Filed by Synopsys, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Avant! Corporation
Commission File No. 0-25864
The following is a transcript of a conference call hosted jointly by
Synopsys, Inc. and Avant! Corporation on December 3, 2001.
Synopsys Conference Call, 12.3.01
Operator: Ladies and Gentlemen, thank you for standing by, and welcome to
this special conference call. At this time all participants are in a
listen-only mode. Later we will conduct a question-and-answer session.
Instructions will be given at that time. If you should require
assistance during the call, please press "0," followed by "star." As a
reminder, today's conference is being recorded.
During the course of this conference call, Synopsys and Avant!
(pronounced Ah-VAHN-tee) Corporation may make forward-looking
statements regarding the performance of the companies before the
proposed merger and the combined company after the proposed merger,
and, in Synopsys's case, regarding the future financial result. While
these statements represent each company's best current judgement about
its future performance, each company's actual performance is subject
to significant uncertainties that could cause actual results to differ
materially from those that may be projected, including the risk
described in the two press releases issued earlier today describing
the proposed merger and Syopsys' fourth quarter and Fiscal Year 2001
results. In addition to any other risk factors that may be highlighted
during this conference call, listeners should also review each
company's most recent 10-K, 10-Q, and 8-K reports on file with the
Securities and Exchange Commission, as well as the [collection]
materials that will be filed regarding the proposed merger for
important factors that could cause actual results to differ materially
from those that may be projected.
At this time I would like to turn the conference over to the Chairman
and Chief Executive Officer of Synopsys, Dr. Aart de Geus. Please go
ahead, Sir.
Aart
de Geus: Good afternoon. I have with me Paul Lo, President of Avant!,
Chi-Foon Chan, President and COO of Synopsys, and Brad Henske, our
CFO. We have moved our earnings conference up because we have some
great news to announce. Synopsys has signed a definitive agreement to
acquire Avant! Corporation. This is exciting news for many reasons.
First, for our customers, the merger instantly brings together the
best front-end and the best back-end design tools under a single roof.
Many top executives from the largest semiconductor and system
companies have personally suggested to me that they would welcome such
a move.
Second, both Avant! and Synopsys employees see the power of this
combination. Our employees have a tradition of strong technology
innovation, delivery, and support. Combining expertise in our
complementary areas opens the door to providing a complete IC design
solution that is unmatched in the industry.
Third, our shareholders have viewed it as a very strong move. At a
time when customers are reducing their number of suppliers, Synopsys
emerges as a provider of the strongest technical solution in the
industry. In addition, both Synopsys and Avant! have a solid track
record of sound financial execution and growth.
The bottom line is that this merger is a bold move that instantly puts
up in the leadership position for IC design automation.
What everyone knows, is that Avant! has had significant legal
troubles. I want to move forward here. Some bad things occurred, some
people were caught, they pleaded no contest, some individuals received
sentences and Avant! paid the price. A huge price. Not only did they
make a very large restitution payment upon closure of the criminal
case, but they also suffered for years under a cloud of doubt and
distrust. This is especially unfortunate in light of the outstanding
new technology that their engineers have produced over the years. But
let me be very clear, we have not condoned what happened in the past.
We have done our homework and we are convinced that what we are
acquiring today is clean. In addition, we will put forth our best
effort to practically seek a reasonable and fair settlement with
Cadence on any outstanding issues effective on the closing of the
merger. Cadence and Synopsys leadership in resolving these issues will
open a new chapter to a more mature and healthier EDA industry going
forward.
This is an important time to strengthen our industry, especially in
light of the economic situation around us. In the last three months
the outlook for semiconductors and electronics in general have become
significantly bleaker as hopes for an earlier recovery have been
replaced with an almost complete lack of visibility.
Our customers have forced to take action. After initially cutting the
obvious things, they are now re-examining even their key projects and,
if necessary, cutting into what was previously considered untouchable.
Even R&D budgets are no longer immune and EDA expenses are
increasingly scrutinized and/or delayed. I hasten to say however that
compared to our customers our EDA industry has so far performed
remarkably well and will continue to do so. For Synopsys, we completed
a solid quarter and met expectations. Nonetheless, good management
discipline clearly prescribes that we forecast more conservatively,
that we manage expenses aggressively, and that we correct up or down
as visibility returns. We will manage the business in fiscal '02 to
yield earnings of at least $2.00 a share. Brad will give detail about
that in a moment.
No matter what the economic situation looks like, though, Synopsys as
a company is very strong. We expect to gain market share through
growth of the combined company as our customers reduce the number of
their suppliers, and we will make bold moves to maximize the
situation. From that perspective, the acquisition of Avant!
compliments our existing position in a remarkable way.
To explain this better let me paint a picture that describes the
post-merger Synopsys. It is helpful to think of the IC design process
as having three main functions: design creation, functional
verification, and design integrity.
Let me start with design creation. This is the process that implements
a high-level chip description written in a language such as Verilog,
VHDL, or C into a detailed layout. Traditionally this was done in two
main steps. First: Synthesis; and second, Place-and-Route.
Synopsys is clearly the technical and market leader in synthesis.
Avant! is the strongest place-and-route solution where it competes
most directly with Cadence, among others.
In the last two years, driven by small geometries, a new discipline
has emerged at the intersection between the two steps. This new
discipline is aptly named physical synthesis. Synopsys far and away
leads in this emerging area with over 75 percent bookings growth in
fiscal '01 over last year, ending the year with 103 million in orders,
well over 350 tapeouts, and over 150 customers. This does not include
approximately 11 million in orders from customers who bought our
design compiler product and then upgraded to physical compiler within
the year. Those numbers will bring the tally to 114 million for
Physical Synthesis.
It was also rewarding to see that orders in aggregate for the design
compiler family grew approximately 50 million this year as customers
currently find that a mix of design compiler and physical compiler
meets their need.
The quality of our customer base in this area is impressive. For
example, just last quarter we announced a variety of physical
synthesis endorsements from IBM, TSMC, NEC, and Scientific Atlanta. I
have no doubt whatsoever that the combination of Synopsys synthesis
and physical synthesis with Avant!'s place and route, and database, is
the best-in-class design flow today. More than that, it is also the
basis for delivering leading solutions for .13 and .10 micron in a
very short time frame.
The second area is functional verification. The objective in this area
is simply stated as: "Does my design perform the function that I
intended?" meaning for example, "Does my multiplier actually
multiply?" Since the early days of EDA, this area has been anchored by
simulation. With VCS, our Verilog simulator, Synopsys has a star
product. Around VCS we have half a dozen connected products ranging
from models to testbench languages to formal verification techniques.
Avant! adds a crucial piece to this picture: a leading circuit
simulator. This addition significantly strengthens our competitive
position in mixed-signal verification, which is needed for chips in
the wireless, automotive, and consumer domains.
The third area is "design integrity," where you make sure that the
chip will actually work. Here you check for errors ranging from signal
integrity to timing to manufacturing defects. Synopsys has an
extremely strong position in this area. Our design-for-test solution
is very well integrated into the design flow and PrimeTime is the de
facto standard timing verifier in the industry. In addition, we have
recently grown these capabilities with leading-edge signal integrity
analysis.
The Avant! acquisition fills a major hole for us in the design
integrity arena: a complete physical verification, extraction, and
mask synthesis solution. These terms may not mean much to the
uninitiated, but they allow customers to verify that the chip can
truly be fabricated and will work at the correct speed.
Furthermore, in all the areas, design creation, functional
verification, and design integrity, the highly regarded Milky Way
database from Avant! will be a key asset in connecting all these
pieces together smoothly.
The bottom line of this is powerful. In all three areas, but
especially in design creation and design integrity, Synopsys and
Avant! are an almost perfect complementary match. Our customers have
long known this and have done their best to glue our products together
in their own flows. But coming together into one company now will
provide a solution that fulfills the requirements of the most
demanding designers.
At this point I would be remiss not to mention two other highlights
from the past quarter. It's no secret that most consulting businesses
are feeling the brunt of the economic downturn, ours included.
However, we continue to invest in this business, anticipating that the
combination of tools, services, and state-of-the-art system-on-chip
requirements will bring good business opportunities.
Confirming that investment, we recently announced a very significant
relationship with Intel, who is entering the ASIC business with our
support. Together with Intel, we are offering a complete concept-to-
manufactured-parts solutions to mutual customers. Two large contracts
with US systems companies have already been closed.
The second area that I would like to highlight is our intellectual
property business. We have always believed that the reuse of IP is a
key influencer of methodology and tools, and vice versa. As you know,
we have a substantial DesignWare business, which up until now has
consisted mainly of basic IP business blocks. Last quarter we
announced agreements with ARM, MIPS, NEC, Infineon and Gain to
distribute much of their higher level IP through our DesignWare
channel
To conclude this portion of the call I would like to reiterate my
enthusiasm about the merger. And with that I would like to now turn
the call over to Paul Lo, president of Avant!, who is here with us
today as well.
Paul?
Paul: Thank you Aart. Good afternoon everyone. This is Paul, president of
Avant!. Today for the first time I'm joining Synopsys in their
conference call to talk about Synopsys's purchase of Avant!.
This merger opens a new chapter in the history of the EDA industry.
Two acknowledged industry leaders are now joining forces to form what
we believe will soon be the pre-eminent supplier in the EDA business.
I'm happy and proud to be a part of it and I have high hopes for the
future.
Although Synopsys and Avant! have built their businesses independently
over the past several years, we have some of the same basic values.
Both Synopsys and Avant! have always focused on technology
development, and have pride in the technologists who created it.
I know what it takes to create the most competitive chip design
systems in the world. I have also observed Synopsys technology and
product development over the years as well. I have great respect for
Synopsys and I have come to know Synopsys as a company that knows what
the customer wants and is persistent in delivering it. I think that
Synopsys and Avant! are soul mates when it comes to technology
development.
I believe that this merger creates great value for the customers.
Semiconductor manufacturing technology has continued to advance and
customers have come to depend on both Synopsys and Avant! to deliver
ever more advanced chip design solutions. Products from both Synopsys
and Avant! are now used in the world's most advanced chip design flow.
For years our customers have asked us to work more closely with
Synopsys and now their wish has come true. In this combination our
customers will get the best technology available today along with the
best engine of innovation in the business.
I want to take a moment to reflect on the accomplishments of Avant! as
an independent company. Avant! began in 1991 as a supplier of standard
sale systems. Even today customers recognize Avant! as the leader in
this large and growing product category, but we have become much more
since our humble beginning. We initiated and nurtured a company
culture based on customers, technology, and people. Avant! had grown
to offer over 45 different products including the powerful single path
SOC design flow and Milky Way database which offers customers the most
productive chip design process in the world.
Avant! has also had its big challenges, but thanks to the fighting
spirit of hundreds of Avant! employees we not only survived, but
flourished. I think that the last six years of Avant!'s history
illustrates the tough character and supreme determination of Avant!.
I'm convinced that this will not be lost as we join forces with
Synopsys.
I have personally visited over 30 customers in the recent month. In
all these visits not a single customer has told me that they are
abandoning us. Instead they have high hopes for new products that we
recently introduced. Over 90 percent of our top customers are actually
engaged in the evaluation of one or more of our new products. We have
strong tradition of loyalty to our R&D engineers. As a result, our
turnover rate among this group has been very low. We bet that our team
of technologists will be happy and proud to join Synopsys because of
their passion for great technology.
Overall I think that this combination creates a great new team, a team
that I know I will be proud of. In my opinion this merger teams the
best with the best. It is great for customers and great for the
industry overall. I think that the merger will create the very best
company in the EDA business.
Thank you. Now I turn the call to Brad.
Brad
Henske: Thanks Paul. Aart and Paul have described some of the benefits
of the transaction and the terrific fit between the two companies. Let
me briefly talk about some of the details of the transaction and then
I'll review our quarter and guidance.
The deal itself is pretty vanilla. It's a straight stock for stock
deal in which each Avant! share will be exchanged for .371 shares of
Synopsys stocks at closing. There are no caps or collars. At today's
closing price for Synopsys of $55.39, the aggregate consideration,
based on Avant!'s fully diluted shares is approximately 830 million
dollars. We expect to effect a tax-free reorganization. Outstanding
Avant! options will be converted into Synopsys options at closing,
based on the exchange ratio.
From an operational point of view, Avant! will be integrated into
Synopsys after closing. No Avant! board members will join the Synopsys
board, and Gerry Hsu will resign all positions with the company
effective on the closing date. We expect the fees and expenses at
closing will be approximately 420 million dollars, including $335
million for insurance--which I will talk about in a minute--$55
million to pay pre-existing employment agreements, and 30 million
dollars in investment banking, brokerage and other fees and expenses.
We expect additional severance and facility consolidation expenses in
the first operating quarter.
In connection with the merger agreement, by December 31st Avant!'s
Japanese distributor, Maingate, will become a wholly owned subsidiary
of Avant! with no remaining individual shareholders at approximately
no net cost to Avant!. Avant!'s other principal distributor agreements
have been modified to remove the distributor's right to receive large
lump sum payments upon a change of control. Avant! will file an 8-K
with the SEC which will provide the details regarding these
transactions.
As I mentioned, we have obtained a binder of insurance, effective
after the closing, with a triple A rated insurer to pay all damages,
penalties, and costs arising out of the litigation with Cadence. The
total premium will be 335 million dollars. The policy coverage limit
is 500 million dollars plus accrued interest on the first 250 million
dollars of the premium. In the event that amounts paid out on the
policy are less than 250 million plus accrued interest, Synopsys will
be entitled to a refund of the difference. While we cannot guarantee
the outcome of the case, based on our assessment of the probabilities
which was developed with the assistance of two outside law firms, we
believe that we have more than adequately provided for the liability.
For financial reporting purposes, 250 million dollars of the premium
will be held on the Synopsys balance sheet as a long term restricted
asset and the interest from that amount will be included in other
income. The remaining 85 million dollars will be expensed when the
policy takes effect. The transaction is subject to approval by both
company shareholders, regulatory approval, and other customary closing
conditions. While always hard to predict, we expect the deal will
close within three to six months.
Let me now give you the details on what was, given the environment, a
successful fourth quarter for fiscal 2001, followed by some commentary
on our outlook going forward and the impact of the proposed merger.
For Q4 our revenue came in at the middle of our guidance range. We
outperformed on expenses, and earnings before goodwill per share was
39 cents, at the top of our target range. We also built considerable
backlog, deferred revenue, and cash. Q4 was the highest orders quarter
in Synopsys history. Orders in aggregate grew approximately 14 percent
in fiscal 2001 over fiscal 2000. Q4 product orders divided between
approximately 86 percent Technology Subscription Licenses or TSLs,
and 14 percent perpetuals, which we believe is an abnormally low level
and was driven by the large number of aggregate orders in the quarter.
The average duration of TSLs in Q4 continued to be between three and
half and four years.
Orders linearity for Q4 was consistent with the prior quarter, and,
while not as good as we would have liked, was still better than that
experience prior to our license change. Q4 revenue was 183.6 million
dollars, which represents 38 percent growth from the same quarter a
year ago and is in the middle of our guidance range. Product revenue,
which is primarily comprised of our perpetual licenses, was 47 million
dollars. Ratable license revenue was 55 million dollars this quarter.
TSL revenue continues to grow as our backlog flywheel continues to
build. Services revenue totaled 82 million dollars this quarter, down
six percent from the same period a year ago and flat when compared to
last quarter. We continue to see the migration of the old TBL
maintenance into the TSL revenue screen.
Overall gross margin was 81 percent of revenue, flat when compared to
the prior quarter. Product gross margin was 91 percent for Q4-01
compared to 85 percent for the prior quarter. Ratable license gross
margins equaled 82 percent for Q4 as compared to 87 percent for Q3.
We have started this quarter to allocate product cost-of-goods based
on product order mix rather than product revenue mix as we had in
prior quarters. This will be effective for all of fiscal 2001. The
aggregate cost-of-goods is unchanged. The change in margins from Q3 to
Q4 was driven by the large increase in TSL orders in proportion to
revenue in our seasonally strongest quarter of the year. Service gross
margins came in at 76 percent, flat as compared to the prior quarter.
Our aggregate EBG operating expenses, including cost-of-goods, were
166 million dollars, at the bottom of our guidance range. Operating
earnings were 17.6 million, up 198 percent sequentially. Other income
was 17 million, and investment gains were 13.5 million, in line with
expectations. Earnings before goodwill amounted to 39 cents per share,
at the upper end of our guidance based on lower expenses. Diluted
share count was 62 and a half million, slightly below expectations, as
our stock price was somewhat lower throughout the quarter than we
expected.
Synopsys's balance sheet is strengthening. Cash and short-term
investments grew substantially, with our Q4 balance ending at 476
million dollars, up 167 million dollars from the prior quarter. Q4
cash per diluted share amounted to seven dollars and 63 cents. Q4
accounts receivable totaled 146 million dollars. For the quarter, DSO
was 73 days, up from 68 days in Q3. During the quarter we factored no
receivables. Deferred revenue at the end of the quarter was 380
million dollars, up 129 million dollars or 51 percent from the prior
quarter.
During the quarter we repurchased no shares under our stock buyback
program. As a result of our discussions with Avant!, we closed the
trading window for both the buyback and company management. We'll
resume stock purchases in this quarter to the extent that we find
market conditions attractive, while at the same time planning for
funding the payments at closing of the Avant! acquisition. Head count
totaled 3,308 employees for the quarter, up 106 from the prior
quarter.
Now I'd like to spend a minute discussing the current economic
environment and the impact it's having on our business. As Aart
mentioned, we completed our quarter against the backdrop of a steadily
deteriorating economic environment. The semiconductor industry
continues to be mired in a downturn that if measured by peak-to-trough
of shipments is almost twice as bad as any downturn in the last 15
years. As revenue has fallen semiconductor R&D spending as a
percentage of revenue has increased. It has now reached levels not
seen in recent history. Perhaps most striking, very few of our
customers will say they have much visibility into the next few
quarters. As a result, in the last quarter customers hit the brakes,
hard. Therefore both visibility and predictability of business has
abruptly gotten a lot poorer for us, and we believe in reality for the
rest of the EDA industry.
For us, on the positive side, we have continued to book significant
contracts with both large and small customers, including in this
quarter the largest single contract in Synopsys history. Our
transition to a ratable model has been largely successful, and we end
our fiscal year 2002 with 432 million dollars in deferred revenue and
backlog that will turn into revenue this year.
We're seeing customers starting to pare down their list of suppliers
and we are clearly on the A list.
But not even players on the A list are going to get through this
recession unscathed. During the quarter we saw a number of trends in
the business relating to the recession that caused us to take a more
cautious outlook going forward.
First, our consulting and training business continues to struggle,
reflecting the environment. Orders, although strong in Q3, were
relatively weak in Q4, causing us to move our expectations for the
consulting business's revenue down by more than 24 million dollars in
fiscal 2002. During Q4 the average duration of TSLs was longer than we
expected. On the positive side, the customers are willing to commit to
our technology for longer terms. It also builds long term backlog,
which is now ahead where we assumed it would be. For the short term,
however, the TSLs booked in Q4 will deliver less revenue in the next
12 months than we originally expected. As the realities of the market
became more apparent, we began to focus on a more conservative plan,
to tighten our own spending, to curtail hiring and other expenses,
thus bringing our operating expenses in at the bottom of our range.
Let me come now to future guidance. In light of the changes in the
economic environment and with the potential impact of the merger with
Avant!, we do not believe that we have enough visibility to
confidently give complete guidance for 2002.
However, for the first fiscal quarter of 2002 we expect revenue of 174
to 178 million, total expenses of 162 to 166 million, other income and
expense of ten to 11 million including approximately seven million
dollars of investment gains, outstanding shares of 63 to 65 million,
and earnings before goodwill of 24 to 28 cents per share.
We expect revenue to consist of approximately 20 percent perpetuals,
40 percent ratable revenue, and 40 percent services. Total revenue
will be down sequentially from Q4 as we expect approximately 11
million dollars less product revenue from perpetuals in Q1 than in Q4.
At this stage in our transition of ratable revenue, orders for
perpetuals still have a disproportionate impact on total revenue, and
Q1 is historically our lowest bookings quarter. In addition, we expect
other I & E to be down by approximately seven million dollars based on
the planned lower gain on sales and investments. The impact of these
changes, offset by lower expenses, will produce the sequentially lower
earnings.
On the positive side, however, our forecast for Q1 is slightly higher
than the forecast that we held three months ago at the end of Q3 2001.
Without sufficient visibility for the full year at this stage, we are
modifying our full year 2002 guidance that we gave at the end of Q3 in
a number of significant respects. In light of the current environment,
we have decided to manage our business to deliver specific earnings
for the year, namely, at least two dollars per share on an EBG basis.
Revenue will be lower than the guidance we provided at the end of Q3,
but at this time we are not providing updated revenue guidance for the
year and are withdrawing our previous guidance. We are acting
immediately to reduce our expected expenses in 2002 by 30 million
dollars versus the guidance given before, and will reduce expenses
further if necessary to meet our earnings target. While it's possible
for one to infer a revenue number from the guidance we've provided,
any such calculations should not be construed as guidance from us.
We'll reconsider this decision at the end of each quarter and should
conditions change sufficiently we will issue revenue guidance. We
expect other I & E, the tax rate and outstanding shares to be
consistent with prior guidance. Although we appreciate that our
guidance is lower and less certain than the guidance we issued three
month ago, we feel it reflects reality in the EDA markets today. For
the year, we expect orders to grow modestly, on the rough order of ten
percent depending on changes in the economy, and assuming a three year
average TSL duration. We expect perpetuals to be 15 to 25 percent of
orders in any given quarter. We are broadening the range a bit from
last quarter's guidance in view of the volatility of the market.
None of the foregoing discussion reflects the proposed acquisition of
Avant!. Highly dependent on the timing of the closing, we expect that
the acquisition will be modestly dilutive in fiscal 2001, on the rough
order of 30 cents. This is primarily driven by the conversion of their
business to our license mix and the accounting difficulty in
recognizing in the future the deferred revenue and backlog that Avant!
will have closing. But for these effects we expect the acquisition of
Avant! would be significantly accretive in the short term.
As we have previously announced Avant! today books approximately 50
percent of its orders as perpetual licenses and 50 percent as
subscriptions. We expect that the customer dynamics of an integrated
company will rapidly move that to the Synopsys mix. Similar to the
effect of our business change a year ago, the mix change will depress
reported earnings from the "Avant!" orders in the short term. In
addition, the rules of purchase accounting for software companies make
it difficult to bring across the deferred revenue and backlog for
ratable licenses, since the future direct "cost to perform" is not
clear. This is an issue that we're currently discussing with the
Emerging Issues Task Force of the FASB and the SEC. It does not impact
the economic substance of this deal since we will still get the cash
payments and still provide the appropriate services. However, we may
not be able to recognize revenue for this backlog which will affect
both reported revenue and earnings. Based on the forecast we have
today, the net impact of both of these things is on the rough order of
a dollar per share of EBG, which would make the deal significantly
accretive in the short term. In any case, it will be significantly
accretive in the long term. As has been our practice, we will give
more quantitative specifics around the closing. And again as a
reminder, none of these forecasts include the effect of the closing of
the IKOS acquisition, which is expected to occur sometime in Q4 of
2002.
Thank you for your attention. I'll now turn it back to Aart for his
closing comments.
Aart
de Geus: Thank you Brad and Paul.
In conclusion let me just review the basis for my excitement about our
acquisition of Avant! which is threefold. First, it brings together
the best front-end technology with the best back-end technology,
resulting in the strongest design solution today. Second, it fulfills
a request that our customers have made for years and they are thrilled
that we are finally merging. And last, in a tough economic climate
winners make bold moves and we believe that we just made such a
winning move.
Thank you for your attention. Let's now open up for Q and A. Operator,
please poll for questions.
* * *
A question and answer period followed, the transcript of which is currently
being prepared and will be filed as a subsequent 425 as soon as it is available.
Additional Information
In connection with the proposed merger, Synopsys and Avant! will file a
joint proxy statement/prospectus with the SEC. INVESTORS AND SECURITY HOLDERS
ARE URGED TO READ THE JOINT PROXY STATEMENT / PROSPECTUS REGARDING THE PROPOSED
MERGER WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION.
Investors and security holders may obtain a free copy of the joint proxy
statement / prospectus (when available) and other related documents filed by
Synopsys and Avant! with the SEC at the SEC's website at www.sec.gov. The joint
proxy statement / prospectus (when it is available) and the other documents may
also be obtained for free by accessing Synopsys' website at www.synopsys.com or
by directing a request by mail or telephone to 700 E. Middlefield Road, Mountain
View, CA 94043, Attention: Company Secretary, (650) 584-5000, or by accessing
Avant!'s website at www.avanticorp.com or by directing a request by mail or
telephone to 4671 Bayside Parkway, Fremont, CA 94538, Attention: Company
Secretary, (510) 413-8000.
Synopsys, Avant!, and their respective directors, executive officers
and certain other members of management and employees may be soliciting proxies
from their respective stockholders in favor of the merger. Information regarding
the persons who may, under the rules of the SEC, be considered participants in
the solicitation of the Synopsys stockholders, or the Avant! stockholders, as
the case may be, in connection with the proposed merger, will be set forth in
the joint proxy statement / prospectus when it is filed with the SEC.