Exhibit 10.1

SCIENTIFIC ADVISORY BOARD AGREEMENT

This Scientific Advisory Board Agreement (this “Agreement”), dated August 5,
2007 (the “Effective Date”), is by and between Protalix BioTherapeutics, Inc., a
Florida corporation (the “Company”), and Prof. Aaron Ciechanover (“Advisor”).  

1.

SERVICES

Advisor shall provide advisory services to the Company from time to time at the
Company’s request, which advisory services shall include but not be limited to
the following: consulting with the Company’s management within Advisor’s
professional area of expertise; exchanging strategic and business development
ideas with the Company; attending scientific, medical and business meetings with
the Company’s management, such as meetings with the United States Food and Drug
Administration and comparable foreign regulatory authorities, meetings with
strategic or potential strategic partners and other meetings relevant to
Advisor’s area of expertise; and attending meetings of the Company’s Scientific
Advisory Board; provided, that Advisor shall provide the Company with at least
six (6) working days of advisory services per 12-month period (the “Services”).
 Advisor shall render to the Company the services in a timely and professional
manner consistent with industry standards, in accordance with this Agreement.
 It is acknowledged that the Services shall include attendance at meetings from
time to time either in person or by video or teleconference.  Advisor may not
subcontract or otherwise delegate its obligations under this Agreement.  Subject
to compliance with Advisor’s obligations hereunder, Advisor shall retain the
sole control and discretion to determine the methods by which Advisor performs
the Services and the places at which, the equipment and supplies with which and
the hours during which such Services are to be rendered.

2.

PAYMENTS

2.1

Compensation.  In consideration of the Services to be rendered in connection
with this Agreement, Advisor shall be paid $18,000 per annum, payable in two,
semi-annual installments.

2.2

Restricted Stock Grant.  The Advisor will receive a grant of 8,000 shares of
restricted common stock of the Company under the Company’s 2006 Stock Incentive
Plan (the “Plan”) to be set forth in a Restricted Stock Award Agreement (the
“Award Agreement”).  The restricted shares will vest over a four-year period as
follows: 25% of the shares shall vest on the first anniversary of the date of
grant, and the remaining 75% of the shares shall vest in 36 equal, monthly
increments thereafter.  Such grant, which was approved by the Board of Directors
of the Company, will be issued by the Company upon it receipt of written notice
of Acceptance by the Advisor (the “Acceptance”). Advisor acknowledges that until
the Acceptance, no grant shall be in effect.  Advisor further acknowledges that
the vesting of the restricted shares shall cease upon the date of termination of
Advisor’s Continuous Service (as defined in the Plan) for any reason.  In the
event this Agreement or Advisor’s Continuous Service is terminated for any
reason any restricted shares held by Advisor immediately following such
termination of Continuous Service shall be deemed reconveyed to the Company and
the Company shall thereafter be the legal and beneficial owner of the restricted
shares and shall have all rights and interest in or related thereto without
further action by Advisor.  

2.3

Expenses.  The Company shall reimburse Advisor for reasonable travel and other
business expenses that are incurred by Advisor in the performance of the
Services and are approved in advance by the Company, in accordance with the
Company’s general policies, as may be amended from time to time.  Advisor shall
provide the Company with an itemized list of all such expenses and supporting
receipts with each invoice therefor.

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2.4

Taxes.  Advisor acknowledges and agrees that it shall be Advisor’s obligation to
report as income all compensation received by Advisor pursuant to this Agreement
and to pay any withholding taxes, self-employment taxes, and social security,
unemployment or disability insurance or similar items, including interest and
penalties thereon, in connection with any payments made to Advisor by the
Company pursuant to this Agreement.  Advisor agrees to indemnify, hold harmless
and, at the Company’s discretion, defend the Company against any and all
liability related thereto, including, without limitation, any taxes, penalties
and interest the Company may be required to pay as a result of Advisor’s failure
to report such compensation or make such payments.  

3.

PROPRIETARY INFORMATION

3.1

Proprietary Information.  Advisor understands that its work for the Company will
involve access to and creation of confidential, proprietary and trade secret
information and materials of the Company (or its affiliates, licensors,
suppliers, vendors or collaborators) (collectively, “Proprietary Information”).
 Proprietary Information includes, without limitation: any (a) tangible
chemical, biological and physical research materials provided by the Company to
Advisor and any such materials developed by Advisor in connection with the
performance of the Services, information, ideas or materials of a technical or
creative nature, such as research and development progress and results, products
and proposed products, designs and specifications, computer source and object
code, patent applications, and other materials and concepts relating to the
Company’s products, services, processes, technology or other intellectual
property rights; (b) information, ideas or materials of a business nature, such
as non-public financial information; information regarding profits, costs,
marketing, purchasing, sales, collaborators, suppliers, contract terms,
employees and salaries; product development plans; business and financial plans
and forecasts; and marketing and sales plans and forecasts; (c) all personal
property, including, without limitation, all books, manuals, records, reports,
notes, contracts, lists, blueprints and other documents or materials, or copies
thereof, received by Advisor in the course of Advisor’s rendering of Services to
the Company, including, without limitation, records and any other materials
pertaining to Inventions (as defined below); and (d) the terms and conditions of
this Agreement.  

3.2

Restrictions on Use and Disclosure.  Advisor understands that Proprietary
Information is extremely valuable to the Company and its affiliates, licensors,
suppliers, vendors and collaborators.  Accordingly, Advisor agrees during the
term of this Agreement and thereafter that it: (a) shall hold all Proprietary
Information in confidence and trust for the benefit of the Company; (b) shall
reveal Proprietary Information only to such of its employees, contractors,
agents, consultants, representatives or affiliates (“Representatives”) who need
to know the Proprietary Information for the purpose of Advisor’s performance of
the Services, who are informed by Advisor of the confidential nature of the
Proprietary Information and who shall agree in writing to act in accordance with
the terms and conditions of this letter agreement; (c) shall not copy or use (or
allow any of its Representatives to copy or use) any Proprietary Information,
except as may be necessary to perform the Services; (d) shall use the
Proprietary Information only for the benefit of the Company (and not for the
benefit of Advisor or any third party); and (e) shall not disclose or otherwise
make available any such Proprietary Information to any third party except as
authorized in writing and in advance by the Company.  All Proprietary
Information is and shall remain the sole property of the Company.

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3.3

Exclusions.  The foregoing restrictions on use and disclosure shall not apply to
any Proprietary Information to the extent Advisor can prove such Proprietary
Information: (a) is or has become generally known to the public through no
unlawful act of Advisor; (b) was known to Advisor at the time of its disclosure
by the Company, as evidenced by Advisor’s written records; (c) was independently
developed by Advisor without any use of the Proprietary Information, as
evidenced by Advisor’s written records; (d) becomes known to Advisor from a
source other than the Company without breach of this Agreement and otherwise not
in violation of the Company’s rights, as evidenced by Advisor’s written records;
(e) such disclosure is approved in advance and in writing by the Company; or (f)
Advisor is legally compelled to disclose such Proprietary Information, provided
that Advisor shall give advance notice of such compelled disclosure to the
Company, and shall cooperate with the Company in connection with any efforts to
prevent or limit the scope of such disclosure and/or use of the Proprietary
Information.  

3.4

Publications.  During the term of this Agreement and for a period of two (2)
years thereafter, Advisor agrees to submit to the Company for a period of at
least thirty (30) days (the “Review Period”) a copy of any proposed manuscript
or other materials to be published or otherwise publicly disclosed by Advisor
(each a “Proposed Publication”) which contains information derived, in whole or
in part, from Services performed for the Company in sufficient time to enable
the Company to determine if patentable Inventions or Proprietary Information
would be disclosed.  Nothing herein shall be construed to restrict Advisor’s
right to publish material which does not contain Information.  Following the
expiration of the Review Period, if the Company does not notify Advisor that the
Proposed Publication discloses patentable Inventions or Proprietary Information
such Proposed Publication shall be deemed to be approved by the Company for
publication.  In addition, Advisor will cooperate with the Company in this
respect and will delete from the manuscript or other disclosure any proprietary
Information if requested by the Companies and will assist the Companies in
filing for patent protection for any patentable Inventions prior to publication
or other disclosure.

3.5

Disclosure of Relationship.  The parties  each shall be entitled to disclose
that Advisor is serving on the Company’s Scientific Advisory Board, including in
any filing, prospectus, press release, business plan, advertisement, or other
offering document of the Company or its affiliates; provided, that Advisor shall
have the opportunity to review and approve press releases relating to
announcement of this Agreement and developments in the business of the Company
prior to release, with approval of such press releases not to be unreasonably
delayed or withheld.  Notwithstanding the foregoing, the Company shall not
require the approval by Advisor of any governmental filing or press release that
in the opinion of the Company’s counsel is required to be made.

4.

CREATIONS

4.1

Definition.  As used herein, “Inventions” shall include, without limitation, all
designs, know-how, trade secrets, copyrightable works, ideas, discoveries,
creations, inventions, innovations, technology, apparatus, techniques, methods,
biological processes, cell lines, laboratory notebooks and formulas (whether or
not patentable or copyrightable or constituting trade secrets) and other
inventions, and any related work-in-progress, improvements or modifications to
the foregoing, that are created, developed or conceived (alone or with others)
in connection with Advisor’s activities for the Company (a) during the term of
this Agreement, whether or not created, developed or conceived during regular
business hours, and (b) if based on Proprietary Information, after termination
of this Agreement.  Inventions shall include, without limitation, all materials
delivered to the Company in connection with this Agreement.

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4.2

Assignment.  All Inventions shall be considered “work made for hire” (as such
term is defined in 17 U.S.C. §101) and shall be the sole property of the
Company, with the Company having the right to obtain and hold in its own name
all intellectual property rights in and to such Inventions.  To the extent that
the Inventions may not be considered “work made for hire,” Advisor hereby
irrevocably assigns and agrees to assign to the Company, without additional
consideration, all right, title and interest in and to all Inventions, whether
currently existing or created or developed later, including, without limitation,
all copyrights, trademarks, trade secrets, patents, industrial rights and all
other intellectual property and proprietary rights related thereto, whether
existing now or in the future, effective immediately upon the inception,
conception, creation or development thereof.  Advisor shall (a) disclose
promptly to the Company all Inventions and (b) whether during or after the
period of its consulting arrangement with the Company, execute such written
instruments and do such other acts as may be necessary in the opinion of the
Company to obtain a patent, register a copyright or otherwise evidence or
enforce the Company’s rights in and to such Inventions (and Advisor hereby
irrevocably appoints the Company and any of its officers as its attorney in fact
to undertake such acts in its name).

4.3

License.  To the extent, if any, that Advisor retains any right, title or
interest in or to any Inventions, Advisor hereby grants to the Company a
perpetual, irrevocable, fully paid-up, transferable, sublicensable, exclusive,
worldwide right and license: (a) to use, reproduce, distribute, display and
perform (whether publicly or otherwise), prepare derivative works of and
otherwise modify, make, sell, offer to sell, import and otherwise use and
exploit (and have others exercise such rights on behalf of the Company) all or
any portion of such Inventions, in any form or media (now known or later
developed); (b) to modify all or any portion of such Inventions, including,
without limitation, the making of additions to or deletions from such
Inventions, regardless of the medium (now or hereafter known) into which such
Inventions may be modified and regardless of the effect of such modifications on
the integrity of such Inventions; and (c) to identify Advisor, or not to
identify Advisor, as one or more authors of or contributors to such Inventions
or any portion thereof, whether or not such Inventions or any portion thereof
have been modified.  Advisor further waives any “moral” rights or other rights
with respect to attribution of authorship or integrity of such Inventions
Advisor may have under any applicable law, whether under copyright, trademark,
unfair competition, defamation, right of privacy, contract, tort or other legal
theory.

5.

TERM AND TERMINATION

5.1

Term.  This Agreement shall commence on the Effective Date and remain in full
force and effect until terminated by Advisor or the Company.

5.2

Termination.  Either party may terminate this Agreement at any time upon ten
(10) days’ prior written notice.

5.3

Effect of Termination.  Upon termination of this Agreement, Advisor shall
immediately cease performing the Services.  Sections 3 through 10 and the
relevant portions of Section 11 shall survive any termination of this Agreement.
 Any termination of this Agreement shall be deemed a termination of Advisor’s
Continuous Service under the Plan and for purposes of the Award Agreement.

5.4

Delivery of the Company Property.  Upon termination of this Agreement, or at any
time the Company so requests, Advisor shall deliver immediately to the Company
all property belonging to the Company, whether given to Advisor by the Company
or prepared by Advisor in the course of rendering the Services, including all
Inventions then in progress and all material in Advisor’s possession containing
Proprietary Information and any copies thereof, whether prepared by Advisor or
others. Following termination, Advisor shall not retain any written or other
tangible (including machine-readable) material containing any Proprietary
Information.  

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6.

BUSINESS RELATIONSHIPS

Advisor acknowledges that the Company’s relationships with its employees,
consultants, contractors, collaborators and vendors are valuable business
assets.  Advisor agrees that, during the term of this Agreement and for two (2)
years thereafter, Advisor shall not (for itself or for any third party) divert
or attempt to divert from the Company any business, employee, consultant,
contractor, collaborator or vendor, through solicitation or otherwise, without
the prior written consent of the Company.

7.

CONFIDENTIAL INFORMATION OF OTHERS

Advisor shall not breach any agreements to keep in confidence, or to refrain
from using, the confidential, proprietary or trade secret information of another
client or employer.  Advisor shall not provide to the Company any information of
another client or employer, in the Inventions or otherwise, nor shall Advisor
use any such information in its activities for the Company, without the prior
written consent of the Company and such other client or employer.

8.

WARRANTIES AND COVENANTS

Advisor represents, warrants and covenants that: (a) Advisor has the full power
and authority to enter into this Agreement and to perform its obligations
hereunder, without the need for any consents, approvals or immunities not yet
obtained; (b) Advisor has the right to grant the rights and assignments granted
herein, without the need for any assignments, releases, consents, approvals,
immunities or other rights not yet obtained; (c) the Services, including,
without limitation, any deliverables required hereunder, shall be free from
material errors or other defects; (d) the Inventions (and the exercise of the
rights granted herein with respect thereto) do not and shall not infringe,
misappropriate or violate any patent, copyright, trademark, trade secret,
publicity, privacy or other rights of any third party, and are not and shall not
be defamatory or obscene; (e) neither the Inventions nor any element thereof
shall be subject to any restrictions or to any mortgages, liens, pledges,
security interests, encumbrances or encroachments; and (f) each of Advisor’s
employees and contractors (if any) involved in the development of the Inventions
have executed (or, prior to any such involvement shall execute) a written
agreement with Advisor in which such persons (i) assign to Advisor all right,
title and interest in and to the Inventions in order that Advisor may fully
grant the rights to the Company as provided herein and (ii) agree to be bound by
confidentiality and non-disclosure obligations equivalent to those set forth in
this Agreement.  The Company hereby disclaims all warranties of any kind,
whether express, implied, statutory or otherwise, with respect to any
Proprietary Information or other information or materials supplied by the
Company to Advisor hereunder, including, without limitation, any warranties with
respect to any specifications for the Inventions or other deliverables required
hereunder.

9.

INDEMNIFICATION

Advisor shall indemnify and hold harmless, and at the Company’s request defend,
the Company and its affiliates, successors and assigns (and their respective
officers, directors, employees, sublicensees, Companies and agents) from and
against any and all claims, losses, liabilities, damages, settlements, expenses
and costs (including, without limitation, attorneys’ fees and court costs) which
arise out of or relate to: (a) any breach (or claim or threat thereof that, if
true, would be a breach) of this Agreement by Advisor, including, without
limitation, any breach or alleged breach of any representation, warranty or
covenant of Advisor set forth in Section ; or (b) any third party claim or
threat thereof that the Services or Inventions (or the exercise of the rights
granted herein with respect thereto) infringe, misappropriate or violate any
patent, copyright, trademark, trade secret, publicity, privacy or other rights
of any third party, or are defamatory or obscene.

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10.

LIMITATION OF LIABILITY

To the extent permitted by applicable law: (a) in no event shall the Company be
liable under any legal theory for any special, indirect, consequential,
exemplary or incidental damages, however caused, arising out of or relating to
this Agreement, even if the Company has been advised of the possibility of such
damages; and (b) in no event shall the Company’s aggregate liability arising out
of or relating to this Agreement (regardless of the form of action giving rise
to such liability, whether in contract, tort or otherwise) exceed the fees
payable by the Company hereunder.  

11.

MISCELLANEOUS

11.1

Assignment.  Neither party shall assign, sell, transfer, delegate or otherwise
dispose of, whether voluntarily or involuntarily, by operation of law or
otherwise, this Agreement or any or its rights or obligations under this
Agreement; provided, however, the Company may assign, sell, transfer, delegate
or otherwise dispose of this Agreement or any of its rights and obligations
hereunder as part of a merger, consolidation, corporate reorganization, sale of
all or substantially all of the Company’s assets of the business to which
Advisor’s services relate, sale of stock, change of name or like event.  Any
purported assignment, sale, transfer, delegation or other disposition, except as
permitted herein, shall be null and void.  Subject to the foregoing, this
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective successors and permitted assigns.

11.2

Notices.  Any notice, request, demand or other communication required or
permitted hereunder shall be in writing, shall reference this Agreement and
shall be deemed to be properly given: (a) when delivered personally; (b) when
sent by facsimile, with written confirmation of receipt by the sending facsimile
machine; (c) five (5) business days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (d) upon receipt
for an express courier, with written confirmation of receipt.  All notices shall
be sent to the address set forth on the signature page of this Agreement and to
the notice of the person executing this Agreement (or to such other address or
person as may be designated by a party by giving written notice to the other
party pursuant to this Section).

11.3

Severability.  If any provision of this Agreement, or the application thereof to
any person, place or circumstance, shall be held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, such provision
shall be enforced to the maximum extent possible so as to effect the intent of
the parties, or, if incapable of such enforcement, shall be deemed to be deleted
from this Agreement, and the remainder of this Agreement and such provisions as
applied to other persons, places and circumstances shall remain in full force
and effect.  

11.4

Waiver.  The waiver by either party of a breach of or a default under any
provision of this Agreement shall not be effective unless in writing and shall
not be construed as a waiver of any subsequent breach of or default under the
same or any other provision of this Agreement, nor shall any delay or omission
on the part of either party to exercise or avail itself of any right or remedy
that it has or may have hereunder operate as a waiver of any such right or
remedy.  

11.5

Governing Law.  This Agreement is to be construed in accordance with and
governed by the internal laws of the State of New York without giving effect to
any choice of law rule of such State.

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11.6

Relationship of Parties.  This Agreement shall not be construed as creating an
agency, partnership, joint venture or any other form of association, for tax
purposes or otherwise, between the parties; and the parties shall at all times
be and remain independent contractors.  Except as expressly agreed by the
parties in writing, neither party shall have any right or authority, express or
implied, to assume or create any obligation of any kind, or to make any
representation or warranty, on behalf of the other party or to bind the other
party in any respect whatsoever.  Neither party shall have any obligation or
duty to the other party except as expressly and specifically set forth herein,
and no such obligation or duty shall be implied by or inferred from this
Agreement or the conduct of the parties hereunder.  Advisor (and its employees,
agents and contractors) shall not be entitled to any of the benefits that the
Company may make available to its employees, such as group health, life,
disability or worker’s compensation insurance, profit-sharing or retirement
benefits, and the Company shall not withhold or make payments or contributions
therefor or obtain such protection for Advisor or its employees, contractors or
agents.  Advisor shall be solely responsible for all tax returns and payments
required to be filed with or made to any federal, state or local tax authority
with respect to Advisor’s performance of services and receipt of fees under this
Agreement.

11.7

Headings.  The headings used in this Agreement are for convenience only and
shall not be considered in construing or interpreting this Agreement.

11.8

Entire Agreement.  This Agreement (including the Exhibits attached hereto, which
are incorporated herein by reference) is the final, complete and exclusive
agreement of the parties with respect to the subject matter hereof and
supersedes and merges all prior or contemporaneous proposals, discussions,
negotiations, understandings, promises, representations, conditions,
communications and agreements, whether written or oral, between the parties with
respect to such subject matter and all past courses of dealing or industry
custom.  

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered as of the Effective Date.

 

ADVISOR:

 

By:     

 /s/ Aaron Ciechanover       

 

Name:

Aaron Ciechanover, M.D.

 

 

 

 

 

 

PROTALIX BIOTHERAPEUTICS, INC.

 

By:     

 /s/ David Aviezer

 

Name:

David Aviezer, Ph.D.

 

Title:

President and

 

 

Chief Executive Officer