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                                                                    EXHIBIT 4.35

December 28, 1999

Pascal Spothelfer
3570 Mathers Avenue
West Vancouver, B.C.
V7V 2L1

Dear Pascal

RE:   OFFER AND TERMS OF EMPLOYMENT

Position/Start Date/Salary

This letter is an offer of a full-time, permanent position as President and CEO,
with Spectrum Signal Processing Inc. ("Spectrum"). Your employment with Spectrum
will start January 1st, 2000. Compensation will be reviewed annually by the
compensation committee of the Board of Directors. Your base salary for the year
2000 will be $250,000. In addition to base salary you will be entitled to a
bonus according to an annual executive incentive plan which is open to all
executives, based on achievement of personal and corporate objectives developed
and reviewed annually in consultation with the compensation committee. For the
year 2000 the target bonus will be $125,000. The parameters of the bonus will be
set in January, when all the executive bonuses are set.

Benefits

Your coverage under the company benefits plan will begin as soon as possible.
This plan includes:

      -     Extended Medical Coverage, Including Eye Care

      -     Basic, Restorative and Orthodontic Dental Care

      -     Short and Long Term Disability Insurance

      -     Life and Accident Insurance

Retirement

We match up to 5% of your base salary into a mutually agreeable retirement
benefit plan.

Stock Options

We will grant you 400,000 options. The exercise price will be set at the closing
market price on the Toronto Stock Exchange for the last trading day of December,
1999. This is in accordance with the regulations of the Toronto Stock Exchange.
Your stock options will begin vesting from the date granted. They will vest in
1/5 annual allotments on the anniversary of your start date for five years
providing you are still employed by Spectrum. The stock options will be for a
ten (10) year term.

THE FOLLOWING SHOULD BE READ CAREFULLY AS IT IS YOUR CONTRACT OF EMPLOYMENT WITH
SPECTRUM. EACH PARAGRAPH OF THIS AGREEMENT IS TO BE ENFORCED INDEPENDENTLY OF
ANY OTHER.

    Vacation

1.0  Full-time Spectrum employees are entitled to 3 weeks (or 15 working days of
     vacation for the first seven years of employment, and 4 weeks afterwards.
     Vacation time may be carried forward a maximum period of one year, after
     which time unutilized time must be taken off. Except in

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     extraordinary circumstances and at the sole discretion of Spectrum, money
     shall not be paid in substitution of vacation time.

     Assignment of Rights and Non-Disclosure

2.0  Since Spectrum deals with proprietary and confidential information, as a
     condition of your employment you are required to sign our standard
     Assignment of Rights and Non-Disclosure Agreement (enclosed).

     Documentation

3.0  Any future change in your conditions of employment at Spectrum must be
     documented in writing and are not official or binding until this document
     is properly authorized by the Chair of the Board of Directors. Changes in
     conditions of employment which alter the terms of this Agreement will be
     documented in writing. Unless specifically changed in writing, each
     individual term of this agreement is binding for the full term of an
     employee's tenure at Spectrum.

     Termination

4.0  By signing this Agreement, you agree that any one of the following actions
     on your part constitutes just cause of dismissal, enabling Spectrum to
     terminate your employment immediately without further notice to you:

      4.1   serious conflict of interest, such as appropriating a Spectrum
            business opportunity to your own benefit (if such opportunity has
            not been previously rejected by Spectrum);

      4.2   theft from Spectrum or any of its employees;

      4.3   breach of Assignment of Rights and Non-Disclosure; or

      4.4   serious misrepresentation of your credentials.

     Notice - Spectrum

5.0  If, for any reason other than just cause, Spectrum must terminate our
     association, the notice period is as follows:

                  6 months if you are terminated in the first year

                  9 months if you are terminated in the second year

                  After the end of the second year, 12 months notice up to ten
                  years' service; and 6 weeks per year of additional service
                  beyond ten, to a maximum of 24 months.

                  Payment in lieu of notice will include the following:

                    Base salary, paid month-to-month;

                    The average of the annual non-discretionary bonuses paid to
                    the executive for the three full fiscal years ended prior to
                    the date of termination, such amount to be divided into 12
                    equal amounts and paid month-to-month in addition to base
                    salary;

                    Vacation pay; paid within 5 days of notice of termination;

                    Non-discretionary bonuses and incentive compensation related
                    to the current fiscal year in which termination occurs: you
                    will be entitled to the pro rata portion of such bonus based
                    upon the number of whole months you were employed out of the
                    total 12 months in that fiscal year. Such bonus will be paid
                    within 60 days of the end of the fiscal year in which the
                    executive was terminated; e.g. if you are terminated April
                    30 and the total bonus earned for that year turns out to be
                    $48K, you will be paid 1/3 of $48K or $16K at the end of the
                    following February.

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All stock options which have vested at the date of termination will expire on
the earlier of their expiry date and 90 days after the date notice is given to
the executive.

In cases where Spectrum has chosen payment in lieu of working notice, monies
will be paid out on a month-to-month basis, except for vacation and current
fiscal year bonus pay as outlined above. You will have an obligation to mitigate
your loss as a result of termination by finding alternate employment. Upon
successful location of replacement employment, Spectrum will pay as a lump sum,
50% of the then remaining balance of the base salary and average annual
non-discretionary bonus.

Notice - Employee

6.0  Should you choose to leave Spectrum, you will provide a minimum of four
     weeks notice, none of which may contain vacation days. Spectrum reserves
     the right to reduce the notice period. Employment time spent on leave or
     disability will not count into the calculation.

This offer letter is to be read in conjunction with the Change In Control
agreement between Mr. Spothelfer and Spectrum, dated December 28, 1999.

If you have any questions concerning this document, I would be pleased to
discuss them with you. In general, the terms and conditions above are intended
to make our employment relationship clear and to ensure fair treatment for all
employees.

Yours truly,

SPECTRUM SIGNAL PROCESSING INC.

         /s/ Ken Spencer

Per:     Ken Spencer,
         Chair of the Board

In order to indicate your formal acceptance of this offer and the terms of
employment as outlined herein, please return the original document bearing your
signature in the space provided below.

                                                     /s/ Pascal Spothelfer
                                                     ---------------------
                                                     Pascal Spothelfer

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THIS AGREEMENT made the 28th day of December 1999.

BETWEEN:

            SPECTRUM SIGNAL PROCESSING INC., a corporation incorporated pursuant
            to the laws of the Province of British Columbia and having an
            address at One Spectrum Court, #200 - 2700 Production Way, Burnaby,
            British Columbia

                  (herein called "Company")

                                                               OF THE FIRST PART

AND:

            PASCAL SPOTHELFER, a businessman having an address at 3570 Mathers
            Avenue, West Vancouver, B.C. V7V 2L1

            (herein called "Employee")

                                                              OF THE SECOND PART

WHEREAS:

A.          The Employee is employed by the Company under a letter of employment
(hereafter the "Employment Contract");

B.          The Company and the Employee are desirous of having certain rights
 and benefits in the event that the Employee's employment with the Company is
terminated in a manner set forth hereinafter;

C.          The Company wishes to retain the benefit of the Employee's services
and to ensure that the Employee is able to carry out his responsibilities with
the Company free from any distractions associated with any potential change in
the ownership or control of the Company or its assets;

D.    In consideration of the rights and benefits conferred on the Employee by
this Agreement, the Employee has agreed to provide certain restrictive covenants
in favour of the Company;

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                                       -2-

NOW THEREFORE in consideration of the premises and the mutual covenants and
agreements hereinafter contained, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged by each of the
Employee and the Company, it is agreed by and between the Employee and the
Company as follows:

1.          DEFINITIONS AND INTERPRETATION

1.1         Definitions

            In this Agreement, the following words and terms with the initial
letter or letters thereof capitalized shall have the meanings set forth below:

      (a)   "Accrued Compensation" means an amount equal to amounts earned or
            accrued up to and including the date on which the Employee's
            employment is terminated but not paid as of that date, including (i)
            base salary, (ii) vacation pay, and (iii) non-discretionary bonuses
            and incentive compensation;

      (b)   "Agreement" means this agreement as amended from time to time;

      (c)   "Average Bonus" means the average of the annual non-discretionary
            bonuses paid to the Employee during the three full fiscal years
            ended prior to the termination of the employment of the Employee as
            provided hereunder;

      (d)   "Change in Control" means a transaction or series of transactions
            whereby directly or indirectly:

            (i)   any person or combination of persons acting in concert
                  acquires a sufficient number of securities of the Company to
                  affect the control of the Company, whether by way of
                  acquisition of previously issued securities or as a result of
                  issuances from treasury, or a combination thereof, and for the
                  purposes of this Agreement, a person or combination of persons
                  acting in concert holding shares or other securities in excess
                  of the number which,

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                                      -3-

                  directly or following the conversion or exercise thereof,
                  would entitle the holders thereof to cast more than 40% of the
                  votes attached to all shares of the Company which may be cast
                  to elect directors of the Company, shall be deemed to be in a
                  position to affect the control of the Company;

            (ii)  the Company shall consolidate or merge with or into,
                  amalgamate with, or enter into a statutory arrangement with
                  any other person, or any other person shall consolidate or
                  merge with or into, or amalgamate with or enter into a
                  statutory arrangement with the Company, and, in connection
                  therewith, all or part of the outstanding shares of the
                  Company which have voting rights attached thereto shall be
                  changed in any way, reclassified or converted into, exchanged
                  or otherwise acquired for shares or other securities of the
                  Company or any other person or for cash or any other property
                  (other than a transaction which has been approved by the
                  directors of the Company, a majority of whom are directors of
                  the Company holding office at the date of this Agreement); or

            (iii) the Company shall sell or otherwise transfer, including by way
                  of the grant of a leasehold interest (or one or more
                  subsidiaries of the Company shall sell or otherwise transfer,
                  including by way of the grant of a leasehold interest)
                  property or assets (A) aggregating more than 50% of the
                  consolidated assets (measured by either book value or fair
                  market value) of the Company and its subsidiaries as at the
                  end of the most recently completed financial year of the
                  Company or (B) which during the most recently completed
                  financial year of the Company generated, or during the then
                  current financial year of the Company are expected to
                  generate, more than 50% of the consolidated revenue or cash
                  flow of the Company and its subsidiaries, to any other person
                  or persons (other than the Company or one or more subsidiaries
                  of the Company); other than a transaction or series of
                  transactions which involves a sale of securities or assets of
                  the Company with which the Employee is involved as a purchaser
                  in any

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                                      -4-

                  manner, whether directly or indirectly, and whether by way of
                  participation in a corporation or partnership that is a
                  purchaser or by provision of debt, equity or
                  purchase-leaseback financing;

      (e)   "Company's Business" means the development and commercialization of
            signal processing boards, sub-systems, systems and related products
            and services;

      (f)   "Expiry Date" means the date which is 12 months after a Change in
            Control occurs;

      (g)   "Restricted Period" means the period of 18 months commencing upon
            the date of termination of the Employee's employment pursuant to
            Section 2.1 or Section 2.2;

      (h)   "Triggering Event" means any one of the following events which
            occurs following a Change of Control without the express agreement
            in writing of the Employee:

            (i)   an adverse change in any of the duties, powers, rights,
                  discretion, working conditions or compensation of the Employee
                  as they exist immediately prior to the Change of Control which
                  would constitute constructive dismissal at law; or

            (ii)  a change in the location of the Employee's place of employment
                  by more than 80 kilometres.

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                                      -5-

1.2        Plural and Gender

            Whenever used in this Agreement, words importing the singular number
only shall include the plural and vice versa and words importing the masculine
gender shall include the feminine gender.

1.3         Binding Effect

            This Agreement shall be binding on the successors and assigns of the
Company and shall enure to the benefit of the heirs, executors, personal
representatives and permitted assigns of the Employee.

2.          RIGHTS OF EMPLOYEE

2.1         Right Upon Occurrence of Triggering Event

      (a)   Right: If a Change in Control occurs and if, in respect of the
            Employee, a Triggering Event occurs on or before the Expiry Date,
            the Employee shall be entitled, on at least 30 days written notice
            to the Company given within six months after the Triggering Event,
            to elect to terminate his employment with the Company and to receive
            from the Company in lieu of any amount he would have been entitled
            to receive on the termination of his employment pursuant to the
            provisions of the Employment Contract:

           (i)   all Accrued Compensation;

           (ii)  a sum equivalent to one and one-half (1.5) times the base
                 salary of the Employee for the period specified in the
                 Employment Contract upon Spectrum terminating the Employees
                 employment without cause;

           (iii) a sum equivalent to the Average Bonus multiplied by one and
                 one-half (1.5); and

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           (iv)  all stock options provided for in the Employment Contract or
                 otherwise allotted to the Employee, save and except that such
                 options, if not already vested, shall vest forthwith, and all
                 options shall expire upon the earlier of their expiry date and
                 120 days after the election to terminate by the Employee.

      (b)   Assistance: Should the Employee elect to terminate his employment
            with the Company as provided in Section 2.1(a), the Employee shall,
            at the request of the Company, provide the Company with all
            information and assistance relating to his or her employment with
            the Company as may be reasonably requested by the Company in order
            to transfer the Employee's duties and responsibilities to another
            employee.

2.2         Right Upon Termination

            The Employee shall be entitled to a payment from the Company in the
amount calculated in accordance with Section 2.1(a) hereof if his employment
with the Company is terminated by the Company within 12 months after a Change of
Control other than for cause.

2.3         Benefits

            If the Employee is entitled to a payment pursuant to Section 2.1 or
2.2 hereof, then regardless of the Employee's country of residence, the Company
shall also continue to pay the Employee's health insurance premiums and other
benefits as outlined in the Employment Contract and as permitted by the relevant
insurers for a period which is the lesser of eighteen months from termination or
until the Employee has otherwise secured comparable benefits.

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                                      -7-

3.          PAYMENTS AND REVIEW

3.1         Payments under this Agreement

            Subject to any arrangements made pursuant to Section 5.3 hereof, any
payment to be made by the Company pursuant to the terms of this Agreement shall
be paid by the Company, less all statutory deductions, as follows:

      (a)   the amounts payable under Sections 2.1(a)(i) (excluding bonuses),
            2.1(a)(ii) and 2.1(a)(iii) within five business days of the last day
            of the Employee's employment by the Company;

      (b)   the bonus component of the Accrued Compensation payable under
            Section 2.1(a)(i) within sixty business days of the end of the
            current fiscal year of the Company.

Any such payment shall be calculated, in the case of Section 2.1, at the date of
giving notice pursuant to Section 2.1, and in the case of Section 2.2 hereof, at
the date of termination of the Employee's employment.

The Company covenants and agrees to assist the Employee to receive all payments
made under this Agreement in a tax effective manner so long as such assistance
is not adverse to the interests of the Company.

4.          RESTRICTIVE COVENANTS

4.1         Non-Competition

            During the term of employment, the Employee shall not directly or
indirectly carry on or be engaged in or be concerned with or interested in or
advise, lend money to, guarantee the debts or obligations of or permit his name
to be used by any person engaged in or concerned with or interested in any
business similar to or competitive with the Company's Business.

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                                      -8-

4.2         Post-employment Non-Competition

            During the period of 12 months commencing upon the date of
termination of the Employee's employment, whether the termination is pursuant to
Section 2.1 or Section 2.2 of this Agreement or termination is voluntary by
Employee of for cause by the Company, the Employee shall not directly or
indirectly carry on or be engaged in or be concerned with or interested in or
advise, lend money to, guarantee the debts or obligations of or permit his name
to be used by any person engaged in or concerned with or interested in any
business similar to and competitive with the Company's Business.

4.3         Non-Solicitation of Customers

            During the Restricted Period, the Employee shall not directly or
indirectly solicit or aid in the solicitation of any customers of the Company or
any prospective customers of the Company with whom the Employee had contact
during his employment.

4.4        Non-Solicitation of Employees

           During the Restricted Period, the Employee shall not directly or
indirectly solicit or aid in the solicitation for employment any person who is,
at the time of such solicitation, employed by the Company and the Employee shall
not directly or indirectly induce any person to leave his or her employment with
the Company.

4.5         Remedies

            The Employee acknowledges and agrees that any breach of this
Agreement could cause irreparable damage to the Company and that in the event of
a breach by the Employee, the Company shall have in addition to any and all
other remedies at law or in equity, the right to an injunction, specific
performance or other equitable relief to prevent any violation by the Employee
of any of the provisions of this Agreement including without limitation, the
provisions of Sections 4.1, 4.2, 4.3 and 4.4. In the event of any dispute under
any of Sections 4.1 to 4.4, the Employee agrees that the Company shall be
entitled, without showing actual damages, to a

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                                      -9-

temporary or permanent injunction restraining the conduct of the Employee
pending a determination of such dispute and that no bond or other security shall
be required from the Company in connection therewith.

5.         MISCELLANEOUS

5.1        Agreement Supplemental

           This Agreement shall be supplemental to the Employment Contract
except insofar as the Employment Contract relates to the termination of the
Employee's employment after a Change in Control, in which case this Agreement
shall supersede the termination provisions of the Employee Contract. To the
extent that the terms of the Employment Contract are not inconsistent with this
Agreement, such terms shall continue to apply, and the Employment Agreement is
hereby ratified and confirmed.

5.2         Assignment and Assumption

            This Agreement shall be assigned by the Company to any successor
corporation of the Company and shall be binding upon such successor corporation.
For the purposes of this Section 5.2, "successor corporation" shall include any
person referred to in paragraphs 1.1(d)(ii) or (iii) hereof. The Company shall
use its best efforts to ensure that the successor corporation shall continue the
provisions of this Agreement as if it were the original party in place of the
Company; provided however that the Company shall not thereby be relieved of any
obligation to the Employee pursuant to this Agreement.

5.3         Further Assurances

            Each of the Company and the Employee agrees to make, do and execute
or cause to be made, done and executed, all such further and other things, acts,
deeds, documents, assignments and assurances as may be necessary or reasonably
required to carry out the intent and purpose of this Agreement fully and
effectually. Without limiting the generality of the foregoing, the Company shall
take all reasonable steps in order to structure the payment or

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                                      -10-

payments provided for in this Agreement in the manner most advantageous to the
Employee with respect to the provisions of the Income Tax Act (Canada).

5.4         Notice

      (a)   Any notice required or permitted to be given under this Agreement
            will be in writing and may be given by delivering, sending by
            telecopier, or sending by prepaid registered mail the notice to the
            following address or telecopier number:

            If to the Company:

            Spectrum Signal Processing Inc.
            One Spectrum Court
            #200 - 2700 Production Way
            Burnaby, British Columbia  V5A 4X1

            Attention:  Chief Executive Officer and Chair of the Board of
                        Directors
            Telecopier No.: (604) 421-1764

            If to the Employee:

            as set out in the Employment Contract.

           (or to such other address or telecopier number as any party may
           specify by notice in writing to another party).

      (b)   Any notice delivered or sent by telecopier on a business day will be
            deemed conclusively to have been effectively given on the day the
            notice was delivered, or the telecopy transmission was sent
            successfully to the telecopier number set out above, as the case may
            be.

      (c)   Any notice sent by prepaid registered mail will be deemed
            conclusively to have been effectively given on the third business
            day after posting; but if at the time of posting or between the time
            of posting and the third business day thereafter there

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                                      -11-

            is a strike, lockout, or other labour disturbance affecting postal
            service, then the notice will not be effectively given until
            actually delivered.

5.5         Independent Legal Advice

            The Employee acknowledges having been advised to obtain independent
legal advice with respect to this Agreement.

5.6         Governing Law

            This Agreement shall be governed by and be construed in accordance
with the laws of British Columbia.

5.7         Severability

            Any provision of this Agreement which contravenes any applicable law
or which is found to be unenforceable shall, to the extent of such contravention
or unenforceability, be deemed severable and shall not cause this Agreement to
be held invalid or unenforceable or affect any other provision or provisions of
this Agreement.

IN WITNESS WHEREOF the parties hereto have caused this Agreement to be executed
as of the date first above written.

SPECTRUM SIGNAL PROCESSING INC.

By:  /s/ Kenneth Spencer
KENNETH SPENCER, CHAIR, BOARD OF DIRECTORS

By:  /s/ Pascal E. Spothelfer
PASCAL E. SPOTHELFER, PRESIDENT & CEO