Contract
EXHIBIT10.13
TRANSLATION
FROM HEBREW
State of
Israel
Ministry
of Industry and Trade, Office of the Chief Scientist
Technological
Innovation Incubator Program Administration
Date:
August 18, 2005
Registered
To:
Xxxxxxxx
Xxxxxxxx
BioLine
Dear Sir
or Madam,
Re: Agreement to Establish a
Center run as an Incubator:
File:
35583
Enclosed
please find an agreement/amendment to an agreement for the operation of a
technological innovation center as an incubator, signed by all
parties.
Please
confirm the receipt of this agreement in writing.
Sincerely,
<Signature>
Rina
Pridor
Director,
Technological Innovation Incubator Program
Rubber
stamp: Received: 8-28-2005
Agreement
to Operate a Biotechnology Incubator
Drawn up
and signed in Jerusalem on _________
Between
The
Government of Israel, on behalf of the State of Israel, represented by the Chief
Scientist and the Controller of the Ministry of Industry, Trade, and Employment
(hereinafter “the State”);
And
The
BioLine Innovations Jerusalem Limited Partnership Biotechnology Incubator,
corporate No. 000000000
by Xxxx
Xxxxxxx, ID No. 000000000
and
Xxxxxx Xxxxxx, ID No. 000000000
Its
authorized signatories (hereinafter “the Incubator”);
Whereas
The
Incubator is a center for biotechnological research and development run as an
incubator, as designated in the operating plan attached to this agreement,
marked Appendix A;
And
whereas
The
Incubator commits itself to operate as a Type-2 Incubator, pursuant to the
Guidelines issued by the director general of the Ministry of Industry and Trade,
No. 8.4 (hereinafter “the director general’s Guidelines”), the provisions of
this agreement, the operating plan, the certificate of approval, and the
statement of commitment to the entire project and the directives of the
Biotechnology Incubator Committee (all of them together: “the
Provisions”);
And
whereas
The State
is interested in the operation of the incubator as a physical, organizational,
professional, marketing, and business framework for research and development
projects in the field of biotechnology with commercial purposes, and all of
this, as detailed in the present agreement;
Now
therefore be it stated, agreed, and stipulated by the parties as
follows:
1.
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1.1
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The
preamble to this agreement and its appendices are integral parts
thereof.
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1.2
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All
definitions not stated in this agreement are to be understood as defined
in the director general’s
Guidelines.
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2.
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The
representative of the State for the purposes of this agreement is the
Chief Scientist of the Ministry of Industry and Trade (hereinafter “the
Chief Scientist”) or his
representative.
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3.
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The
purpose of this agreement is to govern the State’s support for the
operation of the incubator, which will provide a physical, organizational,
professional, marketing, and business framework for research and
development projects in the field of biotechnology with commercial
purposes (hereinafter “the Incubator Project” or “the Incubator
Projects”).
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4.
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The
term of this agreement shall be a period of six years, beginning on
January 1, 2005, and concluding on December 31, 2010 (hereinafter “the
Term of the Agreement”). The Incubator will be entitled to submit, after
the lapse of 48 months from the beginning of the Term of the Agreement, a
request to extend the Term of the Agreement by three additional years.
Should such a request be submitted, the Biotechnology Incubators
Committee, as defined below, is entitled to reject it or approve it, to
stipulate conditions, or to introduced amendments to this agreement or to
set a shorter extension period. The Biotechnology Incubators Committee
shall notify the Incubator in writing of its decision on the request for
an extension within 90 days. Should the extension of the Term of the
Agreement be approved, the Incubator shall be entitled to sign the
extension document within 30 days of receiving notification from the
committee.
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5.
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Definitions
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5.1
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State
Loan: The loan approved by the Biotechnology Incubators Committee for the
Incubator for a project for its implementation, pursuant to the
Certificate of Approval for the implementation of that project and in
keeping with the Provisions.
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5.2
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Project
agreement: an agreement between a Type-1 Biotechnology Incubator and the
Project Company, as defined
below.
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5.3
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The
Biotechnology Incubators Committee: as defined in section 2.4 of the
director general’s Guidelines (hereinafter “the
Committee”).
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5.4
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Franchise
holder: as defined in section 2.4 of the director general’s
Guidelines.
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5.5
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Project
company: as defined in section 2.5 of the director general’s
Guidelines.
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5.6
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Type-1
Biotechnology Incubator: as defined in section 2.3.1 of the director
general’s Guidelines.
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5.7
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Type-2
Biotechnology Incubator: as defined in section 2.3.2 of the director
general’s Guidelines.
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5.8
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Incubator:
a type-1 or type-2 Biotechnology Incubator as defined
above.
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5.9
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Entrepreneur:
as defined in section 2.2 of the director general’s
Guidelines.
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5.10
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Certificate
of Approval: A certificate signed by the Chief Scientist, stipulating the
conditions of implementation of the R&D work by every Project Company
and/or Project that is housed in the Incubator, and governing the issuing
of state loans to the Incubator and/or the Project Company and/or the
Project.
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5.11
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Encumbered
Project Assets: As defined in section 5.14 of the director general’s
Guidelines.
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5.12
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Incubator
Project: As defined in section 2.6 of the director general’s
Guidelines.
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5.13
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Intellectual
Property: The expertise and experience accumulated by the Incubator and/or
the Project Company and/or anyone acting on their behalf, the trade
secrets that are relevant, directly and/or indirectly, to the operation of
the Incubator and/or the Project Company and/or the Project, as well as
the patents, copyrights, trademarks, trade names, trade secrets,
inventions, samples, processes, computer programs, technical data, any
agreement and/or license for implementing the project in any stage
whatsoever, specific trials on an animal model, synthesis of compounds,
preclinical trials and their outcomes, and any other intangible rights,
whether registered or not registered, associated with the operation of the
Incubator and/or the Project Company and/or the
Project.
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5.14
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Interest:
As per the interest rate set in the Award of Interest and Linkage Law
5721-1961.
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5.15
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Operating
plan: the plan for operating the incubator submitted to and approved by
the Committee and/or as it may be updated from time to time with the
approval of the Committee, including the operating budget of the
Incubator, all as stipulated in Appendix
A.
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5.16
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Project
Implementation: As defined in the Certificate of Approval for that Project
and pursuant to the director general’s
Guidelines.
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5.17
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Allowed
Overhead: A payment by a Project Company and/or Project to the Incubator
on account of outlays for project overhead, in a total amount not to
exceed 20% (twenty percent) of the labor costs in the approved budget of
that Project Company and/or
Project.
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6.
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The
Incubator hereby affirms as
follows:
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6.1
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That
it is organized and registered as an Israeli for-profit corporation whose
goal is the successful operation of the Incubator. The details of its
incorporation, including its certificate of incorporation and an
up-to-date report from the Office of the Registrar of Companies, its
bylaws, founders’ agreement, and statement of signatory rights certified
by the Incubator’s attorney are attached to the present agreement as
Appendix B.
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6.2
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That,
no later than the end of three months from the date of signing of this
agreement, the Incubator will operate and be the owner or have leasehold
rights of an appropriate structure approved in advance by the Committee
for the housing and implementation of at least eight projects with
approximately five employees per project. The structure will also include
the infrastructure appropriate for the operation of a central equipment
lab, as detailed in section 7.6 of the present agreement (hereinafter “the
Structure”). Any change in the identity and/or nature of the leasehold
shall require the advance approval of the Incubators
Committee.
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6.3
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That
it has the expertise, experience, and professional and economic capacity
to manage the incubator pursuant to this agreement and the Provisions, and
to provide the Project or Projects with a physical, organizational,
professional, marketing, and business environment for conducting research
and development in the field of biotechnology for commercial
purposes.
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6.4
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That
it has access to first-class consulting services, including in the
following fields: legal counsel, patents, quality control, regulatory
affairs and clinical trials, information management, and bookkeeping and
financial advice.
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7.
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The
Incubator undertakes:
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7.1
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To
prepare the structure and make it suitable for the needs of running the
Project or Projects, as may be
required.
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7.2
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To
manage the incubator, with all its functions, by means of an
administrative staff, in a professional manner, in keeping with the
Provisions and to faithfully satisfy all provisions that may be in force
at that time.
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7.3
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To
employ a fulltime general manager for the incubator, with the appropriate
skills (hereinafter “General
Manager”).
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7.4
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To
employ a fulltime administrative director for the incubator, as well as a
secretarial and bookkeeping staff with the appropriate skills,
proportional to the scale of the incubator’s
activities.
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7.5
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To
employ, in addition to the above, one assistant manager with the
professional and business skills appropriate for the field for every three
projects being carried out in the incubator, starting from the first
project.
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7.6
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To
establish and operate a central lab for all the projects (hereinafter “the
Lab”).
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7.6.1
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To employ a fulltime manager or operator of the central Lab, with the
appropriate skills. During its first year of activity the Incubator is
entitled to satisfy this obligation by means of an outside contractor that
runs the Lab and/or to employ a part-time manager
only.
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7.6.2
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To set up and operate the Lab no later than the end of the first year of
the Incubator’s activity, as per the requirements included in section 4.2
of the director general’s
Guidelines.
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7.7
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To
train the project managers to work according to quality
principles.
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7.8
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To
operate the Incubator for at least six years and to invest in its
operation an annual sum of not less than NIS 2,700,000 (two million seven
hundred thousand) for each year of operation (as defined below) for the
Term of the Agreement (hereinafter the “Total Investment”). The Total
Investment will be linked to the Consumer Price Index published in
February 2004. The Total Investment will be updated once at the start of
each year as a function of the rise in the index from February 2004 to
January of that year (hereinafter the “Updated Total Investment”). It is
stipulated that should the cumulative change in the index be negative, the
Total Investment will not be decreased. To eliminate any doubt, the Total
Investment shall be in addition to the supplementary financing required
for each Incubator project and for the Allowed Overhead as part of the
Project’s approved budget project, and in addition to financing equipment
for the Lab and its maintenance, as stipulated in section 7.6
above.
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7.9
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Bank
Guarantee
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7.9.1
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To guarantee the Incubator’s undertakings under the present agreement, the
Incubator and/or its controlling party will convey a linked bank guarantee
payable to the State in the amount of NIS 8,100,000 (eight million
one-hundred thousand), linked to the Consumer Price Index published in
February 2004, which will remain in force until the passage of three
months after the Term of the Agreement, in the form attached to the
present agreement as Appendix
C.
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7.9.2
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It is stipulated and agreed that after the lapse two years from the start
of the Term of the Agreement, the amount of the bank guarantee to the
State will be reduced on account of any reported outlays approved by the
Chief Scientist and included in the approved budget of the Incubator. This
reduction will be at the rate of 50% (fifty percent) of the outlays
reported as above, which will not be less than NIS 500,000 (five hundred
thousand), but the sum of the Guarantee will not fall, in any case and at
any time, to less than NIS 1,500,000 (one million five-hundred thousand),
and as specified in Appendix C to the present
agreement.
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7.10
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Not
to charge any fee to the Project Company and/or an Incubator Project for
the operation or use of equipment in the Lab and/or any other expenditure
associated with the Lab or for the personnel to run it, beyond the Allowed
Overhead, except for payments for materials and consumables that may be
required to conduct the
project.
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7.11
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To
obtain the Committee’s approval for any transfer of controlling interest
in the Incubator. For this purpose “Control” is as defined in the
Securities Law 5722-1968.
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7.12
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To
manage the State Loan to the project in a professional manner, pursuant to
the Provisions. Any outstanding balance of the State Loan that has not yet
been made available to the Project Company and/or Project, for any reason
whatsoever, shall be invested exclusively in interest-bearing bank
deposits or government
securities.
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7.13
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To
use the State Loan for projects exclusively to support projects under the
present agreement.
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7.14
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To
maintain proper audited books of all of the Incubator’s activities, as per
all laws and regulations, and in keeping with Generally Accepted
Accounting Principles, to permit examination by the Chief Scientist or his
representative at any time.
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7.15
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To
submit a report summarizing the activities of the incubator for that
period to the Office of the Chief Scientist, every six months after the
start of the Term of the
Agreement.
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7.16
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To
submit to the Office of the Chief Scientist an annual trial balance for
all of the Incubator’s financial activities, for each six months of
activity. This shall include details of all moneys paid out on account of
the State Loan and all moneys spent by the Incubator, for each six months
of activity.
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7.17
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To
submit to the Office of the Chief Scientist for every calendar year
running from January 1 through December 31st
(hereinafter the “Fiscal Year”), starting on the date of the signing of
this agreement, a financial statement approved by an accountant that
covers all of the Incubator’s financial activities and that includes full
information about all moneys paid out on account of the State Loan to
Projects and all moneys spent by the Incubator, for the entire Fiscal Year
(hereinafter “Yearly Financial Statement”), no later than 90 days after
the end of the Fiscal Year.
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7.18
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To
submit the aforesaid reports and statements, pursuant to the Chief
Scientist’s regulations for financial statements and technical reports, on
the forms that may be specified by the Chief Scientist and as may be
modified from time to time.
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7.19
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To
identify, study, and select appropriate project or projects to be run as
part of the Incubator. The selection of project or projects and their
acceptance for the Incubator shall be at the Incubator’s discretion, in
keeping with the list of criteria for the approval of projects attached to
the present agreement and labeled Appendix
D.
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7.20
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To
help project developers identify, interview, and hire appropriate
researchers for the projects.
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7.21
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To
provide the projects with administrative services, including secretarial
services, maintenance, purchasing, bookkeeping, and computer
infrastructure and services, as required for the efficient and effective
operation of each project, all in keeping with the project agreement and
in keeping with the terms that may be agreed upon between the Incubator
and the Project Company and/or the
Project.
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7.22
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To
provide the Projects with professional assistance and guidance so that
they can carry out their R&D efficiently and
professionally.
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7.23
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For
each Project that has received a Certificate of Approval, to make
available supplemental financial resources, in addition to the State Loan,
as required for carrying out the R&D work on the Projects (the
“Supplementary Financing”).
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7.24
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To
assist the Projects in registering and/organizing as commercial entities,
if necessary, to draw up a business plan, to organize for marketing and
raising capital for the further successful operation of the Project and
its development as a commercial
venture.
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7.25
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To
manage, faithfully and separately for each project, the budget of that
Project, including the State Loan for the Project transferred to the
Incubator for implementation of the
project.
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7.26
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To
conduct an administrative, financial, and professional audit of the
implementation of each project and its progress as per the Project plan,
and to fulfill all of the obligations incumbent on the Incubator under
Certificates of Approval.
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7.27
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Services
supplied to Projects
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7.27.1
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To
provide the Projects with access to consulting and oversight services in
the following domains: bookkeeping and auditing, legal counsel, patents,
quality control, information management, regulatory affairs and clinical
trials, to be provided by service providers who are known to the Committee
and/or substitutes approved by the Committee as being of acceptable scope
and quality.
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7.27.2
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Not to deviate from the Allowed Overhead permitted by the director
general’s Guidelines, with regard to the collection of payments from
Projects in the Incubator for services provided to the Projects by the
Incubator.
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7.28
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That
the signatories below are authorized to bind it with regard to the present
agreement.
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7.29
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Against
the State Loans to be granted to the Incubator on account of the Projects,
the Incubator will record to the benefit of the State a first-degree
floating lien, as in the form attached as Appendix E, on all of the
Incubator’s assets, including restriction of the transfer and/or
registration of rights in the technologies created by the Projects during
the term of the Incubator, and all equipment that may be purchased for use
by the Project. The Incubator shall be required to notify the Incubators
Administration about the assets covered by the aforesaid lien, pursuant to
the procedures of the Technological Innovations Incubator Program of the
Office of the Chief Scientist. To eliminate all doubt, in no case shall
the Incubator and/or Project Company be entitled to sell the equipment
stated in the present section 7.29, or any part thereof, or to transfer it
in any fashion whatsoever to a third party, or to create additional liens
on it, without the written agreement of the State, until it has fully
repaid the State Loans to the State. All revenues from realization of the
lien and/or liens shall be divided pro rata between the State and other
creditors, as per law and
regulations.
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7.30
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That
a Project will remain in the incubator only for the period of its
implementation. The Incubator shall be entitled to appeal to the Committee
and request an extension of the period. The Committee is entitled to
approve the extension of the period at its exclusive discretion, as
stipulated in the director general’s
Guidelines.
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7.31
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Intellectual
Property
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7.31.1
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For
a Type-1 Biotechnology Incubator: That it will not own the intellectual
property associated with the Projects and/or owned by the Project
Companies and/or licensed by them and will have no call or claim on it. A
Type-1 Biotechnology Incubator will guarantee that the intellectual
property is in the exclusive ownership of the Project Company and that the
Project Company and/or those acting on its behalf will not permit any use
and/or transfer of the intellectual property to a third
party.
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7.31.2
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For
a Type-2 Biotechnology Incubator: That the intellectual property will be
in its exclusive ownership and that it and/or anyone acting on its behalf
will not permit the use and/or transfer of the intellectual property to a
third party, except for the Project Company and/or pursuant to the
provisions of section 12 below, and subject to section 7.1 in the director
general’s Guidelines.
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7.31.3
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That
the agreement between the Project Companies and/or Type-2 Biotechnology
Incubator with any third party includes, but not exclusively, university
technology transfer companies and/or research institutes, in everything
associated with the projects:
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7.31.3.1
With
regard to intellectual property that existed prior to the Project, the Incubator
will acquire ownership rights in the intellectual property or the grant of an
exclusive and irrevocable use license from a third party to the Project Company
and/or Type-2 Biotechnology Incubator.
7.31.3.2
The
aforesaid third party shall not be granted any rights in the intellectual
property beyond those already possessed by said third party when the irrevocable
use license was granted or acquisition of ownership rights to the intellectual
property by the Project Company or the Type-2 Biotechnology Incubator and on
account of which the Project Companies or Type-2 Biotechnology Incubator have
received a use license.
7.31.3.3
The
aforesaid notwithstanding, in the case of Projects that have failed or have been
terminated, an aforesaid third party shall be entitled to acquire rights in the
intellectual property associated with the Project and/or created by it, subject
to the Provisions and the approval of the Committee, if it agrees to assume all
of the Incubator’s obligations to the State with regard to the Project, and in
particular section 7.1 of the director general’s
Guidelines.
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7.31.4
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Any
transfer of knowledge to a third party is subject to the director
general’s Guidelines.
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8.
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The
State undertakes to act in accordance with the
Provisions:
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8.1
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To
convey to the Incubator the State Loan for the Project on account of which
the Certificate of Approval was issued, provided that the Incubator meets
its full obligations pursuant to the
Provisions.
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8.2
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To
grant the Incubator a loan to purchase equipment for the central Lab, in
an amount of up to 50% of the cost of the equipment, at the time of the
purchase, with regard to purchases throughout the Term of the Agreement.
The purchase of any item of equipment shall require the approval of
Committee and said item will be covered by the lien on the assets of the
Incubator as stated in section 7.19 above. When it is no longer in use the
relative portion of its depreciated value or its market price on the date
when it ceases to be in use, whichever is less, will be returned to the
State and the lien in favor of the State removed from
it.
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9.
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Shares
of the Incubator Project
Companies:
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The
Incubator
shall be entitled to acquire up to 70% of the share capital of each Project
Company, pursuant to what the provisions of sections 5.11.6 through 5.11.8 of
the director general’s Guidelines.
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10.
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Project
Assets on which the State holds a
lien:
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11.
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As
stated in section 7.29 above, against the State Loans granted to the
Incubator on account of the Projects, the Incubator will record to the
benefit of the State a first-degree floating lien on all assets of the
incubator, including restriction of the transfer and/or registration of
rights in the technologies created by the Projects during the term of the
Incubator, and all equipment that may be purchased for use by the Project.
The Incubator shall be required to notify the Incubators Administration
about the assets covered by the aforesaid lien, pursuant to the procedures
of the Technological Innovations Incubator Program of the Office of the
Chief Scientist. In addition the Incubator undertakes to transfer the lien
to the shares of the Project Companies when they are established, pursuant
to section 5.14.1 of the director general’s Guidelines. For additional
allocations of shares:
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11.1
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The
initial allocation of shares in the Project Company as stated in section 9
above shall be of the same category. Subject to this, it shall be possible
to allocate shares of different categories in the Project
Company.
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11.2
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The
allocation of a category of shares to the Incubator and/or to a party
associated with the Incubator of any type that bears rights other than
those of the encumbered shares shall be possible only in the following
conditions:
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11.2.1
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Should
the said allocation of shares be in the context of the inclusion of the
Incubator and/or some party associated with the Incubator to a third-party
investment in the Project Company, on terms worked out by said third party
and the Project Company in an arms-length agreement, and the Incubator or
party associated with the Incubator makes less than 50% of the investment
in the Project Company in that round of investment, the Incubator will
notify the Committee as to the existence of the agreement within seven (7)
days of the signing of said
agreement.
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11.2.2
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In
any other case, an allocation of shares shall be made only after written
approval has been obtained from the
Committee.
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“Party
associated with the Incubator”: an individual or corporation with a controlling
interest in the Incubator or one in which the Incubator or controlling party in
the Incubator holds more than 25% of its shares, directly or
indirectly.
“Third
party”: A party that neither the Incubator nor a party associated with the
Incubator.
“Control”:
as defined in the Securities Law 5728-1968.
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11.3
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No
additional allocation of shares shall be made other than against cash,
except with the approval of the
Committee.
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12.
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Sales
of encumbered Project assets
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12.1
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The
Incubator shall be entitled to sell encumbered assets of the Project that
are in its possession at any time, at its exclusive discretion, on sole
condition that when encumbered project assets are sold the Incubator makes
use of the proceeds of the sale as
follows:
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12.1.1
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A
Type-1 Biotechnology Incubator and/or its shareholder shall be entitled to
sell their shares in the Project Company, including the encumbered assets
of the Project, at any time and at their exclusive discretion, on
condition that at least 25% of the proceeds of any sale be transferred by
the Incubator and/or its shareholders to the State, against repayment of
the State Loans to the Project, as per section 13
below.
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12.1.2
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A
Type-2 Biotechnology Incubator and/or its shareholders shall be entitled
to sell their shares in the Project Company, including the encumbered
assets of the Project, at any time and at their exclusive discretion, on
condition that at least 25% of the proceeds of any sale be transferred by
the Incubator and/or its shareholders to the State, against repayment of
the State Loans to the Project, as per section 13
below.
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12.1.3
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In
any case of a sale of the technology in full and/or grant of an exclusive
use license in any of the intellectual property assets, the State Loan
given to the Incubator Project shall be repaid in
full.
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12.1.4
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Should
the technology be split up so as to grant more than one use license, an
amount equivalent to 25% of the proceeds for each
license.
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12.2
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In
any case, the total of all moneys transferred to the State on account of
sales as stated in the present section shall not exceed the total of the
State Loan to the Incubator for that Project Company and/or Project, plus
interest and linkage to the Consumer Price Index, as stated in section
13.
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12.3
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For
a Project Company: After full repayment of the balance of the State Loan,
plus interest, the remaining proceeds of the sales of the Incubator’s
shares in that Project Company shall be full owned by the Incubator and
the State shall have no claim or demand on
it.
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For
an
Incubator Project: After full repayment of the balance of the State Loan, as
stipulated in section 13 below, with regard to a particular project, the
encumbered Project assets for that Project will be removed from the lien, in
accordance with the procedures of the Technology Innovation Incubators Program
of the Office of the Chief Scientist, and the State shall have no claim or
demand on them. The State will give its approval in the form attached as
Appendix F.
|
12.4
|
The
grant of an option to acquire the base shares to be transferred by the
Incubator to employees of that Incubator Project shall not be considered
to be a sale for the purposes of the present
section.
|
|
12.5
|
The
lien on encumbered project assets, in whole or in part, shall be removed
immediately after payment to the State in keeping with section 13 below.
If only part of the lien has been removed, the State’s rights to receive
the balance of the proceeds pursuant to this section must be retained,
subject to the Provisions and to section 7.31
above.
|
|
13.
|
Repayment
of the State Loan to the
Project:
|
|
13.1
|
The
Incubator may repay the State Loan to the Project in cash, on the
following terms:
|
|
13.2
|
During
the term of implementation of the Incubator Project, repayment shall be in
exchange for the nominal value of the State Loan, plus
interest.
|
|
13.3
|
During
the first two years after the end of the term of the Incubator Project the
terms of section 13.2 shall remain in force, on condition that the
Incubator undertakes to continue to operate the Project Company and/or the
Project on a similar scale.
|
|
13.4
|
For
the next three years, the terms of section 13.2 shall remain on force, on
condition that the Incubator undertakes to continue to operate the Project
Company and/or the Project on a similar scale, but the interest on the
State Loan in these years shall be
doubled.
|
|
13.5
|
The
state will remove the lien from the encumbered Project assets in an amount
proportional to the fraction of the State Loan that has been repaid. In
addition, the State will remove the lien from the relative part of the
encumbered Project assets in an amount proportional to whatever sums have
not been transferred to the Project and have been returned to the State.
The removal of the lien shall be according to the procedures of the
Technological Innovations Incubator Program of the Office of the Chief
Scientist.
|
|
13.6
|
Should
the Incubator breach its undertakings under the Provisions, or some of
them, and without derogating from other remedies available to the State
under this agreement or by law, the Incubator shall repay to the State,
immediately upon its first demand and no later than 30 days thereafter,
all sums it has received on account of the State Loan for the Projects and
that have not yet been transferred to the Project Company and/or the
Project and/or moneys that have been transferred to the Project Company
and/or the Project that deviate from the terms of the Certificate of
Approval, plus linkage differentials and interest, in the meaning of the
Award of Interest and Linkage Law
5721-1961.
|
|
13.7
|
If
the Incubator received a State Loan for Projects, but a liquidation order
or bankruptcy order has been issued against it, or it has decided on its
voluntary liquidation, before all of its obligation under the present
agreement and/or the directives and/or the Certificate of Approval and/or
the statement of commitment have been fulfilled, it will be considered as
if it had undertaken to pay back the State Loan, including everything
purchased using the moneys of said State Loan, before the liquidation
order or bankruptcy order was issued or before the decision was
taken.
|
|
14.
|
Realization
of liens
|
The State
will be entitled to realize its liens on encumbered project assets to repay the
balance of the State Loan for that Project:
|
14.1.1
|
At
the expiration of 8 years from the issuance of the Certificate of Approval
for that Project, and after 30 days have lapsed from notification to the
Incubator of its intention to do so;
or
|
|
14.1.2
|
At
any earlier date should an order of liquidation or order of bankruptcy be
issued against the Incubator or Project Company or should the latter
decide on voluntary liquidation;
or
|
|
14.1.3
|
Should
the incubator breach its undertakings pursuant to the present agreement
and/or the Provisions and/or the Certificate of Approval regarding that
project, in some fundamental
breach.
|
|
15.
|
The
incubator shall not be entitled to transfer any rights or obligations
under the present agreement to another
party.
|
|
15.1
|
The
aforesaid in section 15 notwithstanding, the Incubator shall be entitled
to transfer and/or to assign its right to repayment of the State Loan to
any third party, as stated in section 13 above. However, nothing in this
shall be deemed to release the Incubator from any of its obligations under
the present agreement. The Incubator undertakes to notify the State in
writing immediately upon any assignment or transfer as
stated.
|
|
15.2
|
The
agreement by any parties to deviate from any conditions whatsoever of the
present agreement, in a specific case or in a series of cases, shall not
serve as a precedent and nothing shall be inferred from it for any other
cases in the future.
|
|
15.3
|
Should
either of the parties fail to enforce or enforce tardily any right
whatsoever granted it pursuant to the present agreement under law, in any
case or in a series of cases, this shall not be seen as a waiver of said
right or of any other rights
whatsoever.
|
|
16.
|
Any
notice or warning related to any matter that derives from the present
agreement shall be sent by one party to the other by registered mail, to
the addresses indicated below, and will be considered to have been
received by the addressee within 72 hours of the posting of the letter
that includes the notice or
warning.
|
The
State: Incubators Administration, Office of the Chief Scientist, Ministry of
Industry and Trade, POB 50031, 61500 Tel Aviv
The
incubator:
|
17.
|
All
of the conditions of sections 4, 6, 7, 10, 11, and 12, are fundamental
conditions. The breach of any one or more of them is fundamental breach
under the Law of Contracts (Remedies for Breach of Contracts) 5731-1970.
The present section is to be amended in accordance with the final
draft.
|
|
18.
|
The
incubator will have the present agreement stamped and will be responsible
for the stamp tax.
|
In
witness whereof the parties have affixed their signatures on the date stated at
the beginning of this agreement.
The
State:
<rubber
stamp and signature> Xxxxxx Xxxxx, director general
<Signature>
The Chief
Scientist
<Signature>
the
Controller
Rubber
stamp: BioLine Innovations Jerusalem Limited Partnership By its General Partner,
BioLine Innovations Jerusalem Ltd.
/s/
Xxxxxx Xxxxxx
Name of
signatory: Xxxxxx Xxxxxx
Rubber
stamp: BioLine Innovations Jerusalem Limited Partnership By its General Partner,
BioLine Innovations Jerusalem Ltd.
/s/ Xxxx
Xxxxxxx
Name of
signatory: Xxxx Xxxxxxx
Version:
January 26, 2005
Xxxxx
Xxxxx and Co., Advocates and Notary
Jerusalem,
January 16, 2005
Ref.
9218
To:
Ms. Xxxx
Xxxxxx
Technological
Incubators Administration
Hamered
29, Tel Aviv
Dear
Xxxxx,
Re:
Confirmation of Authorized Signatories, BioLine Innovations Jerusalem, Limited
Partnership
As the
attorneys of BioLine Innovations Jerusalem Limited Partnership (hereinafter “the
Incubator”), I hereby affirm that, in keeping with the limited partnership
agreement of the Incubator, dated December 23, 2004, the general partner of the
Incubator is BioLine Innovations Jerusalem, Ltd. (hereinafter: “the General
Partner”). In its capacity as general partner the General Partner will be
exclusively responsible for managing all affairs of the Incubator, including
that the signature of the General Partner shall bind the Incubator in every
matter.
I hereby
confirm that Xxxxxx Xxxxxx and Xxxx Xxxxxxx have been authorized by the General
Partner to sign the agreement for the operation of a biotechnological incubator
by and between the Incubator and the Government of Israel on behalf of the State
of Israel, represented by the Chief Scientist and the Controller of the Ministry
of Industry, Trade, and Employment. The signature of each of these parties,
whether Xxxxxx Xxxxxx or Xxxx Xxxxxxx, on this agreement, without need for the
company’s seal or the printed name of the General Partner, binds the General
Partner and thereby also binds the incubator in every matter. In addition I
hereby verify the signatures of Xxxxxx Xxxxxx and Xxxx Xxxxxxx as
follows:
|
Name
|
ID number
|
Signature
|
|||
|
Xxxxxx
Xxxxxx
|
069455137
|
/s/
Xxxxxx Xxxxxx
|
|||
|
Xxxx
Xxxxxxx
|
321101347
|
/s/
Xxxx
Xxxxxxx
|
Sincerely
yours,
/s/ Xxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxxxx, attorney-at-law
Appendix
A: Operating Plan
Office
of the Chief Scientist, Technological Incubators Administration
Approved
Chief Scientist Budget for an Incubator as a Pilot
Name of
incubator: BioLine Innovations Jerusalem Date:
Name of
incubator corporation: File No.: 35583
Implementation
period (for six years): From Jan. 1, 2005 to Dec. 31, 2010–04–22
|
A
|
Personnel costs
|
Total
cost,
first
year
|
Total
cost,
2nd
year
|
Total
cost,
3rd
year
|
Total
cost,
4th
year
|
Total
cost,
5th
year
|
Total
cost,
6th
year
|
Total
Budget
for 6
years
|
|||||||||||||||||||||||||||||
|
Surname
|
Given
name
|
Position
|
NIS
per month
|
FTE
(%)
|
Months
employed (1st year)
|
Months
employed (2nd year)
|
Months
employed (3rd year)
|
Months
employed (4th year)
|
Months
employed (5th year)
|
Months
employed
(6th
year)
|
|||||||||||||||||||||||||||
|
1
|
Xxxxxxxx
|
Xxxxxxxx
|
CEO
|
100%
|
12
|
12
|
12
|
12
|
12
|
12
|
|||||||||||||||||||||||||||
|
2
|
Xxx
|
Xxxxxx
|
VP
|
100%
|
12
|
12
|
12
|
12
|
12
|
12
|
|||||||||||||||||||||||||||
|
3
|
Xxxxxx
|
Xxxx
|
VP
|
100%
|
12
|
12
|
12
|
12
|
12
|
12
|
|||||||||||||||||||||||||||
|
4
|
To
be determined
|
100%
|
12
|
12
|
12
|
12
|
12
|
||||||||||||||||||||||||||||||
|
5
|
Xxxxxxxx
|
Xxxx
|
Lab
director
|
100%
|
12
|
12
|
12
|
12
|
12
|
12
|
|||||||||||||||||||||||||||
|
6
|
Xxxxx
|
Xxxx
|
Adm.
Director
|
100%
|
12
|
12
|
12
|
12
|
12
|
12
|
|||||||||||||||||||||||||||
|
7
|
Xxxxx
|
Xxxxxx
|
Secretary
|
100%
|
12
|
12
|
12
|
12
|
12
|
12
|
|||||||||||||||||||||||||||
|
8
|
|||||||||||||||||||||||||||||||||||||
|
9
|
|||||||||||||||||||||||||||||||||||||
|
Reserve
for inflation
|
3%
|
||||||||||||||||||||||||||||||||||||
|
B
|
Subcontractors:
Company and service
|
Total
Personnel
|
|||||||||||||||||||||||||||||||||||
|
1
|
Payments
to members of advisory scientific council
|
|
2
|
Legal
counsel
|
||||||||||||||||||||||||||||||||||||
|
3
|
PR
|
||||||||||||||||||||||||||||||||||||
|
4
|
Regulatory
counsel
|
||||||||||||||||||||||||||||||||||||
|
5
|
Payments
to medical experts
|
||||||||||||||||||||||||||||||||||||
|
6
|
Bookkeeping
and accountant
|
||||||||||||||||||||||||||||||||||||
|
7
|
Intellectual
property counsel
|
||||||||||||||||||||||||||||||||||||
|
8
|
Program
support
|
||||||||||||||||||||||||||||||||||||
|
C
|
Equipment
– Item/Type
|
Total
Services
|
|||||||||||||||||||||||||||||||||||
|
1
|
Office
equipment
|
||||||||||||||||||||||||||||||||||||
|
2
|
Computer
and network
|
||||||||||||||||||||||||||||||||||||
|
3
|
Software
|
||||||||||||||||||||||||||||||||||||
|
4
|
Setting
up central lab
|
||||||||||||||||||||||||||||||||||||
|
5
|
Setting
up offices
|
||||||||||||||||||||||||||||||||||||
|
6
|
Office
furniture
|
||||||||||||||||||||||||||||||||||||
|
D
|
Miscellaneous
|
Total
equipment
|
|||||||||||||||||||||||||||||||||||
|
1
|
Rent
and upkeep
|
||||||||||||||||||||||||||||||||||||
|
2
|
Municipal
services
|
||||||||||||||||||||||||||||||||||||
|
3
|
Communications
|
||||||||||||||||||||||||||||||||||||
|
4
|
Vehicles
for executives
|
||||||||||||||||||||||||||||||||||||
|
5
|
Upkeep
of central lab
|
||||||||||||||||||||||||||||||||||||
|
6
|
Subscriptions
to journals and databases
|
||||||||||||||||||||||||||||||||||||
|
E
|
Marketing
|
Total
miscellaneous
|
|
1
|
Attendance
at conferences
|
||||||||||||||||||||||||||||||||||||
|
2
|
Sponsorship
of conferences
|
||||||||||||||||||||||||||||||||||||
|
3
|
Travel
|
||||||||||||||||||||||||||||||||||||
|
4
|
Producing
marketing materials
|
||||||||||||||||||||||||||||||||||||
|
Total
marketing
|
|||||||||||||||||||||||||||||||||||||
|
Signatures
|
Total
Budget
|
||||||||||||||||||||||||||||||||||||
|
<rubber
stamp>
|
Total
grant to set up lab
|
||||||||||||||||||||||||||||||||||||
|
(illegible)
Incubator
director
|
???
less grant to set up lab
|
Appendix
B: Incorporation
Data of the Company:
BioLine
Innovations Jerusalem is a limited partnership, fully controlled (100%) by
BioLineRx Ltd. The general partner is BioLine Innovations Jerusalem, a limited
corporation established by BioLineRx Ltd. The limited partner is BioLineRx
Ltd.
Data
of the shareholders in the Incubator (clause 6.1)
Below is
a list of the shareholders in BioLineRx Ltd.:
|
Shareholder’s
name
|
Place of
incorporation/
citizenship
|
Address
|
Number of shares
|
Percent of
holdings
|
||||||||
|
Teva
Pharmaceutical
Industries
|
Israel
|
P.O.
Box 0000, 0 Xxxxx Xx., Xxxxxx Xxxxx
|
3,000,000 | 18.83 | % | |||||||
|
Giza
Venture Capital
|
Israel
|
00
Xxxxxxxx Xx., Xxxxx Xxxx Tower, P.O. Box 17672, Tel Aviv
|
3,000,000 | 18.83 | % | |||||||
|
Pitango
Venture Capital
|
Israel
|
11
HaMenofim St., Herzliyya Pituach
|
3,000,000 | 18.83 | % | |||||||
|
Hadasit
Ltd.
|
Israel
|
P.O.
Box 121000, Hadassah Ein Kerem, Jerusalem
|
2,000,000 | 12.55 | % | |||||||
|
STAR
Ventures
|
Israel/Germany
|
11
Galgalei HaPlada, 3rd floor, Herzliyya Pituach
|
1,500,000 | 9.41 | % | |||||||
|
Xxxxxx
Xxxxxxx
|
Israel
|
00
Xxxxx Xxxxxxxxxx Xx., xxxxxxxx X, Tel Aviv
|
750,000 | 4.71 | % | |||||||
|
Jerusalem
Development Authority
|
Israel
|
Municipal
Compound, 2 Safra Square, P.O. Box 32226, Jerusalem
|
400,000 | 2.51 | % | |||||||
|
Options
and shares to be distributed to employees
|
2,285,024 | 14.34 | % | |||||||||
Appendix
C: Bank Guarntee
Bank
Guarantee
055892
Guarantee
No.
741-097800/55-30–0841-0002/4
Date:
Oct. 20, 2004
To: State
of Israel
via the
Office of the Chief Scientist
Ministry
of Industry and Trade
Dear Xxx
or Madame
|
1.
|
With
regard to the agreement between the State of Israel and BioLine Rx, Ltd.
(hereinafter “the Guaranteed”) (hereinafter “the Agreement”) and pursuant
to Guideline No. 8.4 (Technological Innovation Centers—Biotechnology
Incubators) issued by the director general of the Ministry of Industry and
Trade, and at the request of the Guaranteed, we hereby guarantee to you
payment of any sum, up to the “Amount of the Guarantee” (as defined
below), relevant at the date of your demand, on condition that the total
amount of all payments made to you under the present guarantee not exceed
the Amount of the Guarantee as at the relevant
date.
|
The
“Amount of the Guarantee” means the sum of NIS 8,100,0900.00 (eight million one
hundred thousand sheqels) only; but at any time that we receive notification
from you that the Incubator has made an approved outlay of at least
NIS 500,000 (“Approved Outlay”), as at the date of the submission of said
notification to us, the Amount of the Guarantee will be reduced by half the
amount of the Approved Outlay. Notwithstanding, the Amount of the Guarantee will
not be reduced, at any time or in any circumstances, to less than
NIS 1,500,000 (one million and a half).
The
Amount of the Guarantee will be linked to the Consumer Price Index as published
form time to time by the Central Bureau of Statistics and Economic Research,
with the following linkage terms:
“The Base
Index” for the purposes of the present guarantee will be the index for September
2004 published on or around the fifteenth of the following month, which is 100.6
points (based on 2002).
“The New
Index” for the purpose of the present guarantee will be the most recently
published index before receipt of your demand for payment under this
guarantee.
Linkage
differentials for the present guarantee will be calculated as follows: If the
new index is higher than the base index, the linkage differential will be a sum
equal to the ratio of the new index to the base index times the Amount of the
Guarantee, divided by the base index. If the new index is lower than the base
index, we will pay you the sum stated in your demand, up to the Amount of the
Guarantee, with no linkage differentials.
|
2.
|
The
Amount of the Guarantee will be paid to you within 10 days of our receipt
of your first demand in writing, and you shall be under no obligation to
prove your demands, nor shall we assert against you any defense that might
be available to the party requesting this guarantee with regard to the
debt to you and without your being required to first demand request the
Amount of the Guarantee from the
Guaranteed.
|
|
3.
|
This
guarantee will remain in force until Dec. 31, 2004. After that time it
will be null and void.
|
|
4.
|
Any
demand pursuant to the guarantee must be submitted to us at the following
address: Xxxxxx Xxxxxxxx 00,
Xxxxxxxxx.
|
|
5.
|
This
guarantee cannot be transferred or
assigned.
|
Sincerely
yours,
Bank
Leumi xx’Xxxxxxx
Givat
Xxxxx Xxxxxx
<rubber
stamp + /s/ Xxxxxx Xxxxxx> Xxxxxx Xxxxxx 3123
<rubber
stamp + /s/ X. Xxxxx > X. Xxxxx 2732
Bank
Guarantee
089947
Date:
Dec. 16, 2004
Guarantee
No. 741-097800/55-30–0841-0002/4
To: State
of Israel via the Office of the Chief Scientist
Ministry
of Industry and Trade
Our
guarantee to your credit, No. 741-097800/55-30–0841-0002/4
Date:
Oct. 20, 2004
In the
amount of 8,100,000.00 (eight million one hundred thousand new sheqels
only)
For:
BioLine Rx Ltd.
Valid
through Dec. 31, 2004
We hereby
extend the validity of the above guarantee until March 31, 2011.
Consequently,
any demand pursuant to said guarantee must reach the undersigned branch, whose
address is Jerusalem, Kanfei Nesharim 22, Givat Xxxxx, by said date, during the
hours when the branch is open to the public for business.
A demand
that arrives after said time will not be honored.
It is
emphasized that a “written demand” as stated above does not include a demand
sent to the bank by facsimile, telegram, or any other electronic medium and that
such will not be considered to be a demand for the purposes of the present
guarantee.
There are
no changes to any other terms of the guarantee.
Sincerely
yours,
Bank
Leumi xx’Xxxxxxx
Givat
Xxxxx Xxxxxx
<rubber
stamp + /s/ Xxxxxx Xxx-Xxx> Xxxxxx Xxx-Xxx 5835
<rubber
stamp + /s/ X. Xxxxx> X. Xxxxx 2732
Appendix
D: List of criteria for choosing projects
|
1.
|
The
project is for the development or improvement of a product or process
which is intended for the global biotechnology
market.
|
|
2.
|
The
product or process is technologically
innovative.
|
|
3.
|
A
technical-economic and marketing examination has been performed and it
shows that success is reasonably
probable.
|
|
4.
|
The
duration of the project up until it is ready for the entry of an
industrial partner or for raising capital for continued development and
commercialization shall be up to three
years.
|
|
5.
|
All
the of the project’s budget finance sources have been settled and there
are no other governmental source of development financing for the project
and/or incubator other than the state
loan.
|
|
6.
|
The
project has passed an initial feasibility test as part of the academic
research or in any other framework. Initial feasibility testing will not
be done as part of this program.
|
|
7.
|
According
to an examination, the project has the potential to achieve high returns.
The maturity period for the project is long (approx. 10 years from the
beginning of development until it reaches the market). The project is
capable of raising external capital within 3 years. The technological risk
of the project is high and the lion’s share of the research and
development shall be done as part of and in the framework of the
incubator.
|
Appendix
E: Bond for a type 2 biotechnological incubator
Issued on
the _______ day of the month of _________ in the year _______ by
________________________
(hereinafter
“the Incubator”)
with the
State of Israel (hereinafter “the State”) as the beneficiary
|
Whereas
|
to
ensure the repayment of all sums that the Incubator owes and/or from time
to time may owe the State for the State’s loans to the Incubator to enable
the execution of Incubator projects, and to ensure that the Incubator
fulfills in full and on time its obligations to the State according to the
agreement whereby it shall operate an industrial research and development
entrepreneurial center under incubator conditions, an agreement between
the Incubator and the State that was drawn up and signed on (date)
_____________ (hereinafter “the Agreement”), the
Incubator hereby encumbers and mortgages all its assets through this bond,
in a senior floating lien with the State as a beneficiary, and hereby
assigns all its assets to the State through a floating
lien.
|
|
Whereas
|
according
to provision no. 8.4 of the director general of the Ministry of Industry
and Trade issued on May 2, 2004 (hereinafter "the Director General's
Provision") and
according to the agreement the Incubator is and/or will be eligible to
receive a loan (hereinafter "the Loan") from the
State for a Project company and/or a project, as defined in the agreement,
for purposes of executing the Project, as specified by law and as
specified in the Director General’s
provisions;
|
|
And
whereas
|
the
State has approved the Incubator’s request for funding, in keeping with
the certificate of approval, as defined below, and in keeping with the
agreement;
|
|
And
whereas
|
as
a condition of receiving the loan, the Incubator committed itself to
encumbering the encumbered assets of the Project, as defined in clause
5.14 of the Director General’s Provision, with the State as the
beneficiary;
|
It is
accordingly stipulated in the bond as follows:
|
1.
|
The
preamble to this bond (hereinafter "the Bond" or "the Certificate of
Encumbrance") and the accompanying appendices are inseparable parts
of the Bond.
|
|
2.
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In
this Certificate of Encumbrance the following terms shall have the
following meanings:
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2.1
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Approved
plan: The plan with all its conditions as it was approved by the
Committee on Biotechnological Incubators (hereinafter: “the Committee”) and for
whose execution the Incubator has received and/or is eligible to receive a
loan pursuant to the agreement.
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2.2
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Certificate
of Approval: A certificate to be signed by the Chief Scientist, for
the purpose of funding an Incubator Project as defined in the
agreement.
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2.3
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Project:
as defined in the agreement.
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3.
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In
every instance in which there is a contradiction between the provisions of
this Bond and the provisions of the Agreement, the provisions of the Bond
will override those of the Agreement. Notwithstanding, it is stipulated
that the realization of the Bond and lifting of the lien on the assets
will be subject to the provisions of the
Agreement.
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4.
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The
section headings in this Bond are meant exclusively for ease of reading
and are not to be used in its
interpretation.
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5.
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This
Certificate of Encumbrance guarantees and shall guarantee the full and
exact repayment of all sums of the loan and other sums that the Incubator
is to repay to the State and, without derogating from the generality
thereof, principal, interest, linkage differentials, guarantees, fees,
expenses, realization expenses, legal expenses, and so
forth.
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6.
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As
collateral for the full and exact repayment of all the guaranteed sums and
by virtue of clauses 165–166 of the Companies Ordinance of 1983 (new
version), and/or by virtue of any other legal provision the Incubator
hereby encumbers the Incubator’s assets with a senior floating lien. The
lien applies to the Incubator’s assets in both their current and any
future states, including a restriction on the transfer and/or licensing of
the rights to the technologies that were produced by the projects during
their period in the Incubator; the lien also applies to any equipment that
is purchased for use by the Project (hereinafter “the Encumbered
Property”).
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7.
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The
Incubator hereby declares and confirms that there are no other attachments
or liens or encumbrances or mortgages on the Encumbered Property or any
part of it, or any undertaking to create any such lien or encumbrance or
mortgage.
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8.
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The
Incubator hereby undertakes to ensure that the lien it has created through
this Certificate of Encumbrance shall be recorded in the Register of Liens
of the Registrar of Companies and/or the Registrar of Liens and/or in any
other relevant register (hereinafter: “the Registrar”) within
the legal time frame. The Incubator also agrees to sign at the State’s
request any document, letter, request, or similar document addressed to
any agency for purposes of registering the lien in any
register.
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9.
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The
Incubator agrees that the lien that is registered by the Registrar in the
Register of Liens as stated above shall not be removed from the said
Register of Liens until such time as the State provides it with a written
declaration to the effect that it agrees to remove the
lien.
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10.
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The
State shall be entitled to realize the lien, with itself as the
beneficiary, without any need for the Incubator’s consent. The State shall
inform the Incubator of its intent to realize the lien thirty (30) days
before doing so.
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11.
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The
Incubator undertakes to do the
following:
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11.1
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To
insure the physical Encumbered Property beginning from the date this bond
is signed and at all times at its full value as is the practice with
physical property, against all risks for which similar physical assets are
insured, with an insurance company registered in Israel that is legally
authorized to sell insurance. The Incubator also undertakes to inform the
said insurance company of any notice or instruction regarding the
assignment of the rights accruing to the State from the insurance policies
of which the State is the beneficiary, according to a formulation that is
approved by the State. This formulation shall include among other
provisions an irrevocable order to the said insurance company to pay all
sums that the Incubator is or shall be entitled to collect on account of
all or any part of the encumbered property exclusively to the State and/or
to the State’s designated recipient. In addition, the Incubator undertakes
to submit to the State confirmation from the said insurance company that
it has received the above-mentioned order and that it agrees to abide by
it, and that it also undertakes to give the State notice by registered
mail about any change or cancellation or expiration of any insurance
policy at least thirty (30) days in advance. The Incubator undertakes not
to introduce changes into any of its insurance policies without the
State’s approval. The Incubator also undertakes to extend the validity of
its insurance policies from time to time as necessary throughout the
period of the lien, even without any request or demand from the
State.
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11.2
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To
fulfill all the conditions of the insurance policies mentioned in clause
11.1 above and to comply with all their restrictions, and to submit copies
of all the aforesaid policies to the State. In the event that the State
asks the Incubator to introduce any revisions into the insurance policies
the Incubator undertakes to make these
revisions.
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11.3
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To
preserve the physical Encumbered Property and to maintain it in good
working condition, to use it carefully, and to inform the State
immediately of any instance of substantive damage to and/or substantive
malfunction of and/or substantive defect in the property, and to
immediately repair any damage to and/or malfunction of and/or defect that
occurs in the Encumbered Property for any reason, and to enable the
State’s or the Committee’s representatives to check the condition of the
Encumbered Property at any time.
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11.4
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Not
to remove the physical Encumbered Property or any part of it from the
premises of the Incubator building without the State’s written agreement
in advance, with the exception of the temporary removal of the Encumbered
Property for the exclusive purpose of repairing
it.
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11.5
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Not
to sell, rent, give, transfer, and/or assign all or any part of the
Encumbered Property to any third party whatsoever without receiving prior
written consent from the State or pursuant to the provisions of the
Agreement.
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11.6
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To
immediately inform the State of the imposition of any attachment, the
implementation of any action, the execution of any judgment, or the
submission of a request for the appointment of a receiver for all or part
of the Encumbered Property, and also to immediately notify any agency
and/or third party that has imposed any such attachment or taken any such
action. In addition, the Incubator undertakes to immediately perform at
its own expense any action that may be required to rescind the attachment
and/or revoke and/or cancel the action, as
relevant.
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11.7
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The
Incubator undertakes not to mortgage and/or encumber all or any part of
the Encumbered Property to any third party with any other or additional
lien and/or mortgage, whether prior, equal, subsequent, or junior, or any
other encumbrance without receiving prior written permission from the
State.
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12.
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After
the full balance of the State loan for a certain project has been repaid
(as specified in clause 13 of the agreement), those assets of the Project
that were encumbered with regard to the said project shall be removed from
the scope of the lien, pursuant to clause 12.3 of the Agreement. The State
undertakes to deduct the sum that corresponds to the lien from the
relative portion of the State loan, in keeping with the procedures of the
technological incubators program of the Chief Scientist’s Office. In
addition, the State shall deduct the sum that corresponds to the lien from
the relative portion of the State loan that corresponds to the encumbered
assets, in proportion to the sums that were not transferred to the Project
and were returned to the State, or that were not transferred to projects
that were shut down and/or that failed, in keeping with the procedures of
the technological incubators program of the Chief Scientist’s
Office.
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13.
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The
Incubator hereby grants the State irrevocable power of attorney to carry
out in its name, on its behalf, and at its expense any of the following
activities: to file any suit against the insurance companies with regard
to the insurance of all or part of the physical Encumbered Property, and
to reach agreement with the insurance companies regarding the suits
against them as the State sees fit, after notifying the Incubator,
including agreements that constitute a compromise on or waiver of the
Incubator’s rights, all or in part, and to sign an arbitration agreement
and collect the insurance monies. The State shall have the right to
undertake any of the aforementioned actions whether the insurance policy
was/will be taken out by the Incubator or in its name or whether it
was/will be taken out by the
State.
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14.
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This
lien shall in no way detract from any of the State’s rights to collect the
guaranteed sums, in whole or in part, in ways other than by realizing its
rights according to this Bond, and the realization of the State’s rights
according to this Bond shall in no way detract from the State’s right to
collect from the Incubator the balance of the guaranteed sums that were
not repaid by realization of the lien that is the subject of this
bond.
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15.
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The
State shall be entitled to appoint a receiver and/or a liquidator and/or a
special director and/or a trustee (“the Receiver”) for
purposes of realizing the lien at its absolute and exclusive discretion,
after it has given the Incubator prior warning of 30 days. In addition, if
so requested the Incubator shall approve the fact of the appointment
and/or the identity of the State’s choice of
appointees.
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16.
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No
waiver, discount, failure to take timely action, or extension granted by
the State or on its behalf shall be considered a waiver of any sort of the
State’s rights under this Certificate of Encumbrance, and shall in no way
impede the State or its representatives from filing suit or undertaking
any other procedure. Any concession by the State regarding any previous
breach by the Incubator or previous failure to fulfill one or more of its
obligations under this Bond and/or under the Agreement shall not be
considered to justify some other breach and shall not constitute a
precedent and/or leave for the Incubator to commit another
breach.
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17.
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The
books and accounts of the State and/or the Committee or the books and
accounts of an organization or organizations that the State designates to
pay out the loan (all or in part) to the Incubator shall be considered
trustworthy by the Incubator and shall serve at any time as prima facie
evidence against it with regard to sums the Incubator must repay and/or
pay the State.
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18.
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In
order to remove all doubt, the Incubator hereby declares and confirms that
none of the provisions of this Certificate of Encumbrance in any way
detracts from any of the Incubator’s obligations under the law or under
any regulation that has been issued or rule that has been instituted in
accordance with the law or according to any agreement that was made and/or
shall be made between the State and the Incubator and/or according to any
document that was and/or shall be signed by the Incubator with the State
as the beneficiary.
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19.
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The
Incubator’s address for the purposes of this Certificate of Encumbrance is
the address of its office listed
above.
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20.
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All
of the expenses involved in drawing up, signing, implementing, and
realizing this Certificate of Encumbrance and everything connected with it
shall be paid by the Incubator to the State at its first request, with
interest.
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21.
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The
legal jurisdiction for this bond is hereby declared to be the competent
court in the Jerusalem district; but the State shall be entitled to take
legal action against the Incubator on all matters that pertain to this
Certificate of Encumbrance in any other competent court as
well.
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22.
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No
revision and/or update of any of the provisions of this bond shall be
valid unless it is executed in writing and signed by both
sides.
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In
witness whereof we hereby affix our signatures:
The Incubator:
___________________
By the
authorized signatories:
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Name
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Identity
card no.
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Position
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1.
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2.
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Appendix
F: Format for confirmation/release of the Project [by the State of
Israel]
Date:_________
To: BioLine Innovations
Jerusalem Limited Partnership
Dear Sir
or Madam:
Re: Confirmation of
repayment of the State loan for the “_____________________”
project
In
keeping with clause 12.3 of the agreement signed between us on _____________
(hereinafter: “the Incubator
Agreement”), we hereby confirm as follows:
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1.
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The
full amount of the State loan that was extended to you in connection with
the project at issue (hereinafter: “the Project”) has been
repaid in keeping with the conditions of the Incubator
agreement.
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2.
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Any
lien that was placed with us as a beneficiary with regard to the Incubator
agreement shall no longer apply to the Project and all the assets and
rights connected with it.
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3.
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As
of the date of this letter, there shall no longer be any
limitation—according to the Incubator Agreement and/or any lien that was
placed with us as a beneficiary—on the Project and its assets and their
transfer, sale, licensing and so forth, all subject to the restrictions
that apply according to the Research and Development Law and subject to
clause 7.1 of the director general’s
provisions.
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Respectfully
yours,
Director
of the Incubators Project
Office of
the Chief Scientist
The State
of Israel
