Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Approval of 2021 Executive MBO Plan
On August 20, 2021, the Compensation Committee of the Board of Directors of
RealNetworks, Inc. (the "Company") approved the 2021 Executive MBO Plan. The
Compensation Committee will administer this plan, which is pursuant to the
RealNetworks 2005 Stock Incentive Plan, as amended and restated.
Payouts under the 2021 Executive MBO Plan will be determined by our Compensation
Committee and will be based on company and/or divisional financial performance
and individual performance. Financial performance will be measured by the
achievement of specific financial goals related to revenue and contribution
margin by reportable segment. Contribution margin by reportable segment is a
non-GAAP measure that we define as operating income (loss) including other
income (expense) net, but excluding the impact of the following: depreciation
and amortization, acquisitions related intangible asset amortization,
stock-based compensation, restructuring and other charges, and lease exit and
related charges. Individual performance will be measured based on specified
individual strategic and commercial business objectives.
Any bonuses payable pursuant to the 2021 Executive Bonus Plan will be paid in
cash or in the form of fully vested restricted stock units, or a combination
thereof.
Approval of Discretionary Cash Bonuses
On August 20, 2021, the Compensation Committee of the Board of Directors of the
Company approved the payment of discretionary bonuses, each in the amount of
$50,000, to Michael Ensing, the Company's President and Chief Operating Officer,
Christine Chambers, the Company's Chief Financial Officer and Michael Parham,
the Company's Senior Vice President, General Counsel and Corporate Secretary in
recognition of their individual contributions throughout the year to the Company
and, in particular, to the Company's underwritten public offering that closed on
April 29, 2021.
Approval of Change in Executive Compensation Arrangements
On August 20, 2021, the Compensation Committee of the Board of Directors of the
Company approved certain new compensatory arrangements for two of the Company's
named executive officers, Michael Parham, the Company's Senior Vice President,
General Counsel and Corporate Secretary, and Christine Chambers, the Company's
Chief Financial Officer. Specifically, the Compensation Committee approved
(i) an increase in Mr. Parham's annual base salary from $325,000 to $350,000;
(ii) a grant to Mr. Parham of 50,000 restricted stock units ("RSUs"); and
(iii) grants to Mr. Parham and Ms. Chambers of time-based stock options to
acquire 250,000 shares and 40,000 shares, respectively, of the Company's common
stock with a per share exercise price equal to the closing price of the
Company's common stock on August 20, 2021, the grant date. Each RSU and option
shall vest over four years, at a rate of 12.5% every six months following the
grant date, subject to continued employment with the Company on each such
vesting date. The RSUs and stock options were granted pursuant to the Company's
2005 Stock Incentive Plan.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Pursuant to the rules and regulations of the SEC, the attached exhibits are
deemed to have been furnished to, but not filed with, the SEC.
Exhibit
No. Description
10.1 2021 Executive MBO Plan
104 Cover page Interactive Data File (formatted as inline XBRL)
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