<PAGE>

                                                                  EXHIBIT 10.10

                          PRIME RESPONSE GROUP, INC.
                           STOCK ISSUANCE AGREEMENT
                           ------------------------


          AGREEMENT made as of this _____ day of ______________ 199___, by and
between Prime Response Group, Inc., a Delaware corporation, and
___________________________________________, Participant in the Corporation's
1998 Stock Option/Stock Issuance Plan.

          All capitalized terms in this Agreement shall have the meaning
assigned to them in this Agreement or in the attached Appendix.

     I.   PURCHASE OF SHARES
          ------------------

          1.  PURCHASE.  Participant hereby purchases _____________ shares of
              --------
Common Stock (the "Purchased Shares") pursuant to the provisions of the Stock
Issuance Program at the purchase price of $____________ per share (the "Purchase
Price").

          2.  PAYMENT.  Concurrently with the delivery of this Agreement to the
              -------
Corporation,  Participant shall pay the Purchase Price for the Purchased Shares
in cash or cash equivalent and shall deliver a duly-executed blank Assignment
Separate from Certificate (in the form attached hereto as Exhibit I) with
respect to the Purchased Shares.

          3.  STOCKHOLDER RIGHTS.  Until such time as the Corporation exercises
              ------------------
the Repurchase Right or the First Refusal Right, Participant (or any successor
in interest) shall have all stockholder rights (including voting, dividend and
liquidation rights) with respect to the Purchased Shares, subject, however, to
the transfer restrictions of Articles B and C.

     A.   SECURITIES LAW COMPLIANCE
          -------------------------

          1.  RESTRICTED SECURITIES.  The Purchased Shares have not been
              ---------------------
registered under the 1933 Act and are being issued to Participant in reliance
upon the exemption from such registration provided by SEC Rule 701 for stock
issuances under compensatory benefit plans such as the Plan. Participant hereby
confirms that Participant has been informed that the Purchased Shares are
restricted securities under the 1933 Act and may not be resold or transferred
unless the Purchased Shares are first registered under the Federal securities
laws or unless an exemption from such registration is available. Accordingly,
Participant hereby acknowledges that Participant is prepared to hold the
Purchased Shares for an indefinite period and that Participant is aware that SEC
Rule 144 issued under the 1933 Act which exempts certain resales of unrestricted
securities is not presently available to exempt the resale of the Purchased
Shares from the registration requirements of the 1933 Act.

          2.  DISPOSITION OF PURCHASED SHARES.  Participant shall make no
              -------------------------------
disposition of the Purchased Shares (other than a Permitted Transfer) unless and
until there is compliance with all of the following requirements:

              (i) Participant shall have provided the Corporation with a written
     summary of the terms and conditions of the proposed disposition.

                                       1
<PAGE>

              (ii) Participant shall have complied with all requirements of this
     Agreement applicable to the disposition of the Purchased Shares.

              (iii) Participant shall have provided the Corporation with written
     assurances, in form and substance satisfactory to the Corporation, that (a)
     the proposed disposition does not require registration of the Purchased
     Shares under the 1933 Act or (b) all appropriate action necessary for
     compliance with the registration requirements of the 1933 Act or any
     exemption from registration available under the 1933 Act (including Rule
     144) has been taken.

          The Corporation shall not be required (i) to transfer on its books any
Purchased Shares which have been sold or transferred in violation of the
provisions of this Agreement or (ii) to treat as the owner of the Purchased
Shares, or otherwise to accord voting, dividend or liquidation rights to, any
transferee to whom the Purchased Shares have been transferred in contravention
of this Agreement.

     3.   RESTRICTIVE LEGENDS.  The stock certificates for the Purchased
          -------------------
Shares shall be endorsed with one or more of the following restrictive legends:

          "The shares represented by this certificate have not been
     registered under the Securities Act of 1933. The shares may not be
     sold or offered for sale in the absence of (a) an effective
     registration statement for the shares under such Act, (b) a "no
     action" letter of the Securities and Exchange Commission with respect
     to such sale or offer or (c) satisfactory assurances to the
     Corporation that registration under such Act is not required with
     respect to such sale or offer."

          "The shares represented by this certificate are subject to
     certain repurchase rights and rights of first refusal granted to the
     Corporation and accordingly may not be sold, assigned, transferred,
     encumbered, or in any manner disposed of except in conformity with
     the terms of a written agreement dated ______, 199___ between the
     Corporation and the registered holder of the shares (or the
     predecessor in interest to the shares). A copy of such agreement is
     maintained at the Corporation's principal corporate offices."

          B.   TRANSFER RESTRICTIONS
               ---------------------

               1.  RESTRICTION ON TRANSFER.  Except for any Permitted Transfer,
                   -----------------------
Participant shall not transfer, assign, encumber or otherwise dispose of any of
the Purchased Shares which are subject to the Repurchase Right. In addition,
Purchased Shares which are released from the Repurchase Right shall not be
transferred, assigned, encumbered or otherwise disposed of in contravention of
the First Refusal Right or the Market Stand-Off.

               2.  TRANSFEREE OBLIGATIONS.  Each person (other than the
                   ----------------------
Corporation) to whom the Purchased Shares are transferred by means of a
Permitted Transfer must, as a condition precedent to the validity of such
transfer, acknowledge in writing to the Corporation that such person is bound by
the provisions of this Agreement and that the transferred shares are subject to
(i) the Repurchase Right, (ii) the First Refusal Right and (iii) the Market
Stand-Off, to the same extent such shares would be so subject if retained by
Participant.

                                       2
<PAGE>

               3.  MARKET STAND-OFF.
                   ----------------

                   (a) In connection with any underwritten public offering by
the Corporation of its equity securities pursuant to an effective registration
statement filed under the 1933 Act, including the Corporation's initial public
offering, Owner shall not sell, make any short sale of, loan, hypothecate,
pledge, grant any option for the purchase of, or otherwise dispose or transfer
for value or otherwise agree to engage in any of the foregoing transactions with
respect to, any Purchased Shares without the prior written consent of the
Corporation or its underwriters. Such restriction (the "Market Stand-Off") shall
be in effect for such period of time from and after the effective date of the
final prospectus for the offering as may be requested by the Corporation or such
underwriters. In no event, however, shall such period exceed one hundred eighty
(180) days and the Market Stand-Off shall in all events terminate two (2) years
after the effective date of the Corporation's initial public offering.

                   (b) Owner shall be subject to the Market Stand-Off provided
and only if the officers and directors of the Corporation are also subject to
similar restrictions.

                   (c) Any new, substituted or additional securities which are
by reason of any Recapitalization or Reorganization distributed with respect to
the Purchased Shares shall be immediately subject to the Market Stand-Off, to
the same extent the Purchased Shares are at such time covered by such
provisions.

                   (d) In order to enforce the Market Stand-Off, the Corporation
may impose stop-transfer instructions with respect to the Purchased Shares until
the end of the applicable stand-off period.

          C.   REPURCHASE RIGHT
               ----------------

               1.  GRANT.  The Corporation is hereby granted the right (the
                   -----
"Repurchase Right"), exercisable at any time during the sixty (60)-day period
following the date Participant ceases for any reason to remain in Service, to
repurchase at the Purchase Price any or all of the Purchased Shares in which
Participant is not, at the time of his or her cessation of Service, vested in
accordance with the provisions of the Vesting Schedule set forth in Paragraph
D.3 or the special vesting acceleration provisions of Paragraph D.5 (such shares
to be hereinafter referred to as the "Unvested Shares").

               2.  EXERCISE OF THE REPURCHASE RIGHT.  The Repurchase Right shall
                   --------------------------------
be exercisable by written notice delivered to each Owner of the Unvested Shares
prior to the expiration of the sixty (60)-day exercise period. The notice shall
indicate the number of Unvested Shares to be repurchased and the date on which
the repurchase is to be effected, such date to be not more than thirty (30) days
after the date of such notice. The certificates representing the Unvested Shares
to be repurchased shall be delivered to the Corporation on or before the close
of business on the date specified for the repurchase. Concurrently with the
receipt of such stock certificates, the Corporation shall pay to Owner, in cash
or cash equivalents (including the cancellation of any purchase-money
indebtedness), an amount equal to the Purchase Price previously paid for the
Unvested Shares which are to be repurchased from Owner.

                                       3
<PAGE>

               3.  TERMINATION OF THE REPURCHASE RIGHT.  The Repurchase Right
                   -----------------------------------
shall terminate with respect to any Unvested Shares for which it is not timely
exercised under Paragraph D.2. In addition, the Repurchase Right shall terminate
and cease to be exercisable with respect to any and all Purchased Shares in
which Participant vests in accordance with the following Vesting Schedule:

          Participant shall vest in twenty-five percent (25%) of the
     Purchased Shares, and the Repurchase Right shall concurrently lapse
     with respect to those Purchased Shares, upon Participant's completion
     of one (1) year of Service measured from ________________________,
     199____.

          Participant shall vest in the remaining seventy-five percent
     (75%) of the Purchased Shares, and the Repurchase Right shall
     concurrently lapse with respect to those Purchased Shares, in a
     series of thirty-six (36) successive equal monthly installments upon
     Participant's completion of each additional month of Service over the
     thirty-six (36)-month period measured from the date on which the
     first twenty-five percent (25%) of the Purchased Shares vests
     hereunder.

          All Purchased Shares as to which the Repurchase Right lapses
     shall, however, remain subject to (i) the First Refusal Right and
     (ii) the Market Stand-Off.

          4.  RECAPITALIZATION.  Any new, substituted or additional securities
              ----------------
or other property (including cash paid other than as a regular cash dividend)
which is by reason of any Recapitalization distributed with respect to the
Purchased Shares shall be immediately subject to the Repurchase Right and any
escrow requirements hereunder, but only to the extent the Purchased Shares are
at the time covered by such right or escrow requirements. Appropriate
adjustments to reflect such distribution shall be made to the number and/or
class of Purchased Shares subject to this Agreement and to the price per share
to be paid upon the exercise of the Repurchase Right in order to reflect the
effect of any such Recapitalization upon the Corporation's capital structure;
provided, however, that the aggregate purchase price shall remain the same.

          5.  CORPORATE TRANSACTION.
              ---------------------

              (a) The Repurchase Right shall automatically terminate in its
entirety, and all the Purchased Shares shall vest in full, immediately prior to
the consummation of any Corporate Transaction, except to the extent the
Repurchase Right is to be assigned to the successor entity in such Corporate
Transaction.

              (b) To the extent the Repurchase Right remains in effect following
a Corporate Transaction, such right shall apply to any new securities or other
property (including any cash payments) received in exchange for the Purchased
Shares in consummation of the Corporate Transaction, but only to the extent the
Purchased Shares are at the time covered by such right. Appropriate adjustments
shall be made to the price per share payable upon exercise of the Repurchase
Right to reflect the effect of the Corporate Transaction upon the Corporation's
capital structure; provided, however, that the aggregate purchase price shall
remain the same. The new securities or other property (including any cash
payments) issued or distributed with

                                       4
<PAGE>

respect to the Purchased Shares in consummation of the Corporate Transaction
shall be immediately deposited in escrow with the Corporation (or the successor
entity) and shall not be released from escrow until Participant vests in such
securities or other property in accordance with the same Vesting Schedule in
effect for the Purchased Shares.

              (c) The Repurchase Right may also terminate on an accelerated
basis, and the Purchased Shares shall immediately vest in full, in accordance
with the terms and conditions of any special addendum attached to this
Agreement.

     D.   RIGHT OF FIRST REFUSAL
          ----------------------

          1.   GRANT.  The Corporation is hereby granted the right of first
               -----
refusal (the "First Refusal Right"), exercisable in connection with any proposed
transfer of the Purchased Shares in which Participant has vested in accordance
with the provisions of Article D. For purposes of this Article E, the term
"transfer" shall include any sale, assignment, pledge, encumbrance or other
disposition of the Purchased Shares intended to be made by Owner, but shall not
include any Permitted Transfer.

          2.   NOTICE OF INTENDED DISPOSITION.  In the event any Owner of
               ------------------------------
Purchased Shares in which Participant has vested desires to accept a bona fide
third-party offer for the transfer of any or all of such shares (the Purchased
Shares subject to such offer to be hereinafter referred to as the "Target
Shares"), Owner shall promptly (i) deliver to the Corporation written notice
(the "Disposition Notice") of the terms of the offer, including the purchase
price and the identity of the third-party offeror, and (ii) provide satisfactory
proof that the disposition of the Target Shares to such third-party offeror
would not be in contravention of the provisions set forth in Articles B and C.

          3.   EXERCISE OF THE FIRST REFUSAL RIGHT.  The Corporation shall, for
               -----------------------------------
a period of twenty-five (25) days following receipt of the Disposition Notice,
have the right to repurchase any or all of the Target Shares subject to the
Disposition Notice upon the same terms as those specified therein or upon such
other terms (not materially different from those specified in the Disposition
Notice) to which Owner consents. Such right shall be exercisable by delivery of
written notice (the "Exercise Notice") to Owner prior to the expiration of the
twenty-five (25)-day exercise period. If such right is exercised with respect to
all the Target Shares, then the Corporation shall effect the repurchase of such
shares, including payment of the purchase price, not more than five (5) business
days after delivery of the Exercise Notice; and at such time the certificates
representing the Target Shares shall be delivered to the Corporation.

          Should the purchase price specified in the Disposition Notice be
payable in property other than cash or evidences of indebtedness, the
Corporation shall have the right to pay the purchase price in the form of cash
equal in amount to the value of such property.  If Owner and the Corporation
cannot agree on such cash value within ten (10) days after the Corporation's
receipt of the Disposition Notice, the valuation shall be made by an appraiser
of recognized standing selected by Owner and the Corporation or, if they cannot
agree on an appraiser within twenty (20) days after the Corporation's receipt of
the Disposition Notice, each shall select an appraiser of recognized standing
and the two (2) appraisers shall designate a third appraiser of recognized
standing, whose appraisal shall be determinative of such value.  The cost of
such

                                       5
<PAGE>

appraisal shall be shared equally by Owner and the Corporation. The closing
shall then be held on the later of (i) the fifth (5th) business day following
delivery of the Exercise Notice or (ii) the fifth (5th) business day after such
valuation shall have been made.

          4.   NON-EXERCISE OF THE FIRST REFUSAL RIGHT.  In the event the
               ---------------------------------------
Exercise Notice is not given to Owner prior to the expiration of the twenty-five
(25)-day exercise period, Owner shall have a period of thirty (30) days
thereafter in which to sell or otherwise dispose of the Target Shares to the
third-party offeror identified in the Disposition Notice upon terms (including
the purchase price) no more favorable to such third-party offeror than those
specified in the Disposition Notice; provided, however, that any such sale or
disposition must not be effected in contravention of the provisions of Articles
B and C. The third-party offeror shall acquire the Target Shares free and clear
of the First Refusal Right, but the acquired shares shall remain subject to the
provisions of Article B and Paragraph C.3. In the event Owner does not effect
such sale or disposition of the Target Shares within the specified thirty
(30)-day period, the First Refusal Right shall continue to be applicable to any
subsequent disposition of the Target Shares by Owner until such right lapses.

          5.   PARTIAL EXERCISE OF THE FIRST REFUSAL RIGHT.  In the event the
               -------------------------------------------
Corporation makes a timely exercise of the First Refusal Right with respect to a
portion, but not all, of the Target Shares specified in the Disposition Notice,
Owner shall have the option, exercisable by written notice to the Corporation
delivered within five (5) business days after Owner's receipt of the Exercise
Notice, to effect the sale of the Target Shares pursuant to either of the
following alternatives:

               (i) sale or other disposition of all the Target Shares to the
     third-party offeror identified in the Disposition Notice, but in full
     compliance with the requirements of Paragraph E.4, as if the Corporation
     did not exercise the First Refusal Right; or

               (ii) sale to the Corporation of the portion of the Target Shares
     which the Corporation has elected to purchase, such sale to be effected in
     substantial conformity with the provisions of Paragraph E.3. The First
     Refusal Right shall continue to be applicable to any subsequent disposition
     of the remaining Target Shares until such right lapses.

          Owner's failure to deliver timely notification to the Corporation
shall be deemed to be an election by Owner to sell the Target Shares pursuant to
alternative (i) above.

     6.   RECAPITALIZATION/REORGANIZATION.
          -------------------------------

Any new, substituted or additional securities or other property which is by
reason of any Recapitalization distributed with respect to the Purchased Shares
shall be immediately subject to the First Refusal Right, but only to the extent
the Purchased Shares are at the time covered by such right.

               (a) In the event of a Reorganization, the First Refusal Right
shall remain in full force and effect and shall apply to the new capital stock
or other property received in exchange for the Purchased Shares in consummation
of the Reorganization, but only to the extent the Purchased Shares are at the
time covered by such right.

                                       6
<PAGE>

          7.  LAPSE.  The First Refusal Right shall lapse upon the earliest to
              -----
occur of (i) the first date on which shares of the Common Stock are held of
record by more than five hundred (500) persons, (ii) a determination is made by
the Board that a public market exists for the outstanding shares of Common Stock
or (iii) a firm commitment underwritten public offering, pursuant to an
effective registration statement under the 1933 Act, covering the offer and sale
of the Common Stock in the aggregate amount of at least ten million dollars
($10,000,000). However, the Market Stand-Off shall continue to remain in full
force and effect following the lapse of the First Refusal Right.

     E.   SPECIAL TAX ELECTION
          --------------------

          1.  SECTION 83(b) ELECTION.  Under Code Section 83, the excess of
              ----------------------
the Fair Market Value of the Purchased Shares on the date any forfeiture
restrictions applicable to such shares lapse over the Purchase Price paid for
such shares will be reportable as ordinary income on the lapse date. For this
purpose, the term "forfeiture restrictions" includes the right of the
Corporation to repurchase the Purchased Shares pursuant to the Repurchase Right.
Participant may elect under Code Section 83(b) to be taxed at the time the
Purchased Shares are acquired, rather than when and as such Purchased Shares
cease to be subject to such forfeiture restrictions. Such election must be filed
with the Internal Revenue Service within thirty (30) days after the date of this
Agreement. Even if the Fair Market Value of the Purchased Shares on the date of
this Agreement equals the Purchase Price paid (and thus no tax is payable), the
election must be made to avoid adverse tax consequences in the future. THE FORM
FOR MAKING THIS ELECTION IS ATTACHED AS EXHIBIT II HERETO. PARTICIPANT
UNDERSTANDS THAT FAILURE TO MAKE THIS FILING WITHIN THE APPLICABLE THIRTY
(30)-DAY PERIOD WILL RESULT IN THE RECOGNITION OF ORDINARY INCOME AS THE
FORFEITURE RESTRICTIONS LAPSE.

          2.  FILING RESPONSIBILITY.  PARTICIPANT ACKNOWLEDGES THAT IT IS
              ---------------------
PARTICIPANT'S SOLE RESPONSIBILITY, AND NOT THE CORPORATION'S, TO FILE A TIMELY
ELECTION UNDER CODE SECTION 83(b), EVEN IF PARTICIPANT REQUESTS THE CORPORATION
OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS OR HER BEHALF.

     F.   GENERAL PROVISIONS
          ------------------

          1.  ASSIGNMENT.  The Corporation may assign the Repurchase Right
              ----------
and/or the First Refusal Right to any person or entity selected by the Board,
including (without limitation) one or more stockholders of the Corporation.

          2.  NO EMPLOYMENT OR SERVICE CONTRACT.  Nothing in this Agreement or
              ---------------------------------
in the Plan shall confer upon Participant any right to continue in Service for
any period of specific duration or interfere with or otherwise restrict in any
way the rights of the Corporation (or any Parent or Subsidiary employing or
retaining Participant) or of Participant, which rights are hereby expressly
reserved by each, to terminate Participant's Service at any time for any reason,
with or without cause.

                                       7
<PAGE>

          3.   NOTICES.  Any notice required to be given under this Agreement
               -------
shall be in writing and shall be deemed effective upon personal delivery or upon
deposit in the U.S. mail, registered or certified, postage prepaid and properly
addressed to the party entitled to such notice at the address indicated below
such party's signature line on this Agreement or at such other address as such
party may designate by ten (10) days advance written notice under this paragraph
to all other parties to this Agreement.

          4.   NO WAIVER.  The failure of the Corporation in any instance to
               ---------
exercise the Repurchase Right or the First Refusal Right shall not constitute a
waiver of any other repurchase rights and/or rights of first refusal that may
subsequently arise under the provisions of this Agreement or any other agreement
between the Corporation and Participant. No waiver of any breach or condition of
this Agreement shall be deemed to be a waiver of any other or subsequent breach
or condition, whether of like or different nature.

          5.   CANCELLATION OF SHARES.  If the Corporation shall make available,
               ----------------------
at the time and place and in the amount and form provided in this Agreement, the
consideration for the Purchased Shares to be repurchased in accordance with the
provisions of this Agreement, then from and after such time, the person from
whom such shares are to be repurchased shall no longer have any rights as a
holder of such shares (other than the right to receive payment of such
consideration in accordance with this Agreement). Such shares shall be deemed
purchased in accordance with the applicable provisions hereof, and the
Corporation shall be deemed the owner and holder of such shares, whether or not
the certificates therefor have been delivered as required by this Agreement.

     G.   MISCELLANEOUS PROVISIONS
          ------------------------

          1.   GOVERNING LAW.  This Agreement shall be governed by, and
               -------------
construed in accordance with, the laws of the State of California without resort
to that State's conflict-of-laws rules.

          2.   PARTICIPANT UNDERTAKING.  Participant hereby agrees to take
               -----------------------
whatever additional action and execute whatever additional documents the
Corporation may deem necessary or advisable in order to carry out or effect one
or more of the obligations or restrictions imposed on either Participant or the
Purchased Shares pursuant to the provisions of this Agreement.

          3.   AGREEMENT IS ENTIRE CONTRACT.  This Agreement constitutes the
               ----------------------------
entire contract between the parties hereto with regard to the subject matter
hereof. This Agreement is made pursuant to the provisions of the Plan and shall
in all respects be construed in conformity with the terms of the Plan.

          4.   COUNTERPARTS.  This Agreement may be executed in counterparts,
               ------------
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.

          5.  SUCCESSORS AND ASSIGNS.  The provisions of this Agreement shall
              ----------------------
inure to the benefit of, and be binding upon, the Corporation and its successors
and assigns and upon Participant, Participant's assigns and the legal
representatives, heirs and legatees of Participant's

                                       8
<PAGE>

estate, whether or not any such person shall have become a party to this
Agreement and have agreed in writing to join herein and be bound by the terms
hereof.

          IN WITNESS WHEREOF, the parties have executed this Agreement on the
day and year first indicated above.

                                 PRIME RESPONSE GROUP, INC.



                              Title:
                                     ------------------------------

                              Address:
                                       ----------------------------

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





                              -------------------------------------
                              PARTICIPANT

                              Address:
                                       ----------------------------

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



                                       9
<PAGE>

                            SPOUSAL ACKNOWLEDGMENT

          The undersigned spouse of Participant has read and hereby approves the
foregoing Stock Issuance Agreement.  In consideration of the Corporation's
granting Participant the right to acquire the Purchased Shares in accordance
with the terms of such Agreement, the undersigned hereby agrees to be
irrevocably bound by all the terms of such Agreement, including (without
limitation) the right of the Corporation (or its assigns) to purchase any
Purchased Shares in which Participant is not vested at the time of his or her
cessation of Service.



                             ------------------------------
                             PARTICIPANT'S SPOUSE

                                       10
<PAGE>

                                   EXHIBIT I

                     ASSIGNMENT SEPARATE FROM CERTIFICATE

          FOR VALUE RECEIVED ______________________________________________
 hereby sell(s), assign(s) and transfer(s) unto Prime Response Group, Inc. (the
"Corporation"), ______________________ (_______) shares of the Common Stock of
the Corporation standing in his or her name on the books of the Corporation
represented by Certificate No. ___________________ herewith and do(es) hereby
irrevocably constitute and appoint _______________________________ Attorney to
transfer the said stock on the books of the Corporation with full power of
substitution in the premises.


Dated:  ________________


                         Signature
                                   ---------------------------------------------





INSTRUCTION:  Please do not fill in any blanks other than the signature line.
Please sign exactly as you would like your name to appear on the issued stock
certificate.  The purpose of this assignment is to enable the Corporation to
exercise the Repurchase Right without requiring additional signatures on the
part of Participant.
<PAGE>

                                  EXHIBIT II

                          SECTION 83(b) TAX ELECTION
<PAGE>

                          SECTION 83(b) TAX ELECTION

This statement is being made under Section 83(b) of the Internal Revenue Code,
pursuant to Treas. Reg. Section 1.83-2.

(1)  The taxpayer who performed the services is:

     Name:
     Address:
     Taxpayer Ident. No.:

(2)  The property with respect to which the election is being made is
     shares of the common stock of Prime Response Group, Inc.

(3)  The property was issued on _____________________, 199____.

(4)  The taxable year in which the election is being made is the calendar year
     1998.

(5)  The property is subject to a repurchase right pursuant to which the issuer
     has the right to acquire the property at the original purchase price if for
     any reason taxpayer's service with the issuer terminates.  The issuer's
     repurchase right lapses in a series of annual and monthly installments over
     a four (4)-year period ending on _____________________, 200_____.

(6)  The fair market value at the time of transfer (determined without regard to
     any restriction other than a restriction which by its terms will never
     lapse) is $______ per share.

(7)  The amount paid for such property is $ ________ per share.

(8)  A copy of this statement was furnished to Prime Response Group, Inc. for
     whom taxpayer rendered the services underlying the transfer of property.

(9)  This statement is executed on _____________________, 199____.



--------------------------------------------------------------------------------
Spouse (if any)        Taxpayer

This election must be filed with the Internal Revenue Service Center with which
taxpayer files his or her Federal income tax returns and must be made within
thirty (30) days after the execution date of the Stock Issuance Agreement.  This
filing should be made by registered or certified mail, return receipt requested.
Participant must retain two (2) copies of the completed form for filing with his
or her Federal and state tax returns for the current tax year and an additional
copy for his or her records.
<PAGE>

                                  EXHIBIT III

                     1998 STOCK OPTION/STOCK ISSUANCE PLAN
<PAGE>

                                   APPENDIX
                                   --------


          The following definitions shall be in effect under the Agreement:

          A.   AGREEMENT shall mean this Stock Issuance Agreement.
               ---------

          B.   BOARD shall mean the Corporation's Board of Directors.
               -----

          C.   CODE shall mean the Internal Revenue Code of 1986, as amended.
               ----

          D.   COMMON STOCK shall mean the Corporation's common stock.
               ------------

          E.   CORPORATE TRANSACTION shall mean either of the following
               ---------------------
stockholder-approved transactions:

               (i) a merger or consolidation in which securities possessing more
     than fifty percent (50%) of the total combined voting power of the
     Corporation's outstanding securities are transferred to a person or persons
     different from the persons holding those securities immediately prior to
     such transaction, or

               (ii) the sale, transfer or other disposition of all or
     substantially all of the Corporation's assets in complete liquidation or
     dissolution of the Corporation.

          F.   CORPORATION shall mean Prime Response Group, Inc., a Delaware
               -----------
corporation.

          G.   DISPOSITION NOTICE shall have the meaning assigned to such term
               ------------------
in Paragraph E.2.

          H.   EXERCISE NOTICE shall have the meaning assigned to such term in
               ---------------
Paragraph E.3.

          I.   FAIR MARKET VALUE of a share of Common Stock on any relevant
               -----------------
date, prior to the initial public offering of the Common Stock, shall be
determined by the Plan Administrator after taking into account such factors as
it shall deem appropriate.

          J.   FIRST REFUSAL RIGHT shall mean the right granted to the
               -------------------
Corporation in accordance with Article E.

          K.   MARKET STAND-OFF shall mean the market stand-off restriction
               ----------------
specified in Paragraph C.3.

          L.   1933 ACT shall mean the Securities Act of 1933, as amended.
               --------

                                      A-1
<PAGE>

          M.   OWNER shall mean Participant and all subsequent holders of the
               -----
Purchased Shares who derive their chain of ownership through a Permitted
Transfer from Participant.

          N.   PARENT shall mean any corporation (other than the Corporation) in
               ------
an unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the time
of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

          O.   PARTICIPANT shall mean the person to whom shares are issued under
               -----------
the Stock Issuance Program.

          P.   PERMITTED TRANSFER shall mean (i) a gratuitous transfer of the
               ------------------
Purchased Shares, provided and only if Participant obtains the Corporation's
prior written consent to such transfer, (ii) a transfer of title to the
Purchased Shares effected pursuant to Participant's will or the laws of
intestate succession following Participant's death or (iii) a transfer to the
Corporation in pledge as security for any purchase-money indebtedness incurred
by Participant in connection with the acquisition of the Purchased Shares.

          Q.   PLAN shall mean the Corporation's 1998 Stock Option/Stock
               ----
Issuance Plan attached hereto as Exhibit III.

          R.   PLAN ADMINISTRATOR shall mean either the Board or a committee of
               ------------------
the Board acting in its capacity as administrator of the Plan.

          S.   PURCHASE PRICE shall have the meaning assigned to such term in
               --------------
Paragraph A.1.

          T.   PURCHASED SHARES shall have the meaning assigned to such term in
               ----------------
Paragraph A.1.

          U.   RECAPITALIZATION shall mean any stock split, stock dividend,
               ----------------
recapitalization, combination of shares, exchange of shares or other change
affecting the Corporation's outstanding Common Stock as a class without the
Corporation's receipt of consideration.

          V.   REORGANIZATION shall mean any of the following transactions:
               --------------

               (i) a merger or consolidation in which the Corporation is not the
     surviving entity,

               (ii) a sale, transfer or other disposition of all or
     substantially all of the Corporation's assets,

                                      A-2
<PAGE>

               (iii) a reverse merger in which the Corporation is the surviving
     entity but in which the Corporation's outstanding voting securities are
     transferred in whole or in part to a person or persons different from the
     persons holding those securities immediately prior to the merger, or

               (iv) any transaction effected primarily to change the state in
     which the Corporation is incorporated or to create a holding company
     structure.

          W.   REPURCHASE RIGHT shall mean the right granted to the Corporation
               ----------------
in accordance with Article D.

          X.   SEC shall mean the Securities and Exchange Commission.
               ---

          Y.   SERVICE shall mean the Participant's performance of services for
               -------
the Corporation (or any Parent or Subsidiary) in the capacity of an employee,
subject to the control and direction of the employer entity as to both the work
to be performed and the manner and method of performance, a non-employee member
of the board of directors or an independent consultant.

          Z.   STOCK ISSUANCE PROGRAM shall mean the Stock Issuance Program
               ----------------------
under the Plan.

          AA.  SUBSIDIARY shall mean any corporation (other than the
               ----------
Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in the
unbroken chain owns, at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain.

          BB.  TARGET SHARES shall have the meaning assigned to such term in
               -------------
Paragraph E.2.

          CC.  VESTING SCHEDULE shall mean the vesting schedule specified in
               ----------------
Paragraph D.3 pursuant to which Participant is to vest in the Purchased Shares
in a series of installments over the Participant's period of Service.

          DD.  UNVESTED SHARES shall have the meaning assigned to such term in
               ---------------
Paragraph D.1.


                                      A-3
<PAGE>

                                   ADDENDUM

                                      TO

                           STOCK ISSUANCE AGREEMENT

          The following provisions are hereby incorporated into, and are hereby
made a part of, that certain Stock Issuance Agreement dated            , 199
(the "Issuance Agreement") by and between Prime Response Group, Inc. (the
"Corporation") and                ("Participant") evidencing the shares of
Common Stock purchased on such date by Participant pursuant to the shares
granted to him or her under the Corporation's 1998 Stock Option/Stock Issuance
Plan, and such provisions shall be effective immediately. All capitalized terms
in this Addendum, to the extent not otherwise defined herein, shall have the
meanings assigned to such terms in the Issuance Agreement.

                       INVOLUNTARY TERMINATION FOLLOWING

                             CORPORATE TRANSACTION

          1. To the extent the Repurchase Right is assigned to the successor
corporation (or parent thereof) in connection with a Corporate Transaction, no
accelerated vesting of the Purchased Shares shall occur upon such Corporate
Transaction, and the Repurchase Right shall continue to remain in full force and
effect in accordance with the provisions of the Issuance Agreement. Participant
shall, over his or her period of Service following the Corporate Transaction,
continue to vest in the Purchased Shares in one or more installments in
accordance with the provisions of the Issuance Agreement. However, upon an
Involuntary Termination of Participant's Service within eighteen (18) months
following the Corporate Transaction, the Repurchase Right shall terminate
automatically and all the Purchased Shares shall immediately vest in full.

          2. For purposes of this Addendum, the following definitions shall be
in effect:

          An INVOLUNTARY TERMINATION shall mean the termination of
Participant's Service by reason of:

          a. Participant's involuntary dismissal or discharge by the Corporation
     for reasons other than for Misconduct, or

          b. Participant's voluntary resignation following (A) a change in his
     or her position with the Corporation (or Parent or Subsidiary employing
     Participant) which materially reduces his or her duties and
     responsibilities or the level of management to which he or she reports,
     (B) a reduction in Participant's level of compensation (including base
     salary, fringe benefits and target bonuses under any corporate-performance
     based incentive programs) by more than fifteen percent (15%) or (C) a
     relocation of Participant's place of employment by more than fifty (50)
     miles, provided and only if such change, reduction or relocation is
     effected by the Corporation without Participant's consent.
<PAGE>

          MISCONDUCT shall include the termination of Participant's Service  by
reason or Participant's commission of any act of fraud, embezzlement or
dishonesty, any unauthorized use or disclosure by Participant of confidential
information or trade secrets of the Corporation (or any Parent or Subsidiary),
or any other intentional misconduct by Participant adversely affecting the
business or affairs of the Corporation (or any Parent or Subsidiary) in a
material manner.  The foregoing definition shall not be deemed to be inclusive
of all the acts or omissions which the Corporation (or any Parent or Subsidiary)
may consider as grounds for the dismissal or discharge of the Participant or any
other individual in the Service of the Corporation (or any Parent or
Subsidiary).

          IN WITNESS WHEREOF, Prime Response Group, Inc. has caused this
Addendum to be executed by its duly-authorized officer as of the Effective Date
specified below.



                              PRIME RESPONSE GROUP, INC.


                              By:
                                     ------------------------------

                              Title:
                                     ------------------------------





EFFECTIVE DATE:                        , 199
                -----------------------     ----


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