Cadence Aligns with IBM to Accelerate ASIC Design with Cadence Logic-Design Team Technology

• IBM 65-nm ASIC Design Kit to Incorporate Cadence Synthesis and Test Technologies;
• Companies Will Jointly Support ASIC Kit Customers

SAN JOSE, Calif. -- November 13, 2006 -- Cadence Design Systems, Inc. (NASDAQ: CDNS), the leader in global electronic-design innovation, today announced an agreement with International Business Machines Corporation (IBM) (NYSE: IBM), incorporating Cadence® Encounter® RTL Compiler global synthesis and Cadence Encounter Test technologies into the IBM 65-nanometer ASIC design kit. This new kit provides IBM's ASIC customers with an optimized path for automated test solutions and test logic-design processing at 65 nanometers. The companies will cooperatively support customers using the ASIC kit.

The collaboration offers IBM's ASIC customers a proven way to address logic- design challenges before handoff to IBM, accelerating the completion of higher quality designs. ASIC customers will gain access to Cadence Test and Synthesis technologies when they receive the 65-nanometer IBM ASIC design kit.

"For nearly two years, IBM has worked closely with Cadence to ensure that our ASIC clients continue to benefit from a differentiated test methodology that helps reduce their test development resources by implementing automated test pattern generation and diagnosis," said Rich Busch, director, ASIC Products Business Unit, IBM Technology Collaboration Solutions. "This has been accomplished by using Cadence synthesis and test technologies which are key components of our methodology to deliver industry leading shipped-product quality level (SPQL)."

"We are delighted about the outcome of this effort with IBM and the benefits our ASIC customers will gain," said Jim Miller, executive vice president, Products and Technologies Organization. "The new design kit, leveraging Cadence technologies, will enable ASIC customers to complete 65-nanometer ASIC designs more predictably and with fewer iterations."

About Cadence
Cadence enables global electronic-design innovation and plays an essential role in the creation of today's integrated circuits and electronics. Customers use Cadence software and hardware, methodologies, and services to design and verify advanced semiconductors, consumer electronics, networking and telecommunications equipment, and computer systems. Cadence reported 2005 revenues of approximately $1.3 billion, and has approximately 5,200 employees. The company is headquartered in San Jose, Calif., with sales offices, design centers, and research facilities around the world to serve the global electronics industry. More information about the company, its products, and services is available at www.cadence.com.