Document:

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                                                                   EXHIBIT 10.54

                                PLEDGE AGREEMENT

               This PLEDGE AGREEMENT (this "Agreement"), is made effective as of
the ____ day of July, 2000, by ______________ (the "Buyer") to Cadence Design
Systems, Inc., a Delaware corporation ("Cadence").

               PRELIMINARY STATEMENTS:

               1. The Buyer has purchased from Cadence ____________ shares of
Class A Common Stock, par value $0.001 per share (the "Shares"), of Tality
Corporation, a Delaware corporation and wholly owned subsidiary of Cadence,
pursuant to a Common Stock Purchase Agreement, dated as of even date herewith
(the "Purchase Agreement"), between Buyer and Cadence. The Buyer has paid a
portion of the purchase price for such Shares with a Secured Promissory Note of
even date herewith made in favor of Cadence (the "Note").

               2. In order to assure the payment of the Note, the Buyer has
agreed to grant to Cadence a security interest in the Shares as collateral for
the Buyer's performance of its obligations under the Note.

               AGREEMENT:

               NOW, THEREFORE, in consideration of the premises set forth herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereby agree as follows:

               SECTION 1. Pledge. The Buyer hereby pledges to Cadence, and
grants Cadence a security interest in, all of the Buyer's right, title and
interest in and to the Shares, the certificates representing the Shares, and all
dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any of the
Shares (the "Pledged Collateral").

               SECTION 2. Security for Obligations. The pledge and security
interest granted in Section 1 hereof is given solely to secure the obligation of
the Buyer to pay amounts due under the Note, including without limitation
payments of principal, interest or any other amount that may be payable by Buyer
pursuant to the terms of the Note, including any and all modifications,
extensions, or renewals thereof (the "Secured Obligations").

               SECTION 3. Delivery; Redelivery

               (a) Simultaneously with the execution and delivery hereof, the
Buyer shall deliver to Cadence the certificates representing the Shares,
together with instruments of transfer with respect thereto duly executed by the
Buyer in blank. Promptly after receipt, the Buyer shall deliver any other
certificates representing the Pledged Collateral, also

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accompanied by such instruments of transfer.

               (b) During the term of the pledge hereunder, Cadence shall not be
entitled to register the certificates representing the Pledged Collateral in its
name or to exercise any voting or other rights of stockholders of Cadence in
respect of the Pledged Collateral. Prior to the sale of the Pledged Collateral
pursuant to Section 5, and subject to the terms and conditions of the Purchase
Agreement, all rights in respect of the Pledged Collateral, including without
limitation the rights to vote and receive dividends (subject to the terms
hereof), may be exercised by the Buyer, notwithstanding the pledge contemplated
hereby.

               (c) Subject to Cadence's rights under the Purchase Agreement,
including without limitation the drag-along right, repurchase option and right
of first refusal as more fully set forth therein, Cadence shall redeliver the
Pledged Collateral at such time as all Secured Obligations have been paid in
full. When such redelivery is required, Cadence shall also execute and deliver
to the Buyer such documents as the Buyer shall reasonably request, at Buyer's
expense, to evidence the termination of this Agreement and the pledge
contemplated hereby.

               SECTION 4. Occurrence of Default. As used in this Agreement, an
"Occurrence of Default" shall have occurred in the event of:

               (i) the occurrence of an Event of Default under the Note, as
defined therein; or

               (ii) the failure of Buyer punctually and completely to observe,
keep or perform any covenant, agreement or condition required by this Agreement.

               SECTION 5. Remedies upon Occurrence of Default:

               (a) If an Occurrence of Default has occurred and is continuing,
Cadence may sell the Pledged Collateral in a commercially reasonable manner in
accordance with Chapter 9 of the California Uniform Commercial Code. As an
alternative to a commercially reasonable sale, if an Occurrence of Default has
occurred and is continuing, Cadence may propose that it keep the Pledged
Collateral in accordance with Chapter 9 of the California Uniform Commercial
Code.

               (b) All cash proceeds received by Cadence in respect of any sale
of the Pledged Collateral shall first be applied by Cadence to the reasonable
costs and expenses of sale, and then to the payment of the Secured Obligations.
Any surplus of proceeds remaining after payment in full of the Secured
Obligations shall be paid over to the Buyer.

               (c) BUYER HEREBY IRREVOCABLY CONSTITUTES AND APPOINTS CADENCE AS
THE PROXY AND ATTORNEY-IN-FACT OF BUYER WITH RESPECT TO THE PLEDGED COLLATERAL,
INCLUDING THE RIGHT TO VOTE THE SHARES, WITH FULL POWER OF SUBSTITUTION TO DO
SO. THE APPOINTMENT OF CADENCE AS PROXY AND ATTORNEY-IN-FACT IS COUPLED

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WITH AN INTEREST AND SHALL BE IRREVOCABLE UNTIL REDELIVERY OF THE PLEDGED
COLLATERAL PURSUANT TO SECTION 3(c). IN ADDITION TO THE RIGHT TO VOTE THE
SHARES, THE APPOINTMENT OF BUYER AS PROXY AND ATTORNEY-IN-FACT SHALL INCLUDE THE
RIGHT TO EXERCISE ALL OTHER RIGHTS, POWERS, PRIVILEGES AND REMEDIES TO WHICH A
HOLDER OF THE PLEDGED COLLATERAL WOULD BE ENTITLED (INCLUDING GIVING OR
WITHHOLDING WRITTEN CONSENTS OF SHAREHOLDERS, MEMBERS OR PARTNERS, AS THE CASE
MAY BE, CALLING SPECIAL MEETINGS OF SHAREHOLDERS, MEMBERS OR PARTNERS, AS
APPLICABLE, AND VOTING AT SUCH MEETINGS). SUCH PROXY SHALL BE EFFECTIVE,
AUTOMATICALLY AND WITHOUT THE NECESSITY OF ANY ACTION (INCLUDING ANY TRANSFER OF
ANY PLEDGED COLLATERAL ON THE RECORD BOOKS OF THE ISSUER THEREOF) BY ANY PERSON
(INCLUDING THE ISSUER OF THE PLEDGED COLLATERAL OR ANY OFFICER OR AGENT
THEREOF), UPON THE OCCURRENCE AND DURING THE CONTINUATION OF AN OCCURRENCE OF
DEFAULT. NOTWITHSTANDING THE FOREGOING, BUYER SHALL NOT HAVE ANY DUTY TO
EXERCISE ANY SUCH RIGHT OR TO PRESERVE THE SAME AND SHALL NOT BE LIABLE FOR ANY
FAILURE TO DO SO OR FOR ANY DELAY IN DOING SO.

               SECTION 6. Amendments. Etc. No amendment or waiver of any
provision of this Agreement shall in any event be effective unless the same
shall be in writing and signed by the parties hereto, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.

               SECTION 7. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing (including facsimile
communication) and mailed, transmitted or delivered to the addresses set forth
below, or, as to any party, to it at such other address as shall be designated
by such party in a written notice to each other party complying as to delivery
with the terms of this Section. All such notices and other communications shall,
when mailed, telegraphed, telexed, cabled or faxed, be effective when deposited
in the mails, delivered to the telegraph company, confirmed by telex answerback,
confirmed received or delivered to the cable company or confirmed received in
the case of a facsimile, in each case addressed as follows:

               If to Cadence:       Cadence Design Systems, Inc.
                                    2655 Seely Avenue
                                    San Jose, California  95134
                                    Attn:
                                         -----------------------

               With a copy to:      Cadence Design Systems, Inc.
                                    2655 Seely Avenue
                                    San Jose, California  95134
                                    Attn:
                                         -----------------------

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               If to Buyer:
                                        ------------------------
                                        ------------------------
                                        ------------------------

               SECTION 8. Severability. The provisions of this Agreement are
severable, and if any clause or provision hereof shall be held invalid or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect only such clause or provision, or part thereof, in
such jurisdiction, and shall not in any manner affect such clause or provision
in any other jurisdiction, or any other clause or provision of this Agreement in
any jurisdiction.

               SECTION 9. GOVERNING LAW. THE VALIDITY, INTERPRETATION,
CONSTRUCTION, AND PERFORMANCE OF ALL OF THE TERMS OF THIS AGREEMENT SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT GIVING EFFECT TO THE
PRINCIPLES OF CONFLICTS OF LAWS OF CALIFORNIA THAT WOULD PROVIDE FOR THE
APPLICATION OF ANY OTHER LAW.

               SECTION 10. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute but one
and the same instrument.

               SECTION 11. Arbitration.

               (a) The parties shall use good faith negotiation to resolve any
claim, controversy, dispute or disagreement arising out of or relating to this
Agreement or the breach of this Agreement. Any matter not resolved by
negotiation, including disputes concerning whether a dispute is subject to
arbitration, shall be submitted to binding arbitration pursuant to this Section
11; provided, however, that the terms and provisions of this Section 11 shall
not preclude any party hereto from seeking, or a court of competent jurisdiction
from granting, a temporary restraining order, temporary injunction or other
equitable relief for any breach of any duty, obligation, covenant,
representation or warranty set forth in this Agreement, the breach of which may
cause irreparable harm or damage.

               (b) Arbitration shall be commenced by a written demand for
arbitration, describing in reasonable detail the dispute and the amount and
nature of the relief sought, given by one party hereto to the other party and to
the office of the American Arbitration Association (the "AAA") in San Jose,
California.

               (c) The arbitration shall be conducted by a single arbitrator
chosen in accordance with the AAA rules.

               (d) Each arbitration hearing shall be held at a place in San
Jose, California, acceptable to the arbitrator. The arbitration shall be
conducted in accordance with the Commercial Arbitration Rules of the AAA to the
extent such rules do not conflict with the terms of this Section 11. The
decision of the arbitrator shall be reduced to writing and shall be binding on
the parties. Judgment upon the award(s) rendered by the arbitrator

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may be entered and execution had in any court of competent jurisdiction or
application may be made to such court for a judicial acceptance of the award and
an order of enforcement. The charges and expenses of the arbitrator shall be
shared equally by the parties to the hearing. The arbitration shall commence
within ten days after the arbitrator is selected in accordance with the
provisions of this Section 11. In fulfilling his or her duties with respect to
determining the amount of any loss or claim, the arbitrator may consider such
matters as, in the opinion of the arbitrator, are necessary or helpful to make a
proper valuation. The arbitrator shall not award any special, punitive,
exemplary, indirect or consequential damages, whether or not such special,
punitive, exemplary, indirect or consequential damages would be permissible
under applicable law. As to any determination of the amount of any loss, or as
to the resolution of any other claim, controversy, dispute or disagreement, that
under the terms hereof is made subject to arbitration, no lawsuit based on such
claimed loss or such resolution shall be instituted by any of the parties to
this Agreement, other than to compel arbitration proceedings or enforce the
award of the arbitrator. All privileges under California and federal law,
including attorney-client and work-product privileges, shall be preserved and
protected to the same extent that such privileges would be protected in a
federal court proceeding applying California law.

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               IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and delivered by its officer thereunto duly authorized as of
the date first above-written.

                                        BUYER:

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

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

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

                                        Name:
                                             -----------------------------------
                                            (Spouse)

                                        CADENCE DESIGN SYSTEMS, INC.

                                        By:
                                           -------------------------------------
                                        Name:
                                             -----------------------------------
                                        Title:
                                              ----------------------------------

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<PAGE>   7

                             FORM OF PROMISSORY NOTE

                              San Jose, California

$_______________                                                  July ___, 2000

        FOR VALUE RECEIVED, _____________________________ (name) promises to pay
to the order of Cadence Design Systems, Inc., a Delaware corporation, at its
offices located at 2655 Seely Avenue, San Jose, California (or such other place
as the Payee or any other holder hereof may from time to time hereafter
designate), in United States Dollars, the sum of
____________________________________________________________________ DOLLARS
($____________________________________), together with interest at the rate of
6.51% per annum, compounded semi-annually.

        1. Definitions. As used in this Note, the following terms shall have the
respective meanings indicated:

        (a) "Business Day" means a day when the Payee is open for business.

        (b) "Bankruptcy Code" shall mean Title 11 of the United State Code, as
amended.

        (b) An "Event of Default" shall be deemed to occur upon any of the
following events:

                (i) the failure to pay any amounts due under this Secured
        Promissory Note as and when due and payable, if such failure continues
        for five (5) days after the date any such amounts are due and payable;
        or

                (ii) the failure of Maker punctually and completely to observe,
        keep or perform any covenant, agreement or condition required by this
        Secured Promissory Note (other than the payment obligations referred to
        in paragraph (i) above);

                (iii) there shall be commenced against Maker an involuntary
        petition under the Bankruptcy Code, or any other applicable law, or an
        involuntary case or proceeding seeking the appointment of a receiver,
        liquidator, sequestrator, custodian, trustee or other officer having
        similar powers of Maker or to take possession of all or a substantial
        portion of Maker's property, and any of the following events occur: (a)
        Maker consents to the institution of such involuntary case or
        proceeding; (b) the petition commencing the involuntary case or
        proceeding is not timely controverted; (c) the petition commencing such
        involuntary case or proceeding remains undismissed and unstayed for a
        period of 60 days; or (d) an order for relief shall have been issued or
        entered therein;

                (iv) Maker shall institute a voluntary case under the Bankruptcy
        Code or any similar proceeding under any other applicable law, or shall
        consent thereto; or shall consent to the conversion of an involuntary
        case to a voluntary case; or shall file a petition, answer a complaint
        or otherwise institute any proceeding seeking, or shall consent to or
        acquiesce in the appointment of, a receiver, liquidator, sequestrator,
        custodian, trustee or other officer with similar powers of Maker or to
        take possession of all or a substantial portion of Maker's property, or
        shall make a general assignment for the benefit of creditors;

<PAGE>   8

                (v) termination of Maker's employment with Payee for any reason
        whatsoever, with or without cause; provided, however, that if such
        termination would entitle Maker to severance or other benefits under a
        written change in control or severance agreement between Maker and
        Payee, such termination shall not be an Event of Default hereunder; or

                (vi) sale by Maker of the shares of Class A Common Stock of
        Tality Corporation, a Delaware corporation, securing this Secured
        Promissory Note pursuant to the Pledge Agreement (as hereinafter
        defined).

        (c) "Highest Lawful Rate" means the maximum nonusurious rate of interest
permitted by applicable federal or California laws, whichever from time to time
permits the higher maximum nonusurious interest rate. The Payee may from time to
time, as to current and future balances, implement any other ceilings permitted
under applicable law and/or revise the index, formula or provision of law used
to compute the rate or rates of interest on this Secured Promissory Note by
notice to the Maker or any other person or entity, and the Highest Lawful Rate
shall fluctuate upward and downward as and in the amount by which the maximum
rate of interest permitted by applicable federal or California law, whichever
from time to time permits the higher maximum nonusurious rate, fluctuates.

        (d) "Maker" means _________________________ (name).

        (e) "Maturity Date" means the maturity date of this Secured Promissory
Note, July 16, 2007, as the same may hereafter be accelerated pursuant to the
provisions of this Note.

        (f) "Payee" means Cadence Design Systems, Inc., a Delaware corporation.

        2.     Payments.

        (a) The principal and accrued interest of this Note shall be due and
payable in a single payment on the Maturity Date.

        (b) If any payment provided for in this Note shall become due on a day
other than a Business Day, such payment may be made on the next succeeding
Business Day (unless the result of such extension or time would be to extend the
date for such payment into another calendar month or beyond the Maturity Date,
and in either such event such payment shall be made on the Business Day
immediately preceding the day on which such payment would otherwise have been
due), and such extension of time shall in such case be included in the
computation of interest on this Secured Promissory Note.

        3. Past Due Payments. All principal on this Secured Promissory Note more
than five (5) calendar days past due shall bear interest at the lower of ten
percent (10%) per annum or the Highest Lawful Rate.

        4. No Usury Intended. Notwithstanding any provision to the contrary
contained in this Secured Promissory Note, it is expressly provided that in no
case or event shall the aggregate of (a) all interest on the unpaid balance of
this Secured Promissory Note, accrued or paid from the date hereof and (b) the
aggregate of any other amounts accrued or paid pursuant to this Secured
Promissory Note which under applicable laws are or may be deemed to constitute
interest upon the indebtedness evidenced by this Secured Promissory Note from
the date hereof, ever exceed the Highest Lawful Rate. In this connection, it is
expressly stipulated and agreed that it is the intent of the Maker and the Payee
to contract in strict compliance with the applicable usury laws of the State of
California and of the United States, whichever from time to time permit the
higher rate of interest.

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        5. Security. Maker acknowledges that his obligations under this Secured
Promissory Note are fully recourse and are secured by a Pledge Agreement of even
date herewith (the "Pledge Agreement").

        6. Event of Default. Upon the occurrence and continuation of an Event of
Default, the owner or holder hereof may, at its, his or her option, exercise any
or all rights, powers and remedies afforded by law including the right to
declare the unpaid balance of principal and accrued interest on this Secured
Promissory Note at once mature and payable and to set-off against the amounts
then owing under this Secured Promissory Note any and all monies, securities and
other properties of the Maker in the possession, custody or control of or on
deposit with, or otherwise owed to the Maker by, the Payee or any other holder
hereof, including without limitation (i) all such monies, securities and other
properties held in general or special accounts or for safekeeping or as
collateral or otherwise, including without limitation securities to be issued
upon exercise of options, or (ii) Maker's salary and any bonus payments that
would otherwise be payable to Maker. Without limiting any other remedies Payee
may have as a result of an Event of Default, upon the occurrence and
continuation of an Event of Default, Payee may exercise its remedies under the
Pledge Agreement.

        7. No Waiver by the Payee. No delay or omission of the Payee or any
other holder hereof to exercise any power, right or remedy accruing to the Payee
or any other holder hereof shall impair any such power, right or remedy or shall
be construed to be a waiver of the right to exercise any such power, right or
remedy.

        8. Costs and Attorneys' Fees. If any holder of this Secured Promissory
Note retains any attorney in connection with any default or to collect, enforce
or defend this Secured Promissory Note in any lawsuit or in any probate,
reorganization, bankruptcy or other proceeding, or if the Maker sues any holder
in connection with this Secured Promissory Note and does not prevail, then Maker
agrees to pay to each such holder, in addition to principal and interest, all
reasonable costs and expenses incurred by such holder in trying to collect this
Secured Promissory Note or in any such suit or proceeding, including reasonable
attorney' fees.

        9. Waiver by the Maker. Maker waives notice (including, but not limited
to, notice of intent to accelerate, notice of dishonor, notice of protest and
notice of acceleration), demand, presentment for payment, protest and the filing
of suit for the purpose of fixing liability and consents that the time of
payment hereof may be extended and re-extended from time to time without notice
to Maker, and Maker agrees that his or her liability on or with respect to this
Secured Promissory Note shall not be affected by any release of or change in any
security at any time existing or by any failure to perfect or to maintain
perfection of any lien on or security interest in any such security.

        10. Paragraph Headings. Paragraph headings appearing in this Secured
Promissory Note are for convenient reference only and shall not be used to
interpret or limit the meaning of any provision of this Secured Promissory Note.

        11. Governing Law. This Secured Promissory Note shall be governed by and
construed in accordance with the laws of the State of California (without giving
effect to the principles of conflicts of laws of California that would provide
for the application of any other State law) and the United States of America
from time to time in effect.

        12. Successors and Assigns. This Secured Promissory Note and all the
covenants and agreements contained herein shall be binding upon, and shall inure
to the benefit of, the respective legal representatives, heirs, successors and
assigns of the Maker and the Payee.

        13. Severability. If any provision of this Secured Promissory Note shall
be determined by any court of competent jurisdiction to be illegal or
unenforceable, then that

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<PAGE>   10

provision only shall be of no force and effect and shall be deemed excised
herefrom, and the remainder of this provisions of this Secured Promissory Note
shall be enforced.

        14. Notices to the Maker. Any notice required by the terms of this
Secured Promissory Note to be given to the Maker shall be deemed given on the
day actually delivered to the Maker or, if mailed, when deposited in the United
States mail, postage prepaid, certified or registered mail, addressed to the
Maker at ______________________________ or at such address as the Maker may,
from time to time, specify in writing delivered to the Payee.

        15. Prepayment. The Maker may at any time pay the full amount or any
part of this Secured Promissory Note without the payment of any premium or fee.

                            [SIGNATURES ON NEXT PAGE]

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

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

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

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

                                        Name:
                                             -----------------------------------
                                                   (Spouse)

                                      -5-
<PAGE>   12

                                    EXHIBIT B

                ACKNOWLEDGMENT AND STATEMENT OF TAX CONSEQUENCES

        The undersigned (which term includes the undersigned's spouse), a
purchaser of ___________ shares of Common Stock (the "Shares") of Tality
Corporation, a Delaware corporation (the "Company"), from Cadence Design
Systems, Inc. ("Cadence") pursuant to a Common Stock Purchase Agreement dated
_______, hereby states as follows:

        1. The undersigned has been informed by Cadence that there are material
federal, state and local tax considerations that must be taken into account in
connection with the purchase of the Shares. Such consequences could include, but
are not limited to, incurring a liability for income tax as a result of the
purchase.

        2. The undersigned either [check and complete as applicable]:

        (a)___ has consulted, and has been fully advised by, the
               undersigned's own tax advisor, whose name is
               _____________________________________, and whose business address
               is ______________________________, regarding the federal, state
               and local tax consequences of purchasing the Shares, and
               particularly regarding the advisability of making an election
               pursuant to Section 83(b) of the Internal Revenue Code of 1986,
               as amended (the "Code") and pursuant to the corresponding
               provisions, if any, of applicable state law; or

        (b)___ has knowingly chosen not to consult such a tax advisor.

        3. Neither Cadence, the Company nor any of its affiliates, employees,
officers, directors, attorneys or accountants has made any warranty or
representation to the undersigned with respect to the tax consequences of the
undersigned's purchase of Shares.

Date:
     ------------------------------     ----------------------------------------
                                                   Purchaser

Date:
     ------------------------------     ----------------------------------------
                                                   Spouse

<PAGE>   13

Instruction: Please do not fill in any blanks other than the signature line. The
purpose of this assignment is to enable Cadence to exercise its Repurchase
Option set forth in the Common Stock Purchase Agreement without requiring
additional signature on the part of Purchaser.

                                    EXHIBIT C

                      ASSIGNMENT SEPARATE FROM CERTIFICATE

        FOR VALUE RECEIVED and pursuant to that certain Common Stock Purchase
Agreement between the undersigned ("Purchaser") and Cadence Design Systems, Inc.
("Cadence") dated _______, (the "Agreement"), Purchaser hereby sells, assigns
and transfers unto Cadence _________________________________ (________) shares
of the Common Stock of _____ (the "Company") standing in Purchaser's name on the
books of the Company and represented by Certificate No. ____, and does hereby
irrevocably constitute and appoint
________________________________________________ to transfer said stock on the
books of the Company with full power of substitution in the premises. THIS
ASSIGNMENT MAY ONLY BE USED AS AUTHORIZED BY THE AGREEMENT AND THE ATTACHMENTS
THERETO.

Dated:
      ------------------------------

                                        Signature:

                                        ----------------------------------------
                                        Purchaser

                                        ----------------------------------------
                                        Spouse (if applicable)<PAGE>   1
                                                                   EXHIBIT 10.55

                                PROMISSORY NOTE

$2,803,000.00                                             Menlo Park, California
                                                        As of September 18, 2000

        FOR VALUE RECEIVED, the undersigned, RONALD R. BARRIS AND SUSAN E.
BARRIS (collectively, the "Borrower"), hereby promise to pay to the order of 849
COLLEGE AVENUE, INC., a California corporation (the "Lender"), with an address
c/o Cadence Design Systems, Inc., 2655 Seely Avenue, Bldg. 5, San Jose,
California 95134 the principal sum of TWO MILLION EIGHT HUNDRED THREE THOUSAND
AND NO/100 DOLLARS ($2,803,000.00) (the "Loan") made by the Lender to the
Borrower on the dates and in the amounts set forth below.

        1. Accrual and Calculation of Interest. Interest shall accrue on the
outstanding principal balance of this Promissory Note (this "Note"), and the
Loan evidenced hereby at an interest rate equal to six percent (6%) per annum,
compounded semi-annually (the "Interest Rate"). Interest shall be computed
hereunder based upon a 360-day year, and shall accrue for each and every day
(365 days per year, 366 days per leap year) on which any indebtedness remains
outstanding hereunder. Payments in federal funds immediately available in the
place designated for payment received by Lender prior to 2:00 pm local time at
said place of payment shall be credited prior to the close of business, wile
other payments may, at the option of Lender, not be credited until immediately
available to Lender in federal funds in the place designated for payment prior
to 2:00 pm local time. This Note is secured by a certain Deed of Trust With
Assignment of Rents of even date herewith given by Borrower in favor of Lender
and filed for record in the Official Records of San Mateo County, California
(the "Deed of Trust").

        2. Payments of Principal and Interest. (a) Borrower shall make payments
of principal and interest as follows: On the Maturity Date (as hereinafter
defined) all principal, together with all accrued interest thereon shall be due
and payable in full.

               (b) As used herein, the term "Maturity Date" means the earlier of
(i) the 180th day after the termination of Ronald R. Barris' employment with
Cadence Design Systems, Inc., a Delaware corporation ("Cadence"), the sole
shareholder of Lender (such termination date being hereinafter referred to as
the "Employment Termination Date"), (ii) the date on which Borrower sells the
Property (as defined in the Deed of Trust), and (iii) September 18, 2008.

               (c) In addition to the interest at the Interest Rate payable by
Borrower under this Note, and all other sums payable by Borrower to Lender in
connection with the Loan, Borrower shall pay to Lender as additional interest,
at the time or times and in the manner hereinafter described, the Contingent
Interest (as hereinafter defined). Contingent Interest, if any, shall be due and
payable upon any sale or disposition of the Property that occurs after the date
hereof and before the date that is 181 days after the Employment Termination
Date, and Borrower agrees to give notice to Lender of the occurrence of any such
sale or disposition not less than thirty (30) days in advance thereof.

                                       1
<PAGE>   2

               (d) As used in this Note, "Contingent Interest" means an amount
equal to (i) ninety percent (90%) of the amount by which the sale price for the
Property (including all cash and any non-cash consideration) exceeds $2,903,000
(the "Resale Participation Amount"), less (ii) the sum of (A) the amount of
accrued interest under this Note and (B) the reasonable and customary closing
costs incurred by a seller in the county in which the Property is located
(including escrow costs, recording fees, documentary transfer tax and the CLTA
portion of a title policy). If, during the term of this Note, Borrower has made
substantial capital improvements to the Property which have been approved in
writing by Cadence, then the Resale Participation Amount shall be decreased by
an amount equal to the reasonable costs of such improvements, as approved by
Cadence in writing.

        3. Limit of Validity. The provisions of this Note and of all agreements
between Borrower and Lender, whether now existing or hereafter arising and
whether written or oral, are hereby expressly limited so that in no contingency
or event whatsoever, whether by reason of demand or acceleration of the maturity
of this Note or otherwise, shall the amount paid, or agreed to be paid
("Interest") to Lender for the use, forbearance or retention of the money loaned
under this Note exceed the maximum amount permissible under applicable law. If,
from any circumstance whatsoever, performance or fulfillment of any provision
hereof or of any agreement between Borrower and Lender shall, at the time
performance or fulfillment of such provision shall be due, exceed the limit for
Interest prescribed by law or otherwise transcend the limit of validity
prescribed by applicable law, then ipso facto the obligation to be performed or
fulfilled shall be reduced to such limit and if, from any circumstance
whatsoever, Lender shall ever receive anything of value deemed Interest by
applicable law in excess of the maximum lawful amount, an amount equal to any
excessive Interest shall be applied to the reduction of the principal balance
owing under this Note in the inverse order of its maturity (whether or not then
due) or at the option of Lender be paid over to Borrower, and not to the payment
of Interest. All Interest (including any amounts or payments deemed to be
Interest) paid or agreed to be paid to Lender shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the full
period until payment in full of the principal balance of this Note so that the
Interest thereof for such full period will not exceed the maximum amount
permitted by applicable law. This Section 3 will control all agreements between
Borrower and Lender.

        4. Miscellaneous. The terms and provisions hereof shall be binding upon
and inure to the benefit of Borrower and Lender and their respective heirs,
executors, legal representatives, successors, successors-in-title and assigns,
whether by voluntary action of the parties or by operation of law. As used
herein, the terms "Borrower" and "Lender" shall be deemed to include their
respective heirs, executors, legal representatives, successors,
successors-in-title and assigns, whether by voluntary action of the parties or
by operation of law. If Borrower consists of more than one person or entity,
each shall be jointly and severally liable to perform the obligations of
Borrower under this Note. All personal pronouns used herein, whether used in the
masculine, feminine or neuter gender, shall include all other genders; the
singular shall include the plural and vice versa. Titles of articles and
sections are for convenience only and in no way define, limit, amplify or
describe the scope or intent of any provisions hereof. Time is of the essence
with respect to all provisions of this Note. This Note and the Deed of Trust
contain the entire agreements between the parties hereto relating to the subject
matter hereof and thereof, and any and all prior written agreements and any and
all prior and contemporaneous oral agreements relative hereto and thereto which
are not contained herein or therein are terminated.

                                       2
<PAGE>   3

        All payments due hereunder shall be made to the Lender at the time and
place, in the type of funds, and in the manner set forth above, without any
deduction whatsoever, including, without limitation, any deduction for any
set-off, recoupment, counterclaim or taxes. The Borrower hereby waives
diligence, presentment, demand, protest, notice of dishonor and all other
demands and notices in connection with the execution, delivery, performance or
enforcement of this Note. The Borrower promises to pay all costs and expenses,
including attorneys' fees and disbursements, incurred in the collection or
enforcement hereof.

        THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF CALIFORNIA. THE BORROWER AND, BY ACCEPTANCE HEREOF, THE
LENDER WAIVE THE RIGHT TO A TRIAL BY JURY IN ANY ACTION UNDER THIS NOTE OR ANY
ACTION ARISING OUT OF THE TRANSACTIONS CONTEMPLATED HEREBY, REGARDLESS OF WHICH
PARTY INITIATES SUCH ACTION OR ACTIONS.

                                        "BORROWER":

Date:
     ----------------------------       ----------------------------------------
                                        Ronald R. Barris

Date:
     ----------------------------       ----------------------------------------
                                        Susan E. Barris

                                       3

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