ISRAELI
        SHARE OPTION PLAN

    

    
      
        

      

    

     

     

    
      
        
          


          Incredimail
            Ltd.

          


          THE
            2003 ISRAELI SHARE OPTION PLAN

          


          (*In
            compliance with Amendment No. 132 of the Israeli Tax Ordinance,
            2002)

          


          


          


          


          
            
              
              

            

            
              1

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          TABLE
            OF CONTENTS

          


          
            	
                    1.

                  	
                    PURPOSE
                      OF THE ISOP

                  	
                    3

                  
	 	 	 
	
                    2.

                  	
                    DEFINITIONS

                  	
                    3

                  
	 	 	 
	
                    3.

                  	
                    ADMINISTRATION
                      OF THE ISOP

                  	
                    6

                  
	 	 	 
	
                    4.

                  	
                    DESIGNATION
                      OF PARTICIPANTS

                  	
                    7

                  
	 	 	 
	
                    5.

                  	
                    DESIGNATION
                      OF OPTIONS PURSUANT TO SECTION 102

                  	
                    8

                  
	 	 	 
	
                    6.

                  	
                    TRUSTEE

                  	
                    9

                  
	 	 	 
	
                    7.

                  	
                    SHARES
                      RESERVED FOR THE ISOP

                  	
                    9

                  
	 	 	 
	
                    8.

                  	
                    PURCHASE
                      PRICE

                  	
                    10

                  
	 	 	 
	
                    9.

                  	
                    ADJUSTMENTS

                  	
                    10

                  
	 	 	 
	
                    10.

                  	
                    TERM
                      AND EXERCISE OF OPTIONS

                  	
                    12

                  
	 	 	 
	
                    11.

                  	
                    VESTING
                      OF OPTION

                  	
                    14

                  
	 	 	 
	
                    12.

                  	
                    SHARES
                      SUBJECT TO RIGHT OF FIRST REFUSAL

                  	
                    14

                  
	 	 	 
	
                    13.

                  	
                    DIVIDENDS

                  	
                    15

                  
	 	 	 
	
                    14.

                  	
                    RESTRICTIONS
                      ON ASSIGNABILITY AND SALE OF OPTIONS

                  	
                    15

                  
	 	 	 
	
                    15.

                  	
                    EFFECTIVE
                      DATE AND DURATION OF THE ISOP

                  	
                    15

                  
	 	 	 
	
                    16.

                  	
                    AMENDMENTS
                      OR TERMINATION

                  	
                    16

                  
	 	 	 
	
                    17.

                  	
                    GOVERNMENT
                      REGULATIONS

                  	
                    16

                  
	 	 	 
	
                    18.

                  	
                    CONTINUANCE
                      OF EMPLOYMENT OR HIRED SERVICES

                  	
                    16

                  
	 	 	 
	
                    19.

                  	
                    GOVERNING
                      LAW & JURISDICTION

                  	
                    16

                  
	 	 	 
	
                    20.

                  	
                    TAX
                      CONSEQUENCES

                  	
                    16

                  
	 	 	 
	
                    21.

                  	
                    NON-EXCLUSIVITY
                      OF THE ISOP

                  	
                    17

                  
	 	 	 
	
                    22.

                  	
                    MULTIPLE
                      AGREEMENTS

                  	
                    17

                  


          

           

          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          This
            plan, as amended from time to time, shall be known as Incredimail Ltd.
            2003
            Israeli Share Option Plan (the “ISOP”).

          


          
            	1.	
                    PURPOSE
                      OF THE ISOP

                  


          

          


          The
            ISOP
            is intended to provide an incentive to retain, in the employ of the Company
            and
            its Affiliates (as defined below), persons of training, experience, and
            ability,
            to attract new employees, directors, consultants, service providers and
            any
            other entity which the Board shall decide their services are considered
            valuable
            to the Company, to encourage the sense of proprietorship of such persons,
            and to
            stimulate the active interest of such persons in the development and
            financial
            success of the Company by providing them with opportunities to purchase
            shares
            in the Company, pursuant to the ISOP.

          


          
            	2.	
                    DEFINITIONS

                  


          

          


          For
            purposes of the ISOP and related documents, including the Option Agreement,
            the
            following definitions shall apply:

          


          
            	
                  	
                    2.1

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

                  


          

          


          
            	
                  	
                    2.2

                  	
                    “Approved
                      102 Option” means
                      an Option granted pursuant to Section 102(b) of the Ordinance
                      and held in
                      trust by a Trustee for the benefit of the
                      Optionee.

                  


          

          


          
            	
                  	
                    2.3

                  	
                    “Board” means
                      the Board of Directors of the
                      Company.

                  


          

          


          
            	
                  	
                    2.4

                  	
                    “Capital
                      Gain Option (CGO)” as
                      defined in Section 5.4 below.

                  


          

          


          
            	
                  	
                    2.5

                  	
                    “Cause” means,
                      (i) conviction of any felony involving moral turpitude or affecting
                      the
                      Company; (ii) any refusal to carry out a reasonable directive
                      of the chief
                      executive officer, the Board or the Optionee’s direct supervisor, which
                      involves the business of the Company or its Affiliates and
                      was capable of
                      being lawfully performed; (iii) embezzlement of funds of the
                      Company or
                      its Affiliates; (iv) any breach of the Optionee’s fiduciary duties or
                      duties of care of the Company; including without limitation
                      disclosure of
                      confidential information of the Company; and (v) any conduct
                      (other than
                      conduct in good faith) reasonable determined by the Board to
                      be materially
                      detrimental to the Company.

                  


          

          


          
            	
                  	
                    2.6

                  	
                    “Chairman” means
                      the chairman of the Committee.

                  


          

          


          
            	
                  	
                    2.7

                  	
                    “Committee” means
                      a share option compensation committee appointed by the Board,
                      which shall
                      consist of no fewer than two members of the
                      Board.

                  


          

          


          
            	
                  	
                    2.8

                  	
                    “Company” means
                      Incredimail ltd., an Israeli
                      company.

                  


          

          


          
            	
                  	
                    2.9

                  	
                    “Companies
                      Law” means
                      the Israeli Companies Law
                      5759-1999.

                  


          

          


          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    2.10

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

                  


          

          


          
            	
                  	
                    2.11

                  	
                    “Date
                      of Grant” means
                      the date of grant of an Option, as determined by the Board
                      and set forth
                      in the Optionee’s Option Agreement.

                  


          

          


          
            	
                  	
                    2.12

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

                  


          

          


          
            	
                  	
                    2.13

                  	
                    “Expiration
                      date” means
                      the date upon which an Option shall expire, as set forth in
                      Section 10.2
                      of the ISOP.

                  


          

          


          
            	
                  	
                    2.14

                  	
                    “Fair
                      Market Value” means
                      as of any date, the value of a Share determined as
                      follows:

                  


          

          


          (i) If
            the
            Shares are listed on any established stock exchange or a national market
            system,
            including without limitation the NASDAQ National Market system, or the
            NASDAQ
            SmallCap Market of the NASDAQ Stock Market, the Fair Market Value shall
            be the
            closing sales price for such Shares (or the closing bid, if no sales
            were
            reported), as quoted on such exchange or system for the last market trading
            day
            prior to time of determination, as reported in the Wall Street Journal,
            or such
            other source as the Board deems reliable. Without derogating from the
            above,
            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 Company’s shares are
            listed on any established stock exchange or a national market system
            or if the
            Company’s shares will be registered for trading within ninety (90) days
            following the Date of Grant, the Fair Market Value of a Share at the
            Date of
            Grant shall be determined in accordance with the average value of the
            Company’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;

          


          (ii) If
            the
            Shares are regularly quoted by a recognized securities dealer but selling
            prices
            are not reported, the Fair Market Value shall be the mean between the
            high bid
            and low asked prices for the Shares on the last market trading day prior
            to the
            day of determination, or;

          


          (iii) In
            the
            absence of an established market for the Shares, the Fair Market Value
            thereof
            shall be determined in good faith by the Board.

          


          
            	
                  	
                    2.15

                  	
                    “IPO” means
                      the initial public offering of the Company’s
                      shares.

                  


          

          


          
            	
                  	
                    2.16

                  	
                    “ISOP” means
                      this 2003 Israeli Share Option
                      Plan.

                  


          

          


          
            	
                  	
                    2.17

                  	
                    “ITA” means
                      the Israeli Tax Authorities

                  


          

          


          
            	
                  	
                    2.18

                  	
                    “Non-Employee” means
                      a consultant, adviser, service provider, Controlling Shareholder
                      or any
                      other person who is not an
                      Employee.

                  


          

          


          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    2.19

                  	
                    “Ordinary
                      Income Option (OIO” as
                      defined in Section 5.5 below.

                  


          

          


          
            	
                  	
                    2.20

                  	
                    “Option” means
                      an option to purchase one or more Shares of the Company pursuant
                      to the
                      ISOP.

                  


          

          


          
            	
                  	
                    2.21

                  	
                    “102
                      Option” means
                      any Option granted to Employees pursuant to Section 102 of
                      the
                      Ordinance.

                  


          

          


          
            	
                  	
                    2.22

                  	
                    “3(i)
                      Option” means
                      an Option granted pursuant to Section 3(i) of the Ordinance
                      to any person
                      who is Non-Employee.

                  


          

          


          
            	
                  	
                    2.23

                  	
                    “Optionee”means
                      a person who receives or holds an Option under the
                      ISOP.

                  


          

          


          
            	
                  	
                    2.24

                  	
                    “Option
                      Agreement” means
                      the share option agreement between the Company and an Optionee
                      that sets
                      out the terms and conditions of an
                      Option.

                  


          

          


          
            	
                  	
                    2.25

                  	
                    “Ordinance” means
                      the 1961 Israeli Income Tax Ordinance [New Version] 1961 as
                      now in effect
                      or as hereafter amended.

                  


          

          


          
            	
                  	
                    2.26

                  	
                    “Purchase
                      Price” means
                      the price for each Share subject to an
                      Option.

                  


          

          


          
            	
                  	
                    2.27

                  	
                    “Section
                      102” means
                      section 102 of the Ordinance as now in effect or as hereafter
                      amended.

                  


          

          


          
            	
                  	
                    2.28

                  	
                    “Share” means
                      the ordinary shares, NIS 0.01 par value each, of the
                      Company.

                  


          

          


          
            	
                  	
                    2.29

                  	
                    “Successor
                      Company” means
                      any entity the Company is merged to or is acquired by, in which
                      the
                      Company is not the surviving
                      entity.

                  


          

          


          
            	
                  	
                    2.30

                  	
                    “Transaction” means
                      (i) merger, acquisition or reorganization of the Company with
                      one or more
                      other entities in which the Company is not the surviving entity,
                      (ii) a
                      sale of all or substantially all of the assets of the
                      Company.

                  


          

          


          
            	
                  	
                    2.31

                  	
                    “Trustee” means
                      any individual appointed by the Company to serve as a trustee
                      and approved
                      by the ITA, all in accordance with the provisions of Section
                      102(a) of the
                      Ordinance.

                  


          

          


          
            	
                  	
                    2.32

                  	
                    “Unapproved
                      102 Option” means
                      an Option granted pursuant to Section 102© of the Ordinance and not held
                      in trust by a trustee.

                  


          

          


          
            	
                  	
                    2.33

                  	
                    “Vested
                      Option” means
                      any Option, which has already been vested according to the
                      Vesting
                      Dates.

                  


          

          


          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    2.34

                  	
                    “Vesting
                      Dates” means,
                      as determined by the Board or by the Committee, the date as
                      of which the
                      Optionee shall be entitled to exercise the Options or part
                      of the Options,
                      as set forth in section 11 of the
                      ISOP.

                  


          

          


          
            	3.	
                    ADMINISTRATION
                      OF THE ISOP

                  


          

          


          
            	
                  	
                    3.1

                  	
                    The
                      Board shall have the power to administer the ISOP either directly
                      or upon
                      the recommendation of the Committee, all as provided by applicable
                      law and
                      in the Company’s Articles of Association. Notwithstanding the above, the
                      Board shall automatically have residual authority if no Committee
                      shall be
                      constituted or if such Committee shall cease to operate for
                      any
                      reason.

                  


          

          


          
            	
                  	
                    3.2

                  	
                    The
                      Committee shall select one of its members as its Chairman and
                      shall hold
                      its meetings at such times and places as the Chairman shall
                      determine. The
                      Committee shall keep records of its meetings and shall make
                      such rules and
                      regulations for the conduct of its business as it shall deem
                      advisable.

                  


          

          


          
            	
                  	3.3	
                    The
                      Committee shall have the power to recommend to the Board and
                      the Board
                      shall have the full power and authority to: (i) designate participants;
                      (ii) determine the terms and provisions of the respective Option
                      Agreements, including, but not limited to, the number of Options
                      to be
                      granted to each Optionee, the number of Shares to be covered
                      by each
                      Option, provisions concerning the time and the extent to which
                      the Options
                      may be exercised and the nature and duration of restrictions
                      as to the
                      transferability or restrictions constituting substantial risk
                      of
                      forfeiture and to cancel or suspend awards, as necessary; (iii)
                      determine
                      the Fair Market Value of the Shares covered by each Option;
                      (iv) make an
                      election as to the type of 102 Approved Option; and (v) designate
                      the type
                      of Options.

                  


          

          


          The
            Committee shall have full power and authority to: (i) alter any restrictions
            and
            conditions of any Options or Shares subject to any Options (ii) interpret
            the
            provisions and supervise the administration of the ISOP; (iii) accelerate
            the
            right of an Optionee to exercise in whole or in part, any previously
            granted
            Option; (iv) determine the Purchase Price of the Option; (v) prescribe,
            amend
            and rescind rules and regulations relating to the ISOP; and (vi) make
            all other
            determinations deemed necessary or advisable for the administration of
            the ISOP,
            including, without limitation, to adjust the terms of the ISOP or any
            Option
            Agreement so as to reflect (a) changes in applicable laws and (b) the
            laws of
            other jurisdictions within which the Company wishes to grant
            Options.

          


          
            	
                  	3.4	
                    Notwithstanding
                      the above, the Committee shall not be entitled to grant Options
                      to the
                      Optionees, however, it will be authorized to issue Shares underlying
                      Options which have been granted by the Board and duly exercised
                      pursuant
                      to the provisions herein in accordance with section 112(a)(5)
                      of the
                      Companies Law.

                  


          

          


          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    3.5
                      

                  	
                    The
                      Board shall have the authority to grant, at its discretion,
                      to the holder
                      of an outstanding Option, in exchange for the surrender and
                      cancellation
                      of such Option, a new Option having a purchase price equal
                      to, lower than
                      or higher than the Purchase Price of the original Option so
                      surrendered
                      and canceled and containing such other terms and conditions
                      as the
                      Committee may prescribe in accordance with the provisions of
                      the
                      ISOP.

                  


          

          


          
            	
                  	
                    3.6
                      

                  	
                    Subject
                      to the Company’s Articles of Association, all decisions and selections
                      made by the Board or the Committee pursuant to the provisions
                      of the ISOP
                      shall be made by a majority of its members except that no member
                      of the
                      Board or the Committee shall vote on, or be counted for quorum
                      purposes,
                      with respect to any proposed action of the Board or the Committee
                      relating
                      to any Option to be granted to that member. Any decision reduced
                      to
                      writing shall be executed in accordance with the provisions
                      of the
                      Company’s Articles of Association, as the same may be in effect from
                      time
                      to time.

                  


          

          


          
            	
                  	
                    3.7
                      

                  	
                    The
                      interpretation and construction by the Committee of any provision
                      of the
                      ISOP or of any Option Agreement thereunder shall be final and
                      conclusive
                      unless otherwise determined by the
                      Board.

                  


          

          


          
            	
                  	
                    3.8

                  	
                    Subject
                      to the Company’s Articles of Association and the Company’s decision, and
                      to all approvals legally required, including, but not limited
                      to the
                      provisions of the Companies Law, each member of the Board or
                      the Committee
                      shall be indemnified and held harmless by the Company against
                      any cost or
                      expense (including counsel fees) reasonably incurred by him,
                      or any
                      liability (including any sum paid in settlement of a claim
                      with the
                      approval of the Company) arising out of any act or omission
                      to act in
                      connection with the ISOP unless arising out of such member’s own fraud or
                      bad faith, to the extent permitted by applicable law. Such
                      indemnification
                      shall be in addition to any rights of indemnification the member
                      may have
                      as a director or otherwise under the Company’s Articles of Association,
                      any agreement, any vote of shareholders or disinterested directors,
                      insurance policy or otherwise.

                  


          

          


          
            	4.	
                    DESIGNATION
                      OF PARTICIPANTS

                  


          

          


          
            	
                  	
                    4.1

                  	
                    The
                      persons eligible for participation in the ISOP as Optionees
                      shall include
                      any Employees and/or Non-Employees of the Company or of any
                      Affiliate;
                      provided, however, that (i) Employees may only be granted 102
                      Options;
                      (ii) Non-Employees may only be granted 3(i) Options; and (iii)
                      Controlling
                      Shareholders may only be granted 3(i)
                      Options.

                  


          

          


          
            	
                  	
                    4.2

                  	
                    The
                      grant of an Option hereunder shall neither entitle the Optionee
                      to
                      participate nor disqualify the Optionee from participating
                      in, any other
                      grant of Options pursuant to the ISOP or any other option or
                      share plan of
                      the Company or any of its
                      Affiliates.

                  


          

          


          
            	
                  	
                    4.3

                  	
                    Anything
                      in the ISOP to the contrary notwithstanding, all grants of
                      Options to
                      directors and office holders shall be authorized and implemented
                      in
                      accordance with the provisions of the Companies Law or any
                      successor act
                      or regulation, as in effect from time to
                      time.

                  


          

          


          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	5.	
                    DESIGNATION
                      OF OPTIONS PURSUANT TO SECTION
                      102

                  


          

          


          
            	
                  	
                    5.1

                  	
                    The
                      Company may designate Options granted to Employees pursuant
                      to Section 102
                      as Unapproved 102 Options or Approved 102
                      Options.

                  


          

          


          
            	
                  	
                    5.2

                  	
                    The
                      grant of Approved 102 Options shall be made under this ISOP
                      adopted by the
                      Board as described in Section 15 below, and shall be conditioned
                      upon the
                      approval of this ISOP by the ITA.

                  


          

          


          
            	
                  	
                    5.3

                  	
                    Approved
                      102 Option may either be classified as Capital Gain Option
                      (“CGO”)
                      or Ordinary Income Option (“OIO”).

                  


          

          


          
            	
                  	
                    5.4

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

                  


          

          


          
            	
                  	
                    5.5

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

                  


          

          


          
            	
                  	
                    5.6

                  	
                    The
                      Company’s election of the type of Approved 102 Options as CGI or OIO
                      granted to Employees (the “Election”),
                      shall be appropriately filed with the ITA in the framework
                      of the request
                      for the approval of this ISOP, which shall be submitted to
                      ITA at least 30
                      days prior to the Date of Grant of an Approved 102 Option.
                      Such Election
                      shall become effective beginning the first Date of Grant of
                      an Approved
                      102 Option under this ISOP and shall remain in effect until
                      the end of the
                      year following the year during which the Company first granted
                      Approved
                      102 Options. The Election shall obligate the Company to grant
only
                      the type of Approved 102 Option it has elected, and shall apply
                      to all
                      Optionees who were granted Approved 102 Options 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 Company from granting Unapproved 102 Options
                      simultaneously.

                  


          

          


          
            	
                  	
                    5.7

                  	
                    All
                      Approved 102 Options must be held in trust by a Trustee, as
                      described in
                      Section 6 below.

                  


          

          


          
            	
                  	
                    5.8

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

                  


          

          


          
            	
                  	
                    5.9

                  	
                    The
                      provisions of the ISOP and/or the Option 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 ISOP
                      and of the Option 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
                      ISOP or the Option Agreement, shall be considered binding upon
                      the Company
                      and the Optionees.

                  


          

          


          
            
              
              

            

            
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                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	6.	
                    TRUSTEE

                  


          

          


          
            	
                  	
                    6.1

                  	
                    Approved
                      102 Options which shall be granted under the ISOP and/or any
                      Shares
                      allocated or issued upon exercise of such Approved 102 Options
                      and/or
                      other shares received subsequently following any realization
                      of rights
                      and/or any rights granted to the Optionee by virtue of the
                      Approved 102
                      Options (including bonus shares), shall be allocated or issued
                      to the
                      Trustee and held for the benefit of the Optionees for such
                      period of time
                      as required by Section 102 or any regulations, rules or orders
                      or
                      procedures promulgated thereunder, and in accordance with the
                      Election
                      made by the Company according to section 5.5
                      above.

                  


          

          


          
            	
                  	
                    6.2

                  	
                    Notwithstanding
                      anything to the contrary, the Trustee shall not release any
                      Shares
                      allocated or issued upon exercise of Approved 102 Options prior
                      to the
                      full payment of the Optionee’s tax liabilities arising from Approved 102
                      Options which were granted to him and/or any Shares allocated
                      or issued
                      upon exercise of such Options.

                  


          

          


          
            	
                  	
                    6.3

                  	
                    Upon
                      receipt of Approved 102 Option, 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 ISOP, or
                      any Approved 102 Option or Share granted to him
                      thereunder.

                  


          

          


          
            	7.	
                    SHARES
                      RESERVED FOR THE ISOP; RESTRICTION
                      THEREON

                  


          

          


          
            	
                  	
                    7.1

                  	
                    The
                      Company has reserved 8,000 (eight thousands) authorized but
                      unissued
                      Shares, for the purposes of the ISOP, subject to adjustment
                      as set forth
                      in Section 9 below. Any Shares which remain unissued and which
                      are not
                      subject to the outstanding Options at the termination of the
                      ISOP shall
                      cease to be reserved for the purpose of the ISOP. Should any
                      Option for
                      any reason expire or be canceled prior to its exercise or relinquishment
                      in full, the Shares subject to such Option may again be subjected
                      to an
                      Option under the ISOP or under the Company’s other share option
                      plans.

                  


          

          


          
            	
                  	
                    7.2

                  	
                    Each
                      Option granted pursuant to the ISOP, shall be evidenced by
                      a written
                      Option Agreement between the Company and the Optionee, in such
                      form as the
                      Board or the Committee shall from time to time approve. Each
                      Option
                      Agreement shall state, among other matters, the number of Shares
                      to which
                      the Option relates, the type of Option granted thereunder (whether
                      a CGI,
                      OIO, Unapproved 102 Option or a 3(i) Option), the Vesting Dates,
                      the
                      Purchase Price per share, the Expiration Date and such other
                      terms and
                      conditions as the Committee or the Board in its discretion
                      may prescribe,
                      provided that they are consistent with this
                      ISOP.

                  


          

          


          
            	
                  	
                    7.3

                  	
                    Until
                      the consummation of an IPO, such Shares shall be voted by an
                      irrevocable
                      proxy (the “Proxy”)
                      pursuant to the directions of the Board, such Proxy to be assigned
                      to the
                      person or persons designated by the Board. Such person or persons
                      designated by the Board shall be indemnified and held harmless
                      by the
                      Company against any cost or expense (including counsel fees)
                      reasonably
                      incurred by him/her, or any liability (including any sum paid
                      in
                      settlement of a claim with the approval of the Company) arising
                      out of any
                      act or omission to act in connection with the voting of such
                      Proxy unless
                      arising out of such member’s own fraud or bad faith, to the extent
                      permitted by applicable law. Such indemnification shall be
                      in addition to
                      any rights of indemnification the person(s) may have as a director
                      or
                      otherwise under the Company’s Articles of Association, any agreement, any
                      vote of shareholders or disinterested directors, insurance
                      policy or
                      otherwise.

                  


          

          


          
            
              
              

            

            
              9

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	8.	
                    PURCHASE
                      PRICE

                  


          

          


          
            	
                  	
                    8.1

                  	
                    The
                      Purchase Price of each Share subject to an Option shall be
                      determined by
                      the Committee in its sole and absolute discretion in accordance
                      with
                      applicable law, subject to any guidelines as may be determined
                      by the
                      Board from time to time. Each Option Agreement will contain
                      the Purchase
                      Price determined for each Optionee.

                  


          

          


          
            	
                  	
                    8.2

                  	
                    The
                      Purchase Price shall be payable upon the exercise of the Option
                      in a form
                      satisfactory to the Committee, including without limitation,
                      by cash or
                      check. The Committee shall have the authority to postpone the
                      date of
                      payment on such terms as it may
                      determine.

                  


          

          


          
            	
                  	
                    8.3

                  	
                    The
                      Purchase Price shall be denominated in the currency of the
                      primary
                      economic environment of, either the Company or the Optionee
                      (that is the
                      functional currency of the Company or the currency in which
                      the Optionee
                      is paid) as determined by the
                      Company.

                  


          

          


          
            	9.	
                    ADJUSTMENTS

                  


          

          


          Upon
            the
            occurrence of any of the following described events, Optionee’s rights to
            purchase Shares under the ISOP shall be adjusted as hereafter
            provided:

          


          
            	
                  	
                    9.1

                  	
                    In
                      the event of Transaction, the unexercised Options then outstanding
                      under
                      the ISOP shall be assumed or substituted for an appropriate
                      number of
                      shares of each class of shares or other securities of the Successor
                      Company (or a parent of subsidiary of the Successor Company)
                      as were
                      distributed to the shareholders of the Company in connection
                      and with
                      respect to the Transaction. In the case of such assumption
                      and/or
                      substitution of Options, appropriate adjustments shall be made
                      to the
                      Purchase Price so as to reflect such action and all other terms
                      and
                      conditions of the Option Agreements shall remain unchanged,
                      including but
                      not limited to the vesting schedule, all subject to the determination
                      of
                      the Committee or the Board, which determination shall be in
                      their sole
                      discretion and final. The Company shall notify the Optionee
                      of the
                      Transaction in such form and method as it deems applicable
                      at least ten
                      (10) days prior to the effective date of such
                      Transaction.

                  


          

          


          
            	 	
                    9.2

                  	
                    Notwithstanding
                      the above and subject to any applicable law, the Board or the
                      Committee
                      shall have full power and authority to determine that in certain
                      Option
                      Agreements there shall be a clause instructing that, if in
                      any such
                      Transaction as described in section 9.1 above, the Successor
                      Company (or
                      parent or subsidiary of the Successor Company) does not agree
                      to assume or
                      substitute for the Options, the Vesting Dates shall be accelerated
                      so that
                      any unvested Option or any portion thereof shall be immediately
                      vested as
                      of the date which is ten (10) days prior to the effective date
                      of the
                      Transaction.

                  


          

          


          
            
              
              

            

            
              10

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    9.3

                  	
                    For
                      the purposes of section 9.1 above, an Option shall be considered
                      assumed
                      or substituted if, following the Transaction, the Option confers
                      the right
                      to purchase or receive, of reach Share underlying an Option
                      immediately
                      prior to the Transaction, the consideration (whether shares,
                      options,
                      cash, or other securities or property) received in the Transaction
                      by
                      holders of shares held on the effective date of the Transaction
                      (and if
                      such holders were offered a choice of consideration, the type
                      of
                      consideration chosen by the holders of a majority of the outstanding
                      shares); provided, however, that if such consideration received
                      in the
                      Transaction is not solely ordinary shares (or their equivalent)
                      of the
                      Successor Company or its parent or subsidiary, the Committee
                      may, with the
                      consent of the Successor Company, provide for the consideration
                      to be
                      received upon the exercise of the Option to be solely ordinary
                      shares (or
                      their equivalent) of the Successor Company or its parent or
                      subsidiary
                      equal in Fair Market Value to the per Share consideration received
                      by
                      holders of a majority of the outstanding shares in the Transaction;
                      and
                      provided further that the Committee may determine, in its discretion,
                      that
                      in lieu of such assumption or substitution of Options for options
                      of the
                      Successor Company or its parent or subsidiary, such options
                      will be
                      substituted for any other type of asset or property including
                      cash which
                      is fair under the circumstances.

                  


          

          


          
            	
                  	
                    9.4

                  	
                    If
                      the Company is voluntarily liquidated or dissolved while unexercised
                      Options remain outstanding under the ISOP, the Company shall
                      immediately
                      notify all unexercised Option holders of such liquidation,
                      and the Option
                      holders shall then have ten (10) days to exercise any unexercised
                      Vested
                      Option held by them at that time, in accordance with the exercise
                      procedure set forth herein. Upon the expiration of such ten-days
                      period,
                      all remaining outstanding Options will terminate
                      immediately.

                  


          

          


          
            	
                  	
                    9.5

                  	
                    If
                      the outstanding shares of the Company shall at any time be
                      changed or
                      exchanged by declaration of a share dividend (bonus shares),
                      share split,
                      combination or exchange of shares, recapitalization, or any
                      other like
                      event by or of the Company, and as often as the same shall
                      occur, then the
                      number, class and kind of the Shares subject to the ISOP or
                      subject to any
                      Options therefore granted, and the Purchase Prices, shall be
                      appropriately
                      and equitably adjusted so as to maintain the proportionate
                      number of
                      Shares without changing the aggregate Purchase Price, provided,
                      however,
                      that no adjustment shall be made by reason of the distribution
                      of
                      subscription rights (rights offering) on outstanding shares.
                      Upon
                      happening of any of the foregoing, the class and aggregate
                      number of
                      Shares issuable pursuant to the ISOP (as set forth in Section
                      7 hereof),
                      in respect of which Options have not yet been exercised, shall
                      be
                      appropriately adjusted, all as will be determined by the Board
                      whose
                      determination shall be final.

                  


          

          


          
            	
                  	
                    9.6

                  	
                    Anything
                      herein to the contrary notwithstanding, if prior to the completion
                      of the
                      IPO all or substantially all of the shares of the Company are
                      to be sold,
                      or in case of a Transaction, all or substantially all of the
                      shares of the
                      Company are to be exchanged for securities of another Company,
                      then each
                      Optionee shall be obliged to sell or exchange, as the case
                      may be, any
                      Shares such Optionee purchased under the ISOP, in accordance
                      with the
                      instructions issued by the Board in connection with the Transaction,
                      whose
                      determination shall be final.

                  


          

          


          
            
              
              

            

            
              11

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    9.7

                  	
                    The
                      Optionee acknowledges that in the event that the Company’s shares shall be
                      registered for trading in any public market, Optionee’s rights to sell the
                      Shares may be subject to certain limitations (including a lock-up
                      period),
                      as will be requested by the Company or its underwriters, and
                      the Optionee
                      unconditionally agrees and accepts any such
                      limitations.

                  


          

          


          
            	
                  	
                    9.8

                  	
                    Without
                      derogating from the provisions of section 20 below, it is herby
                      clarified
                      that any tax consequences arising from the exercise of the
                      provisions of
                      this section 9 shall be borne solely by the
                      Optionee.

                  


          

          


          
            	10.	
                    TERM
                      AND EXERCISE OF OPTIONS

                  


          

          


          
            	
                  	
                    10.1

                  	
                    Options
                      shall be exercised by the Optionee by giving written notice
                      to the Company
                      and/or to any third party designated by the Company (the “Representative”),
                      in such form and method as may be determined by the Company
                      and when
                      applicable, by the Trustee in accordance with the requirements
                      of Section
                      102, which exercise shall be effective upon receipt of such
                      notice by the
                      Company and/or the Representative and the payment of the Purchase
                      Price at
                      the Company’s or the Representative’s principal office. The notice shall
                      specify the number of Shares with respect to which the Option
                      is being
                      exercised.

                  


          

          


          
            	
                  	
                    10.2

                  	
                    Options,
                      to the extent not previously exercised, shall terminate forthwith
                      upon the
                      earlier of: (i) the date set forth in the Option Agreement;
                      and (ii) the
                      expiration of any extended period in any of the events set
                      forth in
                      section 10.5 below.

                  


          

          


          
            	
                  	
                    10.3

                  	
                    The
                      Options may be exercised by the Optionee in whole at any time
                      or in part
                      from time to time, to the extent that the Options become vested
                      and
                      exercisable, prior to the Expiration Date, and provided that,
                      subject to
                      the provisions of section 10.5 below, the Optionee is employed
                      by or
                      providing services to the Company or any of its Affiliates,
                      at all times
                      during the period beginning with the granting of the Option
                      and ending
                      upon the date of exercise.

                  


          

          


          
            	
                  	
                    10.4

                  	
                    In
                      the event of termination of employment or service, the unvested
                      portion of
                      the Optionee’s Option shall not vest and shall not become exercisable. A
                      notice of termination of employment or service shall be deemed
                      to
                      constitute termination of employment of service. In the event
                      of
                      termination of employment or service Vested Options granted
                      to such
                      Optionee shall expire unless extended pursuant to the provisions
                      of
                      section 10.5 below.

                  


          

          


          
            
              
              

            

            
              12

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    10.5

                  	
                    Notwithstanding
                      anything to the contrary hereinabove and unless otherwise determined
                      in
                      the Optionee’s Option Agreement, an Option may be exercised after the date
                      of termination of Optionee’s employment or service with the Company or any
                      Affiliates during an additional period of time beyond the date
                      of such
                      termination, but only with respect to the number of Vested
                      Options at the
                      time of such termination according to the Vesting Dates,
                      if:

                  


          

          


          
            	 	
                    (i)

                  	
                    termination
                      is without Cause, in which event any Vested Option still in
                      force and
                      unexpired may be exercised within a period of ninety (90) days
                      after the
                      date of such termination; or-

                  


          

          


          
            	 	
                    (ii)

                  	
                    termination
                      is the result of death or disability of the Optionee, in which
                      event any
                      Vested Option still in force and unexpired may be exercised
                      within a
                      period of twelve (12) months after the date of such termination;
                      or
                      -

                  


          

          


          
            	 	
                    (iii)

                  	
                    at
                      any time, the Committee shall authorize an extension of the
                      terms of all
                      or part of the Vested Options beyond the date of such termination
                      for a
                      period not to exceed the period during which the Options by
                      their terms
                      would otherwise have been
                      exercisable.

                  


          

          


          For
            avoidance of any doubt, if termination of employment or service is for
            Cause,
            any outstanding unexercised Option (whether vested or non-vested), will
            immediately expire and terminate, and the Optionee shall not have any
            right in
            connection to such outstanding Options.

          


          
            	
                  	
                    10.6

                  	
                    In
                      the event of termination of employment or service of an Optionee
                      of
                      Unapproved 102 Option, than such Optionee shall be required,
                      as a
                      condition to his right to exercise the option granted to him,
                      to extend to
                      the Company and/or its Affiliate a security or guarantee for
                      the payment
                      of tax due at the time of sale of Shares, all in accordance
                      with the
                      provisions of Section 102 and the rules, regulation or orders
                      promulgated
                      thereunder.

                  


          

          


          
            	
                  	
                    10.7

                  	
                    The
                      Optionees shall not have any of the rights or privileges of
                      shareholders
                      of the Company in respect of any Shares purchasable upon the
                      exercise of
                      any Option, nor shall they be deemed to be a class of shareholders
                      or
                      creditors of the Company for purpose of the operation of sections
                      350 and
                      351 of the Companies Law or any successor to such section,
                      until
                      registration of the Optionee as holder of such Shares in the
                      Company’s
                      register of shareholders upon exercise of the Option in accordance
                      with
                      the provisions of the ISOP, but in case of Options and Shares
                      held by the
                      Trustee, subject to the provisions of Section 6 of the
                      ISOP.

                  


          

          


          
            	
                  	
                    10.8

                  	
                    Any
                      form of Option Agreement authorized by the ISOP may contain
                      such other
                      provisions as the Committee may, from time to time, deem
                      advisable.

                  


          

          


          
            
              
              

            

            
              13

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	11.	
                    VESTING
                      OF OPTIONS

                  


          

          


          
            	
                  	
                    11.1

                  	
                    Subject
                      to the provisions of the ISOP, each Option shall vest following
                      the
                      Vesting Dates and for the number of Shares as shall be provided
                      in the
                      Option Agreement. However, no Option shall be exercisable after
                      the
                      Expiration Date.

                  


          

          


          
            	
                  	
                    11.2

                  	
                    An
                      Option may be subject to such other terms and conditions on
                      the time or
                      times when it may be exercised, as the Committee may deem appropriate.
                      The
                      vesting provisions of individual Options may
                      vary.

                  


          

          


          
            	12.	
                    SHARES
                      SUBJECT TO RIGHT OF FIRST
                      REFUSAL

                  


          

          


          
            	
                  	
                    12.1

                  	
                    Notwithstanding
                      anything to the contrary in the Articles of Association of
                      the Company,
                      none of the Optionees shall have a right of first refusal in
                      relation with
                      any sale of shares in the Company.

                  


          

          


          
            	
                  	
                    12.2

                  	
                    Unless
                      otherwise determined by the Committee, until such time as the
                      Company
                      shall complete an IPO, an Optionee shall not have the right
                      to sell Shares
                      issued upon the exercise of an Option within six (6) months
                      and one day
                      from the date of exercise of such Option. Unless otherwise
                      determined by
                      the Committee, until such time as the Company shall complete
                      an IPO, the
                      sale of Shares issuable upon the exercise of an Option shall
                      be subject to
                      a right of first refusal on the part of the
                      Repurchaser(s).

                  


          

          


          Repurchaser(s)
            means (i) the Company, if permitted by applicable law, (ii) if the Company
            is
            not permitted by applicable law, then any affiliate of the Company designated
            by
            the Committee; or (iii) if no decision is reached by the Committee, then
            the
            Company’s existing shareholders (save, for avoidance of doubt, for other
            Optionees who already exercised their Options), pro rata in accordance
            with
            their shareholding. The Optionee shall give a notice of sale (hereinafter
            the
“Notice”)
            to the
            Company in order to offer the Shares to the Repurchaser(s).

          


          
            	
                  	
                    12.3

                  	
                    The
                      Notice shall specify the name of each proposed purchaser or
                      other
                      transferee (hereinafter the “Proposed
                      Transferee”),
                      the number of Shares offered fro sale (hereinafter the “Offered
                      Shares”),
                      the price per Share and the payment terms. The Repurchaser(s)
                      will be
                      entitled for thirty (30) days from the day of receipt of the
                      Notice
                      (hereinafter the “Notice
                      Period”),
                      to purchase all or part of the Offered Shares on a pro rata
                      basis based
                      upon their respective holdings in the
                      Company.

                  


          

          


          
            	
                  	
                    12.4

                  	
                    If
                      by the end of the Notice Period not all of the Offered Shares
                      have been
                      purchased by the Repurchaser(s), then any remaining Offered
                      Shares shall
                      be re-allocated among the accepting Repurchaser(s) (other than
                      those to be
                      disregarded as aforesaid), in the same manner specified in
                      sections 12.2
                      and 12.3 above.

                  


          

          


          If
            the
            acceptance by the Repurchaser(s), in the aggregate, are in respect of
            less than
            the number of Offered Shares, then the Optionee shall be entitled to
            sell such
            remaining Shares at any time during the ninety (90) days following the
            end of
            the Notice Period on terms
            not
            more favorable than those set out in the Notice, provided that the Proposed
            Transferee agrees in writing that the provisions of this section shall
            continue
            to apply to the Shares in the hands of such Proposed Transferee.

          


          
            
              
              

            

            
              14

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          Any
            sale
            of Shares issued under the ISOP by the Optionee that is not made in accordance
            with the ISOP or the Option Agreement shall be null and void.

          


          
            	13.	
                    DIVIDENDS

                  


          

          


          
            	
                  	
                    13.1

                  	
                    With
                      respect to all Shares (but excluding, for avoidance of any
                      doubt, any
                      unexercised Options) allocated or issued upon the exercise
                      of Options
                      purchased by the Optionee and held by the Optionee or by the
                      Trustee, as
                      the case may be, the Optionee shall be entitled to receive
                      dividends in
                      accordance with the quality of such Shares, subject to the
                      provisions of
                      the Company’s Articles of Association (and all amendments thereto) and
                      subject to any applicable taxation on distribution of
                      dividends.

                  


          

          


          
            	
                  	
                    13.2

                  	
                    During
                      the period in which Shares are held by the Trustee on behalf
                      of the
                      Optionee, the cash dividends paid with respect thereto shall
                      be paid
                      directly to the Optionee, after deduction of any tax imposed
                      on such cash
                      dividends.

                  


          

          


          
            	14.	
                    RESTRICTIONS
                      ON ASSIGNABILITY AND SALE OF
                      OPTIONS

                  


          

          


          
            	
                  	
                    14.1

                  	
                    No
                      Option or any right with respect thereto, purchasable hereunder,
                      whether
                      fully paid or not, shall be assignable, transferable or given
                      as
                      collateral or any right with respect to it given to any third
                      party
                      whatsoever, except as specifically allowed under the ISOP,
                      and during the
                      lifetime of the Optionee each and all of such Optionee’s rights to
                      purchase Shares hereunder shall be exercisable only by the
                      Optionee.

                  


          

          


          Any
            such
            action made directly or indirectly, for an immediate validation or for
            a future
            one, shall be void.

          


          
            	
                  	
                    14.2

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

                  


          

          


          
            	15.	
                    EFFECTIVE
                      DATE AND DURATION OF THE
                      ISOP

                  


          

          


          The
            ISOP
            shall be effective as of the day it was adopted by the Board and shall
            terminate
            at the end of ten (10) years from such day of adoption.

          


          
            
              
              

            

            
              15

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	16.	
                    AMENDMENTS
                      OR TERMINATION

                  


          

          


          The
            Board
            may at any time amend, alter, suspend or terminate the ISOP. No amendment,
            alteration, suspension or termination of the ISOP shall impair the rights
            of any
            Optionee, unless mutually agreed otherwise between the Optionee and the
            Company,
            which agreement must be in writing and signed by the Optionee and the
            Company.
            Termination of the ISOP shall not affect the Committee’s ability to exercise the
            powers granted to it hereunder with respect to Options granted under
            the ISOP
            prior to the date of such termination.

          


          
            	17.	
                    GOVERNMENT
                      REGULATIONS

                  


          

          


          The
            ISOP,
            and the granting and exercise of Options hereunder, and the obligation
            of the
            Company to sell and deliver Shares under such Options, shall be subject
            to all
            applicable laws, rules, and regulations, whether of the State of Israel
            or of
            the United States or any other State having jurisdiction over the Company
            and
            the Optionee, including the registration of the Shares under the United
            States
            Securities Act of 1933, and the Ordinance and to such approvals by any
            governmental agencies or national securities exchanges as may be required.
            Nothing hereinshall be deemed to require the Company to register the
            Shares
            under the securities laws of any jurisdiction.

          


          
            	18.	
                    CONTINUANCE
                      OF EMPLOYMENT OR HIRED
                      SERVICES

                  


          

          


          Neither
            the ISOP nor the Option Agreement with the Optionee shall impose any
            obligation
            on the Company or an Affiliate thereof, to continue any Optionee in its
            employ
            or service, and nothing in the ISOP or in any Option granted pursuant
            thereto
            shall confer upon any Optionee any right to continue in the employ or
            service of
            the Company or an Affiliate thereof or restrict the right of the Company
            or an
            Affiliate thereof to terminate such employment or service at any
            time.

          


          
            	19.	
                    GOVERNING
                      LAW & JURISDICTION

                  


          

          


          The
            ISOP
            shall be governed by and construed and enforced in accordance with the
            laws of
            the State of Israel applicable to contracts made and to be performed
            therein,
            without giving effect to the principles of conflict of laws. The competent
            courts of Tel-Aviv, Israel shall have sole jurisdiction in any matters
            pertaining to the ISOP.

          


          
            	20.	
                    TAX
                      CONSEQUENCES

                  


          

          


          
            	
                  	
                    20.1

                  	
                    Any
                      tax consequences arising from the grant or exercise of any
                      Option, from
                      the payment for Shares covered thereby or from any other event
                      or act (of
                      the Company and/or its Affiliates, the Trustee or the Optionee),
                      hereunder, shall be borne solely by the Optionee. The Company
                      and/or its
                      Affiliates and/or the Trustee shall withhold taxes according
                      to the
                      requirements under the applicable laws, rules, and regulations,
                      including
                      withholding taxes at source. Furthermore, the Optionee shall
                      agree to
                      indemnify the Company 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
                      Optionee.

                  


          

          


          
            
              
              

            

            
              16

              
                

              

            

            
              
                ISRAELI
                  SHARE OPTION PLAN

                
                  
                    

                  

                

              

            

          

          


          
            	
                  	
                    20.2

                  	
                    The
                      Company and/or, when applicable, the Trustee shall not be required
                      to
                      release any Share certificate to an Optionee until all required
                      payments
                      have been fully made.

                  


          

          


          
            	
                  	
                    20.3

                  	
                    To
                      the extent provided by the terms of an Option Agreement, the
                      Optionee may
                      satisfy any tax withholding obligation relating to the exercise
                      or
                      acquisition of Shares under an Option by any of the following
                      means (in
                      addition to the Company’s right to withhold from any compensation paid to
                      the Optionee by the Company) or by a combination of such means:
                      (i)
                      tendering a cash payment; (ii) subject to the Committee’s approval on the
                      payment date, authorizing the Company to withhold Shares from
                      the Shares
                      otherwise issuable to the Optionee as a result of the exercise
                      or
                      acquisition of Shares under the Option in an amount not to
                      exceed the
                      minimum amount of tax required to be withheld by law; or (iii)
                      subject to
                      Committee approval on the payment date, delivering to the Company
                      owned
                      and unencumbered Shares; provided that Shares acquired on exercise
                      of
                      Options have been held for at least 6 months from the date
                      of
                      exercise.

                  


          

          


          
            	21.	
                    NON-EXCLUSIVITY
                      OF THE ISOP

                  


          

          


          The
            adoption of the ISOP by the Board shall not be construed as amending,
            modifying
            or rescinding any previously approved incentive arrangements or as creating
            any
            limitations on the power of the Board to adopt such other incentive arrangements
            as it may deem desirable, including, without limitation, the granting
            of Options
            otherwise than under the ISOP, and such arrangements may be either applicable
            generally or only in specific cases.

          


          For
            the
            avoidance of doubt, prior grant of options to Optionees of the Company
            under
            their employment agreements, and not in the framework of any previous
            option
            plan, shall not be deemed an approved incentive arrangement for the purpose
            of
            this Section.

          


          
            	22.	
                    MULTIPLE
                      AGREEMENTS

                  


          

          


          The
            terms
            of each Option may differ from other Options granted under the ISOP at
            the same
            time, or at any other time. The Board may also grant more than one Option
            to a
            given Optionee during the term of the ISOP, either in addition to, or
            in
            substitution for, one or more Options previously granted to that
            Optionee.

        

         

        
          
            
            

          

          
            17

            
              

            

          

          
            
            

          

        

         

        INCREDIMAIL
          LTD.

         

        OPTION
          AGREEMENT

         

        Made
          as of the _____day of _______, 2003

         

        
          
            	
                    BETWEEN:

                  	 	
                    INCREDIMAIL
                      LTD.

                  
	 	 	
                    A
                      company incorporated in ________

                  
	 	 	
                    (hereinafter
                      the “Company”)

                  
	 	 	 
	 	 	
                    on
                      the one part

                  
	 	 	 
	
                    AND: 

                  	 	
                    Name
                      _________________

                  
	 	 	
                    I.D.
                      No._______________

                  
	 	 	
                    Address:______________

                  
	 	 	
                    (hereinafter
                      the “Optionee”)

                  
	 	 	 
	 	 	
                    on
                      the other part

                  


          

        

         

         

        
          
            	
                    WHEREAS

                  	
                    On
                      November 5th,
                      2003, the Company duly adopted and the Board approved the Company’s 2003
                      Israeli Share Option Plan, a copy of which is attached as Exhibit
                      A
                      hereto, forming an integral part hereof (the “ISOP”);
                      and 

                  
	 	 
	
                    WHEREAS

                  	
                    Pursuant
                      to the ISOP, the Company has decided to grant Options to purchase
                      Shares
                      of the Company to the Optionee, and the Optionee has agreed
                      to such grant,
                      subject to all the terms and conditions as set forth in the
                      ISOP and as
                      provided herein;

                  


          

        

        


         


        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            
               

            

          

        


        NOW,
          THEREFORE,
          it is
          agreed as follows:

         

        
          
            	
                    1.

                  	
                    Preamble
                      and Definitions

                  
	 	 
	 	
                    1.1

                  	
                    The
                      preamble to this agreement constitutes an integral part
                      hereof.

                  
	 	 	 
	 	
                    1.2

                  	
                    Unless
                      otherwise defined herein, capitalized terms used herein shall
                      have the
                      meaning ascribed to them in the ISOP.

                  
	 	 	 
	
                    2.
                      

                  	
                    Grant
                      of Options

                  
	 	 
	 	
                    2.1
                      

                  	
                    The
                      Company hereby grants to the Optionee the number of Options
                      as set forth
                      in Exhibit
                      B
                      hereto, each Option shall be exercisable for one Share, upon
                      payment of
                      the Purchase Price as set forth in Exhibit
                      B,
                      subject to the terms and the conditions as set forth in the
                      ISOP and as
                      provided herein.

                  
	 	 	 
	 	
                    2.2

                  	
                    The
                      Optionee is aware that the Company intends in the future to
                      issue
                      additional shares and to grant additional options to various
                      entities and
                      individuals, as the Company in its sole discretion shall
                      determine.

                  
	 	 	 
	
                    3.

                  	
                    Period
                      of Option and Conditions of Exercise

                  
	 	 
	 	
                    3.1

                  	
                    The
                      terms of this Option Agreement shall commence on the Date of
                      Grant and
                      terminate at the Expiration Date (as such terms as defined
                      in Exhibit
                      B),
                      or at the time at which the Option expires pursuant to the
                      terms of the
                      ISOP or pursuant to this Option Agreement. 

                  
	 	 	 
	 	
                    3.2

                  	
                    Options
                      may be exercised only to purchase whole Shares, and in no case
                      may a
                      fraction of a Share be purchased. If any fractional Share would
                      be
                      deliverable upon exercise, such fraction shall be rounded up
                      one-half or
                      less, or otherwise rounded down, to the nearest whole
                      number.

                  
	 	 	 
	
                    4.

                  	
                    Adjustments

                  
	 	 
	 	Notwithstanding
                    anything to the contrary in the ISOP and in addition thereto,
                    if in any
                    such Transaction as such term is defined in the ISOP, the Successor
                    Company (or parent or subsidiary of the Successor Company) does
                    not agree
                    to assume or substitute the Options, all unexercised Options
                    shall be
                    expired as of the date of the Transaction.
	 	 
	
                    5.

                  	
                    Vesting;
                      Period of Exercise

                  
	 	 
	 	Subject
                    to the provisions of the ISOP, Options shall vest and become
                    exercisable
                    according to the Vesting Dates set forth in
                    Exhibit B
                    hereto, provided that the Optionee is an Employee of or providing
                    services
                    to the Company and/or its Affiliates on the applicable Vesting
                    Date.
	 	 	 
	 	All
                    unexercised Options granted to the Optionee shall terminate and
                    shall no
                    longer be exercisable on the Expiration Date, as described in
                    Section 2.13
                    of the ISOP.
	 	 	 
	
                    6.

                  	
                    Exercise
                      of Options

                  
	 	 
	 	 	 
	 	
                    6.1

                  	
                    Options
                      may be exercised in accordance with the provisions of Section
                      10.1 of the
                      ISOP.

                  


          

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        
          
            	 	
                    6.2

                  	
                    In
                      order for the Company to issue Shares upon the exercise of
                      any of the
                      Options, the Optionee hereby agrees to sign any and all documents
                      required
                      by any applicable law and/or by the Company's Articles of
                      Association.

                  
	 	 	 
	 	
                    6.3

                  	
                    Pursuant
                      to Section 7.3 of the ISOP and, when applicable, subject to
                      the provisions
                      of Section 102, until the consummation of an IPO, any Shares
                      acquired upon
                      the exercise of Options shall be voted by an irrevocable proxy,
                      attached
                      as Exhibit
                      C hereto.

                  
	 	 	 
	 	
                    6.4

                  	
                    The
                      Company shall not be obligated to issue any Shares upon the
                      exercise of an
                      Option if such issuance, in the opinion of the Company, might
                      constitute a
                      violation by the Company of any provision of law.

                  
	 	 	 
	
                    7.

                  	
                    Restrictions
                      on Transfer of Options and Shares

                  
	 	 	 
	 	
                    7.1

                  	
                    The
                      transfer of Options and the transfer of Shares to be issued
                      upon exercise
                      of the Options shall be subject to the limitations set forth
                      in the ISOP
                      and in the Company’s Articles of Association and any shareholders’
                      agreement to which the holders of ordinary shares of the Company
                      are
                      bound.

                  
	 	 	 
	 	
                    7.2

                  	
                    With
                      respect to any Approved 102 Option, subject to the provisions
                      of Section
                      102 and any rules or regulation or orders or procedures promulgated
                      thereunder, an Optionee shall not be entitled to sell or release
                      from
                      trust any Share received upon the exercise of an Approved 102
                      Option
                      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.

                  
	 	 	 
	 	
                    7.3

                  	
                    With
                      respect to Unapproved 102 Option, if the Optionee ceases to
                      be employed by
                      the Company or any Affiliate, the Optionee shall extend to
                      the Company
                      and/or its Affiliate a security or guarantee for the payment
                      of tax due at
                      the time of sale of Shares, all in accordance with the provisions
                      of
                      Section 102 and the rules, regulation or orders promulgated
                      thereunder.

                  
	 	 	 
	 	
                    7.4

                  	
                    The
                      Optionee acknowledges that in the event Company's shares shall
                      be
                      registered for trading in any public market, the Optionee’s right to sell
                      Shares may be subject to limitations (including a lock-up period),
                      as will
                      be requested by the Company or its underwriters, and the Optionee
                      unconditionally agrees and accepts any such
                      limitations.

                  
	 	 	 
	 	 	
                    The
                      Optionee acknowledges that in order to enforce the above restriction,
                      the
                      Company may impose stop-transfer instructions with respect
                      to the
                      exercised Shares.

                  
	 	 	 
	 	
                    7.5

                  	
                    The
                      Optionee shall not dispose of any Shares in transactions which
                      violate, in
                      the opinion of the Company, any applicable laws, rules and
                      regulations.
                      

                  


          

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        
          
            	 	
                    7.6

                  	
                    The
                      Optionee agrees that the Company shall have the authority to
                      endorse upon
                      the certificate or certificates representing the Shares such
                      legends
                      referring to the foregoing restrictions, and any other applicable
                      restrictions as it may deem appropriate (which do not violate
                      the
                      Optionee's rights according to this Option Agreement).

                  
	 	 	 
	
                    8.

                  	
                    Taxes;
                      Indemnification

                  
	 	 
	 	
                    8.1

                  	
                    Any
                      tax consequences arising from the grant or exercise of any
                      Option, from
                      the payment for Shares covered thereby or from any other event
                      or act (of
                      the Company and/or its Affiliates, the Trustee or the Optionee),
                      hereunder, shall be borne solely by the Optionee. The Company
                      and/or its
                      Affiliates and/or the Trustee shall withhold taxes according
                      to the
                      requirements under the applicable laws, rules, and regulations,
                      including
                      withholding taxes at source. Furthermore, the Optionee hereby
                      agrees to
                      indemnify the Company 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 Optionee.

                  
	 	 	 
	 	
                    8.2
                      

                  	
                    The
                      Optionee will not be entitled to receive from the Company and/or
                      the
                      Trustee any Shares allocated or issued upon the exercise of
                      Options prior
                      to the full payments of the Optionee’s tax liabilities arising from
                      Options which were granted to him and/or Shares issued upon
                      the exercise
                      of Options. For the avoidance of doubt, neither the Company
                      nor the
                      Trustee shall be required to release any share certificate
                      to the Optionee
                      until all payments required to be made by the Optionee have
                      been fully
                      satisfied. 

                  
	 	 	 
	 	
                    8.3

                  	
                    The
                      receipt of the Options and the acquisition of the Shares to
                      be issued upon
                      the exercise of the Options may result in tax consequences.
                      THE OPTIONEE
                      IS ADVISED TO CONSULT A TAX ADVISER WITH RESPECT TO THE TAX
                      CONSEQUENCES
                      OF RECEIVING OR EXERCISING THIS OPTION OR DISPOSING OF THE
                      SHARES.

                  
	 	 	 
	 	
                    8.4

                  	
                    With
                      respect to Approved 102 Options, the Optionee hereby acknowledges
                      that he
                      is familiar with the provisions of Section 102 and the regulations
                      and
                      rules promulgated thereunder, including without limitations
                      the type of
                      Option granted hereunder and the tax implications applicable
                      to such
                      grant. The Optionee accepts the provisions of the trust agreement
                      signed
                      between the Company and the Trustee, attached as Exhibit
                      D
                      hereto, and agrees to be bound by its terms. 

                  
	 	 	 
	
                    9.

                  	
                    Miscellaneous

                  
	 	 
	 	
                    9.1

                  	
                    No
                      Obligation to Exercise Options.
                      The grant and acceptance of these Options imposes no obligation
                      on the
                      Optionee to exercise it.

                  
	 	 	 
	 	
                    9.2

                  	
                    Confidentiality.
                      The Optionee shall regard the information in this Option Agreement
                      and its
                      exhibits attached hereto as confidential information and the
                      Optionee
                      shall not reveal its contents to anyone except when required
                      by law or for
                      the purpose of gaining legal or tax
                      advice.

                  


          

        

        
           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

         

        
          
            	 	
                    9.3

                  	
                    Continuation
                      of Employment or Service.
                      Neither the ISOP nor this Option Agreement shall impose any
                      obligation on
                      the Company or an Affiliate to continue the Optionee’s employment or
                      service and nothing in the ISOP or in this Option Agreement
                      shall confer
                      upon the Optionee any right to continue in the employ or service
                      of the
                      Company and/or an Affiliate or restrict the right of the Company
                      or an
                      Affiliate to terminate such employment or service at any
                      time.

                  
	 	 	 
	 	
                    9.4

                  	
                    Entire
                      Agreement.
                      Subject to the provisions of the ISOP, to which this Option
                      Agreement is
                      subject, this Option Agreement, together with the exhibits
                      hereto,
                      constitute the entire agreement between the Optionee and the
                      Company with
                      respect to Options granted hereunder, and supersedes all prior
                      agreements,
                      understandings and arrangements, oral or written, between the
                      Optionee and
                      the Company with respect to the subject matter hereof.

                  
	
                     

                  	 	 
	 	
                    9.5

                  	
                    Failure
                      to Enforce - Not a Waiver.
                      The failure of any party to enforce at any time any provisions
                      of this
                      Option Agreement or the ISOP shall in no way be construed to
                      be a waiver
                      of such provision or of any other provision hereof.

                  
	 	 	 
	 	
                    9.6

                  	
                    Provisions
                      of the ISOP.
                      The Options provided for herein are granted pursuant to the
                      ISOP and said
                      Options and this Option Agreement are in all respects governed
                      by the ISOP
                      and subject to all of the terms and provisions of the
                      ISOP.

                  
	 	 	 
	 	 	
                    Any
                      interpretation of this Option Agreement will be made in accordance
                      with
                      the ISOP but in the event there is any contradiction between
                      the
                      provisions of this Option Agreement and the ISOP, the provisions
                      of the
                      Option Agreement will prevail.

                  
	 	 	 
	 	
                    9.7

                  	
                    Binding
                      Effect.
                      The ISOP and this Option Agreement shall be binding upon the
                      heirs,
                      executors, administrators and successors of the parties
                      hereof.

                  
	 	 	 
	 	
                    9.8

                  	
                    Notices.
                      All notices or other communications given or made hereunder
                      shall be in
                      writing and shall be delivered or mailed by registered mail
                      or delivered
                      by email or facsimile with written confirmation of receipt
                      to the Optionee
                      and/or to the Company at the addresses shown on the letterhead
                      above, or
                      at such other place as the Company may designate by written
                      notice to the
                      Optionee. The Optionee is responsible for notifying the Company
                      in writing
                      of any change in the Optionee’s address, and the Company shall be deemed
                      to have complied with any obligation to provide the Optionee
                      with notice
                      by sending such notice to the address indicated
                      below.

                  


          

        

         

        Company’s
          Signature: 

         

        Name:
          ___________

         

        Position:___________

         

        Signature:
          ________________

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        


        I,
          the
          undersigned, hereby acknowledge receipt of a copy of the ISOP and accept
          the
          Options subject to all of the terms and provisions thereof. I have reviewed
          the
          ISOP and this Option Agreement in its entirety, have had an opportunity
          to
          obtain the advice of counsel prior to executing this Option Agreement,
          and fully
          understand all provisions of this Option Agreement. I agree to notify the
          Company upon any change in the residence address indicated above.

         

         

        

          
            	 	 	 	 	 
	 	
                    Date

                  	 	
                    Optionee’s
                      Signature

                  	 


          

        

         

        


         

        Exhibit
          A:    Incredimail
          Ltd. 2003 Israeli Share Option Plan

         

        Exhibit
          B:    Terms
          of the Option

         

        Exhibit
          C:    Proxy

        


        Exhibit
          D:    Trust
          Agreement


        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

            
               

            

          

        


         

        EXHIBIT
          B

         

        TERMS
          OF THE OPTION


         

        
          	
                  Name
                    of the Optionee:

                	 
	
                  Date
                    of Grant: 

                	 
	
                  Designation: 

                	
                  ·   Approved
                    102 Option:

                       
                    Capital Gain Option (CGO) ;or

                       
                    Ordinary Income Option (OIO) 

                  ·   Unapproved
                    102 Option

                  ·   3(i)
                    Option

                
	
                  1.    Number
                    of Options granted:

                	 
	 	 
	
                  2.    Purchase
                    Price: 

                	 
	 	 
	
                  3.    Vesting
                    Dates:

                	 


        

         

        


         

        
          
            	
                    Number
                      of Options

                  	
                    Vesting
                      Date

                  
	 	 
	 	 
	 	 
	 	 


          

           

          
            	
                    4.    Expiration
                      Date:

                  	 


          

        

         

        


         

        
 

         

        
          	 	 	 	 
	
                   

                  Optionee

                   

                	 	
                   

                  Company

                   

                	 


        

        
 

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
          C

         

        PROXY


         

        The
          undersigned, as record holder of securities of Incredimail
          Ltd.
          described below, hereby irrevocably appoints Yaron Adler and/or Opher Adler,
          each individually, as my proxy to attend all shareholders’ meetings and to vote,
          execute consents, and otherwise represent me with respect to exercised
          shares
          (i.e. options exercised into shares pursuant to the Incredimail
          Ltd.
          2003
          Israeli Share Option Plan) in the same manner and with the same effect
          as if the
          undersigned were personally present at any such meeting or voting such
          securities or personally acting on any matters submitted to shareholders
          for
          approval or consent.

        


        This
          proxy is made pursuant the Incredimail
          Ltd.
          2003
          Israeli Share Option Plan dated ______.

        


        The
          Shares shall be voted by the proxy holder in the same proportion as the
          votes of
          the other shareholders of the Company.

        


        This
          proxy is irrevocable as it may effect rights of third parties.

        


        The
          irrevocable proxy will remain in full force and effect until the consummation
          of
          an IPO, upon which it will terminate automatically.

        


        This
          proxy shall be signed exactly as the shareholder’s name appears on his share
          certificate. Joint shareholders must each sign this proxy. If signed by
          an
          attorney in fact, the Power of Attorney must be attached.

         

         

        
          	 	 	 
	
                  NAME

                	 	
                  DATE

                   

                
	 	 	 
	 	 	 
	 	 	 
	 	
                  SIGNATURE