Vascular Biogenics Ltd.
Annual Report 2017

Plain-text annual report

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549 FORM 20-F (Mark One) ☐REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2017 OR ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event requiring this shell company report: Not applicableFor the transition period from to Commission file number 001-36581 Vascular Biogenics Ltd.(Exact name of registrant as specified in its charter) N/A(Translation of Registrant’s name into English)Israel(Jurisdiction of incorporation or organization)8 HaSatat StModi’inIsrael 7178106(Address of principal executive offices)Dror Harats, Chief Executive Officer8 HaSatat St.Modi’inIsrael 7178106Tel: +972-8-9935000(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)Securities registered or to be registered pursuant to Section 12(b) of the Act. Title of Each Class Name of Each Exchange on which RegisteredOrdinary Shares, par value NIS 0.01 each The NASDAQ Stock Market LLC Securities registered or to be registered pursuant to Section 12(g) of the Act. NoneSecurities for which there is a reporting obligation pursuant to Section 15(d) of the Act. None Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report. As of December 31, 2017, the Registrant had 29,879,323 Ordinary Shares outstanding. Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒ If this report is an annual report or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) ofthe Securities Exchange Act of 1934. Yes ☐ No ☒ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filingrequirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required tobe submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period thatthe registrant was required to submit and post such files) Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or an emerging growth company. Seedefinition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☒ Non-accelerated filer ☐Emerging Growth Company ☒ If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected notto use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of theExchange Act. ☐ † The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its AccountingStandards Codification after April 5, 2012. Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing: U.S. GAAP ☐ International Financing Reporting Standards as issuedby the International Accounting Standards Board ☒ Other ☐ If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐ If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ Table of Contents TABLE OF CONTENTS PART I 5Item 1. Identity of Directors, Senior Management and Advisers 5Item 2. Offer Statistics and Expected Timetable 5Item 3. Key Information 5Item 4. Information on the Company 46Item 4A. Unresolved Staff Comments 59Item 5. Operating and Financial Review and Prospects 71Item 6. Directors, Senior Management and Employees 89Item 7. Major Shareholders and Related Party Transactions 92Item 8. Financial Information 92Item 9. The Offer and Listing 92Item 10. Additional Information 93Item 11. Quantitative and Qualitative Disclosures About Market Risk 110Item 12. Description of Securities Other Than Equity Securities 110PART II 111Item 13. Defaults, Dividend Arrearages and Delinquencies 111Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds 111Item 15. Controls and Procedures 111Item 16. [Reserved] 112Item 16A. Audit committee financial expert 112Item 16B. Code of Ethics 112Item 16C. Principal Accountant Fees and Services 113Item 16D. Exemptions from the Listing Standards for Audit Committees 113Item 16E. Purchase of Equity Securities by the Issuer and Affiliated Purchasers 113Item 16F. Change in Registrant’s Certifying Accountant 113Item 16G. Corporate Governance 113Item 16H. Mine Safety Disclosure 114PART III F-1Item 17. Financial Statements F-1Item 18. Financial Statements F-1Item 19. Exhibits 115 2 Table of Contents General Matters In this Annual Report on Form 20-F (“Annual Report”), unless the context indicates otherwise, references to “NIS” are to the legal currency of Israel,“U.S. dollars,” “$” or “dollars” are to United States dollars, and the terms “we,” “us,” “our company,” “our,” and “Vascular Biogenics” refer to VascularBiogenics Ltd. Cautionary Note Regarding Forward-Looking Statements This Annual Report contains forward-looking statements that relate to future events or our future financial performance, which express the currentbeliefs and expectations of our management. Such statements involve a number of known and unknown risks, uncertainties and other factors that couldcause our actual future results, performance or achievements to differ materially from any future results, performance or achievements expressed or impliedby such forward-looking statements. Forward-looking statements include all statements that are not historical facts and can be identified by words such as,but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “likely,” “will,” “would,” “could,” and similar expressionsor phrases. We have based these forward-looking statements largely on our management’s current expectations and future events and financial trends thatwe believe may affect our financial condition, results of operations, business strategy and financial needs. Forward-looking statements include, but are notlimited to, statements about: ●the initiation, timing, progress and results of our pre-clinical and clinical trials, and our research and development programs; ●our expectations about the availability of data from our clinical trials; ●our ability to advance product candidates into, and successfully complete, clinical trials; ●our plans for future trials; ●our ability to manufacture our product candidates in sufficient quantities for clinical trials; ●the timing or likelihood of regulatory filings and approvals; ●the commercialization of our product candidates, if approved; ●potential advantages of our product candidates; ●the pricing and reimbursement of our product candidates, if approved; ●our ability to develop and commercialize additional product candidates based on our platform technologies; ●our business strategy; ●the implementation of our business model, strategic plans for our business, product candidates and technology; ●the scope and duration of protection we are able to establish and maintain for intellectual property rights covering our product candidatesand technology; ●estimates of our expenses, future revenues, capital requirements and our needs for additional financing; ●our ability to establish and maintain collaborations and the benefits of such collaborations; ●our ability to maintain our level of grant funding or obtain additional grant funding; ●developments relating to our competitors and our industry; and ●other risks and uncertainties, including those listed under the caption “Risk Factors.” 3 Table of Contents All forward-looking statements involve risks, assumptions and uncertainties. You should not rely upon forward-looking statements as predictors offuture events. The occurrence of the events described, and the achievement of the expected results, depend on many events, some or all of which are notpredictable or within our control. Actual results may differ materially from expected results. See the sections “Item 3. Key Information—D. Risk Factors,”“Item 5. Operating and Financial Review and Prospectus” and elsewhere in this Annual Report for a more complete discussion of these risks, assumptionsand uncertainties and for other risks and uncertainties. These risks, assumptions and uncertainties are not necessarily all of the important factors that couldcause actual results to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also couldharm our results. All of the forward-looking statements we have included in this Annual Report are based on information available to us on the date of this AnnualReport. We undertake no obligation, and specifically decline any obligation, to update publicly or revise any forward-looking statements, whether as aresult of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in thisAnnual Report might not occur. The audited financial statements for the years ended December 31, 2017, 2016 and 2015 in this Annual Report have been prepared in accordancewith the International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). 4 Table of Contents PART I Item 1. Identity of Directors, Senior Management and Advisers Not applicable. Item 2. Offer Statistics and Expected Timetable Not applicable. Item 3. Key Information A. Selected Financial Data The following table summarizes our financial data. We have derived the summary statements of operations data for the years ended December 31, 2017,2016, and 2015, and the balance sheet data as of December 31, 2017 and 2016 from our audited financial statements included elsewhere in this AnnualReport. The statements of operations data for the years ended December 31, 2014 and 2013, and the balance sheet data as of December 31, 2015, 2014 and2013 is derived from audited financial statements not included in this Annual Report. The summary of our financial data set forth below should be read together with our audited financial statements and the related notes, as well as thesection entitled “Item 5. Operating and Financial Review and Prospects,” included elsewhere in this Annual Report. For the year ended December 31, (in thousands, except share and per-share data) 2017 2016 2015 2014 2013 Statements of operations data: Revenues $13,864 $— $— $— $— Cost of revenues (340) — — — — Gross Profit $13,524 $— $— $— $— Research and development expenses, net $17,770 $12,447 $11,198 $10,974 $13,508 Marketing expenses 562 — — — — General and administrative expenses 5,847 3,828 3,673 3,804* 2,452 Operating loss 10,655 16,275 14,871 14,778 15,960 Financial income (544) (285) (100) (15) (240)Financial expenses: Loss from change in fair value of convertible loan — — — 2,342 1,638 Other financial expenses 27 12 117 302 12 Financial (income) expenses, net (517) (273) 17 2,629 1,410 Other comprehensive loss (income) 24 5 (6) (10) (22)Comprehensive loss $10,162 $16,007 14,882 $17,397 $17,348 Loss per ordinary share, basic and diluted $0.37 $0.64 $0.73 $3.09 $15.82 Weighted average ordinary shares outstanding, basicand diluted 27,398,169 24,970,585 20,309,596 5,627,324 1,098,248 *Includes a one-time expense related to the IPO grant of options to our Chief Executive Officer of $2.2 million. December 31, 2017 2016 2015 2014 2013 (in thousands) Statements of financial position data: Cash and cash equivalents and short-term bankdeposits $54,729 $45,254 $37,146 $36,783 $10,871 Total assets 65,689 47,274 39,238 38,138 11,827 Total liabilities 9,789 4,874 4,231 3,036 35,410 Total equity (capital deficiency) 55,900 42,400 35,007 35,102 (23,583) 5 Table of Contents B. Capitalization and Indebtedness Not applicable. C. Reasons for the Offer and Use of Proceeds Not applicable. D. Risk Factors You should consider carefully the risks and uncertainties described below, together with all of the other information in this Annual Report, includingthe financial statements and the related notes included elsewhere in this Annual Report. The risks and uncertainties described below are not the only oneswe face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors thatadversely affect our business. If any of the following risks actually occurs, our business, financial condition, results of operations, and future prospectscould be materially and adversely affected. Risks Related to Our Financial Condition and Capital Requirements We have incurred significant losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future. We are a clinical-stage biotechnology company, and we have not yet generated any regular revenue streams. We have incurred losses in each year since ourinception in 2000, including net losses of $10.1 million, $16.0 million and $14.9 million for the years ended December 31, 2017, 2016 and 2015,respectively. As of December 31, 2017, we had an accumulated deficit of $168.2 million. We have devoted most of our financial resources to research and development, including our clinical and pre-clinical development activities. To date, wehave financed our operations primarily through the sale of equity securities and convertible debt and, to a lesser extent, through grants from governmentalagencies. The amount of our future net losses will depend, in part, on the rate of our future expenditures and our ability to obtain funding through equity ordebt financings, strategic collaborations or additional grants. We have completed only a single pivotal clinical trial for our product candidates and it will bea few years, if ever, before we have a product candidate ready for commercialization. Even if we obtain regulatory approval to market a product candidate, ourfuture revenues will depend upon the size of any markets in which our product candidates have received approval, and our ability to achieve sufficientmarket acceptance, reimbursement from third-party payors and adequate market share for our product candidates in those markets. We expect to continue to incur significant expenses and increasing operating losses for the foreseeable future. We anticipate that our expenses will increasesubstantially if and as we: ●continue our research and pre-clinical and clinical development of our product candidates; ●expand the scope of our current clinical trials for our product candidates; ●initiate additional pre-clinical, clinical or other studies for our product candidates; ●seek regulatory and marketing approvals for any of our product candidates that successfully complete clinical trials; ●further develop the manufacturing process for our product candidates; ●Operate and possibly expand our new, commercial scale manufacturing facility; ●change or add additional manufacturers or suppliers; 6 Table of Contents ●establish a sales, marketing and distribution infrastructure to commercialize any products for which we may obtain marketing approval; ●seek to identify and validate additional product candidates; ●acquire or in-license other product candidates and technologies; ●make milestone or other payments under any in-license or other intellectual property related agreements, including our agreement with TelHashomer—Medical Research, Infrastructure and Services Ltd. and our license from Crucell Holland B.V., or Crucell, and any otherlicensing arrangements we may enter into the future; ●maintain, protect and expand our intellectual property portfolio; ●attract and retain skilled personnel; ●create additional infrastructure to support our operations as a public company; and ●experience any delays or encounter issues with any of the above. The net losses we incur may fluctuate significantly from quarter to quarter and year to year, such that a period-to-period comparison of our results ofoperations may not be a good indication of our future performance. In any particular quarter or quarters, our operating results could be below the expectationsof securities analysts or investors, which could cause our share price to decline. We have never generated any revenue from product sales and may never be profitable. Our ability to generate revenue and achieve profitability depends on our ability, alone or with strategic collaboration partners, to successfully complete thedevelopment of, obtain the regulatory approvals of, and commercialize our product candidates. We do not anticipate generating revenues from product salesfor the foreseeable future, if ever. Our ability to generate future revenues from product sales depends heavily on our success in: ●completing research and pre-clinical and clinical development of our product candidates; ●seeking and obtaining regulatory and marketing approvals for product candidates for which we complete clinical trials; ●developing a sustainable, scalable, reproducible, and transferable manufacturing process for our product candidates; ●establishing and maintaining supply and manufacturing relationships with third parties that can provide products and services adequate, inamount and quality, to support clinical development and the market demand for our product candidates, if approved; ●And/or successfully establishing, validating and operating our own manufacturing facilities to produce our products in amount and quality,to support clinical development and the market demand for our product candidates, if approved, as well as gaining the health authorities,such as the FDA and EMEA, approval for our manufacturing facility and product. ●launching and commercializing any product candidates for which we obtain regulatory and marketing approval, either by collaboratingwith a partner or, if launched independently, by establishing a sales, marketing and distribution infrastructure; ●obtaining market acceptance of any product candidates that receive regulatory approval as viable treatment options; ●addressing any competing technological and market developments; ●implementing additional internal systems and infrastructure, as needed; 7 Table of Contents ●identifying and validating new product candidates; ●negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter; ●maintaining, protecting and expanding our portfolio of intellectual property rights, including patents, trade secrets and know-how; and ●attracting, hiring and retaining qualified personnel. Even if one or more of our product candidates is approved for commercial sale, we anticipate incurring significant costs associated with commercializing anyapproved product candidate. Our expenses could increase beyond expectations if we are required by the FDA, the European Medicines Agency, or the EMA,or other regulatory agencies, domestic or foreign, to perform clinical and other studies in addition to those that we currently anticipate. Even if we are able togenerate revenues from the sale of any approved products, we may not become profitable and may need to obtain additional funding to continue operations. We will need to raise additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when neededmay force us to delay, limit or terminate our product development efforts or other operations. We are currently advancing VB-111 for solid cancer indications. We intend to advance this current clinical product candidate through clinical developmentand other product candidates through pre-clinical and clinical development. Developing pharmaceutical products is expensive, and we expect our researchand development expenses to increase substantially in connection with our ongoing activities, particularly as we advance our product candidates in clinicaltrials. As of December 31, 2017, our cash and cash equivalents and short-term bank deposits were $54.7 million. As of December 31, 2017, we estimate that ourexisting cash, cash equivalents and short-term bank deposits will be sufficient to fund our operations through 2020. However, our operating plan may changeas a result of many factors currently unknown to us, and we may need to seek additional funds sooner than planned through public or private equity or debtfinancings, government or other third-party funding, marketing and distribution arrangements and other collaborations, strategic alliances and licensingarrangements or a combination of these approaches. In any event, we might require additional capital to obtain regulatory approval for our productcandidates, and to commercialize any that receive regulatory approval. Raising funds in the current economic environment may present additionalchallenges. Even if we believe we have sufficient funds for our current or future operating plans, we may seek additional capital if market conditions arefavorable or if we have specific strategic considerations. Any additional fundraising efforts may divert our management from their day-to-day activities, which may compromise our ability to develop andcommercialize our product candidates. In addition, we cannot guarantee that future financing will be available in sufficient amounts or on terms acceptableto us, if at all. Moreover, the terms of any financing may adversely affect the holdings or the rights of our shareholders, and the issuance of additionalsecurities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our ordinary shares to decline. The sale ofadditional equity or convertible securities would dilute all of our shareholders. The incurrence of indebtedness would result in increased fixed paymentobligations and we may be required to agree to certain restrictive covenants such as limitations on our ability to incur additional debt, limitations on ourability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business.We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable,and we may be required to relinquish rights to some of our technologies or product candidates or otherwise agree to terms unfavorable to us. 8 Table of Contents If we are unable to obtain funding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our research ordevelopment programs or the commercialization of any product candidates, and we may be unable to expand our operations or otherwise capitalize on ourbusiness opportunities, as desired. We have received and may continue to receive Israeli governmental grants to assist in the funding of our research and development activities. If we loseour funding from these research and development grants, we may encounter difficulties in the funding of future research and development projects andimplementing technological improvements, which would harm our operating results. Through December 31, 2017 we had received an aggregate of $22.0 million in the form of grants from the Israeli Office of the Chief Scientist, or OCS, whichhas later transformed to the Israeli Innovation Authority, or IIA. The requirements and restrictions for such grants are found in the Israel Encouragement ofResearch and Development in Industries, or the Research Law. Under the Research Law, royalties of 3% to 3.5% on the revenues derived from sales ofproducts or services developed in whole or in part using these IIA grants are payable to the Israeli government. We developed both of our platformtechnologies, at least in part, with funds from these grants, and accordingly we would be obligated to pay these royalties on sales of any of our productcandidates that achieve regulatory approval. The maximum aggregate royalties paid generally cannot exceed 100% of the grants made to us, plus annualinterest equal to the 12-month LIBOR applicable to dollar deposits, as published on the first business day of each calendar year. As of December 31, 2017,the balance of the principal and interest in respect of our commitments for future payments to the IIA totaled approximately $26.9 million. As of December31, 2017, we have incurred a $510 thousand royalty payment to the IIA derived from an upfront and a milestone payment. As part of funding our current andplanned product development activities, we submitted follow-up grant application. Following the recent results in our Phase 3 study in rGBM, we might failto gain an IIA grant for our development activities in 2018. These grants have funded some of our personnel, development activities with subcontractors and other research and development costs and expenses.However, if these awards are not funded in their entirety or if new grants are not awarded in the future, due to, for example, IIA budget constraints orgovernmental policy decisions, our ability to fund future research and development and implement technological improvements would be impaired, whichwould negatively impact our ability to develop our product candidates. The Israeli government grants we have received for research and development expenditures restrict our ability to manufacture products and transfertechnologies outside of Israel and require us to satisfy specified conditions. If we fail to satisfy these conditions, we may be required to refund grantspreviously received together with interest and penalties. Our research and development efforts have been financed, in part, through the grants that we have received from the IIA. We, therefore, must comply with therequirements of the Research Law. Under the Research Law, we are required to manufacture the major portion of each of our products developed using these grants in the State of Israel orotherwise ask for special approvals. We may not receive the required approvals for any proposed transfer of manufacturing activities. Even if we do receiveapproval to manufacture products developed with government grants outside of Israel, the royalty rate may be increased and we may be required to pay up to300% of the grant amounts plus interest, depending on the manufacturing volume that is performed outside of Israel. This restriction may impair our abilityto outsource manufacturing or engage in our own manufacturing operations for those products or technologies. See “Item 5. Operating and Financial Reviewand Prospects—Financial Overview—Research and Development Expenses” for additional information. 9 Table of Contents Additionally, under the Research Law, we are prohibited from transferring, including by way of license, the IIA-financed technologies and related intellectualproperty rights and know-how outside of the State of Israel, except under limited circumstances and only with the approval of the IIA Research Committee.We may not receive the required approvals for any proposed transfer and, even if received, we may be required to pay the IIA a portion of the considerationthat we receive upon any sale of such technology to a non-Israeli entity up to 600% of the grant amounts plus interest. The scope of the support received, theroyalties that we have already paid to the IIA, the amount of time that has elapsed between the date on which the know-how or the related intellectualproperty rights were transferred and the date on which the IIA grants were received and the sale price and the form of transaction will be taken into account inorder to calculate the amount of the payment to the IIA. Approval of the transfer of technology to residents of the State of Israel is required, and may begranted in specific circumstances only if the recipient abides by the provisions of applicable laws, including the restrictions on the transfer of know-how andthe obligation to pay royalties. No assurance can be made that approval to any such transfer, if requested, will be granted. These restrictions may impair our ability to sell our technology assets or to perform or outsource manufacturing outside of Israel, engage in change of controltransactions or otherwise transfer our know-how outside of Israel and may require us to obtain the approval of the IIA for certain actions and transactions andpay additional royalties and other amounts to the IIA. In addition, any change of control and any change of ownership of our ordinary shares that would makea non-Israeli citizen or resident an “interested party,” as defined in the Research Law, requires prior written notice to the IIA, and our failure to comply withthis requirement could result in criminal liability. These restrictions will continue to apply even after we have repaid the full amount of royalties on the grants. For the years ended December 31, 2017, 2016and, 2015, we recorded grants totaling $2.7 million, $1.7 million, and $1.9 million from the IIA, respectively. The grants represented 14%, 12%, and 14%respectively, of our gross research and development expenditures for the years ended December 31, 2017, 2016 and, 2015. If we fail to satisfy the conditionsof the Research Law, we may be required to refund certain grants previously received together with interest and penalties, and may become subject tocriminal charges. Risks Related to the Discovery and Development of Our Product Candidates We have planned on the future success of our lead product candidate, VB-111, that missed the primary end points in the Phase 3 study and continue toadvance it for other indications. Any failure to successfully develop, obtain regulatory approval for and commercialize VB-111 for cancer indications,independently or in cooperation with a third party collaborator, or the experience of significant delays in doing so, would compromise our ability togenerate revenue and become profitable. We have invested a significant portion of our efforts and financial resources in the development of VB-111 for rGBM and VB-201 for psoriasis and ulcerativecolitis for which we have completed clinical trials in which they did not meet their primary endpoints. Our ability to generate product revenue from ourproduct candidate depends heavily on the successful development and commercialization of our products, which, in turn, depends on several factors,including the following: ●our ability to continue and support the VTS platform technology and its lead candidate VB-111; ●successfully completing our ongoing and future trials of VB-111; ●our ability to raise additional funding sufficient to conduct future clinical trials; ●demonstrating that VB-111 for cancer indications is safe and effective at a sufficient level of statistical or clinical significance andotherwise obtaining marketing approvals from regulatory authorities; ●establishing successful manufacturing arrangements with third-party manufacturers that are compliant with current good manufacturingpractices, or cGMP, and which will ensure the development of a large scale manufacturing process and adequate facilities or being able toconduct such manufacturing ourselves; 10 Table of Contents ●operating our facility for the manufacture of commercial quantities of our candidate products, if approved; ●establishing successful sales and marketing arrangements for our products, if approved; ●maintaining an acceptable safety and efficacy profile for our products; ●the availability of coverage and reimbursement to patients from healthcare payors for our products, if approved; and ●other risks described in these “Risk Factors.” Our product candidates are based on novel technologies, which makes it difficult to predict the time and cost of product candidate development andpotential regulatory approval. We have concentrated our product research and development efforts on our two distinct platform technologies, and our future success depends on thesuccessful development of these technologies. We could experience development problems in the future related to our technologies, which could causesignificant delays or unanticipated costs, and we may not be able to solve such development problems. We may also experience delays in developing asustainable, reproducible and scalable manufacturing process or transferring that process to commercial partners, if we decide to do so, which may prevent usfrom completing our clinical trials or commercializing our products on a timely or profitable basis, if at all. In addition, the clinical trial requirements of the FDA, the EMA and other regulatory agencies and the criteria these regulators use to determine the safety andefficacy of a product candidate vary substantially according to the type, complexity, novelty and intended use and market of the potential products. Theregulatory approval process for novel product candidates such as ours can be more expensive and take longer than for other, better known or extensivelystudied pharmaceutical or other product candidates. Approvals by the FDA may not be indicative of what the EMA or other regulatory agencies may requirefor approval, and vice versa. Regulatory requirements governing pharmaceutical products have changed frequently and may continue to change in the future. Also, before a clinical trialcan begin at an institution funded by the U.S. National Institutes of Health, or the NIH, that institution’s institutional review board, or IRB, and itsInstitutional Biosafety Committee will have to review the proposed clinical trial to assess the safety of the trial. In addition, adverse developments in clinicaltrials of pharmaceutical products conducted by others may cause the FDA or other regulatory bodies to change the requirements for approval of any of ourproduct candidates. These regulatory agencies and review committees and the new requirements and guidelines they promulgate may lengthen the regulatory review process,require us to perform additional studies, increase our development costs, lead to changes in regulatory positions and interpretations, delay or preventapproval and commercialization of these treatment candidates or lead to significant post-approval limitations or restrictions. As we advance our productcandidates, we will be required to consult with these regulatory groups, and comply with applicable requirements and guidelines. If we fail to do so, we maybe required to delay or discontinue development of our product candidates. Delay or failure to obtain, or unexpected costs in obtaining, the regulatoryapproval necessary to bring a potential product candidate to market could impair our ability to generate product revenue and to become profitable. We may find it difficult to enroll patients in our clinical trials, and patients could discontinue their participation in our clinical trials, which could delayor prevent clinical trials of our product candidates. Identifying and qualifying patients to participate in clinical trials of our product candidates is critical to our success. The timing of our clinical trials dependson the speed at which we can recruit patients to participate in testing our product candidates. We have experienced delays in some of our clinical trials, andwe may experience similar delays in the future. If patients are unwilling to participate in our clinical trials because of negative publicity from adverse eventsin the biotechnology or pharmaceutical industries or for other reasons, including competitive clinical trials for similar patient populations, the timeline forrecruiting patients, conducting trials and obtaining regulatory approval of potential products may be delayed. These delays could result in increased costs,delays in advancing our product development, delays in testing the effectiveness of our technology or termination of the clinical trials altogether. 11 Table of Contents We may not be able to identify, recruit and enroll a sufficient number of patients, or those with required or desired characteristics to achieve diversity in atrial, to complete our clinical trials in a timely manner. Patient enrollment is affected by factors including: ●severity of the disease under investigation; ●design of the trial protocol; ●size of the patient population; ●eligibility criteria for the trial in question; ●perceived risks and benefits of the product candidate under study, and specifically in reference to studies in other indications, with the sameproduct; ●proximity and availability of clinical trial sites for prospective patients; ●availability of competing therapies and clinical trials; ●efforts to facilitate timely enrollment in clinical trials; ●patient referral practices of physicians; and ●ability to monitor patients adequately during and after treatment. In particular, VB-111 for ovarian cancer is intended for a rare disorder with limited patient pools from which to draw for clinical trials. The eligibility criteriaof our clinical trials will further limit the pool of available trial participants. Additionally, the process of finding and diagnosing patients may prove costly. We plan to seek initial marketing approval in Europe in addition to the United States. We may not be able to initiate or continue clinical trials if we cannotenroll a sufficient number of eligible patients to participate in the clinical trials required by the EMA or other foreign regulatory agencies. Our ability tosuccessfully initiate, enroll and complete a clinical trial in any foreign country is subject to numerous risks unique to conducting business in foreigncountries, including: ●difficulty in establishing or managing relationships with contract research organizations, or CROs, and physicians; ●different standards for the conduct of clinical trials; ●our inability to locate qualified local consultants, physicians and partners; and ●the potential burden of complying with a variety of foreign laws, medical standards and regulatory requirements, including the regulationof pharmaceutical and biotechnology products and treatment. If we have difficulty enrolling a sufficient number of patients to conduct our clinical trials as planned, we may need to delay, limit or terminate ongoing orplanned clinical trials. In addition, patients enrolled in our clinical trials may discontinue their participation at any time during the trial as a result of a number of factors, includingwithdrawing their consent or experiencing adverse clinical events, which may or may not be judged related to our product candidates under evaluation. Thediscontinuation of patients in any one of our trials may cause us to delay or abandon our clinical trial, or cause the results from that trial not to be positive orsufficient to support a filing for regulatory approval of the applicable product candidate. 12 Table of Contents We may encounter substantial delays in our clinical trials or we may fail to demonstrate safety and efficacy to the satisfaction of applicable regulatoryauthorities. We are currently in Phase 3 clinical trial for VB-111 for ovarian cancer and plan a Phase 1/2 clinical trials for VB-111 for lung cancer in combination withimmune-oncology drug. We intend to revisit the scope of these studies as soon as we complete our analysis and conclusions from the recent results of theGLOBE study. Before obtaining marketing approval from regulatory authorities for the sale of our product candidates, we must conduct extensive clinicaltrials to demonstrate the safety and efficacy of the product candidates in humans. Clinical testing is expensive, time-consuming and uncertain as to outcome.We cannot guarantee that any clinical trials will be conducted as planned or completed on schedule, if at all. A failure of one or more clinical trials can occurat any stage of testing. Events that may prevent successful or timely completion of clinical development include: ●delays in reaching a consensus with regulatory agencies on trial design; ●delays in reaching agreement on acceptable terms with prospective CROs and clinical trial sites; ●delays in obtaining required IRB approval at each clinical trial site; ●delays in recruiting suitable patients to participate in our clinical trials including in particular for those trials for rare diseases such asovarian cancer; ●imposition of a clinical hold by regulatory agencies, including after an inspection of our clinical trial operations or trial sites; ●failure by our CROs, other third parties or us to adhere to clinical trial requirements; ●failure to perform in accordance with the FDA’s good clinical practices, or GCP, or applicable regulatory requirements in other countries; ●delays in the testing, validation, manufacturing and delivery of our product candidates to the clinical sites; ●delays in having patients complete participation in a trial or return for post-treatment follow-up; ●clinical trial sites or patients dropping out of a trial; ●occurrence of serious adverse events associated with the product candidate that are viewed to outweigh its potential benefits; or ●changes in regulatory requirements and guidance that require amending or submitting new clinical trial protocols. Any inability to successfully complete pre-clinical and clinical development could result in additional costs to us or impair our ability to generate revenuefrom product sales. In addition, if we make manufacturing or formulation changes to our product candidates, we may need to conduct additional studies tobridge our modified product candidates to earlier versions. Clinical trial delays could also shorten any periods during which we may have the exclusive rightto commercialize our product candidates or allow our competitors to bring products to market before we do, which could impair our ability to successfullycommercialize our product candidates. If the results of our clinical trials are inconclusive or if there are safety concerns or adverse events associated with our product candidates, we may: ●fail to obtain, or be delayed in obtaining, marketing approval for our product candidates; ●obtain approval for indications or patient populations that are not as broad as intended or desired; ●obtain approval with labeling that includes significant use or distribution restrictions or safety warnings; ●need to change the way the product is administered; ●be required to perform additional clinical trials to support approval or be subject to additional post-marketing testing requirements; 13 Table of Contents ●have regulatory authorities withdraw their approval of the product or impose restrictions on its distribution in the form of a risk evaluationand mitigation strategy, or REMS, or modified REMS; ●be subject to the addition of labeling statements, such as warnings or contraindications; ●be sued; or ●experience damage to our reputation. Any of these events could prevent us from achieving or maintaining market acceptance of our product candidates and impair our ability to commercialize ourproduct candidates. Side effects may occur following treatment with our product candidates, which could make it more difficult for our product candidates to receiveregulatory approval. Treatment with our product candidates may cause side effects or adverse events. In addition, since our product candidates are in some cases administered incombination with other therapies, patients or clinical trial participants may experience side effects or other adverse events that are unrelated to our productcandidate, but may still impact the success of our clinical trials. Additionally, our product candidates could potentially cause other adverse events that havenot yet been predicted. The inclusion of critically ill patients in our clinical trials may result in deaths or other adverse medical events due to other therapiesor medications that such patients may be using or the severity of the medical condition treated. The experience of side effects and adverse events in ourclinical trials could make it more difficult to achieve regulatory approval of our product candidates or, if approved, could negatively impact the marketacceptance of such products. Success in early and prior clinical trials may not be indicative of results obtained in later trials. There is a high failure rate for drugs and biologics proceeding through clinical trials. A number of companies in the pharmaceutical and biotechnologyindustries have suffered significant setbacks in later stage clinical trials even after achieving promising results in earlier stage and prior clinical trials. Dataobtained from pre-clinical and clinical activities are subject to varying interpretations, which may delay, limit or prevent regulatory approval. In addition,regulatory delays or rejections may be encountered as a result of many factors, including changes in regulatory policy during the period of productdevelopment. 14 Table of Contents The results from our clinical trials may not be sufficiently robust to support the submission for marketing approval for our product candidates. Beforewe submit our product candidates for marketing approval, the FDA and the EMA may require us to conduct additional clinical trials, or evaluatesubjects for an additional follow-up period. It is possible that, even if we achieve favorable results in our clinical trials, the FDA may require us to conduct additional clinical trials, possibly involving alarger sample size or a different clinical trial design, particularly if the FDA does not find the results from our completed clinical trials to be sufficientlypersuasive to support a Biologics License Application, or BLA, or a New Drug Application, or NDA. For example, because the dose we used in our Phase 2trial was limited by our production capacity, the dose of VB-111 that we intend to use in our Phase 3 potential registration trial may not be the maximumefficacious dose. The FDA might require data on higher doses of VB-111, this will likely delay development. The FDA may also require that we conduct alonger follow-up period of subjects treated with our product candidates prior to accepting our BLA or NDA. It is possible that the FDA or the EMA may not consider the results of our clinical trials to be sufficient for approval of our product candidates for their targetindications. If the FDA or the EMA requires additional studies for any reason, we would incur increased costs and delays in the marketing approval process,which may require us to expend more resources than we have available. In addition, it is possible that the FDA and the EMA may have divergent opinions onthe elements necessary for a successful BLA or NDA and Marketing Authorization Application, which is the equivalent of a BLA, respectively, which maycause us to alter our development, regulatory or commercialization strategies. Even if we complete the necessary pre-clinical studies and clinical trials, we cannot predict when or if we will obtain regulatory approval tocommercialize a product candidate or the approval may be for a more narrow indication than we expect. We cannot commercialize a product until the appropriate regulatory authorities have reviewed and approved the product candidate. Even if our productcandidates demonstrate safety and efficacy in clinical trials, the regulatory agencies may not complete their review processes in a timely manner, or we maynot be able to obtain regulatory approval. Additional delays may result if an FDA Advisory Committee or other regulatory authority recommends non-approval or restrictions on approval. In addition, we may experience delays or rejections based upon additional government regulation from futurelegislation or administrative action, or changes in regulatory agency policy during the period of product development, clinical trials and the review process.Regulatory agencies also may approve a treatment candidate for fewer or more limited indications than requested or may grant approval subject to theperformance of post-marketing studies. In addition, regulatory agencies may not approve the labeling claims that are necessary or desirable for the successfulcommercialization of our treatment candidates. A fast track designation by the FDA may not actually lead to a faster development or regulatory review or approval process. If a drug is intended for the treatment of a serious or life-threatening disease or condition and the drug demonstrates the potential to address unmet medicalneeds for this disease or condition, the drug sponsor may apply for FDA fast track designation. If fast track designation is obtained, the FDA may initiatereview of sections of a new drug application, or NDA, before the application is complete. This “rolling review” is available if the applicant provides, and theFDA approves, a schedule for submission of the individual sections of the application. 15 Table of Contents We have received fast track designation from the FDA for VB-111 for prolongation of survival in patients with glioblastoma that has recurred followingtreatment with temozolomide, a chemotherapeutic agent commonly used to treat newly diagnosed glioblastoma, and radiation. We may seek fast trackdesignation for other product candidates and other indications. Even though we have received fast track designation, we may not experience a fasterdevelopment process, review or approval compared to conventional FDA procedures. The FDA may withdraw fast track designation if it believes that thedesignation is no longer supported by data from our clinical development program. Our fast track designation does not guarantee that we will qualify for orbe able to take advantage of the expedited review procedures or that we will ultimately obtain regulatory approval of VB-111. Even though we have obtained orphan drug designation for VB-111 for treatment of malignant glioma in the United States and glioma in Europe, andfor the treatment of ovarian cancer in Europe, we may not be able to obtain orphan drug exclusivity for this drug or for any of our other productcandidates. Regulatory authorities in some jurisdictions, including the United States and Europe, may designate drugs for relatively small patient populations as orphandrugs. Under the Orphan Drug Act, the FDA may designate a product as an orphan drug if it is a drug intended to treat a rare disease or condition, which isgenerally defined as a patient population of fewer than 200,000 individuals annually in the United States. For VB-111, we have obtained orphan drugdesignation from the FDA for the treatment of malignant glioma and the EMA for the treatment of glioma and ovarian cancer, and we may seek orphan drugdesignation for other drug candidates. Generally, if a product with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has suchdesignation, the product is entitled to a period of marketing exclusivity, which precludes the EMA or the FDA from approving another marketing applicationfor the same drug for the same use or indication for that time period. The applicable period is seven years in the United States and ten years in Europe. TheEuropean exclusivity period can be reduced to six years if a drug no longer meets the criteria for orphan drug designation or if the drug is sufficientlyprofitable so that market exclusivity is no longer justified. Orphan drug exclusivity may be lost if the FDA or EMA determines that the request fordesignation was materially defective or if the manufacturer is unable to assure sufficient quantity of the drug to meet the needs of patients with the raredisease or condition. Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different drugscan be approved for the same condition. Even after an orphan drug is approved, the FDA can subsequently approve the same drug for the same condition ifthe FDA concludes that the later drug is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care. Even if we obtain regulatory approval for a product candidate, our products will remain subject to regulatory scrutiny. Even if we obtain regulatory approval in a jurisdiction, the regulatory authority may still impose significant restrictions on the indicated uses or marketing ofour product candidates, or impose ongoing requirements for potentially costly post-approval studies or post-market surveillance. For example, the holder ofan approved BLA is obligated to monitor and report adverse events and any failure of a product to meet the specifications in the BLA. The holder of anapproved BLA must also submit new or supplemental applications and obtain FDA approval for certain changes to the approved product, product labeling ormanufacturing process. Advertising and promotional materials must comply with FDA rules and are subject to FDA review, in addition to other potentiallyapplicable federal and state laws. In addition, product manufacturers and their facilities are subject to payment of user fees and continual review and periodic inspections by the FDA and otherregulatory authorities for compliance with cGMP, and adherence to commitments made in the BLA or NDA as the case may be. If we or a regulatory agencydiscover previously unknown problems with a product such as adverse events of unanticipated severity or frequency, or problems with the facility where theproduct is manufactured, a regulatory agency may impose restrictions relative to that product or the manufacturing facility, including requiring recall orwithdrawal of the product from the market or suspension of manufacturing. 16 Table of Contents If we fail to comply with applicable regulatory requirements following approval of any of our product candidates, a regulatory agency may: ●issue a warning letter asserting that we are in violation of the law; ●seek an injunction or impose civil or criminal penalties or monetary fines; ●suspend or withdraw regulatory approval; ●suspend any ongoing clinical trials; ●refuse to approve a pending BLA or NDA or supplements to a BLA or NDA submitted by us for other indications or new drug products; ●seize our product; or ●refuse to allow us to enter into supply contracts, including government contracts. Any government investigation of alleged violations of law could require us to expend significant time and resources in response and could generate negativepublicity. The occurrence of any event or penalty described above may inhibit our ability to commercialize our product candidates and generate revenues. We have only limited experience in regulatory affairs and intend to rely on consultants and other third parties for regulatory matters, which may affectour ability or the time we require to obtain necessary regulatory approvals. We have limited experience in filing and prosecuting the applications necessary to gain regulatory approvals for drug and biologics candidates. Moreover,the product candidates that are likely to result from our development programs are based on new technologies that have not been extensively tested inhumans. The regulatory requirements governing these types of product candidates may be less well defined or more rigorous than for conventional products.As a result, we may experience a longer regulatory process in connection with obtaining regulatory approvals of any products that we develop. We intend torely on independent consultants for purposes of our regulatory compliance and product development and approvals in the United States and elsewhere. Anyfailure by our consultants to properly advise us regarding, or properly perform tasks related to, regulatory compliance requirements could compromise ourability to develop and seek regulatory approval of our product candidates. In addition to the level of commercial success of our product candidates, if approved, our future prospects are also dependent on our ability tosuccessfully develop a pipeline of additional product candidates, and we may not be successful in our efforts in using our platform technologies toidentify or discover additional product candidates. The success of our business depends primarily upon our ability to identify, develop and commercialize products based on our two platform technologies. Ourresearch programs may fail to identify other potential product candidates for clinical development for a number of reasons. Our research methodology may beunsuccessful in identifying potential product candidates or our potential product candidates may be shown to have harmful side effects or may have othercharacteristics that may make the products unmarketable or unlikely to receive marketing approval. If any of these events occur, we may be forced to abandon our development efforts for a program or programs. Research programs to identify new productcandidates require substantial technical, financial and human resources. We may focus our efforts and resources on potential programs or product candidatesthat ultimately prove to be unsuccessful. 17 Table of Contents Risks Related to Our Reliance on Third Parties We expect to rely on third parties to conduct some or all aspects of our product manufacturing, protocol development, research and pre-clinical andclinical testing, and these third parties may not perform satisfactorily. We do not expect to independently conduct all aspects of our product manufacturing, protocol development, research and pre-clinical and clinical testing.We currently rely, and expect to continue to rely, on third parties with respect to these items. In addition, we may pursue further clinical development of VB-111 for thyroid cancer or other indications with a strategic partner. Any of these third parties may terminate their engagements with us at any time. If we need to enter into alternative arrangements, it could delay our productdevelopment activities. Our reliance on these third parties for research and development activities will reduce our control over these activities but will notrelieve us of our responsibility to ensure compliance with all required regulations and study protocols. For example, for product candidates that we developand commercialize on our own, we will remain responsible for ensuring that each of our Investigational New Drug, or IND, enabling studies and clinical trialsare conducted in accordance with the study plan and protocols. If these third parties do not successfully carry out their contractual duties, meet expected deadlines or conduct our studies in accordance with regulatoryrequirements or our stated study plans and protocols, we will not be able to complete, or may be delayed in completing, the pre-clinical studies and clinicaltrials required to support future IND submissions and approval of our product candidates. Reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured the product candidates ourselves, including: ●the inability to negotiate manufacturing agreements with third parties under commercially reasonable terms; ●reduced control as a result of using third-party manufacturers for all aspects of manufacturing activities; ●termination or nonrenewal of manufacturing agreements with third parties in a manner or at a time that is costly or damaging to us; and ●disruptions to the operations of our third-party manufacturers or suppliers caused by conditions unrelated to our business or operations,including the bankruptcy of the manufacturer or supplier. Any of these events could lead to clinical trial delays or failure to obtain regulatory approval, or impact our ability to successfully commercialize futureproducts. Some of these events could be the basis for FDA action, including injunction, recall, seizure or total or partial suspension of production. We and our contract manufacturers are subject to significant regulation with respect to manufacturing our product candidates. The manufacturingfacilities on which we rely may not continue to meet regulatory requirements and have limited capacity. We currently have relationships with a limited number of suppliers for the manufacturing of our product candidates. Each supplier may require licenses tomanufacture components of our product candidates or to utilize certain processes for the manufacture of our product candidates. If such components orlicenses are not owned by the supplier or in the public domain, we may be unable to transfer or sublicense the intellectual property rights we may have withrespect to such activities. 18 Table of Contents All entities involved in the preparation of therapeutics for clinical trials or commercial sale, including our existing contract manufacturers for our productcandidates, are subject to extensive regulation. Components of a finished therapeutic product approved for commercial sale or used in late-stage clinicaltrials must be manufactured in accordance with cGMP. These regulations govern manufacturing processes and procedures (including record keeping) and theimplementation and operation of systems to control and assure the quality of investigational products and products approved for sale. Poor control ofproduction processes can lead to the introduction of contaminants, or to inadvertent changes in the properties or stability of our product candidates that maynot be detectable in final product testing. We or our contract manufacturers must supply all necessary documentation in support of a BLA or NDA, asapplicable, on a timely basis and must adhere to the FDA’s good laboratory practices, or GLP, and cGMP regulations enforced by the FDA through itsfacilities inspection program. Our contract manufacturer for VB-111 has not produced a commercially approved product based on viral vectors and thereforehas not yet obtained the requisite FDA approvals to do so. Our facilities and controls and the facilities and controls of some or all of our third-partycontractors must pass a pre-approval inspection for compliance with the applicable regulations as a condition of regulatory approval of our productcandidates or any of our other potential products. In addition, the regulatory authorities may, at any time, audit or inspect a manufacturing facility involvedwith the preparation of our product candidates or our other potential products or the associated controls for compliance with the regulations applicable to theactivities being conducted. If these facilities do not pass a pre-approval plant inspection, FDA approval of the products will not be granted. The regulatory authorities also may, at any time following approval of a product for sale, audit our manufacturing facilities or those of our third-partycontractors. If any such inspection or audit identifies a failure to comply with applicable regulations or our product specifications or if a violation ofapplicable regulations, including a failure to comply with the product specifications, occurs independent of such an inspection or audit, we or the relevantregulatory authority may require remedial measures that may be costly and/or time-consuming for us or a third party to implement and that may include thetemporary or permanent suspension of a clinical trial or commercial sales or the temporary or permanent closure of a facility. If we or any of our third-party manufacturers fail to maintain regulatory compliance, the FDA can impose regulatory sanctions including, among other things,refusal to approve a pending application for a new drug product or biologic product, or revocation of a pre-existing approval. Additionally, if supply from one approved manufacturer is interrupted, there could be a significant disruption in commercial supply. An alternativemanufacturer would need to be qualified through a BLA or NDA supplement which could result in further delay. The regulatory agencies may also requireadditional studies if a new manufacturer is relied upon for commercial production. Switching manufacturers may involve substantial costs and is likely toresult in a delay in our desired clinical and commercial timelines. These factors could cause the delay of clinical trials, regulatory submissions, required approvals or commercialization of our product candidates, cause us toincur higher costs and prevent us from commercializing our products successfully. Furthermore, if our suppliers fail to meet contractual requirements, and weare unable to secure one or more replacement suppliers capable of production at a substantially equivalent cost, our clinical trials may be delayed or we couldlose potential revenue. We expect to rely on third parties to conduct, supervise and monitor our clinical trials, and if these third parties perform in an unsatisfactory manner, itmay harm our business. We expect to rely on CROs and clinical trial sites to ensure our clinical trials are conducted properly and on time. While we will have agreements governingtheir activities, we will have limited influence over their actual performance. We will control only some aspects of our CROs’ activities. Nevertheless, we willbe responsible for ensuring that each of our clinical trials is conducted in accordance with the applicable protocol, legal, regulatory and scientificrequirements and standards, and our reliance on the CROs does not relieve us of our regulatory responsibilities. 19 Table of Contents We and our CROs are required to comply with the FDA’s GCPs for conducting, recording and reporting the results of IND-enabling studies and clinical trialsto assure that the data and reported results are credible and accurate and that the rights, integrity and confidentiality of clinical trial participants are protected.The FDA enforces these GCPs through periodic inspections of study sponsors, principal investigators and clinical trial sites. If we or our CROs fail to complywith applicable GCPs, the clinical data generated in our future clinical trials may be deemed unreliable and the FDA may require us to perform additionalclinical trials before approving any marketing applications. Upon inspection, the FDA may determine that our clinical trials did not comply with GCPs. Inaddition, our future clinical trials will require a sufficient number of test subjects to evaluate the safety and effectiveness of our product candidates.Recruitment may be challenging in the event of rare diseases and may require the performance of trials in a significant number of sites which may be harder tomonitor. Accordingly, if our CROs fail to comply with these regulations or fail to recruit a sufficient number of patients, we may be required to repeat suchclinical trials, which would delay the regulatory approval process. Our CROs are not our employees, and we are therefore unable to directly monitor whether or not they devote sufficient time and resources to our clinical andnonclinical programs. These CROs may also have relationships with other commercial entities, including parties developing potentially competitiveproducts, for whom they may also be conducting clinical trials or other drug development activities that could harm our competitive position. If our CROs donot successfully carry out their contractual duties or obligations, fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtainis compromised due to the failure to adhere to our clinical protocols or regulatory requirements, or for any other reason, our clinical trials may be extended,delayed or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize our product candidates. As a result, thecommercial prospects for our product candidates would be harmed, our costs could increase, and our ability to generate revenues could be delayed. We also expect to rely on other third parties to store and distribute our product candidates for any clinical trials that we may conduct. Any performancefailure on the part of our distributors could delay clinical development or marketing approval of our product candidates or commercialization of ourproducts, if approved, producing additional losses and depriving us of potential product revenue. Our reliance on third parties requires us to share our trade secrets, which increases the possibility that a competitor will discover them or that our tradesecrets will be misappropriated or disclosed. Because we rely on third parties to manufacture our product candidates, and because we collaborate with various organizations and academic institutions onthe advancement of our technology, we must, at times, share trade secrets with them. We seek to protect our proprietary technology in part by entering intoconfidentiality agreements and, if applicable, material transfer agreements, collaborative research agreements, consulting agreements or other similaragreements with our collaborators, advisors, employees and consultants prior to beginning research or disclosing proprietary information. These agreementstypically limit the rights of the third parties to use or disclose our confidential information, such as trade secrets. Despite these contractual provisions, theneed to share trade secrets and other confidential information increases the risk that such trade secrets become known by potential competitors, areinadvertently incorporated into the technology of others, or are disclosed or used in violation of these agreements. Given that our proprietary position isbased, in part, on our know-how and trade secrets, discovery by a third party of our trade secrets or other unauthorized use or disclosure would impair ourintellectual property rights and protections in our product candidates. In addition, these agreements typically restrict the ability of our collaborators, advisors, employees and consultants to publish data potentially relating to ourtrade secrets. Our academic collaborators typically have rights to publish data, provided that we are notified in advance and may delay publication for aspecified time in order to secure our intellectual property rights arising from the collaboration. In other cases, publication rights are controlled exclusively byus, although in some cases we may share these rights with other parties. Despite our efforts to protect our trade secrets, our competitors may discover our tradesecrets, either through breach of these agreements, independent development or publication of information including our trade secrets in cases where we donot have proprietary or otherwise protected rights at the time of publication. 20 Table of Contents Risks Related to Commercialization of Our Product Candidates We intend to partially rely on third-party manufacturers to produce commercial quantities of any of our product candidates that receives regulatoryapproval, but we have not entered into binding agreements with any such manufacturers to support commercialization. Additionally, thesemanufacturers do not have experience producing our product candidates at commercial levels and may not achieve the necessary regulatory approvalsor produce our product candidates at the quality, quantities, locations and timing needed to support commercialization. We have not yet secured manufacturing capabilities for commercial quantities of our product candidates to support commercialization of our productcandidates. Although we intend to partially rely on third-party manufacturers for commercialization, we have only entered into agreements with suchmanufacturers to assist in the scaling up of the manufacturing process of VB-111. We may be unable to negotiate binding agreements with the manufacturersto support our commercialization activities on commercially reasonable terms, which agreements will further be required to comply with the restrictionsimposed under the Research Law. We may encounter technical or scientific issues related to manufacturing or development that we may be unable to resolve in a timely manner or withavailable funds. Although we have established a site in which we are planning to apply a commercial scale manufacturing, the available capacity tomanufacture our product candidates on a commercial scale is still limited. In addition, our product candidates are novel, and no manufacturer currently hasthe experience or ability to produce our product candidates at commercial levels. If we are unable to produce or engage manufacturing partners to produceour product candidates on a larger scale on reasonable terms, our commercialization efforts will be harmed. Even if we timely complete the development of a manufacturing process and successfully transfer it to the third- party manufacturers of our productcandidates, if we or such third-party manufacturers are unable to produce the necessary quantities of our product candidates, or in compliance with cGMP orwith pertinent regulatory requirements, and within our planned time frame and cost parameters, the development and sales of our product candidates, ifapproved, may be impaired. In addition, any significant disruption in our supplier relationships could harm our business. We source key materials from third parties, either directlythrough agreements with suppliers or indirectly through our manufacturers who have agreements with suppliers. There are a small number of suppliers forcertain key materials that are used to manufacture our product candidates. Such suppliers may not sell these key materials to our manufacturers at the timeswe need them or on commercially reasonable terms. We do not have any control over the process or timing of the acquisition of these key materials by ourmanufacturers. Moreover, we currently do not have any agreements for the commercial production of these key materials. 21 Table of Contents If we are unable to establish sales and marketing capabilities or enter into agreements with third parties to market and sell any of our productcandidates that obtain regulatory approval, we may be unable to generate any revenue. We have no experience selling and marketing our product candidates or any other products. To successfully commercialize any products that may result fromour development programs and obtain regulatory approval, we will need to develop these capabilities, either on our own or with others. We may seek to enterinto collaborations with other entities to utilize their marketing and distribution capabilities, but we may be unable to do so on favorable terms, if at all. Ifany future collaborative partners do not commit sufficient resources to commercialize our future products, if any, and we are unable to develop the necessarymarketing capabilities on our own, we will be unable to generate sufficient product revenue to sustain our business. We will be competing with manycompanies that currently have extensive and well-funded marketing and sales operations. Without an internal team or the support of a third party to performmarketing and sales functions, we may be unable to compete successfully against these more established companies or successfully commercialize any of ourproduct candidates. We face intense competition and rapid technological change and the possibility that our competitors may develop therapies that are more advanced oreffective than ours, which could impair our ability to successfully commercialize our product candidates. We are engaged in pharmaceutical development, which is a rapidly changing field. We have competitors both in the United States and internationally,including major multinational pharmaceutical companies, biotechnology companies and universities and other research institutions. Many of our potential competitors have substantially greater financial, technical and other resources, such as larger research and development staff andexperienced marketing and manufacturing organizations. Competition may increase further as a result of advances in the commercial applicability oftechnologies and greater availability of capital for investment in these industries. Our potential competitors may succeed in developing, acquiring orlicensing on an exclusive basis, products that are more effective or less costly than any product candidate that we may develop, or achieve earlier patentprotection, regulatory approval, product commercialization and market penetration than us. Additionally, technologies developed by others may render ourpotential product candidates uneconomical or obsolete, and we may not be successful in marketing our product candidates against competitors. In particular, VB-111 may face competition from currently approved drugs and drug candidates under development by others to treat rGBM or ovariancancer. In May 2009, the FDA granted accelerated approval to Avastin (bevacizumab), which is an angiogenesis inhibitor, to treat patients with rGBM atprogression after standard first-line therapy. In addition to bevacizumab, a number of companies are conducting late-stage clinical trials to test targeted drugsfocused on angiogenesis inhibition for the treatment of ovarian cancer, including, among others, Amgen’s trebananib, Boehringer Ingelheim’s nintedanib,AstraZeneca’s cediranib and Novartis’s Votrient. The expansion of PARP inhibitors (such as olaparib) for ovarian cancer, and clinical studies evaluating thepotential use of checkpoint inhibitors for ovarian cancer may also affect the prior lines of therapy, or the segment of patient population who will seektreatment with VB-111. 22 Table of Contents Even if we are successful in achieving regulatory approval to commercialize a product candidate faster than our competitors, we may face competition frombiosimilars. In the United States, the Biologics Price Competition and Innovation Act of 2009 created an abbreviated approval pathway for biologicalproducts that are demonstrated to be “highly similar,” or biosimilar, to or “interchangeable” with an FDA-approved biological product. This pathway couldallow competitors to reference data from biological products already approved after 12 years from the time of approval. In Europe, the European Commissionhas granted marketing authorizations for several biosimilars pursuant to a set of general and product class-specific guidelines for biosimilar approvals issuedover the past few years. In Europe, a competitor may reference data from biological products already approved, but will not be able to market a biosimilaruntil ten years after the time of approval. This 10-year period will be extended to 11 years if, during the first eight of those 10 years, the marketingauthorization holder obtains an approval for one or more new therapeutic indications that bring significant clinical benefits compared with existingtherapies. In addition, companies may be developing biosimilars in other countries that could compete with our products. If competitors are able to obtainmarketing approval for biosimilars referencing our products, our products may become subject to competition from such biosimilars, with the attendantcompetitive pressure and consequences. Expiration or successful challenge of our applicable patent rights could also trigger competition from other products,assuming any relevant exclusivity period has expired. In addition, although VB-111 has been granted orphan drug status by the FDA and EMA for a specified indication, there are limitations to the exclusivity. Inthe United States, the exclusivity period for orphan drugs is seven years, while pediatric exclusivity adds six months to any existing patents or exclusivityperiods. In Europe, orphan drugs may be able to obtain 10 years of marketing exclusivity and up to an additional two years on the basis of qualifyingpediatric studies. However, orphan exclusivity may be reduced to six years if the drug no longer satisfies the original designation criteria. Additionally, amarketing authorization holder may lose its orphan exclusivity if it consents to a second orphan drug application or cannot supply enough drug. Orphandrug exclusivity also can be lost when a second applicant demonstrates its drug is “clinically superior” to the original orphan drug. Finally, as a result of the expiration or successful challenge of our patent rights, we could face more litigation with respect to the validity or scope of patentsrelating to other parties’ products. The availability of other parties’ products could limit the demand, and the price we are able to charge, for any products thatwe may develop and commercialize. Since some of our product candidates are aimed for rare diseases, loss of exclusivity or competition as described above may be very significant in light of thelimited size of the relevant market. The commercial success of any current or future product candidate, if approved, will depend upon the degree of market acceptance by physicians,patients, third-party payors and others in the medical community. Even if we obtain the requisite regulatory approvals, the commercial success of our product candidates will depend in part on the medical community,patients, and third-party payors accepting our product candidates as medically useful, cost-effective, and safe. Any product that we bring to the market maynot gain market acceptance by physicians, patients, third-party payors and others in the medical community. If these products do not achieve an adequatelevel of acceptance, we may not generate significant product revenue and may not become profitable. The degree of market acceptance of these productcandidates, if approved for commercial sale, will depend on a number of factors, including: ●the potential efficacy and potential advantages over alternative treatments; ●the prevalence and severity of any side effects, including any limitations or warnings contained in a product’s approved labeling; ●the prevalence and severity of any side effects resulting from the procedure by which our product candidates are administered; ●relative convenience and ease of administration; 23 Table of Contents ●the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies; ●the strength of marketing and distribution support and timing of market introduction of competitive products; ●publicity concerning our products or competing products and treatments; and ●sufficient third-party insurance coverage or reimbursement. Even if a potential product displays a favorable efficacy and safety profile in pre-clinical studies and clinical trials, market acceptance of the product will notbe known until after it is launched. Our efforts to educate the medical community and third-party payors on the benefits of the product candidates mayrequire significant resources and may never be successful. Such efforts to educate the marketplace may require more resources than are required byconventional technologies. A variety of risks associated with international operations could hurt our business. If any of our product candidates are approved for commercialization, it is our current intention to market them on a worldwide basis, either alone or incollaboration with others. In addition, we conduct development activities in various jurisdictions throughout the world. We expect that we will be subject toadditional risks related to engaging in international operations, including: ●different regulatory requirements for approval of drugs and biologics in foreign countries; ●reduced protection for intellectual property rights; ●unexpected changes in tariffs, trade barriers and regulatory requirements; ●economic weakness, including inflation, or political instability in particular foreign economies and markets; ●compliance with tax, employment, immigration and labor laws for employees living or traveling abroad; ●foreign currency fluctuations, which could result in increased operating expenses and reduced revenue, and other obligations incident todoing business in another country; ●workforce uncertainty in countries where labor unrest is more common than in the United States and Israel; ●production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and ●business interruptions resulting from geopolitical actions, including war and terrorism, or natural disasters including earthquakes,typhoons, floods and fires. The insurance coverage and reimbursement status of newly approved products is uncertain. Failure to obtain or maintain adequate coverage andreimbursement for any of our product candidates that are approved could limit our ability to market those products and compromise our ability togenerate revenue. The availability of reimbursement by governmental and private payors is essential for most patients to be able to afford expensive treatments. Sales of ourproduct candidates will depend substantially, both in the U.S. and abroad, on the extent to which the costs of our product candidates will be paid by healthmaintenance, managed care, pharmacy benefit and similar healthcare management organizations, or reimbursed by government health administrationauthorities, private health coverage insurers and other third-party payors. If reimbursement is not available, or is available only to limited levels, we may notbe able to successfully commercialize our product candidates. Even if coverage is provided, the approved reimbursement amount may not be high enough toallow us to establish or maintain pricing sufficient to realize a sufficient return on our investment. 24 Table of Contents There is significant uncertainty related to the insurance coverage and reimbursement of newly approved products. In the United States, the principaldecisions about reimbursement for new medicines are typically made by the Centers for Medicare & Medicaid Services, or CMS, an agency within the U.S.Department of Health and Human Services, as CMS decides whether and to what extent a new medicine will be covered and reimbursed under Medicare.Private payors tend to follow CMS to a substantial degree. It is difficult to predict what CMS will decide with respect to reimbursement for fundamentallynovel products such as ours, as there is no body of established practices and precedents for these new products. Reimbursement agencies in Europe may bemore conservative than CMS. For example, a number of cancer drugs have been approved for reimbursement in the United States and have not been approvedfor reimbursement in certain European countries. The intended use of a drug product by a physician can also affect pricing. For example, CMS could initiate a National Coverage Determinationadministrative procedure, by which the agency determines which uses of a therapeutic product would and would not be reimbursable under Medicare. Thisdetermination process can be lengthy, thereby creating a long period during which the future reimbursement for a particular product may be uncertain. Outside the United States, international operations are generally subject to extensive governmental price controls and other market regulations, and webelieve the increasing emphasis on cost-containment initiatives in Europe, Canada, and other countries is likely to put pressure on the pricing and usage ofany of our product candidates that are approved for marketing. In many countries, the prices of medical products are subject to varying price controlmechanisms as part of national health systems. In general, the prices of medicines under such systems are substantially lower than in the United States. Othercountries allow companies to fix their own prices for medicines, but monitor and control company profits. Additional foreign price controls or other changesin pricing regulation could restrict the amount that we are able to charge for our product candidates. Accordingly, in markets outside the United States, thereimbursement for our products may be reduced compared with the United States and may be insufficient to generate commercially reasonable revenue andprofits. Moreover, increasing efforts by governmental and third-party payors, in the United States and abroad, to cap or reduce healthcare costs, resulting inlegislation and reforms such as the Patient Protection and Affordable Care Act of 2010, may cause such organizations to limit both coverage and level ofreimbursement for new products approved and, as a result, they may not cover or provide adequate payment for our product candidates. We expect toexperience pricing pressures in connection with the sale of any of our product candidates, due to the trend toward managed healthcare, the increasinginfluence of health maintenance organizations and additional legislative changes. The downward pressure on healthcare costs in general, particularlyprescription drugs and surgical procedures and other treatments, has become very intense. As a result, increasingly high barriers are being erected to the entryof new products. The prescription for or promotion of off-label uses of our products by physicians could adversely affect our business. Any regulatory approval of our products is limited to those specific diseases and indications for which our products have been deemed safe and effective bythe FDA or similar authorities in other jurisdictions. In addition, any new indication for an approved product also requires regulatory approval. If we producean approved therapeutic product, we will rely on physicians to prescribe and administer it as we have directed and for the indications described on thelabeling. It is not, however, uncommon for physicians to prescribe medication for unapproved, or “off-label,” uses or in a manner that is inconsistent with themanufacturer’s directions. To the extent such off-label uses and departures from our administration directions become pervasive and produce results such asreduced efficacy or other adverse effects, the reputation of our products in the marketplace may suffer. In addition, off-label uses may cause a decline in ourrevenue or potential revenue, to the extent that there is a difference between the prices of our product for different indications. 25 Table of Contents Furthermore, while physicians may choose to prescribe our drugs for off-label uses, our ability to promote the products is limited to those indications that arespecifically approved by the FDA or other regulators. Although regulatory authorities generally do not regulate the behavior of physicians, they do restrictcommunications by companies with respect to off-label use. If our promotional activities fail to comply with these regulations or guidelines, we may besubject to warnings from, or enforcement action by, these authorities. In addition, failure to follow FDA rules and guidelines relating to promotion andadvertising can result in the FDA’s refusal to approve a product, the suspension or withdrawal of an approved product from the market, product recalls, fines,disgorgement of money, operating restrictions, injunctions or criminal prosecution. Due to the small target patient populations for some of our product candidates, we face uncertainty related to pricing and reimbursement for theseproduct candidates. Some of our target patient populations for our initial product candidates are relatively small, as a result of which the pricing and reimbursement of ourproduct candidates, if approved, must be adequate to support commercial infrastructure. If we are unable to obtain adequate levels of reimbursement, ourability to successfully market and sell our product candidates will be adversely affected. Inadequate reimbursement for such services may lead to physicianresistance and adversely affect our ability to market or sell our products. Risks Related to Our Business Operations Our future success depends on our ability to retain key employees, consultants and advisors and to attract, retain and motivate qualified personnel. We are highly dependent on principal members of our executive team listed under “Management” in this report, including Prof. Dror Harats, our chiefexecutive officer, the loss of whose services may adversely impact the achievement of our objectives. While we have entered into employment agreementswith each of our executive officers, any of them could leave our employment at any time, as all of our employees are “at will” employees. Recruiting andretaining other qualified employees, consultants and advisors for our business, including scientific and technical personnel, will also be critical to oursuccess. There is currently a shortage of skilled executives in our industry, which is likely to continue. As a result, competition for skilled personnel is intenseand the turnover rate can be high. We may not be able to attract and retain personnel on acceptable terms given the competition among numerouspharmaceutical and biotechnology companies for individuals with similar skill sets. In addition, failure to succeed in pre-clinical studies or clinical trialsmay make it more challenging to recruit and retain qualified personnel. The inability to recruit or loss of the services of any executive, key employee,consultant or advisor may impede the progress of our research, development and commercialization objectives. Our collaborations with outside scientists and consultants may be subject to restriction and change. We work with medical experts, chemists, biologists and other scientists at academic and other institutions, and consultants who assist us in our research,development and regulatory efforts, including the members of our scientific advisory board. In addition, these scientists and consultants have provided, andwe expect that they will continue to provide, valuable advice regarding our programs and regulatory approval processes. These scientists and consultants arenot our employees and may have other commitments that would limit their future availability to us. If a conflict of interest arises between their work for usand their work for another entity, we may lose their services. In addition, we are limited in our ability to prevent them from establishing competing businessesor developing competing products. For example, if a key scientist acting as a principal investigator in any of our clinical trials identifies a potential productor compound that is more scientifically interesting to his or her professional interests, his or her availability to remain involved in our clinical trials could berestricted or eliminated. 26 Table of Contents We will need to expand our organization and we may experience difficulties in managing this growth, which could disrupt our operations. As of March 1, 2018, we had 37 employees. As we mature and undertake the activities required to advance our product candidates into later stage clinicaldevelopment and to operate as a public company, we expect to expand our full-time employee base and to hire more consultants and contractors. Ourmanagement may need to divert a disproportionate amount of its attention away from our day-to-day activities and devote a substantial amount of time tomanaging these growth activities. We may not be able to effectively manage the expansion of our operations, which may result in weaknesses in ourinfrastructure, operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. Our expectedgrowth could require significant capital expenditures and may divert financial resources from other projects, such as the development of additional productcandidates. If our management is unable to effectively manage our growth, our expenses may increase more than expected, our ability to generate or growrevenue could be compromised, and we may not be able to implement our business strategy. Our future financial performance and our ability tocommercialize product candidates and compete effectively will depend, in part, on our ability to effectively manage any future growth. Our employees, principal investigators, consultants and commercial partners may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and insider trading. We are exposed to the risk of fraud or other misconduct by our employees, principal investigators, consultants and commercial partners. Misconduct by theseparties could include intentional failures to comply with the regulations of the FDA and non-U.S. regulators, provide accurate information to the FDA andnon-U.S. regulators, comply with healthcare fraud and abuse laws and regulations in the United States and abroad, report financial information or dataaccurately or disclose unauthorized activities to us. In particular, sales, marketing and business arrangements in the healthcare industry are subject toextensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations mayrestrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other businessarrangements. Such misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatorysanctions and cause serious harm to our reputation. We have adopted a code of conduct applicable to all of our employees, but it is not always possible toidentify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown orunmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with these lawsor regulations. If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have asignificant impact on our business, including the imposition of significant fines or other sanctions. We face potential product liability, and, if successful claims are brought against us, we may incur substantial liability and costs. If the use of our productcandidates harms patients, or is perceived to harm patients even when such harm is unrelated to our product candidates, our regulatory approvalscould be revoked or otherwise negatively impacted and we could be subject to costly and damaging product liability claims. The use of our product candidates in clinical trials and the sale of any products for which we obtain marketing approval exposes us to the risk of productliability claims. Product liability claims might be brought against us by consumers, healthcare providers, pharmaceutical companies or others selling orotherwise coming into contact with our product candidates. There is a risk that our product candidates may induce adverse events. If we cannot successfullydefend against product liability claims, we could incur substantial liability and costs. In addition, regardless of merit or eventual outcome, product liabilityclaims may result in: ●impairment of our business reputation; ●withdrawal of clinical trial participants; ●costs due to related litigation; ●distraction of management’s attention from our primary business; 27 Table of Contents ●substantial monetary awards to patients or other claimants; ●the inability to commercialize our product candidates; ●decreased demand for our product candidates, if approved for commercial sale; and ●impairment of our ability to obtain product liability insurance coverage. We carry combined public and products liability (including human clinical trials extension) insurance of $5.0 million per occurrence and $5.0 millionaggregate limit, with extension to $10.0 for the Phase 3 study in rGBM and for the Phase 3 study in ovarian cancer. We believe our product liabilityinsurance coverage is sufficient in light of our current clinical programs; however, we may not be able to maintain insurance coverage at a reasonable cost orin sufficient amounts to protect us against losses due to liability. If we obtain marketing approval for any product candidates, we intend to expand ourinsurance coverage to include the sale of commercial products, but we may not be able to obtain product liability insurance on commercially reasonableterms or in adequate amounts. On occasion, large judgments have been awarded in class action lawsuits based on drugs or medical treatments that hadunanticipated adverse effects. A successful product liability claim or series of claims brought against us could cause our share price to decline and, ifjudgments exceed our insurance coverage, could materially and adversely affect our financial position. Patients with the diseases targeted by some of our product candidates are often already in severe and advanced stages of disease and have both known andunknown significant pre- existing and potentially life-threatening health risks. During the course of treatment, patients may suffer adverse events, includingdeath, for reasons that may be related to our product candidates. Such events could subject us to costly litigation, require us to pay substantial amounts ofmoney to injured patients, delay, negatively impact or end our opportunity to receive or maintain regulatory approval to market our products, or require us tosuspend or abandon our commercialization efforts. Even in a circumstance in which we do not believe that an adverse event is related to our productcandidate, the investigation into the circumstance may be time-consuming or inconclusive. These investigations may harm our reputation, delay ourregulatory approval process, limit the type of regulatory approvals our product candidates receive or maintain, and compromise the market acceptance of anyof our product candidates that receive regulatory approval. As a result of these factors, a product liability claim, even if successfully defended, could hurt ourbusiness and impair our ability to generate revenue. If our existing or future manufacturing facility is damaged or destroyed, or production at any of those facilities is otherwise interrupted, our businessand prospects would be negatively affected. We have a manufacturing facility for commercial scale production. If our existing or future manufacturing facilities, or the equipment in it, is damaged ordestroyed, we likely would not be able to quickly or inexpensively replace our manufacturing capacity and possibly would not be able to replace it at all.Any new facility needed to replace our existing or future manufacturing facility would need to comply with the necessary regulatory requirements, and betailored to our manufacturing requirements and processes. We would need FDA approval before using any product candidates manufactured at a new facilityin clinical trials or selling any products that are ultimately approved. Such an event could delay our clinical trials or, if any of our product candidates areapproved by the FDA, reduce or eliminate our product sales. If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that couldhave a material adverse effect on the success of our business. We are subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use,storage, treatment and disposal of hazardous materials and wastes. Our operations involve the use of hazardous and flammable materials, including chemicalsand biological materials. Our operations also produce hazardous waste products. We generally contract with third parties for the disposal of these materialsand wastes. We cannot eliminate the risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use ofhazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costsassociated with civil or criminal fines and penalties. 28 Table of Contents Although we maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from theuse of hazardous materials or other work-related injuries, this insurance may not provide adequate coverage against potential liabilities. In addition, we mayincur substantial costs in order to comply with current or future environmental, health and safety laws and regulations. These current or future laws andregulations may impair our research, development or production efforts. Failure to comply with these laws and regulations also may result in substantial fines,penalties or other sanctions. If our shipping capabilities become unavailable due to an accident, an act of terrorism, a labor strike or other similar event, our supply, production anddistribution processes could be disrupted. Some of our raw materials for the manufacturing of VB-111, and VB-111 itself, must be transported at a temperature controlled cold chain at temperaturesvarying between -4 degrees Celsius to -70 degrees Celsius (25 to -94 degrees Fahrenheit) to ensure their quality and vitality. Not all shipping or distributionchannels are equipped to transport at these temperatures. If any of our shipping or distribution channels become inaccessible because of a serious accident, anact of terrorism, a labor strike or other similar event, we may experience disruptions in our continued supply of raw materials, delays in our productionprocess or a reduction in our ability to distribute our therapeutics to our customers. We may use our financial and human resources to pursue a particular research program or product candidate and fail to capitalize on programs orproduct candidates that may be more profitable or for which there is a greater likelihood of success. Because we have limited resources, we may forego or delay pursuit of opportunities with certain programs or product candidates or for indications that laterprove to have greater commercial potential. Our resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitablemarket opportunities. Our spending on current and future research and development programs for product candidates may not yield any commercially viableproducts. If we do not accurately evaluate the commercial potential or target market for a particular product candidate, we may relinquish valuable rights tothat product candidate through strategic collaboration, licensing or other royalty arrangements in cases in which it would have been more advantageous forus to retain sole development and commercialization rights to such product candidate, or we may allocate internal resources to a product candidate in atherapeutic area in which it would have been more advantageous to enter into a collaboration arrangement. We will continue to incur significant increased costs as a result of operating as a public company, and our management will continue to be required todevote substantial time to new compliance initiatives. As a public company, we will continue to incur significant legal, accounting and other expenses. In addition, the Sarbanes-Oxley Act, as well as rulessubsequently implemented by the Securities and Exchange Commission, or SEC, and The NASDAQ Global Market have imposed various requirements onpublic companies. Recent legislation permits smaller “emerging growth companies” to implement many of these requirements over a longer period and up tofive years from the pricing of our offering. We intend to take advantage of this new legislation but cannot guarantee that we will not be required to implementthese requirements sooner than budgeted or planned and thereby incur unexpected expenses. Shareholder activism, the current political environment and thecurrent high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead toadditional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate. Our management and otherpersonnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations will increase our legal andfinancial compliance costs and will make some activities more time-consuming and costly. For example, we expect these rules and regulations to make itmore difficult and more expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain ourcurrent levels of such coverage. While compliance with these additional requirements will result in increased costs to us, we cannot accurately predict orestimate at this time the amount of additional costs we may incur as a public company under both U.S. and Israeli laws. 29 Table of Contents We are subject to foreign currency exchange risk, and fluctuations between the U.S. dollar and the NIS, the Euro and other non-U.S. currencies maynegatively affect our earnings and results of operations. We operate in a number of different currencies. While the dollar is our functional and reporting currency and investments in our share capital have beendenominated in dollars, our financial results may be adversely affected by fluctuations in currency exchange rates as a significant portion of our operatingexpenses, including our salary-related and manufacturing expenses are denominated in the NIS, and a significant portion of our clinical trials andmanufacturing expenses are denominated in euros. We are exposed to the risks that the NIS may appreciate relative to the dollar, or, if the NIS instead devalues relative to the dollar, that the inflation rate inIsrael may exceed such rate of devaluation of the NIS, or that the timing of such devaluation may lag behind inflation in Israel. In any such event, the dollarcost of our operations in Israel would increase and our dollar- denominated results of operations would be adversely affected. We cannot predict any futuretrends in the rate of inflation in Israel or the rate of devaluation (if any) of the NIS against the dollar. For example, the average exchange rate of the dollaragainst the NIS decreased in 2017 and in 2016 and increased in 2015. Market volatility and currency fluctuations may limit our ability to cost- effectivelyhedge against our foreign currency exposure and, in addition, our ability to hedge our exposure to currency fluctuations in certain emerging markets may belimited. Hedging strategies may not eliminate our exposure to foreign exchange rate fluctuations and may involve costs and risks of their own, such asdevotion of management time, external costs to implement the strategies and potential accounting implications. Foreign currency fluctuations, independentof the performance of our underlying business, could lead to materially adverse results or could lead to positive results that are not repeated in future periods. Risks Related to Our Intellectual Property We depend on our license agreement with Crucell and if we cannot meet requirements under such license agreement, we could lose the rights to ourproducts, which could have a material adverse effect on our business. VB-111 incorporates an adenoviral vector as the delivery vehicle based on our rights under a license agreement with Crucell. If we fail to meet ourobligations under this license agreement, including various diligence, milestone payment, royalty and other obligations, Crucell has the right to terminateour license, and upon the effective date of such termination, our right to use the licensed technology would terminate. We may enter into additionalagreements in the future with Crucell that may impose similar obligations on us. While we would expect to exercise all rights and remedies available to us,including attempting to cure any breach by us, and otherwise seek to preserve our rights under the patents and other technology licensed to us, we may not beable to do so in a timely manner, at an acceptable cost or at all. Any uncured, material breach under the license agreement could result in our loss of rightsand may lead to a complete termination of our product development and any commercialization efforts for the applicable product candidates since there arecurrently no significant similar alternatives on the market. 30 Table of Contents If we are unable to obtain or protect intellectual property rights related to our product candidates, we may not be able to obtain exclusivity for ourproduct candidates or prevent others from developing similar competitive products. We rely upon a combination of patents, trade secret protection and confidentiality agreements to protect the intellectual property related to our productcandidates. The strength of patents in the biotechnology and pharmaceutical field involves complex legal and scientific questions and can be uncertain. Thepatent applications that we own or in-license may fail to result in issued patents with claims that cover our product candidates in the United States or in otherforeign countries. There is no assurance that all of the potentially relevant prior art relating to our patents and patent applications has been found, which caninvalidate a patent or prevent a patent from issuing from a pending patent application. Even if patents do successfully issue and even if such patents coverour product candidates, third parties may challenge their validity, enforceability or scope, which may result in the patent claims being narrowed orinvalidated. Furthermore, even if they are unchallenged, our patents and patent applications may not adequately protect our intellectual property, provideexclusivity for our product candidates or prevent others from designing around our claims. Any of these outcomes could impair our ability to preventcompetition from third parties. If the patent applications we hold or have in-licensed with respect to our programs or product candidates fail to issue, if the breadth or strength of our patentprotection is threatened, or if our patent portfolio fails to provide meaningful exclusivity for our product candidates, it could dissuade companies fromcollaborating with us to develop product candidates and threaten our ability to commercialize future products. Several patent applications covering ourproduct candidates have been filed recently. We cannot offer any assurances about which, if any, applications will issue as patents, the breadth of any suchissued patent claims or whether any issued claims will be found invalid and unenforceable or will be threatened by third parties. Any successful opposition tothese patents or any other patents owned by or licensed to us could deprive us of rights necessary for the successful commercialization of any productcandidates that we may develop. Further, if we encounter delays in regulatory approvals, the period of time during which we could market a productcandidate under patent protection could be reduced. Since patent applications in the United States and most other countries are confidential for a period oftime after filing, and some remain so until issued, we cannot be certain that we or our licensors were the first to file any patent application related to a productcandidate. Furthermore, if third parties have filed such patent applications, an interference proceeding in the United States can be initiated by a third party todetermine who was the first to invent any of the subject matter covered by the patent claims of our applications. In addition, patents have a limited lifespan.In the United States, the natural expiration of a patent is generally 20 years after it is filed. Various extensions may be available, but the life of a patent, andthe protection it affords, is limited. Even if patents covering our product candidates are obtained, once the patent life has expired for a product, we may beopen to competition from generic medications. This risk is material in light of the length of the development process of our products and lifespan of ourcurrent patent portfolio. In addition to the protection afforded by patents, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that isnot patentable or that we elect not to patent, processes for which patents are difficult to enforce and any other elements of our product candidate discoveryand development processes that involve proprietary know- how, information or technology that is not covered by patents. However, trade secrets can bedifficult to protect. We seek to protect our proprietary technology and processes, in part, by entering into confidentiality agreements with our employees,consultants, scientific advisors and contractors. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintainingphysical security of our premises and physical and electronic security of our information technology systems. Security measures may be breached, and wemay not have adequate remedies for any breach. In addition, our trade secrets may otherwise become known or be independently discovered by competitors.Although we expect all of our employees and consultants to assign their inventions to us, and all of our employees, consultants, advisors and any thirdparties who have access to our proprietary know-how, information or technology to enter into confidentiality agreements, we cannot provide any assurancesthat all such agreements have been duly executed or that our trade secrets and other confidential proprietary information will not be disclosed or thatcompetitors will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques.Misappropriation or unauthorized disclosure of our trade secrets could impair our competitive position and may have a material adverse effect on ourbusiness. Additionally, if the steps taken to maintain our trade secrets are deemed inadequate, we may have insufficient recourse against third parties formisappropriating the trade secret. In addition, others may independently discover our trade secrets and proprietary information. For example, the FDA, as partof its Transparency Initiative, is currently considering whether to make additional information publicly available on a routine basis, including informationthat we may consider to be trade secrets or other proprietary information, and it is not clear at the present time how the FDA’s disclosure policies may changein the future, if at all. 31 Table of Contents Further, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States. As aresult, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad. If we are unable toprevent material disclosure of the non-patented intellectual property related to our technologies to third parties, and there is no guarantee that we will haveany such enforceable trade secret protection, we may not be able to establish or maintain a competitive advantage in our market. Third-party claims of intellectual property infringement may prevent or delay our development and commercialization efforts. Our commercial success depends in part on our avoiding infringement of the patents and proprietary rights of third parties. There is a substantial amount oflitigation, both within and outside the United States, involving patent and other intellectual property rights in the biotechnology and pharmaceuticalindustries, including patent infringement lawsuits, interferences, oppositions and inter partes review proceedings before the U.S. Patent and Trademark Office,or U.S. PTO, and corresponding foreign patent offices. Numerous U.S. and foreign issued patents and pending patent applications, which are owned by thirdparties, exist in the fields in which we are pursuing development candidates. As the biotechnology and pharmaceutical industries expand and more patentsare issued, the risk increases that our product candidates may be subject to claims of infringement of the patent rights of third parties. Third parties may assert that we are employing their proprietary technology without authorization. There may be third-party patents or patent applicationswith claims to materials, formulations, methods of manufacture or methods for treatment related to the use or manufacture of our product candidates. Becausepatent applications can take many years to issue, there may be currently pending patent applications which may later result in issued patents that our productcandidates may be accused of infringing. In addition, third parties may obtain patents in the future and claim that use of our technologies infringes uponthese patents. If any third-party patents were held by a court of competent jurisdiction to cover the manufacturing process of any of our product candidates,any molecules formed during the manufacturing process or any final product itself, the holders of any such patents may be able to block our ability tocommercialize such product candidate unless we obtained a license under the applicable patents, or until such patents expire. Similarly, if any third-partypatents were held by a court of competent jurisdiction to cover aspects of our formulations, processes for manufacture or methods of use, the holders of anysuch patents may be able to block our ability to develop and commercialize the applicable product candidate unless we obtained a license or until suchpatent expires. In either case, such a license may not be available on commercially reasonable terms or at all. Parties making claims against us may obtain injunctive or other equitable relief, which could effectively block our ability to further develop andcommercialize one or more of our product candidates. Defense of these claims, regardless of their merit, would involve substantial litigation expense andwould be a substantial diversion of employee resources from our business. In the event of a successful claim of infringement against us, we may have to paysubstantial damages, including treble damages and attorneys’ fees for willful infringement, pay royalties, redesign our infringing products or obtain one ormore licenses from third parties, which may be impossible or require substantial time and monetary expenditure. We may not be successful in obtaining or maintaining necessary rights to pharmaceutical product components and processes for our developmentpipeline through acquisitions and in- licenses. Presently we have rights to the intellectual property, through licenses from Crucell and under patents that we own, to develop our product candidates.Because our programs may involve additional product candidates that may require the use of proprietary rights held by third parties, the growth of ourbusiness may depend in part on our ability to acquire, in-license or use these proprietary rights. In addition, our product candidates may require specificformulations to work effectively and efficiently and these rights may be held by others. We may be unable to acquire or in-license any compositions, methodsof use, processes or other third- party intellectual property rights from third parties that we identify. The licensing and acquisition of third-party intellectualproperty rights is a competitive area, and a number of more established companies are also pursuing strategies to license or acquire third-party intellectualproperty rights that we may consider attractive. These established companies may have a competitive advantage over us due to their size, cash resources andgreater clinical development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign orlicense rights to us. We also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to make an appropriatereturn on our investment. 32 Table of Contents We may enter into license agreements with third parties, and if we fail to comply with our obligations in such agreements under which we licenseintellectual property rights from third parties or otherwise experience disruptions to our business relationships with our licensors, we could lose licenserights that are important to our business. We may need to obtain licenses from third parties to advance our research or allow commercialization of our product candidates, and we have done so fromtime to time. We may fail to obtain any of these licenses at a reasonable cost or on reasonable terms, if at all. In that event, we may be required to expendsignificant time and resources to develop or license replacement technology. If we are unable to do so, we may be unable to develop or commercialize theaffected product candidates. In many cases, patent prosecution of our in-licensed technology is controlled solely by the licensor. If our licensors fail to obtain and maintain patent or otherprotection for the proprietary intellectual property we license from them, we could lose our rights to the intellectual property or our exclusivity with respectto those rights, and our competitors could market competing products using the intellectual property. In some cases, we control the prosecution of patentsresulting from licensed technology. In the event we breach any of our obligations related to such prosecution, we may incur significant liability to ourlicensing partners. Licensing of intellectual property is of critical importance to our business and involves complex legal, business and scientific issues and iscomplicated by the rapid pace of scientific discovery in our industry. Disputes may arise regarding intellectual property subject to a licensing agreement,including: ●the scope of rights granted under the license agreement and other interpretation-related issues; ●the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensingagreement; ●the sublicensing of patent and other rights under any collaboration relationships we might enter into in the future; ●our diligence obligations under the license agreement and what activities satisfy those diligence obligations; ●the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and us and ourpartners; and ●the priority of invention of patented technology. If disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms,we may be unable to successfully develop and commercialize the affected product candidates. We may be involved in lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time-consuming andunsuccessful. Competitors may infringe our patents or the patents of our licensors. To counter infringement or unauthorized use, we may be required to file infringementclaims, which can be expensive and time-consuming. In addition, in an infringement proceeding, a court may decide that a patent of ours or our licensors isnot valid, is unenforceable or is not infringed, or may refuse to stop the other party from using the technology at issue on the grounds that our patents do notcover the technology in question. An adverse result in any litigation or defense proceedings could put one or more of our patents at risk of being invalidatedor interpreted narrowly and could put our patent applications at risk of not issuing. 33 Table of Contents Interference proceedings provoked by third parties or brought by us may be necessary to determine the priority of inventions with respect to our patents orpatent applications or those of our licensors. An unfavorable outcome could require us to cease using the related technology or to attempt to license rights toit from the prevailing party. Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms. Our defense oflitigation or interference proceedings may fail and, even if successful, may result in substantial costs and distract our management and other employees. Wemay not be able to prevent, alone or with our licensors, misappropriation of our intellectual property rights, particularly in countries where the laws may notprotect those rights as fully as in the United States. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of ourconfidential information could be compromised by disclosure during this type of litigation. There could also be public announcements of the results ofhearings, motions or other interim proceedings or developments. If securities analysts or investors perceive these results to be negative, it could have amaterial adverse effect on the trading price of our ordinary shares. Recent patent reform legislation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcementor defense of our issued patents. Patent reform legislation (the Leahy-Smith Act) enacted in 2013 continues to increase the uncertainties and costs surrounding the prosecution of our patentapplications and the enforcement or defense of our issued patents. The Leahy-Smith Act introduced a number of significant changes to U.S. patent law,including provisions that affect the way patent applications are prosecuted and patent litigation is conducted. The U.S. PTO continues to develop regulationsand procedures to govern administration of the Leahy-Smith Act, and many of the substantive changes to patent law associated with the Act, in particular, theInter Partes Review (IPR) proceedings. It remains to be seen what impact the Leahy-Smith Act will have on the operation of our business. However, the Actand its implementation increases the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of ourissued patents, all of which could have a material adverse effect on our business and financial condition. We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information ofthird parties or that our employees have wrongfully used or disclosed alleged trade secrets of their former employers. Certain of our key employees and personnel are or were previously employed at universities, medical institutions or other biotechnology or pharmaceuticalcompanies, including our competitors or potential competitors. Although we try to ensure that our employees, consultants and independent contractors do not use the proprietary information or know-how of others in theirwork for us, we may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosedintellectual property, including trade secrets or other proprietary information, of any of our employee’s former employer or other third parties. Litigation maybe necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuableintellectual property rights or personnel. Even if we are successful in defending against such claims, litigation could result in substantial costs and be adistraction to management and other employees. Furthermore, universities or medical institutions who employ some of our key employees and personnel inparallel to their engagement by us may claim that intellectual property developed by such person is owned by the respective academic or medical institutionunder the respective institution intellectual property policy or applicable law. 34 Table of Contents We may become subject to claims for remuneration or royalties for assigned service invention rights by our employees, which could result in litigationand adversely affect our business. A significant portion of our intellectual property has been developed by our employees in the course of their employment for us. Under the Israeli Patent Law,5727-1967, or the Patent Law, inventions conceived by an employee during the term and as part of the scope of his or her employment with a company areregarded as “service inventions,” which belong to the employer, absent a specific agreement between the employee and employer giving the employeeservice invention rights. The Patent Law also provides that if there is no such agreement between an employer and an employee, the Israeli Compensationand Royalties Committee, or the Committee, a body constituted under the Patent Law, shall determine whether the employee is entitled to remuneration forhis inventions. Recent decisions by the Committee (which have been upheld by the Israeli Supreme Court on appeal) have created uncertainty in this area, asit held that employees may be entitled to remuneration for their service inventions despite having specifically waived any such rights. Further, theCommittee has not yet determined the method for calculating this remuneration nor the criteria or circumstances under which an employee’s waiver of hisright to remuneration will be disregarded. We generally enter into assignment-of-invention agreements with our employees pursuant to which suchindividuals assign to us all rights to any inventions created in the scope of their employment or engagement with us. Although our employees have agreed toassign to us service invention rights, we may face claims demanding remuneration in consideration for assigned inventions. As a consequence of such claims,we could be required to pay additional remuneration or royalties to our current or former employees, or be forced to litigate such claims, which couldnegatively affect our business. We may be subject to claims challenging the inventorship or ownership of our patents and other intellectual property. We may be subject to claims that former employees, collaborators or other third parties have an ownership interest in our patents or other intellectualproperty. We may have to in the future, ownership disputes arising, for example, from conflicting obligations of consultants or others who are involved indeveloping our product candidates. Litigation may be necessary to defend against these and other claims challenging inventorship or ownership. If we fail indefending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as exclusive ownership of, orright to use, valuable intellectual property. Such an outcome could have a material adverse effect on our business. Even if we are successful in defendingagainst such claims, litigation could result in substantial costs and be a distraction to management and other employees. Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and otherrequirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with theserequirements. Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and applications will be due to be paid to the U.S. PTOand various governmental patent agencies outside of the United States in several stages over the lifetime of the patents and applications. The U.S. PTO andvarious non-U.S. governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisionsduring the patent application process. There are situations in which non-compliance can result in abandonment or lapse of the patent or patent application,resulting in partial or complete loss of patent rights in the relevant jurisdiction. 35 Table of Contents Issued patents covering our product candidates could be found invalid or unenforceable if challenged in court. If we or one of our licensing partners initiated legal proceedings against a third party to enforce a patent covering one of our product candidates, thedefendant may contend that the patent covering our product candidate is invalid, unenforceable or fails to cover the product candidate or the infringingproduct. In patent litigation in the United States, defendants commonly allege that asserted patent claims are invalid and unenforceable. Grounds for avalidity challenge could be an alleged failure to meet one or more of several statutory requirements, including lack of novelty, obviousness, lack of writtendescription, indefiniteness and non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecutionof the patent withheld relevant information from the U.S. PTO, or made a misleading statement, during prosecution. Third parties may also raise similar claimsbefore administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, post grantreview, and equivalent proceedings in foreign jurisdictions, such as opposition proceedings. Such proceedings could result in revocation, amendments to ourpatent claims or statements being made on the record such that our claims may no longer be construed to cover our product candidates. The outcomefollowing legal assertions of invalidity and unenforceability is unpredictable. With respect to the validity question, for example, we cannot be certain thatthere is no invalidating prior art, of which we and the patent examiner were unaware during prosecution. If a defendant were to prevail on a legal assertion ofinvalidity, unenforceability or non-infringement, we would lose at least part, and perhaps all, of the patent protection on our product candidates. Even ifresolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses, and coulddistract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results ofhearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have asubstantial adverse effect on the market price of our ordinary shares. Such litigation or proceedings could substantially increase our operating losses andreduce the resources available for development activities or any future sales, marketing or distribution activities. Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect our products. As is the case with other biotechnology companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcingpatents in the biotechnology industry involve both technological and legal complexity, and is therefore is costly, time- consuming and inherently uncertain.In addition, the United States has recently enacted and is currently implementing wide-ranging patent reform legislation. Recent U.S. Supreme Court rulingshave narrowed the scope of patent protection available in certain circumstances and weakened the rights of patent owners in some situations. In addition toincreasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value ofpatents, once obtained. Depending on decisions by the U.S. Congress, the federal courts, and the U.S. PTO, the laws and regulations governing patents couldchange in unpredictable ways that would weaken our ability to obtain new patents or to enforce our existing patents and patents that we might obtain in thefuture. We have not yet registered trademarks for a commercial trade name for our product candidates and failure to secure such registrations couldadversely affect our business. We have not yet registered trademarks for a commercial trade name for our product candidates. During trademark registration proceedings, we may receiverejections. Although we would be given an opportunity to respond to those rejections, we may be unable to overcome such rejections. In addition, in the U.S.PTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and to seekto cancel registered trademarks. Opposition or cancellation proceedings may be filed against our trademarks, and our trademarks may not survive suchproceedings. Moreover, any name we propose to use with our product candidates in the United States must be approved by the FDA, regardless of whether wehave registered it, or applied to register it, as a trademark. The FDA typically conducts a review of proposed product names, including an evaluation ofpotential for confusion with other product names. If the FDA objects to any of our proposed proprietary product names, we may be required to expendsignificant additional resources in an effort to identify a suitable substitute name that would qualify under applicable trademark laws, not infringe theexisting rights of third parties and be acceptable to the FDA. 36 Table of Contents We may not be able to protect our intellectual property rights throughout the world. Filing, prosecuting and defending patents on product candidates in all countries throughout the world would be prohibitively expensive, and our intellectualproperty rights in some countries outside the United States can be less extensive than those in the United States. In addition, the laws of some foreigncountries do not protect intellectual property rights to the same extent as federal and state laws in the United States. Consequently, we may not be able toprevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using ourinventions in and into the United States or other jurisdictions. Potential competitors may use our technologies in jurisdictions where we have not obtainedpatent protection to develop their own products and further, may export otherwise infringing products to territories where we have patent protection, butenforcement is not as strong as that in the United States. These products may compete with our product candidates, if approved, and our patents or otherintellectual property rights may not be effective or sufficient to prevent them from competing. Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systemsof certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and other intellectual propertyprotection, particularly those relating to biotechnology products, which could make it difficult for us to stop the infringement of our patents or marketing ofcompeting products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result insubstantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpretednarrowly and our patent applications at risk of not issuing and could provoke third parties to assert claims against us. We may not prevail in any lawsuits thatwe initiate and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectualproperty rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. Under applicable employment laws, we may not be able to enforce covenants not to compete. We generally enter into non-competition agreements with our employees. These agreements prohibit our employees, if they cease working for us, fromcompeting directly with us or working for our competitors or clients for a limited period. We may be unable to enforce these agreements under the laws of thejurisdictions in which our employees work and it may be difficult for us to restrict our competitors from benefitting from the expertise our former employeesor consultants developed while working for us. For example, Israeli labor courts have required employers seeking to enforce non-compete undertakings of aformer employee to demonstrate that the competitive activities of the former employee will harm one of a limited number of material interests of the employerwhich have been recognized by the courts, such as the protection of a company’s trade secrets or other intellectual property. Risks Related to Ownership of Our Ordinary Shares The market price of our ordinary shares may be highly volatile, and you may not be able to resell your shares at the purchase price. An active trading market for our ordinary shares may not be available. You may not be able to sell your shares quickly or at the market price if trading in ourordinary shares is not active. The market price of our ordinary shares has been and is likely to remain volatile. Our share price could be subject to wide fluctuations in response to a varietyof factors, including the following: ●adverse results or delays in pre-clinical studies or clinical trials, and resulting changes in our clinical development programs; ●reports of adverse events in other similar products or clinical trials of such products; ●inability to obtain additional funding; ●any delay in filing an IND or BLA for any of our product candidates and any adverse development or perceived adverse development withrespect to the FDA’s review of that IND or BLA; 37 Table of Contents ●failure to develop successfully and commercialize our product candidates for the proposed indications and future product candidates forother indications or new candidates; ●failure to maintain our licensing arrangements or enter into strategic collaborations; ●failure by us or our licensors and strategic collaboration partners to prosecute, maintain or enforce our intellectual property rights; ●changes in laws or regulations applicable to future products; ●inability to scale up our manufacturing capabilities (including in Israel), inability to obtain adequate product supply for our productcandidates or the inability to do so at acceptable prices; ●adverse regulatory decisions, including by the IIA under the Research Law; ●introduction of new products, services or technologies by our competitors; ●failure to meet or exceed financial projections we may provide to the public; ●failure to meet or exceed the financial expectations of the investment community; ●the perception of the pharmaceutical industry by the public, legislatures, regulators and the investment community; ●announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors; ●disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patentprotection for our technologies; ●additions or departures of key scientific or management personnel; ●significant lawsuits, including patent or shareholder litigation; ●changes in the market valuations of similar companies; ●sales of our ordinary shares by us or our shareholders in the future; and ●trading volume of our ordinary shares. In addition, companies trading in the stock market in general, and biopharmaceutical companies in particular, have experienced extreme price and volumefluctuations that have often been unrelated or disproportionate to the operating performance of these companies. Broad market and industry factors maynegatively affect the market price of our ordinary shares, regardless of our actual operating performance. There has been limited trading volume for our ordinary shares. Even though our ordinary shares have been listed on the NASDAQ Global Market, there has been limited liquidity in the market for the ordinary shares,which could make it more difficult for holders to sell their ordinary shares. There can be no assurance that an active trading market for our ordinary shares willbe sustained. In addition, the stock market generally has experienced extreme price and volume fluctuations that have often been unrelated ordisproportionate to the operating performance of listed companies. Broad market and industry factors may negatively affect the market price of our ordinaryshares, regardless of our actual operating performance. The market price and liquidity of the market for our ordinary shares that will prevail in the market maybe higher or lower than the price you pay and may be significantly affected by numerous factors, some of which are beyond our control. 38 Table of Contents Our principal shareholders and management own a significant percentage of our shares and will be able to exert significant control over matterssubject to shareholder approval. As of December 31, 2017, our executive officers, directors, five percent shareholders and their affiliates beneficially owned approximately 47.0% of ourvoting shares. Therefore, these shareholders have the ability to control us through their ownership positions. These shareholders may be able to determine allmatters requiring shareholder approval. For example, these shareholders, if they were to act together, may be able to control elections of directors,amendments of our organizational documents, or approval of any merger, sale of assets, or other major corporate transaction. This may prevent or discourageunsolicited acquisition proposals or offers for our ordinary shares that you may believe are in your best interest as one of our shareholders. We are an “emerging growth company” and a “foreign private issuer,” and we cannot be certain if the reduced reporting requirements applicable toemerging growth companies and foreign private issuers will make our ordinary shares less attractive to investors. We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. For as long as we continue to be anemerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that arenot emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes- Oxley Actof 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in this prospectus and our periodic reports and proxystatements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any goldenparachute payments not previously approved. We could be an emerging growth company for up to five years, although circumstances could cause us to losethat status earlier, including if the market value of our ordinary shares held by non-affiliates exceeds $700.0 million as of any June 30 before that time or ifwe have total annual gross revenue of $1.07 billion or more during any fiscal year before that time, in which cases we would no longer be an emerging growthcompany as of the following December 31 or, if we issue more than $1.0 billion in non-convertible debt during any three-year period before that time, wewould cease to be an emerging growth company immediately. Furthermore, as a foreign private issuer, we are not subject to the same requirements that are imposed upon U.S. domestic issuers by the SEC. Under theSecurities Exchange Act of 1934, or the Exchange Act, we will be subject to reporting obligations that, in certain respects, are less detailed and less frequentthan those of U.S. domestic reporting companies. For example, we will not be required to issue quarterly reports, proxy statements that comply with therequirements applicable to U.S. domestic reporting companies, or individual executive compensation information that is as detailed as that required of U.S.domestic reporting companies. We will also have four months after the end of each fiscal year to file our annual reports with the SEC and will not be requiredto file current reports as frequently or promptly as U.S. domestic reporting companies. Furthermore, our officers, directors and principal shareholders will beexempt from the requirements to report transactions in our equity securities and from the short-swing profit liability provisions contained in Section 16 of theExchange Act. These exemptions and leniencies will reduce the frequency and scope of information and protections to which you may otherwise have beeneligible in relation to a U.S. domestic reporting companies. See “Item 16G. Corporate Governance” for more information. We cannot predict if investors will find our ordinary shares less attractive because we may rely on these reduced requirements. If some investors find ourordinary shares less attractive as a result, there may be a less active trading market for our ordinary shares and our share price may be more volatile. Under the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards apply toprivate companies. We are electing to not take advantage of the extended transition period afforded by the JOBS Act for the implementation of new orrevised accounting standards, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of suchstandards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to not take advantage of the extendedtransition period for complying with new or revised accounting standards is irrevocable. 39 Table of Contents Our ordinary shares are subject to substantial dilution in their book value. As of December 31, 2017, options and warrants to purchase 5,286,095 ordinary shares at a weighted average exercise price of $4.74 per share wereoutstanding. The exercise of any of these options and warrants would result in additional dilution. Sales of a substantial number of our ordinary shares in the public market could cause our share price to fall. If our existing shareholders sell, indicate an intention to sell or the market perceives that they intend to sell, substantial amounts of our ordinary shares in thepublic market, the market price of our ordinary shares could decline significantly. As of December 31, 2017, we had outstanding a total of 29,879,323ordinary shares. Substantially all of the shares are available for sale in the public market. As of December 31, 2017, 12,461,588 ordinary shares are held by directors, executive officers and other affiliates and are subject to Rule 144 under theSecurities Act of 1933, as amended, or the Securities Act. In addition, as of March 1, 2018, an aggregate of 6,693,581 ordinary shares that are either subject to outstanding options, reserved for future issuance underour 2014 Plan or subject to outstanding warrants will or may become eligible for sale in the public market to the extent permitted by the provisions of variousvesting schedules and Rule 144 and Rule 701 under the Securities Act. If these additional ordinary shares are sold, or if it is perceived that they will be sold,in the public market, the market price of our ordinary shares could decline. Future sales and issuances of our ordinary shares or rights to purchase ordinary shares, including pursuant to our equity incentive plans, could result inadditional dilution of the percentage ownership of our shareholders and could cause our share price to fall. Additional capital will be needed in the future to continue our planned operations. To the extent we raise additional capital by issuing equity securities, ourshareholders may experience substantial dilution. We may sell ordinary shares, convertible securities or other equity securities in one or more transactions atprices and in a manner we determine from time to time. If we sell ordinary shares, convertible securities or other equity securities in more than one transaction,investors may be materially diluted by subsequent sales. These sales may also result in material dilution to our existing shareholders, and new investors couldgain rights superior to our existing shareholders. Pursuant to our Employee Share Ownership and Option Plan (2014), or the 2014 Plan, our management is authorized to grant share options and other equity-based awards to our employees, directors and consultants. Currently, we plan to register the increased number of shares available for issuance under the 2014Plan each year. If our board of directors elects to increase the number of shares available for future grant by the maximum amount each year, our shareholdersmay experience additional dilution, which could cause our share price to fall. We could be subject to securities class action litigation. In the past, securities class action litigation has often been brought against a company following a decline in the market price of its securities. This risk isespecially relevant for us because pharmaceutical companies have experienced significant share price volatility in recent years. For example, the price of ourordinary shares, which reached its high record of $17.02 per share at the close of the trading on January 27, 2015, decreased as low as $2.8 per share at theclose of the trading on February 1, 2016 a drop of about 84%. If we face such litigation, it could result in substantial costs and a diversion of management’sattention and resources, which could harm our business. 40 Table of Contents We do not intend to pay dividends on our ordinary shares, so any returns will be limited to the value of our shares. We have never declared or paid any cash dividends on our share capital. We currently anticipate that we will retain future earnings for the development,operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. Any return to shareholderswill therefore be limited to the appreciation of their shares. In addition, Israeli law limits our ability to declare and pay dividends, and may subject ourdividends to Israeli withholding taxes. Furthermore, our payment of dividends (out of tax- exempt income) may retroactively subject us to certain Israelicorporate income taxes, to which we would not otherwise be subject. If equity research analysts do not publish research reports about our business or if they issue unfavorable commentary or downgrade our ordinaryshares, the price of our ordinary shares could decline. The trading market for our ordinary shares relies in part on the research and reports that equity research analysts publish about us and our business. The priceof our ordinary shares could decline if we do not obtain research analyst coverage, or one or more securities analysts downgrade our ordinary shares or ifthose analysts issue other unfavorable commentary or cease publishing reports about us or our business. Risks Related to Our Incorporation and Operations in Israel We are a “foreign private issuer” and intend to follow certain home country corporate governance practices, and our shareholders may not have thesame protections afforded to shareholders of companies that are subject to all NASDAQ corporate governance requirements. As a foreign private issuer, we are permitted, and intend, to follow certain home country corporate governance practices instead of those otherwise requiredunder the NASDAQ Stock Market for domestic U.S. issuers. For instance, we intend to follow home country practice in Israel with regard to the quorumrequirement for shareholder meetings. As permitted under the Israeli Companies Law, 5759-1999, or the Companies Law, our articles of association providethat the quorum for any meeting of shareholders shall be the presence of at least two shareholders present in person, by proxy or by a voting instrument, whohold at least 25% of the voting power of our shares instead of the 33 1/3% of the issued share capital requirement. We may in the future elect to follow homecountry practices in Israel (and consequently avoid the requirements that would otherwise apply to a U.S. company listed on The NASDAQ Global Market)with regard to other matters, as well, such as the formation of compensation, nominating and governance committees, separate executive sessions ofindependent directors and non-management directors and the requirement to obtain shareholder approval for certain dilutive events (such as for theestablishment or amendment of certain equity-based compensation plans, issuances that will result in a change of control of the company, certain transactionsother than a public offering involving issuances of a 20% or more interest in the company and certain acquisitions of the stock or assets of another company).Following our home country governance practices as opposed to the requirements that would otherwise apply to a U.S. company listed on The NASDAQGlobal Market may provide less protection to you than what is accorded to investors under the NASDAQ Stock Market rules applicable to domestic U.S.issuers. See “Item 16G. Corporate Governance” for more information. In addition, as a foreign private issuer, we are exempt from the rules and regulations under the Exchange Act related to the furnishing and content of proxystatements, including the requirement for an emerging growth company to disclose the compensation of the chief executive officer and other two highestcompensated executive officers on an individual, rather than aggregate, basis. A recent amendment to regulations under the Israeli Companies Law requiresus to disclose in the notice for our annual meeting of shareholders, the annual compensation of our five most highly compensated officers on an individual,rather than aggregate, basis. However, this disclosure is not as extensive as that required of a U.S. domestic issuer. 41 Table of Contents We would lose our foreign private issuer status if a majority of our directors or executive officers are U.S. citizens or residents and we fail to meet additionalrequirements necessary to avoid loss of foreign private issuer status. Although we have elected to comply with certain U.S. regulatory provisions, our loss offoreign private issuer status would make such provisions mandatory. The regulatory and compliance costs to us under U.S. securities laws as a U.S. domesticreporting company may be significantly higher. If we are not a foreign private issuer, we will be required to file periodic reports and registration statements onU.S. domestic reporting company forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer. We may alsobe required to modify certain of our policies to comply with accepted governance practices associated with U.S. domestic reporting companies. Suchconversion and modifications will involve additional costs. In addition, we may lose our ability to rely upon exemptions from certain corporate governancerequirements on U.S. stock exchanges that are available to foreign private issuers. Potential political, economic and military instability in the State of Israel, where the majority of our senior management and our research anddevelopment facilities are located, may adversely affect our results of operations. We are incorporated under Israeli law and our offices and operations are located in the State of Israel. In addition, our key employees, officers and all but twoof our directors are residents of Israel. Accordingly, political, economic and military conditions in Israel directly affect our business. Since the State of Israelwas established in 1948, a number of armed conflicts have occurred between Israel and its neighboring countries. Any hostilities involving Israel or the interruption or curtailment of trade between Israel and its present trading partners, or a significant downturn in theeconomic or financial condition of Israel, could affect adversely our operations. Since October 2000, there have been increasing occurrences of terroristviolence. Ongoing and revived hostilities or other Israeli political or economic factors could harm our operations, product development and results ofoperations. Although Israel has entered into various agreements with Egypt, Jordan and the Palestinian Authority, there has been an increase in unrest and terroristactivity, which began in October 2000 and has continued with varying levels of severity. The establishment in 2006 of a government in the PalestinianAuthority by representatives of the Hamas militant group has created additional unrest and uncertainty in the region. In 2006, a conflict between Israel andthe Hezbollah in Lebanon resulted in thousands of rockets being fired from Lebanon up to 50 miles into Israel. Starting in December 2008, for approximatelythree weeks, Israel engaged in an armed conflict with Hamas in the Gaza Strip, which involved missile strikes against civilian targets in various parts of Israeland negatively affected business conditions in Israel. In November 2012, for approximately one week, Israel experienced a similar armed conflict, resulting inhundreds of rockets being fired from the Gaza Strip and disrupting most day-to-day civilian activity in southern Israel. Beginning in July 2014, forapproximately seven weeks, Israel experienced additional armed conflict between Israel and Hamas, which included rocket strikes against civilian targets invarious parts of Israel. If renewed, these hostilities may negatively affect business conditions in Israel. In addition, Israel faces threats from more distantneighbors, in particular, Iran. Our insurance policies do not cover us for the damages incurred in connection with these conflicts or for any resultingdisruption in our operations. The Israeli government, as a matter of law, provides coverage for the reinstatement value of direct damages that are caused byterrorist attacks or acts of war; however, the government may cease providing such coverage or the coverage might not be enough to cover potential damages.In the event that hostilities disrupt the ongoing operation of our facilities or the airports and seaports on which we depend to import and export our suppliesand products, our operations may be materially adversely affected. In addition, since the end of 2010, numerous acts of protest and civil unrest have taken place in several countries in the Middle East and North Africa, manyof which involved significant violence. The civil unrest in Egypt, which borders Israel, resulted in the resignation of its president Hosni Mubarak, and tosignificant changes to the country’s government. In Syria, also bordering Israel, a civil war is continuing to take place. The ultimate effect of thesedevelopments on the political and security situation in the Middle East and on Israel’s position within the region is not clear at this time. Such instabilitymay lead to deterioration in the political and trade relationships that exist between the State of Israel and certain other countries. 42 Table of Contents Popular uprisings in various countries in the Middle East and North Africa are affecting the political stability of those countries. Such instability may lead todeterioration in the political and trade relationships that exist between the State of Israel and these countries. Several countries, principally in the MiddleEast, still restrict doing business with Israel and Israeli companies, and additional countries may impose restrictions on doing business with Israel and Israelicompanies if hostilities in Israel or political instability in the region continues or increases. Any hostilities involving Israel or the interruption or curtailmentof trade between Israel and its present trading partners, or significant downturns in the economic or financial condition of Israel, could adversely affect ouroperations and product development and adversely affect our share price. Similarly, Israeli companies are limited in conducting business with entities fromseveral countries. For instance, in 2008, the Israeli legislature passed a law forbidding any investments in entities that transact business with Iran. Our operations may be disrupted by the obligations of personnel to perform military service. As of March 1, 2018, we had 37 employees, all of whom were based in Israel. Some of our employees may be called upon to perform up to 36 days (and insome cases more) of annual military reserve duty until they reach the age of 40 (and in some cases, up to 45 or older) and, in emergency circumstances, couldbe called to immediate and unlimited active duty. In the event of severe unrest or other conflict, individuals could be required to serve in the military forextended periods of time. Since September 2000, in response to increased tension and hostilities, there have been occasional call-ups of military reservists,including in connection with the 2006 conflict in Lebanon, and the December 2008 and November 2012 conflicts with Hamas, and it is possible that therewill be additional call-ups in the future. Our operations could be disrupted by the absence of a significant number of our employees related to military serviceor the absence for extended periods of one or more of our key employees for military service. Such disruption could materially adversely affect our businessand results of operations. Additionally, the absence of a significant number of the employees of our Israeli suppliers and contractors related to military serviceor the absence for extended periods of one or more of their key employees for military service may disrupt their operations. The tax benefits that are available to us if and when we generate taxable income require us to meet various conditions and may be prevented or reducedin the future, which could increase our costs and taxes. If and when we generate taxable income, we would be eligible for certain tax benefits provided to “Benefited Enterprises” under the Israeli Law for theEncouragement of Capital Investments, 1959, as amended, or the Investment Law. In order to remain eligible for the tax benefits for “Benefited Enterprises”we must continue to meet certain conditions stipulated in the Investment Law and its regulations, as amended. In addition, we informed the Israeli TaxAuthority of our choice of 2012 as a “Benefited Enterprise” election year, all under the Investment Law. The benefits available to us under this tax regulationare subject to the fulfillment of conditions stipulated in the regulation. Further, in the future these tax benefits may be reduced or discontinued. If these taxbenefits are reduced, cancelled or discontinued, our Israeli taxable income would be subject to regular Israeli corporate tax rates. The standard corporate taxrate for Israeli companies is 25% for 2016, 24% for 2017 and 23% for 2018 and thereafter. Additionally, if we increase our activities outside of Israel throughacquisitions, for example, our expanded activities might not be eligible for inclusion in future Israeli tax benefit programs. See “Item 10E. Taxation—IsraeliTax Considerations and Government Programs—Law for the Encouragement of Capital Investments, 5719-1959.” 43 Table of Contents It may be difficult to enforce a U.S. judgment against us, our officers and directors and the Israeli experts named in this prospectus in Israel or theUnited States, or to assert U.S. securities laws claims in Israel or serve process on our officers and directors and these experts. We were incorporated in Israel, and our corporate headquarters and substantially all of our operations are located in Israel. All of our executive officers and allbut two of our directors, and the Israeli experts named in this prospectus, are located in Israel. The majority of our assets and the assets of these persons arelocated outside the United States. Therefore, it may be difficult for an investor, or any other person or entity, to enforce a U.S. court judgment based upon thecivil liability provisions of the U.S. federal securities laws against us or any of these persons in a U.S. or Israeli court, or to effect service of process upon thesepersons in the United States. Additionally, it may be difficult for an investor, or any other person or entity, to assert U.S. securities law claims in originalactions instituted in Israel. Israeli courts may refuse to hear a claim based on an alleged violation of U.S. securities laws against us or our officers and directorson the grounds that Israel is not the most appropriate forum in which to bring such a claim. Even if an Israeli court agrees to hear a claim, it may determinethat Israeli law and not U.S. law is applicable to the claim. If U.S. law is found to be applicable, the content of applicable U.S. law must be proved as a fact,which can be a time-consuming and costly process. Certain matters of procedure will also be governed by Israeli law. There is little binding case law in Israeladdressing the matters described above. Your rights and responsibilities as our shareholder will be governed by Israeli law, which may differ in some respects from the rights andresponsibilities of shareholders of U.S. corporations. Since we are incorporated under Israeli law, the rights and responsibilities of our shareholders are governed by our articles of association and Israeli law.These rights and responsibilities differ in some material respects from the rights and responsibilities of shareholders of U.S. corporations. In particular, ashareholder of an Israeli company has a duty to act in good faith and in a customary manner in exercising its rights and performing its obligations towards thecompany and other shareholders and to refrain from abusing its power in the company, including, among other things, in voting at the general meeting ofshareholders on certain matters, such as an amendment to the company’s articles of association, an increase of the company’s authorized share capital, amerger of the company and approval of related party transactions that require shareholder approval. A shareholder also has a general duty to refrain fromdiscriminating against other shareholders. In addition, a controlling shareholder or a shareholder who knows that it possesses the power to determine theoutcome of a shareholder vote or to appoint or prevent the appointment of an officer of the company has a duty to act in fairness towards the company withregard to such vote or appointment. However, Israeli law does not define the substance of this duty of fairness. There is limited case law available to assist usin understanding the nature of this duty or the implications of these provisions. These provisions may be interpreted to impose additional obligations andliabilities on our shareholders that are not typically imposed on shareholders of U.S. corporations. See “Item 6. Directors, Senior Management and Employees—Approval of Related Party Transactions Under Israeli Law—Shareholders’ Duties.” Provisions of Israeli law and our amended and restated articles of association could make it more difficult for a third party to acquire us or increase thecost of acquiring us, even if doing so would benefit our shareholders. Israeli law regulates mergers, requires tender offers for acquisitions of shares above specified thresholds, requires special approvals for transactions involvingdirectors, officers or significant shareholders and regulates other matters that may be relevant to such types of transactions. For example, a tender offer for allof a company’s issued and outstanding shares can only be completed if the acquirer receives positive responses from the holders of at least 95% of the issuedshare capital. Completion of the tender offer also requires approval of a majority of the offerees that do not have a personal interest in the tender offer, unlessat least 98% of the company’s outstanding shares are tendered. Furthermore, the shareholders, including those who indicated their acceptance of the tenderoffer (unless the acquirer stipulated in its tender offer that a shareholder that accepts the offer may not seek appraisal rights), may, at any time within sixmonths following the completion of the tender offer, petition an Israeli court to alter the consideration for the acquisition. See “Item 10B. Memorandum andArticles of Association—Acquisitions under Israeli Law” for additional information. Further, Israeli tax considerations may make potential transactions undesirable to us or to some of our shareholders whose country of residence does not havea tax treaty with Israel granting tax relief to such shareholders from Israeli tax. For example, Israeli tax law does not recognize tax-free share exchanges to thesame extent as U.S. tax law. With respect to mergers, Israeli tax law allows for tax deferral in certain circumstances but makes the deferral contingent on thefulfillment of a number of conditions, including, in some cases, a holding period of two years from the date of the transaction during which sales anddispositions of shares of the participating companies are subject to certain restrictions. Moreover, with respect to certain share swap transactions, the taxdeferral is limited in time, and when such time expires, the tax becomes payable even if no disposition of the shares has occurred. 44 Table of Contents Certain U.S. shareholders may be subject to adverse tax consequences if we are characterized as “Controlled Foreign Corporation.” Each “Ten Percent Shareholder” in a non-U.S. corporation that is classified as a “controlled foreign corporation,” or a CFC, for U.S. federal income taxpurposes generally is required to include in income for U.S. federal tax purposes such Ten Percent Shareholder’s pro rata share of the CFC’s “Subpart Fincome” and investment of earnings in U.S. property, even if the CFC has made no distributions to its shareholders. A non-U.S. corporation generally will beclassified as a CFC for U.S. federal income tax purposes if Ten Percent Shareholders own, directly or indirectly, more than 50% of either the total combinedvoting power of all classes of stock of such corporation entitled to vote or of the total value of the stock of such corporation. A “Ten Percent Shareholder” is aU.S. person (as defined by the U.S. Internal Revenue Code of 1986, as amended), who owns or is considered to own 10% or more of the total combined votingpower of all classes of stock entitled to vote of such corporation. The determination of CFC status is complex and includes attribution rules, the applicationof which is not entirely certain. We do not believe that we were a CFC for the taxable year ended December 31, 2017 or that we are currently a CFC. It is possible, however, that a shareholdertreated as a U.S. person for U.S. federal income tax purposes will acquire, directly or indirectly, enough shares to be treated as a Ten Percent Shareholder afterapplication of the constructive ownership rules and, together with any other Ten Percent Shareholders of our company, cause us to be treated as a CFC forU.S. federal income tax purposes. We believe that certain of our shareholders are Ten Percent Shareholders for U.S. federal income tax purposes. Holdersshould consult their own tax advisors with respect to the potential adverse U.S. federal income tax consequences of becoming a Ten Percent Shareholder in aCFC. We expect to be classified as a passive foreign investment company in future years, and our U.S. shareholders may suffer adverse tax consequences as aresult. Generally, if, for any taxable year, at least 75% of our gross income is passive income, or at least 50% of the value of our assets is attributable to assets thatproduce passive income or are held for the production of passive income, including cash, we would be characterized as a passive foreign investmentcompany, or PFIC, for U.S. federal income tax purposes. For purposes of these tests, passive income includes dividends, interest, and gains from the sale orexchange of investment property and rents and royalties other than rents and royalties which are received from unrelated parties in connection with the activeconduct of a trade or business. If we are characterized as a PFIC, our U.S. shareholders may suffer adverse tax consequences, including having gains realizedon the sale of our ordinary shares treated as ordinary income, rather than capital gain, the loss of the preferential rate applicable to dividends received on ourordinary shares by individuals who are U.S. holders, and having interest charges apply to distributions by us and the proceeds of share sales. See “Item 10E.Taxation—Certain Material U.S. Federal Income Tax Considerations—Passive Foreign Investment Company Considerations.” Since PFIC status depends on the composition of our income and the composition and value of our assets (which may be determined in large part by referenceto the market value of our ordinary shares, which may be volatile) from time to time, there can be no assurance that we will not be considered a PFIC for anytaxable year. We had no revenue-producing operations until and including table year 2016. We believe that we were not a PFIC for our 2017 taxable year. Inaddition, unless and until we generate sufficient revenue from active licensing and other non-passive sources and otherwise satisfy the asset test above, weexpect to be treated as a PFIC in future taxable years. 45 Table of Contents Item 4. Information on the Company Corporate Information The legal name of our company is Vascular Biogenics Ltd. and we conduct business under the name VBL Therapeutics. We were incorporated in Israel onJanuary 27, 2000 as a company limited by shares under the name Medicard Ltd. In January 2003, we changed our name to Vascular Biogenics Ltd. Ourregistered and principal office is located 8 HaSatat St., Modi’in, Israel 7178106. Our service agent in the United States is located at c/o CT CorporationSystem, 111 8th Avenue, New York, New York 10011 and our telephone number is 972-8-9935000. Throughout this prospectus, we refer to varioustrademarks, service marks and trade names that we use in our business. The “Vascular Biogenics” design logo, “VBL Therapeutics,” “Vascular TargetingSystem,” “VTS,” “Lecinoxoids,” “VB-111,” “VB-201,” the “GLOBE” design logo and other trademarks or service marks of Vascular Biogenics Ltd.appearing in this prospectus are the property of Vascular Biogenics Ltd. We have several other registered trademarks, service marks and pending applicationsrelating to our products. Although we have omitted the “ ® ” and “™” trademark designations for such marks in this prospectus, all rights to such trademarksare nevertheless reserved. Other trademarks and service marks appearing in this prospectus are the property of their respective holders. Emerging Growth Company We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act, or the JOBS Act. Thus, we may take advantage of certainexemptions from various reporting requirements that are applicable to public companies generally. For example, we have elected not to have ourindependent registered public accounting firm provide an attestation report on the effectiveness of our internal control over financial reporting, as wouldotherwise be required by Section 404(b) of the Sarbanes-Oxley Act, or SOX. We will cease to be an “emerging growth company” upon the earliest of: ●December 31, 2019, which is the last day of the fiscal year in which the fifth anniversary of our initial public offering in the United Stateshas occurred; ●the last day of the fiscal year in which our annual gross revenues are $1.07 billion or more; ●the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or ●the last day of any fiscal year in which the market value of our ordinary shares held by non-affiliates exceeded $700.0 million as of the endof the second quarter of that fiscal year. The JOBS Act also provides that an “emerging growth company” can utilize the extended transition period provided in Section 7(a)(2)(B) of the SecuritiesAct, for complying with new or revised accounting standards. However, we have chosen to “opt out” of such extended transition period, and, as a result, wewill comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for companies that are not“emerging growth companies.” Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with newor revised accounting standards is irrevocable. Capital Expenditures For a discussion of our capital expenditures, see “Item 5. Operating and Financial Review and Prospects—Liquidity and Capital Resources.” Business Overview We are a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of first-in-class treatments for cancer. Ourprogram is based on our proprietary Vascular Targeting System, or VTS, platform technology, which utilizes genetically targeted therapy to destroy newlyformed, or angiogenic, blood vessels, and which we believe will allow us to develop product candidates for multiple oncology indications. 46 Table of ContentsOur lead product candidate, VB-111 (ofranergene obadenovec), is a gene-based biologic that we are developing for solid tumor indications, and which wehave advanced to programs for recurrent glioblastoma, or rGBM, an aggressive form of brain cancer, ovarian cancer and thyroid cancer. We have obtained fasttrack designation for VB-111 in the United States for prolongation of survival in patients with glioblastoma that has recurred following treatment withstandard chemotherapy and radiation. We have also received orphan drug designation for GBM in both the United States and Europe. VB-111 has alsoreceived an orphan designation for the treatment of ovarian cancer by the European Medicines Agency. In September 2015, we reported complete resultsfrom our Phase 2 trial of VB-111 in rGBM, demonstrating a statistically-significant benefit in overall survival and favorable response rate in patients treatedwith VB-111 in combination with bevacizumab. Our pivotal Phase 3 GLOBE study in rGBM began in August 2015 and was comparing a combination of VB-111 and bevacizumab to bevacizumab alone. The study, which enrolled a total of 256 patients in the US, Canada and Israel was conducted under a specialprotocol assessment, or SPA, agreement with the U.S. Food and Drug Administration, or FDA, with full endorsement by the Canadian Brain TumorConsortium (CBTC). On March 8, 2018, we announced top-line results from the GLOBE study, which showed that the study did not meet its pre-specifiedprimary endpoint of overall survival (OS). No new safety concerns associated with VB-111 have been identified in the GLOBE study. Once we receive thefull and final data set, we will conduct an in-depth analysis in order to better understand the outcome of the GLOBE study and the potential activity of VB-111 in rGBM. We do not think that results of the GLOBE study in rGBM will necessarily have implications on the prospects for VB-111 in other tumor types.Our OVAL phase 3 potential registration study of VB-111 in platinum resistant ovarian cancer was launched in December 2017 and is conducted incollaboration with the GOG Foundation, Inc., a leading organization for research excellence in the field of gynecologic malignancies. We also have been conducting a program targeting anti-inflammatory diseases, based on the use of our Lecinoxoid platform technology. Lecinoxoids are anovel class of small molecules we developed that are structurally and functionally similar to naturally occurring molecules known to modulate inflammation.The lead product candidate from this program, VB-201, is a Phase 2-ready molecule that demonstrated efficacy in reducing vascular inflammation in a Phase2 sub-study in psoriatic patients with cardiovascular risk. Due to business limitations associated with the heavy burden of developing medications forcardiovascular diseases, we chose to test it in psoriasis and ulcerative colitis; however, as we reported in February 2015, VB-201 failed to meet the primaryendpoint in Phase 2 clinical trials for psoriasis and for ulcerative colitis. As a result, we have terminated our development of VB-201 in those indications.Nevertheless, based on recent pre-clinical studies, we believe that VB-201 and some second generation molecules such as VB-703 may be applicable forNASH and renal fibrosis, and we may seek a clinical proof of concept in NASH patients through an exploratory Phase 2 study for VB-201. Since the companyintends to focus its efforts and resources on advancing our oncology program, we will seek to advance our Lecinoxoid assets via strategic deals. We are also conducting a research program exploring the potential of targeting of MOSPD2 for immuno-oncology applications. In January 2017, we reportedthat targeting of MOSPD2 inhibits chemotaxis of monocytes and neuropils, and that unpublished VBL data also show MOSPD2 expression on certain tumorcells. We believe that targeting of MOSPD2 may have several therapeutic applications, including inhibition of monocyte migration in chronic inflammatoryconditions, inhibition of tumor cell metastases and targeting of MOSPD2-expressing tumor cells. We are developing our “VB-600 series” of pipelinecandidates towards these applications. We are developing our lead oncology product candidate, VB-111, for solid tumor indications, with current clinical programs in rGBM, thyroid cancer andovarian cancer. In interim analyses of data from our ongoing open-label Phase 2 clinical trial of VB-111 in rGBM, we observed dose-dependent attenuationof tumor growth and an increase in median overall survival, which is the time interval from initiation of treatment to the patient’s death. The U.S. Food andDrug Administration, or FDA, has granted VB-111 fast track designation for prolongation of survival in patients with glioblastoma that has recurredfollowing treatment with temozolomide, a chemotherapeutic agent commonly used to treat newly diagnosed glioblastoma, and radiation. On July 1, 2014,the FDA concurred with the design and planned analyses of our Phase 3 pivotal trial of VB-111 in rGBM pursuant to an SPA. At the time, commencement ofthe trial was subject to our providing the agency with more information regarding our potency release assay for the trial. We developed this assay andsubmitted initial information to the FDA on May 26, 2014. On February 5, 2015 the FDA has found our data satisfactory and removed the partial hold. We began our Phase 3 pivotal trial of VB-111 in rGBM in August 2015 and completed patient enrollment for the study in December 2016, five months aheadof our initial plan. Following positive safety reviews announced in December 2016, in April 2017 and the third and final safety review that was announced inOctober 2017, the GLOBE trial continued to completion. On March 8, 2018, we announced top-line results from the GLOBE study, which showed that thestudy did not meet its pre-specified primary endpoint of overall survival (OS). 47 Table of Contents VB-111 was also being studied in a Phase 2 trial for recurrent platinum-resistant Ovarian Cancer and in a Phase 2 study in recurrent, iodine-resistantdifferentiated Thyroid Cancer. In a Phase 2 trial for recurrent platinum-resistant ovarian cancer, VB-111 demonstrated a statistically significant increase inoverall survival and 60% durable response rate (as measured by reduction in CA-125), approximately twice the historical response with bevacizumab pluschemotherapy in ovarian cancer. In December 2016, we had an end-of-Phase-2 meeting with the FDA, in which we received approval from the FDA toadvance VB-111 for a Phase 3 study in platinum-resistant ovarian cancer, which we launched in December 2017. The OVAL study is conducted incollaboration with the Gynecologic Oncology Group (GOG) Foundation, Inc., a leading organization for research excellence in the field of gynecologicmalignancies. In February 2017, we reported full data from our exploratory Phase 2 study of VB-111 in recurrent, iodine-resistant differentiated thyroid cancer. The primaryendpoint of the trial, defined as 6-month progression-free-survival (PFS-6) of 25%, was met with a dose response. Forty-seven percent of patients in thetherapeutic-dose cohort reached PFS-6, versus 25% in the sub-therapeutic cohort, both groups meeting the primary endpoint. An overall survival benefit wasseen, with a tail of more than 40% at 3.7 years for the therapeutic-dose cohort, similar to historical data for pazopanib (Votrient ®), a tyrosine kinase inhibitor;however, most patients in the VB-111 study had tumors that previously had progressed on pazopanib or other kinase inhibitors. As of December 31, 2016, wehad studied VB-111 in over 200 patients and have observed it to be well-tolerated. In December 2015, we have been granted a US composition of matterpatents that provides intellectual property protection for VB-111 in the US until October 2033 before any patent term extension. In June 2017, at the BIO international conference we provided an update on the long-term status and survival of patients from three completed Phase 2 trialswith VB-111. In the Phase 2 study in rGBM patients, 12-month survival was 54% in patients who were treated with VB-111 through progression, including arGBM patient who remains alive with complete response after >50 months, compared to 23% of patients who had limited exposure of a therapeutic dose ofVB-111. According to a meta-analysis, the 12-month survival on Avastin (bevacizumab) is only 24%. In the Phase 2 study in recurrent platinum-resistant andrefractory ovarian cancer, 53% of patients treated with a therapeutic dose of VB-111 in combination with paclitaxel were alive at 15 months. No patients inthe sub-therapeutic dose were alive at the 15-month time point. In the Phase 2 study in radioiodine refractory differentiated thyroid cancer, 53% of those whoreceived multiple therapeutic doses of VB-111 were alive at 24 months, compared to 33% of those who received a single, sub-therapeutic dose of VB-111. In October 2017, we announced the opening of our new gene therapy manufacturing plant in Modiin, Israel. This plant can be the commercial facility forproduction of VB-111, if approved. The Modiin facility is the first commercial-scale gene therapy manufacturing facility in Israel and currently one of thelargest gene-therapy designated ones in the world (20,000 sq. ft.). It is capable of manufacturing in large-scale capacity of 1,000 liters and is scalable to 2,000liters. In November 2017, we signed an exclusive license agreement with NanoCarrier Co., Ltd. (TSE Mothers:4571) for the development, commercialization, andsupply of VB-111 in Japan. VBL retains rights to VB-111 in the rest of the world. Under terms of the agreement, VBL has granted NanoCarrier an exclusivelicense to develop and commercialize VB-111 in Japan for all indications. VBL will supply NanoCarrier with VB-111, and NanoCarrier will be responsiblefor all regulatory and other clinical activities necessary for commercialization in Japan. In exchange, we received an up-front payment of $15 million, and areentitled to receive greater than $100 million in development and commercial milestone payments. VBL will also receive tiered royalties on net sales in thehigh-teens. Based on support from pre-clinical data, which we presented at the American Society of Gene & Cell Therapy (ASGCT) conference in May 2017, we plannedto launch an exploratory study for VB-111 in combination with nivolumab, a checkpoint inhibitor, in non-small cell lung cancer. However, given the readoutof the GLOBE trial, before we launch such study, or studies, we intend to conduct additional data analyses and revisit our clinical plans regarding newindications to seek the best way to advance VB-111 towards commercialization. Our Strategy Our goal is to become a leading biopharmaceutical company focused on discovering, developing and commercializing innovative therapeutics that leverageour proprietary technologies for oncology indications. We intend to achieve this goal by pursuing the following strategies: ●Pursue regulatory approval for our lead oncology compound, VB-111 We believe VB-111 has the potential for applications in various solid tumors, and that the outcome of the GLOBE study in rGBM will not necessarily haveimplications on the prospects for VB-111 in other tumor types. We have conducted Phase 2 clinical trials of VB-111 in both ovarian and thyroid cancer, with positive results. We intend to continue development of VB-111 for platinum-resistant ovarian cancer, and launched a Phase 3 study for this indication in December 2017. Recently we have strengthened our balancesheet to support our development plans through a follow-on offering of $18 million on November 2017, and through a licensing deal for VB-111 in Japan,injecting a $15.0 million upfront payment in November 2017. We may choose to advance VB-111 to additional cancer indications, either independently orthrough investigator-sponsored studies or strategic collaborations. 48 Table of Contents ●Selectively enter into licensing and collaboration arrangements to supplement our internal development capabilities As we advance our pipeline of anti-cancer product candidates, we will evaluate opportunities to selectively form collaborative alliances for our non-oncology assets to expand our capabilities and accelerate the development and commercialization of our oncology products. We engage in conversationswith third parties to evaluate such potential collaborations on an ongoing basis. ●Expand our manufacturing capacity to support clinical trials and possible commercialization of VB-111 We previously manufactured clinical quantities of VB-111 at our facility in Or-Yehuda, Israel and through a third party in the United States. In October 2017,we announced the opening of our new gene therapy manufacturing plant in Modiin, Israel. This plant can be the first commercial facility for production ofVB-111 if it receives regulatory approval. On the longer term, we intend to have more than one manufacturing site for VB-111, if regulatory approved. Our Product Candidates and Technology The following table summarizes the status of pipeline: 49 Table of Contents Our VTS Platform Overview Our innovative, proprietary VTS platform technology enables systemic administration of gene therapy to either destroy or promote angiogenic blood vessels.VTS is both tissue- and condition-specific, allowing for targeted and limited gene expression in endothelial cells, the thin layer of cells that lines the interiorsurface of blood vessels undergoing angiogenesis. Our VTS platform technology comprises three components, a viral vector, a promoter and a transgene: 1. Viral vector—a modified virus that is used as a delivery vehicle to distribute the promoter and the transgene throughout the body. 2. Promoter—our proprietary, genetically modified promoter, called PPE-1-3X, that specifically targets the endothelial cells of angiogenic blood vessels.When present in these cells, the promoter initiates the expression of the transgene. 3. Transgene—a genetic sequence designed to yield a specific biologic effect, the expression of which is directed by PPE-1-3X. The particular transgene willvary depending on the therapeutic objectives of the product candidate. Once the gene therapy has reached the angiogenic blood vessels, the PPE-1-3X promoter activates expression of the transgene to produce a desired RNA orprotein in the endothelial cells of those vessels. For oncology applications, the transgene selected is designed to destroy angiogenic blood vessels that feedsolid tumors. For other potential applications, such as the treatment of ischemia, a different transgene can be selected that is designed to promote thedevelopment of angiogenic blood vessels instead of their destruction. VB-111 (ofranergene obadenovec) VB-111 is a unique biologic agent that uses a dual mechanism to target solid tumors. Its mechanism combines blockade of tumor vasculature with an anti-tumor immune response. Based on a non-integrating, non-replicating, Adeno 5 vector, VB-111 utilizes VBL’s proprietary Vascular Targeting System (VTS™) to target the tumorvasculature for cancer therapy. We designed VB-111 to address oncology indications, specifically solid tumors, by selectively targeting the blood vesselsrequired for tumor growth and encouraging the programmed cell-death process, or apoptosis, of cells in those blood vessels. VB-111 is administeredintravenously. PPE-1-3X is activated specifically in angiogenic endothelial cells and regulates a transgene consisting of a combination of two genesequences known as Fas and TNFR1. When expressed, the transgene produces a unique pro-apoptotic protein, the Fas-TNFR1 chimera, that interacts with anative inflammatory molecule, Tumor Necrosis Factor, or TNF- alpha, and results in the destruction of newly formed or immature blood vessels. Whenactivated by PPE-1-3X, specifically in angiogenic endothelial cells, this combination enables VB-111 to reduce tumor growth in a highly targeted manner. In addition, VB-111 induces a specific anti-tumor immune response. In 2004, we published preclinical data, which suggested that there is an immuneinflammatory response to the presence of the viral vector and the Fas-TNFR1 chimera. Further support for a potential role of the immune system as part of VB-111’s mechanism of action came from an observation that patients who developed fever as a response to VB-111 administration, at least once along thetreatment course, had a survival benefit over those who did not experience post-dosing fever. Moreover, an immunotherapeutic effect was also observed inbiopsies taken from ovarian cancer patients. Immunohistochemistry staining showed regions of apoptotic cancer cells and infiltration of cytotoxic CD8 T-cells following treatment with VB-111. In November 2017, at the Society for Neuro-Oncology conference, we presented data, which support the relationship between VB-111’s novel dual immuno-oncology and vascular targeting mechanisms of action to overall survival, and show that molecular and radiographic biomarkers may serve as predictors ofclinical benefit. 50 Table of Contents VB-111’s mechanism of action is illustrated below: Unlike anti-VEGF agents (such as Avastin®) or tyrosine-kinase inhibitors (TKIs), VB-111 does not aim to block a specific pro-angiogenic pathway; instead, ituses an angiogenesis-specific sensor (VBL’s PPE-1-3x proprietary promoter) to specifically induce cell death in angiogenic endothelial cells in the tumormilieu. This mechanism may retain activity regardless of baseline tumor mutations or the identity of the pro-angiogenic factors secreted by the tumor andshows activity even after failure of prior treatment with other anti-angiogenics. Moreover, VB-111 induces specific anti-tumor immune response, which isaccompanied by recruitment of CD8 T-cells and apoptosis of tumor cells. We believe that this mode of action makes VB-111 less susceptible to resistanceand, therefore, potentially applicable for a broader patient population than current therapies. We have conducted pre-clinical studies in animal models of lung cancer, colon cancer, thyroid cancer, rGBM and melanoma. Based on those studies, andclinical results to date, we believe that VB-111 has anti-tumoral activity that may hold clinical promise and may be suitable for treatment of some solidtumors. We initially decided to focus on rGBM as our first indication because we expected the rapid kinetics of this disease would enable us to accumulateclinical data in a short time, but we also advanced VB-111 to a randomized-controlled Phase 3 study in platinum-resistant ovarian cancer. VB-111 Clinical Programs- Overview We initially studied VB-111 in a Phase 1 “all comers” trial involving patients with multiple types of advanced metastatic cancer types, including thyroidcancer, neuroendocrine cancer, renal cell carcinoma and lung cancer. In that trial, VB-111 was well-tolerated and showed a dose- dependent extension inmedian overall survival across a range of tumor types. Based on these results, we decided to proceed with the development of VB-111 for the lead indicationof rGBM, as well as to investigate VB-111 as a monotherapy for the treatment of thyroid cancer and, in combination with chemotherapy, for ovarian cancer.We have an open IND for VB-111 with the Office of Cellular, Tissue, and Gene Therapeutics within FDA’s Center for Biologics Evaluation and Research. 51 Table of Contents VB-111 Clinical Program in GBM Glioblastoma is a brain cancer that affects approximately 12,000 to 13,000 newly diagnosed people each year in the United States. It is a devastating, rapidlyprogressing tumor, with a median time from diagnosis to the patient’s death of 12 to 15 months. In recurrent glioblastoma, treatment consists of bothsymptomatic and palliative therapies. However, with currently available therapies, glioblastoma typically remains fatal within a very short period of time. We conducted an open-label Phase 2 trial in rGBM, which was originally initiated as an adaptive Phase 1/2 trial. The trial was intended to evaluate the safetyand efficacy of VB-111, both by itself and in combination with bevacizumab, an anti-angiogenesis agent approved by the FDA for use in rGBM. In this trial,patients were initially dosed with VB-111 alone. After disease progression on VB-111 alone, they receive either bevacizumab alone as standard of care, or, ina second cohort, a combination of VB-111 and bevacizumab. Disease progression was defined as a worsening of the patient’s cancer with an increase of atleast 25% in the overall mass of measurable tumors, the appearance of new tumors, the worsening of non-measurable tumors since beginning of treatment, aneed for an increased dose of corticosteroids or clinical deterioration. Our Phase 2 trial results include 46 patients with rGBM treated with VB-111; upon disease progression, 23 patients were treated with VB-111 in combinationwith Avastin ®, and 22 received Avastin ® alone. One patient, who achieved a complete response, is still stable on VB-111 alone for more than 45 months asof December 31, and was included in the continuous exposure cohort. The median number of bi-monthly VB-111 doses was four for the cohort, which wastreated with VB-111 through progression, versus one in the limited exposure cohort (average of 4.7 vs. 2.2, respectively). Continuous exposure to VB-111demonstrated significant improvement in overall survival, with median overall survival of 59.1 weeks (414 days), compared to 31.9 weeks (223 days) inpatients on limited VB-111 exposure (p=0.043), meeting the primary endpoint of the trial. Two complete responses and five partial responses were seen in theVB-111 continuous exposure cohort (n=24), compared to only two partial responses in VB-111 limited exposure cohort (n=22). VB-111 was found to be welltolerated. Trial data also showed that VB-111 may induce an immuno-therapeutic effect. Of the 46 patients who received VB-111, 25 patients experienced a fever post-dosing of VB-111 at least once, while 21 patients did not. Patients with fevers demonstrated increased overall survival of 16 months, compared to patientswithout fevers, who had a median overall survival of 8.5 months (p=0.03). Additional biomarkers analyses presented at the SNO conference in November2017 have demonstrated that in addition to fever, VB-111 is also associated with immune-mediated responses, including secretion of immune-stimulatorycytokines that correlate with OS, further supporting a role of the immune system as part of VB-111’s dual mechanism of action. In June 2016 at the ASCO conference, we presented clinical data that demonstrate a significant overall survival benefit in rGBM patients receiving VB-111compared with historical Avastin ® meta-analysis data. In the Phase 2 VB-111 trial, the median overall survival of patients who received continuous exposureof VB-111 in combination with Avastin was 59.1 weeks. This is compared to 32.1 weeks in the pooled data from the 8 studies in the meta-analysis (p=0.0295;Hazard Ratio 0.62, 95% CI: 0.40-0.96). Median survival ranged from 26.0 weeks to 45.7 weeks in the meta-analysis. Overall survival at 12 months forpatients on continuous exposure of VB-111 was 57%, compared with 24% overall survival (range 16%-38%) for the pooled Avastin ® treated rGBM data(p=0.03). In 62 patients with rGBM, the most frequent toxicity was self-limited fever, starting several hours post therapy and usually resolving within 24 hours andcontrolled with anti-pyretics. There were 22 adverse events classified as grade 3 or higher, of which 7 were considered possibly related to VB-111 includingasthenia, pyrexia, brain edema, depressed consciousness, pulmonary embolism, or PE (in a patient with PE prior to enrollment in the trial) and hypertension.Safety results were reviewed five times by the trial Data and Safety Monitoring Board, as well as by the FDA, without safety concerns. Based on interim Phase2 data of VB-111 in rGBM, the FDA has allowed VBL to launch a Phase 3 study of VB-111 in rGBM patients even prior to the completion of the Phase 2trial. In June 2016 at the ASCO conference, we presented clinical data that demonstrate a significant overall survival benefit in rGBM patients receiving VB-111compared with historical Avastin ® meta-analysis data. In the Phase 2 VB-111 trial, the median overall survival of patients who received continuous exposureof VB-111 in combination with Avastin was 59.1 weeks. This is compared to 32.1 weeks in the pooled data from the 8 studies in the meta-analysis (p=0.0295;Hazard Ratio 0.62, 95% CI: 0.40-0.96). Median survival ranged from 26.0 weeks to 45.7 weeks in the meta-analysis. Overall survival at 12 months forpatients on continuous exposure of VB-111 was 57%, compared with 24% overall survival (range 16%-38%) for the pooled Avastin ® treated rGBM data(p=0.03). VBL’s pivotal Phase 3 GLOBE study was conducted under a Special Protocol Assessment (SPA) granted by the FDA, with full endorsement by the CanadianBrain Tumor Consortium (CBTC). Enrollment in the study, 256 patients in total, started in August 2015 and has been completed in December 2016, fivemonths ahead of schedule. 52 Table of Contents To maintain an SPA agreement, FDA approval is required for any protocol modification. Following a meeting with FDA in December 2016, VBL has receivedFDA approval for adjustments in the GLOBE protocol, while keeping the SPA in place. Originally, the interim DSMC analysis in GLOBE was to beconducted after 91 deaths. The modified protocol specified that it would be conducted after 105 deaths, and after 50% of the patients have more than 12months potential follow up, whichever occurs later. The final analysis would be conducted at 189 deaths (75% of events), versus the original planned for 151deaths (60% of events). In late 2017, FDA had also approved the use of 12-month survival rate and stratification according to baseline tumor volume as studyendpoints under the SPA, along with an exploratory analysis of survival starting at 100 days. Three safety reviews were conducted during the GLOBE trial, by the independent Data Safety Monitoring Committee (DSMC). The DSMC is an independentmultidisciplinary group that conducts detailed review of un-blinded study data, discusses potential safety concerns and provides recommendations regardingtrial continuation. In December 2016, we announced that the independent Data Safety Monitoring Committee (DSMC) met to conduct its first safety reviewof the Phase 3 GLOBE Study investigating ofranergene obadenovec (VB-111) in recurrent glioblastoma (rGBM). The committee reviewed the GLOBE safetydata collected through a cutoff date in September 2016, and did not find any adverse events that would be cause for concern. As a result, the DSMCrecommended that the study continue as planned. In April 2017, we announce that the committee reviewed the GLOBE safety data collected through a cutoffdate in March 2017 and unanimously recommended that the study continue as planned. The Third and final DSMC review took place in September 2017.The committee reviewed the GLOBE safety data, including mortality data, collected through a cutoff date in August 2017 and stated that they did notidentify any safety concerns. The DSMC confirmed that no additional follow up will be necessary. Accordingly, the DSMC unanimously recommended thatthe study continue as planned, to completion. On March 8, 2018 we announced top-line data from the GLOBE study. These results show that the GLOBE study did not meet its pre-specified primaryendpoint of overall survival (OS), or the secondary endpoint of progression-free-survival (PFS). No new safety concerns associated with VB-111 have beenidentified in the GLOBE study. Once we receive the full and final data set, we intend to conduct an in-depth analysis in order to better understand theoutcome of the study and the potential activity of VB-111 in rGBM. VB-111 Clinical Program in Ovarian Cancer In addition to GBM, based on observations from early clinical trials, we have advanced VB-111 into tumor specific, repeat-dose trials, in ovarian cancer andthyroid cancer. Ovarian cancer was diagnosed in approximately 22,000 American women in 2013, according to the National Cancer Institute. In ovarian cancer, clinicaltrials of bevacizumab, which, like VB-111, is an anti-angiogenic agent, demonstrated some improvement in progression free survival in women with high-risk advanced ovarian cancer. Therefore, we conducted a Phase 1/2 clinical trial in ovarian cancer using VB-111 in combination with paclitaxel, a commonchemotherapeutic agent. This trial was designed as a Phase 1/2 dose escalation study. The primary objectives were to evaluate the safety and tolerability and identify dose limitingtoxicity in combination of VB-111 and weekly paclitaxel; and explore the efficacy in an expanded cohort of the optimally tolerated dose of combinationVB-111 and weekly paclitaxel, based on RECIST response, CA-125 response, progression free survival (PFS) and overall survival (OS) in patients withrecurrent platinum-resistant ovarian cancer. Twenty one patients with recurrent platinum-resistant Müllerian/ovarian cancer were enrolled at Massachusetts General Hospital and Dana Farber CancerInstitute, and received up to 7 doses of treatment. Patients were treated in two consecutive cohorts: Low Dose Treatment (n=4, 3x10 12 VPs + 40mg/80 mgpaclitaxel) or a Therapeutic Dose (n=17, 1x10 13 VPs + 80 mg paclitaxel). All patients had measurable disease, with a grade at diagnosis of: 1A (1, 5%), 1B(1, 5%), 1C (1, 5%); IIIC (12, 57%); or IV (6, 29%). The patients included in the study were of particularly adverse prognosis as 48% of the patients wereprimary platinum refractory and 52% had tumors that failed to respond to prior anti-angiogenic agents, including Avastin. In June 2016 at the ASCO conference, we presented clinical top-line data from this trial. The results showed a significant increase in overall survival at thetherapeutic dose of VB-111 vs. the low dose level (810 vs. 172 days, p=0.042). Nine of the 15 evaluable patients (60%) on the therapeutic dose had aresponse, as defined by a 50% reduction in CA-125. Durable RECIST responses and disease stabilizations were seen. This represents an approximatedoubling in response rate, compared to historical data with ovarian cancer patients treated with a combination of Avastin ® and chemotherapy in theAURELIA trial which reported CA-125 response in 11.6% of patients treated with chemotherapy and 31.8% CA-125 response in ovarian cancer patientstreated with a combination of chemotherapy and Avastin ®. 53 Table of Contents An immunotherapeutic effect was also observed in biopsies taken from patients. H&E and immunohistochemistry staining showed regions of apoptoticcancer cells and infiltration of cytotoxic CD8 T-cells following treatment with VB-111. VB-111 was found to be safe and well tolerated. Toxicity was similarto what would be expected with antiangiogenics and taxanes in this patient population. Eight serious adverse events were reported, 2 were considered by theinvestigator to be possibly related to be VB-111. No dose limiting toxicities were reported at any dose level. In December 2016 we had an end-of-Phase 2 meeting with the FDA to discuss the clinical path of VB-111 in ovarian cancer. We reached agreement with theFDA on our clinical plan to proceed to a Phase 3 potential registration study of VB-111 in platinum-resistant patients, with OS as the primary endpoint. Weintend to advance VB-111 for this patient population, for which most current therapies fail to prolong patient survival, and in December 2017 announce theenrollment of the first patient in the OVAL potential registration Phase 3 study of VB-111 in platinum-resistant ovarian cancer. The OVAL study will beconducted in collaboration with the Gynecologic Oncology Group (GOG) Foundation, Inc., a leading organization for research excellence in the field ofgynecologic malignancies. The randomized, controlled, double-blind, Phase 3 OVAL study in recurrent platinum-resistant ovarian cancer has been designed to enroll up to 350 adultpatients at approximately 75 clinical sites in the United States and Israel. Patients will be randomized 1:1 to VB-111 (1x10 13 VPs once every 8 weeks) incombination with chemotherapy (80mg/m2 paclitaxel once weekly), or to placebo with chemotherapy. The primary endpoint is overall survival. Additionalendpoints include objective response rate (ORR), progression free survival (PFS), CA-125, RECIST 1.1 response and patient reported outcome measures.Given the GLOBE trial results, we may choose to adapt the OVAL trial protocol to provide better insight and support of activity of VB-111 in this indicationduring the study. VB-111 Program in Thyroid Cancer We conducted an exploratory Phase 2 clinical trial to evaluate safety and efficacy of VB-111 in advanced thyroid cancer. According to the National CancerInstitute, there are an estimated 535,000 people currently living with thyroid cancer in the United States, with an estimated 60,000 new cases of thyroidcancer each year. Most cases can be treated by surgery and radioactive iodine. If radioactive iodine is ineffective, other treatments are prescribed, suchtyrosine kinase inhibitors and systemic chemotherapy. However, if such treatments are unsuccessful, the therapeutic options for patients are currently verylimited. There are an estimated 2,000 annual deaths in the U.S. as a result of the disease. This subset of patients has an unmet need for novel therapeuticoptions such as VB-111. Our open-label dose-escalating study enrolled patients with advanced, recently-progressive, differentiated thyroid cancer that was unresponsive toradioactive iodine, in two cohorts. Most patients had tumors that had not responded to multiple therapies prior to enrollment, including radiation and kinaseinhibitors. In the first cohort, thirteen patients received a single intravenous infusion of VB-111 at a sub-therapeutic dose of 3X10 12 viral particles (VPs). Thesecond cohort included seventeen patients, who received VB-111 at a therapeutic dose of 10 13 VPs every two months until disease progression. One patientproceeded from a single low dose to receive later multiple high doses at progression and was included in both groups (for PFS only). On February 21, 2017 we announced full data from this trial. The primary endpoint of the trial, defined as 6-month progression-free-survival (PFS-6) of 25%,was met with a dose response. Forty-seven percent (47%; 8/17) of patients in the therapeutic-dose cohort reached PFS-6, versus 25% (4/12) in the sub-therapeutic cohort, both groups meeting the primary endpoint. Reduction in tumor measurement after the first dose was seen in 44% (7/16) of patients in thetherapeutic-dose cohort, compared to 9% (1/11) in the sub-therapeutic-dose cohort. An overall survival benefit was seen with a tail of more than 40% at 3.7years for the therapeutic-dose cohort (mOS 684 days). This is similar to historical data for pazopanib (Votrient ® ), a tyrosine kinase inhibitor; however, mostpatients in the VB-111 study had tumors that previously had progressed on pazopanib or other kinase inhibitors. VB-111 was observed to be well-tolerated inthis study, with no signs of clinically significant safety issues. We see these positive data as additional proof-of-concept for VB-111 in another advanced solid tumor, particularly important for investigating thetherapeutic potential of VB-111 even as monotherapy. Our primary focus continues to be advancement of VB-111 towards commercialization, if approved, inovarian cancer. Further clinical development of VB-111 for thyroid cancer may also be pursued, potentially with a strategic partner, or via an investigator-sponsored study. Additional VB-111 Program Based on support from pre-clinical data, which we presented at the American Society of Gene & Cell Therapy (ASGCT) conference in May 2017, we plannedto conduct an exploratory study for VB-111 in combination with nivolumab, a checkpoint inhibitor, in non-small cell lung cancer. Launch of this trial wasexpected in the first quarter of 2018. However, given the readout of the GLOBE trial, before we launch such study, or studies, we intend to conduct additionaldata analyses and revisit our clinical plans regarding new indications, to seek the best way to advance VB-111 towards commercialization. Additional VTS Pipeline candidates Our VTS platform technology enables systemic administration of gene therapy to either destroy or promote angiogenic blood vessels. Beyond VB-111, wehave generated additional product candidates which utilize the same vector and promoter as in VB-111, yet comprise alternative functional transgenes. VB-511 is an anti-angiogenic candidate, while VB-211 and VB-411 are pro-angiogenic candidates that may be employed for ischemic conditions like peripheralvascular disease. All three candidates have demonstrated pre-clinical efficacy and are ready for toxicology. We may pursue further development of VB-511internally, but we aim to partner-out the pro-angiogenic candidates. 54 Table of Contents Our Lecinoxoid Platform Technology Our proprietary Lecinoxoid platform technology comprises a family of orally administered small molecules designed to modulate the body’s inflammatoryresponse. Lecinoxoids are compounds that are structurally and functionally similar to naturally occurring molecules, known as oxidized phospholipids,which possess immune modulating anti-inflammatory properties, modified to enhance stability and activity. We believe that Lecinoxoids hold significantpromise in their ability to treat a range of chronic immune-based inflammatory diseases. The inflammatory response is a complex physiologic process balancing both pro- and anti- inflammatory components that interact intimately with the body’simmune system. Oxidized phospholipids are instrumental in the interplay of these components that maintain equilibrium. When the inflammatory response isnot adequately balanced, excess inflammation results and may cause both acute and chronic disease states. The Lecinoxoid platform seeks to harness the ability of oxidized phospholipids to regulate and attenuate key immune-inflammatory signaling. We believethat our approach—identifying naturally occurring anti-inflammatory compounds and modifying them to enhance stability and activity—may lead to morephysiologically balanced responses than other available anti-inflammatory therapies. 55 Table of Contents VB-201 Our lead Lecinoxoid-based compound, VB-201, was designed as an oral agent for the control of chronic inflammatory disorders. It was clinically developedfor psoriasis and ulcerative colitis, however, our recent Phase 2 data do not support further development for these indications. We believe that VB-201 maystill have potential in other disorders in which TLR-2 and TLR-4 or monocytes play a role. In this regard, in April 2016 we announced a scientificpublication of preclinical findings demonstrating that VB-201, and its next-generation derivative VB-703, can inhibit Non-Alcoholic Steatohepatitis, orNASH, and liver fibrosis in a murine NASH model. Non-alcoholic fatty liver disease is the most common liver disease in the western world. This pathological condition is characterized by lipid accumulationin hepatocytes and ranges from the non-progressive form termed steatosis to NASH, the progressive form that is prone to the development of cirrhosis, livercancer, and liver failure. NASH is characterized by fatty liver inflammation. Several studies have implicated TLR4 and its co-receptor CD14 in NASH andfibrosis. In addition, studies have emphasized the crucial role of infiltrating monocytes/macrophages for the progression of liver inflammation and fibrosis inexperimental mouse models and in patients with liver cirrhosis. It has become clear that the macrophage compartment of the liver, traditionally called Kupffercells, is greatly augmented by an overwhelming number of infiltrating monocytes upon acute or chronic liver injury. VB-201 inhibits the CD-14/TLR4 and TLR2 pathways as well as monocyte migration. Using an external CRO, we studied VB-201 in a mouse model ofNASH and found that while treatment with VB-201 did not reduce steatosis, it significantly decreased liver lobular inflammation and liver fibrosis comparedto vehicle treated mice. Furthermore, in April 2017 VBL presented findings of a post-hoc, hypothesis-driven analysis of data from completed Phase 2 studieswith VB-201, indicating that VB-201 may reduce certain liver enzymes in blood samples from treated patients, in a time-dependent and dose-dependentmanner. VBL may seek to strengthen these findings and investigate the potential of VB-201 through an exploratory Phase 2 study in NASH patients. Beyond VB-201, we have developed second and third generations of Lecinoxoid product candidates. Our results highlight the potential of some of thesemolecules, such as VB-703, a third generation candidate whose IP life-cycle can extend to the mid-2030s. In May 2015 at the DDW conference, we presentedthat VB-703 inhibits liver fibrosis by blocking TLR4 signaling pathways. Recent preclinical studies which we performed also demonstrate efficacy of VB-201 and VB-703 in a rat model of renal fibrosis. Renal fibrosis is a directconsequence of the kidney’s limited capacity to regenerate after injury. Renal scarring results in a progressive loss of renal function, ultimately leading toend-stage renal failure and a requirement for dialysis or kidney transplantation. Our lead Lecinoxoid molecule, VB-201, is a Phase-2 ready oral molecule which has demonstrated safety in > 600 patients and proof-of-concept in a Phase 2study for vascular inflammation. Our next-generation molecule VB-703, offers long IP lifecycle with demonstrated efficacy in liver and renal fibrosis models. The following table summarizes the status of the Lecinoxoid platform: 56 Table of Contents We believe that Lecinoxoids have therapeutic potential in disorders in which TLR-2 and TLR-4 or monocytes play a role, such as atherosclerosis,NASH/Liver fibrosis and renal fibrosis. In spite of that potential, we have decided strategically to focus our efforts and resources on development of novelanti-cancer therapies, such as VB-111 and MOSPD2. Therefore, we may seek some proof-of-concept findings for Lecinoxoids , but on the longer term weintend to seek one or more strategic partners that would help us to promote the development of our Lecinoxoid assets. Expanding our Pipeline—The VB-600 Family We intend to continue research and development activities in the oncology field to strengthen the pipeline of our anti-cancer drug candidates. In this regard,we believe that we have identified a novel tumor-related target, MOSPD2, that may be used as a marker for selective targeting of several types of tumors. InJanuary 2017, a manuscript published by VBL disclosed that MOSPD2, a protein with a previously unknown function, regulates cell migration in humanmonocytes. While this first manuscript focused on the importance of MOSPD2 in immune cells, research conducted by VBL has explored the relevance ofMOSPD2 in motility and metastasis of tumor cells. These oncology-related data were presented at the American Association of Cancer research (AACR)conference in April 2017. We believe that targeting of MOSPD2 may have several therapeutic applications, including inhibition of monocyte migration inchronic inflammatory conditions, inhibition of tumor cell metastases and targeting of MOSPD2-expressing tumor cells. We are developing our VB-600 seriesof pipeline candidates towards these applications. We expect to present additional findings related to our MOSPD2 program for cancer in the second quarterof 2018. Intellectual Property Our success depends, at least in part, on our ability to protect our proprietary technology and intellectual property, and to operate without infringing orviolating the proprietary rights of others. We rely on a combination of patent, trademark, trade secret and copyright laws, know- how, intellectual propertylicenses and other contractual rights, including confidentiality and invention assignment agreements to protect our intellectual property rights. Patents As of January 28, 2018, we had 178 granted patents and 39 applications pending worldwide for our oncology program and VTS platform technology and 110granted patents and 30 patent applications pending worldwide for our anti-inflammatory program and Lecinoxoid family of compounds. Our lead VTS asset,VB-111, is covered by US granted patent extending to 2033 before any extensions. Our lead Lecinoxoid, VB-201, is protected by US granted composition-of-matter patent extending to 2027 before any extensions. In addition, we have pending patent applications covering use of VB-201, VB-703 and additionalLecinoxoid for NASH and fibrosis indications that may extend, if granted, to the 2030s. For MOSPD2, there are 2 applications pending worldwide. Trademarks We rely on trade names, trademarks and service marks to protect our name brands. Our registered trademarks in several countries include the following:“VTS,” “VASCULAR TARGETING SYSTEMS,” “VBL,” “V VBL THERAPEUTICS & Design,” “VASCULAR BIOGENICS,” “VASCULARTHERAPEUTICS” and “GLOBE & Design.” Trade Secrets and Confidential Information In addition to patented technology, we rely on our unpatented proprietary technology, trade secrets, processes and know-how. We rely on, among otherthings, confidentiality and invention assignment agreements to protect our proprietary know-how and other intellectual property that may not be patentable,or that we believe is best protected by means that do not require public disclosure. For example, we require our employees to execute confidentialityagreements in connection with their employment relationships with us, and to disclose and assign to us inventions conceived in connection with theirservices to us. However, there can be no assurance that these agreements will be enforceable or that they will provide us with adequate protection. 57 Table of Contents We may be unable to obtain, maintain and protect the intellectual property rights necessary to conduct our business, and may be subject to claims that weinfringe or otherwise violate the intellectual property rights of others, which could materially harm our business. For a more comprehensive summary of therisks related to our intellectual property, see “Risk Factors.” Sales and Marketing We have not yet established sales, marketing or product distribution operations because our lead candidates are still in early clinical development. Manufacturing We generally perform process development for our drug substance candidates and manufacture quantities of our drug candidates necessary to conduct pre-clinical studies and clinical trials of our drug candidates. We rely on third-party manufacturers to produce bulk drug substance required for our clinical trialsand expect to continue to rely on third parties to manufacture clinical trial drug supplies for the foreseeable future. We also contract with additional thirdparties for the formulating, labeling, packaging, storage and distribution of the final drug products. VB-111 Until late 2017, we manufactured the active pharmaceutical ingredient and the formulated drug product of VB-111 for the clinical development at our small-scale cGMP-compliant production facility in Or-Yehuda, Israel and pursuant to an arrangement with a third party in the United States. In October 2017, we announced the opening of our new gene therapy manufacturing plant in Modiin, Israel. This plant will be the commercial facility forproduction of the Company’s lead product candidate, ofranergene obadenovec (VB-111), if approved. The site design enables modular expansion of themanufacturing capacity, to supply growing demand following commercialization. The Modiin facility shall also enable us to comply with the restrictions ofthe Research Law and our undertaking to the OCS that an essential portion of our VB-111 production, and in any event not less than the majority of VB-111production, will remain in Israel. The investment in the facility is included in the Company’s budget and was also supported by the Israel InnovationAuthority. VBL expects that its current cash will fund the Company’s operating expenses and capital expenditure requirements through 2020. Employees As of March 1, 2018, we employed 37 employees, including 30 in research and development, and 7 in general and administrative positions, and of which 14employees have either MDs or PhDs. All of our employees are located in Israel. We believe our employee relations are good. Israeli labor laws govern the length of the workday, minimum wages for employees, procedures for hiring and dismissing employees, determination ofseverance pay, annual leave, sick days, advance notice of termination of employment, equal opportunity and anti- discrimination laws and other conditionsof employment. Subject to specified exceptions, Israeli law generally requires severance pay upon the retirement, death or dismissal of an employee, andrequires us and our employees to make payments to the National Insurance Institute, which is similar to the U.S. Social Security Administration. Ouremployees have defined benefit pension plans that comply with the applicable Israeli legal requirements. 58 Table of Contents None of our employees currently work under any collective bargaining agreements. Property Our corporate headquarters and research facilities are currently located in Modi’in, Israel, where we lease an aggregate of approximately 21,500 square feet ofoffice and laboratory space, pursuant to a lease agreement that expires in June 2023. This facility additionally houses our clinical development, clinicaloperations, regulatory and management functions, as well as our local biological drugs manufacturing facility. Organizational Structure We do not have any subsidiaries. Legal Proceedings We are not a party to any legal proceedings. Item 4A. Unresolved Staff Comments Not applicable. Item 5. Operating and Financial Review and Prospects The following discussion of our financial condition and results of operations should be read in conjunction with “Item 3. Key Information—SelectedFinancial Data” and our financial statements and the related notes to those statements included elsewhere in this Annual Report. In addition to historicalfinancial information, the following discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. Ouractual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of many factors,including those discussed under “Item 3. Key Information—D. Risk Factors” and elsewhere in this Annual Report. The audited financial statements for the years ended December 31, 2017, 2016 and 2015 and as of December 31, 2017 and 2016 in this Annual Reporthave been prepared in accordance with IFRS as issued by the IASB. None of the financial information in this Annual Report has been prepared inaccordance with U.S. GAAP. Overview We are a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of first-in-class treatments for cancer. Ourprogram is based on our proprietary Vascular Targeting System, or VTS, platform technology, which utilizes genetically targeted therapy to destroy newlyformed, or angiogenic, blood vessels, and which we believe will allow us to develop product candidates for multiple oncology indications. 59 Table of Contents Our lead product candidate, VB-111(ofranergene obadenovec), is a gene-based biologic that we are developing for solid tumor indications, with an advancedprogram for recurrent glioblastoma, or rGBM, an aggressive form of brain cancer, ovarian cancer and thyroid cancer. We have obtained fast track designationfor VB-111 in the United States for prolongation of survival in patients with glioblastoma that has recurred following treatment with standard chemotherapyand radiation. We have also received orphan drug designation in both the United States and Europe. VB-111 has also received an orphan designation for thetreatment of ovarian cancer by the European Medicines Agency. In September 2015, we reported complete results from our Phase 2 trial of VB-111 in rGBM,demonstrating a statistically-significant benefit in overall survival and favorable response rate in patients treated with VB-111 in combination withbevacizumab. Our pivotal Phase 3 GLOBE study in rGBM began in August 2015 and was comparing a combination of VB-111 and bevacizumab tobevacizumab alone. The study which enrolled a total of 256 patients in the US, Canada and Israel was conducted under a special protocol assessment, or SPA,agreement with the U.S. Food and Drug Administration, or FDA, with full endorsement by the Canadian Brain Tumor Consortium (CBTC). On March 8, 2018,we announced top-line results from the GLOBE study, which showed that the study did not meet its pre-specified primary endpoint of overall survival (OS).No new safety concerns associated with VB-111 have been identified in the GLOBE study. Once we receive the full and final data set, we will conduct an in-depth analysis in order to better understand the outcome of the GLOBE study and the potential activity of VB-111 in rGBM. We do not think that results ofthe GLOBE study in rGBM will necessarily have implications on the prospects for VB-111 in other tumor types. Our OVAL phase 3 potential registrationstudy of VB-111 in platinum resistant ovarian cancer was launched in December 2017 and is conducted in collaboration with the GOG Foundation, Inc., aleading organization for research excellence in the field of gynecologic malignancies We also have been conducting a program targeting anti-inflammatory diseases, based on the use of our Lecinoxoid platform technology. Lecinoxoids are anovel class of small molecules we developed that are structurally and functionally similar to naturally occurring molecules known to modulate inflammation.The lead product candidate from this program, VB-201, is a Phase 2-ready molecule that demonstrated efficacy in reducing vascular inflammation in a Phase2 sub-study in psoriatic patients with cardiovascular risk. Due to business limitations associated with the heavy burden of developing medications forcardiovascular diseases, we chose to test it in psoriasis and ulcerative colitis; however, as we reported in February 2015, VB-201 failed to meet the primaryendpoint in Phase 2 clinical trials for psoriasis and for ulcerative colitis. As a result, we have terminated our development of VB-201 in those indications.Nevertheless, based on recent pre-clinical studies, we believe that VB-201 and some second generation molecules such as VB-703 may be applicable forNASH and renal fibrosis, and we may seek a clinical proof of concept in NASH patients through an exploratory Phase 2 study for VB-201. Since theCompany intends to focus substantially all of our efforts and resources on advancing our oncology program, we will seek to advance our Lecinoxoid assetsvia strategic deals. We are also conducting a research program exploring the potential of targeting of MOSPD2 for immuno-oncology applications. In January 2017, we reportedthat targeting of MOSPD2 inhibits chemotaxis of monocytes and neuropils, and that unpublished VBL data also show MOSPD2 expression on certain tumorcells. We believe that targeting of MOSPD2 may have several therapeutic applications, including inhibition of monocyte migration in chronic inflammatoryconditions, inhibition of tumor cell metastases and targeting of MOSPD2-expressing tumor cells. We are developing our “VB-600 series” of pipelinecandidates towards these applications. We are developing our lead oncology product candidate, VB-111, for solid tumor indications, with current clinical programs in rGBM, thyroid cancer andovarian cancer. In interim analyses of data from our ongoing open-label Phase 2 clinical trial of VB-111 in rGBM, we observed dose-dependent attenuationof tumor growth and an increase in median overall survival, which is the time interval from initiation of treatment to the patient’s death. The U.S. FDA hasgranted VB-111 fast track designation for prolongation of survival in patients with glioblastoma that has recurred following treatment with temozolomide, achemotherapeutic agent commonly used to treat newly diagnosed glioblastoma, and radiation. On July 1, 2014, the FDA concurred with the design andplanned analyses of our Phase 3 pivotal trial of VB-111 in rGBM pursuant to an SPA. At the time, commencement of the trial was subject to our providing theagency with more information regarding our potency release assay for the trial. We developed this assay and submitted initial information to the FDA on May26, 2014. On February 5, 2015, the FDA found our data satisfactory and removed the partial hold. We began our Phase 3 pivotal trial of VB-111 in rGBM in August 2015 and completed patient enrollment for the study in December 2016, five months aheadof our initial plan. Following positive safety reviews announced in December 2016, in April 2017 and the third and final safety review that was announced inOctober 2017, the GLOBE trial continued to completion. On March 8, 2018, we announced top-line results from the GLOBE study, which showed that thestudy did not meet its pre-specified primary endpoint of overall survival (OS). VB-111 was also being studied in a Phase 2 trial for recurrent platinum-resistant Ovarian Cancer and in a Phase 2 study in recurrent, iodine-resistantdifferentiated Thyroid cancer. In a Phase 2 trial for recurrent platinum-resistant ovarian cancer, VB-111 demonstrated a statistically significant increase inoverall survival and 60% durable response rate (as measured by reduction in CA-125), approximately twice the historical response with bevacizumab pluschemotherapy in ovarian cancer. In December 2016, we had an end-of-Phase-2 meeting with the FDA, in which we received approval from the FDA toadvance VB-111 for a Phase 3 study in platinum-resistant ovarian cancer, which we launched in December 2017. The OVAL study is conducted incollaboration with the Gynecologic Oncology Group (GOG) Foundation, Inc., a leading organization for research excellence in the field of gynecologicmalignancies.. 60 Table of Contents In February 2017, we reported full data from our exploratory Phase 2 study of VB-111 in recurrent, iodine-resistant differentiated thyroid cancer. The primaryendpoint of the trial, defined as 6-month progression-free-survival (PFS-6) of 25%, was met with a dose response. Forty-seven percent of patients in thetherapeutic-dose cohort reached PFS-6, versus 25% in the sub-therapeutic cohort, both groups meeting the primary endpoint. An overall survival benefit wasseen, with a tail of more than 40% at 3.7 years for the therapeutic-dose cohort, similar to historical data for pazopanib (Votrient), a tyrosine kinase inhibitor;however, most patients in the VB-111 study had tumors that previously had progressed on pazopanib or other kinase inhibitors. As of December 31, 2016, wehad studied VB-111 in over 200 patients and have observed it to be well-tolerated. In December 2015, we have been granted a US composition of matterpatents that provides intellectual property protection for VB-111 in the US until October 2033 before any patent term extension. In June 2017, at the BIO international conference we provided an update on the long-term status and survival of patients from three completed Phase 2 trialswith VB-111. In the Phase 2 study in rGBM patients, 12-month survival was 54% in patients who were treated with VB-111 through progression, including arGBM patient who remains alive with complete response after >40 months, compared to 23% of patients who had limited exposure of a therapeutic dose ofVB-111. According to a meta-analysis, the 12-month survival on Avastin (bevacizumab) is only 24%. In the Phase 2 study in recurrent platinum-resistant andrefractory ovarian cancer, 53% of patients treated with a therapeutic dose of VB-111 in combination with paclitaxel were alive at 15 months. No patients inthe sub-therapeutic dose were alive at the 15-month time point. In the Phase 2 study in radioiodine refractory differentiated thyroid cancer, 53% of those whoreceived multiple therapeutic doses of VB-111 were alive at 24 months, compared to 33% of those who received a single, sub-therapeutic dose of VB-111. In October 2017, we announced the opening of our new gene therapy manufacturing plant in Modiin, Israel. This plant will be the commercial facility forproduction of VB-111, if approved. The Modiin facility is the first commercial-scale gene therapy manufacturing facility in Israel and currently one of thelargest gene-therapy designated ones in the world (20,000 sq. ft.). It is capable of manufacturing in large-scale capacity of 1,000 liters and is scalable to 2,000liters. In November 2017, we signed an exclusive license agreement with NanoCarrier Co., Ltd. (TSE Mothers:4571) for the development, commercialization andsupply of VB-111 in Japan. VBL retains rights to VB-111 in the rest of the world. Under terms of the agreement, VBL has granted NanoCarrier an exclusivelicense to develop and commercialize VB-111 in Japan for all indications. VBL will supply NanoCarrier with VB-111, and NanoCarrier will be responsiblefor all regulatory and other clinical activities necessary for commercialization in Japan. In exchange, we received an up-front payment of $15 million, and areentitled to receive greater than $100 million in development and commercial milestone payments if certain development and commercial milestones areachieved. VBL will also receive tiered royalties on net sales in the high-teens. We commenced operations in 2000, and our operations to date have been limited to organizing and staffing our company, business planning, raising capital,developing our VTS and Lecinoxoid platform technologies and developing our product candidates, including conducting pre-clinical studies and clinicaltrials of VB-111 and VB-201. To date, we have funded our operations through private sales of preferred shares, a convertible loan, public offering and grantsfrom the Israeli Office of Chief Scientist, or OCS, which has later transformed to the Israeli Innovation Authority, or IIA, under the Israel Encouragement ofResearch and Development in Industry, or the Research Law. We have no products that have received regulatory approval and accordingly have nevergenerated regular revenue streams. Since our inception and through December 31, 2017, we had raised an aggregate of $232.8 million to fund our operations,of which $113.4 million was from sales of our equity securities, $40.5 from our initial public offering, or IPO, $15 million from a November 3, 2015underwritten offering, approximately $24.0 million from a June 7, 2016 registered direct offering, $17.9 million from a November 16, 2017 underwrittenoffering, and $22.0 million from NATI grants. Since inception, we have incurred significant losses. For the years ended December 31, 2017, 2016 and 2015, our loss was $10.1 million, $16.0 million, and$14.9 million, respectively. We expect to continue to incur significant expenses and losses for at least the next several years. As of December 31, 2017, wehad an accumulated deficit of $168.2 million. Our losses may fluctuate significantly from quarter to quarter and year to year, depending on the timing of ourclinical trials, the receipt of payments under any future collaborations we may enter into, and our expenditures on other research and development activities. As of December 31, 2017, we had cash, cash equivalents and short-term bank deposits of $54.7 million. To fund further operations, we will need to raiseadditional capital. We may seek to raise more capital to pursue additional activities, which may be through a combination of private and public equityofferings, government grants, strategic collaborations and licensing arrangements. Additional financing may not be available when we specifically need it ormay not be available on terms that are favorable to us. As of March 1, 2018, we had 37 employees. As of October 2017, our operations relocated from OrYehuda, Israel to a single facility in Modiin, Israel. 61 Table of Contents Financial Overview Revenues and Cost of Revenues To date, we have generated approximately $13.9 million revenue from an exclusive license agreement for the development, commercialization, and supply ofofranergene obadenovec (“VB-111”) in Japan for all indications for a $15.0 million upfront payment, in addition to a $2.0 million incurred milestonepayment. The cost of revenues associated with these payments was approximately $0.3 million to Tel Hashomer for a 2% consideration that was received forgranting a license or similar rights to this intellectual property. We do not expect to receive any other revenue from any product candidates that we developunless and until we obtain regulatory approval and commercialize our products or enter into collaborative agreements with third parties. Research and Development Expenses Research and development expenses consist of costs incurred for the development of both of our platform technologies and our product candidates. Thoseexpenses include: ●employee-related expenses, including salaries and share-based compensation expenses for employees in research and developmentfunctions; ●expenses incurred in operating our laboratories and small-scale manufacturing facility; 62 Table of Contents ●expenses incurred under agreements with CROs and investigative sites that conduct our clinical trials; ●expenses relating to outsourced and contracted services, such as external laboratories, consulting and advisory services; ●supply, development and manufacturing costs relating to clinical trial materials; ●maintenance of facilities, depreciation and other expenses, which include direct and allocated expenses for rent and insurance; and ●costs associated with pre-clinical and clinical activities. Research and development activities are the primary focus of our business. Product candidates in later stages of clinical development generally have higherdevelopment costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical trials. Ourresearch and development expenses may increase in absolute dollars in future periods as we continue to invest in research and development activities relatedto the development of our platform technologies and product candidates. In particular, our research and development expenses may increase as we developVB-111 beyond rGBM, and continue its clinical development in ovarian cancer and thyroid cancer. In addition, our research and development expenses mayincrease as we develop our VB-600 series of product candidates. Research expenses are recognized as incurred. An intangible asset arising from the development of our product candidates is recognized if certaincapitalization conditions are met. As of December 31, 2017, we did not have any capitalized development costs. Costs for certain development activities are recognized based on an evaluation of the progress to completion of specific tasks using information and dataprovided to us by our vendors and clinical sites. Nonrefundable advance payments for goods or services to be received in future periods for use in researchand development activities are deferred and capitalized. The capitalized amounts are then expensed as the related goods are delivered and the services areperformed. We have received grants from the IIA as part of the research and development programs for our VTS and Lecinoxoid platform technologies. The requirementsand restrictions for such grants are found in the Research Law. These grants are subject to repayment through future royalty payments on any productsresulting from these research and development programs, including VB-111 and VB-201. Under the Research Law, royalties of 3% to 3.5% on the revenuesderived from sales of products or services developed in whole or in part using these IIA grants are payable to the Israeli government. The maximum aggregateroyalties paid generally cannot exceed 100% of the grants made to us, plus annual interest generally equal to the 12-month LIBOR applicable to dollardeposits, as published on the first business day of each calendar year. The total gross amount of grants actually received by us from the IIA, including accruedLIBOR interest as of December 31, 2017 and 2016, totaled $26.9 million and $23.3 million, respectively. As of December 31, 2017, we have incurred a $510thousand royalty payment to the IIA derived from an upfront and a milestone payment from an exclusive license agreement. The Research Law is targeted at maintaining the intellectual property and manufacturing rights relating to IIA-funded projects in Israel. Under certaincircumstances, where the above is not followed, the royalty rate might be higher and accordingly calculated to a formula based on the ratio of theparticipation by the State in the project to the total project costs incurred us. In addition to paying any royalty due, we must abide by other restrictions associated with receiving such grants under the Research Law that continue toapply following repayment to the IIA. These restrictions may impair our ability to outsource manufacturing, engage in change of control transactions orotherwise transfer our know-how outside of Israel, and may require us to obtain the approval of the IIA for certain actions and transactions and pay additionalroyalties and other amounts to the IIA. In addition, any change of control and any change of ownership of our ordinary shares that would make a non-Israelicitizen or resident an “interested party,” as defined in the Research Law, requires prior written notice to the IIA. If we fail to comply with the Research Law,we may be subject to criminal charges. 63 Table of Contents Under applicable accounting rules, the grants income from the IIA have been accounted for as an off-set against the related research and developmentexpenses in our financial statements. As a result, our research and development expenses are shown on our financial statements net of the IIA grants. General and Administrative Expenses General and administrative expenses consist principally of salaries and related costs for personnel in executive and finance functions such as salaries, benefitsand share-based compensation. Other general and administrative expenses include facility costs not otherwise included in research and developmentexpenses, communication expenses, and professional fees for legal services, patent counseling and portfolio maintenance, consulting, auditing andaccounting services. Marketing Expenses Marketing expenses consists principally of salaries and related cost for personnel in marketing and commercialization functions such as salaries, benefits andshare-based compensation, in addition to commercialization consulting services. Financial Expenses (Income), Net Financial income is comprised of interest income generated from interest earned on our cash, cash equivalents and short-term bank deposits and gains andlosses due to fluctuations in foreign currency exchange rates mainly in the appreciation and depreciation of the NIS exchange rate against the U.S. dollar. Financial expenses primarily consist of fluctuations in foreign currency exchange rates. Taxes on Income We have not generated taxable income since our inception, and had carry forward tax losses as of December 31, 2017 of $144.9 million. We anticipate thatwe will be able to carry forward these tax losses indefinitely to future tax years. Accordingly, we do not expect to pay taxes in Israel until we have taxableincome after the full utilization of our carry forward tax losses. We recognize deferred tax assets on losses for tax purposes carried forward to subsequent years if utilization of the related tax benefit against a future taxableincome is expected. We have not created deferred taxes on our tax loss carry forward since their utilization is not expected in the foreseeable future. Critical Accounting Policies and Significant Judgments and Estimates This management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which have beenprepared in accordance with IFRS. The preparation of these financial statements requires us to make estimates and assumptions that affect the reportedamounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expensesincurred during the reporting periods. Estimates and judgments are continually evaluated and are based on historical experience and other factors, includingexpectations of future events that are believed to be reasonable under the circumstances. We make estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. Theestimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the nextfinancial year are discussed below. Revenue In 2017, the Company signed a license and supply agreement as more fully described in note 8. In determining the amounts to be recognized as revenue, theCompany used its judgement in the following main issues: Identifying the performance obligations in the agreement and determining whether the license provided is distinct - based on the Company's analysis, thelicense is distinct as the licensee is able to benefit from the license on its own at its current stage (inter alia, due to sublicensing rights, rights andresponsibility for development in the territory, etc.). Allocation of the transaction price – the Company estimated the standalone selling prices of the services to be provided based on expected cost plus a marginand used the residual approach to estimate the standalone selling price of the license as the Company has not yet established a price for the license, and it hasnot previously been sold on a standalone basis. Share-Based Compensation We operate a number of equity-settled, share-based compensation plans for employees (as defined in IFRS 2 “Share-Based Payments”), directors and serviceproviders. As part of the plans, we grant employees, directors and service providers, from time to time and at our discretion, options to purchase our ordinaryshares. The fair value of the services received in exchange for the grant of the options is recognized as an expense in our statements of comprehensive lossand is carried to additional paid in capital in our statements of financial position. The total amount is recognized as an expense ratably over the vestingperiod of the options, which is the period during which all vesting conditions are expected to be met. 64 Table of Contents We estimate the fair value of our share-based awards to employees, directors and service providers using the Black-Scholes option pricing model, whichrequires the input of highly subjective assumptions, including (a) the expected volatility of our shares, (b) the expected term of the award, (c) the risk-freeinterest rate, and (d) expected dividends. Due to the lack of a public market for the trading of our shares until October 2014 and a lack of company-specifichistorical and implied volatility data, we have based our estimate of expected volatility on the historic volatility of a group of similar companies that arepublicly traded. For options granted since 2015, the expected volatility was calculated using weighted average and was based on the stock price volatility ofthe Company since October 1st, 2014 (IPO date) and the remaining years on the stock price volatility of similar companies. We will continue to apply this process until a sufficient amount of historical information regarding the volatility of our own share price becomes available. We are also required to estimate forfeitures at the time of grant, and revise those estimates in subsequent periods if actual forfeitures differ from the estimates.Vesting conditions are included in assumptions about the number of options that are expected to vest. At the end of each reporting period, we revise ourestimates of the number of options that are expected to vest based on the nonmarket vesting conditions. We recognize the impact of the revision to originalestimates, if any, in profit or loss, with a corresponding adjustment to additional paid in capital. The following table summarizes the weighted average assumptions we have used in our Black-Scholes calculations for the years ended December 31, 2017,2016 and 2015: Year ended December 31, 2017 2016 2015 Employee share options: Risk-free interest rate 2.15%-2.44% 1.64%-1.78% 1.99%-2.28%Expected dividend yield 0% 0% 0%Expected volatility 97.0% 86%-97.0% 69%-85.0%Expected term (years) 11 11 11 The following table summarizes the allocation of our share compensation expense: Year ended December 31, 2017 2016 2015 (in thousands) Research and development $2,027 $900 $385 General and administrative 1,977 520 656 Marketing 148 — — Total $4,152 $1,420 $1,041 Share-based compensation expense for the year ended December 31, 2017 were $4,152 thousand, compared to $1,420 thousand for the year ended December31, 2016, an increase of $2,732 thousand. The increase is mainly due to stock based compensation expenses granted and recognized in 2017 to theemployees and officers of the Company. Clinical trial accruals Clinical trial expenses are charged to research and development expense as incurred. The Company accrues for expenses resulting from obligations undercontracts with clinical research organizations (CROs). The financial terms of these contracts are subject to negotiations, which vary from contract to contractand may result in payment flows that do not match the periods over which materials or services are provided. The Company’s objective is to reflect theappropriate trial expense in the financial statements by matching the appropriate expenses with the period in which services and efforts are expended. As ofDecember 31, 2017, the company had clinical accruals in the amount of approximately $1.5 million. 65 Table of Contents Results of Operations Comparison of Years Ended December 31, 2017, 2016 and 2015 Year ended December 31, 2017 Increase (Decrease) 2016 Increase (Decrease) 2017 2016 2015 $ % $ % (in thousands) Revenues $13,864 — — $13,864 100% — — Cost of Revenues (340) — (340) 100% — — Gross profit 13,524 — — 13,524 100% — — Expenses: Research and development, gross $19,959 $14,147 $13,049 $5,812 41% $1,098 8%Government grants (2,189) (1,700) (1,851) (489) 29% 151 -8%Research and development, net $17,770 $12,447 $11,198 $5,323 43% $1,249 11%General and administrative 5,847 3,828 3,673 2, 019 53% 155 4%Marketing 562 — — 562 100% — — Operating loss 10,655 16,275 14,871 (5,620) -35% 1,404 9%Financial expense (income), net (517) (273) 17 (244) 89% (290) -1706%Loss $10,138 $16,002 $14,888 $(5,864) -37% $1,114 7% Revenues. On November 3, 2017 the Company entered into an exclusive license agreement with NanoCarrier Co., Ltd. for the development, commercialization, andsupply of ofranergene obadenovec (“VB-111”) in Japan for all indications. In exchange, the Company received an up-front and a milestone payment of $17.0million in aggregate, of which $13.9 million was recognized in 2017. This was offset in 2017 by a cost of revenues payment of approximately $0.3 million toTel Hashomer for a 2% consideration that was received for granting a license or similar rights to this intellectual property. Research and development expenses, net. Research and development expenses are shown net of IIA grants. Research and development expenses, net for the year ended December 31, 2017 were $17.8million, compared to $12.4 million for the year ended December 31, 2016 and $11.2 million for the year ended December 31, 2015, an increase of $5.3million or 43% and an increase of $1.2 million, or 11%, respectively. The increase in research and development expenses, net in 2017 was mainly due toincreased expenses for the VB-111 subcontractors and consultants in 2017 of $4.0 million as the Phase 3 pivotal trial of VB-111 in rGBM continued with thecompletion of patient recruitment and trial progression, in addition to costs incurred for the Ovarian Phase 3 trial that commenced in the fourth quarter of2017, and an increase of payroll related costs due to an overall increase of share based compensation of approximately $1.0 million. This was offset by anincrease in the amounts of IIA grants received of $0.5 million in 2017 due to the realization of the 2016 approved grant for the GBM program. The increase inresearch and development expenses, net in 2016 was mainly due to increased expenses for the VB-111 subcontractors and consultants in 2016 of $2.4million as the Phase 3 pivotal trial of VB-111 in rGBM continued with the completion of patient recruitment and trial progression, offset by lower expensesfor VB-201 and psoriasis subcontractors and consultants of $0.6 million in 2015 that began winding down from 2014, and lower VB-111 batch productioncosts of $0.5 million due to the increased manufacturing costs in 2015 to supply the Phase 3 trial supply. General and administrative expenses. General and administrative expenses for the year ended December 31, 2017 were $5.8 million, compared to $3.8 million for the year ended December 31,2016 and $3.7 million for the year ended December 31, 2015, an increase of $2.0 million or 53%, and an increase of $155 thousand or 4%, respectively. Theincrease in 2017 is mainly due to payroll related costs for management share-based compensation expense of approximately $1.0 million, in addition to anincrease to share-based compensation expense for options granted to independent directors of approximately $600 thousand. The increase in 2016 is mainlydue to payroll related costs for management bonuses and employee share-based compensation expense of approximately $500 thousand, offset by a decreaseto share-based compensation expense for options granted to external directors of approximately $300 thousand. Marketing expenses Marketing expenses for the year ended December 31, 2017 were $0.6 million and mainly composed of compensation related costs and share-basedcompensation expense for a new executive who is in charge of marketing and commercialization and joined the Company in June 2017, in addition tocommercialization consulting costs incurred during 2017. 66 Table of Contents Financial expense (income), net. Financial expense (income), net for the year ended December 31, 2017 was ($517) thousand, compared to ($273) thousand for the year ended December 31,2016, and $17 thousand for the year ended December 31, 2015, a decrease of $244 thousand and $290 thousand or 89% and 100%, respectively. Thedecrease in 2017 was mainly related to higher interest received due to more favorable interest rates and favorable exchange rates, and the decrease in 2016was mainly related to higher interest received due to more favorable interest rates. Liquidity and Capital Resources Since our inception and through December 31, 2017, we have raised a total of $113.4 million from sales of our equity securities before the initial publicoffering, $40.5 million gross in our initial public offering ($34.9 million net), $15.0 million from a November 3, 2015 underwritten offering ($13.6 millionnet), $24.0 million from a June 7, 2016 registered direct offering ($21.9 million net), $17.9 million from a November 16, 2017 underwritten offering, and$22.0 million from IIA grants. Our primary uses of cash have been to fund working capital requirements and research and development, and we expect thesewill continue to represent our primary uses of cash. We intend to use our cash resources, together with the proceeds from the offerings described above, toadvance clinical programs, working capital, and other general corporate purposes. We expect that our cash resources as of December 31, 2017 would providesufficient funding for our operations through 2020. In December 2016, we entered into separate Equity Distribution Agreements with JMP Securities LLC and Chardan Capital Markets, LLC, as sales agents, toimplement an “at the market offering” program under which we, from time to time, may offer and sell our ordinary shares, having an aggregate offering priceof up to $20.0 million. We have provided the sales agents with customary indemnification rights, and the sales agents will be entitled to a fixed commissionof 3.0% of the aggregate gross proceeds from the shares sold. For the year ended December 31, 2017, we have sold an aggregate of 224,695 ordinary sharesunder its at-the-market equity facility. The total consideration amounted to $1,322 thousand, net of issuance costs. Funding Requirements At December 31, 2017, we had cash, cash equivalents and short-term bank deposits of $54.7 million and working capital of $50.9 million. We expect that ourcash and cash equivalents and short-term bank deposits will enable us to fund our operating expenses and capital expenditure requirements through 2020and are expected to be sufficient to enable us to complete our Phase 3 clinical trial of VB-111 in rGBM. We are unable to estimate the amounts of increasedcapital outlays and operating expenses associated with completing the development of VB-111 and our other product candidates. Our future capitalrequirements will depend on many factors, including: ● the costs, timing and outcome of regulatory review of VB-111 and any other product candidates we may pursue; ●the costs of future development activities, including clinical trials, for VB-111 and any other product candidates we may pursue; ●the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defendingintellectual property-related claims; ●the extent to which we acquire or in-license other products and technologies; and ●our ability to establish any future collaboration arrangements on favorable terms, if at all. Until such time, if ever, as we can generate substantial product revenue, we expect to finance our cash needs through a combination of equity offerings, debtfinancings, collaborations, strategic alliances and licensing arrangements. We do not have any committed external source of funds. To the extent that we raiseadditional capital through the sale of equity or convertible debt securities, the ownership interest of our shareholders will be diluted, and the terms of thesesecurities may include liquidation or other preferences that adversely affect your rights as a holder of our ordinary shares. Debt financing, if available, mayinvolve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capitalexpenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances or licensing arrangements with third parties, wemay have to relinquish valuable rights to our technologies, future revenue streams or research programs or grant licenses on terms that may not be favorableto us. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate ourproduct development or future commercialization efforts or grant rights to develop and market VB-111 and any other product candidates that we wouldotherwise prefer to develop and market ourselves. 67 Table of Contents Cash Flows The following table sets forth the primary sources and uses of cash for each of the periods set forth below: Year ended December 31, 2017 2016 2015 (in thousands) Cash used in operating activities $(3,821) $(13,412) $(13,203)Cash used in investing activities (20,840) (4,091) (30,090)Cash provided by financing activities 19,510 21,980 13,746 Net (decrease) increase in cash and cash equivalents $(5,151) $4,477 $(29,547) Operating Activities Cash used in operating activities for the year ended December 31, 2017 was $3.8 million and consisted primarily of net loss of $10.1 million arising primarilyfrom research and development activities, partially offset by net reduction in working capital of $2.3 million and net aggregate non-cash charges of $3.7million. Cash used in operating activities for the year ended December 31, 2016 was $13.4 million and consisted of primarily net loss of $16.0 million arisingprimarily from research and development activities, partially offset by a net reduction of working capital of $1.1 million and net aggregate non-cash chargesof $1.3 million. Cash used in operating activities for the year ended December 31, 2015 was $13.2 million and consisted of primarily net loss of $14.9 million arisingprimarily from research and development activities, partially offset by a net reduction of working capital of $0.5 million and net aggregate non-cash chargesof $1.2 million. Investing Activities Net cash used in investing activities was $20.8 million for the year ended December 31, 2017. This was primarily due to the purchases of short-term bankdeposits and the purchases of Property Plant & Equipment in relation to the new Modiin facility. Net cash used in investing activities was $4.1 million for the year ended December 31, 2016. This was primarily due to the purchases of short-term bankdeposits. Net cash used in investing activities was $30.1 million for the year ended December 31, 2015. This was primarily due to the purchases of short-term bankdeposits. Financing Activities Net cash provided by financing activities was $19.5 million for the year ended December 31, 2017 was mainly the result of the net receipt of $17.9 millionfrom the issuance of ordinary shares per the closing of November 16, 2017 securities offering. Net cash provided by financing activities was $22.0 million for the year ended December 31, 2016 was the result of the net receipt of $21.9 million from theissuance of ordinary shares per the closing of June 7, 2016 securities offering. 68 Table of Contents Net cash provided by financing activities was $13.7 million for the year ended December 31, 2015 was the result of the net receipt of $13.6 million from theissuance of ordinary shares per the closing of the November 6, 2015 underwritten offering. Contractual Obligations and Commitments The following tables summarize our contractual obligations and commitments as of December 31, 2017 that will affect our future liquidity: Total Less than 1 Year 1-3 Years 3-5 Years More than 5Years (in thousands) Licenses $360 $120 $240 $— $— Operating Leases 2,652 565 905 692 490 Total $3,012 $685 $1,145 $692 $490 We also have obligations to make future payments to third parties that become due and payable on the achievement of certain development, regulatory andcommercial milestones, such as the start of a clinical trial, filing of an NDA, approval by the FDA or product launch, or royalties upon sale of products. Wehave not included these commitments on our statements of financial position or in the table above because the achievement and timing of these milestones isnot fixed and determinable. These potential future commitments include: ●Agreement with the Contact Research Organization (“CRO”). In January 2015, the Company entered into an agreement with a CROaccording to which it will receive project management, clinical development and other related services from the CRO for the execution ofthe Phase 3 rGBM clinical trial study in consideration for up to $18.7 million. Additional expenses related to changes in the study and inthe estimated services involved were agreed upon and are being negotiated with the CRO during the execution of the study. ThroughDecember 31, 2017, expenses in the total amount of $17.5 million were incurred. ●Agreement with the Contact Research Organization (“CRO”). In December 2017, the Company entered into an agreement with a ContactResearch Organization (“CRO”) according to which it will receive project management, clinical development and other related servicesfrom the CRO for the execution of the Phase 3 study in platinum-resistant ovarian cancer in consideration for approximately $19.0 million.Through December 31, 2017, expenses in the total amount of $400 thousand were incurred. ●Agreement with Tel Hashomer. On February 3, 2013, we entered into an agreement with Tel Hashomer—Medical Research, Infrastructureand Services Ltd., or Tel Hashomer, a private company whose purpose is to promote the welfare of the Sheba Medical Center, or theHospital, and Prof. Dror Harats, our chief executive officer. The agreement with Tel Hashomer resolved claims of the Hospital regarding theownership of certain inventions and patent rights owned by us and developed in part by Prof. Harats and other inventors who were engagedby us and by the Hospital in parallel. The agreement provided us with a waiver of rights by the Hospital and Tel Hashomer in connectionwith intellectual property developed by these inventors prior to the date of the agreement. In consideration for the waiver, we undertook topay 1% of any net sales of any product covered by the intellectual property covered under the agreement, which includes all of our currentproduct candidates, and 2% of any consideration that we receive for granting a license or similar rights to this intellectual property. Suchamounts will be recorded as part of our cost of revenues. In addition, upon the occurrence of an exit event such as a merger, sale of all sharesor assets or the closing of an initial public offering, we are required to pay to Tel Hashomer 1% of the proceeds received by us or ourshareholders as the case may be. In November 2014, following the completion of our IPO, we paid to Tel Hashomer the amount of $0.4million. In November 2017, we entered into a license agreement. For the cash payment received to date in this transaction, we paid TelHashomer an additional $340 thousand royalty and all other payment obligations under this agreement will expire once we have paid anaggregate sum of NIS 100 million (approximately $29 million) to Tel Hashomer by way of pay out, exit proceeds and licensingconsideration. Amounts previously paid as royalties on any net sales will not be taken into account when calculating this aggregate sum. 69 Table of Contents ● Agreement with Crucell. On April 15, 2011, we entered into a Commercial License Agreement with Crucell Holland B.V., or Crucell, forincorporating the adenovirus 5 in VB- 111 and other drug candidates for cancer for consideration including the following potential futurepayments: ■an annual license fee of € 100,000 ($120,000), continuing until the termination of the agreement, which will occur upon (i)the later of the expiration date of the last related patent or 10 years from the first commercial sale of VB-111 or (ii) thetermination of the agreement by us, which is permitted, upon three months’ written advance notice to Crucell; ■a milestone payment of € 400,000 ($480,000) upon receipt of the first regulatory approval for the marketing of the firstindication for each product covered under the agreement; and ■royalties of 0.5%-2.0% on net sales. There are no limits or caps on the amount of potential royalties. Pursuant to the agreement, the Company has the right to terminate the agreement by givingCrucell three months’ written notice. ●Participation by the IIA. We receive grants from the IIA, as part of the oncology and anti-inflammatory research and development programs.The requirements and restrictions for such grants are set forth in the Research Law. These grants are subject to repayment through futureroyalty payments on sales of any products resulting from these research and development programs, including VB-111 and VB-201. Underthe Research Law, we are obligated to pay royalties of 3% to 3.5%. The maximum aggregate royalties paid generally cannot exceed 100%of the grants made to us, plus annual interest generally equal to the 12-month LIBOR applicable to dollar deposits, as published on the firstbusiness day of each calendar year. The total gross amount of grants actually received by us from the IIA as of December 31, 2017 totaledapproximately $22.0 million, and the balance of the principal and interest in respect of our commitments for future payments to the IIAtotaled approximately $26.9 million. As of December 31, 2017, we incurred $510 thousand of royalties to the IIA in connection withupfront and milestone payments received from a license agreement. Off-Balance Sheet Arrangements Since our inception, we have not engaged in any off-balance sheet arrangements, as defined in the rules and regulations of the SEC, such as relationships withunconsolidated entities or financial partnerships, which are often referred to as structured finance or special purpose entities, established for the purpose offacilitating financing transactions that are not required to be reflected on our statements of financial position. Recently Issued and Adopted Accounting Pronouncements IFRS 9, Financial Instruments, addresses the classification, measurement and recognition of financial assets and financial liabilities. The complete version ofIFRS 9 was issued in July 2014. It replaces the guidance in IAS 39 that relates to the classification and measurement of financial instruments. IFRS 9 retainsbut simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortized cost, fair value throughOCI and fair value through P&L. There is now a new expected credit losses model that replaces the incurred loss impairment model used in IAS 39. Forfinancial liabilities, there were no changes to classification and measurement except for the recognition of changes in own credit risk in other comprehensiveincome for liabilities designated at fair value through profit or loss. The standard is effective for accounting periods beginning on or after January 1, 2018.Early adoption is permitted. The Company concluded that IFRS 9 would not have material impact on the financial statements. In January 2016, the IASB issued IFRS 16—Leases which sets out the principles for the recognition, measurement, presentation and disclosure of leases forboth parties to a contract and replaces the previous leases standard, IAS 17—Leases. IFRS 16 eliminates the classification of leases for the lessee as eitheroperating leases or finance leases as required by IAS 17 and instead introduces a single lessee accounting model whereby a lessee is required to recognizeassets and liabilities for all leases with a term that is greater than 12 months, unless the underlying asset is of low value, and to recognize depreciation ofleases assets separately from interest on lease liabilities in the statements of comprehensive loss. As IFRS 16 substantially carries forward the lessoraccounting requirements in IAS 17, a lessor will continue to classify its leases as operating leases or finance leases and to account for those two types ofleases differently. IFRS 16 is effective from January 1, 2019 with early adoption allowed only if IFRS 15—Revenue from Contracts with Customers is alsoapplied. The Company is currently evaluating the impact of adoption on its Financial Statements. As of January 1, 2017, the Company early adopted IFRS 15, with full retrospective application. Since the Company has not generated revenues until 2017,the adoption of IFRS 15 did not have an effect on accumulated deficits as of January 1, 2015 nor on 2015’s and 2016’s comparatives. IFRS 15 introduces a five-step model for recognizing revenue from contracts with customers, as follows: 1.identify the contract with a customer; 2.identify the performance obligations in the contract; 3.determine the transaction price; 4.allocate the transaction price to the performance obligations in the contract; 5.recognize revenue when (or as) the entity satisfies a performance obligation. For more details, refer to Note 8(m). 70 Table of Contents JOBS Act On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, reduce certain reporting requirements for an“emerging growth company.” As an “emerging growth company,” we are electing to not take advantage of the extended transition period afforded by theJOBS Act for the implementation of new or revised accounting standards, and as a result, we will comply with new or revised accounting standards on therelevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decisionto not take advantage of the extended transition period for complying with new or revised accounting standards is irrevocable. Safe Harbor See “Cautionary Note Regarding Forward-Looking Statements” in the introduction to this Annual Report. Item 6. Directors, Senior Management and Employees Executive Officers and Directors The following table sets forth certain information relating to our executive officers and directors, including their ages as of February 1, 2018. Unlessotherwise stated, the address for our directors and executive officers is c/o Vascular Biogenics Ltd., 8 Hasatat St. Modiin, Israel. Name Age PositionExecutive Officers and Director Dror Harats 61 Chief Executive Officer and DirectorAmos Ron 62 Chief Financial Officer and Company SecretaryErez Feige 44 Vice President, Business OperationsYael Cohen 55 Vice President, Clinical DevelopmentEyal Breitbart 51 Vice President, Research and OperationsNaamit Sher 63 Vice President, Drug DevelopmentCorinne Epperly 40 US Chief Operating OfficerAyelet Horn 47 General CounselNon-Executive Directors Bennett M. Shapiro (3)(4) 78 Chairman and DirectorRuth Arnon (1)(3)(4) 85 DirectorJecheskiel Gonczarowski (2)(3)(4) 72 DirectorRuth Alon (3)(4) 66 DirectorRon Cohen (1)(2)(4) 62 DirectorPhilip A. Serlin (1)(2)(4) 57 DirectorSusan L. Kelley, MD 63 DirectorDavid Hastings 56 Director (1)Member of the compensation committee.(2)Member of the audit committee.(3)Member of the nominating and corporate governance committee.(4)Independent director under the rules of the NASDAQ Stock Market. 71 Table of Contents Executive Officers Prof. Dror Harats founded our company in 2000 and has served as our chief executive officer since our inception. He has been a member of our board ofdirectors since January 2001. Prof. Harats is the Chairman of the Bert W. Strassburger Lipid Center and chair of the R&D division at the Chaim ShebaMedical Center at Tel Hashomer and chairman of its Institute Review Board. Prof. Harats received his M.D. from Hadassah Medical School at the HebrewUniversity of Jerusalem, Israel, following which he conducted post-doctoral work at the University of California, San Francisco. Prof. Harats is also a Professorof Medicine in the Departments of Internal Medicine and Biochemistry at the Sackler Faculty of Medicine of Tel-Aviv University, Israel. Prof. Harats has alsoserved as a visiting scientist at Syntax Discovery Research. Prof. Harats currently serves as an observer on the board of directors of Art Healthcare Ltd. Webelieve Prof. Harats is qualified to serve on our board of directors because of his extensive technical and industry experience, as well as his knowledge of ourcompany. Amos Ron has served as our chief financial officer since May 2011. Prior to joining our company, from July 2008 to April 2011, Mr. Ron was the chieffinancial officer of Atlantium Technologies Ltd., a privately held start-up in the field of clean-tech. Prior to that, Mr. Ron served as the chief financial officerand chief operating officer of Medical Compression Systems, and prior to that, Mr. Ron served as the chief financial officer of Interpharm Laboratories Group,a wholly owned subsidiary of Serono S.A. Mr. Ron holds an M.Sc. (Honors) in Chemical Technology Management from the Hebrew University of Jerusalem,a B.Sc. in Business Administration, Empire State College (SUNY) (Jerusalem Branch) and a B.Sc. in Chemistry from the Hebrew University of Jerusalem. Dr. Erez Feige has served as our vice president of business operations since January 2014. Prior to that, from 2012 to 2014, Dr. Feige served as our director ofbusiness development and, from 2006 to 2012, Dr. Feige served as our head of biochemistry. Dr. Feige holds a B.Sc., and M.B.A. and a Ph.D. from Bar-IlanUniversity, Israel and completed a post-doctoral fellowship at the Dana-Farber Cancer Institute and Harvard Medical School. Dr. Yael Cohen has served as our vice president of clinical development since 2008. Prior to joining our company, Dr. Cohen served in various positions inGamida Cell Ltd., Merck & Co. and Merck Research Labs, from 2000 to 2008. Dr. Cohen holds an M.D. from the Sackler Medical School at Tel AvivUniversity, Israel, and completed her residency in internal medicine at the Chaim Sheba Medical Center at Tel Hashomer, Israel, and a fellowship inhematology at the Rabin Medical Center, Petach Tikva, Israel. Dr. Cohen is a senior physician at the Hematology Department at the Sourasky MedicalCenter, Tel Aviv, Israel. Dr. Eyal Breitbart has served as our vice president, research and operations since January 2014. Prior to that, from 2006 to 2013, Dr. Breitbart served as ourvice president, research. Prior to that, Dr. Breitbart served as head of research from 2002 to 2006 and prior to that as project manager from 2001 to 2002. Dr.Breitbart holds a B.Sc., M.Sc. and Ph.D. from Bar-Ilan University, Israel, and completed a post-doctoral fellowship at Tufts University School of Medicine. Dr. Naamit Sher has served as our vice president of drug development and regulatory affairs since 2006. Prior to joining our company, from 2005 to 2006, Dr.Sher was head of QC laboratories, operations division at Teva Pharmaceutical Industries Ltd. From 1992 to 2005, Dr. Sher acted as quality control/qualityassurance director at InterPharm, a subsidiary of Ares- Serono. Dr. Sher holds a B.Sc., M.Sc. and Ph.D. from the Hebrew University of Jerusalem, Israel. Shecompleted post-doctoral fellowships at each of the Hebrew University, Jerusalem, Israel, and Rutgers University. Dr. Corinne Epperly has served as US Chief Operating Officer since June 2017. Previously Dr. Epperly worked across diverse roles at Bristol-Myers Squibb(BMS) spanning marketing, M&A, strategic operations and medical strategy from 2011 to 2017. Most recently she helped lead the preparation for thecommercial launches of OPDIVO® (nivolumab) across multiple indications. From 2009 to 2010, she was a global healthcare research analyst at GoldmanSachs. Dr. Epperly holds an M.D. and Masters of Public Health from the University of North Carolina, Chapel Hill. She completed her medical training at theUniversity of North Carolina Hospitals with the Department of Pediatrics. At the National Cancer Institute, National Institutes of Health, she conductedbiomedical research in Experimental Immunology of Oncology from 2000-2003. Adv. Ayelet Horn has served as our general counsel since our inception in 2000, and has served as our company secretary between 2007-2016. Adv. Hornholds an LL.B from Tel-Aviv University, Israel, and an M.B.A. from Herriot Watt University, Edinburgh, Scotland. 72 Table of Contents Non-Executive Directors Dr. Bennett M. Shapiro, M.D. has served on our board of directors since September 2004 and as Chairman since 2007. In addition to serving on our board ofdirectors, Dr. Shapiro has been a senior partner at Puretech Ventures, an innovation enterprise, since 2004, and as chairman from 2009-2015; he nowcontinues as a Non-Executive Director of PureTech HealthPLC-PRTC. From 1990 to 2003, Dr. Shapiro served as executive vice president, Merck ResearchLaboratories. Prior to that, from 1970 to 1990, Dr. Shapiro was a professor of the Department of Biochemistry at the University of Washington and served aschairman from 1985 to 1990. Prior to joining the University of Washington, from 1965 to 1970 Dr. Shapiro served as a research associate, then section head,in the Laboratory of Biochemistry of the National Heart Institute of the U.S. National Institutes of Health. Dr. Shapiro has served as an external director on theboard of directors of Momenta Pharmaceuticals from 2003-2016, various private companies, and the Drugs for Neglected Diseases Initiative, an independent,non-profit drug development partnership. Dr. Shapiro previously served on the board of directors of Celera Corporation prior to its acquisition by QuestDiagnostics Inc. Dr. Shapiro received his B.S. in chemistry from Dickinson College and his M.D. from Jefferson Medical College. Dr. Shapiro has been aGuggenheim Fellow, a fellow of the Japan Society for the Promotion of Science and a visiting professor at the University of Nice. We believe Dr. Shapiro isqualified to serve on our board of directors because of his extensive technical and industry background, and his experience serving on boards of directors ofcompanies in our industry, including public companies. Prof. Ruth Arnon has served on our board of directors since August 2007. Prof. Arnon is an immunologist with the Weizmann Institute of Science in Israel.Prof. Arnon joined the staff of the Weizmann Institute in 1960, and served as vice president of the Institute from 1988 to 1997. Prof. Arnon is a member of theIsrael Academy of Sciences, and from 2010 until 2015 served as its president. Prof. Arnon is also an elected member of the European Molecular BiologyOrganization. She has served as president of the European Federation of Immunological Societies, and as secretary-general of the International Union ofImmunological Societies. Her awards and honors include the Robert Koch Prize in Medical Sciences, Spain’s Jimenez Diaz Memorial Award, France’s Legionof Honor, the Hadassah World Organization’s Women of Distinction Award, the Wolf Prize for Medicine, the Rothschild Prize for Biology, and the IsraelPrize. Prof. Arnon earned her M.Sc. in Chemistry from the Hebrew University, Jerusalem, Israel, and her Ph.D. from the Hebrew University. We believe Prof.Arnon is qualified to serve on our board of directors because of her extensive technical and industry background. Jecheskiel Gonczarowski has served on our board of directors since March 2001. Since 2010, Mr. Gonczarowski has served as the chairman and chiefexecutive officer of D.S.N.I. Investments Ltd., an Israeli based private family office, managing various local and international investments. Prior to that, Mr.Gonczarowski founded and co-managed Getter Group Ltd, a publicly traded company in Israel specializing in exclusive representation of leadinginternational suppliers and brands, from 1982 to 2010. Mr. Gonczarowski also served on the board of directors of Rotshtein Realestate Ltd., a publicly tradedcompany in Israel performing private and public construction in Israel. Mr. Gonczarowski studied economics, mathematics and business administration at theHebrew University of Jerusalem, Israel. We believe Mr. Gonczarowski is qualified to serve on our board of directors because of his broad business backgroundand experience with public companies. Ruth Alon has served on our board of directors since March 2010. Ms. Alon is currently the founder and CEO of Medstrada. Since 1997 and until December24, 2016, Ms. Alon has served as a general partner in Pitango Venture Capital. Prior to her tenure at Pitango, Ms. Alon held senior positions withMontgomery Securities from 1981 to 1987, Genesis Securities, LLC from 1993 to 1996, and Kidder Peabody & Co. from 1987 to 1993, and managed her ownindependent consulting business in San Francisco in the medical devices industry from 1995 to 1996. Ms. Alon is the chairperson of Israel Life ScienceIndustry, a not-for-profit organization representing the mutual goals of approximately 700 Israeli life science companies. Ms. Alon has a B.A. in Economicsfrom the Hebrew University of Jerusalem, Israel, an M.B.A. from Boston University, and an M.S. from the Columbia University School of Physicians andSurgeons. We believe Ms. Alon is qualified to serve on our board of directors because of her extensive business and industry background, as well as herexperience as a seasoned investor. 73 Table of Contents Dr. Ron Cohen, M.D. joined our board in February 2015. In addition to serving on our board of directors, Dr. Cohen has served as President, Chief ExecutiveOfficer and founder of Acorda Therapeutics, Inc., since 1995. Previously he was a principal in the startup and an officer of Advanced Tissue Sciences, Inc., abiotechnology company engaged in the growth of human organ tissues for transplantation, from 1986 to 1992. Dr. Cohen received his B.A. with honors inPsychology from Princeton University, and his M.D. from the Columbia College of Physicians & Surgeons. He completed his residency in Internal Medicineat the University of Virginia Medical Center, and is Board Certified in Internal Medicine. Dr. Cohen is Chair of the Board of the Biotechnology InnovationOrganization (BIO). He previously served as a Director of Dyax Corporation until the end or 2015, and also previously served as Director and Chair of theNew York Biotechnology Association. He is a recipient of the NY CEO Lifetime Achievement Award and the Ernst & Young Entrepreneur of the Year Awardfor the New York Metropolitan Region, and has been recognized by PharmaVOICE Magazine as one of the 100 Most Inspirational People in theBiopharmaceutical Industry. We believe Dr. Cohen is qualified to serve on our board of directors because of his extensive business and industry background. Philip A. Serlin joined our board in February 2015. In addition to serving on our board of directors, Mr. Serlin is the Chief Executive Officer of BioLineRxLtd., having previously served as its Chief Financial and Operating Officer from 2009 to 2016. Mr. Serlin also previously served as Chief Financial Officer ofTescom Software Systems Testing Ltd., an IT services company which was publicly traded in both Tel Aviv and London. His background also includes seniorpositions at Chiaro Networks Ltd. and at Deloitte, where he was head of the SEC and U.S. Accounting Department at the National Office in Tel Aviv, as wellas seven years at the SEC at its Washington, D.C., headquarters. Mr. Serlin previously served on the Board of Directors of Kitov Pharmaceuticals Ltd. from2013 to 2016, and on the Board of Directors of Vringo, Inc. from 2010 to 2012. Mr. Serlin is a CPA and holds a Master’s degree in Economics and PublicPolicy from The George Washington University. We believe Mr. Serlin is qualified to serve on our board of directors because of his experience servicingpublic companies (including biotech) and his accounting background. Susan L. Kelley, M.D. joined our board in January 2018. Dr. Kelley is an oncologist with extensive experience in drug development and commercialization.Dr. Kelley worked with Bristol-Myers Squibb in Oncology and Immunology drug development from 1987 to 2001. From 2001 to 2008, Dr. Kelley workedwith Bayer Healthcare Pharmaceuticals as Vice President, Global Clinical Development and Therapeutic Area Head – Oncology. From 2008 to 2011, she wasChief Medical Officer of the Multiple Myeloma Research Consortium, Dr. Kelley served as a member of the Board of Directors of Alchemia from 2013-2015,and Cerulean Pharma from 2014-2017. She is currently a Director at ArQule, Immune Design, and Daré Bioscience, all publicly-traded, US-basedbiotechnology companies. Susan Kelley received her M.D. from Duke University School of Medicine and completed oncology training at the Dana-FarberCancer Institute in Boston. She was also a Fellow in Medical Oncology and Pharmacology at Yale University School of Medicine. We believe Dr. Kelley isqualified to serve on our board of directors because of her extensive industry background. David Hastings joined our board in January 2018. Mr. Hastings has more than 18 years of finance, accounting and operations experience in the bio-pharmaceutical industry. He was the Executive Vice President and Chief Financial Officer at Incyte from October 2003 until 2014. Recently he was the ChiefFinancial Officer of Unilife Corporation. From February 2000 to September 2003 Mr. Hastings served as Vice President, Chief Financial Officer and Treasurerof ArQule Inc. Prior to his employment with ArQule, Mr. Hastings was Vice President and Corporate Controller at Genzyme Inc., and Director of Finance atSepracor. David Hastings received his B.A. in Economics at the University of Vermont. He is a member of the Board Director of SCYNEXIS, Inc. and chairs itsAudit Committee. We believe Mr. Hastings is qualified to serve on our board of directors because of his extensive financial and business background. Arrangements Concerning Election of Directors; Family Relationships Our current board of directors consists of nine directors. We are not a party to, and are not aware of, any voting agreements among our shareholders. In addition, there are no family relationships among our executiveofficers and directors. Advisory Boards We established an advisory board with specific expertise in oncology. In addition we have an advisory board comprised of industry experts with significantexperience in the pharmaceutical industry. Head of Scientific Advisory Board—Rachel W. Humphrey, M.D. Oncology Experts Glioblastoma (GBM) Deborah Blumenthal, MD, Tel Aviv Sourasky Medical CenterAndrew J. Brenner, MD, PhD, The University of Texas Health Science CenterNicholas Butowski, MD, University of CaliforniaTimothy Cloughesy, MD, UCLAPatrick Y. Wen, MD, Dana-Farber Cancer Institute Ovarian Cancer Rebecca C. Arend, MD, University of Alabama at BirminghamRobert A. Burger, MD, University of PennsylvaniaThomas Herzog, MD, University of Cincinnati Cancer InstituteBradley J. Monk, MD, FACS, FACOG, Univ. of Arizona& Creighton Univ.Kathleen Moore, MD, University of Oklahoma Health Sciences CenterRichard T. Penson, MD, MRCP, Massachusetts General Hospital Thyroid Cancer Keith Bible, MD, PhD, Mayo Clinic Cancer Center 74 Table of Contents Additional ExpertsRonald Goldblum, M.D.Bonnie Goldman, M.D.John Konz, Ph.D. Compensation of Executive Officers and Directors The aggregate compensation paid by us to our current directors and executive officers, including share based compensation, for the year ended December 31,2017, was $4.4 million. This amount includes any amounts set aside or accrued to provide pension, severance, retirement, annual leave and recuperation orsimilar benefits or expenses. It does not include any business travel, relocation, professional and business association dues and expenses reimbursed to officeholders, and other benefits commonly reimbursed or paid by companies in Israel. The above also includes the provision for bonuses for the year endedDecember 31, 2017 in the amount of $0.4 million. As of December 31, 2017, options and RSU’s to purchase an aggregate of 2,816,259 ordinary sharesgranted to our directors and executive officers were outstanding under the Employee Share Ownership and Option Plan (2000), or the 2000 Plan, and theEmployee Share Ownership and Option Plan (2011), or the 2011 Plan, and the Employee Share Ownership and Option Plan (2014), or the 2014 Plan at aweighted average exercise price of $3.26 per share. Board of Directors Under the Israeli Companies Law, 5759-1999, or the Companies Law, the management of our business is vested in our board of directors. Our board ofdirectors may exercise all powers and may take all actions that are not specifically granted to our shareholders or to management. Our executive officers areresponsible for our day-to-day management and have individual responsibilities established by our board of directors. Our chief executive officer isappointed by, and serves at the discretion of, our board of directors, subject to the employment agreement that we have entered into with him. All otherexecutive officers are also appointed by our board of directors, and are subject to the terms of any applicable employment agreements that we may enter intowith them. Under our amended and restated articles of association, our board of directors must consist of at least three and not more than nine directors, including theexternal directors. Our board of directors currently consists of seven directors, including two directors who were formerly defined as external directors. Ouramended and restated articles of association further provides that external directors are elected according to the special election requirements under theCompanies Law and two of our directors were nominated as external directors in compliance with the Companies Law. Following the adoption by theCompany of certain reliefs provided under the Companies Law, the Company is exempt from the requirement to appoint external directors and theindividuals formerly appointed as external directors continue to serve as part of our board of directors until the end of their term and may be removed fromoffice in the same manner as any other director. We have only one class of directors. The following of our directors were elected in accordance with the terms of our articles of association in effect prior to the initial public offering of our shareson NASDAQ and are nominated for re-election by our shareholders at any consecutive annual general meeting: ●Dr. Shapiro was appointed as an industry expert by a majority of the other directors, a majority that included representatives of our majorshareholders. ●Prof. Harats was entitled to be a board member for so long as Prof. Harats is either (i) the chief executive officer of our company; or (ii) aholder of 3% or more of our issued and outstanding share capital; 75 Table of Contents ●Mr. Gonczarowski was appointed by J.J.D. Holdings G.P., A.J.J.G. Technology Investments 2003 and Inspe Aktiengesellschaft on behalf ofthe holders of the Series A preferred shares; ●Ms. Alon was appointed by persons affiliated with Pitango Venture Capital; and ●Prof. Ruth Arnon was appointed by a majority of the other directors, which included representatives of our major shareholders. Upon the adoption of our amended and restated articles of association upon the closing of our initial public offering, the rights set forth in the previousarticles were terminated and no additional agreements exist with respect to the nomination of our board members. On February 11, 2015, at a general meeting of our shareholders, each of Dr. Ron Cohen and Mr. Philip Serlin was appointed as an external director by amajority of the shareholders who have no personal interest in his nomination for a period of three years. In accordance with the exemption available to certainIsraeli public companies, whose shares are traded on NASDAQ, we chose as of November 7, 2016 not to follow the requirements of Companies Law withregard to the appointment of “external directors” as defined in the Companies Law, and instead, to follow the NASDAQ rules applicable to US domesticcompanies with respect to the appointment of independent directors. Dr. Ron Cohen and Mr. Philip Serlin shall continue to serve as part of our board ofdirectors until the end of their term and may be removed from office in the same manner as any other director. As long as we follow such reliefs, any referenceto the election of our external directors in our amended articles of association shall have no actual expression. We comply with NASDAQ rules that a majority of our directors are independent. Our board of directors has determined that with the exception of Prof. Harats,all of our directors are independent under such rules. In accordance with the exemption available to foreign private issuers under NASDAQ rules, we do not intend to follow the requirements of NASDAQ ruleswith regard to the process of nominating directors, and instead, will follow Israeli law and practice, in accordance with which our board of directors (or acommittee thereof) is authorized to recommend to our shareholders director nominees for election. See “Item 16G. Corporate Governance” for moreinformation. Under the Companies Law and our amended and restated articles of association, nominees for directors may also be proposed by any shareholder holding atleast 1% of our outstanding voting power. However, any such shareholder may propose a nominee only if a written notice of such shareholder’s intent topropose a nominee has been given to our company secretary (or, if we have no such company secretary, our chief executive officer). Any such notice mustinclude certain information, including, among other things, a description of all arrangements between the nominating shareholder and the proposed directornominee(s) and any other person pursuant to which the nomination(s) are to be made by the nominating shareholder, the consent of the proposed directornominee(s) to serve as our director(s) if elected and a declaration signed by the nominee(s) declaring that there is no limitation under the Companies Lawpreventing their election, and that all of the information that is required under the Companies Law to be provided to us in connection with such election hasbeen provided. In addition, our amended and restated articles of association allow our board of directors to appoint directors to fill vacancies on our board of directors, for aterm of office equal to the remaining period of the term of office of the director(s) whose office(s) have been vacated. Under the Companies Law, our board of directors must determine the minimum number of directors who are required to have accounting and financialexpertise (as defined below). In determining the number of directors required to have such expertise, our board of directors must consider, among other things,the type and size of the company and the scope and complexity of its operations. Our board of directors has determined that the minimum number of directorswho are required to have accounting and financial expertise is one. 76 Table of Contents A director with accounting and financial expertise is a director who, due to his or her education, experience and skills, possesses an expertise in, and anunderstanding of, financial and accounting matters and financial statements, such that he or she is able to understand the financial statements of the companyand initiate a discussion about the presentation of financial data. A director is deemed to have professional qualifications if he or she has: (i) an academicdegree in economics, business management, accounting, law or public administration, (ii) an academic degree or has completed other higher education, in theprimary field of business of the company or a field which is relevant to his or her position in the company, or (iii) at least five years of experience serving inone of the following capacities, or at least five years cumulative experience serving in two or more of the following capacities: (a) a senior businessmanagement position in a company with a significant volume of business, (b) a senior position in a company’s primary field of business, or (c) a seniorposition in public administration or service. The board of directors is charged with determining whether a director possesses financial and accountingexpertise or professional qualifications. Our board of directors has determined that Mr. Serlin has accounting and financial expertise as required under the Companies Law. External Directors Under the Companies Law, a public company is required to have at least two directors who qualify as external directors. In accordance with the exemptionavailable to certain Israeli public companies, whose shares are traded on NASDAQ, our board of directors elected not to follow the requirements ofCompanies Law with regard to the appointment of “external directors” as defined in the Companies Law, and instead, to follow the NASDAQ rules applicableto US domestic companies with respect to the appointment of independent directors. The exemption applies as long as the Company has no controllingshareholder, is in compliance with applicable US law and regulations and complies with the NASDAQ rules applicable to US domestic companies withrespect to the appointment of independent directors and to the composition of the compensation and audit committees. Our board may further resolve at anytime that we shall no longer follow the reliefs and in such event we shall be required to appoint two directors as external directors. The Companies Law provides that external directors must be elected by a majority vote of the shares present and voting at a shareholders meeting, providedthat either: ●such majority includes at least a majority of the shares held by all shareholders who are not controlling shareholders and do not have apersonal interest in the election of the external director (other than a personal interest not deriving from a relationship with a controllingshareholder) that are voted at the meeting, excluding abstentions, to which we refer as a disinterested majority; or ●the total number of shares voted against the election of the external director by non- controlling shareholders and by shareholders who donot have a personal interest in the election of the external director (other than a personal interest not deriving from a relationship with acontrolling shareholder does not exceed 2% of the aggregate voting rights in the company). The term “controlling shareholder” is defined in the Companies Law as a shareholder with the ability to direct the activities of the company, other than byvirtue of being an office holder. A shareholder is presumed to be a controlling shareholder if the shareholder holds 50% or more of the voting rights in acompany or has the right to appoint the majority of the directors of the company or its general manager. With respect to certain matters, a controllingshareholder is deemed to include any shareholder that holds 25% or more of the voting rights in a public company if no other shareholder holds more than50% of the voting rights in the company, but excludes a shareholder whose power derives solely from his or her position as a director of the company or fromany other position with the company. The Companies Law provides that a person is not qualified to serve as an external director if (i) the person is a relative of a controlling shareholder of thecompany, or (ii) if that person or his or her relative, partner, employer, another person to whom he or she was directly or indirectly subject, or any entity underthe person’s control, has or had, during the two years preceding the date of appointment as an external director: (a) any affiliation or other disqualifyingrelationship with the company, with any person or entity controlling the company or a relative of such person, or with any entity controlled by or undercommon control with the company; or (b) in the case of a company with no shareholder holding 25% or more of its voting rights, had at the date ofappointment as external director, any affiliation or other disqualifying relationship with a person then serving as chairman of the board or chief executiveofficer, a holder of 5% or more of the issued share capital or voting power in the company or the most senior financial officer. 77 Table of Contents The term “relative” is defined under the Companies Law as a spouse, sibling, parent, grandparent or descendant; spouse’s sibling, parent or descendant; andthe spouse of each of the foregoing persons. Under the Companies Law, the term “affiliation” and the similar types of prohibited relationships include(subject to certain exceptions): ●an employment relationship; ●a business or professional relationship even if not maintained on a regular basis (excluding insignificant relationships); ●control; and ●service as an office holder, excluding service as a director in a private company prior to the initial public offering of its shares if suchdirector were appointed as a director of the private company in order to serve as an external director following the initial public offering. The term office holder is defined under the Companies Law as the general manager, chief executive officer, chief business manager, deputy general manager,vice general manager, any other person assuming the responsibilities of any of these positions regardless of that person’s title, a director, or a managerdirectly subordinate to the general manager. In addition, no person may serve as an external director if that person’s position or professional or other activities create, or may create, a conflict of interestwith that person’s responsibilities as a director or otherwise interfere with that person’s ability to serve as an external director or if the person is an employeeof the Israel Securities Authority or of an Israeli stock exchange. A person may furthermore not continue to serve as an external director if he or she receiveddirect or indirect compensation from the company including amounts paid pursuant to indemnification or exculpation contracts or commitments andinsurance coverage for his or her service as an external director, other than as permitted by the Companies Law and the regulations promulgated thereunder. According to regulations promulgated under the Companies Law, a person may be appointed as an external director only if he or she has professionalqualifications or if he or she has accounting and financial expertise (each, as defined below). In addition, at least one of the external directors must bedetermined by our board of directors to have accounting and financial expertise. However, if at least one of our other directors (i) meets the independencerequirements under the Exchange Act, (ii) meets the standards of the NASDAQ listing rules for membership on the audit committee, and (iii) has accountingand financial expertise as defined under Israeli law, then neither of our external directors is required to possess accounting and financial expertise as long aseach possesses the requisite professional qualifications. A director with accounting and financial expertise is a director who, due to his or her education, experience and skills, possesses an expertise in, and anunderstanding of, financial and accounting matters and financial statements, such that he or she is able to understand the financial statements of the companyand initiate a discussion about the presentation of financial data. A director is deemed to have professional qualifications if he or she has: (i) an academicdegree in economics, business management, accounting, law or public administration, (ii) an academic degree or has completed other higher education, in theprimary field of business of the company or a field which is relevant to his or her position in the company, or (iii) at least five years of experience serving inone of the following capacities, or at least five years cumulative experience serving in two or more of the following capacities: (a) a senior businessmanagement position in a company with a significant volume of business, (b) a senior position in a company’s primary field of business, or (c) a seniorposition in public administration or service. The board of directors is charged with determining whether a director possesses financial and accountingexpertise or professional qualifications. 78 Table of Contents Role of Board in Risk Oversight Process Risk assessment and oversight are an integral part of our governance and management processes. Our board of directors encourages management to promote aculture that incorporates risk management into our corporate strategy and day-to-day business operations. Management discusses strategic and operationalrisks at regular management meetings, and conducts specific strategic planning and review sessions during the year that include a focused discussion andanalysis of the risks facing us. Throughout the year, senior management reviews these risks with the board of directors at regular board meetings as part ofmanagement presentations that focus on particular business functions, operations or strategies, and presents the steps taken by management to mitigate oreliminate such risks. Leadership Structure of the Board In accordance with the Companies Law and our amended and restated articles of association, our board of directors is required to appoint one of its membersto serve as chairman of the board of directors. Our board of directors has appointed Dr. Shapiro to serve as chairman of the board of directors. Committees of the Board of Directors We have an audit committee, a compensation committee and a nominating and corporate governance committee. We have adopted a charter for each of thesecommittees. Audit Committee Under the Companies Law, we are required to appoint an audit committee. The audit committee must be comprised of at least three directors, including all ofthe external directors, one of whom must serve as chairman of the committee. In accordance with the exemption available to certain Israeli public companies,whose shares are traded on NASDAQ, we chose as of November 7, 2016 and for as long the required conditions precedent are met and unless otherwisedecided by our board of directors, not to follow the requirements of Companies Law with regard to the composition of the audit committee, and instead, willfollow the NASDAQ rules applicable to US domestic companies with respect to the appointment and composition of the audit committee. Under the NASDAQ listing requirements, we are required to maintain an audit committee consisting of at least three independent directors, all of whom arefinancially literate and at least one of whom has accounting or related financial management expertise. Our audit committee consists of our two externaldirectors Mr. Serlin and Dr. Cohen, and of Mr. Gonczarowski and is chaired by Mr. Serlin. Mr. Serlin is the audit committee financial expert as defined by theSecurities and Exchange Commission rules and all of the members of our audit committee have the requisite financial literacy as defined by the NASDAQStock Market rules. All the members of our audit committee are “independent” as such term is defined in Rule 10A-3(b)(1) under the Exchange Act and underthe listing standards of NASDAQ. Our board of directors has adopted an audit committee charter setting forth the responsibilities of the audit committee consistent with the rules of theSecurities and Exchange Commission and NASDAQ rules as well as the requirements for such committee under the Companies Law, including the following: ● oversight of our independent registered public accounting firm and recommending the engagement, compensation or termination ofengagement of our independent registered public accounting firm to the board of directors in accordance with Israeli law; 79 Table of Contents ●recommending the engagement or termination of the person filling the office of our internal auditor; and ●recommending the terms of audit and non-audit services provided by the independent registered public accounting firm for pre-approval byour board of directors. Our audit committee provides assistance to our board of directors in fulfilling its legal and fiduciary obligations in matters involving our accounting,auditing, financial reporting, internal control and legal compliance functions by pre-approving the services performed by our independent accountants andreviewing their reports regarding our accounting practices and systems of internal control over financial reporting. Our audit committee also oversees theaudit efforts of our independent accountants and takes those actions that it deems necessary to satisfy itself that the accountants are independent ofmanagement. Under the Companies Law, our audit committee is responsible for: ● determining whether there are deficiencies in our business management practices, including in consultation with our internal auditor or theindependent auditor, and making recommendations to the board of directors to improve such practices; ●determining whether to approve certain related party transactions (including transactions in which an office holder has a personal interest)and whether such transaction is extraordinary or material under the Companies Law (see “—Approval of Related Party Transactions UnderIsraeli Law”); ●where the board of directors approves the work plan of the internal auditor, to examine such work plan before its submission to the boardand propose amendments thereto; ●establishing the approval process for certain transactions with a controlling shareholder or in which a controlling shareholder has a personalinterest; ●examining our internal controls and internal auditor’s performance, including whether the internal auditor has sufficient resources and toolsto dispose of its responsibilities; ●examining the scope of our independent auditor’s work and compensation and submitting a recommendation with respect thereto to ourboard of directors or shareholders, depending on which of them is considering the appointment of our auditor; and ●establishing procedures for the handling of employees’ complaints as to deficiencies in the management of our business and the protectionto be provided to such employees. Our audit committee may not approve any actions requiring its approval (see “—Approval of Related Party Transactions Under Israeli Law”), unless at thetime of approval a majority of the committee’s members are present, which majority consists of unaffiliated directors including at least one external director. Compensation Committee Our compensation committee consists of Mr. Serlin and Dr. Cohen and of Dr. Ruth Arnon. Mr. Serlin serves as the chairman of the compensation committee.The members of our compensation committee are independent under the NASDAQ listing requirements. Under the Companies Law, the board of directors of a public company must appoint a compensation committee. In accordance with the exemption availableto certain Israeli public companies, whose shares are traded on NASDAQ, we chose as of November 7, 2016 and for as long the required conditions precedentare met and unless otherwise decided by our board of directors, not to follow the requirements of Companies Law with regard to the composition of thecompensation committee, and instead, will follow the NASDAQ rules applicable to US domestic companies with respect to the appointment and compositionof the compensation committee. 80 Table of Contents The duties of the compensation committee include the recommendation to our board of directors of a policy regarding the terms of engagement of officeholders, to which we refer as a compensation policy. That policy must be adopted by the company’s board of directors, after considering therecommendations of the compensation committee, and will need to be brought for approval by the company’s shareholders, which approval requires what werefer to as a special majority. A special majority approval requires shareholder approval by a majority vote of the shares present and voting at a meeting ofshareholders called for such purpose, provided that either: (a) such majority includes at least a majority of the shares held by all shareholders who are notcontrolling shareholders and do not have a personal interest in such compensation arrangement; or (b) the total number of shares of non-controllingshareholders and shareholders who do not have a personal interest in the compensation arrangement and who vote against the arrangement does not exceed2% of the company’s aggregate voting rights. On May 27, 2015 our shareholders approved our compensation policy. Our compensation policy must serve as the basis for decisions concerning the financial terms of employment or engagement of office holders, includingexculpation, insurance, indemnification or any monetary payment or obligation of payment in respect of employment or engagement. The compensationpolicy must relate to certain factors, including advancement of the company’s objectives, the company’s business plan and its long term strategy, andcreation of appropriate incentives for office holders. It must also consider, among other things, the company’s risk management, size and nature of itsoperations. The term office holder is defined under the Companies Law as the general manager, chief executive officer, chief business manager, deputygeneral manager, vice general manager, any other person assuming the responsibilities of any of these positions regardless of that person’s title, a director, ora manager directly subordinate to the general manager. The compensation policy must furthermore consider the following additional factors: ●the knowledge, skills, expertise, and accomplishments of the relevant office holder; ●the office holder’s roles and responsibilities and prior compensation agreements with him or her; ●the relationship between the terms offered and the average compensation of the other employees of the company, including those employedthrough manpower companies; ●the impact of disparities in salary upon work relationships in the company; ●the possibility of reducing variable compensation at the discretion of the board of directors; ●the possibility of setting a limit on the exercise value of non-cash variable equity-based compensation; and ●as to severance compensation, the period of service of the office holder, the terms of his or her compensation during such service period, thecompany’s performance during that period of service, the person’s contributions towards the company’s achievement of its goals and themaximization of its profits, and the circumstances under which the person is leaving the company. The compensation policy must also include the following principles: ●the link between variable compensation and long term performance and measurable criteria; ●the relationship between variable and fixed compensation, and the ceiling for the value of variable compensation; ●the conditions under which an office holder would be required to repay compensation paid to him or her if it was later shown that the dataupon which such compensation was based was inaccurate and was required to be restated in the company’s financial statements; ●the minimum holding or vesting period for variable, equity-based compensation; and ●maximum limits for severance compensation. 81 Table of Contents The compensation committee is responsible for (a) recommending the compensation policy to a company’s board of directors for its approval (andsubsequent approval by its shareholders) and (b) duties related to the compensation policy and to the compensation of a company’s office holders as well asfunctions previously fulfilled by a company’s audit committee with respect to matters related to approval of the terms of engagement of office holders,including: ●recommending whether a compensation policy should continue in effect, if the then- current policy has a term of greater than three years(approval of either a new compensation policy or the continuation of an existing compensation policy must in any case occur every threeyears); ●recommending to the board of directors periodic updates to the compensation policy; ●assessing implementation of the compensation policy; and ●determining whether the compensation terms of the chief executive officer of the company need not be brought to approval of theshareholders. Our board of directors has adopted a compensation committee charter setting forth the responsibilities of the committee, which include: ●the responsibilities set forth in the compensation policy; ●reviewing and approving the granting of options and other incentive awards to the extent such authority is delegated by our board ofdirectors; and ●reviewing, evaluating and making recommendations regarding the compensation and benefits for our non-employee directors. Nominating and Corporate Governance Committee Our nominating and corporate governance committee consists of Dr. Shapiro, Mr. Gonczarowski, Ms. Alon and Dr. Arnon, and is chaired by Dr. Shapiro. Eachof the members of our nominating and corporate governance committee are independent under the listing requirements of The NASDAQ Global Market. Our board of directors has adopted a nominating and governance committee charter sets forth the responsibilities of the nominating and governancecommittee which include: ●overseeing and assisting our board in reviewing and recommending nominees for election as directors; ●assessing the performance of the members of our board; and ●establishing and maintaining effective corporate governance policies and practices, including, but not limited to, developing andrecommending to our board a set of corporate governance guidelines applicable to our company. Internal Auditor Under the Companies Law, the board of directors of a public company must appoint an internal auditor based on the recommendation of the audit committee.The role of the internal auditor is to examine, among other things, our compliance with applicable law and orderly business procedures. The audit committeeis required to oversee the activities and to assess the performance of the internal auditor as well as to review the internal auditor’s work plan. Our internalauditor is Ms. Orit Gal from Ernst & Young Israel. An internal auditor may not be: ●a person (or a relative of a person) who holds more than 5% of the company’s outstanding shares or voting rights; 82 Table of Contents ●a person (or a relative of a person) who has the power to appoint a director or the general manager of the company; ●an office holder or director of the company; or ●a member of the company’s independent accounting firm, or anyone on its behalf. Approval of Related Party Transactions Under Israeli Law Fiduciary Duties of Directors and Executive Officers The Companies Law codifies the fiduciary duties that office holders owe to a company. Each person listed in the table under “Management—ExecutiveOfficers and Directors” is an office holder under the Companies Law. An office holder’s fiduciary duties consist of a duty of care and a duty of loyalty. The duty of care requires an office holder to act with the level of care withwhich a reasonable office holder in the same position would have acted under the same circumstances. The duty of loyalty requires that an office holder act ingood faith and in the best interests of the company. The duty of care includes a duty to use reasonable means to obtain: ●information on the advisability of a given action brought for his or her approval or performed by virtue of his or her position; and ●all other important information pertaining to these actions. The duty of loyalty includes a duty to: ●refrain from any conflict of interest between the performance of his or her duties to the company and his or her other duties or personalaffairs; ●refrain from any activity that is competitive with the company; ●refrain from exploiting any business opportunity of the company to receive a personal gain for himself or herself or others; and ●disclose to the company any information or documents relating to the company’s affairs which the office holder received as a result of his orher position as an office holder. Disclosure of Personal Interests of an Office Holder and Approval of Certain Transactions The Companies Law requires that an office holder promptly disclose to the company any personal interest that he or she may be aware of and all relatedmaterial information or documents concerning any existing or proposed transaction by the company. An interested office holder’s disclosure must be madepromptly and in any event no later than the first meeting of the board of directors at which the transaction is considered. An office holder is not obliged todisclose a personal interest if it derives solely from the personal interest of his or her relative in a transaction that is not considered as an extraordinarytransaction. A “personal interest” is defined under the Companies Law to include a personal interest of any person in an act or transaction of a company, including thepersonal interest of such person’s relative or of a corporate body in which such person or a relative of such person is a 5% or greater shareholder, director orgeneral manager or in which he or she has the right to appoint at least one director or the general manager, but excluding a personal interest stemming fromone’s ownership of shares in the company. A personal interest furthermore includes the personal interest of a person for whom the office holder holds a voting proxy or the personal interest of the officeholder with respect to his or her vote on behalf of a person for whom he or she holds a proxy even if such shareholder has no personal interest in the matter.An office holder is not, however, obliged to disclose a personal interest if it derives solely from the personal interest of his or her relative in a transaction thatis not considered an extraordinary transaction. 83 Table of Contents Under the Companies Law, an extraordinary transaction is defined as any of the following: ●a transaction other than in the ordinary course of business; ●a transaction that is not on market terms; or ● a transaction that may have a material impact on the company’s profitability, assets or liabilities. If it is determined that an office holder has a personal interest in a transaction, approval by the board of directors is required for the transaction, unless thecompany’s articles of association provide for a different method of approval. Further, so long as an office holder has disclosed his or her personal interest in atransaction, the board of directors may approve an action by the office holder that would otherwise be deemed a breach of duty of loyalty. However, acompany may not approve a transaction or action that is adverse to the company’s interest or that is not performed by the office holder in good faith. Anextraordinary transaction in which an office holder has a personal interest requires approval first by the company’s audit committee and subsequently by theboard of directors. The compensation of, or an undertaking to indemnify or insure, an office holder who is not a director requires approval first by thecompany’s compensation committee, then by the company’s board of directors, and, if such compensation arrangement or an undertaking to indemnify orinsure is inconsistent with the company’s stated compensation policy or if the office holder is the chief executive officer (apart from a number of specificexceptions), then such arrangement is subject to a special majority approval. Arrangements regarding the compensation, indemnification or insurance of adirector require the approval of the compensation committee, board of directors and shareholders by ordinary majority, in that order, and under certaincircumstances, a special majority approval. If shareholders of a company do not approve the compensation terms of office holders, other than directors, butincluding the chief executive officer, the compensation committee and board of directors may override the shareholders’ decision, subject to certainconditions. Generally, a person who has a personal interest in a matter which is considered at a meeting of the board of directors or the audit committee may not bepresent at such a meeting or vote on that matter unless the chairman of the relevant committee or board of directors (as applicable) determines that he or sheshould be present in order to present the transaction that is subject to approval. If a majority of the members of the audit committee or the board of directors(as applicable) has a personal interest in the approval of a transaction, then all directors may participate in discussions of the audit committee or the board ofdirectors (as applicable) on such transaction and the voting on approval thereof, but shareholder approval is also required for such transaction. Disclosure of Personal Interests of Controlling Shareholders and Approval of Certain Transactions Pursuant to Israeli law, the disclosure requirements regarding personal interests that apply to directors and executive officers also apply to a controllingshareholder of a public company. See “—Major Shareholders and Related Party Transactions” for a definition of controlling shareholder. In the context of atransaction involving a shareholder of the company, a controlling shareholder also includes a shareholder who holds 25% or more of the voting rights in thecompany if no other shareholder holds more than 50% of the voting rights in the company. For this purpose, the holdings of all shareholders who have apersonal interest in the same transaction will be aggregated. The approval of the audit committee, the board of directors and a special majority, in that order,is required for (a) extraordinary transactions with a controlling shareholder or in which a controlling shareholder has a personal interest, (b) the engagementwith a controlling shareholder or his or her relative, directly or indirectly, for the provision of services to the company, (c) the terms of engagement andcompensation of a controlling shareholder or his or her relative who is not an office holder or (d) the employment of a controlling shareholder or his or herrelative by the company, other than as an office holder. 84 Table of Contents To the extent that any such transaction with a controlling shareholder is for a period extending beyond three years, approval is required once every threeyears, unless, with respect to certain transactions, the audit committee determines that the duration of the transaction is reasonable given the circumstancesrelated thereto. Arrangements regarding the compensation, indemnification or insurance of a controlling shareholder in his or her capacity as an office holder require theapproval of the compensation committee, board of directors and shareholders by a special majority and the terms thereof may not be inconsistent with thecompany’s stated compensation policy. Pursuant to regulations promulgated under the Companies Law, certain transactions with a controlling shareholder or his or her relative, or with directors, thatwould otherwise require approval of a company’s shareholders may be exempt from shareholder approval upon certain determinations of the audit committeeand board of directors. Under these regulations, a shareholder holding at least 1% of the issued share capital of the company may require, within 14 days ofthe publication of such determinations, that despite such determinations by the audit committee and the board of directors, such transaction will requireshareholder approval under the same majority requirements that would otherwise apply to such transactions. Employment Agreements with Executive Officers and Directors We have entered into written employment agreements with each of Dror Harats, Erez Feige, Amos Ron, Yael Cohen, Eyal Breitbart and Naamit Sher. All suchagreements contain provisions regarding non-competition, confidentiality of information and assignment of inventions. The non-competition provisionsapply for a period of 24 months following termination of the respective officer’s employment. In addition, we are required to provide notice of between threeand six months prior to terminating the employment of such executive officers other than in the case of a termination for cause. Other than with respect toProf. Harats, these agreements do not provide for benefits upon the termination of these executives’ respective employment with us, other than payment ofsalary and benefits during the required notice period for termination of these agreements, which varies under these individual agreements. Prof. Harats’sagreement provides for six months of severance in the event Prof. Harats’s employment is terminated by us without cause or terminated by Prof. Harats forgood reason. Pursuant to his employment agreement, “Cause” means Prof. Harats’s conviction of any felony related to our business, a serious breach of trustby Prof. Harats, including theft, embezzlement of our funds, self-dealing, prohibited disclosure of confidential or proprietary information and Prof. Harats’sengagement in any prohibited business competitive to our own, Prof. Harats’s disregard of lawful instructions of our board of directors with respect to hisduties to us following notice, or Prof. Harats’s willful failure to perform any of his fundamental functions or duties. Pursuant to his employment agreement,“Good reason” means a material reduction in Prof. Harats’s status, title, position or responsibilities, a reduction in Prof. Harats’s salary which is not part of ageneral reduction in salary applicable to all of our employees, a failure by us to continue any material compensation or benefit plan, program or practice inwhich Prof. Harats is participating, or a material breach by us of any provision of Prof. Harats’s employment agreement. In addition, we have entered into compensation agreements with certain of our directors. The amounts payable pursuant to these arrangements have beenapproved by our board of directors and shareholders. Our directors do not receive compensation for their service as our directors or otherwise, unless such compensation is approved by our compensationcommittee, and then by the board of directors followed by the shareholders. The compensation of our directors may be fixed, as an all-inclusive payment or aspayment for participation in meetings, or as a combination thereof. In addition, such compensation may include: (i) in the case of a director who is also anofficer, a salary or other compensation in respect of his or her work as an officer, as may be agreed upon by the director and us; and (ii) reimbursement ofexpenses, including travel expenses, expended in connection with his or her duties as a member of the board of directors. 85 Table of Contents Employees As of March 1, 2018, we employed 37 employees, including 30 in research and development, and 7 in general and administrative positions, and of which 14employees have either MDs or PhDs. All of our employees are located in Israel. We believe our employee relations are good. Israeli labor laws govern the length of the workday, minimum wages for employees, procedures for hiring and dismissing employees, determination ofseverance pay, annual leave, sick days, advance notice of termination of employment, equal opportunity and anti- discrimination laws and other conditionsof employment. Subject to specified exceptions, Israeli law generally requires severance pay upon the retirement, death or dismissal of an employee, andrequires us and our employees to make payments to the National Insurance Institute, which is similar to the U.S. Social Security Administration. Ouremployees have defined benefit pension plans that comply with the applicable Israeli legal requirements. None of our employees currently work under any collective bargaining agreements. Share Ownership For information regarding the share ownership of our directors and executive officers, please refer to “—Equity Compensation Plans” below and “Item 7.Major Shareholders and Related Party Transactions—Major Shareholders.” As of March 1, 2018, our directors and executive officers hold, in the aggregate, options, warrants and RSU’s outstanding for 2,976,191 ordinary shares.These options have an average exercise price of $3.39 per share and have expiration dates generally twenty years after the grant date of the option. 1,693,417 options and warrants are exercisable as of March 1, 2018 and have a weighted average exercise price of $2.82 per share. Equity Compensation Plans The 2000 Plan, the 2011 Plan and the 2014 Plan, allow us to grant options to purchase our ordinary shares to our directors, officers, employees, consultants,advisers and service providers. The option plans are intended to enhance our ability to attract and retain desirable individuals by increasing their ownershipinterests in us. We no longer intend to grant options under the 2000 Plan or the 2011 Plan, and the remaining shares reserved for future grants under theoption plans will constitute the initial share reserve for the 2014 Plan. Additionally, upon the expiration of options granted under the 2000 Plan or the 2011Plan, the ordinary shares underlying such expired options will increase the pool reserved for allocation under the 2014 Plan. As of March 1, 2018, we hadreserved an aggregate of 5,411,649 ordinary shares under the option plans. As of March 1, 2018, options to purchase an aggregate of 4,132,163 ordinaryshares were outstanding and options to purchase 553,949 ordinary shares had been exercised. The plans are designed to reflect the provisions of the Israeli Income Tax Ordinance [New Version]—1961, as amended, mainly Sections 102 and 3(i), of theOrdinance, which affords certain tax advantages to Israeli employees, officers and directors that are granted options in accordance with its terms. Section 102 of the Ordinance allows employees, directors and officers, who are not controlling shareholders and who are Israeli residents, to receive favorabletax treatment for compensation in the form of shares or options. Section 102 of the Ordinance includes two alternatives for tax treatment involving theissuance of options or shares to a trustee for the benefit of the grantees and also includes an additional alternative for the issuance of options or shares directlyto the grantee. Section 102(b)(2) of the Ordinance, which provides the most favorable tax treatment for grantees, permits the issuance to a trustee under the“capital gains track.” In order to comply with the terms of the capital gains track, all options granted under a specific plan and subject to the provisions ofSection 102 of the Ordinance, as well as the shares issued upon exercise of such options and other shares received following any realization of rights withrespect to such options, such as share dividends and share splits, must be registered in the name of a trustee selected by the board of directors and held in trustfor the benefit of the relevant employee, director or officer. The trustee may not release these options or shares to the relevant grantee before the secondanniversary of the registration of the options in the name of the trustee. However, under this track, we are not allowed to deduct an expense with respect to theissuance of the options or shares. Section 3(i) does not provide for a similar tax benefits. 86 Table of Contents The plans may be administered by our board of directors either directly or upon the recommendation of a committee appointed by our board of directors. The compensation committee recommends to the board of directors, and the board of directors determines or approves the eligible individuals who receiveoptions under the plans, the number of ordinary shares covered by those options, the terms under which such options may be exercised, and other terms andconditions of the options, all in accordance with the provisions of the plans. Option holders may not transfer their options except in the event of death or ifthe compensation committee determines otherwise. Our compensation committee or board of directors may at any time amend or terminate each of the plans;however, any amendment or termination may not adversely affect any options or shares granted under such plan prior to such action. The option exercise price is determined by the compensation committee and specified in each option award agreement. In general, the option exercise price isthe fair market value of the shares on the date of grant as determined in good faith by our board of directors. Employee Share Ownership and Option Plan (2014) In June 2014, we adopted and obtained shareholder approval for our 2014 Plan and the U.S. Appendix thereto. The 2014 Plan provides for the grant ofoptions, restricted shares, restricted share units and other share- based awards to our directors, employees, officers, consultants, advisors and service providers,among others and to any other person whose services are considered valuable to us. Following the approval of the 2014 Plan by the Israeli tax authorities, wewill only grant options or other equity incentive awards under the 2014 Plan, although previously-granted options and awards will continue to be governedby our 2000 Plan and 2011 Plan. The initial reserved pool under the 2014 Plan was 928,288 ordinary shares, and was adjusted as set forth in the 2014 Plan,including an automatic annual increase on January 1 of each year such that the number of shares issuable under the 2014 Plan will equal 4% of our issuedand outstanding share capital on a fully diluted basis on each such January 1, or a lesser number of shares determined by the board of directors. As of March1, 2018, the outstanding reserved pool under the 2014 Plan stands on 1,279,486. The 2014 Plan is administered by our board of directors or by a committee designated by the board of directors, which shall determine, subject to Israeli law,the grantees of awards and the terms of the grant, including, exercise prices, vesting schedules, acceleration of vesting and the other matters necessary in theadministration of the 2014 Plan. The 2014 Plan enables us to issue awards under various tax regimes including, without limitation, pursuant to Sections 102and 3(i) of the Ordinance, and under Section 422 of the Code. Options granted under the 2014 Plan to U.S. residents may qualify as “incentive stock options”within the meaning of Section 422 of the Code, or may be non-qualified. The exercise price for “incentive stock options” must not be less than the fair marketvalue on the date on which an option is granted, or 110% of the fair market value if the option holder holds more than 10% of our share capital. We currently intend to grant awards under the 2014 Plan only to our employees, directors and officers who are not controlling shareholders and areconsidered Israeli residents, under the capital gains track of Section 102(b)2 of the Ordinance. 87 Table of Contents Awards under the 2014 Plan may be granted until June 8, 2034, 20 years from the date on which the 2014 Plan was approved by our board of directors,provided that awards granted to any U.S. participants may be granted until June 8, 2024, 10 years from the date on which the 2014 Plan was approved by ourboard of directors. The options granted under the 2014 Plan generally vest over four years commencing on the date of grant such that 50% vest on the second anniversary of thedate of grant and an additional 6.25% vest at the end of each subsequent three-month period thereafter for 24 months. Options, other than certain incentiveshare options, that are not exercised within 20 years from the grant date expire, unless otherwise determined by our board of directors or its designatedcommittee, as applicable. Share options that qualify as “incentive stock options” granted to a person holding more than 10% of our voting power under theU.S. appendix to the 2014 Plan will expire within five years from the date of the grant and any other options granted under the U.S. appendix to the 2014Plan will expire within 10 years from the date of grant. Except as otherwise determined by the board of directors or as set forth in an individual’s awardagreement, in the event of termination of employment or services for reasons of disability or death, or retirement, the grantee, or in the case of death, his or herlegal successor, may exercise options that have vested prior to termination within a period of one year from the date of disability or death, or within 180 daysfollowing retirement. If we terminate a grantee’s employment or service for cause, all of the grantee’s vested and unvested options will expire on the date oftermination. If a grantee’s employment or service is terminated for any other reason, the grantee may exercise his or her vested options within 90 days of thedate of termination. Any expired or unvested options return to the pool for reissuance. In the event of a merger or consolidation of our company, or a sale of all, or substantially all, of our shares or assets or other transaction having a similar effecton us, then without the consent of the option holder, our board of directors may determine, at its absolute discretion, whether outstanding awards held by orfor the benefit of any grantee and which have not yet vested, is to be assumed or substituted and whether acceleration of such awards will be available. Employee Share Ownership and Option Plan (2011) In April 2011, we adopted the 2011 Plan. The term of the 2011 Plan is twenty years. Each option granted under the 2011 Plan entitles the grantee to purchaseour ordinary shares. The options granted under the 2011 Plan generally vest during a four-year period following the date of the grant in 13 installments: 25%of the options vest one year following the grant date, and additional 1/16 of the options vest at the end of each subsequent quarter over the course of thefollowing three years. The options expire twenty years after the date of grant if not exercised earlier. In the case of certain changes in our share capital structure, such as a consolidation or share split or dividend, appropriate adjustments will be made to thenumbers of shares and exercise prices under outstanding options. Unless otherwise determined by the board of directors, upon the consummation of certainkinds of transactions, such as a liquidation, a merger, reorganization or sale of all or substantially all of our assets, any unexercised outstanding options shallexpire, provided that in case of merger or consolidation or the sale, transfer or exchange of all or substantially all our assets or shares, the survivingcorporation does not assume the options or substitute them with appropriate options in the surviving corporation. In general, when an option holder’s employment or service with us terminates, his or her option will no longer continue to vest following termination, and theholder may exercise any vested options for a period of 90 days following termination without cause. If an option holder’s employment with us terminates dueto disability (as determined by the board of directors) or if the termination of employment results from his or her death then the option holder or his or herestate (as applicable) has twelve months to exercise the option. If an option holder retires from our company, then, with the approval of the board of directors,the option holder or his or her estate (as applicable) has six months to exercise the option. If termination of employment results from cause, his or heroutstanding options will expire upon termination. No option may be exercised after its scheduled expiration date. 88 Table of Contents Employee Share Ownership and Option Plan (2000) In February 2000, we adopted the 2000 Plan, which was amended and restated in 2003 due to changes in applicable tax law. The original term of the 2000Plan was ten years. In 2013, the terms of outstanding options were extended by 10 years. Each option granted under the 2000 Plan entitles the grantee to purchase one of our ordinary shares. The options granted under the 2000 Plan generally vestduring a four-year period following the date of the grant in three installments: 50% of the options vest two years following the grant date, 25% of the optionsvest three years following the grant date and the remaining 25% of the options vest four years following the grant date. The options under the plan expire tenyears after the date of grant if not exercised earlier. In the case of certain changes in our share capital structure, such as a consolidation or share split or dividend, appropriate adjustments will be made to thenumbers of shares and exercise prices under outstanding options. In the event of certain transactions, such as an acquisition, or a merger or reorganization or asale of all or substantially all of our assets, there shall be an acceleration of exercise of unvested options, immediate or otherwise, which depends on, amongother things, the nature of such transaction, and provided that in case of merger or consolidation the surviving corporation does not assume the options orsubstitute them with appropriate options in the surviving corporation. In general, when an option holder’s employment or service with us terminates, his or her option will no longer continue to vest following termination, and theholder may exercise any vested options for a period of 90 days following termination without cause. If an option holder’s employment with us terminates dueto disability (as determined by the board of directors) or if the termination of employment results from his or her death or due to retirement after age 60, thenwith the approval of the board of directors, the option holder or his or her estate (as applicable) has twelve months to exercise the option; however, the optionmay not be exercised after its scheduled expiration date. If termination of employment results from cause, his or her outstanding options will expire upontermination. Item 7. Major Shareholders and Related Party Transactions Major Shareholders The following table sets forth information with respect to the beneficial ownership of our ordinary shares as of February 11, 2018: ●each person or entity known by us to own beneficially more than 5% of our outstanding ordinary shares; ●each of our executive officers and directors individually; and ●all of our executive officers and directors as a group. The beneficial ownership of our ordinary shares is determined in accordance with the rules of the SEC and generally includes any shares over which aperson exercises sole or shared voting or investment power, or the right to receive the economic benefit of ownership. For purposes of the table below, wedeem ordinary shares issuable pursuant to options that are currently exercisable or exercisable within 60 days of February 11, 2018 to be outstanding and tobe beneficially owned by the person holding the options for the purposes of computing the percentage ownership of that person, but we do not treat them asoutstanding for the purpose of computing the percentage ownership of any other person. The percentage of ordinary shares beneficially owned is based on29,897,323 ordinary shares outstanding as of February 11, 2018. According to our transfer agent, as of February 23, 2018 there were 12 record holders of our ordinary shares, of which two record holders were located inthe United States. None of our shareholders has different voting rights from other shareholders. 89 Table of Contents Except as described in the footnotes below, we believe each shareholder has voting and investment power with respect to the ordinary shares indicated inthe table as beneficially owned. Unless otherwise indicated, the address of each beneficial owner is c/o Vascular Biogenics Ltd., 8 HaSatat St., Modi’in, Israel7178106. Name Number of Ordinary SharesBeneficially Owned Percentage of Ownership 5% Shareholders Thai Lee Family Trust 5,266,076 17.6%Aurum Ventures M.K.I. Ltd (1) 4,254,778 14.2%Persons affiliated with Pitango Ventures (2) 1,658,630 5.6%Mr. Jecheskiel Gonczarowski (3) 2,137,732 7.2%Executive Officers and Directors Dr. Bennett M. Shapiro (4) 284,122 1.0%Prof. Dror Harats (5) 1,673,490 5.4%Mr. Jecheskiel Gonczarowski (6) 2,137,732 7.2%Prof. Ruth Arnon — * Ms. Ruth Alon — — Dr. Ron Cohen — * Mr. Philip Serlin — * Mr. Amos Ron — * Dr. Yael Cohen — * Dr. Erez Feige — * Dr. Eyal Breitbart — * Dr. Naamit Sher — * Adv. Ayelet Horn — * All directors and executive officers as a group (7) 4,738,994 14.95% *Less than 1% (1)Consists of 4,254,778 shares held by Aurum Ventures M.K.I. Ltd. Voting and investment power over such shares are vested with Mr. Morris Kahn, whocontrols Aurum Ventures M.K.I. Ltd. As such, Mr. Kahn may be deemed to have beneficial ownership over our shares held by Aurum Ventures M.K.I.Ltd. The address of Aurum Ventures M.K.I. Ltd. is 16 Abba Hillel Silver Rd., Ramat Gan, 5250608, Israel. (2)Consists of 1,623,570 shares held by Pitango Venture Capital Fund IV L.P. and 35,060 shares held by Pitango Venture Capital Principals Fund IV L.P.(collectively, the “Pitango Funds”). The Pitango Funds are managed by their sole general partner, Pitango V.C. Fund IV, L.P., the sole general partner ofwhich is Pitango G.P. Capital Holdings Ltd., an Israeli company owned indirectly (through personal holding entities) by each of the followingindividuals: Rami Kalish, Chemi J. Peres, Aaron Mankovski, Isaac Hillel, Rami Beracha and Zeev Binman, none of whom has sole voting or investmentpower of our shares and each of whom has shared voting and investment power of such shares. Ms. Alon is a General Partner of Pitango Ventures IVL.P., but does not have sole or shared voting or investment power over the shares held by the Pitango Funds. The address of the Pitango Funds is 11HaMenofim Street, Building B, Herzliya, Israel 46725. (3)Consists of 1,473,174 shares held directly by Mr. Jecheskiel Gonczarowski, 587,774 shares held by D.S.N.I. Investments Ltd. and 76,784 shares held byInspe Aktiengesellschaft (collectively, the “J.J.D. Funds”). The shares held by D.S.N.I. Investments Ltd. and Inspe Aktiengesellschaft may be deemed tobe beneficially owned by Jecheskiel Gonczarowski, our shareholder and director. (4)Consists of (a) 24,440 outstanding shares held by Puretech Ventures LLC, which may be deemed to be beneficially owned by Bennett M. Shapiro, ourchairman and a senior partner and chairman of Puretech Ventures LLC; (b) 42,808 outstanding shares held by Bennett M. Shapiro and Fredericka F.Shapiro, JTWROS; and (c) options to purchase 216,874 shares exercisable within 60 days of February 11, 2018 held by Bennett M. Shapiro. 90 Table of Contents (5)Consists of (a) 691,711 outstanding shares held by or for Prof. Harats; (b) options to purchase 949,847 shares exercisable within 60 days of February 11,2018; and (c) warrants exercisable for 31,932 shares within 60 days of February 11, 2018. (6)Consists of 664,558 shares held by D.S.N.I. Investments Ltd. and Inspe Aktiengesellschaft. These shares may be deemed to be beneficially owned byJecheskiel Gonczarowski, our shareholder and director. In addition, this number consists of 1,473,174 shares held directly by Mr. JecheskielGonczarowski. (7)Consists of (a) options to purchase 1,661,485 shares exercisable within 60 days of February 11, 2018; (b) warrants exercisable for 31,932 shares within60 days of February 11, 2018; and (c) 3,045,577 outstanding shares. Related Party Transactions The following is a description of the material terms of those transactions with related parties to which we are party since January 1, 2017. We have adopted a written policy which provides that the approval of the audit committee is required to effect specified actions and transactions with ourdirectors, executive officers and controlling shareholders, or in which such persons have an interest. See “Item 6. Directors, Senior Management andEmployees—Approval of Related Party Transactions Under Israeli Law.” The term “controlling shareholder” means a shareholder with the ability to directthe activities of our company, other than by virtue of being an executive officer or director. A shareholder is presumed to be a controlling shareholder if theshareholder holds 50% or more of the voting rights in a company or has the right to appoint the majority of the directors of the company or its generalmanager. For the purpose of approving transactions with controlling shareholders, as well as corporate approval of executive compensation, the term alsoincludes any shareholder (or two or more shareholders having a personal interest in the same matter being brought for approval) that holds 25% or more of thevoting rights of a company if the company has no shareholder that owns more than 50% of its voting rights. The transactions described below were enteredinto prior to the effectiveness of this policy. Indemnification Agreements We have in place indemnification agreements with each of our executive officers exculpating them from a breach of their duty of care to us to the fullestextent permitted by law, subject to limited exceptions, and undertaking to indemnify them to the fullest extent permitted by Israeli law, subject to limitedexceptions, including with respect to liabilities resulting from the initial public offering to the extent such liabilities are not covered by insurance. Employment Agreements We have entered into employment agreements with our executive officers and key employees. The employment agreements contain standard provisions,including assignment of invention provisions and non-competition clauses. See “Item 6. Directors, Senior Management and Employees—EmploymentAgreements with Executive Officers.” Registration Rights Agreement Our investor rights agreement entitles our preferred shareholders to certain registration rights following the closing of our initial public offering. Inaccordance with this agreement, and subject to conditions described below, the following executives, directors and entities, which as of the date of theprospectus relating to the initial public offering beneficially owned more than 5% of our ordinary shares are entitled to registration rights: JecheskielGonczarowski and entity affiliated therewith, Thai Lee Family Trust, Aurum Ventures and Pitango Ventures. Form F-1 Demand Rights. Upon the request of the holders of more than 50% of the shares held by our former preferred shareholders given more than 180 daysafter the effective date of the registration statement related to our initial public offering, we are required to file a registration statement on Form F-1 in respectof the ordinary shares held by our former preferred shareholders. Following a request to effect such a registration, we are required to give notice of the requestto the other holders of registrable securities and offer them an opportunity to include their shares in the registration statement. We are not required to effectmore than two registrations on Form F-1 in the aggregate and not more than one registration in any 12 month period and we are only required to do so if theaggregate proceeds from any such registration are estimated in good faith to be in excess of $6.0 million. 91 Table of Contents Form F-3 Demand Rights. After we become eligible under applicable securities laws to file a registration statement on Form F-3, which will not be until atleast 12 months after the date of initial public offering, upon the request of the holders of more than 20% of the shares held by our former preferredshareholders, we are required to file a registration statement on Form F-3 in respect of the ordinary shares held by our former preferred shareholders .Following a request to effect such a registration, we are required to give notice of the request to the other holders of registrable securities and offer them anopportunity to include their shares in the registration statement. We are not required to effect a registration on Form F-3 more than twice in any 12 monthperiod and are only required to do so if the aggregate proceeds from any such registration are estimated in good faith to be in excess of $2.0 million. Piggyback Registration Rights. Following our initial public offering, shareholders holding registrable securities also have the right to request that we includetheir registrable securities in any registration statement filed by us in the future for the purposes of a public offering for cash, subject to specified exceptions. Cutback. In the event that the managing underwriter advises the registering shareholders that marketing factors require a limitation on the number of sharesthat can be included in a registered offering, the shares will be included in the registration statement in an agreed order of preference among the holders ofregistration rights. The same preference also applies in the case of a piggyback registration, but we have first preference and the number of shares ofshareholders that are included may not be less than 30% of the total number of shares included in the offering. Termination. All registration rights granted to holders of registrable securities terminate on the fifth anniversary of the closing of our initial public offeringand, with respect to any of our holders of registrable securities when the shares held by such shareholder can be sold within a 90 day period under Rule 144 . Expenses. We will pay all expenses in carrying out the foregoing registrations other than selling shareholders’ underwriting discounts and transfer taxes. Item 8. Financial Information Financial statements are set forth under Item 18. We have never declared or paid any cash dividends to our shareholders. We currently anticipate that we will retain all of our future earnings, if any, for use inthe operation of our business. Additionally, our ability to pay dividends on our ordinary shares is limited by restrictions under the terms of the agreementsgoverning our indebtedness and under Israeli law. Item 9. The Offer and Listing Our ordinary shares are quoted on the Nasdaq Global Market under the symbol “VBLT.” 92 Table of Contents Nasdaq Global Market The following table sets forth, for the periods indicated since October 1, 2014, which was the date on which our ordinary shares began trading on the NasdaqGlobal Market under the symbol “VBLT,” the high and low sales prices of our ordinary shares as reported by the Nasdaq Global Market. Price Per Ordinary Share High Low Annual: 2014 $7.56 $4.65 2015 17.02 3.09 2016 7.58 2.76 2017 9.05 3.90 Quarterly: First Quarter 2016 $5.22 $2.76 Second Quarter 2016 $7.58 $3.03 Third Quarter 2016 $5.83 $3.74 Fourth Quarter 2016 $6.20 $4.45 First Quarter 2017 $6.50 $4.20 Second Quarter 2017 $6.70 $4.35 Third Quarter 2017 $7.25 $3.90 Fourth Quarter 2017 $9.05 $5.60 First Quarter 2018 (through March 9, 2017) $8.50 $2.60 Most Recent Six Months: October 2017 $7.05 $5.60 November 2017 $9.05 $5.95 December 2017 $7.30 $6.40 January 2018 $8.50 $7.10 February 2018 $6.70 $6.00 On March 9, 2018, the last reported sale price of our ordinary shares on the Nasdaq Global Market was $2.60 per share. Item 10. Additional Information A. Share Capital Not applicable. B. Memorandum and Articles of Association Ordinary Shares Voting All ordinary shares will have identical voting and other rights in all respects. Transfer of Shares Our fully paid ordinary shares are issued in registered form and may be freely transferred under our amended and restated articles of association, unless thetransfer is restricted or prohibited by another instrument, applicable law or the rules of a stock exchange on which the shares are listed for trade. Theownership or voting of our ordinary shares by non-residents of Israel is not restricted in any way by our amended and restated articles of association or thelaws of the State of Israel, except for ownership by nationals of some countries that are, or have been, in a state of war with Israel. 93 Table of Contents Election of Directors Our ordinary shares do not have cumulative voting rights for the election of directors. As a result, the holders of a majority of the voting power represented ata shareholders meeting have the power to elect all of our directors, subject to the special approval requirements for external directors described under “Item 6.Directors, Senior Management and Employees—Board of Directors.” Under our amended and restated articles of association, our board of directors must consist of not less than three, not including two external directors, but nomore than nine directors (including the external directors).. Pursuant to our amended and restated articles of association, other than the external directors, forwhom special election requirements apply under the Companies Law, the vote required to appoint a director is a simple majority vote of holders of our votingshares, participating and voting at the relevant meeting. Each director will serve until his or her successor is duly elected and qualified or until his or herearlier death, resignation or removal by a vote of the majority voting power of our shareholders at a general meeting of our shareholders or until his or heroffice expires by operation of law, in accordance with the Companies Law. In addition, our amended and restated articles of association allow our board ofdirectors to appoint directors to fill vacancies on the board of directors to serve for a term of office equal to the remaining period of the term of office of thedirectors(s) whose office(s) have been vacated. External directors are elected for an initial term of three years, may be elected for additional terms of threeyears each under certain circumstances, and may be removed from office pursuant to the terms of the Companies Law. See “Item 6. Directors, SeniorManagement and Employees—Board of Directors.” Dividend and Liquidation Rights We may declare a dividend to be paid to the holders of our ordinary shares in proportion to their respective shareholdings. Under the Companies Law,dividend distributions are determined by the board of directors and do not require the approval of the shareholders of a company unless the company’sarticles of association provide otherwise. Our amended and restated articles of association do not require shareholder approval of a dividend distribution andprovide that dividend distributions may be determined by our board of directors. Pursuant to the Companies Law, the distribution amount is limited to the greater of retained earnings or earnings generated over the previous two years,according to our then last reviewed or audited financial statements, provided that the date of the financial statements is not more than six months prior to thedate of the distribution, or we may otherwise only distribute dividends that do not meet such criteria only with court approval. In each case, we are onlypermitted to distribute a dividend if our board of directors and the court, if applicable, determines that there is no reasonable concern that payment of thedividend will prevent us from satisfying our existing and foreseeable obligations as they become due. In the event of our liquidation, after satisfaction of liabilities to creditors, our assets will be distributed to the holders of our ordinary shares in proportion totheir shareholdings. This right, as well as the right to receive dividends, may be affected by the grant of preferential dividend or distribution rights to theholders of a class of shares with preferential rights that may be authorized in the future. Shareholder Meetings Under Israeli law, we are required to hold an annual general meeting of our shareholders once every calendar year that must be held no later than 15 monthsafter the date of the previous annual general meeting. All meetings other than the annual general meeting of shareholders are referred to in our amended andrestated articles of association as extraordinary general meetings. Our board of directors may call extraordinary general meetings whenever it sees fit, at suchtime and place, within or outside of Israel, as it may determine. In addition, the Companies Law provides that our board of directors is required to convene anextraordinary general meeting upon the written request of (i) any two of our directors or one- quarter of the members of our board of directors or (ii) one ormore shareholders holding, in the aggregate, either (a) 5% or more of our outstanding issued shares and 1% of our outstanding voting power or (b) 5% ormore of our outstanding voting power. One or more shareholders, holding 1% or more of the outstanding voting power, may ask the board to add an item tothe agenda of a prospective meeting, if the proposal merits discussion at the general meeting. 94 Table of Contents Subject to the provisions of the Companies Law and the regulations promulgated thereunder, shareholders entitled to participate and vote at generalmeetings are the shareholders of record on a date to be decided by the board of directors, which may be between four and 40 days prior to the date of themeeting. Furthermore, the Companies Law requires that resolutions regarding the following matters must be passed at a general meeting of our shareholders: ●amendments to our articles of association; ●appointment or termination of our auditors; ●appointment of external directors; ●approval of certain related party transactions; ●increases or reductions of our authorized share capital; ●a merger; and ●the exercise of our board of director’s powers by a general meeting, if our board of directors is unable to exercise its powers and the exerciseof any of its powers is required for our proper management. The Companies Law and our amended and restated articles of association require that a notice of any annual general meeting or extraordinary generalmeeting be provided to shareholders at least 21 days prior to the meeting and if the agenda of the meeting includes the appointment or removal of directors,the approval of transactions with office holders or interested or related parties, or an approval of a merger, notice must be provided at least 35 days prior to themeeting. Under the Companies Law and our amended and restated articles of association, shareholders are not permitted to take action via written consent in lieu of ameeting. Quorum Requirements Pursuant to our amended and restated articles of association, holders of our ordinary shares have one vote for each ordinary share held on all matterssubmitted to a vote before the shareholders at a general meeting. As a foreign private issuer, the quorum required for our general meetings of shareholdersconsists of at least two shareholders present in person, by proxy or written ballot who hold or represent between them at least 25% of the total outstandingvoting rights. A meeting adjourned for lack of a quorum is generally adjourned to the same day in the following week at the same time and place or to a latertime or date if so. Vote Requirements Our amended and restated articles of association provide that all resolutions of our shareholders require a simple majority vote, unless otherwise required bythe Companies Law or by our amended and restated articles of association. Under the Companies Law, each of (i) the approval of an extraordinary transactionwith a controlling shareholder and (ii) the terms of employment or other engagement of the controlling shareholder of the company or such controllingshareholder’s relative (even if not extraordinary) requires, the approval described above under “Management—Approval of Related Party Transactions UnderIsraeli Law—Disclosure of Personal Interests of Controlling Shareholders and Approval of Certain Transactions.” Under our amended and restated articles ofassociation, the alteration of the rights, privileges, preferences or obligations of any class of our shares requires a simple majority vote of the class so affected(or such other percentage of the relevant class that may be set forth in the governing documents relevant to such class), in addition to the ordinary majorityvote of all classes of shares voting together as a single class at a shareholder meeting. An exception to the simple majority vote requirement is a resolution forthe voluntary winding up, or an approval of a scheme of arrangement or reorganization, of the company pursuant to Section 350 of the Companies Law,which requires the approval of holders of 75% of the voting rights represented at the meeting, in person, by proxy or by voting deed and voting on theresolution. 95 Table of Contents Access to Corporate Records Under the Companies Law, shareholders are provided access to: minutes of our general meetings; our shareholders register and principal shareholders register,articles of association and financial statements; and any document that we are required by law to file publicly with the Israeli Companies Registrar or theIsrael Securities Authority. In addition, shareholders may request to be provided with any document related to an action or transaction requiring shareholderapproval under the related party transaction provisions of the Companies Law. We may deny this request if we believe it has not been made in good faith or ifsuch denial is necessary to protect our interest or protect a trade secret or patent. Acquisitions Under Israeli Law Full Tender Offer A person wishing to acquire shares of an Israeli public company and who would as a result hold over 90% of the target company’s issued and outstandingshare capital is required by the Companies Law to make a tender offer to all of the company’s shareholders for the purchase of all of the issued andoutstanding shares of the company. A person wishing to acquire shares of a public Israeli company and who would as a result hold over 90% of the issued andoutstanding share capital of a certain class of shares is required to make a tender offer to all of the shareholders who hold shares of the relevant class for thepurchase of all of the issued and outstanding shares of that class. If the shareholders who do not accept the offer hold less than 5% of the issued andoutstanding share capital of the company or of the applicable class, and more than half of the shareholders who do not have a personal interest in the offeraccept the offer, all of the shares that the acquirer offered to purchase will be transferred to the acquirer by operation of law. However, a tender offer will alsobe accepted if the shareholders who do not accept the offer hold less than 2% of the issued and outstanding share capital of the company or of the applicableclass of shares. Upon a successful completion of such a full tender offer, any shareholder that was an offeree in such tender offer, whether such shareholder accepted thetender offer or not, may, within six months from the date of acceptance of the tender offer, petition an Israeli court to determine whether the tender offer wasfor less than fair value and that the fair value should be paid as determined by the court. However, under certain conditions, the offeror may include in theterms of the tender offer that an offeree who accepted the offer will not be entitled to petition the Israeli court as described above. If (a) the shareholders who did not respond or accept the tender offer hold at least 5% of the issued and outstanding share capital of the company or of theapplicable class or the shareholders who accept the offer constitute less than a majority of the offerees that do not have a personal interest in the acceptance ofthe tender offer, or (b) the shareholders who did not accept the tender offer hold 2% or more of the issued and outstanding share capital of the company (or ofthe applicable class), the acquirer may not acquire shares of the company that will increase its holdings to more than 90% of the company’s issued andoutstanding share capital or of the applicable class from shareholders who accepted the tender offer. Special Tender Offer The Companies Law provides that an acquisition of shares of an Israeli public company must be made by means of a special tender offer if as a result of theacquisition the purchaser would become a holder of 25% or more of the voting rights in the company. This requirement does not apply if there is alreadyanother holder of at least 25% of the voting rights in the company. Similarly, the Companies Law provides that an acquisition of shares in a public companymust be made by means of a special tender offer if, as a result of the acquisition, the purchaser would become a holder of more than 45% of the voting rightsin the company, provided that there is no other shareholder of the company who holds more than 45% of the voting rights in the company, subject to certainexceptions. 96 Table of Contents A special tender offer must be extended to all shareholders of a company but the offeror is not required to purchase shares representing more than 5% of thevoting power attached to the company’s outstanding shares, regardless of how many shares are tendered by shareholders. A special tender offer may beconsummated only if (i) outstanding shares representing at least 5% of the voting power of the company will be acquired by the offeror and (ii) the number ofshares tendered in the offer exceeds the number of shares whose holders objected to the offer (excluding the purchaser, controlling shareholders, holders of25% or more of the voting rights in the company or any person having a personal interest in the acceptance of the tender offer). If a special tender offer isaccepted, then the purchaser or any person or entity controlling it or under common control with the purchaser or such controlling person or entity may notmake a subsequent tender offer for the purchase of shares of the target company and may not enter into a merger with the target company for a period of oneyear from the date of the offer, unless the purchaser or such person or entity undertook to effect such an offer or merger in the initial special tender offer. Merger The Companies Law permits merger transactions if approved by each party’s board of directors and, unless certain requirements described under theCompanies Law are met, by a majority vote of each party’s shareholders, and, in the case of the target company, a majority vote of each class of its shares,voted on the proposed merger at a shareholders meeting. For purposes of the shareholder vote, unless a court rules otherwise, the merger will not be deemed approved if a majority of the votes of shares represented atthe shareholders meeting that are held by parties other than the other party to the merger, or by any person (or group of persons acting in concert) who holds(or hold, as the case may be) 25% or more of the voting rights or the right to appoint 25% or more of the directors of the other party, vote against the merger.If, however, the merger involves a merger with a company’s own controlling shareholder or if the controlling shareholder has a personal interest in the merger,then the merger is instead subject to the same special majority approval that governs all extraordinary transactions with controlling shareholders (asdescribed under “Item 6. Directors, Senior Management and Employees—Disclosure of Personal Interests of Controlling Shareholders and Approval ofCertain Transactions”). If the transaction would have been approved by the shareholders of a merging company but for the separate approval of each class or the exclusion of thevotes of certain shareholders as provided above, a court may still approve the merger upon the request of holders of at least 25% of the voting rights of acompany, if the court holds that the merger is fair and reasonable, taking into account the value of the parties to the merger and the consideration offered tothe shareholders of the target company. Upon the request of a creditor of either party to the proposed merger, the court may delay or prevent the merger if it concludes that there exists a reasonableconcern that, as a result of the merger, the surviving company will be unable to satisfy the obligations of the merging entities, and may further giveinstructions to secure the rights of creditors. In addition, a merger may not be consummated unless at least 50 days have passed from the date on which a proposal for approval of the merger was filed byeach party with the Israeli Registrar of Companies and at least 30 days have passed from the date on which the merger was approved by the shareholders ofeach party. 97 Table of Contents Anti-takeover Measures The Companies Law allow us to create and issue shares having rights different from those attached to our ordinary shares, including shares providing certainpreferred rights with respect to voting, distributions or other matters and shares having preemptive rights. No preferred shares are currently authorized underour amended and restated articles of association. In the future, if we do authorize, create and issue a specific class of preferred shares, such class of shares,depending on the specific rights that may be attached to it, may have the ability to frustrate or prevent a takeover or otherwise prevent our shareholders fromrealizing a potential premium over the market value of their ordinary shares. The authorization and designation of a class of preferred shares will require anamendment to our amended and restated articles of association, which requires the prior approval of the holders of a majority of the voting power attaching toour issued and outstanding shares at a general meeting. The convening of the meeting, the shareholders entitled to participate and the majority vote requiredto be obtained at such a meeting will be subject to the requirements set forth in the Companies Law as described above in “—Voting Rights.” Tax Law Israeli tax law treats some acquisitions, such as stock-for-stock swaps between an Israeli company and a foreign company, less favorably than U.S. tax law. Forexample, Israeli tax law may subject a shareholder who exchanges ordinary shares in an Israeli company for shares in a non-Israeli corporation to immediatetaxation unless such shareholder receives authorization from the Israeli Tax Authority for different tax treatment. Modification of Class Rights Under the Companies Law and our amended and restated articles of association, the rights attached to any class of share, such as voting, liquidation anddividend rights, may be amended by adoption of a resolution by the holders of a majority of the shares of that class present at a separate class meeting, orotherwise in accordance with the rights attached to such class of shares, as set forth in our amended and restated articles of association. Establishment Our registration number with the Israeli Registrar of Companies is 51-289976-6. Our purpose as set forth in our amended and restated articles of association isto engage in any lawful activity. Transfer Agent and Registrar The transfer agent and registrar for our ordinary shares is American Stock Transfer & Trust Company, LLC. C. Material Contracts We have not entered into any material contracts other than in the ordinary course of business and other than those described in “Item 4. Information on theCompany,” “Item 6. Directors, Senior Management and Employees” or elsewhere in this Annual Report. D. Exchange Controls There are currently no Israeli currency control restrictions on remittances of dividends on our ordinary shares, proceeds from the sale of the shares or interestor other payments to non- residents of Israel, except for shareholders who are subjects of countries that are, or have been, in a state of war with Israel. In 1998, Israeli currency control regulations were liberalized significantly, so that Israeli residents generally may freely deal in foreign currency and foreignassets, and non-residents may freely deal in Israeli currency and Israeli assets. There are currently no Israeli currency control restrictions on remittances ofdividends on the ordinary shares or the proceeds from the sale of the shares provided that all taxes were paid or withheld; however, legislation remains ineffect pursuant to which currency controls can be imposed by administrative action at any time. 98 Table of Contents Non-residents of Israel may freely hold and trade our securities. Neither our articles of association nor the laws of the State of Israel restrict in any way theownership or voting of ordinary shares by non-residents, except that such restrictions may exist with respect to citizens of countries which are in a state of warwith Israel. Israeli residents are allowed to purchase our ordinary shares. E. Taxation The following description is not intended to constitute a complete analysis of all tax consequences relating to the acquisition, ownership and disposition ofour ordinary shares. You should consult your own tax advisor concerning the tax consequences of your particular situation, as well as any tax consequencesthat may arise under the laws of any state, local, foreign or other taxing jurisdiction. Israeli Tax Considerations and Government Programs The following is a brief summary of the material Israeli tax laws applicable to us, and certain Israeli Government programs that may benefit us. This sectionalso contains a discussion of material Israeli tax consequences concerning the ownership and disposition of our ordinary shares purchased by investors. Thissummary does not discuss all the aspects of Israeli tax law that may be relevant to a particular investor in light of his or her personal investment circumstancesor to some types of investors subject to special treatment under Israeli law. Examples of such investors include residents of Israel or traders in securities whoare subject to special tax regimes not covered in this discussion. Because parts of this discussion are based on new tax legislation that has not yet beensubject to judicial or administrative interpretation, we cannot assure you that the appropriate tax authorities or the courts will accept the views expressed inthis discussion. The discussion below is subject to change, including due to amendments under Israeli law or changes to the applicable judicial oradministrative interpretations of Israeli law, which change could affect the tax consequences described below. General Corporate Tax Structure in Israel Israeli companies are generally subject to corporate tax, currently at the rate of 23% of a company’s taxable income. However, the effective tax rate payableby a company that derives income from an Approved Enterprise, a Benefited Enterprise, a Preferred Enterprise or a Preferred Technology Enterprise (asdiscussed below) may be considerably less. Capital gains derived by an Israeli company are generally subject to tax at the prevailing corporate tax rate. In December 2016, the Economic Efficiency Law (Legislative Amendments for Implementing the Economic Policy for the 2017 and 2018 Budget Year) waspublished, introducing a gradual reduction in corporate tax rate from 25% to 23%. However, the law also included a temporary provision setting thecorporate tax rate in 2017 at 24%. As a result, the corporate tax rate was 24% in 2017 and will be 23% in 2018 and thereafter. Law for the Encouragement of Industry (Taxes), 5729-1969 The Law for the Encouragement of Industry (Taxes), 5729-1969, generally referred to as the Industry Encouragement Law, provides several tax benefits for“Industrial Companies.” The Industry Encouragement Law defines an “Industrial Company” as a company incorporated and resident in Israel, of which 90% or more of its income inany tax year, other than income from defense loans, is derived from an “Industrial Enterprise” owned by it that is located in Israel. An “Industrial Enterprise”is defined as an enterprise whose principal activity in a given tax year is industrial production. 99 Table of Contents The following corporate tax benefits, among others, are available to Industrial Companies: ●amortization over an eight-year period of the cost of patents and rights to use patents and know-how which were purchased in good faithand are used for the development or advancement of the Industrial Enterprise; ●under certain conditions, an election to file consolidated tax returns with related Israeli Industrial Companies; and ●expenses related to a public offering are deductible in equal amounts over three years. There is no assurance that we qualify as an Industrial Company or that the benefits described above are currently available to us or will be available to us inthe future. Law for the Encouragement of Capital Investments, 5719-1959 The Law for the Encouragement of Capital Investments, 5719-1959, generally referred to as the Investment Law, provides certain incentives for capitalinvestments in productive assets, such as production facilities, by “Industrial Enterprises” (as defined under the Investment Law). The Investment Law was significantly amended effective April 1, 2005 (the “2005 Amendment”), and further amended as of January 1, 2011 (the “2011Amendment”) and as of January 1, 2017 (the “2017 Amendment”). Pursuant to the 2005 Amendment, tax benefits granted in accordance with the provisionsof the Investment Law prior to its revision by the 2005 Amendment remain in force but any benefits granted subsequently are subject to the provisions of the2005 Amendment. Similarly, the 2011 Amendment introduced new benefits to replace those granted in accordance with the provisions of the Investment Lawin effect prior to the 2011 Amendment. However, companies entitled to benefits under the Investment Law as in effect prior to January 1, 2011 were entitledto choose to continue to enjoy such benefits, provided that certain conditions are met, or elect instead, irrevocably, to forego such benefits and have thebenefits of the 2011 Amendment apply. Finally, the 2017 Amendment provided another benefits track, which represents an alternative to the tracks availableunder the 2005 Amendment and the 2011 Amendment. We have examined the possible effect, if any, of these provisions of the 2011 Amendment and the2017 Amendment on our financial statements and have decided, at this time, not to opt to apply the new benefits under the 2011 Amendment or the 2017Amendment. Tax Benefits Prior to the 2005 Amendment An investment program that is implemented in accordance with the provisions of the Investment Law prior to the 2005 Amendment, referred to as an“Approved Enterprise,” is entitled to certain benefits. A company that wished to receive benefits as an Approved Enterprise must have received approval fromthe Investment Center of the Israeli Ministry of the Economy (formerly the Ministry of Industry, Trade and Labor), or the Investment Center. Each certificateof approval for an Approved Enterprise relates to a specific investment program in the Approved Enterprise, delineated both by the financial scope of theinvestment and by the physical characteristics of the facility or the asset. In general, an Approved Enterprise is entitled to receive a grant from the Government of Israel or an alternative package of tax benefits, known as thealternative benefits track. The tax benefits from any certificate of approval relate only to taxable income attributable to the specific Approved Enterprise.Income derived from activity that is not integral to the activity of the Approved Enterprise does not enjoy tax benefits. In addition, a company that has an Approved Enterprise program is eligible for further tax benefits if it qualifies as a Foreign Investors’ Company (“FIC”),which is a company with a level of foreign investment, as defined in the Investment Law, of more than 25%. The level of foreign investment is measured asthe percentage of rights in the company (in terms of shares, rights to profits, voting and appointment of directors), and of combined share capital and loans,that are owned, directly or indirectly, by persons who are not residents of Israel. The determination as to whether a company qualifies as an FIC is made on anannual basis. 100 Table of Contents If a company elects the alternative benefits track and distributes a dividend out of income derived by its Approved Enterprise during the tax exemptionperiod it will be subject to corporate tax in respect of the amount of the dividend (grossed-up to reflect the pre-tax income that it would have had to earn inorder to distribute the dividend) at the corporate tax rate which would have been applicable without the tax exemption under the alternative benefits track. Inaddition, dividends paid out of income attributed to an Approved Enterprise are generally subject to withholding tax at source at the rate of 15% or suchlower rate as may be provided in an applicable tax treaty. The Investment Law also provides that an Approved Enterprise is entitled to accelerated depreciation on its property and equipment that are included in anApproved Enterprise program during the first five years in which the equipment is used. The benefits available to an Approved Enterprise are subject to the fulfillment of conditions stipulated in the Investment Law and its regulations and thecriteria in the specific certificate of approval. If a company does not meet these conditions, it would be required to repay the amount of tax benefits, asadjusted by the Israeli consumer price index, and interest. We do not have Approved Enterprise programs. Tax Benefits Subsequent to the 2005 Amendment The 2005 Amendment applies to new investment programs commencing after 2004, but does not apply to investment programs approved prior to April 1,2005. The 2005 Amendment provides that terms and benefits included in any certificate of approval that was granted before the 2005 Amendment becameeffective (April 1, 2005) will remain subject to the provisions of the Investment Law as in effect on the date of such approval. The 2005 Amendment provides that a certificate of approval from the Investment Center will only be necessary for receiving cash grants. As a result, it was nolonger necessary for a company to obtain an Approved Enterprise certificate of approval in order to receive the tax benefits previously available under thealternative benefits track. Rather, a company may claim the tax benefits offered by the alternative benefits track directly in its tax returns, provided that itmeets the criteria for tax benefits set forth in the amendment. In order to receive the tax benefits, the 2005 Amendment states, inter alia, that a company mustmake an investment which meets all of the conditions, including a minimum qualifying investment in certain productive assets as specified in the InvestmentLaw. Such investment, along with the fulfillment of certain export requirements, allows a company to receive “Benefited Enterprise” status, and may be madeover a period of no more than three years culminating with the end of the Benefited Enterprise election year. The extent of the tax benefits available under the 2005 Amendment to qualifying income of a Benefited Enterprise depends on, among other things, thegeographic location in Israel of the Benefited Enterprise. The location will also determine the period for which tax benefits are available. Such tax benefitsinclude an exemption from corporate tax on undistributed income generated by the Benefited Enterprise for a period of between two to ten years, dependingon the geographic location of the Benefited Enterprise in Israel, and a reduced corporate tax rate of between 10% to 25% for the remainder of the benefitsperiod, depending on the level of foreign investment in the company in each year. The benefits period is limited to 12 years from the beginning of theBenefited Enterprise election year. With respect to an establishment Benefited Enterprise plan located in certain specific locations, the benefits period islimited to 14 years from the beginning of the Benefited Enterprise election year, depending on the location of the Benefited Enterprise. We informed theIsraeli Tax Authority of our choice of 2012 as a Benefited Enterprise election year. A company qualifying for tax benefits under the 2005 Amendment whichpays a dividend out of income derived by its Benefited Enterprise during the tax exemption period will be subject to corporate tax in respect of the amount ofthe dividend (grossed-up to reflect the pre-tax income that it would have had to earn in order to distribute the dividend) at the corporate tax rate which wouldhave otherwise been applicable. Dividends paid out of income attributed to a Benefited Enterprise are generally subject to withholding tax at source at therate of 15% or such lower rate as may be provided in an applicable tax treaty. 101 Table of Contents The benefits available to a Benefited Enterprise are subject to the fulfillment of conditions stipulated in the Investment Law and its regulations. If a companydoes not meet these conditions, in a given tax year during the benefits period, it would generally not be eligible for tax benefits during such tax year;however, the company’s eligibility for tax benefits in prior and future years should not be impacted. We currently have one Benefited Enterprise program under the Investments Law, which, we believe, may entitle us to certain tax benefits. The tax benefitperiod for this program has not yet commenced but is expected to end no later than the end of tax year 2023. During the benefits period, which shallcommence with the year we will first earn taxable income relating to such enterprise, subject to the 12 years limitation described above, and shall run for aperiod of up to 10 years (assuming FIC status), a corporate tax exemption is expected to apply with respect to the taxable income from our BenefitedEnterprise program (once generated) generated during the first two years of the benefits period (so long as it remains undistributed) and reduced corporate taxrates are expected to apply to such taxable income generated in the remaining years of the benefits period. There is no assurance that our future taxable income will qualify as Benefited Enterprise income or that the benefits described above will be available to us inthe future. Tax Benefits Under the 2011 Amendment The 2011 Amendment canceled the availability of the benefits granted to companies under the Investment Law prior to 2011, subject to certain exceptions,and, instead, introduced new benefits for income generated by a “Preferred Company” through its “Preferred Enterprise” (as such terms are defined in theInvestment Law) as of January 1, 2011. The definition of a Preferred Company includes a company incorporated in Israel that is not wholly-owned by agovernmental entity, and that has, among other things, Preferred Enterprise status and is controlled and managed from Israel. Pursuant to the 2011Amendment, in 2014 and thereafter a Preferred Company is entitled to a reduced corporate tax rate of 16% with respect to its income derived by its PreferredEnterprise unless the Preferred Enterprise is located in development zone A, in which case the rate will be 9%. This latter rate was reduced to 7.5% as ofJanuary 1, 2017. It should be noted, that the classification of income generated from the provision of usage rights in know-how or software that weredeveloped in the Preferred Enterprise, as well as royalty income received with respect to such usage, as Preferred Enterprise income may be subject to theissuance of a pre-ruling from the Israel Tax Authority stipulating that such income is associated with the productive activity of the Preferred Enterprise inIsrael. Dividends paid out of income attributed to a Preferred Enterprise are generally subject to withholding tax at source at the rate of 20% or such lower rate asmay be provided in an applicable tax treaty. However, if such dividends are paid to an Israeli company, no tax is required to be withheld (although, if suchdividends are subsequently distributed to individuals or a non-Israeli company, withholding tax at a rate of 20% or such lower rate as may be provided in anapplicable tax treaty will apply). The 2011 Amendment also provided transitional provisions to address companies that may be eligible for tax benefits under the Approved Enterprise orBenefited Enterprise regimes. These transitional provisions provide, among other things, that unless an irrevocable request is made to apply the provisions ofthe Investment Law as amended in 2011 with respect to income to be derived as of January 1, 2011: (1) the terms and benefits included in any certificate ofapproval that was granted to an Approved Enterprise which chose to receive grants before the 2011 Amendment became effective will remain subject to theprovisions of the Investment Law as in effect on the date of such approval, and subject to certain other conditions, (2) terms and benefits included in anycertificate of approval that was granted to an Approved Enterprise which had participated in an alternative benefits track before the 2011 Amendment becameeffective will remain subject to the provisions of the Investment Law as in effect on the date of such approval, provided that certain conditions are met, and(3) a Benefited Enterprise can elect to continue to benefit from the benefits provided to it before the 2011 Amendment came into effect, provided that certainconditions are met. 102 Table of Contents We have examined the potential Israeli tax implications associated with the adoption and implementation of the provisions of the 2011 Amendment andhave decided, at this time, not to apply the new benefits under the 2011 Amendment. There is no assurance that our future taxable income will qualify asPreferred Enterprise income or that the benefits described above will be available to us in the future. The termination or substantial reduction of any of the benefits available under the Investment Law could materially increase our tax liabilities. Tax Benefits Under the 2017 Amendment The 2017 Amendment introduced new benefits for income generated by a “Preferred Company” (as defined above) through its “Preferred TechnologyEnterprise” (as defined in the Investment Law) as of January 1, 2017. Pursuant to the 2017 Amendment, in 2017 and thereafter a Preferred Company isentitled to a reduced corporate tax rate of 12% with respect to its income derived by its Preferred Technology Enterprise unless the Preferred Enterprise islocated in development zone A, in which case the rate will be 7.5%. It should be noted that the calculation of a Preferred Company's Preferred TechnologyEnterprise income is based on a complex formula and the income not classified as such may be classified as Preferred Enterprise income or ordinary incomedepending on the circumstances. In addition, a Preferred Company must generally fulfill certain conditions to be eligible for Preferred Technology Enterprisestatus including, inter alia, an R&D expenses level of at least 7% of total revenues or NIS 75 million per year. Dividends paid out of Preferred Technology Enterprise income are generally subject to withholding tax at source at the rate of 20% or such lower rate as maybe provided in an applicable tax treaty. However, subject to the fulfillment of certain conditions, to the extent that the dividends are paid to a direct foreignparent company holding at least 90% of the shares of the Preferred Company, a reduced withholding tax rate of 4% shall apply. Notwithstanding the above, ifsuch dividends are paid to an Israeli company, no tax is required to be withheld (although, if such dividends are subsequently distributed to individuals or anon-Israeli company, withholding tax at a rate of 20% or such lower rate as may be provided in an applicable tax treaty will apply). We have examined the potential Israeli tax implications associated with the adoption and implementation of the provisions of the 2017 Amendment andhave decided, at this time, not to apply the new benefits under the 2017 Amendment. There is no assurance that our future taxable income will qualify asPreferred Technology Enterprise income or that the benefits described above will be available to us in the future. The termination or substantial reduction of any of the benefits available under the Investment Law could materially increase our tax liabilities. Taxation of Our Shareholders This discussion does not address the tax consequences applicable to shareholders that own, or have owned at any time, directly or indirectly, 10% or more ofour shares (“Controlling Shareholders”), and such shareholders should consult their tax advisers as to the tax consequences of owning or disposing of ourshares. Capital Gains Taxes Applicable to Non-Israeli Resident Shareholders A non-Israeli resident who derives capital gains from the sale of shares in an Israeli resident company that were purchased after the Company was listed fortrading on a stock exchange outside of Israel will be exempt from Israeli tax so long as, inter alia, such capital gains were not attributable to a permanentestablishment that the non-resident maintains in Israel. However, non-Israeli resident corporations will not be entitled to the foregoing exemption if the Israeli residents: (i) have a controlling interest, directly orindirectly, alone, together with another (i.e., together with a relative, or together with someone who is not a relative but with whom, according to anagreement, there is regular cooperation in material matters of the company, directly or indirectly), or together with another Israeli resident, of more than 25%in one or more of the means of control in such non-Israeli resident corporation, or (ii) Israeli residents are the beneficiaries of, or are entitled to, 25% or moreof the revenues or profits of such non-Israeli resident corporation, whether directly or indirectly. Additionally, a sale of securities by a non-Israeli resident may be exempt from Israeli capital gains tax under the provisions of an applicable tax treaty. Forexample, under the United States- Israel Tax Treaty, the disposition of shares by a shareholder who (1) is a U.S. resident (for purposes of the treaty), (2) holdsthe shares as a capital asset, and (3) is entitled to claim the benefits afforded to such person by the treaty, is generally exempt from Israeli capital gains tax.Such exemption will not apply if: (1) the capital gain arising from the disposition can be attributed to a permanent establishment in Israel, (2) the shareholderholds, directly or indirectly, shares representing 10% or more of the voting power of the company during any part of the 12-month period preceding thedisposition, subject to certain conditions, or (3) such U.S. resident is an individual and was present in Israel for 183 days or more during the relevant taxableyear. In such case, the sale, exchange or disposition of our ordinary shares would be subject to Israeli tax, to the extent applicable; however, under the UnitedStates-Israel Tax Treaty, the taxpayer would be permitted to claim a credit for such taxes against the U.S. federal income tax imposed with respect to suchsale, exchange or disposition, subject to the limitations under U.S. law applicable to foreign tax credits. The United States-Israel Tax Treaty does not relate toU.S. state or local taxes. In some instances where our shareholders may be liable for Israeli tax on the sale of their ordinary shares, the payment of the consideration may be subject tothe withholding of Israeli tax at source. Shareholders may be required to demonstrate that they are exempt from tax on their capital gains in order to avoidwithholding at source at the time of sale. 103 Table of Contents Taxation of Non-Israeli Shareholders on Receipt of Dividends Non-Israeli residents are generally subject to Israeli withholding tax on the receipt of dividends paid on our ordinary shares at the rate of 25%, unless relief isprovided in a treaty between Israel and the shareholder’s country of residence, subject to receipt of a valid certificate from the Israeli Tax Authority allowingfor such reduced rate. With respect to a person who is a “substantial shareholder” at the time of receiving the dividend or at any time during the precedingtwelve months, the applicable withholding tax rate is 30%. Furthermore, an additional 3% tax might be applicable to individual shareholders if certainconditions are met. A “substantial shareholder” is generally a person who alone or together with such person’s relative or another person who collaborateswith such person on a permanent basis, holds, directly or indirectly, at least 10% of any of the “means of control” of the corporation. “Means of control”generally include the right to vote, receive profits, nominate a director or an executive officer, receive assets upon liquidation, or order someone who holdsany of the aforesaid rights how to act, regardless of the source of such right. Notwithstanding the above, dividends paid to a non-Israeli resident “substantialshareholder” on publicly traded shares, like our ordinary shares, which are held via a “nominee company” (as defined under the Securities Law, 1968), aregenerally subject to Israeli withholding tax at a rate of 25%, unless a different rate is provided under an applicable tax treaty, provided that a certificate fromthe Israeli Tax Authority allowing for a reduced withholding tax rate is obtained in advance. Under the United States-Israel Tax Treaty, the maximum rate oftax withheld at source in Israel on dividends paid to a holder of our ordinary shares who is a U.S. resident (for purposes of the United States- Israel Tax Treaty)is 25%. Unless a reduced tax rate is provided under an applicable tax treaty, a distribution of dividends to non-Israeli residents is subject to withholding taxat source at a rate of 15% if the dividend is distributed from income attributed to an Approved Enterprise or a Benefited Enterprise, while a 20% rate applies ifthe dividend is distributed from Preferred Enterprise income or Preferred Technology Enterprise income (unless the dividend is paid to a foreign parentcompany directly holding at least 90% of the shares of the Preferred Company, in which case a 4% withholding tax rate shall apply). We cannot assure youthat in the event we declare a dividend we will designate the income out of which the dividend is paid in a manner that will reduce shareholders’ tax liability. If the dividend is attributable partly to Approved Enterprise income, Benefited Enterprise income, Preferred Enterprise income or Preferred TechnologyEnterprise income, and partly to other sources of income, the withholding rate will be a blended rate reflecting the relative portions of the two types ofincome. U.S. residents who are subject to Israeli withholding tax on a dividend may be entitled to a credit or deduction for Untied States federal income taxpurposes in the amount of the taxes withheld, subject to detailed rules contained in U.S. tax legislation. Estate and Gift Tax Israeli law presently does not impose estate or gift taxes. Certain Material U.S. Federal Income Tax Considerations The following is a description of the material U.S. federal income tax considerations relating to the ownership and disposition of our ordinary shares by a U.S.Holder (as defined below). This description addresses only the U.S. federal income tax considerations to U.S. Holders that will hold such ordinary shares ascapital assets. This description does not address tax considerations applicable to U.S. Holders that may be subject to special tax rules, including, withoutlimitation: ●banks, financial institutions or insurance companies; ●real estate investment trusts, regulated investment companies or grantor trusts; ●brokers, dealers or traders in securities, commodities or currencies; ●tax exempt entities or organizations, including an “individual retirement account” or “Roth IRA” as defined in Section 408 or 408A of theCode (as defined below), respectively; ●certain former citizens or long term residents of the United States; ●persons that received our shares as compensation for the performance of services; ●persons that will hold our shares as part of a “hedging,” “integrated” or “conversion” transaction or as a position in a “straddle” for U.S.federal income tax purposes; 104 Table of Contents ●partnerships (including entities classified as partnerships for U.S. federal income tax purposes) or other pass-through entities, or holders thatwill hold our shares through such an entity; ●S corporations; ●persons that acquire ordinary shares as a result of holding or owning our preferred shares; ●persons whose “functional currency” is not the U.S. dollar; or ●persons that own directly, indirectly or through attribution 10% or more of the voting power or value of our shares. Moreover, this description does not address the U.S. federal estate, gift, or alternative minimum tax considerations, or any U.S. state, local or non-U.S. taxconsiderations of the ownership and disposition of our ordinary shares. This description is based on the U.S. Internal Revenue Code of 1986, as amended, or the Code, changes to the code based on the U.S. tax reform (as describedbelow) existing, proposed and temporary U.S. Treasury Regulations promulgated thereunder and administrative and judicial interpretations thereof, in eachcase as in effect and available on the date hereof. All the foregoing is subject to change, which change could apply retroactively, and to differinginterpretations, all of which could affect the tax considerations described below. There can be no assurances that the U.S. Internal Revenue Service, or theIRS, will not take a different position concerning the tax consequences of the ownership and disposition of our ordinary shares or that such a position wouldnot be sustained. Holders should consult their own tax advisers concerning the U.S. federal, state, local and foreign tax consequences of owning anddisposing of our ordinary shares in their particular circumstances. For purposes of this description, the term “U.S. Holder” means a beneficial owner of our ordinary shares that, for U.S. federal income tax purposes, is (i) acitizen or resident of the United States, (ii) a corporation (or entity treated as a corporation for U.S. federal income tax purposes) created or organized in orunder the laws of the United States, any state thereof, or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxregardless of its source, or (iv) a trust with respect to which a court within the United States is able to exercise primary supervision over its administration andone or more U.S. persons have the authority to control all of its substantial decisions. If a partnership (or any other entity treated as a partnership for U.S. federal income tax purposes) holds our ordinary shares, the U.S. federal income taxconsequences relating to an investment in our ordinary shares will depend in part upon the status of the partner and the activities of the partnership. Such apartner or partnership should consult its tax advisor regarding the U.S. federal income tax considerations of acquiring, owning and disposing of our ordinaryshares in its particular circumstances. As indicated below, this discussion is subject to U.S. federal income tax rules applicable to a “passive foreign investment company,” or a PFIC. Persons considering an investment in our ordinary shares should consult their own tax advisors as to the particular tax consequences applicable tothem relating to the ownership and disposition of our ordinary shares, including the applicability of U.S. federal, state and local tax laws and non-U.S.tax laws. Distributions Subject to the discussion under “—Passive Foreign Investment Company Considerations,” below, if you are a U.S. Holder, the gross amount of anydistribution made to you with respect to our ordinary shares before reduction for any Israeli taxes withheld therefrom, other than certain distributions, if any,of our ordinary shares distributed pro rata to all our shareholders, generally will be includible in your income as dividend income to the extent suchdistribution is paid out of our current or accumulated earnings and profits as determined under U.S. federal income tax principles. To the extent that theamount of any distribution by us exceeds our current and accumulated earnings and profits as determined under U.S. federal income tax principles, it willgenerally be treated first as a return of your adjusted tax basis in our ordinary shares and thereafter as either long-term or short-term capital gain dependingupon whether the U.S. Holder has held our ordinary shares for more than one year as of the time such distribution is received. We do not expect to maintaincalculations of our earnings and profits under U.S. federal income tax principles. Therefore, U.S. Holders should expect that the entire amount of anydistribution generally will be reported as dividend income. Non-corporate U.S. Holders may qualify for the preferential rates of taxation with respect todividends on ordinary shares applicable to long-term capital gains (i.e., gains from the sale of capital assets held for more than one year) applicable toqualified dividend income (as discussed below). The Company, which is incorporated under the laws of the State of Israel, believes that it qualifies as aresident of Israel for purposes of, and is eligible for the benefits of, the Convention between the Government of the United States of America and theGovernment of the State of Israel with Respect to Taxes on Income, signed on November 20, 1975, as amended and currently in force, or the U.S.-Israel TaxTreaty, although there can be no assurance in this regard. Further, the IRS has determined that the U.S.-Israel Tax Treaty is satisfactory for purposes of thequalified dividend rules and that it includes an exchange-of-information program. Therefore, subject to the discussion under “—Passive Foreign InvestmentCompany Considerations,” below, if the U.S.-Israel Tax Treaty is applicable, such dividends will generally be “qualified dividend income” in the hands ofindividual U.S. Holders, provided that certain conditions are met, including holding period and the absence of certain risk reduction transaction requirementsare met. The dividends will not be eligible for the dividends received deduction generally allowed to corporate U.S. Holders. On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act, or the TCJA. The TCJA provides a 100% deduction for the foreign-source portion of dividends received after January 1, 2018 from “specified 10-percent owned foreign corporations” by U.S. corporate holders, subject to aone-year holding period. No foreign tax credit, including Israeli withholding tax (or deduction for foreign taxes paid with respect to qualifying dividends)would be permitted for foreign taxes paid or accrued with respect to a qualifying dividend. Deduction would be unavailable for “hybrid dividends.” Thedividend received deduction enacted under the TCJA may not apply to dividends from a passive foreign investment company. 105 Table of Contents U.S. Holders, other than certain U.S. Holder’s that are U.S. corporations, generally may claim the amount of Israeli withholding tax withheld either as adeduction from gross income or as a credit against U.S. federal income tax liability. However, the foreign tax credit is subject to numerous complexlimitations that must be determined and applied on an individual basis. Generally, the credit cannot exceed the proportionate share of a U.S. Holder’s U.S.federal income tax liability that such U.S. Holder’s “foreign source” taxable income bears to such U.S. Holder’s worldwide taxable income. In applying thislimitation, a U.S. Holder’s various items of income and deduction must be classified, under complex rules, as either “foreign source” or “U.S. source.” Inaddition, this limitation is calculated separately with respect to specific categories of income. The amount of a distribution with respect to the ordinary sharesthat is treated as a “dividend” may be lower for U.S. federal income tax purposes than it is for Israeli income tax purposes, potentially resulting in a reducedforeign tax credit for the U.S. Holder. Each U.S. Holder should consult its own tax advisors regarding the foreign tax credit rules. In general, the amount of a distribution paid to a U.S. Holder in a foreign currency will be the dollar value of the foreign currency calculated by reference tothe spot exchange rate on the day the U.S. Holder receives the distribution, regardless of whether the foreign currency is converted into U.S. dollars at thattime. Any foreign currency gain or loss a U.S. Holder realizes on a subsequent conversion of foreign currency into U.S. dollars will be U.S. source ordinaryincome or loss. If dividends received in foreign currency are converted into U.S. dollars on the day they are received, a U.S. Holder generally should not berequired to recognize foreign currency gain or loss in respect of the dividend. Sale, Exchange or Other Taxable Disposition of Our Ordinary Shares Subject to the discussion below under “—Passive Foreign Investment Company Considerations,” if you are a U.S. Holder, you generally will recognize gainor loss on the sale, exchange or other taxable disposition of our ordinary shares equal to the difference between the amount realized on such sale, exchange orother taxable disposition and your adjusted tax basis in our ordinary shares, and such gain or loss will be capital gain or loss. The adjusted tax basis in anordinary share generally will be equal to the cost of such ordinary share. If you are a non-corporate U.S. Holder, capital gain from the sale, exchange or othertaxable disposition of ordinary shares is generally eligible for a preferential rate of taxation applicable to capital gains, if your holding period determined atthe time of such sale, exchange or other taxable disposition for such ordinary shares exceeds one year (i.e., such gain is long-term capital gain). Thedeductibility of capital losses for U.S. federal income tax purposes is subject to limitations under the Code. Any such gain or loss that a U.S. Holderrecognizes generally will be treated as U.S. source income or loss for foreign tax credit limitation purposes. 106 Table of Contents For a cash basis taxpayer, units of foreign currency paid or received are translated into U.S. dollars at the spot rate on the settlement date of the purchase orsale. In that case, no foreign currency exchange gain or loss will result from currency fluctuations between the trade date and the settlement date of such apurchase or sale. An accrual basis taxpayer, however, may elect the same treatment required of cash basis taxpayers with respect to purchases and sales of ourordinary shares that are traded on an established securities market, provided the election is applied consistently from year to year. Such election may not bechanged without the consent of the IRS. For an accrual basis taxpayer who does not make such election, units of foreign currency paid or received aretranslated into U.S. dollars at the spot rate on the trade date of the purchase or sale. Such an accrual basis taxpayer may recognize exchange gain or loss basedon currency fluctuations between the trade date and the settlement date. Any foreign currency gain or loss a U.S. Holder realizes will be U.S. source ordinaryincome or loss. Passive Foreign Investment Company Considerations If we are classified as a PFIC in any taxable year, a U.S. Holder would be subject to special rules generally intended to reduce or eliminate any benefits fromthe deferral of U.S. federal income tax that a U.S. Holder could derive from investing in a non-U.S. company that does not distribute all of its earnings on acurrent basis. A non-U.S. corporation is classified as a PFIC for U.S. federal income tax purposes in any taxable year in which, after applying certain look-through rules withrespect to the income and assets of subsidiaries, either (i) at least 75% of its gross income is “passive income” or (ii) at least 50% of the average quarterlyvalue of its total gross assets (which, assuming we are not a CFC for the year being tested, would be measured by fair market value of the assets, and for whichpurpose the total value of our assets may be determined in part by the market value of our ordinary shares, which is subject to change) is attributable to assetsthat produce “passive income” or are held for the production of passive income. Passive income for this purpose generally includes dividends, interest, royalties, rents, gains from commodities and securities transactions, the excess of gainsover losses from the disposition of assets which produce passive income, and includes amounts derived by reason of the temporary investment of funds raisedin offerings of our ordinary shares. If a non-U.S. corporation owns directly or indirectly at least 25% by value of the stock of another corporation, the non-U.S.corporation is treated for purposes of the PFIC tests as owning its proportionate share of the assets of the other corporation and as receiving directly itsproportionate share of the other corporation’s income. If we are classified as a PFIC in any year with respect to which a U.S. Holder owns our ordinary shares,we will continue to be treated as a PFIC with respect to such U.S. Holder in all succeeding years during which the U.S. Holder owns our ordinary shares,regardless of whether we continue to meet the tests described above. We must determine our PFIC status annually based on tests which are factual in nature, and our status will depend on our income, assets and activities eachyear. However, we believe that we were not a PFIC for our 2017 taxable year, but we expect that unless and until we generate sufficient revenue from activelicensing and other non-passive sources and otherwise satisfy the asset test above, we will be treated as a PFIC in future taxable years. If we are a PFIC, and you are a U.S. Holder, then unless you make one of the elections described below, a special tax regime will apply to both (a) any “excessdistribution” by us to you (generally, your ratable portion of distributions in any year which are greater than 125% of the average annual distributionreceived by you in the shorter of the three preceding years or your holding period for our ordinary shares) and (b) any gain realized on the sale or otherdisposition of the ordinary shares. Under this regime, any excess distribution and realized gain will be treated as ordinary income and will be subject to tax asif (a) the excess distribution or gain had been realized ratably over your holding period, (b) the amount deemed realized in each year had been subject to taxin each year of that holding period at the highest marginal rate for such year (other than income allocated to the current period or any taxable period beforewe became a PFIC, which would be subject to tax at the U.S. Holder’s regular ordinary income rate for the current year and would not be subject to the interestcharge discussed below), and (c) the interest charge generally applicable to underpayments of tax had been imposed on the taxes deemed to have beenpayable in those years. In addition, dividend distributions made to you will not qualify for the lower rates of taxation applicable to long-term capital gainsdiscussed above under “Distributions.” 107 Table of Contents Certain elections may potentially be used to reduce the adverse impact of the PFIC rules on U.S. Holders (“qualifying electing fund” (“QEF”) and “mark-to-market” elections), but these elections may accelerate the recognition of taxable income and may result in the recognition of ordinary income. The rules described above for excess distributions would not apply to a U.S. Holder if the U.S. Holder makes a timely QEF election for the first taxable year ofthe U.S. Holder’s holding period for ordinary shares and we comply with specified reporting requirements. A timely QEF election for a taxable year generallymust be made on or before the due date (as may be extended) for filing the taxpayer’s U.S. federal income tax return for the year. A U.S. Holder who makes aQEF election generally must report on a current basis a pro rata share of our ordinary earnings and net capital gain for any taxable year in which we are aPFIC, whether or not those earnings or gains are distributed. A U.S. Holder who makes a QEF election must file a Form 8621 with its annual income tax return.We have not historically provided the information necessary for U.S. Holders to make qualified electing fund elections. However, beginning with our 2016taxable year, for U.S. Holders who seek to make a QEF election with respect to our ordinary shares, we intend to make available an information statement thatwill contain the necessary information required for making a QEF election and permit such U.S. Holders access to certain information in the event of an auditby the U.S. tax authorities. If a U.S. Holder does not make a QEF election for the first taxable year of the U.S. Holder’s holding period for ordinary shares during which we are a PFIC, theQEF election will not be treated as timely and the adverse tax regime described above would apply to dispositions of or excess distributions on the ordinaryshares. In such case, a U.S. Holder may make a deemed sale election whereby the U.S. Holder would be treated as if the U.S. Holder had sold the ordinaryshares in a fully taxable sale at fair market value on the first day of such taxable year in which the QEF election takes effect. Such U.S. Holder would berequired to recognize any gain on the deemed sale as an excess distribution and pay any tax and interest due on the excess distribution when making thedeemed sale election. The effect of such further election would be to restart the U.S. Holder’s holding period in the ordinary shares, subject to the QEF regime,and to purge the PFIC status of such ordinary shares going forward. If a U.S. Holder makes the mark-to-market election, the U.S. Holder generally will recognize as ordinary income any excess of the fair market value of theordinary shares at the end of each taxable year over their adjusted tax basis, and will recognize an ordinary loss in respect of any excess of the adjusted taxbasis of the ordinary shares over their fair market value at the end of the taxable year (but only to the extent of the net amount of income previously includedas a result of the mark-to-market election). If a U.S. Holder makes the election, the U.S. Holder’s tax basis in the ordinary shares will be adjusted to reflectthese income or loss amounts. Any gain recognized on the sale or other disposition of ordinary shares in a year when we are a PFIC will be treated as ordinaryincome and any loss will be treated as an ordinary loss (but only to the extent of the net amount of income previously included as a result of the mark-to-market election). The mark-to-market election is available only if we are a PFIC and our ordinary shares are “regularly traded” on a “qualified exchange.” Ourordinary shares will be treated as “regularly traded” in any calendar year in which more than a de minimis quantity of the ordinary shares are traded on aqualified exchange on at least 15 days during each calendar quarter (subject to the rule that trades that have as one of their principle purposes the meeting ofthe trading requirement as disregarded). The NASDAQ Global Market is a qualified exchange for this purpose and, consequently, if the ordinary shares areregularly traded, the mark-to-market election will be available to a U.S. Holder. U.S. Holders should consult their tax advisors to determine whether any of these elections would be available and if so, what the consequences of thealternative treatments would be in their particular circumstances. If we are a PFIC, the general tax treatment for U.S. Holders described in this section would apply to indirect distributions and gains deemed to be realized byU.S. Holders in respect of any of our subsidiaries that also may be determined to be PFICs. 108 Table of Contents If a U.S. Holder owns ordinary shares during any year in which we are a PFIC and the U.S. Holder recognizes gain on a disposition of our ordinary shares orreceives distributions with respect to our ordinary shares, the U.S. Holder generally will be required to file an IRS Form 8621 (Information Return by aShareholder of a Passive Foreign Investment Company or Qualified Electing Fund) with respect to the company, generally with the U.S. Holder’s federalincome tax return for that year. If our company were a PFIC for a given taxable year, then you should consult your tax advisor concerning your annual filingrequirements. The U.S. federal income tax rules relating to PFICs are complex. Prospective U.S. investors are urged to consult their own tax advisers with respect tothe ownership and disposition of our ordinary shares, the consequences to them of an investment in a PFIC, any elections available with respect to ourordinary shares and the IRS information reporting obligations with respect to the ownership and disposition of our ordinary shares. Medicare Tax Certain U.S. Holders that are individuals, estates or trusts may be required to pay an additional 3.8% Medicare tax on all or a portion of their “net investmentincome,” which may include all or a portion of their dividend income and net gains from the disposition of ordinary shares. U.S. Holders will likely not beable to credit foreign taxes against the 3.8% Medicare tax. Each U.S. Holder that is an individual, estate or trust is urged to consult its tax advisors regardingthe applicability of the Medicare tax to its income and gains in respect of its investment in our ordinary shares. Backup Withholding Tax and Information Reporting Requirements U.S. backup withholding tax and information reporting requirements may apply to certain payments to certain shareholders. Information reporting generallywill apply to payments of dividends on, and to proceeds from the sale or redemption of, our ordinary shares made within the United States, or by a U.S. payoror U.S. middleman, to a holder of our ordinary shares, other than an exempt recipient (including a payee that is not a U.S. person that provides an appropriatecertification and certain other persons). A payor may be required to withhold backup withholding tax from any payments of dividends on, or the proceedsfrom the sale or redemption of, ordinary shares within the United States, or by a U.S. payor or U.S. middleman, to a holder, other than an exempt recipient, ifsuch holder fails to furnish its correct taxpayer identification number or otherwise fails to comply with, or establish an exemption from, such backupwithholding tax requirements. Any amounts withheld under the backup withholding rules should generally be allowed as a credit against the beneficialowner’s U.S. federal income tax liability, if any, and any excess amounts withheld under the backup withholding rules may be refunded, provided that therequired information is timely furnished to the IRS. Foreign Asset Reporting Certain U.S. Holders who are individuals may be required to report information relating to an interest in our ordinary shares, subject to certain exceptions(including an exception for shares held in accounts maintained by U.S. financial institutions) by filing IRS Form 8938 (Statement of Specified ForeignFinancial Assets) with their federal income tax return. U.S. Holders are urged to consult their tax advisors regarding their information reporting obligations, ifany, with respect to their ownership and disposition of our ordinary shares. Foreign Account Tax Compliance Act The Foreign Account Tax Compliance Act (“FATCA”) encourages foreign financial institutions to report information about their U.S. account holders(including holders of certain equity interests) to the IRS. Foreign financial institutions that fail to comply with the withholding and reporting requirements ofFATCA and certain account holders that do not provide sufficient information under the requirements of FATCA are subject to a 30% U.S. withholding taxon certain payments they receive, including foreign passthru payments (which may include payments made by us with respect to our ordinary shares). Theterm “foreign passthru payment” is not currently defined in U.S. Treasury Regulations, and therefore, the future application of FATCA withholding tax onforeign pass-thru payments to holders of ordinary shares is uncertain. If a holder of ordinary shares is subject to withholding, there will be no additionalamounts payable by way of compensation to the holder of such securities for the deducted amount. Holders of ordinary shares should consult their own taxadvisors regarding this legislation in light of such holder’s particular situation. THE DISCUSSION ABOVE IS A GENERAL SUMMARY. IT DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO APROSPECTIVE INVESTOR. EACH PROSPECTIVE INVESTOR IS URGED TO CONSULT ITS OWN TAX ADVISOR ABOUT THE TAXCONSEQUENCES TO IT OF AN INVESTMENT IN ORDINARY SHARES IN LIGHT OF THE INVESTOR’S OWN CIRCUMSTANCES. F. Dividends and Paying Agents Not applicable. 109 Table of Contents G. Statement by Experts Not applicable. H. Documents on Display You may inspect our securities filings, including this Annual Report and the exhibits and schedules thereto, without charge at the offices of the SEC at 100 FStreet, N.E., Washington, D.C. 20549. You may obtain copies of all or any part of the Annual Report from the Public Reference Section of the SEC, 100 FStreet, NE, Washington, D.C. 20549 upon the payment of the prescribed fees. You may obtain information on the operation of the Public Reference Room bycalling the SEC at 1-800-SEC-0330. The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and otherinformation regarding registrants like us that file electronically with the SEC. You can also inspect the Annual Report on this website. A copy of each document (or a translation thereof to the extent not in English) concerning our company that is referred to in this Annual Report is availablefor public view (subject to confidential treatment of certain agreements pursuant to applicable law) at our principal executive offices. I. Subsidiary Information Not applicable. Item 11. Quantitative and Qualitative Disclosures About Market Risk We are exposed to market risks in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due toadverse changes in financial market prices and rates. Our market risk exposure is primarily a result of foreign currency exchange rates. Approximately 23% ofour expenses in 2017 were denominated in New Israeli Shekels. Changes of 5% in the US$/NIS exchange rate will increase or decrease the operating expensesby up to 1%. Foreign Currency Risk Fluctuations in exchange rates, especially the NIS against the U.S. dollar, may affect our results, as some of our assets are linked to NIS, as are some of ourliabilities. In addition, the fluctuation in the NIS exchange rate against the U.S. dollar may impact our results, as a portion of our operating costs are NISdenominated. The following table presents information about the changes in the exchange rates of the NIS against the U.S. dollar at year end: Period % Year ended December 31, 2017 1.5%Year ended December 31, 2016 1.5%Year ended December 31, 2015 (0.33%) Inflation Risk We do not believe that inflation had a material effect on our business, financial condition or results of operations in the last three fiscal years. If our costs wereto become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through hedging transactions. Our inability orfailure to do so could harm our business, financial condition and results of operations. Item 12. Description of Securities Other Than Equity Securities Not applicable. 110 Table of Contents PART II Item 13. Defaults, Dividend Arrearages and Delinquencies Not applicable. Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds Use of Proceeds from Initial Public Offering On October 6, 2014, we completed an initial public offering in the United States on the NASDAQ Global Market of our ordinary shares, par value NIS 0.01per share. Pursuant to the initial public offering, we sold a total of 6,760,418 ordinary shares (including the shares sold pursuant to the over-allotment option)at a price of $6.00 per share. The aggregate offering price of the shares sold (including the over-allotment option) was approximately $40.5 million. The netproceeds we received from the offering (including the over-allotment option) were approximately $34.9 million. As of December 31, 2017, we had used all of the net proceeds of our initial public offering. None of the proceeds from our initial public offering were used fordirect or indirect payments to our directors, officers or their associates, or to persons owning 10% or more of our equity securities, or to our affiliates. Item 15. Controls and Procedures Disclosure Controls and Procedures We have performed an evaluation of the effectiveness of our disclosure controls and procedures that are designed to ensure that the material financial andnon-financial information required to be disclosed to the SEC is recorded, processed, summarized and reported timely. Based on our evaluation, ourmanagement, including the Chief Executive Officer, or CEO and the Chief Financial Officer, or CFO, has concluded that our disclosure controls andprocedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended) as of the end of the period covered by thisreport are effective. Notwithstanding the foregoing, there can be no assurance that our disclosure controls and procedures will detect or uncover all failures ofpersons within the Company to disclose material information otherwise required to be set forth in our reports. Management’s Annual Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f)promulgated under the Exchange Act. Our internal control system was designed to provide reasonable assurance to our management and board of directorsregarding the reliability of financial reporting and the preparation and fair presentation of published financial statements for external purposes in accordancewith generally accepted accounting principles. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even thosesystems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation and may notprevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may becomeinadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate. Our management, including our CEO and CFO, conducted an evaluation, pursuant to Rule 13a-15(c) promulgated under the Exchange Act, of theeffectiveness, as of the end of the period covered by this Annual Report, of its internal control over financial reporting based on the framework in InternalControl—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013). Based on the results of thisevaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2017. 111 Table of Contents Report of the Independent Accounting Firm This annual report does not include an attestation report of the Company’s registered public accounting firm because management’s report was not subject toattestation by our independent registered public accounting firm as emerging growth companies are exempt from this requirement. Changes in Internal Control over Financial Reporting Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or ourinternal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, notabsolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls canprovide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations includethe realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls canbe circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of anysystem of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design willsucceed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, orthe degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatementsdue to error or fraud may occur and not be detected. There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurredduring the year ended December 31, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financialreporting. Item 16. [Reserved] Item 16A. Audit committee financial expert All members of our audit committee meet the requirements for financial literacy under the applicable rules and regulations of the Securities and ExchangeCommission and the NASDAQ corporate governance rules. Our board of directors has determined that Mr. Philip A. Serlin is the audit committee financialexpert as defined by the Securities and Exchange Commission rules, has the requisite financial experience and is independent as defined by the NASDAQcorporate governance rules. Item 16B. Code of Ethics We have adopted a Code of Business Conduct and Ethics applicable to all of our directors and employees, including our Chief Executive Officer, ChiefFinancial Officer, controller or principal accounting officer, or other persons performing similar functions, which is a “code of ethics” as defined in this Item16B of Form 20-F promulgated by the SEC. The full text of the Code of Business Conduct and Ethics is posted on our website at www.vblrx.com Informationcontained on, or that can be accessed through, our website does not constitute a part of this Form 20-F and is not incorporated by reference herein. If we makeany amendment to the Code of Business Conduct and Ethics or grant any waivers, including any implicit waiver, from a provision of the code of ethics, wewill disclose the nature of such amendment or waiver on our website to the extent required by the rules and regulations of the SEC. 112 Table of Contents Item 16C. Principal Accountant Fees and Services The following table sets forth, for each of the years indicated, the fees billed by Kesselman & Kesselman, a member firm of PricewaterhouseCoopersInternational Ltd., our independent registered public accounting firm: Year Ended December 31, 2017 2016 (in thousands) Service rendered Audit Fees (1) $145.0 $127.5 Audit-Related Fees (2) — — Tax Fees (3) 31.0 5 All Other Fees — — Total $176.0 $132.5 (1)Audit fees consist of services that would normally be provided in connection with statutory and regulatory filings or engagements, including servicesthat generally only the independent accountant can reasonably provide, including work regarding the public listing or offering during 2016 and 2017.(2)Audit related services relate to reports to the IIA.(3)Tax fees relate to tax compliance, planning and advice. Our board of directors reviews and pre-approves all audit services and permitted non-audit services (including the fees and other terms) to be provided by ourindependent auditors. Item 16D. Exemptions from the Listing Standards for Audit Committees Not applicable. Item 16E. Purchase of Equity Securities by the Issuer and Affiliated Purchasers In the year ended December 31, 2017, neither we nor any affiliated purchaser (as defined in the Exchange Act) purchased any of our ordinary shares. Item 16F. Change in Registrant’s Certifying Accountant None. Item 16G. Corporate Governance As a foreign private issuer whose shares are listed on the NASDAQ Global Market, we have the option to follow certain Israeli corporate governance practicesrather than those of NASDAQ, except to the extent that such laws would be contrary to U.S. securities laws and provided that we disclose the practices we arenot following and describe the home country practices we follow instead. We rely on this “foreign private issuer exemption” with respect to the followingNASDAQ requirements: ●Quorum requirement. Under our articles of association and as permitted under the Companies Law, a quorum for any meeting ofshareholders shall be the presence of at least two shareholders present in person, by proxy or by a voting instrument, who hold at least 25%of the voting power of our shares instead of 33 1 ⁄ 3 % of the issued share capital required under Nasdaq requirements. 113 Table of Contents Except as stated above, we comply with the rules generally applicable to U.S. domestic companies listed on NASDAQ, subject to certain exemptions theJOBS Act provides to emerging growth companies. We may in the future elect to follow home country practices in Israel with regard to other matters,including the formation of compensation, nominating and corporate governance committees, separate executive sessions of independent directors and non-management directors and the requirement to obtain shareholder approval for certain dilutive events (such as for the establishment or amendment of certainequity-based compensation plans, issuances that will result in a change of control of the company, certain transactions other than a public offering involvingissuances of a 20% or more interest in the company and certain acquisitions of the stock or assets of another company). Following our home country governance practices, as opposed to the requirements that would otherwise apply to a company listed on NASDAQ, may provideless protection than is accorded to investors under NASDAQ listing requirements applicable to domestic issuers. For more information, see “Item 3. RiskFactors—We are an ‘emerging growth company’ and a ‘foreign private issuer,’ and we cannot be certain if the reduced reporting requirements applicable toemerging growth companies and foreign private issuers will make our ordinary shares less attractive to investors” and “Risk Factors—We are a ‘foreignprivate issuer’ and intend to follow certain home country corporate governance practices, and our shareholders may not have the same protections afforded toshareholders of companies that are subject to all NASDAQ corporate governance requirements.” We will also be required to comply with Israeli corporategovernance requirements under the Companies Law applicable to Israeli public companies such as us whose shares are also listed for trade on an exchangeoutside Israel. Item 16H. Mine Safety Disclosure Not applicable. 114 Table of Contents PART III Item 17. Financial Statements Financial Statements are set forth under Item 18. Item 18. Financial Statements Our Financial Statements beginning on pages F-1 through F-7, as set forth in the following index, are incorporated herein by reference. These FinancialStatements are filed as part of this Annual Report. PageREPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM F-2STATEMENTS OF FINANCIAL POSITION F-3STATEMENTS OF COMPREHENSIVE LOSS F-4STATEMENTS OF CHANGES IN EQUITY F-5STATEMENTS OF CASH FLOWS F-7NOTES TO THE FINANCIAL STATEMENTS F-8 F-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders of VASCULAR BIOGENICS LTD Opinion on the Financial Statements We have audited the accompanying statements of financial position of Vascular Biogenics Ltd. as of December 31, 2017 and 2016, and the related statementsof comprehensive loss, changes in equity and cash flows for each of the three years in the period ended December 31, 2017, including the related notes(collectively referred to as the “ financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position ofthe Company as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the three years in the period ended December31, 2017 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Basis for Opinion These financial statements are the responsibility of the Company’s management and board of directors. Our responsibility is to express an opinion on theCompany’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board(United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and theapplicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform theaudit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company isnot required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtainan understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internalcontrol over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, andperforming procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures inthe financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well asevaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Tel-Aviv, Israel /s/ Kesselman & KesselmanMarch 12, 2018 Certified Public Accountants (lsr.) A member firm of PricewaterhouseCoopers International Limited We have served as the Company’s auditor since 2001. Kesselman & Kesselman, Trade Tower, 25 Hamered Street, Tel-Aviv 6812508, Israel,P.O. Box 50005 Tel-Aviv 6150001 Telephone: +972 -3-7954555, Fax: +972 -3- 7954556, www.pwc.com/il F-2 Table of Contents VASCULAR BIOGENICS LTD. STATEMENTS OF FINANCIAL POSITION December 31 Note 2017 2016 U.S. dollars in thousands Assets CURRENT ASSETS: Cash and cash equivalents $6,694 $11,585 Short-term bank deposits 5 48,035 33,669 Trade receivables 8 2,000 — Other current assets 12a 1,729 1,320 TOTAL CURRENT ASSETS 58,458 46,574 NON-CURRENT ASSETS: Property and equipment, net 6 7,128 687 Long-term prepaid expenses 103 13 TOTAL NON-CURRENT ASSETS 7,231 700 TOTAL ASSETS $65,689 $47,274 Liabilities and equity CURRENT LIABILITIES— Accounts payable: Trade $3,058 $2,522 Other 12b 3,465 2,266 Deferred revenue 8 1,046 — TOTAL CURRENT LIABILITIES 7,569 4,788 NON-CURRENT LIABILITIES— Severance pay obligations, net 7 128 86 Deferred revenue 8 2,092 — TOTAL NON-CURRENT LIABILITIES 2,220 86 TOTAL LIABILITIES 9,789 4,874 COMMITMENTS 9 EQUITY: 10 Ordinary shares, NIS 0.01 par value; Authorized as of December 31, 2017and 2016, 70,000,000 shares; issued and outstanding as of December 31,2017 and 2016, 29,879,323 and 26,902,285 shares, respectively 57 50 Accumulated other comprehensive income 16 40 Additional paid in capital 221,055 197,400 Warrants 2,960 2,960 Accumulated deficit (168,188) (158,050) TOTAL EQUITY 55,900 42,400 TOTAL LIABILITIES AND EQUITY $65,689 $47,274 The accompanying notes are an integral part of the financial statements. F-3 Table of Contents VASCULAR BIOGENICS LTD. STATEMENTS OF COMPREHENSIVE LOSS Year ended December 31 Note 2017 2016 2015 U.S. dollars in thousands REVENUES 8 13,864 — — COST OF REVENUES 9c (340) — — GROSS PROFIT 13,524 — — RESEARCH AND DEVELOPMENTEXPENSES, net 12c $17,770 $12,447 $11,198 MARKETING EXPENSES 12e 562 — — GENERAL AND ADMINISTRATIVEEXPENSES 12d 5,847 3,828 3,673 OPERATING LOSS 10,655 16,275 14,871 FINANCIAL INCOME 14 (544) (285) (100)FINANCIAL EXPENSES 14 27 12 117 FINANCIAL EXPENSES (INCOME), net (517) (273) 17 LOSS FOR THE YEAR 10,138 16,002 14,888 OTHER COMPREHENSIVE LOSS (INCOME)— Items that will not be reclassified to profit orloss— Re-measurements of post-employment benefitobligation 24 5 (6) COMPREHENSIVE LOSS $10,162 $16,007 $14,882 U.S. dollars LOSS PER ORDINARY SHARE 13 Basic and diluted $0.37 $0.64 $0.73 Number of shares WEIGHTED AVERAGE ORDINARY SHARESOUTSTANDING— Basic and diluted 27,398,169 24,970,585 20,309,596 The accompanying notes are an integral part of the financial statements. F-4 Table of Contents (Continued)—1 VASCULAR BIOGENICS LTD. STATEMENTS OF CHANGES IN EQUITY Number ofordinaryshares Ordinaryshares Accumulatedothercomprehensiveincome Additionalpaid incapital Warrants Accumulateddeficit Totalequity U.S. dollars in thousands BALANCE AT JANUARY 1, 2015 19,898,674 $32 $39 $162,191 — (127,160) $35,102 CHANGES DURING THE YEARENDED DECEMBER 31, 2015: Comprehensive income (loss) — — 6 — — (14,888) (14,882) Employee stock options exercised 71,647 * — 95 — — 95 Issuance of ordinary shares andwarrants, net of issuance costs inamount of $1,349 thousand 2,500,000 6 — 10,685 2,960 — 13,651 Share based payments to employeesand non-employees services — — — 1,041 — — 1,041 BALANCE AT DECEMBER 31,2015 22,470,321 $38 $45 $174,012 2,960 $(142,048) $35,007 CHANGES DURING THE YEARENDED DECEMBER 31, 2016 Comprehensive Loss — — (5) — — (16,002) (16,007) Employee stock options exercised 72,873 * — 121 — — 121 Issuance of ordinary Shares, net ofissuance costs of $2,117 thousand 4,359,091 12 — 21,847 — — 21,859 Share based payments to employeesand non-employees services — — — 1,420 — — 1,420 BALANCE AT DECEMBER 31,2016 26,902,285 $50 $40 $197,400 $2,960 $(158,050) $42,400 *Amount less than $1 thousand F-5 Table of Contents (Concluded)—2 VASCULAR BIOGENICS LTD. STATEMENTS OF CHANGES IN EQUITY Number ofordinary shares Ordinary shares Accumulatedothercomprehensiveincome Additional paidin capital Warrants Accumulateddeficit Total equity U.S. dollars in thousands BALANCE AT DECEMBER 31, 2016 26,902,285 $50 $40 $197,400 $2,960 $(158,050) $42,400 CHANGES DURING THE YEARENDED DECEMBER 31, 2017: Comprehensive loss — — (24) — — (10,138) (10,162)Employee stock options exercised 252,343 * — 479 — — 479 Issuance of ordinary shares, net ofissuance costs in amount of $288thousand 2,724,695 7 — 19,024 — — 19,031 Share based payments to employeesand non-employees services — — — 4,152 — — 4,152 BALANCE AT DECEMBER 31, 2017 29,879,323 $57 $16 $221,055 2,960 $(168,188) $55,900 *Amount less than $1 thousand The accompanying notes are an integral part of the financial statements. F-6 Table of Contents VASCULAR BIOGENICS LTD. STATEMENTS OF CASH FLOWS Year ended December 31 2017 2016 2015 U.S. dollars in thousands CASH FLOWS FROM OPERATING ACTIVITIES: Loss for the year $(10,138) $(16,002) $(14,888)Adjustments required to reflect net cash used in operating activities(see Appendix A) 5,993 2,340 1,641 Interest received 324 250 44 Net cash used in operating activities (3,821) (13,412) (13,203) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (6,482) (491) (90)Investment in short-term bank deposits (81,332) (3,600) (30,000)Maturity of short-term deposits 66,974 — — Net cash used in from investing activities (20,840) (4,091) (30,090) CASH FLOWS FROM FINANCING ACTIVITIES: Exercise of employees stock options 479 121 95 Issuance of ordinary shares and warrants, net 19,031 21,859 13,651 Net cash generated from financing activities 19,510 21,980 13,746 NET INCREASE (DECREASE) IN CASH AND CASHEQUIVALENTS (5,151) 4,477 (29,547)CASH AND CASH EQUIVALENTS AT BEGINNING OF THE YEAR 11,585 7,090 36,783 EXCHANGE GAINS (LOSSES) ON CASH AND CASHEQUIVALENTS 260 18 (146)CASH AND CASH EQUIVALENTS AT END OF THE YEAR $6,694 $11,585 $7,090 APPENDIX A: Adjustments required to reflect net cash used in operating activities: Depreciation $156 $130 $122 Interest income (331) (263) (100)Exchange losses (gains) on cash and cash equivalents (260) (18) 146 Net changes in severance pay obligations 17 8 (27)Share based payments 4,152 1,420 1,041 3,734 1,277 1,182 Changes in working capital: Decrease (increase) in other current assets (409) 126 (485)Increase in trade receivables (2,000) — — Decrease (increase) in long term prepaid expenses (90) 307 (284)Increase (decrease) in accounts payable: Trade 421 472 1,355 Other 1,199 158 (127)Increase in deferred revenue 3,138 — — 2,259 1,063 459 $5,993 $2,340 $1,641 APPENDIX B: Non cash activity— Purchase of property and equipment in payables $115 The accompanying notes are an integral part of the financial statements. F-7 Table of Contents VASCULAR BIOGENICS LTD. NOTES TO THE FINANCIAL STATEMENTS NOTE 1—GENERAL INFORMATION: a.General Vascular Biogenics Ltd. (the “Company” or VBL) was incorporated on January 27, 2000. The Company is a late-stage clinical biopharmaceuticalcompany focused on the discovery, development and commercialization of first-in-class treatments for cancer. VBL has also developed a proprietaryplatform of small molecules, Lecinoxoids, for the treatment of chronic immune-related indications, and is also conducting a research program exploringthe potential of targeting of MOSPD2 for immuno-oncology and anti-inflammatory applications. VB-111 (ofranergene obadenovec), a Phase 3 drug candidate, is the Company’s lead product candidate in the Company’s cancer program. VB-201, a Phase2-ready drug candidate, is the Company’s lead Lecinoxoid-based product candidate. The Company’s “VB-600 series” for targeting of MOSPD2 is at pre-clinical stage. In 2015, the Company launched its Phase 3 clinical trial of VB-111 in rGBM, whereby the first patient was randomized in August 2015, and the trialenrollment was completed by December 2016. The Company is conducting its Phase 3 clinical trial of VB-111 in rGBM under a special protocolassessment concurred by the FDA. In November 2017, the Company entered into an exclusive license agreement with NanoCarrier Co., Ltd. for the development, commercialization, andsupply of ofranergene obadenovec (“VB-111”) in Japan for all indications, see notes 2(m) and 8. Since inception, the Company has incurred significant losses, and it expects to continue to incur significant expenses and losses for at least the nextseveral years. As of December 31, 2017, the Company had an accumulated deficit of $168.2 million. The Company’s losses may fluctuate significantlyfrom quarter to quarter and year to year, depending on the timing of its clinical trials, the receipt of payments under any future collaboration agreements itmay enter into, and its expenditures on other research and development activities. As of December 31, 2017, the Company had cash, cash equivalents and short-term bank deposits of $54.7 million. The Company may seek to raise morecapital to pursue additional activities. The Company may seek these funds through a combination of private and public equity offerings, governmentgrants, strategic collaborations and licensing arrangements. Additional financing may not be available when the Company needs it or may not be availableon terms that are favorable to the Company. b.Approval of financial statements These financial statements were approved by the Board of Directors on March 12, 2018. NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: a.Basis of preparation of the financial statements The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by theInternational Accounting Standards Board (“IASB”). The significant accounting policies described below have been applied consistently in relation to all the periods presented, unless otherwise stated. The financial statements have been prepared under the historical cost convention. The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management toexercise its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, orareas where assumptions and estimates are significant to the financial statements are disclosed in note 3. F-8 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Actual results could differ from those estimates and assumptions. b.Functional and presentation currency: 1)Functional and presentation currency Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the entityoperates (the “functional currency”). The financial statements are presented in U.S. dollar ($), which is the Company’s functional and presentationcurrency. 2)Transactions and balances Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. Foreign exchangegains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilitiesdenominated in foreign currencies are recognized in the income statement. All foreign exchange gains and losses are presented in the statements of comprehensive loss within financial income or expenses. c.Cash and cash equivalents Cash and cash equivalents include cash on hand and short-term bank deposits (with original maturities of three months or less) that are not restricted as towithdrawal or use, and are therefore considered to be cash equivalents. d.Property and equipment: 1)All property and equipment (including leasehold improvements) are stated at historical cost less accumulated depreciation and impairment.Historical cost includes expenditures that are directly attributable to the acquisition of the items. Repairs and maintenance are charged to the income statement during the period in which they are incurred. 2)The assets are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Annual rates of depreciation are as follows: % Laboratory equipment 9-15 Computers 25-33 Office furniture and equipment 7 Leasehold improvements in buildings under operating leases are depreciated using the straight-line method over the shorter of the term of the lease or theestimated useful life of the improvements. 3)Gains and losses on disposals are determined by comparing proceeds with the associated carrying amount. These are included in thestatements of comprehensive loss. F-9 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): e.Impairment of non-financial assets Assets that are subject to depreciation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may notbe recoverable. An impairment loss is recognized for the amount by which the asset carrying amount exceeds its recoverable amount. The recoverableamount is the higher of an asset fair value less costs to dispose and its value in use. For the purposes of assessing impairment, assets are grouped at thelowest levels for which there are separately identifiable cash flows (cash-generating units). Through December 31, 2017, no impairment has been recognized. f.Financial assets: 1)Classification The Company classifies its financial assets as “Loans and Receivables.” The classification depends on the purpose for which each financial asset wasacquired. The Company’s management determines the classification of financial assets at initial recognition. Receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The Company’s receivablesinclude “current assets (except for prepaid expense),” “cash and cash equivalents,” “short-term bank deposits and “trade receivables.” 2)Recognition and measurement Ordinary purchases of financial assets are recognized at the settlement date, the date on which the asset is delivered to or by the Company. Financial assets are derecognized when the rights to receive cash flows from the assets have expired or have been transferred and the Company hastransferred substantially all risks and rewards of ownership of the assets. The Company’s Loans and Receivables are initially recognized at fair value. 3)Impairment of financial assets The Company assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired.The amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excludingfuture credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The asset’s carrying amount is reducedand the amount of the loss is recognized in the statements of comprehensive loss. As of December 31, 2017, the Company has not recognized any impairment. g.Financial liabilities: F-10 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): Accounts payable Accounts payable are initially measured at fair value. In subsequent periods, the other financial liabilities are presented at amortized cost. Any differencebetween the consideration and the redemption value is accreted to profit or loss over the term of the liability, using the effective interest method. Financial liabilities are classified as current liabilities, unless the Company has an unconditional right to defer settlement of the liability for at least 12months after the end of the reporting period, in which case they are classified as noncurrent liabilities. h.Share capital Ordinary Shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are included in equity as a deductionfrom the proceeds. i.Deferred income tax Deferred taxes are recognized using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carryingamounts in the financial statements. Deferred income tax assets are recognized only to the extent that it is probable that future taxable income will be available against which the temporarydifferences can be utilized. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the balancesheet date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Due to absence of expectation of taxable income in the future, no deferred tax assets have been recorded in the Company’s financial statements. j.Employee benefits: 1)Post employment benefit obligation Israeli labor laws and the Company’s agreements require the Company to pay retirement benefits to employees terminated or leaving their employment incertain other circumstances. Most of the Company’s employees are covered by a defined contribution plan under Section 14 of the Israel Severance PayLaw from the beginning of their employment with the Company. With respect to the remaining employees, which are not covered by a defined contribution plan under Section 14 of the Israel Severance Pay Law onlyfrom January 1, 2010, the Company records a liability in its statement of financial position for defined benefit plans that represents the present value of thedefined benefit obligation as of the statement of financial position date, net of the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the definedbenefit obligation is determined by discounting the estimated future cash outflows using interest rates of highly rated corporate bonds that aredenominated in the currency in which the benefits will be paid (NIS) and that have terms to maturity approximating the terms of the related liability. Remeasurement gains and losses arising from adjustments to reflect actual experience and changes in actuarial assumptions are charged or credited toequity in other comprehensive loss (income) in the period in which they arise. F-11 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): 2)Vacation and recreation pay Under Israeli law, each employee is entitled to vacation days and recreation pay, both computed on an annual basis. The entitlement is based on the lengthof the employment period. The Company recognizes a liability and an expense for vacation and recreation pay based on the entitlement of each employee. k.Share-based payments The Company operates a number of equity-settled, share-based compensation plans to employees (as defined in IFRS 2 “Share-Based Payments”), directorsand service providers. As part of the plans, the Company grants employees, directors and service providers, from time to time and at its discretion, optionsand RSU’s to purchase Company shares. The fair value of the employee and service provider services received in exchange for the grant of the options andRSU’s are recognized as an expense in profit or loss and is recorded to Additional paid in capital within equity. The total amount recognized as an expenseover the vesting period of the options (the period during which all vesting conditions are expected to be met) was determined as follows: 1)Share based payments to employees and directors by reference to the fair value of the options and RSU’s granted at date of grant. 2)Share based payments to service providers by reference to the fair value of the service provided. Service conditions and performance vesting conditions are included in assumptions about the number of options and RSU’s that are expected to vest. Thetotal expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. Vesting conditions are included in assumptions about the number of options and RSU’s that are expected to vest. The total expense is recognized over thevesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the Company revises its estimates of the number of options and RSU’s that are expected to vest based on the vestingconditions. The Company recognizes the impact of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment toAdditional paid in capital. When options are exercised, the Company issues new shares, with proceeds less directly attributable transaction costs recognized as share capital (parvalue) and additional paid in capital. l.Provisions Provisions are recognized when the Company has a present legal or constructive obligation as a result of past events and it is probable that an outflow ofresources will be required to settle the obligation. Provisions are measured by discounting the future cash outflow at a pretax interest rate that reflectscurrent market assessments of the time value of money and the risks specific to the obligation. The carrying amount of the provision is adjusted in eachreporting period in order to reflect the passage of time and the changes in the carrying amounts are carried to the statement of comprehensive loss. As of December 31, 2017, no provisions have been recognized. m.Revenue from contracts with customers General In November 2017, the Company signed an exclusive license agreement with NanoCarrier Co. Ltd (hereinafter – “The License Agreement”), for thedevelopment, commercialization, and supply of VB-111 in Japan (see note 8 for further details). As of January 1, 2017, the Company early adopted IFRS 15, with full retrospective application. Since the Company has not generated revenues until 2017,the adoption of IFRS 15 did not have an effect on accumulated deficits as of January 1, 2015 nor on 2015’s and 2016’s comparatives. IFRS 15 introduces a five-step model for recognizing revenue from contracts with customers, as follows: 1.identify the contract with a customer; 2.identify the performance obligations in the contract; 3.determine the transaction price; 4.allocate the transaction price to the performance obligations in the contract; 5.recognize revenue when (or as) the entity satisfies a performance obligation. Revenues from licensing agreement According to IFRS 15, performance obligation is a promise to provide a distinct good or service or a series of distinct goods or services. Goods and servicesthat are not distinct are bundled with other goods or services in the contract until a bundle of goods or services that is distinct is created. A good or servicepromised to a customer is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readilyavailable to the customer and the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract. The Company has identified two performance obligations in The License Agreement: (1) Grant of the license and use of its IP; and (2) Company’sparticipation and consulting assistance services. In addition, there is a potential performance obligation regarding future manufacturing. IFRS 15 defines the ‘Transaction Price’ as the amount of consideration to which the entity expects to be entitled in exchange for transferring the promisedgoods or services to a customer. The Company allocates the transaction price to each performance obligation identified based on the standalone sellingprices of the goods or services being provided to the customer. The Grant of the license and use of its IP performance obligation considered to be a right to use IP in accordance with IFRS 15. Therefore, revenue isrecognized at a point in time, upon transfer of control over the license to the licensee. The Company’s participation and consulting assistance services performance obligation is recognized as revenue over the service period, based on inputmethod, which is costs incurred and labor hours expended. Revenue from achieving additional milestones is recognized only when it is highly probable that a significant reversal of cumulative revenues will not occur,usually upon achievement of the specific milestone. Sales-based royalties are not included in the transaction price. Rather, they are recognized as incurred, due to the specific exception of IFRS 15 for sales-based royalties in licensing of intellectual properties. F-12 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): n.Research and development expenses Research expenses are charged to profit or loss as incurred. An intangible asset arising from development of the Company’s products is recognized if all ofthe following conditions are met: ●It is technically feasible to complete the intangible asset so that it will be available for use; ●Management intends to complete the intangible asset and use it or sell it; ●There is an ability to use or sell the intangible asset; ●It can be demonstrated how the intangible asset will generate probable future economic benefits; ●Adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available; ●Costs associated with the intangible asset during development can be measured reliably. Other development costs that do not meet the above criteria are recognized as expenses as incurred. Development costs previously recognized as anexpense are not recognized as an asset in a subsequent period. As of December 31, 2017, the Company has not yet capitalized any development costs. o.Government grants Government grants, which are received from the Israeli Innovation Authority or IIA (formerly known as the Israeli Office of Chief Scientist, or the “OCS”)by way of participation in research and development that is conducted by the Company, fall within the scope of “forgivable loans,” as set forth inInternational Accounting Standard 20 “Accounting for Government Grants and Disclosure of Government Assistance” (“IAS 20”). As approved by the IIA, the grants are received in installments as the program progresses. The Company recognizes each forgivable loan on a systematicbasis at the same time the Company records, as an expense, the related research and development costs for which the grant is received, provided that thereis reasonable assurance that (a) the Company complies with the conditions attached to the grant, and (b) it is probable that the grant will be received(usually upon receipt of approval notice). The amount of the forgivable loan is recognized based on the participation rate approved by the IIA; thus, aforgivable loan is recognized as a receivable when approved research and development costs have been incurred before grant funds are received. Since at the time of grant approval there is reasonable assurance that the Company will comply with the forgivable loan conditions attached to the grant,and it is reasonably assured that the Company will not pay royalties to IIA, grant income is recorded against the related research and developmentexpenses in the statements of comprehensive loss. If forgivable loans are initially carried to income, as described above, and in subsequent periods it is no longer reasonably assured that royalties will not bepaid to the IIA, the Company recognizes a liability that is measured based on the Company’s best estimate of the amount required to settle the Company’sobligation at the end of each reporting period. p.Operating lease Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments madeunder operating leases are charged to the statements of comprehensive loss on a straight-line basis over the period of the lease. F-13 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued): q.Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker, who is responsible forallocating resources and assessing performance of the operating segments. The Company operates in one operating segment. r.Loss per Ordinary Share Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of Ordinary Sharesissued and outstanding during the year. The diluted loss per share is calculated by adjusting the weighted average number of outstanding Ordinary Shares, assuming conversion of all dilutivepotential shares. The Company’s dilutive potential shares consist of options and RSU’s granted to employees and service providers and warrants. The dilutive potential shares were not taken into account in computing loss per share in 2017, 2016, and 2015 as their effect would not have been dilutive. s.The following new standard has been issued, but is not effective for the financial periods beginning January 1, 2017, and has not been earlyadopted: 1.IFRS 9, Financial Instruments, addresses the classification, measurement and recognition of financial assets and financial liabilities. Thecomplete version of IFRS 9 was issued in July 2014. It replaces the guidance in IAS 39 that relates to the classification and measurement offinancial instruments. IFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories forfinancial assets: amortized cost, fair value through other comprehensive income and fair value through profit or loss. There is now a newexpected credit losses model that replaces the incurred loss impairment model used in IAS 39. For financial liabilities, there were no changesto classification and measurement except for the recognition of changes in own credit risk in other comprehensive loss (income) for liabilitiesdesignated at fair value through profit or loss. The standard is effective for accounting periods beginning on or after January 1, 2018. Earlyadoption is permitted. IFRS 9 is to be applied retrospectively. The Company concluded that IFRS 9 would not have material impact on thefinancial statements. 2.In January 2016, the IASB issued IFRS 16—Leases which sets out the principles for the recognition, measurement, presentation anddisclosure of leases for both parties to a contract and replaces the previous leases standard, IAS 17—Leases. IFRS 16 eliminates theclassification of leases for the lessee as either operating leases or finance leases as required by IAS 17 and instead introduces a single lesseeaccounting model whereby a lessee is required to recognize assets and liabilities for all leases with a term that is greater than 12 months,unless the underlying asset is of low value, and to recognize depreciation of leases assets separately from interest on lease liabilities in thestatements of comprehensive loss. As IFRS 16 substantially carries forward the lessor accounting requirements in IAS 17, a lessor willcontinue to classify its leases as operating leases or finance leases and to account for those two types of leases differently. IFRS 16 is effectivefrom January 1, 2019 with early adoption allowed only if IFRS 15—Revenue from Contracts with Customers is also applied. The Company iscurrently evaluating the impact of adoption on its Financial Statements. t.Trade receivables Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of business. If collection ofthe amounts is expected in one year or less, they are classified as current assets. The Company’s impairment for trade and other receivablesare outlined in note 2(f)(3). F-14 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 3—SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events thatare believed to be reasonable under the circumstances. The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the relatedactual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilitieswithin the next financial year are discussed below: Revenue In 2017, the Company signed a license and supply agreement as more fully described in note 8. In determining the amounts to be recognized as revenue,the Company used its judgement in the following main issues: Identifying the performance obligations in the agreement and determining whether the license provided is distinct - based on the Company's analysis, thelicense is distinct as the licensee is able to benefit from the license on its own at its current stage (inter alia, due to sublicensing rights, rights andresponsibility for development in the territory, etc.). Allocation of the transaction price – the Company estimated the standalone selling prices of the services to be provided based on expected cost plus amargin and used the residual approach to estimate the standalone selling price of the license as the Company has not yet established a price for the license,and it has not previously been sold on a standalone basis. Variable consideration consists of potential future milestone payments. The Company determined that all such variable consideration shall be allocated tothe license (the satisfied performance obligation). Share-based payments With respect to grants to employees, the value of the labor services received from them in return is measured on the date of grant based on the fair value ofthe equity instruments granted to the employees. For options granted prior to the Company’s IPO in order to measure the fair value of the labor servicereceived, the Company first measured the share value by using the income approach method, which is an analysis that involves forecasting the appropriatecash flow stream over an appropriate period and then discounting it back to a present value at an appropriate discount rate. This discount rate shouldconsider the time value of money, inflation, and the risk inherent in ownership of the asset or security interest being valued. Once the share value wasestimated, the Company used the Black-Scholes model to value the equity instrument. Since the Company was not publicly traded, it looked forcomparable companies in the healthcare sector to set the volatility assumption and estimated the equity instrument’s life. For options granted since 2015,the expected volatility was calculated using weighted average and was based on the stock price volatility of the Company since October 1st, 2014 (IPOdate) and the remaining years on the stock price volatility of similar companies. The Company’s management estimates the fair value of the options granted to consultants based on the value of services receivable over the vestingperiod of the applicable options. The value of the transactions, measured as aforesaid, is expensed over the period during which the right of the employees and non-employees to exercise orreceive the underlying equity instruments vests; commensurate with every periodic recognition of the expense, a corresponding increase is recorded toadditional paid in capital, included under the Company’s equity (see also note 10). Clinical trial accruals Clinical trial expenses are charged to research and development expense as incurred. The Company accrues for expenses resulting from obligations undercontracts with clinical research organizations (CROs). The financial terms of these contracts are subject to negotiations, which vary from contract tocontract and may result in payment flows that do not match the periods over which materials or services are provided. The Company’s objective is toreflect the appropriate trial expense in the financial statements by matching the appropriate expenses with the period in which services and efforts areexpended. As of December 31, 2017, the company had clinical accruals in the amount of approximately $1.5 million. NOTE 4—FINANCIAL RISK MANAGEMENT: a.Financial risk management: 1)Financial risk factors The Company’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk and price risk), credit and interest risks andliquidity risk. The Company’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potentialadverse effects on the Company’s financial performance. Risk management is performed by the Chief Financial Officer of the Company, who identifies and evaluates financial risks in close cooperation with theCompany’s Chief Executive Officer. The Company’s finance department is responsible for carrying out risk management activities in accordance with policies approved by its Board ofDirectors. The Board of Directors provides guidelines for overall risk management, as well as policies dealing with specific areas such as exchange raterisk, interest rate risk, credit risk, use of financial instruments, and investment of excess cash. In order to minimize exposure to market risk and credit risk,the Company invested the majority of its cash balances in highly-rated banks.  F-15 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 4—FINANCIAL RISK MANAGEMENT (continued): 2)Credit and interest risk Credit and interest risk arises from cash and cash equivalents and deposits with banks. A substantial portion of the liquid instruments of the Company areinvested in short-term deposits in a leading Israeli bank. The Company estimates that since the liquid instruments are mainly invested for the short-termand with a highly-rated institution, the credit and interest risk associated with these balances is immaterial. 3)Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate amount of committed creditfacilities. Management monitors rolling forecasts of the Company’s liquidity reserve (comprising cash and cash equivalents and deposits). This is generally carriedout based on the expected cash flows in accordance with practice and limits set by the management of the Company. The Company is in a research stage. It is therefore exposed to liquidity risk, taking into consideration the forecasts of cash flows required to finance itsinvestments and other activities. 4)Market risk—Foreign exchange risk The Company might be exposed to foreign exchange risk as a result of making payments to employees or service providers and investment of someliquidity in currencies other than the U.S. dollar (the functional currency of the Company). The Company manages the foreign exchange risk by aligningthe currencies for holding liquidity with the currencies of expected expenses, based on the expected cash flows of the Company. Had the dollar beenstronger by 5% against the New Israeli Shekel (“NIS”), assuming all other variables remained constant, the Company would have recognized an additionalexpense of $51 thousand, $13 thousand and $100 thousand in profit or loss for the years ended December 31, 2017, 2016 and 2015, respectively. b.Capital risk management The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to provide returns forshareholders and to maintain an optimal capital structure to reduce the cost of capital. It should be noted that the Company is in the research anddevelopment stage and does not yet generate regular revenue streams. (See also note 1a). c.Fair value of financial instruments The different levels of valuation of financial instruments are defined as follows: Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 Inputs, other than quoted prices included within level 1 that are observable for the asset or liability, either directly (as prices) or indirectly(derived from prices). Level 3 Inputs for the asset or liability that are not based on observable market data (unobservable inputs). The fair value of financial instruments traded in active markets is based on quoted market prices at the dates of the statements of financial position. F-16 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 4—FINANCIAL RISK MANAGEMENT (continued): A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, orregulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. These instruments are includedin level 1. The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniquesmaximize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs requiredto fair value an instrument are observable, the instrument is included in level 2. If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. As of December 31, 2017 and 2016, the fair value of financial instruments (cash and cash equivalents, short term bank deposits, other current assets, tradereceivables and accounts payable) are approximate to their carrying value. F-17 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 4—FINANCIAL RISK MANAGEMENT (continued): d.Composition of monetary balances The composition of financial instruments by currency: As of December 31, 2017: Dollars NIS Poundsterling Euro &SEK Total U.S. dollars in thousands Assets: Cash and cash equivalents $4,781 $1,546 $187 $180 $6,694 Short term bank deposits 48,035 — — — 48,035 Trade receivables 2,000 — — — 2,000 Other current assets (except for prepaid expenses) — 1,447 — — 1,447 54,816 2,993 187 180 58,176 Liabilities— Accounts payable and accrued expenses $4,492 $1,973 $45 $13 $6,523 Net assets $50,324 $1,020 $142 $167 $51,653 As of December 31, 2016: Dollars NIS Poundsterling Euro &SEK Total U.S. dollars in thousands Assets: Cash and cash equivalents $10,705 $768 $21 $91 $11,585 Short term bank deposits 33,669 — — — 33,669 Other current assets (except for prepaid expenses) — 912 — — 912 44,374 1,680 21 91 46,166 Liabilities— Accounts payable and accrued expenses $3,297 $1,428 $40 $23 $4,788 Net assets (liabilities) $41,077 $252 $(19) $68 $41,378 NOTE 5—SHORT-TERM BANK DEPOSITS: The bank deposits in 2017 of $48,035 thousand are for terms of three months to one year and carry interest at annual rates of 1.56%-1.81%. The bankdeposits in 2016 of $33,669 thousand are for terms of three months to one year and carry interest at annual rates of 0.97%-1.56%. F-18 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 6—PROPERTY AND EQUIPMENT Composition of assets, grouped by major classifications, and changes therein is as follows: Cost Accumulated depreciation Balance atbeginningof year Additionsduringthe year Disposalsduring theyear Balanceat endof year Balance atbeginningof year Additionsduringthe year Disposalsduring theyear Balanceat endof year Net bookvalue U.S. dollars in thousands Year endedDecember 31,2017: Laboratoryequipment $2,024 $1,186 $(194) $3,016 $1,605 $90 $(194) $1,501 $1,515 Computers 400 95 (257) 238 368 43 (257) 154 84 Officefurniture andequipment 67 83 (39) 111 57 2 (39) 20 91 Leaseholdimprovements 752 5,233 (310) 5,675 526 21 (310) 237 5,438 $3,243 $6,597 (800) $9,040 $2,556 $156 $(800) $1,912 $7,128 Cost Accumulated depreciation Balance atbeginningof year Additionsduringthe year Disposalsduring theyear Balanceat endof year Balance atbeginningof year Additionsduringthe year Balanceat endof year Net bookvalue U.S. dollars in thousands Year ended December 31,2016: Laboratory equipment $1,683 $341 — $2,024 $1,528 $77 $1,605 $419 Computers 374 26 — 400 336 32 368 32 Office furniture andequipment 66 1 — 67 54 3 57 10 Leasehold improvements 629 123 — 752 508 18 526 226 $2,752 $491 — $3,243 $2,426 $130 $2,556 $687 Year ended December 31,2015: Laboratory equipment $1,638 $45 — $1,683 $1,459 $69 $1,528 $155 Computers 347 27 — 374 306 30 336 38 Office furniture andequipment 65 1 — 66 50 4 54 12 Leasehold improvements 612 17 — 629 489 19 508 121 $2,662 $90 — $2,752 $2,304 $122 $2,426 $326 NOTE 7—SEVERANCE PAY OBLIGATIONS, net: a.The Company has both defined benefit and defined contribution plans. The Company has no obligation relating to the defined contribution plans. The obligation under the defined benefit plans is covered partly byregular deposits with severance pay funds and by the purchase of insurance policies. b.The Company’s obligation to make pension payments is covered by regular deposits with defined contribution plans. The amounts deposited arenot reflected in the statements of financial position. c.The amounts recognized in the statements of financial position were as follows: Year endedDecember 31 2017 2016 U.S. dollarsin thousands Severance pay obligations $469 $387 Fair value of plan assets 341 301 Liability in the statements of financial position $128 $86  F-19 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 7—SEVERANCE PAY OBLIGATIONS, net (continued): Amounts charged to other comprehensive loss (income) for the years ended December 31, 2017, 2016 and 2015 were $24 thousand, $5 thousand and $(6)thousand, respectively. The principal actuarial assumptions used for December 31, 2017 and 2016 were as follows: 2017 2016 Discount rate 2.8% 3.6%Future salary increases 4.5% 4.5% d.The amounts recorded as an employee benefit expense in respect of defined contribution plans for the years ended December 31, 2017, 2016and2015 were $318 thousand, $266 thousand and $254 thousand, respectively. NOTE 8—LICENSE AND SUPPLY AGREEMENT In November 2017, the Company signed an exclusive license agreement with NanoCarrier Co., Ltd. for the development, commercialization, and supply ofVB-111 in Japan. VBL retains rights to VB-111 in the rest of the world (“The License Agreement”). Under terms of the agreement, VBL has grantedNanoCarrier an exclusive license to develop and commercialize VB-111 in Japan for all indications. VBL will supply NanoCarrier with VB-111, andNanoCarrier will be responsible for all regulatory and other clinical activities necessary for commercialization in Japan. In exchange, the Company receivedan up-front nonrefundable payment of $15.0 million, and is entitled to receive greater than $100.0 million additional payments only if certain developmentor commercial milestones are achieved. VBL will also receive tiered royalties on net sales. In addition, in case NanoCarrier will enter into a sublicenseagreement, the Company will be entitled to receive royalties from sublicense income received by NanoCarrier. In December 2017, the Company met the first milestone relating to the commencement of the Ovarian Phase 3 trial; and therefore, it recognized $2.0 millionin trade receivables, which was received in January 2018. As of December 2017, and in accordance with IFRS 15, the Company concluded that it has satisfied the performance obligation for the grant of the licenseand use of its IP and recognized revenue in the amount of $11.9 million. In addition, upon the commencement of the Ovarian Phase 3 trial milestone, theCompany recognized additional variable revenue in the amount of $2.0 million. The performance obligation relating to the Company’s participation and consulting assistance services during the development period is recognized over theservice period. Out of the consideration received, the Company has deferred revenue in the amount of $3.1 million ($1.0 million is classified within currentliabilities, and $2.1 million within non-current liabilities, which will be recognized until 2020). All revenue recognized in 2017 was related to the license and use of the Company's IP. No revenues were recognized related to the Company's participationand consulting assistance services. For further details regarding the adoption of IFRS 15 - see note 2(m). NOTE 9—COMMITMENTS: a.In April 2011, the Company executed a Commercial License Agreement with Crucell Holland B.V. (“Crucell”), for incorporating the adenovirus 5in VB-111 and other drug candidates for cancer for consideration including the following potential future payments: ●an annual license fee of €100 thousand ($120 thousand), continuing until the termination of the agreement, which will occur upon (i) thelater of the expiration date of the last related patent or 10 years from the first commercial sale of VB-111 or (ii) the termination of theagreement by the Company, which is permitted, upon three months’ written advance notice to Crucell; ●a milestone payment of €400 thousand ($480 thousand) upon receipt of the first regulatory approval for the marketing of the first indicationfor each product covered under the agreement; and ●royalties of 0.5%-2.0% on net sales. There are no limits or caps on the amount of potential royalties. Pursuant to the agreement, the Company has the right to terminate the agreement bygiving Crucell three months’ written notice. b.In October 2012, the Company signed a lease agreement for the building it uses in consideration of $203 thousand per year. As of September 30,2015, the lease was extended for two years through September 30, 2017 and then for another 3 months through December 31st, 2017, and for onlythe manufacturing facility (380 sq. meters) an additional 6 months period through June 30th, 2018. The future minimum lease payments required inthe next year under the operating lease for such premises is approximately $48 thousand in 2018. F-20 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 9—COMMITMENTS (continued): In October 2016, the Company entered into a long-term lease contract for approximately $2.0 million over 7 years for a new facility in Modiin, Israel withthe option to extend for an additional two periods of three years each. The site houses the Company’s local biological drugs manufacturing facility,headquarters, discovery research and clinical development. The Company relocated to its new site in October 2017. The expected future minimum leasepayment $346 thousand on an annual basis for the years ending December 31, 2018 through December 31, 2023, and $144 thousand for the year endingDecember 31, 2024. The Company entered into operating lease agreements for vehicles it uses. The leases will expire in 2020. The expected lease payments for the yearsending December 31, 2018, 2019 and 2020 are approximately $170 thousand, $147 thousand and $65 thousand, respectively. c.In February 2013, the Company entered into an agreement with Tel Hashomer—Medical Research, Infrastructure and Services Ltd. (“TelHashomer”). The agreement with Tel Hashomer provides that the Company will pay 1% of any net sales of any product covered by the intellectualproperty covered under the agreement and 2% of any consideration received by the Company for granting a license or similar rights to suchintellectual property. Such amounts will be recorded as part of the Company’s cost of revenues. In addition, upon the occurrence of an exit eventsuch as a merger, sale of all shares or assets or the closing of an initial public offering such as the IPO, the Company is required to pay to TelHashomer 1% of the proceeds received by the Company or its shareholders as the case may be. Royalty and all other payment obligations underthis agreement will expire once the Company has paid an aggregate sum of NIS 100 million (approximately $29 million) to Tel Hashomer by wayof pay out, exit proceeds and licensing consideration. Amounts previously paid as royalties on any net sales will not be taken into account whencalculating this aggregate sum. Amounts payable upon occurrence of an exit event is not considered to be probable until actual occurrence. Uponoccurrence of such event, as such event does not represent a substantive milestone with regard to the Company’s intellectual property, the amountto be paid is recorded in the Statement of Comprehensive Loss under research and development costs. In November 2014, following the completion of an IPO, the Company paid to Tel Hashomer amount of $0.4 million. In November 2017, followingthe execution of The License Agreement, the Company paid Tel Hashomer an additional $340 thousand for a 2% consideration that was receivedfor granting a license or similar rights to this intellectual property. d.In January 2015, the Company entered into an agreement with a Contact Research Organization (“CRO”) according to which it will receive projectmanagement, clinical development and other related services from the CRO for the execution of the Phase 3 rGBM clinical trial study inconsideration for up to $18.7 million. Additional expenses related to changes in the study and in the estimated services involved were agreed uponand are being negotiated with the CRO during the execution of the study. Through December 31, 2017, expenses in the total amount of $17.5million were incurred. e.The Company is committed to pay royalties to the Government of Israel on proceeds from sales of products in the research and development ofwhich the Government participates by way of grants. At time the grants were received, successful development of the related project was notassumed. In the case of failure of the project that was partly financed by the Government of Israel, the Company is not obligated to pay any suchroyalties. Under the terms of the Company’s funding from the Israeli Government, royalties of 3%-3.5% are payable on sales of products developedfrom projects so funded up to 100% of the amount of the grant received by the Company (dollar linked) with the addition of an annual interestbased on Libor. Following the License Agreement the Company entered in 2017, it accrued a liability for the repayment of royalties in the amountof $510 thousand against research and development expenses. This liability is presented within accounts payable in the statement of financialposition. As of December 31, 2017, the total additional royalty amount that may be payable by the Company, before the additional Libor interest,is approximately $22.0 million ($26.9 million including interest). F-21 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 9—COMMITMENTS (continued): In addition, under the Research Law, we are prohibited from transferring, including by way of license, the IIA-financed technologies and relatedintellectual property rights and know-how outside of the State of Israel, except under limited circumstances and only with the approval of the IIAResearch Committee. We may not receive the required approvals for any proposed transfer and, even if received, we may be required to pay the IIAa portion of the consideration that we receive upon any sale of such technology to a non-Israeli entity up to 600% of the grant amounts plusinterest. f.In December 2017, the Company entered into an agreement with a Contact Research Organization (“CRO”) according to which it will receiveproject management, clinical development and other related services from the CRO for the execution of the Phase 3 study in platinum-resistantovarian cancer in consideration for approximately $19.0 million. Through December 31, 2017, expenses in the total amount of $400 thousandwere incurred. NOTE 10—SHARE CAPITAL: a.Composed of shares of NIS 0.01 par value, as follows: Number of shares December 31 2017 2016 Authorized: Ordinary Shares 70,000,000 70,000,000 Issued: Ordinary Shares (1) 29,879,323 26,902,285 (1)The Ordinary Shares confer upon their holders the following rights: (i) the right to vote in any general meeting of the Company; (ii) the right toreceive dividends; and (iii) the right to receive upon liquidation of the Company a sum equal to the nominal value of the share, and if a surplusremains, to receive such surplus. F-22 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 10—SHARE CAPITAL (continued): b.On November 3, 2015, the Company entered into an underwritten offering of 2,500,000 ordinary shares together with accompanying warrants topurchase an aggregate of 1,250,000 ordinary shares. The ordinary shares and warrants were sold in combination, with one warrant for each ordinaryshare sold, and represented the right to purchase 0.50 of an ordinary share. The combined offering price of each ordinary share and accompanyingwarrant was $6.00. The net proceeds from this offering, which closed on November 6, 2015 were $13.6 million after deducting the underwritingdiscounts and commissions and offering costs payable by the Company. The warrants are exercisable beginning on May 6, 2016 and will expire onMay 6, 2021 at an exercise price of $7.50 per one ordinary share. The ordinary shares and warrants were immediately separable and were issuedseparately. The fair value of the separable warrants on the date of grant was computed using the Black-Scholes model. The underlying data used forcomputing the fair value of the warrants are mainly as follows: ordinary share price based on the share’s price at the stock market on November 3,2015: $6.01; expected volatility based on comparable companies in the healthcare sector: 69.0%; risk-free interest rate: 1.59% (the risk-freeinterest rate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of thewarrants); expected dividend: zero; and expected life to exercise of 5.5 years. The consideration was allocated between ordinary shares andwarrants based on the ratio of the warrants’ fair value and the ordinary share price. c.On June 7, 2016, the Company entered into a securities purchase agreement related to a registered direct offering for an aggregate of 4,359,091ordinary shares, NIS 0.01 par value, at a purchase price of $5.50 per share. The net proceeds from this offering, which closed on June 10, 2016 wereapproximately $21.9 million after subtracting placement agent fees and offering costs. d.On December 1, 2016, the Company entered into a separate Equity Distribution Agreements with JMP Securities LLC and Chardan CapitalMarkets, LLC (collectively as the “Agents”) to implement an “at the market offering” program under which the Company, from time to time, mayoffer and sell its ordinary shares, NIS 0.01 par value, having an aggregate offering price of up to $20,000,000 (the “Shares”) through the Agents.The Company has provided the Agents with customary indemnification rights, and the Agents will be entitled to a fixed commission of 3.0% ofthe aggregate gross proceeds from the Shares sold. The “at the market offering” is effective through October 2018. For the year ended December 31,2017, the Company sold an aggregate of 224,695 ordinary shares under its at-the-market equity facility. The total consideration amounted to$1,322 thousand, net of issuance costs. e.On November 16, 2017, the Company entered into an underwriting agreement with Piper Jaffray & Co. related to the underwritten offering of anaggregate of 2,500,000 ordinary shares, NIS 0.01 par value (the “Ordinary Shares”). The public offering price for each Ordinary Share was $7.50.The purchase price to be paid by the underwriters to the Company for each Ordinary Share was $7.20. The net proceeds from the sale of theOrdinary Shares, which closed on November 21, 2017, was approximately $17.9 million after deducting underwriting discounts and commissionsand estimated offering expenses. f.Share based compensation plans In February 2000, the Company’s board of directors approved an option plan (the “Plan”) as amended through 2008. Under the Plan, the Company reservedup to 1,423,606 Ordinary Shares of NIS 0.01 par value of the Company for allocation to employees and non-employees. Each option is exercisable to acquireone Ordinary Share. In April 2011, the Company’s board of directors approved a new option plan (the “New Plan”). Under the New Plan, the Company reserved up to 766,958Ordinary Shares (of which 159,458 Ordinary Shares shall be taken from the unallocated pool reserved under the Plan) for allocation to employees and non-employees. F-23 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 10—SHARE CAPITAL (continued): In September 2014, the Company’s shareholders approved the adoption of the Employee Share Ownership and Option Plan (2014) (“2014 Plan”) effectiveas of the closing of the public offering. Under the 2014 Plan, the Company reserved up to 928,000 Ordinary Shares (of which 28,000 Ordinary Shares shallbe taken from the unallocated pool reserved under the New Plan). The Ordinary Shares to be issued upon exercise of the options confer the same rights asthe other Ordinary Shares of the Company, immediately upon allotment. Any option granted under the Plan that is not exercised within ten years from thedate upon which it becomes exercisable, will expire. Any option which was granted under the New Plan, and was not exercised within twenty years fromthe date when it becomes exercisable, will expire. Option exercise prices and vesting periods shall be as determined by the board of directors of the Company on the date of the grant.The options granted to employees through December 31, 2002 are subject to the terms stipulated by section 102 of the Israeli Income Tax Ordinance (the“Ordinance”). Among other things, the Ordinance provides that the Company will be allowed to claim as an expense for tax purposes the amounts creditedto the employees as a benefit upon sale of the shares allotted under the plans at a price exceeding the exercise price, when the related tax is payable by theemployee. The options granted to employees after December 31, 2002, are subject to the terms stipulated by section 102(b)(2) of the Ordinance. According to theseprovisions, the Company will not be allowed to claim as an expense for tax purposes the amounts credited to the employees as a capital gain benefit inrespect of the options granted. Options granted to related parties or non-employees of the Company are governed by Section 3(i) of the Ordinance. The Company will be allowed to claimas an expense for tax purposes the amounts equal to the expenses it recorded in the financial statements in the year in which the related parties or non-employees exercised the options into shares. In April 2016, the board of directors approved the increase of 620,824 Ordinary Shares to the number of shares available for issuance under the 2014 Plan,effective January 1, 2016. In March 2017, the Board of Directors approved the increase of 1,027,911 Ordinary Shares to the number of shares available for issuance under the 2014Plan. As of December 31, 2017, options to purchase 5,091 of Ordinary Shares were reserved for future grant under the 2014 Plan. F-24 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 10—SHARE CAPITAL (continued): Options granted in 2015: Number of options grantedaccording to option planof the Company Exerciseprice perOrdinary The fairvalue ofoptions on date Date of grant Other thandirectors Todirectors Total Share($) of grant (inthousands) 1) February 2015 — 60,000 60,000 $6.03 $722 2) November 2015 432,470 — 432,470 $7.52 $1,916 1)60,000 options were allocated to two external directors of the Company. a.The options will vest over 3 years from the date of grant; 1/12 of the options at the end of each quarter in the course of the 3 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $6.03, fair value of these options was estimated at $722 thousandwith expected volatility based on comparable companies in the healthcare sector: 69.0%; risk-free interest rate: 1.99% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. 2)432,470 options were allocated to employees and officers of the Company: a.The options will vest by 4 years with 50% on the second year anniversary; the remaining 50% at 1/8 of the options at the end of each quarterover the course of the last 2 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $7.52, fair value of these options was estimated at $1,916 thousandwith expected volatility based on comparable companies in the healthcare sector: 86.0%; risk-free interest rate: 2.28% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. Options and Restricted Stock Units (“RSUs”) granted in 2016: Number of options and RSUsgrantedaccording to option planof the Company Exerciseprice perOrdinary The fairvalue ofoptions and RSUs ondate Date of grant Other thandirectors Todirectors Total Share($) of grant (inthousands) 1) February 2016 — 20,000 20,000 $3.48 $51 2) May and June 2016 70,000 — 70,000 $3.30 - $3.40 $230 3) March 2016 114,129 — 114,129 $0.002 $412 4) November 2016 725,000 — 725,000 $5.08 $3,232 5) November 2016 100,000 — 100,000 $0.002 $492 1)20,000 options were allocated to two external directors of the Company: F-25 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 10—SHARE CAPITAL (continued): a.The options will vest over 3 years from the date of grant; 1/12 of the options at the end of each quarter in the course of the 3 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $3.48, fair value of these options was estimated at $51 thousandwith expected volatility based on comparable companies in the healthcare sector: 86.0%; risk-free interest rate: 1.64% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. 2)70,000 options were allocated to two Consultants: a.The options will vest between 3 to 5 years. b.Company management estimates the fair value of the options granted to consultants based on the value of services received over the vestingperiod of the applicable options. The value of such services is estimated based on the additional cash compensation the Company wouldneed to pay if such options were not granted. The fair value of these options on the date of grant was approximately $230 thousand. 3)114,129 restricted stock units (“RSUs”) were allocated to officers of the Company: a.The RSUs vesting period is dependent on the achievement of certain clinical performance milestones. b.The fair value of these RSUs on the date of grant was approximately $412 thousand, using the quoted closing market share price of $3.61onthe Nasdaq Global Market. 4)725,000 options were allocated to employees and officers of the Company: a.The options will vest by 4 years with 50% on the second year anniversary; the remaining 50% at 1/8 of the options at the end of each quarterover the course of the last 2 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $5.08, fair value of these options was estimated at $3,232 thousandwith expected volatility based on comparable companies in the healthcare sector: 97.0%; risk-free interest rate: 1.78% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. 5)100,000 RSUs were allocated to officers of the Company: a.The RSUs vesting period is dependent on the achievement of certain clinical performance milestones. b.The fair value of these RSUs on the date of grant was approximately $492 thousand, using the quoted closing market share price of $4.92 onthe Nasdaq Global Market. Options and Restricted Stock Units (“RSUs”) granted in 2017: Number of options grantedaccording to option planof the Company Exerciseprice perOrdinary The fairvalue ofoptions on date Date of grant Other thandirectors To directors Total Share($) of grant (inthousands) 1) February 2017 — 20,000 20,000 $5.22 $100 2) March 2017 10,000 — 10,000 $5.43 $30 3) March 2017 — 65,000 65,000 $5.71 $337 4) June 2017 100,000 — 100,000 $5.39 $437 5) June 2017 36,000 — 36,000 $0.002 $175 6) October 2017 700,000 — 700,000 $5.99 $4,113 7) October 2017 140,000 — 140,000 $0.002 $903 1)20,000 options were allocated to two independent directors of the Company: a.The options will vest over 3 years from the date of grant; 1/12 of the options at the end of each quarter in the course of the 3 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $5.22, fair value of these options was estimated at $100 thousandwith expected volatility based on comparable companies in the healthcare sector: 97.0%; risk-free interest rate: 2.41% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. F-26 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) 2)10,000 options was allocated to a Consultant: a.The options will vest over 3 years. b.Company management estimates the fair value of the options granted to consultants based on the value of services received over the vestingperiod of the applicable options. The value of such services is estimated based on the additional cash compensation the Company wouldneed to pay if such options were not granted. The fair value of these options on the date of grant was approximately $30 thousand. 3)65,000 options were allocated to four independent directors of the Company: a.The options will vest by 4 years with 50% on the second year anniversary; the remaining 50% at 1/8 of the options at the end of each quarterover the course of the last 2 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $5.71, fair value of these options was estimated at $337 thousandwith expected volatility based on comparable companies in the healthcare sector: 97.0%; risk-free interest rate: 2.44% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. 4)100,000 options was allocated to an officer of the Company: a.The options will vest by 4 years with 25% on the first year anniversary; the remaining 75% at 1/12 of the options at the end of each quarterover the course of the last 3 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $5.39, fair value of these options was estimated at $437 thousandwith expected volatility based on comparable companies in the healthcare sector: 97.0%; risk-free interest rate: 2.15% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. 5)36,000 restricted stock units (“RSUs”) were allocated to an officer of the Company: a.The RSUs vesting period is dependent on the achievement of certain clinical performance milestones. b.The fair value of these RSUs on the date of grant was approximately $175 thousand, using the quoted closing market share price of $4.85 onthe Nasdaq Global Market. 6)700,000 options were allocated to employees and officers of the Company: a.The options will vest by 4 years with 25% on the first year anniversary; the remaining 75% at 1/12 of the options at the end of each quarterover the course of the last 3 years. b.The fair value of the options on the date of grant was computed using the Black-Scholes model. The underlying data used for computing thefair value of the options are mainly as follows: an exercise price equal to $5.99, fair value of these options was estimated at $4,113 thousandwith expected volatility based on comparable companies in the healthcare sector: 97.0%; risk-free interest rate: 2.41% (the risk-free interestrate is determined based on rates of return on maturity of unlinked treasury bonds with time to maturity that equals the average life of theoptions); expected dividend: zero; and the expected term; 11 years. 7)140,000 RSUs were allocated to officers of the Company: a.The RSUs vesting period is dependent on the achievement of certain clinical performance milestones. b.The fair value of these RSUs on the date of grant was approximately $903 thousand, using the quoted closing market share price of $6.45 onthe Nasdaq Global Market. F-27 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 10—SHARE CAPITAL (continued): g.Changes in the number of options, warrants and RSUs and weighted average exercise prices are as follows: Year ended December 31 2017 2016 2015 Number ofoptions Weightedaverageexerciseprice Number ofoptions Weightedaverageexerciseprice Number ofoptions Weightedaverageexerciseprice Outstanding at beginning of year 3,241,535 $3.41 2,304,179 $3.17 1,885,123 $2.01 Granted 1,071,000 4.91 1,029,129 3.87 492,470 7.34 Exercised (252,343) 1.91 (72,873) 1.66 (71,647) 1.32 Forfeited (24,097) 4.18 (18,900) 6.92 (1,767) 3.32 Outstanding at end of year 4,036,095 $3.88 3,241,535 $3.41 2,304,179 $3.17 Exercisable at end of year 1,844,283 $2.97 1,718,713 $2.16 1,688,773 $2.05 h.The following is information about exercise price and remaining contractual life of outstanding options, warrants and RSUs at year-end: December 31, 2017 December 31, 2016 December 31, 2015 Number ofoptionsoutstandingat end ofyear Exerciseprice Weightedaverage ofremainingcontractuallife Number ofoptionsoutstandingat end ofyear ExercisePrice Weightedaverage ofremainingcontractuallife Number ofoptionsoutstandingat end ofyear Exerciseprice Weightedaverage ofremainingcontractuallife 758,928 $0.002 8.29 620,970 $0.002 10.73 406,841 $0.002 17.39 98,657 $1.21 6.78 117,990 $1.21 7.65 171,990 $1.21 8.84 513,969 $2.47 10.45 713,282 $2.47 1.12 721,632 $2.47 2.30 584,871 $3.30 - $3.48 14.96 588,023 $3.30 - $3.48 15.96 511,246 $3.32 17.75 60,000 $6.03 17.13 60,000 $6.03 18.13 60,000 $6.03 19.13 409,670 $7.52 17.88 416,270 $7.52 18.88 432,470 $7.52 19.89 1,610,000 $5.08 - $5.99 19.38 725,000 $5.08 19.87 4,036,095 3,241,535 2,304,179 i.Expenses for share based compensation recognized in statements of comprehensive loss were as follows: Year endedDecember 31 2017 2016 2015 U.S. dollarsin thousands Research and development expenses $2,027 $900 $385 Administrative and general expenses 1,977 520 656 Marketing expenses 148 — — $4,152 $1,420 $1,041 The remaining unrecognized compensation expenses as of December 31, 2017 are $6,444 thousand; this amount will be expensed in full by December 2021. F-28 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 11—TAXES ON INCOME The Company is taxed according to Israeli tax laws: a.Measurement of results for tax purposes The Company as a “foreign-investment company” measures its results for tax purposes in dollar based on Income Tax Regulations (Bookkeeping Principlesof Foreign Invested Companies and of Certain Partnerships and the Determination of Their Taxable Income), 1986. b.Tax rates The income of the Company, other than income from Benefitted Enterprises (see c below), is subject to the regular corporate tax rate. The corporate tax ratefor 2017, 2016 and 2015 were 24%, 25% and 26.5%, respectively. In January 2016, the Law for the Amendment of the Income Tax Ordinance (No. 216) waspublished, enacting a reduction of corporate tax rate beginning in 2016 and thereafter, from 26.5% to 25%. In December 2016, the Economic Efficiency Law (Legislative Amendments for Implementing the Economic Policy for the 2017 and 2018 Budget Year) waspublished, introducing a gradual reduction in corporate tax rate from 25% to 23%. As a result, the corporate tax rate in 2017 is 24% and in 2018 andthereafter reduced to 23%. c.Tax benefits under the Law for the Encouragement of Capital Investments, 1959 (the “Investment Law”) Under the Investment Law, including Amendment No. 60 to the Investment Law that was published in April 2005, by virtue of the Benefited Enterpriseprogram for certain of its production facilities, the Company may be entitled to various tax benefits. The main benefit arising from such status is the reduction in tax rates on income derived from a Benefited Enterprise. The extent of such benefits depends onthe location of the enterprise. Since the Company’s facilities are not located in “national development zone A,” income derived from Benefited Enterpriseswill be tax exempt for a period of two years and then have a reduced tax rate for a period of up to an additional eight years. The period of tax benefits, as described above, is limited to 12 years from the beginning of the Benefited Enterprise election year (2012). As of December 31,2017, the period of benefits has not yet commenced. In the event of distribution or deemed distribution of dividends from income which was tax exempt as above, the amount distributed will be subject to the taxrate it was exempted from. The Company is entitled to claim accelerated depreciation in respect of equipment used by the approved enterprises during five tax years. Entitlement to the above benefits is conditioned upon the Company fulfilling the conditions stipulated by the Investment Law and regulations publishedthereunder. In the event of failure to comply with these conditions, the benefits may be canceled and the Company may be required to apply the regular tax depreciationrates and pay tax on the income in question at the regular corporate tax rates with the addition of linkage differences to the Israeli consumer price index andinterest. F-29 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 11—TAXES ON INCOME (continued): The Investment Law was amended as part of the Economic Policy Law for the years 2011—2012 (the “Amendment”), which became effective on January1, 2011. The Amendment sets alternative benefit tracks to the ones currently in place under the provisions of the Investment Law, including a reduced corporate taxrate. Tax rate for “Preferred Enterprise” income of companies not located in national development zone A is 16% for fiscal year 2014 and thereafter. The benefits are granted to companies that qualify under criteria set forth in the Investment Law; for the most part, those criteria are similar to the criteriathat have existed in the Investment Law prior to its amendment and the benefit period is unlimited in time. However, in accordance with the Amendment,the classification of licensing income as Preferred income may be subject to the issuance of a pre-ruling by the Israel Tax Authority. Under the transitional provisions of the Investment Law, a company is allowed to continue to enjoy the tax benefits available under the Investment Lawprior to its amendment until the end of the period of benefits, as defined in the Investment Law. In each year during the period of benefits of its Benefited Enterprise, the Company will be able to opt for application of the Amendment, thereby makingavailable to itself the tax rate described above. The Company’s election to apply the Amendment is irrevocable. As of December 31, 2017, the Company’s management decided not to adopt the application of the Amendment. There is no assurance that future taxable income of the Company will qualify as Benefited or Preferred income or that the benefits described above will beavailable to the Company in the future. d.Losses for tax purposes carried forward to future years The balance of carry forward losses as of December 31, 2017 and 2016 are $144.9 million and $137.1 million, respectively. Under Israeli tax laws, carryforward tax losses have no expiration date. Deferred tax assets on losses for tax purposes carried forward to subsequent years are recognized if utilization of the related tax benefit against a futuretaxable income is expected. The Company has not created deferred taxes on its carry forward losses since their utilization is not expected in the foreseeable future. e.Tax assessments The Company has tax assessments that are considered to be final through tax year 2012. F-30 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 12—SUPPLEMENTARY FINANCIAL INFORMATION: December 31 2017 2016 U.S. dollarsin thousands a. Other current assets: Institutions - VAT $865 $144 Prepaid expenses 282 408 Government grants receivable 482 768 Other 100 — $1,729 $1,320 b. Accounts payable—other: Accrued expenses $2,956 $1,923 Employee—related accrued expenses 317 217 Provision for vacation 192 126 $3,465 $2,266 Year ended December 31 2017 2016 2015 U.S. dollarsin thousands c. Research and development expenses, net: Payroll and related expenses $4,636 $2,921 $2,807 Subcontractors and consultation 12,450 8,894 7,227 Materials 768 556 762 Patent expenses 797 752 1,324 Depreciation 106 88 88 Office rent and maintenance 721 397 404 Other 481 539 437 19,959 14,147 13,049 Government grants (see note 9e) (2,189) (1,700) (1,851) $17,770 $12,447 $11,198 d. Administrative and general expenses: Payroll and related expenses $2,681 $1,499 $843 Management and professional fees 2,212 1,614 2,018 Foreign travel 279 259 236 Depreciation 50 42 34 Other 625 414 542 $5,847 $3,828 $3,673 e. Marketing expenses Payroll and related expenses $346 — — Consultation 216 — — $562 — — F-31 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 13—LOSS PER SHARE Basic and diluted loss per share: Basic Basic loss per share is calculated by dividing the result attributable to equity holders of the Company by the weighted average number of Ordinary Shares inissue during the year. Diluted All Ordinary Shares underlying outstanding options, RSU’s and warrants have been excluded from the calculation of the diluted loss per share for the yearsended December 31, 2017, 2016 and 2015 since their effect was anti-dilutive. The total number of options, RSU’s and warrants excluded from thecalculations of diluted loss per share were – 5,286,095, 4,491,535, and 3,554,179 for the years ended December 31, 2017, 2016 and 2015, respectively. Year ended December 31 2017 2016 2015 U.S. dollars in thousands, except per share data Basic and diluted: Loss attributable to equity holders of the Company $10,138 $16,002 $14,888 Weighted average number of ordinary shares in issue 27,398,169 24,970,585 20,309,596 Loss per ordinary share $0.37 $0.64 $0.73 NOTE 14—FINANCIAL (INCOME) EXPENSES, net: Year ended December 31 2017 2016 2015 U.S. dollarsin thousands Financial income: Interest from deposits $335 $263 $100 Exchange differences 209 22 — 544 285 100 Financial expenses: Bank fees 27 12 16 Exchange differences — — 101 27 12 117 TOTAL FINANCIAL (INCOME) EXPENSES, net $(517) $(273) $17 F-32 Table of Contents VASCULAR BIOGENICS LTD.NOTES TO THE FINANCIAL STATEMENTS (continued) NOTE 15—RELATED PARTIES—TRANSACTIONS AND BALANCES: a.Transactions with related parties Key management personnel include members of the Board of Directors, the Chief Executive Officer and all Vice Presidents of the Company and companiescontrolled by them. Year ended December 31 2017 2016 2015 U.S. dollars in thousands Key management compensation: Labor cost and related expenses $2,202 $1,737 $1,791 Share-based payments 2,075 817 798 Other 406 420 446 $4,683 $2,974 $3,035 b.Balances with related parties: December 31 2017 2016 U.S. dollars inthousands Key management— Payables and accrued expenses - for salary and related expenses $409 $319 Severance pay obligations $88 $69 Provision for vacation $97 $65 NOTE 16—SUBSEQUENT EVENT: On March 8, 2018, the Company reported top-line results from its pivotal Phase 3 GLOBE study in patients with recurrent glioblastoma (rGBM). The studydid not meet its pre-specified primary endpoint of overall survival. The Company expects to receive the full and final data and to conduct an in-depthanalysis in order to better understand the outcome of the study and the potential activity of VB-111 in recurrent GBM. F-33 Table of Contents Item 19. Exhibits Exhibit No. Description 1.1 Articles of Association of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.2 of the Registration Statement on FormF-1 filed with the Securities and Exchange Commission on September 30, 2014). 1.2 Memorandum of Association of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.4 of the Registration Statement onForm F-1 filed with the Securities and Exchange Commission on September 30, 2014). 2.1 Amended and Restated Investors’ Rights Agreement, dated as of March 13, 2008, by and among the Registrant and the other parties thereto, asamended. (incorporated by reference to Exhibit 4.1 of the Registration Statement on Form F-1 filed with the Securities and ExchangeCommission on June 6, 2014). 2.2 Form of Certificate for Ordinary Shares (incorporated by reference to Exhibit 4.2 of Registration Statement on Form F-1 filed with theSecurities and Exchange Commission on July 29, 2014). 2.3 Warrant to purchase ordinary shares, dated May 8, 2014, issued to S.R. Horn Assets Ltd. (incorporated by reference to Exhibit 4.3 of theRegistration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 2.4 Warrant to purchase ordinary shares, dated April 1, 2001, issued to Dror Harats, as amended (incorporated by reference to Exhibit 4.4 of theRegistration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 2.5 Warrant to purchase ordinary shares, dated May 14, 2001, issued to Dror Harats, as amended (incorporated by reference to Exhibit 4.5 of theRegistration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 2.6 Warrant to purchase ordinary shares, dated December 28, 2001, issued to Dror Harats, as amended (incorporated by reference to Exhibit 4.6 ofthe Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 4.1 Employee Ownership and Share Option Plan (2011) of the Registrant, and form of agreement thereunder (incorporated by reference to Exhibit10.1 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 4.2 Form of Release and Indemnification Agreement to be entered into between the Registrant and its officers and directors (incorporated byreference to Exhibit 10.3 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 25, 2014). 4.3† Commercial Gene Therapy License Agreement, dated April 15, 2011, between the Registrant and Crucell Holland B.V. (incorporated byreference to Exhibit 10.3 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on July 18, 2014). 4.4† Agreement, dated February 3, 2013, between the Registrant and Tel Hashomer—Medical Research, Infrastructure and Services Ltd.(incorporated by reference to Exhibit 10.4 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission onJuly 18, 2014). 4.5† Manufacturing Services Agreement, dated January 5, 2012, between the Registrant and Lonza Houston, Inc. (incorporated by reference toExhibit 10.5 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on July 18, 2014). 4.6 Master Services Agreement, dated May 14, 2008, between the Registrant and Genzyme Pharmaceuticals (incorporated by reference to Exhibit10.3 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 115 Table of Contents Exhibit No. Description 4.7† Technical Agreement on the Manufacture of Capsules, dated April 29, 2008, between the Registrant and Encap Drug Delivery and standardterms and conditions of purchase order (incorporated by reference to Exhibit 10.7 of the Registration Statement on Form F-1 filed with theSecurities and Exchange Commission on July 18, 2014). 4.8† Technical Agreement on the Manufacture of Capsules, dated August 3, 2012, between the Registrant and Encap Drug Delivery and standardterms and conditions of purchase order (incorporated by reference to Exhibit 10.8 of the Registration Statement on Form F-1 filed with theSecurities and Exchange Commission on July 18, 2014). 4.9† Material Transfer and Confidentiality Agreement, effective as of September 19, 2005, among the Registrant, Crucell Holland B.V. andBioReliance Ltd. (incorporated by reference to Exhibit 10.9 of the Registration Statement on Form F-1 filed with the Securities and ExchangeCommission on July 18, 2014). 4.10† General Services Agreement, dated September 24, 2012, between the Registrant and BioClinica, Inc., and Addendum dated November 19,2012 and August 29, 2013 (incorporated by reference to Exhibit 10.10 of the Registration Statement on Form F-1 filed with the Securities andExchange Commission on July 18, 2014). 4.11† Clinical Trial Agreement, dated September 9, 2012, between the Registrant and SCIderm GmbH (incorporated by reference to Exhibit 10.11 ofthe Registration Statement on Form F-1 filed with the Securities and Exchange Commission on July 18, 2014). 4.12† Service Agreement, dated November 8, 2012, between the Registrant and KCR S.A. (incorporated by reference to Exhibit 10.12 of theRegistration Statement on Form F-1 filed with the Securities and Exchange Commission on July 18, 2014). 4.13† Service Agreement, dated December 16, 2013, between the Registrant and KCR S.A. (incorporated by reference to Exhibit 10.13 of theRegistration Statement on Form F-1 filed with the Securities and Exchange Commission on July 18, 2014). 4.14# Lease Agreement, dated January 2013, between the Registrant and Matzlawi Building Company Ltd. (incorporated by reference to Exhibit10.14 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 4.15† Material Transfer and Confidentiality Agreement, effective February 6, 2012 between the Registrant, Crucell Holland B.V. and LonzaHouston, Inc. (incorporated by reference to Exhibit 10.15 of the Registration Statement on Form F-1 filed with the Securities and ExchangeCommission on July 18, 2014). 4.16 Agreement between the Registrant and Prof. Jacob George, dated January 24, 2010, as amended on August 1, 2012 (incorporated by referenceto Exhibit 10.16 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 6, 2014). 4.17 Employee Share Ownership and Option Plan (2014) of the Registrant, and form of Capital Gains Option Agreement thereunder (incorporatedby reference to Exhibit 10.17 of the Registration Statement on Form F-1 filed with the Securities and Exchange Commission on June 25,2014). 4.18† Master Services Agreement, effective as of January 30, 2015, by and between PPD Development, L.P. and the Registrant. 4.19*# 4.20*†† Lease Agreement, dated as of June 10, 2016, by and between the Registrant and Darwish Shalom. Development, Commercialization and Supply Agreement, dated as of November 3, 2017, by and between the Registrant and NanoCarrier Co.,Ltd. 4.21*†† Clinical Trial Services Agreement by and between the Registrant and the GOG Foundation, Inc. dated December 23, 2017. 4.22*†† Agreement by and between the Registrant and Biopharmax Group Ltd. dated June 1, 2016. 12.1* Certification of Chief Executive Officer Pursuant to Rule 13a-14(a)/15d-14(a). 12.2* Certification of Chief Financial Officer Pursuant to Rule 13a-14(a)/15d-14(a). 13.1** Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 ofthe Sarbanes-Oxley Act of 2002. 15.1* Consent of Kesselman & Kesselman, a member firm of PricewaterhouseCoopers International Limited, Independent Registered PublicAccounting Firm. 116 Table of Contents † ††Portions of this exhibit have been omitted pursuant to a grant of confidential treatment by the Securities and Exchange Commission and the non-public information has been filed separately with the Securities and Exchange Commission.Portions of this exhibit have been omitted pursuant to a request for confidential treatment by the Securities and Exchange Commission and the non-public information has been filed separately with the Securities and Exchange Commission. #English summary of original Hebrew document.*Filed herewith**The certifications furnished in Exhibit 13.1 hereto are deemed to accompany this Annual Report on Form 20-F and will not be deemed “filed” forpurposes of Section 18 of the Securities Exchange Act of 1934, as amended. Such certifications will not be deemed to be incorporated by reference intoany filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Registrantspecifically incorporates it by reference. 117 Table of Contents SIGNATURES The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to signthis annual report on its behalf. VASCULAR BIOGENICS LTD. By:/s/ Dror Harats Dror HaratsChief Executive Officer Date: March 15, 2018 118   CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. DEVELOPMENT, COMMERCIALIZATION AND SUPPLY AGREEMENT DATED AS OF NOVEMBER 3, 2017 BY AND BETWEEN VASCULAR BIOGENICS LTD. AND NANOCARRIER CO., LTD. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 1 DEFINITIONS1 ARTICLE 2 LICENSES13 2.1 Grant to Licensee132.2 Grant to VBL142.3 Additional Licensing Provisions142.4 Restrictive Covenants14 ARTICLE 3 GOVERNANCE15 3.1 Governance Committees153.2 Committees183.3 Limits on Committee Authority183.4 Actions183.5 Exchange of Information183.6 Minutes of Committee Meetings193.7 Expenses19 ARTICLE 4 DEVELOPMENT19 4.1 Overview194.2 Objectives Under the Development Plan204.3 Development Plan and Development Budget214.4 Development Costs224.5 Records, Reports and Information234.6 Ownership and Transfer of Development Data234.7 Right to Audit24 ARTICLE 5 REGULATORY24 5.1 Regulatory Data and Regulatory Materials245.2 Regulatory Filings and Regulatory Approvals255.3 Communications265.4 No Other Regulatory Filings275.5 Rights of Reference275.6 Adverse Event Reporting, Safety Data Exchange and Medical Inquiries275.7 Regulatory Authority Communications Received by a Party285.8 Recall, Withdrawal, or Market Notification of Product29 ARTICLE 6 COMMERCIALIZATION30 6.1 Commercialization in the Field in the Territory306.2 Commercialization Plan316.3 Licensee’s Performance326.4 Reports336.5 Compliance336.6 Compliance Audit356.7 Provisions applicable to Sales Representatives and/or Medical Science Liaisons366.8 Promotional Materials376.9 Product Trademarks and Product Trade Dress386.10 Global Branding Strategy396.11 Commercialization Data40 CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 7 SUPPLY40 7.1 VBL Supply Obligations407.2 Exclusivity417.3 Packaging and Labeling; Certain Other Manufacturing Activities417.4 Forecasting and Ordering427.5 Supply Price and Invoicing437.6 Shipping and Delivery447.7 Quality and Compliance457.8 Disputes and Remedies467.9 Shortages477.10 Major Supply Failure477.11 Product Specification and Manufacturing Changes487.12 Termination of Supply Obligations48 ARTICLE 8 PAYMENTS49 8.1 Upfront Payment498.2 Milestone Payments498.3 Royalty Payments; Sublicense Income518.4 Royalty Stacking528.5 Royalty Reports and Payment Procedures528.6 Taxes and Withholding528.7 Withholding Tax538.8 Currency Conversion538.9 General Payment Procedures538.10 Late Payments538.11 Financial Records and Audit54 ARTICLE 9 INTELLECTUAL PROPERTY MATTERS55 9.1 Ownership of Intellectual Property559.2 Patent Filings, Prosecution and Maintenance559.3 Defense and Enforcement of Patents579.4 Patent Term Extensions599.5 Patent Marking599.6 Patent Challenge59 ARTICLE 10 REPRESENTATIONS, WARRANTIES AND COVENANTS59 10.1 Mutual Representations and Warranties5910.2 Additional Representations, Warranties and Covenants of VBL6010.3 Additional Representations, Warranties and Covenants of Licensee6110.4 Disclaimer6210.5 No Other Representations or Warranties62 CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 11 INDEMNIFICATION62 11.1 Indemnification by VBL6211.2 Indemnification by Licensee6311.3 Indemnification Procedures6311.4 Limitation of Liability6311.5 Insurance63 ARTICLE 12 CONFIDENTIALITY64 12.1 Confidential Information6412.2 Confidentiality Obligations6512.3 Permitted Disclosure and Use6512.4 Notification6512.5 Publicity; Filing of this Agreement6612.6 Publication6712.7 Use of Names6712.8 Survival67 ARTICLE 13 TERM AND TERMINATION67 13.1 Term6713.2 Termination for Breach6813.3 Termination as a Result of Bankruptcy6813.4 Termination by Licensee for Convenience68 ARTICLE 14 EFFECTS OF TERMINATION AND EXPIRATION68 14.1 Termination6814.2 Expiration of this Agreement7214.3 Accrued Rights7214.4 Survival7214.5 Rights in Bankruptcy72 ARTICLE 15 DISPUTE RESOLUTION73 15.1 Disputes7315.2 Arising Between the Parties7315.3 Dispute Resolutions7315.4 Patent and Trademark Dispute Resolution7415.5 Injunctive Relief74 ARTICLE 16 MISCELLANEOUS75 16.1 Entire Agreement; Amendment7516.2 Force Majeure7516.3 Notices7516.4 No Strict Construction; Interpretation7616.5 Assignment7616.6 Severability7616.7 No Waiver of Breach7616.8 Partnership or Joint Venture7716.9 English Language; Governing Law7716.10 Execution in Counterparts77 Schedules: Schedule 1.78VBL PatentsSchedule 4.3.2Initial Development PlanSchedule 12.5.1Press Release CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. DEVELOPMENT, COMMERCIALIZATION AND SUPPLY AGREEMENT This Development, Commercialization and Supply Agreement (this “Agreement”) is entered into as of the 3rd day of November, 2017 (the “Effective Date”)by and among Vascular Biogenics Ltd., a company incorporated under the laws of Israel, doing business as VBL Therapeutics, with offices at 6 JonathanNetanyahu Street, OrYehuda, 60376, Israel (“VBL”), and NanoCarrier Co., Ltd., a company incorporated under the laws of Japan, with offices at 144-15Chuo, 226-39 Wakashiba, Kashiwa, Chiba, 277-0871, Japan (“Licensee”). VBL and Licensee are sometimes referred to herein individually as a “Party” andcollectively as the “Parties.” RECITALS Whereas, VBL owns certain intellectual property and regulatory rights relating to a drug known as VBL-111 (ofranergene obadenovec) (the“Product” as defined in more detail below); Whereas, Licensee has experience in the development and commercialization of pharmaceutical products in the Territory; and Whereas, Licensee and VBL desire to establish a collaboration for the further development and commercialization of the Product in the Field in theTerritory. Now Therefore, in consideration of the foregoing premises and the mutual promises, covenants and conditions contained in this Agreement, theParties agree as follows: ARTICLE 1DEFINITIONS As used in this Agreement, the following initially capitalized terms shall have the meanings set forth in this ARTICLE 1 or as otherwise definedelsewhere in this Agreement: 1.1 “Accounting Standards” means (a) with respect to VBL, the International Financial Reporting Standards (IFRS) and (b) with respect toLicensee, Japanese Generally Accepted Accounting Principles (JGAAP), in each case as consistently applied. 1.2 “Affiliate” means, as of the Effective Date or during the Term, as applicable, in relation to a Party, any person, corporation, firm or partnershipor other entity, whether de jure or de facto, that directly or indirectly through one or more intermediaries controls, is controlled by or is under commoncontrol with such Party. An entity shall be deemed to control another entity if it: (a) owns, directly or indirectly, more than fifty percent (50%) of theoutstanding voting securities or share capital (or such lesser percentage which is the maximum allowed to be owned by a foreign corporation in a particularjurisdiction) of such other entity, or has other comparable ownership interest with respect to any entity other than a corporation, or (b) has the power, whetherpursuant to contract, ownership of securities or otherwise, to direct the management and policies of the entity. For the avoidance of doubt, neither of theParties, or any of their respective Affiliates, shall be deemed to be an “Affiliate” of such other entity. 1.3 “Anti-Corruption Laws” means the U.S. Foreign Corrupt Practices Act, as amended, and any similar anti-corruption-related Applicable Lawsadopted in Japan or Israel, as well as Applicable Laws related to the prevention of fraud, racketeering, money laundering or terrorism. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.4 “Applicable Laws” means any and all statutes, ordinances, regulations, rules, treaties or guidance of any kind whatsoever and any and allrequirements under permits, orders, decrees, judgments or directives and requirements of applicable Governmental Authorities, in each case pertaining to anyof the activities contemplated by this Agreement, including GMP, GCP, GLP, GXP and any other regulations and guidelines promulgated by any RegulatoryAuthority in the Territory, all as amended from time to time. 1.5 “Approval Application” means an application to the applicable Regulatory Authority, seeking registration of the Product for sale in theTerritory. 1.6 “Business Day” means a day other than a Saturday, Sunday, or a day on which banking institutions in Tel Aviv, Israel or Tokyo, Japan areclosed. 1.7 “Calendar Quarter” means each successive period of three (3) calendar months commencing on January 1, April 1, July 1 and October 1;provided, that (a) the first Calendar Quarter hereunder shall be deemed to commence upon the Effective Date and (b) the final Calendar Quarter hereundershall be deemed to expire upon the effective date of expiration or termination of this Agreement. 1.8 “Calendar Year” means (a) for the first calendar year, the period commencing on the Effective Date and ending on December 31, 2017, (b) foreach successive period, beginning on January 1 and ending twelve (12) consecutive calendar months later on December 31, and (c) for the calendar year inwhich this Agreement is terminated, the period beginning on January 1 of such calendar year and ending on the effective date of the termination of thisAgreement. 1.9 “Commercialize”, “Commercializing” or “Commercialization” means all activities directed to the marketing, promotion, selling or offeringfor sale of a Product for an indication, including planning, market research, Pre-Marketing, advertising, educating, marketing, promoting, using importing,exporting, distributing and post-marketing safety surveillance and reporting. For clarity, “Commercialization” shall not include any activities related toclinical research, Manufacturing or Development of the Product. 1.10 “Commercialization Activities” means those Commercialization activities undertaken by or on behalf of a Party or its Affiliates with respectto the Product in the Field. 1.11 “Commercially Reasonable Efforts” means, with respect to a Party’s obligation to perform or achieve a specified obligation for the Productor generally under this Agreement, the efforts, expertise, degree of skill, and resources that are comparable in quality and scope to those efforts, expertise,degree of skill and resources that are generally used by such Party to perform or achieve a comparable obligation for a comparable pharmaceutical productControlled by such Party, but in any event, a Party’s effort shall be no less than the effort that a comparable pharmaceutical company would expend withrespect to a comparable pharmaceutical product Controlled by such company. Without limiting the foregoing, Commercially Reasonable Efforts requires,with respect to such obligations, that the Party: (i) promptly assign responsibility for such obligation to specific employee(s) who are held accountable forprogress and monitor such progress on an on-going basis, (ii) set objectives for carrying out such obligations, and (iii) allocate resources designed to advanceprogress with respect to such objectives. 2CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.12 “Committee” means the Joint Management Committee, the Joint Clinical Committee, the Joint Commercialization and Sales Committee andsuch other committees as may be established pursuant to Section 3.2 hereof. 1.13 “Control” means, with respect to any Know-How, physical material, patent right, or other intellectual property right, possession by a Party orits Affiliates (whether by ownership, license grant or other means) of the legal right to grant the right to access or use, or to grant a license or a sublicense to,such Know-How, physical material, patent right, or other intellectual property right as provided for herein without violating the proprietary rights of anyThird Party or any terms of any agreement or other arrangement between such Party (or any of its Affiliates) and any Third Party. 1.14 “Cover(ed)” means, with respect to any Patent and the subject matter at issue, that, but for a license granted under a Valid Claim of suchPatent, the manufacture, development, use, sale, offer for sale or importation of the subject matter at issue would infringe such Valid Claim, or in the case of aPatent that is a patent application, would infringe a Valid Claim in such patent application if it were to issue as a patent. 1.15 “CTA” means an application to the applicable Regulatory Authority, such as a clinical trial application or a clinical trial exemption, thefiling of which is necessary to commence or conduct clinical testing of a pharmaceutical product in humans in such jurisdiction. 1.16 “Develop”, “Developing” or “Development” means all activities relating to both non-GLP and GLP preclinical studies and clinical trials,and such additional testing, analysis and reporting, as necessary or otherwise requested or required by a Regulatory Authority as a condition or in support ofobtaining or maintaining all Regulatory Approvals, including Phase IV Clinical Trials and other post-Regulatory Approval studies that are required to obtainor maintain Regulatory Approval. For clarity, “Development” shall exclude any activities related to Commercialization or Manufacture. 1.17 “Development Activities” means those Development activities undertaken by or on behalf of a Party or its Affiliates with respect to theProduct in the Field. 1.18 “Development Costs” means the costs and expenses incurred by a Party or its Affiliates attributable to, or reasonably allocable to, theDevelopment of the Product in the Field, including costs of conducting clinical trials and Phase IV Clinical Trials (as well as other post-Regulatory Approvalstudies (including physician-initiated studies)). “Development Costs” shall include (i) Out-of-Pocket Costs and (ii) internal costs (e.g., staff or administrative)that are attributable to, or reasonably allocable to, the Development of the Product in the Field. For clarity, Development Costs shall exclude RegulatoryCosts. 1.19 “Dollar” means a U.S. dollar, and “$” shall be interpreted accordingly. 1.20 “Drug Administration Law” means the laws, rules and regulation applicable to drug administration in the Territory, as amended from time totime. 3CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.21 “Facility” means, as applicable, a Party’s Manufacturing facility and such other facilities used by such Party (or those of its Affiliates or ThirdParty contractors) in the manufacture, packaging, labeling or storage of (i) Product, (ii) Finished Product, or (iii) materials utilized in the Manufacture orPackaging and Labeling of Product, including raw materials, auxiliary materials, intermediates, containers and packing materials, in each case with respect tothe Product for Development or Commercialization in the Field in the Territory hereunder. 1.22 “FDA” means the U.S. Food and Drug Administration or its successor. 1.23 “FD&C Act” means the United States Federal Food, Drug and Cosmetic Act, 21 U.S.C. 301 et seq, as it may be amended from time to time,and relevant regulations and guidelines promulgated thereunder. 1.24 “Field” means use in humans. 1.25 “Finished Product” means the Product in frozen vials, in full Packaging and Labeling and final presentation form ready for release to end-users. 1.26 “First Commercial Sale” means, with respect to a Product, the first sale of such Product in the Territory by or on behalf of Licensee or itsAffiliates to a Third Party (including wholesalers or distributors), after receipt of Regulatory Approval for such Product in the Territory. 1.27 “Force Majeure” means circumstances beyond the reasonable control of either Party, including acts of God, fires, explosions, earthquakes,floods, droughts, riots, acts of terrorism, wars, civil disturbances, sabotage, cyber attacks, accidents, strikes or other labor disputes, unforeseen materialshortages or supplier failures, compliance with any government action or any other event or circumstance of the like of different character to the foregoingbeyond the reasonable control and without the fault or negligence of a Party. 1.28 “General Development Activities” means all Development Activities other than Territory Development Activities. 1.29 “Good Clinical Practices” or “GCP” means all applicable Good Clinical Practice standards for the design, conduct, performance,monitoring, auditing, recording, analyses and reporting of clinical trials, including, as applicable, (i) those standards required by the PMDA, (ii) as set forth inthe International Conference on Harmonisation of Technical Requirements for Registration of Pharmaceuticals for Human Use (“ICH”) Harmonised TripartiteGuideline for Good Clinical Practice (CPMP/ICH/135/95) and any other guidelines for good clinical practice for trials on medicinal products in the Territory,(iii) the Declaration of Helsinki (2004) as last amended at the 52nd World Medical Association in October 2000 and any further amendments or clarificationsthereto, (iv) U.S. Code of Federal Regulations Title 21, Parts 50 (Protection of Human Subjects), 56 (Institutional Review Boards) and 312 (InvestigationalNew Drug Application), as may be amended from time to time, and (v) the equivalent Applicable Laws in any relevant country, each as may be amended andapplicable from time to time and in each case, that provide for, among other things, assurance that the clinical data and reported results are credible andaccurate and protect the rights, integrity, and confidentiality of trial subjects. 4CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.30 “Good Laboratory Practices” or “GLP” means all applicable Good Laboratory Practice standards, including, as applicable, (i) thosestandards required by the PMDA, (ii) as set forth in the then-current good laboratory practice standards promulgated or endorsed by the FDA as defined in 21C.F.R. Part 58, and (iii) the equivalent Applicable Laws in any relevant country, each as may be amended and applicable from time to time. 1.31 “Good Manufacturing Practices” or “GMP” means all applicable Good Manufacturing Practices including, as applicable, (i) thosestandards required by the PMDA, (ii) the principles detailed in the U.S. Current Good Manufacturing Practices, 21 C.F.R. Sections 210, 211, 601 and 610, (iii)the principles detailed in the ICH Q7 guidelines, and (iv) the equivalent Applicable Laws in any relevant country, each as may be amended and applicablefrom time to time. 1.32 “Government Official” means (a) any elected or appointed government official (e.g., a member of a ministry of health), (b) any employee orperson acting for or on behalf of a government official, agency, or enterprise performing a governmental function, (c) any political party, candidate for publicoffice, officer, employee, or person acting for or on behalf of a political party or candidate for public office, and (d) any employee or person acting for or onbehalf of a public international organization (e.g., the United Nations). For clarity, healthcare providers employed by government-owned hospitals shall beconsidered Government Officials. 1.33 “Governmental Authority” means any multinational, federal, state, local, municipal or other governmental authority of any nature(including any governmental division, prefecture, subdivision, department, agency, bureau, branch, office, commission, council, court or other tribunal), ineach case, having jurisdiction over the applicable subject matter. 1.34 “Indirect Taxes” means VAT, sales taxes, consumption taxes and other similar taxes required by law to be disclosed on the invoice. 1.35 “Invented” means the acts of (an) inventor(s), as determined in accordance with Applicable Laws relating to inventorship set forth in thepatent Applicable Laws of the United States (Title 35, United States Code), in discovering, conceiving and completing an Invention. 1.36 “Invention” means any writing, invention, discovery, improvement, technology or other Know-How (in each case, whether patented or not)that is not existing as of the Effective Date and is Invented during the Term and necessary for the Development and Commercialization of the Product in theField in the Territory. 1.37 “Joint Clinical Committee” or “JCC” means the joint clinical steering committee formed by the Parties as described in Section 3.1. 1.38 “Joint Management Committee” or “JMC” means the joint management committee formed by the Parties as described in Section 3.1. 1.39 “Joint Commercialization and Sales Committee” or “JCSC” means the joint sales committee formed by the Parties as described in Section3.1. 5CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.40 “Joint Invention” means an Invention that is Invented jointly by an employee of, or Person under an obligation of assignment to, each ofVBL and Licensee or their respective Affiliates. 1.41 “Know-How” means all present and future information, whether or not in written form, whether or not in the public domain and shall includebiological, chemical, pharmacological, toxicological, medical or clinical, analytical, quality, manufacturing, research, or sales and marketing information,including processes, methods, procedures, techniques, strategies, plans, programs and data. 1.42 “Licensee Invention” means an Invention that is Invented, solely or jointly with a Third Party, by an employee of Licensee or its Affiliates ora Person under an obligation of assignment to Licensee or its Affiliates, in the performance of this Agreement. 1.43 “Licensee Know-How” means all Know-How that is (i) (a) Controlled by Licensee (or its Affiliates) as of the Effective Date or comes underthe Control of Licensee (or its Affiliates) during the Term (other than as a result of the licenses granted by VBL to Licensee under this Agreement) and (b)incorporated by Licensee in any Product prior to any termination or expiration of this Agreement (provided, however, that such Know-How is necessary forthe Development, Manufacture or Commercialization of any Product) or (ii) a Licensee Invention. 1.44 “Licensee Patent” means any Patent that (i) is Controlled by Licensee (or its Affiliates) as of the Effective Date or comes under the Control ofLicensee (or its Affiliates) during the Term (other than as a result of the licenses granted by VBL to Licensee under this Agreement) and (ii) claims anyLicensee Know-How. 1.45 “Licensee Technology” means the Licensee Know-How and the Licensee Patents. 1.46 “Manufacture” or “Manufacturing” means all activities related to the manufacturing of the Product, the Finished Product, or any ingredientthereof, including manufacturing for clinical use or commercial sale, in-process and Product testing, quality assurance and quality control required for releaseof the Finished Product in the Field in the U.S., handling and storage of Product or Finished Product and ongoing stability tests and regulatory activitiesrelated to any of the foregoing; provided, however, that for purposes of clarity “Manufacture” shall exclude Packaging and Labeling (whether in commercialor clinical packaging presentation). 1.47 “Medical Science Liaison” means an individual who is employed by or on behalf of Licensee or its Affiliates and who provides educationalservices and other educational efforts directed towards the medical and/or scientific community. 1.48 “Net Sales” means the gross amount invoiced by or on behalf of Licensee or any of its Affiliates or permitted Sublicensees on account of salesof the Product, excluding VAT and less the following deductions specifically and solely related to the Product and actually allowed: (a) patient assistance programs and co-pay assistance, trade, quantity, early pay, distributor service (and related agreements) and cashdiscounts and/or rebates; 6CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (b) retroactive price reductions that are actually granted; (c) returns, rebates, chargebacks, , adjustments, credits, volume rebates, charge-back and prime vendor rebates, fees, reimbursements orsimilar payments granted or given to wholesalers and other distributors, buying groups, health care insurance carriers, pharmacy benefit managementcompanies, health maintenance organizations or other institutions or health care organizations, and other allowances; (d) any tax, tariff, customs duty, excise or other duty or other governmental charge (excluding any tax on income) levied on the sale,transportation or delivery of the Product; (e) any charge for freight, insurance or other transportation costs; and (f) the actual amount of any write-offs for bad debt relating to such sales. For clarity, Net Sales shall not be reduced by the amount of any commissions paid to individuals, whether they are associated with independent salesagencies or regularly employed by Licensee (or any agent, distributee, or designee thereof), or for a cost of collection or any other amount not specifically setforth in subsections 1.48(a) through (f) above. Any of the items set forth above that would otherwise be deducted from the invoice price in the calculation ofNet Sales but which are separately charged to, and paid by, any Third Party shall not be deducted from the invoice price in the calculation of Net Sales. Anyof the items set forth above that are deducted from the invoice price in the calculation of Net Sales for any period but which are later recovered by Licenseeshall be included in Net Sales for the period in which they are recovered. To the extent any of the items set forth above are included in the calculation of Costof Goods, such item shall not also be included in the calculation of Net Sales. In the case of any sale of the Product for value other than in an arm’s lengthtransaction exclusively for cash, such as barter or counter-trade, Net Sales shall be determined by referencing Net Sales at which substantially similarquantities of the Product are sold in an arm’s length transaction for cash. Notwithstanding the foregoing, (i) amounts billed by Licensee or its Affiliates for the sale of Product among Licensee or its Affiliates for resale and (ii)reasonable donations, reasonable product samples and reasonable clinical samples for which no consideration is received, shall not be included in thecomputation of Net Sales hereunder. Net Sales shall be accounted for in accordance with the Accounting Standards. Licensee and its Affiliates will sell theProduct as a stand-alone product and will not sell the Product as part of a bundle with other products or offer package deals to customers that include theProduct, except to the extent required to obtain sales contracts with government entities, and in such case, the price of the Product relevant for the calculationof Net Sales will be the average price in the preceding Calendar Quarter of the Product sold separately less the average discount of all products sold as part ofthe package. 1.49 “Out-of-Pocket Costs” means costs and expenses paid to Third Parties (or payable to Third Parties and accrued in accordance with theAccounting Standards), other than Affiliates or employees, by either Party. 1.50 “Patents” means patents and patent applications and all substitutions, divisions, continuations, continuations-in-part, any patent issued withrespect to any such patent applications, any reissue, reexamination, utility models or designs, renewal or extension (including any supplementary protectioncertificate) of any such patent, and any confirmation patent or registration patent or patent of addition based on any such patent, and all counterparts thereofin any country. 7CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.51 “Patent Term Extension” means any term extensions, supplementary protection certificates and equivalents thereof offering Patentprotection beyond the initial term with respect to any issued Patents. 1.52 “Person” means any corporation, limited or general partnership, limited liability company, joint venture, trust, unincorporated association,governmental body, authority, bureau or agency, any other entity or body, or an individual. 1.53 “Phase IV Clinical Trials” means certain post-marketing studies to delineate additional information about a pharmaceutical product’s risks,benefits, and optimal use, commenced after receipt of regulatory approval for a product in the indication for which such trial is being conducted. 1.54 “PMDA” means the Japan Pharmaceuticals and Medical Devices Agency or its predecessor or successor. 1.55 “Pre-Marketing” means marketing activities undertaken prior to and in preparation for the launch of the Product in the Territory. Pre-Marketing shall include market research, key opinion leader development, advisory boards, medical education, disease-related public relations, health careeconomic studies, sales force training and other pre-launch activities prior to the First Commercial Sale of the Product in the Territory. 1.56 “Product” means VB-111 (ofranergene obadenovec). 1.57 “Product Complaint” means any written, verbal or electronic expression of dissatisfaction regarding any Product sold by or on behalf ofLicensee (or any of its Affiliates or wholesalers) in the Territory, including reports of actual or suspected product tampering, contamination, mislabeling orinclusion of improper ingredients. 1.58 “Product Specifications” means those Manufacturing, performance, quality-control, and Packaging and Labeling specifications for theFinished Product in the Territory set forth in a schedule to the Quality Agreement, as such specifications may be amended from time to time pursuant to theterms of this Agreement and the Quality Agreement. 1.59 “Promotional Materials” means all written, printed, video or graphic advertising, promotional, educational and communication materials(other than the Product labels and package inserts) for marketing, advertising and promoting of the Product in the Field in the Territory, for use (i) by a SalesRepresentative, Medical Science Liaison, or other authorized employee or agent of Licensee, (ii) by a wholesaler, or (iii) in advertisements, web sites or directmail pieces. 1.60 “Quality Agreement” means each of the quality agreements between Licensee and VBL relating to the Product for clinical and Commercialuses. 8CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.61 “Regulatory Approvals” means all approvals or licenses necessary for the manufacture, marketing, importation, storage and sale of theProduct or a product for one or more indications in a country or regulatory jurisdiction, which may include satisfaction of all applicable regulatory andnotification requirements, but which shall exclude any pricing or reimbursement approvals. 1.62 “Regulatory Authority” means, in a particular country or regulatory jurisdiction, any applicable Governmental Authority involved ingranting Regulatory Approval and/or, to the extent required in such country or regulatory jurisdiction, governmental pricing or reimbursement approval of aProduct in such country or regulatory jurisdiction, including, in the Territory, the PMDA. 1.63 “Regulatory Costs” means the costs and expenses incurred by Licensee or its Affiliates attributable to, or reasonably allocable to, thepreparation, obtaining or maintaining of Regulatory Materials and Regulatory Approvals for the Product (other than Manufacturing-related RegulatoryApprovals), including any filing fees and such costs and expenses incurred by VBL or its Affiliates to the extent requested by Licensee or required by thisAgreement. “Regulatory Costs” shall include (i) Out-of-Pocket Costs and (ii) internal costs (e.g., staff or administrative) that are specifically attributable tothe preparation of Regulatory Materials, and obtaining or maintenance of Regulatory Approvals, for the Product in the Field in the Territory. 1.64 “Regulatory Data” means any and all research data, pharmacology data, chemistry, manufacturing and control data, preclinical data, clinicaldata, safety data, pharmacovigilance data and all other documentation submitted, or required to be submitted, to Regulatory Authorities in association withregulatory filings for the Product (including any applicable Drug Master Files (“DMFs”), Chemistry, Manufacturing and Control (“CMC”) data, or similardocumentation). 1.65 “Regulatory Materials” means regulatory applications, submissions, notifications, communications, correspondence, registrations,Regulatory Approvals and/or other filings made to, received from or otherwise conducted with a Regulatory Authority that are necessary in order to Develop,Manufacture, obtain marketing authorization, market, sell or otherwise Commercialize the Product in a particular country or regulatory jurisdiction.Regulatory Materials include CTAs, presentations, responses, and applications for other Regulatory Approvals. 1.66 “Royalty Term” means the period of time beginning on the First Commercial Sale of the Product and ending upon the later of: (i) the date onwhich the Product (including, the use, sale, offer for sale, importation, development or manufacturing thereof) is no longer Covered by a Valid Claim in theTerritory or by data protection exclusivity for the Product in the Territory, or (ii) the [***] anniversary of the First Commercial Sale of the Product in theTerritory. 1.67 “Sales Representative” means an individual employed by Licensee who (a) engages in detailing and other activities as a commercialpharmaceutical sales representative that are in compliance with Applicable Laws, and who is trained with respect to the Product, including the Productlabeling and the legal use of such labeling, to engage in such activities with respect to the Product in the Field in the Territory, and (b) has not beenthreatened with or excluded or debarred by any Regulatory Authority. 9CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.68 “Sublicense Income” means any and all fees or payments received by Licensee in consideration for granting a Third Party (other than anorganization performing sales, research or other activities for the benefit of and on behalf of Licensee and under supervision of Licensee) a sublicense toDevelop and Commercialize under the VBL Technology, consisting of (i) upfront license fees and (ii) milestone payments for Development orCommercialization of the Product. For clarity, Sublicense Income shall not include (x) royalty payments made to Licensee on account of sales of the Productassociated with such sublicense that have been included in Net Sales hereunder or (y) payments made to Licensee on account of services provided by or onbehalf of Licensee to Sublicensee (including research and development services), for any product supply from Licensee to Sublicensee or as equityinvestments into Licensee or its Affiliates, to the extent that, in the case of each payment described in this clause (y), such payments are at prices equivalentto those that would be negotiated at arms’ length by unaffiliated parties. 1.69 “Supply Price” means the applicable amount invoiced by VBL per dose of Finished Product in accordance with Section 7.5(a) or Section7.5(b), as applicable. 1.70 “Territory” means Japan. 1.71 “Territory Development Activities” means those Development Activities consistent with the Development Plan that are (i) necessary forobtaining or maintaining Regulatory Approval for the Product in the Field solely with respect to the Territory and (ii) post-Regulatory Approval-filing dateDevelopment Activities for the Product in the Field solely with respect to the Territory. Notwithstanding the foregoing, in the event that Licensee requeststhat VBL perform certain Development Activities within the Territory and the Parties agree that VBL shall perform such activities within the Territory inaccordance with Section 4.2.1(c), then such activities as are conducted in the Territory shall be deemed Territory Development Activities. 1.72 “Third Party” means any Person other than VBL or Licensee or their respective Affiliates. 1.73 “U.S.” means the United States of America and its possessions and territories. 1.74 “VBL Invention” means an Invention that is Invented solely or jointly with a Third Party, by an employee of VBL or its Affiliates or a Personunder an obligation of assignment to VBL or its Affiliates. For clarity, “VBL Invention” shall not include (a) the VBL Patents or (b) the (i) VBLManufacturing Patents or (ii) VBL Manufacturing Know-How. 1.75 “VBL Know-How” means all Know-How that is (i) Controlled by VBL (or its Affiliates) as of the Effective Date or at any time during theTerm or (ii) a VBL Invention, in each case of (i) or (ii) which is necessary for the Development or Commercialization of the Product in the Field in theTerritory; provided, however that “VBL Know-How” shall not include any VBL Manufacturing Know-How. For clarity, “VBL Know-How” shall not include(a) the VBL Patents or (b) the (i) VBL Manufacturing Patents or (ii) VBL Manufacturing Know-How. 10CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.76 “VBL Manufacturing Know-How” means all Know-How that is (i) Controlled by VBL (or its Affiliates) as of the Effective Date or at anytime during the Term or (ii) a VBL Invention or a Joint Invention, in each case of (i) or (ii) which is necessary for Manufacture of the Product forCommercialization in the Field in the Territory but is not otherwise necessary for the Development or Commercialization in the Field in the Territory,including any CMC information. 1.77 “VBL Manufacturing Patent” means any Patent that is (i) Controlled by VBL (or its Affiliates) as of the Effective Date or at any time duringthe Term or (ii) a VBL Patent, in each case of (i) or (ii), which is necessary for the Manufacture of the Product for Commercialization in the Field in theTerritory but is not otherwise necessary for the Development or Commercialization of the Product in the Territory. 1.78 “VBL Patent” means the Patents listed in Schedule 1.78, and any other Patent in the Territory that is (i) Controlled by VBL (or its Affiliates)as of the Effective Date, or (ii) that comes under the Control of VBL during the Term, in each case of (i) or (ii) which is necessary for the Development orCommercialization of the Product in the Field in the Territory; provided, however that “VBL Patent” shall not include any VBL Manufacturing Patent. 1.79 “VBL Technology” means the VBL Patents and VBL Know-How. 1.80 “Valid Claim” means a claim of an VBL Patent or a Collaboration Patent that (i) has not been rejected, revoked or held to be invalid orunenforceable by a court or other authority of competent jurisdiction, from which decision no appeal can be further taken or (ii) has not been finallyabandoned, disclaimed or admitted to be invalid or unenforceable through reissue or disclaimer. 1.81 Interpretation. Except where expressly stated otherwise in this Agreement, the following rules of interpretation apply to this Agreement: (i)“include”, “includes” and “including” are not limiting; (ii) “hereof”, “hereto”, “herein” and “hereunder” and words of similar import when used in thisAgreement refer to this Agreement as a whole and not to any particular provision of this Agreement; (iii) “knowledge” of a Party means the actual knowledgeof any officer of such Party involved in the negotiation of this Agreement, without the obligation to perform due inquiry; (iv) words of one gender includethe other gender; (v) words using the singular or plural number also include the plural or singular number, respectively; (vi) references to a contract or otheragreement mean such contract or other agreement as from time to time amended, modified or supplemented; (vii) references to a Person are also to itspermitted successors and assigns; (viii) references to an “Article”, “Section”, “Exhibit” or “Schedule” refer to an Article or Section of, or an Exhibit orSchedule to, this Agreement, unless expressly stated otherwise; and (ix) references to a law include any amendment or modification to such law and any rulesand regulations issued thereunder, whether such amendment or modification is made, or issuance of such rules and regulations occurs, before or after theEffective Date. 11CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 1.82 Additional Definitions. The following terms have the meanings set forth in the corresponding Sections of this Agreement: Term Section“Agreement” Preamble“Assignment Consideration” 14.1.7“Bankrupt Party” 14.5“Breaching Party” 13.2“CMC” 1.64“Collaboration Patents” 9.1.1“Commercialization Data” 6.11“Commercialization Plan” 6.2.1“Compliance Audit” 6.6“Confidential Disclosure Agreement” 12.1“Confidential Information” 12.1“Cost of Goods” 7.5(c)“Defect” or “Defective” 7.7.2(a)“Development Budget” 4.3.1(c)“Development Data” 4.6“Development Plan” 4.3.1“Disclosing Party” 12.1“DMFs” 1.64“Effective Date” Preamble“Executive Officer” 15.2“Financial Audit” 8.10“Forecast” 7.4.1“Forecast Date” 7.4.1“GBM Indication” 4.1.2“Global Branding Strategy” 6.10“ICC Rules” 15.3“ICH” 1.29“Improvement Plan” 6.5.5“Indemnitee” 11.3“Infringement Claim” 9.3.1“Initial Commercialization Plan” 6.2.1“Initial Development Plan” 4.3.2“Initial Forecast Date” 7.4.1“Latent Defects” 7.7.2(b)“Licensee” Preamble“Long Range Forecast” 7.4.2“Losses” 11.1“Major Supply Failure” 7.10“Milestone Notification Notice” 8.2“Notice of Non-Conformance” 7.7.2(a)“OOS” 7.7.3“OOT” 7.7.3“Packaging and Labeling” 7.3.1“Party” or “Parties” Preamble“Product Trade Dress” 6.9.1 12CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Term Section“Product Trademark” 6.9.1“Provisions” 6.5.4“Purchase Order” 7.4.3“Purchase Order Acceptance Date” 7.4.4“Receiving Party” 12.1“Recovery” 9.3.2(c)(iv)“Redacted Agreement” 12.5.2“Representatives” 6.5.3“Required Notice Date” 16.5“Royalty Payments” 8.3.1“Secondary Source” 7.1.4“Sublicense Income Payment” 8.3.2“Sublicensee” 2.1.3“Term” 13.1“Third Party Claim” 11.1“Third Party License” 8.4“Transfer Costs” 14.1.7“Upfront Payment” 8.1“VAT” 8.6.1“VBL” Preamble ARTICLE 2LICENSES 2.1 Grant to Licensee. 2.1.1 General Grant to Licensee. Subject to the terms and conditions of this Agreement, VBL hereby grants to Licensee during the Term anexclusive (even as to VBL and its Affiliates, except as to any Territory Development Activities or other cooperation activities agreed by the Parties to beperformed by VBL pursuant to Section 4.2.1), payment-bearing license with the right to sublicense solely in accordance with Section 2.1.3, under and withrespect to the VBL Technology, to (i) Develop the Product for Commercialization in the Field in the Territory and (ii) Commercialize the Product in the Fieldin the Territory. 2.1.2 Trademark Grant to Licensee. Subject to the terms and conditions of this Agreement, including in particular Section 6.9, VBL herebygrants to Licensee during the Term an exclusive (even as to VBL and its Affiliates) license with the right to sublicense solely in accordance Section 2.1.3, touse the Product Trademark and Product Trade Dress solely to the extent necessary to (i) Commercialize the Product in the Field in the Territory and (ii)Package and Label the Product for Development or Commercialization in the Field in the Territory. 13CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 2.1.3 Licensee’s Right to Sublicense. Licensee shall have the right to sublicense those rights granted to it under Sections 2.1.1 and 2.1.2 to(i) Affiliates, subject to Licensee’s prior written notice to VBL of the identity of such Affiliate and the purpose of such sublicense, and (ii) Third Parties,subject to first obtaining VBL’s prior written consent to such sublicense, which consent shall not be unreasonably withheld, delayed or conditioned, andshall be deemed given if VBL does not provide a response within thirty (30) days after the date of Licensee’s request with reasonable detail noting thereasons for any rejection (each of (i) and (ii), a “Sublicensee”); provided, however, that Licensee shall remain responsible for the performance by any of itsSublicensees and shall cause its Sublicensees to comply with the provisions of this Agreement in connection with such performance. Without limiting theforegoing, (i) Licensee shall ensure that each of its Sublicensees accepts in writing all applicable terms and conditions of this Agreement, including withoutlimitation the reporting, audit, inspection and confidentiality provisions hereunder, and shall terminate all relevant agreements with any such Sublicensee inthe case of any material breach of such terms and conditions by such Sublicensee; and (ii) Licensee shall use Commercially Reasonable Efforts to include inany sublicense a provision equivalent to Section 9.6 of this Agreement. Each Sublicensee shall be prohibited from further sublicensing without the priorwritten consent of VBL, which shall not be unreasonably withheld (with such further sublicensee being deemed a Sublicensee thereafter). For the avoidanceof doubt, (a) Licensee will remain directly responsible for all amounts owed to VBL under this Agreement, and (b) each Sublicensee is subject to the negativecovenants set forth in Section 2.3.1 and Section 2.4. Licensee hereby expressly waives any requirement that VBL exhaust any right, power or remedy, orproceed against a subcontractor, for any obligation or performance hereunder prior to proceeding directly against Licensee. 2.1.4 Performance by Affiliates and Subcontractors. Licensee shall have the right to perform some or all of its obligations under thisAgreement through Affiliates and/or Third Party subcontractors in the Territory; provided, however, that Licensee shall cause its Affiliates and subcontractorsto accept the applicable terms and conditions of this Agreement in connection with such performance. 2.2 Grant to VBL. Subject to the terms and conditions of this Agreement, Licensee hereby grants to VBL, during the Term, an exclusive,sublicensable, royalty-free license, for the sole purpose of Developing, Manufacturing and/or Commercializing the Product outside of the Territory, underand with respect to such Licensee Technology that is developed or conceived by Licensee in the performance of this Agreement. 2.3 Additional Licensing Provisions. 2.3.1 Negative Covenant. Each Party covenants that it will not use or practice any of the other Party’s Patent rights or other intellectualproperty rights licensed (or sublicensed, as applicable) to it under this ARTICLE 2 except for the purposes expressly permitted in the applicable license grant. 2.3.2 No Implied Licenses; Retained Rights. Except as explicitly set forth in this Agreement, neither Party grants any license, express orimplied, under its intellectual property rights to the other Party, whether by implication, estoppel or otherwise. 14CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 2.4 Restrictive Covenants. 2.4.1 Licensee. Licensee hereby covenants that it shall not (and shall cause its Affiliates and Sublicensees not to), either directly or indirectly(including on its own, with or through any Affiliate, or in collaboration with a Third Party), during the Term, knowingly market, distribute or sell the Productinto countries outside of the Territory or for use outside of the Field. Without limiting the generality of the foregoing, with respect to such countries outsideof the Territory, and indications outside of the Field, Licensee shall not (i) knowingly engage in any advertising activities relating to the Product directedsolely to customers located in such countries, (ii) solicit or knowingly fulfill, directly or indirectly, orders from any prospective purchaser located in part or inwhole in such countries, (iii) engage in any advertising activities relating to the Product directed to use in part or in whole outside the Field, or (iv) solicit orfulfill, directly or indirectly, orders from any prospective purchaser for use of the Product outside the Field in the Territory. In the event that Licensee (or anyof its Affiliates) enters into any agreements with a Sublicensee or subcontractor (including, any distributors or wholesalers) for the Product, it shall include inany and all said agreements provisions substantially similar to those set forth in this Section 2.4.1, such that such Sublicensee or subcontractor shall only beauthorized to market, distribute and sell the Product within the Field in the Territory, and shall be prohibited from marketing or fulfilling, directly orindirectly, distributing or selling the Product outside the Field or outside the Territory, and providing for the termination of any such Sublicensee’s orsubcontractor’s agreement in the event of a failure to comply with such provisions. In furtherance of the foregoing, in the event that Licensee or anySublicensee violates the provisions of this Section 2.4.1, Licensee shall pay, or cause to be paid, to VBL the full amount of any Net Sales of the Productoutside of the Field or the Territory; provided, that, such payment shall not limit VBL’s other remedies with respect thereto. 2.4.2 Limit on Licensee Invention. Licensee hereby covenants to VBL that Licensee will not reverse engineer, modify or create derivativesor improvements on or permit its Affiliates or Sublicensees to reverse engineer, modify or create derivatives or improvements on, VB-111. 2.4.3 Jurisdictional Compliance. It is the desire and intent of the Parties that the restrictive covenants contained in this Section 2.4 beenforced to the fullest extent permissible under the Applicable Laws and public policies applied in each jurisdiction in which enforcement is sought. VBLand Licensee believe that the restrictive covenants in this Section 2.4 are valid and enforceable. However, if any restrictive covenant should for any reasonbecome or be declared by a competent court or competition authority to be invalid or unenforceable in any jurisdiction, such restrictive covenant shall bedeemed to have been amended to the extent necessary in order that such provision be valid and enforceable, such amendment shall apply only with respect tothe operation of such provision of this Section 2.4 in the particular jurisdiction in which such declaration is made. 15CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 3GOVERNANCE 3.1 Governance Committees. 3.1.1 Joint Management Committee. The Parties shall establish the JMC within thirty (30) days after the Effective Date. The JMC shallperform the following functions: (a) Review, coordinate, discuss and approve the overall strategy for Developing the Product in the Field in the Territory, includingreviewing, coordinating, discussing and approving the overall strategy for seeking Regulatory Approvals for the Product in the Field in the Territory andapproving the Development Plan and each annual update and any material amendments thereto; (b) Review, coordinate, discuss and approve the design of the clinical trial protocols and endpoints and oversee the conduct of all clinicaltrials required as set forth in the Development Plan as well as discuss any Territory Development Activities to be conducted with respect to the Product in theField; (c) Review any matters related to obtaining and maintaining Regulatory Approvals for the Product in the Field in the Territory, includingbeing informed of the development and contents of all submissions to Regulatory Authorities in the Territory for Regulatory Approvals and all necessaryfiling and registration activities related thereto; (d) Review, coordinate, discuss and approve any Phase IV Clinical Trials in the Territory, investigator-sponsored studies in the Territory,and any other clinical studies to be conducted in the Territory that are not described in the Development Plan(s); (e) Facilitate the exchange of information between the Parties under this Agreement regarding the strategy for implementing theDevelopment Activities in the Territory, including sharing Development Data created pursuant to this Agreement and establishing procedures for theefficient sharing of information and materials necessary or useful for the Development of the Product in the Field in the Territory; (f) Review and oversee issues regarding supply of Product for clinical trials and Phase IV Clinical Trials in the Territory under theDevelopment Plan(s) and for anticipated commercial needs; (g) Review and oversee issues regarding pharmacovigilance and safety both inside and outside the Territory; and (h) Have such other responsibilities as may be assigned to the JMC pursuant to this Agreement or as may be mutually agreed upon by theParties in writing from time to time. 3.1.2 Joint Clinical Committee. Within thirty (30) days after the Effective Date, the Parties shall also establish a joint clinical committee(the “Joint Clinical Committee” or “JCC”) to oversee the Development of the Product in the Territory, including reviewing and overseeing theimplementation of plans and timelines for such Development. 3.1.3 Joint Commercialization and Sales Committee. At an appropriate and agreed time following the Effective Date, (but no later thantwelve (12) months prior to anticipated filing for Regulatory Approval in the Territory), the Parties shall establish a joint commercial and sales committee(the “Joint Commercialization and Sales Committee” or “JCSC”) to oversee Commercialization of the Product in the Territory, including reviewing andapproving the Commercialization Plan and overseeing the implementation of such plan. 16CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 3.1.4 Membership and Procedures. Each Committee shall consist of an equal number of representatives from each Party, with at least two(2) representatives appointed by each Party. A Party may change any of its representatives on each Committee at any time with a new person (withappropriate expertise to replace the outgoing member) by giving written notice to the other Party; provided, however, that, without limiting the generality ofthe foregoing, a key objective with respect to membership in the Committees shall be preserving continuity. The Committees shall be chaired by arepresentative of Licensee. One member of each Committee shall serve as secretary of the Committee at each Committee meeting, and the secretary shallalternate from meeting to meeting between a Licensee member and a VBL member. The chairpersons shall be responsible for (i) calling meetings, (ii)preparing and issuing minutes of each such meeting within thirty (30) days thereafter, and (iii) preparing and circulating an agenda for the upcomingmeeting; provided, that the chairpersons shall include any agenda items proposed by either Party no less than one (1) day prior to the next scheduledCommittee meeting. 3.1.5 Meetings. Each Committee shall hold at least one (1) meeting per Calendar Quarter at such times during such Calendar Quarter as itelects to do so until pre-launch Territory Development Activities for the Product in the Field in the Territory are completed, or at the request of any twomembers of a Committee, and thereafter, if the Parties mutually so decide, twice per year; provided, that the committees shall meet more or less frequently asLicensee and VBL mutually agree upon as appropriate. Meetings of any Committee shall be effective only if at least one (1) representative of each Party ispresent or participating. Committees may meet either (i) in person at either Party’s facilities (alternating between the facilities of Licensee and VBL) or atsuch locations as the Parties may otherwise agree or (ii) by audio or video teleconference; provided, that no less than one (1) meeting of the JMC during eachCalendar Year shall be conducted in person to the extent permissible under Applicable Laws. Other representatives of each Party involved with the Productmay attend meetings as non-voting participants, subject to the confidentiality provisions set forth in ARTICLE 12. Additional meetings of the JMC may alsobe held with the consent of each Party, as required to resolve disputes, disagreements or deadlocks in the other Committees or as otherwise required under thisAgreement, and neither Party shall unreasonably withhold its consent to hold such additional meetings. 3.1.6 Decision-Making. Each Committee may make decisions with respect to any subject matter that is subject to its decision-makingauthority and functions as set forth in this Section 3.1. All decisions of the Committee shall be made by unanimous vote or written consent, with Licenseeand VBL each having, collectively, among its respective members, one (1) vote in all decisions. If any Committee other than the JMC cannot reachunanimous agreement on any issue, such issue shall be referred to the JMC for resolution. The JMC shall use good faith efforts to resolve the matters withinits roles and functions or otherwise referred to it. Except as set forth in Section 6.2 with respect to the determination of Sales Targets in the InitialCommercialization Plan, if the JMC cannot reach consensus on a given matter, then decision-making authority shall be allocated: (i) to Licensee to theextent the disagreement relates to development activities directed toward Development in the Territory or Commercialization Activities within the Territory(unless (x) a change in the Development Plan proposed by Licensee does not involve an investigator-initiated trial or a trial required or suggested by aRegulatory Authority and (y) VBL can show with reasonable evidence that such change proposed by Licensee is reasonably likely to have a material andadverse effect on Development and Commercialization of the Product outside the Territory, in which case VBL shall have final decision-making authority);and (ii) to VBL with respect to any matter other than the foregoing. If Licensee proposes a change in development activities directed toward the Territory thatdoes not involve an investigator-initiated trial or a trial required or suggested by a Regulatory Authority, and VBL believes that such change is reasonablylikely to materially and adversely affect Development and Commercialization of the Product outside the Territory, Licensee shall not implement suchchanges unless and until it is determined, in accordance with the provisions of Article 15, that such changes are not reasonably likely to materially andadversely affect Development and Commercialization of the Product outside the Territory. For the avoidance of doubt, no Committee shall have the power toalter the timelines included in the Development Plan or the Sales Targets included in the Initial Commercialization Plan, or to amend this Agreement,without the consent of both Parties. 17CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 3.2 Committees. From time to time, the Parties may establish and delegate duties to other committees to oversee particular matters (each suchcommittee, JMC, JCC or JCSC, a “Committee”). Each such Committee shall be constituted and shall operate as the Parties reasonably and mutuallydetermine as reflected in a written agreement between the Parties; provided, that each Committee shall have equal representation from each Party. 3.3 Limits on Committee Authority. The JMC, JCC, JCSC and any other Committee shall have only the powers assigned expressly to it in thisARTICLE 3 and elsewhere in this Agreement, and shall not have any power to amend, modify or waive compliance with this Agreement. In furtherancethereof, each Party shall retain the rights, powers and discretion granted to it under this Agreement and no such rights, powers or discretion shall be delegatedor vested in the JMC, JCC, JCSC or any other Committee unless such delegation or vesting of rights is expressly provided for in this Agreement or the Partiesexpressly so agree in writing. Without limiting the generality of the foregoing, the JMC, JCC, JCSC and any other Committee shall have no decision-makingauthority with respect to any matters related to (i) approving (or otherwise making decisions with respect to) matters related to obtaining, maintaining orenforcing Patent protection for the Product in the Field in the Territory (which matters shall be governed by ARTICLE 9), (ii) the Development of the Productoutside the Field or for sale outside of the Territory, (iii) the Commercialization of the Product outside the Field or outside of the Territory or (iv) theManufacture of the Product, provided that the JMC, JCC, JCSC and any other Committee may discuss and exchange information regarding any of theforegoing matters to the extent relating to or useful for the Development and/or Commercialization of the Product in the Field and in the Territory. 3.4 Actions. In developing strategies, making decisions and exercising its rights under this Agreement (including acting through its representativeson any of the Committees), each Party shall act in good faith. 3.5 Exchange of Information. Licensee shall keep VBL fully and promptly informed as to its progress and activities in material aspects relating tothe Development and Commercialization of the Product in the Territory, including with respect to regulatory matters and meetings with RegulatoryAuthorities, by way of updates to appropriate Committees at their meetings or directly in writing in English as reasonably requested from time to time byVBL. In connection therewith, Licensee shall provide VBL with such information regarding such progress and activities under the Development Plan or theCommercialization Plan, or otherwise relating to the Product, as VBL may reasonably request from time to time. In addition, VBL shall keep Licenseeinformed on a timely basis as to any progress or activities outside of the Territory or outside of the Field that may impact or otherwise be helpful for theDevelopment or Commercialization of the Product in the Field and in the Territory, including with respect to regulatory matters and meetings withRegulatory Authorities outside of the Territory or outside of the Field, by way of updates to appropriate Committees at their meetings or directly in writing inEnglish as reasonably requested from time to time by Licensee. 18CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 3.6 Minutes of Committee Meetings. Definitive minutes of all Committee meetings shall be finalized no later than thirty (30) days after eachmeeting. The minutes shall be approved by each Party not later than the first order of business at the immediately succeeding Committee meeting. 3.7 Expenses. Each Party shall be responsible for all of its own expenses incurred in connection with participating in the JMC, JCC or JCSCmeetings or any of the other Committee meetings. ARTICLE 4DEVELOPMENT 4.1 Overview. 4.1.1 Overview of Development. Subject to the terms and conditions of this Agreement, Licensee shall be responsible for conducting, inaccordance with the Development Plan(s), the Territory Development Activities, including bridging studies, clinical studies, Phase IV Clinical Studies (andother post-Regulatory Approval studies), with the necessary assistance of VBL to the extent such assistance is required by Applicable Laws in the Territory oragreed on by the parties, for the purpose of (i) enabling obtaining Regulatory Approval in the Territory for Product in the Field and (ii) maximizing thecommercial potential for Product in the Field in the Territory. 4.1.2 General Development Activities and Development Outside the Territory or Outside the Field; Regulatory Approvals Outside theTerritory or Outside the Field. VBL shall, or shall cause its affiliates or licensees to, use Commercially Reasonable Efforts to conduct its GeneralDevelopment Activities in a manner designed to achieve successful Development and Regulatory Approval for the treatment of glioblastoma (the “GBMIndication”) in the U.S., including the filing of a BLA with the FDA with respect thereto within the timeframe specified on Schedule 4.3.2 hereof. The Partieshereby agree and acknowledge that nothing contained herein shall limit or otherwise restrict the ability of VBL or its other licensees or sublicensees, asapplicable, to (i) perform the General Development Activities as it sees fit and at its sole discretion, (ii) Develop the Product for use or sale outside theTerritory (whether or not in the Field) or in the Territory but outside the Field and (iii) obtain or maintain Regulatory Approvals for the Product outside theTerritory (whether or not in the Field) or outside the Field; provided that in each case, any use of Licensee Technology in connection therewith is subject tothe terms of the license granted by Licensee to VBL pursuant to Section 2.2. Without limiting the generality of the foregoing, the Development Plan(s) shallnot address (a) any General Development Activities (other than as separately agreed by the Parties), (b) any activities which are necessary solely for obtainingor maintaining Regulatory Approval for the Product in any country outside the Territory or outside the Field. 19CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 4.1.3 Certain Additional Restrictions. Licensee agrees and acknowledges that it and its Affiliates shall not conduct any Development of theProduct except in accordance with the Development Plan established pursuant to this Agreement. 4.2 Objectives Under the Development Plan. 4.2.1 Development Activities. (a) Licensee shall use Commercially Reasonable Efforts to carry out the Territory Development Activities set forth in the Development Planin accordance with the time frames set forth therein and in a manner designed to achieve successful Development and Regulatory Approval for the treatmentof the GBM Indication in the Territory. (b) Upon agreeing to a new Development Plan for any additional indication(s) for the Product in the Field and in the Territory other thanthe GBM Indication, Licensee shall use Commercially Reasonable Efforts to carry out the Territory Development Activities set forth in such DevelopmentPlan in accordance with the time frames set forth therein and in a manner designed to achieve successful Development and Regulatory Approval for eachother indication within the Field. (c) Licensee may request that VBL perform, or cooperate with Licensee to perform, certain Territory Development Activities within theTerritory. Upon such request, the Parties shall discuss in good faith and agree upon the scope and details of VBL’s Territory Development Activities, if any,and amend the applicable Development Plan accordingly. Thereafter, subject to the payment or reimbursement of certain Development Costs as set forth inSection 4.4.1, VBL shall use Commercially Reasonable Efforts to carry out such Territory Development Activities set forth in such Development Plan inaccordance with the time frames set forth therein and in a manner designed to achieve successful Development and Regulatory Approval for the treatment ofthe applicable indication in the Territory. (d) In the event that pre-clinical studies are required to obtain Regulatory Approval for the Product in the Territory, Licensee shall requestthat VBL perform such studies, and VBL shall use Commercially Reasonable Efforts to perform such studies itself or through Third Parties; provided that ifVBL declines to perform, or is incapable of performing, such studies, Licensee shall have rights to perform such studies itself or through Third Parties. 4.2.2 Specific Development Diligence. With respect to the Product for the GBM Indication, Licensee shall (i) assuming the RegulatoryMaterials to be provided by VBL hereunder are sufficient for submitting a CTA in Japan, submit a CTA in Japan in accordance with the timeline set forth inSchedule 4.3.2, (ii) subject to VBL’s timely supply of required quantities of clinical samples, initiate clinical testing in Japan within [***] after obtainingCTA approval therefor, (iii) complete such trial within [***] after it is initiated, and (iv) file an Approval Application within [***] after completion of suchtrial. With respect to the Product for the ovarian cancer indication, the Parties shall meet with key opinion leaders, contract research organizations and otherexperts in such indication in order to generate a new Development Plan for such indication within [***] after the Effective Date. 20CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 4.2.3 Compliance. Each Party shall conduct its Development Activities in accordance with sound and ethical business and scientificpractices, and in compliance with all Applicable Laws and GXPs. Neither Party shall use in any capacity, in connection with its Development (orCommercialization) of Product hereunder, any Person who has been debarred pursuant to Section 306 of the FD&C Act (or similar Applicable Laws outside ofthe U.S.), or who is the subject of a conviction described in such section, and each Party shall inform the other in writing immediately if it or any Person whois performing services for it hereunder is debarred or is the subject of a conviction described in Section 306 (or similar Applicable Laws outside of the U.S.),or if any action, suit, claim, investigation or legal administrative proceeding is pending or, to such Party’s knowledge, is threatened, relating to the debarmentof such Party or any Person used in any capacity by such Party in connection with its Development (or Commercialization) of Product hereunder. 4.3 Development Plan and Development Budget. 4.3.1 General. In connection with the Development of the Product for use in the GBM Indication in the Territory, Licensee shall conductTerritory Development Activities in accordance with the Initial Development Plan, as the same may be amended from time to time by the JMC in accordancewith this Agreement. In connection with the Development of the Product for use in the other indications in the Territory, Licensee shall conduct TerritoryDevelopment Activities, if any, for such indication pursuant to a comprehensive development plan for such indication agreed upon by the Parties (each,together with the Initial Development Plan, a “Development Plan”). Each Development Plan shall set forth, among other things, the following: (a) any studies or trials (including Phase IV Clinical Trials) necessary for obtaining and maintaining Regulatory Approval in theTerritory, in each case, together with all protocols, endpoints and primary investigators conducting such studies, with respect to the Product in the Field inthe Territory, including a timeline for commencement and completion of clinical trials; (b) all regulatory plans and other elements of obtaining and maintaining Regulatory Approvals in the Field in the Territory, includingthe plans and timeline for preparing the necessary Regulatory Materials and for obtaining Regulatory Approval in the Field in the Territory; and (c) a detailed annual budget for all Development Costs and Regulatory Costs for the activities in the applicable Development Plan(the “Development Budget”). 4.3.2 Initial Development Plan. The initial Development Plan for the Product for the GBM Indication (the “Initial Development Plan”) isset forth as Schedule 4.3.2. To the extent that future “national meetings” with the Regulatory Authorities in the Territory provide guidance with respect to therisk management plan or Territory Development Activities, the Parties shall consider such guidance in updating and amending the Development Planpursuant to Section 4.3.3. 21CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 4.3.3 Updating and Amending Development Plan and Development Budget; Additional Development Activities. (a) Licensee shall have the right to initiate and lead discussions for (i) any revisions to a Development Plan or (ii) the development of anynew Development Plan for any additional indications. On or before September 30th of each Calendar Year during the Term, Licensee shall submit to the JCCany proposed revisions to a Development Plan or proposals for a new Development Plan, and the JCC shall review, update and approve amendments to ornew proposals for such Development Plan, which shall cover the Territory Development Activities to be conducted during the upcoming Calendar Year. (b) The JCC shall, on at least a Calendar Quarter basis, review and update, as appropriate, each then-current Development Plan to reflect anymaterial changes, reprioritizations of, or additions to such Development Plan. Notwithstanding the foregoing, from time to time during the Term, either Partymay submit to the JCC any proposed expansion or other material amendment of the Development Plan to cover additional Territory Development Activities(or otherwise amend the Territory Development Activities) with respect to the Product for use in the Field in the Territory for the JCC’s review and approval.Once approved by the JCC, each amended Development Plan shall become effective and supersede the previous Development Plan as of the date of suchapproval or at such other time as decided by the JCC. For the avoidance of doubt, no timelines included in any Development Plan may be altered, or thisAgreement amended, without the consent of both Parties. (c) With respect to the Development Budget, such budget shall be included within the Development Plan and provided to the JCC for itsreview; provided, however, that such budget shall be developed and finalized, and thereafter revised, in Licensee’s sole discretion. 4.4 Development Costs. 4.4.1 Territory Development Activities. Unless otherwise agreed by the Parties or by any applicable Committee, Licensee shall be [***] ofall Development Costs incurred by: (i) Licensee; or (ii) to the extent approved by the JMC or JCC or included in a Development Plan and DevelopmentBudget, VBL (except to the extent as described in the next sentence), with respect to any Territory Development Activities (including, for clarity, any givenDevelopment Activities which are deemed Territory Development Activities in accordance with Section 1). To the extent reasonably requested by Licensee,VBL shall cooperate and assist Licensee in the performance or implementation of Territory Development Activities necessary for Regulatory Approval of theProduct in the Territory. However, Licensee shall bear any reasonable, documented and pre-approved (i) Out-of-Pocket Costs incurred by VBL in performingor implementing such assistance and (ii) internal labor costs for any assistance by VBL requiring VBL personnel to travel to Japan in excess of [***] (with thehourly rate per full-time equivalent being [***]), and VBL shall invoice Licensee for such costs, which invoices Licensee shall pay within thirty (30) days ofreceipt thereof. 22CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 4.4.2 General Development Activities. VBL shall be responsible for one hundred percent (100%) of all Development Costs incurred by VBLwith respect to any General Development Activities. 4.5 Records, Reports and Information. 4.5.1 General. Licensee (and VBL, to the extent it conducts any Territory Development Activities) shall, and shall cause each of itsAffiliates, and permitted Sublicensees and Third Party subcontractors to, maintain current and accurate records of all work conducted by it under theDevelopment Plan and all data and other information resulting from such work (which records shall include, as applicable, books, records, reports, researchnotes, charts, graphs, comments, computations, analyses, recordings, photographs, computer programs and documentation thereof (e.g., samples of materialsand other graphic or written data generated in connection with the Development Activities)). Such records shall properly reflect all work done and resultsachieved in the performance of the Development Activities in sufficient detail and in good scientific manner appropriate for regulatory and patent purposes.Licensee (and VBL, to the extent it conducts any Territory Development Activities) shall document all preclinical studies and clinical trials to be conductedpursuant to the Development Plan in formal written study reports according to applicable national and international (e.g., ICH, GCP and GLP) guidelines.Upon reasonable request, VBL (and Licensee, to the extent VBL conducts any Territory Development Activities) shall be provided with copies of or access todrafts of reports resulting from Territory Development Activities conducted under the Development Plan. 4.5.2 Status Updates. (a) Licensee (and VBL, to the extent it conducts any Territory Development Activities) shall provide the JMC with reports detailing itsrespective Territory Development Activities and the results thereof at least five (5) Business Days prior to any JMC meeting, but in any event, on at least aCalendar Quarter basis. Without limiting the foregoing, Licensee shall promptly, but in any event within fifteen (15) days after receipt thereof, provide toVBL copies of any material documents or correspondence received from any Regulatory Authority related to Territory Development Activities. (b) VBL shall provide the JMC with reports detailing its General Development Activities and the results thereof at least five (5) BusinessDays prior to any JMC meeting, but in any event, on at least a Calendar Quarter basis. In addition, VBL shall promptly, but in any event within fifteen (15)days after receipt of a request from Licensee, provide to Licensee any correspondence with Regulatory Authorities required for Development of the Productwithin the Territory. 4.5.3 Access to Records. VBL shall have the right to review all records under the Development Plan maintained by Licensee and itsSublicensees and Third Party subcontractors at reasonable times, upon reasonable written request. 4.6 Ownership and Transfer of Development Data. All data (including pre-clinical, clinical, technical, chemical, safety, and scientific data andinformation), know-how and other results generated by or resulting from or in connection with the conduct of Development Activities, including relevantlaboratory notebook information, screening data, Regulatory Data and synthesis schemes, including descriptions in any form, data and other information(collectively, the “Development Data”), shall be owned solely and exclusively by the Party generating such data which shall be Confidential Information ofsuch Party (and each Party shall use Commercially Reasonable Efforts to require that all of its Affiliates and subcontractors assign any of such Affiliates’ andsubcontractors’ right, title and interest in and to such Development Data to such Party). With respect to Development Data generated by a Party hereunder,such Party shall promptly provide the other Party with copies of reports and, if available, summaries thereof, in each case through the applicable Committeeand the data sharing processes agreed by such Committee. 23CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 4.7 Right to Audit. Licensee shall ensure that VBL’s authorized representatives and any Regulatory Authorities, to the extent permitted byApplicable Laws, may, during regular business hours and upon reasonable advance written notice, (i) examine and inspect its facilities or, subject to anyThird Party confidentiality restrictions and other obligations, the facilities of any subcontractor or any investigator site used by Licensee in the performanceof Development of the Product in the Field in the Territory hereunder, and (ii) subject to Applicable Laws and any Third Party confidentiality restrictions andother obligations, inspect all data, documentation and work product to the extent reasonably available to Licensee relating to the activities performed by it,the subcontractor or investigator site, including the medical records of any patient participating in any clinical study, in each case generated pursuant to thesaid Development. This right to inspect all data, documentation, and work product relating to the Product in the Field in the Territory may be exercised oncefor each Calendar Year (and more frequently if any material issues are discovered pursuant to an authorized audit) during the Term upon reasonable notice, orsuch longer period as shall be required by Applicable Laws. The audit rights described in this Section 4.7 are without limitation of other audit rightsdescribed elsewhere in this Agreement. ARTICLE 5REGULATORY 5.1 Regulatory Data and Regulatory Materials. 5.1.1 Regulatory Data Generated by VBL and Licensee. Within thirty (30) days after the Effective Date, VBL and Licensee shall meet andagree upon the portion of Regulatory Materials and Regulatory Data which is in VBL’s possession and that is necessary for Licensee to perform itsobligations hereunder and VBL shall thereafter supply Licensee with such Regulatory Materials and Regulatory Data as promptly as reasonably practicable.During the Term, VBL and Licensee shall each promptly provide to the other copies of any further Regulatory Materials and Regulatory Data that either maygenerate or otherwise acquire, and at any time during the Term, Licensee may request to meet with VBL to discuss additional Regulatory Materials andRegulatory Data that VBL can provide to Licensee. For clarity, Regulatory Materials and Regulatory Data generated or acquired by VBL’s sublicensees shallbe included in such Regulatory Materials and Regulatory Data to be provided by VBL to Licensee to the extent that such materials are accessible to andControlled by VBL. 5.1.2 Use of Data by Licensee. Licensee may only use the Regulatory Materials and Regulatory Data, and any other Development Data,provided by VBL hereunder for the purposes of Developing and Commercializing the Product, and obtaining and maintaining Regulatory Approval for theProduct, in the Field in the Territory pursuant to this Agreement. VBL may use the Regulatory Materials and Regulatory Data, and any other DevelopmentData, provided by Licensee hereunder for the purposes of Development and Commercialization of and obtaining and maintaining Regulatory Approval ofthe Product (a) outside the Territory (whether in the Field or outside Field) and (b) outside the Field. 24CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.1.3 Regulatory Materials. Each Party shall, as soon as reasonably practicable after the same become available, provide the other Party withcopies of the core data sheet, approved local prescriber, and patient-directed, labeling that are proposed or approved for the Commercialization andDevelopment of the Product in the Field in the Territory, with respect to Licensee, or outside the Field or outside the Territory, with respect to VBL. 5.2 Regulatory Filings and Regulatory Approvals. 5.2.1 General Responsibilities; Ownership of Regulatory Approvals. Subject to Section 5.2.4, as between the Parties, (a) Licensee shall beresponsible for the preparation of all Regulatory Materials necessary or desirable for obtaining and maintaining the Regulatory Approvals for the Product inthe Field in the Territory (including in connection with Patient Information Leaflets, labeling and packaging for the Product in the Field in the Territory) andLicensee shall submit such Regulatory Materials, as applicable, to the applicable Governmental Authorities in the Territory and (b) VBL shall be responsiblefor the preparation of all Regulatory Materials necessary or desirable for obtaining and maintaining the Regulatory Approvals for the Product in the Fieldoutside of the Territory, including in the U.S. (including in connection with Patient Information Leaflets, labeling and packaging for the Product in the Fieldoutside of the Territory), and VBL shall, or shall cause its affiliates or licensees to, submit such Regulatory Materials, as applicable, to the applicableGovernmental Authorities outside of the Territory and maintain such Regulatory Approvals outside of the Territory, including in the U.S., for the Term of thisAgreement. For clarity, to the extent allowed by Applicable Laws, all Regulatory Approvals for the Product in the Field in the Territory (other than thoserelated solely to the Manufacture of the Finished Product, if any, which it is agreed shall be held and owned by VBL) shall be held and owned by Licensee inits name. In the event that the Applicable Law does not allow Licensee to be the holder of certain Regulatory Approvals for the Product in the Territory, suchRegulatory Approval shall be held by VBL in its name with the intent to provide under this Agreement to Licensee the privileges of ownership of (andrelated usage rights for) such Regulatory Approvals and related Regulatory Materials. In furtherance of the foregoing, (i) to the extent required by ApplicableLaws or a Regulatory Authority (which requirement shall be notified in writing by Licensee to VBL), or (ii) at the reasonable request of Licensee, then VBLor its designee shall attend key meetings with the relevant Regulatory Authorities with respect to obtaining or maintaining the Regulatory Approvals for theProduct in the Field in the Territory, at Licensee’s cost and expense; provided, that, to the extent the subject matter of such meeting makes it appropriategiven the allocation of responsibilities herein (e.g., VBL’s responsibility for Manufacturing the Product), then VBL or its designee may attend such meetingat VBL’s cost and expense. 25CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.2.2 Cost of Regulatory Activities. All Regulatory Costs incurred in connection with the preparation by or on behalf of Licensee ofRegulatory Materials for, and obtaining of, Regulatory Approvals in the Field in the Territory for Product shall be borne solely by Licensee. Licensee shall beresponsible for all Regulatory Costs involved in the maintenance of all Regulatory Approvals for Product in the Field in the Territory. VBL shall invoiceLicensee for Regulatory Costs it incurs in connection with the preparation of Regulatory Materials for, and obtaining of Regulatory Approvals in, the Fieldin the Territory for the Product to the extent that such Regulatory Costs to be incurred by VBL are incurred in accordance with the Development Plan or haveotherwise been approved by Licensee in writing, which invoices Licensee shall pay within forty-five (45) days of receipt thereof. 5.2.3 Reporting and Review. Licensee shall keep VBL reasonably and regularly informed in connection with the preparation of allRegulatory Materials, Regulatory Authority review of Regulatory Materials, and Regulatory Approvals, in each case with respect to Product for sale in theField in the Territory. Licensee shall provide VBL, within five (5) days to the extent material, and otherwise within fifteen (15) days, with copies of allnotices, questions, and requests for information in tangible form which it receives from a Regulatory Authority with respect to Product for sale in the Field.Similarly, VBL shall provide Licensee, within five (5) days, with copies of all notices which it receives from a Regulatory Authority outside of the Territoryand which may have a material impact on the development, manufacture or sale of the Product in the Territory. 5.2.4 Consultation and Approval Prior to Regulatory Filings. The Parties shall consult with each other on the strategy for pre-authorizationactivities (i.e., Regulatory Authority meetings) and post-authorization activities, with respect to Regulatory Approvals for the Product in the Field in theTerritory prior to the filing. Without limitation of the foregoing, Licensee shall provide VBL (through the applicable Committee) with a copy of all proposedRegulatory Materials in English for review prior to filing, and subject to Section 3.1.6, Licensee shall take into account any reasonable comments receivedfrom VBL in finalizing the Regulatory Materials to the extent VBL provides comments in a timely manner (which for this purpose shall mean within thirty(30) days after receiving such Regulatory Materials); provided that, if such Regulatory Materials are required in order to obtain Regulatory Approval for theProduct in the Field in the Territory, then Licensee may submit such Regulatory Materials but shall use reasonable efforts to revise them to the extentpossible to take into account VBL’s comments. 5.3 Communications. The Parties shall cooperate in communicating with any Regulatory Authority having jurisdiction regarding the Product inthe Field whether within the Territory or outside the Territory and Licensee shall immediately notify VBL in the event that Licensee (or any of its Affiliates,Sublicensees, subcontractors, wholesalers or distributors) communicates, or intends to communicate, either on its own initiative in accordance with thisAgreement or as a result of such a Regulatory Authority initiating contact with such Person in connection therewith. Notwithstanding the foregoing, exceptas may be required by Applicable Laws, Licensee (and its Affiliates, Sublicensees, subcontractors, wholesalers and distributors) shall not, with respect to theProduct, communicate with (i) any Regulatory Authority having jurisdiction outside the Territory regarding the Product or (ii) any Regulatory Authority withrespect to the Product for use outside the Field, in each case, unless explicitly provided for in the Development Plan or requested or permitted in writing to doso by VBL, or unless so ordered by such Regulatory Authority, in which case Licensee shall immediately notify VBL of such order and shall, to the extentpermitted by Applicable Laws, not take any further actions or communicate with such Regulatory Authority further until VBL has provided instruction as tohow to proceed, which instruction shall be given reasonably in advance of the deadline, if any. All communications with Regulatory Authorities regardingthe Product in the Field in the Territory shall be undertaken as provided in this Agreement. 26CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.4 No Other Regulatory Filings. Except as otherwise expressly set forth in ARTICLE 5, Licensee (and its Affiliates) shall not file any RegulatoryMaterials or Regulatory Approvals for the Product or that are otherwise based on any VBL Technology or any Collaboration Patents, unless otherwise agreedby the Parties. 5.5 Rights of Reference. 5.5.1 Licensee’s Rights. VBL shall permit Licensee (and its Affiliates or permitted Sublicensees) to access, and shall provide Licensee (andits Affiliates or permitted Sublicensees) with sufficient rights to reference and use, in association with exercising Licensee’s rights and performing itsobligations under this Agreement, VBL’s Development Data, Regulatory Materials and Regulatory Approvals outside the Territory that are associated withthe Product in the Field. VBL shall transmit to the extent accessible to and Controlled by VBL all necessary and appropriate letters to applicable RegulatoryAuthorities advising such applicable Regulatory Authorities of such rights of reference and use. 5.5.2 VBL’s Rights. Licensee shall permit VBL (and its Affiliates or permitted Sublicensees) to access, and shall provide VBL (and itsAffiliates or permitted Sublicensees) with sufficient rights to reference and use, in association with exercising its rights and performing its obligations underthis Agreement, Licensee’s Development Data, Regulatory Materials and Regulatory Approvals in the Territory that are associated with the Product. Licenseeshall transmit to the extent accessible to and Controlled by Licensee all necessary and appropriate letters to applicable Regulatory Authorities advising suchapplicable Regulatory Authorities of such rights of reference and use. 5.6 Adverse Event Reporting, Safety Data Exchange and Medical Inquiries. 5.6.1 Pharmacovigilance. Subject to the terms of this Section 5.6.1, each Party shall be responsible for its respective pharmacovigilanceobligations under Applicable Laws. Licensee, as the intended beneficiary under this Agreement of the privileges of ownership of the Regulatory Approvals inthe Field in the Territory, shall be responsible for the collection, review, assessment, tracking and filing of information related to adverse events associatedwith the Product in the Territory (whether or not Regulatory Approval has been achieved), in each case in accordance with Applicable Laws and thisAgreement (and Licensee shall ensure that, in the Development and Commercialization of the Product, it will record, investigate, summarize, notify, reportand review all adverse events in accordance with Applicable Laws, including, for clarity, laws relating to adverse event reporting in the Territory). VBL (or itsdesignee) shall be responsible for the collection, review, assessment, tracking and filing of information related to adverse events associated with the Productin the countries outside the Territory. The safety units from each of the Parties shall meet and agree upon a written pharmacovigilance agreement forexchanging adverse event and other safety information relating to the Product promptly following the Effective Date, and in any event, prior to Licensee’sfirst clinical activity or prior to the first Regulatory Approval in the Territory (whichever is first). Such written pharmacovigilance agreement shall ensure thatadverse event associated with the Product and other safety information is exchanged according to a schedule that will permit each Party (and its designees orits sublicensees) to comply with Applicable Laws and regulatory requirements in their respective markets. 27CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.6.2 Global Safety Database. VBL shall be responsible for maintaining the global safety database for Product. The writtenpharmacovigilance agreement prescribed by Section 5.6.1 shall ensure that adverse event and other safety information is exchanged according to a schedulethat will permit VBL (and each of its designees and sublicensees, as applicable) to comply with Applicable Laws and regulatory requirements in theirrespective markets. VBL shall provide Licensee with reasonable access to such global safety database without any compensation to VBL. 5.6.3 Medical Inquiries for the Product. Following the Effective Date, Licensee, as the intended beneficiary under this Agreement of theprivileges of ownership of the Regulatory Approvals in the Field in the Territory, shall be responsible for handling all medical questions or inquiries in theTerritory, including all Product Complaints, with regard to any Product sold by or on behalf of Licensee (or any of its Affiliates), in each case in accordancewith Applicable Laws and this Agreement. VBL shall provide a copy of any standardized responses to medical inquiries to Licensee for Licensee’s use withrespect to the Product in the Field in the Territory. VBL shall immediately forward any and all medical questions or inquiries which it receives with respect toany Product sold by or on behalf of Licensee (or any of its Affiliates) in the Territory to Licensee in accordance with all Applicable Laws and Licensee shallimmediately forward to VBL any and all medical questions or inquiries that it receives with respect to Product (i) not sold by or on behalf of Licensee (or anyof its Affiliates) in the Territory or (ii) outside of the Territory, in each case in accordance with all Applicable Laws. Notwithstanding the foregoing, VBLshall be responsible for handling all Product Complaints other than those related to the Development and Commercialization of the Product in the Field inthe Territory, and Licensee shall refer all such Product Complaints to VBL. Licensee shall be responsible for handling all Product Complaints related to theDevelopment and Commercialization of the Product in the Field in the Territory, and VBL shall refer all such Product Complaints to Licensee. 5.7 Regulatory Authority Communications Received by a Party. 5.7.1 General. Each Party shall immediately inform the other Party of notification of any action by, or notification or other informationwhich it receives (directly or indirectly) from, any Regulatory Authority whether inside the Territory or outside the Territory which (i) raises any materialconcerns regarding the safety or efficacy of the Product; (ii) indicates or suggests a potential material liability of either Party to Third Parties in connectionwith the Product; (iii) is reasonably likely to lead to a recall, market withdrawal or market notification with respect to the Product whether inside the Territoryor outside the Territory; or (iv) relates to expedited and periodic reports of adverse events with respect to the Product whether inside the Territory or outsidethe Territory, or Product Complaints, and which may have an adverse impact on Regulatory Approval or the continued Commercialization of the Productwhether inside the Territory or outside the Territory. Licensee shall be solely responsible for responding to any such communications relating to the Productin the Field in the Territory and the Parties shall reasonably cooperate with and assist each other in complying with regulatory obligations, including by VBLproviding to Licensee such information and documentation which is in VBL’s possession as may be necessary or reasonably helpful for Licensee to prepare aresponse to an inquiry from a Regulatory Authority in the Territory with respect to the Product in the Field. Each Party shall also promptly provide the otherParty with a copy of all correspondence received from a Regulatory Authority whether inside the Territory or outside the Territory specifically regarding thematters referred to above. VBL (or its designee) shall be solely responsible for any communications relating to the Product outside of the Territory or outsidethe Field. 28CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.7.2 Disclosures. In addition to its obligations under this Agreement, each Party shall disclose to the other Party (and such Party shall havethe right to subsequently disclose to its designees or sublicensees (in the case of VBL) or permitted Sublicensees (in the case of Licensee)) the followingregulatory information: (a) all material information pertaining to actions taken by Regulatory Authorities, whether inside the Territory or outside the Territory, inconnection with the Product in the Field, including any notice, audit notice, notice of initiation by Regulatory Authorities of investigations, inspections,detentions, seizures or injunctions concerning the Product in the Field, notice of violation letter (i.e., an untitled letter), warning letter, service of process orother inquiry; provided, however, that a Party shall be entitled to redact those portions thereof to the extent not related to the Product in the Field. Withoutlimiting the generality of the foregoing, each Party shall promptly, but in any event within two (2) Business Days, inform the other Party of any inspections,proposed regulatory actions, investigations or requests for information or a meeting by any Regulatory Authority with respect to the Product in the Fieldwhether inside the Territory or outside the Territory; and (b) all information pertaining to notices from Regulatory Authorities, whether inside the Territory or outside the Territory, of non-compliance with Applicable Laws in connection with the Product, including receipt of a warning letter or other notice of alleged non-compliance from anyRegulatory Authority relating to the Product; provided, however, that a Party shall be entitled to redact those portions thereof to the extent not related to theProduct. 5.8 Recall, Withdrawal, or Market Notification of Product. 5.8.1 Notification and Determination. In the event that any Governmental Authority threatens or initiates any action to remove the Productfrom the market in the Field whether inside the Territory or outside the Territory (in whole or in part), the Party receiving notice thereof shall notify the otherParty of such communication immediately, but in no event later than one (1) Business Day, after receipt thereof. Notwithstanding the foregoing, in all casesLicensee, as the intended beneficiary under this Agreement of the privileges of ownership of the Regulatory Approvals in the Field in the Territory, shalldetermine (and notify VBL with respect to such determination) whether to initiate any recall, withdrawal or market notification of the Product in the Field inthe Territory, and VBL, acting as the holder of the Regulatory Approval, shall act on behalf of Licensee in any recall, withdrawal and market notification ofthe Product. VBL shall determine whether to initiate any such recall, withdrawal or market notification of the Product outside the Field in the Territory, oroutside the Territory, including the scope of such recall or withdrawal (e.g., a full or partial recall, temporary or permanent recall, or “dear doctor” letter) ormarket notification; provided, however, that, before Licensee or VBL (as the case may be) initiates a recall, withdrawal or market notification in the Territory,the Parties shall promptly meet and discuss in good faith the reasons therefor; provided, that such discussion shall not delay any action that is required to betaken under Applicable Laws in relation to any recall, withdrawal or market notification. In the event of any such recall, withdrawal or market notification inthe Territory, Licensee shall determine the necessary actions to be taken, and shall implement such action, with VBL providing reasonable input (whichLicensee shall in good faith consider and incorporate into any recall, withdrawal or market notification strategy) and reasonable assistance, to conduct suchrecall, withdrawal or market notification. Without limiting the foregoing, in the event of a recall, withdrawal or market notification outside the Territory, VBLshall have the right to cause Licensee to initiate a Product recall, withdrawal or market notification in the Territory; provided, however, that, before VBL cancause Licensee to initiate a recall, withdrawal or market notification in the Territory, the Parties shall promptly meet and discuss in good faith the reasonstherefor. Licensee shall at all times utilize a batch tracing system which will enable the Parties to identify, on a prompt basis, customers within the Territorywho have been supplied with Product of any particular batch, and to recall such Product from such customers as set forth in this Section 5.8.1. 29CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.8.2 Cost Allocation. All direct costs and expenses associated with implementing a recall, withdrawal or market notification with respect tothe Product in the Field in the Territory shall be allocated between VBL and Licensee as follows: (a) in the event, and to the extent, that the recall, withdrawal or market notification arises as a result of a material breach of thisAgreement by any Party, then such Party shall bear the costs and expenses, including internal expenses and Out-of-Pocket Costs of the other Party, forimplementing such recall, withdrawal or market notification; and (b) in all other events, including where that the recall, withdrawal or market notification arises as a result of any adverse event or othersafety issues concerning the Product not as a result of a material breach of this Agreement by any Party, then the costs and expenses incurred by either Party,including internal expenses and Out-of-Pocket Costs, for implementing such recall, withdrawal or market notification, shall be allocated between the Partiesas agreed by the Parties; provided, that, if the Parties are unable to agree on such allocation within thirty (30) days after notice in writing by one Party to theother Party, then the Parties shall refer such dispute to arbitration in accordance with Section 15.3. Until such an allocation is agreed or determined, each ofthe Parties will bear fifty percent (50%) of such costs and expenses and shall make reconciliation payments to each other on a timely basis in order toeffectuate such cost sharing. ARTICLE 6COMMERCIALIZATION 6.1 Commercialization in the Field in the Territory. During the Term, Licensee shall be solely responsible for Commercializing the Product inthe Territory for use in the Field, which Commercialization shall be in accordance with the Commercialization Plan and this Agreement. Licensee shall beresponsible for one hundred percent (100%) of the expenses (including Pre-Marketing and other Commercialization expenses) incurred in connection withthe Commercialization of the Product in the Territory for use in the Field. Without limiting the foregoing, Licensee shall use Commercially ReasonableEfforts to Commercialize the Product for use in the Field in the Territory; provided, that VBL is in compliance with its obligations to supply Product inaccordance with ARTICLE 7 of this Agreement. 30CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.2 Commercialization Plan. 6.2.1 Initial Commercialization Plan. On an annual basis commencing with the Calendar Year in which the first filing for RegulatoryApproval in the Field in the Territory is expected to be made, Licensee shall prepare a commercialization plan with respect to the Commercialization of theProduct in the Field in the Territory pursuant to this Agreement (the “Commercialization Plan”). The initial Commercialization Plan (i.e., for the Product forthe Calendar Year in which the Regulatory Approval is expected to be received) will be prepared by Licensee (the “Initial Commercialization Plan”) at anappropriate and agreed time following the Effective Date (but no later than twelve (12) months before the expected date of receipt of such RegulatoryApproval in the Territory) and shall be subject to approval by the JCSC; provided that if after good faith discussions at the JCSC and, if necessary, the JMC,the Parties cannot agree on reasonable targets for sales of the Product in the Territory per Calendar Year, commencing after the First Commercial Sale of theProduct in the Territory (the “Sales Targets”), they shall be determined in accordance with Article 15. 6.2.2 Updates to Commercialization Plan. On an annual basis no later than October 15 of each Calendar Year (except as set forth in Section6.2.1), Licensee shall create and submit to the JCSC for its review, discussion and approval the Commercialization Plan for the following Calendar Year.From time to time during a given Calendar Year, Licensee may propose written updates to the Commercialization Plan for review, discussion and approval bythe JCSC. Licensee shall conduct all Commercialization of the Product in accordance with the Commercialization Plan and this Agreement. 6.2.3 Contents of Commercialization Plan. Each annual Commercialization Plan shall include, among other things, a summary of thefollowing items in connection with the Commercialization of the Product in the Territory for use in the Field: (a) the short and long term vision for the Product and Product positioning; a situation analysis; a Strengths, Weaknesses,Opportunities and Threats (SWOT) analysis; and a description of critical issues, strategic imperatives and tactics by strategic imperative with timelines, fromeach of the following perspectives: marketing, sales, reimbursement and distribution; (b) the minimum level of sales efforts to be dedicated to the promotion of the Product (including expenditure thereon); (c) any material Promotional Materials and campaigns, including publication plans, to be used, subject to Section 6.8.1, inconnection with the promotion of the Product in the Field; (d) Commercialization activities to be focused on the hospital setting; and (e) the forecast of Product unit sales, gross sales, and Net Sales, including anticipated pricing and discounting strategies. 31CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.3 Licensee’s Performance. 6.3.1 Specific Commercialization Obligations. Without limiting the generality of the provisions of Section 6.1, in connection with theCommercialization of the Product in the Territory for use in the Field by Licensee hereunder: (a) Licensee shall (i) use Commercially Reasonable Efforts to Commercialize Product for use in the Field in the Territory andmaximize the commercial potential for Product in the Field in the Territory, (ii) represent Product accurately and fairly, (iii) Commercialize Product so as toreflect favorably on Product and the good name, goodwill and reputation of VBL; (iv) act in good faith to attempt to maximize the economic value ofProduct and (v) use Commercially Reasonable Efforts to meet the Sales Targets set forth in the Commercialization Plan, provided that VBL is in compliancewith its obligations to supply Product in accordance with ARTICLE 7 of this Agreement and (vi) achieve the minimum level of sales activities for thepromotion of the Product to be agreed by the JCSC and set forth in the Commercialization Plan (e.g., minimum number of sales representatives dedicated tothe Product, minimum priority level for the Product, minimum number of sales details to potential prescriber accounts). (b) Licensee shall not (i) disparage, defame, discredit, or negatively comment to Third Parties in any way about or concerning theProduct or VBL (including VBL’s activities, operations or other products) nor permit its employees, officers or directors to do so, (ii) utilize deceptive,misleading or unethical business practices, or (iii) knowingly take any action that would reasonably be likely to prejudice the value of Product. (c) Licensee shall be solely responsible for (i) receiving, accepting and filling orders for the Product in the Field in the Territory, (ii)handling all returns of the Product in the Field in the Territory, (iii) controlling invoicing, order processing and collection of accounts receivable for the salesof the Product in the Field in the Territory, and (iv) distributing and managing inventory of the Product in the Field in the Territory. (d) Licensee shall use Commercially Reasonable Efforts to launch the Product in the Territory within a reasonable time after allapplicable Regulatory Approvals for Product have been obtained as agreed by the Parties and set forth in the Commercialization Plan, and shall thereafterensure that the Product remains commercially available in the Territory for the duration of the Royalty Term, subject to adequate supply of the Product byVBL in accordance with ARTICLE 7 of this Agreement. (e) Following the First Commercial Sale of the Product in the Field in the Territory and for the duration of the Royalty Term, Licenseeshall use Commercially Reasonable Efforts to maximize the market access of the Product in the Field in the Territory. 6.3.2 Commercialization Plan. Without limiting the obligations of Licensee under Sections 6.3.1, Licensee shall use CommerciallyReasonable Efforts to carry out the Commercialization activities in the Commercialization Plan in accordance with the time frames set forth in theCommercialization Plan. 32CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.4 Reports. Without limiting Licensee’s quarterly reporting obligations under Section 8.5 with respect to Net Sales, Royalty Payments andSublicense Income, Licensee shall (i) within thirty (30) days after the end of each Calendar Year, provide VBL a reasonably detailed report regarding itssignificant Commercialization activities involving Product during the preceding Calendar Year, including number of sales representatives and details, andoverall marketing expenditures; and (ii) within three (3) months after the end of each Calendar Year, provide VBL the number of prescriptions written(aggregated by province) to the extent such number of prescriptions written can be provided by IMS (or a similar internationally recognized informationservice). In addition, Licensee shall update the JCSC no less than twice per Calendar Year regarding its significant Commercialization activities involvingthe Product. 6.5 Compliance. 6.5.1 Reporting. Each Party shall ensure that all government reporting (including price and gift reporting), and manufacturing, sales,marketing and promotional practices, in respect of the Product in the Territory meet the standards required by all Applicable Laws, including withoutlimitation (i) the Drug Administration Law, (ii) any anti-unfair competition law of the Territory, and (iii) the Anti-Corruption Laws. Each of VBL andLicensee shall reasonably cooperate with the other Party to provide the other Party access to any and all information, data and reports required by the other inorder to comply with the provisions of Applicable Laws required in the respective jurisdictions in which each Party manufactures or sells the Product,including reporting requirements, in a timely and appropriate manner. Each Party shall ensure that its reporting under governmental healthcare programs inthe respective jurisdictions in which each Party manufactures or sells the Product is true, complete and correct in all respects; provided, however, that a Partyshall not be held responsible for submitting erroneous reports if such deficiencies result from information provided by the other Party which itself was nottrue, complete and correct. 6.5.2 Corporate Compliance Program. Each Party shall maintain an effective comprehensive corporate compliance program that iscompliant with Applicable Laws; provided, however, that, whether or not required by Applicable Laws, such compliance program will include a mechanismfor its employees and the public to report, anonymously if they choose, any concerns about potential illegal activity relating to the Product. Such complianceprogram will require such Party to investigate any such report of wrongdoing. At the other Party’s request, each Party shall provide to the other written copiesin English of any reports of any investigations initiated by Governmental Authorities in the respective jurisdictions as to the knowledge of such Party. 6.5.3 General Compliance Obligations. Each Party specifically agrees, on behalf of itself and its Affiliates, sublicensees andsubcontractors, and its and their respective officers, directors and employees (together with such Party, the “Representatives”), to comply with ApplicableLaws and, specifically, in connection with the subject matter of this Agreement: (a) The Representatives shall not directly or indirectly pay, offer or promise to pay, authorize the payment of any money or give, offer orpromise to give, or authorize the giving of anything else of value, to: (a) any Government Official in order to influence official action; (b) any individual orentity (whether or not a Government Official) (1) to influence such individual or entity to act in breach of a duty of good faith, impartiality or trust (“actingimproperly”), (2) to reward such individual or entity for acting improperly or (3) where such individual or entity would be acting improperly by receiving themoney or other thing of value; (c) any individual or entity (whether or not a Government Official) while knowing or having reason to know that all or anyportion of the money or other thing of value will be paid, offered, promised or given to, or will otherwise benefit, the individuals or entities for the purposeslisted in clauses (a) and (b) above. 33CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (b) The Representatives shall not, directly or indirectly, solicit, receive or agree to accept any payment of money or anything else of valuein violation of the Anti-Corruption Laws. (c) The Representatives shall comply with the Anti-Corruption Laws and shall not take any action that will, or would reasonably beexpected to, cause either Party or its Affiliates to be in violation of any such laws or policies. (d) No Representative that will participate or support its performance of its obligations hereunder has, directly or indirectly, (i) paid, offeredor promised to pay or authorized the payment of any money, (ii) given, offered or promised to give or authorized the giving of anything else of value or (iii)solicited, received or agreed to accept any payment of money or anything else of value, in each case ((i), (ii) and (iii)), in violation of the Anti-CorruptionLaws during the three (3) years preceding the date of this Agreement. (e) Each Representative shall have acquired all applicable licenses, permits, qualifications, approvals or authorizations by the competentGovernmental Authority in each jurisdiction in which it operates, in accordance with Applicable Laws. (f) Each Party shall promptly provide the other Party with written notice of the following events: (i) upon becoming aware of any actual oralleged breach or violation by such Party or its Representative of any obligation in this Section 6.5 or (ii) upon receiving a formal notification that it is thetarget of an investigation by a governmental authority for a violation of the Anti-Corruption Laws or upon receipt of information from any of theRepresentatives connected with this Agreement that any of them is the target of an investigation by a governmental authority for a violation of the Anti-Corruption Laws. Each Party shall be responsible for any breach of any obligation under this Section 6.5 or of the Anti-Corruption Laws by any of its Representatives. 6.5.4 Non-Compliance. On the occurrence of any of the following events: (a) a Party (as the reporting Party) becomes aware of, whether or not through a Compliance Audit, that the other Party or any of itsRepresentatives is in breach or violation of any obligation in this Section 6.5 or of the Anti-Corruption Laws; or 34CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (b) notification is received under Section 6.5.3(f) relating to any suspected or actual violation of the Anti-Corruption Laws by the otherParty or any of its Representatives, then, in either case ((a) or (b)), the reporting Party shall have the right, in addition to any other rights or remedies underthis Agreement or to which the reporting Party may be entitled in law or equity, to: (i) take such steps as are reasonably necessary in order to avoid a potentialviolation or continuing violation by the other Party or any of its Representatives of the Anti-Corruption Laws, including by requiring that the other Partyagrees to such additional measures, including possible self-disclosures, representations, warranties, undertakings and other provisions as are reasonablynecessary (“Provisions”); and (ii) terminate this Agreement in its entirety immediately: (A) in the event that the breach or violation by the other Party whichis the subject of the notice pursuant to Section 6.5.3(f)(i) is confirmed by an internal investigation of the compliance team of the other Party, and has not beencured to the reasonable satisfaction of the reporting Party within thirty (30) days after receipt of such notice (provided, that the reporting Party shall have theright in its sole discretion to challenge the finding of the other Party’s internal investigation and, upon exercising such right, the Parties agree to cooperatewith, and submit any and all evidence in connection with such investigation to, an internationally recognized law firm mutually selected by the Parties inorder to resolve such dispute within thirty (30) days after such submission and the Parties agree to be bound by the final decision rendered in connectiontherewith); or (B) in the event that an investigation which is the subject of the notice pursuant to Section 6.5.3(f)(ii) is concluded with a finding that the otherParty violated the Anti-Corruption Laws. 6.5.5 Effective Date Status; Improvement Plan. Each Party represents and warrants that (i) it has reviewed its internal programs in relationto compliance with Applicable Laws and the Anti-Corruption Laws in advance of the signing of this Agreement, and (ii) it and the other Representatives canand will continue to comply with such Applicable Laws and Anti-Corruption Laws in performance of its obligations hereunder. Should any measures beidentified at meetings of the applicable Committee(s) that should be reasonably taken to improve the Representatives’ compliance with such Anti-CorruptionLaws for the performance of its obligations hereunder (the “Improvement Plan”), the applicable Party shall implement such Improvement Plan within anagreed reasonable timeframe (which shall in any event not be in excess of three (3) calendar months) from the date the Improvement Plan is delivered to suchParty. 6.5.6 Compliance Certification. Within thirty (30) days of each anniversary of the Effective Date (i.e., once per Calendar Year on theanniversary of the Effective Date), Licensee shall submit to VBL a written certification by an appropriate corporate officer of Licensee, in a form acceptable toVBL, regarding Licensee’s (and its Affiliates, sublicensees and subcontractors, as applicable) compliance with the terms of this Section 6.5. 6.5.7 Disclaimer. Each Party acknowledges that compliance with the Anti-Corruption Laws and other Applicable Laws by it and itsRepresentatives is the responsibility of such Party under this Section 6.5, and agrees that the other Party shall have no liability to such Party or any of itsRepresentatives by reason of the other Party’s exercise (or failure to exercise) its rights or performance of its obligations under this Section 6.5. 6.6 Compliance Audit. For the Term, Licensee shall, for the purpose of auditing and monitoring the performance of its compliance obligationshereunder, permit VBL and its Affiliates or the auditors of any of them to have once per Calendar Year (or more frequently upon a showing of good reason),upon reasonable notice, access to any premises of the Licensee or its Affiliates used in connection with this Agreement (“Compliance Audit”). To theextent that any Compliance Audit by or on behalf of VBL requires access and review of any commercially or strategically sensitive information of theLicensee or its Affiliates relating to the business of the Licensee or its Affiliates, such activity shall be carried out by a Third Party professional advisorappointed by VBL and such professional advisor shall only report back to VBL such information as is directly relevant to informing VBL on the Licensee’scompliance with the particular provisions of this Agreement being Compliance Audited (and shall enter into a commercially reasonable confidentialityagreement consistent with the foregoing). The costs and fees of any such Compliance Audit shall be paid by VBL, except that, if a Compliance Auditreveals any material breach by Licensee of Section 6.5 as documented by such Third Party professional advisor, such costs and fees shall be paid byLicensee. Licensee shall bear its own costs of rendering assistance to the Compliance Audit. The audit rights described in this Section 6.6 are withoutlimitation of other audit rights described elsewhere in this Agreement. 35CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.7 Provisions applicable to Sales Representatives and/or Medical Science Liaisons. 6.7.1 General. Licensee shall, and shall cause its Sales Representatives to, conduct all details with respect to the Product and perform itsother Commercialization activities under this Agreement in the Territory in adherence with Applicable Laws and Regulatory Approvals. 6.7.2 Compensation. Licensee shall be solely responsible for (i) any compensation that is payable to its Sales Representatives (includingwith respect to any employee benefit plan), (ii) the payment or withholding of any contributions, payroll taxes, or any other payroll-related item by or onbehalf of Licensee (or its Affiliates) or any of its Sales Representatives or Medical Science Liaisons, and (iii) any failure of Licensee (or its Affiliates) towithhold or pay required taxes or failure to file required forms with regard to compensation and benefits paid or extended by Licensee (or its Affiliates) to anyof its Sales Representatives or Medical Science Liaisons. 6.7.3 Training. Licensee shall be solely responsible for training, and all costs associated with such training, its Sales Representatives andMedical Science Liaisons using Commercially Reasonable Efforts and in all cases in accordance with Applicable Laws, including timely reporting of anyadverse events with respect to the Product. Such training will include, among other topics, PMDA requirements and other national and local regulations andindustry guidelines, including those set forth in Section 6.5.1 above. 6.7.4 Acts of Sales Representatives and Medical Science Liaisons. For the avoidance of doubt, Licensee shall be solely responsible for anyact or omission of its Sales Representatives and Medical Science Liaisons while interacting with healthcare professionals or performing anyCommercialization activities (including any proceedings or claims for benefits that any Sales Representative or Medical Science Liaison may make under orwith respect to any VBL benefit plan). Licensee shall be solely responsible and liable for all probationary and termination actions taken by it with respect toits Sales Representatives and Medical Science Liaisons, as well as for the formulation, content and dissemination (including content) of all employmentpolicies and rules (including written compliance policies, and probationary and termination policies) applicable to its employees and contractors. Licenseeshall ensure that its policies require a clear delineation between the promotional and medical activities, including training both its Sales Representatives andMedical Science Liaisons on the differentiation of their roles under Applicable Laws. For clarity, Sales Representatives shall not engage in medical affairsactivities (including receiving, approving or delivering grants) nor will they attend formulary committee meetings and no Medical Science Liaison shallserve as a Sales Representative. 36CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.8 Promotional Materials. 6.8.1 Creation of Promotional Materials. Licensee will create and develop Promotional Materials for the Territory in accordance with theRegulatory Approvals and Applicable Laws and at Licensee’s sole cost and expense, in each case taking into consideration (to the extent consistent withsuch Regulatory Approvals and Applicable Laws) promotional materials used by VBL in the U.S. (copies of which shall be provided by VBL to Licensee atLicensee’s reasonable request). Prior to the First Commercial Sale of the Product, Licensee shall provide samples thereof to VBL in English for its informationprior to distributing such Promotional Materials (for clarity, such samples need only be submitted for each different type of Promotional Material, as opposedto each item of Promotional Material needing to be submitted). Any new samples of Promotional Material for the Territory made thereafter will be providedto VBL for its information prior to being distributed. To the extent Licensee includes any VBL trademarks in the Promotional Materials for the Territory,Licensee shall comply with VBL’s then current guidelines for trademark usage that are provided by VBL. 6.8.2 Inclusion of Logos on Packaging and Promotional Materials. To the extent permitted or required by Applicable Laws and subject toobtaining necessary Regulatory Authority approvals, with respect to Product to be sold by or on behalf of Licensee (or any of its Affiliates) in the Territory,the VBL trademark and the Licensee trademark shall be given equal prominence on all package inserts utilized by Licensee. Subject to the terms set forthherein, VBL hereby grants to Licensee a non-exclusive, royalty-free right and license during the Term to utilize the VBL trademark (including all trademarks,names and logos) in order to perform the Commercialization activities required to be performed by Licensee hereunder in accordance with the terms of thisAgreement, and Licensee hereby grants to VBL a non-exclusive, royalty free right and license during the Term to utilize the Licensee trademark (includingall trademarks, names and logos) in order to perform the Manufacturing and other activities to be performed by or on behalf of VBL under the terms of thisAgreement. Each Party shall only use the trademark of the other Party with the necessary trademark designations, and each Party shall use the other Party’strademarks in compliance with the then-current guidelines for trademark usage that are provided by the other Party and in a manner that does not derogatefrom such Party’s rights in its trademarks, names and logos. Each Party shall submit representative samples of its use of the other Party’s trademark for reviewby the JCSC. Each Party will take no action that will interfere with or diminish the other’s rights in its respective trademarks, names and logos, and if a Partyreasonably believes that the use of its trademarks, names and logos by the other Party hereunder is interfering with or diminishing its rights, such Party shallnotify the other Party thereof in writing and such other Party shall promptly cease use of such trademarks, names or logos in such manner. Each Party agreesthat all use of the other Party’s trademarks, names and logos will inure to the benefit of such other Party, including all goodwill in connection therewith. 37CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.8.3 Licensee Ownership of Promotional Materials. Subject to ARTICLE 14, Licensee shall own all right, title and interest in and to anyPromotional Materials created by Licensee hereunder relating to the Product in the Field in the Territory including copyrights, but excluding trademarks(including the Product Trademark), names, logos and other marks owned by or on behalf of VBL or its Affiliates. 6.8.4 Use of Promotional Materials Exclusively for the Product. The Promotional Materials, and any aspects of those uniquely tied to theProduct, shall be used by Licensee (and its Affiliates, Sublicensees, subcontractors, wholesalers and distributors) in connection with the Commercialization ofthe Product in the Field in the Territory in accordance with the terms of this Agreement, and Licensee shall not use, or allow any other Person to use, any suchPromotional Materials except in accordance with this Agreement. 6.9 Product Trademarks and Product Trade Dress. 6.9.1 Product Trademark. Licensee shall Commercialize the Product in the Field in the Territory under such trademark (and logo) as may bedetermined by Licensee after consultation with VBL (together, the “Product Trademark” and the “Product Trade Dress”, respectively). For clarity, theParties acknowledge and agree that it is their mutual intention that Licensee Commercialize the Product in the Field in the Territory under the ProductTrademark and the Product Trade Dress. Licensee shall bear all costs relating to the creation, legal clearance, filing, registration, and maintenance of anyalternative trademark and trade dress. Licensee shall not employ any such alternative trademarks or trade dress without providing prior notice to VBL. 6.9.2 Use and Ownership of Product Trademarks and Product Trade Dress. All uses of the Product Trademark and Product Trade Dress byLicensee (and its Affiliates, Sublicensees, subcontractors, wholesalers and distributors) to identify and/or in connection with the Commercialization of theProduct in the Field in the Territory shall be in accordance with Regulatory Approvals and all Applicable Laws, as may be amended from time to time.Licensee (and its Affiliates) shall only use the Product Trademark and Product Trade Dress pursuant to the terms of this Agreement to identify, and inconnection with the Commercialization of, the Product in the Territory for use in the Field. Licensee shall not (and shall cause its Affiliates, Sublicensees,subcontractors, wholesalers and distributors not to) use such Product Trademark or Product Trade Dress to identify, or in connection with the marketing of,any other products. VBL shall own and retain all rights to the Product Trademark and Product Trade Dress (in each case, together with all goodwill associatedtherewith throughout the Territory), and Licensee shall assign (and shall cause its Affiliates, Sublicensees, subcontractors, wholesalers and distributors toassign), and hereby does assign, to VBL, all of its and their right, title and interest in and to such Product Trademark and Product Trade Dress. If Licenseefiled and registered any such Product Trademark or Product Trade Dress at the request of VBL, then VBL shall reimburse all reasonable costs relating to thefiling, registration, and maintenance of such Product Trademark or Product Trade Dress within forty-five (45) days of receipt of an invoice therefor. VBL shallalso own rights to any Internet domain names incorporating the Product Trademark or any variation or part of the Product Trademark as its URL address orany part of such address. Licensee shall not establish any Internet domain name or URL incorporating the Product Trademark without the prior writtenconsent of VBL. 38CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.9.3 Maintenance of Product Trademark. During the Term, VBL shall (i) use Commercially Reasonable Efforts to establish, register andenforce the Product Trademark and Product Trade Dress in the Territory, (ii) maintain the Product Trademark and Product Trade Dress in the Territory and (iii)bear all costs and expenses relating to the foregoing. 6.9.4 Infringement of the Product Trademark. In the event that either Party becomes aware of any infringement of the Product Trademark orProduct Trade Dress by a Third Party in the Territory, such Party shall promptly notify the other Party and the Parties shall consult with each other in goodfaith with respect thereto. Licensee shall, at its sole discretion, have the first right to determine how to proceed with respect to such infringement, includingby the institution of legal proceedings against such Third Party, in which case all costs and awards relating to such legal proceedings will be borneexclusively by Licensee. If requested to do so, VBL shall reasonably cooperate with any and all action initiated by Licensee, including by joining legalproceedings as a party at Licensee’s reasonable expense. If Licensee elects not to take action or initiate legal proceedings against an instance of infringementto the Product Trademark or Product Trade Dress in the Territory, VBL shall have the right at its own and sole discretion to take action or initiate legalproceedings against such instance of infringement to the Product Trademark or Product Trade Dress in the Territory, in which case all costs and awardsrelating to such legal proceeding will be borne exclusively by VBL. If requested to do so, Licensee shall reasonably cooperate with any and all actioninitiated by VBL in connection therewith, including, by joining legal proceedings as a party at VBL’s reasonable expense. 6.9.5 Trademark Acknowledgments. Each Party acknowledges the sole ownership by the other Party and validity of all copyright,trademarks, trade dress, logos and slogans owned by the other Party and used or intended to be used in connection with the Commercialization of the Productfor the Field in the Territory. Each Party agrees that it will not at any time during or after the Term assert or claim any interest in, or knowingly do anythingwhich may materially and adversely affect the validity or enforceability of, any copyright, trademark, trade dress, logo or slogan owned by the other Partyand used or intended to be used on or in connection with the marketing or sale of the Product. Neither Party will register, seek to register or cause to beregistered any copyrights, trademarks, trade dress, logos or slogans owned by the other Party and used or intended to be used on or in connection with themarketing or sale of the Product or any variation thereof, under any Applicable Laws providing for registration of copyrights, trademarks, service marks, tradenames or fictitious names (including as an Internet domain name) or similar Applicable Laws, without the other Party’s prior written consent (in its solediscretion). 6.10 Global Branding Strategy. VBL shall have the right, from time to time during the Term, to implement (and thereafter modify and update) aglobal branding strategy, including global messaging, for the Product for use in the Field throughout the world (the “Global Branding Strategy”). To theextent VBL determines to utilize such Global Branding Strategy, Licensee shall use Commercially Reasonable Efforts to adhere to the Global BrandingStrategy in its Commercialization of the Product, including with respect to any Promotional Materials; provided, that, in the event that Licensee believes thatthe application of the Global Branding Strategy in the Territory would be inappropriate whether because of linguistic or cultural particularities, because it isagainst the Applicable Laws of the Territory or because Licensee reasonably determines it would be inconsistent with Licensee’s obligation to useCommercially Reasonable Efforts to Commercialize the Product in the Territory, Licensee shall present such concern to VBL, and the Parties shall discusswhether appropriate revisions to the Global Branding Strategy may make it appropriate for use in the Territory. Nothing in this Section 6.10 shall beconstrued to derogate from Licensee’s ultimate right and responsibility to use Commercially Reasonable Efforts to Commercialize the Product in theTerritory in accordance with the terms and conditions of this Agreement. 39CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.11 Commercialization Data. Licensee shall own all marketing and sales data and information resulting from its Commercialization of theProduct in the Field in the Territory (the “Commercialization Data”). Upon request from VBL, Licensee shall provide to VBL a copy of theCommercialization Data, including promotional materials, marketing strategies, market research data and customer lists. VBL shall have the right and licenseto use all such Commercialization Data (and the right to grant its Affiliates and Third Parties the right to use such Commercialization Data) in connectionwith its commercialization of the Product in the Field outside the Territory, which right and license shall survive the expiration or termination of thisAgreement. Notwithstanding the foregoing, Licensee’s obligation to provide Commercialization Data and VBL’s right to use such data shall be performed, orexercised, respectively, in all instances in accordance with all Applicable Laws, including, without limiting the foregoing, any data privacy laws. ARTICLE 7SUPPLY 7.1 VBL Supply Obligations. 7.1.1 General. VBL shall use best efforts to Manufacture (or have Manufactured) and supply all quantities of the Finished Product dulyforecasted and ordered by Licensee pursuant to this ARTICLE 7 for clinical and commercial use in the Field in the Territory, in each case in accordance withthe terms of this ARTICLE 7 and the Quality Agreement. 7.1.2 Development Supply. VBL shall use best efforts to Manufacture, or arrange for a Third Party to Manufacture, and supply all ofLicensee’s requirements of the Finished Product for Territory Development Activities to be performed by it in accordance with the Development Plan, whichsupply shall be in accordance with the terms of this ARTICLE 7 and the applicable Quality Agreement. The Finished Product shall be ordered and suppliedfor Territory Development Activities in accordance with the procedures set forth in this ARTICLE 7; provided, that VBL shall have no obligation to supplyFinished Product hereunder unless and until the Parties have executed the Quality Agreement in accordance with Section 7.7.1. 7.1.3 Commercial Supply. VBL shall use best efforts to Manufacture, or arrange for a Third Party to Manufacture, and supply all ofLicensee’s requirements of the Finished Product for commercial sale in the Field in the Territory pursuant to this Agreement, which supply shall be inaccordance with the terms of this ARTICLE 7 and the applicable Quality Agreement. 7.1.4 Secondary Supply. VBL shall use Commercially Reasonable Efforts to establish, at its own cost and expense, a second source ofsupply for the Finished Product at a facility that is separate from VBL’s Facility at Modiin, Israel, which may be an additional VBL manufacturing site or aThird Party, and which is capable of Manufacturing the Finished Product pursuant to the specifications and requirements set forth in this Agreement and theQuality Agreements (“Secondary Source”). In the event that VBL is unable to fulfill Licensee’s requirements for the Finished Product through VBL’s ownManufacturing capacity, VBL shall engage the Secondary Source to Manufacture the Finished Product to fulfill Licensee’s requirements thereof. 40CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.2 Exclusivity. Subject to the provisions of this Agreement and the Quality Agreement, and VBL’s supply of sufficient and non-DefectiveFinished Products, Licensee shall, and shall cause its Affiliates and Sublicensees (as applicable) to, purchase all of its and their respective requirements of theProduct exclusively from VBL (except as set forth in Section 7.10), and VBL shall, and shall cause its Affiliates and Manufacturing subcontractors (asapplicable) to, supply the Product for sale in the Field in the Territory exclusively to Licensee pursuant to the terms of this ARTICLE 7 and VBL shall not,and shall not permit its Affiliates and sublicensees to, directly or indirectly (i) sell the Product in the Field in the Territory, (ii) supply the Product to anyThird Party in the Field in the Territory or (iii) supply the Product to any Third Party outside the Territory that VBL knows intends to resell the Product in theField in the Territory. 7.3 Packaging and Labeling; Certain Other Manufacturing Activities. 7.3.1 Finished Product. Notwithstanding anything to the contrary contained herein, in accordance with the procedures set forth in theQuality Agreement, with respect to the supply of Finished Product, VBL or its designated Third Party shall be responsible (at its sole cost and expense, whichshall be included in the Cost of Goods and Supply Price) for all final product labeling and packaging (whether in commercial or clinical packagingpresentation, and, if not already qualified by VBL’s existing stability program, including a new stability program, which shall be included in Cost of Goodsand Supply Price), including insertion of materials such as patient inserts, patient medication guides, professional inserts and any other written, printed orgraphic materials accompanying the Product, considered to be part of the Finished Product, and handling, storage, quality control, quality assurance, andrelease testing and related activities, of the Finished Product in connection with the foregoing (collectively, “Packaging and Labeling”). With respect to thesupply of Finished Product, VBL or its designated Third Party shall ensure that all such Packaging and Labeling shall comply with Applicable Laws, GMPsand the Regulatory Approvals for the Product in the Territory, including the Product Specifications; provided, that Licensee shall be responsible forcompliance with Applicable Laws, GMPs and the Regulatory Approvals with respect to approved and camera-ready artwork for such Packaging and Labelingand all other printed components and materials, which camera-ready artwork Licensee shall prepare and deliver to VBL (in electronic files in a nativeelectronic format) at least ninety (90) days prior to issuing a firm Purchase Order. 7.3.2 General. VBL or its designated Third Party shall also be responsible for performing any required testing and release testing of theFinished Product and Licensee shall provide reasonable assistance to VBL in connection therewith, all as more particularly set forth in the QualityAgreement; provided that if any release testing procedure or procedures are required for the Territory but not for generally for markets outside the Territory,the Licensee shall bear the cost and expense of such specific procedure or procedures. 41CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.4 Forecasting and Ordering. 7.4.1 Forecast. Licensee shall furnish the first forecast under this Section 7.4 no less than [***] before the anticipated commencement ofTerritory Development Activities or Commercialization activities that will require Finished Product, as applicable (the “Initial Forecast Date”). On theInitial Forecast Date and on the first day of each calendar month thereafter (each a “Forecast Date”), Licensee shall furnish VBL a forecast of quantities ofFinished Product that Licensee expects to be delivered on a monthly basis in the [***] beginning one (1) Calendar Quarter after the Forecast Date (each a“Forecast”), with the months included in the first Calendar Quarter of each Forecast being binding, the months included in the second Calendar Quarter ofeach Forecast being permitted to vary in subsequent Forecasts by up to [***], the months included in the third Calendar Quarter of each Forecast beingpermitted to vary in subsequent Forecasts by up to [***], and the remainder of each Forecast being a good faith estimate for informational and planningpurposes. If Licensee wishes to increase supply quantities at any time in excess of the volumes permitted under this Section 7.4.1, upon Licensee’s request,the Parties shall discuss such increase in good faith and VBL shall use Commercially Reasonable Efforts to supply any such increase in volumes. If Licenseewishes to make a firm, binding order for the Product, it must provide VBL with a Purchase Order for the Product at least one (1) Calendar Quarter prior to therequested delivery date. All Forecasts shall (i) be specified for Finished Product on a monthly basis and (ii) be for units of full packages of Finished Product.In the event that the foregoing Forecasts change over time based on commercial or regulatory developments or other factors, the Parties shall meet to discussin good faith (through the applicable Committees) the reasonable ability of VBL to accommodate any such change, a plan of action for accommodating suchchange, and an equitable allocation between the Parties of any resulting costs and expenses. 7.4.2 Long Range Capacity Planning; Supply Chain Improvements. Concurrent with the Initial Forecast, for the purposes of discussion andplanning of manufacturing capacity Licensee shall provide a non-binding forecast of Finished Product needs for the [***] following that specified in the thencurrent Forecast as described in Section 7.4.1 (“Long Range Forecast”). In the event VBL projects a shortfall in capacity based on the Long Range Forecast,the Parties will jointly discuss alternatives to increase such capacity, and the Parties shall promptly meet to discuss a reasonable manner of proceeding.Unless otherwise agreed to by the Parties during the Term, the Long Range Forecast shall be updated by Licensee and reviewed with VBL on an annual basis. 7.4.3 Orders. On each Forecast Date, in addition to the Forecast specified in Section 7.4.1, Licensee shall for the Term deliver to VBL a firmpurchase order or orders specifying the quantities of the Finished Product for delivery on a monthly basis in the Calendar Quarter beginning one (1) CalendarQuarter after the Forecast Date, as well as the location of delivery and desired delivery date for each delivery (each a “Purchase Order”). Each such PurchaseOrder shall provide for aggregate quantities for delivery in such Calendar Quarter as set forth in the Forecast for such Calendar Quarter given one (1) CalendarQuarter earlier than the Forecast Date on which such Purchase Order is placed; provided, however, that, to the extent a Purchase Order sets forth quantitiesthat are no less than [***], and no more than [***], of the quantities contained in such Forecast, then VBL will use Commercially Reasonable Efforts toaccommodate such amounts and accept such Purchase Orders. Unless agreed separately between the Parties, each Purchase Order shall specify no more thanone (1) delivery date for the Finished Product in each calendar month. 42CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.4.4 Receipt and Acceptance. Subject to the terms and conditions of this Agreement, VBL shall use best efforts to supply, and Licenseeshall purchase, all Finished Product ordered and specified in a Purchase Order. Purchase Orders may be delivered electronically or by other means to suchlocation as VBL shall designate and shall be in a form reasonably acceptable to VBL. VBL shall provide written confirmation of such Purchase Order toLicensee within ten (10) Business Days of receipt of such Purchase Order (the date of such written confirmation, the “Purchase Order Acceptance Date”). IfVBL fails to provide the written confirmation of such Purchase Order in a timely manner, such Purchase Order shall be deemed to have been duly accepted byVBL and become legally binding upon the Parties on the tenth (10th) Business Day after receipt by VBL. VBL shall accept any Purchase Order for FinishedProduct that does not exceed the applicable maximum provided for in the most recent Forecast. If a Purchase Order, whether or not accepted, exceeds suchapplicable maximum, the Parties shall seek to agree on a reasonable manner of proceeding. VBL shall use Commercially Reasonable Efforts to supply anyamount of Finished Product that Licensee orders pursuant to Section 7.4.3 in excess of the maximum amount deliverable under the ordering and forecastingprocedures specified herein, but, in any event, such efforts shall not be construed as an obligation hereunder and in no event shall VBL be deemed in breachof this Agreement by means of a failure to provide Finished Product in excess of the Forecasted amount. Nothing in any such Purchase Order or writtenacceptance shall supersede the terms and conditions of this Agreement or the Quality Agreement, and in the event of a conflict between the terms suchPurchase Order (or written acceptance, as applicable) and the terms of this Agreement (or the Quality Agreement, as applicable), the terms of this Agreement(or the Quality Agreement, as applicable) shall control. All Purchase Orders, written acceptances of Purchase Orders and other notices contemplated under thisSection 7.4 shall be sent to the attention of such persons as each Party may identify to the other in writing from time to time in accordance with Section 16.3.In addition, (i) VBL shall not be liable for any delays related to changes or other matters applicable to any camera-ready artwork or other materials orinformation provided by Licensee, and (ii) the Parties acknowledge that delivery times for clinical quantities may vary. 7.5 Supply Price and Invoicing. (a) Prior to Establishment of the NHI Price. Prior to final approval of the NHI price for the Product in the Territory, the Finished Productsupplied for Development or Commercialization in the Territory shall be invoiced at [***]. (b) After Establishment of the NHI Price. After final approval of the NHI price for the Product in the Territory, the Finished Productsupplied for Development or Commercialization in the Territory shall be invoiced per dose at the lesser of (i) [***] of the then-current NHI price or (ii) [***].Notwithstanding the foregoing, if [***] of the NHI price is less than VBL’s Cost of Goods plus [***], then the Supply Price shall be VBL’s Cost of Goodsplus [***], but in no case shall the Supply Price be greater than [***]. VBL shall use Commercially Reasonable Efforts to decrease its Cost of Goods to [***]by the [***] anniversary of the First Commercial Sale of the Product in the Territory. 43CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (c) “Cost of Goods” means, for Finished Product manufactured by VBL or a Third Party, VBL’s actual costs of manufacturing, packaging,and testing such Product and amounts paid to a Third Party, calculated in accordance with the Accounting Standards, consisting of: (a) the costs andexpenses associated with components, such as raw materials, drugs and chemicals, encapsulation, labeling and packaging materials and components, (b) anyapplicable net sales taxes, VAT, customs duties and similar import fees or costs and freight actually paid by VBL, (c) direct production labor, (d) Third Partylogistics fees and pass-through expenses, and (e) fairly allocated manufacturing overhead. In the event that pursuant to paragraph (b) above, the Supply Pricehas been set by reference to VBL’s Cost of Goods, then Licensee shall have the right to audit the calculation of VBL’s Cost of Goods. Such audit shall becarried out in the same manner as the audit provisions of Section 8.11 which shall apply mutatis mutandis to both Parties to facilitate such right of audit. 7.5.2 Invoice. Each delivery of Finished Product hereunder shall be accompanied by an invoice setting forth the Supply Price for suchshipment. Licensee will make payment against each invoice, within the earlier of (a) thirty (30) days after obtaining the affirmative drug testing report at thedestination port for the Product covered by a given invoice (provided, that Licensee shall deliver a copy of such drug testing report in English to VBL withinsuch thirty (30) day time period) or (b) sixty (60) days after the Product arrives at the destination port. 7.6 Shipping and Delivery. 7.6.1 Delivery. Subject to the terms and conditions of this Agreement, VBL shall ship (or have shipped) to Licensee in accordance with thisSection 7.6 the quantity of the Finished Product specified in each accepted Purchase Order within ninety (90) days from the Purchase Order Acceptance Dateor otherwise as agreed to by the Parties. Notwithstanding anything to the contrary contained herein, (i) VBL will notify Licensee of the anticipated FCA(Incoterms 2010) (VBL’s or its designee’s site) date of shipment at least five (5) days prior to such FCA (Incoterms 2010) (an international airport close toVBL’s or its designee’s site as agreed by the Parties) date, which FCA (Incoterms 2010) (VBL’s or its designee’s site) date may occur as many as seven (7)days prior to the date that is ninety (90) days from the Purchase Order Acceptance Date, and such shipment shall be deemed to have been shipped on a timelybasis hereunder, and (ii) in order to allow for Finished Product Manufacturing variances, VBL shall be entitled to ship quantities of Finished Product as muchas five percent (5%) above or below the amount of the Finished Product specified by Licensee in the applicable Purchase Order, and such shipment shall bedeemed to have been shipped in satisfaction of VBL’s obligations hereunder. Licensee shall purchase all such Finished Product so shipped. The FinishedProduct delivered by VBL or its designee shall have at least the greater of (a) one and one half years of remaining shelf life or (b) remaining shelf life equal toat least fifty percent (50%) of its total shelf life, upon arrival at the destination port in the Territory, subject to delays caused by customs and otherGovernmental Authorities. 7.6.2 Shipment Terms. Finished Product shall be supplied to Licensee FCA (Incoterms 2010) (an international airport close to VBL’s or itsdesignee’s site as agreed by the Parties). Delivery shall occur, and title and risk of loss will pass to Licensee, when the Product is shipped to Licensee’s carrier.Finished Product shall be shipped at Licensee’s expense via a carrier identified by Licensee in the applicable Purchase Order; provided, that (i) such carriershall be one that can transport and maintain such Finished Product in accordance with Product Specifications as per Product storage requirements), and (ii) inthe event that Licensee fails to identify a carrier, VBL may choose a carrier at its own reasonable discretion, at Licensee’s expense. 44CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.6.3 Retention. Unless the Parties agree otherwise, VBL will maintain or cause to be maintained analytical samples of each Finished Productin storage for a time period based upon VBL’s sample retention policy. 7.7 Quality and Compliance. 7.7.1 Quality Agreements. The Quality Agreements will set forth the Parties’ quality and compliance obligations with respect toManufacture of the Finished Product. VBL’s quality and compliance obligations and warranties with respect to Manufacture of the Finished Product set forthin such Quality Agreements shall be at least as favorable to Licensee as are the quality and compliance obligations and warranties that VBL receives pursuantto the quality agreement(s) that VBL enters into with its suppliers and other manufacturers of the Product. In cases where Licensee is required to enter intoquality agreement(s) directly with local suppliers in the Territory for raw materials used in the Manufacture of the Finished Product, Licensee shall have theright and authority to enter into such quality agreement(s), and VBL shall comply with the terms set forth therein in Manufacturing the Finished Product.Licensee and VBL agree to comply with the requirements and provisions set forth in the Quality Agreements. The Quality Agreements will set forth in greaterdetail many of the responsibilities and obligations set forth herein. In the event of a conflict between the terms of the Quality Agreements and the terms ofthis Agreement, the terms of this Agreement shall prevail. The Parties shall execute the Quality Agreements within ninety (90) days of the Effective Date, orsuch other time-frame as otherwise agreed between the Parties. 7.7.2 Notice of Non-Conformance. (a) VBL shall supply to Licensee the applicable batch number for the Finished Product delivered as well as such other information as theParties may set forth in the Quality Agreement with respect to the Manufacture of the Product for all Finished Product shipped to Licensee hereunder.Licensee shall promptly on receipt of each shipment of Finished Product hereunder inspect, or cause to have inspected, each shipment of such Product for anydamage, Defect (as defined below) or shortage, and cause to be tested by the qualified drug testing institution at the destination port in the Territory of eachshipment of such Product for any quality issues, within a reasonable period of time and give VBL written notice of any such damaged, defective or shortshipment or any shipment of such Product with quality issues (a “Notice of Non-Conformance”). All testing shall be conducted in accordance with theProduct Specifications and the Quality Agreement. “Defect” and “Defective” refer to Finished Product that fails to meet any of the representations andwarranties set forth in Section 10.2(g) as of the date of delivery, including for clarity, any Latent Defect (defined below). (b) Latent Defects shall be communicated to VBL, together with appropriate detail, via a Notice of Non-Conformance, without undue delayafter such Latent Defect is first discovered by Licensee (or Licensee otherwise is notified of such Latent Defect), but in all cases within fifteen (15) days of thedate on which such Latent Defect was first discovered by Licensee or was notified to Licensee by the relevant Person discovering the defect, and thereaftersuch Latent Defect shall be handled as set forth in the remainder of this Section 7.9 and/or the Quality Agreement, as applicable. For purposes of this Section7.7.2(b), “Latent Defects” shall mean those defects that could not be discovered by inspection or testing by Licensee or its designee as described in Section7.7.2(a). Notwithstanding the foregoing, Licensee must submit a Notice of Non-Conformance, if at all, with respect to Finished Product no later than six (6)months from the date of delivery of such Finished Product. 45CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.7.3 Notification of Significant Quality Issues. As set forth in the Quality Agreements, the Parties shall notify each other of the occurrenceof a confirmed out-of-specification or out-of-trend (“OOS”) or out-of-trend (“OOT”) result or major process deviation relating to the Product in the Territory.The Parties agree to consult on all quality decisions regarding any OOS or OOT result or major process deviations involving the Product, and/or FinishedProduct that is intended for the Territory. 7.7.4 Audits. Licensee shall have access to VBL’s or its Third Party manufacturer’s Facilities associated with the Product or Finished Productat a mutually agreeable time for the sole purpose of auditing the Facilities for operational compliance with cGMP and GMP by any Regulatory Authority inthe Territory. The right to audit also includes any testing Facility related to the Product or Finished Product; provided, that, to the extent a Third Party’sFacilities are the subject of an audit pursuant to this Section 7.7.4, Licensee shall (a) perform such audit in conjunction with VBL (and any other licensees ofVBL desiring to so audit), (b) bear any costs charged by such Third Party associated with such audit, and (c) abide by any applicable terms and conditionsregarding such audit as VBL’s agreement with such Third Party may provide (including any limitations on the number of such audits as may be conducted ina given a time-frame). For clarity, VBL shall have the right to accompany Licensee on any such audit of a Third Party’s Facility. The audit rights described inthis Section 7.7.4 are without limitation of other audit rights described elsewhere in this Agreement. The audit rights described herein may be exercised byLicensee only one time each Calendar Year. Notwithstanding anything in this Section 7.7.4 to the contrary, Licensee shall only have the right to audit aThird Party to the extent that VBL has such right and such Third Party consents to Licensee accompanying VBL on such audit. 7.8 Disputes and Remedies. 7.8.1 Disputes. If Licensee timely delivers a Notice of Non-Conformance in respect of all or any part of a shipment of the Finished Productand VBL does not agree with Licensee’s determination that the Finished Product fails to meet the Product Specifications (or there is a short shipment), theParties shall in good faith attempt to resolve such dispute. VBL and Licensee shall have thirty (30) days, unless otherwise agreed in writing by the Parties,from the date of VBL’s receipt of a Notice of Non-Conformance to resolve such dispute regarding whether all or any part of such shipment of FinishedProduct was Manufactured in conformance with the Product Specifications (or there is otherwise a short shipment). In the event of such a dispute, Licenseeshall retain samples of such Finished Product and make such samples available to VBL at VBL’s reasonable request. If the dispute regarding whether all orany part of a shipment of Finished Product rejected by Licensee was Manufactured in conformance with the Product Specifications (or there is a shortshipment) is not resolved in such thirty (30) day period, then the Parties shall submit the samples of such Finished Product to an agreed-upon drug testinginstitution for re-testing. The results of the drug testing qualified institution’s re-testing shall be final and binding on the Parties, and if such Finished Productis determined to meet the Product Specifications (or is otherwise determined not to be a short shipment, as applicable), then Licensee shall pay for the costs ofsuch drug re-testing; otherwise VBL shall pay for such costs. 46CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.8.2 Remedies. In the event any shipment of Finished Product is timely rejected pursuant to Section 7.7.2 as a result of such FinishedProduct being Defective (including for being Latently Defective) or a short shipment, as applicable, then (i) Licensee shall, at the direction of VBL, either (a)destroy such rejected Finished Product at VBL’s reasonable expense (in accordance with Applicable Laws) or (b) return such Finished Product to VBL, at alocation designated by VBL and at VBL’s reasonable expense, and (ii) VBL, at no expense to Licensee, shall (in VBL’s sole discretion) either (a) use its bestefforts to replace such non-conforming Finished Product or short shipment, or (b) give Licensee a credit in an amount equal to the amount paid or payable byLicensee with respect to such rejected Finished Product or short shipment. In the event that any shipment of Finished Product is not timely rejected or isrejected for any reason other than being Defective, subject to Sections 7.10 and 11.1, VBL shall have no liability to Licensee in connection therewith, andLicensee shall, at its sole cost, destroy such rejected Finished Product in compliance with Applicable Laws. SUBJECT TO SECTION 11.1, VBL’s LIABILITYIN RESPECT OF ANY REJECTION (INCLUDING ANY SHORT SHIPMENT) SHALL BE LIMITED TO THE REMEDIES PROVIDED IN THIS SECTION7.8.2 AND SECTION 7.10. For clarity, a shipment of Finished Product that is a short shipment shall not be subject to return by Licensee, but all remedies(other than for such short shipment itself) set forth in this Section 7.8.2 and Section 7.10 shall apply to the Finished Products delivered under such shortshipment. 7.9 Shortages. In the event that VBL anticipates the materials and/or Manufacturing capacity of VBL or its Third Party manufacturer required toManufacture and deliver the Finished Product to Licensee is to be in short supply, VBL shall promptly notify Licensee of such shortage and the Parties shallpromptly meet to discuss the shortage. VBL shall provide a written plan of action stating in reasonable detail the identifiable cause of the shortage andproposed measures to remedy the shortage and the date such shortage is expected to end. Within thirty (30) days after the occurrence of any shortage event,VBL shall allocate its inventory of the Product, if any, among Licensee and VBL, and its Affiliates, licensees and/or business partners for the Product world-wide, on a pro-rata basis, based upon market share and order volumes for the prior twelve (12) month period until the Purchase Orders from Licensee can beadequately fulfilled. Upon the occurrence of a shortage event as described above, VBL shall, for the limited purpose of complying with its inventoryallocation obligations set forth above, provide Licensee with reports setting forth its annual world-wide sales of the Product within 60 (sixty) days after theend of each Calendar Year. VBL shall use its Commercially Reasonable Efforts to minimize the duration of any shortage. Licensee shall maintain reasonablesafety stock of Finished Product based on the fifty percent (50%) binding portion of the subsequent Calendar Quarter of the most recent Forecast. 7.10 Major Supply Failure. In addition to the remedies set forth in Section 7.11, in the event VBL materially and repeatedly fails to satisfy itssupply obligations under this Agreement, including by materially and repeatedly (a) delivering Defective Finished Products, (b) delivering short shipmentsof Finished Products, (c) failing to deliver Finished Products by the delivery dates set forth in the applicable Purchase Order, or (d) failing to remedy ashortage event set forth in Section 7.11 (“Major Supply Failure”), VBL hereby agrees that Licensee may manufacture or have manufactured through aThird Party, or purchase directly from VBL’s third-party supplier, Licensee’s requirements of Product. VBL shall provide all reasonable cooperation to assistLicensee in obtaining an alternative source of Product in the event of a Major Supply Failure upon Licensee’s request, including by introducing Licensee toits third-party supplier and conducting a technology transfer, provided that any such technology transfer will be subject to approval by the applicableRegulatory Authority in Israel. In connection therewith, VBL shall bear all cost and expenses incurred by Licensee for such arrangement or assistance, andthe Parties shall discuss in good faith and agree upon adjustments to the royalty and milestone payments set forth in ARTICLE 8 for the remainder of theTerm. 47CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.11 Product Specification and Manufacturing Changes. Neither Party shall make any Product Specification changes as it pertains to the Productto be supplied in the Field in the Territory without prior written consent of the other Party, such consent not to be unreasonably withheld. In the event of suchconsent, the Parties shall enter into a written supplemental agreement with respect to the division of responsibilities for obtaining Regulatory Approvals ofsuch changes and the cost to be assumed by each Party in connection therewith. VBL shall (a) notify Licensee in writing twelve (12) months before it (i)changes the Facility used to Manufacture the supply of the Product in the Field in the Territory and any Product Specification for the Product in the Field inthe Territory applicable to the Regulatory Materials filed with PMDA, or (ii) makes any changes within the Facility for the Product in the Field in theTerritory applicable to the Regulatory Materials filed with PMDA, and (b) not proceed with any such change until Licensee provides confirmation ofPMDA’s approval for such change. Each Party shall provide the other Party with all necessary documentation and information required for preparing theapplicable Regulatory Materials with PMDA; provided, that all applicable Regulatory Materials shall be prepared and filed by the Parties in accordance withthe provisions of ARTICLE 5 and each Party shall bear its respective costs and expenses incurred in connection therewith. Notwithstanding the foregoingand the forecasting and ordering provisions under Section 7.4, VBL shall use best efforts to ensure the sufficient supply of Product to Licensee during thetransitional period for the changes set forth in this Section 7.11. VBL and Licensee shall discuss means to ensure supply throughout this transition period,including VBL preparing and holding a safety stock of Product at its site to mitigate any supply shortages that may occur as a result of such changes. Forclarity, changes made with respect to the Facilities or other sites that are applicable to the supply of Product outside the Field or outside the Territory, orotherwise not applicable to the Regulatory Materials filed with PMDA with respect to the supply of the Product in the Field in the Territory, will not besubject to this Section 7.11. 7.12 Termination of Supply Obligations. Notwithstanding anything to the contrary contained herein, the obligations of VBL under thisARTICLE 7, including the obligations to Manufacture and supply Finished Product, to Licensee hereunder, and Licensee’s obligations to purchase solelyfrom VBL, shall continue during the Royalty Term and, subject to the agreement set forth below in this paragraph, shall continue after the end of the RoyaltyTerm, upon reasonable terms and conditions to be agreed between the Parties. In the event that Licensee desires to continue Commercializing the Product,and VBL is able to continue supplying the Product, following the expiration of the Royalty Term, the Parties shall, at least twelve (12) months before theexpiration of the Royalty Term, negotiate in good faith and execute a distinct manufacturing and supply agreement with the terms and conditions uponwhich VBL continues to Manufacture and supply, and Licensee continues to purchase, requirements of the Finished Product, as applicable, from VBL. 48CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 8PAYMENTS 8.1 Upfront Payment. In consideration of the right to Develop and Commercialize the Product in the Territory subject to the terms of thisAgreement, on the Effective Date, Licensee shall pay to VBL an upfront amount equal to fifteen million Dollars ($15,000,000) (the “Upfront Payment”) bywire transfer of immediately available funds into an account designated in writing by VBL. The Upfront Payment shall be nonrefundable and noncreditableagainst any other payments due hereunder. 8.2 Milestone Payments. In consideration of the right to Develop and Commercialize the Product in the Territory subject to the terms of thisAgreement, Licensee shall pay to VBL the milestone payments described in this Section 8.2 following achievement (first occurrence) during the RoyaltyTerm of the corresponding milestone event. A Party shall promptly notify the other Party in writing of, but in no event later than ten (10) days after, theachievement (first occurrence) of each such milestone event (each, a “Milestone Notification Notice”) achieved by it. Licensee shall pay the applicablemilestone payment relating to regulatory milestones by wire transfer of immediately available funds into an account designated by VBL within fifteen (15)Business Days after the date of the Milestone Notification Notice; provided, however, that in no event shall a failure to deliver a Milestone NotificationNotice relieve Licensee of its obligation to pay VBL the milestone payments described in this Section 8.2. Licensee shall pay milestone payments for sales-based milestones within 90 days after the end of the Calendar Year in which a sales-based milestone is achieved. If multiple sales milestones are achieved inthe same Calendar Year they will be paid at such time. Each such milestone payment shall be payable only once regardless of how many times the milestoneevent is achieved. Each such milestone payment is nonrefundable and noncreditable against any other payments due hereunder, except as set forth below.With respect to Sales Based Milestone Payments set forth below, Licensee may deduct, one time only with respect to each applicable deduction amount,any amount paid by Licensee to VBL under Section 8.3.2 below on Sublicense Income earned by Licensee from Sublicensees on account of theachievement of specified levels of sales of Product in the Territory, which deduction shall be applied to any subsequent Sales Based Milestone Payment tobe made by Licensee to VBL hereunder. With respect to Regulatory Milestone Payments set forth below, Licensee may deduct, one time only with respectto each applicable deduction amount, any amount paid by Licensee to VBL under Section 8.3.2 below on Sublicense Income earned by Licensee fromSublicensees on account of the achievement of a regulatory milestone in the Territory; provided that such deductions shall be on an indication-by-indication basis, so that Licensee may only deduct from a Regulatory Milestone Payment owed to VBL relating to a particular indication, SublicenseIncome Payments previously made to VBL on account of Sublicense Income earned by Licensee for the achievement of a regulatory milestone relating tothe same indication (including milestones for pre-commercialization activities, [***]). [***] [***][***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] By way of illustration of the above calculations: ●[***] ●[***] 49CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ●[***] 8.3 Royalty Payments; Sublicense Income. 8.3.1 Royalty Payments. As further consideration for the rights granted to Licensee under this Agreement, with respect to Net Sales duringthe Royalty Term, Licensee shall pay to VBL tiered payments (“Royalty Payments”) at the following rates [***] based on aggregate annual Net Sales ofProduct in the Territory for all or any portion of the Calendar Year falling within the Royalty Term for such Product: [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] 50CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. [***] 8.3.2 Sublicense Income. In addition to other amounts due under this Section 8.3, subject to Section 8.2, Licensee will pay VBL [***] of allSublicense Income received during a given Calendar Quarter (“Sublicense Income Payment”). 8.4 Royalty Stacking. In the event that Licensee owes a royalty for the Development or Commercialization (including sale) of the Products in theTerritory under any agreement with a third party (excluding any Affiliates or VBL) (a “Third Party License”), then [***] percent ([***]%) of such anyroyalty due under such Third Party License shall be creditable against any royalty to be paid by Licensee to VBL hereunder, provided that in no event shallany royalty to be paid hereunder be reduced by more than [***] percent ([***]%). For the avoidance of doubt, this Section 8.4 shall be in addition to, andshall not limit or disturb, any remedy that Licensee may have pursuant to a breach of any provision of this Agreement by VBL. 8.5 Royalty Reports and Payment Procedures. Licensee shall calculate all (i) Royalty Payments with respect to Net Sales, and (b) SublicenseIncome, payable to VBL pursuant to Section 8.3 at the end of each Calendar Quarter, which amounts shall be converted to Dollars at such time inaccordance with Section 8.7. Licensee shall provide a written estimate of Sublicense Income received and Net Sales during the just ended Calendar Quarterwithin five (5) days of the end of such Calendar Quarter. Thereafter, Licensee shall pay to VBL the Royalty Payment due for Net Sales, and SublicenseIncome Payment due for Sublicense Income, during a given Calendar Quarter within thirty (30) days following the end of such Calendar Quarter. EachRoyalty Payment and Sublicense Income Payment due to VBL shall be accompanied by (i) a statement of the amount of gross sales of the Product in theTerritory, and gross Sublicense Income received, during the applicable Calendar Quarter (such amounts expressed in local currency and in Dollars convertedat the relevant time in accordance with Section 8.6), (ii) an itemized calculation of Net Sales in the Territory, showing each deduction provided for in thedefinition of “Net Sales” during such Calendar Quarter, and (iii) a calculation of the amount of the Royalty Payment due on such Net Sales, and theSublicense Income Payment due on such Sublicense Income, for such Calendar Quarter. Without limiting the generality of the foregoing, Licensee shallrequire its Affiliates and Sublicensees (if any) to account for its Net Sales and to provide such reports with respect thereto as if such sales were made byLicensee. 8.6 Taxes and Withholding. 8.6.1 VAT. The Parties agree to cooperate with one another and use reasonable efforts to ensure that value added tax or similar payment(“VAT”) in respect of any payments made by Licensee to VBL under this Agreement does not represent an unnecessary cost in respect of payments madeunder this Agreement. For purposes of clarity, all sums payable under this Agreement shall be exclusive of VAT. In the event that any VAT is owing in anyjurisdiction in respect of any such payment, Licensee shall pay such VAT, and (i) if such VAT is owing as a result of any action by Licensee, including anyassignment or sublicense (including assignment to, or payment hereunder by, another Licensee-related entity or Affiliate), or any failure on the part ofLicensee or its Affiliates to comply with applicable tax laws or filing or record retention requirements, that has the effect of modifying the tax treatment of theParties hereto, then the payment in respect of which such VAT is owing shall be made without deduction for or on account of such VAT to ensure that VBLreceives a sum equal to the sum which it would have received had such VAT not been due or (ii) otherwise, such payment shall be made after deduction ofsuch VAT. For the sake of clarity, any increase in payments to VBL under this Section 8.5 shall reflect only the incremental increase in VAT directly resultingfrom clause (i) above. In the event that any VAT is owing in any jurisdiction in respect of any such payment, VBL will provide to Licensee tax invoicesshowing the correct amount of VAT in respect of such payments hereunder. 51CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 8.7 Withholding Tax. If Licensee is required to make a payment to VBL that is subject to withholding tax under the Applicable Laws, suchamounts shall be borne by Licensee, and not deducted from the payments otherwise due to VBL hereunder. 8.7.1 Tax Cooperation. To the extent Licensee is required to deduct and withhold taxes on any payments to VBL, Licensee shall pay theamounts of such taxes to the proper Governmental Authority in a timely manner and promptly transmit to VBL an official tax certificate or other evidence ofsuch withholding sufficient to enable VBL to claim such payments of taxes. VBL shall provide to Licensee any tax forms that may be reasonably necessary inorder for Licensee not to withhold tax or to withhold tax at a reduced rate under an applicable bilateral income tax treaty. VBL shall use reasonable efforts toprovide any such tax forms to Licensee at least thirty (30) days prior to the due date for any payments for which VBL desires that Licensee apply a reducedwithholding rate. Each Party shall provide the other with reasonable assistance to enable the recovery, as permitted by Applicable Laws, of withholdingtaxes, VAT, or similar obligations resulting from payments made under this Agreement, such recovery to be for the benefit of the Party bearing suchwithholding tax or VAT. 8.7.2 Indirect Tax. All payments to be made by Licensee to VBL pursuant to the terms of this Agreement are stated exclusive of IndirectTaxes. If any Indirect Taxes are chargeable in respect of such payments, Licensee shall pay such Indirect Taxes. 8.8 Currency Conversion. All payments hereunder shall be made in Dollars. For the purpose of calculating any sums due under, or otherwisereimbursable pursuant to, this Agreement (including the calculation of Net Sales expressed in currencies other than Dollars), any amount expressed in aforeign currency shall be converted into Dollars based on the applicable exchange rate quoted on “www.oanda.com” for the last day of the relevant CalendarQuarter or the date that a milestone is achieved. 8.9 General Payment Procedures. Unless otherwise expressly payable in certain time frames as provided in this Agreement (including Section7.5), the receiving Party shall invoice the paying Party for all amounts due to such receiving Party under this Agreement, and such payments shall be madewithin thirty (30) days following the receipt by the paying Party of an invoice from the receiving Party specifying the amount due. 8.10 Late Payments. Any amount required to be paid by a Party hereunder which is not paid within five (5) Business Days after the date due shallbear interest at a rate equal to the thirty (30) day Dollar LIBOR rate effective for the date that payment was first due as reported by The Wall Street Journal,eastern edition, plus two percent (2%), or the maximum rate permitted under Applicable Law. Such interest shall be computed on the basis of a year of threehundred sixty (360) days for the actual number of days’ payment is delinquent. Interest charged and paid with respect to any late payments will not limit anyother remedies that may be available to a Party. 52CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 8.11 Financial Records and Audit. Licensee (and its Affiliates and Sublicensees) shall keep full, true and accurate records and books of accountcontaining all particulars that may be necessary for the purpose of confirming the accuracy of, and calculating, as applicable, all Royalty Payments,Sublicense Income Payments and other amounts payable to VBL hereunder (including records of Net Sales and Sublicense Income), for a minimum period offive (5) years or such longer period as required by Applicable Laws. VBL shall have a right to request an audit of Licensee (and its Affiliates) by anindependent, internationally recognized accounting firm in order to confirm the accuracy of the foregoing (a “Financial Audit”). Upon the written request byVBL to Licensee to conduct a Financial Audit, VBL shall have the right to engage an independent, internationally recognized accounting firm to perform areview as is reasonably necessary to enable such accounting firm to calculate or otherwise confirm the accuracy of any of the foregoing for the CalendarYear(s) requested by VBL; provided, that (i) such accountants shall be given access to, and shall be permitted to examine and copy such books and records ofLicensee (or its Affiliates) upon ten (10) Business Days’ prior written notice to Licensee, (ii) prior to any such examination taking place, such accountantsshall enter into a confidentiality agreement with Licensee (or its Affiliates) reasonably acceptable to Licensee (or its Affiliates) in order to keep allinformation and data contained in such books and records strictly confidential and shall not disclose such information or copies of such books and records toany third person including VBL, but shall only use the same for the purpose of the reviews and/or calculations which they need to perform in order todetermine any amounts being reviewed, and (iii) such accountants shall use reasonable efforts to minimize any disruption to Licensee’s business. Licenseeshall make personnel reasonably available during regular business hours to answer queries on all such books and records required for the purpose of theFinancial Audit. The accountants shall deliver a copy of their findings to each of the Parties within twenty (20) Business Days of the completion of thereview, and, in the absence of fraud or manifest error, the findings of such accountant shall be final and binding on each of the Parties. Any underpayments byLicensee shall be paid to VBL within twenty (20) Business Days of notification of the results of such inspection. Any overpayments made by Licensee shallbe refunded by VBL within twenty (20) Business Days of notification of the results of such inspection. The cost of the accountants shall be the responsibilityof VBL unless the accountants’ calculation shows that the actual royalties payable, Net Sales, Sublicense Income and/or any other applicable amount auditedhereunder to be different, by more than ten percent (10%), than the amounts as previously calculated and reported by Licensee, in which case Licensee willbe responsible for such costs. In addition, with respect to Sublicensees, VBL shall have the right to participate in Licensee’s audits of Sublicensees for thepurpose of confirming the accuracy of the Sublicense Income Payments and other amounts payable by Sublicensees to Licensee under the sublicensesgranted by Licensee hereunder and for the purpose of determining the accuracy of Licensee’s Net Sales calculation and reports; provided that VBL complieswith all applicable terms and conditions agreed between Licensee and Sublicensee regarding such audits. The audit rights described in this Section 8.11 arewithout limitation of other audit rights described elsewhere in this Agreement. 53CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 9INTELLECTUAL PROPERTY MATTERS 9.1 Ownership of Intellectual Property. 9.1.1 General. Except as expressly set forth in this Agreement or otherwise mutually agreed by the Parties, as between the Parties, (a) VBLshall solely own all VBL Technology, and it alone shall have the right to file, prosecute and control all applications for VBL Patents within and outside ofthe Territory, (b) Licensee shall solely own all Licensee Technology, and it alone shall have the right to file, prosecute and control all applications forLicensee Patents within and outside of the Territory, and (c) VBL and Licensee shall jointly own all Joint Inventions (with each Party having rights to useand license all rights under such Joint Inventions without the duty to account to or obtain consent from the other Party), and each Party hereby assigns andagrees to assign to the other Party, an undivided, one-half of its full right, title and interest in and to such Joint Inventions. Each Party shall promptly discloseto the other Party each material item of VBL Inventions, Licensee Inventions and Joint Inventions, as applicable, made by it during the Term. Thedetermination of inventorship for such Inventions shall be made in accordance with Applicable Laws relating to inventorship set forth in the patentApplicable Laws of the United States (Title 35, United States Code). Notwithstanding the foregoing, Licensee shall not, and shall use CommerciallyReasonable Efforts to cause its Sublicensees not to, grant any license or other right with respect to its interest in the Joint Inventions relating to the Product toany Third Party without the prior written consent of VBL. 9.1.2 Employees. Each Party will require all of its and its Affiliates’ employees to assign all Inventions that are developed, made orconceived by such employees according to the ownership principles described in Section 9.1.1 free and clear of all liens, encumbrances, charges, securityinterests, mortgages or other similar restrictions. Each Party will also use its Commercially Reasonable Efforts to require any agents or independentcontractors performing an activity pursuant to this Agreement to assign all Inventions that are developed, made or conceived by such agents or independentcontractors to VBL and/or Licensee according to the ownership principles described in Section 9.1.1 free and clear of all liens, encumbrances, charges,security interests, mortgages or other similar restrictions. 9.2 Patent Filings, Prosecution and Maintenance. 9.2.1 VBL Patents and Collaboration Patents. (a) Subject to, and without limiting Licensee’s rights under, Section 9.3 of this Agreement, VBL shall have the first right to prepare, file,prosecute and maintain all VBL Patents and Patents covering Joint Inventions (“Collaboration Patents”), at its own cost and expense. VBL shall keepLicensee informed of the status of VBL Patents and Collaboration Patents and will provide Licensee with copies of all substantive documentation submittedto, or received from, the patent offices in connection therewith. With respect to the original submission of a national application that VBL is required to orotherwise intends to submit to a patent office in the Territory with respect to an VBL Patent or Cooperation Patent, VBL shall provide a draft of suchsubmission to Licensee at least thirty (30) days prior to the deadline for, or the intended filing date of, such submission, whichever is earlier and Licenseeshall have the right to review and comment upon any such submission by VBL to a patent office in the Territory, and will provide such comments withinfourteen (14) days after receiving such submission (provided, that if no comments are received within such fourteen (14) day period, then VBL may proceedwith such submission). With respect to subsequent substantive submissions with respect to each such national application, VBL will use reasonable efforts tocomply with such thirty (30) day standard, but if that is not reasonably possible VBL will provide a draft to Licensee with as much lead time as is reasonablypossible under the circumstances. VBL shall consider in good faith any suggestions or recommendations of Licensee concerning the preparation, filing,prosecution and maintenance thereof. If, during the Term, VBL (i) intends to allow any VBL Patent to which Licensee has a license under this Agreement orany Collaboration Patent to expire or intends to otherwise abandon any such VBL Patent or Collaboration Patent, or (ii) decides not to prepare or file patentapplications covering Joint Inventions or VBL Inventions in the Territory to which Licensee would otherwise have a license under this Agreement, VBL shallnotify Licensee of such intention or decision at least thirty (30) days (or as soon as possible if less than thirty (30) days) prior to any filing or payment duedate, or any other date that requires action, in connection with such VBL Patent, VBL Inventions, Joint Invention or Collaboration Patent, and Licensee shallthereupon have the right, but not the obligation, to assume responsibility for the preparation, filing, prosecution or maintenance thereof at its sole cost andexpense, in the name of Licensee. 54CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 9.2.2 Licensee Patents. (a) Licensee shall have the first right to prepare, file, prosecute and maintain all Licensee Patents, at its own cost and expense. Licenseeshall keep VBL informed of the status of Licensee Patents and will provide VBL with copies of all substantive documentation submitted to, or received from,the patent offices in connection therewith. With respect to the original submission of a national application that Licensee is required to or otherwise intendsto submit to a patent office with respect to a Licensee Patent, Licensee shall provide a draft of such submission to VBL at least thirty (30) days prior to thedeadline for, or the intended filing date of, such submission, whichever is earlier and VBL shall have the right to review and comment upon any suchsubmission by Licensee to a patent office in the Territory, and will provide such comments within fourteen (14) days after receiving such submission(provided, that if no comments are received within such fourteen (14) day period, then Licensee may proceed with such submission). With respect tosubsequent substantive submissions with respect to each such national application, Licensee will use reasonable efforts to comply with such thirty (30) daystandard, but if that is not reasonably possible Licensee will provide a draft to VBL with as much lead time as is reasonably possible under the circumstances.Licensee shall consider in good faith any suggestions or recommendations of VBL concerning the preparation, filing, prosecution and maintenance thereof. (b) If, during the Term, Licensee (a) intends to allow any Licensee Patent to which VBL has a license under this Agreement to expire orintends to otherwise abandon any such Licensee Patent, or (b) decides not to prepare or file patent applications covering Licensee Know-How or LicenseeInventions to which VBL would otherwise have a license under this Agreement, Licensee shall notify VBL of such intention or decision at least thirty (30)days (or as soon as possible if less than thirty (30) days) prior to any filing or payment due date, or any other date that requires action, in connection withsuch Licensee Patent or Licensee Inventions, and VBL shall thereupon have the right, but not the obligation, to assume responsibility for the preparation,filing, prosecution or maintenance thereof at its sole cost and expense, in the name of VBL. 55CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 9.2.3 Cooperation. The Parties agree to reasonably cooperate in the preparation, filing, prosecution and maintenance of all Patents under thisSection 9.2, including obtaining and executing necessary powers of attorney and assignments by the named inventors, providing relevant technical reports tothe filing Party concerning the Invention disclosed in such Patent, obtaining execution of such other documents which are needed in the filing andprosecution of such Patent, and, as requested by a Party, updating each other regarding the status of such Patent, and shall cooperate with the other Party sofar as reasonably necessary with respect to furnishing all information and data in its possession reasonably necessary to obtain or maintain such Patents. 9.2.4 Patent Expenses. Any expenses incurred by a Party in connection with the preparation, filing, prosecution and maintenance of anyPatents, as applicable, shall be borne by the Party incurring such expenses. 9.3 Defense and Enforcement of Patents. 9.3.1 Infringement of Third Party Patents. Each of the Parties shall promptly, but in any event no later than ten (10) days after receipt ofnotice thereof, notify the other Party in writing in the event of any claims by a Third Party of alleged patent infringement by Licensee or VBL or any of theirrespective Affiliates or sublicensees (in the case of VBL) or Sublicensees (in the case of Licensee) with respect to the research, development, manufacture, use,sale, offer for sale or importation of a Product (each, an “Infringement Claim”). With respect to any Infringement Claim, VBL shall assume control of thedefense of such Infringement Claim at its sole cost and expense and shall keep Licensee informed of the status thereof. Licensee, upon reasonable request ofVBL, agrees to use Commercially Reasonable Efforts to cooperate with VBL in any such proceedings at VBL’s expense (including, if legally required,joining as a party to such proceedings at VBL’s expense). Licensee will have the right to consult with VBL concerning such Infringement Claim and toparticipate in and be represented by independent counsel of its choice in any litigation in which Licensee is a party at its own expense. VBL shall have theexclusive right to settle any Infringement Claim without the consent of Licensee, as long as such settlement does not have a material adverse impact onLicensee (in which case the consent of Licensee shall be required). For purposes of this Section 9.3.1, any settlement that would involve the waiver or loss ofrights (including the rights to receive payments) of Licensee hereunder shall be deemed a material adverse impact and shall require the consent of Licensee,which consent shall not be unreasonably withheld. For the avoidance of doubt, any consent from Licensee for such settlement shall not limit Licensee’s rightto indemnification under ARTICLE 11 or any other remedies that Licensee may have at law or in equity. 9.3.2 Prosecution of Infringers. (a) Notice. If either Party (i) receives notice of any patent nullity actions, any declaratory judgment actions or any alleged orthreatened infringement of patents or patent applications or misappropriation of intellectual property in the Territory comprising the (w) Joint Inventions orCollaboration Patents, (x) VBL Patents, VBL Inventions or VBL Know-How or (y) Licensee Patents, Licensee Inventions or Licensee Know-How, or (ii) learnsthat a Third Party is materially infringing or allegedly infringing any Patent within the VBL Patents, Licensee Patents or Collaboration Patents or if any ThirdParty claims that any such Patent is invalid or unenforceable, in each case, with respect to the Territory, it shall promptly notify the other Party thereof,including providing evidence of infringement or the claim of invalidity or unenforceability reasonably available to such Party. 56CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (b) Enforcement of Patents. (i) As between VBL and Licensee, (x) VBL shall have the first right (but not the obligation) to take the appropriate steps toenforce or defend any Patent within the VBL Patents and any Collaboration Patents against infringement by a Third Party that is conducting the manufacture,sale, use, offer for sale or import of any pharmaceutical product, whether inside or outside of the Territory, and (y) Licensee shall have the sole and primaryright (but not the obligation) to take the appropriate steps to enforce or defend any Patent within the Licensee Patents in or outside of the Territory againstinfringement by a Third Party that is conducting the manufacture, sale, use, offer for sale or import of any pharmaceutical product in the Territory. Theenforcing Party may take steps including the initiation, prosecution and control of any suit, proceeding or other legal action by counsel of its own choice andshall bear the costs of such enforcement or defense, as applicable. Notwithstanding the foregoing, the other Party will have the right, at its own expense, to berepresented in any such action by counsel of its own choice. (ii) If, pursuant to Section 9.3.2(b)(i), VBL fails to institute such litigation or otherwise take steps to remedy the infringement ofan VBL Patent or a Collaboration Patent within one hundred eighty (180) days of the date one Party has provided notice to the other Party pursuant toSection 9.3.2(a) of such infringement or claim, then Licensee shall have the right (but not the obligation), at its own expense, to bring any such suit, action orproceeding by counsel of its own choice and VBL will have the right, at its own expense, to be represented in any such action by counsel of its own choice.Notwithstanding anything to the contrary contained herein, in no event shall Licensee have any right to bring any suit, action or proceeding with respect toany matter involving infringement of an VBL Manufacturing Patent, or a Patent outside the Territory or outside the Field. (c) Cooperation; Damages. (i) If one Party brings any suit, action or proceeding under Section 9.3.2(b), the other Party agrees to be joined as party plaintiffif necessary to prosecute the suit, action or proceeding and to give the first Party reasonable authority to file and prosecute the suit, action or proceeding(including, in the case of any suit, action or proceeding by Licensee involving the VBL Patents, by registering the rights granted by VBL to Licenseehereunder as an exclusive license with applicable Governmental Authority); provided, however, that neither Party will be required to transfer any right, titleor interest in or to any property to the other Party or any other party to confer standing on a Party hereunder. (ii) The Party not pursuing the suit, action or proceeding hereunder will provide reasonable assistance to the other Party,including by providing access to relevant documents and other evidence and making its employees available, subject to the other Party’s reimbursement ofany Out-of-Pocket Costs incurred by the non-enforcing or defending Party in providing such assistance. 57CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (iii) Neither Party shall, without the prior written consent of the other Party (in its sole discretion), enter into any compromise orsettlement relating to any claim, suit or action that it brought under Section 9.3.2 involving any applicable Patent that admits the invalidity orunenforceability of such Patent, or requires the other Party to pay any sum of money, or otherwise adversely affects the rights of the other Party with respect tosuch Patents, the Product or the other Party’s rights hereunder (including the rights to receive payments). (iv) Any settlements, damages or other monetary awards (a “Recovery”) recovered pursuant to a suit, action or proceedingbrought pursuant to Section 9.3.2(b) will be allocated first to the costs and expenses of the Party taking such action, and second, to the costs and expenses (ifany) of the other Party, with any remaining amounts (if any) to be allocated as follows: (i) to the extent that such Recovery is a payment for lost sales of theProduct in the Field in the Territory, (a) if Licensee is the Party taking such action, then Licensee shall pay a Royalty Payment to VBL pursuant to Section 8.3with respect to the imputed loss in Net Sales out of any such Recovery or (b) if VBL is the Party taking such action, then any such Recovery shall be sharedequally by VBL and Licensee and (ii) all remaining Recoveries shall be payable to the Party taking such action to the extent such remaining Recoveriesrelate solely to the Product in the Field in the Territory (and, for purposes of clarity, all remaining Recoveries related to the Product outside the Field oroutside the Territory shall be payable to VBL). 9.4 Patent Term Extensions. Upon Licensee’s request, VBL shall seek, in Licensee’s name if so required, Patent Term Extensions (including anysupplemental protection certificates and the like available under Applicable Laws) in the Territory in relation to the VBL Patents (including CollaborationPatents). Licensee and VBL shall cooperate in connection with all such activities. VBL, its agents and attorneys will give due consideration to allsuggestions and comments of Licensee regarding any such activities. 9.5 Patent Marking. Licensee shall mark the Product marketed and sold by Licensee (or its Affiliate, wholesaler or distributor) hereunder withappropriate patent numbers or indicia, as long as it is required by Applicable Laws. 9.6 Patent Challenge. VBL will be permitted to terminate this Agreement upon written notice to Licensee, effective upon receipt, if Licensee (or itsAffiliates), directly or indirectly, initiate or request an interference or opposition proceeding with respect to, or make, file or maintain any claim, demand,lawsuit or cause of action to challenge the validity or enforceability of, or, to the extent applicable, oppose any extension of, or the grant of asupplementary protection certificate with respect to, any VBL Patent or VBL Manufacturing. ARTICLE 10REPRESENTATIONS, WARRANTIES AND COVENANTS 10.1 Mutual Representations and Warranties. Each Party hereby represents, warrants, and covenants (as applicable) to the other Party as follows,as of the Effective Date: 58CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (a) It has the corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder, and theexecution, delivery and performance of this Agreement has been duly and validly authorized and approved by proper corporate action on the part of suchParty. Assuming due authorization, execution and delivery on the part of the other Party, this Agreement constitutes a legal, valid and binding obligation ofsuch Party, enforceable against such Party, in accordance with its terms. (b) The execution and delivery of this Agreement by it and the performance by it contemplated hereunder will not violate any ApplicableLaws, and, to its knowledge, it is and will continue to be during the Term in compliance in all material respects with all material Applicable Laws applicableto the subject matter of this Agreement. (c) It is not a party to any agreement or arrangement with any Third Party or under any obligation or restriction (including any outstandingorder, judgment or decree of any court or administrative agency) which in any way limits or conflicts with its ability to fulfill any of its obligations under thisAgreement. (d) Except with respect to Regulatory Approvals for the Development, Manufacturing or Commercialization of the Product or as otherwisedescribed in this Agreement, (i) all necessary consents, approvals and authorizations of, and (ii) all notices to, and filings by such Party with, allGovernmental Authorities and other Persons required to be obtained or provided by such Party as of the Effective Date in connection with the execution,delivery and performance of this Agreement have been obtained and provided, except for those approvals, if any, not required at the time of execution of thisAgreement. (e) In the course of the Development of Products, such Party has not used prior to the Effective Date and shall not use, during the Term, anyemployee, agent or, to its knowledge, independent contractor who has been debarred by any Regulatory Authority, or, to such Party’s knowledge, is thesubject of debarment proceedings by a Regulatory Authority. (f) As of the Effective Date, no claim or demand of any Person has been asserted in writing to such Party arising out of such Party’sdevelopment, regulatory or commercialization activities with respect to any other products that could reasonably be expected to impact such Party’s abilityto perform any of its obligations under this Agreement, and no investigations are pending or, to the knowledge of such Party, threatened relating to suchactivities. 10.2 Additional Representations, Warranties and Covenants of VBL. VBL hereby represents, warrants and covenants (as applicable) to Licenseethat: (a) As of the Effective Date, VBL is the owner or exclusive licensee of, and has the right to license to the extent set forth herein, the VBLPatents and VBL Know-How licensed to Licensee hereunder, free and clear of all mortgages, pledges, charges, liens, equities, security interests, or otherencumbrances or similar agreements, or any other obligation with respect to any of the foregoing that would conflict or interfere with any of the rights orlicenses granted to Licensee hereunder. 59CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (b) As of the Effective Date, neither VBL nor its Affiliates, nor, to the knowledge of VBL, its subcontractors nor sublicensees, has receivedwritten notice of any proceedings pending before or threatened by any Regulatory Authority with respect to the Product or any Facility where the Product isManufactured, and to VBL’s knowledge there is no basis for the foregoing. (c) Prior to and as of the Effective Date, to the knowledge of VBL, no Third Party (i) is infringing any VBL Patents or VBL ManufacturingPatents or has misappropriated any VBL Technology or VBL Manufacturing Know-How or (ii) has challenged the scope, duration, validity, enforceability,priority, or VBL’s right to use or license any VBL Technology, VBL Manufacturing Patent or VBL Manufacturing Know-How. (d) Prior to and as of the Effective Date, to the knowledge of VBL, no patent, trademark or other intellectual property right owned by aThird Party would be infringed by research, development, manufacture, use, sale, offer for sale, or import of the Product in the Field in the Territory, and VBLand its Affiliates, and to the knowledge of VBL, its subcontractors and sublicensees, have received no notice of any action or proceeding claiming the same. (e) As of the Effective Date, VBL has obtained assignments from the inventors of all inventorship rights relating to the VBL Patents whichare owned by VBL, and, to the knowledge of VBL, all such assignments of inventorship rights relating to such VBL Patents are valid and enforceable. (f) Prior to and as of the Effective Date, to the knowledge of VBL, VBL has complied with all Applicable Laws, in all material respects,including any disclosure requirements, in connection with the filing, prosecution and maintenance of the VBL Patents owned by VBL, and VBL shallcontinue to comply in all material respects with such Applicable Laws in such connection during the Term. (g) The Finished Product furnished by VBL to Licensee under this Agreement: (i) shall be manufactured, handled, stored and shipped by VBL, in accordance with, and shall conform to, the applicable ProductSpecifications and free of any other manufacturing defects or material damages from VBL’s handling, storage or shipment; (ii) shall be manufactured, handled and stored by or on behalf of VBL in compliance with all Applicable Laws; and (iii) shall be manufactured using Product which is manufactured, handled, stored and shipped by or on behalf of VBL inaccordance with, and conforms to, the applicable Product Specifications and in compliance with all Applicable Laws. 10.3 Additional Representations, Warranties and Covenants of Licensee. Licensee hereby represents, warrants and covenants (as applicable) toVBL that: (a) As of the Effective Date, Licensee is solvent and has the ability to pay and perform all of its obligations as and when such obligationsbecome due, including payment obligations and other obligations under this Agreement.60CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (b) As of the Effective Date, Licensee’s compensation programs for its Sales Representatives do not, and during the Term will not withrespect to the Product, provide financial incentives for the promotion, sales, and marketing in violation of any Applicable Laws or any professionalrequirements. (c) During the Term, Licensee’s medical, regulatory or legal teams, as applicable, will review all training materials and programs prior to useby Licensee to ensure that such training materials and programs are in accordance with the Commercialization Plan and the Regulatory Approvals and incompliance with Applicable Laws. (d) As of the Effective Date, to the knowledge of Licensee, Licensee has complied with all Applicable Laws in all material respects. 10.4 Disclaimer. Subject to the regulatory and commercial status of the Product in the U. S. as of the Effective Date, Licensee understands that theProduct is the subject of ongoing clinical research and development and that VBL cannot ensure the safety or usefulness of the Product or that the Productwill receive Regulatory Approvals. In addition, VBL makes no warranties except as set forth in this ARTICLE 10 concerning the VBL Technology. 10.5 No Other Representations or Warranties. EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, NO REPRESENTATIONS ORWARRANTIES WHATSOEVER, WHETHER EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY, FITNESS FOR APARTICULAR PURPOSE, NON-INFRINGEMENT, OR NON-MISAPPROPRIATION OF THIRD PARTY INTELLECTUAL PROPERTY RIGHTS, ARE MADEOR GIVEN BY OR ON BEHALF OF A PARTY. EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, ALL REPRESENTATIONS ANDWARRANTIES, WHETHER ARISING BY OPERATION OF LAW OR OTHERWISE, ARE HEREBY EXPRESSLY EXCLUDED. ARTICLE 11INDEMNIFICATION 11.1 Indemnification by VBL. VBL hereby agrees to save, indemnify, defend and hold Licensee, its Affiliates, and their respective directors,officers, agents and employees harmless from and against any and all losses, damages, liabilities, costs and expenses (including reasonable attorneys’ fees andexpenses) (collectively, “Losses”) arising in connection with any and all charges, complaints, actions, suits, proceedings, hearings, investigations, claims,demands, judgments, orders, decrees, stipulations or injunctions by a Third Party (each a “Third Party Claim”) resulting or otherwise arising from (i) anymaterial breach by VBL or its Affiliates, sublicensees or subcontractors of any of VBL’s representations, warranties, covenants or obligations pursuant to thisAgreement, (ii) the negligence or willful misconduct by VBL or its Affiliates, sublicensees or subcontractors or their respective officers, directors, employees,agents or consultants in performing any obligations under this Agreement, (iii) any matter related to the Development and Manufacturing of the Producthereunder by VBL or its Affiliates, sublicensees or subcontractors or their respective officers, directors, employees, agents or consultants or (iv) the failure byVBL to conduct a Product recall, withdrawal or market notification that is initiated by Licensee under Section 5.8.1. 61CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 11.2 Indemnification by Licensee. Licensee hereby agrees to save, indemnify, defend and hold VBL, its Affiliates, and their respective directors,agents and employees harmless from and against any and all Losses arising in connection with any and all Third Party Claims resulting or otherwise arisingfrom (i) any material breach by Licensee (or by any of its Affiliates, Sublicensees, subcontractors, wholesalers or distributors) of any of Licensee’srepresentations, warranties, covenants or obligations pursuant to this Agreement, (ii) the negligence or willful misconduct by Licensee (or by any of itsAffiliates, Sublicensees, subcontractors, wholesalers or distributors) or their respective officers, directors, employees, agents or consultants in performing anyobligations under this Agreement, (iii) any matter related to the Development, Packaging and Labeling (or Manufacturing to the extent permitted under thisAgreement), or Commercialization of the Product hereunder by Licensee (or by any of its Affiliates, Sublicensees, subcontractors, wholesalers or distributors)or their respective officers, directors, employees, agents or consultants, or (iv) the failure by Licensee to initiate a Product recall, withdrawal or marketnotification that is agreed by the Parties under Section 5.8.1. 11.3 Indemnification Procedures. The obligations to indemnify and defend set forth in Sections 11.1 and 11.2 shall be contingent upon the Partyseeking indemnification (the “Indemnitee”): (a) notifying the indemnifying Party of a claim, demand or suit within fifteen (15) Business Days of receipt ofsame (provided, however, that Indemnitee’s failure or delay in providing such notice shall not relieve the indemnifying Party of its indemnificationobligation except to the extent the indemnifying Party is prejudiced thereby), (b) allowing the indemnifying Party and/or its insurers the right to assumedirection and control of the defense of any such Third Party Claim, (c) using its Commercially Reasonable Efforts to cooperate with the indemnifying Partyand/or its insurers in the defense of such Third Party Claim at the indemnifying Party’s expense, and (d) agreeing not to settle or compromise any ThirdParty Claim without prior written authorization of the indemnifying Party. Indemnitee shall have the right to participate in the defense of any such Claimreferred to in this Section 11.3 utilizing attorneys of its choice, at its own expense; provided, however, that the indemnifying Party shall have full authorityand control to handle any such Claim. The indemnifying Party shall have the right to settle or compromise any action or otherwise seek to terminate anypending or threatened action for which indemnity may be sought hereunder (whether or not any indemnified Party is a party thereto) as long as suchsettlement, compromise or termination includes an unconditional release of, and does not include an admission of liability by, each indemnified Party fromall liability in respect of such Third Party Claim. 11.4 Limitation of Liability. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL, INCIDENTAL, ORINDIRECT DAMAGES ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THEPOSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS SECTION 11.4 IS INTENDED TO OR SHALL LIMITOR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF ANY PARTY UNDER SECTION 11.1 or 11.2, IN EACH CASE WITH RESPECTTO PAYMENT TO THIRD PARTIES, OR DAMAGES AVAILABLE FOR A PARTY’S BREACH OF CONFIDENTIALITY OBLIGATIONS UNDER ARTICLE12. 62CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 11.5 Insurance. Each Party shall procure and maintain insurance that is available on commercially reasonable terms, including general liability,clinical trial insurance, product liability insurance and other insurance as necessary, adequate to cover its obligations hereunder and which is consistent withnormal business practices of prudent companies similarly situated at all times during which Product is being clinically tested in human subjects orcommercially distributed or sold by a Party pursuant to this Agreement, and such insurance coverage shall be, in no event less than, in amounts per lossoccurrence and in the aggregate as are customary in the industry in the Territory. It is understood that such insurance shall not be construed to create a limitof either Party’s liability with respect to its indemnification obligations under this ARTICLE 11. Each Party shall provide the other Party with writtenevidence of such insurance upon request of the other Party and upon expiration of any one coverage. Each Party shall provide the other Party with writtennotice at least thirty (30) days prior to the cancellation, nonrenewal or material change in such insurance which materially adversely affects the rights of theother Party hereunder. Without limiting the foregoing, Licensee shall cause its insurance policies to name VBL as an additional insured without cost to VBL. ARTICLE 12CONFIDENTIALITY 12.1 Confidential Information. As used in this Agreement, the term “Confidential Information” means all information, whether it be written ororal, including all production schedules, lines of products, volumes of business, processes, new product developments, product designs, formulae, technicalinformation, patent information, Know-How, trade secrets, financial and strategic information, marketing and promotional information and data, and othermaterial relating to any products, projects or processes of one Party (the “Disclosing Party”) that is provided to, or otherwise obtained from the DisclosingParty by, the other Party (the “Receiving Party”) in connection with this Agreement (including information exchanged prior to the date hereof in connectionwith the transactions set forth in this Agreement, including any information disclosed by either Party pursuant to the Confidentiality and NondisclosureAgreement between the Parties dated July 20, 2017 (the “Confidential Disclosure Agreement”)). Notwithstanding the foregoing sentence, ConfidentialInformation shall not include any information or materials that: (a) were already known to the Receiving Party (other than under an obligation of confidentiality), at the time of disclosure by theDisclosing Party, to the extent such Receiving Party has documentary evidence to that effect; (b) were generally available to the relevant public or otherwise part of the public domain at the time of disclosure thereof to the ReceivingParty; (c) became generally available to the relevant public or otherwise part of the public domain after disclosure or development thereof, as thecase may be, and other than through any act or omission of a Party in breach of such Party’s confidentiality obligations under this Agreement; or (d) were independently discovered or developed by or on behalf of the Receiving Party without the use of the Confidential Informationbelonging to the other Party, to the extent such Receiving Party has documentary evidence to that effect. 63CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 12.2 Confidentiality Obligations. Each of Licensee and VBL shall keep all Confidential Information received from or on behalf of the other Partywith the same degree of care with which it maintains the confidentiality of its own Confidential Information, but in all cases no less than a reasonable degreeof care. Neither Party shall use such Confidential Information for any purpose other than in performance of this Agreement, or exercise of rights under thisAgreement, or disclose the same to any other Person other than to such of its and its Affiliates’ directors, managers, employees, independent contractors,agents, consultants or its sublicensees, who have a need to know such Confidential Information to implement the terms of this Agreement or enforce its rightsunder this Agreement; provided, however, that a Receiving Party shall advise any of its and its Affiliates’ directors, managers, employees, independentcontractors, agents, consultants or its sublicensees, who receives such Confidential Information of the confidential nature thereof and of the obligationscontained in this Agreement relating thereto, and the Receiving Party shall ensure (including, in the case of a Third Party, by means of a written agreementwith such Third Party having terms at least as protective as those contained in this ARTICLE 12) that all such directors, managers, employees, independentcontractors, agents, consultants or its sublicensees comply with such obligations. Upon termination of this Agreement, the Receiving Party shall return ordestroy all documents, tapes or other media containing Confidential Information of the Disclosing Party that remain in the possession of the Receiving Partyor its directors, managers, employees, independent contractors, agents, consultants or its sublicensees, except that the Receiving Party may keep copies of theConfidential Information, solely for archival purposes. Such archival copy shall be deemed to be the property of the Disclosing Party, and shall continue tobe subject to the provisions of this ARTICLE 12. 12.3 Permitted Disclosure and Use. Notwithstanding Section 12.2, either Party may disclose Confidential Information belonging to the otherParty only (i) to the extent such disclosure is reasonably necessary to comply with or enforce any of the provisions of this Agreement or to comply withApplicable Laws or (ii) to the extent such disclosure is reasonably necessary to obtain or maintain Regulatory Approval of the Product and such disclosure ismade to a Governmental Authority. If a Party deems it necessary to disclose Confidential Information of the other Party pursuant to this Section 12.3, suchParty shall give reasonable advance written notice of such disclosure to the other Party to permit such other Party sufficient opportunity to object to suchdisclosure or to take measures to ensure confidential treatment of such information, including seeking a protective order or other appropriate remedy.Notwithstanding Section 12.2, each Party may also disclose Confidential Information belonging to the other Party related to the Product to Third Parties inthe course of and solely to the extent necessary for due diligence examinations carried out by potential investors or business partners (provided, that suchThird Parties are bound by written agreements having terms at least as protective as those contained in this ARTICLE 12 with respect to keeping suchConfidential Information confidential). 12.4 Notification. The Receiving Party shall notify the Disclosing Party promptly upon discovery of any material unauthorized use or disclosure ofthe Disclosing Party’s Confidential Information, and will cooperate with the Disclosing Party in any reasonably requested fashion to assist the DisclosingParty to regain possession of such Confidential Information and to prevent its further unauthorized use or disclosure. 64CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 12.5 Publicity; Filing of this Agreement. 12.5.1 Publicity. The press release to be issued in connection with this Agreement and the transactions described herein is set forth onSchedule 12.5.1. Except as otherwise provided in this Section 12.5, each Party shall maintain the confidentiality of all provisions of this Agreement, andwithout the prior written consent of the other Party, which consent shall not be unreasonably withheld, neither Party nor its respective Affiliates shall makeany press release or other public announcement of or otherwise disclose the provisions of this Agreement to any Third Party not otherwise disclosed in anyagreed-upon press release or other public announcement, except for: (i) disclosure to those of its directors, officers, employees, accountants, attorneys,underwriters, lenders and other financing sources, potential strategic partners, advisors, agents and its sublicensees, whose duties reasonably require them tohave access to this Agreement; provided, that such directors, officers, employees, accountants, attorneys, underwriters, lenders and other financing sources,advisors, agents or sublicensees, are required to maintain the confidentiality of this Agreement; (ii) disclosures required by The NASDAQ Stock Market orany securities exchanges, in which case the disclosing Party shall provide the non-disclosing Party with at least sixty (60) hours-notice, but in any event nolater than the time the disclosure required by such NASDAQ Stock Market or any securities exchange is made; (iii) disclosures as may be required byApplicable Laws, in which case the disclosing Party shall provide the non-disclosing Party with prompt advance notice of such disclosure and cooperate withthe non-disclosing Party to seek a protective order or other appropriate remedy, including a request for confidential treatment in the case of a filing with theU.S. Securities and Exchange Commission; (iv) the report on Form 6-K or any equivalent in the Territory, which may be filed by setting forth the press releasereferred to above, and/or this Agreement in redacted form (i.e., Redacted Agreement) as provided in Section 12.5.2 and/or a summary thereof; (v) disclosuresthat are consistent with or complementary to those described in clause (iv) but which do not contain any Confidential Information of the other Party; and (vi)other disclosures for which consent has previously been given. A Party may publicly disclose without regard to the preceding requirements of this Section12.5 any information that was previously publicly disclosed pursuant to this Section 12.5, so long as the context and extent of such disclosure issubstantially similar to the context in and extent to which the initial disclosure was made. 12.5.2 Required Filings. Notwithstanding Section 12.5.1, each Party may publicly disclose without violation of this Agreement, such termsof this Agreement as are, on the advice of such Party’s counsel, required by the rules and regulations of the SEC or The NASDAQ Stock Market, Inc. or otherapplicable securities exchanges (“Redacted Agreement”); provided, that such disclosing Party shall advise the other Party of such intended disclosures andprovide the other Party with reasonable opportunity to request that the disclosing Party seek confidential treatment of such disclosures. Subject to theimmediately preceding sentence, such disclosing Party shall consult with the other Party, and the other Party shall have the right to review and comment withrespect to the Redacted Agreement or the other Party’s Confidential Information as part of the confidential treatment request to the SEC or such otherapplicable exchange. After release of the press release announcing this Agreement and excluding any public disclosures of the terms of this Agreement thatare authorized by the preceding sentences or Section 12.5.1, if either Party desires to make a public announcement concerning the material terms of thisAgreement, milestones achieved under this Agreement or the other Party’s Confidential Information, then such shall give reasonable prior advance notice ofthe proposed text of such announcement to the other Party for its prior review and approval (except as otherwise provided herein), such approval not to beunreasonably withheld, conditioned or delayed; provided, that the other Party shall provide its comments, if any, within five (5) Business Days (or one (1)Business Day in the event the disclosing Party is required to make such disclosure pursuant to Applicable Laws or stock exchange rules) after receiving thepublic announcement for review (and failure of the other Party to provide comments within such time period shall be deemed to constitute the other Party’sconsent to such public announcement). In relation to the other Party’s review of such an announcement, the other Party may make specific, reasonablecomments on such proposed press release or other public disclosure within the prescribed time for commentary. Neither Party shall be required to seek thepermission of the other Party to disclose any information already disclosed or otherwise in the public domain, provided such information remains accurate. 65CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 12.6 Publication. Each Party shall submit to the other Party copies in English of each proposed academic, scientific, medical and other publicationor presentation that contains or refers to any Confidential Information or technology provided by the other Party at least sixty (60) days in advance ofsubmitting such proposed publication or presentation to a publisher or other Third Party. Upon receipt thereof, the other Party shall have the right to reviewand comment on each such proposed publication or presentation and request that the submitting Party remove any of its Confidential Information prior tosubmission for publication or presentation. Upon such request, the submitting Party shall redact or otherwise modify the proposed publication or presentationto remove any such Confidential Information of the other Party. In addition, in the event that the document includes data, information or material generatedby the other Party’s scientists, and professional standards for authorship would be consistent with including such scientists as co-authors of the document, theParties shall discuss in good faith the inclusion of the names of such scientists as co-authors. 12.7 Use of Names. Except as otherwise set forth in this Agreement, neither Party shall use the name of the other Party in relation to this transactionin any public announcement, press release or other public document without the written consent of such other Party, which consent shall not be unreasonablywithheld; provided, however, that subject to Section 12.5, either Party may use the name of the other Party in any document filed with any RegulatoryAuthority or Governmental Authority, including the Securities and Exchange Commission and any applicable securities exchanges. 12.8 Survival. The obligations and prohibitions contained in this ARTICLE 12 as they apply to Confidential Information shall survive theexpiration or termination of this Agreement for a period of five (5) years. ARTICLE 13TERM AND TERMINATION 13.1 Term. This Agreement shall become effective on the Effective Date and, unless earlier terminated pursuant to this ARTICLE 13, shall remainin effect until the later of (a) the date on which Licensee and its Sublicenses cease selling the Product in the Territory or (b) expiration of the Royalty Term(the “Term”). 66CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 13.2 Termination for Breach. In the event that either Party reasonably believes that a material breach in the performance by the other Party of itsobligations under this Agreement has occurred, the Parties shall first consult with each other in good faith and use Commercially Reasonable Efforts toamicably resolve the disputed subject matter prior to the other Party invoking its termination rights under this Section 13.2. Subject to the foregoing, eitherParty may, without prejudice to any other remedies available to it at law or in equity, terminate this Agreement upon written notice to the other Party in theevent that the other Party (the “Breaching Party”) shall have materially breached or defaulted in the performance of its obligations under this Agreement,including without limitation, in the case of a breach by Licensee of its obligations under Section 4.2.2 or Section 6.3.1. The Breaching Party shall haveninety (90) days (sixty (60) days in the event of payment) after written notice thereof was provided to the Breaching Party by the non-breaching Party toremedy such default. Unless the Breaching Party has cured any such breach or default prior to the expiration of such ninety (90) day period (sixty (60) daysin the event of payment), such termination shall become effective upon the end of the ninety (90) day period (sixty (60) days in the event of payment). Inthe event of any dispute as to whether or not a material breach has been committed under this Section 13.2, the Parties shall first consult with each other ingood faith and use good faith efforts to settle such dispute. Should the Parties fail to agree on the settlement of any such dispute, the matter shall besubmitted to and finally resolved by arbitration in accordance with Section 15.3 (provided, however, that referral to the Executive Officers shall not beapplicable, and the time period for a decision under Section 15.3.2 shall be three (3) months following selection of the arbitrator). For the avoidance ofdoubt, if Licensee is entitled to terminate this Agreement in accordance with the foregoing, it is agreed that Licensee shall also have the right not toterminate this Agreement. In the case that Licensee chooses not to terminate this Agreement, Licensee shall have the right to claim damages arising out ofVBL’s material breach; provided, however, that it is understood and agreed that Licensee shall remain subject to its payment obligations incurred priorthereto as set forth in ARTICLE 8. 13.3 Termination as a Result of Bankruptcy. Each Party shall have the right to terminate this Agreement upon written notice as a result of thefiling or institution of bankruptcy, reorganization, liquidation or receivership proceedings, or upon an assignment of a substantial portion of the assets for thebenefit of creditors by the other Party; provided, that such termination shall be effective only if such proceeding is not dismissed within ninety (90) days afterthe filing thereof. 13.4 Termination by Licensee for Convenience. At any time during the Term, Licensee has the right to immediately terminate this Agreementwith or without cause upon ninety (90) days prior written notice to VBL. ARTICLE 14EFFECTS OF TERMINATION AND EXPIRATION 14.1 Termination. Without limiting any other legal or equitable remedies that a Party may have, if this Agreement is terminated by either Partyand for any reason prior to its natural expiration, then the following provisions shall apply: 67CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 14.1.1 Termination of Licenses. All rights and licenses granted to Licensee hereunder shall immediately terminate and be of no furtherforce and effect and Licensee shall cease Developing and Commercializing the Product (except as otherwise set forth in Section 14.1.3). 14.1.2 Assignments. In the event of a termination of this Agreement, subject to Section 14.1.7, upon request by VBL, Licensee willpromptly, in each case within sixty (60) days after receipt of such request: (a)at VBL’s election, assign to VBL or its designee all of Licensee’s right, title and interest in and to any agreements (or portions thereof) betweenLicensee and Third Parties that relate to the Development or Commercialization of the Product, or terminate such agreements; (b)assign to VBL or its designee all of Licensee’s right, title and interest in and to any (i) Licensee Know-How (including all of Licensee’s right, titleand interest in and to any and all Development Data and Commercialization Data Controlled by Licensee for the Product), (ii) Collaboration Patents,and (iii) Promotional Materials and copyrights and trademarks, including any goodwill associated therewith, and any registrations and designpatents for the foregoing, all to the extent solely related to the Product; provided, however, in the event VBL exercises such right to have assignedsuch Promotional Materials, Licensee shall grant, and hereby does grant, to VBL a royalty-free right and license to any trademarks, trademarks,names and logos of Licensee contained therein for a period of twelve (12) months in order to use such Promotional Materials in connection with theCommercialization of the Product. In furtherance of the foregoing, Licensee shall execute, and shall cause its Affiliates to execute, any documentsreasonably required to confirm VBL’s sole ownership of Licensee Know-How, Collaboration Patents and Internet domain names, and any documentsrequired to apply for, maintain and enforce any Patent or other right in the Licensee Know-How or Collaboration Patents; (c)at VBL’s sole discretion, (i) assign to VBL or its designee the management and continued performance of any clinical trials for the Product ongoinghereunder as of the effective date of such termination in respect of which VBL shall assume full financial responsibility from and after the effectivedate of such termination, (ii) continue performing such activities (in accordance with applicable terms and conditions of this Agreement) at VBL’sreasonable cost and expense, except in the event that VBL has terminated this Agreement under Section 13.2 in connection Licensee’s breach, inwhich case at Licensee’s cost and expense, or (iii) wind-down the performance of such activities at Licensee’s cost and expense; (d)transfer to VBL or its designee any and all of Licensee’s right, title and interest in and to any and all regulatory filings, Regulatory Approvals andother Regulatory Materials for the Product in respect of which VBL shall assume full financial responsibility; and (e)provide a copy of (i) the material tangible embodiments of the foregoing and (ii) any other material books, records, files and documents Controlledby Licensee solely to the extent related to the Product, and, to the extent applicable, in accordance with Section 14.1.3; provided, that suchmaterials may be redacted to exclude Confidential Information of Licensee that is unrelated to the Product; 68CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. provided, however, that to the extent that any agreement or other asset described in this Section 14.1.2 is not assignable by Licensee and/or relatesto businesses other than the Development or Commercialization of the Product, then such agreement or other asset will not be assigned, and uponthe request of VBL, the Parties will discuss the treatment thereof, and Licensee will use Commercially Reasonable Efforts to take such steps as maybe reasonably necessary to allow VBL or its designee to obtain and to enjoy the benefits of, and to assume the obligations of, such agreement orother asset . For purposes of clarity, (1) VBL shall have the right to request that Licensee take any or all of the foregoing actions in whole or in part,or with respect to all or any portion of the assets set forth in the foregoing provisions and (2) to the extent VBL requests Licensee to transfer its right,title and interest in the items set forth in this Section 14.1.2 to VBL or its designee, Licensee shall also cause its Affiliates to transfer and assign toVBL or its designee all of such Affiliates’ right, title and interest in and to the foregoing items set forth in this Section 14.1.2. 14.1.3 Delivery of Licensee Know-How. Upon request by VBL, Licensee will promptly transfer to VBL or its designee copies of anyphysical embodiment of any Licensee Know-How, to the extent then used in connection with the Development or Commercialization of Product, and suchtransfer shall be effected by the delivery of material documents in Licensee’s possession. The appropriate technical teams at VBL (or its designee) andLicensee will meet to plan transfer for the Licensee Know-How as follows: (i) Licensee’s designated representative(s) for Product will meet withrepresentatives from VBL or its designee to answer questions with respect to the Licensee Know-How and establish a plan for the transfer for such LicenseeKnow-How; and (ii) each Party will allocate adequate appropriately qualified representatives to work with the other Party (and in the case of VBL, VBL or itsdesignee) to review the Licensee Know-How to enable the completion of the transfer within thirty (30) days of the completion of the initial transfer planningmeetings to the extent reasonable, but in any event no longer than sixty (60) days thereafter. 14.1.4 Disposition of Inventory. In the event that this Agreement is terminated other than by VBL under Section 13.2 in connection withLicensee’s breach, Licensee and its Affiliates will be entitled, during the period ending on the last day of the sixth (6th) full month following the effectivedate of such termination, to sell any inventory of Product affected by such termination that remains on hand as of the effective date of the termination, solong as Licensee pays to VBL the Royalty Payments and other amounts payable hereunder (including milestones) applicable to said subsequent sales, withrespect to sales in the Territory, as applicable, in accordance with the terms and conditions set forth in this Agreement and otherwise complies with the termsset forth in this Agreement. In the event this Agreement is terminated by VBL under Section 13.2 in connection with Licensee’s breach, VBL shall have theoption to purchase any inventory of Product affected by such termination at the original Supply Price therefor. 14.1.5 Disposition of Commercialization Related Materials. Upon request by VBL, Licensee will promptly deliver to VBL or its designeein electronic, sortable form (a) a list identifying all wholesalers and other distributors involved in the Commercialization of the Product in the Territory aswell as any customer lists (e.g., purchasers) related to the Commercialization of the Product in the Territory, and (b) all Promotional Materials as well as anyitems bearing the Product Trademark and/or any trademarks or trademarks of VBL otherwise associated with the Product. 69CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 14.1.6 Termination other than for Breach. Except for termination by Licensee pursuant to Section 13.2, upon termination of thisAgreement, in addition to the effects of termination set forth in this ARTICLE 14, the following obligations shall apply: (i) Licensee shall remain responsiblefor all of Licensee’s accrued but unpaid Development and Commercialization costs until the effective date of termination for twelve (12) months after noticeof termination; (ii) to the extent Licensee is unable to assign to VBL the management and continued performance of any clinical trials pursuant to Section14.1.2(c), Licensee shall remain responsible to conduct such on-going clinical trials or other related Development activities in the Territory until suchclinical trials or other activities can be wound down in compliance with Applicable Laws and appropriate ethical standards prevailing in the industry oreffectively transferred to VBL; and (iii) Licensee shall not take any action that is intended or reasonably likely to materially adversely affect or impair thefurther Development or Commercialization of the Product by VBL. 14.1.7 Transfer Costs and Additional Consideration. With respect to the assignments, delivery and disposition of materials set forth inthis Section 14.1 (including such steps necessary to allow VBL or its designee to obtain and enjoy the benefits of the relevant agreement or asset), the Partiesshall allocate all reasonable, documented and pre-approved Out-of-Pocket Costs incurred as transfer costs for such assignment, delivery or disposition(“Transfer Costs”), and VBL shall additionally pay mutually agreed amounts that reasonably approximate the costs incurred by Licensee during the Term ofthis Agreement for developing or otherwise obtaining the transferring Know-How, materials and/or rights (“Assignment Consideration”), as follows: (a)in the event of an assignment requested by VBL after termination of this Agreement by VBL pursuant to Section 13.2 or 13.3, or by Licenseepursuant to Section 13.4, Licensee shall bear all Transfer Costs for any applicable assignments, delivery and/or disposition of materials set forth inthis Section 14.1, and VBL shall owe no additional Assignment Consideration to Licensee; and (b)in the event of an assignment requested by VBL after termination of this Agreement by Licensee pursuant to Section 13.2 or 13.3, VBL shall bear allTransfer Costs for any applicable assignments, delivery and/or disposition of materials set forth in this Section 14.1, and VBL shall additionally paythe Assignment Consideration to Licensee. For all payments due under this Section 14.1.7, the receiving Party shall promptly invoice the paying Partying for the applicable amounts upon completionof the assignment, delivery and/or disposition of the relevant materials, and such payments shall be made within thirty (30) days following receipt of suchinvoice by the paying Party and subject to Section 8.10 if not made within such thirty (30) day period. 14.1.8 Grant-Back License to Licensee. With respect to any Licensee Know-How, Collaboration Patent and Promotional Materialsassigned by Licensee to VBL pursuant to Section 14.1.2(b), VBL shall grant, and hereby does grant, to Licensee a non-exclusive, perpetual, irrevocable,sublicensable, royalty-free license to use the foregoing for any purpose in or outside of the Territory, except for the Development or Commercialization of theProduct. 70CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 14.2 Expiration of this Agreement. 14.2.1 Upon expiration of this Agreement pursuant to Section 13.1 (as opposed to termination of this Agreement), the licenses granted toLicensee under Section 2.1 shall become fully paid-up, royalty-free, perpetual and non-exclusive licenses. 14.2.2 Licensee may use the Regulatory Materials and Regulatory Data provided by VBL hereunder or generated by Licensee hereunder, andany other Development Data and Commercialization Data, for the purposes of maintaining Regulatory Approval for the Product in the Field in the Territory. 14.3 Accrued Rights. Termination or expiration of this Agreement for any reason will be without prejudice to any rights that will have accrued tothe benefit of a Party prior to the effective date of such termination. Such termination will not relieve a Party from obligations that are expressly indicated tosurvive the termination or expiration of this Agreement. 14.4 Survival. Notwithstanding anything to the contrary contained herein, the following provisions shall survive any expiration or termination ofthis Agreement: Articles: ARTICLE 11, 12, 14 (and Sections 8.9 and 8.10 with respect to payments due thereunder), 15 and ARTICLE 16 and Sections: 6.5.7,8.11, 9.1. Except as set forth in this ARTICLE 14 or otherwise expressly set forth herein, upon termination or expiration of this Agreement all other rights andobligations of the Parties shall cease. 14.5 Rights in Bankruptcy. All rights and licenses granted under or pursuant to this Agreement by VBL and Licensee are, and shall otherwise bedeemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code (and of any similar provisions of Applicable Laws under any other jurisdiction),licenses of right to “intellectual property” as defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that each Party, as licensee of certainrights under this Agreement, shall retain and may fully exercise all of its rights and elections under the U.S. Bankruptcy Code and under any similarprovisions of Applicable Laws under any other jurisdiction. The Parties further agree that, in the event of the commencement of a bankruptcy proceeding byor against a Party (such Party, the “Bankrupt Party”) under the U.S. Bankruptcy Code or under any similar provisions of Applicable Laws under any otherjurisdiction, (a) the other Party shall be entitled to a complete duplicate of (or complete access to, as appropriate) any intellectual property licensed to suchother Party and all embodiments of such intellectual property, which, if not already in such other Party’s possession, shall be promptly delivered to it (x)upon any such commencement of a bankruptcy proceeding upon such other Party’s written request therefor, unless the Bankrupt Party elects to continue toperform all of its obligations under this Agreement or (y) if not delivered under clause (x), following the rejection of this Agreement by the Bankrupt Partyupon written request therefor by the other Party and (b) the Bankrupt Party shall not unreasonably interfere with the other Party’s rights to intellectualproperty and all embodiments of intellectual property, and shall assist and not unreasonably interfere with the other Party in obtaining intellectual propertyand all embodiments of intellectual property from another entity. The “embodiments” of intellectual property includes all tangible, intangible, electronic orother embodiments of rights and licenses hereunder, including all compounds and products embodying intellectual property, Products, filings withRegulatory Authorities and related rights and VBL Know-How in the case that VBL is the Bankrupt Party and Licensee Know-How in the case Licensee is theBankrupt Party. 71CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 15DISPUTE RESOLUTION 15.1 Disputes. The Parties recognize that, from time to time during the Term, disputes may arise as to certain matters which relate to either Party’srights and/or obligations hereunder. It is the objective of the Parties to establish procedures to facilitate the resolution of disputes arising under thisAgreement in an expedient manner by mutual cooperation and without resort to litigation. To accomplish this objective, the Parties agree to follow theprocedures set forth in this ARTICLE 15 to resolve any controversy or claim arising out of, relating to or in connection with any provision of this Agreement(other than a dispute addressed in Section 3.1.6). 15.2 Arising Between the Parties. With respect to all disputes arising between the Parties and not from the JMC, including any alleged failure toperform, or breach, of this Agreement, or any issue relating to the interpretation or application of this Agreement, if the Parties are unable to resolve suchdispute within thirty (30) days after such dispute is first identified by either Party in writing to the other, the Parties shall refer such dispute to the ChiefExecutive Officers of each of the Parties, or a designee from senior management with decision-making authority (the Chief Executive Officer or suchdesignee, the “Executive Officer”) for attempted resolution by good-faith negotiations within thirty (30) days after such notice is received by the ExecutiveOfficers of each of the Parties. 15.3 Dispute Resolutions. If the Executive Officers are not able to resolve such dispute referred to them under Section 15.2 within such thirty (30)day period, then either Party shall have right to refer such dispute for binding arbitration administered in New York, New York in accordance with the Rulesof Arbitration of the International Chamber of Commerce (the “ICC Rules”). The language of the arbitration shall be English. Any situation not expresslycovered by this Agreement shall be decided in accordance with the ICC Rules. Notwithstanding the foregoing, any dispute, controversy or claim relating tothe scope, validity, enforceability or infringement of any patent rights covering the manufacture, use or sale of any Product or of any trademark rights relatingto any Product shall be subject to Section 15.4 and not this Section 15.3. 15.3.1 Arbitrator. There shall be a single arbitrator, appointed in accordance with the ICC Rules. The arbitrator may, in the award, allocateall or part of the costs of the arbitration, including the fees of the arbitration and the reasonable attorneys’ fees of the prevailing Party. 15.3.2 Decision. A written decision shall be rendered by the arbitrators following a full comprehensive hearing, no later than twelve (12)months following the selection of the arbitrators as provided for in Section 15.3.1. 72CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 15.3.3 Award. Any award rendered by the arbitrators may be entered in any court having jurisdiction thereof. Such award shall be promptlypaid in Dollars free of any tax, deduction or offset; and any costs, fees or taxes incident to enforcing the award shall, to the maximum extent permitted byApplicable Laws, be charged against the Party resisting enforcement. Such award may include an appropriate allocation of the prevailing Party’s attorneys’fees. Each Party agrees to abide by the award rendered in any arbitration conducted pursuant to this Section 15.3. The award shall include interest from thedate of the award until paid in full, at a rate fixed by the arbitrators and the arbitrators may, in their discretion, award pre-judgment interest. With respect tomoney damages, nothing contained herein shall be construed to permit the arbitrators or any court or any other forum to award punitive or exemplarydamages. Pursuant to this Agreement, the Parties expressly waive any claim for punitive or exemplary damages. 15.3.4 Costs. Except as set forth in Section 15.3.3, each Party shall bear its own legal fees. The arbitrators shall assess their costs, fees andexpenses against the Party losing the arbitration unless he or she believes that neither Party is the clear loser, in which case the arbitrators shall divide his orher fees, costs and expenses according to their sole discretion. 15.3.5 Injunctive Relief. Provided a Party has made a sufficient showing under the rules and standards set forth in Applicable Laws, thearbitrators shall have the freedom to invoke, and the Parties agree to abide by, injunctive measures after either Party submits in writing for arbitration claimsrequiring immediate relief. Additionally, nothing in this Section 15.3 will preclude either Party from seeking equitable relief or interim or provisional relieffrom a court of competent jurisdiction, including a temporary restraining order, preliminary injunction or other interim equitable relief, concerning a disputeeither prior to or during any arbitration if necessary to protect the interests of such Party or to preserve the status quo pending the arbitration proceeding. 15.3.6 Confidentiality. The arbitration proceeding shall be confidential and the arbitrators shall issue appropriate protective orders tosafeguard each Party’s Confidential Information. Except as required to comply with Applicable Laws, including rules and regulations promulgated by theU.S. Securities Exchange Commission, The NASDAQ Stock Market or any securities exchanges, no Party shall make (or instruct the arbitrators to make) anypublic announcement with respect to the proceedings or decision of the arbitrators without prior written consent of the other Party. The existence of anydispute submitted to arbitration, and the award, shall be kept in confidence by the Parties and the arbitrators, except as required in connection with theenforcement of such award or as otherwise required by Applicable Laws. 15.3.7 Survivability. Any duty to arbitrate under this Agreement shall remain in effect and be enforceable after termination of thisAgreement for any reason. 15.4 Patent and Trademark Dispute Resolution. Any dispute, controversy or claim relating to the scope, validity, enforceability or infringementof any patent rights covering the manufacture, use or sale of any Product or of any trademark rights relating to any Product shall be submitted to a court ofcompetent jurisdiction in the region in which such patent or trademark rights were granted or arose. 15.5 Injunctive Relief. Nothing herein may prevent either Party from seeking a preliminary injunction or temporary restraining order, in any courtof competent jurisdiction, so as to prevent any Confidential Information from being disclosed in violation of this Agreement. 73CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. ARTICLE 16MISCELLANEOUS 16.1 Entire Agreement; Amendment. This Agreement and all Schedules attached hereto shall constitute the entire agreement between the Partiesrelating to the subject matter hereof and thereof and shall supersede all previous writings and understandings including the Confidential DisclosureAgreement. No terms or provisions of this Agreement shall be varied or modified by any prior or subsequent statement, conduct or act of either of the Parties,except that the Parties may amend this Agreement by written instruments specifically referring to and executed in the same manner as this Agreement. 16.2 Force Majeure. If the performance of any part of this Agreement by either Party, or of any obligation under this Agreement, is prevented,restricted, interfered with or delayed by reason of a Force Majeure affecting the Party liable to perform, unless conclusive evidence to the contrary isprovided, the Party so affected shall, upon giving written notice to the other Party, be excused from such performance to the extent of such Force Majeure;provided, that the affected Party shall use its Commercially Reasonable Efforts to avoid or remove such causes of nonperformance and shall continueperformance with the utmost dispatch whenever such Force Majeure ceases. When such circumstances arise, the Parties shall discuss what, if any,modification of the terms of this Agreement may be required in order to arrive at an equitable solution. 16.3 Notices. Any notice, request, approval or other document required or permitted to be given under this Agreement shall be in writing and shallbe deemed to have been given when delivered in person, or sent by overnight courier service, postage prepaid, or sent by certified or registered mail, returnreceipt requested, or by facsimile transmission, to the following addresses of the Parties and to the attention of the persons identified below (or to such otheraddress, addresses or persons as may be specified from time to time in a written notice). Any notices given pursuant to this Agreement shall be deemed tohave been given and delivered upon the earlier of (a) if sent by overnight courier service, on the date when received at the address set forth below as provenby a written receipt from the delivery service verifying delivery, or (b) if sent by facsimile transmission, on the day when sent by facsimile as confirmed byautomatic transmission report coupled with overnight courier service receipt proving delivery, or (c) if delivered in person, on the date of delivery to theaddress set forth below as proven by written signature of the recipient. If to VBL: Attn: VP Business OperationsVBL Therapeutics8 Hasatat St., Modiin 7178106ISRAELFacsimile: +972-8-993-5001With a copy to: Attn: Chief Executive OfficerVBL Therapeutics8 Hasatat St., Modiin 7178106ISRAELFacsimile: +972-8-993-5001 74CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. If to Licensee:Attn: Director of Business DevelopmentNanoCarrier Co., Ltd.Ohnoya-Kyobashi Bldg.1-4-10 Kyobashi, Chuo-ku,Tokyo, 104-0031, JapanFacsimile: +81-3-3241-0554With a copy to:Attn: Chief Executive OfficerNanoCarrier Co., Ltd.Ohnoya-Kyobashi Bldg.1-4-10 Kyobashi, Chuo-ku,Tokyo, 104-0031, JapanFacsimile: +81-3-3241-0554 16.4 No Strict Construction; Interpretation. This Agreement has been prepared jointly and shall not be strictly construed against either Party.Ambiguities, if any, in this Agreement shall not be construed against any Party, irrespective of which Party may be deemed to have authored the ambiguousprovision. The headings of each Article and Section in this Agreement have been inserted for convenience of reference only and are not intended to limit orexpand on the meaning of the language contained in the particular Article or Section. 16.5 Assignment. Neither Party may assign or transfer this Agreement or any rights or obligations hereunder without the prior written consent ofthe other, except that each Party may make such assignment without the other Party’s consent to an Affiliate or a successor to all or substantially all of thebusiness of the assigning Party to which this Agreement relates; provided that in the case of an assignment by either Party, the assignee has sufficientresources and experience to carry out such assigning Party’s obligations hereunder and agrees to be bound by the provisions of this Agreement. Anypermitted assignment shall be binding on the successors of the assigning Party. Any assignment or attempted assignment by either Party in violation of theterms of this Section 16.5 shall be null, void and of no legal effect. 16.6 Severability. In the event that any portion of this Agreement is held illegal, void or ineffective, the remaining portions of this Agreementshall remain in full force and effect. If any of the terms or provisions of this Agreement are in conflict with any Applicable Laws, then such terms or provisionsshall be deemed to be modified to conform with such Applicable Laws to the extent necessary in order that such terms or provisions be valid and enforceableand such amendment shall apply only with respect to the operation of such terms or provisions in the particular jurisdiction in which such declaration ismade or, if such modification is not feasible, then such terms and provisions shall be deemed to be inoperative to the extent that such terms or provisionsconflict with Applicable Laws. In the event that the terms and conditions of this Agreement are materially altered as a result of this Section 16.6, the Partiesshall renegotiate the terms and conditions of this Agreement to resolve any inequities and to achieve the original intent of the Parties. 16.7 No Waiver of Breach. The failure of either Party at any time or times to require performance of any provision hereof shall in no manner affectits rights at a later time to enforce the same. No waiver by either Party of any condition or term in any one or more instances shall be construed as a further orcontinuing waiver of such condition or term or of another condition or term. 75CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 16.8 Partnership or Joint Venture. VBL and Licensee shall be independent contractors and the relationship between the Parties hereunder shallnot constitute a partnership, joint venture or agency. Neither VBL nor Licensee shall have the authority to make any statements, representations orcommitments of any kind, or to take any action, which shall be binding on the other, without the prior written consent of such other Party to do so. 16.9 English Language; Governing Law. This Agreement was prepared in the English language, which language shall govern the interpretationof, and any dispute regarding, the terms of this Agreement. All notices, reports and other documents contemplated by this Agreement to be delivered by aParty to the other Party shall be in the English language. This Agreement and all disputes arising out of or related to this Agreement or any breach hereofshall be governed by and construed under the laws of the State of New York, without giving effect to any choice of law principles that would require theapplication of the laws of a different jurisdiction. 16.10 Execution in Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but which togethershall constitute one and the same instrument. A facsimile or a portable document format (PDF) copy of this Agreement, including the signature pages, will bedeemed an original. [No Further Text on This Page] 76CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. IN WITNESS WHEREOF, the Parties, through their authorized representatives, have executed this Agreement as of the Effective Date. NanoCarrier Co., Ltd.Vascular Biogenics Ltd. By: By: Name:Ichiro Nakatomi, PhDName:Dror Harats, M.D.Title:President & CEOTitle:CEO [Signature Page to Development, Commercialization and Supply Agreement] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Schedule 1.78 VBL Patents I. Patents Patent No. Appl. No. Filing Date Grant Date Title (SKGF Ref No)[***] [***] [***] [***] [***][***] [***] [***] [***] [***][***] [***] [***] [***] [***][***] [***] [***] [***] [***][***] [***] [***] [***] [***][***] [***] [***] [***] [***] II. Application Appl. No. Filing Date Title[***] [***] [***][***] [***] [***] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Schedule 4.3.2 [***] [***] [***] [***][***] [***] [***] [***] [***][***] [***] [***][***] [***] [***][***] [***] [***] [***][***] [***] [***][***] [***] [***][***] [***] [***][***] [***] [***] [***] [***] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Schedule 12.5.1 Press Release VBL THERAPEUTICS AND NANOCARRIER CO., LTD SIGN EXCLUSIVE AGREEMENT FOR VB-111 IN JAPAN Agreement includes $15 million up front, potential milestones payments of more than $100 million, as well as tiered high-teen royalties NanoCarrier receives exclusive rights to VB-111 in Japan, VBLT retains rights in rest of world TEL AVIV, Israel, November 6, 2017 — VBL Therapeutics (Nasdaq: VBLT), a clinical-stage biotechnology company focused on the discovery,development and commercialization of first-in-class treatments for cancer, today announces an exclusive license agreement with NanoCarrier Co., Ltd. (TSEMothers: 4571) for the development, commercialization, and supply of ofranergene obadenovec (“VB-111”) in Japan. VBL Therapeutics (VBLT) retainsrights to VB-111 in the rest of the world. “Japan is potentially a large market opportunity for VBLT, and this agreement provides us with access into this important market as we continue to preparefor commercialization of VB-111 in recurrent glioblastoma (rGBM), and in other indications,” said Dror Harats, M.D., chief executive officer of VBLTherapeutics. “We see this agreement with NanoCarrier as providing further validation of the potential of VB-111 and we look forward to working together tobring this important anticancer therapy to patients and health care professionals in Japan.” “We are continually looking for new opportunities in the treatment of cancer, and VB-111 is an innovative gene therapy which, if approved, could havesignificant market potential in Japan,” said Ichiro Nakatomi, PhD., President and Chief Executive Officer of NanoCarrier. “VB-111 is a perfect fit for ourportfolio of cancer drug candidates.” Under terms of the agreement, VBLT has granted NanoCarrier an exclusive license to develop and commercialize VB-111 in Japan for all indications, VBLTwill supply NanoCarrier with VB-111, and NanoCarrier will be responsible for all regulatory and other clinical activities necessary for commercialization inJapan. In exchange, VBLT receives an up-front payment of $15 million, and is entitled to receive greater than $100 million in development and commercialmilestone payments. VBLT will also receive tiered royalties on net sales in the high-teens. Other terms of the agreement are not being disclosed. In addition to this agreement, VBL Therapeutics and NanoCarrier intend to explore future collaborations in oncology. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. About VB-111 (ofranergene obadenovec) VB-111, a potential first-in-class anticancer therapeutic candidate, is the Company’s lead product currently being studied in a global Phase 3 pivotal trial forrGBM. VB-111 has demonstrated statistically significant overall survival and a progression-free survival in a Phase 2 trial in patients with rGBM, versuscurrent standard of care. VBL-111 has received orphan drug designation in both the US and Europe, and fast track designation in the US for prolongation ofsurvival in patients with rGBM. In addition, VB-111 successfully demonstrated proof-of-concept and survival benefit in Phase 2 clinical trials in radioiodine-refractory thyroid cancer and recurrent platinum resistant ovarian cancer. About VBL Vascular Biogenics Ltd., operating as VBL Therapeutics, is a clinical stage biopharmaceutical company focused on the discovery, development andcommercialization of first-in-class treatments for cancer. The Company’s lead oncology product candidate, ofranergene obadenovec (VB-111), is a first-in-class biologic agent that uses a dual mechanism to target solid tumors. It utilizes an angiogenesis-specific sensor (VBL’s PPE-1-3x proprietary promoter) tospecifically target the tumor vasculature, by induction of cell death in angiogenic endothelial cells in the tumor milieu. Moreover, it is an immune-stimulantthat triggers a local anti-tumor immune response, which is accompanied by recruitment of CD8 T-cells and apoptosis of tumor cells. Ofranergene obadenovecis positioned to treat a wide range of solid tumors and is conveniently administered as an IV infusion once every two months. It has been observed to be well-tolerated in >300 cancer patients and we have observed its efficacy signals in an “all comers” Phase 1 trial as well as in three tumor-specific Phase 2 studies.Ofranergene obadenovec is currently being studied in a Phase 3 pivotal trial for rGBM, conducted under an FDA Special Protocol Assessment (SPA). Formore information, refer to: www.vblrx.com. About NanoCarrier Co., Ltd. NanoCarrier’s key business objective is to deliver new pharmaceuticals primarily in the area of cancer to society through our pioneer work of micellarnanoparticle technology as core technology developed based on nanotechnology, which originates in Japan. NanoCarrier is strongly committed to researchand development through which we strive to develop cutting-edge pharmaceuticals to meet the needs of many patients suffering from cancer. Conventionalanticancer agents show similar cytotoxic effects on cancerous and normal cells. The administration of these agents generally causes adverse reactions becauseit is distributed to the entire body, affecting normal cells as well. NanoCarrier’s pharmaceutical products, using the micellar nanoparticle technology, areexpected to wide therapeutic window of given such agent to accumulate more in cancerous lesions, thereby reducing drug distribution to normal cells, andreducing the occurrence of adverse reactions. It has been observed by ongoing Phase 1 trough Phase 3 clinical trials. For more information, refer tohttp://www.nanocarrier.co.jp/en/index.html. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Forward Looking Statements This press release contains forward-looking statements. All statements other than statements of historical fact are forward-looking statements, which are oftenindicated by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “goal,” “intend,” “look forward to”, “may,” “plan,” “potential,” “predict,”“project,” “should,” “will,” “would” and similar expressions. These forward-looking statements include, but are not limited to, statements regarding theclinical development and commercial potential of ofranergene obadenovec (VB-111) in Japan. These forward-looking statements are not promises orguarantees and involve substantial risks and uncertainties. Among the factors that could cause actual results to differ materially from those described orprojected herein include uncertainties associated generally with research and development, clinical trials and related regulatory reviews and approvals, andthe risk that historical clinical trial results may not be predictive of future trial results. In particular, results from our pivotal Phase 3 clinical trial ofofranergene obadenovec (VB-111) in rGBM may not support approval of ofranergene obadenovec for marketing in the United States or in Japan,notwithstanding the positive results seen in prior clinical trials. A further list and description of these risks, uncertainties and other risks can be found in theCompany’s regulatory filings with the U.S. Securities and Exchange Commission, including in our annual report on Form 20-F for the year ended December31, 2016. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the datehereof. VBL Therapeutics undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information,future events or circumstances or otherwise. VBL INVESTOR CONTACT:Michael RiceLifeSci Advisors, LLCmrice@lifesciadvisors.com(646) 597-6979 VBL MEDIA CONTACT:Matt Middleman, M.D.LifeSci Public Relationsmatt@lifescipublicrelations.com(646) 627-8384 NANOCARRIER CONTACT:Tetsuhito MatsuyamaCFO and Head of CEO’s Officeinfo@nanocarrier.co.jp   CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CONFIDENTIAL CLINICAL TRIAL SERVICES AGREEMENT Sponsor: Vascular Biogenics Ltd.Protocol: VB-111-701/GOG-3018Protocol Title: The OVAL study: A Randomized, Controlled, Double-Arm, Open-Label, Multi-Center Study of Ofranergene Obadenovec (VB-111) Combinedwith Paclitaxel vs. Paclitaxel Monotherapy for the Treatment of Recurrent Platinum-Resistant Ovarian Cancer This Clinical Trial Services Agreement (“Agreement”) is between Vascular Biogenics Ltd. (“Sponsor”), and the GOG Foundation, Inc. (“GOG”), anot-for-profit corporation organized under the laws of the District of Columbia, to conduct the Clinical Trial according to the protocol attached as Exhibit A(“Protocol”) and incorporated by reference into this Agreement. 1.Definitions. The following terms, when capitalized, shall have the following meanings as used in this Agreement: A.“Applicable Law” means all international and United States federal, state and local laws, rules, regulations, requirements, guidelines and policiesthat govern or apply to the conduct of the Clinical Trial (as defined below), including without limitation the Federal Food Drug and Cosmetic Actand related regulations, including 21 CFR Parts 11, 50, 54, 56 and 312; Guideline for Good Clinical Practice (“GCP”) adopted by the InternationalConference on Harmonization (ICH GCP”) of Technical Requirements for Registration of Pharmaceuticals for Human Use, as ratified by the FDA tothe extent applicable for this type of project and to the extent ICH GCP guidelines conform to the FDA GCP, and state and federal privacy laws,including the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) and the regulations promulgated thereunder; the FalseClaims Act (31 U.S.C. §§3729- 3733) (“FCA”); the Anti-Kickback Statute (42 U.S.C. §1320a-7b(b)); and the Physician Self-Referral Law (a.k.a.Stark Law, 42 U.S.C. §1395nn), as any of the foregoing may be amended from time to time. B.“Case Report Form” (“CRF”) means the case history and/or individual research record created and maintained for each Enrolled Participant in theClinical Trial, as required by FDA regulations. C.“Clinical Investigators” means the physicians at the Participating Institutions participating in the conduct of the Clinical Trial, each of which is an‘investigator’ (as described in 21 CFR §312.3(b)) for the conduct of the Clinical Trial at such physician’s Participating Institution. D.“Clinical Trial” means that certain clinical trial of the Study Drug to be performed by GOG through one or more Participating Institutions, asdescribed in the Protocol. E.“Clinical Trial Agreement” (“CTA”) means the agreement between the GOG and each Participating Institution and Clinical Investigator, asapplicable, for performance of the Clinical Trial, the template for which is attached hereto as Exhibit C and incorporated herein by this reference. F.“Eligible Patient” means a patient who meets the enrollment criteria set forth in the Protocol. G.“Enrolled Participant” means an Eligible Patient who has consented to participate and has been enrolled in the Clinical Trial. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. H.“FDA” means the United States Food and Drug Administration or any successor agency thereto. I.“Intentionally Omitted.” J.“IND” means an investigational new drug application submitted to the FDA. K.“IRB” means an Institutional Review Board constituted and operating in accordance with FDA regulations. L.“Participating Institutions” means the locations within the GOG system at which the Clinical Trial will be conducted, including the ClinicalInvestigators and the employees engaged by the Participating Institutions in the Clinical Trial. M.“Patient Informed Consent” means a form of document describing the Clinical Trial and its reasonable risks, which addresses all matters customarilyaddressed in patient informed consents appropriate to clinical trials of this type, includes an authorization by the patient to share with Sponsor allpatient data required for performance of the Clinical Trial and the preparation of all regulatory submissions, and complies, at a minimum, with therequirements set forth in FDA regulations, including without limitation 21 CFR §§50.20, 50.25, 50.27, and any successor provisions. N.“Study Drug” means Ofranergene Obadenovec (VB-111), produced by Sponsor or on its behalf in compliance with all applicable laws andregulations, including FDA regulations, to be supplied by Sponsor to the Participating Institutions for the sole purpose of conducting the ClinicalTrial, as provided in the Protocol. 2CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 2.Engagement to Perform Clinical Trial Services; Responsibility for Participating Institutions. A.Sponsor hereby engages GOG to provide, and GOG hereby agrees to provide, the Clinical Trial management and other services described herein, inaccordance with the Task and Responsibilities Table attached hereto as Exhibit B, and in accordance with the attached Protocol (collectively, the“Services”), in accordance with the terms and conditions set forth in this Agreement, with respect to the Clinical Trial, the Applicable Law and theinstructions of Sponsor, from time to time. B.GOG hereby represents and warrants that it has the lawful authority to contractually bind the Participating Institutions and Clinical Investigators, tothe material terms and conditions of this Agreement in connection with their respective performance of the Clinical Trial on behalf of GOG andSponsor. In addition, and notwithstanding anything to the contrary in this Agreement, GOG shall contractually require that the ParticipatingInstitutions and Clinical Investigators assisting with the Clinical Trial comply, inter alia, with Section 4 hereof and all other relevant provisions ofthis Agreement. In the event any material terms and conditions of an agreement between GOG and a Participating Institution for performance of theClinical Trial, or other material obligations according to the Agreement (including, without limitation, Confidentiality, Publication, Patent andInvention, Insurance and Indemnification) conflict with the terms of the CTA, Sponsor shall be consulted and if written consent is not obtained fromSponsor, the terms of this Agreement shall prevail. GOG shall cause Sponsor to be a third-party beneficiary of each CTA entered into with aParticipating Institution. C.In the event that GOG subcontracts part of the Services to a third party, GOG shall be responsible and retain primary liability for the performance ofall obligations of third party selected, managed and contracted by GOG. 4.Duties of Participating Institutions and Clinical Investigators. As part of GOG’s performance of the Services, GOG shall contractually require that: A.Participating Institutions conduct the Clinical Trial in accordance with the Protocol and all applicable laws, regulations, and good clinical andresearch practices and according the Sponsor approved CTA; B.Unless Sponsor approves in writing a deviation from the Exhibit C template, Participating Institutions shall, as required, perform the responsibilitiesassociated with the conduct and management of the Clinical Trial contained in the Exhibit “C” CTA template. C.Participating Institutions submit completed CRFs according to Protocol requirements; 3CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 5.Period of Performance. This Agreement shall become effective on the date last signed below (“Effective Date”) and (unless terminated earlier pursuant to Section 13 below) shallcontinue in force until Sponsor receives all Data, including completed case histories and CRFs for all Enrolled Participants in the Clinical Trial,questions about data submitted have been resolved, the database has been locked, and the final study report provided to and accepted by Sponsor. 6.Duties of Sponsor; Compensation of GOG; Changes to Services. A.Sponsor shall (i) be the regulatory sponsor of the Clinical Trial in accordance with FDA regulations, and meet the obligations of a sponsor undersuch regulations or applicable law, except to the extent expressly delegated to GOG hereunder, (ii) provide Participating Institutions without charge,properly formulated i n a c c o r d a n c e w i t h G MP and acceptably labeled Study Drug in a timely manner and in sufficient quantity to completethe Protocol, and (iii) provide GOG with the Investigator’s Brochure, and any amendments and/or updates to the Investigator’s Brochure for theStudy Drug. With prior written notice to GOG, Sponsor may entrust third party vendors in performing some of its tasks according to the Agreement. B.In consideration of and as payment in full for the Services rendered under this Agreement by GOG and performance of the Clinical Trial by theParticipating Institutions, Sponsor shall pay GOG in accordance with the Exhibit D Budget which is incorporated herein by reference. C.Changes to Services. The timelines, fees and expenses specified in this CTSA with respect to Services are subject to the assumptions outlinedtherein. In addition, the timelines, fees and expenses estimates assume that: (i) the scope of Services remains constant; (ii.) the parties reasonablyexecute all of their obligations under this CTSA; and (iii.) third parties timely and reasonably perform all relevant tasks to this CTSA. In the event ofa material change to the above assumptions, the parties shall confer in good faith to negotiate and sign a formal Change Order to this CTSA. Aformal Change Order shall be prepared by the parties and shall provide a written description of the changes to the Services and an estimate, if any, ofthe cost consequences, higher or lower, arising from the change. GOG shall continue to provide Services as called for in the executed CTSA pendingapproval of the formal Change Order by Sponsor. If the parties cannot agree on such changes, GOG shall not be obligated to implement the changesin the proposed Change Order. 4CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.Confidential Information. A.“Confidential Information” means all p r o p r i e t a r y , t r a d e s e c r e t a n d / o r c o n f i d e n t i a l information, including the Study Drug, thatSponsor or a third party on its behalf, provides to GOG or the Participating Institutions and information that GOG provides to the ParticipatingInstitutions, including Clinical Investigators, on behalf of Sponsor, whether disclosed prior to or during the Term of this Agreement or developedand/or discovered by GOG or the Participating Institutions, as a result of the performance of the Clinical Trial or required during this Agreement andthe CTA and any deliverables under this Agreement or the CTA including un-published Data and Study results, any analysis which are not a part ofthe Protocol, or using Sponsor- disclosed Confidential Information, which is (i) in writing or other tangible or electronic medium and designated“confidential” or otherwise marked with indicia of its confidential nature; (ii) orally disclosed and not previously reduced to a tangible medium,provided that Sponsor shall use reasonable efforts to identify such information as “confidential” at the time of disclosure and thereafter summarizesuch information in writing or reduce it to a tangible medium within thirty (30) days of disclosure; or (iii) the foregoing notwithstanding, disclosedby Sponsor or on behalf of Sponsor and which a reasonable person would understand to be confidential or proprietary in nature, including, withoutlimitation, the Protocol, Investigator’s Brochure and any regulatory documents. GOG acknowledges and understands that Sponsor is a publiccompany traded on the NASDAQ, and accordingly, the Confidential Information may be considered as “inside information” pursuant to securitieslaws and regulations. B.Notwithstanding any designation by Sponsor, “Confidential Information” shall not include information which the receiving party can demonstratethat: (i) is or becomes publicly known or available through no fault of GOG, or Participating Institutions; (ii) Sponsor has made available to third-parties without a confidentiality obligation; (iii) is already independently known to GOG, or Participating Institutions, as shown by their prior written records except for information concerningthe Clinical Trial that was created in collaboration with the Sponsor or in view of this Agreement or prior thereto; and/or (iv) is publicly- available that relates to potential hazards or warnings associated with the production, handling, or use of the Study Drug. 5CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. GOG shall not, and shall require that the Participating Institutions: (i) not disclose, and cause their respective employees and agents not to disclose,the Confidential Information to any third party without the prior written permission of Sponsor except as permitted by this Agreement; (ii) not usethe Confidential Information for any purpose other than the conduct of the Clinical Trial; (iii) restrict the dissemination of the ConfidentialInformation with its organization to only those persons who have a need to know, shall ensure that all of its directors, officers, employees, agents,representatives and advisors (collectively, “Associates”) are aware of this Agreement and bound by terms of confidentiality no less stringent thanthose stated herein and shall remain liable at all time for the compliance of the confidentiality obligations of such Associates. C.In the event that GOG or a Participating Institution or their employees and agents reasonably find it necessary to disclose any ConfidentialInformation to a governmental authority to defend the research against an allegation of fraud or other misconduct, or to defend themselves in anyother legal proceeding, or are required by applicable law or medical duty to disclose Confidential Information, the party may make the necessarydisclosure after providing reasonable prior notice to Sponsor, and attempting in good faith to agree upon a mutually satisfactory way to discloseonly such portions of the Confidential Information as is necessary to achieve this limited purpose. In the event disclosure is required under thissection, after reasonable notice has been provided to the Sponsor, the GOG and/or Participating Institution with whom the request for ConfidentialInformation has been made agrees to fully cooperate at Sponsor’s sole cost and expense with Sponsor should Sponsor seek a protective order, orother legal remedy to limit the disclosure of such Confidential Information. D.GOG or a Participating Institutions may publishing or otherwise publicly disclose data generated from the Clinical Trial as provided in Sections 8and 9, below. E.The obligations of this Section 7 shall survive the expiration or termination of this Agreement. 8.Recordkeeping and Access to Data. A.As part of the Services, GOG shall contractually require that: (i) Participating Institutions complete and maintain customary accurate and authentic records and clinical trial documentation, including withoutlimitation signed consent forms, clinical data, CRFs, case histories, notes, accounts, and adverse event and Serious Adverse Event reports of the workperformed under this Agreement (“Data”); (ii) Sponsor and authorized agents of FDA, United States Department of Health and Human Services (“HHS”), and other federal agencies shall havethe right to inspect and review such Data at the Participating Institutions to the extent permitted by law and during regular business hours and uponreasonable notice; 6CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Participating Institutions maintain confidentiality of personally identifiable information concerning Enrolled Participants, andshall disclose suchinformation to third parties only as permitted by applicable state and Federal privacy laws, including (but not limited to) the Health InsurancePortability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act (“HIPAA”).All Data provided by GOG to Sponsor with respect to Enrolled Participants shall be furnished without patient names. In the event either GOG orSponsor is exposed to a patients’ personally identifiable information (including medical records and other health information), GOG and Sponsorshall comply with Applicable Law regarding access to, confidentiality of, and security of such information and shall act in accordance with theInformed Consent and HIPAA authorization signed by the Enrolled Participant. B.The Study Drug and all Data generated or required by the Clinical Trial are and shall remain the property of Sponsor. C.The Statistical and Data Management Center (SDMC) of GOG will provide data management and statistical services for this Study. Subject to anythird party licensing requirements, GOG shall provide Sponsor’s data management group sufficient information regarding the data managementsystem used for the Protocol, including without limitation Data Management Plan, database structure, annotated case report forms, data dictionaries,and data mapping, such that the Protocol data can be transferred and merged with other Sponsor data for the Study Drug. At mutually agreed uponspecified time points during the conduct of the Study, and at other time points which may be necessary based on Study requirements, GOG SDMCshall provide, interim datasets to support the independent Data Safety Committee and other agreed upon Sponsor requirements, including but notlimited to safety and efficacy data, to the Sponsor. 9.Publication and Other Public Presentation of Results. A.The Institution and Participating Institutions agree that the Sponsor shall have the right to the first publication of the results of the Study inaccordance with the terms of this Agreement. The Sponsor recognizes that, consistent with the principles of academic freedom, GOG requires thatParticipating Institutions be free to publish the results of their research activities after provision by GOG of the final study report to the Sponsor orand as otherwise agreed to in writing by the Sponsor. The Sponsor agrees that GOG and Participating Institutions engaged in this Clinical Trial shallbe permitted to publish reports in journals and other professional publications, and to present the methods and results of this Clinical Trial atsymposia and professional meetings (each, a “Publication”), in accordance with the requirements of this Section 9. Such publication by GOG andParticipating Institution may be no earlier than after a cooperative multi-center publication has been published by Sponsor. However, if a multi-center publication is not submitted after one (1) year from the date of completion or termination of the Study, or if Sponsor confirms there will be nomulti-center Study publication, GOG the Participating Institution may publish the Study results after providing Sponsor an opportunity to reviewand comment in accordance with the terms herein. 7CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. B.Sponsor shall be furnished a copy of any proposed Publication for advisory review at least sixty (60) days in advance of the submission of suchproposed Publication for journals and other professional publications and thirty (30) days for any other Publication, such as a poster presentation,abstract, or other written or oral material which describes the results of the Clinical Trial. Expedited review or additional review time may bearranged by mutual written agreement. Sponsor may remove from the proposed publication any information that is Confidential Information. C.If within such review period, Sponsor determines and notifies GOG in writing that the proposed Publication contains disclosures of the intellectualproperty of Sponsor, GOG shall require that the proposed Publication be delayed for up to an additional ninety (90) days in order to allow Sponsorsufficient time to take appropriate steps to preserve U.S. or foreign patent or other intellectual property rights. GOG shall require that ParticipatingInstitutions shall provide, at Sponsor’s sole cost and expense, any additional information in their possession which Sponsor deems necessary to filesuch patent application(s) or otherwise protect such intellectual property rights. Sponsor shall have three (3) months from its receipt of suchadditional information to file such patent application(s). GOG shall not and shall require that the Participating Institutions shall not submit theproposed Publication to anyone who is not employed by GOG or the Participating Institutions and under an obligation of non-disclosure and non-use at least substantially similar to that imposed on the Participating Institutions until each such patent application has been filed by Sponsor or theconclusion of the three (3) month period of this Paragraph, whichever occurs first, or until the information on the potentially patentable invention(s)is excised from the manuscript. D.GOG shall have no ownership rights or copyright in any publications or presentations prepared by Sponsor in the performance of this Agreement. 10.Use of Names. Neither GOG nor Sponsor shall use the name, symbols and/or marks of the other in connection with the Clinical Trial without prior written permissionfrom the other party. Such permission is not required for disclosure of the existence of the Agreement in reports generated in the normal course ofbusiness by GOG or Sponsor, or where acknowledgment of sponsorship is required by the guidelines of a scientific publication or organization, or thefact that GOG is conducting the Clinical Trial in disclosures made by Sponsor in the normal course of business, or where required by regulatoryauthority, law or stock exchange rule. Neither party shall use, nor authorize others to use, the name, symbols, or marks of the other or any affiliate thereofin any advertising or publicity material or make any form of representation or statement in relation to the Clinical Trial that would constitute an expressor implied endorsement by the other party of any commercial product or service, without prior written approval from the other party. None of theforegoing in this Section 10 shall restrict Sponsor from disclosing factual information regarding Sponsor’s relationship with GOG or the Clinical Trial orthe terms of this Agreement to prospective investors or sublicensees in the normal course of its business relating to the Study Drug. 8CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 11.Patents and Inventions. A.Sponsor Inventions. Any New Inventions (whether patentable or not), innovations, suggestions, ideas and reports arising out of or in connectionwith the Study Drug or Sponsor’s Confidential Information by GOG and/or any Participating Institution or the contractors of any of the foregoing,shall be promptly disclosed to Sponsor, and shall be the exclusive property of Sponsor (“Sponsor Inventions”). Upon Sponsor’s request, and atSponsor’s sole expense, Participating Institutions and GOG shall take all reasonable actions necessary or appropriate to obtain patent or otherproprietary protection in Sponsor’s name with respect to any of the Sponsor Inventions. Subject to the terms and conditions of this Agreement,Sponsor hereby grants GOG a non-exclusive, non-transferable license to use the Sponsor’s Study Drug for the sole and limited purpose of grantingsublicenses to Participating Institutions pursuant to the CTA, as attached hereto, to the extent required for Participating Institutions to carry out theClinical Trial in compliance with the Protocol. Sponsor hereby grants to GOG a non-exclusive, royalty free limited license to all Sponsor Inventionsfor all non-commercial academic research, subject to Sponsor’s confidentiality and publications rights. B.“New Invention(s)” shall mean any invention or discovery conceived reduced to practice, or otherwise discovered or developed, in whole or in part,by Sponsor, GOG, any Participating Institution or the contractors of any of the foregoing, based on or resulting from performance of the ClinicalTrial. As used in this Section 11, the term “conceived” shall have the same definition of “conception” as set forth in section 2138.04 of the UnitedStates Patent and Trademark Office’s Manual of Patent Examining Procedure, Eighth Edition, Latest Revision July 2010. C.The right of publication by GOG and Participating Institutions, as described in Section 9, shall not be affected by a license to use any NewInvention. Sponsor has no obligation or commitment to enter into any patent license or other agreement with GOG relating to the subject matterhereof. 9CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. D.Background IP. Existing inventions, ideas, discoveries, technologies, methodologies and other intellectual property of each party that wereconceived, reduced to practice, or otherwise discovered or developed before the Effective Date (“Background IP”) are their separate property,whether protected by patent or other intellectual property rights, and except as expressly provided in Section 11(A), are not affected by thisAgreement. Neither party shall have any claims to or rights in any such inventions, ideas, discoveries or methodologies of the other party. 12.Insurance and Indemnification. A.Each party states that it maintains a policy or program of insurance or self-insurance in accordance with industry standards or otherwise as requiredby law. Upon request, each party shall provide the other with evidence of its insurance or self-insurance coverage, and unless self- insured, willnotify the other party within three (3) business days of notice of any reduction, non-renewal or cancellation of its coverage. GOG shall contractuallyrequire Participating Institutions a n d C l i n i c a l I n v e s t i g a t o r s to maintain a policy or program of insurance of self-insurance in full forceand effect, throughout the performance of the Clinical Trial that covers: (a) employer’s liability; (b) general liability; (c) contractual liability; (d)premises liability; (e) professional medical and nursing indemnity in amounts adequate to cover its obligations hereunder and in accordance withindustry standards or as otherwise required by law. B.Sponsor shall defend, indemnify and hold harmless the GOG, the Participating Institutions and their respective directors, officers, employees andagents (each, a “Sponsor Indemnitee”, and collectively, the “Sponsor lndemnitees”) against any liability, damage, loss or expense (“Losses”)incurred by, imposed on or alleged against any Sponsor Indemnitee in connection with any third party claims, suits, actions, demands or judgments to t h e e x t e n t arising out of (a) any side effect, adverse reaction, illness of injury occurring to any Enrolled Participant as a result of his or herinvolvement in the Clinical Trial’s non-standard of care activities or (b) any breach or alleged breach of this Agreement by Sponsor; (c) negligenceor intentional misconduct by Sponsor; provided that the amount of such Losses shall be reduced by an amount in proportion to the percentage ofresponsibility of GOG or any third party for such Losses. Sponsor’s indemnification hereunder shall not apply to any liability, damage, loss or expense incurred by any Sponsor Indemnitee to the extentdirectly attributable to: (v) the willful, reckless or negligent acts or omissions, or professional malpractice of such Sponsor Indemnitee, (w) failure ofsuch Sponsor Indemnitee to adhere strictly to the terms of the Protocol good clinical practices, FDA or other government requirements or law (asapplicable) or any other written instructions received from Sponsor and/or GOG, provided, however, that emergency medical care reasonablynecessary to protect the safety, rights or welfare of an Enrolled Participant shall not be deemed a violation of the Protocol, (x) failure of any SponsorIndemnitee to materially comply with applicable laws, rules, regulations or guidance, 10CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (y) failure to comply with Sponsor’s written recommendations or instructions relative to use of the Study Drug, or (z) any other material breach ofthis Agreement by the GOG or material breach of the CTA by the Participating Institution. GOG shall indemnify, defend and hold harmless Sponsor and its Associates (“GOG Indemnitee”) from and against any and all damages, liabilities,losses, fines, penalties, settlement amounts, cost and expenses of any kind or nature whatsoever, including, without limitation, reasonable attorney’sfees, expert witnesses and court costs, incurred in connection with any claim, but only to the extent arising from the negligence, intentionalmisconduct, or material breach of Agreement of GOG or its Associates; provided however, that GOG shall have no obligation of indemnityhereunder with respect to any claim which arose from the negligence act error or omission, intentional misconduct or material breach of Agreementon the part of Sponsor or its Associates. Each party’s obligation to indemnify the lndemnitees hereunder (“Indemnifying Party”) shall apply only if such Indemnitee provides promptnotification upon receipt of any claim or suit, permits Indemnifying Party and its attorneys and personnel to handle and control the defense of suchclaims or suits, including but not limited to a l l d e c i s i o n s r e l a t i v e t o pretrial, trial, appeal or settlement, and the Indemnitee fully cooperatesand assists in such defense (including access to pertinent records and documents and provision of relevant testimony). In no event shall anyIndemnitee seeking to be indemnified under this Agreement settle any claim or action without the prior express written approval of IndemnifyingParty, which shall not be unreasonably withheld. Subject to the foregoing, each Indemnitee may participate in any such claims at its, his, or her owncost and expense. C.Sponsor’s agreement to indemnify, defend and hold an Indemnitees harmless pursuant to this Section is condition upon Indemnitees obtaining: (i)informed consent from each of the subjects participating in the Clinical Trial, in compliance with 21 CFR, Part 50; and (ii) IRB review and approvalfor the Clinical Trial in compliance with 21 CFR, Part 56. D.Except for the parties above Article 12 Indemnification obligations, neither party shall be liable to the other party for any incidental, indirect,special or consequential losses or damages (including loss of profits), whether in contract or tort. 11CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 13.Termination. A.This Agreement will terminate automatically if any of the following occur: (i) if FDA imposes a permanent hold on the Study Drug; (ii) if the Clinical Trial is terminated by Sponsor for reasons of patient safety; or (iii) if a formal investigation by an authorized governmental agency finally determines that the Data have been falsified or irreparably compromisedby research misconduct. B.This Agreement may be terminated by either party, upon thirty (30) days prior written notice, if either party fails to materially comply with the termsof this Agreement after receipt of written notice, with reasonable opportunity to cure, from the other party. C.This Agreement may be terminated by Sponsor upon thirty (30) days prior written notice to GOG if it reasonably determines that patient safetyrequires termination. This Agreement may be terminated by Sponsor for any reason upon thirty (30) days prior written notice to GOG. Provided,however, Sponsor may suspend the Clinical Trial at any time for any reason. The suspension of the Clinical Trial by Sponsor for any reason shall notbe deemed a material breach of this Agreement and shall be supported by a written statement explaining the reason for suspension. D.Upon the effective date of termination, there shall begin an accounting conducted by GOG. Within sixty (60) days after receipt of adequatedocumentation describing in reasonable detail (including reasonable itemization) the services rendered and moneys expended by GOG, Sponsorshall make payment to GOG, on a pro rata basis, for all undisputed amounts representing: (i)all services properly rendered and monies properly expended by GOG or a Participating Institution under this Agreement prior to the date oftermination, and not yet reimbursed;and 12CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. (ii)all reasonable non- cancelable obligations properly incurred for the Clinical Trial by GOG prior to the effective date of termination; unless theSponsor objects to any charge, in which case, the parties shall use best efforts to resolve expeditiously any disagreement. In the event ofdisagreement, Sponsor shall not withhold any amounts not in dispute and shall make payment thereof as required in this Section 13. E.GOG shall return to the Sponsor any portion of the Sponsor funds not properly expended or obligated by GOG or Participating Institutions inconnection with the Clinical Trial, in each case prior to the effective termination date indicated in the notice of termination or the date of automatictermination, if applicable. Further, GOG, Principal Investigator or the Participating Institutions, including the Clinical Investigators shall, withinthirty (30) days of the effective date of such termination or expiration, return any Confidential Information, provided, however, that one (1) archivalcopy of Sponsor’s Confidential Information may be retained solely for purposes of monitoring compliance with this Agreement. F.Upon the effective date of any termination or expiration of this Agreement, Sponsor shall, in collaboration with GOG and Sponsor’s designee, (i)notify the Participating Institutions that the Clinical Trial has been terminated, (ii) cease (and cause the Participating Institutions and ClinicalInvestigators to cease) enrolling further patients in the Clinical Trial, (iii) cease (and cause the Participating Institutions and Clinical Investigators tocease) treating Enrolled Participants according to the Protocol as directed by Sponsor to the extent medically permissible and appropriate, and (iv)terminate (and cause the Participating Institutions and Clinical Investigators to terminate) as soon as practicable, but in no event more than thirty(30) days after the effective date of termination, all other applicable Clinical Trial activities; provided however, that upon Sponsor’s request, GOGand Participating Institutions shall continue to collect Data and prepare and complete CRFs for Enrolled Participants treated in the terminatedClinical Trial prior to termination or expiration. Within one hundred twenty (120) days from the effective date of any termination, GOG shallprovide to Sponsor all Data. G.Expiration or termination of this Agreement for any reason shall not affect the rights and obligations of the parties accrued prior to the effective dateof such expiration or termination. The rights and duties as specified under Sections 2.8., 4 (C, D, F, G, I, J and K), 6 (B, C, D, and E, in each casesolely with respect to amounts accrued before expiration or termination), 7, 8, 9, 10, 11, 12, 13 (D, E, F, G, H) and 14 and any other provision that byits terms is intended to survive termination or expiration, shall survive the termination or expiration of this Agreement. 13CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. H.The parties shall cooperate with each other and with Federal agencies in winding down the Clinical Trial and, when appropriate, in transferring thecare of Enrolled Participants to suitably trained practitioners of their choice. 14.Miscellaneous. A.Independent Contractor. GOG, Participating Institutions and other research staff are independent contractors and are neither employees nor agentsof Sponsor. Neither GOG nor Sponsor intends to create any partnership, joint venture, employment or agency relationship pursuant to thisAgreement. Neither party to this Agreement shall have the right to bind the other party by contract or otherwise to transact business in the otherparty’s name or on its behalf, unless with the specific written consent of the other party. B.Correspondence. For purposes of medical/scientific communications email communication is expressly permitted. Sponsor shall address allmedical/scientific communications to the Study Chair at the address listed in the Protocol, and to GOG as follows: GOG Foundation, Inc. Four Penn Center, Suite 1020 1600 John F. Kennedy Boulevard Philadelphia, Pennsylvania 19103-2800 [***] [***] [***] [***] [***] C.Notices. Legal claim notices given to the respective parties hereunder shall be in writing and sent by facsimile or by registered or certified mail tothe following: 14CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. If to Sponsor: If to GOG:GOG Foundation, Inc. Four Penn Center, Suite 1020 1600 John F. Kennedy Boulevard Philadelphia, Pennsylvania 19103-2800 [***] [***] [***] [***] With a copy, which shall not constitute notice, to: [***] General Counsel GOG Foundation, Inc. 1600 John F. Kennedy Boulevard Philadelphia, PA 19103 Notices shall be deemed given when facsimile transmission or mail receipt is confirmed. D.Assignment. Due to the specialized nature of the services provided under this Agreement, neither party shall assign, transfer or convey thisAgreement without the other party’s prior written consent. Notwithstanding the foregoing, Sponsor may assign its rights under this Agreement (inwhole or in part, and to multiple assignees) without the prior written consent of GOG to any affiliate or other entity that controls, is controlled by oris under common control with Sponsor, or to a successor-in-interest in connection with a merger, acquisition, or sale of all or substantially all of itsassets, a licensee, or sublicensee of any of the assets of Sponsor to which this Agreement relates. This Agreement shall inure to the benefit of eachparty and its permitted successors and assigns. This Section 14.0 shall not be deemed to preclude GOG from contracting with Clinical Investigatorsand Participating Institutions to perform the Clinical Trial hereunder, or to require Sponsor to consent to such contracts, except as otherwisespecifically set forth above. 15CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. E.Amendment. Any amendment(s) to this Agreement must be in writing and signed by both parties. F.Governing Law. This Agreement shall be construed, governed and interpreted in accordance with the laws of the State of Delaware exclusive of anyconflict of law provisions. G.Alternative Dispute Resolution. The parties agree to submit any dispute arising hereunder to binding arbitration pursuant to the Rules of Arbitrationof the International Chamber of Commerce. The arbitration shall be conducted in New-York City, New York USA. The decision of the arbitrator shallbe final and binding upon the parties hereto and shall be enforceable by any court of competent jurisdiction. H.Entirety of Agreement. This Agreement constitutes the entire agreement between the parties concerning the subject matter herein, and supersedesall prior terms or understandings, written or oral. In the event of a conflict between the terms of this Agreement and the Protocol, this Agreementshall govern all legal and financial matters and the Protocol shall govern all clinical matters. I.Waiver. Neither the waiver by any of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure ofany of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder shallthereafter be construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver of any of such provisions, rights orprivileges hereunder. No waiver by a party hereto of, or consent by a party hereto to, a variation from any provision of this Agreement shall beeffective unless made in a written instrument duly executed on behalf of such party. J.Severability. The invalidity or unenforceability of any term or provision of this Agreement shall not affect the validity or enforceability of any otherterm of this Agreement. K.No Debarment. GOG represents and warrants that neither GOG nor Participating Institutions or Clinical Investigator or any of their employees oragents, rendering activities pursuant to this Agreement is presently debarred pursuant to the Generic Drug Enforcement Act of 1992, 21 U.S.C. §335a, or any other FDA authority. GOG shall notify Sponsor immediately upon the commencement of any such proceeding concerning GOG or anysuch person or entity. L.Inspections. If any governmental or regulatory authority conducts or gives notice to GOG of its intent with respect to any activities under thisAgreement to conduct an inspection, audit, or monitoring visit at GOG or any Participating Institution or take any other regulatory action, or if GOGbecomes aware of any such governmental inspection or other regulatory activity at GOG or one of the Participating Institutions, GOG shall promptlygive Sponsor and Sponsor’s designee notice thereof by telephone with follow-up notice provided in writing within forty-eight (48) hours of thetelephonic notification, including all information pertaining to any such inspections or actions, and GOG shall allow or cause the applicableParticipating Institution to allow Sponsor or its representatives or designee to be present at any such inspection or actions. GOG shall contractuallyrequire that any required response or action by any Participating Institution shall be made within two (2) weeks of issuance of any citations or withinany earlier deadline set by the issuing regulatory authority and shall make a good faith consideration any comments provided by Sponsor and/orSponsor’s designee on any proposed written response and provide Sponsor a n d Sponsor’s d e s i g n e e with a copy of any such written response. Inthe event the FDA or other regulatory authority requests or requires any action to be taken to address any citations, GOG shall provide Sponsor withwritten notice thereof and shall require that the Participating Institution, after consultation with GOG and Sponsor, take such action as necessary toaddress and correct such citations, and cooperate with Sponsor with respect to any such citation and/or action taken with respect thereto. 16CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. M.Sponsor audit at GOG facilities. GOG hereby give Sponsor and Sponsor’s designee permission to perform audits at GOG facilities. Sponsor willprovide at least four (4) weeks notice in writing, including scope of audit. N.No Sanctions. GOG hereby represents and warrants that neither GOG nor any of its personnel, nor to the knowledge of GOG any ParticipatingInstitution or the research staff of any have been or shall be involved in an investigation or in research that was terminated, as the term “termination”is used in 21 CFR 812.3(q), nor have they been subjected to any sanctions related to allegations of research or professional misconduct. O.Additional Actions and Documents. Each of the parties hereto hereby agrees to take or cause to be taken such further actions, to execute, deliver andfile or cause to be executed, delivered and filed such further documents and instruments, and to obtain such consents, as may be necessary or as maybe reasonably requested in order to fully effectuate the purposes, terms and conditions of this Agreement. 0.Authority of the Parties. The Parties hereby represent and warrant that they have the legal authority to enter into this Agreement and that the termsof this Agreement are not inconsistent with their other contractual arrangements. P.“Intentionally Omitted.” Q.Counterparts. To facilitate execution, this Agreement may be executed in as many counterparts as may be required. It shall not be necessary that thesignature of or on behalf of each party appears on each counterpart, but it shall be sufficient that the signature of or on behalf of each party appearson one or more of the counterparts. All counterparts shall collectively constitute a single agreement. It shall not be necessary in any proof of thisAgreement to produce or account for more than a number of counterparts containing the respective signatures of or on behalf of all of the parties.Any signature provided by facsimile or electronic image transmission shall be binding to the same extent as an original signature page. 17CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. R.Headings. The headings of this Agreement are for ease of reference only and shall not limit or otherwise affect the meaning of the terms andconditions of this Agreement. The Parties hereby accept and agree to the terms and conditions of this Agreement. Vascular Biogenics Ltd.: GOG FOUNDATION INC.: By: By: Name: Name: Title: Title: Date: Date: 18CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. EXHIBIT A [Protocol insert] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. EXHIBIT C CLINICAL TRIAL AGREEMENT This Clinical Trial Agreement (“Agreement”) is between the GOG Foundation, Inc. (“GOG”), a not-for-profit corporation organized under the lawsof the District of Columbia, located at Four Penn Center, Suite 1020, 1600 John F. Kennedy Boulevard, Philadelphia, Pennsylvania 19103 and __(“Institution”) whose principal place of business is ____________________. This Agreement is effective as of the last date of signature below (the“Effective Date”). I.Definitions. The following terms, when capitalized, shall have the following meanings as used in this Agreement: A.“Applicable Law” means all United States federal, state and local laws, rules, regulations, requirements, guidelines and policies that governor apply to the conduct of the Clinical Trial (as defined below), including without limitation the Federal Food Drug and Cosmetic Act andrelated regulations, including 21 CFR Parts 11, 50, 54, 56 and 312; Guideline for Good Clinical Practice (“GCP”) adopted by theInternational Conference on Harmonization (ICH GCP”) of Technical Requirements for Registration of Pharmaceuticals for Human Use, asratified by the FDA to the extent applicable for this type of project and to the extent ICH GCP guidelines conform to the FDA GCP, andstate and federal privacy laws, including the Health Insurance Portability and Accountability Act of 1996, as amended by the HealthInformation Technology for Economic and Clinical Health Act (“HIPAA”) and the regulations promulgated thereunder; the False ClaimsAct (31 U.S.C. §§3729-3733) (“FCA”); the Anti-Kickback Statute (42 U.S.C. §1320a-7b(b)); and the Physician Self- Referral Law (a.k.a.Stark Law, 42 U.S.C. §1395nn), as any of the foregoing may be amended from time to time. B.“Case Report Form” (“CRF”) means the case history and/or individual research record created and maintained for each EnrolledParticipant in the Clinical Trial, as required by FDA regulations. C.“Clinical Trial” means the performance of the clinical trial conducted in accordance with the Protocol (defined below). D.“Data” means customary accurate and authentic records and clinical trial documentation, including without limitation signed consentforms, clinical data, CRFs, case histories, notes, accounts, and adverse event reports created for the Clinical Trial excluding original sourcemedical records. E.“Eligible Patient” means a patient who meets the enrollment criteria set forth in the Protocol. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. F.“Enrolled Participant” means an Eligible Patient who has consented to participate and has been enrolled in the Clinical Trial. G.“FDA” means the United States Food and Drug Administration or any successor agency thereto. H. “Intentionally Omitted.” I.“IND” means an investigational new drug application submitted to the FDA. J.“Investigator” means the properly licensed medical doctor employed or contracted by or affiliated with the Institution who is responsiblefor performance of the Clinical Trial at the Institution. K.“IRB” means the Institution’s Institutional Review Board constituted and operating in accordance with 21 CFR Part 56 and any otherapplicable FDA/HHS regulations. L.“Patient Informed Consent” means a form of document describing the Clinical Trial and its reasonable risks, which addresses all matterscustomarily addressed in patient informed consents appropriate to clinical trials of this type, includes an authorization by the patient toshare with GOG, Sponsor and/or sponsor’s designee all patient data required for performance of the Clinical Trial and the preparation of allregulatory submissions, and complies, at a minimum, with the requirements set forth in FDA regulations, including without limitation 21CFR §§50.20, 50.25, 50.27, and any successor provisions. M.“Protocol” means the protocol titled, “The OVAL Study: A Randomized, Controlled, Double-Arm, Open-Label, Multi-Center Study ofOfranergene Obadenovec (VB-111) Combined with Paclitaxel vs. Paclitaxel Monotherpay for the Treatment of Recurrent Plantinum-Resistant Ovarian Cancer,” attached as Exhibit A, including any amendments thereto. N.“Sponsor” means Vascular Biogenics Ltd. and is an intended third-party beneficiary of this Agreement. O.“Study Drug” means Ofranergene Obadenovec (VB-111). CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. II.Performance of Clinical Trial. A.Investigator. The Institution, Sponsor, Sponsor’s designee and GOG have agreed that _ ___ is the Investigator at Institution. Institutionrepresents that Investigator holds the necessary professional license and has the necessary expertise, time and resources to perform theClinical Trial and will ensure that Investigator is made aware of and acknowledges the obligations applicable to the Investigator set forth inthis Agreement. Institution, Investigator, or both, shall provide all support personnel needed to conduct the Clinical Trial. In the eventInvestigator becomes either unwilling or unable to perform the duties required by this Agreement for any reason, Institution shall notifyGOG within a reasonable time (i.e., with enough notice to mitigate the circumstances) and propose a new investigator to GOG. If a mutually acceptable substitute is not available, this Agreement will automatically terminate; however, Institution shall continue toprovide follow-up care to Enrolled Participants per the Protocol and generally accepted standards of Good Clinical Practice. Any substituteInvestigator shall be required to agree in writing to the terms and conditions of this Agreement. B.IRB/Patient Informed Consent. Institution shall be responsible for obtaining and maintaining all IRB approvals required by ApplicableLaw for the conduct of the Clinical Trial. Institution shall keep Sponsor and/or Sponsor’s designee fully informed of the progress of IRBsubmissions and shall, upon request, provide Sponsor and/or Sponsor’s designee with all correspondence relating to such submissions.Institution shall use the “Informed Consent” template attached hereto as Exhibit B (the “ICF”) for the performance of this Clinical Trial.Institution shall not consent to any change in the Protocol or ICF requested by the IRB without the prior written consent of Sponsor and/orSponsor’s designee. Institution shall obtain and maintain a signed Patient Informed Consent (as approved by the IRB) for each EnrolledParticipant in the Clinical Trial at Institution, prior to performing any activities under the Protocol. Institution shall retain such consentforms for the length of time required by Applicable Law. C.Enrollment. Institution shall not enroll any Eligible Patients in the Clinical Trial until: (i) the Protocol has been approved by the IRB,and (ii) all applicable FDA approvals have been obtained. Institution acknowledges and agrees that Sponsor and/or Sponsor’s designeemay communicate directly with Investigator regarding recruitment and enrollment in the Clinical Trial. D.Conduct. Institution, under the guidance of Investigator, is responsible for the day-to-day supervision and control of the Clinical Trial andshall conduct the Clinical Trial in accordance with the Protocol, this Agreement, Applicable Law and current Good Clinical Practices. Inthe event of any conflict between the Protocol and the provisions of this Agreement, the Protocol shall govern with respect to clinicalissues, and the provisions of this Agreement shall govern with respect to all other issues. Institution shall maintain a file of all documentspertaining to the Protocol including, but not limited to, Protocol amendments and safety reports. Institution shall perform the following duties: ●Review and approve Clinical Trial Data collection forms CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Institution shall promptly notify Sponsor and/or Sponsor’s designee of any adverse reactions in the course of the Clinical Trial to enableSponsor to fulfill its drug safety reporting requirements. In the event of SAEs, Institution shall promptly and fully comply with allnotification procedures, time frames, and requirements stated in the Protocol, including completion of a Sponsor Serious Event Report form.Institution shall notify Sponsor’s designee within twenty-four (24) hours of first becoming aware of an SAE via the GOG SAE Portal.Institution shall comply with all FDA reporting requirements, including without limitation, the requirement for adverse event and SAEreporting in accordance with 21 CFR 312.64, and such other reporting requirements set forth under Applicable Law. Institution shall submit completed CRFs to according to Protocol requirements. Federal regulations require that copies of case report formsbe retained by the Institution for a period of no less than two years following either the approval of the New Drug Application or thewithdrawal of the Investigational New Drug Application. E.Study Drug. Institution shall keep the Study Drug in a locked, secured area, and maintain control of the Study Drug in accordance with thisAgreement, the Protocol and Applicable Law, including taking regular and ongoing inventories and reconciling the same with records ofreceipt and dispensing or other disposition of the Study Drug as required by Applicable Law. Any use by Institution or Investigator of theStudy Drug for any purpose outside of the Protocol is prohibited by this Agreement, and any work so performed would represent a breach ofthis Agreement and misuse of the Study Drug. Institution shall make use of the Study Drug solely for the purpose of conducting the ClinicalTrial in accordance with the Protocol and shall limit access to Institution personnel working on the Clinical Trial. All unused StudyDrugs(s), and any other materials, that were furnished to Institution by or on the behalf of Sponsor shall be returned to Sponsor or destroyedby Institution at the completion or termination of the Clinical Trial, as directed by Sponsor and Sponsor’s designee. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. F.Required Disclosures. (i)In compliance with Applicable Law governing “Financial Disclosure by Clinical Investigators” (21 CFR Part 54), Institution shallrequire all Investigators proposed to work on the Clinical Trial to submit FDA financial disclosure forms to Sponsor’s designee beforebeginning work on the Clinical Trial, and update such information promptly if any relevant changes occur during the term of thisAgreement and for one (1) year following completion of the Clinical Trial. Notwithstanding anything to the contrary in this Agreement, Institution acknowledges and agrees that (a) GOG and/or Sponsor arepermitted to publicly disclose information regarding this Agreement to comply with Applicable Law, including without limitation thePhysician Payment Sunshine Act (a provision of the Patient Protection and Affordable Care Act) (collectively,“Disclosure Laws”) and(b) this information may include without limitation payments, or other transfers of value, made on behalf or at the request of GOG tophysicians, hospitals, and other persons or entities that are the subject of the Disclosure Laws (each a “Disclosure Subject”). Institutionagrees to promptly respond to, and cooperate with, reasonable requests of GOG and/or Sponsor regarding collection of informationregarding and compliance with Disclosure Laws. Institution shall collect and, no later than January 30 of each year during the term ofthis Agreement, submit in a format reasonably requested by GOG the following information for each Disclosure Subject that, inconnection with or as a result of performance of the Clinical Trial, received payments or other transfers of value in the calendar yearprior to the year in which such submittal is to be made hereunder: (1) the amounts, dates, and description of payments made to, or othertransfers of value to, each Disclosure Subject; (2) the name, address, specialty, and, if applicable, National Provider Identifier number ofeach Disclosure Subject; and (3) a description of the goods or services provided by each Disclosure Subject in return for such paymentsor transfers of value. G.Biologic Materials. Institution shall (i) maintain in accordance with industry standards and Applicable Law, any biologic materials ofhuman origin (“Materials”) collected by Institution in accordance with the Protocol; (ii) retain all right, title and interest in and to theMaterials, (iii) grant Sponsor an exclusive, royalty-free, perpetual license to use such Materials in accordance with the Protocol and thePatient Informed Consent under which the Materials were obtained; (iv) use the Materials for purposes of obtaining and maintainingregulatory approval of the Study Drug; and (v) use the Materials in conjunction with the confidentiality and Publication rights set forth inthis Agreement. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. III.Duties of GOG. A.Sponsor and Sponsor’s designee shall provide the Investigator’s Brochure, and any amendments and/or updates to the Investigator’sBrochure for the Study Drug. Sponsor shall provide Institution properly formulated and acceptably labeled clinical-grade Study Drugwithout charge, in a timely manner and in sufficient quantity to complete the Protocol. B.Amount of Payments. GOG shall pay Institution in accordance with the Exhibit “C” Site Budget attached hereto and incorporatedherein by reference, provided, however, that the services have been properly performed in accordance with the Protocol and thisAgreement, in a timely and satisfactory manner. Payment for partially completed cases, i.e., early withdrawals, shall be made on a pro-rata basis for services performed according to the Budget. Institution and Investigator will not be paid for any services performed thatviolate the Protocol or this Agreement. C.Payments shall be sent to Institution as follows: (i)Checks shall be made payable to: ____________ (“Payee”) (ii)Federal Tax I.D. Number: ____________ (iii)Checks shall be mailed to: Attention: ___________ Institution and Investigator acknowledge that the designated Payee is the sole recipient of payment under this Agreement and that no separateor additional payment will be made by GOG to Institution, Investigator or any other person or entity for services provided in connection withthis Agreement. IV.Confidential Information. A.“ Confidential Information” means all proprietary, trade secret and/or confidential information, including Sponsor informationand Study Drug, that Sponsor, Sponsor’s designee and GOG or its representatives provides to Institution, which is (i) in writing orother tangible or electronic medium and designated “confidential” or otherwise marked with indicia of its confidential nature; (ii)orally disclosed and not previously reduced to a tangible medium, provided that Sponsor, Sponsor’s designee and GOG shall usereasonable efforts to identify such information as “confidential” at the time of disclosure and thereafter summarize suchinformation in writing or reduce it to a tangible medium within thirty (30) days of disclosure; (iii) the foregoing notwithstanding,disclosed by Sponsor, Sponsor’s designee and GOG and which a reasonable person would understand to be confidential orproprietary in nature, including, without limitation, the Protocol, Investigator’s Brochure and any regulatory documents; or (iv)any Data, records and information (excluding source medical documents), generated by Institution, Investigators and InstitutionPersonnel as a result of the performance Study including information, Data and Clinical Trial results generated or required duringthis Agreement or Sponsor’s Confidential Information including un-published Data and Study results, CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. B.Notwithstanding any designation by Sponsor, Sponsor’s designee and GOG, “Confidential Information” shall not includeinformation which the receiving party can demonstrate that: (i)is or becomes publicly known or available through no fault of Institution or Investigators or Institution Personnel; (ii)Sponsor, Sponsor’s designee and GOG has made available to third-parties without a confidentiality obligation; (iii)is already independently known to Institution or Investigator, as shown by their prior written records except for informationconcerning the Clinical Trial that was created in collaboration with Sponsor, Sponsor’s designee and GOG or in view of thisAgreement; (iv)at such time that it is disclosed, is included in a publication produced in accordance with Section VI; or (v)publicly available information that relates to potential hazards or warnings associated with the production, handling, or use of theStudy Drug. C.Institution and Investigators shall not: (i) disclose, and shall cause their respective employees and agents not to disclose, theConfidential Information to any third party without the prior written permission of GOG and/or Sponsor, as applicable, except aspermitted by this Agreement; and (ii) use the Confidential Information for any purpose other than the conduct of the Clinical Trial.The Confidential Information shall remain the confidential and proprietary property of Sponsor (or GOG as the case may be) andshall be disclosed only to Investigator and the Institution Personnel or agents on a “need to know” basis. Confidential Informationshall not be provided by the Institution to any parties not involved in the conduct of the Study, other than to GOG and/or Sponsor.Institution further acknowledges and understands that Sponsor is a public company traded on the NASDAQ, and accordingly, theConfidential Information may be considered as “inside information” pursuant to securities laws and regulations. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. D.In the event that Institution or Investigator or their employees and agents reasonably find it necessary to disclose any ConfidentialInformation to a governmental authority to defend the research against an allegation of fraud or other misconduct, or to defendthemselves in any other legal proceeding, or are required by applicable law or medical duty to disclose Confidential Information,the party may make the necessary disclosure after providing reasonable prior written notice to Sponsor and GOG, and attemptingin good faith to agree upon a mutually satisfactory way to disclose only such portions of the Confidential Information as isnecessary to achieve this limited purpose. In the event disclosure is required under this section, after reasonable notice has beenprovided to the Sponsor, Institution or Investigator with whom the request for Confidential Information has been made agrees tofully cooperate at Sponsor’s sole cost and expense with Sponsor should Sponsor seek a protective order, or other legal remedy tolimit the disclosure of such Confidential Information. E.Nothing herein shall be construed as preventing Institution or Investigator from publishing or otherwise publicly disclosing anydata generated from the Clinical Trial as provided in Sections VI and VII, below. F.The obligations of this Section IV shall survive the expiration or termination of this Agreement. V.Recordkeeping; Access to Data; Inspection and Audit. A.Institution shall maintain a file of all documents pertaining to the Protocol, including, but not limited to, Protocol amendmentsand safety reports. Institution shall obtain and maintain a signed Patient Informed Consent for each Enrolled Participant and retainsuch Patient Informed Consent for at least three (3) years or longer, as required by Applicable Law or Sponsor or GOG. Institutionshall submit completed CRFs according to Protocol requirements. B.Institution shall require (i) Investigator to create and maintain Data, and (ii) Investigator and other research staff to maintainconfidentiality of personally identifiable information concerning Enrolled Participants, and shall disclose such information tothird parties only as permitted by Applicable Law. All Data provided by Institution to Sponsor and Sponsor’s designee withrespect to Enrolled Participants shall be furnished without patient names. C.Institution shall provide a complete copy of all collected Data and shall grant Sponsor the exclusive right to use, reference anddisclose such Data for all purposes relating to the Study Drug, including, but not limited to, independent analysis, filing of FDAapplications or other regulatory submissions, preparing patent applications and related filings and any other lawful purpose. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. D.Institution shall retain, all Clinical Trial-related records in accordance with 21 CFR §312.62, and at a minimum for a period of two(2) years following the date a marketing application is approved for the Study Drug for the indication for which it is beinginvestigated, and if no application is to be filed or if the application is not approved for such indication, until two (2) years afterthe Clinical Trial is discontinued and the FDA is notified, However, prior to destroying or otherwise disposing of any such records,Institution will provide Sponsor or Sponsor’s designee a reasonable opportunity to take possession of the records at Sponsor’s ownexpense. E.Sponsor and GOG and authorized agents of FDA, HHS, and other federal agencies shall have the right to inspect and review Data atthe Institution to the extent permitted by law and during regular business hours and upon reasonable notice. F.Institution shall permit GOG and Sponsor or its representatives to conduct periodic monitoring visits and audits, to the extentpossible at mutually acceptable times during normal business hours, to (i) inspect records (both written and electronic) relating tothe Clinical Trial and Clinical Trial Data at the Participating Institutions during normal business hours from time to time asreasonably requested by Sponsor, (ii) inspect and examine the Participating Institutions’ facilities at which the Clinical Trial isbeing conducted, and (iii) verify compliance with the Protocol and this Agreement by GOG, Study Chair, Principal Investigator,Participating Institutions, and Clinical Investigators. VI.Publication and Other Public Presentation of Results. Sponsor and GOG recognize that, consistent with the principles of academic freedom, Institution requires that Investigators be free to publish the results oftheir research activities after Sponsor’s provision of the final study report. Investigators engaged in this Clinical Trial are permitted to publish reports injournals and other professional publications, and to present the methods and results of this Clinical Trial at symposia and professional meetings (each, a“Publication”), in accordance with the requirements of this Section VI. Such publication by Institution and/or Investigator may be no earlier than after acooperative multi-center publication has been published with Sponsor or eighteen (18) months from the date of completion or termination of the Study afterproviding Sponsor an opportunity to review and comment in accordance with the terms herein. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. A.GOG and Sponsor shall be furnished a copy of any proposed Publication for advisory review at least sixty (60) days in advance of thesubmission of such proposed Publication for journals and other professional publications and thirty (30) days for any other Publication,such as a poster presentation, abstract, or other written or oral material which describes the results of the Clinical Trial. Expedited review oradditional review time may be arranged by mutual written agreement. Sponsor may remove from the proposed publication any informationthat is Confidential Information. B.If within such review period, GOG and/or Sponsor determines and notifies Institution in writing that the proposed Publication containsdisclosures of the intellectual property of Sponsor or GOG, Institution and Investigator agree to delay submission of the proposedPublication for up to an ninety (90) days in order to allow GOG or Sponsor sufficient time to take appropriate steps to preserve U.S. orforeign patent or other intellectual property rights and/or ensure compliance with securities disclosure obligations. As directed by Sponsorand/or Sponsor’s designee and/or GOG, Institution and Investigator shall provide any additional information in their possession whichSponsor deems necessary to file such patent application(s) or otherwise protect such intellectual property rights. Sponsor shall have three(3) months from its receipt of such additional information to file such patent application(s). Institution and Investigator shall not submit theproposed Publication to anyone who is not employed by Institution and under an obligation of non-disclosure and non-use at leastsubstantially identical to that imposed on the Institution and Investigator until each such patent application has been filed by Sponsor orthe conclusion of the three (3) month period of this Paragraph, whichever occurs first, or until the information on the potentially patentableinvention(s) is excised from the manuscript. Without limiting the foregoing, Institution and Investigator shall give due regard to GOG’s and Sponsor’s legitimate interests, such asmanuscript authorship, coordinating and maintaining the proprietary nature of submissions to health authorities, and coordinating withother ongoing studies in the same field, and agree to consider Sponsor’s reasonable comments and suggestions with respect to suchPublications. It is understood that, except to the extent required by Applicable Law or court order or for reasons of patient safety, alldisclosures of Data to third parties by Institution, Investigators and their personnel shall be through Publications in accordance with thisSection VI. For clarity, such parties may freely disclose the contents of a Publication made in accordance with this Section VI after suchPublication has been made. C.GOG and Sponsor shall have the right and license to reference and reproduce any such publication or presentation in connection with anyregulatory filing, patent application, company presentation, investor presentation or any other lawful purpose, subject to Section VIII. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. VII.Use of Names. Neither Sponsor, Sponsor’s designee, GOG nor Institution shall use the name, symbols and/or marks of the other in connection with the ClinicalTrial without prior written permission from the other party. Such permission is not required for disclosure of the existence of the Agreement inreports generated in the normal course of business by Sponsor, Sponsor’s designee or GOG, or where acknowledgment of sponsorship is requiredby the guidelines of a scientific publication or organization, or the fact that Institution is conducting the Clinical Trial in disclosures made bySponsor, Sponsor’s designee or GOG in the normal course of business, or where required by regulatory authority, law or stock exchange rule.Neither party shall use, nor authorize others to use, the name, symbols, or marks of the other or any affiliate thereof in any advertising orpublicity material or make any form of representation or statement in relation to the Clinical Trial that would constitute an express or impliedendorsement by the other party of any commercial product or service, without prior written approval from the other party. None of the foregoingin this Section VII shall restrict Sponsor, Sponsor’s designee or GOG from disclosing factual information regarding their relationship withInstitution, Institution’s performance of the Clinical Trial or the terms of this Agreement to prospective investors or sublicensees in the normalcourse of its business relating to the Study Drug. Notwithstanding anything to the contrary herein, the parties agree that Institution may post thefollowing information on its website and in its research newsletter, with prior approval of the IRB if required: name of Institution, Sponsor,Sponsor’s designee and/or GOG and Investigator; Protocol title, area and/or description of the Clinical Trial; Institution’s internal projectnumber; Institution’s contact information. VIII.Patents and Inventions. Any New Inventions (whether patentable or not), innovations, suggestions, ideas and reports arising out of or in connection with the performance of theStudy by Institution, Investigator and Institution Personnel, or the contractors of any of the foregoing, shall be promptly disclosed to Sponsor, and shall bethe exclusive property of Sponsor. Upon Sponsor’s request, and at Sponsor’s sole expense, Institution and Principal Investigator shall take all reasonableactions necessary or appropriate to obtain patent or other proprietary protection in Sponsor’s name with respect to any of the foregoing. Sponsor grants toInstitution a limited, royalty-free, non-exclusive license (without the right to sublicense) to use the Sponsor’s Study Drug as required to carry out the ClinicalTrial in compliance with the Protocol. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. A.“New Invention(s)” shall mean any invention or discovery conceived, reduced to practice, or otherwise discovered or developed, in wholeor in part, by Institution, Investigator, Institution Personnel, GOG, Sponsor, or the contractors of any of the foregoing, based on or resultingfrom performance of the Clinical Trial. As used in this Article VIII, the term “conceived” shall have the same definition of “conception” asset forth in section 2138.04 of the United States Patent and Trademark Office’s Manual of Patent Examining Procedure, Eighth Edition,Latest Revision July 2010. B.“Institution Invention(s)” shall mean any New Invention that is conceived, reduced to practice or otherwise discovered or developed solelyby Institution Personnel and is not, in whole or in part, (i) anticipated by the Protocol; (ii) made in violation of the Protocol or thisAgreement; (iii) conceived, reduced to practice or otherwise discovered or developed by any Institution Personnel in performance of theClinical Trial or the use of the Study drug; (iv) dependent on or derived from Sponsor’s Background IP or Confidential Information; or (v)conceived, reduced to practice or otherwise discovered or developed as a result of access to the Study Drug or Sponsor’s Background IP orConfidential Information. Institution Inventions shall be the sole property of Institution. Institution shall provide, and shall cause theInstitution Personnel to provide, prompt written notice to Sponsor of any New Invention. “Institution Personnel” shall mean, separatelyand collectively, Institution, Investigator, or the employees, staff, or contractors of Institution or Investigator. C.“Joint Invention(s)” shall mean any New Inventions conceived, reduced to practice or otherwise discovered or developed jointly by (i)Institution or any Institution Personnel and (ii) Sponsor, GOG, or any contractors of Sponsor or GOG. Joint Inventions shall be owned bySponsor, Institution and GOG shall provide prompt written notice to Sponsor of any Joint Invention. Institution and Investigator herebyassign and agree to assign, to Sponsor all of their respective right, title and interest in and to any Joint Inventions, and at the request andexpense of Sponsor, shall cause to be executed all documents and perform all further acts necessary to effect, evidence, or perfect suchassignment and protect Sponsor’s ownership of any Joint Invention, which shall include providing reasonable assistance with the filing,prosecution, or enforcement of any patents. D.Except as expressly provided above in Articles VIII(C) and VIII(D) above, all other New Inventions, including without limitation those NewInventions (i) anticipated by the Protocol; (ii) made in violation of the Protocol; (iii) conceived, reduced to practice or otherwise discoveredor developed by any Institution Personnel in performance of the Clinical Trial; (iv) dependent on or derived from Sponsor’s Background IPor Confidential Information; or (v) conceived, reduced to practice or otherwise discovered or developed as a result of access to the StudyDrug or Sponsor’s Background IP or Confidential Information; shall be the sole property of Sponsor (“Sponsor Invention”). Institutionshall provide prompt written notice to Sponsor of any Sponsor Invention. Institution and Investigator/s each hereby assign to Sponsor all oftheir respective right, title and interest in and to any Sponsor Inventions, improvements in Sponsor Inventions technology related toSponsor Inventions, and at the request and expense of Sponsor, shall cause to be executed all documents and perform all further actsnecessary to effect, evidence, or perfect such assignment and protect Sponsor’s ownership of any Sponsor Invention, which shall includeproviding reasonable assistance with the filing, prosecution, or enforcement of any patents at Sponsor’s sole cost and expense. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. E.The right of publication by Institution and Investigator, as described in Section VI, shall not be affected by a license to use any NewInvention. F.Existing inventions, ideas, discoveries, technologies, methodologies and other intellectual property of each party that were conceived,reduced to practice, or otherwise discovered or developed before the Effective Date (“Background IP”) are their separate property, whetherprotected by patent or other intellectual property rights, and except as expressly provided in Section VIII(A), are not affected by thisAgreement. Neither party shall have any claims to or rights in any such inventions, ideas, discoveries or methodologies of the other party orof Sponsor. IX.Insurance; Indemnification. A.Sponsor maintains and Institution maintains and shall require Investigators to maintain a policy or program of insurance or self-insurance inamounts adequate to cover its obligations hereunder and in accordance with industry standards or otherwise as required by law.Specifically, Institution shall maintain a policy or program of insurance of self-insurance in full force and effect, throughout theperformance of the Clinical Trial that covers: (a) employer’s liability; (b) general liability; (c) contractual liability; (d) premises liability; (e)professional medical and nursing indemnity in amounts adequate to cover its obligations hereunder and in accordance with industrystandards or as otherwise required by law. B. Upon request, each party shall provide the other with evidence of its insurance or self- insurance coverage, and unless self-insured, willnotify the other party within three (3) business days of notice of any reduction, non-renewal or cancellation of its coverage. Institution shallmaintain a policy or program of insurance of self-insurance and require Investigators to have malpractice insurance in accordance withindustry standards or otherwise required by law C.Any indemnification rights afforded to the Institution for the Clinical Trial are provided exclusively by Sponsor and are contained in theLetter of Indemnification attached hereto as Exhibit D. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. X.Term and Termination. A.This Agreement shall become effective on the Effective Date and, unless terminated earlier pursuant to the termination provision below,shall continue in force until Sponsor, Sponsor’s designee and/or GOG receives all Data, questions about Data submitted have been resolved,the database has been locked, and the final study report provided to and accepted by Sponsor. B.This Agreement will terminate automatically if any of the following occur: (i)if FDA imposes a permanent hold on the Study Drug; (ii)if the Clinical Trial is terminated by Sponsor or Institution for reasons of patient safety; or (iii)if a formal investigation by an authorized governmental agency finally determines that the Data have been falsified or irreparablycompromised by research misconduct. C.This Agreement may be terminated by either party, upon thirty (30) days prior written notice, if either party fails to materially comply withthe terms of this Agreement after receipt of written notice, with reasonable opportunity to cure, from the other party. D.This Agreement may be terminated by Institution immediately upon written notice to Sponsor and GOG if Institution reasonablydetermines that patient safety requires termination. This Agreement may be terminated by Sponsor for any reason upon thirty (30) daysprior written notice to Institution. Provided, however, Sponsor may suspend the Clinical Trial, in whole or in part, at any time for anyreason. The suspension of the Clinical Trial by Sponsor for any reason shall not be deemed a material breach of this Agreement. E.Institution shall return or properly dispose of, at the option of Sponsor, any unused Study Drug, in each case prior to the effectivetermination date indicated in the notice of termination or the date of automatic termination, if applicable. Further, Institution shall, withinthirty (30) days of the effective date of such termination or expiration, return any Confidential Information, provided, however, that one (1)archival copy of Sponsor and/or GOG’s Confidential Information may be retained solely for purposes of monitoring compliance with thisAgreement. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. F.Upon the effective date of any termination or expiration of this Agreement, Institution shall (i) notify the Investigator that the Clinical Trialhas been terminated, (ii) cease (and cause the Investigator to cease) enrolling further patients in the Clinical Trial, (iii) cease (and causeInvestigator to cease) treating Enrolled Participants according to the Protocol as directed by GOG and/or Sponsor and Sponsor’s designee tothe extent medically permissible and appropriate, and (iv) terminate (and cause Investigator to terminate) as soon as practicable, but in noevent more than thirty (30) days after the effective date of termination, all other applicable Clinical Trial activities; provided however, thatupon Sponsor, Sponsor’s designee and/or GOG’s request, Institution shall continue to collect Data and prepare and complete CRFs forEnrolled Participants treated in the terminated Clinical Trial prior to termination or expiration. Within ninety (90) days from the effectivedate of any termination, Institution shall provide to Sponsor, Sponsor’s designee and/or GOG all Data. G.Expiration or termination of this Agreement for any reason shall not affect the rights and obligations of the parties accrued prior to theeffective date of such expiration or termination. The rights and duties as specified and any other provision that by its terms is intended tosurvive termination or expiration, shall survive the termination or expiration of this Agreement. H.The parties shall cooperate with each other and with Federal agencies in winding down the Clinical Trial. XI.Miscellaneous. A.Independent Contractor. Institution, Investigators and other research staff are independent contractors and are neither employees noragents of Sponsor, Sponsor’s designee nor GOG. Sponsor, Sponsor’s designee or GOG does not intend to create any partnership, jointventure, employment or agency relationship pursuant to this Agreement. Neither party to this Agreement shall have the right to bind theother party by contract or otherwise to transact business in the other party’s name or on its behalf, unless with the specific written consent ofthe other party. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Correspondence. Institution shall address all medical/scientific communications to the Sponsor or Sponsor’s designee at the address listed in the Protocoland to GOG. B.Notices. Legal notices given to the respective parties hereunder shall be in writing and sent by facsimile or by registered or certified mail tothe following: If to Institution:______________ If to Sponsor: If to GOG:The GOG Foundation, Inc. Four Penn Center, Suite 1020 1600 John F. Kennedy Boulevard Philadelphia, Pennsylvania 19103-2800 [***] [***] [***] With a copy to:______________, General Counsel The GOG Foundation, Inc. 1600 John F. Kennedy Boulevard, Suite 1020 Philadelphia, PA 19103-2800 Notices shall be deemed given when facsimile transmission or mail receipt is confirmed. D.Assignment/Subcontracting. Due to the specialized nature of the services provided under this Agreement, Institution shall not assign,transfer or convey this Agreement or subcontract services under this Agreement without GOG and Sponsor’s prior written consent. ThisAgreement shall inure to the benefit of each party and its permitted successors and assigns. Institution shall only conduct the Clinical Trialat the Institution. For the performance of its obligations under this Agreement, Institution shall only use its employees or the employees ofInstitution’s wholly owned affiliates that are obligated to the relevant terms of this Agreement via a separate agreement with Institution. E.Amendment. Any amendment(s) to this Agreement must be in writing and signed by both parties. F.Alternative Dispute Resolution. The parties agree to make their best efforts to resolve any disputes regarding this Agreement through theCommercial Rules of the American Arbitration Association by one arbitrator appointed in accordance with said Rules. G.Entirety of Agreement. This Agreement constitutes the entire agreement between the parties concerning the subject matter herein, andsupersedes all prior terms or understandings, written or oral. In the event of a conflict between the terms of this Agreement and the Protocol,this Agreement shall govern all legal and financial matters and the Protocol shall govern all clinical matters. H.Waiver. Neither the waiver by any of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor thefailure of any of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right orprivilege hereunder shall thereafter be construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver of any ofsuch provisions, rights or privileges hereunder. No waiver by a party hereto of, or consent by a party hereto to, a variation from anyprovision of this Agreement shall be effective unless made in a written instrument duly executed on behalf of such party. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. I.Severability. The invalidity or unenforceability of any term or provision of this Agreement shall not affect the validity or enforceability ofany other term of this Agreement. J.No Debarment. Institution represents and warrants that to the best of its knowledge, after due inquiry using industry standards, neitherInstitution nor any of its employees or agents, Principal Investigator, or any participating Investigator or any of their employees or agents,rendering activities pursuant to this Agreement is presently debarred pursuant to the Generic Drug Enforcement Act of 1992, 21 U.S.C. §335(a), (b)(1), and (b)(2), as amended from time, or disqualified under 21 C.F.R. § 312.70 or § 812.119, as amended from time to time, orany other FDA authority. During the term of this Agreement, Institution shall notify GOG upon knowledge of Institution or any such personinvolved in the Clinical Trial becoming debarred or disqualified. K.Inspections. If any governmental or regulatory authority conducts or gives notice to Institution of its intent with respect to any activitiesunder this Agreement to conduct an inspection, audit, or monitoring visit at Institution or take any other regulatory action, or if Institutionor Investigator becomes aware of any such governmental inspection or other regulatory activity at Institution, Institution shall promptlygive Sponsor and Sponsor’s designee and GOG notice thereof by telephone with follow-up notice provided in writing within forty-eight(48) hours of the telephonic notification, including all information pertaining to any such inspections or actions, and Institution shall allowor cause the applicable Investigator to allow Sponsor and/or Sponsor’s designee and GOG to be present at any such inspection or actions.The Institution and the Investigator shall provide Sponsor and Sponsor’s designee and GOG with a copy of any report received inconnection with, or as a result of, such inspection within three (3) days of its receipt. Any required response or action by Institution shall bemade within two (2) weeks of issuance of any citations or within any earlier deadline set by the issuing regulatory authority and shall makea good faith consideration to incorporate any comments provided by Sponsor and/or Sponsor’s designee and GOG on any proposed writtenresponse. Sponsor may at its discretion solicit input from GOG to provide input into the proposed response. Institution shall provideSponsor and Sponsor’s designee and GOG with a copy of any such written response. In the event the FDA or other regulatory authorityrequests or requires any action to be taken to address any citations, Institution shall immediately provide Sponsor and Sponsor’s designeeand GOG with written notice thereof and shall require that Investigator, after consultation with Sponsor and/or Sponsor’s designee, takesuch action as necessary to address and correct any such citations, and cooperate with GOG, Sponsor and/or Sponsor’s designee with respectto any such citation and/or action taken with respect thereto. Sponsor may at its discretion solicit input from and involve GOG indiscussions regarding responses to any action which needs to be taken to respond to any citations or recommendation from the FDA orother regulatory authority. L.No Sanctions. Institution hereby represents and warrants that neither Institution nor any of its personnel involved in the Clinical Trial, norto the knowledge of Institution any Investigator, or the research staff have been or shall be involved in an investigation or in research thatwas terminated, as the term “termination” is used in 21 CFR 812.3(q), nor have they been subjected to any sanctions related to allegationsof research or professional misconduct. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. M.Additional Actions and Documents. Each of the parties hereto hereby agrees to take or cause to be taken such further actions, to execute,deliver and file or cause to be executed, delivered and filed such further documents and instruments, and to obtain such consents, as may benecessary or as may be reasonably requested in order to fully effectuate the purposes, terms and conditions of this Agreement. N.Authority of the Parties. The Parties hereby represent and warrant that they have the legal authority to enter into this Agreement and thatthe terms of this Agreement are not inconsistent with their other contractual arrangements. O.Counterparts. To facilitate execution, this Agreement may be executed in as many counterparts as may be required. It shall not benecessary that the signature of or on behalf of each party appears on each counterpart, but it shall be sufficient that the signature of or onbehalf of each party appears on one or more of the counterparts. All counterparts shall collectively constitute a single agreement. It shall notbe necessary in any proof of this Agreement to produce or account for more than a number of counterparts containing the respectivesignatures of or on behalf of all of the parties. Any signature provided by facsimile or electronic image transmission shall be binding to thesame extent as an original signature page. P.Headings. The headings of this Agreement are for ease of reference only and shall not limit or otherwise affect the meaning of the terms andconditions of this Agreement. Q.Nondiscrimination. Each party agrees to comply with all applicable Federal, state and local laws respecting discrimination. The partieshereby incorporate the requirements of 41 C.F.R. § 60-1.4(a), 41 C.F.R. § 60- 741.5(a), 41 C.F.R. § 60-250.5(a), 41 C.F.R. § 60-300.5(a), and29 C.F.R. § 471 Appendix A to Subpart A (Executive Order 13496), as applicable. R.Notification of Incidents. Each party agrees to promptly notify the other party after the discovery of any incident, occurrence, claim (eitherasserted or potential), lawsuit or other causes of action involving this Agreement, and both parties agree to cooperate with each other asmay be necessary to resolve such matters. S.Release of Information. The provisions of this Agreement are confidential and protected from disclosure to a third party, other than theSponsor and either party’s agents, attorneys, consultants and designees, unless disclosure is required by law, or said third party is bound tothe same level of confidentiality set forth in this Agreement. T.Unforeseen Circumstances. Neither party will be deemed in violation of this Agreement if prevented from performing any of its duties andresponsibilities under this Agreement for circumstances beyond its reasonable control. In the event either party is unable to perform itsduties and responsibilities due to said circumstances, the other party has the right to terminate this Agreement upon written notice to theaffected party. U.Survival. Sections IV (Confidential Information), V (Record Keeping; Access to Data, Inspection and Audit) and VIII (Patents andInventions) shall survive termination of the agreement V.Third Party Beneficiary. Sponsor shall be a third party beneficiary of this Agreement. [Signature page follows] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. The Parties hereby accept and agree to the terms and conditions of this Agreement. (INSTITUTION) : GOG Foundation, Inc.: By: By: Name: Name:Larry J. Copeland,, M.D. Title:Authorized Signatory Title:President Date: Date: READ AND AGREED TO: INVESTIGATOR By: Name: Date: CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. EXHIBIT A PROTOCOL [To be attached] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. EXHIBIT B INFORMED CONSENT TEMPLATE [To be attached] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. EXHIBIT C BUDGET INFORMATION CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. EXHIBIT D [Sponsor Letter of Indemnification attachment] CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED.   AGREEMENT This AGREEMENT is made the 1st day of June 2016 BETWEEN Vascular Biogenics Ltd. registration number 51-289976-6 a company incorporated in Israel and having its principal place of business at 6 Yonni NetanyahuSt. Or-Yehuda Israel (the “Customer”) AND Biopharmax Group Ltd. registration number 51-241021-8, a private company incorporated in Israel and having its principal place of business at 4Hasadnaot St. Hertzelia (the “Contractor”) WHEREAS: 1.The Customer wishes to erect, commission and validate a sterile manufacturing facility, all conforming to cGMP, FDA, EMEA, MOH (as defined below)and other Israeli regulations (the “Project”) located at Hasatat 8 Modiin, Israel (the “Facility”);2.The Contractor wishes to undertake the execution of all the Works, (as defined below), all subject to the terms and conditions of the Agreement as setforth herein below;3.The Contractor represents that it is an independent contractor, duly registered with the Contractor registrar, and that it has, the know-how, expertise,financial and technical means and experience required for execution and completion of the Works all in accordance with and subject to the terms andconditions set forth herein;4.The Contractor, has thoroughly examined and studied Costumer’s budget, URS, necessities and requirements, the premises set forth in Section 1 to thispreamble above and its surroundings, as well as the annexes attached hereto, and represents that it is capable to perform and complete the Works incompliance with the terms of this Agreement, and in accordance with the best industry standards and within the Timetable; and5.On the basis of Contractor’s warranties, representations and covenants set forth herein, Customer offered to Contractor to perform the in accordance withterms herein and Contractor has agreed to perform the Work as aforesaid. NOW THEREFORE, the parties declare, stipulate and agree as follows: 1.DEFINITIONS AND INTERPRETATIONS 1.1The following terms shall have the meanings appearing alongside them: “Agreement” - This Agreement and its Annexes and any document which has been / will be agreed upon in writing constitutes part of theAgreement even if not actually attached to the Agreement. “Bill of Quantity” – the bill of quantity setting forth all the Means required prepared by Contractor based on the requirements of the Design, UserRequirement Specifications and the Basis of Design attached hereto as Annex A. “Detailed Design” – mean the basis of design prepared by Contractor and approved by the Customer on the basis of the URS attached hereto asAnnex C2, and/or which will be attached in the future. 1CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. “cGMP”- the current Good Manufacturing Practices “Drawings” - The drawings for execution of the Work (as defined below) which are attached to the Agreement as Annex C1, and/or which will beattached in the future. “DQ”- design qualifications “EMA” - the European Medicines Agency, or any successor agency “FDA” - the United States of America Food and Drug Administration, or any successor agency. “Means” - The equipment, supplies, tools, materials, structures, scaffolding, installations and everything else that provided by the Contractor andrequired for execution of the Works or which will be used for the execution thereof. “MOH”- means the Israeli Ministry of Health, or any successor agency “IC” – installation commission “IQ” – installation qualifications “OC” – operation commission “OQ” – operation qualification “Regulations” – means the applicable cGMP, FDA, EMA, MOH and Israeli regulations required for the construction, maintenance and operation ofthe Facility. “Scope of Work” - the scope of work containing the implementation, manufacturing, equipment, materials and overall scope for the Project, in theform attached as Annex B. “Specifications” - the specifications of the Facility as specified in and in accordance with the Design, User Required Specifications, DetailedDesign and the Bill of Quantity. “Timetable” – the time table for the specific stages as set forth in Annex D. “User Requirement Specifications” or “URS” – the specifications prepared by the Customer attached hereto as Annex I. “Work and/or Works” – the execution, performance and completion of the Project, inclusive of all Means and services as set forth in the Scope ofWork, meeting all of the Specifications. 1.2The Preamble hereof and all Annexes attached hereto form an integral part of this Agreement. The headings of the Sections, Sub-Sections orchapters in the Agreement are for convenience only, and shall not serve in interpretation of the Agreement. 1.3In any case of discrepancy or contradiction between the provisions of this Agreement or between one of its provisions and one if its Annexes, theprovisions of the Agreement will prevail. In case of conflict between the Annexes, the provisions of the Annexes shall govern in accordance withthe following order: Annex I, Annex B, Annex C2, Annex C1 and Annex A. 2CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 2.THE ESSENCE OF THE AGREEMENT 2.1The Customer hereby conveys to the Contractor and the Contractor hereby takes upon itself the execution and completion of the Work, on turnkeybasis, at its own expense and on its own responsibility and in exchange for the Consideration (as defined below), all in accordance with theprovisions of the Agreement. 2.2Except as explicitly provided in the Scope of Work as being excluded from the Work but subject to Section 4.4 below (the “Excluded Items”), theContractor shall perform or cause to be performed all work and services required in connection with the management, procurement, construction,DQ, IC OC, IQ and OQ and testing of the Work, and provide all materials and equipment 2.3, machinery, tools, labor, transportation, utilities, administration, training and other services and items required to complete the Work at theConsideration. Upon successful DQ, IC OC, IQ and OQ testing of the Work and issuance of a Certificate of Completion (as defined below), allresponsibilities regarding the Facility and Work shall transfer to Customer, subject to Contractor’s warranty, all as set forth in Section 17 below. 2.4The Facility shall be constructed and operable in accordance with cGMP, and, in addition, will meet the current requirements in effect as of thedate of this Agreement of the FDA, EMA, MOH and other relevant authorities of Israel. 3.ANNEXES The Annexes to this Agreement are listed below: 1.1Bill of Quantity – Annex A.1.2Scope of Work – Annex B.1.3Drawings – Annex C1.1.4Detailed Design - Annex C 2.1.5Timetable – Annex D.1.6Certificate of Completion – Annex E.1.7Payment Schedule- Annex F.1.8Certificate of insurance by the Contractor- Annex G.1.9URS- Annex I1.10Conceptual design – Annex J1.11Bank Guarantee – Annex K. 4.CONSTRUCTION SCHEDULE; LIQUIDATED DAMAGES; FORCE MAJEURE 4.1The Contractor shall carry out the work as per the Timetable. 4.2The Work shall be completed by the completion date set forth in the Timetable (“Project Completion Date”). 4.3If in the opinion of the Customer and based upon the Timetable, the Contractor is behind schedule, the Customer will direct the Contractor to takeappropriate action to accelerate the performance of the Work so that the Project Completion Date is not jeopardized. Such action shall include butnot be limited to overtime, shift work, additional construction equipment, extra work crews, etc. (as applicable), regardless of whether this was anExcluded Item. Any extra costs associated with such action will be borne by the Contractor, unless the delay was caused by an event that entitlesthe Contractor to a time extension, pursuant to Section 4.5 below or caused by the Customer. 4.4The Contractor shall be responsible for liquidated damages for delays in the completion of the Work by the Project Completion Date caused by theContractor, its employees, agents, subcontractors, suppliers or any other person or entity for whose acts the Contractor is liable, including but notlimited to delays caused by problems with the Design, following a grace period of 5 (five) weeks (the “Grace Period”). In the event of delays incompletion of the Work beyond the Grace Period, the Customer shall be entitled, following written notice to the Contractor but without recourse tojudicial proceedings or proving damage, to collect as liquidated damages (and not as a penalty) US$ 5,000 (Five Thousand US Dollars) per weekfor each week of delay up to maximum of US$60,000 (Sixty Thousand US Dollars) +VAT. The payment of any liquidated damages hereunder shallnot affect Customer’s right to terminate the Agreement and the consequences thereof. 3CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 4.5Should the Contractor be delayed by any cause constituting an event of “Force Majeure” (as defined below), then the Project Completion Dateshall be extended for a period equivalent to the time lost by reasons of any event of Force Majeure in accordance with Section 22 below. 4.6As guarantee of execution of the Contractor’s undertakings under this Agreement, on the date of execution of this Agreement the Contractor shallprovide an unconditional, autonomic, irrevocable bank guarantee, in the sum of NIS [***] (the “Bank Guarantee”), in accordance with the formatattached as Annex K, which shall be valid until 60 days following the receipt of Certificate of Completion. In the event that the Bank Guaranteehas been forfeited, in full or in part, the Contractor undertakes to provide the Customer with a new Bank Guarantee or to complete the forfeitedbank guarantee, all within 7 days as of the day of forfeiture. 5.SUBCONTRACTING 5.1The Contractor shall be entitled to subcontract all or part of the Work .For any work that exceeds NIS 500,000 (Five Hundred Thousand New IsraeliShekels) the Contractor must obtain the prior written consent of the Customer. 5.2Contractor shall be fully responsible and liable for the acts and omissions of any subcontractors. Any breach of this Agreement by a subcontractoror supplier shall be deemed a breach by the Contractor. 5.3Nothing contained in this Agreement and/or any agreement or arrangement between the Contractor and any subcontractors or suppliers shall createany contractual obligations on the part of the Customer to any subcontractor or supplier. 6.SUPERVISION; PROJECT MANAGER AND QUALIFIED PERSONNEL 6.1The Contractor shall designate a full time project manager (the “Project Manager”), agreed by the Customer, to be responsible for the execution ofthe Work. The Project Manager shall have the experience, skills and capability to timely complete the Work according to this Agreement. 6.2The Project Manager shall act as single point of contact and have authority to act on behalf of the Contractor. The Project Manager will beavailable to attend weekly meetings with the Customer’s representatives. 6.3The Customer will appoint a project coordinator (the “Project Coordinator”), to be responsible for the Customer’s obligations related to the Work.The Project Coordinator will be available to attend weekly meetings with the Project Manager. Without derogating from the Contractor’sresponsibilities and obligations, the Contractor undertakes to fulfill the instructions of the Project Coordinator and obey him. 4CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 7.REPORTING The Contractor shall submit to the Customer weekly and monthly progress reports on the Work performed, including updated Timetables showing, amongother things, the relevant portion of the Work performed. The reports shall be in such form as shall be agreed upon by the parties. 8.COMPLIANCE 8.1The Contractor shall comply with the applicable laws, rules, regulations or ordinances applicable to the performance of the Work. The Contractorshall secure and pay for all permits, governmental fees and licenses necessary for Contractor to operate in Israel and to carry out the Work inaccordance with this Agreement. It is clarified that licenses, permits and fees related to the Facility and Project itself shall be Customer’sresponsibility. 8.2Without derogating from the foregoing: 8.2.1The Contractor shall comply with the laws of Israel, including, without limitation, social insurance law, labor law, tax law, safety laws andall other laws regulations and requirements that may be applicable to the performance of the Work. 8.2.2Contractor shall obtain and maintain in full effect all work permits and licenses required under the laws of Israel, including but not limitedto, permit the non-resident employees of Contractor to perform their duties pursuant to this Agreement (as applicable). Without derogatingfrom the Contractor responsibilities above, Customer shall cooperate with Contractor, as may be reasonably required, in order to obtain suchpermits and licenses. 9.CLEARANCE OF THE SITE; NO INTERFERENCE 9.1The Contractor shall keep the Site and adjacent roads free from unnecessary obstruction and accumulation of waste material or rubbish caused bythe Work. Upon completion of the Work, the Contractor shall clean and remove all construction surplus materials and equipment and rubbish ofevery kind attributable to the Work and/or caused by the Contractor, its employees, agents, subcontractors, suppliers or any other person or entityon its or their behalf (if any) to an authorized waste site and leave the Site and adjacent roads clean. 9.2During the course of the Work, Contractor shall not interfere with, or cause any obstructions to, the Customer and/or the daily operations of theCustomer or the other persons or entities located at the Site. To this extent and without limiting its obligations hereunder, the Contractor shallcoordinate the performance of the Work in advance with Customer, Mr. Darvish Shalom or a representative on his behalf (the “Landlord”), and themunicipality and other authorities as applicable, including regulatory required submissions and permits (achieving of permits is under Customer orLandlord responsibility, as applicable, however the Contractor shall be responsible for the achievement of the technical aspects of the permits).Customer will be responsible to obtain all relevant approvals from the Landlord for the Work and free access to site. 10.CONTRACTOR’S REPRESENTATIONS The Contractor represents and undertakes as follows: 10.1Prior to signing the Agreement, the Contractor read all the Annexes and all documents connected with the performance of the Works. 10.2The Contractor has visited and examined, the site of the Facility (the “Site”), its environs, nature and locality including but not limited to, itslayout and found them suitable for the execution of the Work as stipulated in this Agreement, except for hidden defects and damages. 5CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 10.3The Site is ready for starting the execution of the Work. 10.4The Contractor has the Means, the know-how and the qualifications for the execution of the Works pursuant to this Agreement. 10.5The Contractor has received all the information and required explanations, as to the details and scope of the Works. 11.LIABILITY; INDEMNIFICATION; INSURANCE 11.1The Contractor shall be liable for any damages, demands or claims which may arise in respect of breach of the obligations or provisions applicableto the Contractor pursuant to this Agreement and under any law. 11.2The Contractor shall be liable for, and shall at all times indemnify and hold harmless the Customer, its affiliates, parent company and theirrespective directors, officers, employees and agents from any direct harm (whether physical or mental), damages, expenses (including legal fees)and/or loss of any kind whatsoever, including without limitation, bodily injury and/or property damage arising from any negligent act, omission orbreach of this Agreement by the Contractor and/or its employees and/or its subcontractors and/or all person or entities acting on their behalf, all inaccordance with the applicable laws and regulations. 11.3The Contractor agrees to indemnify and hold harmless and defend at its own expense the Customer, its affiliates, parent company and theirrespective directors, officers, employees, agents from and against any and all claims issued against the Customer as a result of faulty or inadequateperformance made by the Contractor. 11.4The Contractor shall indemnify and hold harmless and defend at its own expense the Customer, its affiliates, parent company and their respectivedirectors, officers, employees, from and against all claims, damages and expenses occurring during the performance and continuance of thisAgreement as a result of faulty or inadequate performance that it is responsible to according to any applicable law or regulation or under theAgreement. 11.5It is clarified that the Contractor’s indemnification obligations hereunder shall not apply to a claim relating to any equipment provided by theCustomer, unless such equipment was not used properly and in accordance with Customer’s instructions by Contractor and/or any person or entityon its behalf. 11.6The Customer undertakes that the Contractor shall be given prompt notice of any claim described in this Section 11 above that is made against theCustomer, its affiliates, parent company and their respective directors, officers, employees. The Contractor shall forthwith defend any such claimsand make settlements thereof at its own expense, provided, however, that any settlement or solution, reached inside or outside of the court, shallnot adversely affect the Customer’s rights under this Agreement or impose any obligations on the Customer in addition to those set forth herein,unless otherwise agreed to by the Customer in writing in advance. Customer shall have the right, but not the obligation, to be represented bycounsel of its own selection and at its own expense. 6CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 11.7Indemnification by Contractor of all costs, expenses and damages to the Customer for any claim for which indemnification was requested shall bemade promptly upon final adjudication and/or settlement of such claim whereby Contractor was held liable and/or responsible therefore. 11.8Without derogating from Contractor’s liability under this Agreement and/or under any law, the Contractor hereby undertakes to take out andmaintain adequate insurance cover with a reputable insurance company against liability which the Contractor or its subcontractor or its employeesmay incur to any other person including but not limited to the Customer in connection with performance of the Agreement in accordance with theprovisions set forth in Annex G. The Contractor shall, on request, produce to the Customer a copy of such insurance certificates. The policies shallname the Customer as an additional insured. Without derogating from the Contractor’s liability pursuant to this Agreement, the Contractorundertakes, at its own expense, to maintain and keep a fully valid insurance policy. 12.PERFORMANCE TESTING; ACCEPTANCE; TRAINING 12.1The Contractor shall perform the testing and qualifications set forth in the Scope of Work, including but not limited to those listed below, all inaccordance with the schedule set forth in the Timetable: (i) DQ tests, (ii) factory acceptance tests, (iii) commissioning tests, and (iv) IQ and OQ tests(all of which tests form the acceptance tests hereunder). Customer shall avail all required personnel and manpower on its part for the IQ and OQtests. Customer shall attend the acceptance tests at its own cost. 12.2The Contractor shall perform the acceptance tests in accordance with (i) the testing criteria set forth in the Scope of Work and (ii) the provisions ofthe Detailed Design. 12.3At such time when the Facility operates in accordance with the provisions of the Scope of Work and the Detailed Design and Customer confirms inwriting the successful completion of all of the acceptance tests, then, subject to the completion of the transactions and procedures set forth inSection 12.5, Customer shall provide a certificate of completion in the form attached hereto as Annex E (the “Certificate of Completion”), atwhich point sign-off and hand-over of the Facility will take place. 12.4In the event that the Customer, or its designated representative, shall determine, that the Facility has not successfully passed any acceptance test,Customer shall advise Contractor in 3 days ,in writing thereof, setting forth the reasons for same to the extent known to the Customer. Upon receiptof said notification, Contractor shall, at its expense, effect the required changes, repairs or replacements of parts, as shall be indicated by Customerin said notification, within 14 (fourteen) days, unless otherwise agreed to in writing by the Customer. Upon completion of such changes, repairs orreplacements, Contractor shall notify Customer, and repeated acceptance tests shall be carried out. The provisions herein contained shall apply toany repeated acceptance tests in whole or in part until all of the separate portions of the Work shall have successfully passed any and all suchacceptance tests. 7CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 12.5Upon successful completion of the acceptance tests: (i) Contractor shall provide Customer with the updated diagrams, plans and any other updateddocumentation of the Facility bearing the signature “As Built” including the date of update; (ii) Contractor shall provide the Customer with amaintenance manual, inclusive of all of the documentation, instructions and protocols (including qualification protocols) and any trainingrequired at this stage according to the Scope of Work, all as required in order to operate and maintain the Facility in accordance with theSpecifications, including but not limited to FDA, EMA, MOH and all other applicable Israeli regulations; (iii) Customer shall provide Contractorwith a Certificate of Completion; 12.6Customer shall be entitled, at its own expense, to bring an independent expert to attend any of the acceptance tests and to advise it as to theperformance of the Facility. 13.CHANGES 13.1The Customer may issue written orders to the Contractor to include changes in the Work, consisting of additions, deletions or other revisions, andcompletion time shall be adjusted accordingly. The Contractor, prior to the commencement of such changed or revised Work, shall submitpromptly to the Customer for Customer’s approval a written proposal for (i) adjustment to the Consideration, and (ii) completion time for suchrevised Work. 13.2Contractor shall not make any changes or substitutions to the Work, including but not limited to the Specifications, approved subcontractors andsuppliers and/or layout of the Facility without the prior written consent of the Customer. For the avoidance of doubt, any change recommended bythe Contractor and agreed to in writing by the Customer shall be deemed as a change order in terms of this Section 13. 14.CONSIDERATION & TERMS OF PAYMENT 14.1The Customer shall pay the following price: 14.1.1A Total Price of NIS [***] (Twenty Million two fifty seven thousand and five hundred New Israeli Shekels) (the “Consideration “) +VAT.Upon receipt of each payment, the Contractor shall submit to the Company a valid tax invoice and receipt. 14.1.2The Customer will pay to Contractor [***] NIS in case Contractor will stand the schedule missions of 23/10/2017. 14.1.3The Customer will to pay Contractor [***] NIS in case Contractor achieves Project Completion Date of December 1st, 2017. 14.2The payments will be remitted in accordance with the provisions set forth in Annex F. The final payment set forth therein shall be made when theWork is fully performed in accordance with the requirements of this Agreement and Customer has issued the Certificate of Completion. 14.3Subject to Section 14.9 below, the Consideration constitutes the full consideration for the Work and includes, for the avoidance of doubt, all theContractor’s expenses including salaries, wages and social benefits, tools, the costs of all Means, storage, or any other expenses incurred incarrying out the Work. 8CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 14.4The Consideration is inclusive of all applicable taxes, with the exception of VAT, which shall be payable under applicable law. The Considerationshall be final and binding and shall not be subject to any escalation or modification, other than as specifically provided herein. The Contractorshall comply with all applicable laws and regulations in the performance of its obligations in respect of the Project and the Work. Without limitingthe generality of the foregoing, the Contractor shall be responsible to pay all taxes, levies, social benefits, insurance payments and any otherpayments required by law in connection with the performance of the Work under this Agreement, including, without limitation, payments to theincome tax authorities, the value added tax authorities, etc., applicable to the Contractor with respect to any and all payments hereunder and/or asan independent contractor and/or for any taxes applicable to payments to its subcontractors, employees or any other person or entity on its behalf. 14.5Customer shall be entitled to deduct any withholding taxes or other taxes from any payment to Contractor hereunder, unless Contractor hasprovided Customer with a certificate of exemption from withholding or other tax. 15.OWNERSHIP 15.1All designs, drawings, specifications, notes and other works developed in the performance of this Agreement shall become the property of theCustomer, shall be deemed Customer’s Confidential Information (as defined below) and may be used by Customer on any other design orconstruction without any additional compensation to the Contractor. Contractor shall not be entitled to use any Confidential Informationincluding without limitation any information and/or know-how of any type or nature and in any form or medium relating to Customer’s processand/or any aspect thereof and/or the layout of any part of the Facility, as may be changed pursuant hereto. All equipment that will provided to sitefor under the scope of project shall become the property of the Customer provided that such costs have been paid to Contractor. 16.CONFIDENTIALITY 16.1During the term of this Agreement and for a period of 5 (five) years thereafter, Contractor shall protect all of Customer’s Confidential Informationdisclosed by Customer or a third party on its behalf or otherwise obtained by the Contractor. Other than as may be required to perform its dutieshereunder, Contractor shall not disclose such Confidential Information to third parties by any means whatsoever. Contractor further agrees not touse Confidential Information disclosed or owned by Customer for any purpose other than for the purpose of this Agreement as contemplatedhereby. The Confidential Information may only be disclosed to those officers, directors, employees, agents and subcontractors (“Representatives”)of the Contractor who have a need to know, and only after such Representatives have been advised of the confidential nature of such informationand agree to be bound by an obligation of confidentiality to the Customer under terms substantially similar to the terms of this Agreement andprovided that the Contractor agrees to be responsible for any breach of this Agreement by any of the Contractor’s Representatives. 16.2The obligations under Section 16.1 above shall not apply to information which: 16.2.1Is or becomes part of the public domain without breach of the provisions hereof or is generally known in the industry; and/or 16.2.2Is lawfully obtained from a third party under no obligation of confidentiality. 9CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 16.3If Contractor is so required to make any disclosure of Customer’s Confidential Information, in response to a valid order by a court or othergovernmental body, or as otherwise required by law, it will give reasonable prior written notice to the Customer of such disclosure requirement andwill use reasonable efforts to secure confidential treatment of such information required to be disclosed. 16.4“Confidential Information” shall include any all notes, data, sketches, drawings, manuals, documents, blueprints, memoranda, specifications, anyof the items , financial reports, equipment, any information and/or know-how of any type or nature and in any form or medium relating to the Work,and this Agreement, the Facility or Customer and/or its business, technology, plans, (including without limitation to Customer’s process and/orany aspect thereof), and/or any other information of a confidential or proprietary nature, whether written or oral, disclosed by the Customer or by athird party on its behalf (including confidential or proprietary information of third parties, subject to a duty on the Customer’s part to maintain theconfidentiality of such information) or obtained by the Contractor in connection with this Agreement its provision of services during or before theterm of this Agreement. 16.5Upon the termination of this Agreement, for any reason, Contractor shall immediately surrender to the Customer all Confidential Information. 16.6Customer shall be the sole and exclusive owner of all Confidential Information. 16.7The Contractor acknowledges and understands that the Customer is a public company traded on the NASDAQ, and accordingly, this Agreementand any Confidential Information may be considered as “inside information” pursuant to securities laws and regulations. 17.WARRANTY 17.1The Contractor warrants that all materials and/or equipment used or supplied under this Agreement are of the best quality, shall be free from defectsdue to faulty design, material and workmanship and that the Work shall conform with the Specifications and Drawings. 17.2Defective materials and/or equipment shall be promptly replaced by the Contractor at its own expense. 17.3Further to the above the Contractor undertakes to repair any system operational defect at its own expense. 17.4The warranty hereunder excludes defects resulting from improper use by the Customer or defective in maintenance. 17.5The Warranty period shall be for a period of 12 (Twelve) months from the date of Certificate of Acceptance (the “Warranty Period”). However in theevent that the Contractor receive a longer warranty period from a third party for any specific item, the warranty with respect to such item shall beextended for the extended period of time. The Bank Guarantee at the Warranty Period shall be equal 5% from the contract price. 18.TERM AND TERMINATION 18.1This Agreement shall enter into force on June 15, 2016 (the “Effective Date”) and shall remain in effect until completion of the Work, unlessotherwise earlier terminated in accordance with this Section 18. 18.2Any actions taken by the parties or cost incurred prior to the Effective Date in preparation or for the performance thereof are for their own accountand at their cost and expense. 10CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 18.3In the event of a material breach of a party’s obligations hereunder, the non-breaching party may terminate this Agreement by providing the otherparty with a prior written notice of termination hereof no less than 14 (fourteen) days prior to such termination becoming effective; providedhowever, that such termination shall not enter into effect if the other party cures such breach prior to the expiration of such 14 (fourteen) dayperiod. 18.4Either party is entitled to terminate this Agreement upon the occurrence of any of the following events: (i) a request for the liquidation and/ordissolution and/or winding up is filed against the other party, which request is not dismissed or otherwise set aside within thirty (30) daysthereafter; (ii) a request for the appointment of a receiver or trustee over a material asset of the other party is filed against the other party with acompetent court of jurisdiction (or execution office), which request is not dismissed or otherwise set aside within thirty (30) days thereafter; or (iii)the other party makes a general assignment for the benefit of its creditors. 18.5The Customer may at any time terminate the Agreement for the convenience of the Customer for any reason and without any default. In the eventof such termination, the Contractor shall receive, as its entire and sole compensation, a settlement computed in the following manner for Work thathas commenced prior to notice of termination under this Section 18.5: 18.5.1Its actual, necessary and reasonable cost for performing the Work to the date of termination, as determined by audit of the Contractor’srecords, including costs for equipment for manufacturing process, provided that such costs have been remitted, are nonrefundable and otherrelevant cost, plus A lump sum of 200,000 (Two Hundred Thousand NIS). 18.6The provisions of Sections 4.4, 4.6, 5.2, 11, 14.4, 14.5, 15, 16, 17, 18, 20, 21 and 23 shall survive termination of this Agreement, for any reason. 19.SUSPENSION The Contractor shall upon the written notification from the Customer suspend the progress of the Work or any part thereof for such period of time and in suchmanner as may be determined by the Customer, and shall during such suspension properly protect and secure (at Customer’s expense) the Work so far as isnecessary in the opinion of the Customer. The extra costs, including that caused by the subsequent resumption of Work incurred by the Contractor incomplying with the Customer’s instructions, shall be borne and paid by the Customer against receipt of supporting documentation, unless such suspension isnecessary due to the fault of the Contractor (or anyone on its behalf). Any such suspension/s shall not exceed in the aggregate, in any event, 30 (Thirty) days. 20.GOVERNING LAW AND JURISDICTION 20.1This Agreement shall be governed and construed in accordance with the laws of the State of Israel. 20.2All technical disputes which cannot be amicably resolved between the parties in 14 days shall be resolved by agreed arbitrator. All other disputesarising from this Agreement which cannot amicably resolved between the parties, shall be finally resolved by The Israeli Institute of CommercialArbitration in accordance with its rules, by one arbitrator. Each of the parties hereby irrevocably submits to the sole and exclusive jurisdiction ofsuch venue. 11CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 20.3In any event of dispute or disagreement between the Contractor and the Customer, it is agreed that the Contractor shall not slow and/or delay theprogress of the Work or suspend the Work, including any Change Order, or hinder in any way the completion and/or delivery thereof. The Workwill continue to be executed as scheduled in spite of any disagreement between the parties, provided that Customer has not ceased, for a period ofmore than 1 (one) consecutive payment milestone, payment of the Consideration when same would become due pursuant to Section 14 above. 20.4The address of the parties for the purpose of service of process shall be as set forth in Section 21 below. 21.NOTICES 21.1All legal notices, requests, consents and other communications required or permitted under this Agreement shall be in writing and shall be (aselected by the person giving such notice) hand delivered by messenger or courier service, sent by facsimile or other electronic means (withconfirmation received of recipient’s number or email receipt) to the number set forth below, or mailed by registered or certified mail (postageprepaid), return receipt requested, or delivered by overnight delivery service, addressed to: If to Customer: Vascular Biogenics Ltd.6 Yonni Netanyahu St. Or-Yehuda IsraelFacsimile: [***]Email: [***]Attention: [***] If to Contractor: Biopharmax Group Ltd.4 Hasadnaot St.Herzelia 46728IsraelFacsimile: [***]Email: [***]Attention: [***] 21.2Each such notice shall be deemed delivered: (a) on the date delivered if by personal delivery (including by an overnight delivery service, withproof of delivery); (b) on the date telecommunicated if by facsimile or other electronic means (with confirmation of receipt); and (c) on the dateupon which the return receipt is signed or delivery is refused, as the case may be, if mailed certified, return receipt requested. 22.FORCE MAJEURE 22.1Any delay in or failure of performance except as specified in Section 22.4 below by either party shall be excused if and to the extent that same hasbeen caused by an event, incident or occurrence constituting Force Majeure under the terms of Section 22.3 below. 22.2Each party shall not be entitled to avail itself of the provisions of Section 22.1 above and said provisions shall not apply to any event, occurrenceor incident constituting Force Majeure and affecting its performance unless such party shall notify the other party in writing of the occurrence ofsuch event no later than 5 (five) working days from its occurrence, setting forth the estimated effect thereof on the performance of its obligationsand undertakings hereunder. 12CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 22.3For the purpose hereof, “Force Majeure” shall mean any one or more of the following events, occurrences and incidents directly creating any suchdelay in or failure of performance: (a)Floods, hurricanes and earthquakes and other natural disasters and occurrences; (b)General riots and strikes (not solely by a party’s employees) and civil disturbances; (c)War, blockades, sabotage, war-like and terror actions, and general mobilization of reserves; (d)Epidemics and wide spread diseases. 22.4Notwithstanding the above, it is agreed that no reason whatsoever, including without limitation, any event, incident or occurrence constitutingForce Majeure in terms of this Agreement shall serve as an excuse for non-conformity of the Work to the provisions (except for timetables) of thisAgreement. 23.MISCELLANEOUS 23.1Each of the parties hereby represents and warrants to the other party that it has full right and authority to enter into this Agreement and to performits obligations hereunder and that this Agreement constitutes its valid and binding obligation, enforceable against it in accordance with its terms. 23.2Customer shall be entitled to assign its rights to any Affiliate upon written notice to the Contractor. Contractor shall not be entitled to assign itsrights or obligations hereunder without the prior written consent of the Customer and any assignment or transfer not in accordance with the termsand conditions of this Agreement shall be null and void. 23.3The provisions of this Agreement are severable and, in the event that any court of competent jurisdiction determines that any one or more of theprovisions or part of a provision contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect,such invalidity, illegality or unenforceability shall not affect any other provision or part of a provision of this Agreement; but this Agreement shallbe reformed and construed to the maximum extent possible as if such invalid, illegal or unenforceable provision, or part of a provision, had neverbeen contained herein. 23.4Nothing contained in this Agreement shall be deemed to establish any partnership, joint venture or agency relationship and the parties shall act atall times as independent contractors. Unless otherwise expressly provided herein, the employees of each party to this Agreement shall in no eventbe deemed employees of the other party by reason of this Agreement, and such employees shall not be entitled to participate in any benefitsprovided by such other party to its employees. Neither party shall have any authority to enter into any contracts, assume any obligations or makeany warranties or representations on behalf of the other party. 23.5This Agreement may not be amended, modified, altered, or supplemented except by a written agreement executed by both parties hereto. 23.6This Agreement and the Schedules attached hereto set forth the entire understanding between the parties hereto and supersedes all prioragreements, arrangements and communications, whether oral or written, with respect to the subject matter hereof. 23.7This Agreement may be executed in counterparts (including counterparts transmitted by fax or email via PDF), each of which shall be deemed to bean original, but all of which taken together shall be deemed to constitute one and the same instrument. 23.8The Contractor will comply with the relevant sections of the Customer’s Code of Business Conduct and Ethics, a copy of which is presented at theCompany’s web site (http://ir.vblrx.com/phoenix.zhtml?c=253311&p=irol-govhighlights). The Contructor has not taken and shall not take anyaction that would cause the Customer to violate any (i) applicable laws and regulations, including the U.S. Foreign Corrupt Practices Act of 1977and similar laws of any applicable country or other jurisdiction and (ii) the relevant sections of the Customer’s Code of Business Conduct andEthics. 13CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. IN WITNESS WHEREOF, the parties have signed this Agreement as of the Effective Date first herein above set forth. Vascular Biogenics Ltd. Biopharmax Group Ltd. SIGNATURE: SIGNATURE: NAME: NAME: TITLE: TITLE: 14CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Scope of Work- Annex B 1.General scope: 1.1.The GMP Facility will be constructed in existing building shell with approximate area of [***] sq.m, as detailed below: 1.2.Ground floor +0.00: 1.2.1.Production Clean Rooms (Grade C, B): [***] sq.m 1.2.2.NC: [***] sq.m 1.2.3.Warehouse: [***] sq.m 1.2.4.CNC corridor: [***] sq.m 1.2.5.Cell Bank Storage: [***] sq.m 1.2.6.Cold room: [***] sq.m 1.2.7.Packaging: [***] sq.m 1.2.8.Utilities [***] sq.m 1.2.9.Future area: [***] sq.m 1.3.Middle Floor +2.87: 1.3.1.Technical Area: [***] sq.m 1.4.First floor +5.55: 1.4.1.Laboratory: [***] sq.m 1.4.2.Offices: [***] sq.m 1.4.3.Future area: [***] sq.m 1.5.Work includes design, procurement, installation and commissioning/validation (including all relevant paper work- URS etc.) 2.Clean rooms Construction works: 2.1.Clean room wall panels, doors, windows 2.2.Round corner floor/wall, wall/wall, wall/ceiling 2.3.Walkable Ceiling 2.4.Flooring: PVC/ Epoxy 2.5.All CR associated equipment to be installed- sinks, shelves, chairs etc. 2.6.Cold room 2-8C. 1CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 3.General Construction works: 3.1.General gypsum walls (fire rated when required) 3.2.Doors, windows 3.3.Glass wall in management offices 3.4.False Ceiling 3.5.Flooring: tiles/Parquet 3.6.Archive 3.7.All supporting aids to allow proper maintenance 4.HVAC systems: 4.1.HVAC System for the clean rooms 4.2.HVAC System for the labs offices and warehouse 4.3.HVAC system for offices and supporting areas (maintenance workshop, servers room) 4.4.200TR chiller and piping 5.Utilities Systems: 5.1.OFA Generation and Distribution system 5.2.Gasses- [***] CA Distribution system (cylinders by client) 5.3.Purified water system (pretreatment, ESR, HOD, RO and WFI generation and distribution) and optional distillation unit 5.4.Municipal Drain including connection to main building system 5.5.Process waste with storage tanks, and pH + neutralization (hypochlorite) systems+ all relevant drains. 5.6.City water/ Hot Water including connection to main building system 5.7.Process glycol chiller 5.8.Outside utilities area will be durable to weather conditions 6.Electrical systems 6.1.Electrical distribution to all consumers (supply from grid 400V 3ph) 6.2.Electrical and Control Panels 6.3.Electrical Generator 6.4.UPS 6.5.Server for HMI 2CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 6.6.Electrical, Communication and Control Sockets 6.7.Lighting system 6.8.Approval of testing electrical engineer according to Israeli law. 7.Fire Protection and detection 7.1.Sprinklers piping, including connection to main building piping system, also for CR (per cGMP requirements) 7.2.Fire detection system, including integration with main building piping system 7.3.O2 depletion detectors 7.4.Fire Department approval for the facility (design and execution). 8.Low voltage systems 8.1.Computer network (infrastructure only, excluding end sockets) 8.2.Telephone network (infrastructure only, same as electric cables 6.1, excluding end sockets) 8.3.Door interlock electric system for clean rooms 8.4.Access Control system for cleanrooms 8.5.Access Control for non-clean area (infrastructure only) 8.6.Intercom system (4 points, additional point will be infrastructure only-for CR. Infrastructure for non CR) 8.7.Public announcement and alarm system 8.8.CCTV (infrastructure only) 3CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 9.Instrumentation and automation 9.1.Automatic control program for the HVAC and process systems based on PLC, adjusting the temperature, humidity and pressure 9.2.Visualize and print data for process SUMs in production 2 room. 9.3.Pressure indication from the gas systems 9.4.Temperature and CO2 and humidity monitoring for Client equipment: Incubators, Freezers, refrigerators (measurement instruments insideequipment will be supplied by Client) 10.Process equipment (second hand): [***] [***] [***] [***] 11.Furniture 11.1.Labs:, relocation of furniture from existing lab in Or Yehuda additional Chemical Hood, working bench, Lab Sink Cabinet per layout 11.2.Clean room furniture 11.3.Kitchenette: Lower Kitchenette Cabinet 11.4.Coffee room 11.5.Offices & meeting rooms (by client) 11.6.Warehouse: warehouse shelves 11.7.Maintenance workshop 4CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 12.Commissioning, Qualification and Validation (writing and execution): *DQ, IQ, OQ refer to Validation System/Equipment DQ IQ OQ PQ Commissioningonly (IC,OC)Building and rooms (non GMP, CNC+NC) - - - - ✓HVAC system (Including Interlock system) ✓ ✓ ✓ ✓ -Clean Rooms ✓ ✓ ✓ ✓ -Control and Monitoring System (Including HVAC system) ✓ ✓ ✓ ✓ -Oil Free Air ✓ ✓ ✓ ✓ -Chilled Water - - - - ✓Process Gas (N2,CO2,O2,CAS- cylinders) ✓ ✓ ✓ ✓ -WFI ✓ ✓ ✓ ✓ -Electricity - - - - ✓Emergency Power Generator - - - - ✓UPS power source - - - - ✓Fire Safety systems - - - - (1)Intercom System in clean rooms - - - - (2)Process waste system - - - - ✓Glycol System ✓ ✓ ✓ ✓ - *according to VBL criticality assessment document 13-40(1) As per Standard Institution of Israel(2) Function/operation testing 5CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. 13.Excluded: 13.1.Computer Network and Server 13.2.Telephone Network 13.3.Offices Furniture 13.4.Gas cylinders 13.5.Process equipment unless specified 13.6.LN2 Dewar and cell bank 13.7.Transformation station (civil and equipment) 13.8.Additional work not specified in this scope of work 6CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. CERTIFICATE OF ACCEPTANCE – ANNEX E The Customer confirms that all works has been concluded to his satisfaction and in compliance with the agreement dated _____________ and its annexes,with exception to the following remarks which shall be corrected by the Contractor within the time limits set forth hereunder: Remarks Description Last Date forCorrection. DATE: _____________ SIGNED BY: Contractor:Customer: CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED.  CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Annex I CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED AND REPLACED WITH “[***]”. ACOMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECRETARY OF THESECURITIES AND EXCHANGE COMMISSION PURSUANT TO AN APPLICATION REQUESTING CONFIDENTIALTREATMENT PURSUANT TO RULE 24B-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934,AS AMENDED. Annex J   Exhibit 12.1 I, Dror Harats, certify that: 1.I have reviewed this annual report on Form 20-F of Vascular Biogenics Ltd.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; 4.The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for thecompany and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensurethat material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annualreport that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and 5.The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to thecompany’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the company’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control overfinancial reporting. Date: March 15, 2018 /s/ Dror Harats Dror HaratsChief Executive Officer   Exhibit 12.2 I, Amos Ron, certify that: 1.I have reviewed this annual report on Form 20-F of Vascular Biogenics Ltd.; 2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; 4.The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in ExchangeAct Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for thecompany and have: (a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensurethat material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities,particularly during the period in which this report is being prepared; (b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for externalpurposes in accordance with generally accepted accounting principles; (c)Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectivenessof the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d)Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annualreport that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and 5.The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to thecompany’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): (a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the company’s ability to record, process, summarize and report financial information; and (b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control overfinancial reporting. Date: March 15, 2018 /s/ Amos Ron Amos RonChief Financial Officer   Exhibit 13.1 CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES- OXLEY ACT OF 2002 In connection with the Annual Report of Vascular Biogenics Ltd. (the “Company”) on Form 20-F for the period ended December 31, 2017 as filed withthe Securities and Exchange Commission (the “Report”), I, Dror Harats, Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C.Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge: (1) the Report fully complies with the requirements of section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: March 15, 2018 /s/ Dror Harats Dror HaratsChief Executive Officer In connection with the Annual Report of Vascular Biogenics Ltd. (the “Company”) on Form 20-F for the period ended December 31, 2017 as filed withthe Securities and Exchange Commission (the “Report”), I, Amos Ron, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge: (1) the Report fully complies with the requirements of section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: March 15, 2018 /s/ Amos Ron Amos RonChief Financial Officer   Exhibit 15.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-202463; 333-210583; 333-219969 and 333-223232) and F-3 (No. 333-207250 and 333-222138) of Vascular Biogenics Ltd. of our report dated March 12, 2018 relating to the financial statements,which appears in this Form 20-F. /s/ Kesselman & KesselmanTel-Aviv, IsraelKesselman & KesselmanMarch 15, 2018Certified Public Accountants (Isr.) A member firm of PricewaterhouseCoopers International Limited  

Continue reading text version or see original annual report in PDF format above