Exhibit 10.5

March 8, 2006

George de Urioste

Chordiant Software, Inc.

20400 Stevens Creek Blvd., Suite 400

Cupertino, CA 95014

Dear George:

This letter sets forth the terms of the separation agreement (the “Agreement”)
that Chordiant Software, Inc. (the “Company”) is offering to you to aid in your
employment transition.

1. Separation Date. As of today, you hereby resign from any officer or director
positions that you hold with the Company and/or any of its subsidiaries
(including your positions as Chief Financial Officer and Chief Operating
Officer), and the Company hereby accepts such resignations. Between today and
March 31, 2006 (the “Separation Date”), you will remain an employee of the
Company. You will have access to the Company’s email and voicemail systems, but
will not have an office at the Company’s facilities after March 10, 2006.

2. Accrued Salary and Vacation Pay. On the Separation Date, the Company will pay
you all accrued salary and all accrued and unused vacation (if any) earned by
you through the Separation Date, less standard payroll deductions and
withholdings. You are entitled to these payments by law.

3. Severance Benefits. If you sign the Separation Date Release attached hereto
as Exhibit A on the Separation Date, and allow that release to become effective,
then the Company will make a lump-sum severance payment to you in an amount
equal to five (5) months of your base salary, less standard payroll deductions
and withholdings. This amount shall be paid within five (5) days after the
Separation Date Release Effective Date (as defined in Exhibit A).

4. Health Insurance. You will continue to receive health insurance benefits
under the Company’s group plans, as currently enrolled, through the Separation
Date. After this date, and to the extent provided by the federal COBRA law or,
if applicable, state insurance laws, and by the Company’s current group health
insurance policies, you will be eligible to continue your group health insurance
benefits at your own expense. Later, you may be able to convert to an individual
policy through the provider of the Company’s health insurance, if you wish. You
will be provided with a separate notice describing your rights and obligations
under the applicable state and/or federal insurance laws. As an additional
severance benefit, if you sign the Separation Date Release and allow that
release to become effective, then the Company will, for five (5) months after
the Separation Date, reimburse you for premium payments sufficient to continue
your group health insurance coverage at the level in effect as of the Separation
Date (including dependent coverage, if any); provided, however, that your right
to such payments shall cease on the date that you become eligible for group
health insurance benefits through a new employer. You agree to promptly notify
the Company’s Chief Executive Officer in writing if you become eligible for
group health insurance coverage through a new employer during the reimbursement
period.

 

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5. Equity. Pursuant to the terms of the governing documents, your Company stock
options will cease vesting as of the Separation Date. Your rights to exercise
any vested option shares shall be governed by the terms and conditions of the
applicable option agreements and plan documents.

6. No Other Compensation or Benefits. You acknowledge that, except as expressly
provided in this Agreement, you have not earned and will not receive from the
Company any additional compensation, severance, or benefits relating to or
arising from your employment with the Company, after the Separation Date, with
the exception of any vested right you may have under the express terms of a
written ERISA-qualified benefit plan (e.g., 401(k) account). By way of example,
you acknowledge that you are not owed any bonus, incentive compensation, or
commissions, except as may be expressly provided herein.

7. Expense Reimbursement. You agree that, within thirty (30) days after the
Separation Date, you will submit your final documented expense reimbursement
statement reflecting all business expenses you incurred through the Separation
Date, for which you seek reimbursement. The Company will reimburse you for such
expenses pursuant to its regular business practice.

8. Return of Company Property. You agree to fulfill your obligation to
immediately return to the Company all Company documents (and all copies thereof)
and other Company property in your possession or control, including, but not
limited to, Company files, notes, correspondence, memoranda, notebooks,
drawings, records, reports, lists, compilations of data, proposals, agreements,
drafts, minutes, studies, plans, forecasts, purchase orders, business cards and
stationery, financial and operational information, technical and training
information, research and development information, customer information and
contact lists, sales and marketing information, personnel information, vendor
information, promotional literature and instructions, product and manufacturing
information, computer-recorded information, electronic information (including
e-mail and correspondence), other tangible property and equipment (including,
but not limited to, computer equipment, facsimile machines, and cellular
telephones), credit cards, entry cards, identification badges and keys; and any
materials of any kind that contain or embody any proprietary or confidential
information of the Company (and all reproductions thereof in whole or in part).
You agree that you will immediately make a diligent search to locate any such
documents, property and information. In addition, if you have used any personal
computer, server, or e-mail system to receive, store, prepare or transmit any
Company confidential or proprietary data, materials or information, you agree to
immediately provide the Company with a computer-useable copy of all such
information and then permanently delete and expunge such Company confidential or
proprietary information from those systems; and you agree to provide the Company
access to your system as reasonably requested to verify that the necessary
copying and/or deletion is completed. Your timely return of all such Company
documents and other property is a precondition to your receipt of the severance
benefits provided under this Agreement.

 

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9. Proprietary Information Obligations. You acknowledge your continuing
obligations under your Proprietary Information and Inventions Agreement (the
“Proprietary Information Agreement”), a copy of which is attached hereto as
Exhibit B.

10. Nondisparagement. You agree not to disparage the Company and its officers,
directors, employees, shareholders and agents, in any manner likely to be
harmful to them or their business, business reputation or personal reputation;
and the Company (through its officers and directors) agrees not to disparage you
in any manner likely to be harmful to you or your business, business reputation
or personal reputation; provided that you and the Company may respond accurately
and fully to any inquiry or request for information when required by legal
process.

11. No Voluntary Adverse Action. You agree that you will not voluntarily (except
in response to legal compulsion) assist any third party in bringing or pursuing
any proposed or pending litigation, arbitration, administrative claim or other
formal proceeding against the Company, its parent or subsidiary entities,
affiliates, officers, directors, employees or agents.

12. Cooperation. You agree to cooperate fully with the Company in connection
with its actual or contemplated defense, prosecution, or investigation of any
claims or demands by or against third parties, or other matters, arising from
events, acts, or failures to act that occurred during the period of your
employment by the Company. Such cooperation includes, without limitation, making
yourself available to the Company upon reasonable notice, without subpoena, to
provide complete, truthful, and accurate information in witness interviews and
deposition and trial testimony. The Company will reimburse you for reasonable
out-of-pocket expenses you incur in connection with any such cooperation
(excluding forgone wages or other compensation) and will make reasonable efforts
to accommodate your scheduling needs. In addition, you agree to execute all
documents (if any) necessary to carry out the terms of this Agreement.

13. No Admissions. Nothing contained in this Agreement shall be construed as an
admission by you or the Company of any liability, obligation, wrongdoing or
violation of law.

14. Release of Claims. In exchange for the consideration under this Agreement to
which you would not otherwise be entitled, you hereby generally and completely
release, acquit and forever discharge the Company and its parent or subsidiary
entities, successors, predecessors and affiliates, and its and their directors,
officers, employees, shareholders, agents, attorneys, insurers, affiliates and
assigns, from any and all claims, liabilities and obligations, both known and
unknown, that arise from or are in any way related to events, acts, conduct, or
omissions occurring at any time prior to and including the date you sign this
Agreement. This general release includes, but is not limited to: (a) all claims
arising out of or in any way related to your employment with the Company or the
termination of that employment; (b) all claims related to your compensation or
benefits from the Company, including salary, bonuses, commissions, vacation pay,
expense reimbursements, severance payments, fringe benefits, stock, stock
options, or any other ownership or equity interests in the Company; (c) all
claims for breach of contract, wrongful termination, and breach of the implied
covenant of good faith and fair dealing; (d) all tort claims, including but not
limited to claims for fraud, defamation, emotional distress, and discharge in
violation of public policy; and (e) all federal, state, and local statutory
claims, including but not limited to claims for discrimination, harassment,
retaliation, attorneys’ fees, or

 

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other claims arising under the federal Civil Rights Act of 1964 (as amended),
the federal Americans with Disabilities Act of 1990 (as amended), the federal
Age Discrimination in Employment Act of 1967 (as amended) (the “ADEA”), the
California Labor Code, and the California Fair Employment and Housing Act.
Notwithstanding the foregoing, you are not hereby releasing the Company from any
obligation it may otherwise have to indemnify you for your acts within the
course and scope of your employment with the Company, pursuant to the articles
and bylaws of the Company, any fully executed written agreement with the
Company, or applicable law. You represent that you have no lawsuits, claims or
actions pending in your name, or on behalf of any other person or entity,
against the Company or any other person or entity subject to the release granted
in this paragraph. In addition, you covenant not to sue, initiate, or continue
any legal or administrative proceeding with regard to any or all claims you have
released herein.

15. ADEA WAIVER. You hereby acknowledge that you are knowingly and voluntarily
waiving and releasing any rights you may have under the ADEA and that the
consideration given for the waiver and release in the preceding paragraph is in
addition to anything of value to which you were already entitled. You further
acknowledge that you have been advised by this writing, as required by the ADEA,
that: (a) your waiver and release do not apply to any rights or claims that may
arise after you sign this Agreement; (b) you should consult with an attorney
prior to executing this Agreement (although you may voluntarily decide not to do
so); (c) you have twenty-one (21) days within which to consider this Agreement
(although you may choose to voluntarily execute this Agreement earlier); (d) you
have seven (7) days following the execution of this Agreement to revoke this
Agreement (in a written revocation sent to the Company’s Chairman); and (e) this
Agreement will not be effective until the eighth day after this Agreement has
been signed both by you and by the Company.

16. Section 1542 Waiver. In giving the release set forth in this Agreement,
which includes claims which may be unknown to you at present, you acknowledge
that you have read and understand Section 1542 of the California Civil Code
which reads as follows: “A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his settlement
with the debtor.” You hereby expressly waive and relinquish all rights and
benefits under that section and any law or legal principle of similar effect in
any jurisdiction with respect to the releases granted herein, including but not
limited to the release of unknown and unsuspected claims granted in this
Agreement.

17. Miscellaneous. This Agreement constitutes the complete, final and exclusive
embodiment of the entire agreement between you and the Company with regard to
its subject matter. It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein,
and it supersedes any other such promises, warranties or representations. This
Agreement may not be modified or amended except in a writing signed by both you
and a duly authorized officer of the Company. This Agreement will bind the
heirs, personal representatives, successors and assigns of both you and the
Company, and inure to the benefit of both you and the Company, their heirs,
successors and assigns. If any provision of this Agreement is determined to be
invalid or unenforceable, in whole or in part, this determination will not
affect any other provision of this Agreement and the provision in question will
be modified so as to be rendered enforceable in a manner consistent with the
intent of the parties

 

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insofar as possible under applicable law. This Agreement shall be deemed to have
been entered into, and construed and enforced in accordance with, the laws of
the State of California without regard to conflicts of law principles. Any
ambiguity in this Agreement shall not be construed against either party as the
drafter. Any waiver of a breach of this Agreement, or rights hereunder, shall be
in writing and shall not be deemed to be a waiver of any successive breach or
rights hereunder. This Agreement may be executed in counterparts which shall be
deemed to be part of one original, and facsimile signatures will suffice as
original signatures.

If this Agreement is acceptable to you, please sign below and return the
original to me.

Sincerely,

 

CHORDIANT SOFTWARE, INC. By:  

/s/ Steven R. Springsteel

  Steven R. Springsteel   President and Chief Executive Officer

Exhibit A – Separation Date Release

Exhibit B – Proprietary Information Agreement

UNDERSTOOD AND AGREED:

 

/s/ George de Urioste

George de Urioste Date:  

 

 

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EXHIBIT A

SEPARATION DATE RELEASE

(To be signed on the Separation Date.)

In exchange for the severance benefits and other consideration provided to me by
Chordiant Software, Inc. (the “Company”), and as required by my Separation
Agreement with the Company, I hereby provide the following Separation Date
Release (the “Release”).

I hereby generally and completely release the Company and its directors,
officers, employees, shareholders, partners, agents, attorneys, predecessors,
successors, parent and subsidiary entities, insurers, affiliates, and assigns
from any and all claims, liabilities and obligations, both known and unknown,
arising out of or in any way related to events, acts, conduct, or omissions
occurring at any time prior to or at the time that I sign this Release. This
general release includes, but is not limited to: (1) all claims arising out of
or in any way related to my employment with the Company or the termination of
that employment; (2) all claims related to my compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership or equity interests in the Company; (3) all claims for breach of
contract, wrongful termination, and breach of the implied covenant of good faith
and fair dealing; (4) all tort claims, including claims for fraud, defamation,
emotional distress, and discharge in violation of public policy; and (5) all
federal, state, and local statutory claims, including claims for discrimination,
harassment, retaliation, attorneys’ fees, or other claims arising under the
federal Civil Rights Act of 1964 (as amended), the federal Americans with
Disabilities Act of 1990, the federal Age Discrimination in Employment Act (as
amended) (“ADEA”), the federal Family and Medical Leave Act, the California
Family Rights Act, the California Labor Code, and the California Fair Employment
and Housing Act (as amended). Notwithstanding the foregoing, I am not releasing
the Company hereby from any obligation to indemnify me pursuant to the articles
and bylaws of the Company, any valid fully executed indemnification agreement
with the Company, applicable law, or applicable directors and officers liability
insurance. I represent that I have no lawsuits, claims or actions pending in my
name, or on behalf of any other person or entity, against the Company or any
other person or entity subject to the release granted in this paragraph.

I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under the ADEA, and that the consideration given for the
waiver and release in the preceding paragraph is in addition to anything of
value to which I am already entitled. I further acknowledge that I have been
advised by this writing that: (a) my waiver and release do not apply to any
rights or claims that may arise after the date I sign this Release; (b) I should
consult with an attorney prior to signing this Release (although I may choose
voluntarily not to do so); (c) I have twenty-one (21) days to consider this
Release (although I may choose voluntarily to sign it earlier); (d) I have seven
(7) days following the date I sign this Release to revoke it by providing
written notice of revocation to the Company’s Chairman; and (e) this Release
will not be effective until the date upon which the revocation period has
expired, which will be the eighth calendar day after the date I sign it (the
“Separation Date Release Effective Date”).

 

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I UNDERSTAND THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN
CLAIMS. I acknowledge that I have read and understand Section 1542 of the
California Civil Code which reads as follows: “A general release does not extend
to claims which the creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him must have materially
affected his settlement with the debtor.” I hereby expressly waive and
relinquish all rights and benefits under that section and any law or legal
principle of similar effect in any jurisdiction with respect to my release of
claims herein, including but not limited to the release of unknown and
unsuspected claims.

 

By:  

 

  George de Urioste Date:  

 

 

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EXHIBIT B

Proprietary Information and Inventions Agreement

 

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