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Exhibit 10.60

August 20, 2004

Mr. John Mutch
P.O. Box 1590
Rancho Santa Fe, CA 92067

Re:Amendment to Employment Letter dated August 14, 2003 between Peregrine
Systems, Inc. and Mr. John Mutch (the "Original Agreement").

Dear John:

        On behalf of the Board of Directors (the "Board") of Peregrine
Systems, Inc. ("PSI"), we are pleased to amend and restate the terms of your
Original Agreement with PSI as set forth in this letter agreement (the
"Employment Agreement"). This Employment Agreement amends and restates in its
entirety the Original Agreement, effective as of May 25, 2004. By executing a
copy of this Employment Agreement, you will agree to continue to serve as
President and Chief Executive Officer of PSI, and to the restatement of the
terms of your Original Agreement as follows:

        1.    TITLE; BASE SALARY.    You will continue to be employed as
President and Chief Executive Officer of PSI and to report to the Board. Your
base salary will continue at the rate of $400,000 annually through July 31,
2004. From and after August 1, 2004, your base salary will be increased to the
rate of $450,000 annually. Your base salary will be payable in accordance with
PSI's standard payroll practices. So long as you serve as PSI's Chief Executive
Officer, PSI shall include you on the slate of directors nominated for election
at each annual meeting of PSI stockholders.

        2.    EMPLOYMENT TERM.    The term of your employment as President and
Chief Executive Officer under this Employment Agreement (the "Employment Term")
will end when it is terminated in accordance with Section 6.

        3.    BONUS.    You will be eligible to receive bonuses as set forth
below.

        (a)    Fiscal 2004.    You acknowledge receipt of payment in the amount
of $178,500 on June 15, 2004 pursuant to PSI's Management Incentive Compensation
Plan ("MICP") in recognition of your achievements in fiscal 2004, and the
ability to earn up to an additional $59,500, based on the confirmation of
attainment of bonus objectives previously established by the Board in
consultation with you, to be paid in accordance with the terms of the MICP and
at the time or times payments are made to other participants in the MICP.

        (b)    Fiscal 2005.    In fiscal 2005, you will be eligible to
participate in the MICP with a target bonus of $400,000, based on the attainment
of reasonable bonus objectives determined by the Board in consultation with you
(which shall include, without limitation, the attainment of fiscal 2005 earnings
and revenue targets consistent with PSI's fiscal 2005 budget approved by the
Board), to be paid in accordance with the terms of the MICP and at the time or
times payments are made to other participants in the MICP.

        (c)    Fiscal 2006 and Beyond.    In fiscal 2006 and subsequent years,
you will be eligible to participate in the MICP or a successor bonus plan with a
target bonus and reasonable bonus objectives to be determined by the Board in
consultation with you, to be paid in accordance with the terms of the MICP or a
successor plan and at the time or times payments are made to other participants
in such plan.

        4.    BENEFITS.    You will be eligible to participate in PSI's employee
benefit plans of general application, including, without limitation, those plans
covering medical, disability and life insurance in accordance with the rules
established for individual participation in any such plan and under applicable
law. You will be eligible for vacation and sick leave ("PTO") in accordance with
PSI polices in effect during the term of this Employment Agreement and will
receive such other benefits as PSI generally provides to its other employees of
comparable position and experience. However, you will in any event

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be eligible for at least three weeks of PTO from the commencement of your
employment through August 17, 2004, and at least four weeks of PTO during each
subsequent year of employment.

        5.    EQUITY-BASED AWARDS.    

        (a)    Options.    You acknowledge that the Compensation Committee of
the Board approved the grant to you of an option to purchase up to 350,000
shares of PSI's common stock (the "Options") under the 2003 Equity Incentive
Plan (the "Equity Incentive Plan") effective August 18, 2003 with an exercise
price of $17.00 per share of PSI common stock, the fair market value of the PSI
common stock on the date of grant and that PSI granted and you accepted the
Options subject to the terms and conditions of the Stock Option Grant Agreement,
dated August 18, 2003, between you and PSI.

        (b)    Restricted Stock Award.    You acknowledge that the Compensation
Committee of the Board approved the grant to you on May 25, 2004, as additional
compensation, of 40,000 restricted shares of PSI common stock (the "Restricted
Shares"), subject to the execution of this Employment Agreement and a Restricted
Stock Grant Notice and Restricted Stock Agreement (collectively, the "Restricted
Stock Agreement") in the form attached hereto as Exhibit A, consistent with the
terms and conditions of the Equity Incentive Plan and this Employment Agreement.

        (i)    Vesting of Restricted Shares.    All of the Restricted Shares
shall be vested immediately upon issuance.

        (ii)    Restrictions on Resale.    In addition to any restrictions of
the Equity Incentive Plan or the Restricted Stock Agreement to the contrary, you
may not sell, assign, hypothecate or otherwise transfer the Restricted Shares or
any interest therein prior to May 25, 2005, other than in connection with a Sale
Event (as defined in the PSU Agreement, as defined in Section 5(c)), a
Termination for Death or Disability, Termination without Cause or a Termination
for Good Reason (each as defined in Section 6). PSI may impose one or more of
the following restrictions as it in good faith determines appropriate to control
the timing and manner of any resales by you or other subsequent transfers by you
of any Restricted Shares: (i) restrictions under an insider trading policy,
(ii) restrictions designed to delay and/or coordinate the timing and manner of
sales by you and other security holders and (iii) restrictions as to the use of
a specified brokerage firm for such resales or other transfers. You hereby
acknowledge that the Restricted Shares have not been registered under the
Securities Act of 1933, as amended, or applicable state securities laws, and the
Restricted Shares are subject to, and the certificates representing the
Restricted Shares shall be legended to reflect, certain restrictions on transfer
pursuant to the terms of this Employment Agreement and the Equity Incentive Plan
and under applicable securities laws, and you hereby agree to comply with all
such restrictions and to execute such documents or take such other actions as
PSI may require in connection with such restrictions.

        (iii)    Limited Transferability of Restricted Shares.    The Restricted
Shares may be assigned in whole or in part during your lifetime to one or more
members of your family or to a trust established exclusively for one or more
such family members or to an entity in which you are majority owner, to the
extent such assignment is in connection with your estate or financial planning
or pursuant to a Domestic Relations Order (as defined in the Equity Incentive
Plan); provided the assignees shall hold the Restricted Shares subject to the
terms, conditions and restrictions applicable to the Restricted Shares
immediately prior to such assignment. Any assignee shall be required to execute
documentation satisfactory to PSI agreeing to be bound by all such terms,
conditions and restrictions.

        (iv)    Form S-8 Reoffer Prospectus.    Within 30 days following the
later of (A) a Sale Event, Termination for Death or Disability, Termination
without Cause or a Termination for

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Good Reason prior to May 25, 2005, and (B) the date following the occurrence of
any of the events described in clause (A) of this Subsection (b)(iv) on which
PSI first satisfies all of the requirements for the use of a registration
statement on a Form S-8 (as set forth in the General Instructions to the
Form S-8), including the use of a "reoffer prospectus" contemplated by General
Instruction C of Form S-8 (the "S-8 Requirements"), PSI will file a registration
statement on a Form S-8 including a reoffer prospectus with respect to the
Restricted Shares and, to the extent PSI continues through May 25, 2005 to
satisfy the S-8 Requirements, will maintain the effectiveness of such
registration statement and reoffer prospectus until May 25, 2005.

        Notwithstanding anything in this Subsection (b)(iv) to the contrary, if
the Board determines, in good faith, that because of the existence of material
non-public information about PSI it would be disadvantageous to PSI to file
registration statement on a Form S-8, PSI shall be entitled to delay the filing
of such registration statement until the Board determines, in good faith, that
the filing of the registration statement would no longer be disadvantageous to
PSI.

        (c)    Performance Stock Unit Award.    The Compensation Committee of
the Board has approved, subject to the execution of this Employment Agreement
and a Performance Stock Unit Agreement in the form attached hereto as Exhibit B
(the "PSU Agreement"), a grant to you of performance stock units (the "Units")
representing the right to participate in the future value of PSI on the terms
and conditions of this Employment Agreement and the PSU Agreement.

        6.    TERMINATION.    Your employment with PSI may be terminated by you
or by PSI at any time for any reason as follows:

        (a)   You may terminate your employment upon prior written notice to the
Board at any time in your discretion ("Voluntary Termination");

        (b)   PSI may terminate your employment upon written notice to you at
any time following a determination by the Board that there is "Cause" as defined
below, for such termination ("Termination for Cause");

        (c)   PSI may terminate your employment upon written notice to you at
any time in the sole discretion of the Board without a determination that there
is Cause for such termination ("Termination without Cause");

        (d)   Your employment will automatically terminate upon your death or
upon your Disability (as defined below) ("Termination for Death or Disability");
or

        (e)   You may terminate your employment upon prior written notice (the
"Notice Period") to the Board at any time following a determination by you that
there is "Good Reason" (as defined below) for such termination ("Termination for
Good Reason"), such termination to be effective at the end of the Notice Period
if PSI has not remedied the Good Reason for such termination.

        For purposes of this Employment Agreement, the term "Disability" shall
mean your inability to perform your job responsibilities for a period of 180
consecutive days or 180 days in the aggregate in any 12-month period. For
purposes of this Employment Agreement, "Cause" means (i) gross negligence or
willful misconduct in the performance of your duties to PSI (other than as a
result of a Disability); (ii) repeated and continued failure to perform your
duties and responsibilities as a PSI employee (including but not limited to your
compliance with any written policy of PSI) in good faith after having a
reasonable opportunity to cure such failure upon receiving specific written
notice of such failure from PSI; (iii) commission of any act of fraud with
respect to PSI; or (iv) conviction of a felony or a crime involving moral
turpitude if such felony or crime caused material harm to the business and
affairs of PSI; provided, however, that clause (i) of this definition of the
term "Cause" shall not apply following a Change in Control. No act or failure to
act by you shall be considered "willful" if done or

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omitted by you in good faith with reasonable belief that your action or omission
was in the best interests of PSI. For purposes of this Employment Agreement,
"Good Reason" shall mean (i) a significant reduction of your duties, title,
position or responsibilities, including a material change in your reporting
structure, which shall include, but not be limited to, (A) your no longer
reporting to the Board, or (B) your no longer serving as President and Chief
Executive Officer of PSI, that is effected without your written consent; (ii) a
substantial reduction, without good business reasons, of the facilities or
perquisites available to you immediately prior to such reduction if such
reduction is effected without your written consent; (iii) a reduction of your
base salary and target bonus as in effect immediately prior to such reduction if
such reduction is effected without your written consent (other than any such
reduction that is effected on substantially a company-wide basis in order to
reduce PSI's operating expenses); (iv) a material reduction in the aggregate
level of employee benefits made available to you when compared to the employee
benefits made available to you immediately prior to such reduction if such
reduction is effected without your written consent (other than any such
reduction that is effected on substantially a company-wide basis in order to
reduce PSI's operating expenses); or (v) the relocation of your primary office
at PSI to a facility or location that is more than fifty (50) miles away from
your primary office location immediately prior to such relocation, if such
relocation is effected without your written consent.

        7.    SEPARATION BENEFITS; CHANGE OF CONTROL PAYMENT.    Upon
termination of your employment with PSI for any reason, you will receive payment
for all salary and earned but unused paid time off ("PTO") accrued to the date
of your termination of employment in addition to any payment that you are
entitled to receive in respect of your Units. Your benefits will be continued
under PSI's then existing benefit plans and policies for so long as provided
under the terms of such plans and policies and as required by applicable law.
Under certain circumstances, you will also be entitled to receive severance
benefits as set forth below, but you will not be entitled to any other
compensation, award or damages with respect to your employment or termination.
You will also be entitled to the payments set forth in Section 7(e) upon a
Change of Control (as defined in Section 7(e)).

        (a)   In the event of your Voluntary Termination or Termination for
Cause, you will not be entitled to any cash severance benefits or additional
vesting of shares or stock options.

        (b)   Subject to your compliance with Section 9, in the event of your
Termination without Cause, Termination for Death or Disability or Termination
for Good Reason: (i) at any time prior to August 18, 2004 (the "First Year Stub
Period"), you will be entitled to a severance payment equal to your base salary
plus an amount equal to the maximum amount of the target bonus for fiscal 2005
under the MICP; or (ii) at any time after the First Year Stub Period, you will
be entitled to a severance payment equal to two (2) times your base salary plus
an amount equal to two (2) times the target bonus under the MICP or a successor
plan for the fiscal year in which the termination occurs, in either case payable
within five (5) days after the effective date of your termination; provided,
that any severance payable hereunder in the event of your Termination for Death
or Disability shall be reduced by the proceeds received by you or your heirs
pursuant to insurance policies paid for by PSI. The severance payments will be
in addition to unpaid salary, accrued PTO and accrued but unpaid bonuses for
periods ended prior to the date of termination of employment, each of which will
be payable in accordance with applicable law and PSI's policies as in effect at
the time of your termination. In addition, in the event of your Termination
without Cause or Termination for Good Reason at any time after the First Year
Stub Period, all Options that would have vested during the 12 months following
the date of termination shall become immediately exercisable on such date.

        (c)   In the event of your Termination for Death or Disability, all
Options that would have vested during the 12 months following the date of
termination shall become immediately exercisable on such date.

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        (d)   In the event of your Termination without Cause, Termination for
Good Reason or Termination for Death or Disability, PSI will reimburse you for
any verified payments that you actually make pursuant to your rights under COBRA
(as defined below) in order to continue your coverage under PSI's medical,
dental and vision insurance benefit plans, subject to the same coverage levels
and employee contribution rates as in effect prior to the termination, during
the Continuation Period (as defined below). In addition, during (and only
during) the Continuation Period, PSI will, at its expense continue your coverage
under any life insurance benefits in which you are participating in your
capacity as a PSI employee immediately prior to the date your employment
terminated, to the extent permitted under any such life insurance benefit
plan(s) or policy(ies) or pursuant to any riders thereto that PSI may obtain
using commercially reasonable efforts and without increasing PSI's cost to
maintain such plan(s) or policy(ies) by more than thirty percent (30%). For
purposes of this Employment Agreement, the term "COBRA" shall mean the
provisions of Section 4980B of the Internal Revenue Code of 1986, as amended
(the "Code"), adopted as part of the Consolidated Omnibus Budget Reconciliation
Act, which allow former employees of an employer to continue to receive health
and medical benefits, at their expense, for a specified time period. For
purposes of this Employment Agreement, the term "Continuation Period" shall mean
that time period beginning on the date your employment is terminated and ending
upon the earlier to occur of (i) eighteen (18) months after such date, (ii) the
first date on or after such date on which you commence employment with any other
employer who provides you with medical, dental and vision insurance benefits or
(iii) the first date on which you cease to be eligible under COBRA to continue
your coverage under PSI's medical, dental and vision benefit plans.

        (e)   Subject to your compliance with Section 9, in the event of a
Change of Control (as defined below) that occurs either (i) while you are
employed by PSI or (ii) within three (3) months following a Termination without
Cause, Termination for Good Reason or Termination for Death or Disability, you
will be entitled to a payment equal to three (3) times your base salary plus an
amount equal to three (3) times your target bonus, payable on the effective date
of the Change of Control. In the event of your termination by PSI or any
successor corporation for any reason following a Change of Control, you will
only be entitled to the payment set forth in this Subsection (e) (for purposes
of clarity, you will not be entitled to any additional severance payment
pursuant to Subsection (b)). Furthermore, any amounts payable pursuant to this
Subsection (e) as a result of a Change of Control that occurs within three
(3) months following a Termination without Cause, Termination for Good Reason or
Termination for Death or Disability shall be offset against any payments
previously paid pursuant to the first sentence of Subsection (b) (for purposes
of clarity, you will only be entitled to receive an aggregate of three (3) times
your base salary plus an amount equal to three (3) times your target bonus).

A "Change of Control" means:

          (i)  the consummation of a merger or consolidation of PSI with or into
another entity or any other corporate reorganization, if persons who were not
stockholders of PSI immediately prior to such merger, consolidation or other
reorganization own immediately after such merger, consolidation or other
reorganization 50% or more of the voting power of the outstanding securities of
each of (i) the continuing or surviving entity and (ii) any direct or indirect
parent corporation of such continuing or surviving entity;

         (ii)  the sale, transfer, exclusive license or other disposition of all
or substantially all of the assets of PSI;

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        (iii)  a change in the composition of the Board, as a result of which
fewer than 50% of the incumbent directors are directors who either:

        (A)  Had been directors of PSI immediately after PSI's emergence from
bankruptcy protection on August 7, 2003 or had been designated to serve on the
Board during the 90-day period after emergence pursuant to the terms of the
confirmed plan of reorganization (the "Original Directors"); or

        (B)  Were appointed to the Board, or nominated for election to the
Board, with the affirmative votes of at least a majority of the aggregate of
(A) the Original Directors who were in office at the time of their appointment
or nomination and (B) the directors whose appointment or nomination was
previously approved in a manner consistent with this Paragraph (ii);

        (iv)  Any transaction as a result of which any person (excluding any
person who was a stockholder of PSI immediately after emergence from bankruptcy
protection on August 7, 2003) is the "beneficial owner" (as defined in
Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of securities of PSI representing at least 35% of the total voting
power represented by PSI's then outstanding voting securities. For purposes of
this Subsection (d), the term "person" shall have the same meaning as when used
in sections 13(d) and 14(d) of such Act but shall exclude (i) a trustee or other
fiduciary holding securities under an employee benefit plan of PSI or of a
parent or subsidiary of PSI and (ii) a corporation owned directly or indirectly
by the stockholders of PSI in substantially the same proportions as their
ownership of the common stock of PSI; or

        (iv)  Approval by the stockholders of PSI of a complete liquidation or
dissolution of PSI.

        8.    280G PAYMENT.    

        (a)   In the event any of the benefits provided for in this Agreement or
any other benefits approved at any time by the Board or the Compensation
Committee of the Board and otherwise payable to you (including stock options)
constitute "parachute payments" within the meaning of Section 280G of the Code,
and will be subject to the excise tax imposed by Section 4999 of the Code, then,
subject to the provisions of Section 8(d) below, you shall receive from PSI
(A) a cash payment sufficient to pay such excise tax, and (B) an additional
payment sufficient to pay the excise tax and federal and state income and
employment taxes arising from the payments made by PSI to you pursuant to this
sentence.

        (b)   Unless PSI and you otherwise agree in writing, the determination
of your excise tax liability and the amount required to be paid to you by PSI
under this Section 8 shall be made in writing by PSI's independent accountants
(the "Accountants"), and the amounts to be paid to you by PSI under this
Section 8 will be paid to you within thirty (30) days after the Accountants have
finally determined that amount as provided herein (or such shorter time after
the Accountants have finally determined that amount as may be necessary in order
for you to timely pay any withholding or estimated tax obligations arising from
your receipt of any payment under this Section 8). For purposes of making the
calculations required by this Section 8, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of Sections
280G and 4999 of the Code. PSI and you shall furnish to the Accountants such
information and documents as the Accountants may reasonably request in order to
make a determination under this Section 8. PSI shall bear all costs the
Accountants may reasonably incur in connection with any calculations
contemplated by this Section 8.

        (c)   In the event that the Internal Revenue Service ("IRS") determines
that the amount of excise tax payable by you as described above in this
Section 8 is different than the amount of such

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excise tax as determined by the Accountants as provided above, then: (A) if the
amount of such excise tax payable by you as determined by the IRS is less than
the amount of such excise tax as computed by the Accountants, you will reimburse
PSI for all excess amounts actually paid to you by PSI under this Section 8 due
to the over-calculation of such excise tax by the Accountants within five
(5) business days after you receive either a refund from the IRS due to such
over-calculation or you receive an economic benefit from the IRS (such as a
credit against tax payable) on account of such over-calculation, provided you
reported and paid all your excise and income tax liabilities resulting from the
operation of this Section 8 consistent with the amounts you were actually paid
hereunder; and (B) if the amount of such excise tax payable by you as determined
by the IRS is greater than the amount of such excise tax as computed by the
Accountants, then PSI will promptly reimburse you for the amounts that PSI
underpaid you under this Section 8 due to the under-calculation of such excise
tax by the Accountants.

        (d)   In the event any of the benefits provided for in this Agreement or
any other benefits approved at any time by the Board or the Compensation
Committee of the Board and otherwise payable to you (including stock options)
constitute "parachute payments" within the meaning of Section 280G of the Code
and will be subject to the excise tax imposed by Section 4999 of the Code, then
you may, at your sole option and discretion, elect to waive, not receive and/or
reduce such benefits to such lesser extent as will result in no portion of such
benefits being subject to the excise tax imposed by Section 4999 of the Code,
and in that case PSI's obligation to make a payment to you pursuant to the
provisions of Section 8 will be correspondingly reduced.

        9.    RELEASE.    You agree that the severance payments you may be
entitled to upon Termination without Cause or Termination for Good Reason or the
payments you may be entitled to upon a Change of Control will not apply unless
(i) you and PSI have each executed a mutual general release (in a form
determined by PSI) of all known and unknown claims that either you or PSI may
then have against the other and/or persons or entities affiliated with you or
PSI, as applicable, other than payments by PSI under the Employment Agreement,
the Options, the Restricted Stock Agreement or the PSU Agreement to the extent
such payments are required to be performed after the date of the release,
(ii) you and PSI have agreed not to prosecute or bring any legal action or other
proceeding based upon any of such claims and (iii) you have agreed to provide
reasonable transition assistance to PSI (or the surviving corporation) as
requested and without further compensation for three (3) months following the
termination of employment. Notwithstanding anything in this Employment Agreement
to the contrary, in no event shall the payments provided for in Sections 7(b)
and 7(e) of this Employment Agreement that are otherwise due and payable be
delayed as a result of PSI's request that you perform Transition Services.

        10.    CONFIDENTIALITY; NONSOLICITATION.    In light of the fact that
the confidential information that you have acquired, and will acquire, is
inextricably bound with your knowledge regarding the conduct of PSI's business
activities and that therefore you would necessarily use confidential information
if you were to compete with PSI, you agree that during the Employment Term, and
for a period of one year thereafter, you will not provide any services, whether
as an officer, director, proprietor, employee, partner, consultant, advisor,
agent, sales representative or otherwise, nor will you own beneficially
securities of any of the following entities: Altiris; BMC Software, Inc.;
Computer Associates; Hewlett Packard Company; International Business Machines
Corporation; MRO Software; and USU Software AG (each a "Competitor") (except
that, in the case of any Competitor whose equity securities are publicly-held,
you may beneficially own up to 2% of the outstanding equity securities of such
Competitor or any mutual fund holding securities of such Competitor). You
further agree that in light of the nature of PSI's business, and the life-cycle
of product development, the one-year period provided for above shall apply
regardless of the nature or reason for your termination and that it is
reasonable and necessary in order to protect the confidential, proprietary and
trade-secret information that you will acquire as a result of being the
President and Chief Executive Officer of PSI. Notwithstanding the foregoing,
such restrictions shall not preclude you from providing any services to a

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distinct business unit of a Competitor if such unit does not compete with PSI's
business activities. You also, further and independently, agree that during your
employment with PSI, and for a period of one (1) year after termination of your
employment with PSI, you will not for any reason, whether directly or
indirectly: (a) solicit, recruit, take away or attempt to take away, any
employee or consultant of PSI or any of its affiliates, or induce (or attempt to
induce) any employee or consultant of PSI or any of its affiliates to terminate
his or its employment or services with PSI or any of PSI's affiliates; or
(b) use any confidential or proprietary information of PSI or any of its
affiliates to, directly or indirectly, solicit any customer of PSI or any of its
affiliates or induce any customer of PSI or its affiliates to terminate its
relationship with PSI or any PSI affiliate; provided, however, that this
non-solicitation provision shall not prevent you from hiring any employee or
consultant of PSI or any of its affiliates that you can demonstrate either
(i) approached you independently without any prior direct or indirect
solicitation or encouragement by you or on your part, or (ii) replied to a
solicitation made to the general public without any direct or indirect
solicitation or encouragement by you or on your part.

        11.    GOVERNING LAW.    This Employment Agreement will be governed by
the internal laws of the State of California without reference to its conflict
of laws provisions.

        12.    VENUE; SERVICE OF PROCESS.    Any legal action, arbitration or
other legal proceeding relating to this Employment Agreement or the enforcement
of any provision of this Employment Agreement may be brought or otherwise
commenced in any state or federal court located in the County of San Diego,
California. Each party to this Employment Agreement: (i) expressly and
irrevocably consents and submits to the jurisdiction of each state and federal
court located in the County of San Diego, California (and each appellate court
located in the State of California) in connection with any such legal proceeding
or arbitration; (ii) agrees that each state and federal court located in the
County of San Diego, California shall be deemed to be a convenient forum; and
(iii) agrees not to assert (by way of motion, as a defense or otherwise), in any
such legal proceeding or arbitration commenced in any state of federal court
located in the County of San Diego, California, any claim that such party is not
subject personally to the jurisdiction of such court, that such legal proceeding
or arbitration has been brought in an inconvenient forum, that the venue of such
proceeding is improper or that this Employment Agreement or the subject matter
of this Employment Agreement may not be enforced in or by such court. Process in
any action or proceeding referred to in this section may be served on any party
anywhere in the world.

        13    ENTIRE AGREEMENT.    This Employment Agreement, the Restricted
Stock Agreement, your stock option agreement entered into in connection with the
Original Agreement, the PSU Agreement and your employee invention assignment and
confidentiality agreement with PSI contain the entire agreement and
understanding of the parties with respect to the subject mature hereof. Except
as provided in this Employment Agreement, no other agreements, representations
or understandings (whether oral or written and whether expressed or implied)
which are not expressly set forth in this Employment Agreement have been made or
entered into by either party with respect to the subject matter hereof.

        14.    SUCCESSORS AND ASSIGNS.    This Employment Agreement will be
binding upon you (and your successors, heirs and assigns) and any successor
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of PSI's
business and/or assets. For all purposes of this Employment Agreement, the term
"PSI" shall include any successor to PSI's business and/or asserts which becomes
bound by this Employment Agreement.

        15.    LEGAL FEES.    PSI will reimburse you for legal fees and costs up
to $40,000 that you incur in connection with the negotiation and drafting of
this Employment Agreement, the Restricted Stock Agreement and the PSU Agreement.

        We look forward to your continued contributions as part of the PSI team.

        Sincerely yours,
 
 
 
 
Chairman of the Board
By signing this letter, I am agreeing to the above:
Signature:
 
 
 
 
 
Date:
 
     

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Exhibit 10.60