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                                                                    EXHIBIT 10.3

                        SKILLSOFT PUBLIC LIMITED COMPANY

                    DIRECTOR OPTION AGREEMENT - FIRST OPTION

      SkillSoft Public Limited Company (the "Company") has granted to [______]
the "Optionee"), an option to purchase a total of [______] of the Company's
ordinary shares (the "Optioned Shares"), at the price determined as provided
herein, and in all respects subject to the terms, definitions and provisions of
the Company's 2001 Director Option Plan (the "Plan") adopted by the Company
which is incorporated herein by reference. The terms defined in the Plan shall
have the same defined meanings herein.

      1.    Nature of the Option. This Option is a non-statutory stock option
and is not intended to qualify for any special tax benefits to the Optionee.

      2.    Exercise Price. The exercise price is [______] for each Optioned
Share.

      3.    Exercise of Option. This Option shall be exercisable during its term
in accordance with the provisions of Section 8 of the Plan as follows:

            (i)   Right to Exercise.

                  (a)   This Option shall become exercisable in installments
cumulatively with respect to twenty-five percent (25%) of the Optioned Shares
each anniversary of its date of grant, so that this Option shall be exercisable
with respect to one hundred percent (100%) of the Optioned Shares four (4) years
after the date of grant, provided that the Optionee continues to serve as a
Director on all such relevant dates; and provided further, that in no event
shall any Option be exercisable prior to the date the shareholders of the
Company approve the Plan.

                  (b)   This Option may not be exercised for a fraction of a
share.

                  (c)   In the event of the Optionee's death, Disability or
other termination of service as a Director, the exercisability of the Option is
governed by Section 8 of the Plan.

            (ii)  Method of Exercise. This Option shall be exercisable by
written notice, which shall state the election to exercise the Option and the
number of Optioned Shares in respect of which the Option is being exercised.
Such written notice, in the form attached hereto as Exhibit A, shall be signed
by the Optionee and shall be delivered in person or by certified mail to the
Secretary of the Company. The written notice shall be accompanied by payment of
the exercise price.

      4.    Method of Payment. Payment of the exercise price shall be by any of
the following, or a combination thereof, at the election of the Optionee:

            (i)   cash;

            (ii)  check; or

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            (iii) cashless exercise under a cashless exercise program (if any)
implemented by the Company in connection with the Plan.

      5.    Restrictions on Exercise. This Option may not be exercised if the
issuance of the Optioned Shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any applicable
federal or state securities or other law or regulations, including without
limitation Irish law, or if such issuance would not comply with the requirements
of any stock exchange upon which the Shares may then be listed. As a condition
to the exercise of this Option, the Company may require the Optionee to make any
representation and warranty to the Company as may be required by any applicable
law or regulation.

      6.    Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of the Optionee only by the Optionee or, in
the event of the Optionee's Incapacity, by his or her Attorney. The terms of
this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.

      7.    Term of Option. This Option may not be exercised after the period of
ten (10) years commencing on the date of grant of this Option, and may be
exercised during such period only in accordance with the Plan and the terms of
this Option.

      8.    Taxation Upon Exercise of Option. Optionee understands that, upon
exercise of this Option, he or she will recognize income for tax purposes in an
amount equal to the excess of the then Fair Market Value of the Optioned Shares
purchased over the exercise price paid for such Optioned Shares. Upon a resale
of such Optioned Shares by the Optionee, any difference between the sale price
and the Fair Market Value of the Optioned Shares on the date of exercise of the
Option, to the extent not included in income as described above, will be treated
as capital gain or loss.

DATE OF GRANT: [______]

                                       SKILLSOFT PUBLIC LIMITED COMPANY,

                                       a public limited company organized under
                                       the laws of the Republic of Ireland

                                       By:____________________________________

      The Optionee acknowledges receipt of a copy of the Plan, a copy of which
is attached hereto, and represents that he or she is familiar with the terms and
provisions thereof, and hereby accepts this Option subject to all of the terms
and provisions thereof. The Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Board upon any
questions arising under the Plan.

      Dated: _________________

                                       _______________________________________
                                       Optionee

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                                    EXHIBIT A

                         DIRECTOR OPTION EXERCISE NOTICE

SkillSoft Public Limited Company
20 Industrial Park Drive
Nashua
NH 03062
USA

      Attention: Company Secretary

      1.    Exercise of Option. The undersigned ("Optionee") hereby elects to
exercise Optionee's option to purchase ______ Ordinary Shares (the "Shares") of
SkillSoft Public Limited Company (the "Company") under and pursuant to the
Company's 2001 Outside Director Option Plan and the Director Option Agreement
dated _______________ (the "Agreement").

            The Optionee hereby elects to have the Shares issued in the name of
            (check one):

            [ ]   AIB Custodial Nominees Limited A/C BONY as Optionee's nominee
                  to hold the Shares on Optionee's behalf and subject to
                  Optionee's directions. (If selected, the share certificate
                  shall be mailed at Optionee's risk to AIB Custodial Nominees
                  Limited, P.O. Box 518, IFSC, Dublin 1, Ireland).

            [ ]   Optionee. (If selected, the share certificate shall be mailed
                  at Optionee's risk to the address specified below).

      2.    Representations of Optionee. Optionee acknowledges that Optionee has
received, read and understood the Agreement.

      3.    Federal Restrictions on Transfer. Optionee understands that the
Shares must be held indefinitely unless they are registered under the Securities
Act of 1933, as amended (the "1933 Act"), or unless an exemption from such
registration is available, and that the certificate(s) representing the Shares
may bear a legend to that effect. Optionee understands that the Company is under
no obligation to register the Shares and that an exemption may not be available
or may not permit Optionee to transfer the Shares in the amounts or at the times
proposed by Optionee.

      4.    Tax Consequences. Optionee understands that Optionee may suffer
adverse tax consequences as a result of Optionee's purchase or disposition of
the Shares. Optionee represents that Optionee has consulted with any tax
consultant(s) Optionee deems advisable in connection with the purchase or
disposition of the Shares and that Optionee is not relying on the Company for
any tax advice.

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      5.    Delivery of Payment. Optionee herewith delivers to the Company the
aggregate purchase price for the Shares that Optionee has elected to purchase
and has made provision for the payment of any federal or state withholding taxes
required to be paid or withheld by the Company.

      6.    Entire Agreement. The Agreement is incorporated herein by reference.
This Exercise Notice and the Agreement constitute the entire agreement of the
parties and supersede in their entirety all prior undertakings and agreements of
the Company and Optionee with respect to the subject matter hereof. This
Exercise Notice and the Agreement are governed by Irish law except for that body
of law pertaining to conflict of laws.

Submitted by:                              Accepted by:

OPTIONEE:                                  SKILLSOFT PUBLIC LIMITED COMPANY

By: ___________________________________    By: _________________________________

                                           Its: ________________________________
Address:

_______________________________________
_______________________________________
_______________________________________

Dated: ________________________________    Dated: ______________________________

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