SECURITY AGREEMENT


         SECURITY  AGREEMENT  (the "Security  Agreement")  dated as of April 30,
1998  between  HUNTINGDON  LIFE  SCIENCES  INC.,  a  Delaware  corporation  (the
"Company"), and NATIONAL WESTMINSTER BANK PLC (the "Agent"), as collateral agent
for (i) the banks  parties to the  Facilities  Agreement  referred to below (the
"Facility  Banks") and (ii)  itself,  as  Overdraft  Bank under the New Facility
Letter referred to below (in such capacity, the "Overdraft Bank").

                              W I T N E S S E T H:


         WHEREAS, the Company, Huntingdon Life Sciences Limited, Huntington Life
Sciences  Group  plc,  the  Facility  Banks and the Agent  have  entered  into a
Facilities  Agreement,  dated as of  November  1,  1995 (as  amended,  modified,
supplemented or extended from time to time, the "Facilities Agreement") pursuant
to which the Facility Banks have agreed to make certain facilities  available to
the Company, Huntingdon Life Sciences Limited and Huntington Life Sciences Group
plc; 

         WHEREAS,  in  connection  with the  Facilities  Agreement,  the Company
executed and delivered (i) a Guarantee dated as of November 1, 1995 (as amended,
modified,  supplemented or extended from time to time, the "Guarantee") in favor
of the Agent for the benefit of the Facility Banks and (ii) a Mortgage, Security
Agreement and Fixture Filing dated as of January 20, 1998 (as amended, modified,
supplemented  and extended from time to time,  the  "Mortgage")  in favor of the
Agent for the benefit of the Facility Banks; and

         WHEREAS,  pursuant to a New Facility  Letter dated as of March 17, 1998
(as amended,  modified,  supplemented  and extended from time to time,  the "New
Facility  Letter")  from the  Agent,  as  Overdraft  Bank in  respect of the new
overdraft  facility provided for therein,  the Company has agreed to execute and
deliver this Security  Agreement to secure its obligations  under the Facilities
Agreement, the Guarantee and the New Facility Letter;

         NOW, THEREFORE,  in consideration of the foregoing,  the Company hereby
agrees with the Agent,  for the benefit of the Facility  Banks and the Overdraft
Bank (the Agent,  the Facility  Banks and the  Overdraft  Bank are  collectively
referred to herein as the "Secured Parties"), as follows:

         SECTION 1. Definitions.  Unless otherwise  indicated,  capitalized
terms used herein and not defined herein shall have the respective meanings
given to them in the Facilities Agreement.

         SECTION 2. Grant of  Security.  The Company  hereby  assigns,  pledges,
transfers  and grants to the Agent,  for the benefit of the Secured  Parties,  a
continuing  security  interest in, and a lien upon, all of the Company's  right,
title and interest in, to and under, the following:

         (a) The Company's  demand deposit  account  (account  number 191 10015)
with The First National Bank of Maryland (the "Pledged  Account") and all monies
and credit balances from time to time held in the Pledged Account;

         (b) The equipment and property described on Exhibit A hereto,  together
with all replacements and subsequent  replacements  thereof  (collectively,  the
"Equipment"); and

         (c) Any and all proceeds of any of the foregoing.

         The property  referred to and described in (a), (b) and (c) of this
Section 2 is hereinafter  collectively  referred to as the "Collateral".
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         SECTION 3. Security for Obligations.  This Security  Agreement  secures
the payment of all obligations and liabilities now or hereafter  existing of (i)
the Company, Huntingdon Life Sciences Limited and Huntingdon Life Sciences Group
plc to the Agent and the Facility Banks under the  Facilities  Agreement and the
related  documents  referred to  therein,  (ii) the Company to the Agent and the
Facilities  Banks under the Guarantee,  and (iii) the Company,  Huntingdon  Life
Sciences  Limited and Huntingdon  Life Sciences Group plc under the New Facility
Letter and (iv) all other  liabilities and obligations of whatever nature of the
Company,  Huntingdon Life Sciences Limited and/or Huntingdon Life Sciences Group
plc now or  hereafter  owed to any one or  more  of the  Secured  Parties,  such
obligations and  liabilities set forth in clauses (i), (ii),  (iii) and (iv) are
collectively referred to herein as the "Secured Obligations").

         SECTION 4.   Covenants.

         (a) The  Company  agrees  that from  time to time,  at its own cost and
expense,  the  Company  will  promptly  execute and deliver and will cause to be
executed and delivered all further instruments and documents, including, without
limitation,  financing and  continuation  statements,  and will take all further
action  and will  cause  all  further  action  to be  taken,  that the Agent may
reasonably  request  in order to  create,  preserve,  perfect  and  protect  the
security  interest  in the  Collateral  or to enable the Agent to  exercise  and
enforce its rights and remedies  hereunder  or to preserve,  perfect and protect
the Company's right, title and interest in and to the Collateral.

         (b) The  Company  hereby  authorizes  the  Agent  to  file  one or more
financing or continuation statements,  and amendments thereto, and take all such
further action and execute all such further  documents and instruments as may be
necessary  or desirable  in order to create,  preserve,  perfect and protect the
security  interest in the Collateral  without the signature of the Company where
permitted by law.

         (c) The Company will at all times keep accurate and complete  books and
records  with  respect  to the  Collateral  and  agrees  that  the  Agent or its
representative  shall  have the  right at any time and from  time to time,  upon
reasonable  advance  notice,  to call at the Company's  place of business during
normal  business  hours to  inspect  and  examine  the books and  records of the
Company  relating to the  Collateral  and to make extracts  therefrom and copies
thereof.

         (d) The Company  hereby  covenants with the Agent and each of the other
Secured  Parties that it will pay and discharge each of the Secured  Obligations
owed by the Company when due to the Agent and the other Secured Parties.

         (e) A  certificate  signed by an officer of the Agent or other  Secured
Party (as the case may be) as to the money and  liabilities  for the time  being
due or incurred to the Agent or any other Secured  Party,  as shown on the books
and records of the Agent or such Secured Party, from or by the Company shall for
all purposes (in the absence of manifest error) be conclusive  evidence  against
and binding on the Company.

         (f) The  Company  hereby  covenants  that,  without  the prior  written
consent of the Agent, it shall not nor shall it agree to purport to:

                  (i) create or permit to exist any lien,  security  interest or
encumbrance,  whether in any such case ranking in priority to or pari passu with
or after the security interest created by this Security Agreement over the whole
or any part of the  Collateral,  other  than  liens in  favor  of  mechanics  or
materialsmen  or for taxes not yet due and payable or which are being  contested
in good  faith by  appropriate  proceedings  and for  which  reserves  have been
established in accordance with generally accepted accounting principles; or

                  (ii)  sell,  assign,  transfer,  lease,  sub-lease,  hire,  or
otherwise  dispose  of,  whether  by means of one or a  number  of  transactions
related or not and  whether  at one time or over a period of time,  the whole or
any part of the Collateral or any interest therein; or

                  (iii) do or  permit  to be done any act or thing  which  might
jeopardize  the rights of the Agent in the  Collateral  or any part  thereof and
will not omit or allow the omission of any act which might prevent the rights of
the  Agent in the  Collateral  or any part  thereof  from  being  exercised.  In
particular,  the  Company  covenants  that it shall  obtain  and effect and keep
effective  all permits,  licenses and  approvals  which may from time to time be
required in connection with the Collateral.

         (g) The Company  covenants and agrees with the Agent that, at all times
during the  subsistence of the security  interest  constituted by or pursuant to
this Security  Agreement,  the Company will (at its own cost and expense)  cause
the Equipment to be insured and to be kept insured with such  insurers,  in such
amounts and on such terms as maintained by similarly  situated  companies  using
similar items of Equipment in the conduct of their business, but in any event in
an amount not less than the full replacement value thereof.

         (h) The  Company  further  covenants  and agrees  with the Agent  that,
during the continuance of this Security Agreement, the Company shall:

         (i)  fully  and  promptly   comply  with  all  the  terms,   covenants,
undertakings and conditions of each policy of insurance  relating to any part of
the  Equipment and will not do,  consent,  agree to, suffer or permit any act or
omission which may  invalidate  any policy of insurance  relating to any part of
the Equipment or render the same unenforceable in whole or in part;

         (ii) ensure that the Agent is included  (A) on each policy of liability
insurance relating to any part of the Equipment as an additional insured with no
operational  interests in the Equipment  with the effect that the  provisions of
each policy of insurance,  except the limits on  liability,  shall operate as if
there were a separate  policy  with and  covering  each  insured and so that the
insurance  provided for the Agent under the policy is not invalidated by any act
or omission on the part of the Company or its servants or agents and (B) on each
policy of property damage  insurance  relating to any part of the Equipment as a
loss payee;

         (iii)  ensure that all  insurance  contains a clause to the effect that
the policy may not be  terminated,  cancelled or  materially  altered  unless at
least  30  days  prior  notice  of the  intended  termination,  cancellation  or
alteration has been given to the Agent;

         (iv)  hold all  slips,  cover  notes  and  contracts  and  policies  of
insurance  relating to the Equipment to the order of the Agent and shall, on the
request of the Agent, deliver the originals or copies thereof to the Agent;

         (v) duly and  punctually  pay all  premiums  and other  moneys  due and
payable  under all such  insurance as aforesaid and promptly upon request by the
Agent  provide to the Agent the premium  receipts  or other  evidence of payment
thereof; and

         (vi) not terminate or cancel any insurance  without the prior  delivery
to the Agent of evidence of such  replacement  insurance  coverage in respect of
the Equipment satisfying the requirements set forth herein.

         (i) If the Company fails to obtain and maintain  insurance  coverage in
accordance  with the  provisions  hereof,  the Agent shall be entitled,  but not
bound,  to do so either  in its own name or in its name and that of the  Company
jointly  or in the  name of the  Company  with  an  endorsement  of the  Agent's
interest.  All amounts  expended by the Agent on so obtaining or maintaining any
such  insurance  shall be  reimbursed  by the Company to the Agent on demand and
shall carry interest at the Facility Rate from the date such amounts are paid by
the Agent to but not  including  the date such amounts are repaid in full by the
Company.

         (j) All  claims  and  moneys  received  or  receivable  under  any such
insurance  coverage as  aforesaid  shall at the option of the Company be applied
either in making  good the loss or damage in  respect of which the same has been
received or in or towards the discharge of the Secured  Obligations prior to the
occurrence of an Event of Default (as defined  below).  Upon the  occurrence and
during the  continuation of an Event of Default,  all claims and moneys received
or receivable  under such  insurance  coverage  shall be applied by the Agent in
discharge of the Secured Obligations.

         (k) The Company hereby covenants with the Agent that until discharge of
the security interest hereby created:

         (i) the Company shall,  at its own expense,  keep the Equipment and all
parts of the same in good operational repair and condition in all respects,  and
to that end (but without  limiting the generality of the foregoing)  shall carry
out all  necessary  maintenance,  overhauls,  replacements  and  repairs  to the
Equipment and all such parts;

         (ii) the Company shall, at its own expense,  comply with all provisions
having  the force of law  affecting  the  Equipment  or any of them or any parts
thereof and shall  maintain the same in such  condition so as to comply with all
laws and  regulations  of any  jurisdiction  in which  any of the  Equipment  is
operated or to which any of the Equipment is subject;

         (iii) the Company shall not knowingly  employ or suffer the  employment
of any of the Equipment for any illegal or unlawful purpose;

         (iv) the Company shall do all acts and things the Agent may  reasonably
require to protect the Agent's  interest in the Equipment  against the claims of
any other person.

         (l) The Company shall indemnify and keep the Agent indemnified  against
and on demand reimburse the Agent for:

         (i)  all reasonable costs and expenses of operating,  insuring,
maintaining and repairing the Equipment actually incurred by the Agent;

         (ii) all damages,  liabilities,  claims,  reasonable costs and expenses
whatsoever  (including financial or consequential loss) which may at any time be
made  or  claimed  by  the  Company  or  by  an  employee,   servant,  agent  or
sub-contractor  of the  Company  or by any third  party or  parties  or by their
respective  dependants  arising  directly or indirectly  out of the  possession,
management, storage, operation, control, use, leasing, maintenance and/or repair
of any of the Equipment; and

         (iii) all losses, damages or expenses which, consequent upon a judgment
being  obtained or enforced in respect of the  non-payment by the Company of any
amount  secured by this Security  Agreement,  arise or result from any variation
between  the  date of the  said  amount  becoming  due (or the  date of the said
judgment  being  obtained  as the case may be) and the  date of  actual  payment
thereof in the rates of exchange  between the  currency in which such amount was
due and the currency in which such  judgment  was  obtained  and this  indemnity
granted   from  time  to  time   shall   continue   in  full  force  and  effect
notwithstanding any judgment in favor of the Agent.

         (m) The Company shall pay to the Agent on demand all moneys  whatsoever
which the Agent  shall  expend,  be put to or become  liable for in or about the
protection  or  maintenance  of the security  interest  created by this Security
Agreement,  or in or about  the  exercise  of its  powers  hereunder  and  shall
indemnify the Agent against all existing and future taxes, rates,  duties, fees,
charges,  assessments,  impositions and outgoings whatsoever (whether imposed by
deed or statute or otherwise and whether in the nature of capital or revenue and
even  though of a wholly  novel  character)  which now or at any time during the
continuance of the security interest constituted by or pursuant to this Security
Agreement are properly payable in respect of the Collateral or any part thereof.

         (n) If any such sums as are  referred to in Section  4(m) shall be paid
by the Agent, the same shall be reimbursed by the Company to the Agent on demand
and shall bear interest at the Facility Rate from the date such amounts are paid
by the Agent to but not  including  the date such  amounts are repaid in full by
the Company.

         (o) With  respect to any amount  that the Company is required to pay by
reason of any provision hereunder, including, without limitation, Sections 4(i),
(l), (m) and (n), the Agent shall submit to the Company  relevant  documentation
to substantiate the requested payment.
         (p) Notwithstanding  anything herein to the contrary, the Company shall
not be liable for any  amounts  set forth in  Sections  4(l)  through (n) hereof
which result from the gross negligence or wilful misconduct of the Agent.

         (q) The Company  agrees that until  discharge of the Security  Interest
created herein, the Company shall not establish or maintain any deposit accounts
other than the Pledged Account. The Company further covenants and agrees that it
shall cause all  receivables,  payments or proceeds  from the  operation  of the
Company's  business  of any kind  whatsoever  to be paid  directly  to, or to be
deposited  into,  the Pledged  Account.  Prior to the  occurrence of an Event of
Default  (as  defined  below),  the  Company  shall  have the  right  to  direct
withdrawals and disbursements from the Pledged Account in the ordinary course of
its business,  as set forth in the account  letter among the Company,  the Agent
and The First National Bank of Maryland,  a copy of which is attached  hereto as
Exhibit B. For so long as no Event of Default has  occurred,  the Company  shall
have the right to direct the  investment of funds in the Pledged  Account in the
following investments (collectively,  "Permitted Investments") having a maturity
of 90 days or less, as determined by the Company:  (i) direct obligations of the
United States and (ii) interest-bearing  obligations of any domestic bank having
a short-term  credit  rating of at least A-1 by Standard and Poors Ratings Group
and at least P-1 by Moody's Investors Service,  Inc.;  provided that the Company
may make such  investments  only if the investment  certificates are held in the
Pledged Account.

         SECTION 5.   Representations and Warranties.

         (a) This Security  Agreement has been duly  authorized by all necessary
action of the Company, and validly and duly executed and delivered to the Agent.
This Security  Agreement  constitutes the legal, valid and binding obligation of
the Company, enforceable against the Company in accordance with its terms.

         (b) All of the  Equipment  is,  and each  replacement  or  substitution
thereof and any and all proceeds thereof will be, located at the Company's place
of business and chief executive  office at Mettlers Road,  East  Millstone,  New
Jersey 08875-2360.

         (c) The Company is the legal and  beneficial  owner of each item of the
Collateral,  free and clear of any lien or encumbrance,  except for the security
interest created under this Security Agreement. No effective financing statement
or other similar  instrument  covering any part of the  Collateral is on file in
any  recording  office,  except  as may have been  filed in favor of the  Agent,
relating to this Security Agreement.

         (d) The Company has possession and exclusive control of the Equipment.

         (e) The Company has no deposit  accounts other than the Pledged Account
and the accounts set forth on Exhibit B.

         (f) Upon  filing of UCC-1  forms  appropriately  completed  in Somerset
County,  New  Jersey,  all  filings and other  action  necessary  to perfect the
security  interest  over the  Equipment  shall have been  taken.  This  Security
Agreement  creates a valid,  perfected first priority  security  interest in the
Collateral securing the payment of the Secured Obligations.

         SECTION  6.  Agent  Appointed  Attorney-in-Fact.   The  Company  hereby
irrevocably  appoints  the  Agent  the  Company's  attorney-in-fact,  with  full
authority  in the place and stead of the  Company and in the name of the Company
or otherwise, from time to time after the occurrence and during the continuation
of an event of default as defined  in the  Facilities  Agreement  or an event of
default as defined in the New  Facility  Letter or any failure by the Company to
keep or perform any covenant or undertaking hereunder which failure shall remain
uncured for three days after the Company's receipt of a notice thereof (each, an
"Event of  Default"),  to take any  action,  to execute any  instruments  and to
exercise  any rights,  privileges,  options,  elections or powers of the Company
pertaining or relating to the  Collateral  which the Agent may deem necessary or
desirable to preserve and enforce its security  interest in the  Collateral  and
otherwise to accomplish the purposes of this Security Agreement. The Agent shall
not have any duty to take any such action,  to execute any such  instrument,  to
exercise any such rights, privileges,  options,  including,  without limitation,
termination options, elections or powers or to sell or otherwise to realize upon
any of the  Collateral,  as hereinafter  authorized,  and the Agent shall not be
responsible for any failure to do so or delay in so doing.

         SECTION 7.  Agent May  Perform.  If the  Company  fails to perform  any
agreement contained herein, the Agent may (but shall not be obligated to) itself
perform,  or cause  performance of, such agreement.  The Company shall reimburse
the Agent on demand for any amounts paid or any  expenses  incurred by the Agent
in good faith in connection therewith,  and shall carry interest at the Facility
Rate from the date such amounts are paid by the Agent to but not  including  the
date on which such amounts are repaid in full by the Company.

         SECTION 8. Agent's Duties.  The powers conferred on the Agent hereunder
are solely to protect  its  interest  in the  Collateral  for the benefit of the
Secured  Parties  and shall not  impose  any duty upon it to  exercise  any such
powers.  Except as expressly  provided  herein,  the Agent shall have no duty to
take any steps to preserve the security interest granted hereby.

         SECTION 9. Realization  upon  Collateral.  If an Event of Default shall
occur and be  continuing,  the Agent  may,  and at the  request  of the  Secured
Parties  shall,  for the  benefit of the Secured  Parties,  (i) take any and all
action  necessary or appropriate to collect any and all amounts payable under or
with  respect to the  Collateral,  (ii) apply any and all amounts in the Pledged
Account to the Secured  Obligations in accordance  with Section 9 hereof,  (iii)
take possession of the Collateral forthwith or at any time thereafter,  in which
case the Company shall  marshal and deliver the  Collateral to the Agent at such
time and place as the Agent may reasonably specify,  and (iv) sell the whole or,
from time to time,  any part of the  Collateral,  by private or public sale,  in
such order or otherwise in such manner as the Secured Parties may elect in their
sole  discretion.  The Agent  shall have,  with  respect to the  Collateral,  in
addition to any other rights and remedies which may be available to it at law or
in equity or  pursuant  to this  Security  Agreement  or any other  contract  or
agreement,  all rights and  remedies  of a secured  party  under any  applicable
version of the Uniform Commercial Code of the relevant jurisdictions relating to
the Collateral,  and it is expressly  agreed that if the Agent should proceed to
dispose of or utilize the  Collateral,  or any part thereof,  in accordance with
the provisions of said versions of the Uniform Commercial Code, ten days' notice
by the Agent to the Company  shall be deemed to be  reasonable  notice under any
such provision requiring such notice. Any sale of Collateral by the Agent may be
made on such terms as the Secured  Parties may  specify,  without  assuming  any
credit risk and without any  obligation  to advertise or give notice of any kind
other  than that  necessary  under  applicable  law.  The Agent and the  Secured
Parties shall incur no liability as a result of the sale of the  Collateral,  or
any part thereof,  at any private or public sale. The Company hereby waives,  to
the extent  permitted by  applicable  law, any claims  against the Agent and the
Secured Parties arising by reason of the fact that the price at which Collateral
may have been sold at such a private  sale was less than the price  which  might
have been obtained at a public sale or was less than the aggregate amount of the
Secured Obligations, even if the Agent accepts the first offer received and does
not offer such Collateral to more than one possible purchaser. In exercising its
rights  under this  Section 9, the Agent will act in a  commercially  reasonable
manner.

         SECTION 10. Application of Proceeds. The Agent shall apply the proceeds
of any realization upon or sale of the whole or any part of the Collateral after
deducting all reasonable costs and expenses of collection,  retaking,  handling,
storage,  preparation,   sale  and  delivery  (including,   without  limitation,
reasonable  counsel's fees and expenses)  incurred by it in connection with such
realization  or sale to the payment of the Secured  Obligations.  Any surplus of
such payments or cash proceeds held by the Agent and remaining  after payment in
full of all the Secured  Obligations shall be paid over to the Company,  and the
Company shall remain in all respects liable to the Agent, the Facility Banks and
the Overdraft Bank for any unrecovered balance owing to them.

         SECTION  11.  Waiver of Stays,  etc.  To the  fullest  extent  that the
Company may lawfully so agree,  the Company  agrees that it will not at any time
plead,  claim  or  take  the  benefit  of  any  appraisement,  valuation,  stay,
extension,  moratorium or redemption law now or hereafter in force to prevent or
delay the  enforcement  of this  Security  Agreement or the absolute sale of any
portion of or all of the Collateral or the  possession  thereof by any purchaser
at any sale under this Security Agreement,  and the Company,  for itself and all
who may claim under the Company, as far as the Company now or hereafter lawfully
may do so, hereby waives the benefit of all such laws.

          SECTION 12.  Amendments,  etc. No amendment,  modification  or
waiver of any provision of this Security Agreement, nor consent to any departure
by the Company therefrom,  shall in any event be effective unless the same shall
be in writing and signed by the Agent with the  consent of the  Secured  Parties
(or all of the Facility Banks, to the extent required pursuant to the Facilities
Agreement),  and then such  waiver or  consent  shall be  effective  only in the
specific instance and for the specific purpose for which given.

         SECTION 13. Notices.  Unless otherwise  specified herein,  all notices,
requests and other  communications  to any party  hereunder  shall be in writing
(including  telex,  telecopier  or similar  writing)  and shall be given to such
party at its address or telex or telecopier  number set forth in the  Facilities
Agreement or such other address or telex or telecopier  number as such party may
hereafter specify by notice to the other party.

         SECTION 14. Continuing Security Interest. This Security Agreement shall
create a continuing  security interest in the Collateral and shall (a) remain in
full force and effect until the later of (i) the  termination of the commitments
under the Facilities Agreement and the commitments under the New Facility Letter
or  (ii)  the   payment  in  full  of  the  Secured   Obligations   (other  than
indemnification  obligations  as to which a claim has not been  asserted at this
time),  (b) be binding upon the Company and its  successors  and assigns and (c)
inure to the  benefit  of the  Agent,  each of the  Secured  Parties  and  their
respective  successors,  transferees  and  assigns.  Upon  the  later of (i) the
termination  of  the  commitments   under  the  Facilities   Agreement  and  the
commitments  under the New  Facility  Letter or (ii) the  payment in full of the
Secured Obligations (other than indemnification  obligations as to which a claim
has not been asserted at such time), the security  interest granted hereby shall
terminate and all rights to the Collateral shall revert to the Company. Upon any
such termination and the payment in full of the Secured  Obligations (other than
indemnification  obligations  as to which a claim has not been  asserted at such
time), the Agent will, at the expense of the Company, execute and deliver to the
Company such documents as the Company shall reasonably  request to evidence such
termination.

         SECTION 15. No Waiver;  Cumulative Remedies.  No failure on the part of
the Agent to exercise,  and no delay in exercising,  any right,  power or remedy
hereunder  shall  operate as a waiver  thereof,  nor shall any single or partial
exercise of any such right,  power or remedy by the Agent  preclude any other or
further  exercise  thereof or the exercise of any other right,  power or remedy.
All rights,  powers and remedies  hereunder are cumulative and are not exclusive
of any other rights, powers and remedies provided by law.

         SECTION 16.   Responsibility of the Agent.

         (a) By  accepting  the  benefits  hereof,  each  Secured  Party  hereby
irrevocably designates and appoints,  subject to Section 16(e) hereof, the Agent
as Agent under this Security Agreement,  to take such action on its behalf under
the  provisions  of this  Security  Agreement  and to  exercise  such powers and
perform  such duties as are  expressly  delegated  to such Agent by the terms of
this  Security  Agreement,  together  with such other  powers as are  reasonably
incidental thereto.

         (b) By accepting  the benefits  hereof,  each Secured Party agrees that
(i) neither the Agent, nor any of its directors, officers or employees or agents
shall be liable for any action  taken or omitted to be taken by them  hereunder,
except  for their own gross  negligence  or willful  misconduct,  (ii) the Agent
shall not be responsible to the Secured Parties for any  statements,  warranties
or  representations  herein,  the Facilities  Agreement or the related documents
referred to therein, the New Facility Letter, the Guarantee, the Mortgage or any
other documents contemplated thereby, (collectively,  the "Financing Documents")
or the value, condition, priority, ownership or sufficiency of the Collateral or
the legality,  validity or enforceability of any of the Financing Documents, nor
shall  the Agent be bound to  ascertain  or  inquire  as to the  performance  or
observance of any of the terms, conditions, covenants or agreements provided for
in the  Financing  Documents,  (iii) the Agent shall not have any  obligation to
determine  whether there has occurred any Event of Default or potential Event of
Default, under any Financing Documents,  and the Agent shall not be charged with
knowledge of the happening of any event of default or potential event of default
unless it shall  have been  notified  thereof  in  writing  by the  Company or a
Secured  Party,  and (iv) the Agent  shall be  entitled to rely upon any notice,
consent,  certificate,  statement or other document believed by it to be genuine
and  correct  and to have been  signed and sent by the proper  person or persons
and, in respect of legal  matters,  upon the opinion of counsel  selected by it.
The Agent may seek  instructions  from the Secured Parties as to the exercise of
its rights, powers and remedies. If the Agent shall be instructed by the Secured
Parties to take any action hereunder,  the Agent may, before taking such action,
require that the Secured  Parties  indemnify the Agent,  in a manner  reasonably
satisfactory to the Agent, for any liability which the Agent may incur in taking
such action.

         (c)  Nothing in this  Security  Agreement,  expressed  or  implied,  is
intended to or shall be so construed as to impose upon the Agent any obligations
in respect of this Security  Agreement or any Collateral except as expressly set
forth herein or therein.  With  respect to the credit  extended by it, the Agent
shall have the same rights and powers under the Financing Documents as any other
Secured Party and may exercise the same as though it were not the Agent, and the
Agent and its affiliates may accept  deposits from,  lend money to and generally
engage in any kind of business with the Company as if it were not the Agent.

         (d) The Secured  Parties  shall  indemnify the Agent (to the extent not
reimbursed by the Company,  but without limiting the obligations of the Company)
ratably in accordance with their respective interests in the Collateral, for any
and  all  liabilities,   obligations,   losses,  damages,  penalties,   actions,
judgments,  suits,  costs,  expenses  or  disbursements  of any kind and  nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way  relating  to or arising  out of this  Security  Agreement  or any other
documents  contemplated by or referred to herein or therein or the  transactions
contemplated  hereby or thereby or the enforcement of any of the terms hereof or
of any such other documents,  provided that no Secured Party shall be liable for
any of the  foregoing  to the extent  they arise  from the gross  negligence  or
willful misconduct of the Agent.

         (e) The Agent may resign (effective upon appointment of a successor) at
any time by  giving  written  notice  thereof  to the  Secured  Parties  and the
Company.  Upon any such  resignation,  the Secured  Parties shall within 30 days
after the Agent shall have given notice of its resignation,  appoint a successor
to the Agent, which decision of the Secured Parties shall be binding upon all of
the  Secured  Parties.  Provided  no  Event  of  Default  has  occurred  and  is
continuing, any successor Agent which is not a party to the Facilities Agreement
shall be approved  by the  Company,  which  approval  shall not be  unreasonably
withheld or delayed.  Upon the acceptance of any  appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and upon the transfer of the  Collateral  to the successor  Agent,  the retiring
Agent shall be discharged from its duties and obligations  hereunder.  After any
retiring Agent's resignation hereunder as Agent, the provisions of this Security
Agreement  shall inure to its  benefit as to any actions  taken or omitted to be
taken by it while it was Agent under this Security Agreement.

         SECTION 17.  GOVERNING LAW;  WAIVER OF JURY TRIAL;  SEVERABILITY.  THIS
SECURITY  AGREEMENT  SHALL BE GOVERNED BY AND CONSTRUED IN  ACCORDANCE  WITH THE
LAWS OF THE STATE OF NEW YORK  WITHOUT  GIVING  EFFECT TO THE  CONFLICTS OF LAWS
PROVISIONS  THEREOF.  THE PARTIES HERETO  KNOWINGLY,  VOLUNTARILY  AND EXPRESSLY
WAIVE  ALL  RIGHT TO TRIAL BY JURY IN ANY  ACTION,  PROCEEDING  OR  COUNTERCLAIM
ENFORCING OR DEFENDING ANY RIGHTS  ARISING OUT OF OR RELATING TO THIS  AGREEMENT
OR THE  TRANSACTIONS  CONTEMPLATED  HEREBY.  THE COMPANY  ACKNOWLEDGES  THAT THE
PROVISIONS  OF THIS  SECTION  17 HAVE  BEEN  BARGAINED  FOR AND THAT IT HAS BEEN
REPRESENTED BY COUNSEL IN CONNECTION  THEREWITH.  Any provision of this Security
Agreement which is prohibited or unenforceable in any jurisdiction  shall, as to
such  jurisdiction,  be  ineffective  to  the  extent  of  such  prohibition  or
unenforceability  without  invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.



                         [signatures begin on next page]


<PAGE>



         IN WITNESS  WHEREOF,  the parties  hereto  have  caused  this  Security
Agreement to be duly executed and delivered as of the date first above written.

                               HUNTINGDON LIFE SCIENCES INC.


                               By:______________________________
                                         Name:
                                         Title:


                               NATIONAL WESTMINSTER BANK PLC,
                                   as Agent


                               By:______________________________
                                    Name:
                                    Title:


<PAGE>



                                    EXHIBIT A

                            Description of Equipment


                  Description       Cost
                                                                   ($000's)

                  HPLC systems        210

                  2 x APOI 365 MS/MS systems  550

                  X-Ray bone densitometer      95

                                                                     ----

                                                                     855
                                                                     ----


<PAGE>



                                    EXHIBIT B

                             Pledged Account Letter




<PAGE>







                                 April 30, 1998



The First National Bank of Maryland
25 South Charles Street, 22nd Floor
Mail Code 101-515
Baltimore, MD 21201

Attention:  Ronald C. Lapointe

         Re:  Huntingdon Life Sciences Inc.

Gentlemen:

         Huntingdon Life Sciences Inc. (the "Company") and National  Westminster
Bank plc hereby give you notice that,  pursuant to a Security Agreement dated as
of April 30, 1998  between the Company  and  National  Westminster  Bank plc, as
agent on behalf of the Secured  Parties  named  therein (in such  capacity,  the
"Agent")(the  "Security  Agreement"),  the  Company  has  granted to the Agent a
security interest in, all of the right, title and interest of the Company in and
to its  demand  deposit  account  with you under  account  number 191 10015 (the
"Pledged Account")  together with all monies,  credit balances and certificates,
instruments and other documents evidencing permitted investments held therein to
secure the payment and  performance  by the Company,  Huntingdon  Life Sciences,
Limited and Huntingdon  Life Sciences Group plc of the Secured  Obligations  (as
defined in the Security  Agreement).  It is not  necessary  that you be familiar
with  the  terms  of  the  Security  Agreement  or  any  related  document.  You
acknowledge the Agent's  security  interest in, and lien on, the Pledged Account
and the monies on deposit therein, granted to the Agent by the Company under the
Security  Agreement.  You agree to act as the  agent  for the Agent to  maintain
possession and control of the Pledged  Account in accordance  with the terms set
forth herein.

         The Company  shall be entitled to use the Pledged  Account,  subject to
your applicable  rules,  until your receipt from the Agent of notice  indicating
that an Event of Default  has  occurred  and is  continuing  under the  Security
Agreement.  The Company hereby agrees that,  upon your receipt from the Agent of
notice  indicating that an Event of Default has occurred and is continuing under
the Security  Agreement,  as set forth herein,  all right, title and interest of
the Company in the  Pledged  Account  shall  immediately  terminate  and you may
refuse to honor any checks, ACH debits, wire transfer instructions, or any other
items which the Company causes to be presented against the Pledged Account after
your receipt of such notice.  Upon written  notice to you from the Agent that an
Event of Default has occurred and is  continuing  under the Security  Agreement,
you shall not permit any  further  disbursements  from the  Pledged  Account and
shall  immediately  transfer all collected  funds in the Pledged  Account to the
Agent, subject to your set-off and banker's liens rights described below.

         You are hereby  authorized to follow your usual  procedure in the event
the Pledged  Account or any checks,  drafts or other orders for payment of money
should  be  or  become  the  subject  of  any  writ,  levy,  order,  attachment,
garnishment or other similar judicial or regulatory  order or process  ("Order")
and neither the  Company  nor the Agent shall  assert any claim  against you for
following your usual procedures in response to any such Order.

         Notwithstanding any other provisions in this Agreement, in the event of
the commencement of a case pursuant to The United States  Bankruptcy Code, filed
by or against the Company,  or in the event of the  commencement  of any similar
case under state law  providing  for the relief of debtors or the  protection of
creditors by or against the Company, you may act as you deem necessary to comply
with all  applicable  provisions  of  governing  statutes  and court  orders and
neither  the Company  nor the Agent  shall  assert any claim  against you for so
doing.

         You  acknowledge   receipt  of  the  foregoing   instructions  and,  in
connection therewith,  hereby confirm that you have not received notice from any
other person of any assignment of or security  interest in the Pledged  Account.
You agree that all notices to be sent to you with respect to the Pledged Account
shall be addressed  as set forth below or such other  address as you may specify
in writing:

                  The First National Bank of Maryland
                  25 South Charles Street, 22nd Floor
                  Mail Code 101-515
                  Baltimore, Maryland 21201
                  Attention:  Ronald C. Lapointe

                  with a copy to:

                  The First National Bank of Maryland
                  25 South Charles Street, 22nd Floor
                  Mail Code 101-850
                  Baltimore, Maryland 21201
                  Attention:  Kenneth F. Krach, Esq.

         You  agree to  provide  duplicate  monthly  statements  to the Agent in
accordance with your usual and customary  procedures  showing all deposits into,
and all  disbursements  made from, the Pledged Account for the period covered by
such monthly statements.  All such duplicate statements shall be provided to the
Agent at the same time such monthly  statements  are provided to the Company and
shall be  addressed  as set forth  below or such other  address as the Agent may
specify by written notice to you:

                    National Westminster Bank plc,
                    as Agent
                    3rd Floor, Juno Court
                    25 Prescot Street
                    London, England E1 8BB
                    Attention:                               

         Each of the Company and the Agent  acknowledges  that you shall have no
obligation,   responsibility   or  liability  to  verify  the  accuracy  of  any
disbursement  request  or  other  instrument  or  writing  delivered  to  you in
connection with the Pledged Account, whether such request is permitted under the
Security  Agreement,  the Company's use of the proceeds thereof or whether there
exists  an  Event of  Default  under  the  Security  Agreement  and that you are
entitled to rely on the  certificates,  notices,  instruments and other writings
presented to you in  connection  therewith.  In no event shall you be liable for
any consequential,  special, punitive or indirect loss or damage which the Agent
or the Company may incur or suffer in connection with this Agreement.

         The invalidity, illegality or unenforceability or any provision of this
Agreement shall not affect the validity,  legality or  enforceability  of any of
the other provisions of this Agreement which shall remain effective.

         THIS AGREEMENT  SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE  WITH,
THE LAWS OF THE STATE OF MARYLAND.  YOU, THE COMPANY AND THE AGENT  SPECIFICALLY
WAIVE THE RIGHT TO TRIAL BY JURY IN RESOLVING ANY CLAIM OR COUNTERCLAIM  RELATED
TO THE PLEDGED ACCOUNT, THIS AGREEMENT OR YOUR PERFORMANCE HEREUNDER.

         The Company hereby  releases you and all of your  directors,  officers,
agents,  attorneys or employees  (collectively,  the "Depository  Bank Parties")
from any claim,  demand,  loss,  or  liability,  the  Company may have or bring,
becoming  due,  arising  under,  out of, as a result of, in  connection  with or
related  to, this  Agreement  or your  performance  and the  performance  of the
Depository Bank Parties hereunder, provided such claim, demand, loss, liability,
or  expense  has not  directly  resulted  from the gross  negligence  or willful
misconduct of you or the Depository  Bank Parties.  The Company hereby agrees to
pay,  indemnify and hold you and the Depository  Bank Parties  harmless from and
against  any  and  all  labilities,  obligations,  losses,  damages,  penalties,
actions,  judgments,  suits,  costs,  expenses or  disbursements  of any kind or
nature  whatsoever  (including,  without  limitation,  legal  fees)  become due,
arising  under,  out of, as a result of, in  connection  with or related to this
Agreement or the performance of you and the Depository  Bank Parties  hereunder,
provided  such claim,  demand,  loss,  liability,  or  expenses is not  directly
resulting  from  the  gross  negligence  or  willful  misconduct  of  you or the
Depository Bank Parties.

         The Agent hereby  releases you and the Depository Bank Parties from any
claim,  demand, loss, or liability,  the Agent may have or bring,  becoming due,
arising  under,  out of, as a result of, in connection  with or related to, this
Agreement or the performance of you and the Depository  Bank Parties  hereunder,
provided  such claim,  demand,  loss,  liability,  or expense  has not  directly
resulted  from  the  gross  negligence  or  willful  misconduct  of  you  or the
Depository Bank Parties. The Agent hereby agrees to fully reimburse you for: (i)
any check, ACH credit or other item which is returned unpaid and the proceeds of
which were received by the Agent  hereunder;  and (ii) any check,  ACH credit or
other item, the proceeds of which were received by the Agent hereunder and which
a Court of competent jurisdiction subsequently holds to have been subject to any
Order,  or orders the  proceeds  returned  to or on behalf of the  Company.  The
Agent's  obligations  of payment  hereunder  shall  survive  the  bankruptcy  or
insolvency of the Company and upon such  bankruptcy or insolvency,  you need not
demand  payment  from the  Company or seek to offset any  amounts in the Pledged
Account or any other accounts the Company maintains with your prior to demanding
payment from the Agent, even if the Company then has sufficient funds in deposit
with you to pay such amounts.

         This  Agreement  may be terminated at any time by you upon fifteen (15)
days written  notice to the Company and the Agent,  after which fifteen (15) day
period all of your  obligations  hereunder shall be terminated,  except that you
shall hold sums then  remaining in the Pledged  Account as a mere bailee pending
(a) your  receipt  of the  mutual  instruction  of the Agent and the  Company to
transfer the same to a successor depository,  or (b) your receipt of an order of
a court of competent jurisdiction  directing transfer the same.  Notwithstanding
the foregoing,  the  indemnifications  and reimbursements  provided herein shall
survive  this  Agreement  and shall  remain in full force and  effect  until all
applicable periods of latches or statute of limitation shall expire on any claim
related hereto.

         This letter agreement may be executed in two or more counterparts, each
of which shall  constitute an original and all of which,  taken together,  shall
constitute one and the same letter agreement.

                          NATIONAL WESTMINSTER BANK PLC



                          By:    
                          Name:
                          Title:



                          HUNTINGDON LIFE SCIENCES INC.



                          By: 
                          Name:
                          Title:

Accepted and Agreed this
30th day of April, 1998


THE FIRST NATIONAL BANK OF MARYLAND


By:                                                       
     Name:
     Title: