED ENVELOPE AS SOON AS POSSIBLE. By returning the BLUE proxy card, CARE
will be able to vote on your behalf FOR CARE Proposal 1 described above and FOR
CARE's five nominees for director.
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In order to assist our efforts to assess the strength of our support,
PLEASE ALSO FAX A COPY OF YOUR SIGNED CARE PROXY CARD AS SOON AS POSSIBLE TO
PAUL A. ROSENBAUM AT (517) 487-8205.
Thank you for your support.
August , 2000 The Committee for the Achievement of Rentrak Excellence
---
Paul A. Rosenbaum
Michael J. Annechino
Mark A. Brown
Thomas S. Cousins, Jr.
Gordon R. Reck
Donald W. Remlinger
David R. Rosencrantz, M.D.
Guy R. Wolcott
Frederick L. Zehnder
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PROXY STATEMENT
OF
THE COMMITTEE FOR THE ACHIEVEMENT OF RENTRAK EXCELLENCE
ANNUAL MEETING OF SHAREHOLDERS
OF
RENTRAK CORPORATION
TO BE HELD SEPTEMBER 19, 2000
PLEASE SIGN, DATE, AND RETURN THE ENCLOSED
BLUE PROXY CARD TODAY!
The Committee for the Achievement of Rentrak Excellence ("CARE") is
furnishing this Proxy Statement and the accompanying BLUE proxy card in
connection with the solicitation of proxies for use at the annual meeting of
shareholders of Rentrak Corporation ("Rentrak") scheduled to be held at
[Rentrak's executive offices located at One Airport Center, 7700 N.E. Ambassador
Place, Portland, Oregon 97220], on Tuesday, September 19, 2000, at a.m. -----
(the "Annual Meeting"), or at any adjournments, postponements, or reschedulings
thereof. Rentrak is an Oregon corporation with offices located in Portland,
Oregon, at the location set for the Annual Meeting. The members of CARE are Paul
A. Rosenbaum, Michael J. Annechino, Mark A. Brown, Thomas S. Cousins, Jr.,
Gordon A. Reck, Donald W. Remlinger, David R. Rosencrantz, M.D., Guy R. Wolcott,
and Frederick L. Zehnder, who together beneficially own more than 1.1 million
shares, or what CARE believes to be approximately 9.2 percent, of the
outstanding Rentrak common stock. The address of the leader of CARE, Paul A.
Rosenbaum, is 127 E. Washtenaw, Lansing, Michigan 48933.
This Proxy Statement and accompanying BLUE proxy card are first being
mailed by CARE to Rentrak shareholders on or about August , 2000. The members
---
of CARE request that you sign, date, and deliver the enclosed BLUE proxy card
before September 8, 2000, by personal delivery or by mail (using the enclosed
postage prepaid envelope) to Beacon Hill Partners, Inc., 90 Broad Street, New
York, New York 10004.
The enclosed BLUE proxy card will enable you to vote FOR the following
proposals:
CARE Proposal 1: The amendment of Rentrak's Bylaws to provide for
five board positions.
CARE Proposal 2: If CARE Proposal 1 passes, the election of five
directors nominated by CARE to serve as directors
of Rentrak.
IMPORTANT NOTE: If your shares are held in the name of a brokerage
firm, bank, or other nominee (i.e., in "street name"), only the broker, bank,
etc. can execute a proxy with respect to your shares of common stock and only
upon receipt of your specific instructions. If
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you sign, date and mail the BLUE proxy card in the envelope provided, this will
be taken care of for you.
For assistance or further information, please contact Richard Grubaugh
at Beacon Hill Partners, Inc., 1-800-755-5001.
In order to assist our efforts to assess the strength of our support,
PLEASE ALSO FAX A COPY OF YOUR SIGNED CARE PROXY CARD AS SOON AS POSSIBLE TO
PAUL A. ROSENBAUM AT (517) 487-8205.
VOTING RIGHTS
Rentrak's Board of Directors has fixed the close of business on August
4, 2000, as the record date for determining the shareholders of Rentrak entitled
to notice of and to vote at the Annual Meeting and any adjournment thereof. On
that date, shares of common stock, $0.001 par value per share, of
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Rentrak were outstanding. Only holders of record of the shares of common stock
are entitled to vote at the Annual Meeting. Each share of Rentrak common stock
is entitled to one vote on such matters as may properly come before the Annual
Meeting or any adjournment thereof.
REASONS FOR THE SOLICITATION
The members of CARE have become increasingly concerned that neither the
current management nor the current directors of Rentrak have the strategic
vision required to maximize the value of Rentrak to its shareholders. The price
of Rentrak's stock has fallen from a high of $7.41 in the quarter ended December
31, 1999 to a closing price of $4.00 on August 7, 2000. Rentrak's revenues
declined $10.4 million from $123.8 million for the fiscal year ended March 31,
1999 to $113.4 million for fiscal 2000. Its income from continuing operations
declined from $6.3 million for fiscal 1997 to $1.1 million for the 2000 fiscal
year. The operating profit for fiscal 2000 included a $7.8 million gain on
settlement of litigation with Hollywood Entertainment; without this gain,
Rentrak would have had an operating loss of at least $6.7 million. Offsetting
the litigation settlement gain were increased reserves relating to an
outstanding receivable account and write-offs of other assets for a total of
approximately $9.0 million in the fourth quarter of fiscal 2000. Rentrak also
recognized a loss on sale of investments in fiscal 2000 of $1.2 million.
In 1992, Rentrak established a retailer financing program totaling up
to $18 million providing for loans or equity investments in video dealers that
were Rentrak customers and that Rentrak believed had potential for substantial
growth. At March 31, 1999, Rentrak had $14 million in loans or investments
outstanding under the program, of which $9.6 million was reserved as a valuation
allowance based on concerns regarding collectibility or impaired value. At March
31, 2000, due largely to write-offs of $5.1 million during fiscal 2000, the
amounts outstanding under the retailer financing program had declined to $6.9
million with reserves of $5.7 million. CARE believes this means that, of the $14
million extended under the retailer financing program, approximately $11 million
had either been written off or reserved for
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potential write-off at March 31, 2000, raising significant questions as to the
fiscal soundness of the program in its entirety.
In addition, members of Rentrak's management team have entered into
transactions that suggest to CARE that Rentrak's directors may lack the degree
of independent judgment that CARE deems desirable. For example, management
transactions disclosed in Rentrak's revised preliminary proxy materials filed
with the SEC on July 31, 2000, have disturbed CARE's members. S. Roberts
Company, owned by director Stephen Roberts, stands to receive no less than
$200,000 and up to 2% of the total consideration upon completion of certain
strategic dispositions of Rentrak assets prior to December 31, 2000, pursuant to
a consulting agreement with Rentrak entered into in April 2000. During fiscal
2000, Mr. Roberts received more than $142,000 from Rentrak for consulting
services. Director Dr. Pradeep Batra is president and controlling shareholder of
Unique Business Systems, which has entered into agreements with Rentrak and
Rentrak affiliates under which Unique Business Systems receives significant
compensation for the use of its point-of-sale software and customer referrals.
This compensation totaled $212,678 in fiscal 2000.
On May 19, 2000, Rentrak's board of directors approved amendments to
its Amended and Restated Directors Stock Option Plan and 1986 Second Amended and
Restated Stock Option Plan authorizing the extension of loans to directors and
employees in connection with exercises of vested options under the plans on
terms approved by the Compensation Committee of Rentrak's board of directors. On
June 16, 2000, Ron Berger, chairman and chief executive officer of Rentrak, and
F. Kim Cox, president of Rentrak, executed promissory notes providing for the
payment to Rentrak of $6,629,386.01 and $1,468,250.42, respectively, plus annual
payments of interest at the "Federal Funds" rate of 6.5 percent per annum.
According to Rentrak's revised preliminary proxy materials filed on July 31,
2000, these promissory notes were delivered in connection with the exercise of
stock options held by Messrs. Berger and Cox for a total of more than 1.6
million shares of Rentrak stock. The average exercise price of the options,
$4.87 per share, was nearly one dollar above the closing price of Rentrak stock
on the date of exercise ($3.875 per share).
Copies of the loan agreements with Messrs. Berger and Cox were filed
with the SEC by Rentrak on July 31, 2000, as exhibits to its amended annual
report on Form 10-K. Each loan is without recourse as to the principal amount of
the loan other than the shares of Rentrak stock pledged as collateral (1,362,008
shares by Mr. Berger and 301,518 shares by Mr. Cox). This means that, to the
extent the fair market value of the stock securing a loan is less than the
principal balance plus accrued and unpaid interest, Rentrak will not be entitled
to collect the deficiency (other than interest) from the borrower in the event
that he fails to repay the loan. Also, Rentrak may seek to collect interest
owing on the loan against the borrower only if any amount of interest remains
unpaid after selling or disposing of the pledged shares.
If a majority of directors not nominated by the incumbent board are
elected (as would be the case if CARE is successful in this proxy contest) or if
a change of control of Rentrak (as defined in the loan agreements) otherwise
occurs, each of Messrs. Berger and Cox is entitled, at his option and provided
that he is not then in default under the loan, to exercise the following rights:
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- terminate his loan agreement without further obligation except for
forfeiture of the shares pledged as collateral; or
- require Rentrak to purchase any or all of the shares pledged as
collateral at the market price at that time, with proceeds to be
applied first to the accrued interest and principal balance of the
loan and the excess, if any, paid to the borrower by Rentrak in
cash.
If Rentrak's stock price were to increase significantly above $5.00 per share,
even for just one day, following a change of control of Rentrak, the cash
requirements imposed on Rentrak by the exercise of the latter right could be
substantial.
The members of CARE view these loans, totaling more than $8 million to
Messrs. Berger and Cox and made just four days before the original record date
for the Annual Meeting (June 20, 2000), as evidence of the poor judgment
demonstrated by Rentrak's directors in managing Rentrak's affairs. The issuance
of 1,663,526 shares in exchange for the promissory notes of Messrs. Berger and
Cox results in substantial dilution to the rest of Rentrak's shareholders. If
the shares had been outstanding at April 1, 1999, Rentrak's basic earnings from
continuing operations for the fiscal year ended March 31, 2000, would have been
$.09 per share rather than the $.10 per share reported in Rentrak's financial
statements. In addition, Rentrak did not receive any cash in the option exercise
transactions, just promises to pay executed by Messrs. Berger and Cox. The first
interest payment is not even due for one year. The annual interest rate charged
on the loans, 6.5 percent, is 2.5 percentage points below the interest rate
applicable to Rentrak's bank line of credit at March 31, 2000, and 4 percentage
points lower than that provided for in a $3,000,000 line of credit extended to a
Rentrak subsidiary by Bill LeVine, one of Rentrak's directors. Finally, as noted
above, if the market price of Rentrak's stock remains below the purchase price
of the shares securing the loan and Mr. Berger and Mr. Cox, or either of them,
fails to repay his loan, Rentrak will not have the right to collect the unpaid
principal balance from the borrower's other assets and may only take back the
shares pledged as collateral. CARE believes that the terms of these loans are
significantly more favorable to Messrs. Berger and Cox than could be obtained in
an arm's length transaction with a third party.
CARE believes that the terms of the loans to Messrs. Berger and Cox
were approved either by Rentrak's Board of Directors as a whole or by its
Compensation Committee. The current members of the Compensation Committee are
Skipper Baumgarten, Takaaki Kusaka and Bill LeVine. Mr. Baumgarten is chief
executive officer of American Contractors Indemnity Co., a privately held
company of which Mr. Berger is a director. Mr. Berger is also Chairman of the
Board of Rentrak Japan, a major Rentrak shareholder, of which Mr. Kusaka is
president. In November 1999, Mr. LeVine received warrants expiring November 30,
2000, for 14,814 shares of common stock of 3PF.COM, Inc., a subsidiary of
Rentrak, at a purchase price of $6.75 per share in connection with a $4,000,000
loan extended by Mr. LeVine to Rentrak. The loan, which bore interest at 10
percent per annum, was repaid in full in January 2000. In addition, in August
1999, Rentrak's subsidiary Blowout Video Holding Company entered into an
agreement with Mr. LeVine providing for a $3,000,000 line of credit bearing
interest at prime plus 1.5 percent (10.5 percent at March 31, 2000) pursuant to
which Mr. LeVine also received a $30,000
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commitment fee and $12,500 in closing costs. CARE believes these multiple
cross-relationships among the members of the Compensation Committee are
indicative of a lack of independence when considering executive compensation
matters.
Also, in addition to Messrs. Berger and Cox, five of Rentrak's
directors and one of its officers exercised options or purchased stock on the
open market between June 8, 2000, and June 16, 2000 (just days before the
original record date for the Annual Meeting), as follows:
- 10,000 shares by Mr. Batra on June 8, 2000
- 10,000 shares by Mr. Baumgarten on June 15, 2000
- 17,500 shares by Mr. Jimirro on June 15, 2000
- 15,000 shares by Mr. LeVine on June 13, 2000
- 2,500 shares by Mr. Nida on June 8 and 13, 2000
- 15,000 shares by Mr. Roberts on June 9, 2000
This suggests to CARE that management is seeking to prevent itself from being
replaced by acquiring additional shares to vote at the Annual Meeting. Of
course, it is possible that Rentrak's officers and directors determined to
increase their share ownership in order to more closely align their interests
with those of Rentrak shareholders generally.
THE MEMBERS OF CARE SOLICIT YOUR VOTE IN FAVOR OF CARE PROPOSAL 1 AND
FOR ITS FIVE NOMINEES FOR DIRECTOR (CARE PROPOSAL 2).
RECENT EVENTS
Paul Rosenbaum, now the leader of CARE, has been concerned for over a
year that Rentrak's management has not been acting in the best interests of
Rentrak shareholders. Throughout the last half of 1999 and continuing into 2000,
Mr. Rosenbaum had several conversations with Ron Berger, chairman and chief
executive officer of Rentrak, and from time to time with persons associated with
Jackson Hole Advisors ("JHA"), Rentrak's financial and investor relations
advisor, concerning Rentrak's business prospects and goals.
In March 2000, Mr. Rosenbaum's dissatisfaction increased. Several
months had passed since Mr. Berger had publicly announced in October 1999 that
Rentrak would be pursuing an initial public offering ("IPO") or spinoff of its
subsidiary 3PF.COM, Inc. ("3PF"), without any apparent progress. Mr. Rosenbaum
felt that he had not received a satisfactory explanation for this lack of
results from either Rentrak or JHA. Also, Rentrak's fiscal 2000 third quarter
results announced in February showed that Rentrak's primary pay-per-transaction
("PPT") business was continuing to experience revenue declines: a 7.4% decrease
from the comparable three-month period ended December 31, 1998, and a 13.2%
decrease for the nine months ended December 31, 1999, compared to the same
periods in the prior year. These decreases came on the heels of a 6.0% decrease
in PPT revenues for Rentrak's fiscal year ended March 31, 1999, as compared to
the 1998 fiscal year.
Mr. Rosenbaum contacted several other Rentrak shareholders and members
of the brokerage community and asked them for their support for him to meet with
the board of
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directors of Rentrak to discuss his and their concerns regarding the direction
in which Rentrak was heading. He also engaged counsel to assist him in obtaining
a meeting with Rentrak's board.
In late April 2000, Rentrak's board agreed to appoint a special
committee consisting of a majority of the directors to meet with Mr. Rosenbaum
and discuss his concerns. The meeting took place on May 5, 2000, between Mr.
Rosenbaum and directors Baumgarten, Berger, LeVine and Roberts. At Mr.
Rosenbaum's request, Donald J. Kundinger of JHA also attended the meeting.
Although Mr. Rosenbaum had hoped to hear an explanation of why JHA had not yet
succeeded in completing an IPO or spinoff of 3PF, Mr. Kundinger was not
permitted to address these issues while Mr. Rosenbaum was present.
Mr. Rosenbaum discussed his concerns with the special committee about
declining PPT revenues and the lack of progress in completing an IPO or spinoff
of 3PF or any other transaction aimed at enhancing value for Rentrak's
shareholders. At the May 5 meeting and in follow-up conversations with
individual directors the next week, Mr. Rosenbaum indicated that, although he
believed he would be able to muster sufficient votes to oust the entire board of
directors at Rentrak's next shareholders meeting, he would not pursue a proxy
contest if the following actions were taken:
- An independent board of directors of 3PF was named and publicly
announced, which Mr. Rosenbaum believed would facilitate an IPO or
spinoff of 3PF.
- Two individuals designated by Mr. Rosenbaum were appointed to the
nine-member Rentrak board immediately and three additional
individuals designated by Mr. Rosenbaum were nominated for
election at Rentrak's annual shareholders meeting scheduled for
August.
- Mr. Berger was either terminated as chief executive officer of
Rentrak or given a leave of absence for 90 days to afford
Rentrak's board of directors an opportunity to review Rentrak's
strategic options independently.
- An outside review of Rentrak's financial records was undertaken
with the assistance of Rentrak's independent certified public
accountants. See "Election of New Directors (CARE Proposal 2)" for
a discussion of the reasons for this review.
In Mr. Rosenbaum's view, discussions at the May 5 meeting and with
individual directors the following week proved unproductive. Although individual
directors made various suggestions, including offers to elect Mr. Rosenbaum and
perhaps one additional person designated by Mr. Rosenbaum as Rentrak directors
and to seek the termination of Mr. Berger's employment, none of the discussions
appeared to Mr. Rosenbaum to be supported by a majority of the Rentrak directors
or to meaningfully address all of his concerns. Neither the special board
committee nor the Rentrak board as a whole ever provided a formal response to
Mr. Rosenbaum's concerns presented at the May 5 meeting. However, on May 15,
2000, perhaps in response to Mr. Rosenbaum's urgings, 3PF announced the
formation of a board of directors consisting of the president of 3PF, a Rentrak
director, and two outside directors, with an
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additional member to be determined. On July 25, 2000, 3PF announced that this
fifth position had been filled with a third outside director.
While pursuing discussions with members of Rentrak's board, Mr.
Rosenbaum also contacted 10 other individuals whom he believed held a total of
approximately 9 percent of Rentrak's outstanding common stock with a request
that they join him in signing demands to hold a special shareholders meeting in
compliance with Section 60.204(1)(b) of the Oregon Revised Statutes. By May 15,
2000, Mr. Rosenbaum had concluded that discussions with Rentrak's board were not
progressing. Accordingly, at Mr. Rosenbaum's direction, demands by Mr. Rosenbaum
and the 10 other Rentrak shareholders were delivered to the Secretary of Rentrak
requesting that a special meeting of the shareholders of Rentrak be called for
June 30, 2000, or as soon thereafter as practicable, for the purposes (1) of
removing from office the entire board of directors of Rentrak, consisting of
nine persons, (2) of amending Rentrak's Bylaws to delete provisions for a
classified board of directors and to fix the number of positions on the board at
five, and (3) of electing a new full board of directors, consisting of five
persons, to hold office until the next annual meeting of shareholders. The
demands were signed by:
- Cede & Co. as the record holder of 997,080 shares of Rentrak
common stock, or approximately 9.5 percent of the then outstanding
Rentrak shares, beneficially owned by Messrs. Annechino, Brown,
Cousins, Reck, Remlinger, Rosenbaum, and Wolcott and Drs.
Rosencrantz and Zehnder, as well as 175,250 Rentrak shares, or
approximately 1.7 percent of the then outstanding Rentrak shares,
held by Bruce Ament and Eugene Tinker; and
- One demand relating to 21,375 Rentrak shares, or approximately 0.2
percent of the then outstanding Rentrak shares, signed by Olde
Discount Corporation on behalf of Mr. Reck together with a demand
signed by Mr. Reck individually.
On May 16, 2000, perhaps in response to the meeting demands, Messrs.
LeVine and Roberts invited Mr. Rosenbaum to attend the May 19 meeting of
Rentrak's board of directors. Mr. Rosenbaum accepted on the condition that Mr.
Kundinger also attend and be permitted, in Mr. Rosenbaum's presence, to explain
JHA's inability to complete a spinoff or IPO of 3PF. On May 18, 2000, Mr.
Rosenbaum was advised by Rentrak's counsel that Mr. Kundinger would not be
permitted to attend the Rentrak board meeting. Mr. Rosenbaum then declined the
invitation of Messrs. LeVine and Roberts to attend the meeting, believing that
it would not be productive and would be no more than a rehash of the May 5
meeting with the special committee of Rentrak's board.
The following week, following discussions with Mr. Rosenbaum, Messrs.
Annechino, Brown, Reck, Remlinger, and Wolcott and Dr. Zehnder, together with
Mr. Rosenbaum, entered into an Agreement Among Rentrak Shareholders dated as of
May 24, 2000 (the "CARE Agreement"), to form CARE. Dr. Rosencrantz and Mr.
Cousins agreed to join CARE on June 13, 2000, and June 14, 2000, respectively.
Messrs. Ament and Tinker have declined to become parties to the CARE Agreement
or otherwise to participate in CARE's proxy solicitation. Pursuant to the CARE
Agreement, each member of CARE has agreed to be named in this proxy statement as
a member of CARE, to vote his shares of Rentrak common stock in favor of
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CARE's proposals as outlined above, to comply with the requirements of the state
and federal securities laws, and to cooperate with the other members of CARE to
achieve its objectives.
Also during the week of May 22, 2000, Mr. Berger invited Mr. Rosenbaum,
together with other CARE members and Mr. Kundinger if Mr. Rosenbaum so chose, to
attend a meeting on May 26, 2000, with Rentrak's management and independent
auditors to discuss certain accounting issues. Mr. Rosenbaum declined this
invitation because his primary motivation for commencing this proxy contest did
not relate to accounting issues and because CARE's counsel was informed by
Rentrak's counsel that the meeting offer was being extended on the condition
that the proxy contest would be dropped if the accounting issues were addressed
to Mr. Rosenbaum's satisfaction.
On June 14, 2000, Mr. Rosenbaum, through counsel, proposed to Rentrak's
counsel that the three items identified in the demands for a special meeting be
submitted for action at Rentrak's annual meeting of shareholders then scheduled
for August 21, 2000. If this proposal were accepted, Mr. Rosenbaum agreed that
he and other members of CARE beneficially owning at least 4 percent of the
outstanding Rentrak stock would cause Cede & Co. to withdraw its demands for a
special meeting of shareholders of Rentrak with respect to such shares. On June
15, 2000, Rentrak, through counsel, accepted this offer.
On July 7, 2000, Rentrak informed CARE through counsel that:
- On July 5, 2000, the board of directors of Rentrak amended
Rentrak's Bylaws to eliminate the classified board of directors.
- Each of the six incumbent directors whose term will not expire at
the Annual Meeting has agreed to resign as a director of Rentrak
immediately prior to the Annual Meeting (and the terms of the
remaining three incumbent directors will automatically expire),
eliminating the need to vote on CARE's proposal to remove all the
incumbent directors.
- The proposal to amend Rentrak's Bylaws to fix the number of board
positions at five and the election of directors will be the only
two proposals submitted for action at the Annual Meeting.
Meanwhile, beginning on June 16, 2000, the members of CARE, CARE's
nominees for director and certain other named defendants were served with a
complaint filed by Rentrak in the United States District Court for the District
of Oregon on June 13, 2000, alleging that the defendants had violated Section
13(d) of, and Rule 14a-9 promulgated under, the Securities Exchange Act of 1934
(the "Exchange Act"). Rentrak seeks as relief, among other things, the
preliminary and permanent enjoining of defendants, their agents and affiliates,
and all other persons acting in concert with them or on their behalf, directly
or indirectly, from:
- voting in person or by proxy any shares of Rentrak stock
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- soliciting any proxies or consents (including any requests to call
a special shareholders meeting) from owners of Rentrak stock
- purchasing or otherwise acquiring any additional Rentrak stock
- taking any steps to replace current Rentrak directors with
nominees of the defendants
- exercising or attempting to exercise influence or control over the
affairs of Rentrak
- initiating any other litigation concerning Rentrak in any other
court or forum
- selling or disposing of Rentrak shares except by orderly means
designed to ensure widespread public distribution
- encouraging other persons to do any of the foregoing or otherwise
acting in concert with others in the acquisition, holding, voting,
and disposition of Rentrak stock.
The complaint filed by Rentrak alleges, among other things, that JHA,
Rentrak's financial and investor relations advisor, and its principal, Donald J.
Kundinger, as well as Paul Bogdanich, whom the members of CARE understand to be
an independent consultant to JHA, were participants in and, in fact, the moving
force behind, the proxy contest being waged by CARE. The members of CARE are not
aware of any factual basis for this allegation. The members of CARE have
organized and pursued the proxy contest for Rentrak without the assistance or
urging of Messrs. Kundinger and Bogdanich. In fact, as far as the members of
CARE are aware, neither individual is even a shareholder of Rentrak.
When Rentrak appointed JHA as its financial and investor relations
advisor in mid-1999, Rentrak's shareholders were invited to contact JHA with
questions about Rentrak and its business. Thereafter, from time to time, some of
the individuals who later became CARE members called JHA from time to time with
questions about Rentrak, its financial condition and stock price. In addition,
in early November 1999, at Mr. Rosenbaum's request, Mr. Berger arranged for a
meeting among Mr. Kundinger, Mr. Bogdanich, Mr. Rosenbaum, another significant
Rentrak shareholder, and himself to discuss issues relating to Rentrak's
financial condition and the proposed IPO or spinoff of 3PF. Following that
meeting, Mr. Rosenbaum called Mr. Kundinger from time to time with questions
regarding the status of the issues discussed at the November meeting. Mr.
Rosenbaum also received information from Rentrak and JHA relating to Rentrak's
financial condition and business plans in connection with and as a follow-up to
the November meeting. Mr. Rosenbaum did not discuss with any Rentrak
shareholders other than the participants in the November meeting information
provided to him in connection with or as a result of the meeting.
However, as described above, Mr. Rosenbaum became increasingly
frustrated at the failure of JHA or Rentrak to explain the apparent lack of
progress in achieving an IPO or spinoff of 3PF, culminating in this proxy
contest. In April and May 2000, Mr. Rosenbaum called Mr. Kundinger to ascertain
his availability to attend the May 5 meeting and proposed May 19 and May 26
meetings with Rentrak management. Mr. Rosenbaum and counsel representing Mr.
Rosenbaum and the other members of CARE have also had communications with Mr.
Kundinger, Mr. Bogdanich and their respective counsel regarding the litigation
brought by Rentrak. The members of CARE are not aware of any other relationships
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relating to Rentrak, direct or indirect, between any member of CARE and JHA or
Messrs. Kundinger or Bogdanich.
The complaint also alleges that a statement of beneficial ownership on
Schedule 13D filed by the members of CARE and its nominees for director on May
31, 2000, was filed untimely and omits certain persons who are also required to
file on Schedule 13D. The members of CARE believe that the Schedule 13D was
filed within 10 days after the formation of a "group" under Section 13(d)(3)
having beneficial ownership of more than 5 percent of the outstanding Rentrak
stock, as required, and that all of the persons who are part of such group are
included in the Schedule 13D. The members of CARE and its nominees for director
are vigorously defending against Rentrak's allegations and the relief sought.
On July 7, 2000, CARE filed its answer to Rentrak's complaint and
several counterclaims against Rentrak, its directors individually, and two
Rentrak shareholders affiliated with two Rentrak directors. The counterclaims
allege that, as a result of certain actions taken by the directors and certain
officers of Rentrak, as described under "Reasons for the Solicitation" above,
such persons should have filed as a group a report of beneficial ownership of
Rentrak stock on Schedule 13D with the SEC by May 29, 2000, and certainly no
later than June 26, 2000. As a result of this alleged violation of Rule 13d-1(a)
under the Exchange Act by the directors and certain officers of Rentrak, CARE is
seeking as relief, among other things, the preliminary and permanent enjoining
of the counterclaim defendants from voting their shares of Rentrak stock,
purchasing or otherwise acquiring additional shares of Rentrak stock, or taking
any other actions which would require disclosure under Item 4 of Schedule 13D,
such as a merger or sale of assets involving Rentrak or any of its subsidiaries.
On August 1, 2000, CARE filed a motion in the litigation brought by
Rentrak seeking a preliminary injunction to prevent the counterclaim defendants,
including Messrs. Berger and Cox, from voting the shares acquired pursuant to
the loan program described under "Reasons for the Solicitation" above or from
selling or disposing of the shares pending further order of the court. In CARE's
memorandum of law in support of its motion, CARE asserts that Messrs. Berger and
Cox should be prohibited from voting their shares not only because of the
failure by Rentrak's management to file a Schedule 13D as alleged in CARE's
counterclaims described above, but also because Rentrak's directors violated
their fiduciary duties by permitting Messrs. Berger and Cox to acquire shares
from Rentrak for grossly inadequate consideration in order to entrench
management. Of course, CARE cannot predict whether it will succeed in obtaining
the injunctive relief it seeks. A hearing on the motion is scheduled for August
18, 2000.
AMENDMENT OF RENTRAK'S BYLAWS (CARE PROPOSAL 1)
Until July 5, 2000, Article 3, Section 3.2 of Rentrak's Bylaws provided
for a classified board of directors. CARE's members view a classified board as
motivated by a desire on the part of management to protect itself from being
displaced. CARE believes that it is inappropriate to raise these types of
barriers to shareholder democracy; rather, directors should be subject to the
possibility of replacement as an entire group each year in order to make them
feel more immediately and continuously accountable to shareholders' concerns.
Therefore, as described above under "Recent Events," among the proposals
submitted by members of CARE and two other Rentrak shareholders to Rentrak on
May 15, 2000, was a proposal to amend Rentrak's
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Bylaws to eliminate the classified board. Apparently in response to the May 15
demands, Rentrak amended its Bylaws on July 5, 2000, to delete the classified
board provisions. Although CARE's nominees for director, if elected, reserve the
right to consider and propose the removal of other anti-takeover measures, CARE
does not currently have any plan to remove or neutralize any other anti-takeover
device in place at Rentrak, including Rentrak's shareholder rights plan.
Section 3.2 of Rentrak's Bylaws now provides that the number of
directors may range from three to nine, with the precise number to be fixed by
the board of directors by resolution. CARE proposes to amend Section 3.2 of
Rentrak's Bylaws to provide for a board of directors with five members elected
annually. The text of the proposed amendment is as follows:
"Section 3.2 Number, Tenure and Qualifications. The
Board of Directors shall consist of five persons. Each
director shall hold office until the next annual meeting of
the shareholders and until his or her successor is elected
and qualified or until death, resignation or removal."
CARE has identified five individuals who it believes are qualified to
serve as directors of Rentrak, as described below. CARE believes the best way to
ensure that CARE's objectives are pursued is to elect a board of directors made
up entirely of CARE's nominees. CARE believes that the proposed reduction in the
size of the board of directors may have the advantage of enabling the full board
of directors to meet more frequently, providing more opportunity for interaction
with and oversight of management. CARE anticipates that fewer directors will
also result in a decrease in compensation expense attributable to the board of
directors (see "Director Compensation" below). On the other hand, a smaller
board would mean that fewer directors will constitute a quorum and, thus,
decisions may be made with the participation of fewer directors. Rentrak would
also be able to draw upon the expertise of fewer individuals, such that the
breadth and depth of knowledge, experience and diversity of perspectives
represented on the board could be significantly narrowed. However, CARE has
confidence in the qualifications and experience of its nominees and believes
that its five nominees will better serve Rentrak than Rentrak management's nine
nominees. CARE also notes that all of CARE's nominees are not employees of
Rentrak, while two of Rentrak's nine nominees are also officers of Rentrak or
one of its subsidiaries, lessening the effect of the reduction in board size on
the scope of expertise available to Rentrak.
Article 11 of Rentrak's Bylaws provides that the Bylaws may be amended
by the board of directors or by the shareholders at any regular or special
meeting. The proposed Bylaw amendment will have the effect of reducing the
number of board positions and fixing the number of directors at five, which
corresponds with CARE's proposal to elect five new directors. The amendment will
be adopted if the number of votes cast in favor of the proposal exceeds the
number of votes cast opposing the proposal at the Annual Meeting, provided that
a quorum is present. THE MEMBERS OF CARE URGE YOU TO VOTE FOR CARE PROPOSAL 1
AMENDING RENTRAK'S BYLAWS TO FIX THE NUMBER OF POSITIONS ON THE BOARD OF
DIRECTORS AT FIVE.
ELECTION OF NEW DIRECTORS (CARE PROPOSAL 2)
Under Rentrak's Bylaws, shareholders may nominate candidates for the
board of directors. Paul A. Rosenbaum, on behalf of CARE, submitted the names of
the five candidates
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<PAGE>
described below for election as directors to Rentrak on June 14, 2000, and
intends to place their names in nomination for election as directors at the
Annual Meeting if CARE Proposal 1 passes.
IF CARE PROPOSAL 1 (REDUCING THE BOARD OF DIRECTORS TO FIVE POSITIONS)
DOES NOT PASS, CARE'S NOMINEES FOR DIRECTOR WILL NOT BE PERMITTED TO BE
NOMINATED AT THE ANNUAL MEETING. THEREFORE, IF CARE PROPOSAL 1 DOES NOT PASS, A
SHAREHOLDER WHO VOTES ON CARE'S BLUE PROXY CARD WILL NOT BE ABLE TO CAST A VOTE
WITH RESPECT TO ANY OF RENTRAK'S NINE DIRECTOR POSITIONS AND, PRESUMABLY, ALL OF
RENTRAK'S NOMINEES FOR DIRECTOR WILL BE ELECTED.
CARE also notes that there is no assurance that any of Rentrak's
nominees will serve if elected with any of the CARE nominees. If fewer than all
five of CARE's nominees are elected as directors of Rentrak, each nominee has
indicated a continued willingness to serve as a director of Rentrak if (1) Mr.
Rosenbaum is one of the nominees elected or (2) CARE's nominees comprise a
majority of the Rentrak board. If CARE's nominees comprise less than a majority
of the Rentrak board (that is, one or two out of five positions), there is a
substantial likelihood that they will be unable to act on some or all of the
matters described below. Also, in the event of a board with membership split
between Rentrak's nominees and CARE's nominees, the board may deadlock on
certain issues or expend substantially more time and resources in reaching
decisions, which may have an adverse effect on Rentrak's competitive position
and its ability to react to market opportunities and conditions.
CARE anticipates that if the nominees named below are elected as
directors of Rentrak, they will consider fully and impartially all available
options that potentially may maximize shareholder value, including the possible
spinoff or public offering of equity securities of 3PF, the sale of one or more
subsidiaries of Rentrak, including 3PF, the sale of all or a portion of the
assets of Rentrak, or a business combination or merger or other business
transaction involving Rentrak or its subsidiaries. CARE believes these options
may maximize shareholder value because CARE is of the opinion that the current
market price of Rentrak's shares does not adequately reflect the value of
Rentrak's subsidiaries, especially 3PF. Each of the options mentioned represents
a method by which the value of one or more subsidiaries may be recognized
separate and apart from the value of the parent's stock, which may result in the
sum of the parts being greater than if considered as a whole. CARE has not yet
conducted an analysis to determine the market for 3PF, Rentrak's other
subsidiaries, Rentrak's assets, or a business combination involving Rentrak.
However, CARE anticipates that its nominees will exercise their best judgment in
the interests of Rentrak and its shareholders before pursuing any of the options
listed above or any other avenues for increasing Rentrak's value to its
shareholders that may become available. CARE notes that there is no assurance
that any of these avenues, if implemented, will succeed in enhancing shareholder
value.
The nominees, if elected, are also expected promptly to consider
removing Ron Berger as chairman and chief executive officer of Rentrak and
initiating a search for an appropriate replacement for Mr. Berger, which may
include members of present or former management of Rentrak. CARE's nominees
believe that such a replacement ideally would have substantial business
experience, preferably in the retail entertainment or Internet industries, a
proven track record of revitalizing companies, and a reputation for honesty and
integrity in business dealings.
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<PAGE>
Finally, following their election as Rentrak directors, the nominees
intend to consider retaining an outside consultant to conduct a review of
Rentrak's financial records in conjunction with Rentrak's independent certified
public accountants and to take any steps deemed appropriate based on the outcome
of such review. As noted under "Reasons for the Solicitation" above, Rentrak's
dealer financing program has generated significant write-offs. Also, Rentrak's
cash flow statement for the fiscal year ended March 31, 2000, lists a provision
for doubtful accounts of $6.3 million. Consequently, CARE believes a review of
Rentrak's financial records is necessary to assure that material business
transactions have been properly approved and documented, that Rentrak's assets
have been recorded in accordance with generally accepted accounting principles,
and that Rentrak's ability to collect its receivables is preserved.
Mr. Berger has an employment agreement with Rentrak which expires March
31, 2003, pursuant to which he may be entitled to receive severance pay if his
employment is terminated by Rentrak other than for "cause" or by Mr. Berger
following a "change of control" of Rentrak. Cause is defined as (1) an act or
acts of personal dishonesty taken by Mr. Berger and intended to result in the
substantial personal enrichment of Mr. Berger at the expense of Rentrak or (2)
the conviction of Mr. Berger of a felony. The election of CARE's nominees for
director would constitute a change of control of Rentrak under Mr. Berger's
employment agreement. Consequently, if CARE's nominees for director are elected
and thereafter Mr. Berger either quits or is fired, Mr. Berger may be entitled
to receive as severance pay an amount equal to approximately $1,300,000,
calculated based on the formula contained in his employment agreement.
The members of CARE intend to seek reimbursement from Rentrak for its
expenses incurred in the proxy contest if a majority of CARE's nominees are
elected to Rentrak's board of directors. See "The Solicitation" below. CARE'S
NOMINEES FOR DIRECTOR DO NOT INTEND TO SUBMIT THE ISSUE OF SUCH REIMBURSEMENT OF
CARE FOR ITS PROXY CONTEST EXPENSES TO A SEPARATE VOTE OF RENTRAK'S SHAREHOLDERS
UNLESS REQUIRED BY APPLICABLE LAW.
INFORMATION REGARDING NOMINEES FOR DIRECTOR
Set forth below are the names, ages, business addresses, beneficial
ownership of Rentrak shares, and percentage share ownership of each of CARE's
five nominees for election as a Rentrak director. Each nominee has consented to
serve as a director of Rentrak if elected, provided that Mr. Rosenbaum is one of
those elected or CARE's nominees comprise a majority of Rentrak's board, as
discussed above. If any of CARE's nominees is unable to serve or for good cause
will not serve as a Rentrak director (other than because the conditions
specified in the foregoing sentence are not met), the BLUE proxy cards solicited
by CARE will be voted for any substitute nominee designated by Paul A.
Rosenbaum. None of the nominees is presently a director of Rentrak or is related
to another nominee or to any of the present officers or directors of Rentrak.
Each is a citizen of the United States.
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<PAGE>
<TABLE>
No. of Shares
Beneficially
Owned Percentage
Name Age Business Address (1) of Class
---- --- ---------------- --- --------
<S> <C> <C> <C> <C> <C>
Cecil D. Andrus 68 350 N. Ninth Street 1,000 *
Boise, Idaho 83702
George H. Kuper 59 3600 Green Court 0 --
Ann Arbor, Michigan 48105
Joon S. Moon 62 11000 Mt. Rose Highway 1,000 *
Reno, Nevada 89511
James G. Petcoff 44 28819 Franklin Road 11,500 (2) *
Southfield, Michigan 48034
Paul A. Rosenbaum 57 127 E. Washtenaw 250,730 (3) 2.0%
Lansing, Michigan 48933
</TABLE>
* Beneficially owns less than 1 percent of Rentrak's outstanding common
stock.
(1) The nominee holds sole voting and dispositive power over his shares,
unless otherwise indicated.
(2) Mr. Petcoff owns his shares jointly with his wife, Janice Marie
Petcoff, who is a citizen of the United States and is not employed; her
address is 5853 Clearview Court, Troy, Michigan 48098.
(3) Mr. Rosenbaum has borrowed approximately $406,000 to purchase or hold
Rentrak common stock through a margin account with Prudential
Securities, Inc.
In 1995, Mr. Andrus founded and now serves as the chairman of the
Andrus Center for Public Policy at Boise State University. Since 1995, Mr.
Andrus has also been of counsel to the Gallatin Group, a public policy
consulting firm in Boise, Idaho. He was elected governor of the state of Idaho
for four terms (beginning in 1970, 1974, 1986, and 1990). Mr. Andrus also was
the U.S. Secretary of the Interior from 1977 to 1981. Mr. Andrus serves as
director of Albertsons, Inc., KeyCorp, and Coeur d'Alene Mines.
Mr. Kuper is an independent consultant in the areas of public policy,
environmental and energy issues and provides advice to small and start-up
companies in the chemical, electronics, and software industries. Mr. Kuper has
also served as president, chief executive officer, and a director of the Council
of Great Lakes Industries ("CGLI") located in Ann Arbor, Michigan, since 1994.
CGLI is affiliated with the World Business Council for Sustainable Development
located in Geneva, Switzerland and is a not-for-profit association consisting of
more than two dozen U.S. and Canadian companies. Since 1994, Mr. Kuper has also
served as the chairman of the Office of the Secretary of Defense Working Group
on Dual-Use Technology Policy. Prior to 1994, Mr. Kuper's activities included
serving for three years as the executive director of the National Center for
Productivity and Quality of Working Life, a Presidential appointment, working
for General Electric Company for five years to enhance its productivity
programs, and
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<PAGE>
serving as executive director of the Manufacturing Studies Board of the National
Academy of Sciences, National Research Council, for five years. Mr. Kuper
received a B.A. in political science from The Johns Hopkins University and an
M.B.A. from the Harvard School of Business Administration.
Mr. Moon has served as the chairman of Rooto Corporation, a
manufacturer of industrial and household chemicals, for the past five years. Mr.
Moon's background is as a research chemist with E.I. duPont de Nemours Co. and
Celanese Corporation. Mr. Moon received a B.S. in chemical engineering from
Michigan State University and a Ph.D. in chemical engineering from the
University of California at Berkeley. Mr. Moon serves as a member of the board
of directors of Thomas Jefferson University, and has previously served as a
director of Michigan State University Foundation, Michigan Bank, Independence
One Mutual Fund, Michigan General Corporation, Maxco Energy, and Progressive
Dynamics Corporation.
Mr. Petcoff has served as president and chief executive officer of
North Pointe Financial Services, Inc., a provider of insurance and other
financial services, since 1986. Since 1999, Mr. Petcoff has also served as
president and chief executive officer of Queensway Financial Holdings Limited, a
Canadian holding company affiliated with North Pointe Financial Services, Inc.
He received an M.B.A. and a J.D. from the University of Detroit. Mr. Petcoff is
a director of Lease Corporation of America.
Mr. Rosenbaum founded SWR Corporation in 1994 and serves as the
company's chief executive officer. SWR Corporation designs, tests, and markets
industrial chemicals. Mr. Rosenbaum has also been engaged in the private
practice of law through his own firm specializing in corporate and
administrative law since 1978. He received a B.S. in American studies from
Springfield College and a J.D. from The George Washington University Law School.
Mr. Rosenbaum has borrowed a total of $125,000 from Mr. Petcoff for reasons
unrelated to Rentrak or its securities.
There are no arrangements or understandings between any CARE nominee
and any other person pursuant to which that nominee was selected as a nominee
for director of Rentrak or with respect to any future employment by Rentrak or
any future transactions to which Rentrak or any of its affiliates may be a
party. However, if CARE's nominees are elected as directors of Rentrak, they are
not precluded from determining that Rentrak should engage in one or more
transactions with CARE's nominees or members or any of their affiliates,
including family members or other companies under their control, although no
such transactions are presently contemplated.
DIRECTOR COMPENSATION
Rentrak's preliminary proxy materials for the Annual Meeting state that
non-employee directors receive an annual retainer of $25,000 and $500 for each
board meeting or telephone conference board meeting attended and an automatic
annual stock option grant for 10,000 shares of Rentrak common stock plus an
additional option grant for 2,500 shares to each non-employee chairman of a
Board committee. The CARE nominees for director, if elected, intend to reduce
the annual retainer to $20,000 and to retain the other compensation features for
Rentrak non-employee directors. CARE also expects that each of its nominees, if
elected, will be indemnified
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<PAGE>
for his services to Rentrak to the same extent that indemnification is presently
available to Rentrak's directors.
REASONS FOR ELECTING CARE'S DIRECTOR NOMINEES
As described above, the members of CARE believe that Rentrak's
financial results over the past several years indicate that Rentrak's management
is ineffective and that its directors have not been providing adequate guidance
and direction.
In CARE's view, Rentrak's problems justify the step of electing a
completely new set of outside directors, even if these candidates do not have
the support of current management. CARE's members believe that its nominees
offer the experience and judgment that Rentrak shareholders need to enhance the
value of their investment in Rentrak. However, there is no assurance that
shareholder value will be increased if CARE's nominees are elected. CARE notes
that, if elected, its nominees may continue to have access to the expertise of
Rentrak's officers as necessary. In CARE's view, management's nominees as a
whole do not offer superior expertise and independent business judgment because
they are comprised almost entirely of representatives of consultants and
suppliers to Rentrak (e.g., Messrs. Batra, Jimirro, LeVine, and Roberts) or
representatives of Rentrak affiliates (e.g., Messrs. Balner, Kusaka, Masuda, and
Berger). See "Reasons for the Solicitation" above. If CARE Proposal 1 to amend
Rentrak's Bylaws passes, the five nominees who receive the greatest number of
votes (a plurality) will be elected as directors of Rentrak. Cumulative voting
for directors is not permitted under Rentrak's organizational documents.
CARE URGES YOU TO VOTE FOR ITS FIVE NOMINEES TO SERVE ON RENTRAK'S
BOARD OF DIRECTORS.
VOTING PROCEDURES
Rentrak's proxy statement and proxy card include the proposal to amend
Rentrak's Bylaws described above and a proposal for the election of directors,
but do not include the names of CARE's nominees for director. The Bylaws will be
amended to provide for a five-person board of directors only if CARE Proposal 1
passes. If (but only if) CARE Proposal 1 passes, CARE will place the names of
its nominees in nomination for election as directors at the Annual Meeting. If
CARE Proposal 1 does not pass, you will not be able to vote for any of the nine
positions on the board of directors using CARE's BLUE proxy card and,
presumably, all of Rentrak's nominees for director will be elected. You also
will not be able to vote for CARE's nominees for director using the form of
proxy sent to you by Rentrak. We therefore urge you to sign and return CARE's
BLUE proxy card using the enclosed return envelope.
Even if you have already returned a proxy to Rentrak using Rentrak's
proxy card, you can still cast your vote for our proposals, including any or all
of CARE's nominees, by indicating your choices on the enclosed BLUE proxy card
and signing, dating, and returning it in the enclosed envelope. See the
discussion in "Revocation Rights" below.
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<PAGE>
The presence, in person or by proxy, of the holders of Rentrak common
stock entitled to cast a majority of the votes entitled to be cast at the Annual
Meeting is required to constitute a quorum for the transaction of business at
the Annual Meeting. Under applicable Oregon law, abstentions and broker
non-votes (that is, shares held in street name as to which the broker, bank or
other nominee has no discretionary power to vote on a particular matter, has
received no instructions from the persons entitled to vote such shares and has
appropriately advised Rentrak that it lacks voting authority) are counted for
purposes of determining the presence or absence of a quorum for the transaction
of business.
A plurality of the votes present, in person or by proxy, is required
for the election of directors. If CARE Proposal 1 to amend Rentrak's Bylaws
passes, there will be five positions on the board of directors; otherwise there
will be nine positions. With respect to the election of directors, votes may be
cast in favor or withheld with respect to any or all nominees officially
nominated; votes that are withheld and broker non-votes will be excluded
entirely from the vote and will have no effect on the outcome. Abstention is not
a choice in the election of directors. If CARE Proposal 1 passes, it is possible
that some of Rentrak's nominees and some of CARE's nominees will receive
sufficient votes to be elected as directors. As required by Rule 14a-4(d)(iv) of
the SEC's proxy rules under the Exchange Act, CARE hereby states that there is
no assurance that Rentrak's nominees will serve if elected with any of CARE's
nominees. Each of CARE's nominees has agreed to serve even if elected with one
or more of Rentrak's nominees, provided that Mr. Rosenbaum is one of those
elected or the CARE nominees comprise a majority of the board of directors. See
"Election of New Directors (CARE Proposal 2)" above.
A shareholder may, with respect to each other matter presented for
action at the Annual Meeting, vote "for," vote "against," or "abstain" from
voting. Shares represented by proxies that are marked "abstain" on such matters
and proxies relating to broker non-votes will not affect the outcome of the vote
on such matters. Unless otherwise directed on the enclosed BLUE proxy card, as
more fully described below, Paul A. Rosenbaum or Mark A. Brown, on behalf of
CARE, will vote FOR CARE Proposal 1 and FOR each of CARE's five nominees to
serve as directors of Rentrak.
If you sign and return the accompanying BLUE proxy card, it will be
voted at the Annual Meeting in accordance with your instructions on the card.
With respect to CARE Proposal 2, you may vote FOR the election of all of CARE's
nominees, or you may withhold authority to vote for the election of one or more
of such nominees by writing the person's name on the line provided on the BLUE
proxy card. The BLUE proxy card cannot be used to vote for the election of any
of the director candidates nominated by Rentrak and cannot be used to vote for
more than five positions.
We do not know of any other matters that will be brought before the
Annual Meeting. However, if any other matter properly comes before the Annual
Meeting, it is intended that the persons named in and acting under the enclosed
form of BLUE proxy card, or their substitutes, will vote on such matters in
accordance with their judgment.
According to Rentrak's Annual Report on Form 10-K for the fiscal year
ended March 31, 2000, there were 12,289,883 shares of Rentrak common stock
outstanding as of June 20, 2000.
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<PAGE>
Based on such number and the fact that the members of CARE together beneficially
own approximately 1,100,000 shares of Rentrak stock, holders of an additional
5,045,000 shares would have to vote in favor of CARE's proposals in order to
constitute an absolute majority of the shares outstanding, ensuring the adoption
of CARE Proposal 1 and the election of all five of CARE's nominees for director.
REVOCATION RIGHTS
A shareholder may revoke his or her proxy any time before the tally by
(1) executing a later-dated proxy card, (2) appearing at the Annual Meeting to
vote in person or (3) delivering written notice of revocation to CARE at Beacon
Hill Partners, Inc., 90 Broad Street, New York, New York 10004, or to the
Secretary of Rentrak. At the Annual Meeting, CARE's BLUE proxy cards must be
presented to Rentrak's tabulator in order to be counted.
PARTICIPANTS IN THE SOLICITATION
AND BENEFICIAL OWNERSHIP OF RENTRAK STOCK
The members of CARE, along with CARE's nominees for director, are all
considered participants in this proxy solicitation under the SEC's proxy rules.
The SEC requires that certain information be made available to Rentrak
shareholders with respect to any person who may be deemed a participant in this
solicitation. The members of CARE are Michael J. Annechino, Mark A. Brown,
Thomas S. Cousins, Jr., Gordon A. Reck, Donald W. Remlinger, Paul A. Rosenbaum,
David R. Rosencrantz, M.D., Guy R. Wolcott, and Frederick L. Zehnder, each of
whom is a citizen of the United States.
Michael J. Annechino has his own financial consulting business, PCSG,
Inc., located at 13305 N.E. 2nd Court, Vancouver, Washington 98685. He has sole
voting and dispositive power as to 2,000 shares of Rentrak common stock and
shares voting and dispositive power over 95,400 shares with his wife, Theresa
Ann Annechino, who is a citizen of the United States and is employed by PCSG,
Inc.
Mark A. Brown is vice president/finance of VWR Scientific Products, a
wholesale distributor of scientific equipment, supplies, chemicals and
furniture, located at 2730 N.E. Riverside Way, Portland, Oregon 97211. He has
sole voting and dispositive power as to 44,550 shares of Rentrak common stock,
including 7,800 shares owned by his minor children, Chris and Lauren Brown, and
his nephew, Adam Kraushaar, and shares voting and dispositive power as to 75,000
shares with his wife, Sherri K. Brown, who is a citizen of the United States and
is not employed; her address is 18672 S.E. Hwy 212, Clackamas, Oregon 97015. Mr.
Brown has borrowed approximately $138,000 to purchase or hold Rentrak common
stock through a margin account with First Union Brokerage Services, Inc.
Thomas S. Cousins, Jr., is an investment executive with U.S. Bancorp
Piper Jaffray, 1327 Spruce Street, Boulder, Colorado 80302. Mr. Cousins
currently is on leave of absence from his employment; his residence address is
540 Columbine Avenue, Broomfield, Colorado. He has sole voting and dispositive
power as to 65,000 shares of Rentrak common stock.
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<PAGE>
Gordon A. Reck is an associate broker at Jim Saros Agency, a realtor
located at 17108 Mack, Grosse Pointe, Michigan 48230. He shares voting and
dispositive power as to 67,000 shares of Rentrak common stock with his wife,
Susan E. Reck, who is a citizen of the United States and a teacher employed by
the Detroit Board of Education; her address is 765 Middlesex, Grosse Pointe
Park, Michigan 48230. Mr. Reck has borrowed a total of approximately $75,800 to
purchase or hold Rentrak common stock through margin accounts with A.G. Edwards,
Inc., First Union Brokerage Services, Inc., and Olde Discount Corporation.
Donald W. Remlinger is president of Bristol Management Corp., a
financial consulting company, located at 9 Brigade Hill Road, Morristown, New
Jersey 07960. He has sole voting and dispositive power as to 75,000 shares of
Rentrak common stock.
David R. Rosencrantz is a urologist practicing at 2222 N.W. Lovejoy,
Ste. 416, Portland, Oregon 97210. He has sole voting and dispositive power as to
6,000 shares of Rentrak common stock and shares voting and dispositive power as
to 57,700 shares with his wife, Diane S. Rosencrantz, who is a citizen of the
United States and is office manager at Dr. Rosencrantz's office.
Guy R. Wolcott is president of his own plumbing contracting business,
Wolcott Plumbing, located at 2050 N.W. Burnside, Gresham, Oregon 97030. Mr.
Wolcott has sole voting and dispositive power as to 10,000 shares of Rentrak
common stock held by the Wolcott Plumbing Profit Sharing Trust, shares voting
and dispositive power as to 198,300 shares with his wife, Chris Wolcott, who is
a citizen of the United States and is not employed (her address is 3633 Oxbow
Parkway, Gresham, Oregon 97080), and shares voting and dispositive power as to
88,000 shares held by the WF Foundation, a family foundation, with his wife and
son, Guy Wolcott, Jr., who is a citizen of the United States and is employed as
a plumbing estimator with Wolcott Plumbing.
Frederick L. Zehnder is an optometrist practicing at 504 N. Franklin,
Frankenmuth, Michigan 48734. Dr. Zehnder has sole voting and dispositive power
as to 77,600 shares of Rentrak common stock and shares voting and dispositive
power as to 3,000 shares with his wife, Wendy Ann Zehnder, who is a citizen of
the United States and is self-employed as an interior decorator; her address is
7576 S. Block Road, Frankenmuth, Michigan 48734.
The business address, principal occupation and principal business, and
share ownership of CARE's nominees for director appears under "Election of New
Directors (CARE Proposal 2)."
As of the close of business on August 4, 2000, the members of CARE and
its director nominees (c/o Paul A. Rosenbaum, 127 E. Washtenaw, Lansing,
Michigan 48933) beneficially owned in the aggregate 1,128,780 shares of
Rentrak's common stock, constituting approximately [9.2] percent of the total
outstanding shares. All transactions in securities of Rentrak engaged in by any
member of CARE or any of its nominees for director since August 1, 1998, are
summarized on Schedule I attached to this proxy statement.
The members of CARE and CARE's nominees for director have contributed
the following amounts to defray the expenses of the proxy contest, including
attorneys' fees in
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<PAGE>
connection with legal proceedings by or against Rentrak and its directors and
officers: Mr. Andrus, $2,500; Mr. Annechino, $5,000; Mr. Brown, $15,000; Mr.
Cousins, $10,000; Mr. Kuper, $2,500; Mr. Moon, $2,500; Mr. Petcoff, $0; Mr.
Reck, $5,000; Mr. Remlinger, $10,000; Mr. Rosenbaum, $5,000; Dr. Rosencrantz,
$5,000; Mr. Wolcott, $10,000; and Dr. Zehnder, $10,000.
Other than the CARE Agreement, none of the participants in this proxy
solicitation is otherwise a party to any contract, arrangement or understanding
with any person with respect to any securities of Rentrak, except that Paul A.
Rosenbaum has acquired sole voting and dispositive power with respect to a total
of 89,300 shares of Rentrak common stock from four individuals, pursuant to an
understanding with each individual that, upon the demand of the individual, Mr.
Rosenbaum will either pay in cash the market value of the shares on the date of
demand, plus in some cases interest at an annual rate of 10 percent, or transfer
the shares back to the individual. Mr. Rosenbaum borrowed such shares in each
instance from close friends who are not associated with CARE or its other
members in order to avoid the sale of shares of Rentrak common stock held in his
margin account upon a drop in the market price of Rentrak stock sufficient to
threaten a margin call. Due to these personal friendships, the persons lending
shares to Mr. Rosenbaum did not ask for or receive any other consideration other
than the potential payment of interest if the transaction was ultimately settled
by the payment of cash instead of the return of the shares by Mr. Rosenbaum.
No participant in this solicitation or any associate of any participant
(1) has any arrangement or understanding with any person with respect to future
employment by Rentrak or its subsidiaries, (2) has any arrangement or
understanding with any person as to any future transactions to which Rentrak or
any of its affiliates will or may be a party, or (3) had during Rentrak's last
fiscal year any direct or indirect material interest with respect to any, or has
any such interest with respect to any currently proposed, transaction to which
Rentrak or any of its subsidiaries was or is to be a party. There is nothing to
preclude Rentrak from entering into any such employment or transaction with any
such person in the future.
Over the past several years, Mr. Rosenbaum has had occasional
discussions with Ron Berger, chairman and chief executive officer of Rentrak,
over issues of concern to Mr. Rosenbaum as a Rentrak shareholder regarding
Rentrak's business prospects and goals. In one such conversation in the fall of
1999, Mr. Berger expressed concern over the impact of the loss of Cyberian
Outpost as a customer of 3PF, a wholly owned subsidiary of Rentrak. A subsidiary
of Cyberian Outpost, Outpost.com, is an Internet retailer. Robert A. Bowman, the
president and chief executive officer of Cyberian Outpost, is a long-time
personal acquaintance of Mr. Rosenbaum. Mr. Rosenbaum offered to contact Mr.
Bowman to see if he would consider reestablishing a customer relationship with
3PF. Shortly thereafter, Mr. Berger offered to transfer at no cost to Mr.
Rosenbaum shares in 3PF equal to 1 percent of its total capitalization if, by
January 31, 2000, Mr. Rosenbaum succeeded in causing Cyberian Outpost to use 3PF
to handle at least 70 percent of its fulfillment requirements. In January 2000,
Rentrak proposed an arrangement calling for the payment to Mr. Rosenbaum of
$250,000 in cash plus $7,500 per month for consulting services with respect to
governmental issues for a three-year period if Cyberian Outpost and 3PF entered
into a written agreement for 3PF to handle substantially all of Cyberian
Outpost's fulfillment requirements for a minimum of one year by March 1, 2000.
Mr.
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<PAGE>
Rosenbaum arranged for a meeting between him, Mr. Bowman, and Bill Polich, the
president of 3PF, to discuss the possibility of such a renewed relationship,
which was held in January 2000. Mr. Rosenbaum also had an additional meeting and
several follow-up telephone conversations with Mr. Bowman. However, Mr.
Rosenbaum was unable to arrange for consummation of the transactions proposed by
Rentrak relating to Cyberian Outpost within the time limitations imposed by
Rentrak due to market conditions and other factors. No other transaction or
understanding between Rentrak and Mr. Rosenbaum relating to any other matter has
been entered into and no negotiations between Rentrak and Mr. Rosenbaum with
respect to any such transaction are ongoing.
THE SOLICITATION
The entire cost of the solicitation of proxies by CARE will be borne by
the members of CARE. The members of CARE intend, however, to seek reimbursement
from Rentrak for these expenses if a majority of CARE's nominees are elected to
Rentrak's board of directors, including the legal expenses of the members of
CARE and its nominees for director in the legal proceedings instituted by
Rentrak discussed above. CARE'S NOMINEES FOR DIRECTOR DO NOT INTEND TO SUBMIT
THE ISSUE OF SUCH REIMBURSEMENT OF CARE FOR ITS EXPENSES INCURRED IN THE PROXY
CONTEST TO A SEPARATE VOTE OF RENTRAK'S SHAREHOLDERS UNLESS REQUIRED BY
APPLICABLE LAW. To date, CARE has incurred cash expenditures of $ , and
-------
CARE estimates that total expenditures relating to its solicitation will not
exceed $ .
----------
Proxies may be solicited by mail, courier service, telephone,
advertisement, electronic communication and in person. Arrangements will be made
with brokerage houses or other custodians, nominees, and fiduciaries to forward
CARE's solicitation materials to their clients; CARE will reimburse such persons
for their reasonable expenses. CARE's nominees and members may, without
additional compensation, make solicitations through personal contact or by
telephone.
In addition, CARE has engaged the proxy solicitation firm of Beacon
Hill Partners, Inc., to assist it in its soliciting efforts for a fee of up to
$30,000, including a success fee, plus reimbursement of expenses. It is
anticipated that Beacon Hill Partners will make available approximately 20
persons in connection with its efforts on behalf of CARE. In addition to the
solicitation of proxies from retail investors, brokers, banks, nominees and
other institutional holders, such persons will, among other activities, provide
consultation pertaining to the planning and organization of the proxy
solicitation. CARE has also agreed to indemnify Beacon Hill Partners against
certain liabilities and expenses relating to the proxy solicitation.
ADDITIONAL INFORMATION
This proxy statement includes information based on documents filed by
Rentrak with the SEC, including Rentrak's revised preliminary proxy materials
filed July 31, 2000.
Information regarding Rentrak's director nominees, management, 5
percent shareholders and executive compensation will be contained in Rentrak's
definitive proxy statement. Rentrak's definitive proxy statement will also
include the dates by which shareholder proposals intended to
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<PAGE>
be submitted at its next annual meeting must be received by Rentrak to be
included in its proxy statement or otherwise.
PLEASE ACT PROMPTLY.
SIGN, DATE, AND MAIL THE BLUE PROXY CARD TODAY!
August , 2000
---
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<PAGE>
TRANSACTIONS IN RENTRAK STOCK
SINCE AUGUST 1998
Trade Date Type of Transaction Number of Shares
---------- ------------------- ----------------
Cecil D. Andrus 11/9/99 Purchase 1,000
Mark A. Brown 3/10/99 Purchase 2,000
3/23/99 Sale 2,000
4/27/99 Purchase 5,000
5/7/99 Purchase 5,000
5/20/99 Purchase 2,500
5/27/99 Purchase 600
6/8/99 Purchase 9,400
6/9/99 Purchase 9,000
6/10/99 Purchase 10,000
6/25/99 Purchase 10,500
6/30/99 Purchase 2,500
7/2/99 Purchase 3,500
7/7/99 Purchase 5,000
7/23/99 Purchase 9,250
9/8/99 Purchase 5,500
9/15/99 Purchase 5,000
9/24/99 Purchase 2,000
10/5/99 Purchase 20,000
10/25/99 Purchase 232
10/26/99 Purchase 600
11/18/99 Sale 832
12/8/99 Sale 2,000
12/30/99 Purchase 9,000
Thomas S. Cousins, Jr. 9/1/99 Purchase 5,000
9/9/99 Purchase 5,000
9/13/99 Purchase 5,000
10/8/99 Purchase 20,000
10/21/99 Purchase 4,000
10/29/99 Purchase 5,500
11/1/99 Purchase 5,500
11/2/99 Purchase 4,000
11/12/99 Purchase 3,000
12/6/99 Purchase 3,000
2/9/00 Purchase 5,000
1
<PAGE>
Gordon A. Reck 3/23/99 Purchase 2,000
3/24/99 Purchase 2,000
1/20/00 Purchase 10,000
4/14/00 Sale 2,000
Donald W. Remlinger 11/19/99 Purchase 5,000
Paul A. Rosenbaum 8/10/98 Purchase 2,000
8/12/98 Purchase 1,000
8/13/98 Purchase 1,000
8/14/98 Purchase 1,000
8/27/98 Purchase 500
8/28/98 Purchase 500
9/3/98 Purchase 100
9/15/98 Purchase 100
9/21/98 Purchase 1,000
10/2/98 Purchase 5,000
10/14/98 Purchase 250
11/23/98 Purchase 1,000
3/2/99 Purchase 650
3/9/99 Purchase 500
3/12/99 Purchase 500
3/16/99 Purchase 500
3/17/99 Purchase 250
3/18/99 Purchase 250
3/19/99 Purchase 250
4/5/99 Purchase 250
4/7/99 Purchase 100
4/14/99 Purchase 100
4/16/99 Purchase 100
4/19/99 Purchase 100
4/20/99 Purchase 100
4/21/99 Purchase 100
4/27/99 Purchase 100
4/30/99 Purchase 1,000
5/25/99 Purchase 800
5/28/99 Purchase 5,000
6/22/99 Purchase 4,000
7/2/99 Purchase 320
7/9/99 Purchase 1,500
7/13/99 Purchase 500
7/14/99 Purchase 500
7/15/99 Purchase 100
7/16/99 Purchase 1,100
7/19/99 Purchase 1,300
8/16/99 * 30,300
2
<PAGE>
8/18/99 Purchase 1,000
8/20/99 Purchase 100
8/24/99 Purchase 1,000
8/25/99 Purchase 1,000
8/26/99 Purchase 1,080
8/27/99 Purchase 1,000
9/21/99 Purchase 3,500
9/22/99 Purchase 1,500
9/28/99 Purchase 3,000
9/29/99 Purchase 1,500
10/07/99 * 9,000
10/15/99 Purchase 200
10/20/99 Purchase 550
10/25/99 Purchase 250
11/17/99 Purchase 1,100
11/19/99 Purchase 1,000
11/22/99 Purchase 200
11/23/99 Purchase 300
1/11/00 Purchase 300
1/21/00 Purchase 900
1/24/00 Purchase 2,100
1/25/00 Purchase 1,000
1/27/00 Purchase 1,000
3/13/00 Sale 600
4/06/00 * 30,000
5/8/00 Purchase 5,000
5/11/00 * 20,000
5/17/00 Purchase 200
David R. Rosencrantz 10/5/98 Sale 1,500
10/27/98 Sale 100
12/15/98 Sale 1,000
12/16/98 Sale 400
12/29/98 Sale 1,500
12/30/98 Sale 6,000
1/4/99 Sale 2,000
1/4/99 Sale 1,000
2/24/99 Sale 500
5/28/99 Purchase 10,000
2/22/00 Purchase 3,500
4/11/00 Purchase 10,000
4/28/00 Purchase 5,000
Guy R. Wolcott 8/3/98 Purchase 2,000
8/4/98 Purchase 12,000
8/5/98 Purchase 15,000
3
<PAGE>
3/29/99 Purchase 5,000
7/26/99 Sale 1,500
7/27/99 Sale 12,000
7/30/99 Sale 51,000
8/06/99 Sale 10,600
8/10/99 Sale 5,000
8/11/99 Sale 2,700
8/17/99 Sale 27,500
8/18/99 Sale 30,000
8/19/99 Sale 8,000
8/23/99 Sale 3,700
9/15/99 Purchase 10,000
9/22/99 Purchase 5,000
9/27/99 Purchase 10,000
9/29/99 Purchase 10,000
10/04/99 Purchase 300
10/05/99 Purchase 10,000
10/06/99 Purchase 15,800
11/10/99 Purchase 1,400
11/30/99 Purchase 5,300
6/22/00 Purchase 1,400
6/26/00 Purchase 5,000
6/28/00 Purchase 7,700
6/29/00 Purchase 100
6/30/00 Purchase 100
7/19/00 Purchase 9,300
Frederick L. Zehnder 12/24/98 Purchase 3,800
12/28/98 Purchase 6,200
--------------
* Mr. Rosenbaum acquired sole voting and dispositive power as to the
indicated shares pursuant to an understanding with each of the prior
holders (David Watson as to 30,300 shares, Bud Stoddard as to 9,000
shares, Paul Naz as to 30,000 shares, and Arlyn and Eunice Bossenbrook as
to 20,000 shares) that, upon the demand of the prior holder, he will
either pay to the prior holder the market value of the shares as of the
date of such demand in cash, plus in some cases interest at an annual
rate of 10 percent, or transfer the shares back to the prior holder.
4
<PAGE>
PROXY SOLICITED BY COMMITTEE FOR THE ACHIEVEMENT
OF RENTRAK EXCELLENCE
RENTRAK CORPORATION
2000 ANNUAL MEETING OF SHAREHOLDERS
This Proxy is solicited on behalf of the Committee for the Achievement
of Rentrak Excellence for use at the 2000 Annual Meeting of Shareholders to be
held on September 19, 2000 (the "Annual Meeting"). The undersigned hereby
appoints Paul A. Rosenbaum and Mark A. Brown, and each of them, proxies with
full power of substitution, to vote in the name of and as proxy for the
undersigned at the Annual Meeting, and at any adjournment thereof, according to
the number of votes that the undersigned would be entitled to cast if personally
present on the following matters:
(1) To amend Rentrak Corporation's 1995 Restated Bylaws to fix the number
of directors at five.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(2) If Proposal (1) passes, to elect the following nominees as directors of
Rentrak Corporation: Paul A. Rosenbaum; Cecil D. Andrus; George H. Kuper; Joon
S. Moon; and James G. Petcoff.
[ ] FOR ALL NOMINEES LISTED ABOVE (except as indicated to the
contrary below)
------------------------------------------------------
[ ] WITHHOLD AUTHORITY to vote for all nominees listed above.
INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
"For" and write the individual's name for whom authority is withheld on the line
above.
(3) To consider and take action upon such other matters as may properly come
before the meeting or adjournments or postponements thereof.
PROPERLY EXECUTED PROXIES WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE
UNDERSIGNED. IF NO SUCH DIRECTIONS ARE GIVEN, SUCH PROXIES WILL BE VOTED FOR
---
PROPOSAL (1) AND FOR ALL NOMINEES LISTED IN PROPOSAL (2) AND ON SUCH OTHER
---
MATTERS AS MAY COME BEFORE THE ANNUAL MEETING AS THE PROXIES DEEM ADVISABLE.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
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<PAGE>
The undersigned revokes any prior proxies to vote the shares covered by this
Proxy.
-----------------------------------
Signature
-----------------------------------
Signature
Date: , 2000
-------------------------
NOTE: Please sign exactly as name appears above. When shares are held by joint
owners, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in corporate name by President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
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