**Exhibit 10.26**Terayon Communication Systems, Inc.PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT       As an employee of Terayon Communication Systems, Inc., a Delaware corporation, and/or any ofits subsidiaries or affiliates (together, the “Company”), and as a condition of my employment bythe Company and in consideration of the compensation now and hereafter paid to me, I agree to thefollowing:1. Maintaining Confidential Information. (a) Company Information. I agree at all times during the term of myemployment and thereafter to hold in strictest confidence, and not to use, except forthe benefit of the Company, or to disclose to any person, firm or corporation, withoutthe written authorization of the Board of Directors of the Company, any trade secrets,confidential knowledge or data, proprietary materials, or other proprietaryinformation of the Company. By way of illustration and not limitation, suchproprietary materials and information shall include proprietary and/or confidentialmaterials and information relating to software, test data, protocols, assaycomponents, procedures and formulations, products, processes, know-how, designs,formulas, methods, developmental or experimental work, improvements, discoveries,plans for research, new products, marketing and selling, business plans, budgets andunpublished financial statements, licenses, prices and costs, suppliers and customers,and information regarding the skills and compensation of other employees of theCompany.  (b) Former Employer Information. I agree that I will not, during myemployment with the Company, improperly use or disclose any proprietary information ortrade secrets of my former or concurrent employers or companies, if any, and that Iwill not bring onto the premises of the Company any unpublished documents or propertybelonging to my former or concurrent employers or companies unless consented to inwriting by said employers or companies.  (c) Third Party Information. I recognize that the Company has receivedand in the future will receive from third parties their confidential or proprietaryinformation subject to a duty on the Company’s part to maintain the confidentiality ofsuch information and, in some cases, to use in only for certain limited purposes. Iagree that I owe the Company and such third parties, both during the term of myemployment and thereafter, a duty to hold all such confidential or proprietaryinformation in the strictest confidence and not to disclose it to any person, firm orcorporation (except in a manner that is consistent with the Company’s agreement withthe third party) or use it for the benefit of anyone other than the Company or suchthird party (consistent with the Company’s agreement with the third party.)2. Assignment of Inventions and Original Works. (a) Inventions and Original Works Retained by Me. I have attached heretoas Exhibit A a complete list of all inventions, original works or authorship,developments, improvements, and trade secrets, relating in any way to the Company’spresent or anticipated business, that I have, alone or jointly with others, conceived,developed or reduced to practice prior to the commencement of my employment with theCompany, that I consider to be my property or the property of third parties and that Iwish to have excluded from the scope of the Agreement. If disclosure of an item inExhibit A would cause me to violate any prior confidentiality agreement, I understandthat I am not to list such in Exhibit A but am to inform the Company that all itemshave not been listed for that reason. A space is provided on Exhibit A for suchpurposes. If no list is attached, I represent that there are no such items.
 

 
 (b) Inventions and Original Works Assigned to the Company. I agree thatI will make prompt written disclosure to the Company, will hold in trust for the soleright and benefit of the Company, and will assign to the Company all my right, titleand interest in and to any ideas, inventions, compositions of matter, original worksof authorship, developments, improvements or trade secrets which I solely or jointlyconceive or reduced to practice, during the period of my employment with the Company.I recognize that the Agreement does not require assignment of any invention whichqualifies fully for protection under Section 2870 of the California Labor Code(hereinafter “Section 2870”), which provides as follows: (1) Any provision in an employment agreementwhich provides that an employee shall assign, or offer to assign, anyof his or her rights in an invention to his or her employer shall notapply to an invention that the employee developed entirely on his orher own time without using the employer’s equipment, supplies,facilities, or trade secret information except for those inventionsthat either: (a) Relate at the time ofconception or reduction to practice of the invention to theemployer’s business, or actual or demonstrably anticipatedresearch or development of the employer;  (b) Result from any workperformed by the employee for the employer. (2) To the extent a provision in an employmentagreement proports to require an employee to assign an inventionotherwise excluded from being required to be assigned undersubdivision (a), the provision is against the public policy of thisstate and is unenforceable.     I acknowledge that all original works of authorship which are made by me (solely or jointlywith others) within the scope of my employment and which are protectable by copyright are “worksmade for hire,” as that term is defined by the United States Copyright Act (17 U.S.C., Section101). (a) Inventions and Original Works Assigned to the United States. I agreeto assign to the United States government all my right, title and interest in and toany and all inventions, original works of authorship, developments, improvements ortrade secrets whenever full title to same is required to be in the Untied States by acontract between the Company and the United States or any of its agencies.  (d) Obtaining Letters Patent, Copyright Registrations and OtherProtections. I will assist the Company in every proper way to obtain andenforce the United States and foreign proprietary rights relating to any and allinventions, original works or authorship, developments, improvements, or trade secretsof the Company in any and all countries. To that end I will execute, verify anddeliver such documents and perform such other acts (including appearing as a witness)the Company may reasonably request for use in applying for, obtaining, perfecting,evidencing, sustaining and enforcing such proprietary rights and the assignmentthereof. In addition, I will execute, verify and deliver assignments of suchproprietary rights to the Company or its designee. My obligation to assist thecompany with respect to proprietary rights in any and all countries shall continuebeyond the termination of my employment, but the Company shall compensate at areasonable rate after my termination for the time actually spent by me at theCompany’s request on such assistance.     In the event the Company is unable for any reason, after reasonable effort, to securemy signature on any document needed in connection with the actions specified in thepreceding paragraph, I hereby irrevocably designate and appoint the Company and its dulyauthorized
 

 
officers and agents as my agent and attorney in fact, to act for and in my behalf toexecute, verify and file any such documents and to do all other lawfully permitted acts tofurther the purposes of the preceding paragraph with the same legal force and effect as ifexecuted by me. I hereby waive and quitclaim to the Company and all claims of any naturewhatsoever which I now or may hereafter have for infringement of any and all proprietaryrights assigned to the Company.(e) Obligation to Keep the Company Informed. In addition to my obligationsunder paragraph 2(b) above, during the period of my employment and for one year aftertermination of my employment for any reason, I will promptly disclose to the Companyfully and in writing all patent applications filed by me on my behalf. At the time ofeach such disclosure, I will advise the Company in writing of any inventions that Ibelieve fully qualify for protection under Section2870; and I will at that time providethe Company in writing all evidence necessary to substantiate that belief. Iunderstand that the Company will keep in confidence and will not disclose to thirdparties without my consent any proprietary information disclosed in writing to theCompany pursuant to the Agreement relating to inventions that qualify for protectionunder Section 2870; will preserve the confidentiality of any invention that does notqualify for protection under Section 2870. I agree to keep and maintain adequate andcurrent records (in the form of notes, sketches, drawings and in any other form thatmay be required by the Company) of all proprietary information developed by me and allinventions made by me during the period of my employment at the Company, which recordsshall be available to and remain the sole property of the Company at all times. 3. No Conflicting Employment: No Inducement of Other Employees.     I agree that during the period of my employment by the Company I will not, without theCompany’s express written consent, engage in any other employment or business activitydirectly related to the business in which the Company is now involved or becomes involved,nor will I engage in any other activities which conflict with my obligations to theCompany. For the period of my employment by the Company and for one (1) years after thedate of termination of my employment by the Company, I will not induce any employee of thecompany to leave the employment of the company. 4. No Conflicting Obligations.     I represent that my performance of all terms of this Agreement and as an employee ofthe Company does not and will not breach any agreement to keep in confidence informationacquired by me in confidence or in trust prior to my employment by the company. I have notentered into, and I agree I will not enter into, any agreement either written or oral inconflict herewith. 5. Return of Company Documents and Materials.     When I leave the employ of the Company, I will deliver to the Company (and will notkeep in my possession, recreate or deliver to anyone else) any and all devices, records,data, notes, reports, proposals, lists, correspondence, specifications, drawings,blueprints, sketches, materials, equipment, software, test data, protocols, assaycomponents, or other property, together with all copies, thereof (in whatever mediumrecorded belonging to the Company, its successors or assigns. I further agree that anyproperty situated on the Company’s premises and owned by the Company, including disks andother storage media, filing cabinets or other work areas, is subject to inspection byCompany personnel at any time with or without notice. Prior to leaving, I will cooperatewith the Company in completing and signing the Company’s termination statement fortechnical and management personnel.
 

 
*I have been informed and acknowledge that the unauthorized taking of Company’s trade secrets* *(I)* *could result in civil liability under California Civil Code Section 3426, andthat, if willful, could result in an award for triple the amount of the Company’sdamages and attorney’s fees; and*  *(II)* *is a crime under California Penal Code Section **444(c)**, punishable byimprisonment for a time not exceeding a year, or by a fine not exceeding five thousanddollars ($5,000), or by both.*6. Notification of New Employer.     In the event that I leave the employ of the Company, I hereby consent to thenotification of my new employer of my rights and obligations under this Agreement.7. Legal and Equitable Remedies.     Because my services are personal and unique and because I may have access to andbecome acquainted with the proprietary information of the Company, the Company shall havethe right to enforce this Agreement and any of its provisions by injunction, specificperformance or other equitable relief, without bond, without prejudice to any other rightsand remedies that the Company may have for a breach of Agreement.8. General Provisions.(a) Not an Employment Contract. I agree and understand that nothing inthis Agreement shall confer any right with respect to continuation of employment bythe Company, nor shall it interfere in any way with my right or the company’s rightto terminate my employment at any time, with or without cause.(b) Governing Law; Consent to Personal Jurisdiction. This Agreement willbe governed by and constructed according to the laws of the State of California. Ihereby expressly consent to the personal jurisdiction of the state and federalcourts located in Santa Clara County, California for any lawsuit filed thereagainst me by the Company arising from or relating to this Agreement.(c) Entire Agreement. This Agreement sets forth the final, complete andexclusive agreement and understanding between the Company and me relating to thesubject matter hereof and merges all prior discussions between us. No modificationof or amendment to this Agreement, nor any waiver of any rights under thisAgreement, will be effective unless in writing and signed by both the Company andme. Any subsequent change or changes in my duties, salary or compensation will notaffect the validity or scope of this Agreement.(d) Severability. If one or more of the provisions in the Agreement aredeemed unenforceable by law, such provisions shall be deemed severed from theAgreement and the remaining provisions will continue in full force and effect.(e) Successors and Assigns. This Agreement will be binding upon heirs,executors, administrators and other legal representatives and will not be for thebenefit of the Company, its successors and its assigns.(f) Survival. The provisions of this Agreement shall survive thetermination or my employment and the assignment of this Agreement by the company toany successor in interest or other assignee.
 

 
(g) Waiver. No waiver by the company of any breach of this Agreementshall be a waiver of any proceeding or succeeding breach. No waiver by the Companyof any right under this Agreement shall be construed as a waiver of any otherright. The company shall not be required to give notice to enforce strictadherence to all terms of this Agreement.This Agreement shall be effective as of the first day of my employment with the Company, which isJuly 25, 2005.I UNDERSTAND THAT THIS AGREEMENT AFFECTS MY RIGHTS TO INVENTIONS I MAKE DURING MY EMPLOYMENT, ANDRESTRICTS MY RIGHT TO DISCLOSE OR USE THE COMPANY’S PROPRIETARY INFORMATION DURING OR SUBSEQUENT TOMY EMPLOYMENT.I HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS. I HAVE COMPLETELY FILLED OUTEXHIBIT A TO THIS AGREEMENT.   Dated: July 27, 2005. /s/ Matthew J. Aden     Signature   ACCEPTED AND AGREED TO: Matthew J. Aden     Name of Employee   Terayon Communication Systems, Inc.   By: /s/ Mark Richman     
 

 
EXHIBIT ATerayon Communication Systems, Inc.