Document:

Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”) is made effective as of November 3, 2017 (the “Effective Date”), by and between ISRAMCO, INC. a Delaware corporation (the “Company”), with its principal operating offices located in Houston, Texas, and EDY FRANCIS (the “Executive”).

W I T N E S S E T H:

WHEREAS, the Company and its affiliated entities (individually and collectively referred to as the “Affiliates”) are involved in the business of exploring for, developing and producing hydrocarbons and operating producing properties in the United States (referred to as the “Business”);

WHEREAS, the Company and Affiliates own, control and have exclusive access to

Confidential Information, as defined below;

WHEREAS, the Company and the Executive are parties to an existing employment agreement pursuant to which Executive serves as the Chief Financial Officer for the Company and the Affiliates;

WHEREAS, the existing employment agreement is terminable at will by Executive; 

WHEREAS, the Executive is willing to continue to perform services for the Company and Affiliates for a specified term, and the Company wishes to ensure that it will retain the services of the Executive for such term; and

WHEREAS, the parties desire to set forth the terms and conditions under which the Executive shall continue to be employed and upon which the Company shall compensate the Executive.

NOW, THEREFORE, in consideration of the premises, the agreements herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:

1.            Employment by Company. Subject to the terms and conditions hereinafter set forth, Company hereby agrees to employ the Executive, and the Executive hereby agrees to serve Company, in the capacity and for the Term of Employment (as defined below) specified herein.

2.            Scope of Employment.  During the Term of Employment hereunder, the Executive will serve as the co-chief executive officer and chief financial officer for the Company and Affiliates. In this connection, the Executive will occupy the top financial position in the Company, report to the Chairman of the Board and the Board of Directors of the Company and will, among other duties, be responsible for:

 

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(i)          Managing all day to day operations of the Company;

(ii)          Implementing the Company’s long and short term goals in conformity with the goals set forth by the Board of Directors;

(iii)         Acting as liaison between the Board and Company management and communicating to the Board on behalf of management;

(iv)         Overseeing all Company accounting practices, including accounting departments, preparing budgets, financial reports, tax and audit functions;

(v)          Directing financial strategy, planning and forecasts; conferring with Chairman of the Board, the president, and the officers of the Company’s parent and related companies;

(vi)         Ensuring compliance with all financial reporting requirements applicable to the

Company, including reports due pursuant to loan covenants and banking requirements;

(vii)        Supervising investment and collection of funds;

(viii)       Providing studies, analysis and reports on trends, opportunities for expansion and projection of future Company growth;

(ix)         Assisting the Company in the creation, maintenance and expansion of favorable relations with banking and other financial partners;

(x)          Using his best efforts to promote the interests and goodwill of Company; and

(xi)         Such other duties and responsibilities, duties and authority reasonably accorded to and expected of the Co-Chief Executive Officer and Chief Financial Officer of the Company and as may, from time - to - time, be assigned by the Chairman of the Board or Board of Directors of the Company.

3.            Engaging in Other Employment. The Executive shall devote his entire productive time, ability, and attention to the business of the Company during the term of this Agreement. The Executive shall not directly or indirectly render any services of a business, commercial, or professional nature to any other persons or organization, whether for compensation or otherwise, without the prior written consent of the Company. Notwithstanding anything herein contained to the contrary, the Executive shall be able to devote such time as he deems reasonably necessary to his own private investments and affairs, so long as the performance of the Executive hereunder is not impaired and the covenants contained herein are not violated.

4.            Compensation.  During the Term of Employment, the Executive shall receive an annual base salary (“Base Salary”) of no less than $110,000 per year. Any increase in the Executive's Base Salary shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The term “Base Salary” as utilized in this Agreement shall refer to the Base Salary as it may be increased. The Base Salary shall payable in accordance with Company’s payroll policy.

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(a)      Bonus. In addition to the Base Salary, Executive shall be eligible for an additional bonus (“Bonus”) and to participate in any profit sharing, option or other similar plan to the extent and on the same basis as is awarded other officers and executives of Company.

 

(b)     Deductions, etc.  All compensation paid to the Executive shall be subject to applicable employment and withholding taxes.

5.            Vacation; Holidays; Sick Leave. During the Term of Employment, the Executive shall be entitled to 21 days of paid leave (“Leave”) and all Company holidays. All Leave not taken prior to calendar year end shall be forfeited. All of the foregoing shall be subject to and taken in accordance with the regular policy of Company.

6.            Business Expenses. The Executive, from time to time, may incur reasonable expenses. Company agrees that during the Term of Employment it will reimburse the Executive for out-of- pocket expenses reasonably incurred by him in connection with the performance of his services hereunder upon the presentation by the Executive of an itemized monthly accounting of such expenditures, including receipts as required or appropriate for federal income tax regulations and such other documentation in support thereof that is adequate in Company’s sole discretion. In addition, Executive shall receive:

(a)      Automobile; Cell Phone To enable the Executive to perform his duties hereunder, which include but are not limited to communication with and visits to the field offices and operating locations of the Company, the Company will provide Executive with the use of a cell phone and an automobile of a make and model selected in the sole discretion of the Company. The Company shall provide insurance and reimburse Executive for maintenance and fuel charges for the automobile.

(b)      Housing. For the Term of Employment, the Company will provide Executive with a housing allowance of $1,700 per month.

(c)      Travel to Israel. The Company will reimburse Executive for the costs of four round trip coach class tickets from Houston, Texas to Tel Aviv, Israel, per year, up to a maximum total amount of $4,000.00 per year.

7.            Executive Benefits During the Term of Employment. The Executive shall, upon the satisfaction of any eligibility requirements with respect thereto, be entitled to participate if he so desires on the same basis as other executives of Company, in Company’s health and dental benefits plans of Company now or hereafter in effect that is made available to the executives of Company. Executive shall additionally, upon satisfaction of any eligibility requirements with respect thereto, immediately be entitled to participate with other executives of Company in any 401(k) plans, retirement plans or arrangements of Company now or hereafter in effect that are made available to the executives of Company. Nothing contained in this Section 7 shall be deemed, interpreted or construed as requiring or obligating Company to provide any fringe benefits to its executives at all, to maintain any currently existing benefits or to procure, obtain or maintain any of the foregoing benefits or any other benefits not currently maintained by Company.

8.            Indemnification/D & O Insurance. The Executive shall be entitled to indemnification with respect to the performance of his duties hereunder on the same terms and conditions as generally

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available to peer executives of the Company.  Moreover, should the Company elect to purchase and provide directors’ and officers’ liability insurance, then Executive shall be entitled to coverage thereunder on the same terms and conditions of such insurance as generally available to peer executives of the Company; provided, however, that it is understood and agreed that the Company is under no obligation to offer, purchase, or provide directors’ and officers’ liability insurance.  The Company's obligations under this Section 8 shall survive the termination of the Term of Employment and this Agreement in accordance with the applicable indemnity policy and directors' and officers' liability insurance maintained by the Company for other officers and directors.

9.            Term of Employment. The “Term of Employment,” as used herein, shall mean a period commencing on November 3, 2017, and shall continue November 2, 2020, unless terminated sooner by Company or by Executive as herein provided. The Term of Employment may be renewed by the mutual agreement of the Company and Executive.

10.          Termination of Employment. The Company may terminate the Term of Employment, but not this Agreement, for any reason, or for “Cause,” or the death or “Permanent Disability” of Executive upon 120 days prior written notice (the “Required Notice”). The Executive may terminate the Term of Employment only for “Good Reason,” upon the Required Notice. For purposes of this Agreement,

(a)          Definition of “Cause.” “Cause” means:

(i)        The commission by the Executive of an act constituting a dishonest or other act of misconduct, or a fraudulent act or a felony under the laws of any state or of the United States to which Company or Executive is subject to;

(ii)          The material breach by the Executive of any of the provisions of this

Agreement; Company that remains uncured after fifteen (15) days written notice thereof;

(iii)   The Executive’s violation of rules governing Executive performance, including, without limitation, any rules, regulations or statements now or hereafter set forth by Company, which violation remains uncured after fifteen (15) days written notice thereof; or

(iv)     Actions by Executive which are designed or intended to be harmful to the interests of Company or Company’s customers or damage the Company’s reputation or goodwill in the conduct of its business or valuation by the financial markets, or which would reasonably be anticipated to have such effect.

(b)       Definition of “Permanent Disability.” “Permanent Disability” means a disability by reason of the occurrence of an injury or disease (including a mental illness) or a physical or mental condition that (i) results in a person becoming unable adequately to perform his or her customary duties for the Company, and (ii) has existed for a continuous period of at least fourteen (14) consecutive weeks, during the last ten (10) weeks of which time such person has been unable to average in excess of twenty (20) hours per week of the type of work for which such person is employed by the Company.  In determining whether a Member is Permanently Disabled, the

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Company may rely upon the opinion of any doctor licensed to practice medicine who has been selected by the Company, and any other evidence the Company deems appropriate. The Company shall be the sole judge as to whether a Member is Permanently Disabled as defined herein, and its judgment shall be binding and conclusive.

(c)          Definition of Good Reason.  “Good Reason” shall mean any one of the following without the consent of the Executive:

(i)          A demotion or any action by the Company which results in diminution of Executive’s position, authority, duties or responsibilities (other than any insubstantial action not taken in bad faith and which is promptly remedied by the Company upon notice by you);

(ii)           A requirement that you report to work more than 60 miles from the Company's existing headquarters (not including normal business travel required of your position);

(iii)          A reduction in your base salary or benefits (unless, in the case of a reduction in benefits only, such reduction in benefits applies to all officers of the Company);

(iv)          A material breach by the Company of its obligations hereunder which is not cured within thirty (30) days following written notice to the Company by you; or

(v)          Any failure by a successor to the Company to assume and agree to perform the

Company's obligations hereunder.

(d)      Definition of Severance Payment. The “Severance Payment” shall mean a payment equal to fifteen months of Base Salary.

(e)      Effect of Termination.

(i)       Termination by Company for Cause; Permanent Disability or Death. In the event the Company terminates Executive’s employment for Cause, Permanent Disability, or Death:

(a)      The Company will pay Executive his Base Salary on a pro rata basis through the effective time of termination along with all unreimbursed expenses, subject to and in accordance with Section 6;

(b)    The Company’s obligation to make any other payments shall immediately terminate; and

(c)      The provisions of Sections 11 and 20 will remain in force according to their terms.

(ii)       Termination by Company without Cause, Death or Permanent Disability; Termination by Executive for Good Reason.  If this Agreement is terminated by Company without Cause, or the death or Permanent Disability of Executive, or by Executive for Good

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Reason, the Executive shall be paid his Base Salary on a pro rata basis and all other payments required hereunder until the effective date of termination. Commencing upon the effective date of termination, the Executive will receive the Severance Payment. In either event, the Company will pay Executive unreimbursed expenses, subject to and in accordance with Section 6, and the provisions of Sections 11 and 20 will remain in force according to their terms.

(iii)      Termination Without Required Notice. In the event the Company terminates this Agreement for any reason, other than death of Executive, without the Required Notice, the Executive shall be paid a sum equal to one hundred percent (100%) of the Executive’s Base Salary plus the value of all other benefits for the period equal to the Required Notice period, less the actual notice given by the Company. This payment shall be in addition to any Severance Payment and other payments to which Executive is entitled hereunder. In the event the Executive terminates this Agreement without the Required Notice, the Executive will receive no payments for the period equal to the Required Notice period, less the actual notice given by the Executive.

(iv)    Non-Renewal. In the event the Company determines not to renew the employment of Executive at the end of the Term of Employment on at least, the same terms as those specified herein, the Executive will receive the Severance Payment. If, after receipt of a written offer to renew the employment of Executive at the end of the Term of Employment on at least the same terms as those specified herein from the Company, the event Executive determines not to renew his Term of Employment, Executive will receive no Severance Payment.

(d)      Return of Property. All computers, equipment, files, records, documents, drawings, presentations, specifications, equipment, data, computer printouts, records, written materials and similar items relating to the business of the Company, whether prepared by the Executive or otherwise coming into his possession shall remain the exclusive property of the Company and shall be returned to the premises of the Company at the termination of employment termination or whenever requested by the Company. In the event the Executive fails to return the Company’s property when required or requested to do so, the Company may, in addition to any other remedy provided by law, withhold any amounts due the Executive until full compliance with this Section 10(d).

11.          Non - Disclosure Covenants. The Executive hereby acknowledges that during the course of his employment, he will have access to and will become familiar with the confidential information of the Company and its business, including, without limitation, financial information, personnel information, lists of vendors, investors, partners and accounts, internal corporate information relating to the Company and its Related Entities, revenue information, information on prospective acquisitions and sales, leasing information, production and geologic information, seismic and geophysical information and such other information of a confidential nature which must remain confidential for the continuing success of the Company (the “Confidential Information”). Additionally, the Executive acknowledges that the Company's methods of doing business and the Confidential Information, as they may exist from time to time, are valuable, special and unique assets of the Company's business. Therefore, in consideration of the mutual promises herein contained, and

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for other good and valuable consideration, to protect the foregoing valuable property of the Company, the Company and the Executive expressly covenant and agree as follows:

(a)      Non - Disclosure. The Executive will not, during and after the termination of his employment for any reason:

(i)       Disclose, directly or indirectly, the Company's methods of doing business or Confidential Information, or any part thereof, to any person, firm, corporation, association or other entity for any reason or purpose whatsoever, unless such disclosure is done in the normal course of Executive's business for Company or on behalf of the Company with Company's consent; or

(ii)     Directly or indirectly use the Company's methods of doing business or Confidential Information, or any part thereof, for his own purpose or for his own benefit in any activity of any nature whatsoever.

(b)          Acknowledgements. The parties acknowledge:

(i)       That due to the nature of the Company's business, the foregoing covenants contain limitations as to scope of activity to be restrained that are reasonable and do not impose a greater restraint upon the Executive than is reasonably necessary to protect the goodwill or other business interests of the Company;

(ii)      That these covenants protect a legitimate interest of the Company and do not serve solely to limit the Company's future competition or the Executive’s ability to find employment;

(iii)          That this Agreement is not an invalid or unreasonable restraint of trade;

(iv)     That a breach of Section 11 of this Agreement by the Executive would cause irreparable damage to the Company; and

(v)      That the signing of this Agreement is necessary to the Executive's employment by the Company.

(c)      Remedies. In the event of any breach, or of any threatened or attempted breach by the Executive of the covenants herein contained, it is agreed that in addition to all other legal remedies, Executive agrees that Company shall be entitled to a temporary restraining order, preliminary injunction and/or permanent injunction restraining and enjoining Executive from violating the provisions herein without the requirement to post a bond. The Executive further agrees that for the purpose of any such injunction proceeding, it shall be presumed that the Company's legal remedies would be inadequate and that the Company would suffer irreparable harm because of the Executive's violation of the provisions of this Agreement. In any proceeding brought by the Company to enforce the provisions of this Agreement, no other matter relating to the terms of any claim or cause of action

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of the Executive against the Company will be a defense thereto. Nothing in this Agreement shall be construed to prohibit Company from pursuing any other available remedies for such breach or threatened breach, including the recovery of damages from Executive. If the Executive breaches any of the terms of this Agreement, then Executive shall pay to Company all of Company’s costs and expenses, including attorneys’ fees, incurred by Company in enforcing the terms of this Agreement.

(d)      Judicial Modification. The Company and the Executive further agree that, should the legality or enforceability of the covenants ever be challenged and any part thereof be deemed unreasonably excessive, the Court rendering such decision shall not invalidate the covenants in their entirety, but rather shall reduce the scope thereof to what the Court deems reasonable under the circumstances.

(e)      Authorization to Notify. Executive hereby authorizes Company to notify third parties about Company’s rights and obligations under this Agreement following the termination of the Agreement.

12.          Representations and Warranties of Executive. In addition to the representations and warranties contained in other Sections of this Agreement, and in any other agreements executed by the parties hereto, the Executive makes the following representations and warranties which shall be true and correct as of the date hereof and which will survive the date hereof:

(a)      The Executive is free to enter into this transaction and that there are no agreements that are in full force and effect which prohibit or limit the full effectiveness of the matters and obligations herein stated;

(b)          All information furnished to the Company or its agent is true and correct;

(c)      There are no actions or proceedings pending or threatened against the Executive which may affect his ability to perform hereunder; and

(d)          No special consents are required to carry out the transaction contemplated by this

Agreement.

13.          Obligation to Return Bonus or Other Incentive- or Equity-Based Compensation. If the Corporation is required to prepare an accounting restatement to correct an accounting error on an interim or annual financial statement included in a report on Form l0-Q or Form 10-K, due to material noncompliance with any financial reporting requirement under the federal securities laws as a result of misconduct, Executive agrees that he shall return:

(a)      Any bonus and other executive or incentive based compensation as provided in Section 304 of the Sarbanes-Oxley Act of 2002, received for or during each of the restated periods and the 12-months immediately preceding each of the restated periods, if any; and

(b)      Any net profits realized by the Executive from sales or other transactions in securities of the Corporation during each of the restated periods and the 12-months immediately preceding each of the restated periods.

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14.          Third-Party Beneficiaries. The Company and the Executive acknowledge and agree that the term “Company” as used in this Agreement shall, for purposes of Executive’s covenants and obligations hereunder, include not only the Company but also its parent, sister, or any other related affiliates or subsidiaries, presently existing or subsequently formed, or any other entity which is a shareholder of the Company or has any of the same shareholders of the Company (collectively, the "Related Entities") and such Related Entities are third-party beneficiaries of the covenants contained in this Agreement. It is further agreed by the Executive that the Company and the Related Entitles may jointly or severally enforce the covenants contained in Sections 11, 13 or 20 hereof.

15.          Severability. Executive acknowledges and agrees that each agreement and covenant set forth herein constitutes a separate agreement independently supported by good and adequate consideration and that each such agreement shall be severable from the other provisions of this Agreement and shall survive this Agreement. Executive understands and agrees that this Agreement is to be enforced to the fullest extent permitted by law. In the event that any of the provisions of this Agreement are held to be too broad to be enforced as written or otherwise invalid or unenforceable in whole or in part, those provisions to the extent enforceable and all other provisions shall nevertheless continue to be valid and enforceable as though the invalid or unenforceable parts had not been included in this Agreement. In the event that any provision relating to the time period or scope of a restriction shall be declared by a court of competent jurisdiction to exceed the maximum time period or scope such court deems reasonable and enforceable, then the time period or scope of the restriction deemed reasonable and enforceable by the court shall become and shall thereafter be the maximum time period or the applicable scope of the restriction. If, however, any provision is held to be illegal, invalid or unenforceable under present or future law, and not subject to reformation, then (i) such provision shall be fully severable, (ii) this Agreement shall be construed and enforced as if such provision was never a part of this Agreement and (iii) the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance.

16.          Legal Fees and Expenses.  In the event that either of the parties to this Agreement contests the validity or enforceability of any of the provisions of Sections 11 or 20, then such contesting party hereby agrees to pay in a timely and prompt manner any and all legal fees and expenses incurred by the other party from time to time as a result of such contesting party’s contesting of the validity or enforceability of any provision of Sections 11 or 20 hereof this Agreement; provided, however, nothing contained in this Section 16 shall obligate Company to pay any legal fees or expenses incurred by the Executive in connection with any litigation by Company against the Executive to enforce the terms of this Agreement against the Executive.

17.           Assignment. The rights and benefits of the Company under this Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company. This Agreement is a personal employment contract and the rights and interests of the Executive hereunder may not be sold, transferred, assigned, pledged, or hypothecated, directly or indirectly, or by operation of law or otherwise.

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18.          Entire Agreement. This Agreement sets forth the entire agreement and understanding between the parties relating to the subject matter hereof and supersedes and merges all prior agreements and discussions between the parties. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the party to be charged. Any subsequent change or changes in Executive’s duties, salary or compensation will not affect the validity or scope of this Agreement.

19.          Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas and Executive irrevocably agrees to subject himself to the exclusive personal jurisdiction and venue of any court in the Southern District of Texas.

20.       Non-Disparagement: During Executive’s employment with Company and, should

Executive’s employment terminate for any reason (whether voluntary or involuntary), for a period of

24 months following Executive’s separation, Executive agrees that Executive will not make any comment or take any action which disparages, defames, or places in a negative light Company or its past and present officers, directors, and Executives. Company agrees that during this same period, its officers and directors shall refrain from making any comment or taking any action to disparage, defame, or place Executive in a negative public light.

21.          Waiver.  No waiver by Company of any breach of this Agreement shall be a waiver of any preceding or succeeding breach. No waiver by Company of any right under this Agreement shall be construed as a waiver of any other right. Company shall not be required to give notice to enforce strict adherence to all terms of this Agreement

22.          Survival. The provisions of this Agreement shall survive the termination hereof employment and the assignment of this Agreement by Company to any successor in interest or other assignee.

23.          Headings. The headings to each section of this Agreement are provided for convenience of reference only and shall have no legal effect in the interpretation of the terms hereof.

24.          Notices. Any notices or other communications required or permitted hereunder shall be sufficiently given if sent by registered mail, postage prepaid, and

(a)          if to the Executive, addressed to him at: Edy Francis, 6511 Taimer Court, Sugar Land, Texas 77479;

(b)          if to Company, addressed to it at: Isramco, Inc., 1001 West Loop South, Suite 750, Houston, Texas 77027.  Attention:  Haim Tsuff, Chief Executive Officer and Chairman of the Board.

or such other address as the party to whom or to which such notice or other communication is to be given shall have specified in writing to the other party, and any such notice or communication shall be deemed to have been given as of the date so mailed.

25.          Arbitration. Company and Executive agrees to submit to final and binding arbitration any and all disputes, claims (whether in tort, contract, statutory, or otherwise) and/or disagreements

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concerning the interpretation or application of this Agreement and/or Executive’s employment by Company and/or the termination of this Agreement and/or Executive’s employment by Company; provided, however, notwithstanding the foregoing, in no event shall any dispute, claim or disagreement arising under Section 11 of this Agreement be submitted to arbitration pursuant to this Section 25 or otherwise. Any such dispute, claim and/or disagreement subject to arbitration pursuant to the terms of this Section 25 shall be resolved by arbitration in accordance with the Employment Dispute Resolution Rules then in effect with the American Arbitration Association (the “AAA”). Arbitration under this provision must be initiated within 30 days of the action, inaction, or occurrence about which the party initiating the arbitration is complaining. Within ten days of the initiation of an arbitration hereunder, each party with designate an arbitrator pursuant to Rule 14 of the AAA Rules. The appointed arbitrators will appoint a neutral arbitrator from the panel in the manner prescribed in Rule 13 of the AAA Rules. Executive and Company agree that the decision of the arbitrators selected hereunder will be final and binding on both parties. The parties hereto agree that any decision rendered by the arbitration panel may be entered as a judgment of the Harris County, Texas Courts or the United States District Court for the Southern District of Texas, Houston Division of Texas.

26.          Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same agreement.

IN WITNESS WHEREOF, Company has caused this Agreement to be executed by a duly authorized officer thereof, and the Executive has executed this Agreement effective as of the Effective Date.

 

	
COMPANY:

	
ISRAMCO, INC.

 

 

By:                                                                       

Haim Tsuff, Chairman of the Board & 

Chief Executive Officer

 

  

I understand that this agreement restricts my right to disclose or use Company’s Confidential Information during and subsequent to my employment. I have read this Employment Agreement carefully and understand its terms.

Dated:  November 3, 2017.

	
EXECUTIVE:

	
 

                                                                     

Edy Francis

 

 

Employment Agreement

Page 11EXHIBIT 4.5 

 

NEITHER
THE SECURITIES REPRESENTED HEREBY NOR THE SECURITIES ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES
NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED; AND NO SUCH WARRANT MAY BE EXERCISED UNLESS
(1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS,
OR (2) AN EXEMPTION FROM SUCH REGISTRATION EXISTS AND THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES,
WHICH COUNSEL AND OPINION ARE SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED
IN THE MANNER CONTEMPLATED OR EXERCISED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR APPLICABLE STATE
SECURITIES LAWS. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES
ACT.

 

Effective
Date: _________, 2017

 

ENTERA
BIO LTD.

 

WARRANT TO
PURCHASE SERIES B PREFERRED SHARES

 

Entera
Bio Ltd., a private Israeli company (the “Company”), for value received on the Effective Date, hereby issues
to __________________________ (the “Holder”) this Warrant (the “Warrant”) to purchase ______________
Warrant Shares (as defined below)(as from time to time adjusted as hereinafter provided) , at the Exercise Price (as defined below),
as adjusted from time to time as provided herein, on or before earlier of (i) expiration of five (5) years from the Effective
Date; or (ii) the closing of a Deemed Liquidation Event (as such term is defined in the Company's Articles of Association of the
Company, as may be amended and restated from time to time (the “Articles”) (the “Expiration Date”),
all subject to the following terms and conditions.

 

This
Warrant is one of a series of Warrants of like tenor being issued to the Placement Agent (as defined below) and related persons
in connection with the Company’s private offering (the “Offering”) of the Company’s Series B Preferred
Shares in accordance with, and subject to, the terms and conditions described in the Placement Agency Agreement as of August 25,
2017 (the “Placement Agency Agreement”) entered into by and between the Company and GP Nurmenkari Inc. (the
“Placement Agent”). Capitalized terms used herein without definition have the meanings ascribed to them in
the Placement Agency Agreement.

 

As
used in this Warrant, (i) "Warrant Shares" shall mean the Series B Preferred Shares of the Company, par value NIS 0.01
per share, or any securities issued or issuable, if any, according to Section 3 below, including, but not limited to, the automatic
conversion of Series B Preferred Shares into Ordinary Shares, par value NIS 0.01 per share (“Ordinary Shares”),
in accordance with the provisions of the Articles (for the avoidance of doubt, it is hereby clarified that upon automatic conversion
of the Preferred

 

     

    

    

 

Shares
of the Company into Ordinary Shares according to the terms of Section 6(b) of the Articles, the term "Warrants Shares"
shall mean Ordinary Shares of the Company); (ii) “Business Day” means any day other than Saturday, Sunday or
any other day on which commercial banks in the City of New York, New York, are authorized or required by law or executive order
to close; (iii) “Exercise Price” means $908.78 per share of Warrant Share, subject to adjustment as provided
herein; (iv) “Trading Day” means any day on which NASDAQ or the primary national stock exchange on which the
Company’s Ordinary Shares may, in the future, be listed, or if not so listed, the OTC Bulletin Board or the OTC Markets,
if quoted thereon, is open for the transaction of business; and (v) “Affiliate” means any person that, directly
or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, a person, as such
terms are used and construed in Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”).

 

		1.	DURATION
                                         AND EXERCISE OF WARRANTS

 

(a)            Exercise
Period. The Holder may exercise this Warrant in whole or in part on any Business Day on or before 5:00 P.M., New York, New
York Time, on the Expiration Date, at which time this Warrant shall become void and of no value.

 

		(b)	Exercise
                                         Procedures.

 

(i)       Cash.
While this Warrant remains outstanding and exercisable in accordance with Section 1(a), the Holder may exercise this Warrant in
whole or in part at any time and from time to time by:

 

(A)       delivery
to the Company of a duly completed and executed copy of the notice of exercise attached hereto as Exhibit A (the “Notice
of Exercise”), with the “CASH” payment option indicated;

 

(B)       surrender
of this Warrant to the chief financial officer of the Company at its principal offices or at such other office or agency as the
Company may specify in writing to the Holder; and

 

(C)       payment
of the then-applicable Exercise Price per share multiplied by the number of Warrant Shares being purchased upon exercise of the
Warrant (such amount, the “Aggregate Exercise Price”) made in the form of cash, or by wire transfer of immediately
available funds, certified check or bank draft payable in lawful money of the United States of America.

 

Provided
that the Holder may not exercise this Warrant unless it establishes to the Company’s satisfaction that it is either
an “accredited investor”, as defined in Regulation D promulgated under the Securities Act, or is not a “U.S.
person” and is exercising such Warrant in an “offshore transaction”, each as defined in Regulation S under the
Securities Act.

 

-

 

    2 

    

    

 

(ii)       Upon
the exercise of this Warrant in compliance with the provisions of this Section 1(b), and except as limited pursuant to Section
1(b)(iii), the Company shall promptly issue and cause to be delivered to the Holder a certificate for the Warrant Shares for which
this Warrant was exercised. Each exercise of this Warrant shall be effective immediately prior to the close of business on the
date (the “Date of Exercise”) that the conditions set forth in Section 1(b)(i) have been satisfied. On or before
the third (3rd) Business Day following the date on which the Company has received each of the items specified in Section
1(b)(i) (including the receipt of the payment of the Aggregate Exercise Price) (the “Exercise Deliverables”),
the Company shall, if public (“public” shall mean if the Company has become tradeable on NASDAQ, a US national
or regional stock exchange or on OTC Markets), transmit an acknowledgment of receipt of the Exercise Deliverables to the Company’s
transfer agent (the “Transfer Agent. On or before the fifth (5th) Business Day following the date on which
the Company has received all of the Exercise Deliverables (the “Share Delivery Date”), the Company shall, provided
that there is an effective registration statement under the Securities Act permitting resale of the Warrant Shares by the Holder
and that the Transfer Agent is participating in The Depository Trust Company (“DTC”) Fast Automated Securities
Transfer Program, upon the request of the Holder (subject to the Holder providing customary assurances that any resale will be
done under such registration statement), cause to be credited to the Holder’s balance account with DTC such number of Warrant
Shares to which the Holder is entitled upon the Holder’s exercise of this Warrant or issue or cause the Transfer Agent to
issue and dispatch by overnight courier to the address as specified in the Notice of Exercise, a certificate, registered in the
Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder
is entitled pursuant to such exercise.

 

Upon
delivery of the Exercise Deliverables, the Holder shall be deemed for all corporate purposes to have become the holder of record
of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates
evidencing such Warrant Shares.

 

(c)       Partial
Exercise. This Warrant shall be exercisable, either in its entirety or, from time to time, for part only of the number of
Warrant Shares referenced by this Warrant; provided, that any such partial exercise must be for an integral number of Warrant
Shares. If this Warrant is exercised in part, the Company shall issue, at its expense, a new Warrant, in substantially the form
of this Warrant, referencing such reduced number of Warrant Shares that remain subject to this Warrant.

 

(d)       Disputes.
In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the
Company shall promptly issue to the Holder the number of Warrant Shares that are not disputed and resolve such dispute in accordance
with Section 15.

 

		2.	ISSUANCE
                                         OF WARRANT SHARES

 

(a)       The
Company covenants that all Warrant Shares will, upon issuance in accordance with the terms of this Warrant, be (i) duly authorized,
fully paid and non-assessable, (ii) free from all liens, charges and security interests, with the exception of claims arising
through the acts or omissions of any Holder and except as arising from applicable securities laws, and (iii) will be subject to
terms of the Articles.

 

(b)       The
Company shall register this Warrant upon records to be maintained by the Company for that purpose in the name of the record holder
of such Warrant from time to time. The Company may

 

    3 

    

    

 

deem
and treat the registered Holder of this Warrant as the absolute owner thereof for the purpose of any exercise thereof, and for
all other purposes.

 

(c)       Subject
to the terms of this Warrant, the Company will not, by amendment of the Articles, avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Company, and will at all times in good faith assist in the carrying
out of all the provisions of this Warrant and in the taking of all action necessary or appropriate in order to allow the Holder
to exercise this Warrant in accordance with the terms of this Warrant.

 

		3.	ADJUSTMENTS
                                         OF EXERCISE PRICE, NUMBER AND TYPE OF WARRANT SHARES

 

(a)       General.
The Exercise Price and the number of shares purchasable upon the exercise of this Warrant shall be subject to adjustment from
time to time upon the occurrence of certain events described in this Section 3(a); provided, that notwithstanding the provisions
of this Section 3, the Company shall not be required to make any adjustment if and to the extent that such adjustment would require
the Company to issue a number of Warrant Shares, in excess of its authorized but unissued Warrant Shares , less all amounts of
Warrant Shares that have been reserved for issue upon the conversion of all outstanding securities convertible into Warrant Shares,
and the exercise of all outstanding options, warrants and other rights exercisable for Warrant Shares. If the Company does not
have the requisite number of authorized but unissued Warrant Shares to make any adjustment, the Company shall use its commercially
reasonable efforts to obtain the necessary shareholder consent to increase the authorized number of Warrant Shares to make such
an adjustment pursuant to this Section 3(a).

 

(i)       Subdivision
or Combination of Shares. In case the Company shall at any time subdivide (whether by way of share dividend, share split or
otherwise) its outstanding Warrant Shares into a greater number of shares, the Exercise Price in effect immediately prior to such
subdivision shall be proportionately reduced and the number of Warrant Shares purchasable upon the exercise of this Warrant shall
be proportionately increased, and conversely, in case the outstanding Warrant Shares shall be combined (whether by way of share
combination, reverse share split or otherwise) into a smaller number of shares, the Exercise Price in effect immediately prior
to such combination shall be proportionately increased and the number of Warrant Shares purchasable upon the exercise of this
Warrant shall be proportionately decreased. The Exercise Price and the number of Warrant Shares purchasable upon the exercise
of this Warrant, as so adjusted, shall be readjusted in the same manner upon the happening of any successive event or events described
in this Section 3(a)(i).

 

(ii)       Share
Dividend. If at any time, or from time to time, the holders of Warrant Shares shall have received or become entitled to receive,
without payment therefor, any shares or other securities that are at any time directly or indirectly convertible into or exchangeable
for Warrant Shares, or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend
or other distribution, then the Exercise Price and the number of Warrant Shares to be obtained upon exercise of this Warrant shall
be adjusted proportionately, and the Holder hereof shall, upon the exercise of this Warrant, be entitled to receive, in addition
to the number of Warrant Shares receivable thereupon, and without payment of any additional consideration therefor, the amount
of shares and other securities and property (including cash in the cases referred to above) that such Holder would hold on the
date of such exercise had such Holder been the holder of record of such Warrant Shares as of the date on which holders of Warrant
Shares received or became entitled to receive such shares or all other additional shares

 

    4 

    

    

 

and
other securities and property. The Exercise Price and the number of Warrant Shares purchasable upon the exercise of this Warrant,
as so adjusted, shall be readjusted in the same manner upon the happening of any successive event or events described in this
Section 3(a)(ii).

 

(iii)       Reorganization,
Reclassification, Consolidation, Merger or Sale. If any recapitalization, reclassification or reorganization of the share
capital of the Company, or any consolidation or merger of the Company with another corporation or any other entity, or the sale
of all or substantially all of its assets or other transaction, other than any transaction that is considered as a Deemed Liquidation
Event, shall be effected in such a way that holders of Warrant Shares shall be entitled to receive shares, securities or other
assets or property (an “Organic Change”), then, as a condition of such Organic Change, lawful and adequate
provisions shall be made by the Company whereby the Holder hereof shall thereafter have the right to purchase and receive (in
lieu of the Warrant Shares immediately theretofore purchasable and receivable upon the exercise of the rights represented by this
Warrant) such shares, securities or other assets or property as may be issued or payable with respect to or in exchange for a
number of outstanding Warrant Shares equal to the number of such shares immediately theretofore purchasable and receivable assuming
the full exercise of the rights represented by this Warrant. In the event of any Organic Change, appropriate provision shall be
made by the Company with respect to the rights and interests of the Holder of this Warrant to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise Price and of the number of shares purchasable and receivable
upon the exercise of this Warrant) shall thereafter be applicable, in relation to any shares, securities or assets thereafter
deliverable upon the exercise hereof. If there is an Organic Change, then the Company shall cause to be mailed to the Holder at
its last address as it shall appear on the books and records of the Company, at least ten (10) calendar days before the effective
date of the closing of the Organic Change, a notice stating the date on which such Organic Change is expected to become effective
or close, and the date as of which it is expected that holders of the Warrant Shares of record shall be entitled to exchange their
shares for securities, cash, or other property delivered upon such Organic Change; provided, that the failure to mail such
notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified
in such notice. The Holder is entitled to exercise this Warrant during the 10-day period commencing on the date of such notice
to the effective date of the event triggering such notice. In any event, the successor corporation (if other than the Company)
resulting from such consolidation or merger or the corporation purchasing such assets shall be deemed to assume such obligation
to deliver to such Holder such shares, securities or assets even in the absence of a written instrument assuming such obligation
to the extent such assumption occurs by operation of law.

 

(b)       Certificate
as to Adjustments. Upon the occurrence of each adjustment or readjustment pursuant to this Section 3, the Company at its expense
shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each Holder of this
Warrant a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment
or readjustment is based. The Company shall promptly furnish or cause to be furnished to such Holder a like certificate setting
forth: (i) such adjustments and readjustments; and (ii) the number of shares and the amount, if any, of other property which at
the time would be received upon the exercise of the Warrant.

 

(c)       Reserved.

 

    5 

    

    

 

		4.	TRANSFERS
                                         AND EXCHANGES OF WARRANT AND WARRANT SHARES

 

(a)       Registration
of Transfers and Exchanges. Subject to Section 4(c), upon the Holder’s surrender of this Warrant, with a duly executed
copy of the Form of Assignment attached as Exhibit B, to the chief financial officer of the Company at its principal offices
or at such other office or agency as the Company may specify in writing to the Holder, the Company shall register the transfer
of all or any portion of this Warrant. Upon such registration of transfer, the Company shall issue a new Warrant, in substantially
the form of this Warrant, evidencing the acquisition rights transferred to the transferee and a new Warrant, in similar form,
evidencing the remaining acquisition rights not transferred, to the Holder requesting the transfer.

 

(b)       Warrant
Exchangeable for Different Denominations. The Holder may exchange this Warrant for a new Warrant or Warrants, in substantially
the form of this Warrant, evidencing in the aggregate the right to purchase the number of Warrant Shares, which may then be purchased
hereunder, each of such new Warrants to be dated the date of such exchange and to represent the right to purchase such number
of Warrant Shares as shall be designated by the Holder. The Holder shall surrender this Warrant with duly executed instructions
regarding such re-certification of this Warrant to the Secretary of the Company at its principal offices or at such other office
or agency as the Company may specify in writing to the Holder.

 

(c)       Restrictions
on Transfers. This Warrant may not be transferred at any time without (i) registration under the Securities Act or (ii) an
exemption from such registration and, if requested by the Company, a written opinion of legal counsel of the Holder addressed
to the Company that the proposed transfer of the Warrant may be effected without registration under the Securities Act, which
opinion will be in form and from counsel reasonably satisfactory to the Company.

 

(d)       Permitted
Transfers and Assignments. Notwithstanding any provision to the contrary in this Section 4, the Holder may transfer, with
or without consideration, this Warrant or any of the Warrant Shares (or a portion thereof) to the Holder’s Affiliates (as
such term is defined under Rule 144 of the Securities Act) without obtaining the opinion from counsel that may be required by
Section 4(c)(ii), provided, that the Holder delivers to the Company and its counsel certification, documentation, and other
assurances reasonably required by the Company’s counsel.

 

		5.	MUTILATED
                                         OR MISSING WARRANT CERTIFICATE

 

If
this Warrant is mutilated, lost, stolen or destroyed, upon request by the Holder, the Company will, at its expense, issue, in
exchange for and upon cancellation of the mutilated Warrant, or in substitution for the lost, stolen or destroyed Warrant, a new
Warrant, in substantially the form of this Warrant, representing the right to acquire the equivalent number of Warrant Shares;
provided, that, as a prerequisite to the issuance of a substitute Warrant, the Company may require satisfactory evidence
of loss, theft or destruction as well as an indemnity from the Holder of a lost, stolen or destroyed Warrant.

 

		6.	PAYMENT
                                         OF TAXES

 

The
Holder will pay all taxes attributable to the, grant, issuance, exercise, sale, transfer and delivery of this Warrant and the
Warrant Shares. Subject to the foregoing, the Company will pay any

 

    6 

    

    

 

direct
fees and expenses, if any, related to the delivery of this Warrant, the issuance of the Warrant Shares and issuance of certificates
for the Warrant Shares.

 

		7.	FRACTIONAL SHARES

 

No
fractional Warrant Shares shall be issued upon exercise of this Warrant. Upon the full exercise of this Warrant, the Company,
in lieu of issuing any fractional Warrant Share, shall round up the number of Warrant Shares issuable to nearest whole share.

 

		8.	NO SHARE
                                         RIGHTS AND LEGEND

 

No
holder of this Warrant, as such, shall be entitled to vote or be deemed the holder of any other securities of the Company that
may at any time be issuable on the exercise hereof, nor shall anything contained herein be construed to confer upon the holder
of this Warrant, as such, the rights of a shareholder of the Company or the right to vote for the election of directors or upon
any matter submitted to shareholders at any meeting thereof, or give or withhold consent to any corporate action or to receive
notice of meetings or other actions affecting shareholders (except as provided herein), or to receive dividends or subscription
rights or otherwise (except as provide herein).

 

Each
certificate for Warrant Shares initially issued upon the exercise of this Warrant, and each certificate for Warrant Shares issued
to any subsequent transferee of any such certificate, shall be stamped or otherwise imprinted with a legend in substantially the
following form:

 

THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, OR OTHERWISE
TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE
STATE SECURITIES LAWS, OR (2) AN EXEMPTION FROM SUCH REGISTRATION EXISTS AND THE COMPANY RECEIVES AN OPINION OF COUNSEL TO THE
HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD,
PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OR APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE
WITH THE SECURITIES ACT.

 

		9.	REGISTRATION RIGHTS

 

The
Holder shall be entitled to the registration rights with respect to the Ordinary Shares into which the Series B Preferred Shares
may be converted as set forth in, and subject to the conditions of, the Company’s Amended and Restated Investors’
Rights Agreement.

 

    7 

    

    

 

		10.	NOTICES

 

All
notices, consents, waivers, and other communications under this Warrant must be in writing and will be deemed given to a party
(a) on the date of delivery, if delivered to the appropriate address by hand or by nationally recognized overnight courier service
(costs prepaid); (b) the date of transmission if sent by facsimile or e-mail with confirmation of transmission by the transmitting
equipment if such notice or communication is delivered prior to 5:00 P.M., New York, New York time, on a Business Day, or the
next Business Day after the date of transmission, if such notice or communication is delivered on a day that is not a Business
Day or later than 5:00 P.M., New York, New York time, on any Business Day; (c) the date received or rejected by the addressee,
if sent by certified mail, return receipt requested, if to the registered Holder hereof; or (d) seven days after the placement
of the notice into the mails (first class postage prepaid), to the Holder at the below address, facsimile number, or e-mail address,
if the registered Holder is not the original purchaser of this Warrant, then as provided in the Form of Assignment delivered to
the Company pursuant to Section 4(a) in connection with the assignment of this Warrant to such Holder, or if to the Company, to
it at:

 

Entera Bio,
Ltd.

Jerusalem Bio
Park

P. O. Box 12117

Jerusalem 91220

Attn: Chief
Executive Officer

Telephone:  +972-54-535-2683

Attn: Dr. Phillip Schwartz

E-mail Address: phillip@enterabio.com

 

(or to such
other address, facsimile number, or e-mail address as the Holder or the Company as a party may designate by notice to the other
party in accordance with this Section 10) with a copy to

 

Herzog
Fox & Neeman

4
Weizmann Street

Tel
Aviv 6423904 Israel

Attention:  Yair
Geva, Adv or Tomer Farkash

Telephone: +972-3-692-2020

Facsimile:  +972-3-6966464

E-mail
Address: gevay@hfn.co.il; farkasht@hfn.co.il

Holder:

 

		11.	SEVERABILITY

 

If
a court of competent jurisdiction holds any provision of this Warrant invalid or unenforceable, the other provisions of this Warrant
will remain in full force and effect. Any provision of this Warrant held invalid or unenforceable only in part or degree will
remain in full force and effect to the extent not held invalid or unenforceable.

 

    8 

    

    

 

		12.	BINDING
                                         EFFECT

 

This
Warrant shall be binding upon and inure to the sole and exclusive benefit of the Company, its successors and assigns, the registered
Holder or Holders from time to time of this Warrant and the Warrant Shares.

 

		13.	TERMINATION

 

This
Warrant shall terminate and be of no further force and effect on the earlier of 5:00 P.M., New York, New York Time, on the Expiration
Date or the date on which this Warrant has been exercised in full.

 

		14.	GOVERNING
                                         LAW

 

This
Warrant will be governed by and construed under the laws of Israel without regard to conflicts of laws principles that would require
the application of any other law. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder, 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. The Company 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 the Company at the address set forth in this Agreement and
agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. The prevailing party, as determined
by such court shall be entitled to collect any costs, disbursements and reasonable attorney’s fees from the other party.

 

		15.	DISPUTE
                                         RESOLUTION

 

In
the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant Shares, the Company
shall submit the disputed determinations or arithmetic calculations via facsimile within five (5) Business Days of receipt of
the Notice of Exercise giving rise to such dispute, as the case may be, to the Holder. If the Holder and the Company are unable
to agree upon such determination or calculation of the Exercise Price or the Warrant Shares within three Business Days of such
disputed determination or arithmetic calculation being submitted to the Holder, then the Company shall, at its sole discretion,
within five (5) Business Days, submit via facsimile (a) the disputed determination of the Exercise Price to an independent, reputable
investment bank selected by the Company, or (b) the disputed arithmetic calculation of the Warrant Shares to the Company’s
independent, outside accountant or third party appraiser (the "Appraiser") . The Company shall cause at
its expense the Appraiser, to perform the determinations or calculations and notify the Company and the Holder of the results
no later than ten (10) Business Days from the time it receives the disputed determinations or calculations; provided that, if
such disputed determination or arithmetic calculation being submitted by the Holder is determined to be incorrect, then the expense
of the Appraiser shall be the responsibility of the Holder. Such Appraiser's determination or calculation, as the
case may be, shall be final, binding and conclusive upon the parties thereto.

 

    9 

    

    

 

		16.	NOTICES
                                         OF RECORD DATE

 

Upon
(a) any establishment by the Company of a record date of the holders of any class of securities for the purpose of determining
the holders thereof who are entitled to receive any dividend or other distribution, or right or option to acquire securities of
the Company, or any other right, or (b) any capital reorganization, reclassification, recapitalization, merger or consolidation
of the Company with or into any other corporation or other entity, any transfer of all or substantially all the assets of the
Company, or any voluntary or involuntary dissolution, liquidation or winding up of the Company, or the sale, in a single transaction,
of a majority of the Company’s voting shares (whether newly issued, or from treasury, or previously issued and then outstanding,
or any combination thereof), the Company shall mail to the Holder at least seven (7) days, or such longer period as may be required
by law, prior to the record date specified therein, a notice specifying (i) the date established as the record date for the purpose
of such dividend, distribution, option or right and a description of such dividend, option or right, (ii) the date on which any
such reorganization, reclassification, transfer, consolidation, merger, dissolution, liquidation or winding up, or sale is expected
to become effective and (iii) the date, if any, fixed as to when the holders of record of Series B Preferred Shares shall be entitled
to exchange their Series B Preferred Shares for securities or other property deliverable upon such reorganization, reclassification,
transfer, consolation, merger, dissolution, liquidation or winding up.

 

		17.	RESERVATION
                                         OF SHARES

 

The
Company shall reserve and keep available out of its authorized but unissued Warrant Shares, for issuance upon the exercise of
this Warrant, free from pre-emptive rights, such number of Warrant Shares for which this Warrant shall from time to time be exercisable.
The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided
herein without violation of any applicable law or regulation. Without limiting the generality of the foregoing, the Company covenants
that it will use commercially reasonable efforts to take all such action as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and non-assessable Warrant Shares upon the exercise of this Warrant and use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents, including but not limited to consents from the Company’s
shareholders or Board of Directors or any public regulatory body, as may be necessary to enable the Company to perform its obligations
under this Warrant.

 

		18.	HEADINGS

 

The
headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this
Warrant.

 

		19.	AMENDMENT
                                         AND WAIVERS

 

Any
term of this Warrant may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), with the written consent of the Company and the Holders of a majority of
the Warrant Shares issuable upon exercise of the Warrants issued to holders according to the terms of the Placement Agency Agreement.

 

    10 

    

    

 

		20.	NO THIRD
                                         PARTY RIGHTS

 

This
Warrant is not intended, and will not be construed, to create any rights in any parties other than the Company and the Holder,
and no person or entity may assert any rights as third-party beneficiary hereunder.

 

		21.	ENTIRE
                                         AGREEMENT

 

This
Warrant constitutes the entire agreement between the parties pertaining to the subject matter contained in it and supersedes all
prior and contemporaneous agreements, representations, and undertakings of the parties, whether oral or written, with respect
to such subject matter.

 

[Signature
Page Follows]

 

    11 

    

    

 

IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed as of the date first set forth above.

 

	 	ENTERA
BIO LTD
	 	 
	 	 
	 	By: 	
	 	Name: 	Phillip
Schwartz
	 	Title: 	Chief
Executive Officer

 

 

     

    

    

 

EXHIBIT A

 

NOTICE
OF EXERCISE

 

(To be executed
by Holder of Warrant if Holder desires to exercise Warrant)

 

To Entera
Bio Ltd.:

 

The undersigned
hereby irrevocably elects to exercise this Warrant with respect to ___________________ Warrant Shares (as defined in the Warrant)
as follows:

 

CASH:
Number of Warrant Shares exercised X the Exercise Price (as defined in the Warrant) per share = $_________ (to be paid as provided
in Section 1(b)(i) of the Warrant) plus any applicable taxes payable by the undersigned pursuant to the Warrant.

 

The undersigned
requests that certificates for such shares be issued in the name of:

 

_________________________________________

 

_________________________________________

 

_________________________________________ 

(Please print
name, address and social security or federal employer identification number (if applicable))*

 

If
the shares issuable upon this exercise of the Warrant are not all of the Warrant Shares which the Holder is entitled to acquire
upon the exercise of the Warrant, the undersigned requests that a new Warrant evidencing the rights not so exercised be issued
in the name of and delivered to:

 

_________________________________________

 

_________________________________________

 

_________________________________________

(Please print
name, address and social security or federal employer identification number (if applicable))*

 

	 	Name
of Holder (print): 	 

	 	(Signature): 	 
	 	(By:)  	 
	 	(Title:) 	 
	 	Dated: 	 

 

 

*       If
Warrant Shares are to be issued in any name other than that of the registered Holder of the Warrant, then the Holder must include
an opinion of counsel, reasonably satisfactory to the Company, to the effect that such issuance complies with all applicable securities
laws.

 

     

    

    

 

EXHIBIT B

 

FORM OF ASSIGNMENT

 

FOR
VALUE RECEIVED, ___________________________________ hereby sells, assigns and transfers to each assignee set forth below all of
the rights of the undersigned under the Warrant (as defined in and evidenced by the attached Warrant) to acquire the number of
Warrant Shares set opposite the name of such assignee below and in and to the foregoing Warrant with respect to said acquisition
rights and the shares issuable upon exercise of the Warrant:

 

	Name
    of Assignee (and social security or federal employer identification number (if applicable))	Address	Number
    of Shares
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

If
the total of the Warrant Shares are not all of the Warrant Shares evidenced by the foregoing Warrant, the undersigned requests
that a new Warrant evidencing the right to acquire the Warrant Shares not so assigned be issued in the name of and delivered to
the undersigned.

 

	 	Name
of Holder (print): 	 

	 	(Signature): 	 
	 	(By:)  	 
	 	(Title:) 	 
	 	Dated:

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