Exhibit 10.7

                              EMPLOYMENT AGREEMENT

         This  Employment  Agreement  (the  "Agreement")  is made as of March 1,
2004, by and between Northgate  Innovations,  Inc., a Delaware  corporation (the
"Company"), and Theodore B. Muftic, a resident of London, England ("Employee").

         WHEREAS,  the Company  desires to obtain the services of Employee,  and
Employee  desires to provide  services to the Company,  in  accordance  with the
terms and conditions of this Agreement;

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency of which are hereby acknowledged,  the Company and Employee agree as
follows.

         1.  Employment.  Effective on the Effective Date (as defined in Section
2) and subject to the terms and conditions of this Agreement, the Company agrees
to employ  Employee  as its Vice  President  and Chief  Financial  Officer,  and
Employee agrees to perform the duties  associated with that position  diligently
and to the reasonable satisfaction of the Company. From the Effective Date until
termination of this  Agreement,  Employee will devote  Employee's  full business
time,  attention  and energies to the  business of the Company.  Nothing in this
Agreement, however, will prohibit Employee from engaging in trade association or
charitable  activities,  including serving as a board member or committee member
to trade  associations  or  charities;  provided  that  none of such  activities
interfere with the performance of Employee's duties and  responsibilities to the
Company under this Agreement.  Employee's  principal place of employment will be
Austin,  Texas;  provided,  however,  that  Employee  will  travel to the extent
reasonably  requested  by the  Company's  Chief  Executive  Officer  or Board of
Directors  for  Employee  to  perform  his  duties as Vice  President  and Chief
Financial Officer of the Company.

         2. Term and Termination. Employee will be employed under this Agreement
for an initial term of two years (the "Initial Term"),  beginning on the date of
the Agreement (the "Effective  Date").  This Agreement will renew for successive
one year periods after the  completion of the Initial Term,  unless either party
gives prior  written  notice to the  contrary to the other party no less than 30
days prior to the end of the Initial Term or renewal period, as the case may be.
The  Agreement  may be sooner  terminated  by either  party in  accordance  with
Section 3 of this Agreement.

         3.  Termination  Benefits.  If, prior to the end of the Initial Term or
any  renewal  period,  as the  case  may be,  (a) the  Company  terminates  this
Agreement  other than for Cause (as defined below),  or (b) Employee  terminates
his  employment  for Good Reason (as defined  below),  then the Company  will be
obligated  to pay  Employee  in a lump sum,  within  thirty (30) days after such
event,  an amount  equal to  Employee's  base salary and  maximum  discretionary
incentive  bonus in effect on the date of such  termination for the remainder of
the  Initial  Term or any  renewal  period,  as the case may be. As used in this
Agreement (i)  termination for "Cause" means any termination of Employee for (a)
the commission of an act of fraud or embezzlement  against the Company,  (b) the
conviction of, or a plea of "guilty" or "no contest" to, a felony under the laws
of the United States or any state,  (c) consistent  willful  misconduct or gross
negligence in performing  Employee's duties hereunder,  or (d) a material breach
of any of the terms of this Agreement or any other agreement between the Company
and Employee relating to

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Employee's employment, if such breach causes material harm to the Company, after
written  notice of such breach and reasonable  opportunity  to cure;  (ii) "Good
Reason" means any of the following that occurs without  Employee's express prior
written  consent:  (a) an adverse  change by the  Company in  Employee's  title,
function, duties or responsibilities (including reporting responsibilities), (b)
Employee's  base  salary  is  reduced  by the  Company,  or there is a  material
reduction in the benefits  that are in effect for  Employee,  (c)  relocation of
Employee's  principal  place of employment to a place located more than 50 miles
outside of Austin,  Texas,  (d) a Change in Control (as defined  below),  or (e)
other  material  breach of this Agreement by the Company after written notice of
such breach and reasonable  opportunity to cure; and (iii) a "Change in Control"
means any of the  following  that  occurs in a single  transaction  or series of
related  transactions:  (a) the  direct  or  indirect  sale or  exchange  by the
shareholders of the Company of more than fifty percent (50%) of the voting stock
of the Company  (other  than the sale or exchange of such voting  stock to (A) a
trustee or other  fiduciary  holding  stock under one or more  employee  benefit
plans maintained by the Company,  or (B) any entity that,  immediately  prior to
such sale or exchange,  is owned directly or indirectly by the  stockholders  of
the Company in  approximately  the same  proportion as their ownership of voting
stock in the Company  immediately prior to such sale or exchange);  (b) a merger
or consolidation in which the shareholders of the Company immediately before the
transaction do not retain, immediately after the transaction, direct or indirect
beneficial  ownership  of more than fifty  percent  (50%) of the total  combined
voting  power of the  outstanding  voting  stock of the  Company;  (c) the sale,
exchange,  lease or  transfer of all or  substantially  all of the assets of the
Company (unless, following such transaction,  such assets are owned by a company
or other  entity and the  shareholders  of the  Company  immediately  before the
transaction  have direct or  indirect  beneficial  ownership  of more than fifty
percent (50%) of the total  combined  voting power of such company or entity) or
(d) the complete liquidation or dissolution of the Company.

         4. Compensation.  Beginning on the Effective Date and thereafter during
the term of Employee's  employment,  the Company will pay Employee a base salary
of not less  than  $175,000  per  year,  payable  biweekly  or  semi-monthly  in
accordance  with the  payroll  practices  of the  Company in effect from time to
time.  Such base  salary  may not be  reduced  and will be subject to review and
potential upward  adjustment  periodically,  but at least on an annual basis, in
accordance with the compensation  policies of the Company in effect from time to
time.  Employee will also,  during the  remainder of the term of this  Agreement
beginning on January 1, 2005,  be eligible  for  discretionary  incentive  bonus
payments,  payable  quarterly  beginning on March 31, 2005, of up to $18,750 per
quarter.  Such  bonus  will be awarded  in  accordance  with the bonus  policies
established  by the Company from time to time.  When the Company issues or sells
any common stock or other  capital  stock or similar  securities or any security
convertible or  exchangeable  into or for common stock or other capital stock or
similar  securities  ("Equity  Securities")  for  cash  during  the term of this
Agreement in a transaction  in which the gross  proceeds to the Company from the
sale of the Equity Securities are at least $5,000,000 (the "Initial Financing"),
Employee will receive a one time  incentive  bonus  payment of $75,000,  payable
upon the closing of the Initial Financing. If the Company issues or sells Equity
Securities for cash on or before the first  anniversary of the Effective Date in
a transaction  or series of  transactions  consistent  with the  financing  plan
adopted by the Board of  Directors of the Company  (the  "Planned  Financings"),
effective on the first anniversary of the Effective Date, Employee's base salary
will be  increased  to not  less  than  $200,000  per  year.  All of  Employee's

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compensation  under this Agreement will be subject to deduction and  withholding
authorized or required by applicable law.

         5. Stock  Option.  The Company  will grant  Employee a stock  option to
purchase  1,158,355  shares of the Company's  common stock,  par value $0.03 per
share ("Common Stock"). Such option will be granted as soon as practicable after
the date of this Agreement.  The exercise price per share of such option will be
equal to the fair  market  value of the Common  Stock on the date of such grant.
The term of such option will be seven (7) years,  subject to earlier termination
as set  forth  in the  applicable  stock  option  agreement,  and  will  vest in
twenty-four (24) equal monthly installments,  beginning the month after the date
of grant.  The option will become fully vested upon a Change in Control.  On the
first  anniversary  of the  Effective  Date,  if the Company has  completed  the
Planned  Financings  prior to such date,  the  Company  will grant  Employee  an
additional  stock option to purchase  165,480  shares of the Common Stock,  with
terms to be determined by the Board of Directors, or a committee of the Board of
Directors,  at the time of such  grant.  The  exercise  price  per share of such
option will be equal to the fair market value of the Common Stock on the date of
grant.

         6. Employee  Benefits.  Beginning on the Effective  Date and thereafter
during the term of this  Agreement,  the Company will  provide to Employee  such
fringe  benefits,  perquisites,  vacation  and other  benefits  that the Company
generally  provides  to its  executive  employees.  The Company  will  reimburse
Employee for  reasonable  out-of-pocket  business  expenses,  including  without
limitation travel expenses and temporary housing in the Los Angeles,  California
area related to travel  between  Employee's  principal  place of  employment  in
Austin,  Texas and the Company's current operations,  incurred and documented in
accordance  with the  policies of the  Company in effect from time to time.  The
Company  agrees that if Employee is made a party or is  threatened  to be made a
party to any action, suit or proceeding, whether civil, criminal, administrative
or investigative (a "Proceeding"), by reason of the fact that Employee is or was
a trustee, director or officer of the Company or any affiliate of the Company or
is or was serving at the request of the Company or any  affiliate  as a trustee,
director,  officer,  member,  employee  or agent  of  another  corporation  or a
partnership,  joint  venture,  trust or  other  enterprise,  including,  without
limitation,  service with respect to employee benefit plans,  whether or not the
basis of such Proceeding is alleged action in an official capacity as a trustee,
director,  officer,  member,  employee  or agent  while  serving  as a  trustee,
director,  officer,  member, employee or agent, Employee shall be indemnified to
the  fullest  extent  authorized  by  California  law, as the same exists or may
hereafter be amended,  against all expenses  incurred or suffered by Employee in
connection  therewith.  If the Company  maintains  a  directors'  and  officers'
insurance  policy,  Employee  shall  be  covered  to the  same  extent  as other
employees.

         7. No Obligation to Third Party.  Employee represents and warrants that
Employee is not under any obligation to any person or other third party and does
not have any  other  interest  that is  inconsistent  or in  conflict  with this
Agreement,  or which would prevent,  limit, or impair Employee's  performance of
any of the  covenants  hereunder  or  Employee's  duties as an  employee  of the
Company.

         8.  Confidentiality.  In consideration of the benefits  provided for in
this  Agreement,  Employee  agrees  not  to,  at any  time,  either  during  his
employment or thereafter,  divulge,  use, publish or in any other manner reveal,
directly or indirectly,  to any person,  firm,  corporation or

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any other form of business organization or arrangement and keep in the strictest
confidence any Confidential Information,  except, (i) as may be necessary to the
performance  of Employee's  duties  hereunder,  (ii) with the Company's  express
written consent,  (iii) to the extent that any such information is in or becomes
in the  public  domain  other  than as a  result  of  Employee's  breach  of any
obligations  hereunder,  or (iv) where  required to be disclosed by court order,
subpoena or other government process and in such event, Employee shall cooperate
with the Company in attempting to keep such information  confidential.  Upon the
request of the Company,  Employee agrees to promptly  deliver to the Company the
originals  and  all  copies,  in  whatever  medium,  of  all  such  Confidential
Information.  "Confidential  Information," as used in this Agreement, shall mean
any and all secret,  proprietary  and  confidential  information  concerning the
business of the  Company  and its  affiliates,  including,  without  limitation,
business and marketing plans,  strategies,  models,  codes,  client  information
(including  client  identity and  contacts,  client lists,  client  financial or
personal information),  business relationships (including persons,  corporations
or other  entities  performing  services  on behalf of or  otherwise  engaged in
business  transactions  with the Company and its  affiliates or their  clients),
accounts, financial data, know-how, computer software and related documentation,
trade secrets, processes,  policies and/or personnel, and any other information,
data or the like that is labeled  confidential  or is treated as confidential by
the Company.

         9. Non-Solicitation. Employee acknowledges that by virtue of Employee's
position as Vice  President  and Chief  Financial  Officer of the  Company,  and
Employee's employment hereunder, he will have advantageous familiarity with, and
knowledge  about,  the  Company and will be  instrumental  in  establishing  and
maintaining  goodwill  between the Company and its customers,  which goodwill is
the  property  of the  Company.  Therefore,  Employee  agrees  that  during  his
employment and for a twelve (12) month period  thereafter,  Employee will not on
behalf of  himself  or any other  person or entity,  solicit,  take away,  hire,
employ or endeavor to employ any of the employees of the Company.

         10.  Non-Disparagement.  Employee  acknowledges and agrees that he will
not defame or publicly criticize the services, business,  integrity, veracity or
personal or professional reputation of the Company and its officers,  directors,
partners,  executives  or agents  thereof in either a  professional  or personal
manner at any time during or following his employment with the Company.

         11. Enforcement. If Employee commits a breach, or threatens to commit a
breach, of any of the provisions of Sections 8-10 of this Agreement, the Company
shall have the right and remedy to have the provisions  specifically enforced by
any court having jurisdiction, it being acknowledged and agreed by Employee that
the services  being rendered  hereunder to the Company are of a special,  unique
and  extraordinary  character and that any such breach or threatened breach will
cause irreparable  injury to the Company and that money damages will not provide
an adequate  remedy to the  Company.  Such right and remedy shall be in addition
to, and not in lieu of, any other rights and  remedies  available to the Company
at law or in  equity.  Accordingly,  Employee  consents  to the  issuance  of an
injunction, whether preliminary or permanent,  consistent with the terms of this
Agreement.  In  addition,  the Company  shall have the right to cease making any
payments or provide any benefits to Employee  under this  Agreement in the event
he breaches or threatens to breach any of the provisions hereof.

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         12. Blue Pencil. If, at any time, the provisions of Sections 8-10 shall
be determined to be invalid or unenforceable under any applicable law, by reason
of being vague or unreasonable as to area,  duration or scope of activity,  this
Agreement  shall be  considered  divisible  and shall become and be  immediately
amended to only such area, duration and scope of activity as shall be determined
to be reasonable and enforceable by the court or other body having  jurisdiction
over the matter and  Employee  and the Company  agree that this  Agreement as so
amended  shall be valid and  binding  as though  any  invalid  or  unenforceable
provision had not been included herein.

EMPLOYEE ACKNOWLEDGES THAT he HAS CAREFULLY READ SECTIONS 8-10 OF THIS AGREEMENT
AND HAS HAD THE  OPPORTUNITY  TO REVIEW ITS  PROVISIONS  WITH ANY ADVISORS AS he
CONSIDERED NECESSARY AND THAT EMPLOYEE UNDERSTANDS THIS AGREEMENT'S CONTENTS AND
SIGNIFIES SUCH UNDERSTANDING AND AGREEMENT BY SIGNING BELOW.

         13. Entire Agreement. This Agreement constitutes the complete agreement
of the parties  with respect to the subject  matter  hereof and  supersedes  any
prior written,  or prior or contemporaneous  oral,  understandings or agreements
between the parties that relates in any way to the subject matter  hereof.  This
Agreement may be amended only in writing executed by the Company and Employee.

         14. Binding  Effect.  This Agreement shall be binding upon and inure to
the  benefit  of  the  respective  heirs,   executors,   administrators,   legal
representatives and successors of the Company and Employee.

         15. Notice.  Any notice required or permitted under this Agreement must
be in writing and will be deemed to have been given when  delivered  personally,
by telecopy or by  overnight  courier  service or three days after being sent by
mail,  postage  prepaid,  to (a) if to the Company,  to the Company's  principal
place  of  business,  or (b)  if to  Employee,  to  Employee's  residence  or to
Employee's  latest address then  contained in the Company's  records (or to such
changed  address as such person may  subsequently  give notice of in  accordance
herewith).

         16. GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE SUBSTANTIVE  LAWS OF THE STATE OF CALIFORNIA,
WITHOUT  GIVING  EFFECT TO ANY  CONFLICTS OF LAW,  RULE OR PRINCIPLE  THAT MIGHT
REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

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         IN  WITNESS  WHEREOF,  the  Company  and  Employee  have  executed  and
delivered this Agreement as of the date first above written.

                                       NORTHGATE INNOVATIONS, INC.


                                       By:
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                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------




                                       -----------------------------------------
                                       Theodore B. Muftic