EXHIBIT 4.3**ASSOCIATE STOCK OPTION PLAN 2005**1.0 INTRODUCTION:1.1 Sify has formulated a series of Associate Stock Option Plans (ASOP) to incentivise and rewardassociates for contributing to the growth of Sify.1.2 ASOP 2005 is the latest in the series of these ASOPs. The members of the Company approved theallocation of a further 1,900,000 shares on 25 October 2005 for issue as stock options toassociates.2.0 SCHEME OVERVIEW:2.1 Under ASOP 2005, Sify’s Associates (full time or part time employees of the Company itssubsidiaries and non-promoter directors) would be granted options for a fee which would give themthe right to buy Sify’s ADRs (listed in the Nasdaq National Market in USA) or Sify’s equity sharesas indicated in the letter of grant to them at an exercise price. The difference between the marketprice of these ADRs or Equity shares and the exercise price would be the gain to the Associate. Theoptions are exercisable after a vesting date but before the expiry date. Vesting is slated tohappen over a three-year period. Expiry occurs at the end of the fortieth month from the date ofgrant or one month after the associate ceases to be in the employment of Sify or its subsidiaries,whichever is earlier.2.2 As the market price of Sify’s ADRs (or Equity shares) goes up, the benefit to the Associategoes up. The Associate is incentivised to:2.2.1 Stay with Sify until vesting and after vesting until theoption value grows to an attractive level2.2.2 Work (with a high degree of goal congruence) in the interestof Sify shareholder in building a sustainable value and growthmomentum into Sify’s ADRs and equity shares.3.0 ADMINISTRATION:3.1 Shareholders of Sify have approved the allocation of 1,900,000 shares to be made available forASOP schemes on 25 October 2005. Shareholders have also empowered the Board of Directors toformulate ASOP schemes from time to time to grant stock options and when exercised issueADRs/Equity shares. Shareholders have also recognized that these stock options would apply toPrincipal Officers including the Chief Executive Officer, the Chief Operating Officer and the ChiefFinancial Officer and Directors.3.2 The Board of Directors (Sify Board) have constituted the Compensation Committee (currently madeup of three directors nominated by Sify Board) to formulate ASOP schemes, formulate policies foradministration of the schemes, and actually administer the scheme by granting options, recognizeexercises, issue ADRs and shares on exercise, collect exercise price and where necessary facilitatesale.3.3 The Compensation committee of the Board of Directors (Compensation Committee) administers theASOP schemes of Sify. ASOP 2005 will also be administered by the Compensation Committee.
 

 
3.4 In all issues to be decided by the Company relating to ASOP, the decision by the CompensationCommittee represents decision by the Company and is final.4.0 ADRS/SHARES:4.1 ASOP 2005 aims to grant options to buy either of the following to Associates:4.1.1 American Depository Shares/Receipts of Sify (listed inthe Nasdaq National Market of USA under the ticker“SIFY”) or4.1.2 Equity shares of Sify (currently not yet listed anywherein India)4.2 The Option letter (granting the option) would explicitly state what is being granted. In theabsence of such a clarification, ADRs shall be issued on exercise.4.3 Compensation Committee has the power to grant options for a quantity of ADRs/Shares notexceeding the unused quantity available in the pool for granting of options (as approved by andadded to by members of Sify in a general meeting).4.4 In the event of a stock split or a ratio change (between ADRs and equity shares), the quantityof stock options and the exercise price shall be adjusted for the effect of the stock split or theratio change so that the Associate gets the same proportion of shareholding percentage for the sameprice per percentage as the Associate would have prior to the stock split or ratio change.5.0 ELIGIBILITY TO PARTICIPATE:5.1 Options could be granted under ASOP 2005 only to Associates. Associates are defined to includeonly the full time or part time employees of Sify and its subsidiaries. Associates includePrincipal officers and directors of Sify and its subsidiaries. However, an employee who is apromoter or belongs to the promoter group or a director who either by himself or through hisrelative or through any body corporate directly or indirectly holds more than 10% of theoutstanding equity of Sify shall not be eligible. Subsidiaries, for these purposes, includescompanies in which Sify has more than 50% of issued shares or more than 50% voting rights in theBoard governing such companies.5.2 The Compensation Committee shall select from among the Associates a list of associates forgrant of stock options. The Compensation Committee shall decide on the selection criteria whichshall include among other things the performance track record, performance potential of theAssociates. The Compensation committee is empowered to include Associates on any other criteria andis also empowered to not include any Associate without stating any reason. The decision by theCompensation Committee on the choice of Associates who shall be granted stock options is final.6.0 GRANT OF OPTIONS:6.1 The Compensation Committee shall decide on whether the grant is for ADRs or equity shares, theoption quantity (number of ADRs or equity shares to be granted), the exercise price payable (as perGovernment of India guidelines for ADR linked stock options), the vesting schedule and other termsand conditions of the grant.
 

 
6.2 The Compensation Committee shall issue to the selected Associates Option letters grantingoptions to Associates giving them the right to buy ADRs (or if so specified, equity shares)specifying the quantity of stock options issued and the exercise price, the vesting schedule andother terms and conditions. A copy of the ASOP 2005 scheme shall be attached to the Option letter.The Option letter should bear the sequential number of the Option letter, the name of the Associateand the reference of the Compensation committee meeting by which the option is being granted. TheCompensation Committee should collect an Option fee of Re.1 per ADR (or share), which shall beadjusted against the exercise price payable or refunded to Associates if the option is notexercised and the option expires.7.0 EXERCISE PRICE:7.1 Exercise price refers to the price at which the Associate could buy the ADR (or equity share).The currency by which exercise price is payable is normally Rupees unless otherwise so specified inthe Option letter. Exercise price is payable to the Company by a cheque made payable to SifyLimited.7.2 The Compensation Committee shall fix the exercise price for ADR options at a discount of notmore than 10% to the prevailing market price on the date of grant and for the Equity share optionon the basis of a valuation to be done by an independent professional at the time of grant.8.0 VESTING SCHEDULE:8.1 The stock options granted shall be exercised (converted into an ADR or equity share) only afterthe options vest.8.2 The options granted shall vest as below: One sixth of the option quantity:At the end of one year from the date of grant Five sixth of the option quantity: At the end of eachquarter during the second and third year from the date of the grant in eight equal installments.8.3 In any case the grants shall vest fully on the occurrence of permanent total disability or thedeath of the Associate.8.4 In the event of a rights issue or a bonus issue of the ADRs or equity shares, the Associateshall be given the choice to deem the stock options to have vested and exercise the options andsubscribe to the rights issue or get the bonus issue. If the Associate chooses to not deem thestock option to have vested, the vesting schedule shall remain as per the terms of the grant.However, the Associate would not be able to participate in the rights issue or be eligible for thebonus issue of ADRs or Equity shares.9.0 EXPIRY:9.1 Stock options issued to Associates can be exercised only after they vest and should beexercised before they expire.9.2 Options issued under ASOP 2005 expire at the end of the fortieth month from the date of grant,or one month after the Associate ceases to be in the employment of Sify or its subsidiaries,whichever is earlier.
 

 
9.3 If the options vested earlier than envisaged due to death or permanent total disability of theAssociate, the options shall expire within one month after such a vesting. The CompensationCommittee is empowered to extend the expiry date by not more than three months in the case of deathor permanent total disability of the Associate.9.4 Associates who do not wish to accept stock option grants shall notify Sify in writing. Anyoption recommended by the Compensation Committee to them would not be issued to them.9.5 Associates who do not wish to continue participating in the ASOP scheme after the grant isreceived shall notify the company in writing. The options granted would forfeit after the letter isreceived by Sify. Sify would repay the option fee of Re.1 per ADR if such a fee was collectedearlier.10.0 EXERCISE OF STOCK OPTION AND ISSUE OF ADRS/EQUITY SHARES:10.1 Associates can exercise stock options any time. However Associates can sell the ADRs or sharesso issued under the option only during the period when insider trading is permitted under the“Insider trading policy” of Sify.10.2 The Insider trading policy of Sify shall be as determined by the Board of Directors of Sifyfrom time to time and as administered by the Chief Financial Officer of Sify from time to time.Unless there are specific price sensitive information within the Company, insider trading istypically permitted during the period commencing from “two days after the press release announcingquarterly results” and ending with “the fifteenth day of the third month of each quarter”.10.3 If the Associate is not permitted by law to hold the stock (ADR or equity share) and isexpected to sell it within reasonable time, then exercise of the option itself will be permittedonly during the period when insider trading is permitted.10.4 Associates wishing to exercise their options should tender to Sify a copy of the option letterand a cheque made payable to Sify Limited for the exercise price indicating the brokerage accountto which ADRs or shares should be credited.10.5 Associates are entitled to exercise part of the option quantity that has vested and carryforward the remainder until the options expire and exercise such carried forward quantity any timebefore expiry subject to the foregoing clauses on the time window when insider trading ispermitted.10.6 The ADRs or equity shares issued to Associates after the exercise of the option shall be theirexclusive property free of all charges/liens. The ADRs or shares will not be subject to any lock inunless such a lock in is applicable by law or is applicable to all shareholders of that kind. TheADRs or equity shares so issued shall rank pari passu with existing ADRs or shareholders and shallbe entitled to pro rated dividend/benefits from the date of issue and shall enjoy rights/privilegesthat other shareholders enjoy in terms of voting rights etc.10.7 Sify shall facilitate the sale of the ADRs and shares issued to Associates. Conditionsrelating to insider trading apply for the timing of sale by Associates. The ADRs issued by Sify onexercise of option by Associates shall be registered and saleable in the Nasdaq market.
 

 
10.8 All taxes that apply to the exercise, sale or realization of proceeds from ADRs and equityshares accrue to the Associate.11.0 TRANSFER, MORTGAGE ETC11.1 Options granted to Associates are not transferable. Options granted toAssociates transmit to legal heirs on the death of the Associate. All rightsand obligations of the Associate under the scheme shall accrue to the legalheirs of the Associate in the event of death of theAssociate.11.2 Stock options granted under the ASOP scheme cannot be pledged,mortgaged, hypothecated or be subject in any way to a charge or a liengiving right to any party other than the Associate.12.0 OTHERS:12.1 This scheme shall not form part of any contract of employment between SIFYand the associate. The rights and obligations of any individual under thecontract of employment shall not be affected by his participation in thisscheme or any right which he may have to participate in it.12.2 Nothing in this scheme shall afford any associate any additional right(s)as to compensation or damages in consequence of the termination of such officeor employment for any reason.12.3 This scheme shall not confer any associate any legal or equitable rightagainst Sify either directly or indirectly or give rise to any cause of actionin law or equity against Sify.12.4 This scheme is subject to all applicable laws, rules, regulations,guidelines and to such approvals from any governmental agencies as may berequired. In case of any contradiction between the provisions of this Schemeand any provisions, rules, regulations, guidelines issued by any governmentalagencies, the provisions of law shall override the provisions of this scheme.12.5 The associates who are granted warrants ADS / Equity under the schemeshall comply with such requirements of law as may be necessary.12.6 Sify does not guarantee any return on the equity investment made byassociates as part of the scheme. Any loss due to fluctuations in the marketprice of the equity including the shortfall in the expectations or projectionsand the risks associated with the investment are that of the associate alone.