F5 NETWORKS INC (Form: S-8, Received: 02/29/2012 15:03:10)

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company

As filed with the Securities and Exchange Commission on February 29, 2012

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-8

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

F5 NETWORKS, INC.

(Exact name of registrant as specified in its charter)

Washington

(State or other jurisdiction of incorporation or organization)

91-1714307

(I.R.S. Employer Identification No.)

401 Elliott Avenue West, Seattle, Washington 98119

(Address of Principal Executive Offices)

F5 Networks, Inc. Assumed Traffix Communication Systems Ltd. 2007 Israeli Employee Share Option Plan

F5 Networks, Inc. Traffix Acquisition Equity Incentive Plan

(Full Title of the Plan)

Jeffrey A. Christianson

F5 Networks, Inc.

401 Elliott Avenue West

Seattle, WA 98119

(Name and Address of Agent for Service)

(206) 272-5555

(Telephone Number, Including Area Code, of Agent for Service)

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

CALCULATION OF REGISTRATION FEE



Title of each class of securities to be registered	Amount to be registered (1)	Proposed maximum offering price per share (2)	Proposed maximum aggregate offering price	Amount of registration fee
Common Stock, no par value	181,829 shares	$128.62	$23,386,845.98	$2,680.14

(1)

Pursuant to Rule 416(a), this Registration Statement shall also cover any additional shares of common stock of the registrant that become issuable under the F5 Networks, Inc. Assumed Traffix Communication Systems Ltd. 2007 Israeli Employee Share Option Plan (the “ Traffix 2007 Plan ”) or the F5 Networks, Inc. Traffix Acquisition Equity Incentive Plan (the “ Traffix Acquisition Plan ”) by reason of any stock dividend, stock split, recapitalization or other similar transaction effected without receipt of consideration that increases the number of outstanding common shares of the registrant. The amount to be registered includes 106,829 shares that may be issued pursuant to the Traffix 2007 Plan and 75,000 shares that may be issued pursuant to the Traffix Acquisition Plan.

(2)	Computed in accordance with Rule 457(h) and Rule 457(c), solely for the purpose of calculating the registration fee, based on the average of the high and low prices of the common stock of the registrant as reported by The Nasdaq Stock Market on February 24, 2012.

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference.

The following documents filed by F5 Networks, Inc. (the “ Company ”) with the Securities and Exchange Commission are incorporated by reference into this Registration Statement:

(a) Annual Report on Form 10-K for the year ended September 30, 2011;

(b) Quarterly Report on Form 10-Q for the quarter ended December 31, 2011;

(d) the description of the Company’s common stock contained in the Company’s Registration Statement Form 8-A, filed May 11, 1999 under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) including any amendments or reports filed for the purposes of updating such description.

All documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference herein and to be part hereof from the date of filing of such documents.

Item 4. Description of Securities.

Not Applicable

Item 5. Interests of Named Experts and Counsel.

Not Applicable

Item 6. Indemnification of Directors and Officers.

Sections 23B.08.500 through 23.B.08.600 of the Washington Business Corporation Act (the “ WBCA ”) authorize a court to award, or a corporation’s board of directors to grant, indemnification to directors and officers on terms sufficiently broad to permit indemnification under certain circumstances for liabilities arising under the Securities Act of 1933, as amended (the “ Securities Act ”). Section 23B.08.320 of the WBCA authorizes a corporation to limit a director’s liability to the corporation or its shareholders for monetary damages for acts or omissions as a director, except in certain circumstances involving intentional misconduct, knowing violations of law or illegal corporate loans or distributions, or any transaction from which the director personally receives a benefit in money, property or services to which the director is not legally entitled.

The Company’s Second Amended and Restated Articles of Incorporation and Third Amended and Restated Bylaws contain provisions permitting the Company to indemnify its directors and officers to the full extent permitted by Washington law. In addition, the Company’s Second Amended and Restated Articles of Incorporation contain a provision implementing, to the fullest extent permitted by Washington law, the above limitations on a director’s liability to the Company and its shareholders. The Company has entered into certain indemnification agreements with its directors and certain of its officers, the form of which is attached as Exhibit 10.1 to its Registration Statement on Form S-1 (File No. 333-75817). The indemnification agreements provide the Company’s directors and certain of its officers with indemnification to the maximum extent permitted by the WBCA. The directors and officers of the Company also may be indemnified against liability they may incur for serving in that capacity pursuant to a liability insurance policy maintained by the Company for this purpose.

Item 7. Exemption from Registration Claimed.

Not Applicable

Item 8. Exhibits.


Exhibit Number		Exhibit

4.1		Second Amended and Restated Articles of Incorporation (Incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form S-1, File No. 333-75817).

4.2		Third Amended and Restated Bylaws (Incorporated by reference to Quarterly Report on Form 10-Q for the quarter ended December 31, 2008).

4.3		Specimen Stock Certificate (Incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-1, File No. 333-75817).

5.1		Opinion of K&L Gates LLP.

10.1		F5 Networks, Inc. Assumed Traffix Communication Systems Ltd. 2007 Israeli Employee Share Option Plan.

10.2		F5 Networks, Inc. Traffix Acquisition Equity Incentive Plan.

23.1		Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm.

23.2		Consent of K&L Gates LLP (Included in its opinion filed as Exhibit 5.1).

24.1		Power of Attorney (Included on the signature page of this Registration Statement).

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) 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 set forth 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 a 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 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 Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this 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 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 that 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 defense of any action, suit or proceeding) is asserted by such director, officer or controlling person 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 of 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.

Signatures

The Registrant . 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 Seattle, State of Washington, on February 29, 2012.


F5 NETWORKS, INC.

By:		/s/ John McAdam
		John McAdam, Chief Executive Officer and President

Power of Attorney

Each person whose signature appears below constitutes and appoints John McAdam or Jeffrey Christianson, or either of them, his true and lawful attorney-in-fact, with the power of substitution and resubstitution, for him in his name, place or stead, in any and all capacities, to sign any or all amendments to this Registration Statement, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorneys-in-fact and their agents or substitutes, may lawfully do or lawfully cause to be done by virtue hereof.

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.


Signature	Title	Date

/s/ John McAdam John McAdam	Chief Executive Officer, President, and Director (principal executive officer)	February 29, 2012

/s/ John Rodriquez John Rodriquez	Executive Vice President, Chief Accounting Officer (principal financial officer)	February 29, 2012

/s/ A. Gary Ames A. Gary Ames	Director	February 24, 2012

Deborah L. Bevier	Director

/s/ Jonathan Chadwick Jonathan Chadwick	Director	February 28, 2012

/s/ Karl D. Guelich Karl D. Guelich	Director	February 24, 2012

/s/ Alan J. Higginson Alan J. Higginson	Director	February 24, 2012

/s/ Scott Thompson Scott Thompson	Director	February 24, 2012

EXHIBIT INDEX


Exhibit Number		Exhibit

4.1		Second Amended and Restated Articles of Incorporation (Incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form S-1, File No. 333-75817).

4.2		Third Amended and Restated Bylaws (Incorporated by reference to Quarterly Report on Form 10-Q for the quarter ended December 31, 2008).

4.3		Specimen Stock Certificate (Incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-1, File No. 333-75817).

5.1		Opinion of K&L Gates LLP.

10.1		F5 Networks, Inc. Assumed Traffix Communication Systems Ltd. 2007 Israeli Employee Share Option Plan.

10.2		F5 Networks, Inc. Traffix Acquisition Equity Incentive Plan.

23.1		Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm.

23.2		Consent of K&L Gates LLP (Included in its opinion filed as Exhibit 5.1).

24.1		Power of Attorney (Included on the signature page of this Registration Statement).

Exhibit 5.1

[K&L Gates LLP Letterhead]

February 29, 2012

F5 Networks, Inc.

401 Elliott Avenue West

Seattle, Washington 98119

Ladies and Gentlemen:

We have acted as your counsel in connection with the Registration Statement on Form S-8 (the “Registration Statement”) filed with the Securities and Exchange Commission under the Securities Act of 1933 (the “1933 Act”) for the registration of 181,829 shares (the “Shares”) of Common Stock, no par value per share, of F5 Networks, Inc., a Washington corporation. The Shares are issuable under the F5 Networks, Inc. Assumed Traffix Communication Systems Ltd. 2007 Israeli Employee Share Option Plan and the F5 Networks, Inc. Traffix Acquisition Equity Incentive Plan (collectively, the “Plans”).

You have requested our opinion as to the matters set forth below in connection with the Registration Statement. For purposes of rendering that opinion, we have examined the Registration Statement, the Company’s Second Amended and Restated Articles of Incorporation, the Company’s Third Amended and Restated Bylaws, the Plans and the corporate action of the Company adopting the Plans. We have examined and relied upon certificates of public officials and, as to certain matters of fact that are material to our opinion, we have also relied on a certificate of an officer of the Company. In rendering our opinion, we also have made the assumptions that are customary in opinion letters of this kind. We have not verified any of those assumptions.

Our opinion set forth below is limited to the law of the State of Washington.

Based upon and subject to the foregoing, it is our opinion that the Shares, when issued pursuant to and in accordance with the Plans, will be validly issued, fully paid, and nonassessable.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. In giving our consent we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the 1933 Act or the rules and regulations thereunder.

Yours truly,

/s/ K&L Gates LLP

Exhibit 10.1

F5 N ETWORKS , I NC .

A SSUMED T RAFFIX C OMMUNICATION S YSTEMS L TD .

2007 ISRAELI EMPLOYEE SHARE OPTION PLAN

PREFACE

On February 21, 2012, F5 Networks, Inc. (the “ Company ”) acquired all of the outstanding capital stock of Traffix Communication Systems Ltd. (“ Traffix ”) (the “ Acquisition ”). In connection with the Acquisition, the Company assumed the Traffix 2007 Israeli Employee Share Option Plan, which the Company has amended as set forth herein. This plan, as amended from time to time, shall be known as the “Assumed Traffix 2007 Israeli Employee Share Option Plan” (the “ ESOP ”).

1.	PURPOSE OF THE ESOP

The purpose of this ESOP is to foster and promote the long-term financial success of the Company and its Affiliates and increase shareholder value by:

(a) motivating superior performance by means of performance-related incentives;

(b) encouraging and providing for the acquisition of an ownership interest in the Company by eligible Employees; and

(c) enabling the Company to attract and retain the services of outstanding management team and other qualified and dedicated employees upon whose judgment, interest and special effort the successful conduct of its operations is largely dependent.

2.	DEFINITIONS

For purposes of this ESOP and related documents, including the Grant Letter, the following definitions shall apply:

2.1

“ Administrator ”—means the Board or the Committee as shall be administering this ESOP, in accordance with Section 3 hereof.

2.2

“ Affiliate ”—means any “employing company” within the meaning of Section 102(a) of the Ordinance.

2.3

“ Approved 102 Option ”—means an Option granted pursuant to Section 102(b) of the Ordinance and held in trust by a Trustee for the benefit of the Optionee.

2.4

“ Articles of Incorporation ”—means the Articles of Incorporation of the Company as same are in effect from time to time.

2.5

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

2.6

“ Capital Gain Option” or “CGO ”—as defined in Section 5.4 below.

2.7

“ Cause ”—means, with respect to an Employee (i) as such term is defined in the individual employment agreement or other engagement agreement between the Employee and Traffix or its Affiliates, or (ii) if no such agreement is in place, then ‘Cause’ shall mean any one of the following: (a) conviction of any felony

involving moral turpitude or affecting Traffix or its Affiliates; (b) any failure to carry out, as an employee of the Traffix or its Affiliates, a reasonable directive of the chief executive officer, the Board or the Optionee’s direct supervisor, which involves the business of Traffix or its Affiliates and which was capable of being lawfully performed by Optionee; (c) embezzlement or theft of funds of Traffix or its Affiliates; (d) any breach of the Optionee’s fiduciary duties or duties of care of Traffix; including, without limitation, self-dealing, prohibited disclosure of confidential information of, or relating to, Traffix or its Affiliates, or engagement in any business competitive to the business of Traffix or of its Affiliates; (e) any conduct (other than conduct in good faith) reasonably determined by the Board to be materially detrimental to Traffix or its Affiliates, and (f) any other circumstances under which Traffix or its Affiliates is entitled to terminate Optionee’s employment with Traffix or such Affiliate without paying Optionee severance pay under applicable law; and with respect to a Non-Employee (i) as such term is defined in the individual engagement agreement between the Optionee and Traffix or its Affiliates, or (ii) if no such agreement is in place, then ‘Cause’ shall mean any one of the circumstances set forth in (a) through and including (e) herein, as applicable to such Non-Employee.

2.8

“ Chairman ”—means the chairman of the Committee.

2.9

“ Committee ”—means a share option compensation committee appointed by the Board, which shall consist of no fewer than two members of the Board, and if no such compensation committee is appointed, then the Board.

2.10

“ Common Stock ” – means common stock of the Company, no par value per share.

2.11

“ Company ”—means F5 Networks, Inc., a Washington corporation.

2.12

“ Companies Law ”—means the Israeli Companies Law, 5759-1999, including any rules and regulations promulgated thereunder and any provisions of the Companies Ordinance [New Version], 1983 still in effect, as amended from time to time.

2.13

“ Controlling Shareholder ”—shall have the meaning ascribed to it in Section 32(9) of the Ordinance.

2.14

“ Date of Grant ”—means, the date of grant of an Option, as determined by the Board and set forth in the Optionee’s Grant Letter, and in any event not earlier than the first date on which the Company is permitted to effect Option grants under this ESOP and the provisions of the Ordinance.

2.15

“ Employee ”—means a person who is employed by Traffix or its Affiliates, including an individual who is serving as a director or an office holder, but excluding Controlling Shareholder.

2.16

“ Expiration Date ”—means the date upon which an Option shall expire, as set forth in Section 9.2 of this ESOP.

2.17

“ Fair Market Value ”—means as of any date, the value of a Share determined as follows:

2.17.1

If the Shares are listed on any established stock exchange or a national market system, including without limitation the NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ Capital Market, the Fair Market Value shall be the closing sales price for such Shares (or the closing bid, if no sales were reported), as quoted on such exchange or system for the last market trading day prior to time of determination, as reported in the Wall Street Journal, or such other source as the Board deems.

2.17.2

Without derogating from the above, solely for the purpose of determining the tax liability pursuant to Section 102(b)(3) of the Ordinance, if at the Date of Grant the Company’s shares are listed on any established stock exchange or a national market system or if the Company’s shares will be registered for trading within ninety (90) days following the Date of Grant, the Fair Market Value of a Share at the Date of Grant shall be determined in accordance with the average value of the Company’s shares on the thirty (30) trading days preceding the Date of Grant or on the thirty (30) trading days following the date of registration for trading, as the case may be;

2.17.3

If the Shares are regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value shall be the mean between the high bid and low asked prices for the Shares on the last market trading day prior to the day of determination, or;

2.17.4

In the absence of an established market for the Shares, the Fair Market Value thereof shall be determined in good faith by the Board.

2.18

“ Grant Letter ” means the grant letter given by the Company to the Optionee and signed by the Optionee, and which sets out the terms and conditions of an Option.

2.19

“ ESOP ”—means as defined in the preface hereto.

2.20

“ ITA ”—means the Israeli Tax Authorities.

2.21

“ NIS ” —means, New Israeli Shekels.

2.22

“ Non-Employee ”—means a consultant, adviser, service provider, Controlling Shareholder or any other person who is not an Employee.

2.23

“ Ordinary Income Option ” or “ OIO ”—as defined in Section 5.5 below.

2.24

“ Option ”—means an option to purchase one or more Shares of the Company pursuant to this ESOP.

2.25

“ 102 Option ”—means an Option that the Board intends to be a “102 Option” which shall only be granted to Employees who are not Ten Percent shareholders, and shall be subject to and construed consistently with the requirements of Section 102 of the Tax Ordinance. The Company shall have no liability to an Optionee, or to any other party, if an Option (or any part thereof), which is intended to be a 102 Option, does not eventually qualify as a 102 Option. Approved 102 Options may either be classified as Capital Gain Options (CGO) or Ordinary Income Options (OIO).

2.26

“ 3(i) Option ”—means Options that do not contain such terms as will qualify under Section 102 of the Tax Ordinance.

2.27

“ Optionee ”—means a person who receives or holds an Option under this ESOP.

2.28

“ Ordinance ”—means the Israeli Income Tax Ordinance [New Version] 1961, including any and all rules and regulations promulgated thereunder, as now in effect or as hereafter amended.

2.29

“ Purchase Price ”—means the purchase price for each Share underlying an Option.

2.30

“ Section 102 ”—means Section 102 of the Ordinance, including any and all rules, regulations, orders and procedures promulgated thereunder, as now in effect or as hereafter amended.

2.31

“ Share ”—means a share of Common Stock of the Company.

2.32

“ Successor Company ”—means any entity into or with which the Company is merged or by which, the Company is acquired, pursuant to a Transaction in which the Company is not the surviving entity.

2.33

“ Traffix ” —means Traffix Communication Systems Ltd., a company incorporated under the laws of the State of Israel, corporate registration number 513768762.

2.34

“ Transaction ” —means, each (i) merger, acquisition or reorganization of the Company with one or more other entities in which the Company is not the surviving entity, or (ii) a sale of all or substantially all of the assets or shares of the Company.

2.35

“ Trustee ”—means any individual appointed by the Company to serve as a trustee and approved by the ITA, all in accordance with the provisions of Section 102(a) of the Ordinance.

2.36

“ US$ ” —means, United States of America dollars.

2.37

“ Vested Option ” —means any Option that has already become vested and exercisable according to its Vesting Dates or otherwise (e.g. acceleration upon certain events).

2.38

“ Vesting Dates ”—means, with respect to any Option, the date(s) as of which the Optionee shall be entitled to exercise such Option, as set forth Optionee’s individual Grant Letter, and if no such date(s) are specified in Optionee’s individual Grant Letter, then as set out in Section 10.2 of this ESOP.

2.39

“ Unapproved 102 Option ”—means an Option granted pursuant to Section 102(c) of the Ordinance and not held in trust by a Trustee.

3.	ADMINISTRATION OF THIS ESOP

This ESOP shall be administered by the Board. The Board shall have the authority in its sole discretion, subject and not inconsistent with the express provisions of this ESOP, to administer this ESOP and to exercise all the powers and authorities specifically granted to it under this ESOP as necessary and advisable in the administration of this ESOP.

Provided that the Board is entitled by law to delegate all and any of its powers and authority granted to it under this ESOP to a Committee, then such powers and authority may be delegated to the Committee. The Committee shall have the responsibility of construing and interpreting this ESOP and of establishing and amending such rules and regulations, as it deems necessary or desirable for the proper administration of this ESOP.

3.1

The Committee shall select one of its members as its Chairman and shall hold its meetings at such times and places, as the Chairman shall determine or as otherwise convened in accordance with the Articles of Incorporation. The Committee shall keep records of its meetings and shall make such rules and regulations for the conduct of its business, as it shall deem advisable.

3.2

The Committee shall have the power to recommend to the Board and the Board shall have the full power and authority to: (i) designate Optionees; (ii) determine the, Date of Grant, terms and provisions of the respective Grant Letters (which need not be identical), including, but not limited to, the number of Options to be granted to each Optionee, the number of Shares to be covered by each Option, provisions concerning the time and extent to which the Options may be exercised, and the nature and duration of restrictions as to the transferability, or restrictions constituting substantial risk of forfeiture upon occurrence of certain events; (iii) determine the Fair Market Value of the Shares covered by each Option; (iv) designate the type of Options; and (v) cancel or suspend Options, as necessary.

3.3

Subject to the provisions of this ESOP, the applicable laws and, the specific duties delegated by the Board to the Committee, and subject to the approval of any relevant authorities, the Committee shall have the authority, in its discretion:

(i)

To construe and interpret the terms of this ESOP and any Options granted pursuant hereto;

(ii)

To designate the Employees and Non-Employees to whom Options may from time to time be granted hereunder;

(iii)

To determine the number of Shares to be covered by each such Option granted hereunder;

(iv)

To prescribe forms of agreements and/or Grant Letters for use under this ESOP;

(v)

To determine the terms of any Option granted hereunder;

(vi)

To determine the Purchase Price of any Option granted hereunder;

(vii)

To determine the Fair Market Value of Shares;

(viii)

To prescribe, amend and rescind rules and regulations relating to this ESOP, provided that any such amendment or rescindment that would adversely affect the rights of an Optionee that has received or been granted an Option shall not be made without the Optionee’s written consent.

(ix)

To take all other action and make all other determinations necessary for the administration of this ESOP.

(x)

To determine the total number of Shares with in the pool allocated for the purpose of this ESOP from time to time, and or any additional awards hereafter, subject to this ESOP.

3.4

Subject to the Articles of Incorporation, all decisions and selections made by the Board or the Committee pursuant to the provisions of this ESOP shall be made by a majority of its members except that no member of the Board or the Committee shall vote on, or be counted for quorum purposes, with respect to any proposed action of the Board or the Committee relating to any Option to be granted to that member. Any decision reduced to writing shall be executed in accordance with the provisions of the Articles of Incorporation, as the same may be in effect from time to time.

3.5

Any decision or action taken or to be taken by the Committee, arising out of or in connection with the construction, administration, interpretation and effect of this ESOP and of its rules and regulations, shall, to the maximum extent permitted by applicable law, be within its absolute discretion (except as otherwise specifically provided herein) and shall be conclusive and binding upon all Optionees and any person claiming under or through any Optionee.

3.6

No member of the Board or the Committee shall be liable for any action taken or determination made in good faith with respect to this ESOP or any Option granted hereunder.

3.7

Any member of such Committee shall be eligible to receive Options under this ESOP while serving on the Committee, unless otherwise specified herein. No person shall be eligible to be a member of the Committee if that person’s membership would prevent this ESOP from complying with exemptions provided under applicable laws.

4.	DESIGNATION OF OPTIONEES

4.1

The persons eligible for participation in this ESOP as Optionees shall include any Employees and/or Non-Employees of Traffix or of its Affiliates on or prior to February 21, 2012; provided, however, that (i) Employees may only be granted 102 Options; and (ii) Non-Employees may only be granted 3(i) Options.

4.2

Each Option granted pursuant to this ESOP shall be evidenced by a Grant Letter, in such form as is customarily used by the Company for such purpose. Each Grant Letter shall state, among other matters, the number of Shares to which the Option relates, the type of Option granted thereunder (whether an CGO, OIO, Unapproved 102 Option or a 3(i) Option), the Vesting Dates, the Purchase Price per share, the Expiration Date and such other terms and conditions as are customarily included in such letters or option agreements, including any such other terms that the Committee or the Board in their discretion may prescribe, provided in all cases that they are consistent with this ESOP. The Grant Letter shall be delivered to the Optionee and executed by the Optionee and shall incorporate the terms of this ESOP by reference and specify the terms and conditions thereof and any rules applicable thereto.

4.3

Neither this ESOP nor any Grant Letter nor any offer of Options to an Optionee shall impose any obligation on Traffix or its Affiliates to continue to employ or to engage the services of any Optionee, and nothing in this ESOP or in any Option granted pursuant thereto shall give any Optionee any right to continued employment, service with or engagement by Traffix or its Affiliates or restrict the right of Traffix or its Affiliates to terminate such employment, services or engagement at any time. Further, the Company and each Affiliate expressly reserves the right at any time to dismiss an Optionee free from any liability, or any claim under this ESOP, except as provided herein or in any agreement entered into with respect to an Option.

4.4

The grant of an Option hereunder shall neither entitle the Optionee to participate nor disqualify the Optionee from participating in, any other grant of Options pursuant to this ESOP or any other option or share plan of the Company or any of its Affiliates.

4.5

Notwithstanding anything in the ESOP to the contrary, all grants of Options to directors and office holders shall be authorized and implemented in accordance with the provisions of the Companies Law.

5.	DESIGNATION OF OPTIONS PURSUANT TO SECTION 102

5.1

The Company may designate Options granted to Employees pursuant to Section 102 as Unapproved 102 Options or Approved 102 Options.

5.2

The grant of Approved 102 Options under this ESOP shall be made in accordance with the provisions herein, including the provisions of Section 6 below, and shall be conditioned upon the approval of this ESOP by the ITA.

5.3

Approved 102 Option may either be classified as Capital Gain Option (CGO) or Ordinary Income Option (OIO).

5.4

Approved 102 Option elected and designated by the Company to qualify under the capital gain tax treatment in accordance with the provisions of Section 102(b)(2) shall be referred to herein as CGO.

5.5

Approved 102 Option elected and designated by the Company to qualify under the ordinary income tax treatment in accordance with the provisions of Section 102(b)(1) shall be referred to herein as OIO.

5.6

The Company’s election of the type of Approved 102 Options as CGO or OIO granted to Employees (the “Election”) shall be appropriately filed with the ITA before the first Date of Grant of an Approved 102 Option under such Election. Such Election shall become effective beginning the first Date of Grant of an Approved 102 Option under such Election and shall remain in effect until the end of the year following the year during which the Company first granted Approved 102 Options under such Election. The Election shall obligate the Company to grant only the type of Approved 102 Option it has elected, and shall apply to all Optionees who were granted Approved 102 Options during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Ordinance. For avoidance of doubt, such Election shall not prevent the Company from granting Unapproved 102 Options simultaneously.

5.7

Designation of Approved 102 Options – if an Optionee exercises and sells his Shares within the Restricted Period (as defined in Section 6.1 below), the Company shall not bare any tax liability arising due to the exercise and or sale of such Shares resulting from Optionee’s termination of employment, except for the tax liability mentioned in Section 21 below.

5.8

All Approved 102 Options must be held in trust by the Trustee, as described in Section 6 below.

5.9

For avoidance of doubt, the designation of Unapproved 102 Options and Approved 102 Options shall be subject to the terms and conditions set forth in Section 102 of the Ordinance.

6.	TRUSTEE

6.1

Approved 102 Options which shall be granted under this ESOP and/or any Shares allocated or issued upon exercise of such Approved 102 Options and/or other shares received subsequently following any realization of rights, including, without limitation, bonus shares, shall be allocated or issued to or controlled by the Trustee and held or controlled by the Trustee for the benefit of the Optionees to whom such Approved 102 Options were granted for at least such period of time as required by Section 102 (the “Restricted Period”). If the requirements for Approved 102 Options are not met, the Approved 102 Options may be treated as Unapproved 102 Options, all in accordance with the provisions of Section 102.

6.2

Notwithstanding anything to the contrary herein, the Trustee shall not allow the release of any Shares allocated or issued upon exercise of Approved 102 Options prior to the full payment of the Optionee’s tax liabilities arising from Approved 102 Options, which were granted to such Optionee and/or any Shares allocated or issued upon exercise of such Options.

6.3

With respect to any Approved 102 Option, subject to the provisions of Section 102, an Optionee shall not sell or release from trust any Share received upon the exercise of an Approved 102 Option and/or any share received subsequently following any realization of rights, including without limitation, bonus shares, until the lapse of the Restricted Period required under Section 102. Notwithstanding the above, if any such sale or release occurs during the Restricted Period, the sanctions under Section 102 shall apply to and shall be borne by such Optionee.

6.4

Upon receipt of Approved 102 Option, the Optionee will sign an undertaking to release the Trustee from any liability in respect of any action or decision duly taken and bona fide executed in relation with this ESOP, or any Approved 102 Option or Share granted to him hereunder. Such release may be incorporated into the Grant Letter.

7.	SHARES RESERVED FOR THE ESOP

7.1

Subject to the adjustments set forth in Section 11 below, the number of Shares that may be issued pursuant to this ESOP shall not exceed in the aggregate 106,829 Shares. Should any Option for any reason expire or be canceled prior to its exercise or relinquishment in full, the Shares subject to such Option may again be subjected to a new Option under this ESOP, provided, however, that Shares that have actually been issued under this ESOP shall not be returned to the pool under this ESOP and shall not become available for future distribution under this ESOP.

8.	PURCHASE PRICE

8.1

The Purchase Price of each Share subject to an Option shall be equal to the Share’s Fair Market Value or as otherwise determined by the Committee in its sole and absolute discretion in accordance with applicable law, subject to any guidelines as may be determined by the Board from time to time. Each Grant Letter will contain the Purchase Price determined for each Option covered thereby (but in any event, not less than the nominal value of the Share issuable upon exercise thereof).

8.2

The total consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator and may consist entirely of (1) cash, (2) check, or (3) any combination of the foregoing methods of payment, or (4) if, as of the date of exercise of an Option the Company then is permitting Employees to engage in a “same-day sale” cashless brokered exercise program involving one or more brokers, through such a program that complies with the Applicable Laws (including without limitation the requirements of Regulation T and other applicable regulations promulgated by the Federal Reserve Board) and that ensures prompt delivery to the Company of the amount required to pay the exercise price and any applicable withholding taxes,. In making its determination as to the type of consideration to accept, the Administrator shall consider if acceptance of such consideration may be reasonably expected to benefit the Company. The Committee shall have the authority to postpone the date of payment on such terms as it may determine.

8.3

The Purchase Price shall be denominated in NIS or US$ or otherwise as determined by the Committee.

8.4

The proceeds received by the Company from the issuance of Shares subject to the Options will be added to the general funds of the Company and used for its corporate purposes.

9.	TERM AND EXERCISE OF OPTIONS

9.1

Options shall be exercised by the Optionee by giving written notice to the Company and/or to any third party designated by the Company (the “Representative”), in such form and method as may be determined by the Committee and when applicable, by the Trustee in accordance with the requirements of Section 102, which exercise shall be effective upon receipt of such notice by the Company and/or the Representative and the payment of the Purchase Price at the Company’s or the Representative’s principal office. The notice shall specify the number of Shares with respect to which the Option is being exercised.

9.2

Options, to the extent not previously exercised, shall terminate forthwith upon the earlier of: (i) the date set forth in the Grant Letter as determined by the Board; or (ii) the expiration of any extended period in any of the events set forth in Section 9.5 below.

9.3

The Options may be exercised by the Optionee in whole at any time or in part from time to time, to the extent that the Options become vested and exercisable, prior to the Expiration Date, and provided that, subject to the provisions of Section 9.5 below, the Optionee who is an Employee is employed by or providing services to Traffix or any of its Affiliates, at all times during the period beginning with the granting of the Option and ending upon the date of exercise. An Optionee who is a Non-Employee may exercise the Options in whole at any time or in part from time to time, to the extent that the Options have become vested and exercisable, prior to the Expiration Date.

9.4

Subject to the provisions of Section 9.5 below, in the event of termination of Optionee’s employment or services with Traffix or any of its Affiliates, all Options granted to such Optionee that are at the time of termination non-vested will immediately expire. A notice of termination of employment or service shall be deemed to constitute termination of employment or service. For the avoidance of doubt, in case of such termination of employment or service, the unvested portion of the Optionee’s Option shall not vest and shall not become exercisable and any unvested portion of the Optionee’s Option shall revert to the pool of Shares under this ESOP or that of other share option plans then in effect.

9.5

Notwithstanding anything to the contrary herein and unless otherwise determined in the Optionee’s Grant Letter, an Option may be exercised after the date of termination of Optionee’s employment or service with Traffix or any Affiliates during an additional period of time beyond the date of such termination, but only with respect to the number of Vested Options at the time of such termination according to the Vesting Dates, as follows:

(i)

If termination is without Cause, then any Vested Option still in force and un-expired may be exercised within a period of three (3) months after the date of such termination;

(ii)

If termination is the result of death, or Disability (defined below) of the Optionee, then any Vested Option still in force and un-expired may be exercised within a period of twelve (12) months after the date of such termination;

(iii)

With respect to (i) and (ii) above, prior to the expiration of the periods set out therein (i.e., the 3-month period in (i) above, and the 12-month period in (ii) above), the Committee may authorize an extension of the terms of exercise post-termination of all or part of the Vested Options beyond the date of such termination for a period not to exceed the period during which the Options by their terms would otherwise have been exercisable.

(iv)

For avoidance of any doubt, notwithstanding anything herein to the contrary, if termination of employment or service is for Cause, any outstanding unexercised Option (whether vested or non-vested), will immediately expire and terminate, and the Optionee shall not have any right in connection to such outstanding Options.

(v)

As used herein: the term “ Disability ” shall have the meaning ascribed thereto in the individual employment or engagement agreement between the Optionee and Traffix or any of its Affiliates, as applicable and if no such definition exists, then ‘Disability’ shall mean Optionee’s inability to perform his/her duties to Traffix, or to any of its Affiliates, for a consecutive period of at least 180 days, by reason of any medically determinable physical or mental impairment.

9.6

To avoid doubt, the Optionees shall not be deemed owners of the Shares issuable upon the exercise of Options and shall not have any of the rights or privileges of shareholders of the Company in respect of any Shares purchasable upon the exercise of any Option, nor shall they be deemed to be a class of shareholders of the Company for any purpose, including but not limited for the purpose of the operation of Sections 350 and 351 of the Companies Law or any successor to such section, until registration of the Optionee as holder of such Shares in the Company’s register of shareholders upon exercise of the Option in accordance with the provisions of this ESOP, but in case of Options and Shares held by the Trustee, subject to the provisions of Section 6 of this ESOP. Notwithstanding anything herein to the contrary, in no event shall the Optionees be deemed a class of creditors of the Company for any purpose whatsoever, including but not limited to for the purpose of the operation of Sections 350 and 351 of the Companies Law or any successor to such section.

9.7

Any form of Grant Letter customarily used by the Company in connection with the grant of Options, provided it is consistent with the provisions of this ESOP, may contain such other provisions, as the Committee or the Board may, from time to time, deem advisable.

9.8

The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary for the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

9.9

With respect to Unapproved 102 Options, if the Optionee ceases to be employed by the Company or any Affiliate, the Optionee shall extend to the Company and/or its Affiliate a security or guarantee for the payment of tax due at the time of sale of Shares, all in accordance with the provisions of Section 102. In respect of any employer’s tax liability for the purpose of employment taxes such as in the case of social taxes, see Section 21 below.

9.10

Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option, the method of payment and the issuance and delivery of such Shares shall comply with applicable laws.

9.11

Upon their issuance, the Shares shall carry equal voting rights on all matters where such vote is permitted by applicable laws of the jurisdiction of incorporation of the Company.

10.

VESTING OF OPTIONS

10.1

Subject to the provisions of this ESOP, each Option shall vest and become exercisable commencing on the Vesting Date thereof, as determined by the Board or by the Committee, for the number of Shares as shall be provided in the Grant Letter. However, no Option shall be exercisable after the Expiration Date.

10.2

Unless otherwise stated in the Optionee’s Grant Letter, all Options granted pursuant to this ESOP, shall vest semi-annually, in eight (8) equal portions, over a 4-year period from its Date of Grant, with twelve and one half percent (12.5%) of such Option becoming vested at the end of each six (6) month period following the Date of Grant.

10.3

An Option may be subject to such other terms and conditions on the time or times when it may be exercised, as the Committee may deem appropriate. The vesting provisions of individual Options may vary.

11.

ADJUSTMENTS

11.1

Changes in Capitalization . Subject to any required action by the shareholders of the Company, the number of Shares covered by each outstanding Option, the number of Shares which have been reserved for issuance under this ESOP and/or any other share option plan adopted by the Company, but as to which no Options have yet been granted or which have been returned to this ESOP or such other share option plans upon cancellation or expiration of an Option, as well as the Purchase Price per share of Shares covered by each such outstanding Option, shall be proportionately adjusted for any increase or decrease resulting from a share split, bonus shares (share dividend), combination or reclassification of the Shares, or any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company. The adjustments described herein shall be made by the Administrator, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to the number or the price of Shares subject to an Option. If the Options or the Shares issued upon the exercise of such Options will be deposited with a Trustee, as determined by the Administrator, all of the Shares formed by these adjustments also will be deposited with the Trustee on the same terms and conditions as the original Options or Shares.

11.2

Dissolution or Liquidation . In the event of any dissolution or liquidation of the Company, whether voluntary or involuntary (the “Event”), the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such Event. The Option holders shall then have fifteen (15) days to exercise any unexercised Vested Options held by them at that time, in accordance with the exercise procedure set forth herein. Upon the expiration of such 15-day period, all remaining unexercised Options and any non Vested Options will terminate immediately. The Administrator in its sole discretion may allow the exercise of any or all-outstanding Options, whether or not such Options are Vested Options, during a longer period following such notification and prior to the Event, all subject to the provisions of applicable laws. To the extent it has not been previously exercised, an Option and all Optionee’s rights thereto will terminate immediately prior to the Event.

11.3

Merger, Acquisition, Shares’ sale, Assets’ Sale

(a)

In the event of a Transaction, and to the extent possible by the terms of the Transaction, each outstanding Option shall be assumed for an equivalent option or right substituted by the successor corporation or a parent or subsidiary of the successor corporation, and appropriate adjustments shall be made in the number of options in order to reflect such an action and to keep the Optionee harmless due to the Transaction.

(b)

In the event that as part of the Transaction the successor corporation refuses to assume or substitute outstanding Options, the vesting periods defined in the Grant Letters may be fully accelerated, in whole or in part, if so determined by the Board. In this event, the Administrator shall notify each Optionee in writing or electronically if and to what extent the Board has approved the acceleration of an Option, and as to each Option that has been accelerated, the period of time during which the Vested Option may be exercised by the Optionee. The determination as to acceleration of any then un-Vested Options and the duration during which any Vested Options may be exercised in connection with a Transaction shall be in the sole and absolute discretion of the Board. Subject to the following paragraph of this Section 11.3(b) below, any Vested Options shall be fully exercisable for such period as determined by the Board, where any un-Vested or Vested but un-exercised Options shall terminate upon the expiration of such period.

In any event, any Vested Option not exercised by the date on which the definitive agreement for the Transaction has been executed (the “Cut-Off Date”), and any un-Vested Options on such Cut-Off Date, shall immediately terminate and no longer be exercisable by the Optionee as of the Cut-Off Date.

(c)

Without derogating from the provisions of paragraph (b) above, if as a condition precedent to a Transaction, all Optionees are required to sell or

exchange their Vested Options and/or any Shares issued upon exercise thereof as part of the Transaction, then each Optionee shall be obligated to sell or exchange, as the case may be, any Vested Options and/or Shares such Optionee holds or purchased under this ESOP, in accordance with the instructions of the Board, at its sole and absolute discretion, in connection with the Transaction, and on the same terms as shall be determined to all the holders of Common Stock in the Company. For avoidance of doubt, on the Cut-Off Date of a Transaction, any Vested Options not sold or exchanged and any non-Vested Options shall terminate and expire as of the Cut-Off Date.

(d)

For the purposes of this paragraph, the Option shall be considered assumed if, following a Transaction, the Optionee receives the right to purchase or receive, for each Share subject to the Option immediately prior to the Transaction, the consideration (whether in shares, stocks, cash, or other securities or property) received in the Transaction by holders of Shares for each Share held on the effective date of the Transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Transaction is not solely shares of the successor corporation or its parent or subsidiary, the Administrator may, with the consent of the successor corporation, provide for each Optionee to receive solely Shares of the successor company or its parent or subsidiary equal in Fair Market Value to the per share consideration received by holders of Shares in the Transaction.

11.4

Stock dividend, bonus shares, stock split

(a)

If the outstanding shares of the Company shall at any time be changed or exchanged by declaration of a share dividend (bonus shares), share split, combination or exchange of shares, recapitalization, or any other like event by or of the Company, and as often as the same shall occur, then the number, class and kind of the Shares subject to this ESOP or subject to any Options therefor granted, and the Purchase Prices, shall be appropriately and equitably adjusted so as to maintain the proportionate number of Shares without changing the aggregate Purchase Price, provided, however, that the Purchase Price shall not be less than the nominal value of the Share underlying any such Options, and provided further, that no adjustment shall be made by reason of the distribution of subscription rights (rights offering) on outstanding shares. Upon the occurrence of any of the foregoing, the class and aggregate number of Shares issuable pursuant to this ESOP (as set forth in Section 7 hereof), in respect of which Options have not yet been exercised, shall be appropriately adjusted, all as will be determined by the Board whose determination shall be final.

(b)

Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Option.

12.

PURCHASE FOR INVESTMENT; REPRESENTATIONS

12.1

The Company’s obligation to issue or allocate Shares upon exercise of an Option granted under this ESOP is expressly conditioned upon: (a) the Company’s completion of any registration or other qualifications of such Shares under all applicable laws, rules and regulations or (b) representations and undertakings by the Optionee (or his legal representative, heir or legatee, in the event of the Optionee’s death) to assure that the sale of the Shares complies with any registration exemption requirements which the Company in its sole discretion shall deem necessary or advisable. Such required representations and undertakings may include representations and agreements that such Optionee (or his legal representative, heir, or legatee): (a) is purchasing such Shares for investment and not with any present intention of selling or otherwise disposing thereof; and (b) agrees to have placed upon the face and reverse of any certificates evidencing such Shares a legend setting forth (i) any representations and undertakings which such Optionee has given to the Company or a reference thereto and (ii) that, prior to effecting any sale or other disposition of any such Shares, the Optionee must furnish to the Company an opinion of counsel, satisfactory to the Company, that such sale or disposition will not violate the applicable laws, rules, and regulations, whether of the State of Israel or of any other State having jurisdiction over the Company and the Optionee.

12.2

Upon the grant of Options to an Optionee or the issuance of Shares upon the exercise thereof, the Company shall obtain from the Optionee the representations and undertakings as follows, and any other representations and warranties that the Committee may deem advisable, and the giving of such representations and warranties by the Optionee shall be a condition precedent to Optionee’s right to receive the Option and/or be issued the Shares upon exercise thereof:

(a)

That the Optionee knows that there is no certainty that the exercise of the Options will be financially worthwhile. The Optionee thereby undertakes not to have any claim against the Company or any of its directors, employees, stockholders or advisors if it emerges, at the time of exercising the Options, that the Optionee’s investment in the Company’s Shares was not worthwhile, for any reason whatsoever.

(b)

That the Optionee knows and understands that his rights regarding the Options and the Shares are subject for all intents and purposes to the instructions of the Company’s documents of incorporation and to the agreements of the shareholders in the Company.

(c)

That the Optionee knows that in addition to the allocations set forth above, the Company has allocated and/or is entitled to allocate Options and Shares to other employees and other people, and the Optionee shall have no claim regarding such allocations, their quantity, the relationship among them and between them and the other shareholders in the Company, exercising of the options or any matter related to or stemming from them.

(d)

That the Optionee knows that neither this ESOP nor the grant of Option or Shares thereunder shall impose any obligation on Traffix or its Affiliates to continue the engagement of the Optionee, and nothing in this ESOP or in any Option or Shares granted pursuant thereto shall confer upon any Optionee any right to continue being engaged by Traffix or its Affiliates, or restrict the right of Traffix or its Affiliates to terminate such engagement at any time.

13.

DIVIDENDS

With respect to all Shares (but excluding, for avoidance of any doubt, any unexercised Options) allocated or issued upon the exercise of Options purchased by the Optionee and held by the Optionee or by the Trustee, as the case may be, the Optionee shall be entitled to receive dividends in accordance with the quantity of such Shares, subject to the provisions of the Articles of Incorporation and subject to any applicable taxation on distribution of dividends, and, when applicable, subject to the provisions of Section 102.

14.

RESTRICTIONS ON ASSIGNABILITY AND SALE OF OPTIONS

14.1

No Option or any right with respect thereto, purchasable hereunder, whether fully paid or not, shall be assignable, transferable or given as collateral or any right with respect to it given to any third party whatsoever, except as specifically allowed under this ESOP, and during the lifetime of the Optionee each and all of such Optionee’s rights to purchase Shares hereunder shall be exercisable only by the Optionee.

Any such action made directly or indirectly, for an immediate validation or for a future one, shall be void.

14.2

So long as Options and/or Shares are held by the Trustee on behalf of the Optionee, all rights of the Optionee over the Shares are personal, can not be transferred, assigned, pledged or mortgaged, other than by will or pursuant to the laws of descent and distribution.

15.

EFFECTIVE DATE AND DURATION OF THE ESOP

This ESOP shall be effective as of February 21, 2012 and shall terminate on August 22, 2017, unless terminated earlier in accordance with Section 16 hereof.

16.

AMENDMENTS OR TERMINATION

The Board may at any time, but when applicable, after consultation with the Trustee, amend, alter, suspend or terminate this ESOP. No amendment, alteration, suspension or termination of this ESOP shall impair the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Company, which agreement must be in writing and signed by the Optionee and the Company. Termination of this ESOP shall not affect the Committee’s ability to exercise the powers granted to it hereunder with respect to Options granted under this ESOP prior to the date of such termination.

17.

GOVERNMENT REGULATIONS

This ESOP, and the grant 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 any other State having jurisdiction over the Company and the Optionee, including, without limitation, the United States Securities Act of 1933, the Companies Law, the Securities Law, 1968, and the Ordinance, and to such approvals by any governmental agencies or national securities exchanges as may be required. Nothing herein shall be deemed to require the Company to register the Shares under the securities laws of any jurisdiction.

18.

CONTINUANCE OF EMPLOYMENT OR HIRED SERVICES

Neither this ESOP nor the Grant Letter with the Optionee shall impose any obligation on Traffix or an Affiliate thereof, to continue any Optionee in its employ or service, and nothing in this ESOP or in any Option granted pursuant thereto shall confer upon any Optionee any right to continue in the employ or service of Traffix or an Affiliate thereof or restrict the right of Traffix or an Affiliate thereof to terminate such employment or service at any time.

19.

GOVERNING LAW & JURISDICTION

This ESOP 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 district, Israel shall have sole and exclusive jurisdiction in any matters pertaining to this ESOP and any Grant Letters effected hereunder.

20.

INTEGRATION OF SECTION 102 AND TAX COMMISSIONER’S PERMIT

20.1

With regards to Approved 102 Options, the provisions of this ESOP and the Grant Letter shall be subject to the provisions of Section 102 and the ITA Commissioner’s permit, and the said provisions and permit shall be deemed an integral part of this ESOP and of the individual Grant Letters with each Optionee.

20.2

Any provision of Section 102 and/or the said permit which is necessary in order to receive and/or to keep any tax benefit pursuant to Section 102, which is not expressly specified in this ESOP or the individual Grant Letter of the Optionees, shall be considered binding upon the Company and the Optionees.

21.

TAX CONSEQUENCES

21.1

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

21.2

The Company and/or, when applicable, the Trustee shall not be required to release any Share and/or share certificate representing such Shares to an Optionee until all required payments have been fully made.

21.3

To the extent provided by the terms of any Grant Letter, the Optionee may satisfy any tax withholding obligation relating to the exercise or acquisition of Shares under an Option by any of the following means (in addition to the Company’s right to withhold from any compensation paid to the Optionee by the Company) or by a combination of such means: (i) tendering a cash payment; (ii) subject to the Committee’s approval on or prior to the payment date, authorizing the Company to withhold Shares from the Shares otherwise issuable to the Optionee as a result of the exercise or acquisition of Shares under the Option in an amount not to exceed the minimum amount of tax required to be withheld by law; or (iii) subject to Committee approval on or prior to the payment date, delivering to the Company owned and unencumbered Shares; provided that Shares acquired on exercise of Options have been held for at least 6 months from the date of exercise.

21.4

The Company and its Affiliates shall have the right to deduct from all amounts paid to an Optionee in cash (whether under this Plan or otherwise) any taxes required by law to be withheld in respect of Options under this ESOP. In the case of any Option satisfied by the issuance of Shares, no Shares shall be issued unless and until arrangements satisfactory to the Committee shall have been made to satisfy any withholding tax obligations applicable with respect to such Option. Without limiting the generality of the foregoing and subject to such terms and conditions as the Committee may impose, the Company and its Affiliates shall have the right to retain, or the Committee may, subject to such terms and conditions as it may establish from time to time, permit Optionees to elect to tender, Shares to satisfy, in whole or in part, the amount required to be withheld.

21.5

In respect of any employer’s tax liability arising only for the purpose of employment taxes such as in the case of social taxes resulting from a breach of Section 102, the Company and its Affiliates shall not bear any tax due at the time of sale of Shares, all in accordance with the provisions of Section 102.

21.6

Notwithstanding anything herein to the contrary of Section 21.5 above, only in the event of termination of employment by the Company, other than termination for Cause, the Company or its Affiliates should bear the tax liability arising only for the purpose of employment taxes such as in the case of social taxes.

21.7

For avoidance of any doubt, notwithstanding anything herein to the contrary, if termination of employment or service is for Cause, the Company and its Affiliates shall not bear any tax liability derived due to the exercise and or sale of the Options as a result of Optionee’s termination.

22.

NON-EXCLUSIVITY OF THIS ESOP

The adoption of this ESOP by the Board shall not be construed as amending, modifying or rescinding any previously approved incentive arrangements or as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation, the granting of options to purchase shares of the Company otherwise than under this ESOP, and such arrangements may be either applicable generally or only in specific cases.

For the avoidance of doubt, prior grant of options to Employees and/or Non-Employees of Traffix or its Affiliates under their employment agreements or other engagement 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 22.

23.

MULTIPLE AGREEMENTS

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

24.

DISPUTES

Any dispute or disagreement which may arise under or as a result of or pursuant to this ESOP or the individual Grant Letters shall be determined by the Board in its sole discretion and any interpretation made by the Board of the terms of this ESOP or the individual Grant Letters shall be final, binding and conclusive.

This ESOP was approved by the Board on February 18, 2012, and shall be effective as of February 21, 2012.

Exhibit 10.2

F5 N ETWORKS , I NC .

T RAFFIX A CQUISITION E QUITY I NCENTIVE P LAN

1.	P URPOSES .

(a) Eligible Stock Award Recipients. The persons eligible to receive Stock Awards are the Employees, Directors and Consultants of Traffix Communication Systems Ltd. and its Affiliates (“Traffix”) to whom the Company offers employment in connection with the Company’s acquisition of Traffix.

(b) Available Stock Awards. The purpose of the Plan is to provide a means by which eligible recipients of Stock Awards may be given an opportunity to benefit from increases in value of the Common Stock through the granting of the following Stock Awards: (i) Options and (ii) Stock Units.

(c) General Purpose. The Company, by means of the Plan, seeks to retain the services of the group of persons eligible to receive Stock Awards, to secure and retain the services of new members of this group and to provide incentives for such persons to exert maximum efforts for the success of the Company and its Affiliates.

2.	D EFINITIONS .

(a) “Affiliate” means any parent corporation or subsidiary corporation of the Company, whether now or hereafter existing, as those terms are defined in Sections 424(e) and (f), respectively, of the Code.

(b) “ Applicable Laws ” means the legal requirements relating to the administration of equity compensation plans, including under applicable U.S. state corporate laws, U.S. federal and applicable state securities laws, other U.S. federal and state laws, the Code, any stock exchange rules or regulations and the applicable laws, rules and regulations of any other country or jurisdiction where Stock Awards are granted under the Plan, as such laws, rules, regulations and requirements shall be in place from time to time.

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

(e) “Committee” means a committee appointed by the Board in accordance with subsection 3(c).

(f) “Common Stock” means the common stock of the Company.

(g) “Company” means F5 Networks, Inc., a Washington corporation.

(h) “Consultant” means any person, including an advisor, (i) who is engaged by the Company or an Affiliate to render services other than as an Employee or as a Director or (ii) who is a member of the Board of Directors of an Affiliate.

(i) “Continuous Service” means that the Participant’s service with the Company or an Affiliate, whether as an Employee, Director or Consultant, is not interrupted or terminated. The Participant’s Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which the Participant renders service to the Company or an Affiliate as an Employee, Consultant or Director or a change in the entity among the Company or an Affiliate for which the Participant renders such service, provided that there is no interruption or termination of the Participant’s Continuous Service. For example, a change in status from an Employee of the Company to a Consultant of

an Affiliate or a Director of the Company will not constitute an interruption of Continuous Service. Subject to Section 6(e)(ii), the Board or the chief executive officer of the Company, in that party’s sole discretion, may determine whether Continuous Service shall be considered interrupted in the case of any leave of absence approved by that party, including sick leave, military leave or any other personal leave.

(j) “Covered Employee” means the chief executive officer and the four (4) other highest compensated officers of the Company for whom total compensation is required to be reported to shareholders under the Exchange Act, as determined for purposes of Section 162(m) of the Code.

(k) “Director” means a member of the Board of Directors of the Company.

(l) “Disability” means the permanent and total disability of a person within the meaning of Section 22(e)(3) of the Code.

(m) “Employee” means any person employed by the Company or an Affiliate. Subject to the Applicable Laws, the determination of whether an individual (including leased and temporary employees) is an Employee hereunder shall be made by the Board (or its Committee), in its sole discretion. Mere service as a Director or payment of a director’s fee by the Company or an Affiliate shall not be sufficient to constitute “employment” by the Company or an Affiliate.

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

(o) “ Fair Market Value” means, as of any date, the value of the Common Stock determined as follows:

(i) If the Common Stock is listed on any established stock exchange or national market system (including without limitation the Nasdaq Global Select Market), the Fair Market Value of a Share shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or market (or such other exchange or market with the greatest volume of trading in the Common Stock) on the day of determination or, if the day of determination is not a market trading day, then on the last market trading day prior to the day of determination, as reported in such source or sources as the Board deems reliable, or

(ii) In the absence of such markets for the Common Stock, the Fair Market Value shall be determined in good faith by the Board.

(p) “Independent Director” means a Director who qualifies as an “independent” director under applicable Nasdaq rules (or the rules of any exchange on which the Common Stock is then listed or approved for listing).

(q) “Non-Employee Director” means a Director of the Company who either (i) is not a current Employee or Officer of the Company or its parent or a subsidiary, does not receive compensation (directly or indirectly) from the Company or its parent or a subsidiary for services rendered as a consultant or in any capacity other than as a Director (except for an amount as to which disclosure would not be required under Item 404(a) of Regulation S-K promulgated pursuant to the Securities Act (“Regulation S-K”)), does not possess an interest in any other transaction as to which disclosure would be required under Item 404(a) of Regulation S-K and is not engaged in a business relationship as to which disclosure would be required under Item 404(b) of Regulation S-K; or (ii) is otherwise considered a “non-employee director” for purposes of Rule 16b-3.

(r) “Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(s) “Option” means a nonstatutory stock option (meaning, an option not intended to qualify as an incentive stock option under Code Section 422) granted pursuant to the Plan.

(t) “Outside Director” means a Director of the Company who either (i) is not a current Employee of the Company or an “affiliated corporation” (within the meaning of Treasury Regulations promulgated under Section 162(m) of the Code), is not a former Employee of the Company or an “affiliated corporation” receiving compensation for prior services (other than benefits under a tax qualified pension plan), was not an officer of the Company or an “affiliated corporation” at any time and is not currently receiving direct or indirect remuneration from the Company or an “affiliated corporation” for services in any capacity other than as a Director or (ii) is otherwise considered an “outside director” for purposes of Section 162(m) of the Code.

(u) “Participant” means a person to whom a Stock Award is granted pursuant to the Plan or, if applicable, such other person who holds an outstanding Stock Award.

(v) “Plan” means this F5 Networks, Inc. Traffix Acquisition Equity Incentive Plan.

(w) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3, as in effect from time to time.

(x) “Securities Act” means the Securities Act of 1933, as amended.

(y) “ Share ” means a share of Common Stock, as adjusted in accordance with Section 11 below.

(z) “Stock Award” means any right involving Shares granted under the Plan, including an Option or Stock Unit.

(aa) “Stock Award Agreement” means a written agreement between the Company and a holder of a Stock Award evidencing the terms and conditions of an individual Stock Award grant. Each Stock Award Agreement shall be subject to the terms and conditions of the Plan.

(bb) “ Stock Unit ” means an award giving the right to receive Shares granted under Section 7 below.

3.	A DMINISTRATION .

(a) Administration by Board. The Board shall administer the Plan unless and until the Board delegates administration to a Committee or an administrator, as provided in subsection 3(c).

(b) Powers of Board. The Board shall have the power, subject to, and within the limitations of, the express provisions of the Plan:

(i) To determine from time to time which of the persons eligible under the Plan shall be granted Stock Awards; when and how each Stock Award shall be granted; what type or combination of types of Stock Awards shall be granted; the provisions, terms and conditions of each Stock Award granted (which need not be identical as among Participants or as among types of Stock Awards), including, without limitation: the time or times when a person shall be permitted to receive Shares pursuant to a Stock Award, the number of Shares with respect to which a Stock Award shall be granted to each such person, the exercise or purchase price (if any) of a Stock Award, the time or times when Stock Awards may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, any pro rata adjustment to vesting as a result of a Participant’s transitioning from full- to part-time service (or vice versa), and any other restriction (including forfeiture restriction), limitation or term of any Stock Award, based in each case on such factors as the Board, in its sole discretion, shall determine; provided, however, that such provisions, terms and conditions are not inconsistent with the terms of the Plan.

(ii) In order to fulfill the purposes of the Plan and without amending the Plan, to modify grants of Stock Awards to Participants who are foreign nationals or employed outside of the United States in order to recognize differences in local law, tax policies or customs.

(iii) To construe and interpret the Plan and Stock Awards granted under it, and to establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or in any Stock Award Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective.

(iv) To amend the Plan or a Stock Award as provided in Section 12.

(v) Generally, to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best interests of the Company which are not in conflict with the provisions of the Plan.

(c) Delegation to Committee. The Board may delegate administration of the Plan to a Committee or Committees of one or more members of the Board, and the term “Committee” shall apply to any person or persons to whom such authority has been delegated. In the discretion of the Board, the Committee may consist solely of two or more Outside Directors, in accordance with Section 162(m) of the Code, and/or solely of two or more Non-Employee Directors, in accordance with Rule 16b-3, and/or solely of two or more Independent Directors under applicable Nasdaq (or other exchange) rules. The Board or the Committee may further delegate its authority and responsibilities under the Plan to an Officer. However, if administration is delegated to an Officer, such Officer may grant Stock Awards only within guidelines established by the Board or the Committee, and only the Board or the Committee may make a Stock Award to an Officer or Director. If administration is delegated to a Committee, the Committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by the Board, including the power to delegate to a subcommittee any of the administrative powers the Committee is authorized to exercise (and references in this Plan to the Board shall thereafter be to the Committee or subcommittee, or an Officer to whom authority has been delegated), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan, and unless otherwise specified by the Board shall retain any authority granted to a committee or individual hereunder unto itself.

4.	S HARES S UBJECT TO THE P LAN .

(a) Share Reserve. Subject to the provisions of Section 11 relating to adjustments upon changes in stock, the stock that may be issued pursuant to Stock Awards shall not exceed in the aggregate Seventy-Five Thousand (75,000) Shares of Common Stock.

(b) Section 162(m) Limitation on Share Numbers. No Employee shall be eligible to be granted Stock Awards covering more than One Million (1,000,000) Shares during any fiscal year of the Company.

(c) Reversion of Shares to the Share Reserve. If any Stock Award shall for any reason expire or otherwise terminate, in whole or in part, without having been exercised in full, the Shares not acquired under such Stock Award shall revert to and again become available for issuance under the Plan. Further, if any previously-issued Shares are forfeited under the terms and conditions of the Stock Award, then any Shares so forfeited shall revert to and again become available for issuance under the Plan. The provisions of this Section 4(c) are qualified by Section 4(a) such that the total number of Shares issued and outstanding under the Plan at any time may not exceed the number set forth in Section 4(a) (as adjusted under Section 11).

(d) Source of Shares. The stock subject to the Plan may be unissued Shares or reacquired Shares, bought on the market or otherwise.

5.	E LIGIBILITY . Stock Awards may be granted to Employees, Directors and Consultants.

6.	O PTION P ROVISIONS .

Each Option shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The provisions of separate Options need not be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance of each of the following provisions:

(a) Term. No Option shall be exercisable after the expiration of ten (10) years from the date it was granted.

(b) Exercise Price of an Option. The exercise price of each Option shall be at least equal to the Fair Market Value of the stock subject to the Option on the date the Option is granted. Notwithstanding the foregoing, an Option may be granted with an exercise price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Section 424(a) of the Code.

(c) Consideration. The purchase price of stock acquired pursuant to an Option shall be paid, to the extent permitted by applicable statutes and regulations, either (i) in cash, check or wire transfer at the time the Option is exercised or (ii) at the discretion of the Board at the time of the grant of the Option or subsequently by (1) delivery to the Company of other Shares that have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which the Option is exercised, provided that in the case of Shares acquired, directly or indirectly, from the Company, such Shares must have been owned by the Participant for more than six (6) months on the date of surrender (or such other period as may be required to avoid the Company’s incurring an adverse accounting charge), (2) if, as of the date of exercise of an Option the Company then is permitting Employees to engage in a “same-day sale” cashless brokered exercise program involving one or more brokers, through such a program that complies with the Applicable Laws (including without limitation the requirements of Regulation T and other applicable regulations promulgated by the Federal Reserve Board) and that ensures prompt delivery to the Company of the amount required to pay the exercise price and any applicable withholding taxes, (3) in any other form of legal consideration that may be acceptable to the Board, or (4) any combination of the foregoing methods. In making its determination as to the type of consideration to accept, the Board shall consider if acceptance of such consideration may be reasonably expected to benefit the Company and the Board may, in its sole discretion, refuse to accept a particular form of consideration at the time of any Option exercise.

(d) Transferability of an Option. The Option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Participant only by the Participant. Notwithstanding the foregoing provisions of this subsection 6(d), the Participant may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of the Participant, shall thereafter be entitled to exercise the Option.

(e) Vesting.

( i) Generally. The total number of Shares of Common Stock subject to an Option may, but need not, vest and therefore become exercisable in periodic installments which may, but need not, be equal. The Option may be subject to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria) as the Board may deem appropriate. The vesting provisions of individual Options may vary. The provisions of this subsection 6(e) are subject to any Option provisions governing the minimum number of Shares as to which an Option may be exercised.

(ii) Leave of Absence. The Board (or any other party to whom such authority has been delegated, including under this Plan) shall have the discretion to determine whether and to what extent

the vesting of Options shall be tolled during any unpaid leave of absence; provided, however, that in the absence of such determination, vesting of Options shall be tolled during any such unpaid leave (unless otherwise required by the Applicable Laws). In the event of military leave, vesting shall toll during any unpaid portion of such leave, provided that, upon a Participant’s returning from military leave (under conditions that would entitle him or her to protection upon such return under the Uniform Services Employment and Reemployment Rights Act), he or she shall be given vesting credit with respect to Options to the same extent as would have applied had the Participant continued to provide services to the Company throughout the leave on the same terms as he or she was providing services immediately prior to such leave.

(f) Termination of Continuous Service. In the event a Participant’s Continuous Service terminates (other than upon the Participant’s death or Disability), the Participant may exercise his or her Option (to the extent that the Participant was vested in the Option Shares and entitled to exercise such Option as of the date of termination) but only within such period of time ending on the earlier of (i) the date three (3) months following the termination of the Participant’s Continuous Service (or such longer or shorter period specified in the Option Agreement), or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Participant does not exercise his or her Option within the time specified in the Option Agreement, the Option shall terminate.

(g) Extension of Termination Date. Following the termination of the Participant’s Continuous Service (other than upon the Participant’s death or Disability), if the Participant would be prohibited at any time solely because the issuance of Shares would violate the registration requirements under the Securities Act or violate any prohibition on trading on the basis of possession of material nonpublic information involving the Company and its business, then the Option shall terminate on the earlier of (i) the expiration of the term of the Option set forth in subsection 6(a), or (ii) the expiration of a period of three (3) months after the termination of the Participant’s Continuous Service during which the exercise of the Option would not be in violation of such requirements.

(h) Disability of Participant. In the event a Participant’s Continuous Service terminates as a result of the Participant’s Disability, the Participant may exercise his or her Option (to the extent that the Participant was vested in the Option Shares and entitled to exercise the Option as of the date of termination), but only within such period of time ending on the earlier of (i) the date twelve (12) months following such termination (or such longer or shorter period specified in the Option Agreement) or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Participant does not exercise his or her Option within the time specified herein, the Option shall terminate.

(i) Death of Participant. In the event (i) a Participant’s Continuous Service terminates as a result of the Participant’s death or (ii) the Participant dies within the period (if any) specified in the Option Agreement after the termination of the Participant’s Continuous Service for a reason other than death, then the Option may be exercised (to the extent the Participant was vested in the Option Shares and entitled to exercise the Option as of the date of death) by the Participant’s estate, by a person who acquired the right to exercise the Option by bequest or inheritance or by a person designated to exercise the Option upon the Participant’s death pursuant to subsection 6(d), but only within the period ending on the earlier of (1) the date eighteen (18) months following the date of death (or such longer or shorter period specified in the Option Agreement) or (2) the expiration of the term of such Option as set forth in the Option Agreement. If, after death, the Option is not exercised within the time specified herein, the Option shall terminate.

(j) Exercise Generally. Options shall be considered exercised when the Company (or its authorized agent) receives (i) written or electronic notice from the person entitled to exercise the Option of intent to exercise a specific number of Shares, (ii) full payment or appropriate provision for payment in a form and method acceptable to the Board or Committee, for the Shares being exercised, and (iii) if applicable, payment or appropriate provision for payment of any withholding taxes due on exercise. An Option may not be exercised for a fraction of a Share. The Option may, at the discretion of the Board or Committee, include a provision whereby the Participant may elect to exercise the Option as to Shares that are not yet vested. Unvested Shares exercised in such manner may be subject to a Company repurchase right under Section 10(f) or such other restrictions or conditions as the Board or Committee may determine.

(k) Administrator Discretion. Notwithstanding the provisions of this Section 6, the Board or the Committee shall have complete discretion exercisable at any time to (i) extend the period of time for which an Option is to remain exercisable, following the Participant’s termination of Continuous Service, but in no event beyond the expiration date for the Option, and (ii) permit the Option to be exercised, during the applicable post-termination exercise period, not only with respect to the number of Shares that were vested on the date of termination, but also with respect to additional Shares on such terms and conditions as the Board or Committee may determine.

7.	P ROVISIONS OF S TOCK A WARDS OTHER THAN O PTIONS .

Each Stock Award Agreement reflecting the issuance of a Stock Unit shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. The terms and conditions of such agreements may change from time to time, and the terms and conditions of separate agreements need not be identical, but each such agreement shall include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions:

(a) Consideration. A Stock Unit may be awarded in consideration for such property or services as is permitted under Applicable Law, including for past services actually rendered to the Company or an Affiliate for its benefit.

(b) Vesting; Restrictions. Shares of Common Stock awarded under the agreement reflecting a Stock Unit may, but need not, be subject to a Share repurchase option, forfeiture restriction or other conditions in favor of the Company in accordance with a vesting or lapse schedule to be determined by the Board.

(c) Termination of Participant’s Continuous Service. In the event a Participant’s Continuous Service terminates, the Company may reacquire any or all of the Shares of Common Stock held by the Participant which have not vested or which are otherwise subject to forfeiture or other conditions as of the date of termination under the terms of the agreement.

(d) Transferability. Rights to acquire Shares of Common Stock under a Stock Unit agreement shall not be transferable except by will or by the laws of descent and distribution, and Shares of Common Stock issued upon vesting of a Stock Unit shall be issuable during the lifetime of the Participant only to the Participant. Notwithstanding the foregoing provisions of this subsection 7(d), the Participant may, by delivering written notice to the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of the Participant, shall thereafter be entitled to receive Shares of Common Stock issued upon vesting of a Stock Unit.

8.	C OVENANTS OF THE C OMPANY .

(a) Availability of Shares. During the terms of the Stock Awards, the Company shall keep available at all times the number of Shares of Common Stock required to satisfy such Stock Awards.

(b) Securities Law Compliance. The Company shall seek to obtain from each regulatory commission or agency having jurisdiction over the Plan such authority as may be required to grant Stock Awards and to issue and sell Shares upon exercise of the Stock Awards; provided, however, that this undertaking shall not require the Company to register under the Securities Act the Plan, any Stock Award or any stock issued or issuable pursuant to any such Stock Award. If, after reasonable efforts, the Company is unable to obtain from any such regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of stock under the Plan, the Company shall be relieved from any liability for failure to issue and sell stock upon exercise of such Stock Awards unless and until such authority is obtained.

9.	U SE OF P ROCEEDS FROM S TOCK ; U NFUNDED P LAN .

Proceeds from the sale of stock pursuant to Stock Awards shall constitute general funds of the Company. The Plan shall be unfunded. Although bookkeeping accounts may be established with respect to Participants who are granted Stock Awards hereunder, any such accounts will be used merely as a bookkeeping convenience. The Company shall not be required to segregate any asset which may at any time be represented by Stock Awards, nor shall this Plan be construed as providing for such segregation, nor shall the Company nor any party authorized to administer the Plan be deemed to be a trustee of stock or cash to be awarded under the Plan. Any liability of the Company to any Participant with respect to a Stock Award shall be based solely upon any contractual obligations which may be created by the Plan; no such obligation of the Company shall be deemed to be secured by any pledge or other encumbrance on any property of the Company. Neither the Company nor any party authorized to administer the Plan shall be required to give any security or bond for the performance of any obligation which may be created by this Plan.

10.

M ISCELLANEOUS .

(a) Acceleration of Exercisability and Vesting. The Board shall have the power to accelerate the time at which a Stock Award may first be exercised or the time during which a Stock Award or any part thereof will vest, become exercisable or be settled in accordance with the Plan, notwithstanding the provisions in the Stock Award stating the time at which it may first vest, be exercised or be settled.

(b) Shareholder Rights. No Participant shall be deemed to be the holder of, or to have any of the rights of a holder with respect to, any Shares subject to such Stock Award unless and until such Participant has satisfied all requirements for exercise of the Stock Award pursuant to its terms.

(c) No Employment or other Service Rights. Nothing in the Plan or any instrument executed or any Stock Award granted pursuant thereto shall confer upon any Participant or other holder of Stock Awards any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Stock Award was granted or shall affect the right of the Company or an Affiliate to terminate (i) the employment of an Employee with or without notice and with or without cause, (ii) the service of a Consultant pursuant to the terms of such Consultant’s agreement with the Company or an Affiliate or (iii) the service of a Director pursuant to the Bylaws of the Company or an Affiliate, and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be.

(d) Investment Assurances. The Company may require a Participant, as a condition of exercising or acquiring Shares under any Stock Award, (i) to give written assurances satisfactory to the Company as to the Participant’s knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory to the Company who is knowledgeable and experienced in financial and business matters and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the Stock Award; and (ii) to give written assurances satisfactory to the Company stating that the Participant is acquiring the stock subject to the Stock Award for the Participant’s own account and not with any present intention of selling or otherwise distributing the stock. The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if (iii) the issuance of the Shares upon the exercise or acquisition of stock under the Stock Award has been registered under a then currently effective registration statement under the Securities Act or (iv) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then applicable securities laws. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to comply with applicable securities laws, including, but not limited to, legends restricting the transfer of the stock.

(e) Withholding Obligations. To the extent provided by the terms of a Stock Award Agreement, the Participant may satisfy any federal, state or local tax withholding obligation relating to the exercise or acquisition of Shares under a Stock Award by any of the following means (in addition to the

Company’s right to withhold from any compensation paid to the Participant by the Company) or by a combination of such means: (i) tendering a cash payment; (ii) authorizing the Company to withhold Shares from the Shares otherwise issuable to the Participant as a result of the exercise or acquisition of stock under the Stock Award; or (iii) delivering to the Company owned and unencumbered Shares.

(f) Stock Unit Repurchase Limitation. The terms of any repurchase option for a Stock Unit shall be specified in the Stock Award and may be at the Fair Market Value of the stock subject to the Stock Award at the time of repurchase, at the original price or on such terms and conditions as the Board may determine (and as shall be reflected in the Stock Award Agreement); provided however that this Section 10(f) shall in no way limit the Company’s ability to adjust any Stock Award as provided under Section 11 below.

(g) Cancellation and Re-Grant of Options. The Company may not reprice any outstanding Stock Awards under the Plan, including implement any program whereby outstanding Stock Awards will be cancelled and replaced with Stock Awards bearing a lower purchase or exercise price, without first obtaining the approval of the shareholders of the Company; provided however that this Section 10(g) shall in no way limit the Company’s ability to adjust Stock Awards as provided under Section 11 below.

(h) Interpretation of Plan and Stock Awards . In the event that any provision of the Plan or any Stock Award granted under the Plan is declared to be illegal, invalid or otherwise unenforceable by a court of competent jurisdiction, such provision shall be reformed, if possible, to the extent necessary to render it legal, valid and enforceable, or otherwise deleted, and the remainder of the terms of the Plan and/or Stock Award shall not be affected to the extent necessary to reform or delete such illegal, invalid or unenforceable provision. All questions arising under the Plan or under any Stock Award shall be decided by the Board or the Committee in its or their total and absolute discretion and such decisions shall be final and binding on all parties.

(i) Electronic Communication . Any document required to be delivered under the Plan, including under the Applicable Laws, may be delivered in writing or electronically. Signature may also be electronic if permitted by the Board or the Committee, and if permitted by Applicable Law.

(j) Escrow of Shares . To enforce any restriction applicable to Shares issued under the Plan, the Board or the Committee may require a Participant or other holder of such Shares to deposit the certificates representing such Shares, with approved stock powers or other transfer instruments endorsed in blank, with the Company or an agent of the Company until the restrictions have lapsed. Such certificates (or other notations representing the Shares) may bear a legend or legends referencing the applicable restrictions.

11.

A DJUSTMENTS UPON C HANGES IN S TOCK .

(a) Capitalization Adjustments. If any change is made in the stock subject to the Plan, or subject to any Stock Award, without the receipt of consideration by the Company (through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other transaction not involving the receipt of consideration by the Company), the Plan will be appropriately adjusted in the class(es) and maximum number of securities subject to the Plan pursuant to subsection 4(a) and the maximum number of securities subject to award to any person pursuant to subsection 4(b), and the outstanding Stock Awards will be appropriately adjusted in the class(es) and number of securities and price per Share of stock subject to such outstanding Stock Awards. The Board, the determination of which shall be final, binding and conclusive, shall make such adjustments. (The conversion of any convertible securities of the Company shall not be treated as a transaction “without receipt of consideration” by the Company.)

(b) Change in Control—Dissolution or Liquidation. In the event of a dissolution or liquidation of the Company, then such Stock Awards shall be terminated if not exercised (if applicable) prior to such event.

(c) Change in Control—Asset Sale, Merger, Consolidation or Reverse Merger or Acquisition of Stock.

(i) In the event of (1) a sale of substantially all of the assets of the Company, or (2) a merger or consolidation in which the Company is not the surviving corporation or (3) a reverse merger in which the Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger are converted by virtue of the merger into other property, whether in the form of securities, cash or otherwise, or (4) the direct or indirect acquisition (including by way of a tender or exchange offer) by any person, or persons acting as a group, of beneficial ownership or a right to acquire beneficial ownership of shares representing a majority of the voting power of the then outstanding shares of capital stock of the Company , then any surviving corporation or acquiring corporation shall assume any Stock Awards outstanding under the Plan or shall substitute similar awards (including with respect to a Stock Award an award to acquire the same consideration paid to the shareholders in the transaction described in this subsection 11(c) for those outstanding under the Plan).

(ii) For purposes of subsection 11(c) a Stock Award shall be deemed assumed if, following the change in control, the Stock Award confers the right to purchase in accordance with its terms and conditions, for each share of Common Stock subject to the Stock Award immediately prior to the change in control, the consideration (whether stock, cash or other securities or property) to which a holder of a share of Common Stock on the effective date of the change in control was entitled.

(iii) Subject to the provisions of any Stock Award Agreement, in the event any surviving corporation or acquiring corporation refuses to assume such Stock Awards or to substitute similar stock awards for those outstanding under the Plan, then with respect to Stock Awards held by Participants whose Continuous Service has not terminated, the vesting of 50% of such Stock Awards (and, if applicable, the time during which such Stock Awards may be exercised or settled) shall be accelerated in full, and the Stock Awards shall terminate if not exercised or settled (if applicable) at or prior to such event. With respect to any other Stock Awards outstanding under the Plan, such Stock Awards shall terminate if not exercised (if applicable) prior to such event.

(iv) The Board shall at all times have the authority, in its sole discretion, to provide for additional or different vesting, exercisability, settlement or forfeiture conditions with respect to Stock Awards than that reflected in this Section 11(c), provided that its determinations in this regard shall be reflected in the Stock Award Agreement (including in amendments thereto) issued to the affected Participant.

12.

A MENDMENT OF THE P LAN AND S TOCK A WARDS .

(a) Amendment of Plan. The Board at any time, and from time to time, may amend the Plan. However, except as provided in Section 11 relating to adjustments upon changes in stock, no amendment shall be effective unless approved by the shareholders of the Company to the extent shareholder approval is necessary to satisfy the requirements of Rule 16b-3 or any Nasdaq or securities exchange listing requirements.

(b) Shareholder Approval. Stock Awards issued pursuant to the Plan are intended to comply with Nasdaq Listing Rule 5635(c)(4). To the extent applicable, the Board may, in its sole discretion, submit any other amendment to the Plan for shareholder approval, including, but not limited to, amendments to the Plan intended to satisfy the requirements of Section 162(m) of the Code and the regulations thereunder regarding the exclusion of performance-based compensation from the limit on corporate deductibility of compensation paid to certain executive officers.

(c) Contemplated Amendments. It is expressly contemplated that the Board may amend the Plan in any respect the Board deems necessary or advisable to provide eligible Employees with the maximum benefits provided or to be provided under the provisions of the Code or any other Applicable Law.

(d) No Impairment of Rights. Rights under any Stock Award granted before amendment of the Plan shall not be materially impaired by any amendment of the Plan unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing.

(e) Amendment of Stock Awards. The Board at any time, and from time to time, may amend the terms of any one or more Stock Awards; provided, however, that the rights under any Stock Award shall not be materially impaired by any such amendment unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing.

13.

T ERMINATION OR S USPENSION OF THE P LAN .

(a) Plan Term. The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the Plan shall terminate on the day before the tenth (10th) anniversary of the date the Plan is adopted by the Board. No Stock Awards may be granted under the Plan while the Plan is suspended or after it is terminated.

(b) No Impairment of Rights. Suspension or termination of the Plan shall not materially impair rights and obligations under any Stock Award granted while the Plan is in effect except with the written consent of the Participant.

14.

E FFECTIVE D ATE OF P LAN .

The Plan was approved by the Board on February 18, 2012, and shall be effective as of February 21, 2012.

15.

G OVERNING L AW . All questions concerning the construction, validity and interpretation of this Plan shall be governed by the law of the State of Washington, without regard to such states conflict of laws rules.

F5 NETWORKS, INC.

TRAFFIX ACQUISITION EQUITY PLAN

Sub-Plan for Israeli Participants

1.	GENERAL

1.1

This sub-plan (the “ Sub-Plan ”) shall apply only to Participants who are residents of the State of Israel upon the date of grant of the Award, as defined below in Section 2, or who are deemed Israeli tax residents (collectively, “ Israeli Participants ”). The provisions specified hereunder shall form an integral part of the F5 Networks, Inc. Traffix Acquisition Equity Plan (hereinafter the “ Plan ”).

1.2

This Sub-Plan is to be read as a continuation of the Plan and modifies Awards granted to Israeli Participants only to the extent necessary to comply with the requirements set by the Israeli law in general, and in particular, with the provisions of the Israeli Income Tax Ordinance [New Version] 5721-1961, as may be amended or replaced from time to time. This Sub-Plan does not add to or modify the Plan in respect of any other category of Participants.

1.3

The Plan and this Sub-Plan are complementary to each other and shall be deemed as one. In the event of any conflict, whether explicit or implied, between the provisions of this Sub-Plan and the Plan, the provisions set out in the Sub-Plan shall prevail.

1.4

Any capitalized term not specifically defined in this Sub-Plan shall be construed according to the interpretation given to it in the Plan.

2.	DEFINITIONS

2.1

“ 102 Award ” means any Award granted to an Approved Israeli Participant pursuant to Section 102 of the Ordinance.

2.2

“ Approved Israeli Participant ” means an Israeli Participant who is an Employee, Director or an Officer of any Israeli resident Affiliate of the Company, including without limitation Traffix Communication Systems Ltd., excluding any Controlling Shareholder of the Company, provided that the Affiliate is an Israeli resident company or otherwise meets the definition of an Employing Company under Section 102.

2.3

“ Award ” solely for the purpose of this Sub-Plan means any Stock Award granted by the Company to an Israeli Participant, in accordance with the provisions of the Plan.

2.4

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

2.5

“ Controlling Shareholder ” shall have the meaning ascribed to it in Section 32(9) of the Ordinance.

2.6

“ Israeli Stock Award Agreement ” means the Award Agreement between the Company and an Israeli Participant that sets out the terms and conditions of an Award.

2.7

“ ITA ” means the Israeli Tax Authority.

2.8

“ Non-Trustee 102 Award ” means a 102 Award granted pursuant to Section 102(c) of the Ordinance and not held in trust by a Trustee.

2.9

“ Ordinance ” means the Israeli Income Tax Ordinance [New Version] 5721-1961, as now in effect or as hereafter amended.

2.10

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

2.11

“ Section 102 ” means Section 102 of the Ordinance and any regulations, rules, orders or procedures promulgated thereunder as now in effect or as hereafter amended.

2.12

“ Tax ” means any applicable tax and other compulsory payments such as social security and health tax contributions under any applicable law.

2.13

“ Trustee ” means any person or entity appointed by the Company to serve as a trustee and approved by the ITA, all in accordance with the provisions of Section 102(a) of the Ordinance, as may be replaced from time to time.

2.14

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

2.15

“ Unapproved Israeli Participant ” means an Israeli Participant who is not an Approved Israeli Participant, including a consultant or a Controlling Shareholder of the Company.

3.	ISSUANCE OF AWARDS

3.1

The persons eligible for participation in the Plan as Israeli Participants shall include Approved Israeli Participants and Unapproved Israeli Participants, provided, however, that only Approved Israeli Participants may be granted 102 Awards.

3.2

The Company may designate Awards granted to Approved Israeli Participants pursuant to Section 102 as Trustee 102 Awards or Non-Trustee 102 Awards.

3.3

Unless a special ruling is received from the ITA, the grant of Trustee 102 Awards shall not be made until 30 days from the date the Plan has been submitted for approval by the ITA and shall be conditioned upon the approval of the Plan and this Sub-Plan by the ITA.

3.4

Trustee 102 Awards may either be classified as Capital Gain Awards (CGAs) or Ordinary Income Awards (OIAs).

3.5

No Trustee 102 Award may be granted under this Sub-Plan to any Approved Israeli Participant, unless and until the Company has filed with the ITA its election regarding the type of Trustee 102 Awards, whether CGAs or OIAs, that will be granted under the Plan and this Sub-Plan (the “ Election ”). Such Election shall become effective beginning the first date of grant of a Trustee 102 Award under this Sub-Plan and shall remain in effect at least until the end of the year following the year during which the Company first granted Trustee 102 Awards. The Election shall obligate the Company to grant only the type of Trustee 102 Award it has elected, and shall apply to all Israeli Participants who are granted Trustee 102 Awards during the period indicated herein, all in accordance with the provisions of Section 102(g) of the Ordinance. The Election shall not prevent the Company from granting Non-Trustee 102 Awards simultaneously.

3.6

All Trustee 102 Awards must be held in trust by, or subject to the approval of the ITA, under the control or supervision of a Trustee, as described in Section 4 below.

3.7

The designation of Non-Trustee 102 Awards and Trustee 102 Awards shall be subject to the terms and conditions set forth in Section 102.

3.8

Awards granted to Unapproved Israeli Participants shall be subject to tax according to the provisions of the Ordinance and shall not be subject to the Trustee arrangement detailed herein.

4.	TRUSTEE

4.1

Trustee 102 Awards which shall be granted under this Sub-Plan and/or any Share allocated or issued upon exercise of a Trustee 102 Award and/or other Shares received following any realization of rights under the Plan, shall be allocated or issued to the Trustee or controlled by the Trustee, for the benefit of the Approved Israeli Participants, in accordance with the provisions of Section 102. In the event that the requirements for Trustee 102 Awards are not met, the Trustee 102 Awards may be regarded as Non-Trustee 102 Awards or as Awards which are not subject to Section 102, all in accordance with the provisions of Section 102.

4.2

With respect to any Trustee 102 Award, subject to the provisions of Section 102, an Approved Israeli Participant shall not sell or release from trust any Share received upon the exercise of a Trustee 102 Award and/or any Share received following any realization of rights, including, without limitation, stock dividends, under the Plan at least until the lapse of the period of time required under Section 102 or any shorter period of time determined by the ITA (the “ Holding Period ”). Notwithstanding the above, if any such sale or release occurs during the Holding Period, the sanctions under Section 102 shall apply to and shall be borne by such Approved Israeli Participant.

4.3

Notwithstanding anything to the contrary, the Trustee shall not release or sell any Shares allocated or issued upon exercise of a Trustee 102 Award unless the Company, its relevant Israeli Affiliate and the Trustee are satisfied that the full amounts of Tax due have been paid or will be paid.

4.4

Upon receipt of any Trustee 102 Award, the Approved Israeli Participant will consent to the grant of the Award under Section 102 and undertake to comply with the terms of Section 102 and the trust arrangement between the Company and the Trustee.

5.	THE AWARDS

The terms and conditions upon which the Awards shall be issued and exercised or vest, as applicable, shall be specified in the Israeli Stock Award Agreement to be executed pursuant to the Plan and to this Sub-Plan. Each Israeli Stock Award Agreement shall state, inter alia , the number of Shares to which the Award relates, the type of Award granted thereunder ( i.e. , a CGA, OIA or Non-Trustee 102 Award), and any applicable vesting provisions and exercise price that may be payable.

6.	EXERCISE AND VESTING OF AWARDS

Vesting and exercise of Awards granted to Israeli Participants shall be subject to the terms and conditions and, with respect to exercise, the method, as may be determined by the Company (including the provisions of the Plan) and, when applicable, by the Trustee, in accordance with the requirements of Section 102.

7.	ASSIGNABILITY, DESIGNATION AND SALE OF AWARDS

7.1.

Notwithstanding any other provision of the Plan, no Award or any right with respect thereto, or purchasable hereunder, whether fully paid or not, shall be assignable, transferable or given as collateral, or any right with respect to any Award given to any third party whatsoever, and during the lifetime of the Israeli Participant, each and all of such Israeli Participant’s rights with respect to an Award shall belong only to the Israeli Participant. Any such action made directly or indirectly, for an immediate or future validation, shall be void.

7.2

As long as Awards or Shares issued or purchased hereunder are held by the Trustee on behalf of the Israeli Participant, all rights of the Israeli Participant over the Shares cannot be transferred, assigned, pledged or mortgaged, other than by will or laws of descent and distribution.

8.	INTEGRATION OF SECTION 102 AND TAX ASSESSING OFFICER’S APPROVAL

8.1.

With regard to Trustee 102 Awards, the provisions of the Plan and/or the Sub-Plan and/or the Israeli Stock Award Agreement shall be subject to the provisions of Section 102 and any approval issued by the ITA and the said provisions shall be deemed an integral part of the Plan, the Sub-Plan and the Israeli Stock Award Agreement.

8.2.

Any provision of Section 102 and/or said approval issued by the ITA which must be complied with in order to receive and/or to maintain any tax Award pursuant to Section 102, which is not expressly specified in the Plan, the Sub-Plan or the Israeli Stock Award Agreement, shall be considered binding upon the Company, the relevant Israeli Affiliate and the Israeli Participants.

9.	DIVIDEND

Subject to the provisions of the Plan, with respect to all Shares allocated or issued subsequent to the exercise or vesting of Awards granted to the Israeli Participant and held by the Israeli Participant or by the Trustee, as the case may be, the Israeli Participant shall be entitled to receive dividends, if any, in accordance with the quantity of such Shares, subject to the provisions of the Company’s Articles of Incorporation (and all amendments thereto) and subject to any applicable taxation on distribution of dividends, and when applicable subject to the provisions of Section 102 and the rules, regulations or orders promulgated thereunder.

10.

TAX CONSEQUENCES

10.1

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

10.2

The Company and/or, when applicable, the Trustee shall not be required to release any Award or Share to an Israeli Participant until all required Tax payments have been fully made.

10.3

With respect to Non-Trustee 102 Awards, if the Israeli Participant ceases to be employed by the Company or any Affiliate, or otherwise if so requested by the Company or the Affiliate, the Israeli Participant shall extend to the Company and/or the Affiliate a security or guarantee for the payment of Tax due at the time of sale of Shares, in accordance with the provisions of Section 102.

11.

TERM OF PLAN AND SUB-PLAN

Notwithstanding anything to the contrary in the Plan and in addition thereto, the Company may obtain all approvals for the adoption of this Sub-Plan or for any amendment to this Sub-Plan as are necessary to comply with any law applicable to Awards granted to Israeli Participants under this Sub-Plan or with the Company’s incorporation documents.

12.

ONE TIME AWARD

The Awards and underlying Shares are extraordinary, one-time Awards granted to the Participants, and are not and shall not be deemed a salary component for any purpose whatsoever, including in connection with calculating severance compensation under applicable law.

* * *

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of our report dated November 22, 2011 relating to the financial statements and the effectiveness of internal control over financial reporting, which appears in F5 Networks, Inc.’s Annual Report on Form 10-K for the year ended September 30, 2011.

PricewaterhouseCoopers LLP

Seattle, Washington

February 29 , 2012