<SUBMISSION>
<ACCESSION-NUMBER>0000950134-02-013188
<TYPE>10-Q
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20020731
<FILING-DATE>20021031
<FILER>
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<CONFORMED-NAME>3DFX INTERACTIVE INC
<CIK>0001010026
<ASSIGNED-SIC>7372
<IRS-NUMBER>770390421
<STATE-OF-INCORPORATION>CA
<FISCAL-YEAR-END>0201
</COMPANY-DATA>
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<FORM-TYPE>10-Q
<ACT>34
<FILE-NUMBER>000-22651
<FILM-NUMBER>02805326
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>4435 FORTRAN DR
<CITY>SAN JOSE
<STATE>CA
<ZIP>95134
<PHONE>4085913508
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<CITY>SAN JOSE
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<TYPE>10-Q
<SEQUENCE>1
<FILENAME>d00805e10vq.txt
<DESCRIPTION>FORM 10-Q
<TEXT>
<PAGE>

                                  United States
                       Securities and Exchange Commission

                             Washington, D.C. 20549

                                    FORM 10-Q

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Period Ended July 31, 2002.

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Transition Period from __________ to __________.

                         Commission file number 0-22651

                                   ----------

                             3DFX INTERACTIVE, INC.
             (Exact name of registrant as specified in its charter)

                                   ----------

               CALIFORNIA                                 77-0390421
               ----------                                 ----------
   (State or Other Jurisdiction of             (IRS Employer Identification No.)
    Incorporation or Organization)


                                 P.O. BOX 60486
                           PALO ALTO, CALIFORNIA 94306

                                   ----------

               (Address of Principal Executive Office) (Zip Code)

                         TELEPHONE NUMBER (650) 326-7995

                                   ----------

              (Registrant's telephone number, including area code)

                                   ----------

              (Former name, former address and former fiscal year,
                          if changed since last report)

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

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 periods 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 [ ]

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

Common Stock, No Par Value -- 39,774,364 shares as of October 25, 2002

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



<PAGE>
                             3dfx Interactive, Inc.

                                      Index

<Table>
<Caption>
                                                                                                                       Page
<S>                                                                                                                    <C>
PART I        FINANCIAL INFORMATION.......................................................................................1


              ITEM 1.     FINANCIAL STATEMENTS (UNAUDITED)


                          CONSOLIDATED STATEMENTS OF NET LIABILITIES IN LIQUIDATION AT JULY 31, 2002, AND
                          JANUARY 31, 2002................................................................................1


                          CONSOLIDATED STATEMENTS OF CHANGES IN NET LIABILITIES IN LIQUIDATION FOR THE
                          THREE AND SIX MONTHS ENDED JULY 31, 2002, AND FOR THE PERIOD FROM MARCH 27,
                          2001 TO JULY 31, 2001...........................................................................2


                          CONDENSED CONSOLIDATED STATEMENT OF DISCONTINUED OPERATIONS FOR THE PERIOD FROM
                          FEBRUARY 1, 2001 TO MARCH 26, 2001..............................................................3


                          CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS OF DISCONTINUED OPERATIONS FOR
                          THE PERIOD FROM FEBRUARY 1, 2001 TO MARCH 26, 2001..............................................4


                          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS............................................5


              ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                          DISCONTINUED OPERATIONS........................................................................11


              ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK......................................19


PART II - OTHER INFORMATION..............................................................................................20


              ITEM 1.     LEGAL PROCEEDINGS..............................................................................20


              ITEM 2.     CHANGES IN SECURITIES AND USE OF PROCEEDS......................................................21


              ITEM 3.     DEFAULTS UPON SENIOR SECURITIES................................................................21


              ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS............................................21


              ITEM 5.     OTHER INFORMATION..............................................................................21


              ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K...............................................................22
</Table>



                                        i
<PAGE>

PART I FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS

                     3dfx INTERACTIVE, INC. AND SUBSIDIARIES
            CONSOLIDATED STATEMENTS OF NET LIABILITIES IN LIQUIDATION
                                 (In thousands)
                                   (Unaudited)


<Table>
<Caption>
Assets
                                                            July 31,     January 31,
                                                              2002           2002
                                                          ------------   ------------
<S>                                                       <C>            <C>
  Cash and cash equivalents                               $         80   $      1,090
  Other current assets                                              26            404
  Contingent receivable (Note 1)
                                                          ------------   ------------
    Total assets                                          $        106   $      1,494
                                                          ============   ============



Liabilities


  Accounts payable                                        $     25,188   $     23,632
  Estimated costs during period of liquidation (Note 1)         10,154         12,264
  Commitments and contingencies (Note 5)
                                                          ------------   ------------

    Total liabilities                                     $     35,342   $     35,896

                                                          ------------   ------------
    Net liabilities in liquidation                        $     35,236   $     34,402
                                                          ============   ============
</Table>



The accompanying notes are an integral part of these financial statements.



                                       1
<PAGE>
                             3DFX INTERACTIVE, INC.
      CONSOLIDATED STATEMENTS OF CHANGES IN NET LIABILITIES IN LIQUIDATION
                                 (In thousands)
                                   (Unaudited)


<Table>
<Caption>
                                                          Three and Six months ended
                                                                 July 31, 2002
                                                          --------------------------
<S>                                                       <C>
Net liabilities in liquidation at February 1, 2002 ....                      (34,402)

   Selling, general and administrative expenses .......                         (269)
                                                                             -------
Net liabilities in liquidation at April 30, 2002 ......                      (34,671)

   Selling, general and administrative expenses .......                         (658)
   Other ..............................................                           93
                                                                             -------
Net liabilities in liquidation at July 31, 2002 .......                      (35,236)
                                                                             =======
</Table>

<Table>
<Caption>
                                                           For the Period from
                                                            March 27, 2001 to
                                                              July 31, 2001
                                                           -------------------
<S>                                                        <C>
Net assets in liquidation at March 27, 2001 ...........               $ 20,457

   Selling, general and administrative expenses .......                 (3,901)
   Net gain on sale of assets held for sale ...........                  3,227
   Decrease in deferred tax asset .....................                (35,000)

Net liabilities in liquidation at April 30, 2001 ......                (15,217)
                                                                      --------

   Selling, general and administrative expenses .......                 (5,929)
   Net loss on sale of assets held for sale ...........                   (948)
                                                                      --------
Net Liabilities in Liquidation at July 31, 2001 .......               $(22,094)
                                                                      ========
</Table>



The accompanying notes are an integral part of these financial statements.



                                       2
<PAGE>

                     3DFX INTERACTIVE, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENT OF DISCONTINUED OPERATIONS
                      (In thousands, except per share data)
                                   (Unaudited)


<Table>
<Caption>
                                                                             For the period from
                                                                             February 1, 2001 to
                                                                               March 26, 2001
                                                                             -------------------
<S>                                                                          <C>
Operating expenses:
    Selling, general and administrative                                      $             7,801
                                                                             -------------------
Total operating expenses                                                                   7,801
                                                                             -------------------
Loss from discontinued operations                                                         (7,801)
Other income (expense), net                                                                  182
                                                                             -------------------
Loss from discontinued operations before income taxes                                     (7,619)
Provision (benefit) for income taxes
                                                                                          (4,992)
                                                                             -------------------
Net loss from discontinued operations                                        $            (2,627)
                                                                             ===================
Net loss per share from discontinued operations:
    Basic                                                                    $             (0.07)
                                                                             ===================
    Diluted                                                                  $             (0.07)
                                                                             ===================
Shares used in net income (loss) per share from discontinued operations:
    Basic                                                                                 39,788
                                                                             ===================
    Diluted                                                                               39,788
                                                                             ===================
</Table>



The accompanying notes are an integral part of these financial statements.



                                       3
<PAGE>

                     3DFX INTERACTIVE, INC. AND SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS OF DISCONTINUED OPERATIONS
                                 (In thousands)
                                   (Unaudited)

<Table>
<Caption>
                                                                               For the period from
                                                                               February 1, 2001 to
                                                                                 March 26, 2001
                                                                               -------------------
<S>                                                                            <C>
Cash flows from operating activities:
   Net loss from discontinued operations                                       $            (2,627)

Adjustments to reconcile net income to net cash from operating activities:
   Depreciation                                                                                 --
   Amortization                                                                                 --
   Stock compensation                                                                           --
   Decrease in allowance for doubtful accounts                                              (5,573)
   Changes in assets and liabilities:
      Accounts receivable                                                                   10,725
      Inventory                                                                                183
      Deferred tax asset                                                                        --
      Other assets                                                                             544
      Accounts payable                                                                          --
      Accrued and other liabilities                                                        (11,394)
                                                                               -------------------
         Net cash used in discontinued operating activities                                 (8,142)
                                                                               -------------------
Cash flows from investing activities:
   Sales of short-term investments                                                             188
   Purchases of property and equipment                                                          --
         Net cash provided by investment activities                                            188
                                                                               -------------------
Cash flows from financing activities:
   Proceeds from issuance of common stock, net                                                  --
   Principal payments of capitalized lease obligations, net                                     --
                                                                               -------------------
         Net cash provided by financing activities                                              --
                                                                               -------------------
Net (decrease) increase in cash and cash equivalents                                        (7,954)
Cash and cash equivalents at beginning of period                                             9,391
                                                                               -------------------
Cash and cash equivalents at end of period                                     $             1,437
                                                                               ===================
</Table>



The accompanying notes are an integral part of these financial statements.



                                       4
<PAGE>

                             3DFX INTERACTIVE, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - The Company and its Significant Accounting Policies:


3dfx

         3dfx Interactive, Inc. ("3dfx" or "the Company") was incorporated in
California on August 24, 1994. 3dfx developed high performance, cost-effective
graphics chips, graphics boards, software and related technology that enable an
interactive and realistic 3D experience across multiple hardware platforms. 3dfx
has subsidiaries in the United States and Mexico. The unaudited condensed
consolidated financial statements as of July 31, 2002 and for the three and six
months ended include the financial statements of 3dfx and its wholly owned
subsidiaries. All significant intercompany transactions and accounts have been
eliminated.

         The unaudited condensed consolidated financial statements included
herein have been prepared by 3dfx pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information or footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations. In the opinion of 3dfx, the accompanying unaudited
condensed consolidated financial statements contain all adjustments, consisting
only of normal recurring adjustments, necessary to present fairly the financial
information included therein. While 3dfx believes that the disclosures are
adequate to make the information not misleading, it is suggested that these
financial statements be read in conjunction with the audited financial
statements and accompanying notes included in 3dfx's Annual Report on Form 10-K
for the fiscal year ended January 31, 2002 as filed with the Securities and
Exchange Commission.

         As described below, on March 27, 2001, 3dfx's shareholders approved
proposals to liquidate, wind-up and dissolve 3dfx pursuant to a plan of
dissolution. 3dfx is proceeding to wind-up its affairs and dissolve.
Accordingly, all activities of 3dfx as of and since March 27, 2001 are presented
under the liquidation basis of accounting. Under the liquidation basis of
accounting, assets are stated at their estimated net realizable values and
liabilities are stated at their anticipated settlement amount, if reasonably
estimable. See "Activities While in Liquidation" below. See also Note 6.


NVIDIA ASSET SALE TERMS

         In the fall of 2000, 3dfx began experiencing financial difficulties due
in part to substantially reduced demand in the retail channel for its products.
This reduced demand is attributable to a number of factors, including, in part,
its failure to introduce products in a timely manner and from disappointing
customer response to its existing products, as well as reduced demand in the
retail channel in general and the add-in graphics segment in particular. In
addition, 3dfx's high research and development costs and substantial debt
burden, together with the loss of several large customers due to 3dfx's May 1999
acquisition of STB Systems, Inc. and its inability to refinance its debt on
commercially reasonable terms, aggravated its financial difficulties. After
extensive exploration and evaluation of various strategic alternatives, the 3dfx
board of directors concluded that the liquidation, winding up and dissolution of
3dfx provided the best protection to 3dfx's creditors and was in the best
interests of its shareholders.

         On December 15, 2000, 3dfx entered into an asset purchase agreement
with Nvidia Corporation ("Nvidia") and a subsidiary of Nvidia ("Nvidia Sub")
under which Nvidia Sub would acquire certain of 3dfx's assets, including its
core graphics processor assets. Under the terms of the asset purchase agreement,
Nvidia agreed to pay 3dfx $70.0 million in cash and 2,000,000 shares (on a
post-split basis) of registered



                                       5
<PAGE>

Nvidia common stock, subject to the satisfaction of certain conditions specified
in the asset purchase agreement as described below. Upon signing the asset
purchase agreement, Nvidia loaned to 3dfx $15.0 million in cash for working
capital.

         The asset sale to Nvidia Sub was approved by 3dfx shareholders on March
27, 2001, and on April 18, 2001 substantially all of 3dfx's assets were sold to
Nvidia Sub. Upon closing, 3dfx received $55.0 million in cash, which amount was
net of repayment of the $15.0 million cash loan 3dfx received upon signing the
asset purchase agreement. In addition, under the terms of the asset purchase
agreement, 3dfx and Nvidia Sub caused the pending patent litigation between the
parties to be dismissed with prejudice. Under the terms of the asset purchase
agreement, 3dfx may receive part or all of a one-time post-closing cash payment
of up to $25.0 million upon its request if it is not in breach of the asset
purchase agreement, it has expended all or substantially all of the $70.0
million cash consideration in payment of its liabilities and determines in good
faith that (i) the remaining portion of the cash consideration previously
received by it is not sufficient to pay its remaining liabilities, and (ii) such
remaining liabilities could and would be satisfied if 3dfx received the
post-closing cash payment and applied it to the payment of such liabilities, and
if Nvidia Sub does not determine in good faith that the requested amount would
not permit 3dfx to pay in full its remaining liabilities. In the event that 3dfx
were to receive the post-closing cash payment, the 2,000,000 shares of Nvidia
common stock comprising the remaining consideration otherwise payable to 3dfx
under the asset purchase agreement will be reduced by the number of shares equal
to the quotient determined by dividing the amount of the post-closing cash
payment by $25. 3dfx's net liabilities in liquidation at July 31, 2002 were
$35.2 million.

         The 2,000,000 shares of Nvidia common stock will only become
deliverable to 3dfx upon satisfaction of certain conditions specified in the
asset purchase agreement, including the completion of the winding up of the
business of 3dfx pursuant to 3dfx's plan of dissolution, and 3dfx's
certification that (i) all liabilities of 3dfx and its subsidiaries have been
paid in full or otherwise provided for and (ii) 3dfx has or will be validly
dissolved. As a result of the contingencies described above (including 3dfx's
net liabilities in liquidation, which at July 31, 2002 were $35.2 million), the
contingent receivable and related tax provision on the gain have not been
recorded in the accompanying consolidated statement of net liabilities in
liquidation as of July 31, 2002. The ultimate total of the value of Nvidia stock
received by 3dfx, if any, is dependent on the number and market value of shares
received given the conditions described above.


SERIES B PREFERRED STOCK FINANCING

         On June 13, 2002, 3dfx entered into a Series B Preferred Stock Purchase
Agreement with SF Capital Partners Ltd. whereby SF Capital had agreed to invest
between $25 and $35 million in 3dfx in exchange for shares of 3dfx's Series B
Preferred Stock (the "Series B Financing"). The amount of the investment was to
be based on the sum at closing of 3dfx's fixed and determinable liabilities,
maximum reasonably known undeterminable liabilities and anticipated expenses
reasonably necessary to complete the liquidation, winding-up and dissolution of
3dfx. The agreement with SF Capital provided that once the amount of all of
3dfx's liabilities is determined, or if some liabilities are not determinable
then the maximum amount of all undetermined liabilities shall be reasonably
known to 3dfx and SF Capital, and subject to the satisfaction of certain other
specified conditions, then SF Capital will place the purchase price for the
shares of Series B Preferred Stock into escrow pending closing. The purchase
price will be released to 3dfx from escrow, and the closing of the Series B
Financing will occur, upon the satisfaction of conditions that 3dfx and SF
Capital specify in the escrow agreement. The number of shares of Series B
Preferred Stock of 3dfx issuable to SF Capital at closing will be equal to the
quotient derived by dividing (x) the sum of the investment amount and a
specified percent of the investment amount by (y) the average closing price of
Nvidia common stock for the five trading days preceding the closing. The
"specified percentage of the investment amount" referred to in the preceding
formula ranges from 25% to 40%, and varies based on the price of Nvidia common
stock preceding the closing (the higher



                                       6
<PAGE>

the price of Nvidia common stock, the higher the specified percentage of the
investment amount").

         The Series B Preferred Stock will not be entitled to dividends, subject
to redemption or conversion, and will have no voting rights, but it will have
priority for payment upon the liquidation, winding-up or dissolution of 3dfx. If
3dfx is in the process of liquidating, dissolving or winding up, immediately
upon its receipt of 500,000 or more shares of Nvidia common stock, 3dfx shall
distribute to the holders of the Series B Preferred Stock, at 3dfx's election,
either (i) $90 cash per share of Series B Preferred Stock or (ii) one share of
Nvidia stock per share of Series B Preferred Stock (the "Liquidation
Preference"). In the meantime, the prior written consent of the holders of not
less than a majority of the outstanding shares of Series B Preferred Stock is
required for 3dfx to make any dividends, distributions or redemptions on any
other securities, or for 3dfx to issue any debt or equity securities, or for
3dfx to enter into any merger, sale of shares of capital stock having voting
power with respect to 35% or more of its outstanding capital stock, or any
transaction in which all or substantially all of the assets of 3dfx are sold.
The holders of Series B Preferred Stock will have certain other rights designed
to protect their investment in 3dfx. The stock purchase agreement with SF
Capital is terminable if the funding amount exceeds the $35 million level or
falls under the $25 million level, if the Nvidia closing price is equal to or
less than $26, if the transaction fails to close within one year, if 3dfx is in
material default of the agreement or if the Nvidia common stock is delisted from
the Nasdaq National Market. As of October 28, 2002, Nvidia's closing common
stock price was $11.16 per share. As a result, it is unlikely that the Series B
Financing will be successfully closed.


LIQUIDATION, WINDING UP AND DISSOLUTION

         On December 15, 2000, the board of directors of 3dfx also approved a
plan of dissolution and on March 27, 2001 this plan of dissolution was approved
by 3dfx's shareholders. On March 30, 2001, 3dfx filed a certificate of election
to liquidate, wind up and dissolve with the California Secretary of State's
office. 3dfx is proceeding to wind up its affairs and is no longer operating or
generating revenues in the normal course of business. Accordingly, all of the
activities of 3dfx have been presented on a liquidation basis of accounting. See
also Note 6.

         At this time, 3dfx cannot determine if there will be any assets
remaining after paying for, or providing for the payment of, 3dfx's liquidation
expenses and all of its and its subsidiaries' debts and liabilities, as well as
the distribution of the Liquidation Preference to the holders of the Series B
Preferred Stock (if any).

         3dfx expects to continue to incur certain administrative and other
costs associated with its bankruptcy proceeding and the winding up its affairs.
The amount of unknown or contingent liabilities cannot be quantified and could
decrease or eliminate any remaining assets available for distribution to 3dfx's
common shareholders. Further, if 3dfx or its subsidiaries are subject to any
contingent liabilities, this could require that it establish reserves that could
delay any distribution to 3dfx common shareholders. Because of the uncertainties
as to the source of any 3dfx funds, the settlement amount of 3dfx's and its
subsidiaries' debts and liabilities (including tax liabilities), as well as the
volatility in the market price of Nvidia's stock, 3dfx cannot at this time
determine the timing or amount of distributions that may be made to its common
shareholders, if any. Only if there are assets remaining after the payment of
all debts and liabilities, and the distribution of the Liquidation Preference
(if any), will 3dfx common shareholders receive a distribution of those assets.

         3dfx has substantially reduced its costs in order to conserve its
resources. These cost-cutting measures included the termination of virtually all
employees, reduction in leased space and other efforts to reduce non-essential
expenses. During the fiscal year 2002, 3dfx also continued to liquidate its
remaining assets, negotiate with third parties for resolutions of various
litigation matters that would be agreeable to all parties involved, and to reach
settlements with its vendors in



                                       7
<PAGE>

reduction of its accounts payable, as well as seeking to reach mutually
satisfactory settlements with the lessors of its facilities and equipment
leases. 3dfx provided manufacturing services to third parties to help cover the
overhead associated with its Juarez, Mexico manufacturing facility until its
lease of that facility was terminated in April 2002. The sales and costs of
sales related to these operations are recorded as other income and expense on
the condensed consolidated statement of discontinued operations for the period
from February 1, 2001 to March 26, 2001 and as selling, general, and
administrative expense for the six months ended July 31, 2002 and for the period
from March 27, 2001 to July 31, 2001.


ACTIVITIES WHILE IN LIQUIDATION

         During the six months ended July 31, 2002, 3dfx continued to negotiate
with third parties for resolutions of various litigation matters that would be
agreeable to all parties involved, and to reach settlements with its vendors in
reduction of its accounts payable, as well as seeking to reach mutually
satisfactory settlements with the lessors to its facilities and various
equipment leases. Any remaining inventory and other assets held for sale have
been written down to their net realizable value, which equals zero. As 3dfx is
in liquidation, these remaining assets may be sold. 3dfx believes that any gains
on such sales that may be realized will be immaterial.

         At July 31, 2002, 3dfx was still in negotiations to settle certain
remaining leases under which it has contractual obligations. However, at July
31, 2002, 3dfx had total future lease obligations of $4.8 million and lease
termination costs of $4.0 million in the current year, all of which has been
accrued for as estimated costs during the period of liquidation in 3dfx's
statement of net liabilities in liquidation.

         During the six months ended July 31, 2002, 3dfx incurred selling,
general and administrative costs of $927,000, which were comprised of personnel
expenses, legal and other professional fees, current period facilities expense,
lease payments and lease termination expense. 3dfx also received other income of
$93,000 relating primarily to an income tax refund receivable which was
collected.

         Changes in net liabilities for the period from March 27, 2001 to July
31, 2001 were a result of selling, general and administrative expenses of $9.8
million, which is comprised of operating expenses, accrued expenses and lease
termination expense, partially offset by the forgiveness of liabilities, a
decrease in the deferred tax asset of $35.0 million and the net gain on sale of
assets to Nvidia Sub of $2.3 million, which was comprised of the following: (a)
a gain on the sale of inventory and other assets held for sale to Nvidia Sub of
$14.3 million, which was comprised of the purchase by Nvidia Sub of certain
inventory, fixed assets and intangible assets with net book values of $55.7
million offset by proceeds of $70.0 million and (b) losses of $12.0 million on
sale of and impairment of inventory and other assets held for sale.

         At July 31, 2002, 3dfx had net liabilities in liquidation of $35.2
million. In light of the amount of 3dfx's liabilities, as well as contingencies
relating to unknown or contingent liabilities and Nvidia's delivery of the
shares of Nvidia common stock provided for in the Nvidia asset purchase
agreement, there can be no assurance that 3dfx will have any assets available
for distribution to its common shareholders.



                                       8
<PAGE>

Note 2 - Balance Sheet Components (in thousands):


Estimated Costs During Period of Liquidation:


<Table>
<Caption>
                                           July 31,       January 31,
                                             2002             2002
                                         ------------     ------------
<S>                                      <C>              <C>
Accrued salaries, wages and benefits     $        480     $        680
Accrued leases payable                          8,774           10,563
Other accrued liabilities                         900            1,021
                                         ------------     ------------
                                         $     10,154     $     12,264
                                         ============     ============
</Table>

Note 3 - Net Loss Per Share:


         Basic net loss per share is computed using the weighted average number
of common shares outstanding during the periods. Diluted net loss per share is
computed using the weighted average number of common and potentially dilutive
common shares during the periods presented.

         Diluted loss per share was the same as basic loss per share for the
period from February 1, 2001 to March 26, 2001, and options to purchase
approximately 3,276,380 shares of common stock were outstanding but not included
in the calculation because they were anti-dilutive.

         No per share data is presented on or after March 27, 2001, as such
information is not meaningful.


Note 4 - Comprehensive Loss:


         Total comprehensive loss for the period February 1, 2001 to March 26,
2001 was $3.4 million, comprised of $700,000 from an unrealized loss on
investment in 3Dlabs and net loss from discontinued operations of $2.7 million.


Note 5 - Commitments and Contingencies:

LEASES

         3dfx leases, under noncancelable operating leases, certain of its
facilities and equipment. There were no capital leases outstanding as of July
31, 2002. During fiscal 2002, the Company terminated several of its operating
leases. At July 31, 2002, 3dfx was still in negotiations to settle certain
remaining leases under which it has contractual obligations. However, at July
31, 2002, 3dfx had total future lease obligations of $8.8 million, all of which
has been accrued. The remaining operating lease agreements existing at July 31,
2002, expire at various dates through 2007.


CONTINGENCIES

         3dfx was a party to the following legal proceedings involving certain
collection matters against 3dfx, as previously reported in 3dfx's Annual Report
on Form 10-K for the year ended January 31, 2002. The status of each proceeding
is indicated in the table and, as indicated, 3dfx was successful in reaching
terms agreeable to each of the indicated parties. In light of 3dfx's filing on
October 15,



                                       9
<PAGE>

2002 of a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code,
attempts to enforce any of the judgments is subject to an automatic stay.


<Table>
<Caption>
Factual Basis and
Relief Sought                    Court                         Date Instituted               Status
-----------------                -----                         ---------------               ------
<S>                              <C>                           <C>                           <C>
Aavid Thermalloy                 44th Judicial District of     November 8, 2000              Settled and
Collection suit on unpaid        Texas                                                       dismissed
invoices

Micron Design Systems, Inc.      Santa Clara County Superior   August 17, 2000               Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Quickturn Design Systems, Inc.   Santa Clara County Superior   January 25, 2001              Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Cadence Design Systems, Inc.     Santa Clara County Superior   January 25, 2001              Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

California Micro Devices, Inc.   Santa Clara County Superior   September 24, 2001            Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Siliconware USA, Inc.            Santa Clara County Superior   May 21, 2001                  Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Synopsis, Inc.                   Santa Clara County Superior   August 20, 2001               Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.
</Table>


         3dfx is currently involved in litigation filed against it in the
Superior Court of the State of California for the County of Santa Clara on
February 11, 2002 by Carlyle Fortran Trust, 3dfx's landlord for its former
headquarters in San Jose, California. The landlord filed for breach of lease in
a tenant in possession action based on 3dfx's failure to pay rental amounts that
are delinquent. On June 11, 2002, the court ruled in 3dfx's favor on a Summary
Judgment motion filed by the landlord. The case was set for trial on October 21,
2002 to determine the relevant factual and legal issues, but did not occur in
light of 3dfx's bankruptcy petition filing. On May 10, 2002 Carlyle Fortran
Trust filed a second lawsuit in the Superior Court of the State of California
for the County of Santa Clara against Nvidia and 3dfx, alleging an action for
intentional interference with contract, fraudulent transfer, declaratory relief
and unfair business practices. In September 2002 Carlyle Fortran Trust added
certain of the directors and officers of Nvidia and 3dfx as defendants in this
lawsuit.

         3dfx is a party to litigation filed February 23, 2001 by Worldcom, Inc.
in Dallas County on an open account for telephone services. The amount of
damages stated in the petition was $1,389,000 plus interest and attorney's fees.
The parties engaged in nonbinding mediation on June 24, 2002, but no resolution
was achieved. Initial discovery has been conducted. Trial is currently set for
January 6, 2003, although



                                       10
<PAGE>

3dfx's bankruptcy filing may affect this trial date. 3dfx disputes Worldcom's
claims and intends to vigorously defend itself in this matter.

         Finally, a default judgment was entered in favor of CarrAmerica, 3dfx's
lessor for its offices in Austin, Texas, on May 20, 2002 resulting from a
lawsuit filed April 18, 2002 in the 261st Judicial District Court of Travis
County, Texas. The judgment is now final.

         As the Nvidia asset purchase agreement requires that 3dfx wind up and
dissolve, on July 15, 2002 3dfx filed a petition with the Superior Court of the
State of California for the County of Santa Clara requesting that the Court take
jurisdiction over 3dfx's winding up proceeding as allowed by the California
corporate law. Two of 3dfx's creditors challenged this request. The Court
formally denied 3dfx's request on September 6, 2002.

         3dfx is also a party to various other lawsuits. Although the amount of
any liability that could arise with respect to these other proceedings cannot be
predicted accurately, 3dfx believes that any liability that might result from
these other claims will not have a material adverse effect on its financial
position.


Note 6 - Subsequent Event:

         On October 15, 2002 3dfx filed a voluntary petition under Chapter 11 of
the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Northern
District of California under Case No. 02-55795 and an order for relief was
entered by the Bankruptcy Court. As a result of the Chapter 11 filing, claims
against 3dfx are subject to an automatic stay, and no party may take action to
realize its pre-petition claims, except pursuant to an order of the Bankruptcy
Court.


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF DISCONTINUED OPERATIONS

         This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. Any statements contained in this document, including
without limitation statements to the effect that 3dfx or its management
"believes," "expects," "anticipates," "plans," "may," "will," "projects,"
"continues," or "estimates," or statements concerning "potential," or
"opportunity" or other variations thereof or comparable terminology or the
negative thereof, that are not statements of historical fact should be
considered forward-looking statements. These forward-looking statements are
based on current expectations and entail various risks and uncertainties that
could cause actual results to differ materially from those projected in the
forward-looking statements. Some of such risks and uncertainties are set forth
below under "Risk Factors."


OVERVIEW

         3dfx developed high performance, cost-effective graphics chips,
graphics boards, software and related technology that enabled an interactive and
realistic 3D experience across multiple hardware platforms, but is now in the
process of winding up its business. As discussed below, on March 27, 2001,
3dfx's shareholders approved proposals to liquidate, wind up and dissolve 3dfx
pursuant to a plan of dissolution and to sell certain of its assets to Nvidia US
Investment Company ("Nvidia Sub"), a wholly owned subsidiary of Nvidia
Corporation ("Nvidia"). 3dfx is continuing to wind up its affairs and dissolve.
Accordingly, all activities of 3dfx subsequent to March 27, 2001 are presented
on a liquidation basis in the accompanying consolidated financial statements.
Additionally, on October 15, 2002, 3dfx voluntarily filed a petition with the
United States Bankruptcy Court for the Northern District of California under
Chapter 11 of the United States Bankruptcy Code.



                                       11
<PAGE>

NVIDIA ASSET SALE TERMS

         In the fall of 2000, 3dfx began experiencing financial difficulties due
in part to substantially reduced demand in the retail channel for its products.
This reduced demand is attributable to a number of factors, including, in part,
its failure to introduce products in a timely manner and from disappointing
customer response to its existing products, as well as reduced demand in the
retail channel in general and the add-in graphics segment in particular. In
addition, 3dfx's high research and development costs and substantial debt
burden, together with the loss of several large customers due to 3dfx's May 1999
acquisition of STB Systems, Inc. and its inability to refinance its debt on
commercially reasonable terms, aggravated its financial difficulties. After
extensive exploration and evaluation of various strategic alternatives, the 3dfx
board of directors concluded that the liquidation, winding up and dissolution of
3dfx provided the best protection to 3dfx's creditors and was in the best
interests of its shareholders.

         On December 15, 2000, 3dfx entered into an asset purchase agreement
with Nvidia and Nvidia Sub under which Nvidia Sub would acquire certain of
3dfx's assets, including its core graphics processor assets. Under the terms of
the asset purchase agreement, Nvidia Sub agreed to pay 3dfx $70.0 million in
cash and 2,000,000 shares of registered Nvidia common stock (after giving effect
to a recent Nvidia stock split), subject to the satisfaction of certain
conditions specified in the asset purchase agreement as described below. Upon
signing the asset purchase agreement, Nvidia Sub loaned to 3dfx $15.0 million in
cash for working capital.

         The asset sale to Nvidia Sub was approved by 3dfx shareholders on March
27, 2001, and on April 18, 2001 substantially all of 3dfx's assets were sold to
Nvidia Sub. Upon closing, 3dfx received $55.0 million in cash, which amount was
net of repayment of the $15.0 million cash loan 3dfx received upon signing the
asset purchase agreement. In addition, under the terms of the asset purchase
agreement, 3dfx and Nvidia Sub caused the pending patent litigation between the
parties to be dismissed with prejudice. Under the terms of the asset purchase
agreement, 3dfx may receive part or all of a one-time post-closing cash payment
of up to $25.0 million upon its request if it is not in breach of the asset
purchase agreement, it has expended all or substantially all of the $70.0
million cash consideration in payment of its liabilities and determines in good
faith that (i) the remaining portion of the cash consideration previously
received by it is not sufficient to pay its remaining liabilities, and (ii) such
remaining liabilities could and would be satisfied if 3dfx received the
post-closing cash payment and applied it to the payment of such liabilities, and
if Nvidia Sub does not determine in good faith that the requested amount would
not permit 3dfx to pay in full its remaining liabilities. In the event that 3dfx
were to receive the post-closing cash payment, the 2,000,000 shares of Nvidia
common stock comprising the remaining consideration otherwise payable to 3dfx
under the asset purchase agreement will be reduced by the number of shares equal
to the quotient determined by dividing the amount of the post-closing cash
payment by $25. 3dfx's net liabilities in liquidation at July 31, 2002, were
$35.2 million.

         The 2,000,000 shares of Nvidia common stock will only become
deliverable to 3dfx upon satisfaction of certain conditions specified in the
asset purchase agreement, including the completion of the winding up of the
business of 3dfx pursuant to 3dfx's plan of dissolution, and 3dfx's
certification that (i) all liabilities of 3dfx and its subsidiaries have been
paid in full or otherwise provided for and (ii) 3dfx has or will be validly
dissolved. The ultimate total value of the Nvidia stock received by 3dfx, if
any, is dependent on the number and market value of shares received given the
conditions described above.


SERIES B PREFERRED STOCK FINANCING

         On June 13, 2002, 3dfx entered into a Series B Preferred Stock Purchase
Agreement with SF Capital Partners Ltd. whereby SF Capital agreed to invest
between $25 and $35 million in 3dfx in exchange for shares of 3dfx's Series B
Preferred Stock (the "Series B Financing"). The amount of the investment will be
based on the sum at



                                       12
<PAGE>

closing of 3dfx's fixed and determinable liabilities, maximum reasonably known
undeterminable liabilities and anticipated expenses reasonably necessary to
complete the liquidation, winding-up and dissolution of 3dfx. The agreement with
SF Capital provides that once the amount of all of 3dfx's liabilities is
determined, or if some liabilities are not determinable then the maximum amount
of all undetermined liabilities shall be reasonably known to 3dfx and SF
Capital, and subject to the satisfaction of certain other specified conditions,
then SF Capital will place the purchase price for the shares of Series B
Preferred Stock into escrow pending closing. The purchase price will be released
to 3dfx from escrow, and the closing of the Series B Financing will occur, upon
the satisfaction of conditions that 3dfx and SF Capital specify in the escrow
agreement. The number of shares of Series B Preferred Stock of 3dfx issuable to
SF Capital at closing will be equal to the quotient derived by dividing (x) the
sum of the investment amount and a specified percent of the investment amount by
(y) the average closing price of Nvidia common stock for the five trading days
preceding the closing. The "specified percentage of the investment amount"
referred to in the preceding formula ranges from 25% to 40%, and varies based on
the price of Nvidia common stock preceding the closing (the higher the price of
Nvidia common stock, the higher the "specified percentage of the investment
amount").

         The Series B Preferred Stock will not be entitled to dividends, subject
to redemption or conversion, and will have no voting rights, but it will have
priority for payment upon the liquidation, winding-up or dissolution of 3dfx. If
3dfx is in the process of liquidating, dissolving or winding up, immediately
upon its receipt of 500,000 or more shares of Nvidia common stock, 3dfx shall
distribute to the holders of the Series B Preferred Stock, at 3dfx's election,
either (i) $90 cash per share of Series B Preferred Stock or (ii) one share of
Nvidia stock per share of Series B Preferred Stock (the "Liquidation
Preference"). In the meantime, the prior written consent of the holders of not
less than a majority of the outstanding shares of Series B Preferred Stock is
required for 3dfx to make any dividends, distributions or redemptions on any
other securities, or for 3dfx to issue any debt or equity securities, or for
3dfx to enter into any merger, sale of shares of capital stock having voting
power with respect to 35% or more of its outstanding capital stock, or any
transaction in which all or substantially all of the assets of 3dfx are sold.
The holders of Series B Preferred Stock will have certain other rights designed
to protect their investment in 3dfx. The stock purchase agreement with SF
Capital is terminable if the funding amount exceeds the $35 million level or
falls under the $25 million level, if the Nvidia closing price is equal to or
less than $26, if the transaction fails to close within one year, if 3dfx is in
material default of the agreement or if the Nvidia common stock is delisted from
the Nasdaq National Market. As of October 28, 2002, Nvidia's closing common
stock price was $11.16 per share. As a result, it is unlikely that the Series B
Financing will be successfully closed.


BANKRUPTCY FILING

         As the Nvidia asset purchase agreement requires that 3dfx wind up and
dissolve, on July 15, 2002 3dfx filed a petition with the Superior Court of the
State of California for the County of Santa Clara requesting that the Court take
jurisdiction over 3dfx's winding up proceeding as allowed by the California
corporate law. Two of 3dfx's creditors challenged this request. The Court
formally denied 3dfx's request on September 6, 2002.

         Given the foregoing developments, and in light of 3dfx's significant
debts and liabilities, dwindling cash resources and the fact that 3dfx was not
yet in a position to either obtain the remaining consideration provided for
under the Nvidia asset purchase agreement or to close the Series B Financing, on
October 15, 2002 3dfx voluntarily filed a petition with the United States
Bankruptcy Court for the Northern District of California under Chapter 11 of the
United States Bankruptcy Code. As a result of the Chapter 11 filing, claims
against 3dfx are subject to an automatic stay, and no party may take action to
realize its pre-petition claims, except pursuant to an order of the Bankruptcy
Court. 3dfx sought bankruptcy protection because it believes that the bankruptcy
process provides the best means of enabling it to repay its creditors, as well
the best means of providing an opportunity for 3dfx to make a



                                       13
<PAGE>

distribution to its common shareholders. In addition, under Section 502(b)(6) of
the United States Bankruptcy Code, 3dfx is entitled to seek the rejection of its
two unexpired leases. The Bankruptcy Code places a limit on the amount of a
claim that a lessor to a rejected lease can assert, which limit is the greater
of (i) one year's rent under the lease or (ii) 15% of the remaining lease
rentals up to an amount equal to the total that would be due over three years.
3dfx calculates that the application of the foregoing limit would result in the
elimination of approximately $5.1 million from its currently calculated net
liabilities in liquidation. There can be no assurance that 3dfx will be
successful in its efforts to have the leases rejected.


LIQUIDATION, WINDING UP AND DISSOLUTION

         On December 15, 2000, the board of directors of 3dfx approved a plan of
dissolution and on March 27, 2001 this plan of dissolution was approved by
3dfx's shareholders. On March 30, 2001, 3dfx filed a certificate of election to
liquidate, wind up and dissolve with the California Secretary of State's office.
3dfx is proceeding to wind up its affairs and is no longer operating or
generating revenues in the normal course of business.

         At this time, 3dfx cannot determine if there will be any assets
remaining after paying for, or providing for the payment of, 3dfx's liquidation
expenses and all of its and its subsidiaries' debts and liabilities, as well as
the distribution of the Liquidation Preference to the holders of the Series B
Preferred Stock (if any).

         3dfx expects to continue to incur certain administrative and other
costs associated with its bankruptcy proceeding and the winding up its affairs.
The amount of unknown or contingent liabilities cannot be quantified and could
decrease or eliminate any remaining assets available for distribution to 3dfx's
common shareholders. Further, if 3dfx or its subsidiaries are subject to any
contingent liabilities, this could require that it establish reserves that could
delay any distribution to 3dfx common shareholders. Because of the uncertainties
as to the source of any 3dfx funds, the settlement amount of 3dfx's and its
subsidiaries' debts and liabilities (including tax liabilities), as well as the
volatility in the market price of Nvidia's stock, 3dfx cannot at this time
determine the timing or amount of distributions that may be made to its common
shareholders, if any. Only if there are assets remaining after the payment of
all debts and liabilities, and the distribution of the Liquidation Preference
(if any), will 3dfx common shareholders receive a distribution of those assets.

         3dfx has substantially reduced its costs in order to conserve its
resources. These cost-cutting measures included the termination of virtually all
employees, reduction in leased space and other efforts to reduce non-essential
expenses. During fiscal 2002, 3dfx also continued to liquidate its remaining
assets, negotiate with third parties for resolutions of various litigation
matters that would be agreeable to all parties involved, and to reach
settlements with its vendors in reduction of its accounts payable, as well as
seeking to reach mutually satisfactory settlements with the lessors of its
facilities and equipment leases. 3dfx provided manufacturing services to third
parties to help cover the overhead associated with its Juarez, Mexico
manufacturing facility until its lease of that facility was terminated in April
2002. The sales and costs of sales related to these operations are recorded as
other income and expense on the condensed consolidated statement of discontinued
operations for the period from February 1, 2001 to March 26, 2001, and as
selling, general, and administrative expense for the six months ended July 31,
2002 and for the period from March 27, 2001 to July 31, 2001.


ACTIVITIES WHILE IN LIQUIDATION

         During the six months ended July 31, 2002, 3dfx continued to negotiate
with third parties for resolutions of various litigation matters that would be
agreeable to all parties involved, and to reach settlements with its vendors in
reduction of its accounts payable, as well as seeking to reach mutually
satisfactory settlements with the lessors to its facilities and various
equipment leases. Any remaining inventory



                                       14
<PAGE>

and other assets held for sale have been written down to their net realizable
value, which equals zero. As 3dfx is in liquidation, these remaining assets may
be sold. 3dfx believes that any gains on such sales that may be realized will be
immaterial.

         At July 31, 2002, 3dfx was still in negotiations to settle certain
remaining leases under which it has contractual obligations. However, at July
31, 2002, 3dfx had total future lease obligations of $4.8 million and lease
termination costs of $4.0 million in the current year, all of which has been
accrued for as estimated costs during the period of liquidation in 3dfx's
statement of net liabilities in liquidation.

         At July 31, 2002, 3dfx had net liabilities in liquidation of $35.2
million. In light of the amount of 3dfx's net liabilities, as well as
significant contingencies relating to unknown or contingent liabilities and
substantial uncertainty as to 3dfx's receipt of any of the remaining
consideration provided for in the Nvidia asset purchase agreement or the closing
of the Series B Financing, there can be no assurance that 3dfx will have any
assets available for distribution to its common shareholders.


STATEMENT OF CHANGES IN NET LIABILITIES IN LIQUIDATION

         During the six months ended July 31, 2002, 3dfx incurred selling,
general and administrative costs of $927,000, which were comprised of personnel
expenses, legal and other professional fees, current period facilities expense,
lease payments and lease termination expense.

         Changes in net liabilities for the period from March 27, 2001 to July
31, 2001 were a result of selling, general and administrative expenses of $9.8
million, which is comprised of operating expenses, accrued expenses and lease
termination expense, partially offset by the forgiveness of liabilities, a
decrease in the deferred tax asset of $35.0 million and the net gain on sale of
assets to Nvidia Sub of $2.3 million, which was comprised of the following: (a)
a gain on the sale of inventory and other assets held for sale to Nvidia Sub of
$14.3 million, which was comprised of the purchase by Nvidia Sub of certain
inventory, fixed assets and intangible assets with net book values of $55.7
million offset by proceeds of $70.0 million and (b) losses of $12.0 million on
sale of and impairment of inventory and other assets held for sale.

         3dfx's receipt of the shares of Nvidia common stock provided for in the
Nvidia asset purchase agreement has not been recorded in the accompanying
consolidated statement of net liabilities in liquidation, because obtaining the
cash necessary to pay 3dfx's liabilities is a condition to 3dfx being entitled
to receive the shares of Nvidia stock.


RESULTS OF DISCONTINUED OPERATIONS

For the period from February 1, 2001 to March 26, 2001

         Revenues. 3dfx did not have any revenues for the period from February
1, 2001 to March 26, 2001.

         Selling, General and Administrative. Selling, general and
administrative expenses include compensation and benefits for sales, marketing,
finance and administration personnel, commissions paid to independent sales
representatives, tradeshow, advertising and other promotional expenses and
facilities expenses. Selling, general and administrative expenses were $7.8
million for the period from February 1, 2001 to March 26, 2001.

         Other Income (Expense), Net. Other income (expense), net was $182,000
for the period from February 1, 2001 to March 26, 2001.

LIQUIDITY AND CAPITAL RESOURCES



                                       15
<PAGE>

         As of July 31, 2002, 3dfx had cash and cash equivalents of $80,000.

         On April 18, 2001, 3dfx completed the sale of substantially all of its
assets to Nvidia Sub and at the closing received cash in the net amount of $55
million pursuant to an asset purchase agreement. After establishing a reserve
for the winding up of its affairs, 3dfx used the remaining proceeds received
from the asset sale to Nvidia Sub to pay a significant portion of its and its
subsidiaries' known and determinable debts and liabilities. As described above,
3dfx must satisfy a number of conditions provided for in the Nvidia asset
purchase agreement in order to qualify for payment of the remaining
consideration provided for in that agreement. 3dfx has not yet satisfied those
conditions, and there can be no assurance that 3dfx will be able to satisfy the
conditions to its receipt of the remaining consideration provided for in the
Nvidia asset purchase agreement.

         On June 13, 2002, 3dfx entered into a Series B Preferred Stock Purchase
Agreement with SF Capital Partners Ltd. whereby SF Capital has agreed to invest
between $25 and $35 million in 3dfx in exchange for shares of 3dfx's Series B
Preferred Stock (the Series B Financing). The closing of the Series B Financing
is subject to a number of conditions, and the stock purchase agreement can be
terminated under a number of circumstances including if the Nvidia closing price
is equal to or less than $26. Nvidia's stock price is currently less than $26.
3dfx made arrangements to obtain the Series B Financing in order to provide the
cash funding necessary to pay its liabilities and otherwise satisfy the
requirements to the delivery of the Nvidia stock to 3dfx under the Nvidia asset
purchase agreement. As Nvidia's closing stock price was $11.16 per share on
October 28, 2002, it is unlikely that the Series B Financing will be
successfully closed.

         In light of 3dfx's significant debts and liabilities and the denial of
3dfx's petition requesting that a California court assume jurisdiction over its
winding up, and given 3dfx's dwindling cash resources and the fact that it was
not yet in a position to either obtain the remaining consideration provided for
under the Nvidia asset purchase agreement or close the Series B Financing, on
October 15, 2002 3dfx voluntarily filed a petition with the United States
Bankruptcy Court for the Northern District of California under Chapter 11 of the
United States Bankruptcy Code. 3dfx's principal anticipated liquidity needs
involve personnel and professional expenses associated with its bankruptcy
proceeding. 3dfx is seeking to address each of these liquidity needs with its
remaining cash resources.

         At July 31, 2002, 3dfx had net liabilities in liquidation of $35.2
million. In light of the amount of 3dfx's net liabilities, as well as
significant contingencies relating to unknown or contingent liabilities, and
substantial uncertainty as to 3dfx's receipt of any of the remaining
consideration provided for in the Nvidia asset purchase agreement or the closing
of the Series B Financing, there can be no assurance that 3dfx will have any
assets available for distribution to its common shareholders.


RISK FACTORS

         This Report contains certain forward-looking statements within the
meaning of the federal securities laws. 3dfx's actual results and the timing of
certain events could differ greatly from those anticipated in these
forward-looking statements as a result of known and unknown factors, including
the risks faced by 3dfx described below. The risks and uncertainties described
below are not the only ones facing 3dfx. Additional risks and uncertainties not
presently known by 3dfx or that 3dfx does not currently believe are important
may also harm 3dfx's business operations. If any of the following risks actually
occur, 3dfx's business, financial conditions or results of operations could be
seriously harmed. The following factors and other information in this Report
should be considered carefully in evaluating 3dfx and an investment in 3dfx's
common stock.

3DFX CANNOT DETERMINE AT THIS TIME THE AMOUNT OF DISTRIBUTIONS TO ITS COMMON
SHAREHOLDERS, OR WHETHER ANY DISTRIBUTIONS WILL BE MADE, BECAUSE THERE ARE A
VARIETY



                                       16
<PAGE>

OF FACTORS, SOME OF WHICH ARE OUTSIDE OF 3DFX'S CONTROL, THAT COULD AFFECT THE
ABILITY OF 3DFX TO MAKE DISTRIBUTIONS TO ITS COMMON SHAREHOLDERS.

         3dfx cannot determine at this time the amount of or whether there will
be any distributions to its common shareholders because that determination
depends on a variety of factors, including, but not limited to, whether and when
3dfx will receive the remaining consideration provided for in the Nvidia asset
purchase agreement, whether and when the Series B Financing will close, what the
value is of 3dfx's remaining assets, the amount of 3dfx's and its subsidiaries'
known and unknown debts and liabilities (including the resolution of pending
litigation and other contingent liabilities), and other matters. Examples of
uncertainties that could reduce the value or eliminate distributions to 3dfx
common shareholders include the following:

         o     Whether and when 3dfx will satisfy the conditions to the delivery
               of the remaining consideration provided for in the Nvidia asset
               purchase agreement.

         o     Whether and when the Series B Financing will close, which is
               subject to a number of conditions, including (i) the Nvidia stock
               price being greater than $26 per share (Nvidia's closing stock
               price on October 28, 2002 was $11.16 per share) and (ii) the
               funding amount necessary to satisfy all of 3dfx's debts and
               liabilities being less than $35 million.

         o     The uncertainties relating to 3dfx's bankruptcy proceedings.

         o     The volatility in the market price of Nvidia stock.

         o     Delays in completing 3dfx's bankruptcy proceedings and the
               ultimate dissolution of 3dfx could result in additional expenses
               and result in no distributions to 3dfx common shareholders.

         o     The amount of 3dfx's and its subsidiaries' debts and liabilities
               and the estimate of the costs and expenses of 3dfx's bankruptcy
               proceedings and dissolution, including any tax liabilities.

         o     If liabilities of 3dfx or its subsidiaries that are unknown or
               contingent later arise or become fixed in amounts that are
               greater than anticipated.

         o     If the resolution of claims disputed by 3dfx results in greater
               than anticipated liabilities or expenses.

For the foregoing reasons, there can be no assurance that there will be any
distribution to common shareholders.


AS A RESULT OF 3DFX'S BANKRUPTCY FILING, ITS COMMON SHAREHOLDERS MAY NOT REALIZE
ANY VALUE FOR THEIR SHARES.

         On October 15, 2002, 3dfx filed a voluntary petition for bankruptcy
protection under Chapter 11 of the U.S. Bankruptcy Code. Currently, neither 3dfx
nor its creditors have proposed a plan of reorganization and there can be no
assurance that the Bankruptcy Court will confirm any plan of reorganization that
3dfx or its creditors may propose. As provided by the Bankruptcy Code, 3dfx
initially has the exclusive right to propose a plan of reorganization for 120
days following the filing of its Chapter 11 petition. If 3dfx fails to file a
plan of reorganization during such period or any extension thereof as approved
by the Bankruptcy Court, or if such plan is not accepted by the requisite number
of creditors entitled to vote on the plan, other parties in interest in the
bankruptcy proceeding may be permitted to



                                       17
<PAGE>
propose their own plan or plans of reorganization. The failure to have a plan of
reorganization approved by the Bankruptcy Court could result in a liquidation of
3dfx's remaining assets, consisting predominantly of its cash and cash
equivalents. During the bankruptcy proceeding, 3dfx will incur significant costs
including, but not limited to, personnel and professional fees and other cash
demands typical in bankruptcy proceedings. These costs, which are being expensed
as incurred, are expected to significantly decrease 3dfx's remaining cash
resources and otherwise decrease any assets that may ultimately be available for
distribution to 3dfx's common shareholders. Further, 3dfx may incur
unanticipated expenses and liabilities associated with the bankruptcy.

         In addition, 3dfx has not yet proposed its plan of reorganization, and
it is uncertain at this time what will be the effect of the plan on its
creditors and shareholders. 3dfx does not know if the plan will enable it to pay
in whole or in part the claims of its creditors, nor whether there will assets
sufficient to make a distribution to shareholders. Due to the existence of
contingent claims, 3dfx may not be able to make a full distribution for some
time, even if a distribution is made at all. 3dfx may be unable to develop,
prosecute, confirm and consummate a plan of reorganization, and may incur
unanticipated expenses of and liabilities associated with litigation and
bankruptcy.


3DFX MAY NOT BE ABLE TO SATISFY ITS DEBT OBLIGATIONS AND UNLESS AND UNTIL IT CAN
DO SO, IT WILL NOT BE ABLE TO MAKE A DISTRIBUTION TO ITS COMMON SHAREHOLDERS.

         3dfx may not be able to obtain payment of the remaining consideration
provided for under the Nvidia asset purchase agreement or to close the Series B
Financing, in which event it would have no apparent source of funds with which
to satisfy all of its known and unknown debts and liabilities. Unless and until
3dfx can satisfy all of its debts and liabilities, it will not be able to make a
distribution to its common shareholders. Further, even if 3dfx can pay all of
its debts and liabilities, it is not likely that 3dfx will be able to make a
distribution of any significance to its common shareholders and there can be no
assurance as to the likely timing of any such distribution.


3DFX IS UNABLE TO SPECIFY THE TYPE OF ASSETS THAT MAY BE DISTRIBUTED TO 3DFX'S
COMMON SHAREHOLDERS, IF ANY DISTRIBUTION IS MADE.

         In the event 3dfx is able to satisfy all of its debts and liabilities
and  to make a distribution of remaining assets to its common stockholders,
there can be no assurance as to the type of assets that may be distributed. To
the extent that 3dfx receives shares of Nvidia common stock, 3dfx may distribute
the shares of Nvidia common stock received by it upon its dissolution directly
to its common shareholders, or it may sell these shares in the open market or
contribute the shares to a liquidating trust for the benefit of 3dfx's common
shareholders. Further, 3dfx may elect to directly distribute shares of Nvidia
common stock to some of its common shareholders, while distributing an
equivalent per share value in cash to others who would otherwise be entitled to
receive a fractional amount or small number of shares of Nvidia common stock. At
this time, 3dfx is unable to provide specifics about the type of assets that
3dfx's common shareholders may receive or what the value of those assets might
be at the time of distribution, if any distribution is made.



                                       18
<PAGE>

3DFX's COMMON STOCK WAS RECENTLY REMOVED FROM THE OTCBB AND IS NOW QUOTED IN THE
OTC PINK SHEETS.

         Trading in 3dfx's common stock was quoted on the National Association
of Securities Dealers' OTC Bulletin Board ("OTCBB") until October 2002. At that
time, quotations for trading in 3dfx's common stock commenced in the OTC "pink
sheets" due to 3dfx's inability to file current reports with the SEC. As a
consequence, it is expected that 3dfx shareholders will find it more difficult
to dispose of, or to obtain accurate quotations as to the market value of, 3dfx
common stock.


ONCE 3DFX IS DISSOLVED OR ALL OF ITS ASSETS ARE TRANSFERRED TO A LIQUIDATING
TRUST, IT WILL CLOSE ITS STOCK TRANSFER BOOKS AND NO TRANSFER OF 3DFX'S COMMON
STOCK WILL BE RECORDED.

         Once 3dfx is dissolved or all of its assets are transferred to a
liquidating trust, it will close its stock transfer books and no transfer of
3dfx's common stock will be recorded. Thereafter, certificates representing 3dfx
common stock will not be assignable or transferable on 3dfx's books except by
will, intestate succession or operation of law. The equity interests of all of
3dfx's shareholders will be fixed on the basis of their respective stock
holdings at the close of business on the final record date for the distribution
of all remaining assets of 3dfx, and after the final record date, any
distributions made by 3dfx will be made solely to the common shareholders of
record on such date, except as may be necessary to reflect subsequent transfers
recorded on 3dfx's books as a result of any assignments by will, intestate
succession or operation of law. For any other trades after the final record
date, the seller and purchaser of 3dfx's stock will need to negotiate and rely
on contractual obligations between themselves with respect to the right to a
liquidating distribution arising from ownership of 3dfx's common stock.


3DFX WILL CONTINUE TO INCUR THE EXPENSE OF COMPLYING WITH REPORTING REQUIREMENTS
UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT").

         3dfx is obligated to comply with applicable reporting requirements of
the Exchange Act, even though compliance with such reporting requirements is
economically burdensome. The Exchange Act provides for an exemption which allows
an issuer to terminate its reporting obligations under the Exchange Act under
certain circumstances. However, 3dfx is unable to terminate its reporting
obligations at this time. 3dfx cannot predict if, or when, it will meet the
requirements for the exemption. In the meantime, 3dfx intends to soon file a
request with the Securities and Exchange Commission (SEC) requesting that the
SEC approve a "no-action position" that would permit 3dfx to file bankruptcy
court reports with the SEC in lieu of the periodic reports required under the
Securities Exchange Act of 1934. There can be no assurance that the SEC will
approve a "no-action position," but if it does so then 3dfx's SEC reporting
expenses will be reduced. The expenses for the preparation and filing of reports
with the SEC will in any case reduce 3dfx's limited cash resources.


ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

         3dfx's cash equivalents are exposed to financial market risks due to
fluctuations and interest rates, which may affect interest income. Due to the
short term nature of 3dfx's investment portfolio, 3dfx would not expect
operating results or cash flows to be affected to any significant degree by the
effect of a sudden change in market interest rates. 3dfx does not use its
investment portfolio for trading or other speculative purposes.



                                       19
<PAGE>

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

         3dfx was a party to the following legal proceedings involving certain
collection matters against 3dfx, as previously reported in 3dfx's Annual Report
on Form 10-K for the year ended January 31, 2002. The status of each proceeding
is indicated in the table and, as indicated, 3dfx was successful in reaching
terms agreeable to each of the indicated parties. In light of 3dfx's filing on
October 15, 2002 of a voluntary petition under Chapter 11 of the U.S. Bankruptcy
Code, attempts to enforce any of the judgments is subject to an automatic stay.


<Table>
<Caption>
Factual Basis and
Relief Sought                    Court                         Date Instituted               Status
-----------------                -----                         ---------------               ------
<S>                              <C>                           <C>                           <C>
Aavid Thermalloy                 44th Judicial District of     November 8, 2000              Settled and
Collection suit on unpaid        Texas                                                       dismissed
invoices

Micron Design Systems, Inc.      Santa Clara County Superior   August 17, 2000               Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Quickturn Design Systems, Inc.   Santa Clara County Superior   January 25, 2001              Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Cadence Design Systems, Inc.     Santa Clara County Superior   January 25, 2001              Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

California Micro Devices, Inc.   Santa Clara County Superior   September 24, 2001            Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Siliconware USA, Inc.            Santa Clara County Superior   May 21, 2001                  Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.

Synopsis, Inc.                   Santa Clara County Superior   August 20, 2001               Stipulated judgment
Collection suit on unpaid        Court                                                       entered
contract.
</Table>


         3dfx is currently involved in litigation filed against it in the
Superior Court of the State of California for the County of Santa Clara on
February 11, 2002 by Carlyle Fortran Trust, 3dfx's landlord for its former
headquarters in San Jose, California. The landlord filed for breach of lease in
a tenant in possession action based on 3dfx's failure to pay rental amounts that
are delinquent. On June 11, 2002, the court ruled in 3dfx's favor on a Summary
Judgment motion filed by the landlord. The case was set for trial on October 21,
2002 to determine the relevant factual and legal issues, but did not occur in
light of 3dfx's bankruptcy petition filing. On May 10, 2002 Carlyle Fortran
Trust filed a second lawsuit in the Superior Court of the State of California
for the County of Santa Clara against Nvidia and 3dfx, alleging an action for
intentional interference with contract, fraudulent transfer, declaratory



                                       20
<PAGE>

relief and unfair business practices. In September 2002 Carlyle Fortran Trust
added certain of the directors and officers of Nvidia and 3dfx as defendants in
this lawsuit.

         3dfx is a party to litigation filed February 23, 2001 by Worldcom, Inc.
in Dallas County on an open account for telephone services. The amount of
damages stated in the petition was $1,389,000 plus interest and attorney's fees.
The parties engaged in nonbinding mediation on June 24, 2002, but no resolution
was achieved. Initial discovery has been conducted. Trial is currently set for
January 6, 2003, although 3dfx's bankruptcy filing may affect this trial date.
3dfx disputes Worldcom's claims and intends to vigorously defend itself in this
matter.

         Finally, a default judgment was entered in favor of CarrAmerica, 3dfx's
lessor for its offices in Austin, Texas, on May 20, 2002 resulting from a
lawsuit filed April 18, 2002 in the 261st Judicial District Court of Travis
County, Texas. The judgment is now final.

         As the Nvidia asset purchase agreement requires that 3dfx wind up and
dissolve, on July 15, 2002 3dfx filed a petition with the Superior Court of the
State of California for the County of Santa Clara requesting that the Court take
jurisdiction over 3dfx's winding up proceeding as allowed by the California
corporate law. Two of 3dfx's creditors challenged this request. The Court
formally denied 3dfx's request on September 6, 2002.

         On October 15, 2002 3dfx filed a voluntary petition under Chapter 11 of
the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Northern
District of California under Case No. 02-55795 and an order for relief was
entered by the Bankruptcy Court. As a result of the Chapter 11 filing, claims
against 3dfx are subject to an automatic stay, and no party may take action to
realize its pre-petition claims, except pursuant to an order of the Bankruptcy
Court. On October 15, 2002 3dfx also filed with the United States Bankruptcy
Court a schedule of its assets, liabilities, executory contracts and unexpired
leases. A list of 3dfx's equity security holders was also filed with the
Bankruptcy Court on October 15, 2002.

         3dfx is also a party to various other lawsuits. Although the amount of
any liability that could arise with respect to these other proceedings cannot be
predicted accurately, 3dfx believes that any liability that might result from
these other claims will not have a material adverse effect on its financial
position.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

         NONE

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

         None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None

ITEM 5. OTHER INFORMATION

         Effective with 3dfx's voluntary filing of a petition under Chapter 11
of the United States Bankruptcy Code, all of the members of the board of
directors of 3dfx resigned.



                                       21
<PAGE>

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

              (a) Exhibits

                  10.1     First Amendment to Employment Agreement between 3dfx
                           and Richard A. Heddleson.

                  99.1     Certification of Chief Executive Officer and Chief
                           Financial Officer Pursuant to 18 U.S.C. Section 1350,
                           as Adopted Pursuant to Section 906 of the
                           Sarbanes-Oxley Act of 2002 filed herewith.

              (b) Reports on Form 8-K

                  (i)   Current Report on Form 8-K filed on May 16, 2002
                        reporting under Item 5 certain delays in filing 3dfx's
                        Form 10-K for the year ended January 31, 2002.

                  (ii)  Current Report on Form 8-K filed on June 21, 2002
                        reporting under Item 5 certain delays in filing 3dfx's
                        Form 10-Q for the quarter ended April 30, 2002.

                  (iii) Current Report on Form 8-K filed on October 21, 2002
                        reporting under Item 3 3dfx's voluntary filing of a
                        petition under Chapter 11 of the United States
                        Bankruptcy Code.



                                       22
<PAGE>

         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.

Dated: October 31, 2002
                                       3DFX INTERACTIVE, INC.
                                       (Registrant)

                                       By: /s/ Richard A. Heddleson
                                          --------------------------------------
                                       Richard A. Heddleson
                                       President, Chief Executive Officer and
                                       Chief Financial Officer
                                       (Principal Executive Officer and
                                       Principal Financial Officer and Duly
                                       Authorized Officer)


                                  CERTIFICATION

I, Richard A. Heddleson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of 3dfx Interactive, Inc.;

2. Based on my knowledge, the report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by the report; and

3. Based on my knowledge, the financial statements, and other financial
information included in the report, fairly present in all material respects the
financial condition, results of operations and cash flows of the issuer as of,
and for, the periods presented in the report.

October 31, 2002


                                       By: /s/ Richard A. Heddleson
                                          --------------------------------------
                                          Richard A. Heddleson,
                                          Chief Executive Officer and
                                          Chief Financial Officer



                                       23
<PAGE>

                                  EXHIBIT INDEX

<Table>
<Caption>
         Exhibit Number                         Description
         --------------                         -----------
<S>                        <C>
                  10.1     First Amendment to Employment Agreement between 3dfx
                           and Richard A. Heddleson.

                  99.1     Certification of Chief Executive Officer and Chief
                           Financial Officer Pursuant to 18 U.S.C. Section 1350,
                           as Adopted Pursuant to Section 906 of the
                           Sarbanes-Oxley Act of 2002 filed herewith.
</Table>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>d00805exv10w1.txt
<DESCRIPTION>1ST AMENDMENT TO EMPLOYMENT AGREEMENT: R HEDDLESON
<TEXT>
<PAGE>
                                                                    EXHIBIT 10.1

                                 FIRST AMENDMENT
                                       TO
                              EMPLOYMENT AGREEMENT

                  This First Amendment (this "Amendment") to the Employment
Agreement (the "Agreement"), dated as of April 19, 2001, by and between 3dfx
Interactive, Inc., a California corporation (the "Company"), and Richard A.
Heddleson ("Executive"), is made and entered into this 14th day of October,
2002. Capitalized terms used but not defined herein shall have the meanings
ascribed to those terms in the Agreement.

                  WHEREAS, Executive has provided services to the Company under
the Agreement, originally serving as Chief Financial Officer and now serving as
President, Chief Executive Officer, Chief Financial Officer, Secretary and
Treasurer;

                  WHEREAS, pursuant to the Agreement, the Company's most recent
salary payment to Executive was made on April 15, 2002;

                  WHEREAS, Executive has continued to provide services to the
Company and agrees to continue providing services to the Company through the
date of the Company's eventual dissolution and liquidation, provided the Company
pays Executive an annual salary of $206,250, commencing April 16, 2002 and
thereafter through the date of the Company's dissolution and liquidation;

                  WHEREAS, Executive has incurred expenses on behalf of the
Company for which the Company is obligated to reimburse Executive; and

                  NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

         A. Amendment to Section 1(a). The first sentence of Section 1(a) is
hereby amended in its entirety to read as follows:

                  "For the term of his employment under this Agreement, the
                  Company agrees to employ Executive as its President, Chief
                  Executive Officer, Chief Financial Officer, Secretary and
                  Treasurer reporting directly to the Board of Directors of the
                  Company."

         B. Amendment to Section 1(b). The first sentence of Section 1(b) is
hereby amended in its entirety to read as follows:

                  "During the Employment Period, Executive shall devote such
                  time and energy to the affairs of the Company as is necessary
                  to fulfill the responsibilities of the offices he holds and as
                  the affairs of the Company shall dictate, and Executive shall
                  not be engaged in any competitive business activity without
                  the express written consent of the Board."



<PAGE>

         C. Amendment to Section 3(a). Section 3(a) of the Agreement is hereby
amended in its entirety to read as follows:

                  "Salary. The Company shall pay Executive as salary
                  compensation for his services of Two Hundred Six Thousand Two
                  Hundred Fifty Dollars ($206,250) per annum ("Base Salary
                  Amount"), less applicable deductions and withholdings,
                  commencing April 16, 2002 and thereafter through the date of
                  the Company's dissolution and liquidation (the "Base Salary
                  Amount"); provided, that in the event that Executive spends
                  less than twenty hours per week engaged in addressing the
                  Company's affairs for three or more consecutive calendar
                  weeks, then the Base Salary Amount shall be adjusted
                  accordingly. The Base Salary Amount shall be paid twice
                  monthly on the first and fifteenth day of each month (or, if
                  such day is not a business day, then the immediately preceding
                  business day)."

         D. Addition of Section 3(c). A new Section 3(c) shall be added to the
Agreement, as follows:

                  "(c) Retention Incentive Bonus. In the event the Company
                  becomes a debtor under the United States Bankruptcy Code,
                  Executive shall become entitled to earn additional
                  compensation in the form of a retention incentive bonus equal
                  to one and one-half percent (1 1/2%) of the fair market value
                  of all assets actually collected by the Company
                  post-bankruptcy petition, which bonus shall be paid as an
                  administrative expense of the Company's bankruptcy estate and
                  shall be subject to the approval of the Bankruptcy Court;
                  provided that, subject to Section 4(a)(iv) hereof, Executive
                  shall only be entitled to a retention incentive bonus to the
                  extent that Executive is employed by the Company at the time
                  of the actual collection of such assets. Executive's right to
                  the retention incentive bonus will attach at the time such
                  assets are actually collected by the Company. It is not
                  necessary, however, that Executive be employed by the Company
                  at the time Executive applies for Bankruptcy Court approval of
                  the retention incentive bonus."

         E. Amendment to Section 4(a). Section 4(a) of the Agreement is hereby
amended by adding a new clause (iv) thereto, as follows:

                  "(iv) the retention incentive bonus amount provided for under
                  Section 3(c) of the Agreement as if he continued to be
                  employed by the Company through the date of collection by the
                  Company of all assets."

         F. Full Force and Effect. Except as expressly amended herein, all other
terms and provisions of the Agreement shall remain in full force and effect and
are hereby ratified and confirmed in all respects.



<PAGE>
         G. Past Due Expenses. The Company and Heddleson mutually acknowledge
and agree that as of the date hereof and in accordance with Section 3(d) of the
Agreement, the Company is currently obligated to reimburse certain business
expenses incurred by Executive in the amount of $25,000.

         H. Counterparts. This Amendment may be executed in one or more
counterparts, each of which such counterparts shall be deemed an original and
all of which together shall constitute one and the same Amendment.

                  IN WITNESS WHEREOF, the undersigned have duly executed this
First Amendment to the Agreement as of the date first written above.



                                       /s/ Richard A. Heddleson
                                       -----------------------------------------
                                       Richard A. Heddleson

                                       3DFX INTERACTIVE, INC.,
                                       a California corporation


                                       By: /s/ Gordon A. Campbell
                                          --------------------------------------
                                       Name:  Gordon A. Campbell
                                       Title: Chairman of the Board of Directors


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>4
<FILENAME>d00805exv99w1.txt
<DESCRIPTION>CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
<TEXT>
<PAGE>
                                                                    EXHIBIT 99.1

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of 3dfx Interactive, Inc. (the Company)
on Form 10-Q for the period ending July 31, 2002 as filed with the Securities
and Exchange Commission on the date hereof (the Report), I, Richard A.
Heddleson, Chief Executive Officer and Chief Financial Officer of the Company,
certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002, that:

          (1) The Report fully complies with the requirements of section 13(a)
or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C.78m or 78o(d)), except
as to the timeliness of the filing of the Report; and

          (2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of the
Company.



/s/ Richard A. Heddleson
------------------------

Richard A. Heddleson
Chief Executive Officer and
Chief Financial Officer
October 31, 2002

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