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                                                                    EXHIBIT 10.3

                     FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

         This First Amendment to Employment Agreement (the "First Amendment") is
made and entered into as of July 27th, 2004 by and between Onyx Software
Corporation, a Washington corporation (the "Corporation") and Brent Frei (the
"Executive"). This First Amendment modifies the employment agreement originally
executed between the parties on February 19th, 2004 (the "Employment Agreement")
which is hereby incorporated by reference. In the event of any conflict between
the Employment Agreement and the First Amendment, the terms of this First
Amendment shall control. Capitalized terms not defined herein shall have the
meaning ascribed to them in the Employment Agreement.

         In consideration of the mutual covenants and agreements contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Corporation and Executive agree as
follows:

1.   Section 1(a) of the Employment Agreement is hereby deleted in its entirety
     and replaced with the following:

         Basic Rule. The Corporation agrees to continue to employ the Executive
         and the Executive agrees to continue to remain in employment with the
         Corporation in the capacity of Founder until the earliest of:

               (1)  The date of Executive's death; or

               (2)  The date on when the Executives employment terminates
                    pursuant to Subsection 9(b), (c), (d) or (e) below.

2.   Any notice requirements of the Corporation's Board of Directors shall be
     deemed effective if such notice is provided by the Corporation's Chief
     Executive Officer ("CEO"). Such notice requirements include without
     limitation those contemplated in Sections 1(b) and 1(c).

3.   Section 1(c) of the Employment Agreement is hereby deleted in its entirety
     and replaced with the following:

         Termination for Cause. The Corporation may terminate the Executive's
         employment at any time (without prior notice) for Cause shown. For all
         purposes under this Agreement, "Cause" shall mean (1) a willful and
         continued failure, after written notice and an opportunity to cure, to
         perform the Executive's duties under this Agreement, other than a
         failure resulting from the Executive's complete or partial incapacity
         due to physical or mental illness or impairment, (2) a willful act by
         the Executive that constitutes gross misconduct and that results in
         material harm to the Corporation, (3) a willful breach by the Executive
         of a material provision of this Agreement or (4) a material and willful
         violation of a federal or state law or regulation applicable to the
         business of the Corporation that results in material harm to the
         Corporation. For purposes of this Agreement, no act, or failure to act,
         on the Executive's part shall be deemed "willful" unless done, or
         omitted to be done, by the Executive not in good faith and without
         reasonable belief that the Executive's action or omission was in the
         best interest of the Corporation.

4.   Section 2(a) of the Employment Agreement is hereby deleted in its entirety
     and replaced with the following:

         Position. The Corporation agrees to continue to employ the Executive
         for the term of employment under this Agreement in the position of
         Founder. The Executive shall be

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         a part of the Corporation's executive team and report directly to the
         Corporation's CEO and shall be given duties and responsibilities as
         dictated by the CEO.

5.   Executive agrees that effective August 1, 2004, Executive's Base
     Compensation, as defined in Section 3 of the Employment Agreement, shall be
     reduced to $65,000.

6.   Section 4 of the Employment Agreement is hereby deleted in its entirety and
     replaced with the following:

         As a member of the Executive team, Executive will be eligible to
         participate in the Company's annual incentive compensation plan (the
         "Leveraged Compensation Plan"). Under such plan, Executive shall be
         eligible to earn up to a maximum of $160,000 annually. Payments made,
         if any, under the Leveraged Compensation Plan shall be based 100% of
         the achievement of the Corporation's designated financial and business
         goals under the terms and conditions of the Corporation's Leveraged
         Compensation Plan.


7.   Section 9(a) of the Employment Agreement is hereby deleted in its entirety
     and replaced with the following:

         Qualifying Termination.  A Qualifying Termination occurs if:

               (1)  The Corporation terminates the Executive's employment for
                    any reason other than Cause or Disability; or

               (2)  The Executive notifies the Corporation in writing that he
                    will terminate his employment with the Corporation.

8.   In the event severance payments are made to Executive under the provisions
     of Section 9(b) of the Employment Agreement, such payments shall be based
     on Executive's Base Compensation and target incentive bonus in the original
     Employment Agreement. For the avoidance of doubt, in this scenario,
     severance would be calculated using $250,000 as Base Compensation and the
     target incentive bonus would be calculated at 65% of the Base Compensation.

9.   Save for as expressly provided above, all other terms and conditions of the
     Employment Agreement shall remain unchanged.

IN WITNESS HEREOF, each of the parties has executed this First Amendment, in the
case of the Corporation by its duly authorized officer, as of July 27th, 2004.


ONYX SOFTWARE CORPORATION                   EXECUTIVE


By:  /s/ Janice P. Anderson                 By:      /s/ Brent Frei
     ---------------------------
     Janice P. Anderson                              Brent Frei