On October 9, 2009, Magma Design Automation, Inc. ("Magma") entered into the Third Amendment (the "Amendment") to the Credit Agreement, effective as of October 31, 2008, between Magma and Wells Fargo Bank, National Association ("Wells Fargo").

The Amendment provides for (i) a single revolving line of credit note of $15 million to replace the two previous $7.5 million revolving line of credit notes,
(ii) eliminates the requirement that Magma maintain a minimum accounts receivable borrowing base, and (iii) extends the term of the line of credit to September 30, 2010. The Amendment also, among other things, requires that Magma provide certain financial statements to Wells Fargo, amends or removes certain financial covenants and amends the definition of "Event of Default."

The Amendment is attached hereto as Exhibit 10.1 and is incorporated by reference herein.

(d) Exhibits.

Exhibit
  No.        Description

10.1         Third Amendment to Credit Agreement, effective as of October 1, 2009,
             between Magma and Wells Fargo