July
14, 2006
 
 
 P.K.
Karnik
 [Home
Address]
 
 
 
 Dear
P.K.,
 
 It
gives me great pleasure to offer you employment with Chordiant Software, Inc as
Vice President & General Manager for Worldwide Professional Service
reporting to our President & CEO Steven R. Springsteel. This position
qualifies as a 16(b) officer of the Company and entitles you to participate in
the Executive Change in Control program, a copy of which is attached to this
offer. The terms of your employment are detailed as follows:
 
 Your
annual salary will be $250,000.00 less payroll deductions and all required
withholdings, which is paid on the fifteenth and last day of each month.
Additionally, you will also participate in Chordiant’s Bonus Program, pursuant
to the terms of this Program, with a 60 % targeted payout at 100% achievement of
Plan objectives.  This would provide you with total “On Target
Earnings” of $400,000 annually.  Chordiant will have the sole
discretion to determine if you have earned this bonus and, the amount of the
bonus. You must be employed by Chordiant on the date such bonuses are paid in
order to earn any bonus.
 
 The
Compensation Committee will recommend that following your date of hire with
Chordiant you be granted, not sooner than the end of the current fiscal year
which ends on September 30, 2006, an option to purchase 300,000 shares of
the Company’s common stock.  The option shall have an exercise price equal
to the fair market value on the date of grant, and shall be governed in all
respects by the terms of the plan documents and the option agreement between you
and the company. Vesting of the options shall commence upon the grant
date.
 
 You
will be eligible for Chordiant Software’s Employee Benefits program, which
includes among others, participation in our 401(k) and Employee Stock Purchase
Plan when eligible, and the company Group Medical, Dental, and Disability
Insurance Programs.  Chordiant may change compensation and benefits
from time to time in its discretion.
 
 As
a Vice President of Chordiant Software you enjoy the flexibility of taking time
off as the opportunity comes available and as approved by your manager. You are
not required (nor eligible) to participate in the PTO program offered to all
North America Team Members below the Vice President level. Vice Presidents are
specifically excluded from this program and do not accrue PTO.
 
 You
will be expected to sign and comply with a proprietary information and
non-disclosure agreement which requires among other provisions, the assignment
of patent rights to any invention made during your employment at Chordiant
Software and nondisclosure of proprietary information.  You also will
be expected to abide by the Company’s standard policies and procedures, and
acknowledge in writing that you have read and will comply with the Company’s
Employee Handbook.
 
 This
offer is contingent upon a successful background check, successful reference
checks, and your submission of an I-9 form and satisfactory documentation and
identification supporting your right to work in the United
States.  These must be provided on your first day of
employment.  Please bring these with you on your first
day.
 
 Employment
with Chordiant Software is considered employment “at will” and may be terminated
by you or Chordiant Software at any time with or without cause, and with or
without advance notice.  Your employment at-will status can only be
modified in a written agreement signed by you and by a duly authorized officer
of the Company. The Company may change your position, duties, and work location
from time to time in its discretion.
 
 As
part of your duties for Chordiant, you may be assigned to work onsite with a
Chordiant customer.  Some of these customers have additional
requirements that they impose upon individuals who work onsite at their
business.  If you are assigned to work with such a customer, you will
be given notice of the customer’s additional requirements and will be asked to
consent to these requirements.
 This
letter, together with your proprietary information and non-disclosure agreement,
forms the complete and exclusive statement of your employment agreement with the
Company.  The terms in this letter supersede any other agreements or
promises made to you by anyone, whether oral or written.  This letter
agreement cannot be changed except in a written agreement signed by you and a
duly authorized officer of the Company.
 
 This
offer is valid through July 19, 2006 and we would request a start date of
Monday, Aug. 14, 2006. Please sign below to indicate your acceptance of this
offer and return by fax to Human Resources at 408 517-5058
(fax).  Please send an original signed copy in the pre-addressed
enclosed envelope. You can arrange to attend orientation in one of Chordiant’s
remote offices or via conference call with a Human Resource
Representative.
 
 
 
 Sincerely,
 
 /s/
Lisa Ackerman
 
 Lisa
Ackerman
 Senior
Manager, Human Resource
 
 
 Accepted:
/s/ P.K.
Karnik                                                                
Date Signed: 7/20/06                                           Monday
Start Date:  8/14/06