EXHIBIT 10.41
February 5, 2002
 
Thracy P. Varvoglis
195 Goodhill Road
Weston, CT 06883
 
Dear Thracy:
 
On behalf of Mercator Software, I am pleased to extend you an offer of
employment as Industry Solutions Executive for Financial Services & Insurance,
reporting to Michael Wheeler, SVP for Industry Solutions and Services. As a
Mercator VP, your responsibilities shall include developing industry specific
strategies and roadmaps; overseeing the execution of our business plans in the
FS & insurance vertical; and identifying, building and deploying industry
specific solutions. In this role you will work closely with Marketing, Sales,
R&D and our Partners.
 
Your first day of employment will commence on or before March 1, 2002. Following
are details of our offer to you.
 
1.    By signing this letter, you confirm to the Company that you are under no
contractual or other legal obligations that would prohibit you from entering
employment with or performing your duties for the Company.
 
2.    Compensation and Employee Benefits.    You will be paid a starting salary
at the rate of $240,000 annually, subject to an annual compensation review each
year beginning January 1, 2003, and payable in accordance with the Company’s
standard payroll schedule. We will also offer you the opportunity to participate
in the Company’s annual incentive bonus plan, under which you will be eligible
to earn, at par, a bonus of 100% of your base salary. The bonus payout is based
upon corporate and individual contribution in meeting our objectives. The payout
range is zero to 300%. It will be payable in Q1 of following year, consistent
with when other executives at this level are paid, for which you must be an
employee at that time. As an executive, you will participate in the
company-sponsored and executive benefits that the Company makes available (e.g.,
health insurance, dental insurance, etc.).
 
3.    Options.    You will be granted 75,000 options upon joining the company
with an exercise price equal to the fair market value on the date of hire. Upon
your start date 18,750 options will vest immediately, with the remainder vesting
quarterly over a four year period.
 
Upon a change of control of Mercator, Fifty (50%) percent of your outstanding
unvested stock options will vest and become immediately exercisable. A change of
control will be defined as the Acquisition, merger, dissolution, liquidation,
consolidation or sale of all or substantially all of the assets of the company.

--------------------------------------------------------------------------------

 
The options that you acquire shall be subject to the terms and conditions of the
relevant stock option plan and stock option agreement and other related
agreements to be entered into by and between you and the Company. In the event
your employment is terminated by death or disability, options to be vested
within six (6) months of your death or disability will be vested and be
exercisable for the balance of their original term.
 
4.    Vacation.    You will be entitled to four weeks vacation, in addition to
scheduled company holidays.
 
5.    Life Insurance.    You will be entitled to receive term life insurance as
offered in our employee benefit package.
 
6.    Severance.    If you are terminated for any reason other than for cause,
you will be entitled to six months’ salary payable biweekly. In addition,
executive benefits for medical insurance and other executive perquisites will be
provided for six months or until available from another employer, whichever
occurs first. Cause means: (i) your conviction of a felony; (ii) your willful
neglect of your obligations and duties hereunder, which neglect you fail to
remedy within ten days after written demand from Mercator,; or (iii) you
willfully engage in conduct demonstrably and materially injurious to Mercator,
momentarily or otherwise, and fail to remedy such conduct within ten days after
receipt of Notice thereof from Mercator. For the purpose of this clause, no act,
or failure to act, on your part shall be deemed willful unless done, or omitted
to be done, by you in good faith and without reasonable belief that your action
or omission was in, or not opposed to, the best interests of Mercator.
 
You shall have the right to terminate your employment under this agreement by
Notice within thirty days of the concurrence of Good Reason. “Good Reason”
means, without your consent, the occurrence of the following: (i) a significant
diminution of, or the assignment to you of any duties inconsistent with your
title, status, duties or responsibilities specified in the introductory
paragraph hereof; (ii) a reduction by Mercator in your annual base salary or
target bonus; (iii) the failure of Mercator to obtain the written assumption of
this Agreement by any successor within thirty days after a merger,
consolidation, sale or a Change of Control as defined above.
 
If there is a change of control of the Company as defined in paragraph 3 herein,
and within one year following this change of control, you are constructively
terminated as defined in this agreement, Mercator, or its successor, shall pay
you twelve (12) months of base salary in accordance with the Company’s usual
payroll practices. In addition, executive benefits for medical insurance will be
provided for twelve (12) months or until available from another employer,
whichever occurs first.
 
7.    Employment Relationship.    The term of your employment with the Company
is for no specific period of time. Your employment with the Company will be “at
will,” meaning that either you or the Company may terminate your employment at
any time and for any reason, with or without cause. This is the full and
complete agreement between you and the Company on this term.
 
Although your job duties, title, compensation and benefits, as well as the
Company’s personnel policies and procedures, may change from time to time, the
“at will” nature of your employment may only be changed in an express written
agreement signed by you and the Company.
 
8.    Withholding Taxes.    All amounts of compensation referred to in this
letter are subject to reduction by the Company to meet all applicable
withholding and payroll tax requirements.

2

--------------------------------------------------------------------------------

 
9.    Conditions of Employment.    Upon joining Mercator, you will be required
to sign the enclosed Conditions of Employment agreement that includes
non-disclosure and non-compete clauses which set forth conditions relating to
the security and protection of the Company’s trade secrets. In addition, you
will be required to comply with and periodically sign a certification of
compliance with Mercator’s Insider Trading Policy.
 
10.    Entire Agreement.    This letter supersedes and replaces any prior
understandings or agreements, whether oral or written, between you and the
Company regarding the subject matter described in this letter.
 
We hope that you find the foregoing terms acceptable. You may indicate your
agreement with these terms and accept this offer by signing and dating the line
provided below and returning the executed copy to the undersigned. The terms and
conditions of this offer will expire on February 8, 2002. As required by law,
your employment with the Company is also contingent upon your providing legal
proof of your identity and authorization to work in the United States.
 
I look forward to working with you and having you as a member of the executive
team.
 
If you have any questions, please call me at (203) 563-1358.
 
Very truly yours,
MERCATOR SOFTWARE, INC.
 
/s/Greg O’Brien
 
Greg O’Brien
SVP Human Resources
 
I have read and accept this employment offer:
 
/s/    Thracy Varvoglis
 
Date:
 
2/8/02

--------------------------------------------------------------------------------

     

--------------------------------------------------------------------------------

Signature of Thracy Varvoglis
       

3