Document:

EXHIBIT
4.2

     

    AudioCodes
Ltd.

     

    Amendment
to 2008 Equity Incentive Plan

    

    Effective
October 19, 2010, Section 3(a) of the AudioCodes Ltd. 2008 Equity Incentive Plan
(the "Plan") is
hereby amended to increase the aggregate maximum number of Ordinary Shares,
nominal value NIS 0.01 per share (the "Ordinary
Shares"), which may be issued under the Plan by 2,000,000 Ordinary
Shares, such that, subject to Section 16 of the Plan, the aggregate maximum
number of Ordinary Shares, which may be issued under the Plan following this
amendment shall be 4,009,122 Ordinary Shares.EXHIBIT
4.1

    

    ALLONGE NO 1 TO SECURED
CONVERTIBLE PROMISSORY NOTE

    

    This Allonge No. 1 (“Allonge”) to
Secured Convertible Promissory Note is dated as of this 3rd day of November,
2010.  Reference is hereby made to that certain Secured Convertible
Promissory Note dated April 23, 2010 (“Note”) delivered by Intellect
Neurosciences, Inc., a Delaware corporation (“Borrower”) to Alpha Capital
Anstalt, as Lender (“Holder”).

    

    NOW THEREFORE, in consideration of the
mutual promises and covenants contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereby agree as follows.

    

    Except as expressly amended by the
terms of this Allonge, the terms of the Note remain in full force and
effect.  All capitalized terms used and not defined herein are used as
defined in the Note.  As the context requires, all references herein
to “Note” refer to the Note as amended by this Allonge.

    

    The following term of the Note is
hereby amended by this Allonge:

    

    1.           Principal
Amount.  The principal amount of the Note shall be increased by
an additional $75,000 for an aggregate principal amount of
$275,000.  Interest on the increased portion of the principal amount
of the Note shall accrue at the same rate from and after the date
hereof.

    

    2.           Conversion
Price.  The Conversion Price as defined in Section 2.1(b) of
the Note is $0.0025, subject to further adjustment as provided in the
Transaction Documents.

    

    3.           Miscellaneous.  This
Allonge must be delivered by original signature for Borrower, but the Holder may
execute and deliver by facsimile copy.

    

    
      
        
          
            
              
                
                  	
                          INTELLECT
      NEUROSCIENCES, INC.

                        
	
                          (“Borrower”)

                        
	 
      
	
                          By:

                        	
                            /s/ Elliot Maza

                        	 
      
	 
      	
                           
      Title: President and
CFOExhibit
4.2

    

    ALLONGE NO 1 TO SECURED
CONVERTIBLE PROMISSORY NOTE

    

    This Allonge No. 1 (“Allonge”) to
Secured Convertible Promissory Note is dated as of this 3rd day of November,
2010.  Reference is hereby made to that certain Secured Convertible
Promissory Note dated April 23, 2010 (“Note”) delivered by Intellect
Neurosciences, Inc., a Delaware corporation (“Borrower”) to Marlin Capital
Marketing, LLC, as Lender (“Holder”).

    

    NOW THEREFORE, in consideration of the
mutual promises and covenants contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereby agree as follows.

    

    Except as expressly amended by the
terms of this Allonge, the terms of the Note remain in full force and
effect.  All capitalized terms used and not defined herein are used as
defined in the Note.  As the context requires, all references herein
to “Note” refer to the Note as amended by this Allonge.

    

    The following term of the Note is
hereby amended by this Allonge:

    

    1.           Principal
Amount.  The principal amount of the Note shall be increased by
an additional $75,000 for an aggregate principal amount of
$137,500.  Interest on the increased portion of the principal amount
of the Note shall accrue at the same rate from and after the date
hereof.

    

    2.           Conversion
Price.  The Conversion Price as defined in Section 2.1(b) of
the Note is $0.0025, subject to further adjustment as provided in the
Transaction Documents.

    

    3.           Miscellaneous.  This
Allonge must be delivered by original signature for Borrower, but the Holder may
execute and deliver by facsimile copy.

    

    
      
        	
                INTELLECT
      NEUROSCIENCES, INC.

              
	
                (“Borrower”)

              
	 
      
	
                By:

              	
                  /s/ Elliot Maza

              	 
      
	 
      	
                     Title:
      President and CFOUnassociated Document

    Exhibit 10.1

     

    ESCROW
AGREEMENT

     

    This Agreement is dated as of
the 3rd day of November, 2010 among Intellect Neurosciences,
Inc., a Delaware corporation (the “Company”), the subscribers listed on
Schedule I
hereto (“Subscribers”), and Grushko & Mittman, P.C. (the “Escrow
Agent”):

     

    WITNESSETH:

     

    WHEREAS, on or about April 23, 2010,
the Company and several of the Subscribers entered into a Subscription
Agreement calling for the sale by the Company to the Subscribers of
Notes, shares of the Company’s common stock, and Class A, B and C
Warrants (collectivley the “Warrants”) for an aggregate purchase price
of $2,320,000; and

     

    WHEREAS, the Company is in need of
additional funding and two of the Subscribers have agreed to loan the Company an
additional $150,000 (“Purchase Price”); and

     

    WHEREAS,
the Company has agreed to deliver Allonges against payment therefor, with
such Allonges and the Escrowed Funds to be delivered to the Escrow Agent, along
with the other documents, instruments and payments hereinafter described, to be
held in escrow and released by the Escrow Agent in accordance with the terms and
conditions of this Agreement; and

     

    WHEREAS, the parties hereto require the
purchase price to be released by the Escrow Agent in accordance with the terms
and conditions of this Agreement; and

     

    WHEREAS, the Escrow Agent is willing to
serve as escrow agent pursuant to the terms and conditions of this
Agreement;

     

    NOW THEREFORE, the parties agree as
follows:

     

    ARTICLE
I

     

    INTERPRETATION

     

    1.1.          Definitions.  Capitalized
terms used and not otherwise defined herein that are defined in the Subscription
Agreement shall have the meanings given to such terms in the Subscription
Agreement.  Whenever used in this Agreement, the following terms shall
have the following respective meanings:

     

    §           “Agreement”
means this Agreement and all amendments made hereto and thereto by written
agreement between the parties;

     

    §           “Allonges”
shall mean the Allonges amending the terms of the Notes;

     

    §           “Closing
Date” shall be the date that the Purchase Price is transmitted by wire transfer
or otherwise credited to or for the benefit of the Company;

     

    §           “Escrowed
Payment” means an aggregate cash payment of $150,000 which is the Purchase
Price;

     

    §           
“Majority in Interest” shall mean a majority in interest of the Secured Parties
as that term is defined in the Security Agreement dated April 23, 2010
consenting to this transaction and to the amendment of the Security Agreement
and Guaranty to include the Subscribers to this transaction as secured pari pasu
with each Secured Party to the April 23, 2010 transaction pursuant to the
“Consent of a Majority in Interest”;

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    §           “Notes”
Shall have the meaning set forth in the Subscription Agreement;

     

    §            “Subscriber
Legal Fees” shall mean the sum of $5,000;

     

    §           “Subscription
Agreement” means the Subscription Agreement dated April 23, 2010 (and the
exhibits and schedules thereto) entered into by the Company and Subscribers in
reference to the sale and purchase of the Notes, Common Stock, and
Warrants;

     

    §           Collectively,
Allonges, this executed Agreement and Subscriber Legal Fees are referred to
as “Company Documents”; and

     

    §           the
Subscribers executed Agreement and Consent of a Majority in Interest
are referred to as “Subscriber Documents”.

     

    1.2.         Entire
Agreement.  This Agreement along with the Escrowed Payment,
Company Documents and the Subscriber Documents constitute the entire agreement
between the parties hereto pertaining to the Escrowed Payment, Company Documents
and Subscriber Documents and supersedes all prior agreements, understandings,
negotiations and discussions, whether oral or written, of the
parties.  There are no warranties, representations and other
agreements made by the parties in connection with the subject matter hereof,
except as specifically set forth in this Agreement, the Escrowed Payment,
Company Documents and the Subscriber Documents.

     

    1.3.         Extended
Meanings.  In this Agreement words importing the singular
number include the plural and vice versa; words importing the masculine gender
include the feminine and neuter genders.  The word "person" includes
an individual, body corporate, partnership, trustee or trust or unincorporated
association, executor, administrator or legal representative.

     

    1.4.          Waivers and
Amendments.  This Agreement may be amended, modified,
superseded, cancelled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by all parties, or, in the
case of a waiver, by the party waiving compliance.  Except as
expressly stated herein, no delay on the part of any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of any party of any right, power or privilege hereunder
preclude any other or future exercise of any other right, power or privilege
hereunder.

     

    1.5.          Headings.  The
division of this Agreement into articles, sections, subsections and paragraphs
and the insertion of headings are for convenience of reference only and shall
not affect the construction or interpretation of this Agreement.

     

    1.6.          Law Governing this
Agreement.  This Agreement shall be governed by and construed
in accordance with the laws of the State of New York without regard to conflicts
of laws principles that would result in the application of the substantive laws
of another jurisdiction.  Any action brought by any party against the
other concerning the transactions contemplated by this Agreement shall be
brought only in the state courts of New York or in the federal courts located in
the state of New York.  All parties and the individuals executing this
Agreement and other agreements on behalf of the Company, the Escrow Agent and
Subscribers agree to submit to the jurisdiction of such courts and waive trial
by jury.  The prevailing party (which shall be the party which
receives an award most closely resembling the remedy or action sought) shall be
entitled to recover from the other party its reasonable attorney's fees and
costs.  In the event that any provision of this Agreement or any other
agreement delivered in connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law.  Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of any
agreement.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    1.7.           Specific Enforcement,
Consent to Jurisdiction.  The Company, the Escrow Agent and
Subscribers acknowledge and agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached.  It
is accordingly agreed that the parties shall be entitled to an injuction or
injunctions to prevent or cure breaches of the provisions of this Agreement and
to enforce specifically the terms and provisions hereof or thereof, this being
in addition to any other remedy to which any of them may be entitled by law or
equity.  Subject to Section 1.6 hereof,
each of the Company, the Escrow Agent and Subscribers hereby waives, and agrees
not to assert in any such suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such court, that the suit, action or
proceeding is brought in an inconvenient forum or that the venue of the suit,
action or proceeding is improper.  Nothing in this Section shall
affect or limit any right to serve process in any other manner permitted by
law.

     

    ARTICLE
II

     

    DELIVERIES
TO THE ESCROW AGENT

     

    2.1.           Company
Deliveries.  On or before the Closing Date, the Company shall
deliver the Company Documents to the Escrow Agent.

     

    2.2.           Subscriber
Deliveries.  On or before the Closing Date, Subscribers shall
deliver to the Escrow Agent the Purchase Price and the Subscriber
Documents.  The Escrowed Payment will be delivered pursuant to the
following wire transfer instructions:

    

    Citibank,
N.A.

    1155
6th
Avenue

    New York,
NY 10036

    ABA
Number: 0210-00089

    For
Credit to: Grushko & Mittman, IOLA Trust Account

    Account
Number: 45208884

    

    2.3.           Intention to Create
Escrow Over
Escrowed
Payment, Company Documents and
Subscriber Documents.  The Subscribers and Company intend that
the Escrowed Payment, Company Documents and Subscriber Documents shall be held
in escrow by the Escrow Agent pursuant to this Agreement for their benefit as
set forth herein.

     

    2.4.           Escrow Agent to Deliver
Escrowed
Payment, Company Documents and
Subscriber Documents.  The Escrow Agent shall hold and release
the Escrowed Payment, Company Documents and Subscriber Documents only in
accordance with the terms and conditions of this Agreement.

     

    ARTICLE
III

     

    RELEASE OF ESCROWED PAYMENT,

    COMPANY
DOCUMENTS AND SUBSCRIBER DOCUMENTS

     

    3.1.           Release of
Escrow.  Subject to the provisions of Section 4.2, the Escrow
Agent shall release the Escrowed Payment, Company Documents and Subscriber
Documents as follows:

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    (a)          On
the Closing Date, the Escrow Agent will simultaneously release the Company
Documents to the Subscribers, release the Subscriber Documents to the Company
and the Subscriber Legal Fees will be released directly to the Subscriber’s
attorneys.

     

    (b)          Notwithstanding
the above, upon receipt by the Escrow Agent of joint written instructions
(“Joint Instructions”) signed by the Company and the Subscribers, it shall
deliver the Escrowed Payment, Company Documents and Subscriber Documents in
accordance with the terms of the Joint Instructions.

     

    (c)          Anything
herein to the contrary notwithstanding, upon receipt by the Escrow Agent of a
final and non-appealable judgment, order, decree or award of a court of
competent jurisdiction (a "Court Order"), the Escrow Agent shall deliver the
Escrowed Payment, Company Documents and Subscriber Documents in accordance with
the Court Order.  Any Court Order shall be accompanied by an opinion
of counsel for the party presenting the Court Order to the Escrow Agent (which
opinion shall be satisfactory to the Escrow Agent) to the effect that the court
issuing the Court Order has competent jurisdiction and that the Court Order is
final and non-appealable.

     

    3.2.           Acknowledgement of
Company and
Subscriber; Disputes.  The Company and the Subscribers
acknowledge that the only terms and conditions upon which the Escrowed Payment,
Company Documents and Subscriber Documents are to be released are set forth in
Sections 3 and 4 of this Agreement.  The Company and the Subscribers
reaffirm their agreement to abide by the terms and conditions of this Agreement
with respect to the release of the Escrowed Payment, Company Documents and
Subscriber Documents.  Any dispute with respect to the release of the
Escrowed Payment, Company Documents and Subscriber Documents shall be resolved
pursuant to Section 4.2 or by agreement between the Company and
Subscribers.

     

    3.3.           Form
8-K.   The Company agrees to file a Form 8-K disclosing
the terms of this transaction within one day of the Closing Date.

     

    ARTICLE
IV

     

    CONCERNING
THE ESCROW AGENT

     

    4.1.          Duties and Responsibilities
of the Escrow Agent.  The Escrow Agent's duties and
responsibilities shall be subject to the following terms and
conditions:

     

    (a)           The
Subscribers and Company acknowledge and agree that the Escrow Agent (i) shall
not be responsible for or bound by, and shall not be required to inquire into
whether either the Subscribers or Company is entitled to receipt of the Escrowed
Payment, Company Documents and Subscriber Documents pursuant to any other
agreement or otherwise; (ii) shall be obligated only for the performance of such
duties as are specifically assumed by the Escrow Agent pursuant to this
Agreement; (iii) may rely on and shall be protected in acting or refraining from
acting upon any written notice, instruction, instrument, statement, request or
document furnished to it hereunder and believed by the Escrow Agent in good
faith to be genuine and to have been signed or presented by the proper
person or party, without being required to determine the authenticity or
correctness of any fact stated therein or the propriety or validity or the
service thereof; (iv) may assume that any person believed by the Escrow Agent in
good faith to be authorized to give notice or make any statement or execute any
document in connection with the provisions hereof is so authorized; (v) shall
not be under any duty to give the property held by Escrow Agent hereunder any
greater degree of care than Escrow Agent gives its own similar property; and
(vi) may consult counsel satisfactory to Escrow Agent, the opinion of such
counsel to be full and complete authorization and protection in respect of any
action taken, suffered or omitted by Escrow Agent hereunder in good faith and in
accordance with the opinion of such counsel.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

     

    (b)           The
Subscribers and Company acknowledge that the Escrow Agent is acting solely as a
stakeholder at their request and that the Escrow Agent shall not be liable for
any action taken by Escrow Agent in good faith and believed by Escrow Agent to
be authorized or within the rights or powers conferred upon Escrow Agent by this
Agreement.  The Subscribers and Company, jointly and severally, agree
to indemnify and hold harmless the Escrow Agent and any of Escrow Agent's
partners, employees, agents and representatives for any action taken or omitted
to be taken by Escrow Agent or any of them hereunder, including the fees of
outside counsel and other costs and expenses of defending itself against any
claim or liability under this Agreement, except in the case of gross negligence
or willful misconduct on Escrow Agent's part committed in its capacity as Escrow
Agent under this Agreement.  The Escrow Agent shall owe a duty only to
the Subscribers and Company under this Agreement and to no other
person.

     

    (c)           The
Subscribers and Company jointly and severally agree to reimburse the Escrow
Agent for outside counsel fees, to the extent authorized hereunder and incurred
in connection with the performance of its duties and responsibilities
hereunder.

     

    (d)           The
Escrow Agent may at any time resign as Escrow Agent hereunder by giving five (5)
days prior written notice of resignation to the Subscribers and the
Company.  Prior to the effective date of the resignation as specified
in such notice, the Subscribers and Company will issue to the Escrow Agent a
Joint Instruction authorizing delivery of the Escrowed Payment, Company
Documents and Subscriber Documents to a substitute Escrow Agent selected by the
Subscribers and Company.  If no successor Escrow Agent is named by the
Subscribers and Company, the Escrow Agent may apply to a court of competent
jurisdiction in the State of New York for appointment of a successor Escrow
Agent, and to deposit the Escrowed Payment, Company Documents and
Subscriber Documents with the clerk of any such court.

     

    (e)           Other
than in connection with the Subscriber Legal Fees, the Escrow Agent does not
have and will not have any interest in the Escrowed Payment, Company Documents
and Subscriber Documents, but is serving only as escrow agent, having only
possession thereof.  The Escrow Agent shall not be liable for any loss
resulting from the making or retention of any investment in accordance with this
Escrow Agreement.

     

    (f)           This
Agreement sets forth exclusively the duties of the Escrow Agent with respect to
any and all matters pertinent thereto and no implied duties or obligations shall
be read into this Agreement.

     

    (g)            Escrow
Agent may generally engage in any kind of business with either Company or
Subscribers or any subsidiary or affiliate thereof as if it had not entered into
this Agreement or any other agreement with them. Escrow Agent and its affiliates
and their officers, directors, employees, and agents (including legal counsel)
may now or hereafter be engaged in one or more transactions with either the
Company or Subscribers or may act as trustee, agent or representative of either
the Company or Subscribers, or otherwise be engaged in other transactions with
such parties (collectively, the “Other Activities”).  Without limiting
the forgoing, Escrow Agent and its affiliates and their officers, directors,
employees, and agents (including legal counsel) shall not be responsible to
account to the Company or Subscribers for such Other Activities.

     

    (h)           The
provisions of this Section 4.1 shall
survive the resignation of the Escrow Agent or the termination of this
Agreement.

     

    4.2.         Dispute Resolution:
Judgments.  Resolution of disputes arising under this Agreement
shall be subject to the following terms and conditions:

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

    (a)           If
any dispute shall arise with respect to the delivery, ownership, right of
possession or disposition of the Escrowed Payment, Company Documents and
Subscriber Documents, or if the Escrow Agent shall in good faith be uncertain as
to its duties or rights hereunder, the Escrow Agent shall be authorized, without
liability to anyone, to (i) refrain from taking any action other than to
continue to hold the Escrowed Payment, Company Documents and Subscriber
Documents pending receipt of a Joint Instruction from the Subscribers and
Company, or (ii) deposit the Escrowed Payment, Company Documents and Subscriber
Documents with any court of competent jurisdiction in the State of New York, in
which event the Escrow Agent shall give written notice thereof to the
Subscribers and the Company and shall thereupon be relieved and discharged from
all further obligations pursuant to this Agreement.  The Escrow Agent
may, but shall be under no duty to, institute or defend any legal proceedings
which relate to the Escrowed Payment, Company Documents and Subscriber
Documents.  The Escrow Agent shall have the right to retain counsel if
it becomes involved in any disagreement, dispute or litigation on account of
this Agreement or otherwise determines that it is necessary to consult
counsel.

     

    (b)           The
Escrow Agent is hereby expressly authorized to comply with and obey any Court
Order.  In case the Escrow Agent obeys or complies with a Court Order,
the Escrow Agent shall not be liable to the Subscribers and Company or to any
other person, firm, corporation or entity by reason of such
compliance.

     

    ARTICLE
V

     

    GENERAL
MATTERS

     

    5.1.           Termination.  This
escrow shall terminate upon the release of all of the Escrowed Payment, Company
Documents and Subscriber Documents or at any time upon the agreement in writing
of the Subscribers and Company.

     

    5.2.           Notices.   All
notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise
specified herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice.  Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur.  The
addresses for such communications shall be:

     

    (a)           If
to the Company, to:

    

    Intellect Neurosciences,
Inc.

    45West 36th Street,
3rd
Floor

    New York, NY 10018

    Attn: Elliot Maza, CFO

    Fax: (212) 448-9600

    

    With a copy by fax only
to:

    

    Sichenzia
Ross Friedman Ference LLP

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    61
Broadway

    New York,
NY 10006

    Attn:
Harvey Kersner, Esq.

    Facsimile:
(212) 930-9725

    

    
      	
              (b)

            	
              If
      to the Subscribers: to the addresses set forth on Schedule
    I

            

    

    

    With a copy by facsimile only
to:

     

    Grushko
& Mittman, P.C.

    515 Rockaway Avenue

    Valley
Stream, New York 11581

    Fax:
212-697-3575

     

    
      	
              (c)

            	
              If
      to the Escrow Agent, to:

            

    

     

    Grushko
& Mittman, P.C.

    515 Rockaway Avenue

    Valley
Stream, New York 11581

    Fax:
212-697-3575

     

    or to
such other address as any of them shall give to the others by notice made
pursuant to this Section
5.2.  In the sole and absolute discretion of the Escrow Agent,
the Escrow Agent may accept and rely on any other non-oral method of giving of
notice including by email.

     

    5.3.           Interest.  The
Escrowed Payment shall not be held in an interest bearing account nor will
interest be payable in connection therewith.  In the event the
Escrowed Payment is deposited in an interest bearing account, the Subscribers
shall be entitled to receive any accrued interest thereon, but only if the
Escrow Agent receives from the Subscriber the Subscribers’ United States
taxpayer identification number and other requested information and
forms.

     

    5.4.           Assignment; Binding
Agreement.  Neither
this Agreement nor any right or obligation hereunder shall be assignable by any
party without the prior written consent of the other parties
hereto.  This Agreement shall enure to the benefit of and be binding
upon the parties hereto and their respective legal representatives, successors
and assigns.

     

    5.5.           Invalidity.  In
the event that any one or more of the provisions contained herein, or the
application thereof in any circumstance, is held invalid, illegal, or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the parties hereto shall be
enforceable to the fullest extent permitted by law.

     

    5.6.           Counterparts/Execution.  This
Agreement may be executed in any number of counterparts and by different
signatories hereto on separate counterparts, each of which, when so executed,
shall be deemed an original, but all such counterparts shall constitute but one
and the same instrument.  This Agreement may be executed by facsimile
transmission and delivered by facsimile transmission.

     

    5.7.           Agreement.  Each
of the undersigned states that he has read the foregoing Escrow Agreement and
understands and agrees to it.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    5.8           Compensation of Escrow
Agent. The Escrow Agent shall be entitled to payment in the amount of
$5,000 for the services rendered hereunder. It is understood by all parties that
the fee may be deducted from the Escrowed Funds when it becomes due. The Company
and the Subscribers shall jointly and severally, reimburse the Escrow Agent on
demand for all loss, liability, damage, disbursements, advances, costs, fees or
expenses paid or incurred by it in the administration of its duties hereunder,
including, but not limited to, all wire fees, packaging and postal fees and
expenses (including federal express), all reasonable counsel fees and
disbursements and all taxes or other governmental charges.  At all
times, the Escrow Agent will have a right of set off and first lien on the funds
in the Escrowed Funds for payment of such fees and expenses and all such loss,
liability, damage or expenses.

     

    [REST OF
THIS PAGE LEFT INTENTIONALLY BLANK]

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
undersigned have executed and delivered this Escrow Agreement, as of the date
first written above.

    

    “COMPANY”

    INTELLECT
NEUROSCIENCES, INC.

    a
Delaware corporation

    

    
      
        
          
            
              	 
      	
                      By:

                    	
                      /s/
      Elliot Maza

                    	 
      
	 
      	
                       
      Name: Elliot Maza

                    
	 
      	
                       
      Title: President and
CFO

                    

            

          

        

      

    

    

    “SUBSCRIBERS”

    

    
      
        
          	
                  ALPHA
      CAPITAL ANSTALT

                	
                  MARLIN
      CAPITAL MARKETING, LLC

                
	 
      	 
      
	 
      	 
      	 
      	 
      
	
                  By:

                	
                  By:

                
	
                  Its:

                	
                  Its:

                

        

      

    

     

    
      
        
          
            
              	 	ESCROW
      AGENT: 
	 	 
	 
      	
                      GRUSHKO
      & MITTMAN, P.C.

                    
	 
      	 
      
	 
      	
                      By:

                    	 
      	 
      
	 
      	 
      	
                      Name:

                    

            

          

        

      

    

     

    Intellect Neurosciences, Inc., by
Elliot Maza, its President and CFO acknowledges, agrees and consents to all of
the terms of the foregoing Agreement and agrees to undertake to cooperate with
Subscribers in fulfilling the purposes and intent of this Agreement and not take
any action or suffer inaction inconsistant with Subscribers’ lawful rights under
this Agreement, including the amendment of any of the agreements, if necessary,
including but not limited to the Security Agreement and Guaranty in order to
include the aggregate $150,000 Purchase Price as part of the secured
debt.

    

    
      
        
          
            	 
      	
                    INTELLECT
      NEUROSCIENCES, INC.

                  
	 
      	 
      
	 
      	
                    By:

                  	
                    /s/
      Elliot Maza

                  	 
      
	 
      	
                     Name:
      Elliot Maza

                  
	 
      	
                     Title:
      President and CFO

                  

          

        

      

    

     

    
      
         

      

      
        9

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