Document:

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                                   EXHIBIT 10.16

                                EMPLOYMENT AGREEMENT
                                DATED MARCH 1, 2000
                                   BY AND BETWEEN

NOGATECH LTD., a company having an office and place of business in 3 Hagavish
St., Kfar Saba, Israel (the "COMPANY")

                                        AND

DR. ARIE HEIMAN, identity number 045391760 of 45 Yehuda Halevi Street,
Ra'anana, Israel (the "EMPLOYEE")

WHEREAS, the Company desires to employ the Employee as its President and
Chief Executive Officer, and to avail itself of the Employee's talents and
abilities; and

WHEREAS, the Employee desires to be employed by the Company, subject to the
terms and conditions set forth below.

NOW, THEREFORE, the parties hereby agree as follows:

1.     EMPLOYMENT DUTIES

       1.1.   Employee shall perform the responsibilities of President and Chief
              Executive Officer, and any responsibilities incidental thereto.
              Employee shall not become engaged in any other occupation whether
              for compensation or not while employed hereunder, without the
              express written consent of the chairman of the Board of Directors
              of the Company.

       1.2.   Employee's employment with the Company may require travel outside
              Israel, and the Employee agrees to such travel as may be necessary
              in order to fulfill his duties toward the Company.

       1.3.   Employee's position is a "senior managerial position", as defined
              in the Work and Rest Hours Law, 1951, and requires a high level of
              trust.  Accordingly, the provisions of said law shall not apply to
              Employee and Employee agrees that he may be required to work
              beyond the regular working hours of the Company, for no additional
              compensation other than as specified in this Agreement.

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                                       2

       1.4.   Employee declares that the fulfillment of the undertakings
              pursuant to this Agreement, his employment by the Company and the
              use of information in his possession and of his abilities, does
              not breach, and will not breach, any other agreement or
              undertaking for the preservation of confidentiality and
              non-competition to which he is a party.  Employee agrees and
              undertakes not to perform any act or to omit to perform any act
              which may breach his fiduciary duty to the Company or which may
              place him in a position of conflict of interest with the
              objectives of the Company. In addition, Employee agrees and
              undertakes to inform the Company promptly of any such matter which
              may place him in such a situation of  potential conflict of
              interest.

2.     TERM

       This Employment Agreement commences as of March 1, 2000 and shall
       continue for a period of twelve (12) months (the "Initial Term"),
       unless sooner terminated in accordance with the terms of Section 9.1
       below. Upon the expiration of the Initial Term, this Employment
       Agreement shall automatically renew for successive twelve (12) month
       periods (each twelve month period shall be referred to as an "Extended
       Term"), unless sooner terminated in accordance with the terms of
       Sections 9.1 or 9.2 below.

3.     COMPENSATION

       3.1.   FIXED SALARY.  Employee shall receive a fixed monthly Gross Salary
              of NIS 51,000 (Fifty One Thousand New Israeli Shekels) (the "GROSS
              SALARY"), payable on a monthly basis.

       3.2.   VACATION. Employee shall accrue paid vacation at the rate of
              twenty-five (25) days for each twelve (12) months of employment.
              Employee may not accumulate his vacation days for more than twenty
              four (24) months of employment.

       3.3.   SICK LEAVE. Employee shall accrue sick leave at the same rate
              generally available to the Company's employees according to the
              provisions of the Sick Pay Law - 1976 and subject to Employee
              producing the required medical certificates.

       3.4.   BENEFITS. During the term of Employee's employment, Employee shall
              be entitled to Manager's Insurance (Bituach Menhalim) to be
              registered on his name, in an amount equal to 15.83% of the Gross
              Salary, which shall be paid monthly to said Manager's Insurance
              Plan directly by the Company. The insurance shall be allocated as
              follows: (i) 8.33% in respect of severance compensation, (ii) 5%
              in respect of pension and (iii) up to 2.5% in respect of

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              disability.  An additional 5% of the Gross Salary shall be
              deducted by the Company from the monthly payment of Employee's
              salary as Employee's contribution to said Manager's Insurance.
              Notwithstanding anything in this agreement to the contrary, in the
              event that the employment relationship between Employee and the
              Company is terminated in such circumstances that entitle the
              Company to refrain from paying Employee severance pay pursuant the
              relevant labor laws of the State of Israel, Employee shall
              immediately transfer and return to the Company the title and any
              and all amounts accumulated in the Manager's Insurance on account
              of severance pay.

       3.5.   EDUCATION FUND. The Company shall contribute to a Continuing
              Education Fund (Keren Hishtalmut), to be chosen by the Company for
              the benefit of Employee, in an amount equal to 7.5% of his Gross
              Salary per month, subject to Employee's contribution of an
              additional 2.5% of his Gross Salary per month. All tax obligations
              related to the Education Fund shall be borne by the Employee.

       3.6.   The Company shall provide and pay Employee Recreation Funds (Dmei
              Havra'ah) at the rate required by law and regulations.

4.     EXPENSES

       The Company shall reimburse Employee for his normal and reasonable
       expenses incurred for travel, entertainment and similar items in
       promoting and carrying out the business of the Company in accordance with
       the Company's general policy, in effect from time to time. The Employee
       shall provide the Company with copies of all invoices and receipts, and
       otherwise account to the Company in sufficient detail to allow the
       Company to claim an income tax deduction for such paid item, if item is
       deductible. Reimbursement shall be made on a monthly, or more frequent,
       basis, in accordance with Company's policy.

5.     RESERVE DUTY

       Immediately upon receipt of a notice of reserve duty, Employee shall
       report such notice to the Company's Board of Directors. Upon Employee's
       return from reserve duty, Employee shall deliver to the Company
       appropriate confirmation of reserve duty served from his military unit,
       against which the Company shall pay Employee his regular compensation
       package with respect to the period served.

6.     COVENANT NOT TO COMPETE

       Employee agrees that he is and shall be in a position of special trust
       and confidence and will have access to confidential and proprietary
       information about the Company's

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       business and plans.  Employee agrees that he will not directly or
       indirectly, either as an employee, employer, consultant, agent,
       principal, partner, stockholder, corporate officer, director, or in
       any similar individual or representative capacity, engage or
       participate in any business competitive with the Company's business,
       including projects under consideration by the Company at the time of
       termination, during the term of his employment for a period of
       eighteen (18) months after the termination of his employment,
       regardless of the reason for such termination and regardless of
       whether such termination was initiated by the Employee or by the
       Company.

7.     CONFIDENTIALITY AND TRADE SECRETS

       7.1.   KNOW-HOW AND INTELLECTUAL PROPERTY. It is understood that the
              Company has developed or acquired and will continue to develop or
              acquire certain products, technology, unique or special methods,
              manufacturing and assembly processes and techniques, trade
              secrets, written marketing plans and customer arrangements, and
              other proprietary rights and confidential information which are
              not in the public domain (collectively referred to as the "COMPANY
              PROPERTY"). It is expected that the Employee will gain knowledge
              of and utilize the Company Property during the course and scope of
              his employment with the Company, and will be in a position of
              trust with respect to the Company Property. All inventions and
              developments made by the Employee for the Company in the context
              of his employment with the Company, and all intellectual property
              rights contained therein, are Company Property. Employee agrees
              that all rights he has to any technology, patents, copyrights,
              ideas in whatever form, and any other intellectual property
              rights, which relate to the Company Property are unconditionally
              assigned to and owned, free of any third party rights or
              encumbrances, by the Company, and the Employee agrees to cooperate
              with the Company and to provide to it all details necessary to
              carry out any registration or act, to sign all documents and to
              take all actions to enable the Company to make use of all the
              Company Property, to duly register the same, whether in Israel or
              abroad, should the Company desire to do so, and/or to protect the
              same in any other manner as the Company shall see fit.  The
              Employee's obligation to assist the Company in the acquisition and
              enforcement of intellectual property rights and protections in
              connection with the Company Property shall survive the termination
              of this Agreement and the termination of Employee's employment
              with the Company.

       7.2.   COMPANY PROPERTY. It is hereby stipulated and agreed that the
              Company Property shall remain the Company's sole property.  It is
              further stipulated and agreed by the parties, as a material
              inducement for the Company having entered into this Agreement and
              remaining a party hereto (subject to any early

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              termination hereof by the Company), that Employee shall be
              bound by the Employee Non-Disclosure Agreement appended hereto
              as Appendix A.

       Notwithstanding the foregoing, it is hereby agreed that the patents
       specified in Appendix B hereto were developed by the Employee prior his
       commencement of employment for the Company, and therefore such patents
       shall not be deemed to be Company Property.

       7.3.   EFFECT OF TERMINATION. In the event that Employee's employment is
              terminated, for whatever reason, Employee agrees not to copy, make
              known, disclose or use, any of the Company Property, and the
              Employee shall continue to observe the provisions of the Employee
              Non-Disclosure Agreement, which shall survive such termination.
              Without derogating from the Company's rights under the law of
              torts, Employee further agrees not to endeavor or attempt in any
              way to interfere with or induce a breach of any relationship that
              the Company may have with any employee, customer, contractor,
              supplier, representative, or distributor for a period of eighteen
              (18) months from the date of any termination of Employee's
              employment with the Company for any reason whatsoever. Employee
              agrees, upon termination of employment, to deliver to the Company
              all confidential papers, material documents, records, lists and
              material notes (whether prepared by Employee or others), in any
              media whatsoever, comprising or containing the Company Property,
              without retaining any copies thereof, and any other property of
              the Company.

       7.4.   MATERIAL BREACH. It is hereby agreed that a breach of Sections 6
              or 7 or Appendix A hereto shall be considered as a material
              breach of this Agreement.

8.     CORPORATE OPPORTUNITIES

       In the event that during the Employment Term, any business opportunity
       related to the Company's business shall come to Employee's knowledge,
       Employee shall promptly notify the chairman of the Board of Directors of
       the Company of such opportunity. Employee shall not appropriate for
       himself or for any other person other than the Company, any such
       opportunity, except with the express written consent of the chairman of
       the Board of Directors of the Company, in advance. Employee's duty to
       notify the Company and to refrain from appropriating all such
       opportunities shall neither be limited by, nor shall such duty limit, the
       application of the general law of Israel relating to the fiduciary duties
       of an agent or employee.

9.     TERMINATION OF EMPLOYMENT

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       9.1.   GENERAL.  This Agreement may be terminated by Employee at any
              time, without cause, by giving the Company 30 (thirty) days
              advance written termination notice.

       This Agreement may be terminated by the Company at any time, without
       cause, by giving the Employee a twelve (12) months advance written
       termination notice ("Notice Period").

       In the event that the Company terminates this Agreement without cause,
       Employee shall be deemed to have continuously remained an Employee of the
       Company throughout the Notice Period.  Notwithstanding Section 1.1
       hereinabove, during the Notice Period, Employee shall be entitled to be
       employed by other employers, subject to Sections 6 and 7 above, and
       the terms of Appendix A hereto. In the event that the Company terminates
       this Agreement without cause, the non-competition period (as specified in
       Section 6 above) shall commence upon the delivery to the Employee of
       notice of discharge by the Company.

       9.2.   TERMINATION FOR CAUSE. The Company may immediately terminate
              Employee's employment at any time for Cause. Termination for Cause
              shall be effective from the receipt of written notice thereof to
              Employee. "Cause" means: (i) material violation of any of Sections
              1, 6, 7, 8 of this Agreement; (ii) conviction of any
              felony which involves moral turpitude; or (iii) intentional
              disclosure confidential information relating to the Company or its
              business to a third party, other than in the course of carrying
              out Employee's duties hereunder. The Company's exercise of its
              rights to terminate with Cause shall be without prejudice to any
              other right or remedy it may have.

       9.3.   LOAN.  In the event that the Company terminates this Agreement
              without cause, the Company shall extend the Employee a loan (the
              "Loan") in an amount equal to the aggregate exercise price of the
              vested and unexercised options to purchase shares of Nogatech,
              Inc., then held by the Employee. The Loan shall bear interest and
              shall be linked to the Consumers Price Index then in effect, all
              as shall then be customary with respect to loans from employers to
              employees. The maturity date of the Loan shall be at the end of
              five (5) years following its grant. Employee shall bear all tax
              consequences in connection with the Loan.

       9.4.   During the notice period, Employee shall cooperate with the
              Company in connection with its efforts to substitute a successor
              in place of Employee and smoothly transfer Employee's
              responsibilities to such successor.

10.    MISCELLANEOUS

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       10.1.  ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
              and understanding between the parties with respect to the subject
              matters herein, and supersedes and replaces any prior agreements
              and understandings, whether oral or written between them with
              respect to such matters. For the avoidance of doubt, it is hereby
              clarified that nothing herein shall affect any of the social
              benefits accrued by the Employee prior to the date hereof pursuant
              to the employment agreement dated July, 1993. The provisions of
              this Agreement may be waived, altered, amended or repealed in
              whole or in part only upon the written consent of both parties to
              this Agreement.

       10.2.  NO IMPLIED WAIVERS. The failure of either party at any time to
              require performance by the other party of any provision hereof
              shall not affect in any way the right to require such performance
              at any time thereafter, nor shall the waiver by either party of a
              breach of any provision hereof be taken or held to be a waiver of
              any subsequent breach of the same provision or any other
              provision.

       10.3.  APPLICABLE LAW. This Agreement shall be governed by and construed
              in accordance with the laws of the State of Israel. In the event
              of any controversy or claim arising out of or relating to this
              Agreement, or breach thereof, the parties may apply solely to the
              court having jurisdiction in Tel Aviv - Jaffa, Israel.

       10.4.  NOTICES. All notices, requests, demands, instructions or other
              communications required or permitted to be given under this
              Agreement or related to it shall be in writing and shall be deemed
              to have been duly given upon delivery, if delivered personally, or
              if given by prepaid telegram, or mailed first-class postage
              prepaid, registered or certified mail, return receipt requested,
              shall be deemed to have been given two (2) days after such
              delivery, if addressed to the other party at the addresses as set
              forth on the signature page below. Either party hereto may change
              the address to which such communications are to be directed by
              giving written notice to the other party hereto of such change in
              the manner above provided.

       10.5.  NO CONFLICTING AGREEMENTS. Employee declares that he is not bound
              by any agreement, understanding or arrangement according to which
              the execution of and compliance with this Agreement may constitute
              a breach or default.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

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                                           /s/ A. Heiman
------------------------------------     ------------------------------------
NOGATECH LTD.                                      DR. ARIE HEIMAN

BY: /s/ Nathon Hod
   ---------------------------------

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                                       9

                                   Appendix B

1.   Channel error recovery.

2.   video cassette directory.<PAGE>

                                   Exhibit 10.17

                                                       Date: DECEMBER 22, 1998

Attn.: Mr. Yaron Garmazi

Dear Mr. Garmazi,

Re: EMPLOYMENT WITH NOGATECH LTD.

Nogatech Ltd. (hereinafter: the "Company") was organized in order to be a
pioneer in the field of implementing image processing technologies. On behalf
of the shareholders and management of the Company, I wish to congratulate you
in your position in the Company. For form's sake, I would like to specify
hereunder the terms of your employment with the Company:

       1.     JOB DESCRIPTION

              Your position in the Company shall be: NOGATECH INC. CFO.

              The Company shall be entitled to modify your position or impose
              additional tasks on you, at its discretion.

       2.     PERIOD OF EMPLOYMENT AND TERMINATION THEREOF

              a.     This agreement shall become effective as of FEBRUARY 1,
                     1999.

              b.     The duration of your employment is indefinite
                     (hereinafter: the "Period of Employment"). Both parties
                     may terminate the employment by written notice to the
                     other given 60 days in advance.

              c.     Notwithstanding the provisions of subsection (b) above,
                     the Company shall be entitled to dismiss you without
                     prior warning in each of the following cases:

                     1)     Commitment of a criminal offense related to work
                            and/or a flagrant offense.

                     2)     Breach of your undertaking pursuant to clause 13
                            of this agreement.

                     3)     Breach of the undertaking to maintain
                            confidentially and non-competition, attached to
                            this agreement as APPENDIX A.

              d.     Please be advised that the Company may establish and/or
                     join new activities within the framework of
                     subsidiaries, sister companies and/or

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                                       2

                     companies in which the Company shall invest money. As
                     part of the discharge of your duties, you may be
                     requested by the Company to act in additional settings
                     too, all within the scope of this agreement.

       3.     WORKING HOURS

              a.     The working week comprises a minimum of 45 working
                     hours. Should the work needs so require, you may be
                     requested, from time to time, to stay on after normal
                     working hours and to put in more than the usual
                     workload. Working overtime requires the prior written
                     approval of your supervisor.

                     It is further clarified that in cases of business travel
                     overseas, the length of the working days shall in all
                     cases be deemed as ordinary days.

       4.     SALARY

              a.     Your gross monthly salary shall be NIS 24,000
                     (hereinafter: the "Salary").

                     The following components shall be added to the Salary:

                     1)     Convalescence pay at the maximal rate granted
                            from time to time in expansion orders as in
                            effect in the labor market at the time being.

                            The convalescence pay shall be divided into
                            monthly payments to be added to your Salary each
                            month.

                            At the time hereof, this component amounts to NIS
                            _______ per month.

                            This refund is subject to the filing of a
                            monthly/periodical report in the form to be used
                            by the Company from time to time.

              b.     The Company shall deduct tax and other lawful payments
                     from your Salary.

              c.     The Salary shall be linked to the cost of living
                     increments payable in the labor market from time to
                     time, without a ceiling, and shall be updated
                     accordingly.

       5.     ANNUAL VACATION

              a.     During the first two years of the Period of your
                     Employment, you shall be entitled to an annual vacation
                     of 20 days. Thereafter, the length of the annual
                     vacation shall be extended according to the Company's

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                                       3

                     policy, as in effect from time to time, but in no case
                     will the vacation be shorter than the vacation fixed in
                     the Annual Vacation Law.

              b.     The timing of your vacation shall be coordinated with
                     your supervisor one month in advance, unless the
                     vacation shall be less than three days long, in which
                     case an advance update of one week shall suffice.

              c.     No accumulation of vacation days exceeding the vacation
                     due for two years of employment is allowed.

              d.     The Company may instruct you to go on a central
                     organized vacation concurrently with all of the
                     Company's employees, utilizing no more than one half of
                     your annual vacation.

       6.     SICK LEAVE

              Payment for sick leave shall be made subject to the provision
              of medical certificates pursuant to the Sick Leave Law.

       7.     MILITARY RESERVE DUTY

              a.     Leave for active military reserve duty requires the
                     rendering of notice to the Company upon receipt of the
                     order.

              b.     During active military reserve duty, you shall be
                     entitled to receive your Salary in full, subject to
                     provision of the appropriate confirmations upon
                     conclusion of the service.

       8.     MANAGERS' INSURANCE

              a.     The Company shall pay the following amounts to a pension
                     fund, a provident fund or managers' insurance, at the
                     choice thereof:

                     1)     8.33% of the Salary, as defined in clause 4(a),
                            for severance pay - at the Company's expense.

                     2)     5% of the Salary, as defined in clause 4(a), for
                            provident payments - at the Company's expense.

                     3)     5% of the Salary, as defined in clause 4(a), for
                            provident payments - at your expense.

              b.     The Company's payments to managers' insurance as set out
                     in subsection (a) above shall be in lieu of any other
                     duty of payment of severance pay, payments to a pension
                     fund etc.

                     In the event that the payments to be made prior to
                     termination of your employment shall not suffice in
                     order to cover the severance pay due to

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                                       4

                     you under this agreement, the Company shall complement
                     the payment within the period of time fixed in the law.

              c.     Your consent to section (b) exempts the Company from the
                     need to apply to the Minister of Labor for his approval
                     under Article 14 of the Severance Pay Law; however, if
                     such a need for an application for an appropriate permit
                     should arise, your signing of this agreement shall
                     constitute an authorization of the Company to apply for
                     the permit on your behalf too.

              d.     Should the Company be required in future, whether by law
                     or by an expansion order which shall apply to the entire
                     labor market, to make payments to another comprehensive
                     pension fund or arrangement, such payment to the new
                     applicable fund or arrangement shall be in lieu of the
                     arrangement herein, and you will not be permitted to
                     draw funds on account of the payments made within the
                     framework of the previous arrangement, but subject to
                     the regulations of the appropriate fund.

       9.     ADVANCED STUDY FUND

              During the Period of your Employment with the Company and
              subject to the General Manager's approval, the Company shall
              make payments to an advanced study fund to which you belong at
              the acceptable rate, i.e., 7.5% of the Salary, as defined in
              clause 4(a), at the Company's expense, and 2.5% at the
              employee's expense.

       10.    CONFLICT OF INTERESTS

              You shall perform no act which shall derogate from your loyalty
              to the Company and/or which may place you in a conflict of
              interests with the Company's objectives. In addition,
              throughout the term of your employment, you shall work in no
              other occupation or employment without the Company's prior
              written approval.

       11.    DECLARATION OF CONFIDENTIALITY AND NON-COMPETITION

              You undertake to maintain confidentially and non-competition,
              both during the term of your employment with the Company and
              thereafter, as specified in the undertaking of confidentially
              and non-competition of the Company in the form attached to this
              letter, marked as Appendix A and constituting an integral part
              of this letter.

       12.    DEFENSE SECRETS

              a.     Please be advised that the Company may engage, INTER
                     ALIA, in secret projects for the defense forces; you
                     therefore undertake to maintain in confidence
                     information, or defense secrets, which shall reach you,
                     both in writing and verbally, while discharging your
                     duties, and to refrain

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                                       5

                     from transferring the same to any person and/or entity,
                     unless required to do so by your duties, as imposed on
                     you.

              b.     Please be advised that should you fail to fulfill this
                     undertaking, you shall be liable for the penalties
                     prescribed by the Criminal Amendment Law (State
                     Security), 5717-1957.

       13.    PATENTS, INVENTIONS AND COMMERCIAL SECRETS

              a.     The Company shall have exclusive title to any copyright
                     to any invention or patent (related to the fields in
                     which the Company engages) which you or any Company
                     employee under your supervision shall invent during the
                     Period of your Employment with the Company, and to any
                     commercial secret related to the Company's work. The
                     Company shall be entitled to defend any invention,
                     patent or commercial secret by way of registration or
                     otherwise in Israel or elsewhere. It is clarified that
                     you will not be entitled to register the invention
                     and/or patent or commercial secret nor take any action
                     with respect thereto, save for the acts necessary for
                     the registration or utilization of the patent in the
                     name of or by the Company. The provisions of this clause
                     shall remain in effect also after termination of your
                     work for the Company and shall bind you and your lawful
                     representatives.

              b.     You undertake to notify the Company in writing of any
                     invention, patent or commercial secret which either you
                     or any Company employee under your supervision shall
                     invent, immediately upon discovery thereof.

              c.     Save as set forth in Appendix B hereof, you have no
                     interest in any invention, patent, patent application or
                     copyright.

       14.    a.     The Company's rights under this contract may be assigned.

              b.     Your undertakings under this contract may not be
                     modified and shall not be terminated, either in whole or
                     in part, but pursuant to a written document signed by an
                     authorized representative of the Company.

              c.     If any of the terms of this contract shall, for any
                     reason, be determined to be invalid or unenforceable,
                     the validity and effect of the remaining provisions of
                     the contract shall not be affected.

Upon signing this personal contract and formally joining the Company's staff,
we wish you continued satisfaction and enjoyment from your work. I hope that
our relationship will yield cooperation for many years to come, for the
benefit of yourself and of the Company, the employees and owners thereof.

Sincerely,

<PAGE>

                                       6

(-) /s/ A. Heiman
------------------------------------
                 - General Manager
Nogatech Ltd.

I have perused this letter and Appendix A hereof, and have prepared Appendix
B and I hereby express my agreement to the content of the letter and of the
Appendix.

I am aware that this letter is a special and personal contract which
regulates the relationship between the Company and myself, and that the
provisions of no other agreement, including collective agreements between the
Company and the employees thereof, shall apply to me so long as this
agreement is in force.

I am further aware that the terms of the above agreement and any conditions
which shall be in effect so long as I am employed by the Company are personal
and I undertake to maintain them in confidence.

Name:                                       Date: DECEMBER 22, 1998
      -------------------------------

I.D.:
      -------------------------------

Address:
         ----------------------------
                                        Employee's signature: (-) /s/ Y. Garmazi
-------------------------------------

IN THE EVENT THAT THE EMPLOYEE SHALL RETIRE VOLUNTARILY, AND SHALL NOT HAVE
COMMITTED AN ETHICAL VIOLATION, THE COMPANY SHALL PAY HIM THE COMPENSATION
WHICH WOULD HAVE BEEN PAYABLE TO HIM IN THE EVENT OF DISMISSAL.

THE EMPLOYEE SHALL RECEIVE A LOAN FOR THE PURCHASE OF A CAR IN THE AMOUNT OF
NIS 90,000. THE LOAN SHALL STAND FOR FIVE YEARS, AND 20% THEREOF SHALL BE
WAIVED EACH YEAR.

THE EMPLOYEE SHALL RECEIVE CAR MAINTENANCE ACCORDING TO THE "HESHEV" RATE FOR
1,500 KM PER MONTH.

<PAGE>

                                                                     APPENDIX A

Attn.: Nogatech Ltd.

Re: UNDERTAKING OF CONFIDENTIALITY AND NON-COMPETITION

Whereas       I wish to be employed by your company (hereinafter: the
              "Company"); and

Whereas       the Company is in the business of _______________________ and
              engages in projects related thereto; and

Whereas       during the term of my employment with the Company, I received
              and will receive Information, as defined hereunder:

              Any information, document, draft, process, material, commercial
              secret, formula, datum, program, plan, algorithm, patent,
              invention, whether patent-worthy or otherwise, discovery,
              innovation, improvement, research, any method, scientific
              technical development, prototype, model, picture, record,
              compact disc, tape, description, drawing, computer tape, sketch
              and any other thing or means of storage, whether in writing or
              verbal and relating to the planning and development of control
              systems, including software integrated with hardware and
              information concerning the unique matters in which the Company
              deals, and, INTER ALIA, on the subjects of
              ____________________, and matters in which the Company and/or a
              new company to be organized within the Company shall engage,
              and any information relating to the Company's customers and/or
              manufacturing or marketing facilities, except for information
              which:

              (1)    Is in the public domain or will be in the public domain
                     other than as a result of the breach of this undertaking;

              (2)    Was in my lawful possession prior to my employment;

              (3)    Constituted part of my general knowledge prior to my
                     employment;

              (hereinafter: the "Information"); and

Whereas       my undertaking to maintain confidentiality and non-competition
              is a condition precedent to my employment with the Company and
              to receipt of the Information by myself;

Therefore     I declare and undertake as follows:

<PAGE>

       PART I - CONFIDENTIALITY

       1.     To maintain the Information which has reached or shall reach me
              or become known to me, whether directly or indirectly, during
              the term of my employment with the Company and/or my
              involvement in the Company, without limitation in time, also
              after termination of my employment with the Company, in strict
              confidence.

       2.     Not to divulge and/or sell, whether for or without
              consideration and/or cause the Information to be divulged,
              whether directly or indirectly, and to take all measures in
              order to maintain the secrecy of the Information and to prevent
              the delivery or transfer thereof to any third party, person,
              entity or corporation, except to my supervisors in the Company
              or pursuant to their instructions for the purpose of
              discharging my duties as an employee of the Company.

       3.     To make no use of the Information or any part thereof for my
              needs or for the needs of others, whether directly or
              indirectly, other than for the purpose of executing my duties
              as an employee of the Company pursuant to the instructions of
              my supervisors in the Company.

       4.     To make no copies of the Information in any manner or form,
              other than pursuant to the instructions of the Company or of
              another authorized for this purpose on its behalf.

       5.     I am aware that sole title to the Information which has reached
              me or which shall reach me or become known to me in any way
              belongs to the Company and that it is the exclusive property
              thereof, and I hereby undertake to surrender thereto,
              immediately upon termination of my work for any reason, or
              immediately upon its demand at any time, any material
              containing Information, whether written or in any other form,
              which is or shall be in my possession at any time.

       6.     I am aware that the delivery of the Information and/or any part
              thereof to any third party may inflict severe damages on the
              Company, and I shall commit no act of manufacture and/or
              marketing and/or transfer and/or sale of the Information and/or
              of the products developed by you and/or existing products
              and/or products developed by myself or jointly with others,
              including customers of the Company or jointly with any third
              party, whether to your customers or to others.

       PART II - NON-COMPETITION

       7.     I undertake than from the date of termination of my work for
              the Company for any reason, I shall neither work for, nor
              maintain, nor consult, nor take part in a business competing
              with the Company, whether directly or indirectly, whether alone
              or jointly with others.

<PAGE>

              I further undertake to render no advice of any kind to such
              competing business nor be employed by such competing business,
              whether for or without remuneration, nor be directly or
              indirectly active in the management and/or operation of such
              competing business.

              This undertaking shall be valid for eighteen (18) months from
              the date of termination of my employment. For the purposes of
              this clause, "competing business" shall mean a business dealing
              with and/or marketing and/or manufacturing and/or developing
              products in which the Company shall have dealt or products in
              the process of being developed by the Company during the three
              years preceding the termination of my employment (hereinafter:
              the "Company's Products"). For the removal of doubt, the
              employee shall not be barred from working in a business dealing
              with products containing components of the same type as the
              Company's Products, so long as the employee shall not engage,
              whether directly or indirectly, in the development, manufacture
              or marketing of components which may compete with the Company's
              Products.

       PART III - VARIOUS BREACHES

       8.     In any case in which I shall breach my foregoing undertaking or
              part thereof, I shall be obliged to compensate the Company for
              all the damages and/or expenses which the Company shall incur
              due to such breach, without derogating from any other remedy
              available to you against me under any law due to the breach of
              my foregoing undertakings.

       9.     This undertaking is attached to the employment agreement signed
              between myself and the Company on ________ and constitutes an
              integral part thereof. This undertaking does not derogate from
              any undertaking imposed on me as an employee of the Company
              pursuant to the said agreement and/or any law.

       10.    I am aware that this undertaking contains limitations to which
              I shall be subject after termination of my employment with the
              Company. I am signing the same after having considered the
              matter and been given time to consult with a professional.

       ----------------------             -----------------------------
       Date                               Employee's signature

<PAGE>

                                   APPENDIX B

             Pursuant to clause 13(c) of the employment agreement

                          EMPLOYEE'S INTELLECTUAL PROPERTY

       NONE.

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