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Texas-Austin-6500 River Place Boulevard Lease - Investors Life Insurance Co. of North America and eLoyalty Corp.

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                      RIVER PLACE POINTE II LEASE AGREEMENT




                                 By and Between




                INVESTORS LIFE INSURANCE COMPANY OF NORTH AMERICA
                                  ("Landlord")




                                       and




                              ELOYALTY CORPORATION
                                   ("Tenant")





                             DATED: MARCH ____, 2000







<PAGE>   2



                      RIVER PLACE POINTE II LEASE AGREEMENT


         THIS LEASE is entered into as of March ____, 2000, between INVESTORS
LIFE INSURANCE COMPANY OF NORTH AMERICA, a Washington corporation ("Landlord"),
whose address for purposes of notice hereunder is 701 Brazos, Suite 1400,
Austin, Texas, 78701 and eLOYALTY CORPORATION, a Delaware corporation
("Tenant"), whose local address prior to the Commencement Date (defined in
Section 2.01 hereof) is 701 Brazos, Suite 680, Austin, Texas 78701, and whose
local address after the Commencement Date shall be 6500 River Place Boulevard,
Building II, Suite 400, Austin, Texas, 78730.

                              W I T N E S S E T H:

                                    ARTICLE 1

         1.01 PREMISES. Landlord hereby leases to Tenant, and Tenant hereby
leases from Landlord, for the rent and subject to the provisions of this Lease,
the space (the "Premises") reflected on the floor plan(s) attached as Exhibit
"A" hereto, consisting of the entire fourth (4th) floor and approximately the
east one-half (2) of the third (3rd) floor of the building (the "Building")
known as River Place Pointe II located at 6500 River Place Boulevard, Austin,
Travis County, Texas, in River Place Pointe (the "Project"). The Project is a
multi-building office project under construction by Landlord containing multiple
office buildings, ground-level open areas and walkways, parking areas and
garages and other structures or improvement located on the real property
described on Exhibit "B" attached hereto and made a part hereof for all purposes
(the "Land"). The Building, as well as River Place Pointe I and the River Place
Pointe Parking Garage I ("Parking Garage I") are currently under construction by
Landlord. It is anticipated that the Premises will contain approximately 40,691
square feet of rentable area and the Building will contain approximately 112,782
net rentable square feet as measured by the most recent BOMA Standard Method of
Floor Measurement (the "BOMA Standard(s)"). The usable and rentable square
footage of the Premises shall be measured by Landlord's architect, and such
measurement shall be approved by Tenant's architect, in accordance with BOMA
Standards, taking into account that the fourth floor will be a single tenant
floor and the third floor will be a multi-tenant floor. In the event the
measurement of the Premises according to BOMA Standards results in a change in
the rentable area of the Premises, all appropriate terms herein shall be
adjusted accordingly. Within ten (10) days after the Commencement Date Tenant
and Landlord shall execute a declaration (in the form of Exhibit "D" hereto)
specifying, among other things, the measurements of the Premises and the
Building as determined by Landlord's architect and approved by Tenant's
architect.

                                    ARTICLE 2





<PAGE>   3

         2.01 TERM. Subject to the other provisions hereof, and any exhibits
hereto, this Lease shall be for a term of approximately five (5) years
commencing on the Commencement Date (defined in Section 2.02 hereof) and
expiring on May 31, 2005 (the "Expiration Date"). Such term, as it may be
modified or extended, is herein called the "Term." A "Lease Year" shall be the
twelve month period beginning on June 1 of each calendar year and ending on May
31 of the following calendar year.

         2.02 COMMENCEMENT. As used herein, "Commencement Date" means the
earlier to occur of: (a) June 7, 2000, or if later, the date the Premises
(including the Tenant Improvements described on Exhibit "C") are Substantially
Completed (as hereinafter defined), or would have been Substantially Completed
but for Tenant Delays (as defined in Exhibit "C"), and Landlord has notified
Tenant of such completion, or (b) the date Tenant begins the occupancy of all or
any part of the Premises in a reasonably normal manner for the conduct of
Tenant's business. The parties anticipate the Premises will be Substantially
Complete on or about June 7, 2000. "Substantial Completion" (or "Substantially
Complete" or "Substantially Completed") shall mean that Landlord has received a
temporary or permanent certificate of occupancy from the City of Austin
permitting Tenant's occupancy of the Premises, that Tenant's architect has
approved the measurement of the Premises as taken my Landlord's architect, and
that the Premises (and parking and other improvements in the Project reasonably
necessary to Tenant's use and enjoyment of the Premises) are sufficiently
complete to allow Tenant's use and occupancy of the Premises, except for any
work upon which Landlord and Tenant shall have agreed to in writing ("Punch List
Items"), the performance of which shall not, after Tenant commences occupancy of
the Premises, significantly interrupt or interfere with Tenant's use thereof.
Landlord agrees to complete any Punch List Items within thirty (30) days after
the Commencement Date. Within ten (10) days after the Commencement Date Tenant
and Landlord shall execute a declaration (in the form of Exhibit "D" hereto)
specifying, among other things, the actual date on which the Commencement Date
occurred.

         Landlord hereby consents to Tenant having limited access to the
Premises three (3) weeks prior to the Commencement Date (the "Early Access
Period") to install its equipment and furnishings preparatory to its occupancy
of the Premises, subject however to City of Austin temporary certificate of
occupancy requirements and City of Austin Fire Department and Building
Inspection Department life safety issues ("COA Issues"), and provided Tenant has
delivered to Landlord evidence of all insurance required to be carried by Tenant
under this Lease. Tenant's early access to the Premises is governed by Paragraph
10 of the Exhibit "C" hereto. Landlord and Tenant agree to mutually and
reasonably cooperate with each other during the Early Access Period. Tenant
acknowledges and agrees that during the Early Access Period, Landlord may still
be in process of completing the Tenant Improvements, including, without
limitation, laying carpet. During the Early Access Period, Tenant will use
reasonable efforts to accommodate Landlord's completion of the Tenant
Improvements. Likewise, Landlord



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<PAGE>   4




acknowledges and agrees that during the Early Access Period, Tenant will be
installing, subject to COA Issues, wiring, equipment and furniture (including
wall and furniture systems) and Landlord will use reasonable efforts to
accommodate Tenant's pre-occupancy installations during the Early Access Period.
Landlord acknowledges that Tenant is not required to pay rent during the Early
Access Period.

         2.03 RENEWAL OPTION. Landlord hereby gives and grants to Tenant two (2)
options to renew this Lease for respective periods of five (5) years each, on
the terms and conditions set forth in Exhibit "E". The first renewal term shall
commence on the expiration of the initial Term, and the second renewal term
shall commence on the expiration of the Term as extended by the first renewal
option.

         2.04 RIGHT OF FIRST REFUSAL. Landlord hereby grants Tenant a right of
first refusal with respect to all remaining space on the third floor of the
Building as set forth in "Exhibit "F".

         2.05 EXPANSION OPTION. Landlord hereby gives and grants to Tenant an
expansion option ("Expansion Option") on the terms and conditions set forth in
Exhibit "G".

                                    ARTICLE 3

         3.01 BASE RENT. Tenant, in consideration for this Lease, agrees to pay
to Landlord a base rental ("Base Rent") for each square foot of rentable area
agreed to in writing by Landlord and Tenant to be within the Premises, for each
calendar year during this Lease as follows:

         Lease Year 1      -        $18.50 per rentable square foot
         Lease Year 2      -        $19.00 per rentable square foot
         Lease Year 3      -        $19.50 per rentable square foot
         Lease Year 4      -        $20.00 per rentable square foot
         Lease Year 5      -        $20.50 per rentable square foot

The Base Rent shall be payable in equal monthly installments, the amount of
which shall be determined by dividing the total rent for each respective Lease
Year by twelve (12), and payable at Landlord's address herein provided in legal
tender of the United States of America, without notice, demand, counterclaim,
set-off or abatement (except as expressly provided in this Lease), in advance on
the first day of each calendar month throughout the Term, except that the first
such monthly installment is due upon the date of execution of this Lease by
Tenant. Notwithstanding the foregoing, if the Commencement Date is a date other
than the first day of a calendar month, then the rent for the Base Rent for the
first month of this Lease shall be a sum equal to the Base Rent specified for
the first full calendar month as herein provided, times a fraction, the
numerator of which equals the number of days from the Commencement Date to the
end of the




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<PAGE>   5



calendar month during which the Commencement Date falls and the denominator of
which equals the number of days in the same calendar month.

         3.02 TENANT'S PERCENTAGE SHARE OF OPERATING EXPENSES. In addition to
the Base Rent, Tenant, as additional consideration for this Lease, agrees to pay
to Landlord Tenant's Percentage Share of Operating Expenses (defined in Section
3.04 hereof) annualized for each calendar year during the Term. On or before the
Commencement Date and thereafter on or before the first day of each calendar
year of the Term, Landlord shall provide to Tenant the Estimated Operating
Expense (defined in Section 3.03 hereof) for the upcoming calendar year. Tenant
shall pay in advance on the first day of each calendar month during the Term,
installments equal to one-twelfth (1/12) of Tenant's Percentage Share of
Estimated Operating Expenses annualized for each calendar year. Within one
hundred twenty (120) days after the end of each calendar year during the Term,
Landlord shall furnish to Tenant a statement certified by Landlord of the Actual
Operating Expenses for the immediately preceding calendar year. If Tenant's
Percentage Share of Estimated Operating Expenses paid to Landlord during the
previous calendar year exceeds Tenant's Percentage Share of Actual Operating
Expenses for such year, then Landlord shall refund the difference to Tenant at
the time Landlord furnishes the statement of the Actual Operating Expense.
Otherwise, within fifteen (15) days after Landlord furnishes such statement to
Tenant, Tenant shall make a lump sum payment to Landlord equal to the positive
difference between Tenant's Percentage Share of the Actual Operating Expense for
the preceding calendar year over Tenant's Percentage Share of the Estimated
Operating Expense paid by Tenant for the preceding calendar year. As used in
this Lease the term "Rent" shall refer collectively to the Base Rent and
Tenant's Percentage Share of Estimated Operating Expenses. If the Commencement
Date is on a day other than the first day of the month, then Tenant shall be
required to pay only a pro-rata portion of the installment of Rent due for such
month.

         Landlord will cause adequate books and records to be maintained to
permit Tenant to verify computations of Operating Expenses and other amounts
relevant to Tenants obligations under this Lease; provided, Landlord shall not
be required to maintain any books and records concerning any payment due
hereunder for more than 2 years after such payment is due. Further, Landlord
shall permit Tenant or Tenant's representative to audit such books and records
during normal business hours and shall assist in any way reasonably required for
such audits. Landlord shall also furnish explanations in reasonable detail if
requested by Tenant of any computation made under this Lease. All determinations
required or permitted of Landlord concerning payments for Operating Expenses and
other charges due hereunder shall be subject to verification by Tenant. If any
such determinations are found to be incorrect, an adjustment will be promptly
made between Landlord and Tenant to correct any underpayments or overpayments
resulting from such incorrect determinations. If an audit of Operating Expenses
for any calendar year reveals that Tenant was overcharged under this Section
3.02 by more than ten percent (10%) for that year, Landlord will reimburse
Tenant for the cost of such audit. However, notwithstanding that a disagreement
may arise between Tenant and Landlord about any





                                       4


<PAGE>   6


determination required or permitted of Landlord concerning Rent and other
charges due hereunder, Tenant shall continue to pay Rent and other charges as
herein provided pending resolution of such determination.

         3.03 TENANT'S PERCENTAGE SHARE. For purposes of this Lease, the term
"Tenant's Percentage Share" shall mean a percentage which is equal to the number
of rentable square feet contained in the Premises divided by the total number of
rentable square feet contained in the Building, as both such measurements have
been agreed to in writing by Landlord and Tenant.

         3.04 OPERATING EXPENSES. "Operating Expenses" shall mean and include
all reasonable amounts, expenses, and costs of whatever nature paid by or on
behalf of Landlord for the management (excluding wages and benefits for
employees above the level of building manager), operation, repair, maintenance
and security of the Building and Landlord's personal property which may be
reasonably utilized in connection therewith. Without limiting the foregoing,
Operating Expenses will include a share (equal to the rentable square footage of
the Building divided by the total rentable square footage of all buildings in
the Project from time to time) of any costs and expenses incurred by Landlord
which are for the benefit of the Project generally, rather than any particular
Building. If, however, greater security is required for an occupant of a
particular building in the Project, or if an occupant requires repairs or
maintenance to such occupant's specific tenant improvements (excluding however,
repairs or maintenance to the Base Building which are included in Operating
Expenses), the cost of such greater security or repairs or maintenance to such
occupant's specific tenant improvements will not be treated as a cost for the
benefit of the Project generally under this provision, but will be allocated
specifically to such occupant. Notwithstanding the foregoing, controllable
Operating Expenses (which include landscaping, janitorial, pest control and
waste removal) shall not increase more than five percent (5%) per annum.

         Notwithstanding anything to the contrary herein, Operating Expenses
shall not include, and Tenant shall not be required to pay or reimburse Landlord
for any part of the following: property management fees in excess of five
percent (5%) of Base Rent; the cost of capital improvements or depreciation
(except as expressly permitted by the next sentence); interest and principal
payments on mortgages, ground lease rentals and other non-operating debts of
Landlord; specific costs for special items or services billed to specific
tenants (or that would be billed to another tenant if its lease required
payments in addition to base rent on substantially the same terms and conditions
as this Lease requires of Tenant); costs of correcting construction or design
defects or violations of law existing as of the Commencement Date; legal fees or
other costs incurred because of any lease negotiation or dispute between
Landlord and other tenants or prospective tenants; income, excess profits,
franchise, transfer, estate or inheritance taxes; costs paid by insurance,
recovery upon construction warranties or other sources (excluding reimbursement
by tenants for Operating Expenses); leasing commissions, attorneys' fees,





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<PAGE>   7




advertising expenses, and other expenses incurred in connection with leasing,
selling or conveying any interest in the Project or the land associated
therewith; costs of repairs or other work occasioned by fire, wind storm or
other casualty or necessitated by condemnation. Operating Expenses shall,
however, include:

         (A)      The annual cost of all capital improvements made subsequent to
                  the final completion of the Building (including the Premises)
                  which, although capital in nature, can reduce the normal
                  operating costs of the Building, as amortized in accordance
                  with generally accepted accounting principles, consistently
                  applied; provided that such amortization shall not be more in
                  any calendar year than Landlord's reasonable estimate of the
                  resulting savings in other Operating Expenses.

         (B)      The annual cost of all capital improvements made in order to
                  comply with any statutes, rules, regulations, or directives
                  enacted or promulgated by any governmental authority after the
                  effective date of this Lease, as amortized in accordance with
                  generally accepted accounting principles, consistently
                  applied.

         If at any time during the Term the present method of ad valorem
taxation or assessment against the Land, Building or Project shall be so changed
that the whole or any part of the real estate taxes or assessments now levied,
assessed or imposed on the Land, Building or Project shall be changed and as a
substitute therefor, or in lieu of an addition thereto, taxes, assessments or
charges shall be levied, assessed or imposed wholly or partially as a capital
levy or otherwise on the rents received from the Project or the Rent due under
this Lease or any part thereof, then such substitute or additional taxes,
assessments or charges, to the extent so levied, assessed or imposed, shall be
deemed to be included within the real estate taxes to the extent that such
substitute or additional tax actually substitutes for and replaces prior real
estate taxes or is imposed in lieu of or in addition to existing real estate
taxes.

         Operating Expenses shall be determined on an accrual basis in
accordance with generally accepted accounting principles, consistently applied.
The "Estimated Operating Expense" shall equal the Landlord's reasonable estimate
of Operating Expenses for the applicable calendar year. Landlord's statement of
the Estimated Operating Expense shall control for the year specified in such
statement and for each succeeding year during the Term until Landlord provides a
new statement of the Estimated Operating Expense. Landlord's Estimated Operating
Expense for the calendar year 2000 is $8.00 per rentable square foot, prorated
for the number of months in 2000 the Building is completed. The "Actual
Operating Expense" shall equal the operating expenses actually incurred for the
applicable calendar year. Notwithstanding the foregoing, in no event shall
Tenant be required to pay an amount in excess of the total of Actual Operating
Expenses less amounts payable by other tenants in the Building.






                                       6



<PAGE>   8

         Operating Expenses shall be reduced by any insurance proceeds or
eminent domain awards to the extent the same may be received by Landlord.
Landlord may deduct from such proceeds or awards, the reasonable expenses
incurred in obtaining such proceeds or awards (including without limitation
legal and other professional fees) provided that such expenses were not
previously billed as Estimated Operating Expenses or Actual Operating Expenses.

         3.05 TENANT IMPROVEMENTS. Prior to the applicable Commencement Date,
Landlord shall, on the terms and conditions set forth in Exhibit "C" construct
the improvements desired by Tenant to complete the Premises for Tenant's
occupancy (the "Tenant Improvements").

                                    ARTICLE 4

         4.01 USE. Tenant shall use and occupy the Premises only for office
purposes, for software development and training, and for no other purposes.
Tenant shall not do or permit anything to be done in the Premises or authorize
anything to be done in other parts of the Project, nor shall Tenant bring or
keep anything in the Project, that will in any way increase the existing rate of
or affect any fire or other insurance upon the Project or any of its contents,
or cause cancellation of any insurance policy covering the Project or any part
thereof or any of its contents. Tenant shall not do or permit anything to be
done in the Premises or authorize anything to be done in other parts of the
Project that will unreasonably or improperly obstruct or interfere with the
rights of other tenants or occupants of the Project or injure or annoy them or
tend to lower the first class character of the building or create unreasonable
elevator loads or otherwise interfere with standard Building operations. Tenant
shall not do or permit anything to be done in the Premises or authorize anything
to be done in other parts of the Project that would constitute a nuisance.
Tenant shall not commit or suffer to be committed any waste in or upon the
Premises. Tenant shall not use the Premises nor authorize or permit anything to
be done in other parts of the Project that will in any way conflict with any
private restrictive covenant, law, statute, ordinance or any rule or regulation
of Landlord or any governmental or quasi-governmental authority now in force or
that may hereafter be enacted or promulgated.

                                    ARTICLE 5

         5.01 LANDLORD'S SERVICES. Provided Tenant is not in default hereunder,
Landlord shall, at Landlord's expense, except as provided to the contrary in
this Lease, furnish to Tenant the following services:

         (a)      Subject to curtailment as required by governmental laws, rules
                  or regulations, air conditioning and central heat, in season,
                  at temperatures between 67 and 78 degrees F., during all
                  Normal Building Hours. ("Normal Building Hours" will be 7:00
                  a.m. through 6:00 p.m. on weekdays and 8:00 a.m. through 12:00
                  p.m. on



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<PAGE>   9



                  Saturdays, exclusive of Normal Business Holidays. "Normal
                  Business Holidays" for purposes of this Lease shall be the
                  days reasonably designated as such by Landlord from time to
                  time (but not more than nine days in any calendar year), which
                  days may include, without limitation, New Year's Day, Martin
                  Luther King Day, Good Friday, Memorial Day, Independence Day,
                  Labor Day, Thanksgiving Day, the Friday following Thanksgiving
                  Day and Christmas Day. If in the case of any holiday described
                  herein a different day shall be observed than the respective
                  day described, then the day which constitutes the day observed
                  by national banks in Austin, Texas, on account of such holiday
                  shall constitute the holiday under this Lease.)

         (b)      Janitorial services in the Premises and public portions of the
                  Building for all days except Saturdays, Sundays, and Normal
                  Business Holidays.

         (c)      Water at those points of supply provided for drinking, toilet,
                  and lavatory purposes.

         (d)      Normal and customary routine maintenance, and any repairs
                  required from time to time, for all public, structural, and
                  exterior portions of the Project and for the HVAC and other
                  Building systems.

         (e)      Electric lighting service for all public portions of the
                  Building, Parking Garage I, the surface parking areas serving
                  the Building, and the Project.

         (f)      Reasonably adequate, non-exclusive automatic passenger
                  elevator service at all times for access to and egress from
                  the Premises. There are no separate freight elevators in the
                  Building. Tenant shall have the right to use the passenger
                  elevators, in common with other tenants, for freight uses
                  during reasonable business hours as prescribed by Landlord,
                  exclusive of Saturdays, Sundays, and Normal Business Holidays
                  unless otherwise approved by Landlord, as long as Tenant
                  appropriately pads the elevator walls to insure that no damage
                  is caused to elevators by virtue of Tenant's use for freight
                  purposes. If Tenant desires to use any elevator for freight
                  purposes for any extended period (more than one hour), Tenant
                  must get the prior approval of Landlord.

         (g)      Electric energy that Tenant shall require for normal office
                  equipment such as typewriters, dictation machines,
                  calculators, personal computers, telephones, facsimile
                  machines, copying machines and other machines of a similar
                  electrical consumption, and Building Standard (defined in
                  Exhibit "C" attached hereto) lighting in the Premises. Without
                  Landlord's prior written consent, Tenant shall not be entitled
                  to employ lighting on the Premises that consumes electrical
                  current




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<PAGE>   10



                  in excess of Building Standard lighting nor utilize space
                  heaters nor utilize any office equipment that consumes more
                  than 0.5 kilowatts per hour at rated capacity or requires a
                  voltage of other than 120 volts single phase or an electric
                  capacity greater than any limitations on capacity contemplated
                  in the Drawings approved by Landlord and Tenant as described
                  in Exhibit "C". The Building will have normal and customary
                  electrical service typical to supply a first class office
                  building in Austin, Texas, for use by all of the tenants of
                  the Building.

         (h)      Building security to encourage compliance with the Rules and
                  Regulations (defined in Section 15.09 hereof) and to limit
                  after-hour access to the Building; provided, however, Landlord
                  shall have no responsibility to prevent, and shall not be
                  liable to Tenant for, and shall be indemnified by Tenant
                  against, liability or loss to Tenant, its agents, employees
                  and visitors arising out of losses due to theft, burglary, or
                  damage or injury to persons or property caused by persons
                  having or gaining access to the Building or the Premises,
                  whether or not caused by Landlord's negligence, and Tenant
                  hereby releases Landlord from all liability relating thereto.
                  Tenant shall have 24-hour access to the Building and the
                  Premises by a card access system

         (i)      Window washing services for the outside portions of the
                  Building up to two (2) times per calendar year, as needed.

         5.02     ADDITIONAL SERVICE COST. Tenant shall pay Landlord, upon
demand, such additional amounts as are necessary to recover additional costs
incurred by Landlord in performing or providing janitorial, maintenance,
security, or other services or requirements of Tenant (and in paying additional
taxes) as to any non-Building Standard installations in the Premises.

         Tenant shall pay Landlord, upon monthly demand by invoice, an amount
equal to one hundred ten percent (110%) of Landlord's actual or reasonably
estimated cost for providing off-hour and nonstandard air conditioning, heating
and electricity service to the Premises. Such after hours service will be
available by card access or key pad.

         5.03 SERVICE INTERRUPTION. To the extent any of the services described
above require electricity, gas, water or other services supplied by public
utilities, Landlord's covenants hereunder shall impose on Landlord only the
obligation to use its good faith efforts to cause the applicable public
utilities to furnish the same. Any failure or defect in the services described
above shall not be construed as an eviction of Tenant nor entitle Tenant to any
reduction, abatement, offset, or refund of Rent or to any damages from Landlord.
Landlord shall not be in breach or default under this Lease, provided Landlord
uses reasonable diligence during normal business hours to restore any such
failure or defect after Landlord receives written notice thereof.





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<PAGE>   11

                                    ARTICLE 6

         6.01 ALTERATIONS. Tenant shall not make or allow to be made any
alterations, installations, additions or improvements in or to the Premises, or
place safes, vaults or other heavy furniture or equipment within the Premises,
without Landlord's prior written consent. Such consent by Landlord will not be
unreasonably withheld or delayed for interior, nonstructural alterations to the
Premises that do not require modifications to the Building HVAC or other
systems. All alterations, installations, additions or improvements, other than
movable furniture, wall systems, equipment, and trade fixtures, made by Tenant
to the Premises shall remain upon and be surrendered with the Premises and
become the property of Landlord at the expiration or termination of this Lease
or the termination of Tenant's right to possession of the Premises; provided,
however, that Landlord may require Tenant, at Tenant's cost, to remove any or
all of such items made by Tenant that are not Building Standard upon the
expiration or termination of this Lease or the termination of Tenant's right to
possession of the Premises. Tenant, at its sole cost and prior to the expiration
or termination of this Lease, shall remove all of Tenant's property from the
Premises and make, or reimburse Landlord for the cost of all repairs to the
Premises and/or Project for damage resulting from such removal. Tenant is not
required, however, to remove any Initial Tenant Improvements or any subsequent
alterations approved by Landlord. All work shall be completed promptly and in a
good and workmanlike manner and shall be performed in such a manner that no
mechanic's, materialman's or other similar liens shall attach to Tenant's
leasehold estate, and in no event shall Tenant permit, or be authorized to
permit, any such liens or other claims to be asserted against Landlord or
Landlord's rights, estate and interests with respect to the Project or this
Lease. If the cost of any alterations, installations, additions or improvements
to the Premises exceeds $5,000.00, Landlord may require, at Tenant's sole cost
and expense, a lien and completion bond in an amount equal to the estimated cost
of such improvements, additions or alterations Tenant proposes to make in the
Premises.

         6.02 TENANT REPAIRS. By taking possession of the Premises, Tenant shall
be deemed to have accepted the Premises as being in good, sanitary order,
condition and repair, subject to Punch List Items and latent defects. Tenant
shall, at Tenant's sole cost and expense, keep the Premises in good condition
and repair, excepting damage thereto by fire or other casualty or resulting from
causes beyond the reasonable control of Tenant and further excepting ordinary
wear and tear. Other than as herein provided to the contrary with respect to
damages resulting from fire or other insurable casualties, any injury or damage
to the Premises or Project, or the appurtenances or fixtures thereof, caused by
or resulting from the negligent acts or omissions of or the intentional
misconduct of Tenant or Tenant's employees, servants, agents, invitees,
assignees, or subtenants shall be repaired or replaced by Tenant, or at
Landlord's option by Landlord, at the expense of Tenant. If Tenant fails to
maintain the Premises or fails to repair or replace any damage to the Premises
or Project resulting from the negligence or intentional act of Tenant, its
employees, servants, agents or invitees, or for which Tenant is otherwise






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<PAGE>   12

responsible by the terms of this Lease, Landlord may, but shall not be obligated
to, cause such maintenance, repair or replacement to be done, as Landlord deems
necessary, and Tenant shall immediately pay to Landlord all costs related
thereto plus a charge for overhead of ten percent (10%) of such costs.

         6.03 LANDLORD REPAIRS. Except as stipulated herein, Landlord shall not
be required to make any improvements to or repairs of any kind or character to
the Premises during the Term. However, notwithstanding any provisions of this
Lease to the contrary, all repairs, alterations or additions to the Base
Building or its systems (as opposed to those involving only Tenant's leasehold
improvements), and all repairs, alterations or additions to Tenant's
non-Building Standard leasehold improvements which affect the Building's
structural components or major mechanical, electrical or plumbing systems in the
Building, shall be made only by Landlord (or its contractor) and at commercially
competitive rates. Further, to the extent that other provisions of this Lease
would make any such repairs, alterations or additions the responsibility of
Tenant, Tenant shall pay the cost thereof (including an additional charge of ten
percent (10%) of actual direct costs for Landlord's overhead).

                                    ARTICLE 7

         7.01 LANDLORD INSURANCE. Landlord shall insure the Project and Building
against fire and other casualty and shall maintain comprehensive general
liability and other insurance in such amounts as may be required by Landlord's
mortgagee, or in such other greater commercially reasonable amounts as Landlord,
in its sole discretion, may deem appropriate. The cost of such insurance,
including any reasonable deductible paid thereunder by Landlord, shall be an
"Operating Expense" as defined in Section 3.03 hereof. Such insurance shall be
for the sole benefit of Landlord and, if required, Landlord's mortgagee. If the
annual premiums to be paid by Landlord exceed the standard rates because of
Tenant's operations within or contents of the Premises or because improvements
to the Premises are above Building Standard, Tenant shall promptly pay the
excess amount of the premium upon request by Landlord (and if necessary,
Landlord may allocate the insurance costs of the Building to give effect to this
sentence).

         7.02 TENANT INSURANCE. Tenant shall, at Tenant's expense, fully insure
its property located in the Premises against fire and other casualty and shall
maintain comprehensive general liability insurance insuring Landlord and Tenant
against any liability arising out of ownership, use, occupancy or maintenance of
the Premises and all areas appurtenant thereto, including contractual liability
insurance (with respect to Section 7.04 hereof), with insurance companies
approved by Landlord and with limits of liability of at least $2,000,000 in each
occurrence for Bodily Injury and Property Damage combined and $2,000,000 general
aggregate for Bodily Injury and Property Damage combined with the endorsement of
comprehensive general liability CG-2504. Tenant shall cause Landlord to be named
as an additional insured under such general liability policies and shall, not
less than twenty (20) days prior to (a) the




                                       11


<PAGE>   13




Commencement Date, and (b) the expiration of old policies, furnish Landlord with
certificates of insurance reasonably satisfactory to Landlord. The limit of such
insurance shall not, however, limit the liability of Tenant hereunder. Tenant
may carry such insurance under a blanket policy, provided such insurance has a
Landlord's protective liability endorsement attached thereto. If Tenant fails to
procure and maintain said insurance, Landlord may, but shall not be required to,
procure and maintain same, but at the expense of Tenant. No policy shall be
cancelable or subject to reduction of coverage except after thirty (30) days
prior written notice to Landlord.

         7.03 WAIVER OF SUBROGATION. WHENEVER (A) ANY LOSS, COST, DAMAGE OR
EXPENSE RESULTING FROM FIRE, EXPLOSION OR ANY OTHER CASUALTY OR OCCURRENCE IS
INCURRED BY EITHER OF THE PARTIES TO THIS LEASE IN CONNECTION WITH THE PREMISES
OR THE PROJECT, AND (B) SUCH PARTY IS THEN COVERED (OR IS REQUIRED UNDER THIS
LEASE TO BE COVERED) IN WHOLE OR IN PART BY INSURANCE WITH RESPECT TO SUCH LOSS,
COST, DAMAGE OR EXPENSE, THEN NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN
CONTAINED, THE PARTY SO INSURED (OR REQUIRED TO BE INSURED), FOR ITSELF AND ANY
INSURER OR ANYONE ELSE THAT MIGHT OTHERWISE CLAIM THROUGH IT BY WAY OF
SUBROGATION, HEREBY RELEASES THE OTHER PARTY (EVEN IF THE OTHER PARTY IS
NEGLIGENT) FROM ANY LIABILITY THE OTHER PARTY WOULD OTHERWISE HAVE ON ACCOUNT OF
SUCH LOSS, COST, DAMAGE, AND WAIVES ANY RIGHT OF SUBROGATION WHICH MIGHT
OTHERWISE EXIST ON ACCOUNT THEREOF.

         7.04 TENANT'S INDEMNITY. Tenant hereby indemnifies, defends and holds
harmless Landlord and its respective officers, directors, employees and agents,
and Landlord's successors and assigns, and their officers, directors, employees
and agents (collectively, the "Landlord Indemnified Parties") against any and
all claims, demands, losses, liabilities, costs and expenses (including
attorneys' fees at trial and on any appeal or petition for review) incurred by
the Landlord Indemnified Parties arising from Tenant's use or occupancy of the
Premises for the conduct of its business or from any activity, work or other
thing done, permitted or suffered by Tenant on or about the Building or the
Project, and shall further indemnify defend and hold harmless the Landlord
Indemnified Parties from and against any and all claims arising from any breach
or default in the performance of any obligation on Tenant's part to be performed
under the terms of this Lease, or arising from any act or omission of, or due to
the negligence or intentional misconduct of Tenant, or any officer, agent,
employee, guest or invitee of Tenant, and from and against all costs, attorneys'
fees, expenses and liabilities incurred in or related to any such claim or any
action or proceeding brought thereon. Tenant, as a material part of the
consideration to Landlord, hereby assumes all risk of damage to property or
injury to persons including death in, upon or about the Premises, from any
cause, including without limitation, Landlord's negligence, but except for such
damage or injury caused solely by Landlord's gross negligence or willful
misconduct, and Tenant hereby waives all claims in respect thereof against
Landlord.





                                       12

<PAGE>   14

         7.05 LANDLORD'S INDEMNITY. Landlord hereby indemnifies, defends and
holds harmless Tenant and its respective officers, directors, employees and
agents, and Tenant's successors and assigns, and their officers, directors,
employees and agents (collectively, the "Tenant Indemnified Parties") against
any and all claims, demands, losses, liabilities, costs and expenses (including
attorneys' fees at trial and on any appeal or petition for review) incurred by
the Tenant Indemnified Parties arising from any accident, injury or damages
whatsoever caused to any person or the property of any person in or about the
common areas or public areas of the Building or the Project (specifically
excluding the Premises) to the extent attributable to the gross negligence or
willful misconduct of Landlord or its agents and employees.




                                       13






<PAGE>   15

                                    ARTICLE 8

         8.01 CASUALTY. Tenant shall promptly give Landlord written notice of
any fire or other casualty occurring within the Premises. If the Premises or
other parts of the Building or Project reasonably required for Tenant's use and
quiet enjoyment of the Premises are damaged by fire or other casualty then,
subject to the following provisions of this Article, Landlord shall promptly
repair the damage. If, however, the damage (a) is not covered by insurance
carried by Landlord hereunder, (b) is covered by insurance carried by Landlord
hereunder, but Landlord's mortgagee requires that proceeds of such insurance be
used to retire the mortgage debt, (c) is to such an extent that the cost of
repairs will be greater than 10% of the then full replacement cost of the
Building, or (d) occurs during the last 12 months of the then effective Term of
this Lease, then Landlord shall have the option (i) to repair the damaged
Premises and any other damaged parts of the Building or Project reasonably
necessary to Tenant's use and quiet enjoyment of the Premises to substantially
the same condition as immediately prior to such fire or other casualty, or (ii)
to terminate this Lease by so notifying Tenant within sixty (60) days after the
date of such damage, such termination to be effective as of the date of the fire
or other casualty causing the damage. Notwithstanding the foregoing, if the
Premises are so destroyed that they cannot or will not be repaired or rebuilt
within one hundred eighty (180) days of the casualty date, Tenant shall have the
option to terminate this Lease by so notifying Landlord within thirty (30) days
after Tenant's discovery of such untentability, such termination to be effective
as of the date of fire or other casualty causing the damage. The Rent required
to be paid hereunder shall be abated in proportion to the portion of the
Premises, if any, which is rendered untenantable by fire or other casualty
hereunder from the date of the occurrence of such damage or casualty until the
repairs specified in clause (i) of the preceding sentence are completed. Other
than such rental abatement, no damages, compensation or claims shall be payable
by Landlord for loss of the use of the whole or any part of the Premises,
Tenant's personal property, or any inconvenience, loss of business, or annoyance
arising from any such repair and reconstruction. Landlord shall not be required
to repair or replace any furniture, furnishings, or other personal property that
Tenant may be entitled to remove from the Premises or any alterations to the
Premises constructed and installed by or for Tenant pursuant to Section 6.01
hereof or any installations in excess of Building Standard.

                                    ARTICLE 9

         9.01 CONDEMNATION. If a "substantial portion of the Premises" (as
hereinafter defined) should be taken for any public or quasi-public use, by
right of eminent domain or otherwise, or should be sold in lieu of condemnation,
then either party hereof shall have the right, at its option, to terminate this
Lease as of the date when physical possession of the Premises is taken by the
condemning authority. If less than a substantial portion of the Premises is so
taken or sold , the Rent payable hereunder shall be abated in proportion to the
portion of the Premises which is rendered untenantable by such condemnation, and
Landlord shall, to the





                                       14


<PAGE>   16




extent Landlord deems feasible, subject to the following provisions of this
Article, promptly restore the Premises and the appurtenances thereto to
substantially its former condition. As used herein, a "substantial portion of
the Premises" will mean (1) more than 20% of the rentable are of the Premises
itself, (2) any parking areas or other appurtenances to the Premises in the
Project, without which Tenant cannot continue to operate its business in a
reasonably normal manner, (3) any part of the Project, after the taking of which
(or sale in lieu thereof), Landlord is unable or unwilling to promptly restore
the remainder of the Project for any reason (including any shortage of
condemnation or sales proceeds available to Landlord or any refusal of
Landlord's mortgagee, ground lessor or other secured party, to give consents
necessary for such restoration). If any substantial part of the Project other
than the Premises may be so taken or sold, Landlord shall have the right at its
option to terminate this Lease as of the date when physical possession of such
part of the Project is taken by the condemning authority. All amounts awarded
upon taking of any part or all of the Project or the Premises shall belong to
Landlord and Tenant shall not be entitled to, and expressly assigns all claims,
rights and interests to, any such compensation to Landlord. If available, Tenant
shall have the right to pursue separately against the condemning authority any
award available separately to Tenant for Tenant's moving and relocation
expenses, rent differentials, brokerage and attorneys' fees, unamortized
improvements (including furnishings) made and paid solely by Tenant, if any, the
value, if any, of Tenant's options of renewal, first refusal, and expansion as
granted pursuant to Sections 2.03, 2.04, and 2.05, respectively, and other
expenses or costs of Tenant reasonably related to such taking or condemnation;
provided, however, in no event shall any such award to Tenant reduce or limit
the condemnation award payable to Landlord by the condemning authority, and to
the extent any award to Tenant would in any manner reduce or limit the award
otherwise payable to Landlord, such award shall be payable to Landlord.





                                       15





<PAGE>   17



                                   ARTICLE 10

         10.01 ENTRY. Landlord, its agents, employees and representatives, shall
have the right to enter the Premises at any time during Normal Business Hours
after reasonable notice to Tenant under the circumstances (which notice may be
oral and not in compliance with Section 15.08 hereof, but no notice shall be
required in the case of emergency) to show the Premises to prospective lenders
or prospective purchasers or, within the last six (6) months of the Term, to
prospective tenants unless Tenant has renewed or extended the Term. Provided any
such entry is done in a manner that does not unnecessarily interfere with
Tenant's use or enjoyment of the Premises, Tenant hereby waives any claim for
damages or 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 occasioned thereby, except where such damages or injury are caused by
Landlord's gross negligence or willful misconduct. For each of the aforesaid
purposes, Landlord shall at all times have and retain a key with which to unlock
all of the doors in, upon and about the Premises, excluding Tenant's vaults,
safes and files. Landlord shall have the right to use any and all means which
Landlord may deem proper to open the doors in, upon and about the Premises in an
emergency in order to obtain entry to the Premises without liability to Tenant,
except for any failure to exercise due care for Tenant's property. Tenant shall
have 24-hour access to the Building and the Premises by card access system

                                   ARTICLE 11

         11.01 SUBORDINATION. Subject to the nondisturbance provisions in the
next Section, this Lease is and shall be subject and subordinate to any and all
ground or similar leases affecting the Project, and to all mortgages, deeds of
trust, and security agreements that may now or hereafter encumber or affect the
Project or any interest of Landlord therein and/or the contents of the Building,
and to any advances made on the security thereof and to any and all increases,
renewals, modifications, consolidations, replacements and extensions of any such
leases, mortgages, deeds of trust and/or security agreements. This clause shall
be self-operative and no further instrument of subordination need be required by
any owner or holder of such ground lease, mortgage, deed of trust or security
agreement. Tenant agrees to execute and return any estoppel certificate, consent
or agreement reasonably requested by any such lessor, mortgagee, trustee or
secured party in connection with this Section within ten (10) days after
Tenant's receipt of same, Tenant's receipt being governed by Section 15.08 of
this Lease. Any breach of the preceding sentence by Tenant shall constitute a
"Default" hereunder. If any mortgagee of Landlord secured by a lien on the
Project, any lessor to Landlord under a ground lease of the Project, or any
secured party under a security agreement encumbering the interest of Landlord
shall request it and provide Tenant with an address for notices, Tenant shall
provide to such mortgagee, lessor or secured party written notice of any default
or breach by Landlord at least thirty (30) days prior to the exercise by Tenant
of any rights and/or remedies of Tenant hereunder






                                       16



<PAGE>   18




arising out of such default or breach. Provided Tenant is not in default
hereunder, within ten (10) days following receipt of a written request therefor,
Landlord agrees to execute and return any estoppel certificate, consent or
agreement reasonably requested by Tenant or any mortgagee, trustee, or secured
party reasonably interested in the Premises.

         11.02 NONDISTURBANCE AND ATTORNMENT. If any ground or similar such
lease, mortgage, deed of trust or security agreement is enforced by the ground
lessor, the mortgagee, the trustee, or the secured party, Tenant shall, upon
request, attorn to the lessor under such lease or the mortgagee or purchaser at
such foreclosure sale, or any person or party succeeding to the interest of
Landlord as a result of such enforcement, as the case may be, and execute
instrument(s) confirming such attornment; provided, however, that regardless of
whether this Lease was approved and accepted in writing by such lessor,
mortgagee, trustee or secured party, Tenant's attornment and the rights of the
lessor, mortgagee, trustee or secured party (or anyone else claiming through
them) shall be conditioned upon the agreement by such successor to Landlord's
interest not to disturb Tenant's possession or other rights hereunder during the
Term so long as Tenant performs its obligations under this Lease. In the event
of such enforcement and upon Tenant's attornment as aforesaid, Tenant will
automatically become the tenant of the successor to Landlord's interest without
change in the terms or provisions of this Lease; provided, however, that such
successor to Landlord's interest shall not be (a) bound by any payment of Rent
for more than one month in advance (except prepayments for security deposits, if
any), or (b) bound by any amendments or modifications of this Lease made without
the prior written consent of the applicable mortgagee or secured party after
Tenant has been notified of its name and address, or (c) subject to liability or
offset for any damages Tenant may claim because of a default by Landlord
hereunder prior to the date Landlord's interest in the Building is conveyed to
such successor of Landlord.

         11.03 QUIET ENJOYMENT. Tenant, on paying the Rent and keeping and
performing the conditions and covenants herein contained, shall and may
peaceably and quietly enjoy the Premises for the Term, subject to Sections 11.01
and 11.02, all applicable laws and other governmental and legal requirements and
the provisions of this Lease. It is understood and agreed that this covenant and
any and all other covenants of Landlord contained in this Lease shall be subject
to the penultimate sentence of Section 15.07.





                                       17


<PAGE>   19

                                   ARTICLE 12

         12.01 ASSIGNMENT AND SUBLETTING. Tenant shall have the right, without
Landlord's consent, to assign this Lease in its entirety, or to sublet all or
any part of the Premises to (a) a subsidiary or affiliate of Tenant; (b) any
partnership succeeding to the business and assets of Tenant; or (c) a successor
entity created by merger, reorganization, recapitalization, or acquisition. For
purposes of this Section, the word "affiliate" shall mean an entity, directly or
indirectly, through one or more intermediaries, controlled by Tenant or under
common control with Tenant, or by Tenant's parent company. Except as set forth
above, Tenant shall not, voluntarily, by operation of law, or otherwise, assign,
transfer, mortgage, pledge, or encumber this Lease or sublease the Leased
Premises or any part thereof, or suffer any person other than Tenant, its
employees, agents, servants and invitees to occupy or use the Leased Premises or
any portion thereof without the express prior written consent of Landlord which
consent shall not be unreasonably withheld; provided, however, any such assignee
or sublessee must be creditworthy, must use the Leased Premises for the specific
uses set forth in Article 4, must not be a type a type or class of tenant that
would reduce the value of the Project as a first class office building project,
and Landlord shall not be required to give its consent to a sublease or
assignment that would result in a breach by Landlord of any of its lease
obligations to other tenants. Any attempt to do any of the foregoing without
such written consent shall be null and void and of no effect, and shall further
constitute a default under this Lease. If Tenant so requests Landlord's consent,
said request shall be in writing specifying the identity of the proposed
transferee, the duration of said desired sublease or assignment, the date same
is to occur, the exact location of the space affected thereby and the proposed
rentals on a square foot basis chargeable thereunder, and shall be submitted to
Landlord at least fifteen (15) days in advance of the date on which Tenant
desires to make such assignment or sublease or allow such occupancy or use. Upon
such request Landlord may, in its reasonable discretion, (a) grant such consent
subject to Landlord's approval of the assignee, transferee, subtenant, or
mortgagee, or (b) deny such consent, which denial shall not be effective unless
Landlord provides Tenant with a written explanation of the reason(s). If
Landlord does not give such consent in writing within ten (10) days of the date
such consent is requested, then Landlord's consent shall be deemed to have been
granted. In no event may Tenant assign this Lease or sublease the Leased
Premises or any portion thereof to any party whose operations in the Project
would not be in keeping with, or would detract from, the operations of other
tenants in the Project.

         In any situation in which Landlord consents to an assignment or
sublease hereunder, Tenant shall promptly deliver to Landlord a fully executed
copy of the final sublease agreement or assignment instrument and all ancillary
agreements relating thereto. No assignment shall be effective unless the
assignee has agreed within the assignment instrument to assume the obligations
of Tenant hereunder and to be personally bound by all of the covenants, terms
and conditions hereof on the part of Tenant to be performed or observed
hereunder.





                                       18


<PAGE>   20

         12.02 CONTINUED LIABILITY. Tenant shall, despite any permitted
assignment or sublease, remain directly and primarily liable for the performance
of all of the covenants, duties, and obligations of Tenant hereunder, and
Landlord shall be permitted to enforce the provisions of this Lease against
Tenant or any assignee or sublessee without demand upon or proceeding in any way
against any other person.

         12.03 CONSENT. Consent by Landlord to a particular assignment or
sublease shall not be deemed a consent to any other or subsequent transaction.
If this Lease is assigned or if the Premises are subleased without the
permission of Landlord, then Landlord may nevertheless collect Rent from the
assignee or sublessee and apply the net amount collected to the Rent payable
hereunder, but no such transaction or collection of Rent or application thereof
by Landlord shall be deemed a waiver of any provision hereof or a release of
Tenant from the performance of the obligations of the Tenant hereunder.

         12.04 PROCEEDS. All cash or other proceeds of any assignment or
sublease of Tenant's interest in this Lease and/or the Premises, whether
consented to by Landlord or not, in excess of the rentals called for hereunder,
shall be paid first to pay all reasonable out-of-pocket costs and expenses paid
by Tenant related to such sublease or assignment of the Premises, including
leasing commission and tenant improvements costs, and thereafter, fifty percent
(50%) of such excess rentals shall be paid to Landlord and fifty percent (50%)
shall be paid to Tenant, unless Tenant is in default hereunder, in which event
all excess rentals shall be paid to Landlord during the continuance of such
default. After the payment of all reasonable out-of-pocket costs and expenses
related to such sublease or assignment, Tenant hereby covenants and agrees to
pay to Landlord fifty percent (50%) of all rent and other consideration which it
receives which is in excess of the rent payable hereunder within ten (10) days
following receipt thereof by Tenant; provided that during the occurrence of an
event of default hereunder by Tenant, Tenant covenants to pay to Landlord one
hundred percent (100%) of such excess rentals within ten (10) days following
receipt thereof by Tenant. This covenant and assignment shall benefit Landlord
and its successors in ownership of the Building and shall bind Tenant and
Tenant's heirs, executors, administrators, personal representatives, successors
and assigns. In addition to any other rights and remedies which Landlord may
have hereunder, at law or in equity, in the event Tenant has failed to pay any
rent due hereunder on or before five (5) days following the date on which it is
due, Landlord shall have the right to contact any assignee and require that from
that time forward all payments made pursuant to the assignment shall be made
directly to the Landlord. Any assignee or sublessee of Tenant's interest in this
Lease (all such assignees or sublessees being hereinafter referred to as
"Successors"), by occupying the Premises and/or assuming Tenant's obligations
hereunder, shall be deemed to have assumed liability to Landlord for all amounts
paid to persons other than Landlord by such Successors in consideration of any
such assignment in violation of the provisions hereof.




                                       19


<PAGE>   21

                                   ARTICLE 13

         13.01    DEFAULT. Each of the following shall constitute a "Default" by
                  Tenant:

         (a)      The failure of Tenant to pay the Rent or any part thereof when
                  due and the continuation of such failure for five days after
                  Tenant is notified in writing thereof; provided, however, that
                  if Tenant fails to make any payment required by this Lease
                  when due two (2) or more times in any Lease Year, then
                  notwithstanding that such defaults have been cured by Tenant,
                  any further similar failure shall be deemed a Default without
                  notice or opportunity to cure;

         (b)      Tenant shall become insolvent or unable to pay its debts as
                  they become due, or Tenant notifies Landlord that it
                  anticipates either condition;

         (c)      Tenant takes any action to, or notifies Landlord that Tenant
                  intends to, file a petition under any section or chapter of
                  the United States Bankruptcy Code, as amended from time to
                  time, or under any similar law or statute of the United States
                  or any state thereof; or a petition shall be filed against
                  Tenant under any such statute or Tenant notifies Landlord that
                  it knows such a petition will be filed; or the appointment of
                  a receiver or trustee to take possession of substantially all
                  of Tenant's assets located at the Premises or of Tenant's
                  interest in this Lease; or 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;
                  unless the application of this subsection 13.01(c) shall
                  contravene any applicable law;

         (d)      Tenant shall fail to fulfill or perform, in whole or in part,
                  any of its obligations under this Lease (other than the
                  payment of Rent) and such failure or nonperformance shall
                  continue for a period of fifteen (15) days after written
                  notice thereof has been given by Landlord to Tenant; but if
                  the failure is of a nature that it cannot be cured within such
                  15-day period, Tenant shall not have committed a Default if
                  Tenant commences the curing of the failure within such 15-day
                  period and thereafter diligently pursues the curing of same
                  and completes the cure within thirty (30) days;

         (e)      Tenant shall fail to take possession of the Premises within
                  ninety (90) days after the Commencement Date;

         (f)      Tenant shall vacate or abandon the Premises or any significant
                  portion thereof for a period in excess of ninety (90) days,
                  except in connection with an assignment or sublease of the
                  Premises or a significant portion thereof approved by Landlord
                  or

                                       20

<PAGE>   22

                  an abandonment or vacation otherwise approved by Landlord, in
                  its sole discretion; and

         (g)      The occurrence of any event or condition having a material and
                  adverse effect on the assets, liabilities, financial
                  condition, business or operations of Tenant as they exist on
                  the date of this Lease, or the ability of the Tenant to meet
                  its obligations under this Lease on timely basis;

         (h)      Any representation or warranty by Tenant in this Lease, or any
                  certificate or other document furnished by Tenant to induce
                  Landlord to enter into this Lease, including without
                  limitation, financial information, proves to be incorrect in
                  any material respect.

         13.02 RIGHTS UPON DEFAULT. If a Default by Tenant occurs, then at any
time thereafter, with or without notice or demand, Landlord may exercise any and
all rights and remedies available to Landlord under this Lease, at law or in
equity, statutory or at common law, including without limitation, termination of
this Lease and termination of Tenant's right to possession without terminating
the Lease. In the event of a Default, Landlord may, without additional notice
and without court proceedings, re-enter and repossess the Premises and remove
all persons and property therefrom, and Tenant hereby agrees to surrender
possession of the Premises, waives any claim arising by reason thereof or by
reason of issuance of any distress warrant or writ of sequestration, and agrees
to hold Landlord harmless from any such claims. If Landlord elects to terminate
this Lease, it may treat the Default as an entire breach of this Lease and
Tenant shall immediately become liable to Landlord for damages equal to the
total of (a) the cost of recovering, reletting, including, without limitation,
the cost of leasing commissions attributable to the unexpired portion of the
Term of this Lease, and remodeling of the Premises for a normal and customary
office tenant, (b) all unpaid Rent and other amounts earned or due through such
termination, including interest thereon at the rate specified in Section 13.04
hereof, plus (c) the present value (discounted at the rate of eight percent (8%)
per annum) of the balance of the Rent for the remainder of the Term less the
present value (discounted at the same rate) of the fair market rental value of
the Premises for said period and (d) any other sum of money and damages owed by
Tenant to Landlord. If Landlord elects to terminate Tenant's right to possession
of the Premises without terminating this Lease, Landlord may (but shall not be
obligated to) rent the Premises or any part thereof for the account of Tenant to
any person or persons for such rent and for such terms and conditions as
Landlord reasonably deems appropriate, and Tenant shall be liable to Landlord
for the amount, if any, by which the Rent for the unexpired balance of the Term
exceeds the net amount, if any, received by Landlord from such reletting, being
the gross amount so received by Landlord less the costs of repossession,
reletting, remodeling, and other expenses incurred by Landlord. Such sum or sums
shall be paid by Tenant in monthly installments on the first day of each month
of the Term. In no case shall Landlord be liable for failure to relet the
Premises or to collect the rent due under such reletting,

                                       21

<PAGE>   23

and in no event shall Tenant be entitled to more than 50% of any excess rents
received by Landlord. All rights and remedies of Landlord shall be cumulative
and not exclusive. Landlord shall use commercially reasonable efforts to
mitigate Tenant's damages in the event of Tenant's default.

         13.03 COSTS. If a Default by Tenant occurs, then Tenant shall reimburse
Landlord on demand for all costs reasonably incurred by Landlord in connection
therewith including, but not limited to, reasonable attorney's fees, court
costs, and related costs, plus interest thereon from the date such costs are
paid by Landlord until Tenant reimburses Landlord, at the rate specified in
Section 13.04 hereof.

         13.04 INTEREST. All late payments of Rent, costs or other amounts due
from Tenant under this Lease shall bear interest from the date due until paid at
the rate of eighteen percent (18%) per annum; provided, however, in no event
shall the rate of interest hereunder exceed the maximum non-usurious rate of
interest (the "Maximum Rate") permitted by the applicable laws of the State of
Texas or the United States of America, whichever shall permit the higher
non-usurious rate, and as to which Tenant could not successfully assert a claim
or defense of usury.

         13.05 INTENTIONALLY OMITTED

         13.06 SECURITY DEPOSIT. Upon the execution of this Lease, Tenant shall
deposit with Landlord $88,333.00 as a security deposit (the "Security Deposit").
The Security Deposit shall be held by Landlord without liability for interest
and as security for the performance by Tenant of Tenant's covenants and
obligations under this Lease, it being expressly understood that the Security
Deposit shall not be considered an advance payment of rent or a measure of
Tenant's liability for damages in case of Default by Tenant. Landlord shall have
no fiduciary responsibilities or trust obligations whatsoever with regard to the
Security Deposit and shall not assume the duties of a trustee for the Security
Deposit. Landlord may, from time-to-time, without obligation and without
prejudice to any other remedy and without waiving such Default, use the Security
Deposit to the extent necessary to cure any Default of Tenant hereunder;
provided, however, Landlord has no obligation to use the Security Deposit to
cure any Default of Tenant. Following any such application of the Security
Deposit, Tenant shall pay to Landlord on demand in cash the amount so applied in
order to restore the Security Deposit to its original amount. If Tenant is not
in Default at the termination of this Lease, the balance of the Security Deposit
remaining after any such application shall be returned by Landlord to Tenant. If
Landlord transfers its interest in the Premises during the term of this Lease,
and the transferee accepts all legal obligations of Landlord under the Lease,
Landlord may assign the Security Deposit to the transferee and thereafter shall
have no further liability for the return of such Security Deposit. Tenant agrees
to look solely to such transferee or assignee or successor thereof for the
return of the Security Deposit. Landlord and its successors and assigns shall
not be bound by any actual or attempted assignment or encumbrance of the
Security Deposit by Tenant.

                                       22

<PAGE>   24


Tenant, at its option, may substitute a letter of credit for the cash Security
Deposit; provided, however, such letter of credit must be in a form and content
acceptable to Landlord, in its sole and absolute discretion.

         13.07 NON-WAIVER. The failure of Landlord or Tenant to seek redress for
violation of, or to insist upon the strict performance of, any covenant or
condition of this Lease shall not prevent a subsequent act or omission that
would have originally constituted a violation of this Lease from having all the
force and effect of an original violation. The receipt by Landlord of Rent with
or without knowledge of the breach of any provision of this Lease shall not be
deemed a waiver of such breach, shall not reinstate this Lease or Tenant's right
of possession if either or both have been terminated, and shall not otherwise
affect any notice, election, action, or suit by Landlord. No provision of this
Lease shall be deemed to have been waived unless such waiver is in writing
signed by the waiving party. No act or thing done by Landlord during the Term
shall be deemed an acceptance of a surrender of the Premises and no agreement to
accept such surrender shall be valid, unless express and in writing signed by
Landlord.

                                   ARTICLE 14

         14.01 FINANCIAL STATEMENTS. Within sixty (60) days after the end of
each fiscal year of Tenant, or as may be requested from time to time by
Landlord, Tenant shall deliver to Landlord current financial statements,
including, without limitation, balance sheets, profit and loss statements,
reconciliations of capital and surplus, changes in financial condition,
schedules of sources and applications of funds, and operating statements with
respect to the business of Tenant, all of which shall, at the request of
Landlord, be certified by an independent certified public accountant.

         14.02 EVIDENCE OF AUTHORITY. Simultaneously with the execution and
delivery of this Lease, Tenant shall deliver a fully executed Certificate of the
Secretary, with attached Resolutions of its corporate board, indicating the
authority of the person executing this Lease on behalf of Tenant, substantially
in the form attached hereto as Exhibit "H".

                                   ARTICLE 15

         15.01 AMENDMENT. Any agreement hereafter made between Landlord and
Tenant shall be ineffective to modify, release, or otherwise affect this Lease,
in whole or in part, unless such agreement is in writing and signed by the party
to be bound thereby.

         15.02 SEVERABILITY. If any term or provision of this Lease shall, to
any extent, be held invalid or unenforceable by a final judgment of a court of
competent jurisdiction, the remainder of this Lease shall not be affected
thereby.


                                       23

<PAGE>   25

         15.03 ESTOPPEL LETTERS. Tenant shall promptly upon request from
Landlord execute and acknowledge a certificate containing such information as
may be reasonably requested for the benefit of Landlord, any prospective
purchaser or any current or prospective mortgagee of all or any portion of the
Project. Landlord shall promptly upon request from Tenant execute and
acknowledge a certificate containing such information as may be reasonably
requested for the benefit of Tenant, any prospective transferee or any current
or prospective mortgagee of all or any portion of the Premises.

         15.04 LANDLORD'S LIABILITY AND AUTHORITY. The liability of Landlord to
Tenant for any default by Landlord under the terms of this Lease shall be
limited to the interest of Landlord in the Building, it being intended that
Landlord, its officers, directors and employees shall not be personally liable
for any judgment or deficiency. Whenever in this Lease there is imposed upon
Landlord or Tenant the obligation to use its best efforts, reasonable efforts,
diligence or act in good faith, Landlord or Tenant, as the case may be, shall be
required to do so only to the extent the same is economically feasible and
otherwise will not impose upon Landlord extreme burdens, financial or otherwise.

         15.05 HOLDOVER. If Tenant shall remain in possession of the Premises
after the Expiration Date or earlier termination of this Lease, then Tenant
shall be deemed a tenant-at-will whose tenancy is terminable at any time. In
such event, Tenant shall pay Rent at 150% the daily Rent prevailing on the date
of such termination or expiration for the first ninety (90) days of such
holdover, and 200% the daily Rent prevailing on the date of such termination or
expiration thereafter, but otherwise shall be subject to all of the obligations
of Tenant under this Lease. Additionally, Tenant shall pay to Landlord all
damages sustained by Landlord on account of such holding over by Tenant.

         15.06 SURRENDER. Upon the expiration or earlier termination of the
Term, Tenant shall peaceably quit and surrender the Premises in the condition
required by Sections 6.01 and 6.02 hereof. All obligations of Tenant for the
period of time prior to the expiration or earlier termination of the Term shall
survive such expiration or termination.

         15.07 PARTIES AND SUCCESSORS. Subject to the limitations and conditions
set forth elsewhere herein, this Lease shall bind and inure to the benefit of
the respective heirs, legal representatives, successors, and permitted assigns
and/or sublessees of the parties hereto. The term "Landlord", as used in this
Lease, so far as the performance of any covenants or obligations on the part of
Landlord under this Lease are concerned, shall mean only the owner of the
Project at the time in question, so that in the event of any transfer of title
to the Project, the party by whom any such transfer is made shall have no
liability for a breach of any obligations of the Landlord under this Lease after
the date of such transfer, and the party to whom any such transfer is made shall
have no liability for any breach of the obligations of the Landlord under this
Lease before the date of the transfer. Landlord shall have the right to
transfer, sell, assign,

                                       24

<PAGE>   26


mortgage or encumber, in whole or in part, all of its rights and obligations
hereunder and in the Building, the Land, the Project and other property of
Landlord referred to herein.

         15.08 NOTICE. Except as otherwise provided herein, any statement,
notice, demand or other communication provided for or required to be given
pursuant to this Lease shall be in writing and served on the parties at the
addresses listed below. Any notice shall be either (a) personally delivered to
the address set forth below, in which case it shall be deemed delivered on the
date of delivery to the addressee; or (b) sent by registered or certified
mail/return receipt requested, in which case it shall be deemed delivered three
(3) business days after deposited in the U.S. Mail; (c) sent by a nationally
recognized overnight courier, in which case it shall be deemed delivered one (1)
business day after deposit with such courier; or (d) sent by telecommunications
("Fax") in which case it shall be deemed delivered on the day sent, provided an
original is received by the addressee by hand delivery or by a nationally
recognized overnight courier within one (1) business day of the Fax. The
addresses and Fax number listed herein may be changed by written notice to the
other parties, provided, however, that no notice of a change of address or Fax
number shall be effective until date of delivery of such notice. Copies of
notice are for informational purposes only and a failure to give or receive
copies of any notice shall not be deemed a failure to give notice. For purposes
of notice, the addresses of the parties shall be as follows:

         If to Landlord:       Investors Life Insurance Company of North America
                               Attn:  James M. Grace
                               701 Brazos, Suite 1400
                               Austin, Texas 78701
                               Facsimile No. (512) 404-5051


         If to Tenant:         eLoyalty Corporation
                               Attn: Tony Lapetina
                               Suite 1000
                               1050 Winter Street
                               Waltham, Massachusetts 02451
                               Facsimile No.  (781) 530-3638

                               and

                               eLoyalty Corporation
                               Attn: Susan Seah, Esq.
                               150 North Field Drive
                               Lake Forest, Illinois 60045

                                       25

<PAGE>   27


         15.09 RULES AND REGULATIONS. Tenant, its servants, employees, agents,
visitors, invitees, and licensees, shall observe faithfully and comply strictly
with the Rules and Regulations set forth in Exhibit "I" hereto, and shall abide
by and conform to such further reasonable non-discriminatory Rules and
Regulations as Landlord may from time to time make, amend or adopt, after Tenant
receives a copy thereof.

         15.10 CAPTIONS. The captions in this Lease are inserted only as a
matter of convenience and for reference and they in no way define, limit, or
describe the scope of this Lease or the intent of any provision hereof.

         15.11 NUMBER AND GENDER. All genders used in this Lease shall include
the other genders, the singular shall include the plural, and the plural shall
include the singular, whenever and as often as may be appropriate.

         15.12 GOVERNING LAW. This Lease shall be governed by and construed in
accordance with the laws of the State of Texas.

         15.13 INABILITY TO PERFORM. Notwithstanding Section 15.18 hereof,
whenever a period of time is herein prescribed for the taking of any action by
Landlord or Tenant, such party shall not be liable or responsible for, and there
shall be excluded from the computation of such period of time, any delays due to
strikes, riots, acts of God, shortages of labor or materials, war, governmental
laws, regulations or restrictions, or any other cause whatsoever beyond the
control of such party (financial inability or hardship excepted), and such
nonperformance or delay in performance shall not constitute a breach or default
by such party under this Lease nor give rise to any claim against such party for
damages or constitute a total or partial eviction, constructive or otherwise:
provided, however, this provision shall not excuse any delay in, or extend the
time periods set forth herein for Landlord's or Tenant's making of payments
required by this Lease.

         15.14 USE OF NAME. Tenant shall not, except to designate Tenant's
business address (and then only in a conventional manner and without emphasis or
display), use the name or mark "River Place Pointe" or "River Place Pointe II"
for any purpose whatsoever.

         15.15 BROKERS. Tenant represents and warrants that only brokers Tenant
has dealt with in connection with this lease are Greg Johnston of Colliers
Oxford Commercial, Inc. and Michael J. Burns of Burns & Company, which represent
Tenant, and S. Tim Casey of FIC Realty Services, Inc., which represents
Landlord. Tenant also represents that, insofar as Tenant knows, no other brokers
negotiated this Lease or are entitled to any commission in connection herewith.
Tenant shall indemnify and hold harmless Landlord from and against all claims
(and costs of defending against and investigating such claims) of any other
brokers or similar parties claiming under Tenant in connection with this Lease.
The brokers acknowledge and agree that they have entered into Leasing Commission
Agreements with Landlord, and such Leasing Commission

                                       26

<PAGE>   28

Agreements govern the payment of commissions to the brokers in this transaction.
The brokers further acknowledge and agree that the commissions provided for
under the Leasing Commission Agreement are not earned until this Lease has been
fully executed by all parties hereto, and one-half (1/2) of the commission is
payable upon the full execution of the Lease by all parties hereto, and the
remaining one-half (1/2) of the commission is payable upon Tenant's occupancy of
the Premises and the payment of the first months rent by Tenant.

         15.16 PARKING. Tenant shall have the right to use the parking
facilities of the Building, including the visitor parking spaces, subject to the
rules and regulations for such parking facilities as set forth in Exhibit "I"
hereto. Tenant shall be entitled to one (1) parking space per 250 rentable
square feet contained in the Premises, such parking spaces to be surface parking
spaces and spaces in the Project as determined by Landlord. In addition, for a
period of sixty (60) days from the Commencement Date, Tenant shall be entitled
to lease a proportionate number of executive parking spaces located beneath the
Building (based on the ratio of the rentable square feet in the Premises bears
to the total rentable square feet in the Building applied to the total number of
executive parking spaces located under the Building) at an additional cost of
$100.00 per space per month, and such amounts shall be in addition to the Rent.
After the expiration of sixty (60) days from the Commencement Date, executive
parking spaces may only be leased by Tenant on a space available basis, and the
leasing of such executive parking spaces shall be subject to the sole and
absolute discretion of the Landlord. Any executive parking spaces leased by
Tenant shall be counted against the 1 space to 250 rentable square feet
allocation set forth above. Tenant shall comply with all traffic, security,
safety and other rules and regulations concerning parking as are reasonably
promulgated from time to time by Landlord. Tenant shall indemnify and hold
harmless Landlord from and against all claims, losses, liabilities, damages,
costs and expenses (including, but not limited to, attorneys' fees and court
costs) arising out of Tenant's use of any such parking spaces, whether or not
caused or alleged to be caused by Landlord's negligence.

         15.17 SIGNAGE. Interior signage, suite identity and lobby directories
will be provided by Landlord, and Tenant will have access to the Building
directory for its signage, consistent with the Building directory signage
adopted by Landlord. In addition, if Landlord installs a monument sign for the
Building, Tenant shall have non-exclusive access to such Building monument sign,
such signage to be approved by Landlord, which approval shall not be
unreasonably withheld, as long as any such monument signage is consistent with
the monument signage in the Project. Landlord is under no obligation to install
a monument sign at the Building.

         15.18    TIME OF  ESSENCE.  Time is of the  essence  of this Lease and
each and all of its provisions in which performance is a factor.


                                       27

<PAGE>   29

         15.19 TENANT TAXES. Tenant shall pay, or cause to be paid, before
delinquency, any and all taxes levied or assessed and which become payable
during the Term upon all of Tenant's non-Building Standard leasehold
improvements and all of Tenant's equipment, furniture, fixtures and personal
property located in the Premises.

         15.20 ATTORNEY'S FEES. In the event either party defaults or is alleged
to have defaulted in the performance of any of the terms, agreements or
conditions contained in this Lease and the other party places the enforcement of
this Lease, or any part thereof, or the collection of any amount due or to
become due hereunder, or recovery of the possession of the Premises, in the
hands of any attorney who files suit upon the same, the prevailing party in the
suit shall be entitled to recover its reasonable attorney's fees from the other
party.

         15.21 LANDLORD ALTERATIONS OR MODIFICATIONS. Subject to the other
provisions hereof, Landlord expressly reserves the right in its sole discretion
to temporarily or permanently change the location of, close, block or otherwise
alter any entrances, corridors, skywalks, tunnels, doorways, or walkways leading
to or providing access to the Building or any part thereof or otherwise restrict
the use of same, provided such acts do not materially and adversely impair
Tenant's access to the Premises, do not detract from the appearance of the
Premises, and do not otherwise interfere with Tenant's use and enjoyment of the
Premises. Landlord shall not incur any liability whatsoever to Tenant as a
consequence of acts authorized by this provision, and such acts shall not be
deemed to be a breach of any of Landlord's obligations hereunder. Landlord
agrees to exercise good faith in notifying Tenant within a reasonable time in
advance of any alterations, modification or other acts of Landlord under this
Section.

         15.22 NAME CHANGE. Landlord and Tenant covenant and agree that Landlord
hereby reserves and shall have the right at any time and from time to time to
change the name of the Building as Landlord may deem advisable, and Landlord
shall not incur any liability whatsoever to Tenant as a consequence thereof,
except that Landlord shall reimburse Tenant for the reasonable costs of
replacement of Tenants stationary, signage, and the like due to such changes.
Landlord may not change the name of the Building at the request or direction of
or with the intent to place emphasis upon any tenant in the Building with less
rentable space than Tenant in the Project, unless such tenant (or a parent,
subsidiary or affiliate of such tenant) is the owner of the Building or the
Project.

          15.23 ENTIRE AGREEMENT. This Lease, including all Exhibits attached
hereto (which Exhibits are hereby incorporated herein and shall constitute a
portion hereof), contains the entire agreement between Landlord and Tenant with
respect to the subject matter hereof. Tenant hereby acknowledges and agrees that
neither Landlord nor Landlord's agents or representatives have made any
representations, warranties, or promises with respect to the Project, the
Premises, Landlord's services, or any other matter or thing except as herein
expressly

                                       28

<PAGE>   30


set forth, and no rights, easements, or licenses are acquired by Tenant by
implication or otherwise except as expressly set forth in this Lease. The taking
of possession of the Premises by Tenant shall be conclusive evidence, as against
Tenant, that Tenant accepts the Premises and the Project, and that same were in
good and satisfactory condition at the time such possession was so taken,
subject to punch list items and latent defects. Further, the terms and
provisions of this Lease shall not be construed against or in favor of a party
hereto merely because such party is the "Landlord" or the "Tenant" hereunder or
such party or its counsel is the draftsman of this Lease.

         15.24 RIGHT OF TERMINATION. Subject to the terms and conditions of
Exhibit "G" attached hereto, if Tenant timely exercises the Expansion Option and
Landlord is unable to accommodate Tenant's expansion needs (up to 16,414
rentable square feet) either (i) in the Expansion Space, or (ii) in the event
Tenant has not exercised its Right of First Refusal as to a portion of the
Expansion Space, in other space in the Building or the Project with respect to
said portion reasonably acceptable to Tenant (as more clearly illustrated at
Exhibit "G"), then Tenant shall have the right to cancel and terminate this
Lease as of May 31, 2003, by giving Landlord written notice of such election no
later than December 1, 2002; provided, however, in order for Tenant to cancel
and terminate this Lease, Tenant must pay, prior to May 31, 2003, liquidated
damages to Landlord equal to the unamortized costs incurred by Landlord in
connection with this Lease, including, but not limited to, Tenant Improvements
constructed by Landlord, Additional Tenant Improvements constructed by Landlord,
and leasing commissions.


    (REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS)











                                       29

<PAGE>   31

          EXECUTED as of the date first written above.

                                    LANDLORD:

                                    INVESTORS LIFE INSURANCE COMPANY
                                    OF NORTH AMERICA


                                    By: ____
                                    Name:
                                    Title:



                                    TENANT:

                                    eLOYALTY CORPORATION


                                    By:
                                    Name:
                                    Title:


EXHIBITS:

EXHIBIT "A":      FLOOR-PLANS
EXHIBIT "B":      LEGAL DESCRIPTION
EXHIBIT "C":      BASE BUILDING, TENANT IMPROVEMENTS AND TENANT IMPROVEMENT
                  ALLOWANCE
EXHIBIT "D":      COMMENCEMENT DATE DECLARATION
EXHIBIT "E":      RENEWAL OPTION
EXHIBIT "F":      RIGHT OF FIRST REFUSAL
EXHIBIT "G":      EXPANSION OPTION
EXHIBIT "H":      CERTIFICATE OF THE SECRETARY
EXHIBIT "I":      RULES AND REGULATIONS


                                       30


<PAGE>   32


                                   EXHIBIT "A"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                          OF NORTH AMERICA AS LANDLORD,
                       AND eLOYALTY CORPORATION, AS TENANT

                        RIVER PLACE POINTE II FLOOR-PLANS




















                                       31

<PAGE>   33


      INITIALED FOR IDENTIFICATION BY LANDLORD             AND TENANT


                                       2





<PAGE>   34



                                   EXHIBIT "B"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                          OF NORTH AMERICA AS LANDLORD
                       AND eLOYALTY CORPORATION, AS TENANT

                          LEGAL DESCRIPTION OF THE LAND


TRACT I

Lots 1-8, Block A, River Place Section 20, a subdivision in Travis County,
Texas, according to the map or plat thereof recorded in Volume 95, Pages 99-102
of the Plat Records of Travis County, Texas.

                                       AND

TRACT II

METES AND BOUNDS DESCRIPTION OF A 0.345 ACRE TRACT AS RECORDED IN VOLUME 8210,
PAGE 723 OF THE TRAVIS COUNTY DEED RECORDS, TRAVIS COUNTY, TEXAS AND BEING
LOCATED IN THE ALEXANDER DUNLAP SURVEY NO. 805, ABSTRACT 224, SAID 0.345 ACRE
TRACT BEING DESCRIBED AS FOLLOWS:

BEGINNING at 1/4-INCH iron rod found marking the northwest corner of the Charles
Webb 0.50 acre tract as recorded in Volume 7641, Page 112 of the Travis County
Deed Records. same being a re-entrant comer in the northerly one of the First
River Place Reserve Ltd. 1441.33 acre tract as recorded in Volume 11379, Page
379 of the Travis County Deed Records, and being in the northerly line of the
Banyan Payne Survey No. 288, Abstract No. 640 and the southerly line of the
Alexander Dunlap Survey No. 805, Abstract No. 224;

THENCE N 59- 34' 01" W, with the said survey line 270.92 feet to a 1/2-inch iron
rod set in the southerly line of the Bryan H. Montandon called 3.629 acre tract
as recorded in Volume 9450, Page 944 of the Travis County Deed Records, same
being the southerly line of a 100-foot wide L.C.R.A. easement as recorded in
Volume 611, Page 616 of the Travis County Deed Records, from which a 1/2-inch
iron rod found bears S 83- 01'26" W, 0.95 feet;

THENCE N 83- 01'26" E, with said southerly line of the Bryan H. Montandon tract
and the L.C.R.A. easement passing at 166.56 feet a 1-1/4 inch hex bolt found, in
all 167.29 feet to a 1/2

                                       3

<PAGE>   35

inch iron rod set in the westerly right-of-way line of Ranch to Market Road
2222, 80 foot wide at this point; THENCE with the said westerly right-of-way of
Ranch to Market Road 2222, S 27- 35' 26" E, 156.79 feet to a 1/2 inch iron rod
set at the point of curvature of a curve to the left;

THENCE southeasterly with said curve to the left and the west right-of-way line,
passing through a central angle of 04- 22' 15" to a 1/2 inch iron rod set, said
curve having a radius of 490.67 feet, an arc length of 37.43 feet and a chord
bearing S 29- 46' 47" E 37.42 feet;

THENCE departing said west right-of-way line, N 59- 34' 01" W, with the
aforementioned survey line 27.44 feet to the POINT OF BEGINNING and containing
0.345 acres of land.




                                       2

<PAGE>   36









       INITIALED FOR IDENTIFICATION BY LANDLORD             AND TENANT


                                       3


<PAGE>   37

                                   EXHIBIT "C"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                         OF NORTH AMERICA, AS LANDLORD,
                       AND eLOYALTY CORPORATION, AS TENANT

                     BASE BUILDING, TENANT IMPROVEMENTS AND
                          TENANT IMPROVEMENT ALLOWANCE

         1. Base Building. Landlord shall, at its sole cost and expense,
construct the Base Building in a good and workmanlike manner and in accordance
with all applicable laws and restrictive covenants affecting the Project. The
Base Building is specifically described in the Base Building Plans prepared by
the architectural firm Graeber, Simmons & Cowan, dated 4/12/99 and 5/28/99,
under Job No. 9816900. The Base Building Plans are incorporated herein by
reference for all purposes. The Base Building includes the foundation,
structural walls, exterior facade, exterior glass, roof, mechanical equipment
and systems, electrical systems, plumbing systems, atrium, elevator shafts, cabs
and lobbies, rest rooms, corridors required by code for building access,
Building Standard window treatments, and certain Base Building finishes as set
forth below. For purposes of this Lease, the Base Building will also be deemed
to include the allocated surface parking, allocated space within the Parking
Garage I, building loading zones, and common areas located on the Land. The Base
Building and Base Building finishes shall include the following:

         Floor:                     Exposed structural concrete slab.

         Walls:                     The interior of exterior walls and
                                    partitions separating tenant spaces from
                                    public spaces shall be taped and floated,
                                    but not finished on the Tenant side.

         Columns:                   Exterior columns shall have gypsum board
                                    furring enclosures, with taped and floated
                                    finish. All other columns shall be left
                                    exposed.

         Ceiling:                   A suspended ceiling grid system and ceiling
                                    tiles shall be provided and stacked on each
                                    floor of the Building; provided, however, if
                                    Tenant elects not to utilize the suspended
                                    ceiling grid system and ceiling tiles
                                    provided by Landlord, then Tenant shall
                                    receive a credit in the Tenant Improvement
                                    Allowance for all or such portion of the
                                    ceiling grid system and ceiling tiles, but
                                    only to the extent Landlord can reasonably
                                    use same in other portions of the Project.



                                       4

<PAGE>   38

         Lighting:                  Lighting only in public areas, no lighting
                                    in Tenant spaces; provided, however, Tenant
                                    shall receive a full credit in the Tenant
                                    Improvement Allowance of $65.00 per fixture
                                    for Building Standard 2' X 4' parabolic
                                    lay-in fluorescent light fixtures for each
                                    one hundred sixteen (116) square feet of
                                    rentable area in the Premises.

         Exit Corridors:            Code required exit corridors.

         Riser Sleeves:             Sleeves will be provided at the back of the
                                    stairwells for use by Tenant for
                                    electrical/plumbing risers, or other uses as
                                    necessary (refer to Base Building Plans and
                                    Specifications for locations).

         Mechanical:                A VAV heating, ventilating, and air
                                    conditioning system for an open floor plan
                                    is provided to each floor, with main duct
                                    runs, VAV boxes, duct connections from the
                                    main duct run to each VAV box and window
                                    slot diffusers. VAV boxes are sized to
                                    handle loads serving one person per 200
                                    square feet of rentable area and a lighting
                                    electrical load of 2.0 watts per square foot
                                    of rentable area (subject to Building
                                    standard lighting).

         Plumbing:                  There will be water and wastewater risers
                                    installed for tenant use throughout the Base
                                    Building (refer to Base Building Plans for
                                    locations). Drinking fountains will be
                                    provided in a common area adjacent to
                                    restrooms.

         Doors:                     Doors and door hardware for doors that are
                                    visible from public spaces shall be provided
                                    in accordance with the specifications
                                    contained in the Base Building Plans.

         Electrical:                Panels will be provided throughout the Base
                                    Building sized to handle normal occupant
                                    loads. Convenience outlet electrical
                                    capacity shall be 4.5 watts per square foot
                                    of rentable area demand load and 7.0 watts
                                    per square foot of rentable area connected
                                    load. One electrical room will be provided
                                    on each floor.

         Communications:            One communications closet will be installed
                                    on each floor for telephone service.


                                       2

<PAGE>   39


         Emergency System:          The Base Building emergency lighting
                                    and fire alarm system will be provided.
                                    Tenant will be responsible for code
                                    compliant life safety system in Tenant
                                    Improvements.

         Sprinklers:                A code compliant sprinkler system will be
                                    installed in the Base Building.
                                    Modifications to the base system shall be
                                    charged at the marginal increased cost of
                                    installation as part of Tenant Improvements
                                    and shall be required to meet all codes.

         Structural:                The Base Building is designed for a nominal
                                    live load of 50 psf along the Base Building
                                    perimeter and a nominal live load of 80 psf
                                    in the Base Building interior.

         Elevators:                 Two passenger elevators will be provided and
                                    finished.

         Signage:                   Signage will be provided to comply with life
                                    safety code requirements.

         Window Wall:               Window blinds in Landlord selected color at
                                    each exterior window.

         Public Restroom:           Complete men's and women's restroom
                                    facilities are provided on each floor. All
                                    restrooms meet current ADA requirements.

The Base Building Plans shall be determinative of all issues related to the Base
Building.

         2. Tenant Improvements. Prior to the Commencement Date, Landlord shall,
at its sole cost and expense (except as limited below), construct the
improvements desired by Tenant to complete the Building for Tenant's occupancy
(the "Tenant Improvements") in accordance with the Drawings (as defined below).
The cost of the Tenant Improvements shall be advanced by Landlord for the
benefit of Tenant, to be repaid by Tenant in the form of Base Rent, but only to
the extent that the aggregate cost of furnishing the Tenant Improvements does
not exceed $18.00 per rentable square foot contained in the Premises (the
"Tenant Improvement Allowance"). The Tenant Improvement Allowance shall be in
addition to the Base Building (as defined below). The following items will be
charged against the Tenant Improvement Allowance: (i) architectural,
engineering, design and space planning work in preparation of the Drawings
necessary to construct the Tenant Improvements, including all mechanical,
structural, electrical, plumbing and fire sprinkler engineering required to
develop Tenant Improvements or any modifications to the Base Building or
Building Standard requested by Tenant and approved by Landlord to accommodate
the Tenant Improvements; (ii) the total cost of the Tenant Improvements, (iii) a
charge of five percent (5%) of the total costs and expenses otherwise chargeable
for the Tenant Improvements for Landlord's construction management of the Tenant

                                       3

<PAGE>   40


Improvements (which construction management fee is payable to Landlord in lieu
of overhead or other administrative fees of Landlord itself and is exclusive of
and in addition to the general contractor's overhead and profit); (iv) Tenant's
moving costs; and (v) all other costs and expenses related to the design or
construction of the Tenant Improvements (collectively, the "Tenant Improvements
Cost"). Landlord shall keep accurate books and records related to the Tenant
Improvements Cost. Except as provided in Paragraph 6 of this Exhibit "C" below,
the Tenant Improvements Cost in excess of the Tenant Improvement Allowance shall
be paid by Tenant prior to Tenant's occupancy of the Premises.

         3. Building Standard. For purposes of this Lease, "Building Standard"
shall mean those improvements and other items as reasonably approved by Landlord
or Landlord's architect as standard for build out purposes of the Tenant
Improvements. The improvements set forth as Building Standard are part of the
Tenant Improvements and shall be charged against the Tenant Improvement
Allowance. The following shall apply unless otherwise specified in this Lease:

                  a. Ceiling System: 2' X 4' suspended lay-in acoustical
         ceiling.

                  b. Flooring: Building standard flooring will be 32 ounce
         carpet glued directly to the concrete slab.

                  c. Hardware: Polished finish Yale locksets.

                  d. Interior Doors: Solid core nine foot (9') wood veneer doors
         with hollow metal frame and latch set.

                  e. Lighting: 2' X 4' parabolic lay-in fluorescent light
         fixtures

         4. Drawings. Tenant's architect, Whitney, Inc., in consultation with
Landlord's architect, Graeber, Simmons and Cowan, as design professionals, will
prepare the plans, specifications and architectural working drawing for the
Tenant Improvements (the "Drawings"). Landlord shall have the right to
reasonably approve the Drawings. The cost of the Drawings, including costs and
expenses of both Tenant's architect and Landlord's architect, are included in
the Tenant Improvements Cost and will be applied against the Tenant Improvement
Allowance. The Drawings shall include partition and door location drawings,
telephone and electric drawings, and ceiling drawings, and include any
specifications required by Tenant, including, but not limited to, paint colors,
finish details, and non-standard construction work to be performed within the
Premises by the general contractor. Tenant shall cause Tenant's architect to
complete the Drawings within the time schedule set forth below. Landlord agrees
to promptly respond to Tenant's requests for information and approvals from time
to time as necessary to allow the Drawings to be completed by Tenant's architect
in a timely manner.


                                       4
<PAGE>   41

         5. Schedule. In order for the Leased Premises to be substantially
completed by the estimated target date of June 7, 2000, Landlord and Tenant
acknowledge and agree that it is imperative that the parties adhere to the
following schedule:

March 20, 2000 -  Drawings, including mechanical, electrical and plumbing plans
                  and specifications, all in a form and content suitable for
                  construction bidding, must be completed, approved by Landlord
                  and Tenant, and delivered to Landlord for distribution to
                  general contractors approved by Landlord and Tenant to obtain
                  bids for the cost of the Tenant Improvements

March 23, 2000 -  Approved general contractors provide to Landlord and Tenant
                  bids for the construction of the Tenant Improvements based on
                  the Drawings.

March 27, 2000 -  Tenant approves the final construction budget for the Tenant
                  Improvements and selects a general contractor, reasonably
                  acceptable to Landlord (the "General Contractor")

March 30, 2000 -  Landlord and General Contractor execute the Construction
                  Contract which contains the final approved construction budget
                  approved by Tenant.

April 3, 2000  -  Building Permit obtained and construction of Tenant
                  Improvements commences

If Tenant does not finally approve the construction budget and select the
General Contractor by March 27, 2000, the target date of June 7, 2000 shall be
automatically extended for the number of days between June 7, 2000, and the day
the Tenant approves the final construction budget and selects the General
Contractor.

         6. Additional Tenant Improvement Allowance. As set forth in Paragraph 1
of this Exhibit "C" above, the Tenant Improvement Allowance is $18.00 per
rentable square foot contained in the Premises. All Tenant Improvements Costs in
excess of the Tenant Improvement Allowance shall be paid by Tenant prior to
occupancy of the Premises. Notwithstanding the foregoing, if the Tenant
Improvements Cost is in excess of the Tenant Improvement Allowance, Landlord
agrees to provide an additional allowance not to exceed fifty percent (50%) of
the Tenant Improvements Cost in excess of the Tenant Improvement Allowance (the
"Additional Tenant Improvement Allowance"); provided, however, the Additional
Tenant Improvement Allowance, plus interest thereon at the rate of ten percent
(10%) per annum, shall be amortized over the initial Term of the Lease and added
to the Base Rent. If Tenant requests the Additional Tenant Improvement
Allowance, Tenant shall give Landlord written notice thereof prior to Tenant's
occupancy of the Premises. Prior to substantial completion of the Premises,
Landlord shall prepare and deliver to Tenant an estimate of the Tenant
Improvements Cost in excess of the



                                       5
<PAGE>   42

Tenant Improvement Allowance and the Additional Tenant Improvement Allowance
(the "Estimated Excess Costs"), and Tenant shall pay the Estimated Excess Costs
to Landlord prior to Tenant's occupancy of the Premises. Upon substantial
completion of the Tenant Improvements and the issuance of a certificate of
occupancy for the Premises by the City of Austin, Landlord shall provide Tenant
an accounting of the actual Tenant Improvements Cost, which shall include all
costs, expenses and fees related to the design and construction of the Tenant
Improvements. If the total Tenant Improvements Cost exceeds the Tenant
Improvement Allowance, the Additional Tenant Improvement Allowance, and the
Estimated Excess Costs paid by Tenant prior to occupancy, Tenant shall pay to
Landlord the excess within thirty (30) days from the date such accounting is
delivered to Tenant. If the total Tenant Improvements Cost is less than the
Tenant Improvement Allowance, the Additional Tenant Improvement Allowance, and
the Estimated Excess Costs paid by Tenant prior to occupancy, Landlord shall
refund to Tenant any surplus within thirty (30) days from the date such
accounting is delivered to Tenant. Tenant, at its expense, shall have the right
to examine all of the books and records of Landlord, the General Contractor, or
the architects in order to verify and approve the total Tenant Improvements
Cost. Once the Additional Tenant Improvement Allowance is finally determined,
Landlord shall calculate the revised Base Rent and give Tenant written notice
thereof.

         7. General Contractor. Tenant acknowledges that the general contractor
constructing the Base Building is Constructors & Associates, Inc.
("Constructors"). In order to maintain and monitor the quality of the building
construction, the design intent of the systems, including warranties,
guarantees, etc., Landlord has recommended to Tenant that all Tenant
Improvements be performed by Constructors. Tenant agrees to use Constructors for
the Tenant Improvements if Constructors is competitive in their fees, profit and
general conditions; provided, however, Tenant shall have the right to have the
Tenant Improvements competitively bid by Constructors and other general
contractors.

         8. Punch List. "Punch List Items" as used herein shall mean any details
of construction, decoration, mechanical and electrical adjustments or other
matters, which, in the aggregate, are minor in character, the non-completion of
which does not materially interfere with Tenant's use or enjoyment of the
Premises. Prior to Tenant's occupancy of the Premises, Landlord and Tenant shall
conduct a walk-though of the Premises to agree on cosmetic Punch List Items.
Within fifteen (15) days after the date Tenant takes occupancy of the Premises,
Tenant shall deliver to Landlord a current list of non-cosmetic Punch List Items
for the Premises that Landlord is obligated by the provisions of this Lease to
complete. The list of cosmetic Punch List Items and the list of non-cosmetic
Punch List Items is herein called the "Punch List". Landlord shall use
reasonable efforts to complete all Punch List Items within thirty (30) days
after the date the applicable approved Punch List is delivered by Tenant to
Landlord.

         9. Extra Work. Except as set forth herein, Landlord has no other
agreement with Tenant and has no other obligation to do any other work with
respect to the Premises. Any other

                                       6
<PAGE>   43

work in the Premises that may be permitted by Landlord pursuant to the terms and
conditions of this Lease shall be done at Tenant's sole cost and expense and
subject to Landlord's reasonable approval. If, after the commencement of
construction of the Tenant Improvements, Tenant desires to make changes in the
Drawings or desires extra work to be performed not contemplated by the Drawings
(the "Extra Work"), Tenant, at Tenant's sole cost and expense, shall submit to
Landlord all necessary drawings, plans and specifications (the "Extra Work
Drawings") to construct the Extra Work. Landlord shall have the right to
reasonably approve the Extra Work Drawings. Landlord shall submit to Tenant
written estimates of the cost of Extra Work and any delays to Substantial
Completion of the Premises resulting from Extra Work (any delays resulting from
Extra Work shall constitute a Tenant Delay as defined in Paragraph 10 below).
Landlord's estimate of the cost of the Extra Work shall include a charge of five
percent (5%) of the total expenses and costs otherwise chargeable for the Extra
Work as Landlord's construction management fee (which fee shall be exclusive of
and in addition to the General Contractor's overhead and profit). If Tenant
fails to approve Landlord's estimate within three (3) business days from the
receipt thereof, then Landlord's estimate shall be deemed disapproved in all
respects by Tenant and Landlord shall not be authorized to proceed with such
Extra Work. If Tenant timely accepts Landlord's estimate, Tenant agrees to pay
50% of the cost of the Extra Work to Landlord upon acceptance of Landlord's
estimate, and the balance of the cost of the Extra Work within ten (10) days of
being billed therefor by Landlord. All Extra Work shall be done at Tenant's sole
cost and expense and shall not be included in the Additional Tenant Improvement
Allowance. Landlord shall not be liable for any damages, nor shall the
Commencement Date be delayed, nor any Rent abated, as a result of the
construction or performance of any Extra Work or any delay in such construction
or performance.

         10. Tenant's Right of Entry Prior to Occupancy. Landlord hereby
consents to Tenant having access to all or any part of the Premises
approximately three (3) weeks prior to the anticipated Commencement Date (the
"Early Access Period") for the limited purpose of preparing the Premises for
occupancy. Such preparations shall include without limitation the installation
of computers (and peripherals), voice and data communication systems, wall and
furniture systems, and other office equipment and furnishings, subject however
to City of Austin, Texas, temporary certificate of occupancy requirements and
provided Tenant has delivered to Landlord evidence of all insurance required to
be carried by Tenant under this Lease. Landlord and Tenant agree to mutually and
reasonably cooperate with each other during the Early Access Period. Tenant
acknowledges and agrees that during the Early Access Period, Landlord may still
be in process of completing the Tenant Improvements, including, without
limitation, laying carpet. During the Early Access Period, Tenant will use
reasonable efforts to accommodate Landlord's completion of the Tenant
Improvements. Likewise, Landlord acknowledges and agrees that during the Early
Access Period, Tenant will be installing wiring, equipment and furniture and
Landlord will use reasonable efforts to accommodate Tenant's pre-occupancy
installations during the Early Access Period. Landlord acknowledges that Tenant
is not required to pay rent during the Early Access Period. During the Early
Access Period, Tenant and Tenant's

                                       7
<PAGE>   44

agents may enter the Premises, in mutual cooperation with Landlord, in order
that Tenant may do such work as may be required by Tenant to make the Premises
ready for Tenant's use and occupancy thereof. Tenant's early entry into the
Premises is conditioned upon Tenant and Tenant's agents, contractors, workmen,
mechanics, suppliers and invitees, working in harmony and not interfering with
Landlord, Landlord's agents and the General Contractor in completing the Tenant
Improvements or other tenants and occupants of the Building. If at any time such
entry shall cause or threaten to cause such disharmony or interference with the
timely completion of the Tenant Improvements, Landlord shall have the right to
withdraw Landlord's consent to Tenant's early entry of the Premises upon
twenty-four (24) hours written notice to Tenant. Tenant agrees that any such
early entry into and occupation of the Premises shall be deemed to be under all
of the terms, covenants, conditions and provisions of this Lease except as to
the covenant to pay Rent, and further agrees Landlord shall not be liable in any
way for any injury, loss or damage that may occur to any of the Tenants
Improvements or Tenant's installations made in the Premises or to properties
placed therein prior to the Commencement Date, the same being at Tenant's sole
risk. Tenant hereby indemnifies, defends and hold harmless Landlord and
Landlord's Indemnified Parties against any and all claims, demands, losses,
liabilities, costs and expenses (including reasonable attorneys' fees) arising
out of or related to Tenant's or Tenant's agents entry of the Premises prior to
substantial completion of the Premises to install its equipment and furnishings
preparatory to its occupancy of the Premises, or on account of injury to any
person whatsoever or damage to any property arising out of, in connection with
or in any way relating to Tenant's entry of the Premises prior to substantial
completion of the Premises.

         11. Tenant Delays. Tenant agrees that for purposes of this Lease, the
following shall constitute "Tenant Delays":

                  (a)      Tenant fails to timely comply with the dates
                           established in the schedule of dates described in
                           Paragraph 5 hereof, including without limitation,
                           having Tenant's architect timely complete the
                           Drawings; or

                  (b)      Tenant's failure to furnish information in accordance
                           herewith or to respond to any written request by
                           Landlord for any approval or information within any
                           time period prescribed, or if no time period is
                           prescribed, then within three (3) days of such
                           written request; or

                  (c)      Tenant's insistence on materials, finishes or
                           installations other than Landlord's Building Standard
                           after having first been informed by Landlord in
                           writing at or before the time of delivery to Tenant
                           of final construction pricing for Tenant's approval
                           that such materials, finishes or installations will
                           cause a Tenant Delay; or



                                       8
<PAGE>   45

                  (d)      Tenant's causes changes to be made in the Drawings
                           (notwithstanding Landlord's approval of such changes)
                           that reasonably would cause a delay in the completion
                           of the Premises or Tenant causes changes in the
                           Tenant Improvements after commencement of
                           construction of the Tenant Improvements resulting in
                           Extra Work; or

                  (e)      Tenant, or any person, firm or corporation employed
                           by Tenant, fails to timely perform or complete any
                           work by Tenant or said person, firm or corporation
                           employed by Tenant (all such work and such persons,
                           firms or corporations being subject to the reasonable
                           approval of Landlord); or

                  (f)      Tenant shall have directly, or indirectly through any
                           person, firm or corporation employed by Tenant,
                           interfered with or delayed the work of the General
                           Contractor; or

                  (g)      Any request by Tenant that Landlord delay the
                           completion of any of Landlord's work; or

                  (h)      Any breach or default by Tenant in the performance of
                           Tenant's obligations under this Lease; or

                  (i)      Any delay resulting from Tenant's entry of the
                           Premises prior to its being substantially completed,
                           as described in Paragraph 10 of this Exhibit "C"
                           above.

         12. Acceptance of Tenant Improvements. Except for the completion of any
Punch List Items, the taking of possession of the Premises by Tenant means that
(i) Tenant has conducted its own independent investigation of the Premises and
that the Premises are suitable for the purpose for which the same are leased,
subject to any latent defect which is not discoverable upon reasonable
inspection, and (ii) the Building and each and every part and appurtenance
thereof are in good and satisfactory condition, except for any latent defect
which is not discoverable upon a reasonable inspection.

         13. American's with Disabilities Act. Landlord, at Landlord's expense,
shall be responsible to construct the common areas, the building systems,
exterior walls and the exterior of the Building in compliance with the Americans
with Disabilities Act and the Texas Architectural Barriers Act (collectively,
the "Act"). Tenant, as part of the Tenant Improvements and included in the
Tenant Improvement Allowance, shall be responsible for construction of the
Tenant Improvements in compliance with the Act. Tenant shall be responsible, at
Tenant's sole cost and expense, for compliance of the Premises with the Act.
Tenant covenants and agrees that all alterations and improvements to the
Premises constructed by Tenant, whether prior to or after




                                       9
<PAGE>   46

the Commencement Date, shall be constructed in accordance with the Act. Except
to the extent Landlord is responsible for compliance with the Act as set forth
above, Tenant shall be responsible for any accommodations or alterations which
need to be made to the Premises to accommodate its disabled employees or
customers. If, subsequent to the Commencement Date, Tenant requests Landlord to
perform any alterations, additions or improvements to the Premises, whether by
virtue of expansion, extension or otherwise, Tenant agrees to and shall be
responsible for all costs and expense incurred in connection with any
improvements and alterations necessary to ensure compliance with the Act.






























INITIALED FOR IDENTIFICATION BY LANDLORD              AND TENANT




                                       10
<PAGE>   47


                                   EXHIBIT "D"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                         OF NORTH AMERICA, AS LANDLORD,
                       AND eLOYALTY CORPORATION, AS TENANT

                 RENTABLE AREA AND COMMENCEMENT DATE DECLARATION

         This declaration is executed with respect to that certain Lease
Agreement (the "Lease") dated March __, 2000 by and between Investors Life
Insurance Company of North America, a Washington corporation ("Landlord"), and
eLoyalty Corporation, a Delaware corporation ("Tenant"), covering approximately
square feet of rentable area on floors four and five of the Building.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Lease.

         By their respective execution below, Landlord and Tenant each hereby
stipulates and agrees that:

         (1)      The Commencement Date (as defined in Section 2.02 of the
                  Lease) occurred on _________________, 2000, and the Expiration
                  Date is May 31, 2005.

         (2)      The Premises contain rentable square feet.

         (3)      The Building contains __________ net rentable square feet.

         (4)      Tenant's Percentage Share for purposes of calculating Tenants
                  Percentage Share of Operating Expenses is %.

         (5)      Base Rent is payable in equal monthly installments starting on
                  the Commencement Date as follows:

<TABLE>
<S>                                        <C>                                 <C>
                  Lease Year 1      -       $                                   ($18.50 per rentable square foot)
                                             -----------------------------
                  Lease Year 2      -       $                                   ($19.00 per rentable square foot)
                                             -----------------------------
                  Lease Year 3      -       $                                   ($19.50 per rentable square foot)
                                             -----------------------------
                  Lease Year 4      -       $                                   ($20.00 per rentable square foot)
                                             -----------------------------
                  Lease Year 5      -       $                                   ($20.50 per rentable square foot)
                                             -----------------------------
</TABLE>

                  Additional Rent for the calendar year 2000 (based on $8.00 per
                  rentable square foot) is $                 per month.



                                       11
<PAGE>   48

         (6)      Other than latent defects of which Tenant is not aware, all
                  construction work per the Drawings is complete with the
                  exceptions outlined in the attached "punch list". Landlord
                  agrees to remedy the items on the punch list within thirty
                  (30) days of the date hereof.

         This declaration may be relied upon by any person having or acquiring
an interest in the Lease or the Building, without notice to or consent of
Landlord or Tenant.

         EXECUTED on this                        day of                  , 2000.

                                    LANDLORD:

                                    INVESTORS LIFE INSURANCE COMPANY
                                    OF NORTH AMERICA



                                    By:
                                    Name:
                                    Title:



                                    TENANT:

                                    eLOYALTY CORPORATION


                                    By:
                                    Name:
                                    Title:









                                        2
<PAGE>   49





INITIALED FOR IDENTIFICATION BY LANDLORD            AND TENANT









                                        3
<PAGE>   50


                                   EXHIBIT "E"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                         OF NORTH AMERICA, AS LANDLORD,
                       AND eLOYALTY CORPORATION, AS TENANT

                                 RENEWAL OPTION

         Provided that a Default by Tenant has not occurred and is continuing,
Tenant shall have the right and option (the "Renewal Option") to renew and
extend this Lease with respect to all of the Premises for two (2) consecutive
renewal terms for respective periods of five (5) years each. In order to
exercise each Renewal Option, Tenant must give Landlord written notice of the
exercise of the Renewal Option no later than one (1) year prior to the
expiration of the initial Term, or the expiration of the first renewal term, as
the case may be. Failure by Tenant to notify Landlord in writing of Tenant's
election to exercise a Renewal Option herein granted within the time limits set
forth for such exercise shall constitute a waiver of such Renewal Option. Each
renewal term shall be upon the same provisions as for the initial Term except as
follows:

         1. In the event Tenant elects to exercise the Renewal Options as set
forth above, Landlord shall, within thirty (30) days thereafter, notify Tenant
in writing of the proposed rental for the applicable Renewal Term, including any
annual adjustments to the Base Rent (the "Proposed Renewal Rental"). Within
fifteen (15) days following Landlord's delivery of the Proposed Renewal Rental,
Tenant shall notify Landlord in writing of the acceptance or rejection of the
Proposed Renewal Rental. If Tenant accepts Landlord's proposal, then the
Proposed Renewal Rental shall be the rental rate in effect during the applicable
renewal term. If Tenant fails to respond within such fifteen (15) day period,
Tenant shall be deemed to have rejected Landlord's Proposed Renewal Rental. If
Tenant rejects Landlord's Proposed Renewal Rental during such fifteen (15) day
period, Tenant's rejection notice must either (i) withdraw its exercise of the
Renewal Option, or (ii) exercise its right to a thirty (30) day negotiation
period with Landlord which right is hereby granted. If Tenant exercises such
right, Tenant and Landlord shall, in good faith, endeavor to negotiate a
reasonable renewal rental rate (the "Negotiated Renewal Rate"), providing
supporting cost and market data for its respective renewal rate preferences. If
Tenant and Landlord fail to agree upon a Negotiated Renewal Rental during such
thirty (30) day period, Tenant's may elect to either (i) withdraw its exercise
of the Renewal Option, or (ii) exercise its right to enter into arbitration with
Landlord concerning the Market Rate (as hereinafter defined), which right is
hereby granted, in accordance with the following procedure.

                  a. Within ten (10) days after Tenant delivers to Landlord its
rejection notice requesting arbitration of the Market Rate (the "Designation
Date"), Landlord and Tenant shall



                                       4
<PAGE>   51

each appoint an independent arbitrator who shall be an appraiser or licensed
real estate broker with at least five (5) years experience in building leasing,
management and marketing in the Austin, Texas, geographic real estate market or
in appraising leasehold interests under commercial leases, and shall be familiar
with the valuation of comparable property in such area and otherwise qualified
to act as an expert witness over objection to give opinion testimony addressed
to the issue in a court of competent jurisdiction. Each independent appraiser
shall not have been employed, regularly or as a broker or consultant, during the
past six (6) month period by the respective party selecting such person. By the
Designation Date, each party shall notify the other party in writing of the
name, address, telephone number and qualifications of its appraiser so
appointed. If either party shall fail to notify the other party of its named
appraiser by the Designation Date, the determination of the Market Rate by the
single appraiser appointed shall be conclusive and binding upon both Landlord
and Tenant. If both parties timely designate their respective appraisers, then
the two appointed appraisers shall select a third qualified appraiser within ten
(10) days after the Designation Date. Landlord and Tenant shall each bear the
cost of its appraiser and one-half (1/2) of the cost of the third appraiser.

                  b. The three appraisers shall determine the Market Rate in
accordance with the parameters set forth herein by mutual agreement within
thirty (30) business days after the Designation Date. If all of the appraisers
fail to agree on the Market Rate within thirty (30) business days after the
Designation Date, but two of the appraisers can so agree, then the Market Rate
as determined by such two appraisers shall be controlling. If none of the
appraisers can agree on the Market Rate within such time period, then an average
shall be taken of the two closest determinations thereof and such average shall
be controlling (except that if the median of the three rates provided by the
appraisers is also the average of the three, it shall be controlling). Tenant
shall have fifteen (15) days to accept or reject in writing the Market Rate as
determined by the arbitration procedure. If Tenant does not accept the Market
Rate as determined by the arbitration procedure on or before the end of said
fifteen (15) day period, then Tenant shall pay all of Landlord's costs
associated with obtaining the aforementioned appraisals and Tenant shall be
deemed to withdraw its exercise of the Renewal Option, and all rights of
Landlord and Tenant under this option to renew shall immediately terminate and
all terms and conditions of this option to renew shall be of no further force
and effect. Except as noted above in case of a failure to agree on Market Rate,
Tenant may not revoke its election to renew after such election has been made.

                  c. For purposes of this Lease and the arbitration process set
forth above, "Market Rate" shall be the then prevailing annual rental rates then
being charged for comparable space in first class buildings similarly situated
to the Building located in Austin, Travis County, Texas, taking into
consideration without limitation use, location and/or floor level within the
applicable building, definition of net rentable area, leasehold improvements
provided, quality, age and location of the applicable building, area of
premises, percentage of building included in

                                       2
<PAGE>   52

area of premises, rental concessions, the time the particular rate under
consideration became effective and all other then prevailing market inducements.

         2. During each such renewal term, Tenant shall pay all other Rent and
other amounts due under this Lease, including without limitation all rental
adjustments pursuant to Article 3 of this Lease, provided that any expense caps
or similar limitations shall not be renewed or carried forward (i.e., they shall
be adjusted to market) unless the Market Rate contemplates that such limitations
be continued during each renewal term.

         3. Tenant shall have no further right to renew this Lease.

         4. Upon exercise of the Renewal Option by Tenant and subject to the
conditions set forth herein, the Lease shall be extended for the period of such
Renewal Term without the necessity of the execution of any further instrument or
document, although if requested by either party, Landlord and Tenant shall enter
into a written agreement modifying and supplementing the Lease in accordance
with the provisions hereof. Any termination of the Lease during the initial Term
or the first renewal term shall terminate all subsequent renewal rights
hereunder. The renewal rights of Tenant hereunder shall not be severable from
the Lease, nor may such rights be assigned or otherwise conveyed in connection
with any permitted assignment of the Lease, unless such assignment is to
Tenant's subsidiary, affiliate, or successor in accordance with the provisions
of Article 12. Landlord's consent to any assignment of the Lease to a party
other than a subsidiary, affiliate, or successor of Tenant shall not be
construed as allowing an assignment of such rights to any assignee.


                                       3
<PAGE>   53



INITIALED FOR IDENTIFICATION BY LANDLORD                 AND TENANT






                                       4
<PAGE>   54


                                   EXHIBIT "F"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                         OF NORTH AMERICA, AS LANDLORD,
                       AND eLOYALTY CORPORATION, AS TENANT

                             RIGHT OF FIRST REFUSAL

         Landlord hereby grants to Tenant a right of first refusal (the "Right
of First Refusal") exercisable as hereinafter set forth, covering the remainder
of the third floor of the Building, containing approximately 16,414 rentable
square feet, more particularly described on the floor plan of the third floor of
the Building attached as Exhibit "A" to this Lease (the "Refusal Space"). All
rights of Tenant to lease the Refusal Space pursuant to the Right of First
Refusal shall be applicable to the entire Refusal Space or to any portion
thereof which may become available. The Right of First Refusal shall be as
follows:

         (a)      Upon the issuance by Landlord of a formal proposal to a third
                  party tenant to lease all or any portion of the Refusal Space,
                  Landlord shall notify the Tenant in writing (the "Offer
                  Notice") of the issuance of such formal proposal for all or
                  such portion of the Refusal Space (the "Offered Refusal
                  Space"). Tenant may exercise the Right of First Refusal and
                  include the Offered Refusal Space, or any other unleased
                  portion of the Refusal Space under this Lease, upon the terms
                  and conditions of this Lease by delivering to Landlord written
                  notice of Tenant's election (the "Acceptance Notice") on or
                  before the seventh (7th) business day after the date of
                  Tenant's receipt of the Offer Notice.

         (b)      In the event Landlord does not receive Tenant's Acceptance
                  Notice as to the Offered Refusal Space as described in the
                  Offer Notice within said seven (7) business day period, then
                  Landlord shall be free to lease the Offered Refusal Space to
                  one or more third parties, provided such third parties have
                  been the subject of an Offer Notice. Until May 31, 2003 (the
                  "Evergreen Period"), Tenant's failure to give Landlord a
                  Tenant's Acceptance Notice as to any Offered Refusal Space
                  described in an Offer Notice shall not constitute a waiver of
                  Tenant's right to receive a subsequent Offer Notice for all or
                  any portion of such Offered Refusal Space (assuming Landlord
                  does not consummate a lease with such third party tenant the
                  subject of the original Offer Notice). However, on May 31,
                  2003 the Evergreen Period expires, and thereafter, if Tenant
                  fails to timely give Landlord a Tenant's Acceptance Notice as
                  to any Offered Refusal Space covered by an Offer Notice, then
                  such failure shall be deemed a waiver and

                                       5
<PAGE>   55

                  release of Tenant's Right of First Refusal as to the Offered
                  Refusal Space designated in the Offer Notice.

         (c)      All Refusal Space leased by Tenant pursuant to the Right of
                  First Refusal shall be for a term which is coterminous with
                  the initial Term and any renewal or extension thereof.

         (d)      The term Premises, as used in this Lease, shall include all
                  expansions thereof that may occur from time to time pursuant
                  to this Right of First Refusal.

         (e)      In the event Tenant exercises the Right of First Refusal
                  pursuant to the terms hereof, Landlord shall do the work
                  necessary to furnish and install within the Refusal Space
                  leased by Tenant, in accordance with drawings to be prepared
                  by Tenant and approved in writing by Landlord, the tenant
                  improvements provided for in the drawings. The cost of the
                  work shall be advanced by Landlord for the benefit of Tenant,
                  to be repaid by Tenant in the form of Base Rent, but only to
                  the extent that the aggregate cost of the tenant improvements
                  for the Refusal Space provided for in the drawings does not
                  exceed an amount per square foot leased, rounded up or down to
                  the nearest cent (but not to exceed $18.00), equal to (X)
                  $18.00, times (Y) the number of months remaining in the Term
                  (excluding all renewals, unless such renewals have been
                  irrevocably exercised by Tenant), divided by (Z) sixty (60).

         (f)      The Base Rent for the Refusal Space shall be the same as the
                  Base Rent for the Premises and shall be due and payable
                  commencing on the earlier of (i) the date the tenant
                  improvements constructed by Landlord in the Refusal Space
                  leased by Tenant are substantially completed, or would have
                  been substantially completed but for Tenant Delays, and
                  Landlord has notified Tenant of such completion, or (ii) the
                  date Tenant begins the occupancy of all or any part of the
                  Refusal Space leased by Tenant in a reasonably normal manner
                  for the conduct of Tenant's business.

         (g)      Upon the exercise of the Refusal Option pursuant to the terms
                  hereof, Landlord and Tenant shall execute, at the request of
                  either party, an instrument delineating and describing the any
                  Refusal Space leased by Tenant and thereby added to the
                  Premises.

         (h)      In the event Tenant exercises the Right of First Refusal
                  pursuant to the terms hereof, as a condition precedent to
                  Tenant exercising the Right of First Refusal, Tenant must
                  cause the Security Deposit to be increased to an amount equal
                  to one

                                       2
<PAGE>   56

                  month's Base Rent on the entire Premises, including any
                  Refusal Space leased by Tenant.










INITIALED FOR IDENTIFICATION BY LANDLORD               AND TENANT


                                       3
<PAGE>   57



                                   EXHIBIT "G"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                         OF NORTH AMERICA, AS LANDLORD,
                       AND eLOYALTY CORPORATION, AS TENANT

                                EXPANSION OPTION

         Subject to the terms and conditions of this Lease, Landlord hereby
grants to Tenant an expansion option (the "Expansion Option") exercisable as
hereinafter set forth, covering the remainder of the third floor of the
Building, containing approximately 16,414 rentable square feet (the "Expansion
Space").

         (a)      Until November 1, 2002, so long as Tenant is not in default in
                  the performance of its covenants under this Lease, Tenant may
                  exercise the Expansion Option to include under this Lease,
                  beginning on June 1, 2003, all or any part of Expansion Space.
                  In the event Tenant desires to exercise the Expansion Option,
                  Tenant must deliver to Landlord written notice (the "Expansion
                  Notice") of Tenant's election on or before November 1, 2002.
                  If Tenant fails to deliver the Expansion Notice to Landlord by
                  November 1, 2002, Tenant's option to expand the Premises as
                  set forth herein shall terminate and be of no further force or
                  effect. The Rent for the Remaining Expansion Space shall the
                  same as for the Rent for the original Premises.

         (b)      If prior to November 1, 2002, Tenant fails to exercise its
                  Right of First Refusal with respect to an Offer Notice for all
                  or any portion of the Offered Refusal Space in accordance with
                  Exhibit "F" and Landlord subsequently leases such Offered
                  Refusal Space to another tenant which has been the subject of
                  the Offered Notice, then Tenant's Expansion Option with
                  respect to such Offered Refusal Space as such space also
                  constitutes Expansion Space, shall terminate; but in such
                  event, Landlord agrees to make available to Tenant up to
                  16,414 rentable square feet, either in the Building or in
                  other buildings located in the Project as designated by
                  Landlord, as replacement Expansion Space. (For example, and by
                  way of example only, if, prior to November 1, 2002, Landlord
                  gives Tenant an Offer Notice for 5,000 rentable square feet on
                  the third floor of the Building in accordance with Exhibit
                  "F", and Tenant fails to exercise its Right of First Refusal
                  for such 5,000 rentable square feet, and Landlord leases such
                  5,000 rentable square feet to a third party tenant, then such
                  5,000 rentable square feet shall also be excluded from the
                  Expansion Space, but only if Landlord makes available to
                  Tenant as replacement Expansion Space 5,000 rentable square
                  feet on


                                       4
<PAGE>   58

                  either the first or second floor of the Building or in another
                  building in the Project reasonably acceptable to Tenant.
                  Tenant's right to expand into the remaining portion of the
                  Expansion Space on the third floor shall not be affected by
                  Tenant's waiver of its Right of First Refusal as to the 5,000
                  rentable square feet in this example.)

         (c)      If Tenant does not exercise its Expansion Option as to all of
                  the Expansion Space by November 1, 2002, then as to the
                  portion of the Expansion Space which Tenant does not elect to
                  expand, Landlord shall have the right to lease such space to
                  third parties, but subject to the Right of First Refusal set
                  forth in Exhibit "F".

         (d)      The term "Premises," as used in this Lease, shall include all
                  expansions thereof that may occur from time to time.

         (e)      In the event Tenant exercises the Expansion Option pursuant to
                  the terms hereof, Landlord shall do the work necessary to
                  furnish and install within the Expansion Space tenant
                  improvements in accordance with drawings to be prepared by
                  Tenant and approved in writing by Landlord. The cost of the
                  work shall be advanced by Landlord for the benefit of Tenant,
                  to be repaid by Tenant in the form of Base Rent, but only to
                  the extent that the aggregate cost of furnishing the Building
                  Standard improvements and such additional improvements
                  provided for in the drawings does not exceed an amount per
                  square foot leased, rounded up or down to the nearest cent
                  (but not to exceed $18.00), equal to (X) $18.00, times (Y) the
                  number of months remaining in the Term (excluding all
                  renewals, unless such renewals have been irrevocably exercised
                  by Tenant), divided by (Z) sixty (60).

         (f)      The failure by Tenant to timely give the written Expansion
                  Option Notice above shall constitute the Tenant's decision not
                  to exercise the Expansion Option, and the Tenant shall be
                  considered to have permanently waived any rights to the
                  Expansion Space, except for Tenant's Right of First Refusal
                  set forth in Exhibit "F".

         (f)      Upon the exercise of the Expansion Option pursuant to the
                  terms hereof, Landlord and Tenant shall execute, at the
                  request of either party, an instrument delineating and
                  describing the space added to the Premises.

         (g)      All Expansion Space leased pursuant to this Exhibit "G" shall
                  be for a term which is coterminous with the initial Term of
                  this Lease, and any renewal or extension thereof.

                                       2
<PAGE>   59

         (h)      If Tenant timely exercises the Expansion Option and Landlord
                  is unable to accommodate Tenant's expansion needs because of
                  (i) the unavailability of 16,414 rentable square feet of
                  Expansion Space or (ii) in the event Tenant exercised its
                  Right of First Refusal to less than the entire Expansion
                  Space, the unavailability of such amount of space in the
                  Building or the Project as designated by Landlord, in
                  Landlord's discretion, that equals the excess of 16,414
                  rentable square feet of space less any amount of space
                  obtained by Tenant through its Right of First Refusal and that
                  is reasonably acceptable to Tenant, then Tenant shall have the
                  right to cancel and terminate this Lease as of May 31, 2003,
                  by giving Landlord written notice of such election no later
                  than December 1, 2002; provided, however, as a condition
                  precedent to Tenant being entitled to cancel and terminate
                  this Lease, Tenant must pay, prior to May 31, 2003, liquidated
                  damages to Landlord equal to the unamortized costs incurred by
                  Landlord in connection with this Lease, including, but not
                  limited to, Tenant Improvements constructed by Landlord,
                  Additional Tenant Improvements constructed by Landlord, and
                  leasing commissions. Landlord and Tenant hereby acknowledge
                  and agree they have included the provision for payment of
                  liquidated damages in this Exhibit "G" because, in the event
                  of a termination by Tenant in accordance with this provision,
                  the actual damages incurred by Landlord can reasonably be
                  expected to approximate the amount of liquidated damages
                  called for in this Section (h) of this Exhibit "G", and
                  because the actual amount of such damages would be difficult
                  if not impossible to accurately measure.

         (i)      In the event Tenant exercises the Expansion Option pursuant to
                  the terms hereof, as a condition precedent to Tenant
                  exercising the Expansion Option, Tenant must cause the
                  Security Deposit to be increased to an amount equal to one
                  month's Base Rent on the entire Premises, including any
                  Expansion Space leased by Tenant.















                                       3



<PAGE>   60






INITIALED FOR IDENTIFICATION BY LANDLORD              AND TENANT













                                        4
<PAGE>   61

                                   EXHIBIT "H"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                          OF NORTH AMERICA AS LANDLORD
                       AND eLOYALTY CORPORATION, AS TENANT


                          CERTIFICATE OF THE SECRETARY

          The undersigned, Secretary of eLoyalty Corporation, a Delaware
corporation (the"Corporation"), hereby certifies that attached is a true and
correct copy of the resolutions duly adopted by unanimous consent dated ,
          2000, of all directors of the Board of Directors of the Corporation
and that the same have not been amended, altered or rescinded and are now in
full force and effect; that the Corporation is duly organized and existing under
the laws of the State of Delaware; that all franchise and other taxes, if any,
required to maintain the corporate existence of the Corporation have been paid
when due and that no such taxes are delinquent; that no proceedings are pending
for the forfeiture of the Certificate of Incorporation of the Corporation or for
its dissolution, voluntary or involuntary; that the Corporation is duly
qualified to do business in the State of Texas and is in good standing in such
state; that there is no provision of the Articles of Incorporation or Bylaws of
the Corporation limiting the powers of the Board of Directors to pass or consent
to the resolutions set out in the instrument attached hereto and that said
resolutions are in conformity with the provisions of said Articles of
Incorporation and Bylaws; and that the Secretary is the keeper of the records
and minutes of the proceedings of the Board of Directors of the Corporation.

          This is to further certify that the persons named below are the duly
elected and qualified officers of the Corporation, holding the respective
offices set forth opposite their names, that they continue to hold these offices
at the present time, and that the respective signatures set opposite their names
are the genuine, original signatures of each respectively:

          Name                              Title                      Signature

                                            President
          ----------------------------                  ------------

                                            Secretary
          ----------------------------

          This is to further certify that the Corporation is duly organized and
existing under the laws of the State of Delaware; that all franchise and other
taxes, if any, required to maintain the existence of the Corporation have been
paid when due and that no such taxes are delinquent; that no proceedings are
pending for the dissolution or liquidation of the Corporation, voluntary


                                       5

<PAGE>   62

or involuntary; that the Partnership is duly qualified to do business in the
State of Texas; and that there is no provision of the partnership agreement
establishing the Corporation which would limit the powers of the Corporation to
execute a lease pursuant to the provisions which are attached hereto.

          IN WITNESS WHEREOF I have hereunto affixed my name as Secretary and
have caused the corporate seal of the Corporation to be hereto affixed this day
of             , 2000.




                                    Secretary


          The undersigned,                , President of the Corporation, hereby
certifies that              , is the duly elected and qualified Secretary of the
Corporation, that the signature above is his (her) genuine signature, that
attached is a true and correct copy of the resolutions duly adopted by the Board
of Directors of the Corporation, which are now in full force and effect; and
that the foregoing certificate is true and correct.




                                    President


          [ATTACHED TO THIS CERTIFICATE MUST BE CORPORATE RESOLUTIONS EVIDENCING
THAT THE OFFICER EXECUTING THE LEASE HAS AUTHORITY TO EXECUTE THIS LEASE FOR
TENANT]








                                       2

<PAGE>   63













          INITIALED FOR IDENTIFICATION BY LANDLORD              AND TENANT

                                   EXHIBIT "I"

                TO LEASE BETWEEN INVESTORS LIFE INSURANCE COMPANY
                          OF NORTH AMERICA AS LANDLORD
                       AND eLOYALTY CORPORATION, AS TENANT

                              RULES AND REGULATIONS

          The following standards shall be observed by Tenant for the mutual
safety, cleanliness and convenience of all occupants of the Building. These
rules are subject to change from time to time, as specified in the Lease.

          1. Tenant shall not use the Premises or the Building to sell any items
or services at retail price or cost without the prior written consent of
Landlord. Stenography, typewriting, blueprinting, duplicating services of any
kind, food and beverage services, and similar businesses, shall not be conducted
from or within the Premises or Building for the service or accommodation of
other occupants of the Building without the prior written consent of Landlord.

          2. Sidewalks, halls, passageways, fire exits, roof access, and
stairwells shall not be obstructed or used by Tenant for a purpose other than
ingress and egress to and from the Premises and Building.

          3. Flammable, explosive or other hazardous liquids and materials shall
not be brought on the Premises or into the Building without the prior written
consent of Landlord. All holiday decorations shall be made of flame retardant
materials and are limited to the interior of the Building.

          4. All contractors and technicians performing work for Tenant within
the Building shall be referred to Landlord for approval before performing such
work. All work, including, but not limited to, installation of telephone and
telegraph equipment, electrical and electronic

                                       3

<PAGE>   64

devices and attachments, and all installations affecting floors, walls, windows,
doors, ceilings or any other physical feature of the Building, shall not
commence prior to written approval by Landlord.

          5. Tenant shall not conduct any auction on the Premises nor store
goods, wares or merchandise on the Premises, except for Tenant's own personal
use.

          6. Movement into or out of the Building of freight, furniture, office
equipment or other material for dispatch or receipt by Tenant which requires
movement through public corridors or lobbies or entrances to the Building shall
be limited to the use of elevators only and shall be done at hours and in a
manner approved by Landlord for such purposes from time to time. Only licensed,
commercial movers shall be used for the purpose of moving freight, furniture or
office equipment to and from the Premises and Building. All hand trucks shall be
equipped with rubber tires and rubber side guards.

          7. Requests by Tenant for building services, maintenance or repair
shall be made in writing to the office of the Landlord or its management agent,
if any.

          8. Tenant shall not change locks or install additional locks on doors
without prior written consent of Landlord. Tenant shall not make or cause to be
made duplicates of keys procured from Landlord without the prior approval of
Landlord. All keys to the Premises shall be surrendered to Landlord upon
termination of tenancy.

          9. Tenant shall give prompt notice to the office of the Landlord or
its management agent, if any, of any damage to or defects in plumbing,
electrical fixtures or heating and cooling equipment. Liquids, or other
materials or substances which will cause injury to the plumbing, shall not be
put into the lavatories, water closets or other plumbing fixtures, by Tenant,
its agents, employees or invitees.

          10. Tenant shall not place, install or operate on the Premises, or in
any part of the Building or Project, any stoves or cooking equipment outside any
kitchen areas without the prior written approval of Landlord.

          11. Large files, safes, electronic data processing equipment and other
heavy equipment shall not be moved into the Building or installed in the
Premises without the prior written approval of Landlord.

          12. Tenant shall not lay floor covering within the Premises without
the prior written approval of Landlord. The use of cement or other similar
adhesive materials not easily removed with water is expressly prohibited.



                                       2

<PAGE>   65

          13. Tenant agrees to cooperate and assist Landlord in the prevention
of canvassing, soliciting and peddling within the Building.

          14. Nails, screws or picture hangers shall not be driven into the wood
finish of any room without the prior written consent of Landlord. Animals or
birds shall not be kept in or about the Premises or the Building.

          15. All plants within the Tenant Suite should be maintained by
professional plant management companies. Any infestation as a result of the
plants is the responsibility of the Tenant.

          16. No sign, advertisement, notice or handbill shall be exhibited,
distributed, painted or affixed by Tenant which is visible from any part of the
Project beyond the boundaries of the Premises without prior written consent of
the Landlord.

          17. Landlord reserves the right to exclude from the Building, between
the hours of 6:00 p.m. and 7:00 a.m. on weekdays and at all hours on Saturday,
Sunday and legal holidays, all persons who are not known to the Building
watchman, if any, and who do not present a pass to the Building signed by
Tenant. Each Tenant shall be responsible for all persons for whom he supplies a
pass or key to the Building or Premises.

          18. No smoking is allowed inside the Building. Smoking is restricted
to the exterior West end of the Building. Tenant shall be responsible for each
employee.

          19. Tenant will use all caution when driving and parking in the
garage. Landlord is NOT responsible for any lost, stolen, or damage done to
persons or property of Tenant and/or its employees as result of parking on the
Project. Parking around the Building is limited to handicapped and 30-minute
visitor parking only. There is no parking on the streets. Violating vehicles
will be towed at owner's expense.

          20. Tenant shall not use the Building or the Premises to store
vehicles, including without limitation boats, trailers, campers, golf carts,
motorcycles or automobiles. All vehicles other than automobiles and motorcycles
will be towed and stored at the owner's expense and Landlord shall assume no
liability therefore, and Tenant waives any claim arising by reason thereof and
agrees to hold Landlord harmless from any such claims arising from such towing,
storage or removal. Any automobile or motorcycle left on the Premises for more
than twenty (20) consecutive days may be towed and stored at the owner's expense
and Landlord shall assume no liability therefore and Tenant waives any claim
arising by reason thereof and agrees to hold Landlord harmless from any such
claims arising from such towing, storage or removal.




<PAGE>   66



  INITIALED FOR IDENTIFICATION BY LANDLORD                AND TENANT