<PAGE>
                                                                   EXHIBIT 10.16

September 25, 2000

Mr. David B. Wright
17299 Deer Park Road
Los Gatos, CA  95232

Dear Dave:

I am delighted to extend to you an offer of employment with Legato Systems, Inc.
as our new President & Chief Executive Officer.  In this capacity, you will have
complete operating responsibility for the Company and all of its business
operations.  In this position, you will report to the Board of Directors and me,
as Chairman of the Board.  We will need to discuss a mutually agreeable start
date.  Other details of your offer are as follows:

Annual Base Salary - Your initial base salary will be $650,000, commencing as of
your effective start date.  You will be paid on a monthly basis and your
paycheck will be automatically deposited in the bank of your choice.

Sign-On Bonus -You will be extended a $600,000 sign-on bonus to be paid within
fifteen days of your effective start date, subject to all applicable taxes.
Your sign-on bonus will not be treated as compensation for purposes of
determining your annual incentive award.  This award is intended to provide you
funds to compensate you for your earned, but unpaid bonus at your current
company, and provide you an amount to purchase your membership at La Rinconada.

Incentive Award - You will be eligible to participate in our management
incentive plan, which provides for year-end incentive awards based on the
success of Legato Systems, Inc. in meeting annual performance objectives.  For
your position, the targeted incentive opportunity is 100% of your salary
($650,000) and that maximum award is 200% ($1,300,000) of salary.  Given the
fact that you will forfeit the remainder of your 2000 bonus at your current
company, this bonus will be guaranteed at the 100% rate, prorated for the
percentage of the year you serve with the Company in 2000 (e.g., if you join on
October 1, 2000, which equals 25% of the year, therefore a bonus of $150,000).

For 2001, performance objectives are yet to be established, but will most
probably include revenue growth, profit and effective asset utilization.
<PAGE>

Mr. David B. Wright
September 25, 2000


Equity Awards-

Stock Options/Initial and Subsequent Grants - It is our intention to tie your
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compensation program to the impact you have on overall shareholder return.  As
such, you will receive one-time stock option grant, as of your effective start
date, to purchase 2,000,000 share of Legato Systems, Inc. common stock.  The
option will be subject to terms and conditions substantially similar to those
applicable to options granted under the Company's 1995 Stock Option/Stock
Issuance Plan ("Option Plan"), as described in that Option Plan and the
applicable stock option agreement The option will become exercisable for 25% of
the options shares after 12 months of continuous service and the balance in
equal monthly installments over the next 36 months of continuous service, as
described in the applicable stock option agreement.  It is the company's
practice to review each executive's option position on an annual basis.  In
doing this, we attempt to recognize our executives' contributions to corporate
performance, reward individual performance and assure a meaningful equity
interest.  Accordingly, the Compensation Committee of Legato's Board of
Directors will review your equity position every year, beginning in the spring
of 2002, and when it deems appropriate, award you additional options to continue
to align your interests with that of our shareholder base.

Restricted Stock - In lieu of your current compensation and equity situation,
----------------
you will receive a special restricted stock grant, as of your effective start
date.  This grant will be for 100,000 shares of Legato Systems, Inc. common
stock with a purchase price equal to the par value of  $0.01 per share.  The
shares will be subject to terms and conditions substantially similar to those
applicable to shares granted under the Option Plan, as described in the Option
Plan and the applicable stock issuance agreement.  These shares will be set up
in a record account in your name with Legato's Transfer Agent and Stock
Registrar and will vest (become transferable) over a one year period.  The
vesting schedule will allow for transfer of 25,000 shares for every three months
of your employment over this first year.  You will be responsible for all
applicable withholding taxes upon vesting of the shares.  In addition, the
restricted stock will vest in full in the event that your employment is
terminated by the Company other than for "cause".

Furthermore, the Company will loan up to $500,000 collateralized against your
restricted stock upon receipt of your full-recourse promissory note.  Payment of
principal and interest on this loan will begin at the end of one year. Once
repayment has begun, you will have three years to complete the repayment
schedule.  Interest will be determined at a market rate at the time the loan is
extended.

Vacation - In recognition of your prior work experience, you will be eligible
for four weeks of paid vacation each year.

Special Severance - Should the Company terminate your employment without Cause
(as defined below), you will be entitled to continuation of your base salary for
up to 18 months or until you find suitable employment.  Cause shall mean (a)
                                                        -----
your commission of a felony or other criminal act, (b) gross misconduct, (c)
gross negligence in the performance of your duties to the Company, (d)
commission of any act of fraud with respect to the Company, or (e) material
breach of a proprietary information inventions agreement with the Company.
<PAGE>

Mr. David B. Wright
September 25, 2000


No cash severance payment shall be payable pursuant to this offer letter unless
you  (i) have executed a general release (in a form prescribed by the Company)
of all known and unknown claims that you may then have against the Company or
persons affiliated with the Company and (ii) have agreed not to prosecute any
legal action or other proceeding based upon any of such claims.

Other Benefits - Legato has an excellent and comprehensive benefit package.
Enclosed you will find a Benefit Summary outlining Legato's current programs.
More detailed information on Legato's employee benefits package will be
presented to you on your first day of employment.  Please contact Jack Landers,
Vice President of Human Resources, at (650) 210-7449 if you have any questions.
In addition, you will receive Life Insurance Coverage in the face amount of
$2,000,000 in term coverage and a $800 per month automobile allowance.

Change-of-Control - In the event of an Involuntary Termination of your
employment or a material change in your responsibilities (e.g., you are no
longer the Chief Executive of a stand-alone public company) within 18 months
following a Corporate Transaction involving the Company (as such terms are
defined in the Option Plan), the Company will provide you the following:

     -Immediate vesting for 100% of your unvested stock options,
     -Accelerated vesting for all of your restricted stock,
     -A one-time lump sum cash payment equal to your then annual base salary and
      your targeted bonus or prior year bonus, which ever amount is higher.

                                   * * * * *

Under the Immigration Reform Act all new employees are required to show proof of
citizenship or right to work status.  On the date you begin employment, you
would need to bring (i) a certified copy of your birth certificate, and driver's
license, or (ii) valid passport, or (iii) drivers license and original social
security card, or (iv) equivalent documents acceptable to the Immigration and
Naturalization Service.

Legato Systems requires that all new employees sign a Proprietary Information
and Invention Agreement and the Competitive Product Review Agreement prior to
any work being performed.  A copy of the Proprietary Information and Inventions
Agreement and Competitive Product Review Agreement is enclosed with this letter.
By signing this letter, you confirm to the Company that you are under no
contractual or other legal obligations that would prohibit you from performing
your duties for the Company.

Legato Systems is an "at will" employer.  This means that each employee is
employed with the Company at his/her own will and the Company's will.  The
Company does not provide employees with contracts of employment, express or
otherwise and the Company makes no representation as to the amount of time you
can expect to be in its employ.  Your employment with Legato will remain "at
will" unless you receive an individualized written letter addressed to you and
signed by a majority of the members of the Board of Directors of the Company.
<PAGE>

Mr. David B. Wright
September 25, 2000


This letter reflects the entire agreement regarding the terms and conditions of
your employment with Legato Systems, Inc.  Accordingly, it supersedes and
completely replaces any prior oral or written communication on this subject.
Also, this offer is contingent upon completion of full reference checks, which
are currently underway.

Dave, we are enthusiastic about the background, experience and vision you bring
to Legato Systems, Inc.  The company is positioned well in our market to be
exceedingly successful and I personally would like extend my warm invitation to
lead the organization and be part of our family.

If you have any questions concerning the details of the appointment, please free
to contact me.

Sincerely,

/s/ Louis C. Cole

Lou Cole
Chairman and Chief Executive Officer, Legato Systems, Inc.


/s/ David B. Wright                      9/27/00
-------------------------------         ----------
Agreed and Accepted                     Date
David B. Wright
<PAGE>

                       AMENDMENT TO EMPLOYMENT AGREEMENT
                       --------------------------------

     This Amendment (the "Amendment") is entered into by David B. Wright
("Wright"), an individual, and Legato Systems, Inc., a Delaware corporation
("Legato" or "the Company").  The Effective Date of this Amendment shall be the
latest date appearing next to the signatures set forth below.

     WHEREAS, Wright and the Company agreed to terms of Wright's employment with
Legato in an offer letter dated September 25, 2000 ("the Employment Agreement");
and

     WHEREAS, Wright and the Company have discussed and agreed to amendments to
that Employment Agreement;

     NOW THEREFORE, the Agreement is hereby amended by the following
modifications:

                                 Equity Awards
                                 -------------

     The initial stock option granted to Wright to purchase 2,250,000 shares of
the Company's common stock is clarified as follows:

     The Company's 1995 Stock Option/Stock Issuance Plan permits a maximum
initial grant to an individual of 1,600,000 shares in any calendar year.
Accordingly, options to purchase 1,600,000 shares of the Company's common stock
were granted on November 10, 2000 at $9.75 per share.  The remaining options to
purchase 650,000 shares of the Company's common stock will be granted on January
2, 2001 at $9.75 per share.

     An option to purchase 2,000,000 shares of the Company's common stock will
become vested and exercisable for 25% of the options shares after 12 months of
continuous service and the balance in equal monthly installments over the next
36 months of continuous service.  An additional option to purchase 250,000
shares of the Company's common stock will become vested and exercisable in equal
monthly installments over Wright's first 12 months of continuous service.  The
specific terms of each of these option grants are set forth in stock option
agreements separate from the Agreement referenced in this Amendment and separate
from this Amendment.

     Further, Wright and the Company agree that the $500,000.00 loan provided
for in the Employment Agreement will be secured by a deed of trust (which shall
be of not less than second priority) against Wright's principal residence, which
is real property located at 17299 Deer Park Road, Los Gatos, California 95030.
Wright and Company also agree that such loan shall be a "full-recourse" loan,
the terms of which will be set forth separately in a Promissory Note to be
executed as soon as is practicable.

     Except as expressly modified herein, all of the remaining terms and
conditions of the Employment Agreement shall remain in full force and effect.
Accordingly, the Employment Agreement and this Amendment together reflect the
entire agreement regarding the terms and conditions of Executive's employment
with the Company.  Accordingly, the Employment Agreement and this Amendment
together supersede and completely replaces any prior oral or written
communications on this subject.
<PAGE>

IN WITNESS WHEREOF, the parties hereto have approved and executed the Agreement
on the dates set forth opposite their respective signatures.

EXECUTED by the parties as follows:

Dated:  December 4, 2000                DAVID B. WRIGHT


                                        By: /s/ David B. Wright
                                           ---------------------------
                                           David B. Wright



Dated:  December 4, 2000                LEGATO SYSTEMS, INC.



                                        By: /s/ Louis C. Cole
                                           ---------------------------
                                           Louis C. Cole
                                           Chairman of the Board of Directors
<PAGE>

                               PROMISSORY NOTE
                               ---------------

$500,000.00                                                     December 6, 2000
                                                       Mountain View, California


        FOR VALUE RECEIVED, the undersigned Borrower promises to pay to Legato
Systems, Inc., a Delaware corporation (the "Company" or "Legato"), at its
principal offices at 2350 West El Camino Real, Mountain View, California 94040
the principal sum of five hundred thousand dollars ($500,000.00), together
with interest from the date of this Note on the unpaid principal balance upon
the terms and conditions specified below.

        1.      Principal and Interest.  The principal balance of this Note
                ----------------------
together with interest accrued and unpaid to date shall be due and payable
three (3) years from the date of this Note, except as set forth in Paragraph 4
herein.

        2.      Rate of Interest.  Interest shall accrue under the Note on any
                ----------------
unpaid principal balance at the rate of 6.5%.

        3.      Prepayment.  Prepayment of principal and interest may be made
                -----------
at any time without penalty.

        4.      Forgiveness.  Provided Borrower is employed by the Company two
                -----------
(2) years from the date of this Note and Borrower is not in default of this
Note or payment of this Note has not been otherwise accelerated pursuant to
Section 5 of this Note, then fifty percent (50%) of the principal amount and
all accrued interest to date shall be forgiven. Provided Borrower is employed
by the Company three (3) years from the date of this Note and Borrower is not
in default of this Note or payment of this Note has not been otherwise
accelerated pursuant to Section 5 of this Note, then the entire unpaid
principal amount and all accrued interest thereon shall be forgiven. On each
date, Borrower shall promptly remit sufficient funds to the Company to pay all
applicable withholding taxes.

        5.      Events of Acceleration.  The entire unpaid principal sum and
                ----------------------
unpaid interest of this Note shall become immediately due and payable upon one
or more of the following events:

                A.      the date that Borrower shall cease to be employed by
Legato; or

                B.      the failure of the Borrower to pay when due the
principal balance and accrued interest on this Note and the continuation of
such default for more than thirty (30) days; or

                C.      the filing of a petition by or against Borrower under
any provisions of the Bankruptcy Reform Act, Title 11 of the United States
Code, as amended or recodified from time to time, or under any similar or
other law relating to bankruptcy, insolvency,

                                   Page 1
<PAGE>

reorganization or other relief for debtors; the appointment of a receiver,
trustee, custodian, or liquidator of or for any part of the assets or property
of Borrower; the execution by the Borrower of a general assignment for the
benefit of creditors; the insolvency of Borrower or Borrower is generally not
paying its debts as they become due; or any attachment or like levy on any
property of Borrower; or

                D.      the occurrence of a material event of default under any
deed of trust securing this Note; or

                E.      the failure of the Borrower to execute a deed of trust
(in form and substance satisfactory to the Company) encumbering Borrower's
principal residence in the state of California within five (5) days after a
request from the Company; or the failure of the Borrower to have removed any
deed of trust securing obligations to Borrower's prior employer and which is
encumbering Borrower's principal residence in the state of California within
five (5) days after a request from the Company; or

                F.      the sale, transfer, mortgage, assignment, encumbrance
or lease, whether voluntarily or involuntarily or by operation of law or
otherwise of Borrower's principal residence in the state of California,
including without limitation the real property described in Section 6 of this
Note, or any portion thereof or interest therein without the prior written
consent of the Company.

        6.      Security.  Borrower agrees to execute a deed of trust (which
                --------
shall be of not less than second priority) conveying to the Company a security
interest and lien in Borrower's and Borrower's spouse's interests in Borrower's
principal residence which is real property located at 17299 Deer Park Road,
Los Gatos, California 95030. Regardless of any collateral that may secure
Borrower's obligations under the Note, Borrower shall remain personally liable
for the payment in full of any indebtedness owing under this Note, and the
Company shall have recourse to any and all other assets of the Borrower, in
addition to any collateral described in any deed of trust executed in
connection herewith to satisfy Borrower's obligations hereunder.

        7.      Costs and Expenses; Attorneys' Fees.  If any action is
                -----------------------------------
instituted to collect this Note, the Borrower promises to pay all reasonable
costs and expenses (including reasonable attorneys' fees) incurred by the
Company in connection with the enforcement of the Company's rights and/or the
collection of any amounts that become due to the Company under this Note.

        8.      Waiver.  No previous waiver and no failure or delay by the
                ------
Company or Borrower in acting with respect to the terms of this Note or the
Deed of Trust shall constitute a waiver of any breach, default or failure of
condition under this Note or the Deed of Trust executed in connection herewith
or the obligations secured thereby. A waiver of any term of this Note, the
Deed of Trust or of any of the obligations secured thereby must be made in
writing and signed by a duly authorized officer of the Company and shall be
limited to the express terms of such waiver. Borrower hereby expressly waives
presentment and demand for payment at such time as any payments are due under
this Note.

    Borrower hereby expressly waives presentment and demand for payment at
such time as any payments are due under this Note.

                                   Page 2
<PAGE>

                9.  Conflicting Agreements.  In the event of any inconsistencies
                    ----------------------
between the terms of this Note and the terms of any other document related to
the loan evidenced by the Note, the terms of this Note shall prevail.

               10.  Governing Law. This Note shall be construed in accordance
                    -------------
with the laws of the State of California.


                                        Signature of Borrower

                                        /s/ David B. Wright
                                        ---------------------------------
                                        David B. Wright
                                        Address:  17299 Deer Park Road
                                                  Los Gatos, CA 95030