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references to “BioLineRx,” the “Company,” “us,” “we” and “our” refer to BioLineRx Ltd., an Israeli company, and its consolidated subsidiaries;

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references to “ordinary shares,” “our shares” and similar expressions refer to the Company’s ordinary shares, NIS 0.10 nominal (par) value per share;

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references to “ADS” or “ADSs” refer to the Company’s American Depositary Shares;

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references to “dollars,” “U.S. dollars” and “$” are to United States Dollars;

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references to “shekels” and “NIS” are to New Israeli Shekels, the Israeli currency;

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references to the “Companies Law” are to Israel’s Companies Law, 5759-1999, as amended; and references to the “SEC” are to the U.S. Securities and Exchange Commission.

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the initiation, timing, progress and results of our preclinical studies, clinical trials and other therapeutic candidate development efforts;

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our ability to advance our therapeutic candidates into clinical trials or to successfully complete our preclinical studies or clinical trials;

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our receipt of regulatory approvals for our therapeutic candidates and the timing of other regulatory filings and approvals;

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the clinical development, commercialization and market acceptance of our therapeutic candidates;

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our ability to establish and maintain corporate collaborations;

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our ability to integrate new therapeutic candidates and new personnel;

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the interpretation of the properties and characteristics of our therapeutic candidates and of the results obtained with our therapeutic candidates in preclinical studies or clinical trials;

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the implementation of our business model and strategic plans for our business and therapeutic candidates;

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the scope of protection we are able to establish and maintain for intellectual property rights covering our therapeutic candidates and our ability to operate our business without infringing the intellectual property rights of others;

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estimates of our expenses, future revenues, capital requirements and our needs for and ability to access sufficient additional financing;

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risks related to changes in healthcare laws, rules and regulations in the United States or elsewhere;

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We are a clinical-stage biopharmaceutical development company with a history of operating losses, expect to incur additional losses in the future and may never be profitable;

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We cannot assure investors that our existing cash and investment balances will be sufficient to meet our future capital requirements.

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If we or our licensees are unable to obtain U.S. and/or foreign regulatory approval for our therapeutic candidates, we will be unable to commercialize our therapeutic candidates.

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Clinical trials involve a lengthy and expensive process with an uncertain outcome, and results of earlier studies and trials may not be predictive of future trial results.

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Even if we obtain regulatory approvals, our therapeutic candidates will be subject to ongoing regulatory review and if we fail to comply with continuing U.S. and applicable foreign regulations, we could lose those approvals and our business would be seriously harmed.

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We generally depend on out-licensing arrangements for late-stage development, marketing and commercialization of our therapeutic candidates.

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If we cannot meet requirements under our in-license agreements, we could lose the rights to our therapeutic candidates, which could have a material adverse effect on our business.

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If we do not meet the requirements under our agreement with the Agalimmune selling shareholders, we could lose the rights to the therapeutic candidates in Agalimmune’s pipeline, including, but not limited to, AGI-134.

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We seek to partner with third-party collaborators with respect to the development and commercialization of motixafortide, and we may not succeed in establishing and maintaining collaborative relationships, which may significantly limit our ability to develop and commercialize our product candidates successfully, if at all.

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Our business is subject to risks arising from a widespread outbreak of an illness or any other communicable disease, or any other public health crisis, such as the COVID-19 pandemic, which has impacted and could continue to impact our business. Modifications to our therapeutic candidates, or to any other therapeutic candidates that we may develop in the future, may require new regulatory clearances or approvals or may require us or our licensees, as applicable, to recall or cease marketing these therapeutic candidates until clearances are obtained.

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If our competitors develop and market products that are more effective, safer or less expensive than our current or future therapeutic candidates, our prospects will be negatively impacted.

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We have no experience selling, marketing or distributing products and no internal capability at present to do so.

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Our business could suffer if we are unable to attract and retain key employees.

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Even if our therapeutic candidates receive regulatory approval or do not require regulatory approval, they may not become commercially viable products.

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Healthcare reforms and related reductions in pharmaceutical pricing, reimbursement and coverage by governmental authorities and third-party payors may adversely affect our business.

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If third-party payors do not adequately reimburse customers for any of our therapeutic candidates that are approved for marketing, they might not be purchased or used, and our revenues and profits will not develop or increase.

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Our business has a substantial risk of clinical trial and product liability claims. If we are unable to obtain and maintain appropriate levels of insurance, a claim could adversely affect our business.

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Significant disruptions of our information technology systems or breaches of our data security could adversely affect our business.

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Our access to most of the intellectual property associated with our therapeutic candidates results from in-license agreements with biotechnology companies and a university, the termination of which would prevent us from commercializing the associated therapeutic candidates.

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Patent protection for our products is important and uncertain.

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If we are unable to protect the confidentiality of our trade secrets or know-how, such proprietary information may be used by others to compete against us.

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Legal proceedings or third-party claims of intellectual property infringement may require us to spend substantial time and money and could prevent us from developing or commercializing products.

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We may be subject to other patent-related litigation or proceedings that could be costly to defend and uncertain in their outcome.

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The market prices of our ordinary shares and ADSs are subject to fluctuation, which could result in substantial losses by our investors.

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Future sales of our ordinary shares or ADSs could reduce the market price of our ordinary shares and ADSs.

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Raising additional capital by issuing securities may cause dilution to existing shareholders.

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We conduct our operations in Israel and therefore our results may be adversely affected by political, economic and military instability in Israel and its region.

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Due to a significant portion of our expenses and revenues being denominated in non-dollar currencies, our results of operations may be harmed by currency fluctuations.

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We have received Israeli government grants for certain research and development expenditures. The terms of these grants may require us to satisfy specified conditions in order to manufacture products and transfer technologies outside of Israel. We may be required to pay penalties in addition to repayment of the grants.

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Provisions of Israeli law may delay, prevent or otherwise impede a merger with, or an acquisition of, our company, which could prevent a change of control, even when the terms of such a transaction are favorable to us and our shareholders.

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It may be difficult to enforce a U.S. judgment against us and our officers and directors in Israel or the United States, or to serve process on our officers and directors.

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Your rights and responsibilities as a shareholder will be governed by Israeli law, which may differ in some respects from the rights and responsibilities of shareholders of U.S. companies.

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a therapeutic candidate or medical device may not prove safe or efficacious;

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the results with respect to any therapeutic candidate may not confirm the positive results from earlier preclinical studies or clinical trials;

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the results may not meet the level of statistical significance required by the U.S. Food and Drug Administration, or FDA, or other regulatory authorities; and

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the results will justify only limited and/or restrictive uses, including the inclusion of warnings and contraindications, which could significantly limit the marketability and profitability of the therapeutic candidate.

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delays in securing clinical investigators or trial sites for the clinical trials;

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delays in obtaining institutional review board and other regulatory approvals to commence a clinical trial;

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slower-than-anticipated patient recruitment and enrollment;

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negative or inconclusive results from clinical trials;

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unforeseen safety issues;

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uncertain dosing issues;

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an inability to monitor patients adequately during or after treatment; and

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problems with investigator or patient compliance with the trial protocols.

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restrictions on such product, manufacturer or manufacturing process;

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warning letters from the FDA or other regulatory authorities;

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withdrawal of the product from the market;

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suspension or withdrawal of regulatory approvals;

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refusal to approve pending applications or supplements to approved applications that we or our licensees submit;

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voluntary or mandatory recall;

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fines;

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refusal to permit the import or export of our products;

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product seizure or detentions;

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injunctions or the imposition of civil or criminal penalties; or

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adverse publicity.

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we have limited control over the amount and timing of resources that our licensees devote to our therapeutic candidates;

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our licensees may experience financial difficulties;

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our licensees may fail to secure adequate commercial supplies of our therapeutic candidates upon marketing approval, if at all;

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our future revenues depend heavily on the efforts of our licensees;

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business combinations or significant changes in a licensee’s business strategy may adversely affect the licensee’s willingness or ability to complete its obligations under any arrangement with us;

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a licensee could move forward with a competing therapeutic candidate developed either independently or in collaboration with others, including our competitors; and

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out-licensing arrangements are often terminated or allowed to expire, which would delay the development and may increase the development costs of our therapeutic candidates.

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a collaboration partner may shift its priorities and resources away from our therapeutic candidates due to a change in business strategies, or a merger, acquisition, sale or downsizing;

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a collaboration partner may seek to renegotiate or terminate their relationships with us due to unsatisfactory clinical results, manufacturing issues, a change in business strategy, a change of control or other reasons;

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a collaboration partner may cease development in therapeutic areas which are the subject of our strategic collaboration;

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a collaboration partner may not devote sufficient capital or resources towards our therapeutic candidates;

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a collaboration partner may change the success criteria for a therapeutic candidate thereby delaying or ceasing development of such candidate;

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a significant delay in initiation of certain development activities by a collaboration partner will also delay payment of milestones tied to such activities, thereby impacting our ability to fund our own activities;

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a collaboration partner could develop a product that competes, either directly or indirectly, with our therapeutic candidate;

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a collaboration partner with commercialization obligations may not commit sufficient financial or human resources to the marketing, distribution or sale of a product;

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a collaboration partner with manufacturing responsibilities may encounter regulatory, resource or quality issues and be unable to meet demand requirements;

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a partner may exercise a contractual right to terminate a strategic alliance;

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a dispute may arise between us and a partner concerning the research, development or commercialization of a therapeutic candidate resulting in a delay in milestones, royalty payments or termination of an alliance and possibly resulting in costly litigation or arbitration which may divert management attention and resources; and

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a partner may use our products or technology in such a way as to invite litigation from a third party.

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our inability to recruit and retain adequate numbers of effective sales and marketing personnel;

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the inability of sales personnel to obtain access to or persuade adequate numbers of physicians to prescribe our therapeutic candidates;

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the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies with more extensive product lines; and

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unforeseen costs and expenses associated with creating and sustaining an independent sales and marketing organization.

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reliance on the third party for regulatory compliance and quality assurance;

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limitations on supply availability resulting from capacity and scheduling constraints of the third parties;

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impact on our reputation in the marketplace if manufacturers of our products, once commercialized, fail to meet customer demands;

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the possible breach of the manufacturing agreement by the third party because of factors beyond our control; and

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the possible termination or nonrenewal of the agreement by the third party, based on its own business priorities, at a time that is costly or inconvenient for us.

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difficulty in large-scale manufacturing;

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low market acceptance by physicians, healthcare payors, patients and the medical community as a result of lower demonstrated clinical safety or efficacy compared to other products, prevalence and severity of adverse side effects, or other potential disadvantages relative to alternative treatment methods;

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insufficient or unfavorable levels of reimbursement from government or third-party payors;

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infringement on proprietary rights of others for which we or our licensees have not received licenses;

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incompatibility with other therapeutic products;

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other potential advantages of alternative treatment methods;

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ineffective marketing and distribution support;

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significant changes in pricing due to pressure from public opinion, non-governmental organizations or governmental authorities;

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lack of cost-effectiveness; or

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timing of market introduction of competitive products.

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a covered benefit under its health plan;

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safe, effective and medically necessary;

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appropriate for the specific patient;

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cost-effective; and

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neither experimental nor investigational.

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announcements of technological innovations or new products by us or others;

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announcements by us of significant acquisitions, strategic partnerships, in-licensing, out-licensing, joint ventures or capital commitments;

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expiration or terminations of licenses, research contracts or other collaboration agreements;

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public concern as to the safety of drugs we, our licensees or others develop;

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general market conditions;

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the volatility of market prices for shares of biotechnology companies generally;

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success of research and development projects;

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departure of key personnel;

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developments concerning intellectual property rights or regulatory approvals;

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variations in our and our competitors’ results of operations;

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changes in earnings estimates or recommendations by securities analysts, if our ordinary shares or ADSs are covered by analysts;

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statements about the Company made in the financial media or by bloggers on the Internet;

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statements made about drug pricing and other industry-related issues by government officials;

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changes in government regulations or patent decisions;

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developments by our licensees; and

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general market conditions and other factors, including factors unrelated to our operating performance.

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the failure to obtain regulatory approval or achieve commercial success of our therapeutic candidates;

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our success in effecting out-licensing arrangements with third parties;

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our success in establishing other out-licensing or co-development arrangements;

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the success of our licensees in selling products that utilize our technologies;

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the results of our preclinical studies and clinical trials for our earlier stage therapeutic candidates, and any decisions to initiate clinical trials if supported by the preclinical results;

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the costs, timing and outcome of regulatory review of our therapeutic candidates that progress to clinical trials;

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the costs of establishing or acquiring specialty sales, marketing and distribution capabilities, if any of our therapeutic candidates are approved, and we decide to commercialize them ourselves;

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the costs of preparing, filing and prosecuting patent applications, maintaining and enforcing our issued patents and defending intellectual property-related claims;

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the extent to which we acquire or invest in businesses, products or technologies and other strategic relationships; and

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the costs of financing unanticipated working capital requirements and responding to competitive pressures.

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Revenue sharing payments. These are payments to be made to licensors with respect to revenue we receive from sub-licensing to third parties for further development and commercialization of our drug products. These payments are generally fixed at a percentage of the total revenues we earn from these sublicenses.

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Milestone payments. These payments are generally linked to the successful achievement of milestones in the development and approval of drugs, such Phases 1, 2 and 3 of clinical trials and approvals of NDAs.

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Royalty payments. To the extent we elect to complete the development, licensing and marketing of a therapeutic candidate, we are generally required to pay our licensors royalties on the sales of the end drug product. These royalty payments are generally based on the net revenue from these sales. In certain instances, the rate of the royalty payments decreases upon the expiration of the drug’s underlying patent and its transition into a generic drug. Certain of our agreements provide that if a licensed drug product is developed and sold through a different corporate entity, the licensors may elect to receive shares in such company instead of a portion of the royalties.

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Additional payments. In addition to the above payments, certain of our in-license agreements provide for a one-time or periodic payment that is not linked to milestones. Periodic payments may be paid until the commercialization of the product, either by direct sales or sublicenses to third parties. Other agreements provide for the continuation of these payments even following the commercialization of the licensed drug product.

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The motixafortide drug product candidate is covered as a composition of matter by a pending international patent application. Corresponding patents, if granted, will expire in December 2041, not including any applicable patent term extension, which may add an additional term of up to five years on the patent. We also have an exclusive license to a patent family that covers the active ingredient molecule per se. Patents of this family have been granted in the U.S., Europe, Japan and Canada. The patents will expire in August 2023, not including any applicable patent term extension. We have an exclusive license to a patent family that covers motixafortide combined with a PD1 antagonist for the treatment of cancer. A patent of this family has been granted in the U.S., and member patent applications are pending in Europe, Japan, China, Canada, Australia, India, Korea, Mexico, Brazil and Israel. The granted U.S. patent and patents to issue in the future based on pending patent applications in this family will expire in 2036, not including any applicable patent term extension. In addition, we have an exclusive license to nineteen other patent families pending or granted worldwide directed to methods of synthesis of motixafortide and methods of use of motixafortide either alone or in combination with other drugs for the treatment of certain types of cancer and other indications. Furthermore, we have Orphan Drug status for AML, pancreatic cancer and stem cell mobilization, as well as data exclusivity protection afforded to motixafortide as an NCE.

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With respect to AGI-134, Agalimmune owns or has an exclusive license to three patent families that cover the AGI-134 compound and its use for treating cancer. The use of AGI-134 for treating solid tumors is covered by patents granted in the U.S., Europe, China, Japan and other countries.  The patents will expire in 2035, not including any applicable patent term extensions.  The compound AGI-134 is covered by patents granted in the United States, Europe, Japan and other countries.  The patents will expire in 2025, not including any applicable patent term extensions. In addition, the future drug product is eligible for obtaining regulatory Biological Product exclusivity (12 years of market exclusivity in the U.S.).

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With respect to BL-5010, we have an exclusive license to a patent family directed to a novel applicator uniquely configured for applying the BL-5010 composition to targeted skin tissue safely and effectively. Patents in this family have been granted in the U.S., Europe, Israel, Japan and China. The patents will expire in 2034.

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preclinical laboratory tests, animal studies and formulation development;

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submission to the FDA of an Investigational New Drug, or IND, application to conduct human clinical testing;

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adequate and well controlled clinical trials to determine the safety and efficacy of the drug for each indication as well as to establish the exposure levels;

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submission to the FDA of an application for marketing approval;

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satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the drug is manufactured; and

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FDA review and approval of the drug and drug labeling for marketing.

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Consistent rules for conducting clinical trials throughout the EU;

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Making information on the authorization, conduct and results of each clinical trial carried out in the EU publicly available;

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Harmonized electronic submission and assessment process for clinical trials conducted in multiple member states;

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Improved collaboration, information sharing and decision-making between and within member states;

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Increased transparency of information on clinical trials; and

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Higher standards of safety for all participants in EU clinical trials.

Project	Status		Expected Near Term Milestones
motixafortide	1.	Phase 3 registration study in autologous stem cell mobilization (GENESIS) completed; top-line results announced May 2021 showed highly statistically significant evidence across all primary and secondary endpoints favoring motixafortide in combination with G-CSF (p<0.0001). In addition, the combination was found to be safe and well tolerated. Pharmaco-economic studies showed positive results regarding the cost-effectiveness of using motixafortide versus both G-CSF alone and plerixafor in combination with G-CSF. Pre-NDA meeting with FDA in December 2021 resulted in FDA agreeing that our GENESIS study is sufficient to support an NDA submission.	1.	NDA submission in mid-2022
	2.	Phase 2a study in pancreatic cancer (COMBAT/KEYNOTE-202) completed; full results showing improvement in all endpoints announced December 2020	2.	Evaluation and planning of next clinical development steps, including discussions towards potential collaborations and development of a protocol for a randomized controlled study
	3.	Phase 2 investigator-initiated study in first-line PDAC patients	3.	Data from the study is anticipated in mid-2022*
	4.	Phase 1b study in patients with ARDS secondary to COVID-19 and other respiratory viral infections	4.	Results of the preliminary analysis are expected in 2022*
AGI-134	Phase 1/2a study, ongoing		Initial proof-of-mechanism of action and efficacy results expected in second half of 2022

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the number of sites included in the clinical trials;

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the length of time required to enroll suitable patients;

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the number of patients that participate in the clinical trials;

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the duration of patient follow-up;

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whether the patients require hospitalization or can be treated on an out-patient basis;

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the development stage of the therapeutic candidate; and

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the efficacy and safety profile of the therapeutic candidate.

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identify the contract with a customer;

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identify the performance obligations in the contract;

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determine the transaction price;

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allocate the transaction price to the performance obligations in the contract; and

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recognize revenue when (or as) the entity satisfies a performance obligation.

		Three Months Ended
		March 31				June 30				Sept. 30				Dec. 31				March 31				June 30				Sept. 30				Dec. 31
		2020																2021
		(in thousands of U.S. dollars)
Consolidated Statements of Operations
Revenues			–				–				–				–				–				–				–				–
Cost of revenues			–				–				–				–				–				–				–				–
Research and development expenses			(5,422	)			(4,640	)			(3,484	)			(4,627	)			(4,278	)			(5,139	)			(4,923	)			(5,126	)
Sales and marketing expenses			(175	)			(182	)			(309	)			(174	)			(154	)			(330	)			(247	)			(272	)
General and administrative expenses			(1,243	)			(744	)			(856	)			(1,071	)			(1,017	)			(1,044	)			(1,047	)			(1,200	)
Operating loss			(6,840	)			(5,566	)			(4,649	)			(5,872	)			(5,449	)			(6,513	)			(6,217	)			(6,598	)
Non-operating income (expenses), net			469				(843	)			294				(5,621	)			(4,561	)			(217	)			710				2,238
Financial income			140				35				39				22				117				130				52				260
Financial expenses			(414	)			(396	)			(302	)			(517	)			(299	)			(242	)			(261	)			(204	)
Net loss			(6,645	)			(6,770	)			(4,618	)			(11,988	)			(10,192	)			(6,842	)			(5,716	)			(4,304	)

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the progress and costs of our preclinical studies, clinical trials and other research and development activities;

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the scope, prioritization and number of our clinical trials and other research and development programs;

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the amount of revenues we receive under our collaboration or licensing arrangements;

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the costs of the development and expansion of our operational and commercial infrastructure;

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the costs and timing of obtaining regulatory approval of our therapeutic candidates;

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the ability of our collaborators to achieve development milestones, marketing approval and other events or developments under our collaboration agreements;

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the costs of filing, prosecuting, enforcing and defending patent claims and other intellectual property rights;

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the costs and timing of securing manufacturing arrangements for clinical or commercial production;

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the costs of establishing sales and marketing capabilities or contracting with third parties to provide these capabilities for us;

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the costs of acquiring or undertaking development and commercialization efforts for any future product candidates;

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the magnitude of our general and administrative expenses;

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any cost that we may incur under current and future licensing arrangements relating to our therapeutic candidates;

Name		Age		Position(s)
Philip A. Serlin, CPA, MBA		61		Chief Executive Officer
Mali Zeevi, CPA		46		Chief Financial Officer
Ella Sorani, Ph.D.		54		Chief Development Officer
Abi Vainstein-Haras, M.D.		47		Chief Medical Officer
Aharon Schwartz, Ph.D. (1)		79		Chairman of the Board
Michael J. Anghel, Ph.D. (1)(4)		83		Director
Nurit Benjamini, MBA (1)(2)(3)(4)		55		External Director
B.J. Bormann, Ph.D. (1)		63		Director
Raphael Hofstein, Ph.D. (1)(2)(3)		72		Director
Avraham Molcho, M.D. (1)(2)(3)		64		External Director
Sandra Panem, Ph.D. (1)		75		Director

(1)

Independent director under applicable Nasdaq Capital Market and SEC rules, as affirmatively determined by our Board.

(2)

A member of our audit committee.

(3)

A member of our compensation committee.

(4)

A member of our investment monitoring committee.

		Salaries, fees, commissions and bonuses				Pension, retirement, options and other similar benefits
		(in thousands of U.S. dollars)
All directors and senior management as a group, consisting of 11 persons			1,735				867

(1)

“Social Benefits” include payments to the National Insurance Institute, advanced education funds, managers’ insurance and pension funds, vacation pay and recuperation pay as mandated by Israeli law.

(2)

Consists of amounts recognized as share-based compensation expense on the Company’s statement of comprehensive loss for the year ended December 31, 2021.

(3)

“All Other Compensation” includes automobile-related expenses pursuant to the Company’s automobile leasing program, telephone, basic health insurance and holiday presents.

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the majority of the shares that are voted at the meeting, including at least a majority of the shares held by non-controlling shareholders or shareholders who do not have a personal interest in the election of the external director (other than a personal interest not deriving from a relationship with a controlling shareholder) who voted at the meeting, excluding abstentions, vote in favor of the election of the external director; or

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the total number of shares held by non-controlling, disinterested shareholders (as described in the preceding bullet point) that are voted against the election of the external director does not exceed 2% of the aggregate voting rights in the company.

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an employment relationship;

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a business or professional relationship even if not maintained on a regular basis (excluding insignificant relationships);

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control; and

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service as an office holder, excluding service as a director in a private company prior to the first offering of its shares to the public if such director was appointed as a director of the private company in order to serve as an external director following the public offering.

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the chairman of the company’s board of directors;

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a controlling shareholder or a relative of a controlling shareholder of the company (as each such term is defined in the Companies Law); or

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any director employed by the company, by a controlling shareholder of the company or by any other entity controlled by a controlling shareholder of the company, or any director who provides services to the company, to a controlling shareholder of the company or to any other entity controlled by a controlling shareholder of the company on a regular basis (other than as a member of the board of directors), or any other director whose main source of income derives from a controlling shareholder of the company.

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he or she meets the qualifications for being appointed as an external director, except for (i) the requirement that the director be an Israeli resident (which does not apply to companies such as ours whose securities have been offered outside of Israel or are listed outside of Israel) and (ii) the requirement for accounting and financial expertise or professional qualifications; and

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he or she has not served as a director of the company for a period exceeding nine consecutive years. For this purpose, a break of less than two years in the service shall not be deemed to interrupt the continuation of the service.

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oversight of the company’s independent registered public accounting firm and recommending the engagement, compensation or termination of engagement of our independent registered public accounting firm to our Board of Directors in accordance with Israeli law;

•

recommending the engagement or termination of the office of our internal auditor; and

•

reviewing and pre-approving the terms of audit and non-audit services provided by our independent auditors.

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the chairman of the company’s board of directors;

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a controlling shareholder or a relative of a controlling shareholder of the company (as each such term is defined in the Companies Law); or

•

any director employed by the company, by a controlling shareholder of the company or by any other entity controlled by a controlling shareholder of the company, or any director who provides services to the company on a permanent basis, to a controlling shareholder of the company or to any other entity controlled by a controlling shareholder of the company on a regular basis (other than as a member of the board of directors), or any other director whose main source of income derives from a controlling shareholder of the company.

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to make recommendations to the board of directors as to a compensation policy for officers, as well as to recommend once every three years to extend the compensation policy, subject to receipt of the required corporate approvals;

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to make recommendations to the board of directors as to any updates to the compensation policy which may be required;

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to review the implementation of the compensation policy by the company;

•

to approve transactions relating to terms of office and employment of certain company office holders, that require the approval of the compensation committee pursuant to the Companies Law; and

•

to exempt, under certain circumstances, a transaction relating to terms of office and employment from the requirement of approval of the shareholders meeting.

(i)

the majority of the votes includes at least a majority of all the votes of shareholders who are not controlling shareholders of the company or who do not have a personal interest in the compensation policy and participating in the vote; abstentions shall not be included in the total of the votes of the aforesaid shareholders; or

(ii)

the total of opposing votes from among the shareholders described in subsection (i) above does not exceed 2% of all the voting rights in the company.

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a person (or a relative of a person) who holds more than 5% of the company’s shares;

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a person (or a relative of a person) who has the power to appoint a director or the general manager of the company;

•

an executive officer or director of the company; or

•

a member of the company’s independent accounting firm.

•

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 requires an office holder to act in good faith and for the benefit of the company, and includes the duty to:

•

refrain from any act involving a conflict of interest between the performance of his or her duties in the company and his or her other duties or personal affairs;

•

refrain from any activity that is competitive with the business of the company;

•

refrain from exploiting any business opportunity of the company for the purpose of gaining a personal advantage 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 or her position as an office holder.

•

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.

•

A transaction with an office holder in a public company that is neither a director nor the chief executive officer regarding his or her terms of office and employment requires approval by the (i) compensation committee; and (ii) the board of directors. Approval of terms of office and employment for such officers which do not comply with the compensation policy may nonetheless be approved subject to two cumulative conditions: (i) the compensation committee and thereafter the board of directors, approved the terms after having taken into account the various considerations and mandatory requirements set forth in the Companies Law with respect to office holder compensation, and (ii) the shareholders of the company have approved the terms by means of the following special majority requirements, or the Special Majority Requirements, as set forth in the Companies Law, pursuant to which the shareholder approval must either include at least one-half of the shares held by non-controlling and disinterested shareholders who actively participate in the voting process (without taking abstaining votes into account), or, alternatively, the total shareholdings of the non-controlling and disinterested shareholders who vote against the transaction must not represent more than 2% of the voting rights in the company. However, the transaction may still be approved despite shareholder rejection, provided that a company’s compensation committee and thereafter the board of directors have determined to approve the proposal, based on detailed reasoning, after having re-examined the terms of office and employment, and taken the shareholder rejection into consideration.

•

A transaction with the chief executive officer in a public company regarding his or her terms of office and employment requires approval by the (i) compensation committee; (ii) the board of directors; and (iii) the shareholders of the company by the Special Majority Requirements. Approval of terms of office and employment for the chief executive officer which do not comply with the compensation policy may nonetheless be approved subject to two cumulative conditions: (i) the compensation committee and thereafter the board of directors, approved the terms after having taken into account the various considerations and mandatory requirements set forth in the Companies Law with respect to office holder compensation and (ii) the shareholders of the company have approved the terms by means of the Special Majority Requirements, as detailed above. However, a transaction with a chief executive officer that is not approved by shareholders may still be approved despite shareholder rejection, provided that a company’s compensation committee and thereafter the board of directors have determined to approve the proposal, based on detailed reasoning, after having re-examined the terms of office and employment, and taken the shareholder rejection into consideration. In addition, the compensation committee may exempt the transaction regarding terms of office and employment with a candidate for the office of chief executive officer where such officer has no relationship with the controlling shareholder or the company from shareholder approval if it has found, based on detailed reasons, that bringing the transaction to the approval of the shareholders meeting shall prevent the employment of such candidate by the company. Such approval may be given only in respect of terms of office and employment which are in accordance with the company’s compensation policy.

•

A transaction with a director who is not  the chief executive officer of a public company regarding his or her terms of office and engagement requires approval by the (i) compensation committee; (ii) the board of directors; and (iii) the shareholders of the company. Approval of terms of office and employment for directors of a company which do not comply with the compensation policy may nonetheless be approved subject to two cumulative conditions: (i) the compensation committee and thereafter the board of directors, approved the terms after having taken into account the various considerations and mandatory requirements set forth in the Companies Law with respect to office holder compensation and (ii) the shareholders of the company have approved the terms by means of the Special Majority Requirements, as detailed above. In addition, pursuant to a relief provided under the Companies Regulations (Relief in Interested Party Transactions), 2000, the compensation committee may exempt the transaction regarding terms of office and engagement with a non-executive director, if the compensation committee and board of directors determined that such terms of office are only for the benefit of the company, or if the compensation terms of the director do not exceed the maximum compensation paid to external directors pursuant to the applicable regulations.

•

at least a majority of the shares held by shareholders who have no personal interest in the transaction and are voting at the meeting must be voted in favor of approving the transaction, excluding abstentions; or

•

the shares voted by shareholders who have no personal interest in the transaction who vote against the transaction represent no more than 2% of the voting rights in the company.

•

an amendment to the articles of association;

•

an increase in the company’s authorized share capital;

•

a merger; and

•

the approval of related party transactions and acts of office holders that require shareholder approval.

•

financial liability imposed on him or her in favor of another person pursuant to a judgment, settlement or arbitrator’s award approved by a court. However, if an undertaking to indemnify an office holder with respect to such liability is provided in advance, then such an undertaking must be limited to events which, in the opinion of the board of directors, can be foreseen based on the company’s activities when the undertaking to indemnify is given, and to an amount or according to criteria determined by the board of directors as reasonable under the circumstances, and such undertaking shall detail the abovementioned events and amount or criteria;

•

reasonable litigation expenses, including attorneys’ fees, incurred by the office holder as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, provided that (1) no indictment was filed against such office holder as a result of such investigation or proceeding; and (2) no financial liability, such as a criminal penalty, was imposed upon him or her as a substitute for the criminal proceeding as a result of such investigation or proceeding or, if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent; and

•

reasonable litigation expenses, including attorneys’ fees, incurred by the office holder or imposed by a court in proceedings instituted against him or her by the company, on its behalf or by a third party or in connection with criminal proceedings in which the office holder was acquitted or as a result of a conviction for an offense that does not require proof of criminal intent.

•

a breach of duty of loyalty to the company, to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company;

•

a breach of duty of care to the company or to a third party, including a breach arising out of the negligent (but not grossly negligent) conduct of the office holder; and

•

a financial liability imposed on the office holder in favor of a third party.

•

a breach of duty of loyalty, except to the extent that the office holder acted in good faith and had a reasonable basis to believe that the act would not prejudice the company;

•

a breach of duty of care committed intentionally or recklessly, excluding a breach arising out of the negligent conduct of the office holder;

•

an act or omission committed with intent to derive illegal personal benefit; or

•

a fine or forfeit levied against the office holder.

		December 31,
		2019				2020				2021
Management and administration			10				9				9
Research and development			30				27				27
Sales and marketing			2				2				2
Total			42				38				38

		Number of
		Ordinary Shares
		Beneficially				Percent of
		Held				Class
Directors
Aharon Schwartz(1)			2,168,333				*
Michael J. Anghel(2)			413,333				*
Nurit Benjamini(3)			403,333				*
B.J. Bormann(4)			413,333				*
Raphael Hofstein(5)			413,333				*
Avraham Molcho(6)			403,333				*
Sandra Panem(7)			413,333				*
Executive officers
Philip A. Serlin(8)			4,093,647				*
Mali Zeevi(9)			1,486,427				*
Ella Sorani(10)			1,290,302				*
Abi Vainstein-Haras(11)			1,497,502				*
All directors and executive officers as a group (11 persons)(12)			12,996,209				1.56	%

(1)

Includes 413,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(2)

Includes 413,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(3)

Includes 403,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(4)

Includes 413,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(5)

Includes 413,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(6)

Includes 403,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(7)

Includes 413,333 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 46,667 ordinary shares issuable upon exercise of outstanding options that are not exercisable within 60 days of March 15, 2022.

(8)

Includes 3,921,729 issued ordinary shares upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 4,920,107 ordinary shares issuable upon exercise of outstanding equity instruments that are not exercisable within 60 days of March 15, 2022.

(9)

Includes 1,249,310 ordinary shares issuable upon exercise of outstanding options within 60 days of March 15, 2022. Does not include 1,138,123 ordinary shares issuable upon exercise of outstanding equity instruments that are not exercisable within 60 days of March 15, 2022.

•

the excess distribution or gain would be allocated ratably over the Non-Electing U.S. Investor’s holding period for the ordinary shares or ADSs;

•

the amount allocated to the current taxable year and any year prior to us becoming a PFIC would be taxed as ordinary income; and

•

the amount allocated to each of the other taxable years would be subject to tax at the highest rate of tax in effect for the applicable class of taxpayer for that year, and an interest charge for the deemed deferral benefit would be imposed with respect to the resulting tax attributable to each such other taxable year.

•

taxes and other governmental charges;

•

any applicable transfer or registration fees;

•

certain cable, telex and facsimile transmission charges as provided in the deposit agreement;

•

any expenses incurred in the conversion of foreign currency;

•

a fee of $5.00 or less per 100 ADSs (or a portion thereof) for the execution and delivery of ADRs and the surrender of ADRs, including if the deposit agreement terminates;

•

a fee of $.05 or less per ADS (or portion thereof) for any cash distribution made pursuant to the deposit agreement;

•

a fee for the distribution of securities pursuant to the deposit agreement;

•

in addition to any fee charged for a cash distribution, a fee of $.05 or less per ADS (or portion thereof) per annum for depositary services;

•

a fee for the distribution of proceeds of rights that the Depositary sells pursuant to the deposit agreement; and

•

any other charges payable by the Depositary, any of the Depositary’s agents, or the agents of the Depositary’s agents in connection with the servicing of ordinary shares or other Deposited Securities.

a.

Disclosure Controls and Procedures

b.

Management’s Annual Report on Internal Control over Financial Reporting

c.

Attestation Report of Registered Public Accounting Firm

d.

Changes in Internal Control over Financial Reporting

		Year Ended December 31,
		2020				2021
Services Rendered		(in thousands of U.S. dollars)
Audit Fees(1)			110				130
Audit-Related Fees(2)			38				25
Tax Fees(3)			16				20
All Other Fees			-				-
Total			164				175

(1)

Audit fees consist of services that would normally be provided in connection with statutory and regulatory filings or engagements, including services that generally only the independent accountant can reasonably provide.

(2)

Audit-related services relate to reports to the IIA and work regarding a public listing or offering.

(3)

Tax fees relate to tax compliance, planning and advice.

•

Distribution of annual and quarterly reports to shareholders. Under Israeli law, as a public company whose shares are traded on the TASE, we are not required to distribute annual and quarterly reports directly to shareholders and the generally accepted business practice in Israel is not to distribute such reports to shareholders but to make such reports publicly available through the website of the ISA and the TASE. In addition, we make our audited financial statements available to our shareholders at our offices. As a foreign private issuer, we are generally exempt from the SEC’s proxy solicitation rules.

•

Quorum. While the Nasdaq Rules require that the quorum for purposes of any meeting of the holders of a listed company’s common voting stock, as specified in the company’s bylaws, be no less than 33 1/3% of the company’s outstanding common voting stock, under Israeli law, a company is entitled to determine in its articles of association the number of shareholders and percentage of holdings required for a quorum at a shareholders meeting. Our Articles of Association provide that a quorum of two or more shareholders holding at least 25% of the voting rights in person or by proxy is required for commencement of business at a general meeting. However, the quorum set forth in our Articles of Association with respect to an adjourned meeting consists of any number of shareholders present in person or by proxy.

•

Independent Directors. Our Board of Directors includes two external directors in accordance with the provisions contained in Sections 239-249 of the Companies Law and Rule 10A-3 of the general rules and regulations promulgated under the Securities Act, rather than a majority of independent directors. Israeli law does not require, nor do our independent directors conduct, regularly scheduled meetings at which only they are present. We are required, however, to ensure that all members of our Audit Committee are “independent” under the applicable Nasdaq and SEC criteria for independence (as a foreign private issuer we are not exempt from the SEC independence requirement), and we must also ensure that a majority of the members of our Audit Committee are independent directors as defined in the Companies Law. Furthermore, Israeli law does not require, nor do our independent directors conduct, regularly scheduled meetings at which only they are present, which the Nasdaq Rules otherwise require. If we qualify as an Eligible Company and opt to follow the exemption provided under the Relief Regulations regarding appointment of external directors and composition of the audit and compensation committees, we will be required at all times to comply with the U.S. rules and regulations governing the appointment of independent directors and composition of the audit and compensation committees applicable to U.S. domestic issuers instead of complying with the Companies Law provisions relating to external directors and composition of the audit and compensation committees.

•

Audit Committee. Our Audit Committee complies with all of the requirements under Israeli law, and is composed of two external directors, which are all of our external directors, and only one other director, who cannot be the chairman of our Board of Directors. Consistent with Israeli law, the independent auditors are elected at a meeting of shareholders instead of being appointed by the Audit Committee. If we qualify as an Eligible Company and opt to follow the exemption provided under the Relief Regulations regarding appointment of external directors and composition of the audit and compensation committees, we will be required at all times to comply with the U.S. rules and regulations governing the appointment of independent directors and composition of the Audit Committee applicable to U.S. domestic issuers instead of complying with the Companies Law provisions relating to external directors and composition of the Audit Committee.

•

Nomination of our Directors. With the exception of our external directors and directors elected by our Board of Directors due to vacancy, our directors are elected by a general or extraordinary meeting of our shareholders, to hold office until they are removed from office by the majority of our shareholders at a general or extraordinary meeting of our shareholders. See “Item 6. Directors, Senior Management and Employees — Board Practices — Board of Directors.” The nominations for directors, which are presented to our shareholders, are generally made by our directors, but nominations may be made by one or more of our shareholders as provided under the Companies Law or in an agreement between us and our shareholders. Currently, there is no agreement between us and any shareholder regarding the nomination of directors. In accordance with our Articles of Association, under the Companies Law, any one or more shareholders holding, in the aggregate, either (1) at least 5% of our outstanding shares and at least 1% of our outstanding voting power or (2) at least 5% of our outstanding voting power, may nominate one or more persons for election as directors at a general or special meeting by delivering a written notice of such shareholder’s intent to make such nomination or nominations to our registered office. Each such notice must set forth all of the details and information as required to be provided in the Companies Law.

•

Compensation Committee and Compensation of Officers. Israeli law, and our Articles of Association, do not require that a compensation committee composed solely of independent members of our Board of Directors determine (or recommend to the board of directors for determination) an executive officer’s compensation, as required under Nasdaq’s listing standards related to compensation committee independence and responsibilities; nor do they require that the Company adopt and file a compensation committee charter. Instead, our Compensation Committee has been established and conducts itself in accordance with provisions governing the composition of and the responsibilities of a compensation committee as set forth in the Companies Law, and is comprised of all of our external directors (who must comprise the majority of the members of the Compensation Committee), and at least one additional director who is entitled to the same compensation payable to our external directors, and who is not the chairman of our Board of Directors or otherwise employed by or a provider of services to, the Company. If we qualify as an Eligible Company and opt to follow the exemption provided under the Relief Regulations regarding appointment of external directors and composition of the audit and compensation committees, we will be required at all times to comply with the U.S. rules and regulations governing the appointment of independent directors and composition of the compensation committee applicable to U.S. domestic issuers instead of complying with the Companies Law provisions relating to external directors and composition of the compensation committee. Additionally, we comply with the requirements set forth under the Companies Law, pursuant to which transactions with office holders regarding their terms of office and employment, and a transaction with a controlling shareholder in a company regarding his or her employment and/or his or her terms of office with the company, may require the approval of the compensation committee, the board of directors and under certain circumstances the shareholders, either in accordance with our previously approved compensation policy or, in special circumstances in deviation therefrom, taking into account certain considerations set forth in the Companies Law. See “Item 6. Directors, Senior Management and Employees — Board Practices — Compensation Committee” for information regarding the Compensation Committee, and “Item 6. Directors, Senior Management and Employees — Approval of Related Party Transactions under Israeli Law” for information regarding the special approvals required with respect to approval of terms of office and employment of office holders, pursuant to the Companies Law. The requirements for shareholder approval of any office holder compensation, and the relevant majority or special majority for such approval, are all as set forth in the Companies Law. Thus, we will seek shareholder approval for all corporate actions with respect to office holder compensation requiring such approval under the requirements of the Companies Law, including seeking prior approval of the shareholders for the compensation policy and for certain office holder compensation, rather than seeking approval for such corporate actions in accordance with Nasdaq Listing Rules.

•

Approval of Related Party Transactions. All related party transactions are approved in accordance with the requirements and procedures for approval of interested party acts and transactions, set forth in sections 268 to 275 of the Companies Law, and the regulations promulgated thereunder, which require the approval of the audit committee, the compensation committee, the board of directors and shareholders, as may be applicable, for specified transactions, rather than approval by the audit committee or other independent body of our Board of Directors as required under the Nasdaq Rules.

•

Shareholder Approval. We seek shareholder approval for all corporate actions requiring such approval in accordance with the requirements of the Companies Law, which are different or in addition to the requirements for seeking shareholder approval under Nasdaq Listing Rule 5635, rather than seeking approval for corporation actions in accordance with such listing rules.

•

Equity Compensation Plans. We do not necessarily seek shareholder approval for the establishment of, and amendments to, stock option or equity compensation plans (as set forth in Nasdaq Listing Rule 5635(c)), as such matters are not subject to shareholder approval under Israeli law. Our equity compensation plan is available to our employees, none of whom are currently U.S. employees, and provides features necessary to comply with applicable non-U.S. tax laws.

(1)

Incorporated by reference to the Registrant’s Annual Report on Form 20-F filed on February 23, 2021.

(2)

Incorporated by reference to Exhibit 1 of the Registration Statement on Form F-6EF (No. 333-218969) filed by the Bank of New York Mellon on June 26, 2017 with respect to the Registrant’s American Depositary Shares.

(3)

Incorporated by reference to the Registrant’s Annual Report on Form 20-F filed on March 23, 2017.

(4)

Incorporated by reference to the Registrant’s Registration Statement on Form 20-F (No. 001-35223) filed on July 1, 2011.

(5)

Incorporated by reference to the Registrant’s Annual Report on Form 20-F filed on March 10, 2016.

(6)

Incorporated by reference to the Registrant’s Annual Report on Form 20-F/A filed on May 31, 2016.

(7)

Incorporated by reference to the Registrant’s Form 6-K filed on October 3, 2018.

(8)

Incorporated by reference to the Registrant’s Annual Report on Form 20-F filed on March 12, 2020.

(9)

Incorporated by reference to the Registrant’s Annual Report on Form 20-F filed on March 23, 2015.

	BIOLINERX LTD.
	By:	/s/ Philip A. Serlin
		Philip A. Serlin
		Chief Executive Officer