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                                                                                                          Exhibit 10.7

                                                   LICENSE AGREEMENT
                                                 BEVMAX OFFICE CENTERS
                                    1560 Broadway, 10th Floor. New York, N.Y. 10036

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License #                OO41                                                    Date    1/23/2004
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Licensee:                              On2 Technologies, Inc.
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(please indicate above if corporation, partnership, etc.)
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Principal's Name:                      Tim Reusing
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Contact Person's Name:                 Tim Reusing
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Federal ID #                           841280679
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BOC Telephone #                        (646) 292-3533
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Type of Business:                      Software Development
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Licensed Office(s):                    1031, 1032, 1033, 1034 & 1041
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Fixed Fee/Additional Fees:             $8,240.00 Fixed Fee per month / $565.00 Additional Fees per month for
                                       5 phones, 5 T-1 & 1 fax
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Commencement Fee:                      $0.00

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Service Retainer:                      $16,480.00 (Received $15,600.00 pursuant to License Agreement #0004 for
                                       offices 1024, 1025, 1026 & 1027)
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Term:                                  1 Year
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             A) Commencement Date:                     Feb.12, 2004
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             B) Termination Date:                      Feb.11, 2005
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Person's Authorized to Sign for Licensee:                            Tim Reusing
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Licensor:                              Bevmax Office Centers 1560, LLC d/b/a Bevmax Office Centers
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This License Agreement made as of 1/23/04 between Bevmax Office Centers 1560,
LLC d/b/a Bevmax Office Centers (hereinafter "Licensor") and On2 Technologies,
Inc. (hereinafter "Licensee") incorporates page 2 of this License Agreement
(attached hereto) and we both agree to comply with all terms and conditions as
delineated on this page and page 2 of this License Agreement.

Licensee:    On2 Technologies, Inc.                                  Licensor:   Bevmax Office Centers 1560, LLC
                                                                                 d/b/a Bevmax Office Centers
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By:                                                                  By:
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             Authorized Signature / Date                                         Authorized Signature / Date
             Tim Reusing                                                         Fredric Feld
             ------------------------------------------                          ------------------------------------
             Print Name                                                          Print Name
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                           License Agreement (Page 2)

1.       Standard  Services:  In consideration  of the Licensees  payment of the
         Fixed Fee and the  Commencement  Fee (both listed on front page of this
         License Agreement) as well as other valuable consideration,  1)Licensor
         allows  Licensee to use the office(s)  listed on the front page of this
         License  Agreement  (hereinafter  "Agreement") and cross hatched on the
         attached  floor plan 24 hours a day, 7 days a week for the License Term
         (listed on front page) subject to the Rules and Regulations,  a copy of
         which Licensee  acknowledges  was received with this Agreement,  (which
         Rules and Regulations  may be reasonably  changed by Licensor from time
         to time upon  written  notice to  Licensee)  and subject to  Licensor's
         right upon 3 days written notice to Licensee to relocate  Licensee to a
         different  office within the Center of at least equal size and quality,
         2)Licensor  provides Licensee with Receptionist  during normal business
         hours,  3)6  hours a month  use of a  conference  room (as  available),
         4)delivery of mail, 5)use of common areas including pantry,  6)Licensor
         also  provides  heating,   HVAC,   electricity   (subject  to  building
         limitations),  7)office  cleaning,  8)maintenance of Licensor equipment
         and  offices  due to  ordinary  wear and  tear,  9)  Licensor  provides
         Licensee  access to a shower and agrees to install a hot water  heater;
         and  10)  Licensor   provides  Licensee  access  to  an  exercise  room
         containing commercial-quality gym equipment, provided that (i) Licensee
         and each of  Licensee's  employees who intends to use the exercise room
         executes  a  waiver  of  liability  in form  reasonably  acceptable  to
         Licensor  with  respect  to the  use of such  exercise  room  and  (ii)
         Licensee  agrees to indemnify  Licensor  any claim  brought by any such
         employee of Licensee in connection with the use of such exercise room.

2.       Fees:  The Fixed Fee is  payable  in  advance  on the first day of each
         month during the License Term. (In the event the License Term begins on
         a day other  than the 1st day of a month,  the  second  payment  of the
         Fixed Fee will be apportioned on a daily basis).  The  Commencement Fee
         and Service Retainer  (defined in paragraph 3) are also to be paid upon
         the  signing  of  this   Agreement.   Additional  Fees  (including  all
         applicable  taxes) are due on the 15th day of the month  following  the
         month for which the additional  services  (defined in paragraph 4) were
         provided and invoiced.

3.       Service  Retainer:  The  Service  Retainer is to be held by Licensor as
         security for payment of all fees due and payable  under this  Agreement
         as well as all damages to Licensor's  equipment and furniture or office
         space  caused  by  Licensee  or its  invitees,  ordinary  wear and tear
         excepted and all and any  obligations of Licensee under this Agreement.
         The  Service  Retainer  will not be kept in a separate  account  and no
         interest will be paid to Licensee.  The Service Retainer may be applied
         upon prior  written  notice to  Licensee  to all past due fees,  monies
         and/or  damages  as they  occur,  at our  reasonable  discretion.  This
         Service  Retainer  will be  returned  (less any  monies  due under this
         Agreement)  30 days after the  expiration  of the License  Term or upon
         early  termination  as defined in paragraph 6. In the event the Service
         Retainer is applied to past due fees, then the Licensee is obligated to
         replenish the Service  Retainer to the original amount set on page 1 of
         this Agreement promptly upon written request.

4.       Additional Services:  Additional Services are services above and beyond
         Standard Services as defined in paragraph 1 which are available at both
         Licensee's and  Licensor's  option  pursuant to our rate schedule.  The
         Additional Fees for these Additional Services shall be paid by Licensee
         pursuant to paragraph 2.

5.       a)  Liability: Licensor and Bevmax  Properties,  LLC are not liable for
             any loss or damages as a direct or  indirect  result of  Licensor's
             misfeasance or nonfeasance in connection with providing any service
             including  but not  limited to  telephone  usage,  internet  usage,
             electricity, and all utilities and building services as well as all
             Additional  Services.  Licensees  sole remedy for  interruption  or
             failure  of any  service,  utility  or actual  access to the office
             center or their assigned  office is the suspension or adjustment of
             the Fixed Fee or  Additional  Fees as is  applicable.  Licensee may
             effect such suspension or adjustment of the Fixed Fee or Additional
             Fees upon prior written notice to Licensor.

         b)  Condition Precedent: As a specific condition precedent to the
             Licensor entering into this License Agreement, The Licensee
             unequivocally and absolutely agrees not to make any claim for
             damages including but not limited to loss of profits or gross
             income

         which are directly or indirectly a result of Licensor's action or
         inaction, misfeasance or nonfeasance unless said damages are a direct
         result of Licensor's gross negligence and then such damages are to be
         limited to suspension, adjustment of Fees as outlined in paragraph
         5(a).

6.       a)  Licensor   Termination:  Licensor  may  terminate   this  Agreement
             before the end of the License Term in the event that  Licensee does
             not  perform  or  comply  with,  or  violates  any  of  the  terms,
             conditions, paragraphs of this Agreement, including but not limited
             to payment of any fees, monies,  and/or violations of the Rules and
             Regulations (hereinafter  "Default"),  and the Default is not cured
             within 5 business days after written notice of such Default is hand
             delivered to Licensee.  Notwithstanding the foregoing, Licensor may
             terminate this Agreement immediately after Licensee has committed 3
             separate  Defaults of this  Agreement,  and Licensor has previously
             provided  Licensee  with  prior  written  notice  of such  default.
             Licensee  agrees  not to  terminate  this  Agreement  willfully  or
             capriciously and to enforce the Rules and Regulations  consistently
             with respect to all licensees.

         b)  Licensee  Termination:  Licensee  can  terminate this  Agreement In
             either of the following events,  1)there is no access to the office
             center   for   6   concurrent   business   days,   2)there   is  no
             telecommunication   service,   phone  or  internet  service  for  4
             concurrent  business days upon hand  delivering  written  notice of
             termination   of   Agreement   indicating   lack   of   access   or
             telecommunication  service and  Licensor's not curing same within 2
             business  days, or  3)Licensee  can  demonstrate  that Licensor has
             consistently  failed to provide  internet  service at  commercially
             reasonable levels.

7.       Insurance:  Licensee  is to  provide  Licensor  with a  certificate  of
         insurance  covering  all of  Licensee's  personal  property  as well as
         liability insurance covering its own employees and third parties naming
         Bevmax Office  Centers/Licensor as additional insured.  Licensor is not
         responsible  for  loss,  damage  or  theft of any of  Licensee,  or its
         employees,   invitees,   guests,  vendors,  and/or  visitor's  personal
         property  unless  the  loss  theft or  damage  is a  direct  result  of
         Licensor's gross negligence.

8.       Damages:  Licensee is to take good commercially  reasonable care of all
         of the furnishings,  equipment,  personal property of the Office Center
         as well as the  installation of the Office Center (e.g.  carpet,  light
         fixtures,  wallcoverings,   pictures,  sheetrock  walls).  All  damages
         resulting from Licensee or its invitees,  guests, vendors, and visitors
         actions will be added to the Additional Fees invoice.

9.       Internet Service: Licensee is limited to 200 MB per paid connection per
         day. Licensor  reserves the right to terminate  internet service to the
         Licensee upon 2 business days written notice when,

         a)  Licensee is either using a disproportionate amount of bandwidth, or

         b)  Other licensee's use of internet is negatively effected in any way,
             or

         c)  there is a negative  impact  on the  Bevmax Office Centers network.
             In the event Licensor  terminates the Licensee's  internet service,
             Licensee has the right to terminate  this License  Agreement upon 3
             days written notice.

10.      Miscellaneous:

         a). Licensee  may not  assign  this  agreement without Licensor's prior
             written consent.

         b). Licensor agrees to forward all mail to Licensee for a period of  30
             days.

         c). All  notices are  to be in writing by Federal Express, Certified or
             Registered  Mail or any other delivery  service  providing proof of
             delivery to either Licensor or Licensee at their  addresses  listed
             on page 1 of this agreement.

         d). Licensee agrees to abide by, comply with and not violate the  Rules
             and  Regulations  of  Bevmax  Office  Centers,  a copy of which was
             delivered to Licensee before the signing of this License Agreement.

         e).  Licensor & Licensee  agree to waive  their  respective rights to a
             Jury Trial.

         f). This   Agreement  is   specifically   subject  to  all  the  terms,
             conditions, and paragraphs of Licensor's Lease of the 10th floor of
             1560 Broadway dated February 13, 2003.