Document:

EXHIBIT
10.12

    
        

      CONFIDENTIAL
MATERIALS OMITTED AND FILED SEPARATELY WITH

      THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE
OMISSIONS.

    ASSIGNMENT
AGREEMENT

    

    This
Assignment Agreement, dated as of the 2 day of July, 2006 , (the “Effective Date”), is entered
into by and between BioLineRx Ltd. (“BioLine”), BioLine Innovations
Jerusalem, LP (“BIJ”),
Bar-Ilan Research and Development Company Ltd. (“BIRAD”) and Ramot at Tel Aviv
University Ltd. (“Ramot”, and together with
BIRAD, the “Licensors”).

    

    WHEREAS,
BioLine and the Licensors entered into that certain Research and License
Agreement dated as of April 15, 2004 (the “Research and License
Agreement”); and

    

    WHEREAS,
BioLine and the Licensors entered into an amendment agreement dated as od
December, 2005 (the “First
Amendment Agreement”) to amend the Research and License Agreement;
and

    

    WHEREAS,
BioLine and the Licensors entered into an amendment agreement dated the 7th day
of March, 2006 (the “Second
Amendment Agreement”) to further amend the Research and License Agreement
(the Research and License Agreement as amended by the First Amendment Agreement
and the Second Amendment Agreement shall be hereinafter referred to as the
“Agreement”);
and

    

    WHEREAS,
certain Research Results have been generated in the course of performing the
Agreement for which patent protection is currently being sought, as more
particularly detailed in Exhibit A attached
hereto (hereinafter referred to as the “Selected Compounds” );
and

    

    WHEREAS,
the Selected Compound forms part of the Licensed Technology licensed to BioLine
pursuant to the Agreement; and

    

    WHEREAS,
BioLine desires to assign all of its rights and obligations under Agreement with
respect to the Selected Compounds  to BIJ according to Section 14.10
of the Agreement; and

    

    WHEREAS,
BioLine and the Licensors have agreed to certain additional arrangements in
respect of such assignment as set out herein;

    

    NOW,
THEREFORE, the parties agree as follows:

    

    1.     
      Capitalized terms used but not otherwise
defined herein shall have the meanings ascribed to them in the
Agreement.

    

    2.       
    The Licensors hereby acknowledge and agree to the
assignment of BioLine’s rights and obligations under the Agreement with respect
to the Assigned Technology to BIJ effective as of the date
hereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    3.  
         Without limiting the
generality of the foregoing, the parties hereby acknowledge and agree that (i)
all rights, title and interest in and to the Selected Compounds shall be
retained by the owners thereof as determined in accordance with Section 3 of the
Agreement and, following the assignment of BioLine’s rights under the Agreement
with respect to the Selected Compounds as contemplated in Section 2 above, the
exclusive license granted to BioLine with respect to the Selected Compounds
pursuant to the Agreement  shall be assigned to BIJ; and (ii) all
rights, title and interest in and to the Development Results shall be owned
solely and exclusively by BIJ.  For the purpose hereof, the term
“Development Results”
shall mean all intellectual property, inventions, conceptions, compositions,
materials, methods, processes, data, information, filings, records, results,
studies and analyses, and other results and information of any kind relating to
the Selected Compounds generated, discovered or acquired solely by employees,
subcontractors or consultants of BIJ (other than members of the TAU Team, as
defined in the Agreement) in the continued development and commercialization of
the Selected Compounds.  For purpose of clarity and without derogating
from the generality of the foregoing, procedures and experiments developed by
BIJ in the course of such development, including methods of chemical synthesis,
drug administration modes, efficacy studies in animal models, formulations,
toxicology, safety, pharmacology, stability, clinical studies and production and
the results of all the foregoing shall be considered “Development
Results”.

    

    4.       
    BIJ may apply for grants and other funding from the
Biotech Incubators Program of the Office of the Chief Scientist of the Israeli
Ministry of Industry and Trade (the “OCS”) for the continued
development of the Selected Compounds.  If BIJ receives such grants,
the development and commercialization of the Selected Compounds will become
subject to the applicable laws and regulations governing such grants including,
without limitation, the Law for the Encouragement of Industrial Research and
Development, 5744-1984 as amended or supplemented from time to time and all
regulations promulgated thereunder, the rules and regulations of the OCS and the
relevant directives of the Director General of the Ministry of Trade, Industry
and Employment (including Directive 8.4), and the rules and regulations of the
Incubator Program of the OCS (together, the “Applicable
Law”).  Except as set forth in Section 5 below, BIJ alone shall
be responsible for meeting the the requirements of the Applicable Law with
respect to the Development Results.

    

    5.    
       In the event the Agreement is
terminated for any of the reasons set out in 13.4.3 of the Agreement, BIJ shall
transfer and assign to the Licensors all Development Results and all rights,
title and interest therein and thereto; subject, however, to any
conditions governing such transfer and assignment set out in the Applicable Law
(collectively, the “Grant
Transfer Conditions”), in which case BIJ will not be required to transfer
and assign the Development Results as contemplated above unless and until the
Licensors either (i) agree in writing to assume all obligations required by the
Grant Transfer Conditions, or (ii) reach another arrangement with the OCS which
absolves BioLine and BIJ of any liability to such grantors with respect to the
transfer and/or assignment of the Development Results.

    

    6.      
     Except as otherwise provided herein , the terms of
the Agreement shall remain in full force and effect.

    

    [Remainder
of page intentionally left blank.  Signature page
follows.]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the
parties have caused this Agreement to be executed by their duly authorized
representatives as of the date first written above.

    

    
      
        
          
            
              	
                      Ramot
      at Tel Aviv University Ltd.

                      By:  /s/
      Ze’ev Weinfeld, Ph.D.

                      Name:
      Ze’ev Weinfeld, Ph.D.

                      Title:
      Executive Vice President,

                      Business
      Development

                       

                    	 	
                      BioLineRx
      Ltd.

                      By: /s/
      Yuri Shoshan

                      Name:
      Yuri Shoshan

                      Title:
      Vice President,

                      Finance
      and Corporate Development

                    
	
                      Bar-Ilan
      Research and Development

                      Company
      Ltd.

                      By:  /s/
      Gabriel Kenan

                      Name:
      Gabriel Kenan

                      Title:
      C.E.O., Bar-Ilan Research & Development Company Ltd

                    	 	
                      BioLine
      Innovations Jerusalem, LP 

                       

                      By:  /s/
      Kinneret Savitsky

                      Name: Kinneret
      Savitsky

                      Title:
      Director, BioLine Innovations Jerusalem,
LP

                    

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
A

    Selected
Compounds

    

    [***]

     

    [***] Omitted pursuant to a confidential
treatment request. The confidential portion has been filed separately with the
SEC.EXHIBIT10.13

            TRANSLATION
FROM HEBREW

            

            State of
Israel

            Ministry
of Industry and Trade, Office of the Chief Scientist

            Technological
Innovation Incubator Program Administration

            

            Date:
August 18, 2005

            Registered

            

            To:

            Kinneret
Savitsky

            BioLine

            

            Dear Sir
or Madam,

            Re: Agreement to Establish a
Center run as an Incubator:

            File:
35583

            

            Enclosed
please find an agreement/amendment to an agreement for the operation of a
technological innovation center as an incubator, signed by all
parties.

            

            Please
confirm the receipt of this agreement in writing.

            

            Sincerely,

            <Signature>

            Rina
Pridor

            Director,
Technological Innovation Incubator Program

            

            Rubber
stamp: Received: 8-28-2005

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

             

            Agreement
to Operate a Biotechnology Incubator

             

            Drawn up
and signed in Jerusalem on _________

             

            Between

             

            The
Government of Israel, on behalf of the State of Israel, represented by the Chief
Scientist and the Controller of the Ministry of Industry, Trade, and Employment
(hereinafter “the State”);

             

            And

             

            The
BioLine Innovations Jerusalem Limited Partnership Biotechnology Incubator,
corporate No. 550218853

             

            by Yuri
Shoshan, ID No. 321101347

             

            and
Morris Laster, ID No. 069455137

             

            Its
authorized signatories (hereinafter “the Incubator”);

             

            Whereas

             

            The
Incubator is a center for biotechnological research and development run as an
incubator, as designated in the operating plan attached to this agreement,
marked Appendix A;

             

            And
whereas

             

            The
Incubator commits itself to operate as a Type-2 Incubator, pursuant to the
Guidelines issued by the director general of the Ministry of Industry and Trade,
No. 8.4 (hereinafter “the director general’s Guidelines”), the provisions of
this agreement, the operating plan, the certificate of approval, and the
statement of commitment to the entire project and the directives of the
Biotechnology Incubator Committee (all of them together: “the
Provisions”);

             

            And
whereas

             

            The State
is interested in the operation of the incubator as a physical, organizational,
professional, marketing, and business framework for research and development
projects in the field of biotechnology with commercial purposes, and all of
this, as detailed in the present agreement;

             

            Now
therefore be it stated, agreed, and stipulated by the parties as
follows:

             

            
              1.

            

            
              
                	
                      	
                        1.1

                      	
                        The
      preamble to this agreement and its appendices are integral parts
      thereof.

                      

              

            

            
              
                	
                      	
                        1.2

                      	
                        All
      definitions not stated in this agreement are to be understood as defined
      in the director general’s
Guidelines.

                      

              

            

            
              
                
                  	
                          2.

                        	
                          The
      representative of the State for the purposes of this agreement is the
      Chief Scientist of the Ministry of Industry and Trade (hereinafter “the
      Chief Scientist”) or his
representative.

                        

                

              

            

            
              
                
                  	
                          3.

                        	
                          The
      purpose of this agreement is to govern the State’s support for the
      operation of the incubator, which will provide a physical, organizational,
      professional, marketing, and business framework for research and
      development projects in the field of biotechnology with commercial
      purposes (hereinafter “the Incubator Project” or “the Incubator
      Projects”).

                        

                

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                        4.

                      	
                        The
      term of this agreement shall be a period of six years, beginning on
      January 1, 2005, and concluding on December 31, 2010 (hereinafter “the
      Term of the Agreement”). The Incubator will be entitled to submit, after
      the lapse of 48 months from the beginning of the Term of the Agreement, a
      request to extend the Term of the Agreement by three additional years.
      Should such a request be submitted, the Biotechnology Incubators
      Committee, as defined below, is entitled to reject it or approve it, to
      stipulate conditions, or to introduced amendments to this agreement or to
      set a shorter extension period. The Biotechnology Incubators Committee
      shall notify the Incubator in writing of its decision on the request for
      an extension within 90 days. Should the extension of the Term of the
      Agreement be approved, the Incubator shall be entitled to sign the
      extension document within 30 days of receiving notification from the
      committee.

                      

              

            

            
              
                	
                        5.

                      	
                        Definitions

                      

              

            

            
              
                	
                      	
                        5.1

                      	
                        State
      Loan: The loan approved by the Biotechnology Incubators Committee for the
      Incubator for a project for its implementation, pursuant to the
      Certificate of Approval for the implementation of that project and in
      keeping with the Provisions.

                      

              

            

            
              
                	
                      	
                        5.2

                      	
                        Project
      agreement: an agreement between a Type-1 Biotechnology Incubator and the
      Project Company, as defined
below.

                      

              

            

            
              
                	
                      	
                        5.3

                      	
                        The
      Biotechnology Incubators Committee: as defined in section 2.4 of the
      director general’s Guidelines (hereinafter “the
    Committee”).

                      

              

            

            
              
                	
                      	
                        5.4

                      	
                        Franchise
      holder: as defined in section 2.4 of the director general’s
      Guidelines.

                      

              

            

            
              
                	
                      	
                        5.5

                      	
                        Project
      company: as defined in section 2.5 of the director general’s
      Guidelines.

                      

              

            

            
              
                	
                      	
                        5.6

                      	
                        Type-1
      Biotechnology Incubator: as defined in section 2.3.1 of the director
      general’s Guidelines.

                      

              

            

            
              
                	
                      	
                        5.7

                      	
                        Type-2
      Biotechnology Incubator: as defined in section 2.3.2 of the director
      general’s Guidelines.

                      

              

            

            
              
                	
                      	
                        5.8

                      	
                        Incubator:
      a type-1 or type-2 Biotechnology Incubator as defined
    above.

                      

              

            

            
              
                	
                      	
                        5.9

                      	
                        Entrepreneur:
      as defined in section 2.2 of the director general’s
      Guidelines.

                      

              

            

            
              
                	
                      	
                        5.10

                      	
                        Certificate
      of Approval: A certificate signed by the Chief Scientist, stipulating the
      conditions of implementation of the R&D work by every Project Company
      and/or Project that is housed in the Incubator, and governing the issuing
      of state loans to the Incubator and/or the Project Company and/or the
      Project.

                      

              

            

            
              
                	
                      	
                        5.11

                      	
                        Encumbered
      Project Assets: As defined in section 5.14 of the director general’s
      Guidelines.

                      

              

            

            
              
                	
                      	
                        5.12

                      	
                        Incubator
      Project: As defined in section 2.6 of the director general’s
      Guidelines.

                      

              

            

            
              
                	
                      	
                        5.13

                      	
                        Intellectual
      Property: The expertise and experience accumulated by the Incubator and/or
      the Project Company and/or anyone acting on their behalf, the trade
      secrets that are relevant, directly and/or indirectly, to the operation of
      the Incubator and/or the Project Company and/or the Project, as well as
      the patents, copyrights, trademarks, trade names, trade secrets,
      inventions, samples, processes, computer programs, technical data, any
      agreement and/or license for implementing the project in any stage
      whatsoever, specific trials on an animal model, synthesis of compounds,
      preclinical trials and their outcomes, and any other intangible rights,
      whether registered or not registered, associated with the operation of the
      Incubator and/or the Project Company and/or the
  Project.

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        5.14

                      	
                        Interest:
      As per the interest rate set in the Award of Interest and Linkage Law
      5721-1961.

                      

              

            

            
              
                	
                      	
                        5.15

                      	
                        Operating
      plan: the plan for operating the incubator submitted to and approved by
      the Committee and/or as it may be updated from time to time with the
      approval of the Committee, including the operating budget of the
      Incubator, all as stipulated in Appendix
A.

                      

              

            

            
              
                	
                      	
                        5.16

                      	
                        Project
      Implementation: As defined in the Certificate of Approval for that Project
      and pursuant to the director general’s
  Guidelines.

                      

              

            

            
              
                	
                      	
                        5.17

                      	
                        Allowed
      Overhead: A payment by a Project Company and/or Project to the Incubator
      on account of outlays for project overhead, in a total amount not to
      exceed 20% (twenty percent) of the labor costs in the approved budget of
      that Project Company and/or
Project.

                      

              

            

            
              
                	
                        6.

                      	
                        The
      Incubator hereby affirms as
follows:

                      

              

            

            
              
                	
                      	
                        6.1

                      	
                        That
      it is organized and registered as an Israeli for-profit corporation whose
      goal is the successful operation of the Incubator. The details of its
      incorporation, including its certificate of incorporation and an
      up-to-date report from the Office of the Registrar of Companies, its
      bylaws, founders’ agreement, and statement of signatory rights certified
      by the Incubator’s attorney are attached to the present agreement as
      Appendix B.

                      

              

            

            
              
                	
                      	
                        6.2

                      	
                        That,
      no later than the end of three months from the date of signing of this
      agreement, the Incubator will operate and be the owner or have leasehold
      rights of an appropriate structure approved in advance by the Committee
      for the housing and implementation of at least eight projects with
      approximately five employees per project. The structure will also include
      the infrastructure appropriate for the operation of a central equipment
      lab, as detailed in section 7.6 of the present agreement (hereinafter “the
      Structure”). Any change in the identity and/or nature of the leasehold
      shall require the advance approval of the Incubators
      Committee.

                      

              

            

            
              
                	
                      	
                        6.3

                      	
                        That
      it has the expertise, experience, and professional and economic capacity
      to manage the incubator pursuant to this agreement and the Provisions, and
      to provide the Project or Projects with a physical, organizational,
      professional, marketing, and business environment for conducting research
      and development in the field of biotechnology for commercial
      purposes.

                      

              

            

            
              
                	
                      	
                        6.4

                      	
                        That
      it has access to first-class consulting services, including in the
      following fields: legal counsel, patents, quality control, regulatory
      affairs and clinical trials, information management, and bookkeeping and
      financial advice.

                      

              

            

            
              
                	
                        7.

                      	
                        The
      Incubator undertakes:

                      

              

            

            
              
                	
                      	
                        7.1

                      	
                        To
      prepare the structure and make it suitable for the needs of running the
      Project or Projects, as may be
required.

                      

              

            

            
              
                	
                      	
                        7.2

                      	
                        To
      manage the incubator, with all its functions, by means of an
      administrative staff, in a professional manner, in keeping with the
      Provisions and to faithfully satisfy all provisions that may be in force
      at that time.

                      

              

            

            
              
                	
                      	
                        7.3

                      	
                        To
      employ a fulltime general manager for the incubator, with the appropriate
      skills (hereinafter “General
Manager”).

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        7.4

                      	
                        To
      employ a fulltime administrative director for the incubator, as well as a
      secretarial and bookkeeping staff with the appropriate skills,
      proportional to the scale of the incubator’s
  activities.

                      

              

            

            
              
                	
                      	
                        7.5

                      	
                        To
      employ, in addition to the above, one assistant manager with the
      professional and business skills appropriate for the field for every three
      projects being carried out in the incubator, starting from the first
      project.

                      

              

            

            
              
                	
                      	
                        7.6

                      	
                        To
      establish and operate a central lab for all the projects (hereinafter “the
      Lab”).

                      

              

            

            
              
                	
                      	
                        7.6.1

                      	
                         
      To employ a fulltime manager or operator of the central Lab, with the
      appropriate skills. During its first year of activity the Incubator is
      entitled to satisfy this obligation by means of an outside contractor that
      runs the Lab and/or to employ a part-time manager
  only.

                      

              

            

            
              
                	
                      	
                        7.6.2

                      	
                         
      To set up and operate the Lab no later than the end of the first year of
      the Incubator’s activity, as per the requirements included in section 4.2
      of the director general’s
Guidelines.

                      

              

            

            
              
                	
                      	
                        7.7

                      	
                        To
      train the project managers to work according to quality
      principles.

                      

              

            

            
              
                	
                      	
                        7.8

                      	
                        To
      operate the Incubator for at least six years and to invest in its
      operation an annual sum of not less than NIS 2,700,000 (two million seven
      hundred thousand) for each year of operation (as defined below) for the
      Term of the Agreement (hereinafter the “Total Investment”). The Total
      Investment will be linked to the Consumer Price Index published in
      February 2004. The Total Investment will be updated once at the start of
      each year as a function of the rise in the index from February 2004 to
      January of that year (hereinafter the “Updated Total Investment”). It is
      stipulated that should the cumulative change in the index be negative, the
      Total Investment will not be decreased. To eliminate any doubt, the Total
      Investment shall be in addition to the supplementary financing required
      for each Incubator project and for the Allowed Overhead as part of the
      Project’s approved budget project, and in addition to financing equipment
      for the Lab and its maintenance, as stipulated in section 7.6
      above.

                      

              

            

            
              
                	
                      	
                        7.9

                      	
                        Bank
      Guarantee

                      

              

            

            
              
                	
                      	
                        7.9.1

                      	
                         
      To guarantee the Incubator’s undertakings under the present agreement, the
      Incubator and/or its controlling party will convey a linked bank guarantee
      payable to the State in the amount of NIS 8,100,000 (eight million
      one-hundred thousand), linked to the Consumer Price Index published in
      February 2004, which will remain in force until the passage of three
      months after the Term of the Agreement, in the form attached to the
      present agreement as Appendix
C.

                      

              

            

            
              
                	
                      	
                        7.9.2

                      	
                         
      It is stipulated and agreed that after the lapse two years from the start
      of the Term of the Agreement, the amount of the bank guarantee to the
      State will be reduced on account of any reported outlays approved by the
      Chief Scientist and included in the approved budget of the Incubator. This
      reduction will be at the rate of 50% (fifty percent) of the outlays
      reported as above, which will not be less than NIS 500,000 (five hundred
      thousand), but the sum of the Guarantee will not fall, in any case and at
      any time, to less than NIS 1,500,000 (one million five-hundred thousand),
      and as specified in Appendix C to the present
  agreement.

                      

              

            

            
              
                	
                      	
                        7.10

                      	
                        Not
      to charge any fee to the Project Company and/or an Incubator Project for
      the operation or use of equipment in the Lab and/or any other expenditure
      associated with the Lab or for the personnel to run it, beyond the Allowed
      Overhead, except for payments for materials and consumables that may be
      required to conduct the
project.

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        7.11

                      	
                        To
      obtain the Committee’s approval for any transfer of controlling interest
      in the Incubator. For this purpose “Control” is as defined in the
      Securities Law 5722-1968.

                      

              

            

            
              
                	
                      	
                        7.12

                      	
                        To
      manage the State Loan to the project in a professional manner, pursuant to
      the Provisions. Any outstanding balance of the State Loan that has not yet
      been made available to the Project Company and/or Project, for any reason
      whatsoever, shall be invested exclusively in interest-bearing bank
      deposits or government
securities.

                      

              

            

            
              
                	
                      	
                        7.13

                      	
                        To
      use the State Loan for projects exclusively to support projects under the
      present agreement.

                      

              

            

            
              
                	
                      	
                        7.14

                      	
                        To
      maintain proper audited books of all of the Incubator’s activities, as per
      all laws and regulations, and in keeping with Generally Accepted
      Accounting Principles, to permit examination by the Chief Scientist or his
      representative at any time.

                      

              

            

            
              
                	
                      	
                        7.15

                      	
                        To
      submit a report summarizing the activities of the incubator for that
      period to the Office of the Chief Scientist, every six months after the
      start of the Term of the
Agreement.

                      

              

            

            
              
                	
                      	
                        7.16

                      	
                        To
      submit to the Office of the Chief Scientist an annual trial balance for
      all of the Incubator’s financial activities, for each six months of
      activity. This shall include details of all moneys paid out on account of
      the State Loan and all moneys spent by the Incubator, for each six months
      of activity.

                      

              

            

            
              
                	
                      	
                        7.17

                      	
                        To
      submit to the Office of the Chief Scientist for every calendar year
      running from January 1 through December 31st
      (hereinafter the “Fiscal Year”), starting on the date of the signing of
      this agreement, a financial statement approved by an accountant that
      covers all of the Incubator’s financial activities and that includes full
      information about all moneys paid out on account of the State Loan to
      Projects and all moneys spent by the Incubator, for the entire Fiscal Year
      (hereinafter “Yearly Financial Statement”), no later than 90 days after
      the end of the Fiscal Year.

                      

              

            

            
              
                	
                      	
                        7.18

                      	
                        To
      submit the aforesaid reports and statements, pursuant to the Chief
      Scientist’s regulations for financial statements and technical reports, on
      the forms that may be specified by the Chief Scientist and as may be
      modified from time to time.

                      

              

            

            
              
                	
                      	
                        7.19

                      	
                        To
      identify, study, and select appropriate project or projects to be run as
      part of the Incubator. The selection of project or projects and their
      acceptance for the Incubator shall be at the Incubator’s discretion, in
      keeping with the list of criteria for the approval of projects attached to
      the present agreement and labeled Appendix
D.

                      

              

            

            
              
                	
                      	
                        7.20

                      	
                        To
      help project developers identify, interview, and hire appropriate
      researchers for the projects.

                      

              

            

            
              
                	
                      	
                        7.21

                      	
                        To
      provide the projects with administrative services, including secretarial
      services, maintenance, purchasing, bookkeeping, and computer
      infrastructure and services, as required for the efficient and effective
      operation of each project, all in keeping with the project agreement and
      in keeping with the terms that may be agreed upon between the Incubator
      and the Project Company and/or the
Project.

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        7.22

                      	
                        To
      provide the Projects with professional assistance and guidance so that
      they can carry out their R&D efficiently and
      professionally.

                      

              

            

            
              
                	
                      	
                        7.23

                      	
                        For
      each Project that has received a Certificate of Approval, to make
      available supplemental financial resources, in addition to the State Loan,
      as required for carrying out the R&D work on the Projects (the
      “Supplementary Financing”).

                      

              

            

            
              
                	
                      	
                        7.24

                      	
                        To
      assist the Projects in registering and/organizing as commercial entities,
      if necessary, to draw up a business plan, to organize for marketing and
      raising capital for the further successful operation of the Project and
      its development as a commercial
venture.

                      

              

            

            
              
                	
                      	
                        7.25

                      	
                        To
      manage, faithfully and separately for each project, the budget of that
      Project, including the State Loan for the Project transferred to the
      Incubator for implementation of the
project.

                      

              

            

            
              
                	
                      	
                        7.26

                      	
                        To
      conduct an administrative, financial, and professional audit of the
      implementation of each project and its progress as per the Project plan,
      and to fulfill all of the obligations incumbent on the Incubator under
      Certificates of Approval.

                      

              

            

            
              
                	
                      	
                        7.27

                      	
                        Services
      supplied to Projects

                      

              

            

            
              
                	
                      	
                        7.27.1

                      	
                        To
      provide the Projects with access to consulting and oversight services in
      the following domains: bookkeeping and auditing, legal counsel, patents,
      quality control, information management, regulatory affairs and clinical
      trials, to be provided by service providers who are known to the Committee
      and/or substitutes approved by the Committee as being of acceptable scope
      and quality.

                      

              

            

            
              
                	
                      	
                        7.27.2

                      	
                         
      Not to deviate from the Allowed Overhead permitted by the director
      general’s Guidelines, with regard to the collection of payments from
      Projects in the Incubator for services provided to the Projects by the
      Incubator.

                      

              

            

            
              
                	
                      	
                        7.28

                      	
                        That
      the signatories below are authorized to bind it with regard to the present
      agreement.

                      

              

            

            
              
                	
                      	
                        7.29

                      	
                        Against
      the State Loans to be granted to the Incubator on account of the Projects,
      the Incubator will record to the benefit of the State a first-degree
      floating lien, as in the form attached as Appendix E, on all of the
      Incubator’s assets, including restriction of the transfer and/or
      registration of rights in the technologies created by the Projects during
      the term of the Incubator, and all equipment that may be purchased for use
      by the Project. The Incubator shall be required to notify the Incubators
      Administration about the assets covered by the aforesaid lien, pursuant to
      the procedures of the Technological Innovations Incubator Program of the
      Office of the Chief Scientist. To eliminate all doubt, in no case shall
      the Incubator and/or Project Company be entitled to sell the equipment
      stated in the present section 7.29, or any part thereof, or to transfer it
      in any fashion whatsoever to a third party, or to create additional liens
      on it, without the written agreement of the State, until it has fully
      repaid the State Loans to the State. All revenues from realization of the
      lien and/or liens shall be divided pro rata between the State and other
      creditors, as per law and
regulations.

                      

              

            

            
              
                	
                      	
                        7.30

                      	
                        That
      a Project will remain in the incubator only for the period of its
      implementation. The Incubator shall be entitled to appeal to the Committee
      and request an extension of the period. The Committee is entitled to
      approve the extension of the period at its exclusive discretion, as
      stipulated in the director general’s
Guidelines.

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        7.31

                      	
                        Intellectual
      Property

                      

              

            

            
              
                	
                      	
                        7.31.1

                      	
                        For
      a Type-1 Biotechnology Incubator: That it will not own the intellectual
      property associated with the Projects and/or owned by the Project
      Companies and/or licensed by them and will have no call or claim on it. A
      Type-1 Biotechnology Incubator will guarantee that the intellectual
      property is in the exclusive ownership of the Project Company and that the
      Project Company and/or those acting on its behalf will not permit any use
      and/or transfer of the intellectual property to a third
    party.

                      

              

            

            
              
                	
                      	
                        7.31.2

                      	
                        For
      a Type-2 Biotechnology Incubator: That the intellectual property will be
      in its exclusive ownership and that it and/or anyone acting on its behalf
      will not permit the use and/or transfer of the intellectual property to a
      third party, except for the Project Company and/or pursuant to the
      provisions of section 12 below, and subject to section 7.1 in the director
      general’s Guidelines.

                      

              

            

            
              
                	
                      	
                        7.31.3

                      	
                        That
      the agreement between the Project Companies and/or Type-2 Biotechnology
      Incubator with any third party includes, but not exclusively, university
      technology transfer companies and/or research institutes, in everything
      associated with the projects:

                      

              

            

            
              
                7.31.3.1     
With
regard to intellectual property that existed prior to the Project, the Incubator
will acquire ownership rights in the intellectual property or the grant of an
exclusive and irrevocable use license from a third party to the Project Company
and/or Type-2 Biotechnology Incubator.

              

            

            
              
                7.31.3.2     
The
aforesaid third party shall not be granted any rights in the intellectual
property beyond those already possessed by said third party when the irrevocable
use license was granted or acquisition of ownership rights to the intellectual
property by the Project Company or the Type-2 Biotechnology Incubator and on
account of which the Project Companies or Type-2 Biotechnology Incubator have
received a use license.

              

            

            
              
                7.31.3.3     
The
aforesaid notwithstanding, in the case of Projects that have failed or have been
terminated, an aforesaid third party shall be entitled to acquire rights in the
intellectual property associated with the Project and/or created by it, subject
to the Provisions and the approval of the Committee, if it agrees to assume all
of the Incubator’s obligations to the State with regard to the Project, and in
particular section 7.1 of the director general’s
Guidelines.

              

            

            
              
                	
                      	
                        7.31.4

                      	
                        Any
      transfer of knowledge to a third party is subject to the director
      general’s Guidelines.

                      

              

            

            
              
                	
                        8.

                      	
                        The
      State undertakes to act in accordance with the
  Provisions:

                      

              

            

            
              
                	
                      	
                        8.1

                      	
                        To
      convey to the Incubator the State Loan for the Project on account of which
      the Certificate of Approval was issued, provided that the Incubator meets
      its full obligations pursuant to the
Provisions.

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        8.2

                      	
                        To
      grant the Incubator a loan to purchase equipment for the central Lab, in
      an amount of up to 50% of the cost of the equipment, at the time of the
      purchase, with regard to purchases throughout the Term of the Agreement.
      The purchase of any item of equipment shall require the approval of
      Committee and said item will be covered by the lien on the assets of the
      Incubator as stated in section 7.19 above. When it is no longer in use the
      relative portion of its depreciated value or its market price on the date
      when it ceases to be in use, whichever is less, will be returned to the
      State and the lien in favor of the State removed from
  it.

                      

              

            

            
              
                	
                        9.

                      	
                        Shares
      of the Incubator Project
Companies:

                      

              

            

            
              
                The
Incubator
shall be entitled to acquire up to 70% of the share capital of each Project
Company, pursuant to what the provisions of sections 5.11.6 through 5.11.8 of
the director general’s Guidelines.

              

            

            
              
                	
                        10.

                      	
                        Project
      Assets on which the State holds a
lien:

                      

              

            

            

            
              
                	
                        11.

                      	
                        As
      stated in section 7.29 above, against the State Loans granted to the
      Incubator on account of the Projects, the Incubator will record to the
      benefit of the State a first-degree floating lien on all assets of the
      incubator, including restriction of the transfer and/or registration of
      rights in the technologies created by the Projects during the term of the
      Incubator, and all equipment that may be purchased for use by the Project.
      The Incubator shall be required to notify the Incubators Administration
      about the assets covered by the aforesaid lien, pursuant to the procedures
      of the Technological Innovations Incubator Program of the Office of the
      Chief Scientist. In addition the Incubator undertakes to transfer the lien
      to the shares of the Project Companies when they are established, pursuant
      to section 5.14.1 of the director general’s Guidelines. For additional
      allocations of shares:

                      

              

            

            
              
                	
                      	
                        11.1

                      	
                        The
      initial allocation of shares in the Project Company as stated in section 9
      above shall be of the same category. Subject to this, it shall be possible
      to allocate shares of different categories in the Project
      Company.

                      

              

            

            
              
                	
                      	
                        11.2

                      	
                        The
      allocation of a category of shares to the Incubator and/or to a party
      associated with the Incubator of any type that bears rights other than
      those of the encumbered shares shall be possible only in the following
      conditions:

                      

              

            

            
              
                	
                      	
                        11.2.1

                      	
                        Should
      the said allocation of shares be in the context of the inclusion of the
      Incubator and/or some party associated with the Incubator to a third-party
      investment in the Project Company, on terms worked out by said third party
      and the Project Company in an arms-length agreement, and the Incubator or
      party associated with the Incubator makes less than 50% of the investment
      in the Project Company in that round of investment, the Incubator will
      notify the Committee as to the existence of the agreement within seven (7)
      days of the signing of said
agreement.

                      

              

            

            
              
                	
                      	
                        11.2.2

                      	
                        In
      any other case, an allocation of shares shall be made only after written
      approval has been obtained from the
Committee.

                      

              

            

            
              “Party
associated with the Incubator”: an individual or corporation with a controlling
interest in the Incubator or one in which the Incubator or controlling party in
the Incubator holds more than 25% of its shares, directly or
indirectly.

            

            
              “Third
party”: A party that neither the Incubator nor a party associated with the
Incubator.

            

            
              “Control”:
as defined in the Securities Law 5728-1968.

            

            
              
                	
                      	
                        11.3

                      	
                        No
      additional allocation of shares shall be made other than against cash,
      except with the approval of the
Committee.

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                        12.

                      	
                        Sales
      of encumbered Project assets

                      

              

            

            
              
                	
                      	
                        12.1

                      	
                        The
      Incubator shall be entitled to sell encumbered assets of the Project that
      are in its possession at any time, at its exclusive discretion, on sole
      condition that when encumbered project assets are sold the Incubator makes
      use of the proceeds of the sale as
follows:

                      

              

            

            
              
                	
                      	
                        12.1.1

                      	
                        A
      Type-1 Biotechnology Incubator and/or its shareholder shall be entitled to
      sell their shares in the Project Company, including the encumbered assets
      of the Project, at any time and at their exclusive discretion, on
      condition that at least 25% of the proceeds of any sale be transferred by
      the Incubator and/or its shareholders to the State, against repayment of
      the State Loans to the Project, as per section 13
  below.

                      

              

            

            
              
                	
                      	
                        12.1.2

                      	
                        A
      Type-2 Biotechnology Incubator and/or its shareholders shall be entitled
      to sell their shares in the Project Company, including the encumbered
      assets of the Project, at any time and at their exclusive discretion, on
      condition that at least 25% of the proceeds of any sale be transferred by
      the Incubator and/or its shareholders to the State, against repayment of
      the State Loans to the Project, as per section 13
  below.

                      

              

            

            
              
                	
                      	
                        12.1.3

                      	
                        In
      any case of a sale of the technology in full and/or grant of an exclusive
      use license in any of the intellectual property assets, the State Loan
      given to the Incubator Project shall be repaid in
  full.

                      

              

            

            
              
                	
                      	
                        12.1.4

                      	
                        Should
      the technology be split up so as to grant more than one use license, an
      amount equivalent to 25% of the proceeds for each
  license.

                      

              

            

            
              
                	
                      	
                        12.2

                      	
                        In
      any case, the total of all moneys transferred to the State on account of
      sales as stated in the present section shall not exceed the total of the
      State Loan to the Incubator for that Project Company and/or Project, plus
      interest and linkage to the Consumer Price Index, as stated in section
      13.

                      

              

            

            
              
                	
                      	
                        12.3

                      	
                        For
      a Project Company: After full repayment of the balance of the State Loan,
      plus interest, the remaining proceeds of the sales of the Incubator’s
      shares in that Project Company shall be full owned by the Incubator and
      the State shall have no claim or demand on
it.

                      

              

            

            
              
                For
an
Incubator Project: After full repayment of the balance of the State Loan, as
stipulated in section 13 below, with regard to a particular project, the
encumbered Project assets for that Project will be removed from the lien, in
accordance with the procedures of the Technology Innovation Incubators Program
of the Office of the Chief Scientist, and the State shall have no claim or
demand on them. The State will give its approval in the form attached as
Appendix F.

              

            

            
              
                	
                      	
                        12.4

                      	
                        The
      grant of an option to acquire the base shares to be transferred by the
      Incubator to employees of that Incubator Project shall not be considered
      to be a sale for the purposes of the present
  section.

                      

              

            

            
              
                	
                      	
                        12.5

                      	
                        The
      lien on encumbered project assets, in whole or in part, shall be removed
      immediately after payment to the State in keeping with section 13 below.
      If only part of the lien has been removed, the State’s rights to receive
      the balance of the proceeds pursuant to this section must be retained,
      subject to the Provisions and to section 7.31
  above.

                      

              

            

            
              
                	
                        13.

                      	
                        Repayment
      of the State Loan to the
Project:

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        13.1

                      	
                        The
      Incubator may repay the State Loan to the Project in cash, on the
      following terms:

                      

              

            

            

            
              
                	
                      	
                        13.2

                      	
                        During
      the term of implementation of the Incubator Project, repayment shall be in
      exchange for the nominal value of the State Loan, plus
      interest.

                      

              

            

            
              
                	
                      	
                        13.3

                      	
                        During
      the first two years after the end of the term of the Incubator Project the
      terms of section 13.2 shall remain in force, on condition that the
      Incubator undertakes to continue to operate the Project Company and/or the
      Project on a similar scale.

                      

              

            

            
              
                	
                      	
                        13.4

                      	
                        For
      the next three years, the terms of section 13.2 shall remain on force, on
      condition that the Incubator undertakes to continue to operate the Project
      Company and/or the Project on a similar scale, but the interest on the
      State Loan in these years shall be
doubled.

                      

              

            

            
              
                	
                      	
                        13.5

                      	
                        The
      state will remove the lien from the encumbered Project assets in an amount
      proportional to the fraction of the State Loan that has been repaid. In
      addition, the State will remove the lien from the relative part of the
      encumbered Project assets in an amount proportional to whatever sums have
      not been transferred to the Project and have been returned to the State.
      The removal of the lien shall be according to the procedures of the
      Technological Innovations Incubator Program of the Office of the Chief
      Scientist.

                      

              

            

            
              
                	
                      	
                        13.6

                      	
                        Should
      the Incubator breach its undertakings under the Provisions, or some of
      them, and without derogating from other remedies available to the State
      under this agreement or by law, the Incubator shall repay to the State,
      immediately upon its first demand and no later than 30 days thereafter,
      all sums it has received on account of the State Loan for the Projects and
      that have not yet been transferred to the Project Company and/or the
      Project and/or moneys that have been transferred to the Project Company
      and/or the Project that deviate from the terms of the Certificate of
      Approval, plus linkage differentials and interest, in the meaning of the
      Award of Interest and Linkage Law
5721-1961.

                      

              

            

            
              
                	
                      	
                        13.7

                      	
                        If
      the Incubator received a State Loan for Projects, but a liquidation order
      or bankruptcy order has been issued against it, or it has decided on its
      voluntary liquidation, before all of its obligation under the present
      agreement and/or the directives and/or the Certificate of Approval and/or
      the statement of commitment have been fulfilled, it will be considered as
      if it had undertaken to pay back the State Loan, including everything
      purchased using the moneys of said State Loan, before the liquidation
      order or bankruptcy order was issued or before the decision was
      taken.

                      

              

            

            
              
                	
                        14.

                      	
                        Realization
      of liens

                      

              

            

            
              The State
will be entitled to realize its liens on encumbered project assets to repay the
balance of the State Loan for that Project:

            

            
              
                	
                      	
                        14.1.1

                      	
                        At
      the expiration of 8 years from the issuance of the Certificate of Approval
      for that Project, and after 30 days have lapsed from notification to the
      Incubator of its intention to do so;
or

                      

              

            

            
              
                	
                      	
                        14.1.2

                      	
                        At
      any earlier date should an order of liquidation or order of bankruptcy be
      issued against the Incubator or Project Company or should the latter
      decide on voluntary liquidation;
or

                      

              

            

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            
              
                	
                      	
                        14.1.3

                      	
                        Should
      the incubator breach its undertakings pursuant to the present agreement
      and/or the Provisions and/or the Certificate of Approval regarding that
      project, in some fundamental
breach.

                      

              

            

            
              
                	
                        15.

                      	
                        The
      incubator shall not be entitled to transfer any rights or obligations
      under the present agreement to another
party.

                      

              

            

            
              
                	
                      	
                        15.1

                      	
                        The
      aforesaid in section 15 notwithstanding, the Incubator shall be entitled
      to transfer and/or to assign its right to repayment of the State Loan to
      any third party, as stated in section 13 above. However, nothing in this
      shall be deemed to release the Incubator from any of its obligations under
      the present agreement. The Incubator undertakes to notify the State in
      writing immediately upon any assignment or transfer as
    stated.

                      

              

            

            
              
                	
                      	
                        15.2

                      	
                        The
      agreement by any parties to deviate from any conditions whatsoever of the
      present agreement, in a specific case or in a series of cases, shall not
      serve as a precedent and nothing shall be inferred from it for any other
      cases in the future.

                      

              

            

            
              
                	
                      	
                        15.3

                      	
                        Should
      either of the parties fail to enforce or enforce tardily any right
      whatsoever granted it pursuant to the present agreement under law, in any
      case or in a series of cases, this shall not be seen as a waiver of said
      right or of any other rights
whatsoever.

                      

              

            

            
              
                	
                        16.

                      	
                        Any
      notice or warning related to any matter that derives from the present
      agreement shall be sent by one party to the other by registered mail, to
      the addresses indicated below, and will be considered to have been
      received by the addressee within 72 hours of the posting of the letter
      that includes the notice or
warning.

                      

              

            

            
              The
State: Incubators Administration, Office of the Chief Scientist, Ministry of
Industry and Trade, POB 50031, 61500 Tel Aviv

            

            
              The
incubator:

            

            
              
                	
                        17.

                      	
                        All
      of the conditions of sections 4, 6, 7, 10, 11, and 12, are fundamental
      conditions. The breach of any one or more of them is fundamental breach
      under the Law of Contracts (Remedies for Breach of Contracts) 5731-1970.
      The present section is to be amended in accordance with the final
      draft.

                      

              

            

            
              
                	
                        18.

                      	
                        The
      incubator will have the present agreement stamped and will be responsible
      for the stamp tax.

                      

              

            

            

            
              In
witness whereof the parties have affixed their signatures on the date stated at
the beginning of this agreement.

            

            

            The
State:

            <rubber
stamp and signature> Raanan Dinur, director general

            

            <Signature>

            The Chief
Scientist

            

            <Signature>

            the
Controller

            

            Rubber
stamp: BioLine Innovations Jerusalem Limited Partnership By its General Partner,
BioLine Innovations Jerusalem Ltd.

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

            /s/
Morris Laster

            Name of
signatory: Morris Laster

            

            Rubber
stamp: BioLine Innovations Jerusalem Limited Partnership By its General Partner,
BioLine Innovations Jerusalem Ltd.

            /s/ Yuri
Shoshan

            Name of
signatory: Yuri Shoshan

            

            Version:
January 26, 2005

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

             

            Yigal
Arnon and Co., Advocates and Notary

             

            Jerusalem,
January 16, 2005

            Ref.
9218

            To:

            Ms. Rina
Pridor

            Technological
Incubators Administration

            Hamered
29, Tel Aviv

            

            Dear
Madam,

            

            Re:
Confirmation of Authorized Signatories, BioLine Innovations Jerusalem, Limited
Partnership

            

            As the
attorneys of BioLine Innovations Jerusalem Limited Partnership (hereinafter “the
Incubator”), I hereby affirm that, in keeping with the limited partnership
agreement of the Incubator, dated December 23, 2004, the general partner of the
Incubator is BioLine Innovations Jerusalem, Ltd. (hereinafter: “the General
Partner”). In its capacity as general partner the General Partner will be
exclusively responsible for managing all affairs of the Incubator, including
that the signature of the General Partner shall bind the Incubator in every
matter.

            

            I hereby
confirm that Morris Laster and Yuri Shoshan have been authorized by the General
Partner to sign the agreement for the operation of a biotechnological incubator
by and between the Incubator and the Government of Israel on behalf of the State
of Israel, represented by the Chief Scientist and the Controller of the Ministry
of Industry, Trade, and Employment. The signature of each of these parties,
whether Morris Laster or Yuri Shoshan, on this agreement, without need for the
company’s seal or the printed name of the General Partner, binds the General
Partner and thereby also binds the incubator in every matter. In addition I
hereby verify the signatures of Morris Laster and Yuri Shoshan as
follows:

            

            
              
                	
                        Name

                      	 
      	
                        ID number

                      	 
      	
                        Signature

                      	 
      
	
                        Morris
      Laster

                      	 
      	
                        069455137

                      	 
      	
                        /s/
      Morris Laster

                      	 
      
	
                        Yuri
      Shoshan

                      	 
      	
                        321101347

                      	 
      	
                        /s/
      Yuri
      Shoshan

                      	 
      

              

            

            

            Sincerely
yours,

            /s/ Barry
Levenfeld

            

            Barry
Levenfeld, attorney-at-law

            
              
                 

              

              
                 

                
                  

                

              

              
                 

              

            

             

            Appendix
A: Operating Plan

            
              Office
of the Chief Scientist, Technological Incubators Administration

              Approved
Chief Scientist Budget for an Incubator as a Pilot

              

              Name of
incubator: BioLine Innovations Jerusalem   Date:

              Name of
incubator corporation:  File No.: 35583

              

              Implementation
period (for six years): From Jan. 1, 2005 to Dec. 31, 2010–04–22

              

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  	
                                                                                          A

                                                                                        	 
      	
                                                                                          Personnel costs

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                          Total

                                                                                          cost,

                                                                                          first
      

                                                                                          year

                                                                                        	 
      	
                                                                                          Total

                                                                                          cost,

                                                                                          2nd

                                                                                          year

                                                                                        	 
      	
                                                                                          Total

                                                                                          cost,

                                                                                          3rd

                                                                                          year

                                                                                        	 
      	
                                                                                          Total

                                                                                          cost,

                                                                                          4th

                                                                                          year

                                                                                        	 
      	
                                                                                          Total

                                                                                          cost,

                                                                                          5th

                                                                                          year

                                                                                        	 
      	
                                                                                          Total

                                                                                          cost,

                                                                                          6th

                                                                                          year

                                                                                        	 
      	
                                                                                          Total

                                                                                          Budget

                                                                                          for 6

                                                                                          years

                                                                                        	 
      
	 
      	 
      	
                                                                                          Surname

                                                                                        	 
      	
                                                                                          Given

                                                                                          name

                                                                                        	 
      	
                                                                                          Position

                                                                                        	 
      	
                                                                                          NIS
      per month

                                                                                        	 
      	
                                                                                          FTE
      (%)

                                                                                        	 
      	
                                                                                          Months
      employed (1st year)

                                                                                        	 
      	
                                                                                          Months
      employed (2nd year)

                                                                                        	 
      	
                                                                                          Months
      employed (3rd year)

                                                                                        	 
      	
                                                                                          Months
      employed (4th year)

                                                                                        	 
      	
                                                                                          Months
      employed (5th year)

                                                                                        	 
      	
                                                                                          Months
      employed

                                                                                          (6th
      year)

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          1

                                                                                        	 
      	
                                                                                          Savitsky

                                                                                        	 
      	
                                                                                          Kinneret

                                                                                        	 
      	
                                                                                          CEO

                                                                                        	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          2

                                                                                        	 
      	
                                                                                          Ron

                                                                                        	 
      	
                                                                                          Hannah

                                                                                        	 
      	
                                                                                          VP

                                                                                        	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          3

                                                                                        	 
      	
                                                                                          Kelper

                                                                                        	 
      	
                                                                                          Leah

                                                                                        	 
      	
                                                                                          VP

                                                                                        	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          4

                                                                                        	 
      	
                                                                                          To
      be determined

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	 
      	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          5

                                                                                        	 
      	
                                                                                          Binyamin

                                                                                        	 
      	
                                                                                          Eran

                                                                                        	 
      	
                                                                                          Lab
      director

                                                                                        	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          6

                                                                                        	 
      	
                                                                                          Levin

                                                                                        	 
      	
                                                                                          Chen

                                                                                        	 
      	
                                                                                          Adm.
      Director

                                                                                        	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          7

                                                                                        	 
      	
                                                                                          Yunai

                                                                                        	 
      	
                                                                                          Lilach

                                                                                        	 
      	
                                                                                          Secretary

                                                                                        	 
      	 
      	 
      	
                                                                                          100%

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	
                                                                                          12

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          8

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          9

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                          Reserve
      for inflation

                                                                                        	 
      	
                                                                                          3%

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          B

                                                                                        	 
      	
                                                                                          Subcontractors:
      Company and service

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                          Total
      Personnel

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                          1

                                                                                        	 
      	
                                                                                          Payments
      to members of advisory scientific council

                                                                                        	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

               

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                	
                                                                        2

                                                                      	 
      	
                                                                        Legal
      counsel

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        3

                                                                      	 
      	
                                                                        PR

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        4

                                                                      	 
      	
                                                                        Regulatory
      counsel

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        5

                                                                      	 
      	
                                                                        Payments
      to medical experts

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        6

                                                                      	 
      	
                                                                        Bookkeeping
      and accountant

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        7

                                                                      	 
      	
                                                                        Intellectual
      property counsel

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        8

                                                                      	 
      	
                                                                        Program
      support

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        C

                                                                      	 
      	
                                                                        Equipment
      – Item/Type

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                        Total
      Services

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        1

                                                                      	 
      	
                                                                        Office
      equipment

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        2

                                                                      	 
      	
                                                                        Computer
      and network

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        3

                                                                      	 
      	
                                                                        Software

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        4

                                                                      	 
      	
                                                                        Setting
      up central lab

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        5

                                                                      	 
      	
                                                                        Setting
      up offices

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        6

                                                                      	 
      	
                                                                        Office
      furniture

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        D

                                                                      	 
      	
                                                                        Miscellaneous

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                        Total
      equipment

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        1

                                                                      	 
      	
                                                                        Rent
      and upkeep

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        2

                                                                      	 
      	
                                                                        Municipal
      services

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        3

                                                                      	 
      	
                                                                        Communications

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        4

                                                                      	 
      	
                                                                        Vehicles
      for executives

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        5

                                                                      	 
      	
                                                                        Upkeep
      of central lab

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        6

                                                                      	 
      	
                                                                        Subscriptions
      to journals and databases

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                        E

                                                                      	 
      	
                                                                        Marketing

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                        Total
      miscellaneous

                                                                      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      

                                                              

                                                            

                                                             

                                                            
                                                              
                                                                
                                                                

                                                              

                                                              
                                                                
                                                                

                                                                
                                                                  

                                                                

                                                              

                                                              
                                                                
                                                                

                                                              

                                                            

                                                             

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  
                                                                                    
                                                                                      
                                                                                        
                                                                                          
                                                                                            	
                                                                                                    1

                                                                                                  	 
      	
                                                                                                    Attendance
      at conferences

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                                    2

                                                                                                  	 
      	
                                                                                                    Sponsorship
      of conferences

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                                    3

                                                                                                  	 
      	
                                                                                                    Travel

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                                                                                                    4

                                                                                                  	 
      	
                                                                                                    Producing
      marketing materials

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                                    Total
      marketing

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                                                                                                    Signatures

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                                    Total
      Budget

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                                                                                                    <rubber
      stamp>

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                                    Total
      grant to set up lab

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                                                                                                    (illegible)

                                                                                                    Incubator
      director

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	
                                                                                                    ???
      less grant to set up lab

                                                                                                  	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      

                                                                                          

                                                                                        

                                                                                      

                                                                                    

                                                                                  

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

               

              Appendix
B: Incorporation
Data of the Company:

              

              BioLine
Innovations Jerusalem is a limited partnership, fully controlled (100%) by
BioLineRx Ltd. The general partner is BioLine Innovations Jerusalem, a limited
corporation established by BioLineRx Ltd. The limited partner is BioLineRx
Ltd.

              

              Data
of the shareholders in the Incubator (clause 6.1)

              

              Below is
a list of the shareholders in BioLineRx Ltd.:

              

              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            	
                                                    Shareholder’s

                                                    name

                                                  	 	
                                                    Place of

                                                    incorporation/

                                                    citizenship

                                                  	 	
                                                    Address

                                                  	 	
                                                    Number of shares

                                                  	 	 	
                                                    Percent of

                                                    holdings

                                                  	 
	
                                                    Teva

                                                    Pharmaceutical

                                                    Industries

                                                  	 	
                                                    Israel

                                                  	 	
                                                    P.O.
      Box 3190, 5 Basel St., Petach Tikva

                                                  	 	 	3,000,000	 	 	 	18.83	%
	
                                                    Giza
      Venture Capital

                                                  	 	
                                                    Israel

                                                  	 	
                                                    40
      Einstein St., Ramat Aviv Tower, P.O. Box 17672, Tel Aviv

                                                  	 	 	3,000,000	 	 	 	18.83	%
	
                                                    Pitango
      Venture Capital

                                                  	 	
                                                    Israel

                                                  	 	
                                                    11
      HaMenofim St., Herzliyya Pituach

                                                  	 	 	3,000,000	 	 	 	18.83	%
	
                                                    Hadasit
      Ltd.

                                                  	 	
                                                    Israel

                                                  	 	
                                                    P.O.
      Box 121000, Hadassah Ein Kerem, Jerusalem

                                                  	 	 	2,000,000	 	 	 	12.55	%
	
                                                    STAR
      Ventures

                                                  	 	
                                                    Israel/Germany

                                                  	 	
                                                    11
      Galgalei HaPlada, 3rd floor, Herzliyya Pituach

                                                  	 	 	1,500,000	 	 	 	9.41	%
	
                                                    Yehuda
      Zisapel

                                                  	 	
                                                    Israel

                                                  	 	
                                                    24
      Raoul Wallenberg St., building C, Tel Aviv

                                                  	 	 	750,000	 	 	 	4.71	%
	
                                                    Jerusalem
      Development Authority

                                                  	 	
                                                    Israel

                                                  	 	
                                                    Municipal
      Compound, 2 Safra Square, P.O. Box 32226, Jerusalem

                                                  	 	 	400,000	 	 	 	2.51	%
	
                                                    Options
      and shares to be distributed to employees

                                                  	 	 
      	 	 
      	 	 	2,285,024	 	 	 	14.34	%

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

               

              
                
                   

                

                
                   

                  
                    

                  

                

                
                   

                

              

              
                 

                Appendix
C: Bank Guarntee

                 

              

              Bank
Guarantee

              055892

              

              Guarantee
No.
741-097800/55-30–0841-0002/4

              Date:
Oct. 20, 2004

              

              To: State
of Israel

              via the
Office of the Chief Scientist

              Ministry
of Industry and Trade

              

              Dear Sir
or Madame

              

              
                	
                        1.

                      	
                        With
      regard to the agreement between the State of Israel and BioLine Rx, Ltd.
      (hereinafter “the Guaranteed”) (hereinafter “the Agreement”) and pursuant
      to Guideline No. 8.4 (Technological Innovation Centers—Biotechnology
      Incubators) issued by the director general of the Ministry of Industry and
      Trade, and at the request of the Guaranteed, we hereby guarantee to you
      payment of any sum, up to the “Amount of the Guarantee” (as defined
      below), relevant at the date of your demand, on condition that the total
      amount of all payments made to you under the present guarantee not exceed
      the Amount of the Guarantee as at the relevant
  date.

                      

              

              The
“Amount of the Guarantee” means the sum of NIS 8,100,0900.00 (eight million one
hundred thousand sheqels) only; but at any time that we receive notification
from you that the Incubator has made an approved outlay of at least
NIS 500,000 (“Approved Outlay”), as at the date of the submission of said
notification to us, the Amount of the Guarantee will be reduced by half the
amount of the Approved Outlay. Notwithstanding, the Amount of the Guarantee will
not be reduced, at any time or in any circumstances, to less than
NIS 1,500,000 (one million and a half).

              The
Amount of the Guarantee will be linked to the Consumer Price Index as published
form time to time by the Central Bureau of Statistics and Economic Research,
with the following linkage terms:

              “The Base
Index” for the purposes of the present guarantee will be the index for September
2004 published on or around the fifteenth of the following month, which is 100.6
points (based on 2002).

              “The New
Index” for the purpose of the present guarantee will be the most recently
published index before receipt of your demand for payment under this
guarantee.

              Linkage
differentials for the present guarantee will be calculated as follows: If the
new index is higher than the base index, the linkage differential will be a sum
equal to the ratio of the new index to the base index times the Amount of the
Guarantee, divided by the base index. If the new index is lower than the base
index, we will pay you the sum stated in your demand, up to the Amount of the
Guarantee, with no linkage differentials.

              
                	
                        2.

                      	
                        The
      Amount of the Guarantee will be paid to you within 10 days of our receipt
      of your first demand in writing, and you shall be under no obligation to
      prove your demands, nor shall we assert against you any defense that might
      be available to the party requesting this guarantee with regard to the
      debt to you and without your being required to first demand request the
      Amount of the Guarantee from the
Guaranteed.

                      

              

              
                
                   

                

                
                   

                  
                    

                  

                

                
                   

                

              

              
                	
                        3.

                      	
                        This
      guarantee will remain in force until Dec. 31, 2004. After that time it
      will be null and void.

                      

              

              
                	
                        4.

                      	
                        Any
      demand pursuant to the guarantee must be submitted to us at the following
      address: Kanfei Nesharim 22,
Jerusalem.

                      

              

              
                	
                        5.

                      	
                        This
      guarantee cannot be transferred or
assigned.

                      

              

              

              
                Sincerely
yours,

              

              
                Bank
Leumi le’Yisrael

              

              
                Givat
Shaul Branch

              

              

              <rubber
stamp + /s/ Levana Arojas> Levana Arojas 3123

              <rubber
stamp + /s/ H. Barak > H. Barak 2732

              
                
                   

                

                
                   

                  
                    

                  

                

                
                   

                

              

               

              Bank
Guarantee

              089947

              

              Date:
Dec. 16, 2004

              

              Guarantee
No. 741-097800/55-30–0841-0002/4

              

              To: State
of Israel via the Office of the Chief Scientist

              Ministry
of Industry and Trade

              

              Our
guarantee to your credit, No. 741-097800/55-30–0841-0002/4

              

              Date:
Oct. 20, 2004

              In the
amount of 8,100,000.00 (eight million one hundred thousand new sheqels
only)

              For:
BioLine Rx Ltd.

              Valid
through Dec. 31, 2004

              

              We hereby
extend the validity of the above guarantee until March 31, 2011.

              

              Consequently,
any demand pursuant to said guarantee must reach the undersigned branch, whose
address is Jerusalem, Kanfei Nesharim 22, Givat Shaul, by said date, during the
hours when the branch is open to the public for business.

              

              A demand
that arrives after said time will not be honored.

              

              It is
emphasized that a “written demand” as stated above does not include a demand
sent to the bank by facsimile, telegram, or any other electronic medium and that
such will not be considered to be a demand for the purposes of the present
guarantee.

              

              There are
no changes to any other terms of the guarantee.

              

              
                Sincerely
yours,

              

              
                Bank
Leumi le’Yisrael

              

              
                Givat
Shaul Branch

              

              

              <rubber
stamp + /s/ Oshrit Bar-Gil> Oshrit Bar-Gil 5835

              <rubber
stamp + /s/ H. Barak> H. Barak 2732

              

              
                
                  
                     

                  

                  
                     

                    
                      

                    

                  

                  
                     

                  

                

              

              
                 

                
                  Appendix
D: List of criteria for choosing projects

                  

                  
                    	
                            1.

                          	
                            The
      project is for the development or improvement of a product or process
      which is intended for the global biotechnology
  market.

                          

                  

                   

                  
                    	
                            2.

                          	
                            The
      product or process is technologically
  innovative.

                          

                  

                   

                  
                    	
                            3.

                          	
                            A
      technical-economic and marketing examination has been performed and it
      shows that success is reasonably
probable.

                          

                  

                   

                  
                    	
                            4.

                          	
                            The
      duration of the project up until it is ready for the entry of an
      industrial partner or for raising capital for continued development and
      commercialization shall be up to three
years.

                          

                  

                   

                  
                    	
                            5.

                          	
                            All
      the of the project’s budget finance sources have been settled and there
      are no other governmental source of development financing for the project
      and/or incubator other than the state
loan.

                          

                  

                   

                  
                    	
                            6.

                          	
                            The
      project has passed an initial feasibility test as part of the academic
      research or in any other framework. Initial feasibility testing will not
      be done as part of this program.

                          

                  

                   

                  
                    	
                            7.

                          	
                            According
      to an examination, the project has the potential to achieve high returns.
      The maturity period for the project is long (approx. 10 years from the
      beginning of development until it reaches the market). The project is
      capable of raising external capital within 3 years. The technological risk
      of the project is high and the lion’s share of the research and
      development shall be done as part of and in the framework of the
      incubator.

                          

                  

                   

                

                
                  
                    
                       

                    

                    
                       

                      
                        

                      

                    

                    
                       

                    

                  

                

                
                  

                  Appendix
E: Bond for a type 2 biotechnological incubator

                  

                  Issued on
the _______ day of the month of _________ in the year _______ by
________________________

                  (hereinafter
“the Incubator”)

                  

                  with the
State of Israel (hereinafter “the State”) as the beneficiary

                  

                  

                  
                    	
                            Whereas

                          	
                            to
      ensure the repayment of all sums that the Incubator owes and/or from time
      to time may owe the State for the State’s loans to the Incubator to enable
      the execution of Incubator projects, and to ensure that the Incubator
      fulfills in full and on time its obligations to the State according to the
      agreement whereby it shall operate an industrial research and development
      entrepreneurial center under incubator conditions, an agreement between
      the Incubator and the State that was drawn up and signed on (date)
      _____________ (hereinafter “the Agreement”), the
      Incubator hereby encumbers and mortgages all its assets through this bond,
      in a senior floating lien with the State as a beneficiary, and hereby
      assigns all its assets to the State through a floating
    lien.

                          

                  

                  

                  
                    	
                            Whereas

                          	
                            according
      to provision no. 8.4 of the director general of the Ministry of Industry
      and Trade issued on May 2, 2004 (hereinafter "the Director General's
      Provision") and
      according to the agreement the Incubator is and/or will be eligible to
      receive a loan (hereinafter "the Loan") from the
      State for a Project company and/or a project, as defined in the agreement,
      for purposes of executing the Project, as specified by law and as
      specified in the Director General’s
provisions;

                          

                  

                  

                  
                    	
                            And
      whereas

                          	
                            the
      State has approved the Incubator’s request for funding, in keeping with
      the certificate of approval, as defined below, and in keeping with the
      agreement;

                          

                  

                  

                  
                    	
                            And
      whereas

                          	
                            as
      a condition of receiving the loan, the Incubator committed itself to
      encumbering the encumbered assets of the Project, as defined in clause
      5.14 of the Director General’s Provision, with the State as the
      beneficiary;

                          

                  

                  

                  It is
accordingly stipulated in the bond as follows:

                  

                  
                    	
                            1.

                          	
                            The
      preamble to this bond (hereinafter "the Bond" or "the Certificate of
      Encumbrance") and the accompanying appendices are inseparable parts
      of the Bond.

                          

                  

                  
                    	
                            2.

                          	
                            In
      this Certificate of Encumbrance the following terms shall have the
      following meanings:

                          

                  

                  
                    	
                          	
                            2.1

                          	
                            Approved
      plan: The plan with all its conditions as it was approved by the
      Committee on Biotechnological Incubators (hereinafter: “the Committee”) and for
      whose execution the Incubator has received and/or is eligible to receive a
      loan pursuant to the agreement.

                          

                  

                  
                    	
                          	
                            2.2

                          	
                            Certificate
      of Approval: A certificate to be signed by the Chief Scientist, for
      the purpose of funding an Incubator Project as defined in the
      agreement.

                          

                  

                  
                    	
                          	
                            2.3

                          	
                            Project:
      as defined in the agreement.

                          

                  

                  
                    	
                            3.

                          	
                            In
      every instance in which there is a contradiction between the provisions of
      this Bond and the provisions of the Agreement, the provisions of the Bond
      will override those of the Agreement. Notwithstanding, it is stipulated
      that the realization of the Bond and lifting of the lien on the assets
      will be subject to the provisions of the
  Agreement.

                          

                  

                  
                    
                       

                    

                    
                       

                      
                        

                      

                    

                    
                       

                    

                  

                  

                  
                    	
                            4.

                          	
                            The
      section headings in this Bond are meant exclusively for ease of reading
      and are not to be used in its
interpretation.

                          

                  

                  
                    	
                            5.

                          	
                            This
      Certificate of Encumbrance guarantees and shall guarantee the full and
      exact repayment of all sums of the loan and other sums that the Incubator
      is to repay to the State and, without derogating from the generality
      thereof, principal, interest, linkage differentials, guarantees, fees,
      expenses, realization expenses, legal expenses, and so
    forth.

                          

                  

                  
                    	
                            6.

                          	
                            As
      collateral for the full and exact repayment of all the guaranteed sums and
      by virtue of clauses 165–166 of the Companies Ordinance of 1983 (new
      version), and/or by virtue of any other legal provision the Incubator
      hereby encumbers the Incubator’s assets with a senior floating lien. The
      lien applies to the Incubator’s assets in both their current and any
      future states, including a restriction on the transfer and/or licensing of
      the rights to the technologies that were produced by the projects during
      their period in the Incubator; the lien also applies to any equipment that
      is purchased for use by the Project (hereinafter “the Encumbered
      Property”).

                          

                  

                  
                    	
                            7.

                          	
                            The
      Incubator hereby declares and confirms that there are no other attachments
      or liens or encumbrances or mortgages on the Encumbered Property or any
      part of it, or any undertaking to create any such lien or encumbrance or
      mortgage.

                          

                  

                  
                    	
                            8.

                          	
                            The
      Incubator hereby undertakes to ensure that the lien it has created through
      this Certificate of Encumbrance shall be recorded in the Register of Liens
      of the Registrar of Companies and/or the Registrar of Liens and/or in any
      other relevant register (hereinafter: “the Registrar”) within
      the legal time frame. The Incubator also agrees to sign at the State’s
      request any document, letter, request, or similar document addressed to
      any agency for purposes of registering the lien in any
      register.

                          

                  

                  
                    	
                            9.

                          	
                            The
      Incubator agrees that the lien that is registered by the Registrar in the
      Register of Liens as stated above shall not be removed from the said
      Register of Liens until such time as the State provides it with a written
      declaration to the effect that it agrees to remove the
    lien.

                          

                  

                  
                    	
                            10.

                          	
                            The
      State shall be entitled to realize the lien, with itself as the
      beneficiary, without any need for the Incubator’s consent. The State shall
      inform the Incubator of its intent to realize the lien thirty (30) days
      before doing so.

                          

                  

                  
                    	
                            11.

                          	
                            The
      Incubator undertakes to do the
following:

                          

                  

                  
                    	
                          	
                            11.1

                          	
                            To
      insure the physical Encumbered Property beginning from the date this bond
      is signed and at all times at its full value as is the practice with
      physical property, against all risks for which similar physical assets are
      insured, with an insurance company registered in Israel that is legally
      authorized to sell insurance. The Incubator also undertakes to inform the
      said insurance company of any notice or instruction regarding the
      assignment of the rights accruing to the State from the insurance policies
      of which the State is the beneficiary, according to a formulation that is
      approved by the State. This formulation shall include among other
      provisions an irrevocable order to the said insurance company to pay all
      sums that the Incubator is or shall be entitled to collect on account of
      all or any part of the encumbered property exclusively to the State and/or
      to the State’s designated recipient. In addition, the Incubator undertakes
      to submit to the State confirmation from the said insurance company that
      it has received the above-mentioned order and that it agrees to abide by
      it, and that it also undertakes to give the State notice by registered
      mail about any change or cancellation or expiration of any insurance
      policy at least thirty (30) days in advance. The Incubator undertakes not
      to introduce changes into any of its insurance policies without the
      State’s approval. The Incubator also undertakes to extend the validity of
      its insurance policies from time to time as necessary throughout the
      period of the lien, even without any request or demand from the
      State.

                          

                  

                  
                    
                       

                    

                    
                       

                      
                        

                      

                    

                    
                       

                    

                  

                  

                  
                    	
                          	
                            11.2

                          	
                            To
      fulfill all the conditions of the insurance policies mentioned in clause
      11.1 above and to comply with all their restrictions, and to submit copies
      of all the aforesaid policies to the State. In the event that the State
      asks the Incubator to introduce any revisions into the insurance policies
      the Incubator undertakes to make these
  revisions.

                          

                  

                  
                    	
                          	
                            11.3

                          	
                            To
      preserve the physical Encumbered Property and to maintain it in good
      working condition, to use it carefully, and to inform the State
      immediately of any instance of substantive damage to and/or substantive
      malfunction of and/or substantive defect in the property, and to
      immediately repair any damage to and/or malfunction of and/or defect that
      occurs in the Encumbered Property for any reason, and to enable the
      State’s or the Committee’s representatives to check the condition of the
      Encumbered Property at any time.

                          

                  

                  
                    	
                          	
                            11.4

                          	
                            Not
      to remove the physical Encumbered Property or any part of it from the
      premises of the Incubator building without the State’s written agreement
      in advance, with the exception of the temporary removal of the Encumbered
      Property for the exclusive purpose of repairing
  it.

                          

                  

                  
                    	
                          	
                            11.5

                          	
                            Not
      to sell, rent, give, transfer, and/or assign all or any part of the
      Encumbered Property to any third party whatsoever without receiving prior
      written consent from the State or pursuant to the provisions of the
      Agreement.

                          

                  

                  
                    	
                          	
                            11.6

                          	
                            To
      immediately inform the State of the imposition of any attachment, the
      implementation of any action, the execution of any judgment, or the
      submission of a request for the appointment of a receiver for all or part
      of the Encumbered Property, and also to immediately notify any agency
      and/or third party that has imposed any such attachment or taken any such
      action. In addition, the Incubator undertakes to immediately perform at
      its own expense any action that may be required to rescind the attachment
      and/or revoke and/or cancel the action, as
  relevant.

                          

                  

                  
                    	
                          	
                            11.7

                          	
                            The
      Incubator undertakes not to mortgage and/or encumber all or any part of
      the Encumbered Property to any third party with any other or additional
      lien and/or mortgage, whether prior, equal, subsequent, or junior, or any
      other encumbrance without receiving prior written permission from the
      State.

                          

                  

                  
                    	
                            12.

                          	
                            After
      the full balance of the State loan for a certain project has been repaid
      (as specified in clause 13 of the agreement), those assets of the Project
      that were encumbered with regard to the said project shall be removed from
      the scope of the lien, pursuant to clause 12.3 of the Agreement. The State
      undertakes to deduct the sum that corresponds to the lien from the
      relative portion of the State loan, in keeping with the procedures of the
      technological incubators program of the Chief Scientist’s Office. In
      addition, the State shall deduct the sum that corresponds to the lien from
      the relative portion of the State loan that corresponds to the encumbered
      assets, in proportion to the sums that were not transferred to the Project
      and were returned to the State, or that were not transferred to projects
      that were shut down and/or that failed, in keeping with the procedures of
      the technological incubators program of the Chief Scientist’s
      Office.

                          

                  

                  
                    	
                            13.

                          	
                            The
      Incubator hereby grants the State irrevocable power of attorney to carry
      out in its name, on its behalf, and at its expense any of the following
      activities: to file any suit against the insurance companies with regard
      to the insurance of all or part of the physical Encumbered Property, and
      to reach agreement with the insurance companies regarding the suits
      against them as the State sees fit, after notifying the Incubator,
      including agreements that constitute a compromise on or waiver of the
      Incubator’s rights, all or in part, and to sign an arbitration agreement
      and collect the insurance monies. The State shall have the right to
      undertake any of the aforementioned actions whether the insurance policy
      was/will be taken out by the Incubator or in its name or whether it
      was/will be taken out by the
State.

                          

                  

                  
                    
                       

                    

                    
                       

                      
                        

                      

                    

                    
                       

                    

                  

                  

                  
                    	
                            14.

                          	
                            This
      lien shall in no way detract from any of the State’s rights to collect the
      guaranteed sums, in whole or in part, in ways other than by realizing its
      rights according to this Bond, and the realization of the State’s rights
      according to this Bond shall in no way detract from the State’s right to
      collect from the Incubator the balance of the guaranteed sums that were
      not repaid by realization of the lien that is the subject of this
      bond.

                          

                  

                  
                    	
                            15.

                          	
                            The
      State shall be entitled to appoint a receiver and/or a liquidator and/or a
      special director and/or a trustee (“the Receiver”) for
      purposes of realizing the lien at its absolute and exclusive discretion,
      after it has given the Incubator prior warning of 30 days. In addition, if
      so requested the Incubator shall approve the fact of the appointment
      and/or the identity of the State’s choice of
  appointees.

                          

                  

                  
                    	
                            16.

                          	
                            No
      waiver, discount, failure to take timely action, or extension granted by
      the State or on its behalf shall be considered a waiver of any sort of the
      State’s rights under this Certificate of Encumbrance, and shall in no way
      impede the State or its representatives from filing suit or undertaking
      any other procedure. Any concession by the State regarding any previous
      breach by the Incubator or previous failure to fulfill one or more of its
      obligations under this Bond and/or under the Agreement shall not be
      considered to justify some other breach and shall not constitute a
      precedent and/or leave for the Incubator to commit another
      breach.

                          

                  

                  
                    	
                            17.

                          	
                            The
      books and accounts of the State and/or the Committee or the books and
      accounts of an organization or organizations that the State designates to
      pay out the loan (all or in part) to the Incubator shall be considered
      trustworthy by the Incubator and shall serve at any time as prima facie
      evidence against it with regard to sums the Incubator must repay and/or
      pay the State.

                          

                  

                  
                    	
                            18.

                          	
                            In
      order to remove all doubt, the Incubator hereby declares and confirms that
      none of the provisions of this Certificate of Encumbrance in any way
      detracts from any of the Incubator’s obligations under the law or under
      any regulation that has been issued or rule that has been instituted in
      accordance with the law or according to any agreement that was made and/or
      shall be made between the State and the Incubator and/or according to any
      document that was and/or shall be signed by the Incubator with the State
      as the beneficiary.

                          

                  

                  
                    	
                            19.

                          	
                            The
      Incubator’s address for the purposes of this Certificate of Encumbrance is
      the address of its office listed
above.

                          

                  

                  
                    	
                            20.

                          	
                            All
      of the expenses involved in drawing up, signing, implementing, and
      realizing this Certificate of Encumbrance and everything connected with it
      shall be paid by the Incubator to the State at its first request, with
      interest.

                          

                  

                  
                    	
                            21.

                          	
                            The
      legal jurisdiction for this bond is hereby declared to be the competent
      court in the Jerusalem district; but the State shall be entitled to take
      legal action against the Incubator on all matters that pertain to this
      Certificate of Encumbrance in any other competent court as
      well.

                          

                  

                  
                    	
                            22.

                          	
                            No
      revision and/or update of any of the provisions of this bond shall be
      valid unless it is executed in writing and signed by both
      sides.

                          

                  

                  

                  In
witness whereof we hereby affix our signatures:

                  

                  The Incubator:
___________________

                  

                  By the
authorized signatories:

                  

                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        	
                                                Name

                                              	 
      	
                                                Identity
      card no.

                                              	 
      	
                                                Position

                                              	 
	 
      	 
      	 
      	 
      	 
      	 
      	 
	
                                                1.

                                              	 
      	 
      	 
      	 
      	 
      	 
	 
      	 
      	 
      	 
      	 
      	 
      	 
	
                                                2.

                                              	 
      	 
      	 
      	 
      	 
      	 

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                  
                    
                       

                    

                    
                       

                      
                        

                      

                    

                    
                       

                    

                  

                   

                

              

              Appendix
F: Format for confirmation/release of the Project [by the State of
Israel]

              

              Date:_________

              To: BioLine Innovations
Jerusalem Limited Partnership

              

              Dear Sir
or Madam:

              

              Re: Confirmation of
repayment of the State loan for the “_____________________”
project

              

              In
keeping with clause 12.3 of the agreement signed between us on _____________
(hereinafter: “the Incubator
Agreement”), we hereby confirm as follows:

              

              
                	
                        1.

                      	
                        The
      full amount of the State loan that was extended to you in connection with
      the project at issue (hereinafter: “the Project”) has been
      repaid in keeping with the conditions of the Incubator
      agreement.

                      

              

              
                	
                        2.

                      	
                        Any
      lien that was placed with us as a beneficiary with regard to the Incubator
      agreement shall no longer apply to the Project and all the assets and
      rights connected with it.

                      

              

              
                	
                        3.

                      	
                        As
      of the date of this letter, there shall no longer be any
      limitation—according to the Incubator Agreement and/or any lien that was
      placed with us as a beneficiary—on the Project and its assets and their
      transfer, sale, licensing and so forth, all subject to the restrictions
      that apply according to the Research and Development Law and subject to
      clause 7.1 of the director general’s
provisions.

                      

              

              

              Respectfully
yours,

              

              Director
of the Incubators Project

              Office of
the Chief Scientist

              The State
of Israel

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