Document:

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                                                                   EXHIBIT 10.11

                        TRANSLATION FROM THE HEBREW
                                                                 Lease Agreement
                                                                  Beit Hacrystal

                        UNPROTECTED LEASE AGREEMENT

               Made and signed in Bnei-Brak on December 31, 1999

                                 By and between:

               Nichsei Crystal Lemischar (Ramat-Gan)
               (Private Company Registration No. 51-036459-9)
               A private company duly registered in Israel
               Whose address for the purpose of this agreement is
               at 12, Hachilazon St., Ramat-Gan.

                                               (hereinafter: the "Lessor")
                                                        of the first part
                                      And:

               XACCT Technologies (1997) Ltd.
               (Private Company Registration No. 51-249311-5)
               Whose address for the purpose of this agreement is
               at 31, Halehi Street, Bnei Brak

                                               (hereinafter: the "Lessee")
                                                        of the other part

Whereas        the Lessor is the registered owner of the property known as
               Parcel No. 365 in Block No. 6109, situated at 12, Hachilazon
               Street, Ramat Gan, covering a registered area of approximately
               2,852 sq.m. gross (hereinafter: the "Lot"); and

Whereas        the Lessor has built on the Lot, inter alia, a project
               consisting of an 8-10 floor office building, a commercial level
               and a gallery, with four basement levels, covering a total area
               of circa 9,500 sq.m. for office use, circa 1,000 sq.m. for
               commercial use and circa 12,000 sq.m. basements, the basement
               levels primarily to

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               consist of an underground parking lot and approximately 1,200
               sq.m. technical space (hereinafter: the "Building"); and

Whereas        the Lessor is, accordingly, also the holder and owner of a
               Building unit on the second floor above the ground floor facing
               north-east covering approximately 455 sq.m. gross (including a
               pro rata share in the common property) (hereinafter: the
               "Second-Floor Leasehold"), as well as a unit covering the entire
               area of the third floor above the ground floor covering
               approximately 1,200 sq.m. gross (including a pro rata share in
               the common property) (hereinafter: the "Third-Floor Leasehold"),
               all as marked in the area encircled by red in the attached
               diagram (hereinafter: the "Diagram"), marked A, constituting an
               inseparable part hereof (the Second-Floor Leasehold and the
               Third-Floor Leasehold shall hereinafter be referred to as: the
               "Leasehold"); and

Whereas        the Lessee wishes to lease the Leasehold under unprotected
               lease pursuant to the Tenants Protection Law (Combined Version)
               5732-1972 (hereinafter: the "Law") or any other law; and

Whereas        the Lessor wishes to lease the Leasehold under an unprotected
               lease pursuant to the Tenants Protection Law (Combined Version),
               5732-1972, or any other law;

NOW, THEREFORE, IT IS AGREED AND STIPULATED BY AND BETWEEN THE PARTIES AS
FOLLOWS:

1. PREAMBLE, APPENDIXES AND HEADINGS:

         1.1      The Preamble hereto constitutes an inseparable part hereof.

         1.2      The appendixes hereto constitute an inseparable part hereof
                  and shall be deemed as the provisions hereof.

         1.3      The headings herein are for convenience only and shall not be
                  used for the interpretation of the contents thereof.

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2.       PARTIES' DECLARATIONS

         2.1      The Lessor hereby declares that it is the sole holder and
                  Owner of the Leasehold, that it is authorized to lease the
                  Leasehold to the Lessee and that there is no impediment of
                  whatever nature to leasing the Leasehold to the Lessee.

         2.2      The Lessee hereby declares that it has viewed and examined the
                  Leasehold, that following such examination it has found same
                  fit for its purposes and objectives and that it waives any
                  contention with respect to defect, the right to cancel the
                  transaction due to a defect or incompatibility with respect to
                  the Leasehold other than hidden defect, with respect to the
                  location of the Leasehold and the identification thereof, and
                  it agrees to accept the Leasehold in its condition on the date
                  of entering into this Agreement, subject to the completions
                  pursuant to the plans and technical specification attached
                  hereto.

3.       TRANSACTION AND TERM THEREOF

         3.1      The original term of lease

                  The Lessor hereby leases the Leasehold to the Lessee and the
                  Lessee hereby leases the Leasehold from the Lessor for a lease
                  term commencing no later than 60 days as of the date of
                  delivery of the Third-Floor Leasehold's interior plans by the
                  Lessee and no later than 75 days as of the date of delivery of
                  the Second-Floor Leasehold's interior plans and ending three
                  years as of the commencement of the lease of the Second-Floor
                  Leasehold (hereinafter: the "Original Term of Lease"). The
                  Lessee shall deliver complete and adapted interior plans no
                  later than 30 days following the date of signature hereof. It
                  is agreed that a delay by the Lessor in handing over the
                  Leasehold of up to 14 days vis-a-vis the said dates shall not
                  constitute a breach.

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         3.2      Option

                  3.2.1    The Lessee is hereby granted an optional right
                           (option) to extend the Original Term of Lease for
                           three additional years as of the end of the Original
                           Term of Lease (hereinafter: the "First Option Term"),
                           subject to giving the Lessor a 90-days prior written
                           notice before the end of the Original Term of Lease
                           of its wish to exercise the option, and subject
                           further to the provisions of sub-clause 3.2.2.

                  3.2.2    The right to extend the Lease Agreement as aforesaid
                           shall be subject to the Lessee's fulfillment of all
                           the provisions hereof throughout the Original Term of
                           Lease, including payment of the rent applicable to it
                           hereunder with respect thereto, as well as full and
                           timely fulfillment of all its other obligations. It
                           is agreed that all the provisions hereof pertaining
                           to the Original Term of Lease shall also apply during
                           the First Option Term, subject to the changes herein
                           set out.

         3.3      Shortening the Original Term of Lease

                  3.3.1    The Lessee declares that it is aware that the
                           duration of the Original Term of Lease is a
                           fundamental provision hereof and hence the Lessee
                           shall not be entitled to shorten the Original Term of
                           Lease without the Lessor's prior written approval.
                           Should the Lessee leave the Leasehold prior to the
                           end of the Original Term of Lease, for whatever
                           reason, without the Lessor's prior written approval,
                           the Lessee shall continue paying the full rent for
                           the Leasehold hereunder to the Lessor, up to the end
                           of the Original Term of Lease.

                  3.3.2    The provisions hereof shall also apply to the
                           management fee payable by the Lessee to the
                           management company as

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                           hereinafter specified, as well as all other financial
                           obligations payable by it pursuant to this Agreement,
                           solong as the duty to pay rent applies to the Lessee.

                  3.3.3    Notwithstanding the foregoing the Lessee may find an
                           alternative lessee or a sub-lessee under the same
                           terms, provided that such alternative or sub-lessee
                           shall be acceptable to the Lessor and shall furnish
                           sureties to the Lessor's full satisfaction. The
                           Lessor shall not unreasonably withhold its consent
                           with respect to such alternative or sub-lessee.

4.       RENT AND ADDITIONAL PAYMENTS

         4.1      Rent during the Original Term of Lease and date of payment:

                  In consideration for the rights to lease the Leasehold during
                  the Original Term of Lease, the Lessee undertakes to pay rent
                  to the Lessor in the amounts and installments as follows:

                  4.1.1    The rent for each month during the Original Term of
                           Lease shall be as follows:

                           a.       For the  Third-Floor  Leasehold - the amount
                                    of NIS 97,344 (agreed  representative  rate
                                    - NIS 4.16 per one American dollar x $19.5
                                    x 1200 sq.m.) per month, plus VAT at law.

                           b.       For the Second-Floor  Leasehold - the amount
                                    of NIS 36,910 (agreed  representative  rate
                                    - NIS 4.16 per one American dollar x $19.5
                                    x 455 sq.m.) per month, plus VAT at law.

                                    The rent for the Third-Floor Leasehold
                                    together with the rent for the Second-Floor
                                    Leasehold shall hereinafter be referred to
                                    as: the "Rent").

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                  4.1.2    The parties agree that the Rent shall be linked to
                           the Consumer Price Index (hereinafter: the "Linkage
                           Differences") as follows:

                           Index differences shall be added to each payment
                           (hereinafter: the "Differences") so that where it is
                           clarified that the new index exceeds the basic index
                           in respect of any payment on account of the Rent, the
                           Lessee shall pay an increment on the Rent to the
                           Lessee at the rate equivalent to the increase of the
                           new index vis-a-vis the basic index, the Linkage
                           Differences increment being paid together with each
                           payment on account of the Rent.

                           In this Agreement:

                           "Index" - means the Consumer Price Index (including
                           vegetables and fruits, without neutralizing any of
                           the index components) that is published monthly by
                           the Central Bureau of Statistics or any other entity
                           superseding same, or any other index published in its
                           place (subject to the ratio between such indexes).
                           It is agreed that the basic index means the index for
                           November 1999 published on December 15, 1999.

                           "New Index" - the Consumer Price Index last published
                           prior to the actual payment of any of the Rent
                           payments.

                  4.1.3    Linkage Differences, as aforesaid, shall be added to
                           each payment. In addition to the Linkage Differences,
                           the Lessee shall pay VAT at its present rate under
                           law on the actual date of payment to the Lessor,
                           against receipt of tax invoice at law, by means of a
                           postdated check for the date such VAT is payable by
                           the Lessor.

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                  4.1.4    The Rent for the Original Term of Lease shall be paid
                           on the following dates:

                           a.       On the date of signature hereof the Lessee
                                    shall pay Rent to the Lessor for 9 months in
                                    advance (NIS 402,756 with the addition of
                                    VAT at law).

                           b.       The balance of the Rent, together with the
                                    Linkage Differences and the VAT at law,
                                    shall be paid by the Lessee to the Lessor in
                                    consecutive equal quarterly installments on
                                    the first of the Gregorian month following
                                    three months from the commencement of the
                                    Lease, and every three Gregorian months up
                                    to the end of the Lease.

                  4.1.5    Full and timely payment of the Rent or any other
                           payment applicable to the Lessee hereunder, is a
                           fundamental provision hereof, and failure to timely
                           settle any payment shall be deemed as a fundamental
                           breach hereof by the Lessee, and shall grant the
                           Lessor all the relief hereunder and pursuant to the
                           Law, including the right to claim removal of the
                           Lessee from the Leasehold immediately after the delay
                           in payment provided that any delay of up to 5 working
                           days shall [handwritten: "not" (-signed-),(-stamped &
                           signed-)] constitute a fundamental breach of this
                           Agreement.

                  4.1.6    In addition to the Leasehold, the Lessee hereby
                           leases from the Lessor the right to use 5 reserved
                           parking places and 50 non-reserved parking places.

                  4.1.7    In consideration for the right to use the parking
                           places, the Lessee shall pay the Lessor monthly
                           amounts as follows:

                           a.       For the monthly right to use 5 reserved
                                    parking places - the amount of NIS 2,808
                                    (agreed

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                                    representative rate of NIS 4.16 per
                                    one American dollar x 5 x 135$) with the
                                    addition of VAT and Linkage Differences.

                           b.       For the monthly right to use 50 non-reserved
                                    parking places - the amount of NIS 20,800
                                    (agreed representative rate of NIS 4.16 per
                                    one American dollar x 50 x 100$) with the
                                    addition of VAT and Linkage Differences.

                           c.       The Rent for the use of the parking  places
                                    is in addition to the Rent for the
                                    Leasehold and shall be paid jointly, on the
                                    date of each payment on account of the Rent.

                  4.1.8    The Lessee is hereby granted the option to lease at
                           least 30 more non-reserved parking places during the
                           Term of Lease at $100 (to be converted into New
                           Shekels on the date of exercising the option, linked
                           to the index) per parking place, with the addition of
                           VAT and Linkage Differences.

                  4.1.9    To remove any doubts, it is hereby clarified that the
                           Lessor shall pay the municipal property tax for the
                           parking lot.

         4.2      The Rent during the First Option Term shall increase by 10%
                  as follows:

                  4.2.1    The Rent during the First Option Term shall be NIS
                           147,680 per month ($35,000 at the agreed
                           representative rate of NIS 4.16 per American dollar)
                           with the addition of VAT at law, linked as of the
                           date of the basic index.

                  4.2.2    All the provisions of this Agreement with respect to
                           the Original Term of Lease, including, without
                           derogating from the generality of the aforesaid, the
                           manner of linkage

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                           of the basic monthly Rent during the Option Term to
                           the index, the addition of VAT and the date of
                           payment of the Rent, shall fully apply to the Option
                           Term, respectively.

         4.3      Taxes and obligatory payments

                  4.3.1    The Lessee shall pay all taxes and obligatory
                           payments applicable to the holder of a Leasehold and,
                           inter alia, shall bear payments of general rates,
                           business tax, sign fees, electricity, water,
                           telephone (including permanent usage fees), payment
                           to the management and services company and all other
                           and/or additional current expenses with respect to
                           current maintenance of the Leasehold, as of the date
                           of accepting possession in the Leasehold.

                  4.3.2    The Lessee declares that it is aware that a
                           management and services company is and/or shall be in
                           operation in the Building for the purpose of
                           providing maintenance, operation, repair and upkeep
                           services of the Building, its facilities and the
                           common property therein, including gardening,
                           lighting, air-conditioning, operation of elevators,
                           guarding the Building, etc.
                           The Lessee undertakes to fully and timely effect, as
                           provided herein and/or in the management agreement,
                           all the payments payable to the management company
                           and/or the Lessor in consideration for the
                           management services.

         4.4      Stamping

                  Stamping fees with respect to this Agreement, if necessary,
                  apply to the Lessee and be fully borne by it.

         4.5      Effecting an obligatory payment by the Lessor

                  4.5.1    Should the Lessee fail to timely effect any of the
                           payments applicable to it pursuant to the provisions
                           of clause 4

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                           herein (including all sub-clauses thereof) the Lessor
                           may pay in such event any such payment in place of
                           the Lessee and the Lessee shall have to refund same
                           to the Lessor upon the Lessor's first demand.

                           To remove any doubts it is hereby clarified that
                           nothing in the foregoing shall constitute an
                           undertaking by the Lessor to make any payment in
                           place or on behalf of the Lessee.

                  4.5.2    In the event that any of the parties makes any
                           payment in place of the other party or on its behalf,
                           as aforesaid, the other party shall refund any such
                           payment to the paying party immediately upon demand
                           and any such payment shall be subject to the
                           provisions of clause 9.1 hereinbelow.

5.       TERMS OF LEASE

         5.1      Changes to the Leasehold

                  5.1.1    The Lessee may perform interior changes to the
                           Leasehold at its expense solely pursuant to a plan to
                           be submitted to the Lessor for its prior written
                           approval. The Lessee shall not make any changes to
                           the Leasehold which are not interior changes nor
                           shall it make any changes relating to the Building's
                           construction or systems (including air- conditioning,
                           plumbing, elevators systems and so forth).

                  5.1.2    The Lessor shall not unreasonably withhold its
                           approval to the Lessee with respect to planning the
                           interior of the Leasehold as the Lessee deems fit,
                           and for this purpose to make changes in the Leasehold
                           (other than prohibited changes as aforesaid), subject
                           to the approval of the management company which shall
                           not unreasonably withhold such approval.

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                  5.1.3    In the event that the Lessee violates its foregoing
                           undertaking, the Lessor shall be entitled to restore
                           the Leasehold to its former condition at the Lessee's
                           expense.

                  5.1.4    The Lessee undertakes to perform the completions
                           and/or changes, if any, to the best of its ability,
                           prudently, without causing any damage to the
                           Leasehold and/or the Building, in compliance with the
                           management company's instructions, if any, with
                           respect to the manner of performing the works.

                           The Lessee shall bear any direct or indirect damages
                           and the consequences thereof caused to the Leasehold
                           or the Building due to performing the completions
                           and/or arising from such type of changes in the
                           Leasehold.

         5.2      Signs and telephones

                  The Lessee may not install any sign on the exterior space of
                  the Leasehold. Signs shall only be installed at the spots
                  designated therefor, after obtaining the prior written
                  approval of the management company and the Lessor, both with
                  respect to the actual placement of the sign, and the size and
                  shape thereof.

                  The Lessor has no objection to the Lessee installing telephone
                  lines in the Leasehold, at its expense.

         5.3      Orderly maintenance and Lessor's inspection

                  5.3.1    The Lessee hereby undertakes to look after the
                           Leasehold and everything attached therein by the
                           Lessor and/or by the Lessee throughout the Original
                           Term of Lease, and to upkeep the Leasehold and
                           procure the orderly maintenance thereof.

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                  5.3.2    Any failure or damage caused by the Lessee, its
                           employees, agents, or visitors, other than damage due
                           to reasonable wear, shall be repaired by the Lessee
                           within a reasonable period of time, at its expense.
                           Any failure that is the fault of the Lessor shall be
                           repaired by the Lessor within a reasonable period of
                           time.

                  5.3.3    Should the Lessee fail to repair such damages and
                           failures within a reasonable period of time, taking
                           into account the type of repair, after notice has
                           been given and which the Lessee has failed to rectify
                           within 7 days, the Lessor may, however, is not
                           obligated to, repair same and the Lessee shall bear
                           all the expenses of the repairs made by the Lessor.

                  5.3.4    The Lessee shall make any payment to the Lessor
                           pursuant to sub-clause 5.3.3 above within 7 days from
                           the date on which the invoice for the repairs has
                           been submitted to it, and any such payment shall be
                           subject to the provisions of sub-clause 9.1 hereof.

                  5.3.5    The Lessee hereby undertakes to permit the Lessor,
                           its employees and agents, to enter the Leasehold at
                           reasonable times, after prior coordination, in the
                           course of the Original Term of Lease, to examine the
                           condition of the Leasehold and to perform any
                           maintenance works therein.

                  5.3.6    The Lessor, its employees and agents may further
                           enter the Leasehold at reasonable times, subject to
                           prior coordination, in the course of the last six
                           months of the lease, to show same to prospective
                           purchasers or lessees.

                  5.3.7    The Lessor's duty to coordinate entry into the
                           Leasehold in advance as aforesaid shall not apply to
                           emergencies such as fire, flood, and so forth
                           requiring immediate entry into the Leasehold.

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         5.4      Prohibited uses

                  5.4.1    The Lessee may only use the Leasehold for the purpose
                           of hi-tech and offices and not for any other purpose.

                  5.4.2    Without derogating from the foregoing in sub-clause
                           5.4.1 above, the Lessee may not:

                           a)       Perform in the Leasehold any work making
                                    unreasonable noise or spreading smoke,
                                    odors, pollution etc.

                           b)       Use the Leasehold for purposes which are
                                    prohibited under any law.

                  5.4.3    In the event that the use under the purpose of the
                           lease requires a license under law, the Lessee
                           undertakes to obtain such license.

                           The Lessee shall bear any liability with respect to
                           managing a business in the Building without a license
                           where a license is necessary.

         5.5      Renovation of the Leasehold

                  5.5.1    To remove any doubt, it is hereby clarified that any
                           renovations performed in the Building (including
                           renovations made in whole or in part by and at the
                           Lessee's expense) shall be the exclusive property and
                           ownership of the Lessor and the Lessee shall not be
                           entitled to any compensation or indemnification due
                           to such renovations, and the Lessee shall deliver
                           possession in the Leasehold to the Lessor upon
                           completion of the Term of Lease, the property being
                           clean and tidy, including all renovations and
                           improvements made in the property.

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                  5.5.2    Without derogating from the generality of the
                           foregoing with respect to the Lessee's obligations
                           relating to the use of the Leasehold and the
                           operation thereof, it is hereby expressly agreed and
                           stipulated by the parties that the Lessee shall be
                           exclusively responsible for obtaining all approvals,
                           permits, and licenses necessary for operating its
                           business in the Leasehold under the provisions of any
                           law, including a business license, a sign license and
                           any other license or permit required for the purpose
                           of performing the renovations.

6.       DAMAGES TO THIRD PARTIES AND INSURANCE

         6.1      Without derogating from the Lessee's liability under this
                  Agreement and/or under any law, the Lessee hereby undertakes
                  to issue the following insurance policies at its expense:

                  The Lessor shall not bear any liability whatever for damage
                  caused to the Lessee's body or property, to its employees,
                  customers, visitors, invitees or any third party, including
                  tenants adjacent to the Leasehold, caused in consequence of or
                  due to the use of the Leasehold by the Lessee or anyone on its
                  behalf.

                  The Lessee undertakes to indemnify the Lessor for any amount
                  the Lessor is obligated to pay as aforesaid, if any, including
                  any ancillary expense, such as the cost of legal proceedings.
                  (Handwritten: [-Stamped & Signed-] On the other hand, the
                  Lessor undertakes to notify the Lessee of any such demand
                  within 7 days of the date it learned thereof, so as to enable
                  it to defend against same.)

                  INSURING THE CONTENTS OF THE LEASEHOLD

                  6.1.1    The Lessee undertakes to insure the contents of the
                           Leasehold and, without derogating from the generality
                           of

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                           the foregoing, the furniture, the equipment,
                           facilities and inventory therein, as well as any
                           change, improvements, renovation and additions to the
                           Leasehold made and/or to be made in the Leasehold by
                           the Lessee and/or on its behalf, of whatever nature,
                           all the foregoing being at restoration value against
                           loss or damage due to risks of fire, explosion,
                           earthquake, riots, strikes, malicious damage, storm,
                           tempest, flood, water damages, electrical damages,
                           burglary and robbery, injury by aircraft, supersonic
                           explosion and collision.

                  6.1.2    The Lessee undertakes to update the amounts of the
                           insurance, from time to time, so as to reflect at all
                           times the full value of the insured property as
                           aforesaid in sub-clause 5.1.1 above.

                  6.1.3    The Lessee  undertakes at all times that the policy
                           issued by it as aforesaid in sub-clause 6.1.1 above,
                           or any other policy issued by it, shall  incorporate
                           an express clause whereby the insurer expressly
                           waives any subrogation right vis-a-vis the Lessor,
                           and the  management  company and/or their
                           representatives.  Such waiver of  subrogation shall
                           also apply to the other  lessees/tenants  in the
                           Building  (provided  that the insurance policies of
                           the tenants' and the lessees' contents  incorporate
                           a clause with respect to waiver of indemnification
                           vis-a-vis all the lessees  and/or  tenants in the
                           Building)  and/or anyone on behalf of the  foregoing.
                           The  aforesaid respecting waiver of the subrogation
                           right  shall  not apply in the event of malicious
                           damage.

                           The Lessee hereby exempts the Lessor and the
                           management company and anyone acting on their behalf
                           from liability with respect to loss or damage for
                           which the Lessee is or should have been entitled for
                           indemnity under the policy to be issued as aforesaid.

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                  EMPLOYERS AND THIRD PARTY

                  6.1.4    THIRD PARTY - the Lessee undertakes to issue a policy
                           covering  liability to third  parties  insuring the
                           Lessee's liability for bodily and/or property damage
                           of any person and/or entity arising from operating in
                           and/or in the vicinity of the Leasehold.
                           The insurance shall be for a limit of liability of no
                           less than the NIS equivalent of US$500,000 per event
                           per period.
                           The insurance shall be extended to indemnify the
                           Lessor for its liability to the Lessee's actions
                           and/or omissions subject to a cross liability clause
                           under which the insurance shall be deemed as if
                           issued separately for each of the insured's
                           individuals.

                           Such insurance shall not be subject to any limitation
                           on liabilities arising from fire, explosion, alarm,
                           lifting, loading and unloading devices, defective
                           sanitary devices, poisoning, any harmful substance in
                           drinks or foods, strikes and lockouts as well as a
                           subrogation claim on the part of the National
                           Insurance Institute.

                           EMPLOYERS' LIABILITY - the Lessee undertakes to issue
                           at its expense an employer's liability insurance
                           covering the Lessee's liability to its employees for
                           bodily damage arising from and while at work, in a
                           limit of liability of no less than the NIS equivalent
                           of US$5,000,000 per event per period.

                           The insurance shall be extended to indemnify the
                           Lessor for its liability to the Lessee's employees
                           where it is established that it is their employer.

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                                       17

                           Such insurance shall not include any limitation on
                           works at altitude and at depth, work hours,
                           contractors, sub- contractors and youth employment.

                  6.1.5    The policies  issued by the Lessee as  aforesaid  in
                           clause 6 hereof  shall be referred to as the
                           "Lessee's Policies".

                  CROSS LIABILITY

                  6.1.6    Furthermore, the Lessee hereby undertakes that any
                           third party and employer's insurance issued by it
                           hereunder shall be subject to a "cross liability"
                           clause under which the insurance shall be deemed as
                           if made separately for each of the insured's
                           individuals.

                  POLICIES IN EFFECT

                  6.1.7    The Lessee undertakes to fulfill all the terms of the
                           Lessee's Policies and to ensure timely payment of the
                           premiums.

                  INSURER'S APPROVAL

                  6.1.8    The Lessee shall present to the Lessor, no later than
                           30 days as of the signature hereof, an approval from
                           the insurance company stating that the Lessee's
                           policies were issued for the Lessee. Such approvals
                           shall be presented once every insurance year by the
                           Lessee without the Lessor's demand. It is hereby
                           expressly agreed that the presentation of such
                           approvals or presentation of the Lessee's Policies
                           and the examination thereof by the Lessor or anyone
                           on its behalf shall not constitute approval that the
                           Lessee's Policies or such approvals are in compliance
                           with the contents of the insurance clause and same
                           shall not derogate from the Lessee's responsibility
                           hereunder.

<PAGE>

                                       18

                  CANCELLATION OF POLICIES

                  6.1.9    It is further agreed that the Lessee's Policies shall
                           incorporate an express clause under which the
                           policies may not be canceled unless written notice
                           thereof is given by registered mail to the Lessor at
                           least 60 days in advance. (Handwritten: [-Stamped &
                           Signed-] Nothing in the foregoing shall derogate from
                           the Lessee's duty to procure alternative insurance.)

                  DAMAGE ARISING FROM RISKS

                  6.1.10   The Lessee hereby declares that it shall have no
                           claim and/or demand against the Lessor and the
                           management company and/or anyone acting on its behalf
                           due to damage arising from risks which the Lessee
                           undertook to insure as aforesaid in the above
                           clauses, and it exempts the Lessor and the management
                           company and/or anyone acting on their behalf from any
                           liability for such damages.

                           This clause is aimed at adding rather than derogating
                           from any other provision herein.

                           Breach of the insurance clause shall constitute a
                           fundamental breach of this Agreement.

         6.2      If and to the extent that funds are obtained from the
                  insurance company for damages to the Leasehold or the common
                  property, such funds shall be used at the first phase for
                  repairing the Leasehold or other assets in the Building, and
                  the balance thereof shall be transferred to the Lessee.

7.       VACATING THE LEASEHOLD AND RENOVATIONS THERETO

         7.1      Vacating the Leasehold

<PAGE>

                                       19

                  Subject to the provisions of sub-clause 3.3 above, the Lessee
                  undertakes to vacate the Leasehold at the end of the Original
                  Term of Lease or the Option Term or, in the event of
                  cancellation of the Agreement, prior to the end of the
                  Original Term of Lease, and return the same to the Lessor, it
                  being vacant of any person and chattel, in good, orderly and
                  serviceable condition, in the same condition as it was
                  received when it was first leased, other than reasonable
                  normal wear.

         7.2      Renovations to the Leasehold

                  7.2.1    45 days prior to returning the Leasehold by the
                           Lessee to the Lessor the Lessor shall conduct an
                           examination of the Leasehold. At such time a protocol
                           shall be recorded, specifying the list of repairs
                           which the Lessee is obligated to perform pursuant to
                           the provisions of this Agreement, including repair of
                           damage and failures and repairs pertaining to
                           restoring the Leasehold to its previous condition,
                           other than ordinary wear arising from reasonable use
                           of the property. The Lessee shall make the necessary
                           repairs in accordance with the protocol.

                  7.2.2    It is agreed that the parties shall deem the period
                           necessary for making the repairs set out in
                           sub-clause 7.2.1 hereof as a period in which the
                           Lessee was in delay of vacating the Leasehold, and
                           such period shall be subject to all the provisions of
                           this Agreement with respect to delay in vacating the
                           Leasehold.

8.       GENERAL PROVISIONS

         8.1      Management agreement

                  8.1.1    The Lessee undertakes to enter into a management
                           agreement with the management company for the

<PAGE>

                                       20

                           provision of services and maintenance to the
                           Building's facilities, upon signature of this
                           Agreement or at any other time, pursuant to the
                           Lessor's instructions to the Lessee. The form of the
                           management agreement is attached hereto, constituting
                           an inseparable part hereof.

                  8.1.2    The provisions and terms of the management agreement
                           shall be deemed as the provisions and terms hereof,
                           and any breach thereof or failure to fulfill same
                           shall be deemed as a breach of or non-compliance with
                           the provisions and terms of this Agreement.

                  8.1.3    The management fees (hereinafter: the "Management
                           Expenses") shall be linked to the index and be paid
                           by the Lessee to the Lessor or to the management
                           company as set out in sub-clause 8.a. of the services
                           agreement signed and/or to be signed by the Lessor
                           and the services company in the Building, and where
                           there is no reference in such clause, the Management
                           Expenses shall be paid as follows:

                           1.       The Management Expenses shall be paid once
                                    every three months, for three months in
                                    advance, on the dates herein set forth for
                                    payment of the Rent, being linked to the
                                    index as aforesaid herein, however, in no
                                    event shall the Management Expenses per
                                    quarter be less than the Management Expenses
                                    actually paid (including Linkage
                                    Differences) for the preceding quarter.

                           2.       The Lessee shall deliver to the Lessor, 7
                                    (seven) days prior to the date of handing
                                    over the Leasehold, 4 (four) checks signed
                                    by it, each at the rate of the Management
                                    Expenses anticipated for the quarter, with
                                    the addition of Linkage Differences to the
                                    index, as of the basic index up to

<PAGE>
                                       21

                                    the index known on the date of delivery of
                                    the checks, payable on the 1st of each
                                    quarter.

                           3.       On the 1st of each quarter the Lessee shall
                                    hand over to the Lessor as follows:

                                    A check for the Linkage Differences as of
                                    the index known on the date of delivering
                                    the checks, as set forth in sub-clause 2, up
                                    to the new index for the Management Expenses
                                    for such quarter.

                                    A check to cover the Management Expenses for
                                    the quarter following the last quarter for
                                    which a check was given to the Lessor for
                                    Management Expenses, with the addition of
                                    Linkage Differences to the index, as of the
                                    basic index up to the index known on the
                                    date of delivering the check.

                           4.       Only actual payment of the checks shall be
                                    deemed as payment of the Management
                                    Expenses.

                           5.       A tax invoice shall be furnished to the
                                    Lessee within seven (7) days of the date of
                                    actual payment.

         8.2      Transfer of rights in the Leasehold

                  8.2.1    The Lessor shall be entitled to transfer or mortgage
                           its rights hereunder at any time, and to transfer or
                           mortgage its rights in the Leasehold or lease and
                           sell the Leasehold, provided it gives notice to the
                           transferee or the purchaser or leaseholder of the
                           rights (as the case may be) of the existence of this
                           Agreement, and the transferee or the purchaser or
                           leaseholder shall undertake all the Lessor's
                           undertakings hereunder. In such event the Lessee
                           shall have no claims or contentions with respect to
                           the transfer

<PAGE>
                                       22

                           of the rights and the sale thereof or
                           due to the lease of the Leasehold by the Lessor.

                  8.2.2    The Lessee shall not be entitled to transfer all or
                           any of its rights hereunder, nor permit others to use
                           all or any Part of the Leasehold whether for a
                           consideration or otherwise, or lease the same under
                           a sub-lease, directly or indirectly, to any person or
                           entity, all subject to sub-clause 3.3.3 above.
                           Notwithstanding the foregoing, the Lessee may include
                           another lessee from the group of the Lessee's
                           subsidiaries or affiliated companies (hereinafter:
                           the "Additional Lessee") in the Leasehold, and
                           provided further that the Additional Lessee shall
                           sign a promissory note to vacate the Leasehold on the
                           date when the Lessee is obligated to vacate the
                           Leasehold, and the Lessee shall be responsible for
                           all its undertakings pursuant to this Agreement as if
                           no additional lessee had been included in the
                           Leasehold.

                           Notwithstanding the foregoing, the Lessee may lease
                           the Second-Floor Leasehold by a sub-lease to a lessee
                           as agreed in coordination and consultation with the
                           Lessor. The Lessor shall not unreasonably withhold
                           its approval.

         8.3      Denial of the applicability of tenants' protection laws

                  The Lessee hereby declares that it is aware that the Leasehold
                  and the Building wherein it is situated are a new leasehold
                  and building built after 1968, so that on the date of
                  commencing of the Tenant's Protection Law (Various Provisions)
                  5728-1968 there was no tenant in the Leasehold entitled to
                  have possession therein, that no key money whatsoever has been
                  paid or received with respect to the Leasehold or the lease
                  relationship created hereunder, nor any other consideration
                  whatsoever other than the Rent, and hence the provisions of
                  the Tenant's Protection Law (Combined Version), 5732-1872 or
                  any other law superseding same, or any other law designated or
                  to be designated to protect

<PAGE>

                                       23

                  tenants, shall not apply to this Agreement nor to the lease
                  hereunder, and in no event shall the Lessee be deemed as a
                  protected tenant, nor shall it be entitled to payment of any
                  key money or other payment upon vacating the Leasehold, and it
                  shall have to vacate the Leasehold on the date of vacation
                  and return same to the Lessor, it being free of any person and
                  chattel placed or installed by it in the Leasehold.

         8.4      SURETIES

                  8.4.1    As surety to secure all the Lessee's undertakings
                           pursuant to this Agreement,  including, without
                          derogating from the Lessee's other undertakings,
                           vacating the Leasehold on time, payment for any
                           damage caused to the Leasehold, payment of the Rent
                           and the payments applicable to the Lessee pursuant
                           to this Agreement, the Lessee shall furnish to the
                           Lessor, no later than 7 days as of the signature
                           hereof, an autonomous independent bank guarantee,
                           index linked, in the amount of NIS 402,756 (three
                           month Rent for the Leasehold) (in NIS, linked to the
                           Consumer Price Index) in effect for one year as of
                           the date of issuance thereof, and same shall be
                           extended on a yearly basis by 60 days following the
                           end of the Original Term of Lease and/or the Option,
                           as the case may be. The guarantee shall be returned
                           to the Lessee upon vacating the Leasehold and
                           settling all its undertakings pursuant to this
                           Agreement, including presentation of receipts with
                           respect to payment of municipal property tax and
                           payment to the maintenance company.

                  8.4.2    If the Lessee  breaches any of its  undertakings
                           pursuant to this  Agreement,  without  derogating
                           from the generality of the definition,  and in
                           particular should it fail to timely make any payment
                           applicable to it hereunder,  and/or  should it fail
                           to  timely  vacate  the  Leasehold,  and/or  if it
                           causes  damage to the Leasehold,  the  Lessor  may
                           exercise

<PAGE>
                                       24

                           the  guarantee  and use the funds for rectifying  the
                           breach and as compensation  for such breach,
                           provided it warns the Lessee that it is about to
                           exercise the  guarantees at least 14 days in advance.
                           The  balance,  if any,  shall be  returned to the
                           Lessee only after it actually vacates  the Leasehold,
                           being  linked to the  Consumer's  Price Index as of
                           the date of  exercise  of the guarantee up to the
                           date of returning the balance.

9.       BREACHES AND RELIEF

         9.1      In the event that the Lessee fails to make any of the payments
                  applicable  to it  hereunder in timely  fashion,  the
                  following provisions shall apply:

                  9.1.1    Any amount payable by the Lessee to the Lessor and/or
                           to the management company hereunder which has not
                           been settled on time, shall bear arrears interest at
                           the maximum rate then charged by Bank Leumi Le'Israel
                           Ltd. with respect to unauthorized deviations, as of
                           the date of payment herein set forth up to the actual
                           date thereof with the addition of VAT at law.

                  9.1.2    In the event that the Lessee fails to fulfill any of
                           its undertakings pursuant to this Agreement,
                           including payments to any person, the Lessor and/or
                           the management company, may, however are not
                           obligated to, after giving prior notice to the
                           Lessee, effect any payment and/or undertaking as
                           aforesaid at their discretion, and charge the linkage
                           as of the date of effecting the payment, pending
                           receipt of the actual refund with the addition of 10%
                           (ten percent) handling fees.

         9.2      Without derogating from the provisions of sub-clause 9.1
                  above, in the event that the Lessee breaches this Agreement
                  and fails to rectify such breach within 14 days as of receipt
                  of the Lessor's

<PAGE>

                                       25

                  notice, the Lessor and/or the management company shall be
                  entitled to all or any part of the relief, at their exclusive
                  discretion, as the case may be, as follows:

                  The Lessee shall pay the Lessor on the date of vacating or of
                  failing to hand over the Leasehold, as the case may be, in
                  addition to any damage caused to it, pre-estimated agreed
                  compensation at the rate of 3 months Rent hereunder, or the
                  last Rent actually paid by the Lessee to the Lessor prior to
                  the breach, whichever is latest, together with Linkage
                  Differences up to the actual date of vacating.

         9.3      The relief granted to the Lessor and/or the management company
                  as set forth in sub-clause 9.2 above, shall also apply in the
                  following occurrences:

                  9.3.1    If bankruptcy or liquidation  proceedings are
                           instituted  against the Lessee and are not cancelled
                           within 30 days.

                  9.3.2    If a receiver is appointed for the Lessee and/or its
                           property and such appointment is not cancelled within
                           30 days.

         9.4      Without derogating from any of the Lessor's rights and without
                  derogating from the provisions of sub-clauses 9.1, 9.2 and 9.3
                  above, in the event that the Lessee fails to vacate the
                  Leasehold at the end of the Term of Lease or on the date set
                  forth in sub-clause 9.2.1 above, the following provisions
                  shall apply:

         9.4.1    The Lessee shall pay appropriate usage fees at the rate of 3
                  (three) month's Rent for each month of delay in vacating. Such
                  payment shall be effected on the last day of each month of
                  delay in vacating for the preceding month.

         9.4.2    The Lessee shall pay all the amounts, payments and taxes
                  applicable to it hereunder, including management fees.

<PAGE>

                                       26

         9.4.3    The payment set forth in this clause shall not create a lease
                  relationship between the Lessee and the Lessor with respect to
                  the period following termination of the Term of Lease or
                  vacating the Leasehold as herein set forth.

         9.4.4    To remove any doubts it is hereby expressly declared that
                  nothing stated in this clause shall be deemed as a waiver of
                  the Lessor's rights, or consent that the Lessee shall be in
                  delay of vacating the Leasehold. Failure to vacate the
                  Leasehold on the date of vacating shall be deemed as a
                  fundamental breach of this Agreement, and the Lessor may
                  enforce such vacating in any manner available to it under law.

10.      OFFSET

         10.1     The Lessor and/or the management company may offset any amount
                  payable to either of them by the Lessee hereunder, and/or any
                  amount necessary for the performance of the Lessee's
                  undertakings pursuant to this Agreement, from any amount
                  payable to the Lessee and/or available to it in the account of
                  either of them.

         10.2     The Lessee may not offset any amounts from its payments to the
                  Lessor and/or the management company.

         10.3     Any claim of whatever nature on the part of the Lessee against
                  the  management  company shall not constitute a cause of
                  action on its part against the Lessor.

11.      MISCELLANEOUS

         11.1     There shall be no effect to any waiver, acquittal or extension
                  granted or made by either party unless given and made
                  expressly and in writing, and no waiver, acquittal or
                  extension with respect to any breach of this Agreement may be
                  interpreted or deduced from the mere action or omission which
                  is not an express written

<PAGE>

                                       27

                  notice. Delay or failure to utilize any right by any of the
                  parties hereunder shall in no event and under no circumstances
                  be deemed as waiver or a basis for estoppel against them by
                  any of the parties.

         11.2     This Agreement  cancels any prior  agreement  between the
                  parties  whether  granted,  made or concluded  orally or in
                  writing.

         11.3     The Tel-Aviv courts shall have exclusive jurisdiction to hear
                  any matter pertaining to this Agreement and/or arising
                  herefrom including the implementation, breach or cancellation
                  hereof.

         11.4     Any payment and/or any of the Lessee's undertakings shall be
                  made and/or granted, unless otherwise expressly stated herein,
                  at the Lessor's offices as stated in the preamble hereto.

         11.5     Any notice pursuant to this Agreement shall only be made in
                  writing and sent to the parties in accordance to the addresses
                  stated in the preamble hereto or at the address respecting
                  which the Lessee gave notice to the Lessor in writing
                  following the signature hereof, or at the Leasehold.

                  Any notice from one party to the other shall be sent by
                  registered mail and shall be deemed to have been delivered to
                  its destination within 72 (seventy two) hours from its
                  dispatch for delivery by registered mail at a post office in
                  Israel being properly addressed.

                   IN WITNESS WHEREOF THE PARTIES HAVE SIGNED:<PAGE>
                                                                   EXHIBIT 10.12

                                 2900 LAKESIDE
                             OFFICE BUILDING LEASE

                                 BY AND BETWEEN

                         PRINCETON INVESTMENT GROUP LLC

                                 ("LANDLORD")

                                      AND

                            XACCT TECHNOLOGIES, INC.
                             A DELAWARE CORPORATION

                                   ("TENANT")

November 12, 1999

<PAGE>

                              TABLE OF CONTENTS
                              -----------------
ARTICLE                                                      PAGE
-------                                                      ----

1.  TERM                                                  1
2.  POSSESSION                                            1
3.  BASIC RENT                                            1
4.  RENTAL ADJUSTMENT                                     2
5.  SECURITY DEPOSIT                                      3
6.  USE                                                   4
7.  NOTICES                                               5
8.  BROKERS                                               6
9.  HOLDING OVER                                          6
10. TAXES ON TENANT'S PROPERTY                            6
11. CONDITION OF PREMISES                                 6
12. ALTERATIONS                                           7
13. REPAIRS                                               7
14. LIENS                                                 7
15. ENTRY BY LANDLORD                                     8
16. UTILITIES AND SERVICES                                8
17. BANKRUPTCY                                            8
18. INDEMNIFICATION                                       9
19. DAMAGE TO TENANT'S PROPERTY                           9
20. TENANT'S INSURANCE                                    9
21. DAMAGE OR DESTRUCTION                                10
22. EMINENT DOMAIN                                       11
23. DEFAULTS AND REMEDIES                                11
24. ASSIGNMENT AND SUBLETTING                            13
25. SUBORDINATION                                        14
26. ESTOPPEL CERTIFICATE                                 14
27. SIGNAGE                                              14
28. RULES AND REGULATIONS                                14
29. CONFLICT OF LAW                                      15
30. SUCCESSORS AND ASSIGNS                               15
31. SURRENDER OF PREMISES                                15
32. ATTORNEYS' FEES                                      15
33. PERFORMANCE BY TENANT                                15
34  MORTGAGEE PROTECTION                                 15
35. DEFINITION OF LANDLORD                               15
36. WAIVER                                               16
37. IDENTIFICATION OF TENANT                             16

<PAGE>

                               TABLE OF CONTENTS
                               -----------------
ARTICLE                                                  PAGE
-------                                                  ----

38. PARKING                                              16
39. TERMS AND HEADINGS                                   16
40. FINANCIAL STATEMENTS                                 16
41. TIME                                                 16
42. PRIOR AGREEMENT; AMENDMENTS                          17
43. SEPARABILITY                                         17
44. RECORDING                                            17
45. CONSENTS                                             17
46. LIMITATION OF LIABILITY                              17
47. RIDERS                                               17
48  EXHIBITS                                             17
49. MODIFICATION FOR LENDER                              18
50. OPTION TO EXTEND                                     18

<PAGE>

                               TABLE OF EXHIBITS
                               -----------------

EXHIBIT A           THE PREMISES

EXHIBIT B           WORK LETTER AGREEMENT

EXHIBIT C           STANDARDS FOR UTILITIES AND SERVICES

EXHIBIT D           RULES AND REGULATIONS

EXHIBIT E           PARKING RULES AND REGULATIONS

<PAGE>

                             OFFICE BUILDING LEASE

     THIS LEASE is made as of November 12, 1999 by and between Princeton
Investment Group LLC ("Landlord"), and XACCT Technologies, Inc., a Delaware
Corporation, ("Tenant").

     Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
Suite Number 100 (the "Premises") outlined on the floor plan attached hereto and
marked Exhibit A, the Premises being agreed, for the purposes of this Lease, to
have an area of approximately 10,970 rentable square feet and being situated on
the First floor of that certain office building located at 2900 Lakeside Drive,
Santa Clara, California, 95054 (the "Building").

     The parties hereto agree that said letting and hiring is upon and subject
to the terms, covenants and conditions herein set forth. Tenant covenants, as a
material part of the consideration for this Lease to keep and perform each and
all of said terms, covenants and conditions for which Tenant is liable and that
this Lease is made upon the condition of such performance.

     Prior to the commencing of the term of this Lease the Premises shall be
improved by the Tenant Improvements described in the Work Letter marked Exhibit
B attached hereto.

                                    1. TERM

     The term of this Lease shall be for Sixty (60) months commencing January
1, 2000 or upon the substantial completion of tenant improvements as described
in EXHIBIT B, and ending on the last day of the month immediately preceding the
month in which the anniversary of the commencement date occurs, unless such term
shall be sooner terminated as hereinafter provided.

     As soon as the commencement date is determined, the parties shall enter
into an amendment of this Lease setting forth the precise commencement and
termination dates of this Lease. Failure to enter into such an amendment,
however, shall not affect Tenant's liability hereunder for the term of the
Lease. Reference in this Lease to a "Lease Year" shall mean each successive
twelve-month period commencing with the commencement date.

                                 2. POSSESSION

     Tenant agrees that, if Landlord is unable to deliver possession of the
Premises to Tenant on the scheduled commencement of the term of this Lease, this
Lease shall not be void or voidable, nor shall Landlord be liable to Tenant for
any loss or damage resulting therefrom, but in such event the term of this Lease
shall not commence until Landlord tenders possession of the Premises to Tenant
with the Tenant Improvements substantially completed. If Landlord completes
construction of the Tenant Improvements prior to the date scheduled in the Work
Letter, Landlord shall deliver possession of the Premises to Tenant upon such
completion and the term of this Lease shall thereupon commence. Tenant shall
have the right to access the Premises from the date of execution of this Lease
until the Commencement Date for the purpose of installing furniture, trade
fixtures and equipment, and data and communication systems. Tenant shall not
conduct its business from the Premises during this early access period. Such
early occupancy shall be subject to all of the provisions of this Lease,
excluding the commencement of Rent. The preceding notwithstanding, Tenant may
terminate Lease if Landlord is unable to deliver possession of the Premises on
or before February 29, 2000.

                                 3. BASIC RENT

     (a) Tenant agrees to pay Landlord Basic Rent for the Premises (subject to
adjustments as hereinafter provided) as follows:

MONTHS OF TERM                     MONTHLY BASIC RENT
--------------                     ------------------

01 -12                             $30,168 PER MONTH
13- 24                             $31,265 PER MONTH
25 -36                             $32,362 PER MONTH
37 -48                             $33,459 PER MONTH
49 -60                             $34,556 PER MONTH

                                       1

<PAGE>

     The Basic Rent shall be paid monthly, in advance on the fist (1st) day
of each calendar month during the term, except that the fIrst month's rent shall
be paid on execution hereof. If Tenant's obligation to pay rent commences or
ends on a day other than the first day of a calendar month, then the rental for
such period shall be prorated in the proportion that the number of days this
Lease is in effect during such period bears to number of days in such month. In
addition to the Basic Rent, Tenant agrees to pay as additional rental the amount
of rental adjustments and other charges required by this Lease. All rental shall
be paid to Landlord, without prior demand and without any deduction or offset,
in lawful money of the United States of America, at the address of Landlord
designated on the signature page of this Lease or to such other person or at
such other place as Landlord may from time to time designate in writing.

     (b) In the event Tenant fails to pay any installment of rent when due or in
the event Tenant fails to make any other payment of which Tenant is obligated
under this Lease when due, then Tenant shall pay to Landlord a LATE CHARGE
EQUAL TO TEN PERCENT(10 %)MONTHLY of the amount due to compensate Landlord for
the extra costs incurred as a result of such late payment. If any rent or other
payment remains delinquent for a period in excess of 14 days then, in addition
to such late charge, Tenant shall pay to Landlord interest on such rent or other
payment at the maximum rate permitted by law from the date such rent or other
payment became due until paid.

                             4. RENTAL ADJUSTMENT

     (a) For the purpose of this Article 4, the following terms are defined as
follows:

          (i)  TENANT'S PERCENTAGE. That portion of the Building occupied by
Tenant divided by the total square footage of the Building, which result is
the following 33.08%.

          (ii) DIRECT EXPENSES BASE. The amount of the annual Direct
Expenses which Landlord has included in Basic Rent, which amount is the Direct
Expenses incurred for calendar year 2000 actual Direct Expenses.

          (iii)DIRECT EXPENSES. The term "Direct Expenses" shall include:

               (A) All real and personal property taxes and assessments imposed
by any governmental authority or agency on the Building and the land on which
the Building is located (including a pro rata portion of any taxes levied on any
common areas); any assessments levied in lieu of taxes; any non-progressive tax
on or measured by gross rentals received from the rental of space in the
Building; and any other costs levied or assessed by, or at the direction of, any
federal, state, or local government authority in connection with the use or
occupancy of the Premises or the parking facilities serving the Premises; any
tax on this transaction or any document to which Tenant is a party creating or
transferring an interest in the Premises, and any expenses, including cost of
attorneys or experts, reasonably incurred by Landlord in seeking reduction by
the taxing authority of the above-referenced taxes, less tax refunds obtained as
a result of an application for review thereof; but shall not include any net
income, franchise, capital stock, estate or inheritance taxes.

               (B) Operating costs consisting of costs incurred by Landlord in
maintaining and operating the Building, exclusive of costs required to be
capitalized for federal income tax purposes, and including (without limiting the
generality of the foregoing) the following: costs of utilities, supplies and
insurance, costs of services of independent contractors, managers and other
suppliers, the fair rental value of the Building office, costs of compensation
(including employment taxes and fringe benefits) of all persons who perform
regular and recurring duties connected with the management, operation,
maintenance, and repair of the Building, its equipment, parking facilities and
the common areas, including, without limitation, engineers, janitors, foremen,
floor waxers, window washers, watchmen and gardeners, but excluding persons
performing services not uniformly available to or performed for substantially
all Building tenants; a reasonable management fee; cost of maintaining,
repairing and replacing landscaping, sprinkler systems, concrete walkways, paved
parking areas, signs, and site lighting.

               (C) Amortization of such capital improvements as Landlord may
have installed: (a) for the purpose of reducing operating costs, (b) to comply
with governmental rules and regulations promulgated after completion of the
Building, and (c) for the purpose of replacing existing capital items and
improvements, provided that such cost together with interest at the maximum rate
allowed by law shall be amortized over such reasonable period as

                                       2
<PAGE>

Landlord shall determine, and only the monthly amortized cost shall be included
in Direct Expenses.

     (b) If Tenant's Percentage of the Direct Expenses paid or incurred by
Landlord for any calendar year after the first calendar year exceeds the Direct
Expenses Base included in Tenant's rent, then Tenant shall pay such excess as
additional rent. Accordingly, for each year after the first calendar year, or
portion thereof, Tenant shall pay Tenant's Percentage of Landlord's estimate of
the amount by which Direct Expenses for that year shall exceed the Direct
Expenses Base ("Landlord Estimate"). This estimated amount shall be divided into
twelve equal monthly installments. Tenant shall pay to Landlord, concurrently
with the regular monthly rent payment next due following the receipt of such
statement, an amount equal to one monthly installment multiplied by the number
of months from January in the calendar year in which said statement is submitted
to the month of such payment, both months inclusive. Subsequent installments
shall be payable concurrently with the regular monthly rent payments for the
balance of that calendar year and shall continue until the next calendar year's
statement is rendered. As soon as possible after the end of each calendar year,
Landlord shall provide Tenant with a statement showing the amount of Tenant's
Percentage of Direct Expenses, the amount of Landlord's Estimate actually paid
by Tenant and the amount of the Direct Expenses Base. Thereafter, Landlord shall
reconcile the above amounts and shall either bill Tenant for the balance due
(payable on demand by Landlord) or credit any over payment by Tenant towards the
next monthly installment of Landlord's Estimate falling due, as the case may be.
For purposes of making these calculations, in no event shall Tenant's Percentage
of the Direct Expenses be deemed to be less than the Direct Expenses Base.

     (c) Even though the term has expired and Tenant has vacated the Premises,
when the final determination is made of Tenant's Percentage of Direct Expenses
for the year in which this Lease terminates, Tenant shall immediately pay any
increase due over the estimated expenses paid and, conversely, any over payment
made in the event said expenses decrease shall be rebated by Landlord to Tenant.

          5. SECURITY DEPOSIT AND ADDITIONAL DEPOSIT (LETTER OF CREDIT)

     (a)  Tenant shall deposit with Landlord, upon execution of this Lease, the
          sum of Thirty four thousand and five hundred fifty six Dollars and
          no/lOOths ($34,556.00). Said sum shall be held by Landlord as security
          for the faithful performance by Tenant of all of Tenant's obligations
          hereunder. If Tenant defaults with respect to any provision of this
          Lease, including but not limited to the provisions relating to the
          payment of rent, Landlord may (but shall not be required to) use,
          apply or retain all or any part of this security deposit for the
          payment of any rent or any other sum in default, or for the payment of
          any other amount which Landlord may spend or become obligated to spend
          by reason of Tenant's default or to compensate Landlord for any other
          loss or damage which Landlord may suffer by reason of Tenant's
          default. If any portion of the deposit is so used or applied, Tenant
          shall, upon demand, deposit cash with Landlord in an amount sufficient
          to restore the security deposit to its original amount. Tenant's
          failure to do so shall be a material breach of this Lease. Landlord
          shall not be required to keep this security deposit separate from its
          general funds. If Tenant shall fully and faithfully perform all of its
          obligations under this Lease, the security deposit or any balance
          thereof shall be returned to Tenant (or , at Landlord's option, to the
          last assignee of Tenant's interest hereunder) at the expiration of the
          Lease term, provided that Landlord may retain the security deposit
          until such time as any amount due from Tenant in accordance with
          Article 4 hereof has been determined and paid in full.

     (b)  Letter of Credit in the amount of $300,000.00

          1.   Delivery of Letter of Credit. Tenant shall on execution of this
               Lease, deliver to Landlord and cause to be in effect during the
               Lease Term an unconditional, irrevocable letter of credit ("LOC")
               in the amount of$300,000.00. The LOC shall be in a form
               acceptable to Landlord and shall be issued by an LOC bank
               selected by Tenant and acceptable to Landlord. An LOC bank is a
               bank that accepts deposits, maintains account, has a local office
               that will negotiate a letter of credit and the deposits of which
               are insured by the Federal Deposit Insurance Corporation. Tenant
               shall pay all expenses, points, or fees incurred by Tenant in
               obtaining the LOC. The LOC shall not be mortgaged, assigned or
               encumbered in any manner whatsoever by Tenant without the prior
               written consent of Landlord. Tenant acknowledges that Landlord
               has the right

                                       3

<PAGE>

               to transfer or mortgage its interest in the Project, the Building
               and in this Lease. And Tenant agrees that in the event of any
               such transfer or mortgage Landlord shall have the right to
               transfer or assign the LOC and/or the LOC Security Deposit (as
               defined below) to the transferee or mortgagee, and in the event
               of such transfer, Tenant shall look solely to such transferee or
               mortgagee for the return of the LOC.

          2.   Replacement of Letter of Credit: Tenant may, from time to time,
               replace any existing LOC with a new LOC if the new LOC (a)
               becomes effective at least thirty (30) days before expiration of
               the LOC that it replaces, (b) is in the required LOC amount;
               (c) is issued by an LOC bank acceptable to Landlord; and (d)
               otherwise complies with the requirements of the Paragraph 5(b)

          3.   Landlord's Right to Draw on Letter of Credit. Landlord shall hold
               the LOC as additional security for the performance of Tenant's
               obligations under this Lease. If, after notice and failure to
               cure within any applicable period provided in this Lease, Tenant
               defaults on any provision of this Lease, Landlord may without
               prejudice to any other remedy it has, draw on that portion of the
               LOC necessary to (a) pay Rent or other sum in default; (b) payor
               reimburse Landlord for any amount that Landlord may spend or
               become obligated to spend in exercising Landlord's right under
               Paragraph 23 (Defaults and Remedies); and/or (c) compensate
               Landlord for any expense, loss or damage that Landlord may suffer
               because of Tenant's default. If Tenant fails to renew or replace
               the LOC at least thirty (30) days before its expiration, Landlord
               may, without prejudice to any other remedy it has, draw on the
               entire amount of the LOC.

          4.   LOC Security Deposit. Any amount of the LOC that is drawn on by
               Landlord but not applied by Landlord shall be held by Landlord as
               security deposit (the LOC Security Deposit") in accordance with
               Paragraph 5 of this Lease.

          5.   Restoration of Letter of Credit and LOC Security Deposit. If
               Landlord draws on any portion of the LOC and/or applies all or
               any portion of such draw, Tenant shall, within five (5) business
               days after demand by Landlord, either (a) deposit cash with
               Landlord in an amount that, when added to the amount remaining
               under the LOC and the amount of any LOC Security Deposit, shall
               equal the LOC Amount then required under this Paragraph 5(b ); or
               (b) reinstate the LOC to the full LOC Amount.

          6.   Reduction in Letter of Credit. At any time after the third
               anniversary of the Lease, and only in the event Tenant satisfies
               each of the following conditions to Landlord's reasonable
               satisfaction, the LOC Amount may be reduced to an amount equal to
               One Hundred Fifty Thousand and no/100 Dollars ($150,000.00).: (i)
               Tenant is not and has not been in default under the terms of this
               Lease beyond any applicable cure period; (ii) Tenant shall
               deliver to Landlord for review Tenant's financial statements
               prepared in accordance with generally accepted accounting
               principles and audited by a nationally recognized public
               accounting firm acceptable to Landlord, and any other financial
               information reasonably requested by Landlord ("Tenant's
               Financial Information"); and (iii) Tenant provides to Landlord
               ten (10) days prior written notice of any such deduction; and
               (iv) the LOC provides that the issuing bank shall notify Landlord
               in writing i at least five (5) business days prior to any such
               reduction. In the event that such reduction to the LOC is made
               and, subsequently, Tenant fails to meet any of the above
               conditions for a period of (thirty (30) days following delivery
               by Landlord of written notice of any such failure. Tenant shall
               within forty-eight (48) hours, increase the face amount of the
               LOC to an amount equal to $300,000.00.

                                     6. USE

     (a) Tenant shall use the Premises for general offices, including software
engineering development and support, marketing, and shall not use or permit
the Premises to be used for any other purpose without the prior written

                                       4

<PAGE>

consent of Landlord. Nothing contained herein shall be deemed to give Tenant any
exclusive right to such use in the Building. Tenant shall not use or occupy
the Premises in violation of law or the certificate of occupancy issued for the
Building, and shall, upon written notice from Landlord, discontinue any use of
the Premises which is declared by any! governmental authority having
jurisdiction to be a violation of law or of the certificate of occupancy. Tenant
shall comply with any direction of any governmental authority having
jurisdiction which. shall, by reason of the nature of Tenants use or
occupancy of the Premises, pose a duty upon Tenant or Landlord With respect to
the Premises or with respect to the use or occupation thereof. Tenant shall not
do or permit to be done anything which will invalidate or increase the cost of
any fire, extended coverage or any other insurance policy covering the Building
and/or property is located therein and shall comply with all rules, orders,
regulations and requirements of the Insurance Service Offices, formerly known as
the Pacific Fire Rating Bureau or any other organization performing a similar
function. Tenant shall promptly, upon demand, reimburse Landlord for any
additional premium charged for such policy by reason of Tenant's failure to
comply with the provisions of this article. Tenant shall not do or permit
anything to be done in or about the Premises which will in any way obstruct or
interfere with the rights of other tenants of the Building, or injure or annoy
them, or use or allow the Premises to be used for any improper, immoral,
unlawful or objectionable purpose, nor shall  Tenant cause, maintain or permit
any nuisances in, on or about the Premises. Tenant shall not commit or suffer to
be committed any waste in or upon the Premises.

     (b) Tenant shall not use, store or dispose of any hazardous, toxic or
radioactive materials or substances, including those materials identified as
hazardous pursuant to Article II of Title 22 of the California Code of
Regulations, Division 4, Chapter 20, as they may be amended from time to time
("Hazardous Materials"), in, on or about the Premises or the Building without
the prior written co sent of Landlord. If Landlord consents to Tenant's use of
any Hazardous Materials in or on the Premises, Tenant shall comply with all
applicable federal state and local laws, statutes, ordinances, rules and
regulations relating to the use, storage and disposal of Hazardous Materials.

                                  7. NOTICES

     Any notice required or permitted hereunder must be in writing and may be
given by personal delivery, overnight courier service, or by mail, and given
by mail shall be deemed sufficiently given if sent by registered or certified
mail addressed to Tenant at the Premises, or to Landlord at its address set
forth at the end of this Lease. Either party may specify a different address
for notice purposes by written notice to the other except that the Landlord may
in any event use the Premises as Tenant's address for notice purposes.

ADDRESS TO MAIL RENT STATEMENT TO:    PRINCETON INVESTMENT GROUP
                                      P.0. BOX 22196,
                                      SAN FRANCISCO, CA 94122
                                      ATTN: FRANCES LIM
                                      CHIEF EXECUTIVE OFFICER

ADDRESS TO MAIL NOTICES STATEMENT TO: PRINCETON INVESTMENT GROUP LLC
                                      C/O HYCD, INC.
                                      5300 STEVENS CREEK BLVD. SUITE 450
                                      SAN JOSE, CA 95129
                                      ATTN: DIANE LING
                                      CHIEF EXECUTIVE OFFICER

                                      AND

PRINCETON INVESTMENT GROUP            P.0. BOX 22196,
                                      SAN FRANCISCO, CA 94122
                                      ATTN: FRANCES LIM
                                      CHIEF EXECUTIVE OFFICER

                                       5
<PAGE>

                                   8. BROKERS

     Tenant warrants that it has had no dealings with any real estate broker or
agent in connection with the negotiation of the Lease, except CB Richard Ellis
and David Marley Associates whose commissions shall be payable by Landlord in
accordance with Landlord's standard commission schedule, and that it knows of no
other real estate, broker or agent who is or might be entitled to a commission
in connection with this Lease. If Tenant has dealt with any other person or real
estate broker with respect to leasing or renting space in the Building, Tenant
shall be solely responsible for the payment of any fee due said person or firm
and Tenant shall hold Landlord free and harmless against any liability in
respect thereto, including attorneys' fees and costs.

                                9. HOLDING OVER

     If Tenant holds over after the expiration or earlier termination of the
term hereof without the express written consent of Landlord, Tenant shall
become a Tenant at sufferance only, at a rental rate equal to one hundred fifty
percent (150%) of the rent in effect upon the date of such expiration (subject
to adjustment as provided in paragraph 4 hereof and prorated on a daily basis),
and otherwise subject to the terms, covenants and conditions herein specified,
so far as applicable. Acceptance by Landlord of rent after such expiration or
earlier termination shall not result in a renewal of this Lease. The foregoing
provisions of this Article 9 are in addition to and do not affect Landlord's
right of reentry or any rights of Landlord hereunder or as otherwise provided by
law. If Tenant fails to surrender the Premises upon the expiration of this Lease
despite demand to do so by Landlord, Tenant shall indemnify and hold Landlord
harmless from all loss or liability, including without limitation, any claim
made by any succeeding tenant founded upon or resulting from such failure to
surrender, and any attorneys' fees and costs.

                         10. TAXES ON TENANT'S PROPERTY

     (a) Tenant shall be liable for and shall pay, at least ten days before
delinquency, all taxes levied against any personal property or trade fixtures
placed by Tenant in or about the Premises. If any such taxes on Tenant's
personal property or trade fixtures are levied against Landlord or Landlord's
property or if the assessed value of the Premises is increased by the inclusion
therein of a value placed upon such personal property or trade fixtures of
Tenant and if Landlord, after written notice to Tenant, pays the taxes based
upon such increased assessment, which Landlord shall have the right to do
regardless of the validity thereof, but only under proper protest if requested
by Tenant, Tenant shall, upon demand, repay to Landlord the taxes so levied
against Landlord, or the portion of such taxes resulting from such increase in
the assessment.

     (b) If the Tenant Improvements in the Premises, whether installed, and/or
paid for by Landlord or Tenant and whether or not affixed to the real property
so as to become a part thereof, are assessed for real property tax purposes at a
valuation higher than the valuation at which Tenant Improvements conforming to
Landlord's "Building Standard" in other space in the Building are assessed, then
the real property taxes and assessments levied against the Building by reason of
such excess assessed valuation shall be deemed to be taxes levied against
personal property of Tenant and shall be governed by the provisions of Paragraph
10(a), above. If the records of the county assessor are available and
sufficiently detailed to serve as a basis for determining whether said Tenant
Improvements are assessed at a higher valuation than Landlord's Building
Standard, such records shall be binding on both the Landlord and the Tenant. If
the records of the county assessor are not available or sufficiently detailed to
serve as a basis for making said determination, the actual cost of construction
shall be used.

                           11. CONDITION OF PREMISES

     Tenant acknowledges that neither Landlord nor any agent of Landlord has
made any representation or warranty with respect to the Premises or the Building
or with respect to the suitability of either for the conduct of Tenant's
business. The taking of possession of the Premises by Tenant shall conclusively
establish that the Premises and the Building were in satisfactory condition at
such time. The preceding notwithstanding, Landlord represents that all Building
Systems shall be in good order and operating condition at the commencement of
the Lease.
                                       6

<PAGE>

                                12. ALTERATIONS

     (a) Tenant shall make no alterations, additions or improvements in or to
the Premises without Landlord's prior written consent, and then only by
contractors or mechanics approved by Landlord. Tenant agrees that there shall be
no construction of partitions or other obstruction which might interfere with
Landlord's free access to mechanical installations or service facilities of the
Building or interfere with the moving of Landlord's equipment to or from the
enclosures containing said installations or facilities. All such work shall be
done at such times and in such manner as Landlord may from time to time
designate. Tenant covenants and agrees that all work done by Tenant shall be
performed in full compliance with all laws, rules, orders, ordinances,
regulations and requirements of all governmental agencies, offices, and boards
having jurisdiction, and in full compliance with the rules, regulations and
requirements of the Insurance Service Offices formerly known as the Pacific Fire
Rating Bureau, and of any similar body. Before commencing any work, Tenant shall
give Landlord at least ten (10) days written notice of the proposed commencement
of such work and shall, if required by Landlord, secure at Tenant's own cost and
expense, a completion and lien indemnity bond, satisfactory to Landlord, for
said work. Tenant further covenants and agrees that any mechanic's lien filed
against the Premises or against the Building for work claimed to have been done
for, or materials claimed to have been furnished to, Tenant will be discharged
by Tenant, by bond or otherwise, within ten (10) days after the filing thereof,
at the cost and expense of Tenant. All alterations, additions or improvements
upon the Premises made by either party, including (without limiting the
generality of the foregoing) all wall covering, built-in cabinet work, paneling
and the like, shall, unless Landlord elects otherwise, become the property of
Landlord, and shall remain upon, and be surrendered with the Premises, as a part
thereof, at the end of the term hereof, except that Landlord may, by written
notice to Tenant, require Tenant to remove all partitions, counters, railings
and the like installed by Tenant, and Tenant shall repair all damage resulting
from such removal or, at Landlord's option, shall pay to Landlord all costs
arising from such removal.

     (b) All articles of personal property and all business and trade fixtures,
machinery and equipment, furniture and movable partitions owned by Tenant or
installed by Tenant at its expense in the Premises shall be and remain the
property of Tenant and may be removed by Tenant at any time during the lease
term when Tenant is not in default hereunder. If Tenant shall fail to remove all
of its effects from the Premises upon termination of this Lease for any cause
whatsoever, Landlord may, at its option, remove the same in any manner that
Landlord shall choose, and store said effects without liability to Tenant for
loss thereof. In such event, Tenant agrees to pay Landlord upon demand any and
all expenses incurred in such removal, including court costs and attorneys' fees
and storage charges at its option, without notice, sell said effects, or any of
the same, at private sale and without legal process, for such price as Landlord
may obtain and apply the proceeds of such sale upon any amounts due under this
Lease from Tenant to Landlord and upon the expense incident to the removal and
sale of said effects.

                                  13. REPAIRS

     (a) By entry hereunder, Tenant accepts the Premises as being in good and
sanitary order, condition and repair. Tenant shall keep, maintain and preserve
the Premises in first class condition and repair, and shall, when and if needed,
at Tenant's sole cost and expense, make all repairs to the Premises and every
part thereof. Tenant shall, upon the expiration or sooner termination of the
term hereof, surrender the Premises to Landlord in the same condition as when
received, usual and ordinary wear and tear excepted. Landlord shall have no
obligation to alter, remodel, improve, repair, decorate, or paint the Premises
or any part thereof. The parties hereto affirm that Landlord has made no
representations to Tenant respecting the condition of the Premises or the
Building except as specifically herein set forth.

     (b) Anything contained in Paragraph 13(a) above to the contrary
notwithstanding, Landlord shall repair and maintain the structural portions of
the Building, including the foundation, building shell, and roof structure, all
at Landlord's expense, unless such maintenance and repairs are caused in part or
in whole by the act, neglect, or omission of any duty of Tenant, its agents,
employees, or invitees, in which event Tenant shall reimburse Landlord, as
additional rent, for the reasonable cost of such maintenance and repairs.
Landlord shall also repair and maintain the basic plumbing, elevators, life
safety systems and other building systems, heating, ventilating, air
conditioning and electrical systems installed or furnished by Landlord, the
roof membrane, the parking areas, driveways, sidewalks, landscaping, project
signs and exterior site lighting. The cost of the foregoing repairs and
maintenance shall be billed to Tenant as operating costs pursuant to Paragraph
4. Landlord shall not be liable for any failure to make any such repairs or to
perform any maintenance unless such failure shall persist for an unreasonable
time after written notice of the need of

                                       7

<PAGE>

such repairs or maintenance is given to Landlord by Tenant. Except as provided
in Article 21 hereof, there shall be no abatement of rent and no liability of
Landlord by reason of any injury to or interference with Tenant's business
arising from the making of any repairs, alterations or improvements in or to any
portion of the Building or the Premises or in or to fixtures, appurtenances and
equipment therein. Tenant waives the right to make repairs at Landlord's expense
under any law, statute or ordinance now or hereafter in effect.

                                   14. LIENS

     Tenant shall not permit any mechanics, materialmen's or other liens to be
filed against the Building nor against Tenant's leasehold interest in the
Premises. Landlord shall have the right at all reasonable times to post and keep
posted on the Premises any notices, which it deems necessary for protection from
such liens. If any such liens are filed, Landlord may, without waiving its
rights and remedies based on such breach of Tenant and without releasing Tenant
from any of its obligations, cause such liens to be released by any means it
shall deem proper, including payments in satisfaction of the claim giving rise
to such lien. Tenant shall pay to Landlord at once, upon notice by Landlord, any
sum paid by Landlord to remove such liens, together with interest at the maximum
rate per annum permitted by law from the date of such payment by Landlord.

                             15. ENTRY BY LANDLORD

     Landlord reserves and shall at any and all times have the right to enter
the Premises to inspect the same, to supply janitor service and any service to
be provided by Landlord to Tenant hereunder, to show the Premises to prospective
purchasers or tenants, to post notices of non-responsibility to alter, improve
or repair the Premises or any other portion of the Building, all without being
deemed guilty of any eviction of Tenant and without abatement of rent. Landlord
may, in order to carry out such purposes, erect scaffolding and other necessary
structures where reasonably required by the character of the work to be
performed, provided that the business of Tenant shall be interfered with as
little as is reasonably practicable. Tenant hereby waives any claim for damages
for any injury or inconvenience to or interference with Tenant's business, any
loss of occupancy or quiet enjoyment of the Premises, and any other loss in,
upon and about the Premises. Landlord shall at all times have and retain a key
with which to unlock all doors in the Premises. Any entry to the Premises
obtained by Landlord by any of said means, or otherwise, shall not be construed
or deemed to be a forcible or unlawful entry into the Premises, or an eviction
of Tenant from the Premises or any portion thereof, and any damages caused on
account thereof shall be paid by Tenant. It is understood and agreed that no
provision of this Lease shall be construed as obligating Landlord to perform any
repairs, alterations or decorations except as otherwise expressly agreed herein
by Landlord.

                           16. UTILITIES AND SERVICES

     Provided that Tenant is not in default under this Lease, Landlord agrees to
furnish or cause to be furnished to the Premises the utilities and services
described in the Standards for Utilities and Services, attached hereto as
Exhibit, subject to the conditions and in accordance with the standards set
forth therein. Landlord's failure to furnish any of the foregoing items when
such failure is caused by: (i) accident, breakage, or repairs; (ii) strikes,
lockouts or other labor disturbance or labor dispute of any character; (iii)
governmental regulation, moratorium or other governmental action; (iv) inability
despite the exercise of reasonable diligence to obtain electricity, water or
fuel; or (v) any other cause beyond Landlord's reasonable control, shall not
result in any liability to Landlord. In addition, Tenant shall not be entitled
to any abatement or reduction of rent by reason of such failure, no eviction of
Tenant shall result from such failure and Tenant shall not be relieved from the
performance of any covenant or agreement in this Lease because of such failure.
In the event of any failure, stoppage or interruption thereof, Landlord shall
diligently attempt to resume service promptly.

                                 17. BANKRUPTCY

     If Tenant shall file a petition in bankruptcy under any provision of the
Bankruptcy code as then in effect, or if Tenant shall be adjudicated a bankrupt
in involuntary bankruptcy proceedings and such adjudication shall not have been
vacated within thirty (30) days from the date thereof, or if a receiver or
trustee shall be appointed of Tenant's property and the order appointing such
receiver or trustee shall not be set aside or vacated within thirty (30) days
after the entry thereof, or if Tenant shall assign Tenant's estate or effects
for the benefit of creditors, or if this Lease shall, by

                                       8

<PAGE>

operation of law or otherwise, pass to any person or persons other than Tenant,
then in any such event Landlord may terminate this Lease, if Landlord so elects,
with or without notice of such election and with or without entry or action by
Landlord. In such case, notwithstanding any other provisions of this Lease,
Landlord, in addition to any and all rights and remedies allowed by law or
equity, shall, upon such termination, be entitled to recover damages in the
amount provided in Paragraph 23(b) hereof. Neither Tenant nor any person
claiming through or under Tenant or by virtue of any statute or order of any
court shall be entitled to possession of the Premises but shall surrender the
Premises to Landlord. Nothing contained herein shall limit or prejudice the
right of Landlord to recover damages by reason of any such termination equal to
the maximum allowed by any statute or rule of law in effect at the time when,
and governing the proceedings in which, such damages are to be proved; whether
or not such amount is greater, equal to, or less than the amount of damages
recoverable under the provisions of this Article 17.

                             18. INDEMNIFICATION

     Tenant shall indemnify, defend and hold Landlord harmless from all claims
arising from Tenant's use of the I Premises or the conduct of its business or
from any activity, work, or thing done, permitted or suffered by Tenant in or
about the Premises. Tenant shall further indemnify, defend and hold Landlord
harmless from all claims arising from any breach or default in the performance
of any obligation to be performed by Tenant under the terms of this Lease, or
arising from any act, neglect, fault or omission of Tenant or of its agents or
employees, and from and against all costs, attorneys' fees, expenses and
liabilities incurred in or about such claim or any action or proceeding brought
thereon. In case any action or proceeding shall be brought against Landlord by
reason of any such claim, Tenant upon notice from Landlord shall defend the same
at Tenant's expense by counsel approved in writing by Landlord. Tenant, as a
material part of the consideration to Landlord, hereby assumes all risk of
damage to property or injury to person in, upon or about the Premises from any
cause whatsoever except that which is caused by the failure of Landlord to
observe any of the terms and conditions of this Lease where such failure has
persisted for an unreasonable period of time after written notice of such
failure. Tenant hereby waives all its claims in respect thereof against Landlord
except as permitted by previous sentence.

                        19. DAMAGE TO TENANT'S PROPERTY

     Notwithstanding the provisions of Article 18 to the contrary, Landlord or
its agents shall not be liable for (i) any damage to any property entrusted to
employees of the Building, (ii) loss or damage to any property by theft or
otherwise, (iii) any injury or damage to persons or property resulting from
fIre, explosion, falling plaster, steam, gas, electricity, water or rain which
may leak from any part of the Building or from the pipes, appliances or plumbing
work therein or from the roof, street or sub-surface or from any other place or
resulting from dampness or (iv) any other cause whatsoever, except to the extent
due to the gross negligence or willful misconduct of Landlord. Landlord or its
agents shall not be liable for interference with light or other incorporeal
heraditaments, nor shall Landlord be liable for any latent defect in the
Premises or in the Building. Tenant shall give prompt notice to Landlord in case
off Ire or accidents in the Premises or in the Building or of defects therein or
in the fixtures or equipment.

                             20. TENANT'S INSURANCE

     (a) Tenant shall, during the term hereof and any other period of occupancy,
at it's sole cost and expense, keep in full force and effect the following
insurance:

          (i) Standard form property insurance insuring against the perils of
fire, extended coverage, vandalism, malicious mischief, special extended
coverage ("All Risk") and sprinkler leakage. This insurance policy shall be
upon all property owned by Tenant, for which Tenant is legally liable or
that was installed at Tenant's expense, and which is located in the
Building including, without limitation, furniture, fittings, installations,
fixtures ( other than Tenant Improvements installed by Landlord), and any
other personal property, in an amount not less than the full replacement
cost thereof. In the event that there shall be a dispute as to the amount
which comprises full replacement cost, the decision of Landlord or any
mortgagees of Landlord shall be conclusive. This insurance policy shall also be
upon direct or indirect loss of Tenant's earnings attributable to Tenant's
inability to use fully or obtain access to the Premises or Building in an amount
as will properly reimburse Tenant. Such policy shall name Landlord and any
mortgagees of Landlord as insured parties, as their respective interests may
appear.

                                       9

<PAGE>

          (ii) Commercial liability insurance insuring Tenant against any
liability arising out of the lease, use, occupancy or maintenance of the
Premises and all areas appurtenant thereto. Such insurance shall be in the
amount of $3,000,000.00 combined single limit for injury to, or death of one or
more persons in an occurrence, and for damage to tangible property (including
loss of use) in an occurrence, with such liability amount to be adjusted from
year to year to reflect increases in the Consumer Price Index. The policy shall
insure the hazards of premises and operations, independent contractors,
contractual liability (covering the indemnity contained in Paragraph 18 hereof)
and shall (1) name Landlord as an additional insured, and (2) contain a
provision that "the insurance provided the Landlord hereunder shall be primary
and noncontributing with any other insurance available to the Landlord."

          (iii) Workers' compensation and employer's liability insurance (as
required by state law).

          (iv) Any other form or forms of insurance as Tenant or Landlord or any
mortgagees of Landlord may reasonably require from time to time in form, in
amounts and for insurance risks against which a prudent tenant would protect
itself.

     (b) All policies shall be written in a form satisfactory to Landlord and
shall be taken out with insurance companies holding a General Policy holders
Rating of "A" and a Financial Rating of "X" or better, as set forth in the most
current issue of Bests Insurance Guide. Within ten (10) days after the execution
of this LeaSe, Tenant shall deliver to Landlord copies of policies or
certificates evidencing the existence of the amounts and forms of coverage
satisfactory to Landlord. No such policy shall be cancelable or reducible in
coverage except after thirty (30) days prior written notice to Landlord. Tenant
shall, within ten (10) days prior to the expiration of such policies, furnish
Landlord with renewals or "binders" thereof, or Landlord may order such
insurance and charge the cost thereof to Tenant as additional rent. If Landlord
obtains any insurance that is the responsibility of Tenant under this section,
Landlord shall deliver to Tenant a written statement setting forth the cost of
any such insurance and showing in reasonable detail the manner in which it has
been computed.

                           21. DAMAGE OR DESTRUCTION

          (a) If the Building and/or the Premises is damaged by fire or other
perils covered by Landlord's insurance, Landlord shall have the following rights
and obligations:

               (i) In the event of total destruction, Landlord shall, at
Landlord's option, commence repair, reconstruction and restoration of the
Building and/or the Premises as soon as reasonably possible, and diligently
prosecute the same to completion, in which event this Lease shall remain in full
force and effect. If Landlord elects not to so repair, reconstruct or restore
the Building and/or the Premises, this Lease shall terminate as of the date of
such total destruction. In either event, Landlord shall give Tenant written
notice of its intention within sixty (60) days after the date of damage or
destruction.

               (ii) In the event of a partial destruction of the Building and/or
the Premises, Landlord shall promptly restore the Building and/or the Premises
unless Landlord elects to terminate this Lease as permitted herein. Landlord
shall have the right to terminate this Lease if (1) the damage to the Building
and/or the Premises exceeds twenty-five percent (25%) of the full insurable
value thereof, (2) the damage to the Building and/or the Premises is such that
the Building and/or the Premises cannot be repaired, reconstructed or restored
within one hundred eighty (180) days from the date of damage or destruction, or
(3) insurance proceeds received by Landlord will not be sufficient to cover the
cost of such repairs, reconstruction and restoration. Landlord shall give
written notice to Tenant of its intention within sixty (60) days after the date
of damage or destruction. If Landlord elects not to restore the Building and/or
the Premises, this Lease shall be deemed to have terminated as of the date of
such partial destruction.

          (b) Upon any termination of this Lease under any of the provisions of
this Article 21, the parties shall be released without further obligation to the
other from the date possession of the Premises is surrendered to Landlord except
for items which have theretofore accrued and are then unpaid.

          (c) In the event of repair, reconstruction and restoration by
Landlord as herein provided, the rental payable under this Lease shall be abated
proportionately with the degree to which Tenant's use of the Premises is
impaired during the period of such repair, reconstruction or restoration.
Tenant shall not be entitled to any compensation

                                       10

<PAGE>

or damages for loss the use of the whole or any part of the Premises and/or any
inconvenience or annoyance occasioned by such damage, repair, reconstruction or
restoration.

          (d) Tenant shall not be released from any of its obligations under
this Lease except to the extent and upon the conditions express stated in this
Article 21. Notwithstanding anything to the contrary contained in this Article
21, if Landlord is delayed or prevented from repairing or restoring the damaged
Premises within one year after the occurrence of such damage or destruction by
reason of acts of God, war, governmental restrictions, inability to obtain the
necessary labor or materials, or other cause beyond the control of Landlord,
Landlord shall be relieved of its obligation to make such repairs of restoration
and Tenant shall be released from its obligations under this Lease as of the end
of said one year period.

          (e) If age is due to any cause other than fire or other peril covered
by All-Risk insurance, Landlord may elect to terminate this Lease.

          (f) If Landlord is obligated to or elects to repair or restore as
herein provided, Landlord shall be obligated to make repair or restoration only
of those portions of the Building and the Premises which were originally
provided at Landlord's expense, and the repair and restoration of items not
provided at Landlord's expense shall be the obligation of Tenant.

          (g) Not withstanding anything to the contrary contained in this
Article 21, Landlord shall not have any obligation whatsoever to repair,
reconstruct or restore the Premises when the damage resulting from any casualty
covered under this Article 21, occurs during the last twelve (12) months of the
term of this Lease or any extension hereof.

          (h) The revisions of California Civil Code Section 1932, Subsection 2,
and Section 1933, Subsection 4, which permit termination of a lease upon
destruction of the leased premises, are hereby waived by Tenant; and the
provisions of this article shall govern in case of such destruction.

                               22. EMINENT DOMAIN

          If all of the Premises, or such part thereof as shall substantially
interfere with Tenant's use and occupancy of the Premises, shall be taken for
any public or quasi-public purpose by any lawful power or authority by exercise
of the right of appropriation, condemnation or eminent domain, or sold to
prevent such taking, either party may terminate this Lease effective as of the
date possession is required to be surrendered to said authority. Tenant shall
not assert any claim against Landlord or the taking authority for any
compensation because of such taking, and Landlord shall be entitled to receive
the entire amount of any award without deduction for any estate or interest of
Tenant. If neither party terminates this Lease as permitted herein, Landlord
shall be entitled to the entire amount of the award without deduction for any
estate or interest of Tenant, Landlord shall restore the Premises to
substantially their same condition prior to such partial taking, and rent shall
be abated for the time and to the extent Tenant is prevented from using the
Premises on account of such taking and restoration. Nothing contained in this
paragraph shall be deemed to give Landlord any interest in any award made to
Tenant for the taking of personal property and fixtures belonging to Tenant or
for Tenants moving or relocation expenses.

                           23. DEFAULTS AND REMEDIES

          (a) The occurrence of anyone or more of the following events shall
constitute a default hereunder by Tenant:

               (i) The vacation or abandonment of the Premises by Tenant.
Abandonment is herein defined to include, but is not limited to, any absence by
Tenant from the Premises for five (5) business days or longer while in default
of any provision of this Lease.

               (ii) The failure by Tenant to make any payment of rent where such
failure shall continue for a period of three (3) day after written notice
thereof from Landlord to Tenant; provided however, that any such notice shall be
in lieu of, and not in addition to, any notice required under California Code of
Civil Procedure Section 1161

                                       11

<PAGE>

regarding unlawful detainer actions.

               (iii) The failure by Tenant to observe or perform any of the
express or implied covenants or provisions of this Lease to be observed or
performed by Tenant, other than as specified in Subparagraph 23(a)(i) or (ii)
above, where such failure shall continue for a period often (10)days after
written notice thereof from Landlord to Tenant. Any such notice shall be in lieu
of, and not in addition to, any notice required under California Code of Civil
Procedure Section 1161 regarding unlawful detainer actions. If the nature of
Tenant's default is such that more than ten (10) days are reasonably required
for its cure, then Tenant shall not be deemed to be in default if Tenant shall
commence such cure within said ten-day period and thereafter diligently
prosecute such cure to completion, which completion shall occur not later than
sixty (60) days from the date of such notice from Landlord.

               (iv) (1) The making by Tenant of any general assignment for the
benefit of creditors (2) the filing by or against Tenant of a petition to have
Tenant adjudged a bankrupt or a petition for reorganization or arrangement under
any law relating to bankruptcy (unless, in the case of a petition filed against
Tenant, the same is dismissed within thirty (30) days); (3) the appointment of a
trustee or receiver to take possession of substantially all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease, where possession
is not restored to Tenant within thirty (30) days; or (4) the attachment,
execution or other judicial seizure of substantially all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease where such seizure
is not discharged within thirty (30) days.

          (b) In the event of any such default by Tenant, in addition to any
other remedies available to Landlord at law or in equity, Landlord shall have
the immediate option to terminate this Lease and all rights of Tenant hereunder.
In the event that Landlord shall elect to so terminate this Lease then Landlord
may recover from Tenant:

               (i) the worth at the time of award of any unpaid rent which had
been earned at the time of such termination; plus

               (ii) 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 Tenant proves could have been
reasonably avoided; plus

               (iii) the worth at the time of award of the amount by which the
unpaid rent for the balance of the term after the time of award exceeds the
amount of such rental loss that Tenant proves could be reasonably avoided; plus

               (iv) any other amount necessary to compensate Landlord for all
detriment approximately caused by Tenant's failure to perform Tenant's
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom.

As used in Subparagraphs 23(b)(i) and (ii) above, the "worth at the time of
award" is computed by allowing interest at the maximum rate permitted by law. As
used in Subparagraph 23(b)(iii) above, the "worth at the time of award" is
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of award plus one percent (1%).

          (c) In the event of any such default Landlord shall also have the
right to continue this Lease in full force and effect, and this Lease shall
continue in full force and effect as long as Landlord does not terminate this
Lease, and Landlord shall have the right to collect rent as it becomes due.

          (d) Landlord shall also have the right, with or without terminating
this Lease, to reenter the Premises and remove all persons and property from the
Premises; such property may be removed and stored in a public warehouse or
elsewhere at the cost of and for the account of Tenant. No reentry or taking
possession of the Premises by Landlord pursuant to this Paragraph 23(c) shall
be construed as an election to terminate this Lease unless a written notice of
such intention is given to Tenant or unless the termination thereof is decreed
by a court of competent jurisdiction.

          (e) All rights, options and remedies of Landlord contained in this
Lease shall be construed and held to be cumulative, and no one of them shall be
exclusive of the other. Landlord shall have the right to pursue anyone or

                                       12

<PAGE>

all of such remedies or any other remedy or relief which may be provided by law,
whether or not stated in this Lease. No waiver of any default of Tenant
hereunder shall be implied from any acceptance by Landlord of any rent or other
payments due hereunder or any omission by Landlord to take any action on account
of such default if such default persists or is repeated, and no express waiver
shall affect defaults other than as specified in said waiver. The consent or
approval of Landlord to or of any act by Tenant requiring Landlord's consent or
approval shall not be deemed to waive or render unnecessary Landlord's consent
or approval to or of any subsequent similar acts by Tenant.

                         24. ASSIGNMENT AND SUBLETTING

          (a) Tenant shall not voluntarily assign or encumber its interest in
this Lease or in the Premises, or sublease all or any part of the Premises, or
allow any other person or entity to occupy or use all or any part of the
Premises, without fIrst obtaining Landlord's prior written consent. Any
assignment, encumbrance or sublease without Landlord's prior written consent
shall be voidable, at Landlord's election, and shall constitute a default and at
the option of the Landlord shall result in a termination of this Lease. No
consent to assignment, encumbrance, or sublease shall constitute a further
waiver of the provisions of this paragraph. Tenant shall notify Landlord in
writing of Tenant's intent to sublease, encumber or assign this Lease and
Landlord shall, within thirty (30) days of receipt of such written notice, elect
one of the following: (i) consent to such proposed assignment or sublease or;
(ii) refuse such consent, which refusal shall be on reasonable grounds; or (iii)
elect to terminate this Lease.

          (b) As a condition for granting its consent to any assignment,
encumbrance or sublease, thirty (30) days prior to any anticipated assignment or
sublease Tenant shall give Landlord written notice (the "Assignment Notice"),
which shall set forth the name, address and business of the proposed assignee or
sublessee, information (including references) concerning the character,
ownership and financial condition of the proposed assignee or sublessee, the
Assignment Date, any ownership or commercial relationship between Tenant and the
proposed assignee or sublessee, all in such detail as Landlord shall reasonably
require. If Landlord requests additional detail, the Assignment Notice shall not
be deemed to have been received until Landlord received such additional detail,
and Landlord may withhold consent to any assignment or sublease until such
additional detail is provided to it. Further, Landlord may require that the
sublessee or assignee remit directly to Landlord on a monthly basis, all monies
due to Tenant by said assignee or sublessee.

          (c) The consent by Landlord to any assignment or subletting shall not
be construed as relieving Tenant or any assignee of this Lease or sublessee of
the Premises from obtaining the express written consent of Landlord to any
further assignment or subletting or as releasing Tenant or any assignee or
sublessee of Tenant from any liability or obligation hereunder whether or not
then accrued. In the event Landlord shall consent to an assignment or sublease,
Tenant shall pay Landlord as additional rent a reasonable attorneys' and
administration fee not to exceed $1,000 for costs incurred in connection with
evaluating the Assignment Notice. This section shall be fully applicable to all
further sales, hypothecation, transfers, assignments and subleases of any
portion of the by any successor or assignee of Tenant, or any sublessee of the
Premises.

          (d) As used in this section, the subletting of substantially all of
the Premises for substantially all of the remaining term of this Lease shall be
deemed an assignment rather than a sublease. Notwithstanding the foregoing,
Landlord shall consent to the assignment, sale or transfer if the Assignment
Notice states that Tenant desires to assign the Lease to any entity into which
Tenant is merged, with which Tenant is consolidated or which acquires all of
substantially all of the assets of Tenant, provided that the assignee first
executes, acknowledges and delivers to Landlord an agreement whereby the
assignee agrees to be bound by all of the covenants and agreements in this Lease
which Tenant has agreed to keep, observe or perform, that the assignee agrees
that the provisions of this section shall be binding upon it as if it were the
original Tenant hereunder and that the assignee shall have a net worth
(determined in accordance with generally accepted accounting principles
consistently applied) immediately after such assignment which is at least equal
to the net worth (as so determined) of Tenant at the commencement of this Lease.

          (e) Except as provided above, Landlord's consent to any sublease shall
not be unreasonably withheld. A condition to such consent shall be delivery by
Tenant to Landlord of a true copy of any such sublease. If for any proposed
assignment or sublease Tenant receives rent or other consideration, either
initially or over the term of the assignment or sublease, in excess of the rent
called for hereunder, or, in case of the sublease of a portion of the Premises,
in excess of such rent fairly allocable to such portion, after appropriate
adjustments to assure that all other payments

                                       l3

<PAGE>

called for hereunder are taken into account, Tenant shall pay to Landlord as
additional rent hereunder three-quarters (3/4) of the excess of each such
payment of rent or other consideration received by Tenant promptly after its
receipt. Landlord's waiver or consent to any assignment or subletting shall not
relieve Tenant from any obligation under this lease. The parties intend that the
preceding sentence shall not apply to any sublease rentals respecting a portion
of the Premises that during the entire term of this Lease was not occupied by
Tenant for its own use, but was always subleased by Tenant and/or kept vacant.
For the purposes of this section, the rent for each square foot of floor space
in the Premises shall be deemed equal.

                               25. SUBORDINATION

          Without the necessity of any additional document being executed by
Tenant for the purpose of effecting a subordination, and at the election of
Landlord or any mortgagee with a lien on the building or any ground lessor with
respect to the building, this Lease shall be subject and subordinate at all
times to:

               (i) All ground leases or underlying leases which may now exist or
hereafter be executed affecting the building or the land upon which the building
is situated or both;

               (ii) The lien of any mortgage or deed of trust which may now
exist or hereafter be executed in any amount for which the building, land,
ground leases, or underlying leases, or Landlord's interest or estate in any of
said items is specified as security .Notwithstanding the foregoing, Landlord
shall have the right to subordinate or cause to be subordinated any such leases
or underlying leases or any such liens to this Lease. In the event that any
ground lease or underlying lease terminates for any reason or any mortgage or
deed of trust is foreclosed or a conveyance in lieu of foreclosure is made for
any reason, Tenant shall, notwithstanding any subordination, attorney to and
become the Tenant of the successor in interest to Landlord, at the option of
such successor in interest. Tenant covenants and agrees to execute and deliver,
upon demand by Landlord and in the form requested by Landlord, any additional
documents evidencing the priority or subordination of this Lease with respect to
any such ground leases or underlying leases or in the lien of any such mortgage
or deed of trust. Tenant hereby irrevocably appoints Landlord as
attorney-in-fact of Tenant to execute, deliver and record any such document in
the name and on behalf of Tenant.

                            26. ESTOPPEL CERTIFICATE

          (a) Within ten (10) days following any written request which Landlord
may make from time to time, Tenant shall execute and deliver to Landlord a
statement certifying: (i) the date of commencement of this Lease; (ii) the fact
that this Lease is unmodified and in full force and effect (or, if there have
been modifications); (iii) the date to which the rental and other sums payable
under this Lease have been paid; (iv) that there are no current defaults under
this Lease by either Landlord or Tenant except as specified in Tenant's
statement; and (v) such other matters requested by Landlord. Landlord and Tenant
intend that any statement delivered pursuant to this Article 26 may be relied
upon by any mortgage, beneficiary, purchaser, or prospective purchaser of the
building or any interest therein.

          (b) Tenant's failure to deliver such statement within such time shall
be conclusive upon Tenant: (i) that this Lease is in full force and effect,
without modification except as may be represented by Landlord, (ii) that there
are no uncured defaults in Landlord's performance, and (iii) that not more than
one month's rental has been paid in advance.

                                  27. SIGNAGE

          Landlord shall provide for Tenant the opportunity to have a Tenant
identification sign at the entry to the Premises and the right to have Tenant's
name placed upon the building directory sign and a monument or building signage
at Landlord's election. Tenant shall have no other right to maintain a Tenant
identification sign in any other location in, on or about the Premises, the
building, or the Project. Tenant's identification sign shall be subject to
Landlord's written reasonable approval prior to installation. The cost of the
installation of the sign, and its maintenance and removal expense, shall be at
Tenant's sole expense. If Tenant fails to maintain its sign or if Tenant fails
to remove its sign upon termination of this Lease or restore the appearance of
the Premises to its condition prior to the placement of said sign, Landlord may
do so at Tenant's expense and Tenant's reimbursement to Landlord for such
amounts shall be deemed additional rent. All signs shall comply with rules and
regulations set forth by Landlord as may be modified

                                       14

<PAGE>

from time to time.

                            28. RULES AND REGULATIONS

          Tenant shall faithfully observe and comply with the "Rules and
Regulations," a copy of which is attached 1% hereto and marked EXHIBIT D and all
reasonable and nondiscriminatory modifications thereof and additions thereto
from time to time put into effect by Landlord. Landlord shall not be
responsible to Tenant for the violation or nonperformance by any other tenant
or occupant of the building of any of said Rules and Regulations.

                              29. CONFLICT OF LAW

          This Lease shall be governed by and construed pursuant to the laws of
the State of California.

                           30. SUCCESSORS AND ASSIGNS

          Except as otherwise provided in this Lease, all of the covenants,
conditions, and provisions of this Lease shall be bindIng upon and shall inure
to the benefit of the parties hereto and their respective heirs, personal
representatives, successors, and assigns.

                           31. SURRENDER OF PREMISES

          The voluntary or other surrender of this Lease by Tenant, or a mutual
cancellation thereof, shall not work a merger, and shall, at the option of
Landlord, operate as an assignment to it of any or all subleases or
subtenancies.

                              32. ATTORNEY'S FEES

          (a) If Landlord should bring suit for possession of the Premises, for
the recovery of any sum due under this Lease, or because of the breach of any
provisions of this Lease, or for any other relief against Tenant hereunder, or
in the event of any other litigation between the parties with respect to this
Lease, then all costs and expenses, including reasonable attorney's fees,
incurred by the prevailing party therein shall be paid by the other party which
obligation on the part of the other party shall be deemed to have accrued on the
date of the commencement of such action and shall be enforceable whether or not
the action is prosecuted to judgment. (b) If Landlord is named as a defendant in
any suit brought against Tenant in connection with or arising out of Tenant's
occupancy hereunder, Tenant shall pay to Landlord its costs and expenses
incurred in such suit, including reasonable attorney's fees.

                           33. PERFORMANCE BY TENANT

          All covenants and agreements to be performed by Tenant under any of
the terms of this Lease shall be performed by Tenant at Tenant's sole cost and
expense and without any abatement of rent. If Tenant shall fail to pay any sum
of money owed to any party other than Landlord, for which it is liable
hereunder, or if Tenant shall fail to perform any other act on its part to be
performed hereunder and such failure shall continue for ten (10) days after
notice thereof by Landlord, Landlord may, without waiving or releasing Tenant
from obligations of Tenant, but shall not be obligated to, make any such payment
or perform any such other act to be made or performed by Tenant. All sums so
paid by Landlord and all necessary incidental costs together with interest
thereon at the maximum rate permissible by law, from the date of such payment by
Landlord, shall be payable to Landlord on demand. Tenant covenants to pay any
such sums and Landlord shall have (in addition to any other right or remedy of
Landlord) all rights and remedies in the event of the nonpayment thereof by
Tenant as are set forth in Article 23 hereof.

                            34. MORTGAGEE PROTECTION

          In the event of any default on the part of Landlord, Tenant will give
notice by registered or certified mail to any beneficiary of a deed of trust or
mortgage covering the Premises whose address shall have been furnished to
Tenant, and shall offer such beneficiary or mortgagee a reasonable opportunity
to cure the default, including time to obtain

                                       15
<PAGE>

possession of the Premises by power of sale or a judicial foreclosure, if such
should prove necessary to effect a cure.

                           35. DEFINITION OF LANDLORD

          The term "Landlord", as used in this Lease, so far as covenants or
obligations on the part of the Landlord are concerned, shall be limited to mean
and include only the owners, at the time in question, of the fee title of the
Premises or the lessees under any ground lease, if any. In the event of any
transfer, assignment, or other conveyances, the then grantor shall be
automatically freed and relieved from and after the date of such transfer,
assignment, or conveyance of all liability as respects the performance of any
covenants or obligations on the part of Landlord contained in this Lease
thereafter to be performed. Without further agreement, the transferee of such
title shall be deemed to have assumed and agreed to observe and perform any
and all obligations of Landlord hereunder, during its ownership of the
Premises. Landlord may transfer its interest in the Premises without the consent
of Tenant and such transfer or subsequent transfer shall not be deemed a
violation on Landlord's part of any of the terms and conditions of this Lease.

                                  36. WAIVER

          The waiver by Landlord of any breach of any term, covenant, or
condition herein contained shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant, or condition herein contained,
nor shall any custom or practice which may grow up between the parties in the
administration of the terms hereof be deemed a waiver of or in any way affect
the right of Landlord to insist upon the performance by Tenant in strict
accordance with said terms. The subsequent acceptance of rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of
any term, covenant, or condition of this Lease, other than the failure of Tenant
to pay the particular rent so accepted, regardless of Landlord's knowledge of
such preceding breach at the time of acceptance of such rent.

                         37. IDENTIFICATION OF TENANT

          If more than one person executes this Lease as Tenant:

               (i) Each of them is jointly and severally liable for the keeping,
observing and performing of all of the terms, covenants, conditions,
provisions, and agreements of this Lease to be kept, observed and performed by
Tenant, and

               (ii) The term "Tenant" as used in this Lease shall mean and
include each of them jointly and severally. The act of or notice from, or notice
or refund to, or the signature of anyone or more of them, with respect to the
tenancy of the Lease, including, but not limited to any renewal, extension,
expiration, termination, or modification of this Lease, shall be binding upon
each and all of the persons executing this Lease as Tenant with the same force
and effect as if each and all of them had so acted or so given or received such
notice or refund or so signed.

                                  38. PARKING

          The use by Tenant, its employees and invitees, of the parking
facilities of the building shall be on the terms and conditions set forth in
Exhibit E attached hereto and by this reference incorporated herein and shall be
subject to such other agreement between Landlord and Tenant as may hereinafter
be established.

                             39. TERMS AND HEADINGS

          The words "Landlord" and "Tenant" as used herein shall include the
plural as well as the singular. Words used in any gender include other genders.
The paragraph headings of this Lease are not a part of this Lease and shall have
i no effect upon the construction or interpretation of any part hereof.

                            40.FINANCIAL STATEMENTS

          Tenant shall deliver to Landlord within ten (10) days after written
request therefor, the current financial statements of Tenant, and financial
statements for the two (2) years prior to the current financial statements year,

                                       16
<PAGE>

including a balance sheet and profit and loss statement for the most recent
prior year, all prepared in accordance with generally accepted accounting
principles.

                                    41. TIME

          Time is of the essence with respect to the performance of every
provision of this Lease in which time or performance is a factor.

                        42. PRIOR AGREEMENT; AMENDMENTS

          This Lease contains all of the agreements of the parties hereto with
respect to any matter covered or mentioned in this Lease, and no prior agreement
or understanding pertaining to any such matter shall be effective for any
purpose. No provisions of this Lease may be amended or added to except by an
agreement in writing signed by the parties hereto or their respective successors
in interest.

                                43. SEPARABILITY

          Any provision of this Lease which shall prove to be invalid, void, or
illegal in no way affects, impairs, or invalidates any other provision hereof,
and any such other provisions shall remain in full force and effect.

                                 44. RECORDING

          Neither Landlord nor Tenant shall record this Lease nor a short form
memorandum thereof without the consent of the other.

                                  45. CONSENTS

          Whenever the consent of either party is required hereunder such
consent shall not be unreasonably withheld.

                          46. LIMITATION OF LIABILITY

          In consideration of the benefits accruing hereunder, Tenant and all
successors and assigns covenant and agree that, in the event of any actual or
alleged failure, breach, or default hereunder by Landlord:

          (a) The sole exclusive remedy shall be against the Landlord's interest
in the building;

          (b) No partner of Landlord shall be sued or named as a party in any
suit or action (except as may be necessary to secure jurisdiction of the
partnership);

          (c) No service of process shall be made against any partner of
Landlord (except as may be necessary to secure jurisdiction of the partnership);

          (d) No partner of Landlord shall be required to answer or otherwise
plead to any service of process;

          (e) No judgment will be taken against any partner of Landlord;

          (f) Any judgment taken against any partner of Landlord may be vacated
and set aside at any time nunc pro tunc;

          (g) No writ of execution will ever be levied against the assets of
any partner of Landlord;

          (h) These covenants and agreements are enforceable both by Landlord
and also by any partner of Landlord.

                                       17
<PAGE>

                                   47. RIDERS

          Clauses, plats, and riders, if any, signed by Landlord and Tenant and
affixed to this Lease are a part hereof.

                                  48. EXHIBITS

          All exhibits attached hereto are incorporated into this Lease.

                          49. MODIFICATION FOR LENDER

          If, in connection with obtaining construction, interim, or
permanent financing for the building the lender shall request reasonable
modifications in this Lease as a condition to such financing, Tenant will not
unreasonably withhold, delay, or defer its consent thereto, provided that such
modifications do not increase the obligations of Tenant hereunder or materially
adversely affect the leasehold interest hereby created or Tenant's rights
hereunder.

                              50. OPTION TO EXTEND

          (a) Provided that Tenant is not in default hereunder either at
the time of exercise or at the time the extended term commences, Tenant shall
have the option to extend the initial term of this Lease for one (1) additional
period of Three (3) years ("Option Period") on the same terms, covenants and
conditions provided herein, except that upon such renewal the monthly
installments of Annual Basic Rent due hereunder shall be determined at the time
notice to extend is given. Tenant shall exercise its option by giving Landlord
written notice ("Option Notice") no later than one hundred eighty (180) days
prior to the expiration of the initial term.

          (b) The monthly installments of Annual Basic Rent for the Option
Period shall be determined as follows:

               (i) Within fifteen (15) business days after Landlord's receipt of
the Option Notice, the parties shall attempt to agree on the monthly rent for
the Option Period in question based upon the then fair market rental value of
the Premises. If the parties agree on the monthly rent for the Option Period
within such fifteen (15) day period, they shall immediately execute an
amendment to this Lease stating the monthly rent for the Option Period.

               (ii) The "then fair market rental value of the Premises" shall
mean the fair market monthly rental value of the premises as of the commencement
of the Option Period, taking into consideration the uses permitted under this
Lease, the quality, size, design and location of the Premises, and comparable
buildings located within a one (1) mile radius of the Premises. In no event
shall the then fair market monthly rental value of the Premises for the Option
Period be less than the monthly installments of Annual Basic Rent last payable
under the Lease.

               (iii) Within seven (7) days after the expiration of the fifteen
(15) day period, each party, at its cost and by giving notice to the other
party, shall appoint a real estate appraiser or commercial leasing salesperson
("Appraiser") with at least five (5) years' full-time commercial appraisal or
leasing experience in the area in which the Premises are located to appraise and
set the then fair market monthly rent for the Premises for the Option Period.

          (c) If Tenant objects to the monthly rent that has been determined,
Tenant shall have the right to rescind its exercise of the option to extend and
have this Lease expire at the end of the initial term, provided that Tenant pays
for all reasonable costs incurred by Landlord in connection with the appraisal
procedure. Tenant's election to allow this Lease to expire at the end of the
initial term must be exercised by delivering written notice of exercise to
Landlord within ten (10) days after the rent determination procedure has been
completed and Tenant has received notice of the monthly rent as determined by
appraisal. If Tenant does not so exercise its election to terminate this Lease
within the ten (10) day period, the initial term of this Lease shall be extended
as provided in this paragraph. Notwithstanding the foregoing, if Tenant elects
to so rescind exercise of its option to extend and, at the time of such election
there are less than one hundred eighty (180) days remaining on the initial term
of the Lease, then, the termination of this Lease shall not be effective until
one hundred eighty (180) days after Landlord's receipt of Tenant's notice of
rescission. During any period that the term of this Lease is so extended beyond
the original termination date, Tenant shall be required to

                                       18

<PAGE>

pay the amount of monthly rent determined pursuant to the appraisal procedure.

          (d) This option to extend and any rights granted to Tenant hereunder
shall be personal to Tenant and any of its affiliates and subsidiaries. No
rights granted to Tenant pursuant to this paragraph shall be in any way
applicable to subtenants or assignees of Tenant unless such subtenant or
assignee is an affiliate or subsidiary of Tenant.

                                       19
<PAGE>

               IN WITNESS WHEREOF, the parties have executed this Lease as of
               the date first written above.

LANDLORD                              ADDRESS:
--------                              --------
PRINCETON INVESTMENT GROUP LLC        5300 STEVENS CREEK BLVD, SUITE 450
                                      SAN JOSE, CA 95129
    \s\ Paul Ling
By  ------------------------
    Paul Ling
    President

TENANT                                ADDRESS:
------                                --------

XACCT

By  /s/ Eric Gries
    ------------------------

Its President & CEO
    ------------------------

                                       20

<PAGE>

                                   EXHIBIT A

                         OUTLINE OF TENANT'S FLOOR PLAN

                                 2900 LAKESIDE
                             SANTA CLARA, CA 95054

                                       1

<PAGE>

                                   EXHIBIT B
                             WORK LETTER AGREEMENT

     This Work Letter Agreement is entered into as of the day of November 12,
1999, by and between Princeton Investment Group LLC, ("Landlord") and XACCT, A
DELAWARE CORPORATION ("TENANT").

                                   RECITALS:

     A. Concurrently with the execution of this Work Letter Agreement, Landlord
and Tenant have entered into a lease (the "Lease") covering certain premises
(the "Premises") more particularly described in Exhibit A attached to the Lease.

     B. In order to induce Tenant to enter into the Lease (which is hereby
incorporated by reference to the extent that the provisions of this Work Letter
Agreement may apply thereto) and in consideration of the mutual covenants
hereinafter contained, Landlord and Tenant hereby agree as follows:

                             1. COMPLETION SCHEDULE

     Within ten (10) days after the execution of the Lease, Landlord shall
deliver to Tenant, for Tenant's review and approval, a schedule (the "Work
Schedule") setting forth a timetable for the planning and completion of the
installation of the Tenant Improvements to be construction in the Premises. The
Work Schedule shall set forth each of the various items of work to be done by or
approval to be given by Landlord and Tenant in connection with the completion of
the Tenant Improvements. Such schedule shall be submitted to Tenant for its
approval and, upon approval by both Landlord and Tenant, such schedule shall
become the basis for completing the Tenant Improvement work. If Tenant shall
fail to approve the Work Schedule, as it may be modified after discussions
between Landlord and Tenant, within five (5) working days after the date such
schedule is first received by Tenant, Landlord may, at its option, terminate the
Lease and all of its obligations thereunder.

                             2. TENANT IMPROVEMENTS

     Reference herein to "Tenant Improvements" shall be a build out per the E2C
plans dated (DATE TO BE ENTERED HERE AFTER SPACE PLANNING IS FINALIZED), to
the extent that such construction and/or build out does not exceed the "Tenant
Improvement Allowance" provided in Section 6 of this Work Letter Agreement and
shall be subject to all provisions in Section 6 of this Work Letter Agreement.

                           3. TENANT IMPROVEMENT PLANS

     Immediately after the execution of the Lease, Tenant agrees to meet with
Landlord's architect and/or space planner to prepare a space plan for the layout
of the Premises. Based upon such space plan, Landlord's architect shall prepare
final working drawings and specifications for the Tenant Improvements. Such
final working drawings and specifications may be referred to herein as the
"Tenant Improvement Plans."

                     4. FINAL PRICING AND DRAWING SCHEDULE

     After the preparation of the space plan and after Tenant's written approval
thereof, in accordance with the Work Schedule, Landlord shall cause its
architect to prepare and submit to Tenant the final working drawings and
specifications referred to in Paragraph Three (3) hereof. Such working drawings
shall be approved by Landlord and Tenant in accordance with the Work Schedule
and shall thereafter be submitted to the appropriate governmental body for plan
checking and a building permit. Landlord, with Tenant's cooperation, shall cause
to be made any changes in the plans and specifications necessary to obtain the
building permit. Concurrent with the plan checking, Landlord shall have prepared
a final pricing for Tenant's approval, taking into account any modifications
which may be required to reflect changes in the plans and specifications
required by the city or county in which the Premises are located. After final
approval of the working drawings, no further changes to the Tenant Improvement
Plans may be made without the prior written approval from both Landlord and
Tenant, and then only after agreement by Tenant to pay any excess costs
resulting from such changes.

                                  2
<PAGE>

                     5. CONSTRUCTION OF TENANT IMPROVEMENTS

          After the Tenant Improvements Plans have been prepared and approved,
the final pricing has been approved and a building permit for the Tenant
Improvements has been issued, Landlord shall enter into a construction contract
with its contractor for the installation of the Tenant Improvements in
accordance with the Tenant Improvement Plans. Landlord shall supervise the
completion of such work and shall use its best efforts to secure completion of
the work in accordance with the Work Schedule. The cost of such work shall be
paid as provided in Paragraph Six (6) hereof.

                 6. PAYMENT OF COST OF THE TENANT IMPROVEMENTS

          (a) Landlord hereby grants to Tenant a "Tenant Allowance" of Six
Dollars ($6.00) per rentable square foot of the Premises for a total not to
exceed Sixty-five Thousand Eight Hundred Twenty Dollars and no/100ths
($65,820.00). Tenant shall bear the sole responsibility for all improvement
expenses in excess of the allowance ("overage") provided, if any, except due to
any required ADA improvements. Such overage shall be paid to Landlord by Tenant
within Five (5) days of receipt of invoice from Landlord. Such Tenant Allowance
shall be used only for:

               (i) Payment of the cost of preparing the space plan and the final
working drawings and specifications, including mechanical, electrical and
structural drawings and of all other aspects of the Tenant Improvement Plans.
The Tenant Allowance will not be used for the payment of extraordinary design
work not included within the scope of Landlord's building standard improvements
or for payments to any other consultants, designers, or architects other than
Landlord's architect and/or space planner;

               (ii) The payment of permit and license fees relating to
construction of the Tenant Improvements;

               (iii) Construction of the Tenant Improvements, including, without
limitation, the following:

                    (1) Installation within the Premises of all partitioning,
doors, floor coverings, finishes, ceilings, wall coverings and painting,
millwork, and similar items;

                    (2) All electrical wiring, lighting fixtures, outlets, and
switches, and other electrical work to be installed within the Premises;

                    (3) The furnishing and installation of all duct work,
terminal boxes, fuses and accessories required for the completion of the
heating, ventilation and air conditioning systems within the Premises, including
the cost of meter and key control for after-hour air conditioning;

                    (4) Any additional Tenant requirements including, but not
limited to odor control, special heating, ventilation and air conditioning,
noise or vibration control, or other special systems;

                    (5) All fire and life safety control systems such as fire
walls, sprinklers, halon, fire alarms, including piping, wiring, and accessories
installed within the Premises; and

                    (6) All plumbing, fixtures, pipes, and accessories to be
installed within the Premises.

          b) The cost of each item shall be charged against the Tenant
Allowance. In the event that the cost of installing the Tenant Improvements, as
established by Landlord's final pricing schedule, shall exceed the Tenant
Allowance, or if any of the Tenant Improvements are not to be paid out of the
Tenant Allowance as provided in Paragraph Six (6) above, the excess shall be
paid by Tenant to Landlord prior to the commencement of construction of the
Tenant Improvements.

          (c) In the event that, after the Tenant Improvement Plans have been
prepared and a price therefor established by Landlord, Tenant shall require any
changes or substitutions to the Tenant Improvement Plans, any additional costs
thereof shall be paid by Tenant to Landlord prior to the commencement of such
work.

                                       3
<PAGE>

                   7. COMPLETION AND RENTAL COMMENCEMENT DATE

The commencement of the term of this Lease and Tenant's obligation for the
payment of rental under the Lease shall not commence until substantial
completion of construction of the Tenant Improvements. However, if there shall
be a delay in substantial completion of the Tenant Improvements as a result
of:

               (i) Tenant's failure to approve any item or perform any other
obligation in accordance with and by the date specified in the Work Schedule;

               (ii) Tenant's request for materials, finishes or installations
other than those readily available; or

               (iii) Tenant's changes in the Tenant Improvement Plans after
their approval by Tenant;

then commencement of the term of the Lease and the rental commencement date
shall be accelerated by the number of days of such delay.

               IN WITNESS WHEREOF, the parties have executed this Lease as of
the date first written above

LANDLORD                              ADDRESS:
--------                              --------

PRINCETON INVESTMENT GROUP LLC        5300 STEVENS CREEK BLVD, SUITE 450
                                      SAN JOSE, CA 95129

By  /s/ Paul Ling
    ------------------
    Paul Ling
    President

TENANT                                ADDRESS:

XACCT
By  /s/ Eric Gries
    ------------------

Its President & CEO
    ------------------

<PAGE>

                                   EXHIBIT C

                      STANDARDS FOR UTILITIES AND SERVICES

          The following Standards for Utilities and Services are in effect.

          Landlord reserves the right to adopt nondiscriminatory
modifications and additions hereto.

          As long as Tenant is not in default under any of the terms, covenants,
conditions, provisions, or agreements of this Lease, Landlord shall:

          (a) Provide non-attended automatic elevator facilities Monday
through Friday, except holidays, from 8:00 a.m. to 6:00 p.m.

          (b) On Monday through Friday, except holidays, from 7:00 a.m.- 6:00
p.m. (and other times for a reasonable additional charge to be fixed by
Landlord), ventilate the Premises and furnish air conditioning or heating on
such days and hours, when in the judgment of Landlord it may be required for the
comfortable occupancy of the Premises. The air conditioning system achieves
maximum cooling when the window coverings are closed. Landlord shall not be
responsible for room temperatures if Tenant does not keep all window coverings
in the Premises closed whenever the system is in operation. Tenant agrees to
cooperate fully at all times with Landlord, and to abide by all regulations and
requirements which Landlord may prescribe for the proper function and protection
of the air conditioning system. Tenant agrees not to connect any apparatus,
device, conduit, or pipe to the building chilled and hot water air conditioning
supply lines. Tenant further agrees that neither Tenant nor its servants,
employees, agents, visitors, licensees, or contractors shall at any time enter
mechanical installations or facilities of the building or adjust, tamper with,
touch or otherwise in any manner affect said installations or facilities. The
cost of maintenance and service calls to adjust and regulate the air
conditioning system shall be charged to Tenant if the need for maintenance work
results from either Tenant's adjustment of room thermostats or Tenant's failure
to comply with its results from either Tenant's adjustment of room thermostats
or Tenant's failure to comply with its obligations under this section, including
keeping window coverings closed as needed. Such work shall be charged at hourly
rates equal to then current journeymen's wages for air conditioning mechanics.

          (c) Landlord shall furnish to the Premises, during the usual
business hours on business days, electric current as required by the Building
standard office lighting and fractional horsepower office business machines in
the amount of approximately two and one-half (2.5) KWH watts per square foot.
Tenant agrees, should its electrical installation or electrical consumption be
in excess of the aforesaid quantity or extend beyond normal business hours, to
reimburse Landlord monthly for the measured consumption at the average cost per
kilowatt hour charged to the building during the period. If a separate meter is
not installed at Tenant's cost, such excess costs will be established by an
estimate agreed upon by Landlord and Tenant, and if the parties fail to agree,
as established by an independent licensed engineer. Said estimates to be
reviewed and adjusted quarterly. Tenant agrees not to use any apparatus or
device in, or upon, or about the Premises which may in any way increase the
amount of such services usually furnished or supplied to said Premises, and
Tenant further agrees not to connect any apparatus or device with wire,
conduits, pipes, or other means by which such services are supplied, for the
purpose of using additional or unusual amounts of such services without written
consent of Landlord. Should Tenant use the same to excess, the refusal on the
part of Tenant to pay upon demand of Landlord the amount established by Landlord
for such excess charge shall constitute a breach of the obligation to pay rent
under this Lease and shall entitle Landlord to the rights therein granted for
such breach. At all times Tenant's use of electric current shall never exceed
the capacity of the feeders to the building or the risers or wiring installation
and Tenant shall not install or use or permit the installation or use of an
excessive amount of computers or electronic data processing equipment in the
premises, without the prior written consent of Landlord.

          (d) Water will be available in public areas for drinking and lavatory
purposes only, but if Tenant requires, uses, or consumes water for any purposes
in addition to ordinary drinking and lavatory purposes of which fact Tenant
constitutes Landlord to be the sole judge, Landlord may install a water meter
and thereby measure Tenant's water consumption for all purposes. Tenant shall
pay Landlord for the cost of the meter and the cost of the installation thereof
and throughout the duration of Tenant's occupancy, Tenant shall keep said meter
and installation equipment in good working order and repair at Tenant's own cost
and expense, in default of which Landlord may cause such meter and equipment
replaced or repaired and collect the cost thereof from Tenant. Tenant agrees to
pay for water consumed, as shown on said meter, as and when bills are rendered,
and on default in making such payment, Landlord may pay such

                                       1
<PAGE>

charges and collect the same from Tenant. Any such costs or expenses incurred,
or payments made by Landlord for any of the reasons or purposes hereinabove
stated shall be deemed to be additional rent payable by Tenant and collectible
by Landlord as such.

          (e) Provide janitor service to the Premises, provided the same are
kept reasonably in order by Tenant, and if to be kept clean by Tenant, no one
other than persons approved by Landlord shall be permitted to enter the Premises
for such purposes. If the Premises are not used exclusively as offices, they
shall be kept clean and in order by Tenant, at Tenant's expense, and to the
satisfaction of Landlord, and by persons approved by Landlord. Tenant shall pay
to Landlord the cost of removal of any of Tenant's refuse and rubbish, to the
extent that the same exceeds the refuse and rubbish usually attendant upon the
use of the Premises as offices.

          Landlord reserves the right to stop service of the elevator, plumbing,
ventilation, air conditioning, and electric systems, when necessary, by reason
of accident or emergency or for repairs, alterations or improvements, in the
judgment of Landlord desirable or necessary to be made, until said repairs,
alterations or improvements shall have been completed, and shall further have no
responsibility or liability for failure to supply elevator facilities, plumbing,
ventilating, air conditioning, or electric service, when prevented from so doing
by strike or accident or by any cause beyond Landlord's reasonable control, or
by laws, rules, orders, ordinances, directions, regulations, or requirements of
any federal, state, county, or municipal authority or failure of gas, oil, or
other suitable fuel supply or inability by exercise of reasonable diligence to
obtain gas, oil, or other suitable fuel. It is expressly understood and agreed
that any covenants on Landlord's part to furnish any service pursuant to any of
the terms, covenants, conditions, provisions, or agreements of this Lease, or to
perform any act or thing for the benefit of Tenant, shall not be deemed breached
if Landlord is unable to furnish or perform the same by virtue of a strike or
labor trouble or any other cause whatsoever beyond Landlord's control.

                                       2
<PAGE>

                                   EXHIBIT D
                             RULES AND REGULATIONS

     1.   Except as specifically provided in the Lease to which these rules and
          regulations are attached, no sign, placard, picture, advertisement,
          name, or notice shall be installed or displayed on any part of the
          outside or inside of the building without the prior written consent of
          Landlord. Landlord shall have the right to remove, at Tenant's expense
          and without notice, any sign installed or displayed in violation of
          this rule. All approved signs or lettering on doors and walls shall be
          printed, painted, affixed, or inscribed at the expense of Tenant by a
          person approved by Landlord.

     2.   If Landlord objects in writing to any curtains, blinds, shades,
          screens, or hanging plants or other similar objects attached to or
          used in connection with any window or door of the Premises, or placed
          on any window sill, which is visible from the exterior of the
          Premises, Tenant shall immediately discontinue such use. Tenant shall
          not place anything against or near glass partitions, doors, or windows
          which may appear unsightly from outside the Premises.

     3.   Tenant shall not obstruct any sidewalks, halls, passages, exits,
          entrances, elevators, escalators, or stairways of the building. The
          halls, passages, exits, entrances, shopping malls, elevators, and
          stairways are not open to the general public, but are open, subject to
          reasonable regulation, to Tenant's business invitee. Landlord shall in
          all cases retain the right to control and prevent access thereto of
          all persons whose presence in the judgment of Landlord would be
          prejudicial to the safety, character, reputation, and interest of the
          building and its tenants; provided that nothing herein contained shall
          be construed to prevent such access to persons with whom any tenant
          normally deals in the ordinary course of its business, unless such
          persons are engaged in illegal or unlawful activities. No tenant and
          no employee or invitee of any tenant shall go upon the roof of the
          building.

     4.   The directory of the building will be provided exclusively for the
          display of the name and location of tenants only, and Landlord
          reserves the right to exclude any other names therefrom.

     5.   All cleaning and janitorial services for the building and the
          Premises shall be provided exclusively through Landlord, and except
          with the written consent of Landlord, no person or persons other than
          those approved by Landlord shall be employed by Tenant or permitted to
          enter the building for the purpose of cleaning the same. Tenant shall
          not cause any unnecessary labor by carelessness or indifference to the
          good order and cleanliness of the Premises.

     6.   Landlord will furnish Tenant, free of charge, with two keys to each
          door lock in the Premises. Landlord may make a reasonable charge for
          any additional keys. Tenant shall not make or have additional keys,
          and Tenant shall not alter any lock or install a new additional lock
          or bolt on any door of its Premises. Tenant, upon the termination of
          its tenancy, shall deliver to Landlord the keys of all doors which
          have been furnished to Tenant, and in the event of loss of any keys so
          furnished, shall pay Landlord therefor.

     7.   If Tenant requires telegraphic, telephonic, burglar alarm, or
          similar services, it shall first obtain, and comply with, Landlord's
          instructions in their installation.

     8.   Tenant shall not place a load upon any floor of the Premises which
          exceeds the load per square foot which such floor was designed to
          carry and which is allowed by law. Landlord shall have the right to
          prescribe the weight, size, and position of all equipment, materials,
          furniture, or other property brought into the building. Heavy objects
          shall, if considered necessary by Landlord, stand on such platforms as
          determined by Landlord to be necessary to properly distribute the
          weight, which platforms shall be provided at Tenant's expense.
          Business machines and mechanical equipment belonging to Tenant, which
          cause noise or vibration that may be transmitted to the structure of
          the building or to any space therein to such a degree as to be
          objectionable to Landlord or to any tenants in the building, shall be
          placed and maintained by Tenant, at Tenant's expense, on vibration
          eliminators or other devices sufficient to eliminate noise or
          vibration. The

                                                                       EXHIBIT D
<PAGE>

          persons employed to move such equipment in or out of the building must
          be acceptable to Landlord. Landlord will not be responsible for loss
          of, or damage to, any such equipment or other property from any cause,
          and all damage done to the building by maintaining or moving such
          equipment or other property shall be repaired at the expense of
          Tenant.

     9.   Tenant shall not use or keep in the Premises any kerosene,
          gasoline, inflammable, or combustible fluid or material other than
          those limited quantities necessary for the operation of maintenance of
          office equipment. Tenant shall not use or permit to be used in the
          Premises any foul or noxious gas or substance, or permit or allow the
          Premises to be occupied or used in a manner offensive or objectionable
          to Landlord or other occupants of the building by reason of noise,
          odors, or vibrations, nor shall Tenant bring into or keep in or about
          the Premises any birds or animals.

     10.  Tenant shall not use any method of heating or air conditioning
          other than that supplied by Landlord.

     11.  Tenant shall not waste electricity, water, or air conditioning and
          agrees to cooperate fully with Landlord to assure the most effective
          operation of the building's heating and air conditioning and to comply
          with any governmental energy-saving rules, laws, or regulations
          of which Tenant has actual notice.

     12.  Landlord reserves the right, exercisable without notice and without
          liability to Tenant, to change the name and street address of
          the building.

     13.  Landlord reserves the right to exclude from the building between
          the hours of 6:30 p.m. and 6:30 a.m. the following day, or such other
          hours as may be established from time to time by Landlord, and on
          Sundays and legal holidays, any person unless that person is known to
          the person or employee in charge of the building and has a pass or is
          properly identified. Tenant shall be responsible for all persons for
          whom it requests passes and shall be liable to Landlord for all acts
          of such persons. Landlord shall not be liable for damages for any
          error with regard to the admission to or exclusion from the building
          of any person.

     14.  The toilet rooms, toilets, urinals, wash bowls, and other
          apparatus shall not be used for any purpose other than that for which
          they were constructed and no foreign substance of any kind whatsoever
          shall be thrown therein. The expense of any breakage, stoppage, or
          damage resulting from the violation of this rule shall be borne by the
          tenant who, or whose employees or invitees, shall have caused it.

     15.  Tenant shall not sell, or permit the sale at retail, of
          newspapers, magazines, periodicals, theater tickets, or any other
          goods or merchandise to the general public in or on the Premises.
          Tenant shall not make any room-to-room solicitation of business from
          other tenants in the building. Tenant shall not use the Premises for
          any business or activity other than that specifically provided for in
          Tenant's Lease.

     16.  Tenant shall not install any radio or television antenna,
          loudspeaker, or other devices on the roof or exterior walls of the
          building. Tenant shall not interfere with radio or television
          broadcasting or reception from or in the building or elsewhere.

     17.  Tenant shall not mark, drive nails, screws, or drill into the
          partitions, woodwork, or plaster or in any way deface the Premises or
          any part thereof, except in accordance with the provisions of the
          Lease pertaining to alterations. Landlord reserves the right to direct
          electricians as to where and how telephone and telegraph wires are to
          be introduced to the Premises. Tenant shall not cut or bore holes for
          wires. Tenant shall not affix any floor covering to the floor of the
          Premises in any manner except as approved by Landlord. Tenant shall
          repair any damage resulting from noncompliance with this rule.

     18.  Tenant shall not install, maintain, or operate upon the Premises
          any vending machines without the written consent of Landlord.

     19.  Canvassing, soliciting, and distribution of handbills or any other
          written material, and peddling in the building are prohibited and
          Tenant shall cooperate to prevent such activities.

                                                                       EXHIBIT D

<PAGE>

     20.  Landlord reserves the right to exclude or expel from the building
          any person who, in Landlord's judgement, is intoxicated or under the
          influence of liquor or drugs or who is in violation of any of the
          Rules or Regulations of the building.

     21.  Tenant shall store all its trash and garbage within its Premises
          or in other facilities provided by Landlord. Tenant shall not place in
          any trash box or receptacle any material which cannot be disposed of
          in the ordinary and customary manner of trash and garbage disposal.
          All garbage and refuse disposal shall be made in accordance with
          directions issued from time to time by Landlord.

     22.  The Premises shall not be used for the storage of merchandise held
          for sale to the general public, or for lodging or for manufacturing of
          any kind, not shall the Premises be used for any improper, immoral, or
          objectionable purpose. No cooking shall be done or permitted on the
          Premises without Landlord's consent, except that the use by Tenant of
          Underwriter' Laboratory approved equipment for brewing coffee, tea,
          hot chocolate, and similar beverages or use of microwave ovens for
          employee uses shall be permitted, provided such equipment and use is
          in accordance with all applicable federal, state, county, and city
          laws, codes, ordinances, rules, and regulations.

     23.  Tenant shall not use in any space or in the public halls of the
          building any hand truck except those equipped with rubber tires and
          side guards or such other material-handling equipment as Landlord may
          approve. Tenant shall not bring any other vehicles of any kind into
          the building.

     24.  Without the written consent of Landlord, Tenant shall not use the
          name of the building in connections with or in promoting or
          advertising the business of Tenant except as Tenant's address.

     25.  Tenant shall comply with all safety, fire protection, and evacuations
          procedures and regulations established by Landlord or any governmental
          agency.

     26.  Tenant assumes any and all responsibility for protecting its
          Premises from theft, robbery, and pilferage, which includes keeping
          doors locked and other means of entry to the Premises closed.

     27.  Tenant's requirements will be attended to only upon appropriate
          application to the building management office by an authorized
          individual. Employees of Landlord shall not perform any work or do
          anything outside of their regular duties unless under special
          instructions from Landlord, and no employee of Landlord will admit any
          person (Tenant or otherwise) to any office without specific
          instructions from Landlord.

     28.  Landlord may waive anyone or more of these Rules and Regulations
          for the benefit of Tenant or any other tenant, but no such waiver by
          Landlord shall be construed as a waiver of such Rules and Regulations
          in favor of Tenant or any other tenant, nor prevent Landlord from
          thereafter enforcing any such Rules and Regulations against any or all
          of the tenants of the building.

     29.  These Rules and Regulations are in addition to, and shall not be
          construed to in any way modify or amend, in whole or in part, the
          terms, covenants, agreements, and conditions of Tenant's lease of its
          Premises in the building.

     30.  Landlord reserves the right to make such other and reasonable
          Rules and Regulations as, in its judgment, may from time to time be
          needed for safety and security, for care and cleanliness of the
          building and for the preservation of good order therein. Tenant agrees
          to abide by all such Rules and Regulations hereinabove stated and any
          additional rules and regulations which are adopted.

     31.  Tenant shall be responsible for the observance of all of the
          foregoing rules by Tenant's employees, agents, clients, customers,
          invitees, and guests.

                                                                       EXHIBIT D

<PAGE>

                                   EXHIBIT E
                         PARKING RULES AND REGULATIONS

The following rules and regulations shall govern use of the parking facilities
which are appurtenant to the building.

     1.   Tenant shall not park or permit the parking of any vehicle under its
control in any parking designated by Landlord as areas for parking by visitors
to the building. Tenant shall not leave vehicles in the parking areas overnight
nor park any vehicles in the parking areas other than automobiles, motorcycles,
motor driven or non-motor driven bicycles or four-wheeled trucks.

     2.   Parking stickers or any other device or form of identification
supplied by Landlord as a condition of use of the parking facilities shall
remain the property of Landlord. Such parking identification device must be
displayed as requested and may not be mutilated in any manner. The serial number
of the parking identification device may not be obliterated. Devices are not
transferable and any device in the possession of an unauthorized holder will be
void.

     3.   No overnight or extended term storage of vehicles shall be permitted.

     4.   Vehicles must be parked entirely within the painted stall lines of a
single parking stall.

     5.   All directional signs and arrows must be observed.

     6.   The speed limit within all parking areas shall be 5 miles per hour.

     7.   Parking is prohibited:
          (a) in areas not striped for parking;
          (b) in aisles;
          (c) where "no parking" signs are posted;
          (d) on ramps;
          (e) in cross hatched areas; and
          (f) in such other areas as may be designated by Landlord.

     8.   Every parker is required to park and lock his own vehicle. All
responsibility for damage to vehicle is assumed by the parker.

     9.   Loss or theft of parking identification devices from automobiles
must be reported immediately, and a lost or stolen report must be filed by
the customer at that time. Landlord has the right to exclude any car from
the parking facilities that does not have an identification device.

     10.  Any parking identification devices found by the purchaser must be
reported immediately to avoid confusion.

     11.  Lost or stolen devices found by the purchaser must be reported
immediately to avoid confusion.

     12.  Washing, waxing, cleaning, or servicing of any vehicle in any area
not specifically reserved for such purpose is prohibited.

     13.  Landlord reserves the right to modify and/or adopt such other
reasonable and non-discriminatory rules and regulations for the parking
facilities as it deems necessary for the operation of the parking facilities.
Landlord may refuse to permit any person who violates these rules to park in the
parking facilities, and any violation of the rules shall subject the car to
removal.

     14.  Landlord shall grant to Tenant forty-two (42) non-reserved parking
stalls in the parking lot adjacent to the office building. There shall be no
charge for said non-reserved parking stalls. In the event that the ratio of
parking stalls to rentable area in the building decreases, Landlord shall have
the right, at that time, to reduce Tenant's parking allotment.

                                                                       EXHIBIT E
<PAGE>

                                    ADDENDUM
                                       to
                                 2900 Lakeside
                             OFFICE BUILDING LEASE

                            Dated November 12, 1999

     1. Exhibit B, Work Letter Agreement is hereby modified as follows:

     a. Tenant shall be permitted to select and use the architect, contractors
        and/or space planner of its choice to design and construct Tenant's
        improvements.

     b. Tenant shall be entitled to payment of $6.00 per square foot in the same
        manner as if Tenant were to use Landlord's architect, contractor and/or
        space planner.

     c. Tenant shall deliver to Landlord, for Landlord's review and approval, a
        work schedule within 5 business days of execution of the Lease.

     2. The Lease commencement date and obligation of Tenant to commence the
        payment of rent shall begin on January 16, 2000 whether or not the
        Premises are ready for occupancy.

     3. In the event a tenant vacates any space in the Building during the term
        of the Lease, Landlord shall first offer such space for lease by Tenant
        prior to making such space available for lease by any third party on
        the same terms and conditions.

     Executed as of the date first written above.

     LANDLORD                              ADDRESS:
     --------                              --------

     Princeton Investment Group LLC        5300 Stevens Creek Blvd, Suite 450
                                           San Jose, CA 95129

     By \s\Paul Ling
        -----------------
        Paul Ling
        President

     TENANT                                ADDRESS:
     --------                              --------

     XACCT Technologies, Inc.              2855 Kifer Road, Suite 105
                                           Santa Clara, CA 95051
     By \s\Eric Gries
        -----------------
        Eric Gries
        President & CEO

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