Document:

Exhibit 10.5.5

                          REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT, dated as of November __, 2004 (this
"Agreement"), by and among Ormat Technologies, Inc., a Delaware corporation (the
"Company"), Ormat Industries Ltd., an Israeli corporation ("OIL"), and any other
Person that may be designated by OIL from time to time and that agrees to become
a party to this Agreement in accordance with the provisions hereof.

                              W I T N E S S E T H:
                              - - - - - - - - - -

     WHEREAS, OIL is the holder of outstanding Common Stock (as defined below);

     WHEREAS, OIL has granted, and from time to time after the date hereof may
continue to grant, to a number of directors, officers and employees of OIL or of
any subsidiary thereof options to purchase from OIL shares of Common Stock held
by OIL ("Options");

     WHEREAS, the parties hereto desire to enter into this Agreement which sets
forth the registration rights, and certain other related covenants, applicable
to the shares of Common Stock that are (i) held from time to time by OIL and/or
any of its subsidiaries or (ii) acquired from time to time by directors,
officers or employees of OIL or of any subsidiary thereof upon the exercise of
Options.

     NOW, THEREFORE, in consideration of the premises and the mutual
obligations, covenants and agreements herein contained, the parties hereto agree
as follows:

                                   ARTICLE I

                                   DEFINITIONS

     1.1 Definitions. For purposes of this Agreement, the following terms shall
have the meanings set forth below:

     "Affiliate" shall mean, with respect to any given Person, any other Person
that directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such Person, and when used with
respect to any individual shall also include the Relatives of such individual.
The term "control" (including, with correlative meaning, the terms "controlled
by" and "under common control with"), as used with respect to any Person, means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.

     "Business Day" means any day other than a Saturday, Sunday or any other day
on which commercial banks in New York City are authorized or required by law to
close.

     "Commission" means the United States Securities and Exchange Commission or
any successor agency of the United States government administering the
Securities Act.

     "Common Stock" means the common stock, par value $0.001 per share, of the
Company.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended, and
any similar or successor federal statute, and the rules and regulations of the
Commission promulgated thereunder, as in effect at the time.

     "NYSE" shall mean the New York Stock Exchange, Inc. or any successor
corporation thereto.

     "Option Holder" means any current or former director, officer or employee
of OIL or of any subsidiary thereof that holds one or more Options or any
Registrable Securities acquired upon the exercise of one or more Options.

     "Options" has the meaning set forth in the recitals hereto.

     "Person" means a corporation, an association, a trust, a partnership, a
limited liability company, a joint venture, an organization, a business, an
individual, a government or political subdivision thereof, or a governmental
body.

     "Prospectus" means the prospectus included in any Registration Statement,
together with and including any amendment or supplement to such prospectus,
covering the public offering of any portion of the Registrable Securities
covered by a Registration Statement, and all material incorporated by reference
in such Prospectus.

     "Registering Shareholder" means any Shareholder whose Registrable
Securities are included in a Registration Statement filed pursuant to this
Agreement.

     "Registrable Securities" means: (i) the shares of Common Stock held by OIL
or any subsidiary thereof on the date hereof or that may be acquired by OIL or
any subsidiary thereof from time to time after the date hereof; (ii) the shares
of Common Stock acquired before or after the date hereof upon the exercise of
Options and held by any Shareholder; and (iii) any shares or other securities
into which or for which the shares of Common Stock referred to in clauses (i)
and (ii) above may be changed, converted or exchanged after the date hereof and
any other shares or securities issued after the date hereof in respect of such
shares (or such shares or other securities into which or for which such shares
are so changed, converted or exchanged), in each case, upon any
reclassification, stock combination, stock subdivision, stock dividend, share
exchange, merger, consolidation or similar transaction held by a shareholder;
provided, however, that a security will cease to be a Registrable Security when
it (i) has been effectively registered under the Securities Act and disposed of
in accordance with the Registration Statement covering it or (ii) is sold
pursuant to Rule 144 (or any similar rule then in force) under the Securities
Act.

     "Registration Statement" means a registration statement filed or to be
filed by the Company with the Commission covering Registrable Securities.

     "Relatives" means, with respect to any individual, the spouse, parents,
siblings and descendants of such individual and their respective issue (whether
by blood or adoption and including stepchildren) and the spouses of such
persons.

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     "Securities Act" means the Securities Act of 1933, as amended, or any
successor federal statute, together with the rules and regulations of the
Commission promulgated thereunder, as in effect at the time.

     "Shareholder" means (i) OIL, any subsidiary thereof or successor thereto
that holds Registrable Securities or (ii) any Option Holder that agrees to
become a party to this Agreement in accordance with the provisions hereof.

                                   ARTICLE II

                               REGISTRATION RIGHTS

     2.1 Demand Registration.

         (a) Request for Registration. Subject to the provisions hereof, at any
time and from time to time, OIL may make a written request (a "Demand") that the
Company prepare and file with the Commission a Registration Statement on Form
S-1 or, if the Company is then eligible to do so, that the Company prepare and
file with the Commission a Registration Statement on Form S-3, so as to permit a
public offering and sale of Registrable Securities held by any Shareholder. Any
Demand shall specify the number of Registrable Securities proposed to be
registered and the intended method of disposition thereof. A registration
effected pursuant to this Section 2.1 is hereinafter referred to as a "Demand
Registration."

         (b) Limitation on Demand Rights. Notwithstanding anything to the
contrary set forth in Section 2.1(a) hereof: (i) no Demand may be made less than
(A) one hundred and eighty (180) days following the effective date of the
Registration Statement on Form S-1 filed by the Company in connection with an
initial public offering of the Common Stock or (B) one hundred and twenty (120)
days following the effective date of any Registration Statement filed by the
Company pursuant to Section 2.1 hereof; and (ii) OIL shall not be entitled to
make more than one Demand that the Company prepare and file with the Commission
a Registration Statement on Form S-l.

         (c) Right to Delay Demand Registration. If, at any time when a Demand
is received by the Company, (i) the Company has undertaken to prepare a
registration statement which is intended to be filed within one hundred and
twenty (120) days from the date the Demand was received, or (ii) the Company's
Board of Directors determines in good faith that filing a Registration Statement
in response to such Demand either (A) would require the Company to make a public
disclosure of information which would have a material adverse effect upon the
Company or would be significantly disadvantageous to the Company or its
shareholders or (B) could interfere with, or would require the Company to
accelerate public disclosure of, any material financing, acquisition,
disposition, corporate reorganization or other material transaction involving
the Company or its subsidiaries, then the Company may, at its sole option, cause
the registration requested pursuant to the Demand to be delayed for a period not
in excess of one hundred and twenty (120) days from the effective date of the
registration statement which the Company is preparing or from the date such
Demand was received (such right to delay a request pursuant to clause (ii) of
this Section 2.1(c) may be exercised by the Company not more than twice in any
calendar year). If there is a postponement under this Section 2.1(c), OIL may

                                       3

withdraw such Demand by giving notice in writing to the Company. In such case,
no Demand will have been delivered for the purposes of this Section 2.1.

         (d) Company Participation. The Company may elect to register in any
Registration Statement prepared pursuant to a Demand made under this Section 2.1
any additional shares of Common Stock (including, without limitation, any shares
of Common Stock to be distributed in a primary offering made by the Company).
Such election, if made, shall be made by the Company giving written notice to
OIL stating (i) that the Company proposes to include additional shares of Common
Stock in such Registration Statement and (ii) the number of shares of Common
Stock proposed to be so included.

         (e) Withdrawal Right. OIL shall have the right to withdraw any Demand
by giving written notice to the Company of its request to withdraw; provided,
however, that (i) such withdrawal request must be made in writing prior to the
earlier of (A) the execution of the underwriting agreement or the execution of
the custody agreement with respect to such Demand Registration or (B) in the
absence of any such agreement, the date on which the Registration Statement
filed pursuant to such Demand is declared effective, and (ii) such withdrawal
shall be irrevocable and, after making such withdrawal, OIL shall not be
entitled to make any subsequent Demand for a period of one hundred and twenty
(120) days after the date of such withdrawal.

         (f) Effective Demand. For purpose of clause (ii) of Section 2.1(b)
hereof, a Demand, if made pursuant to Section 2.1(a) and not withdrawn in
accordance with Section 2.1(e), shall be deemed to have been made only if (i) in
response thereto, the Company shall have filed a Registration Statement, (ii)
such Registration Statement shall have been declared effective under the
Securities Act and (iii) such Registration Statement shall not have become the
subject of any stop order, injunction or other order or requirement of the
Commission or any other governmental or administrative agency which prevents the
sale of the relevant Registrable Securities pursuant to such Registration
Statement, and no court prevents or otherwise limits the sale of such securities
pursuant to such Registration Statement; provided, however, that,
notwithstanding anything to the contrary set forth in this Section 2.1(f), a
Demand shall be deemed to have been made by OIL, if OIL made a Demand and either
(x) OIL withdrew such Demand after the earlier of (A) the execution of the
underwriting agreement or the execution of the custody agreement with respect to
such Demand Registration or (B) in the absence of any such agreement, the date
on which the Registration Statement filed pursuant to such Demand is declared
effective, or (y) the failure of one or more of the conditions set forth in
clauses (i), (ii) or (iii) of this Section 2.1(f) to be satisfied is
attributable to the acts or omissions of OIL.

     2.2 Piggyback Registration.

         (a) Notice of Registration. If, at any time, the Company proposes to
file a registration statement with the Commission in connection with any public
offering of Common Stock (other than in connection with its initial public
offering of Common Stock), whether for the account of the Company or any other
Person (other than a registration statement on Form S-4 or Form S-8 (or any
successor forms under the Securities Act) or other registrations relating solely
to employee benefit plans or any transaction governed by Rule 145 under the
Securities Act), the Company shall give written notice of such proposed filing
and the proposed date

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thereof to each Shareholder that owns Registrable Securities at least twenty
(20) days before the anticipated filing of such registration statement, offering
such Shareholder the opportunity to offer and sell Registrable Securities owned
by such Person, by means of the prospectus contained in such registration
statement. If such Shareholder desires to have its Registrable Securities
registered under such registration statement pursuant to this Section 2.2, such
Shareholder shall advise the Company thereof in writing within ten (10) days
from the provision of the Company's notice (which request shall set forth the
number of Registrable Securities for which registration is requested). Subject
to Section 2.3 hereof, the Company shall include in such registration statement,
if filed, all Registrable Securities so requested by such Shareholder to be
included so as to permit such securities to be sold or disposed of in the manner
and on the terms set forth in such request. Such registration shall hereinafter
be called a "Piggyback Registration." The Company shall have the right at any
time to delay or discontinue, without liability to the Shareholders, any
Piggyback Registration under this Section 2.2 at any time prior to the effective
date of the Registration Statement if the proposed offering of Common Stock
contemplated thereunder is discontinued.

         (b) Withdrawal Right. Any Shareholder shall have the right to withdraw
its request for inclusion of its Registrable Securities in any Registration
Statement pursuant to this Section 2.2 by giving written notice to the Company
of its request to withdraw; provided, however, that (i) such withdrawal request
must be made in writing prior to the earlier of the execution of the
underwriting agreement or the execution of the custody agreement with respect to
such Piggyback Registration and (ii) such withdrawal shall be irrevocable and,
after making such withdrawal, such Shareholder shall no longer have any right to
include Registrable Securities in the Piggyback Registration from which such
Shareholder withdrew.

     2.3 Allocation of Securities Included in Registration Statements. In
connection with any Registration Statement in which the Shareholders have
requested to include Registrable Securities which relates to an underwritten
public offering, if the managing underwriter(s) of such offering advise(s) that
the inclusion in such Registration Statement of some or all of the shares sought
to be registered thereunder exceeds the number of shares (the "Saleable Number")
that can be sold in an orderly fashion without a substantial risk that the price
per share to be derived from such registration will be materially and adversely
affected, then the number of shares offered thereunder shall be limited to the
Saleable Number and shall be allocated, subject to Section 3.5 below, as
follows:

          (i)  if such registration is being effected in connection with any
               Piggyback Registration requested by the Shareholders for
               inclusion pursuant to Section 2.2 hereof, (1) first, to all the
               shares of Common Stock that the Company proposes to register for
               its own account, (2) second, the difference, if any, between the
               Saleable Number and the number of shares to be included pursuant
               to clause (1) above, to Registrable Securities of OIL, (3) third,
               the difference, if any, between the Salable Number and the number
               of shares to be included pursuant to clauses (1) and (2) above,
               to Registrable Securities of the other Shareholders, pro rata on
               the basis of the number of Registrable Securities requested to be
               included in such Piggyback Registration by each such Shareholder,
               until such

                                       5

               Shareholders have sold all such Registrable Securities, and (4)
               fourth, the difference, if any, between the Saleable Number and
               the number of shares to be included pursuant to clauses (1), (2)
               and (3) above, to all other selling shareholders, pro rata on the
               basis of the number of shares offered for sale by each such
               shareholder; and

          (ii) if the registration is being effected pursuant to a Demand
               Registration requested by OIL pursuant to Section 2.1 hereof, (1)
               first, to Registrable Securities of OIL, (2) second, the
               difference, if any, between such number and the number of shares
               to be included in such Demand Registration pursuant to clause (1)
               above, to Registrable Securities of the other Shareholders
               participating in the offering, pro rata, on the basis of the
               number of Registrable Securities requested to be included in such
               Demand Registration by each such Shareholder, until such
               Shareholders have sold all such Registrable Securities, (3)
               third, the difference, if any, between the Saleable Number and
               the number of shares to be included pursuant to clauses (1) and
               (2) above, to shares that the Company proposes to register for
               its own account, and (4) fourth, the difference, if any, between
               the Saleable Number and the number of shares to be included
               pursuant to clauses (1), (2) and (3) above, to all other selling
               shareholders, pro rata on the basis of the number of shares
               requested to be included by each such shareholder.

     2.4 Certain Notices; Suspension of Sales. The Company may, upon written
notice to the Registering Shareholders, suspend such Registering Shareholder's
use of any Prospectus (which is a part of any Registration Statement) for a
reasonable period not to exceed one hundred and twenty (120) days if the Company
in its reasonable judgment believes it may possess material non-public
information the disclosure of which in its reasonable judgment would have a
material adverse effect on the Company and/or its subsidiaries. Each Registering
Shareholder of Registrable Securities agrees by its acquisition of such
Registrable Securities to hold any communication by the Company pursuant to this
Section 2.4 in confidence.

                                  ARTICLE III

                             REGISTRATION PROCEDURES

     3.1 Registration Procedures. Subject to the terms of this Agreement,
whenever the Company is required to effect or cause the registration of
Registrable Securities pursuant to Article II hereof, the Company shall use its
best efforts to effect the registration of such Registrable Securities in
accordance with the intended method of disposition thereof as quickly as
practicable. In connection with any Demand Registration, the Company shall,
except as set forth in Section 2.1(c), as expeditiously as possible (and in no
event more than one hundred and twenty (120) days from the date of receipt of a
Demand) prepare and file with the Commission a Registration Statement on such
form (including Form S-3) for which the Company then qualifies as the Company
shall deem appropriate and which shall be available for the sale of the
Registrable Securities to be registered thereunder in accordance with the
provisions of this

                                       6

Agreement and in accordance with the intended method of disposition of such
Registrable Securities. The Company shall use its best efforts to cause any
Registration Statement filed hereunder to be declared effective as soon as
reasonably practicable after the filing thereof with the Commission, including,
without limitation, preparing and/or filing with the Commission such other
documents as may be necessary to comply with the provisions of the Securities
Act. Subject to the provisions of Section 2.4 hereof, the Company shall, as
expeditiously as possible, prepare and file with the Commission such amendments
and supplements to any Registration Statement filed hereunder and the Prospectus
used in connection therewith as may be necessary to keep such Registration
Statement effective (pursuant to Rule 415 under the Securities Act or otherwise)
until the earlier of (i) the date on which all of the Registrable Securities
registered therein shall have been sold, and (ii) ninety (90) days after such
Registration Statement is declared effective. The Company shall use its best
efforts to cause all shares of Common Stock so registered to be listed,
commencing not later than the effective date of the applicable registration
statement, on the NYSE or such other national securities exchange (including the
Nasdaq National Market) on which the Company's shares of Common Stock are listed
at such time, and the Company shall enter into all related customary agreements,
including a listing application and indemnification agreement in customary form,
and provide a transfer agent and registrar for the shares of Common Stock being
registered not later than the effective date of the applicable registration
statement. The Company shall take such other actions as are reasonable and
necessary to comply with the Securities Act, the Exchange Act and all applicable
rules and regulations promulgated thereunder, or with the reasonable request of
any Registering Shareholder with respect to the registration, qualification and
distribution of the shares of Common Stock to be registered.

     3.2 Copies; Review.

         (a) At least five (5) Business Days before filing a Registration
Statement or Prospectus or any amendment or supplement thereto (whether before
or after effectiveness), the Company will furnish to the Registering
Shareholders copies of all such documents proposed to be filed. Such documents
will be subject to the review of the Registering Shareholders. The Company will
immediately amend such Registration Statement and Prospectus to include such
reasonable changes as the Registering Shareholders and the Company reasonably
agree should be included therein. Any Registering Shareholder requesting a
change which, in its reasonable judgment, is unreasonably refused by the Company
may withdraw its Registrable Securities from such Registration Statement.

         (b) The Company shall make available for inspection by any Registering
Shareholder, any underwriter(s) participating in any disposition pursuant to a
Registration Statement, and any attorney, accountant or other agent retained by
any such Shareholder or underwriter (collectively, the "Inspectors"), all
material financial and other records, pertinent documents and properties of the
Company as shall be necessary to enable them to exercise their due diligence
responsibility. The Company shall cause its officers, directors and employees to
supply all material information requested by any such Inspector in connection
with any such Registration Statement.

     3.3 Amendments. Subject to Section 2.4 hereof, the Company shall (a)
prepare and file with the Commission such amendments and post-effective
amendments to the Registration

                                       7

Statement as may be necessary to keep the Registration Statement effective for
the applicable time period required herein, (b) cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 under the Securities Act, and (c) comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such Registration Statement during the applicable period
in accordance with the intended methods of disposition by the Registering
Shareholders set forth in such Registration Statement or Prospectus supplement.

     3.4 Notification. The Company shall promptly notify the Registering
Shareholders and (if requested by any such Person) confirm such notification in
writing, (a) when the Prospectus has been filed, and, with respect to the
Registration Statement, when it has become effective, (b) of any request by the
Commission for amendments or supplements to the Registration Statement or the
Prospectus or for additional information, (c) of the issuance of any stop order
suspending the effectiveness of the Registration Statement, or the refusal or
suspension of qualification of registration of Registrable Securities, or the
initiation of any proceedings for that purpose, (d) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction, or the initiation or threatening of any proceeding for such
purpose, and (e) of any event that makes any material statement made in the
Registration Statement, the Prospectus or any document incorporated therein by
reference untrue or that requires the making of any changes in the Registration
Statement, the Prospectus or any document incorporated therein by reference in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading in any material respect. Subject to Section 2.4
hereof, the Company will make every reasonable effort to obtain the withdrawal
of any order suspending the effectiveness of the Registration Statement at the
earliest possible moment. If any event contemplated by clause (e) occurs,
subject to Section 2.4 hereof, the Company shall promptly prepare a supplement
or post-effective amendment to the Registration Statement or the Prospectus or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities, the Prospectus will not contain an
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading. Upon receipt of any notice from the Company that any
event of the kind described in clause (b), (c), (d) or (e) has happened, each
Registering Shareholder shall discontinue offering the Registrable Securities
until the Registering Shareholder receives the copies of the supplemented or
amended Prospectus contemplated by the previous sentence, or until it is advised
in writing by the Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
by reference in the Prospectus.

     3.5 Information Included. The Company may require each Registering
Shareholder to furnish in writing to the Company such information regarding the
Registering Shareholder and the distribution of the Registrable Securities as
the Company may from time to time reasonably require for inclusion in the
Registration Statement, and such other information as may be legally required in
connection with such registration including, without limitation, all such
information as may be requested by the Commission or the NYSE or any other
applicable national exchange upon which the Common Stock is listed or to be
listed. Each Registering Shareholder shall provide such information in writing
and signed by such Shareholder and stated to be specifically for inclusion in
the Registration Statement. The Company may exclude from such registration

                                       8

the Registrable Securities of any Registering Shareholder that fails to furnish
such information within a reasonable time after receiving such request. Each
Registering Shareholder agrees to furnish to the Company all information
required to be disclosed in order to make the information previously furnished
to the Company by such Registering Shareholder not misleading. If requested by
the Registering Shareholders, the Company will, as soon as practicable,
incorporate in a Prospectus supplement or post-effective amendment such
information as the Registering Shareholders reasonably request be included
therein relating to the sale of the Registrable Securities, including, but not
limited to, information with respect to the number of Registrable Securities
being sold and any other terms of the distribution of the Registrable Securities
to be sold in such Offering. Subject to Section 2.4 hereof, the Company will
make all required filings of such Prospectus supplement or post-effective
amendment as promptly as practicable after being notified of the matters to be
incorporated in such Prospectus supplement or post-effective amendment.

     3.6 Underwritten Offerings. In the event that the distribution of the
Registrable Securities covered by a Registration Statement filed hereunder shall
be effected by means of an underwriting, the following provisions shall apply:

         (a) if such distribution of Registrable Securities is being effected
pursuant to a Demand Registration, the underwriter(s) shall be designated by
OIL;

         (b) the Company shall (i) cooperate with the underwriter(s), including
attending any road shows and providing such assistance as the underwriter(s) may
reasonably request in connection with the preparation of any materials necessary
or desirable to effect such underwriting, (ii) enter into any such underwriting
agreement as shall be appropriate under the circumstances, (iii) use its best
efforts to comply with and satisfy all of the terms and conditions of each such
underwriting agreement to which it shall be a party, and (iv) comply with all
applicable rules and regulations of the Commission including, without
limitation, applicable reporting requirements under the Exchange Act;

         (c) if such distribution of Registrable Securities is being effected
pursuant to a Demand Registration, including, without limitation, in any primary
offering by the Company, any over-allotment option to be granted to the managing
underwriter(s) shall be allocated to and granted by any Person designated by
OIL, and if such distribution is being effected pursuant to a Piggyback
Registration, any over-allotment option to be granted to the managing
underwriter(s) shall be allocated to and granted by the Company (in the event of
any primary offering by the Company) and all selling shareholders pro-rata based
on the number of shares sold pursuant to such offering; and

         (d) the Registering Shareholder(s) shall enter into underwriting
agreement(s), power(s) of attorney and custody agreement(s), which agreements
and powers shall contain customary provisions as shall be appropriate under the
circumstances.

     3.7 Copies. The Company will (i) promptly furnish to the Registering
Shareholders without charge, at least one signed copy of the Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules, all documents incorporated therein by reference and
all exhibits (including those incorporated by reference), and

                                       9

(ii) promptly deliver to the Registering Shareholders without charge, as many
copies of the Prospectus (including each Preliminary Prospectus) and any
amendment or supplement thereto as such Persons may reasonably request. The
Company consents to the use of the Prospectus or any amendment or supplement
thereto by the Registering Shareholders in connection with the offering and sale
of the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto.

     3.8 Blue Sky Registration. Prior to any offering of Registrable Securities
covered by a Registration Statement under Section 2.1 or 2.2, the Company will
register or qualify or cooperate with the Registering Shareholders and their
respective counsel in connection with the registration or qualification of such
Registrable Securities under the securities or blue sky laws of any such
jurisdictions in the United States as the Registering Shareholders reasonably
request in writing, and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of such Registrable
Securities. The Company will not be required to take any actions under this
Section 3.8 if such actions would require the Company to (i) qualify to do
business in any jurisdiction where it is not then so qualified, (ii) submit to
the general taxation of any jurisdiction where it is not then so subject or
(iii) file in any jurisdiction any general consent to service of process.

     3.9 Certificates. The Company will cooperate with the Registering
Shareholders to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold that do not bear any restrictive
legends. Such certificates will be in such denominations and registered in such
names as the Registering Shareholders request at least two (2) Business Days
prior to any sale of Registrable Securities.

     3.10 Section 11(a) Notice. The Company will make generally available to its
shareholders the information required pursuant to the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder.

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     3.11 Registration Expenses.
          ---------------------

         (a) Company Expenses. Subject to the provisions of Section 3.11(b)
below, the Company shall pay all expenses incident to the Company's performance
of or compliance with this Agreement, including, but not limited to, all
registration and filing fees, fees and expenses of compliance with securities or
blue sky laws, fees and expenses incurred in connection with the quotation or
listing of the Registrable Securities on the NYSE (or any other national
securities exchange on which such securities are then listed), transfer agent
fees, printing expenses, messenger expenses, telephone and delivery expenses,
and fees and disbursements of counsel to the Company, counsel to the
underwriter(s) of any underwritten offering (but only to the extent that the
Company or the Registering Shareholders are contractually required to bear such
fees and disbursements pursuant to the applicable underwriting agreement(s)) and
of independent certified public accountants of the Company. The Company shall
also pay for (i) the fees and expenses of one firm of legal counsel, if any,
retained to represent all the Registering Shareholders in connection with any
Registration Statement filed hereunder, (ii) the Company's internal expenses,
including the expense of any annual audit, (iii) the fees and expenses of any
Person retained by the Company, and (iv) the cost of furnishing copies of each
preliminary Prospectus, each final Prospectus and each such amendment or
supplement thereto to the underwriters, dealers and other purchasers of shares
of Common Stock.

         (b) Shareholder Expenses. The Registering Shareholders shall pay all
underwriting fees, commissions and discounts with respect to the sale of any
Registrable Securities and any transfer taxes incurred in respect of such sale.
Each Registering Shareholder shall also be responsible for the payment of all
fees and expenses of legal counsel retained by it, other than the fees and
expenses of the firm of legal counsel retained to represent all the Registering
Shareholders in connection with any Registration Statement filed hereunder for
which the Company is responsible pursuant to Section 3.11(a) above.

                                   ARTICLE IV

                                 INDEMNIFICATION

     4.1 Indemnification by the Company. The Company will indemnify and hold
harmless each of the Registering Shareholders and each Person, if any, who
controls a Registering Shareholder (within the meaning of Section 15 of the
Securities Act ) (each, a "Shareholder Control Person") from and against any and
all losses, claims, damages and liabilities ("Losses") reasonably incurred in
connection with, and any amount paid in settlement of, any action suit or
proceeding or any claim asserted to which the Registering Shareholder or
Shareholder Control Person may become subject under the Securities Act, the
Exchange Act or other federal or state securities laws or regulations, at common
law or otherwise, insofar as such Losses arise out of or are based upon (a) any
untrue statement or alleged untrue statement of a material fact contained in any
Registration Statement, Prospectus or preliminary prospectus or any amendment or
supplement thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or (b) any violation by the Company of the Securities Act or the
Exchange Act, or other federal or state securities laws

                                       11

applicable to the Company and relating to any action or inaction required of the
Company in connection with such registration. In addition, the Company will
reimburse the Registering Shareholder and Shareholder Control Person(s) for any
reasonable investigation, legal or other expenses incurred by such Registering
Shareholder or Shareholder Control Person(s) in connection with investigating or
defending any such Loss. Notwithstanding anything herein to the contrary, the
Company will not be liable with respect to the portion of any such Loss that (i)
arises out of or is based upon any alleged untrue statement or alleged omission
made in such Registration Statement, preliminary Prospectus, Prospectus, or
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by the Registering Shareholders
specifically for use therein or (ii) attributable to a Registering Shareholder's
(A) use of a Prospectus after being notified by the Company to suspend use
thereof pursuant to Section 3.4 above or (B) failure to deliver a final
Prospectus to the Person asserting any losses, claims, damages and liabilities
and judgments caused by any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus, or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, if such
material misstatement or omission or alleged material misstatement or omission
was cured in an amended or supplemented Prospectus prepared by the Company and
delivered to the Registering Shareholder at or prior to the time written
confirmation of sale to such Person was required to be made. The foregoing
indemnity will remain in full force and effect regardless of any investigation
made by or on behalf of the Registering Shareholder or Shareholder Control
Person, and will survive the transfer of such securities by the Registering
Shareholder.

     4.2 Indemnification by Registering Shareholders. If a Registering
Shareholder sells Registrable Securities under a Prospectus that is part of a
Registration Statement, the Registering Shareholder shall indemnify and hold
harmless the Company, its directors, each officer who signed such Registration
Statement and each Person who controls the Company (within the meaning of
Section 15 of the Securities Act) (each, a "Controlling Person") under the same
circumstances as the foregoing indemnity from the Company to the Registering
Shareholders and Shareholder Control Persons, but only to the extent that such
Losses arise out of or are based upon any untrue or allegedly untrue statement
of a material fact or omission or alleged omission of a material fact that was
made in the Prospectus, the Registration Statement, any preliminary prospectus,
or any amendment or supplement thereto, in reliance upon and in conformity with
written information relating to a Registering Shareholder or a Shareholder
Control Person furnished to the Company by a Registering Shareholder expressly
for use therein. In no event will the aggregate liability of a Registering
Shareholder and/or a Shareholder Control Person exceed the amount of the net
proceeds received by the Registering Shareholder upon the sale of the
Registrable Securities giving rise to such indemnification obligation. Such
indemnity will remain in full force and effect regardless of any investigation
made by or on behalf of the Company or such officer, director, employee or
Controlling Person and will survive the transfer of such securities by the
Registering Shareholder.

     4.3 Contribution. If the indemnification provided for in Section 4.1 or 4.2
is unavailable to an indemnified party, then each applicable indemnifying party,
in lieu of indemnifying such indemnified party, will have a joint and several
obligation to contribute to the amount paid or payable by such indemnified party
as a result of such Losses. Such contribution will be in such proportion as is
appropriate to reflect the relative fault of the indemnifying party,

                                       12

on the one hand, and such indemnified party, on the other hand, in connection
with the actions, statements or omissions that resulted in such Losses, as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party, on the one hand, and indemnified party, on the other hand,
will be determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact, has been taken or made
by, or relates to information supplied by, such indemnifying party or
indemnified party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent any such action, statement or
omission. The amount paid or payable by a party as a result of any such Losses
will be deemed to include any investigation, legal or other fees or expenses
incurred by such party in connection with any investigation or proceeding, to
the extent such party would have been indemnified for such expenses if the
indemnification provided for in Section 4.1 or 4.2 was available to such party.
If, however, the allocation provided above is not permitted by applicable law,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect not only
such relative faults but also the relative benefits of the indemnifying party
and the indemnified party as well as any other relevant equitable
considerations. The parties hereto agree that it would not be just and equitable
if contributions pursuant to this Section 4.3 were to be determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the preceding sentences of this
Section 4.3. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

     4.4 Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder will (a) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification, and (b) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided that the failure to give such
notice shall not relieve an indemnifying party of liability except to the extent
it has been prejudiced as a result of such failure. Any Person entitled to
indemnification hereunder shall have the right to employ separate counsel and to
participate in (but not control) the defense of such claim, but the fees and
expenses of such counsel will be at the expense of such Person and not of the
indemnifying party unless (x) the indemnifying party has agreed to pay such fees
or expenses, (y) the indemnifying party has failed to assume the defense of such
claim and employ counsel reasonably satisfactory to such Person within a
reasonable period of time pursuant to this Agreement, or (z) a conflict of
interest exists between such Person and the indemnifying party with respect to
such claims that would make such separate representation required under
applicable ethical rules. In the case of clause (z) above, if the Person
notifies the indemnifying party in writing that such Person elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of such claim on behalf of
such Person. If such defense is not assumed by the indemnifying party, the
indemnifying party shall not be subject to any liability for any settlement made
without its consent (but such consent shall not be unreasonably withheld). No
indemnified party will be required to consent to entry of any judgment or enter
into any settlement that does not include as an unconditional term the giving of
a release, by all claimants or plaintiffs to such indemnified party from all
liability with respect to such claim or litigation. Any indemnifying party who
is not entitled to, or elects not to, assume the defense of a claim

                                       13

will not be obligated to pay the fees and expenses of more than one counsel
(other than required local counsel) for all parties indemnified by such
indemnifying party with respect to such claim.

                                   ARTICLE V

                                OTHER AGREEMENTS

     5.1 Restrictions on Public Sale by the Shareholders. If requested by the
managing underwriter(s) of an underwritten public offering, the Shareholders
will not effect any public sale or distribution of securities of the same class
(or securities exchangeable or exercisable for or convertible into securities of
the same class) as the securities included in such offering (including, but not
limited to, a sale pursuant to Rule 144 of the Securities Act) during the 10-day
period prior to and the 180-day period beginning on the effective date of, such
offering (the "Lock-up Period"). Notwithstanding the foregoing, if (1) during
the last 17 days of the Lock-Up Period the Company issues an earnings release or
material news of a material event relating to the Company occurs or (2) prior to
the expiration of the Lock-Up Period, the Company announces that it will release
earnings results during the 17-day period beginning on the last day of the
Lock-Up Period, then the Lock-Up Period shall continue to apply until the
expiration of the 17-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event.

     5.2 Rule 144. The Company shall file, on a timely basis, all reports
required to be filed by it under the Securities Act and the Exchange Act, and
will take such further action and provide such documents as the Shareholders may
reasonably request, all to the extent required from time to time to enable the
Shareholders to sell Registrable Securities without registration under the
Securities Act within the limitation of the conditions provided by (i) Rule 144
under the Securities Act, as such rule may be amended from time to time, or (ii)
any similar rule or regulation hereafter adopted by the Commission. Upon the
request of a Shareholder, the Company will deliver to the Shareholder a
statement verifying that it has complied with such information and requirements.

                                   ARTICLE VI

                                  MISCELLANEOUS

     6.1 Amendments; Waivers. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified or terminated, except upon the
execution and delivery of a written agreement executed by the parties hereto.

     6.2 Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto pertaining to its subject matter and supersedes and
replaces all prior agreements and understandings of the parties in connection
with such subject matter.

     6.3 Notices. All notices and other communications hereunder shall be given
in writing and delivered personally, by registered or certified mail (postage
prepaid return receipt requested), by overnight courier (postage prepaid),
facsimile transmission or similar means, to the party to receive such notices or
communications at the address set forth below (or such other

                                       14

address as shall from time to time be designated by such party to the other
parties in accordance with this Section 6.3):

              If to the Company: Ormat Technologies, Inc.
                                 980 Greg Street
                                 Sparks, Nevada  89431
                                 Attention: President
                                 Facsimile: (775) 356-9039

              If to OIL:         Ormat Industries Ltd.
                                 Industrial Area
                                 Scydlowski Road
                                 PO Box 68
                                 Yavne, 81100
                                 Israel
                                 Attention: President
                                 Facsimile: +972- 8-943-9901

All such notices and communications hereunder shall be deemed given when
received, as evidenced by the signed acknowledgment of receipt of the person to
whom such notice or communication shall have been personally delivered, the
acknowledgment of receipt returned to the sender by the applicable postal
authorities, the confirmation of delivery rendered by the applicable overnight
courier service, or the confirmation of a successful facsimile transmission of
such notice or communication. A copy of any notice or other communication given
by any party to any other party hereto, with reference to this Agreement, shall
be given at the same time to the other parties to this Agreement.

     6.4 GOVERNING LAW. THE PARTIES HERETO AGREE THAT THIS AGREEMENT, AND THE
RESPECTIVE RIGHTS, DUTIES AND OBLIGATIONS OF THE PARTIES HEREUNDER, SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW THEREUNDER.

     6.5 Assignment. No Shareholder shall be permitted to assign any of its
rights or obligations hereunder by operation of law or otherwise without the
prior written consent of the Company; provided, that a Shareholder may assign
any of its rights or obligations hereunder to any Affiliate of such Shareholder
without obtaining the prior written consent of the Company so long as such
Affiliate agrees in writing to be bound by the provisions of this Agreement that
are applicable to such Shareholder as if such Affiliate was an original party
hereto. Notwithstanding any such assignment, such Shareholder shall continue to
be liable for the performance of all obligations of such Shareholder and those
of its assignee hereunder.

     6.6 Severability. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law. If any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any

                                       15

provision in such jurisdiction, and this Agreement will be reformed, construed
and enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision or portion of any provision had never been contained herein.

     6.7 No Waiver. The failure of any party hereto to exercise any right, power
or remedy provided under this Agreement or otherwise available in respect hereof
at law or in equity, or to insist upon compliance by any other party hereto with
its obligations hereunder, and any custom or practice of the parties at variance
with the terms hereof, shall not constitute a waiver by such party of its right
to exercise any such or other right, power or remedy or to demand such
compliance.

     6.8 No Third Party Beneficiaries. This Agreement is not intended to be for
the benefit of, and shall not be enforceable by, any Person who or which is not
a party hereto. Any Person who or which is not a party hereto shall not be
entitled to any benefit hereunder except that any Option Holder designated in
writing by OIL from time to time shall be entitled to become a party hereto by
executing a counterpart to this Agreement in the form annexed hereto as Exhibit
A. If such Option Holder executes a counterpart to this Agreement in the form
annexed hereto as Exhibit A such Option Holder shall thereafter be deemed to
have agreed to be bound by the provisions hereof applicable to Shareholders as
if such Option Holder was an original party hereto, and such Option Holder shall
thereafter be entitled to all benefits accorded to a Shareholder hereunder.

     6.9 Headings. The Section headings in this Agreement are for convenience of
reference only and are not intended to be a part of this Agreement or to affect
the meaning or interpretation of this Agreement.

     6.10 Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one agreement.

     IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement as of the date first set forth above.

                                       ORMAT TECHNOLOGIES, INC.

                                       By: -------------------------------------
                                           Name:  [               ]
                                           Title:[               ]

                                      ORMAT INDUSTRIES LTD.

                                       16

                                     By: ---------------------------------------
                                         Name:  [                ]
                                         Title:[                ]

                                       17

                                    EXHIBIT A

                 COUNTERPART SIGNATURE PAGE TO THE REGISTRATION

                      RIGHTS AGREEMENT DATED JULY __, 2004

     REFERENCE IS MADE to the Registration Rights Agreement, dated as of July
__, 2004 (the "Agreement"), by and among Ormat Technologies, Inc. (the
"Company"), Ormat Industries Ltd. ("OIL") and the other parties, if any,
thereto. Capitalized terms defined in the Agreement and not otherwise defined
herein shall have the meanings ascribed to them in the Agreement.

     THE UNDERSIGNED hereby represents to the Company that (i) the undersigned
is a current or former director, officer and/or employee of OIL or of any
subsidiary thereof or an Affiliate of a current or former director, officer or
employee, and (ii) the undersigned beneficially owns one or more options to
purchase from OIL shares of common stock, par value $0.001 per share, of the
Company ("Common Stock") or the undersigned beneficially owns shares of Common
Stock acquired upon the exercise of such options. The undersigned hereby
irrevocably agrees to be a party to the Agreement and to be bound by all
provisions thereof applicable to Shareholders, as if the undersigned was an
original party thereto.

     IN WITNESS THEREOF, the undersigned has executed this counterpart to the
Agreement on this __ day of ______________, _____.

                                             -----------------------------------
                                             Name:ORMAT TECHNOLOGIES, INC.
                        2004 INCENTIVE COMPENSATION PLAN

1.       PURPOSE OF PLAN

         The purpose of the Ormat Technologies, Inc. 2004 Incentive Compensation
Plan (the "Plan") is to assist Ormat Technologies, Inc. and its Subsidiaries
(the "Corporation") in securing and retaining Eligible Individuals of
outstanding ability by making it possible to offer them increased incentives,
which may include a proprietary interest in the Corporation, to join or continue
in the service of the Corporation and to increase their efforts for its welfare.

2.       DEFINITIONS

         As used in the Plan, the following words have the following meanings:

              (a) "AWARD" means an award or grant made to a Participant pursuant
         to the Plan, including, without limitation, an award or grant of an
         Option, Stock Appreciation Right, Restricted Stock, Stock Units,
         Phantom Stock, Incentive Bonuses, Performance Awards, or any
         combination of such types of Awards.

              (b) "BOARD OF DIRECTORS" means the Board of Directors of Ormat.

              (c) "CODE" means the Internal Revenue Code of 1986, as amended.

              (d) "COMMITTEE" means the Compensation Committee of the Board of
         Directors. Prior to the creation of the Committee by the Board of
         Directors, any reference to "Committee" in the Plan or in an Award
         means the Board of Directors.

              (e) "COMMON  STOCK"  means the  common  stock of Ormat,  par value
         $.001.

              (f) "CORPORATION" means Ormat and its Subsidiaries.

              (g) "EFFECTIVE DATE" means the date specified in Section 20 of the
         Plan.

              (h) "ELIGIBLE INDIVIDUAL" means an employee, a member of the Board
         of Directors or an independent contractor of the Corporation.

              (i) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
         amended.

              (j) "FOREIGN TAX ELIGIBLE INDIVIDUALS" means Eligible Individuals
         who are subject to the tax laws of nations other than the United
         States.

              (k) "FREESTANDING  STOCK SAR" means the type of SAR  described  in
         Section 2(x)(ii) of the Plan.

              (l) "GRANT COMMITTEE" means the Committee, excluding those members
         of the Committee who are not at the time of the grant of the Award both
         "outside directors" as defined for purposes of Section 162(m) and the
         regulations under such section of the Code and "Non-Employee Directors"
         as defined in Rule 16b-3(b)(3)(i) under the Exchange Act, for purposes
         of Section 16 of the Exchange Act and the rules under the Exchange Act.

              (m) "INCENTIVE BONUS" means an Award of a right to receive cash or
         shares of Common Stock, whether or not subject to performance goals and
         performance periods.

              (n) "INCENTIVE STOCK OPTION" means an Option to purchase shares of
         Common Stock which is intended to qualify as an incentive stock option
         as defined in Code Section 422.

              (o) "NAMED EXECUTIVE OFFICER" means (i) all individuals serving as
         the Corporation's CEO or acting in a similar capacity during the last
         completed fiscal year, regardless of compensation level; (ii) the
         Corporation's four most highly compensated executive officers other
         than the CEO who were serving as executive officers at the end of the
         last completed fiscal year; and; (iii) up to two additional individuals
         for whom disclosure would have been provided pursuant to clause (ii) of
         the definition of Named Executive Officer herein but for the fact that
         the individual was not serving as an executive officer of the
         Corporation at the end of the last completed fiscal year, as defined in
         Item 402(a)(3) of Regulation S-K.

              (p) "NONQUALIFIED STOCK OPTION" means an Option to purchase shares
         of Common Stock which is not intended to qualify as an incentive stock
         option as defined in Code Section 422.

              (q) "OPTION" means an Award of the right to purchase a specified
         number of shares of Common Stock at a specified price for a specified
         period.

                                       2

         Two types of Options may be awarded under the Plan: (i) Incentive Stock
         Options; and (ii) Nonqualified Stock Options.

              (r) "ORMAT" means Ormat Technologies, Inc.

              (s) "PARTICIPANT" means an Eligible Individual to whom one or more
         Awards have been granted that have not all been forfeited or terminated
         under the Plan.

              (t) "PERFORMANCE AWARD" means an Award granted pursuant to Section
         11 of the Plan.

              (u) "PHANTOM STOCK" means an Award of a right to receive an amount
         in cash equal to the fair market value of a share of Common Stock at a
         specified date.

              (v) "PLAN"  means  the Ormat  Technologies,  Inc.  2004  Incentive
         Compensation Plan.

              (w) "RESTRICTED STOCK" means an Award of shares of Common Stock
         that is subject to restrictions on transfer for a specified period.

              (x) "RETIREMENT" means Termination of Service upon attainment of
         age 65.

              (y) "STOCK APPRECIATION RIGHT" or "SAR" means an Award of a right
         which: (i) when granted in conjunction with all or any part of any
         Option, upon exercise of such right, entitles a Participant to
         surrender such Option, or any part of such Option, and to receive
         instead a payment in cash or in shares of Common Stock equal to the
         excess of (x) the fair market value on the date of exercise of the
         shares of Common Stock covered by the Option, or part of such Option,
         over (y) the purchase price of such shares of Common Stock pursuant to
         the Option (a Tandem SAR); or (ii) when granted separate and apart from
         any Option, entitles the Participant, upon exercise of such right, to
         receive a payment in cash or in Common Stock measured by the increase
         in the fair market value of a number of shares of Common Stock
         designated by such SAR from the date of such SAR to the date on which
         the Participant exercises such SAR (a Freestanding SAR).

              (z) "STOCK  UNIT"  means an Award of the right to  receive a fixed
         number of shares of Common Stock at a future date.

                                       3

              (aa) "SUBSIDIARY" means any corporation or entity, other than
         Ormat, in an unbroken chain of corporations or other entities beginning
         with Ormat if each of the corporations, or other entities other than
         the last corporation or entity in the unbroken chain owns 50% or more
         of the voting stock in one of the other corporations in such chain,
         except that with respect to Incentive Stock Options, "Subsidiary" means
         "subsidiary corporation" as defined in Code Section 424(f).

              (bb) "TANDEM SAR" means the type of SAR described in Section
         2(x)(i) of the Plan.

              (cc) "TERMINATION OF SERVICE" means: (i) for an employee,
         termination of employment with the Corporation for any reason; (ii) for
         a member of the Board of Directors, termination as a member of the
         Board of Directors for any reason; or (iii) for an independent
         contractor of the Corporation, termination of the relationship as an
         independent contractor of the Corporation for any reason.

3.       ADMINISTRATION OF PLAN

              (a) General Administration. The Plan will be administered by the
         Committee consisting of at least three members of the Board of
         Directors. The Committee will determine the aggregate amount of shares
         of Common Stock to be the subject of Awards granted under the Plan each
         year to all Eligible Individuals and will make any adjustments under
         Section 16 of the Plan. The Committee will also determine the amount of
         any Awards granted to Eligible Individuals and the terms of such
         Awards, except that Performance Awards under Section 11 of the Plan
         will only be granted to Eligible Individuals by the Committee, in
         accordance with the requirements of Code Section 162(m). The Committee
         may delegate to the Chief Executive Officer of the Corporation (the
         "CEO") the right to designate other Eligible Individuals (other than
         the CEO) to receive Awards and to determine the amount of any Awards
         granted to such Eligible Individuals and the terms of such Awards,
         except that Performance Awards under Section 11 of the Plan to any of
         the Corporation's Named Executive Officers will only be granted to such
         Named Executive Officers by the Committee, in accordance with the
         requirements of Code Section 162(m). The members of the Committee will
         qualify to administer the Plan for purposes of Rule 16b-3 (and any
         other applicable rule) promulgated under Section 16(b) of the Exchange
         Act and must be independent directors under the New York Stock Exchange
         rules. The Committee may adopt its own rules of procedure, and the
         action of a majority of the Committee members, taken at a meeting, or
         taken without a meeting by unanimous written consent of the members of
         the Committee or otherwise in accordance with the Committee's charter,
         will constitute action by the Committee.

                                       4

         The Committee, in its sole and absolute discretion and authority,  will
         determine the amount,  timing and  restrictions  on the Awards and will
         administer,  construe and interpret  the Plan,  make rules for carrying
         out the  interpretations  of the  Committee  and make  changes  to such
         rules.  Any  such  determination,   interpretation  or  change  by  the
         Committee  will  be  final,  conclusive  and  binding  on all  parties,
         including the Corporation and each Participant.

              (b) Administration of Section 11 of the Plan. Notwithstanding any
         language in the Plan to the contrary, the Grant Committee, in its sole
         and absolute discretion and authority, will have the exclusive power to
         grant Awards and to determine the amount, timing and restrictions on
         the Awards under Section 11 of the Plan and will administer, construe
         and interpret Section 11 of the Plan, make rules carrying out the
         interpretations of the Grant Committee and make changes to such rules.
         Any such determination, interpretation or change by the Grant Committee
         under Section 11 of the Plan will be final, conclusive and binding on
         all parties, including the Corporation and each Participant.

4.       AWARDS

         The Committee or the CEO, or his or her delegate, may from time to time
make such Awards under the Plan in accordance with Sections 5 through 10 of the
Plan to such Eligible Individuals and in such form and having such terms,
conditions and limitations as the Committee or the CEO, or his or her delegate,
may determine. Awards may be granted singly, in combination or in tandem. The
amount of each Award granted under the Plan and the terms, conditions and
limitations of each such Award will be set forth in writing on a form approved
by the Committee, consistent, however, with the terms and conditions of the
Plan. The provisions of Awards need not be the same with respect to each
Participant. In case of any discrepancy between the terms in any Award and the
Plan, the Plan will govern.

5.       AWARDS OF OPTIONS

         The terms and conditions with respect to each Award of Options under
the Plan will be consistent with the following:

              (a) Option Price. The Option price per share will not be less than
         the fair market value per share of Common Stock at the time the Award
         is granted. Awards of Incentive Stock Options for certain Eligible
         Individuals may be required to be granted at up to 110% of the fair
         market value per share of Common Stock.

                                       5

              (b) Incentive Stock Options.  Awards of Incentive Stock Options
         will be granted only to employees.

              (c) Exercise Period. The exercise of an Award may be conditioned
         upon completion of all or a part of a vesting schedule specified in the
         Award and/or the satisfaction of performance or other criteria as
         specified in the Award. The Award will be exercisable, in whole or in
         part, from time to time beginning as stated in the Award and ending at
         the expiration of ten years from the date of grant of the Award, unless
         an earlier expiration date will be stated in the Award or the Option
         expires because of the exercise of a Tandem SAR as provided in Sections
         5(f) and 6(a) of the Plan.

              (d) Limit on Incentive Stock Options. To the extent that the
         aggregate fair market value of shares of Common Stock with respect to
         which Incentive Stock Options are exercisable for the first time by any
         Participant during any calendar year exceeds $100,000, such Options
         will be treated as Nonqualified Stock Options. This subclause (d) will
         be applied by taking Options into account in the order in which they
         were granted. For purposes of this subclause (d), the fair market value
         of any share of Common Stock will be determined at the time of the
         Award. If this subclause (d) results in a portion of an Incentive Stock
         Option exceeding the $100,000 limitation, only such excess will be
         treated as a Nonqualified Stock Option.

              (e) Payment for Shares of Common Stock. Payment in full of the
         Option price must be made upon exercise of each Option and may be made
         in cash, or, to the extent provided in the Award, by the delivery
         (either actual delivery or by attestation procedures established by
         Ormat) of shares of Common Stock with a fair market value determined as
         of the date of exercise equal to the Option price, or in a combination
         of cash and shares of Common Stock whose fair market value on the date
         of exercise together with such cash will equal the Option price. The
         Committee may also permit Participants, either on a selective or
         aggregate basis, simultaneously to exercise Options and to sell the
         shares of Common Stock thereby acquired pursuant to a brokerage or
         similar arrangement, approved in advance by the Committee and to use
         the proceeds from such sale as payment of the purchase price of such
         shares of Common Stock subject to the Option.

              (f) Tandem SARs. Each Award may provide for related SARs. To the
         extent an Award is exercised, in whole or in part, any Tandem SAR
         granted in respect of such Option (or part of such Option) will
         immediately terminate and cease to be exercisable. To the extent a
         Tandem SAR Award is exercised, in whole or in part, any accompanying
         Option will immediately terminate and cease

                                       6

         to be  exercisable  and the  shares  of  Common  Stock  covered  by the
         terminated  Option will not again be available  for Awards  pursuant to
         the Plan.

6.       AWARDS OF STOCK APPRECIATION RIGHTS (SARS)

         The terms and conditions with respect to each Award of SARs under the
Plan will be consistent with the following:

              (a) Awards of Tandem SARs. An Award of Options may provide for
         Tandem SARs. Alternatively, during the term of the Option, Tandem SARs
         for such Options may be awarded. A Tandem SAR will be exercisable only
         during the period in which the Option (or part of such Option) in
         respect of which such SAR was granted is exercisable. To the extent a
         Tandem SAR Award is exercised, in whole or in part, any accompanying
         Option will immediately terminate and cease to be exercisable and the
         shares of Common Stock covered by the terminated Option will not again
         be available for Awards pursuant to the Plan.

              (b) Awards of Freestanding SARs. Freestanding SARs may be awarded
         without an accompanying Option. Exercise of a Freestanding SAR may be
         conditioned upon completion of all or a part of a vesting schedule
         specified in the Award and/or the satisfaction of performance or other
         criteria as specified in the Award. The Freestanding SAR will be
         exercisable, in whole or in part, from time to time as stated in the
         Award.

              (c) Payment. When the vesting schedule and/or specified
         performance or other criteria have been satisfied, the Participant will
         be paid in accordance with the terms of the Award an amount in cash or
         in shares of Common Stock valued at fair market value on the date of
         exercise. Any payment which is made in shares of Common Stock will be
         valued at fair market value as of the last trading day of the week
         preceding the day of the Committee's determination to make payment in
         shares of Common Stock. The earned portion of an Award may be paid
         currently or on a deferred basis and may be credited with interest or
         an earnings equivalent as specified in the Award or as determined by
         the Committee.

7.       AWARDS OF RESTRICTED STOCK

         The terms and conditions with respect to each Award of Restricted Stock
under the Plan will be consistent with the following:

                                       7

              (a) Terms. The Award may specify a vesting schedule and
         performance or other criteria for each Award. The Restricted Stock will
         be forfeited to the extent the vesting schedule and/or specified
         performance or other criteria have not been satisfied, except as
         otherwise provided in the Plan or the Award.

              (b) Book-Entry Accounts. Restricted Stock will be held in
         book-entry accounts subject to the direction of Ormat (or if Ormat
         elects, certificates may be issued in the Participant's name but
         delivered to and held by Ormat). Unless the Committee determines
         otherwise at the time of the Award, any dividends that may be paid in
         cash or otherwise on the Restricted Stock will be delivered to and held
         by Ormat on the book-entry accounts or reinvested in Restricted Stock,
         at the discretion of the Committee, so long as the Restricted Stock
         remains subject to the restrictions of the vesting schedule and/or
         specified performance or other criteria.

              (c) Payment. When the vesting schedule and/or specified
         performance or other criteria have been satisfied, the Participant will
         have the right to direct the transfer of such Restricted Stock. In
         addition, the book-entry accounts will reflect that the Restricted
         Stock has been released. Certificates will be issued for the Restricted
         Stock (as Common Stock) and any dividends held by Ormat will also be
         delivered to the Participant. The Participant may be paid interest on
         the amount of cash dividends so delivered computed at the same rate and
         in the same manner as interest is credited from time to time on Ormat's
         corporate cash balances, as determined by the Committee.

8.       AWARDS OF STOCK UNITS

         The terms and conditions with respect to each Award of Stock Units
under the Plan will be consistent with the following:

              (a) Terms. The Award may specify a vesting schedule and
         performance or other criteria for each Award. No payment will be made
         under the Award to the extent the vesting schedule and/or specified
         performance or other criteria have not been satisfied, except as
         otherwise provided in the Plan or the Award.

              (b) Payment. Stock Units will be credited to an account to be
         maintained on behalf of the Participant. When the vesting schedule
         and/or specified performance or other criteria have been satisfied, the
         Participant will be paid in accordance with the terms of the Award in
         shares of Common Stock. Any payment made in shares of Common Stock will
         be valued at fair market value as

                                       8

         of  the  last  trading  day  of  the  week  preceding  the  day  of the
         Committee's  determination  to make payment in shares of Common  Stock.
         The earned  portion of an Award may be paid  currently or on a deferred
         basis and may be credited  with  interest or an earnings  equivalent as
         specified in the Award or as determined by the Committee.

9.       AWARDS OF PHANTOM STOCK

         The terms and conditions with respect to each Award of Phantom Stock
under the Plan will be consistent with the following:

              (a) Terms. The Award may specify a vesting schedule and
         performance or other criteria for each Award. No payment will be made
         under the Award to the extent the vesting schedule and/or specified
         performance or other criteria have not been satisfied, except as
         otherwise provided in the Plan or the Award.

              (b) Payment. Phantom Stock will be credited to an account to be
         maintained on behalf of the Participant. When the vesting schedule
         and/or specified performance or other criteria have been satisfied, the
         Participant will be paid in accordance with the terms of the Award an
         amount in cash equal to the fair market value of such Phantom Stock at
         such time. The earned portion of an Award may be paid currently or on a
         deferred basis and may be credited with interest or an earnings
         equivalent as specified in the Award or as determined by the Committee.

10.      AWARDS OF INCENTIVE BONUSES

         The terms and conditions with respect to each Award of an Incentive
Bonus under the Plan will be consistent with the following:

              (a) Terms. Incentive Bonuses will be credited to an account to be
         maintained on behalf of the Participant. The Award may specify a
         vesting schedule and performance or other criteria for each Award. No
         payment will be made under the Award to the extent the vesting schedule
         and/or specified performance or other criteria have not been satisfied,
         except as otherwise provided in the Plan or the Award.

              (b) Payment. When the vesting schedule and/or specified
         performance or other criteria have been satisfied, the Participant will
         be paid in accordance with the terms of the Award an amount in cash or
         in shares of Common Stock (or

                                       9

         Restricted  Stock). Any payment which is made in shares of Common Stock
         will be valued at fair market  value as of the last  trading day of the
         week preceding the day of the Committee's determination to make payment
         in shares of Common Stock.  The earned  portion of an Award may be paid
         currently or on a deferred  basis and may be credited  with interest or
         an earnings  equivalent  as specified in the Award or as  determined by
         the Committee.

11.      PERFORMANCE AWARDS

         The terms and conditions with respect to each Performance Award made by
the Grant Committee to key employees will be consistent with the following:

              (a) Description of Performance Award. The Committee or the Grant
         Committee (and in the case of Awards to Named Executive Officers, only
         the Grant Committee) may, from time to time, make Awards under this
         Section 11 of the Plan of Options, SARs, Restricted Stock, Stock Units,
         Phantom Stock, and Incentive Bonus Awards ("Performance Awards") to key
         employees in such form and having such terms, conditions and
         limitations as the Committee or the Grant Committee, as the case may
         be, may determine in order that such Performance Award constitutes
         qualified performance-based compensation under Code Section 162(m).
         Performance Awards may be granted singly, in combination or in tandem.

              (b) Performance Goals. Pursuant to this Section 11 of the Plan,
         for each Award of Restricted Stock, Stock Units, Phantom Stock and
         Incentive Bonus Awards, the Committee or the Grant Committee, as the
         case may be, will (on or before the 90th day of the applicable
         performance period) establish, in writing, a performance period,
         applicable performance goals and the performance objectives to be used
         in determining whether and to what extent Performance Awards will be
         deemed to be earned. The performance goals will be based on one or more
         of the following objective performance criteria selected by the
         Committee or the Grant Committee, as the case may be, to measure the
         performance of the Corporation: sales; gross margin; operating income;
         income before or after interest, taxes, depreciation or amortization;
         net income; basic or diluted earnings per share; return on capital;
         return on equity; return on assets; cash flow; working capital; stock
         price; total shareowner return; pretax income before allocation of
         corporate overhead and bonus; market share; gross profits; and/or
         reductions in costs. Such performance goals and performance objectives
         also may be based solely on the Corporation's performance or based on
         the relative performance of other companies or upon comparisons of any
         of the indicators of performance relative to other companies. Each such
         performance criterion will be determined in

                                       10

         accordance   with   generally   accepted   accounting   principles   as
         consistently  applied by the  Corporation  and, if so determined by the
         Committee or the Grant  Committee,  as the case may be, at the time the
         Performance  Award is made,  and to the  extent  permitted  under  Code
         Section 162(m),  adjusted to omit the effects of  extraordinary  items,
         gain  or  loss  on the  disposal  of a  business  segment,  unusual  or
         infrequently  occurring events and transactions and cumulative  effects
         of changes in accounting principles. Once established for a performance
         period,  Performance  Award  performance  goals  will not be amended or
         otherwise  modified if and to the extent such amendment or modification
         would cause the  compensation  payable pursuant to the Award to fail to
         constitute qualified performance-based  compensation under Code Section
         162(m).

              (c) Determination of Award Earned. A Participant will be eligible
         to receive payment in respect of a Performance Award only to the extent
         that the performance goals for that Performance Award are achieved. As
         soon as practicable after the close of each performance period, the
         Committee or the Grant Committee, as the case may be, will review and
         determine whether, and to what extent, the performance goals for the
         performance period have been achieved and, if so, determine the amount
         of the Performance Award earned by the Participant for such performance
         period. The Committee or the Grant Committee, as the case may be, will
         then determine the actual amount of the Performance Award to be paid to
         the Participant and, in so doing, may in its sole discretion decrease,
         but not increase, the amount of the Performance Award otherwise payable
         to the Participant based upon such performance.

              (d) Payment. Performance Awards will be paid as provided in the
         Plan, according to payment rules provided under each type of Award.

              (e) Performance Award Limitations. The shares of Common Stock
         underlying Performance Awards of Options, SARs, Restricted Stock, Stock
         Units and Phantom Stock made pursuant to this Section 11 of the Plan to
         any key employee in any fiscal year of Ormat may not exceed 400,000, as
         increased or decreased by Section 16, which limitation will be applied
         in a manner consistent with the requirements of Code Section 162(m).
         The maximum dollar amount of any Award of Incentive Bonuses granted
         pursuant to this Section 11 of the Plan that may be paid to any key
         employee in any fiscal year of Ormat may not exceed $10 million.

12.      DIVIDEND EQUIVALENTS

                                       11

         Any Awards (other than Awards of Options, SARs and Incentive Bonuses)
under the Plan may, in the discretion of the Committee, earn dividend
equivalents. In respect of any such Award which is outstanding on a dividend
record date for Common Stock, the Participant may be credited with an amount
equal to the cash or stock dividends or other distributions that would have been
paid on the shares of Common Stock covered by such Award had such covered shares
of Common Stock been issued and outstanding on such dividend record date. The
Committee will establish such rules and procedures governing the crediting of
dividend equivalents, including the timing, form of payment and payment
contingencies of such dividend equivalents, as it deems are appropriate or
necessary.

13.      EFFECT OF TERMINATION OF SERVICE

              (a) Termination of Service Upon Death or Retirement and Exercise
         of Award. If a Participant incurs a Termination of Service by reason of
         death or because of Retirement and the Participant (or a permitted
         transferee) holds an outstanding Award, such Participant will
         immediately forfeit any portion of the Award which has not yet vested,
         unless the Committee deems a certain portion of the Award will be
         considered vested, taking into account such other factors as in its
         sole discretion it deems appropriate. The portion of the Award that has
         not yet been exercised, if applicable, may be exercised from and after
         the date of the death or date of Retirement of the Participant for a
         period of one year (or until the expiration date specified in the Award
         if earlier) and only to the extent the Participant (or a permitted
         transferee) was entitled to exercise the Award at the time of the death
         or Retirement, unless and except to the extent the Committee determines
         to extend such period.

              (b) Termination of Service For Any Other Reason and Exercise of
         Award. If a Participant incurs a Termination of Service before the end
         of a vesting schedule for any reason other than death or Retirement,
         such Participant will immediately forfeit any portion of the Award
         which has not yet vested, unless the Committee deems a certain portion
         of the Award will be considered vested, taking into account such other
         factors as in its sole discretion it deems appropriate. The portion of
         the Award that has not yet been exercised, if applicable, may be
         exercised only within three months after the Termination of Service (or
         until the expiration date specified in the Award if earlier) and only
         to the extent the Participant (or a permitted transferee) was entitled
         to exercise the Award at the time of the Termination of Service, unless
         and except to the extent the Committee determines to extend such
         period.

14.      LIMITATIONS AND CONDITIONS

                                       12

              (a) Maximum Shares of Common Stock Available Under Plan As Awards.
         The total number of shares of Common Stock that may be made subject to
         Awards (all of which may be Options) under the Plan is 1,250,000 shares
         of Common Stock, subject to adjustment in accordance with Section 16 of
         the Plan. Such total number of shares of Common Stock may consist, in
         whole or in part, of unissued shares of Common Stock or reacquired
         shares of Common Stock. The specified number of shares of Common Stock
         may be increased or decreased by the events set forth in Section 16 of
         the Plan. If the Corporation makes an acquisition or is a party to a
         merger or consolidation and the Corporation assumes the Options or
         other awards consistent with the purpose of the Plan of the company
         acquired, merged or consolidated which are administered pursuant to the
         Plan, shares of Common Stock subject to the assumed Options or other
         awards will not count as part of the total number of shares of Common
         Stock that may be made subject to Awards under the Plan.

              (b) Reuse of Shares of Common Stock. Any shares of Common Stock
         that have been made subject to an Award that cease to be subject to the
         Award (other than by reason of exercise or payment of the Award to the
         extent that it is settled in shares of Common Stock) will again be
         available for an Award and will not be considered as having been
         previously made subject to an Award. Any shares of Common Stock
         delivered upon exercise of an Option in payment of all or part of the
         Option, or delivered or withheld in satisfaction of withholding taxes
         with respect to an Award, will be additional shares of Common Stock
         available for an Award under the Plan. After a Phantom Stock Award has
         been paid out, the shares of Common Stock underlying the Award will
         again be available for an Award and will not be considered as having
         been previously made subject to an Award.

              (c) Maximum Period. No Awards will be made under the Plan after
         November __,1* 2014, but the terms of Awards granted on or before the
         expiration date may extend beyond such expiration date. At the time an
         Award is granted or amended or the terms or conditions of an Award are
         changed, the Committee may provide for limitations or conditions on
         such Award.

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

*  Insert a date 10 years after the effective date of the Registration Statement
   for the Corporation's IPO.

                                       13

              (d) Transferability. No Award or portion of the Award will be
         transferable by a Participant otherwise than by will or by the laws of
         descent and distribution, except that an Option and Tandem SAR may be
         transferred pursuant to a domestic relations order or by gift to a
         family member of the holder to the extent permitted in the applicable
         Award. A Tandem SAR may never be transferred except to the transferee
         of the related Option. During the lifetime of the Participant, an Award
         will be exercisable only by the Participant unless it has been
         transferred to a family member of the holder, in which case it will be
         exercisable only by such transferee. For the purpose of this provision,
         a "family member" has the meaning set forth in the General Instructions
         to Form S-8 Registration Statement under the Securities Act of 1933.

              (e) No Rights as Shareholder. No person who receives an Award
         under the Plan which includes shares of Common Stock or the right to
         acquire shares of Common Stock (which may include shares of Restricted
         Stock pursuant to Section 7 of the Plan) will have any rights of a
         stockholder: (i) as to shares of Common Stock under Option until, after
         proper exercise of the Option, such shares of Common Stock have been
         recorded on Ormat's official stockholder records as having been issued
         or transferred; (ii) as to shares of Common Stock to be delivered
         following exercise of a SAR until, after proper exercise of the SAR and
         determination by the Committee to make payment for the SAR in shares of
         Common Stock, such shares of Common Stock will have been recorded on
         Ormat's official stockholder records as having been issued or
         transferred; or (iii) as to shares of Common Stock included in Awards
         of Restricted Stock, Stock Units or Incentive Bonuses, until such
         shares of Common Stock will have been recorded on Ormat's official
         stockholder records as having been issued or transferred, except for
         any dividend equivalent rights provided in Section 12 of the Plan.

              (f) Ormat's Obligations. Ormat will not be obligated to deliver
         any shares of Common Stock until they have been listed (or authorized
         for listing upon official notice of issuance) upon each stock exchange
         upon which outstanding shares of Common Stock at the time are listed or
         until there has been compliance with such laws or regulations as Ormat
         may deem applicable. Ormat will use its best efforts to effect such
         listing and compliance. No fractional shares of Common Stock will be
         delivered.

              (g) No Rights to Continue Status. Nothing contained in the Plan
         will affect the right of the Corporation to cause the Participant to
         incur a Termination of Service at any time or for any reason.

                                       14

              (h) ERISA. Notwithstanding any language in the Plan to the
         contrary, no deferral will be permitted under the Plan if it will
         result in the Plan becoming an "employee benefit plan" under Section
         3(3) of the Employee Retirement Income Security Act of 1974, as amended
         ("ERISA"). The Plan is not intended to constitute an employee benefit
         plan subject to ERISA.

15.      TRANSFERS AND LEAVES OF ABSENCE

         For purposes of the Plan: (a) a transfer of a Participant's employment,
transfer as a director or transfer as an independent contractor without an
intervening period from Ormat to a Subsidiary or another entity in which Ormat
owns, directly or indirectly, an equity interest or vice versa, or from one
Subsidiary or another entity in which Ormat owns, directly or indirectly, an
equity interest to another, or vice versa, will not be deemed a Termination of
Service and such Participant will be deemed to remain in the employ of the
Corporation, to remain a director of the Corporation or to remain an independent
contractor of the Corporation, and (b) a Participant who is granted in writing a
leave of absence will be deemed to have remained in the employ of the
Corporation, remained as a director of the Corporation, or remained as an
independent contractor to the Corporation.

16.      CORPORATE CHANGES, DIVESTITURES AND PLAN TERMINATION

              (a) Corporate Changes. If there is a merger, consolidation, stock
         or other non-cash dividend, extraordinary cash dividend, split-up,
         spin-off, combination or exchange of shares, reorganization or
         recapitalization or change in capitalization, or any other similar
         corporate event, the Committee may make such adjustments in: (i) the
         aggregate number of shares of Common Stock subject to the Plan and the
         number of shares of Common Stock that may be made subject to Awards to
         any individual Participant as well as the aggregate number of shares of
         Common Stock that may be made subject to any type of Award; (ii) the
         number and kind of shares of Common Stock that are subject to any
         Option (including any Option outstanding after Termination of Service)
         and the Option price per share without any change in the aggregate
         Option price to be paid for the Option upon exercise of the Option;
         (iii) the number and kind of SARs granted or that may be granted under
         the Plan; (iv) the number and kind of shares of outstanding Restricted
         Stock; (v) the number and kind of shares of Common Stock covered by
         Stock Units or Phantom Stock; and (vi) the number of outstanding
         dividend equivalents, as the Committee will deem appropriate in the
         circumstances. The determination by the Committee as to the terms of
         any such adjustments will be final, conclusive and binding.

                                       15

              (b) Divestitures. In the case of a Participant whose principal
         employer is a Subsidiary, he or she serves as a director on a
         Subsidiary's board of directors or he or she provides services to a
         Subsidiary as an independent contractor, then such Participant will be
         deemed to have incurred a Termination of Service for purposes of Awards
         as of the date on which such Subsidiary ceases to be a Subsidiary (the
         "Divestiture Date") and, except to the extent otherwise determined by
         the Committee and set forth in the applicable Award, with respect to
         Awards held by such Participant, the vesting schedule will be deemed
         satisfied as of the Divestiture Date, but only as to that portion of
         such Award as is equivalent to the portion of the vesting schedule
         applicable to the Award that has been satisfied as of the Divestiture
         Date without regard to this Section 16(b); as of the Divestiture Date,
         the portion of the Award as to which the vesting schedule is deemed
         satisfied pursuant to this Section 16(b) will become nonforfeitable and
         the other portion of the Award as to which the vesting schedule has not
         been satisfied will be forfeited. Payments under Awards, if any, will
         be determined in accordance with the provisions of Section 13 of the
         Plan.

              (c) Plan Termination. If the Plan terminates, then each
         Participant will be deemed to have incurred a Termination of Service
         solely for purposes of the Award as of the date of such termination of
         the Plan and, except to the extent otherwise determined by the
         Committee and set forth in the applicable Award, the provisions of
         Section 16(c) of the Plan will apply to such Participant's Award with
         the same effect as if the date of such termination of the Plan were a
         Divestiture Date. Payments under Awards, if any, will be determined in
         accordance with the provisions of Section 13 of the Plan.

                                       16

17.      AMENDMENT AND TERMINATION

               (a) Amendment. The Board of Directors has the power to amend the
         Plan, including the power to change the amount of the aggregate fair
         market value of the shares of Common Stock subject to Incentive Stock
         Options first exercisable in any calendar year under Section 5 of the
         Plan to the extent provided in Code Section 422, or any successor Code
         provision. The Board of Directors will not, however, except as
         otherwise provided in the Plan, without approval of the stockholders of
         Ormat, increase the maximum number of shares of Common Stock authorized
         for the Plan, nor reduce the basis upon which the minimum Option price
         is determined, nor extend the period within which Awards under the Plan
         may be granted, nor provide for an Option that is exercisable more than
         ten years from the date it is granted except if the Participant dies,
         nor amend Section 11 of the Plan relating to Performance Awards. The
         Board of Directors will have no power to change the terms of any Award
         previously granted under the Plan so as to impair the rights of a
         Participant without the consent of the Participant whose rights would
         be affected by such change except to the extent, if any, provided in
         the Plan or in the Award or except to the extent that the Board of
         Directors determines that such amendment is desirable or appropriate to
         comply with the requirements of Section 885 of the American Jobs
         Creation Act of 2004.

              (b) Termination. The Board of Directors may suspend or terminate
         the Plan at any time. No such suspension or termination will affect
         Options or SARs then in effect.

18.      AWARDS TO FOREIGN TAX ELIGIBLE INDIVIDUALS

         The Committee may grant Awards to Foreign Tax Eligible Individuals,
which Awards may have terms and conditions that differ from the terms provided
elsewhere in the Plan for the purpose of complying with the foreign tax laws.
The terms and conditions of the Awards will be specified in one or more subplans
to be approved by the Committee.

19.      WITHHOLDING TAXES

         The Corporation will have the right to deduct from any cash payment
made under the Plan any federal, state or local income or other taxes required
by law to be withheld with respect to such payment. It will be a condition to
the obligation of Ormat to deliver payment of Awards that upon such payment,
exercise or settlement the Participant pay to the Corporation such amount as may
be requested by the Corporation for the purpose of

                                       17

satisfying any liability for such withholding  taxes. Any Award may provide that
the  Participant  may elect, in accordance with any conditions set forth in such
Award to pay any withholding taxes in shares of Common Stock.

20.      Effective Date

         The Plan will be effective as of November __,* 2004 upon approval by
the Board of Directors and upon approval of the stockholders of Ormat.

--------
*  Insert a date 10 years after the effective date of the Registration Statement
   for the Corporation's IPO.

                                       18

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