Amendment No. 3 To Software License Agreement For Palm Os Software

Exhibit 10.20

AMENDMENT NO. 3 TO SOFTWARE LICENSE AGREEMENT


This Amendment No. 3 (this "Amendment 3") is an amendment to that Software License Agreement dated June 29, 2001 (the "Initial Agreement") by and among PalmSource, Inc., ("PalmSource"), Palm Ireland Investment and AlphaSmart, Inc., as the Initial Agreement was amended by Amendment 1 effective June 14, 2002 ("Amendment 1"), and further amended by Amendment No. 2 effective November l5, 2002 ("Amendment No. 2"). The Initial Agreement as amended by Amendment 1 and Amendment 2 is hereinafter referred to as the Amended Agreement. This Amendment 3 is made effective as of February 27, 2004 (the "Amendment 3 Effective Date"), by and among PalmSource, PalmSource Overseas Limited (the successor in interest to Palm Platform Overseas Limited, and together with PalmSource referred to as "PSI"), and AlphaSmart, Inc. ("Licensee"). The provisions of this Amendment 3 are hereby incorporated into the Amended Agreement and shall control over contradicting terms therein. All capitalized terms used herein and not defined shall have the meanings set forth in the Amended Agreement. The term "Agreement" when used herein shall mean the Initial Agreement as amended by Amendment 1, Amendment 2 and this Amendment 3.


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NOW, THEREFORE, in consideration of the mutual premises contained herein and for other good and valuable consideration, the parties hereby amend the Amended Agreement as of the Amendment 3 Effective Date as follows:

1. All references to Palm Platform Overseas Limited or Palm Ireland Investment shall be deemed henceforth to mean PalmSource Overseas Limited. All references to Palm Trademarks shall be deemed henceforth to mean PSI Trademarks.

2. The Term of the Agreement shall be extended for an additional two and one-half (2.5) years such that it shall expire at midnight on December 31, 2008. 3. Section 3 of Exhibit D of the Amended Agreement shall be amended and restated as follows: [*] This provision is the subject of a Confidential Treatment Request.

Confidential treatment has been requested with respect to the omitted portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request. Omissions are designated as [*]. A complete version of this exhibit has been filed separately with the Securities and Exchange Commission. AMENDMENT NO. 3 TO SOFTWARE LICENSE AGREEMENT


"ROYALTIES

a. Notwithstanding anything to the contrary in the Agreement, including without limitation Section 4.2 thereof, the Royalties due and payable for the [*] shipped under the Agreement (the "Initial Units Shipped") including without limitation the [*] shipped by Licensee and paid for prior to [*], shall be [*].

b. [*] Payments for the portion of the Initial Units Shipped that is comprised of the [*] of Licensee Product shipped or otherwise distributed under the Agreement [*], shall be due and payable in accordance with [*]. The actual amount to be paid (the "Actual Royalty Payment") on any particular Due Date set forth in the schedule below shall be an amount equal to the greater of (a) [*], or (b) [*]. Together, the Actual Royalty Payments and the [*] shall be referred to as the "Scheduled Royalty Payments." Each Scheduled Royalty Payment shall be made on or before the applicable scheduled date and is [*], ...