<PAGE>

                                                                  EXHIBIT 10.3.2

                               OFFICE OCCUPATION
                                   AGREEMENT

1.   THE OCCUPIER

NAME:     LINUXCARE INC

ADDRESS:  850 TOWNSEND STREET, SAN FRANCISCO, CA 94103,.

2.   THE OWNER

NAME:     SWALLOWFIELD OFFICE SERVICES LIMITED

ADDRESS:  5 PARK PLACE, LONDON, SW1A 1LP

3.   OFFICES

BUILDING IN WHICH THE OFFICES ARE LOCATED:  WYVOLS COURT, SWALLOWFIELD, READING,
                                            RG7 1WY

OFFICE NUMBER/REFERENCE:                    22.

4.   TERMS OF OCCUPATION

COMMENCEMENT DATE: 1ST NOVEMBER 1999        TERMINATION DATE: 30TH APRIL 2000
MONTHLY OCCUPATION FEE (PLUS VAT):
                         pounds1,350.00 + VAT

SERVICE RETAINER:        pounds2,700.00

THE OTHER TERMS AND CONDITIONS OF OCCUPATION ARE SET OUT OVERLEAF AND THE
OCCUPIER HEREBY ACKNOWLEDGES THAT IT HAS READ AND UNDERSTOOD THEM.

5.   PRELIMINARY AGREEMENT AND COURT ORDER

COURT:                   N/A            PRELIMINARY AGREEMENT:           NO

DATE OF COURT ORDER:     N/A            DATE OF PRELIMINARY AGREEMENT:   N/A

NUMBER OF COURT ORDER:   N/A

6.   SIGNATURE AND DATE

<TABLE>
<S>                                               <C>
SIGNED BY AN AUTHORISED SIGNATORY FOR AND ON      SIGNED BY AN AUTHORISED SIGNATORY FOR AND ON
BEHALF OF THE OWNER:                              BEHALF OF THE OCCUPIER:
NAME (printed):                                   NAME (printed): X ANTHONY V. POLLACE, CFO

SIGNATURE:                                        SIGNATURE: X /s/ Signature Illegible CFO
</TABLE>

DATE OF THIS OFFICE OCCUPATION AGREEMENT:

<PAGE>

                               OFFICE OCCUPATION
                                   AGREEMENT

1.   THE OCCUPIER

NAME:     LINUXCARE INC

ADDRESS:  650 TOWNSEND STREET, SAN FRANCISCO, CA 94103,,

2.   THE OWNER

NAME:     SWALLOWFIELD OFFICE SERVICES LIMITED

ADDRESS:  5 PARK PLACE, LONDON, SW1A 1LP

3.   OFFICES

BUILDING IN WHICH THE OFFICES ARE LOCATED:  WYVOLS COURT, SWALLOWFIELD, READING,
                                            RG7 1WY

OFFICE NUMBER/REFERENCE:                    22.

4.   TERMS OF OCCUPATION

COMMENCEMENT DATE: 1ST NOVEMBER 1999           TERMINATION DATE: 30TH APRIL 2000
MONTHLY OCCUPATION FEE (PLUS VAT):
                       pounds1,350.00 + VAT

SERVICE RETAINER:      pounds2,700.00          /s/ Signature Illegible

THE OTHER TERMS AND CONDITIONS OF OCCUPATION ARE SET OUT OVERLEAF AND THE
OCCUPIER HEREBY ACKNOWLEDGES THAT IT HAS READ AND UNDERSTOOD THEM.

5.   PRELIMINARY AGREEMENT AND COURT ORDER

COURT:                  N/A             PRELIMINARY AGREEMENT:          NO

DATE OF COURT ORDER:    N/A             DATE OF PRELIMINARY AGREEMENT:  N/A

NUMBER OF COURT ORDER:  N/A

6.   SIGNATURE AND DATE

<TABLE>
<S>                                               <C>
SIGNED BY AN AUTHORISED SIGNATORY FOR AND ON      SIGNED BY AN AUTHORISED SIGNATORY FOR AND ON
BEHALF OF THE OWNER:                              BEHALF OF THE OCCUPIER:
NAME (printed):                                   NAME (printed): X  X

SIGNATURE:                                        SIGNATURE: X  X.
</TABLE>

DATE OF THIS OFFICE OCCUPATION AGREEMENT:

<PAGE>

7.       INTERPRETATION

         In this Agreement the expressions set out below carry the following
         meanings:

         "Agreement" - this Office Occupation Agreement;

         "Common Parts" - the parts of the Building from time to time designated
         as such by the Owner;

         "Chargeable Services" - any services (other than the Inclusive
         Services) which are at any time made available to the Occupier by the
         Owner and details of which are available at the Building;

         "Fixtures and Fittings" - the fixtures and fittings listed in an
         Inventory to be agreed between and signed on behalf of the Owner and
         the Occupier;

         "Inclusive Services" - the services specified in the Schedule;

         "Occupier", "Owner", "Offices", "Commencement Date", "Building",

         "TERMINATION DATE", "Monthly Occupation Fee" and "Service Retainer"
         carry the meanings given in Clauses 1 to 4 and "Term" means the term of
         this Agreement commencing on the Commencement Date and terminating on
         the Termination Date

         References to the parties shall include their respective successors in
         title and references to the Owner shall also include any person or
         company appointed by the Owner to carry out all or part of the Owner's
         obligations under this Agreement.

8        DEMISE AND TERM

8.1      The Owner lets to the Occupier the Offices including the Fixtures and
         Fittings for the duration of the Term.

8.2      The Owner grants to the Occupier the right in common with the Owner and
         all other persons so entitled:

(a)      to use such lavatories and kitchens as are designated by the Owner for
         use by the Occupier; and

(b)      to use the entrance hall, passages, staircases and the lift(s) within
         the Common Parts for the purposes only of gaining access to and egress
         from the Offices.

8.3      The Offices are let to the Occupier subject to the rights of the Owner,
         and all others authorised from time to time by the Owner to use,
         repair, maintain and replace any service conducting media within the
         Offices which rights are hereby reserved.

9.       FINANCIAL MATTERS

9 1      The Occupier shall pay by Direct Debit:-

(a)      the Monthly Occupation Fee plus VAT in advance on the 1st day of each
         calendar month of the Term; and

(b)      on demand from time to time any sums due in respect of the use of any
         Chargeable Services plus VAT.

9.2      The Monthly Occupation Fee includes the cost of providing the Inclusive
         Services but not the cost of providing the Chargeable Services.

9.3      On or before the Commencement Date the Occupier shall pay the Service
         Retainer which will be held by the Owner for the benefit of the Owner
         as security for any breach of the terms of this Agreement.

         The Owner may withdraw money from the Service Retainer at any time in
         order to make good any sums payable by the Owner or the Occupier as the
         case may be which result from any breach by the Occupier of any of the
         terms of this Agreement. After any withdrawal from the Service
         Retainer, the Occupier shall on demand by the Owner pay such sum as is
         necessary to restore the Service Retainer to its full amount as set out
         in Clause 4. Any withdrawal from the Service Retainer shall be without
         prejudice to any other rights or remedies of the Owner in relation to
         the relevant breach of the terms of this Agreement.
<PAGE>

         The Service Retainer (or such balance of it, if any, as remains after
         any withdrawals) shall be refunded to the Occupier within twenty one
         days from the Termination Date or sooner at the Owner's absolute
         discretion.

         The Service Retainer may not be used by the Occupier as payment for any
         sum due under this Agreement.

9.4      The Occupier shall keep the Owner indemnified from and against all
         expenses, losses and claims arising from any breach of the Occupier's
         obligations contained in this Agreement, or from the use of the Offices
         by the Occupier, or arising from any act, omission, neglect or default
         of the Occupier.

9.5      If the Occupier fails to pay the Monthly Occupation Fee or any other
         monies due under this Agreement on the due date (whether formally
         demanded or not), the Occupier shall pay interest at 5% above the base
         rate of National Westminster Bank Plc from time to time on such overdue
         sums calculated from the due date to the date of payment (subject to a
         minimum interest payment of pounds200).

9.6      The Occupier shall pay all costs and expenses (including legal costs
         and surveyors' fees) which may be incurred by the Owner in connection
         with the recovery of arrears of the Monthly Occupation Fee or other
         monies payable under this Agreement or for the purposes of or
         incidental to the preparation and service of any notices or proceedings
         under section 146 of the Law of Property Act 1925 notwithstanding that
         forfeiture may be avoided otherwise than by relief granted by the
         Court.

9.7      All sums payable under this Agreement shall be paid to the Owner in
         pounds sterling in cleared funds for value to the Owner without any
         deduction for set off, counterclaim or tax.

10.      OCCUPIER'S COVENANTS

         The Occupier covenants with the Owner:

         REPAIR AND ALTERATIONS

10 1     not to make any alteration or addition to the Offices or the Building;

10.2     to keep the Offices and the Fixtures and Fittings in the same state of
         repair and condition as they are now in (fair wear and tear excepted);

10.3     not to damage any of the decorations or any of the Fixtures and
         Fittings or any equipment in the Offices or the Building;

10.4     not to display or affix any notice advertisement placard or name plate
         to any part of the Offices or Building;

10.5     not, without the previous written consent of the Owner, to install any
         fixtures, fittings or equipment in the Offices;

         ACCESS

10.6     to permit the Owner and those authorised by the Owner to enter the
         Offices for any reasonable purpose upon reasonable prior notice subject
         to such parties making good all damage thereby occasioned to the
         Offices or the Occupier's fixtures and fittings,

         ALIENATION

10 7     not to assign, charge, sublet or part with or share possession of the
         whole or any part or parts of the Offices;

         USE

10.8     to use the Offices only as high-class offices in connection with the
         Occupier's business;

10.9     to comply with all statutory requirements relating to the Offices,
         including but without limitation all town and country planning
         legislation;

10.10    to comply with the requirements of any insurers of the Offices and/or
         the Building and not to do or omit anything which would result in any
         policy of insurance in respect of the Offices and/or the Building
         becoming void or voidable or otherwise prejudiced, or which would cause
         the premium for such policy to be increased;
<PAGE>

                          [INTENTIONALLY LEFT BLANK]

                                       1

<PAGE>

10.11    to comply with all existing and future regulations as the Owner may
         from time to time impose in relation to the use of the Offices, the
         Building or facilities therein and/or the management of the Building
         and car parking;

10.12    not to do anything in the Offices or the Building which is or may
         become a nuisance or annoyance or cause danger, injury or damage to the
         Owner or other occupiers of the Building:

10.13    not to use the address of the Building or the Offices as the Occupier's
         registered office;

10.14    not to invite the public generally to come to the Offices or the
         Building and not to use the Offices, or the Building or the address of
         either or purport to use the Offices, or the Building or the address of
         either for any purpose which might attract casual callers;

10.15    not to use any electrical appliance within the Offices or the Building
         which has not been tested on a regular basis in accordance with the
         Electricity at Work Regulations (1989);

10.16    not to bring any animal into the Offices or the Building;

10.17    not to smoke in any part of the Offices or the Building or in the
         immediate vicinity of the Building

10.18    not to introduce any hazardous substances or known pollutants into the
         Offices of the Building.

10.19    not during the term of this Agreement or for a period of 6 months after
         the expiration of sooner determination of the term of this Agreement to
         employ (directly or indirectly) any person who has been in the
         employment of the Owner at the Building during the term and if the
         Occupier breaches the provisions of this clause the Occupier shall pay
         to the Owner on demand by way of liquidated damages an amount equal to
         40% of the gross annual remuneration of such employee

11.      OWNER'S COVENANTS

         Subject to the Occupier paying the Monthly Occupation Fee when due and
         performing and observing the obligations on its part contained in this
         Agreement, the Owner agrees:

11.1     that the Occupier may peaceably hold and enjoy the Offices during the
         Term without any interruption;

11.2     to use reasonable endeavours to provide the Inclusive Services:

11.3     to grant 24 hour access seven days a week to the Offices.

12.      PROVISOS

         The Owner and the Occupier agree as follows:

12.1     In either or both of the circumstances set out in Sub-clauses (a)-(b)
         of this Clause 12.1, it shall be lawful for the Owner or any person
         duly authorised by it to re-enter upon the Offices or any part thereof
         in the name of the Owner at which time this Agreement shall absolutely
         determine but without prejudice to any rights of the Owner in respect
         thereof or antecedent claim or breach of any of the terms of this
         Agreement:

(a)      If and whenever the Monthly Occupation Fee or any part of it is in
         arrears and unpaid for ten working days after becoming due (whether
         formally demanded or not);

(b)      if the Occupier at any time fails or neglects to perform or observe any
         of the covenants, terms, conditions of agreements contained in this
         Agreement;

12.2     Upon the expiry or sooner determination of this Agreement (for whatever
         reason) the Occupier shall:

(a)      immediately vacate the Offices;

(b)      remove all its goods and effects from the Offices; and
<PAGE>

(c)      cease to make use of or benefit from the Inclusive Services or
         Chargeable Services;

12.3     In default of immediate compliance with the obligations by the Occupier
         in clause 12.2, the provisions of this clause 12.3 shall apply:-

(a)      The Owner or any servant or agent of the Owner shall be entitled
         forthwith to enter the Offices and remove the Occupier's goods and
         effects and deposit the same (at the Occupier's own risk) in an
         appropriate part of the Building or elsewhere for collection.

(b)      Subject to Clause 12.3(c) the Occupier irrevocably appoints the Owner
         to be the Occupier's agent to sell or dispose of (at the Owner's
         absolute discretion) any goods and effects left by the Occupier for
         more than five days after the expiry or sooner determination of the
         Term subject to any conditions which the Owner thinks fit and without
         the Owner being liable to the Occupier save to account for the net
         proceeds of sale less the cost of storage (if any) and of sale and any
         other expenses reasonably incurred by the Owner.

(c)      Any goods or other effects left at the Offices by the Occupier shall be
         subject to a lien in favour of the Owner in respect of any liability of
         the Occupier to the Owner pursuant to or arising out of this Agreement
         and the Owner shall have power to sell or otherwise dispose of or
         direct the sale or disposal of all such goods and effects on whatever
         terms the Owner shall think fit and to apply the net proceeds of such
         sale or disposal (less any deductions as referred to in Clause 12.3(b))
         towards satisfaction of such liability.

12.4

(a)      The Owner does not exclude or limit its liability to the Occupier in
         respect of liability for death or personal injury to the extent that it
         results from the negligence of the Owner or its employees, agents or
         sub-contractors;

(b)      Except as provided in clause 12.4(a) the Owner shall not be liable to
         the Occupier nor shall the Occupier have any claim against the Owner in
         tort, contract or otherwise for any loss, damage, injury or expense
         arising out of or in connection with the Occupier's occupation of the
         Offices or the provision of any services by the Owner including
         (without prejudice to the generality of the foregoing) in respect of
         any loss of profit, production, anticipated savings, goodwill or
         business opportunities or any type of indirect, economic or
         consequential loss, even if that loss or damage was reasonably
         foreseeable or the Owner was aware of the possibility of that loss or
         damage arising.

12.5     If the Offices or any part shall at any time be destroyed so as to be
         unfit for occupation or use then, save to the extent that the insurance
         of the Offices shall have been invalidated or payment of the policy
         monies refused by or in consequence of any act, neglect, omission or
         default of the Occupier, the Monthly Occupation Fee, or a fair
         proportion of it according to the nature and extent of the damage
         sustained, shall be suspended from the date of such damage or
         destruction until the Offices shall have been rebuilt or reinstated and
         made fit for occupation, and any dispute concerning this provision
         shall be determined by an arbitrator in accordance with the Arbitration
         Act 1996.

12.6     The Owner shall be entitled to discontinue the provision of the
         Inclusive Services and/or the Chargeable Services in respect of any
         period or periods during which the Occupier shall be in breach of any
         of the provisions of this Agreement.

12.7     Section 196 of the Law of Property Act 1925 (as to service of notices)
         as amended by the Recorded Delivery Service Act 1962 shall apply to
         this Agreement provided that the addresses for service of notices on
         the Occupier or the Owner shall be those set out in Clauses 1 and 2
         respectively or such other addresses as either party may notify to the
         other from time to time.

13       EXCLUSION OF SECURITY OF TENURE

         Having been authorised so to do by order of the Court under the
         provisions of section 38(4) of the Landlord and Tenant Act 1954,
         details of which are set out in Clause 5, the Owner and the Occupier
         agree that the provisions of sections of 24-28 of the Act shall be
         excluded in relation to the tenancy hereby created.

                                       2
<PAGE>

                                   SCHEDULE

                             (INCLUSIVE SERVICES)

*    Business rates
*    Water rates
*    Reception services
*    Personalised telephone answering services
*    Heating
*    Lighting
*    Electricity
*    Cleaning
*    Repair and Maintenance of the Building
*    Insurance of the Building & Owner's contents
*    One switchboard extension with DDI facilities and standard handset per desk
     provided by the Owner
*    Subject to availability, courtesy Network access of two hours per month at
     the other UK centres and eight hours per month at all other worldwide
     centres in the HQ Business Centre network (hours may not be carried forward
     if unused).

Further details of the Inclusive Services are available on request from the
Owner.

                                       3