Via Licensing

Advanced Audio Coding (AAC)

Licensed Products (Other than PC Software) – "Standard Rates"

Consumer Products

Volume (per unit*/annual reset)	Per Unit Fee
For the first 1 to 500,000 units	$ 0.98
For units 500,001 to 1,000,000	$ 0.76
For units 1,000,001 to 2,000,000	$ 0.62
For units 2,000,001 to 5,000,000	$ 0.52
For units 5,000,001 to 10,000,000	$ 0.42
For units 10,000,001 to 20,000,000	$ 0.24
For units 20,000,001 to 50,000,000	$ 0.20
For units 50,000,001 or more	$ 0.15
* Consumer Products with more than two Channels count as 1.5 units.

Professional Products

	Decoder Products	Encoder/Codec Products
Per Unit Fee	$5.00	$50.00

PC Software

Consumer PC Software

	Decoder Products	Encoder/Codec Products
Per Unit Fee	$0.48	$0.98
Maximum Annual Payment	$32,000 per PC Software Product	$344,000 per Licensee

PC Enabling Software

	Decoding	Any combination of encoding and decoding
Annual Fee	$300,000	$1,200,000

Professional PC Software

	Decoder Products	Encoder/Codec Products
Per Unit Fee	$5.00	$50.00
Maximum Fee per PC Software Product	n/a	Not to exceed 5% of end-user price, but not less than $12.50 per unit.

Cellular Telephone Committed Volume Option²

A discount from the Consumer Product rates is available to Licensees that commit to paying the applicable fees for a specific annual volume of cellular telephone products. Licensee may make a commitment for any number of phones above 7,500,000 according to the following table. Fees for units sold in excess of the committed volume amount are calculated according to the applicable volume tier(s) of the Standard Rate table, above.

Annual Volume Commitment		Fee
From	To	Fee
First	7,500,000	$3,000,000
7,500,001	10,000,000	$0.28 each
10,000,001	20,000,000	$0.14 each
20,000,001	50,000,000	$0.11 each
50,000,001	more	$0.06 each

²Units accounted for under the Cellular Telephone Committed Volume Option may not be aggregated together with units accounted for under the Standard Rate table.

Committed Volume Option calculation example: A licensee elects a committed volume amount of 12M, but ships 12.8M in an annual period. The fees are calculated as follows: $3M for the first 7.5M phones + $700,000 for the next 2.5M phones (2,500,000 x $0.28) + $280,000 for the next 2M phones (2,000,000 x $0.14) + $192,000 (800,000 x $0.24) for the 800,000 phones over the committed volume amount of 12M. This totals $4,172,000, or an average price of $0.33 per phone.