Exhibit
10.15  August
14, 2003  Mr. John Mutch
P.O. Box 1590
Rancho Santa Fe, CA 92067  Dear John:  On
behalf of the Board of Directors of Peregrine Systems, Inc. (PSI), we would
like to offer you the position of President and Chief Executive Officer of PSI,
effective as of August 18, 2003 (the Commencement Date), subject to the
following terms and conditions:  1.TITLE;
BASE SALARY.  Effective as of
the Commencement Date, you will be employed as President and Chief Executive
Officer of PSI.  You will report to the
Board of Directors of PSI (the Board). Your base salary will be at the rate
of $400,000 annually, effective as of the Commencement Date.  So long as you serve as PSIs Chief
Executive Officer, PSI shall include you on the slate of directors nominated
for election at each annual meeting of PSI stockholders.  2.EMPLOYMENT
TERM.  The term of your
employment as President and Chief Executive Officer under this letter agreement
(the Employment Term) will commence on the Commencement Date and end when it
is terminated in accordance with Section 6.  3.BONUS.  You will be eligible for a target bonus of
$350,000 for each fiscal year during the Employment Term (prorated for fiscal
2004), based on attainment of reasonable bonus objectives determined by the
Board in consultation with you, to be paid in the first quarter of the
subsequent fiscal year.  4.BENEFITS.  You will be eligible to participate in PSIs
employee benefit plans of general application, including, without limitation,
those plans covering medical, disability and life insurance in accordance with
the rules established for individual participation in any such plan and under
applicable law. You will be eligible for vacation and sick leave in accordance
with PSI polices in effect during the term of this letter agreement and will
receive such other benefits as PSI generally provides to its other employees of
comparable position and experience. 
However, you will in any event be eligible for at least three weeks of
paid vacation during your first year of employment and at least four weeks of
paid vacation during each subsequent year of employment.  5.OPTIONS.  The Compensation Committee of the Board of
Directors has approved that you be granted an option to purchase up to 350,000
shares of PSIs common stock (the Options), subject to the execution of this
letter agreement and your executing a  
   stock option grant agreement
consistent with the terms and conditions of the PSI option plan under which the
Options are granted and this letter agreement. The date of grant of the Options
will be the Commencement Date and the exercise price per share of the Options
will be the fair market value of PSIs common stock on the Commencement Date as
determined under such PSI option plan. 
The right to exercise the Options will vest in 48 equal monthly
installments beginning one month from the Commencement Date.  In the case of Termination without Cause,
Termination for Death or Disability or Termination for Good Reason (all as
defined below), all vested Options will be exercisable for 12 months following
the date of termination.  In the case of
termination of employment for any other reason, all vested Options will be
exercisable for at least 3 months following the date of termination.  Notwithstanding any provisions of the PSI
option plan or the stock option grant agreement evidencing the Options to the
contrary, if a Change in Control occurs, then the vesting and exercisability of
all shares of common stock issuable pursuant to the Options will be accelerated
in full.  A Change in Control means:  (a)the
consummation of a merger or consolidation of PSI with or into another entity or
any other corporate reorganization, if persons who were not stockholders of PSI
immediately prior to such merger, consolidation or other reorganization own
immediately after such merger, consolidation or other reorganization 50% or
more of the voting power of the outstanding securities of each of (i) the
continuing or surviving entity; and (ii) any direct or indirect parent corporation
of such continuing or surviving entity;  (b)the
sale, transfer or other disposition of all or substantially all of the assets
of PSI;  (c)a
change in the composition of the Board, as a result of which fewer than 50% of
the incumbent directors are directors who either:  (i)Had
been directors of PSI immediately after PSIs emergence from bankruptcy
protection on August 7, 2003 or had been designated to serve on the Board
during the 90-day period after emergence pursuant to the terms of the confirmed
plan of reorganization (the Original Directors); or  (ii)Were
appointed to the Board, or nominated for election to the Board, with the
affirmative votes of at least a majority of the aggregate of (A) the Original
Directors who were in office at the time of their appointment or nomination and
(B) the directors whose appointment or nomination was previously approved in a
manner consistent with this Paragraph (ii); or  2 
   (d)Any
transaction as a result of which any person (excluding any person who was a
stockholder of PSI immediately after emergence from bankruptcy protection on
August 7, 2003) is the beneficial owner (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended), directly or indirectly, of
securities of PSI representing at least 35% of the total voting power
represented by PSIs then outstanding voting securities.  For purposes of this Subsection (d), the
term person shall have the same meaning as when used in sections 13(d) and
14(d) of such Act but shall exclude (i) a trustee or other fiduciary holding
securities under an employee benefit plan of PSI or of a parent or subsidiary
of PSI and (ii) a corporation owned directly or indirectly by the stockholders
of PSI in substantially the same proportions as their ownership of the common
stock of PSI.  6.TERMINATION.  Your employment with PSI may be terminated
by you or by PSI at any time for any reason as follows:  (a)You
may terminate your employment upon written notice to the Board at any time in
your discretion (Voluntary Termination);  (b)PSI
may terminate your employment upon written notice to you at any time following
a determination by the Board that there is Cause as defined below, for such
termination (Termination for Cause);  (c)PSI
may terminate your employment upon written notice to you at any time in the
sole discretion of the Board without a determination that there is Cause for
such termination (Termination without Cause);  (d)Your
employment will automatically terminate upon your death or upon your Disability
(as defined below) (Termination for Death or Disability); or  (e)You
may terminate your employment upon written notice to the Board at any time
following a determination by you that there is Good Reason (as defined below)
for such termination (Termination for Good Reason).  For
purposes of this letter agreement, the term Disability shall mean your
inability to perform your job responsibilities for a period of 180 consecutive
days or 180 days in the aggregate in any 12-month period.  For purposes of this letter agreement,
Cause means (i) gross negligence or willful misconduct in the performance of
your duties to PSI (other than as a result of a Disability); (ii) repeated and
continued failure to perform your duties and responsibilities as a PSI employee
(including but not limited to your compliance with any written policy of PSI)
in good faith after having a reasonable opportunity to cure such failure upon
receiving specific written notice of such failure from PSI; (iii) commission of
any act of fraud with respect to PSI; or (iv) conviction of a felony or a crime
involving moral turpitude if such felony or crime caused material harm to the
business and affairs of PSI.  No act or
failure to act by you shall be considered willful if done or omitted by you  3 
   in good faith with reasonable
belief that your action or omission was in the best interests of PSI. For
purposes of this letter agreement, Good Reason shall mean (i) a significant
reduction of your duties, title, position or responsibilities relative to your
duties, title, position or responsibilities in effect immediately prior to such
reduction (including a material change in your reporting structure, which shall
include, but not be limited to, your no longer reporting to the Board) that is
effected without your consent or agreement; (ii) a substantial reduction,
without good business reasons, of the facilities or perquisites available to
you immediately prior to such reduction if such reduction is effected without
your consent or agreement; (iii) a reduction of your base salary and target
bonus as in effect immediately prior to such reduction if such reduction is
effected without your consent or agreement (other than any such reduction that
is effected on substantially a company-wide basis in order to reduce PSIs
operating expenses); or (iv) the relocation of your primary office at PSI to a
facility or location that is more than fifty (50) miles away from your primary
office location immediately prior to such relocation, if such relocation is
effected without your consent or agreement.  7.SEPARATION
BENEFITS.  Upon termination
of your employment with PSI for any reason, you will receive payment for all
salary and unpaid vacation accrued to the date of your termination of
employment.  Your benefits will be
continued under PSIs then existing benefit plans and policies for so long as
provided under the terms of such plans and policies and as required by
applicable law.  Under certain
circumstances, you will also be entitled to receive severance benefits as set
forth below, but you will not be entitled to any other compensation, award or
damages with respect to your employment or termination.  (a)In the
event of your Voluntary Termination or Termination for Cause, you will not be
entitled to any cash severance benefits or additional vesting of shares of
stock options.  (b)Subject
to your compliance with Section 9, in the event of your Termination without
Cause, Termination for Death or Disability or Termination for Good Reason; (i)
at any time during the first 12 months following the Commencement Date (the
First Year), you will be entitled to a severance payment equal to your base salary
plus an amount equal to the maximum amount of your target bonus; or (ii) at any
time after the First Year, you will be entitled to a severance payment equal to
two (2) times your base salary plus an amount equal to two (2) times your
target bonus, in either case payable within five (5) days after the effective
date of your termination; provided, that any severance payable hereunder in the
event of your Termination for Death or Disability shall be reduced by the
proceeds received by you or your heirs pursuant to insurance policies paid for
by PSI.  In addition, in the event of
your Termination without Cause or Termination for Good Reason at any time after
the First Year, all Options that would have vested during the 12 months
following the date of termination shall become immediately exercisable on such
date.  4 
   (c)In the
event of your Termination for Death or Disability, all Options that would have
vested during the 12 months following the date of termination shall become
immediately exercisable on such date.  (d)In the
event of your Termination without Cause, Termination for Good Reason or
Termination for Death or Disability, PSI will reimburse you for any verified
payments that you actually make pursuant to your rights under COBRA (as defined
below) in order to continue your coverage under PSIs health and medical
insurance benefit plans during the Continuation Period (as defined below).  In addition, during (and only during) the
Continuation Period, PSI will, at its expense continue your coverage under any
life insurance benefits in which you are participating in your capacity as a
PSI employee immediately prior to the date your employment terminated, to the
extent permitted under any such life insurance benefit plan(s) or policy(ies)
or pursuant to any riders thereto that PSI may obtain using commercially
reasonable efforts and without increasing PSIs cost to maintain such plan(s)
or policy(ies) by more than thirty percent (30%).  For purposes of this letter agreement, the term COBRA shall
mean the provisions of Section 4980B of the Internal Revenue Code of 1986, as
amended, adopted as part of the Consolidated Omnibus Budget Reconciliation Act,
which allow former employees of an employer to continue to receive health and
medical benefits, at their expense, for a specified time period.  For purposes of this letter agreement, the
term Continuation Period shall mean that time period beginning on the date
your employment is terminated and ending upon the earlier to occur of (i)
eighteen (18) months after such date, (ii) the first date on or after such date
on which you commence employment with any other employer who provides you with
health and medical insurance benefits or (iii) the first date on which you
cease to be eligible under COBRA to continue your coverage under PSIs health
and medical insurance benefit plans.  (e)Subject
to your compliance with Section 9, in the event of a Change of Control, you
will be entitled to a severance payment equal to three (3) times your base
salary plus an amount equal to three (3) times your target bonus, payable on
the effective date of the Change of Control. In the event of your termination
by PSI or any successor corporation for any reason in connection with or during
the 12-month period following a Change of Control, you will only be entitled to
the payment set forth in this Subsection (e) (for purposes of clarity, you will
not be entitled to any additional severance payment pursuant to Subsection
(b)).  8.280G
PAYMENT.  (a)In the
event any of the benefits provided for in this Agreement or any other benefits
approved at any time by the Board or the Compensation Committee of the Board
and otherwise payable to your (including stock options) constitute parachute payments
within the meaning of Section 280G of the Internal Revenue Code of 1986, as
amended (the Code), and will be subject to the excise tax imposed by Section
4999 of the Code, then, subject to the provisions of Section 8(d) below, you
shall receive from PSI (A) a  5 
   cash payment sufficient to pay such
excise tax, and (B) an additional payment sufficient to pay the excise tax and
federal and state income and employment taxes arising from the payments made by
PSI to you pursuant to this sentence.  (b)Unless
PSI and you otherwise agree in writing, the determination of your excise tax
liability and the amount required to be paid to you by PSI under this Section 8
shall be made in writing by PSIs independent accountants (the Accountants),
and the amounts to be paid to you by PSI under this Section 8 will be paid to
you within thirty (30) days after the Accountants have finally determined that
amount as provided herein (or such shorter time after the Accountants have
finally determined that amount as may be necessary in order for you to timely
pay any withholding or estimated tax obligations arising from your receipt of
any payment under this Section 8).  For
purposes of making the calculations required by this Section 8, the Accountants
may make reasonable assumptions and approximations concerning applicable taxes
and may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code.  PSI and you shall furnish to the Accountants such information and
documents as the Accountants may reasonably request in order to make a
determination under this Section 8.  PSI
shall bear all costs the Accountants may reasonably incur in connection with
any calculations contemplated by this Section 8.  (c)In the
event that the Internal Revenue Service (IRS) determines that the amount of
excise tax payable by you as described above in this Section 8 is different
than the amount of such excise tax as determined by the Accountants as provided
above, then: (A) if the amount of such excise tax payable by you as determined
by the IRS is less than the amount of such excise tax as computed by the
Accountants, you will reimburse PSI for all excess amounts actually paid to you
by PSI under this Section 8 due to the over-calculation of such excise tax by
the Accountants within five (5) business days after you receive either a refund
from the IRS due to such over-calculation or you receive an economic benefit
from the IRS (such as a credit against tax payable) on account of such
over-calculation, provided you reported and paid all your excise and income tax
liabilities resulting from the operation of this Section 8 consistent with the
amounts you were actually paid hereunder; and (B) if the amount of such excise
tax payable by you as determined by the IRS is greater than the amount of such
excise tax as computed by the Accountants, then PSI will promptly reimburse you
for the amounts that PSI underpaid you under this Section 8 due to the under-calculation
of such excise tax by the Accountants.  (d)In the
event any of the benefits provided for in this Agreement or any other benefits
approved at any time by the Board or the Compensation Committee of the Board
and otherwise payable to you (including stock options) constitute parachute
payments within the meaning of Section 280G of the Code and will be subject to
the excise tax imposed by Section 4999 of the Code, then you may, at your sole
option and discretion, elect to waive, not receive and/or reduce such benefits
to such lesser extent as will result in no portion of such benefits being
subject to the excise tax imposed by Section 4999 of the  6 
   Code, and in that case PSIs obligation
to make a payment to you pursuant to the provisions of Section 8 will be
correspondingly reduced.  9.RELEASE. You
agree that the severance payments you may be entitled to upon Termination
without Cause or upon a Change of Control (assuming your employment is terminated
in connection with such Change of Control) will not apply unless you (i) have
executed a general release (in a form customarily used by PSI) of all known and
unknown claims that you may then have against PSI and/or persons or entities
affiliated with PSI, (ii) have agreed not to prosecute or bring any legal
action or other proceeding based upon any of such claims and (iii) have agreed
to provide transition assistance to PSI (or the surviving corporation) as
requested and without further compensation for 3 months following the
termination of employment.  10.CONFIDENTIALITY;
NONSOLICITATION.  In light of the fact
that the confidential information that you have acquired, and will acquire, is
inextricably bound with your knowledge regarding the conduct of PSIs business
activities and that therefore you would necessarily use confidential
information if you were to compete with PSI, you agree that during the
Employment Term, and for a period of one year thereafter, you will not provide
any services, whether as an officer, director, proprietor, employee, partner,
consultant, advisor, agent, sales representative or otherwise, nor will you own
beneficially securities of any entity (except that, in the case of any entity
whose equity securities are publicly-held, you may beneficially own up to 2% of
the outstanding equity securities of such entity or any mutual fund holding
securities of such entity) that, directly or indirectly, competes with any of
PSIs present or future (up to the date of termination) business
activities.  You further agree that in
light of the nature of PSIs business, and the life-cycle of product
development, the one-year period provided for above shall apply in regardless
of the nature or reason for your termination and that it is reasonable and
necessary in order to protect the confidential, proprietary and trade-secret
information that you will acquire as a result of being the President and Chief
Executive Officer of PSI. Notwithstanding the foregoing, such restrictions
shall not preclude you from providing any services to a distinct business unit
of an entity if such unit does not compete with PSIs business activities,
regardless of whether any other distinct business unit of such entity competes
with PSIs business activities.  You also,
further and independently, agree that during your employment with PSI, and for
a period of one (1) year after termination of your employment with PSI, you
will not for any reason, whether directly or indirectly: (a) solicit, recruit,
take away or attempt to take away, any employee or consultant of PSI or any of
its affiliates, or induce (or attempt to induce) any employee or consultant of
PSI or any of its affiliates to terminate his or its employment or services
with PSI or any of PSIs affiliates; or (b) use any confidential or proprietary
information of PSI or any of its affiliates to, directly or indirectly, solicit
any customer of PSI or any of its affiliates or induce any customer of PSI or
its affiliates to terminate its relationship with PSI or any PSI affiliate;
provided, however, that this non-solicitation provision shall not prevent you
from hiring any employee or consultant of PSI or  7 
   any of its affiliates that you can
demonstrate either (i) approached you independently without any prior direct or
indirect solicitation or encouragement by you or on your part, or (ii) replied
to a solicitation made to the general public without any direct or indirect
solicitation or encouragement by you or on your part.  11.GOVERNING
LAW.
This letter agreement will be governed by the internal laws of the State of
California without reference to its conflict of laws provisions.  12.ENTIRE
AGREEMENT. This letter agreement, your stock option agreement and
your employee invention assignment and confidentiality agreement with PSI
contain the entire agreement and understanding of the parties with respect to
the subject mature hereof. Except as provided in this letter agreement, no
other agreements, representations or understandings (whether oral or written
and whether expressed or implied) which are not expressly set forth in this
letter agreement have been made or entered into by either party with respect to
the subject matter hereof.  13.SUCCESSORS
AND ASSIGNS. This letter agreement will be binding upon you (and your
successors, heirs and assigns) and any successor (whether direct or indirect
and whether by purchase, lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of PSIs business and/or assets.  For all purposes of this letter agreement,
the term PSI shall include any successor to PSIs business and/or asserts
which becomes bound by this letter agreement.  14.LEGAL
FEES.  PSI will reimburse
you for reasonable legal fess and costs not to exceed $5,000 that you incur in
connection with the negotiation and drafting of this letter agreement, your
stock option grant agreement and any related agreements.  We
look forward to your continued contributions as part of the PSI team.  Sincerely
  yours,/s/James P. JenkinsJames
  P. JenkinsChairman
  of the Board  By
signing this letter, I am agreeing to the above:  Signature:
  
  
  Date:  8 
   any of its affiliates that you
can demonstrate either (i) approached you independently without any prior
direct or indirect solicitation or encouragement by you or on your part, or
(ii) replied to a solicitation made to the general public without any direct or
indirect solicitation or encouragement by you or on your part.  11.GOVERNING
LAW.  This letter agreement will be governed by
the internal laws of the State of California without reference to its conflict
of laws provisions.  12.ENTIRE
AGREEMENT.  This letter
agreement, your stock option agreement and your employee invention assignment
and confidentiality agreement with PSI contain the entire agreement and
understanding of the parties with respect to the subject mature hereof. Except
as provided in this letter agreement, no other agreements, representations or
understandings (whether oral or written and whether expressed or implied) which
are not expressly set forth in this letter agreement have been made or entered
into by either party with respect to the subject matter hereof.  13.SUCCESSORS
AND ASSIGNS.  This letter
agreement will be binding upon you (and your successors, heirs and assigns) and
any successor (whether direct or indirect and whether by purchase, lease,
merger, consolidation, liquidation or otherwise) to all or substantially all of
PSIs business and/or assets.  For all
purposes of this letter agreement, the term PSI shall include any successor
to PSIs business and/or asserts which becomes bound by this letter agreement.  14.LEGAL
FEES.  PSI will reimburse
you for reasonable legal fees and costs not to exceed $5,000 that you incur in
connection with the negotiation and drafting of this letter agreement, your
stock option grant agreement and any related agreements.  We
look forward to your continued contributions as part of the PSI team.   Sincerely
  yours,James
  P. JenkinsChairman
  of the Board  By signing this letter, I am
agreeing to the above:  Signature:
  /s/ John Mutch
  
  Date:
  8/14/03  9