Document:

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                                                               WARRANT #98A-1-4

THE SECURITIES REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"), OR UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE ACT OR AN OPINION
OF COUNSEL SATISFACTORY TO THE CORPORATION THAT AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER SET FORTH HEREIN AND IN THAT CERTAIN S1998 SERIES A-1
NOTE AND WARRANT PURCHASE AGREEMENT BETWEEN THE CORPORATION AND THE ORIGINAL
HOLDER HEREOF.

                             1998 SERIES A-1 WARRANT

         FOR PAYMENT OF SEVEN HUNDRED TWENTY UNITED STATES DOLLARS ($720.00),
PHASECOM, INC., a Delaware corporation (the "Corporation"), hereby grants to Eli
David ("Holder"), the right to purchase from the Corporation up to two thousand
four hundred (2,400) shares of the Common Stock of the Corporation (the "Warrant
Shares"), subject to the following terms and conditions:

         1. SERIES. This Warrant is one of a duly authorized series of warrants
of the Corporation (which are identical except for the variations necessary to
express the identification numbers, names of the holder, warrant purchase price,
number of common shares issuable upon exercise thereof and warrant issue dates)
designated as its "1998 Series A-1 Warrants."

         2. TERM. This Warrant may be exercised in whole at any time during the
period from the date of issuance of this Warrant through March 31, 2002 (the
"Exercise Period").

         3. PURCHASE PRICE. The purchase price for each Warrant Share
purchasable hereunder shall be Five and 70/100 United States Dollars (U.S.
$5.70) (the "Warrant Exercise Price").

         4. EXERCISE OF WARRANT. The purchase rights represented by this Warrant
may be exercised by the Holder, in whole or in part, at any time and from time
to time before the end of the Exercise Period by surrender of this Warrant at
the principal office of the Corporation in Cupertino, California (or such other
office or agency of the Corporation as may be designated by notice in writing to
the Holder at the address of the Holder appearing on the books of the
Corporation), together with the Notice of Exercise annexed hereto duly completed
and executed on behalf of the Holder accompanied by payment in full of the
amount of the aggregate Warrant Exercise Price in immediately available funds in
United States Dollars. Certificates for shares purchased hereunder shall be
delivered to the Holder within thirty (30) business days after the date on which
this Warrant shall have been exercised as aforesaid, but Holder shall be deemed
the record owner of such Warrant Shares as of and from the close of business on
the date on which this Warrant shall be surrendered.

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         5. FRACTIONAL INTEREST. The Corporation shall not be required to issue
any fractional shares on the exercise of this Warrant.

         6. WARRANT CONFERS NO RIGHTS OF SHAREHOLDER. Holder shall not have any
rights as a shareholder of the Corporation with regard to the Warrant Shares
prior to actual exercise resulting in the purchase of the Warrant Shares.

         7. INVESTMENT REPRESENTATION. Neither this Warrant nor the Warrant
Shares issuable upon the exercise of this Warrant have been registered under the
Securities Act of 1933, as amended (the "Securities Act"), or under any
applicable state securities laws. Holder acknowledges by acceptance of this
Warrant that (a) it has acquired this Warrant for investment and not with a view
toward distribution; (b) it has a pre-existing personal or business
relationship with the Corporation, or its executive officers, or by reason of
its business or financial experience it has the capacity to protect its own
interests in connection with the transaction; and (c) it is an accredited
investor as that term is defined in Regulation D promulgated under the
Securities Act or is note a U.S. Person as that term is defined in Regulation S
promulgated under the Securities Act. Holder agrees that any Warrant Shares
issuable upon exercise of this Warrant will be acquired for investment and not
with a view toward distribution; and acknowledges that to the extent such
Warrant Shares will not be registered under the Securities Act and applicable
state securities laws, that such Warrant Shares may have to be held indefinitely
unless they are subsequently registered or qualified under the Securities Act
and applicable state securities laws; or, based on an opinion of counsel
reasonably satisfactory to the Corporation, an exemption from such registration
and qualification is available. Holder, by acceptance hereof, consents to the
placement of the following restrictive legends, or similar legends, on each
certificate to be issued to Holder by the Corporation in connection with the
issuance of such Warrant Shares:

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER ANY
         STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, TRANSFERRED,
         PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
         STATEMENT FOR SUCH SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL
         SATISFACTORY TO THE CORPORATION THAT AN EXEMPTION FROM SUCH
         REGISTRATION IS AVAILABLE.

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
         RESTRICTIONS ON TRANSFER SET FORTH IN THAT CERTAIN 1998 SERIES A-1 NOTE
         AND WARRANT PURCHASE AGREEMENT BETWEEN THE CORPORATION AND THE ORIGINAL
         HOLDER HEREOF.

         8. RESERVATION OF SHARES. The Corporation agrees at all times during
the Exercise Period to have authorized and reserved, for the exclusive purpose
of issuance and delivery upon exercise of this Warrant, a sufficient number of
shares of its Common Stock to provide for the exercise of the rights represented
hereby.

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         9. ADJUSTMENT FOR RE-CLASSIFICATION OF CAPITAL STOCK. If the
Corporation at any time during the Exercise Period shall, by subdivision,
combination or re-classification of securities, change any of the securities to
which purchase rights under this Warrant exist under the same or different
number of securities of any class or classes, this Warrant shall thereafter
entitle the Holder to acquire such number and kind of securities as would have
been issuable as a result of such change with respect to the Warrant Shares
immediately prior to such subdivision, combination or re-classification. If
shares of the Corporation's common stock are subdivided into a greater number of
shares of common stock, the purchase price for the Warrant Shares upon exercise
of this Warrant shall be proportionately reduced and the Warrant Shares shall
be proportionately increased; and conversely, if shares of the Corporation's
common stock are combined into a smaller number of common stock shares, the
price shall be proportionately increased, and the Warrant Shares shall be
proportionately decreased.

         10. PUBLIC OFFERING LOCK-UP. In connection with any public
registration of this Corporation's securities, the Holder (and any transferee
of Holder) agrees, upon the request of the Corporation or the underwriter(s)
managing such underwritten offering of the Corporation's securities, not to
sell, make any short sale of, loan, grant any option for the purchase of, or
otherwise dispose of this Warrant, any of the shares of Common Stock issuable
upon exercise of this Warrant or any other securities of the Corporation
heretofore or hereafter acquired by Holder (other than those included in the
registration) without the prior written consent of the Corporation and such
underwriter(s), as the case may be, for a period of time not to exceed one
hundred eighty (180) days from the effective date of the registration. Upon
request by the Corporation, Holder (and any transferee of Holder) agrees to
enter into any further agreement in writing in a form reasonably satisfactory
to the Corporation and such underwriter(s). The Corporation may impose
stop-transfer instructions with respect to the securities subject to the
foregoing restrictions until the end of said 180-day period. Any shares
issued upon exercise of this Warrant shall bear an appropriate legend
referencing this lock-up provision.

         11. ASSIGNMENT. With respect to any offer, sale or other disposition of
this Warrant or any underlying securities, the Holder will give written notice
to the Corporation prior thereto, describing briefly the manner thereof,
together with a written opinion of such Holder's counsel, to the effect that
such offer, sale or other distribution may be effected without registration or
qualification (under any applicable federal or state law then in effect).
Furthermore, no such transfer shall be made unless the transferee meets the same
investor suitability standards set forth in Section 7 of this Warrant. Promptly
upon receiving such written notice and reasonably satisfactory opinion, if so
requested, the Corporation, as promptly as practicable, shall notify such Holder
that such Holder may sell or otherwise dispose of this Warrant or the underlying
securities, as the case may be, all in accordance with the terms of the written
notice delivered to the Corporation. If a determination has been made pursuant
to this Section 11 that the opinion of counsel for the Holder is not reasonably
satisfactory to the Corporation, the Corporation shall so notify the Holder
promptly after such determination has been made. Each Warrant thus transferred
shall bear the same legends appearing on this Warrant, and underlying securities
thus transferred shall bear the legends required by Section 7. The Corporation
may impose

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stop-transfer instructions in connection with such restrictions.  Subject to
any restrictions on transfer described elsewhere herein, the rights and
obligations of the Corporation and the Holder of this Warrant shall be
binding upon and benefit the successors, assigns, heirs, administrators and
transferees of the parties hereto.

         12. NOTICE. Any notice, demand, consent or other communication
hereunder shall be in writing addressed to the other party at its principal
office or, in respect of Holder, as its address as shown on the books of the
Corporation, or to such other address as such party shall have theretofore
furnished by like notice, and either served personally, sent by express,
registered or certified first class mail, postage prepaid, sent by facsimile
transmission, or delivered by reputable commercial courier. Such notice shall be
deemed given (i) when so personally delivered, or (ii) if mailed as aforesaid,
seven (7) days after the same shall have been posted, or (iii) if sent by
facsimile transmission, as soon as sender receives written or telephonic
confirmation that the message has been received and such facsimile is followed
the same day by mailing by prepaid express, registered or certified mail as set
forth herein, or (iv) if delivered by commercial courier, upon receipt.

         13. GOVERNING LAW. This Warrant shall be governed by and construed in
accordance with the laws of the State of California, applicable to contracts
between California residents entered into and to be performed entirely within
the State of California.

         14. ATTORNEYS' FEES. If any action at law or in equity is necessary to
enforce or interpret the terms of this Warrant, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and disbursements in addition to
any other relief to which such party may be entitled.

         15. DESCRIPTIVE HEADINGS. The headings used herein are descriptive only
and for the convenience of identifying provisions, and are not determinative of
the meaning or effect of any such provisions.

Dated:  February 3, 1998                 PHASECOM, INC.

                                         By:  /s/ Shaul Berger
                                              ----------------------------
                                              Shaul Berger, President

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                               NOTICE OF EXERCISE
                             1998 SERIES A-1 WARRANT

TO:      PHASECOM, INC.

         (1) The undersigned hereby elects to purchase ______ shares of Common
Stock of PhaseCom, Inc., pursuant to the terms of the attached 1998 Series A-1
Warrant, and tenders herewith payment in full of the purchase price for such
shares.

         (2) In exercising this Warrant, the undersigned hereby confirms and
acknowledges that the shares of Common Stock are being acquired solely for the
account of the undersigned and not as a nominee for any other party, for
investment, and that the undersigned will not offer, sell or otherwise dispose
of any such shares of Common Stock except under circumstances that will not
result in a violation of the Securities Act of 1933, as amended, or any state
securities laws.

         (3)      Please issue a certificate representing said shares of
Common Stock in the name of the undersigned.

         (4)      Please issue a new Warrant for the unexercised portion
of the attached Warrant in the name of the undersigned.

Date: _________________, 199__      ___________________________________
                                       (Name)

                                   ____________________________________
                                       (Signature)

                                   ____________________________________

                                   ____________________________________

                                       (Print Address)<PAGE>

                             MASTER ESCROW AGREEMENT

                           MasterNumber 1502013-00001

         This Agreement is effective NOVEMBER 11, 1998 among Data Securities
International, Inc. ("DSI") and ObjectSpace, Inc., a Delaware corporation with
offices at 14850 Quorum Drive, Suite 500, Dallas, Texas 75240 ("ObjectSpace"),
and any additional parties signing the Acceptance Form attached to this
Agreement ("Preferred Beneficiary") who collectively may be referred to in this
Agreement as "the parties."

A.       ObjectSpace has entered or will enter into a license agreement,
         development agreement, and/or other agreement with a third party (the
         "Preferred Beneficiary") regarding certain proprietary technology of
         ObjectSpace (the "License Agreement").

B.       ObjectSpace desires to avoid disclosure of its proprietary technology
         except under certain limited circumstances.

C.       ObjectSpace desires to establish an escrow with DSI to provide for the
         retention, administration and controlled access of certain proprietary
         technology materials of ObjectSpace that are the subject of the License
         Agreement.

D.       The parties desire this Agreement to be supplementary to the License
         Agreement pursuant to 11 United States [Bankruptcy] Code, Section
         365(n).

ARTICLE I -- DEPOSITS

1.1      OBLIGATION TO MAKE DEPOSIT. Upon the signing of this Agreement by the
         parties, including the signing of the Acceptance Form, ObjectSpace
         shall deliver to DSI the proprietary information and other materials
         ("Deposit Materials") required to be deposited by the License
         Agreement, or if the License Agreement does not identify the materials
         to be deposited with DSI, then such materials will be identified on
         Exhibit B as specified below.

1.2      IDENTIFICATION OF TANGIBLE MEDIA. Prior to the delivery of the Deposit
         Materials to DSI, ObjectSpace shall conspicuously label for
         identification each document, magnetic tape, disk, or other tangible
         media upon which the Deposit Materials are written or stored.
         Additionally, ObjectSpace shall complete a description of the Deposit
         Materials ("Deposit Description") in the form of Exhibit B to this
         Agreement by listing each such tangible media by the item label
         description, the type of media and the quantity. The Deposit
         Description must be signed by ObjectSpace and delivered to DSI with the
         Deposit Materials. Unless and until ObjectSpace makes the initial
         deposit with DSI, DSI shall have no obligation with respect to this
         Agreement, except the obligation to notify the parties regarding the
         status of the deposit account as required in Section 2.2 below.

1.3      DEPOSIT INSPECTION. When DSI receives the Deposit Materials and the
         Deposit Description, DSI will conduct a deposit inspection by visually
         matching the labeling of the tangible media containing the Deposit
         Materials to the item descriptions and quantity listed on the Deposit
         Description. In addition to the deposit inspection, Preferred
         Beneficiary may elect to cause a verification of the Deposit Materials
         in accordance with Section 1.6 below.

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1.4      ACCEPTANCE OF DEPOSIT. At completion of the deposit inspection, if DSI
         determines that the labeling of the tangible media matches the item
         descriptions and quantity on Deposit Description, DSI will date and
         sign the Deposit Description and mail a copy thereof to ObjectSpace and
         Preferred Beneficiary. If DSI determines that the labeling does not
         match the item descriptions or quantity on the Deposit Description, DSI
         will (a) note the discrepancies in writing on the Deposit Description;
         (b) date and sign the Deposit Description with the exceptions noted;
         and (c) provide a copy of the Deposit Description to ObjectSpace and
         Preferred Beneficiary. Dsrs acceptance of the deposit occurs upon the
         signing of the Deposit Description by DSI. Delivery of the signed
         Deposit Description to Preferred Beneficiary is Preferred Beneficiary's
         notice that the Deposit Materials have been received and accepted by
         DSL.

1.5      OBJECTSPACE'S REPRESENTATIONS.  ObjectSpace represents as follows:

         a.       ObjectSpace lawfully possesses all of the Deposit Materials
                  deposited with DSI;

         b.       With respect to all of the Deposit Materials, ObjectSpace has
                  the right and authority to grant to DSI and Preferred
                  Beneficiary the rights as provided in this Agreement;

         C.       The Deposit Materials are not subject to any lien or other
                  encumbrance;

         d.       The Deposit Materials consist of the proprietary information
                  and other materials identified in Exhibit B; and

         e.       The Deposit Materials are readable and useable in their
                  current form or, if the Deposit Materials are encrypted, the
                  decryption tools and decryption keys have also been deposited.

1.6      VERIFICATION. Preferred Beneficiary shall have the right, at Preferred
         Beneficiary's sole expense, to request and receive a verification of
         any Deposit Materials. A verification determines, in different levels
         of detail, the accuracy, completeness, sufficiency and quality of the
         Deposit Materials. If a verification is elected after the Deposit
         Materials have been delivered to DSI, then only an employee of DSI
         under signed confidentiality obligations to DSI may perform the
         verification. Any DSI employee performing the verification must
         individually agree in writing to adhere to the confidentiality
         restrictions and provisions of Section 2.1 of this Agreement.

1.7      DEPOSIT UPDATES. Unless otherwise provided by the License Agreement,
         ObjectSpace shall update the Deposit Materials within 60 days of each
         release of a new version of the product which is subject to the License
         Agreement. Such updates will be added to the existing deposit. All
         deposit updates shall be listed on a new Deposit Description and the
         new Deposit Description shall be signed by ObjectSpace. Each Deposit
         Description will be held and maintained separately within the escrow
         account. An independent record will be created which will document the
         activity for each Deposit Description. The processing of all deposit
         updates shall be in accordance with Sections 1.2 through 1.6 above. All
         references in this Agreement to the Deposit Materials shall include the
         initial Deposit Materials and any updates. DSI shall provide
         ObjectSpace with a written invoice (when applicable) and a copy of the
         new Deposit Description within 30 days following DSI's receipt of a
         deposit update.

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1.8      REMOVAL OF DEPOSIT MATERIALS. The Deposit Materials may be removed
         and/or exchanged only on written instructions signed by ObjectSpace and
         the Preferred Beneficiary, or as otherwise provided in this Agreement.

ARTICLE 2 -- CONFIDENTIALITY AND RECORD KEEPING

2.1      CONFIDENTIALITY. DSI shall maintain the Deposit Materials in a secure,
         environmentally safe, locked facility which is accessible only to
         authorized representatives of DSI. DSI shall have the obligation to
         protect the confidentiality of the Deposit Materials. Except as
         provided in this Agreement, DSI shall not disclose, transfer, make
         available, or use the Deposit Materials. DSI shall not disclose the
         existence or content of this Agreement to any third party. If DSI
         receives a subpoena or other order of a court or other judicial
         tribunal pertaining to the disclosure or release of the Deposit
         Materials, DSI will immediately notify the parties to this Agreement.
         It shall be the responsibility of ObjectSpace and/or the Preferred
         Beneficiary to challenge any such order; provided, however, that DSI
         does not waive its rights to present its position with respect to any
         such order. DSI will not be required to disobey any court or other
         judicial tribunal order. (See Section 7.4 below for notices of
         requested orders.)

2.2      STATUS REPORTS. DSI will issue to ObjectSpace and the Preferred
         Beneficiary a report profiling the deposit history ("Escrow Account
         History") at least semi-annually. DSI may provide copies of the Escrow
         Account History pertaining to this Agreement upon the request of
         ObjectSpace or the Preferred Beneficiary. However, DSI understands and
         agrees that this Escrow Account History shall not contain any
         information regarding the fee amounts, fee payment schedule or other
         fee arrangements made between DSI and ObjectSpace related to this
         Agreement. Under no condition will DSI disclose to the Preferred
         Beneficiary or other third party any information regarding the fee
         arrangements made in conjunction with this Agreement.

2.3      AUDIT RIGHTS. During the term of this Agreement, only ObjectSpace and
         the Preferred Beneficiary shall have the right to inspect the written
         deposit records of DSI pertaining to this Agreement. DSI understands
         and agrees that this right shall not apply or extend to the examination
         or inspection of any financial information or fee records by the
         Preferred Beneficiary. Any inspection shall be held during normal
         business hours and following reasonable prior notice.

2.4      USE OF NAMES. DSI recognizes and agrees that nothing in this Agreement
         shall be construed as to grant any right or license to DSI to use the
         name ObjectSpace, Inc. In particular, DSI understands and agrees that
         the name ObjectSpace, Inc. will not be used by DSI for the purposes of
         marketing or otherwise disclosing the existence of this Agreement.

ARTICLE 3 -- GRANT OF RIGHTS TO DSI

3.1      TITLE TO MEDIA. ObjectSpace hereby transfers to DSI the title to the
         media upon which the proprietary information and materials are written
         or stored. However, this transfer does not include the ownership of the
         proprietary information and materials contained on the media

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         such as any copyright, trade secret, patent or other intellectual
         property rights to the works fixed on such media.

3.2      RIGHT TO MAKE COPIES. DSI shall have the right to make copies of the
         Deposit Materials as reasonably necessary to perform this Agreement.
         DSI shall copy all copyright, nondisclosure, and other proprietary
         notices and titles contained on the Deposit Materials onto any copies
         made by DSI. With all Deposit Materials submitted to DSI, ObjectSpace
         shall provide any and all instructions as may be necessary to duplicate
         the Deposit Materials including but not limited to the hardware and/or
         software needed.

3.3      RIGHT TO TRANSFER UPON RELEASE. ObjectSpace hereby grants to DSI the
         right to transfer Deposit Materials to the Preferred Beneficiary upon
         the occurrence of a Release Condition as defined by and in accordance
         with Article 4 for use by the Preferred Beneficiary. Except upon such a
         release or as otherwise provided in this Agreement, DSI shall not
         transfer the Deposit Materials.

ARTICLE 4 -- RELEASE OF DEPOSIT

4.1      RELEASE CONDITIONS. As used in this Agreement, "Release Conditions"
         shall mean the following:

         a.       ObjectSpace becomes the subject of proceedings for its
                  liquidation pursuant to an order for relief entered in a case
                  under Chapter 7 of Title II of the United States [Bankruptcy]
                  Code; or

         b.       ObjectSpace voluntarily elects to cease conducting business
                  and wind up its affairs in accordance with the law of its
                  state of incorporation.

4.2      FILING FOR RELEASE. If the Preferred Beneficiary believes in good faith
         that a Release Condition has occurred, the Preferred Beneficiary may
         provide to DSI written notice of the occurrence of the Release
         Condition and a request for the release of the Deposit Materials. Upon
         receipt of such notice, DSI shall provide a copy of the notice to
         ObjectSpace, by certified mail, return receipt requested, or by
         commercial express mail.

4.3      CONTRARY INSTRUCTIONS. From the date DSI mails the notice requesting
         release of the Deposit Materials, ObjectSpace shall have ten business
         days to deliver to DSI Contrary Instructions. "Contrary Instructions"
         shall mean the written representation by ObjectSpace that a Release
         Condition has not occurred. Upon receipt of Contrary Instructions, DSI
         shall send a copy to the Preferred Beneficiary by certified mail,
         return receipt requested, or by commercial express mail. Subject to
         Section 5.2, DSI will continue to store the Deposit Materials without
         release pending (a) joint instructions from ObjectSpace and the
         Preferred Beneficiary; or (b) order of a court.

4.4      RELEASE OF DEPOSIT. If DSI does not receive Contrary Instructions from
         the ObjectSpace, DSI is authorized to release the Deposit Materials to
         the Preferred Beneficiary or, if more than one beneficiary is
         registered to the deposit, to release a copy of the Deposit Materials
         to the Preferred Beneficiary. However, DSI is entitled to receive any
         fees due DSI before making the release. This Agreement will terminate
         upon the release of the Deposit Materials held by DSI.

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ARTICLE 5 -- TERM AND TERMINATION

5.1      TERM OF AGREEMENT. The initial term of this Agreement is for a period
         of one year. Thereafter, this Agreement shall automatically renew from
         year-to-year unless (a) ObjectSpace and the Preferred Beneficiary
         jointly instruct DSI in writing that the Agreement is terminated; or
         (b) the Agreement is terminated by DSI for nonpayment in accordance
         with Section 5.2. If the Acceptance Form has been signed at a date
         later than this Agreement, the initial term of the Acceptance Form will
         be for one year with subsequent terms to be added to match the
         anniversary date of this Agreement. If the Deposit Materials are
         subject to another escrow agreement with DSI, DSI reserves the right,
         after the initial one year term, to adjust the anniversary date of this
         Agreement to match the then prevailing anniversary date of such other
         escrow arrangements.

5.2      TERMINATION FOR NONPAYMENT. In the event of the nonpayment of fees owed
         to DSI, DSI shall provide written notice of delinquency to ObjectSpace
         and the Preferred Beneficiary. Any such party shall have the right to
         make the payment to DSI to cure the default. If the past due payment is
         not received in full by DSI within one month of the date of such
         notice, then at any time thereafter DSI shall have the right to
         terminate this Agreement to the extent it relates to the delinquent
         party by sending written notice of termination to such affected
         parties. DSI shall have no obligation to take any action under this
         Agreement so long as any payment due to DSI remains unpaid.

5.3      DISPOSITION OF DEPOSIT MATERIALS UPON TERMINATION. Upon termination of
         this Agreement by joint instruction of ObjectSpace and each Preferred
         Beneficiary, DSI shall destroy, return, or otherwise deliver the
         Deposit Materials in accordance with such instructions. Upon
         termination for nonpayment, DSI may, at its sole discretion, destroy
         the Deposit Materials or return them to ObjectSpace. DSI shall have no
         obligation to return or destroy the Deposit Materials if the Deposit
         Materials are subject to another escrow agreement with DSI.

5.4      SURVIVAL OF TERMS FOLLOWING Termination. Upon termination of this
         Agreement, the following provisions of this Agreement shall survive:

         a.       ObjectSpace's Representations (Section 1.5);

         b.       The obligations of confidentiality with respect to the Deposit
                  Materials and the fee arrangements;

         c.       The rights granted in the sections entitled Right to Transfer
                  Upon Release (Section 3.3) and Right to Use Following Release
                  (Section 4.5), if a release of the Deposit Materials has
                  occurred prior to termination;

         d.       The obligation to pay DSI any fees and expenses due;

         e.       The provisions of Article 7; and

         f.       Any provisions in this Agreement which specifically state they
                  survive the termination or expiration of this Agreement.

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ARTICLE 6 -- DSI'S FEES

6.1      FEE SCHEDULE. DSI is entitled to be paid the fees and expenses set out
         and described in a separate fee agreement signed by DSI and ObjectSpace
         (the "Fee Arrangement") that references this Agreement. DSI reserves
         the right to inflate the fees covering this Agreement and described in
         the Fee Arrangement at an increase of no greater than 10% each year.
         DSI shall notify ObjectSpace at least 90 days prior to any increase in
         fees. DSI shall not disclose the existence or contents of this Fee
         Arrangement to the Preferred Beneficiary or any other third party.

6.2      PAYMENT TERMS. DSI shall not be required to perform any service unless
         the payment for such service and any outstanding balances owed to DSI
         are paid in full. All other fees are due within 30 days upon receipt of
         invoice. If invoiced fees are not paid, DSI may terminate this
         Agreement in accordance with Section 5.2. Late fees on past due amounts
         shall accrue at the rate of one and one-half percent per month (18% per
         annum) from the date of the invoice.

ARTICLE 7 -- LIABILITY AND DISPUTES

7.1      RIGHT TO RELY ON INSTRUCTIONS. DSI may assume that any individual
         designated by ObjectSpace or a Preferred Beneficiary either on Exhibit
         D or the Acceptance Form, as the case may be, or in the list of
         authorized personnel ("Authorized Personnel List") in the form of
         Exhibit C who gives any written notice, request, or instruction on
         behalf of either ObjectSpace or the Preferred Beneficiary has the
         authority to do so. DSI may act in reliance upon any instruction,
         instrument, or signature of an individual designated in the Authorized
         Personnel List if DSI has a reasonable belief that the instruction,
         instrument, or signature is genuine. ObjectSpace or a Preferred
         Beneficiary may amend the list of individuals designated in the
         Authorized Personnel List by having an already listed individual notify
         DSI in writing of the amendment. DSI shall not be responsible for
         failure to act as a result of causes beyond the reasonable control of
         DSI.

7.2      INDEMNIFICATION. DSI shall be responsible to perform its obligations
         under this Agreement and to act in a reasonable and prudent manner with
         regard to this Agreement. Provided DSI has acted in the manner stated
         in the preceding sentence, ObjectSpace and Prefer-red Beneficiary shall
         agree to indemnify, defend and hold harmless DSI from any and all
         claims, actions, damages, arbitration fees and expenses, costs,
         attorney's fees and other liabilities incurred by DSI relating in any
         way to this Agreement

7.3      CONTROLLING LAW. This Agreement is to be governed and construed in
         accordance with the laws of the State of Texas, without regard to the
         conflict of law provisions, principles, or statutes of this or any
         jurisdiction. The parties agree to submit to the jurisdiction and venue
         of the state and federal courts of Texas.

7.4      NOTICE OF REQUESTED Order. If any party intends to obtain an order from
         a court of competent jurisdiction which may direct DSI to take, or
         refrain from taking, any action, that party shall:

         a.       Give DSI reasonable prior notice of the hearing;

         b.       Include in any such order that, as a precondition to DSI's
                  obligation, DSI be paid in full for any past due fees and be
                  paid for the reasonable value of the services to be rendered
                  pursuant to such order; and

                                                                             6
<PAGE>

         c.       Ensure that DSI not be required to deliver the original (as
                  opposed to a copy) of the Deposit Materials if DSI may need to
                  retain the original in its possession to fulfill any of its
                  other escrow duties.

ARTICLE 8 -- GENERAL PROVISIONS

8.1      ENTIRE AGREEMENT. This Agreement, which includes the Acceptance Form
         and the Exhibits described herein, embodies the entire understanding
         between all of the parties with respect to its subject matter and
         supersedes all previous communications, representations or
         understandings, either oral or written that are not referred to herein.
         No amendment or modification of this Agreement shall be valid or
         binding unless signed by all parties hereto, except that Exhibit B need
         not be signed by Preferred Beneficiary, Exhibit C and Exhibit D need
         not be signed, and the Acceptance Form and Fee Arrangement will be
         signed by the parties identified therein.

8.2      NOTICES. All notices, invoices, payments, deposits and other documents
         and communications shall be given to the parties at the addresses
         specified in the list of designated contacts ("Designated Contact
         Listing") in the form of Exhibit D. It shall be the responsibility of
         the parties to notify each other as provided in this Section in the
         event of a change of address. The parties shall have the right to rely
         on the last known address of the other parties. Unless otherwise
         provided in this Agreement, all documents and communications may be
         delivered by First Class mail.

8.3      SEVERABILITY. In the event any provision of this Agreement is found to
         be invalid, voidable or unenforceable, the parties agree that unless it
         materially affects the entire intent and purpose of this Agreement,
         such invalidity, voidability or unenforceability shall affect neither
         the validity of this Agreement nor the remaining provisions herein, and
         the provision in question shall be deemed to be replaced with a valid
         and enforceable provision most closely reflecting the intent and
         purpose of the original provision.

8.4      SUCCESSORS. This Agreement shall be binding upon and shall inure to the
         benefit of the successors and assigns of the parties. However, DSI
         shall have no obligation in performing this Agreement to recognize any
         successor or assign of ObjectSpace or the Preferred Beneficiary unless
         DSI receives clear, authoritative and conclusive written evidence of
         the change of parties.

         ObjectSpace, Inc.                 Data Securities International, Inc.

By:      /s/ LAUREL W. FITZGERALD          By:    /s/ CHRISTIE WOODWARD
         -----------------------------            ------------------------------
Name:    Laurel W. Fitzgerald              Name:  Christie Woodward
         -----------------------------            ------------------------------
Title:   VP-Operations                     Title: Sr. Contract Administrator
         -----------------------------            ------------------------------
Date:    10/30/98                          Date:  11/3/98
         -----------------------------            ------------------------------

                                                                               7
<PAGE>

                                                                      EXHIBIT C

                            AUTHORIZED PERSONNEL LIST
                           Account Number ____________

Name:                 Laurel W. Fitzgerald
                      -----------------------------
Title:                VP - Operations
                      -----------------------------
Contact Information:
                      -----------------------------

                      -----------------------------

                      -----------------------------

                                                                              8
<PAGE>

                                                                       EXHIBIT D

                           DESIGNATED CONTACT LISTING

                        Account Number _________________

Notices, deposit material returns and         Invoices to ObjectSpace should be
communications to ObjectSpace should                   addressed to:
be addressed to:

Company Name:        Objectspace, Inc.                 Laurel Fitzgerald
               ------------------------------    ------------------------------
Address:             14850 Quorum Drive                Objectspace, Inc.
               ------------------------------    ------------------------------
                     Suite 500                         14850 Quorum Drive
               ------------------------------    ------------------------------
                     Dallas, TX 75240                  Suite 500
               ------------------------------    ------------------------------
Designated Contact:  Laurel Fitzgerald                 Dallas, TX 75240
                     ------------------------    ------------------------------
Telephone:  972-726-4241
            ---------------------------------    ------------------------------
Facsimile:  972-715-9041
            ---------------------------------    ------------------------------

Requests from ObjectSpace to change the designated contact should be given in
writing by one of the individuals designated in the Authorized Personnel List in
the form of Exhibit C.

Contracts, Deposit Materials                    Invoice inquiries and fee
and notices to DSI                              remittances to

DSI should be addressed to:                     should be addressed to:

DSI                                             DSI
Contract Administration                         Accounts Receivable
Suite 200                                       Suite 1450
9555 Chesapeake Drive                           425 California Street
San Diego, CA 92123                             San Francisco, CA 94104
Telephone: (619) 694-1900                       (415) 398-7900
Facsimile: (619) 694-1919                       (415) 398-7914

Date: ______________________________

                                                                              9

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