<PAGE>

                                                                    Exhibit 10.3
                                                                   U.K. OPTIONEE

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



RECITALS
--------

         A. The Board has adopted the Plan for the purpose of retaining the
services of selected Employees, non-employee members of the Board or the board
of directors of any Parent or Subsidiary and consultants and other independent
advisors in the service of the Corporation (or any Parent or Subsidiary).

         B. Optionee is to render valuable services to the Corporation (or a
Parent or Subsidiary), and this Agreement is executed pursuant to, and is
intended to carry out the purposes of, the Plan in connection with the
Corporation's grant of an option to Optionee.

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

         NOW, THEREFORE, it is hereby agreed as follows:

         1. Grant of Option. The Corporation hereby grants to Optionee, as of
            ---------------
the Grant Date, an option to purchase up to the number of Option Shares
specified in the Grant Notice. The Option Shares shall be purchasable from time
to time during the option term specified in Paragraph 2 at the Exercise Price.

         2. Option Term. This option shall have a term of ten (10) years
            -----------
measured from the Grant Date and shall accordingly expire at the close of
business on the Expiration Date, unless sooner terminated in accordance with
Paragraph 5 or 6.

         3. Limited Transferability. During Optionee's lifetime, this option
            -----------------------
shall be exercisable only by Optionee and shall not be assignable or
transferable other than by will or by the laws of descent and distribution
following Optionee's death.

         4. Dates of Exercise. This option shall become exercisable for the
            -----------------
Option Shares in one or more installments as specified in the Grant Notice. As
the option becomes exercisable for such installments, those installments shall
accumulate, and the option shall remain exercisable for the accumulated
installments until the Expiration Date or sooner termination of the option term
under Paragraph 5 or 6.

         5. Cessation of Service. The option term specified in Paragraph 2 shall
            --------------------
terminate (and this option shall cease to be outstanding) prior to the
Expiration Date should any of the following provisions become applicable:

            (a) Should Optionee cease to remain in Service for any reason (other
than death, Disability or Misconduct) while this option is outstanding, then
Optionee shall have a
<PAGE>

period of three (3) months (commencing with the date of such cessation of
Service) during which to exercise this option, but in no event shall this option
be exercisable at any time after the Expiration Date.

            (b) Should Optionee die while this option is outstanding, then the
personal representative of Optionee's estate or the person or persons to whom
the option is transferred pursuant to Optionee's will or in accordance with the
laws of inheritance shall have the right to exercise this option. Such right
shall lapse, and this option shall cease to be outstanding, upon the earlier of
(i) the expiration of the twelve (12)-month period measured from the date of
Optionee's death or (ii) the Expiration Date.

            (c) Should Optionee cease Service by reason of Disability while this
option is outstanding, then Optionee shall have a period of twelve (12) months
(commencing with the date of such cessation of Service) during which to exercise
this option. In no event shall this option be exercisable at any time after the
Expiration Date.

            (d) During the limited period of post-Service exercisability, this
option may not be exercised in the aggregate for more than the number of vested
Option Shares for which the option is exercisable at the time of Optionee's
cessation of Service. Upon the expiration of such limited exercise period or (if
earlier) upon the Expiration Date, this option shall terminate and cease to be
outstanding for any vested Option Shares for which the option has not been
exercised. To the extent Optionee is not vested in the Option Shares at the time
of Optionee's cessation of Service, this option shall immediately terminate and
cease to be outstanding with respect to those shares.

            (e) Should Optionee's Service be terminated for Misconduct, then
this option shall terminate immediately and cease to remain outstanding.

         6. Accelerated Vesting.
         -- -------------------
            (a) In the event of any Corporate Transaction, the Option Shares at
the time subject to this option but not otherwise fully exercisable, shall
automatically accelerate so that this option shall, immediately prior to the
effective date of the Corporate Transaction, become exercisable for any or all
of the Option Shares at the time subject to this option as fully-vested shares
of Common Stock. However, no such acceleration of this option shall occur if and
to the extent: (i) this option is assumed by the successor corporation (or
parent thereof) in the Corporate Transaction (or parent thereof) or (ii) this
option is to be replaced with a cash incentive program of the successor
corporation which preserves the spread existing on the Option Shares for which
this option is not otherwise at that time exercisable (the excess of the Fair
Market Value of those Option Shares over the aggregate Exercise Price payable
for such shares) and provides for subsequent payout in accordance with the same
exercise schedule in effect for the option pursuant to the exercise schedule set
forth in the Grant Notice.

            (b) Immediately following the Corporate Transaction, this option
shall terminate and cease to be outstanding, except to the extent assumed by the
successor corporation (or parent thereof) in connection with the Corporate
Transaction.

                                       2
<PAGE>

            (c) If this option is assumed in connection with a Corporate
Transaction, then this option shall be appropriately adjusted, immediately after
such Corporate Transaction, to apply to the number and class of securities which
would have been issuable to Optionee in consummation of such Corporate
Transaction had the option been exercised immediately prior to such Corporate
Transaction, and appropriate adjustments shall also be made to the Exercise
Price, provided the aggregate Exercise Price shall remain the same.

            (d) The exercisability of this option may also accelerate in
accordance with the terms and conditions of any special addendum attached to
this Agreement.

            (e) This Agreement shall not in any way affect the right of the
Corporation to adjust, reclassify, reorganize or otherwise change its capital or
business structure or to merge, consolidate, dissolve, liquidate or sell or
transfer all or any part of its business or assets.

         7. Adjustment in Option Shares. Should any change be made to the
            ---------------------------
Common Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation's receipt of
consideration, appropriate adjustments shall be made to (i) the total number
and/or class of securities subject to this option and (ii) the Exercise Price in
order to reflect such change and thereby preclude a dilution or enlargement of
benefits hereunder.

         8. Stockholder Rights. The holder of this option shall not have any
            ------------------
stockholder rights with respect to the Option Shares until such person shall
have exercised the option, paid the Exercise Price and become the record holder
of the purchased shares.

         9. Manner of Exercising Option.
         -- ---------------------------
            (a) In order to exercise this option with respect to all or any part
of the Option Shares for which this option is at the time exercisable, Optionee
(or any other person or persons exercising the option) must take the following
actions:

                (i) Execute and deliver to the Corporation a Purchase Agreement
     for the Option Shares for which the option is exercised.

                (ii) Pay the aggregate Exercise Price for the purchased shares
     in one or more of the following forms:

                     (A) cash or check made payable to the Corporation; or

                     (B) a promissory note payable to the Corporation, but only
     to the extent authorized by the Plan Administrator in accordance with
     Paragraph 14.

            Should the Common Stock be registered under Section 12 of the
     1934 Act at the time the option is exercised, then the Exercise Price may
     also be paid as follows:

                                       3
<PAGE>

                     (C) in shares of Common Stock held by Optionee (or any
     other person or persons exercising the option) for the requisite period
     necessary to avoid a charge to the Corporation's earnings for financial
     reporting purposes and valued at Fair Market Value on the Exercise Date; or

                     (D) to the extent the option is exercised for vested Option
     Shares, through a special sale and remittance procedure pursuant to which
     Optionee (or any other person or persons exercising the option) shall
     concurrently provide irrevocable instructions (a) to a Corporation-
     designated brokerage firm to effect the immediate sale of the purchased
     shares and remit to the Corporation, out of the sale proceeds available on
     the settlement date, sufficient funds to cover the aggregate Exercise Price
     payable for the purchased shares plus all applicable Federal, state and
     local income and employment taxes required to be withheld by the
     Corporation by reason of such exercise and (b) to the Corporation to
     deliver the certificates for the purchased shares directly to such
     brokerage firm in order to complete the sale.

           Except to the extent the sale and remittance procedure is utilized in
     connection with the option exercise, payment of the Exercise Price must
     accompany the Purchase Agreement delivered to the Corporation in connection
     with the option exercise.

                (iii) Furnish to the Corporation appropriate documentation that
the person or persons exercising the option (if other than Optionee) have the
right to exercise this option.

                (iv) Execute and deliver to the Corporation such written
representations as may be requested by the Corporation in order for it to comply
with the applicable requirements of Federal and state securities laws.

                (v) Make appropriate arrangements with the Corporation (or
Parent or Subsidiary employing or retaining Optionee) for the satisfaction of
all Federal, state and local income and employment tax withholding requirements
applicable to the option exercise.

                     (b) As soon as practical after the Exercise Date, the
Corporation shall issue to or on behalf of Optionee (or any other person or
persons exercising this option) a certificate for the purchased Option Shares,
with the appropriate legends affixed thereto.

                     (c) In no event may this option be exercised for any
fractional shares.

            10. Compliance with Laws and Regulations.
            --- ------------------------------------

                (a) The exercise of this option and the issuance of the
Option Shares upon such exercise shall be subject to compliance by the
Corporation and Optionee with all applicable requirements of law relating
thereto and with all applicable regulations of any stock exchange (or the Nasdaq
National Market, if applicable) on which the Common Stock may be listed for
trading at the time of such exercise and issuance.

                                       4
<PAGE>

                (b) The inability of the Corporation to obtain approval from any
regulatory body having authority deemed by the Corporation to be necessary to
the lawful issuance and sale of any Common Stock pursuant to this option shall
relieve the Corporation of any liability with respect to the non-issuance or
sale of the Common Stock as to which such approval shall not have been obtained.
The Corporation, however, shall use its best efforts to obtain all such
approvals.

            11. Successors and Assigns. Except to the extent otherwise provided
                ----------------------
in Paragraphs 3 and 6, the provisions of this Agreement shall inure to the
benefit of, and be binding upon, the Corporation and its successors and assigns
and Optionee, Optionee's assigns and the legal representatives, heirs and
legatees of Optionee's estate.

            12. Notices. Any notice required to be given or delivered to the
                -------
Corporation under the terms of this Agreement shall be in writing and addressed
to the Corporation at its principal corporate offices. Any notice required to be
given or delivered to Optionee shall be in writing and addressed to Optionee at
the address indicated below Optionee's signature line on the Grant Notice. All
notices shall be deemed effective upon personal delivery or upon deposit in the
U.S. mail, postage prepaid and properly addressed to the party to be notified.

            13. Financing. The Plan Administrator may, in its absolute
                ---------
discretion and without any obligation to do so, permit Optionee to pay the
Exercise Price for the purchased Option Shares by delivering a full-recourse,
interest-bearing promissory note secured by those Option Shares. The payment
schedule in effect for any such promissory note shall be established by the Plan
Administrator in its sole discretion.

            14. Construction. This Agreement and the option evidenced hereby are
                ------------
made and granted pursuant to the Plan and are in all respects limited by and
subject to the terms of the Plan. All decisions of the Plan Administrator with
respect to any question or issue arising under the Plan or this Agreement shall
be conclusive and binding on all persons having an interest in this option.

            15. Governing Law. The interpretation, performance and enforcement
                -------------
of this Agreement shall be governed by the laws of the State of California
without resort to that State's conflict-of-laws rules.

            16. Stockholder Approval. If the Option Shares covered by this
                --------------------
Agreement exceed, as of the Grant Date, the number of shares of Common Stock
which may be issued under the Plan as last approved by the stockholders, then
this option shall be void with respect to such excess shares, unless stockholder
approval of an amendment sufficiently increasing the number of shares of Common
Stock issuable under the Plan is obtained in accordance with the provisions of
the Plan.

                                       5
<PAGE>

                                   APPENDIX
                                   --------


            The following definitions shall be in effect under the Agreement:

            A.  Agreement shall mean this Stock Option 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 to which the Corporation is a party:

                (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. Disability shall mean the inability of Optionee to engage in any
               ----------
substantial gainful activity by reason of any medically determinable physical or
mental impairment and shall be determined by the Plan Administrator on the basis
of such medical evidence as the Plan Administrator deems warranted under the
circumstances. Disability shall be deemed to constitute Permanent Disability in
the event that such Disability is expected to result in death or has lasted or
can be expected to last for a continuous period of twelve (12) months or more.

            H. Employee shall mean an individual who is in the employ of the
               --------
Corporation (or any Parent or Subsidiary), 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.

            I. Exercise Date shall mean the date on which the option shall have
               -------------
been exercised in accordance with Paragraph 9 of the Agreement.

            J. Exercise Price shall mean the exercise price payable per Option
               --------------
Share as specified in the Grant Notice.

            K. Expiration Date shall mean the date on which the option expires
               ---------------
as specified in the Grant Notice.
<PAGE>

            L. Fair Market Value per share of Common Stock on any relevant date
               -----------------
shall be determined in accordance with the following provisions:

                (i) If the Common Stock is at the time traded on the Nasdaq
       National Market, then the Fair Market Value shall be the closing selling
       price per share of Common Stock on the date in question, as the price is
       reported by the National Association of Securities Dealers on the Nasdaq
       National Market. If there is no closing selling price for the Common
       Stock on the date in question, then the Fair Market Value shall be the
       closing selling price on the last preceding date for which such quotation
       exists.

                (ii) If the Common Stock is at the time listed on any Stock
       Exchange, then the Fair Market Value shall be the closing selling price
       per share of Common Stock on the date in question on the Stock Exchange
       determined by the Plan Administrator to be the primary market for the
       Common Stock, as such price is officially quoted in the composite tape of
       transactions on such exchange. If there is no closing selling price for
       the Common Stock on the date in question, then the Fair Market Value
       shall be the closing selling price on the last preceding date for which
       such quotation exists.

                (iii) If the Common Stock is at the time neither listed on any
       Stock Exchange nor traded on the Nasdaq National Market, then the Fair
       Market Value shall be determined by the Plan Administrator after taking
       into account such factors as the Plan Administrator shall deem
       appropriate.

            M. Grant Date shall mean the date of grant of the option as
               ----------
specified in the Grant Notice.

            N. Grant Notice shall mean the Notice of Grant of Stock Option
               ------------
accompanying the Agreement, pursuant to which Optionee has been informed of the
basic terms of the option evidenced hereby.

            O. Misconduct shall mean the commission of any act of fraud,
               ----------
embezzlement or dishonesty by Optionee, any unauthorized use or disclosure by
Optionee of confidential information or trade secrets of the Corporation (or any
Parent or Subsidiary), or any other intentional misconduct by Optionee 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
Optionee or any other individual in the Service of the Corporation (or any
Parent or Subsidiary).

            P. 1934 Act shall mean the Securities Exchange Act of 1934, as
               --------
amended.

            Q. Non-statutory option shall mean an option not intended to satisfy
               --------------------
the requirements of Code Section 422.

            R. Option Shares shall mean the number of shares of Common Stock
               -------------
subject to the option.

                                       2
<PAGE>

            S. Optionee shall mean the person to whom the option is granted as
               --------
specified in the Grant Notice.

            T. 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.

            U. Plan shall mean the Corporation's 1998 Stock Option/Stock
               ----
Issuance Plan.

            V. Plan Administrator shall mean either the Board or a committee of
               ------------------
the Board acting in its capacity as administrator of the Plan.

            W. Purchase Agreement shall mean the stock purchase agreement in
               ------------------
substantially the form of Exhibit B to the Grant Notice.

            X. Service shall mean the Optionee's performance of services for the
               -------
Corporation (or any Parent or Subsidiary) in the capacity of an Employee, a non-
employee member of the board of directors or an independent consultant.

            Y. Stock Exchange shall mean the American Stock Exchange or the
               --------------
New York Stock Exchange.

            Z. 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.

                                       3
<PAGE>

                                                                   U.K. OPTIONEE


                                    ADDENDUM
                                       TO
                             STOCK OPTION AGREEMENT


     The following provisions are hereby incorporated into, and are hereby
made a part of, that certain Stock Option Agreement dated       , 199___ (the
"Option Agreement") by and between Prime Response Group, Inc. (the
"Corporation") and ________________________       ("Optionee") evidencing the
stock option (the "Option") granted on such date to Optionee under the terms of
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 them in
the Option Agreement.

                       INVOLUNTARY TERMINATION FOLLOWING

                             CORPORATE TRANSACTION

     1.  To the extent the Option is, in connection with a Corporate
Transaction, to be assumed in accordance with Paragraph 6 of the Option
Agreement, the exercisability of the Option shall not accelerate upon the
occurrence of that Corporate Transaction, and the Option shall, over Optionee's
continued period of Service following the Corporate Transaction, continue to
become exercisable for the Option Shares in accordance with the provisions of
the Option Agreement. However, upon an Involuntary Termination of Optionee's
Service within eighteen (18) months following such Corporate Transaction, the
exercisability of this Option, to the extent the Option is at the time
outstanding but not otherwise fully exercisable, shall automatically accelerate
so that the Option shall immediately become fully exercisable for all the Option
Shares at the time subject to the Option and may be exercised for any or all of
those shares as fully vested shares of Common Stock at any time prior to the
earlier of (i) the Expiration Date or (ii) the expiration of the one (1)-year
period measured from the date of the Involuntary Termination.

     2.  For purposes of this Addendum, an INVOLUNTARY TERMINATION shall mean
the termination of Optionee's Service by reason of:

         (i)  Optionee's involuntary dismissal or discharge by the Corporation
     for reasons other than for Misconduct, or

         (ii) Optionee's voluntary resignation following (A) a change in
     Optionee's position with the Corporation (or Parent or Subsidiary employing
     Optionee) which materially reduces Optionee's duties and responsibilities
     or the level of management to which he or she reports, (B) a reduction in
     Optionee'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
     Optionee'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 Optionee's consent.




<PAGE>

     3.  The provisions of Paragraph 1 of this Addendum shall govern the period
for which the Option is to remain exercisable following the Involuntary
Termination of Optionee's Service within eighteen (18) months after the
Corporate Transaction and shall supersede any provisions to the contrary in
Paragraph 5 of the Option Agreement. The provisions of this Addendum shall also
supersede any provisions to the contrary in Paragraph 18 of the Option Agreement
concerning the deferred exercisability of the Option.

          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__