---

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Exhibit 10.gg

---

OPTION AGREEMENT

among

AMPAL-AMERICAN ISRAEL
CORPORATION

and

MERHAV (M.N.F.) Limited

dated as of December
25, 2007

---



---

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# TABLE OF CONTENTS

|                                                    |      |                                      | Page(s)
|--------------------------------------------------- | ---- | ------------------------------------ | -------
|
|
|
|
|                                                    |      |                                      |        
|ARTICLE I DEFINITIONS                               | 1   
|                                                    |      |                                      |        
|ARTICLE II OPTION                                   | 4   
|                                                    | 2.1  | Option                               | 4      
|                                                    |      |                                      |        
|ARTICLE III MERHAV'S REPRESENTATIONS AND WARRANTIES | 6   
|                                                    | 3.1  | Existence; Authority; Enforceability | 6      
|                                                    | 3.2  | Interests in the Project             | 6      
|                                                    | 3.3  | Absence of Conflicts                 | 6      
|                                                    | 3.4  | Compliance With Law; Consents        | 6      
|                                                    | 3.5  | Fees                                 | 7      
|                                                    | 3.6  | Disclosure                           | 7      
|                                                    |      |                                      |        
|ARTICLE IV COVENANTS                                | 7   
|                                                    | 4.1  | Due Diligence                        | 7      
|                                                    | 4.2  | Further Assurances                   | 7      
|                                                    |      |                                      |        
|ARTICLE V SURVIVAL                                  | 7   
|                                                    | 5.1  | Survival                             | 7      
|                                                    |      |                                      |        
|ARTICLE VI MISCELLANEOUS                            | 8   
|                                                    | 6.1  | Governing Law                        | 8      
|                                                    | 6.2  | Arbitration                          | 8      
|                                                    | 6.3  | Severability                         | 8      
|                                                    | 6.4  | Interpretation                       | 8      
|                                                    | 6.5  | Costs and Expenses                   | 8      
|                                                    | 6.6  | Notices                              | 8      
|                                                    | 6.7  | Counterparts                         | 9      
|                                                    | 6.8  | Entire Agreement                     | 9      
|                                                    | 6.9  | No Third Party Rights; Assignment    | 9      
|                                                    | 6.10 | Waivers and Amendments               | 10     

ii

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# OPTION AGREEMENT

OPTION
AGREEMENT (this Agreement), dated as of December 25, 2007, by and among
Ampal-American Israel Corporation, a New York corporation (Ampal), and
Merhav(m.n.f.) Limited, a company organized under the laws of the State of Israel
(Merhav) (each, a Party and, collectively, the
Parties).

# RECITALS

WHEREAS,
Merhav, directly and through certain subsidiaries, intends to develop an ethanol-producing
project in Colombia, as more fully described on Exhibit A hereto (the
Project);

WHEREAS,
Merhav has offered Ampal the opportunity to participate in the Project;

WHEREAS, Ampal
has expressed interest in the Project but requires additional time to complete its due
diligence with respect to the Project;

WHEREAS,
Merhav needed to fund the purchase of the real property for the Project prior to the
anticipated completion of Ampals due diligence;

WHEREAS,
to provide Merhav the required funding and Ampal the additional required time to complete
its due diligence on the Project, (i) Ampal extended Merhav a loan in the original
principal amount of $20,000,000 (the Loan) pursuant to the Promissory
Note, dated as of the same date hereof by Merhav in favor of Ampal (the
Promissory Note) and (ii) Merhav granted Ampal the option set forth in
this Agreement to purchase up to 35% percent interest in the Project on the terms herein
set forth;

NOW,
THEREFORE, in consideration of the aforesaid premises and of the mutual representations,
warranties and covenants contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Parties hereby agree as
follows:

# ARTICLE I

# DEFINITIONS

The
following terms shall have the following meanings for purposes of this Agreement:

Affiliate
means (i) with respect to any Person, a Person that controls, is controlled by, or is
under common control with such Person (it being understood, that a Person shall be deemed
to control another Person, for purposes of this definition, if such Person
directly or indirectly has the power to direct or cause the direction of the management
and policies of such other Person, whether through holding ownership interests in such
other Person, through agreements or otherwise); and (ii) with respect to any natural
Person, (1) any parent, grandparent, sibling, child or spouse of such natural Person, or
other Person related by marriage to any such Persons, (2) any trust established for
the benefit of such natural Person or any Affiliate of such natural Person or (3) any
executor or administrator of the estate of such natural Person.

1

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Agreement
has the meaning set forth in the Preamble.

Authority means
any governmental, judicial, legislative, executive, administrative or regulatory authority
of Israel and the United States or any state, local, provincial or foreign government or
any subdivision, agency, commission, office or judicial, administrative or regulatory
authority thereof.

Business
Day means any day other than a Saturday, Sunday or a day on which banking
institutions in New York, New York or Israel are authorized or obligated by law or
executive order to close.

Charter
Documents means any by-laws, charter, memorandum, certificate of incorporation,
articles of association and any other similar constitutive or governing documents.

Consent
means any consent, waiver, approval, authorization, exemption, registration, permit,
license or declaration of or by any Person or any Authority, or expiration or termination
of any applicable waiting period under any Legal Requirement, that is required with
respect to any Party in connection with (i) the execution and delivery of this Agreement
or any other Transaction Document or (ii) the consummation and performance of any of the
transactions provided for hereby or thereby.

Contract
or Contracts means any and all contracts and agreements, including
those that are franchises, warranties, understandings, arrangements, leases, licenses,
registrations, authorizations, mortgages, bonds, notes and other instruments (whether
written or oral).

Definitive
Documentation has the meaning set forth in Section 2.1(c).

Judgments
means any and all judgments, orders, writs, directives, rulings, decisions, injunctions,
decrees, settlement agreements or awards of any Authority or arbitrator.

Legal
Requirements means any and all (i) laws, ordinances and regulations, whether
federal, provincial, state or local, of Israel, the United States, or any other applicable
jurisdiction; (ii) codes, standards, rules, requirements and criteria issued under any
laws, ordinances and regulations, whether federal, provincial, state or local of Israel,
the United States or any other applicable jurisdiction; and (iii) Judgments.

Liabilities
means any obligation, liability, or indebtedness of any kind, character or description,
whether absolute, contingent, accrued, liquidated, unliquidated, known, unknown, executory
or otherwise.

Lien
means any mortgage, pledge, hypothecation, charge, assignment, deposit arrangement,
encumbrance, security interest, lien, fiduciary assignment and any security or similar
agreement of any kind or nature whatsoever.

Loan
has the meaning set forth in the Recitals.

2

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Necessary
Action means, with respect to a result required to be caused, all actions (to
the extent such actions are permitted by applicable Legal Requirements) reasonably
necessary to cause such result.

Note
Balance has the meaning set forth in Section 2.1(b).

Option
has the meaning set forth in Section 2.1(a).

Option
Closing has the meaning set forth in Section 2.1(c).

Option Interest
has the meaning set forth in Section 2.1(a).

Option
Termination Date means the earlier of (i) one year from the date hereof or (ii)
the Qualified Financing Date.

Party
or Parties has the meaning set forth in the Preamble.

Person
means an individual, corporation, partnership, trust, limited liability company, a branch
of any legal entity, unincorporated organization, joint stock company, joint venture,
association or other entity, or any government, or any agency or political subdivision
thereof.

Pledge
Agreement means the Pledge Agreement, dated as of the date hereof, between
Merhav and Ampal, delivered a security for the Loan.

Preamble
means the preamble to this Agreement.

Promissory
Note has the meaning set forth in the Recitals.

Project
shall have the meaning set forth in the recitals.

Purchase
Price has the meaning set forth in Section 2.1(b).

Qualified
Financing Date means the date on which both of the following events have
occurred: (i) Merhav has obtained debt financing for the Project from an unaffiliated
Third Party and (ii) an unaffiliated third party holds no less than a 25% equity interest
in the Project.

Recitals
means the recitals to this Agreement.

Third-Party
Price means the lowest price paid by an unaffiliated third party for interests
in the Project.

Transaction
Documents means each of this Agreement, the Promissory Note, the Pledge and any
other agreement, certificate or instrument delivered pursuant to any of the foregoing.

Transfer
means, whether voluntary or involuntary, any transfer, assignment (including any fiduciary
assignment), conveyance, sale, pledge or hypothecation.

3

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Valuation
Model means the model, dated as of October 2007 prepared by Merhav and Galileo
and attached hereto as Exhibit B, as reasonably updated with respect to project costs,
financing costs and other similar changes by Merhav and Galileo, as such updates are
approved by Houlihan Lokey Howard & Zukin as being consistent with the methodology and
assumptions set forth in the original model attached hereto as Exhibit B.

# ARTICLE II

# OPTION

2.1        Option.

| | (a)        At
any time from the date hereof through the Option Termination Date, Ampal           shall
have the option (but not the obligation) to purchase from Merhav (or the
          relevant subsidiary or Affiliate of Merhav) up to a 35% equity interest in the
          Project on a fully diluted basis (the Option). Ampal may
          exercise the Option set forth in this Section 2.1 by delivering written notice
          of its exercise of such right to Merhav (the Option Notice)
          prior to the Option Termination Date, setting forth the percentage interest
(the           Optioned Interest) up to 35% of the Project that Ampal
shall           acquire pursuant to the Option.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b)        The
Purchase Price (as defined below) for the Option Interest shall be paid as
          follows: (i) first, by conversion of the balance (up to the amount of the
          Purchase Price) of the outstanding balance of principal, interest and all other
          amounts due under the Promissory Note (the Note Balance) and
          (ii) if the Purchase Price exceeds the Note Balance, the excess of the Purchase
          Price over the Note Balance shall be paid by Ampal to Merhav at the Option
          Closing. The purchase price for the Optioned Interest (the Purchase
          Price) shall be determined as follows: the sum of (A) to the extent
          the Note Balance is being converted for the purchase of the Optioned Interest,
          the purchase price for each portion of the Optioned Interest shall be the lower
          of (x) the purchase price for the Optioned Interest based on a valuation of the
          Project in accordance with the Valuation Model or (y) the Third Party Price,
and           (B) after converting the Note Balance in full at the price determined
pursuant           to clause (A) of this sentence, any portion of the Optioned Interest
that           remains to be purchased shall be purchased at the Third Party Price,
except if           no Third Party price exists the purchase price will be based on the
Valuation           Model.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

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| | (c)        Upon
exercise of the Option, Ampal and Merhav shall execute within 45 days (the
          Option Closing) of the date of the Option Notice but not
          later than the Qualified Financing Date definitive documents evidencing (i) the
          purchase by Ampal from Merhav of the Optioned Interest, which documents shall
          have customary representations and warranties from Merhav, including with
          respect to Merhav (and any relevant subsidiary and affiliate relating to the
          Project), the Project and the Optioned Interest and (ii) the agreement between
          Ampal and Merhav with respect to the management and governance of the Project
          and the rights of Ampal as a holder of an Interest in the Project (the
          Definitive Documents). At the Option Closing, Merhav shall
          deliver to Ampal such documentation reasonably requested by Ampal and required
          to transfer to Ampal the Optioned Interest, free and clear of any Liens
          attributable to Merhav or any of is Affiliates. Merhav hereby acknowledges and
          confirms that Ampals obligation to consummate the purchase of the
Optioned           Interest is expressly conditioned upon the approval by the Audit
Committee of           the Board of Directors of Ampal of the Definitive Documents.
Without limiting           anything contained herein, Merhav and Ampal hereby agree that
the Definitive           Documents shall contain the following provisions:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (i)        the
right to appoint such number of the directors (or members of any applicable
          governing body of the Project) of the total board of directors (or similar
body)           managing the project equal to the percentage interest the Optioned
Interest is           to the total outstanding equity interests of the Project (to the
extent there is           more than one entity is involved in the Project, this provision
shall be read to           provide Ampal with the ability to exercise the same amount of
control as such           number of directors (or other persons) would have if the
Project was a single           entity);
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (ii)        the
right to participate in any sale of an interest in the Project by an other
          interest holder on the same terms as such interest holder;
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (iii)        full
ratchet anti-dilution protection with respect to the Optioned Interest,           with
respect to any equity interest of the Project sold by the Company from and
          after the date of the Option Closing;
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (iv)        right
of first refusal for Ampal on any sale of any equity interest by Merhav           after
the Option Closing, provided that Merhav may transfer shares not           subject
to such right of first refusal (i) to a single strategic partner to the           extent
that such transferred equity interest, together with any equity interest
          currently held by such strategic partner, will not result in such strategic
          partner or its affiliates having an equity interest in the Project in excess of
          35% of the Project and (ii) to Riagro S.A. to the extent such transferred
equity           interest does not exceed 2.5% of the Project;
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (v)        any
financing obtained by and for the Project shall be non-recourse to Ampal
          without Ampals consent;
| | --------------------------------------------------------------------------------------------------------------------------

| | (vi)        Ampal
shall have the right to consent to any modification of the Charter           Documents of
the Project or any entity comprising the Project in a manner           adverse to Ampal
or any change in purpose of the Project;
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (vii)        the
right for Ampal to consent to any transactions involving the Project and           Merhav
or any of its Affiliates.
| | ------------------------------------------------------------------------------------------------------------------------------------

| | (viii)        customary
preemptive rights; and
| | ----------------------------------------------

| | (ix)        Ampal
shall be permitted to Transfer its interest.
| | --------------------------------------------------------------

5

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| | (d)        Notwithstanding
the forgoing and without limiting the forgoing requirements of           the Definitive
Documents, Ampal shall have the benefit of any broader rights and           preferences
held or granted to any other investor.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# ARTICLE III

# MERHAVS
REPRESENTATIONS AND WARRANTIES

Merhav
hereby represents and warrants to Ampal on the date hereof:

3.1        Existence;
Authority; Enforceability. Merhav is a company duly organized and validly existing
under the laws of Israel. Merhav has the requisite power and authority to enter into each
Transaction Document to which it is a party and to perform its respective obligations
thereunder. The execution, delivery and performance by Merhav of each Transaction
Document to which it will be a party and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized and approved by all corporate
action of Merhav. Merhav has duly and validly executed and delivered each Transaction
Document to which it is a party, and each such Transaction Document constitutes its
legal, valid and binding obligation, enforceable against Merhav, in accordance with its
terms.

3.2        Interests
in the Project. (a) Merhav currently owns 100% of the outstanding equity interests in
the Project. All of the issued and outstanding interests in the Project have been duly
authorized, validly issued and are be fully paid, nonassessable, free of preemptive
rights, with no personal liability attaching to the ownership thereof. There are no
outstanding securities convertible into, exchangeable for, or carrying the right to
acquire, any interest in the Project, or subscriptions, warrants, options, calls, rights
(pre-emptive or other) or other arrangements or commitments obligating any person to
issue or dispose of any of its capital stock or any ownership interest therein, other
than an Agreement with Riagro S.A., pursuant to which Riagro shall be entitled to up to a
2.5% equity interest in the Project, coming from Merhavs holdings in the Project.

3.3        Absence
of Conflicts. The execution and delivery by Merhav of the Transaction Documents to
which it is a party and the performance of its respective obligations hereunder and
thereunder, and the consummation of the transactions contemplated hereby and thereby does
not and will not conflict with, or result in the breach of any provision of, the Charter
Documents of Merhav or any Contract or violate any Legal Requirement applicable to
Merhav.

3.4        Compliance
With Law; Consents. No Consent is required to be made or obtained by Merhav in
connection with (i) the execution, delivery or performance of the Transaction Documents
to be entered into by Merhav or (ii) the consummation of any of the transactions
contemplated by the Transaction Documents. To the best of Merhavs knowledge, Merhav
and the Project are in compliance in all respects with all applicable Legal Requirements,
except where such failure would not have or could not reasonably by expected to have a
material adverse effect on Merhav, the Project or Merhavs ability to consummate the
transactions contemplated by, and perform its obligations, under the Transaction
Documents.

6

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3.5        Fees.
Neither Merhav nor any of its Affiliates has paid or become obligated to pay any fee or
commission to any broker, finder or intermediary in connection with the transactions
contemplated hereby.

3.6        Disclosure.
Merhav has provided to Ampal all documents and information (i) in Merhavs or any of
its Affiliates possession relating to the Project, and (ii) that is reasonably
material in connection with a decision to make the Loan or exercise the Option, including
without limitation the reports and evaluations of the Project set forth on Exhibit C
hereto. No representation or warranty by Merhav contained in this Agreement or any other
Transaction Document and no information contained in any other instrument furnished or to
be furnished to Ampal pursuant hereto or in connection with the transaction contemplated
by this Agreement or any other Transaction Document contains or will contain any untrue
statement of a material fact or omits or will omit to state a material fact necessary in
order to make the statements contained herein or therein not misleading. Merhav is not
aware of any facts or circumstances which would cause the representations and warranties
of Merhav contained in this Agreement or any other Transaction Documents to be untrue or
incorrect. To the knowledge of Merhav, after due inquiry, there is no fact, circumstance
or condition which has had or could reasonably be expected to have a material adverse
effect on Merhav or the Project, which has not been disclosed to Ampal or its
representatives.

# ARTICLE IV

# COVENANTS

4.1        Due
Diligence. Merhav hereby agrees to cooperate with Ampal in its due diligence and
shall provide Ampal with such information and documents as Ampal shall reasonably request
The Parties agree that the due diligence to be conducted by Ampal shall be to assist
Ampal (i) in confirming the representations and warranties of Merhav set forth in this
Agreement, and (ii) determining whether to exercise its Option. In addition, Merhav
hereby agrees to promptly deliver to Ampal (x) any new material information with respect
to the Project in its possession or control and (y) any reports, models, projections or
other information provided to any other person or entity.

4.2        Further
Assurances. Subject to the terms and conditions herein, each of the Parties agrees to
take, or use reasonable commercial efforts in order to cause to be taken, all Necessary
Actions and to do, or use reasonable commercial efforts in order to cause to be done, all
things necessary, proper or advisable under all applicable Legal Requirements to
consummate and make effective the transactions contemplated by the Transaction Documents
to which it is a party.

# ARTICLE V

# SURVIVAL

5.1        Survival.
Each representation and warranty in this Agreement shall survive for a period of two
years after the date hereof, provided that (i) the representation set forth
in Section 3.1 and 3.2 shall survive indefinitely and (ii) the survival periods set forth
in this Section 5.1 shall not apply to any claims involving fraud or bad faith on the
part of any Party hereto.

7

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# ARTICLE VI

# MISCELLANEOUS

6.1        Governing
Law. This Agreement shall be governed in all respects, including validity,
interpretation and effect, by the internal laws of the State of New York without regard
to its conflict of law principles (other than Section 5-1401 of the New York General
Obligation Law).

6.2        Arbitration.  All disputes between the parties hereto arising under the terms of this Agreement
or any other Transaction Documents shall be arbitrated in New York City under the rules
of the American Arbitration Association then obtaining in the City of New York judgment
on any award made by the arbitrators hereunder may be rendered in any court having
jurisdiction.

6.3        Severability.
Each Section, subsection and clause of this Agreement and each other Transaction
Documents constitutes a separate and distinct undertaking, covenant or provision hereof.
In the event that any provision of this Agreement or any other Transaction Document shall
finally be determined to be unlawful, such provision shall be deemed severed from this
Agreement or such Transaction Document, but every other provision of this Agreement or
such Transaction Document shall remain in full force and effect.

6.4        Interpretation.
Whenever used in this Agreement, except as otherwise expressly provided or unless the
context otherwise requires, any noun or pronoun shall be deemed to include the plural as
well as the singular and to cover all genders. Unless otherwise specified, words such as
herein, hereof, hereby, hereunder and
words of similar import refer to this Agreement as a whole and not to any particular
Section or subsection of this Agreement, and references herein to Articles or
Sections refer to Articles or Sections of this Agreement. The headings in
this Agreement are intended solely for convenience of reference and shall be given no
effect in the construction or interpretation of this Agreement.

6.5        Costs
and Expenses. Each Party shall bear its own expenses incurred in connection with the
negotiation, preparation, execution and closing of this Agreement and each other
Transaction Document and the transactions provided for hereby and thereby.

6.6        Notices.
All notices or other communications required or permitted by this Agreement or any other
Transaction Document shall be effective upon receipt and shall be in writing and
delivered personally or by overnight courier, or sent by facsimile (with confirmation
copies delivered personally or by courier within three (3) Business Days), as follows:

8

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| | If
to Merhav, to:
| | -----------------

| | Merhav
(m.n.f) Ltd
| | ------------------

| | 33
Havatzelet Hasharon Street
| | -----------------------------

| | Herzlia,
Israel
| | ---------------

| | Attention:
Mr. Yossef Maiman and Mr. Leo Malamud
| | ------------------------------------------------

| | Facsimile:+972-9-9501733
| | ------------------------

| | If
to Ampal, to:
| | ----------------

| | Ampal-American
Israel Corporation
| | ---------------------------------

| | 111
Arlozorov Street
| | --------------------

| | Tel
Aviv 62098 Israel
| | ---------------------

| | Attention:
Yoram Firon
| | ----------------------

| | Facsimile:+972-3-6080101
| | ------------------------

| | with
copies to:
| | ---------------

| | Bryan
Cave LLP
| | --------------

| | 1290
Avenue of the Americas
| | ---------------------------

| | New
York, NY, USA 10019
| | -----------------------

| | Attention:
Kenneth Henderson, Esq.
| | ----------------------------------

| | Facsimile:
(212) 541-1357
| | -------------------------

or to such other address as hereafter
shall be furnished as provided in this Section 6.6 by any Party to any other Party. Any
demand, notice or other communication given by personal delivery shall be conclusively
deemed to have been given on the day of actual delivery thereof and, if given by
facsimile, on the day of transmittal thereof if given during the normal business hours of
the recipient, and on the Business Day during which such normal business hours next occur
if not given during such hours on any day.

6.7        Counterparts.
This Agreement and each other Transaction Document may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which together shall
constitute a single instrument.

6.8        Entire
Agreement. This Agreement together with the other Transaction Documents set forth the
entire understanding and agreement between the Parties as to the matters covered herein
and therein and supersede and replace any prior understanding, agreement or statement of
intent, in each case, written or oral, of any and every nature with respect thereto. In
the event of any inconsistency between this Agreement and the other Transaction
Documents, this Agreement shall govern as between the Parties with respect to the matters
set forth herein.

6.9        No
Third Party Rights; Assignment. This Agreement is intended to be solely for the
benefit of the Parties and is not intended to confer any benefits upon, or create any
rights in favor, of any Person other than the Parties and shall not be assignable without
the prior written Consent of the other Parties. Notwithstanding any of the foregoing,
Ampal may transfer its rights and interests hereunder to an Affiliate.

9

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6.10        Waivers
and Amendments. No modification of or amendment to this Agreement or any other
Transaction Document shall be valid unless in writing signed by the Parties referring
specifically to this Agreement or such other Transaction Document and stating the Parties intention
to modify or amend the same. Any waiver of any term or condition of this Agreement or any
other Transaction Document must be in a writing signed by the Party sought to be charged
with such waiver referring specifically to the term or condition to be waived, and no
such waiver shall be deemed to constitute the waiver of any other breach of the same or
of any other term or condition of this Agreement or any other Transaction Document.

10

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IN
WITNESS WHEREOF, the parties hereto have duly executed this Option Agreement as of the
date first above written.

| |  | AMPAL-AMERICAN ISRAEL CORPORATIONBy:
 Name: Irit Eluz, Yoram FironTitle:   CFO,                    VP
| |  | -------------------------------------------------------------------------------------------------------------------

| |  | MERHAV (M.N.F)  LIMITEDBy:
Name: Yosef A. MaimanTitle:   Director
| |  | -------------------------------------------------------------------------------

[SIGNATURE PAGE TO
OPTION AGREEMENT]

11

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