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Housing Supplement and Loan Arrangement - Liberate Technologies and Coleman Sisson

                                             February 28, 2000

Mr. Coleman Sisson


Dear Coleman:

          This letter confirms our agreement to make certain financial 
accommodations available to you in connection with your purchase of a new 
home in Northern California (the 'New Residence'), which will modify the 
terms of your employment letter dated November 5, 1999 (the 'Employment 
Agreement').  We have agreed as follows:

   (1)    We agree to accelerate the payment of a prorata portion (calculated 
          through May 31, 2000) of your guaranteed $125,000 target annual 
          bonus, provided that you agree to repay to Liberate such 
          accelerated payments if you voluntarily terminate your employment 
          prior to the first anniversary of your hire date or you are 
          terminated for 'Cause' (as defined in the Employment Agreement) 
          before such date.

  (2)     Liberate will pay you a supplemental monthly housing expense 
          allowance equal to the difference between your monthly mortgage 
          payment (currently estimated to be roughly $9,000 per month) for 
          your new residence less the amount of your current monthly mortgage 
          payment on your residence in Washington (the 'Monthly Supplement'), 
          plus a 'grossed up' amount to cover taxes on the Monthly 
          Supplement based on the maximum applicable federal and state 
          income tax rates (the 'Grossed-up Amount').  Liberate will be 
          responsible for paying all FICA, SDI, FUTA, SUTA and other 
          applicable withholding amounts in connection with the foregoing 
          payments.  Liberate will make these payments to you commencing for 
          the month in which you begin mortgage payments on the New 
          Residence, and such payments will continue until you notify 
          Liberate that you no longer need the Monthly Supplement, but in no 
          event beyond

          January 2001.  The Grossed-up Amount will be treated as an 
          interest-free advance to you, which will be repayable by you to 
          Liberate on or before April 16, 2001.

  (3)     If you terminate your employment with us, all advanced amounts set 
          forth above will become immediately due and payable by you to 
          Liberate, and Liberate will have the option to terminate the 
          payment of the Monthly Supplement (together with the Grossed-up 
          Amount) to you.

     In all other respects, the terms of the Employment Agreement are 
unchanged and remain in full force and effect.

     You are a very critical and important member of Liberate's executive 
team, and we are pleased to be able to offer the foregoing financial 
arrangement to you.  Please confirm your understanding of the foregoing 
arrangement to Liberate by signing below.


                                       Mitchell E. Kertzman,
                                       President and Chief Executive Officer

Acknowledged and agreed:

Coleman Sisson
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