<PAGE>

THIS SUBORDINATED DEBENTURE HAS BEEN ISSUED PURSUANT TO REGULATION D 
PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND HAS 
NOT BEEN REGISTERED UNDER THE ACT.  THE DEBENTURES MAY NOT BE TRANSFERRED, 
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE AND CURRENT REGISTRATION 
STATEMENT UNDER THE ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH 
REGISTRATION.

NO. 5                                                                $350,000.00

          6% CONVERTIBLE SUBORDINATED DEBENTURE DUE FEBRUARY 13, 2000


    THIS CONVERTIBLE SUBORDINATED DEBENTURE ("Debenture") is one of a duly 
authorized issue of Debentures of Zycad Corporation, a corporation duly 
organized and existing under the laws of the State of Delaware (the 
"Company"), designated as its 6% Convertible Subordinated Debentures Due 
February 13, 2000 in an aggregate principal amount not exceeding Five Million 
U.S. Dollars (U.S. $5,000,000) (the "Debentures").

    FOR VALUE RECEIVED, the Company promises to pay to Lewis A Fraser, having 
an address c/o 100 South Biscayne Blvd., Suite 700, Miami, Florida, 33131, 
the holder hereof, or its order (the "Holder"), the principal sum of Three 
Hundred and Fifty Thousand United States Dollars (U.S. $350,000) on February 13,
2000 (the "Maturity Date") and to pay interest on the principal sum 
outstanding under this Debenture ("Outstanding Principal Amount"), at the 
rate of 6% per annum, accruing daily and due and payable semi-annually in 
arrears on the 13th day of February and August of each year (each an 
"Interest Payment Date"), with the first such payment due on August 13, 1997. 
Accrual of interest shall commence on the first business day to occur after 
the date hereof and shall continue until payment in full of the principal sum 
has been made.  The interest so payable will be paid to the person in whose 
name this Debenture is registered on the records of the Company regarding 
registration and transfers of the Debentures (the "Debenture Register"); 
provided, however, that the Company's obligation to a transferee of this 
Debenture arises only if such transfer, sale or other disposition is made in 
accordance with the terms and conditions of the Convertible Securities 
Subscription Agreement dated as of February 13, 1997 between the Company and 
Lewis A. Fraser  (the "Subscription Agreement").  The principal of and 
interest on this Debenture are payable in such coin or currency of the United 
States of America as of the time of payment is legal tender for payment of 
public and private debts, at the address last appearing on the Debenture 
Register of the Company as designated in writing by the Holder hereof from 
time to time, provided, however, that, in lieu of paying such interest in 
coin or currency, the Company may, at its option, pay interest on this 
Debenture for any Interest Payment Date by adding the amount of such interest 
to the Outstanding Principal Amount due under this Debenture ("PIK Interest") 
pursuant to a statement in the form of Exhibit 2 hereto ("PIK Statement") 
delivered by the Company to the Holder 

                                       -1-

<PAGE>

on or prior to the applicable Interest Payment Date.  If the cash interest 
due hereunder is not paid to the Holder by the applicable Interest Payment 
Date, then the Holder shall be entitled to the addition of PIK Interest 
hereunder and to the delivery of a PIK Statement with respect thereto.  Any 
PIK Interest when so added to the Outstanding Principal Amount due under this 
Debenture shall, for all purposes of this Debenture, be deemed to have been 
part of the principal indebtedness originally evidenced by this Debenture 
including, without limitation, for purposes of determining interest 
thereafter payable hereunder and amounts thereafter convertible into Common 
Stock hereunder. The Company will pay the principal of and all accrued and 
unpaid interest due upon this Debenture on the Maturity Date, to the Holder 
of this Debenture as of the tenth (10th) day prior to the Maturity Date and 
addressed to such Holder at the last address appearing on the Debenture 
Register.

    Payment of the principal indebtedness evidenced from time to time by this 
Debenture, and interest accrued thereon, shall be subject and subordinate, as 
provided in Exhibit 3 hereto, to the Company's Senior Debt.

    This Debenture is subject to the following additional provisions:

    1.   EXCHANGE.  The Debentures are exchangeable for an equal aggregate 
principal amount of Debentures of different denominations, of not less than 
$50,000 each as requested by the Holder surrendering the same.  No service 
charge will be made for such registration or transfer or exchange.

    2.   TRANSFERS.  This Debenture has been issued subject to investment 
representations of the original purchaser hereof and may be transferred or 
exchanged in the United States only in compliance with the Securities Act of 
1933, as amended (the "Act") and applicable state securities laws and in 
accordance with other applicable provisions hereof.  Prior to due presentment 
for transfer of this Debenture, the Company may treat the person in whose 
name this Debenture is duly registered on the Company's Debenture Register as 
the owner hereof for the purpose of receiving payment as herein provided and 
all other purposes, whether or not this Debenture be overdue, and the Company 
shall not be affected by notice to the contrary.

    3.   DEFINITIONS.  For purposes hereof the following definitions shall 
apply:

         "FIRST CLOSING" shall have the meaning provided in the Subscription 
Agreement.

         "SECOND CLOSING" shall have the meaning provided in the Subscription 
Agreement.

         "FIRST CLOSING DATE" shall have the meaning provided in the 
Subscription Agreement.

                                       -2-

<PAGE>

         "SECOND CLOSING DATE" shall have the meaning provided in the 
Subscription Agreement.

         "COMMON STOCK" shall mean the Common Stock, par value $0.10 per 
share of the Company.

         "CONVERSION DATE MARKET PRICE" shall mean, (as set forth in the 
schedule below,) an amount that is equal to X%, as set forth in the schedule 
below, (the "X Percentage") of the average of the Market Price for Shares of 
Common Stock on each of the five trading days immediately preceding the 
Holder Conversion Date, subject to adjustment from time to time as set forth 
in Paragraph 7 hereof and in Section 6 of the Registration Rights Agreement.

         Conversion Date
         (Days from First Closing Date)       X
         ------------------------------     -----
           0 to 90                          100%
          91 to 120                         85.0%
         121 to 150                         84.0%
         151 to 180                         83.0%
         181 to 210                         82.0%
         211 to 240                         81.0%
         241 to maturity                    80.0%

         "CONVERSION DEFICIENCY" shall have the meaning set forth in 
Paragraph 9(b).

         "CONVERSION NOTICE" shall have the meaning set forth in Paragraph 5(c).

         "CONVERSION RATE" shall have the meaning set forth in Paragraph 5(b).

         "EQUITY OFFERINGS" shall mean the issuance or sale by the Company of 
any Common Stock or securities which are convertible into or exchangeable for 
its Common Stock or any convertible securities, or any warrants or other 
rights to subscribe for or to purchase or any options for the purchase of its 
Common Stock or any such convertible securities (other than shares or options 
issued or which may be issued pursuant to the Company's employee or director 
option plans or shares issued upon exercise of options, warrants or rights 
outstanding on the First Closing Date and listed in the Exchange Act Reports).

         "HOLDER CONVERSION DATE" shall have the meaning set forth in 
Paragraph 5(c).

         "MARKET PRICE FOR SHARES OF COMMON STOCK" shall mean the price of 
one share of Common Stock determined as follows:

                                       -3-

<PAGE>

              (i)    If the Common Stock is listed on the Exchange (as 
defined in the Subscription Agreement), the lowest reported sales price on 
the date of valuation;

              (ii)   If the Common Stock is listed on a national securities 
exchange, the lowest reported sales price on the date of valuation;

              (iii)  If neither (i) nor (ii) apply but the Common stock is 
quoted in the over-the-counter market on the pink sheets or bulletin board, 
the lesser of (A) the lowest sales price or (B) the last reported "bid" price 
on the date of valuation; and

              (iv)   If neither clause (i), (ii) or (iii) above applies, the 
market value as determined by a nationally recognized investment banking firm 
or other nationally recognized financial advisor retained by the Company for 
such purpose, taking into consideration, among other factors, the earnings 
history, book value and prospects for the Company, and the prices at which 
shares of Common Stock recently have been traded.  Such determination shall 
be conclusive and binding on all persons.

         "PARAGRAPH 4 TRANSACTION" shall mean a merger, consolidation, or 
other transaction referred to in Paragraph 4.

         "POST-DEFICIENCY CONVERSION" shall have the meaning set forth in 
Paragraph 9(b).

         "SUBSCRIPTION AGREEMENT" shall mean the Convertible Securities 
Subscription Agreement dated as of February 13, 1997, between the Company and 
the Subscriber or Subscribers to the original issue of the Debentures and the 
Warrants.

         "WARRANTS" shall have the meaning provided in the Subscription 
Agreement.

    4.   MERGER, CONSOLIDATION.  If at any time there occurs any 
consolidation or merger of the Company with or into any other corporation or 
other entity or person (whether or not the Company is the surviving 
corporation) or any other corporate reorganization or transaction or series 
of related transactions, in any of which in excess of 50% of the Company's 
voting power is transferred (a "Paragraph 4 Transaction"), the Holders of 
this Debenture, to the extent then outstanding and notwithstanding anything 
in Paragraph 5(a) to the contrary, shall participate in any such transaction 
as a class with common stockholders of the Company on the same basis as if 
this Debenture had been converted one day prior the effective date of such 
transaction, provided, however, that if a Paragraph 4 Transaction or the 
record date for determination of the Company's stockholders entitled to 
participate in such Transaction shall occur at any time before the expiration 
of six (6) months following the effectiveness of the Registration Statement 
contemplated by the Registration Rights Agreement, both of which are referred 
to in the Subscription Agreement, then, at the option of the Holder of this 
Debenture, such Holder may treat the effective date of such Paragraph 4 
Transaction as the date for the redemption of this Debenture and shall be 
entitled to receive the redemption price with respect to such redemption date 
as is provided in Paragraph 9(b), as though such 

                                       -4-

<PAGE>

redemption date were the date of a Conversion Notice for purposes of such 
Paragraph 9(b).  Such Holder shall be entitled to make such election at any 
time up to ten (10) trading days after the effective date of the Paragraph 4 
Transaction.  Nothing in this Section 4 shall prohibit the Holder from 
converting any part or all of this Debenture in accordance with the terms 
hereof, up to and including the effective time and date of the Paragraph 4 
Transaction.

    5.   CONVERSION.  This Debenture is subject to conversion as follows:

         (a)  (i)   HOLDER'S RIGHT TO CONVERT.  This Debenture shall be 
convertible at any time, in whole or in part, at the option of the Holder 
hereof, into fully paid, validly issued and nonassessable shares of Common 
Stock.

              (ii)  AUTOMATIC CONVERSION.  At maturity of this Debenture, the 
principal indebtedness then outstanding hereunder (including without 
limitation all PIK Interest then included therein) shall automatically be 
converted into fully paid, validly issued and nonassessable shares of Common 
Stock and, except for the Holder's right to receive the Common Stock into 
which this Debenture is automatically so converted and except for any portion 
of this Debenture which cannot be so converted by reason of the limitations 
provided or referred to in Paragraphs 5(d) and 9(b) hereof, this Debenture 
shall be deemed to have been canceled whether or not surrendered upon such 
automatic conversion.

              (iii) ACCRUED BUT UNPAID INTEREST.  Notwithstanding anything in 
this Debenture to the contrary, the conversion of any part or all of the 
Outstanding Principal Amount of this Debenture shall include, without 
limitation, the conversion of all the accrued but unpaid interest on the 
Outstanding Principal Amount so converted.

         (b)  CONVERSION PRICE FOR HOLDER CONVERTED SHARES.  The Outstanding 
Principal Amount of this Debenture that is converted into shares of Common 
Stock shall be convertible into the number of shares of Common Stock which 
results from application of the following formula:

                                        P + I
                        _____________________________________
                             Conversion Date Market Price

          P = principal amount of this Debenture submitted for conversion
          I = accrued but unpaid interest on P as of the Holder Conversion Date

              The number of shares of Common Stock into which the Outstanding 
Principal Amount of this Debenture, and interest accrued thereon, may be 
converted pursuant to this paragraph is hereafter referred to the "Conversion 
Rate."

         (c)  MECHANICS OF CONVERSION.  In order to convert this Debenture 
(in whole or in part) into full shares of Common Stock, the Holder shall 
surrender this 

                                       -5-

<PAGE>

Debenture, duly endorsed, by either overnight courier or 2-day courier, to 
the principal office of the Company, and shall give written notice in the 
form of EXHIBIT 1 hereto (the "Conversion Notice") by facsimile (with the 
original of such notice forwarded with the foregoing courier) to the Company 
at such office that the Holder elects to convert the principal amount 
specified therein, which such notice and election shall be irrevocable by the 
Holder unless the Company shall default in or fail to fulfill any or all of 
its obligations arising hereunder or otherwise by reason of such notice or 
election, in which case, in addition to and not in lieu of any and all other 
rights and remedies to which the Holder may thereby be and become entitled, 
such notice and election, by further notice to the Company may be revoked and 
rescinded at the election of the Holder exercised in its sole discretion; 
PROVIDED, HOWEVER, that the Company shall not be obligated to issue 
certificates evidencing the shares of the Common Stock issuable upon such 
conversion unless either the Debenture evidencing the principal amount is 
delivered to the Company as provided above, or the Holder notifies the 
Company that such Debenture(s) have been lost, stolen or destroyed and 
promptly executes an agreement reasonably satisfactory to the Company to 
indemnify the Company from any loss incurred by its connection with such 
Debentures; and provided further that each Conversion Notice shall provide 
for the Holder's election to convert either (i) at least $50,000 of the 
Outstanding Principal Amount of the Debenture or Debentures so to be 
converted, or (ii) if such Outstanding Principal Amount shall then be less 
than $50,000, the entire amount thereof.

              Upon receipt of such Conversion Notice, the Company shall 
immediately verify the Holder's calculation of the Conversion Rate and shall 
use its best efforts to issue and deliver within three business days after 
delivery to the Company of such Debenture(s), or after receipt of such 
agreement and indemnification, to such Holder of Debenture(s) at the address 
of the Holder, or to its designee, a certificate or certificates for the 
number of shares of Common Stock to which the Holder shall be entitled as 
aforesaid, together with a Debenture or Debentures for the principal amount 
of Debentures not submitted for conversion.  The date on which the Conversion 
Notice is given (the "Holder Conversion Date") shall be deemed to be the date 
the Company received by facsimile the Conversion Notice, and the person or 
persons entitled to receive the shares of Common Stock issuable upon such 
conversion shall be treated for all purposes as the record holder or holders 
of such shares of Common Stock on such date.

         (d)  LIMITATION IN CONVERSION.  Notwithstanding anything herein 
contained to the contrary, the number of shares of Common Stock to be issued 
pursuant to a Conversion Notice or pursuant to the automatic conversion 
provided in Paragraph 5(a)(ii) hereof shall not exceed the number of such 
shares which, together with the Common Stock theretofore issued upon 
conversion of Debentures, would exceed 504,468 shares of Common Stock, as 
theretofore adjusted pursuant to the provisions hereof. 

    6.   [OMITTED]

    7.   STOCK SPLITS: DIVIDENDS, ADJUSTMENTS, REORGANIZATIONS.

                                       -6-

<PAGE>

         (a)  STOCK SPLITS AND COMBINATIONS.  The Company shall not effect or 
fix a record date for any stock split, subdivision or combination with an 
effective date within five (5) trading days of a Paragraph 4 Transaction.

         (b)  CERTAIN DIVIDENDS AND DISTRIBUTION.  The Company shall not 
make, or fix a record date for the determination of holders of Common Stock 
entitled to receive, a dividend or other distribution payable in additional 
shares of Common Stock, with an effective date within five (5) trading days 
of the effective date of a Paragraph 4 Transaction.

         (c)  ADJUSTMENT FOR OTHER DIVIDENDS AND DISTRIBUTIONS.  In the event 
the Company at any time or from time to time after the First Closing Date 
makes, or fixes a record date for the determination of holders of Common 
Stock entitled to receive, a dividend or other distribution payable in 
securities of the Company other than shares of Common Stock (including, 
without limitation, rights to acquire Common Stock or such other securities), 
then and in each such event provision shall be made so that the Holders of 
Debentures shall receive upon conversion thereof pursuant to Paragraph 5 
hereof, in addition to the number of shares of Common Stock receivable 
thereupon, the amount of such other securities of the Company to which a 
Holder on the relevant record or payment date, as applicable, of the number 
of shares of Common Stock so receivable upon conversion would have been 
entitled, plus any dividends or other distributions which would have been 
received with respect to such securities had such Holder thereafter, during 
the period from the date of such event to and including the Holder Conversion 
Date, retained such securities, subject to all other adjustments called for 
during such period under this Paragraph 7 with respect to the rights of the 
Holders of the Debentures.  For purposes of this Paragraph 7(c), the number 
of shares of Common Stock so receivable upon conversion by the Holder shall 
be deemed to be that number which the Holder would have received upon 
conversion of the entire Outstanding Principal Amount hereof if the Holder 
Conversion Date had been the day preceding the date upon which the Company 
announced the making of such dividend or other distribution.

         (d)  ADJUSTMENT FOR RECLASSIFICATION, EXCHANGE AND SUBSTITUTION.  In 
the event that at any time or from time to time after the First Closing Date, 
the Common Stock issuable upon the conversion of the Debentures is changed 
into the same or a different number of shares of any class or classes of 
stock, whether by recapitalization, reclassification or otherwise (other than 
a subdivision or combination of shares or stock dividend or reorganization 
provided for elsewhere in this Paragraph 7 or a merger or consolidation, 
provided for in Paragraph 4), then and in each such event each Holder of 
Debentures shall have the right thereafter to convert such Debenture into the 
kind of stock receivable upon such recapitalization, reclassification or 
other change by holders of shares of Common Stock all subject to further 
adjustment as provided herein.  In such event, the formulae set forth herein 
for conversion and redemption shall be equitably adjusted to reflect such 
change in number of shares or, if shares of a new class of stock are issued, 
to reflect the market price of the class or classes of stock (applying the 
same factors used in determining the Market Price for Shares of Common Stock) 
issued in connection with the above described transaction.

                                       -7-

<PAGE>

         (e)  REORGANIZATIONS.  If at any time or from time to time after the 
First Closing Date there is a capital reorganization of the Common Stock 
(other than a recapitalization, subdivision, combination, reclassification or 
exchange of shares provided for elsewhere in this Paragraph 7) then, as a 
part of such reorganization, provision shall be made so that the Holders of 
the Debentures shall thereafter be entitled to receive upon conversion of the 
Debentures the number of shares of stock or other securities or property to 
which a holder of the number of shares of Common Stock deliverable upon 
conversion would have been entitled on such capital reorganization.  In any 
such case, appropriate adjustment shall be made in the application of the 
provisions of this Paragraph 7 with respect to the rights of the Holders of 
the Debentures after the reorganization to the end that the provisions of 
this Paragraph 7 shall be applicable after that event and be as nearly 
equivalent as may be practicable, including, by way of illustration and not 
limitation, by equitably adjusting the formulae set forth herein for 
conversion and redemption to reflect the market price of the securities or 
property (applying the same factors used in determining the Market Price for 
Shares of Common Stock) issued in connection with the above described 
transaction.

         (f)  In the event of a reasonable, good faith dispute between a 
Holder of Debentures and the Company with respect to the adjustment required 
by Paragraph 7(d) or 7(e), then, at the option of either the Holder or the 
Company, the dispute shall be submitted to the American Arbitration 
Association for resolution according to the then applicable rules thereof.  
The cost of such proceeding shall be shared 50% by the Holder or Holders 
involved in the dispute and 50% by the Company, except that each party shall 
bear its own legal and other expenses.

    8.   FRACTIONAL SHARES.  No fractional shares of Common Stock or scrip 
representing fractional shares of Common Stock shall be issuable hereunder.  
The number of shares of Common Stock that are issuable upon any conversion 
shall be rounded up or down to the nearest whole share.

    9.   RESERVATION OF STOCK ISSUABLE UPON CONVERSION

         (a)  RESERVATION REQUIREMENT.  The Company has reserved and the 
Company shall continue to reserve and keep available at all times, free of 
preemptive rights, shares of Common Stock for the purpose of enabling the 
Company to satisfy any obligation to issue shares of its Common Stock upon 
conversion of the Debentures or upon exercise of Warrants; provided, however, 
that the number of shares so reserved shall at all times be at least 500,000 
shares.  The number of shares so reserved may be reduced by the number of 
shares actually delivered pursuant to conversion of Debentures and exercise 
of Warrants (provided that, in no event shall the number of shares so 
reserved be less than the maximum number required to satisfy remaining 
conversion rights on the unconverted Debentures and remaining exercise rights 
under any Warrants issued hereunder,) and the number of shares so reserved 
shall be increased to reflect stock splits and stock dividends and 
distributions.

                                       -8-

<PAGE>

         (b)  CONVERSION DEFICIENCY.  If the Company does not have a 
sufficient number of shares of Common Stock available to satisfy the 
Company's obligations to a Holder of Debentures or if (whether or not a 
Conversion Notice shall have been given with respect thereto) one or more 
Debentures cannot be fully converted pursuant to Paragraphs 5(a)(i) or (ii) 
by reason of the limitation provided in Section 5(d) (in either case, a 
"CONVERSION DEFICIENCY"), from and after the fifth (5th) day following a 
Conversion Deficiency , each Holder of the Debentures shall have the right to 
demand from the Company immediate redemption of any portion of the Debentures 
with respect to which the Company does not have a sufficient number of shares 
available so to satisfy such obligations of the Company or with respect to 
which conversion is limited by Paragraph 5(d), as the case may be, in either 
case in cash at a redemption price per Debenture equal to (A) the dollar 
amount which is the product of (x) the Conversion Rate then applicable to the 
Debentures so to be redeemed pursuant to this Paragraph 9(b) and (y) the last 
reported sales  price on the Exchange of the Company's Common Stock on the 
date on which the Conversion Notice was delivered or (B) 110% of the 
principal amount of the Debenture (including all PIK Interest) plus accrued 
but unpaid interest, whichever is greater; PROVIDED HOWEVER, that no notice 
of redemption may be delivered by a Holder subsequent to receipt by such 
Holder of notice from the Company (sent by overnight or 2-day courier with a 
copy sent by facsimile) of availability of sufficient shares of Common Stock 
to perfect conversion (a "POST DEFICIENCY CONVERSION") of all the Debentures; 
provided further that such right shall be reinstated if the Company shall 
thereafter fail to perfect such Post-Deficiency Conversion by delivery of 
Common Stock certificates in accordance with the applicable provisions of 
Paragraph 5(b) hereof and, to the extent not so converted, payment of all 
accrued and unpaid interest in cash with respect thereto within five business 
days of delivery of the notice of Post-Deficiency Conversion.  In addition to 
the foregoing, upon a Conversion Deficiency, the rate of interest on all of 
the Debentures shall, to the maximum extent permitted by applicable law, be 
increased by two percent (2%) (i.e. from 6% to 8%) commencing on the first 
day of the thirty (30) day periods (or part thereof) following a Conversion 
Deficiency, an additional three percent (3%) commencing on the first day of 
each of the second and third such thirty (30) day period (or part thereof), 
and an additional one percent (1%) on the first day of each consecutive 
thirty (30) day  period (or part thereof) thereafter until such securities 
have been duly converted (including any such conversion after a Post 
Deficiency Conversion) or redeemed as herein provided. Any such interest 
which is not paid when due shall, to the maximum extent permitted by law, 
accrue interest until paid at the rate from time to time applicable to 
interest on the Debentures as to which the Conversion Deficiency has occurred.

    10.  [Omitted]

    11.  NO IMPAIRING.  The Company shall not intentionally take any action 
which would impair the contractual rights and privileges of the Debentures 
set forth herein or of the Holders thereof.

    12.  HOLDERS' RIGHTS IF SHARES ARE DELISTED OR IF TRADING IN COMMON STOCK 
IS SUSPENDED.  In the event that at anytime on or after the date hereof and 
prior to the third 

                                       -9-

<PAGE>

anniversary of the First Closing Date, trading in the shares of the Company's 
Common Stock is suspended on the Exchange for such shares for a period of 
five consecutive trading days, other than as a result of the suspension of 
trading in securities in general, or if such Shares are delisted and not 
relisted within ten (10) days thereafter, then, at a Holder's option, the 
Company shall redeem such Holder's Debentures at a date designated by such 
Holder, and at the redemption price provided in Paragraph 9(b)  as though the 
date the Holder exercises such option were the date of a Conversion Notice 
for purposes of such Paragraph 9(b).

    13.  LIMITATIONS ON HOLDER'S RIGHT TO CONVERT.  Notwithstanding anything 
to the contrary contained herein, each Conversion Notice shall contain a 
representation that, after giving effect to the shares of the Company's 
Common Stock to be issued pursuant to such conversion notice, the total 
number of shares of the Company's Common Stock deemed beneficially owned by 
the Holder, together with all shares of the Company's Common Stock deemed 
beneficially owned by the Holder's "affiliates" as defined in Rule 144 of the 
Act, will not exceed 4.9% of the total issued and outstanding shares of the 
Company's Common Stock.

    14.  RIGHTS OF FIRST REFUSAL.  The Holders shall have a right of first 
refusal pro rata according to the Holder's ownership of Debentures on the 
date on which the Company's notice pursuant to this Paragraph 14 is given on 
any Equity Offerings (except for an offering of rights to subscribe for 
shares of the Company's Common Stock, provided the Holders in such case are 
given the right to subscribe for the number of shares to which they would 
have been entitled if they then held the shares of Common Stock into which 
the Debentures may have been converted),  for a period of one (1) year from 
the date hereof, so long as the Holders still hold any Debentures and 
provided such Equity Offerings are made pursuant to an exemption from the 
registration requirements of the Securities Act of 1933, as amended, 
including without limitation Regulation D and Regulation S thereunder.  The 
Company shall give the Holders written notice of its proposal to make such an 
Equity Offering and shall provide with such notice copies of the 
documentation, with the economic terms of the transaction specified, pursuant 
to which the Equity Offering is to be effected.  Such Holders shall have ten 
(10) business days from receipt of such notice to deliver a written notice to 
the Company that such Holders wish to exercise their right of first refusal 
with respect to such Equity Offering, provided that such offering is 
completed upon such terms and with such documentation within thirty (30) 
calendar days after said ten (10) day period.  If such Holders exercise their 
right of first refusal with respect to any Equity Offering, they must close 
the transactions contemplated by the proposed issuance within ten (10) 
business days of the exercise of their right hereunder on the same economic 
terms and using the same documentation provided in the Company's notice to 
the Holders.  If the Holders fail to close the transaction for any reason 
other than a breach by the Company of its obligations hereunder, such 
Holder's right of first refusal shall irrevocably terminate with respect to 
such Equity Offering.

    15.  OBLIGATIONS ABSOLUTE.  No provision of this Debenture, other than 
conversion as provided herein, shall alter or impair the obligation of the 
Company, which 

                                       -10-

<PAGE>

is absolute and unconditional, to pay the principal of, and interest on, this 
Debenture at the time, place and rate, and in the manner, herein prescribed.

    16.  WAIVERS OF DEMAND, ETC.  The Company hereby expressly waives demand 
and presentment for payment, notice of nonpayment, protest, notice of 
protest, notice of dishonor, notice of intent to accelerate, prior notice of 
bringing of suit and diligence in taking any action to collect amounts called 
for hereunder and will be directly and primarily liable for the payments of 
all sums owing and to be owing hereon, regardless of and without any notice 
(except as required by law), diligence, act or omission as or with respect to 
the collection of any amount called for hereunder.

    17.  REPLACEMENT DEBENTURES.  In the event that any Holder notifies the 
Company that its Debenture(s) have been lost, stolen or destroyed, 
replacement Debenture(s) identical in all respects to the original 
Debenture(s) (except for registration number and Outstanding Principal 
Amount, I f different than that shown on the original Debenture(s)) shall be 
issued to the Holder, provided that the Holder executes and delivers to the 
Company an agreement reasonably satisfactory to the Company to indemnify the 
Company from any loss incurred by it in connection with such Debenture(s).

    18.  PAYMENT OF EXPENSES.  The Company agrees to pay all debts and 
expenses, including reasonable attorneys' fees, which may be incurred by the 
Holder in enforcing the provisions of this Debenture and/or collecting any 
amount due under this Debenture, the Subscription Agreement or the 
Registration Rights Agreement dated as of February 13, 1997, among the 
Company and Holders of Debentures.

    19.  DEFAULTS.  If one or more of the following described "Events of 
Default" shall occur:

         (a)  The Company shall default in the payment of (i) interest on this
              Debenture, and such default shall continue for five (5) business
              days after the due date thereof, or (ii) the principal of this
              Debenture; or

         (b)  Any of the representations or warranties made by the Company
              herein, in the Subscription Agreement, or in any certificate or
              financial or other written statements of the Company heretofore
              or hereafter furnished by or on behalf of the Company in
              connection with the execution and delivery of this Debenture or
              the Subscription Agreement shall be false or (when taken together
              with other information furnished by or on behalf of the Company,
              including Exchange Act Reports) misleading in any material
              respect at the time made; or

         (c)  The Company shall fail to perform or observe any covenant or
              agreement in the Subscription Agreement, or any other covenant, 

                                       -11-

<PAGE>

              term, provision, condition, agreement or obligation of the
              Company under this Debenture and such failure shall continue
              uncured for a period of ten (10) business days after notice from
              the Holder of such failure; or

         (d)  The Company shall (1) become insolvent; (2) admit in writing its
              inability to pay its debts generally as they mature; (3) make a
              general assignment for the benefit of creditors or commence
              proceedings for its dissolution; or (4) apply for or consent to
              the appointment of a trustee, liquidator or receiver for it or
              for a substantial part of its property or business; or

         (e)  A trustee, liquidator or receiver shall be appointed for the
              Company or for a substantial part of its property or business
              without its consent and shall not be discharged within forty-five
              (45) days after such appointment; or

         (f)  Any governmental agency or any court of competent jurisdiction at
              the instance of any governmental agency shall assume custody or
              control of the whole or any substantial portion of the properties
              or assets of the Company and shall not be dismissed within
              forty-five (45) days thereafter, or

         (g)  Any money judgment, writ or warrant of attachment, or similar
              process in excess of Five Hundred Thousand Dollars ($500,000) in
              the aggregate shall be entered or filed against the Company or
              any of its properties or other assets and shall remain unpaid,
              unvacated, unbonded and unstayed for a period of forty-five (45)
              days or in any event later than ten (10) days prior to the date
              of any proposed sale thereunder; or

         (h)  Bankruptcy, reorganization, insolvency or liquidation 
              proceedings or other proceedings, or relief under any bankruptcy
              law or any law for the relief of debt shall be instituted by or
              against the Company and, if instituted against the Company, shall
              not be dismissed within forty-five (45) days after such
              institution or the Company shall by any action or answer approve
              of, consent to, or acquiesce in any such proceedings or admit to
              any material allegations of, or default in answering a petition
              filed in, any such proceeding;

then, or at any time thereafter, and in each and every such case, unless such 
Event of Default shall have been waived in writing by the Holder (which 
waiver shall not be deemed to be a waiver of any subsequent default) at the 
option of the Holder and in the Holder's sole discretion, the Holder may, by 
notice to the Company declare the Debenture immediately due and payable, and 
the Holder may immediately, and without expiration of any period of grace, 
enforce any and all of the Holder's rights and remedies 

                                       -12-

<PAGE>

provided herein or any other rights or remedies afforded by law.  In such 
event, the Debenture shall be redeemed at a redemption price per Debenture 
equal to the redemption price provided in Paragraph 9(b) , as though the date 
of such decleration hereunder were the date of a Conversion Notice for 
purposes of such Paragraph 9(b).

    20.  SAVINGS CLAUSE.  In case any provision of this Debenture is held by 
a court of competent jurisdiction to be excessive in scope or otherwise 
invalid or unenforceable, such provision shall be adjusted rather than 
voided, if possible, so that it is enforceable to the maximum extent 
possible, and the validity and enforceability of the remaining provisions of 
this Debenture will not in any way be affected or impaired thereby.

    21.  ENTIRE AGREEMENT.  This Debenture and the agreements referred to in 
this Debenture constitute the full and entire understanding and agreement 
between the Company and the Holder with respect to the subject hereof.  
Neither this Debenture nor any term hereof may be amended, waived, discharged 
or terminated other than by a written instrument signed by the Company and a 
majority-in-interest of the Holders.

    22.  ASSIGNMENT, ETC.  The Holder may, subject to compliance with the 
Subscription Agreement, without notice, transfer or assign this Debenture or 
any interest herein and may mortgage, encumber or transfer any of its rights 
or interest in and to this Debenture or any part hereof and, without 
limitation, each assignee, transferee and mortgagee (which may include any 
affiliate of the Holder) shall have the right to transfer or assign its 
interest; provided, however, that before the Registration Statement 
contemplated by the Registration Rights Agreement becomes effective, (i) each 
such assignee, transferee and mortgagee shall be a sophisticated investor as 
contemplated by Section 2.3 of the Subscription Agreement and each such 
assignment, transfer, mortgagee or other encumbrance shall comply with 
Regulation D under the Securities Act as though such transaction has been a 
part of the original offer and sale of the Debentures by the Company and 
Regulation D was applicable thereto, or (ii) the holder will furnish the 
Company with an opinion of counsel to the effect that such assignment, 
transfer, mortgage or other encumbrance is otherwise exempt from the 
registration requirements under the Securities Act.  Each such assignee, 
transferee and mortgagee shall have all of the rights and obligations of the 
Holder under this Debenture.  The Company agrees that, subject to compliance 
with the Subscription Agreement, after receipt by the Company of written 
notice of assignment from the Holder or from the Holders' assignee, all 
principal, interest, and other amounts which are then due and thereafter 
become due under this Debenture shall be paid to such assignee at the place 
of payment designated in such notice.  This Debenture shall be binding upon 
the Company and its successors and shall inure to the benefit of the Holder 
and its successors and assigns.

    23.  NO WAIVER.  No failure on the part of the Holder to exercise, and no 
delay in exercising any right, remedy or power hereunder shall operate as a 
waiver thereof, nor shall any single or partial exercise by the Holder of any 
right, remedy or power hereunder preclude any other or future exercise of any 
other right, remedy or power.  Each and every right, remedy or power hereby 
granted to the Holder or allowed it by law or other 

                                       -13-

<PAGE>

agreement shall be cumulative and not exclusive of any other, and may be 
exercised by the Holder from time to time.

    24.  MISCELLANEOUS.  Unless otherwise provided herein, any notice or 
other communication to a party hereunder shall be sufficiently given if in 
writing and personally delivered or mailed to said party by certified mail, 
return receipt requested, with a copy in each case sent on the same day to 
the addressee by Federal Express or other such expedited means with delivery 
confirmed by such means, at its address set forth herein or such other 
address as either may designate for itself in such notice to the other and 
communications shall be deemed to have been received when delivered 
personally or when actually received by the party to whom it is addressed.  
Whenever the sense of this Debenture requires, words in the singular shall be 
deemed to include the plural and words in the plural shall be deemed to 
include the singular.  If more than one Company is named herein, the 
liability of each shall be joint and several.  Paragraph headings are for 
convenience only and shall not affect the meaning of this document.

    25.  CHOICE OF LAW AND VENUE:  WAIVER OF JURY TRIAL.  THIS DEBENTURE 
SHALL BE CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO 
PRINCIPLES OF CONFLICTS OF LAW OR CHOICE OF LAW.  The Company hereby agrees 
that all actions or proceedings arising directly or indirectly from or in 
connection with this Debenture shall, at the Holder's sole option, be 
litigated only in the United States District Court for the Southern District 
of New York located in New York County, New York.  The Company consents to 
the jurisdiction and venue of the foregoing courts and consents that any 
process or notice of motion or other application to either of said courts or 
a judge thereof may be served inside or outside the State of New York or the 
Southern District of New York by registered mail, return receipt requested, 
directed to the Company at its address set forth in this Debenture (and 
service so made shall be deemed complete five (5) days after the same has 
been posted as aforesaid) or by personal service or in such other manner as 
may be permissible under the rules of said courts.

                                       -14-

<PAGE>

    IN WITNESS WHEREOF, the Company has caused this instrument to be duly 
executed by an officer thereunto duly authorized.

                              Dated as of:  February 13, 1997

                              ZYCAD CORPORATION 


                              By: /s/ Phillips W. Smith
                                 -----------------------------------------------
                              Print Name: Phillips W. Smith
                                         ---------------------------------------
                              Print Title: President and Chief Executive Officer
                                          --------------------------------------
                              Print Address:
                                            ------------------------------------


ATTEST

/s/ Douglas E. Klint
--------------------------------------

                                       -15-