Exhibit 10.1

SEPARATION AGREEMENT AND RELEASE

This Separation Agreement and Release (“Agreement”) is made by and between
Robert Kimball (“Executive”) and RealNetworks, Inc. (the “Company”)
(collectively referred to as the “Parties” or individually referred to as a
“Party”).

RECITALS

WHEREAS, Executive was employed by the Company;

WHEREAS, the Company and Executive have entered into a Change in Control and
Severance Agreement dated as of February 24, 2010 (the “Severance Agreement”);

WHEREAS, the Company and Executive have entered into a Retention Letter
Agreement dated as of February 24, 2010 (the “Retention Agreement”);

WHEREAS, the Company and Executive have entered into an employee confidentiality
agreement (the “Confidentiality Agreement”);

WHEREAS, the Company has granted Executive stock options, restricted stock and
restricted stock units, from time to time (each an “Equity Award” and
collectively the “Equity Awards”), which are reflected on Appendix A, each
pursuant to a specific stock award agreement (collectively, the “Stock
Agreements”);

WHEREAS, Executive’s employment with the Company will terminate on or about
April 15, 2011 (the “Separation Date”);

WHEREAS, the Parties wish to resolve any and all disputes, claims, complaints,
grievances, charges, actions, petitions, and demands that the Executive may have
against the Company and any of the Releasees as defined below, including, but
not limited to, any and all claims arising out of or in any way related to
Executive’s employment with or separation from the Company;

NOW, THEREFORE, in consideration of the mutual promises made herein, the Company
and Executive hereby agree as follows:

COVENANTS

1. Consideration. Executive agrees that the consideration provided below in
Section 1(b) constitute good and adequate consideration for the promises,
covenants, restrictions and other terms and conditions provided by this
Agreement.

a. Accrued Payments. The Company agrees to pay Executive (i) Executive’s accrued
but unpaid salary and (ii) Executive’s accrued but unused vacation, in each case
which has accrued through the Separation Date. The Company also agrees to pay
Executive for any unreimbursed business expenses required to be reimbursed to
Executive pursuant to the Company’s normal and customary business expense
reimbursement procedures.

 

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b. Severance Consideration. The consideration set forth in this Section 1(b) is
referred to collectively as the “Severance Consideration.”

(i) Severance Payment. The Company agrees to pay Executive, in a single lump sum
cash payment, an amount equal to one million five hundred and seventy-five
thousand dollars ($1,575,000), less applicable withholding, on the Company’s
first payroll date occurring after the Effective Date (as defined below in
Section 25) of this Agreement, which reflects eighteen (18) months of salary and
target annual incentive bonus.

(ii) Pro-Rata Incentive Bonus. The Company agrees to pay Executive, in a single
lump sum cash payment, an amount equal to one hundred and fifty-three thousand
and one hundred and twenty-five dollars ($153,125), less applicable withholding,
on the Company’s first payroll date occurring after the Effective Date, which
reflects the pro-rata portion of Executive’s annual incentive bonus for the year
of the Separation Date.

(iii) Cash Retention Award. The Company agrees to pay Executive, in a single
lump cash payment, an amount equal to two hundred and eight-three thousand
dollars ($283,000), less applicable withholding, on the Company’s first payroll
date occurring after the Effective Date, which reflects the unvested portion of
the retention payment set forth in the Retention Agreement.

(iv) Equity Awards. The Company agrees that, to the extent not already fully
vested, the vesting of each Equity Award listed on Appendix A shall be fully
accelerated as of the Separation Date. The Company intends that Appendix A
includes all of the outstanding stock options and restricted stock units granted
to Executive. Each of Executive’s stock option awards listed on Appendix A shall
be amended, to the extent necessary, so as to provide Executive with a period
equal to the lesser of (A) eighteen (18) months after the end of the consulting
period described below in Section 1(b)(vi), or (B) the remaining term of the
stock option to exercise such stock options. For example, if such stock options
had been granted with a ten (10) year maximum term, then Executive would have
until the end of such maximum term or eighteen (18) months from the end of the
consulting period, whichever is less, to exercise such stock options. The Equity
Awards shall in all other respects remain subject to all of the other terms and
conditions of the applicable Stock Agreements (as amended and/or modified by the
terms of the Severance Agreement or Retention Agreement).

(v) Benefits. The Company agrees to reimburse Executive for premiums incurred to
continue group health benefits for Executive, his spouse and any children,
provided the Executive makes the appropriate health continuation election
pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985
(“COBRA”), until the first to occur of (A) eighteen (18) months following the
Separation Date, or (B) the date Executive obtains comparable coverage. The
Company will make the reimbursements described in the preceding sentence on a
monthly basis. Notwithstanding anything to the contrary in this Section 1(b)(v),
if the Company determines in its sole discretion that it cannot provide the
COBRA benefits without potentially violating applicable law (including, without
limitation, Section 2716 of the Public Health Service Act), the Company will in
lieu thereof provide to Executive a taxable monthly payment in an amount equal
to the monthly COBRA premium that Executive would be required to pay to continue
his group health coverage in effect on the date of his termination of employment
(which amount will be based on the premium for the first month of COBRA
coverage), which payments will be made regardless of whether Executive elects
COBRA continuation coverage and will end on the earlier of (x) the date upon
which Executive becomes covered under similar plans or (y) the last day of the
eighteenth (18th) calendar month following the month in which Executive
terminations employment.

 

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(vi) Consulting Services. Executive shall serve as a consultant, as reasonably
requested by the Company to assist with an orderly transition of duties and
responsibilities, for a period of three (3) months following the Separation
Date. Executive will be compensated at a monthly rate equal to forty-three
thousand and six hundred and sixty-six dollars ($43,666) per month. The Company
will also reimburse Executive for any related business expenses in accordance
with standard Company policies. Executive will make himself reasonably available
to provide the consulting services, but notwithstanding anything to the contrary
in this Agreement, Executive shall not be required to perform any services under
the Consulting Agreement that would result in Executive providing services at a
level greater than twenty percent (20%) of the average level of services
Executive performed for the Company during the thirty-six (36) month period
immediately preceding the Separation Date.

c. Executive specifically acknowledges that Executive is not entitled to receive
any additional severance, termination payments, wages, bonus or other form of
compensation from the Company.

2. Benefits. Executive’s health insurance benefits will cease on the last day of
April 2011, subject to Executive’s right to continue his health insurance under
COBRA. Executive’s participation in all benefits and incidents of employment,
including, but not limited to, the accrual of bonuses, vacation, and paid time
off, ceased as of the Separation Date.

3. Payment of Salary and Receipt of All Benefits. Executive acknowledges and
represents that, other than the consideration set forth in this Agreement, the
Company has paid or provided all salary, wages, bonuses, accrued vacation/paid
time off, premiums, leaves, housing allowances, relocation costs, interest,
severance, outplacement costs, fees, reimbursable expenses, commissions, stock,
stock options, vesting, and any and all other benefits and compensation due to
Executive.

4. Release of Claims. Executive agrees that the foregoing consideration
represents settlement in full of all outstanding obligations owed to Executive
by the Company and its current and former officers, directors, employees,
agents, investors, attorneys, shareholders, administrators, affiliates, benefit
plans, plan administrators, insurers, trustees, divisions, and subsidiaries, and
predecessor and successor corporations and assigns (collectively, the
“Releasees”). Executive, on his own behalf and on behalf of his respective
heirs, family members, executors, agents, and assigns, hereby and forever
releases the Releasees from, and agrees not to sue concerning, or in any manner
to institute, prosecute, or pursue, any claim, complaint, charge, duty,
obligation, or cause of action relating to any matters of any kind, whether
presently known or unknown, suspected or unsuspected, that Executive may possess
against any of the Releasees arising from any omissions, acts, facts, or damages
that have occurred up until and including the date Executive signs this
Agreement, including, without limitation:

a. any and all claims relating to or arising from Executive’s employment
relationship with the Company and the termination of that relationship;

b. any and all claims relating to, or arising from, Executive’s right to
purchase, or actual purchase of shares of stock of the Company, including,
without limitation, any claims for fraud, misrepresentation, breach of fiduciary
duty, breach of duty under applicable state corporate law, and securities fraud
under any state or federal law;

c. any and all claims under the law of any jurisdiction including, but not
limited to, wrongful discharge of employment; constructive discharge from
employment; termination in violation of public policy; discrimination;
harassment; retaliation; breach of contract, both express and implied; breach of
covenant of good faith and fair dealing, both express and implied; promissory
estoppel; negligent or intentional infliction of emotional distress; fraud;
negligent or intentional misrepresentation; negligent or intentional
interference with contract or prospective economic advantage; unfair business
practices; defamation; libel; slander; negligence; personal injury; assault;
battery; invasion of privacy; false imprisonment; conversion; and disability
benefits;

 

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d. any and all claims for violation of any federal, state, or municipal statute,
including, but not limited to, Title VII of the Civil Rights Act of 1964; the
Civil Rights Act of 1991; the Rehabilitation Act of 1973; the Americans with
Disabilities Act of 1990; the Equal Pay Act; the Fair Labor Standards Act,
except as prohibited by law; the Fair Credit Reporting Act; the Age
Discrimination in Employment Act of 1967; the Older Workers Benefit Protection
Act; the Employee Retirement Income Security Act of 1974; the Worker Adjustment
and Retraining Notification Act; the Family and Medical Leave Act, except as
prohibited by law; the Sarbanes-Oxley Act of 2002; the Uniformed Services
Employment and Reemployment Rights Act; Washington State Law Against
Discrimination, as amended (Wash. Rev. Code §§ 49.60.010 et seq.); Washington
Equal Pay Law, as amended (Wash. Rev. Code § 49.12.175); Washington sex
discrimination law (Wash. Rev. Code § 49.12.200); Washington age discrimination
law (Wash. Rev. Code § 49.44.090); Washington whistleblower protection law
(Wash. Rev. Code §§ 49.60.210, 49.12.005, and 49.12.130); Washington genetic
testing protection law (Wash. Rev. Code § 49.44.180); Washington Family Care Act
(Wash. Rev. Code § 49.12.270); Washington Minimum Wage Act (Wash. Rev. Code §§
49.46.005 to 49.46.920); Washington wage, hour, and working conditions law
(Wash. Rev. Code §§ 49.12.005 to 49.12.020, 49.12.041 to 49.12.050, 49.12.091,
49.12.101, 49.12.105, 49.12.110, 49.12.121, 49.12.130 to 49.12.150, 49.12.170,
49.12.175, 49.12.185, 49.12.187, 49.12.450); Washington wage payment law (Wash.
Rev. Code §§ 49.48.010 to 49.48.190).;

e. any and all claims for violation of the federal or any state constitution;

f. any and all claims arising out of any other laws and regulations relating to
employment or employment discrimination;

g. any claim for any loss, cost, damage or expense arising out of any dispute
over Company withholding the incorrect amount from any of the proceeds received
by Executive as a result of this Agreement; and

h. any and all claims for attorneys’ fees and costs.

Executive agrees that the release set forth in this section shall be and remain
in effect in all respects as a complete general release as to the matters
released. This release does not extend to any obligations incurred under this
Agreement or to Executive’s vested rights in retirement or similar plans,
programs or accounts. This release does not release claims that cannot be
released as a matter of law, including, but not limited to, Executive’s right to
file a charge with or participate in a charge by the Equal Employment
Opportunity Commission, or any other local, state, or federal administrative
body or government agency that is authorized to enforce or administer laws
related to employment, against the Company (with the understanding that any such
filing or participation does not give Executive the right to recover any
monetary damages against the Company; Executive’s release of claims herein bars
Executive from recovering such monetary relief from the Company).

In addition, nothing in this release shall (i) operate to release or waive
Executive’s rights, if any, under contract, law, as an employee, officer or
director of the Company, to be defended and indemnified by the Company against,
any and all liability incurred with respect to any claim or proceeding to which
Executive is or is threatened to be made a party because of Executive’s service
as an employee, officer or director, or Chairman of the Board of the Company, or
(ii) operate to release or waive Executive’s rights, as an employee, officer or
director of the Company, to be named, protected by and have coverage rights
under the Company’s insurance policies.

As a condition to receiving the Severance Consideration, within seven (7) days
after the Separation Date, Executive agrees to sign and return to the Company
the form of Release of Claims Agreement attached hereto as Appendix B (the
“Release Agreement”). If Executive revokes such Release Agreement he shall not
be entitled to any Severance Consideration.

 

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5. Acknowledgment of Waiver of Claims under ADEA. Executive understands and
acknowledges that he is waiving and releasing any rights he may have under the
Age Discrimination in Employment Act of 1967 (“ADEA”), and that this waiver and
release is knowing and voluntary. Executive understands and agrees that this
waiver and release does not apply to any rights or claims that may arise under
the ADEA after the Effective Date of this Agreement. Executive understands and
acknowledges that the consideration given for this waiver and release is in
addition to anything of value to which Executive was already entitled.

Executive further understands and acknowledges that he has been advised by this
writing that: (a) he should consult with an attorney prior to executing this
Agreement; (b) he has twenty-one (21) days within which to consider and sign
this Agreement; (c) he has seven (7) days following his execution of this
Agreement to revoke this Agreement; (d) this Agreement shall not be effective
until after the revocation period has expired; and (e) nothing in this Agreement
prevents or precludes Executive from challenging or seeking a determination in
good faith of the validity of this waiver under the ADEA, nor does it impose any
condition precedent, penalties, or costs for doing so, unless specifically
authorized by federal law. In the event Executive signs this Agreement and
returns it to the Company in less than the 21-day period identified above,
Executive hereby acknowledges that he has freely and voluntarily chosen to waive
the time period allotted for considering this Agreement. Executive acknowledges
and understands that revocation must be accomplished by a written notification
to the Company’s Corporate Secretary at 2601 Elliott Avenue, Seattle,
Washington, 98121, that is received prior to the Effective Date. The Parties
agree that changes to this Agreement, whether material or immaterial, do not
restart the running of the 21-day period.

6. Unknown Claims. Executive acknowledges that he has been advised to consult
with legal counsel and that he is familiar with the principle that a general
release does not extend to claims that the releaser does not know or suspect to
exist in his favor at the time of executing the release, which, if known by him,
must have materially affected his settlement with the released party. Executive
being aware of said principle agrees to expressly waive any rights he may have
to that effect, as well as under any other statute or common law principles of
similar effect.

7. No Pending or Future Lawsuits. Executive and the Company represent that they
have no lawsuits, claims, or actions pending in their respective names, or on
behalf of any other person or entity, against each other, or in Executive’s
case, against any of the Releasees. Executive also represents that he does not
intend to bring any claims on his own behalf or on behalf of any other person or
entity against the Releasees. The Company represents that as of the Effective
Date of this Agreement, the Company and its directors and executive officers do
not intend to bring against Executive, any claim, complaint, charge, duty,
obligation, or cause of action of any kind or nature. If, within one year
following the Separation Date, the Company commences any formal arbitration or
other formal legal proceeding in a court of law against Executive, Executive
shall be relieved of any and all of the obligations under Sections 10(a) and 12
of this Agreement.

8. Confidentiality. Executive agrees to maintain in complete confidence the
existence of this Agreement, the contents and terms of this Agreement, and the
consideration for this Agreement (hereinafter collectively referred to as
“Separation Information”). Except as required by law or as provided below in
this Section 8, Executive may disclose Separation Information only to his
immediate family members, the Court in any proceedings to enforce the terms of
this Agreement, Executive’s undersigned counsel, and Executive’s accountant and
any professional tax advisor to the extent that they need to know the Separation
Information in order to provide advice on tax treatment or to prepare tax
returns, and must prevent disclosure of any Separation Information to all other
third parties. Executive agrees that he will not publicize, directly or
indirectly, any Separation Information.

 

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Executive acknowledges and agrees that the confidentiality of the Separation
Information is of the essence. The Parties agree that if the Company proves that
Executive breached this Confidentiality provision, the Company shall be entitled
to an award of its costs spent enforcing this provision, including all
reasonable attorneys’ fees associated with the enforcement action, without
regard to whether the Company can establish actual damages from Executive’s
breach, except to the extent that such breach constitutes a legal action by
Executive that directly pertains to the ADEA. Any such individual breach or
disclosure shall not excuse Executive from his obligations hereunder, nor permit
him to make additional disclosures. Executive warrants that he has not
disclosed, orally or in writing, directly or indirectly, any of the Separation
Information to any unauthorized party.

Prior to the disclosure of this Agreement pursuant to any applicable securities
laws, the Company agrees to keep the Separation Information confidential except
for legitimate business reasons on a need-to-know basis. Notwithstanding the
foregoing, if the Company discloses Separation Information in any press release,
public securities filing or otherwise (except to Company employees, agents and
advisors), then Executive may disclose or discuss any Separation Information
that the Company has disclosed.

9. Confidentiality Agreement. Executive agrees to abide by the terms of the
Confidentiality Agreement, specifically including the provisions therein
regarding nondisclosure of the Company’s trade secrets and confidential and
proprietary information. Executive’s signature below constitutes his
acknowledgement and agreement that upon the Company’s request, he shall promptly
return all documents and other items provided to Executive by the Company,
developed or obtained by Executive in connection with his employment with the
Company, or otherwise belonging to the Company.

10. No Cooperation With Third Parties.

a. Executive agrees that he will not counsel or assist any attorneys or their
clients in the presentation or prosecution of any disputes, differences,
grievances, claims, charges, or complaints by any third party against the
Company and/or any officer, director, employee, agent, representative,
shareholder or attorney of the Company, unless under a subpoena, court order, or
other legal obligation to do so.

b. Executive agrees to immediately notify the General Counsel of the Company
upon receipt of any court order, subpoena, or any legal discovery device that
seeks or might require the disclosure or production of the existence or terms of
this Agreement, and to furnish, within three (3) business days of its receipt, a
copy of such subpoena or legal discovery device to the Company. The Company
agrees to immediately notify Executive upon receipt of any court order,
subpoena, or any legal discovery device that seeks or might require the
disclosure or production of the existence or terms of this Agreement, and to
furnish, within three (3) business days of its receipt, a copy of such subpoena
or legal discovery device to Executive.

11. Cooperation with Company. Executive agrees that Executive shall reasonably
cooperate with the Company in the resolution of any matters in which Executive
was involved in during the course of Executive’s employment, or about which
Executive has knowledge, and in the defense or prosecution of any claims or
actions now in existence or which may be brought or threatened in the future
against or on behalf of the Company, including any claims or actions against its
officers, directors and employees.

Executive’s cooperation in connection with such matters, actions and claims
shall include, without limitation, being available to consult with the Company
regarding matters in which Executive has been involved or has knowledge; to
assist the Company in preparing for any proceeding (including, without
limitation, depositions, consultation, discovery or trial); to provide
affidavits reflecting truthful written testimony; to assist with any audit,
inspection, proceeding or other inquiry; and to act as a witness to provide
truthful testimony in connection with any litigation or other legal proceeding
affecting the Company. Executive agrees to keep the Company apprised of his
current contact information, including telephone numbers, work address, home
address, and email address(es), and to promptly respond to communications from
the Company in connection with this Section 11. Executive further

 

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agrees that should Executive be contacted (directly or indirectly) by any person
or entity adverse to the Company, or any representative of such person or
entity, Executive shall promptly, and no later than within 48 hours of such
contact, notify the Chief Executive Officer and General Counsel of the Company
(or in the absence of a Chief Executive Officer, notify the President of the
Company, and in the absence of a General Counsel, notify the Deputy General
Counsel of the Company).

The Company agrees to compensate Executive for all reasonable time incurred
pursuant to this Section 11 at a rate of $550 per hour. Executive shall also be
reimbursed for any documented and reasonable costs and expenses incurred in
connection with providing such cooperation under this Section.

12. Non-Disparagement, No-Hire, Non-Solicitation and Non-Competition. As a
condition of receiving the Severance Consideration, Executive agrees to remain
subject to the Non-Disparagement, No-Hire and Non-Solicitation provisions of
Section 4(b) of the Severance Agreement; provided, however, that the
Non-Disparagement provision will not apply to any statements that Executive
makes in addressing any disparaging statements made by the Company, its officers
and/or its directors regarding Executive or Executive’s performance as an
employee of the Company so long as Executive’s statements are truthful. The
Company shall instruct its officers and directors to refrain from any
disparaging statements about Executive for the same period for which Executive
is subject to a Non-Disparagement requirement under this Section 12 and subject
to Section 7; provided, however, that the Non-Disparagement provision will not
apply to any statements that Company or its officers and directors make in
addressing any disparaging statements made by Executive regarding the Company or
its officers and directors so long as such statements are truthful.

As a further condition of receiving the Severance Consideration, Executive
agrees for a period of one year following the Separation Date, Executive will
not, either directly or indirectly, (i) serve as an advisor, agent, consultant,
director, employee, officer, partner, proprietor or otherwise of, (ii) have any
ownership interest in (except for passive ownership of one percent (1%) or less
of any entity whose securities have been registered under the Securities Act of
1933, as amended, or Section 12 of the Securities Exchange Act of 1934, as
amended) or (iii) participate in the organization, financing, operation,
management or control of, any business in competition with the Company’s
business as conducted by the Company as of the Separation Date. The foregoing
covenant shall cover Executive’s activities in every part of the Territory.
“Territory” shall mean (i) all counties in the State of Washington, (ii) all
other states of the United States of America and (iii) all other countries of
the world.

The covenants contained in this Section 12 shall be construed as a series of
separate covenants, one for each city, county and state of any geographic area
in the Territory. Except for geographic coverage, each such separate covenant
shall be deemed identical in terms to the covenant contained in this Section 12.
If, in any judicial proceeding, a court refuses to enforce any of such separate
covenants (or any part thereof), then such unenforceable covenant (or such part)
shall be eliminated from this Agreement to the extent necessary to permit the
remaining separate covenants (or portions thereof) to be enforced. In the event
the provisions this Section 12 are deemed to exceed the time, geographic or
scope limitations permitted by applicable law, then such provisions shall be
reformed to the maximum time, geographic or scope limitations, as the case may
be, then permitted by such law.

13. Breach. Executive acknowledges and agrees that any material breach of this
Agreement, unless such breach constitutes a legal action by Executive
challenging or seeking a determination in good faith of the validity of the
waiver herein under the ADEA, or of any provision of the Confidentiality
Agreement, shall entitle the Company immediately to recover and/or cease
providing the Severance Consideration provided to Executive under this Agreement
and to obtain damages, except as provided by law.

 

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14. No Admission of Liability. Executive understands and acknowledges that this
Agreement constitutes a compromise and settlement of any and all actual or
potential disputed claims by Executive. No action taken by the Company hereto,
either previously or in connection with this Agreement, shall be deemed or
construed to be (a) an admission of the truth or falsity of any actual or
potential claims or (b) an acknowledgment or admission by the Company of any
fault or liability whatsoever to Executive or to any third party.

15. Costs. The Parties shall each bear their own costs, attorneys’ fees, and
other fees incurred in connection with the preparation of this Agreement.

16. Jurisdiction; Venue. The parties agree that any and all disputes arising out
of the terms of this Agreement, their interpretation and any matters governed by
this Agreement, shall be resolved in a court of competent jurisdiction in King
County, Washington. The parties irrevocably consent to personal and exclusive
jurisdiction and venue in the state and federal courts in King County,
Washington.

17. Tax Consequences. The Company makes no representations or warranties with
respect to the tax consequences of the Severance Consideration and any other
consideration provided to Executive or made on his behalf under the terms of
this Agreement. Executive agrees and understands that he is responsible for
payment, if any, of local, state, and/or federal taxes on the payments and any
other consideration provided hereunder by the Company and any penalties or
assessments thereon. Executive further agrees to indemnify and hold the Company
harmless from any claims, demands, deficiencies, penalties, interest,
assessments, executions, judgments, or recoveries by any government agency
against the Company for any amounts claimed due on account of (a) Executive’s
failure to pay or the Company’s failure to properly withhold, or Executive’s
delayed payment of, federal or state taxes, or (b) damages sustained by the
Company by reason of any such claims, provided that the Company will not seek
indemnification from Executive until after Executive has been adjudicated by a
court of competent jurisdiction to have failed to pay or improperly delayed
payment of any taxes.

18. Authority. The Company represents and warrants that the undersigned has the
authority to act on behalf of the Company and to bind the Company and all who
may claim through it to the terms and conditions of this Agreement. Executive
represents and warrants that he has the capacity to act on his own behalf and on
behalf of all who might claim through him to bind them to the terms and
conditions of this Agreement. Executive warrants and represents that there are
no liens or claims of lien or assignments in law or equity or otherwise of or
against any of the claims or causes of action released herein.

19. No Representations. Executive represents that he has had an opportunity to
consult with an attorney, and has carefully read and understands the scope and
effect of the provisions of this Agreement. Executive has not relied upon any
representations or statements made by the Company that are not specifically set
forth in this Agreement.

20. Severability. In the event that any provision or any portion of any
provision hereof or any surviving agreement made a part hereof becomes or is
declared by a court of competent jurisdiction or arbitrator to be illegal,
unenforceable, or void, this Agreement shall continue in full force and effect
without said provision or portion of provision.

21. Section 409A. Any amount paid under this Agreement that satisfies the
requirements of the “short-term deferral” rule set forth in
Section 1.409A-1(b)(4) of the final treasury regulations issued under
Section 409A of the Code (the “Treasury Regulations”) shall not constitute
deferred compensation for purposes of Section 409A of the Code. Each payment and
benefit payable under this Agreement is intended to constitute separate payments
for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations. Any amount
paid under this Agreement that qualifies as a payment made as a result of an
involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii) of
the Treasury Regulations that does not exceed the Section 409A Limit (as defined
below) shall not constitute deferred compensation subject to Section 409A of the
Code. For purposes of this

 

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Section 21, “Section 409A Limit” will mean the lesser of two (2) times:
(i) Executive’s annualized compensation based upon the annual rate of pay paid
to Executive during the Company’s taxable year preceding the Company’s taxable
year of Executive’s termination of employment as determined under Treasury
Regulation 1.409A-1(b)(9)(iii)(A)(1); or (ii) the maximum amount that may be
taken into account under a qualified plan pursuant to Section 401(a)(17) of the
Code for the year in which the Separation Date occurs. With respect to
reimbursements (whether such reimbursements are for business expenses or, to the
extent permitted under the Company’s policies, other expenses) and/or in-kind
benefits, in each case, that constitute deferred compensation subject to
Section 409A of the Code, each of the following shall apply: (1) no
reimbursement of expenses incurred by the Executive during any taxable year
shall be made after the last day of the following taxable year of the Executive,
(2) the amount of expenses eligible for reimbursement, or in-kind benefits
provided, during a taxable year of the Executive shall not affect the expenses
eligible for reimbursement, or in-kind benefits to be provided, to the Executive
in any other taxable year, and (3) the right to reimbursement of such expenses
or in-kind benefits shall not be subject to liquidation or exchange for another
benefit. The Company and Executive agree that this Agreement and the rights
granted to the Executive hereunder are intended to meet the requirements of
paragraphs (2), (3) and (4) of Section 409A(a)(1)(A) of the Code.
Notwithstanding anything to the contrary in this Agreement, no severance
payments will become payable under this Agreement until Employee has a
“separation from service” within the meaning of Section 409A of the Code.

This Section 21 is intended to comply with the requirements of Section 409A of
the Code so that none of the severance payments and benefits to be provided
hereunder will be subject to either (1) the six (6) month delay which may
otherwise be required with respect to payments of deferred compensation to
“specified employees” as defined in Section 409A, and (b) any additional tax
imposed under Section 409A, and any ambiguities herein will be interpreted to so
comply. The Company and Executive agree to work together in good faith to
consider amendments to this Agreement and to take such reasonable actions which
are necessary, appropriate or desirable to avoid imposition of any additional
tax or income recognition prior to actual payment to Executive under
Section 409A.

22. Entire Agreement. This Agreement represents the entire agreement and
understanding between the Company and Executive concerning the subject matter of
this Agreement and Executive’s employment with and separation from the Company
and the events leading thereto and associated therewith, and supersedes and
replaces any and all prior agreements and understandings concerning the subject
matter of this Agreement and Executive’s relationship with the Company,
including (but not by way of limitation) the Severance Agreement, Retention
Agreement, and Confidentiality Agreement, but with the exception of the Stock
Agreements and Section 4(b) of the Severance Agreement, all of which shall
survive this Agreement.

23. No Oral Modification. This Agreement may only be amended in a writing signed
by Executive and the Company’s then acting Chief Executive Officer or a
specifically-authorized member of the Board.

24. Governing Law. This Agreement shall be governed by the laws of the State of
Washington, without regard for choice-of-law provisions. Executive consents to
personal and exclusive jurisdiction and venue in the State of Washington.

25. Effective Date.

a. Executive has seven (7) days after the date that he signs this Agreement to
revoke it. This Agreement will become effective on the eighth (8th) day after
Executive signed this Agreement, so long as it has been signed by the Parties
and has not been revoked by Executive before that date.

 

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b. Executive has seven (7) days after the date that he signs the Release
Agreement to revoke it. The Release Agreement will become effective on the
eighth (8th) day after Executive signed such Release Agreement, so long as it
has been signed by the Parties and has not been revoked by Executive before that
date (the “Effective Date”).

26. Expiration of Agreement. This Agreement is executable during the period
commencing on March 26, 2011 and ending at 5:00 p.m. (PDT) on April 15, 2011. If
Executive has not executed this Agreement and the Release Agreement by April 22,
2011, then this Agreement is null and void.

27. Counterparts. This Agreement may be executed in counterparts and by
facsimile, and each counterpart and facsimile shall have the same force and
effect as an original and shall constitute an effective, binding agreement on
the part of each of the undersigned.

28. Voluntary Execution of Agreement. Executive understands and agrees that he
executed this Agreement voluntarily, without any duress or undue influence on
the part or behalf of the Company or any third party, with the full intent of
releasing all of his claims against the Company and any of the other Releasees.
Executive acknowledges that:

 

  (a) He has read this Agreement;

 

  (b) He has been represented in the preparation, negotiation, and execution of
this Agreement by legal counsel of his own choice or has elected not to retain
legal counsel;

 

  (c) He understands the terms and consequences of this Agreement and of the
releases it contains; and

 

  (d) He is fully aware of the legal and binding effect of this Agreement.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective
dates set forth below.

 

    Robert Kimball, an individual

Dated: 3/28/2011        

   

/s/ Robert Kimball

    Robert Kimball     REALNETWORKS, INC.

Dated: 3/28/2011        

    By  

/s/ Janice Roberts

        Janice Roberts, Compensation Committee Chair

 

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APPENDIX A

Kimball Restricted Stock Units

 

Grant Date

 

No. Granted

          Price            

Released

 

Vested

 

Unvested

 

Outstanding

2/22/2008

  22,500   $ 0.0000      12,240   16,876   5,624   5,624

9/9/2010

  125,000   $ 0.0000      10,836   15,625   109,375   109,375                  
      147,000     23,076   32,501   114,999   114,999

Kimball Non-Qualified Stock Options

 

Grant Date

 

No. Granted

          Price            

Vested

 

Unvested

 

Outstanding

8/31/2001

  200,000   $ 7.2200      200,000   0   200,000

8/31/2001

  15,000   $ 7.2200      15,000   0   15,000

8/31/2001

  40,000   $ 7.2200      40,000   0   40,000

10/12/2001

  61,450   $ 5.9400      61,450   0   61,450

8/5/2002

  50,000   $ 3.7600      50,000   0   10,000

1/27/2003

  100,000   $ 3.2300      100,000   0   10,000

7/24/2003

  50,000   $ 6.1200      50,000   0   50,000

1/18/2005

  50,000   $ 5.8400      50,000   0   50,000

3/15/2006

  80,000   $ 8.2700      80,000   0   80,000

11/9/2006

  70,000   $ 11.3800      70,000   0   70,000

4/6/2007

  135,000   $ 7.6900      118,125   16,875   135,000

9/18/2007

  75,000   $ 6.4900      65,625   9,375   75,000

2/22/2008

  67,500   $ 6.0100      50,626   16,874   67,500

2/14/2009

  130,000   $ 2.7500      65,000   65,000   130,000

2/1/2010

  500,000   $ 4.2700      125,000   375,000   500,000

2/17/2010

  60,000   $ 4.4200      60,000   0   60,000                     1,683,950    
1,200,826   483,124   1,553,950

 

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APPENDIX B

RELEASE AGREEMENT

Executive agrees that the Severance Consideration represents settlement in full
of all outstanding obligations owed to Executive by the Company and its current
and former officers, directors, employees, agents, investors, attorneys,
shareholders, administrators, affiliates, benefit plans, plan administrators,
insurers, trustees, divisions, and subsidiaries, and predecessor and successor
corporations and assigns (collectively, the “Releasees”). Executive, on his own
behalf and on behalf of his respective heirs, family members, executors, agents,
and assigns, hereby and forever releases the Releasees from, and agrees not to
sue concerning, or in any manner to institute, prosecute, or pursue, any claim,
complaint, charge, duty, obligation, or cause of action relating to any matters
of any kind, whether presently known or unknown, suspected or unsuspected, that
Executive may possess against any of the Releasees arising from any omissions,
acts, facts, or damages that have occurred up until and including the date
Executive signs this Agreement, including, without limitation:

a. any and all claims relating to or arising from Executive’s employment
relationship with the Company and the termination of that relationship;

b. any and all claims relating to, or arising from, Executive’s right to
purchase, or actual purchase of shares of stock of the Company, including,
without limitation, any claims for fraud, misrepresentation, breach of fiduciary
duty, breach of duty under applicable state corporate law, and securities fraud
under any state or federal law;

c. any and all claims under the law of any jurisdiction including, but not
limited to, wrongful discharge of employment; constructive discharge from
employment; termination in violation of public policy; discrimination;
harassment; retaliation; breach of contract, both express and implied; breach of
covenant of good faith and fair dealing, both express and implied; promissory
estoppel; negligent or intentional infliction of emotional distress; fraud;
negligent or intentional misrepresentation; negligent or intentional
interference with contract or prospective economic advantage; unfair business
practices; defamation; libel; slander; negligence; personal injury; assault;
battery; invasion of privacy; false imprisonment; conversion; and disability
benefits;

d. any and all claims for violation of any federal, state, or municipal statute,
including, but not limited to, Title VII of the Civil Rights Act of 1964; the
Civil Rights Act of 1991; the Rehabilitation Act of 1973; the Americans with
Disabilities Act of 1990; the Equal Pay Act; the Fair Labor Standards Act,
except as prohibited by law; the Fair Credit Reporting Act; the Age
Discrimination in Employment Act of 1967; the Older Workers Benefit Protection
Act; the Employee Retirement Income Security Act of 1974; the Worker Adjustment
and Retraining Notification Act; the Family and Medical Leave Act, except as
prohibited by law; the Sarbanes-Oxley Act of 2002; the Uniformed Services
Employment and Reemployment Rights Act; Washington State Law Against
Discrimination, as amended (Wash. Rev. Code §§ 49.60.010 et seq.); Washington
Equal Pay Law, as amended (Wash. Rev. Code § 49.12.175); Washington sex
discrimination law (Wash. Rev. Code § 49.12.200); Washington age discrimination
law (Wash. Rev. Code § 49.44.090); Washington whistleblower protection law
(Wash. Rev. Code §§ 49.60.210, 49.12.005, and 49.12.130); Washington genetic
testing protection law (Wash. Rev. Code § 49.44.180); Washington Family Care Act
(Wash. Rev. Code § 49.12.270); Washington Minimum Wage Act (Wash. Rev. Code §§
49.46.005 to 49.46.920); Washington wage, hour, and working conditions law
(Wash. Rev. Code §§ 49.12.005 to 49.12.020, 49.12.041 to 49.12.050, 49.12.091,
49.12.101, 49.12.105, 49.12.110, 49.12.121, 49.12.130 to 49.12.150, 49.12.170,
49.12.175, 49.12.185, 49.12.187, 49.12.450); Washington wage payment law (Wash.
Rev. Code §§ 49.48.010 to 49.48.190).;

 

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e. any and all claims for violation of the federal or any state constitution;

f. any and all claims arising out of any other laws and regulations relating to
employment or employment discrimination;

g. any claim for any loss, cost, damage or expense arising out of any dispute
over Company withholding the incorrect amount from any of the proceeds received
by Executive as a result of this Agreement; and

h. any and all claims for attorneys’ fees and costs.

Executive agrees that the release set forth in this section shall be and remain
in effect in all respects as a complete general release as to the matters
released. This release does not extend to any obligations incurred under this
Agreement or to Executive’s vested rights in retirement or similar plans,
programs or accounts. This release does not release claims that cannot be
released as a matter of law, including, but not limited to, Executive’s right to
file a charge with or participate in a charge by the Equal Employment
Opportunity Commission, or any other local, state, or federal administrative
body or government agency that is authorized to enforce or administer laws
related to employment, against the Company (with the understanding that any such
filing or participation does not give Executive the right to recover any
monetary damages against the Company; Executive’s release of claims herein bars
Executive from recovering such monetary relief from the Company).

In addition, nothing in this release shall (i) operate to release or waive
Executive’s rights, if any, under contract, law, as an employee, officer or
director of the Company, to be defended and indemnified by the Company against,
any and all liability incurred with respect to any claim or proceeding to which
Executive is or is threatened to be made a party because of Executive’s service
as an employee, officer or director, or Chairman of the Board of the Company, or
(ii) operate to release or waive Executive’s rights, as an employee, officer or
director of the Company, to be named, protected by and have coverage rights
under the Company’s insurance policies.

Acknowledgment of Waiver of Claims under ADEA. Executive understands and
acknowledges that he is waiving and releasing any rights he may have under the
Age Discrimination in Employment Act of 1967 (“ADEA”), and that this waiver and
release is knowing and voluntary. Executive understands and agrees that this
waiver and release does not apply to any rights or claims that may arise under
the ADEA after the Effective Date of this Agreement. Executive understands and
acknowledges that the consideration given for this waiver and release is in
addition to anything of value to which Executive was already entitled.

Executive further understands and acknowledges that he has been advised by this
writing that: (a) he should consult with an attorney prior to executing this
Release Agreement; (b) he has twenty-one (21) days within which to consider and
sign this Release Agreement; (c) he has seven (7) days following his execution
of this Release Agreement to revoke this Release Agreement; (d) this Release
Agreement shall not be effective until after the revocation period has expired;
and (e) nothing in this Release Agreement prevents or precludes Executive from
challenging or seeking a determination in good faith of the validity of this
waiver under the ADEA, nor does it impose any condition precedent, penalties, or
costs for doing so, unless specifically authorized by federal law. In the event
Executive signs this Release Agreement and returns it to the Company in less
than the 21-day period identified above, Executive hereby acknowledges that he
has freely and voluntarily chosen to waive the time period allotted for
considering this Release Agreement. Executive acknowledges and understands that
revocation must be accomplished by a written notification to the Company’s
Corporate Secretary at 2601 Elliott Avenue, Seattle, Washington, 98121, that is
received prior to the Effective Date. The Parties agree that changes to this
Agreement, whether material or immaterial, do not restart the running of the
21-day period.

 

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Unknown Claims. Executive acknowledges that he has been advised to consult with
legal counsel and that he is familiar with the principle that a general release
does not extend to claims that the releaser does not know or suspect to exist in
his favor at the time of executing the release, which, if known by him, must
have materially affected his settlement with the released party. Executive being
aware of said principle agrees to expressly waive any rights he may have to that
effect, as well as under any other statute or common law principles of similar
effect.

IN WITNESS WHEREOF, the Parties have executed this Release Agreement on the
respective dates set forth below (which shall be no earlier than the Separation
Date)

 

    Robert Kimball, an individual

Dated:                     

   

 

    Robert Kimball     REALNETWORKS, INC.

Dated:                     

    By  

 

        Janice Roberts, Compensation Committee Chair

 

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