EXHIBIT 10.21

# September 22, 2004

# Delivered by Hand

Mr. Joo-Hyung (Tommy) Lee
#201-1717 Bayshore Drive
Vancouver, B.C. 
V6G 3H3:

# Re: Termination of
Employment and Severance Agreements

This letter will confirm our
discussion of September 22, 2004 during which I advised you that as a result of corporate
restructuring and downsizing your employment with MDSI will end effective close of
business September 22, 2004.

As a result, the following severance
package will be made available to you in order to assist you during the hopefully brief
period that you will be without employment and to provide you with some financial
security.

(a)    
          Severance  you will receive a lump sum termination payment in an amount
          equal to eighteen (18) months base salary ($300,000 CDN) in accordance with
          paragraph 12.4 of the Employment Agreement between you and MDSI, less applicable
          statutory withholdings and deductions. In accordance with paragraph 12.4 of the
          Employment Agreement, you are requested to advise the Company within five (5)
          working days whether you wish to receive this severance payment in a lump sum or
          in intervals over a defined period.

(b)    
          Benefits  the Company shall maintain you and your eligible dependents on
          record as of September 22, 2004, on the Company Benefit Program to March 31,
          2006 or the date on which you find alternate employment, whichever comes first.
          Upon the expiration of these benefits, you may elect to convert the coverage
          into an individual policy. If you elect to do so, please contact Bob Olsen at
          Zlotnik, Lamb & Co. at 604-688-7208.

(c)    
          Employee Share Ownership Plan  if you have been participating in the
          Employee Share Ownership Plan, you may elect to authorize MDSI to continue to
          hold the total contribution made to be applied against future purchases of
          shares in accordance with the Plan or elect a refund of contributions. Please
          contact Delia Sy at 604-207-6304 with respect to your election.

(d)    
          Stock Options  all stock options granted to you by MDSI shall continue to
          vest to until March 22, 2006. You will have sixty (60) days from March 22, 2006
          to exercise any vested options. Options not vested by March 22, 2006 shall be
          cancelled. Should you wish to exercise your options please contact Julie Wong at
          604-207-6297.

(e)    
          Vacation  accrued vacation standing to your credit as of September 22,
          2004 of 45.50 days shall be paid to you as soon as reasonably practical but no
          later than October 15, 2004.

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(f)    
          Career Transition  the Company will provide you with access to the Career
          Transition program offered by Knightsbridge Career Management. This program
          allows you to fully participate in choosing services to best suit your needs to
          a maximum value of $5,000. You and your Knightsbridge consultant will jointly
          select appropriate services and manage your program to ensure maximum relevance
          and value. Should you wish to participate in this program please contact Ron
          Toffolo at 604-207-6298.

(g)    
          Letter of Reference  upon request, the Company will provide you with a
          letter of reference on mutually agreeable terms.

Your departure will be characterized
internally and externally as a resignation initiated by you and you agree to resign as an
officer of MDSI and or director of any of MDSIs subsidiaries and corporate
affiliates as applicable effective as of September 22, 2004.

All Company material which has been
issued to you on loan, such as your employee security card, photo ID, parking pass, credit
card, calling card, computer equipment and software, cellular phone and any other Company
property issued to you must be returned prior to your final day of employment.

The payment as outlined in paragraph
(a) above is conditional upon your execution of the Settlement and Release Agreement
attached hereto, which is to be returned to me by no later than 5:00 p.m. September 29,
2004. It is understood and agreed that you have the opportunity to seek outside legal
and/or financial counsel to consider this matter.

You are reminded of the conditions of
your Employment Agreement and your duties and obligations with respect to non-disclosure
of confidential information, trade secrets and work product and conflict of interest and
non-competition.

I sincerely regret that this action
had to be taken. I hope that the foregoing will assist you in planning for the future. On
behalf of the Company we wish to thank you for your contribution to MDSI and wish you
every success in your future endeavours.

Sincerely,

# MDSI Mobile Data
Solutions Inc.

Erik Dysthe
President and CEO

|                                                               |            
|-------------------------------------------------------------- | -----------
|Tommy Lee - Termination of Employment and Severance Agreements | page 2 of 2

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23rd
September 2004

RE:
Termination of Employment  Severance Payment Schedule

MDSI Mobile Data Solutions Inc.
(MDSI) and Joo-Hyung (Tommy) Lee (Mr. Lee) agree to the following
payment schedule for the severance package that MDSI will pay to Mr. Lee, as defined in
Mr. Lees employment agreement with MDSI:

a.    
          Within 5 work days from the date of Mr. Lees employment termination, MDSI
          will pay Mr. Lee via direct deposit to his bank account the amount of $194,500
          (in Canadian dollars, and before taxes) owed to Mr. Lee by MDSI, and in
          addition, MDSI will pay $15,500 (in Canadian dollars, and before taxes) to Mr.
          Lees RRSP account at TD Waterhouse (account number: 832718-S, name: Tommy
          J.H. Lee).

b.    
          On the date of January 3rd, 2005, MDSI will pay Mr. Lee via direct deposit to
          his bank account the amount of $73,800 (in Canadian dollars, and before taxes)
          owed to Mr. Lee by MDSI, and in addition, MDSI will pay $16,200 (in Canadian
          dollars, and before taxes) to Mr. Lees RRSP account at TD Waterhouse
          (account number: 832718-S, name: Tommy J.H. Lee).  Address: #100  888 Dunsmuir St.
Vancouver, B.C. V6C 3K4

It is agreed that Mr. Lees
outstanding accrued vacation of 45.50 days (converted to equivalent amount in cash based
on Mr. Lees salary) will be paid by MDSI to Mr. Lee no later than October
15th, 2004.

With the exception of the above
payments to the RRSP account, it is understood that the amounts paid will have applicable
statutory withholdings and deductions applied.

It is understood that the bank
account referred to above is the same as that used by MDSI to pay Mr. Lees biweekly
salary while he was employed with MDSI.

Signed:

|                          |                
|------------------------- | ---------------
|/s/ Joo-Hyung (Tommy) Lee | 23rd Sept. 2004
|Joo-Hyung (Tommy) Lee     | Date           
|                         
|/s/ Ron Toffolo           | Sept. 23/04    
|Ron Toffolo               | Date           
|VP Human Resources        |                
|MDSI Authorized Signatory |                

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# RELEASE

1.    
          Joo-Hyung (Tommy) Lee (Lee) for such good and valuable consideration
as set out in the Re:  Termination of Employment and Severance Agreement letter
of September 22, 2004 to Lee from MDSI Mobile Data Solutions Inc. (MDSI) and  for other good and valuable consideration, does
          forever release and forever discharge MDSI from any and all manners of claims, causes of action,
          proceedings, complaints, damages, costs, disbursements, liabilities and
          obligations of any nature or kind whatsoever known or unknown whether in law or
          in equity or pursuant to statute, which, as against MDSI or other such persons
          or any of them Lee has ever had or now has by reason of or arising out of any
          cause, matter or thing whatsoever occurring or existing and without limiting the
          generality of the foregoing, any matter, cause, or thing relating to or arising
          out of Lees employment with MDSI, his contract of employment with MDSI, or
          the termination of Lees employment with MDSI, and any other claim for
          damages, notice, payment in lieu of notice, wrongful dismissal, severance pay,
          loss of benefits, pension issues, incentive or any other bonus program, profit
          sharing, stock distribution, stock options or stock purchase rights, vacation
          pay or any claims under the British Columbia Employment Standards Act or
          Human Rights Code.

2.    
          This Release is binding upon and enures to the benefit of Lees heirs,
          executors, administrators, assigns, committees and trustees.

3.    
          This Release is binding upon and enures to the benefit of MDSIs directors,
          officers, employees, agents, predecessors, successors, assigns, liquidators,
          receivers, receiver managers, trustees, owners and shareholders.

4.    
          In the event withholdings have not been deducted which should have been
          deducted, Lee shall indemnify and save harmless MDSI from any resulting
          liabilities, obligations, and costs regarding any claims which Canada Customs
          and Revenue Agency, Employment Insurance Commission or any other government
          agency or department may have with respect to any payments made to or on behalf
          of Lee.

5.    
          Lee acknowledges that the facts in respect of which this Release is made may
          prove to be other than or different from the facts in that connection now known
          or believed by Lee to be true. Lee accepts and assumes the risk of the facts
          being different and agrees that this Release shall be in all respects
          enforceable and not subject to termination, rescission, or variation by
          discovery of any differences in facts.

6.    
          Lee agrees to keep the terms of this Release strictly confidential and will not
          disclose any information with respect to this Release to any one with the
          exception of his legal or financial advisors, unless compelled to do so by law
          or court order.

7.    
          Lee agrees he will not make any statement or publish any document which is
          defamatory about or concerning MDSI or any person who holds or has held the
          position of officer or director of MDSI.

8.    
          It is agreed that the consideration and this Release are not admissions of
          liability.

9.    
          Lee acknowledges that this Release has been executed voluntarily after receiving
          legal advice.

10.    
          The Release is given voluntarily for the purposes of making a full and final
          settlement of all of Lees claims whatsoever arising against MDSI.

11.    
          The terms of the Release are contractual and not recitals.

12.    
          This Release is governed by the laws of British Columbia.

Dated
at Richmond, the 23rd day of September 2004.

|                                                  |   |                      
|------------------------------------------------- | - | ---------------------
|SIGNED, SEALED AND DELIVERED by Joo-Hyung (Tommy) | ) |                      
|Lee in the presence of                            | ) |                      
|                                                  | ) |                      
|/s/ Ron Toffolo                                   | ) | /s/ Joo-Hyung Lee    
|Witness                                           | ) | Joo-Hyung (Tommy) Lee