-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 QPz80Gdpzku4mMp6cqNZJkcwGuXOJ+2VNV6Tn3IcDOD4hCFoqUssJRFXE4E7eMd5
 bf5SD7eVyjJ/nneOARDb8A==

<SEC-DOCUMENT>0000950130-01-000477.txt : 20010131
<SEC-HEADER>0000950130-01-000477.hdr.sgml : 20010131
ACCESSION NUMBER:		0000950130-01-000477
CONFORMED SUBMISSION TYPE:	S-8
PUBLIC DOCUMENT COUNT:		5
FILED AS OF DATE:		20010130
EFFECTIVENESS DATE:		20010130

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MIND CTI LTD
		CENTRAL INDEX KEY:			0001119083
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-COMPUTER PROGRAMMING SERVICES [7371]
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		S-8
		SEC ACT:		
		SEC FILE NUMBER:	333-54632
		FILM NUMBER:		1519445

	BUSINESS ADDRESS:	
		STREET 1:		INDUSTRIAL PARK BLDG 7 PO BOX 144
		CITY:			YOQNEAM ILIY 20692 I
		STATE:			L3
		ZIP:			00000
		BUSINESS PHONE:		0119724993
</SEC-HEADER>
<DOCUMENT>
<TYPE>S-8
<SEQUENCE>1
<FILENAME>0001.txt
<DESCRIPTION>FORM S-8
<TEXT>

<PAGE>

    As filed with the Securities and Exchange Commission on January 30, 2001
                       Registration No. 333-______________

================================================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM S-8

             REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

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

                                MIND C.T.I. LTD.
             (Exact name of registrant as specified in its charter)

           Israel                                         Not Applicable
(State or other jurisdiction of                  (I.R.S. Employer Identification
 incorporation or organization)                                Number)

                           Industrial Park, Building 7
                       P.O. Box 144, Yoqneam, Israel 20692
          (Address of principal executive offices, including zip code)


                     MIND C.T.I. LTD. 1998 SHARE OPTION PLAN

                     MIND C.T.I. LTD. 2000 SHARE OPTION PLAN
                            (Full title of the plans)

                                MIND C.T.I. INC.
                                777 Terrace Ave.
                       Hasbrouck Heights, New Jersey 07604
                                 (201) 288-3900
                            Facsimile: (201) 288-4590
 (Name, address of agent for service and telephone number, including area code
                             of agent for service)

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

   Copies of all communications, including all communications to the agent for
                          service, should be sent to:

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

                                 NEIL GOLD, ESQ.
                           FULBRIGHT & JAWORSKI L.L.P.
                                666 FIFTH AVENUE
                            NEW YORK, NEW YORK 10103
                                 (212) 318-3000

                                ---------------
                         CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>

====================================================================================================================================
                                       Amount to be        Proposed maximum          Proposed maximum          Amount of
 Title of Securities to be registered  Registered (1)      offering price per share  aggregate offering price  Registration fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S>                                 <C>                 <C>                      <C>                    <C>
 Ordinary shares, nominal value        240,680             $7.875  (2)               $1,895,355  (2)           $473.84
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
 Ordinary shares, nominal value        50,000              $0.15  (3)                $7,500  (3)               $1.88
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
 Ordinary shares, nominal value        224,220             $0.57  (4)                $127,805  (4)             $31.95
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
 Ordinary shares, nominal value        103,000             $1.25  (5)                $128,750  (5)             $32.19
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
 Ordinary shares, nominal value        218,200             $5.00  (6)                $1,091,000  (6)           $272.75
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S>                                 <C>                 <C>                      <C>                    <C>
 Ordinary shares, nominal value        1,240,900           $5.875  (7)               $7,290,288  (7)           $1,822.57
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
 Ordinary shares, nominal value        229,000             $10.00  (8)               $2,290,000  (8)           $572.50
 NIS 0.01 per share
- ------------------------------------------------------------------------------------------------------------------------------------
          Total                        2,306,000                                     $12,830,698               $3,207.68
====================================================================================================================================
</TABLE>

(1)    This registration statement shall also cover such additional
       indeterminable number of shares as may be required pursuant to the MIND
       C.T.I. Ltd. 1998 Share Option Plan and the MIND C.T.I. Ltd. 2000 Share
       Option Plan in the event of a stock dividend, stock split,
       recapitalization or other similar change in the Ordinary Shares.

(2)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on the average of the high and low prices of MIND's ordinary
       shares as reported on the Nasdaq Stock Market's National Market on
       January 24, 2001.

(3)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on an exercise price of $0.15 per share with respect to
       options granted to purchase 50,000 ordinary shares.

(4)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on an exercise price of $0.57 per share with respect to
       options granted to purchase 224,220 ordinary shares.

(5)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on an exercise price of $1.25 per share with respect to
       options granted to purchase 103,000 ordinary shares.

(6)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on an exercise price of $5.00 per share with respect to
       options granted to purchase 218,200 ordinary shares.

(7)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on an exercise price of $5.875 per share with respect to
       options granted to purchase 1,240,900 ordinary shares.

(8)    Estimated in accordance with Rule 457(h) under the Securities Act of
       1933, as amended, solely for the purpose of calculating the registration
       fee, based on an exercise price of $10.00 per share with respect to
       options granted to purchase 229,000 ordinary shares.
<PAGE>

                     AUTHORIZATION FROM THE STATE OF ISRAEL

         We have received from the Securities Authority of the State of Israel
an exemption from Israel's prospectus publication requirements in connection
with the employee benefit plans covered herein. Nothing in this exemption shall
be construed as authenticating the matters contained in this registration
statement, or as an approval of their reliability or adequacy, or as an
expression of opinion as to the quality of the securities offered by this
registration statement.
<PAGE>

                                     PART I

              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

     In accordance with the rules and regulations of the Securities and Exchange
Commission, the documents containing the information called for in Part I of
Form S-8 will be sent or given to individuals who participate in the MIND C.T.I.
Ltd. 1998 Share Option Plan and the MIND C.T.I. Ltd. 2000 Share Option Plan, as
the case may be, adopted by MIND C.T.I. Ltd. (the "Company") and are not being
filed with or included in this Form S-8.
<PAGE>

                                    PART II

              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference

         The following documents filed by the Company are incorporated herein by
         reference:

         (i)    The Company's Registration Statement on Form F-1 filed with the
                Commission on August 2, 2000.

         (ii)   Description of the Company's ordinary shares contained in Item 1
                of the Registration Statement on Form 8-A filed on August 2,
                2000.

         In addition to the foregoing, all documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a post-effective amendment
indicating that all of the securities offered hereunder have been sold or
deregistering all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated by reference in this Registration Statement shall be deemed to be
modified or superseded for purposes of this Registration Statement to the extent
that a statement contained herein or in any subsequently filed document that is
also incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.

Item 4.  Description of Securities

         Not applicable.

Item 5.  Interests of Named Experts and Counsel

         The validity of the shares being offered hereby will be passed upon for
us by Goldfarb, Levy, Eran & Co., Tel Aviv, Israel, our Israeli counsel.

Item 6.  Indemnification of Directors and Officers

         The Israeli Companies Law, 5759-1999 (the "Companies Law") permits a
company's articles of association to authorize the company to (i) prospectively
exculpate an officer or director from liability for damage resulting from such
officer's or director's breach of duty of care to the company, (ii) enter into a
contract to insure an officer or director for the breach of his duty of care or
to the extent that he acted in good faith and had a reasonable basis to believe
that one act would not prejudice the company, duty of loyalty or for monetary
liabilities charged against him as a result of an act or omission he committed
in connection with his serving as an officer or director and (iii) indemnify an
officer or director in connection with his service in that capacity for monetary
liability incurred as a result of an action brought against him by a third
party, as well as for reasonable expenses incurred in a civil action brought
against him by or on behalf of the company or by other third parties or, in
certain circumstances, in a criminal action.

                                     II-1
<PAGE>

         These provisions are specifically limited in their scope by the
Companies Law, which provides that a company may not indemnify an officer or
director nor enter into an insurance contract that would provide coverage for
any monetary liability incurred as a result of the following: (i) a breach by
the director or officer of his duty of loyalty unless he acted in good faith and
had a reasonable basis to believe that the act would not prejudice the company;
(ii) a breach by the director or officer of his duty of care if such breach was
done intentionally or in disregard of the circumstances of the breach or its
consequences; (iii) any act or omission done with the intent to derive an
illegal personal benefit; or (iv) any fine levied against the director or
officer as a result of a criminal offense.

         The Registrant has obtained liability insurance covering its officers
and directors.

         Article 70 of the Amended and Restated Articles of Association of the
Registrant provides as follows:

         "70.  Exculpation, Indemnity and Insurance

         (a) For purposes of these Articles, the term "Office Holder" shall mean
every Director and every officer of the Company, including, without limitation,
each of the persons defined as "Nosei Misra" in the Companies Law.

         (b) Subject to the provisions of the Companies Law, the Company may
prospectively exculpate an Office Holder from all or some of the Office Holder's
responsibility for damage resulting from the Office Holder's breach of the
Office Holder's duty of care to the Company.

         (c) Subject to the provisions of the Companies Law, the Company may
indemnify an Office Holder in respect of an obligation or expense specified
below imposed on the Office Holder in respect of an act performed in his
capacity as an Office Holder, as follows:

             (i)    a financial obligation imposed on him in favor of another
             person by a court judgment, including a compromise judgment or an
             arbitrator's award approved by court;

              (ii)  reasonable litigation expenses, including attorneys' fees,
              expended by an Office Holder or charged to the Office Holder by a
              court, in a proceeding instituted against the Office Holder by the
              Company or on its behalf or by another person, or in a criminal
              charge from which the Office Holder was acquitted, or in a
              criminal proceeding in which the Office Holder was convicted of an
              offense that does not require proof of criminal intent.

                  The Company may undertake to indemnify an Office Holder as
aforesaid, (aa) prospectively, provided that the undertaking is limited to
categories of events which in the opinion of the Board of Directors can be
foreseen when the undertaking to indemnify is given, and to an amount set by the
Board of Directors as reasonable under the circumstances and (bb) retroactively.

              (d) Subject to the provisions of the Companies Law, the Company
may enter into a contract for the insurance of all or part of the liability of
any Office Holder imposed on the

                                     II-2
<PAGE>

Office Holder in respect of an act performed in his capacity as an Office
Holder, in respect of each of the following:

          (i)   a breach of his duty of care to the Company or to another
          person;

          (ii)  a breach of his duty of loyalty to the Company, provided that
          the Office Holder acted in good faith and had reasonable cause to
          assume that such act would not prejudice the interests of the Company;

          (iii) a financial obligation imposed on him in favor of another
          person.

      (e) The provisions of Articles 70(a), 70(b) and 70(c) above are not
intended, and shall not be interpreted, to restrict the Company in any manner in
respect of the procurement of insurance and/or in respect of indemnification (i)
in connection with any person who is not an Office Holder, including, without
limitation, any employee, agent, consultant or contractor of the Company who is
not an Office Holder, and/or (ii) in connection with any Office Holder to the
extent that such insurance and/or indemnification is not specifically prohibited
under law; provided that the procurement of any such insurance and/or the
provision of any such indemnification shall be approved by the Audit Committee
of the Company."

Item 7.           Exemption from Registration Claimed

          Not Applicable.

Item 8.            Exhibits

          4.1.     MIND C.T.I. Ltd. 1998 Share Option Plan

          4.2.     MIND C.T.I. Ltd. 2000 Share Option Plan

          5        Opinion of Goldfarb, Levy, Eran & Co.

          23.1     Consent of Kesselman & Kesselman, a member of
                   Pricewaterhouse-Coopers LLP

          23.2     Consent of Goldfarb, Levy, Eran & Co. (included in Exhibit 5)

          24       Power of Attorney (included in signature page)

Item 9.            Undertakings

          (a)      The undersigned registrant hereby undertakes:

          (1)      To file, during any period in which offers or sales are being
         made, a post-effective amendment to this registration statement:

        (i)   To include any prospectus required by section 10(a)(3) of the
        Securities Act of 1933;

                                     II-3
<PAGE>

        (ii)  To reflect in the prospectus any facts or events arising after the
        effective date of the Registration Statement (or the most recent post-
        effective amendment thereof) which, individually or in the aggregate,
        represent a fundamental change in the information in the registration
        statement. Notwithstanding the foregoing, any increase or decrease in
        volume of securities offered (if the total dollar value of securities
        offered would not exceed that which was registered) and any deviation
        from the low or high end of the estimated maximum offering range may be
        reflected in the form of prospectus filed with the Commission pursuant
        to Rule 424(b) if, in the aggregate, the changes in volume and price
        represent no more than 20 percent change in the maximum aggregate
        offering price set forth in the "Calculation of Registration Fee" table
        in the effective registration statement;

        (iii) To include any material information with respect to the plan of
        distribution not previously disclosed in the registration statement or
        any material change to such information in the registration statement;

   provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
   the registration statement is on Form S-3 or Form S-8, and the information
   required to be included in a post-effective amendment by those paragraphs is
   contained in periodic reports filed by the registrant pursuant to Section 13
   or 15(d) of the Securities Exchange Act of 1934 that are incorporated by
   reference in the registration statement.

   (2) That, for the purpose of determining any liability under the Securities
   Act of 1933, each such post-effective amendment shall be deemed to be a new
   registration statement relating to the securities offered therein, and the
   offering of such securities at that time shall be deemed to be the initial
   bona fide offering thereof.

   (3) To remove from registration by means of a post-effective amendment any of
   the securities being registered which remain unsold at the termination of the
   offering.

   (b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

   (c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the registrant in the successful

                                     II-4
<PAGE>

defense of any action, suit or proceeding) is asserted by such director,
officer, or controlling person of the registrant in connection with the
securities being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.


                                     II-5
<PAGE>

                                   SIGNATURES

(a) Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Tel Aviv on the 28th day of January, 2001.

                                      MIND C.T.I. Ltd.

                                      By: /s/ Monica Eisinger
                                          ----------------------------------
                                          Monica Eisinger
                                          President and Chief Executive
                                          Officer

                                POWER OF ATTORNEY

(b) KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature appears
below constitutes and appoints Monica Eisinger and Yaron Amir, or either of
them, the undersigned's true and lawful attorney-in-fact and agent with full
power of substitution and resubstitution, for him or her and in his or her name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and any
registration statement relating to the offering hereunder pursuant to Rule 462
under the Securities Act of 1933, as amended, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting said attorney-in-fact and agent,
and each of them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in connection therewith as fully to
all intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent or either of
them, or their or his or her substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.

(c) Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>

Signature                                               Title                                   Date
- ---------                                               -----                                   ----
<S>                                                  <C>                                      <C>
/s/ Monica Eisinger                                     President                               January28, 2001
- ---------------------------------------------------
Monica Eisinger

/s/ Elad Naggar                                         Chief Financial Officer (principal      January 28, 2001
- ---------------------------------------------------
Elad Naggar                                             financial and accounting officer)

/s/ Lior Salansky                                       Director                                January 28, 2001
- ---------------------------------------------------
Lior Salansky

/s/ Ilan Rosen                                          Director                                January 28, 2001
- ---------------------------------------------------
Ilan Rosen

/s/ Kevin Mohan                                         Director                                January 28, 2001
- ---------------------------------------------------
Kevin Mohan

Authorized Representative in the United States:
   MIND C.T.I. Inc.

By:  /s/ Ilan Melamed                                   Vice President, U.S., Operations        January 28, 2001
     ----------------------------------------------
     Ilan Melamed
</TABLE>
<PAGE>

                                INDEX TO EXHIBITS

     Exhibit
       No.          Description
     -------        -----------
       4.1          MIND C.T.I. Ltd. 1998 Stock Option Plan
       4.2          MIND C.T.I. Ltd. 2000 Stock Option Plan
        5           Opinion of Goldfarb, Levy, Eran & Co.
      23.1          Consent of Kesselman & Kesselman, a member of
                    PricewaterhouseCoopers, LLP
      23.2          Consent of Goldfarb, Levy, Eran & Co. (included in
                    Exhibit 5)
      24            Power of Attorney (included in signature page)
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>2
<FILENAME>0002.txt
<DESCRIPTION>1998 SHARE OPTION PLAN
<TEXT>

<PAGE>

                                                                     EXHIBIT 4.1





                                MIND C.T.I. LTD.
                                      1998
                                    RESTATED
                               SHARE OPTION PLAN


<PAGE>

                                MIND C.T.I. LTD.
                                     1998
                               SHARE OPTION PLAN



1.  NAME

    This Plan, as amended from time to time, shall be known as the Mind 1998
Share Option Plan (the "Option Plan").

2.  PURPOSE OF THE OPTION PLAN

    The Option Plan is intended as an incentive to retain, in the employ of Mind
C.T.I. Ltd. (the "Company") and its subsidiaries, persons of training,
experience, and ability, to attract new employees, whose services are considered
valuable, to encourage the sense of proprietorship of such persons, and to
stimulate the active interest of such persons in the development and financial
success of the Company by providing them with opportunities to purchase shares
in the Company, pursuant to the Option Plan approved by the board of directors
of the company (the "Board"), which is designed to benefit from, and is made
pursuant to, the provisions of Section 102 of the Israeli Income Tax Ordinance
(New Version) 1961 and any regulations, rules, orders of procedures promulgated
thereunder ("Section 102") with respect to Options granted to employees of the
Company pursuant to the Option Plan (the "Options"). The Option Plan is also
intended to fulfill certain previous obligations of the Company to certain
employees.

3.  ADMINISTRATION OF THE OPTION PLAN

    The Board or a share option committee appointed and maintained by the Board
for such purpose (the "Committee") shall have the power to administer the Option
Plan. Notwithstanding the above, the Board shall automatically have a residual
authority if no Committee shall be constituted or if such Committee shall cease
to operate for any reason whatsoever.

    The Committee shall consist of such number of members (not less than two (2)
in number) as may be fixed by the Board. The Committee shall select one of its
members as its chairman (the "Chairman") and shall hold its meetings at such
times and places as the Chairman shall determine. The Committee shall keep
records of its meetings and shall make such rules and regulations for the
conduct of its business as it shall deem advisable.

    Any member of such Committee shall not be eligible to receive Options under
the Option Plan while serving on the Committee, unless otherwise specified
herein.

    The Committee shall have full power and authority (i) to designate
participants; (ii) to determine the terms and provisions of respective Option
agreements (which need not be identical) including, but not limited to, the
number of shares in the Company to be covered by each Option, provisions
concerning the time or times when and the extent to which the Options may be
exercised and the nature and duration of restrictions as to transferability or
restrictions constituting substantial risk of forfeiture; (iii) to accelerate
the right of an Optionee to exercise, in whole or in part, any previously
granted Option; (iv) to interpret the


<PAGE>

provisions and supervise the administration of the Option Plan; and - (v) to
determine any other matter which is necessary or desirable for, or incidental to
administration of the Option Plan.

    All decisions and selections made by the Board or the Committee pursuant to
the provisions of the Option Plan shall be made by a majority of its members
except that no member of the Board or the Committee shall vote on, or be counted
for quorum purposes, with respect to any proposed action of the Board or the
Committee relating to any Option to be granted to that member. Any decision
reduced to writing and signed by a majority of the members who are authorized to
make such decision shall be fully effective as if it had been made by a majority
at a meeting duly held.

    The interpretation and construction by the Committee of any provision of the
Option Plan or of any Option thereunder shall be final and conclusive unless
otherwise determined by the Board.

    Subject to the Company decision, each member of the Board or the Committee
shall be indemnified and held harmless by the Company against any cost or
expense (including counsel fees) reasonably incurred by him, or any liability
(including any sum paid in settlement of a claim with the approval of the
Company) arising out of any act or omission to act in connection with the Option
Plan unless arising out of such member's own fraud or bad faith, to the extent
permitted by applicable law. Such indemnification shall be in addition to any
rights of indemnification the member may have as a director or otherwise under
the Company's Articles of Association, any agreement, any vote of shareholders
or disinterested directors, insurance policy or otherwise.

4.   DESIGNATION OF PARTICIPANTS

    The persons eligible for participation in the Option Plan as recipients of
Options shall include any employees of the Company or of any subsidiary of the
Company. The grant of an Option hereunder shall neither entitle the recipient
thereof to participate nor disqualify him from participating in, any other grant
of Options pursuant to this Option Plan or any other option or stock plan of the
Company or any of its affiliates. The Company reserves its right to issue an
additional option plan for non-Israeli employees, that the Company may employ in
the future.

    Anything in the Option Plan to the contrary notwithstanding, all grants of
Options to directors and office holders ("Nosei Misra" - as such term is defined
in the Companies Ordinance (New Version), 1983 - the "Companies Ordinance")
shall be authorized and implemented only in accordance with the provisions of
the Companies Ordinance, as in effect from time to time.

5.   TRUSTEE

    The Options which shall be granted to employees of the Company (and/or any
subsidiary thereof) and/or any Shares (as defined below) issued upon exercise of
such Options and/or other shares received subsequently following any realization
of rights, shall be issued to a Trustee nominated by the Committee, and approved
in accordance with the provisions of Section 102 - (the "Trustee") and held for
the benefit of the Optionees for a period of not less than two years (24 months)
from the date of grant, or such other period as shall be required in order to
comply with the provisions of Section 102 as amended from time to time,.

                                     Page 3
<PAGE>

    Anything to the contrary notwithstanding, the Trustee shall not release any
Options and/or any Shares issued upon exercise of Options, prior to the full
payment of the Optionee's tax liabilities arising from Options which were
granted to him and/or any Shares issued upon exercise of such Options.

    Upon receipt of the Option, the Optionee will sign an undertaking to exempt
the Trustee from any liability in respect of any action or decision duly taken
and bona fide executed in relation with the Option Plan, or any Option or Share
granted to him thereunder.

6.   SHARES RESERVED FOR THE OPTION PLAN

     Subject to adjustments as set forth in Section 8 below, a total of
     2,308,000 (two million, three hundred and eight thousand) Ordinary Shares,
     of NIS 0.01 par value (the "Shares") shall be subject to the Option Plan.
     The Shares subject to the Option Plan are hereby reserved for such purpose
     in the authorized share capital of the Company and may only be issued in
     accordance with the terms hereof. Any of such Shares which may remain
     unissued and which are not subject to outstanding Options at the
     termination of the Option Plan shall cease to be reserved for the purpose
     of the Option Plan, but until termination of the Option Plan the Company
     shall at all times reserve a sufficient number of Shares to meet the
     requirements of the Option Plan. Should any Option for any reason expire or
     be canceled prior to its exercise or relinquishment in full, the Shares
     therefore subject to such Option may again be subjected to an Option under
     the Option Plan.

7.   OPTION PRICE

     7.1. The purchase price of each Share subject to an Option or any portion
          thereof shall be determined by the Committee in its sole and absolute
          discretion in accordance with applicable law, subject to any
          guidelines as may be determined by the Board from time to time. As of
          the date of adoption of the Option Plan, the Board has instructed the
          Committee to determine the purchase price of each Share, at a price
          which is not less then the price per share, according to the most
          recent evaluation of the Company in any investment or other capital
          transaction.


     7.2. The Option price shall be payable upon the exercise of the Option in
          a form satisfactory to the Committee and conforming to Section 102,
          including without limitation, by cash or cheque. The Committee shall
          have the authority to postpone the date of payment on such terms as it
          may determine.

8.   ADJUSTMENTS

     Upon the occurrence of any of the following described events, Optionee's
     rights to purchase Shares under the Option Plan shall be adjusted as
     hereafter provided:

     8.1. If the outstanding shares of the Company shall at anytime be changed
          or exchanged by declaration of a stock dividend, stock split,
          combination or exchange of shares, recapitalization, or any other like
          event by or of the Company, and as often as the same shall occur, then
          the number, class and kind of Shares subject to this Option Plan or
          subject to any Options therefore

                                     Page 4
<PAGE>

          granted, and the Option prices, shall be appropriately and equitably
          adjusted so as to maintain the proportionate number of Shares without
          changing the aggregate Option price, provided, however, that no
          adjustment shall be made by reason of the distribution of subscription
          rights on outstanding stock or by reason of conversion of any
          Management Shares or preferred shares of the Company into Ordinary
          Shares (regardless of the ratio of such conversion). Upon occurrence
          of any of the foregoing, the class and aggregate number of Shares
          issuable pursuant to the Option Plan (as set forth in paragraph 6
          hereof), in respect of which Options have not yet been exercised,
          shall be appropriately adjusted, all as will be determined by the
          Board who's determination shall be final.

          Anything herein to the contrary notwithstanding, if prior to the
          completion of an initial public offering of the Company's securities
          ("IPO"), all or substantially all of the shares of the Company are to
          be sold, or upon a merger or reorganization or the like, the shares of
          the Company, or any class thereof, are to be exchanged for securities
          of another Company, then in such event, each Optionee shall be obliged
          to sell or exchange, as the case may be, the shares such Optionee
          purchased under the Option Plan, in accordance with the instructions
          then issued by the Board whose determination shall be final. Upon the
          occurrence of any such transactions, all unexersized Options shall be
          immediately and completely terminated.

9.   TERM AND EXERCISE OF OPTIONS

     9.1. Options shall be exercised by the Optionee by giving written notice
          to the Company, in such form and method as may be determined by the
          Company and the Trustee and conforming Section 102, which exercise
          shall be effective upon receipt of such notice by the Company at its
          principal office. The notice shall specify the number of Shares with
          respect to which the Option is being exercised.


     9.2. Each Option granted under this Option Plan shall be exercisable only
          following the vesting dates and for the number of Shares as shall be
          provided in Exhibit B to the Option agreement (the "Expiration Date").
          However no Option shall be exercisable after the Expiration Date, as
          defined for each Optionee in his Option agreement.


     9.3. Options granted under the Option Plan shall not be transferable by
          Optionees other than by will or laws of descent and distribution, and
          during an Optionee's lifetime shall be exercisable only by that
          Optionee.


     9.4. The Options may be exercised by the Optionee in whole at any time or
          in part from time to time, to the extent that the Options become
          vested, prior to the Expiration Date, and provided that, subject to
          the provisions of Section 9.6 below, the Optionee is an employee of
          the Company or any of its subsidiaries, at all times during the period
          beginning with the granting of the Option and ending upon the date of
          exercise of the relevant Options.

     9.5. Subject to the provisions of Section 9.6 below, in the event of
          termination of the Optionee's employment with the Company or any of
          its subsidiaries, all Options granted to him, which have not yet been
          exercised, will immediately

                                     Page 5
<PAGE>

          expire. A notice of termination of employment by either the Company or
          the Optionee shall be deemed to constitute termination of employment.

     9.6. Notwithstanding anything to the contrary hereinabove, an Option may
          be exercised after the date of termination of Optionee's employment
          with the Company or any subsidiary of the Company during an additional
          period of time beyond the date of such termination, but only with
          respect to the number of Options vested at the time of such
          termination, according to the vesting periods of the Options, set
          forth in Section 10 below, if: (i) termination is without Cause (as
          defined below), for a period of three (3) months from the termination
          of Employment, (ii) termination is the result of death or disability
          of the Optionee, in which event any Options still in force and
          unexpired may be exercised within a period of one year from the date
          of termination, but only with respect to the number of Options already
          vested at the time of such termination according to the vesting
          periods of the Options. The term "Cause" shall mean any action,
          omission or state of affairs related to the Optionee which the Board
          decides, in its sole discretion, is against the interests of the
          Company.

     9.7. The holders of Options shall not have any of the rights or privileges
          of shareholders of the Company in respect of any Shares purchasable
          upon the exercise of any part of an Option unless and until, following
          exercise but subject always to the provisions of Section 5 above,
          registration of the Optionee as holder of such Shares in the Company's
          register of members.


     9.8. Any form of Option agreement authorized by the Option Plan may
          contain such other provisions as the Committee may, from time to time,
          deem advisable.

10.  VESTING OF OPTIONS

     Notwithstanding anything to the contrary, any Option may be exercised only
     to the extent that such Option was vested. Each option granted hereunder
     shall be vested, in whole or in part, as determined by the Committee in its
     sole and absolute discretion, provided that the Optionee is an employee of
     the Company or any of its subsidiaries, at all times during the period
     beginning with the granting of the Option and ending upon the date of
     vesting of any portion of the Option.

11.  DIVIDENDS

     With respect to all Shares (in contrary to unexercised Options) issued upon
     the exercise of Options purchased by the Optionee and held by the Trustee,
     the Optionee shall be entitled to receive dividends in accordance with the
     quantity of such Shares, and subject to any applicable taxation on
     distribution of dividends. During the period in which Shares issued to the
     Trustee on behalf of an Optionee are held by the Trustee, the cash
     dividends paid with respect thereto shall be paid directly to the Optionee.

12.  ASSIGNABILITY AND SALE OF OPTIONS

     No Option, purchasable hereunder, whether fully paid or not, shall be
     assignable, transferable or given as collateral or any right with respect
     to them given to any third party whatsoever, and during the lifetime of the
     Optionee each and all of such

                                     Page 6
<PAGE>

     Optionee's rights to purchase Shares hereunder shall be exercisable only by
     the Optionee.

     As long as the Shares are held by the Trustee in favor of the Optionee,
     then all rights of the optionee possessed in the Shares are personal, can
     not be transferred, assigned, pledged or mortgaged, other than by will or
     laws of descent and distribution.

13.  TERM OF THE OPTION PLAN

     The Option Plan shall be effective as of the day it was adopted by the
     Board and shall terminate at the end of ____ months from such day of
     adoption.

14.  AMENDMENTS OR TERMINATION

     The Board may, at any time and from time to time, amend, alter or
     discontinue the Option Plan, except that no amendment or alteration shall
     be made which would impair the rights of the holder of any Option therefore
     granted, without his consent.

15.  GOVERNMENT REGULATIONS

     The Option Plan, and the granting and exercise of Options hereunder, and
     the obligation of the Company to sell and deliver Shares under such
     Options, shall be subject to all applicable laws, rules, and regulations,
     whether of the State of Israel or of the United States or any other State
     having jurisdiction over the Company and the Optionee, including the
     registration of the Shares under the United States Securities Act of 1933,
     and to such approvals by any governmental agencies or national securities
     exchanges as may be required.

16.  CONTINUANCE OF EMPLOYMENT

     Neither the Option Plan nor the Option agreement with the Optionee shall
     impose any obligation on the Company or a subsidiary thereof, to continue
     any Optionee in its employ, and nothing in the Option Plan or in any Option
     granted pursuant thereto shall confer upon any Optionee any right to
     continue in the employ of the Company or a subsidiary thereof or restrict
     the right of the Company or a subsidiary thereof to terminate such
     employment at any time.

17.  GOVERNING LAW AND JURISDICTION

     This Option Plan shall be governed by and construed and enforced in
     accordance with the laws of the State of Israel applicable to contracts
     made and to be performed therein, without giving effect to the principles
     of conflict of laws. The competent courts of Tel-Aviv, Israel shall have
     sole jurisdiction in any matters pertaining to this Option Plan.

18.  ARBITRATION

     Any dispute in relation with this Option Plan and the exercise of rights
     thereunder, shall be brought to arbitration of the legal counsel to the
     Company (the "Arbitrator"), who shall decide on such dispute in accordance
     with the provisions of

                                     Page 7
<PAGE>

     the Arbitration Law - 1968 and its supplement. The decision of the
     Arbitrator shall be final and shall bind the Company and the Optionee.

19.  TAX CONSEQUENCES

     Any tax consequences arising from the grant or exercise of any Option, from
     the payment for Shares covered thereby or from any other event or act (of
     the Company, the Trustee or the Optionee), hereunder, shall be borne solely
     by the Optionee. The Company and/or the Trustee shall withhold taxes
     according to the requirements under the applicable laws, rules, and
     regulations, including withholding taxes at source. Furthermore, the
     Optionee shall agree to indemnify the Company and the Trustee and hold them
     harmless against and from any and all liability for any such tax or
     interest or penalty thereon, including without limitation, liabilities
     relating to the necessity to withhold, or to have withheld, any such tax
     from any payment made to the Optionee.

     The Committee and/or the Trustee shall not be required to release any Share
     certificate to an Optionee until all required payments have been fully
     made.

20.  NON-EXCLUSIVITY OF THE OPTION  PLAN

     The adoption of the Option Plan by the Board shall not be construed as
     amending, modifying or rescinding any previously approved incentive
     arrangements or as creating any limitations on the power of the Board to
     adopt such other incentive arrangements as it may deem desirable,
     including, without limitation, the granting of stock Options otherwise then
     under the Option Plan, and such arrangements may be either applicable
     generally or only in specific cases. For the avoidance of doubt, prior
     grants of options to employees of the Company under their employment
     agreements, and not in the framework of any previous option plan, shall not
     be deemed an approved incentive arrangement for the purpose of this
     Section.

21.  MULTIPLE AGREEMENTS

The terms of each Option may differ from other Options granted under the Option
Plan at the same time, or at any other time. The Committee may also grant more
than one Option to a given Optionee during the term of the Option Plan, either
in addition to, or in substitution for, one or more Options previously granted
to that Optionee.

                                     Page 8
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2
<SEQUENCE>3
<FILENAME>0003.txt
<DESCRIPTION>2000 SHARE OPION PLAN
<TEXT>

<PAGE>

                                                                     EXHIBIT 4.2

                                MIND C.T.I. LTD.
                             2000 SHARE OPTION PLAN

1  NAME
     This Plan, as amended from time to time, shall be known as the Mind 2000
     Share Option Plan (the "Option Plan").

     This plan is consequential to the Mind 1998 Stock Option Plan (the "1998
     Option Plan").

2  PURPOSE OF THE OPTION PLAN

     The Option Plan is intended as an incentive to retain, in the employ or in
     the service of Mind C.T.I. Ltd. (the "Company") and its subsidiaries,
     persons of training, experience, and ability, to attract new employees and
     key officers (including non-Israeli employees and key officers), whose
     services are considered valuable, to encourage the sense of proprietorship
     of such persons, and to stimulate the active interest of such persons in
     the development and financial success of the Company by providing them with
     opportunities to purchase shares in the Company, pursuant to the Option
     Plan approved by the board of directors of the Company (the "Board")  The
     Option Plan is also intended to fulfill certain previous obligations of the
     Company to certain employees, directors and key officers.

3  ADMINISTRATION OF THE OPTION PLAN

     The Board or a share option committee appointed and maintained by the Board
     for such purpose (the "Committee") shall have the power to administer the
     Option Plan. Notwithstanding the above, the Board shall automatically have
     a residual authority if no Committee shall be constituted or if such
     Committee shall cease to operate for any reason whatsoever.

     The Committee shall consist of such number of members (not less than two
     (2) in number) as may be fixed by the Board. The Committee shall select one
     of its members as its chairman (the "Chairman") and shall hold its meetings
     at such times and places as the Chairman shall determine. The Committee
     shall keep records of its meetings and shall make such rules and
     regulations for the conduct of its business as it shall deem advisable.

     The Committee shall have full power and authority (i) to designate
     participants; (ii) to determine the terms and provisions of respective
     Option agreements (which need not be identical) including, but not limited
     to, the number of shares in the Company to be covered by each Option,
     provisions concerning the time or times when and the extent to which the
     Options may be exercised and the nature and duration of restrictions as to
     transferability or restrictions constituting substantial risk of
     forfeiture; (iii) to accelerate the right of an Optionee to exercise, in
     whole or in part, any previously granted Option; (iv) to interpret the
     provisions and supervise the administration of the Option Plan; and - (v)
     to determine any other matter which is necessary or desirable for, or
     incidental to administration of the Option Plan.

     All decisions and selections made by the Board or the Committee pursuant to
     the provisions of the Option Plan shall be made by a majority of its
     members except that no member of the Board or the Committee shall vote on,
     or be counted for quorum purposes, with respect to any proposed action of
     the Board or the Committee relating to any Option to be granted to that
     member. Any decision reduced to writing and signed by a majority of the
     members who are authorized to make such decision shall be fully effective
     as if it had been made by a majority at a meeting duly held.

     The interpretation and construction by the Committee of any provision of
     the Option Plan or of any Option thereunder shall be final and conclusive
     unless otherwise determined by the Board.

     Subject to the Company decision, each member of the Board or the Committee
     shall be indemnified and held harmless by the Company against any cost or
     expense (including counsel fees) reasonably incurred

                                                                               1
<PAGE>

     by him, or any liability (including any sum paid in settlement of a claim
     with the approval of the Company) arising out of any act or omission to act
     in connection with the Option Plan unless arising out of such member's own
     fraud or bad faith, to the extent permitted by applicable law. Such
     indemnification shall be in addition to any rights of indemnification the
     member may have as a director or otherwise under the Company's Articles of
     Association, any agreement, any vote of shareholders or disinterested
     directors, insurance policy or otherwise.

4  DESIGNATION OF PARTICIPANTS

     The persons eligible for participation in the Option Plan as recipients of
     Options shall include any employees, directors or key officers of the
     Company or of any subsidiary of the Company. The grant of an Option
     hereunder shall neither entitle the recipient thereof to participate nor
     disqualify him from participating in, any other grant of Options pursuant
     to this Option Plan or any other option or stock plan of the Company or any
     of its affiliates.

     Anything in the Option Plan to the contrary notwithstanding, all grants of
     Options to directors and office holders ("Nosei Misra" - as such term is
     defined in the Companies Act, 1999 - the "Companies Act") shall be
     authorized and implemented only in accordance with the provisions of the
     Companies Act, as in effect from time to time.

5  SHARES RESERVED FOR THE OPTION PLAN

     Subject to adjustments as set forth in Section 7 below, a total of
     2,308,000 (two million, three hundred and eight thousand) Ordinary Shares,
     --------------------------------------------------------
     of NIS 0.01 par value (the "Shares") shall be subject to the Option Plan
     and the 1998 Option Plan. The Shares subject to the Option Plan are hereby
     reserved for such purpose in the authorized share capital of the Company
     and may only be issued in accordance with the terms hereof. Any of such
     Shares which may remain unissued and which are not subject to outstanding
     Options at the termination of the Option Plan shall cease to be reserved
     for the purpose of the Option Plan, but until termination of the Option
     Plan the Company shall at all times reserve a sufficient number of Shares
     to meet the requirements of the Option Plan. Should any Option for any
     reason expire or be canceled prior to its exercise or relinquishment in
     full, the Shares therefore subject to such Option may again be subjected to
     an Option under the Option Plan.

6  OPTION PRICE

   6.1  The purchase price of each Share subject to an Option or any portion
        thereof shall be determined by the Committee in its sole and absolute
        discretion in accordance with applicable law, subject to any guidelines
        as may be determined by the Board from time to time. As of the date of
        adoption of the Option Plan, the Board has instructed the Committee to
        determine the purchase price of each Share, at a price which is not less
        then the price per share, according to the most recent evaluation of the
        Company in any investment or other capital transaction.

   6.2  The Option price shall be payable upon the exercise of the Option in a
        form satisfactory to the Committee , including without limitation, by
        cash or cheque. The Committee shall have the authority to postpone the
        date of payment on such terms as it may determine.

7  ADJUSTMENTS

     Upon the occurrence of any of the following described events, Optionee's
     rights to purchase Shares under the Option Plan shall be adjusted as
     hereafter provided:

   7.1  If the outstanding shares of the Company shall at anytime be changed or
        exchanged by declaration of a stock dividend, stock split, combination
        or exchange of shares,

                                                                               2
<PAGE>

        recapitalization, or any other like event by or of the Company, and as
        often as the same shall occur, then the number, class and kind of Shares
        subject to this Option Plan or subject to any Options therefore granted,
        and the Option prices, shall be appropriately and equitably adjusted so
        as to maintain the proportionate number of Shares without changing the
        aggregate Option price, provided, however, that no adjustment shall be
        made by reason of the distribution of subscription rights on outstanding
        stock or by reason of conversion of any Management Shares of the Company
        into Ordinary Shares (regardless of the ratio of such conversion). Upon
        occurrence of any of the foregoing, the class and aggregate number of
        Shares issuable pursuant to the Option Plan (as set forth in paragraph 6
        hereof), in respect of which Options have not yet been exercised, shall
        be appropriately adjusted, all as will be determined by the Board who's
        determination shall be final.

   7.2  Anything herein to the contrary notwithstanding, if prior to the
        completion of an initial public offering of the Company's securities
        ("IPO"), all or substantially all of the shares of the Company are to be
        sold, or upon a merger or reorganization or the like, the shares of the
        Company, or any class thereof, are to be exchanged for securities of
        another Company, then in such event, each Optionee shall be obliged to
        sell or exchange, as the case may be, the shares such Optionee purchased
        under the Option Plan, in accordance with the instructions then issued
        by the Board whose determination shall be final. Upon the occurrence of
        any such transactions, all unexercized Options shall be immediately and
        completely terminated.

8  TERM AND EXERCISE OF OPTIONS

   8.1  Options shall be exercised by the Optionee by giving written notice to
        the Company, in such form and method as may be determined by the Company
        , which exercise shall be effective upon receipt of such notice by the
        Company at its principal office. The notice shall specify the number of
        Shares with respect to which the Option is being exercised.

   8.2  Each Option granted under this Option Plan shall be exercisable only
        following the vesting dates and for the number of Shares as shall be
        provided in Exhibit B to the Option agreement (the "Expiration Date").
        However no Option shall be exercisable after the Expiration Date, as
        defined for each Optionee in his Option agreement.

   8.3  Options granted under the Option Plan shall not be transferable by
        Optionees other than by will or laws of descent and distribution, and
        during an Optionee's lifetime shall be exercisable only by that
        Optionee.

   8.4  The Options may be exercised by the Optionee in whole at any time or in
        part from time to time, to the extent that the Options become vested,
        prior to the Expiration Date, and provided that, subject to the
        provisions of Section 8.6 below, the Optionee is an employee, director
        or key officer of the Company or any of its subsidiaries, at all times
        during the period beginning with the granting of the Option and ending
        upon the date of exercise of the relevant Options.

   8.5  Subject to the provisions of Section 8.6 below, in the event of
        termination of the Optionee's employment or relationship with the
        Company or any of its subsidiaries, all Options granted to him, which
        have not yet been exercised, will immediately expire. A notice of
        termination

                                                                               3
<PAGE>

        of employment or relationship by either the Company or the Optionee
        shall be deemed to constitute termination of employment or relationship,
        as the case may be.

   8.6  Notwithstanding anything to the contrary hereinabove, an Option may be
        exercised after the date of termination of Optionee's employment or
        relationship with the Company or any subsidiary of the Company during an
        additional period of time beyond the date of such termination, but only
        with respect to the number of Options vested at the time of such
        termination, according to the vesting periods of the Options, set forth
        in Section 9 below, if: (i) termination is without Cause (as defined
        below), for a period of six months from the termination of Employment,
        (ii) termination is the result of death or disability of the Optionee,
        in which event any Options still in force and unexpired may be exercised
        within a period of one year from the date of termination, but only with
        respect to the number of Options already vested at the time of such
        termination according to the vesting periods of the Options. The term
        "Cause" shall mean any action, omission or state of affairs related to
        the Optionee which the Board decides, in its sole discretion, is against
        the interests of the Company.

   8.7  The holders of Options shall not have any of the rights or privileges of
        shareholders of the Company in respect of any Shares purchasable upon
        the exercise of any part of an Option unless and until, following
        exercise , registration of the Optionee as holder of such Shares in the
        Company's register of members.

   8.8  Any form of Option agreement authorized by the Option Plan may contain
        such other provisions as the Committee may, from time to time, deem
        advisable.

9   VESTING OF OPTIONS

     Notwithstanding anything to the contrary, any Option may be exercised only
     to the extent that such Option was vested. Each option granted hereunder
     shall be vested, in whole or in part, as determined by the Committee in its
     sole and absolute discretion, provided that the Optionee is an employee,
     director or key officer of the Company or any of its subsidiaries, at all
     times during the period beginning with the granting of the Option and
     ending upon the date of vesting of any portion of the Option.

10  DIVIDENDS

     With respect to all Shares (in contrary to unexercised Options) issued upon
     the exercise of Options purchased by the Optionee , the Optionee shall be
     entitled to receive dividends in accordance with the quantity of such
     Shares, and subject to any applicable taxation on distribution of
     dividends.

11  ASSIGNABILITY AND SALE OF OPTIONS

     No Option, purchasable hereunder, whether fully paid or not, shall be
     assignable, transferable or given as collateral or any right with respect
     to them given to any third party whatsoever, and during the lifetime of the
     Optionee each and all of such Optionee's rights to purchase Shares
     hereunder shall be exercisable only by the Optionee.

12  TERM OF THE OPTION PLAN

     The Option Plan shall be effective as of the day it was adopted by the
     Board and shall terminate at the end of 36 (thirty six) months from such
                                             ---------------
     day of adoption.

                                                                               4
<PAGE>

13   AMENDMENTS OR TERMINATION

     The Board may, at any time and from time to time, amend, alter or
     discontinue the Option Plan, except that no amendment or alteration shall
     be made which would impair the rights of the holder of any Option therefore
     granted, without his consent.

14  GOVERNMENT REGULATIONS

     The Option Plan, and the granting and exercise of Options hereunder, and
     the obligation of the Company to sell and deliver Shares under such
     Options, shall be subject to all applicable laws, rules, and regulations,
     whether of the State of Israel or of the United States or any other State
     having jurisdiction over the Company and the Optionee, including the
     registration of the Shares under the United States Securities Act of 1933,
     and to such approvals by any governmental agencies or national securities
     exchanges as may be required.

15  CONTINUANCE OF EMPLOYMENT

     Neither the Option Plan nor the Option agreement with the Optionee shall
     impose any obligation on the Company or a subsidiary thereof, to continue
     any Optionee in its employ or service, and nothing in the Option Plan or in
     any Option granted pursuant thereto shall confer upon any Optionee any
     right to continue in the employ or service of the Company or a subsidiary
     thereof or restrict the right of the Company or a subsidiary thereof to
     terminate such employment at any time.

16  GOVERNING LAW AND JURISDICTION

     This Option Plan shall be governed by and construed and enforced in
     accordance with the laws of the State of Israel applicable to contracts
     made and to be performed therein, without giving effect to the principles
     of conflict of laws. The competent courts of Tel-Aviv, Israel shall have
     sole jurisdiction in any matters pertaining to this Option Plan.

17  ARBITRATION

     Any dispute in relation with this Option Plan and the exercise of rights
     thereunder, shall be brought to arbitration of the legal counsel to the
     Company (the "Arbitrator"), who shall decide on such dispute in accordance
     with the provisions of the Arbitration Law - 1968 and its supplement. The
     decision of the Arbitrator shall be final and shall bind the Company and
     the Optionee.

18  TAX CONSEQUENCES

     Any tax consequences arising from the grant or exercise of any Option, from
     the payment for Shares covered thereby or from any other event or act (of
     the Company or the Optionee), hereunder, shall be borne solely by the
     Optionee. The Company shall withhold taxes according to the requirements
     under the applicable laws, rules, and regulations, including withholding
     taxes at source. Furthermore, the Optionee shall agree to indemnify the
     Company and hold them harmless against and from any and all liability for
     any such tax or interest or penalty thereon, including without limitation,
     liabilities relating to the necessity to withhold, or to have withheld, any
     such tax from any payment made to the Optionee.

     The Committee shall not be required to release any Share certificate to an
     Optionee until all required payments have been fully made.

19  NON-EXCLUSIVITY OF THE OPTION  PLAN

     The adoption of the Option Plan by the Board shall not be construed as
     amending, modifying or rescinding any previously approved incentive
     arrangements or as creating any limitations on the power of the Board to
     adopt such other incentive arrangements as it may deem desirable,
     including, without limitation, the granting of stock Options otherwise than
     under the Option Plan, and such arrangements may be either applicable
     generally or only in specific cases. For the avoidance of doubt, prior
     grants of options to employees of the Company under their employment
     agreements, and not in the framework of

                                                                               5
<PAGE>

     any previous option plan, shall not be deemed an approved incentive
     arrangement for the purpose of this Section.

20  MULTIPLE AGREEMENTS

     The terms of each Option may differ from other Options granted under the
     Option Plan at the same time, or at any other time. The Committee may also
     grant more than one Option to a given Optionee during the term of the
     Option Plan, either in addition to, or in substitution for, one or more
     Options previously granted to that Optionee.

                                                                               6
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5
<SEQUENCE>4
<FILENAME>0004.txt
<DESCRIPTION>OPINION OF GOLDFARB, LEVY, ERAN & CO.
<TEXT>

<PAGE>


                                                                       EXHIBIT 5

                          GOLDFARB, LEVY, ERAN & CO.
                                  Law Offices



                               January 30, 2001


Mind C.T.I Ltd.
Industrial Park, Building 7
P.O. Box 144, Yoqneam
Israel 20692

Dear Sir or Madam:


      We refer to the Registration Statement on Form S-8 (the "Registration
Statement") to be filed with the U.S. Securities and Exchange Commission under
the Securities Act of 1933, as amended (the "Act"), on behalf of Mind C.T.I Ltd.
(the "Company"), relating to an additional 2,306,000 of the Company's ordinary
shares, nominal value NIS 0.01 per share (the "Shares"), issued or to be issued
under the Mind 1998 Share Option Plan or the Mind 2000 Share Option Plan, as
amended (the "Plans").

      As counsel for the Company, we have examined such corporate records, other
documents, and such questions of law as we have considered necessary or
appropriate for the purposes of this opinion and, upon the basis of such
examination, advise you that in our opinion, all necessary corporate proceedings
by the Company have been duly taken to authorize the issuance of the Shares
pursuant to the Plans and that the Shares, when issued upon the exercise of
options granted under the Plans in accordance with the terms of the Plans, will
be duly authorized, validly issued, fully paid and non-assessable.

      We are members of the Israel Bar and we express no opinion as to any
matter relating to the laws of any jurisdiction other than the laws of Israel.


      We hereby consent to the use of this opinion as a part of the Registration
Statement.  This consent is not to be construed as an admission that we are a
person whose consent is required to be filed with the Registration Statement
under the provisions of the Act.


                                      Very truly yours,



                                /s/ Goldfarb, Levy, Eran & Co.




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>5
<FILENAME>0005.txt
<DESCRIPTION>CONSENT OF KESSELMAN & KESSELMAN
<TEXT>

<PAGE>

                                                                    Exhibit 23.1





                    CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
                    -----------------------------------------

     We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 pertaining to the MIND C.T.I. Ltd. 1998 Stock Option Plan
and MIND C.T.I. Ltd. 2000 Stock Option Plan of our report dated March 30, 2000,
except for Notes 5 and 6a(2), for which the date is May 1, 2000, which appears
in MIND C.T.I. Ltd.'s registration statement on Form F-1 (No. 333-12266).








                                                     /s/ Kesselman & Kesselman
Tel Aviv, Israel                                         Kesselman & Kesselman
    January 28, 2001                       Certified Public Accountants (Isr.)
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
