Document:

Prepared by MERRILL CORPORATION

EXHIBIT 10.25  

[HEARME LETTERHEAD]  

September
10, 2001 

Joyce
Keshmiry

HearMe 

Dear
Joyce, 

    This
letter documents a decision made by the HearMe Board of Directors with regard to your compensation during this challenging period of shutting down the Company. The goal of the
Board of Directors is two-fold: 1) to retain you as the best person for the job of financially shutting down the Company in the hopes of providing the best possible return to the shareholders,
and 2) to provide you an incentive to maximize the return to shareholders. 

    You
will be entitles to an additional cash bonus (which will be subject to applicable taxes and withholding) to be paid from the total cash in excess of $1.5 Million available
for distribution to stockholders in connection with the liquidation of HearMe pursuant to Plan of Liquidation and Dissolution approved by the HearMe Board on August 10, 2001 (the
"Liquidation"), after all obligations of the Company are met (the "Distributable Excess Assets"). Your bonus will equal to 1% of the Distributable Excess Assets and payment of this bonus (or
proportionate amounts of this bonus) will be made to you at the same time distributions from the Distributable Excess Assets are made to the stockholders. If your employment terminates prior to any
distribution date related to the Liquidation under any circumstances other than the Company's terminating your employment without Cause, you will forfeit any portion of this bonus relating to
distributions following the final date of your employment. If the Company terminates your employment without Cause (including, but not limited to, in connection with the retention of a liquidation
management company or the transfer of the Company's assets to a liquidating trust), you will continue to be entitled to the proportionate amount of this bonus on each distribution date related to the
Liquidation. To the extent it is necessary to make
any determination as to the amount of the Distributable Excess Assets, the Board of Directors or its Compensation Committee will make such determination in good faith and such determination will be
binding upon you. 

    By
way of example, pursuant to the foregoing paragraph, if an aggregate of $5,000,000 were available for distribution to stockholders pursuant to the Liquidation, then (i) the
stockholders would receive the initial $1,500,000, (ii) the Distributable Excess Assets would equal $3,500,000, (iii) you would receive a bonus (less applicable withholding) of $35,000
and (iv) the stockholders would receive the remaining Distributable Excess Assets after payment of all similar bonus payments. 

    You
understand that your employment continues at all times to be on an at-will basis. 

    Joyce, I personally want to thank you for your commitment and dedication in your tasks. Throughout your time with HearMe you have consistently demonstrated that you have an eye for
detail and an ability to find creative solutions that suites you well for the challenges ahead. 

	Sincerely,	 	 	 	 
	

/s/ JAMES SCHMIDT   	
 	

 	
 	

 
	

James Schmidt

CEO	
 	

 	
 	

 
	

AGREED TO AND ACCEPTED:	
 	

 	
 	

 
	

/s/ JOYCE KESHMIRY   
 Joyce Keshmiry	
 	

9/10/01
 DatePrepared by MERRILL CORPORATION

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EXHIBIT 10.26  

June 19,
2001 

James
Schmidt

CTO

HearMe 

Dear
Jim, 

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

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

	•
	You
will be eligible to receive a retention bonus in the amount of $150,000 (less applicable taxes). To earn this retention bonus you must remain an
employee in good standing through November 30, 2001. The retention bonus will be paid on November 30, 2001, or earlier in the event HearMe is either acquired by another company (in which
case payment will be on the close of the transaction) or, if HearMe terminates your employment without "cause," on the last day of your employment.

	•
	You
have been granted an option to purchase 100,000 shares of HearMe common stock with an exercise price of $0.40 per share. This option was granted to you
on April 23, 2001. All of these options (100%) will vest on the earlier date of the closing date of the sale of the Company or February 28, 2002.

	•
	You
will be eligible for an extension of your exercise period for all vested options from the 90 days provided in your option agreement(s) to one
year following your termination of employment if you remain an employee in good standing through November 30, 2001. 

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

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

Thank
you for your continued support and hard work. 

Sincerely, 

Rob
Csongor

Chief Executive Officer 

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

	Signature:	 	  
	 	Date:	 	  

	

Name:	
 	

James Schmidt	
 	

 	
 	

 

 
 
 

EXHIBIT A
  HEARME    
  

 
  CHANGE OF CONTROL / RETENTION AGREEMENT    
  

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

 
 

RECITALS    
  

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

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

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

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

    The
parties hereto agree as follows: 

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

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

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

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

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

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

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

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

    (a)  Cause.  "Cause" for termination of the Employee's employment with the Company shall exist in the
event of (i) an act of personal dishonesty taken by the Employee in connection with his or her responsibilities as an employee and intended to result in substantial personal enrichment of the
Employee, (ii) Employee's being convicted of, or entering a plea of nolo contendre to, a felony, or (iii) a willful act by the Employee which constitutes misconduct and which is
injurious to the Company; or material violations of this Agreement, any other agreement between the Employee and the Company (including without limitation any confidentiality, proprietary information
and inventions assignment agreement(s)) or of Employer's written policies as set forth in Employer's employee handbook. In addition, "Cause" for termination of the Employee's employment shall exist,
whether or not the Company chooses to terminate his or her employment, such that the Employee's employment shall be deemed to have terminated for Cause, for purposes of this Agreement only, in the
event of the Employee's failure to devote his or her full time and attention, during normal business hours, to the business and affairs of the Company in a manner that meets or exceeds the Board's
performance expectations with respect to an officer holding the Employee's position, provided that in the event the Employee's performance falls below this level, 

3

 

the Company shall provide notice to the Employee of such performance shortfall and, if the shortfall is curable, the Employee shall have five (5) business days in which to cure the shortfall. 

    (b)  Change of Control.  "Change of Control" means the occurrence of any of the following events: 

     (i) Any
"person" (as such term is used in Sections 13(d) and 14(d) Section 13(d) of the Securities Exchange Act of 1934, as amended is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented
by the Company's then outstanding voting securities without the approval of the Board of Directors of the Company; or 

    (ii) A
merger or consolidation of the Company, whether or not approved by the Board of Directors of the Company, other than a merger or consolidation which would result
in holders of more than fifty percent (50%) of the voting power represented by the voting securities of the Company outstanding immediately prior thereto continuing to hold (either by the voting
securities remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the total voting power represented by the voting securities of
the Company, or such surviving entity outstanding immediately after such merger or consolidation, or the Company sells all or substantially all of the Company's assets. 

    (c)  Disability.  "Disability" shall mean that the Employee has been unable to perform his or her Company
duties as the result of his or her incapacity due to physical or mental illness, and such inability, at least 26 weeks after its commencement, is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Employee or the Employee's legal representative (such Agreement as to acceptability not to be unreasonably withheld). Termination
resulting from Disability may be effected only after at least 30 days' written notice by the Company of its intention to terminate the Employee's employment as a result of the Disability. In
the event that the Employee resumes the performance of substantially all of his or her duties hereunder before the termination of his or her employment becomes effective, the notice of intent to
terminate shall automatically be deemed to have been revoked. 

    8.  Successors.  

    (a)  Company's Successors.  Any successor to the Company (whether direct or indirect and whether by
purchase, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets shall assume the obligations under this Agreement and agree expressly to
perform the obligations under this Agreement in the same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes
under this Agreement, the term "Company" shall include any successor to the Company's business and/or assets which executes and delivers the assumption agreement described in this Section  7 8(a) or
which becomes bound by the terms of this Agreement by operation of law. 

    (b)  Employee's Successors.  The terms of this Agreement and all rights of the Employee hereunder shall
inure to the benefit of, and be enforceable by, the Employee's personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 

    9.  Miscellaneous Provisions.  

    (a)  Waiver.  No provision of this Agreement shall be modified, waived or discharged unless the
modification, waiver or discharge is agreed to in writing and signed by the Employee and by an authorized officer of the Company (other than the Employee). No waiver by either party of any breach of,
or of compliance with, any condition or provision of this Agreement by the other party 

4

 

shall be considered a waiver of any other condition or provision or of the same condition or provision at another time. 

    (b)  Whole Agreement.  No agreements, representations or understandings (whether oral or written and
whether express or implied) which are not expressly set forth in this Agreement have been made or entered into by either party with respect to the subject matter hereof. This Agreement represents the
entire understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior arrangements and understandings regarding same matter. This Agreement supercedes any
arrangements in any offer letters, addendums to offer letters or any other agreements. 

    (c)  Choice of Law.  The validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of California, with the exception of its conflict of laws provisions. 

    (d)  Severability.  The invalidity or unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect. 

    (e)  Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together will constitute one and the same instrument. 

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

	 	 	HEARME	 	 
	

 	
 	

By:	
 	

 	
 	

 
	

 	
 	

Title:	
 	

Chief Executive Officer
	

 	
 	

Date:	
 	

  
	
 	

, 2001
	

 	
 	

James Schmidt	
 	

 
	

 	
 	

Date:	
 	

  
	
 	

, 2001

5

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EXHIBIT A HEARME

CHANGE OF CONTROL / RETENTION AGREEMENT

RECITALS

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