<SUBMISSION>
<ACCESSION-NUMBER>0000907687-01-500045
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>2
<PERIOD>20010701
<FILING-DATE>20010814
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ACTEL CORP
<CIK>0000907687
<ASSIGNED-SIC>3674
<IRS-NUMBER>770097724
<STATE-OF-INCORPORATION>CA
<FISCAL-YEAR-END>0102
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-21970
<FILM-NUMBER>1710272
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>955 EAST ARQUES AVE
<CITY>SUNNYVALE
<STATE>CA
<ZIP>94086
<PHONE>4087391010
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>955 EAST ARQUES AVE
<STREET2>955 EAST ARQUES AVE
<CITY>SUNNYVALE
<STATE>CA
<ZIP>94086
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>q22001.txt
<DESCRIPTION>QUARTERLY REPORT ON FORM 10-Q
<TEXT>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM 10-Q

(Mark One)

    X     QUARTERLY  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE  SECURITIES
          EXCHANGE ACT OF 1934

For the quarterly period ended July 1, 2001

                                       OR

          TRANSITION  REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES
          EXCHANGE ACT OF 1934

Commission file number 0-21970

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

                                ACTEL CORPORATION
             (Exact name of Registrant as specified in its charter)

                California                                       77-0097724
      (State or other jurisdiction of                         (I.R.S. Employer
      incorporation or organization)                        Identification No.)

          955 East Arques Avenue
           Sunnyvale, California                                 94086-4533
 (Address of principal executive offices)                        (Zip Code)

                                 (408) 739-1010
              (Registrant's telephone number, including area code)

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

     Indicate  by check mark  whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant  was required to file such  reports) and (2) has been subject to such
filing requirements for the past 90 days.     Yes X         No

     Number of  shares  of Common  Stock  outstanding  as of  August  10,  2001:
23,861,791

<PAGE>


                         PART I -- FINANCIAL INFORMATION

Item 1.       Financial Statements.
<TABLE>
<CAPTION>

                                                     ACTEL CORPORATION

                                       CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                                      (unaudited, in thousands except per share amounts)


                                                            Three Months Ended                  Six Months Ended
                                                 ----------------------------------------  --------------------------
                                                    Jul. 1,      Jul. 2,       Apr. 1,       Jul. 1,       Jul. 2,
                                                      2001         2000          2001          2001          2000
                                                 ------------  ------------  ------------  ------------  ------------
<S>                                              <C>           <C>           <C>           <C>           <C>
Net revenues................................     $     36,460  $     55,544  $     45,034  $     81,494  $    106,210
Costs and expenses:
   Cost of revenues.........................           17,572        20,949        16,874        34,446        40,157
   Research and development.................            9,103         8,888         9,764        18,867        17,239
   Selling, general, and administrative.....           10,289        11,827        11,184        21,473        23,356
   Amortization of goodwill and other
     acquisition-related intangibles........            3,729         1,544         3,749         7,478         2,567
   Purchased in-process research and
     development............................             --           5,558          --            --           5,558
                                                 ------------  ------------  ------------  ------------  ------------
         Total costs and expenses...........           40,693        48,766        41,571        82,264        88,877
                                                 ------------  ------------  ------------  ------------  ------------
Income (loss) from operations...............           (4,233)        6,778         3,463          (770)       17,333
Interest income and other, net..............            2,023         1,859         2,085         4,108         3,164
Gain on sale of Chartered Semiconductor
 common stock...............................             --          28,329          --            --          28,329
                                                 ------------  ------------  ------------  ------------  ------------
Income (loss) before tax provision and equity
   in net loss of equity method investee....           (2,210)       36,966         5,548         3,338        48,826
Equity in net (loss) of equity method investee           --            (356)         --            --            (479)
Tax provision...............................              421        16,498         2,753         3,174        20,136
                                                 ------------  ------------  ------------  ------------  ------------
Net income (loss)...........................     $     (2,631) $     20,112  $      2,795  $        164  $     28,211

Net income (loss) per share:
   Basic....................................     $      (0.11) $       0.86  $       0.12  $       0.01  $       1.23
                                                 ============  ============  ============  ============  ============
   Diluted..................................     $      (0.11) $       0.77  $       0.11  $       0.01  $       1.09
                                                 ============  ============  ============  ============  ============

Shares used in computing net income (loss)
 per share:
   Basic....................................           23,642        23,263        23,472        23,557        23,015
                                                 ============  ============  ============  ============  ============
   Diluted..................................           23,642        26,186        25,126        25,113        25,907
                                                 ============  ============  ============  ============  ============
</TABLE>

<PAGE>


                                ACTEL CORPORATION

                      CONSOLIDATED CONDENSED BALANCE SHEETS
                            (unaudited, in thousands)

                                                    Jul. 1,       Dec. 31,
                                                      2001          2000
                                                  ------------  ------------
                                     ASSETS

Current assets:
   Cash and cash equivalents..................    $      5,576  $      9,266
   Short-term investments.....................         128,334       131,544
   Accounts receivable, net...................          14,490        29,256
   Inventories, net...........................          33,438        25,503
   Deferred income taxes......................          26,118        26,118
   Prepaid expenses and other current assets..           4,232         7,598
                                                  ------------  ------------
         Total current assets.................         212,188       229,285
Property and equipment, net...................          13,363        12,137
Goodwill, net.................................          43,699        47,470
Other assets, net.............................          25,923        23,542
                                                  ------------  ------------
                                                  $    295,173  $    312,434
                                                  ============  ============

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Accounts payable...........................    $     11,902  $     14,921
   Accrued salaries and employee benefits.....           9,490        17,200
   Other accrued liabilities..................           4,586         5,354
   Income taxes payable.......................           1,497          --
   Deferred income............................          31,091        44,858
                                                  ------------  ------------
         Total current liabilities............          58,566        82,333
   Deferred compensation plan liability.......           1,934          --
                                                  ------------  ------------
         Total liabilities....................          60,500        82,333
Commitments and contingencies
Shareholders' equity:
   Common stock...............................              24            23
   Additional paid-in capital.................         154,169       150,709
   Retained Earnings..........................          80,072        79,908
   Note receivable from officer...............            (368)         (368)
   Unearned compensation cost.................            (430)         (922)
   Accumulated other comprehensive income.....           1,206           751
                                                  ------------  ------------
         Total shareholders' equity...........         234,673       230,101
                                                  ------------  ------------
                                                  $    295,173  $    312,434
                                                  ============  ============
<PAGE>


                                ACTEL CORPORATION

                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                            (unaudited, in thousands)

                                                           Six Months Ended
                                                        ----------------------
                                                         Jul. 1,      Jul. 2,
                                                           2001         2000
                                                        ---------    ---------
Operating activities:
   Net income .......................................   $     164    $  28,211
   Adjustments to reconcile net income to net cash
    provided by (used in) operating activities:
     Depreciation and amortization ..................      10,995        6,538
     Equity in net loss of equity method investee ...        --            479
     Unearned compensation cost recognized ..........         157         --
     Gain on sale of Chartered Semiconductor stock ..        --        (28,329)
     Purchased in-process research and development ..        --          5,558
     Changes in operating assets and liabilities:
       Accounts receivable ..........................      14,766       (5,143)
       Inventories ..................................      (7,935)      (1,437)
       Other current assets .........................       3,366         (187)
       Accounts payable, accrued salaries and
        employee benefits, and other accrued
        liabilities .................................     (11,668)       7,767
       Deferred compensation plan net assets ........        (124)        --
       Deferred income ..............................     (13,767)       5,799
       Deferred income taxes ........................        (664)        (822)
                                                        ---------    ---------
   Net cash (used in) provided by operating activities     (4,710)      18,434
                                                        ---------    ---------
Investing activities:
   Purchases of property and equipment ..............      (4,743)      (2,169)
   Purchases of available-for-sale securities .......     (97,180)    (154,935)
   Sales of available-for-sale securities ...........     101,295      113,840
   Proceeds from sale of Chartered Semiconductor
    common stock ....................................        --         39,009
   Cash acquired in Prosys acquisition ..............        --             43
   Note receivable from GateField ...................        --         (1,000)
   Other assets .....................................      (2,313)          24
                                                        ---------    ---------
   Net cash (used in) investing activities ..........      (2,941)      (5,188)
                                                        ---------    ---------
Financing activities:
   Receipt of note payable from officer .............        --           (368)
   Proceeds from sale of common stock ...............       3,961        9,827
                                                        ---------    ---------
   Net cash provided by financing activities ........       3,961        9,459
                                                        ---------    ---------
Net increase (decrease) in cash and cash equivalents       (3,690)      22,705
Cash and cash equivalents, beginning of period ......       9,266        4,939
                                                        ---------    ---------
Cash and cash equivalents, end of period ............   $   5,576    $  27,644
                                                        =========    =========
Supplemental disclosures of cash flow information:
   Cash paid for taxes ..............................   $     199    $  10,371
Supplemental disclosures of non-cash transactions:
   Issuance of common stock in conjunction with
    Prosys aquisition ...............................        --      $   7,526


<PAGE>


1.   Basis of Presentation and Summary of Significant Accounting Policies

     The  accompanying  unaudited  consolidated  financial  statements  of Actel
Corporation  (Actel) have been prepared in accordance  with  generally  accepted
accounting   principles  for  interim   financial   information   and  with  the
instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly,  these
financial  statements  do  not  include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements. In the opinion of management,  all adjustments (consisting of normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.

     The consolidated financial statements include the accounts of Actel and its
wholly  owned   subsidiaries.   All   significant   intercompany   accounts  and
transactions  have been  eliminated  in  consolidation.  The  interim  financial
statements should be read in conjunction with the audited  financial  statements
included in Actel's  Annual Report on Form 10-K for the year ended  December 31,
2000. The results of operations for the three and six months ended July 1, 2001,
are not  necessarily  indicative  of results that may be expected for the entire
fiscal year, which ends January 6, 2002.

2.   Derivatives and Hedging

     On  January  1, 2001,  Actel  adopted  Statement  of  Financial  Accounting
Standards  (SFAS) No. 133,  "Accounting  for Derivative  Instruments and Hedging
Activities." SFAS 133 requires that all derivatives be recognized on the balance
sheet at fair market value.  Derivatives that are not hedges must be adjusted to
fair value through  earnings.  If the  derivative  is a hedge,  depending on the
nature of the  hedge,  changes in the fair  value of the  derivative  are either
offset against the change in the fair value of the hedged item through  earnings
or recognized in other comprehensive  income until the hedged item is recognized
in earnings.  The ineffective  portion of a derivative's change in fair value is
immediately  recognized  in  earnings.  The  adoption of SFAS 133 did not have a
material impact on Actel's consolidated financial position or operating results.

     Actel  purchases a portion of its wafers used in production from a Japanese
supplier  denominated  in  Japanese  Yen.  The  amount  of US  Dollars  that are
necessary  to purchase  wafers is subject to  fluctuations  in foreign  currency
exchange rates between the US Dollar and Yen. Actel enters into foreign exchange
forward  contracts  to reduce the  variability  in the amount of US Dollars that
will be required to settle forecasted wafer purchases denominated in Yen.

     Actel's  accounting  policies  for  these  forward  contracts  are based on
Actel's  designation of the Yen forward  contracts as foreign currency cash flow
hedges.  The  criteria  Actel  uses for  designating  an  instrument  as a hedge
includes its effectiveness in exposure reduction and one-to-one  matching of the
derivative  financial  instrument with the underlying  transaction being hedged.
Hedge  effectiveness  is assessed by  comparing  the change in fair value of the
forward contract with the change in fair value of the forecasted payments. Gains
and losses on these contracts are recognized upon usage of the contracts and are
included  in  cost  of  sales  along  with  the  offsetting  gain or loss on the
underlying  transactions  being hedged. If the criteria for designation of these
instruments as hedging  transactions are not met, then the instruments  would be
marked to market,  with gains and losses  recognized in that period.  At July 1,
2001, and December 31, 2000,  Actel had no forward  foreign  exchange  contracts
outstanding  and  no  amounts  related  to  valuation  of  derivative  financial
instruments were included in other comprehensive income at either date.

     Actel limits the amount of forward foreign exchange  contract to the amount
sufficient to hedge forecasted Yen-based payments for a maximum of three months.
Actel does not use forward foreign exchange contracts for speculative or trading
purposes.  During the second  quarter of 2001,  Actel did not enter into or hold
any forward foreign exchange contracts.  During the first quarter of 2001, Actel
recognized  $15,000 in loss on the income  statement  related to forward foreign
exchange contracts. The forward contracts were perfectly effective as hedges and
offset gains of $15,000 on payments for Yen denominated  wafer purchases  during
the quarter.

3.   Equity Accounting

     During 1998,  Actel entered into a product  marketing rights agreement with
GateField Corporation (GateField) and made investments in GateField common stock
and GateField  convertible  preferred stock,  which were valued at cost.  During
1999,  Actel made additional  investments in GateField,  which resulted in Actel
accounting for its investments in GateField  under the equity method  commencing
July 1, 1999.

     On May 31, 2000,  GateField and Actel announced the signing of a definitive
agreement to merge.  On November 15, 2000,  the  acquisition  was  completed and
Actel paid cash  consideration of $5.25 for each share of GateField common stock
not already owned by Actel.  Equity  accounting was  discontinued as a result of
the acquisition on November 15, 2000.

4.   Inventories

     Inventories consist of the following:

                                                       July 1,       Dec. 31,
                                                         2001          2000
                                                     ------------  ------------
                                                           (in thousands)
Inventories:
   Purchased parts and raw materials.............    $      9,702  $      5,334
   Work-in-process...............................          19,533        11,443
   Finished goods................................           4,203         8,726
                                                     ------------  ------------
                                                     $     33,438  $     25,503
                                                     ============  ============

     Inventories are stated at the lower of cost (first-in, first-out) or market
(net  realizable  value).  Given the  volatility of the market for its products,
Actel makes inventory  provisions for potentially  excess and obsolete inventory
based on backlog and forecast demand. However, such backlog demand is subject to
revisions, cancellations, and rescheduling. Actual demand will inevitably differ
from such backlog and forecast  demand,  and such differences may be material to
the financial statements. Excess inventory increases handling costs and the risk
of  obsolescence,  is a  non-productive  use of  capital  resources,  and delays
realization of the price and performance  benefits associated with more advanced
manufacturing processes.

5.   Earnings Per Share

     The  following  table  sets  forth the  computation  of basic  and  diluted
earnings per share in accordance with SFAS No. 128, "Earnings per Share":

<TABLE>
<CAPTION>
                                                            Three Months Ended                  Six Months Ended
                                                 ----------------------------------------  --------------------------
                                                    Jul. 1,       Jul. 2,       Apr. 1,      Jul. 1,        Jul. 2,
                                                     2001          2000          2001         2001           2000
                                                 ------------  ------------  ------------  ------------  ------------
                                                               (in thousands, except per share amounts)
<S>                                              <C>           <C>           <C>           <C>           <C>
Basic:
Average common shares outstanding...........           23,642        23,263        23,472        23,557        23,015
Shares used in computing net income (loss)
   per shar ................................           23,642        23,263        23,472        23,557        23,015
                                                 ============  ============  ============  ============  ============
Net income (loss)...........................     $     (2,631) $     20,112  $      2,795  $        164  $     28,211
                                                 ============  ============  ============  ============  ============
Net income (loss) per share.................     $      (0.11) $       0.86  $       0.12  $       0.01  $       1.23
                                                 ============  ============  ============  ============  ============

Diluted:
Average common shares outstanding...........           23,642        23,263        23,472        23,557        23,015
Net effect of dilutive stock options - based
   on the treasury stock method.............               --         2,923         1,654         1,556         2,892
                                                 ------------  ------------  ------------  ------------  ------------
Shares used in computing net income (loss) per
   share....................................           23,642        26,186        25,126        25,113        25,907
                                                 ============  ============  ============  ============  ============
Net income (loss)...........................     $    (2,631)  $     20,112  $      2,795  $        164  $     28,211
                                                 ============  ============  ============  ============  ============
Net income (loss) per share.................     $     (0.11)  $       0.77  $       0.11  $       0.01  $       1.09
                                                 ============  ============  ============  ============  ============
</TABLE>

For the three-month  period ended July 1, 2001, 1.4 million shares issuable upon
the exercise of stock options were not included in the computation because their
inclusion would have been antidilutive.

6.   Comprehensive Income (Loss)

     The components of comprehensive income (loss), net of tax, are as follows:

<TABLE>
<CAPTION>
                                                            Three Months Ended                  Six Months Ended
                                                 ----------------------------------------  --------------------------
                                                    Jul. 1,       Jul. 2,       Apr. 1,      Jul. 1,        Jul. 2,
                                                     2001          2000          2001         2001           2000
                                                 ------------  ------------  ------------  ------------  ------------
<S>                                              <C>           <C>           <C>           <C>           <C>
Net Income/(Loss)...........................     $     (2,631) $     20,112  $      2,795  $        164  $     28,211

Unrealized gain/(loss) on available-for-sale
   securities...............................              179        (5,738)          275           455           777
Less reclassification adjustment for
   (gains)/losses included in net income....               --       (17,189)           --            --       (17,178)
                                                 ------------  ------------  ------------  ------------  ------------
Other Comprehensive Income/(Loss)...........              179       (22,927)          275           455       (16,401)
                                                 ------------  ------------  ------------  ------------  ------------
Total Comprehensive Income/(Loss)...........     $     (2,452) $     (2,815) $      3,070  $        619  $     11,810
                                                 ============  ============  ============  ============  ============
</TABLE>

Accumulated  other  comprehensive  income (loss)  presented in the  accompanying
consolidated condensed balance sheets consists of the accumulated net unrealized
gain (loss) on available-for-sale securities.

7.   Infringement Claims

     On March 29, 2000, Unisys  Corporation  (Unisys) brought suit in the United
States District Court for the Northern District of California, San Jose Division
(Court),  against Actel seeking  monetary  damages and  injunctive  relief.  The
summons and complaint  were served on Actel on April 10, 2000.  Actel and Unisys
orally  agreed to settle the case on April 25,  2001,  and executed a definitive
written settlement agreement on June 29, 2001. The Court dismissed the case with
prejudice on July 13, 2001. The  settlement was immaterial to Actel's  business,
financial condition, and operating results.

     As is typical in the semiconductor industry,  Actel has been and expects to
be notified from time to time of claims that it may be infringing  patents owned
by others.  During the past year, Actel has held discussions regarding potential
patent  infringement  issues.  As it has in the past,  Actel may obtain licenses
under  patents that it is alleged to  infringe.  When  probable  and  reasonably
estimable, Actel has made provision for the estimated settlement costs of claims
for alleged  infringement  prior to the balance sheet date. While Actel believes
that  reasonable  resolution  will occur,  there can be no assurance  that these
claims will be resolved or that the  resolution  of these claims will not have a
materially adverse effect on Actel's business,  financial condition,  or results
of operations.  In addition,  Actel's evaluation of the probable impact of these
pending  disputes  could  change  based upon new  information  learned by Actel.
Subject to the foregoing,  Actel does not believe that any pending  disputes are
likely to have a  materially  adverse  effect on  Actel's  financial  condition,
results  of  operations,  or  liquidity.  The  foregoing  is  a  forward-looking
statement  subject  to all of the risks  and  uncertainties  of  patent  claims,
including  the  discovery  of new  information  and  unpredictability  as to the
outcome of any proceeding.

8.   Recent Accounting Pronouncements

     In July 2001, the Financial Accounting Standards Board issued Statements of
Financial Accounting Standards (SFAS) No. 141, "Business Combinations," and SFAS
No.  142,  "Goodwill  and  Other  Intangible  Assets."  These  standards  become
effective  for fiscal years  beginning  after  December  15, 2001.  Beginning in
Actel's  2002  fiscal  year,  the first  quarter  of which  ends  April 7, 2002,
goodwill  will no longer be amortized  but will be subject to annual  impairment
tests.  All other  intangible  assets will  continue to be amortized  over their
estimated  useful  lives.  Actel is  currently  evaluating  the impact  that the
adoption of SFAS 141 and SFAS 142 will have on future  results of  operations or
financial position.


<PAGE>


Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations.

     All forward-looking  statements  contained in this Quarterly Report on Form
10-Q,  including  all  forward-looking  statements  contained  in  any  document
incorporated  herein  by  reference,  are  made  pursuant  to  the  safe  harbor
provisions of the Public Securities Litigation Reform Act of 1995. Words such as
"anticipates,"  "believes,"  "estimates," "expects," intends," "plans," "seeks,"
and  variations of such words and similar  expressions  are intended to identify
the forward-looking  statements. In addition, all forward-looking statements are
based on current  expectations and projections about the semiconductor  industry
and programmable  logic market,  and assumptions made by Actel's management that
reflect its best judgment based on other factors  currently known by management,
but they are not guarantees of future  performance.  Accordingly,  actual events
and  results  may differ  materially  from those  expressed  or  forecast in the
forward-looking  statements  due to the risk  factors  identified  herein or for
other reasons. Actel undertakes no obligation to update any statement, including
any  forward-looking  statement,  contained or incorporated by reference in this
Quarterly Report on Form 10-Q.

Results of Operations

     Net Revenues

     Net revenues were $36.5 million for the second  quarter of 2001, a decrease
of 19% from the first  quarter  of 2001 and of 34% from the  second  quarter  of
2000.  Quarterly  net revenues  declined  sequentially  due to a 17% decrease in
overall  unit  shipments  of field  programmable  gate  arrays  (FPGAs) and a 2%
decrease in the overall  average  selling  price (ASP) of FPGAs.  Quarterly  net
revenues  declined from a year ago due to a 34% decrease in unit shipments and a
1% decrease in ASP.

     Net revenues  were $81.5 million for the first six months of fiscal 2001, a
decrease of 23% from the first six months of fiscal 2000. Six-month net revenues
declined  from a year ago due to a 25%  decrease  in unit  shipments,  which was
offset in part by a 2% increase in ASP.

     Gross Margin

     Gross  margin was 51.8% of net  revenues  for the  second  quarter of 2001,
compared  with  62.5% for the  first  quarter  of 2001 and 62.3% for the  second
quarter of 2000. Gross margin was 57.7% of net revenues for the first six months
of 2001,  compared  with 62.2% of net revenues for the first six months of 2000.
The decline in gross margin was due to higher  inventory  reserves  taken in the
second  quarter  of 2001 as a  result  of  lower  customer  demand  and  reduced
manufacturing and operating efficiencies associated with lower net revenues.

     Actel seeks to improve gross margin by reducing costs. These cost reduction
activities  include  improving wafer yields,  negotiating  price reductions with
suppliers,  increasing  the level and  efficiency  of its testing and  packaging
operations,  achieving  economies of scale by means of higher production levels,
and increasing the number of die produced per wafer by shrinking the die size of
its products.  There can be no assurance  that these efforts will be successful.
The  ability  of Actel to shrink the die size of its FPGAs is  dependent  on the
availability of more advanced manufacturing  processes.  Due to the custom steps
involved in manufacturing  antifuse-based  FPGAs, Actel typically obtains access
to new  manufacturing  processes  later  than  its  competitors  using  standard
manufacturing processes.

     Research and Development (R&D)

     R&D expenditures were $9.1 million, or 25% of net revenues,  for the second
quarter of 2001,  compared  with $9.8 million,  or 22% of net revenues,  for the
first  quarter  of 2001 and $8.9  million,  or 16% of  revenues,  for the second
quarter of 2000.  The  sequential  reduction of $0.7 million in R&D spending was
the result of cost  reduction  activities  undertaken  by Actel in  response  to
declining net revenues.  These cost  reduction  activities  reductions  included
required time off for employees.

     R&D  expenditures  were $18.9  million,  or 23.2% of net revenues,  for the
first six months of 2001, compared with $17.2 million, or 16.2% of net revenues,
for the  first  six  months  of 2000.  R&D  spending  increased  from a year ago
primarily as a result of Actel's acquisitions of Prosys Technology (Prosys),  an
embedded  FPGA  intellectual  property  (IP)  developer,  in  June  2000  and of
GateField Corporation (GateField),  a developer of flash-based FPGA products, in
November 2000.

     During the second quarter,  Actel  announced a new corporate  initiative to
address   interoperability    problems   created   by   the   proliferation   of
high-performance  interface  standards.  Actel plans to increase R&D spending in
support of the  interface  initiative by $8.0 to $10.0 million over the next six
or seven  quarters,  after which R&D  spending as a  percentage  of sales should
return to levels more consistent with Actel's historical experience.

     Selling, General, and Administrative (SG&A)

     SG&A expenses were $10.3  million,  or 28% of net revenues,  for the second
quarter of 2001,  compared with $11.2 million,  or 25% of net revenues,  for the
first quarter of 2001 and $11.8 million, or 21% of net revenues,  for the second
quarter of 2000. SG&A expenses were $21.5 million,  or 26% of net revenues,  for
the first  six  months  of 2001,  compared  with  $23.4  million,  or 22% of net
revenues,  for the first  six  months of fiscal  2000.  SG&A  expenses  declined
primarily as a result of lower selling costs  associated with lower net revenues
and general cost reduction activities.

     Amortization  of Goodwill  and Other  Acquisition-Related  Intangibles  and
Expenses

     Amortization  of goodwill  and other  acquisition-related  intangibles  and
expenses was $3.7  million for the second  quarter of 2001,  compared  with $3.7
million for the first quarter of 2001 and $1.5 million for the second quarter of
2000.  Amortization  of goodwill and other  acquisition-related  intangibles was
$7.5  million for the first six months of 2001,  compared  with $2.6 million for
the first six months of 2000. The quarterly and six-month  increases from a year
ago were due to the effects of the Prosys  acquisition,  which  occurred late in
the second quarter of 2000, and the GateField acquisition, which occurred in the
middle of the fourth quarter of 2000.

     Interest Income and Other (Net)

     Interest income and other (net) were $2.0 million for the second quarter of
2001,  compared with $2.1 million for the first quarter of 2001 and $1.9 for the
second  quarter of 2000.  Interest  income and other (net) were $4.1 million for
the  first six  months of 2001,  compared  with $3.2  million  for the first six
months of 2000.  The  six-month  increase  from a year ago was due  primarily to
increased  cash,  cash  equivalents,  and short-term  investments  available for
investing by Actel,  as well as the  elimination  of losses booked on account of
Actel's equity investments in GateField.

     Tax Provision

     Actel's  effective  rate was 30% for the three  months  ended July 1, 2001,
compared with 30% for the first  quarter of 2001 and 32% for the second  quarter
of 2000. The decrease in the effective rate from a year ago was due primarily to
increased R&D credits and tax-exempt income as a percentage of projected pre-tax
book income.  Actel's  effective rate for the six months ended July 1, 2001, was
30%,  compared with 42% for the first six months of 2000. The effective tax rate
was  higher  a year  ago  due  to a  one-time  gain  on the  sale  of  Chartered
Semiconductor common stock by Actel in the second quarter of 2000. Excluding the
one-time  gain, the rate for the first six months of 2000 was 30%. The effective
tax rates are based on the estimated annual tax rate in compliance with SFAS No.
109, "Accounting for Income Taxes." This rate differs from the federal statutory
rate due primarily to state income taxes (net of federal benefit),  the benefits
of R&D credits and tax exempt income,  and the  recognition of certain  deferred
tax assets subject to valuation allowances as of December 31, 2000.

Liquidity and Capital Resources

     Actel's cash,  cash  equivalents,  and short-term  investments  were $133.9
million at the end of the second  quarter of 2001,  compared with $140.8 million
at the  beginning  of 2001.  The amount of cash and cash  equivalents  decreased
principally because of the growth in inventory.

     During  the first  six  months of 2001,  $4.7  million  of cash was used in
operating activities and $2.9 million of cash was used in investing  activities,
net of $4.1 million provided by net maturities of available-for-sale  securities
that were not re-invested and $4.7 million  purchases of property and equipment.
Financing  activities  provided cash of $4.0 million,  which was generated  from
sales of common stock under employee option and stock purchase plans.

     Actel has a line of credit with a bank that provides for  borrowings not to
exceed $5 million.  The  agreement  contains  covenants  that  require  Actel to
maintain  certain  financial ratios and levels of net worth. As of July 1, 2001,
Actel was in compliance  with the  covenants for the line of credit.  Borrowings
against the line of credit bear interest at the bank's prime rate. There were no
borrowings against the line of credit at July 1, 2001. The line of credit, which
expires in May 2002, may be terminated by either party upon not less than thirty
days' prior written notice.

     Actel  believes  that  existing  cash,  cash  equivalents,  and  short-term
investments,  together with cash from operations, will be sufficient to meet its
cash requirements for the next four quarters. A portion of available cash may be
used for investment in or acquisition of complementary businesses,  products, or
technologies.  Wafer manufacturers are increasingly  demanding financial support
from  customers in the form of equity  investments  and advance  purchase  price
deposits,  which can be substantial.  If Actel requires additional capacity,  it
may be required to incur significant expenditures to secure such capacity.

     Actel believes that the availability of adequate  financial  resources is a
substantial  competitive  factor.  To take  advantage of  opportunities  as they
arise,  or to withstand  adverse  business  conditions  when they occur,  it may
become prudent or necessary for Actel to raise additional capital. Actel intends
to continue monitoring the availability and cost of potential capital resources,
including equity,  debt, and off-balance sheet financing  arrangements,  and may
consider raising additional capital on terms that are acceptable to Actel. There
can be no assurance that additional  capital will become available on acceptable
terms.

Other Factors Affecting Future Operating Results

     Actel's operating results are subject to general economic  conditions and a
variety of risks characteristic of the semiconductor industry (including booking
and shipment  uncertainties,  wafer supply  fluctuations,  and price erosion) or
specific to Actel, any of which could cause Actel's  operating results to differ
materially from past results. For a discussion of such risks, see "Risk Factors"
in Part I of Actel's Annual Report on Form 10-K for 2000,  which is incorporated
herein by this reference.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

     As of July 1, 2001, Actel's  investment  portfolio  consisted  primarily of
corporate bonds, floating rate notes, and federal and municipal obligations. The
principal objectives of Actel's investment activities are to preserve principal,
meet liquidity  needs,  and maximize  yields.  To meet these  objectives,  Actel
invests only in high credit quality debt securities  with average  maturities of
less than two years.  Actel also limits the percentage of total investments that
may be  invested in any one issuer.  Corporate  investments  as a group are also
limited to a maximum percentage of Actel's investment portfolio.

     Actel is exposed to financial market risks,  including  changes in interest
rates,  foreign currency  exchange rates, and marketable equity security prices.
All of the  potential  changes noted below are based upon  sensitivity  analysis
performed on Actel's financial position and expected operating levels at July 1,
2001. Actual results may differ materially.

     Actel's  investments  are  subject to  interest  rate risk.  An increase in
interest  rates  could  subject  Actel to a decline in the  market  value of its
investments.  These  risks are  mitigated  by the ability of Actel to hold these
investments  to maturity.  A  hypothetical  100 basis point increase in interest
rates would  result in a reduction  of  approximately  $1.9  million in the fair
value of Actel's available-for-sale securities held at July 1, 2001.

     Actel purchases a portion of the wafers it uses in production from Japanese
suppliers,  which are  denominated  in Japanese  Yen.  An adverse  change in the
foreign  exchange  rate would  affect the price  Actel pays for a portion of the
wafers used in  production  over the long term.  Actel  attempts to mitigate its
exposure to risks from  foreign  currency  fluctuations  by  purchasing  forward
foreign  exchange  contracts to hedge firm purchase  commitments  denominated in
foreign  currencies.  Forward exchange contracts are short term and do not hedge
purchases that will be made for anticipated  longer-term wafer needs. An adverse
change of 10% in exchange  rates would  result in a reduction  in income  before
taxes of  approximately  $1.5 million based on projected Yen  denominated  wafer
purchases for the next year.

     Actel's  strategic  investments in marketable equity securities are subject
to equity price risks.  Actel  typically does not attempt to reduce or eliminate
market  exposure on these  securities.  Assuming a 10% adverse  change,  Actel's
marketable  strategic equity securities would decrease in value by approximately
$0.6 million, based on the value of the portfolio as of July 1, 2001.

Additional Quarterly Information

     The following table presents certain  unaudited  quarterly results for each
of the eight  quarters  in the  period  ended July 1,  2001.  In the  opinion of
management,  all  necessary  adjustments  (consisting  only of normal  recurring
accruals)  have been included in the amounts  stated below to present fairly the
unaudited   quarterly   results  when  read  in  conjunction  with  the  audited
consolidated financial statements of Actel and notes thereto included in Actel's
Annual Report on Form 10-K for the year ended December 31, 2001. These quarterly
operating  results are not necessarily  indicative of the results for any future
period.



<PAGE>
<TABLE>
<CAPTION>

                                                                              Three Months Ended
                                           --------------------------------------------------------------------------------------
                                            Jul. 1,     Apr. 1,   Dec. 31,    Oct. 1,    Jul. 2,    Apr. 2,    Jan. 2,    Oct. 3,
                                             2001        2001       2000       2000       2000       2000       2000       1999
                                           ========    ========   ========   ========   ========   ========   ========   ========
                                                                   (in thousands, except per share amounts)
<S>                                        <C>         <C>        <C>        <C>        <C>        <C>        <C>        <C>
Statements of Operations Data:
Net revenues ...........................   $ 36,460    $ 45,034   $ 60,129   $ 60,080   $ 55,544   $ 50,666   $ 46,042   $ 43,162
Gross profit ...........................     18,888      28,160     38,060     37,626     34,595     31,458     28,546     26,503
Income (loss) from operations ..........     (4,233)      3,463      7,497     13,648      6,778     10,555      7,175      7,492
Net income (loss) ......................   $ (2,631)   $  2,795   $  3,455   $  9,779   $ 20,112   $  8,099   $  5,823   $  5,668
Net income (loss) per share:
   Basic ...............................   $  (0.11)   $   0.12   $   0.14   $   0.41   $   0.86   $   0.36   $   0.26   $   0.26
                                           ========    ========   ========   ========   ========   ========   ========   ========
   Diluted .............................   $  (0.11)   $   0.11   $   0.13   $   0.36   $   0.77   $   0.32   $   0.24   $   0.25
                                           ========    ========   ========   ========   ========   ========   ========   ========

Shares used in computing net income
  (loss) per share:
   Basic ...............................     23,642      23,472     23,890     23,869     23,263     22,767     22,048     21,748
                                           ========    ========   ========   ========   ========   ========   ========   ========
   Diluted .............................     23,642      25,126     26,107     26,999     26,186     25,467     24,015     23,003
                                           ========    ========   ========   ========   ========   ========   ========   ========
</TABLE>
<TABLE>
<CAPTION>

                                                                              Three Months Ended
                                           --------------------------------------------------------------------------------------
                                            Jul. 1,     Apr. 1,   Dec. 31,    Oct. 1,    Jul. 2,    Apr. 2,    Jan. 2,    Oct. 3,
                                             2001        2001       2000       2000       2000       2000       2000       1999
                                           ========    ========   ========   ========   ========   ========   ========   ========
                                                                   (in thousands, except per share amounts)
<S>                                        <C>         <C>        <C>        <C>        <C>        <C>        <C>        <C>
As a Percentage of Net Revenues:
Net revenues...............................  100.0%      100.0%     100.0%     100.0%     100.0%     100.0%     100.0%     100.0%
Gross profit...............................   51.8        62.5       63.3       62.6       62.3       62.1       62.0       61.4
Income (loss) from operations..............  (11.6)        7.7       12.5       22.7       12.2       20.8       15.6       17.4
Net income (loss) .........................   (7.2)        6.2        5.7       16.3       36.2       16.0       12.6       13.1
</TABLE>

<PAGE>

                          PART II -- OTHER INFORMATION


Item 1. Legal Proceedings

     On March 29, 2000, Unisys  Corporation  (Unisys) brought suit in the United
States District Court for the Northern District of California, San Jose Division
(Court),  against Actel seeking  monetary  damages and  injunctive  relief.  The
summons and complaint  were served on Actel on April 10, 2000.  Actel and Unisys
orally  agreed to settle the case on April 25,  2001,  and executed a definitive
written settlement agreement on June 29, 2001. The Court dismissed the case with
prejudice on July 13, 2001. The  settlement was immaterial to Actel's  business,
financial condition, and operating results.

     Currently,  there are no pending legal  proceedings of a material nature to
which Actel is a party or of which any of its property is the subject. There are
no such legal  proceedings known by Actel to be contemplated by any governmental
authority.

     As is typical in the semiconductor industry,  Actel has been and expects to
be notified from time to time of claims that it may be infringing  patents owned
by others.  During the past year, Actel has held discussions regarding potential
patent  infringement  issues.  As it has in the past,  Actel may obtain licenses
under  patents that it is alleged to  infringe.  When  probable  and  reasonably
estimable, Actel has made provision for the estimated settlement costs of claims
for alleged  infringement  prior to the balance sheet date. While Actel believes
that  reasonable  resolution  will occur,  there can be no assurance  that these
claims will be resolved or that the  resolution  of these claims will not have a
materially adverse effect on Actel's business,  financial condition,  or results
of operations.  In addition,  Actel's evaluation of the probable impact of these
pending  disputes  could  change  based upon new  information  learned by Actel.
Subject to the foregoing,  Actel does not believe that any pending  disputes are
likely to have a  materially  adverse  effect on  Actel's  financial  condition,
results  of  operations,  or  liquidity.  The  foregoing  is  a  forward-looking
statement  subject  to all of the risks  and  uncertainties  of  patent  claims,
including  the  discovery  of new  information  and  unpredictability  as to the
outcome of any proceeding.


<PAGE>


Item 4. Submission of Matters to a Vote of Security Holders

     The Annual  Meeting of  Shareholders  of Actel was held on May 18, 2001. At
the Annual Meeting,  Actel shareholders (i) elected directors to serve until the
next Annual Meeting of Shareholders and until their successors are elected; (ii)
approved  Actel's  1986  Incentive  Stock Option Plan as amended and restated to
prohibit stock option repricings and cancellation/replacement awards that result
in variable award  accounting,  prohibit the granting of any option at less than
fair  market  value,  and extend the term of the Plan until May 2011;  and (iii)
ratified the  appointment of Ernst & Young LLP as Actel's  independent  auditors
for the fiscal year ending January 6, 2002.

     The vote for nominated directors was as follows:

<TABLE>
<CAPTION>
                Nominee                                   For                                 Withheld
-------------------------------------   -------------------------------------   -------------------------------------
<S>                                                   <C>                                     <C>
John C. East.........................                 17,246,221                              2,273,874
James R. Fiebiger....................                 19,394,379                               125,716
Jos C. Henkens.......................                 14,476,592                              5,043,503
Jacob S. Jacobsson...................                 19,394,179                               125,916
Frederic N. Schwettmann..............                 19,394,079                               126,016
Robert G. Spencer....................                 19,394,379                               125,716
</TABLE>

     The vote on approval of Actel's 1986 Incentive Stock Option Plan as amended
and restated was as follows:

<TABLE>
<CAPTION>
                  For                                   Against                                Abstain
-------------------------------------   -------------------------------------   -------------------------------------
<S>           <C>                                      <C>                                     <C>
              15,042,882                               4,456,294                               20,919
</TABLE>

     The vote on  ratification  of the  appointment  of Ernst & Young LLP was as
follows:

<TABLE>
<CAPTION>
                  For                                   Against                                Abstain
-------------------------------------   -------------------------------------   -------------------------------------
<S>           <C>                                       <C>                                     <C>
              19,383,983                                126,230                                 9,882
</TABLE>

<PAGE>


Item 6. Exhibits and Reports on Form 8-K


(a)  Exhibits

    Exhibit Number                                  Description
----------------------   -------------------------------------------------------
        10.1*            Form of Management Continuity Agreement, as amended and
                         restated.

     *This Exhibit is a management contract or compensatory plan or arrangement.

(b)  Reports on Form 8-K

     None.


                                    SIGNATURE

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.




                                                     ACTEL CORPORATION




     Date: August 13, 2001                         /s/ Henry L. Perret
                                           -------------------------------------
                                                      Henry L. Perret
                                                 Vice President of Finance
                                                and Chief Financial Officer
                                              (as principal financial officer
                                               and on behalf of Registrant)

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-1
<SEQUENCE>3
<FILENAME>exhibit.txt
<DESCRIPTION>EXHIBIT 10.1 MANAGEMENT CONTINUITY AGREEMENT
<TEXT>

                                ACTEL CORPORATION

                         MANAGEMENT CONTINUITY AGREEMENT



         This Management Continuity Agreement (the "Agreement") is made and
entered into by and between _____________________ (the "Employee") and Actel
Corporation, a California corporation (the "Company"), effective as of
_________________, _______ (the "Effective Date").

                                 R E C I T A L S

     A.   It is expected  that the Company  from time to time will  consider the
          possibility of an acquisition by or of another company or other change
          of  control.  The Board of  Directors  of the  Company  (the  "Board")
          recognizes  that  such  consideration  can  be a  distraction  to  the
          Employee and can cause the Employee to consider alternative employment
          opportunities.  The  Board  has  determined  that  it is in  the  best
          interests  of the  Company  and its  shareholders  to assure  that the
          Company will have the  continued  dedication  and  objectivity  of the
          Employee,  notwithstanding the possibility,  threat or occurrence of a
          Change of Control (as defined below) of the Company.

     B.   The Board believes that it is in the best interests of the Company and
          its shareholders to provide the Employee with an incentive to continue
          employment  and to motivate  the Employee to maximize the value of the
          Company upon a Change of Control for the benefit of its shareholders.

     C.   The Board  believes that it is imperative to provide the Employee with
          certain severance  benefits upon Employee's  termination of employment
          following a Change of Control that provides the Employee with enhanced
          financial  security and provides  incentive and  encouragement  to the
          Employee to remain with the Company notwithstanding the possibility or
          occurrence of a Change of Control.

     D.   Certain capitalized terms used in the Agreement are defined in Section
          4 below.

         The parties hereto agree as follows:

     1.   Term of Agreement.  This Agreement  shall terminate upon the date that
          all  obligations  of the parties hereto with respect to this Agreement
          have been satisfied.

     2.   At-Will Employment.  The Company and the Employee acknowledge that the
          Employee's  employment is and shall continue to be at-will, as defined
          under applicable law. If the Employee's  employment terminates for any
          reason,  including  (without  limitation) any  termination  prior to a
          Change of Control, the Employee shall not be entitled to any payments,
          benefits,  damages,  awards, or compensation other than as provided by
          this Agreement or as may otherwise be available in accordance with the
          Company's  established  employee  plans and  practices  or pursuant to
          other agreements with the Company.

     3.   Severance Benefits

          (a)  Termination   Following  A  Change  of  Control.   If  Employee's
               employment  with  the  Company  terminates  as  a  result  of  an
               Involuntary  Termination other than for Cause, or such Employee's
               employment is terminated due to the death of the Employee, at any
               time following a Change of Control when Employee's  options under
               the  Company's  stock  option plans that were not fully vested on
               the date of the Change of Control (the  "Unvested  Options") have
               not yet fully vested (the "Protection Period"),  then, subject to
               Section 4, one hundred  percent  (100%) of the  Unvested  Options
               held by the  Employee  shall  automatically  and  immediately  be
               accelerated  in full so as to become  completely  vested  and the
               Employee may exercise any option under the Company's stock option
               plans that was not fully  exercised  on the date of the Change of
               Control at any time  within  twelve  (12)  months  following  the
               Termination  Date (but in no event later than the  expiration  of
               the term of the option).

          (b)  Voluntary  Resignation;  Termination For Cause. If the Employee's
               employment  terminates  by  reason  of the  Employee's  voluntary
               resignation  (and is not an Involuntary  Termination),  or if the
               Employee is terminated for Cause,  then the Employee shall not be
               entitled to receive  severance or other benefits except for those
               (if any) as may then be  established  under  the  Company's  then
               existing  severance and benefits  plans and practices or pursuant
               to other agreements with the Company.

          (c)  Disability.  If the Company terminates the Employee's  employment
               as a result of the Employee's Disability, then the Employee shall
               not be entitled to receive severance or other benefits except for
               those (if any) as may then be  established  under  the  Company's
               then  existing  severance  and  benefits  plans and  practices or
               pursuant to other agreements with the Company.

          (d)  Termination  Apart  from  Change  of  Control.  In the  event the
               Employee's  employment is terminated for any reason, either prior
               to the  occurrence of a Change of Control or after the Protection
               Period,  then the Employee shall be entitled to receive severance
               and any other benefits only as may then be established  under the
               Company's  existing severance and benefits plans and practices or
               pursuant to other agreements with the Company.

          4.   Attorney  Fees,  Costs and Expenses.  The Company shall  promptly
               reimburse  Employee,  on a  monthly  basis,  for  the  reasonable
               attorney  fees,  costs and  expenses  incurred by the Employee in
               connection  with any action  brought by  Employee  to enforce his
               rights hereunder, regardless of the outcome of the action.

          5.   Limitation on Payments.  In the event that the severance benefits
               provided  for in  this  Agreement  or  otherwise  payable  to the
               Employee (i) constitute  "parachute  payments" within the meaning
               of Section 280G of the Internal  Revenue Code of 1986, as amended
               (the "Code") and (ii) but for this Section 5, would be subject to
               the excise tax  imposed  by  Section  4999 of the Code,  then the
               Employee's severance benefits under Section 3(a) shall be either

               (a)  delivered in full, or

               (b)  delivered as to such lesser  extent which would result in no
                    portion of such  severance  benefits being subject to excise
                    tax under Section 4999 of the Code,

               whichever  of the  foregoing  amounts,  taking  into  account the
               applicable federal,  state, and local income taxes and the excise
               tax  imposed  by  Section  4999,  results  in the  receipt by the
               Employee  on an  after-tax  basis,  of  the  greatest  amount  of
               severance benefits,  notwithstanding  that all or some portion of
               such severance  benefits may be taxable under Section 4999 of the
               Code.  Unless the Company  and the  Employee  otherwise  agree in
               writing, any determination required under this Section 5 shall be
               made in writing by the Company's  independent  public accountants
               immediately prior to Change of Control (the "Accountants"), whose
               determination  shall be conclusive  and binding upon the Employee
               and the  Company  for all  purposes.  For  purposes of making the
               calculations required by this Section 5, the Accountants may make
               reasonable  assumptions and approximations  concerning applicable
               taxes  and may rely on  reasonable,  good  faith  interpretations
               concerning the application of Sections 280G and 4999 of the Code.
               The Company and the  Employee  shall  furnish to the  Accountants
               such  information and documents as the Accountants may reasonably
               request in order to make a determination under this Section.  The
               Company shall bear all costs the Accountants may reasonably incur
               in connection with any calculations  contemplated by this Section
               5.

          6.   Definition  of Terms.  The  following  terms  referred to in this
               Agreement shall have the following meanings:

               (a)  Cause. "Cause" shall mean (i) any act of personal dishonesty
                    taken   by   the   Employee   in    connection    with   his
                    responsibilities  as an employee  and  intended to result in
                    substantial  personal  enrichment of the Employee,  (ii) the
                    conviction of a felony,  (iii) a willful act by the Employee
                    which constitutes gross misconduct and which is injurious to
                    the Company,  and (iv) following delivery to the Employee of
                    a written  demand for  performance  from the  Company  which
                    describes  the  basis  for the  Company's  belief  that  the
                    Employee  has  not   substantially   performed  his  duties,
                    continued  violations  by the  Employee  of  the  Employee's
                    obligations  to the Company which are  demonstrably  willful
                    and deliberate on the Employee's part.

               (b)  Change of Control.  "Change of Control" means the occurrence
                    of any of the following  events after the Effective Date:

                    (i)  Any  "person"  (as such term is used in Sections  13(d)
                         and 14(d) of the  Securities  Exchange Act of 1934,  as
                         amended)  is or  becomes  the  "beneficial  owner"  (as
                         defined in Rule 13d-3  under  said  Act),  directly  or
                         indirectly,  of securities of the Company  representing
                         50% or more of the total  voting power  represented  by
                         the Company's then outstanding voting securities; or

                    (ii) A change  in the  composition  of the  Board  occurring
                         within a two-year  period,  as a result of which  fewer
                         than  a  majority  of  the   directors   are  Incumbent
                         Directors.  "Incumbent  Directors" shall mean directors
                         who either (A) are  directors  of the Company as of the
                         date  hereof,  or (B) are  elected,  or  nominated  for
                         election, to the Board with the affirmative votes of at
                         least a majority of the Incumbent Directors at the time
                         of such election or  nomination  (but shall not include
                         an  individual  whose  election  or  nomination  is  in
                         connection  with an actual or threatened  proxy contest
                         relating to the election of directors to the Company);

                    (iii)The  shareholders  of the  Company  approve a merger or
                         consolidation   of   the   Company   with   any   other
                         corporation; or

                    (iv) The  shareholders  of the  Company  approve  a plan  of
                         complete liquidation of the Company or an agreement for
                         the  sale  or  disposition  by  the  Company  of all or
                         substantially all the Company's assets.

               (c)  Disability.  "Disability"  shall mean that the  Employee has
                    been unable to perform  his Company  duties as the result of
                    his incapacity due to physical or mental  illness,  and such
                    inability,  at least 26 weeks  after  its  commencement,  is
                    determined to be total and permanent by a physician selected
                    by  the  Company  or  its  insurers  and  acceptable  to the
                    Employee  or  the  Employee's  legal   representative  (such
                    Agreement  as  to  acceptability   not  to  be  unreasonably
                    withheld). Termination resulting from Disability may only be
                    effected  after  at least 30  days'  written  notice  by the
                    Company  of  its  intention  to  terminate  the   Employee's
                    employment.  In the  event  that the  Employee  resumes  the
                    performance  of  substantially  all of his duties  hereunder
                    before the termination of his employment  becomes effective,
                    the notice of intent to  terminate  shall  automatically  be
                    deemed to have been revoked.

               (d)  Involuntary  Termination.  "Involuntary  Termination"  shall
                    mean (i) without the Employee's  express written consent,  a
                    significant reduction in the Employee's duties, authority or
                    responsibilities,   relative  to  the   Employee's   duties,
                    authority,  or  responsibilities  as in  effect  immediately
                    prior to such  reduction,  or the  assignment to Employee of
                    such reduced duties,  authority,  or responsibilities;  (ii)
                    without  the   Employee's   express   written   consent,   a
                    substantial reduction, without good business reasons, in the
                    facilities  and  perquisites  (including  office  space  and
                    location)  available  to the Employee  immediately  prior to
                    such reduction; (iii) a reduction by the Company in the base
                    salary of the  Employee  as in effect  immediately  prior to
                    such reduction;  (iv) a material reduction by the Company in
                    the kind or level of employee  benefits,  including bonuses,
                    to which the Employee was entitled immediately prior to such
                    reduction  with  the  result  that  the  Employee's  overall
                    benefits   package  is   significantly   reduced;   (v)  the
                    relocation  of the Employee to a facility or a location more
                    than  thirty  (30) miles from the  Employee's  then  present
                    location,  without the Employee's  express written  consent;
                    (vi)  any  purported  termination  of  the  Employee  by the
                    Company  which is not effected for  Disability or for Cause,
                    or any purported  termination  for which the grounds  relied
                    upon are not  valid;  (vii) the  failure  of the  Company to
                    obtain the  assumption of this  agreement by any  successors
                    contemplated in Section 7(a) below; or (viii) any act or set
                    of facts or circumstances which would, under California case
                    law or statute, constitute a constructive termination of the
                    Employee.

               (e)  Termination Date.  "Termination Date" shall mean (i) if this
                    Agreement  is  terminated  by the  Company  for  Disability,
                    thirty (30) days after notice of termination is given to the
                    Employee (provided that the Employee shall not have returned
                    to the  performance of the Employee's  duties on a full-time
                    basis  during  such  thirty  (30)-day  period),  (ii) if the
                    Employee's  employment  is terminated by the Company for any
                    other reason,  the date on which a notice of  termination is
                    given,  provided  that if within  thirty (30) days after the
                    Company  gives  the  Employee  notice  of  termination,  the
                    Employee   notifies  the  Company  that  a  dispute   exists
                    concerning  the  termination or the benefits due pursuant to
                    this Agreement,  then the Termination Date shall be the date
                    on which  such  dispute  is  finally  determined,  either by
                    mutual  written  agreement  of the  parties,  or a by  final
                    judgment,   order,   or  decree  of  a  court  of  competent
                    jurisdiction  (the time for appeal  therefrom having expired
                    and no  appeal  having  been  perfected),  or  (iii)  if the
                    Agreement is terminated  by the Employee,  the date on which
                    the  Employee  delivers  the  notice of  termination  to the
                    Company.

          7.   Successors

               (a)  Company's Successors.  Any successor to the Company (whether
                    direct  or  indirect  and  whether  by   purchase,   merger,
                    consolidation,   liquidation,   or   otherwise)  to  all  or
                    substantially  all of the Company's  business  and/or assets
                    shall assume the obligations  under this Agreement and agree
                    expressly to perform the obligations under this Agreement in
                    the same manner and to the same extent as the Company  would
                    be required to perform such  obligations in the absence of a
                    succession.  For all purposes under this Agreement, the term
                    "Company"  shall  include  any  successor  to the  Company's
                    business  and/or  assets  which  executes  and  delivers the
                    assumption agreement described in this Section 7(a) or which
                    becomes bound by the terms of this Agreement by operation of
                    law.

               (b)  Employee's  Successors.  The terms of this Agreement and all
                    rights of the Employee  hereunder shall inure to the benefit
                    of, and be enforceable by, the Employee's  personal or legal
                    representatives,   executors,  administrators,   successors,
                    heirs, distributees, devisees, and legatees.

          8.   Notice

               (a)  General.  Notices and all other communications  contemplated
                    by this Agreement shall be in writing and shall be deemed to
                    have been  duly  given  when  personally  delivered  or when
                    mailed by U.S.  registered or certified mail, return receipt
                    requested and postage prepaid.  In the case of the Employee,
                    mailed notices shall be addressed to him at the home address
                    which  he  most  recently  communicated  to the  Company  in
                    writing. In the case of the Company, mailed notices shall be
                    addressed  to its  corporate  headquarters,  and all notices
                    shall be directed to the attention of its Secretary.

               (b)  Notice of  Termination.  Any  termination by the Company for
                    Cause  or  by  the  Employee  as a  result  of  a  voluntary
                    resignation   or  an   Involuntary   Termination   shall  be
                    communicated  by a notice of  termination to the other party
                    hereto  given  in  accordance  with  Section  8(a)  of  this
                    Agreement.   Such  notice   shall   indicate   the  specific
                    termination  provision in this Agreement  relied upon, shall
                    set forth in reasonable  detail the facts and  circumstances
                    claimed  to  provide  a  basis  for  termination  under  the
                    provision so indicated,  and shall  specify the  termination
                    date (which  shall be not more than 30 days after the giving
                    of such  notice).  The failure by the Employee to include in
                    the notice any fact or circumstance  which  contributes to a
                    showing of Involuntary Termination shall not waive any right
                    of the Employee  hereunder  or preclude  the  Employee  from
                    asserting such fact or  circumstance in enforcing his rights
                    hereunder.

          9.   Miscellaneous Provisions

               (a)  No Duty to Mitigate.  The Employee  shall not be required to
                    mitigate  the  amount of any  benefit  contemplated  by this
                    Agreement,  nor shall any such  benefit  be  reduced  by any
                    earnings  that the  Employee  may  receive  from  any  other
                    source.

               (b)  Waiver.  No provision of this  Agreement  shall be modified,
                    waived, or discharged  unless the  modification,  waiver, or
                    discharge is agreed to in writing and signed by the Employee
                    and by an authorized  officer of the Company (other than the
                    Employee). No waiver by either party of any breach of, or of
                    compliance   with,   any  condition  or  provision  of  this
                    Agreement by the other party shall be considered a waiver of
                    any other condition or provision or of the same condition or
                    provision at another time.

               (c)  Whole   Agreement.   No  agreements,   representations,   or
                    understandings  (whether oral or written and whether express
                    or  implied)  which  are not  expressly  set  forth  in this
                    Agreement  have been made or  entered  into by either  party
                    with respect to the subject  matter  hereof.  This Agreement
                    shall  take  precedence  over any other  documents  that may
                    conflict with this Agreement.

               (d)  Choice of Law. The validity,  interpretation,  construction,
                    and  performance of this Agreement  shall be governed by the
                    laws of the State of California.

               (e)  Severability.  The  invalidity  or  unenforceability  of any
                    provision or provisions of this  Agreement  shall not affect
                    the  validity  or  enforceability  of  any  other  provision
                    hereof, which shall remain in full force and effect.

               (f)  Counterparts.    This   Agreement   may   be   executed   in
                    counterparts, each of which shall be deemed an original, but
                    all of  which  together  will  constitute  one and the  same
                    instrument.

     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the
case of the Company by its duly authorized officer, as of the Effective Date.



        ACTEL CORPORATION                                  EMPLOYEE





By:
   -----------------------------------       -----------------------------------
            John C. East                                  (Signature)
   President & Chief Executive Officer

</TEXT>
</DOCUMENT>
</SUBMISSION>
