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EXHIBIT 99.4
ADDENDUM
TO
STOCK OPTION AGREEMENT
The following provisions are hereby incorporated into, and are
hereby made a part of, that certain Stock Option Agreement (the "Option
Agreement") by and between Credit Management Solutions, Inc. (the
"Corporation") and ___________________________________________ ("Optionee")
evidencing the stock option (the "Option") granted on
___________________________________ to Optionee under the terms of the
Corporation's 1997 Stock Incentive Plan, and such provisions shall be effective
immediately. All capitalized terms in this Addendum, to the extent not
otherwise defined herein, shall have the meanings assigned to them in the
Option Agreement.
INVOLUNTARY TERMINATION FOLLOWING
CORPORATE TRANSACTION/CHANGE IN CONTROL
1. To the extent the Option is, in connection with a
Corporate Transaction, to be assumed by the successor entity (or its parent
company), the Option shall not accelerate upon the occurrence of that Corporate
Transaction, and the Option shall accordingly continue, over Optionee's period
of Service after the Corporate Transaction, to become exercisable for the
Option Shares in one or more installments in accordance with the provisions of
the Option Agreement. However, immediately upon an Involuntary Termination of
Optionee's Service within eighteen (18) months following such Corporate
Transaction, the Option (or any replacement grant), to the extent outstanding
at the time but not otherwise fully exercisable, shall automatically accelerate
so that the Option shall become immediately exercisable for all the Option
Shares at the time subject to the Option and may be exercised for any or all of
those Option Shares as fully vested shares.
2. The Option shall not accelerate upon the occurrence
of a Change in Control, and the Option shall, over Optionee's period of Service
following such Change in Control, continue to become exercisable for the Option
Shares in one or more installments in accordance with the provisions of the
Option Agreement. However, immediately upon an Involuntary Termination of
Optionee's Service within eighteen (18) months following the Change in Control,
the Option, to the extent outstanding at the time but not otherwise fully
exercisable, shall automatically accelerate so that the Option shall become
immediately exercisable for all the Option Shares at the time subject to the
Option and may be exercised for any or all of those Option Shares as fully
vested shares.
3. The Option shall remain so exercisable until the
earlier of (i) the Expiration Date or (ii) the expiration of the one (1)-year
period measured from the date of such Involuntary Termination.
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4. For purposes of this Addendum the following
definitions shall be in effect:
(i) An INVOLUNTARY TERMINATION shall mean the
termination of Optionee's Service by reason of:
(A) Optionee's involuntary dismissal or
discharge by the Corporation for reasons other than
Misconduct, or
(B) Optionee's voluntary resignation
following (A) a change in Optionee's position with the
Corporation (or Parent or Subsidiary employing Optionee) which
materially reduces Optionee's level of responsibility, (B) a
reduction in Optionee's level of compensation (including base
salary, fringe benefits and target bonus under any
corporate-performance based bonus or incentive programs) by
more than fifteen percent (15%) or (C) a relocation of
Optionee's place of employment by more than fifty (50) miles,
provided and only if such change, reduction or relocation is
effected by the Corporation without Optionee's consent, and
(ii) a CHANGE IN CONTROL shall be deemed to occur
in the event of a change in ownership or control of the Corporation
effected through either of the following transactions:
(A) the acquisition, directly or
indirectly, by any person or related group of persons (other
than the Corporation or a person that directly or indirectly
controls, or is controlled by, or is under common control
with, the Corporation) of beneficial ownership (within the
meaning of Rule 13d-3 of the Securities Exchange Act of 1934,
as amended) of securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation's
outstanding securities pursuant to a tender or exchange offer
made directly to the Corporation's stockholders which the
Board does not recommend such stockholders to accept, or
(B) a change in the composition of the
Board over a period of thirty-six (36) consecutive months or
less such that a majority of the Board members ceases, by
reason of one or more contested elections for Board
membership, to be comprised of individuals who either (i) have
been Board members continuously since the beginning of such
period or (ii) have been elected or nominated for election as
Board members during such period by at least a majority of the
Board members described in clause (i) who were still in office
at the time such election or nomination was approved by the
Board.
5. The provisions of Paragraph 1 of this Addendum shall
govern the period
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for which the Option is to remain exercisable following the Involuntary
Termination of Optionee's Service within eighteen (18) months after the
Corporate Transaction or Change in Control and shall supersede any provisions
to the contrary in Paragraph 6 of the Option Agreement.
IN WITNESS WHEREOF, Credit Management Solutions, Inc. has
caused this Addendum to be executed by its duly-authorized officer, and
Optionee has executed this Addendum, all as of the Effective Date specified
below.
CREDIT MANAGEMENT SOLUTIONS, INC.
By: ____________________________________
Title: _________________________________
________________________________________
OPTIONEE
EFFECTIVE DATE: _________________, 199__
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