-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TsJFDzY1+kWsAQDeJOziYkmJhkNyS6KONIF6mOSXyoLFaKhwpryG+O2/LMb+viYy M7sYQhOA4zyqh78LMSVCgA== 0000936392-96-001240.txt : 19961231 0000936392-96-001240.hdr.sgml : 19961231 ACCESSION NUMBER: 0000936392-96-001240 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19961227 EFFECTIVENESS DATE: 19961227 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HNC SOFTWARE INC/DE CENTRAL INDEX KEY: 0000945093 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 330248788 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-18871 FILM NUMBER: 96686891 BUSINESS ADDRESS: STREET 1: 5930 CORNERSTONE CT WEST CITY: SAN DIEGO STATE: CA ZIP: 92121-3728 BUSINESS PHONE: 6195468877 MAIL ADDRESS: STREET 1: 5930 CORNERSTONE CT WEST CITY: SAN DIEGO STATE: CA ZIP: 92121-3728 S-8 1 FORM S-8 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
=============================================================================================================================== 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 - ------------------------------------------------------------------------------------------------------------------------------- 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) ===============================================================================================================================
(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). 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 -PAGE 2- 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. -PAGE 3- 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 -PAGE 4- 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. -PAGE 5- 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.
SIGNATURE TITLE DATE --------- ----- ---- 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.
-PAGE 6- 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. EX-4.01 2 EXHIBIT 4.01 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. 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- 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- 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. -4- 5 HNC Software Inc. 1995 Equity Incentive Plan 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: -5- 6 HNC Software Inc. 1995 Equity Incentive Plan (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 -6- 7 HNC Software Inc. 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) -7- 8 HNC Software Inc. 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 -8- 9 HNC Software Inc. 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 -9- 10 HNC Software Inc. 1995 Equity Incentive Plan 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, -10- 11 HNC Software Inc. 1995 Equity Incentive Plan 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- 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- EX-4.03 3 EXHIBIT 4.03 1 EXHIBIT 4.03 STOCK OPTION AGREEMENT BETWEEN: RETEK DISTRIBUTION CORPORATION - AND - The Employee 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 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 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. 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. 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): 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) EX-5.01 4 EXHIBIT 5.01 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. 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:_______________________________ EX-23.02 5 EXHIBIT 23.02 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 -----END PRIVACY-ENHANCED MESSAGE-----