02052003 8K Exhibit 10.2




                                                 Exhibit 10.2


THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
DISTRIBUTION THEREOF. EXCEPT IN COMPLIANCE WITH RULE 144 PROMULGATED UNDER THE
SECURITIES ACT OF 1933 OR ANY OTHER AVAILABLE EXEMPTION FROM REGISTRATION, NO
SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF
1933.

SECURED CONVERTIBLE PROMISSORY NOTE
 

 
	

$[[PrincipalAmount]]

	

February 4, 2003

Fremont, California







For value received, Accrue Software, Inc., a Delaware
corporation (the "Company"), promises to pay to [[Purchaser]] (the "Holder"), the
principal sum of [[WrittenPrincipalAmount]] Dollars ($[[PrincipalAmount]]).
Interest shall accrue from the date of this Note on the unpaid principal amount
at a rate equal to 6.0% per annum, compounded annually.  This Note is one
of a series of Secured Convertible Promissory Notes containing substantially
identical terms and conditions issued pursuant to that certain Secured
Convertible Promissory Note Purchase Agreement dated February 4, 2003 (the
"Purchase Agreement").  Such Notes are referred to herein as
the "Notes," and the holders thereof are referred to herein as
the "Holders."  All other capitalized terms not defined
herein shall have the meanings ascribed to such terms in the Purchase Agreement.
This Note is subject to the following terms and conditions.

1.Maturity.  Unless converted as
provided in Section 2, this Note will automatically mature and be due and
payable on February 4, 2006 (the "Maturity Date").  Subject to
Section 2 below, interest shall accrue on this Note but shall not be due
and payable until the Maturity Date. Notwithstanding the foregoing, the entire
unpaid principal sum of this Note, together with accrued and unpaid interest
thereon, shall become immediately due and payable upon the occurrence of any
Event of Default (as defined herein).

2.Conversion.  The Notes shall be converted
into equity securities of the Company (each a "Conversion")
upon the terms and conditions set forth below:

(a)  Optional Conversion.   Upon the written
request of the Holders of a majority of the outstanding principal amount of the
Notes (the "Majority Holders"), the entire principal amount of
and (if requested by the Majority Holders) accrued interest on this and
all other Notes shall be converted at the option of the Majority Holders either
into shares of the Company's Common Stock or, in the event that there is a
series of Preferred Stock of the Company issued or proposed to be issued, into
the most senior series of such Preferred Stock. If the Majority Holders, as the
case may be, elect to convert accrued interest into equity securities upon a
Conversion, this election shall apply equally to all of the Notes.



(b)Automatic Conversion. In the
event that the closing bid or sales prices (whichever is applicable) of the
Company's Common Stock is at least $0.20 per share (as adjusted for stock
splits, stock dividends, recapitalizations and like transactions) for a period
of 60 consecutive trading days, the entire principal amount of and accrued
interest on this and all other Notes shall automatically be converted (an
"Automatic Conversion") into shares of the Company's Common
Stock.   The Company shall promptly thereafter provide the Holder written notice
of the terms, effect and mechanics of such Automatic Conversion.

(c)Conversion Price. The number of shares
of Common Stock or Preferred Stock, as applicable, to be issued upon a
Conversion shall be equal to the quotient obtained by dividing (i) the entire
principal amount of this Note plus (as applicable) accrued interest by (ii)
$0.06 (as adjusted pursuant to Section 2(d)) (the "Conversion
Price"), rounded to the nearest whole share.  

(d)Conversion Price Adjustments.  The Conversion Price
shall be subject to adjustment from time to time as follows:  

(i)Issuance of Additional Stock below Purchase Price. If
the Company should issue, at any time after the date on which the first Note was
sold (the "Purchase Date"), any Additional Stock (as defined
below) without consideration or for a consideration per share less than the
Conversion Price in effect immediately prior to the issuance of such Additional
Stock, the Conversion Price in effect immediately prior to each such issuance
shall automatically be adjusted as set forth in this Section 2(d), unless
otherwise provided in this Section 2(d).

(A)Price Adjustment Formula.  Whenever the Conversion Price
is adjusted pursuant to this Section 2(d), the Conversion Price shall be
adjusted to a price equal to the price paid per share for such Additional
Stock.

(B)Definition of "Additional Stock".   For
purposes of this Section 2(d), "Additional Stock" shall mean
any shares of Common Stock issued (or deemed to have been issued pursuant to
Section 2(d)(D) by the Company after the Purchase Date) other than 

(1)Common Stock issued pursuant to stock dividends, stock splits or
similar transactions;

(2)Shares of Common Stock issued or issuable to employees, consultants or
directors of the Company pursuant to a stock option plan or restricted stock
plan or incentive arrangement approved by the Board of Directors of the
Company;

(3)Capital stock, or options or warrants to purchase capital stock,
issued to financial institutions or lessors in connection with commercial credit
arrangements, equipment financings, commercial property lease transactions or
similar transactions approved by the Board of Directors where the principal
purpose thereof is not to raise additional equity capital for the Company;

(4)Capital stock, or warrants or options to purchase capital stock,
issued in connection with bona fide acquisitions, mergers or similar
transactions, the terms of which are approved by the Board of Directors of the
Company;

(5)Shares of Common Stock issued or issuable upon conversion of the
Preferred Stock of the Company; and

(6)Capital stock issued or issuable to an entity as a component of any
business relationship with such entity for the purpose of (A) joint
venture, technology licensing or development activities, (B) distribution,
supply or manufacture of the Company's products or services or (C) any
other arrangements involving corporate partners that are primarily for purposes
other than raising capital, the terms of which business relationship with such
entity are approved by the Board of Directors.

(C)Determination of Consideration.In the case of the
issuance of Common Stock for cash, the consideration shall be deemed to be the
amount of cash paid therefor before deducting any reasonable discounts,
commissions or other expenses allowed, paid or incurred by the Company for any
underwriting or otherwise in connection with the issuance and sale thereof.   In
the case of the issuance of the Common Stock for a consideration in whole or in
part other than cash, the consideration other than cash shall be deemed to be
the fair value thereof as determined by the Board of Directors.

(D)Deemed Issuances of Common Stock.  In the case of the
issuance after the Purchase Date of securities or rights convertible into, or
entitling the holder thereof to receive directly or indirectly, additional
shares of Common Stock (the "Common Stock Equivalents"), the
following provisions shall apply for all purposes of this Section 2(d):

(1)The aggregate maximum number of shares of Common Stock deliverable
upon conversion, exchange or exercise (assuming the satisfaction of any
conditions to convertibility, exchangeability or exercisability, including,
without limitation, the passage of time, but without taking into account
potential antidilution adjustments) of any Common Stock Equivalents and
subsequent conversion, exchange or exercise thereof shall be deemed to have been
issued at the time such securities were issued or such Common Stock Equivalents
were issued and for a consideration equal to the consideration, if any, received
by the Company for any such securities and related Common Stock Equivalents
(excluding any cash received on account of accrued interest or accrued
dividends), plus the minimum additional consideration, if any, to be received by
the Company (without taking into account potential antidilution adjustments)
upon the conversion, exchange or exercise of any Common Stock Equivalents (the
consideration in each case to be determined in the manner provided in Section
2(d)(i)(C).

(2)In the event of any change in the number of shares of Common Stock
deliverable or in the consideration payable to the Company upon conversion,
exchange or exercise of any Common Stock Equivalents including, but not limited
to, a change resulting from the antidilution provisions thereof, the Conversion
Price, to the extent in any way affected by or computed using such Common Stock
Equivalents, shall be recomputed to reflect such change, but no further
adjustment shall be made for the actual issuance of Common Stock or any payment
of such consideration upon the conversion, exchange or exercise of such Common
Stock Equivalents.

(3)Upon the termination or expiration of the convertibility,
exchangeability or exercisability of any Common Stock Equivalents, the
Conversion Price, to the extent in any way affected by or computed using such
Common Stock Equivalents, shall be recomputed to reflect the issuance of only
the number of shares of Common Stock (and Common Stock Equivalents that remain
convertible, exchangeable or exercisable) actually issued upon the conversion,
exchange or exercise of such Common Stock Equivalents.

(4)The number of shares of Common Stock deemed issued and the
consideration deemed paid therefor pursuant to Section 2(d)(i)(D)(1) shall be
appropriately adjusted to reflect any change, termination or expiration of the
type described in either Section 2(d)(i)(D)(2) or 2(d)(i)(D)(3).

(E)Limits on Conversion Price Adjustments.  Notwithstanding
any other provisions of this Section (2)(d)(i), no adjustment of the Conversion
Price pursuant to this Section 2(d)(i) shall (1) except to the limited extent
provided for in Sections 2(d)(i)(D)(2) and 2(d)(i)(D)(3), have the effect of
increasing the Conversion Price above the Conversion Price in effect immediately
prior to such adjustment, and (2) have the effect of decreasing the Conversion
Price below the fair market value of the Company's Common Stock as of the
Closing (as defined in the Purchase Agreement)(as adjusted for stock splits,
stock dividends, recapitalizations and like transactions).

(ii)Stock Splits and Dividends.  In the event the Company
should at any time after the Purchase Date fix a record date for the
effectuation of a split or subdivision of the outstanding shares of Common Stock
or the determination of holders of Common Stock entitled to receive a dividend
or other distribution payable in additional shares of Common Stock or Common
Stock Equivalents without payment of any consideration by such holder for the
additional shares of Common Stock or the Common Stock Equivalents (including the
additional shares of Common Stock issuable upon conversion or exercise thereof),
then, as of such record date (or the date of such dividend distribution, split
or subdivision if no record date is fixed), the Conversion Price shall be
appropriately decreased so that the number of shares of Common Stock issuable on
conversion of this Note shall be increased in proportion to such increase in
outstanding shares of Common Stock and Common Stock Equivalents.

(iii)Reverse Stock Splits.  If the number of shares of
Common Stock outstanding at any time after the Purchase Date is decreased by a
combination of the outstanding shares of Common Stock, then, following the
record date of such combination, the Conversion Price shall be appropriately
increased so that the number of shares of Common Stock issuable on conversion of
this Note shall be decreased in proportion to such decrease in outstanding
shares.

(e)Mechanics and Effect of Conversion.  No
fractional shares of the Company's capital stock will be issued upon conversion
of this Note.  In lieu of any fractional share to which the Holder would
otherwise be entitled, the Company will pay to the Holder in cash the amount of
the unconverted principal and interest balance of this Note that would otherwise
be converted into such fractional share.  Upon conversion of this Note pursuant
to this Section 2, the Holder shall surrender this Note, duly endorsed, at the
principal offices of the Company or any transfer agent of the Company.  At its
expense, the Company will, as soon as practicable thereafter, issue and deliver
to such Holder, at such principal office, a certificate or certificates for the
number of shares to which such Holder is entitled upon such conversion, together
with any other securities and property to which the Holder is entitled upon such
conversion under the terms of this Note, including a check payable to the Holder
for any cash amounts payable as described herein.  Upon conversion of this Note,
the Company will be forever released from all of its obligations and liabilities
under this Note with regard to that portion of the principal amount and accrued
interest being converted including without limitation the obligation to pay such
portion of the principal amount and accrued interest.

(f)Payment of Interest.  Upon conversion of
the principal amount of this Note into the Company's equity securities, any
interest accrued on this Note that is not by reason of Section 2(a) or 2(b)
hereof simultaneously converted into equity securities shall be immediately paid
to the Holder.

(g)  Regulatory Compliance.  Notwithstanding the foregoing,
in the event that the Company's Common Stock is listed on the Nasdaq Stock
Market or another national securities exchange (or a listing application is
pending with any such exchange), a Conversion of this Note (or a conversion into
Common Stock of Preferred Stock issued pursuant to a Conversion of this Note)
shall only be effective to the maximum extent permissible under the applicable
rules and regulations of such an exchange without the approval of the
transaction by the Company's stockholders.  In the event such stockholder
approval is required to give full effect to the Conversion of this Note, the
maximum amount of principal and accrued interest (or the maximum number of
shares of convertible Preferred Stock) that is permissible to be converted
without the approval of the Company's stockholders shall be converted as
otherwise provided herein and the Company shall promptly seek to obtain the
stockholder approval necessary to give full effect to the Conversion.  


3.Payment.  

(a)  Payment.  Except as expressly
contemplated herein, all payments shall be made in lawful money of the United
States of America at such place as the Holder hereof may from time to time
designate in writing to the Company.  Payment shall be credited first to the
accrued interest then due and payable and the remainder applied to principal.


(b)  Mandatory Prepayment on Liquidation.
If a Liquidation Event (as defined below) is consummated prior to the Maturity
Date or a Conversion, the Company shall pay the Holder an amount (the
"Liquidation Amount") equal to 150% of the principal amount of
this Note, plus accrued interest. The Liquidation Amount shall be paid in cash
unless the Majority Holders consent in writing to the payment of all or any
portion of the Liquidation Amount in consideration other than cash.   The value
of any such consideration other than cash shall be deemed to be the fair value
thereof as determined by the Board of Directors irrespective of any accounting
treatment.  Upon payment of the Liquidation Amount, the Company will be forever
released from all of its obligations and liabilities under this Note.  For
purposes of this Note, a "Liquidation Event" shall mean (i) a
sale of all or substantially all of the assets or business of the Company
whether by merger, sale of assets, sale of stock or otherwise, (ii) any
reorganization, consolidation or merger of the Company where the outstanding
voting securities of the Company immediately before the transaction represent or
are converted into less than 50% of the outstanding voting power of the
surviving entity (or its parent entity) immediately after the transaction, (iii)
a sale or exchange of the Company's capital stock by the stockholders of the
Company in one transaction or a series of related transactions where more than
50% of the outstanding voting power of the Company is acquired by a person or
entity or group of related persons or entities, or (iv) any liquidation or
dissolution of the Company, whether by bankruptcy, a general assignment for the
benefit of creditors, receivership or otherwise. 

(c)Notices of Certain Transactions.  In
case of any consolidation or merger of the Company, any consolidation or merger
of the Company with or into another corporation (other than a consolidation or
merger in which the Company is the surviving entity), or any transfer of all or
substantially all of the assets of the Company (a "Change of
Control"), the Company will mail or cause to be mailed to the Holder a
notice specifying the effective date on which such consolidation, merger or
transfer, and the time, if any is to be fixed, as of which the holders of record
of Common Stock are to be determined.  Such notice shall be mailed at least
twenty (20) days prior to the record date or effective date for the event
specified in such notice.  In the event that the Majority Holders submit a
written request for Conversion in connection with a Change of Control (a
"Change of Control Conversion Request"), such Change of Control
Conversion Request will be conditioned on, and will be effected immediately
prior to, the occurrence of such Change of Control.  At such time, the
respective Holders of the Notes shall be deemed to have become the respective
holders of record of the capital stock of the Company issued pursuant to the
Conversion.

4.Events of Default.  

(a)Definition.  The occurrence of any of the
following shall constitute an "Event of Default" under this Note:

(i)Failure to Pay.  The Company's failure
to pay any principal or interest or any other amount required to be paid by it
under the terms of this Note on the date due, and such failure shall continue
for five (5) business days after the Holder has given written notice of such
default to the Company; 



(ii)Failure to Comply With
Covenants.  The Company's failure to perform or observe any other
material covenant or agreement contained in any Note or the Purchase Agreement,
and such failure shall continue for fifteen (15) business days after the Holder
has given written notice of such failure to the Company (provided, however, that
no notice from the Holder shall be required to commence the 15 business day cure
period if the Company has knowledge of failure to perform or observe any such
material covenant or agreement and has not complied with Section 4(b)
hereof);


(iii)Voluntary Bankruptcy or Insolvency
Proceedings. The Company's (A) applying for or consenting to
the appointment of a receiver, trustee, liquidator or custodian of itself or of
all or a substantial part of its property, (B) making a general assignment
for the benefit of all or any of its creditors, (C) commencing dissolution
or liquidation proceedings, (D) commencing any voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or consenting to any such relief or to the appointment of or
taking possession of its property by any official in an involuntary case or
other proceeding commenced against it, or (E) taking any action for the
purpose of effecting any of the foregoing; or


(iv)Involuntary Bankruptcy or
Insolvency Proceedings. Commencement of any proceedings for the
appointment of a receiver, trustee, liquidator or custodian of Company or of all
or a substantial part of the property thereof, or an involuntary case or other
proceedings seeking liquidation, reorganization or other relief with respect to
the Company or the debts thereof under any bankruptcy, insolvency or other
similar law now or hereafter in effect shall be commenced and an order for
relief entered or such proceeding shall not be dismissed or discharged within
thirty (30) days of commencement.


(v)Default on Other Obligations.  The occurrence of a
default or event of default in any agreement between the Company and a third
party that gives the third party the right to accelerate any indebtedness
exceeding $500,000 or more or that could have a Material Adverse Effect (as
defined in the Purchase Agreement) on the Company; and such failure shall
continue for fifteen (15) business days after written notice of such default to
the Company.


(vi)Failure to Obtain Stockholder Approval.  The
Company does not receive the requisite approval of its stockholders pursuant to
Section 2(g) hereof within 120 days of written request to obtain such approval
from the Majority Holders.


(b)Notice.  The Company shall, as
promptly as possible and in any event within three (3) business days of the
occurrence thereof, notify the Holder of the occurrence of an Event of Default
(i.e. upon the occurrence of one of the events described in Section 4(a) above
without giving effect to the cure periods or notices required under clauses (i),
(ii) and (v) thereof).


(c)Remedies.  Upon the occurrence of
any Event of Default, the Majority Holders, at their option, may (i) by notice
to the Company, declare the unpaid principal amount of this Note, all interest
accrued and unpaid hereon and all other amounts payable hereunder to be
immediately due and payable, whereupon the unpaid principal amount of this Note,
all such interest and all such other amounts shall become immediately due and
payable, without presentment, demand, protest or further notice of any kind,
provided that if an event described in Section 4(a)(iii) or (iv) shall occur,
all interest and all such other amounts shall become immediately due and payable
automatically, without the giving of any such notice; and (ii) whether or not
the actions referred to in clause (i) have been taken, exercise any or all of
the Holders' rights and remedies under the Purchase Agreement and proceed to
enforce all other rights and remedies available to the Holders under applicable
law.  



5.Transfer; Successors and Assigns.  The
terms and conditions of this Note shall inure to the benefit of and be binding
upon the respective successors and assigns of the parties.  Notwithstanding the
foregoing, the Holder may not assign, pledge, or otherwise transfer this Note
without the prior written consent of the Company, which consent shall not be
unreasonably withheld.  Subject to the preceding sentence, this Note may be
transferred only upon surrender of the original Note for registration of
transfer, duly endorsed, or accompanied by a duly executed written instrument of
transfer in form satisfactory to the Company.  Thereupon, a new note for the
same principal amount and interest will be issued to, and registered in the name
of, the transferee.  Interest and principal are payable only to the registered
holder of this Note.



6.Governing Law.  This Note and all acts
and transactions pursuant hereto and the rights and obligations of the parties
hereto shall be governed, construed and interpreted in accordance with the laws
of the State of California, without giving effect to principles of conflicts of
law.  

7.Notices.  Any notice required or
permitted by this Agreement shall be in writing and shall be deemed sufficient
upon receipt, when delivered personally or by courier, overnight delivery
service or confirmed facsimile, or 48 hours after being deposited in the U.S.
mail as certified or registered mail with postage prepaid, if such notice is
addressed to the party to be notified at such party's address or facsimile
number as set forth below or as subsequently modified by written
notice.

8.Amendments and Waivers.  Any term of this
Note may be amended only with the written consent of the Company and the
Majority Holders.  Any amendment or waiver effected in accordance with
this Section 8 shall be binding upon the Company, each Holder and each
transferee of any Note.

9. Stockholders, Officers and Directors Not
Liable.  In no event shall any stockholder, officer or director of the
Company be liable for any amounts due or payable pursuant to this Note.

10.Seniority.  The indebtedness evidenced
by this Note is hereby expressly senior in right of payment to the prior payment
of all other indebtedness of the Company other than Permitted Senior
Indebtedness (as defined in the Purchase Agreement), and the Company shall not
be permitted to incur secured indebtedness which is senior in right of payment
to the Notes other than Permitted Senior Indebtedness while this Note is
outstanding.  

11. Subordination.  The indebtedness
evidenced by this Note is hereby expressly subordinated, to the extent and in
the manner hereinafter set forth, in right of payment to the prior payment in
full of all of the Company's Permitted Senior Indebtedness. Upon any
receivership, insolvency, assignment for the benefit of creditors, bankruptcy,
reorganization, or arrangement which creditors (whether or not pursuant to
bankruptcy or other insolvency laws), sale of all or substantially all of the
assets, dissolution, liquidation, or any other marshaling of the assets and
liabilities of the Company or in the event this Note shall be declared due and
payable, (i) no amount shall be paid by the Company, whether in cash or
property in respect of the principal of or interest on this Note at the time
outstanding, unless and until the full amount of any Permitted Senior
Indebtedness then outstanding shall be paid in full (but only to the extent of
the value of the collateral securing any such Permitted Senior Indebtedness),
and (ii) no claim or proof of claim shall be filed with the Company by or
on behalf of the holder of this Note which shall assert any right to receive any
payments in respect of the principal of and interest on this Note except subject
to the payment in full all of the Permitted Senior Indebtedness then outstanding
(but only to the extent of the value of the collateral securing any such
Permitted Senior Indebtedness).

Nothing contained in the preceding paragraphs shall impair,
as between the Company and the Holder, the obligation of the Company, which is
absolute and unconditional, to pay to the Holder hereof the principal hereof and
interest hereon as and when the same shall become due and payable, or shall
prevent the Holder, upon default hereunder, from exercising all rights, powers
and remedies otherwise provided herein or by applicable law, all subject to the
rights, if any, of the holders of Permitted Senior Indebtedness under the
preceding paragraphs to receive cash or other properties otherwise payable or
deliverable to the Holder pursuant to this Note.

At any time and from time to time, upon the written request
of the Company, the Holders will promptly and duly authenticate and deliver such
instruments and documents and take such further action as the Company may
reasonably request to give effect to the purpose and intent of this Section 11,
including without limitation to permit the creation of Permitted Liens (as
defined in the Purchase Agreement). 

12.Security Interest.  The Company hereby grants to the
Holder a first priority security interest (subject to Permitted Liens created to
secure Senior Permitted Indebtedness) in all assets and property now or
hereafter owned or held by the Company, including without limitation: accounts,
inventory, goods, equipment, fixtures, general intangibles (including goodwill
and all intellectual property, including without limitation patents, patent
applications, copyrights, trademarks and trade names), contract rights,
royalties, documents, cash, securities, letters of credit, certificates of
deposit, notes, instruments, chattel paper, deposit accounts, other financial
assets, claims (whether by litigation, settlement, payment through insurance or
otherwise, and including claims of past, present and future infringement) and
all proceeds of the foregoing (the "Collateral").   In
addition, the Company hereby appoints Holder as its attorney-in-fact for the
purpose of signing and filing any uniform commercial code financial statements
or other documents considered necessary or appropriate by Holder to perfect or
enhance the foregoing grant of Holder's security interest, or deliver any
notices required thereunder.

13.Usury.  Anything herein to the contrary notwithstanding,
if during any period for which interest is computed hereunder, the amount of
interest computed on the basis provided for in this Note, together with all
fees, charges and other payments which are treated as interest under applicable
law, as provided for herein or in any other document executed in connection
herewith, would exceed the amount of such interest computed on the basis of the
Highest Lawful Rate, the Company shall not be obligated to pay, and the Holder
shall not be entitled to charge, collect, receive, reserve or take, interest in
excess of the Highest Lawful Rate, and during any such period the interest
payable hereunder shall be computed on the basis of the Highest Lawful Rate.  As
used herein, "Highest Lawful Rate" means the maximum non-
usurious rate of interest, as in effect from time to time, which may be charged,
contracted for, reserved, received or collected by the Holder in connection with
this Note under applicable law.

14.Expenses.  The Company agrees to pay on demand all the
losses, costs, and expenses (including, without limitation, attorneys' fees and
disbursements) which the Holder incurs in connection with enforcement or
attempted enforcement of this Note, or the protection or preservation of the
Holder's rights under this Note, whether by judicial proceedings or otherwise.
Such costs and expenses include, without limitation, those incurred in
connection with any workout or refinancing, or any bankruptcy, insolvency,
liquidation or similar proceedings.

15.Waivers.  The Company hereby waives diligence, demand,
presentment, protest or further notice of any kind.  The Company agrees to make
all payments under this Note without setoff or deduction and regardless of any
counterclaim or defense.  No single or partial exercise of any power under this
Note shall preclude any other or further exercise of such power or exercise of
any other power.  No delay or omission on the part of the Holder in exercising
any right under this Note shall operate as a waiver of such right or any other
right hereunder.

16.Counterparts.  This Note may be executed in
any number of counterparts, each of which will be deemed to be an original and
all of which together will constitute a single agreement.

17.Loss of Note.  Upon receipt by the
Company of evidence satisfactory to it of the loss, theft, destruction or
mutilation of this Note or any Note exchanged for it, and indemnity satisfactory
to the Company (in case of loss, theft or destruction) or surrender and
cancellation of such Note (in the case of mutilation), the Company will make and
deliver in lieu of such Note a new Note of like tenor.

COMPANY:


ACCRUE SOFTWARE, INC.


By:


Name:

(print)

Title:


Address:  48634 Milmont Drive

Fremont, CA 94538-7353


Facsimile: (510) 580-4501
















AGREED TO AND ACCEPTED:


[[Purchaser]]


By:  ___________________________


Name: _________________________

           (print)

Title:  __________________________


Address:[[Address1]]

[[Address2]]


Facsimile: