Document:

bonusplan.htm

    
      

      

    

    Exhibit
      10.1

     

     

    
 

    PERFICIENT,
      INC.

     

    OMNIBUS
      INCENTIVE PLAN

     

     

     

     

     

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    TABLE
      OF CONTENTS

     

     

    
      
        	
                1.

              	
                Purpose

              	
                1

              
	 	 	 	 
	
                2.

              	
                Definitions

              	
                1

              
	 	
                (a)

              	
                Annual
                  Incentive Award

              	
                1

              
	 	
                (b)

              	
                Annual
                  Incentive Award Performance Period

              	
                1

              
	 	
                (c)

              	
                Award

              	
                1

              
	 	
                (d)

              	
                Board

              	
                1

              
	 	
                (e)

              	
                Business
                  Day

              	
                1

              
	 	
                (f)

              	
                Cause

              	
                1

              
	 	
                (g)

              	
                Change
                  of Control

              	
                2

              
	 	
                (h)

              	
                Code

              	
                2

              
	 	
                (i)

              	
                Committee

              	
                2

              
	 	
                (j)

              	
                Covered
                  Employee

              	
                2

              
	 	
                (k)

              	
                Discretionary
                  Award

              	
                3

              
	 	
                (l)

              	
                Effective
                  Date

              	
                3

              
	 	
                (m)

              	
                Eligible
                  Person

              	
                3

              
	 	
                (n)

              	
                Exchange
                  Act

              	
                3

              
	 	
                (o)

              	
                Fair
                  Market Value

              	
                3

              
	 	
                (p)

              	
                Good
                  Reason

              	
                3

              
	 	
                (q)

              	
                Listing
                  Requirement

              	
                4

              
	 	
                (r)

              	
                Participant

              	
                4

              
	 	
                (s)

              	
                Performance
                  Award

              	
                4

              
	 	
                (t)

              	
                Qualified
                  Member

              	
                4

              
	 	
                (u)

              	
                Rule
                  16b-3

              	
                4

              
	 	
                (v)

              	
                Securities
                  Act

              	
                4

              
	 	
                (w)

              	
                Stock

              	
                4

              
	 	
                (x)

              	
                Stock
                  Incentive Plan

              	
                4

              
	 	
                (y)

              	
                Subsidiary

              	
                4

              
	 	 	 	 
	
                3.

              	
                Administration

              	
                4

              
	 	
                (a)

              	
                Authority
                  of the Committee

              	
                4

              
	 	
                (b)

              	
                Manner
                  of Exercise of Committee Authority

              	
                5

              
	 	
                (c)

              	
                Limitation
                  of Liability

              	
                6

              
	 	 	 	 
	
                4.

              	
                Eligibility;
                  Per Person Award Limitations

              	
                6

              
	 	 	 	 
	
                5.

              	
                Awards

              	
                7

              
	 	
                (a)

              	
                Grant
                  of Awards Performance Conditions

              	
                7

              
	 	
                (b)

              	
                Performance
                  Goals Applicable to Awards

              	
                7

              
	 	
                (c)

              	
                Performance
                  Awards

              	
                8

              
	 	
                (d)

              	
                Annual
                  Incentive Awards

              	
                10

              
	 	
                (e)

              	
                Discretionary
                  Awards

              	
                11

              
	 	
                (f)

              	
                Written
                  Determinations and Certification

              	
                12

              

      

      
        
          
          

        

        
          (i)

          
            

          

        

        
          
          

        

      

      
        	 	
                (g)

              	
                Status
                  of Awards under Section 162(m) of the Code

              	
                12

              
	 	
                (h)

              	
                Adjustments
                  for Material Changes

              	
                12

              
	 	 	 	 
	
                6.

              	
                General
                  Provisions

              	
                13

              
	 	
                (a)

              	
                Taxes

              	
                13

              
	 	
                (b)

              	
                Changes
                  to this Plan and Awards

              	
                13

              
	 	
                (c)

              	
                Limitation
                  on Rights Conferred Under Plan

              	
                13

              
	 	
                (d)

              	
                Unfunded
                  Status of Awards

              	
                14

              
	 	
                (e)

              	
                Nonexclusivity
                  of this Plan

              	
                14

              
	 	
                (f)

              	
                Fractional
                  Shares

              	
                14

              
	 	
                (g)

              	
                Severability

              	
                14

              
	 	
                (h)

              	
                Governing
                  Law

              	
                14

              
	 	
                (i)

              	
                Conditions
                  to Delivery of Stock

              	
                14

              
	 	
                (j)

              	
                Plan
                  Effective Date and Stockholder Approval

              	
                15

              
	 	 	 	 

      

     

    
      
        
          
          

        

        
          (ii)

          
            

          

        

        
          
          

        

      

    

    

    PERFICIENT,
      INC.

     

    OMNIBUS
      INCENTIVE PLAN

     

    1.   Purpose.  The
      purpose of the Perficient, Inc. Omnibus Incentive Plan (the “Plan”) is to
      provide a means through which Perficient, Inc., a Delaware corporation (the
      “Company”), may attract and retain able persons as employees of the Company and
      provide such employees with incentive and reward opportunities designed to
      enhance the profitable growth of the Company and benefit the stockholders of
      the
      Company.  Accordingly, this Plan provides for granting Performance
      Awards and Annual Incentive Awards, as described below, as is best suited to
      the
      circumstances of the particular individual and the needs of the Company as
      provided herein.

     

    2.   Definitions.  For
      purposes of this Plan, the following terms will be defined as set forth below,
      in addition to such terms defined in Section 1 of this Plan:

     

    (a)           “Annual
      Incentive Award” means a conditional right granted to a Participant
      under Section 5(d) of this Plan to receive (after the end of a specified fiscal
      year or other twelve (12) month period specified by the Committee) a cash
      payment, Stock or other property determined by the Committee, based upon
      performance criteria specified by the Committee.

     

    (b)           “Annual
      Incentive Award Performance Period” means (i) each fiscal year of the
      Company or other twelve (12) month period identified by the Committee as being
      a
      performance measurement period with respect to one or more Annual Incentive
      Awards or (ii) any other period ending at such other date as may be required
      or
      permitted in the case of Annual Incentive Awards intended to be
“performance-based compensation” under section 162(m) of the Code.

     

    (c)           “Award”
      means any Annual Incentive Award, Performance Award or a Discretionary Award,
      granted to a Participant under this Plan.

     

    (d)           “Board”
      means the Company’s Board of Directors.

     

    (e)           “Business
      Day” means any day other than a Saturday, a Sunday, or a day on which
      banking institutions in the state of Texas are authorized or obligated by law
      or
      executive order to close.

     

    (f)           
      “Cause” means “cause” as defined in the employment agreement
      between the Company and a Participant, if any, or in the absence of such an
      agreement or such a definition, “Cause” means:

     

    (i)            
      the repeated or willful failure of a Participant to substantially perform his
      duties hereunder (other than any such failure due to physical or mental illness)
      that has not been cured reasonably promptly after a written demand for
      substantial performance is delivered to Participant by the chief executive
      officer of the Company (“CEO”), which demand identifies the
      manner in which the CEO believes that Participant has not substantially
      performed his duties hereunder;

     

    

    
      
        
          
          

        

        
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    (ii)           
      conviction of, or entering a plea of guilty or nolo contendere to
      a crime involving moral turpitude or dishonesty or to any
      other crime that constitutes a felony;

     

    (iii)           Participant’s
      intentional misconduct, gross negligence or material misrepresentation in
      the performance of his duties to the Company; or

     

    (iv)           the
      material breach by Participant of any written covenant or agreement with the
      Company, including, but not limited to, an agreement not to disclose any
      information pertaining to the Company or not to compete with the
      Company.

     

    (g)           “Change
      of Control” means the occurrence of any of the following
      events:

     

    (i)           
      a merger, consolidation or reorganization approved by the Company’s
      stockholders, unless securities representing more than fifty percent (50%)
      of
      the total combined voting power of the voting securities of the successor
      corporation are immediately thereafter beneficially owned, directly or
      indirectly and in substantially the same proportion, by the persons who
      beneficially owned the Company’s outstanding voting securities immediately prior
      to such transaction;

     

    (ii)           
      any stockholder-approved transfer or other disposition of all or substantially
      all of the Company’s assets; or

     

    (iii)           the
      acquisition, directly or indirectly by any person or related group of persons
      (other than the Company or a person that directly or indirectly controls, is
      controlled by, or is under common control with, the Company), of beneficial
      ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities
      possessing more than fifty percent (50%) of the total combined voting power
      of
      the Company’s outstanding securities pursuant to a tender or exchange offer made
      directly to the Company’s stockholders which the Board recommend such
      stockholders to accept.

     

    (h)           “Code”
      means the Internal Revenue Code of 1986, as amended from time to time, including
      regulations thereunder and successor provisions and regulations
      thereto.

     

    (i)           
      “Committee” means a committee of two or more directors
      designated by the Board to administer this Plan; provided, however, that, unless
      otherwise determined by the Board, the Committee will consist solely of two
      or
      more directors, each of whom will be a “non-employee director” within the
      meaning of Rule 16b-3 under the Exchange Act, an “outside director” as defined
      under section 162(m) of the Code, unless administration of this Plan by “outside
      directors” is not then required in order to qualify for tax deductibility under
      section 162(m) of the Code and, to the extent required by any applicable Listing
      Requirement, an “independent” director.

     

    (j)           
      “Covered Employee” means an Eligible Person who is a Covered
      Employee as specified in Section 5(g) of this Plan.

     

    

    
      
        
          
          

        

        
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    (k)           “Discretionary
      Award” means a conditional right granted to a Participant under Section
      5(e) of this Plan to receive a cash payment, Stock or other property determined
      by the Committee, based upon criteria specified by the Committee.

     

    (l)           
      “Effective Date” means January 1, 2007.

     

    (m)          “Eligible
      Person” means all officers and employees of the Company or of any
      Subsidiary.  An employee on leave of absence may be considered as
      still in the employ of the Company or a Subsidiary for purposes of eligibility
      for participation in this Plan.

     

    (n)           “Exchange
      Act” means the Securities Exchange Act of 1934, as amended from time to
      time, including regulations thereunder and successor provisions and regulations
      thereto.

     

    (o)           “Fair
      Market Value” means with respect to a share of Stock, as of any
      date:

     

    (i)            
      If the Stock is at the time traded on the Nasdaq National Market, then the
      Fair
      Market Value shall be the closing selling price per share of Stock on the date
      in question, as such price is reported on the Nasdaq National Market or any
      successor system. If there is no closing selling price for the Stock on the
      date
      in question, then the Fair Market Value shall be the closing selling price
      on
      the last preceding date for which such quotation exists; or

     

    (ii)           
      If the Stock is at the time listed on any Stock Exchange, then the Fair Market
      Value shall be the closing selling price per share of Stock on the date in
      question on the Stock Exchange determined by the Plan Administrator to be the
      primary market for the Stock, as such price is officially quoted in the
      composite tape of transactions on such exchange. If there is no closing selling
      price for the Stock on the date in question, then the Fair Market Value shall
      be
      the closing selling price on the last preceding date for which such quotation
      exists.

     

    (iii)           If
      shares of Stock are not traded on the Nasdaq National Market as provided in
      subparagraph (i) or listed or admitted to unlisted trading privileges as
      provided in subparagraph (ii) as of the date of determining the Fair Market
      Value, then the value determined in good faith by the Committee which
      determination shall be conclusive for all purposes.

     

    (p)           “Good
      Reason” means “good reason” as defined in the employment agreement
      between the Company and a Participant, if any, or in the absence of such an
      agreement or such a definition, “Good Reason” means:

     

    (i)           
      A reduction in the Participant’s salary during a twelve (12)-month month period
      of ten percent (10%) or more and no corresponding reduction is made in the
      salaries of other employees having comparable roles and responsibilities with
      the Company;

     

    (ii)           
      a relocation of the Participant’s primary office to a location outside the 50
      mile radius surrounding Participant’s then present location; or

     

    (iii)           a
      relocation of the Participant’s primary office to a location outside a radius
      surrounding Participant’s then present location that is more than twenty (20)
      miles but 

    

    
      
        
          
          

        

        
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    less
      than fifty (50) miles and the Company does not
      permit the Participant to perform his duties for the Company from the
      Participant’s residence.

     

    (q)           “Listing
      Requirement” means the applicable requirements of any listing agreement
      pursuant to which the securities of the Company are listed and registered or
      admitted to unlisted trading privileges on a securities exchange or consolidated
      transaction reporting system.

     

    (r)           
      “Participant” means a person who has been granted an Award
      under this Plan that remains outstanding.

     

    (s)          
      “Performance Award” means a conditional right granted to a
      Participant under Section 5(c) of this Plan to receive (after the end of a
      specified fiscal year or other period specified by the Committee) a cash
      payment, Stock or other property determined by the Committee, based upon
      performance criteria specified by the Committee.

     

    (t)           
      “Qualified Member” means a member of the Committee who is a
“Non-Employee Director” within the meaning of Rule 16b-3(b)(3), an “outside
      director” within the meaning of Treasury Regulation §1.162-27 under section
      162(m) of the Code and, to the extent required by any applicable Listing
      Requirement, an “independent” director.

     

    (u)           “Rule
      16b-3” means Rule 16b-3, promulgated by the Securities and Exchange
      Commission under section 16 of the Exchange Act, as from time to time in
      effect.

     

    (v)           “Securities
      Act” means the Securities Act of 1933, as amended from time to time,
      including regulations thereunder and successor provisions and regulations
      thereto.

     

    (w)          “Stock”
      means the Company’s Common Stock, par value $.01 per share, and such other
      securities as may be substituted (or resubstituted) for Stock.

     

    (x)           “Stock
      Incentive Plan” means the Company’s 1999 Stock Option/Stock Issuance
      Plan.

     

    (y)           “Subsidiary”
      means any corporation (other than the Company) in an unbroken chain of
      corporations beginning with the Company, provided each corporation (other than
      the last corporation) in the unbroken chain owns, at the time of the
      determination, stock possessing fifty percent (50%) or more of the total
      combined voting power of all classes of stock in one of the other corporations
      in such chain.

     

    3.   Administration.

     

    (a)           Authority
      of the Committee.  This Plan will be administered by the
      Committee except to the extent the Board elects, in order to comply with Rule
      16b-3 or for any other reason, to administer this Plan, in which case references
      herein to the “Committee” will be deemed to include references to the
“Board.”  Unless required by applicable law, nothing contained herein
      will be deemed to authorize or require the Committee to violate (by action
      or
      inaction) any Listing Requirement.  Subject to the express provisions
      of this Plan, Rule 16b-3, 

     

    

    
      
        
          
          

        

        
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    and
      all applicable Listing Requirements, the
      Committee will have the authority, in its sole and absolute discretion,
      to:

     

    (i)            
      adopt, amend, and rescind administrative and interpretive rules and regulations
      relating to this Plan;

     

    (ii)           
      determine the Eligible Persons to whom, and the time or times at which, Awards
      will be granted;

     

    (iii)           determine
      the amount of cash, the number of shares of Stock, the amount of other property
      or any combination thereof, that will be the subject of each Award;

     

    (iv)           determine
      the terms and conditions of each Award (which need not be identical) and
      communicate or cause to be communicated such terms and conditions to the
      Eligible Person;

     

    (v)           
      make determinations of the Fair Market Value of the Stock pursuant to this
      Plan;

     

    (vi)           delegate
      its duties under this Plan to such agents as it may appoint from time to time,
      provided that the Committee may not delegate its duties with respect to making
      Awards to, or otherwise with respect to Awards granted to, Eligible Persons
      who
      are subject to section 16(b) of the Exchange Act or section 162(m) of the
      Code;

     

    (vii)          subject
      to ratification by the Board, terminate, modify, or amend this Plan;
      and

     

    (viii)         make
      all other determinations, perform all other acts, and exercise all other powers
      and authority necessary or advisable for administering this Plan, including
      the
      delegation of those ministerial acts and responsibilities as the Committee
      deems
      appropriate.

     

    Subject
      to Rule 16b-3, section 162(m) of the Code and applicable Listing Requirements,
      the Committee may correct any defect, supply any omission, or reconcile any
      inconsistency in this Plan or in any Award in the manner and to the extent
      it
      deems necessary or desirable to carry this Plan into effect, and the Committee
      will be the sole and final judge of that necessity or
      desirability.  The determinations of the Committee on the matters
      referred to in this Section 3(a) will be final and conclusive.

     

    (b)           Manner
      of Exercise of Committee Authority.  At any time that a
      member of the Committee is not a Qualified Member, any action of the Committee
      (i) relating to an Award granted or to be granted to a Participant who is then
      either (A) subject to section 16 of the Exchange Act in respect of the Company
      or (B) an “executive officer” within the meaning of applicable Listing
      Requirements, or (ii) relating to an Award intended by the Committee to qualify
      as “performance-based compensation” within the meaning of section 162(m) of the
      Code and regulations thereunder, may be taken either:

     

    (i)            
      by a subcommittee, designated by the Committee, composed solely of two or more
      Qualified Members, or

     

    

    
      
        
          
          

        

        
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    (ii)           
      by the Committee but with each such member who is not a Qualified Member
      abstaining or recusing himself or herself from discussion or approval of such
      action; provided, however, that, upon such abstention or recusal, the Committee
      remains composed solely of two or more Qualified Members.

     

    Such
      action, authorized by such a subcommittee or by the Committee upon the
      abstention or recusal of such non-Qualified Member(s), will be the action of
      the
      Committee for purposes of this Plan.  Any action of the Committee will
      be final, conclusive and binding on all persons, including the Company, its
      subsidiaries, stockholders, Participants, or other persons claiming rights
      from
      or through a Participant.  The express grant of any specific power to
      the Committee, and the taking of any action by the Committee, will not be
      construed as limiting any power or authority of the Committee.  The
      Committee may delegate to officers or managers of the Company or any Subsidiary,
      or committees thereof, the authority, subject to such terms as the Committee
      will determine, to perform such functions, including administrative functions,
      as the Committee may determine, to the extent that such delegation will not
      result in the loss of an exemption under Rule 16b-3(d)(1) for Awards granted
      to
      Participants subject to section 16 of the Exchange Act in respect of the
      Company, will not violate any applicable Listing Requirement and will not cause
      Awards intended to qualify as “performance-based compensation” under section
      162(m) of the Code to fail to so qualify.  The Committee may appoint
      agents to assist it in administering this Plan.

     

    (c)           Limitation
      of Liability.  The Committee and each member thereof will be
      entitled to, in good faith, rely or act upon any report or other information
      furnished to him or her by any officer or employee of the Company or a
      Subsidiary, the Company’s legal counsel, independent auditors, consultants or
      any other agents assisting in the administration of this
      Plan.  Members of the Committee and any officer or employee of the
      Company or a Subsidiary acting at the direction or on behalf of the Committee
      will not be personally liable for any action or determination taken or made
      in
      good faith with respect to this Plan, and will, to the fullest extent permitted
      by law, be indemnified and held harmless by the Company with respect to any
      such
      action or determination.

     

    4.   Eligibility;
      Per Person Award Limitations.  Awards may be granted under
      this Plan only to Eligible Persons.  The maximum amount of
      compensation that can be paid pursuant to the Plan with respect
      to any twelve (12) month period specified by the
      Committee to a Covered Employee is two million dollars
      ($2,000,000).  In the case of Performance Awards which are based on a
      period in excess of twelve (12) months, or Discretionary Awards that are based
      on a period in excess of twelve (12) months, this annual limit will be
      multiplied by the number of years, or portions thereof in the performance or
      award period (e.g., if the performance period is 24 months, the limit
      will be four million dollars ($4,000,000).  In the event that Awards
      granted under this Plan are settled in Stock, the per person Award limit set
      forth in this Section 4 will be determined based on the Fair Market Value of
      such Stock on the date the Award is settled in Stock or on the first trading
      date that is not within the “black-out period” prescribed by the Company’s
      Insider Trading Policy following the date the Award is settled in Stock, as
      specified in the Award 

    

    
      
        
          
          

        

        
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    agreement.  Any Stock paid in settlement of an award
      will be issued under the Stock Incentive Plan and will count against maximum
      share limit provided under section 1.5(b) of the Stock Incentive Plan and be
      subject to all of the terms and conditions of the Stock Incentive
      Plan.

     

    5.   Awards.

     

    (a)           Grant
      of Awards Performance Conditions.  The right of a Participant
      to receive a grant or settlement of any Award, and the timing thereof, may
      be
      subject to such performance conditions as may be specified by the
      Committee.  Such performance conditions need not be
      uniform.  The Committee may use such business criteria and other
      measures of performance as it may deem appropriate in establishing any
      performance conditions, and may exercise its discretion to reduce or increase
      the amounts payable under any Award subject to performance conditions, except
      as
      limited under Sections 5(c) and 5(d) of this Plan in the case of a Performance
      Award or Annual Incentive Award intended to qualify under section 162(m) of
      the
      Code.  Performance Awards will be based on the period specified by the
      Committee, as described in Section 5(c)(i).  Annual Incentive Awards
      will be based on the Company’s fiscal year or other twelve (12) month period
      specified by the Committee, as described in Section 5(d)(i).  In
      addition, the Committee can also grant awards not subject to performance
      conditions (i.e., Discretionary Awards) as it deems
      appropriate.

     

    (b)           Performance
      Goals Applicable to Awards.

     

    (i)            
      Performance Goals Generally.  The performance goals
      for Performance Awards and Annual Incentive Awards will consist of one or more
      business criteria or individual performance criteria and a targeted level or
      levels of performance with respect to each of such criteria, as specified by
      the
      Committee consistent with this Section 5(b).  In addition,
      Discretionary Awards may be subject to business or individual performance
      criteria as the Committee may specify.  Performance goals will be
      objective and will otherwise meet the requirements of section 162(m) of the
      Code
      and regulations thereunder (including Treasury Regulation §1.162-27 and
      successor regulations thereto), including the requirement that the level or
      levels of performance targeted by the Committee result in the achievement of
      performance goals that are “substantially uncertain.”  The Committee
      may determine that such Performance Awards, Annual Incentive Awards and/or
      Discretionary Awards will be granted and/or settled upon achievement of any
      one
      performance goal or that two or more of the performance goals must be achieved
      as a condition to grant and/or settlement of such Performance Awards, Annual
      Incentive Awards or Discretionary Awards.  Performance goals may
      differ for Performance Awards, Annual Incentive Awards and/or Discretionary
      Awards granted to any one Participant or to different
      Participants.  In addition, the Committee may make Discretionary
      Awards that are not subject to any business or individual performance
      criteria.

     

    (ii)           
      Business and Individual Performance Criteria.

     

    (A)           Business
      Criteria.  One or more of the following business criteria for
      the Company, on a consolidated basis, and/or for specified subsidiaries or
      business or geographical units of the Company (except with respect to the total
      stockholder return and earnings per share criteria), will be used by the
      Committee in establishing performance goals for such Performance Awards and
      Annual Incentive 

     

    

    
      
        
          
          

        

        
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    Awards
      and may be used by the Committee in
      establishing performance goals for Discretionary Awards:  (a) earnings
      per share (including cash earnings per share and GAAP earnings per share);
      (b)
      revenues; (c) increase in revenues; (d) increase in cash flow; (e) increase
      in
      cash flow return; (f) return on net assets; (g) return on assets;
      (h)  return on investment; (i) return on capital; (j) return on
      equity; (k) economic value added; (l) operating margin; (m) contribution margin;
      (n) net income before taxes; (o) net income after taxes; (p) net income per
      share; (q) pretax earnings; (r) pretax earnings before interest depreciation
      and
      amortization; (s) pretax operating earnings after interest expense and before
      incentives, service fees, and extraordinary or special items; (t) operating
      income; (u) total stockholder return; (v) debt reduction; (w) stock price;
      (x)
      market share; and (y) any of the above goals determined on an absolute or
      relative basis or as compared to the performance of a published or special
      index
      deemed applicable by the Committee including, but not limited to, the Standard
      & Poor’s 500 Stock Index or a group of companies deemed by the Committee to
      be comparable to the Company.

     

    (B)           Individual
      Performance Criteria.  The grant and/or settlement of
      Performance Awards, Annual Incentive Awards and/or Discretionary Awards may
      also
      be contingent upon individual performance goals established by the
      Committee.  If required for compliance with section 162(m) of the Code
      or any applicable Listing Requirement, such criteria will be approved by the
      stockholders of the Company.

     

    (c)           Performance
      Awards.  Performance Awards may be granted to Eligible
      Persons as determined by the Committee, in its sole and absolute
      discretion.  If the Committee determines that a Performance Award to
      be granted to an Eligible Person who is designated by the Committee as likely
      to
      be a Covered Employee is likely to qualify as “performance-based compensation”
for purposes of section 162(m) of the Code, the grant and/or settlement of
      such
      Performance Award may be made contingent upon achievement of pre-established
      performance goals and other terms set forth in this Section 5(c).

     

    (i)           Performance
      Period; Timing for Establishing Performance
      Goals.  Achievement of performance goals in respect of Performance
      Awards will be measured over a performance period of up to
      five (5) years, as specified by the
      Committee.  Performance goals will be established not later than the
      earlier of (i) ninety (90) days after the beginning of any performance period,
      (ii) the expiration of twenty five percent (25%) of the performance period
      applicable to such Performance Awards, or (iii) such other date as may be
      required or permitted for “performance-based compensation” under section 162(m)
      of the Code.

     

    (ii)           Performance
      Award Pool.  The Committee may establish a Performance Award
      pool, which will be an unfunded pool, for purposes of compensating Eligible
      Persons who are entitled to the payment of Performance Awards.  The
      amount of such Performance Award pool will be based upon the achievement of
      a
      performance goal or goals based on one or more of the criteria set forth in
      Section 5(b)(ii) of this Plan during the given performance period, as specified
      by the Committee in accordance with Section 5(c)(i) of this Plan.  The
      Committee may specify the amount of the Performance Award pool as a percentage
      of 

    

    
      
        
          
          

        

        
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    any
      of
      such criteria, a percentage thereof in excess of a threshold amount, or as
      another amount that need not bear a strictly mathematical relationship to such
      criteria. 
       

      (iii)           Calculation
        of Performance Awards.  Not later than ninety (90) days
        following the expiration of each performance period, or at such other date
        as
        may be required or permitted in the case of Awards intended to be
“performance-based compensation” under section 162(m) of the Code, the Committee
        will calculate the amounts payable to each Participant granted a Performance
        Award with respect that performance period, either out of a Performance Award
        pool established under Section 5(c)(ii) of this Plan or out of an individual
        Performance Award.  In the case of an individual Performance Award
        intended to qualify under section 162(m) of the Code, the amount payable
        will be
        based upon the achievement of a performance goal or goals based on one or
        more
        of the business criteria set forth in Section 5(b)(ii) of this Plan in the
        given
        performance period, as specified by the Committee; in other cases, such amount
        will be based on such criteria as will be established by the
        Committee.  In all cases, the maximum Performance Award of any
        Participant will be subject to the limitation set forth in Section 4 of this
        Plan.  In the case of a Performance Award subject to section 162(m) of
        the Code, the Committee will certify that the applicable performance goals
        were
        met prior to the payment of such awards as provided in Section 5(f) of this
        Plan.
      

    (iv)           Settlement
      of Performance Awards.  Performance Awards will be settled
      (i.e. paid) after the end of each performance period and calculation of the
      amount of Performance Awards pursuant to Section 5(c)(iii) of this Plan
      (including, to the extent applicable, the certification of such awards pursuant
      to Section 5(f)).  Settlement of Performance Awards will be in cash,
      Stock, or other property, as determined by the Committee and set forth in the
      Award Agreement.  Any Stock awarded in settlement of a Performance
      Award may be subject to a vesting schedule as determined by the Committee and
      established pursuant to the Stock Incentive Plan.  The Committee may
      not exercise discretion to increase any such amount payable to a Covered
      Employee in respect of a Performance Award subject to the requirements of
      section 162(m) of the Code.  A Performance Award will be paid to the
      Participant as soon as administratively feasible following the end of the
      performance period, the satisfaction of the performance goals and calculation
      of
      the compensation payable pursuant to Performance Awards; provided that the
      Participant is still an employee of the Company or a Subsidiary on the last
      day
      of the performance period, except as provided in this Section
      5(c)(iv).  No pro rata payment of any Performance Award that is
      subject to the requirements of section 162(m) of the Code may be made to a
      Participant who is a Covered Employee except that, as permitted by Treasury
      Regulation §1.162-27(e)(2)(v) and to the extent provided in the terms of an
      Award, pro rata payment of any such Performance Award may be made to a
      Participant who is a Covered Employee in the event of such Participant’s death,
      disability or a Change of Control.  Further, pro rata payment of a
      Performance Award may be made, to the extent provided in the terms of an Award,
      to a Participant who is a Covered Employee in the event of the termination
      of
      such Participant without Cause or on account of a resignation for Good
      Reason.  With respect to those Participants who are not Covered
      Employees, the Committee may permit the pro rata payment of a Performance Award
      in its sole and absolute discretion.  In the event that payment of a
      Performance Award to a Covered Employee, would not be deductible by the Company
      pursuant to section 162(m) of the Code, then payment of the amount of such
      Award
      which is not deductible will automatically be deferred, with interest equivalent
      to 120% of the long term applicable federal rate compounded annually in the
      month of such deferral, up to earliest of (i)

     

    
      
        
        

      

      
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     the
      date at which the Company reasonably anticipates that the deduction of the
      payment of the amount will not be limited or eliminated by application of
      section 162(m) of the Code or (ii) the date which is six (6) months and one
      (1)
      day following the Covered Employee’s termination of employment.

     

    (d)           Annual
      Incentive Awards.  Annual Incentive Awards may be granted to
      Eligible Persons as determined by the Committee, in its sole and absolute
      discretion.  If the Committee determines that an Annual Incentive
      Award to be granted to an Eligible Person who is designated by the Committee
      as
      likely to be a Covered Employee is likely to qualify as “performance-based
      compensation” for purposes of section 162(m) of the Code, the grant and/or
      settlement of such Annual Incentive Award will be contingent upon achievement
      of
      pre-established performance goals and other terms set forth in this Section
      5(d).

     

    (i)           Performance
      Period; Timing for Establishing Performance
      Goals.  Achievement of performance goals in respect of such Annual
      Incentive Awards will be measured over an Annual Incentive Award Performance
      Period.  Performance goals will be established not later than the
      earlier of (i) ninety (90) days after the beginning of any Annual Incentive
      Award Performance Period, (ii) the expiration of twenty five percent (25%)
      of
      the Annual Incentive Award Performance Period applicable to such Annual
      Incentive Awards, or (iii) such other date as may be required or permitted
      for
“performance-based compensation” under section 162(m) of the Code.

     

    (ii)          Annual
      Incentive Award Pool.  The Committee may establish an Annual
      Incentive Award pool, which will be an unfunded pool, for purposes of
      compensating Eligible Persons who are entitled to the payment of Annual
      Incentive Awards.  The amount of such Annual Incentive Award pool will
      be based upon the achievement of a performance goal or goals based on one or
      more of the business criteria set forth in Section 5(b)(ii) of this Plan during
      the given performance period, as specified by the Committee in accordance with
      Section 5(d)(i) of this Plan.  The Committee may specify the amount of
      the Annual Incentive Award pool as a percentage of any of such business
      criteria, a percentage thereof in excess of a threshold amount, or as another
      amount that need not bear a strictly mathematical relationship to such business
      criteria.

     

    (iii)         Calculation
      of Annual Incentive Awards.  Not later than ninety (90) days
      following the expiration of each Annual Incentive Award Performance Period,
      the
      Committee will calculate the amounts payable to each Participant granted an
      Annual Incentive Award with respect to that Annual Incentive Award Performance
      Period, either out of an Annual Incentive Award pool established under Section
      5(d)(ii) of this Plan or out of an individual Annual Incentive
      Award.  In the case of individual Annual Incentive Awards intended to
      qualify under section 162(m) of the Code, the amount potentially payable will
      be
      based upon the achievement of a performance goal or goals based on one or more
      of the business criteria set forth in Section 5(b)(ii) of this Plan in the
      given
      Annual Incentive Award Performance Period, as specified by the Committee; in
      other cases, such amount will be based on such criteria as will be established
      by the Committee.  In all cases, the maximum Annual Incentive Award of
      any Participant will be subject to the limitation set forth in Section 4 of
      this
      Plan.  In the case of an Annual Incentive Award subject to section
      162(m) of the Code, the Committee will certify that 

     

    
      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

    

    the
      applicable performance goals were met prior to the payment of such awards as
      provided in Section 5(f) of this Plan. 
       

      (iv)           Settlement
        of Annual Incentive Awards.  Annual Incentive Awards will be
        settled (i.e., paid) after the end of each Annual Incentive Award
        Performance Period and the calculation of the amount of such Awards pursuant
        to
        Section 5(d)(iii) (including, to the extent applicable, the certification
        of
        such awards pursuant to Section 5(f)).  Settlement of Annual Incentive
        Awards will be in cash, Stock, or other property, as determined by the Committee
        and set forth in the Award Agreement.  Any Stock awarded in settlement
        of an Annual Incentive Award may be subject to a vesting schedule as determined
        by the Committee.  The Committee may not exercise discretion to
        increase any such amount in the case of an Annual Incentive Award intended
        to
        qualify under section 162(m) of the Code.  Annual Incentive Awards
        will be paid to the Participant as soon as administratively feasible following
        the end of the Annual Incentive Award Performance Period, the satisfaction
        of
        the performance goals and calculation of the compensation payable pursuant
        to
        Annual Incentive Awards; provided that the Participant is still an employee
        of
        the Company or a Subsidiary on the last day of the Annual Incentive Award
        Performance Period, except as provided in this Section 5(d)(iv).  No
        pro rata payment of any Annual Incentive Award that is subject to the
        requirements of section 162(m) of the Code may be made to a Participant who
        is a
        Covered Employee except that, as permitted by Treasury Regulation
§1.162-27(e)(2)(v), pro rata payment of any such Annual Incentive Award may
        be
        made to any Participant who is a Covered Employee in the event of such
        Participant’s death, disability or a Change of Control.  Further, pro
        rata payment of an Annual Incentive Award may be made to a Participant who
        is a
        Covered Employee in the event of the termination of such Participant without
        Cause or on account of a resignation for Good Reason.  With respect to
        those Participants who are not Covered Employees, the Committee may permit
        the
        pro rata payment of Annual Incentive Awards in it sole and absolute
        discretion.  In the event that payment of Annual Incentive Awards to a
        Covered Employee, would not be deductible by the Company pursuant to section
        162(m) of the Code, then payment of the amount of such Award which is not
        deductible will automatically be deferred, with interest equivalent to U.S.
        Treasury Bills, up to earliest of (i) April 30th of the first year in which
        the
        Company reasonably anticipates that the deduction of the payment of the amount
        will not be limited or eliminated by application of section 162(m) of the
        Code
        or (ii) the date which is six (6) months and one (1) day following the Covered
        Employee’s termination of employment.
   

    (e)           Discretionary
      Awards.  Discretionary Awards may be granted to Eligible
      Persons as determined by the Committee, in its sole and absolute
      discretion.  Discretionary Awards shall be subject to such terms and
      conditions as the Committee determines.  Discretionary Awards are not
      intended to qualify as “performance-based compensation” for purposes of section
      162(m) of the Code, but such Awards will be subject to the maximum limit on
      Plan
      Awards set forth in Section 4.  Further, no Covered Employee will have
      a right to any Discretionary Award as a substitute for an Annual Incentive
      Award
      or Performance Award in the event that the performance targets applicable to
      such Annual Incentive Award or Performance Award are not met.  In addition, no Discretionary Award will be
      granted
      to a Covered Employee in order to increase the amount of Annual Incentive Award
      or Performance Award that would have been paid had the applicable performance
      targets been met. Rather, any Discretionary Award granted to a Covered Employee
      will be independent from any Annual Incentive Award or Performance Award that
      may have also been granted to such Covered Employee and payment of

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    the
      Discretionary Award will be conditioned on the terms and conditions of such
      Discretionary Award. Settlement of Discretionary Awards will be in cash, Stock,
      or other property, as determined by the Committee and set forth in the Award
      Agreement.  Any Stock awarded in settlement of a Discretionary Award
      may be subject to a vesting schedule as determined by the
      Committee.

     

    (f)           Written
      Determinations and Certification.  All determinations by the
      Committee (i) as to the establishment of performance goals or the amount of
      any
      Performance Award pool or potential individual Performance Awards and as to
      the
      achievement of performance goals relating to Performance Awards under Section
      5(c), and (ii) as to the amount of any Annual Incentive Award pool or potential
      individual Annual Incentive Awards and as to the achievement of performance
      goals relating to Annual Incentive Awards under Section 5(d), will be made
      in
      writing and otherwise comply with the requirements of Treasury Regulation
      1.162-27 (and successor regulations thereto) in the case of any Award intended
      to qualify under section 162(m) of the Code.  The Committee may not
      delegate any responsibility relating to such Performance Awards or Annual
      Incentive Awards.

     

    (g)           Status
      of Awards under Section 162(m) of the Code.  It is the intent
      of the Company that Performance Awards and Annual Incentive Awards under
      Sections 5(c) and 5(d) of this Plan granted to persons who are designated by
      the
      Committee as likely to be Covered Employees within the meaning of section 162(m)
      of the Code and regulations thereunder (including Treasury Regulation §1.162-27
      and successor regulations thereto) will, if so designated by the Committee,
      constitute “performance-based compensation” within the meaning of section 162(m)
      of the Code and regulations thereunder.  Accordingly, the terms of
      Sections 5(b), (c), (d), (f) and (g), including the definitions of Covered
      Employee and other terms used therein, will be interpreted in a manner
      consistent with section 162(m) of the Code and regulations
      thereunder.  However, because the Committee cannot determine with
      certainty whether a given Participant will be a Covered Employee with respect
      to
      a fiscal year that has not yet been completed, the term Covered Employee as
      used
      herein will mean only a person designated by the Committee, at the time of
      grant
      of a Performance Award or an Annual Incentive Award, who is likely to be a
      Covered Employee with respect to that fiscal year.  If any provision
      of this Plan as in effect on the date of adoption or any agreements relating
      to
      a Performance Award or Annual Incentive Award that are designated as intended
      to
      comply with section 162(m) of the Code does not comply or is inconsistent with
      the requirements of section 162(m) of the Code or regulations thereunder, such
      provision will be construed or deemed amended to the extent necessary to conform
      to such requirements.

     

    (h)           Adjustments
      for Material Changes.  At the time the performance goals are
      set, such goals will specify the extent to which acquisitions, dispositions
      and
      equity financings will modify the determination of whether such performance
      goals have been met for the applicable performance period.  Further,
      as and to the extent permitted by section 162(m) of the Code, in the event
      of b)
      any extraordinary gain or loss or other event that is treated for accounting
      purposes as an extraordinary item under generally accepted accounting
      principles, or c) any material change in accounting policies or practices
      affecting the Company and/or the performance goals, then, to the extent any
      of
      the foregoing events was not anticipated at the time the performance goals
      were
      established, the Committee may make adjustments to the 

     

    
      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

    

     

    performance
      goals, based solely on objective criteria, so as to neutralize the effect of
      the
      event on the applicable Award.

     

    6.   General
      Provisions.

     

    (a)           Taxes.  The
      Company and any Subsidiary are authorized to withhold from any Award granted,
      or
      any payment relating to an Award under this Plan, including from a distribution
      of Stock, amounts of withholding and other taxes due or potentially payable
      in
      connection with any transaction involving an Award, and to take such other
      action as the Committee may deem advisable to enable the Company and
      Participants to satisfy obligations for the payment of withholding taxes and
      other tax obligations relating to any Award.  This authority will
      include authority to withhold or receive Stock or other property and to make
      cash payments in respect thereof in satisfaction of a Participant’s tax
      obligations, either on a mandatory or elective basis in the discretion of the
      Committee.

     

    (b)           Changes
      to this Plan and Awards.  The Board may amend, alter,
      suspend, discontinue or terminate this Plan or the Committee’s authority to
      grant Awards under this Plan without the consent of stockholders or
      Participants, except that any amendment or alteration to this Plan will be
      subject to the approval of the Company’s stockholders not later than the annual
      meeting next following such Board action if such stockholder approval is
      required by any federal or state law or regulation or any applicable Listing
      Requirement, and the Board may otherwise, in its discretion, determine to submit
      other such changes to this Plan to stockholders for approval; provided that,
      without the consent of an affected Participant, no such Board action may
      materially and adversely affect the rights of such Participant under any
      previously granted and outstanding Award.  The Committee may waive any
      conditions or rights under, or amend, alter, suspend, discontinue or terminate
      any Award theretofore granted, except as otherwise provided in this Plan;
      provided that, without the consent of an affected Participant, no such Committee
      action may materially and adversely affect the rights of such Participant under
      such Award.  Further, with respect to Stock Awards that are issued
      under the Stock Incentive Plan, the Committee’s power to make certain amendments
      to such Stock Awards is limited by the terms of section 5.6 of the Stock
      Incentive Plan.

     

    (c)           Limitation
      on Rights Conferred Under Plan.  Neither this Plan nor any
      action taken hereunder will be construed as:

     

    (i)           giving
      any Eligible Person or Participant the right to continue as an Eligible Person
      or Participant or in the employ or service of the Company or a
      Subsidiary;

     

    (ii)           interfering
      in any way with the right of the Company or a Subsidiary to terminate any
      Eligible Person’s or Participant’s employment or service at any
      time;

     

    (iii)           giving
      an Eligible Person or Participant any claim to be granted any Award under this
      Plan or to be treated uniformly with other Participants and employees;
      or

     

    (iv)           conferring
      on a Participant any of the rights of a stockholder of the Company unless and
      until the Participant is duly issued or transferred shares of Stock in
      accordance with the terms of an Award.

     

     

    
      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

    

       

    
      (d)           Unfunded
        Status of Awards.  This Plan is intended to constitute an
“unfunded” plan for Awards.

       

      (e)           Nonexclusivity
        of this Plan.  Neither the adoption of this Plan by the Board
        nor its submission to the stockholders of the Company for approval will be
        construed as creating any limitations on the power of the Board or a committee
        thereof to adopt such other incentive arrangements as it may deem desirable,
        including incentive arrangements and awards which do not qualify under section
        162(m) of the Code.  Nothing contained in this Plan will be construed
        to prevent the Company or any Subsidiary from taking any corporate action
        that
        is deemed by the Company or such Subsidiary to be appropriate or in its best
        interest, whether or not such action would have an adverse effect on this
        Plan
        or any Award made under this Plan. No employee, beneficiary or other person
        will
        have any claim against the Company or any Subsidiary as a result of any such
        action.

       

    

    (f)           
      Fractional Shares.  No fractional shares of Stock
      will be issued or delivered pursuant to the Stock Incentive Plan and any
      Award.  The Committee will determine whether cash, other Awards or
      other property will be issued or paid in lieu of such fractional shares or
      whether such fractional shares or any rights thereto will be forfeited or
      otherwise eliminated.

     

    (g)           Severability.  If
      any provision of this Plan is held to be illegal or invalid for any reason,
      the
      illegality or invalidity will not affect the remaining provisions of this Plan,
      but such provision will be fully severable and this Plan will be construed
      and
      enforced as if the illegal or invalid provision had never been included
      herein.  If any of the terms or provisions of this Plan conflict with
      the requirements of Rule 16b-3 (as those terms or provisions are applied to
      Eligible Persons who are subject to section 16(b) of the Exchange Act), then
      those conflicting terms or provisions will be deemed inoperative to the extent
      they so conflict with the requirements of Rule 16b-3 (unless the Board or the
      Committee, as appropriate, has expressly determined that this Plan or such
      Award
      should not comply with Rule 16b-3).  If any of the terms or provisions
      of this Plan conflict with the requirements of any applicable Listing
      Requirement or any applicable law, rule or regulation, then those conflicting
      terms or provisions will be deemed inoperative to the extent they so
      conflict.

     

    (h)           Governing
      Law.  All questions arising with respect to the provisions of
      this Plan and Awards will be determined by application of the laws of the State
      of Texas, without giving effect to any conflict of law provisions thereof,
      except to the extent Texas law is preempted by federal law.  The
      obligation of the Company to deliver Stock hereunder is subject to applicable
      federal and state laws and to the approval of any governmental authority
      required in connection with the authorization, issuance, or delivery of such
      Stock.

     

    (i)           
      Conditions to Delivery of Stock.  Nothing herein or
      in any Award granted hereunder or any Award agreement will require the Company
      to issue any shares with respect to any Award if that issuance would, in the
      opinion of counsel for the Company, constitute a violation of the Securities
      Act
      or any similar or superseding statute or statutes, any other applicable statute
      or regulation, or the rules of any applicable securities exchange or securities
      association, as then in effect.  At the time of delivery of any Stock
      upon settlement of an Award, the Company may, as a condition precedent to such
      delivery, require from the 

    

    
      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

    

     

    Participant (or in the event of the Participant’s death, from
      the Participant’s legal representatives, heirs, legatees or distributees) such
      written representations, if any, concerning the holder’s intentions with regard
      to the retention or disposition of the shares of Stock being acquired pursuant
      to the Award and such written covenants and agreements, if any, as to the manner
      of disposal of such shares as, in the opinion of counsel to the Company, may
      be
      necessary to ensure that any disposition by that holder (or in the event of
      the
      holder’s death, the holder’s legal representatives, heirs, legatees or
      distributees) will not involve a violation of the Securities Act or any similar
      or superseding statute or statutes, and any other applicable state or federal
      statute or regulation, or any rule of any applicable securities exchange or
      securities association, as then in effect.  No Stock will be
      deliverable unless and until the holder thereof has performed services for
      the
      Company or any of its Subsidiaries that the Committee believes is equal to
      or
      greater in value than the par value of the Stock deliverable to such Award.
      

     

    (j)    Plan
      Effective Date and Stockholder Approval.  This Plan was
      adopted by the Committee on January 16, 2007, was amended on April 16, 2007,
      and
      became effective as of January 1, 2007 upon approval by the stockholders of
      the
      Company at the annual meeting that occurred June 26, 2007.

     

    
      
        
        

      

      
        15Exhibit 10.1

VYYO INC.

FOURTH AMENDED AND
RESTATED

2000 EMPLOYEE AND CONSULTANT EQUITY INCENTIVE PLAN

Section
1.  General Purpose of Plan; Definitions.

The name of this
plan is the Vyyo Inc. Amended and Restated 2000 Employee and Consultant Equity
Incentive Plan (the “Plan”).  The Plan
was adopted by the Board (defined below) and approved by the stockholders of
the Company (defined below) on November 22, 1999.  The Board subsequently amended and restated
the Plan in its entirety on February 2, 2000 (the “First Amendment”), again
amended and restated the Plan on January 17, 2001 (the “Second Amendment”),
again amended  and restated the Plan on
January 20, 2005 (the “Third Amendment”) and again amended and restated the
Plan on March 15, 2007  (the “Fourth Amendment”,
and together with the First Amendment, the Second Amendment, and the Third
Amendment, the “Amendments”).  The
First Amendment was approved by the stockholders of the Company on February 2,
2000.  The Second Amendment was approved
by the stockholders of the Company on May 8, 2001.  The Third Amendment was approved by the
stockholders of the Company on March 14, 2005. 
The Fourth Amendment was approved by the stockholders of the Company on
May 10, 2007. The purpose of the Plan is to enable the Company to attract and
retain highly qualified personnel who will contribute to the Company’s success
and to provide incentives to Participants (defined below) that are linked
directly to increases in stockholder value and will therefore inure to the
benefit of all stockholders of the Company. 
The Company wishes the issuance of Awards (defined below) to its
employees in Israel to conform with the requirements of the Israeli Income Tax
Ordinance, and for this purpose the appended document Appendix A amends this
Plan to so conform.

For purposes of
the Plan, the following terms shall be defined as set forth below:

(a)           “Administrator”
means the Board, or if and to the extent the Board does not administer the
Plan, the Committee in accordance with Section 2 below.

(b)           “Affiliate”
means any corporation that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with,
another corpora­tion, where “control” (including the terms “controlled by” and “under
common control with”) means the possession, direct or indirect, of the power to
cause the direction of the manage­ment and policies of the corporation, whether
through the ownership of voting securities, by contract or otherwise.

(c)           “Award”
means any award under the Plan.

(d)           “Award
Agreement” means, with respect to each Award, the signed written agreement
between the Company and the Participant setting forth the terms and conditions
of the Award.

(e)           “Board”
means the Board of Directors of the Company.

(f)            “Code”
means the Internal Revenue Code of 1986, as amended from time to time, or any
successor thereto.

(g)           “Committee”
means any committee the Board may appoint to administer the Plan.  To the extent necessary and desirable, the
Committee shall be composed entirely of individuals who meet the qualifications
referred to in Section 162(m) of the Code and Rule 16b-3 under the Exchange
Act.  If at any time or to any extent the
Board shall not administer the Plan, then the functions of the Board specified
in the Plan shall be exercised by the Committee.

(h)           “Common
Stock” means the common stock, par value $0.0001 per share, of the Company.

(i)            “Company”
means Vyyo Inc., a Delaware corporation (or any successor corporation).

(j)            “Deferred
Stock” means the right to receive Shares at the end of a specified deferral
period granted pursuant to Section 8 below.

(k)           “Disability”
means the inability of a Participant to perform substantially his or her duties
and responsibilities to the Company or to any Parent or Subsidiary by reason of
a physical or mental disability or infirmity (i) for a continuous period of six
months, or (ii) at such earlier time as the Participant submits medical
evidence satisfactory to the Administrator that the Participant has a physical
or mental disability or infirmity that will likely prevent the Participant from
returning to the performance of the Participant’s work duties for six months or
longer.  The date of such Disability
shall be the last day of such six-month period or the day on which the Participant
submits such satisfactory medical evidence, as the case may be.

(l)            “Eligible
Recipient” means an officer, director, employee, consultant or advisor of
the Company or of any Parent or Subsidiary.

(m)          “Employee
Director” means any director of the Company who is also an employee of the
Company or of any Parent or Subsidiary.

(n)           “Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to
time.

(o)           “Exercise
Price” means the per share price at which a holder of an Award may purchase
the Shares issuable upon exercise of the Award.

(p)           “Fair
Market Value” as of a particular date shall mean the fair market value of a
share of Common Stock as determined by the Administrator in its sole
discretion; provided, however, that (i) if the Common Stock is
admitted to trading on a national securities exchange, fair market value of a
share of Common Stock on any date shall be the closing sale price reported for
such share on such exchange on such date or, if no sale was reported on such
date, on the last date preceding such date on 
such a sale was reported, (ii) if the Common Stock is admitted to
quotation on the National Association of Securities Dealers Automated Quotation
(“Nasdaq”) System or other comparable quotation system and has been designated
as a National Market System (“NMS”) security, fair market value of  a share of Common Stock on any date shall be
the closing sale price reported for such share on such system on such date or,
if no sale was reported on such date, on the last date preceding such date on
which a sale was reported, (iii) if the Common Stock is admitted to quotation
on the Nasdaq System but has not been designated as an NMS security, fair
market value of a share of Common Stock on any date shall be the average of the
highest bid and lowest asked prices of such share on such system on such date
or, if no bid and ask prices were reported on such date, on the last date
preceding such date on which both bid and ask prices were reported; (iv) in the
case of a Limited Stock Appreciation Right, the fair market value of a share of
Common Stock  shall be the “Change in
Control Price” (as defined in the Award Agreement evidencing such Limited Stock
Appreciation Right) of a share of Common Stock as of the date of exercise.

(q)           “Incentive
Stock Option” means any Option intended to be designated as an “incentive
stock option” within the meaning of Section 422 of the Code.

(r)            “Limited
Stock Appreciation Right” means a Stock Appreciation Right that can be
exercised only in the event of a “Change in Control” (as defined in the Award
Agreement evidencing such Limited Stock Appreciation Right).

(s)           “Non-Employee
Director”  means a director of the Company
who is not an employee of the Company or of any Parent or Subsidiary.

(t)            “Non-Qualified
Stock Option” means any Option that is not an Incentive Stock Option,
including any Option that provides (as of the time such Option is granted) that
it will not be treated as an Incentive Stock Option.

(u)           “Option”
means an option to purchase Shares granted pursuant to Section 6 below.

(v)           “Parent”
means any corporation (other than the Company) in an unbroken chain of
corporations ending with the Company, if each of the corporations in the chain
(other than the Company) owns stock possessing 50% or more of the combined
voting power of all classes of stock in one of the other corporations in the
chain.

(w)          “Participant”
means (i) any Eligible Recipient selected by the Administra­tor, pursuant to
the Administrator’s authority in Section 2 below, to receive grants of Options,
Stock Appreciation Rights, Limited Stock Appreciation Rights, awards of
Restricted Stock, Deferred Stock, or Performance Shares or any combination of
the foregoing, or (ii) any Non-Employee Director who is eligible to receive
grants of Options pursuant to Section 6(i) below.

(x)            “Performance
Shares” means Shares that are subject to restrictions based upon the
attainment of specified performance objectives granted pursuant to Section 8
below.

 2
 

(y)           “Registration
Statement” means the registration statement on Form S-1 filed with the
Securities and Exchange Commission for the initial underwritten public offering
of the Common Stock.

(z)            “Restricted
Stock” means Shares subject to certain restrictions granted pursuant to
Section 8 below.

(aa)         “Shares”
means shares of Common Stock reserved for issuance under the Plan, as adjusted
pursuant to Sections 3 and 4, and any successor security.

(bb)         “Stock
Appreciation Right” means the right pursuant to an Award granted under
Section 7 below to receive an amount equal to the excess, if any, of (i) the
Fair Market Value, as of the date such Stock Appreciation Right or portion
thereof is surrendered, of the Shares covered by such right or such portion
thereof, over (ii) the aggregate Exercise Price of such right or such portion
thereof.

(cc)         “Subsidiary”
means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company, if each of the corporations (other
than the last corporation) in the unbroken chain owns stock possessing 50% or
more of the total combined voting power of all classes of stock in one of the
other corporations in the chain.

Section
2.  Administration.

The Plan shall be
administered in accordance with the requirements of Section 162(m) of the Code
(but only to the extent necessary and desirable to maintain qualification of
Awards under the Plan under Section 162(m) of the Code) and, to the extent
applicable, Rule 16b-3 under the Exchange Act (“Rule 16b-3”), by the Board or,
at the Board’s sole discretion, by the Committee, which shall be appointed by
the Board, and which shall serve at the pleasure of the Board.

Pursuant to the
terms of the Plan, the Administrator shall have the power and authority to
grant to Eligible Recipients Options, Stock Appreciation Rights or Limited
Stock Appreciation Rights, Awards of Restricted Stock, Deferred Stock or
Performance Shares or any combination of the foregoing; provided, however,
that automatic, nondiscretionary grants of Options shall be made to
Non-Employee Directors pursuant to and in accordance with the terms of Section
6(i) below.  Except as otherwise provided
in Section 6(i) below, the Administrator shall have the authority:

(a)           to
select those Eligible Recipients who shall be Participants;

(b)           to
determine whether and to what extent Options, Stock Appreciation Rights,
Limited Stock Appreciation Rights, Awards of Restricted Stock, Deferred Stock
or Performance Shares or a combination of any of the foregoing, are to be
granted hereunder to Participants;

(c)           to determine
the number of Shares to be covered by each Award granted hereunder;

(d)           to
determine the terms and conditions, not inconsistent with the terms of the
Plan, of each Award granted hereunder (including, but not limited to, (i) the
restrictions applicable to Awards of Restricted Stock or Deferred Stock and the
conditions under which restrictions applicable to such Awards of Restricted
Stock or Deferred Stock shall lapse, and (ii) the performance goals and periods
applicable to Awards of Performance Shares);

(e)           to
determine the terms and conditions, not inconsistent with the terms of the
Plan, which shall govern all written instruments evidencing Options, Stock
Appreciation Rights, Limited Stock Appreciation Rights, Awards of Restricted
Stock, Deferred Stock or Performance Shares or any combination of the foregoing
granted hereunder;

(f)            to
reduce the Exercise Price of any Option to the then current Fair Market Value
if the Fair Market Value of the Shares covered by such Option has declined
since the date such Option was granted; and

(g)           the
Committee may, at any time or from time to time, authorize the Company, with
the consent of the respective Participants, to issue new Awards in exchange for
the surrender and cancellation of any or all outstanding Awards.  The Committee may at any time buy from a
Participant an Award previously granted with payment in cash, Shares (including
Restricted Stock) or other consideration, based on such terms and conditions as
the Committee and the Participant shall agree.

The Administrator
shall have the authority, in its sole discretion, to adopt, alter and repeal
such administrative rules, guidelines and practices governing the Plan as it
shall from time to time deem advisable; to interpret the terms and provisions
of the Plan and any Award issued under the Plan (and any Award Agreement
relating thereto); and to otherwise supervise the administration of the Plan.

 3
 

All decisions made
by the Administrator pursuant to the provisions of the Plan shall be final,
conclusive and binding on all persons, including the Company and the
Participants.

Section
3.  Shares Subject to Plan.

The total number
of shares of Common Stock reserved and available for issuance under the Plan
shall be 11,340,088 shares, plus an
annual increase to be added on the first day of the Company’s fiscal year
(beginning 2008) equal to the lesser of (i) 1,500,000 shares or (ii) ten
percent (10%) of the number of outstanding shares of Common Stock on the last
day of the immediately preceding fiscal year. 
Such shares may consist, in whole or in part, of authorized and unissued
shares or treasury shares.  The aggregate
number of Shares as to which Options, Stock Appreciation Rights, and Awards of
Restricted Stock, Deferred Stock and Performance Shares may be granted to any
Participant during any calendar year may not, subject to adjustment as provided
in this Section 3, exceed 80% of the Shares reserved for the purposes of the
Plan.

Consistent with
the provisions of Section 162(m) of the Code, as from time to time applicable,
to the extent that (i) an Option expires or is otherwise terminated without
being exercised, or (ii) any Shares subject to any Award of Restricted Stock,
Deferred Stock or Performance Shares granted hereunder are forfeited, such
Shares shall again be available for issuance in connection with future Awards
granted under the Plan.  If any Shares
have been pledged as collateral for indebtedness incurred by a Participant in
connection with the exercise of an Option and such Shares are returned to the
Company in satisfaction of such indebtedness, such Shares shall again be
available for issuance in connection with future Awards granted under the Plan.

In the event of
any stock dividend, recapitalization, stock split, reverse stock split,
subdivision, combination, reclassification or similar change in the capital
structure of the Company without consideration, an equitable substitution or
proportionate adjustment shall be made in (i) the aggregate number of Shares
reserved for issuance under the Plan, (ii) the kind, number and Exercise Prices
of Shares subject to outstanding Options, and (iii) the kind, number and
Exercise Prices of Shares subject to outstanding Awards of Restricted Stock,
Deferred Stock and Performance Shares, in each case as may be determined by the
Administrator, in its sole discretion, subject to any required action by the
Board or the stockholders of the Company and in compliance with applicable
securities laws; provided, however, that fractions of a Share
shall not be issued but shall either be paid in cash at Fair Market Value or
shall be rounded up to the nearest whole share, as determined by the
Committee.  An adjusted Exercise Price
shall also be used to determine the amount payable by the Company upon the
exercise of any Stock Apprecia­tion Right or Limited Stock Appreciation Right
related to any Option.

Section
4.  Corporate Transactions

(a)           Assumption or Replacement of
Awards by Successor.  In the event of
(i) a merger or consolidation in which the Company is not the surviving corporation
(other than a merger or consolidation with a wholly-owned subsidiary, a
reincorporation of the Company in a different jurisdiction, or other
transaction in which there is no substantial change in the stock­holders of the
Company and the Awards granted under the Plan are assumed or replaced by the
successor corporation, which assumption shall be binding on all Participants);
(ii) a dissolution or liquidation of the Company; (iii) the sale of
substantially all of the assets of the Company; or (iv) any other transaction
which qualifies as a “corporate transaction” under Section 424(a) of the Code
wherein the stockholders of the Company give up all of their equity interest in
the Company (except for the acquisition, sale or transfer of all or sub­stantially
all of the outstanding shares of the Company), any or all outstanding Awards
may be assumed or replaced by the successor corporation (if any) or Parent
thereof, which assumption or replace­ment shall be binding on all
Participants.  In the alternative, the
successor corporation or Parent thereof may substitute equivalent awards or
provide substantially similar consideration to Participants as was provided to
stockholders of the Company (after taking into account the existing provisions
of the Awards).  The successor
corporation or Parent thereof may also issue, in place of outstanding shares of
the Company held by the Participant, substantially similar shares or other
property subject to repurchase restrictions no less favorable to the
Participant.  In the event such successor
corporation (if any) or Parent thereof does not assume or substitute awards, as
provided above, pursuant to a transaction described in this Section 4(a), such
Awards shall automatically become fully vested and exercisable and be released
from any restrictions on transfer and repurchase or forfeiture rights,
immediately prior to the specified effective date of such transaction, for all
the Shares at the time represented by such Awards.  In such event, effective upon the consummation
of the transaction, or at such other time and on such conditions as the Board
shall determine, all outstanding Awards under the Plan shall terminate and
cease to remain outstanding, except to the extent assumed by the successor
corporation or its Parent.

(b)           Other Treatment of Awards.  Subject to any greater rights granted to
Participants under the foregoing provisions of this Section 4, in the event of
the occurrence of any transaction described in Section 4(a), any outstanding
Awards shall be treated as provided in the applicable Award Agreement or plan
of merger, consolidation, dissolution, liquidation, sale of assets or other “corporate
transaction.”

 4
 

(c)           Assumption of Awards by the
Company.  The Company, from time to
time, also may substitute or assume outstanding awards granted by another
company, whether in connection with an acquisition of such other company or
otherwise, by either (i) granting an Award under the Plan in substitution
of such other company’s award; or (ii) assuming such award as if it had
been granted under the Plan if the terms of such assumed award could be applied
to an award granted under the Plan.  Such
substitution or assumption shall be permissible if the holder of the
substituted or assumed award would have been eligible to be granted an Award
under the Plan if the other company had applied the rules of the Plan to such
grant.  In the event the Company assumes
an award granted by another company, the terms and conditions of such award shall
remain unchanged (except that the exercise price and the number and
nature of Shares issuable upon exercise of any such option will be adjusted
approximately pursuant to Section 424(a) of the Code).  In the event the Company elects to grant a
new Option rather than assuming an existing option, such new Option may be
granted with a similarly adjusted Exercise Price.

Section
5.  Eligibility.

Eligible
Recipients shall be eligible to be granted Options, Stock Appreciation Rights,
Limited Stock Appreciation Rights, Awards of Restricted Stock, Deferred Stock
or Performance Shares or any combination of the foregoing hereunder.  The Participants under the Plan shall be
selected from time to time by the Administrator, in its sole discretion, from
among the Eligible Recipients, and the Administrator shall determine, in its
sole discretion, the number of Shares covered by each such Award.

Section
6.  Options.

Options may be
granted alone or in addition to other Awards granted under the Plan.  Any Option granted under the Plan shall be in
such form as the Administrator may from time to time approve, and the
provisions of each Option need not be the same with respect to each
Participant.  Participants who are
granted Options shall enter into an Award Agreement with the Company, in such
form as the Administrator shall determine, which Award Agreement shall set
forth, among other things, the Exercise Price of the Option, the term of the
Option and provisions regarding exercisability of the Option granted
thereunder.

The Options
granted under the Plan may be of two types: (i) Incentive Stock Options and
(ii) Non-Qualified Stock Options.

The Administrator
shall have the authority to grant to any officer or employee of the Company or
of any Parent or Subsidiary (including directors who are also officers of the
Company) Incentive Stock Options, Non-Qualified Stock Options, or both types of
Options (in each case with or without Stock Appreciation Rights or Limited
Stock Appreciation Rights).  Directors
who are not also officers of the Company or of any Parent or Subsidiary,
consultants or advisors to the Company or to any Parent or Subsidiary may only
be granted Non-Qualified Stock Options (with or without Stock Appreciation
Rights or Limited Stock Appreciation Rights). 
To the extent that any Option does not qualify as an Incentive Stock
Option, it shall constitute a separate Non-Qualified Stock Option.  More than one Option may be granted to the
same Participant and be outstanding concurrently hereunder.

Options granted
under the Plan shall be subject to the following terms and conditions and shall
contain such additional terms and conditions, not inconsistent with the terms
of the Plan, as the Administrator shall deem desirable:

(a)           Option Exercise Price.  The per share Exercise Price of Shares
purchasable under an Option shall be determined by the Administrator in its
sole discretion at the time of grant but shall not, (i) in the case of
Incentive Stock Options, be less than 100% of the Fair Market Value of the
Common Stock on such date, (ii) in the case of Non-Qualified Stock Options
intended to qualify as “performance-based compensation” within the meaning of
Section 162(m) of the Code, be less than 100% of the Fair Market Value of the
Common Stock on such date and (iii) in any event, be less than the par value
(if any) of the Common Stock.  If a
Participant owns or is deemed to own (by reason of the attribution rules
applicable under Section 424(d) of the Code) more than 10% of the combined
voting power of all classes of stock of the Company or of any Parent or Subsidiary
and an Incentive Stock Option is granted to such Participant, the per share
Exercise Price of such Incentive Stock Option (to the extent required at the
time of grant by the Code shall be no less than 110% of the Fair Market Value
of the Common Stock on the date such Incentive Stock Option is granted.

(b)           Option Term.  The term of each Option shall be fixed by the
Administrator, but no Option shall be exercisable more than ten years after the
date such Option is granted; provided, however, that if an employee
owns or is deemed to own (by reason of the attribution rules of Section 424(d)
of the Code) more than 10% of the combined voting power of all classes of stock
of the Company or of any Parent or Subsidiary and an Incentive Stock Option is
granted to such employee, the term of such Incentive Stock Option (to the
extent required by the Code at the time of grant) shall be no more than five
years from the date of grant.

 5
 

(c)           Exercisability.  Options shall be exercisable at such time or
times and subject to such terms and conditions as shall be determined by the
Administrator at or after the time of grant. 
The Administrator may provide at the time of grant, in its sole
discretion, that any Option shall be exercisable only in installments, and the
Administrator may waive such install­ment exercise provisions at any time, in
whole or in part, based on such factors as the Adminis­trator may determine, in
its sole discretion, including but not limited to in connection with any “change
in control” of the Company (as defined in the Award Agreement evidencing such
Option).

(d)           Method of Exercise.  Subject to Section 6(c), Options may be
exercised in whole or in part at any time during the Option period, by giving
written notice of exercise to the Company specifying the number of Shares to be
purchased, accompanied by payment in full of the aggregate Exercise Price of
the Shares so purchased in cash or its equivalent, as determined by the
Administrator.  In addition, payment for
Shares purchased pursuant to the Plan may be made, where expressly approved for
the Participant by the Committee and where permitted by law:

(i)            by cancellation of indebtedness of
the Company to the Partici­pant;

(ii)           by surrender of shares of Common
Stock that either (1) have been owned by Participant for more than six (6)
months and have been paid for within the meaning of SEC Rule 144 (and, if such
shares were purchased from the Company by use of a promissory note, such note
has been fully paid with respect to such Shares); or (2) were obtained by
Participant in the public market;

(iii)          by waiver of compensation due or
accrued to Participant for services rendered;

(iv)          by tender of property;

(v)           with respect only to purchases upon
exercise of an Option, and provided that a public market for the Common Stock
exists: (i) through a “same day sale” commitment from Participant and a
broker-dealer that is a member of the National Association of Securities
Dealers (an “NASD Dealer”) whereby the Participant irrevocably elects to
exercise the Option and to sell a portion of the Shares so purchased to pay for
the aggregate Exercise Price of the Shares so purchased, and whereby the NASD
Dealer irrevocably commits upon receipt of such Shares to forward such Exercise
Price directly to the Company; or (ii) through a “margin” commitment from
Participant and an NASD Dealer whereby Participant irrevocably elects to
exercise the Option and to pledge the Shares so purchased to the NASD Dealer in
a margin account as security for a loan from the NASD Dealer in the amount of
the aggregate Exercise Price of the Shares so purchased, and whereby the NASD
Dealer irrevocably commits upon receipt of such Shares to forward such Exercise
Price directly to the Company;

(vi)          in
the case of the exercise of a Non-Qualified Stock Option, in the form of
Restricted Stock or Performance Shares subject to an Award hereun­der (based,
in each case, on the Fair Market Value of the Common Stock on the date the
Option is exercised); provided, however, that in the case of an
Incentive Stock Option, the right to make payment in the form of already owned
shares of Common Stock may be authorized only at the time of grant.  If payment of the Exercise Price of a
Non-Qualified Stock Option is made in whole or in part in the form of
Restricted Stock or Performance Shares, the Shares received upon the exercise
of such Option shall be restricted in accordance with the original terms of the
Restricted Stock Award or Performance Shares Award in question, except that the
Administrator may direct that such restrictions shall apply only to that number
of Shares equal to the number of shares surrendered upon the exercise of such
Option.

(vii)         by any combination of the foregoing or

(viii)        by any other form of consideration
permitted by applicable law.

A Participant
shall generally have the rights to dividends and any other rights of a
stockholder with respect to the Shares subject to the Option only after the
Participant has given written notice of exercise, has paid in full for such
Shares, and, if requested, has given the representation described in Section
11(b).

The Administrator
may require the surrender of all or a portion of any Option granted under the
Plan as a condition precedent to the grant of a new Option.  Subject to the provisions of the Plan, such
new Option shall be exercisable at the Exercise Price, during such period and
on such other terms and conditions as are specified by the Administrator at the
time the new Option is granted. 
Consistent with the provisions of Section 162(m), to the extent
applicable, upon their surrender, 

 6
 

Options shall be
canceled and the Shares previously subject to such canceled Options shall again
be available for future grants of Options and other Awards hereunder.

(e)           Loans.  The Company or any Parent or Subsidiary may
make loans available to Option holders in connection with the exercise of
outstanding Options, as the Administrator, in its sole discretion, may
determine.  Such loans shall (i) be
evidenced by promissory notes entered into by the Option holders in favor of
the Company or any Parent or Subsidiary, (ii) be subject to the terms and
conditions set forth in this Section 6(e) and such other terms and conditions,
not inconsistent with the Plan, as the Administrator shall determine, (iii)
bear interest at the applicable Federal interest rate or such other rate as the
Administrator shall determine, and (iv) be subject to Board approval (or to
approval by the Administrator to the extent the Board may delegate such
authority).  In no event may the
principal amount of any such loan exceed the sum of (x) the aggregate Exercise
Price less the par value (if any) of the Shares covered by the Option, or
portion thereof, exercised by the holder, and (y) any Federal, state, and local
income tax attributable to such exercise. 
The initial term of the loan, the schedule of payments of principal and
interest under the loan, the extent to which the loan is to be with or without
recourse against the holder with respect to principal and/or interest and the
conditions upon which the loan will become payable in the event of the holder’s
termination of service to the Company or to any Parent or Subsidiary shall be
determined by the Administrator.  Unless
the Administrator determines otherwise, when a loan is made, Shares having an aggregate
Fair Market Value at least equal to the principal amount of the loan shall be
pledged by the holder to the Company as security for payment of the unpaid
balance of the loan, and such pledge shall be evidenced by a pledge agreement,
the terms of which shall be determined by the Administrator, in its sole
discretion; provided, however, that each loan shall comply with
all applicable laws, regulations and rules of the Board of Governors of the
Federal Reserve System and any other governmental agency having jurisdiction.

(f)            Non-Transferability of Options.  Except under the laws of descent and
distribution, the Participant shall not be permitted to sell, transfer, pledge
or assign any Option, and all Options shall be exercisable, during the
Participant’s lifetime, only by the Participant; provided, however,
that the Participant shall be permitted to transfer one or more Non-Qualified
Stock Options to a trust controlled by the Participant during the Participant’s
lifetime for estate planning purposes.

(g)           Termination of Employment or
Service.  If a Participant’s
employment with or service as a director, consultant or advisor to the Company
or to any Parent or Subsidiary terminates by reason of his or her death,
Disability or for any other reason, the Option may thereafter be exercised to
the extent provided in the Award Agreement evidencing such Option, or as
otherwise determined by the Administrator.

(h)           Annual Limit on Incentive Stock
Options.  To the extent that the
aggregate Fair Market Value (determined as of the date the Incentive Stock
Option is granted) of Shares with respect to which Incentive Stock Options
granted to a Participant under this Plan and all other option plans of the
Company or of any Parent or Subsidiary become exercisable for the first time by
the Participant during any calendar year exceeds $100,000 (as determined in
accordance with Section 422(d) of the Code), the  portion
of such Incentive Stock Options in excess of $100,000 shall be treated as
Non-Qualified Stock Options.

(i)            Automatic Grants of Options to
Non-Employee Directors. The Company shall grant Non-Qualified Stock Options
to Non-Employee Directors pursuant to this Section 6(i), which grants shall be
automatic and nondiscretionary and otherwise subject to the terms and conditions
set forth in this subsection (i) and the terms of the Plan (the “Automatic
Non-Employee Director Options”).  Each
Non-Employee Director who first becomes a director of the Company following the
Effective Date (as defined in Section 12) shall be automatically granted a
Non-Qualified Stock Option to purchase 25,000 Shares (an “Initial Option”).  Each Non-Employee Director shall be
automatically granted a Non-Qualified Stock Option to purchase 7,500 Shares
(the “Annual Options”) on the date of the Company’s annual meeting of
stockholders; provided, however, that he or she is then a
director of the Company and, provided, further, that as of such
date, such director shall have served on the Board for at least the preceding
six (6) months.

The term of each Automatic
Non-Employee Director Option shall be ten (10) years, and the Exercise Price
purchasable under an Automatic Non-Employee Director Option shall be no less
than 100% of the Fair Market Value of the Common Stock on the date of grant, provided,
however, in no event shall the Exercise Price purchasable under an
Automatic Non-Employee Director Option be less than the par value (if any) of
the Common Stock.  The Initial Options
shall vest and become exercisable in four equal annual installments on each of
the first four anniversaries of the date of grant.  The Annual Options shall be 100% vested and
fully exercisable as of the date of grant.

In the event that
the number of Shares available for grant under the Plan is not sufficient to
accommodate the Automatic Non-Employee Director Options, then the remaining
Shares available for Automatic Non-Employee Director Options shall be granted
to Non-Employee Directors on a pro-rata basis. 
No further grants shall be made until such time, if any, as additional
Shares become available for grant under the Plan through action of the Board
and/or the stockholders of the Company to increase 

 7
 

the number of Shares that may be issued under the Plan
or through cancellation or expiration of Awards previously granted hereunder.

Section
7.  Stock Appreciation Rights and Limited
Stock Appreciation Rights.

Stock Appreciation
Rights and Limited Stock Appreciation Rights may be granted either alone (“Free
Standing Rights”) or in conjunction with all or part of any Option granted under
the Plan (“Related Rights”).  In the case
of a Non-Qualified Stock Option, Related Rights may be granted either at or
after the time of the grant of such Option. 
In the case of an Incentive Stock Option, Related Rights may be granted
only at the time of the grant of the Incentive Stock Option.  The Administrator shall determine the
Eligible Recipients to whom, and the time or times at which, grants of Stock
Appreciation Rights or Limited Stock Appreciation Rights shall be made; the
number of Shares to be awarded, the Exercise Price (or, in the case of a
Limited Stock Appreciation Right, the “Change in Control” price), and all other
conditions of Stock Appreciation Rights and Limited Stock Appreciation
Rights.  The provisions of Stock Apprecia­tion
Rights and Limited Stock Appreciation Rights need not be the same with respect
to each Participant.

Stock Appreciation
Rights and Limited Stock Appreciation Rights granted under the Plan shall be
subject to the following terms and conditions and shall contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the
Administrator shall deem desirable:

(a)           Awards. The prospective
recipient of a Stock Appreciation Right or Limited Stock Appreciation Right
shall not have any rights with respect to such Award, unless and until such
recipient has executed an Award Agreement evidencing the Award (a “Stock
Appreciation Right Agreement” or “Limited Stock Appreciation Right Agreement,”
as appropriate) and delivered a fully executed copy thereof to the Company,
within a period of sixty days (or such other period as the Administrator may
specify) after the award date. 
Participants who are granted Stock Appreciation Rights or Limited Stock
Appreciation Rights shall have no rights as stockholders of the Company with
respect to the grant or exercise of such rights.

(b)           Exercisability.

(i)            Stock Appreciation Rights that are
Free Standing Rights (“Free Standing Stock Appreciation Rights”) shall be
exercisable at such time or times and subject to such terms and conditions as
shall be determined by the Adminis­trator at or after grant; provided, however,
that no Free Standing Stock Apprecia­tion Right shall be exercisable during the
first six months of its term, except that this additional limitation shall not
apply in the event of a Participant’s death or Disability prior to the
expiration of such six-month period.

(ii)           Stock Appreciation Rights that are
Related Rights (“Related Stock Appreciation Rights”) shall be exercisable only
at such time or times and to the extent that the Options to which they relate
shall be exercisable in accordance with the provisions of Section 6 above and
this Section 7 of the Plan; provided, however, that a Related
Stock Appreciation Right granted in connection with an Incentive Stock Option
shall be exercisable only if and when the Fair Market Value of the Common Stock
subject to the Incentive Stock Option exceeds the Exercise Price of such
Option; provided, further, that no Related Stock Apprecia­tion
Right shall be exercisable during the first six months of its term, except that
this additional limitation shall not apply in the event of a Participant’s
death or Disability prior to the expiration of such six-month period.

(iii)          Limited Stock Appreciation Rights
shall only be exercised within the 30-day period following a “Change in Control”
(as defined by the Administrator in the Limited Stock Appreciation Right
Agreement evidencing such right) and, with respect to Limited Stock
Appreciation Rights that are Related Rights (“Related Limited Stock
Appreciation Rights”), only to the extent that the Options to which they relate
shall be exercisable in accordance with the provisions of Section 6 above and
this Section 7 of the Plan.

 8
 

(c)           Payment Upon Exercise.

(i)            Upon the exercise of a Free Standing
Stock Appreciation Right, the Participant shall be entitled to receive up to,
but not more than, an amount in cash or that number of Shares (or any
combination of cash and Shares) equal in value to the excess of the Fair Market
Value as of the date of exercise over the per share Exercise Price specified in
the Free Standing Stock Appreciation Right (which Exercise Price shall be no
less than 100% of the Fair Market Value of the Common Stock on the date of
grant) multiplied by the number of Shares in respect of which the Free Standing
Stock Appreciation Right is being exercised, with the Administrator having the
right to determine the form of payment.

(ii)           A Related Right may be exercised by a
Participant by surren­dering the applicable portion of the related Option.  Upon such exercise and surrender, the
Participant shall be entitled to receive up to, but not more than, an amount in
cash or that number of Shares (or any combination of cash and Shares) equal in
value to the excess of the Fair Market Value as of the date of exercise over
the per share Exercise Price specified in the related Option multiplied by the
number of Shares in respect of which the Related Stock Appreciation Right is
being exercised, with the Administrator having the right to determine the form
of payment.  Options which have been so
surrendered, in whole or in part, shall no longer be exercisable to the extent
the Related Rights have been so exercised.

(iii)          Upon the exercise of a Limited Stock
Appreciation Right, the Participant shall be entitled to receive an amount in
cash equal in value to the excess of the “Change in Control Price” (as defined
in the Award Agreement evidencing such Limited Stock Appreciation Right) of a
share of Common Stock Share as of the date of exercise over (A) the per share
Exercise Price specified in the related Option, or (B) in the case of a Limited
Stock Appreciation Right which is a Free Standing Stock Appreciation Right, the
per share Exercise Price speci­fied in the Free Standing Stock Appreciation
Right, such excess to be multiplied by the number of Shares in respect of which
the Limited Stock Appreciation Right shall have been exercised.

(d)           Non-Transferability.

(i)            Free Standing Stock Appreciation
Rights shall be transferable only when and to the extent that an Option would
be transferable under Section 6(f) of the Plan.

(ii)           Related Stock Appreciation Rights
shall be transferable only when and to the extent that the underlying Option
would be transferable under Section 6(f) of the Plan.

(iii)          Limited Stock Appreciation Rights
shall be transferable only when and to the extent that an Option would be
transferable under Section 6(f) of the Plan.

(e)           Termination of Employment or
Service

(i)            In the event of the termination of
employment or service of a Participant who has been granted one or more Free
Standing Stock Appreciation Rights, such rights shall be exercisable at such
time or times and subject to such terms and conditions as shall be determined
by the Administrator at or after grant.

(ii)           In the event of the termination of
employment or service of a Participant who has been granted one or more Related
Stock Appreciation Rights, such rights shall be exercisable at such time or
times and subject to such terms and conditions as set forth in the related
Options.

(iii)          In the event of the termination of
employment or service of a Participant who has been granted one or more Limited
Stock Appreciation Rights, such rights shall be exercisable at such time or
times and subject to such terms and conditions as shall be determined by the
Administrator at or after grant.

(f)            Term.

(i)            The term of each Free Standing Stock
Appreciation Right shall be fixed by the Administrator, but no Free Standing
Stock Appreciation Right shall be exercisable more than ten years after the
date such right is granted.

(ii)           The term of each Related Stock
Appreciation Right shall be the term of the Option to which it relates, but no
Related Stock Appreciation Right shall be exercisable more than ten years after
the date such right is granted.

 9
 

(iii)          The term of each Limited Stock
Appreciation Right shall be fixed by the Administrator, but no Limited Stock
Appreciation Right shall be exercisable more than ten years after the date such
right is granted.

Section
8.  Restricted Stock, Deferred Stock and
Performance Shares.

Awards of
Restricted Stock, Deferred Stock or Performance Shares may be issued either
alone or in addition to other Awards granted under the Plan.  The Adminis­trator shall determine the
Eligible Recipients to whom, and the time or times at which, Awards of
Restricted Stock, Deferred Stock or Performance Shares shall be made; the
number of Shares to be awarded; the Exercise Price, if any, to be paid by the
Participant for the acquisition of Restricted Stock, Deferred Stock or
Performance Shares; the Restricted Period (as defined in Section 8(b))
applicable to Awards of Restricted Stock or Deferred Stock; the performance
objectives applicable to Awards of Deferred Stock or Performance Shares; and
all other conditions of the Awards of Restricted Stock, Deferred Stock and
Performance Shares.  Subject to the
requirements of Section 162(m) of the Code, as applicable, the Administrator
may also condition the grant of the Award of Restricted Stock, Deferred Stock or
Performance Shares upon the exercise of Options, or upon such other criteria as
the Administrator may determine, in its sole discretion.  The provisions of the Awards of Restricted
Stock, Deferred Stock or Performance Shares need not be the same with respect
to each Participant.  In the sole
discretion of the Administrator, loans may be made to Participants in
connection with the purchase of Restricted Stock under substantially the same
terms and conditions as provided in Section 6(e) of the Plan with respect to
the exercise of Options.

(a)           Awards and Certificates.  The prospective recipient of Awards of
Restricted Stock, Deferred Stock or Performance Shares shall not have any
rights with respect to any such Award, unless and until such recipient has executed
an Award Agreement evidencing the Award (a “Restricted Stock Award Agreement,” “Deferred
Stock Award Agreement” or “Performance Shares Award Agreement,” as appropriate)
and delivered a fully executed copy thereof to the Company, within a period of
sixty days (or such other period as the Administrator may specify) after the
award date.  Except as otherwise provided
below in Section 8(b), (i) each Participant who is granted an Award of
Restricted Stock or Performance Shares shall be issued a stock certificate in
respect of such shares of Restricted Stock or Performance Shares; and (ii) such
certificate shall be registered in the name of the Participant, and shall bear
an appropriate legend referring to the terms, conditions, and restrictions
applicable to any such Award.

The Company may
require that the stock certificates evidencing Restricted Stock or Performance
Shares granted hereunder be held in the custody of the Company until the
restrictions thereon shall have lapsed, and that, as a condition of any Award
of Restricted Stock or Performance Shares, the Participant shall have delivered
a stock power, endorsed in blank, relating to the Shares covered by such Award.

With respect to
Awards of Deferred Stock, at the expiration of the Restricted Period, stock
certificates in respect of such Shares of Deferred Stock shall be delivered to
the Participant, or his legal representative, in a number equal to the number
of Shares covered by the Deferred Stock Award.

(b)           Restrictions and Conditions.  The Awards of Restricted Stock, Deferred
Stock and Performance Shares granted pursuant to this Section 8 shall be
subject to the following restrictions and conditions:

(i)            Subject to the provisions of the
Plan and the Restricted Stock Award Agreement, Deferred Stock Award Agreement
or Performance Shares Award Agreement, as appropriate, governing any such
Award, during such period as may be set by the Administrator commencing on the
date of grant (the “Re­stricted Period”), the Participant shall not be
permitted to sell, transfer, pledge or assign shares of Restricted Stock,
Deferred Stock or Performance Shares awarded under the Plan; provided, however,
that the Administrator may, in its sole discre­tion, provide for the lapse of
such restrictions in installments and may accelerate or waive such restrictions
in whole or in part based on such factors and such circumstances as the
Administrator may determine, in its sole discretion, includ­ing, but not
limited to, the attainment of certain performance related goals, the Participant’s
termination of employment or service as a director, consultant or advisor to
the Company or any Parent or Subsidiary, the Participant’s death or Disability
or the occurrence of a “change in control” as defined in the Restricted Stock
Award Agreement, Deferred Stock Award Agreement or Performance Shares Award
Agreement, as appropriate, evidencing such Award.

(ii)           Except as provided in Section
8(c)(i), the Participant shall generally have the rights of a stockholder of
the Company with respect to Re­stricted Stock or Performance Shares during the
Restricted Period.  The Partici­pant
shall generally not have the rights of a stockholder with respect to Shares
subject to Awards of Deferred Stock during the Restricted Period; provided,
however, that dividends declared during the Restricted Period with
respect to the number of Shares covered by Awards of Deferred Stock shall be
paid to the Participant.  Certificates
for unrestricted Shares shall be delivered to the Partici­pant promptly after,
and only after, the Restricted Period shall expire without 

 10
 

forfeiture in
respect of such Awards of Restricted Stock, Deferred Stock or Performance
Shares except as the Administrator, in its sole discretion, shall otherwise
determine.

(iii)          The rights of Participants granted
Awards of Restricted Stock, Deferred Stock or Performance Shares upon
termination of employment or service as a director, consultant or advisor to
the Company or to any Parent or Subsidiary terminates for any reason during the
Restricted Period shall be set forth in the Restricted Stock Award Agreement,
Deferred Stock Award Agreement or Performance Shares Award Agreement, as
appropriate, governing such Awards.

Section
9.  Amendment and Termination.

The Board may
amend, alter or discontinue the Plan, but no amendment, alteration, or
discontinuation shall be made that would impair the rights of a Participant
under any Award theretofore granted without such Participant’s consent, or
that, without the approval of the stockholders (as described below), would:

(a)           except as provided in Section 3 of
the Plan, increase the total number of Shares reserved for issuance under the
Plan;

(b)           change the class of officers,
directors, employees, consultants and advisors eligible to participate in the
Plan; or

(c)           extend the maximum Option period
under Section 6(b) of the Plan.

Notwithstanding
the foregoing, stockholder approval under this Section 9 shall only be required
at such time and under such circumstances as stockholder approval would be
required under Section 162(m) of the Code or other applicable law, rule or
regulation with respect to any material amendment to an employee benefit plan
of the Company.

The Administrator
may amend the terms of any Award theretofore granted, prospectively or
retroactively, but, subject to Section 3 of Plan, no such amendment shall
impair the rights of any Participant without his or her consent.

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

Section
11.  General Provisions.

(a)           Shares shall not be issued pursuant
to the exercise of any Award granted hereunder unless the exercise of such
Award and the issuance and delivery of such Shares pursuant thereto shall
comply with all relevant provisions of law, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act and the requirements of
any stock exchange upon which the Common Stock may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

(b)           The Administrator may require each
person acquiring Shares to represent to and agree with the Company in writing
that such person is acquiring the Shares without a view to distribution
thereof.  The certificates for such
Shares may include any legend which the Adminis­trator deems appropriate to
reflect any restrictions on transfer.

All certificates
for Shares delivered under the Plan shall be subject to such stock-transfer
orders and other restrictions as the Administrator may deem advisable under the
rules, regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which the Common Stock is then listed, and
any applicable Federal or state securities law, and the Administrator may cause
a legend or legends to be placed on any such certificates to make appropriate
reference to such restrictions.

(c)           Nothing contained in the Plan shall
prevent the Board from adopting other or additional compensation arrangements,
subject to stockholder approval, if such approval is required; and such arrangements
may be either generally applicable or applicable only in specific cases.  The adoption of the Plan shall not confer
upon any Eligible Recipient any right to continued employment or service with
the Company or any Parent or Subsidiary, as the case may be, nor shall it
interfere in any way with the right of the Company or any Parent or Subsidiary
to terminate the employment or service of any of its Eligible Recipients at any
time.

 11
 

(d)           Each Participant shall, no later than
the date as of which the value of an Award first becomes includible in the
gross income of the Participant for Federal income tax purposes, pay to the
Company, or make arrangements satisfactory to the Administrator regarding
payment of, any Federal, state, or local taxes of any kind required by law to
be withheld with respect to such Award. 
The obligations of the Company under the Plan shall be conditional on
the making of such payments or arrangements, and the Company shall, to the
extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to the Participant.

(e)           No member of the Board or the
Administrator, nor any officer or employee of the Company acting on behalf of
the Board or the Administrator, shall be personally liable for any action,
determination, or interpretation taken or made in good faith with respect to
the Plan, and all members of the Board or the Administrator and each and any
officer or employee of the Company acting on their behalf shall, to the extent
permitted by law, be fully indemnified and protected by the Company in respect
of any such action, determination or interpretation.

Section
12.  Stockholder Approval; Effective Date
of Plan; Effective Date of Amendments.

(a)           The grant of any Award hereunder
shall be contingent upon stockholder approval of the Plan being obtained within
12 months before or after the date the Board adopts the Plan.

(b)           Subject to the approval of the Plan
by the stockholders of the Company within twelve (12) months before or after
the date the Plan is adopted by the Board, the Plan shall be effective as of
November 22, 1999.

(c)           Subject to the approval of the
Amendments by the stockholders of the Company within twelve (12) months before
or after the date the Amendments are adopted by the Board, the Amendments to
the Plan shall be effective as of the first trading day on or after the date on
which the Securities and Exchange Commission declares the Company’s
Registration Statement effective (the “Effective Date”).

Section
13.  Term of Plan.

No Option, Stock
Appreciation Right, Limited Stock Appreciation Right, or Awards of Restricted
Stock, Deferred Stock or Performance Shares shall be granted pursuant to the
Plan on or after November 22, 2009, but Awards theretofore granted may extend
beyond that date.

 12

APPENDIX
A

TO THE

VYYO INC.

FOURTH AMENDED AND RESTATED 2000 EMPLOYEE AND CONSULTANT

EQUITY INCENTIVE PLAN

1.                                       General

1.1.                              This
appendix (the “Appendix”) is intended to enable the Company to issue Awards in
compliance with Amendment no. 132 of the Ordinance (as defined below) and in
particular with the provisions of Section 102 and Section 3(i) of the
Ordinance, as amended or replaced from time to time.

1.2.                              Any
capitalized term not specifically defined in this Appendix shall have such
meaning as is ascribed to it in the Vyyo Inc Fourth Amended and Restated 2000
Employee and Consultant Equity Incentive Plan (hereinafter, the “Plan”) and shall be construed
according  to the interpretation given to
it in the Plan.

1.3.                              The
provisions of this Appendix shall apply only to Participants who are residents
of the state of Israel or those who are deemed to be residents of the state of
Israel for the payment of tax.

1.4.                              The
Plan and this Appendix are complementary to each other and shall be deemed a
single integrated document. Except as otherwise set forth herein, the terms and
conditions of the Plan shall remain unchanged and in full force and effect, and
shall govern the grant of Awards to Israeli Employees and to Israeli
Non-Employees (as such terms are defined below).

1.5.                              In
the event of any inconsistencies or conflicting provisions between the
provisions of the Plan and the provisions of this Appendix, whether explicit or
implied, the provisions of this Appendix shall prevail.

2.                                       Definitions

2.1.                              “3(i) Award” means an Award granted pursuant
to Section 3(i) of the Ordinance to any person who is an Israeli Non-Employee.

2.2.                              “102 Award” means an Award granted pursuant
to Section 102 of the Ordinance to any person who is an Israeli Employee.

2.3.                              “102 Capital Gain Awards  (102 CGA)” means a Trustee 102 Award
elected and designated by the Employing Company to qualify for capital gain tax
treatment in accordance with the provisions of Section 102(b)(2) of the
Ordinance.

2.4.                              “102 Ordinary Income Award (102 OIA)” means
a Trustee 102 Award elected and designated by the Employing Company to qualify
for ordinary income tax treatment in accordance with the provisions of Section
102(b)(1) of the Ordinance.

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

2.6.                              “Employing Company” shall have the meaning
ascribed to it in Section 102(a) of the Ordinance.

2.7.                              “Israeli Employee” means a person who is a
resident of the state of Israel or who is deemed to be a resident of the state
of Israel for the payment of tax, and who is an employee or an Office Holder (“Nose Missra”) of the Company, or any
Parent or Subsidiary of the Company, in each case excluding a person who is a
Controlling Shareholder prior to the issuance of the relevant Award or as a
result thereof.

2.8.                              “Israeli Non-Employee” means a person who is
a resident of the state of Israel or who is deemed to be a resident of the
state of Israel for the payment of tax, and who is (i) a consultant, adviser,
service provider of the Company, or any Parent or Subsidiary of the Company,
who is not an Israeli Employee, or (ii) a Controlling Shareholder (whether or
not an employee of the Company or any Parent or Subsidiary thereof).

2.9.                              “ITA” means the Israeli Income Tax
Authorities.

2.10.                        “Non-Trustee 102 Award” means an Award granted to an Israeli
Employee pursuant to Section 102(c) of the Ordinance, which is not required to
be held in trust by a Trustee.

2.11.                        “Ordinance” means the 1961 Israeli Income Tax Ordinance [New
Version], as now in effect or as amended or replaced from time to time.

 13
 

2.12.                        “Section  102”
means section 102 of the Ordinance and any regulations, rules, orders or
procedures promulgated thereunder as now in effect or as amended or replaced
from time to time.

2.13.                        “Trustee” means any person or entity appointed by the Company,
any of its Parents or any of its Subsidiaries, as applicable and approved by
the ITA, to serve as a trustee, all in accordance with the provisions of
Section 102(a) of the Ordinance.

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

3.                                       Issuance of Awards

3.1.                              Without
derogating from the provisions of the Plan: (i) Israeli Employees may be
granted only 102 Awards; and (ii) Israeli Non-Employees may be granted only
3(i) Awards. In each case, such Awards shall be subject to the terms and
conditions of the Ordinance.

3.2.                              The
Employing Company may designate 102 Awards granted to Israeli Employees
pursuant to Section 102 as Non-Trustee 102 Awards or as Trustee 102 Awards.

4.                                       Trustee 102 Awards

4.1.                              Awards
granted pursuant to this Section 4 are intended to constitute Trustee 102
Awards and are subject to the provisions of Section 102 and the general terms
and conditions specified in the Plan, except for such provisions of the Plan
applying to Awards under a different tax law or regulation.

4.2.                              Trustee
102 Awards may be granted only to Israeli Employees.

4.3.                              Trustee
102 Awards shall be classified as either 102 CGA or 102 OIA, subject to the
terms and conditions of Section 102 and the provisions of the Plan and this
Appendix.

4.4.                              No
Trustee 102 Awards may be granted under this Appendix, unless and until the
Employing Company’s election of the type of Trustee 102 Awards granted to
Israeli Employees, 102 CGA or 102 OIA (the “Election”), is appropriately filed
with the ITA.

After making an Election, the Company may grant only
the type of Trustee 102 Awards it has elected (i.e. 102 CGA or 102 OIA), and
the Election shall apply to all grants to Participants of Trustee 102 Awards
until such Election is changed pursuant to the provisions of Section 102(g) of
the Ordinance.  The Employing Company may
change such Election only after the passage of at least one year following the
end of the year during which the applicable Employing Company first granted
Trustee 102 Awards in accordance with the previous Election.

For the avoidance
of doubt, such Election shall not prevent the Company from granting Non-Trustee
102 Awards or 3(i) Awards simultaneously with the grant of Trustee 102 Awards.

4.5.                              The
grant of Trustee 102 Awards shall be conditioned upon the approval (or the
deemed approval pursuant to the provisions of section 102(a) of the Ordinance)
of the Plan, this Appendix and the Trustee by the ITA.

4.6.                              Trustee
102 Awards may be granted only after the passage of thirty days (or a shorter
period as and if approved by the ITA) following the delivery by the appropriate
Employing Company to the ITA of a request for approval of the Plan (including
this Appendix) and the Trustee according to Section 102.

Notwithstanding the
foregoing paragraph, if within ninety (90) days of delivery of the
abovementioned request, the appropriate ITA officer notifies the Employing Company
of his or her decision not to approve the Plan or the Trustee, the Awards that
were intended to be granted as a Trustee 102 Awards shall be deemed to be
Non-Trustee 102 Awards, unless otherwise determined by the ITA officer.

4.7.                              Anything
herein to the contrary notwithstanding, all Trustee 102 Awards granted under
this Plan shall be granted or issued to a Trustee. The Trustee shall hold each
such Trustee 102 Award, all Shares issued upon exercise thereof, and all other
securities received following any exercise or realization of rights, including
bonus shares, in trust for the benefit of the Participant in respect of whom
such Award was granted. All certificates representing Awards or Shares issued
to the Trustee under the Plan shall be deposited with the Trustee, and shall be
held by the Trustee until such time that such Awards or Shares are released
from the trust.

4.8.                              With
respect to 102 CGA and 102 OIA, the Awards or Shares issued upon the exercise
thereof and all rights related to them, including bonus shares, will be held by
the Trustee for such period of time as required under Section 102 (currently,
at least 24 months (in case of a 102 CGA) and 12 months (in case of a 102 OIA),
from the end of the tax year in which such Award was deposited with the
Trustee) or a shorter period as approved by the ITA (hereinafter, the “Holding Period”), under the terms set forth
in Section 102.

 14
 

4.9.                              In
accordance with Section 102, the Participant shall not sell, cause the release
from trust, or otherwise dispose of, any Trustee 102 Award, any Share issued
upon the exercise thereof, or any rights related to them, including bonus
shares, until the end of the applicable Holding Period.  Notwithstanding the foregoing but without
derogating from the provisions of the Plan and the terms and conditions set
forth in the Award Agreement, if any such sale, release, or disposition occurs
during the Holding Period, then the provision of Section 102, relating to
non-compliance with the Holding Period, will apply and all sanctions under
Section 102 shall be borne by the Participant.

4.10.                        Anything herein to the contrary
notwithstanding, the Trustee shall not release any Awards which were not
already exercised into Shares by the Participant, nor release any Shares issued
upon exercise of the Trustee 102 Awards or rights related thereto, including
bonus shares, prior to the full payment of the Exercise Price and Participant’s
tax liability arising from the Trustee 102 Awards which were granted to him or
her.

4.11.                        In the event that the
requirements for the Trustee 102 Awards are not met, then the Trustee 102
Awards shall be regarded as Non-Trustee 102 Awards.

4.12.                        Upon receipt of a Trustee 102
Award, the Participant will sign an Award Agreement under which such
Participant will agree to be subject to the trust agreement between the Company
and/or its Subsidiaries and the Trustee, stating, inter alia, that the Trustee
will be released from any liability in respect of any action or decision duly
taken and executed in good faith in relation to this Appendix, or any Trustee
102 Award or Share issued to him or her thereunder.

5.                                       Non-Trustee 102 Awards 

5.1.                              Awards
granted pursuant to this Section 5 are intended to constitute Non- Trustee 102
Awards and are subject to the provisions of Section 102 and the general terms
and conditions specified in the Plan, except for such provisions of the Plan
applying to Awards granted under a different tax law or regulations.

5.2.                              Non-Trustee
102 Awards may be granted only to Israeli Employees.

5.3.                              Non-Trustee
102 Awards that shall be granted pursuant to the Plan may be issued directly to
the Israeli Employee or to a trustee appointed by the administrator in his sole
discretion.  In the event that the
Administrator determines that Non-Trustee 102 Awards, and Shares issued upon
the exercise thereof, shall be deposited with a trustee, the provisions of
Sections 4.7 and4.10 of this Appendix shall apply, mutatis mutandis.

5.4.                              In
the event that an Israeli Employee who was granted a Non-Trustee 102 Award is
an employee of the Company, or any Parent or Subsidiary thereof, such employee
will be obligated to provide his employer, upon the termination of his
employment for any reason, with a security or guarantee to cover any future tax
obligation resulting from the grant, exercise or disposition of the Award or
the Shares issuable upon the exercise thereof, in the form satisfactory to such
employer in the latter’s sole discretion.

6.                                       3(i) Awards

6.1.                              Awards
granted pursuant to this Section 6 are intended to constitute 3(i) Awards and
are subject to the provisions of Section 3(i) of the Ordinance and the general
terms and conditions specified the Plan, except for provisions of the Plan
applying to Awards granted under a different tax law or regulations.

6.2.                              3(i)
Awards may be granted only to Israeli Non-Employees.

6.3.                              3(i)
Awards that shall be granted pursuant to the Plan may be issued directly to the
Israeli Non-Employee or to a trustee appointed by the administrator in his sole
discretion.  In the event that the Administrator
determines that 3(i) Awards, and Shares issued upon the exercise thereof, shall
be deposited with a trustee, the provisions of Sections 4.7 and 4.10 of this
Appendix shall apply, mutatis mutandis.

7.                                       The Award Agreement

The terms and
conditions upon which the Awards shall be issued and exercised, shall be as
specified in the Award Agreement to be executed pursuant to the Plan and this
Appendix. Each Award Agreement shall state, inter alia, the number of Shares to
which the Award relates, the type of Award granted thereunder (whether a
Trustee 102 Award and if so, whether a 102 CGA or 102 OIA, Non-Trustee 102
Award, or a 3(i) Award), the vesting provisions, the term of the Award, and the
exercise price. Any grant of Awards shall be conditioned upon the Participant’s
undertaking to be subject to the provisions of Section 102 or Section 3(i), as
applicable.

8.                                       Fair Market Value For Israeli Tax Purposes

Without derogating from Section 1(p) of the Plan and
solely for the purpose of determining the tax liability pursuant to Section
102(b)(3) of the Ordinance, if at the date of grant of a 102 CGA the Company’s
Shares are listed on any 

 15
 

established stock
exchange or a national market system, or if the Company’s shares are registered
for trading within ninety (90) days following the date of grant of the 102 CGA,
the fair market value of the Shares 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 applicable.

9.                                       Exercise of Awards

Awards shall be
exercised in accordance with the provisions of the Plan and the Award
Agreement, and when applicable, in accordance with the requirements of Section
102.

10.                                 Assignability and Sale of Awards

10.1.                        Notwithstanding any other
provision of the Plan to the contrary, no Options, Shares of Restricted Stock,
Deferred Stock, Performance Shares, or any right with respect thereto or purchasable
thereunder, whether fully paid or not, shall be assignable, transferable or
given as collateral or any right with respect thereto granted to any third
party whatsoever, without the prior written consent of the Administrator, and
in any event subject to the provisions of the Ordinance.  Any purported assignment, transfer, grant of
collateral, or pledge of Options, Shares of Restricted Stock, Deferred Stock,
Performance Shares or any right with respect thereto or purchaseable
thereunder, in contradiction to the provisions of this Section, directly or
indirectly, for an immediate effect or for a future one, shall be null and void
and cause the applicable Award to immediately expire.

During the
lifetime of the Participant all of such Participant’s rights to purchase Shares
or to otherwise exercise an Award hereunder shall be exercisable only by the
Participant.

10.2.                        Without derogating from Section
10.1 above, for as long as Awards or Shares purchased upon the exercise thereof
are held by the Trustee on behalf of the Participant, all rights of the
Participant with respect to such Awards and Shares shall be personal, and may
not be transferred, assigned, pledged or mortgaged, other than by will or laws
of descent and distribution.

Any purported
assignment, transfer, grant of collateral, or pledge of an Award or Share in
contradiction to the provisions of this Section, directly or indirectly, for an
immediate effect or for a future one, shall be null and void and cause the
Award to expire immediately.

11.                                 Integration of Section 102 And Tax Assessing
Officer’s Permit

11.1.                        With respect to Trustee 102
Awards, the provisions of the Plan, this Appendix and the Award Agreement shall
be subject to the provisions of Section 102 and the Tax Assessing Officer’s
permit (to the extent that such permit is issued) (the “Permit”), and said
provisions and Permit shall be deemed an integral part of the Plan, this
Appendix and the Award Agreement.

11.2.                        Any provision of Section 102 or
the Permit which is necessary in order to receive or to keep any tax benefit
pursuant to Section 102, which is not expressly specified in the Plan, this
Appendix, or the Award Agreement, shall be deemed to have been automatically
incorporated into this Appendix and considered binding upon the Company and the
Participants who are Israeli Employees or Israeli Non-Employees.

12.                                 Dividends

Without derogating
from the provisions of the Plan, a Participant shall be entitled to receive
dividends with respect to Shares issued upon the exercise of his or her Awards
(whether such Shares are held by the Participant or by the Trustee for his or
her benefit), in accordance with the provisions of Vyyo Inc.’s Certificate of
Incorporation (including all amendments thereto), subject to any applicable
taxation on distribution of dividends and, when applicable, subject to the
provisions of Section 102.

13.                                 Tax Consequences

13.1.                        Any tax arising with respect to
the grant or exercise of any Award, the payment for, or disposition of, Shares
covered thereby, or from any other event or act in connection therewith (of the
Company, its Parents or Subsidiaries, the Trustee or the Participant), shall be
borne solely by the Participant. The Company, its Parents, Subsidiaries, and
the Trustee shall be entitled to withhold taxes according to the requirements
of any applicable laws, rules, and regulations, including withholding taxes at
source and particularly regulation 7(b) of the Income Tax Regulations (tax
benefits on the issuance of shares to employees) 2003. The Participant shall
indemnify the Company, its Parents, Subsidiaries, and the Trustee, as the case
may be, and hold each of 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 Participant.

 16
 

13.2.                        The Administrator or, when
applicable, the Trustee shall not be required to release any share certificate
to a Participant until all required tax payments have been fully made.

 17

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