None.

Certain information required by Part III is omitted from this Report on Form 10-K in that the Registrant will file its definitive Proxy Statement for its Annual Meeting of Stockholders (the 2002 Proxy Statement) pursuant to Regulation 14A of the Securities Exchange Act of 1934, as amended, not later than 120 days after the end of the fiscal year covered by this Report, and certain information included in the 2002 Proxy Statement is incorporated herein by reference.

The information required by this is included in the 2002 Proxy Statement under the captions "Election of Directors -- Nominees," "Additional Information -- Executive Officers" and "Additional Information -- Section 16(a) Beneficial Ownership Reporting Compliance" and is incorporated herein by reference.

The information required by this Item is included in the 2002 Proxy Statement under the captions "Election of Directors -- Compensation of Directors," "Additional Information -- Executive Compensation" and is incorporated herein by reference.

The information required by this Item is set forth in the 2002 Proxy Statement under the captions "Additional Information -- Security Ownership" and "Additional Information -- Equity Compensation Plan Information" and are incorporated herein by reference.

In the quarter ended March 31, 2000, the Company entered into a strategic relationship with STMicroelectronics NV, or STM. Under various agreements, STM purchased shares of 8x8 common stock and was granted certain related rights, licensed certain of the Company's intellectual property and engaged the Company to jointly develop products that enable voice and other multimedia services over internet protocol networks. In addition, STM and 8x8 entered into a cross license agreement in March 2002 that is more fully described below.

Stock Purchase and Related Rights. As part of the arrangement, STM purchased 3.7 million shares of 8x8's common stock for $27.75 million. STM's share ownership currently represents 13.1% of our outstanding common stock making them the Company's largest shareholder. STM has been granted certain registration rights that expire upon the earlier of the date that STM can sell the remaining shares it holds in any three-month period under Rule 144, or February 2007. The registration rights allow STM to:

• require us to file a registration statement with the U.S. Securities and Exchange Commission covering the resale of some or all of the 3.7 million shares still held by STM, subject to certain conditions; and
• participate in future registration statements, including a registered public offering involving an underwriting, subject to certain conditions and limitations.

In addition, STM has preemptive rights that allow STM to purchase additional shares of common stock from the Company or receive rights to acquire shares of 8x8 common stock, in proportion to their ownership percentage, to the extent that shares of 8x8 common stock or rights to acquire 8x8 common stock are issued in connection with financing activities. STM's preemptive rights terminate on the later of the date that it owns less than 10% of 8x8's outstanding common stock or February 2003. Further, so long as STM holds at least 10% of 8x8's outstanding common stock, the Company is obligated to nominate one qualified nominee selected by STM for election to 8x8's board of directors. Christos Lagomichos, vice president and general manager of the Set-Top Box Division of STM's subsidiary, STMicroelectronics, Inc., was selected as a nominee by STM and currently serves on 8x8's board of directors.

License and Development Agreements. Under a non-exclusive, royalty-bearing license agreement entered into in the quarter ended March 31, 2000 in conjunction with the stock purchase and rights agreements discussed above, the Company provided a subsidiary of STM, STMicroelectronics, Inc., or STM Inc., with rights to use certain of its voice-over-internet-protocol semiconductor and embedded software technology. STM Inc. is required to pay royalties based on a percentage of the net sales price of products sold by STM Inc. that incorporate the licensed technology.

Under a separate development agreement that was also executed in the quarter ended March 31, 2000, 8x8 and STM Inc. established a framework for the joint development of semiconductor products and defined two initial projects. One project provides for the joint development of a voice-enabled chipset for cable modems and cable television set-top boxes. STM Inc. is not required to pay the Company any engineering fees associated with the development efforts necessary to support this project, which is still ongoing. STM Inc. is required to pay certain per-unit royalties based upon shipments of products that may eventually result from this development effort. The other project involves the integration of certain of our voice-over-internet protocol technology into products intended to be used in various internet telephony applications including digital subscriber line, or DSL, modems and internet protocol telephones. In May 2000 STM Inc. paid us $1.0 million associated with this project; $500,000 for engineering fees associated with the development effort and $500,000 of prepaid royalties. We have substantially completed our obligations under this project and STM Inc. is currently marketing and selling a product resulting from this joint development effort. STM Inc. is required to pay us additional per-unit royalties based upon shipments of this product only if cumulative royalties owed eventually exceed the balance of prepaid royalties. Should STM Inc. elect to have us provide extended product maintenance and support, they are required to pay us additional fees of which a portion will be considered prepaid royalties.

In March 2002, 8x8 licensed certain STM Very Long Instruction Word, or VLIW, microprocessor cores, related tools and MPEG4 video compression firmware from STM for use in the Company's Internet protocol, or IP, video communication processor development initiatives. Additionally, 8x8 agreed to license STM certain of its existing and future H.263 and H.26L video compression/decompression firmware implementations for use with STM's semiconductor products. The licenses are non-exclusive, non-transferable and non-assignable and provide for the sharing of updates and enhancements to the licensed technology, subject to certain limitations. The agreement includes provisions that allow the Company to manufacturing semiconductor devices that contain the ST200 core at STM or at other third-party fabrication facilities. The Company is required to pay STM per-unit royalties based upon shipments of products that incorporate the VLIW technology. In addition, STM is required to pay the Company certain per-unit royalties based upon shipments of STM semiconductor products that contain the Company's video technology.

Additional information required by this Item is set forth in the 2002 Proxy Statement under the captions "Additional Information -- Employment Contracts and Termination of Employment and Change in Control Arrangements," "Additional Information -- Compensation Committee Interlocks and Insider Participation," "Additional Information -- Report of the Compensation Committee of the Board of Directors" and "Additional Information -- Stock Performance Graph" and is incorporated herein by reference.

(a)(1) Financial Statements. The information required by this item is included in Item 8.

(a)(2) Financial Statement Schedules. The information required by this item is included in Item 8.

(a)(3) Exhibits. The documents listed on the Exhibit Index appearing at pages 69-71 of this Report are filed herewith. Copies of the exhibits listed in the Exhibit Index will be furnished, upon request, to holders or beneficial owners of the Company's common stock.

(b) Reports on Form 8-K. On January 30, 2002, we filed an amendment to our Current Report on Form 8-K dated December 17, 2001 reporting the redemption of our convertible subordinated debentures.

On February 14, 2002, we filed a Current Report on Form 8-K also dated February 14, 2002 announcing that Bryan Martin had been named Chief Executive Officer of 8x8, Inc. and that Joe Parkinson, our former Chief Executive Officer, would continue as Chairman of 8x8's Board of Directors. We also announced a new Internet Protocol (IP) video product development initiative.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant, 8X8, Inc., a Delaware corporation, has duly caused this Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Santa Clara, State of California, on May 23, 2002.

8X8, INC.

EXHIBIT INDEX

Exhibit 10.21

STMICROELECTRONICS N.V. AND 8X8 LX VIDEO DEVELOPMENT AND LICENSE

1. ST LX Technology. Subject to the terms and conditions herein, ST is to provide 8x8 with sufficient information to enable 8x8 to develop semiconductor products that incorporate the ST LX based processor core technology.. For purposes of this Agreement, "LX Technology" shall mean the LX based processor core technology known as ST 210 and ST 220 and a specific ST220 enhanced core (hereafter known as ST220-26L) which will be for the purpose of accommodating the performance requirements of the H26L specification. For purposes of this Agreement, the "8x8 LX Chips" shall mean chips designed by 8X8 and incorporating the LX Technology, 8x8 circuitry and possibly other ST or third party circuitry. The information to be provided by ST hereunder ("LX Information") includes, but is not limited to, the following as it relates to the LX Technology and as it exists on the Effective Date or upon delivery:
   
1. All applicable netlists; schematics; layouts; software, high level, behavioral, C-, Verilog and timing models; simulation patterns, validation and test suites and test programs; and standard cell libraries and models.
2. All internal ROM microcodes and microcode models and tools
3. Documentation relating to these items to the extent presently available and in its existing form.
   
2. ST LX Tools. ST will provide 8X8 the ST220 simulator and compiler (known as the Multi-Flow tools chain) and successor simulators and compilers related to the LX Technology (the "LX Tools") in binary code format. ST will provide 8x8 with five (5) ST210 development platforms and five (5) ST220/Web-Buddy development platforms. ST will provide 8x8 with documentation relating to these items to the extent presently available and in its existing form.
   
3. ST LX License. Subject to the terms and conditions of this Agreement, ST hereby grants to 8x8, a non-exclusive, non-transferable, non- assignable, world-wide license to use, operate and copy the LX Technology, LX Information and LX Tools in order to make, have manufactured, commercialize, sell and otherwise dispose of 8x8 LX Chips and 8x8 software. The license granted herein includes any patents, trade secrets, copyrights or other intellectual property owned by ST or its Affiliates now or in the future applicable to the LX Technology, LX Information and LX Tools provided that any license or delivery of technology is only to the extent ST is legally entitled to grant rights thereto to 8x8 hereunder.
   
1. 8x8 shall have the rights to choose, at its sole discretion, at which foundry to manufacture the 8x8 LX Chips, provided that ST shall first be offered an opportunity to meet or beat all terms and conditions offered by 8x8's chosen foundry vendor including but not limited to such terms as unit pricing, tooling, capacity allocation, prototype and production delivery, quality and reliability.
   
1. 8x8 shall present to ST a request for quotation ("RFQ") that contains sufficient information with which ST can provide a quotation to 8x8 including any relevant competitive terms and conditions, without violating any existing Non Disclosure Agreements in affect between 8x8 and a 3^rd party. ST will provide 8x8 with a quotation within a reasonable timeframe as mutually agreed to between the parties. If such ST quotation does not meet competitive terms and conditions or is not received by 8x8 in a timely manner, 8x8 can choose, at its sole discretion, to build the 8x8 LX Chips at alternative, non-ST foundry of its choice.
   
2. If ST does respond to the RFQ in a timely manner and with competitive terms, 8x8 may at its own discretion, still choose to manufacture the 8x8 LX Chip at another foundry. However, 8x8 will ensure that at least 80% of the annual unit volume that it purchases of such an 8x8 LX Chip is manufactured or sourced through ST provided that ST maintains competitive terms and conditions.
   
3. 8x8 acknowledges that ST may subcontract some or all of the manufacturing of the 8x8 LX Chips to an external, third party foundry. Accordingly, design package information provided by 8x8 to ST for the manufacture of the 8x8 LX Chips may be, at 8x8's sole discretion, targeted towards the appropriate third party foundry process.
   
2. Subject to the terms and conditions of this Agreement and in addition to the rights granted in Section 3 above, ST hereby grants to 8x8 the right to grant to 8x8's 8x8 LX Chip customers a non-exclusive, non-assignable, non-transferable sublicense to use the 8x8 LX Chips to develop, make, have manufactured, commercialize, sell or otherwise dispose of board, subsystem or system level products that contain the 8x8 LX Chip.
   
4. LX Royalty. In return for the license described in Item 3, 8x8 will pay ST a royalty of $0.25 for each of the first five (5) million, $0.15 for each of the units between five (5) and ten (10) million, and $0.10 for each unit above ten (10) million 8x8 LX Chips not manufactured by ST or sourced through ST that 8x8 sells either as a semiconductor product or incorporated in a system.
   
5. ST MPEG4 Code. Subject to the terms and conditions herein, ST is to provide 8x8 with its existing DIV-X MPEG4 firmware ported for execution on the LX in source and object code form ("MPEG4 Code") as it exists upon delivery and any documentation relating to the MPEG4 Code to the extent presently available and in its existing form. Specifically excluded from the license granted hereunder are any future developments, enhancements, maintenance or any other technology developed relative to MPEG1, 2,4 or MPEG standards that are unrelated to the MPEG4 Code as of the Effective Date.
   
6. ST MPEG4 License. Subject to the terms and conditions of this Agreement, ST hereby grants to 8x8 a royalty free, nonexclusive, nontransferable, non-assignable world-wide license to use, operate, copy and modify the MPEG4 Code in order to make, have manufactured, commercialize, sell and otherwise dispose of 8x8 LX Chips bundled with the MPEG4 Code or derivatives thereof provided by ST hereunder or developed by 8x8 hereunder, provided that nothing herein entitles 8x8 to distribute the MPEG4 Code except in object code form only. The license granted herein includes any patents, trade secrets, copyrights or other intellectual property owned by ST now or in the future applicable to the MPEG4 Code, provided that any license or delivery of technology is only to the extent ST is legally entitled to grant rights thereto to 8x8 hereunder.
   
1. Subject to the terms and conditions of this Agreement and in addition to the rights granted in Section 6 above, ST hereby grants to 8x8 the right to grant to 8x8's 8x8 LX Chip customers a non-exclusive, non-assignable, non-transferable sublicense to use the MPEG4 Code to develop, make, have manufactured, commercialize, sell or otherwise dispose of products that contain the MPEG4 Code as bundled with the 8x8 LX Chips and in object code form only.
   
7. 8x8 Code. Subject to the terms and conditions herein, 8x8 is to provide ST with its H.263 and future H26L video codec firmware ported for execution on the LX Technology (including, if any, H.263 or H.26L codec firmware targeted for operation on a system host processor in conjunction with the LX Technology) in source and object code form ("8x8 Code") as it exists upon delivery and any documentation relating to the 8x8 Code to the extent presently available and in its existing form. The parties understand and agree that the H26L video codec firmware as referred to hereunder means the Joint Model Number 1 video compression recommendation resulting from the work of the Joint Video Team formed by ITU-T SG16 Q.6 (VCEG) and ISO/IEC JTC 1/SC 29/WG 11 (MPEG).
8. 8x8 License. Subject to the terms and conditions of this Agreement, 8x8 hereby grants to ST a nonexclusive, nontransferable, non- assignable world-wide license to use, operate, copy and modify the 8x8 Code in order to make, have manufactured, commercialize, sell and otherwise dispose of ST semiconductor products bundled with the 8x8 Code or derivatives thereof ("ST Chip"), provided that nothing herein entitles ST to distribute the 8x8 Code except in object code form only. The license granted herein includes any patents, trade secrets, copyrights or other intellectual property owned by 8x8 now or in the future applicable to the 8x8 Code, provided that any license or delivery of technology is only to the extent 8x8 is legally entitled to grant rights thereto to ST hereunder.
   
1. Subject to the terms and conditions of this Agreement and in addition to the rights granted in Section 8 above, 8x8 hereby grants to ST the right to grant to ST's ST Chip customers a non-exclusive, non-assignable, non- transferable sublicense to use the 8x8 Code to develop, make, have manufactured, commercialize, sell or otherwise dispose of products that contain the 8x8 Code as bundled with the ST Chips and in object code form only.
   
9. Third Party Technology. Specifically excluded from the licenses granted hereunder are any developments, enhancements, maintenance or any other technology received by the licensor from third parties unless such third party has allowed the licensor to pass on such enhancements to the licensor's other licensees.
   
10. Custom Development. Specifically excluded from the licenses granted hereunder are any developments, enhancements, maintenance or any other technology developed by the licensor for a third party unless such third party has allowed the licensor to pass on such enhancements to licensor's other licensees.
    
11. 8x8 Code Royalty. In return for the license described in Item 8, ST will pay 8x8 a royalty according to the below schedule for each ST Chip it sells with which the 8x8 Code is expressly sublicensed or supplied by ST to ST customers.
    

Volume	Royalty Per Unit
Initial 4,500,000 ST Chips bundled with the H.263 based 8x8 Code	$0.10
Initial 4,500,000 ST Chips bundled with the H.26L based 8x8 Code	$0.10

12. Subject to the terms of this Agreement, in the event the 8x8 Code or any derivatives of the MPEG4 code practices patents, patent applications, including with respect to patents any patent rights granted upon any reissue, division, continuation or continuation-in-part applications now or hereafter filed ("Patents") by ST, ST agrees that it will not assert these Patents against 8x8 for 8x8's making, using, and/or selling of the 8x8 Code. In any event this non-assert clause applies only in favor of 8x8 and 8x8 customers, and does not cover any third parties or partners of 8x8. NOTWITHSTANDING ANYTHING TO THE CONTRARY, This non-assert clause is non- transferable, not assignable and will automatically terminate in the event of a change of control of 8X8. For purposes of this section, a change of control shall mean one transaction or a series of related transactions that results in a change of control through direct or indirect ownership of fifty percent (50%) or more of the outstanding shares of stock entitled to vote for the election of directors (other than restricted shares of stock).
    
13. Subject to the terms of this Agreement, in the event the LX Technology, the MPEG4 Code, or any derivatives of the 8x8 Code practices patents, patent applications, including with respect to patents any patent rights granted upon any reissue, division, continuation or continuation-in-part applications now or hereafter filed ("Patents") by 8x8, 8x8 agrees that it will not assert these Patents against ST for ST's making, using, or selling the LX Technology, the MPEG4 Code, or any derivatives of the 8x8 Code. In any event this non-assert clause applies only in favor of ST and ST customers and does not cover any third parties or partners of ST. NOTWITHSTANDING ANYTHING TO THE CONTRARY, This non-assert clause is NON-Transferable, not assignable and will automatically terminate in the event of a change of control of ST. For purposes of this section, a change of control shall mean one transaction or a series of related transactions that results in a change of control through direct or indirect ownership of fifty percent (50%) or more of the outstanding shares of stock entitled to vote for the election of directors (other than restricted shares of stock).
    
14. All royalties payable hereunder will be due within 30 days of the end of each of the payee's fiscal quarters in which applicable product was shipped. Each party is entitled to audit the other party's records through an independent auditor. Either party shall have the right for representatives of a firm of independent accountants who shall have signed an appropriate non disclosure agreement, to which the other party shall not unreasonably object ("Auditors"), to make an examination and audit, by prior appointment agreed between the Parties, such agreement not to be unreasonably withheld, during normal business hours, not more frequently than once annually during the time that a party is required to make royalty payments to the other party hereunder and for one year thereafter, of all records and accounts as may under recognized accounting practices contain information bearing upon the royalties revenue and the number of products sold by either party under this Agreement. The Auditors will report to the auditing party only upon whether the royalties paid to it by the audited party were or were not correct, and if incorrect, what are the correct amounts for the royalties. The audited party shall be supplied with a copy of or sufficient extracts from any report prepared by the Auditors. Such audit shall be at the auditing party's expense unless it reveals an underpayment of royalties of five percent (5%) or more in which case the audited party shall reimburse the auditing party  for the costs of such audit, plus interest of 12% per annum on the deficiency from the time the royalty was due until paid.
    
1. Concurrent with each royalty payment either party makes hereunder, the paying party shall provide an explanation, as mutually agreed to, of how the payment amount was calculated.
   
15. Development Schedule. ST will employ commercially reasonable efforts to deliver the LX Tools, the LX Technology and the MPEG4 Code (together "ST Technology") within one (1) month of the Effective Date. 8x8 will employ commercially reasonable efforts to deliver the initial 8x8 Code within nine (9) months from receipt of the LX Tools and the LX Technology.
    
16. Tool Updates. ST will provide 8x8 with updates and enhancements to the LX Tools developed by ST, including but not limited to the new tool chain that ST is developing that is expected to be available at the end of 2002 and any documentation as they become available for the term of this Agreement. Upon delivery, such updates and enhancements shall become part of the LX Tools as defined herein.
17. Update and Enhancement Sharing. ST and 8x8 will share with each other where the creating party has the legal ability to disclose, such updates and enhancements either party makes to the LX Technology, MPEG4 Code and 8x8 Code ("Enhancements") as those terms are defined herein as they become available for a period of two (2) years from the Effective Date or two (2) years from the date on which a new, major version of the relevant technology is made available whichever is later. For purposes of this agreement, the meaning of a new, major version shall be mutually agreed to but would be considered , but not limited to , for the LX Technology the initial delivery and any new version of the LX core provided hereunder and for the 8X8 Code the H263 codec or new H26L codec. After that time, Enhancement sharing is to continue unless either party indicates an interest in discontinuing to share such Enhancements at which time the parties will exchange the latest updates and no further Enhancements will be shared. Upon delivery such Enhancements will become part of the relevant LX Technology, MPEG4 Code or 8x8 Code as those terms are defined herein.
    
18. Future Developments. The parties understand that availability of the H26L based 8x8 Code assumes implementation of a mutually agreed to version of the LX Technology capable of executing the H.26L based 8x8 Code and ratification and acceptance of the relevant standard currently known as the Joint Video Team (JVT) initiative. ST and 8X8 agree to negotiate in good faith on a case-by-case basis the terms and conditions under which such a license may be provided for future cores and future codecs.
    
19. Technical Support. Each party will provide the other with sufficient applications engineering level technical support necessary to commercialize products based on the licensed technology for as long as the parties continue to share enhancements to the licensed technology.
20. 8x8 LX Chip Customers. In the event that an 8x8 LX Chip customer wishes to license the LX Tools or the MPEG4 Code in source format, ST agrees to negotiate in good faith on a case-by-case basis the terms and conditions under which such a license may be provided.
21. ST LX Customers. In the event that an ST Chip customer wishes to license the 8x8 Code in source code form, 8x8 agrees to negotiate in good faith on a case by case basis the terms and conditions under which such a license may be provided.
22. Representations and Warranties
1. 8x8 represents and warrants to ST that (a) to the best of its knowledge as of the Effective Date it has full power and authority to enter into this Agreement, (b) to the best of its knowledge as of the Effective Date the terms and conditions of this Agreement, and 8x8's obligations hereunder, do not conflict with or violate any terms or conditions of any other agreement or commitment to which 8x8 is a signatory or by which it is bound, (c) to the best of its knowledge as of the Effective Date it owned or controlled the 8x8 Code that will be licensed and delivered to ST under this Agreement and (d) it will defend and indemnify ST against any third party claims arising out of or related to a breach of these warranties and representations.
   
2. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, 8x8 MAKES NO WARRANTIES OR CONDITIONS, EXPRESSED, STATUTORY, IMPLIED, OR OTHERWISE, WITH RESPECT TO THE 8x8 CODE LICENSED HEREUNDER, AND 8x8 HEREBY DISCLAIMS THE IMPLIED WARRANTIES AND CONDITIONS OF, SATISFACTORY QUALITY, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT THERETO.
   
3. ST represents and warrants to 8x8 that (a) to the best of its knowledge as of the Effective Date it has full power and authority to enter into this Agreement, (b) to the best of its knowledge as of the Effective Date the terms and conditions of this Agreement, and ST's obligations hereunder, do not conflict with or violate any terms or conditions of any other agreement or commitment to which ST is a signatory or by which it is bound, (c) to the best of its knowledge as of the Effective Date it owned or has authority to license the ST Technology that will be licensed and delivered to 8x8 under this Agreement and (d) it will defend and indemnify 8x8 against any third party claims arising out of or related to a breach of these warranties and representations.
   
4. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, ST MAKES NO WARRANTIES OR CONDITIONS, EXPRESSED, STATUTORY, IMPLIED, OR OTHERWISE, WITH RESPECT TO THE ST CODE LICENSED HEREUNDER, AND ST HEREBY DISCLAIMS THE IMPLIED WARRANTIES AND CONDITIONS OF, SATISFACTORY QUALITY, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT THERETO
   
23. 8x8 Indemnification
    
1. 8x8 shall indemnify and hold ST, their respective officers, directors, employees and agents (hereafter referred individually or collectively as "ST Indemnitees") harmless and shall pay all costs, damages, and reasonable attorneys' fees and expenses relating to ST Indemnitees defense resulting from any suit, claim, demand, or other action by a third party against ST Indemnitees based upon a finding that any 8x8 Code infringes the IP Rights of a third party ("ST Infringement Claim"), provided that: (i) ST gives written notice to 8x8 within ten (10) business days of notice of such ST Infringement Claim; (ii) ST allows 8x8 at its expense through attorneys of its own choice, to exclusively defend or control the defense of any ST Infringement Claim; and (iii) ST assists 8x8 in all reasonable aspects in such investigation and defense, and is reimbursed by 8x8 for all the reasonable costs incurred in collaborating in such investigation and defense. The foregoing indemnity obligations shall specifically not apply to any claim excluded under Section (b) below. If, as a result of a ST Infringement Claim, ST Indemnitees are enjoined from using the 8x8 Code, or selling ST Chips, 8x8 may in its sole discretion, (i) procure for ST Indemnitees the right to use the 8x8 Code under the same terms and conditions set forth in this Section or (ii) provide ST Indemnitees with modified 8x8 Code that is non-infringing while still meeting substantially the same functional specifications as the 8x8 Code.
   
2. 8x8 shall have no obligation hereunder for any ST Infringement Claim which results from: (a) the combination of the 8x8 Code with other products; (b) the modification of the 8x8 Code by parties other than 8x8 (or not authorized by 8x8); (c) the Enhancements of the 8x8 Code by or for ST.
   
3. THIS SECTION STATES THE ENTIRE LIABILITY OF 8x8 AND THE EXCLUSIVE REMEDY OF ST WITH RESPECT TO ANY AND ALL INFRINGEMENT CLAIMS. EXCEPT AS EXPRESSLY STATED IN THIS SECTION, ALL WARRANTIES OF NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS ARE HEREBY DISCLAIMED BY 8x8.
   
24. ST Indemnification
    
1. ST shall indemnify and hold 8x8, their respective officers, directors, employees and agents (hereafter referred individually or collectively as "8x8 Indemnitees") harmless and shall pay all costs, damages, and reasonable attorneys' fees and expenses relating to 8x8 Indemnitees defense resulting from any suit, claim, demand, or other action by a third party against 8x8 Indemnitees based upon a finding that any ST Technology infringes the IP Rights of a third party ("8x8 Infringement Claim"), provided that: (i) 8x8 gives written notice to ST within ten (10) business days of notice of such 8x8 Infringement Claim; (ii) 8x8 allows ST at its expense through attorneys of its own choice, to exclusively defend or control the defense of any 8x8 Infringement Claim; and (iii) 8x8 assists ST in all reasonable aspects in such investigation and defense, and is reimbursed by ST for all the reasonable costs incurred in collaborating in such investigation and defense. The foregoing indemnity obligations shall specifically not apply to any claim excluded under Section (b) below. If, as a result of a 8x8 Infringement Claim, 8x8 Indemnitees are enjoined from using the ST Technology, or selling 8x8 LX Chips, ST may in its sole discretion, (i) procure for 8x8 Indemnitees the right to use the ST Technology under the same terms and conditions set forth in this Section or (ii) provide 8x8 Indemnitees with modified ST Technology that is non- infringing while still meeting substantially the same functional specifications as the ST Technology.
   
2. ST shall have no obligation hereunder for any 8x8 Infringement Claim which results from: (a) the combination of the ST Technology with other products ; (b) the modification of the ST Technology by parties other than ST (or not authorized by ST); (c) the Enhancements of the ST Technology by or for 8x8.
   
3. THIS SECTION STATES THE ENTIRE LIABILITY OF ST AND THE EXCLUSIVE REMEDY OF 8x8 WITH RESPECT TO ANY AND ALL INFRINGEMENT CLAIMS. EXCEPT AS EXPRESSLY STATED IN THIS SECTION, ALL WARRANTIES OF NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS ARE HEREBY DISCLAIMED BY ST.
   
25. Term and Termination.
    
1. This Agreement shall become effective upon the Effective Date and shall continue for a period of five (5) years ("Term"), extended with additional one-year renewal periods should the parties agree in writing.
   
2. This Agreement may be terminated by either party upon notice if the other party (i) breaches any material term or condition of this Agreement and fails to remedy the breach within thirty (30) days after being given notice thereof, or (ii) becomes the subject of any voluntary or involuntary proceeding under the applicable national or state bankruptcy or insolvency laws and such proceeding is not terminated within sixty (60) days of its commencement.
   
3. In the event of termination of this Agreement for breach or bankruptcy as provided herein, the license rights of the non-terminated party pursuant to licenses granted hereunder shall survive such termination, and the license rights of the terminated party pursuant to the licenses granted hereunder shall survive only to the extent required to protect the interest of existing, committed customers of the terminated party, and in particular the terminated party shall have the right to (i) complete and sell or otherwise dispose of any work-in-progress existing in its manufacturing plants at the time of termination, (ii) sell and otherwise dispose of any relevant product in stock, (iii) complete any orders for relevant product existing at the time of termination and (iv) continue to provide technical support to its customers.
   
4. Notwithstanding anything to the contrary herein, no expiration or termination of this Agreement shall diminish the rights of any customer who has purchased product to continue to use and/or sell or otherwise dispose of the same.
   
5. Notwithstanding anything to the contrary herein, no expiration or termination of this Agreement shall relieve either party of its obligation to pay any sum due hereunder.
   
6. The provisions of Sections 22, 23, 24, 25, 26, 27,and 30 shall survive any termination of this Agreement.
   
7. Furthermore, unless terminated under Section 25(b) above, the provisions of Sections 3, 4, 6, 8 and 11shall survive termination of this agreement to the extent that either party may, under the terms of this Agreement (i) complete any product development work-in-progress prior to the date of termination but not initiate any new product development effort using the technology licensed hereunder; (ii) continue to make, have manufactured, commercialize, sell or otherwise dispose of products subject to the licenses herein; and (iii) continue to sublicense the rights to its customers to develop, make, have manufactured, commercialize, sell or otherwise dispose of products that contain the technology subject to the licenses herein.
   
26. Confidentiality
    
1. For the purposes of this agreement, Confidential Information shall mean the terms of this Agreement as well as any proprietary information and data of either party, contained in written or tangible form which is marked as "Internal Use Only", "Proprietary", "Confidential", or similar words. One party's, including its Affiliates ("Disclosing Party") Confidential Information shall also include its confidential information and data orally disclosed to the other party including its Affiliates ("Receiving Party")as long as such verbal disclosures are marked as "Confidential" or similar wording within 30 days of the verbal disclosure. However, Confidential Information shall not include any data or information which:
   
1. Is or becomes publicly available through no fault of the Receiving Party;
   
2. Is already in the rightful possession of the Receiving Party prior to its receipt of such data or information;
   
3. Is independently developed by the Receiving Party without reference to the Confidential Information of the Disclosing Party;
   
4. Is rightfully obtained by the Receiving Party from a third party or in the public domain;
   
5. Is disclosed with the written consent of the Party whose information it is; or
   
6. Is disclosed pursuant to court order or other legal compulsion, after providing prior written notice to the Disclosing Party of the intended disclosure.
   
2. The Receiving Party shall and for a period of ten (10) years following receipt of the Confidential Information, hold all Confidential Information of the Disclosing Party in confidence, not disclose such Confidential Information to any third parties except those with a need to know in connection with or during the performance of this Agreement who have executed a confidentiality agreement with terms at least as restrictive with regard to the Disclosing Party's information as those set forth herein, and in general use the same degree of care to protect the confidentiality of the Disclosing Party's Confidential Information as it uses with respect to its own information of a similar nature.
   
3. Neither 8x8 nor ST shall use the other party's Confidential Information for another or other purpose than for the purposes set forth in this Agreement.
   
4. Except as otherwise provided in Section 25(a) above, upon termination of this Agreement all of the Disclosing Party`s Confidential Information and all copies thereof in the Receiving Party's possession or control shall be immediately returned to the Disclosing Party or destroyed by the Receiving Party at the Disclosing Party's instruction. The Receiving Party shall then certify the same in writing and that no copies have been retained by the Receiving Party, its employees, Affiliates, contractors, or other parties to whom such information is provided.
   
5. The Receiving Party acknowledges that the unauthorized disclosure of the Disclosing Party Confidential Information will cause irreparable harm and significant injury, the scope of which is difficult to ascertain. Accordingly, the Receiving Party agrees that the Disclosing Party shall have the right to an immediate injunction enjoining any such unauthorized disclosure.
   
27. Limitation of Liability
    
1. EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER OR TO ANY THIRD PARTY FOR ANY SPECIAL, INDIRECT, PUNITIVE, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION, LOSS OF PROFITS), CAUSED BY ANY BREACH OF ITS OBLIGATIONS TO THE OTHER ARISING OUT OF OR RELATING TO THIS AGREEMENT, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT OR IN TORT, EVEN IF THE BREACHING PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
   
2. IN NO EVENT SHALL THE TOTAL LIABILITY OF 8x8 TO ST ARISING UNDER SECTION 23 "INDEMNIFICATION" HEREOF EXCEED THE TOTAL AMOUNT PAID BY ST TO 8x8 WITH RESPECT TO THE 8X8 CODE CONTAINING THE IP RIGHTS SUBJECT MATTER OF THE CLAIM, PROVIDED THAT SUCH TOTAL AMOUNT SHALL NOT EXCEED THE LESSER OF THE AMOUNT OF ROYALTIES PAID BY ST TO 8x8 HEREUNDER OR FIVE HUNDRED THOUSAND U.S. DOLLARS ($500,000).
   
3. IN NO EVENT SHALL THE TOTAL LIABILITY OF ST TO 8x8 ARISING UNDER SECTION 24 "INDEMNIFICATION" HEREOF EXCEED THE TOTAL AMOUNT PAID BY 8x8 TO ST WITH RESPECT TO THE LX TECHNOLOGY CONTAINING THE IP RIGHTS SUBJECT MATTER OF THE CLAIM, PROVIDED THAT SUCH TOTAL AMOUNT SHALL NOT EXCEED THE LESSER OF THE AMOUNT OF ROYALTIES PAID BY 8X8 TO ST HEREUNDER OR FIVE HUNDRED THOUSAND U.S. DOLLARS ($500,000).
   
4. IN NO EVENT SHALL THE TOTAL LIABILITY OF EITHER PARTY TO THE OTHER PARTY FOR ANY LOSS, DAMAGE OR LIABILITY ARISING FROM A BREACH OF THIS AGREEMENT EXCEED THE LESSER OF THE SUM TOTAL OF THE ROYALTIES PAID BY THE NON-PAYING PARTY OR FIVE HUNDRED THOUSAND DOLLARS ($500,000) PROVIDED (1) THAT SUCH LIMIT SHALL NOT APPLY IN THE EVENT OF A WILLFUL MISUSE OR WILLFULLY UNLAWFUL DISTRIBUTION OF THE TECHNOLOGY LICENSED HEREUNDER, AND (2) PROVIDED THAT SUCH LIMITATION SHALL NOT APPLY IN THE EVENT THAT EITHER PARTY FAILS TO PAY THE ROYALTIES DUE BY ONE PARTY TO THE OTHER AS SET FORTH HEREIN, NOTWITHSTANDING THE ABOVE LANGUAGE IN (2), THE TOTAL LIABILITY OWED IN A DISPUTE FOR ROYALTIES SHALL BE THE AMOUNT OF ROYALTIES OWED PLUS ANY INTEREST OWED UNDER SECTION 14.
28. Affiliates. Both parties will be able to apply this agreement and the license herein to itself and its affiliate companies. Affiliate companies shall be defined to be an entity controlling, controlled by, or under common control as of the Effective Date or thereafter during the term of this Agreement, with ST or 8x8 as the case may be, provided that such entity shall be considered an Affiliate only for the time during which such control exists. For purposes of this definition "control" shall mean ownership or control, either directly or indirectly, of greater than 50% of the voting rights of such entity.
29. Public Announcements. 8x8 and ST will use reasonable efforts to issue a mutually agreeable joint press release. Otherwise, neither party shall make any announcement or press release regarding this Agreement or any terms thereof without the other Party's prior written consent. However, either party is free to file with the SEC or other relevant government agencies any document required to be filed thereon advice of counsel (redacted in a form advised by counsel).
30. Assignment. This Agreement may not be assigned by either party, nor any of such party's rights or obligations hereunder, to any third party including without limitation through a U.S. Bankruptcy Code Chapter 11 reorganization, without prior written consent of the other party. For purposes of this section, a change of control of a Party resulting from one transaction or a series of related transactions shall be deemed to result in an assignment or transfer of this Agreement. Control shall mean direct or indirect ownership or control of fifty percent (50%) or more of the outstanding shares of stock entitled to vote for the election of directors (other than restricted shares of stock). In the event that this Agreement is assigned effectively to a third party, this Agreement shall bind upon successors and assigns of the Parties hereto.
    
31. Force Majeure. Neither party shall be liable to the other party for failure of or delay in performance of any obligation under this Agreement, directly or indirectly, owing to acts of God, war, war-like condition, embargoes, riots, strike and other events beyond its reasonable control. In the event that such failure or delay occurs, the affected party shall notify the other party of the occurrence thereof as soon as possible and the parties shall discuss the best way to resolve the event of force majeure.
32. Notices. All notices provided for in connection with this Agreement shall be given in writing and shall be effective (i) upon receipt, when served by personal delivery; or (ii) the next day following the date of transmittal when transmitted by facsimile; or (iii) on the third day following the date of transmittal when transmitted by express mail; or (iv) on the 7th day following the date of mailing when sent by registered airmail of the sender's country with postage prepaid, addressed to the Party as follows, or to a changed address as the Party shall have specified by prior written notice: ST: ST Microelectronics, Inc. at 1310 Electronics Drive Carrollton, TX 75006 USA. Attention: General Counsel; and 8x8: 8x8, Inc. 2445 Mission College Blvd. Santa Clara, California 95054 Attention: Chief Financial Officer.
33. Waiver. The waiver by either party of the remedy for the other party's breach of or its right under this Agreement will not constitute a waiver of the remedy for any other similar or subsequent breach or right.
34. Severability. If any provision of this Agreement is or becomes, at any time or for any reason, unenforceable or invalid, no other provision of this Agreement shall be affected thereby, and the remaining provisions of this Agreement shall continue with the same force and effect as if such unenforceable or invalid provisions had not been inserted in this Agreement.
35. Amendment. No changes, modifications or alterations to this Agreement shall be valid unless reduced to writing and duly signed by the respective authorized representative of each party.
36. Governing Law. This Agreement shall be interpreted, construed and enforced in accordance with the laws of the State of Delaware, USA without respect to its conflict of law provisions.
37. No Partnership. In giving effect to this Agreement, no party shall be or be deemed to be an agent or employee of another party for any purpose, and that their relationship to each other shall be that of independent contractors. Nothing in this Agreement shall constitute a partnership or a joint venture between the parties. No party shall have the right to enter into contracts or pledge the credit of or incur expenses or liability on behalf of the other party.
    
38. 8X8 acknowledges that in consideration of the licenses granted by ST herein, 8X8 agrees that for the Term of the Agreement the 8X8 LX Chips shall be restricted to applications that include audio telephony and/or video telephony functions unless otherwise specifically agreed to in writing between the parties. In the event that ST and 8x8 determine that 8x8 is attempting to sell the 8x8 LX Chips and ST is attempting to sell ST Chips to the same prospect or customer for the same application, the parties agree to negotiate in good faith to avoid confusing such a customer.
39. Entire Agreement. This Agreement constitute the entire agreement between the parties and supersede all prior proposal(s) and discussions relative to the subject matter of this Agreement and neither of the parties shall be bound by any conditions, definitions, warranties, understandings or representations with respect to the subject matter other than as expressly provided herein. The terms and conditions contained herein and the appendixes attached hereto constitute the entire agreement between the parties and shall supersede all previous communications either oral or written between the parties with respect to the subject matter hereof. No oral explanation or oral information by either party hereto shall alter the meaning or interpretation of this Agreement.

Exhibit 10.22

NETERGY MICROELECTRONICS, INC.

1. Purposes of the Plan. The purposes of this Stock Option Plan are to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to Employees, Directors and Consultants and 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.
2. Definitions. As used herein, the following definitions shall apply:

1. "Administrator" means the Board or any of its Committees as shall be administering the Plan in accordance with Section 4 hereof.
2. "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 other country or jurisdiction where Options are granted under the Plan.
3. "Board" means the Board of Directors of the Company.
4. "Change in Control" means the occurrence of any of the following events:
1. Any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the "beneficial owner" (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company's then outstanding voting securities; or
2. The consummation of the sale or disposition by the Company of all or substantially all of the Company's assets; or
3. The consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation.
5. "Code" means the Internal Revenue Code of 1986, as amended.
6. "Committee" means a committee of Directors appointed by the Board in accordance with Section 4 hereof.
7. "Common Stock" means the Common Stock of the Company.
8. "Company" means Netergy Microelectronics, Inc., a California corporation.
9. "Consultant" means any natural person who is engaged by the Company or any Parent or Subsidiary to render consulting or advisory services to such entity and who satisfies the requirements of subsection (c)(1) of Rule 701 under the Securities Act of 1933, as amended.
10. "Director" means a member of the Board.
11. "Disability" means total and permanent disability as defined in Section 22(e)(3) of the Code.
12. "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 (90) 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, then three (3) months following the 91st 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.
13. "Exchange Act" means the Securities Exchange Act of 1934, as amended.
14. "Fair Market Value" means, as of any date, the value of Common Stock determined as follows:

1. 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 on the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;
2. If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Common Stock on the day of determination; or
3. 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. "Incentive Stock Option" means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.
16. "Nonstatutory Stock Option" means an Option not intended to qualify as an Incentive Stock Option.
17. "Option" means a stock option granted pursuant to the Plan.
18. "Option Agreement" means a written or electronic 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.
19. "Optioned Stock" means the Common Stock subject to an Option.
20. "Optionee" means the holder of an outstanding Option granted under the Plan.
21. "Parent" means a "parent corporation," whether now or hereafter existing, as defined in Section 424(e) of the Code.
22. "Plan" means this 2000 Stock Option Plan.
23. "Service Provider" means an Employee, Director or Consultant.
24. "Share" means a share of the Common Stock, as adjusted in accordance with Section 12 below.
25. "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 12 of the Plan, the maximum aggregate number of Shares that may be subject to option and sold under the Plan is 5,000,000 Shares. The Shares may be authorized but unissued, or reacquired Common Stock.

If an Option expires or becomes unexercisable without having been exercised in full, the unpurchased Shares which were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has terminated). However, Shares that have actually been issued under the Plan, upon exercise of an Option, 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 issued pursuant to an Option 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.

1. Administrator. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws.
2. Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities, the Administrator shall have the authority in its discretion:

1. to determine the Fair Market Value;
2. to select the Service Providers to whom Options may from time to time be granted hereunder;
3. to determine the number of Shares to be covered by each such Option granted hereunder;
4. to approve forms of agreement for use under the Plan;
5. to determine the terms and conditions of any Option granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options 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 the Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine;
6. 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 satisfying applicable foreign laws;
7. 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 that number of Shares having a Fair Market Value equal to the minimum 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 Optionees 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; and
8. to construe and interpret the terms of the Plan and Options granted pursuant to the Plan.

3. Effect of Administrator's Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Optionees.
5. Eligibility. Nonstatutory Stock Options may be granted to Service Providers. Incentive Stock Options may be granted only to Employees.
6. Limitations.
1. Incentive Stock Option Limit. 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.
2. At-Will Employment. Neither the Plan nor any Option shall confer upon any Optionee any right with respect to continuing the Optionee's relationship as a Service Provider with the Company, nor shall it interfere in any way with his or her right or the Company's right to terminate such relationship at any time, with or without cause, and with or without notice.

7. Term of Plan. Subject to shareholder approval in accordance with Section 18, the Plan shall become effective upon its adoption by the Board. Unless sooner terminated under Section 14, it shall continue in effect for a term of ten (10) years from the later of (i) the effective date of the Plan, or (ii) the date of the most recent Board approval of an increase in the number of shares reserved for issuance under the Plan.
8. Term of Option. The term of each Option shall be stated in the Option Agreement; provided, however, that the term shall be no more than ten (10) years from the date of grant thereof. In the case of an Incentive Stock Option granted to an Optionee who, at the time the 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 term of the 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.

1. Exercise Price. The per share exercise price for the Shares to be issued upon exercise of an Option shall be such price as is determined by the Administrator, but shall be subject to the following:

1. In the case of an Incentive Stock Option

1. granted to an Employee who, at the time of grant of such Option, 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 exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.
2. granted to any other Employee, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant.

2. In the case of a Nonstatutory Stock Option

1. granted to a Service Provider who, at the time of grant of such Option, 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 exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.
2. granted to any other Service Provider, the per Share exercise price shall be no less than 85% of the Fair Market Value per Share on the date of grant.

3. Notwithstanding the foregoing, Options may be granted with a per Share exercise price other than as required above pursuant to a merger or other corporate transaction.

2. Forms of Consideration. The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator (and, in the case of an Incentive Stock Option, shall be determined at the time of grant). Such consideration may consist of, without limitation, (1) cash, (2) check, (3) promissory note, (4) other Shares, provided Shares acquired directly from the Company (x) have been owned by the Optionee for more than six (6) months on the date of surrender, and (y) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which such Option shall be exercised, (5) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan, or (6) any combination of the foregoing methods of payment. In making its determination as to the type of consideration to accept, the Administrator shall consider if acceptance of such consideration may be reasonably expected to benefit the Company. Notwithstanding the foregoing, the Administrator may permit an Optionee to exercise his or her Option by delivery of a full-recourse promissory note secured by the purchased Shares. The terms of such promissory note shall be determined by the Administrator in its sole discretion.

10. Exercise of Option.

1. Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable according to the terms hereof at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement. Except in the case of Options granted to officers, Directors and Consultants, Options shall become exercisable at a rate of no less than 20% per year over five (5) years from the date the Options are granted. Unless the Administrator provides otherwise, vesting of Options granted hereunder to officers and Directors shall be suspended 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 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.

Exercise of an Option in any manner shall result in a decrease in 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.

2. Termination of Relationship as a Service Provider. If an Optionee ceases to be a Service Provider, such Optionee may exercise his or her Option within thirty (30) days of termination, or such longer period of time as specified in the Option Agreement, to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of the Option as set forth in the Option Agreement). 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.
3. Disability of Optionee. If an Optionee ceases to be a Service Provider as a result of the Optionee's Disability, the Optionee may exercise his or her Option within six (6) months of termination, or such longer period of time as specified in the Option Agreement, to the extent the Option is vested on 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, 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.
4. Death of Optionee. If an Optionee dies while a Service Provider, the Option may be exercised within six (6) months following Optionee's death, or such longer period of time as specified in the Option Agreement, to the extent that the Option is vested on the date of death (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement) by the Optionee's designated beneficiary, provided such beneficiary has been designated prior to Optionee's death in a form acceptable to the Administrator. If no such beneficiary has been designated by the Optionee, then such Option may be exercised by the personal representative of the Optionee's estate or by the person(s) to whom the Option is transferred pursuant to the Optionee's will or in accordance with the laws of descent and distribution. 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. 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.

11. Limited Transferability of Options. Unless determined otherwise by the Administrator, Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or the laws of descent and distribution, and may be exercised during the lifetime of the Optionee, only by the Optionee. If the Administrator in its sole discretion makes an Option transferable, such Option may only be transferred by (i) will, (ii) the laws of descent and distribution, (iii) instrument to an inter vivos or testamentary trust in which the Option is to be passed to beneficiaries upon the death of the Optionee, or (iv) gift to a member of Optionee's immediate family (as such term is defined in Rule 16a-1(e) of the Exchange Act). In addition, any transferable Option shall contain additional terms and conditions as the Administrator deems appropriate.
12. Adjustments Upon Changes in Capitalizati on, Merger or Change in Control.

1. Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number and type of Shares which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option, and the number and type of Shares covered by each outstanding Option, as well as the price per Share covered by each such outstanding Option, shall be proportionately adjusted for any increase or decrease in the number or type of issued Shares 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, type or price of Shares subject to an Option.
2. 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 until fifteen (15) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option 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 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 will terminate immediately prior to the consummation of such proposed action.
3. Change in Control. In the event of a Change in Control, each outstanding option shall automatically accelerate so that each such option shall, immediately prior to the effective date of the Change in Control, become fully exercisable with respect to the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. However, an outstanding option shall not so accelerate if and to the extent the acceleration of such option is subject to other limitations imposed by the Administrator at the time of the option grant.

Immediately following the consummation of the Change in Control, all outstanding options shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof).

The portion of any Incentive Stock Option accelerated in connection with a Change in Control shall remain exercisable as an Incentive Stock Option only to the extent the applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be exercisable as a Nonstatutory Stock Option under Federal tax laws.

The outstanding options shall in no way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

13. Time of Granting Options. The date of grant of an Option shall, for all purposes, be the date on which the Administrator makes the determination granting such Option, or such later date as is determined by the Administrator. Notice of the determination shall be given to each Service Provider to whom an Option is so granted within a reasonable time after the date of such grant.
14. Amendment and Termination of the Pl an.

1. Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan.
2. Shareholder Approval. The Board shall obtain shareholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws.
3. 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.

15. Conditions Upon Issuance of Shares.< /LI>

    1. Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option 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.
    2. Investment Representations. As a condition to the exercise of an Option, the Administrator may require the person exercising such Option 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.

16. 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.
17. Reservation of Shares. The Company, during the term of this Plan, shall at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.
18. 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 degree and manner required under Applicable Laws.
19. Information to Optionees. The Company shall provide to each Optionee and to each individual who acquires Shares pursuant to the Plan, not less frequently than annually during the period such Optionee has one or more Options outstanding, and, in the case of an individual who acquires Shares pursuant to the Plan, during the period such individual owns such Shares, copies of annual financial statements. The Company shall not be required to provide such statements to key employees whose duties in connection with the Company assure their access to equivalent information.

Exhibit 10.23

CENTILE, INC.

1. Purposes of the Plan. The purposes of this Stock Option Plan are to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to Employees, Directors and Consultants and 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.
2. Definitions. As used herein, the following definitions shall apply:

1. "Administrator" means the Board or any of its Committees as shall be administering the Plan in accordance with Section 4 hereof.
2. "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 other country or jurisdiction where Options are granted under the Plan.
3. "Board" means the Board of Directors of the Company.
4. "Change in Control" means the occurrence of any of the following events:
1. Any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the "beneficial owner" (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company's then outstanding voting securities; or
2. The consummation of the sale or disposition by the Company of all or substantially all of the Company's assets; or
3. The consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation.
5. "Code" means the Internal Revenue Code of 1986, as amended.
6. "Committee" means a committee of Directors appointed by the Board in accordance with Section 4 hereof.
7. "Common Stock" means the Common Stock of the Company.
8. "Company" means Centile, Inc., a Delaware corporation.
9. "Consultant" means any natural person who is engaged by the Company or any Parent or Subsidiary to render consulting or advisory services to such entity and who satisfies the requirements of subsection (c)(1) of Rule 701 under the Securities Act of 1933, as amended.
10. "Director" means a member of the Board.
11. "Disability" means total and permanent disability as defined in Section 22(e)(3) of the Code.
12. "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 (90) 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, then three (3) months following the 91st 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.
13. "Exchange Act" means the Securities Exchange Act of 1934, as amended.
14. "Fair Market Value" means, as of any date, the value of Common Stock determined as follows:

1. 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 on the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;
2. If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Common Stock on the day of determination; or
3. 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. "Incentive Stock Option" means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.
16. "Nonstatutory Stock Option" means an Option not intended to qualify as an Incentive Stock Option.
17. "Option" means a stock option granted pursuant to the Plan.
18. "Option Agreement" means a written or electronic 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.
19. "Optioned Stock" means the Common Stock subject to an Option.
20. "Optionee" means the holder of an outstanding Option granted under the Plan.
21. "Parent" means a "parent corporation," whether now or hereafter existing, as defined in Section 424(e) of the Code.
22. "Plan" means this 2001 Stock Option Plan.
23. "Service Provider" means an Employee, Director or Consultant.
24. "Share" means a share of the Common Stock, as adjusted in accordance with Section 12 below.
25. "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 12 of the Plan, the maximum aggregate number of Shares that may be subject to option and sold under the Plan is 4,500,000 Shares. The Shares may be authorized but unissued, or reacquired Common Stock.

If an Option expires or becomes unexercisable without having been exercised in full, the unpurchased Shares which were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has terminated). However, Shares that have actually been issued under the Plan, upon exercise of an Option, 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 issued pursuant to an Option 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.

1. Administrator. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws.
2. Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities, the Administrator shall have the authority in its discretion:

1. to determine the Fair Market Value;
2. to select the Service Providers to whom Options may from time to time be granted hereunder;
3. to determine the number of Shares to be covered by each such Option granted hereunder;
4. to approve forms of agreement for use under the Plan;
5. to determine the terms and conditions of any Option granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options 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 the Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine;
6. 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 satisfying applicable foreign laws;
7. 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 that number of Shares having a Fair Market Value equal to the minimum 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 Optionees 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; and
8. to construe and interpret the terms of the Plan and Options granted pursuant to the Plan.

3. Effect of Administrator's Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Optionees.
5. Eligibility. Nonstatutory Stock Options may be granted to Service Providers. Incentive Stock Options may be granted only to Employees.
6. Limitations.
1. Incentive Stock Option Limit. 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.
2. At-Will Employment. Neither the Plan nor any Option shall confer upon any Optionee any right with respect to continuing the Optionee's relationship as a Service Provider with the Company, nor shall it interfere in any way with his or her right or the Company's right to terminate such relationship at any time, with or without cause, and with or without notice.

7. Term of Plan. Subject to shareholder approval in accordance with Section 18, the Plan shall become effective upon its adoption by the Board. Unless sooner terminated under Section 14, it shall continue in effect for a term of ten (10) years from the later of (i) the effective date of the Plan, or (ii) the date of the most recent Board approval of an increase in the number of shares reserved for issuance under the Plan.
8. Term of Option. The term of each Option shall be stated in the Option Agreement; provided, however, that the term shall be no more than ten (10) years from the date of grant thereof. In the case of an Incentive Stock Option granted to an Optionee who, at the time the 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 term of the 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.

1. Exercise Price. The per share exercise price for the Shares to be issued upon exercise of an Option shall be such price as is determined by the Administrator, but shall be subject to the following:

1. In the case of an Incentive Stock Option

1. granted to an Employee who, at the time of grant of such Option, 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 exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.
2. granted to any other Employee, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant.

2. In the case of a Nonstatutory Stock Option

1. granted to a Service Provider who, at the time of grant of such Option, 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 exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.
2. granted to any other Service Provider, the per Share exercise price shall be no less than 85% of the Fair Market Value per Share on the date of grant.

3. Notwithstanding the foregoing, Options may be granted with a per Share exercise price other than as required above pursuant to a merger or other corporate transaction.

2. Forms of Consideration. The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator (and, in the case of an Incentive Stock Option, shall be determined at the time of grant). Such consideration may consist of, without limitation, (1) cash, (2) check, (3) promissory note, (4) other Shares, provided Shares acquired directly from the Company (x) have been owned by the Optionee for more than six (6) months on the date of surrender, and (y) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which such Option shall be exercised, (5) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan, or (6) any combination of the foregoing methods of payment. In making its determination as to the type of consideration to accept, the Administrator shall consider if acceptance of such consideration may be reasonably expected to benefit the Company. Notwithstanding the foregoing, the Administrator may permit an Optionee to exercise his or her Option by delivery of a full-recourse promissory note secured by the purchased Shares. The terms of such promissory note shall be determined by the Administrator in its sole discretion.

10. Exercise of Option.

1. Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable according to the terms hereof at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement. Except in the case of Options granted to officers, Directors and Consultants, Options shall become exercisable at a rate of no less than 20% per year over five (5) years from the date the Options are granted. Unless the Administrator provides otherwise, vesting of Options granted hereunder to officers and Directors shall be suspended 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 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.

Exercise of an Option in any manner shall result in a decrease in 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.

2. Termination of Relationship as a Service Provider. If an Optionee ceases to be a Service Provider, such Optionee may exercise his or her Option within thirty (30) days of termination, or such longer period of time as specified in the Option Agreement, to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of the Option as set forth in the Option Agreement). 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.
3. Disability of Optionee. If an Optionee ceases to be a Service Provider as a result of the Optionee's Disability, the Optionee may exercise his or her Option within six (6) months of termination, or such longer period of time as specified in the Option Agreement, to the extent the Option is vested on 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, 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.
4. Death of Optionee. If an Optionee dies while a Service Provider, the Option may be exercised within six (6) months following Optionee's death, or such longer period of time as specified in the Option Agreement, to the extent that the Option is vested on the date of death (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement) by the Optionee's designated beneficiary, provided such beneficiary has been designated prior to Optionee's death in a form acceptable to the Administrator. If no such beneficiary has been designated by the Optionee, then such Option may be exercised by the personal representative of the Optionee's estate or by the person(s) to whom the Option is transferred pursuant to the Optionee's will or in accordance with the laws of descent and distribution. 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. 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.

11. Limited Transferability of Options. Unless determined otherwise by the Administrator, Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or the laws of descent and distribution, and may be exercised during the lifetime of the Optionee, only by the Optionee. If the Administrator in its sole discretion makes an Option transferable, such Option may only be transferred by (i) will, (ii) the laws of descent and distribution, (iii) instrument to an inter vivos or testamentary trust in which the Option is to be passed to beneficiaries upon the death of the Optionee, or (iv) gift to a member of Optionee's immediate family (as such term is defined in Rule 16a-1(e) of the Exchange Act). In addition, any transferable Option shall contain additional terms and conditions as the Administrator deems appropriate.
12. Adjustments Upon Changes in Capitalizati on, Merger or Change in Control.

1. Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number and type of Shares which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option, and the number and type of Shares covered by each outstanding Option, as well as the price per Share covered by each such outstanding Option, shall be proportionately adjusted for any increase or decrease in the number or type of issued Shares 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, type or price of Shares subject to an Option.
2. 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 until fifteen (15) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option 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 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 will terminate immediately prior to the consummation of such proposed action.
3. Change in Control. In the event of a Change in Control, each outstanding option shall automatically accelerate so that each such option shall, immediately prior to the effective date of the Change in Control, become fully exercisable with respect to the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. However, an outstanding option shall not so accelerate if and to the extent the acceleration of such option is subject to other limitations imposed by the Administrator at the time of the option grant.

Immediately following the consummation of the Change in Control, all outstanding options shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof).

The portion of any Incentive Stock Option accelerated in connection with a Change in Control shall remain exercisable as an Incentive Stock Option only to the extent the applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be exercisable as a Nonstatutory Stock Option under Federal tax laws.

The outstanding options shall in no way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

13. Time of Granting Options. The date of grant of an Option shall, for all purposes, be the date on which the Administrator makes the determination granting such Option, or such later date as is determined by the Administrator. Notice of the determination shall be given to each Service Provider to whom an Option is so granted within a reasonable time after the date of such grant.
14. Amendment and Termination of the Pl an.

1. Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan.
2. Shareholder Approval. The Board shall obtain shareholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws.
3. 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.

15. Conditions Upon Issuance of Shares.< /LI>

    1. Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option 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.
    2. Investment Representations. As a condition to the exercise of an Option, the Administrator may require the person exercising such Option 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.

16. 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.
17. Reservation of Shares. The Company, during the term of this Plan, shall at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.
18. 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 degree and manner required under Applicable Laws.
19. Information to Optionees. The Company shall provide to each Optionee and to each individual who acquires Shares pursuant to the Plan, not less frequently than annually during the period such Optionee has one or more Options outstanding, and, in the case of an individual who acquires Shares pursuant to the Plan, during the period such individual owns such Shares, copies of annual financial statements. The Company shall not be required to provide such statements to key employees whose duties in connection with the Company assure their access to equivalent information.

Exhibit 10.24

INVESTMENT AGREEMENT