Sample Business Contracts

License Agreement - Carnegie Mellon University and Sonic Foundry Systems Group Inc.


                  Carnegie Mellon University - Mediasite, Inc.

This Amended and Restated License Agreement (hereinafter "this Agreement")
entered into effective as of the 15/th/ day of October, 2001 by and between
Carnegie Mellon University, a Pennsylvania not-for-profit corporation, having a
principal place of business at 5000 Forbes Avenue, Pittsburgh, Pennsylvania
("CMU") and Sonic Foundry Systems Group, Inc., a Maryland for-profit
corporation having its place of business at 1617 Sherman Avenue Madison, WI
53704,303, and its corporate parent, Sonic Foundry, Inc., a Maryland corporation
having its place of business at 1617 Sherman Avenue Madison, WI 53704
(hereinafter collectively referred to as "Licensee").


WHEREAS, CMU owns certain rights in certain technology and software relating to
CMU Informedia Project, in the general field of image, sound and text analysis,
segmentation, characterization, search, retrieval, processing, presentation,
display, and other functions, and is interested in licensing same;

WHEREAS, CMU and MediaSite, Inc. (f/k/a islipMedia Network, Inc.) entered into
that certain License Agreement dated October 22, 1997, amended on November 24,
1999 (collectively, the "License Agreement").

WHEREAS, Licensee acquired substantially all of the assets of MediaSite and
assumed certain of its liabilities, including the License Agreement, pursuant to
an asset purchase agreement dated September 6, 2001 and which asset purchase was
effective as of October 15, 2001.

WHEREAS, the parties desire to amend the License Agreement in the manner set
forth in this Agreement and desire to have this Agreement completely supercede
the License Agreement.

NOW THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and intending to be legally bound hereby, the parties agree
as follows:

1. Certain Definitions ("Defined Terms")

1.1. "Code" shall mean computer programming code in both Source Code and Object
Code form.

1.2. "Object Code" shall mean Code, substantially or entirely in binary form,
which is intended to be directly executable by a computer after suitable
processing but without the intervening steps of compilation or assembly.

1.3. "Source Code" shall mean Code, other than Object Code, and related source
code level system documentation, comments and procedural code, such as job
control language, which may be printed out or displayed in human readable form.

1.4. "Copyrights" shall mean any CMU copyrights in licensed Code and other
information licensed under this Agreement.

1.5. The "Informedia Project" shall mean Informedia: Integrated Speech, Image,
and Language Understanding for Creation and Exploration of Digital Video
Libraries conducted under grant No. IRI-9411299 from September, 1994 to
September, 1998 and related, contributing technology from other projects
developed prior to October 1, 1998, which is necessary to implement the
technology developed under grant No. IRI-9411299.



1.6. "Patent(s)" shall mean and include all or any of the following: (i) U.S.
Patent No. 5,664,227 entitled System and Methods for Skimming Digital
Audio/Video Data, and foreign counterparts (ii) U.S. Patent No. 5,835,667
entitled Method and Apparatus for Creating a Searchable Digital Video Library
and a System and Method of Using Such a Library, and foreign counterparts, and
(iii) any additional patent application(s) which may be applied for by and be
issued to CMU related to the Licensed Technology (as defined under Section 1.7
herein), and (iv) any continuation, continuation-in-part, re-examination,
divisional, or reissue of such patents, in the USA or in any other country.

1.7. Licensed Technology (Also see Attachment A)

1.7.1 "Licensed Technology" or "Technology" shall mean the following related to
the CMU Informedia Project: (1) technology developed under the Informedia
Project, pursuant to grant No. IRI-9411299, through and including September 30,
1998, (2) background technology not developed under such grant but which is
needed and used in the Informedia Project, to the extent that CMU has the right
to license same; (3) all claims under the Patents and any modifications,
divisions, extensions, continuations, amendments, or foreign counterparts
thereto; (4) all Code, copyrights, trade secrets, know-how, trademarks and
tradenames owned by CMU, related to the foregoing technology listed in items
(1-3) above, existing as of the Effective Date; and (5) derivatives of the
foregoing technology if designed for use in the Informedia Project and developed
by CMU after the Effective Date and before September 30, 1998 ("the Additional
Period"), and which (a) has been defined in the annually submitted NSF program
plans that extend to the normal end date of the NSF funding, and/or incremental
extensions and renewals that may occur for the base project or (b) constitute
improvements and enhancements which do not introduce new functionality beyond
that found in the technology subject to the foregoing parts 2 and 3 of this
Section 1.7.1.

1.7.2 "Initial Technology" shall mean Licensed Technology "as is" on the
Effective Date.

1.7.3 "Additional Technology" shall mean the Licensed Technology developed after
the Effective Date, CMU has no obligation to Licensee to develop such.

1.8. "Technology Release Date" shall mean the date when a portion of Licensed
Technology is to be released by CMU to Licensee, in accordance with Section 2.3
herein, in a format and manner mutually agreed upon case by case by the parties.

1.9. "Derivative" shall mean the technology developed by Licensee, which
includes, or is based in whole or in part on, the Licensed Technology,
including, but not limited to, translations of the Licensed Technology to other
foreign or computer languages, adaptation of the Licensed Technology to other
hardware platforms, abridgments, condensations, revisions, and software
incorporating all or any part of the Licensed Technology which may also include
Licensee-created modifications, enhancements or other software. Licensee shall
be entitled to establish all proprietary rights for itself in the intellectual
property represented by Derivatives, whether in the nature of trade secrets,
copyrights, patents or other rights, subject to Copyrights; provided, however,
Licensee shall promptly notify CMU of Licensee-originated bug fixes to the
Licensed Technology. Any copyright registration by Licensee for Derivatives
shall give full attribution to CMU's Copyrights.

1.10. "Licensed Product" or "Product" shall mean any product and/or service
which is based on or utilizes wholly or in part Licensed Technology and/or any
and all Derivatives.

1.11. "Year" shall mean a twelve (12) month period ending December 31. "Year 1",
"Year 2", etc. shall mean the first, second, etc. Year following the Effective
Date. Year 1 shall commence January 1, 1998.

1.12. "Fiscal Quarter" or "Quarter" shall mean a normal quarterly accounting
period of Licensee within Licensee's fiscal year.



1.13. "Dispose or Disposition" shall mean the sale, lease or other transfer of
Licensed Products.

1.14. "Revenue" shall mean the U.S. Dollar value of all consideration realized
by Licensee for the Disposition of Licensed Products. In the case of Licensed
Products that include more than the Licensed Technology, the calculation of
Revenue shall subtract (a) the price paid by Licensee for purchased hardware or
software (except software which, in whole or part, is within the definition of
Licensed Technology) that is sold as part of Licensed Products (other than
services) or, in the case of a lease, the proportionate share of said price
based upon the length of the useful life of the purchased hardware compared to
the length of the lease and/or (b) royalty payments to other parties which arise
because of the Disposition of other than the Licensed Technology.

1.15. "Net Sales" shall mean the total Revenues received by Licensee (i) from
the manufacture, use or Disposition of Licensed Products, and (ii) from services
related to Licensed Technology, including but not limited to software,
curriculum, consulting and training services, less the total of all --

      (a) Actual rebates and discounts provided by Licensee in ordinary course
      of business in an arm's length transaction with an unrelated party;
      (b) Sales tariffs, duties and/or taxes imposed on the Licensed Technology;
      (c) Outbound transportation prepaid or allowed; and
      (d) Amounts allowed or credited on returns.

No deduction shall be made for commissions paid to individuals whether they are
individual sales agents or persons regularly employed by Licensee.

1.16. "Royalties" shall mean disposition royalties which are calculated as a
percentage of Net Sales and will be payable by Licensee to CMU under the
provisions of this Agreement.

1.17. "Deferred Royalties" shall mean Royalties for which the cash payment to
CMU is deferred in accordance with Section 4.3 herein.

1.18. "Trigger Date" shall mean the date up to which the cash payment to CMU of
Royalties may be deferred by Licensee; it shall be deemed to be October 12,

1.19. "Effective Date" of this Agreement shall mean October 22, 1997.

1.20. "Dollar", "U.S. Dollar" and "U.S. $" shall mean lawful money of the United
States of America.

1.21. "Prime Rate" shall mean the interest rate per annum announced from time to
time by Mellon Bank, N.A., Pittsburgh, Pennsylvania, as its prime rate.

2. License Grant

2.1. License Grant. CMU hereby grants to Licensee, and Licensee hereby accepts
for the Term of this Agreement the exclusive (exclusive solely as to the parties
listed below as the "Prohibited Licensees"), world-wide right to use the
Licensed Technology to develop, have developed, make, have made, use and Dispose
of Licensed Products and to create Derivatives, within all fields of use and to
sublicense the Licensed Technology to others within the provisions of Section
2.4 herein. CMU shall not license the Patents to any of Adobe, Loudeye, Convera,
Virage and/or Avid or any of their successors in interest which shall include
any company or entity that acquires all or substantially all of the assets, or
all or substantially all of the stock, of any of the foregoing. As consideration
for the inclusion of Adobe as a Prohibited Licensee, Licensee shall



pay to CMU a one-time fee of ten thousand dollars ($10,000) which is payable in
five equal installments beginning in February 2002.

2.2. Technology Release Dates. The Technology Release Date for the Initial
Technology shall be the Effective Date. Additional Technology shall be available
by CMU for Release to Licensee at the end of each month during the Additional
Period, or at other times if mutually agreed upon.

2.3. Sublicensing.

2.3.1. Sublicense Template. CMU will provide Licensee with a template for
consideration by Licensee for any sublicense under Exception 2 of the Sublicense
Grant ("Sublicense Template"); this Template will incorporate the general terms
and conditions which will be mandatory for all such sublicenses (other than
under Exception 1, Section 2.3.2.). Any sublicense must meet the material
requirements of the Sublicense Template.

2.3.2. Sublicense Grant. No right to sublicense the Licensed Technology is
hereby granted to Licensee except -

Exception 1: Licensee may sublicense Licensed Technology to its direct customers
as required to enable such customers to use and practice Licensed Technology.

Exception 2: Licensee may sublicense Licensed Technology to another party or
parties which were specifically pre-approved by CMU, in writing. Licensee shall
make sublicense royalty payments to CMU, based upon such sublicense, equal to or
greater than the following percentages of the revenue (all consideration)
realized by sub-licensee from the Disposition of Licensed Product (provided that
payments by sub-licensee to Licensee shall not be included in Net Sales):

Years following Effective Date     0-5     6-10     11 and thereafter
                                   ---     ----     ------------------

                                   10%      8%              6%

Exception 3: For different terms and conditions than specified in Exceptions 1
or 2, Licensee may sublicense Licensed Technology only with the specific written
agreement by CMU with regard to all provisions of such a proposed sublicense.

2.3.3. Possibility of Additional Specific Sublicense Templates in the Future. It
is recognized that, over a period of time, certain sublicensing patterns may
evolve which are in the common interest and acceptable to CMU and which could
result in CMU's pre-approval of Specific Sublicense Templates for specific
markets and other specific circumstances.

2.3.4. Sublicensing Agreements, Accounting, and Payment Terms. Licensee will
furnish CMU with current copies of all Sublicense agreements which were executed
under Exceptions 2 and 3. Licensee will maintain separate accounting records for
the sublicense income payable to CMU, and will report such income to CMU as
provided for under Section 8.1 herein. Sublicense royalties payable to CMU shall
be payable by Licensee to CMU quarterly, on the last day of the month
immediately following the Quarter during which any payment of royalties from a
sub licensee was received by Licensee.

2.4. Grant backs. During the term of the Agreement, CMU shall have the right to
use, free of charge, any product or process, solely developed and owned by
Licensee which contains or is based on any of Licensed Technology, patents, or
Licensed Product and/or Derivatives solely, for CMU research, educational,
academic, or administrative purposes. This subsection 2.4 does not include a
right by CMU to sublicense others. None of the restrictions of this subsection
2.4 apply to Bug Fixes reported to CMU under subsection 9.5.



2.6. CMU / Licensee R&D and other Contract Relationships. No provision of this
Agreement shall restrict CMU's or Licensee's ability to conduct further research
and development in the area of Licensed Technology or other areas.

2.7. Regulations. All Licensed Products shall be manufactured, sold and
performed by Licensee in compliance with all applicable governmental laws, rules
and regulations. Licensee shall keep CMU fully informed of, and shall move
expeditiously to resolve, any complaint by a commercial and/or governmental body
relevant to the products or the services, except for complaints subject to
Section 23 of this Agreement.

3. Term of this Agreement

The term of this Agreement shall conclude at the end of twenty (20) years from
the Effective Date of this Agreement, or on the expiration date of the
last-to-expire Patent, whichever comes later, unless otherwise terminated
pursuant to another provision of this Agreement. If Licensee elects to utilize
any know-how or other Licensed Technology, which is not subject to any Patents,
it may do so provided that doing so constitutes an agreement by Licensee to
comply with the Royalties, sublicense royalty payment provisions, and the other
provisions of this Agreement except for (a) the reference to Patents in
Subsection 11.1 and (b) Section 23.

4. Royalties

4.1. General. As partial consideration for the rights and values received under
this License, Licensee shall pay CMU royalties in accordance with the provisions
of this Section 4 herein, in addition to the payments due from Licensee under
the provisions of 2.3.

4.2 Calculation of Royalties. Royalties payable by Licensee to CMU shall be
calculated by Licensee each Quarter as a percentage of Net Sales ("Calculated
Royalties") at the following rates ("Royalty Rates"):

- five percent (5%) for the first five Years beginning on the Effective Date
(Years 1 through 5) or until the end of the Year when cumulative Revenues have
reached $100 million; whichever occurs sooner; then -

- four percent (4%) for the next five Years (Years 6 through 10) or until the
end of the Year when cumulative Revenue have reached $200 million, whichever
occurs sooner; then -

- three percent (3%) thereafter until the earlier of (a) the expiration of
twenty (20) years from the Effective Date of this Agreement and (b) the
expiration date of the last to expire patent; provided, however, that Royalty
Rates shall be subject to the following "Most Favored Pricing" provision :
Should CMU issue a commercial license of the Licensed Technology to any other
party at a lower royalty rate than a Royalty Rate herein specified (without
regard to whether CMU holds any equity interest in Licensee or said other
party), Licensee's Royalty Rate shall be reduced to that lower rate as of the
date and for the length of time when the lower rate of the other license becomes
and remains in effect.

4.3 Deferred Royalties.

4.3.1 Deferred Royalties. Cash Payment of Calculated Royalties may initially be
deferred by Licensee until the Trigger Date. Amortization Schedule. Following the Trigger Date, accumulated Deferred
Royalties shall be payable by Licensee to CMU in accordance with the following
amortization schedule ("Amortization Schedule"):



                           October 12, 2002          50%
                           January 1, 2002           15%
                           May 1, 2002               15%
                           June 30, 2002             20%

The first payment shall not be made in U.S. Dollars, but rather shall be made by
Licensee by providing CMU with a number of shares of Sonic Foundry common stock
equal to the dollar amount that would otherwise be due on said date divided by
$1.185. The balance of the payments under the Amortization Schedule shall be
made in U.S. Dollars.

4.4 Normal Payment Terms for Royalties. Subsequent to the Trigger Date,
Royalties shall be payable quarterly on the sixtieth (60) day immediately
following the Quarter for which such Royalties were Calculated; such payments
shall be made promptly by Licensee, with no invoicing by CMU to be required.

4.5. No Right to Suspend Payments. Notwithstanding the pendency of any
infringement (or other) claim or action by or against Licensee, Licensee shall
have no right to terminate or suspend (or escrow) payment of any amounts
required to be paid to CMU pursuant to this Agreement.

5. Reserved.

6. Minimum Performance Requirements

6.1 Licensee shall use its best efforts to introduce Licensed Technology into
the commercial markets as soon as possible; thereafter, until the expiration of
this Agreement, Licensee shall keep Licensed Technology reasonably available to
the public and actively promoted in commerce.

6.2 Licensee must achieve Net Sales of at least $500,000 in Year 4, $1 million
in Year 5, $1.5 million in Year 6, $2 million in Year 7, $2.5 million per Year
thereafter during the remaining unexpired Term of the License or, alternatively,
make payments of Royalties under Section 4 as though those Net Sales
requirements had been achieved.

6.3 Licensee's failure to perform in accordance with Sections 6.1 or 6.2 herein
shall be grounds for CMU to terminate this Agreement pursuant to Section 12.2

7. General Payment Terms

7.1. Royalties shall be paid by Licensee to CMU as defined in Section 5 herein
until this Agreement expires or is terminated in accordance with this Agreement.
If this Agreement terminates before the end of a Fiscal Quarter, the payment for
that terminal fractional portion of a Fiscal Quarter shall be made within ninety
days of the date of termination of this Agreement.

7.2. All Royalties hereunder shall be paid in U.S. Dollars and shall be made by
wire transfer to CMU's account No. 197-9003 ABA043000261 CMU Ref. No.
1-1-96377-7760 at Mellon Bank's - Oakland office, or by Licensee's check sent in
accordance with Section 24 (Notices).

7.3. All Royalties payable hereunder which are overdue shall bear interest until
paid at a rate equal to the Prime Rate in effect at the date such royalties were
due, but in no event to exceed the maximum rate of interest permitted by
applicable law. This provision for interest shall not be construed as a waiver
of any rights CMU has as a result of Licensee's failure to make timely payment
of any amounts.



8. Reports and Audits

8.1. Reporting Requirements. Licensee shall provide to CMU statements with
respect to royalties and other amounts payable under this Agreement within sixty
(60) days following the end of each of Licensee's Fiscal Quarter ("Reporting
Date"). Each report must be fully and accurately completed and signed and
certified as accurate by Licensee. Each statement shall provide information for
all information items listed below for that Fiscal Quarter and, cumulatively,
for the Year to date, until two years after the Trigger Date when items
hereafter marked with an asterisks (*) are no longer required to be reported if
payment of all Deferred Royalties has been duly completed :

- Net Sales
- Operating Profits *
- Calculated Royalties,
- Royalties payable and due,
- Deferred Royalties *;
- Royalty payment Trigger Date *
- Cumulative total Deferred Royalties since Effective Date *
- Deferred Royalty Amortization amount due *
- Sublicense royalties received and payable to CMU, by specific sublicensees.

8.2. Accurate Books. Licensee shall maintain accurate books and records such
that the Royalties due and payable hereunder can be easily ascertained. Such
books and records shall be maintained at Licensee's primary offices and shall be
available for inspection by CMU or its representatives during the normal
business day upon not less than ten (10) days prior written notice, provided
that CMU or its representatives agree to protect the confidentiality of the
information as to Licensee's customers.

8.3. Audits. CMU shall have the right to have Licensee's books and records
audited by a certified public accounting firm or representative of its
selection, and Licensee agrees to cooperate fully in any such audit, provided
that the auditors agree to protect the confidentiality of all information
obtained as result of the audit. Any such audit shall not be more frequent than
annually. In the event that such audit determines that the amount of Royalties
paid CMU was in error by more than five (5%) percent, Licensee shall pay the
costs of the audit.

9. Improvements and Collaborations

9.1. Discussion Only. The parties intend that there will be no collaboration. If
there is any collaboration in violation of this intent, all resulting property
shall be owned as set forth in this Section 9. Discussion of a problem during
collaboration between the parties to this License Agreement will not create any
rights to any ownership of patents, Patents, copyrights, trade secrets or any
other intellectual property rights.

9.2. Licensee Ownership. Licensee will own all of the right, title and interest
(including patents, copyrights, trade secrets and any other intellectual
property rights) in and to the results of the collaboration between the parties
that are created solely by Licensee employees or agents.

9.3. CMU Ownership. CMU will own all of the right, title and interest (including
patents, Patents, copyrights, trade secrets and any other intellectual property
rights) in and to the results of the collaboration between the parties that are
created solely by CMU employees or agents.

9.4. If a joint development effort related to the Licensed Technology or other
technology is undertaken, the project shall be evidenced by a writing executed
by Licensee and the Associate Provost of CMU and the rights of the parties in
any work product or Intellectual Property Rights arising from such efforts shall
be as



set forth in such writing. In the absence of such writing, CMU shall own all
right, title and interest in and to any work product or Intellectual Property
Rights arising from such joint development efforts.

9.5. Bug Fixes. All reported Licensee-originated bug fixes to the Licensed
Technology shall become the property of CMU and may be incorporated in the Code
and licensed to others; Licensee may utilize such bug fixes pursuant to the
terms of this License Agreement.

9.6. No Separate License. Except as provided in this Section 9, nothing in this
Agreement shall be deemed to grant any license or rights in any other technology
in addition to the Licensed Technology.

10. Patents and Other Intellectual Property

10.1. CMU Property. Intellectual property rights to Licensed Technology such as
Patent(s), Copyrights, and trademark(s) which may be obtainable will remain the
property of CMU, but subject to the license granted in this License Agreement.
Licensee shall be the owner of all proprietary rights for itself in the
intellectual property represented by Derivatives, whether in the nature of
patents, trade secrets, copyrights, or other rights, provided that any and all
uses of Derivatives is subject to the existence, term and other provisions of
this Agreement. Licensee shall be entitled to apply for patents, trademarks, and
copyrights with respect to Derivatives in its own name.

10.2. Patenting Expenses.

CMU will determine the patenting expenses paid for by CMU for each six month
period starting October 12, 2001 until the end of the Term of the Agreement
("Calculation Period"); total Patenting Expenses for such a Calculation Period
will hereafter be referred to as "Expense Increment"; CMU will also determine
the number of licenses for all or essentially all of the Licensed Technology
which were in effect at any time during each Calculation Period ("Number of

Licensee shall reimburse CMU for the dollar amount calculated by (i) dividing
each Expense Increment by (ii) the Number of Licensees for that Calculation
Period; provided, however, that if Licensee should be the sole licensee of all
or most of the Licensed Technology during a Calculation Period, Licensee shall
reimburse CMU for half the Expense Increment. Payment by Licensee to CMU of such
reimbursements shall be due within thirty (30) days after the invoicing of such
amounts by CMU to Licensee.

10.3. International Patent Coverage.

10.3.1. Basic Coverage. CMU intends to prosecute international patent coverage
for some or all of the Patents in certain major industrial countries under the
expense-sharing arrangements provided for in Section 10.2 herein ("Basic
Coverage"). CMU reserves the right to increase or decrease the extent of such
coverage at its own discretion throughout the Term of the License. For
applications for Patents filed after the Effective Date, Licensee must notify
CMU within thirty (30) days after receipt of notice from CMU whether Licensee
agrees to reimburse, CMU for payment for Patenting Expenses. If Licensee does
not so notify CMU of such agreement to reimbursement of CMU, Licensee shall not
have any rights under this Agreement concerning the technology covered by said
application in the country covered by said application.

10.3.2. Additional Coverage. If Licensee should, at any stage of the patenting
process during the Term of the LICENSE, desire to have CMU obtain more than such
Basic Coverage ("Additional Coverage"), CMU will pursue such Additional Coverage
at Licensee's expense to the extent that such protection is reasonably
obtainable. CMU will account for such additional Patenting Expenses (by country)
and will invoice Licensee after the end of each Quarter for such additional
Expenses ("Additional Expenses"); such invoices will be payable by Licensee to
CMU within thirty (30) days. Provided, however, that Licensee may later deduct
fifty percent (50%) of such Additional Expenses from the payment of Royalties to
CMU to the extent that such



Royalties and/or sublicense Royalties which were based on Revenue due to conduct
in a country which was included in such Additional Coverage.

11.  Markings, Trademarks and Trade Names

11.1.  Licensee shall have included in all sales and  marketing literature
relating to Licensed Products a statement to the effect that "this product or
portions thereof is produced under license from Carnegie Mellon University" and
"U.S. Patent Number X,XXX,XXX."

11.2. Licensee shall have marked the appropriate portions of all Licensed
Products with the applicable United States of America and foreign Patent numbers
in accordance with the applicable laws of the countries in which the materials
are intended to be used. Licensee shall neither register nor use any CMU
trademarks or trade names and shall require its sub-licensees not to do so.

11.3. Licensee acknowledges that it does not have any rights or any title
whatsoever in or to CMU's technology, trade name or in or to any of CMU's
trademarks, except as provided under this Agreement. Any reference by Licensee
to CMU beyond the above may only be done with express written permission of
CMU's Director of Technology Transfer.

12.  Termination

12.1. If Licensee shall cease to carry on its business, this Agreement shall
terminate upon written notice by CMU.

12.2. In the event that either party to this Agreement defaults in the
performance of any of its obligations hereunder and fails to cure such default
within thirty (30) days after written notice of such default from the other
party or (in the event that the default is of such nature that it cannot be
cured within said thirty (30) days) the defaulting party is not diligently
pursuing efforts to cure such default, the other party shall have the right by
written notice to the defaulting party within sixty (60) days after the
expiration of such thirty (30) day period to terminate this Agreement.

12.3. The termination of this Agreement pursuant to this Section 12 (or pursuant
to Section 3 of this Agreement) shall not terminate (i) the obligation of
Licensee to promptly pay CMU Royalties which were due or earned by CMU prior to
the effective date of the termination, and other amounts, which are accrued or
which are otherwise to be paid by Licensee under the terms of this Agreement or
(ii) the obligations of Licensee specified under Sections 7, 8, 10, 12, 13, 14,
15, 16, 17, 18, 22, and 23 hereunder.

12.4. Provided that if a sublicense was pre-approved by CMU and contains royalty
payments at least equal to those set forth in Exception 2, in Subsection 2.4.2,
upon termination of this Agreement by CMU Subsections 12.1 or 12.2 hereof, CMU
will accept assignment of such sublicense(s) which is then in effect if the
sub-licensee is not then in default. However, acceptance of such assignment
shall not release Licensee from any responsibility under this Agreement.

13.  Taxes

Licensee shall pay all sales taxes which may be assessed or levied on, or on
account of the Licensed Technology Disposed of hereunder and all taxes (other
than taxes imposed by the United States of America or the Commonwealth of
Pennsylvania or jurisdictions within such Commonwealth) levied on or on account
of the amounts payable to, or for the account of, CMU under this Agreement.



14.  Warranties


15.  Costs

All costs and expenses incurred by Licensee in carrying out its obligations
under this Agreement shall be paid by Licensee, and Licensee shall not be
entitled to reimbursement from royalties hereunder or otherwise therefor from
CMU. Licensee shall possess or obtain at its own expense all necessary licenses
and permits and shall comply with all laws, ordinances, rules or regulations
affecting the importation into and/or resale or transfer of Licensed Product.

16.  Confidentiality and Trade Secrets

16.1. "Confidential Information" shall mean any information relating to the
Licensed Technology, the terms of this Agreement (as from time to time amended),
patent applications, copyright applications, trade secrets and know-how and
other information covered by this Agreement or information disclosed to Licensee
in the matter set forth hereinafter. All such information shall be Confidential
Information to the technology disclosed, including information disclosed to
Licensee prior to the date of this Agreement, unless such information (1) was
already in Licensee's possession prior to the disclosure thereof by CMU as
provided in sub-Section 16.2 hereof, (2) has been published or is published
hereafter, unless such publication is a breach of this Agreement, (3) is
received by Licensee from a third party not under an obligation of
confidentiality with respect thereto, or (4) is independently developed by

16.2. Prior Knowledge. In the event that such information shall be established
to have been known to Licensee prior to the disclosure thereof by CMU by
reference to any publication thereof by Licensee or by reference to any internal
writing or other business record maintained by any of the entities that comprise
Licensee in the ordinary course of business, such information shall not be
deemed to be Confidential Information to that particular entity for purposes of
this Agreement following notification to CMU of such fact.

16.3. Marking as Confidential. With respect to any information not related to
the Licensed Technology which is thought by CMU to be Confidential Information
subject to this Agreement, CMU shall mark such information as "Confidential"
prior to disclosing it to Licensee.



16.4. Notification. With respect to any oral communication not related to the
Licensed Technology which is deemed by CMU to be Confidential Information
subject to this Agreement, CMU shall notify Licensee of such fact and within
thirty (30) days thereafter CMU shall send a memorandum to Licensee outlining
the information deemed to be Confidential Information.

16.5. Term of Confidentiality. Licensee shall maintain in confidence and shall
not disclose to any person not a party hereto, nor shall Licensee use or exploit
in any way without CMU's written agreement, any Confidential Information until
three (3) years after the later of the date of the termination of this Agreement
unless such information ceases to be Confidential Information prior to the end
of such period through no fault of Licensee or CMU and Licensee enter into an
agreement authorizing same.

16.6. Reasonable Precautions. Licensee shall exercise all reasonable precautions
to prevent the disclosure of Confidential Information by its employees or
representatives, and in any event shall maintain with respect to such
Confidential Information a standard of care which is no less than that standard
which Licensee maintains to prevent the disclosure of its own Confidential

16.7. Termination.  Upon termination of this Agreement, Licensee agrees to
return at once to CMU, without copying, all originals and copies of all
materials (other than this Agreement) containing any Confidential Agreement.

16.8  CMU shall keep Confidential technical or financial information and/or
business plans of Licensee, if the document disclosing such to CMU is marked
"Confidential," for a period of three (3) years from the date of said disclosure
unless such information (1) was already in CMU's possession prior to said
disclosure, (2) has been published or is published hereafter, unless said
publication is a breach of this Agreement, (3) is received by CMU from a third
party not under an obligation of confidentiality with respect thereto, (4) is
independently developed by CMU, or (5) ceases to be Confidential prior to the
end of such three year period or Licensee and CMU agree that CMU need no longer
treat such as confidential.

17.   Indemnification

Licensee hereby agrees to defend, indemnify and hold harmless CMU, its trustees,
officers, employees, attorneys and agents from all claims or demands made
against them (and any related losses, expenses or costs) arising out of or
relating to Licensee's and/or its sub-licensees' use of, Disposition of, or
conduct regarding the Licensed Technology and/or Licensed Product, or presence
on the premises of CMU, including but not limited to, any claims of product
liability, personal injury (including, but not limited to, death), damage to
property or violation of any laws or regulations. This indemnification includes,
but is not limited to, indemnification by Licensee and any sub-licensees of acts
of negligence by CMU or CMU's trustees, officers, employees, attorneys, or
agents against employees of Licensee while on CMU's premises.

18.   Insurance

Licensee shall obtain and maintain appropriate coverage of general liability,
product liability, and public liability insurance in the amount of no less than
two million dollars (US $2,000,000).

19.   Breach

No acquiescence in any breach of this Agreement by either party shall operate to
excuse any subsequent or prior breach.



20.   Prior Agreement

Except for any Confidential Disclosure Agreement executed by the parties, this
Agreement supersedes all previous agreements relating to the subject matter
hereof, whether oral or in a writing, and constitutes the entire agreement of
the parties hereto and shall not be amended or altered in any respect except in
a writing executed by the parties.

21.   Interpretation

This Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the Commonwealth of Pennsylvania, United States of America,
without regard to conflict of law principles.

22.   Dispute Resolution

22.1. Arbitration. Any controversy or dispute arising under this Agreement shall
be referred to and finally settled by arbitration in the City of Pittsburgh,
Pennsylvania, under the auspices of, and conducted in accordance with, the rules
of the American Arbitration Association. All arbitration proceedings shall be
before a board of three (3) arbitrators, for each of which each party shall
select one (1) arbitrator and the selected arbitrators shall select the third
arbitrator. The costs of the third arbitrator shall be divided equally between
the parties, and each party shall pay the costs of the arbitrator selected by
it. Any award of the arbitrators shall be final and conclusive on the parties to
this Agreement, and judgment upon such award may be entered in any court having
jurisdiction thereof.

22.2. Injunctive Relief. Either party may seek injunctive relief from a court
for violation by the other party of Sections 11, 13, 14, 15, 16, 17, 18, and 22
herein, for enforcement of any arbitration award or for enforcement of any
non-arbitrable matter. The prevailing party shall be entitled to recover from
the other all costs, including attorney's fees, related to the action for
injunctive relief.

22.3. Court Action.  Licensee hereby irrevocably and unconditionally --

(i) agrees that any action, suit or proceeding contemplated by Sections 22.2 and
22.2 hereof (collectively, "Related Litigation") may be brought in any state or
federal court of competent jurisdiction sitting in Allegheny County,
Pennsylvania, submits to the jurisdiction of such courts, and to the fullest
extent permitted by law agrees that it will not bring any Related Litigation in
any other forum (but nothing herein shall affect the right of CMU to bring any
action, suit or proceeding in any other forum);

(ii) waives any objection which it may have at any time to the laying of venue
of any Related Litigation brought in any such court, waives any claim that any
such Related Litigation has been brought in an inconvenient forum, and waives
any right to object, with respect to any Related Litigation brought in any such
court, that such court does not have jurisdiction over LICENSEE; and

(iii) consents and agrees to service of any summons, complaint or other legal
process in any Related Litigation by registered or certified mail, postage
prepaid, to LICENSEE at the address for notices described in Section 24 hereof,
and consents and agrees that such service shall constitute in every respect
valid and effective service (but nothing herein shall affect the validity or
effectiveness of process served in any other manner permitted by law).

23.   Infringement

23.1. Licensee shall have the right during the term of this Agreement to
commence an action for infringement of the Patents, Copyrights, and/or
Confidential Information against any third party for any infringement, only if
(a) Licensee has provided CMU ninety (90) days' prior written notice of such
infringement and of Licensee's desire to file such action and (b) CMU has not



initiated an action against the alleged infringer before the expiration of said
ninety (90) day period after receipt of Licensee's notice. CMU shall have the
right at its own expense to appear in such action by counsel of its own
selection. If required by the jurisdictional laws of the forum that any such
action be prosecuted in the name of the owner of the Patent, Copyright, and/or
Confidential Information, CMU shall voluntarily appear at Licensee's expense;
provided that if such appearance subjects CMU to any unrelated action or claim
of a third party or Licensee in such jurisdiction, then CMU shall have the right
to decline such appearance. Any settlement shall require the consent of CMU and,
absent agreement between CMU and Licensee to the contrary, any settlement amount
or recovery for damages shall be applied as follows: (i) first, to reimburse the
parties for their expenses in connection with the litigation; and (ii) second,
CMU shall receive four percent (4%) of any monies remaining.

23.2. CMU shall have the right in its absolute discretion during the term of
this Agreement to commence an action for infringement of the Patents,
Copyrights, and/or Confidential Information against any third party for any
infringement occurring anywhere in the world.

24. Notices

Any notice under any of the provisions of this Agreement shall be deemed given
when deposited in the mail, postage prepaid, certified first class mail return
receipt requested and addressed to the applicable party at the address stated on
the signature page hereof, or such other address as such party shall specify for
itself by like notice to other party. Each party shall transmit to the other a
facsimile copy of each such notice promptly after such deposit in the mail.

25. Assignment

Licensee shall neither assign nor transfer this Agreement or any interest herein
without the prior written consent of CMU. If Licensee wishes to dispose of the
business of which this Agreement forms part or if all or substantially all of
the assets of Licensee shall be acquired by another corporation, such consent by
CMU to assignment to such acquiring corporation shall not be unreasonably
withheld or delayed.

26. Headings

The Section headings contained in this Agreement are set forth for the
convenience of the parties only, do not form a part of this Agreement and are
not tobe considered a part hereof for the purpose of construction or
interpretation hereof, or otherwise.

Balance of page intentionally left blank.



IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed in duplicate counterparts, each of which shall be deemed to constitute
an original, effective as of the date first above written.

The undersigned  verify subject to the penalties of 18 Pa. C.S.(S) 4904 relating
to unsworn  falsification to authorities that they have the authority to bind to
this Agreement the party on behalf of which they are executing below.

Carnegie Mellon University                    Sonic Foundry Systems Group, Inc.

By:    /s/                                         /s/
      -----------------------------           ---------------------------------
      Susan Burkett
      Associate Provost                       Chief Executive Officer

Date:  1/16/02                                Date: 1/15/02
      -----------------------------           ---------------------------------



                                  Attachment A

                       Description of Licensed Technology

"Licensed Technology" is defined in Section 1.7 of this Agreement, and includes
both Initial Technology and Additional Technology.

A.  "Initial  Technology" is defined in Section 1.7.21 of this Agreement; it
includes but is not  necessarily  limited to the following as of the Effective
Date of the Agreement:

1. Informedia/1/ processing and tools for content creation, indexing and
abstraction, both automated and manually assisted. This shall be deemed to
include, but not be limited, to the following:

-  Segmentor
-  Database cataloging
-  Automated database testing
-  Sphinx-II, Sphinx-III and the CMPSL (CMU Portable Speech library)
-  Speaker differentiation/identification
-  Image understanding analysis library components used for:

     * scene analysis, scene segmentation, frame histogramming,
     * poster-frame selection, image matching, region and object extraction,
     * text and face detection and matching (neural-net based algorithms),
     * video text OCR, video skim creation and image characterization.

-  Natural language and statistical processing algorithms and code as
   applied to video segmentation, titling, abstracts, latent semantic
   indexing, and topic detection and categorization.

-  Integrated  processing and statistical correlation of face/name/place/event
   as applied to "Name-It" and "Spot-it" functionality

-  Automated processing algorithms, code, scripts and procedures

  2. Informedia data structures, data organization and data distribution server
architecture specification and code, including flat file and RDBMS

  3. Informedia client and display, Windows and HTML/Java versions for full
video and "slide show" presentation.

  4. Search and retrieval specification and code, including the Pursuit engine;
derivatives developed in Informedia, subject to limiting prevenient agreements.

  5. Informedia Netbill interface specification and code related to video data
delivery, subject to limiting prevenient agreements.

B.  "Additional Technology" is defined in Section 1.7.32 of this Agreement.

Note: 1. Most of the expected Additional Technology relates to improvement of
the quality of performance (e.g., precision, accuracy, speed) or enhancement and
perfection of the techniques presently applied in many areas; primarily, those
areas where the initial implementation or methods are in error, incomplete, or
inadequate. The Informedia Project does not anticipate entirely new research
problems providing new functionality to be pursued during the Additional Period.



2. Additional Technology shall not include new functionality and/or inventions
which are not part of the Informedia program plans specified under Section
1.7.13(I) and/or which are not in domains thus specified; examples of such new
functionality are, such as multilingual Informedia or summarization across
multiple stories.

/1/ "Informedia or Informedia Project" means: Integrated Speech, Image, and
Language Understanding for Creation and Exploration of Digital Video Libraries,
conducted under Grant No. IRI-9411299 from September 1994 to September 1998 and
related, contributing technology from other projects developed prior to October
1, 1998, which is necessary to implement the technology developed under Grant
No. IRI-9411299 and underway.