Document:

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                                                                   EXHIBIT 10.16

                              JOINT SALES AGREEMENT

                                  BY AND AMONG

                          CADENCE DESIGN SYSTEMS, INC.,

                             CADENCE HOLDINGS, INC.,

                                   TALITY, LP

                                       AND

                               TALITY CORPORATION

                                   DATED AS OF

                                 ________, 2000

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                                TABLE OF CONTENTS

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ARTICLE I  DEFINITIONS .........................................................       2
         Section 1.1   Booking .................................................       2
         Section 1.2   Cadence Account Team ....................................       2
         Section 1.3   Client ..................................................       2
         Section 1.4   Confidential Information ................................       2
         Section 1.5   District Manager ........................................       2
         Section 1.6   Highly Confidential Information .........................       2
         Section 1.7   Joint Target Account ....................................       2
         Section 1.8   Party ...................................................       2
         Section 1.9   Tality Account Team .....................................       2
         Section 1.10  Tality Services .........................................       2
         Section 1.11  Target Account Manager ..................................       2
         Section 1.12  Territory ...............................................       3

ARTICLE II  SCOPE OF REPRESENTATION AND GENERAL MARKETING
         AND SALES SUPPORT OBLIGATIONS .........................................       3
         Section 2.1   Appointment .............................................       3
         Section 2.2   Independent Contractors .................................       3
         Section 2.3   Cadence's Duties ........................................       3
         Section 2.4   Duties of Tality Joint Account Team Members .............       4
         Section 2.5   Joint Escalation Procedure ..............................       5
         Section 2.6   Joint Sales Review ......................................       5
         Section 2.7   Administration of Bookings and Payment of Commission ....       5
         Section 2.8   Costs and Expenses ......................................       5

ARTICLE III  JOINT TARGET ACCOUNT PROGRAM ......................................       6
         Section 3.1   Scope ...................................................       6
         Section 3.2   Identification of Joint Target Accounts .................       6
         Section 3.3   Performance and Payment .................................       6
         Section 3.4   Annual Review of Joint Target Account Program ...........       6

ARTICLE IV  GEOGRAPHY CHANNEL PROGRAM ..........................................       6
         Section 4.1   Scope ...................................................       6
         Section 4.2   Non-Joint Target Accounts ...............................       6
         Section 4.3   Performance and Payment .................................       7
         Section 4.4   Annual Review of Geography Channel Program ..............       7

ARTICLE V  TERM AND TERMINATION ................................................       7
         Section 5.1   Initial Term and Renewal ................................       7
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         Section 5.2   Termination for Cause ...................................       7
         Section 5.3   Termination for Insolvency ..............................       7
         Section 5.4   Return of Materials .....................................       7
         Section 5.5   Survival of Certain Terms ...............................       7
         Section 5.6   Events of Default .......................................       8

ARTICLE VI  CONFIDENTIALITY ....................................................       8
         Section 6.1   Master Confidentiality Agreement ........................       8
         Section 6.2   Client's Confidential Information .......................       8

ARTICLE VII  CONFLICTS OF INTEREST .............................................       8

ARTICLE VIII  TRADEMARKS .......................................................       9

ARTICLE IX  LIMITATION OF LIABILITY; CLAIMS ....................................       9
         Section 9.1   No Consequential Damages ................................       9
         Section 9.2   Warranty ................................................       9
         Section 9.3   Limitation of Claims ....................................       9

ARTICLE X  DISPUTE RESOLUTION ..................................................       9

ARTICLE XI  GENERAL PROVISIONS .................................................       9
         Section 11.1  Assignment ..............................................       9
         Section 11.2  Governing Law ...........................................      10
         Section 11.3  Conflicting Agreements ..................................      10
         Section 11.4  Incorporation by Reference ..............................      10
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                              JOINT SALES AGREEMENT

         THIS JOINT SALES AGREEMENT (this "Agreement"), dated and effective as
of _______, 2000, by and among Cadence Design Systems, Inc., a Delaware
corporation ("Cadence") and Cadence Holdings, Inc., a Delaware corporation
("Holdings" and, together with Cadence, the "Cadence Parties"), on the one hand,
and Tality, LP, a Delaware limited partnership (the "Partnership"), and Tality
Corporation, a Delaware corporation ("Tality" and, together with the
Partnership, the "Tality Parties"), on the other hand. Capitalized terms used
herein and not defined elsewhere herein shall have the meaning ascribed to them
in Article I or in the Separation Agreement (as defined below).

                                    RECITALS

         WHEREAS, Holdings currently owns approximately 98% of the issued and
outstanding shares of the capital stock of Tality;

         WHEREAS, Tality is the sole general partner of, and owns both a general
and limited partnership interest in, the Partnership;

         WHEREAS, each of the Boards of Directors of Cadence, Tality and
Holdings determined that it would be appropriate and desirable for Cadence to
transfer (or cause to be transferred) to the Partnership, on behalf of Holdings,
and for the Partnership to receive and assume, directly or indirectly, as a
contribution from Holdings, certain assets and liabilities of Cadence associated
with the Tality Business;

         WHEREAS, Cadence, Tality and Holdings are parties to that certain
Master Separation Agreement, dated as of July 14, 2000, as amended or restated
(the "Separation Agreement"), pursuant to which Cadence, Tality, Holdings and
the Partnership have agreed, subject to certain conditions, to the legal
separation of the Tality Business from Cadence's other businesses and to have
the Partnership and its Subsidiaries own and operate the entire Tality Business;
and

         WHEREAS, all conditions to the Separation have been satisfied or
waived, and Cadence, Holdings, the Partnership and Tality now desire to execute
and deliver this Agreement to set forth certain arrangements regarding the
establishment of Cadence as a non-exclusive independent representative for the
promotion of Tality Services in certain geographical territories and to
identified Joint Target Accounts.

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                                    AGREEMENT

         NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

         For purposes of this Agreement, the following capitalized terms shall
have the meanings assigned to them below:

         Section 1.1 "Booking" means a binding order for Tality Services. A
Booking occurs when an authorized Client representative executes an agreement to
procure Tality Services. The booking amount will be determined by the then
current booking policies of Tality.

         Section 1.2 "Cadence Account Team" means a team of Cadence sales
persons with (i) a minimum of one (1) dedicated (i.e., full-time) Global Account
Director and one (1) dedicated sales person, in the case of each Joint Target
Account; (ii) a minimum of one (1) Territory Sales Manager and one (1) sales
person, in the case of each other account.

         Section 1.3 "Client" means a potential or existing purchaser of
products or services provided by either or both of the Parties.

         Section 1.4 "Confidential Information" has the meaning set forth in the
Master Confidentiality Agreement.

         Section 1.5 "District Manager" means the Cadence manager responsible
for a geographical region consisting of multiple Clients and whose
responsibilities include selling Cadence's full product line into those Clients.

         Section 1.6 "Joint Target Account" means the Clients identified on
Exhibit A.

         Section 1.7 "Party" means the Tality Parties, on the one hand, the
Cadence Parties, on the other, and, in the plural, the Tality Parties together
with the Cadence Parties.

         Section 1.8 "Tality Account Team" means one or more of the
Partnership's sales persons whose responsibilities include selling the
Partnership's full design service product line to a specific Client or into a
geographic region.

         Section 1.9 "Tality Services" means the professional design services
provided

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by the Partnership to Clients, including printed circuit board and integrated
circuit design services targeted at the wireless, data communication and
telecommunication, information appliance and consumer market.

         Section 1.10 "Target Account Manager" means the Cadence target account
manager responsible for the worldwide relationship with a single, specific
Client and whose responsibilities include selling Cadence's full product line to
that Client.

         Section 1.11 "Territory" means a geographic region identified on
Exhibit C.

                                   ARTICLE II

                           SCOPE OF REPRESENTATION AND
                 GENERAL MARKETING AND SALES SUPPORT OBLIGATIONS

         Section 2.1 Appointment. The Partnership hereby appoints Cadence as a
non-exclusive independent representative and authorizes Cadence to promote
Tality Services to Clients as specified in Articles III and IV.

         Section 2.2 Independent Contractors. The relationship between the
Parties established by this Agreement is that of independent contractors, and
nothing contained in this Agreement shall be construed to create an agency
relationship between the Parties or to allow Cadence to create or assume any
obligation on behalf of the Tality Parties for any purpose whatsoever.

         Section 2.3 Cadence's Duties. Each Cadence Account Team member
participating in the joint sales program established by this Agreement shall,
within its account responsibility:

                   (a) Use reasonable commercial efforts to identify potential
Clients for the Partnership and other members of the Tality Group, share
information concerning the Clients, assist the Partnership and other members of
the Tality Group in acquiring access and influence with Client, especially at
executive levels, and promote Tality Services;

                   (b) Promptly report any sales opportunity and provide detail
regarding such opportunities as the Partnership may reasonably request,
including the Client's business objectives, organization, and competitive
landscape;

                   (c) Pre-qualify Clients in accordance with the guidelines
which the Partnership may provide from time to time;

                   (d) Maintain, during the term of this Agreement, and for at
least three (3) years thereafter, accurate records of all Client contacts and
copies of all Client correspondence relating to Cadence's performance of its
obligations under this Agreement and allow the Partnership reasonable access to
examine such records upon five (5) days' notice;

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                   (e) Assist the Partnership in generating Bookings by using
reasonable commercial efforts to leverage Cadence's relationships with the
Client's representatives and knowledge of the Client's procurement process;

                   (f) Respond in a timely fashion to product and methodology
services opportunities referred by the Partnership;

                   (g) Provide the Partnership with reasonable access to account
knowledge and support systems, including such tools as the "Introspect" analysis
tool;

                   (h) Each Cadence Account Team shall meet periodically with
the corresponding Tality Account Team, at such frequency as the Parties may
determine mutually, to (i) review the status of its Client and develop a plan to
address areas of concern, if any, (ii) conduct joint project reviews, (iii)
develop joint strategies for future business, beginning with, at the first such
review(s), a joint initiative targeting the Parties' sales opportunities in the
customer owned tooling ("COT") market;

                   (i) Cadence shall provide continued access to Cadence's sales
development training materials and courses. The pricing and terms of any such
training program shall be subject to terms as the Parties may subsequently
agree;

                   (j) Cadence shall establish links, as appropriate, to the
Partnership's web site as soon as practicable; and

                   (k) Cadence shall promote and advertise Tality Services. For
this purpose, the Parties shall coordinate reasonably so that, for example,
promotional or advertising campaigns featuring Tality Services are submitted to
the Partnership for its review and approval prior to publication or use. Cadence
must obtain written approval prior to use of the Tality name in promotional
campaigns or advertising, such approval not to be unreasonably withheld or
delayed.

         Section 2.4 Duties of Tality Account Team Members. Each Tality Account
Team member participating in the joint sales program established by this
Agreement shall, within its account responsibility:

                   (a) Review each identified sales opportunity to determine
whether the opportunity should be approved. Such approval is at the sole
discretion of the Partnership;

                   (b) Assist Cadence Account Team members with joint sales
activities and the promotion and representation of Tality Services, including
providing Cadence with marketing and promotional information as Cadence may
require;

                   (c) Recommend Cadence products to Clients where appropriate;

                   (d) Promptly respond to design services sales opportunities
by

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identifying appropriate offerings of the Partnership and making them available
to the Client in a timely and effective manner subject to the normal constraints
of a services business;

                   (e) Each Tality Account Team shall meet periodically with the
corresponding Cadence Account Team, at such frequency as the parties may
determine mutually, to (i) review the status of its Client and develop a plan to
address areas of concern, if any, (ii) conduct joint project reviews, (iii)
develop joint strategies for future business, beginning with, at the first such
review(s), a joint initiative targeting the Parties' sales opportunities in the
COT market;

                   (f) The Partnership shall develop and implement a program to
train Cadence Account Teams as Cadence may reasonably specify. The pricing and
terms of any such training program shall be subject to terms as the Parties may
subsequently agree;

                   (g) The Partnership shall maintain full responsibility for
(i) design service project assessment and determination of project scope of
work, generation and presentation of a written Statement of Work ("SOW")
describing the services to be provided to the Client, (ii) execution of any and
all agreements with the Client, (iii) providing Clients information related to
the Partnership's business commitments, including budgetary proposals (also
known as "Yellow Pads"), Professional Service Agreements ("PSA's"), pricing,
technical capabilities, and staffing capabilities, and (iv) addressing Client
satisfaction, performance, and post-sales support issues; and

                   (f) The Partnership shall establish links, as appropriate, to
Cadence's web site as soon as practicable.

         Section 2.5 Joint Escalation Procedure. The Parties shall establish a
coordinated "escalation" procedure to promptly and efficiently direct complaints
and inquiries received from Cadence Account Teams, Tality Account Teams or
Clients and direct these inquiries to the appropriate Party at the appropriate
managerial level.

         Section 2.6 Joint Sales Review. Not later than three (3) months prior
to the first anniversary date of this Agreement, the Parties shall schedule and
conduct a joint sales review for the purpose of determining the success of the
first year of operation of this Agreement, areas where improvement is needed,
sales performance against quotas, and whether and to what extent to adjust this
Agreement.

         Section 2.7 Administration of Bookings and Payment of Commission.
Commissions are payable on Bookings in accordance with Articles III and IV.
Commission will not be earned or paid on "pass-through" items or services.
Reconciliation of commissions owed by the Partnership to Cadence shall be
completed by the sixtieth (60th) day of the quarter following that in which a
Booking was made, and payment by the Partnership to Cadence shall be provided
within thirty (30) days after reconciliation. The Partnership's then current
Booking policies and commission payment policies shall apply to Bookings made by
Cadence, including policies associated with (i)

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commissions on Bookings over $3,000,000; and (ii) treatment of previous Bookings
that are cancelled, in whole or in part, or modified by a Client.

         Section 2.8 Costs and Expenses. Except as expressly provided herein or
agreed to in writing by the Parties, each Party will pay all costs and expenses
incurred in its performance of its obligations under this Agreement.

                                   ARTICLE III

                          JOINT TARGET ACCOUNT PROGRAM

         Section 3.1 Scope. The Parties believe there are a number of mutually
strategic Clients that the Parties wish to pursue in a highly coordinated
fashion. This Article III describes the terms associated with this cooperative
effort.

         Section 3.2 Identification of Joint Target Accounts. Before the
thirtieth (30th) day of each calendar year, Cadence and the Partnership shall
mutually agree on accounts to be included in the Joint Target Account Program.
At any time by mutual consent, Cadence and the Partnership may add or remove any
of the Joint Target Accounts. Joint Target Accounts may be removed from the list
by either Cadence or the Partnership before the thirtieth (30th) day of each
calendar year without mutual consent. Exhibit A shall be modified and updated as
appropriate to reflect the then current list of accounts included in the Joint
Target Account Program.

         Section 3.3 Performance and Payment. Cadence shall provide the sales
organization and perform the marketing and sales scope as specified on Exhibit B
and, in consideration for such performance, the Partnership shall pay amounts to
Cadence, for commissions to the Cadence Account Team, for Bookings to Joint
Target Accounts, where made subsequent to the date hereof and during the term
hereof, as further specified in and in accordance with Exhibit B and Exhibit E.
Neither Party may change the terms of Exhibit B or Exhibit E without the express
written consent of the other Party.

         Section 3.4 Annual Review of Joint Target Account Program. Before the
thirtieth (30th) day of each calendar year, Cadence and the Partnership shall
agree on key elements of the Joint Target Account Program including (i)
modifications to the general operating model described in Article II; (ii)
Cadence Account Team compensation structure and quota related to both Cadence
product and service offerings and service offerings of the Partnership; (iii)
Cadence Account Team coverage of Joint Target Accounts; (iv) resolution of any
outstanding payments obligation of the Parties; and (v) changes to Exhibit A,
Exhibit B and Exhibit E to reflect any agreed-upon revisions to the Joint Target
Account Program for the next calendar year.

                                   ARTICLE IV

                            GEOGRAPHY CHANNEL PROGRAM

         Section 4.1 Scope. The Parties believe cooperative sales efforts
targeted on non-Joint Target Accounts are mutually beneficial and wish to pursue
these Clients in a

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coordinated fashion. This Article IV describes the terms associated with this
cooperative effort.

         Section 4.2 Non-Joint Target Accounts. Before the thirtieth (30th) day
of each calendar year, Cadence and the Partnership shall agree on Territories to
be included in the Geography Channel Program. At any time by mutual consent,
Cadence or the Partnership may add or remove any of the Territories. Territories
may be removed from the list by either Cadence or the Partnership before the
thirtieth (30th) day of each calendar year. Exhibit C shall be modified and
updated as appropriate to reflect the then current list of Territories included
in the Geography Channel Program.

         Section 4.3 Performance and Payment. Cadence shall provide the sales
organization and perform the marketing and sales services as specified in
Exhibit D and, in consideration for such performance, the Partnership shall pay
amounts to Cadence, for commissions to the Cadence Account Team, for Bookings to
non-Joint Target Accounts, where made after the date hereof and during the term
hereof, as further specified in and in accordance with Exhibit D and Exhibit F.
Neither Party may change the terms of Exhibit D or Exhibit F without the express
written consent of the other Party.

         Section 4.4 Annual Review of Geography Channel Program. Before the
thirtieth (30th) day of each calendar year, Cadence and the Partnership shall
agree on key elements of the Geography Channel Program, including (i)
modifications to the general operating model described in Article II; (ii)
Cadence Account Team compensation structure and quota related to both Cadence
product and service offerings and Tality service offerings; (iii) Cadence
Account Team coverage of Territories; (iv) resolution of any outstanding
payments obligations of the Parties; and (v) changes to Exhibit C, Exhibit D and
Exhibit F to reflect any agreed-upon revisions to the Geography Channel Program
for the next calendar year.

                                    ARTICLE V

                              TERM AND TERMINATION

         Section 5.1 Initial Term and Renewal. The initial term of this
Agreement will commence on the date hereof and, subject to Sections 5.2 and 5.3
terminate at the end of the Partnership's fiscal year 2001 (the "Initial Term").
At the expiration of the Initial Term, this Agreement will automatically expire
unless the Parties agree in writing to renew this Agreement for an additional
fixed term prior to such automatic expiration.

         Section 5.2 Termination for Cause. Either Party may terminate this
Agreement upon an Event of Default as defined in Section 5.6.

         Section 5.3 Termination for Insolvency. Either Party may terminate this
Agreement immediately, upon written notice, (i) upon the institution by or
against the other Party of insolvency, receivership or bankruptcy proceedings or
any other proceedings for the settlement of the other's debts, (ii) upon the
other Party's (except for Holdings') making an assignment for the benefit of
creditors or (iii) upon the other Party's

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(except for Holdings') dissolution or ceasing to conduct business in the normal
course.

         Section 5.4 Return of Materials. All of the Partnership's Confidential
Information, data, literature, and sales aids of every kind shall remain the
property of the Partnership. Within thirty (30) days after the termination of
this Agreement, Cadence shall destroy or return all such items as the
Partnership may direct at the Partnership's expense.

         Section 5.5 Survival of Certain Terms. The provisions of this Article
V, Sections 3.3 of Article III and 4.3 of Article IV, Article VI, Article VII,
Article VIII, Article X and Article XI shall survive the termination of this
Agreement for any reason. All other rights and obligations of the parties shall
cease upon termination of this Agreement.

         Section 5.6 Events of Default. An "Event of Default"occurs if either
Party breaches any material provision of this Agreement and fails to correct
such breach within thirty (30) days after its receipt of written notice thereof.
Events constituting a "material breach" shall include the Partnership's failure
to pay when due all or any portion of any amounts payable hereunder.

                                   ARTICLE VI

                                 CONFIDENTIALITY

         Section 6.1 Master Confidentiality Agreement. With respect to the
performance of this Agreement, the Parties agree that they are bound by the
terms of the Master Confidentiality Agreement and, in accordance therewith, each
Party acknowledges and agrees that, through their relationship, they may obtain
Confidential Information of the other Party, which value would be impaired if
such information were disclosed to third parties.

         Section 6.2 Client's Confidential Information. Neither Party shall be
under any obligation to disclose confidential Client information to the other
Party without the Client's written consent. The Parties shall use all
commercially reasonable efforts to obtain such consent from a Client where
disclosure of such Client's confidential information appears reasonably
necessary to fulfill the purposes of this Agreement. If either Party discloses
confidential Client information to the other Party without notifying the other
Party in writing that such information is confidential, the disclosing Party
shall defend and indemnify the other Party for any third party liability arising
from such disclosure.

                                   ARTICLE VII

                              CONFLICTS OF INTEREST

         Cadence shall not agree to formally represent, or promote for sale the
products or services of, any other Person that engages in the Tality Business
without first notifying the Partnership and receiving its written consent.
Notwithstanding the foregoing, nothing

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in this Article VII shall restrict Cadence from selling EDA Tools or methodology
services to any Client.

                                  ARTICLE VIII

                                   TRADEMARKS

         Neither Party may use the trademarks, trade names, logos, designations
or copyrights of the other Party, except where prior written authorization has
been obtained. Neither Party, at any time during or after this Agreement, shall
assert or claim any interest in, or do anything that may adversely affect the
validity or enforceability of, any trademark, trade name, logo, designation or
copyright of the other Party, and each Party acknowledges that nothing in this
Agreement shall give either Party any right, title or interest in any
trademarks, trade names, logos, designations, copyrights and other proprietary
rights in or associated with the products or services of the other Party.

                                   ARTICLE IX

                         LIMITATION OF LIABILITY; CLAIMS

         Section 9.1 No Consequential Damages. NONE OF THE PARTIES OR OTHER
MEMBERS OF THE CADENCE GROUP OR TALITY GROUP, AS THE CASE MAY BE, SHALL BE
LIABLE TO THE OTHER FOR ANY LOST PROFITS, LOSS OF DATA, LOSS OF USE, COST OF
COVER, BUSINESS INTERRUPTION OR OTHER SPECIAL, INCIDENTAL, INDIRECT, PUNITIVE OR
CONSEQUENTIAL DAMAGES, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY, ARISING
FROM THE PERFORMANCE OF, OR RELATING TO, THIS AGREEMENT.

         Section 9.2 Warranty. Tality Services to be marketed and sold pursuant
to this Agreement shall be subject to the standard warranty policies and
practices of the Partnership applicable at the time of sale, unless the Parties
otherwise agree in writing. THE PARTIES MAKE NO WARRANTY TO EACH OTHER, OR TO OR
FOR THE BENEFIT OF ANY CLIENT, with respect to any software, services or
products to be sold hereunder; and no warranty of any kind, whether written,
oral, implied or statutory, AND NO WARRANTIES OF MERCHANTABILITY or FITNESS FOR
A PARTICULAR PURPOSE, non-infringement or arising from course of dealing or
usage of trade, shall apply to any of such software, service or products.

         Section 9.3 Limitation of Claims. No action, regardless of form,
arising out of the rights or obligations set forth in this Agreement, may be
brought by either Party more than one (1) year after the cause of action has
accrued, except that an action for non-payment by the Partnership of any amount
due Cadence may be brought within one (1) year after the date of last payment.

                                    ARTICLE X

                               DISPUTE RESOLUTION

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         The Parties shall attempt in good faith to resolve any dispute,
controversy or claim (a "Dispute") arising in connection with this Agreement
informally according to the following procedure. Upon written request of a Party
identifying a Dispute to be resolved, each Party will designate a management
representative with the responsibility and authority to resolve the Dispute. The
designated management representatives shall meet preliminarily within fifteen
(15) days after the request is received from the requesting Party. At this first
meeting, the designated management representatives shall identify the scope of
the Dispute and the information needed to discuss and attempt to resolve the
Dispute. These management representatives shall then gather relevant information
regarding the Dispute and shall meet to discuss the issues and negotiate in good
faith to resolve the Dispute. Such second meeting shall occur within fifteen
(15) days after the first meeting. If no resolution is reached following such
second meeting, the designated management representatives from each Party shall
meet again within fifteen (15) days and negotiate in good faith to resolve the
Dispute. Should the designated executives be unable to produce a resolution,
such continuing Dispute shall be resolved in accordance with Section 4.4 of the
Separation Agreement.

                                   ARTICLE XI

                               GENERAL PROVISIONS

         Section 11.1 Assignment. Neither party may assign this Agreement or any
of its rights or obligations hereunder, without the prior written consent of the
other party (except in connection with a merger, consolidation or sale of all or
substantially all of the party's assets), and any such attempted assignment in
violation hereof shall be void.

         Section 11.2 Governing Law. This Agreement shall be construed in
accordance with and all Disputes hereunder shall be governed by the laws of the
State of California, excluding its conflict of law rules. The Superior Court of
Santa Clara County and/or the United States District Court for the Northern
District of California shall have jurisdiction and venue over all Disputes
between the parties that are permitted to be brought in a court of law pursuant
to Section 4.4 of the Separation Agreement.

         Section 11.3 Conflicting Agreements. In the event of any irreconcilable
conflict between this Agreement and the Separation Agreement, any other
Ancillary Agreement or other agreement executed in connection herewith or
therewith, the provisions of such other agreement shall prevail to the extent
that they specifically address the subject matter of the conflict.

         Section 11.4 Incorporation by Reference. Section 4.4 (subject to
Article X hereof) and all of the provisions of Article V (except for Sections
5.3 and 5.13 thereof) of the Separation Agreement are incorporated into and made
a part of this Agreement, as if fully set forth herein.

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         WHEREFORE, the parties have executed and delivered this Agreement
effective as of the date first set forth above.

CADENCE DESIGN SYSTEMS, INC.           TALITY, LP

By:                                    By:  TALITY CORPORATION,
Name:_________________________              AS GENERAL PARTNER
Title:                                     By:
                                           Name:_______________________________
                                           Title:

CADENCE HOLDINGS, INC.                 TALITY CORPORATION

By:                                    By:
Name:_________________________         Name:___________________________________
Title:                                 Title:

                                       11<PAGE>   1
                                                                   EXHIBIT 10.17

                            ASSET PURCHASE AGREEMENT

                                  BY AND AMONG

                          CADENCE DESIGN SYSTEMS, INC.,

                     CADENCE DESIGN SYSTEMS (CANADA) LIMITED

                                       AND

                            TALITY CANADA CORPORATION

                                   DATED AS OF

                                __________, 2000

<PAGE>   2

                            ASSET PURCHASE AGREEMENT

        THIS ASSET PURCHASE AGREEMENT (this "Agreement") is entered into as of
and effective on __________, 2000 by and among Cadence Design Systems, Inc., a
Delaware corporation ("Parent"), Cadence Design Systems (Canada) Limited, a
company organized under the laws of the Province of Nova Scotia ("Seller"), and
Tality Canada Corporation, a company also organized under the laws of the
Province of Nova Scotia ("Buyer"). Capitalized terms used herein and not
otherwise defined elsewhere herein shall have the meanings ascribed to them in
Article I.

                                    RECITALS

        WHEREAS, Seller intends to sell and Buyer intends to purchase the shares
of Westport Technology Company ("Westport") and certain of Seller's assets
related to the business of providing design services for electronic devices,
electronic system components and electronic systems, and assume certain
liabilities related to such assets;

        WHEREAS, the parties intend that, in exchange for consideration equal to
the Purchase Price (as defined below), Seller shall hereby transfer to Buyer on
the date hereof the shares of Westport and those assets set forth on Exhibit A
hereto (the "Transferred Assets") and Buyer shall hereby assume those
liabilities set forth on Exhibit B hereto (the "Transferred Liabilities",
together with the Transferred Assets, the "Purchased Assets"), as provided in
this Agreement.

                                   AGREEMENT

        NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements set forth below, the parties hereto agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

        "Buyer Group" means Buyer, the Partnership and any Subsidiary of the
Partnership.

        "Governmental Approvals" means any notices, reports or other filings to
be made with, or any consents, registrations, approvals, permits or
authorizations to be obtained from, any Governmental Authority.

        "Governmental Authority" means any federal, state, local, foreign or
international court or government, or any political subdivision thereof, or any
department, commission, board, bureau, agency, official or other regulatory,
administrative body of any such government or political subdivision thereof.

        "Partnership" means Tality, LP, a Delaware limited partnership wholly
owned by Tality and one or more wholly owned Subsidiaries of Parent.

        "Parent Group" means Parent and each Subsidiary and other affiliate of
Parent other than Buyer, the Partnership and Subsidiaries of the Partnership.

                                       1
<PAGE>   3

        "Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a Governmental Authority.

        "Subsidiary" of any Person means any other Person of which at least a
majority of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or other
body performing similar functions with respect to such other Person is directly
or indirectly owned or controlled by such Person, or by any one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries.

        "Tality" means Tality Corporation, a Delaware corporation and a
Subsidiary of Parent.

                                   ARTICLE II

                        PURCHASE, TRANSFER AND ASSUMPTION

        Section 2.1 Transfer of Assets and Assumption of Liabilities.

                (a) Transfer of Assets. On the date hereof, Seller hereby
assigns, transfers, conveys and delivers to Buyer, and Buyer hereby accepts from
Seller, all of Seller's right, title and interest in and to the Transferred
Assets and the beneficial and economic ownership of the Transferred Assets.
Delivery of the Transferred Assets shall take place in situ and on and from the
date hereof the Seller shall let the Buyer into possession of the Transferred
Assets.

                (b) Assumption of Liabilities. On the date hereof, Buyer hereby
assumes and agrees faithfully to perform and fulfill all the Transferred
Liabilities owed by Seller in accordance with their respective terms and shall
indemnify and hold harmless the Seller against the Transferred Liabilities and
all costs, claims, demands, liabilities and expenses in respect of the
Transferred Liabilities. Thereafter, Buyer shall be responsible for all
Transferred Liabilities owed by Seller, regardless of when or where such
Transferred Liabilities arose or arise, or whether the facts on which they are
based occurred prior to, on or after the date hereof, regardless of where or
against whom such Transferred Liabilities are asserted or determined or whether
asserted or determined prior to the date hereof.

                (c) Except as may be expressly set forth herein, all assets,
properties and other things of value to be transferred to, and all liabilities
to be assumed by, Buyer are being transferred or assumed, as applicable, "AS IS,
WHERE IS," and Buyer shall bear the economic and legal risk that any conveyance
shall prove to be insufficient to vest in Buyer good and marketable title, free
and clear of any lien, claim, equity or other encumbrance.

        Section 2.2 Purchase Price; Terms of Payment.

                (a) Determination of Purchase Price. Parent retained an
independent third party, Houlihan Lockey Howard & Zukin (the "Valuation
Expert"), to determine the fair market value of the Purchased Assets as of the
date of this Agreement (the "Purchase Price"). The parties hereby agree that the
purchase price to be paid for the Purchased Assets shall equal the Purchase
Price as so determined by the Valuation Expert and that subject to subparagraph
2.2(b)(ii) below, the determination of the Valuation Expert that the Purchase
Price equals

                                       2
<PAGE>   4

US$9,000,000 shall be final and binding on the parties. The cost of the
Valuation Expert shall be borne by Parent.

                (b) Terms of Payment of Purchase Price:

                    (i) On the date hereof, Buyer shall pay to Seller the
Purchase Price.

                    (ii) The parties hereto hereby express their intention that
the Purchased Assets are to be transferred at their fair market value. The basis
for the fair market value figure of the Purchased Assets is the valuation
referred to in paragraph 2.2(a). The parties recognize that the said fair market
value of the Purchased Assets may be determined to be higher or lower, as the
case may be, by the Canada Customs and Revenue Agency ("CCRA") than the Purchase
Price and in such event and to cover such case, the parties hereby agree as
follows:

                        (A)     the Seller and Buyer may notify CCRA that each
                                of them is prepared to:

                                (1)     have the fair market value figures used
                                        in this Agreement reviewed by CCRA;

                                (2)     take any and all requisite steps
                                        hereunder to settle any resulting
                                        increase or decrease in the fair market
                                        value figures; and

                                (3)     file a copy of this Agreement with CCRA,
                                        if any when requested to do so by CCRA;

                        (B)     the parties hereto will substitute CCRA's fair
                                market value figures for the fair market value
                                in this Agreement, and such substituted figure
                                shall be binding upon the parties hereto, unless
                                there is a valid objection to CCRA's substituted
                                figure;

                        (C)     any increase or decrease to the fair market
                                value of the Purchased Assets as used in this
                                Agreement shall result in the payment or return
                                on a dollar for dollar basis of an increase in
                                or a reduction to the Purchase Price, by a
                                corresponding amount. Interest shall be payable
                                on any payment envisaged hereunder from the date
                                hereof through the date of payment at the rate
                                of 6.0% compounded monthly.

                    (iii) Amounts required to be paid hereunder shall be paid by
wire transfer to an account designated by Seller or Buyer, as the case may be,
or by such other method agreed upon by Buyer and Seller.

                                       3
<PAGE>   5

                    (iv) Amounts due but not paid within the time prescribed
hereunder for payment shall accrue interest from the time so prescribed to the
time of payment at the rate of 10% compounded monthly or, if lower, the maximum
rate permitted by applicable law.

                (c) Taxes. In addition to the Purchase Price, the Buyer shall
pay to the Seller or to the appropriate taxing authority within the time limits
required by the applicable legislation all goods and services, sales, use,
consumption or transfer or other similar taxes to the extent required by any
federal, provincial or local legislation.

                (d) Further Documents. The parties agree to execute and file all
such agreements, elections and other documents as may be necessary or advisable
in order that the transactions shall be completed on a tax-deferred basis in
accordance with the rules set out in subsection 167(1) of the Excise Tax Act
(Canada), if applicable.

                (e) Allocation. The parties agree that the Purchase Price shall
be allocated among the Purchased Assets as set out on Schedule A.2, and for the
purposes of preparing financial statements and tax returns, the parties shall
use such allocation for all such purposes.

        Section 2.3 Classification of Transferred Assets.

                (a) Mistaken Allocations. There may exist (i) assets that the
parties discover were, contrary to the agreements between the parties, by
mistake or omission, included or not included, as the case may be, within the
Transferred Assets or (ii) liabilities that the parties discover were, contrary
to the agreements between the parties, by mistake or omission, included or not
included, within the Transferred Liabilities. The parties hereto acknowledge and
agree for greater certainty that any asset or liability transferred or assumed
in error is deemed not to form part of the Transferred Assets or Transferred
Liabilities and not to have been transferred to or assumed by the Buyer, and
shall be returned by the Buyer to the Seller. Any asset or liability forming
part of the Transferred Asset or Transferred Liability, as the case may be,
which was not conveyed to or assumed by the Buyer shall be conveyed or assumed
forthwith. The Person receiving or possessing such asset in error shall hold
such asset as bare trustee or nominee for the other Person. Each party shall
reimburse the other or make other financial adjustments (including cash
reserves) or other adjustments to remedy any mistakes or omissions relating to
any of the assets transferred hereby or any of the liabilities assumed hereby.

                (b) Documents Relating to Other Transfers of Assets and
Assumption of Liabilities. In furtherance of the assignment, transfer and
conveyance of the Transferred Assets and the assumption of the Transferred
Liabilities, simultaneously with the execution and delivery hereof or as
promptly as practicable thereafter, (i) Seller shall execute and deliver such
instruments of transfer, conveyance and assignment as and to the extent
necessary to evidence the transfer, conveyance and assignment of all of Seller's
right, title and interest in and to the Transferred Assets to Buyer; and (ii)
Buyer shall execute and deliver to Seller such assumptions of contracts and
other instruments of assumption as and to the extent necessary to evidence the
valid and effective assumption of the Transferred Liabilities by Buyer. Buyer
and Seller shall also cooperate to evidence the retention by Seller of any
Excluded Assets (as defined in Exhibit A).

                                       4
<PAGE>   6

        Section 2.4 Governmental Approvals and Third-Party Approvals.

                (a) Transfer In Violation of Laws or Contracts. If and to the
extent that the valid, complete and perfected transfer or assignment to Buyer of
any of the Purchased Assets would be a violation of applicable laws or require
any third-party approval or Governmental Approval, then, unless the parties
shall otherwise determine, the transfer or assignment to or from the Buyer, as
the case may be, of such Transferred Assets shall be automatically deemed
deferred and any such purported transfer or assignment shall be null and void
until such time as all legal impediments are removed and/or such third-party
approval or Governmental Approvals have been obtained. Notwithstanding the
foregoing, such asset shall still be considered a Transferred Asset for purposes
of determining whether any liability is a Transferred Liability; provided,
however, that if such third-party approvals or Governmental Approvals have not
been obtained within six months after the date hereof, the parties shall use
their reasonable commercial efforts to achieve an alternative solution in
accordance with the parties' intentions.

                (b) Transfers Not Consummated as of the Date Hereof. If the
transfer or assignment of any assets intended to be transferred or assigned
hereunder is not consummated prior to or on the date hereof, whether as a result
of the provisions of Section 2.4(a) or for any other reason, then the Person
retaining such asset shall thereafter hold such asset for the use and benefit,
insofar as reasonably possible, of the Person entitled thereto (at the expense
of the Person entitled thereto). In addition, the Person retaining such asset
shall take such other actions as may be reasonably requested by the Person to
whom such asset is to be transferred in order to place such Person, insofar as
reasonably possible, in the same position as if such asset had been transferred
as contemplated hereby and so that all the benefits and burdens relating to such
Transferred Assets, including possession, use, risk of loss, potential for gain,
and dominion, control and command over such assets, are to inure from and after
the date hereof to the Buyer (or the Seller, as the case may be). If and when
the third-party approvals and/or Governmental Approvals, the absence of which
caused the deferral of transfer of any asset pursuant to Section 2.4(a), are
obtained, the transfer of the applicable asset shall be effected in accordance
with the terms of this Agreement.

               (c) Expenses. The Person retaining an asset due to the deferral
of the transfer of such asset shall not be obligated, in connection with the
foregoing, to expend any money unless the necessary funds are advanced by the
Person entitled to the asset, other than reasonable out-of-pocket expenses,
attorneys' fees and recording or similar fees, all of which shall be promptly
reimbursed by the Person entitled to such asset.

        Section 2.5 Novation of Assumed Liabilities.

                (a) Reasonable Commercial Efforts. Each of Seller and Buyer, at
the request of the other, shall use all commercially reasonable efforts to
obtain, or to cause to be obtained, any consent, substitution, approval or
amendment required to novate all rights and obligations under agreements,
leases, licenses and other obligations or liabilities of any nature whatsoever
that constitute Transferred Liabilities or to obtain in writing the
unconditional release of all parties to such arrangements other than Buyer, so
that, in any such case, Buyer and its Subsidiaries shall be solely responsible
for such liabilities; provided, however, that none of Seller, Buyer and their
respective Subsidiaries shall be obligated to pay any consideration

                                       5
<PAGE>   7

therefor to any third party from whom such consents, approvals, substitutions
and amendments are requested.

                (b) Inability to Obtain Novation. If Seller or Buyer is unable
to obtain, or to cause to be obtained, any such required novation, consent,
approval, release, substitution or amendment, the applicable Person shall
continue to be bound by such agreements, leases, licenses and other obligations
and, unless not permitted by law or the terms thereof (except to the extent
expressly set forth in this Agreement), Buyer shall, as agent or subcontractor
for Seller or such other Person, as the case may be, pay, perform and discharge
fully, or cause to be paid, transferred or discharged all the obligations or
other liabilities of Seller or such other Person, as the case may be, thereunder
from and after the date hereof. Seller shall, without further consideration, pay
and remit, or cause to be paid or remitted, to Buyer or its appropriate
Subsidiary promptly all money, rights and other consideration received by it or
any other member of Parent Group in respect of such performance. If and when any
such consent, approval, release, substitution or amendment shall be obtained or
such agreement, lease, license or other rights or obligations shall otherwise
become assignable or able to be novated, Seller shall thereafter assign, or
cause to be assigned, all its rights, obligations and other liabilities
thereunder to Buyer without payment of further consideration and Buyer shall,
without the payment of any further consideration, assume such rights and
obligations.

                                   ARTICLE III

                                 OTHER COVENANTS

                Section 3.1 Retention of Records; Cooperation.

                (a) Buyer will for the maximum period required by law keep
safely and in reasonable condition all such books, records and documents and
other things relating to the Purchased Assets as Seller shall transfer or cause
to be transferred to Buyer and shall afford Seller reasonable access to such
books and records for so long as shall be necessary to enable Seller to deal
with its taxation (including GST and retail sales tax) liability in respect of
the period up to the date hereof and will permit Seller and Seller's servants,
agents and professional advisors to have access to and to take copies of such
records for such purpose.

                (b) Seller will for the maximum period required by law keep
safely and in reasonable condition any books, records and documents and other
things retained by Seller relating to the Purchased Assets and shall afford
Buyer reasonable access to such books and records for so long as shall be
necessary to enable Buyer properly to carry on the Business and will permit
Buyer and Buyer's servants, agents and professional advisors to have access to
and to take copies of such records for such purpose.

                Section 3.2 Terms of Buyer Employment. Subject to Section 4.6 of
the Separation Agreement, all basic terms and conditions of employment for
employees of Parent or Seller, who are transferred to the Buyer pursuant to this
Agreement, including, without limitation, their pay and benefits in the
aggregate, shall, to the extent legally and practicably possible, remain
substantially the same as the terms and conditions that were in place when the
employees were employed by Seller or Parent. Notwithstanding the foregoing, all
employees of Seller or Parent transferred to Buyer hereunder shall be required,
to the extent permissible under

                                       6
<PAGE>   8

applicable law, to execute new agreements regarding their employment status,
proprietary information and inventions in a form approved by the Buyer by the
date hereof, and also to execute such standard documents as are generally
executed by employees leaving their employment with Seller or Parent. For
greater certainty, any and all severance liability shall be and form part of the
Transferred Liabilities, whether or not an employee of Seller agrees to become
an employee of Buyer.

                                   ARTICLE IV

                                  MISCELLANEOUS

        Section 4.1 Limitation of Liability. In no event shall any party
hereunder be liable to another party, for any special, consequential, indirect,
incidental or punitive damages or lost profits, however caused and on any theory
of liability (including negligence) arising in any way out of this agreement or
any ancillary agreement, whether or not such party has been advised of the
possibility of such damages.

        Section 4.2 Buyer Acknowledgement. Buyer acknowledges that (a) it is
acquiring the Transferred Assets on an as is, where is basis, (b) it shall,
without investigation, objection or requisition accept such title as Seller has
to the Transferred Assets, and (c) accordingly, save as expressly set out in
this Agreement, no representations, warranties or other assurances of any kind
are given by or on behalf of Seller and on which Buyer may rely in entering into
this Agreement and on other statement, promise or forecast made by or on behalf
of Seller may form the basis of, or be pleaded in connection with, any claim by
Buyer under or in connection with this Agreement.

        Section 4.3 Entire Agreement. This Agreement and the Exhibits and
Schedules referenced or attached hereto, constitute the entire agreement between
the parties with respect to the subject matter hereof and thereof and shall
supersede all prior written and oral and all contemporaneous oral agreements and
understandings with respect to the subject matter hereof and thereof.

        Section 4.4 Governing Law. This Agreement shall be construed in
accordance with and all disputes hereunder shall be governed by the laws of the
State of Delaware, excluding its conflict of law rules. In the event of a
dispute the resolution of which is not otherwise addressed herein, such dispute
shall be resolved in accordance with the provisions of Exhibit C hereto.

        Section 4.5 Notices. Notices, offers, requests or other communications
required or permitted to be given by either party pursuant to the terms of this
Agreement shall be given in writing to the respective parties to the following
addresses:

if to Parent:

Cadence Design Systems, Inc.
2655 Seely Avenue, Bldg. 5
San Jose, CA 95134

Attention:   General Counsel

                                       7
<PAGE>   9

Fax:         (408) 944-6855

if to Buyer:

Tality Canada Corporation
2655 Seely Avenue, Bldg. 5
San Jose, CA 95134

Attention:   General Counsel
Fax:         (408) 944-6855

if to Seller:

Cadence Design Systems (Canada) Limited
2655 Seely Avenue, Bldg. 5
San Jose, CA 95134

Attention:   General Counsel
Fax:         (408) 428-4087

or to such other address as the party to whom notice is given may have
previously furnished to the other in writing as provided herein. Any notice
involving non-performance, termination, or renewal shall be sent by hand
delivery, recognized overnight courier or, within the United States, may also be
sent via certified U.S. mail, return receipt requested. All other notices may
also be sent by fax, confirmed by first class mail. All notices shall be deemed
to have been given and received on the earlier of actual delivery or three (3)
days from the date of postmark.

        Section 4.6 Counterparts. This Agreement and the Exhibits and Schedules
hereto, and the other documents referred to herein, may be executed in
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.

        Section 4.7 Binding Effect; Assignment. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective legal
representatives and successors, and nothing in this Agreement, express or
implied, is intended to confer upon any other Person any rights or remedies of
any nature whatsoever under or by reason of this Agreement. Neither Buyer nor
Seller may assign this Agreement or any rights or obligations hereunder, without
the prior written consent of the other party and Parent, and any such assignment
shall be void.

        Section 4.8 Severability. If any term or other provision of this
Agreement or any Ancillary Agreement, or any of the Exhibits and Schedules
attached hereto is determined by a court, administrative agency or arbitrator to
be invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any of the parties. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner to
the end that transactions contemplated hereby are fulfilled to the fullest
extent possible.

                                       8
<PAGE>   10

        Section 4.9 Failure or Delay Not Waiver; Remedies Cumulative. No failure
or delay on the part of any party hereto in the exercise of any right hereunder
shall impair such right or be construed to be a waiver of, or acquiescence in,
any breach of any representation, warranty or agreement herein, nor shall any
single or partial exercise of any such right preclude other or further exercise
thereof or of any other right. All rights and remedies existing under this
Agreement, or the Exhibits or Schedules attached hereto are cumulative to, and
not exclusive of, any rights or remedies otherwise available.

        Section 4.10 Amendment. No modification or amendment shall be made to
this Agreement, or the Exhibits or Schedules attached hereto, except by an
instrument in writing signed on behalf of each of the parties to such agreement.

        Section 4.11 Authority. Each of the parties hereto represents to the
others that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement; (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary
corporate or other actions; (c) it has duly and validly executed and delivered
this Agreement; and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.

        Section 4.12 Interpretation. The headings contained in this Agreement,
in any Exhibit or Schedule hereto and in the table of contents to this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Any capitalized term used in any Exhibit or
Schedule hereto but not otherwise defined therein, shall have the meaning
assigned to such term in this Agreement. When a reference is made in this
Agreement to an Article or a Section, Exhibit or Schedule, such reference shall
be to an Article or Section of, or an Exhibit or Schedule to, this Agreement, as
the case may be, unless otherwise indicated. All Exhibits and Schedules hereto
are incorporated into and made a part of this Agreement. The terms "including"
and "include" employed in this Agreement (including any of the Exhibits and
Schedules incorporated into and made a part of this Agreement) mean "including,
without limitation," and "includes, without limitation," respectively.

        Section 4.13 Payment of Expenses. Each of Buyer and Seller shall be
responsible for its own costs and expenses.

        Section 4.14 Transfer Taxes. Seller shall pay any and all sales, use,
transfer and other taxes in the nature of transfer taxes arising from the
transfers contemplated herein.

                                       9
<PAGE>   11

        WHEREFORE, the parties executed and delivered this Asset Purchase
Agreement as of the date first set forth above.

CADENCE DESIGN SYSTEMS (CANADA)           TALITY CANADA CORPORATION
LIMITED

By:                                       By:
   ---------------------------------         -----------------------------------

Name:                                     Name:
     -------------------------------           ---------------------------------

Title:                                    Title:
      ------------------------------            --------------------------------

CADENCE DESIGN SYSTEMS, INC.

By:
   ---------------------------------

Name:
     -------------------------------

Title:
      ------------------------------

                                       10

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