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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
Current Report Pursuant To Section 13 Or 15(d)
Of The Securities Exchange Act Of 1934
Date of Report (Date of earliest event reported):
May 28, 1999
GATEFIELD CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE
(State of incorporation)
Commission file number 0-13244 41-1404495
(I.R.S. Employer Identification No.)
47100 BAYSIDE PARKWAY
FREMONT, CALIFORNIA 94538
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (510) 623-4400
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Item 5. OTHER EVENTS.
CONVERTIBLE NOTE FINANCING
On May 25, 1999, in connection with a convertible note financing, the Company
issued and Actel Corporation, a California Corporation ("Actel") purchased a
convertible promissory note in the aggregate principal amount of $8.0 million
(the "Note"). The Note accrues interest at 5.22% per annum, has a five-year
term and is secured by a lien against all the assets of the Company. The Note
is convertible into 420,000 shares of the Company's Series C-1 Convertible
Preferred Stock, par value $0.10 (the "Shares"). The Shares are in turn
convertible into 12,307,692 shares of the Company's common stock, or the
equivalent price of $0.65 per share of common stock. The convertible note
financing was reported by the Company in a press release dated May 25, 1999,
a copy of which is attached hereto.
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Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) Financial Statements of Business Acquired:
Not applicable.
(b) Pro Forma Financial Information:
Not applicable.
(c) Exhibits
Exhibit 4.1 Convertible Promissory Note dated May 25, 1999,
in the aggregate principle amount of $8.0 million
issued to Actel Corporation.
Exhibit 4.2 Certificate of Designations of the Preferred
Stock of GateField Corporation to be designated
Series C-1 Convertible Preferred Stock.
Exhibit 10.1 Security Agreement dated May 25, 1999 between
GateField Corporation and Actel Corporation.
Exhibit 10.2 Amendment No. 1 to the Series C Preferred Stock
Purchase Agreement dated May 25, 1999 between
GateField Corporation and Actel Corporation.
Exhibit 10.3 Amendment No. 1 to the Registration Rights
Agreement dated May 25, 1999 between GateField
Corporation and Actel Corporation.
Exhibit 10.4 Amendment No. 1 to the Product Marketing
Agreement dated May 25, 1999 between GateField
Corporation and Actel Corporation.
Exhibit 99.1 GateField Corporation's press release dated May
25, 1999, regarding the convertible note
financing with Actel Corporation.
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Exhibit 4.1
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED, OR
ASSIGNED UNLESS SO REGISTERED OR AN EXEMPTION FROM REGISTRATION UNDER SAID
ACT AND ANY APPLICABLE STATE SECURITIES LAWS IS AVAILABLE.
No. 1
GATEFIELD CORPORATION
5.22% Convertible Note Due 2004
$8,000,000.00 Fremont, California
May 25, 1999
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GateField Corporation, a Delaware corporation (the "Company"), for
value received, hereby promises to pay to Actel Corporation, or registered
assigns, the principal sum of Eight Million Dollars ($8,000,000), together
with interest (computed on the basis of a 360-day year) from the date hereof
on the unpaid balance of such principal amount from time to time outstanding
at the rate of 5.22% per annum. Interest shall accrue from the date of
issuance of this Note and shall be due and payable quarterly from the date of
issuance of this Note. All principal and any unpaid interest shall be due and
payable on May 25, 2004, or, if earlier, thirty (30) thirty days following a
Change in Ownership of the Company, as defined below.
Payment of this Note is secured by a security interest in certain
property of the Company pursuant to a security agreement of even date
herewith between the Company and Actel Corporation (the "Security Agreement").
1. CONVERSION.
(a) DEFINITIONS.
(i) "BENEFICIAL OWNER" shall be used in this Agreement as
defined in Rule 13d-3 under the Securities Exchange Act of 1934,
as amended.
(ii) "CHANGE IN OWNERSHIP" shall mean the occurrence of any one
of the following:
(A) Any Person is or shall have the right to become the
Beneficial Owner, directly or indirectly, of Voting Securities of
such party representing 50% or more of the Total Voting Power of
such party's Voting Securities.
(B) The shareholders of a party approving a merger or
consolidation of such party with any other corporation, other than
a merger or consolidation that would result in the Voting
Securities of such party outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into Voting Securities of the surviving
corporation) 50% or more of the Total Voting Power represented by
the Voting Securities of such party or such surviving corporation
outstanding immediately after such merger or consolidation.
(C) The shareholders of a party approving a plan of
dissolution or liquidation of such party or an agreement for the
sale or disposition by such party of all or substantially all of
such party's assets in one or a series of transactions.
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(iii) "CONVERSION SECURITIES" shall mean Series C-1 Preferred
Stock, each share of which shall be convertible, at the option of the
holder, into 29.304029 shares of Common Stock.
(iv) "CONVERSION PRICE" shall mean $19.047619 per share of
Conversion Securities.
(v) "PERSON" shall be used in this Agreement as defined under
Sections 3(d) and 14(d) of the Securities Exchange Act of 1934, as
amended.
(vi) "TOTAL VOTING POWER" shall mean the total number of votes
that may be cast in the election of directors at a meeting of the
shareholders of a corporation if all Voting Securities are present and
voted to the fullest extent possible at such meeting.
(vii) "VOTING SECURITIES" shall mean all securities of a
corporation entitled to vote generally in the election of directors.
(b) OPTIONAL CONVERSION. The holder of this Note has the right, at
its option, at any time and from time to time to convert all or a portion of
the outstanding principal amount of this Note and unpaid interest thereon
(the amount to be converted, the "Conversion Amount") into fully-paid and
non-assessable shares of Conversion Securities. Upon conversion of this
Note, the holder of this Note shall be entitled to a number of shares of
Conversion Securities determined by dividing (A) the Conversion Amount by (B)
the Conversion Price. Nothing contained in this Note shall be construed as
conferring upon the holder of this Note any rights as a stockholder of the
Company prior to the conversion of the Note pursuant to this Section 1(b).
(c) EXERCISE OF OPTIONAL CONVERSION. In order to exercise the
optional conversion privilege provided in Section 1(b) above, the holder of
this Note shall surrender this Note to the Company during usual business
hours at the Company's principal executive office, accompanied by written
notice in form reasonably satisfactory to the Company that the holder elects
to convert the principal amount of this Note or a portion hereof specified in
such notice. Such notice shall also state the name or names (with address) in
which the certificate or certificates for shares of capital stock that shall
be issuable on such conversion shall be issued.
(d) SURRENDER OF NOTE AND DELIVERY OF CERTIFICATES. When
surrendered for optional conversion this Note shall, unless the shares
issuable on conversion are to be issued in the same name as the name in which
this Note is then registered, be duly endorsed by or accompanied by
instruments of transfer in form reasonably satisfactory to the Company duly
executed by, the holder or his or its duly authorized attorney. As promptly
as practicable after the surrender of this Note for conversion and the
receipt of the notice specified above, the Company shall deliver or cause to
be delivered at its principal executive office to the holder a certificate or
certificates for the number of full shares issuable upon the conversion of
this Note, or portion hereof, in accordance with the provisions hereof. Such
conversion shall be deemed to have been made at the time this Note shall have
been surrendered for conversion and the notice specified above shall have
been received by the Company at its principal executive office (the
"Conversion Date"), and the holder in whose name any certificate or
certificates for shares of Convertible Securities shall be issuable upon such
conversion shall be deemed to have become on the Conversion Date the holder
of record of the shares represented thereby. If less than the entire
outstanding principal amount of this Note is being converted, a new Note
shall promptly be delivered to the holder for the unconverted principal
balance and shall be of like tenor as to all terms as the Note surrendered.
(e) FRACTIONAL SHARES. No fractional shares of Conversion
Securities shall be issuable upon conversion of this Note, but a payment in
cash will be made in respect of any fraction of a share which would otherwise
be issuable upon the surrender of this Note, or portion hereof, for
conversion. Such
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payment shall be based on the fair market value of the Conversion Securities
at the time of conversion of this Note, as determined in good faith by the
Board of Directors of the Company.
2. ANTI-DILUTION PROVISIONS. Notwithstanding anything herein to the
contrary, no adjustment or readjustment of the Conversion Price or the number
of shares of Conversion Securities or other securities issuable upon
conversion of this Note shall be made under the provisions hereof due to any
event described below if an adjustment or readjustment is made pursuant to
the Certificate of Designation of the Conversion Securities in the Conversion
Price (as defined in such Certificate of Designation) due to such event.
(a) STOCK SPLITS AND COMBINATIONS. If the Company shall at any
time subdivide the outstanding shares of Conversion Securities, the
Conversion Price then in effect immediately before that subdivision shall be
proportionately decreased, and, if the Company shall at any time combine the
outstanding shares of Conversion Securities, the Conversion Price then in
effect immediately before that combination shall be proportionately
increased. Any adjustment under this section shall become effective at the
close of business on the date the subdivision or combination becomes
effective. A dividend on any security of the Company payable in Conversion
Securities of the Company shall be considered a subdivision of Conversion
Securities for purposes of this Section 2(a) at the close of business on the
record date for the determination of holders of any security entitled to
receive such dividend.
(b) RECLASSIFICATION, EXCHANGE AND SUBSTITUTION. If the Conversion
Securities issuable on conversion of this Note shall be changed into the same
or a different number of shares of any other class or classes of stock,
whether by capital reorganization, reclassification, or otherwise (other than
a subdivision or combination of shares provided for above), the holder of
this Note shall, upon its conversion, be entitled to receive, in lieu of the
Conversion Securities which the holder would have become entitled to receive
but for such change, a number of shares of such other class or classes of
stock that would have been subject to receipt by the holder if it had
exercised its right to conversion of this Note immediately before that change.
(c) REORGANIZATIONS, MERGERS OR SALE OF ASSETS. If at any time
there shall be a capital reorganization of the Conversion Securities (other
than a subdivision, combination, reclassification, or exchange of shares
provided for elsewhere in this Note) or merger of the Company with or into
another corporation (other than a merger upon which payment of this Note is
due, unless the holder hereof waives the right to receive such payment), or
the sale of the Company's properties and assets as, or substantially as, an
entirety to any other person (other than a sale upon which payment of this
Note is due, unless the holder hereof waives the right to receive such
payment), then, as a part of such reorganization, merger or sale, lawful
provision shall be made so that the holder of this Note shall thereafter be
entitled to receive upon conversion of this Note, during the period specified
in this Note, and upon such conversion, the number of shares of stock or
other securities or property of the Company, or of the successor corporation
resulting from such merger, to which a holder of the Conversion Securities
deliverable upon conversion of this Note would have been entitled on such
capital reorganization, merger, or sale if this Note had been converted
immediately before that capital reorganization, merger, or sale. In any such
case, appropriate adjustment shall be made in the application of the
provisions of this Note with respect to the rights of the holder after the
reorganization, merger or sale to the end that the provisions of this Note
(including adjustment of the conversion price then in effect and number of
shares purchasable upon conversion of this Note) shall be applicable after
that event as nearly equivalent as may be practicable.
(d) NOTICE OF ADJUSTMENT. The Company shall promptly give written
notice of each adjustment or readjustment of the Conversion Price or the
number of shares of Conversion Securities or other securities issuable upon
conversion of this Note, by first class mail, postage prepaid, to the
registered holder of this Note at the holder's address as shown on the
Company's books. The notice shall
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state that adjustment or readjustment and show in reasonable detail the facts
on which that adjustment or readjustment is based.
(e) NO CHANGE NECESSARY. The form of this Note need not be changed
because of any adjustment in the Conversion Price or in the number of shares
of Conversion Securities issuable upon its conversion. A Note issued after
any adjustment on any partial conversion or upon replacement may continue to
express the same Conversion Price and the same number of shares of Conversion
Securities (appropriately reduced in the case of partial conversion) as are
stated on this Note as initially issued, and that Conversion Price and that
number of shares shall be considered to have been so changed as of the close
of business on the date of adjustment.
(f) RESERVATION OF STOCK. The Company covenants that it will at
all times reserve and keep available, solely for issuance upon conversion of
this Note, all shares of its Conversion Securities or other securities from
time to time issuable upon conversion of this Note and if at any time the
number of authorized but unissued shares of Conversion Securities or other
securities shall not be sufficient to effect the conversion of this Note, the
Company will take such corporate action as may, in the opinion of its
counsel, be necessary to increase its authorized but unissued shares of
Conversion Securities or other securities to such number of shares or other
securities as shall be sufficient for such purpose.
(g) NO IMPAIRMENT. Without the consent of the holders of a
majority in interest of this Note, the Company will not avoid or seek to
avoid the observance or performance of any of the terms to be observed or
performed hereunder by the Company, but will at all times in good faith
assist in the carrying out of all the provisions of this Section 2 and in the
taking of all such action as may be necessary or appropriate in order to
protect the conversion rights of the holders of this Note against impairment.
(h) NOTICES OF RECORD DATE. In the event of any taking by the
Company of a record of the holders of any class of securities for the purpose
of determining the holders thereof who are entitled to receive any dividend
or other distribution, the Company shall mail to the holder of this Note at
least ten (10) days prior to the date specified herein, a notice specifying
the date on which any such record is to be taken for the purpose of such
dividend or distribution.
(i) NOTICE. In case the Company proposes to take any action to
effect the liquidation, dissolution or winding up of the Company, then the
Company shall cause notice thereof to be mailed to the registered holder of
this Note at least ten (10) days prior to the date when such liquidation,
dissolution or winding up shall be effective.
3. NO PREPAYMENT OF PRINCIPAL.
This Note may not be prepaid in whole or in part, without the prior
written consent of the holder of this Note.
4. DEFAULT.
(a) The entire unpaid principal of this Note and all unpaid
interest then accrued on this Note shall become and be immediately due and
payable upon written demand of the holder of this Note, without any other
notice or demand of any kind or any presentment or protest, and the holder
shall have all of the rights and remedies afforded by applicable law, if any
one of the following events (each, an "Event of Default") shall occur and be
continuing at the time of such demand, whether voluntarily or involuntarily,
or, without limitation, occurring or brought about by operation of law or
pursuant to or in compliance with any judgment, decree or order of any court
or any order, rule or regulation of any governmental body:
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(i) If default shall be made in the payment of principal or
interest on this Note, and such default shall remain unremedied for thirty
(30) days; or
(ii) If the Company (A) makes a composition or an assignment
for the benefit of creditors or trust mortgage, (B) applies for, consents to,
acquiesces in, files a petition seeking or admits (by answer, default or
otherwise) the material allegations of a petition filed against it seeking
the appointment of a trustee, receiver or liquidator, in bankruptcy or
otherwise, of itself or of all or a substantial portion of its assets, or a
reorganization, arrangement with creditors or other remedy, relief or
adjudication available to or against a bankrupt, insolvent or debtor under
any bankruptcy or insolvency law or any law affecting the rights of creditors
generally, or (C) admits in writing its inability to pay its debts generally
as they become due; or
(iii) If an order for relief shall have been entered by a
bankruptcy court or if a decree, order or judgment shall have been entered
adjudging the Company insolvent, or appointing a receiver, liquidator,
custodian or trustee, in bankruptcy or otherwise, for it or for all or a
substantial portion of its assets, or approving the winding-up or liquidation
of its affairs on the grounds of insolvency or nonpayment of debts, and such
order for relief, decree, order or judgment shall remain undischarged or
unstayed for a period of thirty (30) days; or if any substantial part of the
property of the Company is sequestered or attached and shall not be returned
to the possession of the Company or such subsidiary or released from such
attachment within thirty (30) days; or
(iv) The occurrence of any event of default under the
Security Agreement after giving effect to any grace or cure period provided
for therein.
(b) Every amount overdue under this Note shall bear interest from
and after the date on which such amount first became overdue at an annual
rate that is two (2) percentage points above the rate per year specified in
the first paragraph of this Note. Such interest on overdue amounts under
this Note shall be payable on demand and shall accrue and be compounded
monthly until the obligation of the Company with respect to the payment of
such interest has been discharged (whether before or after judgment).
5. GENERAL.
(a) SUCCESSORS AND ASSIGNS. This Note, and the obligations and
rights of the Company hereunder, shall be binding upon and inure to the
benefit of the Company, the holder of this Note, and their respective heirs,
successors and assigns; PROVIDED, HOWEVER, that neither the Company nor any
holder of this Note may sell, assign, or otherwise transfer this Note or any
part hereof, except in connection with a Change in Ownership of the Company
or such holder, without the prior written consent of a majority in interest
of this Note or the Company, respectively, which consent shall not be
unreasonably withheld.
(b) CHANGES. No change in or addition to this Note may be made or
compliance with any term, covenant, agreement, condition or provision set
forth herein may be omitted or waived (either generally or in a particular
instance and either retroactively or prospectively), without the written
consent of the Company and the holder of this Note.
(c) CURRENCY. All payments shall be made in such coin or currency
of the United States of America as at the time of payment shall be legal
tender therein for the payment of public and private debts.
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(d) SET-OFF. All payments by the Company under this Note shall be
made without set-off or counterclaim and be free and clear and without any
deduction or withholding for any taxes or fees of any nature whatsoever,
unless the obligation to make such deduction or withholding is imposed by law.
(e) COSTS OF COLLECTION. The Company agrees to pay on demand all
costs of collection, including reasonable attorneys' fees, incurred by the
holder in enforcing the obligations of the Company under this Note.
(f) WAIVERS. No delay or omission on the part of the Company or
any holder in exercising any right under this Note shall operate as a waiver
of such right or of any other right, nor shall any delay, omission or waiver
on any one occasion be deemed a bar to or waiver of the same or any other
right on any future occasion.
(g) NOTICES. All notices, requests, consents and demands shall be
made in writing and shall be mailed postage prepaid, or delivered by hand, to
the Company or to the holder hereof at their respective addresses set forth
below or to such other address as may be furnished in writing to the other
party hereto:
If to the holder:
Actel Corporation
955 East Arques Avenue
Sunnyvale, California 94086
Attn: President
If to the Company:
GateField Corporation
47100 Bayside Parkway
Fremont, California 94538
Attn: President
(h) SATURDAYS, SUNDAYS, HOLIDAYS. If any date that may at any time
be specified in this Note as a date for the making of any payment of
principal or interest under this Note shall fall on Saturday, Sunday or on a
day which in Fremont, California shall be a legal holiday, then the date for
the making of that payment shall be the next subsequent day which is not a
Saturday, Sunday or legal holiday.
(i) ENTIRE AGREEMENT. This Note, together with the Security
Agreement, constitutes the entire agreement between the holder and the
Company and supersedes any prior understandings, agreements or
representations by or between the holder and the Company, written or oral,
with respect to the subject matter hereof.
(j) GOVERNING LAW. This Note shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the
internal laws (and not the law of conflicts) of the State of California.
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IN WITNESS WHEREOF, this Note has been executed and delivered as a
sealed instrument on the date first above written by the duly authorized
representative of the Company.
GATEFIELD CORPORATION
By: /s/ Timothy Saxe
-----------------------
Name: Timothy Saxe
Title: President and CEO
[Corporate Seal]
ATTEST: /s/ Lynne M. Bennett
-------------------------
Assistant Secretary
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Exhibit 4.2
CERTIFICATE OF DESIGNATIONS OF THE PREFERRED STOCK
OF
GATEFIELD CORPORATION
TO BE DESIGNATED
SERIES C-1 CONVERTIBLE PREFERRED STOCK
GATEFIELD CORPORATION, a Delaware corporation (the "Corporation"),
pursuant to authority conferred on the Board of Directors of the Corporation
by the Certificate of Incorporation and in accordance with the provisions of
Section 151 of the General Corporation Law of the State of Delaware,
certifies that the Board of Directors of the Corporation, at a meeting duly
called and held, at which a quorum was present and acting throughout, duly
adopted the following resolution:
RESOLVED: That, pursuant to the authority expressly granted to and
vested in the Board of Directors of the Corporation in accordance with the
provisions of its Certificate of Incorporation, a series of Preferred Stock
of the Corporation be and hereby is established, consisting of 500,000
shares, to be designated "Series C-1 Convertible Preferred Stock"
(hereinafter "Series C-1 Preferred Stock"); that the Board of Directors be
and hereby is authorized to issue such shares of Series C-1 Preferred Stock
from time to time and for such consideration and on such terms as the Board
of Directors shall determine; and that, subject to the limitations provided
by law and by the Certificate of Incorporation, the powers, designations,
preferences and relative, participating, optional or other special rights of,
and the qualifications, limitations or restrictions upon, the Series C-1
Preferred Stock shall be as follows:
1. DIVIDENDS.
(a) The holders of shares of Series C-1 Preferred Stock
shall be entitled to receive dividends of $0.57143 per share per annum
(subject to appropriate adjustment in the event of any stock dividend, stock
split, combination or other similar recapitalization affecting such shares),
payable only when, as and if declared by the Board of Directors. Such
dividends shall not be cumulative and no right to such dividends shall accrue
to the holders of shares of Series C-1 Preferred Stock unless declared by the
Board of Directors.
(b) The Corporation shall not declare or pay any
distributions (as defined below) on shares of Common Stock unless the
Corporation has paid or set apart dividends with respect to the Series C-1
Preferred Stock equal in the aggregate to not less than the total amount of
dividends which would have been payable with respect to the shares of Series
C-1 Preferred Stock from their respective dates of issuance if dividends
under paragraph (a) of this Section 1 were mandatory and cumulative.
(c) For purposes of this Section 1, unless the context
requires otherwise, "distribution" shall mean the transfer of cash or
property without consideration, whether by way of dividend or otherwise,
payable other than in Common Stock or other securities of the Corporation, or
the purchase or redemption of shares of the Corporation (other than
repurchases of Common Stock held by employees or directors of, or consultants
to, the Corporation upon termination of their employment or services pursuant
to agreements providing for such repurchase at a price equal to the original
issue price of such shares and other than redemptions in liquidation or
dissolution of the Corporation) for cash or property, including any such
transfer, purchase or redemption by a subsidiary of this Corporation.
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2. LIQUIDATION, DISSOLUTION OR WINDING UP; CERTAIN MERGERS,
CONSOLIDATIONS AND ASSET SALES.
(a) In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, including any
insolvency or bankruptcy proceeding affecting the Company which is not
dismissed within sixty (60) days of the filing thereof, the holders of shares
of Series C-1 Preferred Stock then outstanding shall be entitled to be paid
out of the assets of the Corporation available for distribution to its
stockholders, after and subject to the payment in full of all amounts
required to be distributed to the holders of Series B Convertible Preferred
Stock (the "Series B Preferred Stock") and the holders of any other class or
series of stock of the Corporation ranking on liquidation prior and in
preference to the Series C-1 Preferred Stock, but before any payment shall be
made to the holders of Common Stock or any other class or series of stock
ranking on liquidation junior to the Series C-1 Preferred Stock (such Common
Stock and other stock being collectively referred to as "Junior Stock") by
reason of their ownership thereof, an amount equal to the greater of (i)
$19.047619 per share (subject to appropriate adjustment in the event of any
stock dividend, stock split, combination or other similar recapitalization
affecting such shares), plus any declared and unpaid dividends, or (ii) such
amount per share as would have been payable had each such share been
converted into Common Stock pursuant to Section 4 immediately prior to such
liquidation, dissolution or winding up. If upon any such liquidation,
dissolution or winding up of the Corporation the remaining assets of the
Corporation available for distribution to its stockholders shall be
insufficient to pay the holders of shares of Series C-1 Preferred Stock the
full amount to which they shall be entitled, the holders of shares of Series
C Convertible Preferred Stock (the "Series C Preferred Stock"), the holders
of shares of Series C-1 Preferred Stock and the holders of shares of any
other class or series of stock ranking on liquidation on a parity with the
Series C-1 Preferred Stock shall share ratably in any distribution of the
remaining assets and funds of the Corporation in proportion to the respective
amounts which would otherwise be payable in respect of the shares held by
them upon such distribution if all amounts payable on or with respect to such
shares were paid in full.
(b) After the payment of all preferential amounts required
to be paid to the holders of Series B Preferred Stock, the holders of any
other class or series of stock of the Corporation ranking on liquidation on a
parity with the Series B Preferred Stock, the holders of Series C Preferred
Stock, the holders of Series C-1 Preferred Stock and the holders of any other
class or series of stock of the Corporation ranking on liquidation on a
parity with the Series C-1 Preferred Stock, upon the dissolution, liquidation
or winding up of the Corporation, the holders of shares of Junior Stock then
outstanding shall be entitled to receive the remaining assets and funds of
the Corporation available for distribution to its stockholders.
(c) In the event of any merger or consolidation of the
Corporation into or with another corporation (except one in which the holders
of capital stock of the Corporation immediately prior to such merger or
consolidation continue to hold at least 80% by voting power of the capital
stock of the surviving corporation), or the sale of all or substantially all
the assets of the Corporation, if the holders of at least 51% of the then
outstanding shares of Series B Preferred Stock so elect by giving written
notice thereof to the Corporation at least three days before the effective
date of such event, then such merger, consolidation or asset sale shall be
deemed to be a liquidation of the Corporation, and all consideration payable
to the stockholders of the Corporation (in the case of a merger or
consolidation), or all consideration payable to the Corporation, together
with all other available assets of the Corporation (in the case of an asset
sale), shall be distributed to the holders of capital stock of the
Corporation in accordance with Subsections 2(a) and 2(b) above. The
Corporation shall promptly provide to the holders of shares of Series C-1
Preferred Stock such information concerning the terms of such merger,
consolidation or asset sale and the value of the assets of the Corporation as
may reasonably be requested by the holders of Series C-1 Preferred Stock. If
the holders of the Series B Preferred Stock make such an
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election, the Corporation shall use its best efforts to amend the agreement
or plan of merger or consolidation to adjust the rate at which the shares of
capital stock of the Corporation are converted into or exchanged for cash,
new securities or other property to give effect to such election. The amount
deemed distributed to the holders of Series C-1 Preferred Stock upon any such
merger or consolidation shall be the cash or the value of the property,
rights or securities distributed to such holders by the acquiring person,
firm or other entity. The value of such property, rights or other securities
shall be determined in good faith by the Board of Directors of the
Corporation. If no notice of the election permitted by this Subsection (c)
is given, the provisions of Subsection 4(h) shall apply.
3. VOTING.
(a) Each holder of outstanding shares of Series C-1
Preferred Stock shall be entitled to the number of votes equal to the number
of whole shares of Common Stock into which the shares of Series C-1 Preferred
Stock held by such holder are then convertible (as adjusted from time to time
pursuant to Section 4 hereof), at each meeting of stockholders of the
Corporation (and written actions of stockholders in lieu of meetings) with
respect to any and all matters presented to the stockholders of the
Corporation for their action or consideration. Except as provided by law, by
the provisions of Subsection 3(b) or Subsection 3(c) below or by the
provisions establishing any other series of Preferred Stock, holders of
Series C-1 Preferred Stock and of any other outstanding series of Preferred
Stock shall vote together with the holders of Common Stock as a single class.
(b) The Corporation shall not amend, alter or repeal the
preferences, special rights or other powers of the Series C-1 Preferred Stock
so as to affect adversely the Series C-1 Preferred Stock without the written
consent or affirmative vote of the holders of a majority of the then
outstanding shares of Series C-1 Preferred Stock given in writing or by vote
at a meeting, consenting or voting (as the case may be) separately as a
class. For this purpose, without limiting the generality of the foregoing,
the authorization of any shares of capital stock on a parity with, or with
priority or preference over, the Series C-1 Preferred Stock as to the right
to receive either dividends or amounts distributable upon liquidation,
dissolution or winding up of the Corporation shall be deemed to affect
adversely the Series C-1 Preferred Stock.
4. OPTIONAL CONVERSION. The holders of the Series C-1 Preferred
Stock shall have conversion rights as follows (the "Conversion Rights"):
(a) RIGHT TO CONVERT. Each share of Series C-1 Preferred
Stock shall be convertible, at the option of the holder thereof, at any time
and from time to time, and without the payment of additional consideration by
the holder thereof, into such number of fully paid and nonassessable shares
of Common Stock as is determined by dividing $19.047619 by the Conversion
Price (as defined below) in effect at the time of conversion. The "Conversion
Price" shall initially be $0.65 per share. Such initial Conversion Price, and
the rate at which shares of Series C-1 Preferred Stock may be converted into
shares of Common Stock, shall be subject to adjustment as provided below. In
addition, any declared and unpaid dividends in respect of shares of Series
C-1 Preferred Stock surrendered for conversion shall be convertible into such
number of fully paid and nonassessable shares of Common Stock as is
determined by dividing the aggregate dollar amount of such declared and
unpaid dividends by the Conversion Price.
In the event of a notice of redemption of any shares of Series C-1
Preferred Stock pursuant to Section 5 hereof, the Conversion Rights of the
shares designated for redemption shall terminate at the close of business on
the fifth business day preceding the date fixed for redemption, unless the
redemption price is not paid when due, in which case the Conversion Rights
for such shares shall continue until such price is paid in full. In the event
of a liquidation of the Corporation, the Conversion Rights shall terminate
<PAGE>
at the close of business on the first full day preceding the date fixed for
the payment of any amounts distributable on liquidation to the holders of
Series C-1 Preferred Stock.
(b) FRACTIONAL SHARES. No fractional shares of Common Stock
shall be issued upon conversion of the Series C-1 Preferred Stock. In lieu
of any fractional shares to which the holder would otherwise be entitled, the
Corporation shall pay cash equal to such fraction multiplied by the then
effective Conversion Price.
(c) MECHANICS OF CONVERSION.
(i) In order for a holder of Series C-1 Preferred
Stock to convert shares of Series C-1 Preferred Stock into shares of Common
Stock, such holder shall surrender the certificate or certificates for such
shares of Series C-1 Preferred Stock, at the office of the transfer agent for
the Series C-1 Preferred Stock (or at the principal office of the Corporation
if the Corporation serves as its own transfer agent), together with written
notice that such holder elects to convert all or any number of the shares of
the Series C-1 Preferred Stock represented by such certificate or
certificates. Such notice shall state such holder's name or the names of the
nominees in which such holder wishes the certificate or certificates for
shares of Common Stock to be issued. If required by the Corporation,
certificates surrendered for conversion shall be endorsed or accompanied by a
written instrument or instruments of transfer, in form satisfactory to the
Corporation, duly executed by the registered holder or his or its attorney
duly authorized in writing. The date of receipt of such certificates and
notice by the transfer agent (or by the Corporation if the Corporation serves
as its own transfer agent) shall be the conversion date ("Conversion Date").
The Corporation shall, as soon as practicable after the Conversion Date,
issue and deliver at such office to such holder of Series C-1 Preferred
Stock, or to his or its nominees, a certificate or certificates for the
number of shares of Common Stock to which such holder shall be entitled,
together with cash in lieu of any fraction of a share.
(ii) The Corporation shall at all times when the
Series C-1 Preferred Stock shall be outstanding, reserve and keep available
out of its authorized but unissued stock, for the purpose of effecting the
conversion of the Series C-1 Preferred Stock, such number of its duly
authorized shares of Common Stock as shall from time to time be sufficient to
effect the conversion of all outstanding Series C-1 Preferred Stock. Before
taking any action which would cause an adjustment reducing the Conversion
Price below the then par value of the shares of Common Stock issuable upon
conversion of the Series C-1 Preferred Stock, the Corporation will take any
corporate action which may, in the opinion of its counsel, be necessary in
order that the Corporation may validly and legally issue fully paid and
nonassessable shares of Common Stock at such adjusted Conversion Price.
(iii) Subject to Subsection 4(a) above, upon any such
conversion, all declared and unpaid dividends on the shares of Series C-1
Preferred Stock surrendered for conversion shall be paid to the holders
thereof.
(iv) All shares of Series C-1 Preferred Stock which
shall have been surrendered for conversion as herein provided shall no longer
be deemed to be outstanding and all rights with respect to such shares,
including the rights, if any, to receive notices and to vote, shall
immediately cease and terminate on the Conversion Date, except only the right
of the holders thereof to receive shares of Common Stock in exchange therefor
and payment of any dividends declared but unpaid thereon. Any shares of
Series C-1 Preferred Stock so converted shall be retired and canceled and
shall not be reissued, and the Corporation (without the need for stockholder
action) may from time to time take such appropriate action as may be
necessary to reduce the authorized Series C-1 Preferred Stock accordingly.
<PAGE>
(v) The Corporation shall pay any and all issue and
other taxes that may be payable in respect of any issuance or delivery of
shares of Common Stock upon conversion of shares of Series C-1 Preferred
Stock pursuant to this Section 4. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any transfer
involved in the issuance and delivery of shares of Common Stock in a name
other than that in which the shares of Series C-1 Preferred Stock so
converted were registered, and no such issuance or delivery shall be made
unless and until the person or entity requesting such issuance has paid to
the Corporation the amount of any such tax or has established, to the
satisfaction of the Corporation, that such tax has been paid.
(d) ADJUSTMENT FOR STOCK SPLITS AND COMBINATIONS. If the
Corporation shall at any time or from time to time after the filing of this
Certificate of Designations effect a subdivision of the outstanding Common
Stock, the Conversion Price then in effect immediately before that
subdivision shall be proportionately decreased. If the Corporation shall at
any time or from time to time after the filing of this Certificate of
Designations combine the outstanding shares of Common Stock, the Conversion
Price then in effect immediately before the combination shall be
proportionately increased. Any adjustment under this paragraph shall become
effective at the close of business on the date the subdivision or combination
becomes effective.
(e) ADJUSTMENT FOR CERTAIN DIVIDENDS AND DISTRIBUTIONS. In
the event the Corporation at any time, or from time to time after the filing
of this Certificate of Designations shall make or issue, or fix a record date
for the determination of holders of Common Stock entitled to receive, a
dividend or other distribution payable in additional shares of Common Stock,
then and in each such event the Conversion Price for the filing of this
Certificate of Designations Series C-1 Preferred Stock then in effect shall
be decreased as of the time of such issuance or, in the event such a record
date shall have been fixed, as of the close of business on such record date,
by multiplying the Conversion Price for the Series C-1 Preferred Stock then
in effect by a fraction:
(1) the numerator of which shall be the total number
of shares of Common Stock issued and outstanding immediately prior to the
time of such issuance or the close of business on such record date, and
(2) the denominator of which shall be the total
number of shares of Common Stock issued and outstanding immediately prior to
the time of such issuance or the close of business on such record date plus
the number of shares of Common Stock issuable in payment of such dividend or
distribution;
PROVIDED, HOWEVER, if such record date shall have been fixed and such
dividend is not fully paid or if such distribution is not fully made on the
date fixed therefor, the Conversion Price for the Series C-1 Preferred Stock
shall be recomputed accordingly as of the close of business on such record
date and thereafter the Conversion Price for the Series C-1 Preferred Stock
shall be adjusted pursuant to this paragraph as of the time of actual payment
of such dividends or distributions; and provided further, however, that no
such adjustment shall be made if the holders of Series C-1 Preferred Stock
simultaneously receive a dividend or other distribution of shares of Common
Stock in a number equal to the number of shares of Common Stock as they would
have received if all outstanding shares of Series C-1 Preferred Stock had
been converted into Common Stock on the date of such event.
(f) ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS. In
the event the Corporation at any time or from time to time after the filing
of this Certificate of Designations shall make or issue, or fix a record date
for the determination of holders of Common Stock entitled to receive, a
dividend or other distribution payable in securities of the Corporation other
than shares of Common Stock, then and in each such event provision shall be
made so that the holders of the Series C-1 Preferred
<PAGE>
Stock shall receive upon conversion thereof in addition to the number of
shares of Common Stock receivable thereupon, the amount of securities of the
Corporation that they would have received had the Series C-1 Preferred Stock
been converted into Common Stock on the date of such event and had they
thereafter, during the period from the date of such event to and including
the conversion date, retained such securities receivable by them as aforesaid
during such period, giving application to all adjustments called for during
such period under this paragraph with respect to the rights of the holders of
the Series C-1 Preferred Stock; and provided further, however, that no such
adjustment shall be made if the holders of Series C-1 Preferred Stock
simultaneously receive a dividend or other distribution of such securities in
an amount equal to the amount of such securities as they would have received
if all outstanding shares of Series C-1 Preferred Stock had been converted
into Common Stock on the date of such event.
(g) ADJUSTMENT FOR RECLASSIFICATION, EXCHANGE, OR
SUBSTITUTION. If the Common Stock issuable upon the conversion of the Series
C-1 Preferred Stock shall be changed into the same or a different number of
shares of any class or classes of stock, whether by capital reorganization,
reclassification, or otherwise (other than a subdivision or combination of
shares or stock dividend provided for above, or a reorganization, merger,
consolidation, or sale of assets provided for below or in Subsection 2(c)
hereof) at any time or from time to time after the filing of this Certificate
of Designations, then and in each such event the holder of each such share of
Series C-1 Preferred Stock shall have the right thereafter to convert each
such share into the kind and amount of shares of stock and other securities
and property receivable upon such reorganization, reclassification, or other
change, by holders of the number of shares of Common Stock into which such
shares of Series C-1 Preferred Stock might have been converted immediately
prior to such reorganization, reclassification, or change, all subject to
further adjustment as provided herein.
(h) ADJUSTMENT FOR MERGER OR REORGANIZATION, ETC. In case
of any consolidation or merger of the Corporation with or into another
corporation or the sale of all or substantially all of the assets of the
Corporation to another corporation (other than a consolidation, merger or
sale which is covered by Subsection 2(c)) at any time or from time to time
after the filing of this Certificate of Designations, each share of Series
C-1 Preferred Stock shall thereafter be convertible (or shall be converted
into a security which shall be convertible) into the kind and amount of
shares of stock or other securities or property to which a holder of the
number of shares of Common Stock of the Corporation deliverable upon
conversion of such Series C-1 Preferred Stock would have been entitled upon
such consolidation, merger or sale; and, in such case, appropriate adjustment
(as determined in good faith by the Board of Directors) shall be made in the
application of the provisions in this Section 4 set forth with respect to the
rights and interest thereafter of the holders of the Series C-1 Preferred
Stock, to the end that the provisions set forth in this Section 4 (including
provisions with respect to changes in and other adjustments of the Conversion
Price) shall thereafter be applicable, as nearly as reasonably may be, in
relation to any shares of stock or other property thereafter deliverable upon
the conversion of the Series C-1 Preferred Stock.
(i) NO IMPAIRMENT. The Corporation will not, by amendment of
its Certificate of Incorporation or through any reorganization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms to be observed or performed hereunder by the
Corporation, but will at all times in good faith assist in the carrying out
of all the provisions of this Section 4 and in the taking of all such action
as may be necessary or appropriate in order to protect the Conversion Rights
of the holders of the Series C-1 Preferred Stock against impairment.
(j) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of
each adjustment or readjustment of the Conversion Price pursuant to this
Section 4, the Corporation at its expense shall promptly compute such
adjustment or readjustment in accordance with the terms hereof and furnish to
<PAGE>
each holder of Series C-1 Preferred Stock a certificate setting forth such
adjustment or readjustment and showing in detail the facts upon which such
adjustment or readjustment is based. The Corporation shall, upon the written
request at any time of any holder of Series C-1 Preferred Stock, furnish or
cause to be furnished to such holder a similar certificate setting forth (i)
such adjustments and readjustments, (ii) the Conversion Price then in effect,
and (iii) the number of shares of Common Stock and the amount, if any, of
other property which then would be received upon the conversion of Series C-1
Preferred Stock.
(k) NOTICE OF RECORD DATE. In the event:
(i) that the Corporation declares a dividend (or any
other distribution) on its Common Stock payable in Common Stock or other
securities of the Corporation;
(ii) that the Corporation subdivides or combines its
outstanding shares of Common Stock;
(iii) of any reclassification of the Common Stock of
the Corporation (other than a subdivision or combination of its outstanding
shares of Common Stock or a stock dividend or stock distribution thereon), or
of any consolidation or merger of the Corporation into or with another
corporation, or of the sale of all or substantially all of the assets of the
Corporation; or
(iv) of the involuntary or voluntary dissolution,
liquidation or winding up of the Corporation;
then the Corporation shall cause to be filed at its principal
office or at the office of the transfer agent of the Series C-1 Preferred
Stock, and shall cause to be mailed to the holders of the Series C-1
Preferred Stock at their last addresses as shown on the records of the
Corporation or such transfer agent, at least ten days prior to the date
specified in (A) below or twenty days before the date specified in (B) below,
a notice stating
(A) the record date of such dividend, distribution,
subdivision or combination, or, if a record is not to be taken, the date as
of which the holders of Common Stock of record to be entitled to such
dividend, distribution, subdivision or combination are to be determined, or
(B) the date on which such reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up is
expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares
of Common Stock for securities or other property deliverable upon such
reclassification, consolidation, merger, sale, dissolution or winding up.
5. REDEMPTION IN EVENT OF SERIES B PREFERRED STOCK REDEMPTION.
(a) In the event that all of the shares of the Company's
Series B Preferred Stock are redeemed by the Company pursuant to Section 5 of
the Certificate of Designations of the Series B Convertible Preferred Stock
of the Company, the holders of at least 51% of the then outstanding shares of
Series C-1 Preferred Stock may elect to either cause the Company to redeem
the shares of Series C-1 Preferred Stock, in whole or in part, at a
redemption price equal to $19.047619 per share plus declared and unpaid
dividends thereon (subject to adjustment for stock splits, stock dividends,
combinations or similar recapitalizations affecting such shares) in cash for
each share of Series C-1 Preferred Stock then redeemed (the "Redemption
Price"), PROVIDED, HOWEVER, that the holders of shares of Series C-1
Preferred Stock shall not be entitled to cause the Company to redeem the
shares of Series C-1 Preferred Stock until
<PAGE>
all the holders of shares of Series B Preferred Stock have received their
full redemption price for the shares redeemed.
(b) At least fifteen (15) days prior to the date fixed by
holders electing to redeem their shares of Series C-1 Preferred Stock
("Redeeming Holders"), for any redemption of Series C-1 Preferred Stock
(hereinafter the "Redemption Date"), the Redeeming Holders shall send the
Corporation written notice that notifies the Corporation of their election to
redeem such shares, specifying the Redemption Date and the number of shares
to be redeemed and calling upon the Corporation to pay the Redemption Price
(such notice hereinafter referred to as the "Redemption Notice"). On or prior
to the Redemption Date, each Redeeming Holder shall surrender his or its
certificate or certificates representing such shares to the Corporation, and
thereupon the Redemption Price of such shares shall be payable to the order
of the person whose name appears on such certificate or certificates as the
owner thereof and each surrendered certificate shall be canceled. In the
event less than all the shares represented by any such certificate are
redeemed, a new certificate shall be issued representing the unredeemed
shares. From and after the Redemption Date, unless there shall have been a
default in payment of the Redemption Price, all rights of the holders of the
Series C-1 Preferred Stock designated for redemption in the Redemption Notice
as holders of Series C-1 Preferred Stock of the Corporation (except the right
to receive the Redemption Price without interest upon surrender of their
certificate or certificates) shall cease with respect to such shares, and
such shares shall not thereafter be transferred on the books of the
Corporation or be deemed to be outstanding for any purpose whatsoever.
[This space left blank intentionally.]
GATEFIELD CORPORATION has caused this Certificate of Designations to
be signed by Timothy Saxe, its authorized officer, this 25th day of May, 1999.
By: /s/ Timothy Saxe
-----------------------------
Timothy Saxe
Chief Executive Officer
<PAGE>
Exhibit 10.1
SECURITY AGREEMENT
This SECURITY AGREEMENT, dated as of May 25, 1999, executed by GATEFIELD
CORPORATION, a Delaware corporation ("DEBTOR"), in favor of ACTEL
CORPORATION, a California corporation ("SECURED PARTY").
RECITALS
A. Debtor and Secured Party have entered into a Convertible Promissory
Note (the "NOTE"), dated the date hereof, in favor of Secured Party.
B. In order to induce Secured Party to extend credit pursuant to the
Note, Debtor has agreed to enter into this Security Agreement and to grant
the security interest in the Collateral described below.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Debtor hereby agrees with Secured Party as follows:
1. DEFINITIONS AND INTERPRETATION. When used in this security
agreement, the following terms shall have the following respective meanings:
"ADDITIONAL LOAN ELECTION" shall mean Debtor's election, at least ninety
(90) days prior to the date Debtor in good faith estimates that Debtor's
balances of cash and cash equivalents will be less than $1,000,000, but not
earlier than January 1, 2000, to request that Secured Party, in its sole and
absolute discretion, make an additional loan in a principal amount requested
by Debtor not to exceed $4,000,000, on the same terms as the Note, (which
loan shall be secured by the Collateral and may, at Secured Party's option,
be convertible into capital stock of Debtor on the same terms as the Note,
and if Secured Party elects that such loan be convertible, Secured Party's
obligation to make such loan shall be subject to the requirement that there
are a sufficient number of authorized and unissued shares of Debtor's capital
stock available for such conversion at the time such loan is to be made).
"COLLATERAL" shall have the meaning given to that term in Section 2
hereof.
"EMBEDDED PRODUCTS" shall have the meaning given to that term in Section
1.14 of that certain Product Marketing Agreement dated as of August 14, 1998
between Debtor and Secured Party.
"INVENTORY" shall have the meaning given to that term in Attachment 1
hereto.
"LIEN" shall mean, with respect to the Collateral, any security
interest, mortgage, pledge, lien, claim, charge or other encumbrance in, of,
or on the Collateral or the income therefrom, including, without limitation,
the interest of a vendor or lessor under a conditional sale agreement,
capital lease or other title retention agreement, or any agreement to provide
any of the foregoing, and the filing of any financing statement or similar
instrument under the Uniform Commercial Code or comparable law of any
jurisdiction.
"OBLIGATIONS" shall mean and include all loans, advances, debts,
liabilities and obligations, howsoever arising, owed by Debtor to Secured
Party of every kind and description (whether or not
<PAGE>
evidenced by any note or instrument and whether or not for the payment of
money), now existing or hereafter arising under or pursuant to the terms of
the Note or this Security Agreement, including, all interest, fees, charges,
expenses, reasonable attorneys' fees and costs chargeable to and payable by
Debtor hereunder and thereunder, in each case, whether direct or indirect,
absolute or contingent, due or to become due, and whether or not arising
after the commencement of a proceeding under Title 11 of the United States
Code (11 U.S.C. Section 101 ET SEQ.), as amended from time to time (including
post-petition interest) and whether or not allowed or allowable as a claim in
any such proceeding.
"PERMITTED LIENS" shall mean (i) Liens for taxes or other governmental
charges not at the time delinquent or thereafter payable without penalty or
being contested in good faith, provided provision is made to the reasonable
satisfaction of Secured Party for the eventual payment thereof if
subsequently found payable; (ii) Liens of carriers, warehousemen, mechanics,
materialmen, vendors, and landlords incurred in the ordinary course of
business for sums not overdue or being contested in good faith, provided
provision is made to the reasonable satisfaction of Secured Party for the
eventual payment thereof if subsequently found payable; (iii) Liens existing
as of the date hereof and identified in item 9 of Attachment 2 to this
Security Agreement; (iv) in the event Debtor requests that Secured Party make
an additional loan to Debtor pursuant to an Additional Loan Election, but
Secured Party elects not to make such additional loan, Liens in favor of any
single third party lender securing indebtedness in an aggregate amount not to
exceed the principal amount of $4,000,000 at any time outstanding; (v) Liens
in favor of Secured Party; (vi) Liens on leased equipment granted in
connection with the leasing of such equipment in favor of the lessor of such
equipment; (vii) Liens created by or resulting from any litigation or legal
proceeding which is currently being contested in good faith by appropriate
proceedings; and (viii) Liens created by or resulting from purchase money
financings.
"RECEIVABLES" shall have the meaning given to that term in Attachment 1
hereto.
"UCC" shall mean the Uniform Commercial Code as in effect in the State
of California from time to time.
All capitalized terms not otherwise defined herein shall have the
respective meanings given in the Note. Unless otherwise defined herein, all
terms defined in the UCC shall have the respective meanings given to those
terms in the UCC.
2. GRANT OF SECURITY INTEREST. As security for the Obligations,
Debtor hereby pledges and assigns to Secured Party and grants to Secured
Party a security interest in all right, title and interest of Debtor in and
to the property described in Attachment 1 hereto (collectively and severally,
the "COLLATERAL"), which Attachment 1 is incorporated herein by this
reference.
3. REPRESENTATIONS AND WARRANTIES OF DEBTOR. Debtor represents and
warrants to Secured Party that (a) Debtor is the owner of the Collateral (or,
in the case of after-acquired Collateral, at the time Debtor acquires rights
in the Collateral, will be the owner thereof) and that no other person has
(or, in the case of after-acquired Collateral, at the time Debtor acquires
rights therein, will have) any right, title, claim or interest (by way of
Lien or otherwise) in, against or to the Collateral, except for Permitted
Liens; (b) upon filing of a UCC-1 financing statement, Secured Party has (or
in the case of after-acquired Collateral with respect to which a Security
interest may be perfected in the State of California by filing under Article
9 of the California Uniform Commercial Code, at the time Debtor acquires
rights therein, will have) a perfected security interest in the Collateral,
subject to no Liens other than Permitted Liens, and additional filings have
been made or will be made with the United States Copyright Office and/or
Patent Trademark Office as are necessary to perfect the Secured Party's
security interest in ownership rights and interests of Debtor in all
copyrights, patents, and trademarks constituting Collateral; (c) all
Inventory has been (or, in the case of hereafter produced Inventory, will be)
produced in compliance in all material
<PAGE>
respects with applicable laws; (d) each Receivable represents a valid
obligation of the customers of Debtor arising from bona fide transactions
entered into in the ordinary course of business; and (e) all information set
forth in Attachment 2 hereto is true and correct.
4. REPRESENTATIVES AND WARRANTIES OF SECURED PARTY. Secured Party has
been advised that neither the Note nor the Convertible Securities issuable
upon conversion of the Note nor the Common Stock issuable upon conversion of
the Convertible Securities (collectively, the "Securities") have been
registered under the Securities Act of 1933, as amended (the "Securities
Act"), or any state securities laws and, therefore, cannot be resold unless
registered under the Securities Act and applicable state securities laws or
unless an exemption from such registration requirements is available.
Secured Party also understands that the Securities are being offered and sold
pursuant to an exemption from registration contained in the Securities Act
based in part upon Secured Party's representations contained herein. Secured
Party is aware that Debtor is under no obligation to effect any such
registration with respect to the Securities or to file for or comply with any
exemption from registration. Secured Party also understands that there is no
assurance that any exemption from registration under the Securities Act will
be available and that, even if available, such exemption may not allow
Secured Party to transfer all or any portion of the Securities under the
circumstances, in the amounts or at the times Secured Party might propose.
Secured Party is purchasing the Securities for its own account for
investment, not as a nominee or agent, and not with a view to, or for resale
in connection with, the distribution thereof. Secured Party has such
knowledge and experience in financial and business matters that Secured Party
is capable of evaluating the merits and risks of such investment, is able to
incur a complete loss of such investment and is able to bear the economic
risk of such investment for an indefinite period of time. Secured Party is
an accredited investor as such term is defined in Rule 501 of Regulation D
under the Securities Act.
5. COVENANTS RELATING TO COLLATERAL. Debtor hereby agrees (a) to
perform all acts that may be necessary to maintain, preserve, protect and
perfect the Collateral (ordinary wear and tear excepted), the Lien granted to
Secured Party therein and the first priority of such Lien, except for
Permitted Liens; (b) not to use or permit any Collateral to be used (i) in
violation of any provision herein, (ii) in any material violation of any
applicable law, rule or regulation, or (iii) in violation of any policy of
insurance covering the Collateral; (c) to pay when due all taxes and other
governmental charges, all Liens and all other charges now or hereafter
imposed upon or affecting any Collateral which, if unpaid, might become a
Lien upon the Collateral or any part thereof; (d) not to change Debtor's name
without 15 days' prior written notice to Secured Party, or Debtor's residence
or the office in which Debtor's records relating to Receivables are kept
without 15 days prior written notice to Secured Party; (e) not to keep
Collateral consisting of Inventory at any location other than the locations
set forth in item 4 of Attachment 2 hereto, except that upon at least 15 days
prior written notice to Secured Party, Debtor may move Collateral to other
locations within the United States; (f) to procure, execute and deliver from
time to time any endorsements, assignments, financing statements and other
writings reasonably deemed necessary or appropriate by Secured Party to
perfect, maintain and protect its Lien hereunder and the priority thereof;
(g) to appear in and defend any action or proceeding which may affect its
title to or Secured Party's interest in the Collateral; (h) to comply with
all material requirements of law relating to the production, possession,
operation, maintenance and control of the Collateral except for such
non-compliance as could not reasonably be expected to have a material adverse
effect on the value of any such Collateral; (i) to keep accurate and complete
records of the Collateral and to provide Secured Party with such records and
information relating to the Collateral as Secured Party may reasonably
request from time to time; (j) not to surrender or lose possession of (other
than to Secured Party), sell or otherwise dispose of or transfer any
Collateral or right or interest therein, other than (i) the sale of Inventory
and the disposal of worn-out or obsolete equipment, all in the ordinary
course of Debtor's business and (ii) the granting of licenses in Embedded
Products, and to keep the Collateral free of all Liens except Permitted
Liens; and (k) to collect, enforce and receive delivery of the Receivables in
accordance with past practice until otherwise notified by Secured Party.
<PAGE>
6. SUBORDINATION. In the event that (a) Debtor has requested that
Secured Party make an additional loan to Debtor pursuant to an Additional
Loan Election, (b) Secured Party has elected not to make such additional loan
(and Secured Party shall deemed to have elected not to make such additional
Loan to Debtor unless Secured Party notifies Debtor of its election to make
such additional loan in writing no later than ten (10) days after Secured
Party's receipt of the Additional Loan Election); and (c) Debtor has obtained
a loan from a third party lender in an aggregate principal amount not to
exceed $4,000,000, which loan is secured by a Lien described in clause (iv)
of the definition of "Permitted Lien," then Secured Party agrees to execute a
subordination agreement in favor of such third party lender, subordinating
the Lien in the Collateral provided for in this Security Agreement to such
Permitted Lien in favor of such third party lender, and which subordination
agreement shall contain such other terms and provisions as are reasonably
acceptable to Secured Party.
7. AUTHORIZED ACTION BY AGENT. Debtor hereby irrevocably appoints
Secured Party as its attorney-in-fact and agrees that Secured Party may
perform (but Secured Party shall not be obligated to and shall incur no
liability to Debtor or any third party for failure so to do) any act which
Debtor is obligated by this Security Agreement to perform, and to exercise
such rights and powers as Debtor might exercise with respect to the
Collateral, including the right to (a) collect by legal proceedings or
otherwise and endorse, receive and receipt for all dividends, interest,
payments, proceeds and other sums and property now or hereafter payable on or
on account of the Collateral; (b) enter into any extension, reorganization,
deposit, merger, consolidation or other agreement pertaining to, or deposit,
surrender, accept, hold or apply other property in exchange for the
Collateral; (c) insure, process and preserve the Collateral; (d) make any
compromise or settlement, and take any action it deems advisable, with
respect to the Collateral; (e) pay any indebtedness of Debtor relating to the
Collateral; and (f) execute UCC financing statements and other documents,
instruments and agreements required hereunder; PROVIDED, HOWEVER, that
Secured Party shall not exercise any such powers prior to the occurrence of
an Event of Default and shall only exercise such powers during the
continuance of an Event of Default. Debtor agrees to reimburse Secured Party
upon demand for any reasonable costs and expenses, including attorneys' fees,
Secured Party may incur while acting as Debtor's attorney-in-fact hereunder,
all of which costs and expenses are included in the Obligations. It is
further agreed and understood between the parties hereto that such care as
Secured Party gives to the safekeeping of its own property of like kind shall
constitute reasonable care of the Collateral when in Secured Party's
possession; PROVIDED, HOWEVER, that Secured Party shall not be required to
make any presentment, demand or protest, or give any notice and need not take
any action to preserve any rights against any prior party or any other person
in connection with the Obligations or with respect to the Collateral.
8. DEFAULT AND REMEDIES. Debtor shall be deemed in default under this
Security Agreement upon the occurrence of any of the following, each of which
shall be deemed an "Event of Default":
(a) If any Event of Default, under and as defined in the Note,
shall occur (giving effect to any grace or cure period provided for therein);
(b) If Debtor shall fail to perform any covenant to be performed
by it under this Security Agreement and such failure shall continue
unremedied or unwaived by Secured Party for a period of thirty (30) days;
(c) If this Security Agreement shall in any respect cease to be,
or Debtor shall assert that this Security Agreement or the Note is not, a
legal, valid and binding obligation of Debtor enforceable in accordance with
its terms.
<PAGE>
Upon the occurrence and during the continuance of any such Event of
Default, Secured Party shall have the rights of a secured creditor under the
UCC and applicable federal law, all rights granted by this Security Agreement
and by law, including the right to require Debtor to assemble the Collateral
and make it available to Secured Party at the location of such Collateral set
forth in item 4 of Attachment 2 and use any trademark, trade name, copyright,
patent or technical process used by Debtor in connection with any disposition
of such Collateral. Debtor hereby agrees that ten (10) days' notice of any
intended sale or disposition of any Collateral is reasonable. In furtherance
of Secured Party's rights hereunder, Debtor hereby grants to Secured Party,
an irrevocable, non-exclusive license (exercisable without royalty or other
payment by Secured Party, but only in connection with the exercise of
remedies hereunder) to use, license or sublicense any patent, trademark,
trade name, copyright or other intellectual property in which Debtor now or
hereafter has any right, title or interest together with the right of access
to all media in which any of the foregoing may be recorded or stored.
9. EMBEDDED PRODUCTS. Debtor and secured party hereby acknowledge and
agree that nothing contained herein shall prohibit or otherwise restrict
debtor from licensing the embedded products to third parties and no such
licensing shall be deemed to be an event of default hereunder.
10. MISCELLANEOUS.
(a) NOTICES. Except as otherwise provided herein, all notices,
requests, demands, consents, instructions or other communications to or upon
Debtor or Secured Party under this Security Agreement shall be by telecopy or
in writing and telecopied, mailed or delivered to each party at telecopier
number or its address set forth below (or to such other telecopy number or
address as the recipient of any notice shall have notified the other in
writing). All such notices and communications shall be effective (a) when
sent by Federal Express or other overnight service of recognized standing, on
the business day following the deposit with such service; (b) when mailed, by
registered or certified mail, first class postage prepaid and addressed as
aforesaid through the United States Postal Service, upon receipt; (c) when
delivered by hand, upon delivery; and (d) when telecopied, upon confirmation
of receipt.
SECURED PARTY:
ACTEL CORPORATION
955 East Arques Avenue
Sunnyvale, California 94086
Attn: President
Telephone:
Telecopy:
DEBTOR:
GATEFIELD CORPORATION
47100 Bayside Parkway
Fremont, California 94538
Attn: President
Telephone: 510-249-5757
Telecopy: 510-623-4484
<PAGE>
(b) NONWAIVER. No failure or delay on Secured Party's part in
exercising any right hereunder shall operate as a waiver thereof or of any
other right nor shall any single or partial exercise of any such right
preclude any other further exercise thereof or of any other right.
(c) AMENDMENTS AND WAIVERS. This Security Agreement may not be
amended or modified, nor may any of its terms be waived, except by written
instruments signed by Debtor and Secured Party. Each waiver or consent under
any provision hereof shall be effective only in the specific instances for
the purpose for which given.
(d) ASSIGNMENTS. This Security Agreement shall be binding upon
and inure to the benefit of Secured Party and Debtor and their respective
successors and assigns; PROVIDED, HOWEVER, that Debtor may not sell, assign
or delegate rights and obligations hereunder without the prior written
consent of Secured Party, and PROVIDED, FURTHER, that Secured Party may only
sell, assign or delegate its rights and obligations hereunder without the
prior written consent of Debtor to the extent permitted by the Note.
(e) CUMULATIVE RIGHTS, ETC. The rights, powers and remedies of
Secured Party under this Security Agreement shall be in addition to all
rights, powers and remedies given to Secured Party by virtue of any
applicable law, rule or regulation of any governmental authority, all of
which rights, powers, and remedies shall be cumulative and may be exercised
successively or concurrently without impairing Secured Party's rights
hereunder. Debtor waives any right to require Secured Party to proceed
against any person or to exhaust any Collateral or to pursue any remedy in
Secured Party's power.
(f) PARTIAL INVALIDITY. If at any time any provision of this
Security Agreement is or becomes illegal, invalid or unenforceable in any
respect under the law or any jurisdiction, neither the legality, validity or
enforceability of the remaining provisions of this Security Agreement nor the
legality, validity or enforceability of such provision under the law of any
other jurisdiction shall in any way be affected or impaired thereby.
(g) EXPENSES. Debtor shall pay on demand all reasonable fees and
expenses, including reasonable attorneys' fees and expenses, incurred by
Secured Party in connection with custody, preservation or sale of, or other
realization on, any of the Collateral or the enforcement or attempt to
enforce any of the Obligations which is not performed as and when required by
this Security Agreement.
(h) GOVERNING LAW. This Security Agreement shall be governed by
and construed in accordance with the laws of the State of California without
reference to conflicts of law rules (except to the extent governed by the
UCC).
(i) TERMINATION. This Security Agreement shall terminate upon
the conversion, repayment or performance in full of the Note.
[Remainder of page intentionally left blank]
<PAGE>
IN WITNESS WHEREOF, Debtor has caused this Security Agreement to be executed as
of the day and year first above written.
GATEFIELD CORPORATION, A DELAWARE
CORPORATION, as Debtor
By: /s/ Timothy Saxe
-----------------------------
Name: Timothy Saxe, President and CEO
AGREED:
ACTEL CORPORATION, A CALIFORNIA CORPORATION,
as Secured Party
By: /s/ Esmat Z. Hamdy
-------------------------------
Name: Esmat Z. Hamdy
Title: Senior VP Technology and Operations
<PAGE>
Exhibit 10.2
AMENDMENT NO. 1
TO SERIES C PREFERRED STOCK PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 amends that certain Series C Preferred Stock
Purchase Agreement by and between GateField Corporation ("GateField") and Actel
Corporation ("Actel") dated as of August 14, 1998 (the "Agreement").
GateField and Actel hereby agree to amend the Agreement as follows:
1. RIGHT OF FIRST REFUSAL. Amend section 4.7(a) of the agreement by
deleting the second sentence and substituting the following in lieu thereof:
The Purchaser's pro rata share, for purposes of this Section
4.7, shall equal a fraction, the numerator of which is the sum
of (1) the number of shares of common stock then held by such
Purchaser, (2) the number of shares of common stock issuable
upon conversion of shares of Preferred Stock then held by such
Purchaser, (3) the number of shares of common stock issuable at
any time upon exercise and/or conversion of convertible notes
then held by such Purchaser, and (4) the number of shares of
common stock issuable upon exercise and/or conversion of other
convertible securities, options, rights or warrants then held by
such Purchaser, and the denominator of which is the sum of (1)
the total number of shares of common stock then outstanding, (2)
the total number of shares of common stock issuable upon
conversion of preferred stock then outstanding, (3) the total
number of shares of common stock issuable at any time upon
exercise and/or conversion of convertible notes then
outstanding, and (4) the total number of shares of common stock
issuable upon exercise and/or conversion of all other
convertible securities, options, rights and warrants then
outstanding.
Except as amended hereby, the provisions of the Agreement shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 by their respective duly authorized representatives as of May
25, 1999.
GATEFIELD CORPORATION ACTEL CORPORATION
By: /s/ Timothy Saxe By: /s/ Esmat Z. Hamdy
------------------------ ------------------------
Name: Timothy Saxe Name: Esmat Z. Hamdy
Title: President and CEO Title: Sr. VP Technology & Operations
<PAGE>
Exhibit 10.3
AMENDMENT NO. 1
TO REGISTRATION RIGHTS AGREEMENT
THIS AMENDMENT NO. 1 amends that certain Registration Rights
Agreement by and between GateField Corporation ("GateField") and Actel
Corporation ("Actel") dated as of August 14, 1998 (the "Agreement").
GateField and Actel hereby agree to amend the Agreement as follows:
1. REGISTRABLE SECURITIES. Amend the definition of
"registrable securities" in section 1 of the agreement to read in its
entirety as follows:
"Registrable Securities" shall mean: (i) the Shares, (ii) any
shares of Common Stock, and any other securities, acquired by
the Purchaser pursuant to the exercise and/or conversion of
convertible notes, (iii) any shares of Common Stock, and any
other securities, acquired by the Purchaser pursuant to
Section 4.7 of the Stock Purchase Agreement, and (iv) any
other shares of Common Stock issued in respect of such shares
(because of stock splits, stock dividends, reclassifications,
recapitalizations, or similar events).
Except as amended hereby, the provisions of the Agreement shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 by their respective duly authorized representatives as of May
25, 1999.
GATEFIELD CORPORATION ACTEL CORPORATION
By: /s/ Timothy Saxe By: /s/ Esmat Z. Hamdy
-------------------------- --------------------------
Name: Timothy Saxe Name: Esmat Z. Hamdy
Title: President and CEO Title: Sr. VP Technology & Operations
<PAGE>
Exhibit 10.4
AMENDMENT NO. 1
TO PRODUCT MARKETING AGREEMENT
THIS AMENDMENT NO. 1 amends that certain Product Marketing Agreement by
and between GateField Corporation ("GateField") and Actel Corporation
("Actel") dated as of August 14, 1998 (the "Agreement").
GateField and Actel hereby agree to amend the Agreement as follows:
1. TERM. Amend Section 14.1 by deleting from the end thereof "before
the third anniversary of the Effective Date" and substituting in lieu thereof
"until three years after Product Qualification of the first member of a
Standard Product on a standard process that Siemens or another independent
wafer manufacturer qualifies for its own products and has committed to
support for the production forecast or until a replacement process is
qualified and yielding at similar or improved levels".
2. PRODUCT QUALIFICATION FEE. Amend Section 4.2 by inserting before
the final period ", whether or not the process is qualified by Siemens or
another independent wafer manufacturer for its own products".
3. WAIVER OF GATEFIELD MANAGEMENT RIGHTS. Amend Section 5.2.1 by
inserting at the end thereof: "GateField agrees to waive its rights to
manage, control, and direct all activities of the SBU under this Section
5.2.1, PROVIDED, HOWEVER, that Actel shall seek GateField's advice and
consent regarding the corrective actions to be taken with respect to Actel's
failure to meet or maintain 'GFIN' thresholds, and PROVIDED FURTHER that this
waiver shall terminate upon a Change in Ownership of Actel or upon Actel's
failure to use commercially reasonable efforts to achieve the Actel
Milestones."
4. WAIVER OF ACTEL MANAGEMENT RIGHTS. Amend Section 6.2.1 by
inserting at the end thereof: "Actel agrees to waive its rights to manage,
control, and direct the activities of the non-performing department of
GateField under this Section 6.2.1, PROVIDED, HOWEVER, that GateField shall
seek Actel's advice and consent regarding the corrective actions to be taken
with respect to GateField's failure to meet or maintain 'ACIN' thresholds,
and PROVIDED FURTHER that this waiver shall terminate upon a Change in
Ownership of GateField or upon GateField's failure to use commercially
reasonable efforts to achieve the GateField Milestones."
5. ENGINEERING ASSISTANCE. Delete Section 9.10 and substitute the
following in lieu thereof:
9.10 ACTEL ENGINEERING ASSISTANCE. Actel shall provide
GateField, free of charge, with such engineering assistance
as GateField may reasonably request in the areas of testing
(up to a total of two man years), yield improvement (up to a
total of one man year), silicon design (up to a total of one
man year), and software development (up to a total of two
man years).
Except as amended hereby, the provisions of the Agreement shall remain
in full force and effect.
<PAGE>
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 by their respective duly authorized representatives as of May
25, 1999.
GATEFIELD CORPORATION ACTEL CORPORATION
By: /s/ Timothy Saxe By: /s/ Esmat Z. Hamdy
------------------------------ ------------------------------
Name: Timothy Saxe Name: Esmat Z. Hamdy
Title: President and CEO Title: Sr. VP Technology & Operations
<PAGE>
Exhibit 99.1
[ACTEL LOGO] [GATEFIELD LOGO]
COMPANY CONTACTS:
Hank Perret (Reader Contact) Jim Boyd (Reader Contact)
Don Davis (Media Contact) Peter Feist (Media Contact)
Actel Corporation GateField Corporation
(408) 739-1010 (510)-249-5757
[email protected] [email protected]
http://www.actel.com http://www.gatefield.com
FOR IMMEDIATE RELEASE
ACTEL PROVIDES GATEFIELD WITH $8 MILLION IN NEW FUNDING
With the Purchase of GateField's Convertible Note, Actel Corporation Raises
Its Stake in Flash ProASIC-TM- FPGA Partner
FREMONT, CALIF., AND SUNNYVALE, CALIF., MAY 25, 1999 - Actel Corporation
(Nasdaq: ACTL) of Sunnyvale, Calif. and GateField Corporation (OTCBB: GATE)
of Fremont, Calif. jointly announced today that Actel has provided GateField
with $8 million of capital in exchange for a promissory note that is
convertible into 420,000 shares of Series "C-1" preferred stock of GateField.
The $8 million note carries an annual interest rate of 5.22%, is secured by
all of GateField's assets, and is convertible at Actel's option any time
during the five-year term. Upon issuance, the Series "C-1" preferred stock
would be convertible into 12,307,692 shares of GateField common stock at
$0.65 per share.
"GateField's Flash-based ProASIC products provide a unique and exciting
programmable solution for a large and growing segment of the logic market,"
said John East, president and CEO of Actel. "Actel believes there is
tremendous potential for growth of Flash-based reprogrammable devices and is
delighted to now be even more closely associated with GateField and this
technology."
"We expect that ProASIC technology will make a real impact in the
programmable logic market," said Tim Saxe, president and CEO of GateField.
"Actel's increased investment is further proof of their commitment to our
product technology and demonstrates our excellent working relationship and
the value of our partnership."
<PAGE>
Actel is the leading manufacturer of FPGA integrated circuits using antifuse
technology. GateField is the developer of ProASIC products, the first FPGAs
based on embedded Flash technology. As part of an earlier agreement with
GateField, Actel became the exclusive sales and marketing partner for future
GateField standard ProASIC products, including 0.25-micron Flash ProASIC
FPGAs, which the companies plan to introduce later this year.
SAFE HARBOR STATEMENT
THIS NEWS RELEASE CONTAINS "FORWARD LOOKING STATEMENTS," WHICH ARE MADE
PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995. "FORWARD-LOOKING STATEMENTS" DESCRIBE FUTURE
EXPECTATIONS, PLANS, RESULTS, OR STRATEGIES, AND ARE GENERALLY PRECEDED BY
WORDS SUCH AS "FUTURE" OR "FORWARD-LOOKING," "PLAN" OR "PLANNED," "WILL" OR
"SHOULD," "ANTICIPATES," "EXPECTS," OR "PROJECTED." INVESTORS ARE CAUTIONED
THAT SUCH STATEMENTS ARE SUBJECT TO A MULTITUDE OF RISKS AND UNCERTAINTIES
THAT COULD CAUSE FUTURE CIRCUMSTANCES, EVENTS, OR RESULTS TO DIFFER
MATERIALLY FROM THOSE PROJECTED IN THE FORWARD-LOOKING STATEMENTS, INCLUDING
THE RISKS THAT PROASIC 0.25-MICRON FLASH FPGA DEVICES WILL NOT BE
COMMERCIALIZED AS SOON AS CURRENTLY ANTICIPATED OR AT ALL, OR THAT SUCH
DEVICES WILL ACHIEVE MARKET ACCEPTANCE. FOR A DISCUSSION OF OTHER FACTORS
THAT COULD AFFECT THE ACCURACY OF THE FORWARD-LOOKING STATEMENTS, PLEASE SEE
"RISK FACTORS" IN ACTEL'S AND GATEFIELD'S MOST RECENT FORMS 10-K AND 10-Q,
WHICH WILL BE PROVIDED FREE OF CHARGE UPON REQUEST. THESE FACTORS SHOULD BE
CONSIDERED IN EVALUATING THE FORWARD-LOOKING STATEMENTS INCLUDED HEREIN, AND
UNDUE RELIANCE SHOULD NOT BE PLACED ON SUCH STATEMENTS. THE FORWARD-LOOKING
STATEMENTS ARE MADE AS OF THE DATE HEREOF, AND ACTEL AND GATEFIELD UNDERTAKE
NO OBLIGATION TO UPDATE SUCH STATEMENTS.
ABOUT ACTEL
Actel is dedicated to becoming the field programmable gate array (FPGA)
provider of choice. The company's FPGAs are used by manufacturers of
communications, computer, consumer, industrial control, military/aerospace
and other electronic systems to bring complex, high-density digital designs
rapidly to market. Actel, the world's leading supplier of FPGAs based on
antifuse technology, is readying new FPGA families based on Flash and SRAM
technologies. The company is traded on the Nasdaq National Market under the
symbol ACTL and is located at 955 East Arques Avenue, Sunnyvale, California,
94086-4533. Telephone: (888) 99-ACTEL (992-2835). Internet:
http://www.actel.com
ABOUT GATEFIELD
GateField Corporation developed the revolutionary, patented Flash-based
re-programmable gate array technology and architecture upon which its ProASIC
family of high gate count, non-volatile, re-programmable products are built.
The company is located at 47100 Bayside Parkway, Fremont, CA 94538-9942. The
company can be reached by phone at 800-818-5052 or 510-249-5757, or on the
Internet at http://www.gatefield.com.
# # #
Editor's Note: The Actel name and logo are registered trademarks of Actel
Corporation. The GateField and ProASIC names and logos are trademarks of
GateField Corporation. All other trademarks and servicemarks are the property
of their respective owners.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GATEFIELD CORPORATION
/s/ Timothy Saxe
-------------------------------------
Timothy Saxe
President and Chief Operating Officer
/s/ James Boyd
-------------------------------------
James Boyd
Chief Accounting Officer
Dated: May 28, 1998
