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                                                                 EXHIBIT 10.12.1

                         EXECUTIVE EMPLOYMENT AGREEMENT

         EMPLOYMENT AGREEMENT made as of October 1, 1999 by and between Exult
(the "Company"), and Stephen M. Unterberger ("Executive").

         1. DUTIES AND RESPONSIBILITIES.

         A. Executive shall serve as the Company's Vice President and Chief
Operating Officer and shall report to and perform the duties and
responsibilities assigned to you by the Company's Chief Executive Officer, or
such other person as may be designated by the Company's Chief Executive Officer.

         B. Executive agrees to devote his full time and attention to the
Company, to use his best efforts to advance the business and welfare of the
Company, to render his services under this Agreement fully, faithfully,
diligently, competently and to the best of his ability, and not to engage in any
other employment activities.

         C. Executive shall be based at the Company's office located at the
Corporate Headquarters at 4 Park Plaza, Suite 350, Irvine, California, but
Executive shall be required to travel to other geographic locations in
connection with the performance of his executive duties.

         2. PERIOD OF EMPLOYMENT. Executive's employment with the Company shall
be governed by the provisions of this Agreement for the period commencing
October 1, 1999 and continuing until this Agreement terminates pursuant to
written notice by either the Company or Executive. The period during which
Executive's employment continues in effect shall be hereafter referred to as the
"Employment Period."

         3. CASH COMPENSATION.

         A. Effective January 1, 2000, Executive's initial base salary shall be
$285,000 per year payable in accordance with the Company's standard payroll
schedule. Executive's base salary shall be subject to annual review by the
Company, and may be increased or decreased in the Company's discretion. Prior to
January 1, 2000, Executive's base salary shall remain at its current level of
$350,000, and Executive shall not be eligible for additional bonus payment.

         B. For each fiscal year during the Employment Period, Executive shall
be eligible for a bonus. Your annual incentive target will be 50% of your base
salary, prorated for the portion of the fiscal year worked. The bonus amount
will be based on the financial performance of the Company as determined and
measured by the Company's Board of Directors and Chief Executive Officer. The
bonus amount is intended to reward contribution to the Company's performance
over an entire fiscal year, and consequently will be paid only if Executive is
employed and in good standing at the time of bonus payments, which generally
occurs within 45 days after the close of the Company's fiscal year. Bonus
determinations will be made in the Company's sole discretion.


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         C. The Company shall deduct and withhold from the compensation payable
to Executive hereunder any and all applicable Federal, State and local income
and employment withholding taxes and any other amounts required to be deducted
or withheld by the Company under applicable statutes, regulations, ordinances or
orders governing or requiring the withholding or deduction of amounts otherwise
payable as compensation or wages to employees.

         4. EQUITY COMPENSATION. Pursuant and subject to the terms and
conditions of the Company's stock option plan, the Company will grant Executive
options which will vest over time. The option price will be established as of
the date the Company's Board of Directors grants such options pursuant to the
Company's stock option plan and in an amount determined by the Company's Board
of Directors in its sole discretion.

         5. EXPENSE REIMBURSEMENT. In addition to the compensation specified in
Paragraph 3, Executive shall be entitled, in accordance with the reimbursement
policies in effect from time to time, to receive reimbursement from the Company
for reasonable business expenses incurred by Executive in the performance of his
duties hereunder, provided Executive furnishes the Company with vouchers,
receipts and other details of such expenses in the form required by the Company
sufficient to substantiate a deduction for such business expenses under all
applicable rules and regulations of federal and state taxing authorities.

         6. FRINGE BENEFITS.

         A. Executive shall, throughout the Employment Period, be eligible to
participate in all executive life and disability insurance programs, group term
life insurance plans, group health plans, accidental death and dismemberment
plans and disability programs and other executive perquisites which are made
available to the Company's executives and for which Executive qualifies.

         B. Executive shall earn vacation time during the Employment Period at
the rate of four (4) weeks per year. Vacation shall accrue and be taken pursuant
to the Company's vacation benefit policy set forth in the Company's Employee
Handbook.

         7. MOVING EXPENSES. The Company will advance Executive up to the
maximum as specified in the Company's relocation policy for reasonable expenses
incurred by Executive in a relocation requested by the Company. The Company's
complete policy on moving expenses can be obtained from the Company's Human
Resources Department. The moving expense advance will be forgiven by the Company
at the rate of one-eighteenth (1/18) of the advanced amount each month Executive
remains employed by the Company. Should Executive terminate his employment prior
to full repayment of the advanced amount, amounts which remain outstanding will
be deducted from Executives final paychecks for unpaid wages and accrued but
unused vacation.

         8. EMPLOYMENT AT WILL. Executive's employment with the Company is at
will and not for a specific term and may be terminated by either the Company or
Executive at any time, for any reason without notice. Similarly the Company may
change the terms and conditions of Executives employment at any time for any
reason. Should the Company terminate Executive's employment, the Company shall
have no obligation to Executive under


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this Agreement other than for payment of accrued but unpaid wages and accrued
but unused vacation. Executive may, however, be entitled to severance benefits
in accordance with the Company's Executive Severance Plan. A summary of the
Company's Executive Severance Plan will be provided to Executive.

         Should the Company terminate Executive's employment for cause, as
defined in the following paragraph, the Company shall have no further obligation
to Executive under this Agreement other than for accrued but unpaid salary and
vacation as of the date of termination. For purposes of this Agreement, "cause"
shall mean a reasonable belief that Executive has engaged in any one of the
following: (i) financial dishonesty, including, without limitation,
misappropriation of funds or property, or any attempt by Executive to secure any
personal profit related to the business or business opportunities of the Company
without the informed, written approval of the Company's Board of Directors; (ii)
refusal to comply with reasonable directives of the Company's Chief Executive
Officer or Board of Directors; (iii) gross negligence or reckless or willful
misconduct in the performance of Executive's duties; (iv) failure to perform, or
continuing neglect in the performance of, duties assigned to Executive; (v)
intentional misconduct which has a materially adverse effect upon the Company's
business or reputation; (vi) the conviction of, or plea of nolo contendre to, or
an misdemeanor involving moral turpitude or fraud; (vii) the material breach of
any provision of this agreement; of (viii) violation of Company policies
including, without limitation, the Company's policies on equal employment
opportunity and prohibition of unlawful harassment.

         Notwithstanding the aforementioned paragraphs in this section 8, should
the Company terminate the Executive's employment for reasons other then cause,
the Executive will be entitled to severance in the greater amount of the
Company's current Executive Severance Policy or as specified below:

         (a) In the event the Company terminates your employment other than for
             Cause, the Executive will be entitled to receive one year's annual
             salary and bonus.

         (b) Within 18 months of a change in control of the Company, if the
             Executive is assigned a level of responsibility or duties not
             commensurate with your current level and duties; or your salary or
             bonus target is reduced; or your primary location of work is
             greater then 50 miles from Irvine, CA, you will be entitled to one
             year's salary and bonus in the event you terminate your employment
             with the Company.

         (c) In the event of your death, this letter agreement will terminate
             and the Company shall have no obligations hereunder, except that
             your legal representatives shall be entitled to receive six months
             of your annual salary, payable in equal installments in accordance
             with Company's standard payroll schedule (subject to all applicable
             withholdings required by law).

         (d) If during the Term you become physically or mentally disabled,
             whether totally or partially, as evidenced by a written statement
             of a competent physician licensed to practice medicine in the
             United States who is mutually acceptable to Company and you (or
             your legal representative if you are not


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             then able to make such a choice), so that you are unable
             substantially to perform your obligations under this letter
             agreement for (i) a period of two consecutive months or (ii) for
             shorter periods aggregating to two months during any one year, the
             Company may, without any liability under this letter agreement and
             by written notice to you, at any time after the last day of the
             consecutive two months of disability or the day on which the
             shorter periods of disability equal an aggregate of two months,
             suspend the Term provided that you shall be entitled to receive
             your annual salary, paid in accordance with the Company's regular
             payroll schedule for a period six months. The company may then
             discontinue payments of your annual salary for the duration of the
             disability, provided that you will be entitled to your annual
             salary in accordance with Section 2 above for periods of disability
             shorter than the periods specified in clauses (i) and (ii) above.

         (e) Notwithstanding anything to the contrary set forth in this letter
             agreement, (i) in the event that you terminate your employment with
             Company or Company terminates your employment with Company, in each
             case for any reason or no reason, or (ii) upon the expiration of
             the Term, your obligations under Section 9 below shall continue and
             survive such termination or expiration.

         9. RESTRICTIVE COVENANTS. During the Employment Period:

            (i)    Executive shall devote Executive's full time and energy
                   solely and exclusively to the performance of Executive's
                   duties described herein, except during periods of illness or
                   vacation periods.

            (ii)   Executive shall not directly or indirectly provide services
                   to or through any person, firm or other entity except the
                   Company, unless otherwise authorized by the Board in writing.

            (iii)  Executive shall not render any services of any kind or
                   character for Executive's own account or for any other
                   person, firm or entity without first obtaining the Company's
                   written consent.

Executive, however, shall have the right to perform such incidental services as
are necessary in connection with (a) Executive's private passive investments,
but only if Executive is not obligated or required to (and shall not in fact)
devote any managerial efforts which interfere with the services required to be
performed by him, or (b) Executive's charitable or community activities, or
participation in trade or professional organizations, but only if such
incidental services do not interfere with the performance of Executive's
services to the company.

         10. NON-COMPETITION. Executive acknowledges and agrees that given the
extent and nature of the confidential and proprietary information he will obtain
during the course of his employment with the Company, it would be inevitable
that such confidential information would be disclosed or utilized by the
Executive should he obtain employment from, or otherwise become associated with,
an entity or person that is engaged in a business or enterprise that


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directly competes with the Company. Consequently, during any period for which
Executive is receiving payments from the Company, either as wages or as a
severance Executive shall not, without prior written consent of the Company's
Board of Directors, directly or indirectly own, manage, operate, join, control
or participate in the ownership, management, operation or control of, or be
employed by or connected in any manner with, any enterprise which is engaged in
any business competitive with or similar to that of the Company; provided,
however, that such restriction shall not apply to any passive investment
representing an interest of less than two percent (2%) of an outstanding class
of publicly-traded securities of any company or other enterprise which is not,
at the time of such investment, engaged in a business competitive with the
Company's business.

         11. NON-SOLICITATION. During the Employment Period and for one (1) year
following termination of Executive's employment, Executive shall not encourage
or solicit any of the Company's employees to leave the Company's employ for any
reason or interfere in any other manner with employment relationships at the
time existing between the Company and its employees; or solicit any client of
the Company, induce any of the Company's clients to terminate its existing
business relationship with the Company or interfere in any other manner with any
existing business relationship between the Company and any client or other third
party.

         Executive hereby acknowledges that monetary damages may not be
sufficient to compensate the Company for any economic loss which may be incurred
by reason of her breach of the foregoing restrictive covenants. Accordingly, in
the event of any such breach, the Company shall, in addition to the termination
of this Agreement and any remedies available to the Company at law, be entitled
to obtain equitable relief in the form of an injunction precluding Executive
from continuing such breach.

         12. PROPRIETARY INFORMATION. As a condition precedent to Executive's
employment with the Company, Executive will execute the Company's standard
Confidential Information and Assignment of Inventions Agreement. Executive's
obligations pursuant to the Confidential Information and Assignment of
Inventions Agreement will survive termination of Executive's employment with the
Company.

         13. SUCCESSORS AND ASSIGNS. This Agreement is personal in its nature
and the Executive shall not assign or transfer his rights under this Agreement.
The provisions of this Agreement shall inure to the benefit of, and be binding
on each successor of the Company whether by merger, consolidation, transfer of
all or substantially all assets, or otherwise and the heirs and legal
representatives of Executive.

         14. NOTICES. Any notices, demands or other communications required or
desired to be given by any party shall be in writing and shall be validly given
to another party if served either personally or if deposited in the United
States mail, certified or registered, postage prepaid, return receipt requested.
If such notice, demand or other communication shall be served personally,
service shall be conclusively deemed made at the time of such personal service.
If such notice, demand or other communication is given by mail, such notice
shall be conclusively deemed given forty-eight (48) hours after the deposit
thereof in the United States mail addressed to the party to whom such notice,
demand or other communication is to be given as hereinafter set forth:

         To the Company: Exult, Inc.
                         4 Park Plaza, Suite 350
                         Irvine, California  92614

         To Executive:   Stephen M. Unterberger
                         939 Emerald Bay
                         Laguna Beach, California  92651


Any party may change its address for the purpose of receiving notices, demands
and other communications by providing written notice to the other party in the
manner described in this paragraph.


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         15. GOVERNING DOCUMENTS. This Agreement along with the Company's
Proprietary Information and Assignment of Inventions Agreement constitute the
entire agreement and understanding of the Company and Executive with respect to
the terms and conditions of Executive's employment with the Company and the
payment of severance benefits and supersedes all prior and contemporaneous
written or verbal agreements and understandings between Executive and the
Company relating to such subject matter. This Agreement may only be amended by
written instrument signed by Executive and an authorized officer of the Company.
Any and all prior agreements, understandings or representations relating to the
Executive's employment with the Company are terminated and cancelled in their
entirety and are of no further force or effect.

         16. GOVERNING LAW. The provisions of this letter agreement will be
construed and interpreted under the laws of the State of California applicable
to agreements executed and to be wholly performed within the State of
California. If any provision of this Agreement as applied to any party or to any
circumstance should be adjudged by a court of competent jurisdiction to be void
or unenforceable for any reason, the invalidity of that provision shall in no
way affect (to the maximum extent permissible by law) the application of such
provision under circumstances different from those adjudicated by the court, the
application of any other provision of this Agreement, or the enforceability or
invalidity of this Agreement as a whole. Should any provision of this Agreement
become or be deemed invalid, illegal or unenforceable in any jurisdiction by
reason of the scope, extent or duration of its coverage, then such provision
shall be deemed amended to the extent necessary to conform to applicable law so
as to be valid and enforceable or, if such provision cannot be so amended
without materially altering the intention of the parties, then such provision
will be stricken and the remainder of this Agreement shall continue in full
force and effect.

         17. REMEDIES. All rights and remedies provided pursuant to this
Agreement or by law shall be cumulative, and no such right or remedy shall be
exclusive of any other. A party may pursue any one or more rights or remedies
hereunder or may seek damages or specific performance in the event of another
party's breach hereunder or may pursue any other remedy by law or equity,
whether or not stated in this Agreement.

         18. ARBITRATION. Any and all disputes between Executive and the Company
which arise out of Executive's employment under the terms of this Agreement
shall be resolved


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through final and binding arbitration. This shall include, without limitation,
disputes relating to this Agreement, Executive's employment by the Company or
the termination thereof, claims for breach of contract or breach of the covenant
of good faith and fair dealing, and any claims of discrimination or other claims
under Title VII of the Civil Rights Act of 1964, the Age Discrimination in
Employment Act, the Americans With Disabilities Act, the California Fair
Employment and Housing Act, or any other federal, state or local law or
regulation now in existence or hereinafter enacted and as amended from time to
time concerning in any way the subject of Executive's employment with the
Company or its termination. The only claims not covered by this Agreement are
claims for benefits under the workers' compensation or unemployment insurance
laws, which will be resolved pursuant to those laws. Binding arbitration will be
conducted in Orange County, California in accordance with the rules and
regulations of the American Arbitration Association. Each party will split the
cost of the arbitration filing and hearing fees, and the cost of the arbitrator;
each side will bear its own attorneys' fees, that is, the arbitrator will not
have authority to award attorneys' fees unless a statutory section at issue in
the dispute authorizes the award of attorneys' fees to the prevailing party, in
which case the arbitrator has authority to make such award as permitted by the
statute in question. Executive understands and agrees that the arbitration shall
be instead of any civil litigation and that this means that she is waiving her
right to a jury trial as to such claims. The parties further understand and
agree that the arbitrator's decision shall be final and binding to the fullest
extent permitted by law and enforceable by any court having jurisdiction.

         19. NO WAIVER. The waiver by either party of a breach of any provision
of this Agreement shall not operate as or be construed as a waiver of any later
breach of that provision.

         20. COUNTERPARTS. This Agreement may be executed in more than one
counterpart, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.

                                         EXULT, INC.
                                         /s/ JAMES C. MADDEN, V
                                         ------------------------------------
                                         By: James C. Madden, V
                                         Title: President & CEO

                                         /s/ STEPHEN M. UNTERBERGER
                                         ------------------------------------
                                         EXECUTIVE


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