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                                                                   EXHIBIT 4.07



                         SERVICESOFT TECHNOLOGIES, INC.

                                 AMENDMENT NO. 1

                                       TO

                        1999 STOCK OPTION AND GRANT PLAN

                                FEBRUARY 10, 2000

                              W I T N E S S E T H:


WHEREAS, the Board of Directors and the Stockholders of Servicesoft
Technologies, Inc. (the "Company") approved and adopted the 1999 Stock Option
and Grant Plan (the "Plan") of the Company, dated November 1, 1999;

WHEREAS, the Board of Directors and the Stockholders of the Company have
determined that it is in the best interest of the Company to amend the Plan in
order to provide for the issuance of Awards under the Plan to officers and other
employees, Independent Directors, consultants, and key persons of the Company
and its Subsidiaries who are legal residents of the State of California and to
clarify certain provisions of the Plan;

NOW, THEREFORE, the Plan is amended as follows:

1.         Amendment to Section 1. Section 1 of the Plan shall be amended to
           include the following definition:

           "Cause" means a vote of the Board of Directors of the Company or the
           successor entity, as the case may be, resolving that the grantee
           should be dismissed as a result of (i) any material breach by the
           grantee of any agreement to which the grantee and the Company are
           parties, (ii) any act (other than retirement) or omission to act by
           the grantee which would reasonably be likely to have a material
           adverse effect on the business of the Company or its Subsidiaries or
           successor entity, as the case may be, or on the grantee's ability to
           perform services for the Company or its Subsidiaries or successor
           entity, as the case may be, including, without limitation, the
           conviction of any crime (other than ordinary traffic violations), or
           (iii) any material misconduct or willful and deliberate
           non-performance of duties by the grantee in connection with the
           business or affairs of the Company or its Subsidiaries or successor
           entity, as the case may be.

2. Amendment to Section 3(b). Clauses (i) and (ii) of Section 3(b) of the Plan
entitled "Recapitalization" shall be amended to add the underscored language and
delete the stricken language, as set forth below:

           "(i) the maximum number of shares initially reserved for issuance
           under the Plan and the maximum number that may subsequently be
           reserved for issuance under the Plan, (ii) the number of Stock
           Options that can be granted to any one individual participant,"

3. Amendment to Add Appendix A. An appendix A to the Plan in substantially the
form attached hereto as Exhibit A is hereby adopted and approved.

4. Capitalized Terms. Capitalized terms used herein not otherwise defined herein
shall have the meanings set forth in the Plan.

DATE APPROVED BY THE BOARD OF DIRECTORS: February 10, 2000


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                                                                      EXHIBIT A


                                   APPENDIX A

                                       to

                         SERVICESOFT TECHNOLOGIES, INC.
                        1999 STOCK OPTION AND GRANT PLAN

                          FOR CALIFORNIA RESIDENTS ONLY

This Appendix to the Servicesoft Technologies, Inc. 1999 Stock Option and Grant
Plan (the "Plan") shall have application only to optionees receiving Incentive
Stock Options or Non-Qualified Stock Options under the Plan who are residents of
the State of California. Capitalized terms contained herein shall have the same
meanings given to them in the Plan, unless otherwise provided in this Appendix.
Notwithstanding any provisions contained in the Plan to the contrary and to the
extent required by applicable law, the following terms and conditions shall
apply to all Awards granted to residents of the State of California, until such
time as the Common Stock becomes a "listed security" under the Securities Act of
1933, as amended.

        1. Non-Qualified Stock Options shall have an exercise price that is not
less than 85% of the Fair Market Value of the stock at the time the Option is
granted, as determined by the Board, except that the exercise price shall be
110% of the Fair Market Value in the case of any person who owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or its parent or subsidiary corporation.

        2. The purchase price for any Restricted Stock Awards that may be
purchased under the Plan shall be at least 85% of the Fair Market Value of the
stock at the time the optionee is granted such Award, or at the time the
purchase is consummated. Notwithstanding the foregoing, the purchase price shall
be 100% of the Fair Market Value of the stock at the time the optionee is
granted such Award or at the time the purchase is consummated in the case of any
person who owns stock possessing more than 10% of the total combined voting
power of all classes of the Company or its parent or subsidiary corporations.

        3. Options shall have an exercise period of not more than ten years from
the date the Option is granted.

        4. No Award shall be transferable by a participant other than by will or
the laws of descent and distribution; provided, however, that the Committee, in
its sole discretion, may permit a participant to transfer an Option (a) by gift
to members of his immediate family, or (b) to an inter vivos or testamentary
trust pursuant to which the Option is to be passed to beneficiaries upon the
death of the settlor.

        5. Options shall become exercisable at the rate of at least 20% per year
over five years from the date the Option is granted, subject to reasonable
conditions such as continued employment. However, in the case of the Option
granted to officers, directors or consultants of the Company or any of its
affiliates, the Option may become fully exercisable, subject to reasonable
conditions such as continued employment, at any time or during any period
established by the Company or any of its affiliates.

        6. Unless employment is terminated for Cause, the right to exercise an
Option in the event of termination of employment, to the extent that the
participant is otherwise entitled to exercise an Option on the date employment
terminates, shall be:

           a. at least six months from the date of termination if the
participant's employment was terminated as a result of death or disability; and

           b. at least 30 days from the date of termination if the participant's
employment was terminated other than on account of death or disability;


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           c. but in no event later than the remaining term of the Option.

        7. No Award may be granted to a resident of California more than ten
years after the earlier of the date of adoption of the Plan and the date the
Plan is approved by the shareholders.

        8. Any Award exercised before shareholder approval is obtained shall be
rescinded if shareholder approval is not obtained within 12 months before or
after the Plan is adopted. Such shares shall not be counted in determining
whether such approval is obtained.

        9. The Company shall provide annual financial statements of the Company
to each California resident holding an outstanding Award under the Plan. Such
financial statements need not be audited and need not be issued to key employees
whose duties at the Company assure them access to equivalent information.

        10. Any right of repurchase on behalf of the Company in the event of an
optionee's termination of employment or other business relationship shall be at
such purchase price as is set forth in the instrument, provided that the right
to repurchase at the original purchase price lapses at the rate of at least 20%
of the shares per year over five years from the date the Award is granted
(without respect to the date the Award was exercised or became exercisable) and
the right to repurchase shall be exercised for cash or cancellation of
indebtedness for the shares within 90 days of termination of employment (or in
case of securities issued upon exercise of Options after the date of
termination, within 90 days after the date of the exercise). The foregoing
notwithstanding, the securities held by an officer, director or consultant of
the Company or an affiliate of the Company may be subject to additional or
greater restrictions.