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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
      AND EXCHANGE COMMISSION </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>WASHINGTON,
      D.C. 20549 </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 14pt; FONT-FAMILY: Times New Roman"><strong>FORM
      8-K </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Current
      Report Pursuant to Section 13 or 15(d) of the </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Securities
      Exchange Act of 1934 </strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Date
      of Report (Date of Earliest Event Reported): September 20, 2006
</strong></font></div>
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      Technologies, Inc. </strong></font></div>
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      name of Registrant as specified in its charter) </font></div>
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      </strong></font></div>
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      satisfy the filing obligation of the registrant under any of the following
      provisions (see General Instruction A.2. below): </font></div>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pre-commencement
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    <div>&#160;</div>
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    <div>&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      1.01 Entry into a Material Definitive Agreement</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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      September 20, 2006, On2 Technologies, Inc. (the &#8220;Company&#8221;) extended the terms of
      the employment agreement of Eric Ameres, the Company&#8217;s Executive Vice-President
      and Chief Technology Officer, until September 15, 2009. For a description of
      Mr.
      Ameres&#8217;s employment agreement, see Notice and Proxy Statement of the Company for
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      Directors - Employment Contracts, Termination of Employment and Change in
      Control Arrangements&#8221;.</font></div>
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    <div>&#160;</div>
    <div><br>&#160;</div>
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      </font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized. </font></div>
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    <div>
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            <td align="left" valign="top" width="22%" style="border-bottom: medium none;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date:
                September 25, 2005 </font></div>
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            <td align="left" valign="top" width="38%" style="border-bottom: medium none;">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>On2
                Technologies, Inc.</strong></font></div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By:&#160;<u>&#160;&#160;&#160;
                &#160;<font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">/s/
                Bill Joll</font></u></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</u></font></div>
            </td>
            <td align="left" valign="top" style="border-bottom: medium none;">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="22%">&#160;</td>
            <td align="left" valign="top" width="38%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Name:
                &#160;&#160;&#160;&#160;&#160; Bill Joll</font></div>
            </td>
            <td align="left" valign="top">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="22%">&#160;</td>
            <td align="left" valign="top" width="38%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Title:&#160;&#160;&#160;
                &#160;&#160;&#160;&#160; President and CEO</font></div>
            </td>
            <td align="left" valign="top">&#160;</td>
          </tr>
          <tr>
            <td align="left" valign="top" width="22%">&#160;</td>
            <td align="left" valign="top" width="38%">
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                </font></div>
            </td>
            <td align="left" valign="top">&#160;</td>
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{"company-data": {"conformed-name": "ON2 TECHNOLOGIES, INC.", "cik": "0001045280", "assigned-sic": "7372", "irs-number": "841280679", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-15117", "film-number": "061106756"}, "business-address": {"street1": "21 CORPORATE DRIVE SUITE 103", "city": "CLIFTON PARK", "state": "NY", "zip": "12065", "phone": "5183480099"}, "mail-address": {"street1": "21 CORPORATE DRIVE SUITE 103", "city": "CLIFTON PARK", "state": "NY", "zip": "12065"}, "former-company": [{"former-conformed-name": "ON2 TECHNOLOGIES INC", "date-changed": "20010615"}, {"former-conformed-name": "ON2COM INC", "date-changed": "19990622"}, {"former-conformed-name": "APPLIED CAPITAL FUNDING INC", "date-changed": "19971002"}]}
SECURITIES
      AND EXCHANGE COMMISSION
WASHINGTON,
      D.C. 20549
FORM
      8-K
Current
      Report Pursuant to Section 13 or 15(d) of the
Securities
      Exchange Act of 1934
Date
      of Report (Date of Earliest Event Reported): September 20, 2006
On2
      Technologies, Inc.
(Exact
      name of Registrant as specified in its charter)
Delaware
(State
      of
      incorporation or organization)
1-15117
(Commission
      File Number)
84-1280679
(IRS
      Employer Identification No.)
21
      Corporate Drive, Suite 103, Clifton Park NY 12065
(518)
      348-0099
(Address,
      including zip code, and telephone number, including area code, of
Registrant's
      principal executive offices)
Not
      applicable
(Former
      name, former address and former fiscal year, if applicable)
Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions (see General Instruction A.2. below):
□
Written
                communications pursuant to Rule 425 under the Securities Act (17 CFR
                230.425)
□
Soliciting
                material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
                240.14a-12)
□
Pre-commencement
                communications pursuant to Rule 14d-2(b) under the Exchange Act (17
                CFR 240.14d-2(b))
□
Pre-commencement
                communications pursuant to Rule 13e-4(c) under the Exchange Act (17
                CFR 240.13e-4(c))
Item
      1.01 Entry into a Material Definitive Agreement
On
      September 20, 2006, On2 Technologies, Inc. (the "Company") extended the terms of
      the employment agreement of Eric Ameres, the Company's Executive Vice-President
      and Chief Technology Officer, until September 15, 2009. For a description of
      Mr.
      Ameres's employment agreement, see Notice and Proxy Statement of the Company for
      the Annual Stockholder Meeting on May 15, 2006, "Proposal 1 - Election of
      Directors - Employment Contracts, Termination of Employment and Change in
      Control Arrangements".
SIGNATURE
Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized.
Date:
                September 25, 2005
On2
                Technologies, Inc.
By:
/s/
                Bill Joll
Name:
                      Bill Joll
Title:   
                     President and CEO