Korean Joint Venture Term Sheet

Exhibit 10.16









SUMMIT DESIGN ASIA, LTD.

A Joint Venture between Summit Design Israel, Inc. ("Summit")

and Anam S&T Co., LTD. ("Anam")

TERMS AND CONDITIONS OVERVIEW



1.0 LOCATION/OFFICES - -------------------- Summit Design Asia, Ltd. (SDA) will be incorporated and have its headquarters in Hong Kong. It will maintain an office there with its Managing Director, Kuo Wu, initially located in Seoul, Korea.



In addition, SDA will immediately establish a branch office in Korea (SDA Korea). SDA Korea will be responsible for sales in the local Korean market as well as manufacturing and shipping products to other Asian countries (see below for more details).



2.0 SCOPE OF OPERATIONS - ----------------------- SDA will manufacture, market, sell, distribute and support all of the products of Summit Design, Inc. in the territory comprised of all Asia Pacific Countries but not including Japan.



3.0 FINANCING - ------------- SDA will be financed by initial investments from Summit of * * * and from Anam of * * *.



Bank accounts will be opened in Hong Kong in the name of SDA at an appropriate international bank with the capability to conduct efficient multi-currency, international wire transfers, letters of credit and other business services appropriate for SDA.



The accounts shall be US Dollar denominated and should have signers as follows:

Managing Director of SDA, up to $100,000.00

Controller of SDA, up to $10,000.00

Managing Director of SDA plus Controller of SDA, any amount

Cochairmen (jointly) of SDA with the Managing Director or Controller, any

It will be desirable to have an investment account as well as an operating account that idle funds can earn interest.



4.0 SDA OWNERSHIP - ----------------- SDA will issue * * * shares of common stock, Initial ownership will be:

Anam * * *

Summit * * *



Board members, management and employees will be awarded stock options not to exceed * * * shares in total. When exercised, these shares will reduce the share holdings of Anam and Summit on a pro rata basis at the time of exercise.





* Confidential Treatment Requested







For each dollar remitted to Anam by SDA for the purchase of the Copyright License, Summit will receive * * * of SDA stock. The final share distribution after full repayment of the copyright purchase price of * * * and execution of all stock options will be:



Anam * * *

Summit * * *

Option Holders * * *



5.0 SDA BOARD OF DIRECTORS - -------------------------- The SDA Board of Directors will initially be:

Stephen Kim Cochairman

Larry Gerhard Cochairman

Kuo Wu Member

K.H. Kwon Member



Board of Director members will be elected by vote of the SDA Shareholders. A slate of new members will be approved and presented by the present Board of Directors for shareholder approval. In the event that a member is terminated or resigns then prior to the termination or resignation the Board of Directors shall approve and appoint a replacement for the exiting member.



A "Majority Vote" of the Board of Directors shall require a seventy-five percent (75%) concurring vote.



6.0 COPYRIGHT LICENSE PURCHASE - ------------------------------ SDA will immediately acquire the existing Copyright License held by Anam for a purchase price of * * *. Payment for the Copyright License shall be made quarterly beginning April 1, 1997. The amount of each quarterly payment shall be equal to * * * of SDA's profit from operations for that quarter. Quarterly payments will continue until the * * * purchase price is paid in full. SDA may repay any amount of the unpaid balance as approved by a Majority Vote of the Board of Directors. Total repayment of the * * * is required prior to any cash distribution as defined in section 7.0.



The Territory as defined by the Copyright License shall be extended as defined in section 2.0. In addition the * * * paid to Summit as defined in the Copyright License shall be reduced from * * *. Appendix A is a copy of the Copyright License.



7.0 EXCESS CASH DISTRIBUTION - ---------------------------- SDA shall distribute excess cash to shareholders quarterly based on the cash balance of SDA. In the event that the cash balance of SDA is in excess of one million dollars ($1,000,000.00) then the excess shall be distributed to shareholders of SDA on a pro-rata basis.



8.0 MANUFACTURING - ----------------- The manufacturing activities of SDA will initially take place in SDA Korea. The extent of the activities is expected to be as follows:





* Confidential Treatment Requested









TDS: - Reproduction of object code tapes supplied by Summit

Design US

- Authorization codes will be supplied via Summit Design US

upon receipt of required information from SDA



Visual: - SDA will initially subcontract with Tiud in Israel to

manufacture Visual HDL Summit Israel will assist SDA with

setting up the manufacturing process for Visual HDL in

Korea. SDA will have the option of continuing ro

subcontract through Summit Israel for manufacturing if it

so desires.



9.0 ORDER PROCESSING/SHIPPING/INVOICING/PAYMENT - ----------------------------------------------- One objective of SDA is to minimize the tax burden on the production and sale of Summit products in the Far East. To accomplish this, the following order processing flow should be used.



Orders will be received by SDA in Hong Kong from the SDA distributors or direct sales branches (such as SDA Korea) where the products will be manufactured and shipped to either the final end users of distributors (depending on the local arrangement in the country) in the countries where SDA does business. The processing of orders by SDA Korea will be done under a services agreement between SDA and SDA Korea on a "cost-plus" basis. A cost-plus ten percent (10%) is a common level, with monthly service fee payments made to SDA Korea from SDA Hong Kong.



SDA Korea will notify SDA Hong Kong upon shipment so that the customer may be invoiced by SDA Hong Kong. SDA Hong Kong will then be responsible for collection and management of the cash.



PAYMENT OF SUMMIT COPYRIGHT FEES - -------------------------------- Payment of the fees due under the Copyright License which is to be sold to SDA by Anam will be paid within sixty (60) days after shipment of product to the customer. The payments will be made from the SDA Hong Kong bank accounts and will be made in US Dollars.



OPERATING PLAN FOR SDA - ---------------------- Appendix B depicts the estimated operating plans for SDA beginning in 1996.





Signatures:



Anam: Summit:



/s/ Stephen M. Kim /s/ Larry J. Gerhard 3/21 ____________________________ ____________________________ Stephen M. Kim Larry J. Gerhard President & CEO President & CEO Anam S&T Co., LTD. Summit Design Israel, Inc.



* Confidential Treatment Requested







APPENDIX A



COPYRIGHT LICENSE AGREEMENT

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PURPOSE: - -------



This Agreement is made and entered into this 28th day of December, 1994, by and between Anam S&T., Ltd., a corporation incorporated and existing under the laws of the Republic of Korea, having its registered place of office at 3rd Floor, Anam Building, 154-17, Samsung-Dong, Kangnam-Ku, Seoul, Korea (hereinafter "Anam"); and Summit Design, Inc., a corporation incorporated and existing under the laws of Delaware having its registered place of office at 9305 S.W. Gemini Drive, Beaverton, OR, 97005 U.S.A. (hereinafter referred to as "Summit"). Anam and Summit when considered together are hereinafter referred to as "The Companies".



TERMS: - -----



I. COPYRIGHTS LICENSE ("LICENSE"): - ------------------------------------



1. Under the terms of this agreement, Summit grants an exclusive License

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to Anam for the use of its copyrights for the Products in the

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2. "Products":

---------

a. * * *

b. * * *

c. * * *

d. * * *

e. * * *



3. Price:

-----

a. The purchase price of the License is * * *

b. The purchase price is nonrefundable.

c. The purchase price shall be paid according to the terms stated in

section III.



4. "Territory":

----------

a. The initial Territory of Korea, Australia, India, and the

b. The Territory can be extended to other Asian countries,

Australia, India and the Phillippines by written mutual consent

of the Companies.



5. Term:

----

a. The initial term of the License if Thirty (30) months.

b. The License can be extended after the initial term by written

mutual consent of the Companies.





* Confidential Treatment Requested









6. Termination:

-----------

a. This agreement and the License can be terminated at any time by

Anam with 30 days written notice.

b. This agreement and the License can be terminated at any time by

Summit with 30 days written notice and repurchase of the License.

i. In the event that Summit wishes to repurchase the License

any time during months 1-12, the repurchase price shall be

* * *.

ii. In the event that Summit wishes to repurchase the License

any time during months 13-24, the repurchase price shall be

* * *.

iii. In the event that Summit wishes to repurchase the License

any time during months 25-30, the repurchase price shall

be * * *.

c. This agreement and the License can be terminated at any time by

either party for cause with 15 days written notice if the cause

has not been cured within 30 days after notice.



7. Transfer:

--------

a. This License is non transferable unless approved in writing by

the Companies.

b. In the event that the Companies agree to establish a Joint

Venture Company ("JVC"), the License is transferrable to the JVC

under the terms of the JVC agreement.



II. Fees: - ----------



1. The following fees shall be paid to Summit in conjunction with the

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distribution of the shrinked wrapped software and under the terms

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listed in section III.

---------------------- a. License administration and documentation fee ("LAD")

i. LAD is * * of the actual sale price on commercial units

unless the sale discount is greater than * * of the

Commercial List Price; if the sale discount is greater than

* * of the Commercial List Price and Summit has not agreed

in writing to such discount then LAD is * * of the

Commercial List Price.

ii. LAD is * * of the actual sale price on education units

unless the sale discount is greater than * * of the

Education List Price; if the sale discount is greater than

* * of the Education List Price and Summit has not agreed in

writing to such discount then LAD is * * of the Education

List Price.

b. Technology administration and maintenance gee ("TAM")

i. TAM is * * of the actual sale price on commercial units

unless the sale discount is greater than * * of the

Commercial Price List; if the sale discount is greater than

* * of the Commercial Price List and Summit has not agreed

in writing to such discount then TAM is * * of the

Commercial Price List.

ii. TAM is * * of the actual sale price on education units

unless the sale discount is greater than * * of the

Education List Price; if the sale discount is greater than

* * of the Education List Price and Summit





* Confidential Treatment Requested

has not agreed in writing to such discount then TAM is * *

of the Education List Price.

c. Technical Support Fee ("TSF")

i. TSF is * * of the actual sale price of the Product of a

maintenance agreement is purchase by the customer or

otherwise provided to the customer.

ii. TSF is * * of the actual maintenance renewal price.



2. Commercial List Price and Education List Price are as follows:

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Product Commercial List Price Education List Price

------- --------------------- --------------------



SEE EXHIBIT 'A'



III. Payments - -------------

1. Purchase price of License:

--------------------------

a. First payment due 1/15/95 * * *

b. Second payment due 2/15/95 * * *

c. Final payment due 3/1/95 * * *



2. Fees as stated in section II:

----------------------------

a. All fees shall be paid within 60 days after shipment of Product

or a maintenance service agreement to the customer.

b. All fees shall be paid to Summit in U.S. dollars.

c. All fee percentages listed in Section II are net amounts paid to

(In the event a tax issue occurs, this issue will be negotiated

by The Companies.)



IV. Rights and Obligations: - -----------------------------



1. For as long as the License is in effect Anam shall have the right to

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manufacture, market, sell distribute and support the Products in the

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2. For as long as the License is in effect Anam shall have the right to

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request an authorization code and Summit shall have the obligation to

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immediately provide such code. Summit shall be obligated for the LAD

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fee paid by Anam to enter, maintain, and provide information for every

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customer of Anam. This customer data base shall contain complete

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configuration management problem lists and upgrade information

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required to insure complete customer satisfaction.

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* Confidential Treatment Requested



3. For as long as the License is in effect Summit shall have the

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obligation for the TAM fee paid to provide constant maintenance and

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sustaining engineering for the Products to insure their long term

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viability and correctness. New product releases shall be made

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available to Anam if and when they are completed and ready for market.

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/s/ Roger Bitter 12/28/94 /s/ K. H. Kwon 12/28/94

______________________________ __________________________

R.A. Bitter; Summit Design, Inc. K.H. Kwon; Anam S&T Ltd.





/s/ L. J. Gerhard 12/28/94 /s/ Stephen M. Kim

______________________________ __________________________

L.J. Gerhard; Summit Design, Inc. Stephen Kim; Anam S&T Ltd.





* Confidential Treatment Requested





EXHIBIT A



8.0 TDS Price List



KOREA



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Prices Effective: January 22, 1996

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Product Product Maint

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TDS Products ...