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                                                                   EXHIBIT 4.05


                         SERVICESOFT TECHNOLOGIES, INC.

                              AMENDED AND RESTATED

                             1994 STOCK OPTION PLAN



1. Purpose. The Servicesoft Technologies, Inc. Stock Option Plan (the "Plan") is
intended to provide a method whereby employees and other associated persons
(including officers and directors) of Servicesoft Technologies, Inc. (the
"Company") and its subsidiaries who are making, and are expected to continue
making, substantial contributions to the successful management and growth of the
Company and its subsidiaries may be offered an opportunity to acquire Common
Stock, par value $0.01 per share (the "Common Stock"), of the Company. The
intention is to increase the proprietary interest of those persons in the
Company and their incentive to remain in and advance in the service of the
Company and its subsidiaries and to attract and retain personnel of experience
and ability by granting such persons an opportunity to acquire a proprietary
interest in the Company. Accordingly, the Company may, from time to time, grant
to such employees as may be selected in the manner hereinafter provided,
incentive stock options ("Incentive Stock Options"), as defined in Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"), and nonstatutory
stock options ("Nonstatutory Stock Options") to purchase shares of Common Stock
of the Company on the terms and conditions hereinafter established. The
Incentive Stock Options and Nonstatutory Stock Options sometimes are referred to
herein individually as an "Option" and collectively as the "Options".

2. Administration. The Plan shall be administered by a Compensation Committee
(the "Committee") appointed by the Board of Directors of the Company. The
Committee shall consist of no fewer than three members who may also be members
of the Board of Directors of the Company and participate in the Plan. Should the
Company become subject to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Committee shall consist of not fewer than three
"disinterested persons", as that term is defined in subparagraph (d)(3) of Rule
16b-3 ("Rule 16b-3") under the Exchange Act. Members of the Committee then will
not be able to participate in the Plan or become members if one year prior to an
occurrence whereby the Company becomes subject to Rule 16b-3 they received an
option under any plan of the Company. Subject to the terms and conditions of the
Plan and relevant commitments of the Company, the Committee shall have full
authority in its discretion, from time to time, and at any time, to select the
persons to whom Options shall be granted, to determine the number of shares to
be covered by each option, the time at which the Option shall be granted, the
terms and conditions of Option Agreements (as hereinafter defined) and, except
as hereinafter provided, the option exercise price and the term during which the
Options may be exercised.

        The Board of Directors may at any time appoint or remove members of the
Committee and may fill vacancies, however caused, in the Committee. The
Committee shall select one of its members as its Chairman, and shall hold its
meetings at such times and places as it shall deem advisable. A majority of its
members shall constitute a quorum. All actions of the Committee shall be taken
by a majority of its members and can be taken by written consent in lieu of a
meeting. The Committee shall make such rules and regulations for the conduct of
its business as it shall deem advisable.

3. Interpretation and Amendment. The interpretation, construction or
determination of any provisions of the Plan by the Committee shall be final and
conclusive. No member of the Board of Directors or the Committee shall be liable
for any action or determination made in good faith with respect to the Plan.

        The Board of Directors may, at any time, amend, alter, suspend or
terminate the Plan; provided, however, that any such action shall not impair any
Options theretofore granted under the Plan, and provided further that no
amendment of the Plan may be effected with regard to the following actions
without the approval of the holders of at least the majority of the voting stock
of the Company: (i) the total number of shares of Common Stock that may be
purchased under the Plan shall not be increased (except as permitted by
Paragraph 11); (ii) the option period during



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which outstanding Options granted under the Plan may be exercised shall not be
extended; and (iii) the class of individuals eligible to receive options under
the Plan cannot be changed.

4. Participants. Incentive Stock Options may be granted under the Plan to all
employees of the Company and its subsidiaries (including employees who are also
directors or officers of the Company or its subsidiaries). The term "subsidiary"
shall mean "subsidiary corporation" as defined in Section 425 of the Code. No
Incentive Stock Option shall be granted to an employee who, at the time the
Incentive Stock Option is granted, owns stock possessing more than ten percent
(10%) of the total combined voting power of all classes of capital stock of the
Company or any subsidiary of the Company; provided, however, that an Incentive
Stock Option may be granted to such an employee if, at the time such Incentive
Stock Option is granted, the option exercise price is at least one hundred and
ten percent (110%) of the fair market value of the Common Stock subject to the
Incentive Stock Option, and such Incentive Stock Option is by its terms not
exercisable after the expiration of five (5) years from the date such Incentive
Stock Option is granted. Nonstatutory Stock Options may be granted to any person
who has provided services to the Company, as determined is appropriate by the
Committee.

        Subject to the preceding paragraph, receipt of stock options under any
other stock option plan maintained by the Company or any subsidiary shall not,
for that reason, preclude a person from receiving Options under the Plan.

5. Common Stock. The Common Stock which may be issued and sold pursuant to
Options granted under the Plan from time to time shall not exceed in the
aggregate 2,200,000 shares of the Common Stock of the Company. The number of
shares issuable under the Plan may be increased to allow for the reissuance or
disposition of shares that have been issued upon the exercise of options granted
under the Plan and reacquired by the Company. The shares of Common Stock
reissued and sold under the Plan may be the Company's authorized but unissued
shares, or shares held in the Company's treasury.

6. Terms and Conditions of Options. Options granted pursuant to the Plan shall
be in such form and on such terms as the Committee shall, from time to time,
approve, but subject, nevertheless, to the following terms and conditions:

        The Option shall state the total number of shares of Common Stock to
which it relates and no fractional shares of Common Stock shall be issued.

        The Option exercise price per share of Common Stock issuable upon the
exercise of an Incentive Stock Option shall be not less than one hundred percent
(100%) of the fair market value of the Common Stock covered by such Option at
the date such Option is granted, or, in the case of an employee who at the time
the Incentive Stock Option is granted owns stock possessing more than ten
percent (10%) of the total combined voting power of all classes of capital stock
of the Company or any subsidiary of the Company, the Option exercise price for
any Incentive Stock Option shall be not less than one hundred and ten percent
(110%) of the fair market value of the Common Stock covered by such Option.

        Notwithstanding any other provision of the Plan, the term of an Option
shall be for a period of not more than ten (10) years from the date such Option
is granted.

        An Option must be granted within ten (10) years of the earlier of the
date the Plan is adopted or the date this Plan is approved by the Company's
stockholders in accordance with Paragraph 22.

        No individual shall be given the opportunity under this Plan to exercise
Incentive Stock Options for the purchase of Common Shares valued (at the time of
grant of the Incentive Stock Options) in excess of $100,000, in any calendar
year, unless and to the extent that said Options shall have first become
exercisable in the preceding year. No Incentive Stock Option shall be granted
hereunder in such a manner as would cause the foregoing restrictions to be
violated.

7. Restrictions on Disposition and Obligation of Resale. Shares of Common Stock
acquired by an employee pursuant to the exercise of a Nonstatutory Stock Option
under the Plan shall not be sold, transferred, or otherwise



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disposed of and shall not be pledged or otherwise hypothecated, except as
provided in Section 12 and in this Section 7. (Any such sale, transfer or other
disposition, or any pledge or other hypothecation shall hereinafter be referred
to as a "disposition"). In the event of the termination of employment for any
reason except retirement with the consent of the Company or death, such shares
shall, except as provided below, be offered for resale to the Company at the
original exercise price of the Nonstatutory Stock Option the exercise of which
resulted in the subject shares. Shares as to which the restrictions against
disposition and the obligations of resale to the Company have lapsed in
accordance with the provisions set forth below shall be referred to as "free
shares". Shares as to which the restrictions against disposition and the
obligation of resale to the Company have not lapsed as provided below shall be
referred to as "restricted shares". Holders of restricted shares may vote their
shares at any meeting of holders of shares of Common Stock. The Committee may
provide for the issuance of restricted shares subject to this paragraph to a
Trustee in exchange for payment of par value only and direct said Trustee to
issue an appropriate proxy authorizing the Optionee to vote said restricted
shares.

        The restrictions against disposition and the obligation of resale to the
Company of shares acquired pursuant to the Plan shall lapse as the Board of
Directors or Committee shall determine, and such terms shall be incorporated
into and be made a part of the option Agreement between the Company and the
employee. Any provision for the lapse of the restrictions against disposition
and the obligation of resale shall apply with respect to shares subject to an
option and/or shares issued upon the exercise of any related stock appreciation
rights whether or not the Option has been exercised in whole or part on the date
of lapse.

        In the event of the termination of employment for any reason, shares
issued to the employee pursuant to the exercise of a Nonstatutory Stock Option
under the Plan, which shares have not as of the date of termination of
employment, become free shares as defined above, shall become subject to an
obligation of immediate resale to the Company. The obligation of resale in the
case of disability, termination of employment due to retirement with the consent
of the Company or death shall be terminated to the same extent as an unexercised
Option may be exercised under similar circumstances as set forth in Sections 9
and 11. Shares subject to such obligation of resale shall be delivered to the
Company within thirty (30) days following the termination of employment. Within
sixty (60) days following a timely delivery of such shares, the Company will
compensate the employee (at the original acquisition price) for such number of
shares as the Company elects to purchase and will return to the employee any
shares not so purchased. Nothing in this Paragraph 7 shall require the Company
to repurchase shares issued to employees under the Plan. In the event the
Company exercises its rights under this Plan, restricted shares that are not
delivered to the Company within thirty (30) days following the termination of
employment shall remain subject to the restrictions against disposition, and
such restrictions shall not lapse as otherwise provided in this Paragraph 7 and
in the employee's Option Agreement.

        Notwithstanding any of the foregoing restrictions, any restricted shares
acquired under the Plan may at any time be pledged or otherwise hypothecated to
secure borrowing by the employee to obtain the acquisition price to be paid by
the employee for such shares, provided, however, that the amount of such
borrowing may not exceed the acquisition price of such shares.

        The provisions of this Paragraph 7 and the provisions of any Option
Agreement between the Company and an employee relating to the restrictions
against disposition and the obligation of resale to the Company shall be applied
according to their terms or according to such other terms and conditions, or at
such other times and dates, as the Board of Directors or the Committee may from
time to time establish.

8. Stock Appreciation Rights.

        A "stock appreciation right" is the right of an Optionee, without
payment to the Company (except for applicable withholding taxes), to receive the
excess of the Fair Market Value per share on the date on which a stock
appreciation right is exercised over the option price per share as provided in
the related underlying Option. A stock appreciation right shall pertain to, and
be granted only in conjunction with, a related underlying Option granted under
this Plan and shall be exercisable and exercised only to the extent that the
related option is exercisable. The number of shares of Common Stock subject to
the stock appreciation right shall be all or part of the shares subject to the
related Option, as determined by the Committee. The stock appreciation right
shall either become all or partially non-exercisable and shall be all or
partially forfeited if the exercisable portion, or any part thereof, of the
related option is exercised and vice versa.



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        At the discretion of the Committee, any Option granted under this Plan
may, at the time of such grant, include a stock appreciation right. The
Committee may impose conditions upon the grant or exercise of the stock
appreciation right which conditions may include a condition that the stock
appreciation right may only be exercised in accordance with the rules and
regulations adopted by the Committee from time to time. Such rules and
regulations may govern the right to exercise the stock appreciation right
granted prior to the adoption or amendment of such rules and regulations as well
as stock appreciation rights granted thereafter.

        Subject to any restrictions or conditions imposed by the Committee, a
stock appreciation right may be exercised by the Optionee as to a number of
shares of Common Stock under its related Option only upon the surrender of a
like number of shares of Common Stock available to the exercisable portion of
the related Option. Upon the exercise of a stock appreciation right and the
surrender of the exercisable portion of the related Option, the Optionee shall
be awarded cash, shares of Common Stock or a combination of shares and cash at
the discretion of the Committee. The award shall have a total value equal to the
product obtained by multiplying (1) the excess of the Fair Market Value per
share on the date on which the stock appreciation right is exercised over the
option price per share by (2) the number of shares subject to the exercisable
portion of the related Option so surrendered. The Committee may from time to
time, determine a limit as to the payment of the share value of a stock
appreciation right. In the event loans by the Company to the Optionee are
outstanding at the time of termination of his employment, the limit shall be no
less than the then-outstanding loan amount as specified in Paragraph 8(a).

        The portion of the stock appreciation right which may be awarded in cash
shall be determined by the Committee from time to time. Cash awards will be
subject to the disposition limitations specified in Paragraph 7 hereof The
number of shares awardable to an Optionee with respect to the noncash portion of
a stock appreciation right shall be determined by dividing such noncash portion
by the Fair Market Value per share on the exercisable date. No fractional shares
shall be issued.

9. Termination of Employment. Subject to the provision of Section 10, the Option
Agreement may provide that if the holder of an Option is an employee of the
Company or any subsidiary and ceases to be so employed for any reason, then any
options that are exercisable by him at the time he ceases to be employed by the
Company or its subsidiaries, and only to the extent such options are exercisable
as of such time, may be exercised by him only within ninety (90) days after the
date he ceases to be employed by the Company or its subsidiary. Notwithstanding
the foregoing, if the holder of an Option is an employee of the Company or any
subsidiary and ceases to be so employed as a result of his dismissal for cause
(as determined by the Board of Directors in its sole discretion or as otherwise
defined in an employment agreement with the Optionholder in effect at that
time), the Option Agreement may provide for the immediate termination of any
Options granted to such employee. The ninety (90) day limit referred to in this
paragraph may be extended on a case-by-case basis at the sole discretion of the
Committee.

        Solely for the purposes of the Plan, the transfer of an employee from
the employ of the Company to a subsidiary of the Company, or vice-versa, shall
not be deemed a termination of employment.

10. Termination as a result of Change of Control.

        In the event that an Optionholder who is an employee of the Company is
terminated by the Company upon or within the twelve month period following a
Change of Control, and such termination is not a dismissal for cause, fifty
percent (50%) of the remaining unvested portion of the total number of Options
held by such Option holder issued previously under this Plan shall vest
immediately upon such termination and become exercisable, while the remaining
Options shall be governed by the provisions of Section 9 of this Plan and the
terms of the Option Agreement; provided, however, that the Board of Directors of
the Company shall have the discretion to alter such arrangements with respect to
a Change of Control in the terms of any particular Option Agreement, and may in
particular provide for a different percentage of unvested Options to vest
immediately in the event of a Change of Control regardless of whether the
employment of the holder of such Options is subsequently terminated.

        In the event of a Change of Control, fifty percent (50%) of the
remaining unvested portion of the total number of Options held by each director
of the Company who is not an employee of the Company, issued previously under
this Plan shall vest immediately upon such Change of Control and become
exercisable, while the remaining Options shall be governed by the provisions of
Section 9 of this Plan and the terms of the Option Agreement; provided, however,
that the Board of Directors of the Company shall have the discretion to alter
such



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arrangements with respect to a Change of Control in the terms of any particular
Option Agreement, and may in particular provide for a different percentage of
unvested Options to vest immediately in the event of a Change of Control.

        For purposes of this Section 10, a "Change of Control" shall mean any of
the following events: (i) the dissolution or liquidation of the Company, (ii)
the sale of all or substantially all of the assets of the Company on a
consolidated basis to an unrelated person or entity, (iii) a merger,
reorganization or consolidation in which the holders of the Company's
outstanding voting power immediately prior to such transaction do not own a
majority of the outstanding voting power of the surviving or resulting entity
immediately upon completion of such transaction, (iv) the sale of all of the
stock of the Company to an unrelated person or entity or (v) any other
transaction (other than a public offering or private placement) in which the
owners of the Company's outstanding voting power prior to such transaction do
not own at least a majority of the outstanding voting power of the relevant
entity after the transaction, in each case, regardless of the form thereof.

11. Death. The Option Agreement may provide that if a holder of an Option shall
die while in the employ of the Company or any subsidiary of the Company, his
estate, personal representative or beneficiary shall have the right to exercise
any Options granted to the Optionholder pursuant to the Plan at any time within
two years from the date of his death (or within such shorter period as may be
specified by the Company in the Option Agreement), in respect of the total
number of shares as to which he would have been entitled to exercise an option
at the date of his death.

12. Stock Splits Mergers, etc. In case of any stock split, stock dividend or
similar transaction which increases or decreases the number of outstanding
shares of Common Stock, appropriate adjustment shall be made by the Board of
Directors, whose determination shall be final, to the number of shares of Common
Stock which may be purchased under the Plan and the number and option exercise
price per share of Common Stock which may be purchased under any outstanding
Options. In the case of a merger, sale of assets or similar transaction which
results in a replacement of the Company's Common Stock with stock of another
corporation, the Company will be required to replace any outstanding Options
granted under the Plan with comparable options to purchase the stock of such
other corporation. The Company may provide for immediate maturity of all
outstanding Options prior to the effectiveness of such merger, sale of assets or
similar transaction, with all Options not being exercised within the time period
specified by the Board of Directors being terminated.

13. Transferability. Options are not assignable or transferable, except by will
or the laws of descent and distribution to the extent set forth in Paragraph 11
and, during an Optionholder's lifetime, may be exercised only by him.

14. Exercise of Options. An Optionholder electing to exercise an option shall
give written notice to the Company of such election and of the number of shares
of Common Stock that he has elected to acquire and/or, as the case may be, the
number of shares of Common Stock as to which stock appreciation rights are being
claimed. A holder of Options shall have no rights of a stockholder with respect
to shares of Common Stock covered by the Option until after the date of issuance
of a stock certificate to him upon partial or complete exercise of his Option.

15. Written Option Agreement. Agreements granting Options under the Plan
("Option Agreements") shall be in writing, duly executed and delivered by or on
behalf of the Company and the Optionholder, and shall contain such terms and
conditions as the committee deems advisable. If there is any conflict between
the terms and conditions of any option Agreement and of the Plan, the terms and
conditions of the Plan shall control.

16. Payment. The Option exercise price shall be payable upon the exercise of the
Option in cash, by certified check or by the tender of shares of Common Stock
or, at the discretion of the Board of Directors, by paying in cash, at the
minimum, the par value of the shares of Common Stock being acquired and
executing a promissory note for the balance of the option exercise price,
provided that said note shall bear interest at a rate which is no less than the
lowest applicable U.S. federal rate required to be charged to preclude the
recharacterization of any amount of stated principal as interest for U.S.
federal tax purposes. If the shares of Common Stock are tendered as payment of
the option exercise price, the value of such shares shall be their fair market
value as of the date of exercise. If such



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tender would result in the issuance of fractional shares of Common Stock, the
Company shall instead return the difference in cash or by check to the employee.

17. Restrictions on Issuing Shares. The exercise of each Option shall be subject
to the condition that if at any time the Company shall determine in its
discretion that the satisfaction of withholding tax or other withholding
liabilities, or that the listing, registration, or qualification of any shares
otherwise deliverable upon such exercise upon any securities exchange or under
any state or federal law, or that the consent or approval of any regulatory
body, is necessary or desirable as a condition of, or in connection with, such
exercise in the delivery or purchase of shares pursuant thereto, then in any
such event, such exercise shall not be effective unless such withholding,
listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Company. The
Company shall use its best efforts to effect or secure the necessary
withholding, listing, registration, qualification, consent or approval so as to
effect the exercise of each Option and issue and deliver the shares purchased
thereunder.

18. Term of Plan. The Plan shall terminate ten (10) years after the Plan is
adopted by the Board of Directors, and no Option shall be granted pursuant to
the Plan after that date.

19. Application of Funds. The proceeds received by the Company from the sale of
Common Stock pursuant to the exercise of Options granted under the Plan will be
used for general corporate purposes.

20. Obligation to Exercise Option. The granting of an Option shall impose no
obligation on the Optionholder to exercise such option.

21. Continuance of Employment. Neither the Plan nor any Option Agreement shall
impose any obligation on the Company or on any subsidiary of the Company to
continue the employment of an Optionholder, and nothing in the Plan or in any
Option Agreement shall confer upon any Optionholder any right to continue in the
employ of the Company or the subsidiary of the Company or conflict with the
right of either to terminate such employment at any time.

22. Effectiveness of the Plan. The Plan shall become effective on the date of
its adoption by the Board of Directors, but subject, nevertheless, to (a)
approval, within twelve (12) months thereof, by the stockholders representing at
least a majority of the voting stock of the Company or by such greater
percentage as may from time to time be required under the laws of the State of
Delaware, and (b) such approvals as may be required by any other public
authorities. Options under this Plan may be granted but not exercised until it
is approved by the Company's shareholders. In the event the Plan is not
approved, the Plan shall terminate and all Options granted shall be void and
have no force or effect.

As amended and restated through July 7, 1999.




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                      NON-QUALIFIED STOCK OPTION AGREEMENT
                           UNDER THE SERVICESOFT, INC.
                        1994 STOCK OPTION AND GRANT PLAN



Name of Optionee:                  <<Name>>

No. of Option Shares:              <<Shares>> Shares of Common Stock

Grant Date:                        <<Grant_Date>>

Option Exercise Price/Share:       <<Exercise_Price>>


        Pursuant to the Servicesoft, Inc. Amended and Restated 1994 Stock Option
Plan (the "1994 Plan"), Servicesoft, Inc. a Delaware corporation (together with
all successors thereto, the "Company"), hereby grants to the person named above
(the "Optionee"), who is an officer, employee, director, consultant or other key
person of the Company or any of its subsidiaries, an option (the "Stock Option")
to purchase on or prior to the Expiration Date (as defined below), all or any
part of the number of shares of Common Stock, par value $.01 per share ("Common
Stock"), of the Company indicated above (the "Option Shares," and such shares
once issued shall be referred to as the "Issued Shares"), at the option exercise
price per share specified above (the "Option Exercise Price"), subject to the
terms and conditions set forth in this Non-Qualified Stock Option Agreement (the
"Agreement") and in the 1994 Plan. This Stock Option is not intended to qualify
as an "incentive stock option" as defined in Section 422(b) of the Internal
Revenue Code of 1986, as amended from time to time (the "Code"). All capitalized
terms used herein and not otherwise defined shall have the respective meanings
set forth in the 1994 Plan.

1. VESTING, EXERCISABILITY, AND TERMINATION.

        (a) No portion of this Stock Option may be exercised until such portion
shall have vested.

        (b) Except as set forth below and in Section 6, and subject to the
determination of the Compensation Committee of the Board of Directors of the
Company or the Board of Directors of the Company, as applicable (the
"Committee"), in its sole discretion to accelerate the vesting schedule
hereunder, this Stock Option shall be vested and exercisable with respect to the
Option Shares on the respective dates as follows: (i) 25% of the Option Shares
on the first anniversary of the Grant Date (as set forth above) and (ii) 2.08%
of the Option Shares on the monthly anniversary of the Grant Date thereafter.

        (c) Except as set forth in the 1994 Plan with regard termination as a
result of a Change of Control, in the event that the Optionee's employment or
other business relationship with the Company and its subsidiaries terminates for
any reason or under any circumstances, including the Optionee's resignation,
retirement or termination by the Company, upon the Optionee's death or
disability, or for any other reason, regardless of the circumstances thereof,
this Stock Option may thereafter be exercised, to the extent it was vested and
exercisable on such date of such termination, until the date specified in
Section 1(d) below. Any portion of the Stock Option that is not exercisable on
the date of termination of the Optionee's employment or other business
relationship with the Company shall immediately expire and be null and void.

        (d) Subject to the provisions of Section 6 below, once any portion of
this Stock Option becomes vested and exercisable, it shall continue to be
exercisable by the Optionee or his or her successors as contemplated herein at
any time or times prior to the earliest of (i) the date which is (A) 12 months
following the date on which the Optionee's employment or other business
relationship with the Company and its subsidiaries terminates due to death or
disability (as defined in Section 422(c)(6) of the Code) or (B) 90 days
following the date on which the Optionee's employment or other business
relationship with the Company terminates if the termination is due to any other
reason, provided however, if the Optionee's employment or other business
relationship with the Company is terminated for cause, this Stock Option shall
terminate immediately upon the date of the Optionee's termination, or (ii) the
date ten (10) years from the Grant Date (the earliest to occur of such dates
being the "Expiration Date"). For purposes of this Agreement the Committee shall
have sole discretion to determine the



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reason for the termination of the Optionee's employment or other business
relationship with the Company or any subsidiary.

2. EXERCISE OF STOCK OPTION.

        (a) The Optionee may exercise this Stock Option only in the following
manner: Prior to the Expiration Date (subject to Section 6), the Optionee may
deliver a Stock Option exercise notice (an "Exercise Notice") in the form of
Appendix A hereto indicating his or her election to purchase some or all of the
Option Shares with respect to which this Stock Option has vested at the time of
such notice. Such notice shall specify the number of Option Shares to be
purchased. Payment of the purchase price may be made by one or more of the
following methods; provided, however, that the methods set forth in subsections
(ii) and (iii) below shall become available only after the closing of the
Initial Public Offering:

           (i) In cash by certified or bank check or other instrument acceptable
to the Committee; or

           (ii) In the form of shares of Stock that are not then subject to
restrictions under any Company plan and that have been held by the optionee free
of such restrictions for at least six months, if permitted by the Committee in
its discretion such surrendered shares shall be valued at fair market value on
the exercise date;

           (iii) By the optionee delivering to the Company a properly executed
exercise notice together with irrevocable instructions to a broker to promptly
deliver to the Company cash or a check payable and acceptable to the Company to
pay the purchase price; provided that in the event the optionee chooses to pay
the purchase price as so provided, the optionee and the broker shall comply with
such procedures and enter into such agreements of indemnity and other agreements
as the Committee shall prescribe as a condition of such payment procedure;

           (iv) By the optionee delivering to the Company a promissory note if
the Board has authorized the loan of funds to the optionee for the purpose of
enabling or assisting the optionee to effect the exercise of his Stock Option;
provided that at least so much of the exercise price as represents the par value
of the Stock shall be paid other than with a promissory note

           (b) Certificates for the Option Shares so purchased will be issued
and delivered to the Optionee upon compliance to the satisfaction of the
Committee with all requirements under applicable laws or regulations in
connection with such issuance. Until the Optionee shall have complied with the
requirements hereof and of the 1994 Plan, the Company shall be under no
obligation to issue the Option Shares subject to this Stock Option, and the
determination of the Committee as to such compliance shall be final and binding
on the Optionee. The Optionee shall not be deemed to be the holder of, or to
have any of the rights of a holder with respect to, any shares of stock subject
to this Stock Option unless and until this Stock Option shall have been
exercised pursuant to the terms hereof, the Company shall have issued and
delivered the Option Shares to the Optionee, and the Optionee's name shall have
been entered as a stockholder of record on the books of the Company. Thereupon,
the Optionee shall have full dividend and other ownership rights with respect to
such Issued Shares, subject to the terms of this Agreement.

           (c) Notwithstanding any other provision hereof or of the 1994 Plan,
no portion of this Stock Option shall be exercisable after the Expiration Date,
including such date as is contemplated by Section 6 hereof.

3. INCORPORATION OF 1994 PLAN. Notwithstanding anything herein to the contrary,
this Stock Option shall be subject to and governed by all the terms and
conditions of the 1994 Plan.

4. TRANSFERABILITY. This Agreement is personal to the Optionee and is not
transferable by the Optionee in any manner other than by will or by the laws of
descent and distribution. This Stock Option may be exercised during the
Optionee's lifetime only by the Optionee (or by the Optionee's guardian or
personal representative in the event of the Optionee's incapacity). The Optionee
may elect to designate a beneficiary by providing written notice of the name of
such beneficiary to the Company, and may revoke or change such designation at
any time by filing written notice of revocation or change with the Company; such
beneficiary may exercise the Optionee's Stock Option in the



                                      -9-
<PAGE>   9


event of the Optionee's death to the extent provided herein. If the Optionee
does not designate a beneficiary, or if the designated beneficiary predeceases
the Optionee, the executor of the Optionee may exercise this Stock Option to the
extent provided herein in the event of the Optionee's death.

5. ADJUSTMENT UPON CHANGES IN CAPITALIZATION. The shares of stock covered by
this Stock Option are shares of Common Stock of the Company. Subject to Section
6 hereof, if the shares of Common Stock as a whole are increased, decreased,
changed or converted into or exchanged for a different number or kind of shares
or securities of the Company or any successor entity (or a parent or subsidiary
thereof), whether through merger or consolidation, sale of all or substantially
all of the assets of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, combination of shares, exchange
of shares, change in corporate structure or the like, an appropriate and
proportionate adjustment shall be made in the number and kind of shares and in
the per share exercise price of shares subject to any unexercised portion of
this Stock Option. In the event of any such adjustment in this Stock Option, the
Optionee thereafter shall have the right, subject to Section 6, to purchase the
number of shares under this Stock Option at the per share price, as so adjusted,
which the Optionee could purchase at the total purchase price applicable to this
Stock Option immediately prior to such adjustment, all references herein to
Common Stock shall be deemed to refer to the security that is subject to
acquisition upon exercise of this Stock Option and all references to the Company
shall be deemed to refer to the issuer of such security. Adjustments under this
Section 5 shall be determined by the Committee, whose determination as to what
adjustment shall be made, and the extent thereof, shall be conclusive. No
fractional shares of Common Stock shall be issued under the 1994 Plan resulting
from any such adjustment, but the Company in its discretion may make a cash
payment in lieu of fractional shares.

6. EFFECT OF A CHANGE OF CONTROL. In the event of a Change of Control of the
Company, this Option shall be subject to termination, assumption, substitution,
adjustment and/or limitation as provided in Section 10 of the 1994 Plan.

7. WITHHOLDING TAXES. The Optionee shall, not later than the date as of which
the exercise of this Stock Option becomes a taxable event for federal income tax
purposes, pay to the Company or make arrangements satisfactory to the Committee
for payment of any federal, state and local taxes required by law to be withheld
on account of such taxable event. Subject to approval by the Committee, the
Optionee may elect to have the minimum withholding obligation satisfied, in
whole or in part, by authorizing the Company to withhold from shares of Common
Stock to be issued or transferring to the Company, a number of shares of Common
Stock-with an aggregate fair market value that would satisfy the withholding
amount due. The Optionee acknowledges and agrees that the Company or any
subsidiary of the Company has the right to deduct from payments of any kind
otherwise due to the Optionee, or from the Option Shares to be issued in respect
of an exercise of this Stock Option, any federal, state or local taxes of any
kind required by law to be withheld with respect to the issuance of Option
Shares to the Optionee.

8. COMPANY'S RIGHT OF FIRST REFUSAL.

           (a) Exercise of Right. If the Optionee desires to transfer all or any
part of the Issued Shares, to any person other than the Company (an "Offeror"),
the Optionee shall: (i) obtain in writing an irrevocable and unconditional bona
fide offer (the "Offer") for the purchase thereof from the Offeror; and (ii)
give written notice (the "Option Notice") to the Company setting forth the
Optionee's desire to transfer such shares, which Option Notice shall be
accompanied by a photocopy of the Offer and shall set forth the name and address
of the Offeror and the price and terms of the Offer. Upon receipt of the Option
Notice, the Company shall have an assignable option to purchase any or all of
such Issued Shares (the "Company Option Shares") specified in the Option Notice,
such option to be exercisable by giving, within 30 days after receipt of the
Option Notice, a written counternotice to the Optionee. If the Company elects to
purchase any or all of such Company Option Shares, it shall be obligated to
purchase, and the Optionee shall be obligated to sell to the Company, such
Company Option Shares at the price and terms indicated in the Offer within 30
days from the date of delivery by the Company of such counternotice.

           (b) Sale of Company Option Shares to Offeror. The Optionee may, for
60 days after the expiration of the 30-day option period as set forth in Section
8(a), sell to the Offeror, pursuant to the terms of the Offer, any or all of
such Company Option Shares not purchased or agreed to be purchased by the
Company or its




                                      -10-
<PAGE>   10


assignee. If any or all of such Company Option Shares are not sold pursuant to
an Offer within the time permitted above, the unsold Company Option Shares shall
remain subject to the terms of this Section 8.

           (c) Adjustments for Changes in Capital Structure. If there shall be
any change in the Common Stock of the Company through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split, combination or
exchange of shares, or the like, the restrictions contained in this Section 8
shall apply with equal force to additional and/or substitute securities, if any,
received by the Optionee in exchange for, or by virtue of his or her ownership
of, Issued Shares.

           (d) Failure to Deliver Option Shares. If the Optionee fails or
refuses to deliver on a timely basis duly endorsed certificates representing the
Company Option Shares to be sold to the Company or its assignee pursuant to this
Section 8, the Company shall have the right to deposit the purchase price for
such Company Option Shares in a special account with any bank or trust company,
giving notice of such deposit to the Optionee, whereupon such Company Option
Shares shall be deemed to have been purchased by the Company. All such monies
shall be held by the bank or trust company for the benefit of the Optionee. All
monies deposited with the bank or trust company but remaining unclaimed for two
years after the date of deposit shall be repaid by the bank or trust company to
the Company on demand, and the Optionee shall thereafter look only to the
Company for payment. The Company may place a legend on any certificate for
Issued Shares delivered to the Optionee reflecting the restrictions on transfer
provided in this Section 8.

           (e) Expiration of Company's Right of First Refusal. The first refusal
rights of the Company set forth above shall remain in effect until the closing
of an Initial Public Offering or such other event as a result of or following
which the Common Stock shall be publicly held.

9. LOCKUP PROVISION. The Optionee agrees, if requested by the Company and any
underwriter engaged by the Company, not to sell or otherwise transfer or dispose
of any securities of the Company (including, without limitation pursuant to Rule
144 under the Act) held by him or her for such period following the effective
date of any registration statement of the Company filed under the Act as the
Company or such underwriter shall specify reasonably and in good faith, not to
exceed 180 days in the case of the Company's Initial Public Offering or 90 days
in the case of any other public offering.

10. MISCELLANEOUS PROVISIONS.

        (a) Employment. This Option does not confer upon the Optionee any rights
with respect to employment or continuation of employment or other business
relationship with the Company, nor shall it interfere with any right of the
Company to terminate such employment or other business relationship at anytime.

        (b) Equitable Relief. The parties hereto agree and declare that legal
remedies may be inadequate to enforce the provisions of this Agreement and that
equitable relief, including specific performance and injunctive relief, may be
used to enforce the provisions of this Agreement.

        (c) Release. In consideration for the issuance of this Stock Option, the
Optionee hereby releases and forever discharges the Company, its employees,
directors and stockholders and their representatives and agents, from any and
all claims, demands, actions, agreements and promises whatsoever of every name,
nature and description, both in law and in equity, for shares of Common Stock or
options to purchase such shares or any other equity securities of the Company
other than the shares of Common Stock underlying this Stock Option. For purposes
of this Section 10, the term "Company" shall be deemed to include its
Subsidiaries.

        (d) Change and Modifications. This Agreement may not be orally changed,
modified or terminated, nor shall any oral waiver of any of its terms be
effective. This Agreement may be changed, modified or terminated only by an
agreement in writing signed by the Company and the Optionee.

        (e) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware (or the state of incorporation
of any successor corporation) without regard to conflict of law principles.




                                      -11-
<PAGE>   11


        (f) Headings. The headings are intended only for convenience in finding
the subject matter and do not constitute part of the text of this Agreement and
shall not be considered in the interpretation of this Agreement.

        (g) Saving Clause. If any provision(s) of this Agreement shall be
determined to be illegal or unenforceable, such determination shall in no manner
affect the legality or enforceability of any other provision hereof.

        (h) Notices. All notices, requests, consents and other communications
shall be in writing and be deemed given when delivered personally, by telex or
facsimile transmission or when received if mailed by first class registered or
certified mail, postage prepaid. Notices to the Company or the Optionee shall be
addressed as set forth underneath their -signatures below, or to such other
address or addresses as may have been furnished by such party in writing to the
other.

        (i) Benefit and Binding Effect. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto, their respective successors,
permitted assigns, and legal representatives. The Company has the right to
assign this Agreement, and such assignee shall become entitled to all the rights
of the Company hereunder to the extent of such assignment.

        (j) Counterparts. For the convenience of the parties and to facilitate
execution, this Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same document.

                            [SIGNATURE PAGE FOLLOWS]



                                      -12-
<PAGE>   12

The foregoing Agreement is hereby accepted and the terms and conditions thereof
hereby agreed to by the undersigned as of the date first above written.


                                        Servicesoft, Inc..



                                        By:
                                           ------------------------------------
                                           Name:
                                           Title:


                                        Address:
                                                Two Apple Hill Drive
                                                Natick, MA 01760

The foregoing Agreement is hereby accepted and the terms and conditions thereof
hereby agreed to by the undersigned as of the date first above written.


                                        OPTIONEE:




                                        ---------------------------------------
                                        <<Name>>

                                        Optionee's Address:


                                        ---------------------------------------
                                        ---------------------------------------
                                        ---------------------------------------

                                        DESIGNATED BENEFICIARY:


                                        ---------------------------------------
                                        Name:

                                        Beneficiary's Address:


                                        ---------------------------------------
                                        ---------------------------------------
                                        ---------------------------------------