<PAGE>

                                 Exhibit 10.1

                             EMPLOYMENT AGREEMENT
                                    between
                  TENFOLD CORPORATION and DONALD R. JEFFERIS

     This Employment Agreement (the "Agreement"), is effective as of May 14,
2001 (the "Effective Date"), by and between Donald R. Jefferis ("Employee") and
TenFold Corporation, a Delaware corporation (the "Company").

     1.   TERM OF AGREEMENT.  This Agreement shall commence as of the Effective
          -----------------
Date, and shall have a term of two (2) years and one day (the "Original Term").
Subject to each party's obligations set forth below, this Agreement may be
terminated by either party, with or without cause, on thirty (30) days' written
notice to the other party. After the end of the Original Term, this Agreement
(and simultaneously Employee's employment) shall be automatically extended for
additional successive one (1) year periods unless the parties hereto mutually
agree in writing to terminate the Agreement in accordance with the terms hereof
prior to the commencement of any such one (1) year period.

     2.   DUTIES.
          ------

          a.   POSITION.  For the term of the Agreement, Employee shall be
               --------
employed as the Company's Chief Financial Officer and Senior Vice President and
will report to the Company's Chief Executive Officer.

          b.   OBLIGATIONS TO THE COMPANY.  Employee agrees that he will at all
               --------------------------
times, to the best of his ability and experience, loyally and conscientiously
perform all of the duties and obligations required of and from Employee pursuant
to the terms hereof or as directed by the Company's Chief Executive Officer.
During the term of Employee's employment relationship with the Company, Employee
further agrees that he will devote all of his business time, attention and
effort to the business of the Company and will use his reasonable best efforts
to promote the interests of the Company, and the Company will be entitled to all
of the benefits and profits arising from or incident to all such work services
and advice; provided, however, that Employee may perform and accept compensation
for personal services of an incidental nature rendered to a party other than the
Company if the performance of such services is approved by the Company's Chief
Executive Officer (such approval not to be unreasonably withheld) and does not
impair Employee's ability to perform his duties hereunder. Company acknowledges
and agrees that Employee is a member of the Board of Directors of Steel-Pro,
Incorporated, a privately held corporation, and a member of the Working Group of
Pop!Tech, a non-profit organization. The Company agrees and approves these
activities as "personal services of an incidental nature" within the meaning of
the preceding paragraph.

          c.   MANNER AND LOCATION OF WORK.  The Company acknowledges and agrees
               ----------------------------
that Employee's primary residence is located in Rockport, Maine and that
Employee works primarily from the Company office in Camden, Maine. The Company
will endeavor to make reasonable demands on Employee's travel schedule.

     3.   AT-WILL EMPLOYMENT.  The Company and Employee acknowledge that
          ------------------
Employee's employment is and shall continue to be at-will, as defined under
applicable law.  If Employee's employment terminates for any reason, Employee
shall not be entitled to any payments,
<PAGE>

benefits, damages, award or compensation other than as provided in this
Agreement, or any enhanced compensation or benefit, except as may otherwise be
available under the Company's established written plans and written policies at
the time of termination under such plans' general terms; provided, however, that
any severance benefit due Employee shall be only as set forth in this Agreement.

     4.   COMPENSATION.  For the duties and services to be performed by Employee
          ------------
hereunder, the Company shall pay Employee, and Employee agrees to accept, the
base salary, stock options, bonuses and other benefits described below in this
Section 4.

          a.   SALARY.  Employee shall receive a base monthly salary of $25,000
               ------
which is equivalent to $300,000 on an annualized basis (the "Base Salary").
Employee's Base Salary will be payable in equal payments per month pursuant to
the Company's normal payroll practices. The Base Salary shall be reviewed from
time to time by the Company's Chief Executive Officer and the compensation
committee of the Company's board of directors (hereinafter "Compensation
Committee") and any change will be effective as of the date determined
appropriate by the Company's Chief Executive Officer and the Compensation
Committee. Effective as of the date of any such change, the Base Salary as
changed shall be considered the new Base Salary for purposes of this Agreement.

          b.   STOCK OPTIONS AND OTHER INCENTIVE PROGRAMS.  Employee shall be
               ------------------------------------------
eligible to participate in the Company's Stock Option Plan, Employee Stock
Purchase Plan, and any other incentive programs available to officers or
employees of the Company.  The Company's Chief Executive Officer shall, within
five (5) days of the execution of this Agreement, recommend to the Company's
board of directors and the Compensation Committee that Employee be awarded an
option to purchase seven hundred fifty thousand (750,000) shares (as adjusted
for any stock split or similar event) of the Company's common stock on the date
this Agreement is approved by the Company's board of directors and the
Compensation Committee, which approval shall be sought by written consent as
soon as practical (expected to occur within five (5) business days of the
Company's Chief Executive Officer recommendation).  Such option shall provide
for an exercise price equal to the stock's fair market value on the grant date,
and shall first become exercisable to the extent of 150,000 shares on December
28, 2001, then another 37,500 shares after the end of each three-month period
commencing on January 1, 2002, until the all of the shares under the option
shall be fully exercisable; provided, however, that if, prior to any portion of
such option becoming exercisable, the Company's market capitalization exceeds
$500,000,000 for twenty (20) consecutive trading days, then 150,000 shares shall
become fully exercisable; and provided, further, that in the event of a Change
of Control (i) 150,000 shares of such option shall become fully exercisable five
(5) days before a Change in Control that occurs on or before one year after the
Effective Date and (ii) the terms of Section 14 of  the Company's 1999 Stock
Plan shall apply. Options previously granted Employee by the Company shall
remain in full force and effect. The Company's Chief Executive Officer will
recommend to the Company's board of directors that the Company allow Employee to
terminate all or any part of vested or unvested options to purchase the
Company's common stock received prior to the date of this Agreement and to
receive an option grant to purchase the Company's common stock on a one-for-one
basis (as adjusted for any splits or similar event), pursuant to an Employee
election to be made six months and one day after ratification of this Agreement
by the Compensation Committee (the "Election Date") at a strike price equal to
the fair market value of the Company's common stock six months and one day
subsequent to the Election Date (the "Grant Date"); provided, however, that in
the event that such option grant creates an accounting repricing situation
whereby the Company would be required to apply variable compensation accounting
or any other adverse accounting charges for such option, the Company shall have
no obligation to grant all or any part of such option.  The fair market

                                      -2-
<PAGE>

value shall be determined first by reference to the publicly traded price, if
such security is traded on public markets, or the internal price used for other
employee stock option grants on or near the Grant Date. The new option granted
on the Grant Date shall vest in accordance with the standard vesting terms
offered to other employees in connection with any similar to-be-announced option
grant program, or on terms comparable to options generally granted to new
employees on or near the Grant Date, whichever is most favorable to Employee.

          c.   BONUSES.  The Company will provide Employee with an opportunity
               -------
to earn an annual cash bonus (the "Annual Bonus") each year during the term of
this Agreement. Employee's Annual Bonus for 2001 shall be guaranteed and shall
be $100,000, to be paid to Employee in the following amounts and on the
following dates if he is employed by the Company on those dates: (i) $33,333 on
June 30, 2001, (ii) $33,333 on September 30, 2001 and (iii) $33,334 on December
28, 2001. Beginning January 1, 2002, Employee will be eligible for a targeted
Annual Bonus of one hundred and fifty percent (150%) of the Base Salary based on
targeted performance . Employee's entitlement to and the amount of the Annual
Bonus shall be determined in the reasonable discretion of the Company's Chief
Executive Officer. The Company's Chief Executive Officer and Employee shall
mutually agree upon Employee's key objectives at the start of each calendar year
that will be used to determine the actual amount of the Employee's Annual Bonus.

          d.   VACATION.  Employee shall be entitled to three weeks vacation
               --------
during each year of employment.

          e.   ADDITIONAL BENEFITS. Employee will be eligible to participate in
               -------------------
the Company's employee benefit plans of general application, including without
limitation, those plans providing medical, disability and life insurance in
accordance with the rules established for individual participation in any such
plan and under applicable law. Employee will be eligible for sick leave in
accordance with the policies in effect during the term of this Agreement and
will receive such other benefits as the Company generally provides to its other
senior executive employees.

          f.   REIMBURSEMENT OF EXPENSES.  Employee shall be authorized to incur
               -------------------------
on behalf and for the benefit of, and shall be reimbursed by, the Company for
reasonable business expenses, provided that such expenses are substantiated in
accordance with Company policies. Company shall reimburse employee promptly. The
Company and Employee acknowledge that Employee's personal effects from an
abandoned, Company-requested move from Atlanta, Georgia to Houston, Texas are in
storage in Dallas, Texas. Employee agrees to terminate the need for storage on
or before December 31, 2001. Upon a written request from Employee, the Company
agrees to promptly pay Corporate Relocations, Inc. for monthly storage costs
("Storage Costs") and moving, unpacking and set-up costs associated with the
moving of Employee's personal effects from Dallas, Texas to final destination
("Moving Costs;" at this time anticipated to be Rockport, Maine). The Company
shall treat such payment to Corporate Relocations, Inc. in accordance with its
published Relocation Policy.

          g.   GOLDEN PARACHUTE PAYMENTS.  If a payment pursuant to this
               -------------------------
Agreement would result in (or increase) an excise tax under Internal Revenue
Code (S)4999(a), the excess parachute payment shall be reduced to that amount
(if any) which maximizes the difference between the excess parachute payment and
the excise tax.

          h.   CHANGE IN CONTROL. For purposes of this Agreement, "Change of
               -----------------
Control" means the occurrence of any of the following events:

                                      -3-
<PAGE>

               i.   Any "person," as such term is currently used in Section
     13(d) of the Securities Exchange Act of 1934, other than Jeffrey L. Walker
     and/or his affiliates, becomes a "beneficial owner," as such term is
     currently used in Rule 13d-3 promulgated under that Act of fifty percent
     (50%) or more of the Voting Stock of the Company. For purposes of this
     Agreement, Voting Stock means the issued and outstanding capital stock or
     other securities of any class or classes having general voting power under
     ordinary circumstances, in the absence of contingencies, to elect the
     directors of a corporation.

               ii.  The first day on which a majority of the Board consists of
     individuals other than Incumbent Directors, which term means the members of
     the Board on the date hereof; provided that any individual becoming a
     director subsequent to such date whose election or nomination for election
     was supported by two-thirds of the directors who then comprised the
     Incumbent Directors shall be considered to be an Incumbent Director.

               iii. The Board adopts any plan of liquidation providing for the
     distribution of all or substantially all of the Company's assets.

               iv.  All or substantially all of the assets or business of the
     Company are disposed of in any one or more transactions pursuant to a
     merger, consolidation or other transaction (unless the shareholders of the
     Company immediately prior to such merger, consolidation or other
     transaction beneficially own, directly or indirectly, in substantially the
     same proportion as they owned the Voting Stock, all of the Voting Stock or
     other ownership interests of the entity or entities, if any, that succeed
     to the business of the Company).

               v.   The Company combines with another company and is the
     surviving corporation but, immediately after the combination, the
     shareholders of the Company immediately prior to the combination hold,
     directly or indirectly, fifty percent (50%) or less of the Voting Stock of
     the combined company, (there being excluded from the number of shares held
     by such shareholders, but not from the Voting Stock of the combined
     company, any shares received by affiliates of such other company in
     exchange for securities of such other company).

     5.   TERMINATION OF EMPLOYMENT AND SEVERANCE BENEFITS.
          ------------------------------------------------

          a.   TERMINATION OF EMPLOYMENT. This Agreement may be terminated
               -------------------------
during its Original Term (or any extension thereof) upon the occurrence of any
of the following events:

                i.   The Employee's Termination for Cause (as defined in Section
     6):

                ii.  The Company's termination of Employee without Cause, which
     determination may be made by the Company at any time at the Company's sole
     discretion, for any or no reason ("Termination Without Cause");

                iii. The Employee's "Constructive Termination" (as defined in
     Section 7); or

                                      -4-
<PAGE>

                iv.  The effective date of a written notice sent to the Company
     from Employee stating that Employee is electing to terminate his employment
     with the Company ("Voluntary Termination").

          b.   SEVERANCE BENEFITS.  Employee shall be entitled to receive
               ------------------
severance benefits upon termination of employment only as set forth in this
subsection.

               i.  VOLUNTARY TERMINATION.  If Employee's employment terminates
                   ---------------------
     by Voluntary Termination, then all compensation under this Agreement shall
     cease to accrue as of the date of termination and Employee shall not be
     entitled to receive payment of any severance benefits. Employee's benefits
     will be continued under the Company's then existing benefit plans and
     policies in accordance with such plans and policies in effect on the date
     of termination, and any earned Base Salary shall be paid through normal
     payroll.

               ii.  INVOLUNTARY TERMINATION.  If Employee's employment is
                    -----------------------
     terminated other than by reason of Employee's death, having become Totally
     Disabled under subsection (d), Voluntary Termination or Termination for
     Cause (an "Involuntary Termination"), Employee's regular compensation shall
     cease to accrue under this Agreement as of the date of termination.
     Employee shall then be entitled to payment of all regular compensation
     earned through the date of termination and a pro rata portion of any deemed
     target Annual Bonus for the year that includes the termination within
     thirty (30) days of the termination. Such deemed target Annual Bonus shall
     equal the full target Annual Bonus for the year multiplied by a fraction,
     the numerator of which is the number of days in the year through the date
     of the Employee's termination and the denominator of which is 365. In
     addition, Employee shall be entitled to receive a monthly severance
     benefit, payable through the Company's normal payroll, beginning on the
     first payroll date that follows Employee's termination date, and continuing
     for six (6) months. Such monthly severance benefit shall be equal to
     Employee's Base Salary. In addition, immediately upon an Involuntary
     Termination, all vested options to purchase Company stock, that are either
     held by Employee on the date of this Agreement or are otherwise described
     in Section 4(b), shall become fully exercisable through the one year
     anniversary of the date of the Involuntary Termination; provided, however,
     that if the Involuntarily Termination occurs prior to the one year
     anniversary of the Effective Date, then the Company shall accelerate the
     option to purchase Company stock described in Section 4(b) above so that
     the option shall be exercisable as if 37,500 shares became exercisable at
     the end of each three-month period commencing on the Effective Date and the
     option shall otherwise cease to vest. For avoidance of doubt, with respect
     to the option to purchase Company stock described in Section 4(b) above, if
     there is an Involuntary Termination of Employee occurs three (3) months
     after the Effective Date, 37,500 shares of the option to purchase Company
     stock described in Section 4(b) above would be accelerated so as to be
     exercisable on the date of the Involuntary Termination and another 37,500
     shares of the option to purchase Company stock described in Section 4(b)
     above would be accelerated so as to be exercisable on the date of the
     Involuntary Termination. If Employee elects to continue to receive health
     insurance benefits following termination, the Company shall pay the full
     cost of such continuation of coverage during the Severance Period. A
     Constructive Termination (as defined below) will be treated as an
     Involuntary Termination.

               iii.  TERMINATION FOR CAUSE.  If Employee's employment is
                     ---------------------
     terminated for Cause, then Employee shall be entitled to receive Employee's
     Base Salary through the date of termination.  Employee's Base Salary shall
     cease to accrue after the date of

                                      -5-
<PAGE>

     such termination for Cause. All of Employee's right to the Annual Bonus
     which accrue or become payable after the date of such termination for Cause
     shall terminate and cease upon such termination for Cause. In addition, all
     other compensation payable under this Agreement shall cease as of the date
     of termination and Employee shall not be entitled to receive payment of
     severance benefits. Employee's benefits will be continued under the
     Company's then existing benefit plans and policies in accordance with such
     plans and policies in effect on the date of termination.

          c.   DEATH.  If Employee should die during the term of this Agreement
               -----
while he remains employed under this Agreement and not Totally Disabled (as
defined in subsection (d)), the Company shall pay to Employee's estate a pro
rata portion of any deemed target Annual Bonus for the year of Employee's death
within thirty (30) days of Employee's death. Such deemed target Annual Bonus
shall equal the full target Annual Bonus for the year multiplied by a fraction,
the numerator of which is the number of days in the year through the date of the
Employee's death and the denominator of which is 365. Base Salary and all other
benefits are to be paid up to the date of the death of the Employee.

          d.   DISABILITY.  This Agreement shall also terminate upon the date
               ----------
the Employee shall be deemed to be Totally Disabled. The Employee will be deemed
"Totally Disabled" if the Employee is unable as a result of a physical injury or
physical or mental illness to participate materially in the Company's business
and to perform substantially all of the duties required of his under the terms
of this Agreement for an aggregate total of ninety (90) days (whether
consecutive or non-consecutive) during any three hundred sixty (360) day period
during the term hereof. If Employee's employment with the Company is terminated
because of Employee's Total Disability, the Company shall pay the Employee his
Base Salary and other benefits through the effective Termination Date and a pro
rata portion of any deemed target Annual Bonus for the year Employee became
Totally Disabled within thirty (30) days of the date that it is determined that
Employee is Totally Disabled. Such deemed target Annual Bonus shall equal the
full target Annual Bonus for the year multiplied by a fraction, the numerator of
which is the number of days in the year through the day before the first date
the Employee is deemed to be Totally Disabled and the denominator of which is
365.

     6.   DEFINITION OF TERMINATION FOR CAUSE.  For purposes of this Agreement,
          -----------------------------------
a "Termination for Cause" means the Employee's termination by the Company
following the discovery of the occurrence of one or more of the following
events:

          a.   Employee's willful misconduct or gross negligence in the
performance of his duties hereunder, including Employee's refusal to comply in
any material respect with the legal directive of the Company's Chief Executive
Officer, or any committee thereof, so long as such directives are not
inconsistent with the Employee's position and duties, and such refusal to comply
is not remedied within five (5) working days after receipt of written notice
from the Company, which written notice shall state that failure to remedy such
conduct may result in Termination for Cause;

          b.   Dishonest or fraudulent conduct that materially discredits the
Company or is materially detrimental to the Company's reputation, business,
operations, or relations with its employees, suppliers or customers;

          c.   Employee's incurable material breach of this Agreement or any
element of the Company's Employee Proprietary Information and Invention
Assignment Agreement, including

                                      -6-
<PAGE>

without limitation, Employee's theft or other deliberate misappropriation of the
Company's proprietary information;

          d.   Employee's conviction of a felony or of a misdemeanor involving
fraud, dishonesty or moral turpitude with respect to the Company or any of its
customers or suppliers;

          e.   Employee's habitual abuse of alcohol or prescription drugs, other
than in doses prescribed by a licensed physician, or abuse of controlled
substances that has a material adverse impact on his job performance; or

          f.   Employee fails to meet minimum performance standards established
by the Company's Chief Executive Officer and set forth in a mutually agreed
written performance improvement plan, such agreement not to be unreasonably
withheld, with a minimum ninety (90) day period to cure such performance
deficiencies.

     7.   DEFINITION OF CONSTRUCTIVE TERMINATION.  A "Constructive Termination"
          --------------------------------------
shall be deemed to occur if without Employee's express written consent (a)
either (i) there is a material adverse change in Employee's position, title,
stature, duties or responsibilities which remains uncorrected for thirty (30)
days or more following Employee's written notice to the Company, or (ii) a
reduction of Employee's Base Salary and (b) within 90 days of the occurrence of
any event listed in clause (a), Employee provides the Company written notice
that Employee is electing to terminate his employment with the Company.

     8.   CONFIDENTIALITY AGREEMENT.  Employee has signed an Employee
          -------------------------
Proprietary Information and Invention Agreement, dated August 2, 1999, attached
hereto as Exhibit A, which agreement remains in full force and effect.

     9.   NON-COMPETITION, ETC.
          --------------------

          a.   Employee covenants and agrees that during the Original Term or
any extension thereof plus for the period of time he receives Severance Benefits
due to an Involuntary Termination, Employee (i) shall not engage, anywhere
within the geographical areas in which the Company is then conducting its
business operations, directly or indirectly, alone, in association with or as a
shareholder, principal, agent, partner, officer, director, employee or
consultant of any other organization, in any business (a "Competitive Business")
which directly competes with any business then being conducted by the Company;
provided, that the foregoing shall not prohibit the Employee from owning a
maximum of two percent (2%) of the common stock of any publicly traded
corporation; (ii) shall not solicit to leave the employ of the Company or hire
any officer, employee or consultant of the Company; (iii) shall not solicit,
divert or to take away, the business or patronage of any of the customers or
accounts of the Company, which were contacted, solicited or served by the
Employee at any time during the Employee's employment; and (iv) shall not
acquire, or assist any other party in acquiring, any shares of the Company, or
otherwise seek, or assist any other party in seeking to gain control of the
Company.

          b.   The Employee acknowledges and agrees that because of the nature
of the business in which the Company is engaged and because of the nature of the
confidential information to which the Employee has access during his employment
as described in Exhibit A, it would be impractical and excessively difficult to
determine the actual damages of the Company in the event the Employee breached
any of the covenants of subsection (a) or Exhibit A, and remedies at law (such
as monetary damages) for any breach of the Employee's obligations under
subsection (a) or Exhibit A

                                      -7-
<PAGE>

would be inadequate. The Employee therefore agrees and consents that if he
commits any breach of a covenant under subsection (a) or Exhibit A or threatens
to commit any such breach, the Company shall have the right (in addition to, and
not in lieu of, any other right or remedy that may be available to it) to
temporary and permanent injunctive relief from a court of competent
jurisdiction. Employee acknowledges and agrees that subsection (a) of this
Section is reasonable and is necessary for the legitimate protection of the
Company, and will not deprive Employee of a reasonable opportunity to practice
his profession or trade. With respect to any provision of subsection (a) or
Exhibit A that is finally determined to be unenforceable, the Employee and the
Company hereby agree that this Agreement or any provision hereof shall be
reformed in a manner that retains as much of the original intent of the
Agreement as is both practicable and consistent with applicable law.

     10.  CONFLICTS.  Employee represents that his performance of all the terms
          ---------
of this Agreement will not breach any other agreement to which Employee is a
party. Employee has not, and will not during the term of this Agreement, enter
into any oral or written agreement in conflict with any of the provisions of
this Agreement. Employee further represents that he is entering into or has
entered into an employment relationship with the Company of his own free will.

     11.  SUCCESSORS.  Any successor to the Company (whether direct or indirect
          ----------
and whether by purchase, lease, merger, consolidation, liquidation or otherwise)
to all or substantially all of the Company's business and/or assets shall assume
the obligations under this Agreement and agree expressly to perform the
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession. The terms of this Agreement and all of Employee's rights hereunder
shall inure to the benefit of, and be enforceable by, Employee's personal or
legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees .

     12.  NOTICE.  Any notice required or permitted by this Agreement shall be
          ------
in writing and shall be deemed sufficient on the date of delivery, when
delivered personally or by overnight courier or sent by telegram or fax, or
forty-eight (48) hours after being deposited in the U.S. mail, as certified or
registered mail, with first class postage prepaid, and addressed to the party to
be notified at such party's address as set forth below, or as subsequently
modified by written notice. Employee's address is 10 Maple Street, Rockport,
Maine, 04856, Facsimile: (207) 236-4105. Company's address is TenFold
Corporation, Attn: General Counsel, 180 West Election Road, Suite 100, Draper,
Utah 84020, Facsimile: (801) 619-8204.

     13.  GENERAL RELEASE. In consideration of you employment by the Company,
          ---------------
you on behalf of yourself and any past, present or future heirs, executors,
administrators, or assigns, hereby irrevocably and unconditionally release and
hold harmless the Company, TenFold Energy, Inc. and each of the Company's and/or
TenFold Energy, Inc.'s respective agents, directors, officers, employees,
representatives, attorneys and affiliated companies, divisions, subsidiaries and
parents (and agents, directors, officers, employees, representatives and
attorneys of such affiliates), and their predecessors, successors, heirs,
executors, administrators and assigns, and all persons acting by, through, under
or in concert with any of them (collectively "Releasees"), or any of them, from
any and all actions, causes of action, suits, debts, charges, complaints,
claims, demands, losses, liabilities and obligations of any nature whatsoever,
in law or equity, known or unknown, suspected or unsuspected, which you ever
had, now have, or you or your heirs, executors, administrators or assigns
hereafter may claim to have against each or any of the Releasees (hereinafter
"the Claims"), arising from or relating in any way to your employment
relationship to date with the Company or TenFold Energy, Inc. or the termination
thereof, whether the Claims arise from any alleged violation by the Company or
TenFold Energy, Inc.

                                      -8-
<PAGE>

of any federal, state or local statutes, ordinances or common law, and whether
based on contract, tort, or statute or any other legal or equitable theory of
recovery. Such claims include, without limitation, any claims relating to
severance, stock options or other benefits, unpaid wages, salary or incentive
payment, breach of contract, wrongful discharge, or employment discrimination
under any applicable federal, state or local statute, provision, order or
regulation, including but not limited to, any claim under Title VII and the Age
Discrimination in Employment Act. You understand this is to be a general release
of all Claims. You expressly and knowingly waive any and all rights under
Section 1542 of the Civil Code of the State of California, which provides as
follows:


     "A general release does not extend to claims which 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."

For all purposes of this section of this Agreement, the term "creditor" as used
and referenced in Section 1542 of the Civil Code of the State of California
means and includes you, your heirs, executors, administrators, or assigns.
Nothing in this Section 13 shall in any way limit Employee's rights under the
Indemnification Agreement, dated March 1, 2000, by and between the Company and
Employee.

     14.  MISCELLANEOUS PROVISIONS.
          ------------------------

          a.   NO DUTY TO MITIGATE.  Employee shall not be required to mitigate
               -------------------
the amount of any payment contemplated by this Agreement (whether by seeking new
employment or in any other manner), nor shall any such payment be reduced by any
earnings that Employee may receive from any other source.

          b.   WAIVERS, ETC.  No amendment of this Agreement and no waiver of
               ------------
any one or more of the provisions hereof shall be effective unless set forth in
writing by such person against whom enforcement is sought.

          c.   SOLE AGREEMENT.  With the exception of the Employee Proprietary
               --------------
Information and Invention Agreement, dated August 2,1999, the Indemnification
Agreement, dated March 1, 2000, and stock options granted Employee, this
Agreement constitutes the sole agreement of the parties and supersedes all oral
negotiations and prior writings with respect to the subject matter hereof. To
the extent this Agreement affects any pre-existing award of equity-based
compensation, such award shall be deemed amended consistent with this Agreement.

          d.   AMENDMENT.  This agreement may be amended, modified, suppressed
               ---------
or canceled only by an agreement in writing executed by both parties hereto.

          e.   CHOICE OF LAW.  The validity, interpretation, construction and
               -------------
performance of this Agreement shall be governed by the laws of the State of
California, without giving effect to the principles of conflict of laws.

          f.   VENUE.  All disputes, claims or proceedings between the parties
               -----
related to the validity, construction or performance of this Agreement shall be
subject to the choice of jurisdiction of the state and federal courts of the
State of California. The parties irrevocably consent to jurisdiction in the
courts of the State of California for resolution of any claim or dispute
hereunder, and such shall be the exclusive forum for the resolution of such
claim or dispute.

                                      -9-
<PAGE>

          g.   SEVERABILITY.  If any term or provision of this Agreement or the
               ------------
application thereof to any circumstance shall, in any jurisdiction and to any
extent, be invalid or unenforceable, such term or provision shall be ineffective
as to such jurisdiction to the extent of such invalidity or unenforceability
without invalidating or rendering unenforceable the remaining terms and
provisions of this Agreement or the application of such terms and provisions to
circumstances other than those as to which it is held invalid or unenforceable,
and a suitable and equitable term or provision shall be substituted therefor to
carry out, insofar as may be valid and enforceable, the intent and purpose of
the invalid or unenforceable term or provision.

          h.   COUNTERPARTS.  This Agreement may be executed in counterparts,
               ------------
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.

                          [SIGNATURE PAGE TO FOLLOW]

                                     -10-
<PAGE>

     The parties have executed this Agreement as of the Effective Date.

                              TENFOLD CORPORATION



                              _____________________________________________
                              By:  Nancy M. Harvey
                              Title:  President and Chief Executive Officer

                              EMPLOYEE


                              _____________________________________________
                              Donald R. Jefferis

                                     -11-
<PAGE>

                                   EXHIBIT A
                       EMPLOYEE PROPRIETARY INFORMATION
                            AND INVENTION AGREEMENT



                                      A-1
<PAGE>

                              TENFOLD CORPORATION

           EMPLOYEE PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT


     In consideration of my continued employment by TenFold Corporation (the
"Company"), I hereby agree to certain restrictions placed by the Company on my
use and development of information and technology of the Company, as more fully
set out below.

     1.   Proprietary Information.

          (a)  Confidential Restrictions. I understand that, in the course of
my work as an employee of the Company, I have had and may have access to
Proprietary Information (as defined below) concerning the Company and its
clients. I acknowledge that the Company has developed, complied, and otherwise
obtained, often at great expense, this information, which has great value to the
Company's business. I agree to hold in strict confidence and in trust for the
sole benefit of the Company all Proprietary Information and will not disclose
any Proprietary Information, directly or indirectly, to anyone outside of the
Company, or use, copy, publish, summarize, or remove from Company premises such
information (or remove from the premises any other property of the Company)
except during my employment to the extent necessary to carry out my
responsibilities as an employee of the Company. I further understand that the
publication of any Proprietary Information through literature or speeches must
be approved in advance in writing by the Company.

          (b)  Proprietary Information Defined.  I understand that the reference
to "Proprietary Information" in this Agreement means all information and any
idea in whatever form, tangible or intangible, whether disclosed to or learned
or developed by me, pertaining in any manner to the business of the Company (or
any affiliate of it that might be formed) or to the Company's clients,
consultants, or business associates unless: (i) the information is or becomes
publicly known through lawful means; (ii) the information was rightfully in my
possession or part of my general knowledge prior to my employment by the
Company; or (iii) the information is disclosed to me without confidential or
proprietary restriction by a third party who rightfully possesses the
information (without confidential or proprietary restriction) and did not learn
of it, directly or indirectly, from the Company. I further understand that the
Company considers the following information to be included, without limitation,
in the definition of Proprietary Information: (w) formulas, computer programs,
teaching techniques, processes, trade secrets, electronic codes, proprietary
techniques, inventions, improvements, and research projects; (x) information
about costs, profits, markets, sales, and lists of customers; (y) plans for
future development and new product concepts; and (z) all documents, books,
papers, drawings, models, sketches, and other data of any kind and description,
including electronic data recorded or retrieved by any means, that have been or
will be given to me by the Company (or any affiliate of it that might be
formed), as well as written or verbal instructions or comments.

          (c)  Third Party Information.  I recognize that the Company has
received and in the future will receive from third parties their confidential or
proprietary information subject to a duty on the Company's part to maintain the
confidentialty of such information and to use it only for certain limited
purposes. I agree that I owe the Company and such third parties, during the term
of my employment and thereafter, a duty to hold all such confidential or
proprietary information in the strictest confidence and not to disclose it to
any person, firm, or corporation (except as necessary in carrying out my work
for the Company consistent with the Company's agreement with such third party)
or to use it for the benefit of anyone other than for the Company or such third
party (consistent with the Company's agreement with such third party) without
the express written authorization of the Company.

          (d)  Interference with Business.  During my employment with the
Company, I will not, without the Company's express consent, engage in any
employment in a competing business. I agree
<PAGE>

that, for six months after termination of my employment with the Company, I will
not recruit or hire any Company employee without the Company's written consent.

     2.   Inventions.

          (a)  Defined; Statutory Notice. I understand that during the term of
my employment, there are certain restrictions on my development of technology,
ideas, and inventions, referred to in this Agreement as "Invention Ideas." The
term Invention Ideas means any and all ideas, processes, trademarks, service
marks, inventions, technology, computer programs, original works of authorship,
designs, formulas, discoveries, patents, copyrights, and all improvements,
rights, and claims related to the foregoing that are conceived, developed, or
reduced to practice by me alone or with others except to the extent that
California Labor Code Section 2870 lawfully prohibits the assignment of rights
in such ideas, processes, inventions, etc. I understand that Section 2870(a)
provides:

          Any provision in an employment agreement which provides that
          an employee shall assign, or offer to assign, any of his or
          her rights in an invention to his or her employer shall not
          apply to an invention that the employee developed entirely
          on his or her own time without using the employer's
          equipment, supplies, facilities, or trade secret information
          except for those inventions that either:

               (1)  Relate at the time of conception or reduction to practice of
the invention to the employer's business, or actual or demonstrably anticipated
research or development of the employer.

               (2)  Result from any work performed by the employee for the
employer.

          (b)  Disclosure. I agree to maintain adequate and current written
records on the development of all Invention Ideas and to disclose promptly to
the Company all Invention Ideas and relevant records, which records will remain
the sole property of the Company. I further agree that all information and
records pertaining to any idea, process, trademark, service mark, invention,
technology, computer program, original work of authorship, design, formula,
discovery, patent, or copyright that I do not believe to be an Invention Idea,
but is conceived, developed, or reduced to practice by me (alone or with others)
during my period of employment, shall be promptly disclosed to the Company (such
disclosure to be received in confidence). The Company shall examine such
information to determine if in fact the idea, process, or invention, etc, is an
Invention Idea subject to this Agreement.

          (c)  Assignment. I hereby assign to the Company, without further
consideration, my entire right, title, and interest (throughout the United
States and in all foreign countries), free and clear of all liens and
encumbrances, in and to each Invention Idea, which shall be the sole property of
the Company, whether or not patentable. In the event any Invention Idea shall be
deemed by the Company to be patentable or otherwise registrable, I will assist
the Company (at its expense) in obtaining letters patent or other applicable
registrations thereon and I will execute all documents and do all other things
(including testifying at the Company's expense) necessary or proper to obtain
letters patent or other applicable registrations thereon and to vest the Company
with full title thereto. Should the Company be unable to secure my signature on
any document necessary to apply for, prosecute, obtain, or enforce any patent,
copyright, or other right or protection relating to any Invention Idea, whether
due to my mental or physical incapacity or any other cause, I hereby irrevocably
designate and appoint the Company and each of its duly authorized officers and
agents as my agent and attorney-in-fact, to act for and in my behalf and stead,
to execute and file any such document, and to do all other lawfully permitted
acts to further the prosecution, issuance, and enforcement of patents,
copyrights, or other rights or protections with the same force and effect as if
executed and delivered by me.

          (d)  Exclusions.  Except as disclosed in Exhibit A, there are no
ideas, processes, trademarks, service marks, inventions, technology, computer
programs, original works of authorship, designs, formulas, discoveries, patents,
copyrights, or improvements to the foregoing that I wish to exclude from the
operation of this Agreement. To the best of my knowledge, there is no existing
contract
<PAGE>

in conflict with this Agreement or any other contract to assign ideas,
processes, trademarks, service marks, inventions, technology, computer programs,
original works of authorship, designs, formulas, discoveries, patents, or
copyrights that is now in existence between me and any other person or entity.

          (e)  Pre-existing Material. To the extent that any Invention Ideas
incorporate pre-existing material or any materials disclosed on Exhibit A to
which I possess copyright, trade secret, trademark or other proprietary rights,
and such rights are not otherwise assigned to the Company herein, I hereby grant
to the Company a royalty-free, irrevocable, worldwide, nonexclusive, perpetual
license to make, have made, sell, use and disclose, reproduce, modify, prepare
Derivative Works based on, distribute, and perform and display (publicly or
otherwise), such material, with full right to authorize others to do so.

          With respect to pre-existing material that I provide to the Company
for use in or with one of its products, and to which I retain copyright, trade
secret, trademark or other proprietary rights not otherwise assigned to the
Company herein, I hereby grant to the Company a royalty-free, irrevocable,
worldwide, nonexclusive, perpetual license to make, have made, sell, use and
disclose, reproduce, modify, prepare Derivative Works based on, distribute, and
perform and display (publicly or otherwise), such material, with full right to
authorize others to do so.

          "Derivative Work," with respect to material, means any translation,
port, modification, correction, addition, extension, upgrade, improvement,
compilation, abridgement or other form in which the material may be recast,
transformed or adapted, including but not limited to all forms in which such
Derivative Works would infringe any of the copyrights, including audiovisual
copyrights, in the material.

     3.   Former or Conflicting Agreements. During my employment with the
Company, I will not disclose to the Company, or use, or induce the Company to
use, any proprietary information or trade secrets of others. I represent and
warrant that I have returned all property and confidential information belonging
to all prior employers. I further represent and warrant that my performance of
the terms of this Agreement will not breach any agreement to keep in confidence
proprietary information acquired by me in confidence or in trust prior to my
employment by the Company. I have not entered into, and I agree I will not enter
into, any oral or written agreement in conflict herewith.

     4.   Government Contracts. I understand that the Company has or may enter
into contracts with the government under which certain intellectual property
rights will be required to be protected, assigned, licensed, or otherwise
transferred and I hereby agree to execute such other documents and agreements as
are necessary to enable the Company to meet its obligations under any such
government contracts.

     5.   Termination. I hereby acknowledge and agree that all personal
property, including, without limitation, all books, manuals, records, models,
drawings, reports, notes, contracts, lists, blueprints, and other documents or
materials or copies thereof. Proprietary Information, and equipment furnished to
or prepared by me in the course of or incident to my employment, belong to the
Company and will be promptly returned to the Company upon termination of my
employment with the Company. Following my termination, I will not retain any
written or other tangible material containing any Proprietary Information or
information pertaining to any Invention Idea. I understand that my obligations
contained herein will survive the termination of my employment and that I will
continue to make all disclosures required of me by paragraph 2(b). In the event
of the termination of my employment, I agree to sign and deliver the Termination
Certificate attached as Exhibit B.

     6.   Remedies. I recognize that nothing in this Agreement is intended to
limit any remedy of the Company under the California Uniform Trade Secrets Act
and that I could face possible criminal and civil actions, resulting in
imprisonment and substantial monetary liability if I misappropriate the
Company's trade secrets. In addition, I recognize that my violation of this
Agreement could cause the Company irreparable harm, the amount of which may be
extremely difficult to estimate, thus, making any
<PAGE>

remedy at law or in damages inadequate. Therefore, I agree that the Company
shall have the right to apply to any court of competent jurisdiction for an
order restraining any breach or threatened breach of this Agreement and for any
other relief the Company deems appropriate. This right shall be in addition to
any other remedy available to the Company in law or equity.

     7.   Miscellaneous Provisions.

          (a)  Assignment.  I agree that the Company may assign to another
person or entity any of its rights under this Agreement.

          (b)  Governing Law; Severability.  The validity, interpretation,
enforceability, and performance of this Agreement shall be governed by and
construed in accordance with the laws of the State of California. If any
provision of this Agreement, or application thereof to any person, place, or
circumstance, shall be held by a court of competent jurisdiction to be invalid,
unenforceable, or void, the remainder of this Agreement and such provisions as
applied to other persons, places, and circumstances shall remain in full force
and effect.

          (c)  Entire Agreement.  The terms of this Agreement are the final
expression of my agreement with respect to the subject matter hereof and may not
be contradicted by evidence of any prior or contemporaneous agreement. This
Agreement shall constitute the complete and exclusive statement of its terms and
no extrinsic evidence whatsoever may be introduced in any judicial,
administrative, or other legal proceeding involving this Agreement.

          (d)  Successors and Assigns.  This Agreement shall be binding upon me
and my heirs, executors, administrators, and successors, and shall inure to the
benefit of the Company's successors and assigns.

          (e)  Application of this Agreement.  I hereby agree that my
obligations set forth in Section 1 and 2 hereof and the definitions of
Proprietary Information and Invention Ideas contained therein shall be equally
applicable to Proprietary Information and Invention ideas relating to any work
performed by me for the Company prior to the execution of this Agreement.

          I HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS. I HAVE
COMPLETELY NOTED ON EXHIBIT A TO THIS AGREEMENT ANY PROPRIETARY INFORMATION,
IDEAS, PROCESSES, TRADEMARKS, SERVICE MARKS, INVENTIONS TECHNOLOGY, COMPUTER
PROGRAMS, ORIGINAL WORKS OF AUTHORSHIP, DESIGNS, FORMULAS, DISCOVERIES, PATENTS,
COPYRIGHTS, OR IMPROVEMENTS, RIGHTS, OR CLAIMS RELATING TO THE FOREGOING THAT I
DESIRE TO EXCLUDE FROM THIS AGREEMENT.

DATE: 8/2/99
      --------------

                                        /s/ Donald R. Jefferis
                                        Employee Signature


                                        Donald R. Jefferis
                                        Printed Employee Name

<PAGE>

                                   EXHIBIT A

                             EMPLOYEE'S DISCLOSURE

     1.   Proprietary Information. Except as set forth below, I acknowledge that
at this time I know nothing about the business or Proprietary Information of the
Company, other than information I have learned from the Company in the course of
being hired:

          - Agree -

     2.   Prior Inventions. Except as set forth below, there are no ideas,
processes, trademarks, service marks, inventions, technology, computer programs,
original works of authorship, designs, formulas, discoveries, patents,
copyrights, or any claims, rights, or improvements to the foregoing that I wish
to exclude from the operation of this Agreement:

          - None -





Date: 8/2/99                      /s/ D. R. Jefferies
     ----------------             Employee Signature

                                  Donald R. Jefferies
                                  Printed Employee Name