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                                                                   EXHIBIT 10.15

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INDUSTRIAL & COMMERCIAL REAL ESTATE

                  This Lease, executed in duplicate at Palo Alto, California,
                  this 28 day of September, 1999

PARTIES           by and between

                  Kifer Investment Co.

                  and

                  Cobalt Networks, Inc., a California corporation

                  hereinafter called respectively Lessor and Lessee, without
                  regard to number or gender.

PREMISES          1. Witnesseth: That Lessor hereby leases to Lessee, and Lessee
                  hires from Lessor, those certain premises, hereinafter in this
                  lease  designated as "the Premises,"  with the  appurtenances,
                  situated in the City of Mountain View,  County of Santa Clara,
                  State  of  California,  and  more  particularly  described  as
                  follows, to-wit:

                  An approximate 29,842 square foot industrial building commonly
                  referred to as 515 Ellis Street.

USE               2. The  Premises  shall be used and occupied by Lessee for the
                  purpose  of  general  office,  sales,  service,   engineering,
                  research & development,  manufacturing  and any related lawful
                  purpose in conformity to municipal zoning requirements and any
                  CC&R  applicable  to the  property  and for no  other  purpose
                  without the prior written consent of Lessor.

TERM              3. The term shall be for four (4 years) 48 months,  commencing
                  on the 1st day of April, 2000 and  terminating on the 31st day
                  of March 2004.

RENTAL            4. Rent shall be payable to the Lessor  without  deduction  or
                  offset  initially at 2500 E1 Camino Real,  Palo Alto, CA 94306
                  or at such place or places as may be  designated  from time to
                  time by the Lessor as follows:

                  Twenty Thousand and NO/100ths Dollars ($20,000.000),  due upon
                  execution of this Lease representing  partial rental due April
                  1, 2000. An additional Fifty Thousand One Hundred Twenty Eight
                  and  70/100ths  Dollars  ($50,128.70  shall be due on April 1,
                  2000.  Seventy Thousand One Hundred Twenty Eight and 70/100ths
                  dollars  ($70,128.70)  shall be due on May 1,  2000 and on the
                  first  day of each and  every  month  through  March 1,  2001.
                  Seventy  Three  Thousand  One  Hundred  Twelve  and  90/100ths
                  Dollars  ($73,112.90) shall be due on April 1, 2001 and on the
                  first  day of each and  every  month  through  March 1,  2002.
                  Seventy  Six  Thousand  Ninety  Seven  and  10/100ths  Dollars
                  ($76,097.10)  shall be due on April 1,  2002 and on the  first
                  day of each and every  month  through  March 1, 2003.  Seventy
                  Nine Thousand  Eighty One and 30/100ths  Dollars  ($79,081.30)
                  shall be due on April 1, 2003 and on the first day of each and
                  every month through March 1, 2004.

SECURITY          5. On April 1, 2000 Lessee shall deposit with Lessor Seventy
                  Nine Thousand Eighty One Dollars and
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DEPOSIT           .30/100ths  ($79,081.30)  as  security  for the full and
                  faithful  performance  of  each  and  every  term,  provision,
                  covenant  and  condition  of this Lease.  In the event  Lessee
                  defaults in respect of any of the terms, provisions, covenants
                  or conditions of this Lease, including, but not limited to the
                  payment of rent,  Lessor may use, apply or retain the whole or
                  any  part of such  security  for the  payment  of any  rent in
                  default  or for any  other sum  which  Lessor  may spend or be
                  required to spend by reason of Lessee's default. Should Lessee
                  faithfully and fully comply with all of the terms, provisions,
                  covenants and  conditions  of this Lease,  the security of any
                  balance  thereof shall be returned to Lessee or, at the option
                  of Lessor,  to the last assignee of Lessee's  interest in this
                  Lease at the  expiration of the term hereof.  Lessee shall not
                  be entitled to any interest on said security deposit.

POSSESSION        6.  If  Lessor,  for any  reason  whatsoever,  cannot  deliver
                  possession  of the Premises to Lessee at the  commencement  of
                  the said term, as hereinbefore specified, this Lease shall not
                  be void or voidable,  nor shall Lessor, or Lessor's agents, be
                  liable to Lessee for any loss or damage  resulting  therefrom;
                  but in that event the  commencement  and termination  dates of
                  the  Lease  and all  other  dates  affected  thereby  shall be
                  revised  to  conform  to the  date  of  Lessor's  delivery  of
                  possession.  The above is,  however,  subject to the provision
                  that the period of delay of delivery of the Premises shall not
                  exceed Thirty (30) days from the commencement  date herein. If
                  the period of delay of delivery exceeds the foregoing, Lessee,
                  at his or it's option, may declare this Lease null and void.

ACCEPTANCE        7. By entry  hereunder,  the Lessee  accepts the Premises as
OF                being in good and  satisfactory  condition,  unless  within
PREMISES          Sixty  (60) days after such  entry  Lessee  shall give  Lessor
AND               written notice  specifying in reasonable  detail the
CONSENT TO        respects  in  which  the  Premises  were  not in  satisfactory
SURRENDER         condition,  and Lessor shall promptly  repair such items.
                  The Lessee  agrees on the last day of the term  hereof,  or on
                  sooner  termination of this Lease,  to surrender the Premises,
                  together with all  alterations,  additions,  and  improvements
                  which have been made in, to, or on the  Premises  by Lessor or
                  Lessee,  unto Lessor in the same good condition as at Lessee's
                  entry into the  Premises  excepting  for such wear and tear as
                  would be normal for the period of the Lessee's occupancy, Acts
                  of  God,  casualty,  condemnation,   hazardous  materials  not
                  stored,  used or  disposed of by Lessee and  alterations  with
                  respect to which Lessor has not required removal.  The Lessee,
                  on or before the end of the term or sooner termination of this
                  Lease,  shall remove all Lessee's  personal property and trade
                  fixtures  from the Premises and all property not removed shall
                  be deemed  abandoned  by the  lessee.  If the  Premises be not
                  surrendered  at the end of term or sooner  termination of this
                  Lease,  the Lessee shall  indemnify the Lessor against loss or
                  liability   resulting   from   delay  by  the   Lessee  in  so
                  surrendering the Premises including,  without, limitation, any
                  claims made by any succeeding tenant founded on such delay.

USES              8. Lessee shall not commit,  or permit to be committed,  any
PROHIBITED        waste upon the Premises, or any nuisance,or other act or thing
                  which may disturb the quiet  enjoyment  of any other tenant in
                  or around the  buildings in which the Premises may be located,
                  or allow any sale by auction upon the  Premises,  or allow the
                  premises  to be used for any  unlawful  purpose,  or place any
                  loads  upon the  floor,  walls,  or roof  which  endanger  the
                  structure, or place any harmful liquids in the drainage system
                  of the building.  No waste materials or refuse shall be dumped
                  upon or  permitted  to  remain  upon any part of the  Premises
                  outside  of  the  building  proper.  No  materials,  supplies,
                  equipment,  finished products or semi-finished  products,  raw
                  materials  or articles  of any nature  shall be stored upon or
                  permitted to remain on any portion of the Premises  outside of
                  the buildings proper.

ALTERATIONS       9. Except for  nonstructural alterations not exceeding Seventy
AND               Five Hundred Dollars ($7500.00) per work of improvement, the
ADDITIONS         Lessee shall make no alterations,  additions,  or improvements
                  to the Premises or any part thereof  without  first  obtaining
                  the prior  written  consent of the Lessor,  which shall not be
                  unreasonably  withheld or delayed.  The Lessor may impose as a
                  condition to the aforesaid consent such requirements as Lessor
                  may  reasonably   deem   necessary  in  Lessor's   discretion,
                  including without  limitation  thereto the manner in which the
                  work is done,  a right of approval of the  contractor  by whom
                  the  work  is to be  performed  which  approval  shall  not be
                  unreasonably withheld or delayed, the times during which it is
                  to be  accomplished,  and the  requirement  that upon  written
                  request  of  Lessor  made at the  time  that  Lessee  requests
                  consent  to  such,   prior  to  :the   expiration  or  earlier
                  termination  of  the  Lease,  Lessee  will  remove  any or all
                  improvements  or  additions  to  the  Premises   installed  at
                  Lessee's   expense.   All  such   alterations,   additions  or
                  improvements   not  specified  to  be  removed  shall  at  the
                  expiration or earlier termination of the lease become property
                  of the  Lessor  and remain  upon and be  surrendered  with the
                  Premises. All movable furniture,  business and trade fixtures,
                  or machinery and equipment shall remain in the property of the
                  Lessee and may be removed by the Lessee at any time during the
                  Lease
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                  term when  Lessee is not in  default  beyond  applicable  cure
                  period. Items which are not to be deemed as movable furniture,
                  business and trade fixtures,  or machinery and equipment shall
                  include   heating,    lighting,    electrical   systems,   air
                  conditioning, hard wall partitioning,  carpeting, or any other
                  installation   which  has  become  an  integral  part  of  the
                  Premises.  The  Lessee  will at all times  permit  notices  of
                  non-responsibility to be posted and to remain posted until the
                  completion  of  alterations  or  additions   which  have  been
                  approved by the Lessor.

MAINTE-           10.  Subject to the  Memorandum  of  Understanding,  Lessee
NANCE OF          shall, at Lessee's  sole cost,  keep and maintain the Premises
PREMISES          and appurtenances and every  part thereof,  including  but not
                  limited  to,  glazing,  sidewalks,  parking  areas,  plumbing,
                  electrical    systems,    heating    and   air    conditioning
                  installations,  any store front,  roof covering - unless it is
                  not  feasible to repair the existing  roof  coveting and a new
                  roof is  required,  and the  interior of the  Premises in good
                  order, condition, and repair. Lessor at the Lessor's sole cost
                  and expense  shall  maintain  the  exterior of the walls,  and
                  structural portions of the roof, foundations, walls and floors
                  except  for any  repairs  caused  by the  wrongful  act of the
                  Lessee and Lessee's  agents.  The Lessor will replace the roof
                  covering   if   repairs  to  said   coveting   are  no  longer
                  economically feasible in the judgement of roofing experts, and
                  provided said replacement is not made necessary by acts of the
                  Lessee and Lessee's agents.  The Lessee shall water,  maintain
                  and replace,  when  necessary,  any shrubbery and  landscaping
                  provided by the Lessor on the Premises.  The Lessee  expressly
                  waives the  benefits of any statute now or hereafter in effect
                  which  would  otherwise  afford  the  Lessee the right to make
                  repairs at Lessor's  expense or to terminate this Lease became
                  of  Lessor's  failure  to keep  the  Premises  in good  order,
                  conditions or repair.

FIRE AND          11. See revised insurance clause attached.
EXTENDED
COVERAGE
INSURANCE
AND
SUBROGATION

ABANDON-          12. Lessee shall not vacate or abandon the Premises while in
MENT              default of it's  obligation  to pay rent;  and if Lessee shall
                  abandon,  vacate, or surrender,  the Premises while in default
                  of it's  obligation to pay rent, or be dispossessed by process
                  of law, or  otherwise,  any  personal  property  belonging  to
                  Lessee and left on the Premises shall be deemed abandoned,  at
                  the  option of the  Lessor,  except  such  property  as may be
                  mortgaged to Lessor.

FREE FROM         13.  Lessee  shall keep the  Premises  and the  property  in
LIENS             which the Premises  are  situated,  free  from  any lien
                  arising out of any work  performed,  materials  furnished,  or
                  obligations incurred by Lessee.

COMPLIANCE        14.  As  of  commencement  date,  Premises  is  in  compliance
WITH              with applicable law. Lessee shall, at his sole cost and
GOVERN-           expense, comply will all the requirements of all Municipal,
MENTAL            State, and Federal authorities, which may  hereafter be in
REGULATIONS       force,  pertaining  to the Lessee's  particular  use of the
                  Premises  and shall  faith-  fully  observe  in the use of the
                  Premises  all  Municipal  ordinances  and  State  and  Federal
                  statutes now in force or which may hereafter be in force.  The
                  judgement  of any  court  of  competent  jurisdiction,  or the
                  admission  of  Lessee  in any  action  or  proceeding  against
                  Lessee,  whether Lessor be a party thereto or not, that Lessee
                  has violated  any such  ordinance or statute in the use of the
                  Premises,  shall be conclusive  of the fact as between  Lessor
                  and Lessee.  With respect to cost incurred to comply with laws
                  of applicability to owners of commercial  property in general,
                  Lessor shall pay such costs, amortized over the useful life of
                  the  improvement and Lessee shall pay the Lessor the amortized
                  costs  falling  due during the term as  extended  on a monthly
                  basis.

INDEMNI-          15. The Lessee,  as a material part of the consideration to be
FICATION OF       rendered to the Lessor, hereby waives all  claims  against the
LESSOR AND        Lessor for damages to goods, wares, and merchandise, and all
LESSEE'S          other personal property in, upon, or about the Premises and
LIABILITY         for injuries to persons in or about the Premises,  from any
INSURANCE         cause arising at any time, excepting claims arising from the
                  Lessor's  negligence  or  willful  misconduct  or that of it's
                  agent, employees, or contractors, and the Lessee will hold the
                  Lessor  exempt and harmless from any damage or from the use of
                  the Premises by the lessee,  or from the failure of the Lessee
                  to keep the Premises in good  condition and repair,  as herein
                  provided. See revised insurance clause attached.
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ADVERTISE-        16. Lessee will not place or permit to be placed,  in, upon or
MENTS AND         about the  Premises  any unusual or extraordinary  signs,  or
SIGNS             any signs not approved  by the city or other  governing
                  authority.  The Lessee will not place, or permit to be placed,
                  upon the  Premises,  any  signs,  advertisements,  or  notices
                  without  the  written  consent  of the  Lessor  first  had and
                  obtained, which shall not be unreasonably withheld or delayed.
                  Any sign so placed on the Premises shall be so placed upon the
                  understanding  and agreement  that the Lessee will remove same
                  at the  termination  of the tenancy  herein created and repair
                  any damage or injury to the Premises  caused  thereby,  and if
                  not so removed by Lessee  then Lessor may have same so removed
                  at Lessee's expense.

UTILITIES         17. Lessee shall pay for all water, gas, heat,  light,  power,
                  telephone  service  and  all  other  service  supplied  to the
                  Premises.  If the premises are not served by a separate  water
                  meter,  the Lessee  shall pay to the Lessor 100 percent of the
                  water bill for the Premises.

ATTORNEY'S        18. In case suit shall be brought for the possession of the
FEES              Premises, for the recovery of any sum due hereunder,  or
                  because of the breach of any other covenant herein, the losing
                  party  shall  pay  to  the   prevailing   party  a  reasonable
                  attorney's  fee,  which shall be deemed to have accrued on the
                  commencement  of such action and shall be enforceable  whether
                  or not such action is prosecuted to judgement.

DEFAULT           19. In the event of any failure by Lessee to pay rent  within
                  5 days after  receipt of notice  from  Lessor that such sum is
                  due, or any failure by Lessee to perform any other  obligation
                  on its part to be  performed  within 15 days after  receipt of
                  written  notice  form Lessor (or if the failure is not capable
                  of  cure  within  15  days,  Lessee  shall  not be in  default
                  hereunder  if  Lessee  commences  the cure  within  the 15 day
                  period and thereafter  prosecutes the cure to completion),  or
                  an abandonment of the property by Lessee coupled with Lessee's
                  failure to pay rent hereunder, the Lessor has the option of 1)
                  removing  all  persons  and  property  from the  Premises  and
                  repossessing  the  Premises in which case any of the  Lessee's
                  property  which the Lessor  removes  from the  Premises may be
                  stored in a public  warehouse or elsewhere at the cost of, and
                  for the  account of the Lessee,  or 2) allowing  the Lessee to
                  remain in full possession and control of the Premises.  If the
                  lessor  chooses  to  repossess  the  Premises,  the lease will
                  automatically  terminate in accordance  with provisions of the
                  California  Civil Code,  Section 1951.2.  In the event of such
                  termination  of the Lease,  the Lessor  may  recover  from the
                  Lessee:  1) the worth at the time of award of the unpaid  rent
                  which  had been  earned at the time of  termination  including
                  interest at 7% per annum; 2) the worth at the time of award of
                  the  amount by which the  unpaid  rent  which  would have been
                  earned after  termination  until the time of award exceeds the
                  amount of such rental loss that the Lessee  proves  could have
                  been reasonably avoided including interest at 7% per annum; 3)
                  the  worth at the time of such  rental  loss  that the  Lessee
                  proves could be  reasonably  avoided;  and 4) any other amount
                  necessary  to  compensate  the  Lessor  for all the  detriment
                  proximately  caused by the  Lessee's  failure to  perform  his
                  obligations under the Lease or which in the ordinary course of
                  things  would be  likely to result  therefrom.  If the  Lessor
                  chooses not to repossess the  Premises,  but allows the Lessee
                  to remain in full possession and control of the Premises, then
                  in accordance  with  provisions of the California  Civil Code,
                  Section  1951.4,  the  Lessor  may treat the Lease as being in
                  full force and  effect,  and may  collect  from the Lessee all
                  rents as they become due through the  termination  date of the
                  lease  as  specified  in  the  a)  Acts  of   maintenance   or
                  preservation  or  efforts  to  relet  the  property,   b)  the
                  appointment  of a receiver on the  initiative of the Lessor to
                  protect his interest under this Lease.

LATE              20. Lessee  hereby  acknowledges  that late payment by Lessee
CHARGES           to Lessor of rent and other sums due hereunder  will cause
                  Lessor to incur  costs not  contemplated  by this  lease,  the
                  exact  amount of which will be  extremely  difficult to impose
                  the Lessor by the terms of any mortgage or trust deed covering
                  the Premises.  Accordingly,  if any installment of rent or any
                  other sum due from  Lessee  shall not be received by Lessor or
                  Lessor's designee within five (5) days after such amount shall
                  be due,  Lessee shall pay to Lessor a late charge equal to ten
                  percent (10%) of such overdue amount. The parties hereby agree
                  that  such  late  charge  represents  a  fair  and  reasonable
                  estimate  of the cost  Lessor  will  incur by  reason  of late
                  payment by Lessee.  Acceptance  of such late  charge by Lessor
                  shall in no event constitute a waiver of Lessee's default with
                  respect  to such  overdue  amount,  nor  prevent  Lessor  from
                  exercising  any of  the  other  rights  and  remedies  granted
                  hereunder.
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SURRENDER         21. The  voluntary or other surrender of this Lease by Lessee,
OF LEASE          or a mutual cancellation thereof, shall not work a merger, and
                  shall, at the option of Lessor,  terminate all of any existing
                  subleases or  subtenancies,  or may, at the opinion of Lessor,
                  operate as an assignment  to him of any of all such  subleases
                  or subtenancies.

TAXES             22. The Lessee shall be liable for all taxes levied against
                  personal property and trade or business  fixtures.  The Lessee
                  also agrees to pay, as an additional  rental,  during the term
                  of this  Lessee and any  extension  thereof,  all real  estate
                  taxes plus the yearly  installments of any special assessments
                  which are of record or which may  become of record  during the
                  term of this lease. If said taxes and assessments are assessed
                  against the entire  building and building site, and this Lease
                  does not cover the entire building or building site, the taxes
                  and assessment installments allocated to the Premises shall be
                  pro-rated on a square footage or other equitable  basis. It is
                  understood and agreed that the Lessee's  obligation under this
                  paragraph  will be pro-rated to reflect the  commencement  and
                  termination dates of this Lease.

NOTICES           23. All  notices to be given to Lessee may be given in writing
                  personally  or by  depositing  the same in the  United  States
                  mail,  postage  prepaid,  and  address  to  Lessee at the said
                  premises,  whether or not Lessee has departed from,  abandoned
                  or vacated the Premises.

ENTRY BY          24. Lessee shall permit Lessor and his agents to enter into
LESSOR            and upon the Premises at all reasonable times upon  reasonable
                  prior notice for the purpose of inspecting the same or for the
                  purpose of maintaining  the building in which the Premises are
                  situated, or for the purpose of making repairs, alterations or
                  additions to any other portion of said building, including the
                  erection and maintenance of such scaffolding, canopies, fences
                  and props as may be  required  without  any rebate of rent and
                  without any  liability to Lessee for any loss of occupation or
                  quiet enjoyment of the Premises thereby occasioned;  and shall
                  permit  Lessor and his agents,  at any time within ninety days
                  prior the expiration of this Lease, to place upon the Premises
                  any  usual or  ordinary  "For  Sale" or "To  Lease"  signs and
                  exhibit the  Premises  to  prospective  tenants at  reasonable
                  hours.  Lessor's  exercised of the  forgoing  rights shall not
                  materially increase Lessee's  obligations or diminish Lessee's
                  rights under this lease.

DESTRUCTION       25. In the event of a partial destruction of the Premises
OF PREMISES       during the said term from any cause, except earthquake, Lessor
                  shall forthwith repair the same,  provided such repairs can be
                  made within one hundred  eighty  (180) days under the laws and
                  regulations   of   State,   Federal,   County   or   Municipal
                  authorities,  but  such  partial  destruction  shall in no way
                  annul or void this Lease, except that Lessee shall be entitled
                  to a  proportionate  reduction  of rent while such repairs are
                  being made, such proportionate  reduction to be based upon the
                  extent to which the  making of such  repairs  shall  interfere
                  with the business carded on by Lessee in the Premises. If such
                  repairs  cannot be made within one hundred  eighty (180) days,
                  Lessor may,  at his  opinion,  make same  within a  reasonable
                  time,  this Lease  continuing in full force and effect and the
                  rent  to be  proportionately  reduced  as  aforesaid  in  this
                  paragraph provided. In the event that Lessor does not elect to
                  make such  repairs  which  cannot be made  within one  hundred
                  eighty (180) days,  or such repairs  cannot be made under such
                  laws and  regulations,  this  Lease may be  terminated  at the
                  option of either party. In respect to any partial  destruction
                  which  Lessor is obligated to repair may elect to repair under
                  the terms of this  paragraph,  the provisions of Section 1932,
                  Subdivision  2, and of  Section  1993,  Subdivision  4, of the
                  Civil Code of the State of California are waived by Lessee. In
                  the  event  that the  building  in which  the  Premise  may be
                  situated  by  the  extent  of no  less  than  33  1/3%  of the
                  replacement  cost thereof,  Lessor may elect to terminate this
                  Lease,  whether  the  Premises  is  injured  or not. A totally
                  destruction  of the  building  in which  the  Premises  may be
                  situated  shall  terminate  this  Lease.  In the  event of any
                  dispute  between Lessor and Lessee  relative to the previsions
                  of this paragraph,  they shall each elect and arbitrator,  the
                  two  arbitrators so selected  shall select a third  arbitrator
                  and the three arbitrators so selected shall hear and determine
                  the controversy and there decision  thereon shall be final and
                  binding  upon both Lessor and Lessee,  who shall bear the cost
                  of such arbitration equally between them. Lessee has the right
                  to terminate if the damage or  destruction  occurs  during the
                  last 12  months  of the term or if  Lessor  fails to  complete
                  repairs  or  reconstruction  within 180 days after the date of
                  damage or destruction.

ASSIGNMENT        26. The Lessee shall not assign, transfer, or hypothecate the
                  leasehold estate under the Lease, or any
<PAGE>

AND SUBLET-       interest  therein,  and shall not sublet the Premises,  or any
ING               part thereof, or any right of privilege appurtenant  thereto,
                  or  suffer  any  other  person  or entity to occupy or use the
                  Premises,  or any portion thereof,  without, in each case, the
                  prior consent of the Lessor. Lessor agrees to not unreasonably
                  withold or delay  consent to sublet or assign.  As a condition
                  for  granting  its  consent to any  subletting  the Lessor may
                  require  the  Lessee  to  agree  to  pay  to  the  Lessor,  as
                  additional rental 50% of all rents after expenses, received by
                  the Lessee from its Sublessee which are in excess of the mount
                  payable  to the  Lessee to the  Lessor  hereunder.  The Lessee
                  shall, by thirty (30) days written  notice,  advise the Lessor
                  of its intent to sublet the  Premises or any  portion  thereof
                  for any part of the term  hereof.  Within  fifteen  (15)  days
                  after  receipt of Lessee's  notice,  Lessor  shall either give
                  approval  to Lessee to sublease  the  portion of the  Premises
                  described in Lessee's  notice,  or Lessor shall terminate this
                  Lease as to the portion of the Premises  described in Lessee's
                  notice on the day specified in Lessee's  notice.  If, however,
                  Lessor  elects to  terminate  Lessee shall have the right upon
                  five (5) days  notice to Lessor to  recind  it's  request  for
                  consent,  in which case this Lease shall  remain in full force
                  and effect.  If Lessee  intends to sublet the entire  Premises
                  and Lessor elects to terminate this Lease, this Lease shall be
                  terminated on the date specified in the Lessee's  notice.  If,
                  however,  this Lease shall terminate pursuant to the foregoing
                  with  respect  to less than all the  Premises,  the  rent,  as
                  defined  and  reserved  herein  above  shall be  adjusted on a
                  prorata basis to the number of square feet retained by Lessee,
                  and this Lease as so amended shall  continue in full force and
                  effect.  If the Lessor  approves a subletting,  the Lessee may
                  sublet  immediately  after  receipt  of the  Lessor's  written
                  approval.  In the event Lessee is allowed to assign,  transfer
                  or  sublet  the  whole or any part of the  Premises,  with the
                  prior  consent  of the  Lessor,  no  assignee,  transferee  or
                  sublessee shall assign or transfer this Lease, either in whole
                  or in part,  or sublet the whole or any part of the  Premises,
                  without also having  obtained the prior written consent of the
                  Lessor.  A  consent  of Lessor  to one  assignment,  transfer,
                  hypothecation,  subletting,  occupation  of use  by any  other
                  person shall not release Lessee from any Lessee's  obligations
                  hereunder  or be  deemed  to be a  consent  to any  subsequent
                  similar of  dissimilar  assignment,  transfer,  hypothecation,
                  subletting,  occupation or use by any other  person.  Any such
                  assignment, transfer, hypothecation, subletting, occupation or
                  use without such consent shall be void and shall  constitute a
                  breach of this Lease by Lessee and  shall,  at the  opinion of
                  Lessor  exercised by written notice to Lessee,  terminate this
                  Lease.  The  leasehold  estate under this Lease shall not, nor
                  shall any interest  therein,  be  assignable of any purpose by
                  operation of law without the written  consent of Lessor.  As a
                  condition to its consent, Lessor may require Lessee to pay all
                  expense in connection  with the  assignment not to exceed five
                  thousand dollars ($50,00) per request,  and Lessor may require
                  Lessee's   assignee  or  transferee  (or  other  assignees  of
                  transferees)to  assume in writing all of the obligations under
                  this Lease.

CONDEM- 27.       If any part of the Premises  shall be taken for any public or
NATION            quasi-public use,  under any  statute or by right of eminent
                  domain or private purchase in lieu thereof, and a part thereof
                  remains which is  susceptible  of occupation  hereunder,  this
                  Lease shall, as to the part so taken, terminate as of the date
                  title shall vest in the condemnor or  purchaser,  and the rent
                  payable  hereunder  shall be adjusted so that the Lessee shall
                  be  required  to pay for the  remainder  of the term only such
                  portion of such rent as the value of the part remaining  after
                  such taking bears to the value of the entire Premises prior to
                  such taking; but in such event Lessor shall have the potion to
                  terminate  this  Lease as of the day when title to the part so
                  taken  vests  in the  condemnor  or  purchaser.  If all of the
                  Premises,  or such part thereof to be taken so that there does
                  not remain a portion  susceptible  for  occupation  hereunder,
                  this Lease shall be thereupon terminated. If a part or all the
                  Premises be taken, all  compensation  awarded upon such taking
                  shall go to the Lessor and the Lessee shall be entitled to any
                  separate  award made by the  condemning  authority  for moving
                  costs,   relocation   expenses,   loss  of  good   will,   and
                  improvements paid for by Lessee.

EFFECT OF         28. The term "Lessor" as used in this Lease, means only the
CONVEYANCE        owner for the time being of the land and building  containing
                  the  Premises,  so that, in the event of any sale of said land
                  or building,  or in the event of lease of said  building,  the
                  Lessor  shall be and hereby is entirely  free and  relieved of
                  all covenants and obligations of the Lessor hereunder,  and it
                  shall be  deemed  and  construed,  without  further  agreement
                  between the parties and the purchaser at any such sale, or the
                  Lessee of the  building,  that the  purchaser or Lessee of the
                  building  has  assumed  and  agreed  to carry  out any and all
                  covenants  and  obligations  of the Lessor  hereunder.  If any
                  security  be  given  by the  Lessee  to  secure  the  faithful
                  performance  of all or any of the  covenants  of this Lease on
                  the part of the Lessee,  the Lessor shall transfer and deliver
                  the
<PAGE>

                  security,  as such,  to the  purchaser at any such sale or the
                  lessee of the  building,  and  thereupon  the Lessor  shall be
                  discharged from any further liability in reference thereto.

SUBORDI-          29.  Lessee  agrees that this Lease may, at the opinion of
NATION            Lessor,  be subject and  subordinate  to any mortgage,
                  deed of trust or other  instrument of security  which has been
                  or shall be  placed  on the land  and  building  of which  the
                  Premises form a part,  and this  subordination  is hereby made
                  effective without any further act of Lessee. The Lessee shall,
                  at any time hereinafter,  on demand,  execute any instruments,
                  releases,  or  other  documents  that  may  be  required  by a
                  mortgagee, mortgagor, or trustor or beneficiary under any deed
                  of trust for the purpose of subjecting and subordinating  this
                  Lease to the lien of any such  mortgage,  deed of trust or any
                  other instrument of security, and the failure of the Lessee to
                  execute any such  instruments,  releases or  documents,  shall
                  constitute  default hereunder.  Any subordination  pursuant to
                  this section  shall not be effective  unless the holder of any
                  such  instrument  executes  a  nondisturbance  and  attornment
                  agreement   allowing  the  Lessee  to  continue  enjoying  the
                  tennancy without interruption or obstruction.  Notwithstanding
                  anything to the contrary  contained in this Lease, by no later
                  than the  commencement  date hereof,  Lessor shall obtain from
                  any  existing  lenders  or ground  lessors  of the  Premises a
                  written agreement in form reasonably  satisfactory to Lessee's
                  providing for  recognition of Lessee's  interest or under this
                  Lease in the event of a foreclosure  of the lender's  security
                  interest or  termination  of the ground lease.  Further,  as a
                  condition to Lessee's  obligation to subordinate its leasehold
                  interest to a any future ground lease or instrument  security,
                  Lessor shall obtain from any such ground  landlords or lenders
                  a   written   recognition   agreement   in   form   reasonably
                  satisfactory  to  Lessee  providing  that  Lessee's  rights of
                  occupancy   shall  no  be  disturbed  in  the  event  of  such
                  termination  or  foreclosure,  Lessee shall receive all of the
                  services, provided for under this Lease.

WAIVER            30. The waiver by Lessor of any branch of any term,  covenant
                  or condition,  herein contained shall be deemed to be a waiver
                  of such a term, covenant or condition of any subsequent breech
                  of the same or any other term,  covenant of condition  therein
                  contained.  The  subsequent  acceptance  of rent  hereunder by
                  Lessor  shall not be  deemed  to be a waiver of any  preceding
                  breach by Lessee by any term,  covenant or  condition  of this
                  Lease,  other than the failure of Lessee to pay the particular
                  rent so  accepted,  regardless  of Lessor's  knowledge of such
                  preceding breach at the time of acceptance of such rent.

HOLDING           31. Any holding  over after the  expiration  of the said term,
OVER              with the consent of Lessor, shall be construed to be a tenancy
                  from month to month,  at a rental to be  negotiated  by Lessor
                  and Lessee  prior to the  expiration  of said term,  and shall
                  otherwise be on the terms and conditions herein specified,  so
                  far applicable.

SUCCESSORS        32. The covenants and conditions  herein contained shall,
AND ASSIGNS       subject to the  provisions  as to  assignment,  apply to and
                  bind the  heirs,  successors,  executors,  administrators  and
                  assigns  for all of all  the  parties  hereto;  and all of the
                  parties   hereto  shall  be  jointly  and   severally   liable
                  hereunder.

TIME              33. Time is of the essence of this Lease.

MARGINAL          34. The marginal headings or title to the paragraphs of this
CAPTIONS          Lease are not a part of this Lease and shall have no effect
                  upon the construction and  interpretation of any part thereof.
                  This instrument  contains all of the agreements and conditions
                  made between the parties hereto and may not be modified orally
                  or in any other manner than by an agreement in writing  signed
                  by all of the parties hereto in there respective successors in
                  interest.

         Paragraphs  35, 36, and Memorandum of  Understanding  are hereby made a
part of this Lease.

THIS LEASE HAS BEEN  PREPARED FOR  SUBMISSION  TO YOUR  ATTORNEY WHO WILL REVIEW
THE DOCUMENT AND ASSIST YOU TO DETERMINE  WHETHER YOUR LEGAL RIGHTS ARE
ADEQUATELY
<PAGE>

PROTECTED  RENAULT & HANDLEY IS NOT AUTHORIZED TO GIVE LEGAL AND TAX ADVICE.  NO
REPRESENTATION  OR  RECOMMENDATION IS MADE BY RENAULT & HANDLEY OR ITS AGENTS OR
EMPLOYEES AS TO THE LEGAL SUFFICIENCY,  LEGAL EFFECT OR TAX CONSEQUENCES OF THIS
DOCUMENT OR ANY  TRANSACTION  RELATING  THERETO.  THESE ARE  QUESTIONS  FOR YOUR
ATTORNEY WITH EHOM YOU SHOULD CONSULT BEFORE SIGNING THIS DOCUMENT.

     IN WITNESS WHEREOF, Lessor and Lessee have executed there presents, the day
and year first written above.

              LESSOR                                             LESSEE
     Kifer Investment Co.                                 Cobalt Networks, Inc.

     By                                              By              /s/ xxx
             -------------------------------                 ------------------

     Printed                                         Printed        Gary Martell
             -------------------------------                 ------------------

     Date                                            Date           10/25/99
             -------------------------------                 ------------------
<PAGE>

                              ADDITIONAL PARAGRAPH

         The additional  paragraphs are hereby made a part of that certain Lease
dated September 28, 1999 by and between Kifer  Investment Co., Lessor and Cobalt
Networks, Inc., Lessee covering the Premises at 515 Ellis Street, Mountain View,
California.

   35.  Lessor  grants to Lessee the option of  renewing  this Lease for one (1)
additional  2 year term  commencing  on the  termination  day of the Lease.  The
option  period  shall  be  governed  by all the same  terms  and  conditions  as
contained in the original Lease excepting the monthly rental which shall be then
fair market for comparable office/R&D buildings in the  Ellis/Middlefield  area.
Lessor and Lessee shall  reasonably  negotiate fair market value for a period of
thirty  (30) days.  If at the end of the  thirty;  (30) day  period,  Lessor and
Lessee have not agreed  upon Fair Market  rental  value,  Lessee  shall have the
right to rescind it's exercised options. In no event however,  shall the monthly
rental for the option period be less than $79,081.30.  In order to exercise this
option,  Lessee  must give  Lessor six (6) months  written  notice  prior to the
termination of the original term.

   36. Lessor will hold Lessee  harmless from and against all costs of response,
corrective  action,  remedial action,  claims,  demands,  losses and liabilities
arising  from  any  pre-existing  environmental  contamination  which  may  have
occurred prior to the Lessee taking possession of the Premises.

Lessee will only be responsible for  contamination  of the Premises of the soils
or ground water thereon or thereunder in violation of Hazardous  Materials  Law,
that is caused by Lessee or Lessee's agents,  contractors or invitees during the
term as may be extended.  All  hazardous  materials and toxic wastes that Lessee
brings on the Premises shall be stored according to Hazardous Materials' Law.

All hazardous materials and toxic wastes that Lessee brings on the site shall be
stored  according  to  all  local,  sate  and  national  regulations.  Hazardous
materials  shall be defined as those  substances that are recognized as posing a
risk of injury to health or safety by the Santa Clare Fire Department, the Santa
Clara Health Department,  the Regional Water Quality Control Board, the State of
California or Federal Government.

For the purpose of this Lease,  "Hazardous Materials Law" shall meant all local,
state, and federal laws, shames,  ordinances,  rules,  regulations,  judgements,
injunctions,  stipulations,  decrees,  orders,  permits,  approval,  treaties or
protocols now of hereafter  enacted,  issued of  promulgated  by any  government
authority  which  relate  to  any  Hazardous  Materials  of the  use,  handling,
transportation,  production,  disposal,  discharge,  release,  emission, sale or
storage of, or the exposure of any person to, a Hazardous Material.
<PAGE>

                           MEMORANDUM OF UNDERSTANDING

Parties:          Cobalt Networks, Incorporated    Kifer Investment Co.

Date:             September 28, 1999

RE:               That certain Lease dated  September  28, 1999 by and between
                  Renault & Handley,  Kifer  Investment  Co.,  Lessor and
                  Cobalt Networks,  Inc., Lessee for and approximate 29,842
                  square foot industrial  building commonly know as 515 Ellis
                  Street, Mountain View, California.

It is agreed as follows:

Lessor to deliver the building in good Working condition, as follows:

         A) Electrical Wiring to be Compliant

         B) Building  Seams at Column lines C9 and B9 to be Sealed.  C) Exterior
            building lighting to be working properly.

         D) Lessor understands that the Existing Category Five (CAT 5) wiring,
            voice/data  lines are part of the  structure  and will remain with
            the building  during Cobalt's  occupancy.  Lessor to make its best
            effort  to have  Connect,  Inc.  tag end to end the CAT 5  wiring,
            voice/data  lines and leave them in operable  condition.  Further,
            Lessee  shall have the right to sever and access the two (2) eight
            inch  cable  conduits  that run  along  the back  roof line of the
            property.

Lessor  understands and has approved Lessee's tenant improvement plans to demise
the premises and Sublease a portion of the building,  per the attached  "Exhibit
A".

Lessor  agrees  that  Lessee  shall  have  full and  unrestricted  access to the
Property  for 31 days prior to lease  commencement  for the purpose of equipment
installation  and  fixturing  the Property for Lessee's  use.  Said early access
shall be  extended  rent  free to  Lessee,  but in all other  respects  shall be
governed  by the terms of this lease  including  the  payment of  utilities  and
insurance costs.

Lessor as part of the consideration for the execution of this Lease,  power-wash
the exterior or the  Premises,  clean up the landscape  area and repair  damaged
asphalt in the parking lot. Lessee is entitled to all parking designated for the
Property.

Notwithstanding anything to the contrary contained in par 10 of the above Lease,
Lessor  shall be  responsible  for  landscaping  and  parking  lot  maintenance,
including  resealing and restriping the parking areas when needed.  Lessor shall
also be responsible  for the  maintenance  of the roofing  fabric  including the
clearing of drains,  resealing of  penetrations  when  necessary and all service
calls due to water leaks. Lessor shall also pay for a service which will provide
monthly HVAC inspections and maintenance.  Lessee shall be responsible,  for all
HVAC repair as specific in par 10 of the Lease.  Lessee  agrees to pay to Lessor
for this common area maintenance (CAM) the sum of 930.00/mo.  Which sum shall be
payable with the monthly rental amount.

READ & AGREED:

Kifer Investment Co.                                  Cobalt Networks, Inc.
By                                                    By       /s/ xxx
     -------------------------------                       --------------

Date -------------------------------                  Date    10/28/99
                                                            --------------
<PAGE>

                            REVISED INSURANCE CLAUSE

This Lease Clause replaces the Insurance Clause (11.) in the Renault & Handley
Net Lease Form

11. Lessee shall not use, or permit on the Premises,  or any part thereof, to be
used,  for any purpose other than that for which the Premises are hereby Leased;
and no use shall be made or  permitted to be made on the Premises nor acts done,
which  will cause a  cancellation  of any  insurance  policy  coveting  the said
building,  or any part thereof,  or shall Lessee sell or permit to keep, used or
sold,  in or about the  Premises,  any article  which may be  prohibited  by the
standard form of fire insurance  policies.  Lessee shall,  at his whole cost and
expense,  comply with any and all requirements,  pertaining to the Premises,  of
any  insurance  organization  of  company,  necessary  for  the  maintenance  of
reasonable  fire and public  liability  insurance,  coveting  said  building and
appurtenances.

11.1 Lessee shall,  at its expense,  obtain and keep in force during the term of
this Lease a policy of comprehensive public liability insurance insuring Lessee,
Lessor,  and any third  parties  named by Lessor which may include only Lessor's
lender and property  manager,  if any, against any liability  arising out of the
condition,  use, occupancy or maintenance of the Premises.  Such insurance shall
have a combined  single limit for both bodily  injury and property  damage in an
amount no less than One  Million  and  No/100ths  Dollars  ($1,000,000.00).  The
limits of said insurance shall not limit the liability of Lessee hereunder.

11.2 Lessee shall, at its expense,  keep in force during the term of this Lease,
a policy of fire and property damage insurance in an "all risk" with a sprinkler
leakage  endorsement,  insuring  Lessee's  inventory,  fixtures,  equipment  and
personal property within the Premises for the full replacement value thereof.

11.3  Lessor  shall  maintain a policy or  policies  of fire a  property  damage
insurance in an "all risk" form,  with  sprinkler  and, at the option of Lessor,
earthquake  endorsements,  coveting  loss or damage of the  building,  including
Lessee's leasehold improvements installed with the written consent of the Lessor
at 100% full  replacement  value with such  additional  coverage as Lessor deems
advisable.

11.4 Lessee shall pay to Lessor as an additional rent,  during the term thereof,
within  twenty (20) days after receipt of an invoice  therefore,  100 percent of
the premiums for any insurance obtained by Lessor pursuant to 11.3 above. Lessor
may obtain such  insurance for the Building  separately,  or together with other
buildings and improvements  which Lessor elects to insure together under blanket
policies of insurance. In such case Lessee shall be liable for only such portion
of the premium for such blanket policies as are allocable to the Premises. It is
understood and agreed that Lessee's  obligation  under this  paragraph  shall be
prorated to reflect the Commencement Date and Expiration Date of the Lease.

11.5 Lessee and Lessor hereby waiver any and all rights of recovery  against the
other,  or against the  officers,  directors,  employees,  partners;  agents and
representative  of the other,  for loss or damage to the property of the waiving
party or the property of others  under its  control,  to the extent such loss or
damage is insured against any under insurance policy carried by Lessor or Lessee
hereunder.  Each party shall notify their respective  insurance carriers of this
waiver.
<PAGE>

                                      (Map)

                                  COBALT SCHEME
<PAGE>

Thank you for choosing to do business with us. This Agreement has the purpose of
licensing  the right to (i)  incorporate  the RSA Software into your product and
(ii) use and/or  distribute to and users the RSA Software solely as incorporated
into such products.  In return,  You agree to pay RSA the license fees described
in this  agreement  for its  attachments)  which are  typically  comprised of an
initial  payment of license  fees,  plus  on-going per unit license  fees,  but,
alternatively, may consist of annual license fee amounts or other arrangement as
described in this Agreement.  This license is for object code only.  Maintenance
and support for the RSA Software licensed,  if elected,  is under separate terms
and  conditions.  This License  Agreement is to be construed and  interpreted in
accordance with this general  purpose,  though any conflict between this general
purpose and the express terms found in this License  Agreement shall be resolved
in favor of the express terms.

Enterprise Name ("You"): Cobalt Networks, Inc.  Jurisdiction of Incorporation:DE
                         ---------------------                                --
Street Address: 555 Ellis Street
                ----------------------------------------------------------------
City: Mountain View                                   State & Zip Code: CA 94043
      --------------------------------------------------------------------------
Enterprise Legal Contact (Name & Title) : Richard Finlayson, Director of
                                          --------------------------------------
Business Development
--------------------------------------------------------------------------------

Agreement Number: 0999-COB-0-OEM-1
                 ---------------------------------------------------------------

This  LICENSE  AGREEMENT  (the  "Agreement"),  effective as of the later date of
execution  ("Effective Date"), is entered into by and between RSA Data Security,
Inc. a Delaware corporation  ("RSA"),  having a principal address et 2955 Campus
Drive, Suite 400, San Mateo, CA 94403-2507, and the Enterprise identified above

                                  1 DEFINITIONS

The  following  terms  when  used in this  Agreement  shall  have the  following
meanings:

1.1 "LICENSED  PRODUCT(S) " means one or more of Your products or product groups
identified in the attached  "Product and License Fee Exhibit"  which has been or
will be developed by You and which incorporates in any manner any portion of the
RSA Software. a Licensed Product (i) must represent a significant functional and
value  enhancement  to the RSA Software such that the primary  reason to license
such  Licensed  Product  is other  than the right to  receive  a license  to the
functionality of the RSA Software included in the Licensed  Product,  (ii) shall
not expose or,  directly or  indirectly,  pass through any APIs, and (iii) shall
not be a security add-on or "bolt-on," the primary purpose of which is providing
security to a third party's product.

1.2 "DISTRIBUTOR"  means a dealer or distributor in the business of reselling or
relicensing Licensed Products to End User Customers,  directly or through one or
more  Distributors,  by virtue of authority  granted by You.  Licensed  Products
resold by a Distributor  shall bear Your  trademarks and service marks and shall
not be privately  labeled by such  Distributor or other  parties.  a Distributor
shall have no right to add to or modify any part of the Licensed Product.

1.3 "END USER  CUSTOMER"  means a person  or an  entity  (a third  party or Your
employees solely for their internal business purposes) receiving RSA Software as
part or a Licensed  Product  from You or a  Distributor  for their  personal  or
internal use and primarily not for resale,  redistribution  or other transfer of
such Licensed Product to any other person or entity,

1.4 "RSA SOFTWARE" means RSA's proprietary  software  identified on the attached
"Product and License Fee Exhibit" (and  including only these  algorithms  listed
therewith), as further described in the User Manual(s) associated therewith.

1.5 "TERRITORY" means worldwide, subject to Section 11.6.

1.6  "UPDATES"  means  any new  version  of the  RSA  Software  designated  by a
progressing  of the release  number  (either right or left of the decimal point)
following the version initially shipped hereunder.

1.7 "USER  MANUAL"  means the most  current  version of the user  manual  and/or
reference  manual  customarily  supplied by RSA to entities  who license the RSA
Software.

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