Exhibit 4.18

                  AMENDED AND RESTATED COMMTOUCH SOFTWARE LTD.
                  1999 NONEMPLOYEE DIRECTORS STOCK OPTION PLAN


         1.       PURPOSE.

                  The purpose of this Plan is to offer Nonemployee  Directors of
CommTouch Software Ltd. an opportunity to acquire a proprietary  interest in the
success of the Company,  or to increase such  interest,  by purchasing  Ordinary
Shares of the Company.  This Plan  provides for the grant of Options to purchase
Shares. Options granted hereunder shall be "Nonstatutory Options," and shall not
include  "incentive  stock  options"  intended  to qualify for  treatment  under
Sections 421 and 422 of the Internal Revenue Code of 1986, as amended.

         2.       DEFINITIONS.

                  As used herein, the following definitions shall apply:

                  (a) "Administrator" shall mean the entity, either the Board or
the committee of the Board, responsible for administering this Plan, as provided
in Section 3.

                  (b)  "Affiliate"  means a parent or subsidiary  corporation as
defined in Sections 424(e) and (f) of the Code.

                  (c)  "Annual  Option"  shall  have the  meaning  set  forth in
Section 6(b).

                  (d) "Board"  shall mean the Board of Directors of the Company,
as constituted from time to time.

                  (e) "Change in Control"  shall mean the  occurrence of any one
of the following:

                           (i) any  "person,"  as such term is used in  Sections
13(d) and 14(d) of the Exchange Act (other than the Company, an Affiliate,  or a
Company  employee  benefit  plan,  including  any trustee of such plan acting as
trustee)  is or becomes the  "beneficial  owner" (as defined in Rule 13d-3 under
the  Exchange  Act),  directly  or  indirectly,  of  securities  of the  Company
representing  50% or more of the  combined  voting power of the  Company's  then
outstanding securities;

                           (ii) the  election of any director of the Company who
was not a candidate  proposed by a majority of the Board in office  prior to the
time of such election; or

                           (iii) the  dissolution  or  liquidation  (partial  or
total) of the Company or a sale of assets involving 50% or more of the assets of
the Company,  or any merger or  reorganization  of the  Company,  whether or not
another  entity is the  survivor,  or other  transaction  pursuant  to which the
holders,  as a group, of all of the shares of the Company  outstanding  prior to
the  transaction  hold,  as a group,  less than 50% of the shares of the Company
outstanding after the transaction.

                  (f) "Code"  shall mean the Internal  Revenue Code of 1986,  as
amended from time to time, and any successor statute.

                  (g) "Company"  shall mean CommTouch  Software Ltd., an Israeli
corporation.

                  (h)  "Disability"  means  permanent  and total  disability  as
determined by the  Administrator  in accordance  with the standards set forth in
Section 22(e)(3) of the Code.
<PAGE>

                  (i) "Exchange Act" means the Securities  Exchange Act of 1934,
as amended from time to time, and any successor statute.

                  (j)  "Expiration  Date" shall mean the last day of the term of
an Option established under Section 6(e).

                  (k) "Fair  Market  Value"  means as of any given  date (a) the
closing price of the Ordinary Shares as reported by the Nasdaq National  Market;
(b) if the Ordinary  Shares are no longer quoted on the Nasdaq  National  Market
but  are  listed  on an  established  stock  exchange  or  quoted  on any  other
established  interdealer  quotation  system,  the closing price for the Ordinary
Shares on such exchange or system,  as reported in the Wall Street  Journal;  or
(c) if the Ordinary Shares are not traded on an exchange or quoted on the Nasdaq
National  Market or a successor  quotation  system,  the fair market value of an
Ordinary  Share as  determined  by the Board in good faith.  Such  determination
shall be conclusive and binding on all persons.

                  (l)  "Initial  Option"  shall  have the  meaning  set forth in
Section 6(a).

                  (m)  "Nonemployee  Director"  shall  mean any  person who is a
member of the Board but is not an employee of the  Company or any  Affiliate  of
the Company and has not been an employee of the Company or any  Affiliate of the
Company at any time during the  preceding 12 months.  Service as a director does
not in itself constitute employment for purposes of this definition.

                  (n)  "Option"  shall mean a stock option  granted  pursuant to
this Plan. Each Option shall be a nonstatutory option not intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code.

                  (o)  "Option  Agreement"  shall  mean  the  written  agreement
described  in  Section 6  evidencing  the  grant of an  Option to a  Nonemployee
Director and containing the terms,  conditions  and  restrictions  pertaining to
such Option.

                  (p) "Optionee" shall mean a Nonemployee  Director who holds an
Option.

                  (q) "Ordinary  Shares"  shall mean the Ordinary  Shares of the
Company.

                  (r) "Plan"  shall mean this  Amended  and  Restated  Commtouch
Software Ltd. 1999 Nonemployee Directors Stock Option Plan, as it may be amended
from time to time.

                  (s) "Section" unless the context clearly indicates  otherwise,
shall refer to a Section of this Plan.

                  (t)  "Shares"  shall mean the  Ordinary  Shares  subject to an
Option granted under this Plan.

                  (u) "Tax Date" means the date defined in Section 7(c).

                  (v)  "Termination"  means,  for  purposes  of the  Plan,  with
respect to an Optionee,  that the  Optionee has ceased to be, for any reason,  a
director of the Company.

         3.       ADMINISTRATION.

                  (a) Administrator. The Plan shall be administered by the Board
or, upon  delegation by the Board,  by a committee  consisting of not fewer than
two non-employee  directors (as such term is defined in Rule  16b-3(b)(3)(i)  of
the Exchange Act) (in either case, the "Administrator"). The Administrator shall
have no authority,  discretion or power to select the Nonemployee  Directors who
will receive  Options  hereunder or to set the number of shares to be covered by
each Option granted hereunder,  the exercise price of such Option, the timing of
the grant of such Option or the period within which such
<PAGE>

Option may be exercised;  provided,  however,  that the Administrator shall have
the  discretion to change the exercise  price of an  outstanding  option granted
under the Plan or to issue  new  options  under  the Plan with a lower  exercise
price in exchange for  outstanding  options granted under the Plan in connection
with a general  repricing by the Company of outstanding  options.  In connection
with the  administration  of the Plan, the  Administrator  shall have the powers
possessed  by the Board.  The  Administrator  may act only by a majority  of its
members. The Administrator may delegate  administrative duties to such employees
of the Company as it deems proper,  so long as such  delegation is not otherwise
prohibited  by Rule  16b-3  under the  Exchange  Act.  The Board at any time may
terminate the authority delegated to any committee of the Board pursuant to this
Section 3(a) and revest in the Board the administration of the Plan.

                  (b)  Administrator  Determinations  Binding.  Subject  to  the
limitations set forth in Section 3(a), the  Administrator  may adopt,  alter and
repeal administrative  rules,  guidelines and practices governing the Plan as it
from time to time shall deem  advisable,  may interpret the terms and provisions
of the Plan, any Option and any Option Agreement and may otherwise supervise the
administration  of the Plan. All decisions made by the  Administrator  under the
Plan shall be binding on all persons,  including the Company and  Optionees.  No
member of the Administrator shall be liable for any action that he or she has in
good faith taken or failed to take with respect to this Plan or any Option.

         4.       ELIGIBILITY.

                  Only  Nonemployee  Directors  may receive  Options  under this
Plan.

         5.       SHARES SUBJECT TO PLAN.


                  (a) Aggregate  Number.  Subject to Section 9, the total number
of Ordinary Shares reserved and available for issuance pursuant to Options under
this Plan shall be 1,450,000 shares, an increase of 100,000 shares.  Such shares
may consist,  in whole or in part, of authorized  and unissued  shares or shares
reacquired  in private  transactions  or open market  purchases,  but all shares
issued  under  the Plan  regardless  of  source  shall be  counted  against  the
1,450,000 share  limitation.  If any Option  terminates or expires without being
exercised  in full,  the  shares  issuable  under  such  Option  shall  again be
available  for issuance in connection  with other  Options.  If Ordinary  Shares
issued  pursuant to an Option are  repurchased  by the  Company,  such  Ordinary
Shares shall not again be available for issuance in connection with Options.  To
the extent the number of Ordinary Shares issued pursuant to an Option is reduced
to satisfy withholding tax obligations, the number of shares withheld to satisfy
the withholding tax obligations shall not be available for later grant under the
Plan.

                  (b) No Rights as a  Shareholder.  An  Optionee  shall  have no
rights as a shareholder  with respect to any Shares covered by his or her Option
until an electronic transfer (as evidenced by the appropriate entry on the books
of the  Company  or its  duly  authorized  transfer  agent)  of such  Shares  is
effected.  Subject  to  Section  9, no  adjustment  shall be made for  dividends
(ordinary or  extraordinary,  whether in cash,  securities  or other  property),
distributions,  or other  rights for which the record  date is prior to the date
the certificate is issued.

         6.       GRANT OF OPTIONS.

                  (a) Mandatory Initial Option Grants.  Subject to the terms and
conditions  of this  Plan,  if any  person  who is not  presently  an officer or
employee of the Company is elected or  appointed a member of the Board,  then on
the effective  date of such  appointment  or election the Company shall grant to
such new Nonemployee Director an Option to purchase 30,000 shares at an exercise
price equal to the Fair  Market  Value of such Shares on the date of such option
grant.  Any Option granted pursuant to this Section 6(a) shall be referred to as
an "Initial  Option." All Nonemployee  Directors  elected at the August 10, 2000
annual  meeting of  shareholders,  as well as  Nonemployee  Directors  appointed
directly  by the  Board,  will  receive  an  "Initial  Option"  grant upon their
election or appointment.
<PAGE>
                  (b) Mandatory  Annual Option Grants.  Subject to the terms and
conditions  of  this  Plan,  on the  date  of the  first  meeting  of the  Board
immediately following the annual meeting of shareholders of the Company (even if
held on the same day as the meeting of  shareholders)  commencing  in 2002,  the
Company  shall grant to each  Nonemployee  Director then in office (other than a
Nonemployee  Director  who  received a grant under  Section 6(a) on or after the
record date for such annual  meeting) an Option to purchase up to 10,000  shares
at an exercise  price equal to the Fair Market  Value of such shares on the date
of such option grant;  provided,  however, that (i) each Nonemployee Director in
office  immediately  after the annual general  meeting of shareholders in August
2001  shall be  granted a  one-time  Option  grant of 33,750  shares,  (ii) each
Nonemployee  Director  in office  immediately  after the  extraordinary  general
meeting of  shareholders  in  February  2002 shall be granted a one-time  Option
grant  of  150,000  shares,  and  (iii)  each  Nonemployee  Director  in  office
immediately  after the annual general  meeting of  shareholders in November 2002
shall be granted a one-time  Option grant of 50,000  shares.  Any Option granted
pursuant to this Section 6(b) shall be referred to as an "Annual Option."

                  (c) Vesting of Initial Option and Annual  Option.  Each Option
granted under Section 6(a) or 6(b) shall become  exercisable at a rate of 1/16th
of the shares every three months.

                  (d) Term.  Subject to the other  provisions of this Plan, each
Option granted pursuant to this Plan shall have a term of ten years.

                  (e) Limitation on Other Grants.  The Administrator  shall have
no  discretion  to grant  Options  under  this Plan  other  than as set forth in
Sections 6(a) and 6(b).

                  (f) Option  Agreement.  As soon as practicable after the grant
of an Option,  the  Optionee and the Company  shall enter into a written  Option
Agreement  which specifies the date of grant,  the number of Shares,  the option
price, and the other terms and conditions applicable to the Option.

                  (g)  Transferability.  No Option shall be transferable  except
that  (I) an  Option  may be  distributed  by will or the  laws of  descent  and
distribution;  or (ii)  Optionee  may  transfer  or  assign an Option to (a) any
family  member  or trust  for the  benefit  of  Optionee  or a family  member of
Optionee,  or (b) any entity  which is an  investor  in the Company and of which
Optionee is a general or limited partner or a member of senior  management.  The
terms of this Plan shall be binding upon the executors,  administrators,  heirs,
successors, assigns and transferees of the Optionee.

                  (h) Limits on  Exercise.  Subject to the other  provisions  of
this Plan,  an Option shall be  exercisable  in such amounts as are specified in
the Option Agreement.

                  (i) Exercise  Procedures.  To the extent the right to purchase
Shares has accrued,  Options may be exercised, in whole or in part, from time to
time, by written  notice from the Optionee to the Company  stating the number of
Shares being  purchased,  accompanied  by payment of the exercise  price for the
Shares, and other applicable amounts, as provided in Section 7.

                  (j) Termination. In the event of Termination,  Options held at
the date of  Termination,  to the extent then  exercisable,  may be exercised in
whole or in part at any time within three months after the date of  Termination,
(but in no event after the Expiration Date), but not thereafter. Notwithstanding
the foregoing, if Termination is due to death or Disability, Options held at the
date of Termination,  to the extent then exercisable,  may be exercised in whole
or in part at any time within two years from the date of Termination  (but in no
event after the Expiration  Date) by the Optionee or by the Optionee's  guardian
or legal  representative  in the case of Disability or in the case of death,  by
the person to whom the Option is  transferred by will or the laws of descent and
distribution.
<PAGE>

         7.       PAYMENT AND TAXES UPON EXERCISE OF OPTIONS.

                  (a) Purchase Price.  The purchase price of Shares issued under
this Plan shall be paid in full at the time an Option is exercised.

                  (b) Delivery of Purchase Price.  Optionees may make all or any
portion of any  payment due to the  Company  upon  exercise of an Option or with
respect to federal,  state,  local or foreign tax payable in connection with the
exercise of an Option,  by delivery of cash or check.  Exercise of an Option may
be made pursuant to a "cashless exercise/sale" procedure pursuant to which funds
to pay for exercise of the Option are  delivered to the Company by a broker upon
receipt of stock from the Company,  or pursuant to which Optionees obtain margin
loans from brokers to fund the exercise of the Option.

                  (c) Tax Withholding.  The Optionee shall pay to the Company in
cash, promptly upon exercise of an Option or, if later, the date that the amount
of such obligations  becomes  determinable (in either case, the "Tax Date"), all
applicable  federal,  state,  local  and  foreign  withholding  taxes  that  the
Administrator,  in its  discretion,  determines  will result upon exercise of an
Option or from a transfer or other  disposition of the Ordinary  Shares acquired
upon  exercise of an Option or  otherwise  related to an Option or the  Ordinary
Shares acquired in connection with an Option.

                  A person who has  exercised  an Option may make an election to
have the Ordinary  Shares to be obtained upon exercise of the Option withheld by
the  Company  on  behalf  of the  Optionee,  to pay the  amount  of tax that the
Administrator,  in its  discretion,  determines to be required to be withheld by
the Company.

         Any  Ordinary  Shares  tendered to or  withheld by the Company  will be
valued at Fair  Market  Value on such  date.  The value of the  Ordinary  Shares
tendered or  withheld  may not exceed the  required  federal,  state,  local and
foreign withholding tax obligations as computed by the Company.

         8.       USE OF PROCEEDS.

                  Proceeds  from the  exercise of Options  pursuant to this Plan
shall be used for general corporate purposes.

         9.       ADJUSTMENT OF SHARES.

                  In the  event of any  merger,  reorganization,  consolidation,
recapitalization,  stock  dividend,  stock  split or other  change in  corporate
structure affecting the Ordinary Shares,  appropriate  adjustments shall be made
by the  Administrator  in the  aggregate  number  and  kind of  shares  of stock
reserved for issuance under the Plan and in the number,  kind and exercise price
of shares subject to outstanding Options; provided,  however, that the number of
shares subject to any Option shall always be a whole number.

         10.      EFFECT OF CHANGE IN CONTROL.

                  In the event of a "Change in Control," any Options outstanding
as of the date such Change in Control is  determined  to have  occurred  and not
then exercisable and vested shall become fully exercisable and vested.

         11.      NO RIGHT TO DIRECTORSHIP.

                  Neither  this  Plan nor any  Option  granted  hereunder  shall
confer  upon  any  Optionee  any  right  with  respect  to  continuation  of the
Optionee's membership on the Board or shall interfere in any way with provisions
in the Company's  Memorandum of Association and Articles of Association relating
to the  election,  appointment,  terms of office,  and removal of members of the
Board.
<PAGE>

         12.      LEGAL REQUIREMENTS.

                  The Company shall not be obligated to offer or sell any Shares
upon  exercise  of any Option  unless  the  Shares are at that time  effectively
registered or exempt from registration under the federal securities laws and the
offer and sale of the Shares are  otherwise in  compliance  with all  applicable
securities laws and the regulations of any stock exchange on which the Company's
securities may then be listed.  The Company shall have no obligation to register
the securities  covered by this Plan under the federal  securities  laws or take
any other steps as may be  necessary  to enable the  securities  covered by this
Plan to be  offered  and sold  under  federal  or other  securities  laws.  Upon
exercising  all or any  portion of an Option,  an  Optionee  may be  required to
furnish  representations  or undertakings  deemed  appropriate by the Company to
enable the offer and sale of the Shares or subsequent  transfers of any interest
in the Shares to comply with applicable securities laws. Certificates or records
of  electronic  transfers  evidencing  Shares  acquired upon exercise of Options
shall bear any legend  required by, or useful for purposes of  compliance  with,
applicable securities laws, this Plan or the Option Agreements.

         13.      DURATION AND AMENDMENTS.

                  (a)  Duration.  This  Plan  shall  become  effective  upon the
closing of the  Company's  initial  public  offering,  provided that it has been
adopted by the Board and approved by the shareholders of the Company,  either by
written  consent  or by  approval  of  shareholders  voting at a validly  called
shareholders'  meeting.  The Plan  shall  terminate  automatically  on the tenth
anniversary of its effective date.

                  (b) Amendment and Termination.  The Board may amend,  alter or
discontinue   the  Plan  or  any  Option,   but  no  amendment,   alteration  or
discontinuance  shall be made which would impair the rights of an Optionee under
an outstanding Option without the Optionee's consent. No amendment shall require
shareholder  approval  except  (i) an  increase  in the  total  number of shares
reserved for issuance under the Plan,  (ii) to the extent required by applicable
laws,  rules or  regulations  or (iii) to the  extent  that the Board  otherwise
concludes that shareholder approval is advisable.

                  (c) Effect of  Amendment  or  Termination.  No Shares shall be
issued  or sold  under  this Plan  after the  termination  hereof,  except  upon
exercise of an Option  granted before  termination.  Termination or amendment of
this Plan shall not affect any Shares  previously  issued and sold or any Option
previously granted under this Plan.

         14.      Rule 16b-3.

                  With respect to persons  subject to Section 16 of the Exchange
Act,  transactions  under this Plan are  intended to comply with the  applicable
conditions  of Rule 16b-3 under the Exchange Act. To the extent any provision of
this  Plan or  action  by the  Administrator  fails  to so  comply,  it shall be
adjusted to comply with Rule 16b-3,  to the extent  permitted  by law and deemed
advisable  by the  Administrator.  It shall  be the  responsibility  of  persons
subject  to  Section  16 of  the  Exchange  Act,  not  of  the  Company  or  the
Administrator,  to comply with the  requirements  of Section 16 of the  Exchange
Act; and neither the Company nor the Administrator  shall be liable if this Plan
or any  transaction  under  this  Plan  fails  to  comply  with  the  applicable
conditions  of Rule 16b-3,  or if any such  person  incurs any  liability  under
Section 16 of the Exchange Act.




Approved by the Board of Directors on April 18, 1999.

Approved by the  Shareholders of the Company on June 8, 1999, to be effective on
the date of the closing of the Company's initial public offering of its ordinary
shares.

Last Amended by the Board of Directors on October 1, 2002.