ex10.htm


    EXHIBIT
      10.1

    


     

    AGREEMENT

     

     

    THIS
      AGREEMENT (“Agreement”),
      dated the 7th day of December, 2007 (“Effective Date”), is made by and
      between Fair Isaac Corporation, a Delaware corporation (the “Company”),
      on the one hand, and Sandell Asset Management Corp., a Cayman Islands exempted
      company (“SAMC”), Castlerigg Master Investments Ltd., a British Virgin
      Islands company ("Castlerigg Master Investments"), Castlerigg
      International Limited, a British Virgin Islands company ("Castlerigg
      International"); Castlerigg International Holdings Limited, a British Virgin
      Islands company ("Castlerigg Holdings"); Castlerigg Global Select Fund
      Limited, a Cayman Islands exempted company ("Castlerigg Global Select");
      CGS, Ltd., a Cayman Islands exempted company ("CGS"); and Castlerigg GS
      Holdings, Ltd., a Cayman Islands exempted company (“CGSH”, and
      collectively with SAMC, Castlerigg Master Investments, Castlerigg International,
      Castlerigg Holdings, Castlerigg Global Select, CGS, and CGSH, the “Sandell
      Group”), on the other hand.

     

    WHEREAS,
      the Sandell Group has filed a
      Schedule 13D with the Securities and Exchange Commission (the “SEC”) on
      June 29, 2007, as amended on October 12, 2007 and as may be amended from time
      to
      time (the "Schedule 13D");

     

    WHEREAS,
      the Company is willing to
      undertake changes to the composition of the Company's Board of Directors (the
      "Board") as set forth herein; and

     

    WHEREAS,
      the Company and the Sandell
      Group have agreed that it is in their mutual interests to enter into this
      Agreement as hereinafter described.

     

    NOW,
      THEREFORE, in consideration of the
      premises and the representations, warranties, and agreements contained herein,
      and other good and valuable consideration, the parties hereto mutually agree
      as
      follows:

     

    1.           Representations
      and Warranties of the Sandell Group. The Sandell Group hereby represents and
      warrants to the Company as follows:

                     

    
                               
        (a)         The
        Sandell Group has beneficial ownership of 2,874,000 shares of common stock
        of
        the Company and has full power and authority to enter into this Agreement
        and to
        bind the entire number of shares of the common stock of the Company which
        it
        holds, or may hold, including any shares purchased in the future, to the
        terms
        of this Agreement.


       
        (b)         This Agreement
        constitutes a valid and binding agreement of the Sandell Group. Except that
        Thomas E. Sandell may be deemed to beneficially own shares of the Company
        and
        except as set forth in Section 1(a) hereof, no “affiliate” or “associate” (as
        such terms are defined in the Securities Exchange Act of 1934, as amended
        (the
“Exchange Act”)) of the Sandell Group beneficially owns any shares or
        rights to acquire shares of common stock of the Company.

    

     

    2.           Representations
      and Warranties of the Company.  The Company hereby represents and
      warrants to the Sandell Group, as follows:

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (a)           The
      Company has full power and authority to enter into and perform its obligations
      under this Agreement, and the execution and delivery of this Agreement by the
      Company has been duly authorized by the Board and requires no further Board
      or
      stockholder action, other than amendment of the bylaws of the Company to
      increase the size of the Board by two members.

     

    (b)           This
      Agreement constitutes a valid and binding obligation of the Company and the
      performance of its terms does not constitute a violation of its certificate
      of
      incorporation or bylaws.

     

    3.           Directorships.  The
      Company agrees that:

     

    (a)           following
      the execution of this Agreement and prior to filing the definitive proxy
      statement in connection with the Company's 2008 Annual Meeting of Stockholders
      (including any adjournment or postponement thereof, the "2008 Annual
      Meeting"), the Board, at a duly convened meeting of directors, will take all
      necessary action to increase the size of the Board by two members;

     

    (b)           
      Nick Graziano (the "Sandell Nominee") will be nominated by the Board as a
      director at the 2008 Annual Meeting;

     

    (c)           
      Allan Loren (the "Additional Nominee" and together with the Sandell
      Nominee, the "Nominees"), will be nominated by the Board as a director at
      the 2008 Annual Meeting;

     

    (d)           the
      Company's Board will recommend a vote "for" the Nominees at the 2008 Annual
      Meeting, and shall solicit its stockholders to vote for such
      Nominees;

     

    (e)           proxies
      solicited by the Company's Board will be voted "for" the Nominees at the 2008
      Annual Meeting; and

     

    (f)           during
      his term of office as a director, the Sandell Nominee and the Additional Nominee
      may each be replaced by another designee of the Sandell Group who is reasonably
      acceptable to the Company's Board in the event that the Sandell Nominee or
      the
      Additional Nominee dies, is unable to perform his duties as a director, or,
      in
      the case of the Sandell Nominee, is no longer associated with the Sandell
      Group.

     

    4.           Voting
      at Meetings of Stockholders.

     

    (a)           At
      the 2008 Annual Meeting, the Sandell Group shall cause all of the shares of
      the
      Company common stock beneficially owned by it to be present for quorum purposes
      and to be voted:

     

    (i)           For
      each of (A) the Nominees and (B) the other candidates recommended by the Board
      in the Schedule 14A filed by the Company with the SEC for election to the Board
      (the "Company Nominees"); provided that the Company Nominees are
      each either current members of the Board or otherwise reasonably acceptable
      to
      the Sandell Group; and

     

    (ii)           for
      the ratification of the selection of the Company’s independent
      auditors.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

     

    5.           The
      Sandell Group's Prohibited Conduct.  During the period commencing
      with the execution of this Agreement and ending on the earlier to occur of
      (a)
      the date that is eighty (80) days prior to the date of the Company's 2009 Annual
      Meeting of Stockholders (provided, however, that if the Board takes any
      action to amend the Company's restated bylaws in such a manner as to increase
      the time period prior to the 2009 Annual Meeting of Stockholders by which a
      holder of the Company's common stock must provide timely notice to the Company
      of (i) its nomination of a person or persons to the Board at a meeting of the
      Company's stockholders, (ii) or of its proposal to bring business before a
      meeting of the Company's stockholders (clause (i) and (ii) together, the
      "Stockholder Matters"), then the Standstill Period (as defined herein)
      shall expire ten (10) days prior to the date on which a stockholder must give
      notice to the Company with respect to any Stockholder Matters), and (b) a
      material breach by the Company of its obligations under this Agreement (the
      "Standstill Period"), neither the Sandell Group nor any of its controlled
      affiliates shall, without the prior written consent of the Company:

     

    (a)
      acquire or agree to acquire, or
      publicly offer or propose to acquire, directly or indirectly, by purchase or
      otherwise, any voting securities or direct or indirect rights or options to
      acquire any voting securities of the Company or any subsidiary thereof, or
      any
      assets of the Company or any subsidiary or division thereof; provided,
      however, that nothing herein shall limit the ability of the Sandell Group
      to (i) transfer any voting securities or direct or indirect rights or options
      to
      acquire any voting securities of the Company to any of its controlled
      affiliates, so long as such any such controlled affiliates agree to be bound
      by
      the terms of this Agreement and execute a joinder agreement to this Agreement,
      in the form attached hereto as Exhibit A (a "Joinder Agreement"), (ii)
      enter into any swap or other arrangement whereby it acquires the economic
      consequences of ownership of the common stock without also acquiring the voting
      or other rights, privileges or powers associated with the ownership of the
      underlying common stock, or (iii) subject to applicable law, including federal
      securities laws prohibiting insider trading, acquire up to ten percent (10%)
      of
      the outstanding shares of Company common stock;

     

    (b)
      other than as provided in this
      Agreement, seek or propose to influence or control the management or the
      policies of the Company (provided that the Nominees' actions (or those
      of their replacements as contemplated by Section 3) as members of the Board
      shall not be deemed to violate the foregoing) or to obtain representation on
      the
      Board (other than the nomination of the Nominees), directly or indirectly engage
      in any activities in opposition to the recommendation of the Board (including
      the recommendation of the Nominees and the Company Nominees as directors to
      be
      elected at the 2008 Annual Meeting), submit any proposal (whether pursuant
      to
      Rule 14a-8 or otherwise) or nomination of a director or directors for
      stockholder action, or solicit, or encourage or in any way participate in the
      solicitation of, any proxies or consents with respect to any voting securities
      of the Company, provided, however, that the foregoing shall not
      prohibit the Sandell Group from (i) making public statements (including
      statements contemplated by Rule 14a-1(1)(2)(iv) under the Exchange Act), or
      (ii)
      engaging in discussions with other stockholders or (iii) soliciting, or
      encouraging or participating in the solicitation of, proxies or consents with
      respect to voting securities of the Company (so long as such discussions are
      in
      compliance with subsection (d) hereof (clauses (i), (ii) and (iii), together,
      "Permitted Actions") with respect to any transaction that has been
      publicly announced by the Company involving (1) the recapitalization of the
      Company, (2) 

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    an
      acquisition, disposition or sale of assets or a business by the Company where
      (A) the consideration to be received or paid in such transaction exceeds $400
      million in the aggregate or (B) requires approval by the holders of common
      stock
      of the Company, or (3) a change of control of the Company (each, a "Material
      Transaction"), provided, further, that in the event that one of the
      Nominees votes against an acquisition, disposition or sale of assets or a
      business by the Company, which is neither a Material Transaction nor an
      acquisition, disposition or sale of assets or a business by the Company where
      the consideration to be received or paid in such transaction is less than $125
      million in the aggregate, at the Board meeting approving such transaction,
      the
      Company will make a public statement that such Nominee so voted;

     

    (c)
      make any public announcement with
      respect to, or publicly offer to effect, seek or propose (with or without
      conditions) a merger, consolidation, business combination or other extraordinary
      transaction with or involving the Company or any of its subsidiaries or any
      of
      its or their securities or assets, provided, however, that nothing in
      this subsection (c) shall restrict the Sandell Group from taking Permitted
      Actions with respect to a Material Transaction;

     

    (d)
      (i) form, join or in any way
      participate in a "group" as defined in Section 13(d)(3) of the Exchange Act,
      and
      the rules and regulations promulgated thereunder, other than a "group" that
      includes all or some lesser number of persons identified as members of the
      Sandell Group, or (ii) enter into any negotiations, arrangements or
      understandings with any third parties, other than members of the Sandell Group
      solely with respect to the existing members of the Sandell Group, in connection
      with becoming a "group" as defined in Section 13(d)(3) of the Exchange
      Act;

     

    (e)
      publicly disparage any member of
      the Board or management of the Company; or

     

    (f)
      publicly seek or request
      permission to do any of the foregoing, request to amend or waive any provision
      of this Section 5 (including, without limitation, any of clauses (a)-(e)
      hereof), or make or seek permission to make any public announcement with respect
      to any of the foregoing.

     

     

    6.           Transfer
      Restrictions.  The Sandell Group agrees that, during the
      Standstill Period, it shall not offer, pledge, sell, contract to sell, sell
      any
      option or contract to purchase, purchase any option or contract to sell, grant
      any option, right or warrant to purchase, lend (other than in a customary
      commingled brokerage account in the ordinary course of business), or otherwise
      transfer or dispose of, directly or indirectly, any shares of common stock
      or
      any securities convertible into or exercisable or exchangeable, directly or
      indirectly, for common stock, whether any such transaction described above
      is to
      be settled by delivery of common stock or such other securities, in cash or
      otherwise (any such action a "Transfer"), in each case without the prior
      written consent of the Company; provided that the foregoing shall not
      restrict the Sandell Group from (i) a Transfer of any shares to a controlled
      affiliate which agrees to be bound by the terms of this Agreement and executes
      a
      Joinder Agreement, (ii) subject to compliance with law, the Transfer of shares
      in either (1) brokers' transactions (within the meaning of Rule 144(g) of the
      Securities Act of 1933 (the "Securities Act")), but not in transactions
      directly with a market maker (as defined in Section 3(a)(38) of the Exchange
      Act), or (2) private Transfers (including transactions with, or indirectly
      through, a market maker), in a single Transfer or series of related Transfers,
      so long as the Sandell Group, 

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    at
      the time of such Transfer, does not have actual knowledge, after reasonable
      inquiry, that such Transfer or series of Transfers would result in the ultimate
      purchaser of such shares of common stock from the Sandell Group beneficially
      owning, together with its affiliates, following such Transfer or Transfers,
      in
      excess of five percent (5%) of the Company's common stock in the aggregate,
      or
      (iii) Transfers made pursuant to (x) tender offers in respect of the Company's
      common stock made by the Company or any third party, or (y) repurchase offers
      in
      respect of the Company's common stock made directly with the
      Company.

     

    7.           Resignation.  Each
      of the Nominees shall immediately tender his resignation from the Board, if
      requested by the Board as a result of a majority vote of the directors, other
      than the Nominees, in favor of such resignations from the Board, in the event
      that the Sandell Group's beneficial ownership of the Company's common stock
      becomes less than three percent (3%) of the outstanding shares of common stock
      of the Company solely as a result of a Transfer or series of Transfers by the
      Sandell Group.

     

    8.           Nondisparagement.  During
      the Standstill Period, the Company shall not publicly disparage the Sandell
      Group or any member of the management of the Sandell Group.

     

    9.           Public
      Announcement.  The parties shall promptly disclose the existence
      of this Agreement after its execution pursuant to a joint press release in
      the
      form attached hereto as Exhibit B; however, neither party shall disclose the
      existence of this Agreement until the press release is issued.

     

    10.           Remedies.
      The Company and the Sandell Group acknowledge and agree that a breach or
      threatened breach by either party may give rise to irreparable injury
      inadequately compensable in damages, and accordingly each party shall be
      entitled to injunctive relief to prevent a breach of the provisions hereof
      and
      to enforce specifically the terms and provisions hereof in any state or federal
      court having jurisdiction, in addition to any other remedy to which such
      aggrieved party may be entitled to at law or in equity. In the event either
      party institutes any legal action to enforce such party’s rights under, or
      recover damages for breach of, this Agreement, the prevailing party or parties
      in such action shall be entitled to recover from the other party or parties
      all
      costs and expenses, including but not limited to reasonable attorneys’ fees,
      court costs, witness fees, disbursements and any other expenses of litigation
      or
      negotiation incurred by such prevailing party or parties.

     

    11.           Notices.
      All notice requirements and other communications shall be deemed given when
      delivered or on the following business day after being sent by overnight courier
      with a nationally recognized courier service such as Federal Express, addressed
      to the Company, SAMC, Castlerigg Master Investments, Castlerigg International,
      Castlerigg Holdings, Castlerigg Global Select, CGS, CGSH and Mr. Sandell as
      follows:

     

    The
      Company:

    Fair
      Isaac Corporation

    901
      Marquette Avenue, Suite 3200

    Minneapolis,
      MN 55402-3232

    Facsimile:  (612)
      758-6002

    Attention:
      General Counsel

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    With
      a copy to (which shall not constitute notice):

    


    Skadden,
      Arps, Slate, Meagher & Flom LLP

    525
      University Avenue, Suite 1100

    Palo
      Alto, California 94301

    Facsimile:    (650)
      470-4570

    Attention:    Kenton
      J. King

     Celeste
      E. Greene

    


    The
      Sandell Group:

    Sandell
      Asset Management Corp.

    40
      W 57th Street,
      26th
      Floor

    New
      York, NY 10019

    Facsimile:
      (212) 603-5725

    Attn:
      General Counsel

    


    with
      copies to (which shall not constitute notice):

    


    Schulte
      Roth & Zabel LLP

    919
      Third Avenue

    New
      York, NY 10022

    Facsimile:
      (212) 593-5955

    Attention:  Marc
      Weingarten

     

    12.           Entire
      Agreement. This Agreement constitutes the entire agreement between the
      parties hereto pertaining to the subject matter hereof and supersedes all prior
      and contemporaneous agreements understandings, negotiations and discussions
      of
      the parties in connection therewith not referred to herein.

     

    13.           Counterparts;
      Facsimile. This Agreement may be executed in any number of counterparts and
      by the parties hereto in separate counterparts, and signature pages may be
      delivered by facsimile, each of which when so executed shall be deemed to be
      an
      original and all of which taken together shall constitute one and the same
      agreement.

     

    14.           Headings.
      The headings in this Agreement are for convenience of reference only and shall
      not limit or otherwise affect the meaning hereof.

     

    15.           Governing
      Law. This Agreement shall be governed by and construed and enforced in
      accordance with the laws of the State of Delaware, without regard to choice
      of
      law principles that would compel the application of the laws of any other
      jurisdiction.

     

    16.           Severability.
      In the event one or more of the provisions of this Agreement should, for any
      reason, be held to be invalid, illegal or unenforceable in any respect, such
      invalidity, illegality or unenforceability shall not affect any other provisions
      of this Agreement, and this Agreement shall be construed as if such invalid,
      illegal or unenforceable provision had never been contained herein.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    17.           Successors
      and Assigns. This Agreement shall not be assignable by any of the parties to
      this Agreement.  This Agreement, however, shall be binding on
      successors of the parties hereto.

     

    18.           Survival
      of Representations, Warranties and Agreements. All representations,
      warranties, covenants and agreements made herein shall survive the execution
      and
      delivery of this Agreement.

     

    19.           Amendments.
      This Agreement may not be modified, amended, altered or supplemented except
      upon
      the execution and delivery of a written agreement executed by all of the parties
      hereto.

     

    20.           Further
      Action. Each party agrees to execute any and all documents, and to do and
      perform any and all acts and things necessary or proper to effectuate or further
      evidence the terms and provisions of this Agreement.

     

    21.           Consent
      to Jurisdiction. Each of the parties hereby irrevocably submits to the
      exclusive jurisdiction of any state court sitting in the State of Delaware
      in
      any action or proceeding arising out of or relating to this Agreement and each
      of the parties hereby irrevocably agrees that all claims in respect of such
      action or proceeding may be heard and determined in any such court.

     

    22.           Expenses.
      Each party agrees to bear its own expenses in connection with the transactions
      contemplated hereby.

     

     

    


     

     

    [Signature
      Page Follows]

     

     

    


     


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


     

    The
      Company and the Sandell Group each
      indicate its agreement with the foregoing by signing and returning one copy
      of
      this agreement, whereupon this letter agreement will constitute their agreement
      with respect to the subject matter hereof.

     

    


    


    Accepted
      to and agreed, as of the date

    first
      written above:

    


    Fair
      Isaac Corporation

    


    By:          /s/
      Mark N.
      Greene                                           

    Name:     Mark
      N.
      Greene                                           

    Title:       CEO                                           

    


    


    Sandell
      Asset Management Corp.

    


    By:          /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   

    


    


    Castlerigg
      Master Investments Ltd.

    


    By:           /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   

    


    


    Castlerigg
      International Limited

    


    By:          /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   

    


    


    Castlerigg
      International Holdings Limited

    


    By:          /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   

    


    


    Castlerigg
      Global Select Fund Limited

    


    By:          /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   

    


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    CGS,
      Ltd.

    


    By:          /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   

    


    


    Castlerigg
      GS Holdings, Ltd.

    


    By:          /s/
      Thomas E.
      Sandell                                                   

    Name:     Thomas
      E.
      Sandell                                                      

    Title:        Chief
      Executive
      Officer                                                   


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    EXHIBIT
      A

    


    FORM
      OF JOINDER AGREEMENT

    


    The
      undersigned hereby agrees, effective as of the date hereof, to become a party
      to
      that certain Agreement, dated as of December 7, 2007, by and among Fair Isaac
      Corporation, a Delaware corporation (the "Company"), Sandell Asset Management
      Corp., a Cayman Islands exempted company (“SAMC”), Castlerigg Master Investments
      Ltd., a British Virgin Islands company ("Castlerigg Master Investments"),
      Castlerigg International Limited, a British Virgin Islands company ("Castlerigg
      International"); Castlerigg International Holdings Limited, a British Virgin
      Islands company ("Castlerigg Holdings"); Castlerigg Global Select Fund Limited,
      a Cayman Islands exempted company ("Castlerigg Global Select"); CGS, Ltd.,
      a
      Cayman Islands exempted company ("CGS"); and Castlerigg GS Holdings, Ltd.,
      a
      Cayman Islands exempted company (“CGSH” and collectively with SAMC, Castlerigg
      Master Investments, Castlerigg International, Castlerigg Holdings, Castlerigg
      Global Select, CGS, and CGSH, the “Sandell Group”) (the "Agreement"). By
      executing this joinder agreement, the undersigned hereby agrees to be, and
      shall
      be, deemed a member of the "Sandell Group" for all purposes of the Agreement,
      entitled to the rights and subject to the obligations thereunder with respect
      to
      the voting securities of the Company acquired from the Sandell
      Group.

    


    The
      address and facsimile number to which notices may be sent to the undersigned
      is
      as follows:

     

    


                       Facsimile
      No.:

    


     

    
      	By:	 
	 
	Name:	 
	 
	 Title:	 
	 
	 Date: