Employment Agreement - RealNetworks Inc. and Phil Murphy
July 12, 2000
Phil Murphy
Dear Phil:
As you know, I am extremely pleased to offer you employment at RealNetworks,
Inc. ("RN") as Senior Vice President, International, currently reporting to Rob
Glaser, CEO. Your position will initially be based in London, though RN reserves
the right to re-evaluate where the position shall be located in the future based
on its business needs.
Your base salary will be Pound Sterling149,000 per annum, payable monthly in
arrears. It is the intent of RN to protect you against double taxation of your
salary (not including the holding or exercise of stock options or stock sales),
if this becomes relative due to your service time in the US and UK.
You are eligible to earn an annual bonus up to Pound Sterling100,000, based on
achieving target goals consistent with the business plan, of which 50% is
guaranteed at Pound Sterling50,000.
You will also earn an initial signing bonus of Pound Sterling50,000, which is
considered taxable income. This one time bonus will be refunded to RN should you
choose to leave RN's employment voluntarily within your first year.
A car allowance of Pound Sterling20,000 will also be provided, and will be open
to further evaluation within reason. All monetary compensation will be subject
to applicable statutory deductions.
You will be eligible for participation in RN's applicable benefit programs (5%
non-contributory pension scheme, life insurance, private medical and long-term
sickness, etc.). Full details will be provided after you have commenced
employment or upon your request. RN must also reserve the right to alter, amend
or discontinue any of these benefit programs.
You will also earn equity in RN under the terms of the RealNetworks 1996 Stock
Option Plan. You will receive options on 110,000 shares of RN Common Stock,
subject to the vesting and all other provisions contained in the Stock Option
Plan.
Your stock options will be granted on the last NASDAQ stock exchange trading day
("Grant Date") of the calendar week in which the first day of your employment
occurs. The exercise price of the stock options shall be equal to the fair
market value of RN's Common Stock on the Grant Date. Fair market value shall
equal the last sales price for shares of RN's Common Stock on the Grant Date as
reported by the NASDAQ National Market. Please be aware that unvested stock
options are forfeited upon termination of employment.
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You are entitled to be compensated for bank or public holidays. In addition, you
will be entitled to 23 days paid holiday. This accrues pro rata over the holiday
year, 1 January to 31 December. No holiday may be carried forward without prior
written permission from your manager. You will not be paid cash in lieu of
holiday entitlement not taken. Entitlements in the years you commence and end
employment will be calculated on pro rata based on full, completed months
worked. In the event you leave employment having taken either less or more than
your entitlement, you hereby grant RN the right to make an appropriate addition
to, or deduction from, salary or other sums due you upon termination.
RN respects the confidentiality of third party information and intellectual
property. You agree not to disclose to RN or induce RN to use any confidential
information or trade secrets belonging to any third party. You represent that
the execution of this Agreement, your employment with RN, and the performance of
your proposed duties to RN will not violate any agreements or obligations you
may have to any former employer or third party. You agree to disclose prior to
your employment with RN the name of any other entity with whom you are employed,
or for whom you are an independent contractor.
You also agree that during your employment with RN you will not engage in any
business activity competitive with RN's business activities.
Our employment relationship may be terminable at will, meaning that either you
or RN may terminate your employment at any time and for any reason or no reason,
with the exception of any special allowances herein. If RN terminates you for no
cause prior to the end of your first full year of employment, you will be paid
an amount equal to the greater of 50% of, or the remainder of, your first year's
annual base salary. If you are terminated for no cause after your first year of
employment, RN will pay an amount equal to 50% of your base salary. In addition,
you agree that you will provide RN six months notice prior to you terminating
your employment.
This offer is contingent on you signing the RealNetworks Employee Development
and Confidentiality Agreement and Non-Compete Agreements attached hereto.
Your start date is to be July 20, 2000.
Phil, we are very excited about the prospect of your joining RN and look forward
to you sharing in the tremendous opportunity to help us realize our full
potential and exciting growth plans.
Please sign and return to me one copy of this offer letter signifying your
acceptance.
Yours sincerely,
/s/ Rob Glaser
Rob Glaser
CEO
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I have read and agree to the terms of employment contained in this offer letter
and the attached Development, Confidentiality and Non-competition Agreement,
which represent a full, complete and fair statement of the offer of employment
made to me by RN.
Phil Murphy:
/s/ Phil Murphy
Date: July 19, 2000 Start Date: July 20, 2000