exhibit10-1.htm


    
Exhibit
10.1

      EMPLOYMENT
AGREEMENT

      


      This
EMPLOYMENT AGREEMENT (this "Agreement") is made effective
as of October 18, 2009 (the "Effective Date"), by and
between BioCancell Therapeutics Inc., a Company organized under the laws of the
State of Delaware (the "Parent"), BioCancell
Therapeutics Israel, Ltd. a Company organized under the laws of the State of
Israel (the "Company"
and together with the Parent, the "Companies") and Mr. Uri Danon,
Identification No. 012658811 (the "Employee") (the Companies and
the Employee shall sometimes be referred to, each as a "Party" and collectively, as
the "Parties").

       

      


      
        	
                WHEREAS,

              	
                the
      Companies desires to employ the Employee as their Chief Executive Officer
      and the Employee desires to serve the Companies 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
      Companies shall employ the Employee, who shall begin an integration period
      towards his assumption of the position of Chief Executive Officer of the
      Companies ("CEO"),
      in parallel to the current CEO of the Companies. On November 1, 2009, the
      Employee shall begin serving as the CEO, reporting directly to the Board
      of Directors of the Parent (the "Board of Directors"),
      until such time as the Board of Directors, at its sole discretion,
      determines otherwise and/or appoints another person to such position.
      Employee's position with the Companies in accordance herewith shall be
      regarded as the "Position". In addition,
      during the first 3 months commencing on the Effective Date, the Employee
      shall be entitled to be employed on an 80% basis and devote 20% of his
      working time to his former position to ensure swift transition in his
      former employer. For the period during which the Employee is actually
      employed on an 80% basis, the Salary shall be adjusted accordingly. The
      Employee shall be entitled to decide at any time, during the initial three
      month period to commence work at the Companies on a 100% basis, in which
      case his Salary will be paid
accordingly.

              


      

       

      
        	
                1.2.  

              	
                The
      Employee's duties and responsibilities shall be those duties and
      responsibilities customarily performed by a person in a similar
      position.

              


      

       

      
        	
                1.3.  

              	
                Subject
      to Section 1.1 above, the Employee shall be employed on a full-time basis.
      The Employee shall devote his full and undivided attention and full
      working time, know-how, energy, talent and experience to the business and
      affairs of the Companies and shall use his best efforts and shall devote
      such time as necessary for the fulfillment of his duties and
      responsibilities under this
Agreement.

              


      

       

      
        	
                1.4.  

              	
                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 actively in any other business activity or render any services,
      which may hinder the performance of his obligations hereunder, with or
      without compensation, for any other person, firm or company (except as
      provided for in Section 1.3 of this Agreement, and the Employee’s position
      as a director in Atox Bio, Inc.). The Employee shall not hold any position
      in any additional company without the Board of Directors' prior written
      consent.

              


      

       

      
        	
                1.5.  

              	
                The
      Employee shall perform his duties hereunder at the Companies' facilities
      in Israel. Employee acknowledges and agrees that the performance of his
      duties hereunder may require significant domestic and international travel
      at the Companies' request.

              


      

       

      
        	
                1.6.  

              	
                It
      is agreed between the Parties that the position that Employee holds within
      the Companies 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 Companies 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
      employment agreement or any custom or practice of the Companies in respect
      of any of its other employees or
contractors.

              


      

       

      
        	
                1.7.  

              	
                The
      Employee hereby represents and warrants to the Companies, that the
      execution and delivery of this Agreement and the fulfillment of the terms
      hereof will constitute the valid, binding and enforceable obligations of
      the Employee and will not violate, conflict with or constitute a default
      under or breach of any agreement and/or undertaking and/or instrument,
      judgment, order, writ or decree to which the Employee is a party or by
      which he is bound, or any provision of law, rule or regulation applicable
      to the Employee, and do not require the consent of any person or entity
      which has not been obtained prior to the execution hereof; and in the
      performance of his obligations hereunder the Employee will not make use of
      (i) any confidential or proprietary information belonging to any third
      party, or (ii) any information to which the Employee is restricted from
      disclosing or using due to contractual undertakings or by
    law.

              


      

       

       
 

      
        	
                2.  

              	
                Salary and Employee
      Benefits.

              


      

       

      In full
consideration for the Employee's employment with the Companies, commencing as of
the Effective Date, the Employee shall be entitled to the following payments,
and benefits:

       

      
        	
                2.1.  

              	
                Salary. The
      Companies shall pay the Employee a gross salary of NIS  42,000
      per month (on a full time basis), as shall be adjusted from time to time
      in accordance with the provisions hereof (the "Salary"). All income and
      other taxes shall be deducted as required by law. The Employee shall be
      entitled to receive cost-of-living adjustments ("Tosefet Yoker") and other
      adjustments as may be required by
law.

              


      

       

      The
Salary shall be payable monthly in arrears, no later than the tenth (10th) day
of each month. The Employee acknowledges that the Salary to which he is entitled
pursuant to this Agreement constitutes due consideration for him working
overtime and on days of rest.

       

       

      
        	
                2.2.  

              	
                Sick Leave. The
      Employee shall be entitled to fully paid sick leave pursuant to the Sick
      Pay Law (1976). The Employee may carry forward any unused sick leave, not
      to exceed the maximum prescribed by law, but shall not be entitled to any
      payment for unused sick leave.

              


      

       

      
        	
                2.3.  

              	
                Vacation. The
      Employee shall be entitled to an annual vacation of twenty (20) working
      days. Subject to applicable law, up to two (2) years' equivalent of
      vacation days may be accumulated provided that the Employee will take at
      least twelve (12) vacation days during the first of the two years and in
      any event accumulated vacation days cannot be converted into cash unless
      the Board of Directors establishes that the Employee's work load is such
      that it prevents the Employee to use his vacation days. Such conversion
      may be further subject to any limitations imposed under applicable
      law.

              


      

       

      
        	
                2.4.  

              	
                Manager's
      Insurance. The Companies shall contribute up to an aggregate of
      15.83% of the Salary to an accepted Manager's Insurance Policy or Pension
      fund  (the "Policy"), including
      insurance in the event of loss of capacity for work, of which (i) 8.33% of
      the Salary will 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 Manager's Insurance
      Policy or pension fund payments; and (iii) up to 2.5% of the Salary on
      account of disability pension payments. The Companies 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 Policy will be subject to an automatic
      transfer of ownership to Employee and to recive all funds accumulated in
      the above funds upon termination of Employee's employment with the
      Companies, except for such
      payments accrued with respect to severance
  compensation.

              


      

       

      
        	
                2.5.  

              	
                Annual Recreation
      Allowance (Dme'i Havra'a). The Employee shall be entitled to annual
      recreation allowance according to applicable
  law.

              


      

       

      
        	
                2.6.  

              	
                Vocational
      Studies.
      The Companies and the Employee shall maintain a "Keren Hishtalmut"
      fund for the benefit of the Employee (the "Fund"). The Companies
      shall contribute to such Fund an amount equal to 7.5% of the Salary and
      the Employee shall contribute to the Fund an amount equal to 2.5% of the
      Salary. The Employee hereby instructs the Companies to transfer to the
      Fund the Employee's payment and the Companies' contribution from the
      Salary.

              


      

       

      
        	
                2.7.  

              	
                Cellular Phone.
      The Companies shall provide the Employee a cellular phone and cover its
      expenses. The Company shall bear any and all taxes applicable to the
      Employee in connection with said cellular phone and the use thereof, in
      accordance with income tax regulations applicable
  thereto.

              


      

       

      
        	
                2.8.  

              	
                Company Car.
      The Companies shall provide the Employee with a Class 4 company car of the
      Employee’s choosing (subject to availability at the leasing company with
      the Companies are engaged), leased under an operating leasing agreement
      (the "Company
      Car") and in accordance with the Companies' policy. 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 Companies' rules relating to
      the Company Car are strictly, lawfully and carefully
    observed.

              


      

       

      Subject
to applicable law, the Companies 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 violations of law, which shall be paid
solely by Employee. The Companies shall bear any and all taxes applicable to the
Employee in connection with said Company Car and the use thereof, in accordance
with income tax regulations applicable thereto.

       

      Upon: (i)
the date of termination of the Notice Period (as defined below); or (ii) the
date of actual termination of employment in the event of termination for Cause,
then the Employee shall return the Company Car (together with its keys and any
other equipment supplied and/or installed therein by the Companies and any
documents relating to the Company Car) to the Companies' principal office.
Employee shall have no rights of lien with respect to the Company Car and/or any
of said equipment and documents.

       

      
        	
                2.9.  

              	
                Expenses.  The Employee
      shall be entitled to receive reimbursement of all business expenses
      reasonably incurred by him in connection with the performance of his
      duties hereunder against presentation of invoices. In addition, the
      Companies shall bear reasonable lodging and travel expenses incurred by
      the Employee during his travel abroad at the Companies'
      request.

              


      

       

      
        	
                2.10.  

              	
                Additional
      Incentives. The Employee shall be entitled to the following
      additional compensation:

              


      

       

      
        	
                2.10.1.  

              	
                Fund raising:
      in case of fund raising commencing January 31, 2010 in aggregate sum of
      $10,000,000 or more by the Employee (that includes equity, convertible
      loans, bonds, but excludes loans from financial institutions and grants
      under the auspices of the Ministry of Industry, Trade and Labor, such as
      Chief Scientist grants and bi-national funds), the Employee will be
      entitled for a one-time compensation of 1% of funds raised (except for
      funds raised from any current stockholder in the Companies), but not more
      than $100,000. Such compensation will be paid to the Employee by either
      of: cash, if the fundraising included at least $5,000,000 in equity, or
      otherwise in equivalent worth in stock options of the Parent. In the event
      that payment shall be in stock options of the Parent, the determination of
      the aggregate value of such
      securities shall be determined by an independent financial advisor
      acceptable to the Parties.

              


      

       

      
        	
                2.10.2.  

              	
                Options.  Employee
      shall be personally granted an option to purchase 450,000 shares of Common
      Stock of the Parent pursuant to the Parent's Employee Stock Option Plan
      (the "Option").
      80,000 stock options will serve as a signature grant and will be fully
      vested on the day of grant, and additional 370,000 stock options that will
      vest at a rate of 23,125 stock options at the end of each calendar quarter
      from the Effective Date for four years, provided however
    that:

              


      

      
        	
                 
      

              	
                -
      80,000 of the options will be accelerated and vest immediately if the last
      patient’s induction treatement in the Phase I/IIa ovarian cancer clinical
      trial is completed by November 30,
2010.

              


      

      
        	
                 
      

              	
                -
      80,000 of the options will be accelerated and vest immediately if the last
      patient’s induction treatement in the Phase I/IIa pancreatic cancer
      clinical trial is completed by November 30,
  2010.

              


      

      
        	
                 
      

              	
                -
      90,000 of the options will be accelerated and vest immediately when a new
      Phase II clinical trial is
commenced.

              


      

      
        	
                 
      

              	
                -
      60,000 of the options will be accelerated and vest immediately when a
      strategic collaboration is achieved, with a down payment of at least $5
      million.

              


      

      
        	
                 
      

              	
                -
      60,000 of the options will be accelerated and vest immediately when
      treatment is commenced in a clinical trial of the Company, of a product -
      candidate other than BC-819.

              


      

       

      Accelerated
options, where applicable, will vest in lieu of options otherwise scheduled to
vest at the end of the overall vesting period. The exercise price will be the
average closing price of the Parent’s shares on the Tel Aviv Stock Exchange
during the 22 trading days prior to the Effective Date. The option exercise
period will be 10 years from date of grant of the Option. The Option shall be
granted pursuant to the terms and conditions of the Parent's 2007 Employee Stock
Option Plan and an option agreement to be executed between the
Parties.

       

      
        	
                2.11.  

              	
                The
      Employee will be entitled that the Salary and other payments and benefits
      to which the Employee is entitled hereunder shall be reviewed annually by
      the Board of Directors during the term of this Agreement. Nothing in this
      Section 2.11 shall be deemed as conferring upon the Employee any right for
      improving the terms of his employment
hereunder.

              


      

       

      
        	
                3.  

              	
                Proprietary
      Rights

              


      

       

      
        	
                3.1.  

              	
                The
      Employee agrees and declares that any and all products, improvements,
      derivations, materials, processes, techniques, know-how and/or proceeds
      and any and all inventions, ideas, discoveries, concepts, works of
      authorship, designs, data results or initiatives conceived, conducted,
      developed, reduced to practice, compiled, created, written, authored, made
      and/or produced by the Employee, alone or jointly with others, pursuant
      to, in connection with, resulting or arising from this Agreement and/or
      his employment with the Companies, or using equipment, supplies,
      facilities or trade secrets of the Companies, whether within the scope of
      his employment with the Companies or otherwise and whether during the term
      of this Agreement, prior thereto or thereafter, directly or indirectly
      related to the field of business of the Companies as currently conducted
      and/or proposed to be conducted (the "Inventions"), and any
      and all right, title and interest in and to the Inventions, including
      without limitation, all patents, copyrights, trademarks, trade names,
      moral rights and other intellectual, industrial and/or proprietary rights
      and applications, extensions and renewals thereof (together with the
      Inventions, the "Proprietary Rights"),
      shall be the sole and exclusive property of the Companies, its successors
      and assigns (for the purpose of this Section 3, collectively, the "Companies"), and that
      the Employee will not have any rights or title whatsoever thereto. All
      works authored by the Employee pursuant to this Agreement, including,
      without limitation, the Inventions, shall be deemed "works made for
      hire".

              


      

       

      
        	
                3.2.  

              	
                If
      and to the extent the Companies' sole and exclusive ownership of the
      Proprietary Rights, in whole or in part, is not recognizable for any
      reason whatsoever, the Employee hereby irrevocably transfers and assigns
      to the Companies, solely and exclusively, all his rights, title and
      interest now and hereafter acquired in and to all Proprietary Rights
      (without any payments, liabilities or restrictions to any person or third
      party) in any and all media now known or hereafter devised, and all claims
      and causes of action of any kind with respect to any of the foregoing,
      throughout the world in perpetuity, and, when not otherwise assignable
      herein, agrees and undertakes to assign in the future to the Companies all
      right, title and interest in and to any and all such Proprietary Rights
      (and all proprietary rights with respect thereto) and further undertakes
      to execute all necessary documentation and take all further action as may
      be required in order to perform such assignment, at the Companies'
      expense.

              


      

       

      
        	
                3.3.  

              	
                In
      the event that pursuant to any applicable law the Employee retains any
      rights in and to the Proprietary Rights that cannot be assigned to the
      Companies, the Employee hereby unconditionally and irrevocably waives the
      enforcement of all such rights, and all claims and causes of action of any
      kind with respect to any of the foregoing and agrees, at the request and
      expense of the Companies, to consent to and join in any action to enforce
      such rights and to procure a waiver of such rights from the holders of
      such rights, if any.

              


      

       

      
        	
                3.4.  

              	
                In
      the event that the Employee retains any rights in and to Proprietary
      Rights that cannot be assigned to the Companies and cannot be waived, the
      Employee hereby grants the Companies an exclusive, perpetual, worldwide,
      royalty-free license to exploit, use, develop, perform, modify, change,
      reproduce, publish and distribute, with the right to sublicense and assign
      such rights, and all claims and causes of action of any kind with respect
      to any of the foregoing, in and to the Proprietary Rights, in any way the
      Companies sees fit and for any purpose whatsoever. Without derogating from
      the above, the Employee hereby forever waives and agrees never to assert
      any and all rights of paternity or integrity, any right to claim
      authorship of any Invention, to object to any distortion, mutilation or
      other modification of, or other derogatory action in relation to any
      Invention, whether or not such would be prejudicial to his honor or
      reputation, and any similar right, existing under judicial or statutory
      law of any country in the world, or under any treaty, even after
      termination of his work on behalf of the
  Companies.

              


      

       

      
        	
                3.5.  

              	
                Without
      derogating from the above, any and all material (including, without
      limitation, software, designs, documentation, memoranda, notes, reports,
      manuals, patterns, programs, specifications, prototypes, formulas,
      drawings, records, data or other technical or proprietary information),
      and any copies or abstracts thereof, whether or not of a secret or
      confidential nature, furnished to the Employee by the Companies or
      conceived, conducted, developed, reduced to practice, compiled, created,
      written, authored, made and/or produced by the Employee, alone or jointly
      with others, pursuant to, in connection with, resulting or arising from
      this Agreement and/or his employment with the Companies, or using
      equipment, supplies, facilities or trade secrets of the Companies, whether
      within the scope of his employment with the Companies or otherwise and
      whether during the term of this Agreement, prior thereto or thereafter,
      directly or indirectly related to the field of business of the Companies
      as currently conducted and/or proposed to be conducted, is and shall
      remain the sole and exclusive property of the Companies. Such property
      while in the Employee's custody or control shall be maintained in good
      condition at the Employee's
expense.

              


      

       

      
        	
                3.6.  

              	
                The
      Employee will promptly disclose to the Companies fully and in writing all
      Inventions, if any.

              


      

       

      
        	
                3.7.  

              	
                The
      Employee hereby agrees and undertakes to provide the Companies or any
      person designated by the Companies all such information, to execute all
      necessary documentation and to take all further action as may be required
      to perfect the rights referred to herein, including, without limitation,
      any assignment of rights to the Companies or the obtaining or enforcing
      any intellectual property rights, if applicable, in any and all countries
      at the Companies' expense. Without derogating from any of the Employee's
      obligations hereunder, the Employee hereby appoints any officer of the
      Companies as its duly authorized agent to execute, file, prosecute and
      protect the same before any government agency, court or authority at the
      Companies' expense.

              


      

       

      
        	
                3.8.  

              	
                The
      Employee's undertakings in this Section 3 shall remain in full force and
      effect after termination or expiration of this Agreement for any reason
      whatsoever or any renewal thereof.

              


      

      


       

      
        	
                4.  

              	
                Non-Competition

              


      

       

      
        	
                4.1.  

              	
                The
      Employee agrees and undertakes that he will not, without the express
      written consent of the Company, during the period of his employment with
      the Companies, and for a period of one (1) year thereafter, compete or
      assist others to compete, whether directly or indirectly, with the
      business of the Companies, as currently conducted and/or as proposed to be
      conducted at the time of termination of
  employment.

              


      

       

      
        	
                4.2.  

              	
                The
      Employee further agrees and undertakes that during the period of his
      employment with the Companies and for a period of one (1) year thereafter,
      he will neither solicit for employment or any other engagement nor employ
      or otherwise engage any person employed by the Companies on the date of
      such termination or during the preceding twelve (12) months, personally or
      in any business in which he is an officer or director, for any purpose or
      in any place.

              


      

       

      
        	
                4.3.  

              	
                If
      any one or more of the terms contained in this Section 4 shall, for any
      reason, be held to be excessively broad with regard to time, geographic
      scope or activity, such term shall be construed in a manner to enable it
      to be enforced to the extent compatible with applicable
    law.

              


      

      


       

      
        	
                5.  

              	
                Confidentiality

              


      

       

      
        	
                5.1.  

              	
                The
      Employee represents and warrants that he will keep the terms and
      conditions of this Agreement strictly confidential and will not disclose
      it or provide a copy of this Agreement or any part thereof to any third
      person unless and to the extent required by applicable
  law.

              


      

       

      
        	
                5.2.  

              	
                Any
      and all information and data of a proprietary or confidential nature
      concerning the business or financial activities of the Companies or its
      technology, or products (whether current or future), whether in oral,
      written, graphic, machine-readable form, or in any other form, including,
      without limitation, proprietary, business, financial, technical,
      development, product, marketing, sales, price, operating, performance,
      cost, know-how and process information, trade secrets, patents, patent
      applications, copyrights, ideas and inventions (whether patentable or
      not), and all record bearing media containing or disclosing such
      information and techniques, disclosed to or otherwise acquired by the
      Employee in connection with this Agreement and/or his employment with the
      Companies and any and all Proprietary Rights (collectively, "Confidential
      Information") is and shall remain the sole and exclusive property
      of the Companies.

              


      

       

      
        	
                5.3.  

              	
                During
      the term of this Agreement and thereafter, the Employee (i) will keep the
      Confidential Information strictly confidential and will not disclose it,
      or any part thereof, provide any documentation with respect thereto, or
      any part thereof, directly or indirectly, to any third party, without the
      prior written consent of the Companies or unless and to the extent
      required by applicable law; and (ii) the Employee will not use any
      Confidential Information or anything relating to it without the prior
      written consent of the Companies, except and to the extent as may be
      necessary in the ordinary course of performing his duties and obligations
      hereunder and in the best interests of the Companies. Notwithstanding the
      foregoing, the Employee shall not be obligated to maintain the
      confidentiality of the Confidential Information which: (i) is or becomes a
      matter of public knowledge through no fault of the Employee; (ii) is
      authorized, in writing, by the Companies for release; (iii) was lawfully
      in the Employee's possession before receipt from the Companies, as
      evidenced by the Employee through written documentation; (iv) is lawfully
      received by the Employee from a third party without a duty of
      confidentiality; or (v) reflects information and data generally known
      within the industries or trades in which the Companies transacts
      business.

              


      

       

      
        	
                5.4.  

              	
                At
      all times, both during the term of this Agreement and thereafter, the
      Employee will keep in trust all Confidential Information. In the event of
      the expiration or other termination of this Agreement for any reason, or
      upon the Companies' earlier request, the Employee will promptly deliver to
      the Companies all materials referred to herein and the Employee shall not
      retain or take any materials, or any reproduction thereof containing or
      pertaining to Confidential
Information.

              


      

       

      
        	
                5.5.  

              	
                The
      Employee recognizes that the Companies received and will receive
      confidential or proprietary information from third parties, subject to a
      duty on the Companies' part to maintain the confidentiality of such
      information and to use it only for certain limited purposes. At all times,
      both during his employment and after its termination, the Employee
      undertakes to keep any and all such information in strict confidence and
      trust, and he will not use or disclose any of such information without the
      prior written consent of the Companies, except as may be necessary to
      perform his duties hereunder and consistent with the Companies' agreement
      with such third party. Upon termination of his employment with the
      Companies, Employee shall act with respect to such information as set
      forth in Section 5.4.

              


      

       

      
        	
                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 as hereinafter
provided.

              


      

       

      
        	
                6.2.  

              	
                This
      Agreement may be terminated by either Party by ninety (90) days prior
      written notice to the other Party. Any such prior notice period shall be
      referred to as the "Notice Period", as
      applicable. At any time during the Notice Period, the Companies 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, including use of the Company Car until the end of the
      Notice Period.

              


      

       

      
        	
                6.3.  

              	
                Notwithstanding
      anything to the contrary herein, the Companies may terminate this
      Agreement at any time, effective immediately, without need for prior
      written notice, and without derogating from any other remedy to which the
      Companies may be entitled, for Cause. For the purposes of this Agreement,
      the term "Cause"
      shall mean, but shall not be limited to: (i) a material breach by Employee
      of any term of this Agreement; (ii) any breach by Employee of his
      fiduciary duties to the Companies, including, without limitation, any
      material conflict of interest for the promotion of Employee's benefit;
      (iii) Employee's fraud, felonious conduct or dishonesty; (iv) Employee's
      embezzlement of funds of the Companies; (v) any conduct by Employee which
      is materially injurious to the Companies, monetary or otherwise; (vi)
      Employee's conviction of any felony; (vii) Employee's misconduct, gross
      negligence or willful misconduct in performance of his duties and/or
      responsibilities hereunder; or (viii) Employee's refusal to perform his
      duties and/or responsibilities hereunder for any reason other than illness
      or incapacity, or Employee's disregard or insubordination of any lawful
      resolution and/or instruction of the Board of Directors or executive
      management of the Companies with respect to Employee's duties and/or
      responsibilities towards the
Companies.

              


      

       

      
        	
                6.4.  

              	
                The
      Employee shall cooperate with the Companies and use his best efforts to
      assist the integration into the Companies' organization of the person or
      persons who will assume the Employee's responsibilities. At the option of
      the Companies, the Employee shall, during such period, either continue
      with his duties or remain absent from the premises of the Companies,
      subject to applicable law.

              


      

       

      
        	
                6.5.  

              	
                Upon
      termination of Employee's employment with the Companies hereunder, for any
      reason whatsoever, the Companies shall have no further obligation or
      liability towards the Employee in connection with his employment as
      aforesaid, other than payment of the Salary earned pursuant to the terms
      of this Agreement prior to the date of termination in accordance with
      Section 2 above and the social benefits. Any outstanding payment due by
      the Employee to the Companies in connection with his employment by the
      Companies shall be repaid by the Employee no later than one (1) month
      following termination of his employment. Notwithstanding, the Companies
      may offset any such outstanding amounts due to it against any payment due
      by the Companies to the employee, subject to applicable
    law.

              


      

       

      
        	
                6.6.  

              	
                The
      provisions of Sections 3, 4 and 5 shall survive the termination or
      expiration of this Agreement for any reason whatsoever or any renewal
      thereof.

              


      

       

      
        	
                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 Companies:

              	
                BioCancell
      Therapeutics Inc.

                8
      Hartom St. Har Hotzvim, Jerusalem

              
	
                If
      to the Employee:

                 

              	
                Uri
      Danon

                Mavo
      Ganigar 8, Tel Aviv, 69359, Israel

                 

              


      

       

      
        	
                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: (i) if sent by facsimile or email, upon transmission and
      electronic confirmation of receipt or (if transmitted and received on a
      non-business day) on the first business day following transmission and
      electronic confirmation of receipt, (ii) if sent by registered mail, upon
      3 (three) days of mailing, and (iii) if sent by messenger, upon
      delivery.

              


      

       

       

      
        	
                8.  

              	
                Miscellaneous.

              


      

       

      
        	
                8.1.  

              	
                Headings;
      Interpretation. Section 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 supersedes all
      prior agreements, understandings and arrangements, oral or written,
      between the Parties with respect to the subject matters
      hereof.

              


      

       

      
        	
                8.3.  

              	
                Amendment;
      Waiver. No provision of this Agreement may be modified, waived or
      discharged unless such waiver, modification or discharge is agreed to in
      writing and signed by the Employee and the Companies. 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;
      Jurisdiction. This Agreement shall be governed by and construed and
      enforced in accordance with the laws of the State of Israel, without
      giving effect to the rules with respect to conflicts-of-law. Any dispute
      arising out of, or relating to this Agreement, its interpretation or
      performance hereunder shall be resolved exclusively by the competent court
      of the Tel Aviv-Jaffa district, and each of the Parties hereby submits
      exclusively and irrevocably to the jurisdiction of such
    court.

              


      

       

      
        	
                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
      determined 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.  

              	
                Successors and Assign;
      Assignment. This Agreement shall be binding upon and shall inure to
      the benefit of the Companies, its successors and assigns. 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
      Companies, except by will or by the laws of descent and
      distribution

              


      

       

      IN
WITNESS WHEREOF, the parties hereto have executed this Employment Agreement as
of the date first above-mentioned.

       

      
        	
                BIOCANCELL
      THERAPEUTICS INC.

              	 
      	
                URI
      DANON

              
	 /s/
      Avi Barak 

                By:
      Avi Barak

              	
                /s/
      Avraham Hochberg

                Avraham Hochberg

              	 
      	 
      /s/ Uri Danon
	

                Title:
      Chief Executive Officer

              	
                Chairman
      of the Board of Directors

              	 
      	 
      


      

       

      


       

      
        	
                BIOCANCELL
      THERAPEUTICS ISRAEL LTD.

              	 
	 /s/
      Avi Barak 

                By:
      Avi Barak

              	
                

                  /s/
      Avraham Hochberg

                  Avraham Hochberg

                

              	 
	

                Title:
      Chief Executive Officer

              	
                

                  Chairman
      of the Board of Directors