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UNITED STATES SECURITIES AND EXCHANGE
COMMISSION

Washington, D.C. 20549


Form 10-K/A

Amendment No. 1


|   |  |                                                                                                 
|-- |  | ------------------------------------------------------------------------------------------------
|þ  |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR
    15(d) OF
    THE SECURITIES EXCHANGE ACT OF 1934    
|   |  | For the fiscal year ended December 31,
    2003.                                                
|  
|or
|o  |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR
    15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934
|   |  | For the transition period
    from:           to:           .                                   

Commission file number 0-32809

Vialta, Inc.

(Exact name of registrant as specified in its
charter)


|                                                                   |  |                                         
|------------------------------------------------------------------ |  | ----------------------------------------
|Delaware                                                           |  | 94-3337236                              
|(State or Other Jurisdiction of
    Incorporation or Organization) |  | (I.R.S. Employer
    Identification No.)

48461 Fremont Boulevard

Fremont, California 94538


(Address, including zip code, of
Registrants principal executive offices)


(510) 870-3088

(Registrants telephone number, including
area code)


Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports) and
(2) has been subject to such filing requirements for the
past
90 days.     Yes þ     No o

Indicate by check mark if disclosure of
delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be
contained, to the best of registrants knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of the Form 10-K or any
amendments to this
Form 10-K.     o

Indicate by check mark whether the registrant is
an accelerated filer (as defined in Exchange Act
Rule 126-2).     Yes o     No þ

The aggregate market value of the voting and
non-voting common equity held by non-affiliates of the
registrant on June 30, 2003 (based on the average bid and
ask price on the OTC Bulletin Board as of such date) was
approximately $16,500,000.

The number of outstanding shares of the
registrants common stock, par value $0.001 per share,
on March 5, 2004 was 82,841,468 shares.

DOCUMENTS INCORPORATED BY REFERENCE

None



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EXPLANATORY NOTE

Vialta, Inc. (the Company,
Vialta, we, us or
our) is filing this Amendment No. 1 on
Form 10-K/ A to our Annual Report on Form 10-K for the
fiscal year ended December 31, 2003 (the
Report) for the purpose of including information
that was to be incorporated by reference from our definitive
proxy statement pursuant to Regulation 14A of the
Securities and Exchange Act of 1934. We will not file our proxy
statement within 120 days of our fiscal year ended
December 31, 2003, and are, therefore, amending and
restating in their entirety Items 10, 11, 12, 13 and 14 of
Part III of the Report. In addition, in connection with the
filing of this Amendment and pursuant to Rules 12b-15 and
13a-14 under the Securities and Exchange Act of 1934, as
amended, we are including with this Amendment certain currently
dated certifications. Except as described above, no other
amendments are being made to the Report. This Form 10-K/ A
does not reflect events occurring after the March 26, 2004
filing of our Report, modify or update the disclosure contained
in the Report in any way other than as required to reflect the
amendments discussed above and reflected below.



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VIALTA, INC.

TABLE OF CONTENTS






|             |  |                                                                      |    |      |    | 
|------------ |  | -------------------------------------------------------------------- | -- | ---- | -- | 
|             |  |                                                                      |    | Page
|             |  |                                                                      |    |     
|PART III    
|Item 10.     |  | Directors and Executive
    Officers of the Registrant               |    |      | 2  | 
|Item 11.     |  | Executive Compensation                                               |    |      | 5  | 
|Item 12.     |  | Security Ownership of
    Certain Beneficial Owners and Management   |    |      | 10 | 
|Item 13.     |  | Certain Relationships and
    Related Transactions                   |    |      | 11 | 
|Item 14.     |  | Principal Accountant Fees
    and Services                           |    |      | 11 | 
|PART IV     
|Item 15.     |  | Exhibits, Financial
    Statement Schedules, and Reports on Form 8-K |    |      | 12 | 
|Signature    |  |                                                                      | 13 |     
|EXHIBIT 31.1
|EXHIBIT 31.2



1



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PART III






|         |                                                       
|-------- | ------------------------------------------------------
|Item 10. | Directors and Executive Officers of the
    Registrant

DIRECTORS

Our current directors were elected at the 2003
annual meeting of shareholders to serve as directors until the
2004 annual meeting of shareholders, until their respective
successors have been elected and qualified or until such
directors earlier resignation or removal. The information
of members of the Board of Directors as of March 31, 2004
is set forth below:

|                    |  |     |    |                         |  |                                                 |  |  |      | 
|------------------- |  | --- | -- | ----------------------- |  | ----------------------------------------------- |  |  | ---- | 
|                    |  |     |    |                         |  | Director                                       
|Name                |  | Age |    | Position(s) with Vialta |  | Since                                          
|                    |  |     |    |                         |  |                                                
|Fred S.L. Chan      |  |     | 57 |                         |  | Chairman of the Board                           |  |  | 1999 | 
|Didier Pietri       |  |     | 41 |                         |  | President, Chief Executive Officer and Director |  |  | 2001 | 
|George M. Cain      |  |     | 59 |                         |  | Director                                        |  |  | 2003 | 
|Herbert Chang       |  |     | 41 |                         |  | Director                                        |  |  | 1999 | 
|Michael S. Dubester |  |     | 56 |                         |  | Director                                        |  |  | 2003 | 
|Matthew K. Fong     |  |     | 50 |                         |  | Director                                        |  |  | 1999 | 

Except as set forth below, each of the directors
has been engaged in the principal occupation set forth next to
his name above during the past five years. There are no family
relationships among any of the directors or executive officers
of the Company.

Fred S. L. Chanhas
served as the Companys Chairman of the Board of Directors
since the Companys inception in 1999. He also served as
the Companys President from its inception through April
2001 and as Chief Executive Officer from its inception through
August 2001. Prior to joining the Company, Mr. Chan founded
and held various executive positions at ESS Technology, Inc., a
designer, developer and marketer of highly integrated digital
system processor chips, since 1986, as well as being Chairman of
the Board, in which capacity he still serves.

Didier Pietrihas
been a member of Vialtas board of directors since
September 2001. Mr. Pietri joined the Company in April 2001
as its President and in August 2001 also became its Chief
Executive Officer. Prior to joining Vialta, Mr. Pietri
served as President and Chief Executive Officer of TVA/Motion
International, a global entertainment production and
distribution company from August 1999 to March 2001. From June
1995 to July 1999, Mr. Pietri was Senior Vice President of
the ABC Television Network Group, as well as President of ABC
Pictures, a division of The Walt Disney Company.

George M. Cainhas
been a member of Vialtas board of directors since February
2003. Mr. Cain is the founder and President of C3
Media & Marketing Group, LLC, a media marketing
consulting company. He has held that position since 1996.
Mr. Cain is also the founder and CEO of Strategic
Media & Marketing Group, LLC, a marketing and sales
company which has assisted a German enterprise software company
with the introduction of its products in North America. He has
held that position since 2001.

Herbert Changhas
been a member of Vialtas board of directors since November
1999. Mr. Chang is the President of InveStar Capital, Inc.,
a venture capital firm. He has held that position since August
1996. In addition, Mr. Chang is the managing member of
Forefront Associates, LLC, which is the general partner of
Forefront Venture Partners, L.P., a position he has held since
February 1998. Mr. Chang currently serves as a director of
Marvell Technology Group Ltd. and Oplink Communications, Inc.

Michael S. Dubesterhas been a member of Vialtas
board of directors since February 2003. Mr. Dubester is the
Senior Vice President of Business Development of Vulcan Sports
Media, Inc., a U.S. sports media company whose principal
business is The Sporting News. He has held that position since
2000. Prior to that, Mr. Dubester served as the President
of Times Mirror Interzines, the online network of Internet sites
affiliated with Times Mirror Magazine titles, the previous owner
of The Sporting News, from 1998 until 2000. He was the founder
and President of The Sporting News Online, from 1996 until 1998.

2



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Matthew K. Fonghas
been a member of Vialtas board of directors since April
1999. Mr. Fong was employed by the Company from September
2001 through January 31, 2003, as an Advisor to the
Chairman of the Board. In addition, since February 1999,
Mr. Fong has been an attorney with the law firm of
Sheppard, Mullin, Richter & Hampton, LLP and the Chief
Executive Officer of Strategic Advisory Group, a financial and
high technology consulting group that he founded. Prior to that,
Mr. Fong served as California State Treasurer from January
1995 to January 1999.

Board of Directors Meetings and
Committees

The Board of Directors met four times during
fiscal year 2003. The Board of Directors, during 2003, had an
Audit Committee and a Compensation Committee, but did not have a
Nominating Committee or any other standing committees.
Nominations to the Board of Directors are handled as discussed
below. Each incumbent director attended at least 75% of the
meetings of the Board and meetings of the Committees of the
Board on which he served during the fiscal year 2003. The
Company invites Board members to attend annual meetings of the
stockholders. Didier Pietri attended the last annual meeting of
stockholders.

Audit Committee.The
Audit Committee is currently comprised of three members: Matthew
Fong (Chairman), Michael Dubester and Herbert Chang.
Mr. Dubester was elected to the Audit Committee on
May 1, 2003. Mr. Chang was elected to the Audit
Committee on April 23, 2002. Currently, Mr. Chang and
Mr. Dubester are both independent as defined by the listing
standard of NASDAQ as now in effect. Prior to January 31,
2003, Mr. Fong was employed by the Company as the Advisor
to the Chairman so is not independent under such standard.
During 2003, the Board did not designate any member as a
financial expert within the meaning of applicable regulatory
standards, but believes that each member has the appropriate
experience and ability to perform their duties as Audit
Committee members.

The Audit Committee pre-approves the performance
of audit and non-audit services by the Companys
accountants and reviews the Companys internal control
systems, financial reporting procedures, the general scope of
the Companys annual audit, the fees charged by the
independent accountants, and the fairness of any proposed
transaction between any officer, director or other affiliate of
the Company and the Company. With respect to the foregoing, the
Audit Committee makes recommendations to the full Board and
performs such further functions as may be required or delegated
to the Committee by the Board of Directors. The Board of
Directors has adopted a written charter for the Audit Committee,
a copy of which is attached to the Proxy Statement filed by the
Company on April 30, 2002. During fiscal year 2003, the
Audit Committee of the Board held four meetings independent of
the entire Board of Directors.

Compensation
Committee.The Compensation Committee
is comprised of three members: Matthew Fong (Chairman), George
Cain and Michael Dubester. The Compensation Committee reviews
and approves compensation and benefits for the Companys
key executive officers, administers the Companys stock
purchase and equity incentive plans and makes recommendations to
the Board of Directors regarding such matters. During fiscal
year 2003, the Compensation Committee held two meetings
independent of the entire Board of Directors.

Nominations.The
Company does not have a nominating committee. In light of the
relatively small size of the Board of Directors, the Company
does not believe that a separate nominating committee is
currently necessary. In the interim, all current directors will
take part, as necessary, in selecting any required nominees. The
Board currently considers candidates for Board membership
suggested by its members. A stockholder who wishes to recommend
a prospective nominee for the Board should notify the
Companys Corporate Secretary in writing with whatever
supporting material the stockholder considers appropriate. The
Board will also consider whether to nominate any person
nominated by a stockholder pursuant to the provisions of the
Companys bylaws relating to stockholder nominations.

3



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EXECUTIVE OFFICERS

Our current Executive Officers are Fred S.L.
Chan, Didier Pietri and William Scharninghausen. Information
about Mr. Scharninghausen is set forth below. Information
about Messrs. Chan and Pietri is set forth above in
Directors.

William M.
Scharninghausen,47, has been Chief
Financial Officer of the Company since October 2002. Prior to
joining Vialta, he was the Chief Financial Officer of Diva
Systems, Inc., a video on demand technology company, from
January 1999 to September 2002. He also served as the Senior
Vice President of Finance and Administration of Diva Systems,
Inc. from June 1997 to September 2002. As part of Gemstar-TV
Guide International, Inc.s proposed purchase of
Divas assets, Diva filed a Chapter 11 bankruptcy
petition and pre-negotiated plan of reorganization on
May 29, 2002 in the Northern District of California.

Section 16(a) Beneficial Ownership
Reporting Compliance

Section 16 of the Securities Exchange Act of
1934, as amended, requires the Companys directors and
officers, and persons who own more than 10% of the
Companys Common Stock to file initial reports of ownership
and reports of changes in ownership. Such persons are required
by SEC regulation to furnish the Company with copies of all
Section 16(a) forms that they file. Based solely on its
review of the copies of such forms furnished to the Company and
written representations from the executive officers and
directors, the Company believes that all transactions required
to be reported pursuant to Section 16(a) for the year ended
December 31, 2003 were reported on a timely basis with the
exception of Mr. Pietri, who filed a report in July 2003
for options granted in June 2003; Mr. Cain, who filed a
form in March 2003 for options granted in February 2003;
Mr. Chang, who filed a report in June 2003 for options
granted in March 2003; Mr. Dubester, who filed a form in
March 2003 for options granted in February 2003, and
Mr. Fong, who filed a form in June 2003 for options granted
in April 2003.

Code of Ethics

Vialta has not adopted a Code of Ethics that
applies to its principal executive officer, principal financial
officer and principal accounting officer. In view of
Vialtas small size and the limited number of personnel who
are responsible for its operations, the Company has determined
that a formal code of ethics is not currently necessary. Our
Board of Directors will, however, revisit this issue in the
future to determine if adoption of a code of ethics is
appropriate. In the meantime, our management has adopted an
insider trading policy and is committed to promoting honest and
ethical conduct, full and fair disclosure in our reports to the
SEC, and compliance with applicable governmental laws and
regulations.

4



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|         |                       
|-------- | ----------------------
|Item 11. | Executive Compensation

EXECUTIVE COMPENSATION

The following table sets forth the compensation
earned by the Named Executive Officers: (1) the
Companys Chief Executive Officer and (2) the
Companys four other most highly compensated executive
officers for the fiscal year 2003.

Summary Compensation Table

|                              |                         |        |      |                     |  |              |         |                 |  |              |         |           |     |  |   |   |  |  |           |           |  |   |     |     | 
|----------------------------- | ----------------------- | ------ | ---- | ------------------- |  | ------------ | ------- | --------------- |  | ------------ | ------- | --------- | --- |  | - | - |  |  | --------- | --------- |  | - | --- | --- | 
|                              |                         |        |      |                     |  |              |         |                 |  | Long-Term    |         |          
|                              |                         |        |      |                     |  |              |         |                 |  | Compensation |         |          
|                              |                         |        |      |                     |  |              |         |                
|                              |                         |        |      | Annual Compensation |  | Awards       |         |                
|                              |                         |        |      |                     |  | Securities   |         | All Other      
|                              |                         | Fiscal |      |                     |  | Other Annual |         | Underlying      |  | Compen-     
|Name and Principal Position   |                         | Year   |      | Salary              |  | Bonus        |         | Compensation(1) |  | Options      |         | sation(2)
|                              |                         |        |      |                     |  |              |         |                 |  |              |         |          
|Fred S.L. Chan(3)             |                         |        | 2003 |                     |  | $            | 252,762 |                 |  | $            |        |           |     |  |  |   |  |  |          |           |  | $ | 175 |    
|                              | Chairman of the Board   |        |      | 2002                |  |              |         | 248,000         |  |              |         |          |     |  |   |  |  |  |           |          |  |   |     | 950 | 
|                              | of Directors            |        |      | 2001                |  |              |         | 248,000         |  |              |         |          |     |  |   |  |  |  |           |          |  |   |     | 966 | 
|Didier Pietri(4)              |                         |        | 2003 |                     |  | $            | 310,663 |                 |  | $            | 150,000 |           |     |  |  |   |  |  | 2,000,000 |           |  | $ | 175 |    
|                              | President and Chief     |        |      | 2002                |  |              |         | 300,000         |  |              |         | 175,000   | (5) |  |   |  |  |  |           |          |  |   |     | 950 | 
|                              | Executive Officer       |        |      | 2001                |  |              |         | 188,636         |  |              |         |          |     |  |   |  |  |  |           | 2,000,000 |  |   |     | 252 | 
|William M. Scharninghausen(6) |                         |        | 2003 |                     |  | $            | 183,729 |                 |  |              |        |           |     |  |  |   |  |  | 15,000    |           |  | $ | 175 |    
|                              | Chief Financial Officer |        |      | 2002                |  |              |         | 28,038          |  |              |         |          |     |  |   |  |  |  |           | 250,000   |  |   |     | 86  | 
|                              |                         |        |      | 2001                |  |              |         |                |  |              |         |          |     |  |   |  |  |  |           |          |  |   |     |    | 



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|    |                                                                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | In accordance with SEC rules, perquisites and
    personal benefits have been omitted because such benefits, if
    any, did not exceed the reporting thresholds under SEC rules.
|   
|(2) | Includes dollar value of premiums paid by the
    Company under the Companys long term disability policy on
    behalf of the Named Executive Officers.                         
|   
|(3) | Mr. Chan was President of the Company from
    its inception through April 2001 and was its Chief Executive
    Officer from its inception through August 28, 2001.              
|   
|(4) | Mr. Pietri joined the Company as President
    on April 30, 2001 and became Chief Executive Officer on
    August 29, 2001.                                                      
|   
|(5) | Includes $75,000 earned in 2002 that was
    deferred, at Mr. Pietris election, to 2003.                                                                                        
|   
|(6) | Mr. Scharninghausen joined the Company as
    Chief Financial Officer on October 16, 2002                                                                                        

Option Grants in Last Fiscal Year

|                              |  |                   |           |               |  |          |    |                            |  |                            |      |     |  |  |        |  |  |   |           |  |  |   |           | 
|----------------------------- |  | ----------------- | --------- | ------------- |  | -------- | -- | -------------------------- |  | -------------------------- | ---- | --- |  |  | ------ |  |  | - | --------- |  |  | - | --------- | 
|                              |  |                   |           |               |  |          |    |                            |  |                           
|                              |  | Individual Grants |           |               |  |          |    |                           
|                              |  |                   |           |               |  |          |    | Potential Realizable Value
|                              |  | Number of         |           | Percent of    |  |          |    |                            |  | at Assumed Annual Rates of
|                              |  | Securities        |           | Total Options |  |          |    |                            |  | Stock Price Appreciation  
|                              |  | Underlying        |           | Granted to    |  |          |    |                            |  | for Option Term           
|                              |  | Options           |           | Employees in  |  | Exercise |    | Expiration                 |  |                           
|Name                          |  | Granted           |           | Fiscal Year   |  | Price    |    | Date                       |  | 5%                         |      | 10%
|                              |  |                   |           |               |  |          |    |                            |  |                            |      |    
|Fred S. L. Chan               |  |                   |          |               |  |          | 0  | %                          |  |                            |     |     |  |  |       |  |  |   |          |  |  |   |          | 
|Didier Pietri(1)              |  |                   | 2,000,000 |               |  |          | 83 | %                          |  | $                          | 0.34 |     |  |  | 6/5/13 |  |  | $ | 1,230,800 |  |  | $ | 1,564,000 | 
|William M. Scharninghausen(1) |  |                   | 15,000    |               |  |          | 1  | %                          |  |                            | 0.50 |     |  |  | 7/1/13 |  |  |   | 13,575    |  |  |   | 17,250    | 



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|    |                                                                                                                                              
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Options vest at a rate of 25% on each of the one
    and two year anniversary of grant and 1/48 on each one month
    anniversary thereafter.

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Aggregate Options Exercises in Last Fiscal
Year and

Fiscal Year-End Values


The following table sets forth certain
information concerning the exercise of options by each of the
Named Executive Officers during fiscal year 2003, including the
aggregate amount of gains on the date of exercise. In addition,
the table includes the number of shares covered by both
exercisable and unexercisable stock options as of
December 31, 2003.

|                           |  |             |   |          |  |                        |   |                      |  |             |           |               |  |  |           |  |  |   |         |  |  |   |         | 
|-------------------------- |  | ----------- | - | -------- |  | ---------------------- | - | -------------------- |  | ----------- | --------- | ------------- |  |  | --------- |  |  | - | ------- |  |  | - | ------- | 
|                           |  |             |   |          |  |                        |   |                     
|                           |  |             |   |          |  | Number of Securities   |   | Value of Unexercised
|                           |  |             |   |          |  | Underlying Unexercised |   | In-The-Money        
|                           |  |             |   |          |  | Options at             |   | Options at          
|                           |  | Shares      |   |          |  | Fiscal Year End        |   | Fiscal Year-End(1)  
|                           |  | Acquired on |   | Value    |  |                        |   |                     
|Name                       |  | Exercise    |   | Realized |  | Exercisable            |   | Unexercisable        |  | Exercisable |           | Unexercisable
|                           |  |             |   |          |  |                        |   |                      |  |             |           |              
|Fred S. L. Chan            |  |             | 0 |          |  | $                      | 0 |                      |  |             | 515,155   |               |  |  | 1,182,225 |  |  | $ | 278,184 |  |  | $ | 363,402 | 
|Didier Pietri              |  |             | 0 |          |  | $                      | 0 |                      |  |             | 1,750,000 |               |  |  | 2,250,000 |  |  |   | 170,000 |  |  |   | 350,000 | 
|William M. Scharninghausen |  |             | 0 |          |  | $                      | 0 |                      |  |             | 62,500    |               |  |  | 202,500   |  |  |   | 2,500   |  |  |   | 10,650  | 



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|    |                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Valuation of these options is based on the
    closing bid price of $0.54 per share, as quoted on the over
    the counter bulletin board on December 31, 2003.

COMPENSATION OF DIRECTORS

During 2003, non-employee directors of the
Company received cash compensation for their services, along
with reimbursement for their reasonable expenses in attending
meetings of the Board of Directors or any meetings of a
Committee of the Board of Directors. Commencing with the first
quarter of 2003, each non-employee director received the
following fees:



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | $2,000 for each Board meeting attended in person;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | $1,000 for each Board meeting attended by
    telephone;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | $8,000 per year for service on the Audit
    Committee or $12,000 per year for service as the Chairman
    of the Audit Committee, in each case payable in four quarterly
    installments; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | an annual stock grant of 20,000 shares under
    our 2000 Directors Stock Option Plan, as amended on
    April 30, 2003. Prior to its amendment, the
    2000 Directors Stock Option Plan provided for an initial
    grant of 32,000 shares and subsequent grants of
    8,000 shares each year for services as a director. All
    options are granted at an exercise price equal to the fair
    market value of a share of Common Stock on the date of grant and
    vest in four equal annual installments, starting on the first
    anniversary of the date of grant. For a more detailed
    description of the Directors Plan, including the amendment, see
    Exhibit 10.2 of the Companys 2003 Form 10-K for
    the 2003 fiscal year filed with the SEC.

Up until January 2003, Mr. Fong served as an
advisor to the Chairman of the Board and received $8,025 in 2003
as compensation for advisory services provided to the Company.
Subsequent to January 2003, Mr. Fong, as a non-employee
director, received $20,000 for Board and committee meetings
attended in 2003. Mr. Cain received $8,000; Mr. Chang
received $10,000, and Mr. Dubester received $13,000 for
Board and committee meetings attended in 2003.

Directors who are employees of the Company do not
receive additional compensation for their services as directors.
During fiscal 2003, Mr. Chan and Mr. Pietri were the
only employees who served as directors.

COMPENSATION COMMITTEE INTERLOCKS

AND INSIDER PARTICIPATION


Fred Chan, who is the Chairman of the Company,
participated in deliberations of the Companys Board of
Directors concerning executive officer compensation.

6



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##### Table of Contents



Vialta employs Fred S.L. Chans brother as
its Senior Director of IT and one of his sons as its Director of
Product Marketing and Design. The salary and benefits provided
to these individuals for fiscal 2003 was $107,194 and $91,528,
respectively. Another of Mr. Chans sons is employed
as a Marketing Coordinator and received salary and benefits
during the last fiscal year that did not exceed $60,000.

No Compensation committee interlocks existed
during 2003.

REPORT OF THE COMPENSATION COMMITTEE ON
EXECUTIVE COMPENSATION

General

The Committee acts on behalf of the Board to
examine and implement the general compensation policy of the
Company for all executive officers and such other employees of
the Company as the Board of Directors may deem appropriate. The
Committee reviews the general compensation policy applicable to
the Chief Executive Officer (CEO) and other
executive officers on an annual basis. The Committee administers
the Companys incentive and equity plans, including the
1999 Stock Incentive Plan, the 2000 Directors Stock Option
Plan and the 2001 Nonstatutory Stock Option Plan.

The Companys policy in compensating its
executive officers is intended to attract, motivate and retain
these executives. Consistent with this policy, key executives
are eligible to receive, in addition to their base salaries,
stock option grants under the 1999 Stock Incentive Plan in
amounts determined by the Board of Directors based on
recommendations by the Compensation Committee. Stock options
have value for these executives only if the price of the
Companys stock increases above the fair market value on
the grant date and the executive remains in the Companys
employ for the period required for the shares to vest.
Additional incentive compensation is also considered by the
Committee based on individual performance and the achievement of
short term goals.

The base salary, incentive compensation and stock
option grants of the executive officers are determined in part
by the Committee reviewing data on prevailing compensation
practices in technology companies with whom the Company competes
for executive talent and by their evaluating such information in
connection with the Companys corporate goals. To this end,
the Committee attempts to compare the compensation of the
Companys CEO and other executive officers with the
compensation practices of comparable companies to determine base
salary, target bonuses and target total cash compensation.

Compensation of Executive Officers

During the fiscal year that ended on
December 31, 2003, the Companys executive
compensation program was comprised of the following key
components: base salary, annual bonus, and equity-based
incentives.

Base Salary.The
Company sets the base salaries of its executives at levels
believed to be consistent with comparably sized companies
engaged in similar industries.

Equity-Based Incentive
Compensation.Stock options are an
important component of the total compensation of executives. The
Company believes that stock options align the interests of each
executive with those of the stockholders. They also provide
executives a significant, long-term interest in the
Companys success and help retain key executives in a
competitive market for executive talent. The Companys 1999
Equity Incentive Plan authorizes the Committee to grant stock
options to executives. The number of shares owned by, or subject
to options held by, each executive officer is periodically
reviewed and additional awards are considered based upon past
performance of the executive and the relative holdings of other
executives in the Company. The option grants generally utilize
four-year vesting periods to encourage executives to continue
contributing to the Company, and they expire not later than ten
years from the date of grant.

7



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##### Table of Contents



Compensation of the Chief Executive
Officer

The Companys CEOs compensation plans
include the same elements and performance measures as the plans
of the Companys other executive officers. The Compensation
Committee evaluates the performance of the Companys CEO,
sets his base compensation and determines bonuses and awards
stock or option grants, if any. In May 2003 the Compensation
Committee approved continuing Mr. Pietris basic
compensation at the rate he has been paid since joining the
Company in April of 2001. In addition, the Compensation
Committee voted to provide a guaranteed bonus of $75,000, which
was paid in November 2003. A discretionary bonus of $75,000 has
not yet been paid as of the date of this proxy statement filing.
The Compensation Committee also approved a stock option grant to
Mr. Pietri of 2,000,000 shares of common stock to vest
25% immediately, 25% on the first anniversary of the grant and
2 1/2% each month thereafter. In determining the terms of
his agreement, the Compensation Committee considered a number of
factors and criteria including, Mr. Pietris depth of
experience, his past accomplishments with other companies, his
vision and leadership abilities, and the future needs of the
Company. In making its compensation decisions with
Mr. Pietri, the Compensation Committee also considered the
need to provide continuity of leadership. The Compensation
Committee exercised its discretion and judgment based on the
above factors, and no specific formula was applied to determine
the weight of any factor.

Deductibility of Executive
Compensation

The Compensation Committee has considered the
impact of Section 162(m) of the Code, which disallows a
deduction for any publicly held corporation for individual
compensation exceeding $1 million in any taxable year for
the CEO and four other most highly compensated executive
officers, unless such compensation meets the requirements for
the performance-based exception to the general rule.
Since the cash compensation paid by the Company to each of its
executive officers is expected to be below $1 million, the
Compensation Committee believes that this section will not
affect the tax deductions available to the Company. It will be
the Compensation Committees policy to qualify, to the
extent reasonable, the executive officers compensation for
deductibility under applicable tax law.



| |                       
| | ----------------------
| | COMPENSATION COMMITTEE
|
| | Matt Fong (Chairman)  
| | George Cain           
| | Michael Dubester      

EMPLOYMENT AGREEMENTS

Didier Pietri originally entered into an
employment letter agreement on April 2001, with the Company
pursuant to which he was entitled to receive an annual salary of
$300,000. In addition to basic compensation, Mr. Pietri was
entitled to participation in employee benefit plans, stock
option grants and a guaranteed bonus of $100,000 after one year
of service. Mr. Pietri was also awarded an additional
$150,000 bonus, which was paid in 2003. In April 2002, the
Compensation Committee approved continuing
Mr. Pietris basic compensation at the previous rate,
but the guaranteed bonus for his second year of service was
reduced to $75,000, and a discretionary bonus of $75,000 was
added. Any discretionary bonus must be paid before the
expiration of the agreement. In May, 2003, the Compensation
Committee again approved continuing Mr. Pietris base
salary and retaining his guaranteed and discretionary bonuses.
In addition, the compensation committee approved a stock option
grant to Mr. Pietri of 2,000,000 shares of common
stock to vest 25% immediately, 25% on the first anniversary of
the grant and 2 1/2% each month thereafter.

8



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##### Table of Contents



PERFORMANCE GRAPH

The graph below compares the cumulative total
stockholder return on the Common Stock of the Company from the
first day of trading of the Companys Common Stock after
the Companys spin-off from ESS Technology, Inc.
(August 21, 2001) to December 31, 2003 with the
cumulative total return on the NASDAQ Stock Market Index and the
Dow Jones Consumer Electronics Industry Index (assuming the
investment of $100 in the Companys Common Stock and in
each of the indexes on the date of the Companys initial
public offering, and reinvestment of all dividends). The stock
price performance on the following graph is not necessarily
indicative of future stock price performance.

Stock Price Performance

August 23 (Inception), 2001 
December 31, 2003


(STOCK PRICE PERFORMANCE GRAPH)

The following description data are supplied in
accordance with Rule 304(d) of Regulation S-T:

|         |  |                  |        |                  |  |                   |        |  |  |   |        | 
|-------- |  | ---------------- | ------ | ---------------- |  | ----------------- | ------ |  |  | - | ------ | 
|         |  |                  |        |                  |  | Dow Jones        
|         |  |                  |        | NASDAQ           |  | Consumer         
|         |  | Vialta, Inc.     |        | Composite        |  | Electronics Index
|         |  |                  |        |                  |  |                  
|Date     |  | Investment Value |        | Investment Value |  | Investment Value 
|         |  |                  |        |                  |  |                  
|8/23/01  |  | $                | 100.00 |                  |  | $                 | 100.00 |  |  | $ | 100.00 | 
|12/31/01 |  | $                | 263.83 |                  |  | $                 | 81.94  |  |  | $ | 112.05 | 
|12/31/02 |  | $                | 64.89  |                  |  | $                 | 75.35  |  |  | $ | 138.89 | 
|12/31/03 |  | $                | 114.89 |                  |  | $                 | 106.18 |  |  | $ | 345.82 | 

9



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##### Table of Contents








|         |                                                                   
|-------- | ------------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial
    Owners and Management

Equity Compensation Plan Information

The following table summarizes information with
respect to options under our equity compensation plans at
December 31, 2003:

|                                                               |  |                      |            |                   |  |                             |      |  |  |  |           | 
|-------------------------------------------------------------- |  | -------------------- | ---------- | ----------------- |  | --------------------------- | ---- |  |  |  | --------- | 
|                                                               |  | Number of            |            | Weighted Average  |  | Number of Securities       
|                                                               |  | Securities to be     |            | Exercise Price of |  | Remaining Available for    
|                                                               |  | Issued Upon Exercise |            | Outstanding       |  | Future Issuance Under      
|                                                               |  | of Outstanding       |            | Options,          |  | Equity Compensation        
|                                                               |  | Options, Warrants    |            | Warrants          |  | Plans (Excluding Securities
|                                                               |  | and Rights (1)       |            | and Rights        |  | Reflected in Column (a))   
|                                                               |  | (a)                  |            | (b)               |  | (c)                        
|                                                               |  |                      |            |                   |  |                            
|Equity compensation plans approved by security
    holders     |  |                      | 12,148,744 |                   |  | $                           | 0.31 |  |  |  | 4,518,490 | 
|Equity compensation plans not approved by
    security holders |  |                      |           |                   |  |                             |     |  |  |  |          | 
|                                                               |  |                      |            |                   |  |                             |      |  |  |  |           | 
|                                                               |  |                      | 12,148,744 |                   |  | $                           | 0.31 |  |  |  | 4,518,490 | 
|                                                               |  |                      |            |                   |  |                             |      |  |  |  |           | 

Security Ownership of Certain Beneficial
Owners and Management

The following table sets forth certain
information, as of March 31, 2004, known to the Company
regarding the beneficial ownership of the Companys Common
Stock by (i) each person known by the Company to be the
beneficial owner of more than 5% of the Companys Common
Stock, (ii) each of the Companys directors,
(iii) each executive officer named in the Summary
Compensation Table below (the Named Executive
Officers) and (iv) all directors and executive
officers as a group. Unless otherwise indicated in the footnotes
hereto, each director and executive officer has (or could have
upon exercise of an option vested or vesting within 60 days
of March 31, 2004) sole vesting and investment power,
subject to community property laws where applicable.

|                                                                |                                  |                    |            |         |  |  |    |   | 
|--------------------------------------------------------------- | -------------------------------- | ------------------ | ---------- | ------- |  |  | -- | - | 
|                                                                |                                  |                   
|                                                                |                                  | Common Stock      
|                                                                |                                  | Beneficially Owned
|                                                                |                                  |                   
|Name and Address of Beneficial Owners(1)                        |                                  | Number             |            | Percent
|                                                                |                                  |                    |            |        
|State of Wisconsin Investment Board(2)                          |                                  |                    | 7,892,600  |         |  |  | 10 | %
|                                                                | P.O. Box 7842, Madison, WI 53707 |                    |            |         |  |  |    |   | 
|Trusts for the Benefit of the children of Fred
    S.L. Chan(3) |                                  |                    | 11,083,757 |         |  |  | 13 | %
|Fred S.L. Chan(4)                                               |                                  |                    | 21,495,863 |         |  |  | 26 | %
|Didier Pietri(5)                                                |                                  |                    | 2,496,936  |         |  |  | 2  | %
|George M. Cain(6)                                               |                                  |                    | 5,000      |         |  |  | *  |  
|Herbert Chang(7)                                                |                                  |                    | 33,833     |         |  |  | *  |  
|Matthew K. Fong                                                 |                                  |                    | 80,974     |         |  |  | *  |  
|Michael S. Dubester(8)                                          |                                  |                    | 5,000      |         |  |  | *  |  
|William Scharninghausen(9)                                      |                                  |                    | 62,500     |         |  |  | *  |  
|All executive officers and directors as a group
    (7 persons) |                                  |                    | 24,180,106 |         |  |  | 29 | %



---



|  |                                                                          
|- | -------------------------------------------------------------------------
|* | Less than 1% of the outstanding shares of the
    Companys Common Stock.



|    |                                                                                                                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Unless otherwise indicated, the address for each
    beneficial owner is c/o Vialta, Inc., 48461 Fremont
    Boulevard, Fremont, CA 94538.                                                                                         
|   
|(2) | Based on a filing with the Securities Exchange
    Commission on February 16, 2004 indicating beneficial
    ownership as of December 31, 2003.                                                                                    
|   
|(3) | Includes shares held by trusts for the benefit of
    the children of Mr. and Mrs. Chan. Includes
    8,800,000 shares held by Evershine XVI, L.P., an entity
    controlled by a trust for the benefit of Mr. Chans
    children.

10



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##### Table of Contents





|    |                                                                                                                                                              
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|(4) | Includes 539,780 shares which Mr. Chan
    has the right to acquire on or within 60 days of
    March 31, 2004 through the exercise of options.              
|   
|(5) | Includes 2,437,500 shares which
    Mr. Pietri has the right to acquire on or within
    60 days of March 31, 2004 through the exercise of
    options.      
|   
|(6) | Includes 5,000 shares which Mr. Cain
    has the right to acquire on or within 60 days of
    March 31, 2004 through the exercise of options.                
|   
|(7) | Includes 33,833 shares which Mr. Chang
    has the right to acquire on or within 60 days of
    March 31, 2004 through the exercise of options.              
|   
|(8) | Includes 5,000 shares which
    Mr. Dubester has the right to acquire on or within
    60 days of March 31, 2004 through the exercise of
    options.        
|   
|(9) | Includes 62,500 shares which
    Mr. Scharninghausen has the right to acquire on or within
    60 days of March 31, 2004 through the exercise of
    options.






|         |                                                   
|-------- | --------------------------------------------------
|Item 13. | Certain Relationships and Related
    Transactions

Vialta employs Fred S.L. Chans brother as
its Senior Director of IT and one of his sons as its Director of
Product Marketing and Design. The salary and benefits provided
to these individuals for fiscal 2002 was $107,194 and $91,528,
respectively, and they also received the Companys standard
employee benefits package. Another of Mr. Chans sons
was employed as a Marketing Coordinator during a portion of
fiscal 2003 and received salary and benefits during the last
fiscal year that did not exceed $60,000.

Mr. Chan is Chairman of the Board of ESS
Technology, Inc., and owns approximately 14.1% of the
outstanding common stock of ESS. Prior to its spin-off in August
2001, Vialta was a subsidiary of ESS. Vialta leases its
corporate headquarters and purchases component parts from ESS.
The companies are also parties to an Administrative and
Management Services Agreement. During 2003, Vialta made payments
to ESS of $1,182,000 under the lease, $194,000 for component
parts, $10,000 for administrative and management services,
$33,000 for services received in fiscal 2002, and received
payments from ESS of $4,000 for other services. Effective as of
July 2003, Vialta renegotiated its lease with ESS Technology to
extend the duration of the lease at fair market rate. Vialta
believes it paid fair market value for the lease based on a
review of lease rental rates in its area and believes the prices
it was charged for parts is equivalent to those charged by ESS
to other manufactures.






|         |                                           
|-------- | ------------------------------------------
|Item 14. | Principal Accountant Fees and
    Services

Fees Paid to PricewaterhouseCoopers
LLP

The following table lists the aggregate fees paid
for professional services by PricewaterhouseCoopers LLP for all
Audit Fees, Audit-Related Fees,
Tax Fees, and All Other Fees for the
last two fiscal years. Certain amounts for the fiscal year 2002
have been reclassified to conform to the 2003 presentation.

|                   |  |             |         |             |  |   |         | 
|------------------ |  | ----------- | ------- | ----------- |  | - | ------- | 
|                   |  | Fiscal 2003 |         | Fiscal 2002
|                   |  |             |         |            
|Audit Fees         |  | $           | 208,000 |             |  | $ | 227,000 | 
|Audit Related Fees |  |             | 0       |             |  |   | 0       | 
|Tax Fees           |  |             | 40,900  |             |  |   | 60,000  | 
|All Other Fees     |  |             | 0       |             |  |   | 0       | 
|                   |  |             |         |             |  |   |         | 
|                   |  | $           | 248,900 |             |  | $ | 287,000 | 
|                   |  |             |         |             |  |   |         | 

The Audit fees for the years ended
December 31, 2003 and 2002, respectively, were for services
rendered for the audit of the Companys annual financial
statements for the fiscal years 2003 and 2002, and for reviews
of the financial statements included in the Companys
quarterly reports on Form 10-Q for the first three quarters
of the fiscal years 2003 and 2002. Tax fees for the years ended
December 31, 2003 and 2002, respectively, were for tax
compliance, tax advice and tax preparation.

11



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##### Table of Contents



Policy of Audit Committee with respect to
Independent Auditors

The Audit Committee of the Board pre-approved all
non-audit services provided by PricewaterhouseCoopers LLP and
concluded, based on information provided by
PricewaterhouseCoopers LLP, that providing such services is
compatible with maintaining PricewaterhouseCoopers LLPs
independence.

The Companys management has the primary
responsibility for the integrity of the Companys financial
information. The Companys independent accountants are
responsible for conducting independent audits of the
Companys financial statements in accordance with generally
accepted auditing standards and expressing an opinion on the
financial statements based on those audits. The Audit Committee
nominates the independent accountants for approval by the Board
and is responsible for overseeing the conduct of the above
activities by management and such accountants.

As part of its responsibility, the Audit
Committee has met with the Companys independent
accountants to review and discuss the adequacy of the
Companys internal control system, financial reporting
procedures and other matters required to be discussed by the
Statement of Auditor Standards 61 such as the independent
accountants judgments as to the quality of the financial
statements, changes in the accounting policies and sensitive
accounting estimates. The Audit Committee has reviewed and
discussed the audited financial statements with management and
the Companys independent accountants. The Audit Committee
preapproved the general scope of the Companys annual audit
and performance of non-audit services by the Companys
accountants and reviewed the fees charged by the independent
accountants. The Audit Committee has received the written
disclosures and the letter from the independent accountants
required by Independent Standards Board Standard No. 1 and
has discussed with the independent accountants that firms
independence.




PART IV






|         |                                                                     
|-------- | --------------------------------------------------------------------
|Item 15. | Exhibits, Financial Statement Schedules,
    and Reports on Form 8-K

(a)(3) Exhibits

The exhibit index below lists the exhibits that
are filed as a part of this amendment

|        |      |               |  |                                                                                                        
|------- | ---- | ------------- |  | -------------------------------------------------------------------------------------------------------
|Exhibit |      |              
|Number  |      | Exhibit Title
|        |      |              
|        | 31.1 |               |  | Certification of Chief Executive Officer Pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002.
|        | 31.2 |               |  | Certification of Chief Financial Officer Pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002.

12



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##### Table of Contents






SIGNATURE

Pursuant to the requirements of Section 13
or 15(d) of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized



| |             
| | ------------
| | VIALTA, INC.
| | (Registrant)



| |     |                  
| | --- | -----------------
| | By: | /s/ DIDIER PIETRI

| |                                          
| | -----------------------------------------
| |                                          
| | Didier Pietri                            
| | President and Chief Executive
    Officer

Dated: May 4, 2004

13



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##### Table of Contents



INDEX TO EXHIBITS

|        |      |               |  |                                                                                                        
|------- | ---- | ------------- |  | -------------------------------------------------------------------------------------------------------
|Exhibit |      |              
|Number  |      | Exhibit Title
|        |      |              
|        | 31.1 |               |  | Certification of Chief Executive Officer Pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002.
|        | 31.2 |               |  | Certification of Chief Financial Officer Pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002.

14