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                                                                   Exhibit 10.09

                          CADENCE DESIGN SYSTEMS, INC.
                       CHIEF EXECUTIVE OFFICER BONUS PLAN
                        EFFECTIVE AS OF JANUARY 1, 1996


The purpose of the Chief Executive Officer Bonus Plan (the "Plan") is to
motivate and reward that individual who is serving as the Company's Chief
Executive Officer ("CEO") to improve the Company's profitability and achieve the
established corporate goals of the Company. The Plan provides for a cash payment
after the end of the Company's fiscal year ending December 31, 1996 and after
the end of each subsequent fiscal year. The Company's financial performance for
a given fiscal year will be based on the audited financial statements prepared
by the Company's outside accounting firm. Amounts paid under the Plan are
intended to be "performance-based compensation" within the meaning of section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), and the
Plan shall be interpreted in accordance with that intent.

The target bonus amount for the CEO will be established by the Compensation
Committee of the Board of Directors for a given fiscal year within the first
ninety (90) days of that fiscal year. The target bonus amount shall be expressed
as a percentage of the CEO's base salary for that fiscal year, which base salary
shall also be established by the Compensation Committee of the Board of
Directors within the first ninety (90) days of that fiscal year.

The CEO's actual bonus for a given fiscal year shall be determined by the
Company's achievement of the Earnings Per Share ("EPS") target established by
the Compensation Committee of the Board of Directors for a given fiscal year
within the first ninety (90) days of that fiscal year. For purposes of the Plan,
"Earnings Per Share" shall be determined by applying generally accepted
accounting principles ("GAAP") and excluding the impact of any significant
unusual or non-recurring items. If the Earnings Per Share target is equalled by
the Company's performance, then the CEO's actual bonus shall be equal to the
target bonus amount for such year. If the Company's performance exceeds the
Earnings Per Share target, then the CEO's actual bonus shall be greater than the
target bonus amount for such year. If the Company's performance fails to reach
the Earnings Per Share target, then the CEO's actual bonus shall be less than
the target bonus amount for such year, and in some cases it is possible that no
bonus may be paid. The schedule setting forth the relationship between the
Company's financial performance for a given fiscal year expressed in terms of
Earnings Per Share and the CEO's actual bonus shall be established by the
Compensation Committee of the Board of Directors for a given fiscal year within
the first ninety (90) days of that fiscal year.

In the event that the Company's actual Earnings Per Share for a fiscal year
falls between two of the numbers for Earnings Per Share selected by the
Compensation Committee of the Board of Directors on the schedule ("EPS
Numbers"), then the percentage of the CEO's target bonus amount which will be
paid as the CEO's actual bonus (the "amount percentage") shall be determined by
the sum of the following two percentages: (1) the "amount percentage" matched
with the lower of the two EPS Numbers on the schedule plus (2) the product
(rounded to the next higher full percentage point) of the number of percentage
points between the "amount percentages" for the two EPS Numbers, multiplied by a
fraction, the numerator of which is the difference between the Company's actual
Earnings Per Share and the lower EPS Number and the denominator of which is the
number of cents between the two EPS Numbers.

In no event may the CEO's actual bonus for a given fiscal year exceed
$2,000,000.

The CEO's actual bonus for a given fiscal year shall be reduced by the amount
which the CEO receives with respect to the same fiscal year under the terms of
the Company's Senior Executive Bonus Plan for that fiscal year.

The amount of the CEO's actual bonus for a given fiscal year shall be certified
in writing by the Compensation Committee of the Board of Directors prior to
payment.

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Any individual who serves as the Company's Chief Executive Officer for a given
fiscal year shall automatically be eligible to participate in the Plan. If an
individual becomes Chief Executive Office during a fiscal year, that
individual's target bonus amount, base salary, EPS target, and schedule of
adjustments to the target bonus amount based upon actual EPS results, shall be
established by the Compensation Committee before the first 25% of the remainder
of that fiscal year has elapsed. These determinations of the Compensation
Committee shall be applied to the period of time remaining in the fiscal year
after the individual became Chief Executive Officer, or such shorter period of
time within the fiscal year determined by the Compensation Committee. In order
to receive a bonus payment under the Plan for a given fiscal year, the
individual must be employed by the Company on the date that bonus checks are
distributed for that fiscal year, or have terminated employment prior to that
time on account of death or disability.

The Compensation Committee of the Board of Directors may terminate the Plan at
any time, for any or no reason, and may also amend the Plan in order to reduce
the amount of the CEO's bonus payment at any time, for any or no reason. The
Compensation Committee of the Board of Directors shall be responsible for all
matters of interpretation of the terms of the Plan, including the authority to
make decisions regarding matters not expressly addressed in the Plan, and the
decision of the Compensation Committee shall be final and binding on all persons
having an interest in the Plan.

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