Calculated under SFAS 123, the weighted-average fair value of the options granted during 1999, 1998 and 1997 was $5.24, $3.58 and $5.26 per share, respectively. The weighted average fair value of employee stock purchase rights granted under the ESPP during 1999, 1998 and 1997 were $2.83, $1.91 and $3.83 per share, respectively.

401 (k) Plan

The Company has a 401(k) plan covering substantially all of its U.S. employees. Under this plan, participating employees may defer up to 15 percent of their pre-tax earnings, subject to the Internal Revenue Service annual contribution limits. The Company matches 50 percent of each employee’s contribution up to a maximum of $2,000. The Company’s matching contributions to this 401(k) plan for 1999, 1998 and 1997 were $4.2 million, $3.5 million and $4.2 million, respectively.

The Company leases certain computer and office equipment under capital leases having terms of three-to-five years. Amounts capitalized for such leases are included on the consolidated balance sheets as follows:

During 1998 and 1997, the Company financed approximately $1.9 million and $10.5 million, respectively, of equipment purchases under capital lease arrangements. The Company did not finance a significant amount of equipment purchases under capital lease arrangements during 1999. Amortization of the cost of leased equipment is included in depreciation expense.

The Company leases certain of its office facilities and equipment under non-cancelable operating leases and total rent expense was $35.7 million, $30.7 million and $34.8 million in 1999, 1998 and 1997, respectively.

In November 1996, the Company leased approximately 200,000 square feet of office space in Santa Clara, California. The lease term is for fifteen years and minimum lease payments amount to $96.0 million over the term. The minimum lease payments increase within a contractual range based on changes in the Consumer Price Index. In the fourth quarter of 1997, the Company assigned the lease to an unrelated third party. The Company remains contingently liable for minimum lease payments under this assignment.

Future minimum payments, by year and in the aggregate, under the capital and non-cancelable operating leases as of December 31, 1999, are as follows:

The Company has several active software development and service provider contracts with third-party technology providers. These agreements contain financial commitments by the Company of $8.7 million, $7.8 million and $4.7 million in fiscal 2000, 2001 and 2002, respectively. In addition, the Company makes annual payments of approximately $1.9 million to third-party technology providers, and will continue to do so for such period as the Company utilizes the related technology in its products.