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                                                                   Exhibit 10.3


                                ZORAN CORPORATION

                              AMENDED AND RESTATED

                        1995 EMPLOYEE STOCK PURCHASE PLAN

                       (AS AMENDED THROUGH JULY 18, 2000)


         1.       ESTABLISHMENT, PURPOSE AND TERM OF PLAN.

                  1.1 ESTABLISHMENT. The Zoran Corporation 1995 Employee
Stock Purchase Plan was initially established effective December 14, 1995
(the "EFFECTIVE DATE"), the effective date of the initial registration by the
Company of its Stock under Section 12 of the Exchange Act (the "INITIAL
PLAN"). The Initial Plan was amended and restated in its entirety as the
Zoran Corporation Amended and Restated 1995 Employee Stock Purchase Plan (the
"PLAN") effective as of the date of commencement of the first Offering under
the Plan following approval of the Plan by the stockholders of the Company on
June 6, 1996.

                  1.2 PURPOSE. The purpose of the Plan to provide Eligible
Employees of the Participating Company Group with an opportunity to acquire a
proprietary interest in the Company through the purchase of Stock. The
Company intends that the Plan shall qualify as an "employee stock purchase
plan" under Section 423 of the Code (including any amendments or replacements
of such section), and the Plan shall be so construed.

                  1.3 TERM OF PLAN. The Plan shall continue in effect until
the earlier of its termination by the Board or the date on which all of the
shares of Stock available for issuance under the Plan have been issued.

         2.       DEFINITIONS AND CONSTRUCTION.

                  2.1 DEFINITIONS. Any term not expressly defined in the Plan
but defined for purposes of Section 423 of the Code shall have the same
definition herein. Whenever used herein, the following terms shall have their
respective meanings set forth below:

                           (a)      "BOARD" means the Board of Directors of
the Company.  If one or more Committees have been appointed by the Board to
administer the Plan, "Board" also means such Committee(s).

                           (b)      "CODE" means the Internal Revenue Code of
1986, as amended, and any applicable regulations promulgated thereunder.

                           (c)      "COMMITTEE" means a committee of the
Board duly appointed to administer the Plan and having such powers as shall
be specified by the Board. Unless the powers of the Committee have been
specifically limited, the Committee shall have all of the powers of the Board
granted herein, including, without limitation, the power to amend or
terminate the Plan at any time, subject to the terms of the Plan and any
applicable limitations imposed by law.

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                           (d)      "COMPANY" means Zoran Corporation, a
Delaware corporation, or any successor corporation thereto.

                           (e)      "COMPENSATION" means, with respect to an
Offering Period under the Plan, all amounts paid in cash in the form of base
salary during such Offering Period before deduction for any contributions to
any plan maintained by a Participating Company and described in Section
401(k) or Section 125 of the Code. Compensation shall not include
commissions, overtime, bonuses, annual awards, other incentive payments,
shift premiums, reimbursements of expenses, allowances, long-term disability,
workers' compensation or any amount deemed received without the actual
transfer of cash or any amounts directly or indirectly paid pursuant to the
Plan or any other stock purchase or stock option plan.

                           (f)      "ELIGIBLE EMPLOYEE" means an Employee who
meets the requirements set forth in Section 5 for eligibility to participate
in the Plan.

                           (g)      "EMPLOYEE" means any person treated as an
employee (including an officer or a Director who is also treated as an
employee) in the records of a Participating Company and for purposes of
Section 423 of the Code; provided, however, that neither service as a
Director nor payment of a director's fee shall be sufficient to constitute
employment for purposes of the Plan.

                           (h)      "EXCHANGE ACT" means the Securities
Exchange Act of 1934, as amended.

                           (i)      "FAIR MARKET VALUE" means, as of any
date, if there is then a public market for the Stock, the closing price of a
share of Stock (or the mean of the closing bid and asked prices of a share of
Stock if the Stock is so reported instead) as reported on the National
Association of Securities Dealers Automated Quotation ("NASDAQ") System, the
NASDAQ National Market System or such other national or regional securities
exchange or market system constituting the primary market for the Stock. If
the relevant date does not fall on a day on which the Stock is trading on
NASDAQ, the NASDAQ National Market System or other national or regional
securities exchange or market system, the date on which the Fair Market Value
shall be established shall be the last day on which the Stock was so traded
prior to the relevant date, or such other appropriate day as shall be
determined by the Board, in its sole discretion. If there is then no public
market for the Stock, the Fair Market Value on any relevant date shall be as
determined by the Board without regard to any restriction other than a
restriction which, by its terms, will never lapse. Notwithstanding the
foregoing, the Fair Market Value per share of Stock on the Effective Date
shall be deemed to be the public offering price set forth in the final
prospectus filed with the Securities and Exchange Commission in connection
with the initial public offering of the Stock.

                           (j)      "OFFERING" means an offering of Stock as
provided in Section 6.

                           (k)      "OFFERING DATE" means, for any Offering
Period, the first day of such Offering Period.

                           (l)      "OFFERING PERIOD" means a period
determined in accordance with Section 6.1.

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                           (m)      "PARENT CORPORATION" means any present or
future "parent corporation" of the Company, as defined in Section 424(e) of
the Code.

                           (n)      "PARTICIPANT" means an Eligible Employee
participating in the Plan.

                           (o)      "PARTICIPATING COMPANY" means the Company
or any Parent Corporation or Subsidiary Corporation which the Board
determines should be included in the Plan. The Board shall have the sole and
absolute discretion to determine from time to time what Parent Corporations
or Subsidiary Corporations shall be Participating Companies.

                           (p)      "PARTICIPATING COMPANY GROUP" means, at
any point in time, the Company and all other corporations collectively which
are then Participating Companies.

                           (q)      "PURCHASE DATE" means, for any Purchase
Period, the last day of such Purchase Period.

                           (r)      "PURCHASE PERIOD" means a period
determined in accordance with Section 6.2.

                           (s)      "PURCHASE PRICE" means the price at which
a share of Stock may be purchased pursuant to the Plan, as determined in
accordance with Section 9.

                           (t)      "PURCHASE RIGHT" means an option pursuant
to the Plan to purchase such shares of Stock as provided in Section 8 which
may or may not be exercised during an Offering Period. Such option arises
from the right of a Participant to withdraw such Participant's accumulated
payroll deductions not previously applied to the purchase of Stock under the
Plan (if any) and terminate participation in the Plan or any Offering therein
at any time during an Offering Period.

                           (u)      "STOCK" means the common stock, par value
$0.001, of the Company, as adjusted from time to time in accordance with
Section 4.2.

                           (v)      "SUBSIDIARY CORPORATION" means any
present or future "subsidiary corporation" of the Company, as defined in
Section 424(f) of the Code.

                  2.2 CONSTRUCTION. Captions and titles contained herein are
for convenience only and shall not affect the meaning or interpretation of
any provision of the Plan. Except when otherwise indicated by the context,
the singular shall include the plural, the plural shall include the singular,
and use of the term "or" shall include the conjunctive as well as the
disjunctive.

         3.       ADMINISTRATION. The Plan shall be administered by the
Board, including any duly appointed Committee of the Board. All questions of
interpretation of the Plan or of any Purchase Right shall be determined by
the Board and shall be final and binding upon all persons having an interest
in the Plan or such Purchase Right. Subject to the provisions of the Plan,
the Board shall determine all of the relevant terms and conditions of
Purchase Rights granted pursuant to the Plan; provided, however, that all
Participants granted Purchase Rights pursuant to the Plan shall have the same
rights and privileges within the meaning of Section 423(b)(5) of the Code.
All expenses incurred in connection with the administration of the Plan shall
be paid by the Company.

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         4.       SHARES SUBJECT TO PLAN.

                  4.1 MAXIMUM NUMBER OF SHARES ISSUABLE. Subject to
adjustment as provided in Section 4.2, the maximum aggregate number of shares
of Stock that may be issued under the Plan shall be five hundred thousand
(500,000) and shall consist of authorized but unissued or reacquired shares
of the Stock, or any combination thereof. If an outstanding Purchase Right
for any reason expires or is terminated or canceled, the shares of Stock
allocable to the unexercised portion of such Purchase Right shall again be
available for issuance under the Plan.

                  4.2 ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the
event of any stock dividend, stock split, reverse stock split,
recapitalization, combination, reclassification or similar change in the
capital structure of the Company, or in the event of any merger (including a
merger effected for the purpose of changing the Company's domicile), sale of
assets or other reorganization in which the Company is a party, appropriate
adjustments shall be made in the number and class of shares subject to the
Plan, to the Offering Share Limit set forth in Section 8.1 and to each
Purchase Right and in the Purchase Price.

         5.       ELIGIBILITY.

                  5.1 EMPLOYEES ELIGIBLE TO PARTICIPATE. Any Employee of a
Participating Company is eligible to participate in the Plan except the
following:

                           (a)      Employees who are customarily employed by
the Participating Company Group for twenty (20) hours or less per week;

                           (b)      Employees who are customarily employed by
the Participating Company Group for not more than five (5) months in any
calendar year; and

                           (c)      Employees who own or hold options to
purchase or who, as a result of participation in the Plan, would own or hold
options to purchase, stock of the Company or of any Parent Corporation or
Subsidiary Corporation possessing five percent (5%) or more of the total
combined voting power or value of all classes of stock of such corporation
within the meaning of Section 423(b)(3) of the Code.

                  5.2 LEASED EMPLOYEES EXCLUDED. Notwithstanding anything
herein to the contrary, any individual performing services for a
Participating Company solely through a leasing agency or employment agency
shall not be deemed an "Employee" of such Participating Company.

         6.       OFFERINGS.

                  6.1 OFFERING PERIODS. Except as otherwise set forth below,
the Plan shall be implemented by sequential Offerings of approximately
twenty-four (24) months duration (an "OFFERING PERIOD"); provided, however
that the first Offering Period shall commence on the Effective Date and end
on October 31, 1997 (the "INITIAL OFFERING PERIOD"). Subsequent Offerings
shall commence on the first days of May and November of each year and end on
the last days of the second April and October, respectively, occurring
thereafter. Notwithstanding the foregoing, the Board may establish a
different term for one or more Offerings or different commencing or ending
dates for such Offerings; provided, however, that no Offering may

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exceed a term of twenty-seven (27) months. An Employee who becomes an
Eligible Employee after an Offering Period has commenced shall not be
eligible to participate in such Offering but may participate in any
subsequent Offering provided such Employee is still an Eligible Employee as
of the commencement of any such subsequent Offering. Eligible Employees may
not participate in more than one Offering at a time. In the event the first
or last day of an Offering Period is not a business day, the Company shall
specify the business day that will be deemed the first or last day, as the
case may be, of the Offering Period.

                  6.2 PURCHASE PERIODS. Each Offering Period shall consist of
four (4) consecutive purchase periods of approximately six (6) months
duration (individually, a "PURCHASE PERIOD"). The Purchase Period commencing
on the Offering Date of the Initial Offering Period shall end on April 30,
1996. A Purchase Period commencing on the first day of May shall end on the
last day of the next following October. A Purchase Period commencing on the
first day of November shall end on the last day of the next following April.
Notwithstanding the foregoing, the Board may establish a different term for
one or more Purchase Periods or different commencing or ending dates for such
Purchase Periods. In the event the first or last day of a Purchase Period is
not a business day, the Company shall specify the business day that will be
deemed the first or last day, as the case may be, of the Purchase Period.

                  6.3 GOVERNMENTAL APPROVAL; STOCKHOLDER APPROVAL.
Notwithstanding any other provision of the Plan to the contrary, any Purchase
Right granted pursuant to the Plan shall be subject to (a) obtaining all
necessary governmental approvals or qualifications of the sale or issuance of
the Purchase Rights or the shares of Stock and (b) obtaining stockholder
approval of the Plan. Notwithstanding the foregoing, stockholder approval
shall not be necessary in order to grant any Purchase Right granted in the
Plan's Initial Offering Period; provided, however, that the exercise of any
such Purchase Right shall be subject to obtaining stockholder approval of the
Plan.

         7.       PARTICIPATION IN THE PLAN.

                  7.1 INITIAL PARTICIPATION. An Eligible Employee shall
become a Participant on the first Offering Date after satisfying the
eligibility requirements of Section 5 and delivering to the Company's payroll
office or other office designated by the Company not later than the close of
business for such office on the last business day before such Offering Date
(the "SUBSCRIPTION DATE") a subscription agreement indicating the Employee's
election to participate in the Plan and authorizing payroll deductions. An
Eligible Employee who does not deliver a subscription agreement to the
Company's payroll or other designated office on or before the Subscription
Date shall not participate in the Plan for that Offering Period or for any
subsequent Offering Period unless such Employee subsequently enrolls in the
Plan by filing a subscription agreement with the Company by the Subscription
Date for such subsequent Offering Period. The Company may, from time to time,
change the Subscription Date as deemed advisable by the Company in its sole
discretion for proper administration of the Plan.

                  7.2 CONTINUED PARTICIPATION. A Participant shall
automatically participate in the Offering Period commencing immediately after
the final Purchase Date of each Offering Period in which the Participant
participates until such time as such Participant (a) ceases to be an Eligible
Employee, (b) withdraws from the Plan pursuant to Section 13.2 or (c)
terminates employment as provided in Section 14. If a Participant
automatically may participate in a subsequent Offering Period pursuant to
this Section 7.2, then the Participant is not required to

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file any additional subscription agreement for such subsequent Offering
Period in order to continue participation in the Plan. However, a Participant
may file a subscription agreement with respect to a subsequent Offering
Period if the Participant desires to change any of the Participant's
elections contained in the Participant's then effective subscription
agreement.

         8.       RIGHT TO PURCHASE SHARES.

                  8.1 PURCHASE RIGHT. Except as set forth below, during an
Offering Period each Participant in such Offering Period shall have a
Purchase Right consisting of the right to purchase that number of whole
shares of Stock arrived at by dividing Fifty Thousand Dollars ($50,000) by
the Fair Market Value of a share of Stock on the Offering Date of such
Offering Period; provided, however, that such number shall not exceed 5,000
shares (the "OFFERING SHARE LIMIT"). Shares of Stock may only be purchased
through a Participant's payroll deductions pursuant to Section 10.

                  8.2 PRO RATA ADJUSTMENT OF PURCHASE RIGHT. Notwithstanding
the foregoing, if the Board shall establish an Offering Period of less than
twenty-three and one-half (23 1/2) months in duration or more than
twenty-four and one-half (24 1/2) months in duration, (a) the dollar amount
in Section 8.1 shall be determined by multiplying $2,083.33 by the number of
months in the Offering Period and rounding to the nearest whole dollar, and
(b) the Offering Share Limit shall be determined by multiplying 208.33 shares
by the number of months in the Offering Period and rounding to the nearest
whole share. For purposes of the preceding sentence, fractional months shall
be rounded to the nearest whole month.

         9.       PURCHASE PRICE. The Purchase Price at which each share of
Stock may be acquired in a given Offering Period pursuant to the exercise of
all or any portion of a Purchase Right granted under the Plan shall be set by
the Board; provided, however, that the Purchase Price shall not be less than
eighty-five percent (85%) of the lesser of (a) the Fair Market Value of a
share of Stock on the Offering Date of the Offering Period, or (b) the Fair
Market Value of a share of Stock on the Purchase Date of the Offering Period.
Unless otherwise provided by the Board prior to the commencement of an
Offering Period, the Purchase Price for that Offering Period shall be
eighty-five percent (85%) of the lesser of (a) the Fair Market Value of a
share of Stock on the Offering Date of the Offering Period, or (b) the Fair
Market Value of a share of Stock on the Purchase Date of the Offering Period.

         10.      ACCUMULATION OF PURCHASE PRICE THROUGH PAYROLL DEDUCTION.
Shares of Stock which are acquired pursuant to the exercise of all or any
portion of a Purchase Right for an Offering Period may be paid for only by
means of payroll deductions from the Participant's Compensation accumulated
during the Offering Period. Except as set forth below, the amount of
Compensation to be deducted from a Participant's Compensation during each pay
period shall be determined by the Participant's subscription agreement.

                  10.1 COMMENCEMENT OF PAYROLL DEDUCTIONS. Payroll deductions
shall commence on the first payday following the Offering Date and shall
continue to the end of the Offering Period unless sooner altered or
terminated as provided in the Plan.

                  10.2 LIMITATIONS ON PAYROLL DEDUCTIONS. The amount of
payroll deductions with respect to the Plan for any Participant during any
pay period shall be in one percent (1%) increments not to exceed ten percent
(10%) of the Participant's Compensation for such pay

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period. Notwithstanding the foregoing, the Board may change the limits on
payroll deductions effective as of a future Offering Date, as determined by
the Board. Amounts deducted from Compensation shall be reduced by any amounts
contributed by the Participant and applied to the purchase of Company stock
pursuant to any other employee stock purchase plan qualifying under Section
423 of the Code.

                  10.3 ELECTION TO CHANGE OR STOP PAYROLL DEDUCTIONS. During
an Offering Period, a Participant may elect to increase or decrease the
amount deducted or stop deductions from his or her Compensation by filing an
amended subscription agreement with the Company on or before the "Change
Notice Date." The "CHANGE NOTICE DATE" shall initially be the seventh (7th)
day prior to the end of the first pay period for which such election is to be
effective; however, the Company may change such Change Notice Date from time
to time. A Participant who elects to decrease the rate of his or her payroll
deductions to zero percent (0%) shall nevertheless remain a Participant in
the current Offering Period unless such Participant subsequently withdraws
from the Offering or the Plan as provided in Sections 13.1 and 13.2,
respectively, or is automatically withdrawn from the Offering as provided in
Section 13.4.

                  10.4 PARTICIPANT ACCOUNTS. Individual Plan accounts shall
be maintained for each Participant. All payroll deductions from a
Participant's Compensation shall be credited to such account and shall be
deposited with the general funds of the Company. All payroll deductions
received or held by the Company may be used by the Company for any corporate
purpose.

                  10.5 NO INTEREST PAID.  Interest shall not be paid on sums
deducted from a Participant's Compensation pursuant to the Plan.

                  10.6 COMPANY ESTABLISHED PROCEDURES. The Company may, from
time to time, establish or change (a) a minimum required payroll deduction
amount for participation in an Offering, (a) limitations on the frequency or
number of changes in the rate of payroll deduction during an Offering, (c) an
exchange ratio applicable to amounts withheld in a currency other than U.S.
dollars, (d) payroll deduction in excess of or less than the amount
designated by a Participant in order to adjust for delays or mistakes in the
Company's processing of subscription agreements, (e) the date(s) and manner
by which the Fair Market Value of a share of Stock is determined for purposes
of administration of the Plan, or (vi) such other limitations or procedures
as deemed advisable by the Company in the Company's sole discretion which are
consistent with the Plan and in accordance with the requirements of
Section 423 of the Code.

         11.      PURCHASE OF SHARES.

                  11.1 EXERCISE OF PURCHASE RIGHT. On each Purchase Date of
an Offering Period, each Participant who has not withdrawn from the Offering
or whose participation in the Offering has not terminated on or before such
Purchase Date shall automatically acquire pursuant to the exercise of the
Participant's Purchase Right the number of whole shares of Stock arrived at
by dividing the total amount of the Participant's accumulated payroll
deductions for the Purchase Period by the Purchase Price; provided, however,
in no event shall the number of shares purchased by the Participant during an
Offering Period exceed the number of shares subject to the Participant's
Purchase Right. No shares of Stock shall be purchased on a Purchase Date on
behalf of a Participant whose participation in the Offering or the Plan has
terminated on or before such Purchase Date.

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                  11.2 RETURN OF CASH BALANCE. Any cash balance remaining in
the Participant's Plan account shall be refunded to the Participant as soon
as practicable after the Purchase Date. In the event the cash to be returned
to a Participant pursuant to the preceding sentence is an amount less than
the amount necessary to purchase a whole share of Stock, the Company may
establish procedures whereby such cash is maintained in the Participant's
Plan account and applied toward the purchase of shares of Stock in the
subsequent Purchase Period or Offering Period.

                  11.3 TAX WITHHOLDING. At the time a Participant's Purchase
Right is exercised, in whole or in part, or at the time a Participant
disposes of some or all of the shares of Stock he or she acquires under the
Plan, the Participant shall make adequate provision for the foreign, federal,
state and local tax withholding obligations of the Participating Company
Group, if any, which arise upon exercise of the Purchase Right or upon such
disposition of shares, respectively. The Participating Company Group may, but
shall not be obligated to, withhold from the Participant's compensation the
amount necessary to meet such withholding obligations.

                  11.4 EXPIRATION OF PURCHASE RIGHT. Any portion of a
Participant's Purchase Right remaining unexercised after the end of the
Offering Period to which such Purchase Right relates shall expire immediately
upon the end of such Offering Period.

         12.      LIMITATIONS ON PURCHASE OF SHARES; RIGHTS AS A STOCKHOLDER.

                  12.1 FAIR MARKET VALUE LIMITATION. Notwithstanding any
other provision of the Plan, no Participant shall be entitled to purchase
shares of Stock under the Plan (or any other employee stock purchase plan
which is intended to meet the requirements of Section 423 of the Code
sponsored by the Company or a Parent Corporation or Subsidiary Corporation)
at a rate which exceeds $25,000 in Fair Market Value, which Fair Market Value
is determined for shares purchased during a given Offering Period as of the
Offering Date for such Offering Period (or such other limit as may be imposed
by the Code), for each calendar year in which the Participant participates in
the Plan (or any other employee stock purchase plan described in this
sentence).

                  12.2 PRO RATA ALLOCATION. In the event the number of shares
of Stock which might be purchased by all Participants in the Plan exceeds the
number of shares of Stock available in the Plan, the Company shall make a pro
rata allocation of the remaining shares in as uniform a manner as shall be
practicable and as the Company shall determine to be equitable.

                  12.3 RIGHTS AS A STOCKHOLDER AND EMPLOYEE. A Participant
shall have no rights as a stockholder by virtue of the Participant's
participation in the Plan until the date of the issuance of a stock
certificate for the shares of Stock being purchased pursuant to the exercise
of the Participant's Purchase Right. No adjustment shall be made for cash
dividends or distributions or other rights for which the record date is prior
to the date such stock certificate is issued. Nothing herein shall confer
upon a Participant any right to continue in the employ of the Participating
Company Group or interfere in any way with any right of the Participating
Company Group to terminate the Participant's employment at any time.

         13.      WITHDRAWAL.

                  13.1 WITHDRAWAL FROM AN OFFERING. A Participant may
withdraw from an Offering by signing and delivering to the Company's payroll
or other designated office a written notice of withdrawal on a form provided
by the Company for such purpose. Such withdrawal

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may be elected at any time prior to the end of an Offering Period; provided,
however, if a Participant withdraws after a Purchase Date, the withdrawal
shall not affect shares of Stock acquired by the Participant on such Purchase
Date. Unless otherwise indicated, withdrawal from an Offering shall not
result in a withdrawal from the Plan or any succeeding Offering therein. By
withdrawing from an Offering effective as of the close of a given Purchase
Date, a Participant may have shares of Stock purchased on such Purchase Date
and immediately commence participation in the new Offering commencing
immediately after such Purchase Date. A Participant is prohibited from again
participating in an Offering at any time following withdrawal from such
Offering. The Company may impose, from time to time, a requirement that the
notice of withdrawal be on file with the Company's payroll office or other
designated office for a reasonable period prior to the effectiveness of the
Participant's withdrawal from an Offering.

                  13.2 WITHDRAWAL FROM THE PLAN. A Participant may withdraw
from the Plan by signing and delivering to the Company's payroll office or
other designated office a written notice of withdrawal on a form provided by
the Company for such purpose. Withdrawals made after a Purchase Date shall
not affect shares of Stock acquired by the Participant on such Purchase Date.
In the event a Participant voluntarily elects to withdraw from the Plan, the
Participant may not resume participation in the Plan during the same Offering
Period, but may participate in any subsequent Offering under the Plan by
again satisfying the requirements of Sections 5 and 7.1. The Company may
impose, from time to time, a requirement that the notice of withdrawal be on
file with the Company's payroll office or other designated office for a
reasonable period prior to the effectiveness of the Participant's withdrawal
from the Plan.

                  13.3 RETURN OF PAYROLL DEDUCTIONS. Upon a Participant's
withdrawal from an Offering or the Plan pursuant to Sections 13.1 or 13.2,
respectively, the Participant's accumulated payroll deductions which have not
been applied toward the purchase of shares of Stock shall be returned as soon
as practicable after the withdrawal, without the payment of any interest, to
the Participant, and the Participant's interest in the Offering or the Plan,
as applicable, shall terminate. Such accumulated payroll deductions may not
be applied to any other Offering under the Plan.

                  13.4 AUTOMATIC WITHDRAWAL FROM AN OFFERING. If the Fair
Market Value of a share of Stock on a Purchase Date of an Offering (other
than the final Purchase Date of such Offering) is less than the Fair Market
Value of a share of Stock on the Offering Date for such Offering, then every
Participant shall automatically (a) be withdrawn from such Offering at the
close of such Purchase Date and after the acquisition of shares of Stock for
such Purchase Period and (b) be enrolled in the Offering commencing on the
first business day subsequent to such Purchase Period. A Participant may
elect not to be automatically withdrawn from an Offering Period pursuant to
this Section 13.4 by delivering to the Company not later than the close of
business on the last day before the Purchase Date a written notice indicating
such election.

                   13.5 WAIVER OF WITHDRAWAL RIGHT. The Company may, from
time to time, establish a procedure pursuant to which a Participant may
elect, at least six (6) months prior to a Purchase Date, to have all payroll
deductions accumulated in his or her Plan account as of such Purchase Date
applied to purchase shares of Stock under the Plan, and (a) to waive his or
her right to withdraw from the Offering or the Plan and (b) to waive his or
her right to increase, decrease, or cease payroll deductions under the Plan
from his or her Compensation during the Purchase Period ending on such
Purchase Date. Such election shall be made in writing on a form

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provided by the Company for such purpose and must be delivered to the Company
not later than the close of business on the day preceding the date which is
six (6) months before the Purchase Date for which such election is to first
be effective.

         14.      TERMINATION OF EMPLOYMENT OR ELIGIBILITY. Termination of a
Participant's employment with the Company for any reason, including
retirement, disability or death or the failure of a Participant to remain an
Eligible Employee, shall terminate the Participant's participation in the
Plan immediately. In such event, the payroll deductions credited to the
Participant's Plan account since the last Purchase Date shall, as soon as
practicable, be returned to the Participant or, in the case of the
Participant's death, to the Participant's legal representative, and all of
the Participant's rights under the Plan shall terminate. Interest shall not
be paid on sums returned to a Participant pursuant to this Section 14. A
Participant whose participation has been so terminated may again become
eligible to participate in the Plan by again satisfying the requirements of
Sections 5 and 7.1.

         15.      TRANSFER OF CONTROL.

                  15.1     DEFINITIONS.

                           (a) An "OWNERSHIP CHANGE EVENT" shall be deemed to
have occurred if any of the following occurs with respect to the Company: (i)
the direct or indirect sale or exchange in a single or series of related
transactions by the stockholders of the Company of more than fifty percent
(50%) of the voting stock of the Company; (ii) a merger or consolidation in
which the Company a party; (iii) the sale, exchange, or transfer of all or
substantially all of the assets of the Company; or (iv) a liquidation or
dissolution of the Company.

                           (b) A "TRANSFER OF CONTROL" shall mean an
Ownership Change Event or a series of related Ownership Change Events
(collectively, the "TRANSACTION") wherein the stockholders of the Company
immediately before the Transaction do not retain immediately after the
Transaction, in substantially the same proportions as their ownership of
shares of the Company's voting stock immediately before 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 or the corporation or corporations to which the assets of the Company
were transferred (the "TRANSFEREE CORPORATION(S)"), as the case may be. For
purposes of the preceding sentence, indirect beneficial ownership shall
include, without limitation, an interest resulting from ownership of the
voting stock of one or more corporations which, as a result of the
Transaction, own the Company or the Transferee Corporation(s), as the case
may be, either directly or through one or more subsidiary corporations. The
Board shall have the right to determine whether multiple sales or exchanges
of the voting stock of the Company or multiple Ownership Change Events are
related, and its determination shall be final, binding and conclusive.

                  15.2 EFFECT OF TRANSFER OF CONTROL ON PURCHASE RIGHTS. In
the event of a Transfer of Control, the surviving, continuing, successor, or
purchasing corporation or parent corporation thereof, as the case may be (the
"ACQUIRING CORPORATION"), may assume the Company's rights and obligations
under the Plan or substitute substantially equivalent Purchase Rights for
stock of the Acquiring Corporation. If the Acquiring Corporation elects not
to assume or substitute for the outstanding Purchase Rights, the Board may,
in its sole discretion and notwithstanding any other provision herein to the
contrary, adjust the Purchase Date of the then

<PAGE>

current Purchase Period to a date on or before the date of the Transfer of
Control, but shall not adjust the number of shares of Stock subject to any
Purchase Right. All Purchase Rights which are neither assumed or substituted
for by the Acquiring Corporation in connection with the Transfer of Control
nor exercised as of the date of the Transfer of Control shall terminate and
cease to be outstanding effective as of the date of the Transfer of Control.
Notwithstanding the foregoing, if the corporation the stock of which is
subject to the outstanding Purchase Rights immediately prior to an Ownership
Change Event described in Section 15.1(a)(i) constituting a Transfer of
Control is the surviving or continuing corporation and immediately after such
Ownership Change Event less than fifty percent (50%) of the total combined
voting power of its voting stock is held by another corporation or by other
corporations that are members of an affiliated group within the meaning of
Section 1504(a) of the Code without regard to the provisions of Section
1504(b) of the Code, the outstanding Purchase Rights shall not terminate
unless the Board otherwise provides in its sole discretion.

         16.      NONTRANSFERABILITY OF PURCHASE RIGHTS. A Purchase Right may
not be transferred in any manner otherwise than by will or the laws of
descent and distribution and shall be exercisable during the lifetime of the
Participant only by the Participant. The Company, in its absolute discretion,
may impose such restrictions on the transferability of the shares purchasable
upon the exercise of a Purchase Right as it deems appropriate and any such
restriction shall be set forth in the respective subscription agreement and
may be referred to on the certificates evidencing such shares.

         17.      REPORTS. Each Participant who exercised all or part of his
or her Purchase Right for a Purchase Period shall receive, as soon as
practicable after the Purchase Date of such Purchase Period, a report of such
Participant's Plan account setting forth the total payroll deductions
accumulated, the number of shares of Stock purchased, the Purchase Price for
such shares, the date of purchase and the remaining cash balance to be
refunded or retained in the Participant's Plan account pursuant to Section
11.2, if any. Each Participant shall be provided information concerning the
Company equivalent to that information generally made available to the
Company's common stockholders.

         18.      RESTRICTION ON ISSUANCE OF SHARES. The issuance of shares
under the Plan shall be subject to compliance with all applicable
requirements of foreign, federal or state law with respect to such
securities. A Purchase Right may not be exercised if the issuance of shares
upon such exercise would constitute a violation of any applicable foreign,
federal or state securities laws or other law or regulations. In addition, no
Purchase Right may be exercised unless (a) a registration statement under the
Securities Act of 1933, as amended, shall at the time of exercise of the
Purchase Right be in effect with respect to the shares issuable upon exercise
of the Purchase Right, or (b) in the opinion of legal counsel to the Company,
the shares issuable upon exercise of the Purchase Right may be issued in
accordance with the terms of an applicable exemption from the registration
requirements of said Act. The inability of the Company to obtain from any
regulatory body having jurisdiction the authority, if any, deemed by the
Company's legal counsel to be necessary to the lawful issuance and sale of
any shares under the Plan shall relieve the Company of any liability in
respect of the failure to issue or sell such shares as to which such
requisite authority shall not have been obtained. As a condition to the
exercise of a Purchase Right, the Company may require the Participant to
satisfy any qualifications that may be necessary or appropriate, to evidence
compliance with any applicable law or regulation, and to make any
representation or warranty with respect thereto as may be requested by the
Company.

<PAGE>

         19.      LEGENDS. The Company may at any time place legends or other
identifying symbols referencing any applicable foreign, federal or state
securities law restrictions or any provision convenient in the administration
of the Plan on some or all of the certificates representing shares of Stock
issued under the Plan. The Participant shall, at the request of the Company,
promptly present to the Company any and all certificates representing shares
acquired pursuant to a Purchase Right in the possession of the Participant in
order to carry out the provisions of this Section. Unless otherwise specified
by the Company, legends placed on such certificates may include but shall not
be limited to the following:

                  "THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED BY
         THE CORPORATION TO THE REGISTERED HOLDER UPON THE PURCHASE OF SHARES
         UNDER AN EMPLOYEE STOCK PURCHASE PLAN AS DEFINED IN SECTION 423 OF
         THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. THE TRANSFER AGENT
         FOR THE SHARES EVIDENCED HEREBY SHALL NOTIFY THE CORPORATION
         IMMEDIATELY OF ANY TRANSFER OF THE SHARES BY THE REGISTERED HOLDER
         HEREOF MADE ON OR BEFORE __________, 19__. THE REGISTERED HOLDER
         SHALL HOLD ALL SHARES PURCHASED UNDER THE PLAN IN THE REGISTERED
         HOLDER'S NAME (AND NOT IN THE NAME OF ANY NOMINEE) PRIOR TO THIS
         DATE."

         20.      NOTIFICATION OF SALE OF SHARES. The Company may require the
Participant to give the Company prompt notice of any disposition of shares
acquired by exercise of a Purchase Right within two years from the date of
granting such Purchase Right or one year from the date of exercise of such
Purchase Right. The Company may require that until such time as a Participant
disposes of shares acquired upon exercise of a Purchase Right, the
Participant shall hold all such shares in the Participant's name (and not in
the name of any nominee) until the lapse of the time periods with respect to
such Purchase Right referred to in the preceding sentence. The Company may
direct that the certificates evidencing shares acquired by exercise of a
Purchase Right refer to such requirement to give prompt notice of disposition.

         21.      AMENDMENT OR TERMINATION OF THE PLAN. The Board may at any
time amend or terminate the Plan, except that (a) such termination shall not
affect Purchase Rights previously granted under the Plan, except as permitted
under the Plan, and (b) no amendment may adversely affect a Purchase Right
previously granted under the Plan (except to the extent permitted by the Plan
or as may be necessary to qualify the Plan as an employee stock purchase plan
pursuant to Section 423 of the Code or to obtain qualification or
registration of the shares of Stock under applicable foreign, federal or
state securities laws). In addition, an amendment to the Plan must be
approved by the stockholders of the Company within twelve (12) months of the
adoption of such amendment if such amendment would authorize the sale of more
shares than are authorized for issuance under the Plan or would change the
definition of the corporations that may be designated by the Board as
Participating Companies.

         22.      CONTINUATION OF INITIAL PLAN AS TO OUTSTANDING PURCHASE
RIGHTS. Any other provision of the Plan to the contrary notwithstanding, the
terms of the Initial Plan shall remain in effect and apply to all Purchase
Rights granted pursuant to the Initial Plan.

<PAGE>

         IN WITNESS WHEREOF, the undersigned Secretary of the Company
certifies that the foregoing sets forth the Zoran Corporation Amended and
Restated 1995 Employee Stock Purchase Plan as duly adopted by the Board of
Directors of the Company on January 24, 1996 and amended through June 18,
2000.


                                         ---------------------------------
                                         Secretary