Document:

020502 S3A Exhibit 10.2

EXHIBIT 10.2

 

LICENSE AGREEMENT

 

THIS AGREEMENT is made as of January 24, 2000 (the
"Effective Date") between 8x8, Inc., a corporation organized and
existing under the laws of the State of Delaware (hereafter "8x8"),
and ST Microelectronics, Inc., a corporation organized and existing under
the laws of the State of Delaware (hereafter "ST").

RECITALS

Whereas, ST is a global independent semiconductor company
which designs, develops, manufactures and markets a broad range of integrated
circuits and discrete devices based on semiconductors used in a wide variety of
microelectronic applications, including telecommunication systems, computer
systems, consumer products, automotive products and industrial automation and
control systems.

Whereas, 8x8 has expertise in the design, development, manufacturing and
marketing of products and technologies related to internet protocol telephony.

Whereas, ST desires to have access to
intellectual property rights owned or controlled by 8x8.

NOW, THEREFORE, in furtherance of the foregoing Recitals and in
consideration of the mutual covenants and obligations set forth in this
Agreement, the Parties agree as follows:

	Definitions

	Unless the provisions of this Agreement otherwise provide, the following
capitalized terms used in this Agreement shall have the meaning set out
below.

	Agreement shall mean the present license agreement, together with all
Appendixes hereto, as the same may be hereafter amended, modified or
supplemented from time to time.

	Affiliates shall mean an entity controlling, controlled by, or under
common control as of the Effective Date or thereafter during the term of this
Agreement, with ST or 8x8 as the case may be, provided that such entity shall be
considered an Affiliate only for the time during which such control exists.  For
purposes of this definition "control" shall mean ownership or control,
either directly or indirectly, of greater than 50% of the voting rights of such
entity.

	Confidential Information shall mean the terms
of this Agreement as well as any proprietary information and data of either
Party, contained in written or tangible form which is marked as "Internal
Use Only", "Proprietary", "Confidential", or similar
words. One Party's, including its Affiliates ("Disclosing Party")
Confidential Information shall also include its confidential information and
data orally disclosed to the other Party including its Affiliates
("Receiving Party") if related to written material marked as
confidential or otherwise identified as such during the course of the
discussions.  However, Confidential Information shall not include any data or
information which:

	Is or becomes publicly available through no fault of the Receiving
Party;
	Is already in the rightful possession of the Receiving Party prior to its
receipt of such data or information;
	Is independently developed by the Receiving Party without reference to the
Confidential Information of the Disclosing Party;
	Is rightfully obtained by the Receiving Party from a third party or in the
public domain;
	Is disclosed with the written consent of the Party whose information it is;
or
	Is disclosed pursuant to court order or other legal compulsion, after
providing prior notice to the Disclosing Party of the intended
disclosure.

	Closing Date shall mean the Closing Date as defined in the Common
Stock Purchase Agreement between 8x8 and STMicroelectronics NV of even date
herewith.

	Customers shall mean a third party who purchases Products from
Licensee.

	Deliverables shall have the meaning set forth in the Development
Agreement.

	Development Agreement shall mean that certain development agreement
executed on the same date herewith between the Parties.

	Derivative shall mean a product which is modified from a pre-existing
Product through a revision, translation, change in packaging, change in
semiconductor process technology or any other change that does not affect a
Product's form, fit and function.

	Essential Patents. Shall have the meaning set forth in Section 6.3
below.

	IP Rights shall mean all patents, patent applications, including with
respect to patents any patent rights granted upon any reissue, division,
continuation or continuation-in-part applications now or hereafter filed,
utility models issued or pending, registered and un-registered design rights,
copyrights (including the copyright on software in any code), trade secrets and
proprietary know-how, Mask Works and other similar statutory intellectual
property or industrial rights, as well as applications for any such rights.

	Licensee shall mean ST and its Affiliates.

	Licensed Technology shall have the meaning set forth in Exhibit 2 and
includes all IP Rights therein, now or hereafter owned or controlled by
8x8.

	Mask Works shall have the meanings set forth in section 901(a)(2) of
the Semiconductor Chip Protection Law(s).

	Net Sale Price means the actual amounts invoiced by the Licensee to
the Customers or authorized distributors less actual returns, packing charges,
shipping charges, taxes, duties, and price protection adjustments. Provided when
the Customer is a Licensee's authorized distributor, Net Sale Price means
Licensee's price to such distributor net of price protection adjustments and the
items referenced above. 

	Parties shall mean ST and 8x8 together.

	Party shall mean one of the Parties.

	Product shall mean one or more integrated circuits to be manufactured
by or for ST, using in whole or in part the Licensed Technology.

	Residual Information. means those portions of each Party's
Confidential Information as may be retained in the memory of the other Party's
and/or the other Party's Affiliates' employees, subcontractors, or sub-licensee
as the result of such employee, subcontractor, or sub-licensee being exposed to
such Confidential Information pursuant to and in accordance with the terms of
this Agreement. Residual Information shall not include information which has
been purposely committed to memory or documented, written, electronically stored
or otherwise stored in some other tangible form by or for such employee,
subcontractor or sub-licensee.

	Semiconductor Chip Protection Law(s) shall mean the semiconductor
Chip Protection Act of 1984 in the United States and any associated regulations
and any amendments or revisions to such law or regulations, or any corresponding
law and regulations in a country other than the United States.

	8x8 Software shall be as described in Exhibit 2

	Exhibits.  The exhibits hereto shall be taken, read and construed as
essential parts of this Agreement and are incorporated herein by reference.

	Headings.  The headings in this Agreement are inserted for
convenience of reference only and shall not be taken, read or construed as
essential parts of this Agreement.

	Plural.  Words applicable to natural persons include any body of
persons, company, corporation, firm or partnership, corporate or incorporate,
and vice versa. Words importing the masculine gender shall include the feminine
and neuter genders, and vice versa. Words importing the singular number shall
include the plural number, and vice versa.

	License

	Subject to the terms and conditions of this Agreement, 8x8 hereby grants
to the Licensee, under 8x8's IP Rights and to the extent that 8x8 is legally
entitled to grant rights thereto hereunder, a non-exclusive (except as set forth
in the Development Agreement), irrevocable, worldwide, non-transferable license
to use, operate, copy and modify, the Licensed Technology, to design, develop
and have developed Product, make, have made, commercialize, sell and otherwise
dispose of Product, and support and maintain such Product. This license includes
the right to combine and integrate 8x8 Software with other software, firmware or
programs.
	Subject to the terms and condition of this Agreement and in addition to the
rights granted in Section 2.1 above, 8x8 hereby grants to Licensee the right
to:

	distribute the 8x8 Software in object code form only and only for use on and
bundled with  Product or systems which contain the Product. 
	grant to its Customers a non-exclusive, non-assignable license to use the
appropriate 8x8 Software to develop Product. 

	In the event that a Customer wishes to license the 8x8 Software in source
code form, 8x8 agrees to negotiate in good faith on a case by case basis the
terms and conditions under which such a license may be provided.
	Except as otherwise provided under this Agreement, nothing herein entitles
the Licensee to distribute the Licensed Technology except in conjunction with a
Product.
	8x8 shall employ commercially reasonable efforts to deliver free of charge
to ST the relevant Licensed Technology in accordance to the schedule attached as
part of Exhibit 2.
	To the extent that 8x8 and ST have entered in an agreement under which 8x8
is to provide ST with maintenance and support for the Licensed Technology, such
support and maintenance will be as defined in Exhibit 1.
	8x8 agrees not to assert any of its IP Rights embodied in the Licensed
Technology against Licensee with respect to Licensee's use of such Licensed
Technology in accordance with the license rights and other terms of this
Agreement.
	In the event the Licensed Technology practices patents, patent applications,
including with respect to patents any patent rights granted upon any reissue,
division, continuation or continuation-in-part applications now or hereafter
filed ("Patents") by Licensee, Licensee agrees that it will not
assert these Patents against 8x8 provided, however, that Licensee would have not
been able to be aware of the infringement but for the disclosure of the Licensed
Technology hereunder. In any event this non-assert clause applies only in favor
of 8x8 and does not cover any third parties including customers or partners of
8x8. NOTWITHSTANDING ANYTHING TO THE CONTRARY, This non-assert clause is not
assignable and will automatically terminate in the event of a change of control
of 8X8. For purposes of this section, a change of control shall mean one
transaction or a series of related transactions that results in a change of
control through direct or indirect ownership of fifty percent (50%) or more of
the outstanding shares of stock entitled to vote for the election of directors
(other than restricted shares of stock).

	Training

	8x8 agrees to train the Licensee regarding the use and functionality of
the Licensed Technology. The number of employees subject to and the scope of
such training will be agreed upon by the Parties on a case-by-case
basis.

	Compensation

	In consideration for the license, delivery and services and support
provided by 8x8 under this Agreement, ST shall pay to 8x8 the royalties
described in Exhibit 3 which are applicable on the Net Sale Price of each
Product sold by Licensee during a quarter to a Customer or authorized
distributor (For the avoidance of doubt, Sale of Product to 8x8, and ST's
Affiliates are not subject to the royalties). Further, the Parties agree that
the royalty shall only fall due in respect of a Product in die or single die
packaged form and not in the overall price of a device into which a Product may
be integrated. Only the initial sale of a Product shall be subject to a royalty.
No royalty will accrue for any returns, warranty or other replacement. The
Parties agree that a Derivative shall be deemed the same Product and
consequently the royalty schedule will not reset for a Derivative sold by or for
Licensee.

	The royalties for the Product which is the subject matter of the Development
Agreement may be modified and replaced by the royalty schedule set forth in the
Development Agreement. In such a case, the royalty schedule described in the
Development Agreement will supersede and will not cumulate with the royalties
set forth in Exhibit 3 hereto.

	Royalty payment shall be made by ST to 8x8 within thirty (30) days of the
last day of each calendar quarter. All payments made hereunder shall be made in
United States currency, by wire transfer or other reasonable mutually agreed to
payment means and to such bank account(s) indicated by 8x8 in writing from time
to time.  Licensee will provide, concurrent with each payment, an explanation of
how the payment amount was calculated.
	Royalties described in Exhibit 3 are exclusive of applicable excise, sales,
use or other similar taxes, if any.
	Any income or other similar tax which ST is required by law to pay or
withhold on behalf of 8x8 with respect to any royalties payable to 8x8 under
this Agreement shall be deducted from the amount of such royalties otherwise
due, provided, however, that in regard to any such deduction, ST shall give 8x8
such reasonable assistance as may be necessary to enable or assist 8x8 to claim
exemption therefrom, or credit therefor, and shall upon request furnish to 8x8
such certificates and other evidence of deduction and payment thereof as 8x8 may
properly require.
	8x8 shall have the right for representatives of a firm of independent
accountants who shall have signed an appropriate non disclosure agreement, to
which ST shall not unreasonably object ("Auditors"), to make an examination
and audit, by prior appointment agreed between the Parties, such agreement not
to be unreasonably withheld, during normal business hours, not more frequently
than once annually during the time ST is required to make royalty payments to
8x8 hereunder and for one year thereafter, of all records and accounts as may
under recognized accounting practices contain information bearing upon the 8x8
royalties revenue and the number of Products sold by ST under this Agreement.
The Auditors will report to 8x8 only upon whether the royalties paid to 8x8 by
ST were or were not correct, and if incorrect, what are the correct amounts for
the royalties. ST shall be supplied with a copy of or sufficient extracts from
any report prepared by the Auditors. The Auditors shall (in the absence of
clerical or manifest error) be final and binding on the Parties. Such audit
shall be at 8x8's expense unless it reveals an underpayment of royalties of five
percent (5%) or more in which case ST shall reimburse 8x8 for the costs of such
audit, plus interest of 12% per annum on the deficiency from the time the
royalty was due until paid.

	Representations and Warranties

	8x8 represents and warrants to ST that (a) to the best of its knowledge
as of the Effective Date it has full power and authority to enter into this
Agreement, (b) to the best of its knowledge as of the Effective Date the terms
and conditions of this Agreement, and 8x8's obligations hereunder, do not
conflict with or violate any terms or conditions of any other agreement or
commitment to which 8x8 is a signatory or by which it is bound, (c) to the best
of its knowledge as of the Effective Date it owned or controlled the Licensed
Technology that will be licensed and delivered to Licensee under this Agreement
and (d) it will defend and indemnify Licensee against any third party claims
arising out of or related to a breach of these warranties and
representations.
	8x8 shall use its best efforts to verify the completeness of the Licensed
Technology delivered to Licensee hereunder. In the case there should be any
mistake or omission in such Licensed Technology, 8x8 shall promptly support ST
with corrected Licensed Technology, free of charge. 
	EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, 8x8 MAKES NO WARRANTIES OR
CONDITIONS, EXPRESSED, STATUTORY, IMPLIED, OR OTHERWISE, WITH RESPECT TO THE
LICENSED TECHNOLOGY LICENSED HEREUNDER, AND 8x8 HEREBY DISCLAIMS THE IMPLIED
WARRANTIES AND CONDITIONS OF, SATISFACTORY QUALITY, MERCHANTABILITY AND FITNESS
FOR A PARTICULAR PURPOSE WITH RESPECT THERETO.

	Indemnification

	Excluding claims asserting that the Licensed Technology infringes an
Essential Patent as defined below in Section 6.3, and subject to Section 9
(Limitation of Liability), 8x8 shall indemnify and hold Licensee and their
respective officers, directors, employees and agents (hereafter referred
individually or collectively as "Licensee Indemnitees") harmless and
shall pay all costs, damages, and reasonable attorneys' fees and expenses
relating to Licensee Indemnitees defense resulting from any suit, claim, demand,
or other action by a third party against Licensee Indemnitees based upon a
finding that any Licensed Technology infringes the IP Rights of a third party
("Licensee Infringement Claim"), provided that: (i) Licensee gives
written notice to 8x8 within ten (10) business days of notice of such Licensee
Infringement Claim; (ii) ST allows 8x8 at its expense through attorneys of its
own choice, to exclusively defend or control the defense of any Licensee
Infringement Claim; and (iii) Licensee assists 8x8 in all reasonable aspects in
such investigation and defense, and is reimbursed by 8x8 for all the reasonable
costs incurred in collaborating in such investigation and defense.  The
foregoing indemnity obligations shall specifically not apply to any claim
excluded under Section 6.2 or 6.3 below.  If, as a result of a Licensee
Infringement Claim, Licensee Indemnitees are enjoined from using the Licensed
Technology, or selling Products, 8x8 may in its sole discretion, (i) procure for
Licensee Indemnitees the right to use the Licensed Technology under the same
terms and conditions set forth in this Section 6.1 or (ii) provide Licensee
Indemnitees with modified Licensed Technology that are non-infringing while
still meeting substantially the same functional specifications as the Licensed
Technology.
	8x8 shall have no obligation under Section 6.1 above for any Licensee
Infringement Claim which results from: (a) the combination of a Product
with other products if the Licensee Infringement would have not existed but for
the combination; (b) the modification of the Licensed Technology by parties
other than 8x8 (or not authorized by 8x8); (c) the Improvement (as defined
in Exhibit 2 below) of the Licensed Technology by or for ST.

	Essential Patents.  Licensee acknowledges that the licenses granted
herein to the Licensed Technology do not include third party patents, copyrights
and trade secrets, that may be essential to the implementation of any industry
standard functions realized by the Licensed Technology including but not limited
to H.323, SIP, MGCP, G.711, G.722, G.723, G.726, G.728, G.729AB/E and V.17,
V.27, and V.29 ("Essential Patents"). 
	SECTION 6.1  STATES THE ENTIRE LIABILITY OF 8x8 AND THE EXCLUSIVE REMEDY OF
ST WITH RESPECT TO ANY AND ALL INFRINGEMENT CLAIMS.  EXCEPT AS EXPRESSLY STATED
IN THIS SECTION, ALL WARRANTIES OF NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY
RIGHTS ARE HEREBY DISCLAIMED BY 8x8.

	Term and Termination

	This Agreement shall become effective upon the Closing Date and shall
continue unless terminated as herein provided. 
	This Agreement may be terminated by either Party upon notice if the other
Party (i) breaches any material term or condition of this Agreement and fails to
remedy the breach within thirty (30) days after being given notice thereof, (ii)
becomes the subject of any voluntary or involuntary proceeding under the
applicable national or state bankruptcy or insolvency laws and such proceeding
is not terminated within sixty (60) days of its commencement.
	In the event of termination of this Agreement for breach or bankruptcy as
provided herein, the license rights of the non-terminated Party pursuant to
Section 2 above shall survive such termination, and the license rights of the
terminated Party pursuant to Section 2 above shall survive only to the extent
required to protect the interest of existing, committed customers of the
terminated Party, and in particular the terminated Party shall have the right to
(i) complete and sell or otherwise dispose of any work-in-progress existing in
its manufacturing plants at the time of termination, (ii) sell and otherwise
dispose of any Product in stock, (iii) complete any orders for Product existing
at the time of termination and (iv) continue to provide technical support to its
customers.
	Notwithstanding anything to the contrary herein, no expiration or
termination of this Agreement shall diminish the rights of any customer who has
purchased Product to continue to use and/or sell or otherwise dispose of the
same.
	 Notwithstanding anything to the contrary herein, no expiration or
termination of this Agreement shall relieve Licensee of its obligation to pay
any sum due hereunder.
	The provisions of Sections 1 ("Definitions"), 2
("License") except for (a) Licensee's right to design, develop and
have developed new Product if the termination is caused by Licensee's material
breach, and (b) sub-section 2.7 if the termination is caused by 8x8's material
breach, 3 ("Compensation"), 4 ("Representations and
Warranties"),  6 ("Indemnification"), 7 ("Term and
Termination"), 8 ("Confidentiality"), 9 ("Limitation of
Liability") and 10 ("General Provisions") shall survive any
termination of this Agreement.

	Confidentiality

	The Receiving Party shall, during the term of the Agreement, and for a
period of five (5) years thereafter, subject to the exclusions set forth in
Section 1.1.3 ("Confidential Information"), hold all Confidential
Information of the Disclosing Party in confidence, not disclose such
Confidential Information to any third parties except those with a need to know
in connection with or during the performance of this Agreement (including, as
necessary, subcontractors) who have executed a confidentiality agreement with
terms at least as restrictive with regard to the Disclosing Party's information
as those set forth herein, and in general use the same degree of care to protect
the confidentiality of the Disclosing Party's Confidential Information as it
uses with respect to its own information of a similar nature. 
	Neither 8x8 nor Licensee shall use the other Party's Confidential
Information for another or other purpose than for the purposes set forth in this
Agreement.
	Except as otherwise provided in Section 7.3 above, upon termination of this
Agreement all of the Disclosing Party's Confidential Information and all copies
thereof in the Receiving Party's possession or control shall be immediately
returned to the Disclosing Party or destroyed by the Receiving Party at the
Disclosing Party's instruction. The Receiving Party shall then certify the same
in writing and that no copies have been retained by the Receiving Party, its
employees, Affiliates, contractors, or other parties to whom such information is
provided.
	The Receiving Party acknowledges that the unauthorized disclosure of the
Disclosing Party Confidential Information will cause irreparable harm and
significant injury, the scope of which is difficult to ascertain. Accordingly,
the Receiving Party agrees that the Disclosing Party shall have the right to an
immediate injunction enjoining any such unauthorized disclosure.
	Both Parties agree not to assert claims against the other Party and/or their
employees, subcontractor or sub-licensee based on inadvertent or unintentional
use of any Residual Information by the Party, their employees, subcontractor, or
sub-licensee. Further, neither Party shall  be restricted from carrying out
independent development in which such Residual Information is inadvertently or
unintentionally used. This Section shall not be construed to convey any patent
or copyright of either Party.

	Limitation of Liability 

	EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, IN NO EVENT SHALL
EITHER PARTY BE LIABLE TO THE OTHER OR TO ANY THIRD PARTY FOR ANY SPECIAL,
INDIRECT, PUNITIVE, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT
LIMITATION, LOSS OF PROFITS), CAUSED BY ANY BREACH OF ITS OBLIGATIONS TO THE
OTHER ARISING OUT OF OR RELATING TO THIS AGREEMENT, REGARDLESS OF THE FORM OF
ACTION, WHETHER IN CONTRACT OR IN TORT, EVEN IF THE BREACHING PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
	IN NO EVENT SHALL THE TOTAL LIABILITY OF 8x8 TO ST ARISING UNDER SECTION 6
"INDEMNIFICATION" HEREOF EXCEED THE TOTAL AMOUNT PAID BY ST TO 8x8
WITH RESPECT TO THE 8X8 BASED PRODUCT(S) CONTAINING THE IP RIGHTS SUBJECT MATTER
OF THE CLAIM, PROVIDED THAT SUCH TOTAL AMOUNT SHALL NOT EXCEED FOUR MILLION U.S.
DOLLARS ($4,000,000). 
	IN NO EVENT SHALL THE TOTAL LIABILITY OF EITHER PARTY TO THE OTHER PARTY FOR
ANY LOSS, DAMAGE OR LIABILITY ARISING FROM A BREACH OF THIS AGREEMENT, THE
DEVELOPMENT AGREEMENT OR BOTH EXCEED A SUM OF TWO MILLION DOLLARS ($2,000,000)
PROVIDED THAT SUCH LIMIT SHALL NOT APPLY IN THE EVENT OF A WILLFUL MISUSE OR
WILLFULLY UNLAWFUL DISTRIBUTION OF THE LICENSED TECHNOLOGY, AND PROVIDED THAT
FOR ST SUCH LIMITATION SHALL NOT APPLY IN THE EVENT THAT ST FAILS TO PAY THE
ROYALTIES AND THE NRE EARNED BY 8X8 AND DUE BY ST AS SET FORTH IN SECTION 8 OF
THE DEVELOPMENT AGREEMENT.

	General Provisions

	Assignment. This Agreement may not be assigned by either Party, nor any
of such Party's rights or obligations hereunder, to any third party including
without limitation through a U.S. Bankruptcy Code Chapter 11 reorganization,
without prior written consent of the other Party (which shall not be
unreasonably withheld). In the event that this Agreement is assigned effectively
to a third party, this Agreement shall bind upon successors and assigns of the
Parties hereto. Notwithstanding the foregoing, either Party may assign this
Agreement to an Affiliate provided that the assigning Party so notifies the non-
assigning Party in writing and the assignee agrees to assume all of the
obligations of the assigning Party under this Agreement.  In the event that the
assignee ceases to be an Affiliate, this Agreement will immediately be re-
assigned to ST and ST will assume all obligations under this Agreement.

	Affiliates. Both Parties acknowledge that the other party may or does
conduct its business in whole or in part through Affiliates. Accordingly, both
Parties agree that the rights and benefits granted to the other Party through
this Agreement shall inure to the other Party and its Affiliates.

	Force Majeure. Neither Party shall be liable to the other
Party for failure of or delay in performance of any obligation under this
Agreement, directly or indirectly, owing to acts of God, war, war-like
condition, embargoes, riots, strike and other events beyond its reasonable
control. In the event that such failure or delay occurs, the affected Party
shall notify the other Party of the occurrence thereof as soon as possible and
the Parties shall discuss the best way to resolve the event of force
majeure.

	Notices.  All notices provided for in connection with this Agreement
shall be given in writing and shall be effective (i) upon receipt, when
served by personal delivery; or (ii) the next day following the date of
transmittal when transmitted by facsimile; or (iii) on the third day
following the date of  transmittal when transmitted by express mail; or
(iv) on the 7th day following the date of mailing when sent by registered
airmail of the sender's country with postage prepaid, addressed to the Party as
follows, or to a changed address as the Party shall have specified by prior
written notice:

ST:  ST Microelectronics, Inc. at 1310 Electronics Drive Carrolton, TX 75006
USA. Attention: General Counsel; and

8x8:   8x8, Inc. 2445 Mission College Blvd. Santa Clara, California 95054
Attention: Chief Financial Officer.

	Waiver.  The waiver by either Party of the remedy for the other
Party's breach of or its right under this Agreement will not constitute a waiver
of the remedy for any other similar or subsequent breach or right.

	Severability.  If any provision of this Agreement is or becomes, at
any time or for any reason, unenforceable or invalid, no other provision of this
Agreement shall be affected thereby, and the remaining provisions of this
Agreement shall continue with the same force and effect as if such unenforceable
or invalid provisions had not been inserted in this Agreement.

	Press Release and Sales Documentation. Neither Party shall make any
announcement or press release regarding this Agreement or any terms thereof
without the other Party's prior written consent. However,
either party is free to file with the SEC or other relevant government agencies
any document required to be filed thereon advice of counsel (redacted in a form
advised by counsel). Furthermore, in accordance with the guidelines to be
provided by 8x8 and with 8x8 prior approval which shall not be unreasonably
withheld, 8x8 authorizes ST to use the name, trademark or logo "8x8"
in its marketing and sales documentation.
	Amendment.  No changes, modifications or
alterations to this Agreement shall be valid unless reduced to writing and duly
signed by the respective authorized representative of each Party.

	Governing Law.  This Agreement shall be interpreted, construed and
enforced in accordance with the laws of the State of California without respect
to its conflict of law provisions.

	No Partnership. In giving effect to this Agreement, no Party shall be
or be deemed to be an agent or employee of another Party for any purpose, and
that their relationship to each other shall be that of independent contractors.
Nothing in this Agreement shall constitute a partnership or a joint venture
between the Parties. No Party shall have the right to enter into contracts or
pledge the credit of or incur expenses or liability on behalf of the other
Party.

	Entire Agreement.  This Agreement and the Development
Agreement constitute the entire agreement between the Parties and supersede all
prior proposal(s) and discussions relative to the subject matter of this
Agreement and neither of the Parties shall be bound by any conditions,
definitions, warranties, understandings or representations with respect to the
subject matter other than as expressly provided herein. The terms and conditions
contained herein and the appendixes attached hereto constitute the entire
agreement between the parties and shall supersede all previous communications
either oral or written between the parties with respect to the subject matter
hereof. No oral explanation or oral information by either party hereto shall
alter the meaning or interpretation of this Agreement.

IN WITNESS THEREOF, the Parties hereto have executed this Agreement on
the Effective Date.

	
For ST Microelectronics, Inc.:
	
For 8x8, Inc.

	
Name:    A.McK. Malone
	
	
Name:    Paul Voois
	

	
Title:    Executive Vice President and CFO
	
	
Title:    Chairman and CEO
	

	
Signature: /s/    A. McK. Malone
	
	
Signature: /s/    Paul Voois
	

 

EXHIBIT 1

Maintenance and Support Policy

Maintenance and support that is to be provided hereunder is as described
below:

	8x8 will provide ST with bug fixes, modifications, updates and incremental
enhancements that are incorporated into any Licensed Technology releases made
generally available during the active maintenance period to 8x8's customers
under similar maintenance agreements.  If and when such releases are made
available to any 8x8 customer, 8x8 shall also inform ST of their existence,
prepare and make available the releases to ST, without additional charge.
	8x8 will provide ST with Improvements that are developed specifically for ST
when available and as agreed to in the SOW.
	8x8 will provide ST with reasonable technical support through 8x8's
Application Engineering group, to assist ST to develop Product. Such support and
response times will be consistent to that which 8x8 provides other customers
under standard maintenance agreements and will be rendered from 8x8's Santa
Clara, CA facility.
	ST will report errors to 8x8 by Email.  8x8 will apply reasonable effort to
duplicate the reported error and identify any appropriate bug fixes or
modifications.
	The Parties will mutually determine the priority of an error and 8x8 will
use commercially reasonable efforts to respond to ST within time frames
consistent with the error priority and consistent to response times 8x8 provides
other customers under standard maintenance agreements with similar priority
errors.
	If ST asks 8x8 for engineers or others to travel to ST's locations to
support the Licensed Technology, and 8x8 agrees to do so (such agreement shall
not be unreasonably withheld), ST and 8x8 will agree as to which Party will pay
the reasonable costs associated therewith, including the labor costs for such
personnel, travel, meals and lodging costs.

Maintenance Fees

The fee payable by ST to 8x8 for the maintenance and support described
herein is as defined in the relevant Development Agreement Exhibits.  Otherwise,
to the extent that the Licensed Technology is used by ST in Products not
associated with the Development Agreement, if any, an additional maintenance fee
payable by ST to 8x8 will be applicable and will be negotiated by the Parties in
good faith on a case by case basis.

EXHIBIT 2

Licensed Technology

The Licensed Technology to be made available hereunder consists of the
following:

	The 8x8 Software and the 8x8 DSP as described below, as they exist on the
Effective Date or upon delivery.
	The Deliverables, upon delivery.
	All updates, new releases and new versions, enhancements, modifications,
adaptations, translations, additions and derivative works (collectively referred
to as "Improvement") of items 1 and 2 that are to be provided by 8x8,
as agreed to under the Development Agreement if and when available and upon
delivery.
	All updates, new releases and new versions, enhancements, modifications,
adaptations, translations, additions and derivative works of items 1 that are
made available to 8x8 customers who are under similar maintenance and support
agreements as shown in Exhibit 1 within one (1) year of the Effective
Date, if and when available and upon delivery.

 

Specifically excluded from the Licensed Technology is 8x8's
Intraswitch hosted iPBX technology, 8x8's end point system level products and
related technology and any modifications or enhancements to the Licensed
Technology developed by 8x8 for a third party.

8x8 Software

The 8x8 Software incorporates the Call Code and the Audio Code as defined
below.  The 8x8 software shall include the applicable software or firmware owned
or controlled by 8x8, in source code and object code format, applicable manuals,
program description, design and implementation documentation and other related
documentation.

The Call Code to be provided hereunder is in ANSI C and POSIX operating
system compliant format or in a format as agreed to in the Development
Agreement.

The Audio Code to be provided hereunder is 8x8 DSP firmware consisting of a
mixture of 8x8 DSP assembly language and C or in a format as agreed to in the
Development Agreement.

In addition to the Call Code and Audio Code described below, the 8x8 Software
to be provided hereunder shall include any other embedded voice over internet
protocol firmware functions controlled by 8x8 that, as mutually agreed to by the
Parties, is essential to a Product associated with a Development Agreement.

	
Call Code

	
Function
	
Estimated Availability Date

	
Call control applications
	
1Q00

	
MGCP (NCS 1.0) compliant call stacks
	
1Q00

	
SIP (RFC 2543)
	
3Q00

	
H.323V2 with H.245
	
1Q00

	
H.323V2 Annex F variant (pending ratification of standard)
	
2Q00

	
ASN.1 (included in H.323)
	
1Q00

	
RTP/RTCP
	
1Q00

	
POSIX OS and C library
	
1Q00

	
Audio I/F drivers
	
1Q00

	
DSP device drivers
	
1Q00

	
HTTP Webserver
	
1Q00

	
SNMP
	
3Q00

	
DNS/DHCP
	
1Q00

	
BOOTP/TFTP
	
1Q00

 

	
Audio Code

	
Function
	
Estimated Availability Date

	
G.711
	
1Q00

	
G.722
	
1Q00

	
G.723.1 including Annex A
	
1Q00

	
G.726
	
1Q00

	
G.728
	
1Q00

	
G.729AB
	
1Q00

	
G.729E
	
1Q00

	
V.17, V.27, V.29 for T.38
	
3Q00

	
V.8/modem tone detection
	
3Q00

	
Acoustic echo cancellation
	
1Q00

	
G.165/G.168
	
1Q00

	
DTMF and other tone generation/detection
	
1Q00

	
AGC
	
1Q00

	
Comfort noise generation
	
1Q00

	
Silence suppression
	
1Q00

	 	 

 

8x8 DSP

The 8x8 DSP is defined as the 8x8 VP7 DSP core with mutually agreed to
modifications.  The availability date will be as mutually agreed to.  The 8x8
DSP information to be provided to ST will be sufficient to enable ST to
implement a gate level version with which ST can perform layout, extract pre and
post layout timing information for simulation and verification, integrate with
other circuitry and fabricate prototypes and production units and includes the
8x8 DSP Design Kit which is defined as:  the 8x8 DSP Verilog HDL RTL and
behavioral description; any other applicable high-level models, behavior models,
C-models, Verilog models, timing models; validation and test program
vectors/simulation patterns; firmware development tools (assembler, linker and
other utilities) and documentation relating to these items to the extent
presently available and in its existing form

 

EXHIBIT 3

Royalties

Royalty Schedule

 

 

	
8x8 Intellectual Property
	
Per unit of Product for the first 1M unit of Products
Licensee ships to Customers (As a percentage of the Net Sale Price)
	
Per unit of Product after Licensee has shipped 1M unit of
Products to Customers (As a percentage of the Net Sale Price)

	
Call Code
	
3.0%
	
2.0%

	
Audio Code
	
3.0%
	
2.0%

	
8x8 DSP
	
2.0%
	
1.5%

The royalty schedule will reset for each Product

Note:

8x8 DSP royalty applies per Product regardless of the number of 8x8 DSP cores
per Product.020502 S3A Exhibit 10.3

EXHIBIT 10.3

 

 

DEVELOPMENT AGREEMENT

THIS AGREEMENT is made as of January 24, 2000 (the "Effective
Date") between 8x8, Inc., a corporation organized and existing under
the laws of the State of Delaware (hereafter "8x8"), and ST
Microelectronics, Inc., a corporation organized and existing under the laws
of the State of Delaware (hereafter "ST").

RECITALS

Whereas, ST is a global independent semiconductor company
which designs, develops, manufactures and markets a broad range integrated
circuits and discrete devices based on semiconductors used in a wide variety of
microelectronic applications, including telecommunication systems, computer
systems, consumer products, automotive products and industrial automation and
control systems.

Whereas, 8x8 has expertise in the design, development, manufacturing and
marketing of products and technologies related to internet protocol telephony.

Whereas, ST and 8x8 have entered on January 24, 2000 in a certain equity
investment agreement and a certain license agreement.

Whereas, ST desires to collaborate with 8x8 to design and develop products
that enable voice and other multimedia services over internet protocol
networks.

NOW, THEREFORE, in furtherance of the foregoing Recitals and in consideration
of the mutual covenants and obligations set forth in this Agreement, the Parties
agree as follows:

	Definitions

	Unless the provisions of this Agreement otherwise provide, the following
capitalized terms used in this Agreement shall have the meaning set out
below.

	8x8 DSP shall have the meaning set forth in the License
Agreement.

	Agreement shall mean the present development agreement, together with
all Exhibits hereto, as the same may be hereafter amended, modified or
supplemented from time to time.

	Affiliates shall mean an entity controlling, controlled by, or under
common control as of the Effective Date or thereafter during the term of this
Agreement, with ST or 8x8 as the case may be, provided that such entity shall be
considered an Affiliate only for the time during which such control exists.  For
purposes of this definition "control" shall mean ownership or control,
either directly or indirectly, of greater than 50% of the voting rights of such
entity.
	Audio Code  is described in Exhibit 2 of the
License Agreement.

	Call Code is described in Exhibit 2 of the License Agreement.

	Completion unless otherwise agreed to by the Parties in the SOW,
shall mean the completion of Phase Three as set forth in Section 2.4.3 below or
a date two (2) years after the date of Project Acceptance (in the case of the
MTA-1 Project, the Effective Date) whichever is earlier.

	Confidential Information shall mean the terms of this Agreement as
well as any proprietary information and data of either Party, contained in
written or tangible form which is marked as "Internal Use Only",
"Proprietary", "Confidential", or similar words. One
Party's, including its Affiliates ("Disclosing Party") Confidential
Information shall also include its confidential information and data orally
disclosed to the other Party including its Affiliates ("Receiving
Party") if related to written material marked as confidential or otherwise
identified as such during the course of the discussions.  However, Confidential
Information shall not include any data or information which:

	Is or becomes publicly available through no fault of the Receiving
Party;
	Is already in the rightful possession of the Receiving Party prior to its
receipt of such data or information;
	Is independently developed by the Receiving Party without reference to the
Confidential Information of the Disclosing Party;
	Is rightfully obtained by the Receiving Party from a third party or in the
public domain;
	Is disclosed with the written consent of the Party whose information it is;
or
	Is disclosed pursuant to court order or other legal compulsion, after
providing prior notice to the Disclosing Party of the intended disclosure.

	Closing Date shall mean the Closing Date as defined in the
Common Stock Purchase Agreement between 8x8 and STMicroelectronics NV of even
date herewith.

	Customers shall mean a third party who purchases Products from
Licensee.

	Deliverables shall mean any Project and the results thereof including
but not limited to design and information related thereto, technical
descriptions, comments and related materials, applicable Licensed Technology,
components or other item including the IP Rights herein developed or to be
developed by a Party pursuant to a Project.

	Exclusive Market shall be as described in Exhibit 6 as it relates to
a Project.
	 Exhibits shall mean the exhibits 1 to 6 that are part of the
Agreement.

	Existing Technology shall mean that portion of the Licensed
Technology either currently owned or hereafter developed by of for 8x8
independent of a Project and other 8x8 IP Rights either currently owned or
hereafter developed by 8x8 that are not applicable to this Agreement or the
License Agreement. 

	Fees shall mean the support and maintenance fee set forth in Exhibit
1. 

	MTA-1 Project shall mean that Project described in the agreed upon
Project Plan set forth in Exhibit 2 ("Project Plan for the MTA-1
Project"), which shall be developed by the Parties pursuant to the SOW set
forth in Exhibit 3 ("Statement of Work for the MTA-1
Project").

	IP Rights shall mean all patents, patent applications, including with
respect to patents any patent rights granted upon any reissue, division,
continuation or continuation-in-part applications now or hereafter filed,
utility models issued or pending, registered and un-registered design rights,
copyrights (including the copyright on software in any code), trade secrets and
proprietary know-how, Mask Works and other similar statutory intellectual
property or industrial rights, as well as applications for any such rights.

	License Agreement shall mean that certain license agreement executed
on the same date herewith between the Parties.

	Licensed Technology shall have the meaning set forth in the License
Agreement.

	Mask Works shall have the meanings set forth in section 901(a)(2) of
the Semiconductor Chip Protection Law(s).

	Net sale Price means the actual amounts invoiced by the Licensee to
the Customers or authorized distributors less actual returns, packing charges,
shipping charges, taxes, duties, and price protection adjustments. Provided when
the Customer is a Licensee's authorized distributor, Net Sale Price means
Licensee's price to such distributor net of price protection adjustments and the
items referenced above.

	Ordinary Course Technology shall mean those portions of the Licensed
Technology that 8x8 would have developed in its normal course of business
irrespective of the relevant Project, including but not limited to such efforts
as required to ensure that the Licensed Technology maintains compatibility with
industry standards.

	Parties  shall mean ST and 8x8 together.

	Party shall mean one of the Parties.

	8x8 Based Product shall mean one or more integrated circuits to be
manufactured by or for ST, using in whole or in part the Licensed Technology, to
be designed and developed jointly by the Parties pursuant to a Project.

	 Project shall mean specific joint design and development activities
and an associated Project Plan, provided the Parties have Project
Acceptance.

	Project Plan shall mean the plan under which an associated Project
would proceed and which shall include each of the elements set forth in Section
2.4.1 below.  Each Project Plan will require the drafting and completion of new
Exhibits associated with the Project to be undertaken.

	Semiconductor Chip Protection Law(s) shall mean the semiconductor
Chip Protection Act of 1984 in the United States and any associated regulations
and any amendments or revisions to such law or regulations, or any corresponding
law and regulations in a country other than the United States.

	Statement of Work ("SOW") shall mean with respect to each
Project, the description of work which shall define the responsibilities of the
Parties in the design and development of the 8x8 Based Product including but not
limited to performance and functional goals, cost sharing, milestones and,
without limitation, similar items to those items included in Exhibit 3
("Statement of Work for the MTA-1 Project").

	ST Technology shall mean the technology owned or controlled by ST and
further described in Exhibit 4.

	Exhibits.  The Exhibits hereto shall be taken, read and construed as
essential parts of this Agreement and are incorporated herein by reference.

	Headings.  The headings in this Agreement are inserted for
convenience of reference only and shall not be taken, read or construed as
essential parts of this Agreement.

	Plural.  Words applicable to natural persons include any body of
persons, company, corporation, firm or partnership, corporate or incorporate,
and vice versa. Words importing the masculine gender shall include the feminine
and neuter genders, and vice versa. Words importing the singular number shall
include the plural number, and vice versa.
	Joint Development

	8x8's Responsibilities.  8x8 will undertake those development activities
for which 8x8 is responsible in accordance with the terms of any SOW associated
with a Project and in accordance with the terms hereof.   

	ST's Responsibilities.  ST will undertake those development
activities for which ST is responsible in accordance with the terms of any SOW
associated with a Project and in accordance with the terms hereof.  

	Joint Development Responsibilities.  The Parties will work together
to perform, pursuant to the SOW(s), the engineering tasks required in connection
with development of the 8x8 Based Product(s).  In this regard, each of the
Parties shall use commercially reasonable efforts to meet each milestone set
forth in milestone schedules delineated in the relevant SOW(s) to the
satisfaction of both Parties.  In order to ensure the timely completion of each
Project, the Parties will assign such personnel, facilities and resources as are
necessary to accomplish the development activities according to the terms of the
relevant Project Plan and associated SOW. 

	Project Stages.  Other than the MTA-1 Project and the ST120 Project,
for which the Parties have agreed to proceed in accordance with the Project Plan
set forth in Exhibit 2 ("Project Plan for the MTA-1 Project" and
"Project Plan for the ST120 Project"), the Parties are under no
obligation to initiate any projects.  However, once the Parties have agreement,
in writing, to proceed in accordance with an associated Project Plan
("Project Acceptance"), such project shall be deemed a Project and
shall proceed accordingly. No discussions shall become a "Project" nor a
binding obligation on either Party, until and unless the Parties have agreement,
in writing, to proceed in accordance with an associated Project Plan. Each
Project shall include the following three (3) phases:

	Phase One.  The Project Planning Phase.  During the Project Planning
Phase the Parties shall develop a Project plan which will include the following
items:

	Identification of 8x8 IP and ST IP
	Definition of the 8x8 Based Product to be designed and developed;
	Statement of Work;
	Joint marketing and sales program for the 8x8 Based Product, if applicable;
and

(e) Project specifications.

	Phase Two.  The Design and Development Phase.  During the Design and
Development Phase, the Parties shall commence the design and development of the
8x8 Based Product pursuant to the terms of the associated SOW.  During this
Phase ST will fabricate engineering samples of the 8x8 Based Product in
accordance with the agreed-upon specifications.

	Phase Three.  The Validation Phase.  During the Validation Phase, the
Parties will produce the following Deliverables relative to the 8x8 Based
Product pursuant to the terms of the associated SOW: 

	Perform field test and interoperability tests;
	Develop customer support parameters;
	Qualify the 8x8 Based Product for production;
	Introduce the 8x8 Based Product into ST's manufacturing plant; and
	Production samples of the 8x8 Based Product.

	Costs.  The costs associated with the various development tasks
described in the above three phases will be assumed by the Party responsible for
a given task and shared on a mutually agreeable basis when responsibility is
joint.
	Project Manager.  With respect to each SOW,
the Parties shall each name a project manager. The project managers will be
responsible for the technical management of the SOW and shall make themselves
available for meetings between the Parties on an as-needed basis to ensure the
progress of such Project. The project managers shall have technical expertise
related to the goals of the SOW. The project managers will monitor the overall
progress of each SOW, and make recommendations to the Parties regarding any
proposed additions, deletions or modifications to the Statement of
Work.

	Project Delays.  Each Party shall promptly communicate to the other
Party any and all difficulties that might materially affect the timely
completion of any milestone set forth in the relevant SOW and where possible
estimate the probable or actual impact to the aforesaid milestone resulting from
such difficulties, and any actions which might favorably resolve such
difficulties.  To the extent the completion of any activity defined in an SOW
and required to be performed by either Party is delayed by such Party, there
shall be an extension equal to such delay in the target completion dates of all
subsequent dependent activities set forth in the SOW. 

	SOW Change Orders.  The Parties recognize that the design and
development efforts described in a SOW might need to be revised over time.
Absent written approval from the Parties, no change(s) that would substantially
impact costs, functionality, scope of work, or milestone schedules (collectively
"Major Modifications") shall be made to any SOW.  Major Modifications
to any SOW shall be reflected in a new version of the SOW, which will be
appended to this Agreement.  All proposed Major Modifications will be fully
described in a Project change summary for consideration by both Parties,
including any changes affecting the anticipated costs of the Project.  All Major
Modifications will be negotiated and agreed upon in writing prior to
implementation.

	Third party licenses. With respect to Deliverables to be delivered by
a Party under a Project (the "Delivering Party"), the Delivering Party
shall use reasonable commercial efforts to obtain under fair and reasonable
terms and conditions satisfactory to the other Party, any third party license
and support agreement for tools and software that are identified in the SOW as
necessary for efficient completion of a Project.
	Support and Maintenance of the 8x8 Based
Product

	For a period of six (6) months after the Completion of a relevant
Project 8x8 will provide ST the support and maintenance for the 8x8 Based
Product as described in Exhibit 1 of the License Agreement. At the latest within
thirty (30) days after the end of this six (6) months period and upon payment of
the Fees ST shall have the right to extend the support and maintenance for
another twelve (12) months period, thereafter such support and maintenance will
be automatically extended on a year-to-year basis upon payment by ST of the Fees
before the end of the current year.

3.2 Upon ST's request 8x8 agrees to negotiate with Customers reasonable terms
and conditions associated with direct support of the Customers. Such support
shall include, without limitation, training, design-in support, software
maintenance and upgrades.

	Licensing of IP Rights

	License of 8x8 IP Rights. The right for ST and its Affiliates to use the
Deliverables owned or controlled by 8x8 is covered in Section 2 of the License
Agreement.

	License of ST IP Rights. ST grants to 8x8 a non-exclusive, worldwide,
royalty-free license to use and modify, in accordance with the terms and
conditions of a Project, the ST Technology to design and develop 8x8 Based
Products.
	Ownership

	Original Ownership.  All IP Rights owned or
controlled by a Party prior to the Effective Date or prior to any Project
Acceptance shall remain the property of such party throughout the term of this
Agreement and thereafter. 
	8x8 Sole Ownership. Except as set forth in
Section 5.4 below, all IP Rights originated, discovered or developed by or for
8x8, shall be owned by 8x8.  
	ST Sole Ownership. All IP Rights originated,
discovered or developed by or for ST shall be owned by ST. All Mask Work
generated by the Parties, individually or collectively, pursuant to this
Agreement shall be the property of ST. However, ST's ownership of the Mask Works
shall not be deemed to give ST any ownership in any 8x8's IP Rights even though
such 8x8's IP Rights may be fixed in those Mask Works.
	Joint Ownership.  With the exception of any
ownership rights set forth in Sections 5.1 ("Original
Ownership"), 5.2 ("8x8 Sole Ownership"), and 5.3 ("ST Sole
Ownership") above, any IP Rights originated, discovered or developed
jointly by both Parties ("Jointly Owned IP Rights") shall be jointly
owned and each Party shall have the unrestricted right to use such Jointly Owned
IP Rights without accounting to the other Party, including the right to
license the Jointly Owned IP Rights without the prior written approval of the
other Party.

	Patent Prosecution. Patent applications and other means of formal
protection shall be filed in the joint names of the Parties with respect to any
such jointly owned IP Rights which the Parties jointly deem to be worthy of
seeking any such protection. Consistent with the laws of the countries involved,
the Parties shall jointly determine the country of jurisdiction within which the
first patent application or other such protection shall be filed and, which of
the Parties shall be responsible for the preparation and filing of the patent
application or other such application. The Parties shall also jointly determine
which other countries of jurisdictions any such application shall be filed and
which of the Parties shall be responsible for such other filing. If the Parties
cannot agree as to whether a particular jointly owned IP Rights should be the
subject of patent or other formal protection, or cannot agree upon the countries
or jurisdictions within which such application shall be filed, either Party may,
on its own, seek such patent or other protection in any desired country or
jurisdiction, and the other Parties shall cooperate with the Party seeking such
protection. Unless otherwise agreed, all patent applications or other formal
protection, whether pursued by all Parties or by one Party, shall be jointly
owned by all Parties and all Parties shall be responsible for paying one-half
(1/2) of the total cost involved in preparing, filing, prosecuting, issuing and
maintaining any such applications and any resulting patents or other protection.
The Parties shall consult with each other no less than once per calendar year
for the purpose of identifying jointly owned IP Rights for which protection
should be sought, the countries of jurisdictions in which such protection should
be sought and in equalizing the costs involved in such protection. In case a
Party is not or no more interested in participating in a patent or patent
application, it shall notify the other Party thereof, in writing, at the
earliest practicable date, and shall forthwith relinquish to the other Party its
rights to such patent or patent application, then the other Party shall have the
right, at its expenses, to prosecute such application or maintain said patent or
patent application. The relinquishing Party agrees, at the other Party's
expenses, to co-operate fully with the other Party to assist the other Party in
obtaining (by assigning all its rights title and interest in the application),
maintaining, defending and renewing such patent or patent application. For the
purpose of this Section 5.4 "joint" ownership with respect to inventions and
copyrights shall be defined in accordance with the then-current United States
patent law or copyright law, as applicable.
	Derivative IP.  All Improvements,
modifications or derivatives created by either Party to its own IP Rights or the
IP Rights of the other Party (collectively "Derivative IP") during the
course of this Agreement, and in accordance with the licenses granted in
Section 4 ("Licensing of IP Rights") above, shall be owned by the
owner of the original IP Rights, but shall be licensed to the other Party in
accordance with the licenses applicable to the underlying IP Rights as set forth
in Section 4 ("Licensing of IP Rights") above. 

	Assignment.  Each Party agrees to assign to the other as necessary
all right title and interest in and to any IP Rights made or developed by such
Party which is to be owned by the other Party pursuant to
Sections 5.5 above, and further agrees to assist the other Party
with any application for patent rights and any other means of formal protection
and to do all commercially reasonable acts that may be required by the other
Party in connection with such assignment or assistance. The Party entitled to
the assignment and assistance will reimburse the other Party the reasonable cost
incurred by such other Party in providing such assignment and
assistance.

	Exclusivity

	Exclusive Market. 8x8 acknowledges and agrees that the 8x8 Based
Products will be exclusively commercialized, sold or otherwise disposed,
directly or indirectly by ST and/or its Affiliates in the Exclusive Market.
Consequently, 8x8 agrees not to develop (solely or jointly) or have developed,
except under this Agreement, manufacture, have manufactured, sell, commercialize
or otherwise dispose of 8x8 Based Product in the Exclusive Market.

	Development activity. Unless otherwise agreed to by the Parties in
writing, 8x8 agrees that for a period of one year (12 months) after the date of
Project Acceptance it will not engage in any development activity (by itself or
with or for a third party) the result of which will be a product, with features
substantially similar to the Product subject matter of the Project Acceptance,
to be marketed in the Exclusive Market, as defined for a Project, in competition
with the Product.  The definition of substantially similar as it relates to a
Product features is to be defined in each SOW.  Nothing herein shall limit 8x8's
rights to develop products (solely or for a third party) that are not to be
marketed in the Exclusive Market.
	. Licensing. Unless otherwise agreed to by the Parties in writing,
8x8 agrees that for a period of six (6) months after Completion of a Project as
defined hereunder, it will not license the Deliverables to a third party.
However, nothing herein shall limit 8x8's rights to (a) use, dispose of and
license to any third party the Ordinary Course Technology and the IP Rights in
the Deliverables owned by 8x8 pursuant to Section 5.2 hereto, and (b) provide
reasonable technical support to the licensed third party similar to that
described in the License Agreement Exhibit 1 so long as such support does not
consist of joint development activities, that would violate the disposition of
Section 6.2 above.
	Nothing herein shall limit 8x8's rights to license the Existing Technology
to any third party and to provide such third party maintenance and support
similar to that described in the License Agreement Exhibit 1 so long as such
support does not consist of joint development activities that would violate the
disposition of Section 6.2 above.

	Marketing and Sales

	Marketing.  8x8 agrees to reasonably assist ST in the marketing of 8x8
Based Products, which assistance could include developing joint marketing
materials, participating in trade shows, referring clients, and similar
activities. 8x8 shall reasonably assist ST in field trials and other
demonstrations of the 8x8 Based Products.  

	Press Releases.  The Parties shall issue common press releases
related to the execution of this Agreement, with regard to the Parties'
relationship, and as the 8x8 Based Products subject matter of a Project are
developed.  The Parties may also issue their own separate announcements and
press releases regarding this Agreement.  Each such press release shall be
subject to the review and approval of the other Party, such approval not to be
unreasonably withheld or delayed.  No pre-approval shall be required regarding
press releases by either Party which relate solely to 8x8 Based Products, and
not to the other Party nor to this Agreement. Otherwise, neither Party shall
make any announcement or press release regarding this Agreement or any terms
thereof without the other Party's prior written consent.
However, either party is free to file with the SEC or other relevant government
agencies any document required to be filed thereon advice of counsel (redacted
in a form advised by counsel).

	Sales of 8x8 Based Products. In accordance with the then current ST
terms and conditions of sale or certain other terms and conditions as
specifically agreed to in writing by an authorized representative of the
Parties, 8x8 will have the rights to purchase 8x8 Based Products from ST and (a)
sell such 8x8 Based Products in an 8x8 board system, subsystem, or similar
applications in which case the 8x8 Based Products will not carry 8x8 trademark
or logo or (b) resell such 8x8 Based Products in which case the 8x8 Based
Products to be purchased will carry the 8x8 trademark or logo. 8x8 cannot resell
the 8x8 Based Products on the Exclusive Market without ST prior written
approval.
	Under substantially the same terms as described in 7.3, and for the same
quantities of 8x8 Based Products fabricated under the same manufacturing
process, ST will grant to 8x8 the best price it makes available to its customers
with respect to the 8x8 Based Products.

	Royalties and Non-Recurring Engineering Charges ("NRE")

	ST shall pay to 8x8 the royalties described and defined for each Project
in Exhibit 5 and amendments thereof. The royalties to be paid shall be in
accordance with the terms and conditions defined in Section 4 of the License
Agreement and any other terms and conditions specified in Exhibit 5 relative to
a specific Project.
	In the event the Parties agree that NRE will apply to a Project, the amount
and payment schedule of such NRE will be described in the relevant SOW. Unless
otherwise agreed, NRE will be paid by ST within thirty (30) days from receipt of
the relevant invoice.

	Indemnification

	The terms and conditions of the indemnification provided by 8x8 to ST
and its Affiliates in the event the Deliverables licensed to ST under to this
Agreement infringe the rights of a third party are set forth in Section 6
"Indemnification" of the License Agreement.

	Term and Termination

	Term.  The Term of this Agreement shall begin on
the Closing Date, and unless earlier terminated as hereinafter set forth, shall
remain in force for an initial period of five (5) years, and shall automatically
extend for additional one (1) year periods unless either Party gives
notification of its intention not to renew within sixty (60) days of the
expiration of the initial term or any renewal period.
	Termination. Each Party may, in its
discretion, upon written notice to the other Party, and in addition to its
rights and remedies provided under this Agreement and at law, terminate this
Agreement in the event of any of the following:

	Termination for Breach. Upon a breach by the
other Party of any material provision in this Agreement and failure of the breaching Party to cure such material
breach within thirty (30) days of written notice of such breach.

	Termination for Bankruptcy. In the event a Party becomes the subject
of any voluntary or involuntary proceeding under the applicable national or
state bankruptcy or insolvency laws and such proceeding is not terminated within
sixty (60) days of its commencement.

	Effect of Termination on joint development
obligations. In the event that this Agreement is terminated for any reason,
neither Party shall be required to engage in any further joint development under
any Project.  Any discussions in effect for which the Parties do not have
Project Acceptance, will immediately cease and any Project(s) for which
production samples have not been developed pursuant to Phase 3 at the time of
the termination, shall terminate immediately unless the Parties otherwise agree,
provided, however, that each Party shall deliver to the other within thirty (30)
days of termination all Deliverables developed pursuant to such Project(s) as
the of the date of termination.
	Notwithstanding anything to the contrary herein, no expiration or
termination of this Agreement shall relieve ST of its obligation to pay any sum
due hereunder.

	Survival. The provisions of Sections 1
("Definitions"), 4 ("Licensing of IP Rights") except for
ST's right to design, develop and have developed new Product if the termination
is caused by ST's material breach, 5 ("Ownership"),  8
("Royalties"),  9 ("Indemnification"), 10 ("Term and
Termination"), 11 ("Confidentiality"), 12 ("Limitation of
Liability") and 13 ("General Provisions") shall survive any
termination of this Agreement.
	Confidentiality

	Obligation of Confidentiality. The Receiving Party shall, during the
term of the Agreement, and for a period of five (5) years thereafter, subject to
the exclusions set forth in Section 1.1.7 ("Confidential
Information"), hold all Confidential Information of the Disclosing Party in
confidence, not disclose such Confidential Information to any third parties
except those with a need to know in connection with or during the performance of
this Agreement (including, as necessary, subcontractors) who have executed a
confidentiality agreement with terms at least as restrictive with regard to the
Disclosing Party's information as those set forth herein, and in general use the
same degree of care to protect the confidentiality of the Disclosing Party's
Confidential Information as it uses with respect to its own information of a
similar nature.

	Non-Use. Neither 8x8 nor Licensee shall use the other Party's
Confidential Information for another or other purpose than for the purposes set
forth in this Agreement and the License Agreement.

	Expiration. Except as otherwise provided in Section 7.3 of the
License Agreement, upon termination of this Agreement all of the Disclosing
Party's Confidential Information and all copies thereof in the Receiving Party's
possession or control shall be immediately returned to the Disclosing Party or
destroyed by the Receiving Party at the Disclosing Party's instruction. The
Receiving Party shall then certify the same in writing and that no copies have
been retained by the Receiving Party, its employees, Affiliates, contractors, or
other parties to whom such information is provided.

	Injunctive Relief. The Receiving Party acknowledges that the
unauthorized disclosure of the Disclosing Party Confidential Information will
cause irreparable harm and significant injury, the scope of which is difficult
to ascertain. Accordingly, the Receiving Party agrees that the Disclosing Party
shall have the right to an immediate injunction enjoining any such unauthorized
disclosure.
	Limitation of Liability..

	EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, IN NO EVENT SHALL EITHER
PARTY BE LIABLE TO THE OTHER OR TO ANY THIRD PARTY FOR ANY SPECIAL, INDIRECT,
PUNITIVE, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION,
LOSS OF PROFITS), CAUSED BY ANY BREACH OF ITS OBLIGATIONS TO THE OTHER ARISING
OUT OF OR RELATING TO THIS AGREEMENT, REGARDLESS OF THE FORM OF ACTION, WHETHER
IN CONTRACT OR IN TORT (INCLUDING NEGLIGENCE), EVEN IF THE BREACHING PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
	EXCEPT AS SET FORTH IN SECTION 9.2 OF THE LICENSE AGREEMENT, IN NO EVENT
SHALL THE TOTAL LIABILITY OF EITHER PARTY TO THE OTHER PARTY FOR ANY LOSS,
DAMAGE OR LIABILITY ARISING FROM A BREACH OF EITHER THIS AGREEMENT, THE LICENSE
AGREEMENT OR BOTH EXCEED A SUM OF TWO MILLION DOLLARS ($2,000,000), PROVIDED
THAT SUCH LIMIT SHALL NOT APPLY IN THE EVENT OF A WILLFUL MISUSE OR WILLFULLY
UNLAWFUL DISTRIBUTION OF THE LICENSED TECHNOLOGY, AND PROVIDED THAT FOR ST SUCH
LIMITATION SHALL NOT APPLY IN THE EVENT ST FAILS TO PAY THE ROYALTIES AND THE
NRE EARNED BY 8X8 AND DUE BY ST AS SET FORTH IN SECTION 8 HERETO.

	General Provisions

	Assignment. This Agreement may not be assigned by either Party, nor any
of such Party's rights or obligations hereunder, to any third party including
without limitation through a U.S. Bankruptcy Code Chapter 11 reorganization,
without prior written consent of the other Party (which shall not be
unreasonably withheld). In the event that this Agreement is assigned effectively
to a third party, this Agreement shall bind upon successors and assigns of the
Parties hereto. Notwithstanding the foregoing, either Party may assign this
Agreement to an Affiliate provided that the assigning Party so notifies the non-
assigning Party in writing and the assignee agrees to assume all of the
obligations of the assigning Party under this Agreement.  In the event that the
assignee ceases to be an Affiliate, this Agreement will immediately be re-
assigned to ST and ST will assume all obligations under this Agreement.

	Affiliates. Both Parties acknowledge that the other party may or does
conduct its business in whole or in part through Affiliates. Accordingly, both
Parties agrees that the rights and benefits granted to the other Party through
this Agreement shall inure to the other Party and its Affiliates.

	Force Majeure. Neither Party shall be liable to the other Party for
failure of or delay in performance of any obligation under this Agreement,
directly or indirectly, owing to acts of God, war, war-like condition,
embargoes, riots, strike and other events beyond its reasonable control. In the
event that such failure or delay occurs, the affected Party shall notify the
other Party of the occurrence thereof as soon as possible and the Parties shall
discuss the best way to resolve the event of force majeure.

	Notices.  All notices provided for in connection with this Agreement
shall be given in writing and shall be effective (i) upon receipt, when
served by personal delivery; or (ii) the next day following the date of
transmittal when transmitted by facsimile; or (iii) on the third day
following the date of  transmittal when transmitted by express mail; or
(iv) on the 7th day following the date of mailing when sent by registered
airmail of the sender's country with postage prepaid, addressed to the Party as
follows, or to a changed address as the Party shall have specified by prior
written notice:

ST:  ST Microelectronics, Inc. at 1310 Electronics Drive Carrolton, TX 75006
USA. Attention: General Counsel; and

8x8:   8x8, Inc. 2445 Mission College Blvd. Santa Clara, California 95054
Attention: Chief Financial Officer.

	Waiver.  The waiver by either Party of the remedy for the other
Party's breach of or its right under this Agreement will not constitute a waiver
of the remedy for any other similar or subsequent breach or right.

	Severability.  If any provision of this Agreement is or becomes, at
any time or for any reason, unenforceable or invalid, no other provision of this
Agreement shall be affected thereby, and the remaining provisions of this
Agreement shall continue with the same force and effect as if such unenforceable
or invalid provisions had not been inserted in this Agreement.
	Amendment.  No changes, modifications or
alterations to this Agreement shall be valid unless reduced to writing and duly
signed by the respective authorized representative of each Party.

	Governing Law.  This Agreement shall be interpreted, construed and
enforced in accordance with the laws of the State of California without respect
to its conflict of law provisions.

	No Partnership. In giving effect to this Agreement, no Party shall be
or be deemed to be an agent or employee of another Party for any purpose, and
that their relationship to each other shall be that of independent contractors.
Nothing in this Agreement shall constitute a partnership or a joint venture
between the Parties. No Party shall have the right to enter into contracts or
pledge the credit of or incur expenses or liability on behalf of the other
Party.

	Entire Agreement.  This Agreement and the License Agreement
constitute the entire agreement between the Parties and supersede all prior
proposal(s) and discussions relative to the subject matter of this Agreement and
neither of the Parties shall be bound by any conditions, definitions,
warranties, understandings or representations with respect to the subject matter
other than as expressly provided herein. The terms and conditions contained
herein and the appendixes attached hereto constitute the entire agreement
between the parties and shall supersede all previous communications either oral
or written between the parties with respect to the subject matter hereof. No
oral explanation or oral information by either party hereto shall alter the
meaning or interpretation of this Agreement.

	IN WITNESS THEREOF, the Parties hereto have executed this Agreement
on the Effective Date.

	
For ST Microelectronics, Inc.:
	
For 8x8, Inc.

	
Name:    A.McK. Malone
	
	
Name:    Paul Voois
	

	
Title:    Executive Vice President and CFO
	
	
Title:    Chairman and CEO
	

	
Signature: /s/    A. McK. Malone
	
	
Signature: /s/    Paul Voois
	

 

MTA-1 PROJECT EXHIBIT 1

Fees

The Fee for extended maintenance and support of the MTA-1 Project is
$200,000 per twelve (12) months of which $100,000 is to represent non-refundable
pre-paid royalties.  $150,000 is due within 30 days of the start of the extended
maintenance period for which the Fee is due as specified in Section 3.1.  The
balance, representing the last $50,000 of the pre-paid royalties, are due within
six months of the start of the extended maintenance period for which the Fee is
due.

MTA-1 PROJECT EXHIBIT 2

Project Plan for the MTA-1 Project 

To implement a Multimedia Terminal Adapter ("MTA-1") design (including an
integrated DOCSIS cable modem module) as defined by the CableLabs' PacketCable
specification which is to include, without limitation, the following ("MTA-
1 Project").

	Development of a platform that demonstrates PacketCable version 1.0 and
version 1.1 (when finalized) telephony and that incorporates mutually agreed to
8x8 and ST standard semiconductor and modified firmware products ("Demonstration
Platform").
	Development of one or more, as mutually agreed to,  MTA-1 reference designs
that incorporate mutually agreed to and/or jointly developed chips and firmware
("Reference Design").
	Development of a new voice over Internet protocol ("VOIP") chip to be
incorporated into the Reference Design ("VOIP Chip").  The architecture of the
VOIP Chip is to be mutually agreed to but is assumed to include, without
limitation, the ST SH4 RISC core or another version of ST's SH RISC core ("SH
Core"), a suitably modified version of the 8x8 VP7 DSP core, a DOCSIS cable
modem module and other circuitry.
	ST will be responsible for development and validation of the DOCSIS v1.1
compliant cable modem subsystem hardware and software for the Demonstration
Platform and the Reference Design.
	8x8 will be responsible for the development of software, firmware and a
hardware design of a VOIP subsystem for the Demonstration Platform; the VOIP
firmware (including the Call Code running under a POSIX compliant operating
system and the Audio Code) for the VOIP chip as incorporated in the Reference
Design; and, implementation of a VOIP Chip compatible version of the 8x8 DSP
core.
	ST will be responsible for implementation and fabrication of an 8x8 DSP chip
that is to be used for firmware development and in an initial Reference Design
("DSP Chip"), the VOIP Chip, and certain other components of the
Demonstration Platform and the Reference Design.  8x8 will provide reasonable
technical support sufficient to assist in the DSP Chip and VOIP Chip development
effort.
	Assuming an Effective Date prior to January 24, 2000 the schedule for the
implementation of the MTA-1 design is to include, without limitation and subject
to change:

	A target date of one month after the Effective Date for completion of the
SOW
	A target date of 2Q2000 for shipment to ST of the VOIP subsystem for the
Demonstration Platform
	A target date of 1Q2000 for shipment to ST of the 8x8 DSP Design Kit as
defined herein.
	A target date of 3Q2000 for shipment by ST to 8x8 of the DSP Chip.
	A target date of 4Q2000 for shipment to ST of the initial VOIP Chip
firmware.
	A target date of 4Q2000 for initial shipment to ST's customers of a
Reference Design based on the DSP Chip and other components.
	A target date of 2Q2001 for initial shipment to ST's customers of the VOIP
Chip and a Reference Design based on the VOIP Chip.

	Each party will participate in mutually agreed to industry sponsored
interoperability and certification events (e. g. CableLabs) to ensure that the
products are compatible with solutions from other vendors and with applicable
standards.
	The costs associated with the various development tasks will be assumed by
the party responsible for a given task and shared on a mutually agreeable basis
when responsibility is joint.
	 Neither party is obligated to make any efforts beyond the Completion date
for the Project, provided that, in the event the MTA-1 Project is not completed
as of the Completion date, the parties shall meet and will decide in good faith
future actions related to the MTA-1 Project.

 

MTA-1 PROJECT EXHIBIT 3

Statement of Work for the MTA-1 Project

The SOW for the MTA-1 Project is to be executed and mutually agreed to
within one (1) month of the Effective Date

 

MTA-1 PROJECT EXHIBIT 4

ST Technology

	ST will provide 8x8 the appropriate SH Core (as of the Effective Date SH
Core refers to SH4 core) based development platform, any ST specific firmware
and technical support that will enable the efficient implementation of the Call
Code and the Audio Code on the Demonstration platform, Reference Design, DSP
Chip and VOIP chip.
	ST will provide technical specifications of the ST Bus and other ST
proprietary interfaces required for development of the VOIP Chip compatible
version of the 8x8 DSP core;
	ST will provide 8x8 the ST standard cell libraries, memory models/compilers,
timing models, synthesis scripts and other tools sufficient for 8x8 to perform
gate level synthesis, simulation and verification of a DSP Chip and VOIP Chip
compatible version of the 8x8 DSP core.
	ST will provide 8x8 the appropriate ST design tools and gate level
implementation of the 8x8 DSP sufficient to enable verification and an early
development simulation environment with which to begin development of the Audio
Code.

 

 

MTA-1 PROJECT EXHIBIT 5

Engineer Charges and Royalties

There is no NRE relative to the MTA-1 Project.  The royalty schedule for
the MTA-1 Project is described below.  The payment terms are as described in the
License Agreement

MTA-1 Project Royalty Schedule

 

	
8x8 Intellectual Property
	
Per unit of 8x8 Based Products for the first 1 million
units of the 8x8 Based Products Licensee ships to Customers
	
Per unit of 8x8 Based Products for the next 1 million units
after the initial 1million units of the 8x8 Based Products Licensee ships to
Customers.
	
Per unit of the 8x8 Based Product for the next 1 million
units after the initial 2 million units of the 8x8 Based Products Licensee ships
to Customers
	
Per unit of 8x8 Based Products after Licensee has shipped 3
million units of 8x8 Based Products to Customers (As a percentage of the Net
Sale Price)

	
Call Code
	
$0.85
	
$0.55
	
$0.45
	
2.0%

	
Audio Code
	
$0.85
	
$0.55
	
$0.45
	
2.0%

	
8x8 DSP
	
$0.65
	
$0.40
	
$0.30
	
1.0%

The royalty schedule will reset for each Product

Notes:

	The royalty amounts above in the rightmost column that are based on a
percentage of the Net Sale Price are subject to a minimum royalty of $0.44 for
the Call Code, $0.44 for the Audio code and $0.22 for the 8x8 DSP applicable per
unit of 8x8 Based Product that Licensee ships to Customers.
	The royalty amounts above in the rightmost column that are based on a
percentage of the Net Sale Price are subject to a maximum royalty of $0.60 for
the Call Code, $0.60 for the Audio code and $0.30 for the 8x8 DSP applicable per
unit of 8x8 Based Product that Licensee ships to Customers.

 

	8x8 DSP royalty applies per 8X8 Based Product regardless of the number of
8x8 DSP cores per 8X8 Based Product.

 

 

MTA-1 PROJECT EXHIBIT 6

Exclusive Market

The MTA-1 Project Exclusive Market shall mean the market relative to
voice over IP applications for consumer terminals over hybrid fiber coax cable
television networks.

ST120 PROJECT EXHIBIT 1

Fees

The Fee for extended maintenance and support of the ST120 Project is
$200,000 per twelve (12) months of which $100,000 is to represent non-refundable
pre-paid royalties.  $150,000 is due within 30 days of the start of the extended
maintenance period for which the Fee is due as specified in Section 3.1.  The
balance, representing the last $50,000 of the pre-paid royalties, are due within
six months of the start of the extended maintenance period for which the Fee is
due.

ST120 PROJECT EXHIBIT 2

Project Plan for the ST120 Project 

To implement a ST DSP and ARM based voice over IP design ("ST120
Project") including a reference design based on the ST950 and the ARM7
("ST950 Design") and a reference design based on the ST120 and the
ARM7, or another mutually agreed to RISC processor ("ST120
Design").

	8x8 will provide technical assistance, as defined in the License Agreement
Exhibit 1, sufficient to enable ST to modify or have modified on its behalf the
Call Code for execution on the ST ARM7 core or another mutually agreed to RISC
processor and the ST120 if and when appropriate.
	8x8 will provide sufficient technical support to enable the integration and
verification of the ARM7 based Call Code with the ST950 DSP based audio
subsystem for the ST950 Design and with the ST120 DSP for the ST120 Design.
	ST will be responsible for implementation of the appropriate modifications
to the ST950 DSP core firmware necessary for efficient integration with the ARM7
based Call Code for the ST950 Design.
	8x8 will be responsible for implementation of modifications to the Audio
Code for execution on the ST120 DSP core.
	ST will be responsible for implementation and fabrication of the board level
ST950 Design.
	8x8 and ST will jointly design the board level ST120 Design.
	ST will be responsible for implementation and fabrication of the board level
ST120 Design.
	8x8 will provide sufficient technical support to enable the implementation
and verification of the board level ST120 Design.
	Assuming a Project Acceptance date prior to January 24, 2000 the schedule
for the implementation of the ST120 Project design is to include, without
limitation and subject to change:

	A target date of one week after the Project Acceptance date for 8x8 to send
to ST the Call Code as it exists on the Effective Date.
	A target date of one month after the Project Acceptance date for completion
of the initial SOW
	A target date of 1Q2000 for ST's delivery of the ST120 and ST950 development
tools including, but not limited to, the VLIW and other applicable compilers,
debuggers, linkers and utilities.
	A target date of 2Q2000 for ST's delivery to 8x8 of the ST120 development
system.
	A target date of 2Q2000 for initial Customer shipment of the ST950
Design.
	A target date of 3Q2000 for shipment to ST of the initial implementation and
of the ST120 compatible Audio Code consisting of some mutually agreed to subset
thereof with additional functions, as agreed to, to be delivered in 4Q2000.
	A target date of 4Q2000 for initial Customer shipment of the initial ST120
Design.

	Each party will participate in mutually agreed to industry sponsored and
other interoperability and certification events to ensure that the products are
compatible with solutions from other vendors and with applicable standards.
	Neither party is obligated to make any efforts beyond the Completion date
for the Project, provided that, in the event the ST120 Project is not completed
as of the Completion date, the parties shall meet and will decide in good faith
future actions related to the ST120 Project.

 

ST120 PROJECT EXHIBIT 3

Statement of Work for the ST120 Project

The SOW for the ST120 Project is to be executed and mutually agreed to
within one (1) month of the Project Acceptance date.

 

ST120 PROJECT EXHIBIT 4

ST Technology

	ST will provide 8x8 the appropriate ARM, ST950 and ST120 based
development systems and tools including any ST specific firmware and technical
support that will enable the efficient implementation of the ST120
Project.

 

 

ST120 PROJECT EXHIBIT 5

Engineering Charges and Royalties

	The Engineering Charges payable by ST to 8x8 for the ST120 Project is to
be $500,000 plus $500,000 of non-refundable prepaid royalties that are to be
credited toward future royalties otherwise due for shipment of the 8x8 Based
Products that are the result of the ST120 Project.  Both amounts are payable by
ST to 8x8 prior to the start of development work.
	The royalty schedule and payment terms for the ST120 Project is as described
in the License Agreement

 

 

ST120 PROJECT EXHIBIT 6

Exclusive Market

There is no applicable Exclusive Market relative to the ST120
Project.

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