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EXHIBIT 4.2    
  


EXECUTION COPY  


STANDSTILL AGREEMENT  


 entered into as of  


 January 23, 2001  


 between  


 

 LIBERATE TECHNOLOGIES,  


 DELPHI ASSET MANAGEMENT CORPORATION,  


 

 US TRUST COMPANY OF DELAWARE,

AS CO-TRUSTEE,  


 AND  


 UNITED STATES TRUST COMPANY OF NEW YORK,

AS CO-TRUSTEE  





 


 STANDSTILL AGREEMENT  


    AGREEMENT entered into as of January 23, 2001 between LIBERATE TECHNOLOGIES, a Delaware corporation (the
"Company"), DELPHI ASSET MANAGEMENT CORPORATION, a Nevada corporation ("Shareholder"), US TRUST COMPANY
OF DELAWARE, as co-trustee and UNITED STATES TRUST COMPANY OF NEW YORK, as co-trustee, (together, the "Trustee") of the Trust, a
voting trust formed pursuant to the Trust Agreement (as defined below) under the laws of the State of Delaware (the "Trust"). 


ARTICLE 1  


 DEFINITIONS  


    SECTION
1.01.  Definitions.  



    (a) The
following terms, as used herein, have the following meanings: 




    "Affiliate" means, with respect to any Person, any Person that directly or indirectly through one or more intermediaries, Controls, is
Controlled by, or is under common Control with an enterprise. 


    "Common Shares" means the common stock, $.01 par value per share, of the Company. 



    "Control" means the possession, direct or indirect, of the power to direct or cause the direction of the Management and policies of an
enterprise through ownership, by contract, or otherwise. 


    "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. 


    "Management" means the Persons who are responsible for achieving the objectives of the enterprise and who have the authority to
establish policies and make decisions by which those objectives are to be pursued. 


    "Person" means an individual, a corporation, a partnership, an association, a trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof. 


    "Restricted Securities" means any (1) Common Shares and any other securities or rights convertible into or exchangeable or
exercisable for such Common Shares and (2) any other voting securities of the Company or securities or rights convertible into exchangeable or exercisable for voting securities of the Company. 



    "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 


    "Shareholder Group" means Shareholder, the Trust and their respective Affiliates. 


    "Total Voting Power" means the aggregate number of votes which may be cast by holders of outstanding Common Shares. 


    "Trust Agreement" means the Irrevocable Trust Agreement by and among Delphi Asset Management Corporation, US Trust Company of Delaware
and United States Trust Company of New York entered into as of January 23, 2001. 


ARTICLE 2  


 COVENANTS OF SHAREHOLDER AND THE TRUST  


    SECTION
2.01.  Acquisition of Restricted Securities.  During the term of this Agreement, Shareholder
agrees that Shareholder will not, and will not permit its Affiliates to, purchase or otherwise acquire, or agree or offer to purchase or otherwise acquire, ownership of any Restricted Securities. 


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    SECTION 2.02.  Sale or Transfer of Restricted Securities.  During the term of this Agreement, each of the
Shareholder and the Trustee agrees that it will not, and will not permit its Affiliates to, sell, pledge, encumber or otherwise transfer, or agree to sell, pledge, encumber or otherwise transfer,
directly or indirectly, any Restricted Securities, except: 



    (a) to
any Person, who, after giving effect to such sale, pledge, encumbrance or transfer, would beneficially own Common Shares representing in the aggregate 10% or
less of Total Voting Power; 


    (b) pursuant
to a firm commitment, underwritten distribution to the public, registered under the Securities Act, in which the Shareholder Group uses its reasonable best
efforts to effect as wide a distribution of such Restricted Securities as is reasonably practicable; 


    (c) pursuant
to Rule 144 under the Securities Act; provided that any such sale shall be subject to the volume and
manner of sale limitations set forth in such rule, whether or not legally required; 


    (d) pursuant
to a tender or exchange offer made by the Company or not opposed by the Company's board of directors to the Company's stockholders or otherwise pursuant to
an acquisition of control of the Company; 


    (e) as
a bona fide pledge to a financial institution; or 


    (f)  with
the prior written consent of the Company. 




    SECTION
2.03.  Certain Actions.  During the term of this Agreement, each of Shareholder and the Trustee
agrees that it will not: 



    (a) "solicit",
or become a "participant" in any "solicitation" of, any "proxy" (as such terms are defined in Regulation 14A under the Exchange Act) from any
holder of Common Shares in connection with any vote on any matter, or agree or announce its intention to vote with any Person undertaking a "solicitation" other than pursuant to the terms of the Trust
Agreement; 


    (b) form,
join or in any way participate in a "group" (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to any Common Shares; 



    (c) initiate,
propose or otherwise solicit stockholders for the approval of one or more stockholder proposals with respect to the Company as described in
Rule 14a-8 under the 1934 Act, or induce or attempt to induce any other person to initiate any stockholder proposal; 


    (d) seek
election to or seek to place a representative on the Board of Directors of the Company or, except with the approval of management of the Company, seek the
removal of any member of the Board of Directors of the Company; 


    (e) except
with the approval of management of the Company, call or seek to have called any meeting of the stockholders of the Company; or 


    (f)  otherwise
act to seek to control, disrupt or influence the management, business, operations, policies or affairs of the Company. 




    SECTION
2.04.  Voting by the Trust.  During the term of this Agreement, the Trustee agrees that it shall
vote or cause to be voted all Common Shares owned by the Trust solely pursuant to the terms of the Trust Agreement. 


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ARTICLE 3  


 TERMINATION  


    SECTION
3.01.  Termination.  This Agreement shall terminate upon the occurrence of any of the following: 



    (a) the
two-year anniversary of the termination of the Trust Agreement; 


    (b) the
dissolution, liquidation or winding up of the Company; or 


    (c) any
(i) merger or consolidation of the Company with or into any other corporation or corporations where the stockholders of the Company immediately prior to
such transaction do not hold at least 50% of the outstanding voting equity securities of the surviving corporation after such merger or consolidation or (ii) sale of all or substantially all of
the assets of the Company, except to any wholly-owned subsidiary of the Company. 



ARTICLE 4  


 MISCELLANEOUS  


    SECTION
4.01.  Notices.  All notices, requests and other communications to either party hereunder shall
be in writing (including telecopy or similar writing) and shall be given, 



    if
to the Company, to: 




Liberate
Technologies

2 Circle Star Way

San Carlos, CA 94070

Fax: (650) 701-5258 





    if
to Shareholder, to: 




Delphi
Asset Management Corporation

6005 Plumas Street

Suite 202

Reno, NV 89509

Fax: (775) 689-3412 





    if
to Trustee, to: 




US
Trust Company of Delaware

1300 Market Street

Suite 605

Wilmington, Delaware 19801

Fax: (302) 428-9615 





    and 




United
States Trust Company of New York

114 West 47th Street

New York, New York 10036

Fax: (212) 852-1626 





or
such other address or telecopier number as such party may hereafter specify for the purpose by notice to the other party hereto. Each such notice, request or other communication sdhall be effective
when delivered at the address specified in this section 4.01. 


    SECTION
4.02.  Amendments; No Waivers.  


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    (a) Any
provision of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by
Shareholder, the Company and the Trustee, or in the case of a waiver, by the party against whom the waiver is to be effective. 



    (b) No
failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law. 




    SECTION
4.03.  Counterparts; Effectiveness.  This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement shall become effective as of the date first above
written. 


    SECTION
4.04.  Governing Law.  This agreement shall be construed in accordance with and governed by the
laws of the State of Delaware, without regard to the conflicts of law rules of such state. 


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    IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written. 



	 	 	LIBERATE TECHNOLOGIES
	

 	
 	

By:	
 	

/s/ MITCHELL E. KERTZMAN   

	 	 	 	 	Name:	 	Mitchell E. Kertzman
	 	 	 	 	Title:	 	CEO
	

 	
 	

DELPHI ASSET MANAGEMENT CORPORATION
	

 	
 	

By:	
 	

/s/ BARBARA R. WALLACE   

	 	 	 	 	Name:	 	Barbara R. Wallace
	 	 	 	 	Title:	 	President, CEO
	

 	
 	

US TRUST COMPANY OF DELAWARE, not in its individual capacity, but solely as Trustee of the Trust
	

 	
 	

By:	
 	

/s/ DEBRA W. PATTERSON   

	 	 	 	 	Name:	 	Debra W. Patterson
	 	 	 	 	Title:	 	Assistant Vice President
	

 	
 	

UNITED STATES TRUST COMPANY OF NEW YORK, not in its individual capacity, but solely as Trustee of the Trust
	

 	
 	

By:	
 	

/s/ JAMES E. LOGAN   

	 	 	 	 	Name:	 	James E. Logan
	 	 	 	 	Title:	 	Vice President




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EXHIBIT 4.2