Exhibit 10.3

CHANGE IN CONTROL SEVERANCE AND RETENTION AGREEMENT

This CHANGE IN CONTROL SEVERANCE AND RETENTION AGREEMENT (as modified, extended
or supplemented from time to time, this “Agreement”) is entered into as of
June 5, 2006 (the “Effective Date”) by and between Encore Capital Group, Inc., a
Delaware corporation (the “Company”), and ______________ (“Executive”).

1. Definitions. As used in this Agreement and unless otherwise defined herein,
capitalized terms will have the respective meanings set forth in Appendix A.

2. Term of Agreement. This Agreement shall be effective on the date hereof and
shall continue in effect until the first anniversary of the Effective Date if no
Change in Control has occurred by that time, or until the end of the twelve
month period following a Change in Control, if a Change in Control has occurred
prior to the first anniversary of the Effective Date.

3. Payments Upon Termination of Employment.

(a) If during the Termination Period the employment of Executive shall terminate
pursuant to a Qualifying Termination, then the Company shall provide to
Executive:

(1) Within ten (10) days following the Date of Termination a lump-sum cash
amount equal to the Executive’s base salary through the Date of Termination and
any bonus amounts which have become payable, to the extent not previously paid
or deferred; plus

(2) Subject to Section 3(c) below, a cash severance amount equal to one times
Executive’s highest annual rate of base salary during the 12-month period
immediately prior to Executive’s Date of Termination, paid in equal installments
over the one-year period commencing with the first regular payroll date
following the Date of Termination in accordance with the Company’s normal
payroll practices; provided that, if necessary to avoid tax penalties under
Section 409A of the Internal Revenue Code of 1986, as amended, the commencement
of such payments shall be delayed until the first regular payroll date which
occurs more than six months following the Date of Termination, with the first of
such payments including all payments which would have been made during the
period of such delay without regard thereto, without interest.

(b) If during the Termination Period the employment of Executive shall terminate
other than by reason of a Qualifying Termination, then the Company shall pay to
Executive within thirty (30) days following the Date of Termination, a lump-sum
cash amount equal to Executive’s base salary through the Date of Termination and
any bonus amounts which have become payable, to the extent not previously paid
or deferred.

(c) Executive acknowledges and agrees that any and all payments to which
Executive may become entitled under Section 3(a)(2) above are conditioned upon
and

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subject to Executive’s execution of, and not having revoked within any
applicable revocation period, a general release and waiver, in such reasonable
and customary form as shall be prepared by the Company, of all claims Executive
may have against the Company and its directors, officers, subsidiaries and
affiliates, except as to (i) matters covered by provisions of this Agreement
that expressly survive the termination of this Agreement, (ii) rights to
indemnification and insurance under the Charter, By-Laws and directors and
officers insurance policies maintained by the Company or any Subsidiary and
(iii) rights to which Executive is entitled by virtue of his participation in
the employee benefit plans, policies and arrangements of the Company or any
Subsidiary.

4. Retention Bonus. If Executive remains employed through the consummation of a
Change in Control, he shall receive a lump sum payment of the Retention Bonus
within ten (10) days following the consummation of the Change in Control.

5. Withholding Taxes. The Company may withhold from all payments due to
Executive (or his beneficiary or estate) hereunder all taxes which, by
applicable federal, state, local or other law, the Company is required to
withhold therefrom.

6. Scope of Agreement. Nothing in this Agreement shall be deemed to entitle
Executive to continued employment with the Company or any Subsidiary, and if
Executive’s employment shall terminate prior to a Change in Control, Executive
shall have no further rights under this Agreement other than as stated in
Section 4; provided, however, that any termination of Executive’s employment
during the Termination Period shall be subject to all of the provisions of this
Agreement.

7. Successors; Binding Agreement.

(a) This Agreement shall not be terminated by any reorganization, merger or
consolidation involving the Company (each, a “Business Combination”). In the
event of any Business Combination, the provisions of this Agreement shall be
binding upon the person resulting from such Business Combination (the “Surviving
Person”), and the Surviving Person shall be treated as the Company hereunder.

(b) This Agreement shall inure to the benefit of and be enforceable by
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If Executive shall die
while any amounts would be payable to Executive hereunder had Executive
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to such person or persons
appointed in writing by Executive to receive such amounts or, if no person is so
appointed, to Executive’s estate.

8. Notice. For purposes of this Agreement all notices and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given (1) on the date of delivery if delivered personally or by
facsimile upon confirmation of receipt, (2) on the first business day following
the date of dispatch if delivered by a recognized next-day courier service or
(3) five days after deposit in the United States mail,

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certified and return receipt requested, postage prepaid. All such notices and
communications shall be delivered as set forth below.

If to Executive, to the home address of Executive

last appearing in the Company’s records.

If to the Company:

Encore Capital Group, Inc.

8875 Aero Drive

Suite 200

San Diego, California 92123

Attn: General Counsel

with a copy addressed to the attention of the General Counsel of the Company at
the above address,

or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.

9. Full Settlement. In the event of a Qualifying Termination, the Company’s
obligation to make any payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall be in lieu and in full settlement of all
other severance payments to Executive under any other severance or employment
agreement between Executive and the Company. The Company’s obligations hereunder
shall not be affected by any set-off, counterclaim, recoupment defense or other
claim, right or action which the Company may have against Executive or others.
In no event shall Executive be obligated to seek other employment or take other
action by way of mitigation of the amounts payable to Executive under any of the
provisions of this Agreement and such amounts shall not be reduced whether or
not Executive obtains other employment.

10. Employment with Subsidiaries. Employment with the Company for purposes of
this Agreement shall include employment with any Subsidiary.

11. Restrictive Covenants.

(a) Cessation of Rights to Certain Future, Contingent Payments Upon Entering
Competitive Employment. If Executive, during the one (1) year period commencing
on and following the Date of Termination (whether prior to or following a Change
in Control), directly or indirectly, without the prior written consent of the
Board, becomes employed by, or acts as a consultant to or in association with,
or as a director, officer, employee, partner, owner, joint venturer, member or
otherwise, of any person, firm, corporation, partnership, limited liability
company, association or other entity that engages in any business in which the
Company or any Subsidiary was engaged, or in which any of them had taken
demonstrable steps to become engaged, at the Date of Termination, in the same
geographical area in which any of them engage, or are planning on becoming
engaged, in such business (other than by beneficial ownership of up to 2% of the
outstanding voting stock of a publicly-traded company that is or owns such a
competitor), Executive’s right to receive severance payments then being made by
the Company pursuant to Section 3(a)(2) shall immediately cease and the
Company’s obligation to make such

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payments under Section 3(a)(2) shall immediately terminate as of the date
Executive enters into such employment or other relationships as described in
this Section 11(a).

(b) Non-Solicitation. Executive agrees that for one (1) year commencing on and
following the Date of Termination (whether prior to or following a Change in
Control), Executive will not directly or indirectly (i) solicit or hire or
encourage the solicitation or hiring of any person who was an employee of the
Company or any Subsidiary at any time on or after the Date of Termination
(unless more than six (6) months shall have elapsed between the last day of such
person’s employment by the Company and any Subsidiary and the first date of such
solicitation or hiring) or (ii) induce or attempt to induce any employee of the
Company or any Subsidiary to leave the employ thereof or in any way interfere
with the relationship between the Company or any Subsidiary and any employee
thereof.

(c) Non-Disclosure of Confidential Information. Executive recognizes that the
services Executive performs for the Company and its affiliates are special,
unique and extraordinary in that Executive may acquire confidential information,
trade secrets or other competitive information concerning the operations of the
Company and its affiliates, the use or disclosure of which could cause the
Company and its affiliates substantial loss and damages which could not be
readily calculated, and for which no remedy at law would be adequate.
Accordingly, Executive agrees that Executive will not at any time during
Executive’s employment with the Company or any Subsidiary or thereafter, except
in performance of Executive’s obligations thereto, disclose, either directly or
indirectly, any Confidential Information (as hereinafter defined) that Executive
may learn by reason of his association with the Company and its affiliates. The
term “Confidential Information” shall mean any past, present or future
confidential or secret plans, programs, documents, agreements, internal
management reports, financial information or other material relating to the
business, strategies, services or activities of the Company and its affiliates,
including, without limitation, information with respect to the Company’s and its
affiliates’ operations, processes, products, inventions, business practices,
finances, principals, vendors, suppliers, customers, potential customers,
marketing methods, costs, prices, contractual relationships (including leases),
regulatory status, compensation paid to employees or other terms of employment,
and trade secrets, market reports, customer investigations, customer lists and
other similar information that is proprietary information of the Company or any
of its affiliates. Notwithstanding the foregoing, Executive may disclose such
Confidential Information when required to do so by a court of competent
jurisdiction, by any governmental agency having supervisory authority over the
business of the Company and/or its affiliates, as the case may be, or by any
administrative body or legislative body (including a committee thereof) with
jurisdiction to order Executive to divulge, disclose or make accessible such
information; provided, further, that in the event that Executive is ordered by
any such court or other government agency, administrative body or legislative
body to disclose any Confidential Information, Executive shall (i) promptly
notify the Company of such order, (ii) at the written request of the Company,
diligently contest such order at the sole expense of the Company as expenses
occur and (iii) at the written request of the Company, seek to obtain, at the
sole expense of the Company, such confidential treatment as may be available
under applicable laws for any information disclosed under such order.

(d) Non-disparagement. The Executive agrees (whether during or after the
Executive’s employment with the Company) not to issue, circulate, publish or
utter any

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false or disparaging statements, remarks or rumors about the Company or the
officers or directors of the Company other than to the extent reasonably
necessary in order to (i) assert a bona fide claim against the Company arising
out of the Executive’s employment with the Company, or (ii) respond in a
truthful and appropriate manner to any legal process or give truthful and
appropriate testimony in a legal or regulatory proceeding.

(e) Mutual Dependence of Covenants and Condition Subsequent. Executive covenants
and agrees to be bound by the restrictive covenants and agreements contained in
this Section 11 to the maximum extent permitted by Delaware law, it being the
intent and spirit of the parties that the restrictive covenants and agreements
contained in this Agreement shall be valid and enforceable in all respects, and,
subject to the terms and conditions of this Agreement, Executive’s compliance
with the covenants contained in Section 11(a) is mutually dependent upon and a
condition subsequent to the Company’s obligation to make the payments described
in Section 3(a)(2) of this Agreement and such payments shall immediately cease
upon any breach of Section 11(a). Likewise, if Executive commences any action in
court or in arbitration challenging the validity of, seeking to invalidate or
otherwise seeking some sort of declaration that the covenants and agreements in
Section 11(a) are void, voidable or invalid, the Company’s obligations to make
the payments described in Section 3(a)(2) of this Agreement shall immediately
cease as of the time of the commencement of such action or proceeding. If the
Company does not discover Executive’s breach of Section 11(a) or the
commencement of any such action or arbitration proceedings until after one or
more payments under Section 3(a)(2) have been made to Executive, Executive shall
be obligated to immediately return all such payments to the Company that were
paid and received after the breach of Section 11(a).

(f) Remedies Upon Breach. If the Executive breaches the provisions of Sections
11(b), (c) or (d), the Company shall have the right to have such restrictive
covenants specifically enforced by any court of competent jurisdiction, it being
agreed that any breach of such restrictive covenants would cause irreparable
injury to the Company and that money damages would not provide an adequate
remedy for such injury. Accordingly, the Company shall be entitled to injunctive
relief to enforce the terms of such restrictive covenants and to restrain the
Executive from any violation thereof. The rights and remedies set forth in this
Section 11(f) shall be independent of all other others rights and remedies
available to the Company for a breach of such restrictive covenants, and shall
be severally enforceable from, in addition to, and not in lieu of, any other
rights and remedies available at law or in equity.

12. Survival. The respective obligations and benefits afforded to the Company
and Executive as provided in Sections 3 (to the extent that payments or benefits
are owed as a result of a termination of employment that occurs during the term
of this Agreement), 5, 7(b), 9 and 11 shall survive the termination of this
Agreement.

13. Dispute Resolution. The Company and Executive agree that any controversy or
claim arising out of or relating to this Agreement (other than a controversy
under Section 11 of this Agreement), or the breach thereof, shall be settled by
arbitration administered by the American Arbitration Association in accordance
with its Employment Arbitration Rules then in effect. Venue for any arbitration
pursuant to this Agreement will lie in San Diego, California. One of the
arbitrators shall be appointed by the Company, one shall be appointed by
Executive and the third shall be appointed by the first two arbitrators. If the
first two arbitrators

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cannot agree on the third arbitrator within 30 days following the appointment of
the second arbitrator, then the third arbitrator shall be appointed by the
Association. All three arbitrators shall be experienced in the resolution of
disputes under employment agreements for senior executives of major
corporations. Any award entered by the arbitrators shall be final, binding and
nonappealable and judgment may be entered thereon by either party in accordance
with applicable law in any court of competent jurisdiction. This arbitration
provision shall be specifically enforceable. The arbitrators shall have no
authority to modify any provision of this Agreement or to award a remedy for a
dispute involving this Agreement other than a benefit specifically provided
under or by virtue of the Agreement. Each party shall be responsible for its own
expenses relating to the conduct of the arbitration (including reasonable
attorneys’ fees and expenses). The Company shall pay the fees of the American
Arbitration Association and the arbitrators, if applicable.

14. GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT WILL BE GOVERNED BY,
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE APPLICABLE
TO AGREEMENTS MADE AND TO BE WHOLLY PERFORMED WITHIN THAT STATE, WITHOUT REGARD
TO THE CONFLICT OF LAWS PROVISIONS OF ANY JURISDICTION WHICH WOULD CAUSE THE
APPLICATION OF ANY LAW OTHER THAN THAT OF THE STATE OF DELAWARE. ANY ACTION TO
ENFORCE THIS AGREEMENT (OTHER THAN AN ACTION WHICH MUST BE BROUGHT BY
ARBITRATION PURSUANT TO SECTION 13) MUST BE BROUGHT IN, AND THE PARTIES HEREBY
CONSENT TO THE JURISDICTION OF, A COURT SITUATED IN NEW YORK, NEW YORK. EACH
PARTY HEREBY WAIVES THE RIGHTS TO CLAIM THAT ANY SUCH COURT IS AN INCONVENIENT
FORUM FOR THE RESOLUTION OF ANY SUCH ACTION.

15. JURY TRIAL WAIVER. THE PARTIES EXPRESSLY AND KNOWINGLY WAIVE ANY RIGHT TO A
JURY TRIAL IN THE EVENT ANY ACTION ARISING UNDER OR IN CONNECTION WITH THIS
AGREEMENT IS LITIGATED OR HEARD IN ANY COURT.

16. Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed to be an original and all of which together shall constitute
one, and the same instrument.

17. Miscellaneous. No provision of this Agreement may be modified or waived
unless such modification or waiver is agreed to in writing and signed by
Executive and by a duly authorized officer of the Company. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. Failure by Executive
or the Company to insist upon strict compliance with any provision of this
Agreement or to assert any right Executive or the Company may have hereunder
shall not be deemed to be a waiver of such provision or right or any other
provision or right of this Agreement. Except as otherwise specifically provided
herein, the rights of, and benefits payable to, Executive, his estate or his
beneficiaries pursuant to this Agreement are in addition to any rights of, or
benefits payable to,

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Executive, his estate or his beneficiaries under any other employee benefit plan
or compensation program of the Company.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by a
duly authorized officer of the Company and Executive has executed this Agreement
as of the day and year first above written.

 

ENCORE CAPITAL GROUP, INC. By:   /s/ Brandon Black   Name:   Brandon Black  
Title:   Chief Executive Officer    [NAME OF EXECUTIVE]

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Appendix A

(Certain Defined Terms)

As used in the Agreement the following terms shall have the respective meanings
set forth below:

1. “Board” means the Board of Directors of the Company.

2. “Cause” means (a) any failure to adhere to any written policy of the Company
that is legal and generally applicable to employees of the Company; (b) failure
by the Executive to substantially perform his duties, which failure amounts to a
repeated and consistent neglect of his duties; (c) the appropriation (or
attempted appropriation) of a material business opportunity of the Company or
any subsidiary thereof, including attempting to secure or securing any personal
profit in connection with any transaction entered into on behalf of the Company
or any subsidiary thereof; (d) the misappropriation (or attempted
misappropriation) of any of the Company’s funds or property; (e) the conviction
of, or the entering of a guilty plea or plea of no contest, with respect to a
felony, the equivalent thereof, a crime of moral turpitude or any other crime
with respect to which imprisonment is a possible punishment; (f) conduct
materially injurious to the Company’s reputation or business; or (g) willful
misconduct.

3. “Change in Control” means the occurrence of any one of the following events:

(a) the Company is merged into or consolidated with another corporation, in a
transaction in which, upon completion, the Company’s stockholders beneficially
own (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”)), less than 50% of the total voting securities
entitled to vote generally in the election of directors of the surviving or
resulting company outstanding;

(b) all or substantially all of the assets of the Company are acquired by
another corporation or business entity;

(c) any person (as such term is used in Section 13(d) and 14(d)(2) of the
Exchange Act), other than an employee benefit plan of the Company or any
subsidiary of the Company or any entity holding shares of capital stock of the
Company for or pursuant to the terms of any such employee benefit plan in its
role as an agent or trustee for such plan, shall acquire 50% or more of the
Company’s outstanding voting stock entitled to vote generally in the election of
directors; or

(d) a majority of the directors of the Company being individuals not nominated
by the Board.

Notwithstanding the foregoing, the events described above shall not be deemed to
be a Change in Control if they occur as a result of (i) a transaction involving

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any person (as defined in clause 3(c)) which is the beneficial owner (as defined
in clause 3(a)) as of the date of this Agreement, of more than 5% of the
Company’s outstanding voting stock entitled to vote generally in the election of
directors or any associate or affiliate of such person (as such terms are
defined in Rule 405 promulgated under the Securities Act of 1933, as amended) or
(ii) in the case of clause 3(c), a person acquiring such 50% ownership position
as a result of the acquisition by the Company of its voting stock which reduces
the number of outstanding shares of voting stock of the Company.

4. “Compensation Committee” means the Compensation Committee of the Board.

5. “Date of Termination” means (a) the effective date on which Executive’s
employment by the Company or any Subsidiary terminates as specified in a prior
written notice by the Company, such Subsidiary or Executive, as the case may be,
to the other, delivered pursuant to Section 8 or (b) if Executive’s employment
by the Company or any Subsidiary terminates by reason of death, the date of
death of Executive.

6. “Disability” means termination of Executive’s employment by the Company or
any Subsidiary due to Executive’s absence from Executive’s duties on a full-time
basis for at least one hundred eighty (180) consecutive days as a result of
Executive’s incapacity due to physical or mental illness.

7. “Good Reason” means, without Executive’s express written consent, the
occurrence of any of the following events after a Change in Control:

(a) a significant and material reduction in the Executive’s duties,
responsibilities and authority;

(b) any reduction in base salary; or

(c) any relocation by the Company of the Executive’s employment to a location
outside of Southern California without the Executive’s consent.

8. “Qualifying Termination” means a termination of Executive’s employment (a) by
the Company or any Subsidiary other than for Cause or (b) by Executive for Good
Reason. Termination of Executive’s employment on account of death or Disability
shall not be treated as a Qualifying Termination.

9. “Retention Bonus” means ___% of Executive’s highest annual rate of base
salary during the period commencing one year prior to a Change in Control and
ending on date of payment of the Retention Bonus pursuant to Section 4 of the
Agreement.

10. “Subsidiary” means any corporation or other entity in which the Company has
a direct or indirect ownership interest of 50% or more of the total combined
voting power of the then outstanding securities or interests of such corporation
or other entity entitled to vote generally in the election of directors or in
which the

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Company has the right to receive 50% or more of the distribution of profits or
50% of the assets on liquidation or dissolution.

11. “Termination Period” means the period of time beginning with a Change in
Control and ending twelve months following such Change in Control.