CEO Employment Agreement

Exhibit 10.1

November 22, 2004

John A. Swainson
32 Main Street,
Ridgefield, CT 06877

Re: Employment Agreement

Dear John:

This is your Employment Agreement (the " Agreement") with Computer Associates International, Inc. , a Delaware corporation (the " Company"). It sets forth the terms of your employment with the Company and its affiliates from time to time (together, the " Group").

1. Your Position, Performance and Other Activities

(a) Position. You will be employed in the position of President of the Company. It is anticipated that you will be employed in the position of Chief Executive Officer of the Company within six (6) months of your Start Date (as defined in Section 2). You will be appointed to the Company's Board of Directors (the " Board") as of your Start Date (as defined in Section 2) and the Company will use all reasonable efforts to cause you to be nominated for re-election each time your term expires during your employment. You agree to serve as a member of the Board, as well as a member of any Board committee to which you may be elected or appointed. You also agree that you will be deemed to have resigned from the Board and each Board committee voluntarily, without any further action by you, as of the end of your employment.

(b) Authority, Responsibilities and Reporting. You will have the authority, responsibilities and reporting relationships that correspond to your position, including any particular authority, responsibilities and reporting relationships consistent with your position that the Board may assign to you from time to time and compliance with such policies of the Company as may be adopted from time to time.


(c) Performance. During your employment, you will devote substantially all of your business time and attention to the Group and will use good faith efforts to discharge your responsibilities under this Agreement to the best of your ability. During your employment, your place of performance will be Islandia, New York or such other place as the Board determines.

(d) Other Activities. During your employment, you will not render any business, commercial or professional services to any non-member of the Group. However, you may (1) serve on corporate, civic or charitable boards, (2) manage personal investments, or (3) deliver lectures, or fulfill speaking engagements or teach at educational institutions, so long as (A) these activities do not interfere with your performance of your responsibilities under this Agreement and (B) any service on a corporate, civic or charitable board is approved by the Board.

2. Term of Your Employment

Subject to your satisfactory completion of pre- and post-employment background, reference and other checks, your employment under this Agreement will (a) begin on November 22, 2004 (the " Start Date" of this Agreement) and (b) end at the close of business on the earlier of (1) the end of the Compensation Period or (2) the effective date of early termination of your employment. Your " Compensation Period" begins on your Start Date and is initially scheduled to end on the fifth anniversary of your Start Date. Beginning on the fifth anniversary of your Start Date and on each following anniversary, your Compensation Period will automatically extend for one year unless either you or the Company gives at least 90 days' prior notice of non-extension. In no event, however, will your Compensation Period extend beyond the end of the Company's fiscal year in which your 65th birthday occurs. References in this Agreement to " your employment" are to your employment under this Agreement.

3. Your Compensation

(a) Salary. During your employment, you will receive an annual base salary (as increased from time to time, your " Salary"). The starting amount of your Salary is $1,000,000. The Company will review your Salary at least annually and may increase it at any time for any reason. However, your Salary may not be decreased at any time (including after any increase) without your written consent and any increase in your Salary will not reduce or limit any other obligation to you under this Agreement. Your Salary will be paid in accordance with the Group's normal practices for senior executives.

(b) Bonus. You will be eligible to receive an annual cash bonus (your " Bonus") for each fiscal year of the Company ending during your employment. The target level for your Bonus in each full fiscal year of your employment will be at least 100% of your Salary (the " Target Annual Bonus") and the maximum level for your Bonus will be 200% of your Salary. You will be entitled to a minimum Bonus of $333,334 for the Company's fiscal year ending March 31, 2005. Your Bonus will be paid at the same time as such bonuses are paid to other senior executives of the Company.

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(c) Long-Term Incentive Awards. You will be eligible to receive long-term incentive awards (" Long-Term Incentive Awards") as determined by the Company in accordance with the Company's Long-Term Incentive Plan (and any successor plan) in which you will begin to participate for the performance period starting April 1, 2005. The target award level under the Company's Long-Term Incentive Plan initially will be 2.5 times your Salary. The maximum award level under the Company's Long-Term Incentive Plan initially will be 3.75 times your Salary.

(d) Initial Incentive Awards. (1) In addition to your Salary and Bonus, on your Start Date you will be awarded (A) stock options to purchase 350,000 shares of the Company's common stock (your " Sign-On Options") and (B) 100,000 restricted shares of the Company's common stock (your " Sign-On Stock").

(2) Your Sign-On Options will be granted under the Company's 2002 Incentive Plan and will have an exercise price equal to the Start Date Closing Price. Your Sign-On Options will vest 34%, 33% and 33% on the first, second and third anniversaries of the Start Date.

(3) Your Sign-On Stock will be granted under the Company's 2002 Incentive Plan. Initially, your Sign-On Stock may not be transferred or assigned and will be forfeited to the Company for zero (0) consideration if your employment with the Company is terminated for any reason prior to vesting. Your Sign-On Stock will vest in equal installments on each of the first three one-year anniversaries of your Start Date (such restricted stock is "vested" when it is no longer subject to such transfer restrictions and forfeiture provisions).

(4) Except as provided in this Agreement, your Sign-On Options and Sign-On Stock will be subject to the terms of the Company's 2002 Incentive Plan and to the terms of your award agreement under it (which will contain the Group's normal provisions for senior executives).

(e) Relocation Benefit. In accordance with the Company's Relocation Policy, you will be eligible to be reimbursed for your reasonable costs incurred in connection with your relocation to the Company's headquarters in Islandia, New York. In addition, you shall receive up to 12 months of temporary corporate housing in accordance with Company policy.

(f) Restricted Stock Units . In addition to your Sign-On Stock, on your Start Date you will be awarded restricted stock units with respect to 100,000 shares of the Company's common stock (your " RSUs"). Your RSUs will be granted under the Company's 2002 Incentive Plan. Your RSUs may not be transferred or assigned until six (6) months after the date on which your employment with the Group terminates for any reason. Six (6) months after your date of termination, your RSUs will fully vest, be transferable and be paid to you. You will also receive dividend equivalent rights entitling you to be paid, at the same time as other shareholders of the Company, any dividends declared and paid in respect of the 100,000 shares of the Company's common stock underlying your RSUs.

(g) Signing Bonus . Within 30 days of your Start Date, you will receive a signing bonus equal to $2.5 million in cash. Additionally, you will receive the

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present value of $2.8 million, the form and manner of such payment to be agreed by you and the Company; provided, however, if you and the Company fail to agree on a form and manner of this payment within 60 days of the Start Date, the Company has the right to make the $2.8 million payment in cash.

4. Other Employee Benefits

(a) Vacation. You will be entitled to paid annual vacation during your employment (totaling at least four (4) weeks a year) on a basis that is at least as favorable as that provided to other senior executives of the Group.

(b) Business Expenses. You will be reimbursed for all business and entertainment expenses incurred by you in performing your responsibilities under this Agreement. However , your reimbursement will be subject to the Group's normal practices for senior executives.

(c) Facilities. During your employment, you will be provided with office space, facilities, secretarial support and other business services consistent with your position on a basis that is at least as favorable as that provided to other senior executives of the Group.

(d) Indemnification. To the extent permitted by law, the Company will indemnify you against any actual or threatened action, suit or proceeding, whether civil, criminal, administrative or investigative, arising by reason of your status as a director, officer, employee and/or agent of the Group during your employment. In addition, to the extent permitted by law, the Company will pay or reimburse any expenses, including reasonable attorney's fees, you incur in investigating and defending any actual or threatened action, suit or proceeding for which you may be entitled to indemnification under this Section 4(d). However, you agree to repay any expenses paid or reimbursed by the Company if it is ultimately determined that you are not legally entitled to be indemnified by the Company. If the Company's ability to make any payment contemplated by this Section 4(d) depends on an investigation or determination by the board of directors of any member of the Group, at your request the Company will use its best efforts to cause the investigation to be made (at the Company's expense) and to have the relevant board reach a determination as soon as reasonably possible. This indemnification will be at least as favorable as that provided to other senior executives and directors of the Group.

(e) Employee Benefit Plans. During your employment, you will be eligible to participate in the Group's employee benefit and welfare plans, including plans providing retirement benefits, medical, dental, hospitalization, life or disability insurance, on a basis that is at least as favorable as that provided to other senior executives of the Group.

5. Early Termination of Your Employment

(a) No Reason Required. You or the Company may terminate your employment early at any time for any reason, or for no reason, subject to compliance with Section 5(e).

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(b) Termination by the Company for Cause.

(1) " Cause" means any of the following:

(A) Your continued failure, either due to willful action or as a result of gross neglect, to substantially perform your duties and responsibilities to the Group under this Agreement (other than any such failure resulting from your incapacity due to physical or mental illness) that, if capable of being cured, has not been cured within thirty (30) days after written notice is delivered to you by the Board, which notice specifies in reasonable detail the manner in which the Company believes you have not substantially performed your duties and responsibilities.

(B) Your engagement in conduct which is demonstrably and materially injurious to the Group, or that materially harms the reputation or financial position of the Group, unless the conduct in question was undertaken in good faith on an informed basis with due care and with a rational business purpose and based upon the honest belief that such conduct was in the best interest of the Group.

(C) Your indictment or conviction of, or plea of guilty or nolo contendere to, a felony or any other crime involving dishonesty, fraud or moral turpitude.

(D) Your being found liable in any SEC or other civil or criminal securities law action or entering any cease and desist order with respect to such action (regardless of whether or not you admit or deny liability).

(E) Your breach of your fiduciary duties to the Group which may reasonably be expected to have a material adverse effect on the Group. However , to the extent the breach is curable, the Company must give you notice and a reasonable opportunity to cure.

(F) Your (i) obstructing or impeding, (ii) endeavoring to influence, obstruct or impede or (iii) failing to materially cooperate with, any investigation authorized by the Board or any governmental or self-regulatory entity (an " Investigation"). However, your failure to waive attorney-client privilege relating to communications with your own attorney in connection with an Investigation shall not constitute "Cause".

(G) Your removing, concealing, destroying, purposely withholding, altering or by any other means falsifying any material which is requested in connection with an Investigation.

(H) Your disqualification or bar by any governmental or self-regulatory authority from serving in the capacity contemplated by this Agreement or your loss of any governmental or self-regulatory license that is reasonably necessary for you to perform your responsibilities to the Group under this Agreement, if (i) the

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disqualification, bar or loss continues for more than 30 days and (ii) during that period the Group uses its good faith efforts to cause the disqualification or bar to be lifted or the license replaced. While any disqualification, bar or loss continues during your employment, you will serve in the capacity contemplated by this Agreement to whatever extent legally permissible and, if your employment is not permissible, you will be placed on leave (which will be paid to the extent legally permissible).

(I) Your unauthorized use or disclosure of confidential or proprietary information, or related materials, or the violation of any of the terms of the Company's standard confidentiality policies and procedures, in the case of any item identified in this clause (I) which may reasonably be expected to have a material adverse effect on the Group and that, if capable of being cured, has not been cured within thirty (30) days after written notice is delivered to you by the Company, which notice specifies in reasonable detail the alleged unauthorized use or disclosure or violation.

(J) Your violation of the Group's (i) Workplace Violence Policy or (ii) policies on discrimination, unlawful harassment or substance abuse.

For this definition, no act or omission by you will be "willful" unless it is made by you in bad faith or without a reasonable belief that your act or omission was in the best interests of the Group.

(2) To terminate your employment "for Cause", the Board must determine in good faith that Cause has occurred, the Company must comply with Section 5(e) and the Company must deliver to you a copy of a resolution duly adopted by a majority of the entire Board (excluding you) at a meeting of the Board called and held for such purpose (after reasonable notice to you and a reasonable opportunity for you and your counsel to be heard) that finds that in the good faith opinion of the Board, Cause has occurred and states the basis for that belief.

(c) Termination by You for Good Reason.

(1) " Good Reason" means any of the following:

(A) Any material and adverse change in your position with the Group (including by reason of the Company's failure to cause you to be nominated to the Board).

(B) Any failure by the Company to provide you with authority, responsibilities and reporting relationships as provided in Section 1(b) or any material and adverse reduction in your authority, responsibility or reporting relationships or the assignment of any duties inconsistent in any material respect with your position, authority, duties or responsibilities, in each case other than any isolate ...