Document:

Unassociated Document

    Exhibit
10.9

     

    EMPLOYMENT
AGREEMENT

     

    THIS
AGREEMENT, is made on June 28, 2007, by and between, Q.B.I. Enterprises Ltd.
(the “Company”) and Dr. Elena Feinstein, (the “Executive”);

     

    WITNESSETH
THAT:

     

    WHEREAS,
the Executive is currently an employee of the Company pursuant to an employment
agreement between the Executive and the Company dated December 15, 1997, as
amended form time to time, (the “Prior Agreement”);

     

    WHEREAS,
the Company and the Executive desire to amend and document the terms of
employment of the Executive effective as of May 1, 2007(the “Effective
Date”);

     

    NOW,
THEREFORE, in consideration of the mutual covenants and agreements set forth
below and other good and valuable consideration, the receipt of which is hereby
acknowledged, the Executive and the Company hereby agree as
follows:

     

    1.           Performance of
Services. The Executive’s employment with the Company shall be subject to
the following:

     

    (a)           Subject
to the terms of this Agreement, the Company hereby agrees to employ the
Executive in the position of Chief Scientific Officer of the Company. The
Executive shall also be employed by the Company’s parent company Quark
Pharmaceuticals, Inc. (“Quark”) under a separate agreement.

     

    (b)           While
the Executive is employed by the Company, the Executive shall devote her full
time and best efforts, energies and talents to serving the Company and Quark, in
accordance with this agreement and the agreement with Quark. Services rendered
by the Executive to Quark shall not be considered contrary to or in breach of
this Agreement and shall be subject to a separate agreement between Quark and
Executive (the “Quark Agreement”). Apart from rendering services to Quark, as
indicated above, Executive shall not be engaged in any other employment nor
engage in any other business activities for any other person, firm or company
without the prior written consent of the Company and provided that Executive
utilizes her vacation days (subject to clause 2 (g)- Vacation) for such
engagement and such engagement will not be on account of the time that Executive
has undertaken under this Agreement as Company Executive Company hereby grants
Executive consent to engage in a Consultant Agreement with Cleveland BioLabs,
Inc. (“Cleveland BioLabs”) dated May 1, 2007 for the projects listed in Exhibit
A to the Consultancy Agreement (the “Exhibit A to Consultant Agreement”). The
Exhibit A to Consultant Agreement is attached hereto as Exhibit A. Such consent
is subject to the following: Company shall have full control over Exhibit A and
at its sole discretion shall have the right to instruct Consultant to terminate
providing her services to Cleveland BioLabs on the activities and projects that
are listed in Exhibit A if they become directly competing with the business of
Company. Any Modifications to Exhibit A shall require the prior written consent
of Company and Executive is responsible to give immediate notice to Company of
the intention to implement such Modification in order to provide Company the
opportunity to decide if such services compete directly with the business of
Company. Modifications to Exhibit A shall include without limitation: adding new
services to the list, changing the existing services or the Company decides that
such services (existing or new) compete directly with the business of the
Company (the “Modifications”).

    
      
         

      

      
        1.

        
          

        

      

      
         

      

    

     

    (c)           The
Executive shall report to the Chief Executive Officer of the Company and of
Quark (the “CEO”) and shall perform the duties, undertake the responsibilities
and exercise the authority customary for an employee in the Executive’s position
and shall perform such additional duties as may be assigned to him by the
CEO.

     

    (d)           The
Executive agrees that she shall perform her duties faithfully and efficiently
subject to the direction of the CEO. The Executive’s duties shall include
providing services for both the Company and its Affiliates (as defined below) as
determined by the Company. For purposes of this Agreement, the term “Affiliate”
shall mean Quark and any corporation, partnership, joint venture or other entity
in which at least a fifty percent interest in such entity is owned, directly or
indirectly, by Quark or the Company.

     

    (e)           The
Executive’s place of employment shall be in Israel, provided that the Company
may require the Executive to travel outside Israel in order to fulfill her
duties with the Company and Quark.

     

    (f)           The
Executive’s position is a “senior managerial position”, as defined in the
Israeli Work and Rest Hours Law, 1951, and requires a high level of trust.
Accordingly, the provisions of said law shall not apply to the Executive and the
Executive agrees that she may be required to work beyond the regular working
hours of the Company, for no additional compensation other than as specified in
this Agreement.

     

    (g)           The
employment of the Executive under this Agreement shall commence on the Effective
Date and shall continue until terminated in accordance with the provisions of
Section 3 below (the “Employment Period”).

     

    2.           Compensation and
Benefits. Subject to the terms of this Agreement, during the Employment
Period, the Company shall compensate the Executive for her services as
follows:

     

    (a)           Base Salary. The
Executive shall receive base salary at an annual rate of $100,000 U.S. Dollars
payable in equal installments on the regular employment payroll dates of the
Company, calculated in accordance with the representative rate of exchange of
the NIS against the Dollar published by the Bank of Israel as in effect on the
last day of the month in respect of which the salary is paid, inclusive of
travel expenses to which the Executive is entitled in accordance with applicable
laws. Said salary and travel expenses shall be paid in arrears by the 9th day of
each month in respect to a preceding month in which the Executive was in
employment (the “Salary”), The Salary will be adjusted from time to time in
accordance with the cost of living increments (Tossefet Yoker) which apply
to all Employees in Israel.

     

    (b)           Stock Awards. If an
award in the form of a stock options (“Stock Options”) is granted to the
Executive, it will be made in accordance with the terms and principles detailed
in Quark’s Stock Option Plan for Israeli Employees. The Stock Options will be
granted under Quark’s standard stock option agreement for Company employees to
be entered into between the Executive and Quark.

    
      
         

      

      
        2.

        
          

        

      

      
         

      

    

     

    (c)           Managers’ Insurance and
Pension Fund. During the Employment Period, the Company shall take out a
Managers’ Insurance (Bituach
Menahalim) and Pension Fund (Keren Pensya) policy and
shall contribute thereto, on a monthly basis, 18.33% of the Executive’s monthly
Salary, 8.33% of which shall be in respect of severance compensation (the
“Severance Component”), 5% of which shall be in respect of pension, and 5% of
which shall be deducted by the Company from the monthly payment of the
Executive’s Salary as the Executive’s contribution to said Managers’ Insurance
and Pension Fund. The parties acknowledge and agree that in accordance with
Section 14 to the Severance Pay Law 5723-1963, the allocation to Managers’
Insurance and Pension Fund under this Section 2(c) shall be in lieu of severance
pay according to the Severance Pay Law that Executive may be entitled
to.

     

    (d)           Disability. During
the Employment Period, the Company shall take out Disability Insurance (Ovdan Kosher Avoda) as in
effect immediately prior to the Effective Date and contribute thereto, on a
monthly basis, 2.5% of the Executive’s monthly Salary.

     

    (e)           Education Fund.
During the Employment Period, the Company shall contribute to an Education Fund
(Keren Hishtalmut), on
a monthly basis, 7.5% of the Executive’s monthly Salary, subject to the
Executive’s contribution of an additional 2.5% of her monthly Salary. All tax
obligations related to the Education Fund shall be borne by the
Executive.

     

    (f)           Recreation Funds.
During the Employment Period, the Company shall provide and pay the Executive
Recreation Funds (Dmei
Havra’ah) at the rate required by applicable law and
regulations.

     

    (g)           Vacation. During each
calendar year during the Employment Period, the Executive shall be entitled to
14 working days of vacation (or a pro rata number of days for any partial year
that occurs during the Employment Period) determined in accordance with
applicable employment laws of Israel and Company policies on dates to be
coordinated with the Company in advance. The Executive shall not be entitled to
receive from the Company any Sabbatical Year Leave. The Executive has
accumulated up until November 2003: 81.76 vacation days. These days will not be
brought into account when calculating the 28 days per year that the Executive is
entitled to accumulate according to Company policy.

     

    (h)           Sick Leave. The
Executive shall be entitled to sick leave pursuant to the Sick Pay Law -
1976.

     

    (i)           Use of Company Car.
During her employment with the Company hereunder, the Executive shall have the
use of a Company car free of charge. Any income tax which may be assessed on
such use of the car shall be for the account of the Company. The Executive will
be responsible for the payment of fines (if any) imposed with respect to the use
of the car by her.

    
      
         

      

      
        3.

        
          

        

      

      
         

      

    

    (j)      
     Expenses. The Company
will pay or reimburse Executive for reasonable travel or other expenses incurred
by Executive in the furtherance of or in connection with the performance of
Executive’s duties hereunder in accordance with the Company’s established
policies (including reimbursement for telephone expenses). Executive shall
furnish the Company with evidence of the incurrence of such expenses within a
reasonable period of time from the date that they were incurred.

     

    (k)           Taxes. All sums
mentioned in this Agreement are pre-tax. The Executive shall bear and pay any
and all taxes imposed on her Salary, the Stock Options and any all benefits
hereunder.

     

    3.           Termination. The
Executive’s employment with the Company during the Employment Period may be
terminated under the following circumstances:

     

    (a)           Death. The
Executive’s employment hereunder shall terminate upon her death.

     

    (b)           Disability. If the
Executive becomes Disabled, the Company may terminate her employment with the
Company. For purposes of this Agreement, the Executive shall be deemed to be
“Disabled” if she has a physical or mental disability which renders her
incapable of performing substantially all of her duties hereunder for a period
of 90 days (which need not be consecutive) in any 12-month period. In the event
of a dispute as to whether the Executive is Disabled, the Company may, at its
expense, refer her to a licensed practicing physician of the Company’s choice
and the Executive agrees to submit to such tests and examination as such
physician shall deem appropriate. The determination of such physician shall be
final and binding on the Company and Executive.

     

    (c)           Cause. The Company
may terminate the Executive’s employment hereunder immediately and at any time
for Cause by written notice to the Executive detailing the basis for the Cause
termination. For purposes of this Agreement, “Cause” means (i) gross negligence
or willful failure by the Executive to perform her duties as an employee of the
Company (other than any such failure resulting from incapacity due to physical
or mental illness), (ii) willful misconduct by the Executive which is materially
injurious to the Company or its Affiliates, monetarily or otherwise, (iii) the
engaging by the Executive in egregious misconduct involving moral turpitude to
the extent that her creditability and reputation no longer conforms to the
standard of senior executives of the Company and its Affiliates, (iv) the
commission by the Executive of an act of dishonesty or breach of trust; or (v) a
material breach of this Agreement.

     

    (d)           Termination by
Executive. The Executive may terminate her employment hereunder at any
time for any reason by giving the Company prior written notice not less than 120
days prior to such termination.

     

    (e)           Mutual Agreement.
This Agreement may be terminated at any time by mutual written agreement of the
parties.

    (f)           Termination by the Company
without Cause. The Company may terminate the Executive’s employment
hereunder at any time for any reason by giving the Executive prior written
notice not less than 120 days prior to such termination. During the Notice
Period, the Executive will continue to be employed by the Company pursuant to
the terms of this agreement and to receive the Salary and other benefits
hereunder. Notwithstanding the above, the Company may, at any time during any
Notice Period, waive at its sole discretion, the Executives obligation to
continue in the employment of the Company and to forthwith terminate her
employment hereunder, by paying the Executive an amount equal to the Executive’s
Salary multiplied by the number of months remaining until the end of the
applicable Notice Period.

     

    
      
        
        

      

      
        4.

        
          

        

      

      
        
        

      

    

     

    (g)           Termination
of the Quark Agreement for any reason shall automatically give the Company the
right to terminate this Agreement simultaneously with the termination of the
Quark Agreement or at any time thereafter upon written notice by the Company to
Executive. In the event that Company decides to employ the Executive only in the
Company and not in Quark, Company may terminate the Quark Employment Agreement
whilst still continuing this Agreement. In the event that this Agreement is
continued it shall continue as a part time basis employment agreement and
Company shall negotiate any modifications to such Agreement if it desires to
employ the Executive on a full time basis.

     

    (h)           Date of Termination.
“Date of Termination” means the last day that the Executive is employed by the
Company under the terms of this Agreement under circumstances in which her
employment is terminated in accordance with one of the foregoing provisions of
this paragraph 3.

     

    4.           Rights Upon
Termination.

     

    (a)           In
the event of Termination for any reason, the Company shall:

     

    (i)           Pay
the Executive’s Salary for the period ending on the Date of
Termination.

     

    (ii)          Transfer
to the Executive, within 30 days following Date of Termination, any and all
allocations accrued under her Managers’ Insurance and Pension Fund and
Educational Fund.

     

    (b)           Notwithstanding
any provision of this Section 4 to the contrary, the Company shall have no
obligation to transfer or release the Severance Component of the Managers’
Insurance and Pension Fund in circumstances where Israeli laws denies the
Executive’s right to severance payment by pursuant to Sections 17 to the Israeli
Severance Payment Law 5723 - 1963.

     

    (c)           The
Company and Executive agree and acknowledge that in the event the Company
transfers ownership of the Manager’s Insurance and Pension Fund to the
Executive, that such transfer shall constitute the payment of any severance pay
the Company is required to pay to the Executive pursuant to the Severance Pay
Law (5727-1963).

     

    5.           Confidentiality and
Non-competition. In consideration for the payments and benefits
contemplated by Section 2, the Executive acknowledges and agrees that
simultaneous with the execution of this Agreement, she will be required to
execute and comply with the Non- competition and Proprietary Information
Agreement in the form attached to this Agreement as Exhibit B.

    
      
         

      

      
        5.

        
          

        

      

      
         

      

    

     

    6.           Representations and
Warranties.

     

    (a)           The
Executive represents and warrants that: (i) the execution and delivery of this
Agreement and the fulfillment of the terms hereof will not constitute a default
under or breach of any agreement or other instrument to which she is a party or
by which she is bound, including without limitation, any confidentiality or non
competition agreement, and do not require the consent of any person or entity,
(ii) she shall not utilize, during her employment with the Company any
proprietary information of any of her previous employers.

     

    (b)           The
Executive shall inform the Company, immediately upon becoming aware of every
matter in which she or a member of her immediate family or affiliate has a
personal interest or which might create a conflict of interests with her duties
to the Company.

     

    7.           Successors. This
Agreement shall be binding upon, and inure to the benefit of, the Company and
its successors and assigns and upon any person acquiring, whether by merger,
consolidation, purchase of assets or otherwise, all or substantially all of the
Company’s assets and business.

     

    8.           Notices. Notices and
all other communications provided for in this Agreement shall be in writing and
shall be delivered personally or sent by registered or certified mail, return
receipt requested, postage prepaid, or sent by facsimile or prepaid overnight
courier to the parties at the addresses set forth below (or such other addresses
as shall be specified by the parties by like notice):

     

    To the
Company:

     

    Q.B.I.
Enterprises Ltd.

    PO Box
741

    Nes Ziona
74106

    Israel

    Attn: Dr.
Daniel Zurr

     

    To the
Executive:

     

    Dr. Elena
Feinstein, at the most recent address shown in the records of the
Company.

     

    Notices
hereunder shall be deemed to be effective (a) upon receipt if delivered
personally, (b) on the tenth (10th) day following the date of mailing if sent by
registered or certified air mail; (c) on the second (2nd) day following the date
of transmission or delivery to the overnight courier if sent by overnight
courier; and (d) on the next day after the date sent by facsimile (with receipt
confirmation). A party may change its address listed above by sending notice to
the other party in accordance with this Section 8.

     

    9.           Severability. The
invalidity or unenforceability of any provision of this Agreement will not
affect the validity or enforceability of any other provision of this Agreement,
and this Agreement will be construed as if such invalid or unenforceable
provision were omitted (but only to the extent that such provision cannot be
appropriately reformed or modified).

    
      
         

      

      
        6.

        
          

        

      

      
         

      

    

     

    10.         Waiver of Breach. No
waiver of any party hereto of a breach of any provision of this Agreement by any
other party will operate or be construed as a waiver of any subsequent breach by
such other party. The failure of any party hereto to take any action by reason
of such breach will not deprive such party of the right to take action at any
time while such breach continues.

     

    11.         Amendment. This
Agreement may not be amended, modified or canceled other than by a written
instrument executed by both Parties, or by their duly authorized
representatives.

     

    12.         Survival of
Agreement. Except as otherwise expressly provided in this Agreement, the
rights and obligations of the parties to this Agreement shall survive the
termination of the Executive’s employment with the Company.

     

    13.         Entire Agreement.
This Agreement constitutes the entire agreement between the parties concerning
the subject matter hereof and supersedes all prior and contemporaneous
agreements including the Prior Agreement, if any, between the Executive and the
Company or its Affiliates relating to the subject matter hereof (except for the
Quark Agreement).

     

    14.         Governing Law. This
Agreement shall be governed by and construed and enforced in accordance with the
internal laws of the State of Israel without regard to principals of conflict of
laws. Any proceeding related to or arising out of this Agreement shall be
commenced, prosecuted or continued in Israel.

     

    15.         Acknowledgement by
Executive. The Executive represents to the Company that she is
knowledgeable and sophisticated as to business matters, including the subject
matter of this Agreement, that she has read this Agreement and that she
understands its terms. The Executive acknowledges that, prior to assenting to
the terms of this Agreement; she has been given a reasonable time to review it,
to consult with counsel of her choice, and to negotiate at arm’s- length with
the Company as to the contents. The Executive and the Company agree that the
language used in this Agreement is the language chosen by the parties to express
their mutual intent, and that no rule of strict construction is to be applied
against any party hereto.

     

    IN
WITNESS WHEREOF, the Executive has hereunto set her hand and the Company has
caused these presents to be executed in its name and on its behalf, as of the
date above first written.

     

    
      
        	
                EXECUTIVE

              	 	
                Q.B.I.
      ENTERPRISES LTD.

              
	 
      	 	 
      
	
                /s/ Elena Feinstein

              	 	
                By 

              	
                 /s/ D. Zurr

              
	
                Dr.
      Elena Feinstein

              	 	 
      

      

    

     

    
      
         

      

      
        7.

        
          

        

      

      
         

      

    

     

    
      Amendment
No. 1

       

      To
the

       

      Employment
Agreement

       

      This
Amendment No. 001 (the “Amendment”) to the Employment Agreement dated June 28,
2007 (the “Agreement”), is entered into as of November 26, 2007, between Dr. Elena Feinstein,
(“Executive”), and QBI
Enterprises, Ltd. at Weizmann Science Park, P.O. box 4071, Nes Ziona
70400, ISRAEL (hereinafter individually and collectively “QBI” or the
“Company”).  Collectively, QBI and Executive are referred to as
“Parties”.

       

      WHEREAS,
the Parties entered into the Agreement on June 28, 2007; and

       

      WHEREAS,
the Parties and Quark Pharmaceuticals Inc. (“Quark”) signed on a letter of
termination of the Employment Agreement dated June 28, 2007 between Quark and
Executive (the “Quark Agreement”) (the “Termination Letter”); and

       

      WHEREAS,
The Parties wish to amend the terms of the Agreement pursuant to the Termination
Letter.

       

      NOW,
THEREFORE, the parties agree as follows:

       

      Section
2 (a)- Base Salary- shall be deleted and replaced with the
following:

       

      (a)           The
Executive shall receive base salary at an annual rate of $200,000 U.S. Dollars
payable in equal installments on the regular employment payroll dates of the
Company, calculated in accordance with the representative rate of exchange of
the NIS against the Dollar published by the Bank of Israel as in effect on the
last day of the month in respect of which the salary is paid, inclusive of
travel expenses to which the Executive is entitled in accordance with applicable
laws.  Said salary and travel expenses shall be paid in arrears by the
9th day of each month in respect to a preceding month in which the Executive was
in employment (the “Salary”).  The Salary will be adjusted from time
to time in accordance with the cost of living increments (Tossefet Yoker) which
apply to all Employees in Israel.

       

      Section
2 (g)- Vacation- shall be deleted and replaced with the following:

       

      (g)           Vacation.  Each
calendar year during the Employment Period, the Executive shall be entitled to
22 working days of vacation (or a pro rata number of days for any partial year
that occurs during the Employment Period) determined in accordance with
applicable employment laws of Israel and Company policies on dates to be
coordinated with the Company in advance.  According to the company
policy, executive shall he able to accumulate up to 44 vacation days per
year.  The Executive has accumulated up until November 29, 2007 37.06
days ).  In addition, the Executive has accumulated up until November
2003:  81.76 vacation days (“additional vacation
days”).  Upon mutual agreement between the Executive and the company,
the “additional vacation days” will be reduced to 40.85 vacation
days.  The “additional vacation days” can be also used by Executive on
dates to be coordinated with the Company in advance and will not be brought into
account when calculating the 44 days per year that the Executive is entitled to
accumulate according to Company policy.  The Executive shall not be
entitled to receive from the Company any Sabbatical Year Leave.

       

      
        
           

        

        
          1.

          
            

          

        

        
           

        

         

      

      Section
2 (k)- U.S. Health Insurance- shall be added to the contract:

       

      Section
2 (k)- U.S. Health
Insurance.  The Company shall reimburse the Executive for the
Executive’s U.S. Health insurance Plan up to the yearly amount of $10,000 U.S.
Dollars.  Any amount exceeding $10,000 U.S. Dollars shall he paid by
the Executive.

       

      Except as
set forth in this Amendment the Agreement shall remain unchanged and in full
force and effect pursuant to its terms and is hereby ratified and confirmed by
the parties hereto.

       

      In the
Event that a conflict arises between the language of the Amendment and the
Agreement, the language of this Amendment shall take precedence over the
language of the Agreement.

       

      IN
WITNESS WHEREOF, the parties have caused this Amendment to the Agreement to be
executed by their duly-authorized representatives as of the Effective Date set
forth above.

       

      
        
          	      
                  QBI
      Enterprises, Ltd.

                	 	      
                  Dr.
      Elena Feinstein

                	 
	 	 	 	 	 
	Signature: 	
                  /s/
      D. Zurr

                	 	Signature: 	
                  /s/
      Elena Feinstein

                	 
	 	 	 	 
	      
                  Danny
      Zurr CEO

                	 	      
                  29
      Nov. 2007

                	 
	 	
                   

                	 	 	
                   

                	 

        

      

       

      
        
           

        

        
          2.

          
            

          

        

        
           

        

      

      

       

      October __________,
2007

       

      Dear Dr.
Elena Feinstein:

       

      Reference
is hereby made to that certain Employment Agreement, dated June 28, 2007 between
Quark Pharmaceuticals Inc. (the “Company”) and Dr. Elena Feinstein (the “ Quark
Agreement’’) and the Employment Agreement between Q.B.I Enterprises Ltd.
(“Q.B.I”) and Dr. Elena Feinstein, dated June 28, 2007 (the “Q.B.I
Agreement”).

       

      Notice is
hereby given pursuant to Section 3 (g) to the Q.B.I Agreement, that the Quark
Agreement is terminated and the Q.B.I Agreement shall continue in full force and
effect.  Amendment No. 1 to the Q.B.I Agreement dated November 29, 2007 between
Q.B.I and Dr. Elena Feinstein modifies the terms and conditions of Dr. Elena
Feinstein employment, as Q.B.I desires to employ the Executive on a full time
basis.

       

      The Non-
Compete and Proprietary Information Agreement dated May 1, 2007 between Company,
Q.B.I and Dr. Elena Feinstein shall remain in full force and effect pursuant to
its terms.

       

       

      Quark
Pharmaceuticals Inc.

       

      By: /s/ D.
Zurr                                   

       

      Name:

       

       

      Q.B.I
Enterprises Ltd

       

      By: /s/ D.
Zurr                                   

       

      Name:

       

       

      Accepted
and agreed to:

       

      /s/ Elena
Feinstein                           

       

      By:  Dr.
Elena Feinstein

       

       

      Quark
Pharmaceuticals, Inc., U.S.A., 6501 Dumbarton Circle, Fremont, CA 94555, Tel:
510-402-4020, Fax: 510-402-4021

      email: quark@quarkpharma.com

      QBI
Enterprises Ltd., Israel, Weizmann Science Park, P.O. Box 4071, Nes Ziona 70400
Israel, Tel: 972.(0)8.930.5111, Fax: 972(0)8.940.6476

      email: qbi@quarkpharma.com

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

      Document
translated from Hebrew

       

      Appendix
A

       

      (Section
14 of the Severance Pay Law, 5723-1963)

       

      
        	
                Between:

              	
                Q. B.I. Enterprises Ltd.
      (hereinafter: the “Employer”)

              

      

       

      
        	
                And:

              	
                Dr. Lena Feinstein
      (hereinafter: the
      “Employee”)

              

      

       

      
        	
                Whereas

              	
                The
      Employer and the Employee have agreed to adopt the conditions of the
      General Approval regarding Employer Payments into Pension Funds and
      Insurance Funds in lieu of Severance Pay, published in Yalkut Pirsumim 4659 of
      June 30, 1998 (and amended in Yalkut Pirsumim 4803 of
      August 23, 1999 and in Yalkut Pirsumim 4970 of
      March 12, 2001), the full wording of which is attached to this Agreement
      and constitutes an integral part hereof (hereinafter: the “General Approval”);
  and

              

      

       

      
        	
                Whereas

              	
                Pursuant
      to the conditions of the General Approval, the Employer's payments into a
      pension fund and/or insurance fund in the amounts and on the conditions
      set out in the General Approval shall be in lieu of the severance pay
      owing to the Employee for the salary from out of which the aforesaid
      payments are made, and for the period so paid, all as set out in the
      conditions of the General Approval.

              

      

       

      
        Therefore,
the Parties declare, stipulate and agree as follows:

      

       

      
        	
                1.

              	
                Preamble;
      Interpretation

              

      

       

      
        	
                 
      

              	
                1.1

              	
                The
      preamble to this Agreement and the General Approval constitute an integral
      part of this Agreement.

              

      

       

      
        	
                 
      

              	
                1.2

              	
                All
      of the terms in this Agreement shall be interpreted as defined in the
      General Approval, unless otherwise defined in the
    Agreement.

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                2.

              	
                Employer's
      Undertaking

              

      

       

      
        	
                 
      

              	
                2.1

              	
                The
      Employer shall transfer payments for the Employee into pension funds
      and/or insurance funds and/or provident funds for severance pay, as set
      out below [where necessary, delete whichever is
    inapplicable]:

              

      

       

      
        
          	
                	
                  2.1.1

                	
                  Insurance
      fund of Migdal
      Insurance
      Company Ltd.

                

        

      

       

      
        
          	
                	
                  2.1.2

                	
                  Pension
      fund Makefet
      and
      supplement for provident fund for severance pay Dash
      Provident 

                

        

      

       

      
        	
                 
      

              	
                2.2

              	
                In
      the event of amendment of the Employee's salary and/or marital status, the
      Employer's provisions for such payments shall be adjusted without
      requiring the execution of a separate
agreement.

              

      

       

      
        	
                 
      

              	
                2.3

              	
                The
      Employer hereby waives, in advance, any right that it may have to refund
      of any monies from its payments unless the Employee withdraws monies from
      the pension fund or insurance fund other than due to an entitling event as
      defined in the General Approval, or if his employment with the Employer is
      terminated under circumstances in which a competent judicial instance has
      denied his entitlement to severance pay under the provisions of the
      Severance Pay Law, 5723-1963.

              

      

       

      
        	
                3.

              	
                Employee’s
      Declarations

              

      

       

      
        	
                 
      

              	
                The
      Employee hereby declares and confirms that it is aware and agrees that
      subject to the performance of the Employer's obligations under the
      Agreement and the conditions of the General Approval, the Employer's
      payments as set out in section 2 above shall be in lieu of the severance
      pay owed to the Employee for the salary from which the aforesaid payments
      were made, and for the period in which they were
  made.

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                4.

              	
                General
      Approval

              

      

       

      The
following is the wording of the General Approval as published in Yalkut Pirsumim 4659 of June
30, 1978 (following amendment in Yalkut Pirsumim 4803 of
August 23, 1999 and in Yalkut
Pirsumim 4970 of March 12, 2001).

       

      By virtue
of my authority pursuant to section 14 of the Severance Pay Law, 5723-1963,
(hereinafter: the “Law”), I certify that payments
made by the Employer as of the date of publication of this Certificate, for the
Employee, into a comprehensive pension in an annuity fund which is not an
insurance fund as defined in the Income Tax (Rules for Approval of and
Management of Pension Funds) Regulations, 5724-1964 (hereinafter: a “Pension Fund”), or into an
executive insurance policy which includes the ability to pay an annuity or a
combination of payments into an annuity plan and a plan which is not an annuity
plan, into such insurance fund (hereinafter: an “Insurance Fund”), including
payments made by combining payments into a Pension Fund and an Insurance Fund,
whether the Insurance Fund contains an annuity plan or not (hereinafter: “Employer Payments”) shall
stand in lieu of the severance pay owing on the Salary out of which the
aforesaid payments are made, and for the period paid (hereinafter: the “Severance Salary”), provided
that all of the above exist:

       

      
        	
                (1) 

              	
                Employer's Payments
    –

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Into
      a Pension Fund shall be no less than 14.33% of the Severance Salary or 12%
      of the Severance Salary if the Employer also makes payments for the
      Employee, in addition to the above, for supplementation of severance
      pay into a severance pay pension fund or an Insurance Fund in the
      Employee’s name in the rate of 2.33% of the Severance
      Salary.  Where the Employer has not paid the aforesaid 2.33% in
      addition to the 12%, the Employer’s payments shall stand in lieu of 72% of
      the Employee’s severance pay only.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                Into
      an Insurance Fund are no less than one of the
  following:

              

      

       

      
        	
                 
      

              	
                (1)

              	
                13.33%
      of the Severance Salary, if the Employer pays for the Employee, in
      addition to the above, for monthly salary assurance in the event of loss
      of capacity to work, under a plan approved by the Commissioner for Capital
      Markets, Insurance and Savings at the Ministry of Finance, in the rate
      required to assure 75% of the Severance Salary at least, or in the rate of
      2.33% of the Severance Salary, whichever is the lesser (hereinafter:
      “Payment for Insurance of
      Loss of Capacity to Work”);

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                (2)

              	
                11%
      of the Severance Salary if the Employer also makes Payment for
      Insurance of Loss of Capacity to Work, in which case the Employer’s
      payments shall stand in lieu of 72% of the Employee’s severance pay only.
      Where the Employer, in addition to the above, makes payments in
      supplementation of severance pay into a severance pay pension fund or an
      insurance fund in the Employee’s name, in the rate of 2.33% of the
      Severance Salary, the Employer’s payments shall stand in lieu of 100% of
      the Employee’s severance pay.

              

      

       

      
        	
                (2)

              	
                No
      more than three months after the commencement of the Employer’s payments,
      a written agreement is entered into between the Employer and the Employee
      containing –

              

      

       

      
        	
                 
      

              	
                (a)

              	
                The
      Employee's consent to an arrangement under this Approval in a form setting
      out the Employer's payments to the Pension Fund or Insurance Fund, as the
      case may be, such agreement to also contain the wording of this
      Approval;

              

      

       

      
        	
                 
      

              	
                (b)

              	
                The
      employer's waiver, in advance, of any right that it might have to refund
      of monies from its payments, unless the employee's right to severance pay
      is denied in a judgment under section 16 or 17 of the Law and in the event
      that it is so denied or that the Employee has withdrawn monies from the
      pension fund or insurance fund other than with respect to an entitling
      event: For this purpose, “entitling event” – death, disability or
      retirement at age sixty or above.

              

      

       

      
        	
                (3)

              	
                This
      Approval shall not derogate from an employee’s right to severance pay
      under the Law, under a collective agreement, extension order or employment
      contract, in respect of salary above the exempt
  salary.

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                5.

              	
                Term of
      Agreement

              

      

       

      The
Agreement shall apply to the Employer's payments commencing on 6/28/2007 and
shall remain in force for so long as the Employer is making payments in
accordance with section (1) of the conditions of the General
Approval.

       

      In
witness whereof, we have hereunto set our hands
this         22nd day of November,
2007

       

      
        	
                Employer

              	
                EmployeeUnassociated Document

    Exhibit
10.10

     

    EMPLOYMENT
AGREEMENT

     

    This
Agreement, is made on 1 August, 2010 (Effective date 1 August 2010), by
and between, Q.B.I. Enterprises Ltd. (the “Company”)
and Sagit Reich (the “Executive”);

     

    
      	
              Whereas:

            	
              The
      Company desires to employ the Employee as the Chief Financial Officer
      (CEO) of the Company and the Employee desires to enter into such
      employment, on the terms and conditions hereinafter set
    forth.

            

    

     

    Now,
Therefore in consideration of the respective agreements of the parties
contained premises and of the mutual covenants herein contained, the parties
hereby agree us follows:

     

    1.           Performance of
Services.  Executive’s employment with the Company shall be
subject to the following:

     

    (a)           Subject
to the terms of this Agreement, the Company hereby agrees to employ the
Executive in the position of Chief Financial Officer (CFO) of the Company and of
its parent company Quark Pharmaceutical Inc. (“Quark”)
and the Executive hereby agrees to remain in the employ of the Company in such
position.

     

    (b)           While
the Executive is employed by the Company, the Executive shall devote his full
time and best efforts, energies and talents to serving the Company and shall not
be engaged in any other employment nor engage in any other business activities
for any other person, firm or company without the prior written consent of the
Company.

     

    (c)           The
Executive shall report to the Chief Executive Officer of the Company and of
Quark (the “CEO”)
and shall perform the duties, undertake the responsibilities and exercise the
authority customary for an employee in the Executive’s position and shall
perform such additional duties as may be assigned to him by the
CEO.

     

    (d)           The
Executive agrees that he shall perform his duties faithfully and efficiently
subject to the direction of the CEO.  The Executive’s duties shall
include providing services for both the Company and its Affiliates (as defined
below) as determined by the Company.  For purposes of this Agreement,
the term “Affiliate”
shall mean Quark and any corporation, partnership, joint venture or other entity
in which at least a fifty percent interest in such entity is owned, directly or
indirectly, by Quark or the Company.

     

    (e)           The Executive’s
place of employment shall be in Israel, provided that the Company may require
the Executive to travel outside Israel in order to fulfill his duties with the
Company and Quark.

     

    (f)           The
Executive’s position is a “senior managerial position”, as defined in the
Israeli Work and Rest Hours Law, 1951, and requires a high level of
trust.  Accordingly, the provisions of said law shall not apply to the
Executive and the Executive agrees that he may be required to work beyond the
regular working hours of the Company, for no additional compensation other than
as specified in this Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (g)           The
employment of the Executive under this Agreement shall commence on the Effective
Date and shall continue until terminated in accordance with the provisions of
Section 3 below (the “Employment
Period”).

     

    2.           Compensation and
Benefits.  Subject to the terms of this Agreement, during the
Employment Period, the Company shall compensate the Executive for his services
as follows:

     

    (a)           Base Salary.  The
Executive shall receive base salary at a monthly rate of 50,000 New Israeli Shekel
(“NIS”),
exclusive of travel expenses to which the Executive is entitled in accordance
with applicable laws.  Said salary and travel expenses shall he paid
in arrears by the 9th day of
each month in respect to a preceding month in which the Executive was in
employment (the “Salary”).  The
Salary will be adjusted from time to time in accordance with the cost of living
increments [Tossefet
Yoker] which apply to all Employees in Israel.

     

    (b)           Stock Awards.  An
award in the form of a stock options (“Stock
Options”) is granted to the Executive, it will be made in accordance with
the terms and principles detailed in Quark’s Stock Option Plan for Israeli
Employees.  The Stock Options will he granted under Quark’s standard
stock option agreement for Company employees to he entered into between the
Executive and Quark.  The Executive’s Stock Options are listed in
Exhibit A.

     

    (c)           Bonus.  Subject
to a successful IPO, at the discretion of the CEO, the executive shall be
eligible to earn a bonus.  Any bonus earned will be paid no later than
60 days after the IPO and provided the executive’s employment at the company is
still in effect.  In addition the Executive
will be entitled to an annual bonus according the Company’s policy and the
discretion of the CEO.

     

    (d)           Managers’
Insurance.  During the Employment Period, the Company shall
allocate a Managers’ Insurance (Bituach Menahalim) policy and
shall contribute thereto, on a monthly basis, 18.33% of the Executive’s monthly
Salary, 8.33% of which shall be in respect of severance compensation (the “Severance
Component”), 5% of which shall be in respect of pension, and 5% of which
shall he deducted by the Company from the monthly payment of the Executive’s Salary as the
Executive’s contribution to said Managers’ Insurance.  Payments by the
Company towards the Policy under this Section 2(d) shall be in lieu of any
statutory obligations to pay severance pay, subject to the approval of the
Minister of Labor under Section 14 of the Severance Pay Law
5723-1963.

     

    (e)           Disability.  During the
Employment Period, the Company shall take out Disability Insurance (Ovdan Kosher Avoda) as in
effect immediately prior to the Effective Date and contribute thereto, on a
monthly basis, up to 2.5% of the Executive’s monthly Salary.

     

    (f)           Education
Fund.  During the
Employment Period, the Company shall contribute to an Education Fund (Keren Hishtalmul), on a
monthly basis, 7.5% of the Executive’s monthly Salary, subject to the
Executive’s contribution of an additional 2.5% of his monthly
Salary.  All tax obligations related to the Education Fund shall be
borne by the Executive.

    
      
         

      

      
        2.

        
          

        

      

      
         

      

    

     

    (g)           Recreation
Funds.  During the
Employment Period, the Company shall provide and pay the Executive Recreation
Funds (Dmei Havra’ah)
at the rate required by applicable law and regulations.

     

    (h)           Vacation.  During each
calendar year during the Employment Period, the Executive shall be entitled to
22 working days of vacation (or a pro rata number of days for any partial year
that occurs during the Employment Period) determined in accordance with
applicable employment laws of Israel and Company policies on dates to be
coordinated with by the Company in advance.  The Executive shall not
be entitled to receive from the Company any Sabbatical Year Leave.

     

    (i)           Sick
Leave.  The Executive
shall be entitled to 18 sick days a year, payment according to gross
salary.  Executive will be entitled to accumulate these sick
days.  Sick days can’t be redeemed.  Payment for Sick days,
as stated above, covers all payments that the Company is obligated towards the
Executive pursuant to the Sick Pay Law — 1976.

     

    (j)           Use of Company
Car.  During his employment with the Company hereunder, the
Executive shall have the use of a Company car (rank 2) free of
charge.  Any income tax which may be assessed on such use of the car
shall be for the account of the Company.  The Executive will be
responsible for the payment of fines (if any) imposed with respect to the use of
the car by her.

     

    (k)          Expenses.  The Company
will pay or reimburse Executive for reasonable travel or other expenses incurred
by Executive in the furtherance of or in connection with the performance of
Executive’s duties hereunder in accordance with the Company’s established
policies (including reimbursement for telephone expenses).  Executive
shall furnish the Company with evidence of the incurrence of such expenses
within a reasonable period of time from the date that they were
incurred.

     

    (l)           Use of
Company Cell Phone.  During his
employment with the Company hereunder, the Executive shall have the use
of a Company cell phone free of charge according to the Company
policy.  Any income tax which may be assessed on such use of the cell
phone shall be for the account of the Executive.

     

    (m)         Taxes.  All sums
mentioned in this Agreement are pre-tax.  The Executive shall bear and
pay any and all taxes imposed on his Salary, the Stock Options and any all
benefits hereunder.

     

    3.           Termination.  The
Executive’s employment with the Company during the Employment Period may be
terminated under the following circumstances:

     

    (a)           Death.  The
Executive’s employment hereunder shall terminate upon his
death.

    
      
         

      

      
        3.

        
          

        

      

      
         

      

    

    (b)           Disability.  If the
Executive becomes Disabled, the Company may terminate his employment with the
Company.  For purposes of this Agreement, the Executive shall be
deemed to be “Disabled”
if he has a physical or mental disability which renders him incapable of
performing substantially all of his duties hereunder for a period of 90 days
(which need not be consecutive) in any 12-month period.  In the event
of a dispute as to whether the Executive is Disabled, the Company may, at its
expense, refer him to a licensed practicing physician of the Company’s choice
and the Executive agrees to submit to such tests and examination as such
physician shall deem appropriate.  The determination of such physician
shall be final and binding on the Company and Executive.

     

    (c)           Cause.  The Company
may terminate the Executive’s employment hereunder immediately and at any time
for Cause by written notice to the Executive detailing the basis for the Cause
termination.  For purposes of this Agreement, “Cause” means (i) the
commission by the Executive of an act of dishonesty or a Breach of faith or
trust by the Executive as an employee of the Company (ii) conviction of any
felony involving moral turpitude or affecting the Company

     

    (d)           Termination by
Executive.  The Executive may terminate his employment
hereunder at any time for any reason by giving the Company prior written notice
not less than 90 days prior to such termination.

     

    (e)           Mutual
Agreement.  This Agreement may be terminated at any time by
mutual written agreement of the parties.

     

    (f)           Termination by the Company without
Cause.  The Company may terminate the Executive’s employment
hereunder at any time for any reason by giving the Executive prior written
notice not less than 90 days prior to such termination.  During the
Notice Period, the Executive will continue in the employ of the Company pursuant
to the terms of this agreement and to receive the Salary
and other benefits hereunder.

     

    (g)           Date of
Termination.  “Date of
Termination” means the last day that the Executive is employed by the
Company under the terms of this Agreement under circumstances in which his
employment is terminated in accordance with one of the foregoing provisions of
this paragraph 3.

     

    4.           Rights
Upon Termination.

     

    (a)          In
the event of Termination lo any reason, the Company shall:

     

    (i)          
  Pay the Executive’s Salary for the period ending on the Date of
Termination.

     

    (ii)           Transfer
to the Executive, within 30 days following Date of Termination, any and all
allocations accrued under his Managers’ Insurance and Educational
Fund.

     

    (b)          Notwithstanding
any provision of this Section 4 to the contrary, the Company shall have no
obligation to transfer or release the Severance Component of the Managers’
Insurance in circumstances where Israeli laws denies the Executive’s right to
severance payment by pursuant to Sections 17 to the Israeli Severance Payment
Law 5723 – 1963.

    
      
         

      

      
        4.

        
          

        

      

      
         

      

    

     

    5.           Confidentiality and
Non-competition.  In consideration for the payments and
benefits contemplated by Section 2, the Executive acknowledges and agrees that
simultaneous with the execution of this Agreement, he will be required to
execute and comply with the Non-competition and Proprietary Information
Agreement in the form attached to this Agreement as Exhibit B.

     

    6.           Representations
and Warranties.

     

    (a)           The
Executive represents and warrants that: (i) the execution and delivery of this
Agreement and the fulfillment of the terms hereof will not constitute a default
under or breach of any agreement or other instrument to which he is a party or
by which he is bound, including without limitation, any confidentiality or non
competition agreement, and do not require the consent of any person or entity;
(ii) he shall not utilize, during his employment with the Company any
proprietary information of any of his previous employers.

     

    (b)           The
Executive shall inform the Company, immediately upon becoming aware of every
matter in which he or a member of his immediate family or affiliate has a
personal interest or which might create a conflict of interests with his duties
to the Company.

     

    7.           Successors.  This
Agreement shall be binding upon, and inure to the benefit of, the Company and
its successors and assigns and upon any person acquiring, whether by merger,
consolidation, purchase of assets or otherwise, all or substantially all of the
Company’s assets and business.

     

    8.           Notices.  Notices
and all other communications provided for in this Agreement shall be in writing
and shall be delivered personally or sent by registered or certified mail,
return receipt requested, postage prepaid, or sent by facsimile or prepaid
overnight courier to the parties at the addresses set forth below (or such other
addresses as shall be specified by the parties by like notice):

     

    To the
Company:

     

    Q.B.I.
Enterprises Ltd.

    PO Box
741,

    Nes Ziona
74106

    Israel

    Attn:  Dr.
Daniel Zurr

     

    To the
Executive:

     

    Sagit
Reich, at the most recent address shown in the records of the
Company.

     

    Notices
hereunder shall be deemed to be effective (a) upon receipt if delivered
personally, (b) on the tenth (10th) day following the
date of mailing if sent by registered or certified air mail; (c) on the second
(2nd) day
following the date of transmission or delivery to the overnight courier if sent
by overnight courier; and (d) on the next day after the date sent by facsimile
(with receipt confirmation).  A party may change its address listed
above by sending notice to the other party in accordance with this Section
8.

    
      
         

      

      
        5.

        
          

        

      

      
         

      

    

     

    9.           Severability.  The
invalidity or unenforceability of any provision of this Agreement will not
affect the validity or enforceability of any other provision of this Agreement,
and this Agreement will be construed as if
such invalid or unenforceable provision were omitted (but only to the extent
that such provision cannot be appropriately reformed or modified).

     

    10.         Waiver of
Breach.  No waiver of any party hereto of a breach of any
provision of this Agreement by any other party will operate or be construed as a
waiver of any subsequent breach by such other party.  The failure of
any party hereto to take any action by reason of such breach will not deprive
such party of the right to take action at any time while such breach
continues.

     

    11.         Amendment.  This
Agreement may not be amended, modified or canceled other than by a written
instrument executed by both Parties, or by their duly authorized
representatives.

     

    12.         Survival of
Agreement.  Except as otherwise expressly provided in this
Agreement, the rights and obligations of the parties to this Agreement shall
survive the termination of the Executive’s employment with the
Company.

     

    13.         Entire
Agreement.  This Agreement constitutes the entire agreement
between the parties concerning the subject matter hereof and supersedes all
prior and contemporaneous agreements, if any, between the Executive and the
Company or its Affiliates relating to the subject matter
hereof.  Excluding the Stock Option Agreement between the Executive
and the Company.

     

    14.         Governing Law.  This
Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of
Israel without regard to principals of conflict of laws.  Any
proceeding related to or arising out of this Agreement shall be commenced,
prosecuted or continued in Israel.

     

    15.         Acknowledgement by
Executive.  The Executive represents to the Company that he is
knowledgeable and sophisticated as to business matters, including the subject
matter of this Agreement, that he has read this Agreement and that he
understands its terms.  The Executive acknowledges that, prior to
assenting to the terms of this Agreement; he has been given a reasonable time to
review it, to consult with counsel of his choice, and to negotiate at
arm’s-length with the Company as to the contents.  The Executive and
the Company agree that the language used in this Agreement is the language
chosen by the parties to express their mutual intent, and that no rule of strict
construction is to be applied against any party hereto.

    
      
         

      

      
        6.

        
          

        

      

      
         

      

    

     

    In Witness
Whereof, the Executive has hereunto set his hand and the Company has
caused these presents to be executed in its name and on its behalf, as of the
date above first written.

     

    
      
        
          	
                  Executive

                	 
      	
                  Q.B.I.
      Enterprises Ltd.

                
	 
      	 
      	 
      
	
                    /s/ Sagit Reich

                	
                    

                	
                    /s/ D.
  Zurr

                

        

      

    

     

    
      
         

      

      
        7.

        
          

        

      

      
         

      

    

     

    

       
 

      Exhibit
A

       

      ESOP
PARTICIPATION

       

      1.           The
Executive shall be entitled to an option award in accordance with the Company’s
2007 ESOP plan (the “Plan”) and
subject to the terms and conditions of such plan as adopted by the Company, or
as amended from time to time.

       

      2.           The
number of Quark shares of common stock to be awarded to the Executive is 120,000 shares of common stock
of Quark (the “Stock
Options”).

       

      3.           The
Stock Option award shall be Approved 102 Awards as defined in the Plan and shall
accordingly be issued to a Trustee to be held in accordance with the
requirements applicable to Approved 102 Awards.

       

      4.           The
exercise price per share of Quark common stock that shall derive from the
exercise of the Stock Options shall be the market price of the common stock at
the grant date.

       

      5.           The
Stock Options shall be subject to a four (4) year vesting period commencing
1 August, 2010 all in
accordance with the provisions of the Plan (25% of the Stock Options shall vest
after 12 months and 1/48th of the
Stock Options shall vest each month thereafter, subject to Executive’s continued
employment).

       

      6.           The
Executive shall be entitled to acceleration of the option vesting period as
follows:

       

      a.           In
the event of the consummation of the initial public offering Qualified IPO
(As defined below)
(“IPO”) of
Quark prior to the vesting of forty percent (40%) of the total number of shares
that shall derive on the exercise of the Stock Options, the vesting provisions
shall be accelerated so that upon the consummation of the IPO forty percent
(40%) of the total number of shares that derive from the exercise of the Stock
Options shall be vested.  The balance of the shares that derive from
the exercise of the Stock Options shall then vest on a monthly basis until the
end of the vesting period (1/48th of the
Stock Options shall vest each month thereafter subject to Executive’s continued
employment).

       

      b.           In
the event that (i) Quark is merged with any other entity in which the
shareholders of Quark receive distributions in cash, property or securities of
another entity as a result of such merger, and in which the shareholders of
Quark immediately prior to such merger will not hold at least fifty percent
(50%) of the voting power of the surviving, continuing or purchasing entity
following such merger, or (ii) all or substantially all of the issued share
capital of Quark is acquired by a third party, (collectively: an “M&A
Transaction”) then all shares that derive from the exercise of the Stock
Options shall vest on the consummation of the M&A Transaction.

       

      For the
purposes hereof IPO mean:  Qualified IPO - As defined in
the company article of incorporation as amended from time to
time.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       
 

      Exhibit
B

       

      CALIFORNIA
LABOR CODE SECTION 2870

      INVENTION
ON OWN TIME - EXEMPTION FROM AGREEMENT

       

      (a)          Any
provision in an employment agreement which provides that an employee shall
assign, or offer to assign, any of his or her rights in an invention to his or
her employer shall not apply to an invention that the employee developed
entirely on his or her own time without using the employer’s equipment,
supplies, facilities, or trade secret information except for those inventions
that either:

       

      (1)           Relate
at the time of conception or reduction to practice of the invention to the
employer’s business, or actual or demonstrably anticipated research or
development of the employer; or

       

      (2)           Result
from any work performed by the employee for the employer.

       

      (b)          To
the extent a provision in an employment agreement purports to require an
employee to assign an invention otherwise excluded from being required to be
assigned under subdivision (a), the provision is against the public policy of
this state and is unenforceable.”

    

    
       

      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

      

         
 

        QBI
ENTERPRISES, LTD.

         

        QUARK
PHARMACEUTICAL, INC.

         

        NON-COMPETITION
AND PROPRIETARY

        INFORMATION
AGREEMENT

         

        This Non-Competition And Proprietary
Information Agreement, is made as of the  1st day of August
2010, by and between QBI Enterprises, Ltd., a corporation organized under the
laws of Israel (“QBI”) and
its parent company Quark Pharmaceutical Inc., a California corporation (“Quark
Pharmaceutical”), (together, the “Company”),
and Sagit Reich, an employee of QBI (the “Employee”).

         

        As an
employee of QBI and in consideration of the compensation now and hereafter paid
to me by QBI, I agree to the following:

         

        1.           Confidential
Information.

         

        (a)           Company
Information.  I agree at all times during the term of my
employment and thereafter, to hold in strictest confidence, and not to use,
except for the benefit of the Company, or to disclose to any person, firm or
corporation without written authorization of the Board of Directors of Quark
Pharmaceutical (the “Board”),
any trade secrets, confidential knowledge, data or other proprietary information
(collectively referred to as the “Confidential
Information”) relating to products, processes, know-how, designs,
formulas, development of experimental work, computer programs, data bases, other
original works of authorship, customer lists, business plans, financial
information or other subject matter pertaining to the business of the
Company.  I understand that Confidential Information does not include
any of the foregoing items which have become publicly known and made generally
available through no wrongful act of mine or of others who were under
confidentiality obligations as to the item or items involved.

         

        (b)           Third Party
Information.  I recognize that the Company has received and in
the future will receive from third parties their confidential or proprietary
information subject to a duty on the Company’s part to maintain the
confidentiality of such information and to use it only for certain limited
purposes.  I agree that I owe the Company and such third parties,
during the term of my employment and thereafter, a duty to hold all such
confidential or proprietary information in the strictest confidence and not to
disclose it to any person, firm or corporation (except as necessary in carrying
out my work for the Company consistent with the Company’s agreement with such
third party) or use it for the benefit of anyone other than for the Company or
such third party (consistent with the Company’s agreement with such third party)
without the express written authorization or the Board.

        
          
             

          

          
             

            
              

            

          

          
             

          

        

        2.           Retaining
and Assigning Inventions and Original Works.

         

        (a)           Inventions and Original Works
Assigned to the Company.  I agree that I will promptly make
full written disclosure to the Company, will hold in trust for the sole right
and benefit of the Company, and hereby assign to the Company, or its designee,
all my right, title, and interest in and to any and all inventions, discoveries,
improvements, technology, trade-secrets, computer programs, know-how, designs,
formulas, original works of authorship, or any other confidential materials,
data, information, or instructions, technical or otherwise and whether or not
patentable or registrable under copyright or similar laws and whether or not
reduced to practice (collectively referred to as “Inventions”),
which I may solely or jointly conceive or develop or reduce to practice, or
cause to be conceived or developed or reduced to practice, during the period of
time I am in the employ of the Company.  I recognize, however that to
the extent I am employed in California, Section 2870 of the California Labor
Code exempts from this provision and Inventions that I develop entirely on my
own time, without using the Company’s equipment, supplies, facilities, or trade
secret information except for those Inventions that either relate at the time of
conception or reduction to practice of the Invention to the Company’s business,
or actual or demonstrably anticipated research or development of the Company’s
or results from any work performed by me for the Company.

         

        I
acknowledge that all original works of authorship which are made by me (solely
or jointly with others) within the scope of my employment with the Company and
which are protectable by copyright are “works made for hire,” as that term is
defined in the United States Copyright Act (17 USCA Section 101).

         

        (b)           Inventions Assigned to the United
States.  I agree to assign to the United States government or
other third party all my right, title, and interest in and to any and all
Inventions, original works of authorship, developments, improvements or trade
secrets whenever such full title is required to be in the United States or other
third party by a contract between the Company and the United States or any of
its agencies or such third parties.

         

        (c)           Maintenance of
Records.  I agree to make best efforts and maintain adequate
and current written records of all Inventions made by me (solely or jointly with
others) during the term of my employment with the Company.  The
records will be in the form of notes, sketches, drawings, and any other format
that may be specified by the Company.  The records will be available
to and remain the sole property of the Company at all times.

         

        (d)           Obtaining Letters Patent and
Copyright Registrations.  I agree that, whenever requested by
the Company, I shall assist the Company, or its designee, in obtaining United
States or foreign letters patent and copyright registrations as the case may be,
covering Inventions assigned hereunder lo the Company, and I shall execute any
patent or copyright applications or such other documents as the Company, or its
counsel, to apply for and obtain such letters patent or copyrights.

         

        I agree
that my obligation to execute or cause to be executed, when it is in my power to
do so, any such instrument or papers shall continue after the termination of
this Agreement, but the Company shall compensate me at a reasonable rate for
time actually spent by me at the Company’s request on such
assistance.

         

        If the
Company is unable because of my mental or physical incapacity or for any other
reason to secure my signature to apply for or to pursue any application for any
United States or foreign letters patents or copyright registrations, as the case
may be, covering Inventions assigned to the Company as above, then I hereby
irrevocably designate and appoint the Company and its duly authorized officers
and agents as my agent and attorney in fact, to act for and in my behalf and
stead to execute and file any such applications and to do all other lawfully
permitted acts to further the prosecution and issuance of letters patent or
copyright registrations thereon with the same legal force and effect as if
executed by me.

        
          
             

          

          
            2.

            
              

            

          

          
             

          

        

         

        I hereby
waive and quitclaim to the Company and all claims, of any nature whatsoever,
which I now or may hereafter have for infringement of any patents or copyright
resulting from any such application for letters patent or copyright
registrations assigned hereunder to the Company.

         

        (e)           Exception to
Assignments.  To the extent that I am employed in California, I
understand that the provisions of this Agreement requiring assignment of
Inventions to the Company do not apply to any invention which qualifies fully
under the provisions of California Labor Code Section 2870 (See Exhibit B).  I will
advise the Company promptly in writing of any inventions that I believe meet the
criteria in Subparagraph 2(b) above; and I will at the time provide to the
Company all evidence necessary to substantiate that belief I understand that
that the Company will keep in confidence and will not disclose to third parties
without my consent any confidential information disclosed in writing to the
Company relating to Inventions that qualify fully under the provisions of
Section 2870 of the California Labor Code.

         

        3.           Conflicting
Employment.  I agree that, during the term of my employment
with the Company, I will not engage in any other employment, occupation,
consulting or other business activity that is directly related to the business
in which the Company is now involved or becomes involved during the term of my
employment, nor will I engage in any other activities that conflict with my
obligations to the Company.  Notwithstanding the above the Company may
provide the employee with a prior written consent to the above
mentioned.

         

        4.           Restriction on Competing
Activities.  Beginning on the date I commence my employment
with the Company and ending twelve months after the end of my employment with
the Company (the “Non-Competition
Period”), I will not, directly or indirectly, alone or as a partner,
officer, director, owner, employee, or consultant of any business or other
entity, be engaged in any business or other enterprise that competes, directly
or indirectly, in any way with the Company’s products or products under
development currently or as may be in the future on the date my employment with
the Company terminates.

         

        5.           Returning Company
Documents.  I agree that, at the time of leaving the employ of
the Company, I will deliver to the Company (and will not keep in my possession,
recreate or deliver to anyone else) any and all devices, records, data, notes,
reports, proposals, lists, correspondence, specifications, drawings blueprints,
sketches, materials, equipment, other documents or property, or reproductions of
any aforementioned items developed by me pursuant to my employment with the
Company or otherwise belonging to the Company, its successors or assigns,
including, without limitation, those records maintained pursuant to paragraph
3(d).  In the event of the termination of my employment, I agree to
sign and deliver the “Termination
Certification” attached hereto as Exhibit C.

         

        6.           Notification of New
Employer.  In the event that I leave the Company, I hereby
grant consent to notification by the Company to my new employer about my rights
and obligations under this Agreement.

        
          
             

          

          
            3.

            
              

            

          

          
             

          

        

         

        7.           Non-Solicitation.  I
agree that for a period of twelve (12) months immediately following the
termination of my relationship with the Company for any reason, whether with or
without cause, I shall not either directly or indirectly solicit, induce,
recruit or encourage any of the Company’s employees to leave their employment,
or any customers, clients, or other entities to terminate their relationship
with the Company, or attempt to solicit, induce, recruit, encourage or take away
employees, customers, or clients of the Company, either for myself or for any
other person or entity.

         

        8.           Conflict of Interest
Guidelines.  I agree to diligently adhere to the Conflict of
Interest Guidelines attached as Exhibit D hereto.

         

        9.           Representations.  I
agree to execute any proper oath or verify any proper document required to carry
out the terms of this Agreement.  I have not entered into, and I agree
I will not enter into, any oral or written agreement in conflict
herewith.

         

        10.        General
Provisions.

         

        (a)           Governing Law; Consent to Personal
Jurisdiction.  This Agreement will be governed by the laws of
the State of Israel.  I hereby expressly consent to the personal and
exclusive jurisdiction of the appropriate courts in Israel (as applicable) for
any lawsuit filed by me against the Company or against me by the Company arising
from or relating to this Agreement.

         

        (b)           Entire
Agreement.  This Agreement sets forth the entire agreement and
understanding between the Company and me relating to the subject matter herein
and all prior representations, understandings, and agreements concerning the
subject matter of this Agreement have been merged into this
Agreement.  Any subsequent changes in my duties, salary, or
compensation will not effect the validity or scope of this
Agreement.

         

        (c)           Severability.  If
one or more of the provisions in this Agreement are deemed void by law, then the
remaining provisions will continue in full force and effect.

         

        (d)           Successors and
Assigns.  This Agreement will be binding upon my heirs,
executors, administrators and other legal representatives and will be for the
benefit of the Company, its successors, and its assigns.

         

        Date:
_______________________

         

        
          	 
      	
                  /s/ Sagit Reich

                
	 
      	
                  Signature

                
	 
      	 
      
	 
      	
                  Sagit Reich

                
	 
      	
                  Type
      Name

                

        

        

        Witness:
____________________

        
          
             

          

          
            4.

            
              

            

          

          
             

          

        

      

    

     

     

    Exhibit
C

     

    TERMINATION
CERTIFICATION

     

    This is
to certify that I do not have in my possession, nor have I failed to return, any
devices, records, data, notes, reports, proposals, lists, correspondence,
specifications, drawings, blueprints, sketches, materials, equipment, other
documents or property, or reproductions of any aforementioned items belonging to
Quark Pharmaceutical, Inc., Q.B.I. Enterprises Ltd. and their subsidiaries,
affiliates, successors or assigns (together, the “Company”).

     

    I further
certify that I have complied with all the terms of the Company’s Employment,
Confidential Information, Invention Assignment and Arbitration Agreement signed
by me, including the reporting of any inventions and original works of
authorship (as defined (herein), conceived or made by me (solely or jointly with
others) covered by that agreement.

     

    I further
agree that, in compliance with the Employment and Proprietary Information,
Agreement I will preserve as confidential all trade secrets, confidential
knowledge, data or other proprietary information relating to products,
processes, know-how, designs, formulas, developmental or experimental work,
computer programs, data bases, other original works of authorship, customer
lists, business plans, financial information or other subject matter pertaining
to any business of the Company or any of its employees, clients, consultants or
licensees.

     

    I further
agree that, in compliance with the Employment and Proprietary Information,
Agreement, for twelve (12) months from this date, (i) I will not, directly or
indirectly, be engaged in any business or other enterprise that competes,
directly or indirectly, in any way with the Company’s products (ii) hire any
employees of the Company and I will not solicit, induce, recruit or encourage
any of the Company’s employees to leave their employment.

     

    Date:
_______________________ 

     

    
      
        
          
            
              
                	 
      	
                        By: 

                      	
                        /s/ Sagit Reich

                      	 
      
	 	 	 	 
	 
      	 
      	
                        Sagit Reich

                      	 
      
	 
      	 
      	
                        TYPE
      NAME

                      	 
      

              

            

          

        

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     
 

    Exhibit
D

     

    CONFLICT
OF INTEREST GUIDELINES

     

    It is the
policy of Quark to conduct its affairs in strict compliance with the letter and
spirit of the law and to adhere to the highest principles of business
ethics.  Accordingly, all officers, employees and independent
contractors must avoid activities which are in conflict, or give the appearance
of being in conflict, with these principles and with the interests of the
Company.  The following are potentially compromising situations which
must be avoided.  Any exceptions must be reported to the President and
written approval for continuation must be obtained.

     

    1.           Revealing
confidential information to outsiders or misusing confidential
information.  Unauthorized divulging of information is a violation of
this policy whether or not for personal gain and whether or not harm to the
Company is intended.

     

    2.           Accepting
or offering substantial gifts, excessive entertainment, favors or payments which
may be deemed to constitute undue influence or otherwise be improper or
embarrassing to the Company.

     

    3.           Participating
in civic or professional organizations that might involve divulging confidential
information of the Company.

     

    4.           Initiating
or approving personnel actions affecting reward or punishment of employees or
applicants where there is a family relationship or is or appears to be a
personal or social involvement.

     

    5.           Initiating
or approving any form of personal or social harassment of
employees.

     

    6.           Investing
or holding outside directorship in suppliers, customers, or competing companies,
including financial speculations, where such investment or directorship might
influence in any manner a decision or course of action of the
Company.

     

    7.           Borrowing
from or lending to employees, customers or suppliers.  Acquiring real
estate of interest to the Company.

     

    8.           Improperly
using or disclosing to the Company

     

    9.           Improperly
using or disclosing to the Company any proprietary information or trade secrets
of any former or concurrent employer or other person or entity with whom
obligations of confidentiality exist.

     

    10.        Unlawfully
discussing prices, costs, customers, sales or markets with competing companies
or their employees.

     

    11.        Making
any unlawful agreement with distributors with respect to prices.

     

    12.        Improperly
using or authorizing the use of any inventions which are the subject of patent
claims of any other person or entity.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    13.        Engaging
in any conduct which is not in the best interest of the Company.

     

    Each
officer, employee and independent contractor must take every necessary action to
ensure compliance with these guidelines and to bring problem areas to the
attention of higher management for review.  Violations of this
conflict of interest policy may result in discharge without
warning.

    
      
         

      

      
        2.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}]]