e424b3
 

Filed under Rule 424(b)(3) and (7) of the Securities Act of 1933,
relating to Registration No. 333-145000
Supplement No. 1
to Prospectus Dated July 31, 2007 and Prospectus Supplement Dated August 1, 2007
of
CADENCE DESIGN SYSTEMS, INC.
Relating to
$250,000,000 1.375% Convertible Senior Notes Due 2011
$250,000,000 1.500% Convertible Senior Notes Due 2013
and
Shares of Common Stock Issuable upon Conversion of the Notes
 
     This supplement no. 1 relates to the resale by selling securityholders of Cadence’s 1.375% Convertible Senior Notes Due 2011 (the “2011 Notes”) and 1.500% Convertible Senior Notes Due 2013 (the “2013 Notes” and, together with the 2011 Notes, the “Notes”) and the shares of Cadence common stock issuable upon conversion of the notes.
     You should read this supplement no. 1 in conjunction with the prospectus dated July 31, 2007 and the prospectus supplement dated August 1, 2007, which should be delivered in conjunction with this supplement. This supplement is not complete without, and may not be delivered or used except in conjunction with, the prospectus and prospectus supplement. This supplement is qualified by reference to the prospectus and prospectus supplement, except to the extent that the information provided by this supplement supersedes information contained in the prospectus supplement.
 
     Investing in the notes and the common stock issuable upon conversion of the notes involves risk. See the discussion entitled “Risk Factors” beginning on page S-6 of the prospectus supplement dated August 1, 2007.
 
     Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this supplement, the prospectus dated July 31, 2007, or the prospectus supplement dated August 1, 2007. Any representation to the contrary is a criminal offense.
 
     The tables under the caption “Selling Securityholders” beginning on page S-6 of the prospectus supplement are hereby supplemented and amended by adding certain selling securityholders identified in the tables below. We prepared these tables based on information supplied to us by the selling securityholders named in the tables below on or prior to August 31, 2007. Information about the selling securityholders may change over time. If required, any changed or new information given to us will be set forth in supplements to the prospectus supplement or amendments to the registration statement of which this supplement is a part, if and when necessary.
     We have assumed for purposes of the tables below that the selling securityholders will sell all of the notes and all of the common stock issuable upon conversion of the notes pursuant to this supplement, the prospectus supplement dated August 1, 2007, and the prospectus dated July 31, 2007, and that any other shares of our common stock beneficially owned by the selling securityholder will continue to be beneficially owned.
     Except as set forth below, the selling securityholders listed in the tables below do not have, nor within the past three years have had, any position, office or other material relationship with us or any of our predecessors or affiliates.

 

 

     The selling securityholders identified below may have sold, transferred or otherwise disposed of, pursuant to transactions exempt from the registration requirements of the Securities Act of 1933, as amended, all or a portion of its notes since the date on which it provided the information regarding its notes.
SELLING SECURITYHOLDERS OF THE 2011 NOTES
                                             
                                    Number of    
    Principal                           Shares of    
    Amount           Number of           Common   Natural
    of Notes           Shares of   Number   Stock   Person(s)
    Beneficially   Percentage   Common   of Shares   Beneficially   with
    Owned and   of Notes   Stock   of Common   Owned after   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Stock   the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   Offered (1)   Offering(2)(3)   Power
Froley Revy Alternative Strategies
    750,000     *     35,461       35,461       0     Ann Houlihan
JP Morgan Securities Inc.(#)
    7,450,000       2.98       352,246       352,246       0     Brad Crouch
Citigroup Global Markets Inc. (#)
    6,430,000       2.57       304,019       304,019       0     Citigroup Global Markets Inc.
Lord Abbett Investment Trust — LA Convertible Fund
    2,850,000       1.14       134,752       134,752       0     Maren Lindstrom
Lord Abbett Series Fund — Bond Debenture Portfolio
    250,000     *     11,820       11,820       0     Maren Lindstrom
Intl. Truck & Engine Corp Non Contributory Retirement Plan Trust
    580,000     *     27,423       27,423       0     Maren Lindstrom
Intl. Truck & Engine Corp. Retirement Plan for Salaried Employee’s Trust
    290,000     *     13,712       13,712       0     Maren Lindstrom
KeySpan Insurance Company
    130,000     *     6,147       6,147       0     Maren Lindstrom
Vermont Mutual Insurance Company
    115,000     *     5,437       5,437       0     Maren Lindstrom
Commissioners of the Land Office
    1,020,000     *     48,227       48,227       0     Maren Lindstrom

2

 

                                             
                                    Number of    
    Principal                           Shares of    
    Amount           Number of           Common   Natural
    of Notes           Shares of   Number   Stock   Person(s)
    Beneficially   Percentage   Common   of Shares   Beneficially   with
    Owned and   of Notes   Stock   of Common   Owned after   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Stock   the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   Offered (1)   Offering(2)(3)   Power
Wachovia Bank, NA, as Trustee for the SCI Cemetery Merchandise Common Trust
    135,000     *     6,383       6,383       0     Maren Lindstrom
Wachovia Bank, NA, as Trustee for the SCI Pre-Need Common Trust Fund
    85,000     *     4,019       4,019       0     Maren Lindstrom
Pension, Hospitalization Benefit Plan of the Electrical Ind Plan
    520,000     *     24,583       24,583       0     Maren Lindstrom
NFS — SCI Funeral and Merchandise Fixed Common Trust
    220,000     *     10,402       10,402       0     Maren Lindstrom
Total Fina Elf Finance USA, Inc.
    240,000     *     11,348       11,348       0     Maren Lindstrom
Met Investor Series Trust — Bond Debenture
    1,800,000     *     85,106       85,106       0     Maren Lindstrom
B.C. McCabe Foundation
    100,000     *     4,728       4,728       0     Maren Lindstrom
National Fuel & Gas Company Retirement Plan
    440,000     *     20,804       20,804       0     Maren Lindstrom
KeySpan Foundation
    50,000     *     2,364       2,364       0     Maren Lindstrom
Philadelphia Board of Pensions
    550,000     *     26,005       26,005       0     Maren Lindstrom
NYC Teachers’ Variable Annuity Fund
    1,400,000     *     66,194       66,194       0     Maren Lindstrom
Oakwood Healthcare Inc. Funded Depreciation
    195,000     *     9,220       9,220       0     Nick Calamos
Oakwood Healthcare Inc. Pension
    500,000     *     23,641       23,641       0     Nick Calamos
Oakwood Healthcare Inc. Endowment / A & D
    20,000     *     946       946       0     Nick Calamos
Oakwood Healthcare Inc. — OHP
    28,000     *     1,324       1,324       0     Nick Calamos

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                                    Number of    
    Principal                           Shares of    
    Amount           Number of           Common   Natural
    of Notes           Shares of   Number   Stock   Person(s)
    Beneficially   Percentage   Common   of Shares   Beneficially   with
    Owned and   of Notes   Stock   of Common   Owned after   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Stock   the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   Offered (1)   Offering(2)(3)   Power
Oakwood Assurance Company Ltd.
    95,000     *     4,492       4,492       0     Nick Calamos
Delta Airlines Master Trust
    1,950,000     *     92,199       92,199       0     Nick Calamos
Munson Medical Center Retirement Plan
    255,000     *     12,057       12,057       0     Nick Calamos
Munson2 Healthcare Board Designated Operating Fund
    280,000     *     13,239       13,239       0     Nick Calamos
American Beacon Funds
    305,000     *     14,421       14,421       0     Nick Calamos
Port Authority of Allegheny County Consolidated Trust Fund
    160,000     *     7,565       7,565       0     Nick Calamos
North Dakota State Investment Board
    940,000     *     44,444       44,444       0     Nick Calamos
Oakwood Healthcare Inc. — Professional Liability
    21,000     *     993       993       0     Nick Calamos
Oakwood Healthcare Inc. — Working Capital
    67,000     *     3,168       3,168       0     Nick Calamos
Univar USA Inc. Retirement Plan
    1,375,000     *     65,012       65,012       0     Nick Calamos
Port Authority of Allegheny County Retirement and Disability Allowance Plan for the Employees Represented by Local 85 of the Amalgamated Transit Union
    1,750,000     *     82,742       82,742       0     Nick Calamos
The Dow Chemical Company Employees’ Retirement Plan
    5,300,000       2.12       250,591       250,591       0     Nick Calamos
Dorinco Reinsurance Company
    2,550,000       1.02       120,567       120,567       0     Nick Calamos
City of Knoxville Pension System
    425,000     *     20,095       20,095       0     Nick Calamos

4

 

                                             
                                    Number of    
    Principal                           Shares of    
    Amount           Number of           Common   Natural
    of Notes           Shares of   Number   Stock   Person(s)
    Beneficially   Percentage   Common   of Shares   Beneficially   with
    Owned and   of Notes   Stock   of Common   Owned after   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Stock   the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   Offered (1)   Offering(2)(3)   Power
Macomb County Employees’ Retirement System
    900,000     *     42,553       42,553       0     Nick Calamos
Knoxville Utilities Board Retirement System
    390,000     *     18,440       18,440       0     Nick Calamos
Boilermakers — Blacksmith Pension Trust
    5,100,000       2.04       241,135       241,135       0     Nick Calamos
Aventis Pension Master Trust
    860,000     *     40,662       40,662       0     Nick Calamos
Delta Pilots Disability and Survivorship Trust
    1,100,000     *     52,009       52,009       0     Nick Calamos
SCI Endowment Care Common Trust Fund — Regions Bank
    320,000     *     15,130       15,130       0     Nick Calamos
SCI Endowment Care Common Trust Fund — SunTrust Bank
    145,000     *     6,856       6,856       0     Nick Calamos
Union Carbide Retirement Account
    2,725,000       1.09       128,842       128,842       0     Nick Calamos
Prisma Foundation
    355,000     *     16,785       16,785       0     Nick Calamos
SCI Endowment Care Common Trust Fund — US Bank, NA
    95,000     *     4,492       4,492       0     Nick Calamos
US Bank FBO Essentia Health Services
    380,000     *     17,967       17,967       0     Nick Calamos
SPT
    2,550,000       1.02       120,567       120,567       0     Nick Calamos
CEMEX Pension Plan
    460,000     *     21,749       21,749       0     Nick Calamos
CALAMOS Convertible Fund — CALAMOS Investment Trust
    16,500,000       6.60       780,141       780,141       0     Nick Calamos
Peoples Benefit Life Insurance Company Teamsters
    10,500,000       4.20       496,454       496,454       0     Alex Lach
Bank of America Pension Plan
    2,000,000     *     94,563       94,563       0     Alex Lach
Redbourn Partners Ltd.
    4,500,000       1.80       212,766       212,766       0     Alex Lach
Retail Clerks Pension Trust 2
    1,000,000     *     47,281       47,281       0     Alex Lach

5

 

                                             
                                    Number of    
    Principal                           Shares of    
    Amount           Number of           Common   Natural
    of Notes           Shares of   Number   Stock   Person(s)
    Beneficially   Percentage   Common   of Shares   Beneficially   with
    Owned and   of Notes   Stock   of Common   Owned after   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Stock   the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   Offered (1)   Offering(2)(3)   Power
DeepRock & Co
    1,000,000     *     47,281       47,281       0     Alex Lach
John Deere Pension Trust
    1,000,000     *     47,281       47,281       0     Alex Lach
 
*   Less than one percent (1%).
 
#   The selling securityholder is a registered broker-dealer.
 
+   The selling securityholder is an affiliate of a registered broker-dealer.
 
(1)   Assumes conversion of all of the holder’s notes at a conversion rate of 47.2813 shares of common stock per $1,000 principal amount at maturity of the notes. This conversion rate is subject to adjustment as described under “Description of Notes—Conversion Rights.” As a result, the number of shares of common stock issuable upon conversion of the notes may increase or decrease in the future. Further, pursuant to the terms of the notes, upon conversion we will pay cash and shares of our common stock, if any, based on a daily settlement amount calculated on a proportionate basis for each day of the relevant 20 trading-day observation period. Accordingly, the number of shares of our common stock we would actually deliver upon conversion of any notes would be lower than the numbers shown for any holder of notes in the table above. The numbers of shares set forth in the table above exclude shares of common stock that may be issued as described under “Description of Notes — Adjustment to Shares Delivered upon Conversion Upon a Fundamental Change” and the fractional shares. Holders will receive a cash adjustment for any fractional share amount resulting from conversion of the notes, as described under “Description of Notes — Conversion Rights.”
 
(2)   The number of shares of common stock beneficially owned by each holder named above is less than 1% of our outstanding common stock, calculated based on 277,528,689 shares of common stock outstanding as of June 30, 2007. In calculating this amount for each holder, we treated as outstanding the number of shares of common stock issuable upon conversion of all of that holder’s notes, but we did not assume conversion of any other holder’s notes.
 
(3)   For the purposes of computing the number and percentage of notes and shares to be held by the selling securityholders after the conclusion of the offering, we have assumed for purposes of the table above that the selling securityholder named above will sell all of the notes and all of the common stock issuable upon conversion of the notes offered by this supplement no. 1, the prospectus supplement dated August 1, 2007 and the prospectus dated July 31, 2007, and that any other shares of our common stock beneficially owned by the selling securityholder will continue to be beneficially owned. We also assume that unnamed holders of notes, or any future transferees, pledgees, donees or successors of from any such holder, do not beneficially own any common stock other than that issuable upon conversion of the notes.
 
(4)   The maximum principal amount of 2011 Notes that may be sold under the prospectus dated July 31, 2007, the prospectus supplement dated August 1, 2007 and all supplements thereto will not exceed $250,000,000.
SELLING SECURITYHOLDERS OF THE 2013 NOTES
                                                 
    Principal                           Number of    
    Amount of           Number of   Number   Shares of   Natural
    Notes           Shares of   of Shares   Common   Person(s)
    Beneficially   Percentage   Common   of Common   Stock   with
    Owned and   of Notes   Stock   Stock   Beneficially   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Offered   Owned after the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   (1)   Offering(2)(3)   Power
JP Morgan Securities Inc.(#)
    6,112,000       2.44       288,983       288,983       0     Brad Crouch

6

 

                                                 
    Principal                           Number of    
    Amount of           Number of   Number   Shares of   Natural
    Notes           Shares of   of Shares   Common   Person(s)
    Beneficially   Percentage   Common   of Common   Stock   with
    Owned and   of Notes   Stock   Stock   Beneficially   Voting or
Name of Selling   Offered   Outstanding   Beneficially   Offered   Owned after the   Investment
Securityholder   (USD)(4)   (%)   Owned(1)(2)   (1)   Offering(2)(3)   Power
CALAMOS Growth & Income Fund — CALAMOS Investment Trust
    48,908,000       19.56       2,312,434       2,312,434       0     Nick Calamos
North Slope Borough
    238,000       *       11,253       11,253       0     Nick Calamos
Cal Farley’s Boys Ranch Foundation
    196,000       *       9,267       9,267       0     Nick Calamos
Dunham Appreciation and Income Fund (#)
    280,000       *       13,239       13,239       0     Nick Calamos
CALAMOS Growth & Income Portfolio — CALAMOS Advisors Trust
    298,000       *       14,090       14,090       0     Nick Calamos
Ellington Overseas Partners, LTD
    4,000,000       1.60       189,125       189,125       0       (5 )
 
*   Less than one percent (1%).
 
#   The selling securityholder is a registered broker-dealer.
 
+   The selling securityholder is an affiliate of a registered broker-dealer.
 
(1)   Assumes conversion of all of the holder’s notes at a conversion rate of 47.2813 shares of common stock per $1,000 principal amount at maturity of the notes. This conversion rate is subject to adjustment as described under “Description of Notes—Conversion Rights.” As a result, the number of shares of common stock issuable upon conversion of the notes may increase or decrease in the future. Further, pursuant to the terms of the notes, upon conversion we will pay cash and shares of our common stock, if any, based on a daily settlement amount calculated on a proportionate basis for each day of the relevant 20 trading-day observation period. Accordingly, the number of shares of our common stock we would actually deliver upon conversion of any notes would be lower than the numbers shown for any holder of notes in the table above. The numbers of shares set forth in the table above exclude shares of common stock that may be issued as described under “Description of Notes — Adjustment to Shares Delivered upon Conversion Upon a Fundamental Change” and the fractional shares. Holders will receive a cash adjustment for any fractional share amount resulting from conversion of the notes, as described under “Description of Notes — Conversion Rights.”
 
(2)   The number of shares of common stock beneficially owned by each holder named above is less than 1% of our outstanding common stock, calculated based on 277,528,689 shares of common stock outstanding as of June 30, 2007. In calculating this amount for each holder, we treated as outstanding the number of shares of common stock issuable upon conversion of all of that holder’s notes, but we did not assume conversion of any other holder’s notes.
 
(3)   For the purposes of computing the number and percentage of notes and shares to be held by the selling securityholders after the conclusion of the offering, we have assumed for purposes of the table above that the selling securityholder named above will sell all of the notes and all of the common stock issuable upon conversion of the notes offered by this supplement no. 1, the prospectus supplement dated August 1, 2007 and the prospectus dated July 31, 2007, and that any other shares of our common stock beneficially owned by the selling securityholder will continue to be beneficially owned. We also assume that unnamed holders of notes, or any future transferees, pledgees, donees or successors of from any such holder, do not beneficially own any common stock other than that issuable upon conversion of the notes.
 
(4)   The maximum principal amount of 2013 Notes that may be sold under the prospectus dated July 31, 2007, the prospectus supplement dated August 1, 2007 and all supplements thereto will not exceed $250,000,000.

7

 

(5)   Ellington Management Group, LLC is the investment adviser of the selling security holder. Michael Vranos, as principal of Ellington Management Group, LLC, has voting and investment control of the securities offered hereby. Mr. Vranos disclaims beneficial ownership over the Registrable Securities except to the extent of any indirect ownership interest he may have in such securities through his economic participation in the selling security holder.
 
The date of this supplement no. 1 is September 4, 2007.

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