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                                                                    Exhibit 10.9

                     [Form of Change of Control Agreement]

[Date]



[Name]
[Title]
Callidus Software Inc.
160 West Santa Clara Street, Suite 1400
San Jose, California 95113

Dear     :

This letter modifies any Stock Option Agreement ("Option Agreement") which you
may now or hereafter have under the 1997 Stock Option Plan, as amended, of
Callidus Software, Inc. (the "Company"). This letter provides for accelerated
vesting of the options subject to the Option Agreement (the "Options") under the
conditions described below.

In the event that you are "Involuntarily Terminated," except for "Cause," at any
time during the period commencing 90 days prior to a "Change of Control" of the
Company and ending on the first anniversary of the "Change of Control" of the
Company, you shall receive vesting of your Option, over and above the vesting
provided for in your Option Agreement, equal to the greater of (i) 50% of the
shares subject to the Option which otherwise would have remained unvested
immediately following the Change of Control or (ii) that number of shares which
otherwise would have vested under the Option Agreement through the first
anniversary of the Change of Control, assuming that your employment with the
Company would have continued through the date of such anniversary.

      For purposes of the above, "Change of Control" means:

      (i)   The acquisition by any "person" (as such term is used in Sections
            13(d) and 14(d) of the Exchange Act) of the "beneficial ownership"
            (as defined in Rule 13d-3 under said Act), directly or indirectly,
            of securities of the Company representing fifty percent (50%) or
            more of the total voting power represented by the Company's then
            outstanding voting securities (it being understood that securities
            owned by any person on the date hereof shall not be counted against
            such limit with respect to such person); or

      (ii)  A change in the composition of the Board occurring within a rolling
            two-year period, as a result of which fewer than a majority of the
            directors are Incumbent Directors. "Incumbent Directors" shall mean
            directors who either (A) are members of the Board as of date hereof,
            or (B) are elected, or nominated for election, to the Board with the
            affirmative votes of at least a majority of the Incumbent Directors
            at the time of such election or nomination (but shall not include an
            individual not otherwise an Incumbent Director whose election or
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            nomination is in connection with an actual or threatened proxy
            contest relating to the election of directors to the Board); or

      (iii) A merger or consolidation of the company with any other entity other
            than a merger or consolidation which would result in the voting
            securities of the Company outstanding immediately prior thereto
            continuing to represent (either by remaining outstanding or by being
            converted into voting securities of the surviving entity (including
            the parent corporation of such surviving entity)) at least fifty
            percent (50%) of the total voting power represented by the voting
            securities of the Company or such surviving entity outstanding
            immediately after such merger or consolidation, or a sale or
            disposition by the Company of all or substantially all the Company's
            assets.

The term "Surviving Entity" shall refer to the Company in the case of a Change
of Control event described in clause (i) or (ii) above, or the entity surviving
the merger, consolidation or sale of substantially all of the assets and
continuing with the assets or business of the Company in the case of a Change of
Control event described in clause (iii) above.

      For purposes of the above, "Involuntarily Terminated" means any of the
following:

      (i)   Your actual termination by the Company;

      (ii)  The failure of the Surviving Entity to provide you with principle
            duties related in nature and responsibility to the principle duties
            which you had at the Company immediately prior to the Change of
            Control (it being understood that equivalency of title or reporting
            relationship shall not be required);

      (iii) The Surviving Entity conditioning your continued employment on your
            performing your duties at a regular work place located more than 50
            miles from your regular work place immediately prior to the Change
            of Control;

      (iv)  The failure of the Surviving Entity to pay you a rate of cash
            compensation equivalent to your rate of compensation immediately
            prior to the Change of Control, measured by comparing base salary
            plus bonuses, commissions and similar incentives on an annualized
            basis (it being understood that a bonus, commission or similar
            incentive will be treated as equivalent to the prior year's bonus,
            commission or similar incentive so long as the dollar amounts and
            targets are equivalent, regardless of whether you actually achieve
            the same dollar amounts and targets as in the prior year);

      (v)   The failure of the Surviving Entity to assume your Option on
            substantially the same terms as it exists immediately prior to the
            Change of Control, or an attempt by the Surviving Entity to modify
            the vesting schedule of the Option in a manner adverse to you.

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      For purposes of the above, "Cause" means:

      (i)   your willful failure to substantially perform your principle duties
            or gross negligence in the performance of your duties;

      (ii)  your conviction of or entry of a plea of guilty or nolo contendere
            to a felony or other crime causing material harm to the Company; or

      (iii) a willful act by you that constitutes gross misconduct; or

      (iv)  an act of fraud or misappropriation of funds or property against the
            Company.

The modification to the terms of the vesting schedule of your Option(s) as
described in this letter has been approved by the Company's Board of Directors
and is effective immediately.



Sincerely,






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