<PAGE>   1

                                                                    EXHIBIT 10.1



                              EMPLOYMENT AGREEMENT



eLoyalty Corporation, a Delaware corporation ("eLoyalty"), and Steven C. Pollema
("Employee") enter into this Employment Agreement (this "Agreement") effective
as of June 1, 2001 (the "Effective Date").

     In consideration of the agreements and covenants contained in this
Agreement, eLoyalty and Employee agree as follows:

     1.   EMPLOYMENT DUTIES: eLoyalty shall employ Employee as a Senior Vice
President of Operations. Employee shall report to eLoyalty's chief executive
officer and shall have the normal responsibilities, duties and authorities
inherent in his position. Employee's principal place of employment shall be at
eLoyalty's corporate headquarters. Employee shall perform faithfully the duties
assigned to Employee to the best of Employee's ability and shall devote
Employee's full and undivided business time and attention to the transaction of
eLoyalty's business.

     2.   TERM OF EMPLOYMENT: The term of employment ("Term of Employment")
covered by this Agreement shall commence as of June 11, 2001 (the "Employment
Date") and continue until terminated in accordance with the terms hereof.
Employee agrees that after the Effective Date and prior to the Employment Date,
he shall provide eLoyalty with such consulting services as eLoyalty may
reasonably request at no additional compensation; provided, however, that such
services shall not interfere with Employee's other employment obligations.

     3.   TERMINATION: This Agreement may be terminated as follows:

          (a)  Involuntary Termination. eLoyalty may terminate Employee's
     employment for any reason by giving Employee written notice of termination,
     which termination shall be effective as of such date specified in the
     notice (the "Termination Date"), provided that, except in cases of Serious
     Misconduct (which shall be subject to the notice and cure provisions set
     forth in paragraph 3(b)), such Termination Date shall be at least 90 days
     after the notice date and, in any event, no earlier than the six-month
     anniversary of the Effective Date. Until such Termination Date, Employee
     shall make a good faith effort to satisfy those professional obligations
     requested to be performed by eLoyalty, which may include transferring
     duties and assisting in the orderly transition of client responsibilities,
     including meeting with clients and returning all eLoyalty and client
     confidential material. If Employee's employment with eLoyalty is terminated
     by eLoyalty for any reason other than Serious Misconduct, Employee shall
     receive:
<PAGE>   2

               (i) a lump sum payment within seven days of the Termination Date
          equal to the sum of Employee's annual base salary as in effect on the
          Termination Date, plus an amount equal to the average annual bonus
          earned during the two years immediately preceding the Termination Date
          (for any year prior to 2001, the bonus earned shall be deemed to be
          equal to Employee's base salary on the Effective Date); and

               (ii) with respect to any stock options outstanding on the
          Termination Date, accelerated vesting of the portion of such stock
          options that would otherwise vest and become exercisable as of the day
          prior to the first anniversary of the Termination Date, as provided in
          the respective applicable stock option agreements.

          (b)  Serious Misconduct. eLoyalty may terminate Employee's employment
     immediately upon written notice and with no continuation of salary,
     benefits or option vesting if Employee engages in "Serious Misconduct." For
     purposes of this Agreement, "Serious Misconduct" means embezzlement or
     misappropriation of corporate funds, conviction of a felony, material
     breach of this Agreement or willful and continued failure to substantially
     perform his duties or responsibilities. Prior to any termination for
     Serious Misconduct, eLoyalty shall provide the Employee with fifteen days'
     notice and an opportunity to be heard at a meeting of the Board of
     Directors, and an opportunity to cure a willful failure to perform his
     duties and responsibilities or, to the extent curable, a material breach of
     this Agreement.

          (c)  Constructive Discharge. A Constructive Discharge by eLoyalty
     shall be treated for all purposes of this Agreement as a termination by
     eLoyalty for a reason other than Serious Misconduct and shall entitle
     Employee to the benefits set forth in paragraph 3(a) above. If (x) Employee
     provides written notice to eLoyalty of the occurrence of Good Reason (as
     defined below) within a reasonable time after Employee has knowledge of the
     circumstances constituting Good Reason, which notice shall specifically
     identify the circumstances which Employee believes constitute Good Reason;
     (y) eLoyalty fails to correct the circumstances within 15 days after such
     notice; and (z) the Employee resigns within ninety days after the date of
     delivery of the notice referred to in clause (x) above, then Employee shall
     be considered to have been subject to a Constructive Discharge by eLoyalty.
     For purposes of this Agreement, "Good Reason" shall mean the occurrence of
     any of the following events without Employee's consent:

          (i) a reduction by eLoyalty in Employee's base salary, a reduction in
     his target bonus to less than 100% of base salary; or a material and
     substantial reduction in Employee's benefits other than a reduction which
     is applied generally to employees or other senior executives.

          (ii) diminutions in the Employee's duties or responsibilities which
     ARE material in the aggregate;


                                       2

<PAGE>   3

          (iii) a change in Employee's reporting relationship such that
     Employee no longer reports directly to the chief executive officer of
     eLoyalty or, if eLoyalty is acquired by any other entity, the chief
     executive officer of the ultimate parent of eLoyalty;

          (iv) a relocation of eLoyalty's corporate offices or Employee's
     principal place of employment to a location outside of Lake, Cook and
     DuPage counties;

          (v) the failure of eLoyalty to obtain a satisfactory agreement from
     any successor to all or substantially all of the assets or business of
     eLoyalty to assume and agree to perform this Agreement within 15 days after
     a merger, consolidation, sale or similar transaction; or

          (vi) a material breach of this Agreement by eLoyalty.

          (d) Resignation. Employee may terminate his employment upon giving
     eLoyalty 90 days written notice. eLoyalty may make the termination
     effective at any time within the 90 day notice period. During this period
     Employee shall make a good faith effort to satisfy those professional
     obligations requested to be performed by eLoyalty, which may include
     transferring duties and assisting in the transition of client
     responsibilities, including meeting with clients.

          (e)  Disability. eLoyalty or Employee may terminate Employee's
     employment at any time by reason of Employee's Disability. A termination of
     Employee's employment by reason of Disability shall be treated for all
     purposes of this Agreement as a termination by eLoyalty for a reason other
     than Serious Misconduct and shall entitle Employee to the benefits set
     forth in paragraph 3(a)(i) above. For purposes of this Agreement,
     "Disability" means Employee's inability, due to physical or mental
     incapacity, to substantially perform his duties and responsibilities
     contemplated by this Agreement for a period of not less than 180 days. In
     the event of a dispute as to whether Employee is disabled, the
     determination shall be made by a licensed medical doctor selected by the
     eLoyalty and agreed to by Employee. If the parties cannot agree on a
     medical doctor, each party shall select a medical doctor and the two
     doctors shall select a third who shall be the approved medical doctor for
     this purpose. Employee agrees to submit to such tests and examinations as
     such medical doctor shall deem appropriate.

          (f) Death. A termination of Employee's employment by reason of death
     shall be treated for all purposes of this Agreement as a termination by
     eLoyalty for a reason other than Serious Misconduct and shall entitle
     Employee's estate to the benefits set forth in paragraph 3(a)(i) above.

          4. SALARY: As compensation for Employee's services, eLoyalty shall pay
     Employee a base salary at the annual rate listed on Exhibit A to this
     Agreement. Employee's base salary shall be subject to annual review and
     may, by mutual agreement of eLoyalty and Employee, be adjusted from that
     listed in Exhibit A according to Employee's responsibilities, capabilities
     and performance during the preceding year.


                                       3
<PAGE>   4

       5. BONUSES:

          (a)  In order to facilitate Employee's acquisition of shares of
     eLoyalty common stock in accordance with paragraph 6(a) below, Employee
     shall receive a sign-on bonus in the amount set forth on Exhibit A to this
     Agreement in the form of a loan evidenced by, and subject to the terms and
     conditions of, a promissory note (the "Promissory Note"). The loan proceeds
     will be distributed as soon as practicable after eLoyalty has received
     Employee's signed Promissory Note. Provided that Employee remains in the
     employ of eLoyalty, the loan will be fully forgiven in substantially equal
     monthly installments over the 24-month period following the date the loan
     is made. The outstanding balance of the loan will be fully forgiven upon
     the earliest to occur of (i) any termination of employment by eLoyalty for
     reasons other than Serious Misconduct; (ii) any termination of employment
     by Employee pursuant to a Constructive Discharge; (iii) any termination of
     employment by eLoyalty or Employee for Employee's Disability; (iv)
     Employee's death; or (v) a Change in Control of eLoyalty as defined in the
     eLoyalty Corporation 1999 Stock Incentive Plan, as amended and restated
     (the "Incentive Plan"). Employee will be obligated to repay the remaining
     balance of his loan with accrued interest thereon in accordance with the
     terms of the Promissory Note if his employment terminates on account of his
     resignation other than pursuant to a Constructive Discharge or eLoyalty's
     termination of his employment for Serious Misconduct before the expiration
     of such 24-month period.

          (b)  In addition, Employee shall be eligible to receive a performance
     bonus under this paragraph (b) based upon the attainment of objectives
     determined in accordance with and subject to the terms and conditions of
     eLoyalty's then applicable discretionary bonus program. Employee's target
     bonus for the 2001 calendar year shall equal 100% of his annual base
     salary, prorated based upon the portion of calendar year 2001 remaining
     from the Effective Date through December 31, 2001. In no event will the
     Employee's actual bonus for each of the calendar quarters ending on
     September 30, 2001, December 31, 2001 and March 31, 2002 be less than
     $63,750, payable no later than forty-five days after the end of each
     quarter. As soon as practicable after the Effective Date, eLoyalty shall
     make a lump sum payment to Employee in the amount of $100,000 as an advance
     against such guaranteed bonus payments. Such advance shall be offset
     against the final payments of such guaranteed bonus. In the event that
     Employee's employment is terminated by Employee pursuant to a Constructive
     Discharge or because of death or Disability, or by eLoyalty for any reason
     other than Serious Misconduct, this advance shall not have to be repaid,
     but shall be offset against the amounts otherwise payable under paragraph
     3(a), 3(c), 3(e) or 3(f), as the case may be. For calendar years after
     2001, Employee's target bonus for any year shall not be less than 100% of
     his base salary for such year and, subject to approval of the Compensation
     Committee of eLoyalty's Board of Directors, shall be based upon objectives
     mutually agreed upon by Employee and eLoyalty's Chief Executive Officer.
     The timing of any bonus payments for calendar years after 2001 (other than
     the guaranteed bonus payment for the first quarter of 2002) shall be in
     accordance with the schedule set by eLoyalty for its Senior
     Vice-Presidents.


                                       4

<PAGE>   5


     6.   ELOYALTY STOCK:

          (a)  Purchase of Stock. Employee shall acquire shares of eLoyalty
common stock for an aggregate purchase price in the amount set forth on Exhibit
A in open market transactions on or before the 90th day following the Employment
Date.

          (b)  Restricted Stock. As of the Employment Date, Employee shall be
awarded the number of shares of common stock of eLoyalty set forth on Exhibit A
to this Agreement. The shares shall be awarded as Restricted Stock under and in
accordance with the provisions of the Incentive Plan, and will be subject, in
all respects, to the terms and conditions of the Incentive Plan. In addition,
the award of such Restricted Stock will be evidenced by, and subject to the
terms and conditions of, a Restricted Stock Award Agreement in the form attached
hereto (the "Restricted Stock Agreement") reflecting the vesting schedule set
forth on Exhibit A hereto, as well as the other customary terms and conditions
applicable to awards under the Incentive Plan.

          (c)  Stock Options. As of the Effective Date, Employee shall be
granted a nonqualified stock option (the "Option") to purchase the number of
shares of common stock of eLoyalty set forth on Exhibit A to this Agreement. The
Option shall be granted under and in accordance with the provisions of the
Incentive Plan, and will be subject, in all respects, to the terms and
conditions of the Incentive Plan. In addition, the Option will be evidenced by,
and subject to the terms and conditions of, a Stock Option Agreement in the form
attached hereto (the "Option Agreement") reflecting the vesting schedule set
forth on Exhibit A hereto, as well as the other customary terms and conditions
applicable to options granted under the Incentive Plan.

     7. EMPLOYEE BENEFITS: During the Term of Employment, Employee shall be
entitled to participate in such employee benefit plans, including eLoyalty's
401(k) plan and deferred compensation plan and its group life and health
insurance and other medical benefits, and shall receive all other fringe
benefits, including 22 paid vacation days, as eLoyalty may make available
generally to its Senior Vice Presidents. In the event of a termination of
employment by eLoyalty for reasons other than Serious Misconduct or Employee's
Constructive Discharge, Employee shall continue to receive group life and health
insurance and other medical benefits and continued deferral of income deferred
prior to his termination of employment through the first anniversary of such
termination on the same basis as an active employee.

     8. BUSINESS EXPENSES: eLoyalty shall reimburse Employee for all reasonable
and necessary business expenses (including mobile phone expenses) incurred by
Employee in performing Employee's duties in accordance with eLoyalty's expense
reimbursement policies. Employee shall provide eLoyalty with supporting
documentation sufficient to satisfy reporting requirements of the Internal
Revenue Service and eLoyalty. eLoyalty's determination as to reasonableness and
necessity shall be final.


                                       5

<PAGE>   6


     9. NONCOMPETITION AND NONDISCLOSURE: Employee acknowledges that the
successful development and marketing of eLoyalty's professional services and
products require substantial time and expense. Such efforts generate for
eLoyalty valuable and proprietary information ("Confidential Information") which
gives eLoyalty a business advantage over others who do not have such
information. Confidential Information of eLoyalty and its clients and prospects
includes, but is not limited to, the following: business strategies and plans;
proposals; deliverables; prospects and customer lists; methodologies; training
materials; computer software; and other Trade Secrets (as defined in paragraph
11) of eLoyalty, its customers and its vendors. Employee acknowledges that
during the Term of Employment, Employee will obtain knowledge of such
Confidential Information. Accordingly, Employee agrees to undertake the
following obligations which Employee acknowledges to be reasonably designed to
protect eLoyalty's legitimate business interests without unnecessarily or
unreasonably restricting Employee's post-employment opportunities:

          (a)  Upon termination of the Term of Employment for any reason,
     Employee shall return all eLoyalty property, including but not limited to
     computer programs, files, notes, records, charts, or other documents or
     things containing in whole or in part any of eLoyalty's Confidential
     Information.

          (b) During the Term of Employment and subsequent to termination,
     Employee agrees to treat all such Confidential Information as confidential
     and to take all necessary precautions against disclosure of such
     information to third parties during and after Employee's employment with
     eLoyalty. Employee shall refrain from using or disclosing to any person,
     without the prior written approval of eLoyalty's Chief Executive Officer,
     any Confidential Information unless at that time the information has become
     generally and lawfully known to eLoyalty's competitors.

          (c)  Without limiting the obligations of paragraph 9(b) during the
     Noncompetition Period (as defined below), Employee shall not, for
     Employee's self or as an agent, partner or employee of any person, firm or
     corporation, engage in or be employed by any entity which engages in the
     practice of consulting or related services with respect to the customer
     relationship management ("CRM") area which is competitive with the services
     provided by eLoyalty or which, on the date of Employee's termination of
     employment, senior management of eLoyalty is actively planning for eLoyalty
     to provide to its customers; provided, however, that the foregoing shall
     not preclude the Employee from employment with any entity which provides
     consulting or related services in the CRM area if (i) services in the CRM
     area do not constitute such entity's principal business, and (ii) the
     Employee does not have duties, responsibilities or authorities with respect
     to the portion of such entity's business which relates to the CRM area. For
     purposes of this paragraph, the "Noncompetition Period" means (i) the
     six-month period following Employee's termination of employment either by
     eLoyalty for reasons other than Serious Misconduct or by Employee pursuant
     to a Constructive Discharge or (ii) the one-year period following
     Employee's termination of employment by eLoyalty for Serious Misconduct or
     by Employee for any reason other than pursuant to a Constructive Discharge.

                                       6
<PAGE>   7


          (d) During a one year period immediately following Employee's
     termination of employment for any reason, Employee shall not induce or
     assist in the inducement of any eLoyalty employee away from eLoyalty's
     employ or from the faithful discharge of such employee's contractual and
     fiduciary obligations to serve eLoyalty's interests with undivided loyalty.

         Notwithstanding anything contained in this paragraph 9 to the contrary,
Employee shall not be prevented from: (a) owning up to 5% of the outstanding
stock of any corporation regularly traded on a national securities exchange or
in any over-the-counter market; or (b) retaining any shares of stock in any
corporation which Employee owned prior to the date of this Agreement.

     10. REMEDIES: Employee recognizes and agrees that a breach of any or all
of the provisions of paragraph 9 will constitute immediate and irreparable harm
to eLoyalty's business advantage, including but not limited to eLoyalty's
valuable business relations, for which damages cannot be readily calculated and
for which damages are an inadequate remedy. Accordingly, Employee acknowledges
that eLoyalty shall therefore be entitled to an order enjoining any further
breaches by the Employee.

     11. AGREEMENTS REGARDING PRIOR EMPLOYMENT.

          (a) As used in this Agreement "Trade Secret" means the whole or any
portion of the property of a person (the "Owner") consisting of any information,
pattern, compilation, data, list, document, memorandum, process, program,
device, method, technique, formula or improvement, whether patentable or not,
relating to the business of the Owner (i) of which Employee became aware as a
consequence of or through his relationship with the Owner; (ii) which derives
independent economic value, actual or potential, form not being generally known
to the public or to other persons who can obtain economic value from its
disclosure or use; and (iii) which is the subject of efforts that are reasonable
under the circumstances to maintain its secrecy. Assuming these three criteria
are met, Trade Secrets shall include information relating to the financial
affairs, customers, employees, employees' compensation, research, development,
inventions, existing and future products and services, plans and designs, and
marketing of the Owner. Trade Secrets shall not include any data or information
that has been voluntarily disclosed to the public by the Owner or become
generally known to the public.

          (b) To induce eLoyalty to enter into this Agreement, Employee
     represents to eLoyalty that Employee has not disclosed to eLoyalty,
     directly or indirectly, any Trade Secret of any former employer and that
     Employee does not believe that the performance of his duties and
     responsibilities arising from this Agreement will require his reliance on,
     use of or disclosure of any Trade Secret of any former employer.


                                       7
<PAGE>   8

          (c) Employee and eLoyalty hereby covenant to each other that neither
     eLoyalty nor Employee intends to obtain, learn, disclose or use any Trade
     Secret of any former employer of Employee. Employee will not disclose to
     eLoyalty any Trade Secret of a former employer, and eLoyalty will not
     request Employee to make any such disclosure.

     12. INTELLECTUAL PROPERTY: During the Term of Employment, Employee shall
disclose to eLoyalty all ideas, inventions and business plans which Employee
develops during the course of Employee's employment with eLoyalty which relate
directly or indirectly to eLoyalty's business, including but not limited to any
computer programs, processes, products or procedures which may, upon
application, be protected by patent or copyright. Employee agrees that any such
ideas, inventions or business plans shall be the property of eLoyalty (and in
furtherance thereof hereby assigns to eLoyalty any and all rights and interests
of Employee therein and thereto) and that Employee shall, at eLoyalty's request
and cost (including reimbursement of Employee's expenses and, if Employee is no
longer in the employ of eLoyalty, reasonable per diem compensation to Employee),
provide eLoyalty with such assurances as is necessary to secure a patent or
copyright.

     13. ASSIGNMENT: Employee acknowledges that the services to be rendered
pursuant to this Agreement are unique and personal. Accordingly, Employee may
not assign any of Employee's rights or delegate any of Employee's duties or
obligations under this Agreement. eLoyalty may assign its rights, duties or
obligations under this Agreement to a subsidiary or affiliate of eLoyalty with
the consent of Employee. This Agreement shall be binding upon and inure to the
benefit of any purchaser or transferee of a majority of eLoyalty's outstanding
capital stock or a purchaser or transferee of all, or substantially all, of the
assets of eLoyalty.

     14. NOTICES: All notices hereunder shall be in writing, except for notice
of termination of employment, which may be oral if confirmed in writing within
14 days. Notices intended for eLoyalty shall be sent by registered or certified
mail addressed to it at 150 Field Drive, Suite 250, Lake Forest, Illinois 60045
or its current principal office, and notices intended for Employee shall be
either delivered personally to Employee or sent by registered or certified mail
addressed to Employee's last known address.

     15.ENTIRE AGREEMENT: This Agreement and Exhibit A attached hereto, together
with the other plans, programs and agreements referred to herein, constitute the
entire agreement between eLoyalty and Employee with respect to the subject
matter hereof. Neither Employee nor eLoyalty may modify this Agreement by oral
agreements, promises or representations. The parties may modify this Agreement
only by a written instrument signed by the parties.

     16. WAIVER OF BREACH: No waiver by any party hereto of a breach of any
provision of this Agreement by any other party, or of compliance with any
condition or provision of this Agreement to be performed by such other party,
will operate or be construed as a waiver of any subsequent breach by such other
party of any similar or dissimilar provisions and conditions at the same or any
prior or subsequent time. The failure of any party hereto to take any action by
reason of such breach will not deprive such party of the right to take action at
any time while such breach continues.




                                        8
<PAGE>   9

     17. APPLICABLE LAW:  This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois.

     18. BINDING ARBITRATION: Employee and eLoyalty agree that all claims or
disputes relating to Employee's employment with eLoyalty or the termination of
such employment, and any and all other claims that Employee might have against
eLoyalty, any eLoyalty director, officer, employee, agent, or representative,
and any and all claims or disputes that eLoyalty might have against Employee
(except for any claims under Paragraph 9 of this Agreement) shall be resolved
under the Expedited Commercial Rules of the American Arbitration Association. If
either party pursues a claim and such claim results in an Arbitrator's decision,
both parties agree to accept such decision as final and binding. eLoyalty and
Employee agree that any litigation under Paragraph 9 or 10 of this Agreement
shall be brought in the Circuit Court for Cook County, Illinois.

     19. SEVERABILITY: Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.

    20. ACKNOWLEDGEMENT:  Employee acknowledges that Employee has read,
understood and accepts the provisions of this Agreement.


eLoyalty Corporation                        Steven C. Pollema



By: /s/ KELLY D. CONWAY                  /s/ STEVEN C. POLLEMA
   ---------------------------           ------------------------
         Kelly D. Conway
President and Chief Executive Officer




                                       9
<PAGE>   10


                                    EXHIBIT A


EMPLOYEE:                  Steven C. Pollema

POSITION:                  Senior Vice President

BASE SALARY:               $300,000 per annum

SIGN-ON BONUS/LOAN:        $250,000

EFFECTIVE DATE:            June 1, 2001

EMPLOYMENT DATE:           June 11, 2001

STOCK PURCHASE:            $150,000

RESTRICTED STOCK:

                           Award as of the Employment Date, under the Incentive
                           Plan, of 50,000 restricted shares of eLoyalty
                           Corporation common stock, having the following
                           vesting schedule, subject to the terms and conditions
                           of the Incentive Plan and the applicable Restricted
                           Stock Award Agreement:

                           Vesting Schedule: The Award shall vest in monthly
                           increments on the first day of each month over the
                           sixty (60) consecutive month period beginning on the
                           first day of the month following the month in which
                           the Employment Date occurs (subject to Employee's
                           continued employment with eLoyalty). The first 20
                           such monthly increments shall be for 834 shares each.
                           The final 40 such monthly increments shall be for
                           833 shares each. The Award shall be subject to
                           accelerated vesting (i) as to a portion of the
                           shares, in accordance with the terms set forth in the
                           attached Restricted Stock Award Agreement, upon a
                           termination of Employee's employment within the first
                           year of the Agreement by eLoyalty for reasons other
                           than Serious Misconduct or by Employee by reason of
                           Constructive Discharge, or (ii) as to all shares,
                           upon a change in control of eLoyalty or in the event
                           of death or termination of employment by reason of
                           Disability or retirement with eLoyalty's consent in
                           accordance with the terms set forth in the attached
                           Restricted Stock Award Agreement.


                                  Exhibit A-1

<PAGE>   11

STOCK OPTION:              Initial grant as of the Effective Date, under the
                           Incentive Plan, of a nonqualified option to purchase
                           200,000 shares of eLoyalty Corporation common stock,
                           having the following exercise price and vesting
                           schedule, subject to the terms and conditions of the
                           Incentive Plan and the applicable Option Agreement:

                           Exercise Price:  Closing price per share of eLoyalty
                           common stock on the Effective Date.

                           Vesting Schedule: The Option shall become vested and
                           exercisable with respect to 50,000 shares (25% of the
                           shares covered by the Option) on the last day of the
                           month in which the first anniversary of the Effective
                           Date occurs (subject to Employee's continued
                           employment with eLoyalty). The remaining 150,000
                           shares covered by the Option shall vest and become
                           exercisable in equal monthly increments (each equal
                           to 1/36 of such remaining shares) on the last day of
                           each month over the thirty-six (36) consecutive
                           month period beginning in the month following the
                           month in which the first anniversary of the Effective
                           Date occurs (subject to Employee's continued
                           employment with eLoyalty). The option shall be
                           subject to accelerated vesting (i) as to a portion of
                           the option, in accordance with the terms set forth in
                           the attached option agreement, upon a termination of
                           Employee's employment by eLoyalty for reasons other
                           than Serious Misconduct or by Employee by reason of
                           Constructive Discharge (with accelerated vesting as
                           to the entire option if any such employment
                           termination occurs during the first year of
                           Employee's employment) or upon a change in control of
                           eLoyalty or (ii) as to the entire option, in the
                           event of Employee's death or termination of his
                           employment by reason of Disability, in accordance
                           with the terms set forth in the attached option
                           agreement.


     /s/ STEVEN C. POLLEMA                 eLoyalty Corporation
--------------------------------
       Steven C. Pollema

                                           By: /s/ KELLY D. CONWAY
                                              ---------------------------
                                                    Kelly D. Conway
                                                  President and Chief
                                                   Executive Officer



                                  Exhibit A-2