Administrative Petition (Tel Aviv) 45578-01-26 Next Gen Biomed Ltd. v. Tel Aviv Securities Authority

An urgent request was filed this evening, January 15, 2026, for an ex parte temporary injunction and an interim injunction.  It calls for a delay in the execution of the Respondent's decision (hereinafter: the Authority) from yesterday, January 14, 2026, in which it was determined that the Petitioner is a "shell company", as this term is defined in Part IV of the TASE Regulations, and that it be placed on the "Conservation List".  The decision, the Petitioner depicts, is expected to take effect tomorrow morning, January 16, 2026, and hence the urgency of the application.  Dina is rejected.

1. In a real summary, in the timeline: the Petitioner is a public company whose shares are listed for trading on the Tel Aviv Stock Exchange. Its main activity, according to it, is through a company under its control, Senate Medical Technologies in tax appeals (hereinafter: Centec).
2. The TASE Regulations, which deal with various reasons for the transfer of a company's shares to the Reserve List, which is limited in the scope of trading, include, inter alia, a case of a notice by the company or the Authority (by virtue of the amendment of the Articles of Association from 2018) regarding its transformation into a "shell company". By the relevant definition, this refers to"A company that does not have, directly or indirectly, real business activity, which yields or is expected to yield coverage in the ordinary course of business that are not only financing income", an alternative defined as the "Activity Alternative" )Section 1(d) of the TASE Guidelines for Part IV of the Articles of Association).  The Authority has the authority to Section 36(e) and36(f)(1) to the Securities Law, 5728-1968, to examine and even give its opinion on the question of whether a company has reached the level of being a "shell company", as defined in the TASE Regulations.  When the Authority announced that in its position the Applicant is a shell company, in accordance with the provision of section 8(g) To the fourth part of the bylaws, The TASE CEO is obligated to transfer the shares to the preservation list (See: Judgment in an Administrative Petition (Economic-Tel Aviv) 55852-05-25Retail Minds Technologies in a Tax Appeal v. Israel Securities Authority (27.7.2025)).

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3. Here, the authority made use of its aforesaid authority. Its announcement of January 14, 2026 was preceded by an examination and correspondence spread over a full year (Appendix B to the petition): already on January 13, 2025, the ISA announced its request to examine the company's compliance with the definition of a "shell company", and a large number of letters were exchanged between the parties, particularly at the beginning of 2025 and towards the end of 2025, with an examination showing that not all of them found their way to the petition (which the Petitioner will be asked to amend as soon as possible).  In these cases, the Authority expressed its position that this is a company that is devoid of activity; The Petitioner denied.
4. The Authority's announcement of January 14, 2026 states that the "activity alternative" exists in the Petitioner. In its detailed letter, the Authority reviews developments that have occurred since its letter of November 13, 2025, at the time of writing, the Petitioner has not yet published its reports for the first half of 2025 (a problematic matter in itself, which was kept under wraps in the petition).  On January 1, 2026, the reports were published, in which the company consolidated its reports with those of Suntec, despite the previous position of the Authority's staff on the matter.  A supplementary report was published on January 13, 2026, a day before the ISA's letter, and was also requested by the ISA in its notice.  The ISA points to various indicators of the lack of real business activity in the company: the scope of the company's tangible assets; employing only three people; the company's financial situation and uncertainty regarding the success of its development processes; negligible activity that remains and the lack of a reasonable expectation of future revenues; an explicit statement by the auditor in the financial statements regarding the significant doubts of the company's continued existence as a going concern; The use value of a Santech activity assessed with assistance is estimated to be negligible to zero.  To these, inter alia, was added a reference by the ISA regarding reports submitted by the company regarding possible engagements with other companies, from September 2025 and January 2026: these have no weight, it was determined, and even the late report of January 7, 2026 refers to a non-binding letter of intent from November 2025, to which the company's own valuation assessor did not attribute any weight.  Thus, the ISA has determined, no later than the date of the late publication of the reports, January 1, 2026, that the company has an alternative of activity.  Therefore, the company was required to announce its transformation into a shell company and to publish a report on the matter no later than January 16, 2026 at 09:30.

The Ottoman Settlement [Old Version] 19165.     Hence the petition, in which the petitioner appeals the Authority's decision.  Summary of its argument: a decision based on reports for June 30, 2025 and an examination of accounting impairment, when at the time the decision was made, these data did not reflect the company's situation.  The Authority has allegedly ignored later developments, particularly in the past two weeks, namely the report dated January 7, 2026, regarding the signing of a memorandum of intent (LOI) for a merger or strategic transaction with a company traded on NASDAQ at a value of $16.6 million, as well as obtaining approval for a European patent (EPO) to the Petitioner's core technology, on January 12, 2026.  This decision, according to the petition, is administratively unreasonable, relies on past infrastructure and ignores current evidence, and is flawed in the way of exercising the discretion of the authority that ignores the "overall picture".  The decision was also flawed, it was argued, in the manner in which it related to financial statements and valuation, and in the failure to give weight to the letter of intent.