8-K












Exhibit 10.1  









PLURISTEM LIFE
SYSTEMS,  THERAPEUTICS  INC. 
AMENDEDAND RESTATED
2005 STOCK OPTION PLAN * 





This
aAmended and Restated 2005 Stock
Option Plan (the “Plan”) provides for the grant of Restricted Stock,
Restricted Stock Units and options to acquire common shares (the
“of Common
Shares”)Stock in the capital of Pluristem Life
Systems,Therapeutics Inc., a corporation formed under the
laws of the State of Nevada (the “Corporation”). Stock
optionsAwards granted under this Plan will include: 






	 	(a) 	stock
options, that qualify under Section 422 of the Internal Revenue
                    Code of 1986, as amended (the “Code”), which will be
referred to in                     this Plan as “Incentive Stock Options”; 






	 	(b) 	stock
options, Restricted Stock and Restricted Stock Units,                    that
qualify under Section 102 of the Israeli Tax Ordinance (New Version) 1961,
                    as amended and the rules and regulations promulgated thereunder (the
                    “Ordinance”), which will be referred to in this Plan as
                    “Section  102 OptionsAwards”; 






	 	(c) 	stock
options, Restricted Stock and Restricted Stock Units, that
do not qualify under Section 422 of the Code , which will be referred to in
this Plan as “Non-Qualified Stock Options Awards”;
and  






	 	(d) 	Section
3(i) Options, beingstock                    options,
Restricted Stock and Restricted Stock Units under
                    Section 3(i) of the Ordinance to consultants and Controlling
Shareholders that                     are excluded from the term “Israeli Employee” as
defined in Section                     3.1 herein, which will be referred to in this
Plan                     as “3(i) Awards”. 






Incentive Stock Options, Section
102 OptionsAwards, Non-Qualified Stock
OptionsAwards and Section 3(i)
 OptionsAwards, granted under this Plan are collectively referred to
as “OptionsAwards”. 



	
1.  	PURPOSE  






1.1     The
purpose of this Plan is to retain the services of valued key employees and consultants of
the Corporation and such other persons as the Plan Administrator (as hereinafter defined)
shall select in accordance with Section 3 below, and to encourage such persons to acquire
a greater proprietary interest in the Corporation, thereby strengthening their incentive
to achieve the objectives of the shareholders of the Corporation, and to serve as an aid
and inducement in the hiring of new employees and to provide an equity incentive to
consultants and other persons selected by the Plan Administrator.  



1.2     This
Plan shall at all times be subject to all legal requirements relating to the
administration of stock option plansAwards, if
any, under applicable corporate laws, applicable United States federal and state
securities laws, the Code, applicable Israeli tax laws, Israeli securities laws, Israeli
corporate laws, Israeli foreign exchange control laws the rules of any applicable stock
exchange or stock quotation system, and the rules of any other foreign jurisdiction
applicable to OptionsAwards granted to residents
therein (collectively, the “Applicable Laws”).  





* This version reflects the changes
to the Company’s 2005 Stock Option Plan in the form filed with the Securities and
Exchange Commission on May 24, 2007 as exhibit 99.1 to the Company’s current report
on Form 8-K. 















	
2.  	ADMINISTRATION  






2.1     This
Plan shall be administered initially by the board of directors of the Corporation (the
“Board”), except that the Board may, in its discretion, establish a committee
composed of two (2) or more members of the Board or two (2) or more other persons to
administer the Plan, which committee (the “Committee”) may be an executive,
compensation or other committee, including a separate committee especially created for
this purpose. The Board or, if applicable, the Committee is referred to herein as the
“Plan Administrator”. 




2.2     If and
so long as the shares of Common Shares isStock
are registered under Section 12(b) or 12(g) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”) and the Corporation wishes to grant
Incentive Stock Options, then the Board shall consider in selecting the Plan
Administrator and the membership of any Committee, with respect to any persons subject or
likely to become subject to Section 16 of the Exchange Act, the provisions regarding (a)
“outside directors” as contemplated by Section 162(m) of the Code, and (b)
“Non-Employee Directors” as contemplated by Rule 16b-3 under the Exchange Act.  




2.3     The
Committee shall have the powers and authority vested in the Board hereunder (including
the power and authority to interpret any provision of the Plan or of any Option). The
members of any such Committee shall serve at the pleasure of the Board. A majority of the
members of the Committee shall constitute a quorum, and all actions of the Committee
shall be taken by a majority of the members present. Any action may be taken by a written
instrument signed by all of the members of the Committee and any action so taken shall be
fully effective as if it had been taken at a meeting.  



2.4     Subject
to the provisions of this Plan and any Applicable Laws, and with a view to accomplishing
the purpose of the Plan, the Plan Administrator shall have sole authority, in its
absolute discretion, to:  





	 	(a) 	construe
and interpret the terms of the Plan and any OptionAward granted
pursuant to this Plan; 






	 	(b) 	define
the terms used in the Plan; 






	 	(c) 	prescribe,
amend and rescind the rules and regulations relating to this Plan; 






	 	(d) 	correct
any defect, supply any omission or reconcile any inconsistency in this
                    Plan; 






	 	(e) 	grant
OptionsAwards under this Plan, except
                    grants to directors, the CEO, the CFO and the CTO of the Corporation,
which will                     be granted by the Board as a whole if required by
Applicable                     Law; 







2








	 	(f) 	determine
the individuals to whom OptionsAwards shall be
granted under this                     Plan and whether the     Option    Award is
granted as an Incentive                     Stock Option, Section 102 OptionAward,
                    a Non-Qualified Stock OptionAwards, or
                    Section 3(i) OptionAward; 






	 	(g) 	make
an election under Section 102(b)(1) or (2) of the Ordinance; 






	 	(h) 	determine
the time or times at which OptionsAwards shall be
granted under this                     Plan; 






	 	(i) 	determine
the number of shares of Common SharesStock subject
to each OptionAward, the exercise price of each
OptionAward, the duration of each OptionAward and
the times at which each OptionAward  shall become
vested and exercisable; 






	 	(j) 	determine
all other terms and conditions of the OptionsAwards;
and 






	 	(k) 	make
all other determinations and interpretations necessary and advisable for
                    the administration of the Plan. 






2.5     All
decisions, determinations and interpretations made by the Plan Administrator shall be
binding and conclusive on all participants in the Plan and on their legal
representatives, heirs and beneficiaries.  



	
3.  	ELIGIBILITY  






	3.1  	Definitions.
In this agreement:






“Affiliate” means
any “employing company” within the meaning of Section 102(a) of the Ordinance.  



“Controlling
Shareholder” shall have the meaning ascribed to it in Section 32(9) of the
Ordinance.” 



“Israeli Employee”
means a person who is employed by the Corporation or its Affiliates in Israel,
including an individual who is serving as a director or an office holder, but excluding a
Controlling Shareholder. 



“Related
Corporation” means any corporation (other than the Corporation) that is a
“Parent Corporation” of the Corporation or “Subsidiary Corporation” of
the Corporation, as those terms are defined in Sections 424(e) and 424(f), respectively,
of the Code (or any successor provisions) and the regulations thereunder (as amended from
time to time). 



3.2     Incentive
Stock Options may be granted to any individual who, at the time such Option is granted,
is an employee of the Corporation or any Related Corporation (as hereinafter defined) (an
“Employee”).  




3









3.3     Non-Qualified
Stock OptionsAwards, may be granted to Employees,
and to such other persons who are not Employees as the Plan Administrator shall select,
subject to any Applicable Laws.  



3.4     Section
102 Options   Awards   may be granted to Israeli Employees in accordance with Section 4 herein.  



3.5     Section
 3(i) Options   Awards   may be granted  to  consultants  and  Controlling  Shareholders
 that do not qualify as Israeli Employees. 






3.6    OptionsAwards may
be granted in substitution for outstanding OptionsAwards of
another corporation in connection with the merger, consolidation, acquisition of property
or stock or other reorganization between such other corporation and the Corporation or
any subsidiary of the Corporation. OptionsAwards also
may be granted in exchange for outstanding OptionsAwards.  



3.7     Any
person to whom an Optionoption is granted under
this Plan is referred to as an “Optioneea “Participant”.
Any person who is the owner of an OptionAward is
referred to as a “Holder”.  





	4.  	DESIGNATION
OF OPTIONSAWARDS PURSUANT TO SECTION 102 (RELEVANT ONLY TO ISRAELI EMPLOYEES)  






4.1     The
Corporation may designate Section 102 OptionsAwards granted
to Israeli Employees pursuant to Section 102 of the Ordinance as Unapproved 102 OptionsAwards (means
an Option granted pursuant to Section 102(c) of the Ordinance and not held in trust by a
Trustee) or Approved 102 OptionsAwards (means an
OptionAward granted pursuant to Section 102(b) of
the Ordinance and held in trust by a Trustee for the benefit of the  OptioneeParticipant).  



4.2     The
grant of Approved 102 OptionsAwards shall be made
under this Plan adopted by the Board, and shall be conditioned upon the approval of this
Plan by the Israeli Tax Authorities (the “ITA”).  



4.3     Approved
102 OptionAward may either be classified as
Capital Gain Option “CGOAward (“CGA”)
or Ordinary Income OptionAward(“OIOOIA”).  



4.4     Approved
102 OptionAward elected and designated by the
Corporation to qualify under the capital gain tax treatment in accordance with the
provisions of Section 102(b)(2) shall be referred to herein as CGOCGA.  



4.5     Approved
102 OptionAward elected and designated by the
Corporation to qualify under the ordinary income tax treatment in accordance with the
provisions of Section 102(b)(1) shall be referred to herein as OIOOIA.  



4.6     The
Corporation’s election of the type of Approved 102 OptionsAwards as
CGOCGA or OIOOIAgranted
to Employees (the “Election”), shall be appropriately filed with the ITA
before the Date of Grant of an Approved 102 OptionAward.
Such Election shall become effective beginning the first Date of Grant of an Approved 102
OptionAward under this Plan and shall remain in effect at least until the end of the year
following the year during which the Corporation first granted Approved 102 OptionsAwards.
The Election shall obligate the Corporation to grant only the type of Approved 102
OptionAward it has elected, and shall apply to
all OptioneesParticipants who were granted Approved 102 OptionsAwards during
the period indicated herein, all in accordance with the provisions of Section 102(g) of
the Ordinance. For the avoidance of doubt, such Election shall not prevent the
Corporation from granting Unapproved 102 OptionsAwards simultaneously.  




4








4.7     All
Approved 102 OptionsAwards must be held in trust
by a Trustee (means any entity appointed by the Corporation to serve as a trustee and
approved by the ITA, all in accordance with the provisions of Section 102(a) of the
Ordinance, as described in Section 5 below (the “Trustee”)).  



4.8     For the
avoidance of doubt, the designation of Unapproved 102 OptionsAwards and
Approved 102  OptionsAwards shall be subject to the terms and
conditions set forth in Section 102 of the Ordinance and the regulations promulgated
thereunder.  



4.9     With
regards to Approved 102 OptionsAwards, the
provisions of the Plan and/or the OptionAward Agreement
shall be subject to the provisions of Section 102 and the Tax Assessing Officer’s
permit, and the said provisions and permit shall be deemed an integral part of the Plan
and of the OptionAward Agreement. Any provision
of Section 102 and/or the said permit which is necessary in order to receive and/or to
keep any tax benefit pursuant to Section 102, which is not expressly specified in the
Plan or the OptionAward Agreement, shall be
considered binding upon the Corporation and the  Optionees Participants.  



	
5.  	TRUSTEE  






5.1     Approved
102 OptionsAwards which shall be granted under
the Plan and/or any Sharesshares allocated or
issued upon exercise of such Approved 102 OptionsAwards and/or
other shares received subsequently following any realization of rights, including,
without limitation, bonus shares, shall be allocated or issued to the Trustee and held
for the benefit of the OptioneesParticipants for
such period of time as required by Section 102 or any regulations, rules or orders or
procedures promulgated thereunder (the “Holding Period”). In the
case the requirements for Approved 102 OptionsAwards are
not met, then the Approved 102 OptionsAwards may
be treated as Unapproved 102 OptionsAwards, all
in accordance with the provisions of Section 102 and regulations promulgated thereunder.  



5.2     Notwithstanding
anything to the contrary, the Trustee shall not release any Sharesshares allocated
or issued upon exercise of Approved 102 OptionsAwards prior
to the full payment of the OptioneeParticipant’s
tax liabilities arising from Approved 102 OptionsAwards which
were granted to him and/or any Sharesshares allocated
or issued upon exercise or vesting of such OptionsAwards
as the case my be.  



5.3     Upon
receipt of Approved 102 OptionAwards, the
Optionee will sign an undertaking to release the Trustee from any liability in respect of
any action or decision duly taken and bona fide executed in relation with the Plan, or
any Approved 102 OptionAwards or Share granted to
him thereunder.  




5








5.4     With
respect to any Approved 102 OptionAwards, subject
to the provisions of Section 102 and any rules or regulation or orders or procedures
promulgated thereunder, an Optioneea Participant shall
not sell or release from trust any ShareAward and any
share received upon the exercise or vesting of an Approved
102 OptionAward and/or any share received
subsequently following any realization of rights, including without limitation, bonus
shares, until the lapse of the Holding Period required under Section 102 of the
Ordinance. Notwithstanding the above, if any such sale or release occurs during the
Holding Period, the sanctions under Section 102 of the Ordinance and under any rules or
regulation or orders or procedures promulgated thereunder shall apply to and shall be
borne by such OptioneeParticipant. 



5.5     With
respect to all SharesAwards, (but excluding, for
avoidance of any doubt, any unexercised   Optionsoptions and any unvested Restricted
Stock Units) allocated or issued upon the exercise of Options purchased by
the OptioneeParticipant, or issued to the Participant
pursuant to the Vesting of Restricted Stock Units, and held by the OptioneeParticipant or
by the Trustee, as the case may be, the OptioneeParticipant shall
be entitled to receive dividends in accordance with the quantity of such Sharesshares,
subject to the provisions of the Corporation’s incorporation documents (and all
amendments thereto) and subject to any applicable taxation on distribution of dividends,
and when applicable subject to the provisions of Section 102.  



	
6.  	STOCK  






6.1     The Plan
Administrator is authorized to grant Options to acquire up to a total of 280,000,000
Common Shares. The number of Common Shares with respect to which OptionsAwards
to acquire shares of Common Stock, shares of Restricted Stock and Restricted Stock Units
in a number not exceeding 16% of the number of shares of Common Stock of the Corporation
issued and outstanding immediately prior to the grant of such Awards on a Fully Diluted
Basis. For purposes of this Section 6.1, the term “Fully Diluted Basis” means
all issued and outstanding share capital (where options shall be deemed outstanding share
capital until exercised) and all rights to acquire share capital including, without
limitation, all securities convertible or exercisable into shares of Common Stock being
deemed so converted and exercised, the conversion of any convertible stockholder loans
into share capital, with all outstanding warrants, options or any other right granted by
the Corporation to receive shares of the Corporation’s share capital being deemed
exercised in full. The foregoing notwithstanding, the maximum number of shares that may
be subject to Incentive Stock Options granted under the Plan shall be 450,000, subject to
adjustment as provided in Section 7.1(m). Shares of Common Stock with respect to which
Awards may be granted hereunder isare subject
to adjustment as set forth in Section 7.1(m) hereof. In the event that any outstanding OptionAward expires
or is terminated for any reason, the shares Common Shares allocable
to the unexercised portion of such OptionAward may
again be subject to an OptionAward granted to the
same OptioneeParticipant or Holder or to a
different person eligible under Section 3 of this Plan; provided however, that any
cancelled Options will be counted against the maximum number of Common Shares with
respect to which Options may be granted to any particular person as set forth in Section
3 hereof.  




6








6.2     The
maximum number of shares of Common Stock for which Options may be granted to any person
in any calendar year shall be 1,000,000.  



	
7.  	TERMS
AND CONDITIONS OF OPTIONSAWARDS  






7.1     Each OptionAward granted
under this Plan shall be evidenced by a written agreement approved by the Plan
Administrator (each, an “Agreement”). Agreements may contain such provisions,
not inconsistent with this Plan or any Applicable Laws, as the Plan Administrator in its
discretion may deem advisable. All OptionsAwards also
shall comply with the following requirements:  



	 	(a)  	Number
of Sharesshares of Common Stock underlying the
          Award and Type of OptionAward. 






	 	
Each
Agreement shall state the number of shares of Common SharesStock to
which it pertains and whether the OptionAward is
intended to be an Incentive Stock Option, Section 102 OptionAwards (CGOCGA or OIOOIA)
or a Non-Qualified Stock OptionAwards; provided
that:  






	 	(i) 	the
number of Common Shares that may be reserved pursuant to the exercise of OptionsAwards granted
to any person shall not           exceed 5% of the issued and outstanding Common Shares
of the Corporation;  






	 	(ii) 	in
the absence of action to the contrary by the Plan Administrator in connection
          with the grant of an OptionAward, all
OptionsAwards shall be Non-Qualified Stock
          OptionsAwards, Unapproved 102 OptionsAwards or
Section 3(i) OptionsAwards, as the case maybe;  






	 	(iii) 	the
aggregate fair market value (determined at the Date of Grant, as defined           below)
of the shares of  Common SharesStock with
respect to which Incentive           Stock Options are exercisable for the first time by
the Optionee during any           calendar year (granted under this Plan and all other
Incentive Stock Option           plans of the Corporation, a Related Corporation or a
predecessor corporation)           shall not exceed U.S.$100,000, or such other limit as
may be prescribed by the           Code as it may be amended from time to time (the “Annual
Limit”); and  






	 	(iv) 	any
portion of an OptionAward which exceeds
          the Annual Limit shall not be void but rather shall be a Non-Qualified Stock
          OptionAward.  






7








	 	(b) 	Date
of Grant 






	 	
Each
Agreement shall state the date the Plan Administrator has deemed to be the effective date
of grant of the OptionAward for
purposes of this Plan (the “Date of Grant”). Option Price 






	 	(c) 	Exercise
Price 






	 	
Each
Agreement shall state the price per shares of Common Share atStock
to which itan Award is exercisable (if
applicable). The Plan Administrator shall act in good faith to establish
the exercise price in accordance with Applicable Laws; provided that:  






	 	(i) 	the
per share exercise price for an Incentive Stock Option or any Option granted           to
a “covered employee” as such term is defined for purposes of           Section
162(m) of the Code shall not be less than the fair market value per           Common
Share at the Date of Grant as determined by the Plan Administrator in           good
faith;  






	 	(ii) 	with
respect to Incentive Stock Options granted to greater-than-ten percent           (>10%)
shareholders of the Corporation (as determined with reference to           Section 424(d)
of the Code), the exercise price per share shall not be less than           one hundred
ten percent (110%) of the fair market value per Common ShareStock at
the Date of Grant as determined           by the Plan Administrator in good faith; and  






	 	(iii) 	Options
granted in substitution for outstanding options of another corporation           in
connection with the merger, consolidation, acquisition of property or stock           or
other reorganization involving such other corporation and the Corporation or
          any subsidiary of the Corporation may be granted with an exercise price equal
to           the exercise price for the substituted option of the other corporation,
subject           to any adjustment consistent with the terms of the transaction pursuant
to which           the substitution is to occur.  






	 	(iv) 	solely
for the purpose of determining the tax liability pursuant to Section           102(b)(3)
of the Ordinance, if at the date of grant the Corporation’s           shares are
listed on any established stock exchange or a national market system           or if the
Corporation’s shares will be registered for trading within ninety           (90)
days following the date of grant of the CGOsCGAs,
the fair market value of the Shares           at the date of grant shall be determined in
accordance with the average value of           the Corporation’s shares on the
thirty (30) trading days preceding the date           of grant or on the thirty (30)
trading days following the date of registration           for trading, as the case may
be.  






	 	(d) 	Duration
of OptionsAwards






	 	
At
the time of the grant of the OptionAward, the
Plan Administrator shall designate, subject to Section 7.1(g) below, the expiration date
of the OptionAwards, which date shall not be
later than 10 years from the Date of Grant; provided, that the Plan Administrator
decided otherwise in specific option agreementsAward
Agreements or, that the expiration date of any Incentive Stock Option granted to a
greater-than-ten percent (>10%) shareholder of the Corporation (as determined with
reference to Section 424(d) of the Code) shall not be later than five (5) years from the
Date of Grant. In the absence of action to the contrary by the Plan Administrator in
connection with the grant of a particular OptionAward,
and except in the case of Incentive Stock Options as described above, all OptionsAwards granted
under this Section 7 shall expire 10 years from the Date of Grant.  







8








	 	(e) 	Vesting
Schedule 






	 	
No
OptionAward shall be exercisable until it has
vested. The vesting schedule for each OptionAward shall be specified
by the Plan Administrator at the time of grant of the OptionAward
 prior to the provision of services with respect to which such OptionAward is
granted.; provided  that if no vesting schedule is specified at the
time of grant, the OptionAward shall vest as
follows:  






	 	(i) 	on
the six month anniversary of the Date of Grant, the OptionAward shall
vest and shall become           exercisable with respect to 25% of the Common Stock to
which it pertains;  






	 	(ii) 	on
the seven month and each successive month anniversary to and including the
          twenty threefour month anniversary, the
OptionAward shall vest and become exercisable
          with respect to an additional four (4%)           percent1/24 of
theshares of Common Stock to which it
          pertains ; and 






	 	(iii)	on
the twenty-four month anniversary of the Date of Grant, the Option shall           vest
and shall become exercisable with respect to balance of the Common
          Stock to which it  pertains.  






	 	
The
Plan Administrator may specify a vesting schedule for all or any portion of an OptionAward
 based on the achievement of performance objectives established in advance of the
commencement by the OptioneeParticipant of
services related to the achievement of the performance objectives. Performance objectives
shall be expressed in terms of objective criteria, including but not limited to, one or
more of the following: return on equity, return on assets, share price, market share,
sales, earnings per share, costs, net earnings, net worth, inventories, cash and cash
equivalents, gross margin or the Corporation’s performance relative to its internal
business plan. Performance objectives may be in respect of the performance of the
Corporation as a whole (whether on a consolidated or unconsolidated basis), a Related
Corporation, or a subdivision, operating unit, product or product line of either of the
foregoing. Performance objectives may be absolute or relative and may be expressed in
terms of a progression or a range. An OptionAward that
is exercisable (in full or in part) upon the achievement of one or more performance
objectives may be exercised only following written notice to the OptioneeParticipant and
the Corporation by the Plan Administrator that the performance objective has been
achieved.  







9








	 	(f) 	Acceleration
of Vesting 









	 	
The
vesting of one or more outstanding OptionsAward may
be accelerated by the Plan Administrator at such times and in such amounts as it shall
determine in its sole discretion.  






	 	(g) 	Term
of OptionAward






	 	(i) 	Vested
Options shall terminate, to the extent not previously exercised, upon the
          occurrence of the first of the following events:  






	 	A. 	the
expiration of the Option, as designated by the Plan Administrator in           accordance
with Section 7.1(d) above;  






	 	B. 	the
date an Optioneea Participant receives a
          notice of his or her termination of employment or contractual relationship with
          the Corporation or any Related Corporation for Cause (as hereinafter defined);
          or  






	 	C. 	the
expiration of fivethree          (53)
years, unless otherwise determined in           specific agreements by the Plan
Administrator, from the date of an OptioneeParticipant’s
termination of           employment or contractual relationship with the Corporation or
any Related           Corporation for any reason whatsoever other than Cause, but
including death or           disability, unless, in the case of a Non-Qualified Stock
Option, Section 102 Option or Section 3(i) Option, the exercise period is
extended by the           Plan Administrator until a date not later than the
expiration date of           the Option; . 






	 	(ii) 	Notwithstanding
Section 7.1(g)(i) above, any vested OptionsAwards which
have been granted to an Optioneea Participant in the OptioneeParticipant’s
capacity as a           director of the Corporation or any Related Corporation shall
terminate upon the           occurrence of the first of the following events:  






	 	A. 	the
event specified in Section 7.1(g)(i)A above;  






	 	B. 	the
expiration of fivethree          (53)
years, unless otherwise determined in           specific agreements by the Plan
Administrator, from the date the           Optioneesuch
Participant ceases to serve as a           director of the Corporation or Related
Corporation, as the case may be, unless, in the case of a Non-Qualified
Stock Option or Section 102 Option,           the exercise period is extended
by the Plan Administrator until a date           not later than the
expiration date of the Option.  






	 	(iii) 	Upon
the death of an Optioneea Participant,
          any vested option still in force and unexpired may be exercised by the person
or           persons to whom such OptioneeParticipant’s
rights under such Option shall pass by the OptioneeParticipant’s
will or by the           laws of descent and distribution ofat the
OptioneeParticipant’s domicile at the
          time of death, within a period of twelve (12thirty
          six (36) months after the date of such           terminationthe
Participant’s           death.  










10







	 	(iv) 	For
purposes of the Plan, unless otherwise defined in the Agreement, termination
          for “Cause” shall mean such termination is for ‘cause’ as
          such term is expressly defined in a then-effective written agreement between
the OptioneeParticipant and the Corporation
or           any Related Corporation, or in the absence of such then-effective written
          agreement and in the case of an Employee or an Israeli Employee, termination
for           the following reasons (i) conviction of any felony involving moral
turpitude or           affecting the Corporation; (ii) any refusal to carry out a
reasonable directive           of the chief executive officer, the Board or the OptioneeParticipant’s
direct supervisor,           which involves the business of the Corporation or its
Related Corporation and           was capable of being lawfully performed; (iii)
embezzlement of funds of the           Corporation or its Related Corporation; (iv) any
breach of the OptioneeParticipant’s
fiduciary duties           or duties of care of the Corporation; including without
limitation disclosure of           confidential information of the Corporation; and (v)
any conduct (other than           conduct in good faith) reasonably determined by the
Board to be materially           detrimental to the Corporation. Unless accelerated in
accordance with Section           7.1(f) above, unvested Options shall terminate
immediately upon termination of           employment or contractual relationship of
an           Optioneea Participant with
          the Corporation or a Related Corporation, or termination of an Optioneea
Participant’s services as a           director of the Corporation or a
Related Corporation, for any reason whatsoever,           including death or disability.  






	 	(v) 	For
purposes of this Plan, transfer of employment between or among the           Corporation
and/or any Related Corporation shall not be deemed to constitute a           termination
of employment with the Corporation or any Related Corporation.           Employment shall
be deemed to continue while the OptioneeParticipant is
on military leave,           sick leave or other bona fide leave of absence (as
determined by the Plan           Administrator). The foregoing notwithstanding,
employment shall not be deemed to           continue beyond the first ninety (90) days of
such leave, unless otherwise           determined in specific agreements by the Plan
Administrator and unless the OptioneeParticipant’s
re-employment           rights are guaranteed by statute or by contract.  






	 	(h) 	Exercise
of Options 






	 	(i) 	Options
shall be exercisable, in full or in part, at any time after vesting,           until
termination of right to           exercise. If
less than all of the shares of Common SharesStock included
in           the vested portion of any Optionoption are
          purchased, the remainder may be purchased at any subsequent time prior to the
          expiration of the Option termexercise
period.           Only a  whole share of Common
SharesStock may be issued pursuant to an
Optionoption, and to the extent that an
Optionoption covers less than one (1) share
of Common ShareStock, it is
unexercisable.  






11







	 	(ii) 	Options
or portions thereof may be exercised by giving written notice to the
          Corporation, in such form and method as may be determined by the Corporation
and           when applicable, by the Trustee in accordance with the requirements of
Section           102 of the Ordinance, which notice shall specify the number of shares
of Common SharesStock to be
          purchased, and be accompanied by payment in the amount of the aggregate
exercise           price for the Common SharesStock so
          purchased, which payment shall be in the form specified in Section 7.1(i)
below.           The Corporation shall not be obligated to issue, transfer or deliver a
          certificate representing shares of Common SharesStock to
the Holder of any Option,           until provision has been made by the Holder, to the
satisfaction of the           Corporation, for the payment of the aggregate exercise
price for all shares of Common SharesStock
 for which the Optionoption shall
          have been exercised and for satisfaction of any tax withholding obligations
          associated with such exercise. During the lifetime of an Optionee,
          OptionsParticipant, options are
exercisable only           by the OptioneeParticipant.  






	 	(iii) 	For
Israeli Employees the above mentioned in section h(ii) is subject to section
          102 and the trust mechanism as defined in section 5 of this Plan.  






	 	
With
respect to Unapproved 102 OptionAward, if
the OptioneeParticipant ceases to be
employed by the Corporation or any AfffiliateAffiliate,
the OptioneeParticipant shall extend to the
Corporation and/or its Affiliate a security or guarantee for the payment of tax due at
the time of sale of Sharesshares of Common Stock,
all in accordance with the provisions of Section 102 and the rules, regulation or orders
promulgated thereunder. 






	 	(i) 	Payment
upon Exercise of Option 






	 	
Upon
the exercise of any Optionoption, the
aggregate exercise price shall be paid to the Corporation in cash or by certified or
cashier’s check. In addition, if pre-approved in writing by the Plan Administrator
who may arbitrarily withhold consent, the Holder may pay for all or any portion of the
aggregate exercise price by complying with one or more of the following alternatives:  






	 	(i) 	by
delivering to the Corporation shares of Common SharesStock previously
held by such Holder,           or by the Corporation withholding shares of Common
SharesStock otherwise deliverable pursuant
to           exercise of the Optionoption,
which shares of Common SharesStock received
or withheld shall have a           fair market value at the date of exercise (as
determined by the Plan           Administrator) equal to the aggregate exercise price to
be paid by the OptioneeParticipant upon such exercise;  






12







	 	(ii) 	by
delivering a properly executed exercise notice together with irrevocable
          instructions to a broker promptly to sell or margin a sufficient portion of the
shares of Common SharesStock
 and deliver directly to the Corporation the amount of sale or margin
          loan proceeds to pay the exercise price; or  






	 	(iii) 	by
complying with any other payment mechanism approved by the Plan Administrator
          at the time of exercise.  






	   	(i1)  	Restricted
Stock  






	 	
An
Award of Restricted Stock, whether as 102 Award, Non-Qualified Award or Section 3(i)
Award, may be granted by the Corporation in a specified number of
shares of Common Stock of Corporation to the Participant, which
shares may or may no be subject to forfeiture or other restrictions
upon the happening of specified events (the term in which such restrictions apply shall
be referred to as the “Restriction Period”). Such an Award shall be subject to
the following terms and conditions: 






	 	(i)	Restricted
Stock shall be evidenced by Award agreements. Such agreements           shall conform to
the requirements of the Plan and may contain           such other
provisions as the Committee shall deem           advisable. 






	 	(ii)	Upon
determination of the number of shares of Restricted Stock to be granted           to a
Holder, the Committee shall direct that a certificate or
          certificates representing the number of shares of Common
          Stock of Corporation be issued to the Holder with the Holder designated as the
registered owner. If any restrictions apply to such shares
          of Restricted Stock, the certificate(s) representing such
          shares shall be legended as to sale, transfer, assignment,
          pledge or other encumbrances during the Restriction Period and deposited by
the Holder, together with a stock power endorsed in           blank, with the
Corporation, to be held in escrow during           the Restriction
Period. 






	 	(iii)	Unless
otherwise determined by the Committee at the time of an Award, during           the
Restriction Period the Holder shall have the right to receive
          dividends from and to vote the shares of Restricted Stock. 






	 	(iv)	The
Award Agreement shall specify the duration of the Restriction Period, if           any,
and the employment or other conditions (including           termination of
employment on account of death, disability, retirement or other
cause) under which shares of Restricted Stock may be           forfeited by the
Corporation. At the end of the           Restriction Period, if any, the restrictions imposed
shall           lapse with respect to the number of shares of Restricted Stock as determined
by the Committee, and the legend shall be           removed and such number of shares delivered
to the Holder           (or, where appropriate, the Holder’s legal representative).
The Committee may, in its sole discretion, modify or accelerate the
          vesting and delivery of shares of Restricted Stock, if
          those are subject to vesting. 






13







	   	(i2)  	Restricted
Stock Unit.  






	 	
The
Plan Administrator is authorized to make awards of Restricted Stock Units, whether as 102
Award, Non-Qualified Award or Section 3(i) Award, to any Employee or
Consultant in such amounts and subject to such terms and conditions
as the Plan Administrator shall deem appropriate. On the vesting date of a Restricted
Stock Unit, unless otherwise noted in the Award Agreement, the Corporation shall transfer
to the Participant one unrestricted, fully transferable, fully paid
and non-assessable share of Common Stock for each Restricted Stock
Unit scheduled to be paid out on such date and not previously forfeited. 






	 	(i)	All
Awards of restricted stock units made pursuant to this Plan will be           evidenced
by an Award Agreement and will comply with and be           subject to the
terms and conditions of this Plan. 






	 	(ii)	Unless
otherwise determined by the Committee at the time of an Award, during           the
Restriction Period the Holder shall not have the right to           receive
dividends from and to vote the shares underlying           the
Restricted Stock Units. 






	 	(iii)	Restricted
Stock Units shall be subject to such terms and conditions as the           Plan
Administrator may impose. These terms and
conditions may include restrictions based upon completion of a specified period of
service with the Corporation or an Affiliate as set out in advance in the
Participant’s individual Award Agreement. 







	 	(j) 	No
Rights as a Shareholder 






	 	
A
Holder shall have no rights as a shareholder of the Corporation with respect to any shares
of  Common SharesStock covered
by an Optionoption and to any unvested Restricted
Stock Unit until such Holder becomes a record holder of such Common Sharesshares,
irrespective of whether such Holder has given notice of exercise. Subject to the
provisions of Section 7.1(m) hereof, no rights shall accrue to a Holder and no
adjustments shall be made on account of dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distributions or other rights declared on, or
created in, the Common Shares for which the record date is prior to the date the Holder
becomes a record holder of the shares of Common Shares
covered by the OptionStock,
irrespective of whether such Holder has given notice of exercise. In case of
Options and Common Shares heldAwards and
shares of Common Stockheld by the Trustee, are subject to
the provisions of Section 5 of the Plan.  






14







	 	(k) 	Non-transferability
of Options






	 	
Options and
unvested Restricted Stocks and Restricted Stock Units granted under this
Plan and the rights and privileges conferred by this Plan may not be transferred,
assigned, pledged or hypothecated in any manner (whether by operation of law or
otherwise) other than by will, by applicable laws of descent and distribution, and shall
not be subject to execution, attachment or similar process. Upon any attempt to transfer,
assign, pledge, hypothecate or otherwise dispose of any OptionOptions
and unvested Restricted Stocks and Restricted Stock Units or of any right or
privilege conferred by this Plan contrary to the provisions hereof, or upon the sale,
levy or any attachment or similar process upon the rights and privileges conferred by
this Plan, such Optionoptions and unvested
Restricted Stocks and Restricted Stock Units shall thereupon terminate and become
null and void.  






	 	
As
long as Options and/or Common SharesAwards are
held by the Trustee on behalf of the OptioneeParticipant, all rights
of the OptioneeParticipant over the shares
of Common Shares areStockare personal,
can not be transferred, assigned, pledged or mortgaged, other than by will or pursuant to
the laws of descent and distribution.  






	 	(l) 	Securities
Regulation and Tax Withholding 






	 	(i) 	Shares
of Common SharesStock shall
not be issued with respect           to an Option unlessAward
(also in connection with the exercise of such
          Optionoption) and the issuance and
delivery of           such shares of Common SharesStock shall
comply with all Applicable           Laws, and such issuance shall be further subject to
the approval of counsel for           the Corporation with respect to such compliance,
including the availability of           an exemption from prospectus and registration
requirements for the issuance and           sale of such shares of Common
SharesStock. The inability of the Corporation to obtain
          from any regulatory body the authority deemed by the Corporation to be
necessary           for the lawful issuance and sale of any shares of Common
SharesStock under this Plan, or the
          unavailability of an exemption from prospectus and registration requirements
for           the issuance and sale of any shares of Common SharesStock under
this Plan, shall relieve           the Corporation of any liability with respect to the
non-issuance or sale of           such shares of Common SharesStock.  






15







	 	(ii) 	As
a condition to the exercise of an Option or issuance of other           Awards,
the Plan Administrator may require the Holder to           represent and warrant in
writing at the time of such exercise that the shares of Common
SharesStock are being purchased only for
          investment and without any then-present intention to sell or distribute such shares
of Common SharesStock. If           necessary under
Applicable Laws, the Plan Administrator may cause a           stop-transfer order against
such Common Shares to be placed on the stock books           and records of the
Corporation, and a legend indicating that the shares of Common SharesStock may
not be pledged, sold           or otherwise transferred unless an opinion of counsel is
provided stating that           such transfer is not in violation of any Applicable Laws,
may be stamped on the           certificates representing such shares of Common
SharesStock           in order to assure an exemption from registration. The Plan
Administrator also           may require such other documentation as may from time to
time be necessary to           comply with applicable securities laws. THE CORPORATION
HAS NO OBLIGATION TO           UNDERTAKE REGISTRATION OF OPTIONS OR THE COMMON SHARES
ISSUABLE UPON THE           EXERCISE OF OPTIONS OR ISSUANCE OF OTHER AWARDS.  






	 	(iii) 	The
Holder shall pay to the Corporation by certified or cashier’s check,
          promptly upon exercise of an Optionoption or,
          if sooner or later, the date that the amount of such obligations becomes
          determinable upon any Award, all applicable federal,
state,           local and foreign withholding taxes that the Plan Administrator or the
Trustee,           in their discretion, subject to section 102 in case of Israeli
Employees,           determines to result upon exercise of an Optionoption or
from a transfer or other           disposition of shares of  Common
SharesStock acquired upon exercise of an
Optionoption or otherwise related to an
Optionoption or shares of Common
SharesStock acquired in           connection
with an Option or issuance of shares           underlying a
different Award. Furthermore, the Holder shall agree           to
indemnify the Corporation and/or its Affiliates and/or the Trustee and hold
          them harmless against and from any and all liability for any such tax or
          interest or penalty thereon, including without limitation, liabilities relating
          to the necessity to withhold, or to have withheld, any such tax from any
payment           made to the Holder. Upon approval of the Plan Administrator, a Holder
may           satisfy such obligation by complying with one or more of the following
          alternatives selected by the Plan Administrator:  






     	 	A. 	
          by delivering to the Corporation shares of Common
          SharesStock previously held by such Holder or
          by the Corporation withholding shares of Common
          SharesStock otherwise deliverable pursuant to
          the exercise of the Optionoption or issuance of
          shares underlying  a different Award, which
          shares of Common
          SharesStock received or withheld shall have a
          fair market value (as determined by the Plan Administrator) equal to the minimum
          mandatory withholding tax obligations arising as a result of such exercise,
          transfer or other disposition; or 


          



16







     	 	B. 	
          by complying with any other payment mechanism approved by the Plan Administrator
          from time to time. 


          



	 	(iv) 	The
issuance, transfer or delivery of certificates representing shares of Common
SharesStock pursuant to           the
exercise of Optionsoptions or issuance of shares
          underlying a different Award may be delayed, at the discretion of the
          Plan Administrator, until the Plan Administrator is satisfied that the
          applicable requirements of all Applicable Laws and the withholding provisions
of           the Code and/or the Ordinance have been met and that the Holder has paid or
          otherwise satisfied any withholding tax obligation as described in Section
          7.1(l)(iii) above.  






	 	(m) 	Adjustments
Upon Changes In Capitalization 






	 	(i) 	The
aggregate number (in the case of Incentive Stock Options and for           purposes
of the limit in Section 6.2 above) and class of
shares for which OptionsAwards may be
granted under this Plan,           the number and class of shares covered by each
outstanding OptionAward, and the exercise
price per share           thereof (but not the total price), and each such OptionAward,
shall all be proportionately           adjusted for any increase or decrease in the
number of issued Common Shares of           the Corporation resulting from:  






	 	A. 	a
subdivision or consolidation of Common Shares or any like capital adjustment,
          or  






	 	B. 	the
issuance of any shares of Common SharesStock,
or securities exchangeable for           or convertible into shares of Common
SharesStock, to the holders of all or
          substantially all of the outstanding shares of Common
SharesStock by way of a stock dividend
(other           than the issue of shares of Common SharesStock,
or securities exchangeable for           or convertible into shares of Common
SharesStock, to holders of shares of
 Common SharesStock pursuant
          to their exercise of options to receive dividends in the form of shares
of Common SharesStock, or
          securities convertible into shares of Common SharesStock,
in lieu of dividends paid in the           ordinary course on the shares of Common
SharesStock).  






17







	 	(ii) 	Except
as provided in Section 7.1(m)(iii) hereof, upon a merger (other than a           merger
of the Corporation in which the holders of Common Shares immediately           prior to
the merger have the same proportionate ownership of common shares in           the
surviving corporation immediately after the merger), consolidation,           acquisition
of property or stock, separation, reorganization (other than a mere
          re-incorporation or the creation of a holding Corporation) or liquidation of
the           Corporation, as a result of which the shareholders of the Corporation,
receive           cash, shares or other property in exchange for or in connection with
their shares of Common SharesStock,
any OptionAward granted hereunder shall
          terminate, but the Holder shall have the right to exercise such Holder’s
OptionAward immediately prior to any such merger,
          consolidation, acquisition of property or shares, separation, reorganization or
          liquidation, and to be treated as a shareholder of record for the purposes
          thereof, to the extent the vesting requirements set forth in the OptionAward agreement
have been satisfied.  






	 	(iii) 	If
the shareholders of the Corporation receive shares in the capital of another
          corporation (“Exchange Shares”) in exchange for their shares of
Common SharesStock in any
          transaction involving a merger (other than a merger of the Corporation in which
          the holders of shares of Common SharesStock immediately
prior to the merger           have the same proportionate ownership of shares of
Common SharesStock in the
surviving corporation           immediately after the merger), consolidation, acquisition
of property or shares,           separation or reorganization (other than a mere
re-incorporation or the creation           of a holding Corporation), all OptionsAwards          granted
hereunder shall be converted into optionsAwards to
purchase Exchange           Shares, unless the Corporation and the
corporation issuing           the Exchange Shares, in their sole discretion, determine
that any or all such OptionsAwards granted
hereunder shall not be           converted into optionsAwards to
purchase           Exchange Shares but instead shall terminate in accordance with, and
subject to           the Holder’s right to exercise the Holder’s OptionsAwards pursuant
to, the provisions of           Section 7.1(m)(ii). The amount and price of converted
optionsAwards shall be determined by
          adjusting the amount and price of the OptionsAwards granted
hereunder in the same           proportion as used for determining the number of Exchange
Shares the holders of           the shares of Common SharesStock receive
in such merger,           consolidation, acquisition or property or stock, separation or
reorganization.           Unless accelerated by the Board, the vesting schedule set forth
in the option           agreement shall continue to apply to the optionsAwards granted
for the Exchange           Shares.  






	 	(iv) 	In
the event of any adjustment in the number of shares of Common
SharesStock covered by           any OptionAward,
any fractional shares           resulting from such adjustment shall be disregarded and
each such OptionAward shall cover only the
number of           full shares resulting from such adjustment.  






	 	(v) 	All
adjustments pursuant to Section 7.1(m) shall be made by the Plan           Administrator,
and its determination as to what adjustments shall be made, and           the extent
thereof, shall be final, binding and conclusive.  






18







	 	(vi) 	The
grant of an OptionAward shall not affect
          in any way the right or power of the Corporation to make adjustments,
          reclassifications, reorganizations or changes of its capital or business
          structure, to merge, consolidate or dissolve, to liquidate or to sell or
          transfer all or any part of its business or assets.  






	8. 	EFFECTIVE
DATE; AMENDMENT; SHAREHOLDER APPROVAL






8.1     Options
may be granted by the Plan Administrator from time to time on or after the date on which
this Plan is adopted by the Board (the “Effective Date”). In case of the
Israeli Optionees, Approved 102 Options will be granted only after the lapse of at least
30 days following the date in which the Plan and the relevant forms will be submitted to
the tax authorities as detailed in Section 4.6 above. 



8.1    8.2
Unless sooner terminated by the Board, this Plan shall
terminate on the tenth anniversary of the Effective Date.December
31, 2018. No Option may be granted after such termination or during any
suspension of this Plan.  



8.2    8.3
Any Incentive Stock Options granted by the Plan Administrator prior to the
ratification of this Plan by the shareholders of the Corporation shall be granted subject
to approval of this Plan by the holders of a majorityshareholders of
the Corporation’s outstanding voting shares, voting either in person or by proxy at
a duly held shareholders’meeting within twelve (12) months before or after the
Effective Datedate this Amended and Restated 2005
Stock Option Plan is approved by the Board. If such shareholder approval is
sought and not obtained, all Incentive Stock Options granted prior thereto and thereafter
shall be considered Non-Qualified Stock OptionsAwards and
any OptionsAwards granted to Covered
Employees will not be eligible for the exclusion set forth in Section 162(m) of the Code
with respect to the deductibility by the Corporation of certain compensation.  



9.     NO OBLIGATIONS TO
EXERCISE OPTION  



The grant of an
Optionoption shall impose no obligation upon the
OptioneeParticipant to exercise such Optionoption. 



10.     NO RIGHT TO
OPTIONSAWARD OR TO EMPLOYMENT 



Whether or not any
OptionsAwards are to be granted under this Plan shall
be exclusively within the discretion of the Plan Administrator, and nothing
contained in this Plan shall be construed as giving any person any right to participate
under this Plan. The grant of an OptionAward shall in
no way constitute any form of agreement or understanding binding on the Corporation or any
Related Corporation, express or implied, that the Corporation or any Related Corporation
will employ or contract with an OptioneeParticipant for
any length of time, nor shall it interfere in any way with the Corporation’s or,
where applicable, a Related Corporation’s right to terminate
OptioneeParticipant’s employment at any time,
which right is hereby reserved. 



19







11.     APPLICATION OF FUNDS  



The proceeds received by the
Corporation from the sale of Common Shares issued upon the exercise of
OptionsAwards shall be used for general corporate
purposes, unless otherwise directed by the Board. 



12.     INDEMNIFICATION OF
PLAN ADMINISTRATOR  



In addition to all other rights of
indemnification they may have as members of the Board, members of the Plan Administrator
shall be indemnified by the Corporation for all reasonable expenses and liabilities of any
type or nature, including attorneys’ fees, incurred in connection with any action,
suit or proceeding to which they or any of them are a party by reason of, or in connection
with, this Plan or any OptionAward granted under this
Plan, and against all amounts paid by them in settlement thereof (provided that such
settlement is approved by independent legal counsel selected by the Corporation), except
to the extent that such expenses relate to matters for which it is adjudged that such Plan
Administrator member is liable for wilful misconduct; provided, that within fifteen (15)
days after the institution of any such action, suit or proceeding, the Plan Administrator
member involved therein shall, in writing, notify the Corporation of such action, suit or
proceeding, so that the Corporation may have the opportunity to make appropriate
arrangements to prosecute or defend the same. 



13.     AMENDMENT OF PLAN  



TheSubject
to additional consents and approvals required under Applicable Law, the Plan
Administrator may, at any time, modify, amend or terminate this Plan or modify or amend
OptionsAwards granted under this Plan, including,
without limitation, such modifications or amendments as are necessary to maintain
compliance with the Applicable Laws. The Plan Administrator may condition the
effectiveness of any such amendment on the receipt of shareholder approval at such time
and in such manner as the Plan Administrator may consider necessary for the Corporation to
comply with or to avail the Corporation and/or the Optionees of the benefits of any
securities, tax, market listing or other administrative or regulatory requirements. 



Effective Date:
September 18, 2006 




20