PANDORA MEDIA, INC.
EMPLOYEE INDUCEMENT GRANT

NOTICE OF RESTRICTED STOCK UNIT GRANT

[Participant Name]

You have been granted a number of restricted stock units (the “RSUs”), each
representing one share of Common Stock of Pandora Media, Inc. (the “Company”)
(the “Shares”), as follows:
Date of Grant:     [Grant Date]
Total Number of RSUs Granted:    [Number of Shares Granted]
Grant Number: [Client Grant ID]
Vesting/Exercise Schedule:
Except as set forth in this Notice, so long as your Continuous Service Status
continues, the RSUs shall vest in accordance with the following schedule:

[Vesting Date/Quantity]

Termination of Relationship:
In the event of the termination of your Continuous Service Status for any
reason, all unvested RSUs subject to this Notice shall be forfeited.

The RSUs are being granted to you as an “employment inducement award” under NYSE
Rule 303A.08, outside of the Pandora Media, Inc. 2011 Equity Incentive Plan (the
“Plan”). Notwithstanding that the RSUs are being granted outside of the Plan,
except as expressly provided otherwise, the RSUs will be governed in a manner
consistent with the terms and conditions of the Plan.
By accepting these RSUs, you agree that these RSUs are governed by the terms and
conditions of the Restricted Stock Unit Agreement attached hereto and
incorporated by reference herein and that the RSUs will be governed in a manner
consistent with the terms and conditions of the Plan.
In addition, you agree and acknowledge that your rights to any Shares underlying
the RSUs will be earned only as you provide services to the Company or its
affiliates over time and that nothing in this Notice or the attached documents
confers upon you any right to continue your employment or consulting
relationship with the Company or any of

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its affiliates for any period of time, nor does it interfere in any way with
your right or the right of the Company or its affiliates to terminate that
relationship at any time, for any reason, with or without cause.

 
PANDORA MEDIA, INC.
 
 
 
 
[Signed Electronically] 
By:  /s/ Roger Lynch   
[Participant Name] 

Name: Roger Lynch   
 
Title: CEO   

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PANDORA MEDIA, INC.

RESTRICTED STOCK UNIT AGREEMENT

1.    Grant of Restricted Stock Unit. Pandora Media, Inc., a Delaware
corporation (the “Company”), hereby grants to you (“Participant”) the number of
RSUs (each representing a share of Common Stock of the Company) set forth in the
Notice of Restricted Stock Unit Grant (the “Notice”). The RSUs have been granted
as an “employment inducement award” under NYSE Rule 303A.08, outside of the
Pandora Media, Inc. 2011 Equity Incentive Plan (the “Plan”). Notwithstanding
that the RSUs are being granted outside of the Plan, except as expressly
provided otherwise, the RSUs will be governed in a manner consistent with the
terms and conditions of the Plan, which is incorporated in this Agreement by
reference. Unless otherwise defined in this Agreement, the terms used in this
Agreement shall have the meanings defined in the Notice or the Plan, as
applicable. The terms and conditions of this Restricted Stock Unit Award
Agreement (this “Agreement”), to the extent not controlled by the terms and
conditions contained in the Plan, are as follows:
1.Vesting. The RSUs shall become vested on the vesting schedule set forth in the
Notice, subject to Participant remaining in Continuous Service Status on the
applicable vesting date.
2.    Forfeiture of Unvested RSUs. Immediately upon termination of Participant’s
employment for any reason (including death or disability), any unvested RSUs
shall be forfeited without consideration.
3.    Conversion into Common Stock. Shares will be issued on the applicable
vesting date (or, to the extent not administratively feasible, as soon as
practicable thereafter). As a condition to such issuance, Participant shall have
satisfied his or her tax withholding obligations as specified in this Agreement
and shall have completed, signed and returned any documents and taken any
additional action that the Company deems appropriate to enable it to accomplish
the delivery of the Shares. In no event will the Company be obligated to issue a
fractional share. Notwithstanding the foregoing, (i) the Company shall not be
obligated to deliver any Shares during any period when the Company determines
that the conversion of a RSU or the delivery of shares hereunder would violate
any federal, state or other applicable laws and/or may issue shares subject to
any restrictive legends that, as determined by the Company’s counsel, is
necessary to comply with securities or other regulatory requirements, and (ii)
the date on which shares are issued may include a delay in order to provide the
Company such time as it determines appropriate to address tax withholding and
other administrative matters.

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4.    Tax Treatment. Any withholding tax liabilities (whether as a result of
federal, state or other law and whether for the payment and satisfaction of any
income tax, social security tax, payroll tax, or payment on account of other tax
related to withholding obligations that arise by reason of the RSUs) incurred in
connection with the RSUs becoming vested and Shares issued, or otherwise
incurred in connection with the RSUs, may be satisfied in any of the following
manners determined by the Committee (and the Committee may with notice to
Participant require any of the following methods): (i) by the sale by
Participant of a number of Shares that are issued under the RSUs, which the
Company determines is sufficient to generate an amount that meets the tax
withholding obligations plus additional Shares to account for rounding and
market fluctuations, and payment of such tax withholding to the Company, and
such Shares may be sold as part of a block trade with other participants of the
Plan; (ii) with the consent of the Committee in its discretion, by the Company
withholding a number of Shares that would otherwise be issued under the RSUs
that the Company determines have a fair market value equal to the minimum amount
of taxes that the Company concludes it is required to withhold under applicable
law; or (iii) by payment by Participant to the Company in cash or by check an
amount equal to the minimum amount of taxes that the Company concludes it is
required to withhold under applicable law. Participant hereby authorizes the
Company to withhold such tax withholding amount from any amounts owing to
Participant to the Company and to take any action necessary in accordance with
this paragraph.
Notwithstanding the foregoing, Participant acknowledges and agrees that he or
she is responsible for all taxes that arise in connection with the RSUs becoming
vested and Shares being issued or otherwise incurred in connection with the
RSUs, regardless of any action the Company takes pursuant to this Section.
5.    Restrictions on Transfer. Participant understands and agrees that the RSUs
may not be sold, given, transferred, assigned, pledged or otherwise hypothecated
by the holder.
6.    Certificates. Certificates, transfer agent book entries or other evidence
of ownership as determined by the Company issued in respect of the Shares shall,
unless the Committee otherwise determines, be registered in the name of
Participant. The stock certificate, if any, shall carry such appropriate
legends, and such written instructions shall be given to the Company transfer
agent, as may be deemed necessary or advisable by counsel to the Company in
order to comply with the requirements of the Securities Act of 1933, any state
securities laws or any other applicable laws.
7.    No Stockholder Rights. Participant will have no voting or other rights as
the Company’s other stockholders with respect to the Shares until issuance of
the Shares.
8.    No Employment/Service Rights. Neither this Agreement nor the grant of the
RSUs hereby confers on Participant any right to continue in the employ or
service of the Company or any Subsidiary or interferes in any way with the right
of the Company or any Subsidiary to determine the terms of Participant’s
employment or service.

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9.    Entire Agreement; Terms of Plan, Interpretations. Participant acknowledges
that he or she has received and reviewed a copy of the Plan. This Agreement
(including the Notice) contains the entire understanding of the parties hereto
in respect of the subject matter contained herein. This Agreement together with
the Plan supersedes all prior agreements and understandings between the parties
hereto with respect to the subject matter hereof. This Agreement and the terms
and conditions herein set forth are subject in all respects to the terms and
conditions of the Plan, which shall be controlling. All interpretations or
determinations of the Committee and/or the Board shall be binding and conclusive
upon Participant and his or her legal representatives on any question arising
hereunder.
10.    Section 409A. This Agreement is intended to be exempt from or comply with
Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”),
and shall be interpreted and construed accordingly. Notwithstanding any other
provision in this Agreement (including the Notice), to the extent any payments
hereunder constitute nonqualified deferred compensation, within the meaning of
Section 409A, then (a) to the extent this Agreement provides for the RSUs to
become vested and be settled upon Participant’s termination of Participant’s
Continuous Service Status, the RSUs shall be settled upon Participant’s
“separation from service” (within the meaning of Section 409A) and (b) if
Participant is a specified employee (within the meaning of Section 409A) as of
the date of Participant’s separation from service, each such payment that is
payable upon Participant’s separation from service and would have been paid
prior to the six-month anniversary of Participant’s separation from service,
shall be delayed until the earlier to occur of (i) the six-month anniversary of
Participant’s separation from service and (ii) the date of Participant’s death.

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