<PAGE>

            CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN REDACTED
                    AND SEPARATELY FILED WITH THE COMMISSION


                                                                   Exhibit 10.49

                            PATENT LICENSE AGREEMENT

                                     BETWEEN

                       INTERDIGITAL TECHNOLOGY CORPORATION

                                       and

                     SONY ERICSSON MOBILE COMMUNICATIONS AB

                       Dated and Effective January 1, 2003

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                TABLE OF CONTENTS
                                                                            Page
                                                                            ----

ARTICLE I      DEFINITIONS....................................................1

ARTICLE II     LICENSE GRANT..................................................6

   2.1.           Grant.......................................................6

   2.2.           Limitations on License Grant................................6

ARTICLE III    PAYMENTS/PAYMENT TERMS.........................................6

   3.1.           Prior Sales.................................................6

   3.2.           2003-2006 Royalties.........................................7

   3.3.           Post 2006 Obligations.......................................8

   3.4.           Reports and Payment.........................................8

   3.5.           Good Faith Projections.....................................10

   3.6.           New Affiliates/Acquired Businesses.........................11

   3.7.           Credit for Sales by Manufacturers..........................11

   3.8.           Payment; Currency Conversion...............................11

   3.9.           Taxes......................................................12

   3.10.          License Acknowledgments....................................12

ARTICLE IV     PASS-THROUGH LICENSE..........................................12

ARTICLE V      TERM/TERMINATION..............................................13

   5.1.           Term.......................................................13

   5.2.           Termination for Default....................................13

   5.3.           Other Termination Rights...................................13

   5.4.           Termination Resulting from Bankruptcy......................13

ARTICLE VI     DISPUTE RESOLUTION............................................14

   6.1.           Agreement to Dispute Resolution Procedures.................14

   6.2.           Good Faith Negotiations....................................14

   6.3.           Mediation of Disputes......................................14

   6.4.           Arbitration of Disputes....................................14

   6.5.           Interim Measures from the Courts in Aid of Arbitration.....17

   6.6.           Mandatory Procedures.......................................17

   6.7.           Injunctive Relief..........................................17

   6.8.           Performance to Continue....................................17

   6.9.           Statute of Limitations.....................................17

   6.10.          Relief From Stay...........................................17

                                      -i-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                TABLE OF CONTENTS
                                  (Continued)
                                                                            Page
                                                                            ----

ARTICLE VII    REPRESENTATIONS AND WARRANTIES................................17

   7.1.           By ITC.....................................................17

   7.2.           By Licensee................................................18

   7.3.           By Both Parties............................................18

   7.4.           Disclaimer.................................................18

ARTICLE VIII   MISCELLANEOUS.................................................18

   8.1.           Confidentiality............................................19

   8.2.           Licensee Identification on Covered Terminal Units..........19

   8.3.           Headings...................................................19

   8.4.           Audit......................................................19

   8.5.           Governing Law/Venue........................................19

   8.6.           Affiliate Performance......................................20

   8.7.           Waivers....................................................20

   8.8.           Survival...................................................20

   8.9.           Severability...............................................20

   8.10.          Pre-Existing Rights Not Limited............................20

   8.11.          No Set Off.................................................20

   8.12.          Notices....................................................20

   8.13.          Limitation.................................................21

   8.14.          Personal Agreement.........................................21

   8.15.          Entire Agreement/Amendment.................................22

   8.16.          Counterparts...............................................22

   8.17.          Limitation of Liability....................................22

ARTICLE IX     RELEASE.......................................................22

                                      -ii-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                            PATENT LICENSE AGREEMENT

     THIS IS A PATENT LICENSE AGREEMENT (the "Agreement"), dated January 1,
2003, by and between InterDigital Technology Corporation ("ITC"), a Delaware
corporation having a mailing address of 300 Delaware Avenue, Suite 527,
Wilmington, DE 19801, and Sony Ericsson Mobile Communications AB ("Licensee"), a
corporation formed under the laws of Sweden and having a mailing address of Nya
Vattentornet, SE-221 88, Lund Sweden.

                                   BACKGROUND

     ITC owns and has the right to license the ITC Patents (as defined below).

     ITC, InterDigital and Ericsson Inc. are parties to a lawsuit concerning the
validity of certain of the ITC Patents and the alleged infringement of those
patents by Ericsson's sales of Covered Terminal Units and Infrastructure Units
(as defined below).

     Ericsson Inc., Telefonaktiebolaget LM Ericsson and their affiliates
transferred their Covered Terminal Unit business to Licensee effective October
1, 2001.

     ITC, InterDigital and Ericsson Inc. entered into a settlement of the
lawsuit in connection with the execution of this Agreement which provides, among
other things, that ITC will grant Licensee a non-exclusive, worldwide
royalty-bearing license under the ITC Patents (as defined below) for Covered
Terminal Units on the terms and conditions set forth in this Agreement.

     NOW, THEREFORE, in consideration of the mutual promises contained herein,
and intending to be legally bound, the parties agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

     "Affiliate" means a corporation or other legal entity of which more than
fifty percent (50%) of the voting stock is owned or effective control is held,
directly or indirectly, by Licensee or ITC, as the case may be. As used herein,
"effective control" shall mean that Licensee, (i) while holding less than a
majority of the voting stock or ownership of the entity, holds at or near the
maximum amount of equity ownership permitted by law (unless a lesser amount is
agreed to by ITC) and (ii) Licensee controls the operation and/or management of
the entity by (a) a majority control of the Board of Directors or equivalent
body, or (b) through substantial control of key technology. Such corporation or
other entity shall be considered an Affiliate of Licensee or ITC, as the case
may be, only so long as the requisite ownership of the voting stock or effective
control exists. For the purposes of this Agreement, based on the corporate
structures as of the Effective Date, (i) InterDigital shall not be considered an
Affiliate of ITC, and (ii) Sony Corporation shall not be considered an Affiliate
of Licensee.

     "Acquired Business" has the meaning ascribed to it by Section 3.6 hereof.

     "Acquisition Date" has the meaning ascribed to it by Section 3.6 hereof.

     "CDMA2000" means a family of IMT-2000 standards, as amended from time to
time, being developed by the 3GPP2, which standards evolved from narrow band
CDMA technologies (e.g., TIA/EIA 95 and cdmaOne) and, include without limitation
CDMA2000 1X, CDMA 1X EV-DO, CDMA-2000 1X EV-DV and CDMA2000 3X.

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     "Code Division Multiple Access" or "CDMA" means a method of digital spread
spectrum technology wireless transmission that allows a large number of users to
share access to a single radio channel by assigning unique code sequences to
each user thus permitting multiple simultaneous radio transmissions on the same
radio channel or frequencies.

     "Combi-Units" means a Subscriber Unit that has substantial functionality
unrelated to voice and data communications such as: (a) a computer, or a fully
featured PDA, or (b) a handset-like device, but with one or more of the
following integrated functionalities: (i) an enhanced display (more than 4,000
colors), (ii) some meaningful PIM (personal information management)
functionality, (iii) enhanced multimedia capability which may include a camera
and/or an ability to do video and audio streaming (real player), and/or the
ability to play music, (iv) memory stick or similar high function memory
transfer device and/or (v) enhanced wireless non-infrared connectivity (such as
802.11, ILink, fire wire/IEEE1394). For example, the Sony Ericsson P-800 would
be a Combi-Unit but a T68i would not since the T68i has an external camera, sold
separately.

     "Covered Standards" means the following recognized digital cellular
standards or other digital cellular specifications for digital cellular
TDMA-based communications systems describing the air interface between
infrastructure equipment and terminal units: TIA/EIA 54/136, GSM, GPRS, EDGE,
PDC, PHS, and with respect to Covered Terminal Units additionally all other TDMA
standards, as amended or enhanced from time to time (including TDMA based 2.5G,
TDMA based 2.75G, TDMA based 2.8G, etc., but not Third Generation (other than
EDGE)); provided, that in no event shall "Covered Standards" be construed to
include any Excluded Standard..

     "Covered Terminal Units" means Subscriber Units and End-User Devices
designed to operate in accordance with one or more Covered Standards. Covered
Terminal Units excludes Multi-Mode Products.

     "Deemed Price," with respect to:

          (a) any Covered Terminal Unit, (other than a Combi-Unit or Module)
shall mean the Net Selling Price (as defined below) of such Covered Terminal
Unit.

          (b) a Combi-Unit, shall mean the lesser of (i) the Net Selling Price
of the Combi-Unit or (ii) the average Net Selling Price of Covered Terminal
Units (excluding Combi-Units and Modules) using the same technological standard
as the Combi-Unit at issue (for example, GSM, GSM/GPRS, GSM/GPRS/EDGE).

          (c) a Module, shall mean (i) in the case of Modules Sold for use in
Covered Terminal Units, (e.g., personal digital assistants and handsets), the
greater of (a) the Net Selling Price of the Module; or (b) the average Net
Selling Price of Covered Terminal Units (excluding Combi-Units and Modules) for
the period for which Royalties are being reported; and (ii) in the case of a
Module Sold for other uses, for example, for point-of-purchase machines or
vehicles (when integrated into the vehicle), the Net Selling Price of the
Module.

     "Dispute" means any dispute, claim, or controversy arising out of or
relating to this Agreement.

     "Dollar," "dollar" or "$" shall mean United States Dollar.

     "EDGE" means the "Enhanced Data rates for GSM Evolution" standard as
amended from time to time.

                                      -2-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     "Effective Date" means January 1, 2003.

     "End-User Devices" means fully integrated baseband/RF wireless
communications devices designed for use by an end user in combination with
another device but without significant further physical integration into such
device being serviced by such integrated modem/baseband/RF wireless
communications device and providing complete wireless communication capability
under the applicable Covered Standard. An example of an End-User Device is a
PCMCIA card (which may include an antenna) for simple insertion (generally by
the end user) into a laptop computer to provide wireless communication
capability.

     "Ericsson Family" means Ericsson Inc., Telefonaktiebolaget LM Ericsson,
each of their Affiliates, and the corporations or other legal entities of which
more than fifty percent (50%) of the voting stock is owned or control is held,
directly or indirectly, by Ericsson Inc. or Telefonaktiebolaget LM Ericsson.

     "Excluded Standards" shall mean CDMA-based 2G, CDMA-based 2.5G, CDMA-based
2.75G, CDMA-based 2.8G, etc., digital cellular standards (including without
limitation TIA/EIA95), Third Generation digital cellular standards (including
without limitation WCDMA and CDMA2000) other than EDGE, in each case as amended
from time to time and future standards (e.g., 4G). For the avoidance of doubt, a
product shall not be considered to operate in whole or in part in accordance
with an Excluded Standard solely on the basis that such product supports a
service or feature of an Excluded Standard (e.g. 384 kps on the downlink as
specified in the Third Generation standard) if such product (i) operates in
accordance with a Covered Standard, (ii) achieves the feature or service by
operation in accordance with a Covered Standard and not by operation in
accordance with the air interface protocol of an Excluded Standard, (iii) is not
advertised, sold or substantially designed as a Third Generation Product and
(iv) does not operate on a frequency spectrum that operates in accordance with
an Excluded Standard.

     "GPRS" means the standard developed for digital cellular networks (GSM,
DCS, PCS) promulgated by the European Telecommunications Standards Institute, as
amended from time to time, which utilizes a packet radio principle and can be
used for carrying end users' packet data protocol (such as IP and X.25)
information from/to GPRS terminals to/from other GPRS terminals and/or external
packet data networks technology.

     "GSM" means the compatibility standard developed for the 900 MHZ
PanEuropean digital TDMA cellular mobile radio communication system, promulgated
by the European Telecommunications Standards Institute, as amended from time to
time, or the compatibility standard developed for PCS based on GSM but intended
for use in the 850 MHZ, 1.8 GHz and 1.9 GHz bandwidths ("DCS 1800-1900"), as
amended from time to time.

     "InterDigital" means InterDigital Communications Corporation, having an
office at 781 Third Avenue, King of Prussia, PA 19406.

     "Infrastructure Unit" shall mean wireless network equipment including but
not limited to mobile switching centers, base station controllers, base
stations, positioning node equipment and operation and maintenance equipment.

     "ITC Patents" means the following to the extent owned or controlled by ITC,
InterDigital or any of their Affiliates: all patents (including utility models
and excluding design patents) issued and issuing on patent applications entitled
to an effective filing date prior to January 1, 2007, if ITC, InterDigital or
any of their Affiliates now has or hereafter obtains the right to grant licenses
to such patents or patent applications of (or within) the scope granted to
Licensee herein without such grant or Licensee's exercise

                                      -3-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

of rights thereunder resulting in the payment of royalties or other
consideration by ITC or its Affiliates to any third party. The term "ITC
Patents" shall also include any patent reissuing on any of the aforesaid patents
or patent applications.

     "Knock-Down Unit" means a substantially complete Covered Terminal Unit Sold
to a third party in a partially or assembled form for final manufacturing,
packaging, sale and distribution to meet the local manufacturing requirements of
a particular country. Knock-Down Unit shall be treated as a Module for purposes
of determining Deemed Price.

     "Module" means a fully integrated wireless communications product,
including required ASICS, software and/or firmware, that is designed to operate
in accordance with an applicable Covered Standard and which is sold to a third
party for physical integration into other devices such as handsets, vending
machines, computers, laptop computers, sensing/telemetry applications, motor
vehicles and fixed wireless telephone systems. An example of a Module is the
Gm28 produced by Licensee.

     "Multi Mode Product" means a dual or multi mode Terminal Unit operating in
accordance with both one or more Covered Standards and one or more Excluded
Standards (e.g., a handset with GSM and 3G capabilities).

     "Net Selling Price" means the amount actually invoiced to the customer for
a Covered Terminal Unit package (including Covered Terminal Unit, battery,
charger and included standard accessories), excluding the amounts shown on the
invoice for the actual cost of packing, insurance, shipping and handling,
applicable import, export and excise duties and sales tax (including VAT added
by Licensee to the completed Covered Terminal Unit), and reduced by, returns,
price protection credits, and trade discounts given to the customer in the
normal course of business. To the extent that Covered Terminal Units are Sold
with non-standard accessories, the Net Selling Price for such Covered Terminal
Units shall be the average amount actually invoiced to customers for the same
Covered Terminal Unit Sold during the same period with only standard
accessories, as adjusted for the costs and reductions set forth above.

     "Payment" means monies for license fees, royalties and other amounts owed
to ITC pursuant to this Agreement.

     "PDC" means the RCR STD 27 compatibility standard developed in Japan known
as PDC or Personal Digital Cellular or Pan Asian Digital Cellular for TDMA
digital wireless mobile radio communication systems, as amended from time to
time.

     "PHS" means the RCR STD 28 compatibility standard developed in Japan and
known as the Personal Handyphone Standard, as amended from time to time.

     "Restricted Patent Claims" means an ITC Patent claim with a priority date
after March 1, 2003 that is not related principally to operations, processes or
functionality of a Covered Standard but which has broader applicability to
communications technologies. [**] For the avoidance of doubt, a Restricted
Patent Claim shall in no event include an ITC Patent claim that is technically
or commercially essential to a Covered Standard.

     "Royalty" shall have the meaning ascribed to it by Section 3.2 of this
Agreement.

----------
[**] Material has been omitted and filed separately with the Commission.

                                      -4-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     "Sale," "Sell," and "Sold" refer to the first sale, lease or other
disposition made by Licensee or a Licensee Affiliate on an arms-length basis to
any party that is not an Affiliate of Licensee.

     "Subscriber Unit" means a radiotelephone, or a device with radiotelephone
capabilities (e.g. Personal Digital Assistant) whether fixed, mobile,
transportable, vehicular, portable or hand-held (or a Module therefore).
Subscriber Units shall include Modules, Combi-Units and Knock-Down Units.

     "TDMA" means time division multiple access.

     "Term" shall have the meaning ascribed to it by Article V of this
Agreement.

     "Terminal Unit" shall mean an End User Device or Subscriber Unit that may
or may not operate in accordance with a Covered Standard.

     "Third Generation" means any TDMA- or CDMA-based digital cellular mobile
radio telecommunication standards generally considered by the industry to be the
third generation, whether adopted by any recognized standardizing body or
promoted by major telecommunications operators as de facto standards, but
excluding any standard designated herein as a Covered Standard. Examples of
current Third Generation standards under development, or related standardization
efforts, are the International Telecommunications Union - Radio efforts under
the label IMT-2000, the specifications being developed under the Third
Generation Partnership Projects (3GPP and 3GPP2), and comparable or related
standards adopted by ARIB, ETSI, TTA, TIA, T1P1, CWTS, as well as other
recognized standards development organizations.

     "TIA/EIA 54/136" means the Cellular Dual Mode Mobile Station-Base Station
Compatibility Standards promulgated by the Electronics Industry Association and
the Telecommunications Industry Association, as amended from time to time, and
improved to include, among other things, a digital control channel, and formerly
known as IS-54 and IS-136.

     "TIA/EIA 95," formerly known as "IS-95," means the Mobile Station-Base
Station Compatibility Standard for Dual-Mode Wideband Spread-Spectrum Cellular
Systems, as administered by the Telecommunications Industry Association and as
amended from time to time, including without limitation TIA/EIA 95A and TIA/EIA
95B.

     "Transferee" has the meaning ascribed to it by Section 8.14(b) hereof..

     "Transferred Business" has the meaning ascribed to it by Section 8.14(b)
hereof.

     "Unlicensed Sales" means sales of Covered Terminal Units without (or
outside of the scope of) a license granted by ITC.

     "Wideband CDMA" or "WCDMA" means a version of CDMA technology optimized for
high speed packet-switched data and high-capacity circuit switched capabilities.

     "Wideband" refers to a communications channel with a user data rate higher
than a voice-grade channel; usually 64kpbs to 2mbps.

                                      -5-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                   ARTICLE II
                                  LICENSE GRANT

     2.1. Grant. ITC hereby grants, and shall cause its Affiliates to grant, to
Licensee and Licensee's Affiliates a perpetual (except as set forth in Section
3.3), non-exclusive, worldwide, royalty-bearing license under the ITC Patents:
(i) to use, lease, design, make, have made, import, sell, and otherwise transfer
Covered Terminal Units, including the right to procure or produce components
therefor, (ii) to practice a method or process involved in the manufacture
thereof, and (iii) to practice any method or process involved in the use
thereof.

     2.2. Limitations on License Grant.

          (a) Except as expressly set forth in this Agreement, the license
granted hereunder excludes the right to grant sublicenses and, the right to
assign or otherwise transfer this Agreement or the license granted hereunder.

          (b) The license granted hereunder shall not include, by implication or
otherwise, any license for (i) any product other than Covered Terminal Units,
(ii) any Multi Mode Product or (iii) any ASICs, reference design, software or
other components except when used solely as a part and within the Covered
Terminal Units sold by Licensee and its Affiliates or as spare parts and
enhancements therefor.

          (c) The license granted in this Agreement shall extend to the
Affiliates of Licensee existing as of the Effective Date. Licensee represents
that Attachment A to this Agreement lists all of Licensee's Affiliates existing
as of the Effective Date and as of the execution date of this Agreement.
Licensee shall notify ITC of entities that become Licensee Affiliates during the
Term according to Section 3.6, in which event the provisions of Section 3.6
shall apply, and of entities that cease to be Licensee Affiliates during the
Term, in which event the provisions of Section 8.14 shall apply to the extent
relevant, in each case, in the royalty report following the event giving rise to
the notice obligation. Licensee hereby guarantees the full and prompt remittance
of all Payments and other amounts owed to ITC by Licensee and all Licensee
Affiliates pursuant to this Agreement, and each Licensee Affiliate's compliance
with the terms and conditions of this Agreement.

          (d) Only to the extent necessary to effectuate Licensee's or its
Affiliates use of its "have made" rights granted under Section 2.1 hereof,
Licensee or a Licensee Affiliate shall be authorized to grant sublicenses under
this Agreement to third parties operating under such "have made" right. Such
sublicense shall have the strictly limited purpose of effectuating that "have
made" grant, shall not authorize any activity beyond the "have made" activity,
shall be subject to the relevant terms of this Agreement, and shall not affect
the consideration required hereunder (which shall remain the responsibility of
Licensee and its Affiliates).

                                      -6-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ARTICLE III
                             PAYMENTS/PAYMENT TERMS

     3.1. Prior Sales.

          (a) In partial consideration for the Release granted by Article IX
hereof, Licensee shall pay to ITC a non-refundable payment of [**] on Sales of
Covered Terminal Units by Licensee from [**].

     (b) In further consideration of the Release granted by Article IX hereof,
Licensee shall pay ITC the non-refundable compensation for Sales of Covered
Terminal Units in 2002 calculated in accordance with this Section 3.1(b).
Licensee, on or before April 15, 2003 shall provide ITC with a written report by
an appropriate responsible employee of Licensee showing the quantities of each
model of Covered Terminal Units Sold by Licensee and its Affiliates from January
1, 2002, through December 31, 2002, and compensation owing in respect of such
Sales, such compensation to be calculated at the lowest rate for which Licensee
qualifies in the table of rates set forth in this Section 3.1(b). The
compensation is expressed in the table of rates as a percentage of Deemed Price
of the Covered Terminal Units. If Licensee Sold in excess of [**] Covered
Terminal Units in 2002, excluding PDC Covered Terminal Units, then the Deemed
Price to be used for determining the Royalties to be paid hereunder for any
individual Covered Terminal Unit shall be capped at [**].

  Number of Covered Terminal
Units (excluding PDC Terminal        Royalty Rate for
     Units) Sold in 2002                   2002
-----------------------------        ----------------
             [**]

          (c) Licensee shall pay ITC the compensation set forth in Sections
3.1(a) and 3.1 (b) in accordance with the following schedule:

            Payment                      Due Date
-----------------------------        ----------------
A)   Section 3.1(a) Payment                [**]
B)   Section 3.1(b) Payment                [**]

     3.2. 2003-2006 Royalties. In consideration for the license granted herein
with respect to Covered Terminal Units, Licensee shall pay to ITC a
non-refundable royalty ("Royalty") on each Sale of a Covered Terminal Unit by
Licensee and its Affiliates, anywhere in the world, for the period commencing
January 1, 2003 through December 31, 2006. The total Royalty shall be calculated
at the lowest royalty rate for which Licensee qualifies in the following table
of rates and shall be subject to the additional discounts provided for in the
prepayment provisions. The Royalty is expressed in the table of rates as a
percentage of Deemed Price of the Covered Terminal Units:

Number of Covered Terminal Units (excluding PDC
  Terminal Units) Sold During the Immediately       Royalty Rate   Royalty Rate
            Preceding Calendar Year                for 2003/2004   for 2005/2006
------------------------------------------------   -------------   -------------
                     [**]
  Greater than [**] Covered Terminal Units, or          [**]            [**]
cumulative Covered Terminal Unit volumes of [**]

----------
[**] Material has been omitted and filed separately with the Commission.

                                      -7-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

               Notwithstanding the foregoing, the Royalty rate shall be [**]% of
the Deemed Price of the Covered Terminal Unit Sales made in calendar year 2003
if, by April 15, 2003, Licensee provides ITC with good faith projections from an
appropriate responsible officer, showing that Licensee and Licensee's Affiliates
collectively are likely to Sell more than [**] Covered Terminal Units during
calendar years 2002 and 2003. In addition, for any year in which Licensee is
entitled to calculate Royalties using the rates shown in the above chart for
volumes of [**] to [**] units, or volumes in excess of [**] units (i.e., the two
bottom lines of the chart above in this Section 3.2), then the Deemed Price to
be used for determining the Royalties for any individual Covered Terminal Unit
to be paid hereunder shall be capped according to the following schedule:

2003                [**]
2004                [**]
2005                [**]
2006                [**]

     3.3. Post 2006 Obligations. Unless this Agreement is sooner terminated or
Licensee is in default hereunder, the license granted to Licensee under the ITC
Patents (other than the Restricted Patent Claims) as set forth (and limited)
under Article II shall be deemed fully paid up as of January 1, 2007 based on
Licensee's payment of the all Payments due under this Agreement. The license for
the Restricted Patent Claims will expire on December 31, 2006.

     3.4. Reports and Payment.

          (a) Reports. For all calendar quarters commencing on or after the
Effective Date, within forty-five (45) days after the end of each calendar
quarter, Licensee shall provide a written report from an appropriate responsible
employee of Licensee setting forth the amount of the Royalties and calculation
thereof for the reported period regardless of whether or not any Payment is due.
All such reports shall be treated as Licensee confidential information for the
purposes of Section 8.1 of this Agreement. Licensee shall also provide ITC in
writing with an advanced Royalty Sales projection, on a non-binding basis, no
later than seventy-five (75) days after the end of each calendar quarter that
sets forth the aggregate Royalties Licensee anticipates reporting for the
then-current calendar quarter regardless of whether or not any Payment is
projected.

          (b) Payment of Royalties After [**]. Except to the extent prepaid,
Payment for all Royalties on Sales occurring on or after [**] shall be made on a
quarterly basis within forty- five (45) days after the end of each calendar
quarter. Such payment shall be for all Sales of Covered Terminal Units made by
Licensee or its Affiliates during such quarter.

          (c) Prepayment of Ongoing Royalties. Licensee will make a pre-payment
of Royalties for the twenty-four month period covering January 1, 2003 through
December 31, 2004. Licensee shall have the option to make additional
pre-payments of Royalties, each such pre-payment covering a new [**] period
(except for shorter periods authorized in Sub-Section (ii) below) including
making additional payments for a period overlapping the [**] period or any other
previous pre-paid period to the extent any such prior pre-payments are found, or
are expected to be, insufficient to satisfy the Sales made or to be made during
such pre-paid period. All such pre-payments shall be calculated as set forth
below, and shall be non-refundable (except as set forth in Section 3.4(h)).

----------
[**] Material has been omitted and filed separately with the Commission.

                                      -8-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

               (i) Calculation of Prepayment: To determine the amount of a
     pre-payment for a twenty-four month period, Licensee shall determine the
     amount of royalties projected for such period by (i) projecting in good
     faith the number of Covered Terminal Units to be Sold, the applicable
     Deemed Prices (subject to the selling price caps set forth in Section 3.2
     above), and the year in which such units would be sold, and then (ii)
     applying the royalty rate as set forth in Section 3.2 that is applicable
     for the projected volumes in each year. Such amount shall then be
     discounted as follows:

                    a. The pre-payment of Royalties in respect of projected
          Sales during the [**] portion of the [**] prepayment period shall be
          discounted for present value based on a present value discount factor
          of [**], which is the present value discount rate of [**]% per annum,
          single payment at the end of the twelve month period.

                    b. The pre-payment of Royalties in respect of projected
          Sales during the [**] portion of the [**] pre-payment period shall be
          discounted for present value using a present value discount factor of
          [**], which is the present value discount rate of [**]% per annum,
          single payment [**].

                    c. The sum of the amounts calculated under (a) and (b)
          above, shall be further be discounted by a single advance payment
          discount of [**]%, which discounted amount shall be the Royalty
          pre-payment amount to be paid by Licensee.

               (ii) Timing of Payments. On or before April 15, 2003, Licensee
     shall provide ITC with a report prepared by an appropriate responsible
     employee showing the calculation and details of the pre-payment for the
     [**] period. The Royalty prepayment for [**] shall be paid in two
     installments, [**]. Except as provided in subparagraph (iii) below (a)
     Licensee shall make any future pre-payments no later than 10 days prior to
     the end of the calendar quarter during which a prior pre-payment was
     exhausted, or (b) if Licensee elects to pay Royalties for some period of
     time without use of the pre-payment credit method set forth herein and then
     elects to return to the pre-payment method, then Licensee shall make such
     payment no later than 10 days prior to [**] for which Royalties are being
     pre-paid. With every such pre-payment, Licensee shall provide ITC with a
     report prepared by an appropriate responsible employee showing the
     calculation and details related thereto.

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                                      -9-

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                                                     PRIVILEGED AND CONFIDENTIAL

               (iii) Tail Period. Commencing with the royalty report [**]
     Licensee shall include in each of its royalty reports a good faith
     assessment as to when any remaining pre-payment reported in such royalty
     report is expected to be exhausted in the future, based on the average of
     Royalties reported in the last three Royalty reports (inclusive of the then
     current report.) If Licensee determines that the remaining pre-payment will
     likely be exhausted within the calendar quarter in which such royalty
     report is being submitted, then Licensee shall have the option to pre-pay
     additional royalties through the end of 2006, in an amount sufficient to
     cover any shortfall, plus the amount to cover Sales through to the end of
     2006. Such additional pre-payment shall be made at the time of Licensee
     submitting the royalty report that includes such assessment. Thereafter,
     Licensee shall continue to assess in each royalty report whether its
     pre-payment will be sufficient to cover Sales up to and including December
     31, 2006 (using the same methodology as set forth above) and Licensee shall
     have the option to make additional payments as necessary to cover any
     expected shortfall, with such additional payment to be made with said
     royalty report. Provided Licensee elects to make pre-payments in the manner
     specified in this Section, Licensee may avail itself to both the full
     present value discount of [**] for Sales expected to occur in [**] and [**]
     for Sales expected to occur in [**], and the [**]% advance payment discount
     in determining such additional payment.

          (d) Exhaustion of Prepayments.

     In return for such prepayment(s), Licensee shall receive a Royalty credit
equal to the undiscounted royalties that served as the basis for the
pre-payment. Licensee may use such Royalty credit to offset its actual Royalty
obligation (calculated on a undiscounted basis) on Sales of Covered Terminal
Units until such Royalty credit is exhausted (even if such exhaustion occurs
after the end of the [**] period for which such pre-payment had been made).
Licensee will calculate its Royalty obligation at the rate set forth in the
chart above and reduce its prepayment credit by the ratio of the calculated
Royalty to the Royalty credit, an example of which is set forth in Attachment D.

          (e) PDC Prepayment Benefit. In addition, provided Licensee is entitled
to use the Royalty rate stated in the last line of the chart in Section 3.2
herein for the greater than [**] volumes and Licensee makes a prepayment
pursuant to this Section 3(e), Licensee shall receive an additional PDC Royalty
credit in the amount of [**] of the Royalty credit associated with any
twenty-four (24) month prepayment but not to exceed [**], which may be applied
only to Royalties due on PDC Covered Terminal Units from and after January 1,
2002, until exhausted; provided that, in calculating the Royalties to be applied
against such credit, Licensee shall use the discounted rate (applicable base
rate discounted by the [**] advance payment discount) as opposed to the
undiscounted rates applied to other Covered Terminal Units, and a Deemed Price
cap of [**] per unit for Sales of PDC Covered Terminal Units in [**] and the cap
specified in Section 3.3 thereafter, to reduce its pre-payment credit. In the
event that Licensee has PDC Covered Terminal Unit Royalty liability for Sales
through [**] exceeding its then available PDC Royalty Credit, then Licensee may
defer payment of up to [**] of such excess Royalty liability until such time as
Licensee makes a pre-payment covering all or a portion of the [**] period, and
then apply such excess liability against the PDC Royalty credits related to such
pre-payment. If Licensee elects not to make a pre-payment upon the exhaustion of
the initial [**] pre-payment, then such option to defer excess PDC Royalty
credit shall be eliminated and Licensee shall pay Royalties for such PDC Covered
Terminal Units at the undiscounted rates. An example of the royalty credit and
exhaustion calculation is shown on Attachments D and F, respectively.

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                                                     PRIVILEGED AND CONFIDENTIAL

          (f) Sample Calculations. Sample calculations of the pre-payment
(including applicable discount rate factors) and credit exhaustion methods are
set forth in Attachments C and D hereto. Licensee shall not be entitled to any
discount from the Royalty rate set forth in this Article III except as expressly
provided by this Article III. Attachment G shows an example of the amount of
Royalties to be paid for a specified amount of Net Sales of Covered Terminal
Units achieved under example assumptions displayed therein, which include
Licensee taking discounts available through the exercise of prepayment options
throughout the Term of this License Agreement.

          (g) Right to Pre-Payment Benefits. Provided Licensee elects to make
pre-payments in the manner (including timing) stated in this Section 3.4, then
Licensee may avail itself to the benefits of the pre-payment options, as set
forth herein. If Licensee does not make pre-payments as required herein and/or
in any royalty report, does not have adequate pre-payment credits to satisfy its
Royalty obligations in such reported calendar quarter, then Licensee shall not
be entitled to avail itself to any of the pre-payment benefits and shall pay
such royalties at the undiscounted rates.

          (h) Overpayments. Within 180 days of Licensee's final Royalty report
for 2006 and subject to the resolution of any Disputes pursuant to Article VI
hereof, ITC shall refund to Licensee any prepayment then remaining unexhausted.
In no event shall any refund exceed [**].

     3.5. Good Faith Projections. Any projection under this Article III shall be
deemed to be made in good faith if based upon unit volumes and selling prices
known to Licensee at the time. Licensee shall not be bound by any good faith
projection. All such good faith projections shall be considered Licensee
proprietary information and be held in confidence pursuant to Section 8.1
herein. ITC agrees not to use any such good faith projection against Licensee in
any Dispute or legal proceeding.

     3.6. New Affiliates/Acquired Businesses.

          (a) If, after the Effective Date, Licensee or any Licensee Affiliate
(i) acquires, or acquires control of, an entity, or a business or assets of an
entity, that is not then-currently an Affiliate, or (ii) forms a new Affiliate,
in either case involved in the manufacturing, distribution or sale of Covered
Terminal Units (each, an "Acquired Business"), the terms of this Agreement will
govern activities of the Acquired Business with respect to Covered Terminal
Units Sold after the effective date of the acquisition or formation (the
"Acquisition Date").

          (b) If and to the extent the Acquired Business, prior to the
Acquisition Date, manufactured or sold Covered Terminal Units pursuant to a
license granted by ITC, the Acquired Business' then-existing agreement shall
continue to apply as to products or standards other than Covered Terminal Units
and this Agreement shall apply as to Covered Terminal Units.

     [**]

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                                                     PRIVILEGED AND CONFIDENTIAL

     3.7. Credit for Sales by Manufacturers. In the event an entity, such as an
original equipment manufacturer licensed by ITC ("OEM") under the ITC Patents,
has paid royalties to ITC for the Sale of Covered Terminal Units and the OEM
supplies such Covered Terminal Units to Licensee under the "have made" grant
provided for herein, Licensee shall be entitled to a credit against the Royalty
due hereunder in the amount of the royalty actually paid by the OEM to ITC. In
its royalty reports, Licensee shall provide ITC with sufficient details as to
any such Covered Terminal Units purchased from third parties, to permit ITC to
determine any Royalty credit that may apply. ITC will provide Licensee with such
credit, which may be applied by Licensee in its next Royalty report.
Notwithstanding the foregoing, the credit resulting from the OEM's payments of a
royalty on a Covered Terminal Unit may not exceed the Royalty paid by Licensee
on the same Covered Terminal Unit.

     3.8. Payment; Currency Conversion. Payments made pursuant to this Article
III shall be made by wire transfer in Dollars to the following account or such
other account as ITC may specify by written notice:

          [**]

     Dollar denominated sales shall be reported as transacted. Other currency
denominated sales shall be reported based on the mathematical average foreign
currency/$U.S. conversion rate applicable during the period over which sales are
being reported, using the currency exchange rates given in the Wall Street
Journal - Currency Trading, Exchange Rates section, or other source as the
parties may agree in writing or an exchange of writings.

     3.9. Taxes. Licensee shall be responsible for all income, withholding taxes
and other taxes associated with Payments imposed by any jurisdiction other than
the United States and its political subdivisions, so long as ITC remains
domiciled in the United States. All Payments paid under this Agreement shall be
"grossed up" as required to meet Licensee's obligations under this Section 3.9
so that the net amount actually paid to ITC is equal to the Payments calculated
in accordance with this Agreement. If any such tax is required by the relevant
government, Licensee will furnish ITC with appropriate documentation evidencing
the payment of such tax as assessed by the appropriate authority of such
government.

     3.10. License Acknowledgments. Both parties acknowledge that:

          (a) All Payments made hereunder shall be nonrefundable, except as
provided for in Section 3.4 (h).

          (b) The parties have agreed to the Payments specified in this
Agreement as a matter of mutual convenience to the parties, regardless of which
of the ITC Patents may be involved.

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                                      -12-

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                                                     PRIVILEGED AND CONFIDENTIAL

          (c) In the event of a bankruptcy or similar insolvency proceeding
filed by or against either party: (i) Licensee's and Licensee's Affiliates'
continued rights under the licenses granted herein would convey substantial
financial and other benefits to each respective Party, their Affiliates and
their respective businesses and creditors such that the Payments accruing
hereunder would constitute an Administrative Claim under 11 U.S.C. Sections
503(b) and 507 (or comparable non-U.S. provision); (ii) this Agreement shall be
deemed to be an executory contract under 11 U.S.C. Section 365 (or comparable
non-U.S. provision) because, inter alia, there remain substantial mutual
obligations to be performed by the parties hereto; and (iii) this Agreement
shall not be assumable under 11 U.S.C. Section 365(c)(1) (or comparable non-U.S.
provision) without ITC's consent.

                                   ARTICLE IV
                              PASS-THROUGH LICENSE

     Provided that this Agreement is not terminated at the time of Sale,
Licensee's and Licensee's Affiliates' customers will receive a pass-through
license for any such Sale (including lease) and use of Covered Products,
provided that such pass-through license shall not limit causes of action, claims
or remedies ITC may have hereunder against Licensee or Licensee's Affiliates,
for Licensee's or Licensee's Affiliates' breach of this Agreement.

                                   ARTICLE V
                                TERM/TERMINATION

     5.1. Term. The Term of this Agreement shall be deemed to have commenced on
January 1, 2003 and, unless earlier terminated in accordance with this Article
V, shall terminate upon the expiration of the last-to-expire ITC Patent.

     5.2. Termination for Default. This Agreement may be terminated by either
party with written notice, following thirty (30) days written notice of material
breach, provided, however, that in the case of a Dispute not involving the
failure to make Payment under Section 3.1(a) hereof, the provisions of Article
VI will take precedence. Such termination will take effect at the end of the
notice period if the other party is in material breach of any of its material
obligations hereunder and fails to remedy the breach within the notice period.
Without limiting the foregoing, Licensee shall be in material breach of this
Agreement if (i) Licensee or any Licensee Affiliate fails to comply with its
reporting and payment obligations hereunder, (ii) Licensee, any Licensee
Affiliate or any trustee in bankruptcy, receiver or other successor-in-interest
to Licensee or any Licensee Affiliate attempts to recover any Payments
previously made (including without limitation on the theory that such Payment
was a preference under 11 U.S.C. Section 547 or otherwise), or (iii) Licensee or
its successor-in-interest rejects this Agreement or fails, within sixty (60)
days of the filing of any voluntary or involuntary petition in bankruptcy by or
against Licensee under Section 365 of the U.S. Bankruptcy Code or any comparable
non U.S. provision, to assume this Agreement. In the event of the occurrence of
(ii) or (iii), ITC shall be entitled to immediately terminate this Agreement
without notice. In the event of termination of this Agreement by ITC, all
Payments specified by Sections 3.1 and 3.4 of this Agreement and all other
Payments accruing hereunder shall become immediately due and payable, and
Licensee shall pay all such amounts in full within thirty (30) days of the
effective date of ITC's notice of termination.

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                                                     PRIVILEGED AND CONFIDENTIAL

     5.3. Other Termination Rights. If, during the Term, Licensee or one or more
of its Affiliates institutes or actively participates as an adverse party in, or
otherwise provides material support to, any legal action anywhere in the world,
the purpose of which is to invalidate or limit the validity or scope of any of
the ITC Patent claims which read on Covered Standards, and fails within thirty
(30) days of discovery or being notified of the same to terminate or cause the
termination of such legal action or fails within sixty (60) days of discovery or
being notified of the same, to otherwise cure all of the adverse effects of
Licensee's or the Licensee's Affiliate's activities as described above, ITC
shall have the right to terminate this Agreement upon written notice without
first having to pursue the Dispute resolution procedures set forth in Article
VI. Notwithstanding the provisions above, ITC shall have no right to terminate
this Agreement pursuant to this Section 5.3 with regard to any legal action
initiated prior to the execution date of this Agreement in which Licensee or its
Affiliates participated, directly or indirectly, provided, that, if such action
is continuing, Licensee and its affiliates promptly withdraw from such
proceeding, discontinue any direct or indirect participation therein, and
provide reasonable assistance to ITC in dealing with any adverse material
effects resulting from such, to the extent permitted by law. In no event shall
anything in this Agreement be construed to impose liability on Licensee for any
damages which may result from Licensee's participation in such legal actions
prior to the execution date of this Agreement.

     5.4. Termination Resulting from Bankruptcy. This Agreement shall terminate
automatically without action by either party if, pursuant to the U.S. Bankruptcy
Code (or comparable non-U.S. law), Licensee as debtor-in-possession or any
trustee in bankruptcy or other successor-in-interest to Licensee rejects this
Agreement pursuant to 11 U.S.C. Section 365 (or comparable non-U.S. law).

                                   ARTICLE VI
                               DISPUTE RESOLUTION

     6.1. Agreement to Dispute Resolution Procedures. Any Dispute shall be
resolved in accordance with the procedures specified in this Article VI, which
shall be the sole and exclusive procedures for the resolution of any such
Disputes. Notwithstanding the foregoing, except as the parties may agree in
writing, neither party shall be compelled to submit to negotiation, mediation or
arbitration under this Article VI any dispute or other matter relating to
Licensee's alleged infringement of ITC's Third Generation patents.

     6.2. Good Faith Negotiations. In the event of any Dispute, the parties
shall first attempt in good faith to resolve such Dispute promptly by
negotiation between senior level representatives who have authority to settle
the Dispute. Any party may give the other party written notice of any Dispute
not resolved in the normal course of business. Within 15 days after delivery of
the notice, the receiving party shall submit to the other a written response.
The notice and the response shall each include (a) a statement of the party's
position and a general summary of arguments supporting that position, and (b)
the name and title of the person(s) who will represent that party in the
negotiations. Within 30 days after delivery of the notice of Dispute, the
representatives of the parties shall meet in Washington, D.C., or some other
mutually acceptable time and place, and thereafter as often as they reasonably
deem necessary, to attempt to resolve the Dispute. All reasonable requests for
information made by one party to the other will be honored; however, no party is
required to provide confidential, trade secret, proprietary, or privileged
information excepting information that is required to be provided pursuant to
this Agreement. All negotiations pursuant to this clause are confidential and
shall be treated as compromise and settlement negotiations for purposes of
applicable rules of evidence. If a party refuses to negotiate as provided
herein, the any other party may immediately initiate arbitration as provided in
Article VI.

                                      -14-

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                                                     PRIVILEGED AND CONFIDENTIAL

     6.3. Mediation of Disputes. If any Dispute has not been resolved by
negotiation as set out above within 90 days of delivery of the notice of
Dispute, or if the parties failed to meet within 30 days of delivery of the
notice of Dispute, the parties shall endeavor to settle the Dispute by good
faith mediation. Upon the expiration of the negotiating period, any party may
give written notice of mediation. The parties shall attempt to agree upon a
qualified, neutral individual who shall serve as mediator. If the parties fail
to agree upon a mediator within 15 days of delivery of the notice of mediation,
the mediator will be appointed by the American Arbitration Association from its
roster of neutral mediators. The mediation shall occur in Washington, D.C.
within 30 days after appointment of a mediator, or at such other time and place
as the parties may agree. Any Dispute which remains unresolved 60 days after
appointment of a mediator shall be settled by arbitration in accordance with
Section 6.4 of this agreement. If a party refuses to participate in the
mediation process as provided herein, any other party may immediately initiate
arbitration as provided in Section 6.4. The parties shall bear the cost of the
mediation equally between them. Each party shall be responsible for its own
attorneys' fees relating to the mediation. Other than with respect to its
occurrence or the failure to occur, the mediation is in all respects
confidential and shall be treated as compromise and settlement negotiations for
purposes of applicable rules of evidence. The mediator may not serve as an
arbitrator in any subsequent arbitration proceedings concerning the Dispute.

     6.4. Arbitration of Disputes. If any Dispute has not been resolved by the
non-binding procedures set forth in Sections 6.2 and 6.3 within the time periods
provided for therein, either party may submit the Dispute to arbitration
administered by the American Arbitration Association ("AAA") under its then
current ICDR International Arbitration Rules ("AAA International Rules"), and as
set forth in this Article. The arbitration proceeding shall take place in
London, UK, in English, before a panel of three (3) arbitrators, all of whom
shall be admitted to practice law in at least one jurisdiction in the United
States, and at least one of whom shall have substantial experience in the field
of patent licenses. The arbitration shall be commenced and conducted as follows:

          (a) Three arbitrators, appointed in accordance with the AAA
International Rules, shall hear the Dispute. Any person who (or whose spouse) is
or has been an employee, officer, director, partner, legal counsel, consultant
to or agent of ITC, IDC or Licensee or any of their respective Affiliates shall
be deemed to be partial and to have a conflict of interest and may not be
appointed an arbitrator. Should an arbitrator die, resign, refuse to act, or
become incapable of performing his or her functions as an arbitrator, the AAA
may declare a vacancy on the Arbitral Tribunal. The vacancy shall be filled by
the method by which that arbitrator was originally appointed.

          (b) The parties shall request that the arbitrators conduct the
arbitration proceeding in an expedited fashion in order to complete the
proceeding within one (1) year of the date upon which the arbitration was
initiated under the AAA Institutional Rules. The parties shall use their best
efforts to cooperate with the arbitrators to complete the proceeding within such
one (1) year period. However, the Arbitral Tribunal may extend this period for
good cause shown.

          (c) The arbitration proceedings shall be governed by this Agreement,
the AAA International Rules, and by the procedural arbitration law of the site
of the arbitration, and by the United Nations Convention on the Recognition and
Enforcement of Foreign Arbitral Awards. The Arbitral Tribunal shall determine
the matters at issue in the Dispute in accordance with the substantive law of
the State of New York and U.S. Federal patent law, without regard to conflicts
of law principles. The Arbitral Tribunal shall decide the issues submitted as
arbitrators at law only and shall base its award, and any interim awards, upon
the terms of this Agreement and U.S. Federal patent law and the laws of the
State of New York. The Arbitral Tribunal is not empowered to and shall not act
as amiable compositeur or ex aequo et bono.

                                      -15-

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                                                     PRIVILEGED AND CONFIDENTIAL

          (d) The Arbitral Tribunal shall take into account applicable
principles of legal privilege and related protections, such as those involving
the confidentiality of communications between a lawyer and a client and the work
product of a lawyer, and no party or witness may be required to waive any
privilege recognized at law. The Arbitral Tribunal shall issue orders as
reasonably necessary to protect the confidentiality of proprietary information,
trade secrets, and other sensitive information disclosed.

          (e) Pursuant to a schedule to be established by the Arbitral Tribunal,
the parties shall exchange those documents upon which the producing party may
rely in support of any claim or defense. The parties may further exchange
documents in response to written requests for disclosure of non-privileged
documents directly relevant to the determination of the issues presented for
determination by the Arbitral Tribunal. Any dispute regarding such requests for
disclosure or the adequacy of any party's disclosures shall be determined by the
Arbitral Tribunal consistent with the expedited nature of arbitration.

          (f) Escrow. In the event of a Dispute, the party alleged to owe any
amount due under this Agreement ("Depositor") shall deposit into an interest
bearing account with a mutually agreed to independent escrow agent (appointed by
the Arbitration Panel in the event of a failure to agree), an amount equal to
[**] of the amount in dispute. The party requesting an escrow ("Claimant") shall
make a showing to the Arbitration Tribunal that there are facts to support the
claimed amount. The deposit of any escrow monies shall be made within thirty
(30) days from such date that the Arbitral Tribunal has declared that the
Arbitration proceedings have commenced. Notwithstanding the above, any amounts
payable under this Agreement which are not disputed shall be paid to the party
to which they are owed and not escrowed pending resolution of the arbitration
proceedings. The escrow agent shall be empowered to release any or all monies,
including accrued interest, from the escrow account:

               (i) to the Claimant only to the extent determined by a decision
     made by the Arbitral Tribunal; and

               (ii) to the Depositor any amount remaining upon resolution of all
     of the Claimants' claims; or

               (iii) as agreed to in writing and signed by each party.

          The parties shall share the cost of the escrow agent equally.

          (g) Awards. All awards shall be in writing and shall state the
reasoning upon which the award rests. Any award shall be made and signed by at
least a majority of the arbitrators. The Arbitral Tribunal is expressly
empowered to grant any remedy or relief available under the law, including but
not limited to specific performance of this contract or matters arising out of
or in connection therewith and injunctive relief against the unlicensed sale of
Covered Terminal Units. Judgment on the award may be entered in any court of
competent jurisdiction. Any judgment or order of specific performance shall be
enforceable, without opposition in any country. Both parties shall bear equally
the cost of the arbitration (exclusive of legal fees and expenses, all of which
each party shall bear separately). Any monetary award shall be payable in United
States dollars, free of any tax or other deduction. Any determination of the
arbitration shall be binding solely on the parties hereto. All Awards shall be
paid within ten (10) days of such Award as to escrowed funds and within thirty
(30) days of such Award as to non-escrowed amounts.

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                                                     PRIVILEGED AND CONFIDENTIAL

          (h) The failure or refusal of any party, having been given due notice
thereof, to participate at any stage of the dispute resolution proceedings shall
not prevent the proceedings from continuing, nor shall such failure or refusal
impair the validity of the award or cause the award to be void or voidable, nor
shall it be a basis for challenge of the validity or enforceability of the award
or of the arbitration proceedings. If any party fails to fund the escrow or to
timely pay an advance on fees and costs ordered by the Arbitral Tribunal or the
AAA within thirty (30) days after the date set for such deposit, that party
shall be deemed to be in default of the Arbitration. The Tribunal and/or the AAA
shall then determine whether the funds on deposit for fees and costs are
sufficient to satisfy the anticipated estimated expenses for the proceeding to
continue on an expedited basis without the participation of the defaulting
party. If so, the proceeding will continue without the participation of the
defaulting party, and the Tribunal may enter an award on default. Prior to
entering an award on default, the Tribunal shall require the non-defaulting
party to produce such evidence and legal argument in support of its contentions
as the Tribunal may deem appropriate. The Tribunal may receive such evidence and
argument without the defaulting party's presence or participation. If the funds
on deposit are deemed insufficient to satisfy the estimated costs of continuing
as provided herein, the non-defaulting party may make all or part of the
requested deposit in an amount sufficient to allow the proceeding to continue
without the participation of the defaulting party. If the non-defaulting party
chooses not to make the requested deposit, the Arbitral Tribunal may suspend or
terminate the proceedings.

          (i) Unless the parties agree otherwise, the parties, the
arbitrator(s), and the AAA shall treat the dispute resolution proceedings
provided for herein, any related disclosures, and the decisions of the Arbitral
Tribunal, as confidential, except in connection with judicial proceedings
ancillary to the dispute resolution proceedings, such as a judicial challenge
to, or enforcement of, the arbitral award, and unless otherwise required by law.

     6.5. Interim Measures from the Courts in Aid of Arbitration. At any time
after submission of a written notice of a Dispute, any party may request a court
of competent jurisdiction to grant interim measures of protection including
without limitation temporary, preliminary, and injunctive relief: (a) to prevent
the destruction of documents and other information or things related to the
Dispute, or (b) to prevent the wasting or hiding of assets. Such injunctive
relief shall be enforceable in any country and neither Licensee or Licensee's
Affiliates shall oppose such enforcement.

     6.6. Mandatory Procedures. The parties agree that any Dispute arising under
this Agreement shall be resolved solely by means of the procedures set forth in
this article, and that such procedures constitute legally binding obligations
that are an essential provision of this Agreement. If either party fails to
observe the procedures of this article, as may be modified by their written
agreement, the other party may bring an action for specific performance of these
procedures in any court of competent jurisdiction.

     6.7. Injunctive Relief. In the event Licensee fails to comply with an
Arbitral award, ITC shall be entitled (notwithstanding the other provisions of
this Agreement) to petition any court of competent jurisdiction for temporary,
preliminary and permanent injunctions against the exercise of the licenses
granted by this Agreement. Such injunctive relief shall be enforceable in any
country, and neither Licensee nor any Licensee Affiliate shall oppose such
enforcement. In any event, Licensee shall have at least thirty (30) days to
comply with any such award before ITC shall petition for any injunction.

     6.8. Performance to Continue. Licensee shall continue to perform its
undisputed obligations under this Agreement pending final resolution of any
Dispute arising out of or relating to this Agreement. Nothing in this article,
including the requirements to mediate and arbitrate Disputes, shall relieve
Licensee from its obligation to make undisputed Payments pursuant to Article III
of this Agreement during the pendency of such proceedings or delay ITC's right
to terminate this Agreement in accordance with Section 5.2.

                                      -17-

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                                                     PRIVILEGED AND CONFIDENTIAL

     6.9. Statute of Limitations. The parties agree that all applicable statutes
of limitation and time-based defenses (such as estoppel and laches) shall be
tolled while the procedures set forth in this Article VI are pending. The
parties shall cooperate in taking any actions necessary to achieve this result.

     6.10. Relief From Stay. Licensee, in the event Licensee becomes the subject
of a voluntary or involuntary petition in bankruptcy under the U.S. Bankruptcy
Code or any other insolvency statute, or any foreign counterpart thereof, hereby
consents to the applicable tribunal's grant of any ITC request of relief from
any stays, automatic or otherwise, or other orders, laws or regulations that may
limit ITC's rights to enforce the terms of this Agreement, including without
limitation the right to terminate this Agreement pursuant to Article V of this
Agreement for Licensee's breach. The parties agree that any Dispute under this
Agreement would not be a core proceeding under 28 U.S.C. Section 157, because,
inter alia, this Agreement was entered into prior to the commencement of any
bankruptcy proceeding and not in contemplation thereof. Therefore, in the event
a bankruptcy or similar insolvency proceeding is commenced by or against
Licensee, Licensee will continue to support and use best efforts to ensure the
arbitration of any Disputes arising under this Agreement as set forth herein.

                                  ARTICLE VII
                         REPRESENTATIONS AND WARRANTIES

     7.1. By ITC. ITC hereby represents and warrants that:

          (a) ITC is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Delaware and has authority to enter into
this Agreement and perform its obligations hereunder. This Agreement constitutes
a valid and binding agreement of ITC enforceable in accordance with its terms.
Neither the execution and delivery of this Agreement nor the consummation by ITC
of the transactions contemplated hereby, nor compliance by ITC with any of the
provisions hereof, will (i) constitute a violation of or default under any
contract, instrument, commitment, agreement, understanding, arrangement, or
restriction of any kind to which ITC is a party, or by which ITC may be bound,
or (ii) violate any rule, regulation, law, statute, ordinance, judgment, order,
writ, injunction, or decree of any court, administrative agency, or governmental
body applicable to ITC.

          (b) ITC has the right to license the ITC Patents. ITC represents that
it has not, within the four (4) year period prior to the Effective Date,
assigned, sold, or otherwise conveyed to any third party any patent or patent
application. ITC makes no other representation or warranty with regard to the
validity of the ITC Patents or Licensee's ability to design, develop, use,
manufacture, have manufactured, market, distribute or sell Covered Terminal
Units free of infringement of third party intellectual property rights. ITC
shall have no obligation to maintain or prosecute ITC Patents.

          (c) ITC shall not make any claim against Licensee or its Affiliates of
inducement to infringe or contributory infringement relating to any product or
component produced by third parties where the manufacture or sale of such
product or component may include technology provided by Licensee, or may have
otherwise been facilitated by Licensee or its Affiliates. Such agreement not to
assert claims shall be (i) personal to Licensee and its Affiliates, (ii) extend
to only Covered Terminal Units that, had they been manufactured by Licensee or
its Affiliates, would have been covered under the license granted herein, (iii)
not convey any license or any other rights to such third party, and (iv) not
prejudice or affect any infringement claim that ITC may have against such third
party.

                                      -18-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     7.2. By Licensee. Licensee is a corporation duly organized, validly
existing, and in good standing under the laws of Sweden and has authority to
enter into this Agreement and perform its obligations hereunder, and to cause
its Affiliates to perform their respective obligations hereunder. This Agreement
constitutes a valid and binding agreement of Licensee enforceable in accordance
with its terms. Neither the execution and delivery of this Agreement nor the
consummation by Licensee of the transactions contemplated hereby, nor compliance
by Licensee with any of the provisions hereof, will (i) constitute a violation
of or default under, any contract, instrument, commitment, agreement,
understanding, arrangement, or restriction of any kind to which Licensee is a
party, or by which Licensee may be bound, or (ii) violate any rule, regulation,
law, statute, ordinance, judgment, order, writ, injunction, or decree of any
court, administrative agency, or governmental body applicable to Licensee.

     7.3. By Both Parties.

          (a) Each party will take any and all actions necessary to ensure that
this Agreement shall become applicable to Acquired Businesses pursuant to
Section 3.6 herein and becomes applicable to Transferees pursuant to Section
8.14 herein.

          (b) Neither party shall present or submit this Agreement in whole or
in part or any summary thereof, in any mediation, arbitration, or legal
proceeding against the other party or its Affiliates except with respect to
Covered Terminal Units.

     7.4. Disclaimer. THE WARRANTIES AND REMEDIES SET FORTH IN THIS AGREEMENT
CONSTITUTE THE ONLY WARRANTIES WITH RESPECT TO THIS AGREEMENT AND THE SUBJECT
MATTER HEREOF, AND THEY ARE IN LIEU OF ALL OTHER WARRANTIES WRITTEN OR ORAL,
STATUTORY, EXPRESS, IMPLIED OR OTHERWISE, INCLUDING WITHOUT LIMITATION THE
IMPLIED WARRANTY OF MERCHANTABILITY AND THE IMPLIED WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE.

                                  ARTICLE VIII
                                  MISCELLANEOUS

     8.1. Confidentiality. Unless otherwise required by law, court order or by
the Court in connection with the Lawsuit, the parties shall maintain as strictly
confidential this Agreement and any proprietary information disclosed under, or
as a result of the negotiation or performance of, this Agreement, including
without limitation the terms of this Agreement (including the exhibits hereto).
Notwithstanding the foregoing, the parties agree that Licensee and ITC or
InterDigital may (i) issue a press release regarding the execution of this
Agreement, such press release to be reviewed and approved in advance by the
other party, such approval not to be unreasonably withheld or delayed and (ii)
respond to any questions relating to any confidential aspects of this Agreement
in a manner agreed upon by the Parties. For the avoidance of doubt, the
forecasts and reports Licensee submits pursuant to Article III of this Agreement
shall be deemed the proprietary information of Licensee. Notwithstanding the
foregoing, the parties agree that Licensee and ITC or InterDigital may (i)
disclose the contents or the principal terms of this Agreement in confidence to
other licensees only to the extent required by most favored licensee clauses and
to satisfy SEC, NASDAQ, London Exchange, Stockholm Stock Exchange or other
statutory, regulatory or administrative requirements, or to comply with a court
order, or in mediation, or arbitration between the parties pursuant to Article
VI herein, and (ii) disclose any other information necessary to satisfy SEC,
NASDAQ, London Exchange, Stockholm Stock Exchange or other statutory, regulatory
or administrative requirements, to comply with a court order, or in mediation,
or arbitration between the parties, Disclosures pursuant to subsection (ii) of
this Section 8.1 shall be subject to the other party's advance review and
comment, which comments shall not be unreasonably withheld or delayed.

                                      -19-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     8.2. Licensee Identification on Covered Terminal Units. If Licensee begins
patent marking Covered Terminal Units for other patent holders, Licensee shall,
and shall cause its Affiliates to, affix on all products, packaging or
instructions (or if practicable, the product itself) a label indicating that the
products are manufactured or sold under license from ITC. ITC may designate
certain ITC Patents for inclusion on such label.

     8.3. Headings. The headings of the several Articles and Sections are
inserted for convenience of reference only and are not intended to be part of or
affect the meaning or interpretation of this Agreement.

     8.4. Audit. Licensee shall (and shall cause its Affiliates to) keep books
and records adequate to accurately determine the Payments under this Agreement,
and retain such books and records for at least three (3) years after the
delivery of the Royalty report to which they relate. ITC shall have the right,
no more than once per calendar year, to have an independent certified public
accountant inspect all relevant books and records of Licensee and its Affiliates
on thirty (30) days' prior notice and during regular business hours to verify
the reports and Payments required to be made hereunder. Such independent
certified public accountant shall be selected by ITC and approved by Licensee.
Licensee shall respond to ITC's selection of auditor within ten (10) days and
its approval shall not be unreasonably withheld. The auditor shall enter into an
appropriate nondisclosure agreement with Licensee, and shall disclose no more
information than is reasonably necessary to determine the Payments owed
hereunder. Should an underpayment in excess of [**] be discovered, Licensee
shall pay the cost of the audit. In any event, Licensee shall promptly pay any
underpayment together with interest at the compounded annual rate of [**] from
the due date. All information obtained through such audit shall be deemed
Licensee confidential information and subject to the protections provided as per
Section 8.1 of this Agreement.

     8.5. Governing Law/Venue. The validity and interpretation of this Agreement
shall be governed by New York law and U.S. federal patent law, without regard to
conflict of laws principles. The parties further irrevocably consent to
exclusive jurisdiction of the state and federal courts in the State of New York
for the purposes of enforcement of any final award granted by the Arbitral
Tribunal. Such enforcement shall be governed by the laws of the State of New
York.

     8.6. Affiliate Performance. Each party shall be responsible for all actions
required of its Affiliates hereunder and shall be liable to the other party for
any adverse action or failure to perform by such party's Affiliates hereunder.

     8.7. Waivers. No waiver of any right, term or condition under this
Agreement shall be deemed effective unless in writing and signed by the party
charged with such waiver, and no waiver shall operate as a waiver of any future
such right, term or condition or any other right, term or condition arising
under this Agreement.

     8.8. Survival. All representations, acknowledgements, obligations,
responsibilities, terms or conditions involving performance subsequent to the
expiration or termination, repeal or rejection of this Agreement, or which
cannot be determined to have been fully performed until after such time, or
which by their nature are intended to survive shall be deemed to survive.
Without limitation, all payment obligations and acknowledgements herein and the
representations and warranties contained in Article VII hereof are intended to
survive and shall survive any such expiration or termination, repeal or
rejection.

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                                      -20-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     8.9. Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.

     8.10. Pre-Existing Rights Not Limited. Nothing in this Agreement shall be
construed as limiting the rights or granting rights which the Licensee has
outside the scope of the license granted hereunder, or restricting or granting
the right of Licensee or any of its Affiliates to make, have made, use, lease,
Sell or otherwise dispose of any particular product or products not herein
licensed.

     8.11. No Set Off. Licensee agrees and acknowledges that it has no right to,
and shall not, attempt to set off amounts claimed to be owed based on any claim
that it has or may have in the future against InterDigital, ITC, or any of their
respective Affiliates, except as specifically agreed to in writing by ITC,
against amounts owed hereunder.

     8.12. Notices. Any report, notice or other communication required or
permitted to be made or given to either party hereto pursuant to this Agreement
shall be sent to such party by registered airmail (except that registered or
certified mail may be used where delivery is in the same country as mailing),
postage prepaid, addressed to the respective party at its address as set forth
below, or to other such address as it shall designate by written notice given to
the other party, and shall be deemed to have been made, given or provided on the
date of receipt. The addresses:

          (a) For ITC:

               InterDigital Technology Corporation
               300 Delaware Avenue, Suite 527
               Wilmington, DE 19801

               with copy by facsimile to: (610)- 878-7844
               Attention: President

          (b) For Licensee:

               Sony Ericsson Mobile Communications AB
               202 Hammersmith Road
               London, England
               W6 7DN

               with copy by facsimile to: 44 208 762 5676
               Attention: Vice President Legal

     8.13. Limitation. Nothing in this Agreement shall be construed as: (a) an
agreement to bring or prosecute actions against third party infringers of the
ITC Patents; (b) conferring any license or right under any patent other than the
ITC Patents; or (c) conferring any right to use the ITC Patents outside the
field of use defined by the license grant of this Agreement.

                                      -21-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     8.14. Personal Agreement. This Agreement is personal to Licensee and,
except as provided for in this Section 8.14 or as ITC consents to in writing in
its sole discretion, may not be assigned or transferred, nor may any license
granted hereunder be assigned or transferred, whether by operation of law or
otherwise, and any attempt to make any such assignment or transfer shall be null
and void. Without limitation, the provisions of this Section 8.14 shall apply to
the sale or other transfer by Licensee or any Licensee Affiliate to an
unaffiliated third party any part of the business or substantial assets involved
in the manufacture, distribution or sale of Covered Terminal Units.

     Notwithstanding the aforesaid, if:

          (a) Licensee is acquired by (y) merger, consolidation or another
business combination, or (z) the sale 50% or more of its capital stock; or

          (b) Licensee or any Licensee Affiliate sells or otherwise transfers to
an unaffiliated third party (a "Transferee") any Affiliate, any part of the
business or substantial assets (or control over any of the foregoing) involved
in the manufacture, distribution or sale of Covered Terminal Units (the
"Transferred Business"), the following shall apply:

               (i) Without regard to whether ITC has previously licensed the
     Transferee to manufacture or sell Covered Terminal Units, if the
     Transferred Business remains in an entity separate from Transferee and its
     other affiliates, then the terms of this Agreement shall continue to apply
     to the Transferred Business and the terms of the Transferee's existing
     license shall govern the Transferee's existing business.

               (ii) If and to the extent the Transferee, immediately prior to
     the effective date of the transaction (the "Transfer Date), was licensed by
     ITC to manufacture or sell Covered Terminal Units and either the
     Transferred Business does not remain a separate entity or the Transferred
     Business' production facilities are merged into the Transferee or one of
     its affiliates, then [**]

          (c) If and to the extent the Transferee, prior to the Transfer Date,
is not licensed by ITC to manufacture and sell Covered Terminal Units and the
Transferred Business does not remain a separate entity or the Transferred
Business' production facilities are merged into the Transferee or one of its
affiliates, then [**]

     8.15. Entire Agreement/Amendment. To the extent Licensee is licensed under
another patent license agreement with ITC under standards or covering products
that differ from the Covered Standards or Covered Terminal Units, the other
patent license agreement shall remain in full force and effect as to those
differing standards and/or products. To the extent Licensee was licensed under
another patent license agreement with ITC prior to the Effective Date for the
Sale of Covered Terminal Units, the terms of that prior agreement shall continue
to apply up to but not including the Effective Date including any cross licenses
back to InterDigital. Otherwise, this Agreement, contains the complete and final
agreement between the parties, and supersedes all previous understandings,
relating to the subject matter hereof whether oral or written. This Agreement
may only be modified by a written agreement signed by duly authorized
representatives of the parties.

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                                      -22-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

     8.16. Counterparts. This Agreement may be executed in counterparts, which
taken together, shall constitute one Agreement and each party hereto may execute
this Agreement by signing such counterpart, provided that no party shall be
bound hereby until it has been executed and delivered by all parties hereto. A
facsimile signature of either party to this Agreement, or any amendment of this
Agreement, shall be deemed an original signature of such party and shall
manifest such party's intention to be bound by this Agreement or such amendment.

     8.17. Limitation of Liability. IN NO EVENT, WHETHER AS A RESULT OF BREACH
OF CONTRACT, A WARRANTY, TORT LIABILITY (INCLUDING NEGLIGENCE) OR OTHERWISE
SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY SPECIAL, CONSEQUENTIAL,
INCIDENTAL, INDIRECT OR EXEMPLARY DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOSS
OF PROFITS, LOSS OF REVENUES OR LOSS OF CAPITAL.

                                   ARTICLE IX
                                     RELEASE

     ITC on behalf of itself and InterDigital, and their respective Affiliates
as of the Effective Date of this Agreement, hereby irrevocably releases except
for failure to remit payments required under 3.1(a) and 3.1(b), Licensee, its
Affiliates, and their customers, including any customers in the chain of
possession of Covered Terminal Units, from any and all claims from infringement
of ITC Patents (including method claims), which claims have been made, or which
might be made at any time, with respect to any Covered Terminal Units or
components used therein, manufactured, used, leased, Sold or otherwise
transferred by or for Licensee or its Affiliates before the Effective Date of
this Agreement.

     IN WITNESS WHEREOF, the parties have executed this Agreement by their duly
authorized representatives.

INTERDIGITAL TECHNOLOGY CORPORATION     SONY ERICSSON MOBILE COMMUNICATIONS AB


By: /s/ William J. Merritt             By: /s/ Per Hendar
    --------------------------------       -------------------------------------
Name:  William J. Merritt               Name:  Per Hendar
Title: President                        Title: Corporate Vice President
Date:  March 10, 2003                   Date:  2003/03/10

                                      -23-

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT A

                                   AFFILIATES

Sony Ericsson Mobile Communications AB

Sony Ericsson Mobile Communications International AB

Sony Ericsson Mobile Communications Japan Inc.

Sony Ericsson Mobile Communications (USA) Inc.

Sony Ericsson Mobile Communications do Brazil Ltd.

Sony Ericsson Mobile Communications S.A. de C.V.

Sony Ericsson Mobile Communications S.p.A.

Sony Ericsson Mobile Communications Ltd.

Sony Ericsson Mobile Communications China

Sony Ericsson Mobile Communications Management Ltd.

                                      A-1

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT B

                       CALCULATION OF PREPAYMENT DISCOUNT

                         (Page Intentionally Left Blank)

                                      B-1

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT C
                               ROYALTY PREPAYMENT
                            COVERED SUBSCRIBER UNITS

SAMPLE CALCULATION

[**]

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                                      C-1

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT D
                          ROYALTY PREPAYMENT EXHAUSTION
                            COVERED SUBSCRIBER UNITS

SAMPLE CALCULATION

[**]

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                                      D-1

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT E
                               PDC ROYALTY CREDIT
                            COVERED SUBSCRIBER UNITS

SAMPLE CALCULATION

[**]

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                                      E-1

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT F
                          PDC ROYALTY CREDIT EXHAUSTION
                            COVERED SUBSCRIBER UNITS

SAMPLE CALCULATION

[**]

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                                      F-1

<PAGE>

                                                     PRIVILEGED AND CONFIDENTIAL

                                  ATTACHMENT G
                    ROYALTY PREPAYMENT OVER FOUR YEAR PERIOD
                            COVERED SUBSCRIBER UNITS

SAMPLE CALCULATION

[**]

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                                      G-1