-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UOwK4m2E99yk0vmdDG4xIpR2FtRhw6Lzu/cRYnbW3mv+fL8XSehzx61IH5cSdEPn 7PqSuwQa3X3FH/HV62MYTQ== 0000950149-02-000092.txt : 20020414 0000950149-02-000092.hdr.sgml : 20020413 ACCESSION NUMBER: 0000950149-02-000092 CONFORMED SUBMISSION TYPE: SC TO-T/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20020123 GROUP MEMBERS: FRESNO CORPORATION SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: IKOS SYSTEMS INC CENTRAL INDEX KEY: 0000756365 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 770100318 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC TO-T/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-41223 FILM NUMBER: 02514806 BUSINESS ADDRESS: STREET 1: 19050 PRUNERIDGE AVE CITY: CUPERTINO STATE: CA ZIP: 94086 BUSINESS PHONE: 4082451900 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: MENTOR GRAPHICS CORP CENTRAL INDEX KEY: 0000701811 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 930786033 STATE OF INCORPORATION: OR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC TO-T/A BUSINESS ADDRESS: STREET 1: 8005 SW BOECKMAN RD CITY: WILSONVILLE STATE: OR ZIP: 97070-7777 BUSINESS PHONE: 5036857000 SC TO-T/A 1 f77751a7scto-ta.txt SCHEDULE TO-T, AMENDMENT #7 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------ SCHEDULE TO/A (RULE 14d-100) TENDER OFFER STATEMENT UNDER SECTION 14(d)(1) OR SECTION 13(e)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. 7) ------------------- IKOS SYSTEMS, INC. (NAME OF SUBJECT COMPANY (ISSUER)) MENTOR GRAPHICS CORPORATION FRESNO CORPORATION (NAMES OF FILING PERSONS (OFFERORS)) COMMON STOCK, PAR VALUE $0.01 PER SHARE, (TITLE OF CLASS OF SECURITIES) 451716203 (CUSIP NUMBER OF CLASS OF SECURITIES) WALDEN C. RHINES PRESIDENT AND CHIEF EXECUTIVE OFFICER MENTOR GRAPHICS CORPORATION 8005 S.W. BOECKMAN ROAD WILSONVILLE, OREGON 97070-7777 (503) 685-7000 (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF THE FILING PERSON) COPIES TO: JOHN J. HUBER, ESQ. CHRISTOPHER L. KAUFMAN, ESQ. LATHAM & WATKINS LATHAM & WATKINS 555 11TH STREET, N.W., SUITE 1000 135 COMMONWEALTH DRIVE WASHINGTON, D.C. 20004 MENLO PARK, CALIFORNIA 94025 (202) 637-2200 (650) 328-4600 Check the appropriate boxes below to designate any transactions to which the statement relates: [X] third-party tender offer subject to Rule 14d-1 [ ] issuer tender offer subject to Rule 13e-4 [ ] going private transaction subject to Rule 13e-3 [ ] amendment to Schedule 13D under Rule 13d-2 Check the following box if the filing is a final amendment reporting the results of the tender offer: [ ] This Amendment No. 7 to Tender Offer Statement on Schedule TO amends and supplements the Tender Offer Statement on Schedule TO filed with the Securities and Exchange Commission on December 7, 2001 (as previously amended, the "Schedule TO"), relating to a tender offer by Fresno Corporation, a Delaware corporation ("Purchaser") and a wholly-owned subsidiary of Mentor Graphics Corporation, an Oregon corporation ("Mentor"), to purchase all outstanding shares of common stock, par value $0.01 per share, and the related preferred stock purchase rights, of IKOS Systems, Inc., a Delaware corporation (the "Company"), for a purchase price of $11.00 per share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated December 7, 2001 (the "Offer to Purchase") and in the related Letter of Transmittal (the "Letter of Transmittal" which, together with the Offer to Purchase, as each may be amended and supplemented from time to time, constitute the "Offer"). Capitalized terms used herein and not defined herein have the respective meanings assigned such terms in the Offer to Purchase. ITEM 5. Past Contacts, Negotiations, Transactions and Agreements. Item 5 is hereby amended to add the following: On January 21, 2002, Latham & Watkins, counsel to Mentor and Purchaser, received a letter by facsimile from Gray Cary Ware & Freidenrich LLP, counsel to the Company, in the form attached to this Schedule TO as Exhibit (d)(7), which is incorporated by reference herein. On January 22, 2002, the Company announced that the Company's Board of Directors recommended not terminating the Synopsys Agreement in favor of the Mentor agreement that was delivered for execution by the Company on January 16, 2002. In response, Mentor issued a press release on January 23, 2002, the full text of which is filed as Exhibit (a)(5)(E) to this Schedule TO, which is incorporated by reference herein. ITEM 12. EXHIBITS Item 12 of the Schedule TO is hereby amended and supplemented as follows: (a)(1)(A) Offer to Purchase dated December 7, 2001.* (a)(1)(B) Letter of Transmittal.* (a)(1)(C) Notice of Guaranteed Delivery.* (a)(1)(D) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.* (a)(1)(E) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.* (a)(1)(F) Guidelines for Certification of Taxpayer Identification Number of Substitute Form W-9.* (a)(1)(G) Press release issued by Mentor Graphics Corporation on December 7, 2001.* (a)(1)(H) Summary Advertisement, published December 7, 2001.* (a)(1)(I) Complaint filed in the United States District Court for the District of Delaware on December 7, 2001.* (a)(1)(J) Complaint filed in the Chancery Court, New Castle County, Delaware on December 7, 2001.* (a)(5)(A) Press release issued by Mentor Graphics Corporation, dated December 20, 2001.* (a)(5)(B) Press release issued by Mentor Graphics Corporation, dated December 26, 2001.* (a)(5)(C) Press release issued by Mentor Graphics Corporation, dated January 15, 2002.* (a)(5)(D) Press Release issued by Mentor Graphics Corporation, dated January 16, 2002.* (a)(5)(E) Press Release issued by Mentor Graphics Corporation, dated January 23, 2002. (b) None. (c) None. (d)(1) Confidentiality Agreement dated June 16, 2000, between Mentor Graphics Corporation and IKOS Systems, Inc.* (d)(2) Letter from Gray Cary Ware & Freidenrich LLP to Latham & Watkins dated December 12, 2001, and form of confidentiality and standstill agreement.* (d)(3) Letter from Latham & Watkins to Gray Cary Ware & Freidenrich LLP dated December 18, 2001.* (d)(4) Letter from Gray Cary Ware & Freidenrich LLP to Latham & Watkins dated December 18, 2001.* (d)(5) Letter from Latham & Watkins to Gray Cary Ware & Freidenrich LLP dated January 16, 2002.* (d)(6) Proposed Agreement and Plan of Merger and Reorganization by and among Mentor, Purchaser and the Company.* (d)(7) Letter from Gray Cary Ware & Freidenrich LLP to Latham & Watkins dated January 21, 2002, and form of confidentiality and standstill agreement. (e) None. (f) None. (g) None. (h) None. - ------------------ *Previously filed. 2 SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: January 23, 2002 MENTOR GRAPHICS CORPORATION By: /s/ Gregory K. Hinckley ------------------------------------ Name: Gregory K. Hinckley Title: President FRESNO CORPORATION By: /s/ Gregory K. Hinckley ------------------------------------ Name: Gregory K. Hinckley Title: Chief Financial Officer 3 EXHIBIT INDEX (a)(1)(A) Offer to Purchase dated December 7, 2001.* (a)(1)(B) Letter of Transmittal.* (a)(1)(C) Notice of Guaranteed Delivery.* (a)(1)(D) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.* (a)(1)(E) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.* (a)(1)(F) Guidelines for Certification of Taxpayer Identification Number of Substitute Form W-9.* (a)(1)(G) Press release issued by Mentor Graphics Corporation on December 7, 2001.* (a)(1)(H) Summary Advertisement, published December 7, 2001.* (a)(1)(I) Complaint filed in the United States District Court for the District of Delaware on December 7, 2001.* (a)(1)(J) Complaint filed in the Chancery Court, New Castle County, Delaware on December 7, 2001.* (a)(5)(A) Press release issued by Mentor Graphics Corporation, dated December 20, 2001.* (a)(5)(B) Press release issued by Mentor Graphics Corporation, dated December 26, 2001.* (a)(5)(C) Press release issued by Mentor Graphics Corporation, dated January 15, 2002.* (a)(5)(D) Press Release issued by Mentor Graphics Corporation, dated January 16, 2002.* (a)(5)(E) Press Release issued by Mentor Graphics Corporation, dated January 23, 2002. (b) None. (c) None. (d)(1) Confidentiality Agreement dated June 16, 2000, between Mentor Graphics Corporation and IKOS Systems, Inc.* (d)(2) Letter from Gray Cary Ware & Freidenrich LLP to Latham & Watkins dated December 12, 2001, and form of confidentiality and standstill agreement.* (d)(3) Letter from Latham & Watkins to Gray Cary Ware & Freidenrich LLP dated December 18, 2001.* (d)(4) Letter from Gray Cary Ware & Freidenrich LLP to Latham & Watkins dated December 18, 2001.* (d)(5) Letter from Latham & Watkins to Gray Cary Ware & Freidenrich LLP dated January 16, 2002.* (d)(6) Proposed Agreement and Plan of Merger and Reorganization by and among Mentor, Purchaser and the Company.* (d)(7) Letter from Gray Cary Ware & Freidenrich LLP to Latham & Watkins dated January 21, 2002, and form of confidentiality and standstill agreement. (e) None. (f) None. (g) None. (h) None. - ------------------ *Previously filed. EX-99.(A)(5)(E) 3 f77751a7ex99-a5e.txt EXHIBIT (A)(5)(E) Exhibit (a)(5)(E) FOR IMMEDIATE RELEASE MENTOR GRAPHICS SAYS IKOS REFUSAL TO PURSUE MENTOR MERGER AGREEMENT AGAINST IKOS STOCKHOLDERS INTEREST WILSONVILLE, OR -- January 23, 2002 -- Mentor Graphics Corporation (Nasdaq: MENT) stated today that the refusal by the Board of Directors of IKOS Systems, Inc. (Nasdaq: IKOS) to take the steps necessary for IKOS to sign Mentor's merger agreement is against the interests of the IKOS stockholders. Walden C. Rhines, Chairman and Chief Executive Officer of Mentor Graphics, said, "From the perspective of an IKOS stockholder, we can't fathom why IKOS didn't take steps to put it in a position to sign the merger agreement we sent them on January 16. The IKOS Board decided once again that the Mentor deal is superior to the Synopsys agreement. IKOS even implied that the outlook for IKOS stockholders under the Synopsys agreement is worse than it was one month ago, when IKOS first determined that our proposal was superior." "Rather than focusing on the superiority of our $11.00 per share in cash tender offer, the IKOS Board seized on certain conditions to closing the Mentor deal as the basis not to proceed with our deal. This makes no sense. These conditions are far less risky to IKOS than the very problematic conditions to consummation of the Synopsys agreement. Moreover, as a practical matter, the Mentor conditions should last only ten business days while the risky Synopsys conditions will be in effect until a closing estimated for August or September 2002. As suggested by the IKOS filing with the SEC, IKOS is particularly worried about satisfying the IKOS financial performance and employee retention conditions in the Synopsys agreement," Dr. Rhines continued. "In light of IKOS' actions today, we think it is time for the IKOS Board to bring the Synopsys agreement -- an agreement that was signed over six months ago -- up for a vote so that the stockholders get an opportunity to let the Board know what they think of that deal, particularly as it compares to Mentor's," Dr. Rhines concluded. Pursuant to its all cash tender offer, Mentor Graphics is offering to acquire IKOS Systems for $11.00 per share in cash of IKOS common stock. Mentor Graphics' offer is not subject to any financing condition and is scheduled to expire at 12:00 Midnight, New York City time on Friday, January 25, 2002, unless extended. In addition, on January 16, 2002, Mentor Graphics delivered to IKOS a merger agreement executed by Mentor which is superior to IKOS than its existing Synopsys agreement. Mentor's execution of that agreement will not be revoked prior to January 31, 2002. ABOUT MENTOR GRAPHICS Mentor Graphics Corporation (Nasdaq: MENT) is a world leader in electronic hardware and software design solutions, providing products, consulting services and award-winning support for the world's most successful electronics and semiconductor companies. Established in 1981, Mentor Graphics reported revenues over the last 12 months of more than $600 million and employs approximately 3,000 people worldwide. Corporate headquarters are located at 8005 S.W. Boeckman Road, Wilsonville, Oregon 97070-7777; Silicon Valley headquarters are located at 1001 Ridder Park Drive, San Jose, California 95131-2314. World Wide Web site: www.mentor.com. Mentor Graphics is a registered trademark of Mentor Graphics Corporation. All other company or product names are the registered trademarks or trademarks of their respective owners. ### CONTACTS Mentor Graphics Corporation The Abernathy MacGregor Group Ryerson Schwark Chuck Burgess Tel: 503-685-1660 Jason Thompson Tel: 212-371-5999 EX-99.(D)(7) 4 f77751a7ex99-d7.txt EXHIBIT (D)(7) Exhibit (d)(7) [GRAY CARY LETTERHEAD] January 21, 2002 OUR FILE NO. 1090305-1 VIA FACSIMILE Mr. Christopher L. Kaufman Latham & Watkins 135 Commonwealth Drive Menlo Park, CA 94025 RE: MENTOR GRAPHICS CORPORATION AND IKOS SYSTEMS, INC. Dear Kit: I received your letter dated January 16, 2002 and the proposed merger agreement by and among Mentor Graphics Corporation ("Mentor"), Fresno Corporation and IKOS Systems, Inc. ("IKOS"), proffered in executed form (the "Mentor Proposal"). I have also discussed the Mentor Proposal with the IKOS Board of Directors. The IKOS Board has instructed me to advise you that the IKOS Board has unanimously determined in good faith that the Mentor Proposal would result in a Superior Proposal as defined under Section 5.2 of the Agreement and Plan of Merger and Reorganization by and among Synopsys, Inc. ("Synopsys"). Oak Merger Corporation and IKOS dated July 2, 2001, as amended (the "Synopsys Merger Agreement"). However, due to the conditions contained in the Mentor Proposal and the resulting risk of nonconsummation, the IKOS Board has determined that the Mentor Proposal does not constitute a Superior Proposal and that it is not in the best interests of the IKOS stockholders to terminate the Synopsys Merger Agreement in favor of the Mentor Proposal. A summary of the IKOS Board's determinations and the reasons for those determinations is contained in an amended Schedule 14D-9 filed on Tuesday, January 22, 2002 with the Securities and Exchange Commission. IKOS will continue to comply with its obligations under the Synopsys Merger Agreement. Accordingly, I have enclosed a copy of the form of nondisclosure agreement as required under the Synopsys Merger Agreement. Please have your client execute the nondisclosure agreement so that negotiations may proceed relating to the Mentor Proposal. GRAY CARY WARE & FREIDENRICH LLP Mr. Christopher L. Kaufman December 18, 2001 Page Two Very truly yours, GRAY CARY WARE & FREIDENRICH LLP By: /s/ Diane Holt Frankle ----------------------------- Diane Holt Frankle dfrankle@graycary.com cc: Ramon A. Nunez Joseph W. Rockom January 21, 2002 Mentor Graphics Corporation 8005 S.W. Boeckman Road Wilsonville, OR 97070-7777 Dear Sirs: In connection with your consideration of a possible transaction with IKOS Systems, Inc. and/or its subsidiaries or affiliates (collectively, with such subsidiaries or affiliates, the "Company"), the Company is prepared to make available to you certain information concerning the business, financial condition, operations, assets and liabilities of the Company. As a condition to such information being furnished to you and your directors, officers, employees, agents or advisors (including, without limitation, attorneys, accountants, consultants, bankers and financial advisors) (collectively, "Representatives"), you agree to treat any information concerning the Company (whether prepared by the Company, its advisors or otherwise and irrespective of the form of communication) which has been or will be furnished to you or to your Representatives by or on behalf of the Company (herein collectively referred to as the "Evaluation Material") in accordance with the provisions of this letter agreement, and to take or abstain from taking certain other actions hereinafter set forth. The term "Evaluation Material" shall be deemed to include all notes, analyses, compilations, studies, interpretations or other documents prepared by you or your Representatives which contain, reflect or are based upon, in whole or in part, the information furnished to you or your Representatives pursuant hereto. The term "Evaluation Material" does not include information which (i) is or becomes generally available to the public other than as a result of a disclosure by you or your Representatives, (ii) you can demonstrate was within your possession prior to its being furnished to you by or on behalf of the Company pursuant hereto, provided that the source of such information was not known by you to be bound by a confidentiality agreement with or other contractual, legal or fiduciary obligation of confidentiality to the Company or any other party with respect to such information; (iii) becomes available to you on a non-confidential basis from a source other than the Company or any of its Representatives, provided that such source is not known by you to be bound by a confidentiality agreement with or other contractual, legal or fiduciary obligation of confidentiality to the Company or any other party with respect to such information; or (iv) is independently developed by you without the use of any Evaluation Material. You hereby agree that you and your Representatives shall use the Evaluation Material solely for the purpose of evaluating a possible transaction between the Company and you, that the Evaluation Material will be kept confidential and that you and your Representatives will not disclose any of the Evaluation Material in any manner whatsoever, provided, however, that (i) you may make any disclosure of such information to which the Company gives its prior written consent and (ii) any of such information may be disclosed to your Representatives who 1 January 21, 2002 Page 2 need to know such information for the sole purpose of evaluating a possible transaction with the Company, who agree to keep such information confidential and who are provided with a copy of this letter agreement and agree to be bound by the terms hereof to the same extent as if they were parties hereto. In any event, you shall be responsible for any breach of this letter agreement by any of your Representatives and you agree, at your sole expense, to take all reasonable measures (including but not limited in court proceedings) to restrain your Representatives from prohibited or unauthorized disclosure or use of the Evaluation Material. Contrary provisions notwithstanding, Mentor Graphics Corporation shall be free to use any information in intangible form, including ideas, concepts, techniques and know-how contained therein, which may be retained in the minds of its employees who have had rightful access to Evaluation Material hereunder and who have not intentionally memorized such information for the specific purpose of retaining and subsequently disclosing it in violation of the restriction on disclosure herein, subject only to the valid patents and copyrights of the Company. In addition, you agree that, without the prior written consent of the Company, you and your Representatives will not disclose to any other person the fact that the Evaluation Material has been made available to you, that discussions or negotiations are taking place concerning a possible transaction involving the Company or any of the terms, conditions or other facts with respect thereto (including the status thereof), unless in the written opinion of your counsel such disclosure is required by law and then only with as much prior written notice to the Company as is practical' under the circumstances. Without limiting the generality of the foregoing, you further agree that, without the prior written consent of the Company, you will not, directly or indirectly, enter into any agreement, arrangement or understanding, or any discussions which might lead to such agreement, arrangement or understanding, with any other person regarding a possible transaction involving the Company. The term "person" as used in this letter agreement shall be broadly interpreted to include the media and any corporation, partnership, group, individual or other entity. In the event that you or any of your Representatives are requested or required (by deposition, interrogatories, requests for information or documents in legal proceedings, subpoena, civil investigative demand or other similar process) to disclose any of the Evaluation Material, you shall provide the Company with prompt written notice of any such request or requirement so that the Company may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this letter agreement. If, in the absence of a protective order or other remedy or the receipt of a waiver by the Company, you or any of your Representatives are nonetheless, in the written opinion of your counsel, legally compelled to disclose Evaluation Material to any tribunal or else stand liable for contempt or suffer other censure or penalty, you or your Representative may, without liability hereunder, disclose to such tribunal only that portion of the Evaluation Material which such counsel advises you is legally required to be disclosed, provided that you exercise your best efforts to preserve the confidentiality of the Evaluation Material, including, without limitation, by cooperating with the Company to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Evaluation Material by such tribunal. 2 January 21, 2002 Page 3 If you decide that you do not wish to proceed with a transaction with the Company, you will promptly inform the Company of that decision. In that case, or at any time upon the request of the Company for any reason, you will promptly deliver to the Company all documents (and all copies thereof) furnished to you or your Representatives by or on behalf of the Company pursuant hereto and provide written documentation that all such documents have been returned. In the event of such a decision or request, all other Evaluation Material prepared by you or your Representatives shall be destroyed and no copy thereof shall be retained. Notwithstanding the return or destruction of the Evaluation Material, you and your Representatives will continue to be bound by your obligations of confidentiality and other obligations hereunder. You understand and acknowledge that neither the Company nor any of its Representatives (including without limitation Needham & Company) make any representation or warranty, express or implied, as to the accuracy or completeness of the Evaluation Material. You agree that neither the Company nor any of its Representatives (including without limitation Needham & Company) shall have any liability to you or to any of your Representatives relating to or resulting from the use of the Evaluation Material. Only those representations or warranties which are made in a final definitive agreement regarding the transactions contemplated hereby, when, as and if executed, and subject to such limitations and restrictions as may be specified therein, will have any legal effect. In consideration of the Evaluation Material being furnished to you, you hereby agree that, for a period of 2 years from the date hereof, neither you nor any of your affiliates will solicit to employ any of the officers or employees of the Company so long as they are employed by the Company and the Company has neither been acquired nor licensed and or sold substantially all of its assets to a third party, without obtaining the prior written consent of the Company. In consideration of the Evaluation Material being furnished to you, you hereby further agree that, without the prior written consent of the Board of Directors of the Company, for a period of 2 years from the date hereof, neither you nor any of your affiliates (as such term is defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended), acting alone or as part of a group, will acquire or offer or agree to acquire, directly or indirectly, by purchase or otherwise, any voting securities (or direct or indirect rights or options to acquire any voting securities) of the Company, or otherwise seek to influence or control, in any manner whatsoever, the management or policies of the Company. The Company reserves the right to assign all of its rights, powers and privileges under this letter agreement (including, without limitation, the right to enforce all of the terms of this letter agreement) to any person who enters into the transactions contemplated by this letter agreement. It is understood and agreed that no failure or delay by the Company in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder. It is further understood and agreed that money damages would not be a sufficient remedy for any breach of this letter agreement by you or any of your Representatives and that the 3 January 21, 2002 Page 4 Company shall be entitled to equitable relief, including injunction and specific performance, as a remedy for any such breach. Such remedies shall not be deemed to be the exclusive remedies for a breach by you of this letter agreement but shall be in addition to all other remedies available at law or equity to the Company. In the event of litigation relating to this letter agreement, if a court of competent jurisdiction determines that you or any of your Representatives have breached this letter agreement, then you shall be liable and pay to the Company the reasonable legal fees incurred by the Company in connection with such litigation, including any appeal therefrom. This letter agreement supersedes all prior agreements between you and the Company with respect to Evaluation Material provided after the date hereof. This letter agreement shall be governed by and construed in accordance with the laws of the State of California. Please confirm your agreement with the foregoing by signing and returning one copy of this letter to the undersigned, whereupon this letter agreement shall become a binding agreement between you and the Company. ACCEPTED AND AGREED: IKOS Systems, Inc. Mentor Graphics Corporation By:_________________________________ By:___________________________________ Title:________________________________ 4 -----END PRIVACY-ENHANCED MESSAGE-----