[FORM OF ORIGINAL ISSUE DISCOUNT 


SENIOR SECURED CONVERTIBLE NOTE]


 


NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE
TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144
OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES. ANY TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE
TERMS OF THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 19(a) HEREOF. THE PRINCIPAL AMOUNT REPRESENTED BY THIS NOTE AND, ACCORDINGLY,
THE SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii)
OF THIS NOTE.


 


morria
biopharmaceuticals plc


 


Original
Issue Discount Senior Secured Convertible Note


 


	Issuance Date:  March __, 2012	Original Principal Amount: U.S. $_________1


 


FOR VALUE RECEIVED,
Morria Biopharmaceuticals PLC, a public limited company formed under the laws of England and Wales (the “Company”),
hereby promises to pay to the order of ____________ or its registered assigns (“Holder”) the amount set out
above as the Original Principal Amount (as reduced pursuant to the terms hereof pursuant to redemption, conversion or otherwise,
the “Principal”) when due, whether upon the Maturity Date, or upon acceleration, redemption or otherwise (in
each case in accordance with the terms hereof), and to pay interest (“Interest”) on any outstanding Principal
(as defined below) at the applicable Interest Rate (as defined below) from the date set out above as the Issuance Date (the “Issuance
Date”) until the same becomes due and payable, whether upon the Maturity Date or acceleration, conversion, redemption
or otherwise (in each case in accordance with the terms hereof). This Original Issue Discount Senior Secured Convertible Note (including
all Original Issue Discount Senior Secured Convertible Notes issued in exchange, transfer or replacement hereof, this “Note”)
is one of an issue of Original Issue Discount Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement
(as defined below) on the Closing Date (as defined below) (collectively, the “Notes,” and such other Original
Issue Discount Senior Secured Convertible Notes, if any, the “Other Notes”). Certain capitalized terms
used herein are defined in Section 29.


 







1 Aggregate principal
amount of all notes to be $1,100,000


 



    	 



    	 



    

 


1.          PAYMENTS
OF PRINCIPAL. On the Maturity Date, the Company shall pay to the Holder an amount equal to the Principal. Other than as specifically
permitted by this Note, the Company may not prepay any portion of the outstanding Principal, accrued and unpaid Interest or accrued
and unpaid Late Charges on Principal and Interest, if any.


 


2.          INTEREST;
INTEREST RATE. No Interest shall accrue on this Note prior to the occurrence of an Event of Default, in which case Interest
on this Note shall commence accruing on the occurrence of such Event of Default, shall accrue daily at the Interest Rate on the
outstanding Principal amount from time to time, shall be computed on the basis of a 360-day year comprised of twelve (12) thirty
(30) day months, shall compound each Quarter and shall be payable in accordance with the terms of this Note. From and after the
occurrence and during the continuance of any Event of Default, the Interest Rate shall automatically be increased to eighteen percent
(18%). In the event that such Event of Default is subsequently cured, the increase referred to in the preceding sentence shall
cease to be effective as of the date of such cure, provided that any Interest that is accrued and unpaid at such increased rate
during the continuance of such Event of Default shall continue to be outstanding and payable to the extent such Interest represents
accrued and unpaid interest in respect of period commencing on the date on which such Event of Default occurs through and including
the date on which such Event of Default is cured.


 


3.          CONVERSION
OF NOTES. This Note shall be convertible into validly issued, fully paid and non-assessable Ordinary Shares (as defined below),
on the terms and conditions set forth in this Section 3.


 


(a)          Conversion
Right. Subject to the provisions of Section 3(d), at any time or times on or after the Issuance Date, the Holder shall be entitled
to convert any portion of the outstanding and unpaid Conversion Amount (as defined below) into validly issued, fully paid and non-assessable
Ordinary Shares in accordance with Section 3(c), at the Conversion Rate (as defined below). The Company shall not issue any fraction
of an Ordinary Share upon any conversion. If the issuance would result in the issuance of a fraction of an Ordinary Share, the
Company shall round such fraction of an Ordinary Share up to the nearest whole share. The Company shall pay any and all transfer,
stamp, issuance and similar taxes that may be payable with respect to the issuance and delivery of Ordinary Shares upon conversion
of any Conversion Amount.


 


(b)          Conversion
Rate. The number of Ordinary Shares issuable upon conversion of any Conversion Amount pursuant to Section 3(a) shall be determined
by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion Rate”).


 



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(i)          “Conversion
Amount” means the portion of the Principal to be converted, redeemed or otherwise with respect to which this determination
is being made, plus all accrued and unpaid Interest with respect to such portion of the Principal amount
and accrued and unpaid Late Charges with respect to such portion of such Principal and such Interest.


 


(ii)          “Conversion
Price” means, as of any Conversion Date or other date of determination, $____2, subject to adjustment as provided
herein.


 


(c)          Mechanics
of Conversion.


 


(i)          Optional
Conversion. To convert any Conversion Amount into Ordinary Shares on any date (a “Conversion Date”), the
Holder shall deliver (whether via facsimile or otherwise), for receipt on or prior to 5:30 p.m., New York time, on any Trading
Day, a copy of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion Notice”)
to the Company. A Conversion Notice delivered after such time or on a non-Trading Day shall be deemed to have been delivered on
the following Trading Day.  If required by Section 3(c)(iii), within three (3) Trading Days following a conversion of
this Note as aforesaid, the Holder shall surrender this Note to a nationally recognized overnight delivery service for delivery
to the Company (or an indemnification undertaking with respect to this Note in the case of its loss, theft or destruction as contemplated
by Section 19(b)). On or before the first (1st) Trading Day following the date of receipt of a Conversion Notice (whether
via facsimile or otherwise), the Company shall transmit by facsimile an acknowledgment of confirmation, in the form attached hereto
as Exhibit II, of receipt of such Conversion Notice to the Holder and the Company’s transfer agent (which, for the
avoidance of doubt, may be the Company prior to the Self Filing Effective Date (as defined in the Securities Purchase Agreement))
(the “Transfer Agent”) and shall promptly instruct and otherwise use its reasonable best efforts to cause the
Transfer Agent to complete the following actions on or before the third (3rd) Trading Day following the date of receipt of a Conversion
Notice (whether via facsimile or otherwise): (1) provided that the Transfer Agent is participating in The Depository Trust Company’s
(“DTC”) Fast Automated Securities Transfer Program, credit such aggregate number of Ordinary Shares to which
the Holder shall be entitled to the Holder’s or its designee’s balance account with DTC through its Deposit/Withdrawal
at Custodian system or (2) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue
and deliver (via reputable overnight courier) to the address as specified in the Conversion Notice, a certificate, registered in
the name of the Holder or its designee, for the number of Ordinary Shares to which the Holder shall be entitled. If this Note is
physically surrendered for conversion pursuant to Section 3(c)(iii) and the outstanding Principal of this Note is greater than
the Principal portion of the Conversion Amount being converted, then the Company shall as soon as practicable and in no event later
than three (3) Business Days after receipt of this Note and at its own expense, issue and deliver to the Holder (or its designee)
a new Note (in accordance with Section 19(d)) representing the outstanding Principal not converted. The Person or Persons entitled
to receive the Ordinary Shares issuable upon a conversion of this Note shall be treated for all purposes as the record holder or
holders of such Ordinary Shares on the Conversion Date.


 







2 Based on a pre-money
valuation of $24 million



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(ii)          Company’s
Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, on the first (1st) Trading
Day immediately following the Company’s receipt of a Conversion Notice (whether via facsimile or otherwise) from a Holder,
to give notice to and instruct, and otherwise use the Company’s reasonable best efforts to cause, the Transfer Agent to thereafter
promptly issue to such Holder a certificate for the number of Ordinary Shares to which the Holder is entitled and register such
Ordinary Shares on the Company’s share register or to credit the Holder’s or its designee’s balance account with
DTC for such number of Ordinary Shares to which the Holder is entitled upon the Holder’s conversion of any Conversion Amount
(as the case may be) (a “Conversion Failure”), then, in addition to all other remedies available to the Holder,
the Holder may declare the Company to be in breach under this Note. Furthermore, (1) the Company shall pay in cash to the Holder
on each Trading Day after such third (3rd) Trading Day that the issuance of such Ordinary Shares is not timely effected
an amount equal to 1% of the product of (A) the sum of the number of Ordinary Shares not issued to the Holder on a timely basis
and to which the Holder is entitled multiplied by (B) the Closing Sale Price of Ordinary Shares on the Trading Day immediately
preceding the last possible date which the Company could have issued such Ordinary Shares to the Holder without violating Section
3(c)(i) and (2) the Holder, upon written notice to the Company, may void its Conversion Notice with respect to, and retain or have
returned (as the case may be) any portion of this Note that has not been converted pursuant to such Conversion Notice, provided
that the voiding of a Conversion Notice shall not affect the Company’s obligations to make any payments which have accrued
prior to the date of such notice pursuant to this Section 3(c)(ii) or otherwise. In addition to the foregoing, if within three
(3) Trading Days after the Company’s receipt of a Conversion Notice (whether via facsimile or otherwise), the Company shall
fail to issue and deliver a certificate to the Holder and register such Ordinary Shares on the Company’s share register or
credit the Holder’s or its designee’s balance account with DTC for the number of Ordinary Shares to which the Holder
is entitled upon the Holder’s conversion hereunder (as the case may be), and if on or after such third (3rd) Trading
Day the Holder (or any other Person in respect, or on behalf, of the Holder) purchases (in an open market transaction or otherwise)
Ordinary Shares to deliver in satisfaction of a sale by the Holder of all or any portion of the number of Ordinary Shares, or a
sale of a number of Ordinary Shares equal to all or any portion of the number of Ordinary Shares, issuable upon such conversion
that the Holder so anticipated receiving from the Company, then, in addition to all other remedies available to the Holder, the
Company shall, within three (3) Business Days after the Holder’s request and in the Holder’s discretion, either (i)
pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions and other
out-of-pocket expenses, if any) for the Ordinary Shares so purchased (including, without limitation, by any other Person in respect,
or on behalf, of the Holder) (the “Buy-In Price”), at which point the Company’s obligation to so issue
and deliver such certificate or credit the Holder’s balance account with DTC for the number of Ordinary Shares to which the
Holder is entitled upon the Holder’s conversion hereunder (as the case may be) (and to issue such Ordinary Shares) shall
terminate, or (ii) promptly honor its obligation to so issue and deliver to the Holder a certificate or certificates representing
such Ordinary Shares or credit the Holder’s balance account with DTC for the number of Ordinary Shares to which the Holder
is entitled upon the Holder’s conversion hereunder (as the case may be) and pay cash to the Holder in an amount equal to
the excess (if any) of the Buy-In Price over the product of (A) such number of Ordinary Shares multiplied by (B) the lowest Closing
Sale Price of the Ordinary Shares on any Trading Day during the period commencing on the date of the applicable Conversion Notice
and ending on the date of such issuance and payment under this clause (ii).


 



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(iii)          Registration;
Book-Entry. The Company shall maintain a register (the “Register”) for the recordation of the names and
addresses of the holders of each Note and the principal amount of the Notes held by such holders (the “Registered Notes”).
The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and the holders
of the Notes shall treat each Person whose name is recorded in the Register as the owner of a Note for all purposes (including,
without limitation, the right to receive payments hereunder, including payments of Principal and Interest) notwithstanding notice
to the contrary. A Registered Note may be assigned, transferred or sold in whole or in part only by registration of such assignment
or sale on the Register. Upon its receipt of a request to assign, transfer or sell all or part of any Registered Note by the holder
thereof (in accordance with the terms of this Note and the Securities Purchase Agreement, including Section 3(g) thereof), the
Company shall record the information contained therein in the Register and issue one or more new Registered Notes in the same aggregate
principal amount as the principal amount of the surrendered Registered Note to the designated assignee or transferee pursuant to
Section 19, provided that if the Company does not so record an assignment, transfer or sale (as the case may be) of all or part
of any Registered Note within two (2) Business Days of such a request, then the Register shall be automatically updated to reflect
such assignment, transfer or sale (as the case may be). Notwithstanding anything to the contrary set forth in this Section 3, following
conversion of any portion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender
this Note to the Company unless (A) the full Conversion Amount represented by this Note is being converted (in which event this
Note shall be delivered to the Company following conversion thereof as contemplated by Section 3(c)(i)) or (B) the Holder has provided
the Company with prior written notice (which notice may be included in a Conversion Notice) requesting reissuance of this Note
upon physical surrender of this Note. The Holder and the Company shall maintain records showing the Principal, Interest and Late
Charges converted and/or paid (as the case may be) and the dates of such conversions and/or payments (as the case may be) or shall
use such other method, reasonably satisfactory to the Holder and the Company, so as not to require physical surrender of this Note
upon partial conversion.


 



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(iv)          Pro
Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one holder of Notes for
the same Conversion Date and the Company can convert some, but not all, of such portions of the Notes submitted for conversion,
the Company, subject to Section 3(d), shall convert from each holder of Notes electing to have Notes converted on such date a pro
rata amount of such holder’s portion of its Notes submitted for conversion based on the principal amount of Notes submitted
for conversion on such date by such holder relative to the aggregate principal amount of all Notes submitted for conversion on
such date. In the event of a dispute as to the number of Ordinary Shares issuable to the Holder in connection with a conversion
of this Note, the Company shall issue to the Holder the number of Ordinary Shares not in dispute and resolve such dispute in accordance
with Section 24.


 


(d)          Limitations
on Conversions.


 


(i)          Beneficial
Ownership. Notwithstanding anything to the contrary contained in this Note, this Note shall not be convertible by the Holder
hereof, and the Company shall not effect any conversion of this Note or otherwise issue any Ordinary Shares pursuant to Section
8 hereof, to the extent (but only to the extent) that the Holder or any of its affiliates would beneficially own in excess of 4.9%
(the “Maximum Percentage”) of the Ordinary Shares. To the extent the above limitation applies, the determination
of whether this Note shall be convertible (vis-à-vis other convertible, exercisable or exchangeable securities owned by
the Holder or any of its affiliates) and of which such securities shall be convertible, exercisable or exchangeable (as among all
such securities owned by the Holder and its affiliates) shall, subject to such Maximum Percentage limitation, be determined on
the basis of the first submission to the Company for conversion, exercise or exchange (as the case may be). No prior inability
to convert this Note, or to issue Ordinary Shares, pursuant to this paragraph shall have any effect on the applicability of the
provisions of this paragraph with respect to any subsequent determination of convertibility. For purposes of this paragraph,
beneficial ownership and all determinations and calculations (including, without limitation, with respect to calculations of percentage
ownership) shall be determined in accordance with Section 13(d) of the 1934 Act (as defined in the Securities Purchase Agreement)
and the rules and regulations promulgated thereunder. The provisions of this paragraph shall be implemented in a manner otherwise
than in strict conformity with the terms of this paragraph to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Maximum Percentage beneficial ownership limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such Maximum Percentage limitation. The limitations contained in this paragraph
shall apply to a successor Holder of this Note. The holders of Ordinary Shares shall be third party beneficiaries of this paragraph
and the Company may not waive this paragraph without the consent of holders of a majority of its Ordinary Shares. For any reason
at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in
writing to the Holder the number of Ordinary Shares then outstanding, including by virtue of any prior conversion or exercise of
convertible or exercisable securities into Ordinary Shares, including, without limitation, pursuant to this Note or securities
issued pursuant to the Securities Purchase Agreement.


 



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4.          RIGHTS
UPON EVENT OF DEFAULT.


 


(a)          Event
of Default. Each of the following events shall constitute an “Event of Default”:


 


(i)          the
failure of the applicable Registration Statement (as defined in the Registration Rights Agreement) to be filed with the SEC on
or prior to the date that is five (5) Business Days after the applicable Filing Deadline (as defined in the Registration Rights
Agreement) or the failure of the applicable Registration Statement to be declared effective by the SEC on or prior to the date
that is ten (10) Business Days after the applicable Effectiveness Deadline (as defined in the Registration Rights Agreement);


 


(ii)         while
the applicable Registration Statement is required to be maintained effective pursuant to the terms of the Registration Rights Agreement,
the effectiveness of the applicable Registration Statement lapses for any reason (including, without limitation, the issuance of
a stop order) or such Registration Statement (or the prospectus contained therein) is unavailable to any holder of Registrable
Securities (as defined in the Registration Rights Agreement) for sale of all of such holder’s Registrable Securities in accordance
with the terms of the Registration Rights Agreement, and (I) such lapse or unavailability continues for a period of five (5) consecutive
Trading Days or for more than an aggregate of ten (10) Trading Days in any 365-day period (excluding days during an Allowable Grace
Period (as defined in the Registration Rights Agreement)) and (II) any such holder (who is not an affiliate of the Company) may
not then sell all of such holder’s Registrable Securities without restriction pursuant to Rule 144 (as defined in the Securities
Purchase Agreement);


 


(iii)        commencing
on the date on which the Company obtains the listing or quotation of the Ordinary Shares on the Principal Market in accordance
with Section 5(f) of the Securities Purchase Agreement (such date, the “Initial Quotation Date”), the suspension
from trading or the failure of the Ordinary Shares to be quoted, trading or listed (as applicable) on an Eligible Market on which
the Ordinary Shares as a class is then quoted, traded or listed (as applicable) for a period of five (5) consecutive Trading Days
or for more than an aggregate of ten (10) Trading Days in any 365 day period;


 


(iv)        the
Company’s (A) failure to cure a Conversion Failure or a Delivery Failure (as defined in the Warrants) by delivery of the
required number of Ordinary Shares within five (5) Trading Days after the applicable Conversion Date or exercise date (as the case
may be) or (B) notice, written or oral, to any holder of the Notes or Warrants, including, without limitation, by way of public
announcement or through any of its agents, at any time, of its intention not to comply, as required, with a request for conversion
of any Notes into Ordinary Shares that is requested in accordance with the provisions of the Notes, other than pursuant to Section
3(d) or a request for exercise of any Warrants for Warrant Shares in accordance with the provisions of the Warrants;


 



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(v)          at
any time following the tenth (10th) consecutive day that the Holder’s Authorized Share Allocation is less than
the number of Ordinary Shares that the Holder would be entitled to receive upon a conversion of the full Conversion Amount of this
Note (without regard to any limitations on conversion set forth in Section 3(d) or otherwise);


 


(vi)         the
Company’s or any Subsidiary’s failure to pay to the Holder any amount of Principal, Interest, Late Charges or other
amounts when and as due under this Note (including, without limitation, the Company’s or any Subsidiary’s failure to
pay any redemption payments or amounts hereunder) or any other Transaction Document (as defined in the Securities Purchase Agreement)
or any other agreement, document, certificate or other instrument delivered in connection with the transactions contemplated hereby
and thereby, except, in the case of a failure to pay Interest and Late Charges when and as due, in which case only if such failure
remains uncured for a period of at least five (5) days;


 


(vii)        the
Company fails to instruct and otherwise use its reasonable best efforts to cause the Transfer Agent to remove any restrictive legend
on any certificate or any Ordinary Shares issued to the Holder upon conversion or exercise (as the case may be) of any Securities
acquired by the Holder under the Securities Purchase Agreement (including this Note) as and when required by such Securities or
the Securities Purchase Agreement, unless otherwise then prohibited by applicable federal securities laws, and any such failure
of the Company remains uncured for at least five (5) days;


 


(viii)       the
occurrence of any default under, redemption of or acceleration prior to maturity of any Indebtedness (as defined in the Securities
Purchase Agreement) of the Company or any of its Subsidiaries, other than with respect to any Other Notes;


 


(ix)        bankruptcy,
insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by or
against the Company or any Subsidiary and, if instituted against the Company or any Subsidiary by a third party, shall not be dismissed
within thirty (30) days of their initiation;


 



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(x)          the
commencement by the Company or any Subsidiary of a voluntary case or proceeding under any applicable federal, state or foreign
bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or
insolvent, or the consent by it to the entry of a decree, order, judgment or other similar document in respect of the Company or
any Subsidiary in an involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization
or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it
of a petition or answer or consent seeking reorganization or relief under any applicable federal, state or foreign law, or the
consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or any Subsidiary or of any substantial part of its property,
or the making by it of an assignment for the benefit of creditors, or the execution of a composition of debts, or the occurrence
of any other similar federal, state or foreign proceeding, or the admission by it in writing of its inability to pay its debts
generally as they become due, the taking of corporate action by the Company or any Subsidiary in furtherance of any such action
or the taking of any action by any Person to commence a Uniform Commercial Code foreclosure sale or any other similar action under
federal, state or foreign law;


 


(xi)          the
entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company or any Subsidiary of a voluntary
or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other
similar law or (ii) a decree, order, judgment or other similar document adjudging the Company or any Subsidiary as bankrupt or
insolvent, or approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition
of or in respect of the Company or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order,
judgment or other similar document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or any Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree, order, judgment or other similar document or any such other decree, order,
judgment or other similar document unstayed and in effect for a period of thirty (30) consecutive days;


 


(xii)          a
final judgment or judgments for the payment of money aggregating in excess of $100,000 are rendered against the Company and/or
any of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged or stayed
pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any judgment
which is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $100,000 amount
set forth above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which written
statement shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an indemnity
and the Company or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty
(30) days of the issuance of such judgment;


 



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(xiii)          the
Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable grace
period, any payment with respect to any Indebtedness in excess of $100,000 due to any third party (other than, with respect to
unsecured Indebtedness only, payments contested by the Company and/or such Subsidiary (as the case may be) in good faith by proper
proceedings and with respect to which adequate reserves have been set aside for the payment thereof in accordance with IFRS) or
is otherwise in breach or violation of any agreement for monies owed or owing in an amount in excess of $100,000, which breach
or violation permits the other party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii) suffer
to exist any other circumstance or event that would, with or without the passage of time or the giving of notice, result in a default
or event of default under any agreement binding the Company or any Subsidiary, which default or event of default would or is likely
to have a Material Adverse Effect;


 


(xiv)          other
than as specifically set forth in another clause of this Section 4(a), the Company or any
Subsidiary breaches (if qualified by materiality) or materially breaches (if not qualified by materiality) any representation,
warranty, covenant or other term or condition of any Transaction Document (including, without limitation, the Guaranties (as defined
in the Securities Purchase Agreement) and the Security Documents (as defined in the Securities Purchase Agreement)), except, in
the case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured for a period
of five (5) days following receipt by the Company of notice thereof from the Holder;


 


(xv)          any
breach or failure in any respect by the Company or any Subsidiary to comply with any provision of either of Sections 8 or 14 of
this Note;


 


(xvi)          a
false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that the Equity Conditions
are satisfied, that there has been no Equity Conditions Failure or as to whether any Event of Default has occurred;


 


(xvii)          any
Material Adverse Effect (as defined in the Securities Purchase Agreement) occurs which is not cured, remedied or resolved by the
Company within five (5) days;


 


(xviii)          any
material provision or provisions (when taken together) of any Transaction Document (including, without limitation, the Guaranties
and the Security Documents) shall at any time for any reason (other than pursuant to the express terms thereof) cease to be valid
and binding on or enforceable against the parties thereto, or the validity or enforceability of any provision of any Transaction
Document shall be contested by the Company or any of its Subsidiaries, or a proceeding shall be commenced by the Company or any
Subsidiary or any governmental authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability
thereof, or the Company or any Subsidiary shall deny in writing that it has any liability or obligation created under any Transaction
Document (including, without limitation, the Guaranties and the Security Documents);


 



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(xix)        the
Security Documents shall for any reason fail or cease to create a separate valid and perfected and, except to the extent permitted
by the terms hereof or thereof, first priority Lien on the Collateral (as defined in the Security Agreement) and on the Charged
Assets (as defined in the UK Security Agreement) in favor of each of the Secured Parties (as respectively defined in the Security
Agreement and the UK Security Agreement);


 


(xx)         any
material damage to, or loss, theft or destruction of, any assets of the Company and its Subsidiaries, whether or not insured, or
any strike, lockout, labor dispute, embargo, condemnation, act of God or public enemy, or other casualty which causes, for more
than fifteen (15) consecutive days, the cessation or substantial curtailment of revenue producing activities at any facility of
the Company or any Subsidiary, if any such event or circumstance could have a Material Adverse Effect; or


 


(xxi)          any
Event of Default (as defined in the Other Notes) occurs with respect to any Other Notes.


 


(b)          Notice
of an Event of Default; Redemption Right. Upon the occurrence of an Event of Default with respect to this Note or any Other
Note, the Company shall within one (1) Business Day deliver written notice thereof via facsimile and overnight courier (with next
day delivery specified) (an “Event of Default Notice”) to the Holder. At any time after the earlier of the Holder’s
receipt of an Event of Default Notice and the Holder becoming aware of an Event of Default, the Holder may require the Company
to redeem (regardless of whether such Event of Default has been cured) all or any portion of this Note by delivering written notice
thereof (the “Event of Default Redemption Notice”) to the Company, which Event of Default Redemption Notice
shall indicate the portion of this Note the Holder is electing to redeem. Each portion of this Note subject to redemption by the
Company pursuant to this Section 4(b) shall be redeemed by the Company at a price (the “Event of Default Redemption
Price”) equal to the greater of (i) the product of (A) the Conversion Amount to be redeemed multiplied by (B) the Redemption
Premium and (ii) the product of (X) the Conversion Rate with respect to the Conversion Amount in effect at such time as the Holder
delivers an Event of Default Redemption Notice multiplied by (Y) the product of (1) the Equity Value Redemption Premium multiplied
by (2) the greatest Closing Sale Price of the Ordinary Shares on any Trading Day during the period commencing on the date immediately
preceding such Event of Default and ending on the date the Company makes the entire payment required to be made under this Section
4(b). Redemptions required by this Section 4(b) shall be made in accordance with the provisions of Section 11. To the extent redemptions
required by this Section 4(b) are deemed or determined by a court of competent jurisdiction to be prepayments of this Note by the
Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section
4, but subject to Section 3(d), until the Event of Default Redemption Price (together with any Late Charges thereon) is paid in
full, the Conversion Amount submitted for redemption under this Section 4(b) (together with any Late Charges thereon) may be converted,
in whole or in part, by the Holder into Ordinary Shares pursuant to the terms of this Note. In the event of the Company’s
redemption of any portion of this Note under this Section 4(b), the Holder’s damages would be uncertain and difficult to
estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability of a
suitable substitute investment opportunity for the Holder. Accordingly, any redemption premium due under this Section 4(b) is intended
by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment opportunity
and not as a penalty.


 



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5.          RIGHTS
UPON A FUNDAMENTAL TRANSACTION AND A PERMITTED PRIVATE PLACEMENT.


 


(a)          Assumption
upon a Fundamental Transaction. The Company shall not enter into or be party to a Fundamental Transaction unless (i) the
Successor Entity assumes in writing all of the obligations of the Company under this Note and the other Transaction Documents in
accordance with the provisions of this Section 5(a) pursuant to written agreements in form and substance satisfactory to the Holder
and approved by the Holder prior to such Fundamental Transaction, including agreements to deliver to each holder of Notes in exchange
for such Notes a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance
to the Notes, including, without limitation, having a principal amount and interest rate equal to the principal amounts then outstanding
and the interest rates of the Notes held by such holder, having similar conversion rights as the Notes and having similar ranking
to the Notes, having similar guarantees from the subsidiaries of the Successor Entity and a first priority lien on all of the assets
(to the extent such assets would constitute Collateral) of the Successor Entity, and satisfactory to the Holder and (ii) the
Successor Entity (including its Parent Entity) is a publicly traded corporation whose common stock is quoted on or listed for trading
on an Eligible Market. Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted
for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other Transaction Documents
referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of
the Company and shall assume all of the obligations of the Company under this Note and the other Transaction Documents with the
same effect as if such Successor Entity had been named as the Company herein. In addition to the foregoing, upon consummation of
a Fundamental Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall also be issued upon conversion
or redemption of this Note at any time after the consummation of such Fundamental Transaction, in lieu of the Ordinary Shares or
other securities, cash, assets or other property (except such items still issuable under Sections 6 and 16, which shall continue
to be receivable thereafter) issuable upon the conversion or redemption of the Notes prior to such Fundamental Transaction, such
shares of the publicly traded common stock (or their equivalent) of the Successor Entity (including its Parent Entity) which the
Holder would have been entitled to receive upon the happening of such Fundamental Transaction had this Note been converted immediately
prior to such Fundamental Transaction (without regard to any limitations on the conversion of this Note), as adjusted in accordance
with the provisions of this Note. The provisions of this Section 5 shall apply similarly and equally to successive Fundamental
Transactions and shall be applied without regard to any limitations on the conversion of this Note.


 



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(b)          Notice
of a Fundamental Transaction; Redemption Right. No sooner than twenty (20) Trading Days nor later than ten (10) Trading Days
prior to the consummation of a Fundamental Transaction, but not prior to the public announcement of such Fundamental Transaction,
the Company shall deliver written notice thereof via facsimile and overnight courier to the Holder (a “Fundamental Transaction
Notice”). At any time during the period beginning after the Holder’s receipt of a Fundamental Transaction Notice
or the Holder becoming aware of a Fundamental Transaction if a Fundamental Transaction Notice is not delivered to the Holder in
accordance with the immediately preceding sentence (as applicable) and ending on the later of twenty (20) Trading Days after (A)
consummation of such Fundamental Transaction or (B) the date of receipt of such Fundamental Transaction Notice, the Holder may
require the Company to redeem all or any portion of this Note by delivering written notice thereof (“Fundamental Transaction
Redemption Notice”) to the Company, which Fundamental Transaction Redemption Notice shall indicate the Conversion Amount
the Holder is electing to redeem. The portion of this Note subject to redemption pursuant to this Section 5 shall be redeemed by
the Company in cash at a price (the “Fundamental Transaction Redemption Price”) equal to the greatest
of (i) the product of (w) the Fundamental Transaction Redemption Premium multiplied by (x) the Conversion Amount being redeemed,
(ii) the product of (X) the Fundamental Transaction Redemption Premium multiplied by (Y) the product of (A) the Conversion Amount
being redeemed multiplied by (B) the quotient determined by dividing (1) the greatest Closing Sale Price of the Ordinary Shares
during the period beginning on the date immediately preceding the earlier to occur of (x) the consummation of the applicable Fundamental
Transaction and (y) the public announcement of such Fundamental Transaction and ending on the date the Holder delivers the Fundamental
Transaction Redemption Notice by (2) the Conversion Price in effect
at the time of delivery by the Holder of the Fundamental Transaction Redemption Notice and (iii) the product of (y) the
Fundamental Transaction Redemption Premium multiplied by (z) the product of (1) the Conversion Amount being redeemed multiplied
by (2) the quotient of (A) the aggregate cash consideration and the aggregate cash value of any non-cash consideration per Ordinary
Share to be paid to the holders of the Ordinary Shares upon consummation of such Fundamental Transaction (any such non-cash consideration
constituting publicly-traded securities shall be valued at the highest of the Closing Sale Price of such securities as of the Trading
Day immediately prior to the consummation of such Fundamental Transaction, the Closing Sale Price of such securities on the Trading
Day immediately following the public announcement of such proposed Fundamental Transaction and the Closing Sale Price of such securities
on the Trading Day immediately prior to the public announcement of such proposed Fundamental Transaction) divided by (B) the Conversion
Price then in effect. Redemptions required by this Section 5 shall be made in accordance with the provisions of Section 11 and
shall have priority to payments to stockholders in connection with such Fundamental Transaction. To the extent redemptions required
by this Section 5(b) are deemed or determined by a court of competent jurisdiction to be prepayments of this Note by the Company,
such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section 5, but subject
to Section 3(d), until the Fundamental Transaction Redemption Price (together with any Late Charges thereon) is paid in full, the
Conversion Amount submitted for redemption under this Section 5(b) (together with any Late Charges thereon) may be converted, in
whole or in part, by the Holder into Ordinary Shares pursuant to Section 3. In the event of the Company’s redemption of any
portion of this Note under this Section 5(b), the Holder’s damages would be uncertain and difficult to estimate because of
the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute
investment opportunity for the Holder. Accordingly, any redemption premium due under this Section 5(b) is intended by the parties
to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment opportunity and not as a
penalty.


 



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(c)          Notice
of a Permitted Private Placement; Redemption Right. On or prior to the fifth (5th) Trading Day prior to the consummation
of a Permitted Private Placement (as defined in the Securities Purchase Agreement), the Company shall deliver written notice thereof
via facsimile and overnight courier to the Holder (a “Permitted Private Placement Notice”). At any time
during the period beginning after the Holder’s receipt of a Permitted Private Placement Notice or the Holder becoming aware
of a Permitted Private Placement if a Permitted Private Placement Notice is not delivered to the Holder in accordance with the
immediately preceding sentence (as applicable) and ending on the later of twenty (20) Trading Days after (A) consummation of such
Permitted Private Placement or (B) the date of receipt of such Permitted Private Placement Notice, the Holder may require the Company
to redeem all or any portion of this Note by delivering written notice thereof (“Permitted Private Placement Redemption
Notice”) to the Company, which Permitted Private Placement Redemption Notice shall indicate the Conversion Amount the
Holder is electing to redeem. The portion of this Note subject to redemption pursuant to this Section 5(c) shall be redeemed by
the Company in cash at a price (the “Permitted Private Placement Redemption Price”) equal to the Conversion
Amount. The Permitted Private Placement Redemption Price shall be paid directly from the proceeds of the Permitted Private Placement.
To the extent redemptions required by this Section 5(c) are deemed or determined by a court of competent jurisdiction to be prepayments
of this Note by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary
in this Section 5, but subject to Section 3(d), until the Permitted Private Placement Redemption Price (together with any Late
Charges thereon) is paid in full, the Conversion Amount submitted for redemption under this Section 5(c) (together with any Late
Charges thereon) may be converted, in whole or in part, by the Holder into Ordinary Shares pursuant to Section 3. In the event
of the Company’s redemption of any portion of this Note under this Section 5(c), the Holder’s damages would be uncertain
and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability
of a suitable substitute investment opportunity for the Holder. Accordingly, any redemption premium (if any) due under this Section
5(c) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment
opportunity and not as a penalty.


 



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6.          RIGHTS
UPON ISSUANCE OF PURCHASE RIGHTS AND OTHER CORPORATE EVENTS.


 


(a)          Purchase
Rights. In addition to any adjustments pursuant to Section 7 below, if at any time the Company grants, issues or sells any
Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to all or substantially
all of the record holders of any class of Ordinary Shares (the “Purchase Rights”), then the Holder will be entitled
to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired
if the Holder had held the number of Ordinary Shares acquirable upon complete conversion of this Note (without taking into account
any limitations or restrictions on the convertibility of this Note) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of
Ordinary Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that
the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Maximum Percentage,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such Ordinary
Shares as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for
the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Maximum Percentage).


 


(b)          Other
Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Fundamental
Transaction pursuant to which holders of Ordinary Shares are entitled to receive securities or other assets with respect to or
in exchange for Ordinary Shares (a “Corporate Event”), the Company shall make appropriate provision to insure
that the Holder will thereafter have the right to receive upon a conversion of this Note (i) in addition to the Ordinary Shares
receivable upon such conversion, such securities or other assets to which the Holder would have been entitled with respect to such
Ordinary Shares had such Ordinary Shares been held by the Holder upon the consummation of such Corporate Event (without taking
into account any limitations or restrictions on the convertibility of this Note) or (ii) in lieu of the Ordinary Shares otherwise
receivable upon such conversion, such securities or other assets received by the holders of Ordinary Shares in connection with
the consummation of such Corporate Event in such amounts as the Holder would have been entitled to receive had this Note initially
been issued with conversion rights for the form of such consideration (as opposed to Ordinary Shares) at a conversion rate for
such consideration commensurate with the Conversion Rate. Provision made pursuant to the preceding sentence shall be in a form
and substance satisfactory to the Holder. The provisions of this Section 6 shall apply similarly and equally to successive Corporate
Events and shall be applied without regard to any limitations on the conversion or redemption of this Note.


 


7.          RIGHTS
UPON ISSUANCE OF OTHER SECURITIES.


 


(a)          Adjustment
of Conversion Price upon Issuance of Ordinary Shares. If and whenever on or after the Subscription Date the Company issues
or sells, or in accordance with this Section 7(a) is deemed to have issued or sold, any Ordinary Shares (including the issuance
or sale of Ordinary Shares owned or held by or for the account of the Company, but excluding any Excluded Securities (as defined
in the Securities Purchase Agreement) issued or sold or deemed to have been issued or sold) for a consideration per share (the
“New Issuance Price”) less than a price equal to the Conversion Price in effect immediately prior to such issue
or sale or deemed issuance or sale (such Conversion Price then in effect is referred to herein as the “Applicable Price”)
(the foregoing a “Dilutive Issuance”), then, immediately after such Dilutive Issuance, the Conversion Price
then in effect shall be reduced to an amount equal to the New Issuance Price. For all purposes of the foregoing (including, without
limitation, determining the adjusted Conversion Price and consideration per share under this Section 7(a)), the following shall
be applicable:


 



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(i)          Issuance
of Options. If the Company in any manner grants or sells any Options and the lowest price per share for which one Ordinary
Share is issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible Securities issuable
upon exercise of any such Option is less than the Applicable Price, then such Ordinary Share shall be deemed to be outstanding
and to have been issued and sold by the Company at the time of the granting or sale of such Option for such price per share. For
purposes of this Section 7(a)(i), the “lowest price per share for which one Ordinary Share is issuable upon the exercise
of any such Options or upon conversion, exercise or exchange of any Convertible Securities issuable upon exercise of any such Option”
shall be equal to (1) the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect
to any one Ordinary Share upon the granting or sale of such Option, upon exercise of such Option and upon conversion, exercise
or exchange of any Convertible Security issuable upon exercise of such Option minus (2) the sum of all amounts paid or payable
to the holder of such Option (or any other Person) upon the granting or sale of such Option, upon exercise of such Option and upon
conversion, exercise or exchange of any Convertible Security issuable upon exercise of such Option plus the value of any other
consideration received or receivable by, or benefit conferred on, the holder of such Option (or any other Person). Except as contemplated
below, no further adjustment of the Conversion Price shall be made upon the actual issuance of such Ordinary Share or of such Convertible
Securities upon the exercise of such Options or upon the actual issuance of such Ordinary Share upon conversion, exercise or exchange
of such Convertible Securities.


 


(ii)          Issuance
of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the lowest price per
share for which one Ordinary Share is issuable upon the conversion, exercise or exchange thereof is less than the Applicable Price,
then such Ordinary Share shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the issuance
or sale of such Convertible Securities for such price per share. For the purposes of this Section 7(a)(ii), the “lowest price
per share for which one Ordinary Share is issuable upon the conversion, exercise or exchange thereof” shall be equal to (1)
the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to one Ordinary Share
upon the issuance or sale of the Convertible Security and upon conversion, exercise or exchange of such Convertible Security minus
(2) the sum of all amounts paid or payable to the holder of such Convertible Security (or any other Person) upon the issuance or
sale of such Convertible Security plus the value of any other consideration received or receivable by, or benefit conferred on,
the holder of such Convertible Security (or any other Person). Except as contemplated below, no further adjustment of the Conversion
Price shall be made upon the actual issuance of such Ordinary Share upon conversion, exercise or exchange of such Convertible Securities,
and if any such issue or sale of such Convertible Securities is made upon exercise of any Options for which adjustment of the Conversion
Price has been or is to be made pursuant to other provisions of this Section 7(a), except as contemplated below, no further adjustment
of the Conversion Price shall be made by reason of such issue or sale.


 



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(iii)          Change
in Option Price or Rate of Conversion. If the purchase or exercise price provided for in any Options, the additional consideration,
if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for Ordinary Shares increases or decreases at any time, the Conversion
Price in effect at the time of such increase or decrease shall be adjusted to the Conversion Price which would have been in effect
at such time had such Options or Convertible Securities provided for such increased or decreased purchase price, additional consideration
or increased or decreased conversion rate (as the case may be) at the time initially granted, issued or sold. For purposes of this
Section 7(a)(iii), if the terms of any Option or Convertible Security that was outstanding as of the Subscription Date are increased
or decreased in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the Ordinary
Shares deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such
increase or decrease. No adjustment pursuant to this Section 7(a) shall be made if such adjustment would result in an increase
of the Conversion Price then in effect.


 


(iv)          Calculation
of Consideration Received. If any Option or Convertible Security is issued or deemed issued in connection with the issuance
or sale or deemed issuance or sale of any other securities of the Company, together comprising one integrated transaction, (x)
such Option or Convertible Security (as applicable) will be deemed to have been issued for consideration equal to the Black Scholes
Consideration Value thereof and (y) the other securities issued or sold or deemed to have been issued or sold in such integrated
transaction shall be deemed to have been issued for consideration equal to the difference of (I) the aggregate consideration received
by the Company minus (II) the Black Scholes Consideration Value of each such Option or Convertible Security (as applicable). If
any Ordinary Shares, Options or Convertible Securities are issued or sold or deemed to have been issued or sold for cash, the consideration
received therefor will be deemed to be the net amount received by the Company therefor. If any Ordinary Shares, Options or Convertible
Securities are issued or sold for a consideration other than cash, the amount of such consideration received by the Company will
be the fair value of such consideration, except where such consideration consists of publicly traded securities, in which case
the amount of consideration received by the Company for such securities will be the average VWAP of such security for the five
(5) Trading Day period immediately preceding the date of receipt. If any Ordinary Shares, Options or Convertible Securities are
issued to the owners of the non-surviving entity in connection with any merger in which the Company is the surviving entity, the
amount of consideration therefor will be deemed to be the fair value of such portion of the net assets and business of the non-surviving
entity as is attributable to such Ordinary Shares, Options or Convertible Securities (as the case may be). The fair value of any
consideration other than cash or publicly traded securities will be determined jointly by the Company and the Holder. If such parties
are unable to reach agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation
Event”), the fair value of such consideration will be determined within five (5) Trading Days after the tenth (10th)
day following such Valuation Event by an independent, reputable appraiser jointly selected by the Company and the Holder. The determination
of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser
shall be borne by the Company.


 



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(v)          Record
Date. If the Company takes a record of the holders of Ordinary Shares for the purpose of entitling them (A) to receive a dividend
or other distribution payable in Ordinary Shares, Options or in Convertible Securities or (B) to subscribe for or purchase shares
of Ordinary Shares, Options or Convertible Securities, then such record date will be deemed to be the date of the issue or sale
of the Ordinary Shares deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution
or the date of the granting of such right of subscription or purchase (as the case may be).


 


(b)          Adjustment
of Conversion Price upon Subdivision or Combination of Ordinary Shares. Without limiting any provision of Section 5 or Section
7(a), if the Company at any time on or after the Subscription Date subdivides (by any stock split, stock dividend, recapitalization
or otherwise) one or more classes of its outstanding Ordinary Shares into a greater number of shares, the Conversion Price in effect
immediately prior to such subdivision will be proportionately reduced. Without limiting any provision of Section 5 or Section 7(a),
if the Company at any time on or after the Subscription Date combines (by combination, reverse stock split or otherwise) one or
more classes of its outstanding Ordinary Shares into a smaller number of shares, the Conversion Price in effect immediately prior
to such combination will be proportionately increased. Any adjustment pursuant to this Section 7(b) shall become effective immediately
after the effective date of such subdivision or combination. If any event requiring an adjustment under this Section 7(b) occurs
during the period that a Conversion Price is calculated hereunder, then the calculation of such Conversion Price shall be adjusted
appropriately to reflect such event.


 


(c)          Other
Events. In the event that the Company (or any Subsidiary) shall take any action to which the provisions hereof are not strictly
applicable, or, if applicable, would not operate to protect the Holder from dilution or if any event occurs of the type contemplated
by the provisions of this Section 7 but not expressly provided for by such provisions (including, without limitation, the granting
of stock appreciation rights, phantom stock rights or other rights with equity features), then the Company’s board of directors
shall in good faith determine and implement an appropriate adjustment in the Conversion Price so as to protect the rights of the
Holder, provided that no such adjustment pursuant to this Section 7(c) will increase the Conversion Price as otherwise determined
pursuant to this Section 7, provided further that if the Holder does not accept such adjustments as appropriately protecting its
interests hereunder against such dilution, then the Company’s board of directors and the Holder shall agree, in good faith,
upon an independent investment bank of nationally recognized standing to make such appropriate adjustments, whose determination
shall be final and binding and whose fees and expenses shall be borne by the Company.


 



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8.          NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation (as defined
in the Securities Purchase Agreement), Bylaws (as defined in the Securities Purchase Agreement) or through any reorganization,
transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in good faith
carry out all of the provisions of this Note and take all action as may be required to protect the rights of the Holder of this
Note. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any Ordinary Shares
receivable upon conversion of this Note above the Conversion Price then in effect, (ii) shall take all such actions as may
be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable Ordinary Shares
upon the conversion of this Note, and (iii) shall, so long as any of the Notes are outstanding, take all action necessary to reserve
and keep available out of its authorized and unissued Ordinary Shares, solely for the purpose of effecting the conversion of the
Notes, the maximum number of Ordinary Shares as shall from time to time be necessary to effect the conversion of the Notes then
outstanding (without regard to any limitations on conversion).


 


9.          RESERVATION
OF AUTHORIZED SHARES.


 


(a)          Reservation.
The Company shall initially reserve out of its authorized and unissued Ordinary Shares a number of Ordinary Shares for each of
the Notes equal to 133% of the entire Conversion Rate with respect to the entire Conversion Amount of each such Note as of the
Issuance Date (without giving effect to Section 3(d)). So long as any of the Notes are outstanding, the Company shall take
all action necessary to reserve and keep available out of its authorized and unissued Ordinary Shares, solely for the purpose of
effecting the conversion of the Notes, 133% of the number of Ordinary Shares as shall from time to time be necessary to effect
the conversion of all of the Notes then outstanding (without giving effect to Section 3(d)), provided that at no time shall the
number of Ordinary Shares so reserved be less than the number of shares required to be reserved by the previous sentence (without
regard to any limitations on conversions) (the “Required Reserve Amount”). The initial number of Ordinary Shares
reserved for conversions of the Notes and each increase in the number of shares so reserved shall be allocated pro rata among the
holders of the Notes based on the original principal amount of the Notes held by each holder on the Closing Date or increase in
the number of reserved shares (as the case may be) (the “Authorized Share Allocation”). In the event that a
Holder shall sell or otherwise transfer any of such Holder’s Notes, each transferee shall be allocated a pro rata portion
of such Holder’s Authorized Share Allocation. Any Ordinary Shares reserved and allocated to any Person which ceases to hold
any Notes shall be allocated to the remaining Holders of Notes, pro rata based on the principal amount of the Notes then held by
such Holders.


 



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(b)          Insufficient
Authorized Shares. If, notwithstanding Section 10(a), and not in limitation thereof, at any time while any of the Notes remain
outstanding the Company does not have a sufficient number of authorized and unreserved Ordinary Shares to satisfy its obligation
to reserve for issuance upon conversion of the Notes at least a number of Ordinary Shares equal to the Required Reserve Amount
(an “Authorized Share Failure”), then the Company shall immediately take all action necessary to increase the
Company’s authorized Ordinary Shares to an amount sufficient to allow the Company to reserve the Required Reserve Amount
for the Notes then outstanding. Without limiting the generality of the foregoing sentence, to the extent required by law or the
rules of the Eligible Market on which the Ordinary Shares are traded or quoted, as soon as practicable after the date of the occurrence
of an Authorized Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized Share Failure,
the Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized Ordinary Shares.
In connection with such meeting, to the extent required by law or the rules of the Eligible Market on which the Ordinary Shares
are traded or quoted, the Company shall provide each stockholder with a proxy statement and shall use its best efforts to solicit
its stockholders’ approval of such increase in authorized Ordinary Shares and to cause its board of directors to recommend
to the stockholders that they approve such proposal.


 


10.          [RESERVED]



 


11.          REDEMPTIONS.


 


(a)          Mechanics.
The Company shall deliver the applicable Event of Default Redemption Price to the Holder in cash within three (3) Business Days
after the Company’s receipt of the Holder’s Event of Default Redemption Notice. If the Holder has submitted a Fundamental
Transaction Redemption Notice or a Permitted Private Placement Redemption Notice (as the case may be) in accordance with Sections
5(b) or 5(c), the Company shall deliver the applicable Fundamental Transaction Redemption Price or Permitted Private Placement
Redemption Price to the Holder in cash concurrently with the consummation of such Fundamental Transaction or such Permitted Private
Placement (as the case may be) if such notice is received prior to the consummation of such Fundamental Transaction or such Permitted
Private Placement and within three (3) Business Days after the Company’s receipt of such notice otherwise. In the event of
a redemption of less than all of the Conversion Amount of this Note, the Company shall promptly cause to be issued and delivered
to the Holder a new Note (in accordance with Section 19(d)) representing the outstanding Principal which has not been redeemed.
In the event that the Company does not pay the applicable Redemption Price to the Holder within the time period required, at any
time thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option, in lieu of redemption,
to require the Company to promptly return to the Holder all or any portion of this Note representing the Conversion Amount that
was submitted for redemption and for which the applicable Redemption Price (together with any Late Charges thereon) has not been
paid. Upon the Company’s receipt of such notice, (x) the applicable Redemption Notice shall be null and void with respect
to such Conversion Amount, (y) the Company shall immediately return this Note, or issue a new Note (in accordance with Section
19(d)), to the Holder, and in each case the principal amount of this Note or such new Note (as the case may be) shall be increased
by an amount equal to the difference between (1) the applicable Event of Default Redemption Price or Fundamental Transaction Redemption
Price (as the case may be) minus (2) the Principal portion of the Conversion Amount submitted for redemption and (z) the Conversion
Price of this Note or such new Notes (as the case may be) shall be automatically adjusted with respect to each conversion effected
thereafter by the Holder to the lowest of (A) the Conversion Price as in effect on the date on which the applicable Redemption
Notice is voided, (B) 85% of the lowest Closing Bid Price of the Ordinary Shares during the period beginning on and including the
date on which the applicable Redemption Notice is delivered to the Company and ending on and including the date on which the applicable
Redemption Notice is voided and (C) 85% of the arithmetic average of the VWAPs of the Ordinary Shares for the five (5) Trading
Day period immediately preceding the Conversion Date of the applicable conversion. The Holder’s delivery of a notice voiding
a Redemption Notice and exercise of its rights following such notice shall not affect the Company’s obligations to make any
payments of Late Charges which have accrued prior to the date of such notice with respect to the Conversion Amount subject to such
notice.


 



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(b)          Redemption
by Other Holders. Upon the Company’s receipt of notice from any of the holders of the Other Notes for redemption or repayment
as a result of an event or occurrence substantially similar to the events or occurrences described in Section 4(a) or Section 5(a)
(each, an “Other Redemption Notice”), the Company shall immediately, but no later than one (1) Business Day
of its receipt thereof, forward to the Holder by facsimile a copy of such notice. If the Company receives a Redemption Notice and
one or more Other Redemption Notices, during the seven (7) Business Day period beginning on and including the date which is three
(3) Business Days prior to the Company’s receipt of the Holder’s applicable Redemption Notice and ending on and including
the date which is three (3) Business Days after the Company’s receipt of the Holder’s applicable Redemption Notice
and the Company is unable to redeem all principal, interest and other amounts designated in such Redemption Notice and such Other
Redemption Notices received during such seven (7) Business Day period, then the Company shall redeem a pro rata amount from each
holder of the Notes (including the Holder) based on the principal amount of the Notes submitted for redemption pursuant to such
Redemption Notice and such Other Redemption Notices received by the Company during such seven (7) Business Day period.


 


12.          VOTING
RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law (including, without limitation,
the Delaware General Corporation Law) and as expressly provided in this Note.


 


13.          COVENANTS.
Until all of the Notes have been converted, redeemed or otherwise satisfied in accordance with their terms:


 


(a)          Rank.
All payments due under this Note shall (a) rank pari passu with all Other Notes, and (b) be senior to all other Indebtedness
of the Company and its Subsidiaries.


 


(b)          Incurrence
of Indebtedness. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
incur or guarantee, assume or suffer to exist any Indebtedness (other than Permitted Indebtedness).


 



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(c)          Existence
of Liens. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, allow
or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”)
other than Permitted Liens.


 


(d)          Restricted
Payments. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part,
whether by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness,
whether by way of payment in respect of principal of (or premium, if any) or interest on, such Indebtedness.


 


(e)          Restriction
on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly
or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its capital stock.


 


(f)          Restriction
on Transfer of Assets. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
sell, lease, license, assign, transfer, convey or otherwise dispose of any assets or rights of the Company or any Subsidiary (including
the securities of any Subsidiary) owned or hereafter acquired whether in a single transaction or a series of related transactions,
other than (i) sales, leases, licenses, assignments, transfers, conveyances and other dispositions of such assets or rights by
the Company and its Subsidiaries that, in the aggregate, do not have a fair market value in excess of $2,000,000 in any twelve
(12) month period, (ii) sales of inventory in the ordinary course of business or (iii) any Permitted Ophthalmology Transaction;
provided, however, that, in the case of clauses (i) or (iii), the Company (or Subsidiary as the case may be) shall
deposit any proceeds thereof in one or more deposit accounts in the United States subject to U.S. deposit
account control agreements satisfying the requirements of Section 9-104(a)(2) of the Uniform Commercial Code which funds shall
be restricted from release absent the prior written consent of the holders of the Notes. Any deposit account control agreements
will (A) provide for the automatic termination of such agreement upon the indefeasible satisfaction in full of the Notes, (B) provide
that the amounts subject to such restrictions shall not exceed 110% of the Principal amount of the Notes, and (C) provide that
the Holder shall provide its reasonable cooperation as expeditiously as practicable to the extent such cooperation is required
by the depositary institution at which the deposit account is held to effectuate either clause (A) or (B) of this sentence. 


 


(g)          Maturity
of Indebtedness. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
permit any Indebtedness of the Company or any of its Subsidiaries to mature or accelerate prior to the Maturity Date.


 


(h)          New
Subsidiaries. Simultaneously with the acquisition or formation of each New Subsidiary, the Company shall cause such New Subsidiary
to execute, and deliver to each holder of Notes, Guaranties and Security Documents, as requested by the Holder. The Company shall
not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, acquire or form any New Subsidiary if
such New Subsidiary would not be wholly-owned, directly or indirectly, by the Company.


 



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(i)          Change
in Nature of Business. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or
indirectly, engage in any material line of business substantially different from those lines of business conducted by the Company
and each of its Subsidiaries on the Issuance Date or any business substantially related or incidental thereto. The Company shall
not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, modify its or their corporate structure
or purpose.


 


(j)          Issuance
of Equity Other Than for Cash. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly
or indirectly, issue shares of capital stock of the Company or any Subsidiary or securities convertible or exercisable into or
exchangeable for shares of capital stock of the Company or any Subsidiary (collectively, “Equity Securities”),
except (i) in a transaction where all such shares of capital stock are issued solely for cash or as compensation for services,
provided that in the case of compensation for services, such compensation for services is pursuant to a written agreement that
is approved by the Board of Directors, (ii) the issuance of Ordinary Shares or standard options to purchase Ordinary Shares to
directors, officers, employees, consultants or agents of the Company in their capacities as such (which clause (ii) shall be subject
to the limitations of Section 5(k) of the Securities Purchase Agreement during the relevant period set forth thereunder), or (iii)
the issuance of shares of capital stock in connection with a consolidation, merger, acquisition or other bona fide business combination
transaction (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement), provided that
(A) such transaction is a strategic transaction that is approved by a majority of the disinterested directors of the Company, (B)
the majority of the disinterested directors of the Company determines that such transaction shall be in the best interests of the
Company, and (C) any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through
its subsidiaries, an operating company or an owner of an asset or business subject to such transaction, but shall not include a
transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities. For the avoidance of doubt, the Company shall not, and the Company shall cause each of its
Subsidiaries to not, directly or indirectly, issue shares of such capital stock in exchange for the satisfaction or cancellation,
in whole or in part, of any other securities or instruments, or any receivables, claims, judgments or other liabilities of the
Company or any Subsidiary.


 


14.          GUARANTIES
AND SECURITY. Each existing and future Subsidiary shall jointly and severally, unconditionally guarantee all obligations under
the Notes on a senior basis pursuant to the Guaranties. This Note and the Other Notes are secured to the extent and in the manner
set forth in the Transaction Documents (including, without limitation, the Security Agreement, the other Security Documents and
the Guaranties).


 



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15.          PARTICIPATION.
In addition to any adjustments pursuant to Section 7, if the Company shall declare or make any dividend or other distribution of
its assets (or rights to acquire its assets) to holders of Ordinary Shares, by way of return of capital or otherwise (including,
without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification,
corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time
after the issuance of this Note, then, in each such case, the Holder shall be entitled to participate in such Distribution to the
same extent that the Holder would have participated therein if the Holder had held the number of Ordinary Shares acquirable upon
complete conversion of this Note (without regard to any limitations on conversion hereof, including without limitation, the Maximum
Percentage) immediately before the date on which a record is taken for such Distribution, or, if no such record is taken, the date
as of which the record holders of Ordinary Shares are to be determined for the participation in such Distribution (provided, however,
to the extent that the Holder’s right to participate in any such Distributions would result in the Holder exceeding the Maximum
Percentage, then the Holder shall not be entitled to participate in such Distribution to such extent (or the beneficial ownership
of any such Ordinary Shares as a result of such Distribution to such extent) and such Distribution to such extent shall be held
in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding
the Maximum Percentage).


 


16.          AMENDING
THE TERMS OF THIS NOTE. Provisions of this Note may be amended only with the written consent of the Company and the Required
Holders. Any amendment effected in accordance with this Section 17 shall be binding upon the Holder and the Company, provided that
no such amendment shall be effective to the extent that it (1) applies to less than all of the holders of Notes, (2) imposes any
obligation or liability on the Holder without the Holder’s prior written consent (which may be granted or withheld in the
Holder’s sole discretion) or (3) applies retroactively. Notwithstanding the foregoing, nothing contained in this Section
17 shall permit any amendment to be made to any provision of Section 3(d)(i).


 


17.          TRANSFER.
This Note and any Ordinary Shares issued upon conversion of this Note may be offered, sold, assigned or transferred by the Holder
without the consent of the Company, subject only to the provisions of Section 3(g) of the Securities Purchase Agreement and subject
to the Holder delivering written notice to the Company of all information relating to any subsequent purchaser, assignee or transferee
of the Note so that the Company may keep an accurate record of all the then current holders of the Notes.


 


18.          REISSUANCE
OF THIS NOTE.


 


(a)          Transfer.
If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Note (in accordance with Section 19(d)), registered as the Holder may request, representing
the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal is being transferred,
a new Note (in accordance with Section 19(d)) to the Holder representing the outstanding Principal not being transferred. The Holder
and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of Section 3(c)(iii) following
conversion or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal
stated on the face of this Note.


 



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(b)          Lost,
Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Note (as to which a written certification and the indemnification contemplated below shall suffice
as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company
in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company shall
execute and deliver to the Holder a new Note (in accordance with Section 19(d)) representing the then outstanding Principal of
this Note.


 


(c)          Note
Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal
office of the Company, for a new Note or Notes (in accordance with Section 19(d) and in principal amounts of at least $1,000) representing
in the aggregate the then outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding
Principal as is designated by the Holder at the time of such surrender.


 


(d)          Issuance
of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i) shall
be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding
at that time (or in the case of a new Note being issued pursuant to Section 19(a) or Section 19(c), the Principal designated by
the Holder which, when added to the principal represented by the other new Notes issued in connection with such issuance, does
not exceed the Principal remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have
an issuance date, as indicated on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have
the same rights and conditions as this Note, and (v) shall represent accrued and unpaid Interest and Late Charges on the Principal
and Interest of this Note, from the Issuance Date.


 


19.          REMEDIES,
CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Note shall be cumulative
and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity
(including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note. The Company
covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly provided herein.
Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall
be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation
of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that,
in the event of any such breach or threatened breach, the Holder shall be entitled, in addition to all other available remedies,
to an injunction restraining any such breach or any such threatened breach, without the necessity of showing economic loss and
without any bond or other security being required. The Company shall provide all information and documentation to the Holder that
is requested by the Holder to enable the Holder to confirm the Company’s compliance with the terms and conditions of this
Note (including, without limitation, compliance with Section 7).


 



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20.          PAYMENT
OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection or enforcement
or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this
Note or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the Company
or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay
the costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization,
receivership or other proceeding, including, without limitation, reasonable attorneys’ fees and disbursements. The Company
expressly acknowledges and agrees that no amounts due under this Note shall be affected, or limited, by the fact that the Purchase
Price paid for this Note was less than the original Principal amount hereof.


 


21.          CONSTRUCTION;
HEADINGS. This Note shall be deemed to be jointly drafted by the Company and the Holder and shall not be construed against
any Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of, or affect
the interpretation of, this Note. Terms used in this Note but defined in the other Transaction Documents shall have the meanings
ascribed to such terms on the Closing Date in such other Transaction Documents unless otherwise consented to in writing by the
Required Holders.


 


22.          FAILURE
OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and
signed by an authorized representative of the waiving party.


 


23.          DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Conversion Price, the Closing Bid Price, the Closing Sale
Price or fair market value (as the case may be) or the arithmetic calculation of the Conversion Rate or the applicable Redemption
Price (as the case may be), the Company or the Holder (as the case may be) shall submit the disputed determinations or arithmetic
calculations (as the case may be) via facsimile (i) within two (2) Business Days after receipt of the applicable notice giving
rise to such dispute to the Company or the Holder (as the case may be) or (ii) if no notice gave rise to such dispute, at any time
after the Holder learned of the circumstances giving rise to such dispute (including, without limitation, as to whether any issuance
or sale or deemed issuance or sale was an issuance or sale or deemed issuance or sale of Excluded Securities). If the Holder and
the Company are unable to agree upon such determination or calculation within two (2) Business Days of such disputed determination
or arithmetic calculation (as the case may be) being submitted to the Company or the Holder (as the case may be), then the Company
shall, within two (2) Business Days, submit via facsimile (a) the disputed determination of the Conversion Price, the Closing Bid
Price, the Closing Sale Price or fair market value (as the case may be) to an independent, reputable investment bank selected by
the Holder and reasonably acceptable to the Company or (b) the disputed arithmetic calculation of the Conversion Rate or any Redemption
Price (as the case may be) to an independent, outside accountant selected by the Holder and reasonably acceptable to the Company.
The Company shall cause at its expense the investment bank or the accountant (as the case may be) to perform the determinations
or calculations (as the case may be) and notify the Company and the Holder of the results no later than ten (10) Business Days
from the time it receives such disputed determinations or calculations (as the case may be). Such investment bank’s or accountant’s
determination or calculation (as the case may be) shall be binding upon all parties absent demonstrable error.


 



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24.          NOTICES;
PAYMENTS.


 


(a)          Notices.
Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance
with Section 10(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all
actions taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefor. Without
limiting the generality of the foregoing, the Company will give written notice to the Holder (i) immediately upon any adjustment
of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least
fifteen (15) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or
distribution upon the Ordinary Shares, (B) with respect to any grant, issuances, or sales of any Options, Convertible Securities
or rights to purchase stock, warrants, securities or other property to all or substantially all holders of Ordinary Shares or (C)
for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that
such information shall be made known to the public prior to or in conjunction with such notice being provided to the Holder.


 


(b)          Currency.
All dollar amounts referred to in this Note are in United States Dollars (“U.S. Dollars”), and all amounts owing
under this Note shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be converted into the
U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate”
means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Note, the U.S. Dollar exchange
rate as published in the Wall Street Journal on the relevant date of calculation (it being understood and agreed that where an
amount is calculated with reference to, or over, a period of time, the date of calculation shall be the final date of such period
of time).


 


(c)          Payments.
Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, unless otherwise expressly set forth
herein, such payment shall be made in lawful money of the United States of America by a certified check drawn on the account of
the Company and sent via overnight courier service to such Person at such address as previously provided to the Company in writing
(which address, in the case of each of the Buyers (as defined in the Securities Purchase Agreement), shall initially be as set
forth on the Schedule of Buyers attached to the Securities Purchase Agreement), provided that the Holder may elect to receive a
payment of cash via wire transfer of immediately available funds by providing the Company with prior written notice setting out
such request and the Holder’s wire transfer instructions. Whenever any amount expressed to be due by the terms of this Note
is due on any day which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day.
Any amount of Principal or other amounts due under the Transaction Documents which is not paid when due shall result in a late
charge being incurred and payable by the Company in an amount equal to interest on such amount at the rate of eighteen percent
(18%) per annum from the date such amount was due until the same is paid in full (“Late Charge”).


 



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25.          CANCELLATION.
After all Principal, accrued Interest, Late Charges and other amounts at any time owed on this Note have been paid in full (including
by way of conversion and/or redemption), this Note shall automatically be deemed canceled, shall be surrendered to the Company
for cancellation and shall not be reissued.


 


26.          WAIVER
OF NOTICE. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest and all
other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note and the
Securities Purchase Agreement.


 


27.          GOVERNING
LAW. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits
to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication
of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue
of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. In the event that any provision of this Note is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall
be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under
any law shall not affect the validity or enforceability of any other provision of this Note. Nothing contained herein shall be
deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction
to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations,
or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY AND THE HOLDERS EACH HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.


 



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28.          CERTAIN
DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:


 


(a)          “Black
Scholes Consideration Value” means (i) on or after the Initial Quotation Date, the value of the applicable Option or
Convertible Security (as the case may be) as of the date of issuance thereof calculated using the Black Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg utilizing (A) an underlying price per share equal to the Closing
Sale Price of the Ordinary Shares on the Trading Day immediately preceding the public announcement of the execution of definitive
documents with respect to the issuance of such Option or Convertible Security (as the case may be), (B) a risk-free interest rate
corresponding to the U.S. Treasury rate for a period equal to the remaining term of such Option or Convertible Security (as the
case may be) as of the date of issuance of such Option or Convertible Security (as the case may be) and (C) an expected volatility
equal to the greater of 100% and the 100 day volatility obtained from the HVT function on Bloomberg (determined utilizing a 365
day annualization factor) as of the Trading Day immediately following the date of issuance of such Option or Convertible Security
(as the case may be), and (ii) prior to the Initial Quotation Date, the fair market value of the applicable Option or Convertible
Security (as the case may be) as mutually determined by the Company and the Required Holders. If the Company and the Holder are
unable to agree upon the fair market value of the applicable Option or Convertible Security (as the case may be), then such dispute
shall be resolved in accordance with the procedures in Section 24.


 


(b)          “Bloomberg”
means Bloomberg, L.P.


 


(c)          “Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York or London,
England are authorized or required by law to remain closed.


 


(d)          “Closing
Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price (as
the case may be) then the last bid price or last trade price, respectively, of such security prior to 4:00:00 p.m., New York time,
as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security,
the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid
price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such
security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the Closing Bid Price or the Closing
Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the
Closing Sale Price (as the case may be) of such security on such date shall be the fair market value as mutually determined by
the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved in accordance with the procedures in Section 24. All such determinations shall be appropriately
adjusted for any stock dividend, stock split, stock combination or other similar transaction during such period.


 



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(e)          “Closing
Date” shall have the meaning set forth in the Securities Purchase Agreement, which date is the date the Company initially
issued Notes pursuant to the terms of the Securities Purchase Agreement.


 


(f)          “Convertible
Securities” means any stock or other security (other than Options) that is at any time and under any circumstances, directly
or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any
shares of Common Stock.


 


(g)          
“Current Subsidiary” means any Person in which the Company on the Subscription Date, directly or indirectly,
(i) owns any of the outstanding capital stock or holds any equity or similar interest of such Person or (ii) controls or operates
all or any part of the business, operations or administration of such Person, and all of the foregoing, collectively, “Current
Subsidiaries.”


 


(h)          
“Eligible Market” means The New York Stock Exchange, the NYSE Amex, the Nasdaq Global Select Market, the Nasdaq
Global Market, the Nasdaq Capital Market or the Principal Market.


 



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(i)          “Equity
Conditions” means: (i) with respect to the applicable date of determination either (x) one
or more Registration Statements filed pursuant to the Registration Rights Agreement shall be effective and each prospectus contained
therein shall be available for the resale by the Holder of all of the Registrable Securities (which, solely for clarification purposes,
includes all shares of Common Stock issuable upon conversion of this Note, including, without limitation, under Sections
3 and 8) in accordance with the terms of the Registration Rights Agreement and there shall not
have been during such period any Grace Periods (as defined in the Registration Rights Agreement)
or (y) all Registrable Securities shall be eligible for sale without restriction under Rule 144
(as defined in the Securities Purchase Agreement) and without the need for registration under any applicable
federal or state securities laws (in each case, disregarding any limitation on conversion of the Notes and exercise of the the
Warrants); (ii) on each day during the period beginning three months prior to the applicable date of determination and ending
on and including the applicable date of determination (the “Equity Conditions Measuring Period”), the Common
Stock (including all Registrable Securities) is listed or designated for quotation (as applicable)
on an Eligible Market and shall not have been suspended from trading on an Eligible Market (other than suspensions of not more
than two (2) Trading Days and occurring prior to the applicable date of determination due to business announcements by the Company)
nor shall delisting or suspension by an Eligible Market be pending or have been threatened (with a reasonable prospect of delisting
occurring within sixty (60) days of the applicable date of determination) either (A) in writing by such Eligible Market or (B)
by falling below the minimum listing maintenance requirements of the Eligible Market on which the Common Stock is then listed or
designated for quotation (as applicable) (provided, however, that this clause (ii) shall be applicable as of the
Initial Quotation Date and, until the three month anniversary of the Initial Quotation Date, shall be determined without respect
to the three month lookback period in this clause (ii)); (iii) on each day during the Equity Conditions Measuring Period, the Company
shall have delivered all shares of Common Stock issuable upon conversion of this Note on a timely basis as set forth in Section
3 hereof and all other shares of capital stock required to be delivered by the Company on a timely basis as set forth in the other
Transaction Documents; (iv) any shares of Common Stock to be issued in connection with the event requiring determination may be
issued in full without violating Section 3(d) hereof; (v) any shares of Common Stock to be issued in connection with the event
requiring determination may be issued in full without violating the rules or regulations of the Eligible Market on which the Common
Stock is then listed or designated for quotation (as applicable) (provided, however, that this clause (v) shall be
applicable as of the Initial Quotation Date); (vi) on each day during the Equity Conditions Measuring Period, no public announcement
of a pending, proposed or intended Fundamental Transaction shall have occurred which has not been abandoned, terminated or consummated;
(vii) the Company shall have no knowledge of any fact that would reasonably be expected to cause (1)
any Registration Statement filed pursuant to the Registration Rights Agreement to not be effective or any prospectus contained
therein to not be available for the resale of all of the Registrable Securities in accordance with the terms of the Registration
Rights Agreement or (2) any Registrable Securities to not be eligible for sale without restriction pursuant to Rule 144 or any
applicable state securities laws (in each case, disregarding any limitation on conversion of the Notes and exercise of the Warrants);
(viii) on and after the Self Filing Effective Date, the Holder shall not be in (and no other Buyer shall be in) possession of any
material, non-public information which has been provided to any of them by the Company, any of its affiliates or any of their respective
employees, officers, representatives, agents or the like; (ix) on each day during the Equity Conditions Measuring Period,
the Company otherwise shall have been in compliance with each, and shall not have breached any, material provision, covenant, representation
or warranty of any Transaction Document; and (x) on each day during the Equity Conditions Measuring Period, there shall not have
occurred an Event of Default or an event that with the passage of time or giving of notice would constitute an Event of Default.


 


(j)          “Equity
Conditions Failure” means, with respect to a particular date of determination, that on any day during the period commencing
twenty (20) Trading Days immediately prior to such date of determination, the Equity Conditions have not been satisfied (or waived
in writing by the Holder).


 


(k)          “Equity
Value Redemption Premium” means 110%.


 



    	31



    	 



    

 


(l)          
“Fundamental Transaction” means that (i) the Company or any of its Subsidiaries shall, directly or indirectly,
in one or more related transactions, (1) consolidate or merge with or into (whether or not the Company or any of its Subsidiaries
is the surviving corporation) any other Person, or (2) sell, lease, license, assign, transfer, convey or otherwise dispose of all
or substantially all of its respective properties or assets to any other Person, or (3) allow any other Person to make a purchase,
tender or exchange offer that is accepted by the holders of more than 50% of the outstanding shares of Voting Stock of the Company
(not including any shares of Voting Stock of the Company held by the Person or Persons making or party to, or associated or affiliated
with the Persons making or party to, such purchase, tender or exchange offer), or (4) consummate a stock or share purchase agreement
or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement)
with any other Person whereby such other Person acquires more than 50% of the outstanding shares of Voting Stock of the Company
(not including any shares of Voting Stock of the Company held by the other Person or other Persons making or party to, or associated
or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination),
or (5) reorganize, recapitalize or reclassify the Common Stock, or (ii) any “person” or “group” (as these
terms are used for purposes of Sections 13(d) and 14(d) of the 1934 Act and the rules and regulations promulgated thereunder) is
or shall become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of 50%
of the aggregate ordinary voting power represented by issued and outstanding Voting Stock of the Company. Notwithstanding anything
to the contrary herein, each of a Permitted Private Placement and a Permitted Ophthalmology Transaction shall not be deemed to
be a “Fundamental Transaction”.


 


(m)          “Fundamental
Transaction Redemption Premium” means 100%.


 


(n)          
“IFRS” means International Financial Reporting Standards as used in Israel, consistently applied.


 


(o)          “Interest
Rate” means zero percent (0%) per annum, as may be adjusted from time to time in accordance with Section 2.


 


(p)          “Maturity
Date” shall mean December __, 2012; provided, however, that the Maturity Date may be extended at the
option of the Holder (i) in the event that, and for so long as, an Event of Default shall have occurred and be continuing or any
event shall have occurred and be continuing that with the passage of time and the failure to cure would result in an Event of Default
or (ii) through the date that is twenty (20) Business Days after the consummation of a Fundamental Transaction in the event that
a Fundamental Transaction is publicly announced or a Fundamental Transaction Notice is delivered prior to the Maturity Date; provided
further, however, that if a Holder elects to convert some or all of this Note pursuant to Section 3 hereof, and the
Conversion Amount would be limited pursuant to Section 3(d) hereunder, the Maturity Date shall automatically be extended until
such time as such provision shall not limit the conversion of this Note.


 


(q)          “New
Subsidiary” means, as of any date of determination, any Person in which the Company after the Subscription Date, directly
or indirectly, (i) owns or acquires any of the outstanding capital stock or holds any equity or similar interest of such Person
or (ii) controls or operates all or any part of the business, operations or administration of such Person, and all of the foregoing,
collectively, “New Subsidiaries.”


 


(r)          “Options”
means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.


 



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(s)          “Ordinary
Shares” means (i) the Company’s ordinary shares, £0.01 par value per share, and (ii) any capital stock
into which such ordinary shares shall have been changed or any share capital resulting from a reclassification of such ordinary
shares.


 


(t)          “Parent
Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock
or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity,
the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.


 


(u)          “Permitted
Indebtedness” means (i) any Existing Senior Indebtedness, (ii) Indebtedness evidenced by this Note and the Other Notes,
and subsidiary guarantees in respect thereof, and (iii) any Indebtedness that is subordinated to the Notes pursuant to a subordination
agreement which is satisfactory to the Holders in their sole discretion, the terms and conditions of which are not more favorable
than the terms and conditions as set forth in the Transaction Documents, including, if such subordinated Indebtedness is convertible
into Ordinary Shares, having an effective price per share that is not less than $____3 (subject to adjustment for forward
and reverse stock splits, stock dividends, recapitalizations and the like) and which matures more than 91 days following the Maturity
Date.


 


(v)          “Permitted
Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings
for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary course
of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation
of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business
with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings,
(iv) Liens securing the Company’s obligations under the Transaction Documents, and (v) Liens securing each Subsidiary’s
obligations under the Transaction Documents (including, without limitation, under the Guaranties).


 


(w)          “Permitted
Ophthalmology Transaction” shall mean any sale, lease, sub-license, transfer, conveyance or other disposal of any assets
or rights of the Company or any Subsidiary (including the securities of any Subsidiary) owned or hereafter acquired, whether in
a single transaction or a series of related transactions, related to or in the field of ophthalmology to an unaffiliated third
party.


 


(x)          “Person”
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization,
any other entity or a government or any department or agency thereof.


 


(y)          “Principal
Market” means the Over-the-Counter Bulletin Board of the Financial Industry Regulatory Authority, Inc.


 





 



3 Conversion
Price


 



    	33



    	 



    

 


(z)          
“Quarter” means each of: (i) the period beginning on and including January 1 and ending on and including March
31; (ii) the period beginning on and including April 1 and ending on and including June 30; (iii) the period beginning on and including
July 1 and ending on and including September 30; and (iv) the period beginning on and including October 1 and ending on and including
December 31.


 


(aa)          “Redemption
Notices” means, collectively, Event of Default Redemption Notices, Fundamental Transaction Redemption Notices, and Permitted
Private Placement Redemption Notices and each of the foregoing, individually, a “Redemption Notice.”


 


(bb)          “Redemption
Premium” means (i) in the case of the Events of Default described in Section 4(a) (other than Sections 4(a)(ix) through
4(a)(xi), inclusive), 110% or (ii) in the case of the Events of Default described in Sections 4(a)(ix) through 4(a)(xi), inclusive,
100%.


 


(cc)          “Redemption
Prices” means, collectively, Event of Default Redemption Prices, the Fundamental Transaction Redemption Prices, and the
Permitted Private Placement Redemption Prices and each of the foregoing, individually, a “Redemption Price.”


 


(dd)          “Registration
Rights Agreement” means that certain registration rights agreement, dated as of the Closing Date, by and among the Company
and the initial holders of the Notes relating to, among other things, the registration of the resale of the Ordinary Shares issuable
upon conversion of the Notes and exercise of the Warrants, as may be amended from time to time.


 


(ee)          “Required
Holders” means each of the following: (i) Holders, in the aggregate, holding at least a majority of the then-outstanding
Principal amount of the Notes and (ii) Iroquois (as defined in the Securities Purchase Agreement).


 


(ff)          “SEC”
means the United States Securities and Exchange Commission or the successor thereto.


 


(gg)          “Securities
Purchase Agreement” means that certain securities purchase agreement, dated as of the Subscription Date, by and among
the Company and the initial holders of the Notes, as may be amended from time to time.


 


(hh)          
“Security Agreement” means that certain security agreement, dated as of the Subscription Date, by and among
the Company, its Subsidiaries and the initial holders of the Notes, as may be amended from time to time.


 


(ii)          “Subscription
Date” means March __, 2012.


 


(jj)          “Subsidiaries”
means, as of any date of determination, collectively, all Current Subsidiaries and all New Subsidiaries, and each of the foregoing,
individually, a “Subsidiary.”


 


(kk)          “Successor
Entity” means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting from or surviving
any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental Transaction
shall have been entered into.


 



    	34



    	 



    

 


(ll)          “Trading
Day” means, as applicable, (x) with respect to all price determinations relating to the Ordinary Shares, (A) on and after
the Initial Quotation Date, any day on which the Ordinary Shares are traded on the Principal Market, or, if the Principal Market
is not the principal trading market for the Ordinary Shares, then on the principal securities exchange or securities market on
which the Ordinary Shares are then traded, provided that “Trading Day” shall not include any day on which the Ordinary
Shares are scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Ordinary Shares are suspended
from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance
the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time) unless such
day is otherwise designated as a Trading Day in writing by the Holder, and (B) prior to the Initial Quotation Date, any day on
which The New York Stock Exchange (or any successor thereto) is open for trading of securities, or (y) with respect to all determinations
other than price determinations relating to the Ordinary Shares, any day on which The New York Stock Exchange (or any successor
thereto) is open for trading of securities.


 


(mm)          
“Voting Stock” of a Person means capital stock of such Person of the class or classes pursuant to which the
holders thereof have the general voting power to elect, or the general power to appoint, at least a majority of the board of directors,
managers, trustees or other similar governing body of such Person (irrespective of whether or not at the time capital stock of
any other class or classes shall have or might have voting power by reason of the happening of any contingency).


 


(nn)          “VWAP”
means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or,
if the Principal Market is not the principal trading market for such security, then on the principal securities exchange or securities
market on which such security is then traded) during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00
p.m., New York time, as reported by Bloomberg through its “Volume at Price” function or, if the foregoing does not
apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board
for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported
by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average
of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported in
the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the VWAP cannot be calculated for such security
on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value as mutually determined
by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved in accordance with the procedures in Section 24. All such determinations shall be appropriately
adjusted for any stock dividend, stock split, stock combination or other similar transaction during such period.


 



    	35



    	 



    

 


(oo)          “Warrants”
has the meaning ascribed to such term in the Securities Purchase Agreement, as may be amended from time to time, and shall include
all warrants issued in exchange therefor or replacement thereof.


 


29.          DISCLOSURE.
On and after the Self Filing Effective Date, upon receipt or delivery by the Company of any notice in accordance with the terms
of this Note, unless the Company has in good faith determined that the matters relating to such notice do not constitute material,
non-public information relating to the Company or any of its Subsidiaries, the Company shall simultaneously with any such receipt
or delivery publicly disclose such material, non-public information on a Report of Foreign Private Issuer on Form 6-K or otherwise.
On and after the Self Filing Effective Date, in the event that the Company believes that a notice contains material, non-public
information relating to the Company or any of its Subsidiaries, the Company so shall indicate to such Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters
relating to such notice do not constitute material, non-public information relating to the Company or its Subsidiaries. Nothing
contained in this Section 30 shall limit any obligations of the Company, or any rights of the Holder, under Section 5(i) of the
Securities Purchase Agreement.


 


30.          MAXIMUM
PAYMENTS. Without limiting Section 10(d) of the Securities Purchase Agreement, nothing contained in this Note shall, or shall
be deemed to, establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable
law. In the event that the rate of interest required to be paid or other charges under this Note exceeds the maximum permitted
by such law, any payments in excess of such maximum shall be credited against amounts owed by the Company to the Holder and thus
refunded to the Company.


 


[signature page follows]


 



    	36



    	 



    

 


IN WITNESS WHEREOF,
the Company has caused this Note to be duly executed as of the Issuance Date set out above.


 


	 	MORRIA BIOPHARMACEUTICALS PLC
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:


 



    	 



    	 



    

 


EXHIBIT I



MORRIA BIOPHARMACEUTICALS PLC

CONVERSION NOTICE


 


Reference is made to
the Original Issue Discount Senior Secured Convertible Note (the “Note”) issued to the undersigned by Morria
Biopharmaceuticals PLC, a public limited company formed under the laws of England and Wales (the “Company”).
In accordance with and pursuant to the Note, the undersigned hereby elects to convert the Conversion Amount (as defined in the
Note) of the Note indicated below into ordinary shares, £0.01 par value per share (the “Ordinary Shares”),
of the Company, as of the date specified below.


 


	Date of Conversion:	 


 


	Aggregate Conversion Amount to be converted:	 


 


	Conversion Price:	 


 


	Number of shares of Ordinary Shares to be issued:	 


 


Please issue the Ordinary Shares into which
the Note is being converted in the following name and to the following address:


 


	Issue to:	 
	 	 
	 	 
	 	 
	 	 


 


	Facsimile Number:	 


 


	Holder:	 


 


	By:	 


 


	Title:	 


 





 


	Dated:	 





 


	Account Number:	 





(if electronic book entry transfer)


 







	Transaction Code Number:	 


 (if electronic book entry transfer)







 








    	 



    	 



    

 


EXHIBIT II


 


ACKNOWLEDGMENT


 


The Company hereby
acknowledges this Conversion Notice and [If prior to the Initial Quotation Date – hereby acknowledges its obligation
to issue the above indicated number of Ordinary Shares to the Holder] [If on or after the Initial Quotation Date –
hereby directs _________________ to issue the above indicated number of Ordinary Shares in accordance with the Transfer Agent Instructions
dated _____________, 20__ from the Company and acknowledged and agreed to by ________________________].


 


	 	MORRIA BIOPHARMACEUTICALS PLC
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title: