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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13G
Under the Securities Exchange Act of 1934
(Amendment No. 3)
Castelle
(Name of Issuer)
Common Stock, no par value
(Title of Class of Securities)
147905-10-3
(CUSIP Number)
December 31, 1998
(Date of Event Which Requires Filing of This Statement)
Check the appropriate box to designate the rule
pursuant to which this Schedule is filed:
[ ] Rule 13d-1(b)
[ ] Rule 13d-1(c)
[x} Rule 13d-1(d)
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 2 of 15
1 Name Of Reporting Person H&Q LONDON VENTURES
IRS Identification No. Of Above Person 94-2966540
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
England
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
PN
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 3 of 15
1 Name Of Reporting Person H&Q VENTURES IV
IRS Identification No. Of Above Person 94-2940347
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
California
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
PN
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 4 of 15
1 Name Of Reporting Person VENTURE ASSOCIATES (BVI) LIMITED
IRS Identification No. Of Above Person
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
Bermuda
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
PN
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 5 of 15
1 Name Of Reporting Person HAMQUIST
IRS Identification No. Of Above Person 94-2800484
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
California
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
PN
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 6 of 15
1 Name Of Reporting Person HAMBRECHT & QUIST VENTURES PARTNERS
IRS Identification No. Of Above Person 94-2949080
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
California
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
PN
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 7 of 15
1 Name Of Reporting Person H&Q VENTURE PARTNERS, LLC
IRS Identification No. Of Above Person
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
Delaware
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
00
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 8 of 15
1 Name Of Reporting Person HAMBRECHT & QUIST CALIFORNIA
IRS Identification No. Of Above Person 94-2856927
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
California
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
CO
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 9 of 15
1 Name Of Reporting Person HAMBRECHT & QUIST GROUP
IRS Identification No. Of Above Person 94-3246636
2 Check The Appropriate Box If A Member Of A Group (a) [ ]
(b) [x]
3 SEC USE ONLY
4 Citizenship Or Place Of Organization
Delaware
5 Sole Voting Power
-0-
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY EACH
REPORTING
PERSON WITH
6 Shared Voting Power
683,066
7 Sole Dispositive Power
-0-
8 Shared Dispositive Power
865,581
9 Aggregate Amount Beneficially Owned By Each Reporting Person
865,581
10 Check Box If The Aggregate Amount In Row (9) Excludes Certain
Shares*
11 Percent Of Class Represented By Amount In Row 9
20.0%
12 Type Of Reporting Person*
HC, CO
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 10 of 15
Item 1(a). Name of Issuer.
Castelle (the "Issuer").
Item 1(b). Address of Issuer's Principal Executive Offices.
3255-3 Scott Boulevard, Santa Clara, CA 95054.
Item 2(a). Names of Persons Filing.
Reference is made to Item 1 of each of the cover pages
of this Schedule, which Items are incorporated by reference
herein.
Item 2(b). Address of Principal Business Office or, if none,
Residence.
The address of each reporting person is One Bush
Street, San Francisco, California 94104.
Item 2(c). Citizenship.
Reference is made to Item 4 of each of the cover pages
of this Schedule, which Items are incorporated by reference
herein.
Item 2(d). Title of Class of Securities.
Common Stock, no par value ("Common Stock").
Item 2(e). CUSIP Number.
147905-10-3
Item 3. Type of Reporting Person.
Not applicable.
Item 4. Ownership.
Reference is made to Items 5-9 and 11 of each of the
cover pages to this Schedule, which Items are incorporated by
reference herein. According to the Issuer's most recent Form
10-Q, there were 4,332,448 shares of Common Stock issued and
outstanding as of November 13, 1998. As of December 31, 1998,
the reporting persons owned the following shares of Common Stock
and warrants to acquire shares of Common Stock that are
immediately exercisable or exercisable within 60 days of such
date:
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 11 of 15
Common Stock
Common Stock Upon Exercise
Person Directly Owned Of Warrants
H&Q London Ventures 338,480 16,666
H&Q Ventures IV 60,835 -0-
Venture Associates (BVI)
Limited -0- -0-
Hamquist 1,250 -0-
Hambrecht & Quist Venture
Partners 43,633 -0-
RVR Securities -0- -0-
Hambrecht & Quist California 85,536 136,666
TOTAL 529,734 153,332
======= =======
Because voting and investment decisions concerning the
above securities may be made by or in conjunction with Hambrecht
& Quist Venture Partners ("H&Q Venture Partners"), H&Q Venture
Partners, LLC, Hambrecht & Quist California ("H&Q California")
and Hambrecht & Quist Group ("H&Q Group"), each of the reporting
persons may be deemed a member of a group that shares voting and
dispositive power over all of the above securities. Although the
reporting persons are reporting such securities as if they were
members of a group, the filing of this Schedule shall not be
construed as an admission by any reporting person that it is a
beneficial owner of any securities other than those directly held
by such reporting person.
In addition, H&Q Group may be deemed to be the
beneficial owner of 182,515 shares of Common Stock held by Ivory
and Sime Enterprise Capital PLC (formerly known as The
Independent Investment Company PLC). Pursuant to existing
arrangements, H&Q Group does not have voting power over such
shares, but may be considered to have investment power. Although
such shares are included in the number of shares beneficially
owned by the reporting persons for purposes of this Schedule, the
reporting persons disclaim beneficial ownership of such shares
for any purpose.
Under the definition of "beneficial ownership" in Rule
13d-3 under the Securities Exchange Act of 1934, it is also
possible that the individual general partners, directors,
executive officers, members and/or managers of the foregoing
entities might be deemed the "beneficial owners" of some or all
of the securities to which this Schedule relates in that they
might be deemed to share the power to direct the voting or
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 12 of 15
disposition of such securities. Neither the filing of this
Schedule nor any of its contents shall be deemed to constitute an
admission that any of such individuals is, for any purpose, the
beneficial owner of any of the securities to which this Schedule
relates, and such beneficial ownership is expressly disclaimed.
William R. Hambrecht previously reported his beneficial
ownership of Issuer securities as a member of a group that
included the foregoing reporting persons. However, Mr. Hambrecht
is no longer a member of such group. Mr. Hambrecht was
previously affiliated with the foregoing reporting persons,
including as a director and officer of H&Q Group and H&Q
California, and as one of the two general partners of H&Q Venture
Partners. Mr. Hambrecht resigned his positions from H&Q Group
and H&Q California as of January 1, 1998, and he withdrew as a
general partner of H&Q Venture Partners as of April 3, 1998.
Accordingly, Mr. Hambrecht is not now a beneficial owner of the
securities reported in this Schedule 13G, and the reporting
persons are not now beneficial owners of the securities owned by
Mr. Hambrecht.
This Schedule does not include shares of Common Stock,
if any, held by Hambrecht & Quist LLC in its trading account if
it is a market maker in the Issuer's Common Stock.
Item 5. Ownership of Five Percent or Less of a Class.
Not applicable.
Item 6. Ownership of More Than Five Percent on Behalf of
Another Person.
Not applicable.
Item 7. Identification and Classification of the Subsidiary
Which Acquired the Security Being Reported on by the
Parent Holding Company.
Not applicable.
Item 8. Identification and Classification of Members of the
Group.
Not applicable.
Item 9. Notice of Dissolution of Group.
Not applicable.
Item 10. Certification.
Not applicable.
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 13 of 15
Signature
After reasonable inquiry and to the best of their
knowledge and belief, the undersigned certify that the
information set forth in this statement is true, complete and
correct.
DATED: February 10, 1999.
H&Q LONDON VENTURES H&Q VENTURE PARTNERS, LLC
By: /s/ Jackie A. Berterretche By: /s/ William D. Easterbrook
___________________________ ___________________________
Jackie A. Berterretche William D. Easterbrook
Attorney-in-Fact Member-Manager
H&Q VENTURES IV HAMBRECHT & QUIST CALIFORNIA
By: /s/ Jackie A. Berterretche By: /s/ Steven N. Machtinger
___________________________ ___________________________
Jackie A. Berterretche Steven N. Machtinger
Attorney-in-Fact General Counsel & Secretary
VENTURE ASSOCIATES (BVI) HAMBRECHT & QUIST GROUP
LIMITED
By: /s/ Steven N. Machtinger
By: /s/ Jackie A. Berterretche ___________________________
___________________________ Steven N. Machtinger
Jackie a. Berterretche General Counsel & Secretary
Attorney-in-Fact
HAMQUIST
By: /s/ Jackie A. Berterretche
___________________________
Jackie A. Berterretche
Attorney-in-Fact
HAMBRECHT & QUIST VENTURE
PARTNERS
By: _______________________
Jackie A. Berterretche
Attorney-in-Fact
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 14 of 1
EXHIBIT INDEX
Exhibit A Joint Filing Undertaking Page 15
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CUSIP No. 147905-10-3 SCHEDULE 13G Page 15 of 15
JOINT FILING UNDERTAKING
The undersigned, being duly authorized thereunto,
hereby execute this agreement as an exhibit to this Schedule 13G
to evidence the agreement of the below-named parties, in
accordance with rules promulgated pursuant to the Securities
Exchange Act of 1934, to file this Schedule and any subsequent
amendment jointly on behalf of each of such parties.
DATED: February 10, 1999.
H&Q LONDON VENTURES H&Q VENTURE PARTNERS, LLC
By: /s/ Jackie A. Berterretche By: /s/ William D. Easterbrook
___________________________ ___________________________
Jackie A. Berterretche William D. Easterbrook
Attorney-in-Fact Member-Manager
H&Q VENTURES IV HAMBRECHT & QUIST CALIFORNIA
By: /s/ Jackie A. Berterretche By: /s/ Steven N. Machtinger
___________________________ ___________________________
Jackie A. Berterretche Steven N. Machtinger
Attorney-in-Fact General Counsel & Secretary
VENTURE ASSOCIATES (BVI) HAMBRECHT & QUIST GROUP
LIMITED
By: /s/ Steven N. Machtinger
By: /s/ Jackie A. Berterretche ___________________________
___________________________ Steven N. Machtinger
Jackie a. Berterretche General Counsel & Secretary
Attorney-in-Fact
HAMQUIST
By: /s/ Jackie A. Berterretche
___________________________
Jackie A. Berterretche
Attorney-in-Fact
HAMBRECHT & QUIST VENTURE
PARTNERS
By: _______________________
Jackie A. Berterretche
Attorney-in-Fact
