EXHIBIT 10.2




FORM OF STOCK OPTION AGREEMENT

CHORDIANT SOFTWARE, INC.




2005 EQUITY INCENTIVE PLAN



STOCK OPTION AGREEMENT

(INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)




Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, Chordiant Software, Inc. (the "Company") has granted you an
option under its 2005 Equity Incentive Plan (the "Plan") to purchase the number
of shares of the Company's Common Stock indicated in your Grant Notice at the
exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.




The details of your option are as follows:




12. VESTING. Subject to the limitations contained herein, your option will vest
as provided in your Grant Notice, provided that vesting will cease upon the
termination of your Continuous Service.




13. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common Stock
subject to your option and your exercise price per share referenced in your
Grant Notice may be adjusted from time to time for Capitalization Adjustments.




14. METHOD OF PAYMENT. Payment of the exercise price is due in full upon
exercise of all or any part of your option. You may elect to make payment of the
exercise price in cash or by check or in any other manner permitted by your
Grant Notice, which may include one or more of the following:

(a) In the Company's sole discretion at the time your option is exercised and
provided that at the time of exercise the Common Stock is publicly traded and
quoted regularly in The Wall Street Journal, pursuant to a program developed
under Regulation T as promulgated by the Federal Reserve Board that, prior to
the issuance of Common Stock, results in either the receipt of cash (or check)
by the Company or the receipt of irrevocable instructions to pay the aggregate
exercise price to the Company from the sales proceeds.

(b) Provided that at the time of exercise the Common Stock is publicly traded
and quoted regularly in The Wall Street Journal, by delivery of already-owned
shares of Common Stock either that you have held for the period required to
avoid a charge to the Company's reported earnings (generally six (6) months) or
that you did not acquire, directly or indirectly from the Company, that are
owned free and clear of any liens, claims, encumbrances or security interests,
and that are valued at Fair Market Value on the date of exercise. "Delivery" for
these purposes, in the sole discretion of the Company at the time you exercise
your option, shall include delivery to the Company of your attestation of
ownership of such shares of Common Stock in a form approved by the Company.
Notwithstanding the foregoing, you may not exercise your option by tender to the
Company of Common Stock to the extent such tender would violate the provisions
of any law, regulation or agreement restricting the redemption of the Company's
stock.

(c) Provided that at the time of exercise the Company has adopted FAS 123, as
revised, and has established a procedure for such exercise, by a "net exercise"
arrangement pursuant to which the Company will reduce the number of shares of
Common Stock issued upon exercise of your option by the largest whole number of
shares with a Fair Market Value that does not exceed the aggregate exercise
price; provided, however, the Company shall accept a cash or other payment from
you to the extent of any remaining balance of the aggregate exercise price not
satisfied by such holding back of whole shares; provided, however, shares of
Common Stock will no longer be outstanding under your option and will not be
exercisable thereafter to the extent that (1) shares are used to pay the
exercise price pursuant to the "net exercise," (2) shares are delivered to you
as a result of such exercise, and (3) shares are withheld by the Company to
satisfy tax withholding obligations.




15. WHOLE SHARES. You may exercise your option only for whole shares of Common
Stock.




16. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option also must comply
with other applicable laws and regulations governing your option, and you may
not exercise your option if the Company determines that such exercise would not
be in material compliance with such laws and regulations.




17. TERM. You may not exercise your option before the commencement of its term
or after its term expires. The term of your option commences on the Date of
Grant and expires upon the earliest of the following:




immediately upon the termination of your Continuous Service for Cause;




(a) three (3) months after the termination of your Continuous Service for any
reason other than Cause, Disability or death, provided that if during any part
of such three- (3-) month period you may not exercise your option solely because
of the condition set forth in the preceding paragraph relating to "Securities
Law Compliance," your option shall not expire until the earlier of the
Expiration Date or until it shall have been exercisable for an aggregate period
of three (3) months after the termination of your Continuous Service;




(b) twelve (12) months after the termination of your Continuous Service due to
your Disability;




(c) eighteen (18) months after your death if you die either during your
Continuous Service or within three (3) months after your Continuous Service
terminates for any reason other than Cause;




(d) the Expiration Date indicated in your Grant Notice; or




(e) the day before the tenth (10th) anniversary of the Date of Grant.

If your option is an Incentive Stock Option, note that, to obtain the federal
income tax advantages associated with an Incentive Stock Option, the Code
requires that at all times beginning on the date of grant of your option and
ending on the day three (3) months before the date of your option's exercise,
you must be an employee of the Company or an Affiliate, except in the event of
your death or Disability. The Company has provided for extended exercisability
of your option under certain circumstances for your benefit but cannot guarantee
that your option will necessarily be treated as an Incentive Stock Option if you
continue to provide services to the Company or an Affiliate as a Consultant or
Director after your employment terminates or if you otherwise exercise your
option more than three (3) months after the date your employment terminates.




18. EXERCISE.




(a) You may exercise the vested portion of your option (and the unvested portion
of your option if your Grant Notice so permits) during its term by delivering a
Notice of Exercise (in a form designated by the Company) together with the
exercise price to the Secretary of the Company, or to such other person as the
Company may designate, during regular business hours, together with such
additional documents as the Company may then require.




(b) By exercising your option you agree that, as a condition to any exercise of
your option, the Company may require you to enter into an arrangement providing
for the payment by you to the Company of any tax withholding obligation of the
Company arising by reason of (1) the exercise of your option, (2) the lapse of
any substantial risk of forfeiture to which the shares of Common Stock are
subject at the time of exercise, or (3) the disposition of shares of Common
Stock acquired upon such exercise.




(c) If your option is an Incentive Stock Option, by exercising your option you
agree that you will notify the Company in writing within fifteen (15) days after
the date of any disposition of any of the shares of the Common Stock issued upon
exercise of your option that occurs within two (2) years after the date of your
option grant or within one (1) year after such shares of Common Stock are
transferred upon exercise of your option.




19. TRANSFERABILITY. Your option is not transferable, except by will or by the
laws of descent and distribution, and is exercisable during your life only by
you. Notwithstanding the foregoing, by delivering written notice to the Company,
in a form satisfactory to the Company, you may designate a third party who, in
the event of your death, shall thereafter be entitled to exercise your option.




20. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or service
contract, and nothing in your option shall be deemed to create in any way
whatsoever any obligation on your part to continue in the employ of the Company
or an Affiliate, or of the Company or an Affiliate to continue your employment.
In addition, nothing in your option shall obligate the Company or an Affiliate,
their respective stockholders, Boards of Directors, Officers or Employees to
continue any relationship that you might have as a Director or Consultant for
the Company or an Affiliate.




21. WITHHOLDING OBLIGATIONS.




(a) At the time you exercise your option, in whole or in part, or at any time
thereafter as requested by the Company, you hereby authorize withholding from
payroll and any other amounts payable to you, and otherwise agree to make
adequate provision for (including by means of a "cashless exercise" pursuant to
a program developed under Regulation T as promulgated by the Federal Reserve
Board to the extent permitted by the Company), any sums required to satisfy the
federal, state, local and foreign tax withholding obligations of the Company or
an Affiliate, if any, which arise in connection with the exercise of your
option.




(b) Upon your request and subject to approval by the Company, in its sole
discretion, and compliance with any applicable legal conditions or restrictions,
the Company may withhold from fully vested shares of Common Stock otherwise
issuable to you upon the exercise of your option a number of whole shares of
Common Stock having a Fair Market Value, determined by the Company as of the
date of exercise, not in excess of the minimum amount of tax required to be
withheld by law (or such lower amount as may be necessary to avoid variable
award accounting). If the date of determination of any tax withholding
obligation is deferred to a date later than the date of exercise of your option,
share withholding pursuant to the preceding sentence shall not be permitted
unless you make a proper and timely election under Section 83(b) of the Code,
covering the aggregate number of shares of Common Stock acquired upon such
exercise with respect to which such determination is otherwise deferred, to
accelerate the determination of such tax withholding obligation to the date of
exercise of your option. Notwithstanding the filing of such election, shares of
Common Stock shall be withheld solely from fully vested shares of Common Stock
determined as of the date of exercise of your option that are otherwise issuable
to you upon such exercise. Any adverse consequences to you arising in connection
with such share withholding procedure shall be your sole responsibility.




(c) You may not exercise your option unless the tax withholding obligations of
the Company and/or any Affiliate are satisfied. Accordingly, you may not be able
to exercise your option when desired even though your option is vested, and the
Company shall have no obligation to issue a certificate for such shares of
Common Stock or release such shares of Common Stock from any escrow provided for
herein unless such obligations are satisfied.




22. NOTICES. Any notices provided for in your option or the Plan shall be given
in writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by mail by the Company to you, five (5) days after deposit in
the United States mail, postage prepaid, addressed to you at the last address
you provided to the Company.




23. GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions of the
Plan, the provisions of which are hereby made a part of your option, and is
further subject to all interpretations, amendments, rules and regulations, which
may from time to time be promulgated and adopted pursuant to the Plan. In the
event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.




* * [NOTE: THIS IS THE END OF THE DOCUMENT] * *




NOTICE OF EXERCISE


 





    	
    CHORDIANT SOFTWARE, INC.

20400 Stevens Creek Boulevard Suite 400

Cupertino, California 95014	
    
     	
    Date of Exercise: _______________

 




Ladies and Gentlemen:




This constitutes notice under my stock option that I elect to purchase the
number of shares for the price set forth below.


	
    Type of option (check one):	
    Incentive
[ ]	
    Nonstatutory
[ ]
	
    Stock option dated:	
    _____________________	
     
	
    Number of shares as to which option is exercised:	
    _____________________	
     
	
    Certificates to be issued in name of:	
    _____________________	
     
	
    Total exercise price:	
    $____________________	
     
	
    Cash payment delivered herewith:	
    $____________________	
     
	
    Value of _____ shares of Chordiant Software, Inc. common stock delivered
    herewith1:	
     $____________________
	
     



By this exercise, I agree (i) to provide such additional documents as you may
require pursuant to the terms of the 2005 Equity Incentive Plan, (ii) to provide
for the payment by me to you (in the manner designated by you) of your
withholding obligation, if any, relating to the exercise of this option, and
(iii) if this exercise relates to an incentive stock option, to notify you in
writing within fifteen (15) days after the date of any disposition of any of the
shares of Common Stock issued upon exercise of this option that occurs within
two (2) years after the date of grant of this option or within one (1) year
after such shares of Common Stock are issued upon exercise of this option.



Very truly yours,

 

1    Shares must meet the public
trading requirements set forth in the option.  Shares must be valued in
accordance with the terms of the option being exercised, must have been owned
for the minimum period required in the option, and must be owned free and clear
of any liens, claims, encumbrances or security interests.  Certificates
must be endorsed or accompanied by an executed assignment separate from
certificate.

CHORDIANT SOFTWARE, INC.

STOCK OPTION GRANT NOTICE

(2005 EQUITY INCENTIVE PLAN)



Chordiant Software, Inc. (the "Company"), pursuant to its 2005 Equity
Incentive Plan (the "Plan"), hereby grants to Optionholder an option to
purchase the number of shares of the Company's Common Stock set forth below.
This option is subject to all of the terms and conditions as set forth herein
and in the Stock Option Agreement, the Plan and the Notice of Exercise, all of
which are attached hereto and incorporated herein in their entirety.

	
    Optionholder:	
     	
    _____________________________________________
	
    Date of Grant:	
     	
    _____________________________________________
	
    Vesting Commencement Date:	
    	
    _____________________________________________
	
    Number of Shares Subject to Option:	
     	
    _____________________________________________
	
    Exercise Price (Per Share):	
     	
    _____________________________________________
	
    Total Exercise Price:	
     	
    _____________________________________________
	
    Expiration Date:	
     	
    _____________________________________________



 




    	
    Type of Grant:	
     Incentive Stock Option2	
    Nonstatutory Stock Option



[DRAFTING NOTE: Options that are exercisable by non-exempt employees (those
subject to wage overtime rules) within six months after the date of grant may
affect the calculations of overtime wages. Therefore, options granted to
non-exempt employees should not be exercisable for at least six months from the
grant date; provided, that the employees may exercise if their employment is
terminated due to a change in control, their death or retirement.]

	
    Exercise Schedule:	
    Same as Vesting Schedule
	
     
	
    Vesting Schedule:	
    [1/4th of the shares vest one
    year after the Vesting Commencement Date.1/48th of the shares vest monthly
    thereafter over the next three years.]
	
     



    	
    Payment:	
    By one or a combination of the
    following items (described in the Stock Option Agreement):

    [ ] By cash or check

    [ ] Pursuant to a Registration T
    Program if the Shares are publicly traded

    [ ] By delivery of already-owned
    shares if the Shares are publicly traded



    	
     



 

Additional Terms/Acknowledgements:
The undersigned Optionholder acknowledges receipt of, and understands and agrees
to, this Stock Option Grant Notice, the Stock Option Agreement and the Plan.
Optionholder further acknowledges that as of the Date of Grant, this Stock
Option Grant Notice, the Stock Option Agreement and the Plan set forth the
entire understanding between Optionholder and the Company regarding the
acquisition of stock in the Company and supersede all prior oral and written
agreements on that subject with the exception of (i) options previously granted
and delivered to Optionholder under the Plan, and (ii) the following agreements
only:

 

OTHER AGREEMENTS:
___________________________________________________________

 

2   If
this is an Incentive Stock Option, it (plus other outstanding Incentive Stock
Options) cannot be first Exercisable for more than $100,000 in value (measured
by exercise price) in any calendar year.  Any excess over $100,000 is a
Nonstatutory Stock Option.

 

 

 

	
    
    Chordiant
    Software,
    Inc.	
     	
    Optionholder:
	
    
    By:__________________________

                     
    Signature
	
     	
    ______________________________

                           
    Signature

	
    Title:_________________________	
     	
    Date:__________________________
	
    Date:_________________________	
     	
     



ATTACHMENTS: Stock
Option Agreement, 2005 Equity Incentive Plan, and Notice of Exercise