**Exhibit10.3**

**ZORANCORPORATION**

**AMENDEDAND RESTATED**

**1995EMPLOYEE STOCK PURCHASE PLAN**

**(AsAmended Through June 29, 2001)**

             1.          **Establishment,Purpose and Term of Plan**.

                           1.1        ***Establishment.***  The Zoran Corporation 1995 Employee Stock Purchase Plan wasinitially established effective December 14, 1995 (the “**Effective Date**”), the effective date of theinitial registration by the Company of its Stock under Section 12 of theExchange Act (the “**Initial Plan**”).  The Initial Plan was amended and restated inits entirety as the Zoran Corporation Amended and Restated 1995 Employee StockPurchase Plan (the “**Plan**”)effective as of the date of commencement of the first Offering under the Planfollowing approval of the Plan by the stockholders of the Company onJune 6, 1996.

                           1.2        ***Purpose.*** The purpose of the Plan to provide Eligible Employees of theParticipating Company Group with an opportunity to acquire a proprietaryinterest in the Company through the purchase of Stock.  The Company intends that the Plan shallqualify as an “employee stock purchase plan” under Section 423 of the Code(including any amendments or replacements of such section), and the Plan shallbe so construed.

                           1.3        ***Term of Plan.***  The Plan shall continue in effect until the earlier of itstermination by the Board or the date on which all of the shares of Stockavailable for issuance under the Plan have been issued.

             2.          **Definitionsand Construction**.

                           2.1        ***Definitions***. Any term not expressly defined in the Plan but defined for purposes ofSection 423 of the Code shall have the same definition herein.  Whenever used herein, the following termsshall 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 administerthe Plan, “Board” also means such Committee(s).

                                        (b)        “**Code**”means the Internal Revenue Code of 1986, as amended, and any applicableregulations promulgated thereunder.

                                        (c)         “**Committee**”means a committee of the Board duly appointed to administer the Plan and havingsuch powers as shall be specified by the Board.  Unless the powers of the Committee have been specificallylimited, 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 anytime, subject to the terms of the Plan and any applicable limitations imposedby law.

                                        (d)        “**Company**”means Zoran Corporation, a Delaware corporation, or any successor corporationthereto.

                                        (e)         “**Compensation**”means, with respect to an Offering Period under the Plan, all amounts paid incash in the form of base salary during such Offering Period before deductionfor any contributions to any plan maintained by a Participating Company anddescribed 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 cashor any amounts directly or indirectly paid pursuant to the Plan or any otherstock purchase or stock option plan.

                                        (f)         “**EligibleEmployee**” means an Employee who meets the requirements set forth inSection 5 for eligibility to participate in the Plan.

                                        (g)        “**Employee**”means any person treated as an employee (including an officer or a Director whois also treated as an employee) in the records of a Participating Company andfor purposes of Section 423 of the Code; provided, however, that neitherservice as a Director nor payment of a director’s fee shall be sufficient toconstitute employment for purposes of the Plan.

                                        (h)        “**ExchangeAct**” means the Securities Exchange Act of 1934, as amended.

                                        (i)          “**FairMarket Value**” means, as of any date, if there is then a publicmarket for the Stock, the closing price of a share of Stock (or the mean of theclosing bid and asked prices of a share of Stock if the Stock is so reportedinstead) as reported on the National Association of Securities DealersAutomated Quotation (“**NASDAQ**”)System, the NASDAQ National Market System or such other national or regionalsecurities exchange or market system constituting the primary market for theStock.  If the relevant date does not fallon a day on which the Stock is trading on NASDAQ, the NASDAQ National MarketSystem or other national or regional securities exchange or market system, thedate on which the Fair Market Value shall be established shall be the last dayon which the Stock was so traded prior to the relevant date, or such otherappropriate day as shall be determined by the Board, in its solediscretion.  If there is then no publicmarket for the Stock, the Fair Market Value on any relevant date shall be asdetermined by the Board without regard to any restriction other than arestriction which, by its terms, will never lapse.  Notwithstanding the foregoing, the Fair Market Value per share ofStock on the Effective Date shall be deemed to be the public offering price setforth in the final prospectus filed with the Securities and Exchange Commissionin connection with the initial public offering of the Stock.

                                        (j)          “**Offering**”means an offering of Stock as provided in Section 6.

                                        (k)         “**OfferingDate**” means, for any Offering Period, the first day of such OfferingPeriod.

                                        (l)          “**OfferingPeriod**” means a period determined in accordance withSection 6.1.

                                        (m)        “**ParentCorporation**” means any present or future “parent corporation” of theCompany, as defined in Section 424(e) of the Code.

                                        (n)        “**Participant**”means an Eligible Employee participating in the Plan.

                                        (o)        “**ParticipatingCompany**” means the Company or any Parent Corporation or SubsidiaryCorporation which the Board determines should be included in the Plan.  The Board shall have the sole and absolutediscretion to determine from time to time what Parent Corporations orSubsidiary Corporations shall be Participating Companies.

                                        (p)        “**ParticipatingCompany Group**” means, at any point in time, the Company and allother corporations collectively which are then Participating Companies.

                                        (q)        “**PurchaseDate**” means, for any Purchase Period, the last day of such PurchasePeriod.

                                        (r)         “**PurchasePeriod**” means a period determined in accordance withSection 6.2.

                                        (s)         “**PurchasePrice**” means the price at which a share of Stock may be purchasedpursuant to the Plan, as determined in accordance with Section 9.

                                        (t)         “**PurchaseRight**”  means an optionpursuant to the Plan to purchase such shares of Stock as provided inSection 8 which may or may not be exercised during an OfferingPeriod.  Such option arises from theright of a Participant to withdraw such Participant’s accumulated payrolldeductions not previously applied to the purchase of Stock under the Plan (ifany) and terminate participation in the Plan or any Offering therein at anytime during an Offering Period.

                                        (u)        “**Stock**”means the common stock, par value $0.001, of the Company, as adjusted from timeto time in accordance with Section 4.2.

                                        (v)        “**SubsidiaryCorporation**” means any present or future “subsidiary corporation” ofthe Company, as defined in Section 424(f) of the Code.

                           2.2        ***Construction.***  Captions and titles contained herein are for convenience only andshall not affect the meaning or interpretation of any provision of thePlan.  Except when otherwise indicatedby the context, the singular shall include the plural, the plural shall includethe singular, and use of the term “or” shall include the conjunctive as well asthe 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 PurchaseRight shall be determined by the Board and shall be final and binding upon allpersons having an interest in the Plan or such Purchase Right.  Subject to the provisions of the Plan, theBoard shall determine all of the relevant terms and conditions of PurchaseRights granted pursuant to the Plan; provided, however, that all Participantsgranted Purchase Rights pursuant to the Plan shall have the same rights andprivileges within the meaning of Section 423(b)(5) of the Code.  All expenses incurred in connection with theadministration of the Plan shall be paid by the Company.

             4.          **SharesSubject to Plan**.

                           4.1        ***Maximum Number of Shares Issuable*.**  Subject to adjustment as provided inSection 4.2, the maximum aggregate number of shares of Stock that may beissued under the Plan shall be five hundred fifty thousand (550,000) and shallconsist of authorized but unissued or reacquired shares of the Stock, or anycombination thereof.  If an outstandingPurchase Right for any reason expires or is terminated or canceled, the sharesof Stock allocable to the unexercised portion of such Purchase Right shallagain be available for issuance under the Plan.

                           4.2        ***Adjustments for Changes in Capital Structure.***  In the event of any stock dividend, stocksplit, reverse stock split, recapitalization, combination, reclassification orsimilar change in the capital structure of the Company, or in the event of anymerger (including a merger effected for the purpose of changing the Company’sdomicile), sale of assets or other reorganization in which the Company is aparty, appropriate adjustments shall be made in the number and class of sharessubject to the Plan, to the Offering Share Limit set forth in Section 8.1 andto each Purchase Right and in the Purchase Price.

             5.          **Eligibility**.

                           5.1        ***Employees Eligible to Participate.***  Any Employee of a Participating Company iseligible to participate in the Plan except the following:

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

                                        (b)        Employees who are customarily employedby the Participating Company Group for not more than five (5) months in anycalendar year; and

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

                           5.2        ***Leased Employees Excluded.***  Notwithstanding anything herein to thecontrary, any individual performing services for a Participating Company solelythrough 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 beimplemented by sequential Offerings of approximately twenty-four (24) monthsduration (an “**Offering Period**”);provided, however that the first Offering Period shall commence on theEffective Date and end on October 31, 1997 (the “**Initial Offering Period**”).  Subsequent Offerings shall commence on thefirst days of May and November of each year and end on the last days of thesecond April and October, respectively, occurring thereafter.  Notwithstanding the foregoing, the Board mayestablish a different term for one or more Offerings or different commencing orending dates for such Offerings; provided, however, that no Offering may exceeda term of twenty-seven (27) months.  AnEmployee who becomes an Eligible Employee after an Offering Period hascommenced shall not be eligible to participate in such Offering but mayparticipate in any subsequent Offering provided such Employee is still anEligible Employee as of the commencement of any such subsequent Offering.  Eligible Employees may not participate inmore than one Offering at a time.  Inthe 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 orlast day, as the case may be, of the Offering Period.

                           6.2        ***Purchase Periods.***  Each Offering Period shall consist of four (4) consecutivepurchase periods of approximately six (6) months duration (individually, a “**Purchase Period**”).  The Purchase Period commencing on theOffering Date of the Initial Offering Period shall end on April 30, 1996.  A Purchase Period commencing on the firstday of May shall end on the last day of the next following October.  A Purchase Period commencing on the firstday of November shall end on the last day of the next following April.  Notwithstanding the foregoing, the Board mayestablish a different term for one or more Purchase Periods or differentcommencing or ending dates for such Purchase Periods.  In the event the first or last day of a Purchase Period is not abusiness day, the Company shall specify the business day that will be deemedthe first or last day, as the case may be, of the Purchase Period.

                           6.3        ***Governmental Approval; Stockholder Approval.***  Notwithstanding any other provision of thePlan to the contrary, any Purchase Right granted pursuant to the Plan shall besubject to (a) obtaining all necessary governmental approvals orqualifications of the sale or issuance of the Purchase Rights or the shares ofStock and (b) obtaining stockholder approval of the Plan.  Notwithstanding the foregoing, stockholderapproval shall not be necessary in order to grant any Purchase Right granted inthe Plan’s Initial Offering Period; provided, however, that the exercise of anysuch Purchase Right shall be subject to obtaining stockholder approval of thePlan.

             7.          **Participationin the Plan**.

                           7.1        ***Initial Participation.***  An Eligible Employee shall become aParticipant on the first Offering Date after satisfying the eligibilityrequirements of Section 5 and delivering to the Company’s payroll officeor other office designated by the Company not later than the close of businessfor such office on the last business day before such Offering Date (the “**Subscription Date**”) a subscriptionagreement indicating the Employee’s election to participate in the Plan andauthorizing payroll deductions.  AnEligible Employee who does not deliver a subscription agreement to theCompany’s payroll or other designated office on or before the Subscription Dateshall not participate in the Plan for that Offering Period or for anysubsequent Offering Period unless such Employee subsequently enrolls in thePlan by filing a subscription agreement with the Company by the SubscriptionDate for such subsequent Offering Period. The Company may, from time to time, change the Subscription Date asdeemed advisable by the Company in its sole discretion for properadministration of the Plan.

                           7.2        ***Continued Participation.***  A Participant shall automaticallyparticipate in the Offering Period commencing immediately after the finalPurchase Date of each Offering Period in which the Participant participatesuntil such time as such Participant (a) ceases to be an Eligible Employee,(b) withdraws from the Plan pursuant to Section 13.2 or (c) terminatesemployment as provided in Section 14. If a Participant automatically may participate in a subsequent OfferingPeriod pursuant to this Section 7.2, then the Participant is not requiredto file any additional subscription agreement for such subsequent Offering Periodin order to continue participation in the Plan.   However, a Participant may file a subscription agreement withrespect to a subsequent Offering Period if the Participant desires to changeany of the Participant’s elections contained in the Participant’s theneffective subscription agreement.

             8.          **Rightto Purchase Shares**.

                           8.1        ***Purchase Right.***  Except as set forth below, during an Offering Period eachParticipant in such Offering Period shall have a Purchase Right consisting ofthe right to purchase that number of whole shares of Stock arrived at bydividing Fifty Thousand Dollars ($50,000) by the Fair Market Value of a shareof Stock on the Offering Date of such Offering Period; provided, however, thatsuch number shall not exceed 5,000 shares (the “**Offering Share Limit**”). Shares of Stock may only be purchased through a Participant’s payrolldeductions pursuant to Section 10.

                           8.2        ***Pro Rata Adjustment of Purchase Right.***  Notwithstanding the foregoing, if the Boardshall establish an Offering Period of less than twenty-three and one-half (231⁄2)months in duration or more than twenty-four and one-half (241⁄2) months induration, (a) the dollar amount in Section 8.1 shall be determined bymultiplying $2,083.33 by the number of months in the Offering Period androunding to the nearest whole dollar, and (b) the Offering Share Limitshall be determined by multiplying 208.33 shares by the number of months in theOffering 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.          **PurchasePrice**.  The PurchasePrice at which each share of Stock may be acquired in a given Offering Periodpursuant to the exercise of all or any portion of a Purchase Right grantedunder the Plan shall be set by the Board; provided, however, that the PurchasePrice 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 theOffering Period, or (b) the Fair Market Value of a share of Stock on thePurchase Date of the Offering Period. Unless otherwise provided by the Board prior to the commencement of anOffering Period, the Purchase Price for that Offering Period shall be eighty-fivepercent (85%) of the lesser of (a) the Fair Market Value of a share ofStock on the Offering Date of the Offering Period, or (b) the Fair MarketValue of a share of Stock on the Purchase Date of the Offering Period.

             10.        **Accumulationof Purchase Price through Payroll Deduction**.  Shares of Stock which are acquired pursuantto the exercise of all or any portion of a Purchase Right for an OfferingPeriod may be paid for only by means of payroll deductions from theParticipant’s Compensation accumulated during the Offering Period.  Except as set forth below, the amount ofCompensation to be deducted from a Participant’s Compensation during each payperiod shall be determined by the Participant’s subscription agreement.

                           10.1      ***Commencement of Payroll Deductions.***  Payroll deductions shall commence on thefirst payday following the Offering Date and shall continue to the end of theOffering Period unless sooner altered or terminated as provided in the Plan.

                           10.2      ***Limitations on Payroll Deductions.***  The amount of payroll deductions withrespect to the Plan for any Participant during any pay period shall be in onepercent (1%) increments not to exceed ten percent (10%) of the Participant’sCompensation for such pay period. Notwithstanding the foregoing, the Board may change the limits onpayroll deductions effective as of a future Offering Date, as determined by theBoard.  Amounts deducted fromCompensation shall be reduced by any amounts contributed by the Participant andapplied to the purchase of Company stock pursuant to any other employee stock purchaseplan qualifying under Section 423 of the Code.

                           10.3      ***Election to Change or Stop Payroll Deductions.***  During an Offering Period, a Participant mayelect to increase or decrease the amount deducted or stop deductions from hisor her Compensation by filing an amended subscription agreement with theCompany 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 payperiod for which such election is to be effective; however, the Company maychange such Change Notice Date from time to time.  A Participant who elects to decrease the rate of his or herpayroll deductions to zero percent (0%) shall nevertheless remain a Participantin the current Offering Period unless such Participant subsequently withdrawsfrom the Offering or the Plan as provided in Sections 13.1 and 13.2,respectively, or is automatically withdrawn from the Offering as provided inSection 13.4.

                           10.4      ***Participant Accounts.***  Individual Plan accounts shall be maintainedfor each Participant.  All payrolldeductions from a Participant’s Compensation shall be credited to such accountand shall be deposited with the general funds of the Company.  All payroll deductions received or held bythe 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’sCompensation 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 forparticipation in an Offering, (a) limitations on the frequency or numberof changes in the rate of payroll deduction during an Offering, (c) anexchange ratio applicable to amounts withheld in a currency other than U.S.dollars, (d) payroll deduction in excess of or less than the amountdesignated by a Participant in order to adjust for delays or mistakes in theCompany’s processing of subscription agreements, (e) the date(s) andmanner by which the Fair Market Value of a share of Stock is determined forpurposes of administration of the Plan, or (vi) such other limitations orprocedures as deemed advisable by the Company in the Company’s sole discretionwhich are consistent with the Plan and in accordance with the requirements ofSection 423 of the Code.

             11.        **Purchaseof 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 participationin the Offering has not terminated on or before such Purchase Date shallautomatically acquire pursuant to the exercise of the Participant’s PurchaseRight the number of whole shares of Stock arrived at by dividing the totalamount of the Participant’s accumulated payroll deductions for the PurchasePeriod by the Purchase Price; provided, however, in no event shall the numberof shares purchased by the Participant during an Offering Period exceed thenumber of shares subject to the Participant’s Purchase Right.  No shares of Stock shall be purchased on aPurchase Date on behalf of a Participant whose participation in the Offering orthe Plan has terminated on or before such Purchase Date.

                           11.2      ***Return of Cash Balance.***  Any cash balance remaining in theParticipant’s Plan account shall be refunded to the Participant as soon aspracticable after the Purchase Date.  Inthe event the cash to be returned to a Participant pursuant to the precedingsentence is an amount less than the amount necessary to purchase a whole shareof Stock, the Company may establish procedures whereby such cash is maintainedin the Participant’s Plan account and applied toward the purchase of shares ofStock in the subsequent Purchase Period or Offering Period.

                           11.3      ***Tax Withholding.***  At the time a Participant’s Purchase Right is exercised, in wholeor in part, or at the time a Participant disposes of some or all of the sharesof Stock he or she acquires under the Plan, the Participant shall make adequateprovision for the foreign, federal, state and local tax withholding obligationsof the Participating Company Group, if any, which arise upon exercise of thePurchase Right or upon such disposition of shares, respectively.  The Participating Company Group may, butshall not be obligated to, withhold from the Participant’s compensation theamount necessary to meet such withholding obligations.

                           11.4      ***Expiration of Purchase Right.***  Any portion of a Participant’s PurchaseRight remaining unexercised after the end of the Offering Period to which suchPurchase Right relates shall expire immediately upon the end of such OfferingPeriod.

             12.        **Limitationson Purchase of Shares; Rights as a Stockholder**.

                           12.1      ***Fair Market Value Limitation.***  Notwithstanding any other provision of thePlan, no Participant shall be entitled to purchase shares of Stock under thePlan (or any other employee stock purchase plan which is intended to meet therequirements of Section 423 of the Code sponsored by the Company or aParent Corporation or Subsidiary Corporation) at a rate which exceeds $25,000in Fair Market Value, which Fair Market Value is determined for sharespurchased during a given Offering Period as of the Offering Date for suchOffering Period (or such other limit as may be imposed by the Code), for eachcalendar year in which the Participant participates in the Plan (or any otheremployee stock purchase plan described in this sentence).

                           12.2      ***Pro Rata Allocation.*** In the event the number of shares of Stockwhich might be purchased by all Participants in the Plan exceeds the number ofshares of Stock available in the Plan, the Company shall make a pro rataallocation of the remaining shares in as uniform a manner as shall bepracticable and as the Company shall determine to be equitable.

                           12.3      ***Rights as a Stockholder and Employee.***  A Participant shall have no rights as astockholder by virtue of the Participant’s participation in the Plan until thedate of the issuance of a stock certificate for the shares of Stock beingpurchased pursuant to the exercise of the Participant’s Purchase Right.  No adjustment shall be made for cashdividends or distributions or other rights for which the record date is priorto the date such stock certificate is issued. Nothing herein shall confer upon a Participant any right to continue inthe employ of the Participating Company Group or interfere in any way with anyright of the Participating Company Group to terminate the Participant’semployment at any time.

             13.        **Withdrawal**.

                           13.1      ***Withdrawal From an Offering.***  A Participant may withdraw from an Offeringby signing and delivering to the Company’s payroll or other designated office awritten notice of withdrawal on a form provided by the Company for suchpurpose.  Such withdrawal may be electedat any time prior to the end of an Offering Period; provided, however, if aParticipant withdraws after a Purchase Date, the withdrawal shall not affectshares of Stock acquired by the Participant on such Purchase Date.  Unless otherwise indicated, withdrawal froman Offering shall not result in a withdrawal from the Plan or any succeedingOffering therein.  By withdrawing froman Offering effective as of the close of a given Purchase Date, a Participantmay have shares of Stock purchased on such Purchase Date and immediatelycommence participation in the new Offering commencing immediately after suchPurchase Date.  A Participant isprohibited from again participating in an Offering at any time followingwithdrawal from such Offering.  TheCompany may impose, from time to time, a requirement that the notice ofwithdrawal be on file with the Company’s payroll office or other designatedoffice for a reasonable period prior to the effectiveness of the Participant’swithdrawal from an Offering.

                           13.2      ***Withdrawal from the Plan.***  A Participant may withdraw from the Plan bysigning and delivering to the Company’s payroll office or other designatedoffice a written notice of withdrawal on a form provided by the Company forsuch purpose.  Withdrawals made after aPurchase Date shall not affect shares of Stock acquired by the Participant onsuch Purchase Date.  In the event aParticipant voluntarily elects to withdraw from the Plan, the Participant maynot resume participation in the Plan during the same Offering Period, but mayparticipate in any subsequent Offering under the Plan by again satisfying therequirements of Sections 5 and 7.1. The Company may impose, from time to time, a requirement that the noticeof withdrawal be on file with the Company’s payroll office or other designatedoffice for a reasonable period prior to the effectiveness of the Participant’swithdrawal from the Plan.

                           13.3      ***Return of Payroll Deductions.***  Upon a Participant’s withdrawal from anOffering or the Plan pursuant to Sections 13.1 or 13.2, respectively, theParticipant’s accumulated payroll deductions which have not been applied towardthe purchase of shares of Stock shall be returned as soon as practicable afterthe withdrawal, without the payment of any interest, to the Participant, andthe Participant’s interest in the Offering or the Plan, as applicable, shallterminate.  Such accumulated payrolldeductions 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 Stockon a Purchase Date of an Offering (other than the final Purchase Date of suchOffering) is less than the Fair Market Value of a share of Stock on theOffering Date for such Offering, then every Participant shall automatically(a) be withdrawn from such Offering at the close of such Purchase Date andafter the acquisition of shares of Stock for such Purchase Period and(b) be enrolled in the Offering commencing on the first business daysubsequent to such Purchase Period.  AParticipant may elect not to be automatically withdrawn from an Offering Periodpursuant to this Section 13.4 by delivering to the Company not later thanthe close of business on the last day before the Purchase Date a written noticeindicating 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 accumulatedin his or her Plan account as of such Purchase Date applied to purchase sharesof Stock under the Plan, and (a) to waive his or her right to withdrawfrom the Offering or the Plan and (b) to waive his or her right toincrease, decrease, or cease payroll deductions under the Plan from his or herCompensation during the Purchase Period ending on such Purchase Date.  Such election shall be made in writing on aform provided by the Company for such purpose and must be delivered to theCompany not later than the close of business on the day preceding the datewhich is six (6) months before the Purchase Date for which such election is tofirst be effective.

             14.        **Terminationof Employment or Eligibility.** Termination of a Participant’s employment with the Company for anyreason, including retirement, disability or death or the failure of a Participantto remain an Eligible Employee, shall terminate the Participant’s participationin the Plan immediately.  In such event,the payroll deductions credited to the Participant’s Plan account since thelast Purchase Date shall, as soon as practicable, be returned to theParticipant or, in the case of the Participant’s death, to the Participant’slegal representative, and all of the Participant’s rights under the Plan shallterminate.  Interest shall not be paid onsums returned to a Participant pursuant to this Section 14.  A Participant whose participation has beenso terminated may again become eligible to participate in the Plan by againsatisfying the requirements of Sections 5 and 7.1.

             **15.        Transferof Control**.

                           15.1      ***Definitions.***

                                        (a)         An “**OwnershipChange Event**” shall be deemed to have occurred if any of thefollowing occurs with respect to the Company: (i) the direct or indirect sale or exchange in a single or seriesof 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 consolidationin which the Company a party; (iii) the sale, exchange, or transfer of allor substantially all of the assets of the Company; or (iv) a liquidationor dissolution of the Company.

                                        (b)        A “**Transferof Control**” shall mean an Ownership Change Event or a series ofrelated Ownership Change Events (collectively, the “**Transaction**”) wherein the stockholders of the Companyimmediately before the Transaction do not retain immediately after theTransaction, in substantially the same proportions as their ownership of sharesof the Company’s voting stock immediately before the Transaction, direct orindirect beneficial ownership of more than fifty percent (50%) of the totalcombined voting power of the outstanding voting stock of the Company or thecorporation or corporations to which the assets of the Company were transferred(the “**Transferee Corporation(s)**”),as the case may be.  For purposes of thepreceding sentence, indirect beneficial ownership shall include, withoutlimitation, an interest resulting from ownership of the voting stock of one ormore corporations which, as a result of the Transaction, own the Company or theTransferee Corporation(s), as the case may be, either directly or through oneor more subsidiary corporations.  TheBoard shall have the right to determine whether multiple sales or exchanges ofthe voting stock of the Company or multiple Ownership Change Events arerelated, 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, thesurviving, continuing, successor, or purchasing corporation or parentcorporation thereof, as the case may be (the “**AcquiringCorporation**”), may assume the Company’s rights and obligations underthe Plan or substitute substantially equivalent Purchase Rights for stock ofthe Acquiring Corporation.  If theAcquiring Corporation elects not to assume or substitute for the outstandingPurchase Rights, the Board may, in its sole discretion and notwithstanding anyother provision herein to the contrary, adjust the Purchase Date of the thencurrent Purchase Period to a date on or before the date of the Transfer ofControl, but shall not adjust the number of shares of Stock subject to anyPurchase Right.  All Purchase Rightswhich are neither assumed or substituted for by the Acquiring Corporation inconnection with the Transfer of Control nor exercised as of the date of theTransfer of Control shall terminate and cease to be outstanding effective as ofthe date of the Transfer of Control. Notwithstanding the foregoing, if the corporation the stock of which issubject to the outstanding Purchase Rights immediately prior to an OwnershipChange Event described in Section 15.1(a)(i) constituting a Transfer of Controlis the surviving or continuing corporation and immediately after such OwnershipChange Event less than fifty percent (50%) of the total combined voting powerof its voting stock is held by another corporation or by other corporationsthat 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 otherwiseprovides in its sole discretion.

             16.        **Nontransferabilityof Purchase Rights**.  APurchase Right may not be transferred in any manner otherwise than by will orthe laws of descent and distribution and shall be exercisable during the lifetimeof the Participant only by the Participant. The Company, in its absolute discretion, may impose such restrictions onthe transferability of the shares purchasable upon the exercise of a PurchaseRight as it deems appropriate and any such restriction shall be set forth inthe respective subscription agreement and may be referred to on thecertificates evidencing such shares.

             17.        **Reports**.  Each Participant who exercised all or partof his or her Purchase Right for a Purchase Period shall receive, as soon aspracticable after the Purchase Date of such Purchase Period, a report of suchParticipant’s Plan account setting forth the total payroll deductionsaccumulated, the number of shares of Stock purchased, the Purchase Price forsuch shares, the date of purchase and the remaining cash balance to be refundedor retained in the Participant’s Plan account pursuant to Section 11.2, ifany.  Each Participant shall be providedinformation concerning the Company equivalent to that information generallymade available to the Company’s common stockholders.

             18.        **Restrictionon Issuance of Shares**. The issuance of shares under the Plan shall be subject to compliancewith all applicable requirements of foreign, federal or state law with respectto such securities.  A Purchase Rightmay not be exercised if the issuance of shares upon such exercise wouldconstitute a violation of any applicable foreign, federal or state securitieslaws or other law or regulations.  Inaddition, no Purchase Right may be exercised unless (a) a registrationstatement under the Securities Act of 1933, as amended, shall at the time ofexercise of the Purchase Right be in effect with respect to the shares issuableupon exercise of the Purchase Right, or (b) in the opinion of legal counselto the Company, the shares issuable upon exercise of the Purchase Right may beissued in accordance with the terms of an applicable exemption from theregistration requirements of said Act. The inability of the Company to obtain from any regulatory body havingjurisdiction the authority, if any, deemed by the Company’s legal counsel to benecessary to the lawful issuance and sale of any shares under the Plan shallrelieve the Company of any liability in respect of the failure to issue or sellsuch shares as to which such requisite authority shall not have beenobtained.  As a condition to theexercise of a Purchase Right, the Company may require the Participant tosatisfy any qualifications that may be necessary or appropriate, to evidencecompliance with any applicable law or regulation, and to make anyrepresentation or warranty with respect thereto as may be requested by theCompany.

             19.        **Legends**.  The Company may at any time place legends orother identifying symbols referencing any applicable foreign, federal or statesecurities law restrictions or any provision convenient in the administrationof the Plan on some or all of the certificates representing shares of Stockissued under the Plan.  The Participantshall, at the request of the Company, promptly present to the Company any andall certificates representing shares acquired pursuant to a Purchase Right inthe possession of the Participant in order to carry out the provisions of thisSection.  Unless otherwise specified bythe Company, legends placed on such certificates may include but shall not belimited to the following:

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

             20.        **Notificationof Sale of Shares.**  TheCompany may require the Participant to give the Company prompt notice of anydisposition of shares acquired by exercise of a Purchase Right within two yearsfrom the date of granting such Purchase Right or one year from the date ofexercise of such Purchase Right.  TheCompany may require that until such time as a Participant disposes of sharesacquired upon exercise of a Purchase Right, the Participant shall hold all suchshares in the Participant’s name (and not in the name of any nominee) until thelapse of the time periods with respect to such Purchase Right referred to inthe preceding sentence.  The Company maydirect that the certificates evidencing shares acquired by exercise of aPurchase Right refer to such requirement to give prompt notice of disposition.

             21.        **Amendmentor 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 grantedunder the Plan, except as permitted under the Plan, and (b) no amendmentmay adversely affect a Purchase Right previously granted under the Plan (exceptto the extent permitted by the Plan or as may be necessary to qualify the Planas an employee stock purchase plan pursuant to Section 423 of the Code orto obtain qualification or registration of the shares of Stock under applicableforeign, federal or state securities laws). In addition, an amendment to the Plan must be approved by thestockholders of the Company within twelve (12) months of the adoption of suchamendment if such amendment would authorize the sale of more shares than are authorized for issuance under the Plan or would change the definition of thecorporations that may be designated by the Board as Participating Companies.

             22.        **Continuationof Initial Plan as to Outstanding Purchase Rights**.  Any other provision of the Plan to thecontrary notwithstanding, the terms of the Initial Plan shall remain in effectand apply to all Purchase Rights granted pursuant to the Initial Plan.

             IN WITNESS WHEREOF, the undersigned Secretary of theCompany certifies that the foregoing sets forth the Zoran Corporation Amendedand Restated 1995 Employee Stock Purchase Plan as duly adopted by the Board ofDirectors of the Company on January 24, 1996 and amended through April 17,2001.

 

                                                                                                                                                                

                                                                                             Secretary

PLANHISTORY

| October 13, 1995  | Board adopts Initial Plan, with an initial  reserve of 150,000 shares (post the 1:3 reverse stock split on 12/14/95).                                                                                                                                                                                                                                                                                                                                               |
|-------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| December 14, 1995 | Effective date of stockholder action by  consent without meeting, approving Initial Plan, with an initial reserve of  150,000 shares (post the 1:3 reverse stock split on 12/14/95).                                                                                                                                                                                                                                                                                |
| December 14, 1995 | The Plan initially was effective December 14,  1995, the effective date of the initial registration by the Company of its  Stock under Section 12 of the Exchange Act.                                                                                                                                                                                                                                                                                         |
| January 24, 1996  | Subject to stockholder approval, Board amends  and restates the Plan to increase the number of shares subject to a purchase  right and to eliminate a limit on the number of shares purchasable in a  calendar year less than the calendar year limit imposed by Section 423  of the Code.  The amended and restated  Plan will be effective as of the date of commencement of the first offering  under the Plan following approval by the stockholders. |
| May 23, 1996      | Stockholders approve Plan, as amended January 24,  1996.                                                                                                                                                                                                                                                                                                                                                                                                       |
| April 23, 1997    | Board amends Plan to increase share reserve by  150,000 shares to 300,000 shares and to permit increases in the rate of  payroll deductions.                                                                                                                                                                                                                                                                                                                        |
| June 6, 1997      | Stockholders approve amendment increasing  share reserve to 300,000 shares.                                                                                                                                                                                                                                                                                                                                                                                         |
| __________, 1999  | Board amends Plan to increase share reserve by  100,000 shares to 400,000 shares.                                                                                                                                                                                                                                                                                                                                                                                   |
| July 16, 1999     | Stockholders approve amendment increasing  share reserve to 400,000 shares.                                                                                                                                                                                                                                                                                                                                                                                         |
| June 18, 2000     | Board amends Plan to increase share reserve by  100,000 shares to 500,000 shares.                                                                                                                                                                                                                                                                                                                                                                                   |
| July ___, 2000    | Stockholders approve amendment increasing  share reserve to 500,000 shares.                                                                                                                                                                                                                                                                                                                                                                                         |
| April 17, 2001    | Board amends Plan to increase share reserve by  50,000 shares to 550,000 shares.                                                                                                                                                                                                                                                                                                                                                                                    |
| June 29, 2001     | Stockholders approve amendment increasing  share reserve to 550,000 shares.                                                                                                                                                                                                                                                                                                                                                                                         |

**ZORANCORPORATION1995 EMPLOYEE STOCK PURCHASE PLAN**

**SUBSCRIPTIONAGREEMENT**

o         Original Application for participationcommencing with the Offering Period beginning _________________________, 200__.

o         Change in Percentage of PayrollDeductions effective with the pay period ending _________________________,200__.

             I hereby elect to participate inthe 1995 Employee Stock Purchase Plan (the “**Plan**”) of Zoran Corporation(the “**Company**”)and subscribe to purchase shares of the Company’s common stock as determined inaccordance with the terms of the Plan.

             I hereby authorize payrolldeductions in the amount of                percent (in 1%increments not to exceed 10%) of my “**Compensation**” (as defined in the Plan) fromeach paycheck throughout the “**Offering Period**” (as defined in the Plan)in accordance with the terms of the Plan. I understand that these payroll deductions will be accumulated for thepurchase of shares of common stock of the Company at the applicable purchaseprice determined in accordance with the Plan. I further understand that, except as otherwise set forth in the Plan,shares will be purchased for me automatically on the last day of each PurchasePeriod unless I withdraw from the Plan or from the Offering by giving writtennotice to the Company or unless I terminate employment.

             I further understand that I willautomatically participate in each subsequent Offering which commencesimmediately after the last day of an Offering in which I am participating underthe Plan until such time as I file with the Company a notice of withdrawal fromthe Plan on such form as may be established from time to time by the Company orI terminate employment.

             Shares purchased for me under thePlan should be issued in the name set forth below.  (I understand that shares may be issued either in my name aloneor together with my spouse as community property or in joint tenancy.)
| NAME:                      |
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| ADDRESS:                   |
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| MY SOCIAL SECURITY NUMBER: |
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             I hereby authorize withholding frommy compensation in order to satisfy the foreign, federal, state and local taxwithholding obligations, if any, which may arise upon my purchase of sharesunder the Plan and/or upon my disposition of shares I acquired under the Plan.  I hereby agree that until I dispose of theshares, unless otherwise permitted by the Company, I will hold all shares Iacquire under the Plan in the name entered above (and not in the name of anynominee) for at least two (2) years from the first day of the Offering Periodin which, and at least one (1) year from the Purchase Date on which, I acquiredsuch shares.  I further agree that Iwill promptly notify the Chief Financial Officer of the Company in writing ofany transfer of such shares prior to the end of the periods referred to in thepreceding sentence.

             I am familiar with the provisionsof the Plan and hereby agree to participate in the Plan subject to all of theprovisions thereof.  I understand thatthe Board of Directors of the Company reserves the right to amend the Plan andmy right to purchase stock under the Plan as may be necessary to qualify thePlan as an employee stock purchase plan as defined in Section 423 of theInternal Revenue Code of 1986, as amended, or to obtain qualification orregistration of the Company’s common stock to be issued out of the Plan underapplicable foreign, federal and state securities laws.  I understand that the effectiveness of thissubscription agreement is dependent upon my eligibility to participate in thePlan.
| Date: ________________________ | Signature:  ______________________________________________     |
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|                                | Name Printed  ___________________________________________ |

**ZORANCORPORATION1995 EMPLOYEE STOCK PURCHASE PLANNOTICE OF WITHDRAWAL**

             I hereby elect to withdraw from theoffering of the common stock of Zoran Corporation (the “**Company**”) under the Company’s1995 Employee Stock Purchase Plan (the “**Plan**”) which began on_________________________, 200__ and in which I am currently participating (the“**CurrentOffering**”).

**             Make one election under section A and one electionunder section B:**

A.         Current Offering.  As to my participation in the currentpurchase period (the “Current Purchase Period”) of the Current Offering underthe Plan, I elect as follows (check one):

o         1.          Ielect to terminate my participation in the Current Purchase Period immediately.

             I hereby request that all payrolldeductions credited to my account under the Plan (if any) not previously usedto purchase shares under the Plan shall not be used to purchase shareson the last day of the Current Purchase Period.  Instead, I request that all such amounts be paid to me as soon aspracticable.  I understand that thiselection immediately terminates my interest in the Current Offering.

o         2.          Ielect to terminate my participation in the Current Offering following mypurchase of shares on the last day of the Current Purchase Period.

             I hereby request that all payrolldeductions credited to my account under the Plan (if any) not previously usedto purchase shares under the Plan shall be used to purchase shares on the lastday of the Current Purchase Period.  Iunderstand that this election will terminate my interest in the CurrentOffering immediately following such purchase. I request that any cash balance remaining in my account under the Planafter my purchase of shares be returned to me as soon as practicable.

             I understand that if no election ismade as to participation in the Current Offering under the Plan, I will bedeemed to have elected to participate in the Current Offering.

B.          Future Offerings.  As to my participation in future offeringsof common stock under the Plan, I elect as follows (check one):

o         1.          Ielect to participate in future offerings under the Plan.

             I understand that by making thiselection I will participate in the next offering under the Plan commencingsubsequent to the Current Offering, and in each subsequent offering commencingimmediately after the last day of an offering in which I participate, untilsuch time as I elect to withdraw from the Plan or from any such subsequentoffering.

o         2.          Ielect not to participate in future offerings under the Plan.

             I understand that by making thiselection I terminate my interest in the Plan and that no further payrolldeductions will be made unless I elect in accordance with the Plan to become aparticipant in another offering under the Plan.

             I understand that if no election ismade as to participation in future offerings under the Plan, I will be deemedto have elected to participate in such future offerings.

Date:                                                                      Signature:                                                                                                           

                                                                               Name Printed: