Document:

Morria Biopharmaceuticals PLC

Company

 

and

 

Iroquois Master Fund Ltd.

 

and

 

Alpha Capital Anstalt

Secured Parties

 

Security Agreement 

 

 

    	 

    	 

    

 

Contents 

 

	1	Definitions and Interpretation	1
	 	 	 
	2	Payment of Secured Liabilities	6
	 	 	 
	3	Grant of Security	6
	 	 	 
	4	Perfection of Security	8
	 	 	 
	5	Further Assurance	9
	 	 	 
	6	Representations and Warranties	10
	 	 	 
	7	Negative Pledge and Disposals	11
	 	 	 
	8	General Undertakings	11
	 	 	 
	9	Investments	13
	 	 	 
	10	Accounts	14
	 	 	 
	13	Powers of the Secured Parties	16
	 	 	 
	14	Enforcement and Powers of the Secured Parties	16
	 	 	 
	15	Receiver	18
	 	 	 
	16	Powers of Receiver	19
	 	 	 
	17	Application of Monies	20
	 	 	 
	18	Power of Attorney	21
	 	 	 
	19	Restriction	22
	 	 	 
	20	Relationship between Secured Parties	22
	 	 	 
	21	Costs and Indemnity	23
	 	 	 
	22	Release	24
	 	 	 
	23	Assignment and Transfer	24
	 	 	 
	24	Set-off	24
	 	 	 
	25	New Accounts	25
	 	 	 
	26	Currency	25
	 	 	 
	27	Further Provisions	25
	 	 	 
	28	Notices	28
	 	 	 
	29	Governing Law and Jurisdiction	29
	 	 	 
	Schedule 1 : Form of Notice of Assignment – Insurance Policies	30
	 	 
	Schedule 2 : Intellectual Property	32

 

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This Security Agreement is made on:
                             5th April 2012

 

Between:

 

		(1)	Morria Biopharmaceutricals PLC, an unlisted public company incorporated and registered in
England and Wales with company number 05252842 whose registered office is at Thames House, Portsmouth Road, Esher, Surrey, KT10
9AD (Company);

 

and

 

		(2)	Iroquois Master Fund Ltd. of 641 Lexington Avenue, 20th Floor, New York, NY (Iroquois);
and

 

		(3)	Alpha Capital Anstalt of Pradafant 7, LI-9490, Vaduz, Furstentum, Liechtenstein (Alpha and,
together with Iroquois, the Secured Parties).

 

It is
agreed as follows:

 

		1	Definitions and Interpretation

 

		1.1	Definitions

 

The following definitions and
rules of interpretation in this clause apply in this Agreement:

 

Account means any account
opened or maintained by the Company with any of the Secured Parties or any other person (and any replacement account or subdivision
or subaccount of that account), the debts or debts represented thereby and all Related Rights and includes, for the avoidance of
doubt, the Restricted Account;

 

Administrator means
an administrator appointed to manage the affairs, business and property of the Company;

 

Authorisation means
an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration;

 

Book Debts means all
present and future book and other debts and monetary claims due or owing to the Company and any proceeds of such debts and claims
(including any claims or sums of money deriving from or in relation to any Intellectual Property, any Investment, the proceeds
of any Insurance Policy, any court order or judgment, any contract or agreement to which the Company is a party and any other assets,
property, rights or undertaking of the Company);

 

Business Day means a
day (other than a Saturday or Sunday) on which commercial banks are open for general business in London and New York;

 

Charged Assets means
all the assets, property and undertaking for the time being subject to the security interests created by this Agreement (and references
to the Charged Assets shall include references to any part of it);

 

Commencement Notice
means a written notice, given by any Secured Party to the other Secured Parties in accordance with the notice provisions set forth
in the Securities Purchase Agreement, pursuant to which such Secured Party notifies the other Secured Parties of the existence
of one or more Events of Default and of such Secured Party’s intent to commence the exercise of one or more of the remedies
provided for under this Agreement with respect to all or any portion of the Charged Assets as a consequence thereof, which notice
shall incorporate a reasonably detailed description of each Event of Default then existing and of the remedial action proposed
to be taken;

 

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Costs means all costs,
charges, expenses and liabilities of any kind including, without limitation, costs and damages in connection with litigation, professional
fees, disbursements and any value added tax charged on Costs;

 

Equipment means all
present and future equipment, plant, machinery, office equipment, computers, tools, vehicles, furniture, fittings, installations
and apparatus and other tangible moveable property for the time being owned by the Company, including any part of it and all spare
parts, replacements, modifications and additions, and all Related Rights;

 

Event of Default means
any of the following events:

 

		(a)	any of the Secured Liabilities are not paid or discharged when the same ought to be paid or discharged
by the Company (whether on demand, at scheduled maturity, or by acceleration or otherwise, as the case may be) other than where
such failure to pay is the result of an administrative or technical failure and payment is made within 3 days of its due date;
and

 

		(b)	any "Event of Default" as such term is defined in the Notes;

 

Financial
Collateral means shall have the meaning given to that expression in the Financial Collateral Regulations;

 

Financial Collateral Regulations
means the Financial Collateral Arrangements (No. 2) Regulations 2003 (SI 2003/3226);

 

Grantors has the meaning
given to such term in the Security Agreement (as defined in the Securities Purchase Agreement);

 

Group means the Company
and each of its subsidiaries;

 

Insolvency Proceeding has
the meaning given to such term in the Securities Purchase Agreement;

 

Insurance Policy means
any policy of insurance in which the Company may from time to time have an interest;

 

Intellectual Property
means the Company's present and future patents, trade marks, service marks, trade names, business names, design rights, copyrights,
moral rights, inventions, topographical or similar rights, confidential information, know-how and other intellectual property rights
and interests, and any interest in any of these rights, whether or not registered, the benefit of all applications and rights to
rights to use such assets, including such assets set out in Schedule 2, and all Related Rights;

 

Investments
means:

 

		(a)	any stocks, shares, debentures, securities and certificates of deposit;

 

		(b)	all interests in collective investment schemes; and

 

		(c)	all warrants, options and other rights to subscribe or acquire any of the investments described
in (a) and (b),

 

in each case whether held directly
by or to the order of the Company or by any trustee, nominee, fiduciary or clearance system on its behalf and all Related Rights
(including all rights against any such trustee, nominee, fiduciary or clearance system);

 

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Material Adverse Effect
means a material adverse effect upon:

 

		(a)	the business, operations, property, condition (financial or otherwise) or prospects of the Company;

 

		(b)	the ability of the Company to perform or comply with any of its payment and/or its other obligations
under this Agreement; or

 

		(c)	the validity or enforceability of, or the effectiveness or ranking of any Security granted or purporting
to be granted pursuant to this Agreement or the rights or remedies of the Secured Parties under this Agreement;

 

Notes
has the meaning given to such term in the Securities Purchase Agreement;

 

Permitted Liens has
the meaning given to such term in the Notes;

 

Permitted Secured Party
means, with respect to the exercise of any remedy provided for under this Agreement, any Secured Party that has delivered a Commencement
Notice with respect to the exercise of such remedy to the other Secured Parties and has not received a Veto Notice with respect
thereto within the Veto Period; provided, however, there shall only be a single Permitted Secured Party that may exercise any specific
remedy at any one time (it being agreed that if a Commencement Notice is delivered by more than one Secured Party with respect
to any remedy provided for under this Agreement, then the first Secured Party to deliver a Commencement Notice and not receive
a Veto Notice within the Veto Period shall be the only Secured Party that may exercise such remedy);

 

Properties means all
freehold and leasehold properties (whether registered or unregistered) and all commonhold properties, now or in the future (and
from time to time) owned by the Company, or in which the Company holds an interest and Property means any of them;

 

Receiver means a receiver
or receiver and manager or, where permitted by law, an administrative receiver of the whole or any part of the Charged Assets and
that term will include any appointee made under a joint and/or several appointment;

 

Related Rights means,
in relation to any asset:

 

		(a)	the proceeds of sale of any part of that asset;

 

		(b)	all rights under any licence, agreement for sale or agreement for lease in respect of that asset;

 

		(c)	all rights, powers, benefits, claims, contracts, warranties, remedies, security, guarantees, indemnities
or covenants for title in respect of that asset; and

 

		(d)	any monies and proceeds paid or payable in respect of that asset;

 

Relevant Jurisdiction means,
in relation to the Company:

 

		(a)	its jurisdiction of incorporation;

 

		(b)	any jurisdiction where any asset subject to or intended to be subject to the Security to be created
by it pursuant to this Agreement is situated; and

 

		(c)	any jurisdiction where it conducts its business;

 

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Restricted Account means
the account to be confirmed in writing by the Company to the Secured Parties into which all Restricted Insurance Proceeds are to
be paid;

 

Restricted Insurance Proceeds
means any proceeds received by the Company for its benefit from time to time under its directors and officers insurance policy
number WD104000a issued by Howden Insurance Brokers Limited and any replacement policy in respect thereof, provided that any proceeds
received by the Company as a conduit of payment of such funds to its directors and/or officers, or any funds received by the Company
as reimbursement for payments made or to be made to its directors or officers, shall not be deemed to be Restricted Insurance Proceeds;

 

Secured Liabilities
mean all obligations which the Company and each of the other Grantors may at any time have to the Secured Parties arising under
this Agreement, the Notes, the Guaranties, and the other Transaction Documents (as each such term in defined in the Securities
Purchase Agreement, whether present or future, actual or contingent (and whether incurred solely or jointly and whether as principal
or as surety or in some other capacity) and including, without duplication, reasonable attorneys’ fees and expenses and any
interest, fees, or expenses that accrue after the filing of an Insolvency Proceeding, regardless of whether allowed or allowable
in whole or in part as a claim in any Insolvency Proceeding;

 

Securities Purchase Agreement
means a securities purchase Agreement dated on or around the date hereof (as may be amended, restated, supplemented,
or otherwise modified from time to time) between the Company and the Secured Parties;

 

Security means any mortgage,
charge (whether fixed or floating, legal or equitable), pledge, lien, assignment by way of security or other security interest
securing any obligation of any person, or any other agreement or arrangement having a similar effect;

 

Security Documents has
the meaning given to such term in the Securities Purchase Agreement;

 

Security Financial Collateral
Arrangement means shall have the meaning given to that expression in the Financial Collateral Regulations;

 

Security Period means
the period starting on the date of this Agreement and ending on the date on which all the Secured Liabilities have been unconditionally
and irrevocably paid and discharged in full and no further Secured Liabilities are capable of being outstanding;

 

Significant Secured Party
means, on any date of determination, any Secured Party holding twenty percent (20%) or more of the aggregate principal amount of
Notes outstanding on such date;

 

Veto Notice means, with
respect to any Commencement Notice, a written notice given by any Significant Secured Party to the other Secured Parties in accordance
with the notice provisions set forth in the Securities Purchase Agreement pursuant to which such Significant Secured Party notifies
the other Secured Parties of its objection to the commencement of the remedial action specified in such Commencement Notice and
certifies that, to the best of its knowledge, it is a Significant Secured Party; and

 

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Veto Period means, with
respect to any Commencement Notice (other than a Commencement Notice given by a Significant Secured Party at a time when such Significant
Secured Party is the only the Significant Secured Party), the period of ten (10) consecutive calendar days following the delivery
of such Commencement Notice to the Secured Parties (it being understood and agreed that there shall be no Veto Period with respect
to a Commencement Notice given by a Significant Secured Party at a time when such Significant Secured Party is the only the Significant
Secured Party).

 

		1.2	Interpretation

 

Unless
otherwise defined herein, a term defined in the Securities Purchase Agreement shall have the same meaning in this Agreement and,
unless the context otherwise requires:

 

		(a)	a reference to a statute or statutory provision includes a reference to any subordinate legislation
made under that statute or statutory provision, to any modification, re-enactment or extension of that statute or statutory provision
and to any former statute or statutory provision which it consolidated or re-enacted before the date of this Agreement;

 

		(b)	a reference to one gender includes a reference to the other genders;

 

		(c)	words in the singular include the plural and in the plural include the singular;

 

		(d)	a reference to a Clause or Schedule is to a Clause of, or Schedule to, this Agreement and references
to paragraphs are to paragraphs of the relevant Schedule;

 

		(e)	a reference to this Agreement (or any specified provision of it) or any other document shall
be construed as a reference to this Agreement, that provision or that document as in force for the time being and as amended or
novated from time to time;

 

		(f)	a reference to a person shall include a reference to an individual, firm, corporation, unincorporated
body of persons, or any state or any agency of a person;

 

		(g)	a reference to an amendment includes a supplement, variation, novation or re-enactment (and
amended shall be construed accordingly);

 

		(h)	a reference to assets includes present and future properties, undertakings, revenues, rights
and benefits of every description;

 

		(i)	a reference to a regulation includes any regulation, rule, official directive, request or
guideline (whether or not having the force of law) of any governmental, inter-governmental or supranational body, agency, department
or regulatory, self-regulatory or other authority or organisation; and

 

		(j)	clause, schedule and paragraph headings shall not affect the interpretation of this Agreement.

 

		1.3	Nature of security over real property

 

A reference in this Agreement
to a charge or mortgage of any freehold, leasehold or commonhold property includes:

 

		(a)	all buildings and fixtures (including trade and tenant's fixtures) which are situated on that property
at any time;

 

		(b)	the proceeds of the sale of any part of that property; and

 

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		(c)	the benefit of any covenants for title given, or entered into, by any predecessor in title of the
Company in respect of that property, and any monies paid or payable in respect of those covenants.

 

		1.4	Law of Property (Miscellaneous Provisions) Act 1989

 

For the purposes of section
2 of the Law of Property (Miscellaneous Provisions) Act 1989, the terms of the Securities Purchase Agreement and of any side letters
between any parties in relation to the Securities Purchase Agreement are incorporated into this Agreement.

 

		1.5	Third party rights

 

A person who is not a party
to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce, or to enjoy the benefit of, any
term of this Agreement.

 

		1.6	Perpetuity period

 

If the rule against perpetuities
applies to any trust created by this Agreement, the perpetuity period shall be 125 years (as specified by section 5(1) of the Perpetuities
and Accumulations Act 2009).

 

		1.7	Schedules

 

The schedules form part of
this Debenture and shall have effect as if set out in full in the body of this Debenture. Any reference to this Debenture includes
the schedules.

 

		2	Payment of Secured Liabilities

 

The Company covenants with
each of the Secured Parties separately that it shall on demand pay and discharge the Secured Liabilities when they become due and
payable provided that neither such covenant nor the Security constituted by this Deed shall extend to or include any liability
or sum which would, but for this proviso, cause such covenant or security to be unlawful or prohibited by any applicable law.

 

		3	Grant of Security

 

		3.1	Fixed Security

 

As a continuing security for
the payment and discharge of the Secured Liabilities, the Company with full title guarantee charges and agrees to charge to each
of the Secured Parties separately, by way of first fixed charge all the Company's right, title and interest from time to time in
and to:

 

		(a)	all Properties acquired by the Company in the future;

 

		(b)	all present and future interests of the Company not effectively mortgaged or charged under the
preceding provisions of this Clause 3 in, or over, freehold or leasehold property;

 

		(c)	all present and future rights, licences, guarantees, rents, deposits, contracts, covenants and
warranties relating to the Properties;

 

		(d)	all licences, consents and Authorisations (statutory or otherwise) held or required in connection
with the Company's business or the use of any Charged Assets, and all rights in connection with them;

 

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		(e)	all present and future goodwill and rights in relation to uncalled capital for the time being of
the Company;

 

		(f)	all the Equipment;

 

		(g)	all the Intellectual Property;

 

		(h)	all the Book Debts;

 

		(i)	all the Investments; and

 

		(j)	all Accounts.

 

		3.2	Assignment

 

As a continuing security for
the payment and discharge of the Secured Liabilities, the Company assigns and agrees to assign absolutely with full title guarantee
to each of the Secured Parties separately all the Company’s rights, title and interest from time to time in and to the proceeds
of any Insurance Policy (including without limitation, any insurances relating to the Properties or the Equipment but excluding
any Restricted Insurance Proceeds) and all Related Rights.

 

		3.3	Floating Charge

 

		3.3.1	The Company with full title guarantee charges to each of the Secured Parties separately, by way
of first floating charge, all present and future undertaking, property, assets and rights of the Company at any time.

 

		3.3.2	The floating charge created by sub-Clause 3.3.1 above shall be deferred in priority to all fixed
Security validly and effectively created by the Company pursuant to Clauses 3.1 (Fixed Security) and Clause 3.2 (Assignments)
above.

 

		3.3.3	Paragraph 14 of Schedule B1 of the Insolvency Act 1986 applies to the floating charge created pursuant
to this Clause 3.3.

 

		3.4	Automatic conversion of floating charge

 

Notwithstanding Clause 3.5
(Conversion of floating charge by notice) and without prejudice to any law which may have a similar effect, the floating
charge created by Clause 3.3 (Floating Charge) shall automatically and immediately (without notice) be converted into a
fixed charge over all the assets subject to the floating charge if, without the prior written consent of the Secured Parties or
unless otherwise permitted by the Transaction Documents,:

 

		(a)	the Company:

 

		(i)	creates or attempts to create any Security (other than any Permitted Lien) over all or any part
of the Charged Assets; or

 

		(ii)	disposes, or attempts to dispose of, all or any part of the Charged Assets; or

 

		(b)	any person levies (or attempts to levy) any distress, attachment, execution or other process against
all or any part of the Charged Assets;

 

		(c)	a meeting is convened for the passing of a resolution for the voluntary winding-up of the Company;

 

		(d)	a petition is presented for the compulsory winding-up of the Company;

 

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		(e)	a petition or application is presented for the making of an administration order in relation to
the Company; or

 

		(f)	any person gives notices of its intention to appoint an administrator to the Company of files such
a notice with the court.

 

		3.5	Conversion of floating charge by notice

 

Each Secured Party shall be
entitled to, in its sole discretion, by written notice to the Company, convert the floating charge created under this Agreement
with immediate effect into a fixed charge as regards any part of the Charged Assets specified by the relevant Secured Party in
that notice if:

 

		(a)	an Event of Default occurs and is continuing;

 

		(b)	the relevant Secured Party reasonably consider those assets to be in danger of being seized or
sold under any form of distress, attachment, execution or other legal process of to be otherwise in jeopardy; or

 

		(c)	the relevant Secured Party reasonably consider that it is desirable in order to protect the priority
of the security.

 

		3.6	Assets acquired after any floating charge crystallisation

 

Any asset acquired by the Company
after any crystallisation of the floating charge created under this Agreement which, but for such crystallisation, would be subject
to a floating charge shall (unless the Secured Parties confirm in writing to the contrary) on the date of such acquisition be charged
by the Company in favour of each of the Secured Parties separately by way of first fixed charge.

 

		4	Perfection of Security

 

		4.1	Title Documents

 

The Company shall, on the execution
of this Agreement (or, if later, the date of acquisition of the relevant Charged Asset), deposit with the Secured Parties (for
the purpose of security only) and the Secured Parties shall, for the duration of this Agreement be entitled to hold (for the purpose
of security only):

 

		(a)	all deeds and documents of title relating to the Charged Assets which are in the possession or
control of the Company (if these are not within the possession and/or control of the Company, the Company undertakes to obtain
possession of all such deeds and documents of title);

 

		(b)	all Insurance Policies; and

 

		(c)	all certificates or other documents of title to the Investments, and relevant stock transfer forms
executed in blank by the Company.

 

		4.2	Notices to be given by the Company

 

The Company shall immediately
on the execution of this Agreement;

 

		4.2.1	give notice to the relevant insurers of the assignment of the Company's rights and interest in
and under all policies of insurance (and for the avoidance of doubt, no notice of assignment will be required in respect of the
Company's directors and officers insurance policy number WD104000a issued by Howden Insurance Brokers Limited and any replacement
policy in respect thereof) pursuant to Clause 3.2 substantially in the form set out in Part A of Schedule 1 and procure that each
addressee of such notice promptly provides an acknowledgement of the Secured Parties' interest to the Secured Parties, substantially
in the form set out in Part B of Schedule 1; and

 

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		4.2.2	give notice to any bank, financial institution or other person (excluding the Secured Parties)
with whom the Company has an account substantially in the form set out in Part A of Schedule 2 of the charging to the Secured Parties
pursuant to Clause 3.1(j) of the Company's rights and interests under such accounts and procure that each addressee of such notice
promptly provides an acknowledgement of the Secured Parties' interest to the Secured Parties, substantially in the form set out
in Part B of Schedule 2.

 

		5	Further Assurance

 

The Company, at its own cost,
shall prepare and execute such further legal or other mortgages, charges or transfers (containing a power of sale and such other
provisions as any Secured Party may reasonably require) in favour of the Secured Parties as any Secured Party may, in its absolute
discretion, require from time to time over all or any part of the Charged Assets and give all notices, orders and directions which
any Secured Party may require in its absolute discretion for perfecting, protecting or facilitating the realisation of its security
over the Charged Assets.

 

		6	Representations and Warranties

 

The Company represents and
warrants to each Secured Party in the terms set out in this Clause 6.

 

		6.1	The Company

 

		6.1.1	The Company is a limited liability corporation, duly incorporated and validly existing under the
law of its jurisdiction of incorporation.

 

		6.1.2	The Company has the power to own its assets and carry on its business as it is being conducted.

 

		6.1.3	The obligations expressed to be assumed by it in this Agreement are legal, valid, binding and enforceable
obligations and (without limiting the generality of the foregoing, this Agreement creates the security interests which it purports
to create and those security interests are valid and effective.

 

		6.1.4	The entry into and performance by it of, and the transactions contemplated by, this Agreement do
not and will not conflict with:

 

		(a)	any law or regulation applicable to it;

 

		(b)	its constitutional documents; or

 

		(c)	any agreement or instrument binding upon it or any of its assets or constitute a default or termination
event (however described) under any such agreement or instrument.

 

		6.1.5	The Company has the power to enter into, perform and deliver, and has taken all necessary action
to authorise its entry into, performance and delivery of, this Agreement and the transactions contemplated by this Agreement.

 

		6.1.6	No limit on the Company's powers will be exceeded as a result of the grant of security contemplated
by this Agreement.

 

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		6.1.7	All Authorisations required or desirable:

 

		(a)	to enable it lawfully to enter into, exercise its rights and comply with its obligations in this
Agreement; and

 

		(b)	to make this Agreement admissible in evidence in its jurisdiction of incorporation,

 

have
been obtained or effected and are in full force and effect.

 

		6.1.8	All Authorisations necessary for the conduct of the business, trade and ordinary activities of
members of the Group have been obtained or effected and are in full force and effect if failure to obtain or effect those Authorisations
has or is reasonably likely to have a Material Adverse Effect.

 

		6.1.9	The choice of English law as the governing law of this Agreement will be recognised and enforced
in each of the Relevant Jurisdictions.

 

		6.1.10	Any judgment obtained in England in relation to this Agreement will be recognised and enforced
in the Relevant Jurisdictions.

 

		6.1.11	Its irrevocable submission under Clause 29.2
(Jurisdiction) to the jurisdiction of the Courts of England and agreement not to claim any immunity to which its
assets may be entitled are legal valid and binding under the laws of the Relevant Jurisdictions.

 

		6.1.12	No litigation, arbitration or administrative proceedings of or before any court, arbitral body
or agency which, if adversely determined, might reasonably be expected to have a Material Adverse Effect have (to the best of its
knowledge and belief) been started or threatened against it.

 

		6.1.13	No Insolvency Proceeding as been taken or, to its knowledge, threatened in relation to it.

 

		6.1.14	It is not unable to pay its debts as they fall due and the value of the Company's assets is not
less than the amount of its liabilities, taking into account the Company's contingent and prospective liabilities.

 

		6.2	The Charged Assets

 

		6.2.1	The Company is the absolute legal and beneficial owner of all the Charged Assets free from any
Security (other than any Security created pursuant to the Security Documents or any Permitted Lien).

 

		6.2.2	The Company has not received or acknowledged notice of any adverse claim by any person in respect
of the Charged Assets or any interest in it.

 

		6.2.3	No Security expressed to be created under this Agreement is liable to be avoided, or otherwise
set aside, on the liquidation or administration of the Company or otherwise.

 

		6.2.4	There are no covenants, agreements, reservations, conditions, interests, rights or other matters
whatever, which materially adversely affect the Charged Assets.

 

		6.2.5	There is no breach of any law or regulation which materially adversely affects the Charged Assets.

 

		6.2.6	No facility necessary for the enjoyment and use of the Charged Assets is subject to terms entitling
any person to terminate or curtail its use.

 

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		6.2.7	The Insurances Policies are in full force and effect and free from Security (other than under this
Agreement or the other Security Documents) and there has been no material breach of any of the obligations under the Insurance
Policies.

 

		6.2.8	There is no prohibition on assignment in any Insurance Policies, or the relevant clauses of any
of them, and the entry into this Agreement by the Company does not and will not constitute a breach of any Insurance Policy or
any other agreement or instrument binding on the Company or its assets.

 

		6.2.9	The Company is not aware of any adverse circumstance relating to the validity, subsistence or use
of any of its Intellectual Property could reasonably be expected to have a Material Adverse Effect.

 

		6.2.10	The Company holds no interest in any Properties.

 

		6.3	Time when representations are made

 

The representations and warranties
set out in this Clause 6 are made on the date of this Agreement and shall be deemed to be made on each day of the Security Period
with reference to the facts and circumstances then existing.

 

		7	Negative Pledge and Disposals

 

The Company undertakes that
it shall not at any time during the Security Period, except with the prior written consent of the Secured Parties:

 

		(a)	create, purport to create or permit to subsist any Security on, or in relation to, any of the Charged
Assets (other than any Permitted Lien or any Security created pursuant to the Security Documents), other than the Security created
by this Agreement; or

 

		(b)	sell, assign, transfer, grant, lease, part with possession of or otherwise dispose of in any manner
(or purport to do so) all or any part of, or any interest in, the Charged Assets; or

 

		(c)	create or grant (or purport to create or grant) any interest in the Charged Assets in favour of
a third party.

 

		8	General Undertakings

 

		8.1	Preservation of Charged Assets

 

The Company shall not do, or
permit to be done, any act or thing which would or might depreciate, jeopardise or otherwise prejudice the security held by the
Secured Parties or materially diminish the value of any of the Charged Assets or the effectiveness of the security created by this
Agreement.

 

		8.2	Enforcement of rights

 

The Company shall use its best
endeavours to:

 

		(a)	procure the prompt observance and performance of the covenants and other obligations imposed on
the Company's counterparties; and

 

		(b)	enforce any rights and institute, continue or defend any proceedings relating to any of the Charged
Assets which any Secured Party may require from time to time.

 

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		8.3	Notice of Breaches

 

The Company shall promptly
on becoming aware of any of the same give the Secured Parties notice in writing of any breach of representation or warranty, or
covenant set out in this Agreement.

 

		8.4	Book Debts

 

		8.4.1	The Company shall not (except as provided below or with the prior written consent of the Secured
Parties) release, exchange, compound, set-off, grant time or indulgence in respect of, or in any other manner deal with, all or
any of the Book Debts.

 

		8.4.2	Subject to Clause 10.2 (Operation Before Event of Default) below, the Company shall on behalf
of the Secured Parties, collect in and realise all Book Debts and hold those proceeds in trust for the Secured Parties.

 

		8.4.3	Prior to the occurrence of an Event of Default, the proceeds of the realisation of Book Debts (other
than the Restricted Insurance Proceeds) shall (subject to any restriction on the application of such proceeds contained in this
Agreement or in the other Transaction Documents) be released from the fixed charge created pursuant to Clause 3.1 (Fixed Security)
and the Company shall be entitled to apply such proceeds as it see fit provided that such proceeds shall continue to be subject
to the floating charge created pursuant to Clause 3.3 (Floating Charge) and the terms of this Agreement.

 

		8.4.4	Prior to the occurrence of an Event of Default, the Company shall pay all Restricted Insurance
Proceeds into the Restricted Account.

 

		8.4.5	After the occurrence of an Event of Default, the Company shall pay the proceeds of the realisation
of any Book Debts (including the Restricted Insurance Proceeds) to the Secured Parties or into such account as the Secured Parties
may nominate.

 

		8.5	Intellectual Property

 

The Company shall:

 

		(a)	take all such steps and do all such acts as may be necessary to maintain the subsistence and validity
of the Intellectual Property and, where appropriate, use all reasonable endeavours to protect and safeguard the Intellectual Property
against theft, loss, destruction, unauthorised access, copying or use by third parties

 

		(b)	pay all renewal and other fees which may become payable in respect of any of the Intellectual Property
before or as soon as they become due and produce to the Secured Parties on demand a receipt for such fees or other evidence of
payment of those fees;

 

		(c)	not, without the prior written consent of the Secured Parties abandon, cancel or allow any of the
Intellectual Property to become void, lapse or to become vulnerable to attack for non-use or otherwise;

 

		(d)	use all reasonable endeavours to detect any material infringement of, or challenge to, any of the
Intellectual Property and, immediately after becoming aware thereof, inform the Secured Parties and take such steps at the cost
of the Company, as the Secured Parties may from time to time reasonably direct in relation to such infringement or challenge Provided
that the Company shall not be precluded from taking such steps as it shall consider necessary or desirable in relation to any infringement
of or challenge to any of the Intellectual Property;

 

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		(e)	not, without the prior written consent of the Secured Parties apply to amend the specification
or drawing of any of the letters patent or registered trade or service marks forming part of the Intellectual Property or enter
any conditions, restrictions or disclaimers in relation to any registered Intellectual Property; and

 

		(f)	not use or allow to be used, or take any step or omit to take any step in respect of, any of the
Intellectual Property which may in any way materially and adversely affect its value,

 

provided
that at all times the Company shall be permitted, without the consent of the Secured Parties, to make any amendments to the Intellectual
Property in the ordinary course of patent prosecution in order to advance prosecution.

 

		9	Investments

 

		9.1	Investments – Prior to an Event of Default

 

Notwithstanding any other terms
of this Agreement, prior to the occurrence of an Event of Default:

 

		(a)	the Company shall be entitled to receive all dividends, interest and other monies in respect of
the Investments free from the security created by this Agreement; and

 

		(b)	the Company shall be entitled to exercise all voting rights attached to the Investments provided
that it shall not exercise (and shall procure that any nominee acting on its behalf does not exercise) such voting rights in any
manner, or otherwise permit or agree to any (a) variation of the rights attaching to or conferred by any of the Investments (including
any amendment to the memorandum or articles of association or any other constitutional documents of any issuer) or (b) increase
in the issued share capital of any company whose shares are charged pursuant to this Agreement or (c) take any other action or
do any other thing, which, in the reasonable opinion of any Secured Party, would prejudice the value of, or the ability of any
Secured Party to realise, the Security created by this Agreement.

 

		9.2	Investments – After an Event of Default

 

Each Secured Party may, upon
the occurrence of an Event of Default, at its discretion (in the name of the Company or otherwise and without any further consent
or authority from the Company):

 

		(a)	exercise (or refrain from exercising) any voting rights in respect of the Investments;

 

		(b)	apply all dividends, interest and other monies arising from the Investments in accordance with
Clause 17 (Application of Monies);

 

		(c)	transfer the Investments into the name of such nominee(s) of the relevant Secured Party as they
shall require; and

 

		(d)	exercise (or refrain from exercising) the powers and rights conferred on or exercisable by the
legal or beneficial owner of the Investments,

 

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in such manner and on such terms as the relevant Secured Party may think fit, and the proceeds of any
such action shall form part of the Charged Assets.

  

		9.3	Payment of Calls

 

The Company shall pay when
due all calls or other payments which may be or become due in respect of any of the Investments, and in any case of default by
the Company in such payment, each Secured Parties may, if it thinks fit, make such payment on behalf of the Company in which case
any sums paid by that Secured Party shall be reimbursed by the Company to that Secured Party on demand.

 

		9.4	Delivery of Documents of Title

 

The Company shall promptly
on the request of any Secured Party, deliver (or procure delivery) to that Secured Party, and that Secured Party shall be entitled
to retain, all of the Investments and any certificates and other documents of title representing the Investments to which the Company
(or its nominee(s)) is or becomes entitled together with any other document which that Secured Party may reasonably request (in
such form and executed as that Secured Party may reasonably require) with a view to perfecting or improving the security of the
Secured Parties over the Investments or to registering any Investment in its name or the name of any nominee(s).

 

		10	Accounts

 

		10.1	Notification and Variation

 

The Company, during the subsistence
of this Agreement:

 

		(a)	shall promptly deliver to the Secured Parties on or prior to the date of this Agreement (and, if
any change occurs thereafter, on the date of such change), details of each Account maintained by it with any bank or financial
institution (other than with a Secured Party); and

 

		(b)	shall not, without the Secured Parties prior written consent, permit or agree to any variation
of the rights attaching to any Account or close any Account.

 

		10.2	Operation Before Event of Default

 

Notwithstanding any other term
of this Agreement, the Company shall prior to the occurrence of an Event of Default be entitled to receive, withdraw or otherwise
transfer any credit balance from time to time on any Account other than the Restricted Account.

 

		10.3	Operation After Event of Default

 

After the occurrence of an
Event of Default, the Company shall not be entitled to receive, withdraw or otherwise transfer any credit balance from time to
time on any Account except with the prior consent of the Secured Parties.

 

		10.4	Restricted Account

 

		10.4.1	Prior to the expiry of the Security Period, the Company shall not be entitled to receive, withdraw
or otherwise transfer any credit balance from the Restricted Account except with the prior consent of the Secured Parties.

 

		10.4.2	If, on or prior to such time as Restricted Insurance Proceeds are first received by the Company
following the execution of this Agreement,:

 

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		(a)	the Company chooses to open a new bank account and notifies the Secured Parties in writing that
this is the Restricted Account for the purposes of this Agreement, the Company shall promptly give notice to the relevant bank
or financial institution with whom the Restricted Account is opened, substantially in the form set out in Part A of Schedule 2
of the charging to the Secured Parties pursuant to Clause 3.1(j) of the Company's rights and interests under the Restricted Account
(and instructing the relevant bank or financial institution that, prior to the end of the Security Period, the Company shall not
be entitled to make withdrawals from such account without the written consent of the Secured Parties) and procure that each addressee
of such notice promptly provides an acknowledgement of the Secured Parties' interest to the Secured Parties, substantially in the
form set out in Part B of Schedule 2); or

 

		(b)	the Company chooses to designate one of its existing bank accounts, its right, title and interest
in respect of which is to be charged on the date of this Agreement pursuant to Clause 3.1(j) above, and notifies the Secured Parties
in writing that this is the Restricted Account for the purposes of this Agreement, the Company shall promptly instruct the relevant
bank or financial institution with whom the Restricted Account is held that, prior to the end of the Security Period, the Company
shall not be entitled to make withdrawals from such account without the written consent of the Secured Parties.

 

		10.4.3	Upon its first receipt of Restricted Insurance Proceeds following the execution of this Agreement,
to the extent it has not already done so, the Company shall notify the Secured Parties in writing as soon as reasonably practicable
and in any event within three Business Days of such receipt as to the identity of the Restricted Account.

 

		10.5	Application of Monies

 

Each Secured Party shall, following
the occurrence of an Event of Default, be entitled without notice to apply, transfer or set-off any or all of the credit balances
from time to time on any Account in or towards the payment or other satisfaction of all or part of the Secured Liabilities in accordance
with Clause 17 (Application of Monies).

 

		11	Property

 

The
Company shall:

 

		(a)	notify the Secured Parties forthwith upon the acquisition by the Company of any freehold or leasehold
property;

 

		(b)	on demand by the Secured Parties and at the cost of the Company execute and deliver to the Secured
Parties a legal mortgage in favour of the Secured Parties of any freehold or leasehold property which becomes vested in it after
the date of this Agreement in form and substance satisfactory to the Secured Parties.

 

		12	Insurance

 

The Company shall at all times
during the subsistence of this Agreement:

 

		(a)	keep the Charged Assets with reputable and responsible insurers previously approved by the Secured
Parties in such manner and to such extent as is reasonable and customary for an enterprise engaged in the same or similar business
and in the same or similar localities against such risks and contingencies as the Secured Parties may in its absolute discretion
require;

 

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		(b)	if required by any Secured Party, cause each insurance policy or policies relating to the Charged
Assets other than any Insurance Policy which has been the subject of a Notice of Assignment pursuant to Clause 4 (Perfection
of Security) to contain (in form and substance reasonably satisfactory to the Secured Parties) an endorsement naming the Secured
Parties as sole loss payee in respect of all claims;

 

		(c)	promptly pay all premiums and other monies payable under all its Insurance Policies and promptly
upon request, produce to the Secured Parties a copy of each policy and evidence (reasonably acceptable to the Secured Parties)
of the payment of such sums; and

 

		(d)	if required by the Secured Parties (but subject to the provisions of any lease of the Charged Assets),
deposit all Insurance Policies relating to the Charged Assets with the Secured Parties.

 

		13	Powers of the Secured Parties

 

		13.1	Power to Remedy

 

If the Company fails to comply
with any of its obligations under this Agreement and that failure is not remedied within seven days of any Secured Party giving
notice of such failure to the Company, each Secured Party shall be entitled (but shall not be bound) to remedy such non-compliance
and the Company irrevocably authorises each Secured Party and its agents to do all such things as are necessary or desirable for
that purpose.

 

		13.2	Exercise of Rights

 

The rights of the Secured Parties
under Clause 13.1 are without prejudice to any other rights of the Secured Parties under this Agreement. The exercise of those
rights shall not make the Secured Parties liable to account as a mortgagee in possession.

 

		13.3	Indulgence

 

Each Secured Party may, at
its discretion, grant time or other indulgence or make any other arrangement, variation or release with any person or persons not
being a party to this Agreement (whether or not such person or persons is jointly liable with the Company) in respect of any of
the Secured Liabilities, or of any other security for them without prejudice either to this Agreement or to the liability of the
Company for the Secured Liabilities.

 

		14	Enforcement and Powers of the Secured Parties

 

		14.1	When Security becomes enforceable

 

The power of sale and other
powers conferred by section 101 of the Law of Property Act 1925 and all other enforcement powers conferred by this Agreement shall
be immediately exercisable at any time after an Event of Default has occurred.

 

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		14.2	Statutory Power of Sale

 

The statutory powers of sale
and other powers conferred by the Law of Property Act 1925 shall, as between a Secured Party and a purchaser from the Secured Parties,
arise on and be exercisable at any time after the execution of this Agreement, but no Secured Party shall exercise such power of
sale until the security constituted by this Agreement has become enforceable.

 

		14.3	Extension of Statutory Powers

 

The statutory powers of leasing
conferred on each Secured Party are extended so as to authorise each Secured Party to lease, make agreements for leases at a premium
or otherwise, accept surrenders or leases and grant options or vary or reduce any sum payable under any leases or tenancy agreements
as the Secured Parties may think fit, without the need to comply with any provision of Section 99 or 100 of the Law of Property
Act 1925.

 

		14.4	Power to Dispose of Chattels

 

At any time after the security
constituted by this Agreement has become enforceable, each Secured Party or any Receiver:

 

		(a)	may dispose of any chattels or produce found on any Property as agent for the Company; and

 

		(b)	without prejudice to any obligation to account for the proceeds of any sale of such chattels or
produce, shall be indemnified by the Company against any liability arising from such disposal.

 

		14.5	Prior Security

 

At any time after the security
constituted by this Agreement has become enforceable, or after any powers conferred by any Security having priority to this Agreement
shall have become exercisable, each Secured Party may:

 

		(a)	redeem such or any other prior Security, or procure its transfer to itself; and

 

		(b)	settle any account of the holder of any prior Security.

 

		14.6	Any accounts so settled and passed shall be, in the absence of
manifest error, conclusive and binding on the Company. All monies paid by a Secured Party to prior security holder in settlement
of such an account shall, as from its payment by the relevant Secured Party, be due from the Company to the Secured Parties on
current account and be secured as part of the Secured Liabilities.

 

		14.7	Right of appropriation

 

To the extent that the Charged
Assets constitute Financial Collateral and this Agreement and the obligations of the Company hereunder constitute a Security Financial
Collateral Arrangement, each Secured Party shall have the right, at any time after the security constituted this Agreement has
become enforceable, to appropriate all or any of the Charged Assets in or towards the payment and/or discharge of the Secured Liabilities
in such order as that Secured Party in its absolute discretion may from time to time determine. The value of any Charged Asset
appropriated in accordance with this clause shall be the price of that Charged Asset at the time the right of appropriation is
exercised as listed on any recognised market index, or determined by such other method as that Secured Party may select (including
independent valuation). The Company agrees that the methods of valuation provided for in this clause are commercially reasonable
for the purposes of the Financial Collateral Regulations.

 

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		14.8	Restrictions

 

Section 103 of the Law of Property
Act 1925 (restricting the power of sale) and Section 93 of the Law of Property Act 1925 (restricting the right of consolidation)
do not apply to the security constituted by this Agreement.

 

		14.9	No Liability as Mortgagee in Possession

 

Neither the Secured Parties,
nor any Receiver nor any Administrator shall be liable to account as mortgagee in possession in respect of all or any of the Charged
Assets, nor shall any of them be liable for any loss on realisation of, or for any neglect or default of any nature in connection
with, all or any of the Charged Assets for which a mortgagee in possession might be liable as such.

 

		14.10	Protection of Third Parties

 

No purchaser, mortgagee or
other person dealing with a Secured Party or any Receiver shall be concerned:

 

		(a)	to enquire whether any of the Secured Liabilities have become due or payable, or remain unpaid
or undischarged, or whether the power the relevant Secured Party or a Receiver is purporting to exercise has become exercisable;
or

 

		(b)	to see to the application of any money paid to the relevant Secured Party or any Receiver.

 

		15	Receiver

 

		15.1	Appointment of Receiver

 

		15.1.1	At any time after the security constituted by this Agreement has become enforceable, or at the
request of the Company, each Secured Party may, without further notice:

 

		(a)	appoint by way of deed, or otherwise in writing, any one or more person or persons to be a receiver,
or a receiver and manager, of all or any part of the Charged Assets; and

 

		(b)	(subject to section 45 of the Insolvency Act 1986) from time to time, by way of deed, or otherwise
in writing, remove any person appointed to be Receiver and may, in a similar manner, appoint another in his place.

 

Where more than one person
is appointed Receiver, they shall have power to act separately (unless the appointment by the Secured Party specifies to the contrary).

 

		15.1.2	The relevant Secured Party may fix the remuneration of any Receiver appointed by it without the
restrictions contained in section 109 of the Law of Property Act 1925 and the remuneration of the Receiver shall be a debt secured
by this Agreement which shall be due and payable immediately upon its being paid by the relevant Secured Party.

 

		15.2	Agent of the Company

 

Any Receiver appointed by a
Secured Party under this Agreement shall be the agent of the Company and the Company shall be solely responsible for his acts and
remuneration, as well as for any defaults committed by him.

 

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		16	Powers of Receiver

 

		16.1	Powers of Receiver

 

Any Receiver appointed by a
Secured Party under this Agreement shall, in addition to the powers conferred on him by the Law of Property Act 1925 and the Insolvency
Act 1986, have the power to do all such acts and things as an absolute owner could do in the management of such of the Charged
Assets over which the Receiver is appointed and, in particular, a Receiver may:

 

		(a)	undertake or complete any works of repair, building or development on the Properties;

 

		(b)	grant, or accept surrenders of, any leases or tenancies affecting the Properties on such terms
and subject to such conditions as he thinks fit;

 

		(c)	provide services and employ, or engage, such managers, contractors and other personnel and professional
advisors on such terms as he deems expedient;

 

		(d)	make such elections for value added tax purposes as he thinks fit;

 

		(e)	charge and receive such sum by way of remuneration (in addition to all costs, charges and expenses
incurred by him) as the Secured Parties may prescribe or agree with him;

 

		(f)	collect and get in the Charged Assets or any part of it in respect of which he is appointed and
make such demands and take such proceedings as may seem expedient for that purpose, and to take possession of the Charged Assets
with like rights;

 

		(g)	carry on, manage, develop, reconstruct, amalgamate or diversify or concur in carrying on, managing,
developing, reconstructing, amalgamating or diversifying the business of the Company;

 

		(h)	grant options and licences over all or any part of the Charged Assets, sell or concur in selling,
assign or concur in assigning, lease or concur in leasing and accept or concur in accepting surrenders of leases of, all or any
of the property of the Company in respect of which he is appointed in such manner and generally on such terms and conditions as
he thinks fit (fixtures and plant and machinery may be severed and sold separately from the premises in which they are contained
without the consent of the Company), and to carry any such sale, assignment, leasing or surrender into effect. Any such sale may
be for such consideration as the Receiver thinks fit and he may promote, or concur in promoting, a company to purchase the property
to be sold;

 

		(i)	sell and assign all or any of the Book Debts in respect of which he is appointed in such manner,
and generally on such terms and conditions, as he thinks fit;

 

		(j)	make any arrangement, settlement or compromise between the Company and any other person which he
may think expedient;

 

		(k)	make substitutions of, or improvements to, the Equipment as he may think expedient;

 

		(l)	make calls conditionally or unconditionally on the members of the Company in respect of the uncalled
capital with such and the same powers for that purpose, and for the purpose of enforcing payments of any calls so made, as are
conferred by the Articles of Association of the Company on its directors in respect of calls authorised to be made by them;

 

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		(m)	appoint managers, officers, servants, workmen and agents for the purposes of this Clause 16 at
such salaries, for such periods and on such terms as he may determine;

 

		(n)	if he thinks fit, but without prejudice to the indemnity in Clause 19, effect with any insurer
any policy of insurance either in lieu or satisfaction of, or in addition to, such insurance;

 

		(o)	exercise all powers provided for in the Law of Property Act 1925 in the same way as if he had been
duly appointed under that act, and exercise all powers provided for an administrative receiver in Schedule 1 of the Insolvency
Act 1986;

 

		(p)	for any of the purposes authorised by this Clause 16 raise money by borrowing from the Secured
Parties (or from any other person) on the security of all or any of the Charged Assets in respect of which he is appointed on such
terms as he shall think fit (including, if the Secured Parties consents, terms under which such security ranks in priority to this
Agreement);

 

		(q)	redeem any prior Security and settle and pass the accounts to which the Security relates. Any accounts
so settled and passed shall be conclusive and binding on the Company, and the monies so paid shall be deemed to be an expense properly
incurred by him; and

 

		(r)	do all such other acts and things as he may consider incidental or conducive to any of the matters
or powers in this Clause 16, or which he lawfully may or can do as agent for the Company.

 

		16.2	Scope of powers

 

Any exercise of any of the
powers given by this Clause 16 may be on behalf of the Company, the directors of the Company (in the case of the power contained
in paragraph (l) of this Clause 16) or himself.

 

		17	Application of Monies

 

		17.1	Each Secured Party hereby acknowledges and agrees that, notwithstanding the time or order of any
registration document with respect to the Charged Assets and the Security constituted under this Agreement, or other applicable
law, solely as amongst the Secured Parties, the separate Security of the Secured Parties with respect to the Charged Assets shall
have the same rank and priority provided, that, the foregoing shall not apply to any Security of a Secured Party that is void or
voidable as a matter of law.

 

		17.2	All monies received by any Secured Party or a Receiver in the exercise of any enforcement powers
conferred by this Agreement shall be applied:

 

		(a)	first, ratably in paying all unpaid fees, costs and other liability incurred by or on behalf of
any of the Secured Parties (and any Receiver, attorney or agent appointed by them) or indemnities then due to any of the Secured
Parties under the Transaction Documents, until paid in full;

 

		(b)	second in paying the remuneration of any Receiver (as agreed between the Receiver and the Secured
Parties);

 

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		(c)	third, ratably to pay any fees or premiums then due to any of the Secured Parties under the Transaction
Documents, until paid in full; and

 

		(d)	fourth, ratably to pay the principal amount of all Secured Liabilities then due to any of the Secured
Parties, until paid in full;

 

		(e)	fifth, ratably to pay any other Secured Liabilities then due to any of the Secured Parties; and

 

		(f)	sixth, the surplus to the Company or such other person entitled thereto under applicable law.

 

		17.3	Suspense Account

 

All monies received by the
Secured Parties or a Receiver under this Agreement may, at the discretion of the Secured Parties or Receiver, be credited to any
suspense or securities realised account and shall bear interest at such rate, if any, as may be agreed in writing between the Secured
Parties and the Company, and may be held in such account for so long as the Secured Parties or Receiver think fit.

 

		18	Power of Attorney

 

		18.1	Appointment and Powers

 

By way of security, the Company
irrevocably appoints each Secured Party and every Receiver separately to be the attorney of the Company and, in its name, on its
behalf and as its act and deed, to execute any documents and do any acts and things which:

 

		(a)	the Company is required to execute and do under this Agreement, including execute any document
required by any Secured Party under Clause 4 (Perfection of Security); and/or

 

		(b)	any attorney may reasonably deem proper or desirable in exercising any of the powers, authorities
and discretions conferred by this Agreement or by law on the Secured Parties or any Receiver.

 

		18.2	Ratification of Acts of Attorney

 

The Company ratifies and confirms,
and agrees to ratify and confirm, anything which any of its attorneys may do in the proper and lawful exercise of all or any of
the powers, authorities and discretions referred to in sub-clause 18 of this Clause 18 .

 

		18.3	Appointment of an Administrator

 

		18.3.1	Any Secured Party may, without notice to the Company, appoint any one or more persons to be an
administrator of the Company pursuant to Paragraph 14 Schedule B1 of the Insolvency Act 1986 if this Agreement becomes enforceable.

 

		18.3.2	Any appointment under this Clause 18.3. shall:

 

		(a)	be in writing signed by a duly authorised signatory of the relevant Secured Party; and

 

		(b)	take effect, in accordance with paragraph 19 of Schedule B1 of the Insolvency Act 1986, when the
requirements of paragraph 18 of that Schedule B1 are satisfied.

 

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		18.4	Each Secured Party may (subject to any necessary approval from
the court) end the appointment of an Administrator by notice in writing in accordance with this Clause 18.3 and appoint a replacement
for any Administrator whose appointment ends for any reason under that paragraph.

 

		19	Restriction

 

		19.1	Notwithstanding anything in this Agreement to the contrary, each Secured Party agrees that it will
not exercise any remedy provided for under this Agreement with respect to all or any portion of the Charged Assets unless such
Secured Party is a Permitted Secured Party (provided that the foregoing shall not prevent any Secured Party from commencing or
participating in any Insolvency Proceeding or taking any action (other than with respect to the Charged Assets) to enforce the
payment or performance of any Grantors’ obligations under any of the Notes, Guaranties or other Transaction Documents (each
term as defined in the Securities Purchase Agreement).

 

		19.2	This Clause 19 is not intended to confer any rights or benefits upon the Company or any other person
except Secured Parties, and no person other than Secured Parties shall have any right to enforce any of the provisions of this
Clause 19. As between the Company and any Secured Party, any action that such Secured Party may take under this Agreement shall
be conclusively presumed to have been authorised and approved by the other Secured Parties.

 

		20	Relationship between Secured Parties

 

		20.1	Each Secured Party hereby agrees and acknowledges that no other Secured Party has agreed to act
for it as an administrative or collateral agent, and each Secured Party is and shall remain solely responsible for the attachment,
perfection and priority of all Security created by this Agreement or any other Security Document in favour of such Secured Party.

 

		20.2	No Secured Party shall have by reason of this Agreement or any other Transaction Document an agency
or fiduciary relationship with any other Secured Party.

 

		20.3	No Secured Party (which term, as used in this sentence, shall include reference to each Secured
Party’s officers, directors, employees, attorneys, agents and affiliates and to the officers, directors, employees, attorneys
and agents of such Secured Party’s affiliates) shall: (i) have any duties or responsibilities except those expressly set
forth in this Agreement and the other Security Documents or (ii) be required to take, initiate or conduct any enforcement action
(including any litigation, foreclosure or collection proceedings hereunder or under any of the other Security Documents).

 

		20.4	Without limiting the foregoing, no Secured Party shall have any right of action whatsoever against
any other Secured Party as a result of such Secured Party acting or refraining from acting hereunder or under any of the Security
Documents except as a result and to the extent of losses caused by such Secured Party’s actual gross negligence or willful
misconduct (it being understood and agreed by each Secured Party that the delivery by any Significant Secured Party of one or more
Veto Notices shall not be deemed to be or construed as gross negligence or willful misconduct on the part of the Secured Party
delivering any such Veto Notice).

 

		20.5	No Secured Party assumes any responsibility for any failure or delay in performance or breach by
the Company or any Secured Party of its obligations under this Agreement or any other Transaction Document.

 

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		20.6	No Secured Party makes to any other Secured Party any express or implied warranty, representation
or guarantee with respect to any Secured Liabilities, Charged Assets, Transaction Document or the Company.

 

		20.7	No Secured Party nor any of its officers, directors, employees, attorneys or agents shall be responsible
to any other Secured Party or any of its officers, directors, employees, attorneys or agents for: (i) any recitals, statements,
information, representations or warranties contained in any of the Transaction Documents or in any certificate or other document
furnished pursuant to the terms hereof; (ii) the execution, validity, genuineness, effectiveness or enforceability of any of the
Transaction Documents; (iii) the validity, genuineness, enforceability, collectability, value, sufficiency or existence of any
Charged Asset or the Security constituted thereover in this Agreement, or the attachment, perfection or priority of any Security
therein; or (iv) the assets, liabilities, financial condition, results of operations, business, creditworthiness or legal status
of the Company.

 

		20.8	No Secured Party nor any of its officers, directors, employees, attorneys or agents shall have
any obligation to any other Secured Party to ascertain or inquire into the existence of any default or Event of Default, the observance
or performance by any Grantor of any of the duties or agreements of such Grantor under any of the Transaction Documents or the
satisfaction of any conditions precedent contained in any of the Transaction Documents.

 

		21	Costs and Indemnity

 

		21.1	Costs

 

The Company shall pay to, or
reimburse, the Secured Parties and any Receiver on demand, on a full indemnity basis, all Costs incurred by any Secured Party and/or
any Receiver in relation to:

 

		(a)	protecting, perfecting, preserving or enforcing (or attempting to do so) any of the Secured Parties'
or Receiver's rights under this Agreement; or

 

		(b)	suing for, or recovering, any of the Secured Liabilities,

 

(including, without limitation,
the Costs of any proceedings in relation to this Agreement or the Secured Liabilities). Such Costs shall be secured as part of
the Secured Liabilities.

 

		21.2	Indemnity

 

Each Secured Party and any
Receiver, and their respective employees and agents, shall be indemnified on a full indemnity basis out of the Charged Assets in
respect of all actions, liabilities and Costs incurred or suffered in or as a result of:

 

		(a)	the exercise, or purported exercise, of any of the powers, authorities or discretions vested in
them under this Agreement;

 

		(b)	any matter or thing done, or omitted to be done, in relation to the Charged Assets under those
powers; or

 

		(c)	any default or delay by the Company in performing any of its obligations under this Agreement,

 

except
to the extent that the same arises from the misconduct or negligence of that Secured Party or Receiver.

 

    	23

    	 

    

  

		22	Release

 

Subject to Clause 27.3, on
the expiry of the Security Period (but not otherwise), each Secured Party shall, at the request and cost of the Company, take whatever
action is necessary to release the Charged Assets from the security constituted by this Agreement.

 

		23	Assignment and Transfer

 

		23.1	Assignment by Secured Parties

 

At any time, without the consent
of the Company, each Secured Party may assign or transfer the whole or any part of that Secured Party's rights and/or obligations
under this Agreement to any person.

 

		23.2	Assignment by Company

 

The Company may not assign
any of its rights, or transfer any of its obligations, under this Agreement or enter into any transaction which would result in
any of those rights or obligations passing to another person.

 

		24	Set-off

 

		24.1	Set-off Rights

 

		24.1.1	Each Secured Party may set off any matured obligation due from the Company (to the extent beneficially
owned by the relevant Secured Party) against any matured obligation owed by that Secured Party to the Company, regardless of the
place of payment, booking branch or currency of either obligation.

 

		24.1.2	If a Secured Party has more than one account for the Company in its books, that Secured Party may
at any time after:

 

		(a)	the security constituted by this Agreement has become enforceable; or

 

		(b)	that Secured Party has received notice of any subsequent Security or other interest affecting all
or any part of the Charged Assets,

 

		24.1.3	transfer, without prior notice, all or any part of the balance standing to the credit of any account
to any other account which may be in debit (but the relevant Secured Party shall notify the Company of the transfer once made).

 

		24.2	Different Currencies

 

Each Secured Party may exercise
its rights under clause 24.1 (Set-off rights) notwithstanding that the amounts concerned may be expressed in different currencies
and each Secured Party is authorised to effect any necessary conversions at a market rate of exchange selected by it.

 

		24.3	Unliquidated Claims

 

If the relevant obligation
or liability is unliquidated or unascertained, each Secured Party may set-off the amount which it estimates (in good faith and
acting reasonably) will be the final amount of that obligation or liability once it becomes liquidated or ascertained.

 

    	24

    	 

    

  

		24.4	No Set Off

 

The Company will pay all amounts
payable under this deed without any set off, counterclaim or deduction whatsoever unless required by law in which event the Company
will pay an additional amount to ensure that the payment recipient receives the amount which would have been payable had no deduction
been required to have been made.

 

		25	New Accounts

 

If any Secured Party receives
notice of any subsequent Security, or other interest, affecting all or part of the Charged Assets, that Secured Party may open
a new account for the Company in that Secured Party's books. No money paid to the credit of the Company in any such new account
shall be appropriated towards, or have the effect of discharging, any part of the Secured Liabilities. If that Secured Party does
not open a new account immediately on receipt of that notice, then, unless that Secured Party gives express written notice to the
contrary to the Company, all payments made by the Company to that Secured Party shall be treated as having been credited to a new
account of the Company and not as having been applied in reduction of the Secured Liabilities, as from the time of receipt of the
relevant notice by that Secured Party.

 

		26	Currency

 

For the purpose of, or pending
the discharge of, any of the Secured Liabilities, each Secured Party may convert any monies received, recovered or realised by
that Secured Party under this Agreement (including the proceeds of any previous conversion under this Clause 26) from their existing
currencies of denomination into such other currencies of denomination as that Secured Party may think fit. Any such conversion
shall be effected at then prevailing spot selling rate of exchange for such other currency against the existing currency. Each
reference in this Clause 26 to a currency extends to funds of that currency and, for the avoidance of doubt, funds of one currency
may be converted into different funds of the same currency.

 

		27	Further Provisions

 

		27.1	Independent security

 

This Agreement shall be in
addition to, and independent of, every other security or guarantee which any of the Secured Parties may hold for any of the Secured
Liabilities at any time. No prior security held by any of the Secured Parties over the whole or any part of the Charged Assets
shall merge in the security created by this Agreement.

 

		27.2	Continuing security

 

		27.2.1	This Agreement shall remain in full force and effect as a continuing security for the Secured Liabilities,
despite any settlement of account, or intermediate payment, or other matter or thing, unless and until the Secured Parties discharge
this Agreement in writing.

 

		27.2.2	No part of the security from time to time intended to be constituted by this Agreement will be
considered satisfied or discharged by any intermediate payment, discharge or satisfaction of any part of the Secured Liabilities.

 

		27.3	Company's Obligations

 

		27.3.1	The obligations of the Company under this Agreement and the Security constituted thereby shall
not be discharged, impaired or otherwise affected by:

 

		27.3.2	any winding-up, dissolution, administration or re-organisation of or other change in any Grantor
or any other person;

 

    	25

    	 

    

 

		27.3.3	any of the Secured Liabilities being at any time illegal, invalid, unenforceable or ineffective;

 

		27.3.4	any time or other indulgence being granted to any Grantor or any other person;

 

		27.3.5	any amendment, variation, waiver or release of any of the Secured Liabilities other than in respect
of a specific waiver or release of the Company by the Secured Parties;

 

		27.3.6	any failure to take or failure to realise the value of any other collateral in respect of the Secured
Liabilities or any release, discharge, exchange or substitution of any such collateral; or

 

		27.3.7	any other act, other than a specific release of the Company by the Secured Parties, event or omission
which but for this provision would or might operate to impair, discharge or otherwise affect the obligations of the Company under
this Agreement.

 

		27.4	Discharge conditional

 

Any release, discharge or settlement
between the Company and a Secured Party shall be deemed conditional on no payment or security received by that Secured Party in
respect of the Secured Liabilities being avoided, reduced or ordered to be refunded pursuant to any law relating to insolvency,
bankruptcy, winding-up, administration, receivership or otherwise. Despite any such release, discharge or settlement:

 

		(a)	each Secured Party or it nominee may retain this Agreement and the security created by or pursuant
to it, including all certificates and documents relating to the whole or any part of the Charged Assets, for such period as that
Secured Party in its reasonable opinion deems necessary to provide that Secured Party with security against any such avoidance,
reduction or order for refund; and

 

		(b)	each Secured Party may recover the value or amount of such security or payment from the Company
subsequently as if such release, discharge or settlement had not occurred.

 

		27.5	Certificates

 

A certificate or determination
by a Secured Party as to any amount for the time being due to it from the Company shall (in the absence of any manifest error)
be conclusive evidence of the amount due.

 

		27.6	Rights cumulative

 

The rights and powers of each
Secured Party conferred by this Agreement are cumulative, may be exercised as often as the relevant Secured Party considers appropriate,
and are in addition to its rights and powers under the general law.

 

		27.7	Waivers

 

Any waiver or variation of
any right by the Secured Parties (whether arising under this Agreement or under the general law) shall only be effective if it
is in writing and signed by the Secured Parties and applies only in the circumstances for which it was given, and shall not prevent
the Secured Parties from subsequently relying on the relevant provision.

 

    	26

    	 

    

  

		27.8	Liability not discharged

 

The Company's liability under
this Agreement in respect of any of the Secured Liabilities shall not be discharged, prejudiced or affected by:

 

		(a)	any security, guarantee, indemnity, remedy or other right held by, or available to, any of the
Secured Parties that is or becomes wholly or partially illegal, void or unenforceable on any ground;

 

		(b)	any of the Secured Parties renewing, determining, varying or increasing any facility or other transaction
in any manner or concurring in, accepting or varying any compromise, arrangement or settlement, or omitting to claim or enforce
payment from any other person; or

 

		(c)	any other act or omission, which but for this Clause 27.8 might have discharged, or otherwise prejudiced
or affected, the liability of the Company.

 

		27.9	Immediate recourse

 

The Company waives any right
it may have to require any Secured Party to enforce any security or other right, or claim any payment from, or otherwise proceed
against, any other person before enforcing this Agreement against the Company.

 

		27.10	Further exercise of rights

 

No act or course of conduct
or negotiation by or on behalf of any Secured Party shall, in any way, preclude that Secured Party from exercising any right or
power under this Agreement or constitute a suspension or variation of any such right or power, except to the extent such right
or power is waived by the Secured Parties in accordance with Clause 27.7 (Waivers) above.

 

		27.11	Delay

 

No delay or failure to exercise
any right or power under this Agreement shall operate as a waiver.

 

		27.12	Single or partial exercise

 

No single or partial exercise
of any right under this Agreement shall prevent any other or further exercise of that or any other right.

 

		27.13	Partial invalidity

 

The invalidity, unenforceability
or illegality of any provision (or part of a provision) of this Agreement under the laws of any jurisdiction shall not affect the
validity, enforceability or legality of the other provisions. If any invalid, unenforceable or illegal provision would be valid,
enforceable or legal if some part of it were deleted, the provision shall apply with any modification necessary to give effect
to the commercial intention of the parties.

 

		27.14	Counterparts

 

This Agreement may be executed
and delivered in any number of counterparts, each of which is an original and which together have the same effect as if each party
had signed the same document.

 

    	27

    	 

    

  

		28	Notices

 

		28.1	Service

 

Each notice or other communication
required to be given under, or in connection with, this Agreement shall be:

 

		(a)	in writing, delivered personally or sent by pre-paid first-class letter or fax; and

 

		(b)	sent:

 

		(i)	to the Company at:

 

Thames
House

Portsmouth Road

Esher

Surrey

KT10 9AD

United Kingdom

 

Email:
MarkC@pczlaw.com

 

Attention:
Mark Cohen

 

Copy
to:

 

Avram Kelman

Fladgate LLP

16 Great Queen Street

London

WC2B 5DG

United Kingdom

Email: akelman@fladgate.com

 

		(ii)	to Iroquois at:

 

Iroquois
Master Fund Ltd.

641 Lexington Avenue

20th Floor

New York

NY

United States

Attention: Joshua Silverman

 

		(iii)	to Alpha at:

 

Alpha Capital
Anstalt

Pradafant 7

LI-9490

Vaduz

Furstentum

Liechtenstein

 

Attention:
Konrad Acermann

 

or to
such other address or fax number as is notified in writing by one party to the others from time to time.

 

    	28

    	 

    

  

		28.2	Receipt

 

Receipt of any notice given
under Clause 28.1, shall be deemed to be received:

 

		(a)	if given by hand, at the time of actual delivery;

 

		(b)	if posted, on the second Business Day after the day it was sent by pre-paid first-class post; or

 

		(c)	if sent by fax, when received in legible form.

 

A
notice or other communication given as described in Clause 28.2(a) or Clause 28.2(b) on a day which is not a Business Day, or after
normal business hours, in the place it is received, shall be deemed to have been received on the next Business Day.

 

		29	Governing Law and Jurisdiction

 

		29.1	Governing law

 

This Agreement and any dispute
or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims)
shall be governed by and construed in accordance with the law of England and Wales.

 

		29.2	Jurisdiction

 

The parties to this Agreement
irrevocably agree that, subject as provided below, the courts of England and Wales shall have exclusive jurisdiction to settle
any dispute or claim that arises out of or in connection with this Agreement or its subject matter or formation (including non-contractual
disputes or claims).

 

		29.3	Convenient Forum

 

The
parties agree that the courts of England are the most appropriate and convenient courts to settle disputes between them arising
out of, or in connection with, this Agreement and, accordingly, that they will not argue to the contrary.

 

		29.4	Other service

 

Each of the parties to this
Agreement irrevocably consents to any process in any proceedings being served on it in accordance with the provisions of this Agreement
relating to service of notices. Nothing contained in this Agreement shall affect the right to serve process in any other manner
permitted by law.

 

This document has been executed as a deed
and is delivered and takes effect on the date stated at the beginning of it.

 

    	29

    	 

    

 

Schedule
1: Form of Notice of Assignment – Insurance Policies

 

Part A

 

To:[Insurer]

 

Date: [     ]

 

Dear Sirs,

 

We hereby give you notice that we have
assigned to [ ] (Secured Parties) pursuant to a security agreement entered into by us in favour of the Secured Parties dated
[ ] all our right, title and interest in and to the proceeds of [insert details of relevant insurance policy] (Policy of Insurance).

 

With effect from your receipt of this notice
we instruct you to:

 

		1.	make all payments and claims under or arising from the Policy of Insurance to the Secured Parties
[insert account details here if required] or to their order as they may specify in writing from time to time;

 

		2.	note the interest of the Secured Parties on the Policy
of Insurance; and

 

		3.	disclose to any Secured Party, without further approval from us, such information regarding the
Policy of Insurance as any Secured Party may from time to time request and to send it copies of all notices issued by you under
the Policy of Insurance.

 

With effect from your receipt of this notice
all rights, interests and benefits whatsoever accruing to or for the benefit of ourselves arising from the Policy of Insurance
(including all rights to compel performance) belong to and are exercisable by the Secured Parties.

 

Please acknowledge receipt of this notice
by signing the acknowledgement on the enclosed copy letter and returning the same to each Secured Party at [•] marked for
the attention of [ ].

 

Yours faithfully,

 

for and on behalf of

Morria Biopharmaceutricals PLC

 

    	30

    	 

    

 

Part B

 

[On copy only:

 

To:[SECURED PARTIES]

 

We acknowledge receipt of a notice in the
terms set out above and confirm that we have not received notice of any previous assignments or charges of or over any of the rights,
title and interests and benefits referred to in such notice and that we will comply with the terms of that notice.

 

We further confirm that no amendment or
termination of the Policy of Insurance shall be effective unless we have given each Secured Party thirty days written notice of
such amendment or termination.

 

For and on behalf of [                  ]

 

	By:	 	 

 

Dated:

 

    	31

    	 

    

 

Schedule
2: Form of Notice of Assignment – Accounts

 

Part A 

To:[Account Bank]

 

Date: [      ]

 

Dear Sirs,

 

We hereby give you notice that pursuant
to a security agreement dated 2012 (Security Agreement) we have charged to [ ] (Secured Parties) all of our right,
title and interest in and to account number [•], account name [•] (including any renewal or redesignation of such account)
and all monies standing to the credit of that account from time to time (Account).

 

With effect from the date of your receipt
of this notice all rights, interests and benefits whatsoever accruing to or for the benefit of ourselves arising from the Account
belong to the Secured Parties.

 

Upon your receipt of notice from any of
the Secured Parties that an Event of Default (as defined in the Security Agreement) has occurred, any existing payment instructions
affecting the Account are to be terminated and all payments and communications in respect of the Account should be made to the
Secured Parties or to their order.

 

Please accept this notice by signing the
enclosed acknowledgement and returning it to each Secured Party at [ ] marked for the attention of [ ].

 

Yours faithfully 

 

for and on behalf of

 

Morria Biopharmaceutricals PLC

 

    	32

    	 

    

 

Part B

 

[on copy only]

 

To:[SECURED PARTIES]

 

Date:[            ]

 

At the request of the Secured Parties and
Morria Biopharmaceutricals PLC we acknowledge receipt of the notice of assignment and charge, on the terms attached, in respect
of the Account (as described in those terms). We confirm that:

 

		•	the balance standing to the Account at today's date is [•], no fees or periodic charges are
payable in respect of the Account and there are no restrictions on (a) the payment of the credit balance on the Account [(except,
in the case of a time deposit, the expiry of the relevant period)] or (b) the assignment of the Account to the Secured Parties
or any third party;

 

		•	we have not received notice of any previous assignments of, charges over or trusts in respect of,
the Account and we will not, without the consent of the Secured Parties (a) exercise any right of combination, consolidation or
set off which we may have in respect of the Account or (b) amend or vary any rights attaching to the Account; and

 

		•	upon the occurrence of an Event of Default we will act only in accordance with the instructions
given by persons authorised by the Secured Parties and we shall send all statements and other notices given by us relating to the
Account to the Secured Parties.

 

For and on behalf of [•]

 

By:

 

    	33

    	 

    

 

Schedule
3: Intellectual Property

 

PATENTS AND PATENT APPLICATIONS

 

	
        PCZL

        Docket No.
	Serial No.	Inventor(s)	Assignee	
        Filing

        Date
	Status
	
        P-8131-AU

        Australia
	2006278657	PRINCE, Alice; YEDGAR, Saul; COHEN, Yuval	
        Morria Biopharmaceuticals plc (Morria);

        Yissum Research Development Company of the
        Hebrew University (Yissum);

        The Trustees of Columbia University (Columbia
        University)
	01-Aug-2006	Pending
	
        P-8131-CA

        Canada
	2,617,484	YEDGAR, Saul; PRINCE, Alice; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-CN

        China
	200680037016.3	YEDGAR, Saul; PRINCE, Alice; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-EA

        Eurasia
	200800489	PRINCE, Alice; YEDGAR, Saul; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-EP

        Europe
	06800600.6	PRINCE, Alice; YEDGAR, Saul; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-IL

        Israel
	189171	PRINCE, Alice; YEDGAR, Saul; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending

 

    	34

    	 

    

 

	
        PCZL

        Docket No.
	Serial No.	Inventor(s)	Assignee	
        Filing

        Date
	Status
	
        P-8131-JP

        Japan
	2008-525110	PRINCE, Alice; YEDGAR, Saul; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-KR

        Korea
	10-2008-7005229	YEDGAR, Saul; PRINCE, Alice; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-MX

        Mexico
	MX/a2008/001639	PRINCE, Alice; YEDGAR, Saul; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Pending
	
        P-8131-PC

        International
	PCT/US06/29893	YEDGAR, Saul; PRINCE, Alice; COHEN, Yuval	Morria; Yissum; Columbia University	01-Aug-2006	Expired
	
        P-8131-USP

        United States
	60/704,874	YEDGAR, Saul;	Morria	03-Aug-2005	Expired
	
        P-8967-AU

        Australia
	2007320737	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-8967-AU1

        Australia
	2007320736	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-8967-CA1

        Canada
	2,705,785	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-8967-CN1

        China
	200780049831.6	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-8967-EP

        Europe
	07827381.0	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-8967-EP1

        Europe
	07827380.2	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending

 

    	35

    	 

    

 

	
        PCZL

        Docket No.
	Serial No.	Inventor(s)	Assignee	
        Filing

        Date
	Status
	
        P-8967-PC

        International
	PCT/IL2007/001408	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Expired
	
        P-8967-PC1

        International
	PCT/IL2007/001407	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Expired
	
        P-8967-PC2

        International
	PCT/US07/23913	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Expired
	
        P-8967-PC3

        International
	PCT/IB2007/004668	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Expired
	
        P-8967-US

        United States
	11/984,224	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-8967-US1

        United States
	11/984,223	YEDGAR, Saul; COHEN, Yuval	Yissum; Morria	14-Nov-2007	Pending
	
        P-71126-AU

        Australia
	Not yet known	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Pending
	
        P-71126-CA

        Canada
	2,761,590	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Pending
	
        P-71126-CN

        China
	Not yet known	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Pending
	
        P-71126-EP

        Europe
	10775366.7	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Pending

 

    	36

    	 

    

 

	
        PCZL

        Docket No.
	Serial No.	Inventor(s)	Assignee	
        Filing

        Date
	Status
	
        P-71126-IL

        Israel
	216203	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Pending
	
        P-71126-JP

        Japan
	Not yet known	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Pending
	
        P-71126-PC

        International
	PCT/US10/34317	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	11-May-2010	Expired
 

	
        P-71126-US

        United States
	12/997,014	YEDGAR, Saul; COHEN, Yuval; BONDI, Joseph V.	Yissum; Morria	09-Dec-2010	Pending

  

INTELLECTUAL PROPERTY LICENCES

 

	
        Description of

        Intellectual

        Property Licensed
	 	
        Licensor
	 	
        Date of Licence
	 	
        Duration of Licence

	 	 	 	 	 	 	 
	Rights under an exclusive license agreement between Yissum and Morria Biopharmaceutical, Inc. dated 27 November 2002 (Yissum License)	 	Morria Biopharmaceutical, Inc.	 	1 February 2005	 	Terminates upon termination of the Yissum License

 

    	37

    	 

    

 

	Executed
                                                as a Deed by

        Morria
        Biopharmaceuticals PLC acting by a director and its secretary or two directors or a director in the presence
        of a witness who attests his signature:
	)

        )

        )
	 

         

        sign here:
        /s         / YUVAL COHEN

	 

         
	 	Director

        print
        name:  Yuval Cohen

	 

        In
        the presence of:
	 	 

        sign
        here: /s / MARK S. COHEN

	 

         
	 	Director

        print
        name:  Mark S. Cohen

	Witness

        print
        name:
	 	 
	print
                                               address:

         
	 	 
	 

         
	 	 
	profession:	 	 

 

    	38

    	 

    

 

	
        Executed as a Deed by

        Iroquois Master Fund Ltd.

        acting by a director and its secretary
        or two directors or a director in the presence of a witness who attests his signature:
	
        )

        )

        )
	
         

         

         

         

         

         

        sign here:
        /s/ Joshua Silverman

	
         

         
	 	
        Authorized Signatory

        print name:

	
         

         

         

        In the presence of:
	 	
        Joshua Silverman

         

         

        sign here: /s/ Kimberly Page

	
         

        /s/ Kimberly Page
	 	
        Director/Secretary/Witness

        print name:

	
        Witness

        print name: Kimberly Page
	 	 
	
        print address:

        641 Lexington Ave. 26 Floor
	 	 
	
         

        New York, New York, 10022
	 	 
	
        profession: profession: COO

         

         
	 	 

  

 

    	39

    	 

    
 

	Executed
        as a Deed by

        ALPHA
        CAPITAL ANSTALT acting by a director and its secretary or two directors or a director in the presence of a
        witness who attests his signature:
	)

        )

        )
	 

         

        sign here:
        /s/  KONRAD ACKERMAN

	 

         
	 	Director

        print
        name: Konrad Ackerman

	 

        In
        the presence of:
	 	 

        sign
        here:

	 
	 	Director

        print
        name:

	Witness

        print
        name:
	 	 
	print
        address:

         
	 	 
	 

        Notary
	 	 
	profession:	 	 

 

    	40GUARANTY

 

This Guaranty (the
“Guaranty”) is made this 4th day of April 2012, by such guarantors listed on the signature pages
hereof (collectively, jointly and severally, “Guarantors,” and each, individually, a “Guarantor”),
in favor of each of the investors listed on the Schedule of Buyers attached to the Securities Purchase Agreement (as defined herein)
(each, individually, a “Buyer” and together with their respective successors, assigns, endorsees and transferees,
the “Buyers”).

 

RECITALS

 

WHEREAS,
pursuant to the Securities Purchase Agreement, dated as of April 3, 2012 (as amended, restated, supplemented, or otherwise
modified from time to time, including all schedules thereto, the “Securities Purchase Agreement”),
by and among Morria Biopharmaceuticals PLC, a public limited company formed under the laws of England and Wales (“Parent”),
and each of the Buyers, Parent has agreed to sell, and Buyers have each agreed to purchase, severally and not jointly,
certain Notes and Warrants; and

 

WHEREAS, each
Guarantor is a direct or indirect wholly-owned Subsidiary of Parent and will receive direct and substantial benefits from the purchase
by Buyers of the Notes and Warrants; and

 

WHEREAS, in
order to induce Buyers to purchase, severally and not jointly, the Notes and Warrants as provided for in the Securities Purchase
Agreement, Guarantors have agreed to jointly and severally guaranty all of Parent’s obligations under and with respect to
the Notes, the Securities Purchase Agreement and the other Transaction Documents.

 

WHEREAS,
in connection herewith, Morria Biopharmaceuticals, Inc. (“Morria Inc.”), Parent and Buyers have entered
into that certain Security Agreement dated as of April 4, 2012 (as amended, restated, supplemented, or otherwise modified from
time to time, including all schedules thereto, the “Security Agreement”), pursuant to which Morria Inc.
and Parent (Morria Inc. and Parent and any other grantor under the Security Agreement, collectively,
“Obligors” and each, individually, an “Obligor”) have granted each of the Buyers
continuing security interests in all assets of each Obligor, as more fully set forth in the Security Agreement.

 

AGREEMENTS

 

NOW, THEREFORE,
for and in consideration of the recitals made above and other good and valuable consideration, the receipt, sufficiency and adequacy
of which are hereby acknowledged, each Guarantor hereby agrees as follows:

 

1.          Definitions.
All capitalized terms used herein that are not otherwise defined herein shall have the meanings given them in the Securities Purchase
Agreement.

 

    	 

    	 

    

 

2.          Guaranteed
Obligations. Guarantors jointly and severally hereby fully, irrevocably and unconditionally
guaranty to Buyers the due and punctual Satisfaction in Full of the Guaranteed Obligations (as defined below). “Guaranteed
Obligations” means, collectively, all of the present and future payment obligations of each Obligor arising under the
Securities Purchase Agreement, any and all Notes payable to Buyer, the Security Agreement, the UK Security Agreement, and the other
Transaction Documents, including, without limitation, reasonable attorneys’ fees and expenses and any interest, fees, or
expenses that accrue after the filing of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part
as a claim in any Insolvency Proceeding. “Insolvency Proceeding” means any proceeding commenced by or against
any Person under any provision of title 11 of the United States Code, as in effect from time to time (the “Bankruptcy
Code”), or under any other state or federal bankruptcy or insolvency law or any equivalent laws in any other jurisdiction,
assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings
seeking reorganization, arrangement, or other similar relief. 

 

3.          Guarantors’
Representations and Warranties. Each Guarantor represents and warrants to Buyers that
such Guarantor expects to derive substantial benefits from the purchase by Buyers of the Notes and Warrants under the Securities
Purchase Agreement and the other transactions contemplated hereby and by the other Transaction Documents. Buyers may rely conclusively
on a continuing warranty, hereby made, that such Guarantor continues to be benefited by this Guaranty and Buyers shall have no
duty to inquire into or confirm the receipt of any such benefits, and this Guaranty shall be effective and enforceable by Buyers
without regard to the receipt, nature or value of any such benefits.

 

4.          Unconditional
Nature. No act or thing need occur to establish any Guarantor’s liability hereunder,
and no act or thing, except Satisfaction in Full of the Guaranteed Obligations (as defined below), shall in any way exonerate any
Guarantor hereunder or modify, reduce, limit or release any Guarantor’s liability hereunder. This is an absolute, unconditional
and continuing guaranty of payment of the Guaranteed Obligations and shall continue to be in force and be binding upon each Guarantor
until Satisfaction in Full of the Guaranteed Obligations. Each Guarantor agrees that this Guaranty is a guaranty of Satisfaction
in Full of the Guaranteed Obligations and not of collection, and that its obligations under this Guaranty shall be primary, absolute
and unconditional.  In addition to the terms set forth herein, it is expressly understood and agreed that, if, at maturity
and at any time during the continuance of an Event of Default (as defined in the Notes), the outstanding amount of the Guaranteed
Obligations under the Transaction Documents (including, without limitation, all accrued interest thereon, all accrued late charges
thereon and all premiums due in respect thereof) is declared to be immediately due and payable, then Guarantors shall, upon notice
of such acceleration, without further demand, pay to each Buyer the entire outstanding portion of the Guaranteed Obligations that
is due and owing to such Buyer.

 

5.          Subrogation.
No Guarantor will exercise or enforce any right of contribution, reimbursement, recourse or subrogation available to such Guarantor
as to any of the Guaranteed Obligations, or against any Person liable therefor, or as to any collateral security therefor, unless
and until Satisfaction in Full of the Guaranteed Obligations.

 

6.          Enforcement
Expenses. Each Guarantor shall pay or reimburse each Buyer for all costs, expenses
and reasonable attorneys’ fees paid or incurred by such Buyer in endeavoring to collect and enforce the Guaranteed Obligations
and in enforcing this Guaranty.

 

    	2

    	 

    

 

7.          Obligations
Absolute. Each Guarantor agrees that its obligations hereunder are irrevocable, absolute,
independent and unconditional and shall not be affected by any circumstance which constitutes a legal or equitable discharge of
a guarantor or surety other than Satisfaction in Full of the Guaranteed Obligations. In furtherance of the foregoing and without
limiting the generality thereof, each Guarantor agrees that none of its obligations hereunder shall be affected or impaired by
any of the following acts or things (which each Buyer is expressly authorized to do, omit or suffer from time to time, without
consent or approval by or notice to any Guarantor): (a) any acceptance of collateral security, guarantors, accommodation parties
or sureties for any or all of the Guaranteed Obligations; (b) one or more extensions or renewals of the Guaranteed Obligations
(whether or not for longer than the original period) or any modification of the interest rates, maturities, if any, or other contractual
terms applicable to any of the Guaranteed Obligations or any amendment or modification of any of the terms or provisions of any
of the Transaction Documents; (c) any waiver or indulgence granted to Parent or any other Obligor, any delay or lack of diligence
in the enforcement of the Guaranteed Obligations, or any failure to institute proceedings, file a claim, give any required notices
or otherwise protect any of the Guaranteed Obligations; (d) any full or partial release of, compromise or settlement with,
or agreement not to sue, Parent, any other Obligor or any other Person liable in respect of any of the Guaranteed Obligations;
(e) any release, surrender, cancellation or other discharge of any evidence of the Guaranteed Obligations or the acceptance
of any instrument in renewal or substitution therefor; (f) any failure to obtain collateral security (including rights of
setoff) for the Guaranteed Obligations, or to see to the proper or sufficient creation and perfection thereof, or to establish
the priority thereof, or to preserve, protect, insure, care for, exercise or enforce any collateral security; or any modification,
alteration, substitution, exchange, surrender, cancellation, termination, release or other change, impairment, limitation, loss
or discharge of any collateral security; (g) any collection, sale, lease or disposition of, or any other foreclosure or enforcement
of or realization on, any collateral security; (h) any assignment, pledge or other transfer of any of the Guaranteed Obligations
or any evidence thereof; (i) any manner, order or method of application of any payments or credits upon the Guaranteed Obligations;
or (j) a Buyer not being a Permitted Secured Party (as defined in the Security Agreement). Each Guarantor waives any and all defenses
and discharges available to a surety, guarantor or accommodation co-obligor.

 

8.          Waivers
by Guarantors. Each Guarantor waives any and all defenses, claims, setoffs and discharges
of, and/or against, Parent, or any other Obligor or Person (including, without limitation, Buyer), pertaining to the Guaranteed
Obligations, except the defense of discharge by indefeasible satisfaction and discharge in full. Without limiting the generality
of the foregoing, no Guarantor will assert, plead or enforce against any Buyer any defense of waiver, release, discharge or disallowance
in any Insolvency Proceeding, statute of limitations, res judicata, statute of frauds, anti-deficiency statute, fraud, incapacity,
minority, usury, illegality or unenforceability which may be available to Parent or any other Obligor or Person liable in respect
of any of the Guaranteed Obligations, or any setoff available to any Buyer against Parent or any other such Obligor or Person,
whether or not on account of a related transaction. Each Guarantor expressly agrees that such Guarantor shall be and remain liable
for any deficiency remaining after foreclosure of any mortgage or security interest securing the Guaranteed Obligations, whether
or not the liability of Parent or any other Obligor or Person for such deficiency is discharged pursuant to statute or judicial
decision. The liability of each Guarantor shall not be affected or impaired by, and each Guarantor waives and agrees it shall not
at any time insist upon, plead or in any manner claim or take the benefit of, any voluntary or involuntary liquidation, dissolution,
sale or other disposition of all or substantially all of the assets, marshalling of assets and liabilities, any valuation, appraisal,
stay, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or
readjustment of, or other similar event or proceeding affecting, Parent or any of its assets. No Guarantor will assert, plead or
enforce against any Buyer any claim, defense or setoff available to such Guarantor against Parent. Each Guarantor waives presentment,
demand for payment, notice of dishonor or nonpayment and protest of any instrument evidencing the Guaranteed Obligations. Buyers
shall not be required first to resort for payment of the Guaranteed Obligations to Parent or any other Person, or their properties,
or first to enforce, realize upon or exhaust any collateral security for the Guaranteed Obligations, before enforcing this Guaranty.

 

    	3

    	 

    

 

9.          If
Payments Set Aside, etc. If any payment applied by a Buyer to the Guaranteed Obligations
is thereafter set aside, recovered, rescinded or required to be returned for any reason (including, without limitation, the bankruptcy,
insolvency or reorganization of Parent or any other Obligor or Person), the Guaranteed Obligations to which such payment was applied
shall for the purpose of this Guaranty be deemed to have continued in existence, notwithstanding such application, and this Guaranty
shall be enforceable as to such Guaranteed Obligations as fully as if such application had never been made.

 

10.        Additional
Obligation of Guarantors. Each Guarantor’s liability under this Guaranty is
in addition to and shall be cumulative with all other liabilities of such Guarantor to Buyers as guarantor, surety, endorser, accommodation
co-obligor or otherwise of any of the Guaranteed Obligations, without any limitation as to amount.

 

11.        No
Duties Owed by Buyer. Each Guarantor acknowledges and agrees that Buyers (a) have
not made any representations or warranties with respect to, (b) do not assume any responsibility to such Guarantor for, and
(c) have no duty to provide information to such Guarantor regarding, the enforceability of any of the Guaranteed Obligations
or the financial condition of Parent or any other Obligor or Person. Each Guarantor has independently determined the creditworthiness
of Parent and the enforceability of the Guaranteed Obligations and until Satisfaction in Full of the Guaranteed Obligations will
independently, and without reliance on any Buyer, continue to make such determinations.

 

12.        Miscellaneous.

 

(a)          This
Guaranty may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and delivered to the other party. In the event that any
signature is delivered by facsimile transmission or by an e-mail which contains a portable document format (.pdf) file of an executed
signature page, such signature page shall create a valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such signature page were an original thereof. Any party delivering
an executed counterpart of this Guaranty by facsimile or other electronic method of transmission also shall deliver an original
executed counterpart of this Guaranty but the failure to deliver an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Guaranty.

 

    	4

    	 

    

 

(b)          Any
provision of this Guaranty which is prohibited or unenforceable shall be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof in that jurisdiction or affecting the validity or enforceability of such provision
in any other jurisdiction.

 

(c)          Headings
used in this Guaranty are for convenience only and shall not be used in connection with the interpretation of any provision hereof.

 

(d)          The
pronouns used herein shall include, when appropriate, either gender and both singular and plural, and the grammatical construction
of sentences shall conform thereto.

 

(e)          Unless
the context of this Guaranty or any other Transaction Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the terms “includes” and “including” are not limiting,
and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.”
The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this
Guaranty or any other Transaction Document refer to this Guaranty or such other Transaction Document, as the case may be, as a
whole and not to any particular provision of this Guaranty or such other Transaction Document, as the case may be. Section, subsection,
clause, schedule, and exhibit references herein are to this Guaranty unless otherwise specified. Any reference in this Guaranty
or in any other Transaction Document to any agreement, instrument, or document shall include all alterations, amendments, changes,
extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable
(subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set forth herein). “Satisfaction in Full of the Guaranteed Obligations”
shall mean the indefeasible payment in full in cash and discharge, or other satisfaction in accordance with the terms of the Transaction
Documents and discharge, of all Guaranteed Obligations in full. For the avoidance of doubt, the “Satisfaction in Full of
the Guaranteed Obligations” shall be deemed to have occurred upon the indefeasible payment in full and discharge, or other
satisfaction, of (i) the Notes in accordance with their terms and (ii) all other Guaranteed Obligations as of such date.
Any reference herein to any Person shall be construed to include such Person’s permitted
successors and permitted assigns. 

 

(f)          This
Guaranty shall become effective as to each Guarantor upon execution by such Guarantor and delivery to each Buyer, without further
act, condition or acceptance by such Buyer, and shall be binding upon each such Guarantor and the successors and assigns of each
such Guarantor, and shall inure to the benefit of each Buyer and its participants, successors and assigns. This Guaranty may not
be waived, modified, amended, terminated, released or otherwise changed except by a writing signed by each Guarantor and each Buyer.
This Guaranty shall terminate automatically upon the payment in full and discharge, or other satisfaction, of the Notes in accordance
with their terms.

 

    	5

    	 

    

 

(g)          The
language used in this Guaranty will be deemed to be the language chosen by the parties to express their mutual intent, and no rules
of strict construction will be applied against any party. For clarification purposes, the Recitals are part of this Guaranty. 

 

(h)          All
dollar amounts referred to in this Guaranty and the other Transaction Documents (as defined in the Securities Purchase Agreement)
are in United States Dollars (“U.S. Dollars”), and all amounts owing under
this Guaranty and all other Transaction Documents shall be paid in U.S. Dollars. All amounts denominated in other currencies 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 Guaranty, the U.S. Dollar exchange rate as published in the Wall Street Journal on the relevant date of calculation.

 

(i)          Judgment
Currency.

 

(i)          If
for the purpose of obtaining or enforcing judgment against any Guarantor in any court in any jurisdiction it becomes necessary
to convert into any other currency (such other currency being hereinafter in this Section 12(i) referred to as the “Judgment
Currency”) an amount due in U.S. Dollars under this Guaranty or any other Transaction Document, the conversion shall
be made at the Exchange Rate prevailing on the Trading Day (as defined in the Warrant) immediately preceding: (1) the date actual
payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other jurisdiction that
will give effect to such conversion being made on such date or (2) the date on which the foreign court determines, in the case
of any proceeding in the courts of any other jurisdiction (the date as of which such conversion is made pursuant to this Section
12(i)(i) being hereinafter referred to as the “Judgment Conversion Date”).

 

(ii)         If
in the case of any proceeding in the court of any jurisdiction referred to in Section 12(i)(i) above, there is a change in the
Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable
party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted
at the Exchange Rate prevailing on the date of payment, will produce the amount of U.S. Dollars which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment
Conversion Date.

 

(iii)        Any
amount due from any Guarantor under this provision shall be due as a separate debt and shall not be affected by judgment being
obtained for any other amounts due under or in respect of this Guaranty or any other Transaction Document.

 

    	6

    	 

    

 

(j)          Taxes.

 

(i)           Any
and all payments by any Guarantor hereunder or under any other Transaction Document shall be made free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, imposed under any applicable law (collectively referred to as “Taxes”) unless the applicable
Guarantor is required to withhold or deduct any amounts for, or on account of, Taxes pursuant to any applicable law. If such Guarantor
shall be required to withhold or deduct any Taxes from or in respect of any sum payable hereunder to Buyer, (i) the sum payable
shall be increased by the amount by which the sum payable would otherwise have to be increased (the “tax make-whole amount”)
to ensure that after making all required withholdings and deductions (including deductions applicable to the tax make-whole amount)
each Buyer would receive an amount equal to the sum it would have received had no such deductions been made, (ii) such Guarantor
shall make such deductions and (iii) such Guarantor shall pay the full amount withheld or deducted to the relevant governmental
authority within the time required.

 

(ii)          In
addition, each Guarantor agrees to pay to the relevant governmental authority in accordance with applicable law any present or
future stamp or documentary taxes or any other excise or property taxes, charges or similar levies that arise from any payment
made hereunder or in connection with the execution, delivery, registration or performance of, or otherwise with respect to, this
Guaranty and the other Transaction Documents (“Other Taxes”). 

 

(iii)         Each
Guarantor shall deliver to Buyers official receipts, if any, in respect of any Taxes and Other Taxes payable hereunder promptly
after payment of such Taxes and Other Taxes or other evidence of payment reasonably acceptable to Buyer.

 

(iv)         If
a Guarantor fails to pay any amounts in accordance with this Section 12(j), such Guarantor
shall indemnify Buyers within ten (10) calendar days after written demand therefor, for the full amount of any Taxes or Other Taxes,
plus any related interest or penalties, that are paid by Buyers to the relevant governmental authority or other relevant governmental
authority as a result of such failure.

 

(v)          The
obligations of each Guarantor under this Section 12(j) shall survive the termination of this
Guaranty and the Satisfaction in Full of the Guaranteed Obligations.

 

13.         Additional
Guarantors. In accordance with Section 14 of the Note, the Company shall cause each
of its Subsidiaries formed or acquired on or subsequent to the date hereof to become a Guarantor for all purposes of this Guarantee
by executing and delivering an Assumption Agreement in the form of Annex 1
hereto.

 

14.         Notices.
All notices and other communications provided for hereunder shall be given in the form and manner, and delivered to such addresses,
as specified in the Securities Purchase Agreement.

 

    	7

    	 

    

 

15.         Governing
Law; Jurisdiction; Service of Process; Jury Trial. All questions concerning the construction,
validity, enforcement and interpretation of this Guaranty 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. Each Guarantor 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; provided, however, any suit seeking enforcement of this Guaranty may
be brought, at a Buyer’s option, in the courts of any jurisdiction where such Buyer elects to bring such action. Each Guarantor
hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding
by mailing a copy thereof to such party at the address for such notices to it under this Guaranty and agrees that such service
shall constitute good and sufficient service of process and notice thereof. Without limitation of the foregoing, each Guarantor
hereby irrevocably appoints Parent as such Guarantor’s agent for purposes of receiving and accepting any service of process
hereunder. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.
EACH GUARANTOR 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 AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

[signature page follows]

 

    	8

    	 

    

 

IN
WITNESS WHEREOF, this Guaranty has been duly executed by each Guarantor as of the date set
forth above.

 

	 	 	 	MORRIA BIOPHARMACEUTICALS INC., a
	 	 	 	Delaware corporation
	 	 	 	 	 
	 	 	 	By:	/s/ Yuval Cohen
	 	 	 	Name:	Yuval Cohen
	 	 	 	Title:	President
	 	 	 	 	 
	 	 	 	MORRIA BIOPHARM LTD, an Israeli corporation
	 	 	 	 	 
	 	 	 	By:	/s/  Yuval Cohen
	 	 	 	Name:	Yuval Cohen
	 	 	 	Title:	President
	 	 	 	 	 
	Acknowledged and Agreed:	 	 	 
	 	 	 	 	 
	MORRIA BIOPHARMACEUTICALS PLC, a	 	 	 
	public limited company formed under	 	 	 
	the laws of England and Wales	 	 	 
	 	 	 	 	 
	By:	/s/ Yuval Cohen	 	 	 
	Name:	Yuval Cohen	 	 	 
	Title:	President	 	 	 

 

    	9

    	 

    

 

Annex 1 to

 

SUBSIDIARY GUARANTY

 

ASSUMPTION AGREEMENT, dated as of ____
__, ______ made by ______________________________, a ______________ corporation (the “Additional Guarantor”),
in favor of the Buyers pursuant to the Purchase Agreement referred to below. All capitalized terms not defined herein shall have
the meaning ascribed to them in such Purchase Agreement.

 

WITNESSETH:

 

WHEREAS, Morria Biopharmaceuticals
PLC, a public limited company formed under the laws of England and Wales (the “Company”),
and the Buyers have entered into a Securities Purchase Agreement, dated as of March ___, 2012 (as amended, supplemented or otherwise
modified from time to time, the “Purchase Agreement”);

 

WHEREAS, in connection
with the Purchase Agreement, the Subsidiaries of the Company (other than the Additional Guarantor) have entered into the Guaranty,
dated as of March ____, 2012 (as amended, supplemented or otherwise modified from time to time, the “Guaranty”)
in favor of the Buyers;

 

WHEREAS, the Purchase
Agreement requires the Additional Guarantor to become a party to the Guaranty; and

 

WHEREAS, the Additional
Guarantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Guaranty;

 

    	10

    	 

    

 

NOW, THEREFORE, IT IS AGREED:

 

1.          Guaranty.
By executing and delivering this Assumption Agreement, the Additional Guarantor, as provided in Section 13 of the Guaranty, hereby
becomes a party to the Guaranty as a Guarantor thereunder with the same force and effect as if originally named therein as a Guarantor
and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Guarantor
thereunder. The information set forth in this Assumption Agreement is hereby added to the information set forth in the Guaranty.
The Additional Guarantor hereby represents and warrants that each of the representations and warranties contained in Section 3
of the Guaranty is true and correct on and as the date hereof as to such Additional Guarantor (after giving effect to this Assumption
Agreement) as if made on and as of such date.

 

2.          Governing
Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE
OF NEW YORK.

 

    	11

    	 

    

 

IN WITNESS WHEREOF, the undersigned has
caused this Assumption Agreement to be duly executed and delivered as of the date first above written.

 

	 	[ADDITIONALGUARANTOR]
	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

    	12

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