<PAGE>
================================================================================
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[X] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
QUICKTURN DESIGN SYSTEMS, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(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)(4) 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:
-------------------------------------------------------------------------
Notes:
<PAGE>
[LOGO OF QUICKTURN APPEARS HERE]
October 2, 1998
Dear Fellow Stockholder:
Your Board of Directors is committed to growing Quickturn's businesses and
increasing the value of your investment. We can only be successful with your
continued support.
PARTICIPATE IN QUICKTURN'S BRIGHT FUTURE
DO NOT TENDER YOUR SHARES
DO NOT VOTE MENTOR'S GOLD PROXY CARD
Your Board of Directors strongly believes that Quickturn has a great future.
We see, as we believe Mentor Graphics does, the potential for dramatic growth
in our key technologies. Your Board determined that Mentor's offer is
inadequate, does not reflect the inherent value of the company, and is not in
the best interests of Quickturn or its stockholders. The Quickturn Board
strongly recommends that you not tender your shares to Mentor and urges that
you not return Mentor's gold proxy card. Your Board believes that Quickturn
will generate substantial returns for stockholders over the next two years and
thereafter.
BUT DON'T JUST TAKE OUR WORD FOR IT . . .
LET THE FACTS SPEAK FOR THEMSELVES
Today, Quickturn announced that it expects to exceed consensus analysts'
estimates for the third quarter of 1998. The revenue for the quarter ending
September 30, 1998 is expected to be approximately $25.5 million, compared to
the consensus analysts' estimates of $24.7 million. Excluding the legal and
advisory expenses of approximately $4.0 million related to Quickturn's defense
against Mentor's attempted hostile takeover, the company currently expects net
income for the third quarter to be approximately $600,000, or $0.03 per share,
compared to consensus analysts' estimates of a loss of $0.03 per share. Over
the last two quarters, customers in several countries delayed investment in
high-performance verification tools. More recently, we see that several key
customers have begun to reinvest in design and verification. In fact, as we
enter the fourth quarter, Quickturn has the strongest backlog we've seen this
year.
<PAGE>
READ WHAT THE EXPERTS ARE SAYING...
THE STATE OF WISCONSIN INVESTMENT BOARD (SWIB) -- one of Quickturn's largest
stockholders with approximately 2,101,500 shares -- stated that it "HAS
REJECTED THE CASH TENDER OFFER MADE BY MENTOR GRAPHICS." SWIB said that
MENTOR'S OFFER IS "INADEQUATE," and that "QUICKTURN'S STAND-ALONE RETURN
POTENTIAL OVER THE LONG-TERM SIGNIFICANTLY EXCEEDS THE PRICE BEING OFFERED BY
MENTOR GRAPHICS."
Jennifer Smith, an analyst specializing in electronic design automation
(EDA) at BancBoston Robertson Stephens, said in an August 25, 1998 research
report, "Despite the current slowdown in the EDA sector, due to weakness in
Asia and the semiconductor market in general, WE BELIEVE THAT QUICKTURN IS
WELL POSITIONED TO PARTICIPATE IN GREATER THAN MARKET GROWTH WHEN THE
SEMICONDUCTOR MARKET RETURNS TO HEALTH." In the report, Ms. Smith also said,
".....[W]E BELIEVE THAT THE PROPOSED BID FOR QUICKTURN ... MAY NOT BENEFIT BOTH
COMPANIES' SHAREHOLDERS as much as investments in new, emerging verification
solutions."*
DON'T BE MISLED BY MENTOR'S DESPERATE ATTEMPT
TO TAKE OVER QUICKTURN AND ITS FUTURE
Mentor is soliciting gold proxy cards from Quickturn stockholders in its
attempt to replace your company's Board with its slate of hand-picked
nominees. If Mentor's nominees are elected, their primary purpose will be to
facilitate Mentor's takeover of Quickturn at what your Board has determined is
an inadequate price. YOUR BOARD STRONGLY URGES YOU TO REJECT MENTOR'S
SOLICITATION AND TO THROW AWAY ANY GOLD PROXY CARD THAT YOU MAY RECEIVE.
YOUR BOARD BELIEVES THAT MENTOR UNDERSTANDS THE SCARCITY VALUE OF
QUICKTURN'S LEADERSHIP POSITION IN THE INDUSTRY AND ITS POWERFUL PATENT
PORTFOLIO. Mentor's numerous challenges to Quickturn's patents have failed --
the courts have rejected to date every one of Mentor's challenges. Your
Board's rejection of Mentor's offer affirms its continued confidence in
Quickturn's future and its determination that our stockholders should be given
every opportunity to participate fully in that future.
YOUR BOARD STRONGLY RECOMMENDS THAT QUICKTURN STOCKHOLDERS NOT TENDER THEIR
SHARES TO MENTOR'S OFFER AND NOT RETURN ANY MENTOR GOLD PROXY CARD THAT MAY
HAVE BEEN SENT TO YOU. THE QUICKTURN BOARD WILL CONTINUE TO ENSURE THAT YOUR
BEST INTERESTS -- NOT MENTOR'S -- ARE SERVED.
2
<PAGE>
PARTICIPATE IN QUICKTURN'S BRIGHT FUTURE
DON'T TENDER YOUR SHARES
DON'T VOTE MENTOR'S GOLD PROXY CARDS
If you have tendered, you can still withdraw your shares, if you act
promptly. If you hold your shares with a bank or broker, you merely need to
call your broker to withdraw your shares. If you hold your shares in
certificate form, please fill out the enclosed withdrawal form. If you have
any questions or require any assistance in withdrawing any shares you may have
tendered, please call Morrow & Co., Inc. toll-free at 1-800-662-5200.
On Behalf of the Board of Directors,
/s/ Keith R. Lobo
Keith R. Lobo
Chief Executive Officer and
President
- --------
* First Call, BancAmerica Robertson Stephens: Jennifer M. Smith, August 25,
1998. Permission to use these quotations was neither sought nor obtained.
3
<PAGE>
CERTAIN INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements, including statements
regarding future periods as well as statements regarding the company's
markets. Actual results could differ materially from those described in the
forward-looking statements as a result of factors including, but not limited
to, the following: (i) review by the company's independent auditors; (ii) the
company is uncertain whether the recent weakness experienced in the Asia-
Pacific and domestic markets will continue in the foreseeable future; (iii)
product transitions to Quickturn's new Mercury Design Verification System may
be disrupted due to slow market acceptance or due to disruptions in
manufacturing or component availability; (iv) many of the company's customers
order on an as-needed basis and often delay delivery of firm purchase orders;
(v) the decision of customers to purchase the company's products involves a
lengthy sales cycle which could result, among other things, in fluctuations of
operating results and inventory obsolescence if expected orders are delayed or
not received; (vi) the company expects increased competition, which could
result in lost sales or price erosion; (vii) the company's patents and other
proprietary rights may not ensure adequate protection against competition;
(viii) the company serves the electronics and semiconductor industries, which
are noted for rapidly changing needs, there can be no assurance that
Quickturn's product enhancements or new product introductions will keep pace
with or meet those rapidly changing needs or that new products offered by
others will not be superior to those offered by Quickturn; and (ix) there can
be no assurance that Quickturn can retain the services of key employees and
key suppliers upon which the company is dependent to provide product advances,
timely production and high levels of product quality and reliability.
4
<PAGE>
--------------------------------------------------
HOW TO WITHDRAW YOUR QUICKTURN SHARES YOU'VE
TENDERED TO MENTOR GRAPHICS
--------------------------------------------------
Step 1: Fill out the information requested in sections A and B below completely.
======
STEP 2: Have section C (Signature Guarantee) completed and signed by an Eligible
====== Institution, as described in that section below.
STEP 3: Mail this completed form in the enclosed envelope and/or send it by
====== facsimile to one of the numbers listed on the reverse side so that it
will be received by the Depositary no later than 12:00 Midnight, New
York City time, October 6, 1998.
NOTE:
IF YOU TENDERED DIFFERENT SHARES, REGISTERED IN DIFFERENT NAMES, under
separate Letters of Transmittal, please use a separate Notice of
Withdrawal for each such Letter Of Transmittal.
IF YOU DO NOT KNOW YOUR CERTIFICATE NUMBER(S), you may call Boston
Equiserve at 1-781-575-3400 and request your certificate numbers.
================================================================================
GENTLEMEN:
The undersigned hereby withdraws the shares of Common Stock (the
"Shares") of Quickturn Design Systems, Inc. described below representing all
Shares tendered by the undersigned:
- -------------------------------------------------------------------------------
A. DESCRIPTION OF SHARES WITHDRAWN:
- -------------------------------------------------------------------------------
1. Name(s) of tendering shareholder(s).........................
2. Name(s) of registered holder(s) if different................
3. Number of Shares Withdrawn..................................
4. Certificate Numbers.........................................
ONLY FILL IN SECTIONS 5 AND 6 IF APPLICABLE
- -------------------------------------------
5. IF APPLICABLE, DTC, account number..........................
6. Name of DTC account.........................................
- -------------------------------------------------------------------------------
B. SHAREHOLDER SIGN HERE.
- -------------------------------------------------------------------------------
Must be signed by all registered holders as names appear on stock
certificates or by all persons authorized to become registered holders by
certificates and documents previously transmitted or transmitted herewith.
Signatures of Owner(s)
............................ ..................................
(Print name) (Signature)
............................ ..................................
(Print name) (Signature)
Date ...................., 1998
If signature is by trustee, executor, administrator, guardian, attorney-in-
fact, officer or other person acting in a fiduciary or representative capacity,
please set forth full title in the space below.
Capacity ......................................................................
Street or Box Number ............... City ........ State ........ Zip .........
<PAGE>
- -------------------------------------------------------------------------------
C. SIGNATURE GUARANTEE.
- -------------------------------------------------------------------------------
Must be completed by a member of a national securities exchange or the
National Association of Securities Dealers, Inc. or a commercial bank or trust
company having an office or correspondent in the United States (required if
certificates have been delivered)
Authorized Signature .........................................
Name of Firm ...................... Date ..................... 1993
NOTICE OF WITHDRAWAL
of Shares of Common Stock of Quickturn Design Systems, Inc. Tendered Pursuant to
the Offer to Purchase Dated August 12, 1998 by Mentor Graphics Corporation
TO: IBJ SCHROEDER BANK & TRUST COMPANY
BY MAIL: BY HAND OR
OVERNIGHT COURIER:
IBJ Schroeder Bank & Trust Company IBJ Schroeder Bank & Trust Company
One State Street One State Street
P.O. Box 84 Securities Processing Department
Bowling Green Station Reorganization Department SC-1
New York, New York 10274-0084 New York, New York 10004
BY FACSIMILE
(212) 858-2611
CONFIRM FACSIMILE BY TELEPHONE:
(212) 858-2103
===============================================================================
SHAREHOLDERS WHO DESIRE ASSISTANCE:
SHAREHOLDERS WHO DESIRE ASSISTANCE IN WITHDRAWING SHARES TENDERED PURSUANT
TO THE MENTOR OFFER MAY CONTACT MORROW & CO., INC., WHICH IS ASSISTING
QUICKTURN DESIGN SYSTEMS, INC., AT THE TELEPHONE NUMBER SET FORTH BELOW:
MORROW & CO., INC.
TOLL FREE 1-800-662-5200
===============================================================================
<PAGE>
CONTACTS:
QUICKTURN DESIGN SYSTEMS, INC. ABERNATHY MACGREGOR FRANK
Raymond K. Ostby Pauline Yoshihashi
(408) 914-6000 (213) 630-6550
Matt Sherman
(212) 371-5999
FOR IMMEDIATE RELEASE
QUICKTURN MAILS LETTER TO STOCKHOLDERS
URGES STOCKHOLDERS NOT TO TENDER SHARES, NOT TO VOTE FOR MENTOR'S BOARD
NOMINEES
SAN JOSE, CALIF. (OCTOBER 2, 1998)--Quickturn Design Systems, Inc. (Nasdaq:
QKTN) announced today that it has mailed a letter to Quickturn stockholders
recommending that they not tender their shares to Mentor Graphics Corporation
(Nasdaq: MENT). In addition, the Quickturn Board strongly urges stockholders
not to support Mentor's attempt to replace the Quickturn Board with its slate
of hand-picked nominees. The complete text of the letter follows:
October 2, 1998
Dear Fellow Stockholder:
Your Board of Directors is committed to growing Quickturn's businesses and
increasing the value of your investment. We can only be successful with your
continued support.
PARTICIPATE IN QUICKTURN'S BRIGHT FUTURE
DO NOT TENDER YOUR SHARES
DO NOT VOTE MENTOR'S GOLD PROXY CARD
Your Board of Directors strongly believes that Quickturn has a great future.
We see, as we believe Mentor Graphics does, the potential for dramatic growth
in our key technologies. Your Board determined that Mentor's offer is
inadequate, does not reflect the inherent value of the company, and is not in
the best interests of Quickturn or its stockholders. The Quickturn Board
strongly recommends that you not tender your shares to Mentor and urges that
you not return Mentor's gold proxy card. Your Board believes that Quickturn
will generate substantial returns for stockholders over the next two years and
thereafter.
BUT DON'T JUST TAKE OUR WORD FOR IT . . .
LET THE FACTS SPEAK FOR THEMSELVES
Today, Quickturn announced that it expects to exceed consensus analysts'
estimates for the third quarter of 1998. The revenue for the quarter ending
September 30, 1998 is expected to be approximately $25.5 million, compared to
the consensus analysts' estimates of $24.7 million. Excluding the legal and
advisory expenses of approximately $4.0 million related to Quickturn's defense
against Mentor's attempted hostile takeover, the
<PAGE>
company currently expects net income for the third quarter to be approximately
$600,000, or $0.03 per share, compared to consensus analysts' estimates of a
loss of $0.03 per share. Over the last two quarters, customers in several
countries delayed investment in high-performance verification tools. More
recently, we see that several key customers have begun to reinvest in design
and verification. In fact, as we enter the fourth quarter, Quickturn has the
strongest backlog we've seen this year.
READ WHAT THE EXPERTS ARE SAYING...
THE STATE OF WISCONSIN INVESTMENT BOARD (SWIB) -- one of Quickturn's largest
stockholders with approximately 2,101,500 shares -- stated that it "HAS
REJECTED THE CASH TENDER OFFER MADE BY MENTOR GRAPHICS." SWIB said that
MENTOR'S OFFER IS "INADEQUATE," and that "QUICKTURN'S STAND-ALONE RETURN
POTENTIAL OVER THE LONG-TERM SIGNIFICANTLY EXCEEDS THE PRICE BEING OFFERED BY
MENTOR GRAPHICS."
Jennifer Smith, an analyst specializing in electronic design automation
(EDA) at BancBoston Robertson Stephens, said in an August 25, 1998 research
report, "Despite the current slowdown in the EDA sector, due to weakness in
Asia and the semiconductor market in general, WE BELIEVE THAT QUICKTURN IS
WELL POSITIONED TO PARTICIPATE IN GREATER THAN MARKET GROWTH WHEN THE
SEMICONDUCTOR MARKET RETURNS TO HEALTH." In the report, Ms. Smith also said,
".....[W]E BELIEVE THAT THE PROPOSED BID FOR QUICKTURN ... MAY NOT BENEFIT BOTH
COMPANIES' SHAREHOLDERS as much as investments in new, emerging verification
solutions."*
DON'T BE MISLED BY MENTOR'S DESPERATE ATTEMPT
TO TAKE OVER QUICKTURN AND ITS FUTURE
Mentor is soliciting gold proxy cards from Quickturn stockholders in its
attempt to replace your company's Board with its slate of hand-picked
nominees. If Mentor's nominees are elected, their primary purpose will be to
facilitate Mentor's takeover of Quickturn at what your Board has determined is
an inadequate price. YOUR BOARD STRONGLY URGES YOU TO REJECT MENTOR'S
SOLICITATION AND TO THROW AWAY ANY GOLD PROXY CARD THAT YOU MAY RECEIVE.
Your Board believes that Mentor understands the scarcity value of
Quickturn's leadership position in the industry and its powerful patent
portfolio. Mentor's numerous challenges to Quickturn's patents have failed --
the courts have rejected to date every one of Mentor's challenges. Your
Board's rejection of Mentor's offer affirms its continued confidence in
Quickturn's future and its determination that our stockholders should be given
every opportunity to participate fully in that future.
YOUR BOARD STRONGLY RECOMMENDS THAT QUICKTURN STOCKHOLDERS NOT TENDER THEIR
SHARES TO MENTOR'S OFFER AND NOT RETURN ANY MENTOR GOLD PROXY CARD THAT MAY
HAVE BEEN SENT TO YOU. THE QUICKTURN BOARD WILL CONTINUE TO ENSURE THAT YOUR
BEST INTERESTS -- NOT MENTOR'S -- ARE SERVED.
2
<PAGE>
PARTICIPATE IN QUICKTURN'S BRIGHT FUTURE
DON'T TENDER YOUR SHARES
DON'T VOTE MENTOR'S GOLD PROXY CARDS
If you have tendered, you can still withdraw your shares, if you act
promptly. If you hold your shares with a bank or broker, you merely need to
call your broker to withdraw your shares. If you hold your shares in
certificate form, please fill out the enclosed withdrawal form. If you have
any questions or require any assistance in withdrawing any shares you may have
tendered, please call Morrow & Co., Inc. toll-free at 1-800-662-5200.
On Behalf of the Board of Directors,
/s/ Keith R. Lobo
Keith R. Lobo
Chief Executive Officer and
President
- --------
* First Call, BancAmerica Robertson Stephens: Jennifer M. Smith, August 25,
1998. Permission to use these quotations was neither sought nor obtained.
Quickturn Design Systems, Inc. is the leading provider of verification
products and time-to-market engineering (TtME(TM)) services for the design of
complex ICs and electronic systems. The company's products are used worldwide
by developers of high-performance computing, multimedia, graphics and
communications systems. Quickturn is headquartered at 55 W. Trimble Road, San
Jose, CA 95131-1013; Telephone: 408/914-6000. For more information, visit the
Quickturn Web site at www.quickturn.com or send e-mail to [email protected].
3
<PAGE>
CERTAIN INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements, including statements
regarding future periods as well as statements regarding the company's
markets. Actual results could differ materially from those described in the
forward-looking statements as a result of factors including, but not limited
to, the following: (i) review by the company's independent auditors; (ii) the
company is uncertain whether the recent weakness experienced in the Asia-
Pacific and domestic markets will continue in the foreseeable future; (iii)
product transitions to Quickturn's new Mercury Design Verification System may
be disrupted due to slow market acceptance or due to disruptions in
manufacturing or component availability; (iv) many of the company's customers
order on an as-needed basis and often delay delivery of firm purchase orders;
(v) the decision of customers to purchase the company's products involves a
lengthy sales cycle which could result, among other things, in fluctuations of
operating results and inventory obsolescence if expected orders are delayed or
not received; (vi) the company expects increased competition, which could
result in lost sales or price erosion; (vii) the company's patents and other
proprietary rights may not ensure adequate protection against competition;
(viii) the company serves the electronics and semiconductor industries, which
are noted for rapidly changing needs, there can be no assurance that
Quickturn's product enhancements or new product introductions will keep pace
with or meet those rapidly changing needs or that new products offered by
others will not be superior to those offered by Quickturn; and (ix) there can
be no assurance that Quickturn can retain the services of key employees and
key suppliers upon which the company is dependent to provide product advances,
timely production and high levels of product quality and reliability.
4
