Document:

exv10w11

 

Exhibit 10.11

RealNetworks, Inc. 2005 Stock Incentive Plan

Non-Qualified Stock Option Terms and Conditions

     Non-Qualified Stock Option Terms and Conditions (the “Agreement”) made and entered into as of
the effective date (the “Grant Date”) set forth in the Notice of Grant of Stock Options and Option
Agreement attached hereto (the “Notice of Grant”), by and between RealNetworks, Inc., a Washington
corporation (the “Company”), and you (the “Optionee”) pursuant to the RealNetworks, Inc. 2005 Stock
Incentive Plan (the “Plan”). Capitalized terms not defined in this Agreement have the meanings
ascribed to them in the Plan.

     1. Grant of Stock Option. The Company hereby grants to the Optionee pursuant to the
Plan an option (the “Option”) to purchase, subject to the terms of this Agreement and the Plan the
number of Shares set forth in the Notice of Grant at the purchase price per Share set forth in the
Notice of Grant (the “Option Exercise Price”).

     2. Non-Qualified Stock Option. The Option is a non-qualified stock option and is not
intended to qualify as an incentive stock option under Section 422 of the Code.

     3. Expiration Date. The Option expires on the seventh anniversary of the Grant Date
(the “Expiration Date”) and must be exercised on or before the earlier of the Expiration Date or
the date on which this Option is terminated in accordance with the provisions of Sections 5 and 6.

     4. Vesting. Except as otherwise provided herein, the vesting schedule applicable to
the Option shall be as set forth in the Notice of Grant, and the Option may only be exercised to
the extent that it is vested. The Option shall cease to vest upon the Optionee’s termination of
employment, and may be exercised after the date of the Optionee’s termination of employment only as
set forth Sections 5 and 6. Notwithstanding the foregoing, the Committee may, in its discretion,
accelerate the date that any installment of the Option vests.

     5. Termination of Employment.

          (a) Termination Other Than for Cause. If the Company terminates the employment of the
Optionee for any reason other than for Cause (as defined in paragraph (c) of this Section) and the
Option is not fully vested, the next installment of the Option scheduled to vest (if any) shall
vest on a pro rata basis for the portion of the year elapsed since the date on which the vesting of
the option commences or the last anniversary thereof, expressed in full months (the “Pro Rata
Portion”), provided that the Optionee executes and delivers a Settlement Agreement and
Release (“Release”) satisfactory to the Company before the Effective Date (as defined in the
Release).

               If the employment of the Optionee terminates, other than by reason of death or disability (as
defined in Section 6) or termination by the Company for Cause (as defined in paragraph (c) of this
Section), the Option shall expire and may no longer be exercised after three months from the
termination of the Optionee’s employment, but in no event later than the Expiration Date. For
purposes hereof, employment shall not be considered as having terminated during any leave of
absence if the leave of absence has been approved in writing by the Company; in the event of any
unpaid leave of absence, vesting of the Option shall be suspended (and the unpaid portion of the
leave of absence shall be added to all vesting installment dates) unless otherwise determined by
the Committee.

          (b) Termination for Cause. If the employment of the Optionee is terminated by the
Company for Cause (as defined below), the Option shall expire and may no longer be exercised to any
extent whatsoever.

          (c) Cause. For purposes of this Agreement, “Cause” means conduct involving one or
more of the following: (i) the conviction of the Optionee, or plea of nolo
contendere by the Optionee to, a felony or misdemeanor involving moral turpitude; (ii) the
indictment of the Optionee for a felony or misdemeanor involving moral turpitude under the federal
securities laws; (iii) the substantial and continuing failure of the Optionee after written notice
thereof to render services to the Company in accordance with the terms or requirements of the
Optionee’s employment for reasons other than illness or incapacity; (iv) the willful misconduct or
gross negligence by the Optionee; (v) fraud, embezzlement, theft, misrepresentation or dishonesty
by the Optionee involving the Company or any Subsidiary, or willful violation by the Optionee of a
policy or procedure of the Company, resulting in any case in significant harm to the Company; or
(vi) the Optionee’s violation of any confidentiality or non-competition agreements with the Company
or its Subsidiaries.

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     6. Death; Disability.

          (a) Death. If the Optionee’s employment terminates due to the Optionee’s death, the
Option will fully vest on the date of termination of employment and may be exercised by the
Optionee’s estate, legal representative or beneficiary to whom the Option has been transferred
pursuant to Section 10, at any time within one (1) year after the date of death.

          (b) Disability. If the Optionee’s employment is terminated by reason of his or her
disability, the Option may be exercised, to the extent vested on the date employment terminates, at
any time within one (1) year after such termination of employment, but not later than the
Expiration Date. For purposes hereof, “disability” means “permanent and total disability” as
defined in Section 22(e)(3) of the Code.

     7. Exercise of Option. The Option may be exercised by written notice to the Company
or to such agent as the Company shall designate. The notice shall state the election to exercise
the Option, the number of Shares for which it is being exercised and shall be signed by the person
or persons so exercising the Option. The Option may not be exercised unless such exercise is in
compliance, to the reasonable satisfaction of the Company with all applicable federal and state
securities laws as in effect on the date of exercise. The Option may not be exercised as to fewer
than 100 Shares unless it is exercised as to all Shares as to which the Option is then exercisable.

     The exercise notice must be accompanied by payment of the full exercise price of the Shares
for which the Option is being exercised, or evidence of satisfaction of one of the alternative
payment methods set forth on Section 8, and the Company shall deliver a certificate or certificates
representing such Shares, or cause such Shares to be delivered electronically, as soon as
practicable after the notice shall be received. The Company may postpone such delivery until it
receives satisfactory proof that the issuance of such Shares will not violate any of the provisions
of the Securities act of 1933, as amended, or the Exchange Act, any rules or regulations of the
Securities and Exchange Commission (the “SEC”) promulgated thereunder, or the requirements of
applicable state law relating to authorization, issuance or sale of securities, or until there has
been compliance with the provisions of such acts or rules. The Optionee understands that the
Company is under no obligation to register or qualify the Shares with the SEC, any state securities
commission or any stock exchange to effect such compliance. The certificate or certificates shall
be registered in the name of the person or persons so exercising the Option (or, if the Option is
exercised by the Optionee and the Optionee shall so request in the notice exercising the Option,
shall be registered in the name of the Optionee and another person jointly, with right of
survivorship). In the event the Option shall be exercised, pursuant to Section 6 hereof, by any
person or persons other than the Optionee, such notice shall be accompanied by appropriate proof of
the right of such person or persons to exercise the Option.

     8. Payment of Exercise Price.

          (a) Payment Options. The exercise price of the Option shall be paid by one or any
combination of the following forms of payment:

               (i) in cash, or by check payable to the order of the Company; or

               (ii) delivery of an irrevocable and unconditional undertaking, satisfactory in form and
substance to the Company, by a creditworthy broker to deliver promptly to the Company sufficient
funds to pay the exercise price, or delivery by the Optionee to the Company of a copy of
irrevocable and unconditional instructions, satisfactory in form and substance to the Company, to a
creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the
exercise price; or

               (iii) by delivery of Shares having a Fair Market Value equal as of the date of exercise to the
exercise price, subject to paragraph (b) and in accordance with procedures established by the
Committee, provided the Shares are then traded on a national securities exchange or on the NASDAQ
Stock Market (or successor trading system).

               (b) Limitations on Payment by Delivery of Shares. The Optionee may not pay any part
of the exercise price hereof by transferring Shares to the Company unless such Shares have been
owned by the Optionee free of any substantial risk of forfeiture for at least six months unless
otherwise determined by the Committee, are free and clear of all liens, claims, encumbrances or
security interests.

     9. Option Not Transferable. The Option is not transferable or assignable except by
will or by the laws of descent and distribution. During the Optionee’s lifetime only the Optionee
can exercise the Option.

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     10. No Obligation to Continue Employment. Neither the Plan, this Agreement, nor the
grant of the Option imposes any obligation on the Company or its Subsidiaries to continue the
Optionee’s employment, or limit in any way the rights of the Company or a Subsidiary to terminate
the Optionee’s employment at any time.

     11. No Rights as Shareholder. The Optionee shall have no rights as a stockholder with
respect to any Shares subject to the Option until such time as the Optionee has satisfied all of
the requirements of this Agreement for the delivery of Shares pursuant to the exercise of the
Option. Except as is expressly provided in the Plan with respect to certain changes in the
capitalization of the Company, no adjustment shall be made for dividends or similar rights for
which the record date is prior to such date of exercise.

     12. Adjustment for Capital Changes. The Plan contains provisions covering the
treatment of options in the event of mergers, stock splits, spin-offs and certain other corporate
transactions. Provisions in the Plan for such adjustment are hereby made applicable hereunder and
are incorporated herein by reference.

     13. Change in Control. Provisions regarding a Change in Control are set forth on
Appendix A.

     14. Withholding. Prior to the issuance of Shares pursuant to the exercise of the
Option the Optionee must pay to the Company, or make satisfactory provision to the Company for
payment of, any federal, state or local withholding taxes required by law to be withheld in respect
of the Option. The Optionee agrees that the Company may withhold such taxes from the Optionee’s
wages or other remuneration. In the discretion of the Company, the taxes may be withheld in kind
from the Shares deliverable to the Optionee on exercise of the Option.

     15. Policy on the Avoidance of Insider Trading. The Optionee acknowledges that he/she
has received and read the RealNetworks Policy on the Avoidance of Insider Trading, and, if
applicable, the Addendum to the Policy on the Avoidance of Insider Trading, and the Optionee agrees
to comply with the Policy’s terms, together with the Addendum, if applicable.

     16. Miscellaneous.

          (a) Notices. All notices hereunder shall be in writing and shall be deemed given when
sent by certified or registered mail, postage prepaid, return receipt requested, if to the
Optionee, to the address indicated on the signature page below or at the most recent address shown
on the records of the Company, and if to the Company, to the Company’s principal office, attention
of the Corporate Secretary.

          (b) Entire Agreement; Modification. This Agreement and the Plan constitute the entire
agreement between the parties relative to the subject matter hereof, and supersedes all
understandings between the parties relating to the subject matter of this Agreement. This
Agreement may be modified, amended or rescinded only by a written agreement executed by both
parties.

          (c) Cost of Litigation. In any action at law or in equity to enforce any of the
provisions or rights under this Agreement, the unsuccessful party to such litigation, as determined
by the court in a final judgment or decree, shall pay the successful party or parties all costs,
expenses and reasonable attorneys’ fees incurred by the successful party or parties (including
without limitation costs, expenses and fees in any appellate proceedings), and if the successful
party recovers judgment in any such action or proceeding, such costs, expenses and attorney’s fees
shall be included as part of the judgment.

          (d) Severability. The invalidity, illegality or unenforceability of any provision of
this Agreement shall in no way affect the validity, legality or enforceability of any other
provision.

          (e) Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns, including the Optionee’s
heirs, executors, administrators and legal representatives.

          (f) Governing Law. This Agreement shall be governed by and interpreted in accordance
with the laws of the State of Washington, without giving effect to the principles of the conflicts
of laws thereof.

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APPENDIX A

Change in Control

     Notwithstanding anything contained herein to the contrary, if (i) the Option is continued,
assumed, converted or substituted for immediately following the Change in Control and (ii) within
twenty-four (24) months after a Change in Control the Optionee’s employment is terminated by the
Company or its successor without Cause or by the Optionee for Good Reason, all of the Shares
subject to the Option shall be vested immediately and the Option may be exercised at any time
within twenty-four (24) months following such termination, but not later than the Expiration Date.
Furthermore and notwithstanding anything contained herein to the contrary, if the Option is not
continued, assumed, converted or substituted for immediately following the Change in Control, all
of the Shares subject to the Option shall vest immediately upon the Change in Control and the
Option may be exercised at any time within twelve (12) months thereafter. The Option shall be
considered to be continued, assumed, converted or substituted for:

	 	(A)	 	if there is no change in the number of outstanding Shares and the Change in Control
does not result from the consummation of a merger, consolidation, statutory share exchange,
reorganization or similar form of corporate transaction, there are no changes to the terms
and conditions of this option that materially and adversely affect this option, including
the number of Shares subject to the Option and the exercise price of the option; or
	 
	 	(B)	 	if there is a change in the number of outstanding Shares and/or the Change in Control
does result from the consummation of a merger, consolidation, statutory share exchange,
reorganization or similar form of corporate transaction: (1) the Shares subject to the
Option and the exercise price of the option are adjusted in a manner which is not
materially less favorable than as provided under Section 424(a) of the Code and regulations
thereunder, (2) if applicable, the Shares subject to the Option are converted into the
common stock of the Parent Corporation or, if there is no Parent Corporation, the Surviving
Corporation (as such terms are defined below), and (3) there are no other changes to the
terms and conditions of this option that materially and adversely affect the Option.

     For purposes of this Agreement:

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

          (i) during any period of twenty-four (24) consecutive months, individuals who, at the
beginning of the period constitute the Board (the “Incumbent Directors”) cease for any reason to
constitute at least a majority of the Board, provided that any person becoming a director
subsequent to the initial public offering whose election or nomination for election was approved by
a vote of at least a majority of the Incumbent Directors then on the Board (either by a specific
vote or by approval of the proxy statement of the Company in which such person is named as a
nominee for director, without written objection to such nomination) shall be an Incumbent Director;
provided, however, that no individual initially elected or nominated as a director
of the Company as a result of an actual or threatened election contest with respect to directors or
as a result of any other actual or threatened solicitation of proxies by or on behalf of any person
other than the Board shall be deemed to be an Incumbent Director;

          (ii) any “person” (as such term is defined in the Exchange Act and as used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing
35% or more of the combined voting power of the Company’s then outstanding securities eligible to
vote for the election of the Board (the “Company Voting Securities”); provided,
however, that the event described in this paragraph (ii) shall not be deemed to be a Change
in Control by virtue of any of the following acquisitions: (A) by the Company or any subsidiary,
(B) by any employee benefit plan (or related trust) sponsored or maintained by the Company or any
subsidiary, (C) by any underwriter temporarily holding securities pursuant to an offering of such
securities, (D) pursuant to a Non-Qualifying Transaction, as defined in paragraph (iii), or (E) by
any person of Voting Securities from the Company, if a majority of the Incumbent Board approves in
advance the acquisition of beneficial ownership of 35% or more of Company Voting Securities by such
person;

          (iii) the consummation of a merger, consolidation, statutory share exchange, reorganization or
similar form of corporate transaction involving the Company or any of its subsidiaries that
requires the approval of the Company’s stockholders, whether for such transaction or the issuance
of securities in the transaction (a “Business Combination”), unless immediately following such
Business Combination: (A) more than 50% of the total voting power of (x) the corporation resulting
from such Business Combination (the “Surviving Corporation”), or (y) if applicable, the ultimate
parent corporation that directly or indirectly has beneficial ownership of 100% of the voting
securities eligible to elect directors of the Surviving Corporation (the “Parent Corporation”), is
represented by Company Voting Securities that were outstanding immediately prior to such Business
Combination (or, if applicable, is represented by shares into which such Company Voting Securities
were converted pursuant to such Business Combination), and such voting power among the holders
thereof is in substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business Combination, (B) no person
(other than any

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employee benefit plan (or related trust) sponsored or maintained by the Surviving Corporation or the Parent Corporation), is or becomes
the beneficial owner, directly or indirectly, of 35% or more of the total voting power of the
outstanding voting securities eligible to elect directors of the Parent Corporation (or, if there
is no Parent Corporation, the Surviving Corporation) and (C) at least half of the members of the
board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving
Corporation) following the consummation of the Business Combination were Incumbent Directors at the
time of the Board’s approval of the execution of the initial agreement providing for such Business
Combination (any Business Combination which satisfies all of the criteria specified in (A), (B) and
(C) above shall be deemed to be a “Non-Qualifying Transaction”); or

          (iv) the shareholders of the Company approve a plan of complete liquidation or dissolution of
the Company or the consummation of a sale of all or substantially all of the Company’s assets.

          Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because
any person acquires beneficial ownership of more than 35% of the Company Voting Securities as a
result of the acquisition of Company Voting Securities by the Company which reduces the number of
Company Voting Securities outstanding; provided, that if after such acquisition by
the Company such person becomes the beneficial owner of additional Company Voting Securities that
increases the percentage of outstanding Company Voting Securities beneficially owned by such
person, a Change in Control of the Company shall then occur.

          “Good Reason” means:

          (i) a reduction by the Company or its successor of more than 10% in the Optionee’s rate of
annual base salary as in effect immediately prior to such Change in Control;

          (ii) a reduction by the Company or its successor of more than 10% of the Optionee’s individual
annual target or bonus opportunity; or

          (iii) any requirement of the Company that Optionee be based anywhere more than fifty (50)
miles from Optionee’s primary office location at the time of the Change in Control and more than
fifty (50) miles from Optionee’s principal residence at the time of the Change in Control.

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Exhibit 10.12

RealNetworks, Inc. 2005 Stock Incentive Plan

Restricted Stock Units Terms and Conditions

     Restricted Stock Units Terms and Conditions (the “Agreement”) made and entered into as of the
effective date (the “Grant Date”) set forth in the Notice of Grant of Restricted Stock Units and
Restricted Stock Units Agreement attached hereto (the “Notice of Grant”), by and between
RealNetworks, Inc., a Washington corporation (the “Company”), and you (the “Participant”) pursuant
to the RealNetworks, Inc. 2005 Stock Incentive Plan (the “Plan”). Capitalized terms not defined in
this Agreement have the meanings ascribed to them in the Plan.

     1. Grant of Restricted Stock Units. The Company hereby grants to the Participant
pursuant to the Plan Restricted Stock Units, subject to the terms of this Agreement and the Plan.
Each Restricted Stock Unit shall be deemed to be the equivalent of one Share.

     2. Account. The Company shall credit to a bookkeeping account (the “Account”)
maintained by the Company for the Participant’s benefit the Restricted Stock Units. On each date
that cash dividends are paid on the Shares, the Company will credit the Account with a number of
additional Restricted Stock Units equal to the result of dividing (i) the product of the total
number of Restricted Stock Units credited to the Account on the record date for such dividend and
the per Share amount of such dividend by (ii) the Fair Market Value of one Share on the date such
dividend is paid by the Company to shareholders. The additional Restricted Stock Units shall be or
become vested to the same extent as the Restricted Stock Units that resulted in the crediting of
such additional Restricted Stock Units.

     3. Vesting. Except as otherwise provided herein, the vesting schedule applicable to
the Restricted Stock Units credited to the Account shall be as set forth in the Notice of Grant.
The Restricted Stock Units shall cease to vest upon the Participant’s termination of employment.
Notwithstanding the foregoing, the Committee may, in its discretion, accelerate the date that any
installment of the Restricted Stock Units vests.

     4. Termination of Employment.

          (a) Termination by Company Other Than for Cause. If the Company terminates the
employment of the Participant for any reason other than for Cause (as defined in paragraph (c) of
this Section) and the Restricted Stock Units credited to the Account are not fully vested, the next
installment of the Restricted Stock Units credited to the Account scheduled to vest (if any) shall
vest on a pro rata basis for the portion of the year elapsed since the date on which the vesting of
the Restricted Stock Units credited to the Account commences or the last anniversary thereof,
expressed in full months (the “Pro Rata Portion”), provided that the Participant executes
and delivers a Settlement Agreement and Release (“Release”) satisfactory to the Company before the
Effective Date (as defined in the Release). For purposes hereof, employment shall not be
considered as having terminated during any leave of absence if the leave of absence has been
approved in writing by the Company; in the event of any unpaid leave of absence, vesting of the
Restricted Stock Units credited to the Account shall be suspended (and the unpaid portion of the
leave of absence shall be added to all vesting installment dates) unless otherwise determined by
the Committee.

          (b) Termination by Company for Cause. If the employment of the Participant is
terminated by the Company for Cause (as defined below), the Restricted Stock Units credited to the
Account that were not vested on the date of such termination of employment shall be immediately
forfeited.

          (c) Cause. For purposes of this Agreement, “Cause” means conduct involving one or
more of the following: (i) the conviction of the Participant, or plea of nolo
contendere by the Participant to, a felony or misdemeanor involving moral turpitude; (ii)
the indictment of the Participant for a felony or misdemeanor involving moral turpitude under the
federal securities laws; (iii) the substantial and continuing failure of the Participant after
written notice thereof to render services to the Company in accordance with the terms or
requirements of the Participant’s employment for reasons other than illness or incapacity; (iv) the
willful misconduct or gross negligence by the Participant; (v) fraud, embezzlement, theft,
misrepresentation or dishonesty by the Participant involving the Company or any Subsidiary, or
willful violation by the Participant of a policy or procedure of the Company, resulting in any case
in significant harm to the Company; or (vi) the Participant’s violation of any confidentiality or
non-competition agreements with the Company or its Subsidiaries.

          (d) Termination by Participant. If the Participant terminates his or her employment
for any reason other than death or disability, the Restricted Stock Units credited to the Account
that were not vested on the date of such termination of employment shall be immediately forfeited.

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     5. Death; Disability.

          (a) Death. If the Participant’s employment terminates due to the Participant’s death,
the Restricted Stock Units credited to the Account will fully vest on the date of termination of
employment.

          (b) Disability. If the Participant’s employment is terminated by reason of his or her
disability and the Restricted Stock Units credited to the Account are not fully vested, the Pro
Rata Portion of the next installment of the Restricted Stock Units credited to the Account
scheduled to vest (if any) shall vest. For purposes hereof, “disability” means “permanent and
total disability” as defined in Section 22(e)(3) of the Code.

     6. Payment of Restricted Stock Units. The Company shall make a payment to the
Participant of the vested Restricted Stock Units credited to the Account as provided in Section 7
upon the date the Restricted Stock Units vest. The Participant may elect, in accordance with
procedures adopted by the Company, to change the payment date determined in accordance with the
first sentence of the preceding paragraph by written notice to the Company at least 12 months prior
to the payment date, provided that the new payment date must be at least five years after the
previously applicable payment date. Notwithstanding the foregoing, upon:

          (a) The death of the Participant prior to the new payment date, payment shall be accelerated
to the date of the Participant’s death and paid in accordance with the provisions of Section 9; and

          (b) The occurrence of a Section 409A CIC (as defined in Appendix B), payment shall be
accelerated to the date of such Section 409A CIC and paid in Shares (or, if applicable, in shares
of the common stock of the Surviving Corporation or the Parent Corporation).

     7. Form of Payment. Payment pursuant to Section 6 shall be made in Shares equal to
the number of vested Restricted Stock Units credited to the Account. Payment shall be made as soon
as practicable after the applicable payment date, but in no event later than 30 days after the date
established pursuant to Section 7.

     8. Beneficiary. In the event of the Participant’s death prior to payment of the
Restricted Stock Units credited to the Account, payment shall be made to the last beneficiary
designated in writing that is received by the Company prior to the Participant’s death or, if no
designated beneficiary survives the Participant, such payment shall be made to the Participant’s
estate.

     9. No Obligation to Continue Employment. Neither the Plan, this Agreement, nor the
grant of the Restricted Stock Units imposes any obligation on the Company or its Subsidiaries to
continue the Participant’s employment, or limit in any way the rights of the Company or a
Subsidiary to terminate the Participant’s employment at any time.

     10. No Rights as Shareholder. The Participant shall have no rights as a stockholder
with respect to any Shares subject to the Restricted Stock Units until such Shares have been
issued.

     11. Adjustment for Capital Changes. The Plan contains provisions covering the
treatment of options in the event of mergers, stock splits, spin-offs and certain other corporate
transactions. Provisions in the Plan for such adjustment are hereby made applicable hereunder and
are incorporated herein by reference.

     12. Change in Control; Corporate Transaction. Provisions regarding a Change in
Control and a Corporate Transaction are set forth on Appendix A.

     13. Withholding. Prior to the issuance of Shares in payment of the Restricted Stock
Units credited to the Account the Participant must pay to the Company, or make satisfactory
provision to the Company for payment of, any federal, state or local withholding taxes required by
law to be withheld in respect of the payment of such Restricted Stock Units. The Participant
agrees that the Company may withhold such taxes from the Participant’s wages or other remuneration.
In the discretion of the Company, the taxes may be withheld in kind from the Shares otherwise
deliverable to the Participant on payment of the Restricted Stock Units credited to the Account.

     14. Policy on the Avoidance of Insider Trading. The Participant acknowledges that
he/she has received and read the RealNetworks Policy on the Avoidance of Insider Trading, and, if
applicable, the Addendum to the Policy on the Avoidance of Insider Trading, and the Participant
agrees to comply with the Policy’s terms, together with the Addendum, if applicable.

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     15. 10b5-1 Trading Plan. Participant acknowledges that he or she is responsible for
paying any applicable taxes required by law to be withheld in respect of the issuance of the Shares
upon vesting of the Restricted Stock Units even if the Participant does not sell any Shares
issuable upon the vesting of the Restricted Stock Units. Because Participant may be prevented from
selling Shares pursuant to the Company’s Policy on the Avoidance of Insider Trading (the “Policy”) at the time of the
vesting of the Restricted Stock Units, Participant should consider entering into a 10b5-1 trading
plan that ensures the Participant will be permitted to sell Shares sufficient to cover his or her
tax liability even if the trading window is closed or the Participant would otherwise be prohibited
from selling Shares under the terms of the Policy. The Participant acknowledges that the Company
will not release Shares to the Participant until the applicable taxes required by law to be
withheld upon vesting of the Restricted Stock Units have been paid in full. The Company will not
be responsible for any losses or damages resulting from any delay in releasing the Shares to the
Participant upon the vesting of the Restricted Stock Units as a result of the Participant’s failure
to make full payment of the required taxes in a timely manner upon the vesting of the Restricted
Stock Units.

     16. Compliance with Section 409A of the Code.

          (a) Automatic Delay of Payment. Notwithstanding anything contained in this Agreement
to the contrary, if the Company determines that as of the date of payment the Participant is a
“specified employee” (as such term is defined under Section 409A of the Code), any Shares (or
shares of the common stock of the successor company in the event of a Change in Control) payable by
reason of the Participant’s termination of employment with the Company and its Subsidiaries for any
reason other than death or “disability” (as such term is defined under Section 409A of the Code)
will not be paid until the date that is six months following the date of termination of employment
(or such earlier time permitted under Section 409A of the Code without the imposition of any
accelerated or additional taxes under Section 409A of the Code).

          (b) General. This Agreement is intended to comply and shall be administered in a
manner that is intended to comply with section 409A of the Code and shall be construed and
interpreted in accordance with such intent. Payment under this Agreement shall be made in a manner
that will comply with section 409A of the Code, including regulations or other guidance issued with
respect thereto, as determined by the Committee. Any provision of this Agreement that would cause
the payment or settlement thereof to fail to satisfy section 409A of the Code shall be amended to
comply with section 409A of the Code on a timely basis, which may be made on a retroactive basis,
in accordance with regulations and other guidance issued under section 409A of the Code.

     17. Miscellaneous.

          (a) Notices. All notices hereunder shall be in writing and shall be deemed given when
sent by certified or registered mail, postage prepaid, return receipt requested, if to the
Participant, to the address indicated on the signature page below or at the most recent address
shown on the records of the Company, and if to the Company, to the Company’s principal office,
attention of the Corporate Secretary.

          (b) Entire Agreement; Modification. This Agreement and the Plan constitute the entire
agreement between the parties relative to the subject matter hereof, and supersedes all
understandings between the parties relating to the subject matter of this Agreement. This
Agreement may be modified, amended or rescinded only by a written agreement executed by both
parties.

          (c) Cost of Litigation. In any action at law or in equity to enforce any of the
provisions or rights under this Agreement, the unsuccessful party to such litigation, as determined
by the court in a final judgment or decree, shall pay the successful party or parties all costs,
expenses and reasonable attorneys’ fees incurred by the successful party or parties (including
without limitation costs, expenses and fees in any appellate proceedings), and if the successful
party recovers judgment in any such action or proceeding, such costs, expenses and attorney’s fees
shall be included as part of the judgment.

          (d) Severability. The invalidity, illegality or unenforceability of any provision of
this Agreement shall in no way affect the validity, legality or enforceability of any other
provision.

          (e) Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns, including the
Participant’s heirs, executors, administrators and legal representatives.

          (f) Governing Law. This Agreement shall be governed by and interpreted in accordance
with the laws of the State of Washington, without giving effect to the principles of the conflicts
of laws thereof.

3

 

APPENDIX A

Change in Control; Corporate Transaction

I. Change in Control

     Notwithstanding anything contained herein to the contrary, if (i) the Restricted Stock Units
credited to the Account are assumed or substituted for on substantially the same terms and
conditions (which may include payment in shares of the common stock of the Surviving Corporation or
the Parent Corporation) immediately following the Change in Control and (ii) within twenty-four
(24) months after a Change in Control the Participant’s employment is terminated by the Company or
its successor without Cause or by the Participant for Good Reason, all of the Shares subject to the
Option shall be vested immediately. Furthermore and notwithstanding anything contained herein to
the contrary, if the Restricted Stock Units credited to the Account are not assumed or substituted
for immediately following the Change in Control on substantially the same terms and conditions
(which may include payment in shares of the common stock of the Surviving Corporation or the Parent
Corporation), all of the Shares subject to the Restricted Stock Units credited to the Account shall
vest immediately upon the Change in Control. If the Company is the Surviving Corporation or the
Parent Corporation, if applicable, it shall be deemed to have assumed the Restricted Stock Units
unless it takes explicit action to the contrary.

     For purposes of this Agreement:

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

          (i) during any period of twenty-four (24) consecutive months, individuals who, at the
beginning of the period constitute the Board (the “Incumbent Directors”) cease for any reason to
constitute at least a majority of the Board, provided that any person becoming a director
subsequent to the initial public offering whose election or nomination for election was approved by
a vote of at least a majority of the Incumbent Directors then on the Board (either by a specific
vote or by approval of the proxy statement of the Company in which such person is named as a
nominee for director, without written objection to such nomination) shall be an Incumbent Director;
provided, however, that no individual initially elected or nominated as a director
of the Company as a result of an actual or threatened election contest with respect to directors or
as a result of any other actual or threatened solicitation of proxies by or on behalf of any person
other than the Board shall be deemed to be an Incumbent Director;

          (ii) any “person” (as such term is defined in the Exchange Act and as used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing
35% or more of the combined voting power of the Company’s then outstanding securities eligible to
vote for the election of the Board (the “Company Voting Securities”); provided,
however, that the event described in this paragraph (ii) shall not be deemed to be a Change
in Control by virtue of any of the following acquisitions: (A) by the Company or any subsidiary,
(B) by any employee benefit plan (or related trust) sponsored or maintained by the Company or any
subsidiary, (C) by any underwriter temporarily holding securities pursuant to an offering of such
securities, (D) pursuant to a Non-Qualifying Transaction, as defined in paragraph (iii), or (E) by
any person of Voting Securities from the Company, if a majority of the Incumbent Board approves in
advance the acquisition of beneficial ownership of 35% or more of Company Voting Securities by such
person;

          (iii) the consummation of a merger, consolidation, statutory share exchange, reorganization or
similar form of corporate transaction involving the Company or any of its subsidiaries that
requires the approval of the Company’s stockholders, whether for such transaction or the issuance
of securities in the transaction (a “Business Combination”), unless immediately following such
Business Combination: (A) more than 50% of the total voting power of (x) the corporation resulting
from such Business Combination (the “Surviving Corporation”), or (y) if applicable, the ultimate
parent corporation that directly or indirectly has beneficial ownership of 100% of the voting
securities eligible to elect directors of the Surviving Corporation (the “Parent Corporation”), is
represented by Company Voting Securities that were outstanding immediately prior to such Business
Combination (or, if applicable, is represented by shares into which such Company Voting Securities
were converted pursuant to such Business Combination), and such voting power among the holders
thereof is in substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business Combination, (B) no person
(other than any employee benefit plan (or related trust) sponsored or maintained by the Surviving
Corporation or the Parent Corporation), is or becomes the beneficial owner, directly or indirectly,
of 35% or more of the total voting power of the outstanding voting securities eligible to elect
directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving
Corporation) and (C) at least half of the members of the board of directors of the Parent
Corporation (or, if there is no Parent Corporation, the Surviving Corporation) following the
consummation of the Business Combination were Incumbent Directors at the time of the Board’s
approval of the execution of the initial agreement providing for such Business Combination (any
Business Combination which satisfies all of the criteria specified in (A), (B) and (C) above shall
be deemed to be a “Non-Qualifying Transaction”); or

4

 

          (iv) the shareholders of the Company approve a plan of complete liquidation or dissolution of
the Company or the consummation of a sale of all or substantially all of the Company’s assets.

     Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because
any person acquires beneficial ownership of more than 35% of the Company Voting Securities as a
result of the acquisition of Company Voting Securities by the Company which reduces the number of
Company Voting Securities outstanding; provided, that if after such acquisition by
the Company such person becomes the beneficial owner of additional Company Voting Securities that
increases the percentage of outstanding Company Voting Securities beneficially owned by such
person, a Change in Control of the Company shall then occur.

          “Good Reason” means:

          (i) a reduction by the Company or its successor of more than 10% in the Participant’s rate of
annual base salary as in effect immediately prior to such Change in Control;

          (ii) a reduction by the Company or its successor of more than 10% of the Participant’s
individual annual target or bonus opportunity; or

          (iii) any requirement of the Company that Participant be based anywhere more than fifty (50)
miles from Participant’s primary office location at the time of the Change in Control and more than
fifty (50) miles from Participant’s principal residence at the time of the Change in Control.

II. Corporate Transaction

     Notwithstanding anything contained herein to the contrary, in the event of a Corporate
Transaction that is not a Change in Control, the surviving corporation or acquiring corporation may
assume, continue or substitute for the Restricted Stock Units credited to the Account on
substantially the same terms and conditions (which may include payment in shares of the common
stock of the surviving corporation or acquiring corporation, or the parent company of the surviving
or acquiring corporation). In the event of a Corporate Transaction that is not a Change in
Control, then notwithstanding anything contained herein to the contrary, to the extent that the
surviving corporation or acquiring corporation (or its parent company) does not assume, continue or
substitute for the Restricted Stock Units credited to the Account on substantially the same terms
and conditions (which may include payment in shares of the common stock of the surviving
corporation, acquiring corporation, or the surviving or acquiring corporation’s parent company),
then all of such Restricted Stock Units shall become fully vested immediately prior to the
Corporate Transaction if the Participant is then an Employee.

     For purposes of this Agreement, “Corporate Transaction” means (i) the consummation of a
merger, consolidation or similar transaction following which the Company is not the surviving
corporation; or (ii) the consummation of a merger, consolidation or similar transaction following
which the Company is the surviving corporation but the Shares outstanding immediately preceding the
merger, consolidation or similar transaction are converted or exchanged by virtue of the merger,
consolidation or similar transaction into other property, whether in the form of securities, cash
or otherwise. Notwithstanding the foregoing, a “Corporate Transaction” shall not include a
transaction that is effected exclusively for the purpose of changing the domicile of the Company.

III. Form and Timing of Payment

     Payment
of Restricted Stock Units that vest pursuant to the first sentence of Part I of this
Appendix A shall be made in Shares (or, if applicable, in shares of the common stock of the
Surviving Corporation or Parent Corporation) as soon as practicable following the termination of
employment referred to in such sentence. Payment of Restricted Stock Units that vest pursuant to
the second sentence of Part I of Appendix A shall be made in Shares (or, if applicable, in shares
of the common stock of the Surviving Corporation or the Parent Corporation), as soon as practicable
following the earliest of (i) the date of the Change in Control if such Change in Control is also a
Section 409A CIC (as defined in Appendix B), (ii) the applicable date on which the Restricted Stock
Units vest or (iii) the date of the Participant’s termination of employment with the Company and
its Subsidiaries for any reason. Payment of Restricted Stock Units that vest pursuant to the
second sentence of Part II of this Appendix A shall be made in Shares (or, if applicable, in shares
of the common stock of the surviving corporation, acquiring corporation, or the surviving or
acquiring corporation’s parent company), as soon as practicable following the earliest of (i) the
date of the Corporate Transaction if such Corporate Transaction is also a Section 409A CIC, (ii)
the applicable on which the Restricted Stock Units vest or (iii) the date of the Participant’s
termination of employment with the Company and its Subsidiaries for any reason.

5

 

APPENDIX B

     For purposes of this Agreement, “Section 409A CIC” means and shall be deemed to have occurred
as of the date of the first to occur of the following events:

          (a) Any Person or Group acquires stock of the Company that, together with stock held by such
Person or Group, constitutes more than 50% of the total fair market value or total voting power of
the stock of the Company. However, if any Person or Group is considered to own more than 50% of
the total fair market value or total voting power of the stock of the Company, the acquisition of
additional stock by the same Person or Group is not considered to cause a Section 409A CIC. An
increase in the percentage of stock owned by any Person or Group as a result of a transaction in
which the Company acquires its stock in exchange for property will be treated as an acquisition of
stock for purposes of this subsection. This subsection applies only when there is a transfer of
stock of the Company (or issuance of stock of the Company) and stock in the Company remains
outstanding after the transaction;

          (b) Any Person or Group acquires (or has acquired during the 12-month period ending on the
date of the most recent acquisition by such Person or Group) ownership of stock of the Company
possessing 35% or more of the total voting power of the stock of the Company. However, if any
Person or Group is considered to own 35% of the total voting power of the stock of the Company, the
acquisition of additional stock by the same Person or Group is not considered to cause a Section
409A CIC;

          (c) A majority of members of the Company’s Board is replaced during any 12-month period by
Participants whose appointment or election is not endorsed by a majority of the members of the
Company’s Board prior to the date of the appointment or election; or

          (d) Any Person or Group acquires (or has acquired during the 12-month period ending on the
date of the most recent acquisition by such Person or Group) assets from the Company that have a
total gross fair market value equal to or more than 40% of the total gross fair market value of all
of the assets of the Company immediately prior to such acquisition or acquisitions. For this
purpose, gross fair market value means the value of the assets of the Company, or the value of the
assets being disposed of, determined without regard to any liabilities associated with such assets.
However, no Section 409A CIC shall be deemed to occur under this subsection (d) as a result of a
transfer to:

               (i) A shareholder of the Company (immediately before the asset transfer) in exchange for or
with respect to its stock;

               (ii) An entity, 50% or more of the total value or voting power of which is owned, directly or
indirectly, by the Company;

               (iii) A Person or Group that owns, directly or indirectly, 50% or more of the total value or
voting power of all the outstanding stock of the Company; or

               (iv) An entity, at least 50% of the total value or voting power of which is owned, directly or
indirectly, by a person described in clause (iii) above.

     For these purposes, the term “Person” shall mean an individual, Company, association, joint
stock company, business trust or other similar organization, partnership, limited liability
company, joint venture, trust, unincorporated organization or government or agency, instrumentality
or political subdivision thereof. The term “Group” shall
have the meaning set forth in Rule 13d-5
of the Securities Exchange Commission, modified to the extent necessary to comply with Proposed
Treasury Regulation Section 1.409A-3(g)(5)(v)(B), or any successor thereto in effect at the time a
determination of whether a Section 409A CIC has occurred is being made.

6

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