<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [_]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, For Use of the
[_] Definitive Proxy Statement Commission Only (as permitted
[_] Definitive Additional Materials by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to Rule 14a-12
QUICKTURN DESIGN SYSTEMS, INC.
(Name of Registrant as Specified In Its Charter)
CADENCE DESIGN SYSTEMS, INC.
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
PRELIMINARY PROXY STATEMENT
-SUBJECT TO COMPLETION-
PRELIMINARY COPY
PROXY STATEMENT
OF
CADENCE DESIGN SYSTEMS, INC.
IN OPPOSITION TO THE SOLICITATION OF
MENTOR GRAPHICS CORPORATION AND
MGZ CORP.
SPECIAL MEETING OF STOCKHOLDERS
JANUARY 8, 1999
Cadence Design Systems, Inc. may have discussions with certain holders of
outstanding shares of the common stock, $0.001 par value ("Quickturn Common
Stock"), of Quickturn Design Systems, Inc. ("Quickturn"), a Delaware
corporation, in connection with the Special Meeting of Stockholders of
Quickturn, to be held at 8:00 a.m., PST, on January 8, 1999, at the offices of
Wilson Sonsini Goodrich & Rosati at 650 Page Mill Road, Palo Alto, California,
and at any adjournment, postponement or continuation thereof (the "Special
Meeting"). The phone number at that location is (650) 493-9300.
This Proxy Statement (the "Proxy Statement") will be furnished to such
holders of Quickturn Common Stock if deemed necessary to comply with the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
THIS SOLICITATION IS BEING MADE BY CADENCE DESIGN SYSTEMS, INC.
This Proxy Statement is furnished by Cadence Design Systems, Inc.
("Cadence") in opposition to the solicitation by Mentor Graphics Corporation, an
Oregon corporation ("Mentor"), and MGZ Corp., a Delaware corporation and a
wholly-owned subsidiary of Mentor ("MGZ"), pursuant to a Proxy Statement of
Mentor and MGZ dated September 11, 1998, as amended, to the extent valid, or any
subsequent proxy statement of Mentor and/or MGZ (in either case, the "Mentor
Proxy Statement"), of proxies to be used at the Special Meeting. This Proxy
Statement is first being sent or delivered on January 5, 1999 to certain
stockholders of record of Quickturn as of the Record Date (as defined below).
Quickturn has entered into an Agreement and Plan of Merger (the "Merger
Agreement") dated as of December 8, 1998, as amended on December 16, 1998, with
Cadence and a wholly-owned subsidiary of Cadence. Pursuant to such agreement,
it is proposed that Quickturn will merge with a wholly-owned subsidiary of
Cadence in a tax-free, stock-for-stock transaction, and the stockholders of
Quickturn will receive Cadence common stock with a value of $14.00 per share at
the time of closing of the merger. Quickturn has also entered into a Stock
Option Agreement dated as of December 8, 1998 with Cadence, pursuant to which
Quickturn issued
<PAGE>
Cadence an option to purchase approximately 19.9% of the outstanding Quickturn
Common Stock at $14.00 per share, which option will become exercisable under
certain conditions discussed below. These agreements are currently the subject
of litigation between Quickturn and Cadence, on the one hand, and Mentor on
the other, and between Quickturn and certain of its stockholders. For a
further discussion of the Delaware litigation referred to above, the other
litigation between Quickturn and Mentor or relating to the unsolicited tender
offer by MGZ to purchase Quickturn Common Stock, as revised, or the proposed
transaction between Quickturn and Cadence and the litigation relating thereto,
see Quickturn's various filings with the Securities and Exchange Commission
(the "SEC"), including sections entitled "Certain Legal Proceedings" in
Quickturn's Schedules 14D-9 and 14A.
GENERAL/REVOCABILITY OF PROXY
As described in the Quickturn Proxy Statement, any stockholder who has
given a gold proxy to Mentor in connection with the Mentor Proxy Statement may
revoke it at any time before it is voted by delivering to Quickturn, c/o Morrow
& Co., Inc., a duly executed BLUE Proxy Card from Quickturn bearing a date LATER
than the proxy delivered to Mentor. Proxies may also be revoked at any time
prior to voting by (i) delivering to Quickturn, c/o Morrow & Co., Inc., a
written notice, bearing a later date than the proxy, stating that the proxy is
revoked (such revocation may be in any form, but must be signed and dated and
must clearly express your intention to revoke your previously executed proxy),
(ii) signing and delivering prior to the vote at the Special Meeting a proxy
with respect to the same shares and bearing a date later than the date of the
proxy being revoked, or (iii) attending the Special Meeting and voting in person
(although attendance at the Special Meeting will not, by itself, constitute a
revocation of your proxy). Revocations of proxies and other instruments
revoking proxies may be delivered to Quickturn by fax or by mail (using the
envelope provided with Quickturn Proxy Statement), to Morrow & Co., Inc., 445
Park Avenue, New York, New York, 10022, Fax: (212) 754-8362.
Only holders of Quickturn Common Stock of record at the close of business
on November 10, 1998 (the "Record Date") are entitled to vote at the Special
Meeting. On the Record Date, 18,088,298 shares of Quickturn Common Stock were
outstanding. Each share of Quickturn Common Stock is entitled to one vote on
the matters to be considered at the Special Meeting.
BACKGROUND
UNSOLICITED TENDER OFFER FOR QUICKTURN
On August 12, 1998, MGZ initiated an unsolicited tender offer to purchase
all outstanding shares of Quickturn Common Stock for $12.125 per share. The
tender offer is currently scheduled to remain open to Quickturn stockholders
until January 11, 1999.
On December 28, 1998, Mentor announced that it was reducing the number of
shares being sought in its unsolicited tender offer all shares of Quickturn
Common Stock to 2,100,000 shares and increasing its offering price for such
reduced number of shares to $14.00 cash per
<PAGE>
share from $12.125 cash per share (the "Reduced Offer"). Mentor stated that
the Reduced Offer, if successfully consummated and when combined with Mentor's
current holdings, would result in Mentor holding approximately 14.9% of the
outstanding shares of Quickturn Common Stock.
On December 28, 1998, Quickturn's Board of Directors (the "Quickturn
Board") met with its financial and legal advisors to consider the Reduced Offer.
On December 29, 1998, the Quickturn Board met again with its financial and
legal advisors to consider the Reduced Offer and, at the conclusion of such
meeting, determined that the Reduced Offer is not in the best interests of
Quickturn and its stockholders. As described in Quickturn's Schedule 14D-9,
Amendment No. 32, filed with the SEC on December 30, 1998, in determining that
the Reduced Offer is not in the best interests of Quickturn and its
stockholders, and in making its recommendation that Quickturn stockholders
reject the Reduced Offer, the Quickturn Board considered the following reasons
and factors:
. The Quickturn Board determined that the Reduced Offer, which is limited to
an offer to purchase 2,100,000 shares, purports to be part of a process
pursuant to which Mentor proposes to undertake a "proposed second-step
merger." As expressed in its announcement of the Reduced Offer, Mentor's
proposal for a second-step merger is highly conditional in nature. The
Quickturn Board noted that these conditions include, among other things, a
legal ruling invalidating certain provisions of the Merger Agreement, the
negotiation of a merger agreement between Quickturn and Mentor and
completion of due diligence. The Quickturn Board believes that these
conditions are highly unlikely to be satisfied.
. The Quickturn Board noted that Mentor did not state that it has sufficient
financing to complete its second-step merger, and the Quickturn Board
believes it is not at all certain that Mentor can finance a transaction to
acquire all of Quickturn's outstanding stock and fulfill other commitments
required under the Merger Agreement. Accordingly, the Quickturn Board
determined that there was significant uncertainty concerning whether a
second-step merger with Mentor could occur, as well as what the
consideration in such a transaction would be.
. The Quickturn Board determined that the Reduced Offer could interfere with
or threaten Quickturn's proposed transaction with Cadence, which the
Quickturn Board determined again to be in the best interests of Quickturn
stockholders. The Quickturn Board noted that the Reduced Offer purported to
be a first step of a multi-step transaction that conflicts with the
proposed combination with Cadence.
. The Quickturn Board noted that Mentor's ownership of 14.9% of the Quickturn
Common Stock, as well as its obtaining control of the Quickturn Board,
could raise serious concerns about Quickturn's ability to engage in any
"pooling-of-interests" transaction, including the proposed combination with
Cadence.
. The Quickturn Board continues to believes that, even assuming Mentor could
make a firm offer to acquire all of the Quickturn Common Stock at a price
consistent with its
<PAGE>
conditional proposal, the strategic combination with Cadence provides
substantial and superior short- and long-term value for Quickturn, its
stockholders, employees and customers. In particular, the Quickturn Board
continues to believe that the Cadence transaction offers substantial
strategic benefits to Quickturn which far exceed the consideration proposed
by Mentor.
. The Quickturn Board considered potential antitrust issues raised by the
Cadence transaction. In this regard, the Quickturn Board continues to
believe that the transaction does not raise significant antitrust issues.
. The Quickturn Board considered the potential harm to Quickturn, as well as
Quickturn's employees and customers, if Mentor were to become a 14.9%
stockholder of Quickturn. In this regard, given the litigation and
competition between Quickturn and Mentor, the Quickturn Board considered
the potential negative impact on Quickturn if Mentor were to become a large
stockholder of Quickturn.
The Quickturn Board of Directors unanimously recommended that Quickturn
stockholders reject the revised unsolicited proposal by Mentor to acquire a
14.9% stake in Quickturn. The Quickturn Board continues to recommend that
stockholders not tender their shares to Mentor, and urges Quickturn stockholders
who may have tendered to withdraw their shares.
WHY CADENCE OPPOSES THE MENTOR OFFER AND THE MENTOR PROPOSALS
As the Quickturn Board has stated, the combination of Quickturn with
Cadence will enable Quickturn stockholders to enjoy the benefits of Cadence's
proven business strategy, strong balance sheet and excellent track record in
acquiring and integrating companies. Cadence feels very strongly about the
advantages of combining the complementary product offerings, development efforts
and marketing strengths of Cadence with those of Quickturn. Cadence believes
the proposed merger is truly a strategic combination in which the whole will be
greater than the sum of the parts.
Despite Quickturn's proposed strategic merger with Cadence, Mentor persists
in soliciting your vote to replace the Quickturn Board with its own handpicked
slate of director nominees and in making the Reduced Offer. The Quickturn Board
has determined that Mentor's Reduced Offer is inadequate and that Mentor's
proposal is not in the best interests of Quickturn and its stockholders.
CERTAIN INFORMATION ABOUT CADENCE/ INTEREST OF
CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
AND RELATED ADDITIONAL INFORMATION
Cadence is a corporation organized under the laws of the State of Delaware.
Its business address is 2655 Seely Avenue, San Jose, California 95134. The
principal business of Cadence is
<PAGE>
the development, manufacture and sale of electronic design automation software
technology and provision of professional services in connection therewith.
On December 8, 1998, Quickturn, Cadence and CDSI Acquisition, Inc., a
Delaware corporation and wholly-owned subsidiary of Cadence ("Acquisition"),
entered into the Merger Agreement, pursuant to which (upon satisfaction or
waiver of certain conditions) Acquisition will be merged with and into Quickturn
(the "Merger") and Quickturn will become the surviving corporation and a wholly-
owned subsidiary of Cadence. Each of the shares of Quickturn Common Stock
(excluding any in treasury or held by Cadence or any of its subsidiaries) issued
and outstanding (together with the associated preferred share purchase rights
issued under Quickturn's Preferred Shares Rights Agreement, dated as of January
10, 1996, between Quickturn and BankBoston, N.A., as rights agent, as amended)
will be converted into shares of common stock of Cadence (with the appropriate
number of Cadence's preferred stock purchase rights as provided in Cadence's
Rights Agreement, dated as of February 9, 1996, between Cadence and Harris Trust
and Savings Bank, as rights agent, whether or not such rights shall still
be attached to such shares). Quickturn and Cadence also entered into a Stock
Option Agreement granting Cadence an option (the "Option") to purchase up to
19.99% of the outstanding Quickturn Common Stock. As a result, Cadence is the
beneficial owner of 3,619,100 shares of Quickturn Common Stock, or 19.99% of the
shares outstanding, based upon 18,095,580 shares of Quickturn Common Stock
outstanding as of November 30, 1998 (as represented by Quickturn in the Merger
Agreement) and assuming exercise of the Option.
The Option is exercisable only upon the occurrence of certain events,
including, without limitation: (1) a recommendation by Quickturn's Board of
Directors to its stockholders of a Superior Proposal (as defined in the Merger
Agreement), (2) the withdrawal by Quickturn's Board of Directors of its approval
of the Merger, (3) the failure of Quickturn to use all reasonable efforts to
convene a stockholders' meeting to vote on the Merger, (4) in certain
circumstances, the failure to obtain stockholder approval after a duly convened
meeting, or (5) following termination of the Merger Agreement for certain
specified reasons, an agreement between Quickturn and a third party relating to
certain business combinations with a third party or a third party's acquisition
of certain assets of Quickturn. In addition, under certain circumstances,
including any person's acquisition of thirty percent (30%) or more of the
outstanding Quickturn Common Stock or a written definitive agreement between
Quickturn and a third party for certain business combinations prior to the
expiration date of the Option, Cadence may require Quickturn to cancel the
option and pay a cancellation amount. In some instances, Quickturn may require
Cadence to sell to Quickturn any shares of Quickturn Common Stock received by
Cadence upon exercise of the Option. Cadence is limited in the total payments
it may receive in connection with its exercise of the Option to $14.075 million,
minus any amounts it receives (other than for expense reimbursements) upon
termination of the Merger Agreement. Cadence does not know of any event that
has occurred as of the date hereof that would allow Cadence to exercise its
Option.
The Option Agreement will expire upon the earlier of (i) the Effective Time
of the Merger (as defined in the Merger Agreement) and (ii) the twelve (12)
month anniversary of the termination of the Merger Agreement in accordance with
the terms thereof.
<PAGE>
In the past, Cadence has been a customer of Quickturn in the ordinary
course and has entered into arms-length purchase agreements with Quickturn for
products and services. Cadence does not believe such agreements, individually
or in the aggregate, to constitute material agreements of Cadence.
Except as described herein, neither Cadence, nor to Cadence's knowledge,
any of its associates, (i) has engaged in or has a direct or indirect interest
in any transaction or series of transactions since the beginning of Quickturn's
last fiscal year or in any currently proposed transaction, to which Quickturn or
any of its subsidiaries is a party where the amount involved was in excess of
$60,000, (ii) is the beneficial or record owner of any securities of Quickturn
or any parent or subsidiary thereof, (iii) is the record owner of any securities
of Quickturn of which it may not be deemed to be the beneficial owner, (iv) has
been within the past year, a party to any contract, arrangement or understanding
with any person with respect to any securities of Quickturn or (v) has any
agreement or understanding with respect to future employment by Quickturn or any
arrangement or understanding with respect to any future transactions to which
Quickturn will or may be a party.
In connection with the execution of the Merger Agreement, Cadence entered
into employment agreements with Quickturn's President, Keith R. Lobo, and
certain other Quickturn employees (the "Employees"). Each employment agreement
commences at the consummation of the Merger for a term of eighteen months (the
"Employment Period"). During the Employment Period, Mr. Lobo and each of the
other Employees will serve the surviving corporation in a capacity
functionally equivalent to his current position with Quickturn and will be
entitled to an annual base salary and bonus (based on a percentage of base
salary) specified in the employment agreement. In addition to his cash
compensation, each Employee will be entitled to receive certain options to
purchase shares of Cadence Common Stock pursuant to his employment agreement.
The employment agreements further provide that, upon termination of the
Employee's employment with the Surviving Corporation at any time before the one
year anniversary of the consummation of the Merger, the Employee's compensation
will be determined solely in accordance with the applicable Quickturn retention
plan. Between such one year anniversary and the date that is 18 months
following the consummation of the Merger, termination of any Employee without
cause (as defined in the employment agreements), or voluntary termination by the
Employee as a result of a reduction in base pay, reduction in title or a
material change in such Employee's job responsibilities, or because of his
relocation to more than 35 miles from his work location immediately prior to the
Merger, entitles such Employee to a cash payment equal to the Employee's base
salary for the remainder of the Employment Period. Upon termination at any time
during the Employment Period, the Cadence stock options granted to the
terminated Employee during the Employment Period will cease to vest and all
other employee medical, dental and other benefits will terminate, except as
otherwise required under the applicable Quickturn retention plan.
Each Employee has also agreed not to compete with the surviving corporation
before the later of (i) the eighteen month anniversary of the consummation of
the Merger and (ii) such Employee's termination of employment with the surviving
corporation. In addition, until one
<PAGE>
year after termination of his employment, the Employee may solicit neither
Cadence's nor the surviving corporation's employees nor their clients or
customers, nor may such Employee: (x) use any Cadence or Quickturn trade
secret or proprietary information, (y) interfere or attempt to interfere with
the surviving corporation's or Cadence's relationship with its customers or
clients, or (z) solicit the business of any client or customer of Cadence or
the surviving corporation.
Cadence has filed a registration statement on Form S-4 and related exhibits
with the SEC under the Securities Act of 1933, as amended (the "Securities
Act"). This registration statement on From S-4 also includes a proxy statement
of Quickturn regarding a special meeting of the Quickturn stockholders to
approve the Merger with Cadence. The registration statement contains additional
information about Cadence and the Merger. The registration statement and its
exhibits may be inspected without charge at the office of the SEC at 450 Fifth
Street, N.W., Washington, D.C. 20549, and copies may be obtained from the SEC at
prescribed rates. In addition, Cadence files annual, quarterly and special
reports, proxy statements and other information with the SEC. Any document
Cadence files with the SEC may be read and copied at the SEC's public reference
rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please
call the SEC at 1-800-SEC-0330 (1-800-732-0330) for further information on the
public reference rooms. Copies of these materials may also be obtained from the
public reference section of the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. The SEC also maintains a web site that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the SEC (http://www.sec.gov). Reports
and other information filed with the SEC by Cadence may be copied at the office
of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005.
VOTE REQUIRED
As described in the Quickturn Proxy Statement, each stockholder is entitled
to one vote for each share of Quickturn Common Stock held. Stockholders do not
have the right to cumulate votes in the election of directors. In connection
with the Removal Proposal (as defined in the Quickturn Proxy Statement),
pursuant to Section 141(k) of the Delaware General Corporation Law (the "DGCL")
and Section 3.16 of the Quickturn Bylaws, the removal of directors requires the
affirmative vote of a majority of all shares of Quickturn Common Stock
outstanding and entitled to vote on the election of directors. Accordingly,
abstentions and broker non-votes will have the same effect as votes cast against
the Removal Proposal. In connection with the Election Proposal (as defined in
the Quickturn Proxy Statement), pursuant to Section 216 of the DGCL, directors
will be elected by a plurality of the votes cast by stockholders at the Special
Meeting. Since votes are cast in favor of or withheld from each nominee,
abstentions and broker non-votes will have no effect on the outcome of the
Election Proposal. The Bylaw Amendment Proposal and the Bylaw Repeal Proposal
(each as defined in the Quickturn Proxy Statement and collectively, the "Bylaw
Proposals") each require the affirmative vote of a majority of the shares of
Quickturn Common Stock present in person or represented by proxy and entitled to
vote at the Special Meeting. Accordingly, assuming a quorum is present at the
Special Meeting, abstentions have the same effect as votes cast against the
Bylaw Proposals, while broker non-votes are not included in the total number of
votes cast on a Bylaw Proposal and therefore will not be counted for determining
whether the Bylaw Proposal has been approved.
<PAGE>
SECURITY OWNERSHIP
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of September 1, 1998 (unless otherwise
indicated), to the knowledge of Cadence and based on a review of publicly
available information, (i) each person or entity who is known by Cadence to own
beneficially more than 5% of the outstanding shares of Quickturn Common Stock;
(ii) each of Quickturn's current directors; (iii) each of the named Executive
Officers (as defined in Item 402(a)(3) of Regulation S-K of the Exchange Act);
and (iv) all directors and executive officers of Quickturn as a group.
<TABLE>
<CAPTION>
PERCENTAGE
SHARES BENEFICIALLY BENEFICIALLY
Name and Address of Beneficial Owner OWNED (1) OWNED
- - ------------------------------------ --------- -----
PRINCIPAL STOCKHOLDERS
<S> <C> <C>
Kopp Investment Advisors, Inc.(2)
7701 France Avenue South, Suite 500 2,597,975 14.4%
Edina, MN 55435..................................................
State of Wisconsin Investment Board(2)
P.O. Box 7842
Madison, WI 53707................................................ 2,101,500 11.6%
DIRECTORS
Glen M. Antle(3).................................................. 325,782 1.8%
Keith R. Lobo(4).................................................. 438,750 2.4%
Richard C. Alberding(5).......................................... 17,500 *
Michael R. D'Amour(6)............................................ 40,970 *
Dr. Yen-Son (Paul) Huang(7)....................................... 354,550 2.0%
Dr. David K. Lam(5)............................................... 10,417 *
William A. Hasler(8).............................................. 3,667 *
Charles D. Kissner(5)............................................. 1,667 *
NAMED EXECUTIVE OFFICERS (9)
Jeffrey K. Jordan(10)............................................. 1,134 *
Raymond K. Ostby(11).............................................. 102,767 *
Dugald H. Stewart(12)............................................. 7,390 *
Tung-sun Tung(13)................................................. 34,655 *
ALL DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP
(16 persons) (14)................................................. 1,792,816 9.5%
</TABLE>
________________
* Less than 1%.
(1) The number and percentage of shares beneficially owned is determined under
rules of the SEC, and the information is not necessarily indicative of
beneficial ownership for any other purpose. Under such rules,
<PAGE>
beneficial ownership includes any shares as to which the individual has
sole or shared voting power or investment power and also any shares which
the individual has the right to acquire within sixty days of September 1,
1998 through the exercise of any stock option or other right. Unless
otherwise indicated in the footnotes, to Cadence's knowledge, each person
has sole voting and investment power (or shares such powers with his or her
spouse) with respect to the shares shown as beneficially owned.
(2) This information was obtained from filings made by such stockholder with
the SEC pursuant to Sections 13(d) or 13(g) of the Exchange Act.
(3) Includes 257,270 shares held by The Antle Family Trust, as to which Mr.
Antle shares voting and dispositive power, and 68,512 shares of Quickturn
Common Stock exercisable within sixty days of September 1, 1998.
(4) Includes options to purchase 433,750 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
(5) All such shares are subject to options exercisable within sixty days of
September 1, 1998.
(6) Includes 31,388 shares held by The D'Amour Family Trust, as to which Mr.
D'Amour shares voting and dispositive power, and 4,583 shares of Quickturn
Common Stock subject to options exercisable within sixty days of September
1, 1998.
(7) Includes 37,548 shares held by The Huang Living Trust, as to which Mr.
Huang shares voting and dispositive power, and 31,250 shares of Quickturn
Common Stock subject to options exercisable within sixty days of September
1, 1998.
(8) Includes options to purchase 1,667 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
(9) Keith R. Lobo is also President and Chief Executive Officer of Quickturn
and is listed above under the heading "Directors."
(10) Includes options to purchase 333 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
(11) Includes options to purchase 94,667 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
(12) Includes options to purchase 7,000 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
(13) Includes options to purchase 20,568 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
(14) Includes options to purchase 747,164 shares of Quickturn Common Stock
exercisable within sixty days of September 1, 1998.
SECURITY OWNERSHIP BY CADENCE
See "Certain Information About Cadence" for information regarding Cadence's
beneficial ownership of Quickturn Common Stock.
There have been no purchases and sales of Quickturn Common Stock by Cadence
within the last two years.
SOLICITATION EXPENSES
Cadence intends to communicate with Quickturn Stockholders by mail,
telephone, facsimile and other electronic means utilizing its officers,
employees and agents. No such persons shall receive compensation for making
such communications.
Cadence anticipates that a total of less than $50,000 will be spent in
communicating with Quickturn Stockholders. To date, Cadence has incurred no
expenses in communicating with Quickturn Stockholders. Actual expenditures may
vary materially from the estimate, however, as many of the expenditures cannot
be readily predicted. The entire expense of preparing, assembling, printing and
mailing this Proxy Statement and any other related materials and the
<PAGE>
cost of communicating with Quickturn Stockholders will be borne by Cadence.
Cadence does not intend to request reimbursement from Quickturn for these
expenses.
