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                              EMPLOYMENT AGREEMENT

                                                October 19, 1999

CONFIDENTIAL

Mr. David Krall
c/o Avid Technology, Inc.
Avid Technology Park
One Park West
Tewksbury, MA 01876

Dear David:

      Continuity of management of Avid Technology,  Inc.  ("Avid") is a critical
factor to the continued  growth and success of Avid. The Avid Board of Directors
believes  that it is in the  best  interest  of the  Company  to  reinforce  and
encourage the continued attention and dedication of key members of management to
their assigned duties.

      In  consideration of the mutual promises  contained in this letter,  it is
hereby  agreed that Avid shall  provide to you, and that you shall  receive from
Avid, the benefits set forth in this letter (the "Agreement") if your employment
with  Avid,  and  its  subsidiaries,  is  terminated  during  the  term  of this
Agreement.

1.    Purpose

      This Agreement  establishes certain special  arrangements  relating to the
      termination  of your  employment  with Avid for any reason other than: (i)
      your becoming  totally and  permanently  disabled under the Avid long-term
      disability plan or policy, or (ii) your death.

2.    Term of Agreement

      This Agreement  shall become  effective on the date hereof (the "Effective
      Date")  and  shall  terminate  one  year  thereafter.  The  term  shall be
      automatically  extended for  successive  one-year  periods after the first
      anniversary,  unless 30 days' advance written notice is given by you or by
      Avid terminating this Agreement as of any anniversary date.

3.    Termination of Employment

      Your  employment may be terminated in accordance with any of the following
      paragraphs,  but only upon one (1) month's  advance  written notice (which
      period shall be referred to in this Agreement as the "Notice Period"). The
      expiration of the Notice Period shall be your "Date of Termination."

      (a)  Involuntary  Termination  Without  Cause.  Avid  may  terminate  your
      employment  without Cause (as defined below).  In such an event, you shall
      continue to receive your full base salary during the Notice  Period.  Upon
      your Date of Termination, you shall be entitled to those benefits provided
      under Section 4.

      (b) Involuntary  Termination for Cause. Avid may terminate your employment
      for "Cause" by written  notice  setting  forth the Cause for  termination.
      "Cause"  means a  willful  engaging  in gross  misconduct  materially  and
      demonstrably injurious to Avid or the willful and continued failure by you
      substantially to perform your duties with the Company (other than any such
      failure  resulting from your incapacity due to physical or mental illness)
      after a written demand for substantial  performance is delivered to you by
      the Chief Executive  Officer which  specifically  identifies the manner in
      which the Chief Executive Officer believes that you have not substantially
      performed your duties. "Willful" means an act or omission in bad faith and
      without  reasonable belief that such act or omission was in or not opposed
      to the best interests of Avid. Upon your Date of Termination, you shall be
      entitled only to those benefits provided under Section 5.

      (c)  Voluntary  Termination  without  Good  Reason.  You  may  voluntarily
      terminate your employment  without Good Reason (as defined below). In such
      an event,  you shall  continue  to  receive  your  full  base  salary  and
      Employment  Benefits during the Notice Period provided you  satisfactorily
      perform your duties during the Notice  Period,  unless you are relieved of
      those duties by Avid. Upon your Date of Termination, you shall be entitled
      only to those benefits provided under Section 5.

      (d) Voluntary  Termination with Good Reason. You may voluntarily terminate
      your employment  with Good Reason.  "Good Reason" shall mean a significant
      diminution  in your  duties or  responsibilities  that  results in your no
      longer serving as President and Chief Operating Officer of the Company. In
      such an event,  you shall  continue  to receive  your full base salary and
      Employment Benefits during the Notice Period,  provided you satisfactorily
      perform your duties during the Notice  Period,  unless you are relieved of
      those duties by Avid. Upon your Date of Termination, you shall be entitled
      to those benefits provided under Section 4.

4.    Special Severance Benefits

      If your employment with Avid is  involuntarily  terminated by Avid without
      Cause  pursuant  to Section  3(a) or by you for Good  Reason  pursuant  to
      Section 3(d), then you shall receive the following benefits as long as you
      continue to comply with your obligations under Section 8 of this Agreement
      and any  Invention  and  Nondisclosure  Agreement  (or similar  agreement)
      between you and the Company:

      (a) Your base salary  shall be  continued in effect for a period of twelve
      (12)  months  from  your  Date of  Termination  (hereinafter  called  your
      "Severance  Pay Period").  Avid will also pay you,  during the  thirteenth
      through  twenty-fourth  months  following  termination,  on a semi-monthly
      basis,  the  amount  by which  your  monthly  base  salary  at the Date of
      Termination exceeds your monthly compensation from your new employer;

      (b) You will  receive  incentive  compensation  payments  in an  aggregate
      amount  equal to your  target  award  for the  calendar  year  immediately
      preceding  the  calendar  year in which your Date of  Termination  occurs,
      payable in equal semi-monthly  installments during the 12 months following
      the  Date of  Termination.  You  shall  have  no  right  to any  pro-rated
      incentive compensation in respect of the year of termination;

      (c)  Notwithstanding any provision to the contrary in any Avid stock plan,
      or under the terms of any grant,  award  agreement or form for  exercising
      any right  under any such  plan,  any stock  options or  restricted  stock
      awards held by you as of the Date of Termination shall become  exercisable
      or vested,  as the case may be, as to an additional number of shares equal
      to the number that would have been  exercisable or vested as of the end of
      the 12 month period immediately following the Date of Termination. Nothing
      in this  Agreement  shall be  construed  to extend the time period  within
      which any option may be  exercised  beyond  the  period  specified  in the
      applicable stock plan or under the terms of any grant,  award agreement or
      form for exercising any right under any such plan;

      (d) During the Severance Pay Period, in the event you elect to continue to
      participate  in the  Company's  medical  and  dental  plans to the  extent
      permitted   under  COBRA,   the  Company   shall  pay  the  cost  of  such
      participation; and

      (e) You shall be entitled to full executive  outplacement  assistance with
      an agency selected by Avid.

5.    Benefits Upon Voluntary Termination without Good Reason or Termination
      for Cause.

      Upon your  termination  for Cause in accordance  with Section 3(b) or your
      termination  without  Good Reason in  accordance  with Section  3(c),  all
      benefits under this Agreement will be void. In such an event, you shall be
      eligible for the benefits (if any) provided in  accordance  with the plans
      and  policies  of Avid  which are then  applicable  to  employees  of Avid
      generally.

6.    Confidentiality.

      The  provisions  of the Employee  Invention and  Non-Disclosure  Agreement
      between you and Avid shall continue in full force and effect following any
      termination of employment.

7.    Relationship to Change-in-Control Agreement, Etc.

      (a)  In  the  event  you  become   entitled  to  any  benefits  under  any
      Change-in-Control   Employment   Agreement  between  you  and  Avid,  such
      Change-in-Control  Employment  Agreement  shall control and this Agreement
      shall be void and of no further force or effect.

      (b)  Except  as  expressly  set  forth in  Section  7(a),  this  Agreement
      supersedes  all prior  agreements  with Avid related to the subject matter
      hereof and the special  severance  benefits  provided under this Agreement
      are to be  provided  instead  of any other  Avid  severance  arrangements.
      Avid's  severance  policies and  practices  are  superseded  except to the
      extent  incorporated  herein.   Notwithstanding  the  foregoing,   nothing
      contained in this  Agreement  shall have any affect upon your rights under
      any tax qualified  "pension  benefit plan", as such term is defined in the
      Employee  Retirement  Income Security Act of 1974, as amended (ERISA);  or
      any other "welfare benefit plan" as defined in ERISA,  including by way of
      illustration and not limitation,  any medical surgical or  hospitalization
      benefit coverage or long-term  disability  benefit coverage;  or under any
      deferred compensation or equity incentive arrangement, including by way of
      illustration and not limitation,  any stock incentive plan,  non-qualified
      pension plan, or phantom stock plan.

8.    Covenant Not to Compete and Not to Solicit.

      (a) During the term of this  Agreement,  and for a period of two (2) years
      following the termination of your employment for any reason, you agree you
      will not engage in any business  (whether as an owner,  partner,  officer,
      director,  employee,  consultant or otherwise, except as the holder of not
      more than 1% of the  outstanding  stock of a  publicly-held  company) that
      competes or plans to compete with Avid in the business of the development,
      manufacture,  promotion,  distribution  or sale of digital film,  video or
      audio editing,  special effects or newsroom automation systems or products
      or any other  business  in which Avid is engaged or plans to engage at the
      time of your  termination.  Without  limiting the  foregoing,  during such
      period you shall not be employed by or otherwise  serve as a consultant to
      Accom/Abekas/Scitex Digital Video, Adobe, Autodesk/Discreet Logic/DVision,
      Carlton Communications/Quantel,  FAST Technology, Media 100, MGI, Pinnacle
      Systems/Truevision,  Play Systems, SADIE, Sonic Solutions, Tektronix Video
      and Networking  Division/Grass Valley Group, or any of the subsidiaries or
      affiliates of the foregoing companies.

      (b) You also  agree  that,  for a period of two (2) years from the date of
      your termination,  you will not, either directly or indirectly  through an
      agency,  new employer or otherwise,  solicit the employment of (or solicit
      to engage as an independent  contractor or  consultant)  any person who at
      any time during the one year preceding such  solicitation  was an employee
      or independent contractor of Avid or any Avid affiliate.

      (c) If any  restriction  in  this  Section  8 is  found  by any  court  of
      competent jurisdiction to be unenforceable because it extends for too long
      a period of time or over too great a range of activities or in too broad a
      geographic  area, it shall be  interpreted to extend only over the maximum
      period of time,  range of activities or geographic area as to which it may
      be enforceable.

      (d) The  restrictions  contained in this Section 8 are  necessary  for the
      protection of the business and good will of Avid and are considered by you
      to be  reasonable  for such  purpose.  You agree  that any  breach of this
      Section  8  will  cause  Avid  substantial  and  irrevocable  damage  and,
      therefore,  in the event of any such  breach,  in  addition  to such other
      remedies  which  may be  available,  Avid  shall  have  the  right to seek
      specific performance and injunctive relief.

9.    Notice.

      Notice  required or permitted under this Agreement shall be in writing and
      shall be deemed to have been given when  delivered or mailed by the United
      States certified mail,  return receipt  requested,  postage prepaid,  in a
      properly  addressed  envelope.  Notices to Avid shall be  addressed to the
      Corporate Secretary.

10.   Modification; Successors.

      No provision of this  Agreement  may be waived,  modified,  or  discharged
      except  pursuant  to a written  instrument  signed  by you and Avid.  This
      agreement  is  binding  upon any  successor  to all or  substantially  all
      business or assets of Avid.

11.   Indemnification.

      The Company will indemnify you to the extent set forth in the  Certificate
      of  Incorporation  and By-laws of the  Company  for all acts or  omissions
      occurring during the period of your employment.

12.   Miscellaneous.

      This  agreement  shall be governed by and construed  under the laws of the
      Commonwealth  of  Massachusetts.  The  validity or  enforceability  of any
      provision  hereof shall not affect the validity or  enforceability  of any
      other  provision  hereof.  This  Agreement  may be executed in one or more
      counterparts,  each of which  together  will  constitute  one and the same
      instrument.

Accepted and Agreed                       Sincerely,
to this date of

October 18, 1999                          Avid Technology, Inc.

                                          By:
                                          Name:
David Krall                               Title:Mr. David Krall
October 19, 1999
Page 1

                           Change-in-Control Agreement

                                                October 19, 1999

Mr. David Krall

President and Chief Operating Officer
Avid Technology, Inc.
Avid Technology Park
One Park West

Tewksbury, MA 01876

      The Board of Directors (the "Board") of Avid  Technology,  Inc. ("Avid" or
the "Company")  recognizes that your contributions to the past and future growth
and  success  of the  Company  have been and will be  substantial  and the Board
desires to assure the Company of your continued  services for the benefit of the
Company, particularly in the face of a change-in-control of the Company.

      This letter  agreement  ("Agreement")  therefore sets forth those benefits
which the Company  will provide to you in the event your  employment  within the
Company is terminated  after a "Change in Control of the Company" (as defined in
Paragraph 2 (i)) under the circumstances described below.

1.    TERM.

      If a Change in Control of the Company  should occur while you are still an
employee of the Company,  then this Agreement  shall continue in effect from the
date of such  Change in  Control  of the  Company  for so long as you  remain an
employee of the Company,  but in no event for more than two full calendar  years
following  such Change in Control of the Company;  provided,  however,  that the
expiration of the term of this Agreement shall not adversely  affect your rights
under this Agreement which have accrued prior to such  expiration.  If no Change
in Control of the  Company  occurs  before  your  status as an  employee  of the
Company is  terminated,  this  Agreement  shall expire on such date.  Prior to a
Change in Control of the  Company,  your  employment  may be  terminated  by the
Company  with or without  Cause (as  defined in  Paragraph  3(ii)),  and/or this
Agreement may be terminated by the Company,  at any time upon written  notice to
you and, in either or both such events,  you shall not be entitled to any of the
benefits  provided  hereunder;  provided,  however,  that  the  Company  may not
terminate  this  Agreement  following the  occurrence  of a Potential  Change in
Control of the Company (as defined in Paragraph  2(ii))  unless (a) at least one
year has  expired  since the most recent  event or  transaction  constituting  a
Potential  Change in Control of the  Company  and (b) in respect of a  Potential
Change  in  Control  of the  Company  which  previously  occurred,  no  facts or
circumstances  continue to exist which,  if initially  occurring at the time any
termination of this Agreement is to occur,  would  constitute a Potential Change
in Control of the Company.

2.    CHANGE IN CONTROL; POTENTIAL CHANGE IN CONTROL.

      (i) For purposes of this  Agreement,  a "Change in Control of the Company"
      shall be  deemed  to have  occurred  only if any of the  following  events
      occur:

            (a) The  acquisition by an  individual,  entity or group (within the
            meaning of Section  13(d)(3) or 14(d)(2) of the Securities  Exchange
            Act of  1934,  as  amended  (the  "Exchange  Act"))(a  "Person")  of
            beneficial  ownership  (within the meaning of Rule 13d-3 promulgated
            under  the  Exchange  Act)  of 30% or more of  either  (i) the  then
            outstanding  shares of common stock of the Company (the "Outstanding
            Company Common Stock") or (ii) the combined voting power of the then
            outstanding  voting  securities  of the  Company  entitled  to  vote
            generally  in the election of directors  (the  "Outstanding  Company
            Voting Securities");  provided,  however,  that for purposes of this
            subsection  (i), the following  acquisitions  shall not constitute a
            Change of Control:  (A) any  acquisition  directly from the Company,
            (B) any  acquisition  by the  Company,  (C) any  acquisition  by any
            employee  benefit plan (or related trust) sponsored or maintained by
            the Company or any corporation controlled by the Company, or (D) any
            acquisition  by any  corporation  pursuant  to a  transaction  which
            satisfies  the  criteria  set forth in clauses  (A),  (B) and (C) of
            subparagraph (c) of this Paragraph 2(i); or

            (b)  Individuals  who, as of the date hereof,  constitute  the Board
            (the "Incumbent  Board") cease for any reason to constitute at least
            a majority  of the Board;  provided,  however,  that any  individual
            becoming a director  subsequently to the date hereof whose election,
            or  nomination  for  election  by the  Company's  shareholders,  was
            approved  by a vote of at least a  majority  of the  directors  then
            comprising  the  Incumbent  Board shall be considered as though such
            individual were a member of the Incumbent Board, but excluding,  for
            this purpose, any such individual whose initial assumption of office
            occurs as a result of an actual or threatened  election contest with
            respect to the  election or removal of  directors or other actual or
            threatened  solicitation of proxies or consents by or on behalf of a
            Person other than the Board; or

            (c)  Consummation of a  reorganization,  merger or  consolidation or
            sale or other  disposition of all or substantially all of the assets
            of the Company (a  "Business  Combination"),  in each case,  unless,
            following such Business Combination, (A) all or substantially all of
            the  individuals  and  entities  who  were  the  beneficial  owners,
            respectively,   of  the   Outstanding   Company   Common  Stock  and
            Outstanding  Company  Voting  Securities  immediately  prior to such
            Business Combination beneficially own, directly or indirectly,  more
            than 50% of,  respectively,  the  then-outstanding  shares of common
            stock and the combined voting power of the  then-outstanding  voting
            securities  entitled to vote generally in the election of directors,
            of the corporation  resulting from such Business  Combination (which
            as used in this Paragraph 2(i)(c) shall include, without limitation,
            a  corporation  which as a result  of such  transaction  owns all or
            substantially all of the Company's assets either directly or through
            one or more  subsidiaries) in substantially  the same proportions as
            their ownership  immediately  prior to such Business  Combination of
            the Outstanding  Company Common Stock and Outstanding Company Voting
            Securities,  as the case  may be and (B) no  Person  (excluding  any
            corporation resulting from such Business Combination or any employee
            benefit plan (or related  trust) of the Company or such  corporation
            resulting  from  such  Business   Combination)   beneficially  owns,
            directly  or  indirectly,  30% or more  of,  respectively,  the then
            outstanding shares of common stock of the corporation resulting from
            such  Business  Combination,  or the  combined  voting  power of the
            then-outstanding voting securities of such corporation.

      (ii) For purposes of this Agreement, a "Potential Change in Control of the
      Company"  shall be deemed to have  occurred if (A) the Company shall enter
      into  an  agreement,  the  consummation  of  which  would  result  in  the
      occurrence of a Change in Control of the Company,  or (B) any person shall
      publicly announce an intention to take or to consider taking actions which
      if consummated would constitute a Change in Control of the Company, or (C)
      the Company shall receive any written  communication  from any third party
      or third parties, acting as principal or as authorized representative of a
      disclosed  principal,   which  is  publicly  disclosed  and  proposes  (or
      indicates a desire to engage in discussions relating to the possibility of
      or with a view  toward) a  transaction  the  consummation  of which  would
      result in the occurrence of a Change in Control of the Company, or (D) any
      Person  other than the  Company or a  subsidiary  thereof or any  employee
      benefit  plan  sponsored  by the  Company  or a  subsidiary  thereof  or a
      corporation  owned,  directly or indirectly,  by the  shareholders  of the
      Company in substantially  the same proportions as their ownership of stock
      in the Company,  shall (I) become the beneficial owner (within the meaning
      of Rule 13d-3  under the  Exchange  Act),  or (II)  disclose  directly  or
      indirectly  to the Company or publicly a plan or  intention  to become the
      beneficial  owner,  of  voting  shares  representing  20.0% or more of the
      combined voting power of the Outstanding Company Voting Securities, or (E)
      any Person described in clause (D) above who becomes the beneficial owner,
      directly or indirectly, of voting shares representing 20.0% or more of the
      combined voting power of the Outstanding  Company Voting  Securities shall
      increase his  beneficial  ownership of such  securities by 5% or more over
      the percentage  acquired in the transaction  which previously gave rise to
      the  occurrence  of  a  Potential   Change  in  Control  of  the  Company.
      Notwithstanding  the  foregoing,  any  event or  transaction  which  would
      otherwise  constitute a Potential  Change in Control of the Company  shall
      not  constitute  a  Potential  Change in  Control  of the  Company  if the
      negotiations  or other actions  leading to such event or transaction  were
      initiated by the Company (it being  understood that the occurrence of such
      a Company-initiated event or transaction shall not affect the existence of
      any Potential  Change in Control of the Company  resulting  from any other
      event or transaction).

3.    TERMINATION FOLLOWING CHANGE IN CONTROL.

      If a Change in Control of the Company  shall have  occurred  while you are
still an employee of the  Company,  you shall be  entitled to the  payments  and
benefits provided in Paragraph 4 hereof upon the subsequent  termination of your
employment within two (2) full calendar years of such Change in Control,  by you
or by the  Company  unless  such  termination  is (a)  because  of your death or
"Disability",  (b) by the Company for "Cause" (as defined below),  or (c) by you
other than for "Good  Reason" (as  defined  below),  in any of which  events you
shall not be entitled to receive benefits under this Agreement.

      (i)  "Disability".  If, as a result of your  incapacity due to physical or
      mental illness,  you shall have been deemed  "disabled" by the institution
      appointed by the Company to administer the Company's Long-Term  Disability
      Plan (or  successor  plan)  because  you shall have been  absent from your
      duties with the Company on a full-time  basis for six months and shall not
      have returned to full-time  performance  of your duties within thirty days
      after  written  notice  is given  you,  the  Company  may  terminate  your
      employment for Disability.

      (ii)  "Cause".  For the purposes of this Agreement, the Company shall
      have "Cause" to terminate your employment only upon

            (A) the  willful  and  continued  failure  by you  substantially  to
            perform  your duties with the Company  (other than any such  failure
            resulting from your  incapacity due to physical or mental illness or
            any failure resulting from your terminating your employment with the
            Company for "Good Reason" (as defined below)) after a written demand
            for  substantial  performance is delivered to you by the Board which
            specifically  identifies the manner in which the Board believes that
            you have not substantially performed your duties, or

            (B) the willful engaging by you in gross  misconduct  materially and
            demonstrably injurious to the Company.

            For purposes of this  paragraph,  no act, or failure to act, on your
            part shall be  considered  "willful"  unless done,  or omitted to be
            done,  by you not in good faith and without  reasonable  belief that
            your action or omission  was in the best  interests  of the Company.
            Notwithstanding the foregoing,  you shall not be deemed to have been
            terminated  for  Cause  unless  and  until  there  shall  have  been
            delivered  to  you a  copy  of a  resolution  duly  adopted  by  the
            affirmative  vote of not  less  than  three-quarters  of the  entire
            membership  of the Board at a meeting  of the Board  called and held
            for that purpose  (after at least 20 days prior notice to you and an
            opportunity for you, together with your counsel,  to be heard before
            the Board),  finding that in the good faith opinion of the Board you
            failed to perform your duties or engaged in  misconduct as set forth
            in clause  (A) or (B) of this  Paragraph  3(ii) and that you did not
            correct such failure or cease such misconduct  after being requested
            to do so by the Board.

      (iii) "Good Reason".  You may terminate your employment for Good
      Reason.  For purpose of this Agreement, "Good Reason" shall mean:

            (A) the  assignment  to you of any  duties  materially  inconsistent
            with,  or  any  material  diminution  of,  your  positions,  duties,
            responsibilities, and status with the Company immediately prior to a
            Change in  Control  of the  Company,  or a  material  change in your
            titles  or  offices  as in effect  immediately  prior to a Change in
            Control of the Company,  or any removal of you from,  or any failure
            to reelect you to, any such positions;

            (B) a  reduction  by the  Company  in your  base  salary  in  effect
            immediately prior to a Change in Control of the Company or a failure
            by the Company to increase your base salary  (within  fifteen months
            of your last increase) in an amount which is substantially  similar,
            on a percentage  basis, to the average  percentage  increase in base
            salary for all  officers  of the  Company  during the twelve  months
            preceding your increase;

            (C) the  failure  by the  Company  to  continue  in effect  any life
            insurance,  health or accident or  disability  plan in which you are
            participating or are eligible to participate at the time of a Change
            in Control of the Company (or plans providing you with substantially
            similar  benefits),  except as  otherwise  required in terms of such
            plans as in  effect  at the time of any  Change  in  Control  of the
            Company  or the  taking of any  action by the  Company  which  would
            adversely  affect your  participation  in or materially  reduce your
            benefits  under any of such  plans or  deprive  you of any  material
            fringe benefits enjoyed by you at the time of a Change in Control of
            the  Company or the  failure by the  Company to provide you with the
            number of paid vacation days to which you are entitled in accordance
            with the vacation policies of the Company in effect at the time of a
            Change in Control of the Company;

            (D) the  failure  by the  Company  to (i)  continue  in  effect  any
            material  incentive  or  variable  compensation  plan in  which  you
            participate  immediately  prior to the Change of Control,  unless an
            equitable   arrangement   (embodied  in  an  ongoing  substitute  or
            alternative  plan) has been made with  respect  to such  plan,  (ii)
            continue  your  participation  therein  (or in  such  substitute  or
            alternative plan) on a basis not materially less favorable,  both in
            terms of the  amount  of  benefits  provided  and the  level of your
            participation relative to other participants, as existed at the time
            of the  Change of  Control  or (iii)  award  cash  bonuses to you in
            amounts and in a manner substantially  consistent with past practice
            in light of the Company's financial performance;

            (E) any  requirement  by the Company  that (i) the location of which
            you perform  your  principal  duties for the Company be changed to a
            new  location  that is more than 45 miles from the location at which
            you perform your principal duties for the Company at the time of the
            Change in Control of the Company or (ii) you are  required to travel
            on an overnight  basis to a  significantly  greater  extent than you
            were  required  to so travel  prior to the  Change in Control of the
            Company;

            (F) any  material  breach by the  Company of any  provision  of this
            Agreement (including, without limitation, Paragraph 6), which is not
            cured within 30 days after written notice thereof; or

            (G) any  purported  termination  of your  employment  by the Company
            which is not effected pursuant to a Notice of Termination satisfying
            the  requirements  of  subparagraph  (iv) below (and, if applicable,
            subparagraph  (ii) above);  and for purposes of this  Agreement,  no
            such purported termination shall be effective.

      (iv) Notice of  Termination.  Any  termination by the Company  pursuant to
      subparagraphs  (i) or (ii) above or by you pursuant to subparagraph  (iii)
      above shall be  communicated by written Notice of Termination to the other
      party hereto.  For purposes of this  Agreement,  a "Notice of Termination"
      shall  mean  a  notice  which  shall  indicate  the  specific  termination
      provision in this Agreement  relied upon and shall set forth in reasonable
      detail  the  facts  and  circumstances  claimed  to  provide  a basis  for
      termination of your termination under the provision so indicated.

      (v)   Date of Termination.  "Date of Termination" shall mean:

            (A) if this  Agreement is  terminated  for  Disability,  thirty days
            after Notice of  Termination  is given  (provided that you shall not
            have returned to the performance of your duties on a full-time basis
            during such thirty-day period),

            (B) if your employment is terminated  pursuant to subparagraph (iii)
            above, the date specified in the Notice of Termination, and

            (C) if your employment is terminated for any other reason,  the date
            on which a  Notice  of  Termination  is given  (or,  if a Notice  of
            Termination is not given, the date of such termination).

4.    COMPENSATION DURING DISABILITY OR UPON TERMINATION.

      (i) If,  after a Change in  Control  of the  Company,  you  shall  fail to
      perform your duties hereunder as a result of incapacity due to Disability,
      you shall  continue to receive  your full base salary twice a month at the
      rate then in effect and any awards under the  Executive/Senior  Management
      Variable  Compensation Plan or any successor plan shall continue to accrue
      and to be paid during  such period  until your  employment  is  terminated
      (and, if the Company  maintains a Long Term Disability  Plan, you shall be
      eligible for coverage  thereunder in accordance with the terms thereof and
      subject  to the  satisfaction  of  all  applicable  conditions,  including
      without  limitation,  the timely  filing of a notice of claim);  provided,
      however, in the event the Company makes no interim individual accruals for
      the  Executive/Senior   Management  Variable   Compensation  Plan  or  any
      successor  plan in  respect of any period for which no award has been made
      under such Plan you shall receive payment during such period of Disability
      in the amount equal to the product of (a) the amount  awarded to you under
      such Plan or any  successor  plan during the period most  recently  ended,
      multiplied by (b) a fraction (hereinafter the "Partial Service Fraction"),
      the  numerator  of  which is the  whole  and  partial  months  of  service
      completed  in the  current  period,  and the  denominator  of which is the
      number of months in the period most recently  ended for which an award was
      made.

      (ii) If, after a Change in Control of the Company,  your employment  shall
      be  terminated  for Cause,  the  Company  shall pay you for your full base
      salary  through the Date of  Termination at the rate in effect at the time
      Notice of  Termination  is given and the  Company  shall  have no  further
      obligations to you under this Agreement.

      (iii) If,  within two years after a Change in Control of the Company,  the
      Company shall terminate your employment,  other than pursuant to Paragraph
      3(i) or 3(ii) hereof or by reason of death,  or you shall  terminate  your
      employment for Good Reason.

            (A) The Company shall pay you as severance  pay (and without  regard
            to the  provisions of any benefit plan) in a lump sum in cash on the
            fifth day following the Date of Termination, the following amounts:

                  (x) your  accrued but unpaid  base salary  through the Date of
                  Termination  at the  rate in  effect  at the  time  Notice  of
                  Termination is given,  plus an amount equal to the amount,  if
                  any, of any incentive  compensation awards which have not been
                  paid  but   which   have   been   earned   by  you  under  the
                  Executive/Senior  Management Variable Compensation Plan or any
                  successor  plan  (including  awards which have been  deferred,
                  except to the extent such awards have been transferred,  prior
                  to a Change in Control  of the  Company,  by the  Company to a
                  trustee in an irrevocable  trust) it being understood that you
                  shall  have  earned in each  year for which an award  shall be
                  payable  an  amount  equal to the  product  of (a) the  amount
                  awarded you under such Plan or any  successor  plan during the
                  period  most  recently  ended,  multiplied  by (b) the Partial
                  Service Fraction; and

                  (y) an amount  equal to the sum of your  annual base salary at
                  the highest rate in effect during the twelve (12) month period
                  immediately  preceding the Date of Termination  plus two times
                  the   amount   of  the   highest   award  to  you   under  the
                  Executive/Senior  Management Variable Compensation Plan or any
                  successor plan during the twenty-four  (24) month period ended
                  on the Date of Termination.

            (B) For a twenty-four (24) month period after such termination,  the
            Company shall arrange to provide you with life, dental, accident and
            group health insurance benefits  substantially similar to those that
            you were  receiving  immediately  prior to such  termination  to the
            extent that the  Company's  plans then permit the Company to provide
            you with such benefits.  Notwithstanding the foregoing,  the Company
            shall not  provide  any such  benefits  to you to the extent that an
            equivalent  benefit is received by you from another  employer during
            such period, and you shall report any such benefit actually received
            by you to the Company;

            (C) The  exercisability  of  all   outstanding   stock  options  and
            restricted stock  awards then held by you shall accelerate  in full,
            provided that if such acceleration  would  disqualify  the Change in
            Control from being accounted for as a  pooling of interests and such
            accounting  treatment  would  otherwise be available and is desired,
            such exercisability and vesting will not be accelerated; and

            (D) You shall be entitled to full executive  outplacement assistance
            with an agency selected by the Company.

      (iv) You shall not be  required  to  mitigate  the  amount of any  payment
      provided for in this Paragraph 4 by seeking other employment or otherwise,
      nor shall the amount of any payment  provided  for in this  Paragraph 4 be
      reduced by any  compensation  earned by you as the result of employment by
      another employer after the Date of Termination, or otherwise.

      (v) Nothing in this  Agreement  shall prevent or limit your  continuing or
      future participation in any plan, program,  policy or practice provided by
      the Company to its employees and for which you may qualify nor, subject to
      Paragraph 13 hereof,  shall anything herein limit or otherwise affect such
      rights as you may have under any contract or agreement between you and the
      Company; provided, however, that to the extent you are entitled to receive
      any payments hereunder upon termination of your employment,  you shall not
      be entitled to any payments under any severance plan,  program,  policy or
      practice of the Company then in effect.

5.    CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY.

      (i) Anything in this Agreement to the contrary  notwithstanding and except
      as set forth below,  in the event it shall be determined  that any payment
      or  distribution  by the  Company  to or for the your  benefit  and/or any
      acceleration of vesting of any options or restricted stock awards (whether
      paid or payable or distributed or  distributable  or provided  pursuant to
      the terms of this Agreement or otherwise, but determined without regard to
      any  additional  payments  required  under this Paragraph 5) (a "Payment")
      would be subject to the excise tax imposed by Section 4999 of the Internal
      Revenue Code or any interest or penalties are incurred by you with respect
      to such excise tax (such excise tax,  together  with any such interest and
      penalties,  are hereinafter collectively referred to as the "Excise Tax"),
      then you shall be entitled to receive an  additional  payment (a "Gross-Up
      Payment")  in an amount  such that  after the  payment by you of all taxes
      (including any interest or penalties  imposed with respect to such taxes),
      including,  without  limitation,  any income  taxes (and any  interest and
      penalties  imposed with  respect  thereto) and Excise Tax imposed upon the
      Gross-Up  Payment,  you retain an amount of the Gross-Up  Payment equal to
      the Excise Tax imposed upon the Payments.  Not  withstanding the foregoing
      provisions of this Paragraph  5(i), if it shall be determined that you are
      entitled to a Gross-Up  Payment,  but that you,  after taking into account
      the Payments and the Gross-Up  Payment,  would not receive a net after-tax
      benefit of at least $50,000 (taking into account both income taxes and any
      Excise  Tax) as compared to the net  after-tax  proceeds to you  resulting
      from  an  elimination  of the  Gross-Up  Payment  and a  reduction  of the
      Payments,  in an aggregate,  to an amount (the "Reduced Amount") such that
      the  receipt of Payments  would not give rise to any Excise  Tax,  then no
      Gross-Up Payment shall be made to you and the Payments,  in the aggregate,
      shall be reduced to the Reduced Amount.

      (ii) Subject to the  provisions  of  Paragraph  5(i),  all  determinations
      required to be made under this Paragraph 5,  including  whether and when a
      Gross-Up  Payment is required and the amount of such Gross-Up  Payment and
      the assumptions to be utilized in arriving at such determination, shall be
      made  by  PricewaterhouseCoopers   LLP  or  such  other  certified  public
      accounting  firm as may be  designated  by the  Company  (the  "Accounting
      Firm") which shall provide  detailed  supporting  calculations to both the
      Company and you within 15 business  days of the receipt of notice from you
      that there has been a Payment, or such earlier time as is requested by the
      Company. In the event that the Accounting Firm is serving as accountant or
      auditor  for the  individual,  entity,  or group  affecting  the Change of
      Control,   the  Company  shall  appoint  another   nationally   recognized
      accounting firm to make the determinations required hereunder.

      All  fees  and  expenses  of the  Accounting  Firm  shall  be borne by the
      Company. Any Gross-Up Payment, as determined pursuant to this Paragraph 5,
      shall  be paid by the  Company  to you  within  ten  business  days of the
      receipt of the Accounting Firm's  determination.  Any determination by the
      Accounting  Firm shall be binding upon the Company and you. As a result of
      the uncertainty in the application of Section 4999 of the Code at the time
      of the initial  determination  by the  Accounting  Firm  hereunder,  it is
      possible  that  Gross-Up  Payments  which  will not have  been made by the
      Company  should  have  been  made  ("Underpayment"),  consistent  with the
      calculations required to be made hereunder.  In the event that the Company
      exhausts its remedies  pursuant to Paragraph 5(iii) and you thereafter are
      required to make a payment of any Excise Tax,  the  Accounting  Firm shall
      determine  the amount of the  Underpayment  that has occurred and any such
      Underpayment shall be promptly paid by the Company to or for your benefit.

      (iii) You shall notify the Company in writing of any claim by the Internal
      Revenue  Service  that,  if  successful,  would require the payment by the
      Company of the Gross-Up Payment.  Such notification shall be given as soon
      as practical but no later than ten business days after you are informed in
      writing of such a claim and shall apprise the Company of the nature of the
      claim  and the  date on which  such  claim is  requested  to be paid.  The
      Executive  shall not pay such claim prior to the  expiration of the 30-day
      period following the date on which it gives such notice to the Company (or
      such  shorter  period  ending on the date that any  payment  of taxes with
      respect  to such claim is due).  If the  Company  notifies  you in writing
      prior to the  expiration  of such period  that it desires to contest  such
      claim, you shall:

            (A)   give the Company any information reasonably requested by
            the Company relating to such claim,

            (B)   take such action in connection with contesting such claim as
            the Company shall reasonably request in  writing  from time to time,
            including,  without limitation,  accepting legal representation with
            respect  to such claim by an  attorney  reasonably  selected  by the
            Company,

            (C)   cooperate with the Company in good faith in order to
            effectively contest such claim, and

            (D)   permit the Company to participate in any proceedings
            relating to such claim;

      provided,  however, that the Company shall bear and pay directly all costs
      and expenses  (including  additional  interest and penalties)  incurred in
      connection with such contest and shall indemnify and hold you harmless, on
      an after-tax basis,  for any Excise Tax or income tax (including  interest
      and  penalties  with  respect   thereto)  imposed  as  a  result  of  such
      representation  and payment of costs and expenses.  Without  limitation of
      the  foregoing  provisions  of this  Paragraph  5(iii),  the Company shall
      control all proceedings  taken in connection with such contest and, at its
      sole  option,  may  pursue or forego any and all  administrative  appeals,
      proceedings, hearings and conferences with the taxing authority in respect
      of such claim and may, at its sole  option,  either  direct you to pay the
      tax  claimed  and  sue  for a  refund  or to  contest  the  claim  in  any
      permissible  manner,  and  you  agree  to  prosecute  such  contest  to  a
      determination  before any administrative  tribunal,  in a court of initial
      jurisdiction  and in one or more  appellate  courts,  as the Company shall
      determine;  provided, however, that if the Company directs you to pay such
      claim and sue for a refund,  the Company  shall advance the amount of such
      payment to you, on an  interest-free  basis,  and shall indemnify and hold
      the you harmless, on an after-tax basis, from any Excise Tax or income tax
      (including  interest or  penalties  with  respect  thereto)  imposed  with
      respect to such advance or with respect to any imputed income with respect
      to such advance; and further provided that any extension of the statute of
      limitations  relating  to  payment  of taxes  for your  taxable  year with
      respect  to which  such  contested  amount is claimed to be due is limited
      solely to such contested amount. Furthermore, the Company's control of the
      contest  shall be  limited  to issues  with  respect  to which a  Gross-Up
      Payment would be payable  hereunder and you shall be entitled to settle or
      contest,  as the case may be,  any  other  issue  raised  by the  Internal
      Revenue Service or other taxing authority.

      (iv) If,  after the  receipt by you of an amount  advanced  by the Company
      pursuant to Paragraph  5(iii),  you become  entitled to receive any refund
      with  respect  to  such a  claim,  you  shall  (subject  to the  Company's
      complying with the  requirements of Paragraph  5(iii)) promptly pay to the
      Company  the amount of such refund  (together  with any  interest  paid or
      credited thereon after taxes applicable thereto). If, after the receipt by
      you of an amount advanced by the Company  pursuant to Paragraph  5(iii), a
      determination  is made that you shall not be  entitled  to any refund with
      respect  to such claim any the  Company  does not notify you in writing of
      its intent to contest such denial of refund prior to the  expiration of 30
      days after such  determination,  then such  advance  shall be forgiven and
      shall not be  required to be repaid and the amount of such  advance  shall
      offset, to the extent thereof,  the amount of Gross-Up Payment required to
      be paid.

6.    SUCCESSOR'S BINDING AGREEMENT.

      (i) The Company will require any successor (whether direct or indirect, by
      purchase, merger, consolidation, or otherwise) to all or substantially all
      of the business and/or the assets of the Company,  expressly to assume and
      agree to perform this  Agreement in the same manner and to the same extent
      that the Company  would be required to perform if no such  succession  had
      taken place. As used in this  Agreement,  "Company" shall mean the Company
      as  defined  above and any  successor  to its  business  and/or  assets as
      aforesaid  which executes and delivers the agreement  provided for in this
      paragraph  6 or  which  otherwise  becomes  bound  by all  the  terms  and
      provisions of this Agreement by operation of law.

      (ii) This Agreement  shall inure to the benefit of, and be enforceable by,
      your  personal  or  legal  representatives,   executors,   administrators,
      successors, heirs, distributees,  devisees and legatees. If you should die
      while any  amounts  would  still be  payable to you  hereunder  if you had
      continued to live, all such amounts,  unless  otherwise  provided  herein,
      shall be paid in  accordance  with the  terms  of this  Agreement  to your
      devisee,  legatee or other designee or, if there be no such  designee,  to
      your estate.

7.    EMPLOYMENT.

      In consideration of the foregoing obligations of the Company, you agree to
be bound by the  terms and  conditions  of this  Agreement  and to remain in the
employ of the Company during any period following the announcement by any person
of any proposed transaction or transactions which, if effected,  would result in
a Change in Control of the Company  until a Change in Control of the Company has
taken  place,  or in the  opinion of the Board,  such  person has  abandoned  or
terminated its efforts to effect a Change in Control of the Company.  Subject to
the foregoing,  nothing contained in this Agreement shall impair or interfere in
any way with your right to terminate your employment or the right of the Company
to terminate your  employment with or without Cause prior to a Change in Control
of the  Company.  Nothing  contained in this  Agreement  shall be construed as a
contract  of  employment  between  the  Company and you or as a right for you to
continue in the employ of the Company,  or as a  limitation  on the right of the
Company to discharge  you with or without  Cause prior to a Change in Control of
the Company.

8.    COMPETITIVE ACTIVITY.

      (i) If your employment  terminates under circumstances that entitle you to
      receive  benefits under this Agreement (as described in the first sentence
      of paragraph 3 of this  Agreement),  then,  unless the Company  materially
      breaches  this  Agreement,  you agree you will not for a period of one (1)
      year after such termination  engage in any business  (whether as an owner,
      partner, officer, director,  employee,  consultant or otherwise, except as
      the holder of not more than 1% of the outstanding stock of a publicly-held
      company)  that  competes or plans to complete with Avid in the business of
      the development,  manufacture,  promotion, distribution or sale of digital
      film,  video or audio  editing,  special  effects or  newsroom  automation
      systems  or  products  or any other  business  in which Avid is engaged or
      plans to  engage at the time of your  termination.  Without  limiting  the
      foregoing,  during such  period you shall not be employed by or  otherwise
      serve  as  a  consultant  to  Accom/Abekas/Scitex  Digital  Video,  Adobe,
      Autodesk/Discreet  Logic/DVision,  Carlton  Communications/Quantel,   FAST
      Technology,  Media 100, MGI,  Pinnacle  Systems/Truevision,  Play Systems,
      SADIE,  Sonic  Solutions,  Tektronix  Video and Networking  Division/Grass
      Valley Group,  or any of the  subsidiaries  or affiliates of the foregoing
      companies.

      (ii) You also  agree  that,  for a period of one (1) year from the date of
      your termination,  you will not, either directly or indirectly  through an
      agency,  new employer or otherwise,  solicit the employment of (or solicit
      to engage as an independent  contractor or  consultant)  any person who at
      any time during the one year preceding such  solicitation  was an employee
      or independent contractor of Avid or any Avid affiliate.

9.    INJUNCTIVE RELIEF.

      You  acknowledge  and agree that the remedy of the  Company at law for any
breach  of the  covenants  and  agreements  contained  in  Paragraph  8 of  this
Agreement  will be  inadequate,  and  that the  Company  shall  be  entitled  to
injunctive  relief against any such breach or threatened  breach.  You represent
and agree that such  injunctive  relief  shall not  prohibit  you from earning a
livelihood acceptable to you.

10.   NOTICE.

      For the purposes of this Agreement,  notices and all other  communications
provided for in this  Agreement  shall be in writing and shall be deemed to have
been duly given  when  delivered  or mailed by United  States  registered  mail,
return receipt requested, postage prepaid, addressed to the respective addresses
set forth on the first page of this  Agreement,  provided that all other notices
to the Company should be directed to the attention to the Corporate Secretary of
the Company,  or to such address as either party may have furnished to the other
in writing in  accordance  herewith,  except  that  notices of change of address
shall be effective only upon receipt.

11.   INDEMNIFICATION.

      The Company will indemnify you to the extent set forth in the  Certificate
of  Incorporation  and  By-laws  of the  Company as in effect on the date of the
Change in Control of the Company.

12.   FURTHER ASSURANCES.

      Each party hereto agrees to furnish and execute such additional  forms and
documents,  and to  take  such  further  action,  as  shall  be  reasonable  and
customarily required in connection with the performance of this Agreement or the
payment of benefits hereunder.

13.   ENTIRE AGREEMENT.

      This Agreement represents the entire agreement of the parties with respect
to the subject  matter hereof and  supersedes  any other  agreement  between the
parties with respect to such subject matter.

14.   COUNTERPARTS.

      This Agreement may be executed in one or more counterparts,  each of which
shall be deemed to be an original but all of which together will  constitute one
in the same instrument.

15.   LEGAL FEES AND EXPENSES.

      In addition to any other benefits to which you may be entitled  hereunder,
the Company shall pay all reasonable legal fees and expenses which you may incur
as a result of the Company's  contesting  the validity,  enforceability  or your
interpretation  of, or  determination  under,  this  Agreement or otherwise as a
result of any  termination as a result of which you are entitled to the benefits
set forth in this Agreement.

16.   MISCELLANEOUS.

      (i) No provision of this Agreement may be modified,  waived, or discharged
      unless such  waiver,  modification,  or  discharge is agreed to in writing
      signed by you and such officer as may be  specifically  designated  by the
      Board of Directors of the Company.

      (ii) No  waiver by either  party  hereto at any time of any  breach by the
      other party hereto of, or compliance  with,  any condition or provision of
      this  Agreement  to be  performed  by such other  party  shall be deemed a
      waiver of similar or dissimilar provisions or conditions at the same or at
      any time prior or subsequent time.

      (iii) The validity,  interpretation,  construction and performance of this
      Agreement   shall  be  governed  by  the  laws  of  the   Commonwealth  of
      Massachusetts.

      (iv) The invalidity or unenforceability of any provision of this Agreement
      shall not affect the validity or  enforceability of any other provision of
      this Agreement, which shall remain in full force and effect.

      (v) The Company may withhold from any amounts payable under this Agreement
      such  federal,  state,  local or foreign  taxes as shall be required to be
      withheld pursuant to any applicable law or regulation.

      If this Agreement correctly sets forth our agreement on the subject matter
hereof,  kindly  sign  and  return  to the  Company  the  enclosed  copy of this
Agreement which will then constitute our agreement on this subject.

                                    Sincerely,

                                    Avid Technology, Inc.

                                    By:

                                    --------------------------------
                                    Name:

                                    Title:

I acknowledge receipt and agree with the foregoing terms and conditions.

--------------------------------
David Krall

Date:  October 19, 1999

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