EXHIBIT 10.26

June 19,
2001

James
Schmidt
CTO
HearMe

Dear
Jim,

You
are among a select group of executives who we believe are crucial to HearMe's transition over the next six months based on your relationships with customers, vendors and employees. The
Compensation Committee of the Board of Directors has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of HearMe's executive team,
including yourself, to their assigned duties without distraction in the face of potentially disruptive circumstances arising from the possibility of a change in control of the Company and/or the
Company's dissolution.

If
you remain employed with the Company and devote your full attention and time, during normal business hours, to the business and affairs of the Company, and use your best efforts to perform
faithfully and efficiently such responsibilities for the next several months, the Company will do the following.



The
retention bonus, options, and the extension of your exercise period are based on the premise that you stay with HearMe and perform at or above the expectation level in your position.

This
letter does not change the at-will nature of your employment relationship with HearMe. The specifics of the terms and conditions under which the benefits described above are being
offered to you are described in more detail in the attached Exhibit A: HearMe, Change of Control/Retention Agreement. Please read and sign this Agreement.

Thank
you for your continued support and hard work.

Sincerely,

Rob
Csongor
Chief Executive Officer

Acknowledge receipt by signing below and returning original to John Alexander.

|Signature: |  |               |  | Date: |  | 
|---------- |  | ------------- |  | ----- |  | 
|Name:      |  | James Schmidt |  |       |  | 

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EXHIBIT A  HEARME

CHANGE OF CONTROL / RETENTION AGREEMENT

This Change of Control / Retention Agreement (the "Agreement") is made and entered into by and between Jim Schmidt (the "Employee") and HearMe (the "Company"),
effective as of the latest date set forth by the signatures of the parties hereto below (the "Effective Date").

RECITALS

A.  It
is expected that the Company from time to time will consider the possibility of an acquisition by another company or other change of control. Additionally, a
number of activities will be required of the Employee that are outside the normal scope of his or her responsibility in the event that the Company elects to dissolve. The Board of Directors of the
Company (the "Board") recognizes that such considerations can be a distraction to the Employee and can cause the Employee to consider alternative employment opportunities. The Board has determined
that it is in the best interests of the Company and its stockholders and creditors to assure that the Company will have the continued dedication and objectivity of the Employee, notwithstanding the
possibility, threat or occurrence of a Change of Control (as defined below) of the Company and notwithstanding any increased duties required of him or her in the future.

B.  The
Board believes that it is in the best interests of the Company, its stockholders and its creditors to provide the Employee with an incentive to continue his/her
employment and to motivate the Employee to maximize the value of the Company, for the benefit of its stockholders and/or creditors, despite the possibility of a Change of Control and/or dissolution.

C.  The
Board believes that it is necessary and appropriate to provide the Employee with certain benefits in order to provide the Employee with incentives and
encouragement to remain with the Company notwithstanding the possibility of a Change of Control and/or dissolution.

D.  Certain
capitalized terms used in the Agreement are defined in Section 7 below.

The
parties hereto agree as follows:

1.Term of Agreement.This Agreement shall terminate on the date that all obligations of the parties
hereto with respect to this Agreement have been satisfied.

2.At-Will Employment.The Company and the Employee acknowledge that the Employee's
employment is and shall continue to be at-will, as defined under applicable law. If the Employee's employment terminates for any reason, whether with or without Cause and with or without
notice, the Employee shall not be entitled to any payments, benefits, damages, awards or compensation other than as provided by this Agreement, or as may otherwise be available in accordance with the
Company's established employee plans or pursuant to other written agreements with the Company.

3.Retention Bonus.In order to incent the Employee to remain employed with the Company for the next
several months and provide added stockholder and creditor value during this difficult and uncertain business climate, Employee will be eligible to receive a cash bonus of $150,000, less applicable tax
withholdings. To earn this retention bonus you, the Employee must remain an employee in good standing through November 30, 2001. This means that the Company shall not have terminated the
Employee's employment for Cause (including a deemed termination under the definition below) prior to November 30, 2001. This retention bonus will be paid on November 30th, or earlier as
follows: (a) in the event the Company undergoes a Change of Control that closes prior to November 30, 2001, on the closing date of the transaction, or (b) in the event the Company
terminates the Employee's employment without Cause prior to November 30, 2001, on the last day of his or her employment. If

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the Employee's employment terminates prior to November 30, 2001 for any reason other than as a result of the Company's terminating his or her employment for Cause, the Employee shall not be
entitled to payment of any portion of the retention bonus.

4.Option Grant.In order to incent the Employee to continue to build shareholder value and remain
employed with the Company for the next several months and provide added stockholder and creditor value during this difficult and uncertain business climate, the Company has granted the Employee an
option (the "Option") to purchase 100,000 shares of Common Stock of the Company with an exercise price of $0.40 per share. The Option was granted on April 23, 2001, is a nonstatutory stock
option under applicable tax law, has a term of ten (10) years, and is subject to the terms and conditions of the Company's 1999 Stock Incentive Plan and a standard stock option agreement. The
Option will vest in full (meaning that the Employee will be able to exercise and retain all (100%) of shares underlying the
Option) on the earlier date of the closing date of a Change of Control of the Company, February 28, 2002, or the date Employee is terminated by the Company without Cause.

5.Extension of Exercise Period.As further incentive for the Employee's continuing employment, the
Company will grant an extension of the period in which he or she has to exercise all vested (as of the date the Employee's employment terminates) options held by him or her from the 90 days
provided for in the applicable option agreements to one year following the termination of employment. The extension of the option exercise period shall be extended if the Employee remains employed
until the earlier to occur of (a) November 30, 2001, (b) the closing date of the Company, or (c) the date the Company terminates the Employee's employment without Cause.
Except as provided in the prior sentence, this extension shall not be available in the event the Employee's employment terminates prior to November 30, 2001 for any reason other than a
termination without Cause by the Company.

6.Other Terminations.Other than as specified above in this Agreement, the Employee shall not be
entitled to any benefits or payments in connection with termination of his or her employment with the Company (other than those benefits to which he or she is entitled under
then-applicable Company policies or applicable law). If the Employee's employment is terminated for Cause (including a deemed termination under the definition below), he or she shall not
be entitled to any benefits provided for under this Agreement. In the event of the Employee's death or termination of his or her employment as a result of a Disability, in either case occurring before
the date on which this Agreement provides that a benefit is to be provided, then the Employee (or his or her heirs) shall be entitled to any such benefit.

7.Definition of Terms.The following terms referred to in this Agreement shall have the following
meanings:



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8.Successors.



9.Miscellaneous Provisions.



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IN
WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by its duly authorized officer, as of the day and year set forth below.

| |  | HEARME        |  |                        
| |  | ------------- |  | -----------------------
| |  | By:           |  |                        
| |  | Title:        |  | Chief Executive Officer
| |  | Date:         |  |                        
| |  | James Schmidt |  |                        
| |  | Date:         |  |                        

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