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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 22
TO SCHEDULE 14D-1
TENDER OFFER STATEMENT
(PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934)
QUICKTURN DESIGN SYSTEMS, INC.
(Name of Subject Company)
MENTOR GRAPHICS CORPORATION
MGZ CORP.
(Bidders)
COMMON STOCK, PAR VALUE $.001 PER SHARE
(including the Associated Rights)
(Title of Class of Securities)
74838E102
(CUSIP Number of Class of Securities)
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WALDEN C. RHINES
PRESIDENT AND CHIEF EXECUTIVE OFFICER
MENTOR GRAPHICS CORPORATION
8005 S.W. BOECKMAN ROAD
WILSONVILLE, OREGON 97070-7777
(503) 685-1200
(Name, Address and Telephone Number of Persons Authorized
to Receive Notices and Communications on Behalf of Bidders)
COPY TO:
JOHN J. HUBER, ESQ. CHRISTOPHER L. KAUFMAN, ESQ.
LATHAM & WATKINS LATHAM & WATKINS
1001 PENNSYLVANIA AVENUE, N.W. 75 WILLOW ROAD
WASHINGTON, DC 20004 MENLO PARK, CALIFORNIA 94025
(202) 637-2200 (650) 328-4600
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MGZ Corp., a Delaware corporation ("Purchaser"), and Mentor Graphics
Corporation, an Oregon corporation ("Parent"), hereby amend and supplement their
Tender Offer Statement on Schedule 14D-1 filed on August 12, 1998 (the
"Statement"), as amended, with respect to the offer by Purchaser to purchase all
outstanding shares of Common Stock, par value $.001 per share, of Quickturn
Design Systems, Inc., a Delaware corporation, for a purchase price of $12.125
per share, net to the seller in cash, without interest thereon, as set forth in
this Amendment No. 22. Capitalized terms used herein and not defined have the
meanings ascribed to them in the Statement.
ITEM 10. ADDITIONAL INFORMATION.
Item 10(f) of the Statement is hereby amended and supplemented by the
following:
1. On November 9, 1998, Parent issued a press release, a copy of which is
attached hereto as Exhibit (a)(42) and is incorporated herein by reference.
2. On November 10, 1998, Parent issued a press release, a copy of which is
attached hereto as Exhibit (a)(43) and is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(42) Press Release dated November 9, 1998.
(a)(43) Press Release dated November 10, 1998.
2
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SIGNATURES
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
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Dated: November 10, 1998 MENTOR GRAPHICS CORPORATION
By: /s/ GREGORY K. HINCKLEY
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Name Gregory K. Hinckley
Title: Executive Vice President, Chief Operating
Officer and Chief Financial Officer
MGZ CORP.
By: /s/ GREGORY K. HINCKLEY
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Name: Gregory K. Hinckley
Title: Secretary and Chief Financial Officer
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3
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MENTOR GRAPHICS CHARGES QUICKTURN OF MISCHARACTERIZING
JUDGE'S ORDER IN PRESS RELEASE
-- MENTOR SAYS PATENT LITIGATION IS "RED HERRING" IN MENTOR TENDER OFFER --
WILSONVILLE, OREGON, November 9, 1998 -- Mentor Graphics Corporation
(Nasdaq:MENT) stated its position that the press release of Quickturn Design
Systems, Inc. (Nasdaq:QKTN) issued earlier today intentionally mischaracterizes
the November 6, 1998 rulings of the Federal District Court for Oregon on patent
litigation between Mentor and Quickturn. In Mentor's opinion, the patent
litigation is nothing more than a "red herring" in Quickturn's effort to thwart
Mentor's all cash, fully financed tender offer for all of Quickturn's common
stock at $12.125 per share.
Mentor emphasized its view that Quickturn's press release mischaracterizes both
the actual rulings of the court and the significance of the rulings to the
ultimate outcome of the patent litigation. Mentor stated that the court granted
in part Mentor's June 1998 motion for summary judgment against Quickturn,
thereby eliminating one of Quickturn's damage theories (loss in stock value),
and denied WITHOUT PREJUDICE Mentor's motion with respect to other damages
including the new damage theories Quickturn first raised on October 5, 1998.
The court specifically granted Mentor leave to refile its summary judgment
motion after Mentor conducts discovery on Quickturn's new damage theories. The
court denied Mentor's summary judgment as to damages with respect to a single
sale to Bull S.A. in the U.S.
Mentor added that the new summary judgment motions on damages will be referred
initially to the Special Master who has been appointed in the Portland, Oregon
action. The same Special Master earlier recommended denial of all of
Quickturn's motions for summary judgment on infringement, and recommended that
the court grant summary judgment of non-infringement on one of the six Quickturn
patents.
Dr. Walden C. Rhines, President and Chief Executive Officer of Mentor Graphics,
said, "Quickturn's continued flogging of its alleged $225 million patent damage
claim ignores reality. We think it is obvious to Quickturn's stockholders how
grossly inflated and self serving Quickturn's damage claim is. We are confident
that the disclosure of the experts' reports and their underlying analyses will
make it eminently clear that
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Quickturn's claim inflated to thwart our offer to the disadvantage of any
stockholder not familiar with patent law."
As previously reported, Mentor's view of Quickturn's grossly inflated damages is
aptly summarized in the Mentor damages expert report available on a special
Mentor Web site at http://www.mentorg.com/file. In that report, the damages
expert stated that, "[It] is simply inherently incredible to claim, as
[Quickturn's expert] does, that Quickturn has and will lose $93,000,000 in
profits in the period 1996-2003 because Mentor sold five items of equipment
having a gross value of $3.5 million during the period 1995-1997. No credible
analysis can reach those damage numbers based on Mentor's limited sales."
Mentor also challenged the assertion by Quickturn in its press release that the
court's ruling on "assignor estoppel" is determinative of the patent
infringement action. The ruling, which follows a similar ruling in 1996 on a
single patent, has the effect that Mentor cannot challenge the validity of the
three patents that Mentor sold to Quickturn in 1992. The court's ruling does NOT
reach the pivotal issue of whether Meta System's hardware emulation products
infringe those patents. On these issues, the Special Master has already
recommended denial of Quickturn's summary judgment motion.
As previously announced, the Dealer Manager for the Mentor Graphics Offer is
Salomon Smith Barney. MacKenzie Partners, Inc., which is acting as proxy
solicitor for the Special Meeting and as the Information Agent for Mentor's
Offer, can be reached toll-free at 800-322-2885 or by collect call at
212-929-5500.
Mentor Graphics' Offer to Purchase and ancillary documents are available on a
Mentor Graphics World Wide Web site at http://www.mentorg.com/file. Mentor has
made the experts' reports of both companies available on a special Mentor Web
site at http://www.mentorg.com/file.
Contacts: Anne M. Wagner Roy Winnick/Todd Fogarty
Vice President, Marketing Kekst and Company
503/685-1462 212/521-4800
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MENTOR GRAPHICS ENTERS INTO DEFINITIVE $200 MILLION
LINE OF CREDIT
-- MENTOR ALSO COMMENTS ON QUICKTURN'S ANNOUNCEMENT YESTERDAY OF
PRODUCT ORDER FROM JAPANESE CUSTOMER --
WILSONVILLE, OR, NOVEMBER 10, 1998 -- Mentor Graphics Corporation (Nasdaq: MENT)
announced today that Bank of America and the Company have entered into a
definitive $200 million line of credit, in accordance with Bank of America's
August, 1998 commitment letter.
As previously announced, Mentor Graphics' tender offer to purchase all
outstanding shares of Quickturn Design Systems, Inc. (Nasdaq: QKTN) at a price
of $12.125 per share in cash expires at 12:00 Midnight, New York City time, on
Monday, November 30, 1998, unless extended. Funds from the Bank of America line
of credit, together with working capital, will be used to pay for shares
purchased pursuant to the tender offer.
Gregory K. Hinckley, Executive Vice President, Chief Operating Officer and Chief
Financial Officer of Mentor Graphics, said: "We are very pleased to have
completed the definitive agreement for this financing, the terms of which
reflect not only the quality of Mentor Graphics' business, but the merits of our
proposed acquisition of Quickturn."
Separately, Mentor Graphics today stated its view that Quickturn's recent order
from a Japanese customer for Quickturn's older CoBALT-TM- product, which it
licenses from IBM, does not represent any significant resurgence of the Asian
market for Quickturn's business, nor market acceptance of Quickturn's new
Mercury product.
Dr. Walden C. Rhines, President and Chief Executive Officer of Mentor Graphics,
emphasized that, "while this single order is to be congratulated, it hardly
represents market acceptance of Mercury over Mentor Graphics' Celaro System, a
true next-generation emulation product for testing integrated-circuit designs.
"Quickturn's sales of low-end and mid-range technology products, such as this
CoBALT-TM- sale, will not, in our view, result in enhancing stockholder value
for
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the long term or in confirming the ability of Quickturn's management to design
or deliver next-generation products," Dr. Rhines continued.
Dr. Rhines concluded: "This order does not affect Mentor Graphics' all-cash,
fully financed tender offer. We urge Quickturn's stockholders to remove the
current Quickturn directors who are responsible for erecting the obstacles to
the completion of our offer. We strongly recommend that stockholders vote
promptly the GOLD proxy to elect the five independent directors nominated by
Mentor Graphics."
Mentor Graphics' Offer to Purchase, proxy solicitation materials and related
documents are available on a Mentor Graphics World Wide Web site at
http://www.mentorg.com/file.
The Dealer Manager for the Offer is Salomon Smith Barney. The Information Agent
for the Offer is MacKenzie Partners, Inc., which can be reached toll-free at
800-322-2885 or by collect call at 212-929-5500.
Contacts: Anne M. Wagner Roy Winnick/Todd Fogarty
Vice President, Marketing Kekst and Company
503/685-1462 212/521-4800
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