Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On December 15, 2008, the Compensation Committee of the Board of Directors ("Board") of Cadence Design Systems, Inc. ("Cadence") approved a cash payment of $250,000 and an option grant to purchase 100,000 shares of common stock (the "Shares") to Lip-Bu Tan, Interim Vice Chairman of the Board, for his service as a member of the Interim Office of the Chief Executive ("IOCE"). The cash payment will be made and the option will vest and become exercisable with respect to 100% of the Shares upon the earlier of: (i) January 15, 2009; or (ii) the first day of employment of a Chief Executive Officer of Cadence, as such first day is determined by the Compensation Committee of the Board; provided that Mr. Tan is a member of the IOCE as of the day immediately prior to the applicable date on which the cash payment would be due and the option would vest and become exercisable.
Item 8.01. Other Events.

On December 12, 2008, Cadence received a letter from The NASDAQ Stock Market ("Nasdaq") indicating that Cadence has regained compliance with the filing requirements under Nasdaq Marketplace Rule 4310(c)(14) because it filed its Quarterly Report on Form 10-Q for the quarter ended September 27, 2008 with the Securities and Exchange Commission on December 11, 2008.

---

Table of Contents