Exhibit 10.7

Note:
Information in this document marked with [***] has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.



|               |  |                              
|-------------- |  | -----------------------------
|WELLS FARGO    |  | REVOLVING LINE OF CREDIT NOTE
|               | 
|$15,000,000.00 |  | San Jose, California         
|               |  | October 31, 2008             

FOR VALUE RECEIVED, the undersigned Magma Design Automation, Inc. (Borrower) promises to pay to the order
of WELLS FARGO BANK, NATIONAL ASSOCIATION (Bank) at its office at Santa Clara Valley RCBO, 121 Park Center Plaza, Second Floor, San Jose, CA 95113, or at such other place as the holder hereof may designate, in lawful money of the
United States of America and in immediately available funds, the principal sum of $15,000,000.00, or so much thereof as may be advanced and be outstanding, with interest thereon, to be computed on each advance from the date of its
disbursement as set forth herein.



|1. | DEFINITIONS:
|-- | ------------

As used herein, the following terms shall
have the meanings set forth after each, and any other term defined in this Note shall have the meaning set forth at the place defined:

1.1     Business Day means any day except a Saturday, Sunday or any other day on which commercial banks in California are authorized or required by law to close.

1.2     Fixed Rate Term means a period commencing on a Business Day and continuing for 1, 2 or 3 months, as designated by Borrower,
during which all or a portion of the outstanding principal balance of this Note bears interest determined in relation to LIBOR; provided however, that no Fixed Rate Term may be selected for a principal amount less than $100,000.00; and
provided further, that no Fixed Rate Term shall extend beyond the scheduled maturity date hereof. If any Fixed Rate Term would end on a day which is not a Business Day, then such Fixed Rate Term shall be extended to the next succeeding Business Day.

1.3     LIBOR means the rate per annum (rounded upward, if necessary, to the nearest whole 1/8 of 1%) determined by dividing
Base LIBOR by a percentage equal to 100% less any LIBOR Reserve Percentage.

(a)    Base LIBOR means the rate per
annum for United States dollar deposits quoted by Bank as the Inter-Bank Market Offered Rate, with the understanding that such rate is quoted by Bank for the purpose of calculating effective rates of interest for loans making reference thereto, on
the first day of a Fixed Rate Term for delivery of funds on said date for a period of time approximately equal to the number of days in such Fixed Rate Term and in an amount approximately equal to the principal amount to which such Fixed Rate Term
applies. Borrower understands and agrees that Bank may base its quotation of the Inter-Bank Market Offered Rate upon such offers or other market indicators of the Inter-Bank Market as Bank in its discretion deems appropriate including, but not
limited to, the rate offered for U.S. dollar deposits on the London Inter-Bank Market.

(b)    LIBOR Reserve
Percentage means the reserve percentage prescribed by the Board of Governors of the Federal Reserve System (or any successor) for Eurocurrency Liabilities (as defined in Regulation D of the Federal Reserve Board, as amended),
adjusted by Bank for expected changes in such reserve percentage during the applicable Fixed Rate Term.

1.4     Prime Rate
means at any time the rate of interest most recently announced within Bank at its principal office as its Prime Rate, with the understanding that the Prime Rate is one of Banks base rates and serves as the basis upon which effective rates of
interest are calculated for those loans making reference thereto, and is evidenced by the recording thereof after its announcement in such internal publication or publications as Bank may designate.



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|2. | INTEREST:
|-- | ---------

2.1     Interest.  The
outstanding principal balance of this Note shall bear interest (computed on the basis of a 360-day year, actual days elapsed) either (a) at a fluctuating rate per annum 2.50000% above the Prime Rate in effect from time to time, or
(b) at a fixed rate per annum determined by Bank to be 2.50000% above LIBOR in effect on the first day of the applicable Fixed Rate Term. When interest is determined in relation to the Prime Rate, each change in the rate of interest
hereunder shall become effective on the date each Prime Rate change is announced within Bank. With respect to each LIBOR selection option selected hereunder, Bank is hereby authorized to note the date, principal amount, interest rate and Fixed Rate
Term applicable thereto and any payments made thereon on Banks books and records (either manually or by electronic entry) and/or on any schedule attached to this Note, which notations shall be prima facie evidence of the accuracy of the
information noted.

2.2     Selection of Interest Rate Options.  At any time any portion of this Note bears interest
determined in relation to LIBOR, it may be continued by Borrower at the end of the Fixed Rate Term applicable thereto so that all or a portion thereof bears interest determined in relation to the Prime Rate or to LIBOR for a new Fixed Rate Term
designated by Borrower. At any time any portion of this Note bears interest determined in relation to the Prime Rate, Borrower may convert all or a portion thereof so that it bears interest determined in relation to LIBOR for a Fixed Rate Term
designated by Borrower. At such time as Borrower requests an advance hereunder or wishes to select a LIBOR option for all or a portion of the outstanding principal balance hereof, and at the end of each Fixed Rate Term, Borrower shall give Bank
notice specifying: (a) the interest rate option selected by Borrower; (b) the principal amount subject thereto; and (c) for each LIBOR selection, the length of the applicable Fixed Rate Term. Any such notice may be given by telephone
(or such other electronic method as Bank may permit) so long as, with respect to each LIBOR selection, (i) if requested by Bank, Borrower provides to Bank written confirmation thereof not later than 3 Business Days after such notice is given,
and (ii) such notice is given to Bank prior to 10:00 a.m. on the first day of the Fixed Rate Term, or at a later time during any Business Day if Bank, at its sole option but without obligation to do so, accepts Borrowers notice and
quotes a fixed rate to Borrower. If Borrower does not immediately accept a fixed rate when quoted by Bank, the quoted rate shall expire and any subsequent LIBOR request from Borrower shall be subject to a redetermination by Bank of the applicable
fixed rate. If no specific designation of interest is made at the time any advance is requested hereunder or at the end of any Fixed Rate Term, Borrower shall be deemed to have made a Prime Rate interest selection for such advance or the principal
amount to which such Fixed Rate Term applied.

2.3     Taxes and Regulatory Costs.  Borrower shall pay to Bank immediately
upon demand, in addition to any other amounts due or to become due hereunder, any and all (a) withholdings, interest equalization taxes, stamp taxes or other taxes (except income and franchise taxes) imposed by any domestic or foreign
governmental authority and related in any manner to LIBOR, and (b) future, supplemental, emergency or other changes in the LIBOR Reserve Percentage, assessment rates imposed by the Federal Deposit Insurance Corporation, or similar requirements
or costs imposed by any domestic or foreign governmental authority or resulting from compliance by Bank with any request or directive (whether or not having the force of law) from any central bank or other governmental authority and related in any
manner to LIBOR to the extent they are not included in the calculation of LIBOR. In determining which of the foregoing are attributable to any LIBOR option available to Borrower hereunder, any reasonable allocation made by Bank among its operations
shall be conclusive and binding upon Borrower.

2.4     Payment of Interest.  Interest accrued on this Note shall be
payable on the last day of each month, commencing November 30, 2008.

2.5     Default
Interest.  From and after the maturity date of this Note, or such earlier date as all principal owing hereunder becomes due and payable by acceleration or otherwise, the outstanding principal balance of this Note shall bear interest
until paid in full at an increased rate per annum (computed on the basis of a 360-day year, actual days elapsed) equal to 4% above the rate of interest from time to time applicable to this Note.



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|3. | BORROWING AND REPAYMENT:
|-- | ------------------------

3.1     Borrowing and
Repayment.  Borrower may from time to time during the term of this Note borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions of this Note and of the Credit
Agreement between Borrower and Bank defined below; provided however, that the total outstanding borrowings under this Note shall not at any time exceed the principal amount stated above. The unpaid principal balance of this obligation at any time
shall be the total amounts advanced hereunder by the holder hereof less the amount of principal payments made hereon by or for Borrower, which balance may be endorsed hereon from time to time by the holder. The outstanding principal balance of this
Note shall be due and payable in full on December 31, 2009.

3.2     Advances.  Advances hereunder, to the
total amount of the principal sum available hereunder, may be made by the holder at the oral or written request of (a) Peter Teshima or Greg S. Wagenhoffer, anyone acting alone, who are authorized to request advances and direct the
disposition of any advances until written notice of the revocation of such authority is received by the holder at the office designated above, or (b) any person, with respect to advances deposited to the credit of any deposit account of
Borrower, which advances, when so deposited, shall be conclusively presumed to have been made to or for the benefit of Borrower regardless of the fact that persons other than those authorized to request advances may have authority to draw against
such account. The holder shall have no obligation to determine whether any person requesting an advance is or has been authorized by Borrower.

3.3     Application of Payments.  Each payment made on this Note shall be credited first, to any interest then due and second, to the outstanding principal balance hereof. All payments credited to
principal shall be applied first, to the outstanding principal balance of this Note which bears interest determined in relation to the Prime Rate, if any, and second, to the outstanding principal balance of this Note which bears interest determined
in relation to LIBOR, with such payments applied to the oldest Fixed Rate Term first.



|4. | PREPAYMENT:
|-- | -----------

4.1     Prime Rate.  Borrower
may prepay principal on any portion of this Note which bears interest determined in relation to the Prime Rate at any time, in any amount and without penalty.

4.2     LIBOR.  Borrower may prepay principal on any portion of this Note which bears interest determined in relation to LIBOR at any time and in the minimum amount of $100,000.00; provided
however, that if the outstanding principal balance of such portion of this Note is less than said amount, the minimum prepayment amount shall be the entire outstanding principal balance thereof. In consideration of Bank providing this prepayment
option to Borrower, or if any such portion of this Note shall become due and payable at any time prior to the last day of the Fixed Rate Term applicable thereto by acceleration or otherwise, Borrower shall pay to Bank immediately upon demand a fee
which is the sum of the discounted monthly differences for each month from the month of prepayment through the month in which such Fixed Rate Term matures, calculated as follows for each such month:

(a)    Determine the amount of interest which would have accrued each month on the amount prepaid at the interest rate applicable to
such amount had it remained outstanding until the last day of the Fixed Rate Term applicable thereto.

(b)    Subtract
from the amount determined in (a) above the amount of interest which would have accrued for the same month on the amount prepaid for the remaining term of such Fixed Rate Term at LIBOR in effect on the date of prepayment for new loans made for
such term and in a principal amount equal to the amount prepaid.

(c)    If the result obtained in (b) for any month is
greater than zero, discount that difference by LIBOR used in (b) above.



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Borrower acknowledges that prepayment of such amount may result in Bank incurring additional costs, expenses and/or liabilities,
and that it is difficult to ascertain the full extent of such costs, expenses and/or liabilities. Borrower, therefore, agrees to pay the above-described prepayment fee and agrees that said amount represents a reasonable estimate of the prepayment
costs, expenses and/or liabilities of Bank. If Borrower fails to pay any prepayment fee when due, the amount of such prepayment fee shall thereafter bear interest until paid at a rate per annum 2.000% above the Prime Rate in effect from time
to time (computed on the basis of a 360-day year, actual days elapsed).



|5. | EVENTS OF DEFAULT:
|-- | ------------------

This Note is made pursuant to and is
subject to the terms and conditions of that certain Credit Agreement between Borrower and Bank dated as of October 31, 2008, as amended from time to time (the Credit Agreement). Any default in the payment or performance of
any obligation under this Note, or any defined event of default under the Credit Agreement, shall constitute an Event of Default under this Note.



|6. | MISCELLANEOUS:
|-- | --------------

6.1     Remedies.  Upon the
occurrence of any Event of Default, the holder of this Note, at the holders option, may declare all sums of principal and interest outstanding hereunder to be immediately due and payable without presentment, demand, notice of nonperformance,
notice of protest, protest or notice of dishonor, all of which are expressly waived by Borrower, and the obligation, if any, of the holder to extend any further credit hereunder shall immediately cease and terminate. Borrower shall pay to the holder
immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys fees (to include outside counsel fees and all allocated costs of the holders in-house counsel), expended or
incurred by the holder in connection with the enforcement of the holders rights and/or the collection of any amounts which become due to the holder under this Note, and the prosecution or defense of any action in any way related to this Note,
including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding
(including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.

6.2     Obligations Joint and Several.  Should more than one person or entity sign this Note as a Borrower, the obligations of each such Borrower shall be joint and several.

6.3     Governing Law.  This Note shall be governed by and construed in accordance with the laws of the State of California.

IN WITNESS WHEREOF, the undersigned has executed this Note as of the date first written above.



|                              |  |                                       
|----------------------------- |  | --------------------------------------
|Magma Design Automation, Inc.
|                              | 
|By:                           |  | /s/ Peter Teshima                     
|                              |  | Peter Teshima, Chief Financial Officer
|                              | 
|By:                           |  | /s/ Roy Jewell                        
|                              |  | Roy Jewell, President                 



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|            |  | SECURITY AGREEMENT        
|WELLS FARGO |  | SPECIFIC RIGHTS TO PAYMENT

1.     GRANT OF SECURITY INTEREST.  For valuable consideration, the undersigned Magma
Design Automation, Inc., or any of them (Debtor), hereby grants and transfers to WELLS FARGO BANK, NATIONAL ASSOCIATION (Bank) a security interest in the following accounts, deposit accounts, chattel paper (whether
electronic or tangible), instruments, promissory notes, documents, general intangibles, payment intangibles, software, letter of credit rights, health-care insurance receivables and other rights to payment (collectively called
Collateral):

All funds, including both principal and interest, evidenced by Wells Fargo Bank certificate of deposit #6834998673 dated
11/21/08, and all renewals thereof, whether or not any such renewal is evidenced by a certificate of deposit. The amount of such funds shall at all times be equal to the amount of the Overadvance, as defined in the Credit Agreement dated as
of October 31,2008, by and between Debtor and Bank (as amended or restated from time to time)

and all renewals thereof, including all securities,
guaranties, warranties, indemnity agreements, insurance policies, supporting obligations and other agreements pertaining to the same or the property described therein, together with whatever is receivable or received when any of the Collateral or
proceeds thereof are sold, collected, exchanged or otherwise disposed of, whether such disposition is voluntary or involuntary, including without limitation, all rights to payment, including returned premiums, with respect to any insurance relating
to any of the foregoing, and all rights to payment with respect to any claim or cause of action affecting or relating to any of the foregoing (hereinafter called Proceeds).

2.     OBLIGATIONS SECURED.  The obligations secured hereby are the payment and performance of: (a) all present and future Indebtedness of Debtor to Bank; (b) all obligations of
Debtor and rights of Bank under this Agreement; and (c) all present and future obligations of Debtor to Bank of other kinds. The word Indebtedness is used herein in its most comprehensive sense and includes any and all advances,
debts, obligations and liabilities of Debtor, or any of them, heretofore, now or hereafter made, incurred or created, whether voluntary or involuntary and however arising, whether due or not due, absolute or contingent, liquidated or unliquidated,
determined or undetermined, including under any swap, derivative, foreign exchange, hedge, deposit, treasury management or other similar transaction or arrangement, and whether Debtor may be liable individually or jointly, or whether recovery upon
such Indebtedness may be or hereafter becomes unenforceable.

3.     TERMINATION.  This Agreement will terminate upon the
performance of all obligations of Debtor to Bank, including without limitation, the payment of all Indebtedness of Debtor to Bank, and the termination of all commitments of Bank to extend credit to Debtor, existing at the time Bank receives written
notice from Debtor of the termination of this Agreement.

4.     OBLIGATIONS OF BANK.  Bank has no obligation to make any loans
hereunder. Any money received by Bank in respect of the Collateral may be deposited, at Banks option, into a non-interest bearing account over which Debtor shall have no control, and the same shall, for all purposes, be deemed Collateral
hereunder.

5.     REPRESENTATIONS AND WARRANTIES.  Debtor represents and warrants to Bank that: (a) Debtors legal name
is exactly as set forth on the first page of this Agreement, and all of Debtors organizational documents or agreements delivered to Bank are complete and accurate in every respect; (b) Debtor is the owner and has possession or control of
the Collateral and Proceeds; (c) Debtor has the exclusive right to grant a security interest in the Collateral and Proceeds; (d) all Collateral and Proceeds are genuine, free from liens, adverse claims, setoffs, default, prepayment,
defenses and conditions precedent of any kind or character, except the lien created hereby or as otherwise agreed to by Bank, or heretofore disclosed by Debtor to Bank, in writing; (e) all statements contained herein and, where applicable, in
the Collateral are true and complete in all material respects; (f) no financing statement covering any of the Collateral or Proceeds, and naming any secured party



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other than Bank, is on file in any public office; (g) all persons appearing to be obligated on Collateral and Proceeds have authority and capacity to contract and
are bound as they appear to be; (h) all property subject to chattel paper has been properly registered and filed in compliance with law and to perfect the interest of Debtor in such property; and (i) all Collateral and Proceeds comply with
all applicable laws concerning form, content and manner of preparation and execution, including where applicable Federal Reserve Regulation Z and any State consumer credit laws.

6.     COVENANTS OF DEBTOR.

6.1   Debtor Agrees in general: (a) to pay Indebtedness secured
hereby when due; (b) to indemnify Bank against all losses, claims, demands, liabilities and expenses of every kind caused by property subject hereto; (c) to permit Bank to exercise its powers; (d) to execute and deliver such documents
as Bank deems necessary to create, perfect and continue the security interests contemplated hereby; (e) not to change its name, and as applicable, its chief executive office, its principal residence or the jurisdiction in which it is organized
and/or registered without giving Bank prior written notice thereof; (f) not to change the places where Debtor keeps any Collateral or Debtors records concerning the Collateral and Proceeds without giving Bank prior written notice of the
address to which Debtor is moving same; and (g) to cooperate with Bank in perfecting all security interests granted herein and in obtaining such agreements from third parties as Bank deems necessary, proper or convenient in connection with the
preservation, perfection or enforcement of any of its rights hereunder.

6.2   Debtor agrees with regard to the Collateral and Proceeds, unless Bank
agrees otherwise in writing: (a) that Bank is authorized to file financing statements in the name of Debtor to perfect Banks security interest in Collateral and Proceeds; (b) where applicable, to insure the Collateral with Bank named
as loss payee, in form, substance and amounts, under agreements, against risks and liabilities, and with insurance companies satisfactory to Bank; (c) not to permit any security interest in or lien on the Collateral or Proceeds, except in favor
of Bank; (d) not to sell, hypothecate or otherwise dispose of, nor permit the transfer by operation of law of, any of the Collateral or Proceeds or any interest therein, nor withdraw any funds from any deposit account pledged to Bank hereunder;
(e) to keep, in accordance with generally accepted accounting principles, complete and accurate records regarding all Collateral and Proceeds, and to permit Bank to inspect the same and make copies thereof at any reasonable time; (f) if
requested by Bank, to receive and use reasonable diligence to collect Proceeds, in trust and as the property of Bank, and to immediately endorse as appropriate and deliver such Proceeds to Bank daily in the exact form in which they are received
together with a collection report in form satisfactory to Bank; (g) not to commingle Collateral or Proceeds, or collections thereunder, with other property; (h) in the event Bank elects to receive payments of Collateral or Proceeds
hereunder, to pay all expenses incurred by Bank in connection therewith, including expenses of accounting, correspondence, collection efforts, reporting to account or contract debtors, filing, recording, record keeping and expenses incidental
thereto; and (i) to provide any service and do any other acts which may be necessary to keep all Collateral and Proceeds free and clear of all defenses, rights of offset and counterclaims.

7.     POWERS OF BANK.  Debtor appoints Bank its true attorney-in-fact to perform any of the following powers, which are coupled with an
interest, are irrevocable until termination of this Agreement and may be exercised from time to time by Banks officers and employees, or any of them, whether or not Debtor is in default: (a) to perform any obligation of Debtor hereunder
in Debtors name or otherwise; (b) to give notice to account debtors or others of Banks rights in the Collateral and Proceeds, to enforce or forebear from enforcing the same and make extension or modification agreements with respect
thereto; (c) to release persons liable on Collateral or Proceeds and to give receipts and acquittances and compromise disputes in connection therewith; (d) to release or substitute security; (e) to resort to security in any order;
(f) to prepare, execute, file, record or deliver notes, assignments, schedules, designation statements, financing statements, continuation statements, termination statements, statements of assignment, applications for registration or like
papers to perfect, preserve or release Banks interest in the Collateral and Proceeds; (g) to receive, open and read mail addressed to Debtor; (h) to take cash, instruments for the payment of money and other property to which Bank is
entitled; (i) to verify facts concerning the Collateral and Proceeds by inquiry of obligors thereon, or otherwise, in its own name or a fictitious name; (j) to endorse, collect, deliver and receive payment under instruments for the payment of
money constituting or relating to Proceeds; (k) to prepare, adjust, execute, deliver and receive payment under insurance claims, and to collect and receive payment of and endorse any instrument in payment of loss or returned



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premiums or any other insurance refund or return, and to apply such amounts received by Bank, at Banks sole option, toward repayment of the Indebtedness;
(I) to exercise all rights, powers and remedies which Debtor would have, but for this Agreement, with respect to all Collateral and Proceeds subject hereto; (m) to make withdrawals from and to close deposit accounts or other accounts with
any financial institution, wherever located, into which Proceeds may have been deposited, and to apply funds so withdrawn to payment of the Indebtedness; (n) to preserve or release the interest evidenced by chattel paper to which Bank is
entitled hereunder and to endorse and deliver any evidence of title incidental thereto; and (0) to do all acts and things and execute all documents in the name of Debtor or otherwise, deemed by Bank as necessary, proper and convenient in
connection with the preservation, perfection or enforcement of its rights hereunder.

8.     PAYMENT OF PREMIUMS, TAXES, CHARGES, LIENS AND
ASSESSMENTS.  Debtor agrees to pay, prior to delinquency, all insurance premiums, taxes, charges, liens and assessments against the Collateral and Proceeds, and upon the failure of Debtor to do so, Bank at its option may pay any of them
and shall be the sole judge of the legality or validity thereof and the amount necessary to discharge the same. Any such payments made by Bank shall be obligations of Debtor to Bank, due and payable immediately upon demand, together with interest at
a rate determined in accordance with the provisions of this Agreement, and shall be secured by the Collateral and Proceeds, subject to all terms and conditions of this Agreement.

9.     EVENTS OF DEFAULT.  The occurrence of any of the following shall constitute an Event of Default under this Agreement: (a) any default in the payment or performance of
any obligation, or any defined event of default, under (i) any contract or instrument evidencing any Indebtedness, or (ii) any other agreement between Debtor and Bank, including without limitation any loan agreement, relating to or
executed in connection with any Indebtedness; (b) any representation or warranty made by Debtor herein shall prove to be incorrect, false or misleading in any material respect when made; (c) Debtor shall fail to observe or perform any
obligation or agreement contained herein; (d) any impairment of the rights of Bank in any Collateral or Proceeds or any attachment or like levy on any property of Debtor; and (e) Bank, in good faith, believes any or all of the Collateral
and/or Proceeds to be in danger of misuse, dissipation, commingling, loss, theft, damage or destruction, or otherwise in jeopardy or unsatisfactory in character or value.

10.   REMEDIES.  Upon the occurrence of any Event of Default, Bank shall have the right to declare immediately due and payable all or any Indebtedness secured hereby and to terminate any commitments to make loans or
otherwise extend credit to Debtor. Bank shall have all other rights, powers, privileges and remedies granted to a secured party upon default under the California Uniform Commercial Code or otherwise provided by law, including without limitation, the
right (a) to contact all persons obligated to Debtor on any Collateral or Proceeds and to instruct such persons to deliver all Collateral and/or Proceeds directly to Bank, and (b) to sell, lease, license or otherwise dispose of any or all
Collateral. All rights, powers, privileges and remedies of Bank shall be cumulative. No delay, failure or discontinuance of Bank in exercising any right, power, privilege or remedy hereunder shall affect or operate as a waiver of such right, power,
privilege or remedy; nor shall any single or partial exercise of any such right, power, privilege or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of any other right, power, privilege or remedy. Any
waiver, permit, consent or approval of any kind by Bank of any default hereunder, or any such waiver of any provisions or conditions hereof, must be in writing and shall be effective only to the extent set forth in writing. It is agreed that public
or private sales or other dispositions, for cash or on credit, to a wholesaler or retailer or investor, or user of property of the types subject to this Agreement, or public auctions, are all commercially reasonable since differences in the prices
generally realized in the different kinds of dispositions are ordinarily offset by the differences in the costs and credit risks of such dispositions.

While an
Event of Default exists: (a) Debtor will deliver to Bank from time to time, as requested by Bank, current lists of all Collateral and Proceeds; (b) Debtor will not dispose of any Collateral or Proceeds except on terms approved by Bank;
(c) Bank may, at any time and at Banks sole option, liquidate any time deposits pledged to Bank hereunder and apply the Proceeds thereof to payment of the Indebtedness, whether or not said time deposits have matured and notwithstanding
the fact that such liquidation may give rise to penalties for early withdrawal of funds; and (d) at Banks request, Debtor will assemble and deliver all Collateral and Proceeds, and books and records pertaining thereto, to Bank at a
reasonably convenient place designated by Bank. Debtor further agrees that Bank shall have no obligation to process or prepare any Collateral for sale or other disposition.



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11.   DISPOSITION OF COLLATERAL AND PROCEEDS; TRANSFER OF INDEBTEDNESS.  In disposing of Collateral
hereunder, Bank may disclaim all warranties of title, possession, quiet enjoyment and the like. Any proceeds of any disposition of any Collateral or Proceeds, or any part thereof, may be applied by Bank to the payment of expenses incurred by Bank in
connection with the foregoing, including reasonable attorneys fees, and the balance of such proceeds may be applied by Bank toward the payment of the Indebtedness in such order of application as Bank may from time to time elect. Upon the
transfer of all or any part of the Indebtedness, Bank may transfer all or any part of the Collateral or Proceeds and shall be fully discharged thereafter from all liability and responsibility with respect to any of the foregoing so transferred, and
the transferee shall be vested with all rights and powers of Bank hereunder with respect to any of the foregoing so transferred; but with respect to any Collateral or Proceeds not so transferred Bank shall retain all rights, powers, privileges and
remedies herein given.

12.   STATUTE OF LIMITATIONS.  Until all Indebtedness shall have been paid in full and all commitments by Bank to
extend credit to Debtor have been terminated, the power of sale or other disposition and all other rights, powers, privileges and remedies granted to Bank hereunder shall continue to exist and may be exercised by Bank at any time and from time to
time irrespective of the fact that the Indebtedness or any part thereof may have become barred by any statute of limitations, or that the personal liability of Debtor may have ceased, unless such liability shall have ceased due to the payment in
full of all Indebtedness secured hereunder.

13.   MISCELLANEOUS.  When there is more than one Debtor named herein: (a) the word
Debtor shall mean all or anyone or more of them as the context requires; (b) the obligations of each Debtor hereunder are joint and several; and (c) until all Indebtedness shall have been paid in full, no Debtor shall have any
right of subrogation or contribution, and each Debtor hereby waives any benefit of or right to participate in any of the Collateral or Proceeds or any other security now or hereafter held by Bank. Debtor hereby waives any right to require Bank to
(i) proceed against Debtor or any other person, (ii) marshal assets or proceed against or exhaust any security from Debtor or any other person, (iii) perform any obligation of Debtor with respect to any Collateral or Proceeds, and
(d) make any presentment or demand, or give any notice of nonpayment or nonperformance, protest, notice of protest or notice of dishonor hereunder or in connection with any Collateral or Proceeds. Debtor further waives any right to direct the
application of payments or security for any Indebtedness of Debtor or indebtedness of customers of Debtor.

14.    NOTICES.  All notices,
requests and demands required under this Agreement must be in writing, addressed to Bank at the address specified in any other loan documents entered into between Debtor and Bank and to Debtor at the address of its chief executive office (or
principal residence, if applicable) specified below or to such other address as any party may designate by written notice to each other party, and shall be deemed to have been given or made as follows: (a) if personally delivered, upon
delivery; (b) if sent by mail, upon the earlier of the date of receipt or 3 days after deposit in the U. S. mail, first class and postage prepaid; and (c) if sent by telecopy, upon receipt.

15.   COSTS, EXPENSES AND ATTORNEYS FEES.  Debtor shall pay to Bank immediately upon demand the full amount of all payments, advances, charges,
costs and expenses, including reasonable attorneys fees (to include outside counsel fees and all allocated costs of Banks in-house counsel), expended or incurred by Bank in connection with (a) the perfection and preservation of the
Collateral or Banks interest therein, and (b) the realization, enforcement and exercise of any right, power, privilege or remedy conferred by this Agreement, whether incurred at the trial or appellate level, in an arbitration proceeding
or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating to Debtor or in
any way affecting any of the Collateral or Banks ability to exercise any of its rights or remedies with respect thereto. All of the foregoing shall be paid by Debtor with interest from the date of demand until paid in full at a rate per annum
equal to the greater of ten percent (10%) or Banks Prime Rate in effect from time to time.

16.   SUCCESSORS; ASSIGNS;
AMENDMENT.  This Agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns of the parties, and may be amended or modified only in writing signed by Bank
and Debtor.



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17.   OBLIGATIONS OF MARRIED PERSONS.  Any married person who signs this Agreement as Debtor hereby
expressly agrees that recourse may be had against his or her separate property for all his or her Indebtedness to Bank secured by the Collateral and Proceeds under this Agreement.

18.   SEVERABILITY OF PROVISIONS.  If any provision of this Agreement shall be held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision or any remaining provisions of this Agreement.

19.   GOVERNING
LAW.  This Agreement shall be governed by and construed in accordance with the laws of the State of California.

Debtor warrants that Debtor is an
organization registered under the laws of Delaware.

Debtor warrants that its chief executive office (or principal residence, if applicable) is located at the
following address: 1650 Technology Drive, San Jose, CA 95110

IN WITNESS WHEREOF, this Agreement has been duly executed as of October 31, 2008.



|                              |  |                                       
|----------------------------- |  | --------------------------------------
|Magma Design Automation, Inc.
|                              | 
|By:                           |  | /s/ Peter Teshima                     
|                              |  | Peter Teshima, Chief Financial Officer
|                              | 
|By:                           |  | /s/ Roy Jewell                        
|                              |  | Roy Jewell, President                 



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CREDIT AGREEMENT

THIS CREDIT AGREEMENT (this Agreement) is entered into as of October 31, 2008, by and between MAGMA DESIGN AUTOMATION, INC., a Delaware corporation (Borrower), and WELLS FARGO BANK, NATIONAL ASSOCIATION
(Bank).

RECITALS

Borrower has
requested that Bank extend or continue credit to Borrower as described below, and Bank has agreed to provide such credit to Borrower on the terms and conditions contained herein.

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Bank and Borrower hereby agree as follows:

ARTICLE I

CREDIT TERMS

SECTION 1.1.    LINE OF CREDIT.

(a)     Line of Credit.  Subject to the terms and conditions of this Agreement, Bank hereby agrees to make advances to Borrower from time to time up to and including December 31, 2009, not to
exceed at any time the aggregate principal amount of Fifteen Million Dollars ($15,000,000.00) (Line of Credit), the proceeds of which shall be used first, to refinance Borrowers existing debt with Bank and second, to finance
Borrowers working capital requirement. Borrowers obligation to repay advances under the Line of Credit shall be evidenced by a promissory note dated as of October 31, 2008 (Line of Credit Note), all terms of which are
incorporated herein by this reference.

(b)     Limitation on Borrowings.  Outstanding borrowings and
Letter of Credit liabilities under the Line of Credit (collectively Outstandings), to a maximum of the principal amount set forth above, shall not at any time exceed an aggregate of eighty percent (80%) of Borrowers eligible
accounts receivable (the Borrowing Base) plus an additional amount not to exceed $3,000,000.00. All of the foregoing shall be determined by Bank upon receipt and review of all collateral reports required hereunder and such other
documents and collateral information as Bank may from time to time require. Borrower acknowledges that said borrowing base was established by Bank with the understanding that, among other items, the aggregate of all returns, rebates, discounts,
credits and allowances for the immediately preceding three (3) months at all times shall be less than five percent (5%) of Borrowers gross sales for said period. If such dilution of Borrowers accounts for the immediately
preceding three (3) months at any time exceeds five percent (5%) of Borrowers gross sales for said period, or if there at any time exists any other matters, events, conditions or contingencies which Bank reasonably believes may
affect payment of any portion of Borrowers accounts, Bank, in its sole discretion, may reduce the foregoing advance rate against eligible accounts receivable to a percentage appropriate to reflect such additional dilution and/or establish
additional reserves against Borrowers eligible accounts receivable.

As used herein, eligible accounts receivable shall consist
solely of trade accounts created in the ordinary course of Borrowers business, upon which Borrowers right to receive payment is absolute and not contingent upon the fulfillment of any condition whatsoever, and in which Bank has a
perfected security interest of first priority, and shall not include:

(i)    any account which is unpaid more
than 90 days after invoice date or, if the payment term is less than net 30 days, which is unpaid more than 3 times the payment term;



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(ii)   that portion of any account for which there exists any right of setoff,
defense or discount (except regular discounts allowed in the ordinary course of business to promote prompt payment) or for which any defense or counterclaim has been asserted;

(iii)   any account which represents an obligation of any state or municipal government or of the United States government or any
political subdivision thereof (except accounts which represent obligations of the United States government and for which the assignment provisions of the Federal Assignment of Claims Act, as amended or recodified from time to time, have been
complied with to Banks satisfaction);

(iv)   any account which represents an obligation of an account debtor
located in a foreign country other than an account debtor located in a Canadian province or territory, so long as, in Banks determination, such Canadian jurisdiction recognizes Banks first priority security interest in and right to
collect such account as a consequence of any security agreements and UCC filings in favor of Bank, except to the extent any such account, in Banks determination, is supported by a letter of credit or insured under a policy of foreign credit
insurance, in each case in form, substance and issued by a party acceptable to Bank;

(v)   any account which arises
from the sale or lease to or performance of services for, or represents an obligation of, an employee, affiliate, partner, member, parent or subsidiary of Borrower;

(vi)   that portion of any account, which represents interim or progress billings or retention rights on the part of the account
debtor;

(vii)  any account which represents an obligation of any account debtor when twenty percent (20%) or more of
Borrowers accounts from such account debtor are not eligible pursuant to (i) above;

(viii)  that portion of any
account from an account debtor which represents the amount by which Borrowers total accounts from said account debtor exceeds twenty-five percent (25%) of Borrowers total accounts;

(ix)   any account deemed ineligible by Bank when Bank, in its sole discretion, deems the creditworthiness or financial condition of
the account debtor, or the industry in which the account debtor is engaged, to be unsatisfactory.

The amount by which Outstandings at any time exceed the Borrowing
Base is referred to as the Overadvance.

(c)     Letter of Credit Subfeature.  As a subfeature
under the Line of Credit, Bank agrees from time to time during the term thereof to issue or cause an affiliate to issue standby letters of credit for the account of Borrower (each, a Letter of Credit and collectively, Letters of
Credit); provided however, that the aggregate undrawn amount of all outstanding Letters of Credit shall not at any time exceed Two Million Five Hundred Thousand Dollars ($2,500,000.00). The form



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and substance of each Letter of Credit shall be subject to approval by Bank, in its sole discretion. No Letter of Credit shall have an expiration date subsequent to
the maturity date of the Line of Credit, except existing Letters of Credit numbered 584969 and 587968 for $200,000.00 and $1,500,000.00, respectively, which are deemed to have been issued hereunder. To the extent that the subject Line of Credit
terminates for any reason prior to expiration of Letters of Credit, Borrower shall pledge cash collateral maintained at Bank equal to 100% of the stated amount of all such Letters of Credit. The undrawn amount of all Letters of Credit shall be
reserved under the Line of Credit and shall not be available for borrowings thereunder. Each Letter of Credit shall be subject to the additional terms and conditions of the Letter of Credit agreements, applications and any related documents required
by Bank in connection with the issuance thereof. Each drawing paid under a Letter of Credit shall be deemed an advance under the Line of Credit and shall be repaid by Borrower in accordance with the terms and conditions of this Agreement applicable
to such advances; provided however, that if advances under the Line of Credit are not available, for any reason, at the time any drawing is paid, then Borrower shall immediately pay to Bank the full amount drawn, together with interest thereon from
the date such drawing is paid to the date such amount is fully repaid by Borrower, at the rate of interest applicable to advances under the Line of Credit. In such event Borrower agrees that Bank, in its sole discretion, may debit any account
maintained by Borrower with Bank for the amount of any such drawing.

(d)     Borrowing and
Repayment.  Borrower may from time to time during the term of the Line of Credit borrow, partially or wholly repay its outstanding borrowings, and reborrow, subject to all of the limitations, terms and conditions contained herein or in
the Line of Credit Note; provided however, that the total outstanding borrowings under the Line of Credit shall not at any time exceed the maximum principal amount available thereunder, as set forth above.

SECTION 1.2.    INTEREST/FEES.

(a)     Interest.  The outstanding principal balance of each credit subject hereto shall bear interest at the rate of interest set forth in each promissory note or other instrument or document
executed in connection therewith.

(b)     Computation and Payment.  Interest shall be computed on the
basis of a 360-day year, actual days elapsed. Interest shall be payable at the times and place set forth in each promissory note or other instrument or document required hereby.

(c)     Commitment Fee.  Borrower shall pay to Bank a non-refundable commitment fee for the Line of Credit equal to Ten
Thousand Dollars ($10,000.00), which fee shall be due and payable in full on the date of this Agreement.

(d)     Unused
Commitment Fee.  Borrower shall pay to Bank a fee equal to one-eighth percent (0.125%) per annum (computed on the basis of a 360-day year, actual days elapsed) on the average daily unused amount of the Line of Credit, which fee shall
be calculated on a quarterly basis by Bank and shall be due and payable by Borrower in arrears within ten (10) days after each billing is sent by Bank.

(e)     Letter of Credit Fees.  Borrower shall pay to Bank (i) fees upon the issuance of each Letter of Credit equal to two percent (2.00%) per annum (computed on the basis of a 360-day
year, actual days elapsed) of the face amount thereof, and (ii) fees upon the payment or negotiation of each drawing under any Letter of Credit and fees upon the occurrence of any other activity with respect to any Letter of Credit (including
without limitation, the transfer, amendment or cancellation of any Letter of Credit) determined in accordance with Banks standard fees and charges then in effect for such activity.



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|au#2690 #5564597639                               |  |     | 



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SECTION 1.3.    COLLECTION OF PAYMENTS.  Borrower authorizes Bank to collect all
interest and fees due under each credit subject hereto by charging Borrowers deposit account number 4050-015742 with Bank, or any other deposit account maintained by Borrower with Bank, for the full amount thereof. Should there be insufficient
funds in any such deposit account to pay all such sums when due, the full amount of such deficiency shall be immediately due and payable by Borrower.

SECTION 1.4.    COLLATERAL.

As security for all indebtedness and other obligations of Borrower to Bank subject hereto,
Borrower hereby grants to Bank security interests of first priority in all Borrowers accounts receivable, and other rights to payment, general intangibles, inventory and equipment, provided however that notwithstanding the foregoing, Bank
disclaims a security interest in any of Debtors intellectual property (other than proceeds, accounts, payment intangibles, and other rights to payment related to intellectual property). Notwithstanding the foregoing, the first sentence of
Section 5.6. (entitled Double Negative Pledge) shall continue to apply, subject to the exceptions therein, to all of Borrowers assets, including its intellectual property.

In addition, upon the occurrence of an Overadvance, Borrower shall, within 5 calendar days, establish with and grant to Bank a security interest in a deposit
account with a balance therein at all times equal to the amount of the Overadvance, failing which Borrower shall immediately repay the Overadvance.

All of the foregoing shall be evidenced by and subject to the terms of such security agreements, financing statements, deeds or mortgages, and other documents as Bank shall reasonably require, all in form and substance satisfactory to Bank.
Borrower shall pay to Bank immediately upon demand the full amount of all charges, costs and expenses (to include fees paid to third parties and all allocated costs of Bank personnel), expended or incurred by Bank in connection with any of the
foregoing security, including without limitation, filing and recording fees and costs of appraisals, audits and title insurance.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Borrower
makes the following representations and warranties to Bank, which representations and warranties shall survive the execution of this Agreement and shall continue in full force and effect until the full and final payment, and satisfaction and
discharge, of all obligations of Borrower to Bank subject to this Agreement.

SECTION 2.1.    LEGAL STATUS.  Borrower
is a corporation, duly organized and existing and in good standing under the laws of Delaware, and is qualified or licensed to do business (and is in good standing as a foreign corporation, if applicable) in all jurisdictions in which such
qualification or licensing is required or in which the failure to so qualify or to be so licensed could have a material adverse effect on Borrower.

SECTION 2.2.    AUTHORIZATION AND VALIDITY.  This Agreement and each promissory note, contract, instrument and other document required hereby or at any time



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hereafter delivered to Bank in connection herewith (collectively, the Loan Documents) have been duly authorized, and upon their execution and delivery in
accordance with the provisions hereof will constitute legal, valid and binding agreements and obligations of Borrower or the party which executes the same, enforceable in accordance with their respective terms.

SECTION 2.3.    NO VIOLATION.  The execution, delivery and performance by Borrower of each of the Loan Documents do not violate any
provision of any law or regulation, or contravene any provision of the Articles of Incorporation or By-Laws of Borrower, or result in any breach of or default under any contract, obligation, indenture or other instrument to which Borrower is a party
or by which Borrower may be bound.

SECTION 2.4.    LITIGATION.  There are no pending, or to the best of
Borrowers knowledge threatened, actions, claims, investigations, suits or proceedings by or before any governmental authority, arbitrator, court or administrative agency which could have a material adverse effect on the financial condition or
operation of Borrower other than those disclosed by Borrower to Bank in writing prior to the date hereof.

SECTION
2.5.    CORRECTNESS OF FINANCIAL STATEMENT.  The annual financial statement of Borrower dated April 6, 2008, and all interim financial statements delivered to Bank since said date, true copies of which have been
delivered by Borrower to Bank prior to the date hereof, (a) are complete and correct and present fairly the financial condition of Borrower, (b) disclose all liabilities of Borrower that are required to be reflected or reserved against
under generally accepted accounting principles, whether liquidated or unliquidated, fixed or contingent, and (c) have been prepared in accordance with generally accepted accounting principles consistently applied. Since the dates of such
financial statements there has been no material adverse change in the financial condition of Borrower, nor has Borrower mortgaged, pledged, granted a security interest in or otherwise encumbered any of its assets or properties except in favor of
Bank or as otherwise noted in Section 5.2 or permitted by Bank in writing.

SECTION 2.6.    INCOME TAX
RETURNS.  Borrower has no knowledge of any pending assessments or adjustments of its income tax payable with respect to any year.

SECTION
2.7.    NO SUBORDINATION.  There is no agreement, indenture, contract or instrument to which Borrower is a party or by which Borrower may be bound that requires the subordination in right of payment of any of
Borrowers obligations subject to this Agreement to any other obligation of Borrower.

SECTION 2.8.    PERMITS,
FRANCHISES.  Borrower possesses, and will hereafter possess, all permits, consents, approvals, franchises and licenses required and rights to all trademarks, trade names, patents, and fictitious names, if any, necessary to enable it to
conduct the business in which it is now engaged in compliance with applicable law.

SECTION 2.9.    ERISA.  Borrower is
in compliance in all material respects with all applicable provisions of the Employee Retirement Income Security Act of 1974, as amended or recodified from time to time (ERISA); Borrower has not violated any provision of any defined
employee pension benefit plan (as defined in ERISA) maintained or contributed to by Borrower (each, a Plan); no Reportable Event as defined in ERISA has occurred and is continuing with respect to any Plan initiated by Borrower; Borrower
has met its minimum funding requirements under ERISA with respect to each Plan; and each Plan will be able to fulfill its benefit obligations as they come due in accordance with the Plan documents and under generally accepted accounting principles.



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SECTION 2.10.    OTHER OBLIGATIONS.  Borrower is not in default on any obligation for
borrowed money, any purchase money obligation or any other material lease, commitment, contract, instrument or obligation.

SECTION
2.11.    ENVIRONMENTAL MATTERS.  Except as disclosed by Borrower to Bank in writing prior to the date hereof, Borrower is in compliance in all material respects with all applicable federal or state environmental,
hazardous waste, health and safety statutes, and any rules or regulations adopted pursuant thereto, which govern or affect any of Borrowers operations and/or properties, including without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Superfund Amendments and Reauthorization Act of 1986, the Federal Resource Conservation and Recovery Act of 1976, and the Federal Toxic Substances Control Act, as any of the same may be amended, modified
or supplemented from time to time. None of the operations of Borrower is the subject of any federal or state investigation evaluating whether any remedial action involving a material expenditure is needed to respond to a release of any toxic or
hazardous waste or substance into the environment. Borrower has no material contingent liability in connection with any release of any toxic or hazardous waste or substance into the environment.

ARTICLE III

CONDITIONS

SECTION 3.1.    CONDITIONS OF INITIAL EXTENSION OF CREDIT.  The obligation of Bank to extend any credit contemplated by this
Agreement is subject to the fulfillment to Banks satisfaction of all of the following conditions:

(a)     Approval
of Bank Counsel.  All legal matters incidental to the extension of credit by Bank shall be satisfactory to Banks counsel.

(b)     Documentation.  Bank shall have received, in form and substance satisfactory to Bank, each of the following, duly executed:



| | (i) | This Agreement and each promissory note or other instrument or document required hereby.
| | --- | ----------------------------------------------------------------------------------------

| | (ii) | Corporate Resolution: Borrowing.
| | ---- | --------------------------------

| | (iii) | Certificate of Incumbency.
| | ----- | --------------------------

| | (iv) | Continuing Security Agreement: Rights to Payment and Inventory.
| | ---- | ---------------------------------------------------------------

| | (v) | Security Agreement: Equipment.
| | --- | ------------------------------

| | (vi) | Security Agreement: Specific Rights to Payment.
| | ---- | -----------------------------------------------

| | (vii) | Such other documents as Bank may require under any other Section of this Agreement.
| | ----- | -----------------------------------------------------------------------------------

(c)     Financial Condition.  There shall have been no material adverse change, as determined by Bank, in the financial condition or business of Borrower, nor any material decline, as determined by
Bank, in the market value of any collateral required hereunder or a substantial or material portion of the assets of Borrower.

(d)     Insurance.  Borrower shall have delivered to Bank evidence of insurance coverage on all Borrowers property, in form, substance, amounts, covering risks and issued by companies
satisfactory to Bank, and where required by Bank, with loss payable endorsements in favor of Bank.



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SECTION 3.2.    CONDITIONS OF EACH EXTENSION OF CREDIT.  The obligation of Bank to
make each extension of credit requested by Borrower hereunder shall be subject to the fulfillment to Banks satisfaction of each of the following conditions:

(a)     Compliance.  The representations and warranties contained herein and in each of the other Loan Documents shall be true on and as of the date of the signing of this Agreement and
on the date of each extension of credit by Bank pursuant hereto, with the same effect as though such representations and warranties had been made on and as of each such date, and on each such date, no Event of Default as defined herein, and no
condition, event or act which with the giving of notice or the passage of time or both would constitute such an Event of Default, shall have occurred and be continuing or shall exist.

(b)     Documentation.  Bank shall have received all additional documents which may be required in connection with such
extension of credit.

ARTICLE IV

AFFIRMATIVE COVENANTS

Borrower covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto, or any
liabilities (whether direct or contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, Borrower shall, unless Bank
otherwise consents in writing:

SECTION 4.1.    PUNCTUAL PAYMENTS.  Punctually pay all principal, interest, fees or
other liabilities due under any of the Loan Documents at the times and place and in the manner specified therein, and immediately upon demand by Bank, the amount by which the outstanding principal balance of any credit subject hereto at any time
exceeds any limitation on borrowings applicable thereto.

SECTION 4.2.    ACCOUNTING RECORDS.  Maintain adequate books
and records in accordance with generally accepted accounting principles consistently applied, and permit any representative of Bank, at least two times per calendar year and at such other times as Bank may require, to inspect, audit and examine such
books and records, to make copies of the same, and to inspect the properties of Borrower.

SECTION 4.3.    FINANCIAL
STATEMENTS.  Provide to Bank all of the following, in form and detail satisfactory to Bank:

(a)     not later
than 90 days after and as of the end of each fiscal year, a consolidated financial statement of Borrower, audited by a certified public accountant acceptable to Bank, to include balance sheet, income statement and statement of cash flow;

(b)     not later than 60 days after and as of the end of each fiscal quarter, a financial statement of Borrower, prepared by Borrower,
to include balance sheet, income statement and statement of cash flow;

(c)     not later than 15 days after and as of the
end of each calendar month a detailed aged listing of accounts receivable and accounts payable, by invoice date and due date, with Borrowing Base Certificate (BBC) and a list of the names, addresses and phone numbers of all
Borrowers account debtors. The BBC shall include schedule of memo items showing disbursements to accounts receivable account debtors;



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(d)     from time to time such other information as Bank may reasonably request.

SECTION 4.4.    COMPLIANCE.  Preserve and maintain all licenses, permits, governmental approvals, rights, privileges
and franchises necessary for the conduct of its business; and comply with the provisions of all documents pursuant to which Borrower is organized and/or which govern Borrowers continued existence and with the requirements of all laws, rules,
regulations and orders of any governmental authority applicable to Borrower and/or its business.

SECTION
4.5.    INSURANCE.  Maintain and keep in force, for each business in which Borrower is engaged, insurance of the types and in amounts customarily carried in similar lines of business, including but not limited to fire,
extended coverage, public liability, flood, property damage and workers compensation, with all such insurance carried with companies and in amounts satisfactory to Bank, and deliver to Bank from time to time at Banks request schedules
setting forth all insurance then in effect.

SECTION 4.6.    FACILITIES.  Keep all properties useful or necessary to
Borrowers business in good repair and condition, and from time to time make necessary repairs, renewals and replacements thereto so that such properties shall be fully and efficiently preserved and maintained.

SECTION 4.7.    TAXES AND OTHER LIABILITIES.  Pay and discharge when due any and all indebtedness, obligations, assessments and
taxes, both real or personal, including without limitation federal and state income taxes and state and local property taxes and assessments, except (a) such as Borrower may in good faith contest or as to which a bona fide dispute may arise,
and (b) for which Borrower has made provision, to Banks satisfaction, for eventual payment thereof in the event Borrower is obligated to make such payment.

SECTION 4.8.    LITIGATION.  Promptly give notice in writing to Bank of any litigation pending or threatened against Borrower.

SECTION 4.9.    FINANCIAL CONDITION.  Maintain Borrowers consolidated financial condition as follows using generally accepted
accounting principles consistently applied and used consistently with prior practices (except to the extent modified by the definitions herein):

(a)     Liquidity Ratio not at any time less than 2.0 to 1.0, with Liquidity Ratio defined as the ratio of (i) the sum of unencumbered cash and cash equivalents plus accounts receivable (excluding
all accounts which are ineligible to be included in the Borrowing Base) to (ii) the maximum amount of Banks commitment under the Line of Credit.

(b)     [***]

(c)     Non-GAAP Operating Income/(Loss) in each fiscal quarter, determined
as of the end of each of the following fiscal quarters of (i) not greater than [***] as of the end of the second fiscal quarter of year 2009 ending November 2, 2008, (ii) not greater than



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|au#2690 #5564597639                               |  |     | 



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[***] as of the end of the third fiscal quarter of year 2009 ending February 1, 2009, (iii) not less than [***] as of the end of the fourth fiscal quarter of
year 2009 ending May 3, 2009, (iv) not less than [***] as of the end of the first fiscal quarter of year 2010 ending August 3, 2009, and (v) not less than [***] as of the end of the second fiscal quarter of year 2010 ending
November 1,2009. Non-GAAP Operating Income is defined as GAAP operating income less the following adjustments (only to the extent already included in GAAP operating income): (1) amortization of intangible assets;
(2) amortization of developed technology; (3) in-process research and development charge; (4) stock-based compensation; (5) acquisition-related expenses (only if taken in the quarter of such acquisition), and
(6) restructuring expenses related to headcount reduction of no greater than [***] for the second fiscal quarter of year 2009 ending November 2,2008 and [***] for the fourth fiscal quarter of year 2009 ending May 3, 2009.

SECTION 4.10.    NOTICE TO BANK.  Promptly (but in no event more than five (5) days after the occurrence of each such event
or matter) give written notice to Bank in reasonable detail of: (a) the occurrence of any Event of Default, or any condition, event or act which with the giving of notice or the passage of time or both would constitute an Event of Default;
(b) any change in the name or the organizational structure of Borrower; (c) the occurrence and nature of any Reportable Event or Prohibited Transaction, each as defined in ERISA, or any funding deficiency with respect to any Plan; or
(d) any termination or cancellation of any insurance policy which Borrower is required to maintain, or any uninsured or partially uninsured loss through liability or property damage, or through fire, theft or any other cause affecting
Borrowers property.

ARTICLE V

NEGATIVE COVENANTS

Borrower further covenants that so long as Bank remains committed to extend credit to Borrower pursuant hereto,
or any liabilities (whether direct or contingent, liquidated or unliquidated) of Borrower to Bank under any of the Loan Documents remain outstanding, and until payment in full of all obligations of Borrower subject hereto, Borrower will not (and
will not cause or permit any Subsidiary, as defined at the end of Article V, to) without Banks prior written consent:

SECTION
5.1.    USE OF FUNDS.  Use any of the proceeds of any credit extended hereunder except for the purposes stated in Article I hereof.

SECTION 5.2.    OTHER INDEBTEDNESS.  Create, incur, assume or permit to exist any indebtedness or liabilities resulting from borrowings, loans or advances, whether secured or unsecured, matured or
unmatured, liquidated or unliquidated, joint or several, except (a) the liabilities of Borrower or such Subsidiary to Bank, (b) indebtedness to UBS resulting from loans made by UBS against the value of auction rate securities held by UBS
for the account of Borrower or its Subsidiaries, and (c) any other liabilities of Borrower or such Subsidiary existing as of, and disclosed to Bank prior to, the date hereof.

SECTION 5.3.    SPECIFIED TRANSACTIONS.  Enter into any Specified Transaction unless all consideration paid or payable by Borrower
and/or any Subsidiary for such Specified Transactions consists of common stock of Borrower. Specified Transaction means any of the following, provided that the applicable transaction has been approved by the Board of Directors of the
entity whose assets or the equity interests in which are being acquired or which is merging with Borrower or a Subsidiary:

(a)     the acquisition by Borrower or a Subsidiary of all or substantially all of the assets of another entity or division of such entity;



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|au#2690 #5564597639                               |  |     | 



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(b)     the merger or consolidation of Borrower or any Subsidiary with or into any other
entity, so long as, in the case of Borrower, Borrower is the surviving entity; and

(c)     the acquisition by Borrower or
any Subsidiary of a controlling or majority interest in any other entity;

SECTION 5.4.    MERGER, CONSOLIDATION, TRANSFER OF
ASSETS.  Except as permitted in Section 5.3., merge into or consolidate with any other entity; make any substantial change in the nature of Borrowers and Subsidiaries business, taken as a whole, as conducted as of the date
hereof; acquire all or substantially all of the assets of any other entity; nor sell, lease, transfer or otherwise dispose of all or a substantial or material portion of Borrowers assets except in the ordinary course of its business.

SECTION 5.5.    DIVIDENDS, DISTRIBUTIONS.  Declare or pay any dividend or distribution either in cash, stock or any
other property on Borrowers stock now or hereafter outstanding, nor redeem, retire, repurchase or otherwise acquire any shares of any class of Borrowers stock now or hereafter outstanding.

SECTION 5.6.    DOUBLE NEGATIVE PLEDGE.  Mortgage, pledge, grant or permit to exist a security interest in, or lien upon, all or any
portion of Borrowers or any Subsidiarys assets now owned or hereafter acquired, except any of the foregoing (a) in favor of Bank, (b) which is existing as of, and disclosed to Bank in writing prior to, the date hereof, and
(c) which consist of security interests in auction rate securities described in and subject to the terms of Section 5.2.(b) above. In addition, Borrower shall not agree with any other creditor to prohibit, encumber or condition the
granting of a security interest in its intellectual property (or any portion thereof).

SECTION
5.7.    GUARANTIES.  Guarantee or become liable in any way as surety, endorser (other than as endorser of negotiable instruments for deposit or collection in the ordinary course of business), accommodation endorser or
otherwise for, nor pledge or hypothecate any assets of Borrower or any Subsidiary as security for, any liabilities or obligations of any other person or entity, except any of the foregoing in favor of Bank.

SECTION 5.8.    LOANS, ADVANCES, INVESTMENTS.  Make any loans or advances to or investments in any person or entity, except
(a) any of the foregoing existing as of, and disclosed to Bank prior to, the date hereof, (b) investments which constitute Specified Transactions, subject to the terms of Section 5.3., and (c) additional investments made in
accordance with Borrowers Investment Policy as adopted by its Board of Directors.

Each entity (Whether now existing or hereafter formed or
acquired) in which Borrower, directly or indirectly, owns a controlling or majority interest, is referred to as a Subsidiary.

ARTICLE VI

EVENTS OF DEFAULT

SECTION 6.1.    The occurrence of any of the following shall constitute an Event of Default under this Agreement:

(a)     Borrower shall fail to pay when due any principal, interest, fees or other amounts payable under any of the Loan Documents.



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|au#2690 #5564597639                               |  |      | 



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(b)     Any financial statement or certificate furnished to Bank in connection with, or
any representation or warranty made by Borrower or any other party under this Agreement or any other Loan Document shall prove to be incorrect, false or misleading in any material respect when furnished or made.

(c)     Any default in the performance of or compliance with any obligation, agreement or other provision contained herein or in any other
Loan Document (other than those referred to in subsections (a) and (b) above), and with respect to any such default which by its nature can be cured, such default shall continue for a period of twenty (20) days from its occurrence.

(d)     Any default in the payment or performance of any obligation, or any defined event of default, under the terms of
any contract or instrument (other than any of the Loan Documents) pursuant to which Borrower, any Subsidiary, any guarantor hereunder or any general partner or joint venturer in Borrower if a partnership or joint venture (with each such guarantor,
general partner and/or joint venturer referred to herein as a Third Party Obligor) has incurred any debt or other liability to any person or entity, including Bank.

(e)     The filing of a notice of judgment lien against Borrower, any Subsidiary or any Third Party Obligor; or the recording of any
abstract of judgment against Borrower, any Subsidiary or any Third Party Obligor in any county in which Borrower, any Subsidiary or such Third Party Obligor has an interest in real property; or the service of a notice of levy and/or of a writ of
attachment or execution, or other like process, against the assets of Borrower, any Subsidiary or any Third Party Obligor; or the entry of a judgment against Borrower, any Subsidiary or any Third Party Obligor.

(f)      Borrower, any Subsidiary or any Third Party Obligor shall become insolvent, or shall suffer or consent to or apply for the
appointment of a receiver, trustee, custodian or liquidator of itself or any of its property, or shall generally fail to pay its debts as they become due, or shall make a general assignment for the benefit of creditors; Borrower, any Subsidiary or
any Third Party Obligor shall file a voluntary petition in bankruptcy, or seeking reorganization, in order to effect a plan or other arrangement with creditors or any other relief under the Bankruptcy Reform Act, Title 11 of the United States Code,
as amended or recodified from time to time (Bankruptcy Code), or under any state or federal law granting relief to debtors, whether now or hereafter in effect; or any involuntary petition or proceeding pursuant to the Bankruptcy Code or
any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors is filed or commenced against Borrower, any Subsidiary or any Third Party Obligor, or Borrower, any Subsidiary or any Third Party Obligor
shall file an answer admitting the jurisdiction of the court and the material allegations of any involuntary petition; or Borrower, any Subsidiary or any Third Party Obligor shall be adjudicated a bankrupt, or an order for relief shall be entered
against Borrower, any Subsidiary or any Third Party Obligor by any court of competent jurisdiction under the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors.

(g)     There shall exist or occur any event or condition which Bank in good faith believes impairs, or is substantially likely to
impair, the prospect of payment or performance by Borrower of its obligations under any of the Loan Documents.



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|au#2690 #5564597639                               |  |      | 



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(h)     The death or incapacity of Borrower or any Third Party Obligor if an individual.
The dissolution or liquidation of Borrower or any Third Party Obligor if a corporation, partnership, joint venture or other type of entity; or Borrower or any such Third Party Obligor. or any of its directors, stockholders or members, shall take
action seeking to effect the dissolution or liquidation of Borrower or such Third Party Obligor.

(i)      Any change
in ownership of an aggregate of twenty-five percent (25%) or more of the common stock of Borrower in a single or in a series of related transactions.

SECTION 6.2.    REMEDIES.  Upon the occurrence of any Event of Default: (a) all indebtedness of Borrower under each of the Loan Documents, any term thereof to the contrary notwithstanding, shall at
Banks option and without notice become immediately due and payable without presentment, demand, protest or notice of dishonor, all of which are hereby expressly waived by Borrower; (b) the obligation, if any, of Bank to extend any further
credit under any of the Loan Documents shall immediately cease and terminate; and (c) Bank shall have all rights, powers and remedies available under each of the Loan Documents, or accorded by law, including without limitation the right to
resort to any or all security for any credit subject hereto and to exercise any or all of the rights of a beneficiary or secured party pursuant to applicable law. All rights, powers and remedies of Bank may be exercised at any time by Bank and from
time to time after the occurrence of an Event of Default, are cumulative and not exclusive, and shall be in addition to any other rights, powers or remedies provided by law or equity.

ARTICLE VII

MISCELLANEOUS

SECTION 7.1.    NO WAIVER.  No delay, failure or discontinuance of Bank in exercising any right, power or remedy under any of the
Loan Documents shall affect or operate as a waiver of such right, power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise
of any other right, power or remedy. Any waiver, permit, consent or approval of any kind by Bank of any breach of or default under any of the Loan Documents must be in writing and shall be effective only to the extent set forth in such writing.

SECTION 7.2.    NOTICES.  All notices, requests and demands which any party is required or may desire to give to any
other party under any provision of this Agreement must be in writing delivered to each party at the following address:



|          |  |                                       
|--------- |  | --------------------------------------
|BORROWER: |  | MAGMA DESIGN AUTOMATION, INC.         
|          |  | 1650 Technology Drive                 
|          |  | San Jose, CA 95110                    
|          | 
|BANK:     |  | WELLS FARGO BANK, NATIONAL ASSOCIATION
|          |  | Santa Clara Valley RCBO               
|          |  | 121 Park Center Plaza, 2nd Floor      
|          |  | San Jose, CA 95113                    

or to such other address as any party may designate by written notice to all other parties. Each such notice, request and
demand shall be deemed given or made as follows: (a) if sent by hand delivery, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or three (3) days after deposit in the U.S. mail, first class and postage
prepaid; and (c) if sent by telecopy, upon receipt.



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|au#2690 #5564597639                               |  |      | 



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SECTION 7.3.    COSTS, EXPENSES AND ATTORNEYS FEES.  Borrower shall pay to Bank
immediately upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys fees (to include outside counsel fees and all allocated costs of Banks in-house counsel), expended or incurred
by Bank in connection with (a) the negotiation and preparation of this Agreement and the other Loan Documents, Banks continued administration hereof and thereof, and the preparation of any amendments and waivers hereto and thereto,
(b) the enforcement of Banks rights and/or the collection of any amounts which become due to Bank under any of the Loan Documents, and (c) the prosecution or defense of any action in any way related to any of the Loan Documents,
including without limitation, any action for declaratory relief, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding
(including without limitation, any adversary proceeding, contested matter or motion brought by Bank or any other person) relating to Borrower or any other person or entity.

SECTION 7.4.    SUCCESSORS, ASSIGNMENT.  This Agreement shall be binding upon and inure to the benefit of the heirs, executors,
administrators, legal representatives, successors and assigns of the parties; provided however, that Borrower may not assign or transfer its interests or rights hereunder without Banks prior written consent. Bank reserves the right to sell,
assign, transfer, negotiate or grant participations in all or any part of, or any interest in, Banks rights and benefits under each of the Loan Documents. In connection therewith, Bank may disclose all documents and information which Bank now
has or may hereafter acquire relating to any credit subject hereto, Borrower or its business, or any collateral required hereunder.

SECTION
7.5.    ENTIRE AGREEMENT; AMENDMENT.  This Agreement and the other Loan Documents constitute the entire agreement between Borrower and Bank with respect to each credit subject hereto and supersede all prior
negotiations, communications, discussions and correspondence concerning the subject matter hereof. This Agreement may be amended or modified only in writing signed by each party hereto.

SECTION 7.6.    NO THIRD PARTY BENEFICIARIES.  This Agreement is made and entered into for the sole protection and benefit of the
parties hereto and their respective permitted successors and assigns, and no other person or entity shall be a third party beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement or any other of the
Loan Documents to which it is not a party.

SECTION 7.7.    TIME.  Time is of the essence of each and every provision
of this Agreement and each other of the Loan Documents.

SECTION 7.8.    SEVERABILITY OF PROVISIONS.  If any provision
of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity without invalidating the remainder of such provision or any remaining provisions of
this Agreement.

SECTION 7.9.    COUNTERPARTS.  This Agreement may be executed in any number of counterparts, each of
which when executed and delivered shall be deemed to be an original, and all of which when taken together shall constitute one and the same Agreement.



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|au#2690 #5564597639                               |  |      | 



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SECTION 7.10.    GOVERNING LAW.  This Agreement shall be governed by and construed in
accordance with the laws of the State of California.

SECTION 7.11.    ARBITRATION.

(a)     Arbitration.  The parties hereto agree, upon demand by any party, to submit to binding arbitration all claims,
disputes and controversies between or among them (and their respective employees, officers, directors, attorneys, and other agents), whether in tort, contract or otherwise in any way arising out of or relating to (i) any credit subject hereto,
or any of the Loan Documents, and their negotiation, execution, collateralization, administration, repayment, modification, extension, substitution, formation, inducement, enforcement, default or termination; or (ii) requests for additional
credit.

(b)     Governing Rules.  Any arbitration proceeding will (i) proceed in a location in
California selected by the American Arbitration Association (MA); (ii) be governed by the Federal Arbitration Act (Title 9 of the United States Code), notwithstanding any conflicting choice of law provision in any of the documents
between the parties; and (iii) be conducted by the MA, or such other administrator as the parties shall mutually agree upon, in accordance with the MAs commercial dispute resolution procedures, unless the claim or counterclaim is at least
$1,000,000.00 exclusive of claimed interest, arbitration fees and costs in which case the arbitration shall be conducted in accordance with the MAs optional procedures for large, complex commercial disputes (the commercial dispute resolution
procedures or the optional procedures for large, complex commercial disputes to be referred to herein, as applicable, as the Rules). If there is any inconsistency between the terms hereof and the Rules, the terms and procedures set forth
herein shall control. Any party who fails or refuses to submit to arbitration following a demand by any other party shall bear all costs and expenses incurred by such other party in compelling arbitration of any dispute. Nothing contained herein
shall be deemed to be a waiver by any party that is a bank of the protections afforded to it under 12 U.S.C. §91 or any similar applicable state law.

(c)     No Waiver of Provisional Remedies, Self-Help and Foreclosure.  The arbitration requirement does not limit the right of any party to (i) foreclose against real or personal property
collateral; (ii) exercise self-help remedies relating to collateral or proceeds of collateral such as setoff or repossession; or (iii) obtain provisional or ancillary remedies such as replevin, injunctive relief, attachment or the
appointment of a receiver, before during or after the pendency of any arbitration proceeding. This exclusion does not constitute a waiver of the right or obligation of any party to submit any dispute to arbitration or reference hereunder, including
those arising from the exercise of the actions detailed in sections (i), (ii) and (iii) of this paragraph.

(d)     Arbitrator Qualifications and Powers.  Any arbitration proceeding in which the amount in controversy is $5,000,000.00 or less will be decided by a single arbitrator selected according to the
Rules, and who shall not render an award of greater than $5,000,000.00. Any dispute in which the amount in controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel of three arbitrators; provided however, that all three
arbitrators must actively participate in all hearings and deliberations. The arbitrator will be a neutral attorney licensed in the State of California or a neutral retired judge of the state or federal judiciary of California, in either case with a
minimum of ten years experience in the substantive law applicable to the subject matter of the dispute to be arbitrated. The arbitrator will determine whether or not an issue is arbitratable and will give effect to the statutes of limitation in
determining any claim. In any arbitration proceeding the arbitrator will decide (by documents only or with a hearing at the



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|au#2690 #5564597639                               |  |      | 



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arbitrators discretion) any pre-hearing motions which are similar to motions to dismiss for failure to state a claim or motions for summary adjudication. The
arbitrator shall resolve all disputes in accordance with the substantive law of California and may grant any remedy or relief that a court of such state could order or grant within the scope hereof and such ancillary relief as is necessary to make
effective any award. The arbitrator shall also have the power to award recovery of all costs and fees, to impose sanctions and to take such other action as the arbitrator deems necessary to the same extent a judge could pursuant to the Federal Rules
of Civil Procedure, the California Rules of Civil Procedure or other applicable law. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction. The institution and maintenance of an action for judicial relief
or pursuit of a provisional or ancillary remedy shall not constitute a waiver of the right of any party, including the plaintiff, to submit the controversy or claim to arbitration if any other party contests such action for judicial relief.

(e)     Discovery.  In any arbitration proceeding, discovery will be permitted in accordance with the
Rules. All discovery shall be expressly limited to matters directly relevant to the dispute being arbitrated and must be completed no later than 20 days before the hearing date. Any requests for an extension of the discovery periods, or any
discovery disputes, will be subject to final determination by the arbitrator upon a showing that the request for discovery is essential for the partys presentation and that no alternative means for obtaining information is available.

(f)     Class Proceedings and Consolidations.  No party hereto shall be entitled to join or consolidate
disputes by or against others in any arbitration, except parties who have executed any Loan Document, or to include in any arbitration any dispute as a representative or member of a class, or to act in any arbitration in the interest of the general
public or in a private attorney general capacity.

(g)     Payment Of Arbitration Costs And Fees.  The
arbitrator shall award all costs and expenses of the arbitration proceeding.

(h)     Real Property Collateral; Judicial
Reference.  Notwithstanding anything herein to the contrary, no dispute shall be submitted to arbitration if the dispute concerns indebtedness secured directly or indirectly, in whole or in part, by any real property unless
(i) the holder of the mortgage, lien or security interest specifically elects in writing to proceed with the arbitration, or (ii) all parties to the arbitration waive any rights or benefits that might accrue to them by virtue of the single
action rule statute of California, thereby agreeing that all indebtedness and obligations of the parties, and all mortgages, liens and security interests securing such indebtedness and obligations, shall remain fully valid and enforceable. If any
such dispute is not submitted to arbitration, the dispute shall be referred to a referee in accordance with California Code of Civil Procedure Section 638 et seq., and this general reference agreement is intended to be specifically enforceable
in accordance with said Section 638. A referee with the qualifications required herein for arbitrators shall be selected pursuant to the AAAs selection procedures. Judgment upon the decision rendered by a referee shall be entered in the
court in which such proceeding was commenced in accordance with California Code of Civil Procedure Sections 644 and 645.

(i)      Miscellaneous.  To the maximum extent practicable, the AAA, the arbitrators and the parties shall take all action required to conclude any arbitration proceeding within 180 days of the
filing of the dispute with the AAA. No arbitrator or other party to an arbitration proceeding may disclose the existence, content or results thereof, except for disclosures of information by a party required in the ordinary course of its business or
by applicable law or regulation. If more than one agreement for arbitration by or between the parties potentially applies to a dispute, the



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|au#2690 #5564597639                               |  |      | 



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arbitration provision most directly related to the Loan Documents or the subject matter of the dispute shall control. This arbitration provision shall survive
termination, amendment or expiration of any of the Loan Documents or any relationship between the parties.

(j)     Small
Claims Court.  Notwithstanding anything herein to the contrary, each party retains the right to pursue in Small Claims Court any dispute within that courts jurisdiction. Further, this arbitration provision shall apply only to
disputes in which either party seeks to recover an amount of money (excluding attorneys fees and costs) that exceeds the jurisdictional limit of the Small Claims Court.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first written above.



|                              |  |                         |  |                                        |  |     |  |                 
|----------------------------- |  | ----------------------- |  | -------------------------------------- |  | --- |  | ----------------
|MAGMA DESIGN AUTOMATION, INC. |  |                         |  | WELLS FARGO BANK, NATIONAL ASSOCIATION
|                              |  |                         |  |                                       
|By:                           |  | /s/ Peter Teshima       |  |                                        |  | By: |  | /s/ Debra Bowman
|                              |  | Peter Teshima           |  |                                        |  |     |  | Debra Bowman    
|                              |  | Chief Financial Officer |  |                                        |  |     |  | Vice President  
|                              |  |                         |  |                                       
|By:                           |  | /s/ Roy Jewell          |  |                                        |  |     |  |                 
|                              |  | Roy Jewell              |  |                                        |  |     |  |                 
|                              |  | President               |  |                                        |  |     |  |                 



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|au#2690 #5564597639                               |  |      |