Nogatech: Chipping into the IPO Market

The demand for video over the Internet is definitely growing. This makes
perfect sense to me, since I have many business colleagues and friends
across the globe. With the click of a mouse, in a manner of seconds, I can
easily videoconference with a colleague in Europe or a friend in Hawaii.

Nogatech Inc. designs, develops and markets computer chips that establish
connections between video devices across a variety of networks. These chips
are designed to provide high quality video, low power consumption and
advanced capabilities.

The price range is $14-16, the Lead Underwriter is WR Hambrecht & Co and the
proposed ticker symbol is NGTC.

Nogatechs chips and related decompression software enable real-time
transmission of signals from video sources into personal computers and
hand-held personal computing through the Universal Serial Bus (USB)
interface standard. Their chips are integrated into PC digital video
cameras, video capture devices and PC-TVs.

Nogatech began their operations in 1993; their first products were video and
sound chips embedded in PCMCIA cards. In 1998 they introduced a chip that
compresses video for transfer through the Universal Serial Bus interface to
computers. In 1999 Nogatech began selling a chip that allowed streaming of
compressed video, audio and data via the USB plug. In the third quarter of
2000 they expect to release a chip that allows cameras to take digital still
pictures when detached from computer and live video when connected to
computer.

Nogatechs products are compatible with the Windows 95, Windows 98, Windows
2000, Mac OS and Windows CE operating systems and are compatible with a wide
variety of video applications.

Although Nogatech has an office in California, their main office and
research center is located in Israel. Most of their executive officers and
directors are nonresidents of the United States. In addition, over half of
Nogatechs sales are to companies outside of the United States with a high
focus on customers in Japan and Taiwan.

Nogatech boasts a list of investors that includes the Kenwood Corporation
(12.6%), Tomen Electronics Corporation (12.6%), Holland Ventures B.V.
(11.0%), Les Fils Dreyfus & Cie S.A. (8.4%), Ophir Holdings Ltd. (8.2%),
Nomura International plc (6.9%), Docor International B.V. (5.5%) and
Inventech Ltd. (5.5%).

Nogatechs revenues have increased dramatically from $2.6 million in 1997 to
$8.9 million in 1999 with a decreasing net loss of $1.5 million in 1997 to
$1.1 million in 1999.

Nogatech has a history of improving with the times. However, as great as it
is to be on the cutting edge, it is always a risky proposition. Working
internationally has its risks too. But the companz is likely to launch its
IPO, although like most other IPOs, the valuation will likely be subdued.

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