<PAGE> 1
As filed with the Securities and Exchange Commission on December 27, 1996
Registration No. 333-_____
- --------------------------------------------------------------------------------
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
-----------------------------
HNC SOFTWARE INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 33-0248788
(State of Incorporation) (I.R.S. Employer
Identification No.)
5930 CORNERSTONE COURT WEST
SAN DIEGO, CALIFORNIA 92121-3728
(Address of Principal Executive Offices)
1995 EQUITY INCENTIVE PLAN
OPTIONS GRANTED BY RETEK DISTRIBUTION CORPORATION ASSUMED BY THE REGISTRANT
(Full Title of the Plan)
-----------------------------
RAYMOND V. THOMAS
CHIEF FINANCIAL OFFICER
HNC SOFTWARE INC.
5930 CORNERSTONE COURT WEST
SAN DIEGO, CALIFORNIA 92121-3728
(619) 546-8877
(Name, Address and Telephone Number of Agent for Service)
-----------------------------
Copies to:
KENNETH A. LINHARES, ESQ.
TYLER R. COZZENS, ESQ.
G. CHIN CHAO, ESQ.
FENWICK & WEST LLP
TWO PALO ALTO SQUARE
PALO ALTO, CALIFORNIA 94306
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===============================================================================================================================
TITLE OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO BE REGISTERED REGISTERED OFFERING PRICE PER SHARE AGGREGATE OFFERING PRICE REGISTRATION FEE
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.001 par value 1,750,000 (1) $27.875(2) $48,781,250.00(2) $14,782.20(3)
Common Stock, $0.001 par value 155,864 (4) $8.53(5) $1,329,846.70 $402.98(3)
===============================================================================================================================
</TABLE>
(1) Additional shares available for grant and not yet subject to
outstanding stock options as of December 27, 1996 under the 1995 Equity
Incentive Plan.
(2) Estimated as of December 23, 1996 pursuant to Rule 457(c) solely for
the purpose of calculating the registration fee.
(3) Fee calculated pursuant to Section 6(b) of the Securities Act of 1933,
as amended. This amount equals 1/33 of 1% of the proposed maximum
aggregate offering price.
(4) Shares subject to assumed Retek Distribution Corporation options as of
December 27, 1996.
(5) Weighted average per share exercise price for such outstanding options
pursuant to Rule 457(h)(1).
<PAGE> 2
HNC SOFTWARE INC.
REGISTRATION STATEMENT ON FORM S-8
PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference:
(a) The Registrant's latest annual report filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), or the latest prospectus
filed by the Registrant pursuant to Rule 424(b) under the
Securities Act of 1933, as amended (the "Securities Act"),
that contains audited financial statements for the
Registrant's latest fiscal year for which such statements have
been filed.
(b) All other reports filed pursuant to Sections 13(a) or 15(d) of
the Exchange Act since the end of the fiscal year covered by
the annual report or prospectus referred to in (a) above.
(c) The description of the Registrant's Common Stock contained in
the Registrant's Registration Statement filed with the
Commission under Section 12 of the Exchange Act, including any
amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities registered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed incorporated by reference herein and to be a part hereof from the date
of the filing of such documents.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the issuance of the shares of Common Stock offered
hereby will be passed upon for the Company by Fenwick & West LLP, Palo Alto,
California. Members of the firm of Fenwick & West LLP own an aggregate of 3,314
shares of Common Stock of the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by Section 145 of the Delaware General Corporation Law,
the Registrant's Certificate of Incorporation includes a provision that
eliminates the personal liability of its directors to the Registrant or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability: (i) for any breach of the director's duty of loyalty to
the corporation or its stockholders; (ii) for acts or omissions not in good
faith or that involve intentional misconduct or a knowing violation of law;
(iii) under Section 174 of the Delaware General Corporation Law; or (iv) for any
transaction from which the director derived an improper personal benefit.
In addition, as permitted by Section 145 of the Delaware General
Corporation Law, the Bylaws of the Registrant provide that: (i) the Registrant
is required to indemnify its directors and officers as well as directors and
officers of any other corporation, partnership or other enterprise when they are
serving in such capacities at the request of the Registrant to the fullest
extent permitted by the Delaware General Corporation Law; (ii) the Registrant
may, in its discretion, indemnify other officers, employees and
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<PAGE> 3
agents as set forth in the Delaware General Corporation Law; (iii) upon receipt
of an undertaking to repay such advances if indemnification is determined to be
unavailable, the Registrant is required to advance expenses, as incurred, to its
directors and officers to the fullest extent permitted by the Delaware General
Corporation Law in connection with a proceeding (except that it is not required
to advance expenses to a person against whom the Registrant brings a claim for
breach of the duty of loyalty, failure to act in good faith, intentional
misconduct, knowing violation of law or deriving an improper personal benefit);
(iv) the rights conferred in the Bylaws are not exclusive and the Registrant is
authorized to enter into indemnification agreements with its directors, officers
and employees and agents; (v) the Registrant may not retroactively amend the
Bylaw provisions in a way that adversely affects the indemnification provided
thereunder.
The Registrant's policy is to enter into indemnity agreements
with each of its directors and officers. The indemnity agreements provide that
directors and officers will be indemnified and held harmless to the fullest
possible extent permitted by law, including against all expenses (including
attorneys' fees), judgments, fines and settlement amounts paid or reasonably
incurred by them in any action, suit or proceeding, including any derivative
action by or in the right of the Registrant, on account of their services as
directors or officers of the Registrant or as directors or officers of any other
corporation, partnership or other enterprise when they are serving in such
capacities at the request of the Registrant. The Registrant is not obligated
pursuant to the agreements to indemnify or advance expenses to an indemnified
party with respect to proceedings or claims (i) initiated by the indemnified
party and not by way of defense, except with respect to a proceeding authorized
by the Board of Directors and successful proceedings brought to enforce a right
to indemnification under the indemnity agreements; (ii) for any amounts paid in
settlement of a proceeding unless the Registrant consents to such settlement;
(iii) on account of any suit in which judgment is rendered against the
indemnified party for an accounting of profits made from the purchase or sale by
the indemnified party of securities of the Registrant pursuant to the provisions
of 16(b) of the Securities Exchange Act of 1934 and related laws; (iv) on
account of conduct by an indemnified party that is finally adjudged to have been
in bad faith or conduct that the indemnified party did not reasonably believe to
be in, or not opposed to, the best interests of the Registrant; (v) on account
of any criminal action or proceeding arising out of conduct that the indemnified
party had reasonable cause to believe was unlawful; or (vi) if a final decision
by a court having jurisdiction in the matter shall determine that such
indemnification is not lawful.
The indemnity agreement requires a director or officer to
reimburse the Registrant for expenses advanced only to the extent it is
ultimately determined that the director or officer is not entitled, under
Delaware law, the Bylaws, his or her indemnity agreement or otherwise, to be
indemnified for such expenses. The indemnity agreement provides that it is not
exclusive of any rights a director or officer may have under the Certificate of
Incorporation, the Bylaws, other agreements, any majority-in-interest vote of
the stockholders or vote of disinterested directors, Delaware law, or otherwise.
The indemnification provision in the Bylaws, and the indemnity
agreements entered into between the Registrant and its directors and officers,
may be sufficiently broad to permit indemnification of the Registrant's
directors and officers for liabilities arising under the Securities Act.
The indemnity agreements require the Registrant to maintain
director and official liability insurance to the extent readily available. The
Registrant currently carries a director and officer insurance policy.
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<PAGE> 4
ITEM 8. EXHIBITS.
4.01 HNC Software Inc. 1995 Equity Incentive Plan, as amended
through December 6, 1996.
4.02 Form of 1995 Equity Incentive Plan Stock Option Agreement and
Stock Option Exercise Agreement.(1)
4.03 Form of Retek Distribution Corporation Nonqualified Stock
Option Agreement.(2)
4.04 Registrant's Restated Certificate of Incorporation filed with
the Secretary of State of Delaware on June 13, 1996.(3)
4.05 Registrant's Bylaws, as amended.(3)
4.06 Form of specimen certificate for Registrant's Common Stock.(4)
5.01 Opinion of Fenwick & West LLP.
23.01 Consent of Fenwick & West LLP (included in Exhibit 5.01).
23.02 Consent of Price Waterhouse LLP, Independent Accountants.
24.01 Power of Attorney (see page 6 ).
- ------------------------
(1) Incorporated by reference from Exhibit 10.02 to the Company's
Registration Statement on Form S-1 (File No. 33-91932) filed on May
5, 1995, and as subsequently amended.
(2) Retek Distribution Corporation is a British Virgin Islands
corporation that is an international business company formed under
the British Virgin Islands' International Business Companies Act,
and was acquired by the Registrant on November 29, 1996.
(3) Filed as Exhibit 3(i).04 (Restated Certificate of Incorporation) and
Exhibit 3(ii).05 (Bylaws) with the Company's Report on Form 10-Q for
the quarter ended June 30, 1996 as originally filed on August 13,
1996.
(4) Incorporated by reference from Exhibit 4.01 to the Company's
Registration Statement on Form S-1 (File No. 33-91932) filed on May
5, 1995, and as subsequently amended.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in the volume
of securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the
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<PAGE> 5
low and high end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a twenty
percent (20%) change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the
Registration Statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions discussed in Item 6 hereof, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered hereby, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
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<PAGE> 6
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each individual whose signature
appears below constitutes and appoints Robert L. North and Raymond V. Thomas,
and each of them, his true and lawful attorneys-in-fact and agents with full
power of substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement on Form S-8, and to file the same with all
exhibits thereto and all documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully to
all intents and purposes as he or it might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of
them, or his or their substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Diego, State of California, on the 27th day
of December, 1996.
HNC SOFTWARE INC.
By: /s/ Raymond V. Thomas
--------------------------------
Raymond V. Thomas
Vice President, Finance and
Administration, Chief Financial
Officer and Secretary
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
PRINCIPAL EXECUTIVE OFFICER:
/s/ Robert L. North President, Chief Executive Officer December 27, 1996
- ------------------------------------ and a Director
Robert L. North
PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER:
/s/ Raymond V. Thomas Vice President, Finance and Administration December 27, 1996
- ------------------------------------ Chief Financial Officer and Secretary
Raymond V. Thomas
ADDITIONAL DIRECTORS:
/s/ Edward K. Chandler Director December 27, 1996
- ------------------------------------
Edward K. Chandler
/s/ Oliver D. Curme Director December 27, 1996
- ------------------------------------
Oliver D. Curme
/s/ Roger L. Evans Director December 27, 1996
- ------------------------------------
Roger L. Evans
/s/ Thomas F. Farb Director December 27, 1996
- ------------------------------------
Thomas F. Farb
/s/ Charles H. Gaylord Director December 27, 1996
- ------------------------------------
Charles H. Gaylord, Jr.
</TABLE>
-PAGE 6-
<PAGE> 7
EXHIBIT INDEX
Exhibit No. Description
4.01 HNC Software Inc. 1995 Equity Incentive Plan, as amended through
December 6, 1996.
4.02 Form of 1995 Equity Incentive Plan Stock Option Agreement and Stock
Option Exercise Agreement.(1)
4.03 Form of Retek Distribution Corporation Nonqualified Stock Option
Agreement.(2)
4.04 Registrant's Restated Certificate of Incorporation filed with the
Secretary of State of Delaware on June 13, 1996.(3)
4.05 Registrant's Bylaws, as amended.(3)
4.06 Form of specimen certificate for Registrant's Common Stock.(4)
5.01 Opinion of Fenwick & West LLP.
23.01 Consent of Fenwick & West LLP (included in Exhibit 5.01).
23.02 Consent of Price Waterhouse LLP, Independent Accountants.
24.01 Power of Attorney (see page 6 ).
- ----------------------
(1) Incorporated by reference from Exhibit 10.02 to the Company's
Registration Statement on Form S-1 (File No. 33-91932) filed on May
5, 1995, and as subsequently amended.
(2) Retek Distribution Corporation is a British Virgin Islands
corporation that is an international business company formed under
the British Virgin Islands' International Business Companies Act,
and was acquired by the Registrant on November 29, 1996.
(3) Filed as Exhibit 3(i).04 (Restated Certificate of Incorporation) and
Exhibit 3(ii).05 (Bylaws) with the Company's Report on Form 10-Q for
the quarter ended June 30, 1996 as originally filed on August 13,
1996.
(4) Incorporated by reference from Exhibit 4.01 to the Company's
Registration Statement on Form S-1 (File No. 33-91932) filed on May
5, 1995, and as subsequently amended.
<PAGE> 1
EXHIBIT 4.01
HNC SOFTWARE INC.
1995 EQUITY INCENTIVE PLAN
As Adopted May 4, 1995
As Amended December 6, 1996
1. PURPOSE. The purpose of this Plan is to provide incentives to
attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent,
Subsidiaries and Affiliates, by offering them an opportunity to participate in
the Company's future performance through awards of Options, Restricted Stock and
Stock Bonuses. Capitalized terms not defined in the text are defined in Section
23.
2. SHARES SUBJECT TO THE PLAN.
2.1 Number of Shares Available. Subject to
Sections 2.2 and 18, the total number of Shares reserved and available for grant
and issuance pursuant to this Plan will be 2,800,000(1) Shares plus any Shares
that are made available for grant and issuance under this Plan pursuant to the
following sentence. Any Shares remaining unissued under the 1987 Stock Option
Plan adopted by HNC Software Inc., a California corporation that is the
Company's predecessor (the "PRIOR PLAN") on the Effective Date (as defined
below) and any Shares issuable upon exercise of options granted pursuant to the
Prior Plan that expire or become unexercisable for any reason without having
been exercised in full, will no longer be available for grant and issuance under
the Prior Plan, but will also be available for grant and issuance under this
Plan. Subject to Sections 2.2 and 18, Shares that: (a) are subject to issuance
upon exercise of an Option but cease to be subject to such Option for any reason
other than exercise of such Option; (b) are subject to an Award granted
hereunder but are forfeited or are repurchased by the Company at the original
issue price; or (c) are subject to an Award that otherwise terminates without
Shares being issued; will again be available for grant and issuance in
connection with future Awards under this Plan. At all times the Company shall
reserve and keep available a sufficient number of Shares as shall be required to
satisfy the requirements of all outstanding Options granted under this Plan and
all other outstanding but unvested Awards granted under this Plan.
2.2 Adjustment of Shares. In the event that the
number of outstanding Shares is changed by a stock dividend, recapitalization,
stock split, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of the Company without consideration,
then (a) the number of Shares reserved for issuance under this Plan, (b) the
Exercise Prices of and number of Shares subject to outstanding Options, and (c)
the number of Shares subject to other outstanding Awards will be proportionately
adjusted, subject to any required action by the Board or the stockholders of the
Company and compliance with applicable securities laws; provided, however, that
fractions of a Share will not be issued but will either be replaced by a cash
payment equal to the Fair Market Value of such fraction of a Share or will be
rounded up to the nearest whole Share, as determined by the Committee.
3. ELIGIBILITY. ISOs (as defined in Section 5 below) may be
granted only to employees (including officers and directors who are also
employees) of the Company or of a Parent or Subsidiary of the Company. All other
Awards may be granted to employees, officers, directors, consultants,
independent contractors and advisors of the Company or any Parent, Subsidiary or
Affiliate of the Company; provided such consultants, contractors and advisors
render bona fide services not in connection with the offer and sale of
securities in a capital-raising transaction. No person will be eligible to
receive more than 500,000(2) Shares in any calendar year under this Plan
pursuant to the grant of Awards hereunder, other than new employees of the
Company or of a Parent,
- -----------------
1 Adjusted to reflect (i) the 2-for-1 split of the Company's capital
stock effected in April 1996 and (ii) the authorization of 1,500,000
additional shares of Common Stock for issuance under the Plan approved
by the Company's stockholders on December 6, 1996.
2 Adjusted to reflect the 2-for-1 split of the Company's capital stock
effected in April 1996.
<PAGE> 2
HNC Software Inc.
1995 Equity Incentive Plan
Subsidiary or Affiliate of the Company (including new employees who are also
officers and directors of the Company or any Parent, Subsidiary or Affiliate of
the Company) who are eligible to receive up to a maximum of 700,000(3) Shares in
the calendar year in which they commence their employment. A person may be
granted more than one Award under this Plan.
4. ADMINISTRATION.
4.1 Committee Authority. This Plan will be
administered by the Committee or by the Board acting as the Committee. Subject
to the general purposes, terms and conditions of this Plan, and to the direction
of the Board, the Committee will have full power to implement and carry out this
Plan. Without limitation, the Committee will have the authority to:
(a) construe and interpret this Plan, any Award Agreement
and any other agreement or document executed pursuant
to this Plan;
(b) prescribe, amend and rescind rules and regulations
relating to this Plan;
(c) select persons to receive Awards;
(d) determine the form and terms of Awards;
(e) determine the number of Shares or other consideration
subject to Awards;
(f) determine whether Awards will be granted singly, in
combination with, in tandem with, in replacement of, or
as alternatives to, other Awards under this Plan or any
other incentive or compensation plan of the Company or
any Parent, Subsidiary or Affiliate of the Company;
(g) grant waivers of Plan or Award conditions;
(h) determine the vesting, exercisability and payment of
Awards;
(i) correct any defect, supply any omission or reconcile
any inconsistency in this Plan, any Award or any
Award Agreement;
(j) determine whether an Award has been earned; and
(k) make all other determinations necessary or advisable
for the administration of this Plan.
4.2 Committee Discretion. Any determination made
by the Committee with respect to any Award will be made in its sole discretion
at the time of grant of the Award or, unless in contravention of any express
term of this Plan or Award, at any later time, and such determination will be
final and binding on the Company and on all persons having an interest in any
Award under this Plan. The Committee may delegate to one or more officers of the
Company the authority to grant an Award under this Plan to Participants who are
not Insiders of the Company.
4.3 Exchange Act Requirements. If two or more
members of the Board are Outside Directors, the Committee will be comprised of
at least two (2) members of the Board, all of whom are Outside Directors and
Disinterested Persons. During all times that the Company is subject to Section
16 of the Exchange Act, the Company will take appropriate steps to comply with
the disinterested administration requirements of Section 16(b) of the Exchange
Act, which will consist of the appointment by the Board of a Committee
consisting of not less than two (2) members of the Board, each of whom is a
Disinterested Person.
- ----------------------
3 Adjusted to reflect the 2-for-1 split of the Company's capital stock
effected in April 1996.
-2-
<PAGE> 3
HNC Software Inc.
1995 Equity Incentive Plan
5. OPTIONS. The Committee may grant Options to eligible persons
and will determine whether such Options will be Incentive Stock Options within
the meaning of the Code ("ISOS") or Nonqualified Stock Options ("NQSOS"), the
number of Shares subject to the Option, the Exercise Price of the Option, the
period during which the Option may be exercised, and all other terms and
conditions of the Option, subject to the following:
5.1 Form of Option Grant. Each Option granted
under this Plan will be evidenced by an Award Agreement which will expressly
identify the Option as an ISO or an NQSO ("STOCK OPTION AGREEMENT"), and will be
in such form and contain such provisions (which need not be the same for each
Participant) as the Committee may from time to time approve, and which will
comply with and be subject to the terms and conditions of this Plan.
5.2 Date of Grant. The date of grant of an Option
will be the date on which the Committee makes the determination to grant such
Option, unless otherwise specified by the Committee. The Stock Option Agreement
and a copy of this Plan will be delivered to the Participant within a reasonable
time after the granting of the Option.
5.3 Exercise Period. Options will be exercisable
within the times or upon the events determined by the Committee as set forth in
the Stock Option Agreement governing such Option; provided, however, that no
Option will be exercisable after the expiration of ten (10) years from the date
the Option is granted; and provided further that no ISO granted to a person who
directly or by attribution owns more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or of any Parent or
Subsidiary of the Company ("TEN PERCENT STOCKHOLDER") will be exercisable after
the expiration of five (5) years from the date the ISO is granted. The Committee
also may provide for the exercise of Options to become exercisable at one time
or from time to time, periodically or otherwise, in such number of Shares or
percentage of Shares as the Committee determines.
5.4 Exercise Price. The Exercise Price of an
Option will be determined by the Committee when the Option is granted and may be
not less than 100% of the Fair Market Value of the Shares on the date of grant;
provided that the Exercise Price of any ISO granted to a Ten Percent Shareholder
will not be less than 110% of the Fair Market Value of the Shares on the date of
grant. Payment for the Shares purchased may be made in accordance with Section 8
of this Plan.
5.5 Method of Exercise. Options may be exercised
only by delivery to the Company of a written stock option exercise agreement
(the "EXERCISE AGREEMENT") in a form approved by the Committee (which need not
be the same for each Participant), stating the number of Shares being purchased,
the restrictions imposed on the Shares purchased under such Exercise Agreement,
if any, and such representations and agreements regarding Participant's
investment intent and access to information and other matters, if any, as may be
required or desirable by the Company to comply with applicable securities laws,
together with payment in full of the Exercise Price for the number of Shares
being purchased.
5.6 Termination. Notwithstanding the exercise
periods set forth in the Stock Option Agreement, exercise of an Option will
always be subject to the following:
(a) If the Participant is Terminated for any reason except
death or Disability, then the Participant may exercise
such Participant's Options only to the extent that such
Options would have been exercisable upon the
Termination Date no later than three (3) months after
the Termination Date (or such shorter or longer time
period not exceeding five (5) years as may be
determined by the Committee, with any exercise beyond
three (3) months after the Termination Date deemed to
be an NQSO), but in any event, no later than the
expiration date of the Options.
(b) If the Participant is Terminated because of
Participant's death or Disability (or the Participant
dies within three (3) months after a Termination
other than because of Participant's death or
disability), then Participant's Options may be
exercised only to the
-3-
<PAGE> 4
HNC Software Inc.
1995 Equity Incentive Plan
extent that such Options would have been exercisable
by Participant on the Termination Date and must be
exercised by Participant (or Participant's legal
representative or authorized assignee) no later than
twelve (12) months after the Termination Date (or
such shorter or longer time period not exceeding five
(5) years as may be determined by the Committee, with
any such exercise beyond (a) three (3) months after
the Termination Date when the Termination is for any
reason other than the Participant's death or
Disability, or (b) twelve (12) months after the
Termination Date when the Termination is for
Participant's death or Disability, deemed to be an
NQSO), but in any event no later than the expiration
date of the Options.
5.7 Limitations on Exercise. The Committee may
specify a reasonable minimum number of Shares that may be purchased on any
exercise of an Option, provided that such minimum number will not prevent
Participant from exercising the Option for the full number of Shares for which
it is then exercisable.
5.8 Limitations on ISOs. The aggregate Fair
Market Value (determined as of the date of grant) of Shares with respect to
which ISOs are exercisable for the first time by a Participant during any
calendar year (under this Plan or under any other incentive stock option plan of
the Company or any Affiliate, Parent or Subsidiary of the Company) will not
exceed $100,000. If the Fair Market Value of Shares on the date of grant with
respect to which ISOs are exercisable for the first time by a Participant during
any calendar year exceeds $100,000, then the Options for the first $100,000
worth of Shares to become exercisable in such calendar year will be ISOs and the
Options for the amount in excess of $100,000 that become exercisable in that
calendar year will be NQSOs. In the event that the Code or the regulations
promulgated thereunder are amended after the Effective Date of this Plan to
provide for a different limit on the Fair Market Value of Shares permitted to be
subject to ISOs, such different limit will be automatically incorporated herein
and will apply to any Options granted after the effective date of such
amendment.
5.9 Modification, Extension or Renewal. The
Committee may modify, extend or renew outstanding Options and authorize the
grant of new Options in substitution therefor, provided that any such action may
not, without the written consent of a Participant, impair any of such
Participant's rights under any Option previously granted. Any outstanding ISO
that is modified, extended, renewed or otherwise altered will be treated in
accordance with Section 424(h) of the Code. The Committee may reduce the
Exercise Price of outstanding Options without the consent of Participants
affected by a written notice to them; provided, however, that the Exercise Price
may not be reduced below the minimum Exercise Price that would be permitted
under Section 5.4 of this Plan for Options granted on the date the action is
taken to reduce the Exercise Price.
5.10 No Disqualification. Notwithstanding any
other provision in this Plan, no term of this Plan relating to ISOs will be
interpreted, amended or altered, nor will any discretion or authority granted
under this Plan be exercised, so as to disqualify this Plan under Section 422 of
the Code or, without the consent of the Participant affected, to disqualify any
ISO under Section 422 of the Code.
6. RESTRICTED STOCK. A Restricted Stock Award is an offer by the
Company to sell to an eligible person Shares that are subject to restrictions.
The Committee will determine to whom an offer will be made, the number of Shares
the person may purchase, the price to be paid (the "PURCHASE PRICE"), the
restrictions to which the Shares will be subject, and all other terms and
conditions of the Restricted Stock Award, subject to the following:
6.1 Form of Restricted Stock Award. All purchases
under a Restricted Stock Award made pursuant to this Plan will be evidenced by
an Award Agreement ("RESTRICTED STOCK PURCHASE AGREEMENT") that will be in such
form (which need not be the same for each Participant) as the Committee will
from time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The offer of Restricted Stock will be accepted by the
Participant's execution and delivery of the Restricted Stock Purchase Agreement
and full payment for the Shares to the Company within thirty (30) days from the
date the Restricted Stock Purchase Agreement is delivered to the person. If such
person does not execute and deliver the Restricted Stock Purchase Agreement
along with full payment for the Shares to the Company within thirty (30) days,
then the offer will terminate, unless otherwise determined by the Committee.
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6.2 Purchase Price. The Purchase Price of Shares
sold pursuant to a Restricted Stock Award will be determined by the Committee
and will be at least 100% of the Fair Market Value of the Shares on the date the
Restricted Stock Award is granted. Payment of the Purchase Price may be made in
accordance with Section 8 of this Plan.
6.3 Restrictions. Restricted Stock Awards will be
subject to such restrictions (if any) as the Committee may impose. The Committee
may provide for the lapse of such restrictions in installments and may
accelerate or waive such restrictions, in whole or part, based on length of
service, performance or such other factors or criteria as the Committee may
determine.
7. STOCK BONUSES.
7.1 Awards of Stock Bonuses. A Stock Bonus is an
award of Shares (which may consist of Restricted Stock) for services rendered to
the Company or any Parent, Subsidiary or Affiliate of the Company. A Stock Bonus
may be awarded for past services already rendered to the Company, or any Parent,
Subsidiary or Affiliate of the Company (provided that the Participant pays the
Company the par value of the Shares awarded by such Stock Bonus in cash)
pursuant to an Award Agreement (the "STOCK BONUS AGREEMENT") that will be in
such form (which need not be the same for each Participant) as the Committee
will from time to time approve, and will comply with and be subject to the terms
and conditions of this Plan. A Stock Bonus may be awarded upon satisfaction of
such performance goals as are set out in advance in the Participant's individual
Award Agreement (the "PERFORMANCE STOCK BONUS AGREEMENT") that will be in such
form (which need not be the same for each Participant) as the Committee will
from time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. Stock Bonuses may vary from Participant to Participant
and between groups of Participants, and may be based upon the achievement of the
Company, Parent, Subsidiary or Affiliate and/or individual performance factors
or upon such other criteria as the Committee may determine.
7.2 Terms of Stock Bonuses. The Committee will
determine the number of Shares to be awarded to the Participant and whether such
Shares will be Restricted Stock. If the Stock Bonus is being earned upon the
satisfaction of performance goals pursuant to a Performance Stock Bonus
Agreement, then the Committee will determine: (a) the nature, length and
starting date of any period during which performance is to be measured (the
"PERFORMANCE PERIOD") for each Stock Bonus; (b) the performance goals and
criteria to be used to measure the performance, if any; (c) the number of Shares
that may be awarded to the Participant; and (d) the extent to which such Stock
Bonuses have been earned. Performance Periods may overlap and Participants may
participate simultaneously with respect to Stock Bonuses that are subject to
different Performance Periods and different performance goals and other
criteria. The number of Shares may be fixed or may vary in accordance with such
performance goals and criteria as may be determined by the Committee. The
Committee may adjust the performance goals applicable to the Stock Bonuses to
take into account changes in law and accounting or tax rules and to make such
adjustments as the Committee deems necessary or appropriate to reflect the
impact of extraordinary or unusual items, events or circumstances to avoid
windfalls or hardships.
7.3 Form of Payment. The earned portion of a
Stock Bonus may be paid currently or on a deferred basis with such interest or
dividend equivalent, if any, as the Committee may determine. Payment may be made
in the form of cash, whole Shares, including Restricted Stock, or a combination
thereof, either in a lump sum payment or in installments, all as the Committee
will determine.
7.4 Termination During Performance Period. If a
Participant is Terminated during a Performance Period for any reason, then such
Participant will be entitled to payment (whether in Shares, cash or otherwise)
with respect to the Stock Bonus only to the extent earned as of the date of
Termination in accordance with the Performance Stock Bonus Agreement, unless the
Committee will determine otherwise.
8. PAYMENT FOR SHARE PURCHASES.
8.1 Payment. Payment for Shares purchased
pursuant to this Plan may be made in cash (by check) or, where expressly
approved for the Participant by the Committee and where permitted by law:
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(a) by cancellation of indebtedness of the Company to the
Participant;
(b) by surrender of shares that either: (1) have been owned
by Participant for more than six (6) months and have
been paid for within the meaning of SEC Rule 144 (and,
if such shares were purchased from the Company by use
of a promissory note, such note has been fully paid
with respect to such shares); or (2) were obtained by
Participant in the public market;
(c) by tender of a full recourse promissory note having
such terms as may be approved by the Committee and
bearing interest at a rate sufficient to avoid
imputation of income under Sections 483 and 1274 of the
Code; provided, however, that Participants who are not
employees or directors of the Company will not be
entitled to purchase Shares with a promissory note
unless the note is adequately secured by collateral
other than the Shares; provided, further, that the
portion of the Purchase Price equal to the par value of
the Shares, if any, must be paid in cash;
(d) by waiver of compensation due or accrued to the
Participant for services rendered; provided, further,
that the portion of the Purchase Price equal to the par
value of the Shares, if any, must be paid in cash;
(e) with respect only to purchases upon exercise of an
Option, and provided that a public market for the
Company's stock exists:
(1) through a "same day sale" commitment from the
Participant and a broker-dealer that is a
member of the National Association of
Securities Dealers (an "NASD DEALER") whereby
the Participant irrevocably elects to exercise
the Option and to sell a portion of the Shares
so purchased to pay for the Exercise Price,
and whereby the NASD Dealer irrevocably
commits upon receipt of such Shares to forward
the Exercise Price directly to the Company; or
(2) through a "margin" commitment from the
Participant and a NASD Dealer whereby the
Participant irrevocably elects to exercise the
Option and to pledge the Shares so purchased
to the NASD Dealer in a margin account as
security for a loan from the NASD Dealer in
the amount of the Exercise Price, and whereby
the NASD Dealer irrevocably commits upon
receipt of such Shares to forward the Exercise
Price directly to the Company; or
(f) by any combination of the foregoing.
8.2 Loan Guarantees. The Committee may help the
Participant pay for Shares purchased under this Plan by authorizing a guarantee
by the Company of a third-party loan to the Participant.
9. WITHHOLDING TAXES.
9.1 Withholding Generally. Whenever Shares are to
be issued in satisfaction of Awards granted under this Plan, the Company may
require the Participant to remit to the Company an amount sufficient to satisfy
federal, state and local withholding tax requirements prior to the delivery of
any certificate or certificates for such Shares. Whenever, under this Plan,
payments in satisfaction of Awards are to be made in cash, such payment will be
net of an amount sufficient to satisfy federal, state, and local withholding tax
requirements.
9.2 Stock Withholding. When, under applicable tax
laws, a Participant incurs tax liability in connection with the exercise or
vesting of any Award that is subject to tax withholding and the Participant is
obligated to pay the Company the amount required to be withheld, the Committee
may allow the Participant to satisfy the minimum withholding tax obligation by
electing to have the Company withhold from the
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1995 Equity Incentive Plan
Shares to be issued that number of Shares having a Fair Market Value equal to
the minimum amount required to be withheld, determined on the date that the
amount of tax to be withheld is to be determined (the "TAX DATE"). All elections
by a Participant to have Shares withheld for this purpose will be made in
writing in a form acceptable to the Committee and will be subject to the
following restrictions:
(a) the election must be made on or prior to the applicable
Tax Date;
(b) once made, then except as provided below, the election
will be irrevocable as to the particular Shares as to
which the election is made;
(c) all elections will be subject to the consent or
disapproval of the Committee;
(d) if the Participant is an Insider and if the Company is
subject to Section 16(b) of the Exchange Act: (1) the
election may not be made within six (6) months of the
date of grant of the Award, except as otherwise
permitted by SEC Rule 16b-3(e) under the Exchange
Act, and (2) either (A) the election to use stock
withholding must be irrevocably made at least six (6)
months prior to the Tax Date (although such election
may be revoked at any time at least six (6) months
prior to the Tax Date) or (B) the exercise of the
Option or election to use stock withholding must be
made in the ten (10) day period beginning on the
third day following the release of the Company's
quarterly or annual summary statement of sales or
earnings; and
(e) in the event that the Tax Date is deferred until six
(6) months after the delivery of Shares under Section
83(b) of the Code, the Participant will receive the
full number of Shares with respect to which the
exercise occurs, but such Participant will be
unconditionally obligated to tender back to the Company
the proper number of Shares on the Tax Date.
10. PRIVILEGES OF STOCK OWNERSHIP.
10.1 Voting and Dividends. No Participant will
have any of the rights of a stockholder with respect to any Shares until the
Shares are issued to the Participant. After Shares are issued to the
Participant, the Participant will be a stockholder and have all the rights of a
stockholder with respect to such Shares, including the right to vote and receive
all dividends or other distributions made or paid with respect to such Shares;
provided, that if such Shares are Restricted Stock, then any new, additional or
different securities the Participant may become entitled to receive with respect
to such Shares by virtue of a stock dividend, stock split or any other change in
the corporate or capital structure of the Company will be subject to the same
restrictions as the Restricted Stock; provided, further, that the Participant
will have no right to retain such stock dividends or stock distributions with
respect to Shares that are repurchased at the Participant's original Purchase
Price pursuant to Section 12.
10.2 Financial Statements. The Company will
provide financial statements to each Participant prior to such Participant's
purchase of Shares under this Plan, and to each Participant annually during the
period such Participant has Awards outstanding; provided, however, the Company
will not be required to provide such financial statements to Participants whose
services in connection with the Company assure them access to equivalent
information.
11. TRANSFERABILITY. Awards granted under this Plan, and any
interest therein, will not be transferable or assignable by Participant, and may
not be made subject to execution, attachment or similar process, otherwise than
by will or by the laws of descent and distribution or as consistent with the
specific Plan and Award Agreement provisions relating thereto. During the
lifetime of the Participant an Award will be exercisable only by the
Participant, and any elections with respect to an Award, may be made only by the
Participant.
12. RESTRICTIONS ON SHARES. At the discretion of the Committee,
the Company may reserve to itself and/or its assignee(s) in the Award Agreement
(a) a right of first refusal to purchase all Shares that a Participant (or a
subsequent transferee) may propose to transfer to a third party, and/or (b) a
right to repurchase a portion of or all Shares held by a Participant following
such Participant's Termination at any time within ninety (90)
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1995 Equity Incentive Plan
days after the later of Participant's Termination Date and the date Participant
purchases Shares under this Plan, for cash and/or cancellation of purchase money
indebtedness, at: (A) with respect to Shares that are "Vested" (as defined in
the Award Agreement), the higher of: (l) Participant's original Purchase Price,
or (2) the Fair Market Value of such Shares on Participant's Termination Date,
provided, that such right of repurchase (i) must be exercised as to all such
"Vested" Shares unless a Participant consents to the Company's repurchase of
only a portion of such "Vested" Shares and (ii) terminates when the Company's
securities become publicly traded; or (B) with respect to Shares that are not
"Vested" (as defined in the Award Agreement), at the Participant's original
Purchase Price, provided, that the right to repurchase at the original Purchase
Price lapses at the rate of at least 20% per year over five (5) years from the
date the Shares were purchased (or from the date of grant of options in the case
of Shares obtained pursuant to a Stock Option Agreement and Stock Option
Exercise Agreement), and if the right to repurchase is assignable, the assignee
must pay the Company, upon assignment of the right to repurchase, cash equal to
the excess of the Fair Market Value of the Shares over the original Purchase
Price.
13. CERTIFICATES. All certificates for Shares or other
securities delivered under this Plan will be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or foreign
securities law, or any rules, regulations and other requirements of the SEC or
any stock exchange or automated quotation system upon which the Shares may be
listed or quoted.
14. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve. The
Shares purchased with the promissory note may be released from the pledge on a
pro rata basis as the promissory note is paid.
15. EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any
time or from time to time, authorize the Company, with the consent of the
respective Participants, to issue new Awards in exchange for the surrender and
cancellation of any or all outstanding Awards. The Committee may at any time buy
from a Participant an Award previously granted with payment in cash, Shares
(including Restricted Stock) or other consideration, based on such terms and
conditions as the Committee and the Participant may agree.
16. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award
will not be effective unless such Award is in compliance with all applicable
federal and state securities laws, rules and regulations of any governmental
body, and the requirements of any stock exchange or automated quotation system
upon which the Shares may then be listed or quoted, as they are in effect on the
date of grant of the Award and also on the date of exercise or other issuance.
Notwithstanding any other provision in this Plan, the Company will have no
obligation to issue or deliver certificates for Shares under this Plan prior to:
(a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and/or (b) completion of any registration
or other qualification of such Shares under any state or federal law or ruling
of any governmental body that the Company determines to be necessary or
advisable. The Company will be under no obligation to register the Shares with
the SEC or to effect compliance with the registration, qualification or listing
requirements of any state securities laws, stock exchange or automated quotation
system, and the Company will have no liability for any inability or failure to
do so.
17. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award
granted under this Plan will confer or be deemed to confer on any Participant
any right to continue in the employ of, or to continue any
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1995 Equity Incentive Plan
other relationship with, the Company or any Parent, Subsidiary or Affiliate of
the Company or limit in any way the right of the Company or any Parent,
Subsidiary or Affiliate of the Company to terminate Participant's employment or
other relationship at any time, with or without cause.
18. CORPORATE TRANSACTIONS.
18.1 Assumption or Replacement of Awards by
Successor. In the event of (a) a dissolution or liquidation of the Company, (b)
a merger or consolidation in which the Company is not the surviving corporation
(other than a merger or consolidation with a wholly-owned subsidiary, a
reincorporation of the Company in a different jurisdiction, or other transaction
in which there is no substantial change in the stockholders of the Company or
their relative stock holdings and the Awards granted under this Plan are
assumed, converted or replaced by the successor corporation, which assumption
will be binding on all Participants), (c) a merger in which the Company is the
surviving corporation but after which the stockholders of the Company (other
than any stockholder which merges (or which owns or controls another corporation
which merges) with the Company in such merger) cease to own their shares or
other equity interests in the Company, (d) the sale of substantially all of the
assets of the Company, or (e) any other transaction which qualifies as a
"corporate transaction" under Section 424(a) of the Code wherein the
stockholders of the Company give up all of their equity interest in the Company
(except for the acquisition, sale or transfer of all or substantially all of the
outstanding shares of the Company from or by the stockholders of the Company),
any or all outstanding Awards may be assumed, converted or replaced by the
successor corporation (if any), which assumption, conversion or replacement will
be binding on all Participants. In the alternative, the successor corporation
may substitute equivalent Awards or provide substantially similar consideration
to Participants as was provided to stockholders (after taking into account the
existing provisions of the Awards). The successor corporation may also issue, in
place of outstanding Shares of the Company held by the Participant,
substantially similar shares or other property subject to repurchase
restrictions no less favorable to the Participant. In the event such successor
corporation (if any) refuses to assume or substitute Options, as provided above,
pursuant to a transaction described in this Subsection 18.1, such Options will
expire on such transaction at such time and on such conditions as the Board will
determine.
18.2 Other Treatment of Awards. Subject to any
greater rights granted to Participants under the foregoing provisions of this
Section 18, in the event of the occurrence of any transaction described in
Section 18.1, any outstanding Awards will be treated as provided in the
applicable agreement or plan of merger, consolidation, dissolution, liquidation,
sale of assets or other "corporate transaction."
18.3 Assumption of Awards by the Company. The
Company, from time to time, also may substitute or assume outstanding awards
granted by another company, whether in connection with an acquisition of such
other company or otherwise, by either; (a) granting an Award under this Plan in
substitution of such other company's award; or (b) assuming such award as if it
had been granted under this Plan if the terms of such assumed award could be
applied to an Award granted under this Plan. Such substitution or assumption
will be permissible if the holder of the substituted or assumed award would have
been eligible to be granted an Award under this Plan if the other company had
applied the rules of this Plan to such grant. In the event the Company assumes
an award granted by another company, the terms and conditions of such award will
remain unchanged (except that the exercise price and the number and nature of
Shares issuable upon exercise of any such option will be adjusted appropriately
pursuant to Section 424(a) of the Code). In the event the Company elects to
grant a new Option rather than assuming an existing option, such new Option may
be granted with a similarly adjusted Exercise Price.
19. ADOPTION AND STOCKHOLDER APPROVAL. This Plan will become
effective on the date on which the registration statement filed by the Company
with the SEC under the Securities Act registering the initial public offering of
the Company's Common Stock is declared effective by the SEC (the "EFFECTIVE
DATE"); provided, however, that if the Effective Date does not occur on or
before December 31, 1995, this Plan will terminate as of December 31, 1995
having never become effective. This Plan shall be approved by the stockholders
of the Company (excluding Shares issued pursuant to this Plan), consistent with
applicable laws, within twelve (12) months before or after the date this Plan is
adopted by the Board. Upon the Effective Date, the Board may grant Awards
pursuant to this Plan; provided, however, that: (a) no Option may be exercised
prior to initial stockholder approval of this Plan; (b) no Option granted
pursuant to an increase in the number of Shares subject to this Plan
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approved by the Board will be exercised prior to the time such increase has been
approved by the stockholders of the Company; and (c) in the event that
stockholder approval of such increase is not obtained within the time period
provided herein, all Awards granted hereunder will be canceled, any Shares
issued pursuant to any Award will be canceled, and any purchase of Shares
hereunder will be rescinded. So long as the Company is subject to Section 16(b)
of the Exchange Act, the Company will comply with the requirements of Rule 16b-3
(or its successor), as amended, with respect to stockholder approval.
20. TERM OF PLAN. Unless earlier terminated as provided
herein, this Plan will terminate ten (10) years from the date this Plan is
adopted by the Board or, if earlier, the date of stockholder approval.
21. AMENDMENT OR TERMINATION OF PLAN. The Board may at any time
terminate or amend this Plan in any respect, including without limitation
amendment of any form of Award Agreement or instrument to be executed pursuant
to this Plan; provided, however, that the Board will not, without the approval
of the stockholders of the Company, amend this Plan in any manner that requires
such stockholder approval pursuant to the Code or the regulations promulgated
thereunder as such provisions apply to ISO plans or (if the Company is subject
to the Exchange Act or Section 16(b) of the Exchange Act) pursuant to the
Exchange Act or Rule 16b-3 (or its successor), as amended, thereunder,
respectively.
22. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this
Plan by the Board, the submission of this Plan to the stockholders of the
Company for approval, nor any provision of this Plan will be construed as
creating any limitations on the power of the Board to adopt such additional
compensation arrangements as it may deem desirable, including, without
limitation, the granting of stock options and bonuses otherwise than under this
Plan, and such arrangements may be either generally applicable or applicable
only in specific cases.
23. DEFINITIONS. As used in this Plan, the following terms
will have the following meanings:
"AFFILIATE" means any corporation that directly, or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, another corporation, where "control" (including
the terms "controlled by" and "under common control with") means the possession,
direct or indirect, of the power to cause the direction of the management and
policies of the corporation, whether through the ownership of voting securities,
by contract or otherwise.
"AWARD" means any award under this Plan, including any
Option, Restricted Stock or Stock Bonus.
"AWARD AGREEMENT" means, with respect to each Award,
the signed written agreement between the Company and the Participant setting
forth the terms and conditions of the Award.
"BOARD" means the Board of Directors of the Company.
"CODE" means the Internal Revenue Code of 1986, as
amended.
"COMMITTEE" means the committee appointed by the Board
to administer this Plan, or if no such committee is appointed, the Board.
"COMPANY" means HNC Software Inc., a corporation
organized under the laws of the State of Delaware, or any successor corporation.
"DISABILITY" means a disability, whether temporary or
permanent, partial or total, within the meaning of Section 22(e)(3) of the Code,
as determined by the Committee.
"DISINTERESTED PERSON" means a director who has not,
during the period that person is a member of the Committee and for one year
prior to commencing service as a member of the Committee, been granted or
awarded equity securities pursuant to this Plan or any other plan of the Company
or any Parent,
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Subsidiary or Affiliate of the Company, except in accordance with
the requirements set forth in Rule 16b-3(c)(2)(i) (and any successor regulation
thereto) as promulgated by the SEC under Section 16(b) of the Exchange Act, as
such rule is amended from time to time and as interpreted by the SEC.
"EXCHANGE ACT" means the Securities Exchange Act of
1934, as amended.
"EXERCISE PRICE" means the price at which a holder of
an Option may purchase the Shares issuable upon exercise of the Option.
"FAIR MARKET VALUE" means, as of any date, the value of
a share of the Company's Common Stock determined as follows:
(a) if such Common Stock is then quoted on the Nasdaq
National Market, its closing price on the Nasdaq
National Market on the last trading day prior to the
date of determination as reported in The Wall Street
Journal;
(b) if such Common Stock is publicly traded and is then
listed on a national securities exchange, its closing
price on the last trading day prior to the date of
determination on the principal national securities
exchange on which the Common Stock is listed or
admitted to trading as reported in The Wall Street
Journal;
(c) if such Common Stock is publicly traded but is not
quoted on the Nasdaq National Market nor listed or
admitted to trading on a national securities exchange,
the average of the closing bid and asked prices on the
last trading day prior to the date of determination as
reported in The Wall Street Journal; or
(d) if none of the foregoing is applicable, by the
Committee in good faith.
"INSIDER" means an officer or director of the Company
or any other person whose transactions in the Company's Common Stock are subject
to Section 16 of the Exchange Act.
"OUTSIDE DIRECTOR" means any director who is not; (a) a
current employee of the Company or any Parent, Subsidiary or Affiliate of the
Company; (b) a former employee of the Company or any Parent, Subsidiary or
Affiliate of the Company who is receiving compensation for prior services (other
than benefits under a tax-qualified pension plan); (c) a current or former
officer of the Company or any Parent, Subsidiary or Affiliate of the Company; or
(d) currently receiving compensation for personal services in any capacity,
other than as a director, from the Company or any Parent, Subsidiary or
Affiliate of the Company; provided, however, that at such time as the term
"Outside Director", as used in Section 162(m) of the Code is defined in
regulations promulgated under Section 162(m) of the Code, "Outside Director"
will have the meaning set forth in such regulations, as amended from time to
time and as interpreted by the Internal Revenue Service.
"OPTION" means an award of an option to purchase Shares
pursuant to Section 5.
"PARENT" means any corporation (other than the Company)
in an unbroken chain of corporations ending with the Company, if at the time of
the granting of an Award under this Plan, each of such corporations other than
the Company owns stock possessing 50% or more of the total combined voting power
of all classes of stock in one of the other corporations in such chain.
"PARTICIPANT" means a person who receives an Award
under this Plan.
"PLAN" means this HNC Software Inc. 1995 Equity
Incentive Plan, as amended from time to time.
"RESTRICTED STOCK AWARD" means an award of Shares
pursuant to Section 6.
-11-
<PAGE> 12
HNC Software Inc.
1995 Equity Incentive Plan
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as
amended.
"SHARES" means shares of the Company's Common Stock
reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and
18, and any successor security.
"STOCK BONUS" means an award of Shares, or cash in lieu
of Shares, pursuant to Section 7.
"SUBSIDIARY" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company if, at
the time of granting of the Award, each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50% or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.
"TERMINATION" or "TERMINATED" means, for purposes of
this Plan with respect to a Participant, that the Participant has for any reason
ceased to provide services as an employee, director, consultant, independent
contractor or advisor to the Company or a Parent, Subsidiary or Affiliate of the
Company, except in the case of sick leave, military leave, or any other leave of
absence approved by the Committee, provided that such leave is for a period of
not more than ninety (90) days, or reinstatement upon the expiration of such
leave is guaranteed by contract or statute. The Committee will have sole
discretion to determine whether a Participant has ceased to provide services and
the effective date on which the Participant ceased to provide services (the
"TERMINATION DATE").
-12-
<PAGE> 1
EXHIBIT 4.03
STOCK OPTION AGREEMENT
BETWEEN:
RETEK DISTRIBUTION CORPORATION
- AND -
The Employee
<PAGE> 2
- i -
TABLE OF CONTENTS
1. PARTIES.............................................................. 1
2. DEFINITIONS.......................................................... 1
3. GRANT OF OPTION...................................................... 1
4. VESTING : EXERCISE PERIOD............................................ 1
4.1 VESTING OF RIGHT TO EXERCISE OPTION............................ 1
4.2 EXPIRATION PERIOD.............................................. 1
5. TERMINATION.......................................................... 1
5.1 TERMINATION FOR ANY REASON..................................... 1
5.2 NO OBLIGATION TO EMPLOY........................................ 2
6. MANNER AND CONDITIONS OF EXERCISE.................................... 2
7. ADJUSTMENT OF SHARES................................................. 3
8. COMPLIANCE WITH LAWS AND REGULATIONS................................. 3
9. NON-TRANSFERABILITY OF OPTION........................................ 3
10. PRIVILEGES OF STOCK OWNERSHIP........................................ 3
11. BOARD POWERS......................................................... 3
12. TAX CONSEQUENCES..................................................... 3
13. CERTAIN CORPORATE TRANSACTIONS....................................... 3
14. FURTHER ASSURANCES................................................... 4
15. ENTIRE AGREEMENT..................................................... 4
16. NOTICES.............................................................. 4
17. SUCCESSORS AND ASSIGNS............................................... 4
18. GOVERNING LAW........................................................ 4
<PAGE> 3
RETEK DISTRIBUTION CORPORATION
STOCK OPTION AGREEMENT
1. PARTIES
This Stock Option Agreement (this "Agreement") between RETEK DISTRIBUTION
CORPORATION, a company incorporated in the British Virgin Islands (the
"Company") and the Employee named below (the "Employee") IS ENTERED INTO TO
CONFIRM THE GRANT OF STOCK OPTIONS AND THE TERMS AND CONDITIONS THEREOF,
EFFECTIVE AS AT THE DATE OF GRANT (AS HEREINAFTER DEFINED), ORIGINALLY GRANTED
TO THE EMPLOYEE IN THE EMPLOYMENT AGREEMENT (AS HEREINAFTER DEFINED).
2. DEFINITIONS
The following terms, when used in this Agreement, shall have the following
meanings:
(a) EMPLOYEE: ______________________________________________
(b) SOCIAL SECURITY NUMBER: ______________________________________________
(c) EMPLOYEE'S ADDRESS: ______________________________________________
(d) TOTAL OPTION SHARES: ______________________________________________
(e) EXERCISE PRICE PER SHARE: ______________________________________________
(f) DATE OF GRANT: ______________________________________________
(g) VESTING START DATE: ______________________________________________
(h) EXPIRATION DATE: ______________________________________________
(i) EMPLOYMENT AGREEMENT: MEANS THE AGREEMENT ENTERED INTO BETWEEN THE
EMPLOYEE AND_______ DATED________.
3. GRANT OF OPTION
The Company hereby CONFIRMS THE GRANT MADE to the Employee OF an option (this
"Option") AS ORIGINALLY EVIDENCED IN THE EMPLOYMENT AGREEMENT, AND AS MORE
PARTICULARLY SET FORTH IN THIS AGREEMENT, to purchase up to the total number of
shares of common shares of the Company set forth above (collectively the
"Shares") at the Exercise Price Per Share set forth above (the "Exercise
Price"), subject to all of the terms and conditions of this Agreement.
4. VESTING: EXERCISE PERIOD
4.1 VESTING OF RIGHT TO EXERCISE OPTION. This Option shall become exercisable
as to portions of the Shares as follows:
(a) this Option shall not be exercisable with respect to any of the Shares
until_______ (the "First Vesting Date");
(b) if the Employee has continuously provided service to the Company or any
subsidiary (the "Subsidiary") of the Company as described in Schedule "A"
hereto from the Date of Grant through the First Vesting Date and has not
been Terminated on or before the First Vesting Date, then on the First
Vesting Date, this Option shall become exercisable as to ____________
_________(___%) percent of the Shares; and
(c) thereafter, so long as the Employee continuously provides service to the
Company or any Subsidiary and is not Terminated, on each successive
anniversary of the First Vesting Date thereafter, this Option shall become
exercisable as to an additional ___________ (___ %) percent of the Shares;
provided that this Option shall, in no event, become exercisable with
respect to more than One Hundred (100%) percent of the Shares.
4.2 EXPIRATION PERIOD. This Option shall expire on the Expiration Date set
forth above and must be exercised, if at all, on or before the earlier of the
Expiration Date or the date on which this Option is earlier terminated in
accordance with the provisions of Section 6.
5. TERMINATION
5.1 TERMINATION FOR ANY REASON. If the employment of the Employee with the
Company or any Subsidiary is Terminated for any reason (including the death
or Disability of the Employee), then:
(a) if the Employee is Terminated for any reason, except the Employee's death
or Disability of the Employee, then this Option, to the extent that it is
exercisable by the Employee on the date of Termination, may be exercised
by Employee (or Employee's legal representative) no later than three (3)
months after the date of Termination, but in any event no later than the
Expiration Date; or
(b) if the Employee is Terminated because of the death of the Employee,
then this Option, to the extent (and only to the extent) that it is
exercisable by the Employee on the date of Termination, may be
exercised by the Employee's legal representative no later than twelve
(12) months after the date of Termination but, in any event, no later
than the Expiration Date. The term "Disability" when used in this
Agreement means that the Employee's mental or physical health has
deteriorated to the extent such that in the opinion of the Board of
Directors of the Company, Employee is unable to perform his duties to
the Company in an acceptable manner. The Company shall have sole
discretion to determine if an Employee has suffered a Disability.
The term "Terminated" when used in this Agreement means the Employee has ceased
to provide services as an employee, director, consultant, independent contractor
or advisor, to the Company or a Subsidiary, except in the case of sick leave or
other leave of absence approved by the Company, provided that such leave is for
a period of not more than ninety (90) days. The Company shall have sole
discretion to determine whether an Employee has ceased to provide
<PAGE> 4
- 2 -
services and the effective date on which the Employee ceased to provide
services.
5.2 NO OBLIGATION TO EMPLOY. Nothing in this Agreement shall confer on the
Employee any right to continue in the employ of, or other relationship with, the
Company or any Subsidiary, or limit in any way the right of the Company or any
Subsidiary to terminate the Employee's employment or other relationship at any
time, with or without cause.
6. MANNER AND CONDITIONS OF EXERCISE
Following are the terms and conditions of the Employee's right to exercise the
Options:
(a) To exercise this Option, the Employee (or in the case of exercise after
the Employee's death, the Employee's executor, administrator, heir or
legatee, as the case may be) must deliver to the Company, an executed
Stock Option Exercise Agreement in the form prescribed by the Company or,
if no such form is prescribed then an executed, written notice exercising
the Option (the "EXERCISE AGREEMENT"), which shall set forth, inter alia,
the Employee's election to exercise the Option, the number of Shares being
purchased, any restrictions imposed on the Shares and any representations,
warranties and agreements regarding the Employee's investment intent and
access to information as may be required by the Company to comply with
applicable securities laws. If someone other than the Employee exercises
the Option, then such person must submit documentation reasonably
acceptable to the Company that such person has the right to exercise the
Option.
(b) The Option may only be exercised by the Employee: (i) unconditionally;
(ii) by delivery of the Exercise Agreement to the Company within the time
period set forth in this Agreement; and (iii) by payment to the Company of
the Exercise Price for the Shares concurrent with delivery of the Exercise
Agreement. The Option may only be exercised by the Employee as to more
than one hundred (100) Shares unless it is exercised as to all Shares to
which the Option is then exercisable.
(c) Payment of the Exercise Price shall be in cash OR cheque, acceptable to
the Company, or where permitted by law:
(i) by cancellation of indebtedness of the Company to the Employee;
(ii) by waiver of compensation due or accrued to the Employee for
services rendered;
(iii) provided that a public market with the Company's stock exists
through a "same-day sale" commitment from the Employer and a broker
dealer acceptable to the Company (the "Stock Broker") whereby the
Employee irrevocably elects to exercise the Option and to sell a
portion of the Shares so purchased to pay for the Exercise Price and
whereby the Stock Broker irrevocably commits, upon receipt of such
Shares, to forward the Exercise Price directly to the Company.
(d) This Option may not be exercised unless such exercise is in compliance
with all applicable securities laws as they are in effect on the date of
exercise.
(e) Prior to issuance of the Shares, upon exercise of this Option, the
Employee shall pay to the Company or directly to the relevant taxing
authorities, any applicable withholding obligations of the Company in
relation to the exercise of the Option and issuance of the Shares
resulting therefrom.
(f) Provided the Employee complies with the terms of this Agreement, including
payment of the Exercise Price in a form and substance satisfactory to the
Company and payment of any applicable withholding obligations of the
Company, the Company shall issue the Shares registered in the name of the
Employee and shall deliver share certificates representing the Shares with
the appropriate legends affixed thereto.
7. ADJUSTMENT OF SHARES
In the event that the number of outstanding shares of the capital stock of the
Company is changed by a stock dividend, recapitalization, stock split, reverse
stock split, subdivision, combination, reclassification or similar change in the
capital structure of the Company without consideration, then the number of
Shares issuable upon exercise of the Option and the Exercise Price shall be
proportionately adjusted, subject to any required action by the Board of
Directors of the Company or the Shareholders of the Company in compliance with
applicable securities law; provided however, that fractions of a Share shall not
be issued but shall either be paid in cash, at fair market value, or shall be
rounded up to the nearest share, as determined by the Company.
8. COMPLIANCE WITH LAWS AND REGULATIONS
The exercise of this Option and the issuance and transfer of Shares shall be
subject to compliance by the Company and the Employee with all applicable
requirements of securities laws affecting the Employee or the Company or any
successor company as a result of any Corporate Transaction (as hereinafter
defined), with all applicable requirements of said laws and with all applicable
requirements of any stock exchange on which the Shares may be listed at the time
of such issuance or transfer. The Employee understands that the Company is under
no obligation to register or qualify the Shares with any regulatory authority,
to effect such compliance. Accordingly, the Shares issued upon the exercise of
this Option may be subject to restrictions on transferability and resale
pursuant to applicable securities law. The Employee is aware that he/she may be
required to bear the financial risk of holding the Shares for an indefinite
period of time. All certificates for Shares or other securities delivered
pursuant to this Agreement shall be subject to such stock transfer orders,
legends and other restrictions as the Company may deem necessary or advisable,
including restrictions under any applicable securities law, or any rules,
regulations and other requirements of any stock exchange or applicable
regulatory authority.
<PAGE> 5
- 3 -
9. NON-TRANSFERABILITY OF OPTION
This Option may not be transferred in any manner other than by Will or by the
laws of descent and distribution and may be exercised during the lifetime of
Employee only by Employee. The terms of this Option shall be binding upon the
executors, administrators, successors and permitted assigns of Employee.
10. PRIVILEGES OF STOCK OWNERSHIP
The Employee shall not have any rights of a shareholder with respect to any
Shares until the Employee exercises this Option, pays the Exercise Price and has
been issued the Shares by the Company.
11. BOARD POWERS
11.1 Any dispute regarding the interpretation of this Agreement shall be
submitted by the Employee or the Company to the Board of Directors of the
Company for review. The resolution of such a dispute by the Board of Directors
shall be final and binding on the Company and the Employee.
11.2 The Board of Directors of the Company may modify, extend or renew the
Option and authorize the grant of a new Option(s) in substitution therefor,
provided that any such action may not, without the written consent of the
Employee, impair any of the Employee's rights under this Agreement. The Board of
Directors of the Company may reduce the Exercise Price without the consent of
the Employee.
12. TAX CONSEQUENCES
The Employee understands and acknowledges that this Option is a non-qualified
stock option for U.S. income tax purposes. The Employee understands that the
Employee may suffer adverse tax consequences as a result of exercising all or
any portion of this Option and acquiring or disposing of all or any portion of
the Shares, including without limitation but by way of example. Employee may be
treated as having received compensable income (taxable at applicable ordinary
income tax rates) equal to the excess (if any) of the fair market value of the
Shares on the day of exercise over the Exercise Price. The Employee represents
that the Employee has consulted with such tax advisors as the Employee deems
advisable in connection with the entering into of this Option and the Employee
shall further consult with such tax advisors as the Employee deems advisable in
connection with the exercise, purchase or disposition of any of the Shares and
that the Employee is not relying on the Company for any tax advice.
13. CERTAIN CORPORATE TRANSACTIONS
In the event of: (i) a merger or consolidation in which the Company is not the
surviving Corporation (other than a merge or consolidation with a wholly-owned
subsidiary, a reincorporation of the Company in a different jurisdiction or
other transactions in which there is no substantial change in the Shareholders
of the Company); (ii) sale or exchange of 90% or more of the issued and
outstanding shares in the capital of the Company to a single purchaser; or (iii)
the sale of substantially all of the assets of the Company (each a "Corporate
Transaction"), this Option may be assumed by the successor corporation (if any),
which assumption shall be binding on the Employee. In the alternative, the
successor corporation may substitute an equivalent option or provide
substantially similar consideration to the Employee, as provided in the
applicable definitive agreement executed by the Company and such successor
corporation in connection with such Corporate Transaction.
14. FURTHER ASSURANCES
The Employee shall, immediately upon demand by the Company, execute such
necessary consents, waivers and agreements as may be required by the Company to
complete any Corporate Transaction, including, without limitation, documents to
amend this Agreement and this Option. The Employee agrees to promptly execute
such waivers or other documents or agreements to permit the Company to issue
further common shares to present or potential employees or other third parties
contributing to the well-being of the Company and for purposes of any Corporate
Transaction in such amounts and at such times as the Company may determine, in
its absolute discretion.
15. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement and understanding of the parties
hereto with respect to the subject matter hereof and supersedes all prior
understandings and agreements with respect to such subject matter and, without
limiting the generality of the foregoing, by way of example, the Employee
acknowledges that this Agreement satisfies in full all obligations of the
Company set forth in any prior inducement or offer of employment, employment
agreement by the Company, a Subsidiary or by any officer, director or employee
thereof, including (but not limited to) THE EMPLOYMENT AGREEMENT.
16. NOTICES
Any notice required to be given or delivered to the Company under the terms of
this Agreement shall be in writing and addressed to the Corporate Secretary of
the Company at its principal corporate offices. Any notice required to be given
or delivered to the Employee shall be in writing and addressed to the Employee
at the address indicated above or to such other address as such party may
designate in writing, from time to time. All notices shall be deemed to have
been given or delivered upon: (i) personal delivery; (ii) two (2) business days
after deposit with any return receipt express courier (prepaid); or (iii) one
(1) business day after transmission by telecopier.
<PAGE> 6
- 4 -
17. SUCCESSORS AND ASSIGNS
The Company may assign any of its rights under this Agreement. This Agreement
shall be binding upon and enure to the benefit of the successors and assigns of
the Company. Subject to the restrictions on transfers set forth herein, this
Agreement shall be binding upon the Employee and the Employee's heirs,
executors, administrators, legal representatives, permitted successors and
assigns.
18. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the law of
the BRITISH VIRGIN ISLANDS.
IN WITNESS WHEREOF the Company has caused this Agreement to be executed,
in duplicate, by its duly authorized representative and the Employee has
executed this Agreement, in triplicate, as of the Date of Grant.
RETEK DISTRIBUTION CORPORATION by ) THE EMPLOYEE
its Authorized Signatory )
)
)
)
- ----------------------------------- )
Authorized Signatory ) -----------------------------------
Name (Printed): ) Signature
Title: ) Name (Printed):
<PAGE> 7
SCHEDULE "A"
The Companies below listed are for purposes of the Retek Distribution
Corporation Stock Option Agreement, each a Subsidiary of Retek
Distribution Corporation:
RETEK INFORMATION SYSTEMS INC. (Canada)
RETEK INFORMATION SYSTEMS, INC. (USA)
RETEK INFORMATION SYSTEMS PTY.LTD. (Australia)
RETEK INFORMATION SYSTEMS LTD. (UK)
<PAGE> 1
EXHIBIT 5.01
December 27, 1996
HNC Software Inc.
5930 Cornerstone Court West
San Diego, California 92121-3728
Ladies & Gentlemen:
At your request, we have examined the Registration Statement on Form
S-8 (the "Registration Statement") to be filed by you with the Securities and
Exchange Commission on or about December 27, 1996 in connection with the
registration under the Securities Act of 1933, as amended, of (i) an aggregate
of 1,750,000 additional shares of the Common Stock (the "Common Stock") of HNC
Software Inc. ("HNC") subject to issuance by HNC pursuant to the HNC Software
Inc. 1995 Equity Incentive Plan, as amended through December 6, 1996 (the
"Plan"), and (ii) 155,864 shares of the Common Stock which are issuable upon the
exercise of options originally granted by Retek Distribution Corporation
("Retek") that have been assumed by HNC and converted into options to purchase
Common Stock (the "Assumed Options") pursuant to the Exchange Agreement dated as
of October 25, 1996 (the "Exchange Agreement") between HNC Software Inc. ("HNC")
and the shareholders of Retek and the Option Exchange Agreements entered into in
connection therewith between HNC and the holders of outstanding options to
purchase shares of Retek (the "Option Exchange Agreements").
In rendering this opinion, we have examined the following:
(1) the Registration Statement, together with the Exhibits filed
as a part thereof, including, without limitation the Plan, the
Assumed Options and related documents;
(2) the Prospectus prepared in connection with the Plan and with
the Registration Statement;
(3) the Prospectus prepared in connection with the Assumed Options
and with the Registration Statement;
(4) the minutes of meetings and actions by written consent of the
stockholders and Board of Directors of HNC relating to the
Plan that you have provided to us;
(5) the minutes of meetings and actions by written consent of the
stockholders and Board of Directors of HNC relating to the
Exchange Agreement, the Option Exchange Agreements and the
assumption by HNC of the Assumed Options, the Exchange
Agreement and the Option Exchange Agreements; and
(6) the Certificate of Incorporation of HNC, as amended and
restated through June 13, 1996 and the Bylaws of HNC, both as
filed by HNC with its Report on Form 10-Q for the quarter
ended June 30, 1996.
<PAGE> 2
In our examination of documents for purposes of this opinion, we have
assumed, and express no opinion as to, the genuineness of all signatures on
original documents, the authenticity of all documents submitted to us as
originals, the conformity to originals of all documents submitted to us as
copies, the lack of any undisclosed terminations, modifications, waivers or
amendments to any documents reviewed by us and the due execution and delivery of
all documents where due execution and delivery are prerequisites to the
effectiveness thereof.
As to matters of fact relevant to this opinion, we have relied solely
upon our examination of the documents referred to above and have assumed the
current accuracy and completeness of the information and records included in the
documents referred to above. We have made no independent investigations or other
attempts to verify the accuracy of any of such information or to determine the
existence or non-existence of any other factual matters; however, we are not
aware of any facts that would lead us to believe that the opinion expressed
herein is not accurate. Our opinion below is given on the assumption that
shares of Common Stock may not be issued and sold by HNC in accordance with the
Plan unless and until such shares, at the time in question, are (i) explicitly
reserved and available for issuance under the Plan or (ii) become issuable
under the Plan in the future by virtue of the terms of Section 2.1 of the Plan,
which provide that certain shares issuable upon exercise of options granted
under the Prior Plan (as that term is defined in the Plan) that expire or
become unexercisable without having been exercised are available for grant and
issuance under the Plan.
Based upon the foregoing, it is our opinion that:
1. The 1,750,000 additional shares of Common Stock that may be issued
and sold by you pursuant to the Plan, when issued and sold in accordance with
the Plan and in the manner referred to in the Prospectus associated with the
Plan and the Registration Statement, and, in the case of shares of Common Stock
issuable upon exercise of stock options, the stock options issued thereunder,
will be legally issued, fully paid and nonassessable.
2. The 155,864 shares of Common Stock that may be issued and sold by
you pursuant to exercise of the Assumed Options, when issued and sold in the
manner referred to in the Prospectus associated with the Registration Statement
and in accordance with Retek's Nonqualified Stock Option Agreements pursuant to
which the Assumed Options were granted, will be legally issued, fully paid and
nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to all references to us, if any, in the
Registration Statement, the Prospectus constituting a part thereof and any
amendments thereto.
This opinion speaks only as of its date and is intended solely for the
your use as an exhibit to the Registration Statement for the purpose of the
above sale of the Common Stock and is not to be relied upon for any other
purpose.
Very truly yours,
FENWICK & WEST LLP
By:_______________________________
<PAGE> 1
EXHIBIT 23.02
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 30, 1996, which appears on
page 34 of the 1995 Annual Report to Stockholders of HNC Software Inc., which is
incorporated by reference in HNC Software Inc.'s Annual Report on Form 10-K for
the year ended December 31, 1995. We also consent to the incorporation by
reference of our report on the Financial Statement Schedule, which appears on
page 29 of such Annual Report on Form 10-K. We also consent to the incorporation
by reference in this Registration Statement on Form S-8 of our report dated
January 30, 1996, except as to the stock split which is as of April 3, 1996 and
as to the pooling of interests with Risk Data Corporation which is as of August
30, 1996 and as to the repayment of all of Risk Data Corporation's outstanding
debt which is as of September 11, 1996 and as to the pooling of interests with
Retek Distribution Corporation which is as of November 29, 1996 and as to the
increase in the number of shares reserved for issuance under the 1995 Equity
Incentive Plan which is as of December 6, 1996, appearing on page 3 of HNC
Software Inc.'s Current Report on Form 8-K dated December 19, 1996. We also
consent to the incorporation by reference of our report on the Financial
Statement Schedule, which appears on page 20 of such Current Report on Form 8-K.
PRICE WATERHOUSE LLP
San Diego, California
December 26, 1996
