Document:

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                                                                   Exhibit 10.11

SpeechWorks International, Inc. has omitted from this Exhibit 10.11 portions of
the Agreement for which SpeechWorks International, Inc. has requested
confidential treatment from the Securities and Exchange Commission. Omitted
language is indicated by brackets (i.e. [ ]). The portions of the Agreement for
which confidential treatment has been requested have been filed separately with
the Securities and Exchange Commission.

AT&T AND SPEECHWORKS PROPRIETARY

                       DEVELOPMENT AND LICENSE AGREEMENT

                                    BETWEEN

                                   AT&T CORP.

                                      AND

                        SPEECHWORKS INTERNATIONAL, INC.

                                  JUNE 5, 2000

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                       DEVELOPMENT AND LICENSE AGREEMENT

          THIS DEVELOPMENT AND LICENSE AGREEMENT (the "AGREEMENT") is made
effective as of June 5, 2000, (the "EFFECTIVE DATE") by and between AT&T Corp.,
a New York corporation with offices at 32 Avenue of the Americas, New York, New
York 10013-2412, USA ("AT&T"), and SpeechWorks International, Inc., a Delaware
corporation with offices at 695 Atlantic Avenue, Boston, Massachusetts 02111,
USA ("SPEECHWORKS").

          AT&T has developed certain speech processing application programmer's
interface software tools.

          SpeechWorks desires to license certain AT&T speech technology, to
develop speech recognition software incorporating such speech technology and to
make this software available for license by AT&T and others, as more fully
described in this Agreement.

          This Agreement consists of this signature sheet, the Terms and
Conditions ("TERMS AND CONDITIONS") attached to this signature sheet, any
addenda attached to this Agreement as provided in the Terms and Conditions, and
the following Exhibits attached hereto.

          Exhibit A   AT&T Speech Software

          Exhibit B   SpeechWorks Speech Software

          Exhibit C   Statement of Work

          Exhibit D   AT&T Branding Guidelines

          Exhibit E   Equity Consideration

          Exhibit F1  Specified AT&T Competitors

          Exhibit F2  Specified SpeechWorks Competitors

          Exhibit G   Marketing Plan

          Exhibit H   Support and License Fees

                                       1.
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          Exhibit I   Minimum End User License Terms

          Exhibit J   Form of Source Code Escrow Agreement

          Exhibit K   Form of Joint Press Release

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

AT&T CORP.                             SPEECHWORKS INTERNATIONAL, INC.
By:    /s/ David C. Nagel              By:    /s/ Stuart R. Patterson
    ---------------------------------      ------------------------------------
Name:  David C. Nagel                  Name:  Stuart R. Patterson
     --------------------------------        ----------------------------------
Title: Chief Technology Officer        Title: Chief Executive Officer
       ------------------------------         ---------------------------------

                    THIS DOCUMENT DOES NOT BIND OR OBLIGATE

                 EITHER PARTY IN ANY MANNER UNLESS EXECUTED BY

                   AUTHORIZED REPRESENTATIVES OF BOTH PARTIES

                                       2.
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                              TERMS AND CONDITIONS
1.  DEFINITIONS

          Capitalized terms in this Agreement, including those in the Exhibits,
have the meanings set forth below or defined elsewhere in this Agreement.  All
references to Sections and Exhibits in this Agreement are to Sections of and
Exhibits attached to this Agreement.

          "AFFILIATE" means a corporation or other entity that controls, is
controlled by, or is under common control with another corporation or entity,
but only while that control relationship exists; "control" means the direct or
indirect ownership or control of 50% or more of the stock or other equity
interest entitled to vote for the election of directors or equivalent governing
body.  AT&T Affiliates shall also include [     ], [     ] and [     ] and
exclude [     ] even if such entity would otherwise qualify as an AT&T Affiliate
under this definition.

          "ALPHA VERSION" means a pre-release version of an anticipated
commercial Software product that is released for internal, but not external,
testing.
          "APPLICATION" means Software designed to perform a specific function
directly for the user or, in some cases, for another application program.

          "AT&T BRANDED SERVICES" means any service provided to end users,
whether individuals, businesses or other persons, entities or organizations,
under a brand name owned by AT&T or any of its Affiliates for which AT&T or any
of its Affiliates is responsible for billing end users.

          "AT&T BUSINESS UNIT" means an operating unit of AT&T or of an AT&T
Affiliate.

          "AT&T IPR" means any IPR owned by AT&T or under which AT&T has the
right to grant licenses to SpeechWorks of the scope granted in this Agreement
without the consent of any third party (i) without payment of royalties or other
license fees to a third party

                                       1.
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during the term of this Agreement, or (ii) with payment of royalties or other
license fees to a third party during the term of this Agreement, provided that
SpeechWorks agrees to reimburse AT&T for such royalties or other license fees
attributable to the licensing of such AT&T IPR to SpeechWorks.

          "AT&T LABS" means the current AT&T Labs business unit within AT&T and
the successors of such business unit.

          "AT&T LABS TRADEMARK" shall mean the AT&T Labs trademark designated in
EXHIBIT D.

          "AT&T SPEECH SOFTWARE" means the speech processing application
programmer's interface software tools owned by AT&T as of the Effective Date
specified in EXHIBIT A.

          "AT&T SPEECH TECHNOLOGY" means (a) AT&T Speech Software, (b) the AT&T
TTS Software, (c) any other AT&T IPR existing as of the Effective Date relating
to the perception and processing by a machine of human speech that enables
automatic speech recognition (ASR) (including large vocabulary recognition),
natural language understanding (NLU), dialog management (DM), speaker
verification (SV), and speaker identification (SI), including but not limited to
any such AT&T IPR that is embodied or necessarily infringed by implementation of
the AT&T Speech Software or the AT&T TTS Software, (d) improvements or
enhancements to any of the foregoing, if any, (collectively "ENHANCEMENTS") that
AT&T decides in its sole discretion to provide to SpeechWorks under Section 2.4,
and (e) bug fixes and error corrections in any of the foregoing Software
developed by AT&T during the term of this Agreement, excluding in all cases
Training Data that are not incorporated into the AT&T Speech Software.  If third
party IPR is licensed to AT&T Labs as of the Effective Date relating to

                                       2.
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perception of and processing by a machine of human speech that enables automatic
speech recognition (ASR) (including large vocabulary recognition), natural
language understanding (NLU), dialog management (DM), speaker verification (SV),
and speaker identification (SI) and if under the terms of such license AT&T may,
with the consent of such third party licensor, grant licenses to third parties
of the scope granted in this Agreement, then if so requested by SpeechWorks,
AT&T will either request such consent or allow SpeechWorks to request such
consent.  If such consent of the third party licensor is obtained, such third
party IPR shall be included within the definition of "AT&T Speech Technology"
for purposes of this Agreement, provided that SpeechWorks agrees to reimburse
AT&T for any incremental royalties or other incremental license fees (or any pro
rata portions of any fixed royalties or fixed license fees) attributable to the
licensing of such third party IPR to SpeechWorks.

          "AT&T TTS SOFTWARE" means the source code and object code versions of
the application programmer's interface software tools known as AT&T TTS Version
1.4 related to the conversion of text to speech.

          "AT&T TRADEMARKS" is defined in Section 5.1.

          "BETA VERSION" means a pre-release version of an anticipated
commercial Software product that is released externally to third parties for
testing and evaluation.

          "CONFIDENTIAL INFORMATION" is defined in Section 13.1.

          "DESIRED FUNCTIONALITY" is defined in Section 2.1.

          "DISCLOSER" is defined in Section 13.2.

          "ENHANCEMENTS" is defined in the definition of AT&T Speech Technology.

          "FAIR MARKET VALUE" is defined in Section 10.2.

                                       3.
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          "INDEPENDENTLY DEVELOPED IRP" means, for each party, all IPR (a) owned
by that party as of the Effective Date or (b) developed by or for that party
after the Effective Date.

          "INITIAL TERM" is defined in Section 16.1.

          "IPR" means all intellectual property rights protectable by law
anywhere throughout the world other than trademark rights, but including: all
copyrights (including any right to reproduce, distribute copies of, display or
perform, or prepare derivative works based on a copyrighted work), copyright
registrations and associated applications; Patents; mask work rights; trade
secrets; moral rights; author's rights; other rights in inventions, Software,
know-how, specifications, algorithms and databases; and all other intellectual
property rights as may exist now or hereafter come into existence, and all
renewals and extensions thereof and applications therefor, regardless of whether
any of such rights arise under the laws of the United States or of any other
state, country, or jurisdiction.

          "MARKS" are defined in Section 17.8.

          "PATENTS" means all patentable inventions and all patent rights
therefor, which include the right to apply for patent protection and all
associated patent applications, including the right to claim priority under
applicable international conventions, in any country in the world.

          "RECIPIENT" is defined in Section 13.2.

          "RENEWAL PERIOD" is defined in Section 16.1.

          "SOFTWARE" means any source or object code instructions for
controlling the operation of a central processing unit or computer, together
with associated supporting documentation, if any, describing such code, its
installation or operation.

          "SPECIFIED AT&T COMPETITOR(S)" means any entity listed in EXHIBIT F1
and any successor thereto.

                                       4.
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          "SPECIFIED SPEECHWORKS COMPETITOR(S)" means any entity listed in
EXHIBIT F2 and any successor thereto.

          "SPEECHWORKS INTEGRATED SPEECH PRODUCT" means Software developed by or
for  SpeechWorks during the term of this Agreement that incorporates any AT&T
Speech Technology and any documentation for the foregoing.  SpeechWorks
Integrated Speech Product may include third party software licensed by
SpeechWorks and incorporated by or for SpeechWorks into such SpeechWorks
Integrated Speech Product.

          "SPEECHWORKS IPR" means any IPR owned by SpeechWorks or generally
licensable by SpeechWorks to third parties.

          "SPEECHWORKS SPEECH SOFTWARE" means all Software owned by SpeechWorks
as of the Effective Date, and all Software developed by or for SpeechWorks
during the term of this Agreement, related to enabling the perception by a
machine of human speech, the conversion of speech to text or text to speech, and
the establishment of the meaning of speech so as to enable the machine to
respond to the intentions of the speaker including any of the Software described
in EXHIBIT B, and any enhancements or improvements thereto developed by or for
SpeechWorks during the term of this Agreement, including without limitation the
SpeechWorks Integrated Speech Product.  SpeechWorks Speech Software includes any
SpeechWorks IPR embodied or necessarily infringed by any implementation of any
of the foregoing Software.  SpeechWorks Speech Software excludes any custom
software developed by or for SpeechWorks under contract for a specific
SpeechWorks customer and licensed to such customer; provided that SpeechWorks
shall use commercially reasonable efforts, taking into consideration the type
and volume of application, to incorporate the most advanced versions of its
Software into the SpeechWorks Speech Software licensed to AT&T and its
Affiliates pursuant to this Agreement.

                                       5.
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          "STATEMENT OF WORK" is defined in Section 2.1.

          "SUPPORT SERVICES" is defined in Section 7.1.

          "TERRITORY" means any country in the world to which the AT&T Speech
Technology can be lawfully exported.

          "TRAINING DATA" means  the audio input to Software resulting from end
users whether in a pilot, trial or production use of the Software.

          "TRIGGER EVENT" is defined in Section 10.2.

2.   DEVELOPMENT OF SPEECHWORKS INTEGRATED SPEECH PRODUCT

     2.1  INITIAL STATEMENT OF WORK. AT&T and SpeechWorks have agreed on an
initial Statement of Work attached hereto in EXHIBIT C (the "STATEMENT OF
WORK").  Within [     ] of delivery by AT&T to SpeechWorks of the AT&T Speech
Software as it exists as of the Effective Date, SpeechWorks shall allocate at
least [     ] developers who will dedicate at least [     ] percent ([     ]%)
of their time to beginning the process of producing a SpeechWorks Integrated
Speech Product with the initial desired functionality specified in the Statement
of Work (the "DESIRED FUNCTIONALITY").  If within [     ] ([     ]) [     ] of
the Effective Date SpeechWorks and an AT&T Business Unit or a customer of an
AT&T Business Unit agree on an order for a SpeechWorks Integrated Speech Product
incorporating some or all of the Desired Functionality, SpeechWorks shall
proceed to produce such SpeechWorks Integrated Speech Product in accordance with
such order.  If no such order is agreed upon within such [     ] ([     ]) [
] period, SpeechWorks shall have no obligation under this Section 2.1 to produce
a SpeechWorks Integrated Speech Product incorporating some or all of the Desired
Functionality.  Unless SpeechWorks has entered into a contract with an AT&T
Business Unit or a customer of an AT&T Business Unit committing to include
specified components in a SpeechWorks Integrated Speech Product, the final
determination of what components are integrated into a SpeechWorks Integrated
Speech Product and the schedule of such integration shall be determined by
SpeechWorks.  The provisions of the Statement of Work shall not serve to amend
or change any of the provisions of these Terms and Conditions and shall be
construed so as to be fully consistent with all of the provisions of these Terms
and Conditions.  In the event of any conflict or inconsistency between the
Statement of Work and the Terms and Conditions of this Agreement, the Terms and
Conditions of this Agreement shall govern.  The Statement of Work may only be
amended as provided in Section 17.13 of these Terms and Conditions.

     2.2  SUBSEQUENT AGREEMENTS WITH AT&T BUSINESS UNITS.  With respect to each
deployment of the SpeechWorks Integrated Speech Product by an AT&T Business
Unit, SpeechWorks and either that AT&T Business Unit or a third party systems
integrator designated by that AT&T Business Unit, and reasonably acceptable to
SpeechWorks, shall enter into a new statement of work.  This new statement of
work shall provide for the terms of the applicable deployment including, as
appropriate, (i) a specific deployment schedule, (ii) delivery and

                                       6.
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acceptance criteria, (iii) functional requirements of such deployment, (iv)
performance metrics for the SpeechWorks Integrated Speech Product, and
maintenance and performance metrics for SpeechWorks, (v) a detailed agreement on
the financial terms of such deployment, and (vi) other terms such as the AT&T
Business Unit (and/or such third party systems integrator) and SpeechWorks may
agree upon. Instead of entering into a new statement of work with the
aforementioned provisions, an AT&T Business Unit may formulate its own agreement
to be agreed to by SpeechWorks to cover a deployment of the SpeechWorks
Integrated Speech Product. Regardless of whether a particular deployment is
governed by a statement of work or an agreement, the provisions of this
Agreement regarding licensing and support shall apply, including Sections 4, 6
and 7. Also, the AT&T Business Unit deploying the SpeechWorks Integrated Speech
Product shall provide SpeechWorks with reasonable compensation, to be mutually
agreed by SpeechWorks and such AT&T Business Unit, for any professional services
provided by SpeechWorks for such deployment; provided that (a) such compensation
shall be charged at a rate [    ] charged by SpeechWorks to [    ] for [    ]
services and shall in no event exceed the rates specified in Exhibit H, and
(b) in no event shall such charges include charges for productizing such
Speechworks Integrated Speech Product.

     2.3  DEVELOPMENT RESOURCES.  Except as otherwise expressly provided in this
Agreement, each party shall bear its respective costs in developing the
SpeechWorks Integrated Speech Product and shall fully fund and pay for the costs
and expenses of the performance of the activities or actions for which such
party is responsible under this Agreement, including (i) the salary, employee
benefits and other overhead costs for its employees and facilities; (ii) any
personal or travel expenses of its own personnel; and (iii) costs for any
consultants whose use is not mutually agreed to by both parties.

     2.4  DELIVERY OF AT&T SPEECH TECHNOLOGY.

          2.4.1  EXISTING AT&T SPEECH TECHNOLOGY.  Within [     ] [(     )]
[   ] after the Effective Date AT&T shall begin, and within [     ] [(     )]
[   ] after the Effective Date AT&T shall complete, delivery to SpeechWorks the
AT&T Speech Software as it exists on the Effective Date. To effectuate the
delivery of other AT&T Speech Technology, that technology may, as AT&T
reasonably deems appropriate, be delivered in a variety of forms including
speech software in source code or object code form, written reports, or
consultation with members of AT&T Labs, provided that the initial delivery of
Software shall be in the form of a CD ROM.

          2.4.2  ENHANCEMENT.  Notwithstanding anything in this Agreement to the
contrary, AT&T shall not be obligated to enhance or improve the AT&T Speech
Technology after the Effective Date.  If AT&T in its sole discretion develops
any Enhancements, AT&T shall not be obligated to provide those Enhancements to
SpeechWorks.  If AT&T in its sole discretion elects to provide those
Enhancements to SpeechWorks, the circumstances, if any, pursuant to which AT&T
will provide such Enhancements to SpeechWorks and the applicable business terms,
shall be subject to a separate agreement to be negotiated by the parties,
provided, however, if AT&T delivers Software containing Enhancements to
SpeechWorks, such Enhancements shall be deemed to be included with AT&T Speech
Technology licensed under this Agreement unless such Software is identified by
AT&T on or prior to such delivery as being delivered for evaluation purposes
only or other similar designation.  AT&T and SpeechWorks agree that upon request
they will hold periodic research level meetings with each other to discuss

                                       7.
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as each party deems appropriate their respective research and development
activities with respect to speech technology.

     2.5  ALPHA TESTING OF THE SPEECHWORKS INTEGRATED SPEECH PRODUCT. AT&T shall
receive a [     ] license to the Alpha Version of the initial release of the
SpeechWorks Integrated Speech Product, for testing and demonstration development
purposes only, within [     ] ([     ]) [     ] of it becoming available within
SpeechWorks.  SpeechWorks may license such Alpha Version to third parties
provided that the AT&T [     ] within [     ] ([     ]) [     ] after AT&T
receives notice from SpeechWorks in writing of its intent to deliver such Alpha
Version to a third party.  It will be reasonable for AT&T to raise such
objection if the Alpha Version is to be delivered to [     ] or any supplier to
[     ] or if AT&T determines in its reasonable discretion that [     ] to
perform alpha testing would [     ].  The Alpha Version of the SpeechWorks
Integrated Speech Product shall be delivered to AT&T in compiled binary code
form.  SpeechWorks is not obliged to provide, and AT&T is not obliged to
purchase, support for the Alpha Version of the SpeechWorks Integrated Speech
Product.  In the event that AT&T provides any Enhancements to SpeechWorks under
Section 2.4, AT&T shall have the right to receive a royalty-free license to the
Alpha Version of the initial release of the SpeechWorks Integrated Speech
Product incorporating such Enhancements, for testing and demonstration
development purposes only, in compiled binary code form, within [     ]
[(    )] [     ] of it becoming available within SpeechWorks.

     2.6  BETA TESTING OF SPEECHWORKS INTEGRATED SPEECH PRODUCT. AT&T shall
receive a [     ] license to the Beta Version of any release of any SpeechWorks
Speech Software, for testing and demonstration development purposes only, no
later than, and on [     ] terms than any third party.  SpeechWorks shall not
deliver the initial Beta Version of the SpeechWorks Integrated Speech Product
incorporating [     ] and [     ] or the initial Beta Version of the SpeechWorks
[     ] incorporating [     ] with a [     ] greater than [     ] to [     ] (or
to a supplier of [     ] [     ] for testing or evaluation by [     ] [     ])
unless AT&T has access to such Beta Version for at least [     ] ([     ])
[    ] before such Beta Version is delivered to [     ] [     ] or supplier, or
unless AT&T [     ].  Such [     ] shall not be [     ] unless AT&T determines
in its reasonable discretion that allowing that party to perform beta testing
would [     ] AT&T [     ].  AT&T may, at its sole discretion, obtain support
for the Beta Version of any SpeechWorks Speech Software from SpeechWorks on no
less favorable terms than are offered to any third party.

     2.7  CONTINUED DEVELOPMENT OF THE SPEECHWORKS INTEGRATED SPEECH PRODUCT.
SpeechWorks shall use commercially reasonable efforts to continue to enhance and
improve the SpeechWorks Integrated Speech Product throughout the Term of this
Agreement and to provide any such enhancements or improvements to AT&T at AT&T's
request.  Upon the commercial release of each SpeechWorks Integrated Speech
Product during the term of this Agreement, at AT&T's request SpeechWorks shall
deliver a copy in compiled binary code form of that SpeechWorks Integrated
Speech Product, along with any relevant documentation, to AT&T for evaluation
and for the purposes set forth in Section 4.2.1.

     2.8  SOURCE CODE ESCROW. Within thirty days of the execution of this
Agreement, AT&T and SpeechWorks shall execute a source code escrow and license
agreement substantially in the form of EXHIBIT J with appropriate modifications
to conform to the terms of this

                                       8.
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Agreement. Each time SpeechWorks delivers a copy of a SpeechWorks Integrated
Speech Product under Section 2.7, SpeechWorks shall, at its expense, place a
copy of the source code of the SpeechWorks Integrated Speech Product, along with
source code comments and all relevant documentation, into escrow. In the event
of a Trigger Event where the Acquiring Entity is a Specified AT&T Competitor as
specified in Section 10.2, the source code will be released to AT&T and AT&T
shall be entitled to exercise the license to such source which is specified in
Section 10.2 and the source code escrow and license agreement.

     2.9  ACCESS TO SOURCE CODE FOR AT&T DESIGNATED THIRD PARTIES. AT&T may,
from time to time, request that SpeechWorks disclose and license the source code
of the SpeechWorks Integrated Speech Product to a third party on terms mutually
acceptable to SpeechWorks and such third party to the extent required for
developing and/or supporting AT&T Branded Services.  SpeechWorks shall not
unreasonably deny such a request by AT&T.  Reasons for such denial shall
include, but not be limited to, SpeechWorks' concern about giving access to
source code to a Specified SpeechWorks Competitor.  The license granted the
third party shall also allow the third party to use, modify, and prepare
derivative works based on the source code of the SpeechWorks Integrated Speech
Product to the extent required for developing and supporting AT&T Branded
Services and include reasonable provisions to protect SpeechWorks IPR including
ownership of derivative works.  SpeechWorks shall be reasonably compensated for
the license granted to the third party in an amount to be mutually agreed upon
by SpeechWorks and such third party.

3.   OWNERSHIP OF INTELLECTUAL PROPERTY

     3.1  INDEPENDENTLY DEVELOPED IPR.  As between AT&T and SpeechWorks, each
party shall own all right, title and interest in its respective Independently
Developed IPR, regardless of whether such Independently Developed IPR existed
prior to the Effective Date or is developed by that party subsequent to the
Effective Date.  Each party's rights with respect to its Independently Developed
IPR shall be subject to any IPR owned by the other party.  Without limiting the
generality of the foregoing, each party shall own any derivative works or
enhancements it develops during the term of this Agreement.  Nothing in this
Agreement shall be deemed or construed to grant any title or interest in or to
the other party's Independently Developed IPR, whether by implication, estoppel
or otherwise, except for the licenses granted within this Agreement.

     3.2  NO JOINTLY DEVELOPED IPR.  The parties do not intend, as of the
Effective Date, to conduct joint development.  Nevertheless, if the parties
later determine that they wish to conduct joint development, whether in
connection with a deployment with an AT&T Business Unit or otherwise, the
parties shall enter into a separate agreement that expressly provides for the
terms and conditions of such joint development, including provisions dealing
with access to source code and ownership of such joint development.

                                       9.
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4.   LICENSES

     4.1  LICENSE GRANTS BY AT&T.

          4.1.1  AT&T Speech Technology.

                 (a) DEVELOPMENT LICENSE. Subject to the terms and conditions of
this Agreement, AT&T hereby grants to SpeechWorks a non-exclusive, non-
transferable, royalty-free and perpetual license, under any AT&T Speech
Technology, to use, reproduce, make, have made, modify and prepare derivative
works based upon the AT&T Speech Technology solely for purposes of developing,
testing, maintaining and supporting the SpeechWorks Integrated Speech Product in
the Territory in any manner permissible under this Agreement.

                 (b) DISTRIBUTION LICENSE FOR COMPILED BINARY FORM. Subject to
the terms and conditions of this Agreement, AT&T hereby grants to SpeechWorks a
non-exclusive, non-transferable, royalty-free and perpetual license, under any
AT&T Speech Technology, (i) to use, reproduce, publicly display and publicly
perform the AT&T Speech Technology, or derivatives thereof, to the extent
embodied in Software and incorporated in any SpeechWorks Integrated Speech
Product, in compiled binary form, (ii) to distribute the AT&T Speech Technology,
or derivatives thereof, to the extent embodied in Software and incorporated in
any SpeechWorks Integrated Speech Product in the Territory, in compiled binary
form only, directly to end users and indirectly to end users through channels of
distribution and (iii) to sublicense the foregoing rights, through multiple
channels of distribution, to system integrators and value added resellers of any
SpeechWorks Integrated Speech Products.

                 (c) DISTRIBUTION LICENSE FOR SOURCE CODE. Subject to the terms
and conditions of this Agreement, AT&T hereby grants to SpeechWorks a non-
exclusive, non-transferable, royalty-free and perpetual license, under any AT&T
Speech Technology, (i) to deliver the AT&T Speech Technology, or derivatives
thereof, to the extent embodied in the Software and incorporated in any
SpeechWorks Integrated Speech Product, in the Territory, in source code form,
directly to end users and to system integrators and value added resellers of
SpeechWorks Integrated Speech Products solely for purposes of developing,
testing, maintaining and supporting SpeechWorks Integrated Speech Products and
(ii) to sublicense such end users, system integrators and value-added resellers
to use, reproduce and modify such source code solely for purposes of developing,
testing, maintaining and supporting SpeechWorks Integrated Speech Products,
subject to the following conditions: (A) SpeechWorks shall not provide source
code to [ ] unless AT&T consents in writing, such consent not to be unreasonably
withheld; (B) if SpeechWorks distributes a SpeechWorks Integrated Speech Product
containing source code of or derived from AT&T TTS Software, AT&T "Finite State
Machine" libraries greater than 100,000 words, AT&T dialog management and
natural language understanding, or AT&T speaker identification or speaker
verification, then AT&T shall be entitled to a reasonable share of any source
code license fee received by SpeechWorks with respect to such SpeechWorks
Integrated Speech Product in an amount to be mutually agreed by AT&T and
SpeechWorks, provided that AT&T's share shall in no event be greater than (x) [
] percent ([ ]%) in the case of [ ] distributed during [ ] after the Effective
Date that includes [ ], or (y) [ ] percent ([ ]%) in all other cases; and (C)
such source code shall be delivered pursuant to a written agreement with such
end user, system integrator or value-added-reseller containing reasonable
provisions to protect AT&T IPR and the confidentiality of the source code at
least as protective as the provisions under which SpeechWorks licenses source
code for its other SpeechWorks Speech Software. The foregoing notwithstanding,
SpeechWorks shall have the right in the ordinary course of business to put
source code for SpeechWorks Integrated Speech Products in escrow for the benefit
of any Specified AT&T Competitor or any other third party granted a binary code
license to such

                                      10.
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software under Section 4.1.1(b) above and to authorize the release of such
source to such Specified AT&T Competitor or other third party in accordance with
the terms of such escrow agreement substantially the same as those contained in
EXHIBIT J.

                 (d) END USER LICENSES. All copies of any SpeechWorks Integrated
Speech Product sublicensed by SpeechWorks (or by any system integrator or
reseller) to any third party shall be distributed with and subject to the
minimum terms and conditions of an end-user license substantially in the form of
EXHIBIT I.

          4.1.2  TRADEMARK LICENSE.  Subject to the terms and conditions of this
Agreement, AT&T hereby grants to SpeechWorks a non-exclusive, non-transferable,
[     ] license to use and reproduce the AT&T Trademarks in products utilizing
the AT&T Speech Technology, including related packaging, documentation, and
promotional materials.

     4.2  LICENSE GRANTS BY SPEECHWORKS FOR SPEECHWORKS INTEGRATED SPEECH
          PRODUCT.

          4.2.1  DEVELOPMENT, SUPPORT, AND DEMONSTRATION LICENSE.  Subject to
the terms and conditions of this Agreement, SpeechWorks hereby grants to AT&T
and its Affiliates a non-exclusive, non-transferable, royalty-free, perpetual
license, under any SpeechWorks Speech Software, to make, reproduce, use,
publicly display and publicly perform an unlimited number of copies of any
SpeechWorks Speech Software and related documentation on computer facilities
operated by or on behalf of AT&T or its Affiliates in the Territory in compiled
binary code form, for research, development, support and demonstration purposes
and not for any other commercial purposes.

          4.2.2  COMMERCIAL DEPLOYMENT LICENSES. Subject to the terms and
conditions of this Agreement, SpeechWorks agrees that, upon request from time to
time during the term of this Agreement, it shall grant to AT&T and any of its
Affiliates licenses, under any SpeechWorks Speech Software, to reproduce, use,
publicly display and publicly perform any SpeechWorks Speech Software and
related documentation, alone or as part of other Software, on computer
facilities owned and operated by or on behalf of AT&T or its Affiliates in the
Territory, in compiled binary code form, for purposes of providing commercial
services directly and through channels of distribution, to third parties without
limitation on the number of ports which may be licensed by AT&T, subject to
payment for the applicable license fees specified in Section 6.2 and agreement
between SpeechWorks and the applicable AT&T Business Unit upon appropriate
license terms consistent with the term of this Agreement applicable to such
license and other mutually agreeable terms.

          4.2.3 SUBLICENSING. The licenses granted under Section 4.2.1 include,
and the licenses to be granted under Section 4.2.2 will include, the right to
sublicense the rights under such licenses only to third parties to whom AT&T or
its Affiliates outsources the provisioning of AT&T Branded Services or to whom
AT&T and its Affiliates contract for the development, deployment or provisioning
of AT&T Branded Services including systems integrators and platform developers,
provided that (i) AT&T shall provide notice to SpeechWorks of such sublicenses;
(ii) AT&T shall pay the applicable license fees under Section 6.2 with respect
thereto; and (iii) such sublicense shall be pursuant to a written agreement with
such sublicensee containing reasonable provisions to protect SpeechWorks IPR
                                      11.
<PAGE>

consistent with the terms of this Agreement other mutually agreeable terms
mutually agreed by SpeechWorks and AT&T.

     4.3  RESERVATION OF RIGHTS. Notwithstanding any other provision in this
Agreement, no rights or licenses are granted under this Agreement, and no
provision of this Agreement shall be construed as conferring by implication,
estoppel or otherwise any license or right, to SpeechWorks or to any customer of
SpeechWorks, including without limitation any end users, system integrators or
value-added resellers of SpeechWorks Integrated Speech Products, under any claim
in any patent of AT&T IPR unless such claim is completely embodied in the
SpeechWorks Integrated Speech Product (in the case of an apparatus claim) or
such claim is completely performed by execution of the SpeechWorks Integrated
Speech Product (in the case of a method claim), as such product is furnished (or
as a combination of such products is furnished at one time) by SpeechWorks to
its customers, without the need for any additional product, service,
development, modification, Software or programming by SpeechWorks' customers or
a third party.

5.   DISTRIBUTION OF COMMERCIAL PRODUCTS

     5.1  BRANDING. SpeechWorks shall distribute products utilizing any AT&T
Speech Technology, or derivative works based thereon, with the AT&T Labs
Trademark and/or any other AT&T trademark designated in writing by AT&T
(collectively, "AT&T TRADEMARKS"), solely as provided in EXHIBIT D of this
Agreement, provided that for deployment [     ], if SpeechWorks [     ] that
[   ], SpeechWorks may provide the SpeechWorks Integrated Speech Product [    ].
Use of the AT&T Trademarks shall be in accordance with AT&T's then-current
trademark guidelines.  SpeechWorks shall be given reasonable advance written
notice of any change in AT&T's trademark guidelines and a reasonable
opportunity, [     ] ([     ]) [     ], to liquidate existing inventory which
does not comply with the changed guideline.  Upon AT&T's reasonable request,
SpeechWorks will provide AT&T with a reasonable number of copies of products
utilizing AT&T Speech Technology and any materials bearing any AT&T Trademark so
that AT&T can verify that SpeechWorks' use of the AT&T Trademarks is in
accordance with the requirements of this Agreement.  In the event that AT&T
notifies SpeechWorks that SpeechWorks' use of AT&T Trademarks does not comply in
a material respect as reasonably determined by AT&T with AT&T's then-current
trademark guidelines (which set forth both guidelines for the use of the marks
and for quality assurance) and/or other requirements under this Agreement,
SpeechWorks shall suspend distribution of the products containing such
deficiencies until such deficiencies are corrected.  The packaging,
documentation, and promotional materials for products utilizing the AT&T Speech
Technology, whether distributed to AT&T and its Affiliates or to third parties,
shall include credit, in form to be mutually agreed by the parties, that the
products contain certain speech Software components originating from AT&T Labs.
The form and content of all such statements referring to AT&T, AT&T Labs or AT&T
Speech Technology must be mutually agreed upon by both parties, but once AT&T
approves the form and substance of materials using the AT&T Trademarks,
SpeechWorks may reuse such materials without seeking AT&T's consent for each
use.

     5.2  APPOINTMENT OF AT&T AS RESELLER OF THE SPEECHWORKS INTEGRATED SPEECH
PRODUCT.  Any AT&T Business Unit shall have the right to be a reseller of the
SpeechWorks Integrated Speech Product for distribution to third parties on no
less favorable terms than any

                                      12.
<PAGE>

other reseller of SpeechWorks Speech Software. Any AT&T Business Unit may
exercise its right to become such a reseller at any time during the term of this
Agreement by written notice to SpeechWorks and by executing a mutually agreeable
SpeechWorks Reseller Agreement.

     5.3  DISTRIBUTION TO SYSTEM INTEGRATORS AND PLATFORM DEVELOPERS. To
incentivize third party integrators and developers to incorporate the
SpeechWorks Integrated Speech Product in their solutions and platforms,
SpeechWorks will offer to enter into agreements on commercially reasonable
terms, taking into consideration resource availability, with system integrators
and platform developers designated by AT&T for use and distribution of the
SpeechWorks Integrated Speech Product.

6.   FINANCIAL CONSIDERATION

     6.1  EQUITY CONSIDERATION PROVIDED BY SPEECHWORKS. In consideration for the
licenses granted by AT&T under this Agreement, AT&T shall receive the equity
consideration set forth in EXHIBIT E.

     6.2  LICENSE FEE PRICING TO BUSINESS UNITS.  Any AT&T Business Unit that,
during the term hereof, requires licenses of a SpeechWorks Integrated Speech
Product shall be entitled to obtain such license(s) from SpeechWorks for, and
shall pay SpeechWorks, a license fee as specified in EXHIBIT H.  If any such
AT&T Business Unit enters into a new license for SpeechWorks Integrated Speech
Product, or adds additional ports to any existing license for which it is not
yet contractually committed to pay the applicable fee, SpeechWorks shall notify
such AT&T Business Unit of the license fee to which such AT&T Business Unit is
entitled under this Section 6.2 and make such license fee available to such AT&T
Business Unit with respect to such new license or such additional ports.

     6.3  PAYMENT OF SUPPORT FEES BY AT&T. If any AT&T Business Unit that
licenses a SpeechWorks Integrated Speech Product as described in Section 6.2
wishes to obtain support for such SpeechWorks Integrated Speech Product, such
AT&T Business Unit shall pay SpeechWorks support fees as specified in EXHIBIT H.
If any such AT&T Business Unit enters into a new support agreement, or obtains
additional support under an existing support agreement for which it is not yet
contractually committed to pay the applicable support fee, SpeechWorks shall
notify such AT&T Business Unit of the support fee to which such AT&T Business
Unit is entitled under this Section 6.3 and make such support fee available to
such AT&T Business Unit with respect to such new support agreement or such
additional support.

     6.4  PAYMENT OF PROFESSIONAL SERVICES FEES BY AT&T. Any professional
services provided by SpeechWorks to any AT&T Business Unit shall be provided by
SpeechWorks at [       ].

7.   SUPPORT AND MAINTENANCE

     7.1  SUPPORT PROVIDED TO AT&T. For purposes of this Agreement, "SUPPORT
SERVICES" means the support services for the SpeechWorks Speech Software to be
provided by SpeechWorks to AT&T Business Units that license SpeechWorks Speech
Software, including technical support services, error correction services,
maintenance updates, training and other similar services.  AT&T and its
Affiliates may purchase Support Services on an annual or such

                                      13.
<PAGE>

other basis as may be mutually agreed. The details of the Support Services shall
be subject to one or more separate agreements between AT&T or the applicable
AT&T Affiliate and SpeechWorks.

     7.2  SUPPORT TO BE PROVIDED TO THIRD PARTY CUSTOMERS. SpeechWorks shall be
exclusively responsible for providing Support Services to purchasers of
SpeechWorks products incorporating AT&T Speech Technology.  AT&T shall have no
obligation to provide Support Services to such purchasers, even if the purchaser
requires technical assistance on an issue related to the AT&T Speech Technology.
The Support Services offered by SpeechWorks to such purchasers must include at
least technical support services, error correction services, maintenance
updates, and training.

     7.3  SUPPORT PROVIDED BY AT&T TO SPEECHWORKS.  AT&T shall provide support
to SpeechWorks, at no charge, for the initial transfer of the AT&T Speech
Software, up to a maximum of [     ] ([     ]) hours of technical support during
the first [     ] ([     ]) [     ] following the Effective Date.  Unless
otherwise mutually agreed by the parties, AT&T shall provide that support at
AT&T facilities, or remotely through means such as telephone, facsimile, or e-
mail, and the support shall be provided by personnel designated by AT&T.  After
AT&T has provided [     ] ([     ]) hours of support, or [     ] ([     ])
[     ] after the Effective Date, whichever occurs first, AT&T shall have no
further obligation to provide any support to SpeechWorks.

8.   PUBLICITY; MARKETING

     8.1  JOINT PRESS ANNOUNCEMENTS.  Consistent with the applicable regulatory
requirements, the parties shall issue a joint press release announcing their
relationship in the substantially in the form attached hereto as EXHIBIT K
within ten (10) days after the Effective Date.  The parties will agree on the
timing of the announcement for maximum impact, where "maximum impact" considers,
among other things, the availability of spokespeople from both companies.

     8.2  MARKETING OUTSIDE OF AT&T. SpeechWorks is solely responsible for
promoting and marketing the SpeechWorks Integrated Speech Product, but at
SpeechWorks' request, AT&T [     ] with SpeechWorks in its promotional and
marketing efforts [     ] in its [     ] such [     ]. SpeechWorks may, without
notifying AT&T or obtaining AT&T's consent, promote SpeechWorks Integrated
Speech Product as long as SpeechWorks does not mention or allude to AT&T, except
as the parties mutually agree in advance for the designation for use of the AT&T
Labs Trademark in SpeechWorks Integrated Speech Products as provided in EXHIBIT
D. The foregoing notwithstanding, SpeechWorks may, without obtaining AT&T's
consent, allude to its relationship with AT&T in slideware, PowerPoint
presentations and the like, data sheets and white papers relating to the
SpeechWorks Integrated Speech Product in accordance with specimen that been pre-
approved by AT&T in accordance with EXHIBIT D. SpeechWorks shall obtain AT&T's
written consent before mentioning or alluding to AT&T in the course of any
promotional activities other than those authorized above or in EXHIBIT D.

     8.3  [       ] WITHIN AT&T.  To help [      ] and [      ] the SpeechWorks
Integrated Speech Product within AT&T, AT&T Labs shall:

                                      14.
<PAGE>

                 (a) [     ] with AT&T [     ] for [     ] [       ] projects
listed in EXHIBIT G, and

                 (b) appoint an AT&T Labs employee to assist SpeechWorks on
executing the [       ] for such projects.

SpeechWorks acknowledges and agrees that each AT&T Business Unit has the [     ]
in determining its respective [     ], and this Agreement does not [     ] that
any AT&T Business Unit shall [     ] any SpeechWorks [     ].

9.   OTHER SPEECHWORKS PRODUCTS AND SERVICES

     AT&T shall also have the option to purchase from time to time all other
existing and future SpeechWorks products and services related to the provision
of voice-enabled services, at [     ] then [     ] for [     ] and [     ].
The terms and conditions for such purchases if any shall be mutually agreed upon
by the parties and embodied in a separate purchase agreement.

10.  ASSIGNMENT AND CHANGE OF CONTROL

     10.1  ASSIGNMENT. Except as expressly permitted herein, neither party may
assign, transfer or pledge this Agreement, or any interest, license, or rights
of any kind herein, in any manner, without the prior written consent of the
other party to this Agreement, except (i) in the case of SpeechWorks, in
connection with a merger, reorganization or sale of substantially all of the
business of SpeechWorks or, (ii) in the case of AT&T, in connection with a
merger, reorganization or sale of substantially all of the business relating to
AT&T Speech Technology to an entity which is not a Specified SpeechWorks
Competitor.  Any purported assignment, transfer or pledge of this Agreement in
violation of this Section 10 shall be null and void. Any permitted assignment,
transfer or pledge of this Agreement shall be subject to Section 10.2.

     10.2  MERGERS, ACQUISITION OF ASSETS, OR CHANGE OF CONTROL.  If either
party enters any agreement or consummates any permitted transaction or series of
transactions under which an entity (the "ACQUIRING ENTITY") would acquire,
whether by merger or otherwise, (a) substantially all of the business of such
party (or in the case of AT&T, substantially all of the business relating to
AT&T Speech Technology) or (b) beneficial ownership or control, directly or
indirectly, of more than fifty percent (50%) of the outstanding shares or
securities representing the right to vote for the election of directors of the
assigning party (each a "TRIGGER EVENT"), this Section 10.2 shall apply.  If the
Triggering Event will result in the Acquiring Entity acquiring substantially all
of the business of the assigning party (or in the case of AT&T, substantially
all of the business relating to AT&T Speech Technology), then prior to
consummating such transaction or series of transactions, the Acquiring Entity
shall agree in writing to be bound by the terms and conditions of this
Agreement.  If the Acquiring Entity fails at or before consummation of such a
Trigger Event to agree in writing to be bound by the terms and conditions of
this Agreement, the other party shall be entitled, at its option, to terminate
this Agreement upon thirty (30) days written notice.  If SpeechWorks is the
assigning party and the Acquiring Entity is a Specified AT&T Competitor, then
upon consummation of the Trigger

                                      15.
<PAGE>

Event, the following shall apply even if AT&T has exercised the termination
right stated in this Section 10.2:

                 (i) The source code of the SpeechWorks Integrated Speech
Product shall be released to AT&T and AT&T shall be entitled to exercise the
license to such source code according to the terms of the source code escrow and
license agreement in EXHIBIT J.

                 (ii) The Acquiring Entity shall provide at least [     ] man
hours of engineering support over the [     ] ([     ]) [     ] period
following release of the source code, free of charge, to AT&T to assist AT&T to
support and continue development of the SpeechWorks Integrated Speech Product.

                 (iii)  SpeechWorks or the Acquiring Entity shall pay to AT&T
(in addition to any share consideration that may be otherwise due in connection
with SpeechWorks equity then owned by AT&T) a supplemental license fee for the
licenses granted under this Agreement in cash in an amount equal to (a) if the
Trigger Event occurs on or before two years after the Effective Date, the lesser
of five percent (5%) of the Fair Market Value of SpeechWorks equity at the time
of consummation of the Trigger Event and Twenty-five Million Dollars
($25,000,000), or (b) if the Trigger Event occurs more than two years after the
Effective Date, the lesser of three percent (3%) of the Fair Market Value of
SpeechWorks equity at the time of consummation of the Trigger Event and Fifteen
Million Dollars ($15,000,000).  "FAIR MARKET VALUE" for purposes of this
Agreement shall mean (a) if the shares of SpeechWorks are publicly traded
securities at the date of consummation of the Trigger Event, the closing market
price on such date or the most recent closing market price if there was no
closing market price on such date times the total number of outstanding shares
of SpeechWorks, or (b) if the shares of SpeechWorks are not publicly traded
securities at the time of determination of such Fair Market Value, the fair
market value of SpeechWorks as determined in such Trigger Event transaction or
if the Fair Market Value is not determined in such Trigger Event transaction,
then the fair market value of SpeechWorks as determined by an independent
investment banker or qualified appraiser selected in good faith by the Board of
Directors of SpeechWorks and approved by AT&T, such approval not to be
unreasonably withheld, which determination shall be binding on SpeechWorks, the
Acquiring Entity (in the case of determination in the case of a Trigger Event
under this Section 10.2) and AT&T.

                 (iv) In addition to and without limiting the other provisions
of this Section 10.2, if as a result of the Trigger Event AT&T does not receive
cash or readily tradable securities in exchange for all shares of SpeechWorks
held by AT&T, AT&T shall have the right to require SpeechWorks (or the Acquiring
Entity if SpeechWorks is not the surviving entity) to purchase all shares of
SpeechWorks held by AT&T (or other consideration received by AT&T in exchange
for its shares of SpeechWorks) for cash or readily tradable securities equal to
the Fair Market Value of the SpeechWorks equity owned by AT&T at the time of the
Trigger Event.

     10.3  MOST FAVORED TREATMENT. If at any time AT&T controls, is controlled
by or is under common control with (as control is defined in the definition of
Affiliate) a specific SpeechWorks competitor, then the rights of AT&T and its
Affiliates to receive most favorable, most favored, no less favorable, and the
like sorts of treatment pursuant to this Agreement shall terminate.

                                      16.
<PAGE>

11.  REPRESENTATIONS AND WARRANTIES

     11.1  BY AT&T. AT&T makes the following representations and warranties to
SpeechWorks, each of which is true and correct on the date hereof and shall
continue to be true and correct at all times during the term of this Agreement,
and hereby covenants as follows:

          (a) ORGANIZATION, STANDING AND POWER.  AT&T is a corporation duly
organized and validly existing under the laws of the state of New York and has
all requisite corporate power and authority to execute, deliver and perform this
Agreement and any other agreements contemplated hereby and to consummate the
transactions contemplated hereby.

          (b) NO CONFLICTING AGREEMENTS.  AT&T is not currently obligated nor
will it assume any future obligation under any contract (including without
limitation any license, covenant or commitment of any nature) or other
agreement, instrument or arrangement that could conflict with its obligations
under this Agreement.

     11.2  BY SPEECHWORKS. SpeechWorks makes the following representations and
warranties to AT&T, each of which is true and correct on the date hereof and
shall continue to be true and correct at all times during the term of this
Agreement, and hereby covenants as follows:

          (a) ORGANIZATION, STANDING AND POWER.  SpeechWorks is a corporation
duly organized and validly existing under the laws of the state of Delaware and
has all requisite corporate power and authority to execute, deliver and perform
this Agreement and any other agreements contemplated hereby and to consummate
the transactions contemplated hereby.

          (b) NO CONFLICTING AGREEMENTS.  SpeechWorks is not currently obligated
nor will it assume any future obligation under any contract (including without
limitation any license, covenant or commitment of any nature) or other
agreement, instrument or arrangement that could conflict with its obligations
under this Agreement.

12.  RISK ALLOCATION

     12.1  LIMITATION OF WARRANTIES. EXCEPT AS EXPRESSLY PROVIDED OTHERWISE IN
THIS AGREEMENT, NEITHER PARTY MAKES ANY WARRANTIES WHATSOEVER WITH RESPECT TO
THE AT&T SPEECH TECHNOLOGY, THE SPEECHWORKS SPEECH SOFTWARE OR THE SPEECHWORKS
INTEGRATED SPEECH PRODUCT, AS APPLICABLE, UNDER THIS AGREEMENT, INCLUDING
WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, OR NON-INFRINGEMENT OF THIRD PARTY INTELLECTUAL PROPERTY
RIGHTS.  ALL SUCH WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.

     12.2  LIMITATION ON LIABILITY. IN NO EVENT SHALL EITHER PARTY BE LIABLE TO
THE OTHER OR TO ANY THIRD PARTY FOR ANY CONSEQUENTIAL, EXEMPLARY, PUNITIVE,
INCIDENTAL, INDIRECT, OR SPECIAL DAMAGES OR COSTS (INCLUDING REASONABLE
ATTORNEYS' FEES) OR FOR ANY LOSS OF PROFITS OR GOODWILL HOWEVER ARISING OUT OF
OR RELATED TO THIS

                                      17.
<PAGE>

AGREEMENT, WHETHER OR NOT EITHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES OR COSTS. EITHER PARTY'S CUMULATIVE LIABILITY TO THE OTHER PARTY
FOR DAMAGES HEREUNDER, EXCEPT FOR DAMAGES ARISING FROM INFRINGEMENT CLAIMS AS
PROVIDED IN SECTION 12.3, SHALL IN NO EVENT EXCEED FIVE MILLION DOLLARS
(U.S. $5,000,000).

     12.3  INDEMNIFICATION.

           12.3.1  SPEECHWORKS' DUTY TO INDEMNIFY AT&T.  Subject to the
conditions set forth in this Section 12.3, SpeechWorks at its own expense shall
indemnify, defend and hold AT&T and its Affiliates harmless from any and all
claims, damages, losses, costs, actions and expenses, including reasonable
attorneys' and experts' fees, arising from (i) any breach of SpeechWorks'
representations or warranties set forth in Section 11.2 hereof, (ii) the use or
distribution of any SpeechWorks Speech Software by SpeechWorks or its
distributors or customers (other than AT&T or its Affiliates), and (iii) any
claim or contention that any SpeechWorks Speech Software infringes any third
party's IPR or trademark rights, provided that SpeechWorks shall have no duty to
indemnify, defend or hold harmless AT&T and its Affiliates under this Section
12.3.1 with respect to any claim or contention for which AT&T is obligated to
indemnify SpeechWorks under Section 12.3.2.

           12.3.2 AT&T'S DUTY TO INDEMNIFY SPEECHWORKS. Subject to the
conditions set forth in this Section 12.3, AT&T at its own expense shall
indemnify, defend and hold SpeechWorks harmless from any and all claims,
damages, losses, costs, actions and expenses, including reasonable attorneys'
and experts' fees, arising from (i) any breach of AT&T's representations and
warranties set forth in Section 11.1 hereof, and (ii) any claim or contention
that the AT&T Speech Software or the AT&T TTS Software as furnished infringes
any third party's IPR or that the use of the AT&T trademarks in accordance with
Section 4.1.2 infringes any third party's trademark; provided that AT&T shall
have no obligation to indemnify, defend, or hold SpeechWorks harmless from any
claims, damages, losses, costs, actions or expenses arising from any claim or
contention arising out of or based upon (a) the combination, operation, or use
of the AT&T Speech Software with programs or data not supplied by AT&T or (b)
any modification of any AT&T Speech Software made by any person or entity other
than AT&T.

           12.3.3  CONDITIONS TO DUTY TO INDEMNIFY.  Prior to incurring any
indemnifiable expenses, the indemnitee shall promptly notify the indemnifying
party in writing of any claim, suit, expense or the like for which the
indemnifying party will indemnify the indemnitee under this Section 12.3.  The
indemnifying party shall be entitled, at its election, to control the defense
and settlement of any claim, action, proceeding or suit, and the indemnitee
shall cooperate with the indemnifying party, at the indemnitee's expense, in
providing such assistance in defending such claim, action, proceeding or suit as
the indemnifying party may reasonably request.  If the indemnifying party elects
not to assume control of the matter, it shall indemnify the indemnitee as
provided in this Section 12.3; provided that the indemnitee shall obtain the
indemnifying party's prior written approval of any settlement, which approval
the indemnifying party agrees not to unreasonably withhold.

           12.3.4  SPEECHWORKS' OPTIONS.  If the SpeechWorks Speech Software
should become the subject of any claim or contention of infringement of the IPR
of any third party, or in SpeechWorks' opinion be likely to become subject to
such a claim or contention, SpeechWorks may, but shall not be obligated to, at
its option and expense, and without limiting its obligations under Section
12.3.1 (a) procure the right for AT&T to use such SpeechWorks Speech Software

                                      18.
<PAGE>

in accordance with the licenses granted under this Agreement, (b) replace or
modify the SpeechWorks Speech Software so as to make it non-infringing, or (c)
if options (a) and (b) are not available on commercially reasonable terms,
terminate the licenses granted under this Agreement with respect to the portion
of such SpeechWorks Speech Software subject to such claim or contention.  If
SpeechWorks terminates licenses under option (c) of this Section 12.3.4,
SpeechWorks shall compensate AT&T for reasonable engineering costs incurred in
removing the affected SpeechWorks Speech Software.  Any amounts paid by
SpeechWorks under this Section 12.3.4 shall be included within, and subject to,
the limitation on liability specified in Section 12.3.6.

           12.3.5  AT&T'S OPTIONS.  If the AT&T Speech Technology should become
the subject of any claim or contention of infringement of the IPR of any third
party, or in AT&T's option be likely to become subject to such a claim or
contentions, AT&T may, but shall not be obligated to, at its option and expense,
and without limiting its obligations under Section 12.3.2 (a) procure the right
for SpeechWorks to use such AT&T Speech Software in accordance with the licenses
granted under this Agreement, (b) replace or modify the AT&T Speech Software so
as to make it non-infringing, or (c) if options (a) and (b) are not available on
commercially reasonably terms, terminate the licenses granted under this
Agreement with respect to the portion of such AT&T Speech Software subject to
such claim or contention. If AT&T terminates licenses under option (c) of this
Section 12.3.5, AT&T shall compensate SpeechWorks for reasonable engineering
costs incurred in removing the affected AT&T Speech Software. Any amounts paid
by AT&T under this Section 12.3.5 shall be included within, and subject to, the
limitation on liability specified in Section 12.3.6.

           12.3.6  Sole Remedy; LIMITATION OF LIABILITY.  The indemnifying
party's performance under this Section 12.3 shall be indemnitee's sole and
exclusive remedy in the event of infringement or misappropriation of the
copyright, patent, trademarks, trade secrets or any other IPR of any third
parties. Each party's cumulative liability to the other party under this Section
12.3 with respect to claims or contentions of infringement or misappropriation
of the copyright, patents, trademarks, trade secrets or any other IPR of third
parties shall in no event exceed in the aggregate (a) Five Million Dollars
(U.S.$5,000,000) cash, plus (b) an amount, not to exceed Fifteen Million Dollars
(U.S.$15,000,000), equal to the sum of the Fair Market Value of all shares of
SpeechWorks received by AT&T under this Agreement and held by AT&T determined as
of the date AT&T is obligated to make payment under this Section 12.3 and the
net proceeds from any prior sale by AT&T of shares of SpeechWorks received by
AT&T under this Agreement. AT&T may, at its election and in its sole discretion,
satisfy any portion of its liability under item (b) of this Section 12.3.6 by
surrendering to SpeechWorks shares of SpeechWorks held by AT&T and upon such
surrender AT&T shall be deemed to have discharged its liability under this
Section 12.3.6(b) in an amount equal to the Fair Market Value of such
surrendered shares. If AT&T, at its election and in its discretion , elects to
surrender all shares of SpeechWorks received by AT&T under this Agreement then
held by AT&T, plus the net proceeds from any prior sale of SpeechWorks shares
received by AT&T under this Agreement, AT&T shall be deemed to have fully
satisfied its liability under item (b) of this Section 12.3.6 and in that event
AT&T's total remaining liability to SpeechWorks under this Section 12.3 shall be
limited to the Five Million Dollars (U.S.$5,000,000) cash referenced in item
(a) of Section 12.3.6.

                                      19.
<PAGE>

13.  CONFIDENTIALITY

     13.1  CONFIDENTIAL INFORMATION. The parties acknowledge that they have
received or may receive confidential information relating to the other party's
products, product, business and financial plans, customer lists and information
and trade secrets in connection with the performance of this Agreement, together
with such other information designated as confidential or proprietary by one
party, ("CONFIDENTIAL INFORMATION").  Confidential Information shall be limited
to information which (i) if furnished in writing or other tangible form, is
clearly and conspicuously marked at the time of disclosure with a legend
identifying it as "CONFIDENTIAL" or "PROPRIETARY", or (ii) if presented orally
or in other intangible form, is identified as confidential or proprietary at or
before the time of disclosure or should be reasonably understood by the
recipient to be confidential information of the disclosing party or (iii) is
source code.  For purposes of this section, the text of email messages shall be
treated as oral communications, but any attachment information shall be treated
as if furnished in writing.  Confidential Information shall not include any
information which: (i) is or falls into the public domain without fault of the
receiving party; or (ii) the receiving party can show was in its possession
prior to receipt thereof from the disclosing party; or (iii) the receiving party
receives from a third party with no obligation of confidence to the disclosing
party; or (iv) the disclosing party discloses to a third party with no
obligation of confidence to the disclosing party; or (v) the receiving party can
demonstrate was independently developed without benefit of any Confidential
Information of the disclosing party.

     13.2  USE OF CONFIDENTIAL INFORMATION. Except as (i) contemplated,
permitted, or required in carrying out this Agreement or in exercising the
licenses granted under Section 4, or (ii) required by law or by any competent
government authority, or (iii) such limited disclosures in confidence as may be
reasonably necessary to either party's attorney's and accountants, the receiving
party of any Confidential Information ("RECIPIENT") disclosed by a disclosing
party ("DISCLOSER") shall not use such Confidential Information or disclose such
Confidential Information to any third party, either during the term of this
Agreement or thereafter, without the prior written consent of Discloser.  Prior
to making a disclosure pursuant to (ii) above, the Recipient shall give
Discloser as much advance notice as is practicable and cooperate with Discloser
in its attempts to obtain a protective order.  Thus, Recipient shall use the
Confidential Information only to perform its obligations and exercise its rights
under this Agreement and to the extent permitted in the licenses granted
hereunder.   In the event that either party is required by law to disclose the
existence or the substance of this Agreement  for purposes of an SEC disclosure
or other legal process, the  party wishing to make such disclose shall give the
other party prior notice to pursuant to Section 17.4 and shall permit such other
party a reasonable opportunity to seek to protect from disclosure all or certain
portions of this Agreement by redaction or otherwise.

     13.3  OWNERSHIP OF CONFIDENTIAL INFORMATION. All Confidential Information
shall remain the property of Discloser and shall be returned upon written
request, except if the exception in subsection (i) of Section 13.2 applies.
Recipient's duty to protect Confidential Information commences upon receipt of
the Confidential Information.

     13.4  DISCLOSURE OF CONFIDENTIAL INFORMATION TO EMPLOYEES AND CONTRACTORS.
Except as otherwise provided in or permitted by this Agreement, neither party
shall use,

                                      20.
<PAGE>

reproduce, duplicate, copy, or otherwise disclose, distribute, or disseminate
any part of the other party's Confidential Information except for internal use
by employees or contractors of such party or its Affiliates on a need-to-know
basis. Prior to disclosing Confidential Information to a contractor, Recipient
shall have executed with such contractor an agreement which restricts use or
disclosure of Discloser's Confidential Information (or categories of
Confidential Information which encompass Confidential Information) in a manner
consistent with this Agreement.

     13.5  NO LICENSES OR WARRANTIES FOR CONFIDENTIAL INFORMATION. Except as
otherwise provided in this Agreement; no license under any IPR is granted or
implied by the conveying of Confidential Information to Recipient.  None of the
Confidential Information which may be disclosed by Discloser shall constitute
any representation, warranty, assurance, guarantee, or inducement by Discloser
of any kind, and, in particular, with respect to the non-infringement of any
intellectual property rights, or other rights of third persons or of Disclosure.

     13.6  RESIDUALS. Anything in this Agreement to the contrary
notwithstanding, either party shall be free to use for any purpose the
"residuals" resulting from access to or work with the Confidential Information
of the other party.  The term "residuals" means information which is not
protected by patent or copyright, in non-tangible form, that may be retained by
persons who have has access to the Confidential Information, without the aid of
reference to such Confidential Information in tangible form, including ideas,
concepts, know-how, or techniques contained therein.  Neither party shall have
any obligation to limit or restrict the assignment of such persons or to pay
royalties for any work resulting from the use of residuals, provided that the
foregoing shall not be deemed to grant to either party a license under the other
party's copyrights or patents except as specified herein.  Notwithstanding the
above, the parties shall not sell, license, or distribute the residuals as
stand-alone products or services.

     13.7  DISCLOSURE OF AGREEMENT. Except for the information disclosed as
provided in Section 8, neither party shall disclose the existence or any of the
terms of this Agreement at any time, without the prior written approval of the
other party, except (i) as may be required by law or by any competent government
authority (provided such disclose shall be subject to the last sentence of
13.2), or (ii) such limited disclosures in confidence as may be reasonably
necessary to either party's bankers, investors or potential investors,
acquirors, attorneys and accountants.

14.  DISPUTE RESOLUTION

     14.1  AMICABLE RESOLUTION. The parties shall first attempt to amicably
resolve any dispute that may arise under this Agreement.  If the parties cannot
resolve the dispute within 30 days, either party may refer the dispute to
arbitration pursuant to Section 14.2.

     14.2  ARBITRATION. Subject to first attempting to amicably resolve disputes
pursuant to Section 14.1 hereof, either party may, upon written notice to the
other and the CPR Institute for Dispute Resolution ("CPR"), submit any dispute
or controversy relating to or arising out of the subject matter of this
Agreement to binding arbitration.  The arbitration shall be conducted in
accordance with the then current CPR "Non-Administered Arbitration Rules" or any
successor CPR rules, and the procedures specified in this Section.  The
arbitration shall be conducted by one (1) arbitrator who is selected from a CPR
panel having members knowledgeable in the legal and technical aspects of the
subject matter of this Agreement.  If the parties cannot mutually

                                      21.
<PAGE>

agree upon an arbitrator within ten (10) days after submission of the dispute to
the CPR, the CPR shall appoint the arbitrator. The arbitrator shall determine
issues of arbitrability, but may not limit, expand or otherwise modify the terms
of this Agreement nor have authority to award punitive or other damages in
excess of compensatory damages and each party irrevocably waives any claim
thereto. Each party shall bear its own expenses, but those related to the
compensation of the arbitrator and the costs of arbitration shall be borne
equally. Discovery shall be strictly limited to the production of documents
directly relevant to the stated claims and each party shall be limited to three
(3) depositions of no longer than three (3) hours each. Any award shall be made
within six (6) months of selection of the arbitrator and may be entered in any
court having competent jurisdiction. The arbitrator shall orally disclose to the
parties the reasoning behind the award but shall not prepare any written
statement other than the remedies granted. The parties, their representatives,
other participants and the arbitrators shall hold the existence, content and
result of the arbitration in confidence. The parties agree that the decision of
the arbitrator shall be deemed a compromise of a dispute under Rule 408 of the
U.S. Federal Rules of Evidence, shall not be discoverable in any proceeding,
shall not be admissible in any court (except for the enforcement thereof) or
arbitration and shall not bind or collaterally estop either party with respect
to any claim or defense made by any third party. The arbitration shall be
conducted in New York, New York.

     14.3  IPR CLAIMS. Notwithstanding anything to the contrary in Section 14.2,
the parties shall not be required to attempt to amicably resolve or arbitrate
claims concerning the validity, enforceability, scope or infringement of any IPR
or any trademark rights, and shall retain the right to pursue all such claims in
any court of competent jurisdiction.  In the event of any such infringement or
misappropriation, the parties recognize that money damages may not be an
adequate remedy and therefore agree that, in addition to any other remedies
available hereunder, by law or otherwise, a party whose IPR or trademark rights
have been infringed or misappropriated by the other party shall be entitled to
seek injunctive relief against any such continued infringement or
misappropriation.

15.  EXPORT MATTERS

     15.1  EXPORT LAWS. The parties acknowledge that Software, services
(including Support Services), and technical information, if any, provided under
this Agreement may be subject to U.S. export laws and regulations and any use or
transfer of such Software, services, and technical information must be
authorized under those regulations (U.S. Export Administration Regulations, 15
CFR et seq.).  Each party will not use, distribute, transfer or transmit the
Software, services, or technical information (even if incorporated into other
products) obtained from the other party pursuant to this Agreement except in
compliance with U.S. export regulations.

     15.2  PROHIBITED COUNTRIES. Regardless of whether the export or reexport of
Software, services (including Support Services), and technical information
provided hereunder is restricted under applicable laws and regulations, the
parties assure one another that they each will not, without the other's prior
written consent, directly or indirectly, export or reexport any such Software,
services, and technical information obtained hereunder to any country which is
in the then current list of prohibited countries specified in the U.S. export
laws and regulations.  For the purposes of this Section 15, "export" and
"reexport" mean transferring or releasing to another country or to a national of
another

                                      22.
<PAGE>

country (wherever that person is located) by any means, including physical,
electronic, or otherwise.

16.  TERM AND TERMINATION

     16.1  TERM. The initial term of this Agreement shall commence on the
Effective Date and shall continue for five (5) years thereafter (the "INITIAL
TERM").  After the Initial Term, this Agreement shall automatically renew for
successive six (6) month periods (each a "RENEWAL PERIOD") unless (i) either
party notifies the other party of its decision not to renew the term of this
Agreement at least two (2) months prior to the end of the then current term or
(ii) this Agreement is terminated pursuant to Section 16.2.

     16.2  TERMINATION. This Agreement may be terminated prior to the expiration
of the applicable term as follows:

                 (i) by either SpeechWorks or AT&T upon thirty (30) days prior
notice for any material default or breach of any of the material terms and
conditions of this Agreement by the other party, unless the defaulting party has
cured such failure or default within such 30-day period;

                 (ii) by either party immediately upon notice, if (a) the other
party is adjudicated as bankrupt or makes an assignment for the benefit of
creditors, or if a receiver, liquidation, administrator or trustee is appointed
for such party's affairs or any analogous procedure is initiated or (b) the
other party is dissolved; or

                 (iii) provided that AT&T has fulfilled its obligations under
Section 8.3 hereof, at any time following the date that is six (6) months
following the Effective Date, by AT&T upon sixty (60) days prior notice to
SpeechWorks.

     16.3  EFFECT OF TERMINATION. The license granted in Section 4.1.1 shall
survive termination of this Agreement. Upon termination of this Agreement for
any reason, the provisions of this Section 16 (Term and Termination) and of
Section 3 (Ownership of Intellectual Property), Section 11 (Representations and
Warranties), Section 12 (Risk Allocation), Section 13 (Confidentiality), Section
14 (Dispute Resolution), Section 15 (Export Matters), and Section 17 (General
Provisions) shall survive and remain effective. Termination of this Agreement
shall not prejudice any claim of either party accrued on account of any default
or breach by the other. Upon termination of this Agreement for any reason, the
provisions of Section 4.2 (License for SpeechWorks Integrated Speech Product)
shall survive and remain effective; except that commercial deployment licenses
granted under Section 4.2.2 after termination shall be subject to payment of the
following license fees: (a) in the case of termination for any reason other than
termination by SpeechWorks by reason of AT&T's breach, subject to the provisions
of Section 10.3, [     ] pricing terms; (b) in the case of termination by
SpeechWorks by reason of AT&T's breach, SpeechWorks' then standard pricing
subject to such discount as may be mutually agreed by the SpeechWorks and the
applicable AT&T Business Unit.

                                      23.
<PAGE>

17.  GENERAL PROVISIONS

     17.1 (a)  FURTHER ASSURANCES. Each of the parties covenants to execute
upon request any further documents reasonably necessary to effect the express
terms and conditions of this Agreement, including such documents as are
reasonably necessary to vest title in IPR as provided in this Agreement.  Each
party shall, without any cost to the other, take such action as is necessary to
secure from its project personnel the rights required to effect the ownership of
IPR as provided in this Agreement.

          (b) NON-SOLICITATION. During the Term of this Agreement and for six
(6) months thereafter, neither party nor any of its controlled Affiliates shall,
directly or indirectly, whether by itself, its employees or agents and whether
on its own behalf or on behalf of any other person, firm or company or otherwise
howsoever, solicit for the purpose of hiring any employee, of the other party,
whether or not that person would commit any breach of any contract of employment
by reason of his/her leaving the service of such other party, without such other
party's written consent. For purposes of this Section 17(b), general
solicitations through advertisements, trade shows, job fairs and the like shall
deemed not to constitute solicitations.

     17.2  THIRD PARTY BENEFICIARIES. Nothing in this Agreement, express or
implied, is intended to or shall confer on any third party any rights (including
third-party beneficiary rights), remedies, obligations or liabilities under or
by reason of this Agreement.  This Agreement shall not provide any third parties
with any remedy, claim, liability, reimbursement, cause of action or other right
in excess of those existing without reference to the terms of this Agreement.
No third party shall have any right, independent of any right that exists
irrespective of this Agreement, to bring any suit at law or equity for any
matter governed by or subject to the provisions of this Agreement.

     17.3  COMPUTATION OF TIME. If a time period provided in this Agreement
requires a certain action be performed within ten (10) or less days, then
intervening Saturdays, Sundays and legal holidays shall not be included in the
computation of time.  If a time period requires a certain action be performed
within eleven (11) or more days, then intervening Saturdays, Sundays and legal
holidays shall be included in the computation of time.  In the event that a time
period expires on a Saturday, Sunday or legal holiday, the time period shall be
deemed to expire on the next day that is not a Saturday, Sunday or legal
holiday.  For purposes of this Agreement, "legal holidays" shall mean New Year's
Day, Birthday of Martin Luther King, Jr., President's Day, Memorial Day,
Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day and
the Friday thereafter, and Christmas Day, whether or not observed by a party
hereto.

     17.4  NOTICES. Unless otherwise provided in this Agreement, all notices
permitted or required under this Agreement shall be in writing, shall reference
this Agreement, and shall be sent by any of the following methods: (a) certified
mail, postage-prepaid, return-receipt requested, or (b) a delivery service which
requires proof of delivery signed by the recipient.  A party may change its
address for notice by written notice delivered in accordance with this Section.

                                      24.
<PAGE>

     If to SpeechWorks:  SpeechWorks International, Inc.
                         695 Atlantic Avenue
                         Boston, Massachusetts 02111
                         Attn: President

                         With copy to General Counsel (at the same address)
                         and to:

                         Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
                         One Financial Center
                         Boston, Massachusetts 02111
                         Attn: Steven P. Rosenthal, Esquire

     If to AT&T:         AT&T Labs
                         180 Park Ave.
                         Florham Park, New Jersey 07932
                         Attn: President of AT&T Labs

     With copy to:       AT&T Corp.
                         295 N. Maple Ave.
                         Basking Ridge, New Jersey 07920
                         Attn: Vice President of Law

     17.5  FORCE MAJEURE. Except as otherwise set forth in this Agreement, a
party will not be deemed to have materially breached this Agreement to the
extent that performance of its obligations or attempts to cure any breach are
delayed or prevented by reason of any act of God, fire, natural disaster,
accident, act of government, shortage of materials or supplies beyond the
reasonable control of such party, strike, labor dispute or walkout, or any other
cause beyond the reasonable control of each party (a "FORCE MAJEURE EVENT");
provided that the party whose performance is delayed or prevented promptly
notifies the other party of the nature and duration of the force majeure event
and uses commercially reasonable efforts to overcome the difficulties created
thereby and resumes performance of its obligations as soon as practicable.

     17.6  NO OTHER OBLIGATIONS. This Agreement is non-exclusive and, except as
this Agreement provides, will not be interpreted (i) to limit either party's
right to obtain products or services from other sources; (ii) to prohibit or
restrict either party from independently developing or acquiring new products or
services, improving existing products or services, or marketing any new,
improved, or existing products or services; (iii) to restrict either party from
making, having made, using leasing, licensing, selling, or otherwise disposing
of any existing or future products or services of any type; (iv) to limit either
party's right to deal with any other vendors, suppliers, contractors, or
customers; or (v) to commit either party to favor or recommend any product or
service of the other party; to be binding, any such restriction or commitment
must be in writing and signed by both parties.  The preceding sentence will not
be interpreted as an implied license under any patent, copyright, trademark, or
other intellectual property right of either party.  Without limitation on the
generality of the foregoing, AT&T shall not be obligated to use the SpeechWorks
Speech Software to commercially provide AT&T Branded Services.

                                      25.
<PAGE>

     17.7  INDEPENDENT CONTRACTORS. In performing this Agreement, each of the
parties will operate as, and have the status of, an independent contractor.
This Agreement does not create any agency, employment, partnership, joint
venture, franchise or other similar or special relationship between the parties.
Neither party will have the right or authority to assume or create any
obligations or to make any representations, warranties or commitments on behalf
of any other party, whether express or implied, or to bind the other party in
any respect whatsoever.

     17.8  MARKS. Except as otherwise provided in this Agreement, neither party
shall (i) display or use, in advertising or otherwise, any of the other party's
trade names, logos, trademarks, trade devices, trade dress, service marks,
symbols, abbreviations or registered marks, or contractions or simulations
thereof, or any other indicia of origin (hereinafter referred to collectively as
"MARKS") or (ii) authorize or permit the other party's Marks to be used or
displayed by any Person.  Neither party shall claim ownership or any other
rights in the other party's Marks.

     17.9  SEVERABILITY. If any provision of this Agreement or portion thereof
is determined by a court of competent jurisdiction, or declared under any law,
rule or regulation of any government having jurisdiction over the parties
hereto, to be invalid, illegal or otherwise unenforceable, then such provision
will, to the extent permitted by the court or government not be voided but will
instead be construed to give effect to its intent to the maximum extent
permissible under applicable law and the remainder of this Agreement will remain
in full force and effect according to its terms.

     17.10  COMPLIANCE WITH LAW. Each party agrees that all of its obligations
contained in this Agreement and any action taken by it pursuant to this
Agreement shall be performed in accordance with all applicable laws, statutes,
rules, regulations and ordinances.

     17.11  CHOICE OF LAW. This Agreement shall be governed by and construed
under, and the legal relations between the parties hereto shall be determined in
accordance with, the laws of the State of New York, without giving effect to
such state's conflict of law principles.

     17.12  RULES OF CONSTRUCTION. As used in this Agreement, (i) neutral
pronouns and any derivations thereof shall be deemed to include the feminine and
masculine and all terms used in the singular shall be deemed to include the
plural and vice versa, as the context may require; (ii) the words "HEREOF" and
"HEREUNDER" and other words of similar import refer to this Agreement as a
whole, including all exhibits and schedules as the same may be from time to time
amended or supplemented and not to any subdivision of this Agreement; (iii) the
words "PARTY" and "PARTIES" refer, respectively, to a party or to both of the
parties to this Agreement; (iv) the word "including" is not intended to be
exclusive and means "including without limitation"; and (v) descriptive headings
are inserted for convenience of reference only and do not constitute a part of
and shall not be utilized in interpreting this Agreement.  This Agreement shall
be fairly interpreted in accordance with its terms and without any strict
construction in favor of or against either party.

     17.13  ENTIRE AGREEMENT; MODIFICATION; WAIVER. This Agreement, including
the Exhibits, constitutes the entire agreement of the parties concerning its
subject matter and supersedes any and all prior or contemporaneous, written or
oral negotiations, correspondence,

                                      26.
<PAGE>

understandings and agreements between the parties respecting the subject matter
of this Agreement. No supplement, modification or amendment to this Agreement
shall be binding unless evidenced by a writing that references this Agreement
and is signed by the party against whom it is sought to be enforced. No waiver
of any of the provisions of this Agreement shall be deemed, or shall constitute,
a waiver of any other provision, whether or not similar, nor shall any waiver
constitute a continuing waiver. No waiver shall be binding unless executed in
writing by the party making the waiver.

     17.14  COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed to be an original instrument enforceable in accordance
with its terms.

     17.15  MOST FAVORABLE. When the expressions, "most favorable," "most
favored," " no less favorable" and the like are used in this Agreement to
compare an arrangement offered under this Agreement to an arrangement offered to
a third party, all salient economic terms of the two arrangements shall be
considered in making such comparison.

               [Remainder of this page intentionally left blank]

                                      27.
<PAGE>

                                   EXHIBIT A

                              AT&T SPEECH SOFTWARE

Watson Network 1.0, including modules thereof that enable automatic speech
recognition (ASR) (including large vocabulary recognition), natural language
understanding (NLU), dialog management (DM), speaker verification (SV), and
speaker identification (SI).

                              Exhibit A - Pg. 1.
<PAGE>

                                   EXHIBIT B

                          SPEECHWORKS SPEECH SOFTWARE

 .  SpeechWorks 6, including SpeechWorks SMARTRecognizer(TM) core recognition
   engine; SpeechWorks DialogModule(TM) building blocks; and SpeechWorks
   Development and Tuning Tools for rapid application development.

 .  SpeechSiteTM packaged application solution, including a built-in 5000 name
   (base) auto-attendant.

                              Exhibit B - Pg. 1.
<PAGE>

                                   EXHIBIT C

                               STATEMENT OF WORK

The description of the work to be performed by AT&T and SpeechWorks for a
SpeechWorks Integrated Speech Product is divided into two parts.  The first part
describes the process that we have agreed to for defining, evaluating, and
developing functionality for the SpeechWorks Integrated Speech Product.  The
second part describes the initial functionality that we agree to pursue in the
initial phases of the relationship.  Both of these may change over time (as
specified in the terms and conditions).  The process may change if we learn
better ways to work together.  The desired functionality will change as the
market for speech products evolves (both within and outside of AT&T).

PROCESS

The overall goal is to combine the technologies of SpeechWorks and AT&T Labs to
create a SpeechWorks Integrated Speech Product which best satisfies the needs of
the market (both within and outside of AT&T).  The needs of the market can be
characterized by a number of desired features or capabilities of the SpeechWorks
Integrated Speech Product. These desired features and capabilities could be
satisfied through a variety of means.  The following process will be used to
define and develop the best implementation of these desired features and
capabilities:

1.   The project managers from AT&T and SpeechWorks will agree on desired
     functionality, characteristics and target platforms of the SpeechWorks
     Integrated product.  This should be driven by requirements from the market
     (both within and outside of AT&T). These requirements will of course change
     over time, but based on information at any given point in time, the project
     managers from AT&T and SpeechWorks will agree on a current set of
     priorities.

2.   Define tests to measure how well the SpeechWorks Integrated Speech Product
     is meeting the desired needs.  We will use these tests to measure where we
     are at any point in time in meeting the requirements of the market.  The
     job of the SpeechWorks development team will be to optimize performance on
     these tests, so it is important that the tests truly reflect the needs in
     the marketplace, both current and immediately predictable (e.g. IP based).

3.   Measure performance of the current SpeechWorks Integrated Engine and the
     performance of any available technologies from SpeechWorks and AT&T on the
     tests defined in #2.  The methods for measuring the impact of individual
     component technologies will vary depending on the technology and the
     capability to be measured, but the goal will be to determine the best
     available technology or combination of technologies for any individual
     product requirement.

4.   Based on these evaluations, SpeechWorks will work with AT&T to determine
     the best approach to getting individual technology components into the
     SpeechWorks Integrated Speech Product.  These enhancements would either be
     targeted to a particular

                              Exhibit C - Pg. 1.
<PAGE>

     SpeechWorks product release (and controlled by the SpeechWorks release
     schedule), or could be done as part of special releases driven by deals
     with AT&T business units.

5.   SpeechWorks is responsible for developing the SpeechWorks integrated
     technology components as defined above and for formal testing of  the
     resulting SpeechWorks Integrated Speech Product on tests defined in #2.

INITIAL DESIRED FUNCTIONALITY

The initial joint work on the SpeechWorks Integrated engine will fall into three
broad categories:

1.   Support for "How May I Help You (HMIHY) Dialog Systems".  Current
     SpeechWorks applications use a combination of machine-initiative dialogs
     with limited use of natural language processing.  There is a class of
     applications that require a much greater user initiative.  Applications
     such as call routing or help desk must allow the user to specify their
     request in an open manner, since the user may be unable to map their need
     onto the structure of a more machine-directed system.  AT&T has developed
     natural language and dialog management technologies to enable such open-
     ended dialogs for this class of applications.  A key initial target will be
     to include this functionality in the SpeechWorks Integrated Speech Product.
     The tests used [     ].  The metrics used for evaluation will be those that
     are related to the overall success of such applications. SpeechWorks will
     integrate AT&T's speech recognition, spoken language understand and dialog
     management technologies, which support this class of applications, into the
     product and make it available for customers within [     ].

2.   Large name list recognition (of approximately [     ] names).  The target
     applications for this include [     ].  In addition to being able to handle
     very large name lists, the SpeechWorks Integrated Speech Product needs to
     have the ability to [     ].  Tests for this capability will come from
     [     ], [     ].

3.   Overall recognition performance on current SpeechWorks capabilities.
     SpeechWorks measures product performance (accuracy, computation, and
     rejection) on a fairly extensive product test suite.  SpeechWorks and AT&T
     will work together to make sure that the SpeechWorks Integrated engine has
     the best combination of available technologies for optimizing performance
     on this suite of tests.

To satisfy the initial requirement set, as listed above, the recognition tasks
to be defined and used for performance measurements will include:

 .  [     ]
 .  [     ] ([     ]) [     ]
 .  [     ] ([     ])
 .  [     ]
 .  [     ]
 .  [     ]
 .  [     ]
 .  [     ] ([     ])

                              Exhibit C - Pg. 2.
<PAGE>

 .  [     ]
 .  [     ]
 .  [     ] ([     ])
 .  [     ]
 .  "How May I Help You" capabilities [     ]

The initial quality requirements to be met by SpeechWorks for TSS synthesized
speech include:

 .  [     ]

[     ] PRODUCTIZATION PLAN.

SpeechWorks will provide a product incorporating AT&T's TTS Software engine and
female and male voices within [     ] ([     ]) [     ] of [     ] Software and
will integrate [     ] ([     ]) [     ].

                              Exhibit C - Pg. 3.
<PAGE>

                                   EXHIBIT D

                            AT&T BRANDING GUIDELINES

          AT&T generally requires the use of special guidelines when the AT&T
LABS name is used in connection with certain technology so as to clearly define
the nature of the AT&T/SpeechWorks relationship.

          The AT&T LABS BRANDING.
          The "AT&T Labs Branding" refers to the "POWERED BY AT&T LABS
TECHNOLOGY" slogan or some other mutually agreeable terms (hereinafter "SLOGAN")
Placement of AT&T LABS Branding.

PACKAGING / MEDIA:  If the SpeechWorks Integrated Speech Product is distributed
in non-electronic form, then the Slogan must be displayed on the lower-right
corner of the back or front of the packaging which contains the media, subject
to the prohibitions recited below.

          Usage of AT&T Labs Branding

POSITION OF LOGO.  The SpeechWorks logos should be at least double the size of
the Slogan and adequate spacing between the Slogan and the SpeechWorks brand
should always be maintained. The Slogan may only appear in the size that it was
originally provided by AT&T.

SCALING.  The Slogan shall appear centered on top of any logo in a font (10
point minimum and a total of 25 characters) that is consistent with the rest of
the SpeechWorks web site and marketing materials.  The distance from the top of
any logo to the baseline of the qualifying phrase is 10 points.

     Other requirements

LICENSE TO USE.  AT&T grants SpeechWorks a personal, non-exclusive, non-
transferable, non-assignable, limited right to use the Slogan solely in
accordance with this Agreement.  If SpeechWorks breaches any requirement of this
Agreement, including failing to use the Slogan in a manner which these
Guidelines state that SpeechWorks must, then such failure shall be considered a
breach of this Agreement.  Notwithstanding the foregoing, the Slogan may never
be used in connection with services or products that do not contain AT&T
technology.  Other than as expressly set forth herein, nothing in this Agreement
shall be construed as conferring upon SpeechWorks any right to use in any manner
any reference to any AT&T Marks or any other indicia of origin owned by AT&T or
to indicate that SpeechWorks' products or services are in any way sponsored,
approved or endorsed by AT&T. AT&T does not grant, and SpeechWorks does not
have, any right to grant or purport to grant any sublicense to the Slogan.

NO ALTERATIONS.  The Slogan must always be used in the original form as created
and delivered by AT&T.  SpeechWorks may not alter the Slogan in any way.

                              Exhibit D - Pg. 1.
<PAGE>

SPECIMENS.  SpeechWorks must submit specimens of all screen shots of the
SpeechWorks Integrated Speech Product and other materials (including marketing
literature) which include the Slogan, prior to their publication.  If AT&T
determines that SpeechWorks' use of the Slogan conflicts with or is not
expressly permitted by this Agreement, then AT&T shall advise SpeechWorks of
same and SpeechWorks shall not distribute the materials to any third party until
appropriate corrective action is taken to the satisfaction of AT&T.  If AT&T
fails to communicate its approval or disapproval of a specimen within [     ]
([    ]) [    ] after receipt, and if SpeechWorks has used Reasonable Efforts to
verbally inform AT&T that SpeechWorks did not hear from AT&T during such [     ]
([     ]) [     ] period, and if the specimen does not conflict with these
Guidelines, then the specimen shall be deemed approved.  Upon approval by AT&T
of a specified specimen for a specific purpose, SpeechWorks may make reprints or
updated versions of such specimen without AT&T approval, provided that, the
format of the Slogan in the specimen has not been changed, modified or otherwise
altered.   Materials shall not be altered without the prior written approval of
AT&T. Such specimens shall be sent in an email containing the subject line
"Request for Slogan Approval" to the following address:

          Name: [     ]
          AT&T Brand Management
          295 N. Maple Ave.
          Basking Ridge, NJ 07920
          Room [     ]
           [     ]
          ([     ]) [     ]-[     ]

PRE-APPROVED SPECIMENS

Specimens to be mutually agreed within [     ] ([     ]) days of the Effective
Date.

COOPERATION.  SpeechWorks agrees to execute all papers reasonably requested by
AT&T to effect further registration of, maintenance and renewal of the Slogan in
connection with licenses granted hereunder and, where applicable, to record
SpeechWorks as a registered user of the Slogan.

DIFFERENTIATION.  Notwithstanding any other provision of these Guidelines,
SpeechWorks' use of the Slogan must accurately represent the relationship
between AT&T and SpeechWorks as licensor/SpeechWorks and must not foster any
misleading or mistaken belief that AT&T is jointly providing a service or
product with SpeechWorks.

ACKNOWLEDGMENTS.  SpeechWorks acknowledges and agrees that: it will not register
or apply for, and that it has not registered or applied for, any name or mark
confusingly similar to the Slogan in any country; that it will not use the
Slogan, or any mark confusingly similar thereto, as part of its corporate name
or trade name; that it will not obtain any ownership interest in the Slogan or
any other right or entitlement to continued use of the Slogan, regardless of how
long this Agreement remains in effect and regardless of any reason or lack of
reason for the termination thereof by AT&T; that any and all goodwill and other
rights that may be acquired by the use of the Slogan shall inure to the sole
benefit of AT&T; and that SpeechWorks will not

                              Exhibit D - Pg. 2.
<PAGE>

challenge the ownership or validity of the Slogan; and AT&T MAKES NO WARRANTIES,
EXPRESS OR IMPLIED, REGARDING THE SLOGAN, INCLUDING THE OWNERSHIP, VALIDITY OR
NON-INFRINGEMENT THEREOF.

LEGENDS AND NOTICES.  AT&T may require SpeechWorks to include a notice on any
product, item or service upon which SpeechWorks uses the Slogan in order to
identify the licenses granted hereunder and the proprietary rights of AT&T.

PROHIBITED USES. SpeechWorks shall not use the Slogan in connection with the
SpeechWorks Integrated Speech Product to create any documents or in connection
with any information which: (a) violates any applicable federal, state or local
law of the United States or any foreign country having jurisdiction or (b)
violates the property rights of others, including unauthorized copyrighted text,
images or programs, trade secrets or other confidential proprietary information,
or trademarks or service marks used in an infringing fashion. None of the
foregoing limitations shall be construed in a manner to expand any licenses
granted hereunder. SpeechWorks shall not use the Slogan on any content that in
AT&T's reasonable opinion:

 .  Relates to illegal activities;
 .  Demeans, ridicules or attacks an individual or group on the basis of age,
   color, national origin, race, religion, sex, sexual orientation or handicap;
 .  Is pornographic, obscene, vulgar or sexually explicit/suggestive;
 .  Relates to tobacco and/or alcoholic beverages;
 .  Relates to firearms, ammunition and/or fireworks;
 .  Relates to gambling;
 .  Relates to contraceptives;
 .  Relates to violence;
 .  Includes vulgar, obscene language; or
 .  Relates to the solicitation of funds (excluding legal electronic commerce).

LIMIT OF GUIDELINES.  These Guidelines pertain only to the Slogan.  Nothing in
these Guidelines may be construed as conveying any other rights to SpeechWorks,
including intellectual property rights or the right to provide any software
mentioned herein. The terms of the License Agreement shall prevail over any
conflicting terms of these Guidelines.

CHANGES TO GUIDELINES.  AT&T may modify the Guidelines from time-to-time in its
sole discretion, including changing web site designations and contact
information.  If AT&T makes a material change to the manner of use set forth in
the Guidelines despite SpeechWorks' written objections, SpeechWorks shall have
[     ] ([     ]) days after receiving notice of such change to terminate this
Agreement.

QUALITY CONTROL.    IF AT&T DETERMINES IN ITS REASONABLE SOLE DISCRETION THAT
THE PRODUCTS, SERVICES OR MATERIALS PROVIDED BY SPEECHWORKS HEREUNDER ARE
INCONSISTENT WITH AT&T'S INTENTIONS FOR ITS MARKS, THEN AT&T MAY IMMEDIATELY
TERMINATE THE SPEECHWORKS' RIGHTS AND OBLIGATIONS UNDER THIS AGREEMENT UPON
WRITTEN NOTICE TO SPEECHWORKS.

                              Exhibit D - Pg. 3.
<PAGE>

     Questions and requests for changes

     If SpeechWorks has any questions or requested changes to these Guidelines
     (such as size requirements), please contact [           ] at the above-
     identified location. These Guidelines cannot be changed or waived except by
     a writing signed by AT&T.

                              Exhibit D - Pg. 4.
<PAGE>

                                   EXHIBIT E

                              EQUITY CONSIDERATION

                        COMMON STOCK PURCHASE AGREEMENT

     This Common Stock Purchase Agreement dated as of June 5, 2000 is entered
into by and between SpeechWorks International, Inc., a Delaware corporation (the
"Company"), and AT&T Corp., a New York corporation ("AT&T").

     WHEREAS, on the date hereof the Company and AT&T are entering into a
Development and License Agreement (the "License Agreement") pursuant to which
AT&T will license certain technology (the "Technology") to the Company in
exchange for shares of common stock of the Company as specified herein; and

     NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the receipt and sufficiency of which are hereby acknowledged,
parties hereto agree as follows:

Issuance of the Common Stock.

     In consideration of the license of the Technology by AT&T to the Company,
the Company agrees to issue to AT&T (i) 1,045,158 shares (the "Shares") of the
Company's common stock, $0.001 par value per share (the "Common Stock").  Such
issuance shall take place at a closing (the "Closing") to be held at Mintz,
Levin, Cohn, Ferris, Glovsky and Popeo, P.C., on June 5, 2000 at 10:00 a.m., or
on such other date and at such time as may be mutually agreed upon by the
Company and AT&T.  Subject to the satisfaction of the conditions set forth in
Section 5 hereof, at the Closing the Company will issue and deliver a
certificate evidencing the Shares to AT&T registered in the name of AT&T.

     1.  Representations of the Company.  The Company hereby represents and
warrants to the AT&T as follows:

     (a) Organization and Standing.  The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has full corporate power and authority to conduct its business as
presently conducted and as proposed to be conducted by it and to enter into and
perform this Agreement and to carry out the transactions contemplated by this
Agreement.  The Company is duly qualified to do business as a foreign
corporation and is in good standing in The Commonwealth of Massachusetts and in
every other jurisdiction in which the failure to so qualify would have a
material adverse effect on the operations or financial condition of the Company
and its subsidiaries taken as a whole.

     (b) Capitalization.  The authorized capital stock of the Company consists
of 35,000,000 shares of Common Stock, of which 6,000,103 shares were outstanding
as of May 31, 2000, and 11,791,662 shares of Preferred Stock, $0.001 par value
per share (the "Preferred Stock") consisting of 2,475,000 shares of Series A
Convertible Participating Preferred Stock,

                              Exhibit E - Pg. 1.
<PAGE>

$0.001 par value per share, all of which shares are issued or outstanding as of
the date hereof, 2,474,500 shares of Series B Convertible Preferred Stock,
$0.001 par value per share, all of which shares are issued and outstanding as of
the date hereof, 1,626,092 shares of Series C Convertible Preferred Stock,
$0.001 par value per share, all of which shares are issued and outstanding as of
the date hereof, 2,671,389 shares of Series D Convertible Preferred Stock,
$0.001 par value per share, all of which shares are issued and outstanding as of
the date hereof and 2,544,681 shares of Series E Convertible Preferred Stock,
$0.001 par value per share, all of which shares are issued and outstanding as of
the date hereof. All of the issued and outstanding shares of Common Stock and
Preferred Stock have been duly authorized and validly issued and are fully paid
and nonassessable. The Shares, when issued and delivered in accordance with the
terms hereof, will be duly authorized, validly issued and fully paid and
nonassessable. Except as set forth in Schedule 2(b), there are no options,
warrants or rights to purchase shares of the Company's capital stock. Except as
provided for in the Company's Certificate of Incorporation, the Company is not
subject to any obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any shares of its capital stock. Except as set forth in the
Company's Fourth Amended and Restated Stockholders Agreement, dated as of April
11, 2000, as amended, no holder of any security of the Company is entitled to
preemptive or similar statutory or contractual rights, either arising pursuant
to any agreement or instrument to which the Company is a party or that are
otherwise binding upon the Company. The rights, privileges and preferences of
the Series A Preferred Stock, Series B Preferred Stock, Series C Preferred
Stock, Series D Preferred Stock and Series E Preferred Stock are as stated in
the Certificate of Incorporation.

     (c) Issuance of the Shares.  The issuance of the Shares in accordance with
this Agreement have been duly authorized by all necessary corporate action on
the part of the Company.

     (d) Authority for Agreement.  The execution, delivery and performance by
the Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate action.  This Agreement has been duly executed and delivered
by the Company and constitutes the valid and binding obligation of the Company
enforceable in accordance with its terms.  The execution of and performance of
the transactions contemplated by this Agreement and compliance with the
provisions hereof by the Company will not violate any provision of law and will
not conflict with or result in any breach or violation of any of the terms,
conditions or provisions of, or constitute a default under, or require a consent
or waiver under, its Certificate of Incorporation or By-Laws (each as amended to
date) or any mortgage, indenture, lease, material agreement or other instrument
to which the Company is a party or by which it or any of its properties is
bound, or any decree, judgment, order, statute, rule or regulation applicable to
the Company.  The Company is not in violation or default of any term of its
Certificate of Incorporation or Bylaws, or any provision of any mortgage,
indenture, lease, agreement, or other instrument to which it is party or by
which it is bound.

     (e) Governmental Consents.  No consent, approval, order or authorization
of, or registration, qualification, designation, declaration or filing with, any
governmental authority is required on the part of the Company in connection with
the execution and delivery of this Agreement or the issuance and delivery of the
Shares.  Based on the representations made by AT&T in Section 3 hereof, the
issuance and delivery of Shares to AT&T is in compliance with applicable federal
and state securities laws.

                              Exhibit E - Pg. 2.
<PAGE>

     (f) Litigation.  There is no action, suit, proceeding, governmental inquiry
or investigation pending or, to the best of the Company's knowledge, currently
threatened against the Company that questions the validity of this Agreement or
the License Agreement or the right of the Company to enter into them, or to
consummate the transactions contemplated hereby or thereby, or that might
reasonably result, either individually or in the aggregate, in any material
adverse changes in the business, assets, condition, prospects or affairs of the
Company, financially or otherwise, or any change in the current equity ownership
of the Company.  The Company is not a party or subject to the provisions of any
order, writ, injunction, judgment or decree of any court or government agency or
instrumentality.  There is no action, suit, proceeding or investigation by the
Company currently pending or which the Company intends to initiate that might
reasonably result either individually or in the aggregate, in any material
adverse changes in the assets, condition prospects or affairs of the Company,
financially or otherwise.

     (g) Intellectual Property.  To the best of the Company's knowledge, the
Company owns or has a valid right to use the patents, patent rights, licenses,
trade secrets, trademarks, trademark rights, trade names or trade name rights,
domain names or franchises, copyrights, inventions, and intellectual property
rights necessary to the conduct of the business as now operated or proposed to
be operated (the "Company's Intellectual Property") and, to the best of the
Company's knowledge, except as described in the Disclosure Schedule, the
Company's Intellectual Property (including embodiments thereof) does not violate
licenses or conflict with or violate valid patents, patent rights, trade
secrets, trademarks, trademark rights, trade names or trade name rights, domain
names or franchises, copyrights or intellectual property rights of others.  All
licenses and other agreements relating to the Company's Intellectual Property
Rights are in full force and effect without default by the Company or to the
best of the Company's knowledge by any party thereto.  To the best of the
Company's knowledge, no officer or employee of the Company is, or is now
expected to be, in violation of any term of any employment contract, patent
disclosure agreement, non-competition agreement, or any other contract or
agreement or any restrictive covenant relating to the right of any such officer
or employee to be employed by the Company because of the nature of the business
conducted or to be conducted by the Company or relating to the right of any such
officer or employee to be employed by the Company because of the nature of the
business conducted or to be conducted by the Company or relating to the use of
trade secrets or proprietary information of others.  Each employee, officer,
consultant and contractor of the Company has entered into and executed the
Company's standard form Non-Disclosure and Development Agreement and such
agreements are in full force and effect.

     (h) Financial Statements.  The Company has delivered to AT&T its (a)
audited financial statements (including balance sheet, statement of
shareholders' equity/income statement and statement of cash flows) as of and for
the twelve-month period ended December 31, 1999 (the "Audited Balance Sheet
Date"), together with a report thereon, from the Company's independent auditors,
and (b) unaudited financial statements (included balance sheet, statement of
shareholders' equity/income statement and statement of cash flows) as of and for
the three-month period ended March 31, 2000 (collectively, the "Financial
Statements").  The Financial Statements have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis
throughout the periods indicated, except that the unaudited Financial Statements
may not contain all footnotes required by generally accepted

                              Exhibit E - Pg. 3.
<PAGE>

accounting principles. The Financial Statements fairly present the financial
condition and operating results of the Company as of the dates, and for the
periods, indicated therein.

     (i) Changes.  Since March 31, 2000, there has not been

          (i) any change in contracts, assets, liabilities, financial condition
or operating results of the Company from that reflected in the Financial
Statements, except changes in the ordinary course of business that have not
been, in the aggregate, materially adverse;

          (ii) any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the business, properties,
prospects, or financial condition of the Company, as such business is presently
conducted and as it is proposed to be conducted.

          (iii)  except as set forth on the Disclosure Schedule, any
declaration, setting aside or payment or other distribution in respect to any of
the Company's capital stock, or any direct or indirect redemption, purchase, or
other acquisition of any of such stock by the Company;

          (iv) any material change in any compensation arrangement or agreement
with any employee, officer, director or shareholder;

          (v) any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets or other intangible assets;

          (vi) any other event or condition of any character that might
materially and adversely affect the business, properties, prospects or financial
condition of the Company (as such business is presently conducted and as it is
proposed to be conducted); or

          (vii)  any arrangement or commitment by the Company to do any of the
things described above in this Section.

     (j) Title to Property and Assets.  The Company owns its property and assets
free and clear of all mortgages, liens, loans, claims and encumbrances, except
such encumbrances and liens which arise in the ordinary course of business and
do not materially impair the Company's ownership or use of such property or
assets.  With respect to the property and assets it leases, the Company is in
compliance with such leases and, to its knowledge, holds a valid leasehold
interest free of any liens, claims or encumbrances.

     (k) Insurance.  The Company has in full force and effect insurance policies
customary for similarly situated companies in the same or similar business as
the Company.

     (l) Taxes.  All federal, state, local and foreign tax returns required to
be filed by the Company have been filed, or if not yet filed have been granted,
extensions of the filing dates, which extensions have not expired, and all
taxes, assessments, fees, and other governmental charges upon the Company, or
upon any of its properties, income or franchises, shown in such returns and on
assessments received by the Company to be due and payable have been paid, or
adequate reserves therefor have been set up and have been disclosed in the
Company's financial statements.  No such taxes are being contested.

                              Exhibit E - Pg. 4.
<PAGE>

     (m) Brokers.  The Company represents that no person, firm or corporation
has or will have, as a result of any act or omission by it, any right, interest
or valid claim against AT&T for any commission, fee or other compensation as a
finder or broker, or in any similar capacity, in connection with the
transactions contemplated by this Agreement.

     (n) Employees.  To the Company's knowledge, there is no strike, labor
dispute or union organization activities pending or threatened between it and
its employees and none of the Company's employees belongs to any union or
collective bargaining unit.  The Company has complied in all material respects
with all applicable state and federal equal opportunity and other laws related
to employment.  The Company is presently not aware that any officer or key
employee, or that any group of key employees, intends to terminate their
employment with the Company, nor does the Company have a present intention to
terminate the employment of any of the foregoing.

     (o) Acquisitions.  The Company has not engaged in the past six months in
any substantive discussions (i) with any representative of any person or entity
regarding the consolidation or merger of the Company with or into any such
person or entity, (ii) with any person or entity regarding the sale, conveyance
or disposition of all or substantially all of the assets of the Company or a
transaction or series of related transactions in which more than 50 percent of
the voting power of the Company would be disposed of or (iii) regarding any
other form of acquisition, liquidation, dissolution or winding up of the
Company.

     (p) Disclosure.  None of the information provided to AT&T in connection
with the transactions contemplated by this Agreement or the License Agreement,
nor any representation or warranty of the Company contained in this Agreement
and the exhibits and schedules attached hereto or any certificate furnished or
to be furnished to AT&T at the Closing contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statements contained herein or therein not misleading in light of the
circumstances under which they were made.

     2.  Representations of AT&T.  AT&T hereby represents and warrants to the
Company as follows:

     (a) Investment.  AT&T is acquiring the Shares only for its own account for
investment purposes and not with a view to, or for sale in connection with, any
distribution thereof, nor with any present intention of distributing or selling
the same.

     (b) Authority.  AT&T has full power and authority to enter into and to
perform this Agreement in accordance with its terms.  This Agreement has been
duly executed and delivered on behalf of AT&T and is a valid and binding
agreement enforceable against AT&T in accordance with its terms.

     (c) Experience.  AT&T has reviewed the representations concerning the
Company contained in this Agreement, has made a detailed inquiry concerning the
Company, its business and its personnel; the officers of the Company have made
available to AT&T any and all written information which it has requested and
have answered to AT&T's satisfaction all inquiries made by AT&T and AT&T has
sufficient knowledge and experience in investing in companies similar to the
Company so as to be able to evaluate the risks and merits of its investment in
the Company.

                              Exhibit E - Pg. 5.
<PAGE>

     (d) Accredited Investor.  AT&T is an "accredited investor" within the
meaning of Regulation D promulgated under the Securities Act of 1933, as amended
(the "Securities Act").

     (e) Legend.  AT&T understands and agrees that (i) the Shares have not been
registered under the Securities Act by reason of their issuance in a transaction
exempt from the registration requirements of the Securities Act, (ii) the Shares
must be held indefinitely unless a registration statement covering such shares
is effective under the Securities Act or unless an exemption from registration
under such Act is available, (iii) the Shares will bear a legend to that effect
and (iv) the Company will make a notation on its transfer books to such effect.

     (f) Brokers.  AT&T represents that no person, firm or corporation has or
will have, as a result of any act or omission by it, any right, interest or
valid claim against the Company for any commission, fee or other compensation as
a finder or broker, or in any similar capacity, in connection with the
transactions contemplated by this Agreement.

     3.  Closing Conditions.

     (a) Conditions to the Company's Obligations.  The Company's obligation to
issue and deliver the Shares to AT&T at the Closing is subject to the
satisfaction by AT&T of the following conditions:

          (i) The Company and AT&T shall have executed the License Agreement;
and

          (ii) AT&T shall have executed the Lock-Up Agreement in the form
attached as Exhibit E-1 hereto.

     (b) Conditions to AT&T's Obligations.  AT&T's obligation to license the
Technology to the Company and to purchase the Shares at the Closing is subject
to the satisfaction by the Company of the following conditions:

          (i) The Company shall have obtained all consents or waivers,
including, without limitation, required waivers of preemptive and first refusal
rights with respect to the issuance of the Shares necessary to execute and
deliver this Agreement, issue the Shares to carry out the transactions
contemplated hereby and thereby, and all such consents and waivers shall be in
full force and effect.  All corporate and other action and governmental filings
necessary to effectuate the terms of this Agreement, the Shares, and other
agreements and instruments executed and delivered by the Company in connection
herewith shall have been made or taken, except for any post-sale filings that
may be required under federal and state securities laws, as to which filings the
Company agrees to make promptly after such Closing;

          (ii) The Company, AT&T and the holders of the requisite number of
shares of Registrable Stock (as defined in the Company's Fourth Amended and
Restated Registration Rights Agreement) shall have executed the Second Amendment
to the Company's Fourth Amended and Restated Registration Rights Agreement in
the form Attached as Exhibit E-2 hereto;

          (iii)  The Company and AT&T shall have executed the License Agreement;
and

          (iv) The Company shall have performed and complied with all covenants,
agreements, obligations and conditions contained in this Agreement and in the
Agreements

                              Exhibit E - Pg. 6.
<PAGE>

referenced herein that are required to be performed or complied with by it on or
before the Closing.

          (v) On the Closing Date, AT&T shall have received from Mintz, Levin,
Cohn, Ferris, Glovsky and Popeo, P.C., counsel to the Company, an opinion in the
form and substance reasonable satisfactory to AT&T and its counsel.

          (vi) AT&T shall have received copies of a certificate from the
Secretary or any Assistant Secretary of the Company dated as of the date of the
Closing certifying:  (1) that attached thereto is a true and complete copy of
the By-laws of the Company as in effect on the date of such certification; (2)
that attached thereto is a true and complete copy of all resolutions and votes
adopted by the Board of Directors of the Company authorizing the execution,
delivery and performance of this Agreement, and the License Agreement and the
transactions contemplated hereby and thereby and that all such votes are in full
force and effect; (3) that attached thereto is a true and complete copy of the
Certificate of Incorporation of the Company, certified as of a recent date by
the Secretary of State of Delaware and is in effect on the date of such
certification and that the Certificate of Incorporation has not been amended
since the date of the certificate of the Secretary of State of Delaware; and (4)
to the incumbency and specimen signature of each officer of the Company executed
on behalf of the Company this Agreement and the License Agreement, the stock
certificates representing the Shares and any certificate or instrument furnished
pursuant in connection herewith and therewith, and a certification by another
officer of the Company as to the incumbency and signature of the officer signing
the certificate referred to in this clause.

     4.  General.

     (a) Notices. All notices, requests, demands and other communications
provided for hereunder shall be in writing and sent by registered or certified
mail, by any guaranteed overnight delivery service, or by facsimile transmission
delivered to the applicable party in person or at the addresses indicated below:

  If to the Company:      SpeechWorks International, Inc.
                          695 Atlantic Avenue
                          Boston, MA 02111
                          Attn:  Stuart R. Patterson, President
                          Fax:  (617) 757-2211

  With copies to:         SpeechWorks International, Inc.
                          695 Atlantic Avenue
                          Boston, MA 02111
                          Attn:  Rick Olin, General Counsel
                          Fax: (617) 757-2211

  With copies to:         Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
                          One Financial Center
                          Boston, Massachusetts  02111
                          Attn:  Steven P. Rosenthal, Esq.
                          Fax: (617) 542-2241

                              Exhibit E - Pg. 7.
<PAGE>

  If to AT&T:             AT&T Corp.
                          180 Park Avenue
                          P.O. Box 971
                          Florham, NJ  07932-0000
                          Attn: Alan Schwartz
                          Fax:

  With copy to:           AT&T Corp.
                          295 North Maple Avenue
                          Basking Ridge, New Jersey 07920
                          Attention:  VP Law and Secretary
                          Telecopy:  (908) 221-6618

or as to each of the foregoing, at such other address as shall be designated by
such person in a written notice to the other party complying as to delivery with
the terms of this Section.

All notices, requests, consents and other communications hereunder shall be
deemed to have been received (i) if by hand, at the time of delivery thereof to
the receiving party at the address of such party set forth above or as so
designated, (ii) if made by facsimile transmission, at the time that receipt
thereof has been acknowledged by electronic confirmation or otherwise, (iii) if
sent by overnight courier, on the next business day following the day such
notice is delivered to the courier service, or (iv) if sent by registered or
certified mail, on the fifth business day following the day such mailing is
made.

     (b) Entire Agreement.  This Agreement embodies the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and understandings relating to such
subject matter.

     (c) Amendments and Waivers.  Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), with the
written consent of the Company and AT&T.  No waivers of or exceptions to any
term, condition or provision of this Agreement, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such term, condition or provision.

     (d) Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
shall be one and the same document.

     (e) Severability.  The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

     (f) Governing Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.

                          [Signature page to follow]

                              Exhibit E - Pg. 8.
<PAGE>

IN WITNESS WHEREOF, the parties have caused this Common Stock Purchase Agreement
to be executed as of the date first written above.

                              SPEECHWORKS INTERNATIONAL, INC.

                              By:_____________________________________
                              Name:
                              Title:

                              AT&T CORP.

                              By:_____________________________________
                              Name:
                              Title:

                              Exhibit E - Pg. 9.
<PAGE>

                       DISCLOSURE SCHEDULE TO AT&T COMMON

                            STOCK PURCHASE AGREEMENT

SECTION 2(b): CAPITALIZATION; STATUS OF CAPITAL STOCK.  A complete list (dated
as of 5/31/00) of stockholders, option holders, and warrant holders, and their
respective holdings is attached.

SECTION 2(h): INTELLECTUAL PROPERTY.  The Company has received a letter from
Mason's a firm representing an entity that is the owner of the registered
Trademark "Speechworks" in the United Kingdom. The Company has initiated
negotiations with the owners; however, no assurance can be given at this time
that an amicable resolution can be attained, in which case the Company will have
to determine alternative branding for that territory.

SECTION 2(j)(iii): CHANGES.     The Company granted "SOAR" option grants to
employees in May, 2000, all of which are reflected on the attached
Capitalization table.

Matters set forth under any one or more sections of this Disclosure Schedule or
with respect to any particular reference to the Agreement are disclosed with
respect to any other section of the Disclosure Schedule or any other reference
to the Agreement if such matter is directly related to such other section or
reference.  Capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Agreement. All section numbers of this Disclosure
Schedule correspond to the relevant sections in the Agreement.

                              Exhibit E - Pg. 10.
<PAGE>

                                  EXHIBIT E-1

                           FORM OF LOCK-UP AGREEMENT

Chase Securities Inc.
J. P. Morgan & Co.
U. S. Bancorp Piper Jaffray
As Representatives of the
  Several Underwriters
c/o Chase Securities Inc.
One Bush Street
San Francisco, California 94104

Ladies and Gentlemen:

     The undersigned is a shareholder of SpeechWorks International, Inc. (the
"Company") and wishes to facilitate the public offering (the "Offering") of
Common Stock of the Company ("Common Stock") pursuant to a Registration
Statement on Form S-1 (the "Registration Statement"), transmitted for filing
with the Securities and Exchange Commission on or about April 20, 2000.

     In consideration of the foregoing, and in order to induce you to act as
underwriters in the Offering, the undersigned hereby irrevocably agrees that it
will not, directly or indirectly, sell, offer, contract to sell, transfer the
economic risk of ownership in, make any short sale, pledge or otherwise dispose
of any shares of Common Stock or any securities convertible into or exchangeable
or exercisable for or any other rights to purchase or acquire Common Stock,
without the prior written consent of Chase Securities Inc. acting alone or of
each of the Representatives of the Underwriters acting jointly, for a period of
180 days from the effective date of the Registration Statement.

     Notwithstanding the foregoing, if the undersigned is an individual, he or
she may transfer any shares of Common Stock or securities convertible into or
exchangeable or exercisable for the Company's Common Stock either during his or
her lifetime or on death by will or intestacy to his or her immediate family or
to a trust the beneficiaries of which are exclusively the undersigned and/or a
member or members of his or her immediate family; provided, however, that prior
to any such transfer each transferee shall execute an agreement, satisfactory to
Chase Securities Inc., pursuant to which each transferee shall agree to receive
and hold such shares of Common Stock, or securities convertible into or
exchangeable or exercisable for the Common Stock, subject to the provisions
hereof, and there shall be no further transfer except in accordance with the
provisions hereof.  For the purposes of this paragraph, "immediate family" shall
mean spouse, lineal descendant, father, mother, brother or sister of the
transferor.

     It is agreed and understood that nothing in this agreement shall prohibit
the undersigned from (1) exercising any stock option granted as a direct or
indirect result of any Company program (other than any form of "cashless"
exercise generally available for such grants), provided that the resulting
shares from stock exercise are not sold during the period of this agreement; (2)
transferring Common Stock to the acquiring entity in the event the Company is
consolidated with or acquired by another entity in a merger, tender offer or
otherwise; (3) using any Common Stock or stock options as collateral for a loan;
(4) transferring Common Stock to any affiliate, as such term is defined in Rule
405 under the Securities Act of 1933; and (5) selling

                              Exhibit E-1 - Pg. 1.
<PAGE>

any shares acquired in the open market, provided that such sale is an open
market non-derivative sale in the open market pursuant to a brokers'
transaction; provided that in the case of transfers under clauses (3) and (4)
that prior to any such transfer each transferee shall execute an agreement,
satisfactory to Chase Securities Inc., pursuant to which each transferee shall
agree to receive and hold such shares of Common Stock, or securities convertible
into or exchangeable or exercisable for the Common Stock, subject to the
provisions hereof, and there shall be no further transfer except in accordance
with the provisions hereof.

     If any shares held by a stockholder who is bound by a lock-up agreement
with you in connection with the Offering (an "Investor") are released (the
"Released Stockholder"), a number of shares held by each Investor shall be
released equal to the product of the number of shares held by such Investor
multiplied by a fraction, the numerator of which shall be equal to the number of
shares held by the Released Stockholder that were released and the denominator
of which shall be the total number of shares held by the Released Stockholders.

     The undersigned hereby waives any rights of the undersigned to sell shares
of Common Stock or any other security issued by the Company pursuant to the
Registration Statement, and acknowledges and agrees that for a period of 180
days from the effective date of the Registration Statement the undersigned has
no right to require the Company to register under the Securities Act of 1933
such Common Stock or other securities issued by the Company and beneficially
owned by the undersigned.

     The undersigned understands that the agreements of the undersigned are
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.  The undersigned agrees and consents to
the entry of stop transfer instructions with the Company's transfer agent
against the transfer of Common Stock or other securities of the Company held by
the undersigned except in compliance with this agreement.

                                  Very truly yours,
                                  AT&T CORP.

Dated:  June 5, 2000              By:__________________________________
                                  Name:
                                  Title:

                              Exhibit E-1 - Pg. 2.
<PAGE>

                                  EXHIBIT E-2

                                    FORM OF
                SECOND AMENDMENT TO FOURTH AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT

     THIS SECOND AMENDMENT, dated as of June 5, 2000 (the "Agreement"), to the
Fourth Amended and Restated Registration Rights Agreement dated as of April 11,
2000 as amended by the First Amendment thereto dated May 16, 2000 (the
"Registration Rights Agreement"), by and among SPEECHWORKS INTERNATIONAL, INC.,
a Delaware corporation (the "Company") and the stockholders of the Company named
therein, is by and among the Company and AT&T Corp. (the "New Investor") and the
persons named on the signature page hereto as Investors (collectively, the
"Investors").  All other capitalized terms used herein and not otherwise defined
have their respective meanings set forth in the Registration Rights Agreement.

     WHEREAS, the New Investor is acquiring this date 1,045,158 shares of the
Common Stock, $0.001 par value per share (the "Shares"), of the Company pursuant
to the terms of a certain Common Stock Purchase Agreement dated the date hereof
(the "Purchase Agreement");

     WHEREAS, the Purchase Agreement contemplates in Section 5 thereof that the
Registration Rights Agreement shall be amended to add the New Investor as a
party to the Registration Rights Agreement; and

     WHEREAS, the Investors who are signatories hereto hold in the aggregate a
sufficient number of shares of Registrable Stock to amend the Registration
Rights Agreement in accordance with Section 14 thereof to add the New Investor
as party thereto.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, the parties agree as follows:

     1.  Amendment to Schedule RRA (Revised).  From and after the date hereof,
Schedule RRA (Revised) to the Registration Rights Agreement is deleted and
replaced by Schedule RRA (2nd Revised), dated the date hereof and attached
hereto and the term "Investors" as used therein and herein shall mean and refer
to all the persons and entities identified on said Schedule RRA (2nd Revised).

     2.  Amendment to Definition of "Registrable Stock".  The definition of
"Registrable Stock" set forth in Section 1 of the Registration Rights Agreement
is hereby deleted and replaced by the following definition:

     "Registrable Stock" means (a) the Common Stock issued or issuable upon
conversion of the Series A Preferred Stock, Series B Preferred Stock, Series C
Preferred Stock, Series D Preferred Stock or Series E Preferred Stock, and owned
of record by any Investor or an Affiliate of any Investor; (b) all Common Stock
now or hereafter owned of record by any Investor which is acquired otherwise
than upon conversion of the Series A Preferred Stock, Series B Preferred Stock,
Series C Preferred Stock, Series D Preferred Stock or Series E Preferred Stock,
so long as it is held by any Investor or an Affiliate of the Investor, (c) all
the shares of Common Stock issued or issuable upon exercise of any warrant now
or hereafter held by Lighthouse, (d) all the shares of Common Stock issued or
issuable upon exercise of any warrant now or hereafter held

                              Exhibit E-2 - Pg. 1.
<PAGE>

by InterVoice-Brite, Inc., (e) all Common Stock now or hereafter owned by the
New Investor and (f) any other shares of Common Stock issued in respect of such
shares by way of a stock dividend, or stock split or in connection with a
combination of shares, recapitalization, merger or consolidation or
reorganization, provided, however, that shares of Common Stock shall only be
treated as Registrable Stock (i) if and so long as they have not been (x) sold
to or through a broker or dealer or underwriter in a public distribution or a
public securities transaction, or (y) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under
Section 4(1) thereof so that all transfer restrictions and restrictive legends
with respect to such Common Stock are removed upon the consummation of such
sale.

     3.  Continued Effect.  As amended hereby, the Registration Rights Agreement
is hereby ratified and confirmed and agreed to by all of the parties hereto and
continues in full force and effect.

     4.  Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

     5.  Governing Law.  This Agreement shall be governed by, and construed in
accordance with the laws of the State of Delaware.

                           [Signature pages follow]

                              Exhibit E-2 - Pg. 2.
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to
the Fourth Amended and Restated Registration Rights Agreement to be executed by
their respective officers thereunto duly authorized, as of the date first above
written.

                              SPEECHWORKS INTERNATIONAL, INC.

                              By:_______________________________________
                                   Stuart Patterson, President and Chief
                                   Executive Officer

                              NEW INVESTOR:

                              AT&T CORP.

                              By:_________________________________________
                              Name:
                              Title:

                              INVESTORS:

                              IGATE VENTURES I, L.P.

                              By:_________________________________________
                              Name:
                              Title:

                              REUTERS HOLDINGS SWITZERLAND SA

                              By:_________________________________________
                              Name:
                              Title:

                              CITICORP STRATEGIC TECHNOLOGY CORP.

                              By:_________________________________________
                              Name:
                              Title:

                              Exhibit E-2 - Pg. 3.
<PAGE>

                              GE CAPITAL EQUITY INVESTMENTS, INC.

                              By:_________________________________________
                              Name:
                              Title:

                              MCI WORLDCOM VENTURE FUND, INC.

                              By:_________________________________________
                              Name:
                              Title:

                              CHARLES RIVER PARTNERSHIP VII

                              By:_________________________________________
                              Name:
                              Title:

                              ATLAS VENTURE FUND II, L.P.

                              By: Atlas Venture Associates II, L.P., its
                                  general partner

                              By:_________________________________________
                              Name:
                              Title:

                              QUESTMARK PARTNERS, L.P.

                              By:_________________________________________
                              Name:
                              Title:

                              INTEL 64 FUND, LLC
                              By:  INTEL 64 FUND OPERATIONS, INC.,
                                   its Coordinating Member

                              By:_________________________________________
                              Name:
                              Title:

                              Exhibit E-2 - Pg. 4.
<PAGE>

                              BANK OF AMERICA VENTURES

                              By:_________________________________________
                              Name:
                              Title:

                              BA VENTURE PARTNERS III

                              By:_________________________________________
                              Name:
                              Title:

                              RIGGS CAPITAL PARTNERS

                              By:_________________________________________
                              Name:
                              Title:

                              MINTZ LEVIN INVESTMENTS LLC

                              By:_________________________________________
                              Name:
                              Title:

                              ____________________________________________
                              Steven P. Rosenthal

                              ____________________________________________
                              Suzanne Abair and Kathleen MacDonald

                              ____________________________________________
                              Robert S. Fore

                              Exhibit E-2 - Pg. 5.
<PAGE>

                              LEE CAPITAL HOLDINGS

                              By:_________________________________________
                              Name:
                              Title:

                              CITIZENS CAPITAL INCORPORATED

                              By:_________________________________________
                              Name:
                              Title:

                              ____________________________________________
                              JOSEPH MURPHY

                              DIGITAL BANDWIDTH LLC

                              By:_________________________________________
                              Name:  David B. Weinberg
                              Title: President

                              INTEL CORPORATION

                              By:_________________________________________
                              Name:
                              Title:

                              SAP AMERICA, INC.

                              By:_________________________________________
                              Name:
                              Title:

                              ____________________________________________
                              Paul Yovovich

                              ____________________________________________
                              Ralph Mor

                              Exhibit E-2 - Pg. 6.
<PAGE>

                              ____________________________________________
                              Hedva Mor

                              ____________________________________________
                              Jeffrey Mor

                              ____________________________________________
                              Jean Guy Dahan

                              ____________________________________________
                              Naim Murad

                              ____________________________________________
                              John Meyrick

                              ____________________________________________
                              Brett Phaneuf

                              ____________________________________________
                              William J. O'Farrell

                              __________________________________________
                              Noreen D. O'Farrell

                              ____________________________________________
                              William Ledingham

                              ____________________________________________
                              William Haney

                              ____________________________________________
                              Anne G. Haney

                              Exhibit E-2 - Pg. 7.
<PAGE>

                              LIGHTHOUSE CAPITAL PARTNERS, L.P.

                              By:  LIGHTHOUSE MANAGEMENT
                                   PARTNERS, L.P., its general partner

                              By:  LIGHTHOUSE CAPITAL
                                   PARTNERS, INC., its general partner

                              By:_________________________________________
                              Title:______________________________________

                              ____________________________________________
                              Mark Holthouse

                              ____________________________________________
                              Stephen Smith

                              ____________________________________________
                              Sol Lerner

                              ____________________________________________
                              Henry Lerner

                              ____________________________________________
                              Leonard Epstein

                              ____________________________________________
                              Bella Lerner

                              ____________________________________________
                              Miriam Epstein

                              ____________________________________________
                              Brian S. Eberman

                              ____________________________________________
                              Edward J. McCaffrey

                              ____________________________________________
                              Joyce V. McCaffrey

                              INTERVOICE-BRITE, INC.

                              By:_________________________________________
                              Name:
                              Title:

                              Exhibit E-2 - Pg. 8.
<PAGE>

                          Schedule RRA (2nd Revised)
                                  June 5, 2000

Investors and Mailing Addresses:

AT&T Corp.
[     ]

iGate Ventures I, L.P.
1004 McKee Road
Oakdale, PA 15071

Counsel:

Buchanan Ingersoll Professional Corporation
One Oxford Centre, 20th Floor
301 Grant Street
Pittsburgh, PA  15219
Attn: James J. Barnes, Esq.
(412) 562-1415
(412) 562-1041 (Fax)

Reuters Holdings Switzerland SA
153 Route de Thonon
1245 Collogne-Bellerive
Switzerland
(with copies to: Reuters Limited
85 Fleet Street
London EC4P 4AJ
United Kingdom
Attention:  General Counsel)

Citicorp Strategic Technology Corp.
909 Third Avenue,
16th Floor, New York, NY 10043
Attention: William F. Carson

GE Capital Equity Investments, Inc.
120 Long Ridge Road, Stamford, CT 06927
Attention:  General Counsel

MCI WorldCom Venture Fund, Inc.
1801 Pennsylvania Avenue N.W.
6th Floor
Washington D.C. 20006

                              Exhibit E-2 - Pg. 9.
<PAGE>

Mintz Levin Investments LLC
One Financial Center
Boston, MA  02111
Attention:  Steven P. Rosenthal, Esq.

Steven P. Rosenthal
40 Bartlett Street
Marblehead, MA  01945

Suzanne Abair & Kathleen MacDonald
16 Dartmouth Street
Boston, MA 02116

Atlas Venture Fund II, L.P.
222 Berkeley Street
Boston, MA 02116
Attention:  Axel Bichara

Charles River Partnership VII
1000 Winter Street
Suite 3300
Waltham, MA 02154
Attention:  Richard Burnes

Digital Bandwidth LLC
One First National Plaza
Suite 3140
Chicago, IL
Attention:  David B. Weinberg

Bank of America Ventures
950 Tower Lane, Suite 700
Foster City, CA  94404
Attention: Robert Obuch

BA Venture Partners III
950 Tower Lane, Suite 700
Foster City, CA  94404
Attention: Robert Obuch

Intel Corporation
5200 N.E. Elam Young Parkway
Hillsboro, OR  07123
Attention:  Ken Matthews

                              Exhibit E-2 - Pg. 10.
<PAGE>

SAP America, Inc.
3999 WestChester Pike
Newton Square,  PA 19073
Attention:  Gary Fromer

QuestMark Partners, L.P.
One South Street, Suite 800
Baltimore, Maryland  21202
Attention: Tim Krongard

Riggs Capital Partners
800 17th Street, N.W.
Washington, DC  20006-3944
Attention:  Vicken  Dombalagian

Intel 64 Fund Operations, Inc.
2200 Mission College Blvd.
Santa Clara, CA  95052
Attn:  Portfolio Manager - M/S: RN6-46
With a copy to:
Intel Corporation
2200 Mission College Blvd.
Santa Clara, CA  95052
Attention:  General Counsel

Robert S. Fore
520 Georgetown Avenue
San Mateo, CA  94402

Edward J. McCaffrey
23 Warwick Road
Winnetka, IL  60093

Joyce V. McCaffrey
23 Warwick Road
Winnetka, IL  60093

Paul Yovovich
1007 Forest Avenue
Wilmete, IL  60091-1757

Ralph Mor
11 Brook Road
Sharon, MA  02067

Hedva Mor
Rechov Hatziporen
6-Aleph
Bet Shemesh, ISRAEL   99000

                              Exhibit E-2 - Pg. 11.
<PAGE>

Jeffrey Mor
Rechov Hatziporen
6-Aleph
Bet Shemesh, ISRAEL  99000

Jean Guy Dahan
12 Colburne Crescent, Apt. #3
Brookline, MA  02146

Naim Murad
75 Glengarry #502
Town of Mount Royal, PQ
H3R 1A2
Canada

John Meyrick
22 Lotus Avenue
Scituate, MA  02066

Brett Phaneuf
380 Pine Street
Marshfield, MA  02050

William J. O'Farrell
76 Taber Avenue
Providence, RI  02906

Noreen D. O'Farrell
76 Taber Avenue
Providence, RI  02906

William Ledingham
15 Wingate Road
Wellesley, MA  02181

William Haney
61 Lincoln Road
Wayland, MA  01778

Anne G. Haney
61 Lincoln Road
Wayland, MA  01778
Lighthouse Capital Partners, L.P.
100 Drake's Landing, Suite 260
Greenbrae, CA  94904-3121

                              Exhibit E-2 - Pg. 12.
<PAGE>

Mark Holthouse
163 Upland Road
Newtonville, MA  02160

Stephen Smith
5404 Spangler Avenue
Bethesda, MD 20816

Sol Lerner
10 Flintlock Road
Sharon, MA  02067

Henry Lerner
One Celler Road
Edison, NJ

Leonard Epstein
193 Cheswick Road
Brighton, MA  02135

Bella Lerner
One Celler Road
Edison, NJ

Miriam Epstein
193 Chiswick Road
Brighton, MA  02135

Brian S. Eberman
10 LaFayette Road
Newton,  MA 02162

Lee Capital Holdings, LLC
One International Place
Boston, MA  02110
Attn: Jonathan Lee

Citizens Capital Incorporated
28 State Street, 15th Floor
Boston, MA  02109
Attn: Robert Garrow

Joseph Murphy
40 Maynard Farm Road
Sudbury, MA  01776

Intervoice-Brite, Inc.
17811 Waterview Parkway
Dallas, TX  75252

                              Exhibit E-1 - Pg. 13.
<PAGE>

                                   EXHIBIT F1

                           SPECIFIED AT&T COMPETITORS

[     ]

[     ]

[     ]

[     ]

[     ]

[     ]

[     ]

[     ]

                              Exhibit F-1 - Pg. 1.
<PAGE>

                                   EXHIBIT F2

                       SPECIFIED SPEECHWORKS COMPETITORS

Lernout & Hauspie

Nuance

Philips Electronics

IBM

Lucent Speech Services Division of Lucent Technologies (excluding without
limitation

Conversant and another hardware business division of Lucent Technologies)

Microsoft Corporation

Phonetic Systems

                              Exhibit F-2 - Pg. 1.
<PAGE>

                                   EXHIBIT G

                                 Marketing Plan

                                                 AT&T Proprietary & Confidential
                                                 -------------------------------

                               AT&T Speech Funnel
                               ------------------
                              DATED:  MAY 12, 2000
                              --------------------

SUMMARY:  This document represents AT&T Labs analysis to date of the projects
within AT&T (and in some cases with AT&T customers) that may require Speech-
enabled services over the next 1-6 years.  This document is a work in progress,
and will be updated by SpeechWorks and the AT&T Labs personnel managing the
business interface with SpeechWorks from time to time.  Upon execution of the
Agreement, the SpeechWorks and AT&T representatives shall meet to discuss an
action plan for initiating contacts with the various business units and
customers, verifying the accuracy of the information contained herein, and
identify a short list of projects and next steps associated with those projects.
The action plan could include a "SpeechWorks Day" at AT&T where we invite
targeted  business units to a presentation by Labs and SpeechWorks and/or
individual meetings scheduled with the appropriate individuals in the business
units.

CONSUMER MARKET'S (CMD)

1)   HMIHY TRIAL WITH AT&T CUSTOMER SERVICE.  An application for AT&T Customer
     Service (ACS) to offer "HMIHY" [     ] ([     ]-[     ]% [     ]) [     ]
     based on customer response  (see 800-9GET-ATT).

2)   INNOVATION DEVELOPMENT CENTER (IDC)/ [     ].  The IDC has built a trial
     [    ] ([     ]), [     ]), [     ].  [     ].

3)   TOLL-FREE DIRECTORY SERVICE (1-800-555-1212).  [     ] a [     ] automated
     director service for [     ] ([     ]% [     ]).  FCC [     ]-- [     ].

4)   00 INFO/00 MINUS.  Use Speech to automate part or all of each directory
     assistance.  [     ]: (i) [     ], [     ], (ii) [     ], [     ]

5)   ONECOMM.  AT&T has a [     ].

6)   CALLING CARD SERVICES.  There are several services: (i) basic calling card,
     (ii) prepaid, (iii) 0+ calling.  card.  [     ]

7)   AT&T ANYWHO.  AT&T online directory (www.anywho.com), could benefit from
     [    ].

8)   CMD OPERATOR SERVICES.  [     ].  [     ].

WIRELESS

9)   AT&T WIRELESS.  AWS has [     ] initiatives: (i) [     ], (ii) [     ],
     (iii) [     ], [     ], and (iv) [     ].  AWS currently has [     ]
     subscribers using speech enabled services, [     ] ([     ]) [     ].
     [     ]. [     ] [    ]-[     ]% [     ]. [     ]. A driving factor in
     the rush to get recognition in to the platform is the prospect of
     legislation limiting mobile phone usage while driving.  Current projects
     include:

                              Exhibit G - Pg. 1.
<PAGE>

 .    OmniSky: OmniSky/Palm V-- CDPD Model allows for wireless data
     connectivity; [     ]; [     ], [     ], [     ]; [     ]

     .    Microsoft/BT: Announced in March a collaboration on wireless data
          software  [    ] ([     ]); [     ] ([     ]).

     .    NextGen [     ] Apps done by [     ]--[     ], [     ]

     .    [     ] Messaging [     ]: Internal trial of [     ].

     .    Directories:  Wireless has a relationship with [     ]; this is an
          opportunity for [     ]

INFOWORXS.  AT&T Call Center Services division, [     ]

10)  BMP. BMD's BMP to use ASR on InfoWorks to [     ]. Current plan is to
     use [     ]. [     ] there are talks underway to deploy [     ].

     Est. ports:   [     ] total opportunity
     Contacts:     [     ] ([     ]);  [     ]; [     ]
     Funding:      Funded through [     ] is [     ] $[     ];
     Platforms:    [     ], [     ]; date, [     ] number [     ] ([     ]);
                   App needs [     ]; [     ] is done with [     ]
     Status:       [     ] customers [     ], [     ], [     ], [     ],
                   [     ], [     ], etc.
     Partner Role: Need to position Partner [     ]
     Next Steps:   Explore funding [     ]

11)  VOICE DIALING WITH POST.  [     ] a speech driven application offering
     voice dialing [     ].

12)  ESCAPE PROJECT.  [     ] customers [     ]

NETWORK SERVICES

13)  NETWORK IPE PROJECT.  [     ] is currently taking bids for platform upgrade
     options to [     ]; looking for a deployment to [     ];  [     ] will be
     most economical Vendor for [     ].  However deployment of more complicated
     applications will require the use of an external box hanging off  LINKS.
     [     ]: (i) [     ], (ii) [     ], [     ] ([     ]), [     ].  [     ].

BUSINESS MARKETS (BMD)

14)  NETWORK BMD CALL PROMPTER.   AT&T 800 service currently uses [     ]
     channels of speech recognition for [     ].   Phase 1 is adding [     ]
     opens a new revenue stream and greater customer capabilities for [     ]
     or [     ].

15)  HMIHY TRIAL WITH PRUDENTIAL.   AT&T Labs is preparing a trial to use speech
     recognition [     ] to offer AT&T's "How May I Help You" service to
     [     ].

16)  BNSVC "HMIHY. .  Several [     ] customers have expressed interest in
     HMIHY.  Following [     ] could support getting their customers these new
     apps

          .    [     ] ([     ]) and [     ]
          .    [     ]
          .    [     ]
          .    [     ]
          .    [     ] ([     ])
          .    [     ]
          .    [     ]

                              Exhibit G - Pg. 2.
<PAGE>

          .    [     ] ([     ])
          .    [     ]
          .    [     ]
               .    [     ] ([     ]) - [     ]
               .    [     ]
               .    [     ]
               .    [     ]

17)  AT&T SOLUTIONS.  Solutions has been working with several customer to offer
     [     ].  Customer list is similar to above.

18)  AT&T GLOBAL SOLUTIONS.  Solutions looking to launch a [     ] project; is
     working with an outside company [     ] to come up with an [     ]

19)  [   ] "HOW MAY I HELP YOU" APPLICATION. [     ] goal is to evolve to a
     "World Class Customer Service Organization". They want to provide service
     to [ ]. In 2000, they will receive approximately 98 million calls on their
     customer facing toll-free numbers. The Level of Service (percentage of
     calls answered to demand) is [ ]%. The [ ] is due, in part, to [ ].
     Currently, they have [ ] ([ ]) instead of [ ]. A [ ] ([ ]) greets [ ]
     dialing one of several 800 numbers. Callers are routed through [ ] ([ ]) to
     a [ ] or a [ ] ([ ]) - [ ]. If the caller does not respond to [ ] ([ ] or [
     ]), they are sent to a [ ]. [ ]. If these callers could be handled [ ], [
     ]. In addition, [ ]. This results in a [ ]. Implementing the How May I Help
     You (HMIHY) service will [ ].

20)  [     ]"HOW MAY I HELP YOU" APPLICATION. [     ] has two very large [     ]
     ([     ] and [     ]) which provide [     ] customers the opportunity to
     order a [     ] and/or [     ].  These applications also allow [     ]
     customers to track [     ]. There are many other AT&T - [     ]
     Applications which would benefit in a similar fashion as the ones listed
     above, these include the [     ] - [     ] ([     ]) and [     ]
     ([     ]).  AT&T also recently [     ] ([     ]) which allows [     ]
     customers to order and [     ].  By providing this type of technology
     [     ] which supports a [     ], we are adding great value to a [    ]
     and thus opening the door for a multitude of [     ].

21)  [     ] HOW MAY I HELP YOU APPLICATION. [     ] uses a [     ] ([     ])
     for access to the [     ].   There are [     ] nationwide that [     ].
     Callers are currently [     ].  Approximately [     ]% of the calls are
     directed to [    ]. [     ] would like to offer additional automated
     services, but the current [    ] is very lengthy and complex and believe
     the [     ].

AT&T LABS

22)  PHONEMAIL.  Labs project that allows [     ].

23)  PHONEWEB.  AT&T Labs has developed an architecture known as Phone Web which
     permits customers to build "[     ]" ([     ]) [     ].  The Phone Web
     [     ], when combined with [     ] and [     ] that [     ].

AT&T WORLNET

24)  WORLDNET VOICEMAIL.   AT&T is working with WorldNet to offer a service
     allowing caller to [     ] and [     ].

25)  WORLDNET CUSTOMER CARE.

                              Exhibit G - Pg. 3.
<PAGE>

AT&T BROADBAND SERVICES (ABS)
[     ]

OTHERS

26)  [     ].

27)  NET2PHONE.  AT&T-led consortium ([     ]) owns 39 percent voting stake in
     Net2Phone.  Rumor has it Net2Phone is working with SpeechWorks.  WorldNet
     has announced a promotion with Net2Phone [     ].

28)  INTERACTIVE TELESIS .  Specializes in voice response (IVR) services and
     deployment of speech recognition technologies.  They announced a
     partnership with SWI on 4/17/00.  Target customers include: [     ]

29)  EXCALIBUR The combination of AT&T's Digital Video Library (DVL) and
     Excalibur Screening Room(TM) enables users to search, browse and
     selectively retrieve video content online.. AT&T Labs will incorporate
     its industry-leading image and audio processing, along with its [     ],
     into Excalibur's Screening Room. As part of the agreement, the resulting
     new product will be available from Excalibur and AT&T as a completely
     outsourced solution for video asset management.

                              Exhibit G - Pg. 4.
<PAGE>

                                   EXHIBIT H

                            Support and License Fees

Definitions:  For purposes of this Exhibit H, the following  terms shall have
the following meaning:

"ASSESSABLE THIRD PARTY LICENSING FEES" means the amount of any per unit license
fees paid by SpeechWorks for third party software licensed by SpeechWorks and
embedded in or distributed with an applicable product.  Assessable Third Party
Licensing Fees excludes third party fees that are assessed as a percentage of
revenues

I.   License fees for SpeechWorks Integrated Speech Products that include:
(i) Deployments using Dialog Management/Natural Language Understanding
(e.g., "How may I help you?") Technology, (ii) Large Vocabulary Recognition
(i.e., greater than 100,000 words) deployments using AT&T Speech Technology,
and/or (iii) Speaker Identification or Speaker Verification deployments using
AT&T Speech Technology, in each case shall be the least of:

(a)  [     ]% of the[     ] price offered by SpeechWorks for any deployment of
     such product, plus Assessable Third Party Licensing Fees for such product,
     if any; and
(b)
(c)  the [     ] price offered by SpeechWorks for any deployment of such
     product; and
(d)
(c)  $[     ]/ [     ] for the 1st through the [     ] [     ]

     $[     ]/ [     ] for the [     ] through the [     ] [     ]

     $[     ]/ [     ] for the [     ] through the [     ] [     ]

     $[     ]/ [     ] after the [     ] [      ].

The number of [     ] shall be considered cumulatively for all AT&T Business
Units for each specific type of deployment described in (i) - (iii) above. For
example, all "How may I help you?" deployments by [ ] shall be considered in the
aggregate for the above chart; however, [ ] deployed for different applications,
e.g., Large Vocabulary deployments, shall NOT be aggregated with other type of
deployments. Further, each of the following shall apply to this Section I:

(i)  the foregoing aggregation shall reset on [     ] and on each [     ]
     anniversary thereof thereafter prior to the expiration of the initial five
     year term of the Agreement, provided that this reset shall not apply (i) if
     AT&T has made at least $[     ] dollars in payments for SpeechWorks Speech
     Software (including license fees, maintenance and professional services and
     other similar fees) in the previous [     ] period or  (ii) with respect to
     further deployments by the same [     ] of the [same application] (i.e.,
     each [     ] shall receive the benefit of the [     ] schedule for all
     [    ] deployments of the [     ]);

(ii) each purchase of [      ] shall be in a minimum amount equal to [     ]
     [      ] (i.e., this does not mean that a Business Unit must deploy at
     least [     ] [     ], only that for deployments less than [     ] [     ]
     each Business Unit must pay license fees for at least [     ] [     ] as
     per the above schedule); and

                              Exhibit H - Pg. 1.
<PAGE>

(iii) in the event that any deployment uses more than one of the applications
      described in (i) through (iii) above, AT&T shall pay the applicable
      [     ] fees for each application.

II.  License fees for all other SpeechWorks Integrated Speech Products (other
than SpeechWorks Integrated Speech Products that include either (i) any of the
applications described in Section I above or (ii) "TTS" functionality) shall be
the least of:

(i)   [     ]% of the [     ] price offered by SpeechWorks for any deployment of
      such product, plus Assessable Third Party Licensing Fees for such product,
      if any; and

(ii)  the [     ] price offered by SpeechWorks for any deployment of such
      product; and

(iii) [     ]% off of the amount computed after applying the discount schedule
      set forth below to SpeechWorks' standard license fees as of the Effective
      Date (SpeechWorks may amend its standard price list from time to time in
      the ordinary course of SpeechWorks' business, but shall not increase
      prices in the such list for AT&T deployments for at least [    ] from
      the Effective Date) for the applicable SpeechWorks Speech Software, or,
      expressed as formula: [     ] [    ]

      where S is  SpeechWorks standard license fees as of the Effective Date
      as follows:

      - SpeechWorks Base ((Lesser than)[     ]):      $[  ]/ [  ]

      - SpeechWorks Extended ((Lesser than)[    ]):   $[  ]/ [  ]

      - SpeechWorks Pro ((Greater than)[     ]):      $[  ]/ [  ]

      Discount is the discount computed in accordance with the following
      schedule:

Cumulative Purchase Total  Discount (for cumulative purchases up to this level)

Less than (Lesser than)$[     ]                     [     ]%
$[     ] to $[     ]                                [     ]%
$[     ] to $[     ]                                [     ]%
$[     ]                                            [     ]%
$[     ] to $[     ]                                [     ]%
$[     ] to $[     ]                                [     ]%
$[     ] to $[     ]                                [     ]%
$[     ] to $[     ]                                [     ]%
$[     ] to $[     ]                                [     ]%
(Greater than)$[     ]                              [     ]%

                              Exhibit H - Pg. 2.
<PAGE>

Cumulative purchase total dollar amounts for this Section II shall be computed
in the aggregate for all payments (including license fees, maintenance, but
excluding professional services) by AT&T Business Units to SpeechWorks during
the term of this Agreement, provided that the above discount schedule shall be
reset on [     ] and [     ] on each [     ] date thereof during the initial 5
year term of the Agreement.

III.  LICENSE FEES FOR TTS FUNCTIONALITY IN ANY SPEECHWORKS  INTEGRATED SPEECH
PRODUCT shall be the lesser of:

(a) $[   ]/ [    ] until the [   ] following the Effective Date and $[   ]/[   ]
    thereafter, and

(b)  [   ]% off of SpeechWorks [   ] pricing for [   ] paid by [   ] entity.

For purposes of this Section III., [   ] shall be defined as a [   ]; the
number of ports shall be based on the [   ]. Cumulative purchases of [   ]
during the term of this Agreement

IV.  SUPPORT FEES for SpeechWorks Integrated Speech Products licensed to AT&T
Business Units shall be the lesser of:

(a)  [     ] by a [     ], and

(b)  Standard (M-F, business hours)    [   ]% of net license fees (i.e. after
     applying all discounts, including AT&T discounts)

     Around the Clock [     ]% of net license fees (i.e. after applying all
     discounts, including AT&T discounts)

where "[     ]" means: license fees [     ], by the applicable AT&T Business
Unit for the SpeechWorks Speech Software for which the Support Services are
provided.

V.  PROFESSIONAL SERVICES FEES are as follows:              Per Diem rates

Project Management                                           $ 2,500

Application Consulting                                       $ 2,000

Speech Scientist                                             $ 2,000

Speech User Interface Design                                 $ 1,500

Application Development                                      $ 1,500

Systems Integration                                          $ 1,500

Operations Support                                           $ 1,000

Installation Services                                        $ 1,000

                              Exhibit H - Pg. 3.
<PAGE>

The foregoing professional services fees shall be fixed for the [     ] period
following the Effective Date, ending on [     ], and then shall be equal to
SpeechWorks' then-current fees.

Support Services on Professional Services              cost per year

- Standard (M-F, business hour)                        [     ]% of Application
                                                       Development Fee

- Around the Clock                                     [     ]% of Application
                                                       Development Fee

Note:  When a particular order traverses a level (either a threshold on number
of [    ] or a Payments threshold) on a schedule in this Exhibit H, the per [  ]
pricing shall be prorated so that one order may have different port pricing. All
discounts expire upon the expiration of the initial five-year term of the
Agreement.

                              Exhibit H - Pg. 4.
<PAGE>

                                   EXHIBIT I

                         Minimum End User License Terms

                           Software License Agreement

THIS SOFTWARE LICENSE AGREEMENT, dated as of ________________, 2000 (the
"Effective Date"), is by and between SPEECHWORKS INTERNATIONAL, INC., a Delaware
corporation ("SWI"), with offices at 695 Atlantic Ave., Boston, MA 02111; and
_____________________, a _________________ corporation ("Licensee"), with
offices at ____________________, ________  __ _____.

                                  INTRODUCTION

A.   SWI is the developer and owner of certain speech recognition technology and
     certain related software for automating telephone-based, network-based and
     internet-based transactions.

B.   SWI has agreed to grant to the Licensee and the Licensee has agreed to
     accept from SWI a License (as hereafter defined) to use such software upon
     the terms and conditions set forth below.

     For and in consideration of, and conditioned on, the covenants stated
herein, and for other good and valuable consideration, the receipt and
sufficiency of which the parties hereby acknowledge, the parties hereby agree as
follows:

                               TERMS OF AGREEMENT

SECTION 1   -- DEFINITIONS

     1.1  Defined Terms.  In addition to the terms defined above and elsewhere
in this Agreement, the following terms as used in this Agreement shall have the
meanings set forth below:

          "Agreement" shall mean this Agreement, all attached exhibits, and any
          other documents made a part of hereof or incorporated by reference
          herein, including any written amendments hereto.

          "SWI Software" shall mean, collectively or individually, the software
          programs described in Exhibit I-1 attached hereto, in object code
          format, and including all corrections, modifications, enhancements and
          upgrades to such software which may be provided to Licensee by SWI
          hereunder pursuant to the terms of this Agreement or any separate
          license and/or support agreement entered into by the parties hereto.

          "Documentation" shall mean the operating manuals, including a
          description of the functions performed by the SWI Software, user
          instructions, technical literature and all other related materials in
          the English language, in both eye-readable and machine-readable,
          printable form, which may, from time to time, be supplied to Licensee
          by SWI to facilitate the use and application of the SWI Software.

          "License"  shall mean the license in the SWI Software granted in
          Section 2.1 of this Agreement.

                              Exhibit I - Pg. 1.
<PAGE>

SECTION 2 -- GRANT OF RIGHTS

     2.1  Software License. Subject to the terms, conditions and restrictions
set forth in this Agreement, SWI hereby grants, and Licensee hereby accepts, a
non-exclusive, non-transferable, right and license to use the SWI Software.

     2.2  Documentation License. Subject to the terms, conditions and
restrictions set forth in this Agreement, SWI hereby grants, and Licensee
accepts, a non-exclusive license, to use the Documentation, and to copy the
Documentation only for use by its employees or consultants.

     2.3  Term. The License granted to Licensee herein, and the other rights and
obligations of the parties under this Agreement, shall commence on the Effective
Date, and shall continue indefinitely unless terminated under the provisions of
Section 7 ("Termination") of this Agreement.

     2.4  Copies. Licensee may make a reasonable number of copies of the SWI
Software for Licensee's internal back-up and archival purposes only, provided
that all such copies shall bear the original and unmodified copyright, patent
and other intellectual property markings as originally delivered by SWI.

     2.5  Restrictions; Acknowledgement of Proprietary Rights. Licensee
acknowledges that SWI retains all right, title and interest in and to the
original, and any copies, of the SWI Software and Documentation, and ownership
of all patent, copyright, trade secret, trademarks and other intellectual
property rights pertaining thereto, shall be and remain the sole property of
SWI.  Licensee shall not be an owner of any copies of, or have any interest in,
the SWI Software or Documentation, but rather, is licensed, pursuant to and
subject to the limitations in this Agreement, to use such copies. Without
limiting the generality of the foregoing, Licensee receives no rights and agrees
that it will not itself, or through any parent, subsidiary, affiliate, agent or
other third party: (a) modify, port, translate, localize, or create derivative
works of the SWI Software or upon any Confidential Information of SWI; (b)
decompile, disassemble, reverse engineer or attempt to reconstruct, identify or
discover any source code, underlying ideas, underlying user interface techniques
or algorithms of the SWI Software by any means whatsoever, or disclose any of
the foregoing; (c) sell, lease, license, sublicense, copy, market or distribute
the SWI Software; (d) encumber or suffer to exist any lien or security interest
on any SWI Software; (e) knowingly take any action that would cause any SWI
Software to be placed in the public domain; and (f) use the SWI Software in any
computer environment not specified in Exhibit I-1.

     2.6  Trademarks. Licensee acknowledges that SWI owns, and shall continue to
own, all right, title and interest in the trademarks "DialogModules",
"SpeechSite", "SpeechPortal", "SpeechWorks", "SpeechWorks Here", SWI's logos and
the percolation noise that is part of the SWI Software and Licensee agrees that
it will do nothing inconsistent with such ownership.

     2.7  Additional Terms and Conditions. The licenses and other rights granted
pursuant to this Agreement shall be subject to the additional terms and
conditions set forth in the Exhibits hereto.

SECTION 3-- CONSIDERATION; LICENSE SUPPORT AND MAINTENANCE

     3.1  License Fee. In consideration of the License granted in Section 2
("Grant of Rights"), Licensee hereby agrees to pay to SWI the license fees, in
the amounts and at the times specified in Exhibit I-1.

                              Exhibit I - Pg. 2.
<PAGE>

     3.2  Taxes. Licensee shall pay or reimburse all federal, state and local
taxes (exclusive of taxes on SWI's net income) and assessments arising on or
measured by amounts payable to SWI under this Agreement, or furnish SWI with
evidence acceptable to the taxing authority to sustain an exemption therefrom.

     3.3  License Support and Maintenance; Fees. Support and maintenance
services shall be provided in accordance with the terms and conditions set forth
in  Exhibit I-2 hereto.

SECTION 4 -- CONFIDENTIAL INFORMATION

     4.1  Confidential Information. A party may from time to time disclose (the
"Disclosing Party") to the other party (the "Receiving Party") certain
Confidential Information (as hereinafter defined) of the Disclosing Party.
Except as expressly permitted by this Agreement, for a period of five (5) years
from the termination of this Agreement,  the Receiving Party shall protect the
Confidential Information of the Disclosing Party from unauthorized
dissemination, using the same degree of care which the Receiving Party
ordinarily uses with respect to its own proprietary information, but in no event
with less than reasonable care.  The Receiving Party shall not use the
Confidential Information of the Disclosing Party for any purpose not expressly
permitted by this Agreement, and shall limit the disclosure of the Confidential
Information of the Disclosing Party to the employees or agents of the Receiving
Party who have a need to know such Confidential Information for purposes of this
Agreement, and who are, with respect to the Confidential Information of the
Disclosing Party, bound in writing by confidentiality terms no less restrictive
than those contained herein.  The Receiving Party shall provide copies of such
written agreements to the Disclosing Party upon request; provided, however, that
such agreement copies shall themselves be deemed the Confidential Information of
the Receiving Party.  Notwithstanding the foregoing, Confidential Information
may be disclosed if such disclosure is required by law or by the order or a
court or similar judicial or administrative body; provided, however, that the
Receiving Party shall notify the Disclosing Party of such requirement
immediately and in writing, and shall cooperate reasonably with the Disclosing
Party, at the Disclosing Party's expense, in the obtaining of a protective or
similar order with respect thereto.

     4.2  Definition of Confidential Information.  For purposes of this
Agreement, the term "Confidential Information" shall mean (a) the SWI Software,
in object and source code form, and any related technology, idea, algorithm or
information contained therein, including without limitation any trade secrets
related to any of the foregoing; (b) a party's product plans, designs, costs,
prices and names; non-published financial information, marketing plans, business
opportunities, personnel, research, development or know-how; (c) any information
designated by the Disclosing party as confidential in writing or, if disclosed
orally, designated as confidential at the time of disclosure and reduced to
writing and designated as confidential in writing within thirty (30) days; and
(d) the terms and conditions of this Agreement; provided, however that
"Confidential Information" will not include information that: (i) is or becomes
generally known or available by publication, commercial use or otherwise through
no fault of the receiving party; (ii) is known and has been reduced to tangible
form by the receiving party at the time of disclosure and is not subject to
restriction; (iii) is independently developed by the receiving party without use
of the disclosing party's Confidential Information; (iv) is lawfully obtained
from a third party who has the right to make such disclosure; or (v) is released
for publication by the disclosing party in writing.

     4.3  Return of Confidential Information. The Receiving Party shall return
to the Disclosing Party, destroy or erase all Confidential Information of the
Disclosing Party in tangible form: (a) upon the written request of the
Disclosing Party; or (b) upon the expiration or termination of this Agreement,
whichever comes first, and in both cases, the Receiving Party shall certify
promptly and in writing that it has done so.

                              Exhibit I - Pg. 3.
<PAGE>

SECTION 5   -- LIMITED WARRANTY AND DISCLAIMER

     5.1  Warranty of Authority.  SWI represents and warrants that it has the
right and authority to grant to Licensee the rights and licenses set forth
herein.

     5.2  Limited Warranty. Subject to the limitations and exceptions set forth
in this Section 5.2 and in Section 6.3 ("Limitation of Liability; Licensee
Indemnity"), SWI warrants for a period of thirty (30) days from the Effective
Date that the SWI Software, and if properly installed by Licensee in accordance
with SWI's published instructions, will substantially conform to the
specifications in the Documentation and that the media on which the software is
delivered will be free of defects.  In the event of nonconformity of the SWI
Software to such specification, Licensee shall promptly notify SWI and provide
SWI with all available information in written or electronic form so that SWI can
reproduce any such nonconformity.  SWI's sole obligation is to undertake
reasonable commercial efforts to correct a nonconformity so reported to SWI
during the warranty period.  SWI's SOLE LIABILITY AND LICENSEE'S EXCLUSIVE
REMEDY WITH RESPECT TO BREACH OF THE FOREGOING LIMITED WARRANTY WILL BE LIMITED
TO ERROR CORRECTION OR PRODUCT REPLACEMENT, OR IF NEITHER IS IN SWI'S OPINION IS
COMMERCIALLY FEASIBLE, REFUND OF THE LICENSE FEE RECEIVED BY SWI FROM LICENSEE.

     5.3   DISCLAIMER.  THE FORGOING PROVISIONS OF THIS SECTION 5 STATE SWI'S
SOLE AND EXCLUSIVE WARRANTY AND SOLE AND EXCLUSIVE OBLIGATION TO LICENSEE FOR
BREACH OF WARRANTY. EXCEPT FOR THE EXPRESS WARRANTIES STATED IN THIS SECTION 5,
SWI MAKES NO ADDITIONAL WARRANTY, EXPRESS OF IMPLIED, STATUTORY OR OTHERWISE, AS
TO ANY MATTER WHATSOEVER AND ALL WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS ARE EXPRESSLY
EXCLUDED.

SECTION 6  - INFRINGEMENT MATTERS; INDEMNITIES

     6.1  Indemnity.  SWI agrees, at its own expense, to defend or, at its
option, to settle, any claim or action brought against Licensee to the extent it
is based on a claim that Licensee's use of the SWI Software in accordance with
the scope of this Agreement infringes or violates any United States patent,
United States copyright, trademark, or trade secret of a third party, and will
indemnify and hold Licensee harmless from and against any damages, costs and
fees reasonably incurred (including reasonable attorneys' fees) that are
attributable to such claim or action and which are assessed against Licensee in
a final judgment.  Licensee agrees that SWI shall have the foregoing obligation
only if Licensee provides SWI with: (a) prompt written notification of the claim
or action; (b) sole control and authority over the defense or settlement
thereof; and (c) all available information, assistance and authority to settle
and/or defend any such claim or action.

     6.2  Limited Remedies.  If any SWI Software becomes, or in the opinion of
SWI is likely to become, the subject of an infringement claim or action, SWI may
at its sole option: (a) procure, at no cost to Licensee, the right to continue
using the SWI Software; (b) replace or modify the SWI Software to render it
noninfringing, provided there is no material loss of functionality; or (c) if,
in SWI's reasonable opinion, neither (a) nor (b) above are commercially
feasible, terminate the license and refund the amounts Licensee paid for such
SWI Software as depreciated on a straight-line sixty (60) month basis.  Except
as provided in Section 6.1 ("Indemnity"), the foregoing provisions of this
Section 6.2 state SWI's sole obligation and Licensee's exclusive remedy in the
event any such claim or action is commenced or is likely to be commenced.

                              Exhibit I - Pg. 4.
<PAGE>

     6.3  Limitation of Liability; Licensee Indemnity.  SWI will have no
liability under this Section 6 or the limited warranty provided for in Section
5.2 ("Limited Warranty") for any claim or action where: (a) such claim or action
would have been avoided but for modifications of the SWI Software, or portions
thereof, made after delivery to Licensee; (b) such claim or action would have
been avoided but for the combination or use of the SWI Software, or portions
thereof, with other products, processes or materials; (c) Licensee continues
allegedly infringing activities after being notified thereof or after being
informed of modifications that would have avoided the alleged infringement; or
(d) Licensee's use of the SWI Software is not strictly in accordance with the
terms of this Agreement. Licensee agrees to indemnify and hold SWI harmless from
and against all losses, damages and expenses, including reasonable attorney's
fees, in connection with any claims brought against SWI and its officers,
employees, agents or subcontractors arising as a result of any of the conditions
described in clauses (a) through (d) above.  SWI agrees that Licensee shall be
released from the foregoing obligation unless SWI provides Licensee with: (i)
prompt written notification of the claim or action; (ii) sole control and
authority over the defense or settlement thereof; and (iii) all available
information, assistance and authority to settle and/or defend any such claim or
action.

     6.4  LIMITATION OF LIABILITY. SWI's total liability to Licensee and its
officers, customers and employees for any claim arising under this Agreement, or
otherwise arising from the transactions contemplated under this Agreement,
regardless of the form of action (including, but not limited to actions for
breach of contract, negligence, strict liability, rescission and breach of
warranty) will not exceed the lesser of (a) the aggregate fees actually paid to
SWI during the one (1) year period preceding such claim of damages, or (b) the
actual damages sustained by Licensee.

     6.5  NO CONSEQUENTIAL DAMAGES. IN NO EVENT SHALL SWI BE LIABLE FOR ANY
SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOSS
OF REVENUES AND LOSS OF PROFITS, EVEN IF SWI HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.

SECTION 7  -- TERMINATION

     7.1  Termination By Either Party. Either party may terminate this Agreement
immediately upon giving notice in writing to the other party if such other party
commits a material breach of this Agreement and shall have failed to cure such
breach within thirty (30) days of receipt of a request in writing from the
notifying party to do so; provided, however, that a breach by SWI of its
obligations under Section 5 shall not be deemed to be a material breach but
instead shall be subject to the exclusive remedies set forth in Section 6.2
("Limited Remedies").

     7.2  Termination by SWI. SWI may terminate this Agreement immediately upon
giving notice in writing to Licensee in the following circumstances (a) If
Licensee fails to pay any sums due to SWI pursuant to the terms of this
Agreement, or any other agreement between the parties, within thirty (30) days
of the due date, whether or not demanded by SWI; (b) If Licensee infringes SWI's
intellectual property or commits, or permits any third party to commit, any
breach of confidentiality obligations owed to SWI; or (c) If Licensee files or
has filed against it a petition in bankruptcy,  has a receiver appointed to
handle its assets or affairs or admits that it is insolvent or is otherwise
unable to pay its debts as they mature.

                              Exhibit I - Pg. 5.
<PAGE>

     7.3  Effect of Termination. Immediately upon the termination of this
Agreement (whether pursuant to this Section 7 or for any other reason): (a)
Licensee shall immediately cease use of the SWI Software (in any form, including
partial copies in its possession or under its control), and, within ten (10)
days of such termination, return all copies of the SWI Software to SWI, and
certify in writing to SWI that no copies have been retained by it; and (b) any
outstanding amounts due to SWI hereunder shall immediately become due and
payable.

     7.4  Survival.  Notwithstanding anything to the contrary in this Section 7,
the provisions of Sections 3, 4, 5, 6, 7, and 8 shall survive termination of
this Agreement.

SECTION 8   --  GENERAL TERMS

     8.1  Assignment.  Licensee shall not be entitled to assign or otherwise
transfer rights or obligations under this Agreement whether in whole or in part,
except with the prior written consent of SWI.

     8.2  Force Majeure.  Except for the obligation to make payments,
nonperformance of either party shall be excused to the extent that performance
is rendered impossible by strike, fire, flood, governmental acts or orders or
restrictions, failure of suppliers, or any other reason where failure to perform
is beyond the reasonable control of the nonperforming party.

     8.3  Notices.  Any required notices hereunder shall be given in writing at
the address of each party set forth above, or to such other in the manner
contemplated herein, and shall be deemed served when delivered or, if delivery
is not accomplished by reason or some fault of the addressee, when tendered.

     8.4  Relationship Between the Parties. In all matters relating to this
Agreement, Licensee and SWI shall act as independent contractors. Except as may
be otherwise expressly permitted hereunder, neither party will represent that it
has any authority to assume or create any obligation, expressed or implied, on
behalf of the other party, or to represent the other party as agent, employee,
or in any other capacity. Neither party shall have any obligation, expressed or
implied, except as expressly set forth herein.

     8.5  Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts without giving
effect to principles of conflicts of laws and Licensee hereby submits to the
exclusive jurisdiction of the federal and state courts situated in said
Commonwealth and the applicable service of process.

     8.6  Injunctive Relief. Licensee recognizes and acknowledges that any use
or disclosure of the SWI Software; Documentation or SWI's Confidential
Information by the Licensee in a manner inconsistent with the provisions of this
Agreement may cause SWI irreparable damage for which remedies other than
injunctive relief may be inadequate, and Licensee agrees that in any request by
SWI to a court of competent jurisdiction for injunctive or other equitable
relief seeking to restrain such use or disclosure, Licensee will not maintain
that such remedy is not appropriate under the circumstances. The parties further
agree that in the event such equitable relief is granted in the United States,
they will not object to courts in other jurisdictions granting provisional
remedies enforcing such United States judgments.

                              Exhibit I - Pg. 6.
<PAGE>

     8.7  Export Controls; Government Use.  Licensee agrees and certifies that
neither the SWI Software, nor any other technical data received from SWI, nor
the direct product thereof, will be exported or re-exported outside the United
States except as authorized and as permitted by the laws and regulations of the
United States. Any use of the SWI Software by the U.S. Government is conditioned
upon the Government agreeing that the SWI Software is subject to Restricted
Rights as provided under the provisions set forth in subdivision (c)(1)(ii) of
Clause 252.227-7013 of the Defense Federal Acquisition Regulations Supplement,
or the similar acquisition regulations of other applicable U.S. Government
organizations.

     8.8  Entire Agreement; Headings; Counterparts. This Agreement constitutes
the entire agreement and understanding between the parties with respect to the
subject matter hereof, and supersedes all prior agreements, arrangements and
undertakings between the parties. No addition to or modification of any
provision of this Agreement shall be binding upon the parties unless made by a
written instrument signed by a duly authorized representative of each of the
parties. The headings to the sections of this Agreement are for ease of
reference only and shall not affect the interpretation or construction of this
Agreement. This Agreement may be executed in counterparts, each of which shall
be deemed to be an original and all of which shall be deemed to be an original
instrument.

     8.9  Publicity. Licensee agrees to cooperate with SWI in order to develop
and distribute a mutually agreeable press release within fourteen (14) days of
the Effective Date.

     8.10  Partial Invalidity; Waiver. If any provision of this Agreement or the
application thereof to any party or circumstances shall be declared void,
illegal or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the extent permitted by applicable law. In such event the parties
shall use their best efforts to replace the invalid or unenforceable provision
by a provision that, to the extent permitted by applicable law, achieves the
purposes intended under the invalid or unenforceable provision. Any deviation by
either party from the terms and conditions with applicable laws, rules and
regulations shall not be considered a breach of this Agreement. No failure of
either party to exercise any power or right given either party hereunder or to
insist upon strict compliance by either party with its obligations hereunder,
and no custom or practice of the parties at variance with the terms hereof shall
constitute a waiver of either party's right to demand exact compliance with the
terms hereof.

     In Witness Whereof, the parties have caused this Agreement to be executed
by their respective duly authorized representative as an instrument under seal
effective as of the Effective Date.

      _______________________________      SPEECHWORKS INTERNATIONAL, INC.

     By:                               By:
         ----------------------------      ----------------------------------
     Name:                                 Name: Richard J. Westelman
          ---------------------------
     Title:                                Title: Chief Financial Officer
          ---------------------------

     ATTACHED EXHIBITS:
     Exhibit I-1 - SWI Software, Fees, etc.
     Exhibit I-2 -Maintenance and Support Terms

                              Exhibit I - Pg. 7.
<PAGE>

                                  EXHIBIT I-1

                            SWI Software; Fees; Etc.

SpeechWorks(R) Pro, Version 5.0 for WindowsNT/Dialogic Developer's Toolkit,
Serial Number SW______________
(see table below for description)

<TABLE>
<CAPTION>

                                                          Recognition    System     FEE/PORT      LICENSE
PRODUCT NAME             PRODUCT DESCRIPTION                 Ports        Seats      OR SEAT       FEES
                                                        ---------------------------------------------------
<S>             <C>                                          <C>           <C>        <C>          <C>

SpeechWorks     Includes:
[ -- ] Version  . SpeechWorks Recognition Engine                1           N/A        $_____       $_____
5.0 with        . DialogModules: [   ]
Dialog Module
Bundle [ -- ]
-----------------------------------------------------------------------------------------------------------
SpeechWorks     Includes:                                      N/A           1         $15,000      $15,000
Tools Version   . Vocabulary Editor (allows developers
5.0               to generate and maintain large
                  vocabulary lists)
                . Grammar Specification and Tuning Tools
                  (allows developers to build custom
                  applications and tune their performance)
-----------------------------------------------------------------------------------------------------------
                                                                      TOTAL LICENSE FEES:    $___________
</TABLE>

The term "recognition ports" shall mean the number telephone channels enabled
with the software included in SpeechWorks Dialog Module Bundle C that is capable
of either recognizing spoken words or performing "barge-in" for a discrete
period of time. SWI acknowledges that telephone lines or ports can be configured
with or without speech recognition dynamically, and as such, charges are based
on the maximum number of simultaneous speech recognizers currently configured in
the total system.  The term "system seats" shall mean the number of end-users
permitted to concurrently access and use, at the same time, the SpeechWorks
Tools and Grammar Libraries.

     PAYMENT SCHEDULE:

     All license fees to be paid by Licensee under this Exhibit I-1 shall be due
and payable prior to shipment of the software.

                             Exhibit I-1 - Pg. 1.
<PAGE>

                                  EXHIBIT I-2

                         Maintenance and Support Terms

     Pursuant to Section 3.3 of the Agreement, SWI shall provide to
___________________ ("Customer") the Maintenance and Support Services described
in this Exhibit.  In the event of a conflict of terms with respect to
Maintenance and Support Services between the Agreement and this Exhibit, the
terms of this Exhibit shall govern.

SECTION 1  -- DEFINITIONS

     1.1  Defined Terms.  Terms used and not otherwise defined in this Exhibit
shall have the meanings set forth in the Agreement.  In addition, the following
terms as used in this Exhibit shall have the meanings set forth below:

     "Covered Software" shall mean the SWI Software and any Custom Software for
     which SWI is obligated to provide Maintenance and Support Services.

     "Custom Software" shall mean the specific computer programs developed (or
     to be developed) by SWI and described on Annex 2 to this Exhibit.

     "Custom Software Documentation" means the written description of the
     functions performed by the Custom Software, user instructions, and
     technical literature supplied to Customer by SWI to facilitate the use and
     application of the Custom Software.

     "Effective Date" shall have the meaning set forth on Annex 1 hereto.

     "Error" shall mean any failure of the SWI Software to conform in all
     material respects to Documentation or, in the case of Customer Software,
     the failure to conform to the Custom Software Documentation; provided,
     however, any nonconformity resulting from (a) Customer's misuse, improper
     use, alteration, or damage of any Covered Software, (b) Customer's failure
     to implement all Updates issued to Customer; or (c) combining or merging
     any Covered Software with any hardware or software not supplied or
     identified as compatible by SWI, shall not be considered an Error.

     "Exhibit" shall mean this  Exhibit and Annex 1 and Annex 2 attached hereto,
     including any written amendments hereto or thereto.

     "Level 1 Error"  shall mean an Error that reduces by fifty percent (50%) or
     more the service, operation or transaction processing capabilities of the
     Covered Software.

     "Level 2 Error" shall mean an Error, other than a Level 1 Error, that
     reduces by ten percent (10%) or more the service, operation or transaction
     processing capabilities of the Covered Software.

     "Level 3 Error"  shall mean an Error that causes an operational problem
     with the Covered Software that is not a Level 2 or 3 Error.

                              Exhibit I-2 - Pg. 1.
<PAGE>

     "Level 4 Error" shall mean any other Error that is not a Level 1, 2 or 3
     Error including, without limitation, Documentation or administrative screen
     errors, such as typographical errors, screen format
     errors or syntax errors.

     "Maintenance and Support Services" shall mean the services described in
     Section 2 of this Exhibit subject to the exclusions set forth in Sections 4
     and 7 of this Exhibit.

     "Support Plan"  shall mean the maintenance option that Customer elects
     pursuant to Section 2.1 of this Exhibit.

     "Updates" means a release or version of the SWI Software containing
     functional enhancements, modifications, extensions, and/or Error
     corrections.  The content and timing of all Updates shall be decided upon
     by SWI in its sole discretion and will generally include changes that
     correct defects as well as upgrade the SWI Software to the most current
     release or version of the SWI Software then being generally marketed by
     SWI.

SECTION 2  - MAINTENANCE AND SUPPORT SERVICES

     2.1  Election of Support Option.  Customer hereby elects the Support Plan
designated on Annex 1 hereto for the initial twelve-month period following the
Effective Date.  Such designation shall remain in effect for each subsequent
twelve-month period that the provisions of this Exhibit are in effect (as
provided in Section 6), unless Customer delivers a purchase order to SWI
requesting a change in the Support Plan at least ninety (90) days prior to
beginning of the twelve-month period in which Customer desires such change to
take effect (or such shorter period as SWI may approve).  The Support Plan that
Customer selects shall apply to all Covered Software.

     2.2  Condition to SWI Obligations.  Unless Customer has paid all fees set
forth in Section 5 of this Exhibit in a timely manner, SWI shall have no
obligation to provide to Customer the Maintenance and Support Services
applicable under the Support Plan.

     2.3  Scope of Maintenance and Support Services.  (a) The Maintenance and
Support Services to be provided hereunder are intended only to correct Errors
(subject to service level provisions of Section 2.8) and to provide Updates to
the SWI Software.  This Exhibit does not provide for enhancements, Updates, or
new features or functionality for any Custom Software.

          (b) The Maintenance and Support Services may be purchased pursuant to
this Exhibit for the SWI Software, or the SWI Software and Custom Software, as
listed in Annex 1 to this Exhibit.  If Maintenance and Support Services are not
purchased for the Custom Software then the terms and conditions set forth herein
applicable to the Custom Software for which no Maintenance and Support Services
are purchased shall be inapplicable to Customer and this Exhibit shall be read
and construed as if such terms were not included.  Maintenance and Support
Services may not be purchased for Custom Software alone.

     2.4  Maintenance. SWI shall provide Customer with (a) Updates, if any, and
appropriate Documentation delivered electronically for installation by Customer
and (b) periodic software bulletins providing additional documentation and
provisional solutions to reported problems.

                              Exhibit I-2 - Pg. 2.
<PAGE>

     2.5  Telephone Support.  If Customer elects a Support Plan that includes
telephone support services, then SWI shall provide telephone assistance to
Customer with respect to the Covered Software in accordance with the response
and error correction time targets set forth in Annex 1 attached hereto, such
services to include (a) clarification of functions and features of the Covered
Software, (b) clarification of Documentation or Customer Software Documentation
pertaining to the Covered Software, (c) guidance in the operation of the Covered
Software, and (d) Error verification, analysis and code corrections, as
necessary, to cause the Covered Software to perform in accordance with the
specifications set forth in the most current Documentation or Custom Software
Documentation, as the case may be, as updated by SWI from time to time, to the
extent possible (except for code corrections) by telephone.

     2.6  Annual Account Review. SWI shall provide Customer with one (1) day of
free consulting at Customer's facility each year to review the status of the
Covered Software, assess Customer's ongoing and future use of the Covered
Software, solicit input from Customer on future development and direction of the
Covered Software, and to make recommendations regarding Customer's use of the
Covered Software.

     2.7  Classification of Errors. Upon identification of any Error, Customer
shall notify SWI of such  Error and provide SWI with enough information to
locate and/or replicate the Error.  SWI shall determine in its reasonable
judgment the classification of such Error as either a Level 1, 2, 3 or 4 Error,
provided, however, that if the Service Plan selected by Customer only provides
for correction of Errors in the next major release of SWI Software, then no such
classification shall be made.

     2.8  Service Level Objectives. SWI and Customer acknowledge the potentially
idiosyncratic nature of any Error in the Covered Software.  While the response
times and target resolution times set forth in Annex 1 to this Exhibit
constitute targeted goals of the Maintenance and Support Services, it is
understood that SWI shall use all reasonable commercial efforts to attempt to
resolve any problems within the target times specified in Annex 1 but that
failure to meet these targeted times shall not constitute a failure to perform a
material provision of this Exhibit.

     2.9  Place of Performance. The Maintenance and Support Services provided
hereunder shall be performed by remote access unless SWI determines that on-site
service at the Customer's site is required in which event Customer shall pay for
the associated travel and accommodation expenses.

     2.10  Customer Obligations. Customer shall:

     (a)  provide supervision, control and management of the use of the Covered
          Software.  In addition, Customer shall implement procedures for the
          protection of information and the implementation of backup procedures
          in the event of  Errors or malfunction of the Covered Software or
          equipment upon which the Covered Software is loaded or operating;

     (b)  during normal business hours, provide SWI with reasonable access
          either telephonically or on a remote basis to Customer's personnel and
          equipment upon which the Covered Software is loaded or operating. This
          access shall include, when applicable, the ability to dial-in to
          equipment on which the Covered Software is operating. SWI will inform
          Customer of the specifications of the modem equipment needed, and
          Customer will be responsible for the costs and use of said equipment
          at the Customer's location;

     (c)  document and promptly report all Errors or malfunctions of the Covered
          Software to SWI. Customer shall take all steps necessary to carry out
          procedures for the rectification of such Errors or malfunctions within
          a reasonable time after such procedures have been provided by SWI;

                              Exhibit I-2 - Pg. 3.
<PAGE>

     (d)  maintain a current backup copy of all programs and data; and

     (e)  properly train its personnel in the use and application of the Covered
          Software and the equipment on which the Covered Software is loaded or
          operating.

SWI is entitled to suspend Support Services under this Exhibit to the extent
that Customer's failure to comply with this Section 2.10 increases the cost or
difficulty of SWI providing such services.

     2.11 Additional Services. In the event Customer requests, and SWI, in its
sole discretion, agrees to provide, materials or services for the Covered
Software for problems encountered by Customer that are outside of the scope of
the Maintenance and Support Services or that Customer desires to have resolved
on a more expedited basis than Customer has contracted for under this Exhibit,
SWI shall invoice Customer for SWI's time, materials used and travel expenses
and any other reasonable expenses incurred by SWI in providing such materials
and service.  Customer shall pay SWI the full amount of any such invoice within
thirty (30) days after receipt and interest shall accrue at the lesser of the
highest lawful rate or one percent (1%) per month for any amounts not paid by
the date due.

SECTION 3 -- ADDITIONS

     The annual fees for Maintenance and Support Services shall be adjusted to
reflect any increases in Customer's license fee that are attributable to
Customer's licensing, from time to time, additional software from SWI.  Such
adjustment shall be equal to the applicable percentage of the full purchase
price of such additional software corresponding to the Support Plan selected by
Customer under the purchase order for such Maintenance and Support Services.
Additionally, notwithstanding anything herein to the contrary, the obligation of
SWI to continue to provide Maintenance and Support Services to Customer after
any such increase in the license fee shall be subject to payment of a fee equal
to the difference between the Annual Maintenance Fee before and after such
adjustment, prorated for the remaining term of the then current twelve (12)
month term of this Exhibit, as measured from the date of such change.

SECTION 4 -- EXCLUSIONS

     4.1  Prior Software Versions. Maintenance and Support Services are provided
with respect to versions of the SWI Software that, in accordance with SWI
policy, are then being supported by SWI and, in any event, SWI shall only be
obligated to support the then current production version of the SWI Software and
to support the immediately prior release for a period of six (6) months after
the release of the then current production version.

     4.2  Operating Environment. Insofar as the use of a certain release of the
SWI Software requires the use of a particular release of system software (such
as operating system, firmware or utilities) on the equipment specified in the
Agreement, Customer shall be responsible for ensuring that the latter is used.
Otherwise, SWI is entitled to suspend all Support Services under this Exhibit
until the necessary system software is installed.  Customer's obligation to pay
any fees and charges hereunder up to the expiration of this Exhibit shall in no
way be affected by such suspension.

                              Exhibit I-2 - Pg. 4.
<PAGE>

SECTION 5  - CONSIDERATION

     5.1  Fees.  Customer shall be invoiced by SWI at the beginning of each
          twelve-month period for which this Exhibit is in effect, the
          applicable annual fee for the Support Plan.

     5.2  Time of Payment. Except as otherwise provided in this Exhibit all
          amounts due SWI shall be paid within thirty (30) days of Customer's
          receipt of invoice from SWI.

SECTION 6  - TERM AND TERMINATION

     6.1  Term.  The provisions of this Exhibit shall become effective on the
Effective Date, shall remain in effect for an initial term of twelve (12)
months, and shall thereafter automatically be renewed for successive twelve (12)
month terms, unless either party gives the other notice at least ninety (90)
days prior to the expiration of a twelve (12) month term that such renewal shall
not occur, in which event the provisions of this Agreement shall expire at the
end of such term, except as otherwise provided in this Exhibit.  In no event,
however, shall any obligation of SWI to provide Maintenance and Support Services
extend beyond the termination or expiration of the Agreement or commence prior
to the execution of the Agreement, unless otherwise agreed by the parties.

     6.2  Termination. The obligations of SWI and Customer under this Exhibit
(a) shall terminate immediately upon the termination of the Agreement or (b) may
be terminated by either party immediately upon giving written notice to the
other party if such other party commits a material breach of this Exhibit and
shall have failed to cure such breach within thirty (30) days of receipt of a
request in writing from the notifying party to do so; provided, however, that
upon any termination under this Section 6.2 or otherwise, all earned and unpaid
fees and other charges payable under this Exhibit shall become immediately due
and payable.

     6.3    Survival of License. Termination of Maintenance and Support Services
upon failure to renew will not affect the license of the SWI Software.

SECTION 7 -- OWNERSHIP AND WARRANTY DISCLAIMER

     7.1  Title.  All Updates and other changes, improvements, bug fixes or
other modifications to the SWI Software provided under this Exhibit shall be
deemed to be included within the SWI Software and will be subject to the terms
and conditions of the agreement pursuant to which such software was licensed.

     7.2  Limited Warranty of Performance and Exclusive Remedy  SWI warrants
that it shall use commercially reasonable efforts to provide effective
Maintenance and Support Services while this Exhibit remains in effect.  This
warranty shall not apply to the Covered Software if such Covered Software has
been modified by any party other than SWI or its third party contractors.  In
the event that SWI fails to provide Maintenance and Support Services according
to the provisions of Section 2, SWI's only responsibility shall be to attempt
diligently to remedy such failure through further Maintenance and Support
Services.  Customer acknowledges that Maintenance and Support Services can,
under certain circumstances, result in damage to data.  Customer will therefore
ensure that all data are secured from such damage during the performance of
Maintenance and Support Services.  SWI shall not be responsible for any re-
creation or reconstruction of data.  The warranty under this Exhibit is made
only to Customer and SWI shall have no liability to any third party with respect
to the Covered Software as a result of such warranty.  SWI shall have no
obligation to Customer under the warranty, or otherwise, if an Error is the
result of (a) Customer's failure to implement all Updates or modifications to
the Covered Software; (b) changes to the operating system or environment which
adversely affect the Covered Software; (c) any alterations of or additions to
the Covered Software performed by parties other than SWI or not at the

                              Exhibit I-2 - Pg. 5.
<PAGE>

direction of SWI; (d) interconnection or integration of the Covered Software
with other software products not supported by SWI, or (e) use of the Covered
Software on equipment other than the equipment for which such Covered Software
was designed for use on. Under no circumstances does SWI warrant or represent
that all Errors can or will be corrected.

     7.3  Limited Remedy.  If defects which considerably impede the operation of
the Covered Software supplied by SWI cannot be eliminated by SWI Maintenance and
Support Services after repeated attempts, then Customer may cancel this Exhibit
for the balance of the current annual period, upon thirty (30) days prior
written notice to SWI, for the SWI Software or Customer Software or any
applicable modules or portions thereof, which cannot be used

     7.4  DISCLAIMER.  THE FOREGOING PROVISIONS OF SECTIONS 7.2 and 7.3 STATE
SWI'S SOLE AND EXCLUSIVE WARRANTY TO CUSTOMER AND SOLE OBLIGATION TO CUSTOMER
FOR BREACH OF WARRANTY, WITH RESPECT TO THIS EXHIBIT.  EXCEPT FOR THE EXPRESS
WARRANTIES STATED IN THIS SECTION, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE
LAW, NO ADDITIONAL WARRANTY, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, AS TO
THE CONDITION, QUALITY, COMPLETENESS, PERFORMANCE, MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE OF THE MAINTENANCE AND SUPPORT SERVICES, ERROR
CORRECTIONS, OR UPDATES, OR THE COMPREHENSIVENESS OF ANY DOCUMENTATION FURNISHED
HEREUNDER IS GIVEN OR ASSUMED BY CUSTOMER AND ALL SUCH WARRANTIES, CONDITIONS,
UNDERTAKING AND TERMS ARE HEREBY EXCLUDED.

                              Exhibit I-2 - Pg. 6.
<PAGE>

                           ANNEX NO. 1 TO EXHIBIT I-2

                          Description of Support Plans

1.  SUPPORT PLAN SELECTED BY CUSTOMER FOR INITIAL YEAR: ___________________

2.  EFFECTIVE DATE: ________________________

3.  DESCRIPTION OF SUPPORT PLANS:

<TABLE>
<CAPTION>
                                                                                            AROUND-THE-CLOCK SUPPORT
                                         BASIC SUPPORT PLAN      EXTENDED SUPPORT PLAN                PLAN
---------------------------------------------------------------------------------------------------------------------
<S>                                    <C>                     <C>                         <C>
Hours service is available:            9:00 a.m. to 5:00       8:30 a.m. to 5:30 p.m.      Twenty-four hours a day
                                       p.m. during business    during business days        seven days a week
                                       days                                                (including holidays)
---------------------------------------------------------------------------------------------------------------------
INITIAL RESPONSE                       Next major release of   4 hours                     4 hours
                                       the SWI Software.
                                       Level 4 errors in
                                       Custom Software shall
                                       only be corrected at
                                       SWI's discretion
---------------------------------------------------------------------------------------------------------------------
TARGET RESOLUTION: LEVEL 1 ERRORS      N/A                     2 business days             2 business days
---------------------------------------------------------------------------------------------------------------------
TARGET RESOLUTION: LEVEL 2 ERRORS      N/A                     5 business days             5 business days
---------------------------------------------------------------------------------------------------------------------
TARGET RESOLUTION: LEVEL 3 ERRORS      N/A                     20 business days            20 business days
---------------------------------------------------------------------------------------------------------------------
TARGET RESOLUTION: LEVEL 4 ERRORS      N/A                     Next major release of SWI   Next major release of SWI
                                                               Software.  Level 4 errors   Software.  Level 4 errors
                                                               in Custom Software shall    in Custom Software shall
                                                               only be corrected at        only be corrected at
                                                               SWI's discretion            SWI's discretion
---------------------------------------------------------------------------------------------------------------------
FEES (SWI SOFTWARE)                    12% of Licensed Fees    15% of license fees         20% of license fees
---------------------------------------------------------------------------------------------------------------------
FEES (CUSTOM SOFTWARE)                 Basic support plan is   25% of fixed                30% of fixed
                                       not available for       development price           development price
                                       Custom Software
---------------------------------------------------------------------------------------------------------------------
</TABLE>

     All Support Plans provide Customer with Updates to SWI Software as well as
periodic software bulletins providing additional documentation and provisional
solutions to reported problems.  As used in the tables above, the term "business
day" means Monday through Friday (excluding national holidays).  All times are
in Eastern Standard Time.

                              Exhibit I-2 - Pg. 7.
<PAGE>

                           ANNEX NO. 2 TO EXHIBIT I-2

                         Description of Custom Software

          None

          Or

          [custom software may be described by referencing the professional
services agreement it was created under, i.e.:

          Custom Software shall mean the applications described in the
Statement(s) of Work attached to the Professional Services Agreement, dated
_____, 20__, between SWI and Customer.

                              Exhibit I-2 - Pg. 8.
<PAGE>

                                   EXHIBIT J

               FORM OF SOURCE CODE ESCROW AND LICENSE AGREEMENT

                        SPEECHWORKS INTERNATIONAL, INC.
                       MASTER PREFERRED ESCROW AGREEMENT

          This Agreement is effective June __, 2000 among DSI Technology Escrow
Services, Inc. ("DSI"), SpeechWorks International, Inc. ("Depositor") and any
additional party signing the Acceptance Form attached to this Agreement
("Preferred Beneficiary"), who collectively may be referred to in this Agreement
as "the parties."

          A.  Depositor and preferred Beneficiary have entered or will enter
into a license agreement, development agreement, and/or other agreement
(referred to in this Agreement as "the License Agreement") regarding certain
proprietary technology of Depositor, pursuant to which Depositor will license to
Preferred Beneficiary one or more of Depositor's products (referred to in this
Agreement collectively as the "Product").

          B.  Depositor desires to avoid disclosure of its proprietary
technology except under certain limited circumstances.

          C.  The availability of the proprietary technology of Depositor is
critical to Preferred Beneficiary in the conduct of its business and, therefor,
Preferred Beneficiary needs access to the proprietary technology under certain
limited circumstances.

          D.  Depositor and preferred Beneficiary desire to establish an escrow
with DSI to provide for the retention, administration and controlled access of
certain proprietary technology materials of Depositor.

          E.  The parties desire this Agreement to be supplementary to the
License Agreement pursuant to 11 United States [Bankruptcy] Code, Section 365
(n).

                                   ARTICLE 1

                                    DEPOSITS

     1.1  Obligation to Make Deposit.  Upon the signing of this Agreement by the
parties, including the signing of the Acceptance Form, Depositor shall deliver
to DSI the proprietary technology and other materials ("Deposit Materials")
required to be deposited by the License Agreement or, if the License Agreement
does not identify the materials to be deposited with DSI, then such materials
will be identified on an Exhibit J-1.  If Exhibit J-1 is applicable, it is to be
prepared and signed by Depositor and preferred Beneficiary.  DSI shall have no
obligation with respect to the preparation, signing or delivery of Exhibit J-1.

                              Exhibit J - Pg. 1.
<PAGE>

     1.2  IDENTIFICATION OF TANGIBLE MEDIA.  Prior to the delivery of the
Deposit Materials to DSI, Depositor shall conspicuously label for identification
each document, magnetic tape, disk, or other tangible media upon which the
Deposit Materials are written or stored.  Additionally, Depositor shall complete
Exhibit J-2 to this Agreement by listing each such tangible media by the item
label description, the type of media and the quantity.  The Exhibit J-2 must be
signed by Depositor and delivered to DSI with the Deposit Materials.  Unless and
until Depositor makes the initial deposit with DSI, DSI shall have no obligation
with respect to this Agreement, except the obligation to notify the parties
regarding the status of the deposit account as required in Section 2.2 below.

     1.3  DEPOSIT INSPECTION.  When DSI receives the Deposit Materials and the
Exhibit J-2, DSI will conduct a deposit inspection by visually matching the
labeling of the tangible media containing the Deposit Materials to the item
descriptions and quantity listed n the Exhibit J-2.  In addition to the deposit
inspection, Preferred Beneficiary may elect to cause a verification of the
Deposit Materials in accordance with Section 1.6 below.

     1.4  ACCEPTANCE OF DEPOSIT.  At completion of the deposit inspection, if
DSI determines that the labeling of the tangible media matches the item
descriptions and quantity on Exhibit J-2, DSI will date and sign the Exhibit J-2
and mail a copy thereof to Depositor and Preferred Beneficiary.  If DSI
determines that the labeling does not match the item descriptions or quantity on
the Exhibit J-2, DSI will (a) note the discrepancies in writing on the Exhibit
J-2; (b) date and sign the Exhibit J-2 with the exceptions noted; and (c) mail a
copy of the Exhibit J-2 to Depositor and Preferred Beneficiary.  DSI's
acceptance of the deposit occurs upon the signing of the Exhibit J-2 by DSI.
Delivery of the signed Exhibit J-2 to Preferred Beneficiary is Preferred
Beneficiary's notice that the Deposit Materials have been received and accepted
by DSI.

     1.5  DEPOSITOR'S REPRESENTATIONS.  Depositor represents as follows:

          (A) Depositor lawfully possesses all of the Deposit Materials
deposited with DSI;

          (B) With respect to all of the Deposit Materials, Depositor has the
right and authority to grant to DSI and Preferred Beneficiary the rights as
provided in this Agreement;

          (C) The Deposit Materials are not subject to any lien or other similar
encumbrance, other than any lien that Depositor may have granted in the
proprietary technology that is embodied in the Deposit Materials;

          (D) The Deposit Materials consist of the proprietary technology and
other materials identified either in the License Agreement or Exhibit J-1, as
the case may be; and

          (E) The Deposit Materials are readable and useable in their current
form or, if the Deposit Materials are encrypted, the decryption tools and
decryption keys have also been deposited.

     1.6  VERIFICATION.  Preferred Beneficiary shall have the right, at
Preferred Beneficiary's expense, to cause a verification of any Deposit
Materials.  A verification

                              Exhibit J - Pg. 2.
<PAGE>

determines, in different levels of detail, the accuracy, completeness,
sufficiency and quality of the Deposit Materials. If a verification is elected
after the Deposit Materials have been delivered to DSI, then only DSI, or at
DSI's election an independent person or company selected and supervised by DSI
and who has signed a confidentiality agreement with terms and conditions
substantially similar to those set forth in Section 2.1, in which Depositor is
named as a third party beneficiary, may perform the verification. Such
verification may be requested once per Exhibit J-2, no later than thirty (30)
days after delivery thereof to DSI by Depositor. Depositor may at its discretion
designate a representative to be present at the verification.

     1.7  DEPOSIT UPDATES.  Unless otherwise provided by the License Agreement,
Depositor shall update the Deposit Materials within 60 days of each release of a
new version of the Product to be delivered under the License Agreement.  Such
updates will be added to the existing deposit.  All deposit updates shall be
listed on a new Exhibit J-2 and the new Exhibit J-2 shall be signed by
Depositor.  Each Exhibit J-2 will be held and maintained separately within the
escrow account.  An independent record will be created which will document the
activity for each Exhibit J-2.  The processing of all deposit updates shall be
in accordance with Sections 1.2 through 1.6 above.  All references in this
Agreement to the Deposit Materials shall include the initial Deposit Materials
and any updates.

     1.8  REMOVAL OF DEPOSIT MATERIALS.  The Deposit Materials may be removed
and/or exchanged only on written instructions signed by Depositor and Preferred
Beneficiary, or as otherwise provided in this Agreement.

                                   ARTICLE 2

                       CONFIDENTIALITY AND RECORD KEEPING

     2.1  CONFIDENTIALITY.  DSI shall maintain the Deposit Materials in a
secure, environmentally safe, locked facility which is accessible only to
authorized representatives of DSI.  DSI shall have the obligation to reasonably
protect the confidentiality of the Deposit Materials.  Except as provided in
this Agreement.  DSI shall not disclose, transfer, make available, or use the
Deposit Materials.  DSI shall not disclose the content of this Agreement to any
third party.  If DSI receives a subpoena or other order of a court or other
judicial tribunal pertaining to the disclosure or release of the Deposit
Materials, DSI will immediately notify the parties to this Agreement.  It shall
be the responsibility of Depositor and/or Preferred Beneficiary to challenge any
such order; provided, however, that DSI does not waive its rights to present its
position with respect to any such order.  DSI will not be required to disobey
any court or other judicial tribunal order.  (See Section 7.5 below for notices
of requested orders.)

     2.2.  STATUS REPORTS.  DSI will issue to Depositor and Preferred
Beneficiary a report profiling the account history at least semi-annually.  DSI
may provide copies of the account history pertaining to this Agreement upon the
request of any party to this Agreement.

     2.3  AUDIT RIGHTS.  During the term of this Agreement, Depositor and
preferred Beneficiary shall each have the right to inspect the written records
of DSI pertaining to this Agreement.  Any inspection shall be held during normal
business hours and following reasonable prior notice.

                              Exhibit J - Pg. 3.
<PAGE>

                                   ARTICLE 3

                             GRANT OF RIGHTS TO DSI

     3.1  TITLE TO MEDIA.  Depositor hereby transfers to DSI the title to the
media upon which the proprietary technology and materials are written or stored.
However, this transfer does not include the ownership of the proprietary
technology and materials contained on the media such as any copyright, trade
secret, patent or other intellectual property rights.

     3.2  RIGHT TO MAKE COPIES.  DSI shall have the right to make copies of the
Deposit Materials as reasonably necessary to perform this Agreement.  DSI shall
copy all copyright, nondisclosure, and other proprietary notices and titles
contained on the Deposit Materials onto any copies made by DSI.  With all
Deposit Materials submitted to DSI.  Depositor shall provide any and all
instructions as may be necessary to duplicate the Deposit Materials including
but not limited to the hardware and/or software needed.

                                   ARTICLE 3

                               RELEASE OF DEPOSIT

     4.1  RELEASE CONDITION.  As used in this Agreement, "Release Condition"
shall mean the following:

          (a) The occurrence and continuance of a material breach by Depositor
of its maintenance and support obligations under the License Agreement, which
adversely affects core functionality of the Product licensed to Preferred
Beneficiary under the License Agreement, and which remains uncured ninety (90)
days after written notice thereof; or

          (b) Any rejection or termination of the License Agreement under Title
II of the United States Code, as now constituted or hereafter amended (the
"Bankruptcy Code"), or any other federal, or state bankruptcy, insolvency,
receivership, or similar law; or

          (c) Depositor ceases doing business in the normal course for a
continuous period of ninety (90) days.

     4.2  FILING FOR RELEASE.  If Preferred Beneficiary believes in good faith
that a Release Condition has occurred, Preferred Beneficiary may provide to DSI
written notice of the occurrence of the Release Condition and a request for the
release of the Deposit Materials.  Upon receipt of such notice, DSI shall
provide a copy of the notice to Depositor by commercial express mail.

     4.3  CONTRARY INSTRUCTIONS.  From the date DSI mails the notice requesting
release of the Deposit Materials, Depositor shall have twenty business days to
deliver to DSI Contrary Instructions.  "Contrary Instructions" shall mean the
representation by Depositor that a Release Condition has not occurred or has
been cured.  Upon receipt of Contrary Instructions, DSI shall send a copy to
Preferred Beneficiary by commercial express mail.  Additionally, DSI shall
notify both Depositor and Preferred Beneficiary that there is a dispute to be
resolved pursuant to the Dispute Resolution section of this Agreement (Section
7.3).  Subject to Section 5.2, DSI will

                              Exhibit J - Pg. 4.
<PAGE>

continue in store the Deposit Materials without release pending (a) joint
instructions from Depositor and Preferred Beneficiary; (b) resolution pursuant
to the Dispute Resolution provisions; or (c) order of a court.

     4.4  RELEASE OF DEPOSIT.,  If DSI does not receive Contrary Instructions
from the Depositor, DSI is authorized to release the Deposit Materials to the
Preferred Beneficiary or, if more than one beneficiary is registered to the
deposit, to release a copy of the Deposit Materials to the Preferred Beneficiary
requesting release.  However, DSI is entitled to receive any fees due DSI before
making the release.  Any copying expense in excess of $300 will be chargeable to
Preferred Beneficiary.  Upon any such release, the escrow arrangement will
terminate as it relates to the Depositor and Preferred Beneficiary involved in
the release.

     4.5  RIGHT TO USE AFTER RELEASE.  Unless otherwise provided in the License
Agreement, upon release of the Deposit Materials in accordance with this Article
4, Preferred Beneficiary shall have the right to use the Deposit Materials for
the sole purpose of supporting licensed copies of the then current version of
the Product that Preferred Beneficiary is contractually obligated to support,
and not for the purpose of developing or distributing enhancements of the
Product.,  Preferred Beneficiary shall be obligated to maintain the
confidentiality of the released Deposit Materials.

                                   ARTICLE 5

                              TERM AND TERMINATION

     5.1  TERM OF AGREEMENT.  The initial term of this Agreement is for a period
of one year.  Thereafter, this Agreement shall automatically renew from year-to-
year unless (a) Depositor and Preferred Beneficiary jointly instruct DSI in
writing that the Agreement is terminated; (b) Preferred Beneficiary instructs
DSI in writing that the Agreement is terminated as it relates to Preferred
Beneficiary; or (c) the Agreement is terminated by DSI for nonpayment in
accordance with Section 5.2.  If the Acceptance Form has been signed at a date
later than this Agreement, the initial term of the Acceptance Form will be for
one year with subsequent terms to be adjusted to match the anniversary date of
this agreement.  If the deposit materials are subject to another escrow
agreement with DSI, DSI reserves the right, after the initial one year term, to
adjust the anniversary date of this agreement to match the then prevailing
anniversary date of such other escrow arrangement.

     5.2  TERMINATION FOR NONPAYMENT.  In the event of the nonpayment of fees
owed to DSI, DSI shall provide written notice of delinquency to the parties to
this Agreement affected by such delinquency.  Any such party shall have the
right to make the payment to DSI to cure the default.  If the past due payment
is not received in full by DSI within one month of the date of such notice, then
at any time thereafter DSI shall have the right to terminate this Agreement to
the extent it relates to the delinquent party by sending written notice of
termination to such affected parties.  DSI shall have no obligation to take any
action under this Agreement so long as any payment due to DSI remains unpaid.

     5.3  DISPOSITION OF DEPOSIT MATERIALS UPON TERMINATION.  Upon termination
of this Agreement, DSI shall destroy, return, or otherwise deliver the Deposit
Materials in accordance

                              Exhibit J - Pg. 5.
<PAGE>

with Depositor's instructions. If there are no instructions, DSI may, at its
sole discretion, destroy the Deposit Materials or return them to Depositor. DSI
shall have no obligation to return or destroy the Deposit Materials if the
Deposit Materials are subject to another escrow agreement with DSI.

     5.4  SURVIVAL OF TERMS FOLLOWING TERMINATION.  Upon termination of this
Agreement, the following provisions of this Agreement shall survive:

          (a) Depositor's Representations (Section 1.5);

          (b) The obligations of confidentiality with respect to the Deposit
Materials;

          (c) The rights granted in the sections entitled Right to Transfer Upon
Release (Section 3.3) and Right to Use Following Release (Section 4.5), if a
release of the Deposit Materials has occurred prior to termination;

          (d) The obligation of Preferred Beneficiary to pay DSI any fees and
expenses due;

          (e)  The provisions of Article 7; and

          (f) Any provisions in this Agreement which specifically state they
survive the termination or expiration of this Agreement.

                                   ARTICLE 6

                                   DSI'S FEES

     6.1  FEE SCHEDULE.  All fees and expenses charged by [     ]. [     ] shall
not be required to [     ] for any such fees, expenses or other charges billed
to [     ].  DSI is entitled to be paid its standard fees and expenses
applicable to the services provided.  DSI shall notify [     ], the party
responsible for payment of DSI's fees hereunder, at least 90 days prior to any
increase in fees.  For any service not listed on DSI's standard fee schedule,
DSI will provide a quote prior to rendering the service, if requested.

     6.2  PAYMENT TERMS.  DSI shall not be required to perform any service
unless the payment for such service and any outstanding balances owed to DSI are
paid in full.  Fees are due upon receipt of a signed contract or receipt of the
Deposit Materials whichever is earliest.  If invoiced fees are not paid, DSI may
terminate this Agreement in accordance with Section 5.2.  Late fees on past due
amounts shall accrue interest at the rate of one and one-half percent per on the
(18% per annum) from the date of the invoice.

                                   ARTICLE 7

                             LIABILITY AND DISPUTES

     7.1  RIGHT TO RELY ON INSTRUCTIONS.  DSI may act in reliance upon any
instruction, instrument, or signature reasonably believed by DSI to be genuine.
DSI may assume that any

                              Exhibit J - Pg. 6.
<PAGE>

employee of a party to this Agreement who gives any written notice, request, or
instruction has the authority to do so. DSI shall not be responsible for failure
to act as a result of causes beyond the reasonable control of DSI.

     7.2  INDEMNIFICATION.  DSI shall be responsible to perform its obligations
under this Agreement and to act in a reasonable and prudent manner with regard
to this escrow arrangement.  Provided DSI has acted in the manner stated in the
preceding sentence, Depositor and preferred Beneficiary each agree to indemnify,
defend and hold harmless DSI from any and all claims, actions, damages,
arbitration fees and expenses, costs, attorney's fees and other liabilities
incurred by DSI relating in any way to this escrow arrangement.

     7.3  DISPUTE RESOLUTION.  Any dispute relating to or arising from this
Agreement shall be resolved by arbitration under the Commercial Rules of the
American Arbitration Association.  Unless otherwise agreed by Depositor and
Preferred Beneficiary, arbitration will take place in Boston, Massachusetts,
USA.  Any court having jurisdiction over the matter may enter judgment on the
award of the arbitrator(s).  Service of a petition to confirm the arbitration
award may be made by First Class mail or by commercial express mail, to the
attorney for the party or, if unrepresented, to the party at the last known
business address.

     7.4  CONTROLLING LAW.  This Agreement is to be governed and construed in
accordance with the laws of the Commonwealth of Massachusetts without regard to
its conflict of law provisions.

     7.5  NOTICE OF REQUESTED ORDER.  If any party intends to obtain an order
from the arbitrator or any court of competent jurisdiction which may direct DSI
to take, or refrain from taking any action, that party shall:

          (a) Give DSI at least two business days' prior notice of the hearing;

          (b) Include in any such order that, as a precondition to DSI's
obligation, DSI be paid in full for any past due fees and be paid for the
reasonable value of the services to be rendered pursuant to such order; and

          (c) Ensure that DSI not be required to deliver the original (as
opposed to a copy) of the Deposit Materials if DSI may need to retain the
original in its possession to fulfill any of its other escrow duties.

                                   ARTICLE 8

                               GENERAL PROVISIONS

     8.1  ENTIRE AGREEMENT.  This Agreement, which includes the Acceptance Form
and the Exhibits described herein, embodies the entire understanding among all
of the parties with respect to its subject matter and supersedes all previous
communications, representations or understandings, either oral or written.  DSI
is not a party to the License Agreement between Depositor and preferred
Beneficiary and has no knowledge of any of the terms or provisions of any such
License Agreement.  DSI's only obligations to Depositor or Preferred Beneficiary
are as set forth in this Agreement.  No amendment or modification of this
Agreement shall be valid

                              Exhibit J - Pg. 7.
<PAGE>

or binding unless signed by all the parties hereto, except that Exhibit J-1 need
not be signed by DSI, Exhibit J-2 need not be signed by preferred Beneficiary
and the Acceptance Form need only be signed by the parties identified therein.

     8.2  NOTICES.  All notices, invoices, payments, deposits and other
documents and communications shall be given to the parties at the addresses
specified in the attached Exhibit C and Acceptance Form.  It shall e the
responsibility of the parties to notify each other as provided in this Section
in the event of a change of address.  The parties shall have the right to rely
on the last known address of the other parties.  Unless otherwise provided in
this Agreement, all documents and communications may be delivered by First Class
mail.

     8.3  SEVERABILITY.  In the event any provision of this Agreement is found
to be invalid, voidable or unenforceable, the parties agree that unless it
materially affects the entire intent and purpose of this agreement, such
invalidity, voidability or unenforceability shall affect neither the validity of
this agreement nor the remaining provisions herein, and the provision in
question shall be deemed to be replaced with a valid and enforceable provision
most closely reflecting the intent and purpose of the original provision.

     8.4  SUCCESSORS.  This Agreement shall be binding upon and shall inure to
the benefit of the successors and assigns of the parties.  However, DSI shall
have no obligation in performing this Agreement to recognize any successor or
assign of Depositor or Preferred Beneficiary unless DSI receives clear,
authoritative and conclusive written evidence of the change of parties.

     8.5  REGULATIONS.  Depositor and Preferred Beneficiary are responsible for
and warrant compliance with all applicable laws, rules and regulations,
including but nor limited to customs laws, import, export, and re-export laws
and government regulations of any country from or to which the Deposit Materials
may be delivered in accordance with the provisions of this Agreement.

                              Exhibit J - Pg. 8.
<PAGE>

SPEECHWORKS INTERNATIONAL, INC. DSI TECHNOLOGY ESCROW SERVICES, INC.

By:                                   By:
     -------------------------             ---------------------------
Name:                                 Name:
     -------------------------             ---------------------------
Title:                                Title:
     -------------------------             ---------------------------
Date:                                 Date:
     -------------------------             ---------------------------

                              Exhibit J - Pg. 9.
<PAGE>

                             PREFERRED BENEFICIARY

                                ACCEPTANCE FORM

                                 Account Number

          Depositor, Preferred Beneficiary and DSI Technology Escrow Services,
Inc. ("DSI"), hereby acknowledge that ______________________________ is the
Preferred Beneficiary referred to in the Master Preferred Escrow Agreement
effective ______________, 20_____ with DSI as the escrow agent and SpeechWorks
International, Inc. as the Depositor.  Preferred Beneficiary hereby agrees to be
bound by all provisions of such Agreement.

Depositor hereby enrolls Preferred Beneficiary to the following account(s):

Account Name                            Account Number

----------------------------------      ---------------------------------------

----------------------------------      ---------------------------------------

----------------------------------      ---------------------------------------

Notices and communications to Preferred   Invoices should be addressed to

Beneficiary should be addressed to:       Preferred Beneficiary at:

Company Name:
             ---------------------      ---------------------------------------
Address:
        --------------------------      ---------------------------------------

        --------------------------      ---------------------------------------

        --------------------------      ---------------------------------------

Designated Contact:                     Contact:
                   ---------------              -------------------------------
Telephone:
          ------------------------      ---------------------------------------
Facsimile:                              P.O. #, if required:
          ------------------------      ---------------------------------------

                                               SPEECHWORKS INTERNATIONAL, INC.
----------------------------------------

                              Exhibit J - Pg. 10.
<PAGE>

Preferred Beneficiary

By:                                       By:
      ----------------------------              ------------------------------
Name:                                     Name:
      ----------------------------              ------------------------------
Title:                                    Title:
      ----------------------------              ------------------------------
Date:                                     Date:
      ----------------------------              ------------------------------

DSI Technology Escrow Services, Inc.

By:
      ----------------------------
Name:
      ----------------------------
Title:
      ----------------------------
Date:
      ----------------------------

                              Exhibit J - Pg. 11.
<PAGE>

                                 EXHIBIT J-1

                          MATERIALS TO BE DEPOSITED

                     Account Number
                                    ----------------------

Depositor represents to Preferred Beneficiary that Deposit Materials delivered
to DSI shall consist of the following:

SPEECHWORKS INTERNATIONAL, INC.
                                        ---------------------------------------
                                        Preferred Beneficiary

By:                                       By:
      ----------------------------              ------------------------------
Name:                                     Name:
      ----------------------------              ------------------------------
Title:                                    Title:
      ----------------------------              ------------------------------
Date:                                     Date:
      ----------------------------              ------------------------------

                             Exhibit J-1 - Pg. 1.
<PAGE>

                                  EXHIBIT J-2

                        DESCRIPTION OF DEPOSIT MATERIALS

Depositor:     SPEECHWORKS INTERNATIONAL, INC.

Account Number:
               ---------------------------------------------------------------
Product Name:                                     Version
               ----------------------------------        ---------------------

(Product Name will appear on Account History report)

DEPOSIT MATERIAL DESCRIPTION:

<TABLE>
<CAPTION>
Quantity    Media Type & Size            Label Description of Each Separate Item
                                         (Please use other side if additional space is needed)
<S>         <C>                          <C>
__________  Disk 3.5" or _____

__________  DAT tape ____ mm

__________  CD-ROM

__________  Data cartridge tape ___

__________  TK 70 or ____ tape

__________  Magnetic tape ____

__________  Documentation

__________  Other __________________
</TABLE>

PRODUCT DESCRIPTION
Operating System:
                  -------------------------------------------------------------
Hardware Platform:
                  -------------------------------------------------------------

DEPOSIT COPYING INFORMATION

Is the media encrypted: Yes/No   If yes, please include any passwords and the
decryption tools.

                             Exhibit J-2 - Pg. 1.
<PAGE>

Encryption tool name:                             Version
                     ----------------------------        ----------------------

Hardware required:
                  -------------------------------------------------------------
Software required:
                  -------------------------------------------------------------

I certify for DEPOSITOR that the above   DSI has inspected and accepted the
described Deposit Materials have been    above materials (any exceptions are
transmitted to DSI:                      noted above):

Signature:                                Signature:
           --------------------------                --------------------------
Print Name:                               Print Name:
           --------------------------                --------------------------
Date:                                     Date Accepted:
           --------------------------                --------------------------
                                          Exhibit J-2#:
                                                     --------------------------

Send materials to: DSI, 9265 Sky Park Court, #202, San Diego, CA 92123
(858) 499-1600

                             Exhibit J-1 - Pg. 2.
<PAGE>

                                  EXHIBIT J-3

                              DESIGNATED CONTACT

                      Account Number
                                    ---------------------

Notices and communications should be      Invoices should be addressed to
addressed to:                             Preferred Beneficiary at:

Company Name:  SpeechWorks
             ------------------------     ------------------------------------
               International, Inc.
             ------------------------     ------------------------------------
Address:   695 Atlantic Avenue
         ----------------------------     ------------------------------------
           Boston, MA  02111
         ----------------------------     ------------------------------------

         ----------------------------     ------------------------------------

Designated Contact: Corporate Counsel     Contact:
                    -----------------             ----------------------------
Telephone:  617-428-4444
          ---------------------------     ------------------------------------
Facsimile:   617-428-1122                 P.O. #, if required:
          ---------------------------                         ----------------

Requests to change the designated contact should be given in writing by the
designated contact or an authorized employee.

Contracts, Deposit Materials and          Invoice inquiries and fee
notices to DSI should be addressed to:    remittances to DSI should be
                                          addressed to:

DSI                                       DSI

Contract Administration                   Accounts Receivable

Suite 202                                 Suite 1450

9265 Sky Park Court                       425 California Street

San Diego, CA  92123                      San Francisco, CA  94104

Telephone: (858) 499-1600                 (415) 398-7900

Facsimile:  (858) 694-1919                (415) 398-7914

Date:
     --------------------------------------------

                             Exhibit J-3 - Pg. 1.
<PAGE>

                                   EXHIBIT K

                          Form of Joint Press Release

Kevin Compton, AT&T               Leah Lesser, SpeechWorks
650-463-7069                      617-428-4444
kcompton@att.com                  leah.lesser@speechworks.com
----------------                 ---------------------------

For Release Monday, June 12, 2000

AT&T, SPEECHWORKS PARTNER ON SPEECH-ENABLED SERVICES

SpeechWorks Solutions to Incorporate State-of-Art AT&T Labs Technologies
------------------------------------------------------------------------

     BASKING RIDGE, N.J. and BOSTON, MA. - AT&T and SpeechWorks International,
Inc., today announced an agreement for SpeechWorks to develop products, using
AT&T Labs' leading-edge speech-processing technologies, that the two parties
will market to AT&T business units serving 80 million customers.

     The agreement pairs AT&T, with its long history of world-class speech
research and related services, with SpeechWorks' development capabilities as a
leading provider of speech-enabled products that today serve the customers of
Apple Computer, Cellular One, E*Trade, Federal Express, Hewlett-Packard, United
Airlines and other businesses.  In return for a license to its technologies,
AT&T receives a minority ownership stake in the privately-held SpeechWorks.

     AT&T and SpeechWorks will collaborate to deploy next-generation, speech-
enabled services such as:

     -- AT&T "How May I Help You?SM" Service: a natural-language processing
application that lets customers calling into a call center speak freely with an
automated customer support application.  Unlike applications that exist in the
market today, "How May I Help You?" does not require users to speak pre-defined
phrases to the application.

     -- Directory Assistance Using Large-Vocabulary Recognition: an application
that enables automated directory assistance (e.g., retrieving name and number or
email address) with over 100,000 entries.  Current systems in the market do not
allow as many entries, and so are not sufficient for the large-vocabulary
applications AT&T requires in deploying such services.

                              Exhibit K - Pg. 1.
<PAGE>

     -- Next-Generation Text-to-Speech Technology: a computer application that
can generate nearly natural-sounding speech for services such as retrieving
information from a database (e.g., restaurant names, driving directions), or for
having email read over the phone automatically.

     "Working with a fast-moving partner like SpeechWorks allows us to take our
technologies to market much more quickly," said Dave Nagel, AT&T Labs President
and AT&T CTO.  "We've identified a number of areas where we could benefit from
speech-enabled solutions, including customer care operations, and mobile
services for which speech will be a logical interface - especially when
cellphones are the size of fountain pens.  And with more cellphones being sold
today than personal computers, we expect that speech could do for the wireless
Web what the browser did for the Internet"

     SpeechWorks will receive support from AT&T Labs' expert researchers to
provide enhancements to its products in the future, and AT&T will receive
discounts on the support required to put those products to work in its business
and consumer offerings.

     "AT&T's world-renowned speech technology gives us a competitive advantage
in tying the phone to the Internet, and to customer care applications," said
Stuart Patterson, CEO of SpeechWorks.  "It will help us fundamentally improve
and broaden the usefulness of the telephone."

About AT&T Labs
---------------

     AT&T's services are backed by the research and development capabilities of
AT&T Labs, which is working to create the information services and
communications network of tomorrow. AT&T Labs is a leader in the development of
technologies and standards for audio, speech, video and image compression;
electronic commerce and digital copyright management; search and directory
services; speech processing and coding of all sorts; network architecture,
design, engineering and operations; and other areas critical to the advancement
of new broadband communications and Internet offerings. [List several key
advances to speech technology from AT&T over the years?]

About SpeechWorks International, Inc.
-------------------------------------

     Headquartered in Boston with offices worldwide, SpeechWorks is a privately
held corporation with financing from Bank of America Ventures, Citigroup's e-
Citi Unit, GE Equity, Intel Corporation, MCI WorldCom Venture Fund, Reuters and
SAP.  Additional funding comes from venture capital firms including Atlas
Venture, Charles River Ventures, iGate Ventures, The Intel64 Fund, QuestMark
Partners and Riggs Capital.  To experience the power of SpeechWorks, call toll-
free: 1.888.SAY.DEMO. For additional information, call 617.428.4444 or visit
http://www.speechworks.com.

                              Exhibit K - Pg. 2.<PAGE>

                                                                   EXHIBIT 10.14

SpeechWorks International, Inc. has omitted from this Exhibit 10.14 portions of
the Agreement for which SpeechWorks International, Inc. has requested
confidential treatment from the Securities and Exchange Commission. Omitted
language is indicated by brackets (i.e. [ ]). The portions of the Agreement for
which confidential treatment has been requested have been filed separately with
the Securities and Exchange Commission.

              SOFTWARE LICENSE AND PROFESSIONAL SERVICES AGREEMENT

                                    BETWEEN

                        SPEECHWORKS INTERNATIONAL, INC.

                                      AND

                              AMERICA ONLINE, INC.

                              DATED JUNE 29, 2000

<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                   Page
<S>                                                                                                  <C>

SECTION 1 --DEFINITIONS.......................................................................        1
SECTION 2 -- GRANT OF RIGHTS..................................................................        4
 2.1   Software License.......................................................................        4
 2.2   Documentation License..................................................................        5
 2.3   Copies.................................................................................        6
 2.4   Restrictions; Acknowledgement of Proprietary Rights....................................        6
 2.5   Trademarks.............................................................................        6
 2.6   Audit Rights...........................................................................        6
 2.7   Additional Recognition Ports and System Seats..........................................        7
 2.8   Delivery...............................................................................        7
SECTION 3 -- PROFESSIONAL AND TRANSITION SERVICES.............................................        7
 3.1   Professional Services..................................................................        7
 3.2   Transition Services....................................................................        7
SECTION 4 -- MAINTENANCE AND SUPPORT SERVICES.................................................        7
SECTION 5 - ADDITIONAL OBLIGATIONS OF SPEECHWORKS.............................................        8
 5.1   AOL Branded Content....................................................................        8
 5.2   Open Architecture......................................................................        9
 5.3   Additional Languages...................................................................        9
SECTION 6 -- CONSIDERATION.....................................................................      10
 6.1  Initial License Fee......................................................................      10
 6.2  Deployment Period Extension Fees; Limit on Deployment Period
      Extension Fees...........................................................................      10
6.3  Professional Services Fees...............................................................       10
6.4  Maintenance and Support Fees.............................................................       10
6.5  Revenue Sharing..........................................................................       10
6.6  Payment..................................................................................       11
6.7  Taxes....................................................................................       12
6.8  Records; Audit...........................................................................       12
6.9  Third Party Software License Fees........................................................       12
SECTION 7 -- COMMON STOCK AND WARRANT PURCHASE AGREEMENT......................................       12
SECTION 8 -- CONFIDENTIAL INFORMATION.........................................................       12
8.1  Confidential Information.................................................................       12
8.2  Definition of Confidential Information...................................................       13
8.3  Return of Confidential Information.......................................................       13
SECTION 9 -- WARRANTIES AND DISCLAIMER........................................................       13
9.1 Warranties................................................................................       13
9.2 Remedies..................................................................................       14
9.3 Disclaimer.................................................................................      15
9.4 Limitation of Liability....................................................................      15
9.5 No Consequential Damages...................................................................      15
SECTION 10 -- INFRINGEMENT MATTERS; INDEMNITIES................................................      15
10.1 Indemnities...............................................................................      15
10.2 Limited Remedies..........................................................................      15
10.3 Limitation of Liability; Additional Indemnities...........................................      16
SECTION 11 -- DEPLOYMENT PERIOD; TERM; TERMINATION.............................................      16
11.1 Initial Deployment Period; Optional Extension; Automatic Extension........................      16
11.2 Term......................................................................................      17
11.3 Termination By Either Party...............................................................      17
11.4 Termination for Bankruptcy/Insolvency or Changes in Business..............................      17

</TABLE>

                                      -i-
<PAGE>

<TABLE>
<CAPTION>

                                                                                                   Page
<S>                                                                                                  <C>

11.5 Termination by AOL........................................................................      17
11.6 Effect of Termination.....................................................................      18
11.7 Survival..................................................................................      18
SECTION 12 -- SOURCE CODE ESCROW...............................................................      18
SECTION 13 -- ASSIGNMENT AND CHANGE OF CONTROL.................................................      18
13.1 Assignment................................................................................      18
13.2 Mergers, Acquisition of Assets or Change of Control.......................................      19
13.3 Acquisition of Specified SpeechWorks Competitor...........................................      20
SECTION 14 -- DISPUTE RESOLUTION...............................................................      20
14.1 Amicable Resolution.......................................................................      20
14.2 Arbitration...............................................................................      20
SECTION 15 -- GENERAL TERMS....................................................................      21
15.1 Force Majeure.............................................................................      21
15.2 Notices...................................................................................      21
15.3 Relationship Between the Parties..........................................................      21
15.4 Governing Law.............................................................................      21
15.5 Export Controls; Government Use...........................................................      21
15.6 Entire Agreement; Headings; Counterparts..................................................      21
15.7 Publicity.................................................................................      21
15.8 Partial Invalidity; Waiver................................................................      22
15.9 Non-Solicitation..........................................................................      22
15.10 AOL Primarily Liable.....................................................................      22
15.11 Most Favorable...........................................................................      22

EXHIBITS:
--------

Exhibit A - SpeechWorks Software; Products
Exhibit B - Order Form
Exhibit C - Professional Services
Exhibit D - Maintenance and Support Services
Exhibit E - Common Stock and Warrant Purchase Agreement; Related Documents
Exhibit F - Form of Source Code Escrow and License Agreement
Exhibit G - Publicity
</TABLE>

                                      -ii-
<PAGE>

              SOFTWARE LICENSE AND PROFESSIONAL SERVICES AGREEMENT

THIS SOFTWARE LICENSE AND PROFESSIONAL SERVICES AGREEMENT (this "Agreement"),
dated as of June 28, 2000 (the "Effective Date"), is by and between SPEECHWORKS
INTERNATIONAL, INC., a Delaware corporation ("SpeechWorks"), with offices at 695
Atlantic Ave., Boston, MA 02111; and AMERICA ONLINE, INC., a Delaware
corporation ("AOL"), with offices at 22000 AOL Way, Dulles, VA 20166.

                                  INTRODUCTION

A.  SpeechWorks is the developer and owner of or has the right to license
    certain speech recognition technology and certain related software.

B.  SpeechWorks has agreed to grant to AOL, and AOL has agreed to accept from
    SpeechWorks, a license to use such software upon the terms and conditions
    set forth below.

C.  SpeechWorks has also agreed to provide certain specified maintenance and
    support services, and certain specified software development services, to
    AOL upon the terms and conditions set forth below.

For and in consideration of, and conditioned on, the covenants stated herein,
and for other good and valuable consideration, the receipt and sufficiency of
which the parties hereby acknowledge, the parties hereby agree as follows:

                               TERMS OF AGREEMENT

SECTION 1 -- DEFINITIONS

     In addition to the terms defined above and elsewhere in this Agreement, the
following terms as used in this Agreement shall have the meanings set forth
below:

  "Acquiring Entity" shall have the meaning specified in Section 13.2 of this
  Agreement.

  "Affiliate" shall mean an entity controlling, controlled by, or under common
  control with, a party, where "control" means ownership of outstanding capital
  stock representing more than [     ] percent [     ] of the voting power of an
  entity.  With respect to AOL, the term "Affiliate" shall also include (a)
  affiliates and subsidiaries of AOL in which AOL owns at least a [     ]
  percent ([     ]%) equity and voting interest; provided, however, [     ]; and
  (b) from and after the date when the merger of AOL and Time Warner Inc. is
  completed, Time Warner Inc. and entities controlled by Time Warner Inc.

  "Agreement" shall mean this Agreement, all attached Exhibits, and any other
  documents made a part hereof or incorporated by reference herein, including
  any written amendments hereto.

  "AOL Brand" shall mean any and all brands owned by AOL or any AOL Affiliate.

  "AOL Branded Content" shall mean content provided to end users of the AOL
  Voice Portal  under a brand name owned by AOL or any AOL Affiliate.  AOL
  Branded Content presently includes, without limitation, "AOL Instant
  Messenger/ICQ" for instant messaging functionality, "Moviefone" for movie
  listings and content, "Mapquest" for mapping and directions, "Digital City"
  for local entertainment, "Spinner/Winamp" for music, "CNN" for news and
  sports.

                                      -1-
<PAGE>

  "AOL Technology" shall mean proprietary technology of AOL and of third parties
  provided to SpeechWorks in connection with SpeechWorks' performance of
  services hereunder.

  "AOL User Information" shall mean any information, including, without
  limitation, usage information or other identifying information collected by
  AOL in connection with a user's registration for an AOL Voice Portal.

  "AOL Voice Portal" shall mean any service owned by AOL or an AOL Affiliate or
  branded, or co-branded, under an AOL Brand, employing speech recognition
  technology as the user interface, pre-recorded voice responses and/or text-to-
  speech technology to offer AOL Voice Portal Content.

  "AOL Voice Portal Content" shall mean AOL Branded Content and any and all
  other content created, purchased, acquired, or otherwise obtained (now or
  hereafter) by AOL or AOL Affiliates.

  "AOL Voice Portal Revenue" shall mean all cash advertising, sponsorship,
  subscription and transaction revenue, net of reasonable direct costs (such
  revenue in general, "Portal Revenue") which is directly attributable to an AOL
  Voice Portal on which the SpeechWorks Software is then in use. In the event
  such an AOL Voice Portal is part of a larger transaction resulting in Portal
  Revenue, then the Portal Revenue from such transaction shall be attributed to
  such relevant AOL Voice Portal pro rata by AOL using its standard
  methodologies for such attribution to its brands and properties. For purposes
  of this paragraph, the term "reasonable direct costs" shall exclude all
  overhead allocations, and, except for reasonable direct costs that are
  directly attributable to transaction revenue and exceed [ ] percent ([ ]%) of
  gross transaction revenue, shall not exceed [ ] percent ([ ]%) of gross
  revenues.

  "Confidential Information" shall have the meaning specified in Section 8.2 of
  this Agreement.

  "Custom Software" shall mean the specific computer programs developed (or to
  be developed) by SpeechWorks pursuant to a Statement of Work under this
  Agreement.

  "Custom Software Documentation" shall mean the  functional specifications and
  all other related materials related to the Custom Software specified in a
  Statement of Work under Exhibit C hereto.  SpeechWorks shall supply, in the
  English language, in both eye-readable and machine-readable, printable form,
  all Custom Software Documentation reasonably necessary for all appropriately
  trained AOL personnel to facilitate the use and application of the Custom
  Software in accordance with the provisions of this Agreement.

  "Deployment Period" shall have the meaning specified in Section 11.1 of this
  Agreement.

  "Disclosing Party" shall have the meaning specified in Section 8.1 of this
  Agreement.

  "Documentation" shall mean the operating manuals, user instructions,
  functional specifications, and all other materials related to the SpeechWorks
  Software, including updates and revisions of the foregoing as may be, from
  time to time, delivered by SpeechWorks to its licensees generally in the
  English language, in both eye-readable and machine-readable, printable form.

  "Escrow Agreement" shall have the meaning specified in Section 12 of this
  Agreement.

  "Installation Report" shall mean a report specifying the number of ports and
  location at which deployed, and the application for which the SpeechWorks
  Software shall be used and if other than AOL, the name of the Affiliate,
  Contractor or Subcontractor.

                                      -2-
<PAGE>

 "Licensed Software" shall mean the SpeechWorks Software and the Custom
 Software.

 "Object Code" shall mean software assembled or compiled in magnetic or
 electronic binary form on software media that is readable and usable by
 machines but not generally readable by humans without reverse assembly,
 reverse compiling or reverse engineering.

 "Receiving Party" shall have the meaning specified in Section 8.1 of this
 Agreement.

 "Recognition Port" shall mean the number of telephone channels enabled with
 the software included in SpeechWorks Dialog Module Bundle C (or the highest
 then-current bundle) that is capable of either recognizing spoken words or
 performing "barge-in" for a discrete period of time.

 "Registered User" shall mean a user of an AOL Voice Portal who has chosen or
 been assigned a unique identifier and a password in connection with an AOL
 Voice Portal.

 "Rich Voice Content" shall mean the rich voice content that SpeechWorks owns
 and offers to its commercial customers for use with the SpeechWorks Software.
 The Rich Voice Content available as of the Effective Date is listed on Exhibit
 A.

 "Source Code" shall mean computer software written in programming languages
 including all comments and procedural code such as job control language
 statements, in a form intelligible to trained programmers, and capable of
 being translated into Object Code form for operation on computer equipment
 through assembly or compiling.

 "Specified AOL Competitors" shall mean an [     ]one or more of the following:
 (i) [     ] or [     ] (e.g., [     ]); (ii) [     ] or [     ] a [     ] of
 [    ] or [     ] (or [     ]) (e.g., [     ] and [     ]) and/or [     ]
 and/or [    ] and/or [     ] (e.g., [     ] and/or [     ] [     ] or [     ]
 and/or [     ]); and (iii) [     ], [     ] or [     ].

 "Specified SpeechWorks Competitors" shall mean any entity for which licensing
 or otherwise marketing software substantially similar to SpeechWorks software
 for automated speech recognition for use over a circuit-switched or a packet-
 switched network (or other SpeechWorks' software that may be provided to AOL
 under this Agreement) constitutes a substantial revenue source.

 "SpeechWorks Software" shall mean, collectively or individually, the software
 programs described in Exhibit A attached hereto, in Object Code format, and
 including all corrections, modifications, enhancements and upgrades to such
 software, which may be provided to AOL by SpeechWorks hereunder pursuant to
 the terms of this Agreement or any separate license and/or support agreement
 entered into by the parties hereto.

 "Statement of Work" shall have the meaning specified in Exhibit C to this
 Agreement.

 "System Seat" shall mean the number of end-users permitted to concurrently
 access and use, at the same time, the SpeechWorks Tools and GrammarLibraries.

 "Term" shall have the meaning specified in Section 11.2 of this Agreement.

 "Trigger Event" shall have the meaning specified in Section 13.2 of this
 Agreement.

 "Version" shall have the meaning specified in Exhibit D to this Agreement.

                                      -3-
<PAGE>

SECTION 2  - GRANT OF RIGHTS

2.1  Software License

     (a)  Subject to the terms, conditions and restrictions set forth in this
Agreement:

          (i) SpeechWorks hereby grants to AOL and its Affiliates, and AOL
hereby accepts for itself and its Affiliates, a non-exclusive, non-transferable,
non-sublicensable, perpetual and irrevocable (subject to Section 11.6) worldwide
right and license to use, execute, perform and display the SpeechWorks Software
solely in connection with the use of an AOL Voice Portal by AOL Voice Portal
users;

          (ii) Without limiting the generality of Section 2.1(a)(i), AOL shall
have the right to grant access to, and permit the use of the SpeechWorks
Software by, contractors and subcontractors retained from time to time by AOL or
any of its Affiliates solely as needed to furnish professional or technical
services to AOL or any of its Affiliates in connection with an AOL Voice Portal,
provided that such contractors and subcontractors execute an agreement with AOL
which contains provisions no less protective of the intellectual property rights
of SpeechWorks than those contained herein; and

          (iii) In partial consideration of the warrants to be issued pursuant
to the Common Stock and Warrant Purchase Agreement referenced in Section 7,
subject to clauses (I)-(III) of this Section 2.1(a)(iii) and the other terms of
this Section, SpeechWorks hereby authorizes AOL to grant licenses to the
SpeechWorks Software to third parties identified in writing by AOL whose content
is accessible by speech activated services via an AOL Voice Portal
(notwithstanding that [     ], including but not limited to [     ] or via other
[     ], provided, however, that the SpeechWorks Software shall not be used for
such other access), at [     ] cost to AOL or such third parties for such
SpeechWorks Software.  Such licenses shall be limited non-exclusive, non-
transferable, non-sublicensable, worldwide licenses, for a period of twenty four
(24) months from the date of grant of each such license, to use the SpeechWorks
Software solely in connection with use via an AOL Voice Portal by AOL Voice
Portal users.  Any grant of a license by AOL to a third party pursuant to this
Section 2.1(a)(iii) shall also be conditioned upon the following:

               (I) AOL shall require such third party to execute a license
agreement in a form consistent with the provisions of this Section 2.1(a)(iii)
to be agreed upon by AOL and SpeechWorks within thirty (30) days after the
Effective Date with respect to which SpeechWorks shall be an express third-party
beneficiary and licensor to such third party;

               (II) AOL shall provide to SpeechWorks a copy of such executed
license that shall include, without limitation, the number of ports licensed,
the location at which such third party plans to install the SpeechWorks Software
and a reasonably detailed description of the use of the SpeechWorks Software;
and

               (III) within five (5) business days of the receipt by SpeechWorks
of a copy of such executed license agreement, SpeechWorks shall provide to such
third-party a specifically identifiable copy of the Licensed Software.

          In addition to any license granted to a third party pursuant to this
Section 2.1(a)(iii) SpeechWorks authorizes AOL, in AOL's discretion, to offer to
such third party the opportunity to execute with SpeechWorks a [     ] fee-based
license to the SpeechWorks Software (the "Third Party License") at a discount
equal to [     ] percent ([     ]%) off of the [     ] list price then charged
generally by SpeechWorks to third party licensees.  In the event that such
third-party agrees to execute a Third Party

                                      -4-
<PAGE>

License, SpeechWorks shall pay to AOL an amount equal to [ ] percent ([ ]%) of
the [ ] list price then charged generally by SpeechWorks upon receipt by
SpeechWorks of the third party license fee.

          (iv) A voice portal associated with the [     ] service and operated
by AOL, although outside the scope of the grant of license to the SpeechWorks
Software in Section 2.1(a)(i) above, shall be included therein for purposes of
this Agreement.  In addition, in the event that AOL or an AOL Affiliate operates
a voice portal which does not otherwise fall under the grant of license to the
SpeechWorks Software under this Agreement, but which AOL demonstrates (x) is
operated by AOL or an AOL Affiliate as part of a larger strategic relationship
with the party for which such portal is operated and (y) is not otherwise
operated as part of an ASP or similar business strategy being implemented by
AOL, then AOL may request to SpeechWorks that such voice portal come under the
scope of the grant of license hereunder and SpeechWorks will reasonably consider
such request.  In the event that SpeechWorks determines that such voice portal
shall not fall under the scope of the grant of license hereunder, then AOL shall
be permitted to license the SpeechWorks Software from SpeechWorks for such
portal on [     ] per port pricing terms.

     (b) During the [     ] Period, [     ] Recognition Ports and System Seats
which may be used by  the permitted users specified in Section 2.1(a) [     ]
but (other than those already reported under the license in Section
2.1(a)(iii)(I)) shall be reported to SpeechWorks promptly on an Installation
Report; provided, however, that after the end of the [     ] Period, [     ]
Recognition Ports and System Seats that may be used by the permitted users
specified in Section 2.1(a) [     ] of Recognition Ports and System Seats
deployed immediately prior to the end of the Deployment Period, plus the
additional Recognition Ports and System Seats licensed under Section 2.7, if
any.

     (c)  AOL and the other permitted users specified in Section 2.1(a), [
], shall also be permitted to use (i) any currently available Rich Voice Content
listed on Exhibit A; (ii) any standard updates made available during the Term to
such Rich Voice Content listed on Exhibit A; and (iii) any other Rich Voice
Content not listed on Exhibit A but generally made available by SpeechWorks to
third-parties for no incremental cost, in each case only in connection with the
AOL Voice Portal and only to the extent such permitted users are entitled to use
the Licensed Software.  The use of all other Rich Voice Content not listed on
Exhibit A shall be subject to written terms and conditions to be mutually agreed
to by the parties; provided, however, that with respect to such Rich Voice
Content, AOL shall receive the [     ] then [     ] SpeechWorks customer for
such content.

     (d)  AOL, the AOL Affiliates and the other permitted users specified in
Section 2.1(a) obtain no rights in the Licensed Software pursuant to this
Agreement except the rights expressly granted hereunder.  Without limiting the
foregoing, the scope of the rights and licenses granted hereunder excludes (i)
all [     ], [     ] and [     ] service applications not used exclusively in
connection with the AOL Voice Portal, (ii) all [     ] and [     ] not [     ]
to an AOL Voice Portal, and (iii) all [     ] applications (including but not
limited to [     ], [     ], [     ] (i.e., [     ]), [     ], [     ] product,
and the like) not including any AOL [     ] portal or any other business
oriented content for which the target audience is either a [     ] or [     ]
users.  If AOL elects to extend the scope of the rights and licenses granted in
Section 2.1 to include any applications described in this Section 2.1(d), AOL
shall [     ] the then-current Version of the SpeechWorks Software to [     ] to
AOL.

2.2 Documentation License. Subject to the terms, conditions and restrictions set
forth in this Agreement, SpeechWorks hereby grants to each permitted user
specified in Section 2.1(a) a non-exclusive license, to use the Documentation,
and the Custom Software Documentation and to copy the Documentation and the
Custom Software Documentation only as necessary to enjoy the rights and licenses
granted to such permitted user under Section 2.1.

                                      -5-
<PAGE>

2.3 Copies. AOL and each AOL Affiliate may make a reasonable number of copies of
the SpeechWorks Software for its internal back-up and archival purposes only,
provided that all such copies shall bear the original and unmodified copyright,
patent and other intellectual property markings as originally delivered by
SpeechWorks.

2.4 Restrictions; Acknowledgement of Proprietary Rights. AOL acknowledges that
SpeechWorks retains all right, title and interest in and to the original, and
any copies, of the SpeechWorks Software and Documentation, and all patent,
copyright, trade secret, trademarks and other intellectual property rights
pertaining thereto, shall be and remain the sole property of SpeechWorks. AOL
shall not be an owner of any copies of, or have any interest in, the SpeechWorks
Software or Documentation, but rather, is licensed, pursuant to and subject to
the limitations in this Agreement, to use such copies. Without limiting the
generality of the foregoing, AOL receives no rights and agrees that it will not
itself, or through any parent, subsidiary, Affiliate, agent or other third
party: (a) modify, port, translate, localize, or create derivative works of the
SpeechWorks Software or upon any Confidential Information of SpeechWorks; (b)
decompile, disassemble, reverse engineer or attempt to reconstruct, identify or
discover any SpeechWorks Software Source Code, underlying ideas, underlying user
interface techniques or algorithms of the SpeechWorks Software by any means
whatsoever, or disclose any of the foregoing; (c) sell, lease, license,
sublicense, copy, market or distribute the SpeechWorks Software (except as
expressly permitted in this Agreement); (d) encumber or suffer to exist any lien
or security interest on any SpeechWorks Software; (e) knowingly take any action
that would cause any SpeechWorks Software or the Source Code thereof to be
placed in the public domain; or (f) use the SpeechWorks Software in any computer
environment not specified in Exhibit A. The parties respective intellectual
property rights with respect to the Custom Software and Custom Software
Documentation shall be governed by Section 6 of Exhibit C.

2.5 Trademarks. (a) AOL acknowledges that SpeechWorks owns, and shall continue
to own, all right, title and interest in its trademarks, including but not
limited to "SpeechWorks DialogModules", "SpeechSite", "SpeechWorks",
"SpeechWorks Here", "SMARTRecognizer", "SpeechSpot", "Speech Media Alliance",
"SpeechWorks SpeechLinks", SpeechWorks' logos and the percolation noise that is
or will be part of the Licensed Software and AOL agrees that it will do nothing
inconsistent with such ownership.

     (b)  AOL hereby grants to SpeechWorks a royalty-free, nonexclusive license
to use the AOL trademarks which may from time to time be used in connection with
an AOL Voice Portal ("AOL Marks") during the Term solely in connection with the
branding, labeling, promotion, advertising and marketing activities set forth in
this Agreement.  All such use shall be strictly in accordance with AOL's
standard trademark usage guidelines as provided to SpeechWorks, as same may be
modified or amended by AOL and delivered to SpeechWorks from time to time.

     (c)  SpeechWorks acknowledges and agrees that AOL is the sole owner of the
AOL Marks and that SpeechWorks' right to use the AOL Marks is derived solely
from the license thereto granted by this Agreement.  SpeechWorks acknowledges
and agrees that all its use of the AOL Marks and any goodwill established
thereby shall inure to AOL's exclusive benefit.

2.6 Audit Rights. Upon at least thirty (30) days written notice from
SpeechWorks, and not more than one (1) time per calendar year, AOL shall provide
SpeechWorks with such information and certifications regarding its systems, and
its Affiliates' systems (including but not limited to a list of servers on which
the Licensed Software is installed, the number of Recognition Ports in use by
AOL and its Affiliates, and pertinent traffic data), as may reasonably be
requested by SpeechWorks to verify compliance with the restrictions on the use
of the Licensed Software, Documentation and Custom Software Documentation.

                                      -6-
<PAGE>

2.7 Additional Recognition Ports and System Seats. Following the expiration of
the Deployment Period, AOL may request to install additional Recognition Ports
and System Seats by means of an order in the form attached hereto as Exhibit B.
Provided that the terms and conditions on the order form as completed by AOL are
commercially reasonable, SpeechWorks shall accept such order upon payment of the
applicable fees set forth in Section 11.1 by AOL.

2.8 Delivery. SpeechWorks shall, upon five (5) business days prior written
notice, install the initial copy of SpeechWorks Software at such AOL facility as
AOL may designate in such written notice. If requested by AOL, SpeechWorks shall
deliver the SpeechWorks Software to AOL in electronic form.

SECTION 3 -- PROFESSIONAL AND TRANSITION SERVICES

3.1  Professional Services.  (a) Subject to the terms and conditions of this
Agreement, AOL in its discretion agrees to retain SpeechWorks, and SpeechWorks
agrees to provide professional services to AOL, including the development of
Custom Software, in accordance with the additional terms and conditions set
forth in Exhibit C.  The Statement of Work attached as Annex 1 to Exhibit C sets
forth the parties' respective obligations in connection with [     ] of the AOL
Voice Portal project.  Subject to mutual agreement to any separate Statement of
Work in accordance with Exhibit C, SpeechWorks and AOL presently anticipate that
SpeechWorks will provide additional development services to AOL in connection
with [     ] of the AOL Voice Portal project, on a [     ] to be specified in
such separate Statement of Work.

3.2  Transition Services. SpeechWorks will provide all reasonably necessary
transition services requested by AOL, for a period of no more than [     ]
following termination of this Agreement, on a time and materials basis at its
then-current rates in accordance with the applicable provisions of Exhibit C.

SECTION 4 -- MAINTENANCE AND SUPPORT SERVICES

     Subject to the terms and conditions of this Agreement, SpeechWorks agrees
to provide maintenance and support services for the SpeechWorks Software to AOL
in accordance with the additional terms and conditions set forth in Exhibit D.

                                      -7-
<PAGE>

SECTION 5 -- ADDITIONAL OBLIGATIONS OF SPEECHWORKS

5.1  AOL Branded Content. In the event that SpeechWorks during the Term,
determines to bundle with the SpeechWorks Software any content or functionality
or otherwise provide content to licensees of the SpeechWorks Software
(collectively, "Proposed New Content"), then SpeechWorks shall provide AOL with
written notice of such determination, which notice shall contain a reasonably
detailed description of such Proposed New Content.  In the event AOL has such
[   ] or [   ], or [   ] such [   ]  within [   ] of [   ] of [   ] then, [   ]
(such [   ] to [   ] ([  ]) days of [   ]), SpeechWorks shall use such content
as the default content available to licensees of the SpeechWorks Software.
In connection with the foregoing and in partial consideration of the warrants
to be issued pursuant to the Common Stock and Warrant Purchase Agreement
referenced in Section 7, SpeechWorks and AOL shall [  ] for any AOL Branded
Content or such other content that AOL is able to  obtain that is bundled with
the SpeechWorks Software. In addition, AOL shall permit SpeechWorks to retain
that percentage of revenues generated via the sale or license of AOL Branded
Content pursuant to this Section 5.1.  In the first year following the date
when SpeechWorks begins selling or licensing AOL Branded Content, the amount
paid by SpeechWorks to AOL shall equal [     ]  percent ([  ]%) of the gross
revenue received by SpeechWorks in connection with AOL Branded Content
(and [    ] [     ] percent ([     ]%) of such [     ]). In each subsequent
year, the percentages of such gross revenue to be paid to AOL, and retained by
SpeechWorks, shall be increased or decreased based on the amount of such gross
revenue received by SpeechWorks in the prior year, as follows:

<TABLE>
<CAPTION>
   Prior Year's Gross                 Adjustment to Percentage        Corresponding Adjustment to
       Revenues                       Retained by SpeechWorks           Percentage Paid to AOL
       --------                       -----------------------         ---------------------------
<S>                                 <C>                              <C>

   Less than $[     ]                 Decreased by [     ] percent    Increased by [     ] percent
                                      ([     ]%) off the percentage   ([     ]%) over the
                                      retained in the prior year.     percentage paid in the prior
                                                                      year.

   $[     ] to $[     ]               Decreased by [     ] percent    Increased by [     ] percent
                                      ([     ]%) off the percentage   ([     ]%) over the
                                      retained in the prior year.     percentage paid in the prior
                                                                      year.

   $[     ] to $[     ]               [     ]                         [     ]

   $[     ] and greater               [     ] by [     ] percent      [     ] by [     ] percent
                                      ([    ]%) off the percentage    ([     ]%) over the
                                      retained in the prior year.     percentage paid in the prior
                                                                      year.
</TABLE>

In no event shall the percentage of such gross revenue to be retained by
SpeechWorks exceed [    ] percent ([  ]%), or be less than [  ] percent ([  ]%).

For example, if in the first year the gross revenue received by SpeechWorks in
connection with AOL Branded Content is $[    ], then the percentage retained by
SpeechWorks in the second year shall be [    ]%. If such gross revenue in the
second year is $[     ], then the percentage retained by SpeechWorks in the
third year shall be [     ]%.  If such gross revenue in each of the third,
fourth, fifth and sixth years is $[     ], then the percentage retained by
SpeechWorks in the fourth, fifth, sixth and seventh years, respectively shall be
[    ]%, [    ]%, [    ]% and [    ]%.

                                      -8-
<PAGE>

Within thirty (30) days after the end of each calendar quarter, SpeechWorks
shall provide AOL with a final statement, certified by a financial officer of
SpeechWorks, of the revenue received by SpeechWorks during the prior calendar
quarter from resales of AOL Branded Content, and data supporting SpeechWorks'
calculation of the amount due to AOL thereon, together with a remittance of any
such amount due to AOL.

As to any AOL Branded Content, AOL shall not, and shall not permit any AOL
Affiliate to, permit [     ]. or any successor thereto to sell such AOL Branded
Content as a bundled element of speech recognition software for a period of [
] ([     ]) [     ] after the earlier to occur of (i) the date that is [     ]
([     ]) days after the Effective Date and (ii) the date of the commercial
launch of an AOL Voice Portal. SpeechWorks shall not be required to resell any
AOL Branded Content that does not maintain performance/functionality that is
competitive with comparable offerings.  In addition, notwithstanding the
foregoing, nothing in this Section 5.1 shall prevent SpeechWorks from offering
non-AOL content to its customers or other third parties that request it.  AOL
may terminate SpeechWorks' right and obligation to resell AOL Branded Content if
the SpeechWorks Software materially underperforms competitors in terms of
features, accuracy, response time and efficiency. AOL shall discuss with
SpeechWorks in good faith opportunities for the offering by SpeechWorks of
particular AOL Branded Content.

5.2 Open Architecture. An objective of both parties is to create and maintain an
open speech internet architecture (i.e., without limitation, a speech internet
architecture that permits and is open to plug-ins, advanced program interfaces
and third party voice and speech internet applications). To the extent
reasonably practical and consistent with industry developments, SpeechWorks will
endeavor to keep the SpeechWorks Software platform open to third parties and
compatible with third party voice recognition systems and portals. AOL and
SpeechWorks also agree to work together to define and promote standards for the
open speech Internet.

5.3 Additional Languages.  SpeechWorks will offer to AOL additional language
versions (i.e., other than American English) of the SpeechWorks Software, when
and if available, to allow the AOL Voice Portal to be deployed in other
languages.  Subject to resource availability and upon reasonable notice, such
additional languages will be provided to AOL at [     ] of (a) a [     ]
additional payment of $[     ] per language or (b) if such language has been
previously licensed, [     ] the then-current version of such language.
Delivery of such additional software will not be considered essential elements
to the functionality of the AOL Voice Portal licenses or related professional
services.  If SpeechWorks elects to make available additional language versions
of SpeechWorks Software, AOL shall [     ] customer [     ] in terms of [     ]
and [     ] with regard to this Section 5.3.

5.4  Other Software.  During the Term, AOL shall be permitted to purchase or
license from SpeechWorks [     ] SpeechWorks [     ] third-party purchasers or
licensees, any and all software for [     ], [     ], or [     ] software that
is relevant to a [     ] or [     ], that SpeechWorks makes generally available
to third parties.

                                      -9-
<PAGE>

Section 6 -- CONSIDERATION

6.1  Initial License Fee    . In consideration of the rights and licenses
granted in Section 2 in respect of the initial [     ] Period and the rights and
licenses granted in Section 2 that survive the end of the initial [     ] Period
(as provided in Section 2.1(b)), AOL shall pay to SpeechWorks a license fee of
$[     ] as follows provided, however, that if SpeechWorks at any time during
the Term in any way [     ] in such a manner that such license could reasonably
be [     ] (e.g., [     ]), AOL shall be required to pay [     ] of (i) the fees
outlined below; and (ii) an amount equal to the [     ] of (x) the [     ] AOL;
and (y) the [     ] the SpeechWorks Software.

<TABLE>
<CAPTION>
     <S>  <C>                                                           <C>
     (a)   Within ten business (10) days after the Effective Date         $[     ]
     (b)   Immediately prior to [    ] (i) the [    ] of the Effective    $[     ]
           Date (if SpeechWorks has performed its obligations under
           Annex 1 to Exhibit C in all material respects), or (ii)
           [    ], or (iii) termination by AOL under Section 11.5.
     (c)   Upon the [    ] of the Effective Date (in addition to the      $[     ]
           amount specified in (b) above).
     (d)   Upon the [    ] of the Effective Date                          $[     ]
           Total:                                                         $[     ]
</TABLE>

For the purposes of this Agreement, the term "[ ]" shall mean either (a)
promotion by AOL to more than [ ] or unique (b) use by more than [   ] unique
users.

6.2  [   ] Period Extension Fees; Limit on [   ] Period Extension Fees. If AOL
elects to extend the initial [   ] Period for any or all of the [   ] additional
[   ] ([   ]) [   ] periods pursuant to Section 11.1, A shall pay Speech Works,
in advance an annual [   ] Period extension fee for each [   ]-year extension
equal to the lesser of (a) $[   ]; or (b) [   ] annual or pro-rated annual rate
at which [   ] the SpeechWorks Software permitting [   ] of Recognition Ports.
The maximum amount of fees payable by AOL under Section 6.1 and this Section
6.2, in the aggregate, shall be $[   ].

6.3  Professional Services Fees. In consideration of the services to be
performed by SpeechWorks pursuant to Section 3 of this Agreement, AOL shall pay
SpeechWorks the professional services fees as specified in Exhibit C, in
accordance with the payment terms specified in Exhibit C.

6.4  Maintenance and Support Fees. In consideration of the maintenance and
support services to be performed by SpeechWorks pursuant to Section 4 of this
Agreement, AOL shall pay SpeechWorks the maintenance and support services fees
specified in Annex 1 to Exhibit D, in accordance with the payment terms
specified in Exhibit D. The annual maintenance and support fee shall be
adjusted to reflect any increase in the amounts paid by AOL under Sections
2.1(d), 2.7, 6.1 and 6.2. Additionally, notwithstanding anything herein to the
contrary, the obligation of SpeechWorks to continue to provide Maintenance and
Support Services to AOL after any such adjustment shall be subject to payment of
a fee equal to the difference between the annual maintenance and support fee
before and after such adjustment, prorated for the remaining term of the then
current twelve (12) month term of Exhibit D, as measured from the date of such
increase.

6.5  Revenue Sharing

     (a) In partial consideration of the warrants to be issued pursuant to the
Common Stock and Warrant Purchase Agreement referenced in Section 7, at such
time as AOL Voice Portal Revenue earned by AOL exceeds $[     ] in the
aggregate, AOL shall pay SpeechWorks (i) $[     ] within 10 business days

                                      -10-
<PAGE>

of the end of the quarter in which such milestone is achieved, and (ii) payments
for new users of an AOL Voice Portal acquired after such milestone is achieved
(and on which the SpeechWorks Software is in use at the time of such user
acquisition) as follows: (A) $[ ] per new Registered User who has logged onto an
AOL Voice Portal where access to such portal is limited to users of an AOL or
AOL Affiliate subscription based ISP service; (B) $[ ] per new Registered User
who has logged onto an AOL Voice Portal either (1) using a unique identifier and
password received through an AOL channel (or other log-on mechanism) which by
its nature identifies such user as a member of an AOL or AOL Affiliate
subscription based ISP service, or (2) using a unique identifier and password
received in connection with the registration process at an AOL Voice Portal (or
other log-on mechanism), and, in either case, where logging onto an AOL Voice
Portal using a unique identifier and password described in (1) or (2) gives the
Registered User access to an AOL Voice Portal (or a portion thereof) that is
available only to members of an AOL or AOL Affiliate subscription based ISP
service ("Additional Access"); (C) $[ ] per new Registered User who has logged
onto an AOL Voice Portal using a unique identifier and password that does not
give the Registered User Additional Access; and (D) $[ ] per new unique user of
an AOL Voice Portal where no registration is required and where such user is
reasonably identifiable as a unique new user; provided, however, that (Y) a user
of an AOL Voice Portal will only be counted as a new user under (A), (B), (C) or
(D) above for the purposes of one AOL Voice Portal, and (Z) amounts payable by
AOL to SpeechWorks under this paragraph above shall in no event exceed a total
of $[ ] in the aggregate (except for additional amounts as may be provided for
in the next paragraph below).

     (b) At such time as AOL Voice Portal Revenue earned by AOL exceeds $[   ],
AOL shall pay SpeechWorks for new users of an AOL Voice Portal acquired after
such milestone is reached (and on which the SpeechWorks Software is in use at
the time of such user acquisition) as follows: (i) $[     ] per new Registered
User who has logged onto an AOL Voice Portal where access to such portal is
limited to users of an AOL or AOL Affiliate subscription based ISP service; (ii)
$[     ] per new Registered User who has logged onto an AOL Voice Portal either
(A) using a unique identifier and password received through an AOL channel (or
other log-on mechanism) which by its nature identifies such user as a member of
an AOL or AOL Affiliate subscription based ISP service, or (B) using a unique
identifier and password received in connection with the registration process at
an AOL Voice Portal (or other log-on mechanism), and, in either case, where
logging onto an AOL Voice Portal using a unique identifier and password
described in (A) or (B) gives the Registered User Additional Access; (iii) $[
] per new Registered User who has logged onto an AOL Voice Portal using a unique
identifier and password that does not give the Registered User Additional
Access; and (iv) $[     ] per new unique user of an AOL Voice Portal where no
registration is required and where such user is reasonably identifiable as a
unique new user; provided, however, that (Y) a user of an AOL Voice Portal will
only be counted as a new user under (i), (ii), (iii) or (iv) above for the
purposes of one AOL Voice Portal, and (Z) amounts payable by AOL to SpeechWorks
under this paragraph above shall in no event exceed a total of $[     ] in the
aggregate.

     (c) For the purposes of this Section 6.5 the term "AOL Voice Portal" shall
not include an AOL [     ] or other AOL or AOL Affiliate [     ] and/or
information service; provided, however, that if SpeechWorks provides any
substantial services under a Statement of Work hereunder (other than the
Statement of Work attached hereto as Annex 1 to Exhibit C) in connection with
AOL [     ], or other AOL or AOL Affiliate [     ] and/or information service,
then for purposes of this Section 6.5, the term "AOL Voice Portal" shall include
such service.

6.6  Payment.  Within thirty (30) days after then end of each calendar quarter,
AOL shall provide SpeechWorks with a final statement, certified by a financial
officer of AOL, of the [     ] that [     ], the Voice Portal Revenues that
were received by AOL during the prior quarter, and data supporting AOL's
calculation of the amount due to SpeechWorks for AOL [     ] during the prior
quarter, together with a remittance of any such amount due to SpeechWorks.

                                      -11-
<PAGE>

6.7  Taxes. AOL shall pay or reimburse all federal, state and local taxes
(exclusive of taxes on SpeechWorks' net income) and assessments arising on or
measured by amounts payable to SpeechWorks under this Agreement, or furnish
SpeechWorks with evidence acceptable to the taxing authority to sustain an
exemption therefrom.

6.8  Records; Audit.  AOL agrees to keep all usual and proper records and
books of account and all usual and proper entries relating to AOL Voice Portal
Revenue (including records relating to the attribution of advertising,
sponsorship, subscription and transaction revenues) and each Registered User for
a period of three (3) years after the year in which Voice Portal Revenue is
received and such Registered User first became a Registered User, respectively.
SpeechWorks agrees to keep all usual and proper records and books of account and
all usual and proper entries relating to resales of AOL Branded Content for a
period of three (3) years after revenues derived from such resales are received.
Upon written request by a party not more than once per calendar year, the other
party agrees to supply pertinent Registered User, AOL Voice Portal Revenue
(including records relating to the attribution of subscription and advertising
revenues) and other revenue data, as applicable, to the requesting party, and to
give the requesting party and its designated representatives such access to its
accounts and records as may reasonably be requested for reverification of
Registered Users and amounts paid pursuant to Section 6.5, revenues from
SpeechWorks' resales of AOL Branded Content, and amounts paid pursuant to
Section 5.1, as applicable; provided, however, that the requesting party shall
provide at least thirty (30) days' written notice and provided further that no
audits shall be permitted (i) within thirty (30) days of the end of the audited
party's fiscal quarter or (ii) within sixty (60) days of the end of the audited
party's fiscal year.  Any such audit will be paid for by the auditing party;
provided, however, that if such audit uncovers a shortfall of payments that
exceeds five percent (5%) or more of the amounts paid, the audited party shall
reimburse the auditing party for the costs of such audit.

6.9  Third Party Software License Fees. Notwithstanding anything contained
herein to the contrary, in the event that SpeechWorks is required to pay any
third party software license fees in connection with the performance by
SpeechWorks of any of its obligations hereunder, AOL agrees to pay to
SpeechWorks with respect thereto fees equal to [     ] (a) [     ] software
license fees that [     ] third party software, or (b) [     ] software license
fees for, plus [     ] costs incurred by SpeechWorks in connection with, the
applicable third party software.  Notwithstanding the foregoing, (b) above shall
not apply in situations where SpeechWorks does or provides significant
development work, or other professional services, in connection with the
applicable third party software.

SECTION 7 -- COMMON STOCK AND WARRANT PURCHASE AGREEMENT

     Simultaneously with the execution of this Agreement, the parties are also
entering into a Common Stock and Warrant Purchase Agreement, and certain related
agreements and documents, in the forms attached hereto as Exhibit E.

SECTION 8 -- CONFIDENTIAL INFORMATION

8.1  Confidential Information. A party may from time to time disclose (the
"Disclosing Party") to the other party (the "Receiving Party") certain
Confidential Information (as hereinafter defined) of the Disclosing Party.
Except as expressly permitted by this Agreement, the Receiving Party shall
protect the Confidential Information of the Disclosing Party from unauthorized
dissemination, using the same degree of care which the Receiving Party
ordinarily uses with respect to its own proprietary information, but in no event
with less than a reasonable degree of care. The Receiving Party shall not use
the Confidential Information of the Disclosing Party for any purpose not
expressly permitted by this Agreement, and shall limit the disclosure of the
Confidential Information of the Disclosing Party to the employees or agents of

                                      -12-
<PAGE>

the Receiving Party, and of the Receiving Party's Affiliates, who have a need to
know such Confidential Information for purposes of this Agreement, and who are,
with respect to the Confidential Information of the Disclosing Party, bound in
writing by confidentiality terms no less restrictive than those contained
herein.  The Receiving Party shall provide copies of such written agreements to
the Disclosing Party upon request; provided, however, that such agreement copies
shall themselves be deemed the Confidential Information of the Receiving Party.
Notwithstanding the foregoing, Confidential Information may be disclosed if such
disclosure is required by law or by the order of a court or similar judicial or
administrative body; provided, however, that the Receiving Party shall notify
the Disclosing Party of such requirement immediately and in writing, and shall
cooperate reasonably with the Disclosing Party, at the Disclosing Party's
expense, in obtaining a protective or similar order with respect thereto.

8.2 Definition of Confidential Information. For purposes of this Agreement, term
"Confidential Information" shall mean (a) the Licensed Software, in Object Code
and Source Code form, and any related technology, idea, algorithm or information
contained therein, including without limitation any trade secrets related to any
of the foregoing; (b) a party's product plans, designs, costs, prices and names;
non-published financial information, marketing plans, business opportunities,
personnel, research, development or know-how; (c) any information designated by
the Disclosing Party as confidential in writing or, if disclosed orally, the
confidential nature of which is reasonably apparent at the time of disclosure;
(d) the terms and conditions of this Agreement; and (e) with respect to AOL, any
AOL User Information; provided, however that the term "Confidential Information"
will not include information that: (i) is or becomes generally known or
available by publication, commercial use or otherwise through no fault of the
Receiving Party; (ii) is known and has been reduced to tangible form by the
Receiving Party at the time of disclosure and is not subject to restriction;
(iii) is independently developed by the Receiving Party without use of the
Disclosing Party's Confidential Information; (iv) is lawfully obtained from a
third party who has the right to make such disclosure; or (v) is released for
general publication by the Disclosing Party in writing.

8.3 Return of Confidential Information. Except with regard to the SpeechWorks
Software and Documentation, the Receiving Party shall return to the Disclosing
Party, destroy or erase, all Confidential Information of the Disclosing Party in
tangible form: (a) upon the written request of the Disclosing Party; or (b) upon
the expiration or termination of this Agreement, whichever comes first, and in
both cases, the Receiving Party shall certify promptly and in writing that it
has done so.

SECTION 9 -- WARRANTIES AND DISCLAIMER

9.1  Warranties

     (a) Subject to the limitations and exceptions set forth in this Section 9.1
and in Section 10.3, SpeechWorks warrants that, for a period of [  ] ([  ]) days
after installation of the SpeechWorks Software(the "Warranty Period"), the
SpeechWorks Software will conform in all material respects to the specifications
in the Documentation and that the media on which the software is delivered will
be free of defects.

     (b) During the Warranty Period SpeechWorks warrants that the SpeechWorks
Software, any copies thereof furnished by SpeechWorks hereunder to AOL or to any
third parties specified herein, and any computer media delivered hereunder to
AOL or any such third party shall, at the time of delivery, be free from
computer viruses and any undocumented or unauthorized methods for terminating or
disrupting the operation of, or gaining access to the AOL Technology or any
network, software, computer systems or computing resources or data of AOL or any
of its Affiliates.

                                      -13-
<PAGE>

     (c) During the Warranty Period SpeechWorks represents and warrants that the
SpeechWorks Software is designed to be used during and after the calendar year
2000 A.D.  SpeechWorks further represents and warrants that the SpeechWorks
Software shall perform fully during each time period and without error relating
to date values or other date data provided that input data is provided in
SpeechWorks approved formats, including (a) errors resulting from or related to
date data that represents or references different centuries or more than one
century, and (b) errors resulting from or related to calculations, processing,
sequencing, or employing date data.  Without limiting the generality of the
preceding sentences, SpeechWorks represents and warrants that the SpeechWorks
Software (i) is capable of accurately, correctly and consistently accepting,
calculating, comparing, sorting, and otherwise processing, returning, and
displaying date inputs and date values, regardless of when such date data are
used, the format or separators used to express such dates, and whether such
dates are read from the internal clock of the hardware, input by a user, or
otherwise, (ii) shall accurately, correctly, and consistently manage and
manipulate data involving dates, including formulas that involve dates in one
century or dates in more than one century, and (iii) shall not cause an
abnormally-ending routine or process within an application or generate incorrect
values or invalid results involving date data.

     (d) SpeechWorks represents and warrants that the SpeechWorks Software does
not contain any disabling codes, termination logic or any other means to
terminate the use thereof by AOL and its Affiliates or to otherwise disrupt or
electronically repossess the SpeechWorks Software.

     (e) SpeechWorks represents and warrants that: (i) it has the full corporate
right, power and authority to enter into this Agreement; (ii) the execution of
this Agreement and performance of its duties and obligations hereunder do not
and will not violate any agreement to which SpeechWorks is a party or by which
it is otherwise bound; and (iii) when executed and delivered by SpeechWorks,
this Agreement will constitute the legal, valid and binding obligation of
SpeechWorks, enforceable against it in accordance with its terms.

     (f) AOL represents and warrants that: (i) it has the full corporate right,
power and authority to enter into this Agreement; (ii) the execution of this
Agreement and performance of its duties and obligations hereunder do not and
will not violate any agreement to which AOL is a party or by which it is
otherwise bound; and (iii) when executed and delivered by AOL, this Agreement
will constitute the legal, valid and binding obligation of AOL, enforceable
against it in accordance with its terms.

9.2 Remedies. In the event that the SpeechWorks Software fails to conform to any
of the warranties set forth in paragraphs (a), (b), (c) or (d) of Section 9.1,
AOL shall promptly notify SpeechWorks and provide SpeechWorks with all available
information in written or electronic form so that SpeechWorks can reproduce any
such nonconformity. SpeechWorks' sole obligation is to undertake commercially
reasonable efforts to correct a reproducible nonconformity so reported to
SpeechWorks during the Warranty Period. SPEECHWORKS' SOLE LIABILITY, AND AOL'S
AND AOL'S AFFILIATES' EXCLUSIVE REMEDY WITH RESPECT TO BREACH OF THE FOREGOING
LIMITED WARRANTIES, WILL BE LIMITED TO ERROR CORRECTION OR PRODUCT REPLACEMENT,
OR IF, AFTER EXPENDING REASONABLE EFFORTS FOR A PERIOD OF NOT LESS THAN SIXTY
(60) DAYS TO DO SO, NEITHER IS COMMERCIALLY FEASIBLE, THEN AOL SHALL RECEIVE A
REFUND OF THE LICENSE FEES RECEIVED BY SPEECHWORKS FROM AOL HEREUNDER FOR THE
NONCONFORMING SOFTWARE.

9.3 DISCLAIMER. THE FOREGOING PROVISIONS OF THIS SECTION 9, AND THE PROVISIONS
OF SECTIONS 7.1 AND 7.2 OF EXHIBIT C, STATE SPEECHWORKS' SOLE AND EXCLUSIVE
WARRANTY, AND ITS SOLE AND EXCLUSIVE OBLIGATION TO AOL AND AOL'S AFFILIATES FOR
BREACH OF WARRANTY. EXCEPT FOR THE EXPRESS WARRANTIES STATED IN THIS SECTION 9,
AND IN SECTION 7 OF EXHIBIT C,

                                      -14-
<PAGE>

SPEECHWORKS MAKES NO ADDITIONAL WARRANTY, EXPRESS OF IMPLIED, STATUTORY OR
OTHERWISE, AS TO ANY MATTER WHATSOEVER AND ALL WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS ARE
EXPRESSLY EXCLUDED.

9.4  LIMITATION OF LIABILITY. Except with regard to (i) any refund payable by
SpeechWorks under Section 9.2, or Section 7.2 of Exhibit C, (ii) SpeechWorks'
obligations under Section 10.1, (iii) a breach by either party of its respective
obligations under Section 8, and (iv) a breach by AOL of its obligation under
Section 2, each party's total liability to the other party and such other
party's Affiliates for any claim arising under this Agreement, or otherwise
arising from the transactions contemplated under this Agreement, regardless of
the form of action (including, but not limited to actions for breach of
contract, negligence, strict liability, rescission and breach of warranty) will
not exceed the lesser of (a) the [     ] to SpeechWorks during the [   ] ([ ])
[             ] such [            ], or (b) the actual damages sustained by
such entity or person.

9.5  NO CONSEQUENTIAL DAMAGES. EXCEPT WITH RESPECT TO A BREACH BY A PARTY OF
ITS RESPECTIVE OBLIGATIONS UNDER SECTION 8 AND EXCEPT WITH RESPECT TO ANY
AMOUNTS PAYABLE BY SPEECHWORKS TO THIRD PARTIES PURSUANT TO ITS OBLIGATIONS
UNDER SECTION 10, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY SPECIAL,
INDIRECT OR CONSEQUENTIAL DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOSS OF
REVENUES AND LOSS OF PROFITS, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.

SECTION 10 -- INFRINGEMENT MATTERS; INDEMNITIES

10.1  Indemnities.  SpeechWorks agrees, at its own expense, to defend or, at
its option, to settle, any claim or action brought against AOL to the extent it
is based on a claim that AOL's use of the Licensed Software in accordance with
the scope of this Agreement infringes or violates any United States patent,
United States copyright, trademark, trade secret or other intellectual property
right of a third party, and will indemnify and hold AOL harmless from and
against any damages, costs and fees of any kind whatsoever incurred (including
reasonable attorneys' fees) that are attributable to such claim or action.  AOL
agrees that SpeechWorks shall have the foregoing obligation only if AOL provides
SpeechWorks with: (i) prompt written notification of the claim or action; (ii)
sole control and authority over the defense or settlement thereof (and will
consult with AOL with respect thereto to the extent reasonably practicable); and
(iii) all available information, assistance and authority to settle and/or
defend any such claim or action (all at SpeechWorks' sole cost and expense).
AOL shall have the right, at its expense, to participate in any such claim
through counsel of its choice.

10.2  Limited Remedies. If any Licensed Software becomes, or in the opinion
of SpeechWorks is likely to become, the subject of an infringement claim or
action, SpeechWorks may procure, at no cost to AOL, the right to continue using
the Licensed Software. If AOL is enjoined, by order of a court or other
governmental body, from using the Licensed Software as contemplated by this
Agreement as a result of an infringement claim or action, then SpeechWorks may,
at its sole option: (i) procure, at no cost to AOL, the right to continue using
the Licensed Software; (ii) replace or modify the SpeechWorks Software to render
it noninfringing, provided there is no material loss of functionality; or (iii)
if, in SpeechWorks' reasonable opinion, neither (i) nor (ii) are commercially
feasible terminate the license and refund the amounts AOL paid for such
SpeechWorks software. Except as provided in Section 10.1, the foregoing
provisions of this Section 10.2 state SpeechWorks' sole obligation and AOL's
exclusive remedy in the event any such claim.

                                      -15-
<PAGE>

10.3 Limitation of Liability; Additional Indemnities. SpeechWorks will have no
liability under this Section 10 or the limited warranty provided for in Section
9.1, or Section 7.1 of Exhibit C, for any claim or action where: (i) such claim
or action would have been avoided but for modifications of the Licensed
Software, or portions thereof, made by any party other than SpeechWorks (or any
third party retained by SpeechWorks pursuant to Section 3.3 of Exhibit C) after
delivery to AOL; (ii) such claim or action would have been avoided but for the
combination or use of the Licensed Software, or portions thereof, with other
products, processes or materials (including but not limited to the AOL
Technology) not otherwise recommended by SpeechWorks; (iii) after AOL is
enjoined from using the Licensed Software, AOL continues allegedly infringing
activities after being notified thereof (provided that AOL shall also indemnify
SpeechWorks against liabilities incurred by SpeechWorks as a result of AOL
continuing to engage in allegedly infringing activities after being notified
thereof, but prior to being enjoined from using the Licensed Software); (iv) AOL
continues allegedly infringing activities after being informed of modifications
that would have avoided the alleged infringement, provided that there is not
material loss of functionality; (v) AOL's use of the Licensed Software is not
strictly in accordance with the terms of this Agreement; or (vi) except to the
extent that AOL purchases maintenance and support services for such Custom
Software, such claim or action arises directly out of any portion of the Custom
Software created solely for the purpose of allowing the Licensed Software to
function in conjunction with an AOL Voice Portal or otherwise created pursuant
to detailed technical specifications provided to SpeechWorks by AOL. AOL agrees
to indemnify and hold SpeechWorks harmless from and against all losses, damages
and expenses, including reasonable attorney's fees, in connection with any
claims brought against SpeechWorks and its officers, employees, agents or
subcontractors arising as a result of any of the conditions described in clauses
(i) through (iv) above. SpeechWorks agrees that AOL shall be released from the
foregoing obligation unless SpeechWorks provides AOL with: (i) prompt written
notification of the claim or action; (ii) sole control and authority over the
defense or settlement thereof; and (iii) all available information, assistance
and authority to settle and/or defend any such claim or action.

SECTION 11 -- DEPLOYMENT PERIOD; TERM; TERMINATION

11.1  Initial Deployment Period; Optional Extension; Automatic Extension. The
initial period during which AOL may deploy an unlimited number of Recognition
Ports (as described in Section 2.1(b)) shall commence on the Effective Date and
continue for three (3) years thereafter; provided, however, that AOL may extend
such initial 3-year unlimited deployment period for up to an additional three 1-
year periods by written notice to SpeechWorks, and payment of the extension fees
specified in Section 6.2 above, at any time prior to the end of the then current
unlimited deployment period.  The initial 3-year unlimited deployment period and
each [     ]-year extension thereof are collectively referred to in this
Agreement as the "[     ] Period." When AOL has paid fees under Section 6.1 and
Section 6.2 of $[     ] in the aggregate, the Deployment Period shall
automatically be extended for an indefinite period of time until terminated
pursuant to Section 11.3, 11.4, 11.5 or 13.2; provided, however, that if the
amount of fees paid by AOL under Section 6.1 and Section 6.2 immediately prior
to the end of the Deployment Period (the "Actual Fees Paid") is less than $[
], AOL shall in its discretion be permitted to pay to SpeechWorks the difference
between $[     ] and the Actual Fees Paid and thereby be deemed to have paid $[
] for purposes of this Section 11.1.  Notwithstanding the foregoing, the
Deployment Period shall terminate automatically upon any termination or
expiration of this Agreement unless AOL has paid fees under Section 6.1 and
Section 6.2 of $[     ] in the aggregate prior to the end of the Term; provided,
however, that except in the case of a termination by SpeechWorks under Section
11.3 or by AOL under Section 11.5, AOL shall thereafter be permitted for a
period of twenty-four (24) months (i) to deploy Recognition Ports [     ] the
SpeechWorks [     ]  [     ]; and (ii) to [      ]  maintenance and support
services pursuant to [     ] maintenance and support service fee schedule at
which SpeechWorks [     ].

                                      -16-
<PAGE>

11.2  Term. The term of this Agreement (the "Term") shall commence on the
Effective Date and shall continue thereafter until terminated in accordance with
Section 11.3, 11.4, 11.5 or 13.2.

11.3  Termination By Either Party. Either party may terminate this Agreement
immediately upon giving notice in writing to the other party if such other party
commits a material breach of this Agreement and shall have failed to cure such
breach within thirty (30) days of receipt of a request in writing from the
notifying party to do so; provided, however, that a breach by SpeechWorks of its
obligations under Section 9 shall not be deemed to be a material breach but
instead shall be subject to the exclusive remedies set forth in Section 10.2.
The parties acknowledge that the failure to pay to SpeechWorks any material
amount when due hereunder shall constitute a material breach.  Notwithstanding
the foregoing, SpeechWorks shall have the right to terminate this Agreement
immediately upon the breach by AOL of any material term of Section 2.  Upon
termination by AOL under this Section 11.3, notwithstanding anything in this
Agreement to the contrary, (a) without AOL being obligated to pay any license
fees after the date of such Termination (other than unpaid license fees that had
become due prior to the date of the Termination), the number of Recognition
Ports and System Seats which may be used by the permitted users specified in
Section 2.1(a)(i) and (ii), and the time period during which AOL may deploy such
Recognition Ports and System Seats, shall not be limited but shall be reported
to SpeechWorks promptly on an Installation Report, and (b) SpeechWorks shall
continue to provide Maintenance and Support Services, upon payment therefor, in
accordance with this Agreement, including but not limited to Annex 1 of Exhibit
D hereto, until the later of (i) the date two years after the effective date of
termination or (ii) the sixth anniversary of the Effective Date.

11.4  Termination for Bankruptcy/Insolvency or Changes in Business.  Either
Party may terminate this Agreement immediately following written notice to the
other Party if the other Party (i) ceases to do business in the normal course,
(ii) becomes or is declared insolvent or bankrupt, (iii) is the subject of any
proceeding related to its liquidation or insolvency (whether voluntary or
involuntary) which is not dismissed within ninety (90) calendar days or
(iv) makes an assignment for the benefit of creditors.

11.5  TERMINATION BY AOL

     (a) AOL may terminate this Agreement upon written notice given to
SpeechWorks if SpeechWorks does not, on or before the tenth (10th) business day
following the Effective Date, (i) satisfy the conditions set forth in Sections
6(b)(iii), 6(b)(v) and 6(b)(vi) of the Common Stock and Warrant Purchase
Agreement referenced in Section 7; and (ii) issue the warrant to AOL as required
by Section 1(b) such Common Stock and Warrant Purchase Agreement.

     (b)  AOL may also terminate this Agreement at [     ] ([     ]) [     ]
[         ]. The foregoing termination shall be effective immediately prior to
the first anniversary of the Effective Date that follows SpeechWorks' receipt of
such termination notice, unless SpeechWorks receives the termination notice less
than thirty (30) days prior to the next anniversary of the Effective Date in
which case the termination shall be effective immediately prior to the second
anniversary of the Effective Date that follows SpeechWorks' receipt of such
termination notice. Notwithstanding the foregoing, AOL shall still be obligated
to pay the license fee specified in Section 6.1(b) if AOL terminates this
Agreement pursuant to this Section 11.5 prior to the first anniversary of the
Effective Date.

11.6 Effect of Termination. Immediately upon the termination of this
Agreement (whether pursuant to this Section 11 or for any other reason):
(a) except for the rights, licenses and obligations that by the express terms of
this Agreement are to survive the termination of this Agreement, all rights,
licenses and obligations of the parties under this Agreement shall immediately
terminate; and (b) any outstanding amounts due to either party hereunder shall
immediately become due and payable. Without limiting the generality of the
foregoing, the rights of AOL and any AOL Affiliate or third party specified in
Section 2 to use the Licensed Software as set forth herein shall survive the
termination of this Agreement unless this Agreement has been terminated by
SpeechWorks as a result of (x) AOL's breach of the scope of the license set
forth in Section 2, (y) AOL's failure to pay any license fees hereunder when due
or within the applicable cure period, or (z) any material breach by AOL of
Section 8, or of Section 6 of Exhibit C or Section 6 of Exhibit D; in which case
all rights and licenses granted hereunder with respect to the Licensed Software,
Documentation and Custom Software Documentation shall immediately terminate and,
upon request by SpeechWorks, any person or entity that had been using Licensed
Software pursuant to a license granted hereunder shall certify in writing to
SpeechWorks its non-use, deletion and/or destruction of the Licensed Software,
Documentation and Custom Documentation.

11.7 Survival. Notwithstanding anything to the contrary in this Section 11, the
provisions of Sections 6.3, 6.4, 6.5 through 6.9, 8, 9, 11, 14, 15.4, 15.6,
15.9, 15.10 and 15.11 shall survive termination of this Agreement.

SECTION 12--SOURCE CODE ESCROW

     Within thirty (30) days after the Effective Date, SpeechWorks and AOL shall
execute a source code escrow and license agreement substantially in the form of
Exhibit F with appropriate modifications to conform to the terms of this
Agreement (the "Escrow Agreement"). Each time SpeechWorks delivers a copy of
SpeechWorks Software or an Update or Version hereunder, SpeechWorks shall, at
its expense, place a copy of the Source Code of the SpeechWorks Software, Update
or Version into escrow. Without limiting the provisions of the Escrow Agreement,
and in addition to the Release Conditions (as defined in such Escrow Agreement),
in the event of a Trigger Event (hereinafter defined) where SpeechWorks is the
acquired party and the Acquiring Entity (hereinafter defined) is a Specified AOL
Competitor, the Source Code will be released to AOL and AOL shall be entitled to
exercise the license to such Source Code specified in the Escrow Agreement.
AOL's right to receive Source Code is at all times subject to Section 13.3
below.

SECTION 13--ASSIGNMENT AND CHANGE OF CONTROL

13.1 Assignment. Except as expressly permitted herein, neither party may assign,
transfer or pledge this Agreement, or any interest, license, or rights of any
kind herein, in any manner, without the prior written consent of the other party
to this Agreement, except (a) in the case of SpeechWorks, in connection with a
merger, reorganization or sale of substantially all of the business of
SpeechWorks, or, (b) in the case of AOL, (i) in connection with a merger,
reorganization or sale of substantially all of the business relating to the AOL
Voice Portal, or (ii) any assignment predicated upon the merger of AOL and Time
Warner, Inc. Any purported assignment, transfer or pledge of this Agreement in
violation of this Section 13 shall be null and void. Any permitted assignment,
transfer or pledge of this Agreement shall be subject to Section 13.2.

13.2 Mergers, Acquisition of Assets or Change of Control.

     (a)  (i)  If SpeechWorks consummates any permitted transaction or series of
transactions under which an entity (the "Acquiring Entity") would acquire,
whether by merger or otherwise, (A) substantially all of the business of
SpeechWorks or (B) beneficial ownership or control, directly or indirectly, of
more than fifty percent (50%) of the outstanding shares or securities
representing the right to vote for the election of directors of SpeechWorks
(each a "Trigger Event"), this Section 13.2 shall apply.

          (ii) Upon a Trigger Event in which the Acquiring Entity is a Specified
AOL Competitor or upon a Trigger Event after which SpeechWorks announces that it
is shutting down or migrating from

                                      -17-
<PAGE>

the current Speechworks platform to a different speech recognition platform
(e.g. the Nuance platform, a different proprietary platform, or to any other
speech recognition platform) or de facto shuts down or migrates away such
platform (e.g. by no longer providing a similar level and quality of licensing
and/or support services to third party licensees of such platform or similar
indicia), then: (A) AOL shall be entitled, at its option, to terminate this
Agreement upon thirty (30) days' written notice, (B) without AOL being obligated
to pay any license fees after the date of the Trigger Event (other than unpaid
license fees that had become due prior to the date of the Trigger Event), the
number of Recognition Ports and System Seats which may be used by the permitted
users specified in Section 2.1(a)(i) and (ii), and the time period during which
AOL may deploy such Recognition Ports and System Seats, shall not be limited but
shall be reported to SpeechWorks promptly on an Installation Report, (C) the
Acquiring Entity shall agree in writing to provide Maintenance and Support
Services, upon payment therefor, in accordance with this Agreement, including
but not limited to Annex 1 of Exhibit D, until the later of (1) the date two
years after the date of the Trigger Event or (2) the sixth anniversary of the
Effective Date, (D) on or prior to the date which is within 60 days of such
termination SpeechWorks will refund to AOL all licensing fees paid by AOL to
SpeechWorks under this Agreement up to the date of such termination, and (E) at
AOL's option SpeechWorks shall provide AOL with the services, for one full year
after such termination, of the equivalent of five full time SpeechWorks
engineers or similar SpeechWorks consultants qualified to work with AOL to
effect a transition of the AOL Voice Portals away from the SpeechWorks platform
and on to an alternate platform chosen by AOL. In the event of any Trigger
Event, prior to consummating such transaction or series of transactions, if this
Agreement is not terminated in accordance with (A) above, the Acquiring Entity
shall agree in writing to be bound by the terms and conditions of this
Agreement.

          (iii) Upon aTrigger Event in which the Acquiring Entity is a Specified
SpeechWorks Competitor or upon a Trigger Event after which Speechworks announces
that it is shutting down or migrating from the current Speechworks platform to a
different speech recognition platform (e.g. the Nuance Platform, a different
proprietary platform, or to any other speech recognition platform) or de facto
shuts down or migrates away such platform (e.g. by no longer providing a similar
level and quality of licensing and/or support services to third party licensees
of such platform or similar indicia) (A) notwithstanding anything in Section 3.1
of Exhibit D to the contrary, SpeechWorks shall provide support for the then
current production Version of the Licensed Software in accordance with Exhibit D
and shall support the immediately prior release for a period of three (3) years
after the release of the then current production Version, (B) upon a migration
by the Acquiring Entity off of the SpeechWorks platform, without AOL being
obligated to pay any license fees after such migration (other than unpaid
license fees that had become due prior to such migration), the number of
Recognition Ports and System Seats which may be used by the permitted users
specified in Section 2.1(a)(i) and (ii), and the time period during which AOL
may deploy such Recognition Ports and System Seats, shall not be limited but
shall be reported to SpeechWorks promptly on an Installation Report, and (C) the
Acquiring Entity shall agree in writing to provide Maintenance and Support
Services, upon payment therefor, in accordance with this Agreement, including
but not limited to Annex 1 of Exhibit D, until the later of (1) the date two
years after the date of the Trigger Event or (2) the sixth anniversary of the
Effective Date.

     (b) If prior to a firm commitment underwritten public offering by
SpeechWorks pursuant to an effective registration statement filed under the
Securities Act of 1933, as amended, in which shares of the common stock of
SpeechWorks are approved for listing on a national securities market, either (i)
SpeechWorks receives a bona fide offer from a third party to affect a Trigger
Event; or (ii) SpeechWorks determines to seek an offer from any third party to
affect a Trigger Event, then in either such event SpeechWorks shall before
executing any binding documentation with respect thereto other than a
nondisclosure agreement, but including but not limited to a "standstill"
provision, provide to AOL written notice of the receipt of such offer or its
determination to seek such offers, together with description of the material
terms (including but not limited to price, form of consideration and type of
security) of any such offer (but excluding the identity of the third
party(ies)). For a period of ten (10) business days from such notice,
SpeechWorks will not sign a definitive agreement to engage in a Trigger Event.

                                      -18-
<PAGE>

13.3 Acquisition of Specified SpeechWorks Competitor. If at any time AOL, or
any AOL Affiliate, directly or indirectly controls, is controlled by or is under
common control with (as control is defined in the definition of Affiliate) a
Specified SpeechWorks Competitor, then AOL's right to receive Source Code under
Section 12, and Section 4.1(d) of the Escrow Agreement, shall be suspended until
such time when AOL has divested itself or otherwise disposed or ceased
operations of those business units responsible for software that is similar in
nature or functionality to the Licensed Software (and has not reacquired or
resumed such operations, in which case such rights shall again be suspended and
AOL, if it has received Source Code under the sections referenced above, shall
immediately delete, destroy or return all copies of the Source Code and related
documentation, and certify the same to SpeechWorks).

SECTION 14 -- DISPUTE RESOLUTION

14.1 Amicable Resolution. The parties shall first attempt to amicably resolve
any dispute that may arise under this Agreement. If the parties cannot resolve
the dispute within thirty (30) days, either party may refer the dispute to
arbitration pursuant to Section 14.2.

14.2 Arbitration pursuant to Section 14.1, any controversy or claim arising out
of or relating to this Agreement shall be settled by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration Association,
except that the parties shall be entitled to reasonable document and deposition
discovery from each other limited to the matters in dispute. A judgment upon the
award rendered by the arbitrator shall be final and nonappealable, and may be
entered in any court having jurisdiction thereof. The arbitration proceeding
shall be conducted by a single arbitrator knowledgeable regarding matters in the
software industry and held in Boston, Massachusetts or such other location as
the parties may mutually agree upon. Notwithstanding the foregoing, (a) AOL
recognizes and acknowledges that any use or disclosure of the Licensed Software,
Documentation, Custom Software Documentation or SpeechWorks' Confidential
Information, by AOL and (b) SpeechWorks recognizes and acknowledges that any use
or disclosure of the AOL Technology and any Confidential Information, of AOL or
its Affiliates, in either event in a manner inconsistent with the provisions of
this Agreement may cause SpeechWorks or AOL (as the case may be) irreparable
damage for which remedies other than injunctive relief may be inadequate, and
SpeechWorks or AOL (as the case may be) may therefore seek from any court of
competent jurisdiction, injunctive and other equitable relief as appropriate. If
either party seeks injunctive or other equitable relief in the event of a breach
or threatened breach of this Agreement by the other party or such other party's
Affiliates, then such other party agrees that it shall not allege in any such
proceeding that the party seeking such injunctive or equitable relief has an
adequate remedy at law. If a party seeks any equitable remedies (including
injunctive relief), it shall not be precluded or prevented from seeking remedies
at law, nor shall it be deemed to have made an election of remedies.

SECTION 15 -- GENERAL TERMS

15.1 Force Majeure. Except for the obligation to make payments, nonperformance
of either party shall be excused to the extent that performance is rendered
impossible by strike, fire, flood, governmental acts or orders or restrictions,
failure of suppliers, or any other reason where failure to perform is beyond the
reasonable control of the non-performing party.

15.2 Notices. Any required notices hereunder shall be given in writing at the
address of each party set forth above, to the persons identified for such
purpose in the Common Stock and Warrant Purchase Agreement referenced in Section
7 above, or to such other in the manner contemplated herein, and shall be deemed
served when delivered or, if delivery is not accomplished by reason or some
fault of the addressee, when tendered.

                                      -19-
<PAGE>

15.3 Relationship Between the Parties. In all matters relating to this
Agreement, AOL and SpeechWorks shall act as independent contractors. Except as
may be otherwise expressly permitted hereunder, neither party will represent
that it has any authority to assume or create any obligation, expressed or
implied, on behalf of the other party, or to represent the other party as agent,
employee, or in any other capacity.  Neither party shall have any obligation,
expressed or implied, except as expressly set forth herein.

15.4 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without giving effect to
principles of conflicts of laws.

15.5 Export Controls; Government Use.  AOL agrees and certifies that neither
the Licensed Software, nor any other technical data received from SpeechWorks,
nor the direct product thereof, will be exported or re-exported outside the
United States except as authorized and as permitted by the laws and regulations
of the United States.  Any use of the Licensed Software by the U.S. Government
is conditioned upon the Government agreeing that the Licensed Software is
subject to Restricted Rights as provided under the provisions set forth in
subdivision (c)(1)(ii) of Clause 252.227-7013 of the Defense Federal Acquisition
Regulations Supplement, or the similar acquisition regulations of other
applicable U.S. Government organizations.

15.6 Entire Agreement; Headings; Counterparts. This Agreement constitutes the
entire agreement and understanding between the parties with respect to the
subject matter hereof, and supersedes all prior agreements, arrangements and
undertakings between the parties.  No addition to or modification of any
provision of this Agreement shall be binding upon the parties unless made by a
written instrument signed by a duly authorized representative of each of the
parties.  The headings to the sections of this Agreement are for ease of
reference only and shall not affect the interpretation or construction of this
Agreement. This Agreement may be executed in counterparts, each of which shall
be deemed to be an original and all of which shall be deemed to be an original
instrument. The Exhibits are an integral part of this Agreement.

15.7 Publicity. Consistent with the applicable regulatory requirements, the
parties shall issue a mutually agreed upon joint press release, at a mutually
agreed upon time, announcing the selection of SpeechWorks and the collaboration
to launch the AOL Voice Portal and to collaborate on industry standards.  Not
withstanding the foregoing in the event that SpeechWorks, on the advice of
counsel, is required to issue a press release under applicable law or regulatory
requirement, SpeechWorks will provide reasonable notice to AOL and an
opportunity to comment on such press release.  Finally, in partial consideration
of the warrants to be issued pursuant to the Common Stock and Warrant Purchase
Agreement referenced in Section 7, the parties have agreed to additional
requirements in connection with publicity as more fully set out on Exhibit G.

15.8 Partial Invalidity; Waiver. If any provision of this Agreement or the
application thereof to any party or circumstances shall be declared void,
illegal or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the extent permitted by applicable law. In such event the parties
shall use their best efforts to replace the invalid or unenforceable provision
by a provision that, to the extent permitted by applicable law, achieves the
purposes intended under the invalid or unenforceable provision.  Any deviation
by either party from the terms and conditions with applicable laws, rules and
regulations shall not be considered a breach of this Agreement.  No failure of
either party to exercise any power or right given either party hereunder or to
insist upon strict compliance by either party with its obligations hereunder,
and no custom or practice of the parties at variance with the terms hereof shall
constitute a waiver of either party's right to demand exact compliance with the
terms hereof.

                                      -20-
<PAGE>

15.9 Non-Solicitation. During the Term and for a period of twelve (12) months
thereafter, neither party shall hire or attempt to hire any Restricted Employee
of the other party and shall not, directly or indirectly, solicit, induce, or in
any manner attempt to influence any Restricted Employee of the other Party to
terminate his or her employment with such other party, or to modify such
relationship in a manner that is adverse to the interests of such other party;
provided, however, that either party may employ any person who (a) initially
contacts a party without solicitation, directly or indirectly, by such party or
(b) responds to any general media solicitation of employment or engagement by a
party or to any solicitation or inquiry from a recruiter retained by a party
provided that such person is not specifically identified or targeted by a party
for such solicitation or inquiry.  "Restricted Employee" shall mean any person
employed by a party who is or was materially involved in the negotiation,
implementation, or administration of this Agreement and/or any activity
contemplated hereunder. Notwithstanding anything to the contrary in this
Agreement, the parties agree that in the event of a breach or threatened breach
of any covenant contained in this Section 15.9, the non-breaching party shall
have the right and remedy to have such covenant specifically enforced by any
court having competent jurisdiction, it being acknowledged and agreed by the
parties that any material breach of any covenant in this Section 15.9 will cause
irreparable injury to the other party and that money damages will not provide an
adequate remedy.

15.10 AOL Primarily Liable. AOL shall at all times be and remain primarily
liable to SpeechWorks for any and all breaches of this Agreement by any AOL
affiliate, contractor, subcontractor, or any of their respective officers,
directors, employees, contractors, subcontractors or agents.

15.11  Most Favorable.  When the terms "most favorable," "most favored," "no
less favorable" and the like are used in this Agreement to compare an
arrangement offered under this Agreement to an arrangement offered to a third
party, all salient economic terms of the two arrangements shall be considered in
making such comparison.

In Witness Whereof, the parties have caused this Agreement to be executed by
their respective duly authorized representative as an instrument under seal
effective as of the Effective Date.

AMERICA ONLINE, INC.             SPEECHWORKS INTERNATIONAL, INC.

By: /s/ Jay Rappaport            By: /s/ Stuart R. Patterson
   ------------------------        -------------------------
Name:  Jay Rappaport                Stuart R. Patterson
Title: Senior Vice President        President and Chief Executive Officer

                                      -21-
<PAGE>

                                   EXHIBIT A

                        SPEECHWORKS SOFTWARE; PRODUCTS

I.  SpeechWorks Software.
    --------------------

The software available for licensing under the terms of the Agreement to which
this Exhibit is attached is as follows:

SPEECHWORKS(R) is a solution for speech-enabling transactional applications over
the telephone. packaged as six functional components:

     1.  SpeechWorks SMARTRecognizer(TM) recognizes words or phrases from
     individual vocabularies in the call flow and provides processing of phrases
     and sentences. This engine supports a range of hardware platforms and
     scales to thousands of phone lines. Its features include:

     2.  SPEECHWORKS DIALOGMODULES(TM) are high-level building blocks
     representing frequently used caller interactions that developers can
     assemble and integrate into applications. Each DialolgModule encapsulates a
     particular task such as capturing a "yes" or "no" response or creating a
     voice menu. The DialogModules are made available in three bundles/packages.

       A.  BASE:  Includes recognition kernel, reporting tools, and the
       following DialogModules:

       AlphaNumeric String - Collects a string of connected (pauses are not
       required) numbers and letters. Patterns or a list of valid strings can be
       specified.

       Continuous Digits - Recognizes a string of connected digits only.
       Constraints such as string length or the allowed values can be specified.
       Item List - Lets callers speak words or phrases from a list (up to 250
       words), e.g. "Please say the name of the person you are calling?" or
       "What stock would you like to buy?"

       VoiceMenu - Lets callers choose a word or phrase from a list (maximum
       of 20). Menus are similar to ItemLists, but shorter so that the prompt
       can read each item to the caller.

       YesNo - Performs the essential function of identifying affirmative and
       negative responses from callers.

       B.  EXTENDED:  Includes Base DialogModules, recognition kernel, reporting
       tools, and the following DialogModules:

       CreditCardNumber - Collects a credit card number. Can understand the
       major credit cards and many private label cards from retailers

       CCExpDate - Collects the expiration date for a credit card, usually month
       and year. It recognizes the last day of a given month as well.

       Currency - Lets callers speak a monetary value in a natural way, e.g.,
       "One hundred twenty-five dollars and thirty two cents. Non US dollars can
       be customized.

       Date - Collects dates in several formats, e.g., June Fourth or 6/4/70,
       nicknames can be mapped, e.g., Christmas or today, allowing callers to
       speak a date in a natural way

       ItemList - Up to 2,500 words

       NaturalNumbers - Collects whole numerical amounts; callers can say "fifty
       four hundred".  Vocabulary for units can also be added, as in "a thousand
       boxes".

       SocialSecurityNumber - Collects a 9-digit US Social Security number.
       Illegal numbers, such as those beginning with three zeroes, are screened
       out

                                      A-1
<PAGE>

       Spelling - Recognizes individual letters so that callers may choose to
       spell out a request.

       TimeOfDay - Collects a naturally spoken time of day.  Callers can use 12-
       hour or 24-hour times, as well as prefix words such as "about" and
       "around TelephoneNumber - Collects a phone number in the "North American
       Numbering Plan" consisting of ten, seven or three digits.  It allows
       common phrases such as "area code" and "one eight hundred".

       ZipCode - Recognizes a five and/or nine digit United States ZIP code

       C.  PROFESSIONAL NL (NATURAL LANGUAGE): Includes Extended DialogModules,
       recognition kernel, reporting tools, and the following DialogModules:

       ItemList - Greater than 2,500 words or phrases

       CustomContext  - Provides the ability to run the results of custom
       modules created with the Software Development Kit.

       The Professional NL will typically require some level of SpeechWorks
       custom development services or development support.

       Name - Available with Release 6.0 making it easier to collect a person's
       first, last or first and last names where the names are completely
       unknown.  Speech Attendant apps should continue using the ItemList
       DialogModules

     3.  SPEECHWORKS REPORTING AND ANALYSIS TOOL is bundled with each of the
     DialogModule packages. The tool generates text diagnostic reports about
     applications based on call logging data. The reports included are:

       Call-Start - displays a percentage breakdown by one hour time period of
       when calls are initiated helping to identify peaks in system usage.

       Call-Length  - displays a percentage breakdown of calls by duration
       tracking the efficiency of user interface improvements that result in the
       reduction of call length.

       Module Transaction Results - summarizes execution results for each
       DialogModule presenting an overall success rate.  Success rates lower
       than 90% indicate problem areas.

       Module Callflow Results - summarizes results of each attempt to collect
       the primary DialogModule data from the caller.  High values for denied
       confirmation and rejection indicate that recognition is not performing
       well.

       Context Results  - summarizes the result of each recognition event.  This
       report illustrates a complete picture of the caller experience at the
       transaction level.

       Module Vocabulary Results - summarizes results classified by the answer
       returned by the recognizer via a DialogModule.  This report can be used
       to give an indication of a) how effective the system recognized a
       caller's utterance and b) how easily callers were able to clarify/confirm
       what was said.

       Context Stats - summarizes various additional statistics for each
       recognition context.  This report allows quick identification of problem
       contexts indicating that improvements are required

     4.  SPEECHWORKS SOFTWARE DEVELOPMENT KIT (SDK) includes the following suite
     of editors and utilities for configuring DialogModules, providing service
     management functions, and supporting ongoing tuning and maintenance:
     Vocabulary Editor (VED), Grammar Development Tools and Application Tuning
     Tools. Included with the SDK are Four (4) Professional NL Run Time Port
     licenses, for development purposes only.

     5.  SPEECHWORKS VOCABULARY LIBRARIES supply pre-packaged and continuously
     maintained language contexts for spoken words/phrases. The User Interface
     for the application using these libraries is not included. The following
     libraries are currently available: (i) Stock Names & Symbols Vocabulary and
     (ii) Mutual Fund Names & Symbols Vocabulary.

                                      A-2
<PAGE>

     6.  SPEAKER VERIFICATION SOFTWARE. When and if available.

     7.  TEXT-TO-SPEECH.  When and if available, to be priced and provided
     [      ].

     This Exhibit may be amended by SpeechWorks upon thirty days prior written
     notice to Licensee; provided that any Subsequent Order received by
     SpeechWorks prior to delivery to Licensee of a new Exhibit A shall be
     binding upon SpeechWorks.

II.  Rich Voice Content.
     ------------------

     SpeechWorks' database of recorded prompts consisting of thousands of
recorded prompts by several different voice talents.  The foregoing includes:

     System Prompts for the following:      [              ], (e.g., [       ],
                                            [           ], [      ] and [
                                                  ]), [     ], [              ],
                                            [        ], [      ], and [    ].

     Application Prompts for the following: [          ], [     ] and [    ],
                                            and [                       ]/[
                                                ] and [            ].

     System Prompts for the following:      [      ], [      ], [     ] ([    ],
                                            [    ], [     ]), [    ], [
                                                 ], [             ], more than
                                            [  ] of the most [         ] and
                                            [       ], more than [  ] [
                                                    ] ([           ], [     ],
                                            [     ]), [     ] (> [  ] [
                                                 ] and [      ]) and [        ]
                                            names.

III.  Required Computer Environment.
      -----------------------------

      ____________(_____) port ___________ voice response unit (VRU) running
      ___________________ operating system.

                                      A-3
<PAGE>

                                   EXHIBIT B
                                  ORDER FORM

     This Order is delivered pursuant to Section 2.7 of that certain Software
License and Professional Services Agreement, dated as of June __, 2000, by and
between SpeechWorks International, Inc. and America Online, Inc. [License
No.00__].

<TABLE>
<CAPTION>

                     PRODUCT DESCRIPTION
PRODUCT NAME
-----------------------------------------------
                                                  RECOGNITION     SYSTEM      FEE/PORT OR      LICENSE
                                                     PORTS         SEATS         SEAT            FEES
----------------------------------------------------------------------------------------------------------
<S>                                               <C>             <C>         <C>             <C>
              Includes:                                                                       $
              .
----------------------------------------------------------------------------------------------------------

              .                                                                               $
----------------------------------------------------------------------------------------------------------
                                                                         TOTAL LICENSE FEES:  $
</TABLE>

SpeechWorks Software will be used in the following computer environment:

_____________(__) port _________________ voice response unit (VRU) running under
______________ operating system.

RECOGNITION PORT:

SpeechWorks acknowledges that telephone lines or ports can be configured with or
without speech recognition dynamically, and as such, charges are based on the
maximum number of simultaneous speech recognizers currently configured in the
total system.

PAYMENT SCHEDULE:

All license fees and other amounts to be paid by AOL under this Agreement shall
be due and payable within thirty (30) days from the date appearing on an
applicable invoice prepared and delivered by SpeechWorks to AOL.

AMERICA ONLINE, INC.               SPEECHWORKS INTERNATIONAL, INC.

By:                                By:
Name:                              Name:
Title:                             Title:

                                      B-1
<PAGE>

                                   EXHIBIT C
                             PROFESSIONAL SERVICES

     Pursuant to Section 3 of the Agreement, SpeechWorks shall provide to AOL
the professional services described in this Exhibit C. In the event of a
conflict of terms with respect to professional services (other than maintenance
and support services) between the Agreement and this Exhibit C, the terms of
this Exhibit C shall govern.

1.  DEFINITIONS

     Terms used and not otherwise defined in this Exhibit C shall have the
meanings set forth in the Agreement.  In addition, the following terms as used
in this Exhibit C shall have the meanings set forth below:

  "Acceptance Criteria" shall mean, with respect to any Deliverable, the
  Specifications, tests and other acceptance criteria set forth in the
  applicable Statement of Work describing such Deliverable.

  "Deliverable"  shall mean the various [     ] and [     ] and/or [     ] in
  connection with [     ] and [     ], [     ], the Custom Software.

  "Milestone Date" shall mean a date set forth in a Statement of Work upon which
  SpeechWorks shall deliver the applicable Deliverable to AOL.

  "Milestone Fees" shall mean the fees (exclusive of sales and other taxes) for
  the development of a Deliverable to be completed in connection with a Project,
  as set forth the applicable Statement of Work.

  "Project" shall mean an effort in which SpeechWorks provides professional
  services to AOL resulting in Deliverable(s) pursuant to a Statement of Work
  specific to the Project.  The first Deliverable for a Project may be the
  development of the Statement of Work.

  "Specifications" shall mean, with respect to any Deliverable, the functions to
  be performed by such Deliverable and expressly referenced in the relevant
  Statement of Work.

  "Statement of Work" shall mean a written document that is mutually acceptable
  to AOL and SpeechWorks for a Project.  The Statement of Work may reference
  other documents for a complete specification of the Deliverables.

  "Tools" and/or "Utilities" shall be defined as software code and/or a portion
  of code that: (a) accelerates the pace of application development or (b)
  accelerates the data conversion process; examples of Tools and Utilities
  include utilities to process logs and produce reports, or work done for
  concatenated prompting.

2.  ENGAGEMENT

2.1   Projects.  SpeechWorks shall complete the Project described on the
Statement of Work attached as Annex 1 to this Exhibit C.  In addition,
SpeechWorks shall complete Projects for AOL under this Agreement pursuant to a
Statement of Work specifically for each such Project, as such Statement of Work
may be agreed upon by SpeechWorks and AOL from time to time.

                                      C-1
<PAGE>

2.2  Time and Materials Work.  From time to time, AOL may request that
SpeechWorks perform general professional services which are separate from and
reasonably outside the scope of services being rendered in connection with a
particular Project.  In such cases and in consideration for such additional
services, AOL shall pay according to the time and materials expended, and
reasonable expenses incurred, by SpeechWorks.  Fees for SpeechWorks' time shall
accrue at the rates set forth in Annex 2 to this Exhibit C; provided, however,
that such rates shall be subject to revision from time to time by SpeechWorks,
upon thirty (30) days written notice to AOL.  SpeechWorks shall submit invoices
to AOL for such fees, materials, and expenses, on a monthly basis, and payment
shall be due and payable within thirty (30) days after receipt of invoice by
AOL.

2.3  Change Order Requests. Either SpeechWorks or AOL may initiate a Project
Change Request ("PCR") as follows:  a PCR may be requested for any reason,
including without limitation, the following:  a material modification, addition
or deletion is required in the services or Deliverables; a material required
task is not identified within one of the Specifications; a task identified in
one of the Specifications has materially changed or is no longer required; AOL
makes a material change to its operating environment; or material modifications
are required to the project scope, schedule or implementation plan.  All
proposed PCRs shall be submitted in writing (including, without limitation, by
email).  Each proposed PCR will specify the nature of the proposed change
requested, the reason for the proposed change, and any subsequent impact to
schedules, Deliverables and cost.  A PCR will not be implemented until all terms
regarding such PCR are agreed upon in writing by SpeechWorks and AOL and
executed by the authorized representatives of both parties.

3.  DEVELOPMENT EFFORTS

3.1  Due Diligence in Completing Projects. After agreement on the terms of a
Statement of Work for a particular Project, SpeechWorks shall diligently proceed
with the development of the Deliverable(s) for such Project in accordance with
the timetable and the Specifications set forth in such Statement of Work.
SpeechWorks shall commit and utilize such resources as it reasonably considers
sufficient to deliver each Deliverable on or before the applicable Milestone
Dates as agreed under the Statement of Work.

3.2  AOL Delay.  AOL acknowledges that any delay by AOL in providing data,
access, or services required by SpeechWorks to complete a Milestone will give
SpeechWorks, upon written notice to AOL, the right to delay subsequent
Milestones by up to: (a) an equivalent delay if the AOL delay is [     ] or
less; (b) [     ] for each [     ] of [       ], if the [      ] is more than
[     ], but less than [      ]; or (c) an equivalent [    ] plus [       ] if
the [       ] is [     ] or longer. In the event of (b) or (c), the parties
will meet to discuss the schedule for resuming work, but such schedule shall not
require SpeechWorks to resume work any sooner than the day after the last day of
delay permitted in this Section 3.2.

3.3  Use of Third Party Contractors. SpeechWorks may, from time to time, engage
third parties to render services in connection with SpeechWorks' development of
the Deliverables; provided, however, that all such third parties who perform
work in furtherance of such development shall execute appropriate documents to
ensure that SpeechWorks' obligations to AOL under Section 3.1 of this Exhibit C
will be satisfied with respect to such work.  SpeechWorks shall at all times
have the sole right and obligation to supervise, manage, contract, direct,
procure, perform, or cause to be performed all work to be performed by
SpeechWorks hereunder unless otherwise provided herein.

3.4  Staffing; [       ].  Notwithstanding the provisions of Section 3.3 of this
Exhibit C, AOL [             ] to (i) [
                            ] (or aspects thereof) and (ii) [
                 ] or [                                         ] reasonably
determines that such [             ] or [                       ].  SpeechWorks
shall [     ]

                                      C-2
<PAGE>

that no SpeechWorks [     ] or [      ] who [                              ]
for [   ] under this Exhibit C shall be [      ] for or on behalf of any
[                  ] during such [                    ]. SpeechWorks shall
implement and maintain reasonable [      ] of [   ] comes within the
[       ] of any [               ] or [            ]  for or on behalf of any
[                        ].

4.  ACCEPTANCE OF DELIVERABLES

4.1  Initial Testing; Rejection. SpeechWorks shall inform AOL as it completes
each Deliverable.  Within [     ] ([     ]) days (the "Acceptance Period") after
receipt of a Deliverable that is associated with a Milestone Fee, AOL may, upon
written notice (the "Rejection Notice") to SpeechWorks, reject any such
Deliverable which fails materially to satisfy the Acceptance Criteria for such
Deliverable.  In any such Rejection Notice, AOL shall document in reasonable
detail the relevant part of the Acceptance Criteria to which the Deliverable
failed materially to satisfy.

4.2  Correction of Failures. SpeechWorks shall use all commercially reasonable
efforts to correct any failure(s) materially to satisfy Acceptance Criteria that
both: (a) are documented in a Rejection Notice that AOL provides in compliance
with Section 4.1 of this Exhibit C and (b) the existence of which SpeechWorks
can confirm; and to deliver the corrected Deliverable to AOL within fifteen (15)
days of receiving such Rejection Notice.  Upon re-delivery of the Deliverable,
AOL shall have an additional Acceptance Period to re-perform tests and establish
that the corrected Deliverable conforms with applicable Acceptance Criteria and
may give a Rejection Notice to SpeechWorks within such additional Acceptance
Period of any continuing failure(s) materially to satisfy Acceptance Criteria.
The foregoing acceptance/rejection/correction process shall be repeated until
all such failures have been corrected by SpeechWorks and AOL's acceptance of the
Deliverable; provided, however, that if, after three (3) attempts SpeechWorks is
unable to correct material failure(s) to satisfy Acceptance Criteria, AOL may
reject the Deliverable.  In the event of such rejection, AOL shall return such
rejected Deliverable, including any copies thereof, and the related
documentation, including any copies thereof, to SpeechWorks.  In such event,
unless the parties otherwise agree in writing, [                     ] to [   ]
all [       ] and other [                  ] by [
      ] [       ], and SpeechWorks shall be under no obligation to continue
to produce Deliverables for the Project for which the rejected Deliverables were
produced.

4.3  Deemed Acceptance. Notwithstanding anything to the contrary in this
Section 4, a Deliverable will be deemed accepted and the associated Milestone
Fee shall be due immediately if either (a) AOL deploys such Deliverable in a
production environment, taking "live" calls; or (b) SpeechWorks receives no
Rejection Notice within a relevant Acceptance Period.

5.  CONSIDERATION; MAINTENANCE AND SUPPORT

5.1  Price.  Except as otherwise provided in Section 2.2 of this Exhibit C, in
consideration of the development services to be performed by SpeechWorks under
this Agreement, AOL shall pay to SpeechWorks the Milestone Fees for each Project
according to the payment schedule set forth in the applicable Statement of Work.
AOL will reimburse SpeechWorks for all travel, lodging and related expenses
which are reimbursable under AOL's then-current travel policy, or, of not
reimbursable thereunder, which have been approved in writing by AOL, as well as
all material direct telecommunications expenses unless otherwise stated in a
Statement of Work.

5.2  Taxes. AOL shall pay or reimburse all federal, state and local taxes
(exclusive of taxes on SpeechWorks' net income) and assessments arising on or
measured by amounts payable to SpeechWorks

                                      C-3
<PAGE>

under this Agreement, or furnish SpeechWorks with evidence acceptable to the
taxing authority to sustain an exemption therefrom.

5.3  Maintenance and Support. Maintenance and support services shall be provided
in accordance with the terms and conditions set forth in Exhibit D to this
Agreement; provided, however, that AOL has promptly paid when due the fees set
forth in Exhibit D to this Agreement and any other applicable maintenance and
support fees mutually agreed upon in writing.

6.  RIGHTS TO DELIVERABLES

6.1  SpeechWorks Techniques.

     (a) Notwithstanding anything in this Agreement to the contrary, nothing in
this Agreement shall transfer ownership of, or limit in any way, SpeechWorks'
ownership or right to use the methodologies, design concepts, techniques,
knowledge or know-how resulting from SpeechWorks' performance of the work
contemplated by, or employed or produced under, this Agreement existing prior to
the time of performance of a given Project for AOL.

     (b) Further, SpeechWorks shall retain all right, title and interest,
including all copyrights and patent rights, in and to any Tools or Utilities
(as defined below) developed by or on behalf of SpeechWorks in whatever form
under a Statement of Work for AOL. For purposes hereof, "Tools" and/or
"Utilities" shall be defined as software code and/or a portion of code that:
(i) accelerates the pace of application development or (ii) accelerates the data
conversion process; examples of Tools and Utilities include utilities to process
logs and produce reports, or work done for concatenated prompting. Upon
acceptance of the applicable Deliverable, SpeechWorks will be deemed to have
granted to AOL a worldwide, nonexclusive, nontransferable, royalty-free,
perpetual, internal use object code license to use such Tools and/or Utilities.

6.2  AOL Techniques.

     (a) Notwithstanding anything in this Agreement to the contrary, nothing in
this Agreement shall transfer ownership of, or limit in any way, AOL's ownership
or right to use the methodologies, design concepts, techniques, knowledge or
know-how resulting from AOL's performance hereunder or any assistance or
cooperation furnished to SpeechWorks by AOL in connection with SpeechWorks'
performance of the work contemplated by this Agreement, or otherwise employed or
produced by AOL under this Agreement.

     (b) AOL shall retain all right, title and interest, including all
copyrights and patent rights, in and to any Tools or Utilities developed by or
on behalf of AOL (other than by SpeechWorks or any contractor of SpeechWorks) in
whatever form, except that derivative works of Tools and Utilities owned by
SpeechWorks (whether pursuant to Section 6.1(b) of this Exhibit C or otherwise)
shall be owned only by SpeechWorks.

6.3  Rights to Deliverables.

     (a) Upon Acceptance of a Deliverable and payment of the applicable fees
therefor, SpeechWorks shall [     ], [     ], [     ], worldwide and irrevocable
(subject to the terms of Section 11.6 of this Agreement) right and license to
use all [     ] under a Statement of Work with the SpeechWorks Software.

                                      C-4
<PAGE>

     (b) SpeechWorks shall retain all rights, title, and interest, including all
copyrights, patent, trade secret and other intellectual property rights
throughout the world, in and to all [     ] developed hereunder, including to
any new [     ], language models, speech data or other enhancements to any
[     ] that results directly or indirectly from the work contemplated
hereunder.

     (c) In consideration of the fees paid by AOL hereunder, SpeechWorks agrees
that it shall not reuse any program code or copy any documents that were
developed under this Agreement for AOL in any system deployed for any of AOL's
Specified Competitors. Notwithstanding the foregoing, AOL acknowledges and
agrees that (i) SpeechWorks is in the business of developing automated speech
recognition software applications for a variety of platforms and environments
and (ii) may perform similar services for any such competitor and in doing so
may use the same personnel and may review (subject to the restriction in the
prior sentence) all documents and usability tests developed or used under this
Agreement.

     (d) Notwithstanding anything contained in Section 6.3(b) of this Exhibit C
to the contrary, all Confidential Information of AOL shall continue to be
governed by the terms of Section 8 of this Agreement.

     (e) Each of SpeechWorks and AOL acknowledge and agree that a Deliverable
may incorporate Pre-Existing Software (as defined below).  SpeechWorks hereby
grants to AOL a non-exclusive, worldwide, fully-paid up, non-transferable
license to use such Pre-Existing Software (to the extent incorporated into the
Deliverable) as necessary or appropriate to AOL's enjoyment of its rights with
respect to the Deliverables, provided that SpeechWorks retains all ownership
rights and title (including, without limitation, all copyrights, trade secret
rights and other intellectual property rights throughout the world) in and to
the Pre-Existing Software.  The term "Pre-Existing Software" shall mean all
software developed by SpeechWorks, the development of which by SpeechWorks pre-
dates the Effective Date of the applicable Statement of Work; provided, however,
that Pre-Existing Software expressly excludes any SpeechWorks Software which
shall be licensed pursuant to the terms of Section 2.1 of this Agreement.

6.4  AOL Property.

     (a) SpeechWorks hereby acknowledges that AOL has certain proprietary
information, data and content that may be delivered to SpeechWorks in tangible
form in order for SpeechWorks to fulfill its development obligations under a
Statement of Work. With respect to each such Statement of Work, AOL shall
identify in a writing provided to SpeechWorks in accordance with Section 15.2 of
this Agreement that information, data and content of AOL which AOL considers
proprietary (the "AOL Property").  SpeechWorks shall have five (5) business days
to notify AOL of its dissent from such assertion.  In the event that SpeechWorks
does not dissent in said 5-day period all information shall be deemed to be AOL
Property. In the event that SpeechWorks so dissents, the parties shall meet as
expeditiously as possible in order to determine in good faith which AOL
deliveries shall be deemed to be AOL Property.  In the event that the parties
cannot agree whether any delivery shall be deemed to be AOL Property,
SpeechWorks may decline to use the subject delivery in a Deliverable.

     (b) Nothing in this Agreement shall transfer ownership of any AOL Property,
or limit in any way AOL's ownership or right to use the AOL Property. AOL will
be deemed to have granted to SpeechWorks a worldwide, nonexclusive,
nontransferable, royalty-free, perpetual, internal use license to use such AOL
Property solely as contemplated by the applicable Statement of Work.

                                      C-5
<PAGE>

7.  LIMITED WARRANTY; DISCLAIMER; AND LIMITATION OF LIABILITY

7.1  Warranties.  (a) Subject to the limitations and exceptions set forth in
this Section 7.1 and in Section 10.3 of the Agreement, SpeechWorks warrants
that, for a period of ninety (90) days after the relevant Milestone Date (the
"Deliverable Warranty Period"), each Deliverable will conform in all material
respects to the relevant Specifications and that the media on which the software
Deliverables are delivered will be free of defects.

     (b) During the Deliverable Warranty Period SpeechWorks warrants that each
software Deliverable, any copies thereof furnished by SpeechWorks hereunder to
AOL or to any third parties specified herein, and any computer media delivered
hereunder to AOL or any such third party shall, at the time of delivery, be free
from computer viruses and any undocumented or unauthorized methods for
terminating or disrupting the operation of, or gaining access to the AOL
Technology or any network, software, computer systems or computing resources or
data of AOL or any of its Affiliates.

     (c) During the Deliverable Warranty Period SpeechWorks represents and
warrants that each software Deliverable is designed to be used during and after
the calendar year 2000 A.D. SpeechWorks further represents and warrants that
each software Deliverable shall perform fully during each time period and
without error relating to date values or other date data provided that input
data is provided in SpeechWorks approved formats, including (A) errors resulting
from or related to date data that represents or references different centuries
or more than one century, and (B) errors resulting from or related to
calculations, processing, sequencing, or employing date data. Without limiting
the generality of the preceding sentences, SpeechWorks represents and warrants
that each software Deliverable (i) shall be capable of accurately, correctly and
consistently accepting, calculating, comparing, sorting, and otherwise
processing, returning, and displaying date inputs and date values, regardless of
when such date data are used, the format or separators used to express such
dates, and whether such dates are read from the internal clock of the hardware,
input by a user, or otherwise, (ii) shall accurately, correctly, and
consistently manage and manipulate data involving dates, including formulas that
involve dates in one century or dates in more than one century, and (iii) shall
not cause an abnormally-ending routine or process within an application or
generate incorrect values or invalid results involving date data.

     (d) SpeechWorks represents and warrants that the software Deliverables
shall not contain any disabling codes, termination logic or any other means to
terminate the use thereof by AOL and its Affiliates or to otherwise disrupt or
electronically repossess such Deliverables.

7.2  Remedies.  In the event that any Deliverable fails during the Deliverable
Warranty Period to conform to any of the warranties set forth in Section 7.1 of
this Exhibit C, AOL shall promptly notify SpeechWorks and provide SpeechWorks
with all available information in written or electronic form so that SpeechWorks
can reproduce any such nonconformity.  SpeechWorks' sole obligation is to
undertake commercially reasonable efforts to correct a reproducible
nonconformity so reported to SpeechWorks during the Deliverable Warranty Period.
SPEECHWORKS' SOLE LIABILITY, AND AOL'S AND AOL'S AFFILIATES' EXCLUSIVE REMEDY
WITH RESPECT TO BREACH OF THE FOREGOING LIMITED WARRANTIES, WILL BE LIMITED TO
ERROR CORRECTION OR PRODUCT REPLACEMENT, OR IF, AFTER EXPENDING REASONABLE
EFFORTS FOR A PERIOD OF NOT LESS THAN SIXTY (60) DAYS TO DO SO, NEITHER IS
COMMERCIALLY FEASIBLE, THEN AOL SHALL RECEIVE A REFUND OF THE FEES RECEIVED BY
SPEECHWORKS FROM AOL HEREUNDER FOR THE NONCONFORMING DELIVERABLE.

                                      C-6
<PAGE>

                             ANNEX 1 TO EXHIBIT C
                        PRECURSOR TO STATEMENT OF WORK

I.  Objective of Document.
    ---------------------

The following is a general description of the scope and functionality of the AOL
Voice Portal, as well as the resources and remuneration that the parties will
respectively provide in developing [     ] of the AOL Voice Portal.  This
document shall be used as the basis for the definitive Statement of Work to be
developed and agreed to with respect to [     ], which definitive Statement of
Work shall be incorporated by reference into and constitute a part of this
Annex 1.

     The parties recognize that the specifics or scope of the AOL Voice Portal
may shift as the definitive Statement of Work is developed or during the
development or deployment of the AOL Voice Portal itself.  In such cases, the
parties will work together to develop a plan (resource commitments,
remuneration, etc.) that is similar to the plan outlined herein, including
specifically SpeechWorks deploying an adequate amount of resources to accomplish
such plan; provided, however, that SpeechWorks shall provide to AOL at a minimum
the resource commitment specifically enumerated in Section IX hereof at AOL's
option as outlined in Section IX.

II.  Voice Portal Principles.
     -----------------------

     This document describes currently anticipated features and functionality
for an [     ] voice portal service, which will initially be optimized for AOL
subscribers. The initial delivery ([     ]) will consist of an [     ]
navigation system and a set of [     ] voice-sites representing key AOL and
[    ] properties.

     The service is intended to be open and extensible to [ ] since, to the
degree possible and as provided in [    ] subsequent to [     ] (or, if
requested by AOL, within [      ] for incremental consideration according to
the principles outlined in Section VIII and Section IX below), it will employ a
standards-based navigation system and will use VoiceXML. Specifically, the goal
is to allow:

          - The AOL Voice Portal service to (1) expand easily beyond the initial
set of content offerings, and (2) access content outside the initial AOL Voice
Portal service offering ([      ]sites etc.). This will enable AOL to leverage
new business opportunities as they become available.

          - The AOL Voice Portal content to be accessed by other compatible
voice browsers that might emerge as the Speech-enabled Web expands

     Throughout this project, AOL intends to develop the expertise required to
become a leading player in the emerging field of voice content. Working with
SpeechWorks, AOL's objective is to gain the tools and skills necessary to:

          - Design, develop and produce voice sites (for its [    ] or [    ]).
          - Deploy and maintain a scalable service
          - Develop and product audio prompts / content

                                      C-7
<PAGE>

III.  Voice Portal Functionality.
      --------------------------

     As currently contemplated, at [     ] launch, Voice Portal users will
dial an [     ] number and be connected to a  speech application which will
allow them navigation to a selection of voice enabled content: [     ],
[     ], [     ] and [     ], and sites ([     ]): [     ], [     ] [     ],
[     ].  In addition, the AOL Voice Portal will interact with the AOL [     ]
to provide AOL Voice Portal Users with access to the AOL [     ] access to
their [     ], either through a voice interface, or via a a oetrombonea [____]
call out to/back from that service.  In addition, the service will enable
[     ], including adds that offer the ability to "[     ]" [     ].

NOTE: several of the above applications have already been developed
(e.g., [     ] and "[     ]") and the [     ] and [     ] may be useful as
foundations (given that the content has already been structured for a limited
form factor).

IV.  Registration.
     ------------

     AOL promotions will initially notify [     ]about the AOL Voice Portal
service and [     ].   All [     ] of the [     ] (e.g.,  not [     ]) can
become authenticated members..   Those who opt to sign up for the AOL Voice
Portal service will be asked to enter an [     ] and [     ]. This [     ]
will be a the [     ] of the [     ] from which they expect to call the
service.   The [     ] will be [     ] selected by the member.  Creation of a
secure-ID login to the AOL namespace will be co-built by AOL and SpeechWorks.

V.  Sign In.
    -------

     Once registered  with the AOL Voice Portal, ,members can call the [     ]to
access the service.   If they are calling from the [     ] the ANI will be
verified and they will be simply asked to type in or say the PIN.   If they are
calling from a phone other than the designated primary phone number they will be
asked to key in the [     ] and then the [     ].

VI.  Channels and Other Features.
     ---------------------------

     The AOL Voice Portal will be organized into [     ].   Above the [     ]
will be a welcome layer that will include sign-in, introduction, help,
promotions, and possibly [     ].  Each [     ] will integrate functionality
from other [     ] so that members can move in a fluid fashion between
functions (e.g., [     ] and [     ].) The [     ] selection will be as follows:

[     ]/[     ]/[     ]/[     ]:
- [     ]
- [     ]
- [     ]
- [     ]
- [     ]
- [     ]
- [     ]
- [     ]
- [     ]
- [     ]

                                      C-8
<PAGE>

[     ]:

     Integration of the existing [     ] service (currently in beta), with a
voice driven interface (note: key issues here are authenticating the member
[     ] and developing a voice recognition based TUI).

[     ]:

     The ability to [     ] and track results for [     ], including an option
for the user to respond and be transferred to either (a) a routine that offers
more pre-recorded information, or (b) directly to the [     ] [     ].

[     ]:

     This [     ] reproduces current [     ] functionality including:

          - [     ]
          - [     ]
          - [     ] ([     ])

[     ]:

     Integration of the [     ] application featuring:

          - [     ].

[     ]:

     A comprehensive [     ] guide offering access to [     ]:

          - [     ]
          - [     ]
          - [     ]
          - [     ]

VII.  Roles and Responsibilities.

     The project will be executed in accordance with the SpeechWorks' Speech
Application Development Lifecycle (SADL).  Specific roles and responsibilities
during this process are outlined in this section.

Project Management

     SpeechWorks will manage all aspects of the software development lifecycle
for all VRU-related call flow software development, in accordance with the
Project Plan. SpeechWorks will provide the following management-related
functions during the development and deployment of the Application in order to
keep AOL informed of the status of development:

(a)  Facilitation of weekly conference calls with the AOL Project Manager.

                                      C-9
<PAGE>

(b)  Monthly status reports regarding project Milestones.
(c)  Performance evaluation and tuning reports during testing and deployment
     phases.
(d)  Consultation to AOL regarding optimal testing, deployment, and use of
     Application.

  AOL will be responsible for providing a project manager responsible for:

(a)  the completion of AOL-assigned tasks and deliverables
(b)  keeping SpeechWorks informed of AOL progress on tasks and deliverables
(c)  providing and overseeing appropriate contact points within AOL for key
     project dependencies

Specification Phase

     SpeechWorks and AOL will jointly execute the Specification Phase of the
project.

SpeechWorks will be responsible for the following:

     (a)  Creating the Requirements Specification document based on project
          requirements defined by AOL.
     (b)  Creating the User Interface Specification document fully defining the
          interface between the Application and the caller.
     (c)  Creating the System Design Document, containing detailed
          specifications of the data and telephony interfaces, operations
          environment, and business logic to be contained within the application
          as specified jointly by SpeechWorks and AOL.
     (d)  Creating the Project Plan detailing SpeechWorks activities and
          timelines in development and deployment phases of the project, as well
          as key dependency dates for non-SpeechWorks responsibilities.

AOL will be responsible for the following:

     (a)  Facilitating access to appropriate AOL personnel required for
          collection of AOL -specific information required by SpeechWorks to
          create Specification Phase deliverables.
     (b)  Facilitating timely approval for Specification Phase documents.
     (c)  Providing telephony and host specifications for the System Design
          document.
     (d)  Ensuring that critical dependencies identified as AOL responsibilities
          in the Project Plan can be achieved.

Development Phase

SpeechWorks will be responsible for:

     .  Developing the Application as defined in the Specification Phase,
including:

  (i)   All interaction with the SpeechWorks product.
  (ii)  Application-specific table data maintained on the VRU.
  (iii) Interactions between the VRU platform and the telephony environment.
  (iv)  Direction of voice talent acquired by AOL (with assistance from
        SpeechWorks).

                                     C-10
<PAGE>

  (v)   Standard operational reports.

     .  Executing Usability Testing of the system, and at its discretion tuning
        the application based on findings

     .  Delivering the Application to AOL for Acceptance Testing, with a list of
        known exceptions.

     .  Supporting AOL and during the Acceptance Testing process, including
        maintenance of the master exception list containing the current status
        of exceptions identified by all three parties

     .  Executing Back-to-Back testing of the VRU.

AOL will be responsible for:

     (a)  Providing access to host APIs from SpeechWorks facilities for
          development and testing purposes.
     (b)  Providing incremental hardware and software required for development
          and testing purposes.
     (c)  Assisting in the recruitment of appropriate Usability Test subjects.
     (d)  Managing all site activities relating to development, installation,
          testing, and deployment of the application. These activities shall
          include the acquisition, and testing of all VRUs, telephony equipment,
          and data communications equipment according to the configuration
          requirements as will be detailed in the System Design.
     (e)  Creating and executing an acceptance test plan to validate that the
          application provided by SpeechWorks to AOL meets the agreed-upon
          requirements. AOL will provide this plan to SpeechWorks at least two
          weeks prior to the conclusion of application development.

     .  Installing the working Application in the AOL environment

     .  Assuming mutual SpeechWorks and AOL consent, AOL may also take
        responsibility for specific components of application development, such
        as implementing a specific leg or legs of the call flow. This will be
        determined by SpeechWorks and AOL during the specification phase.

     .  Stress testing host interfaces for the required volumes.

Deployment Phase

SpeechWorks will be responsible for:

(a)  Deliver the Application for Pilot Test, as well as subsequent iterations of
     the Application created during the Deployment phase
(b)  Monitor Application performance during the Pilot Test and Deployment
     processes, recommend actions for improvement, and at its discretion
     implement those recommendations
(c)  Create an operational report during the Pilot Test phase that provides call
     success and failure statistics.

AOL will be responsible for:

(a)  Ensuring AOL can provide appropriate numbers and types of callers for the
     Pilot test phase.
(b)  Define (with SpeechWorks) and execute the strategy for appropriately
     migrating callers to the system during Partial Deployment. Specific details
     of this plan will be determined during the Specification Phase of the
     project.

                                     C-11
<PAGE>

VIII.  Estimated Timing and Resource Commitments.

Timing:

     .  Provided deal is executed no later July 15, Speechworks to lead a
        product kickoff meeting within [     ] [     ] of execution.

     .  Speechworks to deliver working system deployed on AOL's required number
        of ports no later than [     ] [     ] from kickoff if the system is
        [     ] in [     ].  If the system is [     ] using [     ],
        SpeechWorks will deliver the application within [     ] from kickoff.

Resource Commitments:

     .  Speechworks anticipates dedicating approximately [     ] to developing
        the AOL Voice Portal.  This estimate anticipates I) that the functional
        "depth" and complexity of the relevant applications will be reasonably
        bounded by both parties to work within the [     ] window, ii) that the
        applications are developed in [     ] (not [     ]), and iii) that the
        system is deployed on [     ] ports with a second [     ]-port VRU
        deployed for N+1 redundancy.

     .  Speechworks anticipates that developing the [     ] service in a [     ]
        environment would add [     ]% to the development resources required
        for the task, and would add [     ] to the duration of work.

     .  Speechworks anticipates that deploying the [     ] service on
        approximately [     ] ports would add [     ] to the project, although
        due to parallel work would not slow the deployment by more than [     ]
        to [     ] [     ].

IX.  Consideration.

     As compensation for building the [     ] AOL Voice Portal, AOL shall
provide to  Speechworks payments totalling $[     ], payable:

     .  [     ] invoiced within 10 days after the Effective Date
     .  [     ] upon a mutually-agreed upon midpoint milestone
     .  [     ] upon completion of the work by Speechworks

      In the event that the scope of [     ] changes (including, as outlined
above, the option to deploy on more ports or to develop in [     ]), the
parties will mutually agree to a new scope and Speechworks will commit the
resources necessary to develop the revised [     ] service; provided, however,
that in any event SpeechWorks shall provide to AOL, beginning at the time that
work under any definitive Statement of Work for Phase 1 begins, with up to
[     ] of service at a rate of $[     ].  Further, based on the revisions to
the scope, the consideration outlined above will be adjusted as follows:

     .  If Speechworks commits fewer resources the consideration will be
reduced by a pro-rata amount (which will be calculated by dividing the
estimated resources of the new scope by the estimated resources of the [     ]
scope outlined herein and multiplying by the total consideration outlined
herein), or

                                     C-12
<PAGE>

     .  If Speechworks commits greater resources the consideration will be
increased by a pro-rata amount (which will be calculated by dividing the
estimated resources of the new scope by the estimated resources of the [     ]
scope outlined herein and multiplying by the total consideration outlined
herein).

  AOL shall pay Speechworks the full amount due at each milestone, regardless of
whether AOL launches the portal.
Hardware Platform

For planning purposes, SpeechWorks recommends that AOL proceed with the hardware
platform proposed by [     ] in a 5/12/00 e-mail from [     ] of [     ] to [
] of [     ].  The configuration outlined in this e-mail was as follows:

-  [     ], [     ], [     ]
-  [     ]
-  [     ]

Specific hardware will be determine in the Specification Phase of the project.
 .

                                     C-13
<PAGE>

                             ANNEX 2 TO EXHIBIT C
                        CURRENT TIME AND MATERIALS FEES

<TABLE>
<CAPTION>
                                 PER EIGHT-
                                 HOUR DAY         MINIMUM
     SERVICE                       RATE           OF DAYS
     -------                       ----           -------
<S>                              <C>             <C>
Project Management               $2,500           5 days
Application Consulting           $2,000           5 days
Speech Scientist                 $2,000           5 days
Speech User Interface Design     $1,500           5 days
Application Development          $1,500           5 days
Systems Integration              $1,500           5 days
Operations Support               $1,000           20 days
Installation Services            $1,000           5 days
</TABLE>

     To the extent that, during the Term, SpeechWorks provides [    ] of the
[    ] to any [    ], for [   ], AOL [    ].

                                     C-14
<PAGE>

                                   Exhibit D
                        Maintenance and Support Services

  Pursuant to Section 4 of the Agreement, SpeechWorks shall provide to AOL the
Maintenance and Support Services described in this Exhibit D.  In the event of a
conflict of terms with respect to Maintenance and Support Services between the
Agreement and this Exhibit D, the terms of this Exhibit D shall govern.

1.  DEFINITIONS

     Terms used and not otherwise defined in this Exhibit D shall have the
meanings set forth in the Agreement.  In addition, the following terms as used
in this Exhibit D shall have the meanings set forth below:

  "Error" shall mean any failure of (i) the SpeechWorks Software to conform in
  all material respects to Documentation (ii) the Custom Software to conform to
  the Custom Software Documentation; or (iii) the Licensed Software to conform
  in all material effects to the warranties set forth in paragraphs (b), (c) or
  (d) of Section 9.1 of the Agreement; provided, however, that any nonconformity
  resulting from the following shall not be considered an Error: (a) use by AOL
  of the Licensed Software other than as set forth in the Agreement, the
  Documentation (in the case of the SpeechWorks Software), the Custom Software
  Documentation (in the case of the Custom Software) or as otherwise agreed to
  in writing by the parties, (b) subject to Section 3.1 of this Exhibit D, AOL's
  failure to implement all Updates and Versions issued to AOL within a
  reasonable period of time after delivery thereof to AOL by SpeechWorks; (c)
  interconnecting, integrating, combining and/or merging any Licensed Software
  with any hardware or software (including but not limited to any operating
  system, environment or equipment) not supplied or identified as compatible or
  otherwise recommended or approved by SpeechWorks in writing, or (d) alteration
  of the Licensed Software by any person or entity (other than SpeechWorks)
  without SpeechWorks' written consent.

  "Level 1 Error"  shall mean an Error that either (i) [                   ] the
  [      ], [      ] or [                   ] capabilities of the [
           ]  or (ii) [            ] or [            ] to [
          ] of the [              ].

  "Level 2 Error" shall mean an Error, other than a Level 1 Error, that either
  (i) [                         ], [         ]or [
              ] of the [                ] or (ii) [                        ] or
  [                ] to [                           ] of the [                ].

  "Level 3 Error"  shall mean an Error that causes an operational problem with
  the Licensed Software that is not a Level 1 or 2 Error.

  "Level 4 Error" shall mean any other Error that is not a Level 1, 2 or 3 Error
  including, without limitation, Documentation or administrative screen errors,
  such as typographical errors, screen format errors or syntax errors.

  "Licensed Software" for purposes of this Exhibit D only, shall mean
  SpeechWorks Software and Custom Software for which the parties have agreed
  upon maintenance and support fees.

  "Maintenance and Support Services" shall mean the services described in
  Section 2 of this Exhibit D subject to the exclusions set forth in Sections 3
  and 6 of this Exhibit D.

                                      D-1
<PAGE>

  "Support Plan"  shall mean the support plan described on Annex 1 to this
   Exhibit D.

  "Update" means a modification of the SpeechWorks Software usually intended to
  correct an Error.  Typically, an Update is identified by the numeral(s) one or
  more places to the right of the first decimal point from the left of the
  designation for such Update, with the newer Update having the larger numeral.

  "Version" means a new version of the SpeechWorks Software that contains new
  functionality, level of performance or features for which there is a published
  fee charged to commercial customers of SpeechWorks.  Typically, a Version is
  identified by the numeral(s) to the left of the first decimal point from the
  left in the designation, with the newer Version having the larger numeral.

2.  MAINTENANCE AND SUPPORT SERVICES

2.1  Election of Support Option.  AOL hereby elects the Support Plan designated
on Annex 1 to this Exhibit D for the initial twelve-month period following the
Effective Date.  Such designation shall remain in effect for each subsequent
twelve-month period during the Deployment Period when the provisions of this
Exhibit D are in effect (as provided in Section 5 to this Exhibit D).
Thereafter, in the event that SpeechWorks then makes any maintenance and support
services available to any of its other licensees, AOL may renew such Support
Plan (or such other support plan then available from SpeechWorks), at
SpeechWorks' then-current standard maintenance and support fees, for an
additional twelve-month period upon written notice to SpeechWorks.  The Support
Plan shall apply to all Licensed Software (as defined in Section 1 of this
Exhibit D), including [     ] Custom Software (hereinafter defined) for which
the parties have agreed upon maintenance and support fees.  The provision of
maintenance and support services for Custom Software that is not [     ] Custom
Software (including but not limited to additional Custom Software phases) is
subject to the parties' executing a written agreement setting forth the
applicable terms, conditions and fees for such services.  For purposes of this
Agreement, the term "[     ] Custom Software" shall mean the Custom Software to
be developed by SpeechWorks under the Statement of Work attached hereto as Annex
1 to Exhibit C.

2.2  Condition to SpeechWorks Obligations.  Unless AOL has paid all fees set
forth in Section 4 of this Exhibit D in a timely manner, SpeechWorks shall have
no obligation to provide to AOL the Maintenance and Support Services applicable
under the Support Plan.

2.3  Scope of Maintenance and Support Services.

     (a) The Maintenance and Support Services to be provided hereunder are
intended only to correct Errors (subject to service level provisions of Section
2.8 to this Exhibit D) and to provide, at no additional cost, Updates and
Versions to the SpeechWorks Software.  Notwithstanding the foregoing, this
Exhibit D does not provide for enhancements, Versions, extensions, or new
features or functionality (i) for any Custom Software at any time, or (ii)
except as otherwise provided in the Agreement, for any SpeechWorks Software
after the sixth anniversary of the Effective Date.

     (b) Maintenance and Support Services may not be purchased for Custom
Software alone.

2.4  Maintenance. SpeechWorks shall provide AOL with (a) Updates, when and if
available, and appropriate Documentation delivered electronically for
installation by AOL, and (b) periodic software bulletins providing additional
documentation and provisional solutions to reported problems, on or prior to the
date any of the foregoing is made available to any of SpeechWorks' licensees.

                                      D-2
<PAGE>

2.5  Telephone Support. SpeechWorks shall provide telephone assistance to AOL
with respect to the Licensed Software in accordance with the response and error
correction time targets set forth in Annex 1 to this Exhibit D, such services to
include (a) clarification of functions and features of the Licensed Software,
(b) clarification of Documentation or Custom Software Documentation pertaining
to the Licensed Software, (c) guidance in the operation of the Licensed
Software, and (d) Error verification, analysis and code corrections, as
necessary, to correct any Error to the extent possible (except for code
corrections) by telephone.

2.6  Annual Account Review. SpeechWorks shall provide AOL with one (1) day of
free consulting with senior SpeechWorks staff familiar with this Agreement at
AOL's facility every six (6) months to review the status of the Licensed
Software, assess AOL's ongoing and future use of the Licensed Software, solicit
input from AOL on future development and direction of the Licensed Software, and
to make recommendations regarding AOL's use of the Licensed Software.  The
timing of such consulting shall be at the mutual consent of the parties.
SpeechWorks shall be solely responsible for any costs and expenses (including
travel, lodging and meals) which it may incur pursuant to this Section 2.6.

2.7  Classification of Errors. Upon identification of any Error, AOL shall
notify SpeechWorks of such  Error and provide SpeechWorks with a reasonable
amount of information to assist SpeechWorks to locate and/or replicate the
Error.  [     ] the classification of such Error as either a Level 1, 2, 3 or 4
Error; provided, however, that if the Service Plan only provides for correction
of Errors in the next major release of SpeechWorks Software, then no such
classification shall be made.

2.8  Place of Performance. The Maintenance and Support Services provided
hereunder shall be performed by remote access unless SpeechWorks and AOL
mutually agree that on-site service at AOL's site is required in which event AOL
shall pay for the travel, lodging and related expenses incurred by SpeechWorks
which are reimbursable under AOL's then-current travel policy, or, of not
reimbursable thereunder, which have been approved in writing by AOL.

2.9  AOL Obligations. AOL shall:

     (a) provide supervision, control and management of the use of the Licensed
Software.  In addition, AOL shall take reasonable steps to implement procedures
for the protection of information and the implementation of backup procedures in
the event of Errors or malfunction of the Licensed Software or equipment upon
which the Licensed Software is loaded or operating;

     (b) provide SpeechWorks with reasonable access either telephonically or on
a remote basis to AOL's personnel and equipment upon which the Licensed Software
is loaded or operating.  This access shall be limited to normal business hours
for Level 3 Errors and Level 4 Errors, and shall include for all Errors, when
applicable, the ability to dial-in to equipment on which the Licensed Software
is operating.  This access shall also include the ability to dial-in via a
virtual private network to equipment.  SpeechWorks and AOL shall cooperate on
the establishment of such access, and each party will be responsible its
respective costs necessary to establish such access; provided, that each party
shall supply its own equipment;

     (c) document and promptly report all Errors or malfunctions of the Licensed
Software to SpeechWorks.  AOL shall take all steps reasonably necessary to carry
out procedures for the rectification of such Errors or malfunctions within a
reasonable time after such procedures have been agreed to by the parties;

     (d) maintain a current backup copy of all programs and data; and

                                      D-3
<PAGE>

     (e) reasonably train its personnel in the use and application of the
Licensed Software and the equipment on which the Licensed Software is loaded or
operating.

SpeechWorks is entitled to suspend Maintenance and Support Services under this
Exhibit D to the extent that AOL's material failure to comply with paragraphs
(b), (c) or (e) of this Section 2.9 materially and substantially increases the
cost or difficulty of SpeechWorks providing such services.

2.10  Additional Services. If AOL requests, materials or services for the
Licensed Software for problems encountered by AOL that are outside of the scope
of the Maintenance and Support Services or that AOL desires to have resolved on
a more expedited basis than AOL has contracted for under this Exhibit D,
SpeechWorks shall invoice AOL for SpeechWorks' time, materials used and travel,
lodging and related expenses, and any other reasonable expenses incurred by
SpeechWorks in providing such materials and service; provided that all travel,
lodging and related expenses, and any other expenses in excess of $1,000, if not
eligible for reimbursement under AOL's then-current travel policy, shall be
subject to AOL's prior written approval.  AOL shall pay SpeechWorks the
undisputed amount of any such invoice within thirty (30) days after receipt.

2.11  Training.  SpeechWorks shall, within ninety (90) days after the Effective
Date, furnish to AOL, at AOL's facilities, up to two (2) training sessions at
least as comprehensive as SpeechWorks' standard training session for its other
licensees of SpeechWorks' Software.  Such training shall cover, among other
things, installation and operation of the SpeechWorks Software, and shall be
provided for such number of employees as AOL may determine.  SpeechWorks shall
provide such training at [     ] to AOL, provided AOL shall be responsible for
all travel, lodging and related expenses incurred by SpeechWorks which are
reimbursable under AOL's then-current travel policy, or, of not reimbursable
thereunder, which have been approved in writing by AOL.  AOL may purchase
additional training from SpeechWorks at SpeechWorks' then-current rates.

3.  EXCLUSIONS

3.1  Prior Software Versions. SpeechWorks shall only be obligated to support the
then current production Version of the Licensed Software and to support the
immediately prior release for a period of [     ] ([     ]) [     ] after the
release of the then current production Version.

3.2  Operating Environment. Insofar as the use of a certain release of the
Licensed Software requires the use of a particular release of system software
(such as operating system, firmware or utilities) on the equipment specified in
this Agreement, SpeechWorks will so notify AOL in writing prior to the issuance
of such release.  In the event that AOL is not then using the particular release
of system software, and AOL elects not to upgrade to such particular release of
system software, AOL shall so notify SpeechWorks and [       ] shall [       ]
to [                 ] and [                ] under this Exhibit D, subject to
the understanding that AOL will not receive Updates or Versions for the Licensed
Software running on the non-upgraded system software, and that SpeechWorks'
ability to correct Errors in such Licensed Software will be adversely affected
thereby (and such limited Error correction shall not constitute a breach of this
Agreement).

3.3  Designated Contact Groups.  SpeechWorks will only provide Maintenance and
Support Services to up to that [        ] of [                             ] of
AOL specified on Annex 1 to this Exhibit D, the members of which have been
trained and certified by SpeechWorks in the use of SpeechWorks' Software, and
who have an in-depth knowledge of AOL's network operations and infrastructure.

                                      D-4
<PAGE>

4.  CONSIDERATION

4.1  Fees.  AOL shall be invoiced by SpeechWorks at the beginning of each
twelve-month period for which this Exhibit D is in effect, the applicable annual
fee for the Support Plan and for support plans for Licensed Software, as
specified on Annex 1 to this Exhibit D.

4.2  Time of Payment. Except as otherwise provided in this Exhibit D, all
amounts due to SpeechWorks shall be paid within thirty (30) days of AOL's
receipt of invoice from SpeechWorks.

5.  TERM AND TERMINATION

5.1  Term.  The provisions of this Exhibit D shall become effective on the
Effective Date, shall remain in effect for an initial term of twelve (12)
months, and shall thereafter automatically be renewed for successive twelve (12)
month terms, unless AOL gives SpeechWorks notice at least thirty (30) days prior
to the expiration of a twelve (12) month term that such renewal shall not occur,
in which event the provisions of this Exhibit D shall expire at the end of such
term, except as otherwise provided in this Exhibit D.  Subject to Section 2.1 of
this Exhibit D, in no event, however, shall any obligation of SpeechWorks to
provide Maintenance and Support Services (a) extend beyond the termination or
expiration of this Agreement, or (b) commence prior to the execution of this
Agreement, unless otherwise agreed in writing by the parties.

5.2  Termination. The obligations of SpeechWorks and AOL under this Exhibit D:
(a) shall terminate immediately upon the termination of this Agreement pursuant
to Section 11.3, 11.4, 11.5 or 13.2 of this Agreement, or the expiration of the
Deployment Period, if earlier, or (b) may be terminated by either party
immediately upon giving written notice to the other party if such other party
commits a material breach of this Exhibit D and shall have failed to cure such
breach within thirty (30) days of receipt of a request in writing from the
notifying party to do so; provided, however, that upon any termination under
this Section 5.2 or otherwise, all earned and unpaid fees and other charges
payable under this Exhibit D shall become immediately due and payable.

5.3  Survival of License. Termination of Maintenance and Support Services upon
failure to renew will not affect the license of the Licensed Software.

6.  OWNERSHIP AND WARRANTY DISCLAIMER

6.1  Title.  Subject to Section 6 of Exhibit C, all Updates, Versions and other
changes, improvements, bug fixes or other modifications to the SpeechWorks
Software provided under this Exhibit D shall be deemed to be included within the
SpeechWorks Software and will be subject to the terms and conditions of this
Agreement.  Subject to Section 6 of Exhibit C, all Updates, Versions and other
changes, improvements, bug fixes and other modifications to the Custom Software
provided under this Exhibit D shall be deemed to be included in the Custom
Software and will be subject to the terms and conditions of this Agreement.

6.2  Limited Warranty of Performance and Exclusive Remedy.  SpeechWorks warrants
that it shall use commercially reasonable efforts to provide effective
Maintenance and Support Services while this Exhibit D remains in effect.  This
warranty shall not apply to the Licensed Software if such Licensed Software has
been modified by any party other than SpeechWorks or its third party contractors
without the consent of SpeechWorks.  The warranty under this Exhibit D is made
only to AOL and SpeechWorks shall have no liability to any third party with
respect to the Licensed Software as a result of such warranty.  Under no
circumstances does SpeechWorks warrant or represent that all Errors can or will
be corrected.  If SpeechWorks damages or loses any of AOL's data during the
performance of Maintenance

                                      D-5
<PAGE>

and Support Services, then, if AOL provides SpeechWorks with back-up data
necessary to do so, SpeechWorks shall re-create or reconstruct the damaged or
lost data, and shall bear the costs related to such re-creation or
reconstruction.

6.3  Remedy.  Between the end of the Warranty Period and the date ninety (90)
days after the commercial launch date of an AOL Voice Portal (the "Commercial
Launch Date"), for each 20-day period that any Level 1 or Level 2 Error which
prevents (or substantially hampers) at least [     ] users or [     ] percent ([
]%) of users of all AOL Voice Portals from accomplishing at least one of their
goals in calling the system remains uncorrected, SpeechWorks shall [       ]
the greater of [      ] or [     ] ([     ]) [     ] maintenance and support
[    ] ([    ] maintenance and support [    ]). After the date [     ] ([    ])
days after the Commercial Launch Date, for each [     ]-day period that any
Level 1 or Level 2 Error which prevents (or substantially hampers) at least
[     ] users or [     ] percent ([     ]%) of users of all AOL Voice Portals
from accomplishing at least one of their goals in calling the system remains
uncorrected, SpeechWorks shall [   ] [      ] or [     ] ([     ]) [     ]
maintenance and support [     ] ([      ] maintenance and support [     ]). For
purposes of this Section 6.3, an Error that becomes apparent (or should
reasonably have become apparent) at any time prior to the date [     ] ([     ])
days after the Commercial Launch Date shall be subject only to the [        ]
of this Section 6.3.  In addition, SpeechWorks shall in no event be required
[     ] under this Section 6.3 [     ] of the maintenance and support [     ]
maintenance and support term.  If at any time a Level 1 Error which prevents
(or substantially hampers) at least [        ] users or [         ]
percent ([     ]%) of users of all AOL Voice Portals from accomplishing [     ]
in calling the system remains uncorrected for [    ] ([     ]) [     ] following
SpeechWorks' receipt of notice thereof, or a Level 2 Error which prevents (or
substantially hampers) at least [     ] users or ten percent ([     ]%) of users
of all AOL Voice Portals from accomplishing at least one of their goals in
calling the system remains uncorrected for [     ] ([     ]) days following
SpeechWorks' receipt of notice thereof, then (i) AOL may terminate this
Agreement, (ii) AOL may cause the [     ] in accordance with Section 4.1(c) of
the Escrow Agreement and AOL shall be entitled to exercise the license to such
Source Code specified in the Escrow Agreement, and (iii) AOL shall no longer be
entitled to [              ] under either of the first two sentences of this
Section 6.3.

6.4  DISCLAIMER.  THE REMEDIES SPECIFIED IN SECTION 6.3 OF THIS EXHIBIT D ARE
SPEECHWORKS' SOLE AND EXCLUSIVE LIABILITY IN CONNECTION WITH SPEECHWORKS'
FAILURE TO REMEDY ANY LEVEL 1 ERRORS OR LEVEL 2 ERRORS.  EXCEPT FOR THE EXPRESS
WARRANTIES STATED IN THIS EXHIBIT D, TO THE MAXIMUM EXTENT PERMITTED BY
APPLICABLE LAW, NO ADDITIONAL WARRANTY, EXPRESS OR IMPLIED, STATUTORY OR
OTHERWISE, AS TO THE CONDITION, QUALITY, COMPLETENESS, PERFORMANCE,
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE MAINTENANCE AND
SUPPORT SERVICES, ERROR CORRECTIONS, OR UPDATES OR VERSIONS, OR THE
COMPREHENSIVENESS OF ANY DOCUMENTATION FURNISHED HEREUNDER IS GIVEN OR ASSUMED
BY AOL AND ALL SUCH WARRANTIES, CONDITIONS, UNDERTAKING AND TERMS ARE HEREBY
EXCLUDED.

                                      D-6
<PAGE>

                              Annex 1 to Exhibit D
                          Description of Support Plan

1.  Error Corrections.  Upon receipt of notice(s) from AOL specifying Errors in
the Licensed Software, SpeechWorks will resolve the Errors according to the
following Severity Levels:

     (a)  Level 1 Errors: SpeechWorks will work with AOL on a [     ], [     ]
                    basis, will begin working with AOL's system administration
                    group member(s) within [     ] of the notification, and will
                    [     ] to resolve the Level 1 Error as quickly as possible.
                    SpeechWorks shall be deemed to have "resolved" a Level 1
                    Error if [     ] that the Error has been corrected or
                    reduced in scope to a Level 2, 3 or 4 Error.

     (b)  Level 2 Errors: SpeechWorks will exert commercially reasonable efforts
                    to resolve the Level 2 Error as quickly as possible.  If
                    such Error is not resolved within [     ], SpeechWorks will,
                    at AOL's option, work with AOL's system administration group
                    member(s) to resolve such Error on a [     ], [     ] basis
                    until it is resolved.  SpeechWorks shall be deemed to have
                    "resolved" a Level 2 Error if [     ] that the Error has
                    been corrected or reduced in scope to a Level 3 or 4 Error.

     (c)  Level 3 Errors: SpeechWorks will exert commercially reasonable
                    efforts to resolve the Level 3 Error within [     ].  If
                    such Error is not resolved within [     ], SpeechWorks will
                    exert commercially reasonable efforts to resolve the Error
                    as quickly as possible.  SpeechWorks shall be deemed to have
                    "resolved" a Level 3 Error if [     ] that the Error has
                    been corrected or reduced in scope to a Level 4 Error.

     (d)  Level 4 Errors: SpeechWorks will exert commercially reasonable
                    efforts to correct Level 4 Errors in the next standard
                    Update of the Licensed Software, or earlier at their sole
                    discretion.

2.    Escalation Procedure.

     (a)  Level 1 Errors: Should SpeechWorks be unable to resolve a Level 1
                    Error within [     ] after notification, the appropriate
                    second level managers from AOL and SpeechWorks shall meet by
                    teleconference and thoroughly discuss the current status and
                    resolution plan.  From that point until the Error is
                    resolved, SpeechWorks will provide an appropriate AOL
                    manager every [     ] an evaluation of the existing Error
                    resolution efforts and an estimate resolution time.  Should
                    SpeechWorks be unable to resolve a Level 1 Error within [
                    ] after notification, the appropriate third level managers
                    from AOL and SpeechWorks shall jointly review the status of
                    the Situation, and every [     ] thereafter until the Error
                    is resolved.  Should SpeechWorks be unable to resolve a
                    Level 1 Error within [     ] after notification, the
                    appropriate fourth level managers from AOL and SpeechWorks
                    shall jointly review the status of the Situation, and every
                    [     ] thereafter until the Error is resolved.

                                      D-7
<PAGE>

     (b)  Level 2 Errors: From that time SpeechWorks is notified, SpeechWorks
                    will provide an appropriate AOL manager every [     ] an
                    evaluation of the existing Error resolution efforts and an
                    estimate resolution time.  Should SpeechWorks be unable to
                    resolve a Level 2 Error within [     ] after notification,
                    the appropriate second level managers from AOL and
                    SpeechWorks shall meet by teleconference and thoroughly
                    discuss the current status and resolution plan.  Should
                    SpeechWorks be unable to resolve a Level 2 Error within [
                    ] after notification, the appropriate third level managers
                    from AOL and SpeechWorks shall jointly review the status of
                    the Situation, and every [     ] thereafter until the Error
                    is resolved.

3.  Provision of Versions and Updates.  Under the Support Plan, during the
Deployment Period, AOL will receive Versions and Updates to SpeechWorks Software
as well as periodic software bulletins providing additional documentation and
provisional solutions to reported problems; provided, however, that SpeechWorks
shall not be obligated to provide Versions after the [     ] of the Effective
Date.  For as long as AOL remains eligible to receive Maintenance and Support
Services under Section 2.1 of Exhibit D after the [     ] of the Effective Date,
AOL may purchase Versions at SpeechWorks' standard list prices therefor (except
that AOL shall be provided Versions for no additional charge if AOL has paid
SpeechWorks' then-current standard maintenance and support fees for maintenance
and support services during each [     ] period following the end of the
Deployment Period that include the provision of Versions).  As used in the
tables above, the term "business day" means Monday through Friday (excluding
national holidays).  All times are in Washington, D.C. time.

4.  Maintenance and Support Fees.

          For the SpeechWorks Software:
<TABLE>
<CAPTION>

              LICENSE FEES PAID              ANNUAL MAINTENANCE FEE

                                                       Percentage of License
              Minimum             Maximum                    Fees Paid               Minimum            Maximum
              -------             -------              ---------------------         -------            -------
<S>                               <C>                  <C>                           <C>                <C>
              $      0            $[     ]                      N/A                  $[     ]           $[     ]
              $[     ]            $[     ]                    [     ]%               $[     ]           $[     ]
              $[     ]            $[     ]                    [     ]%               $[     ]           $[     ]
              $[     ]            $[     ]                    [     ]%               $[     ]           $[     ]
              $[     ]            $[     ]                    [     ]%               $[     ]           $[     ]
              $[     ]            $[     ]                    [     ]%               $[     ]           $[     ]
</TABLE>

          For Additional Languages of SpeechWorks Software:

          A [     ] fee of $[     ] per language.  The term of maintenance and
support for additional languages of SpeechWorks Software shall continue only as
long as AOL purchases maintenance and support for the SpeechWorks Software
initially licensed hereunder pursuant to the table provided above.

          For Custom Software:

          [     ] Custom Software:  A [     ] fee of $[     ] due [     ] ([
                              ]) [     ] after acceptance of the Custom
                              Software.  The term of maintenance and support for
                              [      ] Custom Software

                                      D-8
<PAGE>

                              shall continue only as long as AOL purchases
                              maintenance and support for the SpeechWorks
                              Software initially licensed hereunder pursuant to
                              the table provided above.

          [     ] Custom Software:  To be agreed upon in writing by the
                              parties.

5.   Designated Contact [    ].  AOL shall be permitted to name up to [     ]
([ ]) system [ ] for purposes of Section 3.3 of this Exhibit D; provided,
however, that [ ] ([ ]) of such [ ] shall be located in, and servicing only
facilities located in, North America, and [ ] ([ ]) of such [ ] may be located
in any country, but must be servicing only facilities located in the country in
which it is located. AOL may purchase additional designated contact [    ] for
$[ ] per named system administration [ ]. AOL shall use commercially reasonable
efforts to ensure that notifications of Errors and requests for assistance are [
], and that all such individuals have been trained effectively in the use of
SpeechWorks Software, and that all have an in-depth knowledge of AOL's network
operations and infrastructure.

                                      D-9
<PAGE>

                                   Exhibit E
         Common Stock and Warrant Purchase Agreement; Related Documents

                            SEE THE FOLLOWING PAGES.

                                      E-1
<PAGE>

                                   EXHIBIT F
                Form of Source Code Escrow and License Agreement

                        SPEECHWORKS INTERNATIONAL, INC.
                       MASTER PREFERRED ESCROW AGREEMENT

This Agreement is effective June __, 2000 among DSI Technology Escrow Services,
Inc. ("DSI"), SpeechWorks International, Inc. ("Depositor") and any additional
party signing the Acceptance Form attached to this Agreement ("Preferred
Beneficiary"), who collectively may be referred to in this Agreement as "the
parties."

A.   Depositor and preferred Beneficiary have entered or will enter into a
license agreement, development agreement, and/or other agreement (referred to in
this Agreement as the "License Agreement") regarding certain proprietary
technology of Depositor, pursuant to which Depositor will license to Preferred
Beneficiary one or more of Depositor's products (referred to in this Agreement
collectively as the "Product").

B.   Depositor desires to avoid disclosure of its proprietary technology except
under certain limited circumstances.

C.   The availability of the proprietary technology of Depositor is critical to
Preferred Beneficiary in the conduct of its business and, therefor, Preferred
Beneficiary needs access to the proprietary technology under certain limited
circumstances.

D.   Depositor and preferred Beneficiary desire to establish an escrow with DSI
to provide for the retention, administration and controlled access of certain
proprietary technology materials of Depositor.

E.   The parties desire this Agreement to be supplementary to the License
Agreement pursuant to 11 United States Code, Section 365(n).

1.  DEPOSITS

1.1  OBLIGATION TO MAKE DEPOSIT.  Upon the signing of this Agreement by the
parties, including the signing of the Acceptance Form, Depositor shall deliver
to DSI the proprietary technology and other materials ("Deposit Materials")
required to be deposited by the License Agreement or, if the License Agreement
does not identify the materials to be deposited with DSI, then such materials
will be identified on an Appendix 1.  If Appendix 1 is applicable, it is to be
prepared and signed by Depositor and preferred Beneficiary.  DSI shall have no
obligation with respect to the preparation, signing or delivery of Appendix 1.

1.2  IDENTIFICATION OF TANGIBLE MEDIA.  Prior to the delivery of the Deposit
Materials to DSI, Depositor shall conspicuously label for identification each
document, magnetic tape, disk, or other tangible media upon which the Deposit
Materials are written or stored.  Additionally, Depositor shall complete
Appendix 2 to this Agreement by listing each such tangible media by the item
label description, the type of media and the quantity.  The Appendix 2 must be
signed by Depositor and delivered to DSI with the Deposit Materials.  Unless and
until Depositor makes the initial deposit with DSI, DSI shall have no obligation
with respect to this Agreement, except the obligation to notify the parties
regarding the status of the deposit account as required in Section 2.2 below.

                                      F-1
<PAGE>

1.3  DEPOSIT INSPECTION.  When DSI receives the Deposit Materials and the
Appendix 2, DSI will conduct a deposit inspection by visually matching the
labeling of the tangible media containing the Deposit Materials to the item
descriptions and quantity listed n the Appendix 2.  In addition to the deposit
inspection, Preferred Beneficiary may elect to cause a verification of the
Deposit Materials in accordance with Section 1.6 below.

1.4  ACCEPTANCE OF DEPOSIT.  At completion of the deposit inspection, if DSI
determines that the labeling of the tangible media matches the item descriptions
and quantity on Appendix 2, DSI will date and sign the Appendix 2 and mail a
copy thereof to Depositor and Preferred Beneficiary.  If DSI determines that the
labeling does not match the item descriptions or quantity on the Appendix 2, DSI
will (a) note the discrepancies in writing on the Appendix 2; (b) date and sign
the Appendix 2 with the exceptions noted; and (c) mail a copy of the Appendix 2
to Depositor and Preferred Beneficiary.  DSI's acceptance of the deposit occurs
upon the signing of the Appendix 2 by DSI.  Delivery of the signed Appendix 2 to
Preferred Beneficiary is Preferred Beneficiary's notice that the Deposit
Materials have been received and accepted by DSI.

1.5  DEPOSITOR'S REPRESENTATIONS.  Depositor represents as follows:

   (a)  Depositor lawfully possesses all of the Deposit Materials deposited with
DSI;
   (b)  With respect to all of the Deposit Materials, Depositor has the right
and authority to grant to DSI and Preferred Beneficiary the rights as provided
in this Agreement;

   (c)  The Deposit Materials are not subject to any lien or other similar
encumbrance, other than any lien that Depositor may have granted in the
proprietary technology that is embodied in the Deposit Materials;

   (d)  The Deposit Materials consist of the proprietary technology and other
materials identified either in the License Agreement or Appendix 1, as the case
may be; and

   (e)  The Deposit Materials are readable and useable in their current form or,
if the Deposit Materials are encrypted, the decryption tools and decryption keys
have also been deposited.

1.6  VERIFICATION.  Preferred Beneficiary shall have the right, at Preferred
Beneficiary's expense, to cause a verification of any Deposit Materials.  A
verification determines, in different levels of detail, the accuracy,
completeness, sufficiency and quality of the Deposit Materials.  If a
verification is elected after the Deposit Materials have been delivered to DSI,
then only DSI, or at DSI's election an independent person or company selected
and supervised by DSI and who has signed a confidentiality agreement with terms
and conditions substantially similar to those set forth in Section 2.1, in which
Depositor is named as a third party beneficiary, may perform the verification.
Such verification may be requested once per Appendix 2, no later than thirty
(30) days after delivery thereof to DSI by Depositor.  Depositor may at its
discretion designate a representative to be present at the verification.

1.7  DEPOSIT UPDATES.  Unless otherwise provided by the License Agreement,
Depositor shall update the Deposit Materials within 60 days of each release of a
new version of the Product to be delivered under the License Agreement.  Such
updates will be added to the existing deposit.  All deposit updates shall be
listed on a new Appendix 2 and the new Appendix 2 shall be signed by Depositor.
Each Appendix 2 will be held and maintained separately within the escrow
account.  An independent record will be created which will document the activity
for each Appendix 2.  The processing of all deposit updates shall be in
accordance with Sections 1.2 through 1.6 above.  All references in this
Agreement to the Deposit Materials shall include the initial Deposit Materials
and any updates.

1.8  REMOVAL OF DEPOSIT MATERIALS.  The Deposit Materials may be removed and/or
exchanged only on written instructions signed by Depositor and Preferred
Beneficiary, or as otherwise provided in this Agreement.

                                      F-2
<PAGE>

2.  CONFIDENTIALITY AND RECORD KEEPING

2.1  CONFIDENTIALITY.  DSI shall maintain the Deposit Materials in a secure,
environmentally safe, locked facility which is accessible only to authorized
representatives of DSI.  DSI shall have the obligation to reasonably protect the
confidentiality of the Deposit Materials.  Except as provided in this Agreement.
DSI shall not disclose, transfer, make available, or use the Deposit Materials.
DSI shall not disclose the content of this Agreement to any third party.  If DSI
receives a subpoena or other order of a court or other judicial tribunal
pertaining to the disclosure or release of the Deposit Materials, DSI will
immediately notify the parties to this Agreement.  It shall be the
responsibility of Depositor and/or Preferred Beneficiary to challenge any such
order; provided, however, that DSI does not waive its rights to present its
position with respect to any such order.  DSI will not be required to disobey
any court or other judicial tribunal order.  (See Section 7.5 below for notices
of requested orders.)

2.2  STATUS REPORTS.  DSI will issue to Depositor and Preferred Beneficiary a
report profiling the account history at least semi-annually.  DSI may provide
copies of the account history pertaining to this Agreement upon the request of
any party to this Agreement.

2.3  AUDIT RIGHTS.  During the term of this Agreement, Depositor and preferred
Beneficiary shall each have the right to inspect the written records of DSI
pertaining to this Agreement.  Any inspection shall be held during normal
business hours and following reasonable prior notice.

3.  GRANT OF RIGHTS TO DSI

3.1  TITLE TO MEDIA.  Depositor hereby transfers to DSI the title to the media
upon which the proprietary technology and materials are written or stored.
However, this transfer does not include the ownership of the proprietary
technology and materials contained on the media such as any copyright, trade
secret, patent or other intellectual property rights.

3.2  RIGHT TO MAKE COPIES.  DSI shall have the right to make copies of the
Deposit Materials as reasonably necessary to perform this Agreement.  DSI shall
copy all copyright, nondisclosure, and other proprietary notices and titles
contained on the Deposit Materials onto any copies made by DSI.  With all
Deposit Materials submitted to DSI.  Depositor shall provide any and all
instructions as may be necessary to duplicate the Deposit Materials including
but not limited to the hardware and/or software needed.

4.  RELEASE OF DEPOSIT

4.1  RELEASE CONDITION.  As used in this Agreement, "Release Condition" shall
                                                     -----------------
mean the following:

     (a)  Any rejection or termination of the License Agreement under Title II
of the United States Code, as now constituted or hereafter amended (the
"Bankruptcy Code"), or any other federal, or state bankruptcy, insolvency,
receivership, or similar law; or

     (b)  Depositor ceases doing business in the normal course for a continuous
period of ninety (90) days; or

     (c)  A Level 1 Error which prevents (or substantially hampers) at least [
] users or [     ] percent ([     ]%) of users of all AOL Voice Portals from
accomplishing at least one of their goals in calling the system remains
uncorrected for [     ] ([     ]) days following Depositor's receipt of written
notice thereof, or a Level 2 Error which prevents (or substantially hampers) at
least [     ] users or [     ] percent ([     ]%)

                                      F-3
<PAGE>

of users of all AOL Voice Portals from accomplishing at least one of their goals
in calling the system remains uncorrected for [ ] ([ ]) days following
Depositor's receipt of written notice thereof (as the foregoing terms are
defined in the License Agreement); or

     (d)  Occurrence of a Trigger Event where the Acquiring Entity is a
Specified AOL Competitor (as the foregoing terms are defined in the License
Agreement).

4.2  FILING FOR RELEASE.  If Preferred Beneficiary believes in good faith that a
Release Condition has occurred, Preferred Beneficiary may provide to DSI written
notice of the occurrence of the Release Condition and a request for the release
of the Deposit Materials.  Upon receipt of such notice, DSI shall provide a copy
of the notice to Depositor by commercial express mail.

4.3  CONTRARY INSTRUCTIONS.  From the date DSI mails the notice requesting
release of the Deposit Materials, Depositor shall have twenty business days to
deliver to DSI Contrary Instructions.  "Contrary Instructions" shall mean the
representation by Depositor that a Release Condition has not occurred or has
been cured.  Upon receipt of Contrary Instructions, DSI shall send a copy to
Preferred Beneficiary by commercial express mail.  Additionally, DSI shall
notify both Depositor and Preferred Beneficiary that there is a dispute to be
resolved pursuant to the Dispute Resolution section of this Agreement (Section
7.3).  Subject to Section 5.2, DSI will continue in store the Deposit Materials
without release pending (a) joint instructions from Depositor and Preferred
Beneficiary; (b) resolution pursuant to the Dispute Resolution provisions; or
(c) order of a court.

4.4  RELEASE OF DEPOSIT.,  If DSI does not receive Contrary Instructions from
the Depositor, DSI is authorized to release the Deposit Materials to the
Preferred Beneficiary or, if more than one beneficiary is registered to the
deposit, to release a copy of the Deposit Materials to the Preferred Beneficiary
requesting release.  However, DSI is entitled to receive any fees due DSI before
making the release.  Any copying expense in excess of $300 will be chargeable to
Preferred Beneficiary.  Upon any such release, the escrow arrangement will
terminate as it relates to the Depositor and Preferred Beneficiary involved in
the release.

4.5  RIGHT TO USE AFTER RELEASE.  Unless otherwise provided in the License
Agreement, upon release of the Deposit Materials in accordance with this Article
4, Preferred Beneficiary shall have the right to use the Deposit Materials for
the sole purpose of supporting licensed copies of the then current version of
the Product that Preferred Beneficiary is contractually obligated to support,
and not for the purpose of developing or distributing enhancements of the
Product.,  Preferred Beneficiary shall be obligated to maintain the
confidentiality of the released Deposit Materials.

5.  TERM AND TERMINATION

5.1  TERM OF AGREEMENT.  The initial term of this Agreement is for a period of
one year.  Thereafter, this Agreement shall automatically renew from year-to-
year unless (a) Depositor and Preferred Beneficiary jointly instruct DSI in
writing that the Agreement is terminated; (b) Preferred Beneficiary instructs
DSI in writing that the Agreement is terminated as it relates to Preferred
Beneficiary; or (c) the Agreement is terminated by DSI for nonpayment in
accordance with Section 5.2.  If the Acceptance Form has been signed at a date
later than this Agreement, the initial term of the Acceptance Form will be for
one year with subsequent terms to be adjusted to match the anniversary date of
this agreement.  If the deposit materials are subject to another escrow
agreement with DSI, DSI reserves the right, after the initial one year term, to
adjust the anniversary date of this agreement to match the then prevailing
anniversary date of such other escrow arrangement.

                                      F-4
<PAGE>

5.2  TERMINATION FOR NONPAYMENT.  In the event of the nonpayment of fees owed to
DSI, DSI shall provide written notice of delinquency to the parties to this
Agreement affected by such delinquency.  Any such party shall have the right to
make the payment to DSI to cure the default.  If the past due payment is not
received in full by DSI within one quarter of the date of such notice, then at
any time thereafter DSI shall have the right to terminate this Agreement to the
extent it relates to the delinquent party by sending written notice of
termination to such affected parties.  DSI shall have no obligation to take any
action under this Agreement so long as any payment due to DSI remains unpaid.

5.3  DISPOSITION OF DEPOSIT MATERIALS UPON TERMINATION.  Upon termination of
this Agreement, DSI shall destroy, return, or otherwise deliver the Deposit
Materials in accordance with Depositor's instructions.  If there are no
instructions, DSI may, at its sole discretion, destroy the Deposit Materials or
return them to Depositor.  DSI shall have no obligation to return or destroy the
Deposit Materials if the Deposit Materials are subject to another escrow
agreement with DSI.

5.4  SURVIVAL OF TERMS FOLLOWING TERMINATION.  Upon termination of this
Agreement, the following provisions of this Agreement shall survive:

     (a)  Depositor's Representations (Section 1.5);
                                       -----------
     (b)  The obligations of confidentiality with respect to the Deposit
Materials;
     (c)  The rights granted in the section entitled Right to Use After Release
(Section 4.5), if a release of the Deposit Materials has occurred prior to
termination;
     (d)  The obligation of Preferred Beneficiary to pay DSI any fees and
expenses due;
     (e)  The provisions of Article 7; and
     (f)  Any provisions in this Agreement which specifically state they survive
the termination or expiration of this Agreement.

6.  DSI'S FEES

6.1  FEE SCHEDULE.  All fees and expenses charged by DSI will be borne by
Preferred Beneficiary.  Depositor shall not be required to reimburse preferred
Beneficiary for any such fees, expenses or other charges billed to Preferred
Beneficiary by DSI.  DSI is entitled to be paid its standard fees and expenses
applicable to the services provided.  DSI shall notify Preferred Beneficiary,
the party responsible for payment of DSI's fees hereunder, at least 90 days
prior to any increase in fees.  For any service not listed on DSI's standard fee
schedule, DSI will provide a quote prior to rendering the service, if requested.

6.2  PAYMENT TERMS.  DSI shall not be required to perform any service unless the
payment for such service and any outstanding balances owed to DSI are paid in
full.  Fees are due upon receipt of a signed contract or receipt of the Deposit
Materials whichever is earliest.  If invoiced fees are not paid, DSI may
terminate this Agreement in accordance with Section 5.2.  Late fees on past due
amounts shall accrue interest at the rate of one and one-half percent per on the
(18% per annum) from the date of the invoice.

7.  LIABILITY AND DISPUTES

7.1  RIGHT TO RELY ON INSTRUCTIONS.  DSI may act in reliance upon any
instruction, instrument, or signature reasonably believed by DSI to be genuine.
DSI may assume that any employee of a party to this Agreement who gives any
written notice, request, or instruction has the authority to do so.  DSI shall
not be responsible for failure to act as a result of causes beyond the
reasonable control of DSI.

                                      F-5
<PAGE>

7.2  INDEMNIFICATION.  DSI shall be responsible to perform its obligations under
this Agreement and to act in a reasonable and prudent manner with regard to this
escrow arrangement.  Provided DSI has acted in the manner stated in the
preceding sentence, Depositor and preferred Beneficiary each agree to indemnify,
defend and hold harmless DSI from any and all claims, actions, damages,
arbitration fees and expenses, costs, attorney's fees and other liabilities
incurred by DSI relating in any way to this escrow arrangement.

7.3  DISPUTE RESOLUTION.  Any dispute relating to or arising from this Agreement
shall be resolved by arbitration under the Commercial Rules of the American
Arbitration Association.  Unless otherwise agreed by Depositor and Preferred
Beneficiary, arbitration will take place in Boston, Massachusetts, USA.  Any
court having jurisdiction over the matter may enter judgment on the award of the
arbitrator(s).  Service of a petition to confirm the arbitration award may be
made by First Class mail or by commercial express mail, to the attorney for the
party or, if unrepresented, to the party at the last known business address.

7.4  CONTROLLING LAW.  This Agreement is to be governed and construed in
accordance with the laws of the Commonwealth of Massachusetts without regard to
its conflict of law provisions.

7.5  NOTICE OF REQUESTED ORDER.  If any party intends to obtain an order from
the arbitrator or any court of competent jurisdiction which may direct DSI to
take, or refrain from taking any action, that party shall:

     (a)  Give DSI at least two business days' prior notice of the hearing;

     (b)  Include in any such order that, as a precondition to DSI's obligation,
DSI be paid in full for any past due fees and be paid for the reasonable value
of the services to be rendered pursuant to such order; and

     (c)  Ensure that DSI not be required to deliver the original (as opposed to
a copy) of the Deposit Materials if DSI may need to retain the original in its
possession to fulfill any of its other escrow duties.

8.  GENERAL PROVISIONS

8.1  ENTIRE AGREEMENT.  This Agreement, which includes the Acceptance Form and
the Exhibits described herein, embodies the entire understanding among all of
the parties with respect to its subject matter and supersedes all previous
communications, representations or understandings, either oral or written.  DSI
is not a party to the License Agreement between Depositor and preferred
Beneficiary and has no knowledge of any of the terms or provisions of any such
License Agreement.  DSI's only obligations to Depositor or Preferred Beneficiary
are as set forth in this Agreement.  No amendment or modification of this
Agreement shall be valid or binding unless signed by all the parties hereto,
except that Appendix 1 need not be signed by DSI, Appendix 2 need not be signed
by preferred Beneficiary and the Acceptance Form need only be signed by the
parties identified therein.

8.2  NOTICES.  All notices, invoices, payments, deposits and other documents and
communications shall be given to the parties at the addresses specified in the
attached Appendix 3 and the Preferred Beneficiary Acceptance Form.  It shall e
the responsibility of the parties to notify each other as provided in this
Section in the event of a change of address.  The parties shall have the right
to rely on the last known address of the other parties.  Unless otherwise
provided in this Agreement, all documents and communications may be delivered by
First Class mail.

8.3  SEVERABILITY.  In the event any provision of this Agreement is found to be
invalid, voidable or unenforceable, the parties agree that unless it materially
affects the entire intent and purpose of this

                                      F-6
<PAGE>

agreement, such invalidity, voidability or unenforceability shall affect neither
the validity of this agreement nor the remaining provisions herein, and the
provision in question shall be deemed to be replaced with a valid and
enforceable provision most closely reflecting the intent and purpose of the
original provision.

8.4  SUCCESSORS.  This Agreement shall be binding upon and shall inure to the
benefit of the successors and assigns of the parties.  However, DSI shall have
no obligation in performing this Agreement to recognize any successor or assign
of Depositor or Preferred Beneficiary unless DSI receives clear, authoritative
and conclusive written evidence of the change of parties.

8.5  REGULATIONS.  Depositor and Preferred Beneficiary are responsible for and
warrant compliance with all applicable laws, rules and regulations, including
but nor limited to customs laws, import, export, and re-export laws and
government regulations of any country from or to which the Deposit Materials may
be delivered in accordance with the provisions of this Agreement.

SPEECHWORKS INTERNATIONAL, INC.       DSI TECHNOLOGY ESCROW
                                      SERVICES, INC.

By: _____________________________     By: _____________________________
Name: ___________________________     Name: ___________________________
Title: __________________________     Title: __________________________
Date: ___________________________     Date: ___________________________

                                      F-7
<PAGE>

                             PREFERRED BENEFICIARY
                                ACCEPTANCE FORM

Account Number ___________

Depositor, Preferred Beneficiary and DSI Technology Escrow Services, Inc.
("DSI"), hereby acknowledge that America Online, Inc. is the Preferred
Beneficiary referred to in the Master Preferred Escrow Agreement effective
______________, 20_____ with DSI as the escrow agent and SpeechWorks
International, Inc. as the Depositor.  Preferred Beneficiary hereby agrees to be
bound by all provisions of such Agreement.

Depositor hereby enrolls Preferred Beneficiary to the following account(s):
<TABLE>
<CAPTION>
Account Name                                 Account Number
<S>                                          <C>
---------------------------------------      -----------------------------------------
---------------------------------------      -----------------------------------------
---------------------------------------      -----------------------------------------

Notices and communications to Preferred      Invoices should be addressed to Preferred
Beneficiary should be addressed to:          Beneficiary at:

Company Name: America Online, Inc.           _________________________________________
Address:_______________________________      _________________________________________
        _______________________________      _________________________________________
        _______________________________      _________________________________________
Designated Contact:____________________      Contact:_________________________________
Telephone:_____________________________      _________________________________________
Facsimile:_____________________________      P.O. #, if required:_____________________

AMERICA ONLINE, INC.                         SPEECHWORKS INTERNATIONAL, INC.
Preferred Beneficiary

By:____________________________________      By:______________________________________
Name:__________________________________      Name:____________________________________
Title:_________________________________      Title:___________________________________
Date:__________________________________      Date:____________________________________

DSI Technology Escrow Services, Inc.

By:____________________________________
Name:__________________________________
Title:_________________________________
Date:__________________________________
</TABLE>

                                      F-8
<PAGE>

                                   APPENDIX 1
                           Materials to be Deposited

Account Number________________

Depositor represents to Preferred Beneficiary that Deposit Materials delivered
to DSI shall consist of the following:

<TABLE>
<CAPTION>
SPEECHWORKS INTERNATIONAL, INC.                     AMERICA ONLINE, INC.
<S>                                                 <C>

By:___________________________________________      By:_________________________________________
Name:_________________________________________      Name:_______________________________________
Title:________________________________________      Title:______________________________________
Date:_________________________________________      Date:_______________________________________
</TABLE>

                                      F-9
<PAGE>

                                   APPENDIX 2
                        DESCRIPTION OF DEPOSIT MATERIALS

Depositor:  SPEECHWORKS INTERNATIONAL, INC.

Account Number:_______________________________________________________________

Product Name:_______________________________________   Version________________
(Product Name will appear on Account History report)

DEPOSIT MATERIAL DESCRIPTION:

<TABLE>
<CAPTION>
Quantity      Media Type & Size          Label Description of Each Separate Item
                                         (Please use other side if additional space is needed)
<S>           <C>                        <C>
___________   Disk 3.5" or _____
___________   DAT tape ____ mm
___________   CD-ROM
___________   Data cartridge tape ___
___________   TK 70 or ____ tape
___________   Magnetic tape ____
___________   Documentation
___________   Other _________________
</TABLE>

PRODUCT DESCRIPTION

Operating System:______________________________________________________________
Hardware Platform:_____________________________________________________________

DEPOSIT COPYING INFORMATION

Is the media encrypted? Yes/No If yes, please include any passwords and the
decryption tools.
Encryption tool name:_______________________________________  Version__________
Hardware required:_____________________________________________________________
Software required:_____________________________________________________________

<TABLE>
<CAPTION>
I certify for DEPOSITOR that the above described    DSI has inspected and accepted the above materials
 Deposit Materials have been transmitted to DSI:    (any exceptions are noted above):
<S>                                                 <C>

Signature:_____________________________________     Signature:________________________________________
Print Name:____________________________________     Print Name:_______________________________________
Date:__________________________________________     Date Accepted:____________________________________
                                                    Appendix 2#:______________________________________
</TABLE>

Send materials to: DSI, 9265 Sky Park Court, #202, San Diego, CA 92123
(858) 499-1600

                                     F-10
<PAGE>

                                   APPENDIX 3
                               DESIGNATED CONTACT

Account Number____________

<TABLE>
<CAPTION>
Notices and communications should be addressed to:    Invoices should be addressed to Preferred
                                                      Beneficiary at:
<S>                                                   <C>
Company Name:  SpeechWorks International, Inc.        America Online, Inc.
Address:  695 Atlantic Avenue                         ___________________________________________
          Boston, MA  02111                           ___________________________________________
          ________________________________________    ___________________________________________
Designated Contact:   Corporate Counsel               Contact:___________________________________
Telephone:  617-428-4444                              ___________________________________________
Facsimile:  617-428-1122                              P.O. #, if required:_______________________
</TABLE>

Requests to change the designated contact should be given in writing by the
designated contact or an authorized employee.

<TABLE>
<CAPTION>
Contracts, Deposit Materials and notices to DSI     Invoice inquiries and fee remittances to DSI should
should be addressed to:                             be addressed to:

<S>                                                 <C>
DSI                                                 DSI
Contract Administration                             Accounts Receivable
Suite 202                                           Suite 1450
9265 Sky Park Court                                 425 California Street
San Diego, CA  92123                                San Francisco, CA  94104
Telephone: (858) 499-1600                           (415) 398-7900
Facsimile: (858) 694-1919                           (415) 398-7914

Date:____________________________________________
</TABLE>

                                     F-11
<PAGE>

                                   EXHIBIT G
                                   PUBLICITY

1.  In the event that the SpeechWorks Software is implemented on the AOL Voice
Portal, SpeechWorks will receive attribution in the AOL announcement of the
portal rollout, with specific language and positioning to be determined by AOL.
Inclusion of SpeechWorks in additional portal rollouts will be in AOL's
discretion.

2.  SpeechWorks my list AOL on its standard partner and/or customer lists.  Any
other use of AOL's name and logo not otherwise provided for in this Agreement
will be subject to the approval of AOL.

3.  AOL agrees to place a SpeechWorks logo on select web page(s) relevant to the
AOL Voice Portal, with the specific pages, placement and logo to be identified
by AOL in its discretion.  The design of such logo will be subject to
SpeechWorks approval.

4.  AOL will reasonably consider SpeechWorks specific requests to use the AOL
name and logo on appropriate marketing materials of SpeechWorks.

                                      G-1

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