Exhibit 10.5
EMPLOYMENT AGREEMENT
     This EMPLOYMENT AGREEMENT (this “Agreement”) is made effective as of
October 15, 2006 (the “Effective Date”), by and between Protalix Ltd., a company
organized under the laws of the State of Israel (the “Company”) and Yossef
Maimon, Israel Identification No. 24821233 (the “Employee”) (each of the Company
and Employee shall be referred to herein, as a “Party” and collectively, the
“Parties”).

WHEREAS,   the Company is engaged, inter alia, in the research and development
of proteins and expression thereof in plant cells cultures; and

WHEREAS,   the Company desires to employ the Employee in the position of
Company’s Chief Financial Officer (“CFO”) and the Employee desires to be
employed by the Company in such position, on the terms and conditions
hereinafter set forth;

NOW, THEREFORE, based on the representations contained herein and in
consideration of the mutual promises and covenants set forth herein, the Parties
agree as follows:

1.   Employment.   1.1.   Commencing as of the Effective Date, the Company shall
employ the Employee in the position of CFO, reporting to the Chief Executive
Officer of the Company (“CEO”).   1.2.   The Employee’s duties and
responsibilities shall be those duties and responsibilities customarily
performed by a Chief Financial Officer of a company, as may be determined from
time to time by the CEO. These will include, inter alia, the following:

General -

  •   Supervision of recording of transactions and balances     •   Supervision
of administrative accounting staff     •   Management of tax and related
payments     •   Banking relations

Systems and policies –

  •   Ensuring overall integrity of accounting systems     •   Ensuring that
applicable data is standardized and systems are well structured for proper and
easily accessible reporting     •   Acting as Chief Accounting Officer (CAO) to
determine accounting policies and assist others in accounting related matters  
  •   Working with others in the company to determine financial policies and
reporting practices     •   Identifying emerging tax and reporting issues and
coordinating policies with outside accountants and lawyers     •  
Implementation of internal control procedures

Internal reporting -

  •   Preparing cash flow projections     •   Preparing monthly financial
summaries and key performance indicators     •   Preparing and implementing
budget and financial portion of business plan

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External Reporting

  •   Preparing quarterly and annual financial statements, notes and related
information, and any other information as may be required according to US GAAP,
tax, securities and other applicable statutes and regulations, SEC reports, etc.
    •   Working with public and private investors to explain financial
information and verify integrity of systems.

1.3.   The Employee shall be employed on a full-time basis. The Employee shall
devote his full and undivided attention and full working time to the business
and affairs of the Company and the fulfillment of his duties and
responsibilities under this Agreement, it being agreed that during the period
from the Effective Date until the end of calendar year 2006 (the “Assistance
Period”) Employee shall be entitled to assist his immediately prior employer in
the integration into such employer’s organization of the person who will assume
the Employee’s position therein, provided however that (i) such assistance is
given up to a limited amount of hours per month during the Assistance Period,
(ii) the provision of such assistance is coordinated promptly in advance with
the CEO, and (iii) is the provision of such assistance does not derogate from
any of Employee’s obligations hereunder or the performance of any of its duties
or responsibilities hereunder.       Without derogating from the generality of
the above, during the term of this Agreement the Employee shall not be engaged
in any other employment nor engage in any other business activity or render any
services, with or without compensation, for any other person or entity.      
The Employee shall notify the Company immediately of any event or circumstance
which may hinder the performance of his obligations hereunder or result in the
Employee having a conflict of interest with his position with the Company.  
1.4.   The Employee acknowledges that the Company’s facilities are located in
Carmiel and that he will be required to attend such facilities at least three
(3) working days per week, unless coordinated otherwise with the CEO. Employee
further acknowledges and agrees that the performance of his duties hereunder may
require significant domestic and international travel at the Company’s request.
  1.5.   It is agreed between the Parties that the position that Employee holds
within the Company is a management position, which demands a special level of
loyalty and accordingly the Work Hours and Rest Law (1951) shall not apply to
Employee’s employment by the Company and this Agreement. The Employee further
acknowledges and agrees that his duties and responsibilities may entail
irregular work hours and extensive traveling in Israel and abroad, for which he
is adequately rewarded by the compensations provided for in this Agreement. The
Parties confirm that this is a personal services contract and that the
relationship between the Parties shall not be subject to any general or special
collective bargaining agreement or any custom or practice of the Company in
respect of any of its other employees or contractors.   2.   Salary and Employee
Benefits.

In full consideration of Employee’s employment with the Company, commencing as
of the Effective Date, the Employee shall be entitled to the following payments
and benefits, it being understood and agreed that any Salary-based benefits
shall be calculated exclusively on the basis of the base Salary (without
consideration to any other benefit):

2.1.   Salary. The Company shall pay the Employee a gross salary of NIS 45,000
per month (the “Salary”). The Salary will be adjusted from time to time in
accordance with the

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    Cost of Living Index (“Tosefet Yoker”) as may be required by law. The Salary
shall be payable monthly in arrears, and shall be paid to the Employee in
accordance with Company’s policy.   2.2.   Bonuses.       2.2.1 Annual Bonus.  
    At the end of each calendar year, the Company shall consider granting the
Employee an annual bonus, at the Company’s sole discretion and without any
obligation on Company’s part to grant such bonus. Without limiting such
Company’s sole discretion, Employee’s skills, performance of, and dedication to,
his duties hereunder shall serve as a factor in Company’s determination as
aforesaid.       2.2.2 Bonus upon Achievement of Significant Milestones.      
The Company shall consider granting the Employee a bonus upon achievement of a
significant milestone by the Company, at the Company’s sole discretion and
without any obligation on Company’s part to grant such bonus. Without limiting
such Company’s sole discretion, Employee’s contribution to the achievement of
such a significant milestone shall serve as a key factor in Company’s
determination as aforesaid.   2.3.   Options. Employee shall be entitled to an
option (the “Option”) to purchase 9,300 Ordinary Shares of the Company
(“Ordinary Shares”) under the Company’s 2003 Israeli Stock Option Plan, subject
to the approval of the Board of Directors of the Company (the “Board”) and the
following additional terms and conditions:

(i) vesting over a period of four (4) years as follows: one fourth of the Option
(i.e. an option to purchase 2,325 Ordinary Shares) shall vest upon the lapse of
one year from the date of grant of the Option (the “Initial Vesting Date”). The
remainder of the Option (i.e. an option purchase 6,975 Ordinary Shares) shall
vest on a quarterly basis in twelve equal installments, commencing on the
Initial Vesting Date;
(ii) a purchase price per Ordinary Share of US$24.36; and
(iii) the entering by the Employee into an Option Agreement covering such
Option, acceptable to the Board and similar in all material respects to the
Option Agreements between the Company and its other executive officers.

2.4.   Manager’s Insurance. The Company shall insure the Employee under a
Manager’s Insurance Policy, including insurance in the event of illness or loss
of capacity for work (the “Policy”), and shall pay a sum of up to an aggregate
of 15.83% of the Salary towards the Policy, of which (i) 8.33% shall be on
account of severance compensation, which shall be payable to the Employee upon
severance, in accordance with the provisions of this Agreement; (ii) 5% of the
Salary on account of pension fund payments; and (iii) up to 2.5% of the Salary
on account of disability pension payments. The Company shall deduct 5% from the
Salary to be paid on behalf of the Employee towards the Policy. The Employee may
extend an existing policy or plan and incorporate it into the Policy, at his
discretion.       The Company and the Employee agree and acknowledge that in the
event the Company transfers ownership of the Policy or the right to receive such
policy to the Employee, then such transfer shall be credited against any
obligation that the Company may have to pay severance pay to the Employee
pursuant to the Severance Pay Law — 1963 (the “Severance Pay Law”). Employee
agrees that the payments by the Company to the Policy in accordance with the
terms hereof, shall be instead of any statutory obligation of the Company to pay
severance pay to the Employee, and not in addition thereto, all

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    in accordance with Section 14 of the Severance Pay Law. The Parties hereby
adopt the General Approval of the Minister of Labor and Welfare, on Employers’
Payments to Pension Funds and Insurance Policies Instead of Severance Pay
According to Section 14 of the Severance Pay Law, attached hereto as Exhibit A.
      The Company hereby waives its right to a refund of payments it made to the
Policy, except: (i) in the event that Employee’s right to severance pay was
denied by a final judgment pursuant to Section 16 or 17 of the Severance Pay Law
(in which case Company shall only be entitled to a refund of such funds to the
extent that severance pay was denied); or (ii) in the event that the Employee
withdrew monies from the Policy (other than by reason of an “Entitling Event”,
i.e. death, disability or retirement at or after the age of sixty (60)).   2.5.
  Vocational Studies. The Company shall open and maintain a “Keren Hishtalmut”
Fund for the benefit of the Employee (the “Fund”). The Company shall contribute
to such Fund an amount equal to 7-1/2% of the Salary and the Employee shall
contribute to the Fund an amount equal to 2-1/2% of the Salary. The Employee
hereby instructs the Company to transfer to the Fund Employee’s contribution
from the Salary. Upon termination of this Agreement by either Party, other than
termination by the Company for Cause, the Company shall assign and transfer to
the Employee the ownership in the Fund.   2.6.   Vacation. The Employee shall be
entitled to annual paid vacation of 24 working days. Subject to applicable law,
up to two (2) years’ equivalent of vacation days may be accumulated and may, at
the Employee’s option, upon thirty (30) days’ prior written notice to the
Company, be converted into cash payments in an amount equal to the proportionate
part of the Salary for such days.       Employee shall coordinate in advance
with the CEO the dates of the vacation hereunder.   2.7.   Sick Leave. The
Employee shall be entitled to fully paid sick leave pursuant to the Sick Pay Law
(1976).   2.8.   Annual Recreation Allowance (Dme’i Havra’a). The Employee shall
be entitled to annual recreation allowance according to applicable law.   2.9.  
Company Car.

  (a)   The Company shall provide the Employee with a Company car (the “Company
Car”), as determined by the CEO, at his discretion, which car shall be
categorized “Group 4”. The Company Car shall be placed with the Employee for his
business and personal use. Employee shall take good care of the Company Car and
ensure that the provisions of the insurance policy and the Company’s rules
relating to the Company Car are strictly, lawfully and carefully observed.    
(b)   Subject to applicable law, the Company shall bear all fixed and ongoing
expenses relating to the Company Car and to the use and maintenance thereof,
excluding expenses incurred in connection with any violations of law, which
shall be paid solely by Employee. The Company shall gross-up any and all taxes
applicable in connection with said Company Car and the use thereof, in
accordance with applicable income tax regulations. All such expenses borne, and
tax payments grossed-up, by the Company pursuant to this Section 2.9(b) are
included in the Salary.     (c)   Upon the termination of employment hereunder,
the Employee shall return the Company Car (together with its keys and any other
equipment supplied and/or

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      installed therein by Company and any documents relating to the Company
Car) to the Company’s principal office. Employee shall have no rights of lien
with respect to the Company Car and/or any of said equipment and documents.

2.10.   Telephone. The Company shall furnish, for the use of the Employee, a
cellular telephone (the “Company Phone”), and shall bear all the costs and
expenses associated with the use of the Company Phone. The Company will bear the
tax applicable to the use of the Company Phone by the Employee, according to
applicable law. All such costs, expenses and tax payments borne and payable by
the Company pursuant to this Section 2.10 are included in the Salary. The
provisions of Section 2.9(c) above shall apply to the Company Phone, mutatis
mutandis.   2.11.   Certain Reimbursements. The Employee shall be entitled to
full reimbursement from the Company for reasonable expenses incurred during the
performance of his duties hereunder up to a limit of NIS 1,500 per month, upon
submission of substantiating documents, according to the Company’s policy. The
reimbursement of any expenses in excess of the foregoing limit shall require the
prior approval of the CEO.   2.12.   Taxes. The Employee will bear any tax
applicable on the payment or grant of any of the above Salary and/or benefits,
according to the then applicable law. The Company shall be entitled to and shall
deduct and withhold from any amount or benefit payable to the Employee, any and
all taxes, withholdings or other payments as required under any applicable law.
  3.   Confidentiality   3.1.   The Employee hereby agrees that he shall not,
directly or indirectly, disclose or use at any time any trade secrets or other
confidential information of any type or nature, whether patentable or not, of
the Company, its subsidiaries, affiliates or parent company now or hereafter
existing, including but not limited to, any (i) processes, formulas, trade
secrets, copyrights, innovations, inventions, discoveries, improvements,
research or development and test results, specifications, data, patents, patent
applications and know-how of any type or nature; (ii) marketing plans, business
plans, strategies, forecasts, financial information, budgets, projections,
product plans and pricing; (iii) personnel information, salary, and
qualifications of employees; (iv) agreements, customer and supplier information,
including identities and product sales forecasts; and (v) any other information
of a confidential or proprietary nature (collectively, “Confidential
Information”), of which the Employee is or becomes informed or aware during the
employment, whether or not developed by the Employee, it being agreed that for
purposes of this Section 3.1, the term Confidential Information shall not
include information that has entered into the public domain through no wrongful
act by Employee. Upon termination of this Agreement, or at any other time upon
request of the Company, the Employee shall promptly deliver to the Company all
physical and electronic copies and other embodiments of Confidential Information
and all memoranda, notes, notebooks, records, reports, manuals, drawings,
blueprints and any other documents or things belonging to the Company, and all
copies thereof, in all cases, which are in the possession or under the control
of the Employee.   3.2.   Employee hereby acknowledges and that all Confidential
Information and any other rights in connection therewith are and shall at all
times remain the sole property of the Company.   4.   Non-Competition and
Non-Solicitation   4.1.   The Employee agrees and undertakes that he will not,
for so long as this Agreement is in effect and for a period of two (2) years
thereafter (the “Non-Competition Period”),

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    compete or to assist others to compete, whether directly or indirectly, with
the business of the Company, as currently conducted and as conducted and/or
proposed to be conducted during the Non-Competition Period.   4.2.   The
Employee further agrees and undertakes that during the Non-Competition Period,
he will not directly or indirectly solicit any business which is similar to the
Company’s business from individuals or entities that are customers, suppliers or
contractors of the Company, any of its subsidiaries, affiliates or parent
company during the Non-Competition Period, without the prior written consent of
the CEO.   4.3.   The Employee further agrees and undertakes that during the
Non-Competition Period, without the prior written consent of the CEO, he will
not employ, offer to employ, or in any way directly or indirectly solicit or
seek to obtain or achieve the employment by any business or entity of any person
employed by either the Company, its subsidiaries, affiliates, parent company or
any successors or assigns thereof during the Non-Competition Period.   4.4.  
The Parties hereto agree that the duration and area for which the covenants set
forth in this Section 4 are to be effective are necessary to protect the
legitimate interests of the Company and its development efforts and accordingly
are reasonable, in terms of their geographical and temporal scope. In the event
that any court determines that the time period and/or area are unreasonable and
that such covenants are to that extent unenforceable, the Parties hereto agree
that such covenants shall remain in full force and effect for the greatest
period of time and in the greatest geographical area that would not render them
unenforceable. In addition, the Employee acknowledges and agrees that a breach
of Sections 3, 4 or 5 hereof, shall cause irreparable harm to the Company, its
subsidiaries, affiliates and/or parent company and that the Company shall be
entitled to specific performance of this Agreement or an injunction without
proof of special damages, together with the costs and reasonable attorney’s fees
and disbursements incurred by the Company in enforcing its rights under
Sections 3, 4 or 5. The Employee acknowledges that the compensation and benefits
he receives hereunder are paid, inter alia, as consideration for his
undertakings contained in Sections 3, 4 and 5.   5.   Creations and Inventions  
5.1.   The Company shall be the sole and exclusive owner of any Inventions (as
defined below), and Employee hereby assigns to the Company any and all of his
rights, title and interest in such intellectual property free and clear of any
third parties rights. The Employee shall inform the Company of any Invention
relating to the Company’s technology, its applications components or any
intellectual property relating thereto, and shall execute any necessary
assignments, patent forms and the like and will assist in the drafting of any
description or specification of the Invention as may be required for the
Company’s records and in connection with any application for patents or other
forms of legal protection that may be sought by the Company. The Employee shall
treat all information relating to any Invention as Confidential Information
according to Section 3 above.   5.2.   Without limiting the foregoing,
“Inventions” shall include any and all intellectual property, including without
limitation, ideas, inventions, processes, formulas, source and object codes,
data, programs, know how, improvements, discoveries, designs, techniques, trade
secrets, patents and patents applications, copyrights, mask work and any other
intellectual property rights throughout the world, generated, produced, reduced
to practice, or developed by Employee during or in connection with his
employment by the Company.

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5.3.   The Company’s rights under this Section 5 shall be worldwide, and shall
apply to any such Invention notwithstanding that it is perfected or reduced to
specific form after the Employee has ceased his services hereunder.   6.   Term
and Termination.   6.1.   This Agreement shall be in effect commencing as of the
Effective Date and shall continue in full force and effect for an undefined
period, unless and until terminated by either Party by sixty (60) days prior
written notice to the other Party. Each of such prior notice periods shall be
referred to as the “Notice Period”, as applicable.   6.2.   Notwithstanding
anything to the contrary herein, the Company may terminate this Agreement in the
event of the inability of the Employee to perform his duties hereunder, whether
by reason of injury (mental or physical), illness or otherwise, incapacitating
the Employee for a period exceeding 90 days.   6.3.   Notwithstanding anything
to the contrary herein, the Company may terminate this Agreement at any time,
effective immediately and without need for prior written notice, and without
derogating from any other remedy to which the Company may be entitled, for
Cause.       For the purposes of this Agreement, the term “Cause” shall mean:
(i) a material breach by Employee of this Agreement; (ii) any breach by Employee
of his fiduciary duties or duties of care to the Company; (iii) Employee’s
dishonesty or fraud or felonious conduct; (iv) Employee’s embezzlement of funds
of the Company; (v) any conduct by Employee, alone or together with others,
which is materially injurious to the Company, monetary or otherwise;
(vi) Employee’s gross negligence or willful misconduct in performance of his
duties and/or responsibilities hereunder; (vii) Employee’s disregard or
insubordination of any lawful resolution and/or instruction of the CEO with
respect to Employee’s duties and/or responsibilities towards the Company;
(viii) the occurrence of an event or circumstance which may result in the
Employee having a conflict of interest with his position with the Company,
without Employee having notified the Company thereof, as provided herein;
(ix) any breach by Employee of his confidentiality undertakings to the Company;
or (x) any consequences which would entitle the Company to terminate Employee’s
employment without severance payments under the Severance Pay Law.   6.4.   The
Employee shall cooperate with the Company and assist the integration into the
Company’s organization of the person or persons who will assume the Employee’s
responsibilities, pursuant to Company’s instructions. At the option of the
Company, the Employee shall, during such period, either continue with his duties
or remain absent from the premises of the Company, subject to applicable law. At
any time during the Notice Period, the Company may elect to terminate this
Agreement and the relationship with the Employee immediately, provided, that
Employee shall be entitled to all payments and other benefits due to him
hereunder as he would have been entitled to receive for the remaining period of
the Notice Period.   6.5.   Upon termination of Employee’s employment with the
Company hereunder, for any reason whatsoever, the Company shall have no further
obligation or liability towards the Employee in connection with his employment
as aforesaid. The Company may set-off any outstanding amounts due to it by
Employee against any payment due by the Company to the Employee, subject to
applicable law. Without limiting the generality of the foregoing, in the event
that Employee fails to comply with his prior notice or other obligations
hereunder or under applicable law, the Company shall be entitled to set-off

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    any amount to which Employee would have been entitled during the Notice
Period, from any payment due by the Company to the Employee, all without
prejudice to any other remedy to which the Company may be entitled pursuant to
this Agreement or applicable law.   6.6.   The provisions of Sections 2.9(c),
last sentence of Section 2.10, Sections 3, 4, 5, 6.5, 6.6 and 8.4 shall survive
the termination or expiration of this Agreement for any reason whatsoever. The
provisions of the last sentence of Section 2.5 shall survive the termination of
this Agreement subject to the terms set forth in such sentence.   7.   Notices.
  7.1.   Any and all notices and communications in connection with this
Agreement shall be in writing, addressed to the parties as follows:

         
 
  If to the Company:   Protalix Ltd.
 
      2 Snunit Street, POB 455, Carmiel, 20100, Israel
 
       
 
  It to the Employee:   Yossef Maimon
 
      10 Feinstein St., Tel Aviv

7.2.   All notices shall be given by registered mail (postage prepaid), by
facsimile or email or otherwise delivered by hand or by messenger to the
Parties’ respective addresses as above or such other address as may be
designated by notice. Any notice sent in accordance with this Section 7 shall be
deemed received upon the earlier of: (i) if sent by facsimile or email, upon
transmission and electronic confirmation of transmission or (if transmitted and
received on a non-business day) on the first business day following transmission
and electronic confirmation of transmission, (ii) if sent by registered mail,
upon 3 (three) days of mailing, (iii) if sent by messenger, upon delivery; and
(iv) the actual receipt thereof.   8.   Miscellaneous.   8.1.   Headings;
Interpretation. Section and Subsection headings contained herein are for
reference and convenience purposes only and shall not in any way be used for the
interpretation of this Agreement.   8.2.   Entire Agreement. This Agreement
constitutes the entire agreement between the Parties with respect to the subject
matters hereof and cancels and supersedes all prior agreements, understandings
and arrangements, oral or written, between the Parties with respect to such
subject matters.   8.3.   Amendment; Waiver. No provision of this Agreement may
be modified or amended unless such modification or amendment is agreed to in
writing and signed by the Employee and the Company. The observance of any term
hereof may be waived (either prospectively or retroactively and either generally
or in a particular instance) only with the written consent of the Party against
which/whom such waiver is sought. No waiver by either Party at any time to act
with respect to any breach or default by the other Party of, or compliance with,
any condition or provision of this Agreement to be performed by such other Party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.   8.4.   Governing Law; Dispute
Resolution. This Agreement shall be governed by and construed in accordance with
the laws of the State of Israel. Any dispute arising out of or relating to this
Agreement shall be exclusively resolved by the competent court in Tel-Aviv
Jaffa.

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8.5.   Severability. The provisions of this Agreement shall be deemed severable
and the invalidity or unenforceability of any provision shall not affect the
validity or enforceability of the other provisions hereof. If any part of this
Agreement is determined to be invalid, illegal or unenforceable, such
determination shall not affect the validity, legality or enforceability of any
other part of this Agreement; and the remaining parts shall be enforced as if
such invalid, illegal, or unenforceable part were not contained herein,
provided, however, that in such event this Agreement shall be interpreted so as
to give effect, to the greatest extent consistent with and permitted by
applicable law, to the meaning and intention of the excluded provision as
determined by such court of competent jurisdiction.   8.6.   Assignment. Neither
this Agreement or any of the Employee’s rights, privileges, or obligations set
forth in, arising under, or created by this Agreement may be assigned or
transferred by the Employee without the prior consent in writing of the Company.
The Company shall be entitled to assign its rights and obligations hereunder to
any entity acquiring a material part of its assets or to a subsidiary, affiliate
or parent company thereof (as such terms are defined in the Israeli Securities
Law-1968).

[Signature Page to Protalix Ltd. Employment Agreement]
IN WITNESS WHEREOF, the Parties hereto have executed this Employment Agreement
as of the date first above-mentioned.

         
/s/ David Aviezer
 
PROTALIX LTD.
  Yossef Maimon
 
YOSSEF MAIMON    

By: David Aviezer

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