Filed by Cadence Design Systems, Inc. Pursuant to Rule 425
Under the Securities Act of 1933
Subject Company: Simplex Solutions, Inc.
Commission File No.: 000-32487
This filing relates to a proposed merger between Cadence Design
Systems, Inc. ("Cadence") and Simplex Solutions, Inc. ("Simplex") pursuant to
the terms of an Agreement and Plan of Merger, dated as of April 24, 2002, by and
among Cadence, Simplex and Zodiac Acquisition, Inc.
On April 24, 2002, Cadence and Simplex held a conference call relating
to the proposed merger described above, which was also made available for replay
via a webcast. The following is a transcript of the conference call:
TRANSCRIPT OF CADENCE DESIGN SYSTEMS, INC. AND SIMPLEX SOLUTIONS, INC.
CONFERENCE CALL ON APRIL 24, 2002
Ray Bingham:
Thank you all for joining us this afternoon. I'm very pleased to
announce a combination of companies and teams that I believe will accelerate
Cadence's already-successful move to the forefront of next-generation design.
Cadence has signed a definitive agreement to acquire Simplex, in our
view the world's leading provider of extraction and analysis solutions for the
verification of digital IC design. It provides us with powerful, complementary
technology in the ever-more-crucial Design-for-Manufacturing space.
It also brings to Cadence some of the most talented technologists in
the world for interconnect and DFM, and a leadership team that shares our vision
of providing the best technology and complete design infrastructure solutions to
our customers.
The terms of the transaction are in the press release, but just a
couple of details. It's a stock deal valued at approximately $300 million, or
$18 per share.
We expect it to be dilutive by about a penny a quarter for the two
quarters following the close, and accretive thereafter. Notwithstanding that, we
are not changing guidance. We'd be happy to take your questions a little later.
Over the past 15 months, Cadence has made a series of bold moves to
become the best choice for next-generation design at 0.13 micron and below.
We're delivering these solutions today, and as you saw with our Q1 results -
they're producing business greater than our expectations.
First, I brought in Lavi Lev, a seasoned industry technology leader, to
lead the IC business. Lavi and his team have concentrated on current and future
technology challenges, customer requirements, operational excellence with a
sharp business focus.
Second, we've made a series of strategic, very targeted acquisitions -
including this one - in critical areas that are complementary to our strengths
in order to build on our already-strong technology.
o CadMOS' signal integrity solution prevents, analyzes and
repairs signal integrity problems that occur as wires come
closer together at 0.13 and beyond.
o Silicon Perspective's full chip virtual prototyping is
essential to high productivity for tens of millions of gates.
As a result of these additions, in March we introduced the
industry's first complete 0.13 micron flow - SoC Encounter.
Both CadMOS and SPC have been outperforming plan, and are
important revenue drivers.
o Plato, which closed today, adds very fast, high-capacity
routing technology for the next generation of SoC Encounter.
o And with Simplex, we add best-in-class extraction and analysis
technology, as well as an exciting development program for
future technologies focused on the X architecture and a
world-class, high-end digital chip design team with SoC Design
Foundry.
As with CadMOS, Silicon Perspective and Plato, it's not just technology
that attracted us to Simplex. Simplex has an outstanding team that will play a
key role in Cadence's future. Penny Herscher - Simplex Chairman and CEO - will
become Executive VP and chief marketing officer responsible for marketing,
strategy, Tality and the Simplex SoC Design Foundry. I'm excited to welcome her
onto my team to continue the transformation of Cadence.
And the technology team is very well-known. Aki Fujimura - Simplex
President and COO - will lead the Design-for-Manufacture business unit in the
Cadence IC Solutions business; and Steve Teig - Simplex CTO - will become
Cadence chief scientist and will join the office of the CTO.
The result: We'll be able to deliver the world's best design flow for
0.13 micron and below, and an unmatched technology team. The great work that the
Simplex team has been doing accelerates by what happens with the best delivery
channel in the world.
With that, I'd like to turn it over to Penny.
Penny Herscher:
Thanks, Ray. We are very excited as well to join Ray and his team as
Cadence catapults into the forefront of electronic design.
You may find yourself wondering: what just happened here?
A year and a half ago, as an industry, we were talking about
integrating synthesis and place & route as the way to solve timing closure
problems at 0.18 micron, and debating who had the most tapeouts in the physical
synthesis battle. Today, everything has changed.
At 0.13 micron and below, the problems are not as simple. Interconnect
physics is the dominant design issue. Designs are huge, with tens of millions of
gates. And manufacturing in copper is a new challenge. Our customers need
innovation and the best technology to design for the next generation of system
on chip.
Simplex helps solve these problems in three fundamental ways.
First, with the industry's best extraction and analysis solutions. With
our focus on power, complementary signal integrity and electromigration, we've
solved hundreds of customer design problems. Our solutions complement the
Cadence flow extremely well, and will provide customers with the best technology
available.
Second, with our SoC Design Foundry. We have an unmatched record of
designing high-end digital chips, and have achieved 100 percent First Silicon
Success. And while we won't be able to talk specifics until the merger closes,
we intend to combine the best practices from both Design Foundry and Tality to
develop a winning strategy.
Finally, the X architecture technology offers incredible promise, and
the X Initiative work we've been doing to help develop the industry supply chain
can immediately benefit Cadence.
So why come together now? This was not an easy decision, but customers
need these solutions now, and together we have a great opportunity to provide
them. Our goal: Bring solutions to market that comprehend all deep submicron
process effects, and enable first silicon success with the world's leading
technology.
What you see with this merger is a technology powerhouse company - one
that has the innovation, the products, the services, the people, and the vision
to help our customers win. It's a winning combination, and we're proud to be a
part of it.
Additional Information about the Proposed Merger and Where to Find It
Cadence Design Systems, Inc. and Simplex Solutions, Inc. intend to file
with the Securities and Exchange Commission a registration statement, including
a proxy statement/prospectus, and other relevant materials in connection with
the proposed merger. The proxy statement/prospectus will be mailed to the
stockholders of Simplex. Investors and security holders of Simplex are urged to
read the proxy statement/prospectus and the other relevant materials when they
become available because they will contain important information about Cadence,
Simplex and the proposed merger. The proxy
statement/prospectus and other relevant materials (when they become available),
and any other documents filed by Cadence or Simplex with the Securities and
Exchange Commission, may be obtained free of charge at the Securities and
Exchange Commission's web site at www.sec.gov. In addition, investors and
security holders may obtain free copies of the documents filed with the
Securities and Exchange Commission by Cadence by contacting Cadence Investor
Relations, 2655 Seely Avenue, Building 5, San Jose, California 95134, (408)
943-1234. Investors and security holders may obtain free copies of the documents
filed with the Securities and Exchange Commission by Simplex by contacting
Simplex Investor Relations, 521 Almanor Avenue, Sunnyvale, California 94085,
(408) 617-6100. Investors and security holders are urged to read the proxy
statement/prospectus and the other relevant materials when they become available
before making any voting or investment decision with respect to the proposed
merger.
Simplex and its executive officers and directors may be deemed to be
participants in the solicitation of proxies from the stockholders of Simplex in
favor of the proposed merger. A description of the interests of the executive
officers and directors in Simplex is set forth in the proxy statement for
Simplex's 2002 Annual Meeting of Stockholders, which was filed with the
Securities and Exchange Commission on January 10, 2002. This document is
available free of charge at the Securities and Exchange Commission's web site at
www.sec.gov and from Simplex by directing a request to Simplex Investor
Relations, 521 Almanor Avenue, Sunnyvale, California 94085, (408) 617-6100.
Investors and security holders may obtain more detailed information regarding
the direct and indirect interests of the executive officers and directors in the
proposed merger by reading the proxy statement/prospectus when it becomes
available.
Cautionary Note Regarding Forward-Looking Statements
This transcript contains forward-looking statements within the meaning
of the federal securities laws, including, without limitation, statements
regarding the following: the proposed merger between Cadence and Simplex and the
strategies, benefits, opportunities and financial results relating to the
proposed merger; Cadence's business and results; strategies, beliefs and
expectations regarding recent acquisitions; the Simplex leadership team and
technology team; beliefs and expectations regarding customers; and beliefs,
expectations and intentions regarding products, solutions and technologies.
These statements are subject to risks and uncertainties that could cause actual
results and events to differ materially, including, without limitation, the
following: the approval of the proposed merger by Simplex's stockholders; the
satisfaction of closing conditions, including the receipt of regulatory
approvals; the successful integration of Simplex's employees and technologies;
the rapid pace of technological change in the electronics and semiconductor
industries; fluctuations in the demand for Cadence's and Simplex's products,
services and solutions; possible development or marketing delays relating to
product offerings; and the introduction of new products by competitors or the
entry of new competitors into the markets for Cadence's and Simplex's products.
A detailed discussion of other risks and uncertainties that could cause actual
results and events to differ materially from such forward-looking statements is
included in Cadence's and Simplex's most recent filings with the Securities and
Exchange Commission. Neither Cadence nor Simplex undertakes any obligation to
update forward-looking statements to reflect events or circumstances occurring
after the date of this transcript.