---

---

Exhibit 4.24

# AGREEMENT

|Between
|-------

| | BLUE
SQUARE ISRAEL LTD.
| | -----------------------

| | Publ.
Co. 520042847
| | -------------------

| | of
2 Amal Street, Afeq Industrial Zone, Rosh Haayin
| | ----------------------------------------------------

| | (hereinafter:
the Seller)
| | ---------------------------

of the one part;

# And

| | BLUE
SQUARE REAL ESTATE LTD.
| | ----------------------------

| | Pvte.
Co. 513765859
| | -------------------

| | of
2 Amal Street, Afeq Industrial Zone, Rosh Haayin
| | ----------------------------------------------------

| | (hereinafter:
the Buyer)
| | --------------------------

of the other part;

|WHEREAS: | The
Seller  engages in the  operating of a chain of retail  stores and is also the owner
                  of activities in the field of letting,  management,  development and
improvement of real                   estate properties owned by it; and
|-------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|WHEREAS: | Pursuant to a resolution of the Sellers board of directors, the Seller wishes to
split its activities, in a manner whereby properties, rights and obligations connected
with and/or relating to the Sellers activities in the field of letting, management,
development and improvement of real estate properties owned by it (hereinafter:
the Real Estate Activities being Transferred) will be
transferred to the Buyer in consideration for the allotment of shares of the Buyer to the
Seller (hereinafter: the Spin-Off); and
|-------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|WHEREAS: | The Buyer is a wholly-owned subsidiary of the Seller, which was established with the
objective of constituting a real estate development, initiation and management company,
inter alia by way of the acquisition of the properties, rights and obligations
connected with and/or relating to the Real Estate Activities being Transferred; and
|-------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|WHEREAS: | The parties declare that the Spin-Off is being effected for a commercial and economic
purpose, which includes enabling concentration on the development of real estate owned and
managed by the Seller, coupled with creating a sub-specialization in the fields of
activity being transferred; and
|-------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|WHEREAS: | The Spin-Off is being implemented in accordance with [Section] 105A(2) of Income Tax
Ordinance, including all the conditions and sub-sections thereof, and is contingent upon
an approval from the tax authorities and confirmation of the applicability of the tax
benefits under Section 105B of the Income Tax Ordinance; and
|-------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

1

---

---



|WHEREAS: | For purposes of implementing the aforesaid Spin-Off, the Seller wishes to sell to the
Buyer, and the Buyer wishes to purchase from the Seller, the Property Sold as defined
below, all in accordance with the conditions set forth in this Agreement; and
|-------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|WHEREAS: | The parties have applied to the tax authorities with a request to receive a pre-ruling
pursuant to which the Property Sold will be transferred from the Seller to the Buyer in
accordance with Section 105A(2) of the Income Tax Ordinance (New Version), 5721-1961 and
on such conditions as will be specified in the pre-ruling by the tax authorities; and
|-------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|WHEREAS: | The parties wish, in the scope of the provisions of this Agreement, to stipulate and
define the legal relationship between them regarding the acquisition of the Property Sold
and the transfer thereof, subject to a framework that will be prescribed in the pre-ruling
by the tax authorities, all in accordance with the terms and conditions set forth below in
this Agreement;
|-------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Now therefore it is agreed,
declared and stipulated by the parties as follows:

|1. | Preamble
and interpretation
|-- | ---------------------------

| | 1.1 | The preamble to the Agreement, the appendices hereto and the declarations by the parties
constitute an integral part hereof.
| | --- | ----------------------------------------------------------------------------------------------------------------------------

| | 1.2 | The division of this Agreement into clauses and sub-clauses and the headings appearing in
it has been done solely for the sake of convenience, and no use shall be made thereof for
purposes of the interpretation hereof.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | Definitions
|-- | -----------

| | In
this Agreement the following terms will have the meanings set opposite them:
| | -------------------------------------------------------------------------------

| | 2.1 | The Property Sold  the properties being transferred, the rights
being transferred and the liabilities being transferred, as same are defined below.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.2 | The properties being transferred  the real estate properties
mentioned in Appendix A, which will be attached to this Agreement at
the date of closing. For the removal of doubt it is clarified that the properties being
transferred do not include all the real estate properties under the Sellers
ownership/leasehold, and this includes the fact that the properties being transferred do
not include certain additional real estate properties which will be transferred to the
Buyer by the Seller in the scope of a separate agreement.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2

---

---



| | 2.3 | The rights being transferred  all the Sellers rights in
connection with the properties being transferred, including rights pursuant to leasehold
agreements and/or lease agreements and/or co-ownership agreements and/or purchase
agreements and/or any other agreement between the Seller and any third party in connection
with the properties being transferred, and including the Sellers rights
vis-à-vis Coop Blue Square Services Society Ltd. in respect of the
properties being transferred.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.4 | The liabilities being transferred  all the Sellers
liabilities in connection with the properties being transferred and/or in connection with
the financing of the Real Estate Activities being Transferred, including, but without
derogating from the generality of the foregoing, obligations pursuant to leasehold
agreements and/or lease agreements and/or co-ownership agreements and/or any other
agreement between the Seller and any third party in connection with the properties being
transferred. Included in the foregoing the liabilities being transferred include the
financial obligations set forth in Appendix B, which will be attached
to this Agreement on the date of closing, as will be approved in the pre-ruling of the tax
authorities.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2.5 | The effective date  December 31, 2005, or any other date on which
the parties may agree, in accordance with the pre-ruling of the tax authorities.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------

|3. | Representations
and warranties by the Seller
|-- | --------------------------------------------

| | The
Seller hereby represents and warrants to the Buyer that:
| | ------------------------------------------------------------

| | 3.1 | Subject to the fulfillment of the suspensive conditions, there is no legal, contractual or
other bar to its entering into this Agreement and to performing its obligations under this
Agreement in full and punctually on due date.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3.2 | It accepts the consideration shares as hereinafter defined, in the state in which they are
as is without any representation and/or declaration on the part of the Buyer,
including, but without limitation, the condition of the Buyer, its liabilities, assets and
its business, and any other matter and thing likely to be of interest to a reasonable
purchaser of the consideration shares. The Seller waives any allegation of defect or flaw
in connection with the consideration shares.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | Representations
and warranties by the Buyer
|-- | -------------------------------------------

| | The
Buyer hereby represents and warrants to the Seller that:
| | ------------------------------------------------------------

| | 4.1 | It is purchasing the Property Sold in its present condition as is at the date
of signing of this Contract, without any representation and/or declaration on the part of
the Seller, including, but without limitation, in regard to the state of the Real Estate
Properties from the physical and/or zoning and/or legal aspect and/or any other aspect
and/or any other matter and thing likely to be of interest to a reasonable purchaser of
rights in land. The Buyer waives any allegation of defect or flaw in connection with the
Property Sold.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3

---

---



| | 4.2 | Subject to the fulfillment of the suspensive conditions, there is no legal, contractual or
other bar to its entering into this Agreement and to the performance of its obligations
under this Agreement in full and punctually on due date.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | Suspensive
conditions
|-- | ---------------------

| | 5.1 | This
Agreement and its implementation is contingent upon the fulfillment and compliance
with the following cumulative conditions (hereinafter: the Suspensive
Conditions):
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.1.1 | Obtaining
of all the resolutions and approvals required for implementing the transactions covered
by this Agreement from the competent organs of the Seller.
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.1.2 | Obtaining
of all the resolutions and approvals required for implementing the transactions covered
by this Agreement from the competent organs of the Buyer.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.1.3 | Receipt
of a pre-ruling from the Income Tax Commission to the implementation of the Spin-Off
(hereinbefore and hereinafter: the Tax Authorities Pre-Ruling).
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.1.4 | Obtaining
the consent of third parties to the transfer of the Property Sold from the Seller to the
Buyer (including the consent of the creditors to the transfer of these liabilities as set
forth in Appendix C), to the extent that such consents are required.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.2 | If the Suspensive Conditions or any of them is not fulfilled within 6 months from the date
of signing of this Agreement, and the parties have not agreed to an extension of the time
as stated in Clause 5.3 below, this Agreement will be null and void, without this being
deemed to be a breach hereof and without any party having a right to any remedy as a
consequence thereof.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.3 | Notwithstanding the contents of Clause 5.2 above, each of the parties will be entitled, by
way of written notice to the other party, to extend the date for fulfillment of the
Suspensive Conditions, each time for a period of an additional 60 days over and above the
last date that was specified for the fulfillment of the Suspensive Conditions prior to the
giving of the notice, but it is agreed that under no circumstances shall the period for
fulfillment of the Suspensive Conditions be extended beyond a period of 24 months from the
date of signing of this Agreement.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5.4 | Notwithstanding the contents of Clause 5.1 above, it is agreed that the parties will be
entitled to waive the fulfillment of any of the Suspensive Conditions and/or to postpone
the date for the fulfillment of any of the Suspensive Conditions.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4

---

---



|6. | The
transaction and the effective date
|-- | --------------------------------------

| | 6.1 | On the date of closing, as defined below, the Seller will transfer the Property Sold to
the Buyer and the Buyer will accept the Property Sold from the Seller, commencing from the
effective date, including on the basis whereby, commencing from the effective date, the
Buyer will have the rights and obligations in respect of the properties being transferred,
and will be entitled as against third parties and liable to third parties on all aspects
connected with the rights being transferred and the liabilities being transferred,
including on a basis whereby all the income and expenses in respect of the properties
being transferred and/or the rights being transferred and/or the liabilities being
transferred shall apply, commencing from the effective date, to the Buyer and shall be
paid by it. To the extent that either of the parties should bear any payment and/or
receive any income in connection with the properties being transferred and/or the rights
being transferred and/or the liabilities being transferred, in excess of its entitlement
or its obligations, as the case may be, in accordance with the provisions of this Clause
6.1 above, the parties will do an accounting between them, in a manner whereby each party
will bear the expenses and will receive the income in accordance with the provisions of
this Clause 6.1 above.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.2. | Included
in what is stated in Clause 6.1 above, it is agreed between the parties                in
relation to the properties being transferred as follows:
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.2.1 | In
relation to properties forming part of the Real Estate Properties that are leased to
third parties (including properties leased to Blue Square Chain Properties and
Investments Ltd. or to Blue Square Chain Hyper-Hyper Ltd.)  it is agreed that all
the Sellers rights and obligations pursuant to the lease agreements will be
assigned to the Buyer, commencing from the Effective Date, on a basis that the Buyer will
be entitled and liable to third parties as aforesaid, commencing from the Effective Date
onwards, for everything connected with the lease agreements.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.2.2 | In
relation to properties forming part of the Real Estate Properties of which the Seller
itself makes use  it is agreed that these properties will be leased to the Seller
by the Buyer, commencing from the Effective Date onwards, in accordance with the
conditions of lease as set forth in a lease agreement that will be signed between the
Seller and the Buyer, as stated in Clause 8.2 below.
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.3 | To the extent that consent is required from third parties to the transfer of the Property
Sold and/or to any part thereof, the Seller undertakes to act diligently and persistently,
in order to obtain the consent of such third parties. Where consent of any third party is
required as aforesaid and such consent has not been received (hereinafter:
Transfers Requiring Consent), the Seller will continue with the
implementation of the contractual arrangement, in trust for the Buyer until the transfer
is completed. All receipts which the Seller may receive in respect of Transfers Requiring
Consent of the transfer which has not been completed, will be accepted by the Seller in
trust for the Buyer and will be transferred to the Buyer immediately upon the receipt
thereof. The Seller will not have a proprietary and/or other right in and to a receipt
that may be received by it as aforesaid. The Seller will be entitled to indemnity from the
Buyer in respect of its expenses, and in respect of any damage that may be sustained by it
in connection with such Transfers Requiring Approval.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5

---

---



| | It
is agreed that consent fees to the Israel Lands Administration in respect of the transfer
of the rights in any of the Real Estate Properties to the Buyer, to the extent that same
apply, shall be borne by the Buyer and shall be paid by it.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6.4 | The parties shall act in cooperation until completion of registration of the transfer of
rights in the Real Estate Properties from the Seller to the Buyer, and included in this
the parties will sign any deed and/or application and/or any other document that may be
necessary for purposes of completing the registration as aforesaid. It is agreed that the
Buyer will bear all the costs and/or fees connected with completion of registration as
aforesaid.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | It
is agreed that to the extent that there are and/or may be attachments and/or encumbrances
imposed on any of the Real Estate Properties, the Seller undertakes to act for the removal
of such attachments and/or encumbrances, including in a manner that will facilitate
completion of registration of the transfer of rights from the Seller to the Buyer.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|7. | The
consideration
|-- | -----------------

| | As
consideration in respect of the Property Sold, the Buyer undertakes to allot to the
Seller, on the date of closing, 20,000 ordinary shares of NIS 1 par value each in the
Buyer (hereinbefore and hereinafter: the Consideration Shares).
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
parties declare and represent that no consideration has been transferred and/or will be
transferred between them in respect of the Property Sold, apart from the allotment of the
Consideration Shares and as set forth in the approval from the tax authorities.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | The
closing
|-- | -----------

| | 8.1 | Within 7 days from the date of fulfillment of the Suspensive Conditions (hereinbefore and
hereinafter: the Date of Closing), after the parties have verified that
all the Suspensive Conditions have been fulfilled to their satisfaction, the parties will
perform all the following acts and operations at one and the same time:
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8.1.1 | Possession
of the Real Estate Properties will be transferred from the Seller to the Buyer.
| | ----- | ------------------------------------------------------------------------------------------

| | 8.1.2 | The
Buyer will allot the Consideration Shares to the Seller and will deliver to the Seller an
allotment of shares report for the Registrar of Companies which relates to the allotment
of the Consideration Shares to the Seller. The parties will sign a document for effecting
an allotment in the form of Appendix C, which will be attached to
this Agreement on the Date of Closing.
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

6

---

---



| | 8.1.3 | The
Seller will deposit with the Buyer a notarial irrevocable power of attorney in 2 copies
in favor of the Buyer, enabling the Buyer to perform any act in connection with the
Properties being transferred, including the transfer of rights in the Properties being
transferred into the name of the Buyer.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8.1.4 | The
parties will sign any document and will perform any act which may be required for
purposes of consummating the transaction that is the subject of this Agreement.
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8.2 | Within 30 days from the Date of Closing the parties will enter into a lease agreement in
relation to the properties which will be let to the Seller by the Buyer, and also a
services agreement in relation to the services which the parties will render to one
another commencing from the date of closing onwards.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 8.3 | It is agreed that in a case in which the parties decide on transferring certain employees
of the Seller to the Buyer, the parties will, within 30 days from the Date of Closing,
enter into an agreement for the transfer of such employees.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|9. | Liability
and indemnity
|-- | -----------------------

| | Any
responsibility and/or liability to any person and/or body, including to the various
administrative authorities, in connection with the Property Sold, the origin and/or
grounds for which and/or the facts on which same are based relate to any period, whether
before the Date of Closing or after the Date of Closing, except only current payments in
relation to which Clause 10.2 below will apply, shall be borne by the Buyer alone. The
Buyer will indemnify the Seller in respect of any damage or expense that may be caused to
the Seller as a result of a claim or demand in connection with the Property Sold the
responsibility for which is imposed on the Buyer in accordance with the foregoing.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10. | Taxes
|--- | -----

| | 10.1 | The parties are aware that implementation of the transaction that is the subject of this
Agreement does not involve the payment of any taxes, including taxes pursuant to the
Income Tax Ordinance and/or under the Land Taxation Law and/or according to the Income Tax
Law (Adjustments for Inflation). Notwithstanding the foregoing, if any tax should apply in
connection with the implementation of the transaction as aforesaid, then the following
provisions will apply:
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.1.1 | The
Seller will bear payment of any tax or levy, if and to the extent that same applies to
it, in its capacity as seller of the rights in the properties being transferred, by
virtue of the provisions of any law in respect of any transfer of a right in real estate
that is the subject of this Agreement, apart from a betterment levy in relation to which
the provisions of Clause 10.3 below will apply, and apart from consent fees and costs of
registration, to which the contents of Clauses 6.3 and 6.4 above will apply.
| | ------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

7

---

---



| | 10.1.2 | The
Buyer will bear payment of any tax or levy, to the extent that same applies to it, in its
capacity as purchaser of the rights in the properties being transferred, by virtue of the
provisions of any law in respect of any acquisition of a right in real estate that is the
subject of this Agreement, and included in this the purchaser shall bear the Land
Acquisition Tax at a rate of 0.5% in accordance with the tax authorities pre-ruling.
For the avoidance of doubt, it is clarified that in addition the Buyer shall bear the
consent fees and the costs of registration as referred to in Clauses 6.3 and 6.4 above,
and a betterment levy as mentioned in Clause 10.3 below.
| | ------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.2 | All the taxes, municipal rates, fees and current payments which applied and/or which apply
and exist and/or which may apply in the future in connection with the real estate, whether
or not payment thereof has been demanded, including debts to property tax, if same exist,
in relation to a period which is up to the Effective Date, will be borne by the Seller,
and from the Effective Date onwards the payments mentioned in this clause will be borne by
the Buyer.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 10.3 | A betterment levy which applies and/or which may in the future apply in respect of any of
the Real Estate Properties, shall apply to the Buyer and shall be paid by it. It is
clarified in this regard that to the extent that the Seller has a right against any third
party for reimbursement and/or contribution and/or indemnity in respect of such betterment
levies, such right is hereby endorsed over to the Buyer in the scope of this Agreement.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|11. | Arbitration
|--- | -----------

| | 11.1 | Any disputes that may arise between the parties, inter alia, in connection with
and/or in relation to this Agreement and/or in connection with any of the provisions
hereof and/or in connection with the implementation and/or breach hereof, if any, shall be
referred for the decision of an arbitrator who shall be appointed by the parties by
consensus agreement and in the absence of agreement the arbitrator will be appointed by
the senior partner, for the time being, in the firm of the Sellers auditors.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 11.2 | The arbitrator shall adjudicate on the aforesaid disputes or on any of them after having
been requested to do so by notice in writing signed by any of the parties to this
Agreement.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 11.3 | The arbitrator will be bound by the substantive law, but shall not be bound by the rules
of evidence and of procedure.
| | ---- | ----------------------------------------------------------------------------------------------------------------------

8

---

---



| | 11.4 | This clause constitutes a valid arbitration agreement within the meaning thereof under the
Arbitration Law, 5728-1968.
| | ---- | ----------------------------------------------------------------------------------------------------------------------

|12. | Miscellaneous
|--- | -------------

| | 12.1 | This
Agreement does not constitute an agreement in favor of a third party.
| | ---- | --------------------------------------------------------------------------

| | 12.2 | The parties hereby ratify that the validity of this Agreement, in accordance with the
conditions hereof, is commencing from December 31, 2005.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------

| | 12.3 | The expenses of the transaction covered by this Agreement (including attorneys fees,
payments to consultants, etc.) shall be borne by the Buyer and shall be paid by it.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 12.4 | No modification, amendment and/or addition to this Agreement will be of any force and
shall be deemed not to have been made, unless drawn up in writing and signed by all the
parties to this Agreement.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 12.5 | The parties mutually undertake to sign any deed and document and to furnish any approval
and document required for the actual implementation of the transaction pursuant to this
Agreement. For the removal of doubt it is clarified that the parties will be entitled to
extend the validity of any date fixed in this Agreement.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 12.6 | The parties shall render reports according to law to the competent authorities in
connection with this transaction and the implementation hereof, to whatever extent is
required according to law.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# In Witness Whereof the
Parties have Hereunto Signed:

|By: /s/ David Weissman
/s/ Gil UngerBlue Square Israel Ltd. |  | By: /s/ David Weissman
/s/ Uri BogomilskyBlue Square Real Estate Ltd.
|------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------

9

---

---



# List of
properties being transferred in the framework of the split according to Section
105A(2) of the Income Tax Ordinance

|Serial No. | Serial
number in
list of all
Blue Square
assets only | Town or city   | Name of Property                  | Address of Property                  | Block                            | Parcel (including.
portions of parcels)
|---------- | ---------------------------------------------------- | -------------- | --------------------------------- | ------------------------------------ | -------------------------------- | ---------------------------------------
|1          | 1                                                    | Even Yehuda    | Even Yehuda Mall                  | Hameyasdim                           | 8019                             | 3,70,71                                
|2          | 2                                                    | Ofakim         | Ofakim                            | 20 Herzl                             | 39577                            | 1,2                                    
|3          | 3                                                    | Eilat          | Maaleh Eilat D                    | Derech Hayotam                       | 40048                            | 1                                      
|4          | 4                                                    | Eilat          | Eilat-City Center Industrial Zone | 23 Hativat Golani                    | 40029                            | 17, 18, 19                             
|5          | 5                                                    | Eilat          | Pharm Maaleh Eilat                | Derech Hayotam                       | 40048                            | 1                                      
|6          | 6                                                    | Eilat          | Shachmon                          | 290-294 Sheshet Hayamim              | 40096                            | 1                                      
|7          | 8                                                    | Elad           | Elad                              | 32 Ben Zakai                         | 4060                             | 44-51, 58                              
|8          | 9                                                    | Ariel          | Ariel B                           | 78 Tzionut                           | None                             | None                                   
|9          | 11                                                   | Ashdod         | Ashdod C                          | Hapalmach/Ad Halom                   | 2462                             | 45                                     
|10         | 12                                                   | Ashdod         | Ashdod H                          | Sderot Menachem Begin/Merkaz Kalanit | 2074                             | 151                                    
|11         | 13                                                   | Ashdod         | Ashdod Lido                       | Lido Beach                           | 2061                             | 111                                    
|12         | 14                                                   | Ashkelon       | Kanyon Lev Ashkelon               | Hahistadrut 40                       | Block 1929 Parcels 207, 208, 211 | Block 1945, Parcel 33                  
|13         | 15                                                   | Beer Sheva     | Metzada                           | 2 Mivtsa Ovda                        | 38094                            | 32/2                                   
|14         | 16                                                   | Beer-Sheva     | Avia Mall                         | 49 Mivtsa Yoav                       | 38100                            | 59                                     
|15         | 17                                                   | Beitar Elite   | Beitar Illit                      | 22/24 Baba Sali                      | None                             | None                                   
|16         | 18                                                   | Bat-Yam        | Ramat Yosef                       | 20 Mivtza Sinai                      | 7131                             | 39/15                                  
|17         | 19                                                   | Bat Yam        | Mega Bat Yam                      | 20 a Amal                            | 7122                             | 47                                     
|18         | 21                                                   | Givatayim      | Givatayim Offices                 | 13 Tfutsot Israel                    | 8156                             | 535                                    
|19         | 22                                                   | Givatayim      | Givatayim Weizmann, Parking       | 20 Weizman                           | 6154                             | 435/2,3                                
|20         | 23                                                   | Gedera         | Gedera Plot                       | Weizman /Pines                       | 3876                             | 72, 140                                
|21         | 24                                                   | Herzliya       | Nof Yam                           | 10 Shaar Hayam                       | 5670                             | 268                                    
|22         | 25                                                   | Herzliya       | Neveh Amal                        | 19 Katzenelson                       | 6558                             | 151                                    
|23         | 26                                                   | Zickron Yaakov | Shmurat Zichron                   | Hahalutzim/Hakovshim                 | 11319                            | 88                                     
|24         | 27                                                   | Hadera         | Neot Chen                         | 19 Smilansky/ Hillel Yaffe           | 10036                            | 438                                    
|25         | 28                                                   | Hadera         | Beit Eliezer                      | 21 Haatzmaut                         | 7731                             | 126/1                                  
|26         | 29                                                   | Holon          | Neot Shoshanim                    | 104 Hahistadrut                      | 6021                             | 1012/1                                 

1

---

---



# List of
properties being transferred in the framework of the split according to Section
105A(2) of the Income Tax Ordinance

|Serial No. | Serial
number in
list of all
Blue Square
assets only | Town or city   | Name of Property                | Address of Property              | Block                                      | Parcel (including.
portions of parcels)
|---------- | ---------------------------------------------------- | -------------- | ------------------------------- | -------------------------------- | ------------------------------------------ | ---------------------------------------
|27         | 30                                                   | Haifa          | Bat Galim                       | 37 Haaliya Hashniya              | 10817                                      | 29, 30, 31                             
|28         | 31                                                   | Haifa          | Mega Haifa (Castra)             | 8 Friman                         | Blocks 10735, 12064, 12065                 | 24, 50, 58                             
|29         | 32                                                   | Haifa          | Mega Admirality (Store)         | Yigal Yadin/ 71 Halutzei Taasia  | 11636                                      | 3                                      
|30         | 33                                                   | Haifa          | Auditorium                      | Sderot Hanasi Carmel Center      | Block 10307 Parcel 124                     | Parcel 10809 Block 494                 
|31         | 34                                                   | Haifa          | Migdalei Carmel                 | 20 Hanah Senesh                  | 10870                                      | Present Block - 59 Old Blocks - 25, 26 
|32         | 36                                                   | Yokneam        | Yokneam Mall                    | Derachim Mall                    | Block 11098 Parcels 58, 204, 206, 208, 210 | Block 11495 Parcels 23, 58, 66, 68, 71 
|33         | 37                                                   | Jerusalem      | Allenby Jerusalem               | Beitar/Yenovsky                  | 30113                                      | 7                                      
|34         | 38                                                   | Jerusalem      | Talpiot Mall                    | Pierre Koenig 8 / Harekavim      | 30141                                      | 137                                    
|35         | 39                                                   | Kfar-Yona      | Kfar-Yona                       | 6 Sharet                         | 8150                                       | 4,5,6,7,8                              
|36         | 40                                                   | Kfar-Saba      | Ron Kfar-Saba                   | 2 Yehuda Cohen                   | 6431                                       | 184                                    
|37         | 41                                                   | Kfar Saba      | Mega Yachin                     | 1 Atir Yeda                      | Block 7613 Parcel 96                       | Block 7615, Parcels 13, 17             
|38         | 42                                                   | Carmiel        | Mega Carmiel                    | 3 Maaleh Camun                   | 19160                                      | 9                                      
|39         | 43                                                   | Lod            | Ganei Aviv                      | 14 Arba Onot                     | Block 3958 Parcel 41                       | Block 3970 Parcel 102                  
|40         | 44                                                   | Migdal Haemek  | Migdal Haemek                   | 39 Nitzanim/Atsmaut              | 17455                                      | 45,47,57,110, 117                      
|41         | 45                                                   | Modiin         | Malibu                          | 24 Emek Dotan                    | 5690                                       | Parcel 19 Sub -parcel 1                
|42         | 46                                                   | Modiin         | Modiin Hashimshoni              | Emek Bayit Shean/Yehezkel Hanavi | 5669                                       | 21                                     
|43         | 47                                                   | Modiin Elite   | Kiriat Sefer                    | 2 Sderot Yehezkel                | None                                       | None                                   
|44         | 48                                                   | Mazkeret Batia | Mazkeret Batia                  | Sderot Eliahu/Lilach             | 3898                                       | 38                                     
|45         | 49                                                   | Maccabim/Reut  | Maccabim                        | Commercial Center Rananim        | 5313                                       | 78                                     
|46         | 50                                                   | Nahariya       | Northern Mall Nahariya - closed | 2 Irit                           | 18133                                      | 19                                     
|47         | 51                                                   | Neveh Monoson  | Neveh Monoson                   | 30 Hashaked/Pninim               | 6502                                       | 300/2                                  
|48         | 52                                                   | Nes Ziona      | Mega Nes-Ziona                  | Ha'irusim                        | 3845                                       | 269/1                                  

2

---

---



# List of
properties being transferred in the framework of the split according to Section
105A(2) of the Income Tax Ordinance

|Serial No. | Serial
number in
list of all
Blue Square
assets only | Town or city   | Name of Property              | Address of Property           | Block                 | Parcel (including.
portions of parcels)
|---------- | ---------------------------------------------------- | -------------- | ----------------------------- | ----------------------------- | --------------------- | ---------------------------------------
|49         | 53                                                   | Nazareth       | Har Yona                      | Yekinton/Atara                | 17531                 | 64,65                                  
|50         | 54                                                   | Nazareth       | Arbel                         | 1 Amal                        | 17742                 | 6                                      
|51         | 55                                                   | Netivot        | Shefa Shuk Netivot            | 123 Joseph Smilo              | 39583                 | 3, 30                                  
|52         | 56                                                   | Netanya        | Jerusalem                     | 29 Jerusalem                  | 8260                  | 286/1                                  
|53         | 57                                                   | Netanya        | Center - Stampfer             | 14 Stampfer                   | 8264                  | 113/3                                  
|54         | 58                                                   | Netanya        | HaRav Kook                    | 32 Harav Kook                 | 8271                  | 180                                    
|55         | 59                                                   | Afula          | Mega Afula Store              | Kehilat Zion                  | 16699                 | 14-16                                  
|56         | 60                                                   | Petach Tikva   | Amishav                       | 96 Derech Menachem Begin      | 4044                  | 22-34, 36, 37                          
|57         | 61                                                   | Petach Tikva   | Maccabim                      | 73 Stampfer/ Avniel           | 6361                  | 444                                    
|58         | 63                                                   | Kiriat Ata     | Bayit Vegan                   | 10 Haatzmaut                  | 11022                 | 34                                     
|59         | 64                                                   | Kiriat Ata     | Zevulun                       | Zevulun/Haatzmaut             | 11051                 | 71, 103, 112                           
|60         | 65                                                   | Rishon LeZion  | Neveh Carmit                  | 65 Jabotinsky                 | 3945                  | Block 718 Sub-parcel 12                
|61         | 66                                                   | Rishon LeZion  | Rishon LeZion D               | 33 Shimon Peres               | 3946                  | 221                                    
|62         | 67                                                   | Rechovot       | Shaarei Ir- Rechovot          | 15 Derech Yerushalayim        | 3699                  | 248/2                                  
|63         | 68                                                   | Rechovot       | Sharona Center                | 2 Jerusalem /Mader            | 3698                  | 2, 15, 16                              
|64         | 69                                                   | Rechovot       | Mega Rechovot                 | 26 Derech HaYam               | 3654                  | 28, 30                                 
|65         | 71                                                   | Ramle          | Ramle Maccabi Esh Store       | Sderot Jerusalem/Nofei Hamed  | 4341                  | 25, 26                                 
|66         | 72                                                   | Ramat Gan      | Haroe Ramat Gan               | 2 Haroe                       | 6126                  | 8, 26-28                               
|67         | 73                                                   | Ramat Hasharon | Mega Morasha                  | Hacharoshet                   | Block 6547 Parcel 138 | Block 6550 Parcel 92                   
|68         | 75                                                   | Raanana        | Raanana Center                | 114 Ahuza                     | 6580                  | Parcel 23 Sub-parcel 4                 
|69         | 76                                                   | Raanana        | Vatikim                       | 11 Hahistadrut                | 7655                  | 122                                    
|70         | 77                                                   | Raanana        | Bikel                         | 2 Weizman                     | 7657                  | 4                                      
|71         | 78                                                   | Shoham         | Shoham                        | 161 Emek Ayalon               | 6847                  | 10                                     
|72         | 79                                                   | Tel Aviv       | Weizman                       | 20 Weizmann                   | 6111                  | 608, 609                               
|73         | 80                                                   | Tel Aviv       | Dizengoff Square - Shefa Chen | 7 Dizengoff Square, Beilinson | 7091                  | Parcel 65 Sub- parcel 2                
|74         | 82                                                   | Tel Aviv       | La Guardia                    | 76 La Guardia                 | 6134                  | 561/2                                  

3

---

---



# List of
properties being transferred in the framework of the split according to Section
105A(2) of the Income Tax Ordinance

|Serial No. | Serial
number in
list of all
Blue Square
assets only | Town or city | Name of Property         | Address of Property     | Block | Parcel (including.
-portions of parcels)
|---------- | ---------------------------------------------------- | ------------ | ------------------------ | ----------------------- | ----- | ----------------------------------------
|75         | 83                                                   | Tel Aviv     | Ibn Gvirol               | 30 Ibn Gvirol           | 6111  | Parcel 744 Sub parcel 64                
|76         | 84                                                   | Tel Aviv     | Yehuda Hamacabbi         | 46-48 Yehuda Hamacabbi  | 6212  | 865, 866, 867                           
|77         | 85                                                   | Tel Aviv     | Neot Afeka               | 15 Leah                 | 6625  | Parcel 954 Sub -parcels 1, 2            
|78         | 86                                                   | Tel Aviv     | Kiriat Shalom            | 44 Israel Guri          | 6982  | 19                                      
|79         | 87                                                   | Tel Aviv     | Ramat Hahayal            | 7 David Marcus          | 6336  | 450, 451                                
|80         | 88                                                   | Tel Aviv     | Neveh Avivim             | 13 Oppenheimer          | 6630  | Parcel 561 Sub-parcel 8                 
|81         | 89                                                   | Tel Aviv     | Giborei-Israel           | 57 Yigal Alon           | 7108  | 54                                      
|82         | 90                                                   | Tel Aviv     | Migdalei David           | 12 Uri                  | 6111  | 838, 841, 848                           
|83         | 91                                                   | Tel Aviv     | Maoz Aviv                | 209 Bnei Efrayim        | 6636  | Parcel 654 Sub-parcel 1                 
|84         | 92                                                   | Tel Aviv     | Kfar Shalem              | Maapilei Haegoz/ Snapir | 7244  | 81                                      
|85         | 93                                                   | Tel Aviv     | Central Station Tel Aviv | 108 Levinsky            | 7060  | 57, 58                                  
|86         | 94                                                   | Tel Aviv     | Ramot Zahala             | 2 Grofit                | 6624  | 367, 368                                
|87         | 95                                                   | Tel Aviv     | Tel Baruch               | 8 Beker                 | 6626  | 19-24                                   
|88         | 96                                                   | Tel Aviv     | Neveh Tsahal             | 14 Aluf                 | 6892  | 41                                      
|89         | 97                                                   | Tel Aviv     | Shuk Sitonayi            | 94 Hashmonaim           | 7104  | 93                                      
|90         | 98                                                   | Tel-Mond     | Tel-Mond                 | 4 Hashaked              | 7800  | 262                                     

4

---

---



|Appendix A | As
per statements - adjusted to December 31, 2005 in thousand NIS
|---------- | -----------------------------------------------------------------

---

|        |  |  |  |          | 
|------- |  |  |  | -------- | 
|
|
|
|
|        |  |  |  |          | 
|Para. 4 |  |  |  | 000s NIS | 

| |                                         | Total
Immediately prior to
split after deduction
of properties
transferred pursuant to
Section 104 of the
Ordinance | Remaining
in the
splitting
continuing
company | Transferred pursuant
to Section 105
to new company | Transferred
pursuant to
Section 104 | Total real
estate company
Dec. 31, 05
| | --------------------------------------- | ------------------------------------------------------------------------------------------------------------------- | --------------------------------------------- | -------------------------------------------------- | ----------------------------------- | -------------------------------------
|
|
|
|
| | Current assets                          |                                                                                                                     |                                               |                                                    | 619,909                             |                                      
| | Long-term accounts receivable           |                                                                                                                     |                                               |                                                    | 524,358                             |                                      
| | Investee companies                      |                                                                                                                     |                                               |                                                    | 540,248                             |                                      
| |                                         |                                                                                                                     |                                               |                                                    |                                     |                                      
| |                                         |                                                                                                                     |                                               |                                                    |                                     |                                      
| | Fixed assets, net                       |                                                                                                                     |                                               |                                                    | 1,180,513                           |                                      
| | Other assets and deferred
expenses, net |                                                                                                                     |                                               |                                                    | 1,737                               |                                      
| |                                         |                                                                                                                     |                                               |                                                    |                                     |                                      
| |                                         |                                                                                                                     |                                               |                                                    | 2,766,765                           |                                      
| |                                         |                                                                                                                     |                                               |                                                    |                                     |                                      
| |                                         |                                                                                                                     |                                              
| |                                         |                                                                                                                     |                                               |                                                    | 100                                 | %                                    
| |                                         |                                                                                                                     |                                               |                                                    |                                     |                                      
| |                                         |                                                                                                                     |                                               |                                                    |                                     |                                      

|Para. 7                                     |                                                     | As per statements adjusted to December
31, 2005 in thousands NIS |  | 
|------------------------------------------- | --------------------------------------------------- | ---------------------------------------------------------------- |  | 
|
|
|
|
|                                            | Value of assets as per adjusted statements          |                                                                  |  | 
|                                            |                                                     |                                                                  | 
|                                            | Liabilities  for  attribution up to the extent of   |                                                                  | 
|                                            | the value of the property                           |                                                                  | 
|                                            |                                                     |                                                                  | 
|                                            | Suppliers and service providers                     |                                                                  |  | 
|                                            | Accounts payable                                    |                                                                  |  | 
|                                            | Accrued severance pay                               |                                                                  |  | 
|                                            | Deferred taxes, net                                 |                                                                  |  | 
|                                            | Loan associated with real estate transferred        |                                                                  |  | 
|                                            |                                                     |                                                                  |  | 
|                                            | Total associated liabilities                        |                                                                  |  | 
|                                            |                                                     |                                                                  |  | 
|                                            | Total assets less attributed liabilities            |                                                                  |  | 
|                                            |                                                     |                                                                  |  | 
|                                            | Ratio to distribution of non-attributed liabilities |                                                                  |  | 
|                                            |                                                     |                                                                  | 
|Non-attributed liabilities for distribution
|                                            | Interest rate, date of receipt and due date of      |                                                                  | 
|                                            | maturity                                            |                                                                  | 
|Bonds                                       |                                                     | 389,764                                                          |  | 
|                                            | Loan from banks                                     |                                                                  |  | 
|                                            |                                                     |                                                                  |  | 
|Total non-attributed liabilities            |                                                     | 678,721                                                          |  | 
|                                            |                                                     |                                                                  |  | 
|                                            | 100%                                                |                                                                  |  | 

5

---

---