Employment Agreement Duly made and executed on the date set forth in Appendix 1 By and Between Advanced Inhalation Therapies (AIT) Ltd. (hereinafter the "Company") and Hai Aviv (hereinafter the "Employee") (other details as set forth in Appendix 1)

It is clarified that the Employee shall bear any and all taxes, which may apply with respect to any contribution, which exceeds the recognized tax ceilings with respect to the Pension Insurance.

3.7.

Education Fund. The Employee is entitled to Education Fund payments from the date indicated in Appendix 1 (if at all) as follows:

3.7.1.

The Company shall pay a sum equal to a percentage that is detailed in Appendix 1 of the Maximum Salary for Education Fund and (ii) shall deduct a percentage that is detailed in Appendix 1 from the Maximum Salary for Education Fund to be paid on behalf of the Employee toward a further education fund. Use of this fund shall be in accordance with the policies of the relevant fund.

3.7.2.

The term "Maximum Salary for Education Fund" as used herein shall mean an amount equal to the lower of (i) the Gross Salary of the Employee, or (ii) the highest amount recognized by the Israeli Tax Authorities for income tax exemption regarding education fund payments.

3.8.

Military Reserve Duty. Employee shall inform the company of any military reserve duty employee has been ordered to perform, immediately after he/she has been notified of the same. Employee undertakes to provide company with proper confirmation of active military reserve duty, so that company may collect from the national insurance institute all amounts to which employee or company is entitled in connection with such service.

 

3.9.

CAR LEASING.

If stated in Appendix 1 that the Employee is entitled to join the Company's car leasing program, the Company shall deduct the required amounts associated with the leasing and the use of a leased car (the “Leasing Car”) from the Employees Gross Salary. The Employee shall be liable for any income tax liability applicable to his use of the Leasing Car (in addition to bearing the usage cost as mentioned above). It is further clarified that the deduction of the usage cost of the Leasing Car will also reduce the Gross Salary for calculating the social benefits that the Employee is entitled to.

The use of the Leasing Car shall be in accordance with the relevant policies and regulations of the Company and according to the terms and conditions as determined by the leasing company. If required by the Company, the employee will execute additional documents with respect to the use of the Leasing Car, including without limitation, the applicable leasing agreement between the Employee and the applicable leasing company indicated by the Company at such time.

In event the Cellular Phone number is registered with the cellular service company in the name of the Company, upon the Company's first demand, the Employee shall immediately transfer the Cellular Phone on his name.

4.1.

Confidentiality to Terms. The Employee agrees to keep all the terms and conditions of this Agreement in strict confidence and not to disclose them to any person without the prior written consent of the Company unless as required by the relevant laws and regulations.

4.2.

Non-Disclosure and Non-Competition Agreement. Concurrently with the execution of this Agreement, the Employee is executing the Non-Disclosure and Non-Competition Agreement, which is attached hereto as Appendix 2, and which is an integral part hereof.

4.3.

Monitoring of Systems. The Company's Systems (as defined below) or access which is provided to the Employee are and shall remain the sole property of the Company. The Employee shall use such Systems for business purposes only. To ensure the security of such Systems and to protect the Company's confidential and proprietary information, the Company reserves the right, and the Employee hereby agrees that the Company and anyone on its behalf may, at any time and for any purpose, monitor the Employee's use of the Systems and monitor, copy, transfer and disclose all electronic communications and content transmitted by or stored in such Systems, regardless of the location, time or purpose of such use (other than protected private use in accordance to law).  For the purposes of this Section 4.3, "Systems" include any equipment and software of any kind, including Employee's computer, Company's mailbox, Company's and/or Employee's telephone, etc. Employee acknowledges and approves that the provisions of this Section 4.3 are reasonable in light of the Employee's position with the Company, in the course of which the Employee has and shall gain broad knowledge of the Company's Proprietary Information.

4.4.

Survival. Sections 4 above will remain in full force and effect after termination of this Agreement.

5.1.

The Employee has the knowledge, abilities and skills required to perform the duties of his position.

5.2.

The Employee shall inform the Company, immediately upon becoming aware of any matter in which he or a member of his immediate family or affiliate has a personal interest or which might create a conflict of interests with his duties under this Agreement.

5.3.

In carrying out his duties under this Agreement, the Employee shall not make any representations, or give any guaranties on behalf of the Company, except as authorized to do.

5.4.

The Employee represents and warrants that on the date hereof he is free to provide services to the Company upon the terms contained in this Agreement and that there are no employment contracts, consulting contracts or restrictive covenants preventing full performance of his duties hereunder.

5.5.

The Employee represents and warrants that he will not use during the course of his employment with the Company any trade secrets or proprietary information that is the property of his previous employer(s) in such a manner that may breach any confidentiality or noncompetition agreement or other obligation the Employee may have with such former employer(s).

6.1.

In this Agreement words importing the masculine gender shall include the feminine gender.

6.2.

This Agreement shall not be amended, modified or varied by any oral agreement or representation or otherwise than by written instrument executed by either parties or their duly authorized representatives.

6.3.

This Agreement is personal to the Employee, and the Employee shall not assign or delegate his rights or duties to a third party, whether by contract, will or operation of law, without the Company's prior written consent.

6.4.

This Agreement shall inure to the benefit of the Company's successors and assigns.

6.5.

Each notice and/or demand given by one party pursuant to this Agreement shall be given in writing and shall be sent by registered mail to the other party at the address appearing in the caption of this Agreement, and such notice and/or demand shall be deemed given at the expiration of seven (7) days from the date of mailing by registered mail or immediately if delivered by hand.  Such address shall be effective unless notice of a change in address is provided by registered mail to the other party.

6.6.

It is hereby agreed between the parties that the laws of the State of Israel shall apply to this Agreement. The legally authorized courts in the district of Tel Aviv, Israel, shall have exclusive jurisdiction over the parties hereto and subject matter hereof.

6.7.

No Waiver. No delay, failure, or forbearance to exercise any right, power, or remedy accruing to either party upon breach or default under this Agreement shall be deemed a waiver of any prior or subsequent breach or default of this Agreement, nor affect the validity of any provision of this Agreement.

6.9.

Severance. If any one or more of the terms of this Agreement shall for any reason be held to be invalid or unenforceable, such term shall be construed in a manner to enable it to be enforced to the extent compatible with applicable law. Any determination of the invalidity or unenforceability of any provision of the Agreement shall not affect the remaining provisions hereof unless the business purpose of this Agreement is substantially frustrated thereby.

 

6.11.

The above and the said in the appendixes shall be without prejudice to any right conferred to the Employee by any law, Extension Order or Collective Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written:

I acknowledge that as a result of my employment by Advanced Inhalation Therapies (AIT) Ltd. (the "Company"), I may develop, receive, or otherwise have access to confidential or proprietary information that is of value to the Company. I therefore agree, as a condition of my employment, as follows:

1.1.

Recognition of Company's Rights; Non - disclosure.  At all times during my employment and thereafter, I will hold in strictest confidence and will not disclose, disseminate, use, copy, lecture upon or publish in any manner or fashion whatsoever, any of the Company's Proprietary Information (as such term is defined below), except as such disclosure, use or publication may be required in connection with my work for the Company, or unless an officer of the Company expressly authorizes such in writing in advance. I will obtain the Company's written approval before publishing or submitting for publication any material (written, verbal, or otherwise) that relates to my work at the Company and/or incorporates any Proprietary Information. I hereby assign to the Company any rights I may have or acquire in such Proprietary Information and recognize that all Proprietary Information shall be the sole property of the Company and its assigns.

1.2.

Proprietary Information.  The term "Proprietary Information" shall mean any and all confidential and/or proprietary knowledge, data or information of the Company.  By way of illustration but not limitation, "Proprietary Information" includes (a) trade secrets, inventions, pending patents, mask works, ideas, processes, formulas, source and object codes, data, programs, other works of authorship, know-how, improvements, inventions, discoveries, developments, designs and techniques (excluding inventions that are not assignable under Section 2.4, hereinafter collectively referred to as "Inventions"); and (b) information regarding plans for research, development, new products, marketing and selling, business plans, budgets and any unpublished financial statements and/or information, licenses, strategies, forecasts and projections, prices and costs, suppliers and customers; (c) information regarding the skills and compensation of other employees, management or other personnel of the Company; and (d) information that is disclosed in the furtherance of the business of the Company including, without limitation, the area of activity in which the Company is involved, the Company’s technical, business and financial information, documentation, records, files, memoranda, reports, drawings, plans, price lists, customer lists, and the like. Notwithstanding the foregoing, it is understood that, at all such times, I am free to use information which is generally known in the trade or industry, which is not gained as result of a breach of this Agreement, to whatever extent and in whichever way I wish.

1.3.

Third Party Information.  I understand, in addition, that the Company has received and in the future will receive from third parties confidential or proprietary information ("Third Party Information") subject to a duty on the Company's part to maintain the confidentiality of such information and to use it only for certain limited purposes.  During the term of my employment and thereafter, I will hold Third Party Information in the strictest confidence and will not disclose to anyone (other than Company personnel who need to know such information in connection with their work for the Company) or use, except in connection with my work for the Company, Third Party Information unless expressly authorized by an officer of the Company in writing.

1.4.

No Improper Use of Information of Prior Employers and Others. During my employment with the Company, I will not improperly use or disclose any Proprietary Information and/or confidential information or trade secrets, if any, of any former employer or any other person to whom I have an obligation of confidentiality, and I will not bring onto the premises of the Company any unpublished documents or any property belonging to any former employer or any other person to whom I have an obligation of confidentiality unless consented to in writing by that former employer or person.

2.1.

Proprietary Rights.  The term "Proprietary Rights" shall mean all trade secret, patent, copyright, mask work and other intellectual property rights throughout the world.

2.2.

Prior Inventions.  I hereby confirm that I have transferred and assigned in whole to the Company any and all of my rights, title and interest in any and all Inventions, which are currently being used or contemplated to be used by the Company on the date hereof.  Notwithstanding the foregoing, other than inventions referred to in the immediately preceding sentence, inventions, if any, patented or unpatented, which I made prior to the commencement of my employment with the Company ("Prior Inventions") are excluded from the scope of this Agreement.  If, in the course of my employment with the Company, I incorporate a Prior Invention into a Company product, process or machine, the Company is hereby granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual, unlimited worldwide license (with rights to sublicense through multiple tiers of sublicenses) to make, have made, modify, use and/or sell and/or otherwise use as the Company may wish, such Prior Invention. Without derogating from the foregoing, I agree that I will not incorporate, or permit to be incorporated, Prior Inventions in any Company Inventions without the Company's prior written consent.

Prior Inventions: _________ [Please List all Prior Inventions (if any)]

2.3.

Assignment of Inventions. I will promptly disclose to the Company, or any persons designated by it, all Inventions made or conceived or reduced to practice or learned by me, either alone or jointly with others, during the employment term, as a result of tasks assigned by the Company or as a result of the use of premises and/or equipment owned, leased, or contracted for by the Company.  Furthermore, subject to Section 2.4, I hereby assign and agree to assign in the future (when any such Inventions or Proprietary Rights are first reduced to practice or first fixed in a tangible medium, as applicable) to the Company all my right, title and interest in and to any and all Inventions (and all Proprietary Rights with respect thereto) whether or not patentable or registrable under copyright or similar statutes, made or conceived or reduced to practice or learned by me, either alone or jointly with others, during the period of my employment with the Company and which are connected and/or related to the Company's business and which have been created or developed as part of my work for the Company. Inventions assigned to the Company, or to a third party as directed by the Company pursuant to this Section 2, are hereinafter referred to as "Company Inventions".

2.4.

Government or Third Party.  I also agree to assign all my right, title and interest in and to any particular Company Invention to any third party, including without limitation government agency, as directed by the Company.

2.5.

Works made for Hire. I further acknowledge that all original works of authorship which are made by me (solely or jointly with others) within the scope of and during my employment with the Company are “works made for hire” as contemplated under Chapter H of the Patents Law of 1967 (the “Patents Law”), that all such “works made for hire” are owned by the Company, its successors, assigns or nominees, and that I shall not be entitled to any compensation, other than the Gross Salary, for creation or assignment of the same to the Company, its successors, assigns or nominees; it being acknowledged and agreed that the Gross Salary and all  other employment terms under the Employment Agreement shall constitute the sole consideration and remuneration for any Inventions, including, without limitation, “works made for hire”, regardless of the current or future value of the Invention. I understand and agree that the decision whether or not to commercialize or market any invention developed by me (including the Inventions), solely or jointly with others, is within the Company’s sole and unfettered discretion and for the Company’s sole benefit and that no royalty will be due to me as a result of the Company’s efforts to commercialize or market any such invention (including the Inventions). This Section 2.5 shall be deemed as an “agreement” for purposes of Section 134 of the Patents Law.

2.6.

I acknowledge and agree that in event that, notwithstanding the agreement stipulated herein, it will be decided by a competent authority, court or any other competent tribunal, either due to my application or any other source, that I may deserve additional compensation for Company Inventions, in addition to any amounts paid to me by the Company under and according to my employment agreement (a "Claim"), my Gross Salary (as defined in the Agreement) shall be reduced, retroactively effective as of the date of the beginning of my employment by the Company to an amount equal to 80% (eighty percent) of the Gross Salary actually paid to me by the Company (the “Agreed Alternative Payment”) and I shall be obligated to return to the Company, on the day the Claim was made and/or the demand which contradicts this Agreement was made, all additional amounts that I received from the Company beyond the Agreed Alternative Payment, retroactively from my employment Start Date onward (the “Excess Amount”), plus interest as of the original date of payment thereof. I acknowledge that the Company shall be entitled to set off such Excess Amounts against all amounts that I shall be entitled to under the Agreement, or under the decision of the Court or of any other competent tribunal or authority. Such set-off shall not derogate from the Company's right to collect any additional amounts from me.

In addition, I undertake, by signing this Agreement that I will not, directly or indirectly, make a claim and /or sue and/or demand, from the Company and/or any of its officers, employees and shareholders any additional compensation for creation or assignment of Inventions beyond the amounts paid to me by the Company according to my Employment Agreement.

2.7.

Copyright Works. Without derogating from the forgoing, I acknowledge that all original works of authorship which are made by me (solely or jointly with others) within the scope of my employment and which are protectable by copyright are the property of the Company pursuant to applicable copyright law.

2.8.

Enforcement of Proprietary Rights. I will assist the Company in every proper way to obtain, and from time to time enforce, any Proprietary Rights relating to Company Inventions in any and all countries. To that end I will execute, verify and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, evidencing, sustaining and enforcing such Proprietary Rights and the assignment thereof.  In addition, I will execute, verify and deliver assignments of such Proprietary Rights to the Company or its designee. My obligation to assist the Company with respect to Proprietary Rights relating to such Company Inventions in any and all countries shall continue beyond the termination of my employment, but the Company shall compensate me at a reasonable rate, to be discussed with the Company, after my termination for the time actually spent by me at the Company's request on such assistance, subject to my consent, which will not be withheld for unreasonable reasons.

2.9.

Power of Attorney.  In the event the Company is unable for any reason, after reasonable effort, to secure my signature on any document needed in connection with the actions specified in Section 2.8 hereof, I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact, which appointment is coupled with an interest, to act for and in my behalf to execute, verify and file any such documents and to do all other lawfully permitted acts to further the purposes of the preceding paragraph with the same legal force and effect as if executed by me.  I hereby waive and quitclaim to the Company any and all claims, of any nature whatsoever, which I now or may hereafter have for infringement of any Proprietary Rights assigned hereunder to the Company.

I agree to keep and maintain adequate and current records (in the form of notes, sketches, drawings and in any other form that may be required by the Company) of all Proprietary Information developed by me and all Inventions made by me during the period of my employment at the Company, which records shall be available to and remain the sole property of the Company at all times.

I acknowledge that I have carefully reviewed the provisions of this Agreement, the Employment Agreement and the appendices thereof, fully understand the consequences thereof, and have assessed the respective advantages and disadvantages to me in entering into this Agreement. In light of the aforesaid, I agree that, during the period of my employment by the Company and for a period of one (1) year thereafter, I will not, directly or indirectly, carry on or engage in any employment or business activity, or hold an interest in any business, either as an employee, owner, partner, agent, shareholder, director, consultant or otherwise, which is competitive with the business of the Company ("Competitive Activity"). I agree further that for the period of my employment by the Company and for a period of one (1) year thereafter, I will not induce, solicit, employ or entice away or endeavor to solicit, employ or entice away any employee of the Company to leave the employ of the Company or to perform any Competitive Activity. In addition, I agree not to solicit, canvass or approach or endeavor to solicit, canvass or approach any person who was provided with services by the Company or its subsidiaries, or has provided services to the Company or its subsidiaries, at any time during the twelve (12) months immediately prior to the termination date of this Agreement, for the purpose of offering services which are competitive with those provided by the Company. I acknowledge that due to my position, the Proprietary Information I am and shall be exposed to and the nature of the business of the Company - any Competitive Activity performed by me will severely harm the legitimate rights and interests of the Company, including but not limited to its Proprietary Rights. In light of all the foregoing I acknowledge that this non-competition undertaking is reasonable, proportional and does not exceed the minimum required to protect the Company's legitimate rights and interests. I warrant and represent that the Special Non-Compensation Monthly Compensation (as such term is defined in the Employment Agreement) constitutes a real, appropriate and full consideration to any prejudice I may suffer due to my undertaking not to engage with any Competitive Activity, including but not limited to any restriction to my freedom of employment.

I represent that my performance of all the terms of this Agreement and as an employee of the Company does not and will not breach any agreement to keep in confidence information acquired by me in confidence or in trust prior to my employment by the Company. I have not entered into, and I agree not to enter into, any agreement, written or oral in conflict herewith.

When I leave the employ of the Company, I will deliver to the Company any and all drawings, notes, memoranda, specifications, devices, formulas, and documents, together with all copies thereof, and any other material containing or disclosing any Company Inventions, Third Party Information or Proprietary Information of the Company.

In the event that I leave the employ of the Company, I hereby consent to the notification of my new employer of my rights and obligations under this Agreement.

8.1.

Severability. I acknowledge that the provisions of this Agreement serve as an integral part of the terms of my employment and reflect the reasonable requirements of the Company in order to protect its legitimate interests with respect to the subject matter hereof. In case any one or more of the provisions 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 the other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. If moreover, any one or more of the provisions contained in this Agreement shall for any reason be held to be excessively broad as to duration, geographical scope, activity or subject, it shall be construed by limiting and reducing it, so as to be enforceable to the extent compatible with the applicable law as it shall then appear.

8.2.

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

8.3.

Survival. The provisions of this Agreement shall survive the termination of my employment and the assignment of this Agreement by the Company to any successor in interest or other assignee.

8.4.

Waiver.  No waiver by the Company of any breach of this Agreement shall be a waiver of any preceding or succeeding breach.  No waiver by the Company of any right under this Agreement shall be construed as a waiver of any other right.  The Company shall not be required to give notice to enforce strict adherence to all terms of this Agreement.

8.5.

Entire Agreement. The obligations pursuant to Sections 1 and 2 of this Agreement shall apply to any time during which I was previously employed (if at all), am or will be in the future employed, by the Company, including as a consultant if no other agreement governs nondisclosure and assignment of inventions during such period. This Agreement is the final, complete and exclusive agreement of the parties with respect to the subject matter hereof and supersedes and merges all prior discussions or agreements between us with respect to the subject matter hereof. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing and signed by the party to be charged. Any subsequent change or changes in my duties, salary or compensation will not affect the validity or scope of this Agreement.

8.6.

Governing Law. This Agreement shall be governed by, and construed in accordance with the laws of the State of Israel, without giving effect to the rules respecting conflict-of-law.

8.7.

Jurisdiction. The legally authorized courts in the district of Tel Aviv, Israel, shall have exclusive jurisdiction over the parties hereto and subject matter hereof.

This Agreement shall be effective as of the date the Employment Agreement of the Employee was made effective.

I HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS.

ACCEPTED AND AGREED TO: