Document:

Prepared by R.R. Donnelley Financial -- Amended and Restated 2000 Stock Plan

  
 Exhibit 10.3 
  
 TURNSTONE SYSTEMS, INC. 
  
 2000 STOCK PLAN 
  
 Amended and Restated 
 Adopted by the Board of Directors April 9, 2002 

 
 1.    Purposes of the Plan.    The purposes of this 2000 Stock Plan are: 

 

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	to attract and retain the best available personnel for positions of substantial responsibility, 
 

  

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	to provide additional incentive to Employees, Directors and Consultants, and 
 

  

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	to promote the success of the Company’s business. 
 

  
 Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as determined by the Administrator at the time of grant. Stock Purchase Rights may also be granted under the Plan.

  
 2.    Definitions.    As used herein, the following definitions shall apply:

  
 (a)    “Administrator” means the Board or any of its Committees as shall be administering
the Plan, in accordance with Section 4 of the Plan. 
  
 (b)    “Applicable Laws” means the
requirements relating to the administration of stock option plans under U. S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction where Options or Stock Purchase Rights are, or will be, granted under the Plan. 
  
 (c)    “Board” means the Board of Directors of the Company. 
  
 (d)    “Cause” means (i) any act of personal dishonesty taken by the Optionee in connection with his responsibilities as an Employee which is intended to result in personal enrichment of the Optionee,
(ii) the Optionee’s conviction of a felony, (iii) any act by the Optionee that constitutes misconduct, and (iv) continued violations by the Optionee of the Optionee’s obligations to the Company. 
  
 (e)    “Code” means the Internal Revenue Code of 1986, as amended. 
  
 (f)    “Committee” means a committee of Directors appointed by the Board in accordance with Section 4 of the Plan.

  
 (g)    “Common Stock” means the common stock of the Company. 
 

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 (h)    “Company” means Turnstone Systems, Inc., a Delaware
corporation. 
  
 (i)     “Consultant” means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary to render services to such entity. 
  
 (j)     “Director” means a member of the Board. 
  
 (k)    “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code. 
  
 (l)     “Employee” means any person, including Officers and Directors, employed by the Company or any Parent or Subsidiary of the Company. A Service Provider shall not cease
to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. For purposes of Incentive Stock Options, no
such leave may exceed ninety days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, on the 181st day of such
leave any Incentive Stock Option held by the Optionee shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option. Neither service as a Director nor payment of a director’s fee by
the Company shall be sufficient to constitute “employment” by the Company. 
  
 (m)   “Exchange
Act” means the Securities Exchange Act of 1934, as amended. 
  
 (n)    “Fair Market
Value” means, as of any date, the value of Common Stock determined as follows: 
  
 (i)    If the
Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales
price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; 
  
 (ii)    If the Common Stock is regularly quoted by a recognized securities
dealer but selling prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day prior to the day of determination, as
reported in The Wall Street Journal or such other source as the Administrator deems reliable; or 
  
 (iii)    In the absence of an established market for the Common Stock, the Fair Market Value shall be determined in good faith by the Administrator. 
  
 (o)    “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and
the regulations promulgated thereunder. 
 

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 (p)    “Inside Director” means a Director who is an
Employee. 
  
 (q)    “IPO Effective Date” means the date upon which the Securities and
Exchange Commission declares the initial public offering of the Company’s Common Stock as effective. 
  
 (r)    “Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive Stock Option. 
  
 (s)    “Notice of Grant” means a written or electronic notice evidencing certain times and conditions of an individual Option or Stock Purchase Right grant. The Notice of Grant is
part of the Option Agreement. 
  
 (t)    “Officer” means a person who is an officer of the
Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder. 
  
 (u)    “Option” means a stock option granted pursuant to the Plan. 
  
 (v)    “Option Agreement” means an agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and
conditions of the Plan. 
  
 (w)    “Option Exchange Program” means a program whereby
outstanding Options are surrendered in exchange for Options with a lower exercise price. 
  
 (x)    “Optioned Stock” means the Common Stock subject to an Option or Stock Purchase Right. 
  
 (y)    “Optionee” means the holder of an outstanding Option or Stock Purchase Right granted under the Plan. 
  
 (z)    “Outside Director” means a Director who is not an Employee. 
  
 (aa)    “Plan” means this 2000 Stock Option Plan, as amended and restated. 
  
 (bb)    “Restricted Stock” means shares of Common Stock acquired pursuant to a grant of Stock Purchase Rights under Section 11 of the Plan.

  
 (cc)    “Restricted Stock Purchase Agreement” means a written agreement between the
Company and the Optionee evidencing the terms and restrictions applying to stock purchased under a Stock Purchase Right. The Restricted Stock Purchase Agreement is subject to the terms and conditions of the Plan and the Notice of Grant.

  
 (dd)    “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3,
as in effect when discretion is being exercised with respect to the Plan. 
  
 (ee)    “Section
16(b) “ means Section 16(b) of the Exchange Act. 
  
 (ff)    “Service Provider” means
an Employee, Director or Consultant. 
 

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 (gg)    “Share” means a share of the Common Stock, as
adjusted in accordance with Section 14 of the Plan. 
  
 (hh)    “Stock Purchase Right” means
the right to purchase Common Stock pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant. 
  
 (ii)    “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing, as defined in Section 424(f) of the Code. 
  
 3.    Stock Subject to the Plan.    Subject to the provisions of Section 14 of the Plan, the maximum aggregate number of Shares which may
be optioned and sold under the Plan is 5,000,000 Shares, plus the Shares available for future issuance under the Turnstone Systems, Inc. 1998 Stock Plan (the “1998 Stock Plan”) as of the effective date of this Plan and any Shares returned
to the 1998 Stock Plan. The number of Shares reserved for issuance under the Plan shall increase annually on the first day of the Company’s fiscal year beginning in 2000 by an amount of Shares equal to the lesser of (i) 5,000,000 Shares, (ii)
6% of the outstanding Shares on such date or (iii) an amount determined by the Board. The Shares may be authorized, but unissued, or reacquired Common Stock. 
  
 If an Option or Stock Purchase Right expires or becomes unexercisable without having been exercised in full, or is surrendered pursuant to an Option Exchange Program, the unpurchased Shares which were subject thereto
shall become available for future grant or sale under the Plan (unless the Plan has terminated); provided, however, that Shares that have actually been issued under the Plan, whether upon exercise of an Option or Right, shall not be returned to the
Plan and shall not become available for future distribution under the Plan, except that if Shares of Restricted Stock are repurchased by the Company at their original purchase price, such Shares shall become available for future grant under the
Plan. 
  
 4.    Administration of the Plan. 
  
 (a)    Procedure. 
  
 (i)    Multiple Administrative Bodies.    The Plan may be administered by different Committees with respect to different groups of Service Providers. 
  
 (ii)    Section 162(m).    To the extent that the Administrator determines it to be desirable to qualify
Options granted hereunder as “performance-based compensation” within the meaning of Section 162(m) of the Code, the Plan shall be administered by a Committee of two or more “outside directors” within the meaning of Section 162(m)
of the Code. 
  
 (iii)    Rule 16b-3.    To the extent desirable to qualify
transactions hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder shall be structured to satisfy the requirements for exemption under Rule 16b-3. 
  
 (iv)    Other Administration.    Other than as provided above, the Plan shall be administered by (A) the Board or (B) a Committee, which
committee shall be constituted to satisfy Applicable Laws. 
 

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 (b)    Powers of the Administrator.    Subject
to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by the Board to such Committee, the Administrator shall have the authority, in its discretion: 
  
 (i)    to determine the Fair Market Value; 
  
 (ii)    to select the Service Providers to whom Options and Stock Purchase Rights may be granted hereunder; 
  
 (iii)    to determine the number of shares of Common Stock to be covered by each Option and Stock Purchase Right granted hereunder; 
  
 (iv)    to approve forms of agreement for use under the Plan; 
  
 (v)    to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Option or Stock Purchase Right granted hereunder. Such terms and conditions include, but are not
limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation
regarding any Option or Stock Purchase Right or the shares of Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine; 
  
 (vi)    to reduce the exercise price of any Option or Stock Purchase Right to the then current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option or Stock Purchase Right shall have declined since the date the Option or Stock Purchase Right was granted; 
  
 (vii)    to institute an Option Exchange Program; 
  
 (viii)    to construe and
interpret the terms of the Plan and awards granted pursuant to the Plan; 
  
 (ix)    to prescribe, amend and
rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws; 
  
 (x)    to modify or amend each Option or Stock Purchase Right (subject to Section 16(c) of the Plan), including the discretionary
authority to extend the post-termination exercisability period of Options longer than is otherwise provided for in the Plan; 
  
 (xi)    to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to be issued upon exercise of an Option or Stock Purchase Right that number of Shares having a
Fair Market Value equal to the amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by an Optionee to have Shares
withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable; 
 

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 (xii)    to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Option or Stock Purchase Right previously granted by the Administrator; 
  
 (xiii)    to make all other determinations deemed necessary or advisable for administering the Plan. 
  
 (c) Effect of Administrator’s Decision.    The Administrator’s decisions, determinations and interpretations shall be final and binding on all Optionees and any other holders of Options or Stock Purchase
Rights. 
  
 5.    Eligibility.    Nonstatutory Stock Options and Stock
Purchase Rights may be granted to Service Providers. Incentive Stock Options may be granted only to Employees. 
  
 6.    Limitations. 
  
 (a)    Each Option shall be designated in the Option
Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable
for the first time by the Optionee during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive
Stock Options shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be determined as of the time the Option with respect to such Shares is granted. 
  
 (b)    Neither the Plan nor any Option or Stock Purchase Right shall confer upon an Optionee any right with respect to continuing
the Optionee’s relationship as a Service Provider with the Company, nor shall they interfere in any way with the Optionee’s right or the Company’s right to terminate such relationship at any time, with or without Cause. 

 
 (c)    The following limitations shall apply to grants of Options: 
  

(i)    No Service Provider shall be granted, in any fiscal year of the Company, Options to purchase more than 1,000,000 Shares. 
  
 (ii)    In connection with his or her initial service, a Service Provider may be granted Options to purchase up to an additional
2,000,000 Shares, which shall not count against the limit, set forth in subsection (i) above. 
  
 (iii)    The
foregoing limitations shall be adjusted proportionately in connection with any change in the Company’s capitalization as described in Section 14. 
  
 (iv)    If an Option is cancelled in the same fiscal year of the Company in which it was granted (other than in connection with a transaction described in Section 14), the cancelled Option will be
counted against the limits set forth in subsections (i) and (ii) above. For this purpose, if the exercise price of an Option is reduced, the transaction will be treated as a cancellation of the Option and the grant of a new Option. 

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 7.    Term of Plan.    Subject to Section 20 of
the Plan, the Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten (10) years unless terminated earlier under Section 16 of the Plan. 
  
 8.    Term of Option.    The term of each Option shall be stated in the Option Agreement. In the case of an Incentive Stock Option, the
term shall be ten (10) years from the date of grant or such shorter term as may be provided in the Option Agreement. Moreover, in the case of an Incentive Stock Option granted to an Optionee who, at the time the Incentive Stock Option is granted,
owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option shall be five (5) years from the date of grant or such
shorter term as may be provided in the Option Agreement. 
  
 9.    Option Exercise Price and
Consideration. 
  
 (a)    Exercise Price.    The per share exercise price for
the Shares to be issued pursuant to exercise of an Option shall be determined by the Administrator, subject to the following: 
  
 (i)    In the case of an Incentive Stock Option 
  
 (A)    granted to an Employee
who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than
110% of the Fair Market Value per Share on the date of grant. 
  
 (B)    granted to any Employee other than an
Employee described in paragraph (A) immediately above, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant. 
  
 (ii)    In the case of a Nonstatutory Stock Option, the per Share exercise price shall be determined by the Administrator. In the case of a Nonstatutory Stock Option
intended to qualify as “performance-based compensation” within the meaning of Section 162(m) of the Code, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant. 

 
 (iii)    Notwithstanding the foregoing, Options may be granted with a per Share exercise price of less than 100% of the
Fair Market Value per Share on the date of grant pursuant to a merger or other corporate transaction. 
  
 (b)    Waiting Period and Exercise Dates.    At the time an Option is granted, the Administrator shall fix the period within which the Option may be exercised and shall determine any conditions
that must be satisfied before the Option may be exercised. 
  
 (c)    Form of
Consideration.    The Administrator shall determine the acceptable form of consideration for exercising an Option, including the method of payment. In the case of an Incentive Stock Option, the Administrator shall determine
the acceptable form of consideration at the time of grant. Such consideration may consist entirely of: 
 

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 (i)    cash; 
  
 (ii)    check; 
  
 (iii)    promissory note; 
  
 (iv)    other Shares which (A) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more than six months on the date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised; 
  
 (v)    consideration received by the Company under a cashless exercise program
implemented by the Company in connection with the Plan; 
  
 (vi)    a reduction in the amount of any Company
liability to the Optionee, including any liability attributable to the Optionee’s participation in any Company-sponsored deferred compensation program or arrangement; 
  
 (vii)    any combination of the foregoing methods of payment; or 
  
 (viii)    such other consideration and method of payment for the issuance of Shares to the extent permitted by Applicable Laws. 
  
 10.    Exercise of Option. 
  
 (a)    Procedure for Exercise; Rights as a Shareholder.    Any Option granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as
determined by the Administrator and set forth in the Option Agreement. Unless the Administrator provides otherwise, vesting of Options granted hereunder shall be tolled during any unpaid leave of absence. An Option may not be exercised for a
fraction of a Share. 
  
 An Option shall be deemed exercised when the Company receives: (i) written or electronic notice of
exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of
payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee and his or
her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the Shares are issued, except as provided in Section 14 of the Plan. 
 

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 Exercising an Option in any manner shall decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. 
  
 (b)    Termination of Relationship as a Service Provider.    Subject to Section 14, if an Optionee ceases to be a Service Provider (but not in the event of an Optionee’s change of status
from Employee to Consultant (in which case an Employee’s Incentive Stock Option shall automatically convert to a Nonstatutory Stock Option on the ninety-first (91st) day following such change of status) or from Consultant to Employee), such Optionee may, but only within such period of time as is specified in the Option Agreement (but in no event later
than the expiration date of the term of such Option as set forth in the Option Agreement), exercise his or her Option to the extent that Optionee was entitled to exercise it at the date of such termination. In the absence of a specified time in the
Option Agreement, the Option shall remain exercisable for three (3) months following the Optionee’s termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested
portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified by the Administrator, the Option shall terminate, and the Shares covered by such Option shall revert to
the Plan. 
  
 (c)    Disability of Optionee.    If an Optionee ceases to be a
Service Provider as a result of the Optionee’s Disability, the Optionee may, but only within twelve (12) months from the date of such termination (and in no event later than the expiration date of the term of such Option as set forth in the
Option Agreement), exercise his or her Option to the extent that the Option is vested on the date of termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion
of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

  
 (d)    Death of Optionee.    If an Optionee dies while a Service Provider, the
Option may be exercised at any time within twelve (12) months following the date of death (but in no event later than the expiration of the term of such Option as set forth in the Notice of Grant), by the Optionee’s estate or by a person who
acquires the right to exercise the Option by bequest or inheritance, but only to the extent that the Option is vested on the date of death. If, at the time of death, the Optionee is not vested as to his or her entire Option, the Shares covered by
the unvested portion of the Option shall immediately revert to the Plan. The Option may be exercised by the executor or administrator of the Optionee’s estate or, if none, by the person(s) entitled to exercise the Option under the
Optionee’s will or the laws of descent or distribution. If the Option is not so exercised within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  
 (e)    Buyout Provisions.    The Administrator may at any time offer to buy out for a payment in cash or
Shares an Option previously granted based on such terms and conditions as the Administrator shall establish and communicate to the Optionee at the time that such offer is made. 
 

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 11.    Stock Purchase Rights. 
  
 (a)    Rights to Purchase.    Stock Purchase Rights may be issued either alone, in addition to, or in
tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it shall advise the offeree in writing or electronically, by
means of a Notice of Grant, of the terms, conditions and restrictions related to the offer, including the number of Shares that the offeree shall be entitled to purchase, the price to be paid, and the time within which the offeree must accept such
offer. The offer shall be accepted by execution of a Restricted Stock Purchase Agreement in the form determined by the Administrator. 
  
 (b)    Repurchase Option.    Unless the Administrator determines otherwise, the Restricted Stock Purchase Agreement shall grant the Company a repurchase option exercisable upon the voluntary or
involuntary termination of the purchaser’s service with the Company for any reason (including death or Disability). The purchase price for Shares repurchased pursuant to the Restricted Stock Purchase Agreement shall be the original price paid
by the purchaser and may be paid by cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall lapse at a rate determined by the Administrator. 
  
 (c)    Other Provisions.    The Restricted Stock Purchase Agreement shall contain such other terms, provisions and conditions not
inconsistent with the Plan as may be determined by the Administrator in its sole discretion. 
  
 (d)    Rights as a Shareholder.    Once the Stock Purchase Right is exercised, the purchaser shall have the rights equivalent to those of a shareholder, and shall be a shareholder when his or
her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Stock Purchase Right is exercised, except as
provided in Section 14 of the Plan. 
  
 12.    Non-Transferability of Options and Stock Purchase
Rights.    Unless determined otherwise by the Administrator, an Option or Stock Purchase Right may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee. If the Administrator makes an Option or Stock Purchase Right transferable, such Option or Stock Purchase Right shall contain such additional
terms and conditions as the Administrator deems appropriate. 
  
 13.    Formula Option Grants to Outside
Directors.    Outside Directors shall be granted Options each year in accordance with the following provisions: 
  
 (a)    All Options granted pursuant to this Section shall be Nonstatutory Stock Options and, except as otherwise provided herein, shall be subject to the other terms and conditions of the Plan. 
  
 (b)    Except as provided in subsection (d) below, each person who first becomes an Outside Director on or after the 2002 annual
meeting of stockholders, whether through election by the stockholders of the Company or appointment by the Board to fill a vacancy, shall be
 
 

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automatically granted an Option to purchase 200,000 Shares (the “First Option”), as determined by the Board in its sole and absolute discretion, on the date he or she first becomes an
Outside Director; provided, however, that an Inside Director who ceases to be an Inside Director but who remains a Director shall not receive a First Option. 
  
 (c)    Except as provided in subsection (d) below, each Outside Director shall be automatically granted an Option to purchase 50,000 Shares (a “Subsequent Option”) following each annual
meeting of the stockholders of the Company if (i) such Outside Director has not received any other stock option or stock grant from the Company within the preceding six (6) months and (ii) immediately after such meeting, he or she shall continue to
serve on the Board and shall have served on the Board for at least the preceding six (6) months. 
  
 (d)    Notwithstanding the provisions of subsections (b) and (c) hereof, any exercise of an Option granted before the Company has obtained stockholder approval of the Plan in accordance with Section 20 hereof shall be
conditioned upon obtaining such stockholder approval of the Plan in accordance with Section 20 hereof. 
  
 (e)    The terms of each First Option granted pursuant to this Section shall be as follows: 
  
 (i)    the term of the Option shall be ten (10) years. 
  
 (ii)    the exercise
price per Share shall be 100% of the Fair Market Value per Share on the date of grant of the Option. 
  
 (iii)    the Option shall vest and become exercisable in three (3) equal annual installments on each of the first three anniversaries of its date of grant; provided that the Outside Director shall continue to serve on
the Board on such dates. 
  
 (f)    The terms of each Subsequent Option granted pursuant to this Section shall
be as follows: 
  
 (i)    the term of the Option shall be ten (10) years. 
  
 (ii)    the exercise price per Share shall be 100% of the Fair Market Value per Share on the date of grant of the Option.

  
 (iii)    the Option shall vest and become exercisable on the first anniversary of the date that all stock
options have vested that were granted to the Outside Director by the Company before the Option; provided, however, that the Option shall in all events vest and become exercisable on the last day of its ten-year term; provided, further, that in each
case the Outside Director shall continue to serve on the Board on such date. 
  
 14.    Adjustments Upon
Changes in Capitalization, Merger or Asset Sale. 
  
 (a)    Changes in
Capitalization.    Subject to any required action by the stockholders of the Company, the number of shares of Common Stock covered by each outstanding Option or Stock Purchase Right, and the number of shares of Common Stock
which have been authorized for
 
 

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issuance under the Plan but as to which no Options or Stock Purchase Rights have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each such outstanding Option or Stock Purchase Right, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company.
The conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock subject to an Option or Stock Purchase Right. 
  
 (b)    Dissolution or Liquidation.    In the event of the proposed dissolution or liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable prior to the
effective date of such proposed transaction. The Administrator in its discretion may provide for an Optionee to have the right to exercise his or her Option or Stock Purchase Right until fifteen (15) days prior to such transaction as to all of the
Optioned Stock covered thereby, including Shares as to which the Option or Stock Purchase Right would not otherwise be exercisable. In addition, the Administrator may provide that any Company repurchase option applicable to any Shares purchased upon
exercise of an Option or Stock Purchase Right shall lapse as to all such Shares, provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not been previously exercised, an Option
or Stock Purchase Right will terminate immediately prior to the consummation of such proposed action. 
  
 (c)    Merger or Asset Sale. 
  
 (i)    General.    Subject to subsections (ii) and (iii) below, in the event of a merger of the Company with or into another corporation, or the sale of substantially all of the assets of the
Company (a “Merger”), each outstanding Option and Stock Purchase Right shall be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation (the “Successor
Corporation”). In the event that the Successor Corporation refuses to assume or substitute for the Option or Stock Purchase Right, the Optionee shall fully vest in and have the right to exercise the Option or Stock Purchase Right as to all of
the Optioned Stock, including Shares as to which it would not otherwise be vested or exercisable. If an Option or Stock Purchase Right becomes fully vested and exercisable in lieu of assumption or substitution in the event of a Merger, the
Administrator shall notify the Optionee in writing or electronically that the Option or Stock Purchase Right shall be fully vested and exercisable for a period of fifteen (15) days from the date of such notice, and the Option or Stock Purchase Right
shall terminate upon the expiration of such period. For the purposes of this Section 14(c), the Option or Stock Purchase Right shall be considered assumed if, following the Merger, the option or right confers the right to purchase or receive, for
each Share of Optioned Stock subject to the Option or Stock Purchase Right immediately prior to the Merger, the consideration (whether stock, cash, or other securities or property) received in the Merger by holders of Common Stock for each Share
 
 

 12 

 
held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Merger is not solely common stock of the Successor Corporation or its Parent, the Administrator may, with the consent of the Successor Corporation, provide for the consideration to be
received upon the exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock subject to the Option or Stock Purchase Right, to be solely common stock of the Successor Corporation or its Parent equal in fair market value to the
per share consideration received by holders of Common Stock in the Merger. 
  
 (ii)    Employee and
Consultant Options. 
  
 (A)    General.    In the event of a Merger in which
the stockholders immediately prior to the Merger hold less than 50% of the outstanding voting equity securities of the Successor Corporation immediately after such Merger (a “Change of Control Merger”), then (i) the vesting of each
outstanding Option and Stock Purchase Right shall be deemed vested to the extent each such outstanding Option and Stock Purchase Right would have been vested on the date twelve (12) months following the effectiveness of the Change of Control Merger
and (ii) each outstanding Option and Stock Purchase Right held by an Employee or Consultant (and granted to such person in such capacity) shall be assumed or an equivalent option or right substituted by the Successor Corporation. In the event that
the Successor Corporation refuses to assume or substitute for the Option or Stock Purchase Right, the Employee or Consultant shall, as set forth in subsection (i) above, fully vest in and have the right to exercise such Option or Stock Purchase
Right as to all of the Optioned Stock, including Shares as to which the Employee or Consultant would not otherwise be vested or exercisable. 
  
 (B)    Employee and Consultant Options Following Assumption or Substitution.    Following an assumption or substitution in connection with a Merger or Change of Control
Merger, if an Employee or Consultant’s status as an Employee (or employee) or Consultant (or consultant) of the Successor Corporation, as applicable, is terminated by the Successor Corporation as a result of an involuntary termination (other
than for Cause) within twelve months following the Merger, the Optionee shall fully vest in and have the right to exercise Optionee’s Option or Stock Purchase Right as to all of the Optioned Stock, including Shares as to which Optionee would
not otherwise be vested or exercisable. Thereafter, the Option or Stock Purchase Right shall remain exercisable in accordance with Section 10. 
  
 (iii)    Outside Director Options.    In the event of a Change of Control Merger, each outstanding Option and Stock Purchase Right held by an Outside Director (and
granted to such person in such capacity) shall fully vest as to all of the Optioned Stock, including Shares as to which the Outside Director would not otherwise be vested or exercisable. If an Option or Stock Purchase Right becomes fully vested and
exercisable as provided in this paragraph, the Administrator shall notify the Optionee in writing or electronically that the Option or Stock Purchase Right shall be fully vested and exercisable for a period of fifteen (15) days from the date of such
notice, and the Option or Stock Purchase Right shall terminate upon the expiration of such period. 
  
 15.    Date of Grant.    The date of grant of an Option or Stock Purchase Right shall be, for all purposes, the date on which the Administrator makes the determination granting such Option or
 
 

 13 

 
Stock Purchase Right, or such other later date as is determined by the Administrator. Notice of the determination shall be provided to each Optionee within a reasonable time after the date of
such grant. 
  
 16.    Amendment and Termination of the Plan. 
  
 (a)    Amendment and Termination.    The Board may at any time amend, alter, suspend or terminate the
Plan. 
  
 (b)    Shareholder Approval.    The Company shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws. 
  
 (c)    Effect of Amendment or Termination.    No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise between
the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not affect the Administrator’s ability to exercise the powers granted to it hereunder with respect
to Options granted under the Plan prior to the date of such termination. 
  
 17.    Conditions Upon Issuance
of Shares. 
  
 (a)    Legal Compliance.    Shares shall not be issued pursuant
to the exercise of an Option or Stock Purchase Right unless the exercise of such Option or Stock Purchase Right and the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel
for the Company with respect to such compliance. 
  
 (b)    Investment
Representations.    As a condition to the exercise of an Option or Stock Purchase Right, the Company may require the person exercising such Option or Stock Purchase Right to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required. 
  
 18.    Inability to Obtain Authority.    The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been obtained. 
  
 19.    Reservation
of Shares.    The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan. 
  
 20.    Shareholder Approval.    The Plan shall be subject to approval by the shareholders of the Company
within twelve (12) months after the date the Plan is adopted. Such shareholder approval shall be obtained in the manner and to the degree required under Applicable Laws. 
 

 14 

  
 APPENDIX A 
  
 Rules for French Option Grants 
  
 The following rules shall apply in the case of Option
grants to French residents. 
  
 1.    Definitions.    As used herein, the following
definitions shall apply: 
  
 (a)    “Applicable Laws” means the legal requirements relating to
the administration of stock option plans under French corporate, securities, and tax laws. 
  
 (b)    “Disability” means total and permanent disability, as defined under Applicable Laws. 
  
 (c)    “Employee” means any person, including officers and Directors, employed by the Company or any Parent or Subsidiary of the Company, (i) who does not own more than 10% of the
voting power of all classes of stock of the Company, or any Parent or Subsidiary of the Company, and (ii) who is a resident of the Republic of France. 
  
 (d)    “Fair Market Value” means, as of any date, the dollar value of Common Stock determined as follows: 
  

	 	(i)
	 
	If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market of the Nasdaq Stock Market,
its Fair Market Value shall be the greater of (i) the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as
reported in The Wall Street Journal or such other source as the Administrator deems reliable or (ii) the average quotation price for the last 20 days preceding the date of determination for such stock (or the average closing bid for such 20
day period, if no sales were reported) as quoted on such exchange or system and reported in The Wall Street Journal or such other source as the Administrator deems reliable; 
 

  

	 	(ii)
	 
	If the Common Stock is quoted on the Nasdaq Stock market (but not on the Nasdaq National Market thereof) or regularly quoted by a recognized securities dealer but selling
prices are not reported, its Fair Market Value shall be the higher of (i) the average of the high bid and low asked prices for the Common Stock for the last market trading day prior to the time of determination or (ii) the mean between the high bid
and low asked prices for the Common Stock for the last 20 days preceding the date of determination, as applicable; or 
 

  

	 	(iii)
	 
	In the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the Administrator. 

 

 15 

  
 2.    Eligibility.    Options granted pursuant
to this Appendix A may be granted only to Employees; provided, however, that the Président Directeur Général, the Directeur Général and other directors who are also Employees of a Subsidiary may be
granted Options hereunder. 
  
 3.    Term of Plan.    Options may be granted under
this Appendix A from the date of the adoption of the Plan by the Board. It shall continue in effect until the date five years from the date of its adoption, unless terminated earlier under Section 14 of the Plan. 
  
 4.    Option Price.    The Option price for the Shares to be issued pursuant to exercise of an Option
shall be determined by the Administrator upon the date of grant of the Option and stated in the Option Agreement, but in no event shall be lower than one hundred percent (100%) of the Fair Market Value on the date the Option is granted. The Option
Price cannot be modified while the Option is outstanding, except as required by Applicable Laws. 
  
 5.    Exercise of Option; Restriction on Sale. 
  
 (a)    Options granted
hereunder may be exercised at any time after the second anniversary of the date of grant to the extent they have vested. Options granted hereunder shall vest, subject to Optionee’s continuing status as an Employee on such dates, in accordance
with the following vesting schedule: 50% of the Shares subject to the Option shall vest on the second (2nd) anniversary
of the Option’s date of grant (the “Initial Vest Date”) and 1/48th of the Shares subject to the Option
shall vest each month thereafter, so that 100% of the Optioned Stock shall be exercisable after four (4) years. 
  
 An Option shall
be deemed exercised when the Company receives: (i) written or electronic notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the
Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the
Optionee or, if required by the Optionee, in the name of the Optionee and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no
right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Shares, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is
exercised. No adjustment will be made for a dividend or other right for which the record date is prior to the date the shares are issued, except as provided in Section 12 of the Plan. 
  
 (b)    The Shares subject to this Option may not be transferred, assigned or hypothecated in any manner otherwise than by will or by the laws of descent or
distribution before the date three (3) years from the Initial Vest Date; provided, however, that the duration of this restriction on sale shall be automatically adjusted to conform with any changes to the holding period required for favorable tax
and social security treatment under Applicable Laws. 
  
 (c)    Termination of Employment
Relationship.    In the event that an Optionee’s status as an Employee terminates (other than upon the Optionee’s death or Disability), the Optionee may exercise his or her Option, but only within such period of
time as is determined by the
 
 

 16 

 
Administrator and only to the extent that the Optionee’s Option has vested at the date of termination (but in no event later than the expiration of the term of such Option as set forth in
the Option Agreement). If, at the date of termination, the Optionee’s Option has not fully vested, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or
her Option within the time specified by the Administrator, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  
 (d)    Disability of Optionee.    In the event that an Optionee’s status as an Employee terminates as a result of the Optionee’s Disability, the Optionee may
exercise his or her Option at any time within twelve (12) months from the date of such termination, but only to the extent that the Optionee’s Option has vested at the date of such termination (and in no event later than the expiration of the
term of such Option as set forth in the Option Agreement). If, at the date of termination, the Optionee’s Option has not fully vested, the Shares covered by the unexercisable portion of the Option shall revert to the Plan. If, after
termination, the Optionee does not exercise his or her Option within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  
 (e)    Death of Optionee.    In the event of the death of an Optionee while an Employee, the Option may be exercised at any time within
twelve (12) months following the date of death by the Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent that the Optionee’s Option has vested at the date of
death (and in no event later than the expiration of the term of such Option as set forth in the Option Agreement). If, at the time of death, the Optionee’s Option has not fully vested, the Shares covered by the unexercisable portion of the
Option shall revert to the Plan. If, after death, the Optionee’s estate or a person who acquired the right to exercise the Option by bequest or inheritance does not exercise the Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall immediately revert to the Plan. 
 

 17<PAGE>

CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS OMITTED INFORMATION HAS BEEN REPLACED BY [*].

                                                                   EXHIBIT 10.14

                          SOFTWARE LICENSING AGREEMENT

THIS SOFTWARE LICENSE AGREEMENT is entered into as of this 4th day of August
1999 (hereinafter "Effective Date") by and between Dell Products L.P.
(hereinafter "Dell") with its principal place of business at One Dell Way, Round
Rock, Texas 78682, and Intervideo, Inc., a California corporation having a
principal place of business at 47350 Fremont Blvd., Fremont, CA 94538
(hereinafter "Licensor").

1.0      DEFINITIONS

1.1      Agreement shall mean this Software License Agreement and its
         Supplement.

1.2      Licensed Product(s) shall mean: (i) the software and documentation
         listed in the Supplement to this Software License Agreement and (ii)
         all improvements, corrections, modifications, alterations, revisions,
         extensions, upgrades, national language versions and/or enhancements to
         the software and/or documentation made during the term of this
         Agreement (hereinafter "Updates").

1.3      Supplement shall mean the supplement executed under this Software
         License Agreement. The supplement shall describe the Licensed
         Product(s) and may include additional terms and conditions such as
         compensation, delivery schedules, technical contacts and other
         information related to the Licensed Product(s). The terms and
         conditions of this Software License Agreement shall apply to the
         Supplement.

2.0      OBJECT CODE LICENSE WITH SOURCE CODE ESCROW PROVISIONS

2.1      Licensor hereby grants to Dell a non-exclusive, worldwide, irrevocable
         right and license, under all copyrights, patents, patent applications,
         trade secrets and other necessary intellectual property rights, to: (i)
         use, make, execute, reproduce, display, perform and prepare derivative
         works of, the Licensed Product(s), in object code form, (ii)
         distribute, license, sublicense, sell, lease or otherwise transfer the
         Licensed Product(s), in object code form, as part of, in conjunction
         with, or for use with, Dell systems and (iii) authorize, license and
         sublicense third parties to do any, some or all of the foregoing. Dell
         shall have the option to distribute the Licensed Product(s) to end
         users pursuant to Dell's or Licensor's end user license agreement or
         the like, as updated from time to time.

2.2      The above grant includes, without limitation, the right and license to:
         (i) use Licensor's trade names, product names and trademarks in
         connection with the marketing and distribution of Licensed Product(s)
         and (ii) all pictorial, graphic and audio visual works including icons,
         screens and characters created as a result of execution of the Licensed
         Product(s).

2.3      Upon Dell's request, Licensor agrees to place into escrow the Licensed
         Product(s), in source code form, and all build tools and other
         materials necessary to enable Dell to maintain and service the Licensed
         Product(s) in object code from ("hereinafter Escrow Materials"). Dell
         shall be responsible for paying the escrow agent's fees. Dell agrees
         not to exercise its license to the Escrow Materials set forth below
         unless and until the Escrow Materials are released to

<PAGE>

         Dell by the escrow agent. The escrow agent may only release the Escrow
         Materials to Dell under the following circumstances: (i) Licensor
         becomes insolvent, (ii) a claim of bankruptcy if filed by or on behalf
         of Licensor, (iii) Licensor makes an assignment for the benefit of a
         creditor or (iv) Licensor ceases to do business in the normal course.
         Under all circumstances, ownership of the Licensed Product shall remain
         with IVI.

2.4      Licensor hereby grants to Dell a non-exclusive, worldwide, irrevocable
         right and license, under all copyrights, patents, patent applications,
         trade secrets and other necessary intellectual property rights, to
         internally: (i) use, execute, reproduce, display, perform, prepare
         derivative works of, the Licensed Product(s), in source code form, for
         the purposes of enabling Dell to maintain, service and manufacture the
         Licensed Product(s) and (ii) authorize, license and sublicense third
         parties to do any, some or all of the foregoing on Dell's behalf.

3.0      COMPENSATION; PER COPY ROYALTIES

3.1      Dell will pay Licensor a [*] royalty as set forth in the Supplement for
         each copy of the Licensed Product(s) distributed by Dell for revenue.
         No [*] royalties shall be due for copies of the Licensed Product(s):
         (i) [*] (ii) used or distributed for demonstration, marketing or
         training purposes, (iii) distributed to a customer as a replacement
         for a defective copy or to fix an error, (iv) used to repair or
         maintain a customer's system, (v) used for backup or archival purposes,
         (vi) returned by a customer, (vii) used for manufacturing or testing
         purposes or (viii) distributed to an existing customers as an upgrade
         to their existing copy of the Licensed Product(s).

3.2      The [*] royalties set forth in the Supplement represents Dell's only
         financial obligations under this Agreement and includes all costs and
         fees. All payments shall be made in United States currency. Licensor
         acknowledges that there [*] royalty due under this Agreement and that
         any royalties received will be based solely on the criteria set forth
         above. Licensor acknowledges and agrees that Dell has the right to
         withhold any applicable taxes from any royalties due under this
         Agreement if required by any government agency.

3.3      Upon request, Dell shall submit royalty reports within [*] days after
         [*]. For the purposes of royalty reporting, as an example, Dell's
         fiscal quarters may be: Quarter 1 - February 1-April 30, Quarter 2-May
         1-July 31, Quarter 3-August 1-October 31, and Quarter 4-November
         1-January 31.

3.4      A nationally recognized accounting organization retained by Licensor
         and acceptable to Dell may have access to those records maintained by
         Dell that are necessary to determine whether Dell has paid the
         appropriate royalties based on net shipments by Licensed Product. Dell
         must receive at least sixty (60) or more days of advance written notice
         of Licensor's intent to audit. Such audit may only take place upon
         sixty (60) days written notice, during regular business hours and no
         more than once per calendar year. Only two (2) years of Dell records
         may be accessed from the date of audit, unless there is a substantial
         discrepancy which may affect additional year records. All records
         accessed during the audit shall be deemed Dell

                                      -2-

<PAGE>

         confidential information and will be treated as such in accordance with
         the confidentiality agreement in place between the parties. If no such
         agreement is in place, the parties will negotiate in good faith the
         terms of such an agreement.

3.5      If the parties discover and agree that Dell has overpaid Licensor,
         Licensor shall refund the amount of the overpayment to Dell within
         forty-five (45) days after receipt of an invoice. If the parties
         discover and agree that Dell has underpaid Licensor, Dell will pay
         Licensor the amount of the underpayment within forty-five (45) days
         after receipt of an invoice.

4.0      PRE-DELIVERY TESTING, DELIVERY AND ACCEPTANCE

4.1      Prior to delivery, Licensor shall perform all testing necessary to
         ensure that the Licensed Product(s) comply with its written
         specifications and are compatibility with Dell systems. Licensor shall
         appoint a designated systems engineer who shall be available on a [*]
         basis to support Dell in all areas relating to the Licensed
         Product(s). Such [*] systems engineer will work with Dell on any
         modifications to the Licensed Product(s) necessary to fully support
         Dell's systems and their features.

4.2      Licensor shall, at its expense, deliver a master copy of the Licensed
         Product(s) to Dell in accordance with the schedule set forth in the
         Supplement. Licensor also shall, at its expense, deliver to Dell,
         within [*] days of Dell's request, all Updates to the Licensed
         Product(s) made during the term of this Agreement, Licensor shall
         inform Dell of the existence of a major Update at least [*] days prior
         to making such an Update generally available or within [*] for a minor
         Update. Upon Dell's request, Licensor shall provide Dell with a
         pre-release copy of any Update. Licensor shall deliver a master copy
         of its standard end user license agreement and a copy of the Licensed
         Product's written specifications at the same time Licensor delivers
         the Licensed Product(s).

4.3      Upon Dell's receipt of a Licensed Product, Dell shall have [*] days to
         conduct those tests that Dell deems appropriate to determine whether
         the Licensed Product: (i) complies with its written specifications,
         (ii) contains any defects and (iii) is compatible with Dell's systems.
         If Dell discovers a problem, Dell will notify Licensor and Licensor
         will have [*] to fix the problem and deliver a corrected version of
         the Licensed Product to Dell. Upon receipt of the corrected version,
         Dell will have [*] days to test the corrected version of the Licensed
         Product. If Dell determines that there is still a problem, Dell will
         have the option of rejecting the Licensed Product or agreeing upon a
         fix strategy with Licensor. If Dell rejects the Licensed Product, any
         payments previously made by Dell to Licensor relating to the Licensed
         Product, if any, shall be refunded in their entirety within [*] of
         Dell's rejection. If Dell decides to agree on a fix strategy, such
         decision shall not be deemed an acceptance of the Licensed Product. In
         fact, each version of the Licensed Product delivered to Dell, in
         accordance with the fix strategy, will go through the acceptance
         process set forth above.

                                      -3-

<PAGE>

5.0      SUPPORT, TRAINING AND MAINTENANCE

5.1      Licensor shall, [*], train Dell personnel to set up, install, configure
         and operate the Licensed Product(s) and provide such other training to
         assist and enable Dell to fully perform and exercise its rights under
         this Agreement. Such training shall be completed [*] days prior to
         Dell's commercial introduction of the Licensed Product(s). Additional
         training periods for Updates shall also be provided [*] and within a
         mutually agreed upon time period.

5.2      During the term of this Agreement, Licensor shall, [*], provide to Dell
         ongoing technical support, maintenance and services for the Licensed
         Product(s). Should Licensor become aware of any reproducible errors or
         be notified by Dell or any errors in the Licensed Product(s), Licensor
         shall promptly take appropriate measures to correct such errors and
         provide such corrections in accordance with the time frames set forth
         below. Licensor shall provide, [*], assistance in correcting
         difficulties caused by errors, including, but not limited to, phone
         for Dell customer service staff. Licensor agrees to provide any other
         appropriate service to ensure the proper installation, operation, and
         functioning of the Licensed Product(s).

5.3      Dell will notify Licensor of any problems discovered with the Licensed
         Product(s). Such notification may be in writing or oral. Timely
         turnaround to software problem reports will be required. Problems must
         be fixed within the following timeframes:

         Major Defect                                Correction
         ------------                                ----------

         Licensor acknowledgment and description     Work-around or patch within
         of course of action within [*] of           [*].
         notification by Dell.

         Minor Defect                                Correction
         ------------                                ----------
         Licensor acknowledgement and description    Work around or patch
         of course of action within [*] of           within [*].
         notification by Dell.

         Major Defect is any problem with the use of Licensed Product(s) that
         either fully or partially impairs the use or operation of the Licensed
         Product by Dell or Dell's customers or licensees. Minor Defect is any
         problem that is outside of the Major Defect definition.

6.0      REPRESENTATIONS AND WARRANTIES

         On an ongoing basis, Licensor represents and warrants that:

          (a) the Licensed Product(s) will operate in accordance with its
              written specifications;

          (b) Licensor has [*] in the Licensed Product(s) to grant Dell the
              rights and licenses contained in this Agreement;

                                       -4-

<PAGE>

          (c) the Licensed Product(s) [*] of any third party;

          (d) the Licensed Product(s) does not contain any known viruses,
              expiration, time-sensitive devices or other harmful code that
              would inhibit the end user's use of the Licensed Product(s) or
              Dell system;

          (e) if applicable, the Licensed Product(s) shall be able to accurately
              process date data (including, but not limited to, displaying,
              calculating, comparing, and sequencing) between the twentieth and
              twenty-first centuries;

          (f) if applicable, the Licensed Product(s) is certified by Microsoft
              as PC 9X compliant or Windows Logo certified;

          (g) Licensor and the Licensed Product(s) comply with all governmental
              laws, statutes, ordinances, administrative orders, rules and
              regulations and that Licensor has procured all necessary licensees
              and paid all fees and other charges required so that Dell can
              exercise the rights and license granted under this Agreement;

          (h) Licensor has obtained a waiver or agreement not to assert any
              moral rights from any person or entity having any moral rights
              with respect to the Licensed Product(s) and Licensor shall not
              assert any moral rights Licensor or its employees may have in the
              Licensed Product(s);

          (i) the Licensed Product(s) are not encrypted, nor do they contain
              encryption capability;

          (j) there is no restriction of any relevant governmental authority
              which prohibits the export of the Licensed Product(s) to countries
              outside the United States and Canada, other than those laws of the
              United States which prohibit exports generally to specified
              countries, currently: Libya, Cuba, Montenegro, North Korea,
              Serbia, Syria, Sudan, Iran and Iraq, as amended from time to time
              by the United States Government; and

          (k) Licensor has and will continue to comply with all applicable
              governmental laws, statutes, rules and regulations including, but
              not limited to, those related to export of product and technical
              data, and Licensor agrees that for any updates, upgrades and new
              products which are licensed to Dell pursuant to the terms of this
              Agreement. Licensor shall provide prior written notice of any
              facts which would make the foregoing representations untrue.

          In the event that Dell chooses to use Licensor's end user license
          agreement, Licensor hereby makes the following additional ongoing
          representations and warranties:

          (l) Licensor will warrant the Licensed Product(s) directly to the
              end-user in accordance with the terms and conditions set forth in
              Licensor's end-user license agreement; and

          (m) Licensor has agreed to honor all replacement requests received
              from Dell or end users under the terms of the end user license
              agreement pertaining to defective Licensed Product(s).

7.0       INDEMNIFICATION

7.1       Licensor shall indemnify, defend and hold harmless Dell, Dell Computer
          Corporation, Dell Computer Corporation's subsidiaries and affiliates
          and all of the foregoing entities' officers, directors, employees,
          agents, customers and licensees, and their successors and assigns,
          from

                                      -5-

<PAGE>

      and against any and all claims, actions, suits, legal proceedings,
      demands, liabilities, damages, losses, judgments, settlements, costs and
      expenses, beyond the liability limitations listed in section 9.2,
      including attorney's fees, arising out of or in connection with any
      alleged or actual:

          (i)   infringement by Licensor and/or the Licensed Product(s) of any
          copyright, patent, trade secret or other intellectual property rights
          or similar rights of any third party, except those listed in 7.4;

          (ii)  breach by Licensor and/or the Licensed Product(s) of any other
          representation and/or warranties contained in this Agreement; and

          (iii) damage to any property, personal injury, death or any other
          damages or losses sustained by whomever suffered, resulting, or
          claimed to result, in whole or in part from any alleged or actual
          defect in the Licensed Product(s) whether latent or patent, including
          any alleged or actual improper construction or design or the failure
          of the Licensed Product(s) to comply with its written specifications
          or any express or implied warranties.

7.2   In the event that Dell becomes aware of any such claim, Dell shall: (i)
      notify Licensor of such claim, (ii) cooperate with Licensor in the defense
      thereof and (iii) obtain Licensor's approval prior to settling any such
      claim, provided such consent is not unreasonably withheld.

7.3.1 In addition to Licensor's obligations under Subsection 7.1 above, in the
      event that a claim of infringement is made with regard to the Licensed
      Product(s), Licensor shall, at its own expense, procure for Dell the right
      to exercise the rights and licenses granted to Dell under this Agreement
      or modify the Licensed Product(s) such that it is no longer infringing.

8.0   TERM AND TERMINATION OF AGREEMENT

8.1   Unless earlier terminated as provided below, the term of this Agreement
      shall be for three (3) years from the Effective Date and, unless either
      party gives thirty (30) days notice of non-renewal prior to the end of the
      initial term, this Agreement shall automatically renew for successive one
      (1) year periods.

8.2   If either party hereto materially breaches any of the terms and conditions
      of this Agreement, the other party may give written notice to the
      defaulting party specifying the actions or omissions which constitute a
      material breach of this Agreement, and in the event that any material
      breach so indicated shall not be remedied by the defaulting party within
      thirty (30) days after such notice, the party not in default may by
      further written notice to the defaulting party terminate this Agreement,
      and, except as expressly provided otherwise in this Agreement, this
      Agreement and all the rights and obligations contained herein shall
      terminate five (5) days after the defaulting party's receipt of such
      notice of termination. Failure of either party to so terminate this
      Agreement due to a material breach on the part of the other party shall
      not prejudice its rights to terminate for a subsequent material breach by
      the other.

                                       -6-

<PAGE>

8.3   All licenses and sublicenses granted to customers and other licensees
      under this Agreement, and all provisions of Sections 6.0, 7.0, 8.0, 9.0,
      10.0 and 11.0, shall survive any expiration or termination of this
      Agreement and shall bind the parties and their successors, heirs, assigns
      and legal representatives. In addition, Licensor's obligations under
      Section 4 and 5 shall survive for [*] after any expiration or termination
      of this Agreement in order for Dell to satisfy its then existing
      contractual obligations to its customers and licensees. Dell shall retain
      a limited license in accordance with Section 2 to use the Licensed
      Product(s) in order to satisfy such obligations and to exhaust its
      inventory of Licensed Product(s) existing at expiration or termination,
      provided that Dell's right to exhaust any such inventory shall not extend
      beyond [*] after expiration or termination. Thereafter, Dell agrees to
      return or destroy all additional copies of the Licensed Product(s) in its
      possession.

9.0   LIMITATION OF LIABILITIES

9.1   EXCEPT AS SET FORTH BELOW, NEITHER PARTY SHALL BE LIABLE FOR ANY INDIRECT,
      INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES UNDER ANY PART OF THIS
      AGREEMENT EVEN IF ADVISED OR AWARE OF THE POSSIBILITY OF SUCH DAMAGES.

9.2   THE LIMITATIONS OF LIABILITY SET FORTH ABOVE, SHALL NOT APPLY TO ANY OF
      LICENSOR'S OBLIGATIONS OR LIABILITIES UNDER SECTION 6 "REPRESENTATIONS AND
      WARRANTIES" AND SECTION 7 "INDEMNIFICATION". LICENSEE'S SOLE AND TOTAL
      LIABILITY FOR ANY CAUSE OF ACTION SHALL BE LIMITED TO A MAXIMUM OF FIFTY
      PERCENT (50%) OF THE PAYMENTS PREVIOUSLY MADE OR DUE BY LICENSEE TO
      LICENSOR UNDER THIS AGREEMENT.

10.0  CONFIDENTIAL INFORMATION

10.1  The parties agree that information exchanged under this Agreement that is
      considered by either party to be confidential information will be subject
      to the terms and conditions of the non-disclosure agreement in place
      between the parties. If the parties have not executed a non-disclosure
      agreement, the parties will negotiate in good faith the terms of such an
      agreement. Licensor shall not provide to Dell any information that is
      considered confidential information of any third party.

11.0  MISCELLANEOUS

11.1  This Agreement shall in no way preclude Dell from independently
      developing, having developed or acquiring or marketing any products or
      services nor shall it in any way preclude Dell from entering into any
      similar agreement with any other party.

11.2  Dell shall have full freedom and flexibility in its decisions concerning
      the distribution and marketing of the Licensed Product(s) including,
      without limitation, the decision of whether or not to distribute or
      discontinue distribution of the Licensed Product(s). Dell does not
      guarantee that its marketing, of the Licensed Product(s) will be
      successful.

                                       -7-

<PAGE>

11.3  Neither this Agreement or any rights or obligations contained therein, may
      be assigned or delegated by Licensor without the prior written consent of
      Dell. Such consent shall not be unreasonably be withheld.

11.4  Licensor is an independent contractor. Licensor is not a legal
      representative or agent of Dell, nor shall Licensor have the right or
      authority to create or incur any liability or any obligation of any kind,
      express or implied, against, or in the name of, or on behalf of Dell.

11.5  [*]

11.6  Licensor shall not publicize the existence of this Agreement with Dell nor
      refer to Dell in connection with any promotion or publication without the
      prior written approval of Dell. Further, Licensor shall not disclose the
      terms and conditions of this Agreement to any third party, including, but
      not limited to, any financial terms, except as required by law or with
      Dell's prior written consent.

11.7  Licensor shall comply with all applicable governmental laws, statutes,
      ordinances, administrative orders, rules and regulations including,
      without limitation, those related to the export of technical materials.
      Licensor shall provide Dell with prompt written notice of any export
      restrictions related to the Licensed Product(s).

11.8  Any and all written notices, communications and deliveries between
      Licensor and Dell with reference to this Agreement shall be deemed made on
      the date of mailing if sent by registered or certified mail to the
      respective address of the other party as follows:

           In the case of Dell:            Dell Products L.P.
                                           One Dell Way
                                           BBP, Box 4
                                           Round Rock, TX 78682
                                           Attn: Strategic Commodity Manager
                                                 Software Procurement

           In the case of Licensor:        Intervideo
                                           47350 Fremont Blvd.
                                           Fremont, CA 94538
                                           Attn: Joe Monastiero
                                                 VP of Marketing & Sales

11.9  This Agreement shall be governed by and interpreted in accordance with the
      laws of the State of Texas, U.S.A. without regards for its rules of
      conflict of laws, as if this Agreement was executed in and fully performed
      within the State of Texas. Both parties hereby waive any

                                       -8-

<PAGE>

      right to a trial by jury relating to any dispute arising under or in
      connection with this Agreement.

11.10 Should any provision herein be held by a court of competent jurisdiction
      to be illegal, invalid or unenforceable, such provision shall be modified
      to reflect the intentions of the parties. All other terms and conditions
      shall remain in full force and effect.

11.11 No amendment, modification or waiver of any provision of this Agreement
      shall be effective unless set forth in a writing executed by an authorized
      representative of each party. No failure or delay by either party in
      exercising any right, power or remedy will operate as a waiver of any such
      right, power or remedy. No waiver of any provision of this Agreement shall
      constitute a continuing waiver or a waiver of any similar provision unless
      expressly set forth in a writing signed by an authorized representative of
      each party.

11.12 Since Dell transacts business with the United States government, Licensor
      must comply with the applicable federal laws and Federal Acquisition
      Regulations ("FARs") including the following:

          It is Dell's policy to take affirmative action to provide equal
          employment opportunity without regard to race, religion, color,
          national origin, age, sex, disability, veterans status or any other
          legally protected status. As a condition of doing business, Dell
          requires Licensor to practice equal opportunity employment and to
          comply with Executive Order 11246, as amended, Section 503 of the
          Rehabilitation Act of 1973, and Section 4212 of the Vietnam Era
          Veteran's Readjustment Assistance Act of 1974, all as amended, and the
          relevant Regulations and Orders of the U.S. Secretary of Labor.
          Additionally, to the extent required by applicable law, the following
          sections of Chapter 60 of Title 41 of the Code of Federal Regulations
          are incorporated by reference in this Agreement and each Order: 41 CFR
          60-1.4(a); 41 CFR 60-1.8; 41 CFR 60-741; 41 CFR 60-250; 41 CFR 60-1.7;
          41 CFR 60-1.40.

          It is the policy of the United States (FAR 52.219-8) that small
          business concerns, small business concerns owned and controlled by
          socially and economically disadvantaged individuals and small business
          concerns owned and controlled by women shall have the maximum
          practicable opportunity to participate in performing contracts for any
          Federal agency. Licensor agrees to comply with this policy and to
          provide reporting of data as requested to the Small Business Liaison
          Officer, Dell Computer Corporation, One Dell Way, Round Rock, Texas,
          78682.

11.13 This Agreement sets forth the entire agreement and understanding of the
      parties relating to the subject matter contained herein, and merges all
      prior discussions and agreements, both oral and written, between the
      parties. Nothing in any purchase order, invoice, order acknowledgment, or
      other document of Licensor shall be of any effect whatsoever and may not
      affect, alter, or modify the terms and conditions of this Agreement. If
      the terms and

                                       -9-

<PAGE>

          conditions of this Agreement conflict with any terms of a Dell
          purchase order relating to the Licensed Product(s), the terms and
          conditions of this Agreement shall govern. The terms and conditions
          set forth in Supplements are hereby incorporated into this Software
          License Agreement by reference. If the terms and conditions of this
          Software License Agreement conflict with any terms and conditions
          contained in a Supplement, the terms and conditions of the Supplement
          shall govern.

IN WITNESS WHEREOF, the parties hereto have duly executed this Software License
Agreement by their respective duly authorized officers to be effective as of the
Effective Date as first written above.

DELL PRODUCTS L.P.                          INTERVIDEO, INC.

By:     /s/ Sharon Peterson                 By:     /s/ Joe Monastiero
    ---------------------------------           --------------------------------

Title:  Dir, WWSP                           Title:  V.P.
       ------------------------------              -----------------------------

Date:   8/13/1999                           Date:   August 4th, 1999
      -------------------------------             ------------------------------
                                      -10-

<PAGE>

                          SOFTWARE LICENSING AGREEMENT

THIS SUPPLEMENT is entered into as of this 4th day of August 1999 by and between
Dell Products L.P. (hereinafter "Dell") with its principal place of business at
One Dell Way, Round Rock, Texas 78682, and Intervideo, Inc., a California
corporation having a principal place of business at 47350 Fremont Blvd.,
Fremont, CA 94538 (hereinafter "Licensor").

This Supplement provides additional terms and conditions to the above referenced
Software License Agreement. All terms and conditions of the Software License
Agreement apply to this Supplement and the terms and conditions of this
Supplement are hereby incorporated by reference into the Software License
Agreement.

1.0  DESCRIPTION OF LICENSED PRODUCT(S)

I.   Licensed Software:

A.   WinDVD(TM)

          Software is personal computer application software object code
          including modules for MPEG-2 video decode, Dolby Digital/MPEG audio
          decode, an audio/video synchronization engine, a DVD Navigator, Copy
          Protection Software, and a Graphical User Interface. Version delivered
          is to be used as a software bundle with Licensee's hardware products.

B.   Technical specifications:

     1.   Video Decoding Support

               A.   Input Supported

                         - MPEG-1 Video Decoding (ISO/IEC 11172)
                         - MPEG-2 Video Decoding (ISO/IEC 13818)

               B.   Video Output Supported

                         - Up to 720 X 480 (NTSC)
                         - Up to 720 X 576 (PAL)

               C.   VGA Output Requirements For Licensee System

                         - Direct Draw Support for HW video window
                         - Color space conversion
                         - Color key support

               D.   Licensee System Requirements

                         - Intel MMX processor (PII preferred) or compatible
                           processor

<PAGE>

     2.   Audio Decoding Support

               A.   Dolby Digital AC-3

                         Input
                         - 48 kHz sampling rate
                         - 2 channel AC-3 encoded
                         - 5.1 channel AC-3 encoded

                         Output
                         - 2 channel stereo decoded stream
                         - 2 channel Pro-Logic encoded stream
                         - 16 bit Class "C" Dolby Certification

               B.   MPEG-1 Audio
                         - MPEG 1 Audio Decoding (ISO/IEC 11172)

     3.   Decoder Licensed Software Configuration

               -    MPEG 1 & 2 Video Decoding
               -    Dolby Digital AC-3 audio decoding
               -    MPEG-1 2 channel audio decoding
               -    Video/Audio Synchronization
               -    MP3 audio decoding
               -    VCD 1.0/1.1/2.0 title playback

     4.   Navigation

               - Conforms substantially to the "DVD Specifications for read-only
                 Disc Version 1.0 Part 3 Video Specifications."

     5.   Graphical User Interface

               A.   Playback Control
                      - Fast Forward           - Volume Control
                      - Fast Backward          - Select drive
                      - Next Chapter           - Eject
                      - Previous Chapter       - Repeat
                      - Stop                   - Smooth Slow Motion
                      - Pause                  - Smooth Fast Forward
                      - Help                   - Play
                      - Time Line Search       - Brightness Control
                      - Keypad Input           - Title/Chapter Loop

               B.   Navigator Functions
                         - Audio language selection
                         - Parental control

                                       -2-

<PAGE>

                              - Viewing angle selection
                              - Subtitle selection
                              - Select Titles/Menus
                                      - Title
                                      - Root
                                      - Audio
                                      - Subtitle
                                      - Menu
                                      - Chapter

     6.   Copy Protection (Navigator use only)

               A.   Regionalization
                         - Supports DVD regionalization code

               B.   Decryption
                         - Substantially supports CSS de-scambling and tamper
                           resistance requirements

               C.   Macrovision Requirements
                         - Required if NTSC encoder is used (Navigator
                           implementation only)

     7.   Localization
               -    IVI will provide support for English, Dutch, French,
                    Spanish, German, Italian, Traditional Chinese and Japanese
                    languages in our installation procedure and help files.

2.0  COMPENSATION

OEM Bundled Pricing:

 ---------------------------------------------------------------------------
       Monthly Units                  Quarterly Units
 ---------------------------------------------------------------------------
     [*]    -    [*]              [*]          -     [*]             $[*]
 ---------------------------------------------------------------------------
     [*]    -    [*]              [*]          -     [*]             $[*]
 ---------------------------------------------------------------------------
     [*]    -    +                [*]          -     +               $[*]
 ---------------------------------------------------------------------------

If InterVideo is to pass through the Dolby royalty to Dolby, please add $[*] for
2 channels.

DellPlus Pricing:

$[*] per unit. Dell will be responsible for all replication costs and cost of
materials.

3.0  DELIVERY SCHEDULE

Within 5 days of final qualification by Dell.

                                      -3-

<PAGE>

4.0  TECHNICAL CONTACTS

     David Silva, Applications Engineer
     Chinn Chin, VP of Engineering
     Chris Grell, Program Manager

IN WITNESS WHEREOF, the parties hereto have duly executed this Supplement to the
above referenced Software License Agreement by their respective duly authorized
officers.

DELL PRODUCTS L.P.                          INTERVIDEO, INC.

By:     Sharon Peterson                    By:      Joe Monastiero
    --------------------------------            --------------------------------

Title:  Dir, WWSP                          Title:   V.P.
       -----------------------------               -----------------------------

Date:   8/13/1999                           Date:   August 4th, 1999
      ------------------------------              ------------------------------

                                      -4-

<PAGE>

                          SOFTWARE LICENSING AGREEMENT
                                 Supplement Two

THIS AMENDED AND RESTATED SUPPLEMENT Two is entered into as of this 31st day of
July 2000 (the "Supplement") by and between Dell Products L.P. (hereinafter
"Dell") with its principal place of business at One Dell Way, Round Rock, Texas
78682, and Intervideo, Inc., a California corporation having a principal place
of business at 47350 Fremont Blvd., Fremont CA 94538 (hereinafter "Licensor").

Dell and Licensor are parties to a Software License Agreement entered into as of
the 4th day of August 1999 (the "Software License Agreement") and a Supplement
entered into as of the same date (the "First Supplement"). As of the date
hereof, this Supplement Two will supercede the First Supplement.

This Supplement provides additional terms and conditions to the above referenced
Software License Agreement. All terms and conditions of the Software License
Agreement apply to this Supplement and the terms and conditions of this
Supplement are hereby incorporated by reference into the Software License
Agreement.

1.0  DESCRIPTION OF LICENSED PRODUCT(S)

I.   Licensed Software:

A.   WinDVD(TM)

          Software is personal computer application software object code
          including modules for MPEG-2 video decode, Dolby Digital/MPEG audio
          decode, an audio/video synchronization engine, a DVD Navigator, Copy
          Protection Software, and a Graphic User Interface. Version delivered
          is to be used as a software bundle with Licensee's hardware products.

B.   Technical specifications:

     1.   Video Decoding Support

           A.  Input Supported

                    - MPEG-1 Video Decoding (ISO/IEC 11172)
                    - MPEG-2 Video Decoding (ISO/IEC 13818)

           B.  Video Output Supported

                    - Up to 720 X 480 (NTSC)
                    - Up to 720 X 576 (PAL)

<PAGE>

         C.    VGA Output Requirements For Licensee System

                  - Direct Draw Support for HW video window
                  - Color space conversion
                  - Color key support

         D.    Licensee System Requirements

                  - Intel MMX processor (PII preferred) or compatible processor

    2.   Audio Decoding Support

         A.    Dolby Digital AC-3

                  Input
                  - 48kH sampling rate
                  - 2 channel AC-3 encoded
                  - 5.1 channel AC-3 encoded

                  Output
                  - 2 channel stereo decoded stream
                  - 2 channel Pro-Logic encoded stream
                  - 16 bit Class "C" Dolby Certification

         B.    MPEG-1 Audio

                  - MPEG-1 Audio Decoding (ISO/IEC 11172)

    3.   Decoder Licensed Software Configuration

                  -  MPEG 1 & 2 Video Decoding
                  -  Dolby Digital AC-3 audio decoding
                  -  MPEG-1 2 channel audio decoding
                  -  Video/Audio Synchronization
                  -  MP3 audio decoding
                  -  VCD 1.0/1.1/2.0 title playback

    4.   Navigation

                  - Conforms substantially to the "DVD Specifications for read-
                    only Disc Version 1.0 Part 3 Video Specifications".

    5.   Graphical User Interface

         A.   Playback Control

                  - Fast Forward                        - Volume Control
                  - Fast Backward                       - Select drive

                                       -2-

<PAGE>

                           - Next Chapter                - Eject
                           - Previous Chapter            - Repeat
                           - Stop                        - Smooth Slow Motion
                           - Pause                       - Smooth Fast Forward
                           - Help                        - Play
                           - Time Line Search            - Brightness Control
                           - Keypad Input                - Title/Chapter Loop

                B.   Navigator Functions

                           - Audio language selection
                           - Parental control
                           - Viewing angle selection
                           - Subtitle selection
                           - Select Titles/Menus
                                    - Title
                                    - Root
                                    - Audio
                                    - Subtitle
                                    - Menu
                                    - Chapter

        6.      Copy Protection (Navigator use only)

                A.   Regionalization
                           - Supports DVD regionalization code

                B.   Decryption
                           - Substantially supports CSS de-scrambling and tamper
                             resistance requirements

                C.   Macrovision Requirement

                           - Required if NTSC encoded is used (Navigator
                             implementation only)
        7.      Localization

                -  IVI will provide support for English, Dutch, French, Spanish,
                   German, Italian, Traditional Chinese, Simplified Chinese,
                   Brazilian Portuguese, Korean, Thai and Japanese languages in
                   our installation procedure and help files.

II.     Licensed Software:

A.      WinDVD(TM) with Dolby Headphone

                Software is personal computer application software object code
                including modules for MPEG-2 video decode, Dolby Digital/MPEG
                audio decode, an audio/video synchronization engine, a DVD
                Navigator, Copy Protection Software, and a

                                      -3-

<PAGE>

                  Graphical User Interface. Version delivered is to be used as a
                  software bundle with Licensee's hardware products.

B.       Technical specifications:

         1.       Video Decoding Support

                  A.    Input Supported

                              - MPEG-1 Video Decoding (ISO/IEC 11172)
                              - MPEG-2 Video Decoding (ISO/IEC 13818)

                  B.    Video Output Supported

                              - Up to 720 X 480 (NTSC)
                              - Up to 720 X 576 (PAL)

                  C.    VGA Output Requirements For Licensee System

                              - Direct Draw Support for HW video window
                              - Color space conversion
                              - Color key support

                  D.    Licensee System Requirements

                              - Intel MMX processor (PII preferred) or
                                compatible processor

         2.       Audio Decoding Support

                  A.    Dolby Digital AC-3
                              Input
                              - 48kH sampling rate
                              - 2 channel AC-3 encoded
                              - 5.1 channel AC-3 encoded

                              Output
                              - 2 channel stereo decoded stream
                              - 2 channel Pro-Logic encoded stream
                              - 16 bit Class "C" Dolby Certification
                              - 5.1 channel AC-3 decoded stream
                              - Dolby Headphone decoded stream

                  B.    MPEG-1 Audio
                              - MPEG-1 Audio Decoding (ISO/IEC 11172)

         4.       Decoder Licensed Software Configuration

                        -        MPEG 1 & 2 Video Decoding

                                      -4-

<PAGE>

                         -        Dolby Digital AC-3 audio decoding
                         -        MPEG-1 2 channel audio decoding
                         -        Video/Audio Synchronization
                         -        MP3 audio decoding
                         -        VCD 1.0/1.1/2.0 title playback
                         -        Dolby Headphone audio decoding
         4.     Navigation

                         - Conforms substantially to the "DVD Specifications
                           for read-only Disc Version 1.0 Part 3 Video
                           Specifications".

         5.     Graphical User Interface

                         A.       Playback Control

                                   - Fast Forward          - Volume Control
                                   - Fast Backward         - Select drive
                                   - Next Chapter          - Eject
                                   - Previous Chapter      - Repeat
                                   - Stop                  - Smooth Slow Motion
                                   - Pause                 - Smooth Fast Forward
                                   - Help                  - Play
                                   - Time Line Search      - Brightness Control
                                   - Keypad Input          - Title/Chapter Loop

                         B.       Navigator Functions
                                          - Audio language selection
                                          - Parental control
                                          - Viewing angle selection
                                          - Subtitle selection
                                          - Select Titles/Menus
                                          - Title
                                          - Root
                                          - Audio
                                          - Subtitle - Menu - Chapter

                6.       Copy Protection (Navigator use only)

                         A.       Regionalization
                                          - Supports DVD regionalization code

                         B.       Decryption
                                          - Substantially supports CSS
                                            de-scrambling and tamper resistance
                                            requirements

                                      -5-

<PAGE>

                           C.       Macrovision Requirement

                                            - Required if NTSC encoder is used
                                              (Navigator implementation only)
                  7.       Localization

                                    -       IVI will provide support for
                                            English, Dutch, French, Spanish,
                                            German, Italian, Traditional
                                            Chinese, Simplified Chinese,
                                            Brazilian Portuguese, Korean, Thai
                                            and Japanese languages in our
                                            installation procedure and help
                                            files.

         C.       Exclusion from Source Code Escrow Provisions

                  The definition of Licensed Product(s) in section 1.2 of the
                  Software Licensing Agreement shall not include the Dolby
                  Headphone processing software licensed to Licensor by Lake
                  Technology Limited for purposes of section 2.3 and 2.4 of
                  Software Licensing Agreement.

2.0      COMPENSATION
OEM Bundled Pricing:

Win DVD(TM) and WinDVD(TM)with Dolby Headphone

--------------------------------------------
         Quarterly Units
--------------------------------------------
     [*]         -         [*]      $[*]
--------------------------------------------
     [*]         -         [*]      $[*]
--------------------------------------------
     [*]         -          +       $[*]
--------------------------------------------

The quantities for all Licensed Products shall be cumulative for the purpose of
calculating royalties and shall be calculated on a quarterly basis.

A Dolby
royalty of $[*] per unit (for two channels) will be added to each WinDVD product
which includes the applicable Dolby technology.

An additional Dolby royalty of $[*] per unit will be added to each
WinDVD(TM)with Dolby Headphone product which includes the applicable Dolby
technology. The total Dolby royalty for WinDVD(TM)with Dolby Headphone product
will be $[*].

DellPlus Pricing:

Notwithstanding anything to the contrary in the Software License Agreement or
this Supplement:

The DellPlus price for the WinDVD(TM) products shall be $[*] per unit which
includes the $[*] Dolby royalty.

                                      -6-

<PAGE>

The DellPlus price for the WinDVD(TM) with Dolby Headphone product shall be
$[*] per unit which includes both the $[*] and $[*] Dolby royalties.]

Dell will be responsible for all replication costs and cost of materials.

Replacement Project:

During the period of [*], Dell shall be able to (i) offer the Licensed Product
as a [*] Upgrade for up to a maximum of [*] existing Dell Customers who
previously purchased products from Dell incorporating DvD software from a
supplier other than Licensor; and (ii) offer the Licensed Product as a no charge
Upgrade to Dell Customers that accept Dell's offer to Upgrade their operating
systems from Windows 98 to Windows Millennium Edition. Dell agrees that it will
be responsible for Dolby royalties, if any, associated with such Upgrades.

3.0      DELIVERY SCHEDULE

Within 5 days of final qualification by Dell.

4.0      TECHNICAL CONTACTS

         David Silva, Applications Engineer
         Chinn Chin, VP of Engineering
         Chris Grell, Program Manager

5.0      ADDITIONAL SUPPORT

During the term of this Agreement, Licensor shall appoint a designated Program
Manager who shall be available on a dedicated basis to support Dell in all areas
relating to the Licensed Product(s). Dell acknowledges and agrees that Licensor
shall have a reasonable period of time to [*] a Program Manager into the Dell
account. Licensor will use its reasonable efforts to hire a Program Manager in
one month and integrate the Program Manager hired into the Dell account within
[*] from the date hereof.

During the term of this Agreement, Licensor shall, [*], purchase sufficient
quantities of Rev A versions of Dell computer systems and peripherals for all
existing and newly released Dell computer systems and peripherals to provide
timely ongoing technical support, development, maintenance and services for the
Licensed Product(s). At a minimum, Licensor shall [*] [*] Dell platform.
Notwithstanding anything herein to the contrary, in no event will Licensor be
required to [*] more than [*] of Dell equipment per year for the foregoing
purposes.

6.0      OBJECT AND SOURCE CODE LICENSE

Licensor and Dell acknowledge and agree that for purposes of Section 2 of the
Software License Agreement, the phrase "Dell systems" includes add-on DVD drives
so that Dell may sell the Licensed Product(s) with DVD drives as Customer kits.

                                      -7-

<PAGE>

7.0      SOFTWARE TESTING

During the term of this Agreement, Licensor shall adhere to the following
Doublebyte Testing for all Licensed Products. In the event Dell changes third
party vendors for testing purposes, Dell will provide Licensor reasonable of
said charge.

                  Requirements For Doublebyte Testing at XXCAL
                                     7/16/99

Dell is implementing a new requirement for all Doublebyte language testing prior
to submission to Dell development. The scope of this testing is limited, at this
time, to all Multimedia devices. Dell has selected XXCAL, Inc. as the 3/rd/
party vendor to conduct this testing. All MM suppliers that sell product to Dell
will now be required to submit and pay for testing at XXCAL. This testing will
encompass all Doublebyte languages required in the business award. Below is a
breakdown of those requirements:

1.       All suppliers submitting to XXCAL will be given a discounted rate on
         hourly testing.
2.       A generic test plan for each commodity will be provided by Dell and
         will be updated periodically to reflect changes in testing methodology
         and to enhance test coverage.
3.       Japanese language testing will include functional and translational
         testing. All other languages will be tested for translation only.
4.       All HTML testing will be limited to text translation only, testing for
         format and links will be done by Dell's Information Development.
5.       All costs for initial and regression testing will be incurred by the
         supplier.
6.       All regression testing will be done at XXCAL unless capacity restraints
         at XXCAL adversely impact Dell's overall schedule.
7.       Suppliers will provide XXCAL with their schedule for test submission as
         early in the process as possible to ensure proper scheduling and
         resource loading.
8.       XXCAL will send results of testing to the supplier and to the
         appropriate Dell parties upon test completion.
9.       Final signoff for acceptance into Dell will require approval signature
         from the appropriate Dell parties.
10.      Suppliers will notify Dell procurement immediately if XXCAL is unable
         to commit to required schedule.
11.      Current Doublebyte languages include but are not limited to Japanese,
         Traditional Chinese, Simplified Chinese, Thai and Korean. Those
         requirements will vary by product and will be defined in the business
         contract.

The contact at XXCAL for testing is:

                                      -8-

<PAGE>

IN WITNESS WHEREOF, the parties hereto have duly executed this Supplement to the
above referenced Software License Agreement by their respective duly authorized
officers.

DELL PRODUCTS L.P.                           INTERVIDEO, INC.

By: /s/ Illegible                            By: /s/ Kenneth Boschwitz
   ------------------------------               -----------------------------

Title: VP WW Processing                      Title: VP & General Counsel
      ---------------------------                  --------------------------

Date: 8-31-00                                Date: 30 August 2000
     ----------------------------                 ---------------------------

                                      -9-

<PAGE>

                                  AMENDMENT ONE

                                       to

                          SOFTWARE LICENSING AGREEMENT

THIS AMENDMENT ONE is entered into as of this 5th day of May, 2001 ("Effective
Date") by and between Dell Products L.P. (hereinafter "Dell") with its principal
place of business at One Dell Way, Round Rock, Texas 78682, and Intervideo,
Inc., a California corporation having a principal place of business at 47350
Fremont Blvd., Fremont, CA 94538 (hereinafter "Licensor").

Dell and Licensor are parties to a Software License Agreement entered into as of
the 4/th/ day of August, 1999 and a Supplement Two to the Software License
Agreement entered into as of the 31st day of July, 2000 (collectively the
"Agreement").

This Amendment One ("Amendment") provides additional terms and conditions to the
above referenced Software License Agreement. All terms and conditions of the
Software License Agreement apply to this Amendment and the terms and conditions
of this Amendment are hereby incorporated by reference into the Software License
Agreement. In the event of a disagreement between the terms and conditions of
the Amendment and the Agreement, the terms and conditions of this Amendment
shall control.

1.0      DESCRIPTION OF LICENSED PRODUCT(S)

Licensed Software: WinDVD and WinDVD with Dolby Headphone

2.0      COMPENSATION

OEM Bundled Pricing:

WinDVD(R) and WinDVD(R) with Dolby Headphone royalties will be as follows:

<TABLE>
<CAPTION>
                                                   Additional                        Total Royalty
                                                  Royalty with       Additional        for both 2
                                    Licensed         Dolby 2       Dolby royalty      Channel and
                     Volume in       Product       Channel if      for Headphone       Headphone
     Time Period       units         Royalty       supported          channel          technology
     -----------     ---------      --------      ------------     -------------     -------------
<S>                   <C>        <C>              <C>                <C>               <C>
        [*]             [*]           $[*]            $[*]              $[*]              $[*]

        [*]             [*]           $[*]            $[*]              $[*]              $[*]

        [*]             [*]           $[*]            $[*]              $[*]              $[*]
   and thereafter
</TABLE>

<PAGE>

Notwithstanding, if Dell ships [*] or more units in [*], the Royalty for the
Licensed Product will immediately decrease to $[*] per copy for that quarter and
for subsequent quarters. For, example, if Dell ships [*] units in Q2, Dell's
royalty shall be $[*] for the units shipped in [*] and subsequent quarters.

5.0      ADDITIONAL SUPPORT

During the term of this Agreement, Licensor Shall provide Program Manager
services to support Dell in all areas relating to the Licensed Product(s).
Licensor will provide a "Lead Program Manager" who will involve as many people
as necessary in order to quickly and effectively resolve current or future
issues. Licensor is not required to appoint a Program Manager dedicated to Dell.

During the term of this Agreement, [*] of Dell computer systems and
peripherals for all existing and newly released Dell computer systems and
peripherals to provide timely ongoing technical support, development,
maintenance and services for the Licensed Product(s). At a minimum, Licensor
shall [*] systems of each Dell platform. Notwithstanding anything
herein to the contrary, in no event will Licensor be required to [*] more
than $[*] of Dell equipment per year for the foregoing purposes.

This Amendment sets forth the entire agreement and understanding of the parties
relating to the subject matter contained herein, and merges all prior
and discussions and agreements, both oral and written, between the parties.

IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment One to
the above referenced Software License Agreement by their respective duly
authorized officers.

DELL PRODUCTS L.P.                         INTERVIDEO, INC.

By:                                        By:   /s/ Jesse Lechuga
    ------------------------------------       ---------------------------------

Title:                                     Title:   V.P. Sales
       ---------------------------------          ------------------------------

Date:                                      Date:    6/25/01
      ----------------------------------         -------------------------------
                                      -2-

<PAGE>

                SECOND AMENDMENT TO SOFTWARE LICENSING AGREEMENT

     THIS SECOND AMENDMENT TO THE SOFTWARE LICENSE AGREEMENT (the "Second
Amendment") is entered into as of the 29th day of April, 2002 (the "Effective
---------                                                           ---------
Date") by and between Dell Products, L.P. ("Dell") with its principal place of
----                                        ----
business at One Dell Way, Round Rock, Texas 78682 and InterVideo, Inc., a
Delaware corporation having its principal place of business at 47350 Fremont
Blvd., Fremont, California 94538 ("Licensor"), collectively (the "Parties").
                                   --------                       -------

     WHEREAS, the Parties entered into a Software Licensing Agreement on August
4, 1999, as modified by the Supplement entered into on August 4, 1999, by
Supplement Two, entered into on July 31, 2000, and by Amendment One, entered
into on May 5, 2001, and as further amended by mutual agreement (the foregoing,
collectively, the "Original License Agreement");
                   --------------------------

     WHEREAS, the Parties desire to further amend the Original License Agreement
as set forth below;

     THEREFORE, in consideration of the promises and mutual promises contained
in this Second Amendment, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree as
follows:

1.   Section 2.0 of the most recent Supplement to the Original License Agreement
     ---------------------------------------------------------------------------
shall be replaced in its entirety by:
-------------------------------------

2.0  COMPENSATION

OEM Bundled Pricing:

Royalties for (i) WinDVD(R), (ii) WinDVD(R) with Dolby 2 Channel, (iii)
WinDVD(R) with Dolby Headphone, and (iv) WinDVD(R) with Dolby 2 Channel and
Dolby Headphone:

<TABLE>
<CAPTION>
Time Period      Volume in   Licensed           Additional        Additional Dolby   Total Additional
                 units       Product Royalty    Royalty with      royalty for        Royalty for both
                                                Dolby 2 Channel   Headphone          Dolby 2 Channel and
                                                if supported                         Headphone
<S>              <C>         <C>                <C>               <C>                <C>
[*]              [*]         $[*]              $[*]               $[*]               $[*]

[*]              [*]         $[*]              $[*]               $[*]               $[*]

[*]              [*]         $[*]              $[*]               $[*]               $[*]

[*]              [*]         $[*]              $[*]               $[*]               $[*]
</TABLE>

<PAGE>

   Quantities of Licensed Products are cumulative for the purpose of calculating
royalties and must be calculated on a quarterly basis (based on Dell's fiscal
quarters, as set forth in the Original License Agreement).

   Dell will be responsible for all replication costs and cost of materials.

2. The following Section 12.0 is hereby added to the Original License Agreement:
   -----------------------------------------------------------------------------

12.0 Right to Make a Bid

Dell shall use commercially reasonable efforts to inform Licensor, in writing,
if at any time it is undertaking or planning to undertake product development or
modifications related to video or audio playback, or that otherwise might
incorporate or use any technology, product, or software created by Licensor
("Potential Project"). With respect to the information that Dell provides
  -----------------
regarding a Potential Project, Dell will use commercially reasonable efforts to
include sufficient detail to enable Licensor to determine whether its
technology, products or software are appropriate for the Potential Project.
Licensor may bid on Potential Projects. While Dell is not obligated to accept
any bid by Licensor, Dell agrees to consider Licensor's proposal in a good
faith.

3. Except as otherwise specified, all terms used in this Second Amendment have
the same meaning as such terms have in the Original Agreement. Except as
specifically set forth in this Second Amendment, the relationship between the
parties with respect to the subject matter of the Original Agreement continues
to be governed by the terms of the Original Agreement, the provisions of which
remain in full force and effect. In the event of a conflict between the terms of
the Original Agreement and the terms of this Second Amendment, the terms of this
Second Amendment control.

IN WITNESS WHEREOF, the Parties hereto have duly executed this Second Amendment
to the Software Licensing Agreement by their respective duly authorized
officers.

DELL PRODUCTS, L.P.                                  INTERVIDEO, INC.

By: /s/ Scott Crawley                                By: /s/ Steve Ro
    ---------------------                                -----------------------

Title:  Director                                     Title:  CEO
       ------------------                                   --------------------

Date:   April 29, 2002                               Date:   April 29, 2002
      -------------------                                  ---------------------
                                       -2-

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