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                                                               EXHIBIT 10.5

                                SUMMIT DESIGN, INC.
                               EMPLOYMENT AGREEMENT


     This agreement (the "Agreement") is entered into as of August 12, 1996,
effective as of such date, between SUMMIT DESIGN, INC., a Delaware
corporation (the "Company") and Larry J. Gerhard ("Gerhard").

1.   EMPLOYMENT AND DUTIES.  The Company hereby employs Gerhard to serve and
perform in the role of President and Chief Executive Officer reporting to the
Board of Directors of the Company (the "Board").  Gerhard agrees to perform
the duties of these positions to the best of his ability, and to devote full
time and attention to the transaction of the Company's business.

2.   TERM.

     (a)  This Agreement shall have a term of four (4) years, unless
terminated in accordance with subsections 2(b) - (f) below.  Both parties
acknowledge that the employment created herein is employment "at will" and
may be terminated with or without cause under the terms stated herein.

     (b)  This Agreement may be immediately terminated by the Board in the
event Gerhard engages or becomes engaged in any criminal practice which the
Board reasonably determines is detrimental or harmful to the good name,
goodwill or reputation of the Company, or which does or could adversely
affect the interests of the Company.  Termination under this subsection 2(b)
shall be "Termination for Cause."

     (c)  This Agreement may be terminated by the Company for Convenience and
by Gerhard for Construction.  In such event, the Company shall pay Gerhard
$25,000.00 per month plus all then-current benefits for twenty-four (24)
months after the date of such termination; provided however, that if Gerhard
accepts full-time employment from another party prior to the expiration of
twenty-four (24) months after such termination, the Company's obligations
under this subsection 2(c) shall immediately terminate.

     (d)  For purposes of subsection 2(c), "Convenience" and "Construction
shall have the following meanings:

          (i)  "Convenience" shall mean termination of this Agreement by the
Company for any reason other than (A) a Termination for Cause or (B) as a
result of Gerhard's death or disability.

          (ii) "Construction" shall mean, without Gerhard's express written
consent, (A) a reduction of Gerhard's duties, authority or responsibilities
relative to Gerhard's duties, authority and responsibilities as in effect
immediately prior to such reduction; (B) a substantial reduction, without
good business reasons, of the facilities and perquisites available to Gerhard
immediately prior to such reduction; (C) a reduction by the Company in
Gerhard's base salary as in effect immediately prior to such reduction; or
(D) a material reduction by the Company in the kind or level of employee
benefits to which Gerhard is entitled immediately prior to such reduction.


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     (e)  In the event of a merger, consolidation or sale of all or
substantially all of the assets of the Company and its subsidiaries, Gerhard
shall serve as President and Chief Executive Officer of the successor
company, and all terms of this Agreement shall apply.  In the event that
Gerhard is not elected to serve in this role and under these terms, then this
Agreement shall automatically terminate on the date of the closing of such
transaction, and Gerhard shall receive $25,000.00 per month, plus all
then-current benefits, for twenty-four (24) months after such date.

     (f)  In the event that Gerhard voluntarily resigns, other than upon a
termination of this Agreement for Construction or disability, prior to the
expiration of the four-year term of this Agreement, this Agreement shall
automatically terminate on the date of such resignation.  Gerhard agrees to
provide to the Board a minimum of three (3) months prior written notice of
any such voluntary resignation.

     (g)  This Agreement shall automatically terminate upon termination of
Gerhard's employment as a result of Gerhard's disability or death.

     (h)  Termination of this Agreement shall not release Gerhard from any
obligations under Sections 2(f) (if applicable), 4, 5, 6 and 7 hereof; or the
Company from any obligations under Sections 2(c) or 2(e) hereof, as
applicable.

3.   COMPENSATION.  In consideration of the services to be performed by
Gerhard, the Company agrees to pay Gerhard compensation consisting of the
following:

     (a)  Base salary of $25,000.00 per month and reviews for change in the
first fiscal quarter of each fiscal year.

     (b)  Annual bonus of $75,000 (commencing and applicable to the year
ended December 31, 1996) payable upon publishing audited annual financial
statements for the year then ended as follows:

          FOR 1996: If, but only if, total revenue for 1996 exceeds $19,600,000
          FOR 1997: If, but only if, total revenue for 1997 exceeds $26,500,000
          FOR 1998 AND THEREAFTER: If, but only if, total revenue for the
          applicable year exceeds the annual revenue target determined by the
          Board in the fourth fiscal quarter of the fiscal year preceding the
          applicable year, based on the Company's annual revenue plan for the
          applicable year and the two highest annual revenue plans proposed
          by financial analysts for such year.

     (c)  An initial grant of an option (the "Initial Option") to purchase up
to 75,000 shares of the Company's common stock ("Stock") at an exercise price
equal to the price to the public of the Stock as set forth on the cover of
the Company's prospectus in connection with its initial public offering
("IPO").  Twenty-five percent (25%) of the shares subject to the Initial


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Option shall vest twelve months after the date of grant and one forty-eighth
(1/48th) of the shares subject to the Initial Option shall vest at the end of
each month thereafter, so that all of the shares subject to the Initial
Option shall be vested four (4) years after the date of grant.

     (d)  All benefits as specified in the Company's handbook and that are in
effect generally for the executive officers of the Company.  These benefits
include 100% medical and dental coverage for Gerhard and his wife and
children under the Company's Blue Cross/Blue Shield plan, disability,
accidental death and dismemberment and life insurance as specified in the
employee handbook, the Company sponsored 401(k) retirement savings plan as
provided to all employees and four (4) weeks vacation per year as specified
in the Employee handbook.  Gerhard shall also be entitled to reimbursement
(including any necessary tax gross up) for plan deductibles and all other
medical/dental expenses not covered under the Company's benefit plans, except
for elective cosmetic surgery.

4.   CONFIDENTIALITY.  Gerhard acknowledges that certain customer lists,
design work, and related information, equipment, computer software, and other
proprietary products and information, whether of a technical or non-technical
nature, including but not limited to schematics, drawings, models,
photographs, sketches, blueprints, printouts, and program listings of the
Company (collectively referred to as "Technology"), were and will be
developed by the Company at great expense and over lengthy periods of time,
are secret and confidential, are unique and constitute the exclusive property
and trade secrets of the Company, and any use or disclosure of such
Technology, except in accordance with and under the provisions of this or any
other written agreements between the parties, would be wrongful and would
cause irreparable injury to the Company.  Gerhard hereby agrees that he will
not, at any time, without the express written consent of the Company,
publish, disclose, or divulge to any person, firm, or corporation, any of the
Technology, nor will Gerhard use, directly or indirectly, for Gerhard's own
benefit or the benefit of any other person, firm, or corporation, any of the
Technology, except in accordance with this Agreement or other written
agreements between the parties.

5.   INVENTIONS.  All original written materials, including without
limitation programs, charts, schematics, drawings, tables, tapes, listings,
and technical documentation, that have been or shall be prepared partially or
solely by Gerhard in connection with employment by the Company shall belong
exclusively to the Company.

6.   RETURN OF DOCUMENTS.  Gerhard acknowledges that all originals and copies
of records, reports, documents, lists, plans, drawings, memoranda, notes, and
other documentation related to the business of the Company or containing any
confidential information of the Company shall be the sole and exclusive
property of the Company, and shall be returned to the Company upon the
termination of Gerhard's employment with the Company for any reason
whatsoever or upon the written request of the Company.

7.   COMPLIANCE.  Gerhard agrees to comply with all of the Company's written
employment policies, guidelines, and procedures as contained in the Company's
employment manual, including revisions and additions thereto.


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8.   INJUNCTION.  In addition to all other legal rights and remedies, the
Company shall be entitled to obtain from any court of competent jurisdiction
preliminary and permanent injunctive relief of any actual or threatened
violation of any term hereof without requirement of bond, as well as an
equitable accounting of all profits or benefits arising out of such violation.

9.   WAIVER. The waiver of either party of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent
breach thereof.

10.  DISPUTES.  The legal relations of the parties hereunder, and all other
matters hereunder, shall be governed by the laws of the State of Delaware.
Unresolved disputes shall be resolved in a court of competent jurisdiction in
Washington County, Oregon, and all parties hereto consent to the jurisdiction
of such court.

10.  BOARD APPROVAL.  The effectiveness of this Agreement shall be subject to
the prior approval of the Board.

11.  ENTIRE AGREEMENT.  This Agreement sets forth the entire agreement
between the parties hereto, and fully supersedes any and all prior agreements
or understandings, written or oral between the parties hereto pertaining to
the subject matter hereof.  No modification of amendment hereof is effective
unless in writing and signed by both parties.


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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

"COMPANY":                         SUMMIT DESIGN, INC.
                                   a Delaware Corporation

                                   By:    /s/ Mark Stevens
                                       ---------------------------------------
                                   Name:      Mark Stevens
                                         -------------------------------------
                                   Title:     Member of the Board of Directors
                                          ------------------------------------


"GERHARD":                              /s/ Larry Gerhard
                                   ---------------------------------------
                                   Larry J. Gerhard



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