EX-10-9 Unprotected Lease Contract



 





Exhibit 10.9


[Translation from Hebrew]


Unprotected Lease Contract




Made and executed in Tel Aviv this 28th October, 2003




	 	 	 
	Between:

	 	Engel Science Parks (99) Ltd.
	 

	 	66 Hahistadrut Blvd., Haifa Bay


By Yitzchak Yaacovinsky
	 

	 	The party authorized to undertake and sign in the name of the Lessor

(hereinafter: “the Lessor”)
	 

	 	of the first part
	 
	 	 
	And:

	 	Metabogal Ltd.
	 

	 	P.O.Box 432, Kiryat Shmonah, Zip code 11013

(hereinafter: “the Lessee”)
	 

	 	of the second part






	 	 	 
	WHEREAS

	 	The Lessor has contracted with the Israel Lands Administration by
agreement whereby it acquired the development rights in the plot
known as Block 18984, Parcels 187 (part of), 188 (part), 190 (part
of), 191 (part of), 192 (part of), 193 (part of), 194 (part of),
199 (part of) and 206 (part of) in Carmiel, plot/s no. 1,
according to Detailed Plan no. C/8880, in Carmiel, (hereinafter: “the Land”) all pursuant to the Development Agreement and the
Appendices thereto attached to this Agreement and marked as
(Appendix “A”); and
	 
	 	 
	WHEREAS

	 	The Lessor intends to establish a science park on the Land,
consisting of industrial buildings for leasing (hereinafter: “the
Science Park”); and
	 
	 	 
	WHEREAS

	 	The Lessor is the proprietor of development rights from the Israel
Lands Administration under a Development Agreement and is entitled
to effect transactions with the Land, including leasing buildings
that it will construct thereon, as set out below in this Agreement
and there is nothing by law or agreement or otherwise to prevent
the Lessor from entering into this Agreement; and
	 
	 	 
	WHEREAS

	 	The destination of the premises is compatible with the Purpose of
the Lease; and
	 
	 	 
	WHEREAS

	 	The Lessor declares that the Development Contract has not been
rescinded by the Israel Lands Administration and is about to be
further extended; and
	 
	 	 
	WHEREAS

	 	The Lessee is desirous to lease the Premises (as hereinafter
defined) from the Lessor under an unprotected lease according to
the Tenants Protection Laws, and the Lessor is prepared to grant
such a lease of the Premises to the Lessee, subject to all of the
conditions hereinafter contained;












 



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IT IS THEREFORE AGREED, DECLARED AND STIPULATED BETWEEN THE PARTIES AS FOLLOWS:





	1.	 	Preamble 
	 
	 	 	The preamble to this Contract and the Appendices thereto will constitute an integral part
hereof.
	 
	2.	 	Interpretation 






	 	2.1	 	The headings to the clauses in this Contract are set out for ease of reference
only and do not constitute part of the Contract nor will they be applied for purposes of
interpretation.
	 
	 	2.2	 	Save where the context or the meaning otherwise requires, everything stated in
the singular includes the plural and vice-versa, and everything stated in the masculine
includes the feminine and vice-versa.
	 
	 	2.3	 	Unless the context otherwise requires, the following words shall bear the
meanings set out opposite them when used in this Contract:





	 	 	 	 	 
	 

	 	“the Premises” -
	 	means the gross area of some 750sq.m., situated on the
ground floor of Building no. 1 of the industrial building distended to be
constructed by the Lessor and/or on its behalf, on the Land, within the boundaries
of the Science Park in Carmiel. The Premises will consist of offices according to
the specification attached, and be totally finished and have a basic
infrastructure, but be without installations and furniture.

The Premises will be constructed in accordance with plans, the
Lessor’s specification and the Lessee’s specification
respectively attached hereto as Appendices “B”, “C” and “D”.
The Lessor’s and the Lessee’s specification will be
hereinafter collectively called – “the Specification”.

The area of the Premises for the purpose of determining the
rent will be set in accordance with an actual survey
thereafter, after construction is completed.







	3	 	Term of the Lease, Purpose thereof and Non-applicability of the Tenants Protection
Laws






	 	3.1	 	Term of the Lease






	 	3.1.1	 	The Lessor hereby leases to the Lessee and the Lessee hereby takes
on lease from the Lessor the Premises for a term of 5 years, commencing on 15.2.04
and expiring on 14.2.09 (hereinafter: “the Lease Term”).
	 
	 	 	 	If and to the extent the actual delivery date is deferred by reason of that
stated in clause 5.1 hereof, the date of the commencement of the Lease Term will
be deemed to be the date of actual delivery, and the expiration date of the Lease
Term will be correspondingly deferred.










 



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	 	 	 	Subject to the agreed time schedule mentioned in clause 19.9, the Lessor will, in
respect of each day of deferral of the date of the commencement of the Lease
Term, pay the Lessee an amount equal to twice the amount of the Rent plus VAT,
calculated on a daily basis as from the date prescribed above for the
commencement of the Lease Term until the actual date of the commencement of the
Lease Term. The deferral of the date of commencement of the Lease Term by reason
of any act or omission of the Lessee will not obligate the Lessor to make such
payment and the date of the commencement of the Lease will remain unchanged.
	 
	 	3.1.2	 	Notwithstanding the foregoing in relation to the Lease Term, the
Lessee will be entitled to terminate the Lease Term by four months prior notice,
during the periods and on the following terms and conditions:






	 	3.1.2.1	 	After 3 years of the lease, against payment of the sum of NIS. 150,000
(plus VAT) in addition to the rent that has been paid in respect of such
three-year lease.
	 
	 	3.1.2.2	 	After 4 years of the lease, against payment of the sum of NIS. 75,000
(plus VAT) in addition to the rent that has been paid in respect of such
four-year lease.






	 	 	 	The sums mentioned in the above sub-clause will be linked to the residential
construction inputs index, the base index being that known on the date of the
execution of this Contract, the operative index being that which will be known on
the date of the making of the payment according to this clause.
	 
	 	3.1.3	 	The Lessee hereby undertakes to open the Premises for regular
business activity and carry on in the Premises for the entire duration of the
Lease Term, a business the purpose of which is set out below.
	 
	 	3.1.4	 	Subject clause 3.1.2 above, the cessation by the Lessee of the use
of the Premises or quitting the same prior to the expiration of the Lease Term
will not release it from fully performing its undertakings, including payment of
the rent and the remaining payments payable by it under this Contract until the
expiration of the Lease Term, except in a case where an alternative tenant is
found for the Premises whose identity has been agreed to by the Lessor, in which
case the Lessee will be released from the performance of its undertakings under
this Agreement from the date on which a contract is forged with the alternative
tenant and thereafter.
	 
	 	 	 	It is clarified that the Rent will be paid by the expiration of the Lease Term or
until an alternative tenant is found who is acceptable to and approved by the
Lessor, whichever is the earlier.
	 
	 	 	 	The Lessor’s approval will not be unreasonably withheld save that where the
Lessor will have agreed to an alternative tenant that has been found by the
Lessee, the Lessee will remain liable, jointly with the alternative tenant, for
the performance of the undertakings under this Agreement.










 



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	 	3.2	 	Purpose of the Lease
	 
	 	 	 	The Lessee hereby leases the Premises for the management of a business in the field of
biotechnology including the management of biotechnology laboratories, research,
development and production of medications and the Lessee is prohibited from making any
other use whatsoever of the Premises.
	 
	 	3.3	 	Non-applicability of the Tenants Protection Laws 






	 	3.3.1	 	There was no tenant entitled to occupy the Premises on the date of
the commencement of the Tenants Protection Law (Consolidated Version), 5732-1972.
	 
	 	3.3.2	 	The Lessee hereby declares that it has not been requested to pay nor
has it paid any key money or payments which could be construed as key money and
that all the works, alterations, improvements and enhancements that will be made
in the Premises, if at all, are not and will not be fundamental alterations and
further that the provisions of Part Three of the Tenants Protection Law
(Consolidated Version), 5732-1972 dealing with key money, will not apply to the
Contract.
	 
	 	3.3.3	 	The Lease, the Lessee and the Premises are not protected according
to the provisions of the Tenants Protection Law (Consolidated Version), 5732-1972
nor according to the provisions of any other law protecting tenants or occupiers
in any manner whatsoever and such Laws as amended and the regulations promulgated
now or hereafter thereunder do not and will not apply to the building and/or the
Lease and/or the Lessee and/or the Premises and/or this Contract.
	 
	 	3.3.4	 	The Lessee will not be entitled, when quitting the Premises, to any
payment whatsoever either in the form of key money or in any other form.
	 
	 	3.3.5	 	For the avoidance of any doubt the Lessee hereby declares and
warrants that if in the future any claims are raised to the effect that the
engagement under this Contract is protected according to the Tenants Protection
Law or any other law, the Lessee will compensate the Lessor in respect of any
damage that will be incurred by it, including the difference between the value of
the property at the expiration of the Lease Term as occupied, and the value
thereof in the open market, as vacant property.






	4.	 	Rent






	 	4.1	 	The Lessee undertakes to pay the Lessor monthly rent pursuant to the following
conditions and dates:






	 	4.1.1	 	The Lessee will pay for the duration of the Lease Term the sum of $9
per month for each sq.m., of the area of the Premises.
	 
	 	4.1.2	 	The parties agree that in respect of each 11-month period of the
Lease, the Lessee will be exempt from paying rent for one month. The month of the
Lease without payment of the rent will be granted in relation to each year of the
Lease, in the seventh month of the Lease, that is to say – in each year of










 



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	 	 	 	the Lease the Lessee will be exempt from payment of rent in respect of the period
between 15.4 – 14.5.






	 	4.1.3	 	The Lessee will deduct from the rent, amount mentioned, tax at
source as required by law, unless the Lessor produces to the Lessee a lawful
certificate regarding the exemption from deduction of tax at source.






	 	 	 	VAT will be added to the above rent against a lawful VAT receipt, at the rate in force
on the date on which each payment is made.
	 
	 	4.2	 	Payment of the rent will be made in new shekels according to the representative
rate of exchange of the dollar on the date on which each payment will be made pursuant
to the publications of the Bank of Israel.
	 
	 	4.3	 	Deleted.
	 
	 	4.4	 	The rent will be paid in quarterly installments in advance, on the
15th of each month of February, May, August, November.
	 
	 	4.5	 	Deleted.
	 
	 	4.6	 	Arrears in payment of the rent as well as arrears in any other payment imposed
upon the Lessee under this Contract exceeding 14 (fourteen) days, will constitute a
fundamental breach of this Contract.
	 
	 	4.7	 	Every sum which the Lessee is liable to pay under this Contract and which will
not have been paid on due date will bear interest on arrears at the maximum rate
customary for the time being in Bank Leumi le-Israel B.M., with respect to overruns of
unauthorized credit, from the date prescribed for payment under this Contract until the
date of actual payment, together with VAT as required by law. The interest rates will
vary during the period of the arrears in accordance with changes occurring from time to
time in the interest customary in Bank Leumi as stated. Nothing contained in this clause
shall derogate from any relief or other right conferred upon the Lessor according to the
provisions of this Contract or at law. In respect of the first three days of arrears, no
interest on arrears as stated above will be payable.






	5.	 	Acceptance of the Premises 






	 	5.1	 	The Lessor will place the Premises at the Lessee’s disposal in accordance with
the Execution Plans (as hereinafter defined) and the Specification attached hereto,
complete with connection to the electricity and water supply and after having duly
received a certificate from the Electric Corporation and the Lessee undertakes to accept
the same in such condition.
	 
	 	 	 	As part of the Lessor’s undertakings it undertakes to allocate to the Lessee, for the
duration of the actual Lease Term, 20 parking places adjacent to the entrance to the
Premises.
	 
	 	5.2	 	It is hereby agreed that by no later than 15.11.03, the parties will confirm in
writing the detailed Execution Plans in respect of the works that will be carried out by
the Lessor at the Premises (in this Agreement referred to as: “the










 



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	 	 	 	Execution Plans”). The Execution Plans will be prepared based on the plans contained in
Appendix “B” to the Contract by and at the expense of the Lessor, except for plans in
respect of the Lessee’s dedicated purposes and any planning in excess of the Lessor’s
Specification will be borne by the Lessee. The Lessor’s Specification and the Lessee’s
Specification will be delivered to the Lessee at least 7 days prior to the date of the
approval thereof as stated above.



The Lessor will provide the Lessee with an assessment of the cost
differentials prior to commencing execution.
	 
	 	 	 	For the avoidance of any doubt it is hereby emphasized that the Lessor will not be
required to execute any work or alteration or improvement whatsoever in the Premises,
in addition to its undertakings in the Execution Plans and the Specification.
	 
	 	5.3	 	The parties agree that a delay of up to three months in the completion of the
development works surrounding the Premises does not constitute a breach of this
Agreement or a cause for any delay/refusal of the delivery of the Premises and/or the
taking of the possession thereof, all on the condition that the Lessee will be able to
make actual use of the Premises.
	 
	 	5.4	 	The parties will, 7 days prior to delivery of possession of the Premises, make a
memorandum of delivery within the scope of which the Lessee will itemize all the defects
and deficiencies in the Premises. The Lessor will rectify or make good, as appropriate,
everything that requires repair and completion by the date of the delivery of
possession.






	6.	 	Additional payments to be borne by the Lessee 






	 	6.1	 	The Lessee undertakes, in addition to the rent and the VAT, to pay all the taxes,
fees, levies and compulsory payments applicable now or hereafter to the Premises and/or
to the use thereof during the Lease Term including general municipal taxes and business
tax as well as expenses for the use of electricity, gas and telephone, and all the
remaining maintenance expenses of the Premises in the area of the Premises only
(including maintenance and cleaning) as well as the facilities serving the Premises,
(such as elevators, air-conditioning, fire-fighting systems and the like).
	 
	 	 	 	It is clarified that all the above payments and any other payment applicable to the
Premises or the construction thereof (including property tax, amelioration levies
and/or sewerage, drainage and water fees), as well as any payment in respect of the
period culminating with the date of the delivery of the possession to the Lessee, will
be borne and paid for by the Lessor.
	 
	 	 	 	The Lessee undertakes to transfer the municipal tax bill in respect of the Premises
into its name immediately after taking actual possession of the Premises.
	 
	 	 	 	It is clarified and agreed that the Lessee will also be liable for a proportionate
share equal to the floor area of the Premises compared with the total floor area of the
building in which the Premises are situated, of the cost of maintaining the common
areas for the building.










 



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	 	 	 	It is clarified that the Lessee will bear the maintenance costs of the Premises
including all the installations and systems that are situated within the area of and
serve the Premises.
	 
	 	6.2	 	The Lessee will be liable also after the termination of the Lease Term, for the
payments mentioned in this clause above if the liability has been created following the
use or consumption made during the currency of the Lease Term, even if the liability or
the demand for payment has arrived after the expiration of the Lease Term.
	 
	 	6.3	 	The Lessee will pay the payments mentioned in this clause above immediately when
they fall due.
	 
	 	6.4	 	The parties will, on the date of the delivery of possession of the Premises, make
an accounting with respect to the alterations, additions and/or reductions that have
actually been made at the Premises compared with the Lessor’s Specification (Appendix
“C”) and which will be priced according to the full price thereof according to the Dekel
price list. The amount due to either of the parties following such accounting will be
paid by way of a reduction or addition to the first quarterly payment of the rent as
appropriate.
	 
	 	6.5	 	In the event of the Lessor making any payment which, by the provisions of this
Contract, is payable by the Lessee, the Lessee will be bound to pay the Lessor such
payment immediately upon the Lessor’s first demand, with the addition of exchange rate
differentials (if any) plus interest on arrears according to clause 9.2 hereof, computed
from the date of the making of the payment by the Lessor until the actual payment
thereof to the Lessor provided the Lessor has given 14 days’ advance notice of its
intention to make the payment and the Lessee has failed to pay the same.






	7.	 	Possession of the Premises during the Lease Term 






	 	7.1	 	The Lessee will keep the Premises in good and proper condition, keep the Premises
tidy and clean including the surroundings, installations and fittings thereof, and use
the same cautiously and carefully and fulfil the instructions of any competent authority
as they exist from time to time in connection with arrangements regarding cleanliness,
the removal of waste garbage, and keeping the drainage system and all the remaining
systems at the Premises in order.
	 
	 	7.2	 	The Lessee will repair at its own expense, any defect, malfunction or fault that
will be caused or come about or be discovered in the Premises and in any part thereof
belonging to the Lessee, including plumbing and various other repairs when they arise
and/or have been caused or discovered, except for repairs or damages that have been
caused by reason of fair wear and tear following the reasonable use of the Premises
and/or as a result of construction and/or infrastructure defects (including sewage,
electricity, water) in the construction of the Premises, the responsibility for which
will apply to the Lessor.
	 
	 	 	 	Repairs which are the Lessor’s responsibility will be repaired by it, failing which
they will be executed by the Lessee after notices as set out in this clause will have
been given, mutatis mutandis.










 



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	 	7.3	 	If the need to make a repair arises that a party is responsible to fix according
to clause 7.2 above, the party liable for the repair will be bound to carry out the same
at its own expense, within a reasonable time of the date of discovery. Failure by the
party liable to carry out the repair will entitle the other party, that is not liable,
to carry out the same after giving 30 days’ prior written notice and all the repair
expenses will be borne by the party liable, who shall be under an obligation to
reimburse the party actually carrying out the repair for expenses, immediately upon
first demand with the addition of linkage differentials and interest on arrears
according to clause 9.2 hereof, computed from the date of payment for the repair until
the actual payment thereof, to the repairing party. Notwithstanding the foregoing it is
agreed that in the event of an urgent repair, the party entitled may carry out the same
after giving 24 hours’ prior notice to the other party.
	 
	 	7.4	 	The Lessee undertakes to comply with the provisions of any law including any Law,
Regulation, Order, By-law or instruction of any competent authority pertaining to the
management of its business at the Premises and in connection with the maintenance of the
Premises and the use thereof. The Lessee will also be responsible for paying any fine
that will be imposed following the failure to fulfil such instructions.
	 
	 	7.5	 	The Lessee undertakes not to effect any internal or external alteration at the
Premises nor make any addition thereto nor demolish any part of the Premises or any of
the installations thereof nor suffer any such alterations or additions or repairs or
demolition, to be made, without receiving the prior written consent of the Lessor, which
consent shall not be unreasonably withheld by the Lessor.
	 
	 	 	 	It is clarified that this clause will not apply to works at the Premises that will be
carried out by the Lessee or any person on its behalf within the scope of the “clean
room” installation in that part of the Premises that is designated for production.
	 
	 	7.6	 	It is expressly agreed that signage and advertising will only be made by
arrangement with the Lessor (including the architect of the building in which the
Premises are situated) and with its prior consent only, which consent will not be
unreasonably withheld by the Lessor.
	 
	 	7.7	 	Alterations made to the Premises with the Lessor’s consent, will require the
Lessee, at the end of the Lease Term, to reinstate the Premises to its former condition
before the alterations were made, or leave the same in its condition, all as decided and
notified by the Lessor. Upon such agreement by the Lessor being given to the alterations
remaining, the Lessee may not remove from the Premises or reinstate the alterations or
any part thereof that the Lessor has required remain at the Premises or make any
alteration therewith, and the alterations will, at the end of the Lease Term, pass into
the Lessor’s ownership and possession, without the Lessee being able to demand and/or
receive any compensation or payment for them.
	 
	 	7.8	 	The Lessor and each of its managers may enter upon the Premises by prior
arrangement, at any reasonable time acceptable in order to check the condition of the
Premises and carry out repairs, works, technical or other arrangements for the Premises
all this without unreasonably effecting the Lessee’s activity at the Premises.










 



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	 	 	 	Nothing herein contained shall impose any duty whatsoever on the Lessor to carry out
anything which is mentioned in this Contract.
	 
	 	7.9	 	The Lessor will independently install, at its own expense, fire fighting and
safety measures as appearing in the plans and Specifications attached hereto as
Appendices “B” and “C”.
	 
	 	 	 	The Lessee will, at its own expense, fulfil the instructions of any competent authority
relating to the fire fighting arrangements and procedures, fire prevention, civil
defense and safety, to the extent these will be required in relation to the Premises
and the use made thereof, over and above those measures which will be installed by the
Lessor.






	8.	 	Assignment of rights 






	 	8.1	 	The Lessee undertakes to use the Premises personally only or with its employees
and the Lessee will be prohibited from authorizing any other person or persons to use
the Premises or any part thereof for consideration or otherwise, directly or indirectly.
	 
	 	8.2	 	The Lessee undertakes not to transfer and/or assign and/or convey and/or pledge
and/or charge in any manner whatsoever, without first receiving the written consent of
the Lessor (if and to the extent it will be granted) this Contract and/or any right
thereunder to any other party or parties, nor grant any leases of the Premises or any
part thereof by sub-lease or convey possession or use thereof or any part thereof to any
other person or persons for consideration or otherwise, in any manner whatsoever. Any
transfer and/or assignment and/or conveyance and/or pledge and/or charge that will be
made by the Lessee contrary to that stated above will be null and void ab initio and
devoid of any effect.
	 
	 	8.3	 	Notwithstanding the foregoing the Lessee will be entitled to share the use of the
Premises under this Agreement or sub-lease parts thereof to a parent, subsidiary or
affiliated company of the Lessee (as these terms are defined in the Companies Law, 1999)
without the need to obtain the Lessor’s consent provided that the Lessee will remain
liable for all its obligations under this Agreement.






	9.	 	Breaches and remedies
	 
	 	 	This Contract will be governed by the provisions of the Contracts (Remedies for Breach of
Contract) Law, 5731-1970 and the provisions of the Contracts (General Part) Law, 5733-1973.
	 
	10.	 	Licensing and Licences






	 	10.1	 	The Lessee hereby undertakes to obtain any licence it requires and ensure that
the business is carried on according to every licence that is required by law, including
from any municipal, governmental, local or other authority, for the purpose of operating
and managing the Lessee’s business at the Premises.
	 
	 	 	 	The Lessor will sign any document that will be required by the landlord [sic] in order
to obtain a business licence, but does not deviate from the conditions of this










 



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	 	 	 	Agreement, within and by no later than 14 days after delivery thereof for signature to
the Lessor.
	 
	 	10.2	 	The Lessee shall ensure that throughout the entire Lease Term the licences and
approvals required in order to carry on and operate its business mentioned, will be
renewed.
	 
	 	10.3	 	For the avoidance of any doubt the Lessor is not responsible towards the Lessee
for obtaining licences or approvals from any authority except where failure to obtain
receipt of the licence results from any act or omission of the Lessor or of any person
on its behalf and where a duty attaches to the Lessor by law and/or this Agreement to
carry out or refrain from carrying out such act, as appropriate.
	 
	 	 	 	Without derogating from the Lessee’s undertaking mentioned above, the Lessor declares
that the Premises comply with the zoning thereof according to the Town Building Plan in
force in respect of the Land.






	11.	 	Insurance






	 	11.1	 	The Lessee hereby undertakes to insure at its own expense for the duration of the
Lease Term, the building of the Premises and the contents thereof against:






	 	11.1.1	 	Fire, explosion, earthquake risks.
	 
	 	11.1.2	 	Flooding, water damage of any kind.






	 	11.2	 	The Lessee hereby undertakes to insure at its own expense, for the duration of
the Lease Term, its activity at the Premises, with the following insurances:






	 	11.2.1	 	Third party liability insurance with liability limits that will not be less
than the amount equal to US$1,000,000 Million per event, and in the aggregate for
the insurance period, which will endure for the duration of the Lease Term.
	 
	 	11.2.2	 	Employers’ liability insurance.

The Lessee further undertakes to maintain at its own expense for the duration
of the Lease Term loss of rent insurance following the Premises being taken out
of use by reason of damage that has been caused thereto or to the contents
thereof by the risks set out in clause 11.1 above, for an indemnity period of
12 months. This insurance may be made by means of extending the fire insurance
policy to cover loss of rent.






	 	11.3	 	The Lessee undertakes to add the Lessor’s name as an additional insured in the
policies mentioned above.
	 
	 	11.4	 	The Lessee will produce to the Lessor upon demand, all the insurance policies
which have been issued as required by this Contract and also produce to the Lessor on a
regular basis every new policy that has been issued to it or any amendment thereto. The
Lessee will, upon the Lessor’s reasonable demand, add to or update and/or amend the
insurance policies to the Lessor’s satisfaction in order to comply with the criteria
prescribed in this clause 11, and the amounts will in any event be linked to the Index
each year.











 



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	 	11.5	 	The Lessee will cause an express condition to be added to the insurance policy
whereby the insurer expressly waives any right of subrogation or other right under any
law to have recourse against the Lessor in a claim of subrogation or repayment or
indemnity in respect of direct or indirect damage that has been caused by reason of the
Lessor, if any such damage is caused.
	 
	 	11.6	 	The Lessor’s right of inspection and its exercise or right to refrain from
exercising its right to view the policies and demand any update, addition or change as
set out in clause 11.1 above, will not impose upon it any liability whatsoever with
respect to the policies, or the nature and validity thereof, or with respect to the
absence thereof.
	 
	 	11.7	 	The Lessee undertakes to comply with all of the conditions of the policies
mentioned above in this clause, punctually pay the insurance premiums and ensure that
the policies are renewed and remain in full force for the entire duration of the Lease
Term. Failure to renew the policies in the full value thereof, including linkage to the
Index for any reason whatsoever will constitute a fundamental breach of this Contract.
	 
	 	11.8	 	The policy will include a clause determining that it will not be varied,
cancelled or renewed without at least 30 days’ prior notice being given to the Lessor.






	12.	 	Liability of the Lessee 






	 	12.1	 	The Lessor, its agents and any person acting in its name and on its behalf will
not be responsible in any manner whatsoever with respect to any damage or harm that will
be caused to the Lessee or its property, subject as hereinafter provided.

It is hereby expressly agreed and declared that no liability will attach to the Lessor
of any kind whatsoever towards the Lessee in respect of any damage that has been caused
to the Premises or its contents or to any third party – for any reason whatsoever
regardless of whether the reasons for the damage or the malfunction are known or not,
with the exception of any wilful act of damage by the Lessor and/or by any person on
its behalf.
	 
	 	12.2	 	The Lessor will bear no responsibility whatsoever or liability with respect to
any physical damage or loss and/or damage to property of any kind whatsoever (whether
direct or indirect) that will be caused to the Lessee and/or its workers and/or those
employed by it and/or to its agents or customers or visitors or invitees or to any other
person who is found at the Premises or in any other area occupied by the Lessee with the
licence of the Lessor and/or any property of the Lessee, and the Lessee assumes total
responsibility for any damage of that kind and undertakes to compensate and indemnify
the Lessor against any damages that it will become liable for or compelled to pay
following damage of such kind, against any expense that it will lay out in connection
with such damage.






	13.	 	Grounds for eviction
	 
	 	 	Without derogating and/or detracting from any other provision herein contained, upon the
occurrence of any of the following events, the Lessor will be entitled to immediately
terminate the engagement and the Lease under this Contract, and demand the immediate vacation
of the Premises by the Lessee:










 



12








	 	13.1	 	If the Lessee is in arrears for more than 14 days in the payment of any amount
that has fallen due to the Lessor according to the provisions hereof, and under any law,
and the breach has not been cured within 5 days of receiving a written notice from the
Lessor to do so;
	 
	 	13.2	 	If a receiver (whether temporary or permanent) is appointed or receiver and
manager (whether temporary or permanent) or liquidator (temporary or permanent) for the
Lessee’s business or property or any part thereof and such appointment will not be
vacated within 60 days;
	 
	 	13.3	 	If the Lessee passes a resolution for dissolution or if any dissolution order is
issued against it and such order is not vacated within 60 days or if the Lessee reaches
a compromise or arrangement (within the meaning of the Companies Ordinance) with its
creditors or any of them;
	 
	 	13.4	 	If any final attachment is imposed over all the assets of the Lessee;
	 
	 	13.5	 	If the Lessee is in breach of any of the provisions contained in clause 8 above
and grants to any other person the right of use or any other right whatsoever in the
Premises or in any part thereof and such breach will not have been cured within 5 days
of the despatch of notice in writing by registered mail by the Lessor.






	 	 	It is clarified that the termination of the engagement and eviction of the Lessee in the
circumstances mentioned above will not terminate or detract from any obligation of the Lessee
to fulfil all of its financial obligations under this Contract, for the entire duration of
the Lease Term.
	 
	14.	 	Vacation of the Premises 






	 	14.1	 	The Lessee undertakes, upon the expiration of the Lease Term or the termination
of the Lease and/or the rescission of this Contract for any reason, to vacate the
Premises and surrender possession thereof to the Lessor, the Premises being clear and
vacant of any person and thing belonging to the Lessee, in clean and orderly condition
as the Lessee received the same from the Lessor, subject to fair wear and tear. Should
the Lessor demand, as stated in clause 7.6 above, that supplementary works, alterations
and additions that have been made by the Lessee in the Premises, if at all, will be left
by it at the Premises, then any improvement, enhancement, addition which is permanently
affixed to the Premises – even if these were installed and added to the Premises by and
at the expense of the Lessee, will be left by the Lessee at the Premises.
	 
	 	14.2	 	In the event of the Lessee failing to vacate the Premises on the date specified
above, then, in addition to the Lessor’s right to sue for eviction from the Premises,
and in addition to any other right that the Lessor may have according to this Contract
or at law, and without derogating from any right or relief conferred upon the Lessor
stated above, the Lessee will pay the Lessor for the period commencing on the date it
ought to have vacated the Premises until the date on which it vacates the Premises, an
amount equal to twice the amount of the rent, plus interest on arrears according to
clause 9.2 above, and Value Added Tax, computed on a daily basis, from the date of
creation of the liability to pay until the full and actual payment to the Lessor, and
which would have been payable according to this Contract had the Lease been extended
according to the conditions hereof. The










 



13








	 	 	 	above payment has been set and agreed as proper user fees and/or fixed and pre-agreed
damages as estimated in advance by the parties in accordance with their prior
calculations.
	 
	 	14.3	 	It is hereby stipulated and agreed between the parties that nothing contained
above in this clause shall confer upon the Lessee any right to continue to occupy the
Premises (against payment of the agreed compensation) and/or constitute any waiver on
the part of the Lessor of any of its rights and/or derogate from the Lessor’s right to
obtain any other remedy or relief, including, but without derogating from the generality
of the foregoing, the ejection or removal of the Lessee from the Premises.






	15.	 	Charge or pledge by the Lessor 






	 	15.1	 	The Lessor may pledge and/or charge this Contract in whole or in part, assign any
of its rights thereunder to others, transfer the whole or part thereof in any form
whatsoever as the Lessor deems fit, from time to time, either for the purpose of
obtaining financing or for any other purpose, all at the Lessor’s absolute discretion,
all this being without derogating from the Lessee’s rights under this Contract of Lease.
	 
	 	15.2	 	The Lessor may assign all or any of its rights in the Premises, transfer all or
partial ownership thereof, at its absolute and exclusive discretion, without requiring
the Lessee’s consent, and the Lessee accepts in advance and expressly any such act which
will be effected by the Lessor, unconditionally, and the Lessee will have no claim or
demand or action of any kind whatsoever against the Lessor or its successors, subject to
the Lessee’s rights under this Agreement not being affected.






	16.	 	Lessor’s Remedies in respect of Breach 






	 	16.1	 	Without derogating from that stated in clause 9 above, and further to this clause
and the specific remedies appearing in this Contract, the provisions of the Contracts
(Remedies for Breach of Contract) Law, 5731-1970 will apply to a breach of this
Contract, as well as the provisions of the Contracts (General Part) 5733-1973.
	 
	 	16.2	 	If the Lessee fails to keep the Premises in proper condition or fails to repair
that necessary in the Premises and/or fails to return the Premises to the Lessor at the
expiration of the Lease Term in proper condition or if any damage is caused whatsoever
to the Premises during the Lease Term, and has not been rectified by the Lessee, then,
in addition to any other right that the Lessor may have in such a case pursuant to the
provisions of this Contract and/or at law, the Lessor may effect any repair or do any
act that it deems fit in order to repair the damage or restore the condition to what it
was previously, at the Lessee’s expense and after giving the Lessee seven days prior
written notice and the Lessee has failed to rectify the breach within the 7 day period
mentioned. The Lessee will reimburse the repair expenses against presentation of
invoices for the repair.
	 
	 	16.3	 	Deleted.










 



14








	 	16.4	 	In the event of a termination of the rights of the Lessee under this Contract by
reason of a breach thereof by the Lessee, the Lessor will be entitled to any additional
remedy that it has by law on account of the breach, including the remedy of
compensation, or injunctive or mandatory orders. Notwithstanding anything stated herein
and in addition thereto, in the event of a breach by the Lessee by reason of which the
Lessee has been evicted from the Premises prior to the expiration of the Lease Term, the
Lessee will be required to pay the Lessor, for the period from the date of the eviction
until the expiration of the Lease Term, damages at the rate of double the amount of the
rent which applied prior to the termination of the Lease, all subject as provided in
clause 3.1.4 above, and subject to the fact that if the Premises will be re-leased to an
alternative lessee according and subject to the provisions of this Agreement, only the
difference between the rent prescribed by this Contract and the rent that will be
charged from the alternative tenant, will be paid by the Lessee.






	17.	 	Guarantees — Collateral 






	 	17.1	 	To secure the performance by the Lessee of its undertakings under this Agreement,
the Lessee will deposit with the Lessor on the date of the signature of this Agreement,
an autonomous bank guarantee payable upon demand, linked to the Consumer Price Index,
according to the details contained in this Contract, or deposit an amount equal to six
months rent, or a guarantee of the directors and shareholders of the Lessee
(hereinafter: “the Guarantee” or “the Deposit”).
	 
	 	17.2	 	It is hereby expressly agreed and declared between the parties that the giving of
the Guarantee or the Deposit to perform the terms of this Contract does not amount to
any waiver on the part of the Lessor of any right to any other relief against the
Lessee, whether such relief is set out in the body of this Contract or is available to
the Lessor by virtue of any law existing at the time of the execution of this Contract
or will exist in Israel on the date of the breach.
	 
	 	 	 	The Lessor will give the Lessee seven days prior notice of its intention to exercise
the Guarantee or realize the Deposit.
	 
	 	17.3	 	The forfeiture of the Guarantee or the Deposit will not derogate from the
Lessor’s right to sue for and receive against the Lessee any other relief.
	 
	 	17.4	 	The Lessee will, at the expiration of the Lease Term and on the date of the
surrender of the Premises to the Lessor, furnish the Lessor with certifications
according to its demand in writing, indicating that all the payments and the fees which
it was subject to have been paid by it up till the date of the surrender of the Premises
or in relation to such period.
	 
	 	17.5	 	It is expressly agreed that in the event of the Lessee becoming liable to vacate
the Premises, the Lessor will be entitled to give notice to and demand from the Electric
Corporation and the municipality the disconnection of the electricity and water supply
to the Premises.






	18.	 	Option 






	 	18.1	 	It is hereby agreed that as long as vacant areas remain on the floor on which the
Premises are situated, the Lessee will be entitled to demand to increase the area of










 



15








	 	 	 	the Premises by no more than an additional 450sq.m., on the conditions of the Lease
under this Contract.
	 
	 	 	 	It is clarified that the Lessee will have a first right of refusal in relation to the
leasing of the adjacent areas and that these areas will not be leased until the Lessee
has been given notice by the Lessor seeking to lease the same to any third party, 30
days in advance. The Lessee will notify the Lessor within 30 days of its wish to take a
lease of those areas.
	 
	 	18.2	 	An option is granted to the Lessee to lease an additional 1,000sq.m., in Building
no. 2, when it will be erected (and without this option amounting to any representation
or assurance and/or undertaking regarding the construction thereof) on conditions
identical to those of the Lease under this Agreement.
	 
	 	 	 	Upon a decision being taken to construct Building no. 2, the Lessor will notify the
Lessee of its intention to embark upon the construction of the second building, and the
Lessee will be given a 30-day option to advise if it wishes to exercise its right to
lease an additional area, as stated above.






	19.	 	General 






	 	19.1	 	The option will be afforded to the Lessee to place on the roof of the building of
the Premises, without any further payment, installations such as: air-conditioning
units, a generator, gas containers, air purification units, etc.
	 
	 	19.2	 	Use of the elevator (to ascend to the roof of the building) and payment of the
maintenance and use thereof will be done in accordance with a direct arrangement between
the Lessee and the Ort Braude College, without reference to and any involvement of the
Lessor.
	 
	 	 	 	The Lessee gives notice that it is aware and knows that it is under an obligation to
arrange this matter directly with the Ort Braude College and will have no claims or
demands against the Lessor regarding the use of the elevator and/or the costs that will
be required of it in respect of the use and maintenance thereof.
	 
	 	19.3	 	No delay or grant of time or lack of response, lack of action or lack of taking
any measures on the part of the Lessor will be construed in any form or manner as a
waiver on its part of its rights under this Contract against a continuing or further
breach on the part of the Lessee, unless the Lessor has waived any of its rights
expressly and in writing.
	 
	 	19.4	 	All payments paid by the Lessee under this Contract will be made by the Lessee to
the Lessor by means of a bank transfer to the bank account instructed by the Lessor to
the Lessee in writing.
	 
	 	19.5	 	The addresses of the parties for the purposes of to this Contract appear at the
head of this Contract. If the parties or any of them change their addresses they will
give notice in writing to the other party of the new address in Israel and such address
will from that time onwards serve as the address of that party for the purposes of this
Contract.










 



16








	 	19.6	 	Any notice that will be sent by one party to the other pursuant to the Contract
will be sent by registered mail or delivered personally, and will be deemed to have been
delivered within a reasonable time of notice arriving at the addressee.
	 
	 	19.7	 	The stamping expenses of this Contract will be borne by the parties to this
Agreement in equal shares.
	 
	 	19.8	 	The conditions of this Contract reflect the conditions stipulated between the
parties in full and supersede any engagement, assurance, representation and undertaking
formerly made by the parties prior to the execution of this Contract. No change of this
Contract or any addition thereto if at all will be binding unless made in writing and
signed by all parties.
	 
	 	19.9	 	Notwithstanding that stated in this Agreement and/or in the Plans, the Lessor
undertakes to induce, at its own expense, in the part of the Premises that are
designated to be a production zone according to the Plans, the making of passages
(“shafts”) to the roof for the use of the Lessee’s infrastructure conduits, between the
Premises and the roof, in a ceiling area of up to 6sq.m., according to the definition of
the Lessee’s requirements. It is further agreed that in the period preceding the
commencement of the Lease Term, the Lessee or any person on its behalf may, (but will
not be obliged) to carry out works at the Premises, at its own expense, for the purpose
of installing “clean rooms” in that part of the Premises designated to be a production
zone, as from 10 January, 2004 onwards. The Lessor undertakes to complete the
installation of the electricity and water supply infrastructures to the Premises that
are required to carry out such installation, until such date. It is further agreed that
in the period preceding the commencement of the Lease Term, the Lessee or any person on
its behalf will be entitled (but not obliged) to effect at the Premises at its own
expense, installation works for furniture and laboratory infrastructure at the Premises,
as from 1 February, 2004 onwards.
	 
	 	19.10	 	The Lessor undertakes to grant the Lessee a right to use the internal security
shelter room situated on the floor of the Premises, subject to the provisions of any law
applicable in this respect in consideration of monthly user fees in an amount equal to
$3 (three) per sq.m., (gross) per month (plus VAT). These user fees will be subject to
the provisions of this Agreement in all matters pertaining to the rent mutatis mutandis.






	20.	 	Approved enterprise 






	 	20.1	 	It is agreed that the Lessee will deliver to the Lessor the original application
that it will personally prepare for the purpose of filing the same with the authorities
in order to obtain a certificate of an “approved enterprise”.
	 
	 	 	 	The application will be filed by the Lessor shortly after receiving the necessary
documents, as stated.
	 
	 	20.2	 	If and to the extent the application for the approved enterprise that will be
filed on behalf of the Lessee will in fact be approved, the Lessee will be credited with
the rent on a monthly basis and with a proportionate share of the benefit that the
Lessor will receive at the rate which the area of the total areas of the building (and










 



17








	 	 	 	that part linked thereto) bears to the area of the Premises (and that part linked
thereto).
	 
	 	 	 	It is clarified and agreed that in such a case, the bank guarantee that has been
deposited with the Lessor according to the provisions of clause 17.1 will similarly
serve to secure to indemnify of the Lessor in relation to the monies that it may be
required to repay to the State, if it is compelled to repay them, as a result of a
breach by the Lessee of the conditions for obtaining the definition of “approved
enterprise”.





In witness whereof the parties have set their hands at the time and place first above written:




	 	 	 	 	 
	/s/ Yitzhak Yankopanski
 

The Lessor

	 	/s/ David Aviezer
 

The Lessee
	 	 
	Engel Science Parks (99) Ltd.

	 	Metabogal Ltd.	 	 












 



 


Engel

Construction and Development Group

66 Hahistadrut Blvd., Haifa Bay, Tel: 04-8422777; Fax: 04-8419333




	 	 	 
	 

	 	27 May, 2003
	 

	 	Carmiel – Science Park /10610






			
	 	 	 
	Dr. David Aviezer, CEO	 	 
	Metabogal Laboratories Ltd.,	 	 
	Kiryat Shmonah 
	 	By fax: 08-9762596






RE: Science Park, Carmiel –Lease Offer



Further to our meeting, the offer to plan which was submitted to us by the architect, Hanoch
Shapira and approved by you in principle, I am offering you the ground floor of Building no. 1
(part of) in an area of some 800sq.m., with complete finish, at office level.



The specification will include plasterboard partitions between the offices with acoustic insulation
as required by the Standard, minimum acoustic ceilings, natural porcelain granite flooring,
fluorescent lighting to the level of 500 lumen, electricity sockets for plugs every 4sq.m.,
communication sockets for computers – one every 8 sq.m., telephone sockets – one every 8 sq.m.,
air-conditioning at office level, mini-central air-conditioners and/or central air-conditioning,
as decided by the Company. Factory internal doors, aluminum entrance door of the same type of the
Building’s curtain walls.



Maintenance of all the areas and facilities serving and/or situated in the area of the Premises to
be done by yourself and at your responsibility.



Maintenance of common areas in proportion to the areas leased by the tenants.



At your request one of the elevators will go to the roof of the Building.



Any addition that will be required beyond the above specification will be priced and added to the
rent in accordance with the duration of the lease.



The term of the lease will be five years.



The lease price will be $9.5/sq.m.



Estimated population of the Building -October-November 2003.



Please contact me with any further information you may require.




Yours faithfully,

/s/ Yitzchak Yaacovinsky

Yitzchak Yaacovinsky (Eng.)

Assistant CEO for Leasing and Operations





			
	c.c.	 	Menachem Rosenblum- _____Engineer

Yael Miller, accountant – Engel

Eyal Floumin, Chief Engineer – Engel











 



 


Supplement to the Unprotected Lease Contract




Made and signed this 18th April, 2005




	 	 	 
	Between:

	 	Engel Science Parks (99) Ltd.
	 

	 	66 Hahistadrut Bldv., Haifa Bay


By Yossi Ashkenazi
	 

	 	The party authorized to undertake and sign in the name of the Lessor

(hereinafter: “the Lessor”)
	 

	 	of the first part
	 
	 	 
	And:

	 	Protalix Ltd.
	 

	 	2 Snonit Road, Science Park, P.O.B. 455, Carmiel 20100


(hereinafter: “the Lessee”)
	 

	 	of the second part






	 	 	 
	WHEREAS

	 	A Lease Contract including Appendices was signed between the
parties on 28 October, 2003, (hereinafter: “the Contract”) to
lease a property situated on the ground floor of Building no. 1 of
the building known as “Science Park” – industrial buildings in
Carmiel (hereinafter: “the Premises”) that have been erected by
the Lessor; and
	 
	 	 
	WHEREAS

	 	The Lessee is desirous leasing, and the Lessor has agreed to lease
an additional measured area of 239sq.m., (196sq.m., of principal
area + 43sq.m., of ancillary area) from the Lessor (hereinafter:
	 

	 	“the Additional Area”), which, together with the Premises
according to the original contract will constitute the entire
balance of the area on the ground floor of Building no. 1;






It is therefore agreed, declared and stipulated between the parties as follows:





	1.	 	The Lessor hereby leases to the Lessee and the Lessee hereby leases from the Lessor an
additional area in the Science Park, as described below, so that “the Premises” as defined in
clause 2.3 of the Original Contract, will from henceforth be called, a measured area of
1,177sq.m., constituting the entire ground floor of Building no. 1, and after reducing the
area of the lobby used by Ort for an entrance to their property as marked on the plan attached
hereto this Supplement (hereinafter: “the New Premises Area”).
	 
	2.	 	The Additional Area of the lease according to the Supplement together with the Lease under
the Original Agreement will both expire on 30 April, 2010 (hereinafter: “the New Lease Term”).
	 
	3.	 	The additional rent relating to the Additional Area according to this Supplement will be as
follows:
	 
	 	 	In respect of 196 sq.m., of principal area, the Lessee will pay the sum of $5.5 (in words:
five and a half U.S. dollars) per sq.m., per month and in respect of 43sq.m., of ancillary
area, the Lessee will pay the sum of $3 (in words: three U.S. dollars) per sq.m., per month
(hereinafter: “the Additional Rent”).










 



2








	 	 	The Additional Rent will be paid from 1.5.2005 onwards until the expiration of the New Lease
Term, according to this Supplement.
	 
	 	 	It is clarified that clause 4.1.2 of the Original Agreement does not apply to payment of the
Additional Rent in respect of the Additional Area according to this Supplement.
	 
	4.	 	The Additional Area will be conveyed to the Lessee upon the signature of this Supplement, in
its condition “as is” as of today, the planning of the adaptations and supplemental work in
the additional leased area to be carried out by, at the expense of and according to the
discretion of the Lessee, under the supervision and escorted by the Lessor’s representatives.
	 
	5.	 	For the Additional Leased Area according to this Supplement, the Lessor will designate 7
additional parking places for the use of the Lessee.
	 
	6.	 	An option is hereby granted to the Lessee for five years with respect to the entire Premises,
including the New Premises Area which will commence from the expiration of the New Lease Term,
that is, from 1.5.2010 and end on 30.4.2015 (hereinafter: “the Option Term”).
	 
	 	 	The Lessee will be required to give notice of its wish to exercise the Option Term, not less
than 60 days prior to the expiration of the New Lease Term, according to this Supplement.

	 
	 	 	The rent during the Option Term, will be equal to the New Rent in respect of the New Premises
Area. In the last month of the Lease preceding the commencement of the Option Term – with the
addition of 7.5% (in words: seven and a half percent) linked according to the provisions of
the Original Agreement and to be paid in accordance with the terms thereof.
	 
	7.	 	The clauses of the Original Contract will apply in full to this Supplement, including the
relative Appendices, except for the changes arising from the above clauses.





In witness whereof the parties have set their hands at the time and place first above written:




	 	 	 	 	 
	/s/ Yossi Ashkenazi

 

The Lessor

	 	/s/ David Aviezer
 

The Lessee
	 	 
	Engel Science Parks (99) Ltd.

	 	Protalix Ltd.