Document:

exv4w2

 

Exhibit 4.2

MAVEN NETWORKS, INC.

2008 RESTRICTED STOCK UNIT PLAN

	1.	 	Purposes of the Plan. The purposes of this 2008 Restricted Stock Unit Plan are to attract
and retain the best available personnel for positions of substantial responsibility, to
provide additional incentive to Employees and certain Consultants of the Company and its
Subsidiaries and to promote the success of the Company’s business. To accomplish the
foregoing, the Plan provides that the Company may grant Restricted Stock Units (as hereinafter
defined) to Employees and Consultants of the Company and its Subsidiaries.
	 
	2.	 	Definitions. As used herein, the following definitions shall apply:

“Administrator” means the Board or any of its Committees appointed pursuant to Section 4 of the
Plan.

“Applicable Laws” means any legal requirements of all state, federal and, where applicable, foreign
laws, including without limitation securities laws and the Code, relating to the establishment and
administration of stock incentive plans such as the Plan.

“Award” means an award of Restricted Stock Units (as defined below).

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

“Code” means the Internal Revenue Code of 1986, as amended.

“Committee” means the Committee appointed by the Board of Directors in accordance with Section 4(a)
of the Plan.

“Common Stock” means the common stock of the Company.

“Company” means Maven Networks, Inc., a Delaware corporation or any successor thereto.

“Consultant” means any person, but not including a Non-Employee Director, who is engaged by the
Company, Parent or Subsidiary to render services and is compensated for such services.

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“Continuous Status as an Employee or Consultant” means the absence of any interruption or
termination of service as an Employee or Consultant. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of: (i) sick leave; (ii) military
leave; (iii) any other leave of absence approved by the Administrator, provided that such leave is
for a period of not more than ninety (90) days, unless reemployment upon the expiration of such
leave is guaranteed by contract or statute, or unless provided otherwise pursuant to Company policy
adopted from time to time; or (iv) in the case of transfers between locations of the Company or
between the Company, Parent and Subsidiaries or their respective successors. For purposes of this
Plan, a change in status from an Employee to a Consultant or from a Consultant to an Employee will
not constitute an interruption of Continuous Status as an Employee or Consultant. If an entity
ceases to be a Subsidiary, an interruption of Continuous Status as an Employee or Consultant shall
not be deemed to have occurred with respect to each Employee or Consultant in respect of such
Subsidiary who immediately becomes an Employee or Consultant of the Company, Parent or another
Subsidiary that does not cease to be a Subsidiary after giving effect to the transaction or other
event giving rise to the change in status.

“Director” means a member of the Board.

“Employee” means any person, including Officers and Directors, employed by the Company, Parent or
Subsidiary, with the status of employment determined based upon such minimum number of hours or
periods worked as shall be determined by the Administrator in its discretion, subject to any
requirements of the Code. The payment of a director’s fee by the Company to a Director shall not
be sufficient to constitute “employment” of the Director by the Company.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Fair Market Value” means, as of any date, the fair market value of Common Stock determined as
follows:

	 	(i)	 	If the Common Stock is listed on any Stock Exchange including without
limitation the Nasdaq Global Market and Nasdaq Global Select Market, its Fair Market
Value shall be the closing sales price for such stock as quoted on such Stock Exchange
on the date of determination (if for a given day no sales were reported, the closing
bid on that day shall be used), as such price is reported in The Wall Street Journal or
such other source as the Administrator deems reliable;
	 
	 	(ii)	 	If the Common Stock is listed on The Nasdaq Stock Market (but not on the Nasdaq
Global Market or Nasdaq Global Select Market thereof) or regularly quoted by a
recognized securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the bid and asked prices for the Common Stock on the date of
determination, as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or

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	 	(iii)	 	In the absence of an established market for the Common Stock, the Fair Market
Value thereof shall be determined in good faith by the Administrator in compliance with
any applicable legal, tax (including, without limitation, Section 409A of the Code) and
accounting requirements.

“Non-Employee Director” means a Director who is not an Employee.

“Officer” means an officer of the Company, Parent or Subsidiary.

“Parent” means a “parent corporation” of the Company, whether now or hereafter existing, as defined
in Section 424(e) of the Code, or any successor provision.

“Plan” means this 2008 Restricted Stock Unit Plan, as amended from time to time.

“Reporting Person” means an Officer, Director, or greater than ten percent stockholder of the
Company, Parent or Subsidiary within the meaning of Rule 16a-2 under the Exchange Act, who is
required to file reports pursuant to Rule 16a-3 under the Exchange Act.

“Restricted Stock Unit” means the right to receive in cash or Shares the Fair Market Value of a
Share granted pursuant to Section 8 of the Plan.

“Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act, as the same may be amended from
time to time, or any successor provision.

“Share” means a share of the Common Stock, as adjusted in accordance with Section 10 of the Plan.

“Stock Exchange” means any stock exchange or consolidated stock price reporting system on which
prices for the Common Stock are quoted at any given time.

“Subsidiary” means a “subsidiary corporation” of the Company (“Subsidiaries” meaning more than one
“subsidiary corporation”) whether now or hereafter existing, as defined in Section 424(f) of the
Code, or any successor provision.

	3.	 	Stock Subject to the Plan. The Shares may be authorized, but unissued, or reacquired Common
Stock. The maximum aggregate number of Shares that may be issued under the Plan is 6,500,000
Shares. The foregoing numerical limit is subject to adjustment as contemplated by Section 10.

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	4.	 	Administration of the Plan.

	 	(a)	 	The Administrator. The Plan shall be administered by and all Awards under the
Plan shall be authorized by the Administrator. The “Administrator” means the Board or
one or more committees appointed by the Board or another committee (within its
delegated authority) to administer all or certain aspects of the Plan. Any such
committee shall be comprised solely of one or more Directors or such number of
Directors as may be required under Applicable Law. A committee may delegate some or
all of its authority to another committee so constituted. The Board or a committee
comprised solely of Directors may also delegate, to the extent permitted by Section
157(c) of the Delaware General Corporation Law and any other Applicable Law, to one or
more Officers of the Company or Parent, its powers under the Plan (a) to designate the
Employees other than an Officer who is a Reporting Person who will receive grants of
Awards under the Plan, and (b) to determine the number of Shares subject to, and the
other terms and conditions of, such Awards. The Board may delegate different levels of
authority to different committees with administrative and grant authority under the
Plan. Unless otherwise provided in the Bylaws of the Company or the applicable charter
of any Administrator: (a) a majority of the members of the acting Administrator shall
constitute a quorum, and (b) the vote of a majority of the members present assuming the
presence of a quorum or the unanimous written consent of the members of the
Administrator shall constitute action by the acting Administrator.

With respect to awards intended to satisfy the requirements for performance based
compensation under Section 162(m) of the Code, the Plan shall be administered by a
committee consisting solely of two or more outside directors (as this requirement is
applied under Section 162(m) of the Code); provided, however, that the failure to
satisfy such requirement shall not affect the validity of the action of any other
committee otherwise duly authorized and acting in the matter. Award grants, and
transactions in or involving Awards, intended to be exempt under Rule 16b-3
promulgated under the Exchange Act, must be duly and timely authorized by the Board
or a committee consisting solely of two or more non-employee directors (as this
requirement is applied under Rule 16b-3 promulgated under the Exchange Act). To the
extent required by any applicable Stock Exchange, the Plan shall be administered by
a committee composed entirely of independent directors (within the meaning of the
applicable Stock Exchange rules).

	 	(b)	 	Powers of the Administrator. Subject to the provisions of the Plan and in the
case of a Committee, the specific duties delegated by the Board to such Committee, and
subject to the approval of any relevant authorities, including the approval, if
required, of any Stock Exchange, the Administrator shall have the authority, in its
discretion:

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	 	(i)	 	to determine the Fair Market Value of the Common Stock, in
accordance with the definition of such term set forth above;
	 
	 	(ii)	 	to select the Consultants and Employees to whom Awards may from
time to time be granted hereunder;
	 
	 	(iii)	 	to determine whether and to what extent Awards are granted
hereunder;
	 
	 	(iv)	 	to determine the number of Shares of Common Stock, if any, to
be covered by each Award granted hereunder;
	 
	 	(v)	 	to approve forms of agreements, not inconsistent with the terms
of the Plan, for use under the Plan;
	 
	 	(vi)	 	to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Award granted hereunder, including, but not
limited to, the Share price and any restriction or limitation, the vesting of
any Award or the acceleration of vesting or waiver of a forfeiture restriction,
based in each case on such factors as the Administrator shall determine, in its
sole discretion;
	 
	 	(vii)	 	to determine whether and under what circumstances an Award may
be settled in cash or other consideration instead of Common Stock;
	 
	 	(viii)	 	to adjust the number of Shares subject to any Award or change previously
imposed terms and conditions; in such circumstances as the Administrator may
deem appropriate, in each case subject to Sections 3 and 13;
	 
	 	(ix)	 	to construe and interpret the terms of the Plan and Awards
granted pursuant to the Plan; and
	 
	 	(x)	 	in order to fulfill the purposes of the Plan and without
amending the Plan, to modify Awards to participants who are foreign nationals
or employed outside of the United States in order to recognize differences in
applicable local law, tax policies or customs.

	 	(c)	 	Effect of Administrator’s Decision. All decisions, determinations and
interpretations of the Administrator shall be final and binding on all holders of any
Award.

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	5.	 	Eligibility.

	 	(a)	 	Recipients of Grants. Awards may be granted to eligible Employees and
Consultants. An Employee or Consultant who has been granted an Award may, if he or she
is otherwise eligible, be granted additional Awards.
	 
	 	(b)	 	No Employment Rights. The Plan shall not confer upon any Award recipient any
right with respect to continuation of employment or consulting relationship with the
Company, nor shall it interfere in any way with such recipient’s right or the Company’s
right to terminate his or her employment or consulting relationship at any time, with
or without cause.

	6.	 	Term of Plan. The Plan shall become effective upon the earlier to occur of its adoption by
the Board or its approval by the stockholders of the Company as described in Section
17 of the Plan. It shall continue in effect until the date that is ten years from the date
the plan becomes effective, unless sooner terminated under Section 13 of the Plan.

	7.	 	Term of Awards. The term of each Award shall be the term stated in the written agreement
evidencing such Award.
	 
	8.	 	Restricted Stock Units.

	 	(a)	 	General. Restricted Stock Units may be issued either alone, in addition to, or
in tandem with cash awards made outside of the Plan. After the Administrator
determines that it will grant Restricted Stock Units under the Plan, it shall advise
the recipient in writing of the terms, conditions and restrictions related to the offer
(which may include restrictions based on performance criteria, passage of time or other
factors or a combination thereof), and the number of Restricted Stock Units that such
person shall be entitled to receive. The offer shall be accepted by execution of a
Restricted Stock Units Award agreement in the form determined by the Administrator.
	 
	 	(b)	 	Rights as a Stockholder. A recipient who is awarded Restricted Stock Units
shall possess no incidents of ownership with respect to the Shares represented by such
Restricted Stock Units, unless and until the same are transferred to the recipient
pursuant to the terms of the Restricted Stock Unit.
	 
	 	(c)	 	Other Provisions. The Restricted Stock Units Award agreement shall contain
such other terms, provisions and conditions not inconsistent with the Plan as may be
determined by the Administrator in its sole discretion. In addition, the

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	 	 	 	provisions of
Restricted Stock Units Award agreements need not be the same with respect to each Award
or each recipient who is awarded Restricted Stock Units.

	9.	 	Tax Withholding. Upon any vesting or payment of an Award, the Company, Parent or Subsidiary
shall have the right at its option to:

	 	(a)	 	require the Award recipient (or the recipient’s personal representative or
beneficiary, as the case may be) to pay or provide for payment of the minimum amount of
any taxes which the Company, Parent or Subsidiary may be required to withhold with
respect to such vesting or payment; or
	 
	 	(b)	 	deduct from any amount otherwise payable in cash to the Award recipient (or the
recipient’s personal representative or beneficiary, as the case may be) the minimum
amount of any Award recipient’s taxes which the Company, Parent or Subsidiary may be
required to withhold with respect to such cash payment.

In any case where a tax is required to be withheld in connection with the delivery
of Shares under the Plan, the Administrator may in its sole discretion (subject to
Applicable Laws) grant (either at the time of the Award or thereafter) to the Award
recipient the right to elect, pursuant to such rules and subject to such conditions
as the Administrator may establish, to (i) have the Company reduce the number of
Shares to be delivered by (or otherwise reacquire from the recipient)
the appropriate number of Shares, valued in a consistent manner at their Fair Market
Value or at the sales price in accordance with authorized procedures for cashless
exercises, necessary to satisfy the minimum applicable withholding obligation on
vesting or payment, or (ii) surrender to the Company Shares which (A) in the case of
Shares initially acquired from the Company, have been owned by the Award recipient
for such period of time (if any) as may be required to avoid a charge to the
Company’s earnings, and (B) have a Fair Market Value equal to the minimum amount
required to be withheld. For these purposes, the Fair Market Value of the Shares to
be withheld or repurchased, as applicable, shall be determined on the date that the
amount of tax to be withheld is to be determined pursuant to the Code (the “Tax
Date”).

Any surrender by a Reporting Person of previously owned Shares to satisfy tax
withholding obligations incurred in connection with an Award granted under the Plan
must comply with the applicable provisions of Rule 16b-3.

All elections by an Award recipient to have Shares withheld to satisfy tax
withholding obligations shall be made in writing in a form acceptable to the
Administrator and shall be subject to the following restrictions: (i) the election
must be made on or prior to the applicable Tax Date; (ii) once made, the election

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shall be irrevocable as to the particular Shares for which the election is made; and
(iii) all elections shall be subject to the consent or disapproval of the
Administrator.

	10.	 	Adjustments Upon Changes in Capitalization, Corporate Transactions.

	 	(a)	 	Changes in Capitalization. Subject to any required action by the stockholders
of the Company, (i) the number and type of shares of Common Stock (or other securities)
covered by each outstanding Award, (ii) the number and type of shares of Common Stock
(or other securities) that have been authorized for issuance under the Plan but as to
which no Awards have yet been granted or that have been returned to the Plan upon
cancellation or expiration of an Award or otherwise and/or (iii) the maximum number of
shares of Common Stock for which Awards may be granted to any Employee or Consultant
under the Plan, shall be equitably and proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock split,
reverse stock split, stock dividend, combination, recapitalization or reclassification
of the Common Stock, or any other increase or decrease in the number of issued shares
of Common Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not be
deemed to have been “effected without receipt of consideration.” Such adjustment shall
be made by the Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the Company of shares
of stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock (or other securities) subject to an Award.

It is intended that, if possible, any adjustments contemplated by the preceding
paragraph be made in a manner that satisfies applicable legal, tax (including,
without limitation, Section 409A of the Code) and accounting (so as not to trigger
any charge to earnings with respect to such adjustment) requirements. Without
limiting the generality of the preceding sentence or of Section 4(c), any good faith
determination by the Administrator as to whether an adjustment is required pursuant
to this Section 10(a), and the extent and nature of any such adjustment, shall be
conclusive and binding on all persons.

	 	(b)	 	Corporate Transactions. In the event of the proposed dissolution or
liquidation of the Company, each Award will terminate immediately prior to the
consummation of such proposed action, unless otherwise provided by the Administrator.
Additionally, the Administrator may, in the exercise of its sole discretion in such
instances, declare that any Award shall terminate as of a date fixed by the
Administrator. In the event of a proposed sale of all or substantially all of the
assets of the Company, or the merger of the Company with or into another

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	 	 	 	corporation,
each Award shall be assumed or an equivalent Award shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation.

	11.	 	Non-transferability of Awards. An Award may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of descent or
distribution. Except as otherwise provided by the Administrator, an Award may only be
purchased during the lifetime of the recipient of the Award.

	12.	 	Time of Granting of an Award. The date of grant of an Award shall, for all purposes, be the
date on which the Administrator makes the determination granting such Award, or such other
later date as is determined by the Administrator in compliance with applicable legal, tax
(including, without limitation, Section 409A of the Code) and accounting requirements. Notice
of the grant determination shall be given to each Employee or Consultant to whom an Award is
so granted within a reasonable time after the date of such grant.
	 
	13.	 	Amendment and Termination of the Plan.

	 	(a)	 	Amendment and Termination. Subject to 13(c) below, the Board may amend, alter,
suspend, discontinue, or terminate the Plan or any portion thereof at any time;
provided, that no such amendment, alteration, suspension, discontinuation or
termination shall be made without stockholder approval if such approval is necessary to
comply with any tax, securities or regulatory law or requirement or any applicable
Stock Exchange requirement with which the Board intends the Plan to comply or if such
amendment constitutes a “material amendment.” For purposes of the Plan, a “material
amendment” shall mean an amendment that (i) materially increases the benefits accruing
to participants under the Plan, (ii) materially increases the number of securities that
may be issued under the Plan, (iii) materially modifies the requirements for
participation in the Plan, or (iv) is
otherwise deemed a material amendment by the Administrator pursuant to any
Applicable Law or applicable accounting or Stock Exchange rules.
	 
	 	(b)	 	Amendments to Awards. Without limiting any other express authority of the
Administrator under (but subject to) the express limits of the Plan, the Administrator
by agreement or resolution may waive conditions of or limitations on Awards that the
Administrator in the prior exercise of its discretion has imposed, without the consent
of the Award recipient, and (subject to the requirements of Section 13(c)) may make
other changes to the terms and conditions of Awards.

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	 	(c)	 	Limitations on Amendments to Plan and Awards. No amendment, suspension or
termination of the Plan or change of or affecting any outstanding Award shall, without
written consent of the Award recipient, affect in any manner substantially adverse to
such recipient any rights or benefits of such recipient or obligations of the Company
under any Award granted under the Plan prior to the effective date of such change.
Changes, settlements and other actions contemplated by Section 10 shall not be deemed
to constitute changes or amendments for purposes of this Section 13(c).

	14.	 	Compliance with Laws. The Plan, the granting and vesting of Awards under the Plan, the
offer, issuance and delivery of shares of Common Stock, and/or the payment of money under the
Plan or under Awards are subject to compliance with all applicable federal, state and, where
applicable, foreign laws, rules and regulations (including but not limited to state and
federal securities law and federal margin requirements) and to such approvals by any listing,
regulatory or governmental authority as may, in the opinion of counsel for the Company, be
necessary or advisable in connection therewith. The person acquiring any securities under the
Plan will, if requested by the Company, Parent or a Subsidiary, provide such assurances and
representations to the Company, Parent or Subsidiary as the Administrator may deem necessary
or desirable to assure compliance with all Applicable Law and accounting requirements.

	15.	 	Reservation of Shares. The Company, during the term of this Plan, will at all times reserve
and keep available such number of Shares as shall be sufficient to satisfy the requirements of
the Plan. The inability of the Company to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful
issuance and sale of any Shares hereunder and which Company has made a commercially reasonable
effort to obtain, shall relieve the Company of any liability in respect of the failure to
issue or sell such Shares as to which such requisite authority shall not have been obtained.

	16.	 	Agreements. Awards shall be evidenced by written agreements in such form as the
Administrator shall approve from time to time and which shall not be inconsistent with the
terms of this Plan.

	17.	 	Stockholder Approval. Continuance of the Plan shall be subject to approval by the
stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such stockholder approval shall be obtained in the manner and to the degree
required under applicable federal and state law and the rules of any stock exchange upon
which the Shares are listed.

	18.	 	Unfunded Status of Plan. The Plan is intended to constitute an “unfunded” plan for incentive
compensation. With respect to any payments not yet made to a participant by

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	 	 	the Company,
nothing contained herein shall give any such participant any rights that are greater than
those of a general creditor of the Company.

	19.	 	Governing Law. The Plan and all determinations made and actions taken pursuant hereto shall
be governed by the laws of the State of Delaware, without giving effect to the conflict of
laws principles thereof.

11exv4w1

 

Exhibit 4.1

ISRAELI SHARE OPTION PLAN

 

FoxyTunes Ltd.

THE 2006 ISRAELI SHARE OPTION PLAN

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

This plan, as amended from time to time, shall be known as FoxyTunes Ltd. 2006
Israeli Share Option Plan.

 

 

ISRAELI SHARE OPTION PLAN

 

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 immediate 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; (v)
circumstances which deprive an employee of severance payment according to applicable law; and (vi)
any conduct (other than conduct in good faith) reasonably 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 2 members of the Board.

     2.8 “Company” means FoxyTunes Ltd., an Israeli company.

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

     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 a 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:

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ISRAELI SHARE OPTION PLAN

 

          (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 2006 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.

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

     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 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.

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ISRAELI SHARE OPTION PLAN

 

     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, (iii) the form
of transaction contemplated by the Agreement dated December 19,
2007 by and between Yahoo! Inc. and 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(c) 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.

     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 Approved 102 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.

     3.4 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.

     3.5 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.

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ISRAELI SHARE OPTION PLAN

 

     3.6 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.

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 CGO or OIO granted to
Employees (the “Election”), shall be appropriately filed with the ITA before 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

 

ISRAELI SHARE OPTION PLAN

 

     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 With regards to Approved 102 Options, 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.

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 any additional rights issued in respect of the
Approved 102 Options or shares received subsequently, including without limitation 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 (the “Holding Period”). In case the requirements for Approved 102 Options
are not met, then the Approved 102 Options may be treated as Unapproved 102 Options, all in
accordance with the provisions of Section 102 and regulations promulgated thereunder.

     6.2 Notwithstanding anything to the contrary, the Trustee shall not release any Shares
allocated or issued upon exercise of Approved 102 Options and any additional rights issued in
respect of the Approved 102 Options or shares received subsequently, 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 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 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 or any additional rights issued in
respect of the Approved 102 Options or shares received subsequently, including without
limitation, bonus shares, until the lapse of the Holding Period required under Section 102 of the
Ordinance. Notwithstanding the above, if any such sale or release occurs during the Holding
Period, the sanctions under Section 102 of the Ordinance and under any rules or regulation or
orders or procedures promulgated thereunder shall apply to and shall be borne by such Optionee.

     6.4 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 190,003 authorized but unissued Shares, for the purposes of the
ISOP and for the purposes of any other share option plans which may be adopted by the Company in
the future, 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, but until termination of the ISOP the Company
shall at all times reserve sufficient number of Shares to meet the requirements 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

6

 

ISRAELI SHARE OPTION PLAN

 

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
CGO, 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. Without derogating from the above, with respect to Approved 102 Options, such shares
shall be voted in accordance with the provisions of Section 102 and any rules, regulations or
orders promulgated thereunder.

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 or 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 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 9.1above, 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 10 days prior to
the effective date of the Transaction.

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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,
for each 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 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.

     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.

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.

8

 

ISRAELI SHARE OPTION PLAN

 

     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 10.5below.

     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 10.5below, 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 Subject to the provisions of Section 10.5 below, in the event of termination of
Optionee’s employment or services, with the Company or any of its Affiliates, all Options granted
to such Optionee will immediately expire. A notice of termination of employment or service shall
be deemed to constitute termination of employment or service. For the avoidance of doubt, in case
of such termination of employment or service, the unvested portion of the Optionee’s Option shall
not vest and shall not become exercisable.

     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 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 12 months after the
date of such termination; or -

          (iii) prior to the date of such termination, 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 To avoid doubt, 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 6of the ISOP.

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

     10.8 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.

9

 

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 6 months and one day of the date of exercise of such Option or issuance of such
Shares. 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 as set forth in the Articles of Association of the Company.

13. DIVIDENDS. 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 quantity 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, and when applicable subject to the provisions of Section
102 and the rules, regulations or orders promulgated thereunder.

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, cannot 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 10 years from such day of adoption.

     The Company shall obtain the approval of the Company’s shareholders for the adoption of this
ISOP or for any amendment to this ISOP, if shareholders’ approval is necessary or desirable to
comply with any applicable law including without limitation the US securities law or the
securities laws of other jurisdiction applicable to Options granted to Optionees under this ISOP,
or if shareholders’ approval is required by any authority or by any governmental agencies or
national securities exchanges including without limitation the US Securities and Exchange
Commission.

10

 

ISRAELI SHARE OPTION PLAN

 

16. AMENDMENTS OR TERMINATION. The Board may at any time, but when applicable, after
consultation with the Trustee, 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 herein shall 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 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.

     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.

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.

11

 

ISRAELI SHARE OPTION PLAN

 

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.

12

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