Exhibit 10.04

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CADENCE DESIGN SYSTEMS, INC.

NONSTATUTORY STOCK OPTION AGREEMENT – INITIAL GRANT

Amended and Restated 2000 Equity Incentive Plan (“Plan”)

Cadence Design Systems, Inc. (the “Company”), pursuant to the Plan, hereby
grants you an option (your “Option”) to purchase the number of shares of the
Company’s Common Stock set forth below on the terms set forth in this
Nonstatutory Stock Option Agreement (“Option Agreement”) and the Nonstatutory
Stock Option Terms (“Option Terms”), including any country-specific terms and
conditions contained in the appendix (“Appendix”) attached thereto
(collectively, the Option Agreement, the Option Terms and the Appendix are
referred to herein as this “Agreement”). Your Option is also subject to the
terms and conditions set forth in the Plan and the Notice of Exercise located on
the Employee Stock Services Website (located at http://ess.cadence.com).

 

Optionholder:       ID Number:       Nonstatutory Stock Option Grant Number:   
   Date of Grant:       Vesting Commencement Date:       Number of Shares
Subject to Option:       Exercise Price Per Share:       Expiration Date:      

 

Vesting Schedule:   
1/4th of the shares vests one year after the VestingCommencementDate.    1/48th
of the shares vests monthly thereafter over the next three years.

Shares become exercisable as they vest.

Payment:

   By one or a combination of the following (described in the Option Terms):   
            By cash or check                Pursuant to a Regulation T Program
or other
            “cashless” exercise program (unless otherwise provided in the Appendix)

Acceptance: If you do not notify the Company to the contrary within 30 days of
the date of this Agreement noted below, you will be deemed to have (i) received
a copy of, and reviewed the terms and conditions contained in this Option
Agreement, the Option Terms (including any country-specific terms contained in
the Appendix), the Plan and the Notice of Exercise, (ii) accepted your Option,
including the terms and conditions set forth in these documents, and
(iii) agreed that as of the Date of Grant, these documents set forth the entire
understanding between you and the Company regarding the acquisition of stock in
the Company and supersede all prior oral and written agreements on that subject
with the exception of (A) options previously granted and delivered to you and
(B) rights to purchase stock under the Company’s Employee Stock Purchase Plan.

Rejection: If you do not wish to accept your Option, including the terms and
conditions of this Agreement, you must notify the Company via e-mail to
rusty@cadence.com within 30 days after the date of this Agreement noted below.
Within two business days after your email, you will receive a return e-mail from
Stock Administration confirming your rejection of your Option and the terms and
conditions of this Option Agreement. If a confirmation is not received within
two business days, call 408-944-7712. You must ensure that you receive
confirmation of your rejection, or you will be deemed to have accepted your
Option and the terms and conditions of this Agreement. By notifying the Company
that you do not accept your Option, including the terms and conditions of this
Agreement, you will be electing to refuse the grant.

 

CADENCE DESIGN SYSTEMS, INC. By:     [NAME]  

 

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CADENCE DESIGN SYSTEMS, INC.

NONSTATUTORY STOCK OPTION TERMS

INITIAL AND SUBSEQUENT GRANTS

Amended and Restated 2000 Equity Incentive Plan

Pursuant to your Nonstatutory Stock Option Agreement (“Agreement”) and these
Nonstatutory Stock Option Terms (“Option Terms”), including the country-specific
terms and conditions contained in the appendix (the “Appendix”) attached hereto
(collectively, this “Option Agreement”), CADENCE DESIGN SYSTEMS, INC., a
Delaware corporation (the “Company”) has granted you an option (your “Option”)
under its Amended and Restated 2000 Equity Incentive Plan (the “Plan”) to
purchase the number of shares of the Company’s Common Stock (“Shares”) indicated
in your Agreement at the exercise price indicated in your Agreement. The Plan is
incorporated herein by reference. Defined terms not explicitly defined in this
Option Agreement but defined in the Plan shall have the meaning ascribed to such
terms in the Plan.

The details of your Option are as follows:

1. Nature of Your Option. Your Option is a nonstatutory stock option and is not
intended to qualify as an incentive stock option as defined in Section 422 of
the Code.

2. Exercise of Option. Your Option shall be exercisable during its term in
accordance with this Option Agreement and the Plan as follows:

a. Vesting; Right to Exercise. Subject to the limitations contained herein, your
Option will vest and be exercisable as provided in this Agreement.

i. Your Option may not be exercised for a fraction of a Share.

ii. In the event of your death, disability or other termination of your
Continuous Service, the exercisability of your Option is governed by the Plan
and Sections 5, 6 and 7 below.

iii. If your Continuous Service is not considered interrupted in the case of a
leave of absence, then unless otherwise designated by the Company or required by
law, the period of the leave of absence shall not be treated as service for the
purpose of vesting (that is, the Shares shall not vest during the period of the
leave of absence but your Option shall remain exercisable to the extent that the
Shares were vested at the time that the leave of absence commenced).

b. Method of Exercise. Your Option shall be exercisable in accordance with the
procedures set forth on the Company’s Employee Stock Services website located
at: http://ess.cadence.com.

c. Withholding Taxes. Regardless of any action the Company or your employer
takes with respect to any or all income tax, social insurance, payroll tax,
payment on account or other tax-related items related to the your participation
in the Plan and legally

 

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applicable to you (“Tax-Related Items”), you acknowledge that the ultimate
liability for all Tax-Related Items is and remains your responsibility and may
exceed the amount actually withheld by the Company or your employer. You further
acknowledge that the Company and/or your employer (i) make no representations or
undertakings regarding the treatment of any Tax-Related Items in connection with
any aspect of your Option, including, but not limited to, the grant, vesting or
exercise of your Option, the subsequent sale of Shares acquired pursuant to such
exercise or the receipt of any dividends; and (ii) do not commit to and are
under no obligation to structure the terms of the grant or any aspect of your
Option to reduce or eliminate your liability for Tax-Related Items or achieve
any particular tax result. Further, if you have become subject to tax in more
than one jurisdiction between the Date of Grant and the date of any relevant
taxable or tax withholding event, as applicable, you acknowledge that the
Company and/or your employer (or former employer, as applicable) may be required
to withhold or account for Tax-Related Items in more than one jurisdiction.

Prior to the relevant taxable or tax withholding event, as applicable, you agree
to pay or make adequate arrangements satisfactory to the Company and/or your
employer to satisfy all Tax-Related Items. In this regard, you authorize the
Company and/or your employer, or their respective agents, at their discretion,
to satisfy the obligations with regard to all Tax-Related Items by one or a
combination of the following: (i) withholding from wages or other cash
compensation paid to you by the Company and/or your employer; or
(ii) withholding from proceeds of the sale of Shares acquired at exercise of the
Option either through a voluntary sale or through a mandatory sale arranged by
the Company (on your behalf pursuant to this authorization).

To avoid any negative accounting treatment, the Company may withhold or account
for Tax-Related Items by considering applicable minimum statutory withholding
amounts or other applicable withholding rates.

Finally, you agree to pay to the Company or your employer any amount of
Tax-Related Items that the Company or your employer may be required to withhold
or account for as a result of your participation in the Plan that cannot be
satisfied by the means previously described. The Company may refuse to issue or
deliver the Shares or the proceeds of the sale of Shares if you fail to comply
with your obligations in connection with the Tax-Related Items.

3. Method of Payment. Payment of the exercise price shall be made as follows:
(i) by cash or check; (ii) by delivery of an irrevocable written commitment from
a broker-dealer approved by the Company to deliver the exercise price directly
to the Company upon receipt of the Shares or, in the case of a margin loan, upon
receipt of a copy of the notice of exercise of your Option, or in the case of a
“same day sale” program developed under Regulation T as promulgated by the
Federal Reserve Board which, prior to the issuance of the Shares, results in the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the exercise price to the Company from the sales proceeds;
or (iii) by a combination of the methods of payment permitted by (i) through
(ii) above.

4. Restrictions on Exercise. Your Option may not be exercised unless such
exercise, the issuance of the Shares upon such exercise and the method of
payment of

 

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consideration for the Shares are in compliance with (i) the Securities Act;
(ii) all applicable state and foreign securities laws; (iii) all other
applicable federal, state and foreign laws and regulations; and (iv) the rules
of any stock exchange or national market system upon which the Shares may then
be listed, as such laws, regulations and rules are in effect on the date of
exercise. As a condition to the exercise of your Option, the Company may require
you to make any representation and warranty to the Company as may be required by
any applicable law or regulation.

5. Termination of Continuous Service. If your Continuous Service ends, you may,
but only within three (3) months after the date you cease to be an Employee or
Consultant, exercise your Option to the extent that you were entitled to
exercise it on the date of such termination. To the extent that you were not
entitled to exercise your Option on the date of such termination, or if you do
not exercise your Option within the time specified herein, your Option shall
terminate. If during any part of such three (3) month period you may not
exercise your Option solely because of the conditions set forth in Section 4
above, then your Option will not expire until the earlier of the Expiration Date
set forth in this Agreement or until your Option shall have been exercisable for
an aggregate period of three (3) months after your termination of Continuous
Service. Subject to Section 9 hereof, if your Continuous Service ends during a
Company “blackout” period when trading in Company stock is prohibited, then the
three (3) month period after your termination of Continuous Service shall be
extended by the period of time that you were unable to trade in the Company’s
stock after you ceased to be an Employee or Consultant. For purposes of the
Option Agreement, your Continuous Service is considered terminated effective as
of the date that your status as an Employee or Consultant terminates, with such
date being as of the end of any notice period mandated under local law or
provided for in your employment agreement (if applicable). The Board shall have
the exclusive discretion to determine when your Continuous Service terminates
for purposes of your Option.

6. Death of Optionholder. Subject to Section 9 hereof, in the event of your
death during the term of your Option and while an Employee or Consultant and
having been in Continuous Service since the Date of Grant, your Option may be
exercised, at any time within twelve (12) months following the date of death, by
your estate or by a person who acquired the right to exercise your Option by
bequest or inheritance. To the extent that you were not entitled to exercise
your Option on such date, or if your Option is not exercised within the time
specified herein, your Option shall terminate.

7. Disability of Optionholder. Subject to Section 9 hereof, in the event of your
disability during the term of your Option and while an Employee or Consultant
and having been in Continuous Service since the Date of Grant, your Option may
be exercised, at any time within twelve (12) months following the date you cease
to be an Employee or Consultant, by you to the extent that you were entitled to
exercise it at the date that you cease to be an Employee or Consultant. To the
extent that you were not entitled to exercise your Option on such date, or if
you do not exercise your Option within the time specified herein, your Option
shall terminate.

8. Non-Transferability of Option. Your Option may not be transferred in any
manner otherwise than by will or by the laws of descent and distribution and may
be exercised during your lifetime only by you. The terms of your Option shall be
binding upon your executors, administrators, heirs, successors and assigns.

 

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9. Term of Option. Notwithstanding any provision hereof to the contrary, your
Option may not be exercised after the date that is seven (7) years after the
Date of Grant (the “Expiration Date”), as set forth in this Agreement.

10. No Rights to Continued Employment or Service. Nothing in the Plan or this
Option Agreement shall confer upon you any right to continue in the employ of
the Company or any of its Affiliates (or to continue acting as a Consultant) or
shall affect the right of the Company or its Affiliates to terminate your
employment or the right to terminate your relationship as a Consultant pursuant
to the terms of your consultant agreement with the Company or its Affiliates.

11. Nature of Grant. In accepting your Option, you acknowledge, understand and
agree that:

a. the Plan is established voluntarily by the Company, it is discretionary in
nature, and may be amended, suspended or terminated by the Company at any time;

b. the grant of your Option is voluntary and occasional and does not create any
contractual or other right to receive future grants of options, or benefits in
lieu of options, even if options have been granted repeatedly in the past;

c. all decisions with respect to future option grants, if any, will be at the
sole discretion of the Company;

d. you are voluntarily participating in the Plan;

e. your Option and any Shares acquired under the Plan are not part of normal or
expected compensation or salary for any purposes, including, but not limited to,
calculating any severance, resignation, termination, redundancy, dismissal, end
of service payments, bonuses, long-service awards, pension or retirement or
welfare benefits or similar payments and in no event should be considered as
compensation for, or relating in any way to, past services for the Company or
any of its Affiliates;

f. your Option grant and your participation in the Plan will not be interpreted
to form an employment or service contract or relationship with the Company, your
employer or any Affiliate;

g. the future value of the Shares underlying your Option is unknown and cannot
be predicted with certainty;

h. if the underlying Shares do not increase in value, your Option will have no
value;

 

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i. if you exercise your Option and acquire Shares, the value of such Shares may
increase or decrease in value, even below the exercise price;

j. if you reside outside the United States, the following additional provisions
shall apply:

i. your Option and any Shares acquired under the Plan are not intended to
replace any pension rights or compensation;

ii. your Option and any Shares acquired under the Plan are extraordinary items
that do not constitute compensation of any kind for services of any kind
rendered to the Company or any of its Affiliates that is outside the scope of
your employment or service contract, if any; and

iii. no claim or entitlement to compensation or damages shall arise from
forfeiture of your Option resulting from termination of your Continuous Service
by the Company or your employer (for any reason whatsoever and whether or not in
breach of local labor laws and whether or not later to be found invalid) and in
consideration of the grant of your Option to which you are otherwise not
entitled, you irrevocably agree never to institute any claim against the Company
or any of its Affiliates, waive your ability, if any, to bring any such claim,
and release the Company and any of its Affiliates from any such claim; if,
notwithstanding the foregoing, any such claim is allowed by a court of competent
jurisdiction, then, by participating in the Plan, you shall be deemed
irrevocably to have agreed not to pursue such claim and agree to execute any and
all documents necessary to request dismissal or withdrawal of such claims.

12. No Advice Regarding Grant. The Company is not providing any tax, legal or
financial advice, nor is the Company making any recommendations regarding your
participation in the Plan, or your acquisition or sale of the underlying Shares.
You are hereby advised to consult with your own personal tax, legal and
financial advisors regarding your participation in the Plan before taking any
action related to the Plan.

13. Data Privacy. This Section 13 applies if you reside outside of the United
States:

You hereby explicitly and unambiguously consent to the collection, use and
transfer, in electronic or other form, of your personal data as described in the
Option Agreement and any other Option grant materials by and among, as
applicable, your employer, the Company and its Affiliates for the exclusive
purpose of implementing, administering and managing your participation in the
Plan.

You understand that the Company and your employer may hold certain personal
information about you, including, but not limited to, your name, home address
and telephone number, date of birth, social insurance number or other
identification number, salary, nationality, job title, any Shares or
directorships held in the Company, details of all options or any other
entitlement to Shares awarded, canceled, exercised, vested, unvested or
outstanding in your favor, for the exclusive purpose of implementing,
administering and managing the Plan (“Data”).

 

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You understand that Data will be transferred to such other stock plan service
provider as may be selected by the Company that assists the Company with the
implementation, administration and management of the Plan. You understand that
the recipients of the Data may be located in the United States or elsewhere, and
that the recipient’s country (e.g., the United States) may have different data
privacy laws and protections than your country. You understand that you may
request a list with the names and addresses of any potential recipients of the
Data by contacting your local human resources representative. You authorize the
Company, the stock plan service provider, and any other possible recipients
which may assist the Company (presently or in the future) with implementing,
administering and managing the Plan to receive, possess, use, retain and
transfer the Data, in electronic or other form, for the purpose of implementing,
administering and managing your participation in the Plan. You understand that
Data will be held only as long as is necessary to implement, administer and
manage your participation in the Plan. You understand that you may, at any time,
view Data, request additional information about the storage and processing of
Data, require any necessary amendments to Data or refuse or withdraw the
consents herein, in any case without cost, by contacting in writing your local
human resources representative. You understand, however, that refusing or
withdrawing your consent may affect your ability to participate in the Plan. For
more information on the consequences of your refusal to consent or withdrawal of
consent, you understand that you may contact your local human resources
representative.

14. Governing Law; Venue. This Option Agreement shall be construed, interpreted
and enforced in accordance with the laws of the State of Delaware, without
regard to its conflict of laws rules. For purposes of litigating any dispute
that arises directly or indirectly from the relationship of the parties
evidenced by this grant or this Option Agreement, the parties hereby submit to
and consent to the exclusive jurisdiction of the State of California and agree
that such litigation shall be conducted only in the courts of Santa Clara
County, California, or the federal courts for the United States for the Northern
District of California, and no other courts, where this grant is made and/or to
be performed.

15. Electronic Delivery. The Company may, in its sole discretion, decide to
deliver any documents related to current or future participation in the Plan by
electronic means. You hereby consent to receive such documents by electronic
delivery and agree to participate in the Plan through an on-line or electronic
system established and maintained by the Company or a third party designated by
the Company.

16. Language. If you have received this Option Agreement, or any other document
related to your Option and/or the Plan translated into a language other than
English and if the meaning of the translated version is different than the
English version, the English version will control.

17. Severability. The provisions of this Option Agreement are severable and if
any one or more provisions are determined to be illegal or otherwise
unenforceable, in whole or in part, the remaining provisions shall nevertheless
be binding and enforceable.

18. Appendix. Your Option shall be subject to any special provisions set forth
in the Appendix for your country of residence, if any. If you relocate to one of
the countries included

 

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in the Appendix during the life of the Option, the special provisions for such
country shall apply to you to the extent the Company determines that the
application of such provisions is necessary or advisable in order to comply with
local law or facilitate the administration of the Plan. The Appendix constitutes
part of this Option Agreement.

19. Imposition of Other Requirements. The Company reserves the right to impose
other requirements on your Option and the Shares purchased upon exercise of your
Option, to the extent the Company determines it is necessary or advisable in
order to comply with local laws or facilitate the administration of the Plan,
and to require you to sign any additional agreements or undertakings that may be
necessary to accomplish the foregoing.

ACCEPTANCE

By executing this Agreement, you represent that you are familiar with the terms
and provisions of the Plan and accept your Option subject to all of the terms
and provisions thereof. You hereby agree to accept as binding, conclusive and
final all decisions or interpretations of the Board upon any questions arising
under the Plan. You acknowledge that there may be adverse tax consequences upon
exercise of your Option or disposition of the Shares and that you should consult
a tax adviser prior to such exercise or disposition.

 

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APPENDIX

The additional terms and conditions set forth below are specifically
incorporated into your Nonstatutory Stock Option Agreement (the “Agreement”) and
the Nonstatutory Stock Option Terms (the “Option Terms”) (together, this
Agreement, the Option Terms and this Appendix are referred to herein as this
“Option Agreement”). These terms and conditions govern your Option if you reside
in one of the countries listed below. Capitalized terms used but not defined in
this Appendix shall have the meanings set forth in the Plan and/or the Option
Terms.

This Appendix may also include notifications regarding exchange control, tax and
certain other issues of which you should be aware with respect to your
participation in the Plan. The notifications are based on the securities,
exchange control, income tax and other laws in effect in the respective
countries as of June 2011. Such laws are often complex and change frequently. As
a result, the Company strongly recommends that you not rely on the information
noted herein as the only source of information relating to the consequences of
participation in the Plan because the information may be out of date when your
Option is exercised or Shares acquired under the Plan subsequently are sold. In
addition, the notifications are general in nature and may not apply to your
individual situation, and the Company is not in a position to assure you of any
particular result. Therefore, you are advised to seek appropriate professional
advice as to how the relevant laws in your country may apply to your individual
situation.

Finally, if you are a citizen or resident of a country other than that in which
you are currently working, are considered a resident of a country other than
that in which you are currently working for local law purposes or transfer
employment to another country after the Options are granted, the information
contained herein may not be applicable to you in the same manner. In addition,
the Company shall, in its discretion, determine to what extent the terms and
conditions contained herein shall be applicable to you under these
circumstances.

CANADA

Manner of Exercising Option. Notwithstanding Section 8(b) of the Plan, you are
prohibited from tendering Shares that you already own or attesting to the
ownership of Shares to pay the exercise price or any Tax-Related Items in
connection with your Option.

The following terms and conditions are applicable to residents of Quebec:

Data Privacy Notice and Consent. This provision supplements Section 13 of the
Option Terms:

You hereby authorize the Company and the Company’s representatives to discuss
with and obtain all relevant information from all personnel, professional or
not, involved in the administration and operation of the Plan. You further
authorize the Company, its Affiliates and

 

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the plan administrator to disclose and discuss the Plan with their respective
advisors. You further authorize the Company and its Affiliates to record such
information and to keep such information in your employee file.

French Language Provision. The parties acknowledge that it is their express wish
that this Option Agreement, as well as all documents, notices and legal
proceedings entered into, given or instituted pursuant hereto or relating
directly or indirectly hereto, be drawn up in English.

Les parties reconnaissent avoir exigé la redaction en anglais de cette
convention (“Option Agreement”), ainsi que de tous documents exécutés, avis
donnés et procedures judiciaries intentées, directement ou indirectement,
relativement à la présente convention.

CHINA

The following provisions govern your participation in the Plan if you are a
national of the People’s Republic of China resident in mainland China:

Method of Exercise. Due to regulatory requirements, you will be restricted to
the cashless sell-all method of exercise with respect to your Option. To
complete a cashless sell-all exercise, you understand that you need to instruct
the broker to immediately sell all of the Shares issued upon exercise of your
Option and use the proceeds to pay the exercise price, brokerage fees and any
applicable Tax-Related Items. In the event of changes in regulatory
requirements, the Company reserves the right to eliminate the cashless sell-all
method of exercise requirement and, in its sole discretion, to permit a cash
exercise or cashless sell-to-cover exercise.

Termination of Continuous Service. Further, notwithstanding any terms or
conditions of the Plan or this Option Agreement to the contrary, you understand
and agree that upon termination of your Continuous Service for any reason,
including death or disability, you will be permitted to exercise your Option for
the shorter of (i) the post-termination exercise period (if any) set forth in
this Option Agreement and (ii) six (6) months following the date of termination
of your Continuous Service, or within any other such time frame as may be
required by the State Administration of Foreign Exchange, provided that in no
event will you be permitted to exercise your Option after the Expiration Date.

Exchange Control Notification. You understand and agree that, pursuant to local
exchange control requirements, you will be required to immediately repatriate
the proceeds from the sale of Shares acquired upon exercise of your Option to
China. You understand that, under local law, such repatriation of your cash
proceeds will need to be effected through a special exchange control account
established by the Company or an Affiliate and you hereby consent and agree that
any proceeds from the sale of any Shares you acquire may be transferred to such
special account prior to being delivered to you. Proceeds may be paid in U.S.
dollars or local currency at the Company’s discretion. If the proceeds are paid
in U.S. dollars, you understand that you may be required to set up a U.S. dollar
bank account in China so that the proceeds may be deposited into this account.
If the proceeds are paid in local currency, the Company is under no

 

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obligation to secure any currency conversion rate, and the Company may face
delays in converting the proceeds to local currency due to exchange control
restrictions in China. You acknowledge and agree that you bear the risk of any
currency conversion rate between the date that your Option is exercised and the
date that the proceeds are converted into local currency. You further agree to
comply with any other requirements that may be imposed by the Company in the
future in order to facilitate compliance with exchange control requirements in
China.

FINLAND

There are no country-specific provisions.

GERMANY

There are no country-specific provisions.

HONG KONG

Securities Law Notice. WARNING: Your Option and Shares acquired upon exercise of
your Option do not constitute a public offering of securities under Hong Kong
law and are available only to employees of the Company and its Affiliates. This
Option Agreement, including this Appendix, the Plan and any other incidental
communication materials that may be distributed to you in connection with your
Option (i) have not been prepared in accordance with and are not intended to
constitute a “prospectus” for a public offering of securities under the
applicable securities legislation in Hong Kong, (ii) have not been reviewed by
any regulatory authority in Hong Kong, and (iii) are intended only for the
personal use of each eligible employee of the Company and may not be distributed
to any other person. If you are in any doubt about any of the contents of this
Option Agreement, the Plan or any other incidental communication materials
distributed to you in connection with your Option, you are advised to obtain
independent professional advice.

Securities Law Information. To facilitate compliance with securities laws in
Hong Kong, in the event that your Option, or a portion thereof, vests and become
exercisable within six (6) months of the Date of Grant, you agree not to sell
the Shares issued upon exercise of the Option prior to the six-month anniversary
of the Date of Grant.

HUNGARY

There are no country-specific provisions.

INDIA

Method of Exercise. This provision supplements Section 3 of the Option Terms:

 

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Due to legal restrictions in India, you understand and agree that you will not
be permitted to pay the exercise price by means of a broker-assisted partial
cashless exercise such that a certain number of Shares subject to your exercised
Option are sold immediately upon exercise and the proceeds of the sale remitted
to the Company to cover the aggregate exercise price and any Tax-Related Items.
The Company reserves the right to provide you with this method of payment in the
future depending on the development of local law.

Repatriation of Sale Proceeds. You understand that you are required to
repatriate any proceeds from the sale of the Shares acquired under the Plan
(including any cash dividends paid thereon) to India and convert such proceeds
into local currency within ninety (90) days of receipt. You will receive a
foreign inward remittance certificate (“FIRC”) from the bank where you deposit
the foreign currency and you should maintain this certificate as evidence of the
repatriation of funds in the event the Reserve Bank of India or your employer
requests proof of repatriation.

IRELAND

Director Notification. If you are a director, shadow director1 or secretary of
an Irish Affiliate of the Company, you are subject to certain notification
requirements under Section 53 of the Companies Act, 1990. Among these
requirements is an obligation to notify the Irish Affiliate in writing within
five (5) business days when you receive an interest (e.g., Options, Shares) in
the Company and the number and class of shares or rights to which the interest
relates. In addition, you must notify the Irish Affiliate within five
(5) business days when you sell Shares acquired under the Plan. This
notification requirement also applies to any rights or Shares acquired by your
spouse or children (under the age of 18).

ISRAEL

Method of Exercise. Due to tax regulations in Israel, you will be restricted to
the cashless sell-all method of exercise with respect to your Option. To
complete a cashless sell-all exercise, you understand that you should instruct
the broker to: (i) sell all of the Shares issued upon exercise of your Option;
(ii) use the proceeds to pay the exercise price, brokerage fees and any
applicable Tax-Related Items; and (iii) remit the balance in cash to you. In the
event of changes in regulatory requirements, the Company reserves the right to
eliminate the cashless sell-all method of exercise requirement and, in its sole
discretion, to permit a cash exercise or cashless sell-to-cover exercise.

ITALY

Method of Exercise. Due to regulatory requirements, you will be restricted to
the cashless sell-all method of exercise with respect to your Option. To
complete a cashless sell-all exercise, you understand that you should instruct
the broker to: (i) sell all of the Shares issued upon exercise of

 

1 

A shadow director is an individual who is not on the board of directors of the
Irish subsidiary but who has sufficient control so that the board of directors
of the Irish subsidiary acts in accordance with the “directions or instructions”
of the individual.

 

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your Option; (ii) use the proceeds to pay the exercise price, brokerage fees and
any applicable Tax-Related Items; and (iii) remit the balance in cash to you. In
the event of changes in regulatory requirements, the Company reserves the right
to eliminate the cashless sell-all method of exercise requirement and, in its
sole discretion, to permit a cash exercise or cashless sell-to-cover exercise.

Data Privacy Notice. This provision replaces Section 13 of this Agreement:

You understand that your employer, the Company and any Affiliate, as a potential
data processor for the Company, may hold certain personal information about you,
including, but not limited to, your name, home address and telephone number,
date of birth, social insurance or other identification number, salary,
nationality, job title, any Shares or directorships held in the Company or any
Affiliate, details of all options, or any other entitlement to Shares awarded,
canceled, exercised, vested, unvested or outstanding in your favor, and that the
Company and your employer will process said data and other data lawfully
received from third party (“Data”) for the exclusive purpose of implementing,
managing and administering the Plan and complying with applicable laws,
regulations and community legislation.

You understand that providing the Company with Data is mandatory for compliance
with laws and is necessary for the performance of the Plan and that your refusal
to provide such Data would make it impossible for the Company to perform its
contractual obligations and may affect your ability to participate in the Plan.
The Controller of personal data processing is Cadence Design Systems, Inc., with
registered offices at 2655 Seely Ave., Building 5, San Jose, California, U.S.A.,
its Representative in Italy for privacy purposes is Cadence Design Systems
S.r.l. with its registered offices at Milanofiori-Strada 7 Palazzo R/3, 20089
Rozzano, Milano, Italy – Attention: Human Resources.

You understand that Data will not be publicized, but it may be accessible by
your employer as the data processor of the Company and within your employer’s
organization by its internal and external personnel in charge of processing.
Furthermore, Data may be transferred to banks, other financial institutions, or
brokers involved in the management and administration of the Plan. You
understand that Data may also be transferred to the independent registered
public accounting firm engaged by the Company, and also to the legitimate
addresses under applicable laws. You further understand that the Company and/or
any Affiliate will transfer Data among themselves as necessary for the purpose
of implementing, administering and managing your participation in the Plan, and
that the Company and/or any subsidiary may each further transfer Data to third
parties assisting the Company in the implementation, administration, and
management of the Plan, including any requisite transfer of Data to a broker or
other third party with whom you may elect to deposit any Shares acquired upon
exercise of your Option. Such recipients may receive, possess, use, retain, and
transfer Data in electronic or other form, for the purposes of implementing,
administering, and managing your participation in the Plan. You understand that
these recipients may be acting as controllers, processors, or persons in charge
of processing, as the case may be, according to applicable privacy laws, and
that they may be located in or outside the European Economic Area, such as in
the United States or elsewhere, in countries that do not provide an adequate
level of data protection as intended under Italian

 

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privacy law. Should the Company exercise its discretion in suspending all
necessary legal obligations connected with the management and administration of
the Plan, it will delete Data as soon as it has completed all the necessary
legal obligations connected with the management and administration of the Plan.

You understand that Data processing related to the purposes specified above
shall take place under automated or non-automated conditions, anonymously when
possible, that comply with the purposes for which Data is collected and with
confidentiality and security provisions, as set forth by applicable laws and
regulations, with specific reference to Legislative Decree no. 196/2003.

The processing activity, including communication, the transfer of Data abroad,
including outside of the European Economic Area, as herein specified and
pursuant to applicable laws and regulations, does not require your consent
thereto, as the processing is necessary to performance of law and contractual
obligations related to implementation, administration, and management of the
Plan. You understand that, pursuant to Section 7 of the Legislative Decree no.
196/2003, you have the right at any moment to, including but not limited to,
obtain confirmation that Data exist or not, access, verify their content, origin
and accuracy, delete, update, integrate, correct, block or terminate, for
legitimate reason, the Data processing. To exercise privacy rights, you should
contact your local human resources representative.

Furthermore, you are aware that Data will not be used for direct-marketing
purposes. In addition, Data provided can be reviewed and questions or complaints
can be addressed by contacting your local human resources representative.

Plan Document Acknowledgment. In accepting your Option, you acknowledge that a
copy of the Plan was made available to you, and that you have reviewed the Plan,
this Agreement, the Option Terms and this Appendix, in their entirety and fully
understand and accept all provisions of these documents accordingly.

You further acknowledge that you have read and specifically and expressly
approve the following provisions of the Option Terms: Exercise of Option,
Withholding Taxes, Termination of Continuous Service, Term of Option, No Rights
to Continued Employment or Service, Nature of Grant, Imposition of Other
Requirements, and the Data Privacy Notice in this Appendix.

JAPAN

There are no country-specific provisions.

NETHERLANDS

Insider-Trading Notification. You should be aware of the Dutch insider-trading
rules, which may impact the sale of Shares acquired upon exercise of your
Option. In particular, you may be prohibited from effectuating certain
transactions involving the Shares if you have insider information about the
Company.

 

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Under Article 5:56 of the Dutch Financial Supervision Act, anyone who has
“insider information” related to an issuing company is prohibited from
effectuating a transaction in securities in or from the Netherlands. “Inside
information” is defined as knowledge of specific information concerning the
issuing company to which the securities relate or the trade in securities issued
by such company, which has not been made public and which, if published, would
reasonably be expected to affect the share price, regardless of the development
of the price. The insider could be any employee of any subsidiary in the
Netherlands who has inside information as described herein.

Given the broad scope of the definition of inside information, certain employees
working at an Affiliate in the Netherlands may have inside information and,
thus, would be prohibited from effectuating a transaction in securities in the
Netherlands at a time when the employee has such inside information.

You are advised to contact your personal legal advisor if you are uncertain as
to whether the insider-trading rules apply to you.

RUSSIA

U.S. Transaction. You understand that this Option Agreement shall be concluded
and become effective only when the executed Agreement is received by the Company
in the United States. Upon exercise of your Option, any Shares to be issued to
you shall be delivered to you through a bank or brokerage account in the United
States. You are not permitted to sell the Shares directly to other Russian legal
entities or individuals.

Securities Law Notification. This Agreement, the Option Terms, this Appendix,
the Plan and any other materials that you may receive regarding participation in
the Plan do not constitute advertising or an offering of securities in Russia.
Absent any requirement under local law, the issuance of securities pursuant to
the Plan has not and will not be registered in Russia; hence, the securities
described in any Plan-related documents may not be used for offering or public
circulation in Russia.

Depending on the development of local regulatory requirements, the Company
reserves the right to restrict the exercise of your Option to the cashless
sell-all method of exercise. If applicable, in order to exercise your Option,
you will be required to instruct your broker to: (i) sell all of the Shares
issued upon exercise of your Option; (ii) use the proceeds to pay the exercise
price, brokerage fees and any applicable Tax-Related Items; and (iii) remit the
balance in cash to you.

Exchange Control Information. In order to perform a cash exercise of your
Option, you are required to remit the funds from a foreign currency account at
an authorized bank in Russia. This requirement does not apply if you use a
cashless method of exercise, as there will be no remittance of funds out of
Russia.

Further, you understand that, you will be required to repatriate any proceeds
from the sale of Shares acquired under the Plan (including any cash dividends
paid thereon) to Russia within a reasonably short period of time following
receipt. The sale proceeds must be initially credited to

 

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you through a foreign currency account at an authorized Bank in Russia. After
the proceeds are initially received in Russia, they may be further remitted to
foreign banks in accordance with Russian exchange control laws. You are
encouraged to contact your personal advisor before remitting your proceeds to
Russia as exchange control requirements may change.

SINGAPORE

Securities Law Information. Your Option is being granted to you pursuant to the
“Qualifying Person” exemption under section 273(1)(f) of the Singapore
Securities and Futures Act (Chapter 289, 2006 Ed.) (“SFA”). The Plan has not
been lodged or registered as a prospectus with the Monetary Authority of
Singapore. You should note that such Option grant is subject to section 257 of
the SFA and you will not be able to make any subsequent sale in Singapore, or
any offer of such subsequent sale of the Shares underlying your Option unless
such sale or offer in Singapore is made pursuant to the exemptions under Part
XIII Division (1) Subdivision (4) (other than section 280) of the SFA (Chapter
289, 2006 Ed.).

Director Notification Obligation. If you are a director, associate director or
shadow director of the Company’s Singapore Affiliate, you are subject to certain
notification requirements under the Singapore Companies Act. Among these
requirements is an obligation to notify the Company’s Singapore Affiliate in
writing when you receive an interest (e.g., an Option or Shares) in the Company
or any Affiliate. In addition, you must notify the Company’s Singapore Affiliate
when you sell Shares or shares of any Affiliate (including when you sell Shares
acquired upon exercise of the Option). These notifications must be made within
two days of acquiring or disposing of any interest in the Company or any
Affiliate. In addition, a notification of your interests in the Company or any
Affiliate must be made within two days of becoming a director.

Insider Trading Information. You should be aware of the Singapore insider
trading rules, which may impact the acquisition or disposal of Shares or rights
to Shares under the Plan. Under the Singapore insider-trading rules, you are
prohibited from selling Shares when you are in possession of information
concerning the Company, which is not generally available and which you knows or
should know will have a material effect on the price of Shares once such
information is generally available.

SOUTH KOREA

Exchange Control Information. To remit funds out of South Korea to exercise your
Option by means of a cash exercise method, you must obtain a confirmation of the
remittance by a foreign exchange bank in South Korea. This is an automatic
procedure, (i.e., the bank does not need to approve the remittance and the
process should not take more than a single day.) You will likely need to present
to the bank processing the transaction supporting documentation evidencing the
nature of the remittance. If you receive US$500,000 or more from the sale of
Shares or the receipt of any cash dividends, Korean exchange control laws
require you to repatriate the proceeds to Korea within 18 months of receipt.

 

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SWEDEN

There are no country-specific provisions.

TAIWAN

There are no country-specific provisions.

UNITED KINGDOM

Tax Withholding. This provision supplements Section 2(c) of the Option Terms:

If payment or withholding of income taxes is not made within ninety (90) days of
the event giving rise to the income tax liability or such other period specified
in Section 222(1)(c) of the U.K. Income Tax (Earnings and Pensions) Act 2003
(the “Due Date”), the amount of any uncollected income tax shall constitute a
loan owed by you to your employer, effective as of the Due Date. You agree that
the loan will bear interest at the then-current official rate of Her Majesty’s
Revenue and Customs (“HMRC”), it shall be immediately due and repayable, and the
Company or your employer may recover it at any time by any of the means set
forth in Section 2(c) of the Option Terms. Notwithstanding the foregoing, if you
are a director or executive officer of the Company (within the meaning of
Section 13(k) of the U.S. Securities and Exchange Act of 1934, as amended), you
shall not be eligible for a loan from the Company to cover the income tax. In
the event you are a director or executive officer of the Company and the income
tax is not collected from or paid by you by the Due Date, the amount of any
uncollected income tax will constitute a benefit to you on which additional
income tax and national insurance contributions (“NICs”) will be payable. You
will be responsible for reporting and paying any income tax and NICs due on this
additional benefit directly to HMRC under the self-assessment regime.

UNITED STATES OF AMERICA

Non-Transferability of Option. This provision supplements Section 8 of the
Option Terms:

If you are an Optionholder residing in and subject to the laws of the United
States, you may designate a third party who, in the event of your death, shall
thereafter be entitled to exercise the Option by delivering written notice to
the Company, in a form satisfactory to the Company.

 

17.