UNPROTECTED TENANCY AGREEMENT

1.

Introduction

(a)

The recitals hereto constitute an integral part hereof.

(b)

The Kibbutz’s representative in all respects relating to this agreement shall be the Kibbutz lettings manager and/or such person as from time to time appointed for the purpose by the Kibbutz management.

(c)

Any previous agreement and/or memorandum of agreement made between the parties, either in writing or orally, is hereby revoked, ex abundanti cautela , without any mutual demand or complaint.

(d)

The headings below are solely for the sake of convenience and shall not be applied in the interpretation of the clauses.

2.

The Tenancy Terms

The Landlord hereby lets the premises to the Tenant and the Tenant hereby rents them from the Landlord for a term of 12 + 12 months, namely until 31st December 2010, at which time this agreement and the relationship between the parties shall come to an end and the Tenant shall be liable to vacate the premises and return possession of them to the Landlord, unless they first reach another signed, written agreement. The Tenant shall have a right of first refusal to use the premises for one further term of 12 months, provided that the following conditions are fulfilled -

(a)

The Tenant shall give written notice thereof to the Landlord 60 days in advance shortly before the end of the said term.

(b)

The Tenant shall have performed his obligations in accordance with this agreement in full and on time.

(c)

The premises and/or the site of the premises shall not then be needed by the Kibbutz for purposes of construction and/or a real estate project or for another use as determined by the Kibbutz in its discretion.

(d)

No written objection has been received from the regional council or the Administration in respect of the use of the premises as defined in the “object of the tenancy”.

(e)

The monthly rent during the additional term of the tenancy shall be increased by 5% in comparison with the rent during the previous term, and if the option term is for several years, the rent shall be increased by 5% in comparison with the previous year of the tenancy.

3.

The Tenant acknowledges that the premises are property that since 5728 was vacant of any tenant entitled to occupy them and the Tenants’ Protection Law (Consolidated Version), 5732-1978 shall not apply to the tenancy herein and that he will not be protected under the Tenants’ Protection Law and/or any other legislation now existing or enacted in the future (hereinafter referred to as “the Tenants’ Protection Law”).

The Tenant warrants that he has not made or undertaken to make any payment whatsoever to the Landlord, either directly or indirectly, as key money or any other benefit or payment for the tenancy of the premises, other than the rent as set out below and he hereby waives in advance any demand for the rent as set out below and he hereby waives in advance any demand for key money or any other payment of any type whatsoever or for any amount whatsoever. He acknowledges and agrees that the provisions of the Tenants’ Protection Law that deal with key money will not apply to the tenancy of the premises.

4.

The Object of the Tenancy

The object of the tenancy is solely for using the premises merely for the office business of the Tenant.

The Tenant may not alter the object of the tenancy or use the premises otherwise than in accordance with the object of the tenancy and no plea shall therefore be admissible that it has been agreed to alter the object of the tenancy, unless the same is done with the prior written consent of the Landlord.

5.

The Rent

In consideration for the tenancy of the premises the Tenant shall pay the Landlord the shekel equivalent of

in the manner and at the times following (hereinafter referred to as “the rent”) -

(a)

The first payment of the rent for three months shall be made on signing this agreement.

(b)

The rent shall be paid once monthly in advance.

(c)

The rent shall be subject to the addition of VAT at the rate thereof on the date of payment. The Tenant shall be given a tax invoice.

(d)

To facilitate collection of the rent, the Tenant shall deposit with the Landlord 12 cheques in the sum of NIS 2,475.5 each, maturing on the second day of each month, as a condition for receiving a key to the premises and possession of them being delivered to the Tenant as set out in this agreement. The accounting in respect of rate differences shall be made three-monthly and in accordance with the results of the accounting the Tenant shall pay the Landlord  the rate differences, plus VAT and the Landlord shall issue a tax invoice to the Tenant in respect thereof.

(e)

Rent that is not paid to the Landlord on time shall become a liquidated debt. In respect of a liquidated debt the Tenant shall be liable to pay the Landlord interest at the maximum unauthorised overdraft rate then prevailing at the bank 0.6% per month , and a letter from that bank will constitute adequate proof as to the interest rate.

(f)

To secure payment of the rent, the Tenant shall on signing this agreement give the Landlord a non-negotiable, undated, signed cheque to the order of the Landlord in the sum of NIS 6,300, without VAT.

6.

Delivering Possession of the Premises to the Tenant

(a)

Possession of the premises shall be delivered / was delivered to the Tenant on 1st January 2009 (in this agreement referred to as “the date of delivering possession of the premises to the Tenant”).

(b)

On the date of delivering possession of the premises to the Tenant minutes shall be prepared and signed by both parties detailing the state of the premises.

7.

Absence of Non-Conformity

The Tenant hereby confirms and declares that he has seen the premises and examined them with the eyes of a tenant and he declares that he has received the premises in satisfactory and clean condition and he undertakes to return them to the Landlord in that condition and consequently he neither has nor will have any complaint of non-conformity of any type whatsoever.

8.

Additional Payments / Additional Obligations of the Tenant

(a)

The Tenant shall bear all the expenses and payments deriving from his possession of the site of the premises for which the occupier of property is liable, including rates, levies and official fees as determined from time to time by the regional council and every other payment required by the regional council and/or the Administration and/or any other entity in connection with the conduct of the business on the premises.

(b)

The Tenant may fit an appropriate direction sign in respect of his business on the premises. The position, size and contents of such sign shall be coordinated in advance with the Landlord and in the event that it is necessary to pay sign charges in accordance with the requirement of the local authority (sign tax), the Tenant shall bear the payment thereof.

(c)

The premises will be used all days of the week.

(d)

The Tenant shall, at his own expense, arrange for the cleaning of the premises and their surroundings and for the removal of packages from the yard.

(e)

It is expressed that those working on the premises during the term of the tenancy shall be solely the Tenant’s employees and that there is no labour relationship between the Tenant and/or his employees and the Kibbutz.

In the event that the Kibbutz is nevertheless made liable for any payment deriving from a determination with regard to the existence of a labour relationship between them and the Kibbutz, the Tenant undertakes to indemnity it for any such payment immediately on demand.

(f)

The Tenant shall avoid the creation of any nuisance and/or disturbance to the Kibbutz, its members, its way of life and business and in that connection he shall refrain from unreasonable noise, the creation of environmental hazards, and he shall keep the premises and their surroundings clean and bear the expenses of removing the waste caused due to the operation of his business.

9.

Non-Transfer of Rights

(a)

The Tenant may in no event transfer his rights pursuant to this agreement or any of them or the use or possession of the premises or any part of them, either for or without consideration, for any part whatsoever of the term of the tenancy, unless the Landlord’s prior written, express consent is given thereto. For the avoidance of doubt, it is expressed that the Kibbutz shall, in its discretion, not be liable to give its consent thereto.

(b)

The Tenant may not charge and/or pledge to any person or entity his rights in the premises or his contractual rights under this agreement without obtaining the Landlord’s prior written, express consent thereto. For the avoidance of doubt, it is expressed that the Kibbutz shall, in its discretion, not be liable to grant its consent thereto.

(c)

The Landlord may transfer its rights in the premises without needing the Tenant’s consent, subject to the Tenant’s rights pursuant to this agreement being preserved.

10.

Changes Not to be Made to the Premises

(a)

The Tenant hereby undertakes not to do to or on the premises and/or their fittings and/or the site of the premises any building and/or demolition work whatsoever, including internal changes, without obtaining the Landlord’s prior written, express consent thereto. For the avoidance of doubt, it is expressed that the Landlord shall not be liable to grant its consent thereto.

In the event that the Landlord does grant its consent, it may, in its discretion, make it subject to conditions (for example the production of a detailed, approved plan), including the payment.

In any event, for the avoidance of doubt it is expressed that everything involved in such building / demolition works as aforesaid shall be done at the Tenant’s expense and risk, including everything involved in obtaining permits in accordance with the law.

(b)

Any such modification and/or building work as aforesaid shall remain the sole property of the Landlord, without the Tenant being able to require any payment from the Landlord in respect thereof and/or make any assertion as to the betterment of the premises. The Tenant may at no time _______ and/or demolish what he has built or altered but on vacation the Landl