Document:

EX-10.22

 Exhibit 10.22 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential
Treatment has been requested with respect to the omitted portions. 
 EXECUTION VERSION 

EXCLUSIVE LICENSE AND OPTION AGREEMENT 

This EXCLUSIVE LICENSE AND OPTION AGREEMENT (the “Agreement”) is made and entered into effective as of 28 October 2017 (the
“Effective Date”) by and between ASTRAZENECA AB, a company incorporated in Sweden under no. 556011-7482 with its registered office at SE-151 85 Sodertalje, Sweden
(“AstraZeneca”), and MEREO BIOPHARMA 4 LIMITED, a company incorporated in England and Wales under no. 11029583 with its registered office at 4th Floor, One, Cavendish Place,
London, W1G 0QF (“Mereo”). AstraZeneca and Mereo are sometimes referred to herein individually as a “Party” and collectively as the “Parties.” 

BACKGROUND 
  

	(A)	AstraZeneca owns and controls certain intellectual property rights and assets relating to a compound designated AZD9668, which is an orally delivered form of a neutrophil elastase inhibitor that has been the subject of
Phase II clinical trials in respiratory diseases [***]; 

  

	(B)	AstraZeneca wishes to grant a world-wide, exclusive license to Mereo and Mereo wishes to obtain, a license under such intellectual property rights to develop, manufacture and commercialize such compounds in the
Territory, in each case in accordance with the terms and conditions set forth in this Agreement; and 

  

	(C)	AstraZeneca wishes to grant Mereo an option to acquire title to certain of such intellectual property rights and Mereo wishes to obtain such option, in accordance with the terms and conditions set forth in this
Agreement. 

 NOW, THEREFORE, in consideration of the premises and the mutual promises and conditions set forth herein and other good
and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound, do hereby agree as follows: 
  

	1.	DEFINITIONS 

 Unless otherwise specifically provided herein, the following terms shall
have the following meanings: 
  

	1.1	“[***]” has the meaning given in the Subscription Deed; 

  

	1.2	“Accounting Standards” means the International Financial Reporting Standards (“IFRS”), consistently applied. 

 

	1.3	“Additional Studies” means the [***] collaborative research agreements currently under negotiation or recently executed between AstraZeneca or its Affiliates and [***], in each case
which relate to the Compounds and which will be entered into prior to or after the Effective Date pursuant to Section 5.6, as further described in Part 1 of Schedule 1.3. 

	1.4	“Affiliate” means, with respect to a Party, any Person that, directly or indirectly, through one (1) or more intermediaries, controls, is controlled by or is under common control with such Party.
For purposes of this definition, “control” and, with correlative meanings, the terms “controlled by” and “under common control with” means: (i) the possession, directly or indirectly, of the power to direct the
management or policies of a business entity, whether through the ownership of voting securities, by contract relating to voting rights or corporate governance or otherwise; or (ii) the ownership, directly or indirectly, of fifty percent (50%)
or more of the voting securities or other ownership interest of a business entity (or, with respect to a limited partnership or other similar entity, its general partner or controlling entity). 

 

	1.5	“Agreement” has the meaning set forth in the preamble hereto. 

  

	1.6	“Anti-Corruption Laws” means the U.S. Foreign Corrupt Practices Act, as amended, the UK Bribery Act 2010, as amended, and any other applicable anti-corruption laws and laws for the prevention of fraud,
racketeering, money laundering or terrorism. 

  

	1.7	“Applicable Law” means all federal, provincial, state, local and foreign law (including United States), (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule,
regulation, directive, order, injunction, judgment, decree, ruling or other similar requirement, and other agreements between states or between states and the European Union or other supranational bodies, including any rules, regulations, guidelines
or other requirements of the Regulatory Authorities, that may be in effect from time to time, including the FFDCA and the Anti-Corruption Laws. 

  

	1.8	“API” means active pharmaceutical ingredient. 

  

	1.9	“AstraZeneca” has the meaning set forth in the preamble hereto. 

  

	1.10	“AstraZeneca Hourly Rate” means an hourly rate of [***] United States Dollars for AstraZeneca personnel. 

  

	1.11	“AZ’s Global Ethical Interactions Policy” means AstraZeneca’s “Ethical Interactions & Anti-Bribery/Anti-Corruption Policy”, as available on AstraZeneca’s
website at https://www.astrazeneca.com/content/dam/az/PDF/Ethical-Interactions-Policy.pdf from time to time. 

  

	1.12	“Auditor” has the meaning set forth in Section 8.14. 

  

	1.13	“Breaching Party” has the meaning set forth in Section 14.2.1. 

  

	1.14	“Business” means the assets, business, operations and activities of Developing and Manufacturing the Compounds and includes any other actions taken in furtherance of the Business. 

 

	1.15	“Business Day” means a day other than a Saturday or Sunday or a day on which banking institutions in London or Stockholm, Sweden are permitted or required to be closed. 

  
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	1.16	“Calculation Agent” means the auditors (from time to time) of the Company or, if they are unwilling or unable to act, an independent firm of chartered accountants (of international repute) as the
parties shall agree (or, if they are unable to reach agreement within [***] of a notice to agree being served by either party on the other, as determined by the [***] on the [***]); 

 

	1.17	“Calendar Quarter” means each successive period of three (3) calendar months commencing on 1 January, 1 April, 1 July and 1 October, except that the first Calendar Quarter of the
Term shall commence on the Effective Date and end on the day immediately prior to the first to occur of 1 January, 1 April, 1 July or 1 October after the Effective Date and the last Calendar Quarter shall end on the last day of
the Term. 

  

	1.18	“Calendar Year” means each successive period of twelve (12) calendar months commencing on 1 January and ending on 31 December, except that the first Calendar Year of the Term shall commence on
the Effective Date and end on 31 December of the year in which the Effective Date occurs and the last Calendar Year of the Term shall commence on 1 January of the year in which the Term ends and end on the last day of the Term.

  

	1.19	“Clinical Trial” means any [***], [***] and/or variations or subsets of such trials.  

  

	1.20	“Combination Product” means (a) a single Product in finished form that is comprised of or contains a Compound as an API together with one (1) or more other APIs and is sold [***]; (b) any
Product [***]; or (c) any Product [***] (i.e. where a Product [***]), to the extent not described in (a) or (b). 

  

	1.21	“Commencement” means, in relation to a Clinical Trial, the first dosing of the first patient participating in such Clinical Trial. 

 

	1.22	“Commercialization” means any and all activities directed to the launch of, offering for sale of or sale of a Product, including activities related to marketing, promoting, detailing, distributing,
Manufacturing, importing, exporting, offering to sell or selling such Product, interacting with Regulatory Authorities regarding any of the foregoing and seeking pricing or reimbursement approvals (as applicable). When used as a verb, “to
Commercialize” and “Commercializing” means to engage in Commercialization and “Commercialized” has a corresponding meaning. 

  

	1.23	“Commercially Reasonable Efforts” means, with respect to the performance of Development or Commercialization activities with respect to a Compound or a Product by Mereo, the carrying out of such
activities using efforts and resources comparable to the efforts and resources used by an entity that is comparable and similarly situated to Mereo in the research-based bio-pharmaceutical industry for
compounds or products of similar market potential at a similar stage in development or product life taking into account mechanism of action, product profile, efficacy, safety, actual or anticipated Regulatory Authority approved labelling, the nature
and extent of market exclusivity (including patent coverage, proprietary position and regulatory exclusivity), competitiveness of alternative products in the marketplace, costs, time required for and likelihood of obtaining Regulatory Approval given
the regulatory structure involved, product profitability, and other relevant factors commonly considered in similar circumstances. 

  
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in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
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	1.24	“Competitive Product” means any neutrophil elastase inhibitors for the treatment of: Alpha-1 Antitrypsin Deficiency. 

 

	1.25	“Compound” means (a) (i) the pharmaceutical compound known as AZD9668, which is a neutrophil elastase inhibitor (the “9668 Compound”) [***] and (b) any [***] of (a).

  

	1.26	“Confidential Information” has the meaning set forth in Section 10.1. 

  

	1.27	“Control” or “Controlled” (as applicable) means, with respect to any item of Information, Regulatory Documentation, material, Patent, Know-How or
other intellectual property right, possession of the right of a Party or its Affiliates, whether directly or indirectly and whether by ownership, license or otherwise (other than by operation of the license and other grants in Section 2.1), to
grant to the other Party a license, sublicense, access or other right (including the right to reference Regulatory Documentation) to or under such Information, Regulatory Documentation, Patent or other intellectual property right as provided for
herein without violating the terms of any agreement with any Third Party in existence as of the time such Party or its Affiliates would first be required hereunder to grant the other Party such license, sublicense, access or other right.

  

	1.28	“Controlling Party” has the meaning set forth in Section 9.5. 

  

	1.29	“Currency Conversion Policy” means Mereo’s, its Affiliate’s or Sublicensee’s, as applicable, standard currency conversion policy from time to time, consistent with Accounting Standards
and IAS 21 (The Effects of Changes in Foreign Exchange Rates) and which is consistently applied across Mereo, its Affiliates or Sublicencee, as applicable.  

 

	1.30	“Development” means all drug development activities, including those related to research, pre-clinical and other
non-clinical testing, test method development and stability testing, toxicology, assay development and audit development formulation, process development, manufacturing
scale-up, qualification and validation, quality assurance/quality control, clinical studies, including Manufacturing in support thereof, statistical analysis and report writing, the preparation, submission and
prosecution of Drug Approval Applications, regulatory affairs with respect to the foregoing, packaging development and all other activities necessary or reasonably useful or otherwise requested or required by a Regulatory Authority as a condition or
in support of obtaining or maintaining a Regulatory Approval. When used as a verb, “Develop” means to engage in Development. 

  

	1.31	“Development Report Period” means, on a Product-by-Product basis, the period commencing on the Effective Date and
expiring on Mereo’s cessation of Development for such Product. 

  

	1.32	“Dispute” has the meaning set forth in Section 16.6.1. 

  
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	1.33	“Dollars” or “$” means United States Dollars. 

  

	1.34	“Drug Approval Application” means a New Drug Application as defined in the FFDCA or any corresponding foreign application in the Territory, including, with respect to the European Union, a Marketing
Authorization Application filed with the EMA pursuant to the centralized approval procedure or with the applicable Regulatory Authority of a country in Europe with respect to the mutual recognition or any other national approval. 

 

	1.35	“Effective Date” has the meaning set forth in the preamble hereto. 

  

	1.36	“EMA” means the European Medicines Agency and any successor agency thereto. 

  

	1.37	“Enforcing Party” has the meaning set forth in Section 9.3.2. 

  

	1.38	“European Union” or “EU” means the economic, scientific and political organization of member states as it may be constituted as at the Effective Date. For clarity, the European Union,
as at the Effective Date, includes the United Kingdom. 

  

	1.39	“Exploit” means to make, have made, import, use, sell or offer for sale, including to research, Develop, Commercialize, register, Manufacture, have Manufactured, hold or keep (whether for disposal or
otherwise), have used, export, transport, distribute, promote, market or have sold or otherwise dispose of. 

  

	1.40	“Exploitation” means the act of Exploiting a compound, product or process. 

  

	1.41	“Fair Market Value” means, with respect to any property on any date, the fair market value of that property as determined by the Calculation Agent, provided that the fair market value of a cash dividend
paid or to be paid per Ordinary Share shall be the amount of such cash dividend per Ordinary Share determined as at the date of announcement of such dividend; 

  

	1.42	“FDA” means the United States Food and Drug Administration and any successor agency thereto. 

  

	1.43	“FFDCA” means the United States Food, Drug, and Cosmetic Act, as amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions,
supplements, extensions and modifications thereto). 

  

	1.44	“Field” means all diagnostic, prophylactic and therapeutic uses in humans and animals. 

  

	1.45	“First Commercial Sale” means, on a Product-by-Product and
country-by-country basis, the first invoiced sale by Mereo or an Affiliate of Mereo or a Sublicensee to a Third Party for monetary value for use or consumption by the
end user of such Product in such country after Regulatory Approval for such Product has been obtained in such country. Sales or transfers prior to receipt of Regulatory Approval for such Product for research, use pursuant to a treatment IND, proof
of concept studies or other clinical trial purposes, or for compassionate, named patient or other similar use, shall not be considered a First Commercial Sale. 

  
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	1.46	“[***]” means the [***] of [***] following [***] of [***] of [***] such that the [***]. For the avoidance of doubt this does not include [***]. 

 

	1.47	“Generic Version” means, with respect to [***] a Product, any other prescription pharmaceutical product sold by a Third Party that is not a Sublicensee, or distributor of Mereo, its Affiliate, or their
Sublicensees, that (i) contains the same API(s) as such Product, (ii) has the same [***] as such Product and (ii) is “therapeutically equivalent” as evaluated by the FDA, applying the definition of “therapeutically
equivalent” set forth in the preface to the FDA’s Orange Book (or, with respect to any country in the Territory outside the United States, is similarly substitutable under equivalent Applicable Law in such country), with respect to such
[***], as such Product. 

  

	1.48	“Government Official” means (a) any Person employed by or acting on behalf of a government, government-controlled agency or entity or public international organization,
(b) any political party, party official or candidate, (c) any Person who holds or performs the duties of an appointment, office or position created by custom or convention or (d) any Person who holds himself out to be the authorized
intermediary of any of the foregoing. 

  

	1.49	“Hatch-Waxman Act” means the U.S. “Drug Price Competition and Patent Term Restoration Act” of 1984, as set forth at 21 U.S.C. §355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV). 

 

	1.50	“Indemnification Claim Notice” has the meaning set forth in Section 13.3.1. 

  

	1.51	“Indemnified Party” has the meaning set forth in Section 13.3.1. 

  

	1.52	“Indication” means a specific disease or condition for which a Product is designed to diagnose, mitigate, prevent or treat. 

 

	1.53	“Information” means all technical, scientific and other know-how and information, trade secrets, knowledge, technology, means, methods, processes, practices,
formulae, instructions, skills, techniques, procedures, structures, sequences, experiences, ideas, technical assistance, designs, drawings, assembly procedures, computer programs, apparatuses, specifications, data, results and other material,
including: biological, chemical, pharmacological, toxicological, pharmaceutical, physical and analytical, pre-clinical, clinical, safety, manufacturing and quality control data and information, including study
designs and protocols, statistical programs including QC programs, clinical study reports, trial master files, assays and biological methodology, in each case (whether or not confidential, proprietary, patented or patentable) in written, electronic
or any other form now known or hereafter developed under or in connection with any Transferring Contract, Additional Study or Ongoing Research Agreement which is not assigned to Mereo as of the Effective Date. 

 

	1.54	“Infringement” has the meaning set forth in Section 9.3.1. 

  

	1.55	“Initiation” means, with respect to a clinical study, the first dosing of the first human subject in such clinical study. 

  
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	1.56	“Invention” means any invention, Information, discovery, development or modification, whether or not patented or patentable. 

 

	1.57	“Invoiced Sales” has the meaning set forth in the definition of “Net Sales”. 

  

	1.58	“Knowledge” means, with regard to AstraZeneca, the actual knowledge [***] of [***] of AstraZeneca [***], and with respect to Mereo, the actual knowledge of the [***] of Mereo. 

  

	1.59	“Loan Note 1” means the [***] to be issued by Mereo to MBGP for the principal amount of $2.0 million pursuant to Section 8.2.1(a). 

 

	1.60	“Loan Note 2” means the [***] to be issued by Mereo to MBGP for the principal amount of $[***] pursuant to Section 8.2.1(b). 

 

	1.61	“Loan Note 3” means the [***] to be issued by Mereo to MBGP for the principal amount of $[***] pursuant to Section 8.2.1(c). 

 

	1.62	“Loan Notes” means Loan Note 1, Loan Note 2 and Loan Note 3; 

  

	1.63	“Losses” has the meaning set forth in Section 13.1. 

  

	1.64	“MAA” means an application for the authorization to market any Product in any country or group of countries outside the United States, as defined in the applicable laws and regulations and filed with
the Regulatory Authority of a given country or group of countries. 

  

	1.65	“Manufacture” and “Manufacturing” means all activities related to the production, manufacture, processing, filling, finishing, packaging, labelling, shipping and holding of a Product,
or Compound or any intermediate thereof, including process development, process qualification and validation, scale-up, pre-clinical, clinical and commercial manufacture
and analytical development, product characterization, stability testing, quality assurance and quality control. 

  

	1.66	“Material Anti-Corruption Law Violation” means a violation of an Anti-Corruption Law relating to the subject matter of this Agreement that would, [***], have a material adverse
effect on AstraZeneca [***]. 

  

	1.67	“Mereo” has the meaning set forth in the preamble hereto. 

  

	1.68	“MBGP” means Mereo BioPharma Group plc, a company incorporated in England and Wales with registered number 09481161. 

 

	1.69	“NCATS” means the National Center for Advancing Translational Sciences of the United States National Institutes of Health. 

 

	1.70	“Net Sales” means, with respect to a Product for any period, the gross amounts invoiced by Mereo or its Affiliates to Third Parties for sales of the Product in the Territory (the “Invoiced
Sales”), less the following deductions to the extent included in the gross invoiced sales price for the Product or otherwise directly paid or incurred by Mereo or its Affiliates with respect to the sale of the Product: 

  
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	 	(a)	trade, quantity, governmental or cash discounts, credits, adjustments or allowances, including those granted on account of price adjustments, billing errors, rejected goods or damaged goods or goods otherwise not in
saleable condition; 

  

	 	(b)	rebates and chargebacks allowed, given or accrued to customers and Third Parties (including cash, governmental and managed care rebates, hospital or other buying group chargebacks, and governmental taxes in the nature
of a rebate based on usage levels or sales of the Product); 

  

	 	(c)	taxes related to [***] assessed on the sale of the Product; 

  

	 	(d)	any other similar and customary deductions that are consistent with Accounting Standards; 

  

	 	(e)	to the extent amounts from a prior period are not collected and are written off by Mereo, including bad debts, the lesser of (i) [***] and (ii) [***], provided that if any such amounts are subsequently collected, they
will be included in the calculation of Net Sales; and 

  

	 	(f)	an allowance for transportation costs, distribution expenses, special packaging and related insurance charges, freight and insurance charges, taken in accordance with Purchaser’s standard practices applicable to
other of Purchaser’s products, which allowance will in no event exceed [***] of the amount arrived at after application of items (a) to (d) above.  

Subject to the above, Net Sales shall be calculated in accordance with Accounting Standards. For the avoidance of doubt, in the case of any
sale or other disposal of a Product between or among Mereo and its Affiliates for resale, invoiced sales and Net Sales shall be calculated only on the amount invoiced on the first arm’s length sale thereafter to a Third Party, provided that in
each case: 
  

	 	(i)	the following will not be included in Net Sales: 

  

	 	(A)	transfers or dispositions for charitable, promotional, pre-clinical, clinical, regulatory, compassionate use, named patient use, indigent programs or governmental purposes;

  

	 	(B)	commercially reasonable quantities of Product used as samples to promote additional Net Sales; and 

  

	 	(C)	Product provided for use in the Development of Products; and 

  

	 	(D)	sales or transfers between or among Mereo, its Affiliates or Sublicensees; 

  

	 	(ii)	 in the event that a Product is sold as part of a Combination Product, Net Sales of the Product, shall be
determined by multiplying Net Sales of the Combination Product by the fraction A/(A+B), where A is the weighted (by sales volume) average sales price of the Product when sold separately in finished form and B is the weighted average sale

  
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price of the other product(s) sold separately in finished form. In the event that such average sales price cannot be determined for both the Product and the other product(s) in combination, Net
Sales for purposes of determining payments hereunder shall be mutually agreed by the Parties based on the relative value contributed by each component, and such agreement shall not be unreasonably withheld. 

 

	1.71	“Non-Breaching Party” has the meaning set forth in Section 14.2.1. 

  

	1.72	“Notice Period” shall have the meaning set forth in Section 14.2.1. 

  

	1.73	“Ongoing MTAs” means those ongoing material transfer agreements between AstraZeneca or an Affiliate of AstraZeneca and a Third Party, which relate to the Compounds, each as
described in more detail on Schedule 1.129. 

  

	1.74	“Ongoing Research Agreements” means [***]; and [***] the Ongoing MTAs, each as described in more detail on Schedule 1.129. 

 

	1.75	“Option” shall have the meaning set forth in Section 2.1.3. 

  

	1.76	“Option Exercise Date” shall have the meaning set forth in Section 2.1.3(b). 

  

	1.77	“Option Know-How” means (i) any Information which is owned by AstraZeneca or any of its Affiliates as of the Effective Date or which is owned or Controlled
by AstraZeneca or any of its Affiliates under the Transferring Contracts and Additional Studies following the Effective Date and prior to the effective date of the assignment of the relevant Transferring Contract or Additional Study, in each case,
that (ii) relates [***] to the Compounds. 

  

	1.78	“Option Intellectual Property” means (a) the Option Know-How and (b) the Option Patents (i) which are owned by AstraZeneca or any of its Affiliates
as of the Effective Date as well as any Information which is owned or Controlled by AstraZeneca or any of its Affiliates under the Transferring Contracts and Additional Studies following the Effective Date and prior to the effective date of the
assignment of the relevant Transferring Contract or Additional Study and, in each case, that (ii) relate [***] to the Compounds or Products. 

  

	1.79	“Option Patents” means those Patents that are owned by AstraZeneca or any of its Affiliates as of the Effective Date and listed in Schedule 1.79 and any Patents at any time during the term of the
Agreement claiming priority thereto or to any application from which such Patents have issued. 

  

	1.80	“Ordinary Shares” has the meaning set forth in the Subscription Deed; 

  

	1.81	“Parent Company Guarantee” means the guarantee entered into on even date herewith between AstraZeneca and MBGP, pursuant to which MBGP agrees to guarantee Mereo’s obligations hereunder.

  

	1.82	“Party” and “Parties” have the meaning set forth in the preamble hereto. 

  
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	1.83	“Patents” means: (i) all national, regional and international patents and patent applications, including provisional patent applications; (ii) all patent applications filed either from such
patents, patent applications or provisional applications or from an application claiming priority from either of these, including divisionals, continuations,
continuations-in-part, provisionals, converted provisionals, non-provisionals, PCTs, and continued prosecution applications; (iii) any and all patents that have
issued or in the future issue from the foregoing patent applications ((i) and (ii)), including utility models, petty patents, innovation patents and design patents and certificates of invention; (iv) any and all extensions or restorations by
existing or future extension or restoration mechanisms, including revalidations, reissues, re-examinations and extensions (including any supplementary protection certificates and the like) of the foregoing
patents or patent applications ((i), (ii) and (iii)); and (v) any similar rights, including so-called pipeline protection or any importation, revalidation, confirmation or introduction patent or
registration patent or patent of additions to any of such foregoing patent applications and patents. 

  

	1.84	“Payment” has the meaning set forth in Section 8.10.1. 

  

	1.85	“Person” means an individual, sole proprietorship, partnership, limited partnership, limited liability partnership, corporation, limited liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or other similar entity or organization, including a government or political subdivision, department or agency of a government. 

 

	1.86	“[***]” means (i) a human clinical trial of a Product [***] (e.g., in the United States such clinical trial is conducted [***]) and to [***] in patients with the disease or
condition being studied and to [***], for purposes of filing an NDA or MAA for Product, and that would satisfy the requirements under [***], or (ii) any other clinical trial that is intended to establish [***], and to determine [***], which
clinical trial is a [***] as evidenced by [***]. 

  

	1.87	“[***]” has the meaning set forth in Section 8.3.3. 

  

	1.88	“[***]” has the meaning set forth in Section 8.3.1. 

  

	1.89	“[***]” has the meaning set forth in Section 8.3.2 

  

	1.90	“[***]” means [***] or [***] or other [***] to the [***] of [***] (including an [***] of any [***] of [***] or [***] and [***] instead of the [***] or [***] of a [***]). 

 

	1.91	“[***] Success Payments” means the [***], the [***] and the [***]. As provided in Section 2.1.3, within [***] days following the payment of all [***] Success Payments and the issuance of [***] and
[***], Mereo shall have the right to exercise the Option. 

  

	1.92	“[***]” means a study in patients [***]. 

  

	1.93	 “Product” means any product that is comprised of or contains a Compound, alone or in combination
with one (1) or more other API, in any and all forms, presentations, dosages and formulations. “Product” includes (a) a Product that includes as an API the 9668 Compound (a “9668 Product”)[***]. For clarity,
(i) the 9668 Product 

  
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[***] shall be considered different Products, (ii) all forms, presentations, dosages and formulations of the 9668 Product, and all combinations of the 9668 Product with one or more other
APIs, shall collectively be deemed to be one and the same Product, and (iii) [***]. 

  

	1.94	“Product Agreement” means, with respect to a Product [***], any agreement entered into by and between Mereo or any of its Affiliates or its or their Sublicensees, on the one hand and one (1) or
more Third Parties, on the other hand, that is [***] for the Exploitation of such Product in the Field in the Territory, including (i) any agreement pursuant to which Mereo, its Affiliates or its or their Sublicensees receives any license or
other rights to Exploit such Product, (ii) supply agreements pursuant to which Mereo, its Affiliates or its or their Sublicensees obtain or will obtain quantities of such Product, (iii) clinical trial agreements, (iv) contract
research organization agreements and (v) service agreements. 

  

	1.95	“Product Know-How” means the Option Know-How and the Related Know-How.

  

	1.96	“Product Intellectual Property” means the Option Intellectual Property and the Related Know-How. 

 

	1.97	“Prosecuting Party” has the meaning set forth in Section 9.2.1. 

  

	1.98	“Regulatory Approval” means, with respect to a country in the Territory, any and all approvals (including Drug Approval Applications), licenses, registrations or authorizations of any Regulatory
Authority necessary to distribute, market, sell or offer for sale a Product in such country, including, where applicable, (i) pricing or reimbursement approval in such country, (ii) marketing authorizations (including any prerequisite
Manufacturing approval or authorization related thereto) and (iii) labelling approval. 

  

	1.99	“Regulatory Authority” means any applicable supra-national, federal, national, regional, state, provincial or local regulatory agencies, departments, bureaus, commissions, councils or other government
entities regulating or otherwise exercising authority with respect to the Exploitation of Compounds or Products in the Territory, including the FDA in the United States and the EMA in the European Union (including any successor authority in respect
of the United Kingdom). 

  

	1.100	“Regulatory Documentation” means: all (i) applications (including all INDs and Drug Approval Applications), registrations, licenses, authorizations and approvals (including Regulatory Approvals);
(ii) correspondence and reports submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority) and all supporting documents with respect thereto,
including all adverse event files and complaint files; and (iii) clinical and other data contained or relied upon in any of the foregoing; in each case ((i), (ii) and (iii)) relating to a Compound or a Product. 

 

	1.101	 “Related Know-How” means (i) any Information which
is owned or Controlled by AstraZeneca or any of its Affiliates as of the Effective Date as well as any Information which is owned or Controlled by AstraZeneca or any of its Affiliates under the Transferring Contracts and Additional Studies following
the Effective Date 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 11 

	 	
and prior to the effective date of the assignment of the relevant Transferring Contract or Additional Study and, in each case, that is (ii) reasonably necessary or intended for use in
connection with the Development or Exploitation of Product(s) in the Field in the Territory. Related Know-How excludes the Option Know-How and excludes [***].

  

	1.102	“Remaining API” means all Compound API in AstraZeneca’s or its Affiliates’ possession or control which were not allocated as of the Effective Date for use in AstraZeneca’s then Ongoing
Research Agreements, [***], provided that on the effective date of transfer of a given Ongoing Research Agreement to Mereo, the amount of such Compound API required for such Ongoing Research Agreement shall become Remaining API always with the
exception that [***] of [***] and [***]. 

  

	1.103	“Retained Rights” mean, with respect to the Compounds and Products in the Field in the Territory, the rights of AstraZeneca, its Affiliates and its and their licensors, (sub)licensees and contractors to
perform its and their obligations under this Agreement. 

  

	1.104	“Royalty Term” means, on a Product-by-Product and
country-by-country basis, the period beginning on the date of the First Commercial Sale of such Product in such country and ending on the latest to occur of:
(i) ten years from such First Commercial Sale or (ii) the expiration of the last-to-expire Valid Claim of an Option Patent in such country that, if asserted
against a Person, would, in the absence of a license, be sufficient to prevent the sale or use by such Person of all Generic Versions of such Product in such country. 

 

	1.105	“[***]” has the meaning set forth in clause 1.2 of the Subscription Deed. 

  

	1.106	“[***]” has the meaning set forth in clause 1.2 of the Subscription Deed. 

  

	1.107	“Senior Officer” means, with respect to AstraZeneca, [***] and with respect to Mereo, [***].  

  

	1.108	“Sublicensee” means a Person, other than an Affiliate, that is granted a sublicense by Mereo or its Affiliate under the grants in Section 2.1, as provided in Section 2.2, but excluding any
distributor, and which shall include any Person that is granted a licence under the Option Intellectual Property following Mereo’s exercise of the Option. 

  

	1.109	 “Sublicensing Consideration” means [***] payments received by Mereo or its Affiliates from a
Sublicensee in consideration for the grant of a license, waiver from suit or equivalent rights under any Product Intellectual Property in the form of [***]; provided, however, Sublicensing Consideration does not include payments received by Mereo or
its Affiliates from Sublicensees for (a) the purchase of equity to the extent [***]) or issuance of debt instruments ([***]); (b) reimbursement for bona fide development expenses incurred by Mereo or its Affiliates (c) amounts received as
consideration for the grant of a license, sublicense, waiver from suit or equivalent rights under any technology or intellectual property other than the Product Intellectual Property, whether [***] or [***], based on a [***] taking into account the
relative value of the Product Intellectual Property and those other rights; (d) amounts received for supply of Compound, or Product to a Sublicensee for [***] the [***], or for the

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 12 

	 	
[***] of [***] (including for [***]) to the extent [***]; (e) reimbursement of the amount paid for [***] by Mereo, such as [***] or [***] to [***]; (f) any payments made to Mereo for Mereo’s
performance of services, including Development or Commercialization services. For clarity, any consideration received in connection with any merger, consolidation, acquisition, divestment or asset sale by Mereo or MBGP is not Sublicensing
Consideration hereunder. 

  

	1.110	“Subscription Deed” means that certain ordinary shares subscription deed between MBGP and AstraZeneca and dated as of the Effective Date. 

 

	1.111	“Subscription Shares” shall have the meaning set forth in the Subscription Deed. 

  

	1.112	“Tax” or “Taxation” means any form of tax or taxation, levy, duty, charge, social security charge, contribution, or withholding of whatever nature (including any related fine, penalty,
surcharge or interest) imposed by, or payable to, a Tax Authority. 

  

	1.113	“Tax Authority” means any government, state or municipality, or any local, state, federal or other fiscal, revenue, customs or excise authority, body or official anywhere in the world, authorized to
levy Tax. 

  

	1.114	“Tech Transfer Support” has the meaning given in Section 4.1.1. 

  

	1.115	“Tech Transfer Support Period” has the meaning set forth in Section 4.1.2. 

  

	1.116	“Term” has the meaning set forth in Section 14.1. 

  

	1.117	“Termination Notice” has the meaning set forth in Section 14.2.1. 

  

	1.118	“Territory” means world-wide. 

  

	1.119	“[***]” has the meaning set forth in clause 1.2 of the Subscription Deed. 

  

	1.120	“[***]” has the meaning set forth in clause 1.2 of the Subscription Deed; 

  

	1.121	“Third Party” means any Person other than AstraZeneca, Mereo and their respective Affiliates. 

  

	1.122	“Third Party Claims” has the meaning set forth in Section 13.1. 

  

	1.123	“Third Party Infringement Claim” has the meaning set forth in Section 9.4. 

  

	1.124	“Third Party Patent Right” has the meaning set forth in Section 9.6. 

  

	1.125	“Third Party Payments” means the aggregate of [***] payments (including for [***]) Mereo, its Affiliates or Sublicensees pay directly to a Third Party for rights under patents or know-how controlled by such Third Party necessary for the manufacture, use or sale of Products. For avoidance of doubt, [***] payments by Mereo, its Affiliates or Sublicensees for licenses to Patents or Information
generated by the Ongoing Research Agreements or Additional Studies will be included in Third Party Payments. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 13 

	1.126	“Top Line Data” means with respect to a clinical study, a summary of demographic data, the data for the primary endpoint and a summary of safety data. 

 

	1.127	“Top Line Data Date” means the date on which Mereo provides AstraZeneca with a copy of its Top Line Data from the first [***] for a Product. 

 

	1.128	“Transfer Activities” means those activities to be performed by AstraZeneca as set out in Sections 3.1 and 4. 

  

	1.129	“Transferring Assets” means those assets to be transferred by AstraZeneca to Mereo pursuant to Section 3.1, as set forth on Schedule 1.129. 

 

	1.130	“Transferring Contracts” means the Ongoing Research Agreements, each as set out in Schedule 1.129. 

  

	1.131	“Transferring Regulatory Documentation” means Regulatory Documentation owned by AstraZeneca or any of its Affiliates as of the Effective Date [***] related to the Product(s) in the Field in the
Territory. 

  

	1.132	“TUPE” means the Transfer of Undertakings (Protection of Employment) Regulations 2006 of the United Kingdom. 

  

	1.133	“United Kingdom” means the United Kingdom and its territories and possessions. 

  

	1.134	“United States” or “U.S.” means the United States of America and its territories and possessions (including the District of Columbia and Puerto Rico). 

 

	1.135	“Valid Claim” means a claim of any issued and unexpired Patent whose validity, enforceability or patentability has not been affected by (a) irretrievable lapse, abandonment, revocation, dedication
to the public or disclaimer or (b) a holding, finding or decision of invalidity, unenforceability or non-patentability by a court, governmental agency, national or regional patent office or other
appropriate body that has competent jurisdiction, such holding, finding or decision being final and unappealable or unappealed within the time allowed for appeal.  

 

	1.136	“VAT” has the meaning set forth in Section 8.10.2. 

  

	2.	GRANT OF RIGHTS 

  

	2.1	Grants to Mereo 

 Subject to the terms and conditions of this Agreement, AstraZeneca
hereby grants to Mereo: 
  

	2.1.1	subject to Section 2.3, an exclusive (even as to AstraZeneca and its Affiliates) license, with the right to grant sublicenses in accordance with Section 2.2, under the Option Intellectual Property to Exploit
the Compounds and Products in the Field in the Territory; 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 14 

	2.1.2	a non-exclusive license, with the right to grant sublicenses in accordance with Section 2.2, under the Related Know-How to Exploit the
Compounds and Products in the Field in the Territory; and 

  

	2.1.3	an exclusive option, exercisable any time within [***] days following: (i) payment by Mereo to AstraZeneca of all [***] Success Payments; (ii) [***]; and (iii) [***], to require the transfer to Mereo of all right,
title and interest of AstraZeneca and any of its respective Affiliates to the Option Intellectual Property (the “Option”) for the consideration stated in Section 8, exercisable as follows: 

 

	 	(a)	within the [***] day period referred to above in this Section 2.1.3, Mereo may provide AstraZeneca with written notice that it desires AstraZeneca to transfer to Mereo all of AstraZeneca’s and its respective
Affiliates’ right, title and interest of to the Option Intellectual Property; and 

  

	 	(b)	effective upon the date AstraZeneca receives such notice (“Option Exercise Date”), AstraZeneca shall cause its respective Affiliates to, grant, sell, transfer, convey, assign and deliver to Mereo, and
Mereo shall accept from AstraZeneca or any of its respective Affiliates all of AstraZeneca and any of its respective Affiliates’ right, title and interest of to, the Option Intellectual Property, including any and all rights to bring proceeding
and obtain all remedies in respect of any infringement or unauthorized use of the Option Intellectual Property, irrespective of when such infringement occurred or occurs (including prior to the Effective Date), by way of an assignment agreement to
be agreed between the Parties acting reasonably. 

  

	 	(c)	For clarity, if Mereo exercises the Option, the license granted in Section 2.1.1 will expire once all of AstraZeneca’s and any of its respective Affiliates’ right, title and interest to the Option
Intellectual Property has been sold, transferred, conveyed, assigned and delivered to Mereo (including the perfection of the relevant transfers), but Mereo’s obligations under this Agreement shall continue, including Mereo’s obligation to
make payments to AstraZeneca as set forth in Section 8. 

  

	2.2	Sublicenses 

  

	2.2.1	Mereo shall have the right to grant sublicenses (or licences or further rights of reference, as applicable), through multiple tiers, under the licenses and rights granted in Section 2.1 (a) to its Affiliates upon
notice to AstraZeneca but without consent and (b) to Third Party only with the prior written consent of AstraZeneca (not to be unreasonably withheld), and provided that in each case such license or sublicense is consistent with the terms and
conditions of this Agreement and provided that Mereo shall be liable for all acts or omissions of any Sublicensee that, if committed by Mereo, would be a breach of any of the provisions of this Agreement. 

 

	2.2.2	Mereo shall remain at all times responsible for the performance of its Affiliates and permitted Sublicensees that are sublicensed as permitted herein and the grant of any such license or sublicense shall not relieve
Mereo of its obligations under this Agreement, except to the extent such obligations are performed by such Sublicensee. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 15 

	2.3	Retained Rights 

 Mereo acknowledges and agrees that AstraZeneca retains the right for
AstraZeneca or its Affiliates to enter into the Additional Studies solely as set out in Section 5.6 and Mereo hereby grants to AstraZeneca a non-exclusive license, with the right to grant sublicenses in
accordance with Section 2.2, expiring upon the assignment of the relevant agreement to Mereo in accordance with Section 5.6, under the Option Intellectual Property solely to the extent required to perform research, pre-clinical and other non-clinical testing pursuant to the agreements governing the conduct of the Additional Studies, in each case as [***] in accordance with
Section 5.6.1. 
  

	2.4	No Other Rights Granted by AstraZeneca 

 Except as expressly provided herein, neither
AstraZeneca or any of its Affiliates grants any other right or license, including any rights or licenses to the Product Intellectual Property or any other Patent or other intellectual property rights. 

 

	2.5	Non-Compete 

 For a period of three
(3) years following the Effective Date, AstraZeneca shall not and shall cause its Affiliates not to (a) directly or indirectly Commercialize or Develop any Competitive Product in the Territory or (b) [***] to Commercialize or Develop any
Competitive Product in the Territory. AstraZeneca agrees that this Section 2.5 is reasonable and necessary to protect Mereo’s legitimate business interest. AstraZeneca will not, during the Term, [***]. The Parties agree that, in the event
that a court of competent jurisdiction determines that this Section 2.5 is unenforceable as written, the court should enforce this Section 2.5 to render it valid and enforceable to the maximum extent possible. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 16 

	2.6	Non-Assert 

 AstraZeneca hereby covenants and
agrees that it shall not, and shall cause that its Affiliates do not, sue, or support or encourage any Third Party in suing, any Mereo Party claiming that the manufacture, having manufactured, use, distribution, sale, offering for sale, or
importation of any Product or any component thereof permitted under this Agreement for sale in the Territory as of or after the Effective Date infringes or misappropriates any intellectual property rights AstraZeneca and / or its Affiliates may have
in or to the Products. AstraZeneca shall impose the foregoing covenant not-to-sue on (i) its Affiliates and (ii) any Third Party to which AstraZeneca or any of
its Affiliates may assign, exclusively license or [***] to the foregoing intellectual property rights. The Parties expressly agree and intend that the covenants and agreements set forth in this Section 2.6 shall run with such intellectual
property right, as a covenant appurtenant, and shall continue and be binding on any successor-in-interest to such intellectual property right. For the purposes of this
Section 2.6, “Mereo Party” means (a) Mereo and its Affiliates, and (b) Mereo’s and its Affiliates’ licensees, sublicensees, suppliers, distributors, importers, contractors, direct or indirect customers (including
without limitation [***]), and manufacturers of the Products, in each case to the extent that such party makes, has made, uses, distributes, sells, offers for sale, or imports the products (or components thereof) referenced above in the Territory
for Mereo or its Affiliates in accordance with this Section 2. 
  

	3.	TRANSFER OF ASSETS, MATERIALS 

  

	3.1	Transferring Assets. 

 Subject to Section 5.5, on the Effective Date, in accordance
with the terms and conditions of this Agreement, for the consideration stated in Section 8, AstraZeneca shall and hereby does, and shall cause its respective Affiliates to, grant, sell, transfer, convey, assign and deliver to Mereo, and Mereo
shall accept from AstraZeneca or any of its respective Affiliates, as of the Effective Date, all right, title and interest of AstraZeneca and any of its respective Affiliates to the Transferring Assets. 

 

	3.2	Remaining API 

 AstraZeneca hereby agrees, and shall cause its respective Affiliates, to
grant, sell, transfer, convey, assign and deliver to Mereo, and Mereo shall accept from AstraZeneca or any of its respective Affiliates the Remaining API. AstraZeneca shall deliver all quantities of the Remaining API to its or its nominated
designee’s facility [***] within [***]. The Parties agree that: (i) such Remaining API shall be used solely for the Development of the Compounds or Products pursuant to this Agreement; and (ii) such Remaining API shall not be made
available by Mereo to any Third Party except as expressly consented to in writing by AstraZeneca, provided that Mereo may make such Remaining API available to a subcontractor or Sublicensee of Mereo. WITHOUT PREJUDICE TO SECTION 11.2, MEREO AGREES
THAT ALL SUCH REMAINING API IS PROVIDED “AS IS” AND WITHOUT ANY WARRANTIES, EXPRESS OR IMPLIED. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 17 

	3.3	Materials 

 Notwithstanding Sections 3.1 and 3.2, the Parties agree that Mereo shall
[***] to source all materials (including API) necessary for the Development, Commercialization and Manufacture of Products from a Third Party. AstraZeneca shall provide Mereo and such Third Party supplier(s) with reasonable assistance in connection
with the qualification, validation and onboarding of such Third Party supplier during the Tech Transfer Support Period [***], and following the expiry of such period, [***] (a) [***] of [***] to [***] such [***] at the [***] and (b) [***] and [***]
in [***], in each case as [***] in [***] the [***]. 
  

	3.4	TUPE 

 Notwithstanding the transfer of the Transferring Assets, each Party confirms that
it does not consider TUPE will apply to the commencement or termination of this Agreement or to the transactions contemplated hereby. 
  

	4.	TECHNOLOGY TRANSFER 

  

	4.1	Transfer Activities 

  

	4.1.1	In addition to its obligations under Section 3.2, AstraZeneca will provide reasonable access to and make its qualified and technical personnel with knowledge of the research and development of the Compounds, as
reasonably required to assist with the transfer of such Product Know-How, reasonably available to Mereo in person at AstraZeneca’s facilities or by teleconference during normal business hours to
(a) facilitate the transfer of Product Know-How in accordance with Section 4.1.3 and the Transferring Assets and (b) assist Mereo in familiarizing its personnel with any intellectual property
comprised in the Transferred Assets ((a) and (b) together being the Tech Transfer Support”). Representatives of AstraZeneca and Mereo shall meet in person or by teleconference as reasonably required, to facilitate the timely and
efficient transfer of knowledge and technology. 

  

	4.1.2	AstraZeneca shall provide Mereo with the Tech Transfer Support for a period of [***] months following the Effective Date (the “Tech Transfer Support Period”) provided that: (a) [***] for the
[***] of the [***] of [***] by [***]; and, (b) [***] the [***] of [***] to [***] (a), [***] by [***] at [***] (i) [***] of [***] to [***] such [***] at the [***] and (ii) [***] and [***] in connection therewith, in each case as agreed [***].

  

	4.1.3	AstraZeneca shall make available and deliver to Mereo all documented then existing Product Know-How in AstraZeneca’s possession that has not previously been provided
hereunder no later than [***] days after the Effective Date, and thereafter no later than [***] days after the creation of the relevant Option Know-How, [***]. 

 

	5.	DEVELOPMENT ACTIVITIES 

  

	5.1	Diligence 

 After the Effective Date and after completion of relevant Transfer
Activities, Mereo shall be solely responsible for all aspects of the Development of the Compounds and Products in the Field in the Territory. Mereo shall use Commercially Reasonable Efforts to Develop and obtain and maintain Regulatory Approvals for
a Product for use in the Field in the Territory. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 18 

	5.2	Development Costs 

 Mereo shall be responsible for all of its costs and expenses in
connection with the Development of, and obtaining and maintaining Regulatory Approvals for, the Products in the Field in the Territory. 
  

	5.3	Development Records 

 Mereo shall, and shall cause its Affiliates and its and their
Sublicensees to, maintain, in good scientific manner, complete and accurate books and records pertaining to Development of Products hereunder, in sufficient detail to verify compliance with its obligations under this Agreement. Such books and
records shall be retained by Mereo for at least [***] years after the expiration or termination of this Agreement in its entirety or for such longer period as may be required by Applicable Law. 

 

	5.4	Development Reports 

 Within [***] days following the end of each [***] during the
Development Report Period, Mereo shall provide AstraZeneca with a written summary of the Development activities it has performed, or caused to be performed, since the preceding report, its Development activities in process and the future activities
it expects to initiate during the following [***] month period. Each such report shall contain information to enable AstraZeneca to assess Mereo’s compliance with its obligations set forth in Section 5.1 

 

	5.5	Ongoing Research Agreements 

  

	5.5.1	Within [***] days following the Effective Date, AstraZeneca shall [***], and cause its Affiliates to [***], to assign all of its right, title and interest in and to the Ongoing Research Agreements to Mereo by way of an
assignment and assumption agreement to be agreed between the Parties acting reasonably unless, with respect to any such Ongoing Research Agreements, such Ongoing Research Agreements do not permit such assignment, in which case AstraZeneca (or such
Affiliate) shall cooperate with Mereo in all reasonable respects to negotiate a novation agreement with such Third Party in a form reasonably acceptable to Mereo in respect of such Ongoing Research Agreement, provided that [***], and if any such
novation cannot be obtained with respect to an Ongoing Research Agreement, AstraZeneca shall use good faith efforts, and cause its Affiliates to use good faith efforts, to obtain for Mereo [***] of the practical benefit and burden under such Ongoing
Research Agreement, including by [***] and for the account of Mereo, any and all rights of AstraZeneca (or such Affiliate) against the other party thereto arising out of the breach or cancellation thereof by such other party or otherwise.
AstraZeneca shall keep Mereo reasonably informed as to the status of any such transfer and shall reasonably take into account any comments made by Mereo. 

  

	5.5.2	In the event that any intellectual property rights are created under the Ongoing Research Agreements that fall within the definition of Option Intellectual Property, then, in the event such Ongoing Research Agreements
have not been assigned to Mereo pursuant to Section 5.5.1 above, AstraZeneca shall use [***], and shall cause its Affiliates to [***] to, within [***] days following the creation thereof, assign all of its right, title and interest in and to
such intellectual property rights to Mereo, by way of an assignment agreement to be agreed between the Parties acting reasonably. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 19 

	5.6	Additional Studies 

  

	5.6.1	The Parties recognize that AstraZeneca or its Affiliates are currently in the process of negotiating or have recently executed certain Additional Studies with potential Third Party partners in relation to the Compounds.
Following the Effective Date, AstraZeneca shall keep Mereo informed as to the negotiation status of such Additional Studies, if applicable, and shall [***], including by [***] Following the conclusion of such negotiations, if applicable, AstraZeneca
or its Affiliates or Mereo, as agreed between the Parties, shall enter into agreements governing the conduct of such Additional Studies, provided that [***] 

  

	5.6.2	Following the later of (a) the Effective Date or (b) the date of execution of the agreement governing an Additional Study, AstraZeneca shall promptly provide Mereo with fully executed copies of the relevant
agreements and provide such information as Mereo reasonably requires relating thereto. 

  

	5.6.3	Following the execution of any agreements described in Section 5.6 governing Additional Studies, such agreements shall be promptly assigned by AstraZeneca to Mereo by way of an assignment and assumption agreement
to be agreed between the Parties acting reasonably and Mereo, following such assignment, shall assume AstraZeneca’s rights, obligations and liabilities thereunder occurring from and after the assignment date. 

 

	5.6.4	Following any such assignment: 

  

	 	(a)	Mereo shall be the sponsor for the applicable clinical trials and studies under such Additional Studies; 

  

	 	(b)	AstraZeneca shall agree in writing to provide directly to Mereo available compound and drug product for such Additional Studies, to the extent the same are in AstraZeneca’s possession as of the date of execution of
agreements governing the conduct of the Additional Studies described in Section 5.6. Except as provided in the immediately preceding sentence, AstraZeneca shall have no further obligation to manufacture or procure the manufacture of relevant
compound or drug product thereafter and any such obligations under the Applicable Studies shall pass to Mereo; 

  

	 	(c)	Any funding obligations under the Additional Studies shall, as between the Parties, be assumed by and be the responsibility of [***]; and 

 

	 	(d)	AstraZeneca shall have no rights relating to such Additional Studies, including any rights to any resulting clinical data or intellectual property rights. 

 

	6.	REGULATORY ACTIVITIES 

  

	6.1	Regulatory Approvals 

 Subject to the Retained Rights, Mereo shall have the sole right to
prepare, obtain and maintain Drug Approval Applications (including the setting of the overall regulatory strategy therefor), other Regulatory Approvals and other submissions (including INDs) and to conduct communications with the Regulatory
Authorities, for Products in the Field in the Territory in its name. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 20 

	6.2	Recalls, Suspensions or Withdrawals 

 Prior to exercise of the Option pursuant to
Section 2.1.3, Mereo shall notify AstraZeneca following its determination that any event, incident or circumstance has occurred that may result in the need for a recall, market suspension or market withdrawal of a Product in the Field in the
Territory and shall include in such notice the reasoning behind such determination and any supporting facts. As between the Parties, Mereo shall have the right to make the final determination whether to voluntarily implement any such recall, market
suspension or market withdrawal in the Field in the Territory. If a recall, market suspension or market withdrawal is mandated by a Regulatory Authority in the Territory, as between the Parties, Mereo shall initiate such a recall, market suspension
or market withdrawal in compliance with Applicable Law. For all recalls, market suspensions or market withdrawals undertaken pursuant to this Section 6.2, as between the Parties, Mereo shall be solely responsible for the execution thereof. For
clarity, on or after the exercise of the Option pursuant to Section 2.1.3, Mereo shall have the sole right and obligation to determine whether to implement any recall, market suspension or market withdrawal in the Field in the Territory and
Mereo shall be solely responsible for the execution thereof and shall be under no obligation to notify AstraZeneca thereof. Mereo shall be responsible for all costs of any recall, market suspension or market withdrawal, except in the event and to
the extent that a recall, market suspension or market withdrawal resulted from AstraZeneca’s or its Affiliate’s breach of its obligations hereunder or from such AstraZeneca’s or its Affiliate’s fraud, gross negligence or willful
misconduct, in which case, AstraZeneca shall bear the expense of such recall, market suspension or market withdrawal. 
  

	6.3	Global Safety Database 

 Mereo shall establish, hold and maintain (at Mereo’s sole
cost and expense) the global safety database for Products as required under Applicable Law. Mereo shall provide AstraZeneca with such safety information, including adverse event reports, relating to the Products as AstraZeneca reasonably requires,
including to enable AstraZeneca to respond to a request from any applicable Regulatory Authority. To the extent that AstraZeneca requires Mereo to provide AstraZeneca with safety information that constitutes personal data under Applicable Laws
relating to privacy pursuant to this Section 6.3, the Parties will agree on reasonable terms for such disclosure in order to ensure compliance with the requirements of Applicable Laws relating to privacy on each Party. 

 

	7.	COMMERCIALIZATION 

  

	7.1	Diligence 

 As between the Parties, Mereo shall be solely responsible for
Commercialization of the Products in the Field throughout the Territory at Mereo’s own cost and expense. Mereo shall use Commercially Reasonable Efforts to Commercialize the Products throughout the Territory. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 21 

	7.2	Commercialization Costs; Booking of Sales; Distribution 

 Except as otherwise provided in
this Agreement, as between the Parties Mereo shall be responsible for all costs and expenses in connection with the Commercialization of the Products in the Field in the Territory. Mereo shall invoice and book sales, establish all terms of sale
(including pricing and discounts) and warehouse and distribute the Products in the Field in the Territory and perform or cause to be performed all related services. Mereo shall handle all returns, recalls or withdrawals, order processing, invoicing,
collection, distribution and inventory management with respect to the Products in the Territory. 
  

	7.3	Commercialization Records 

 Mereo shall maintain complete and accurate books and records
pertaining to Commercialization of Products hereunder, in sufficient detail to verify compliance with its obligations under this Agreement and which shall be in compliance with Applicable Law and properly reflect all work done and results achieved
in the performance of its Commercialization activities. Such records shall be retained by Mereo for at least [***] years after the expiration or termination of this Agreement in its entirety or for such longer period as may be required by Applicable
Law. 
  

	7.4	Commercialization Reports 

 Without limiting Section 5.4, within [***] days
following the end of each [***], during the Royalty Term, Mereo shall provide to AstraZeneca a written summary of the Commercialization activities it has performed, or caused to be performed, including a summary of all relevant financial data
relating to such activities since the preceding report. 
  

	8.	PAYMENTS AND RECORDS 

  

	8.1	Upfront Payment 

 In partial consideration of the rights granted by AstraZeneca to Mereo
hereunder, Mereo shall within [***] of the Effective Date make a non-refundable and non-creditable cash payment to AstraZeneca equal to three million US Dollars
(USD$3,000,000). 
  

	8.2	Issue of Loan Notes 

  

	8.2.1	In partial consideration of the rights granted by AstraZeneca to Mereo hereunder, Mereo will issue to MBGP: 

  

	 	(a)	Loan Note 1 within [***] days of the Effective Date; 

  

	 	(b)	Loan Note 2 no later than the date upon which the [***] becomes due and payable pursuant to Section [***] (or, if earlier, no later than the date of any [***]); and 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 22 

	 	(c)	Loan Note 3 no later than the date upon which the [***] becomes due and payable pursuant to Section [***] (or, if earlier, no later than the date of any [***]).  

 

	8.2.2	Loan Note 1, Loan Note 2 and Loan Note 3 shall constitute the consideration for the allotment and issue of the Subscription Shares to be subscribed for by, and issued credited as fully paid to, AstraZeneca pursuant to
clauses 2.1, 2.2 and 2.3, respectively, of the Subscription Deed. Mereo shall issue the Loan Notes on such terms as enable MBGP to credit the Subscription Shares as fully paid on their allotment and issue to AstraZeneca in accordance with the terms
of the Subscription Deed. 

  

	8.3	[***] Success Payments 

 In partial consideration of the rights granted by AstraZeneca to
Mereo hereunder, Mereo shall make the following one-time payments to AstraZeneca as follows, for the first of the 9668 Product [***] to satisfy such milestone event: 

 

	8.3.1	within [***] days of Mereo or its Affiliate [***] to [***] that the first [***] for the first Product has achieved [***], Mereo shall make a non-refundable cash payment to
AstraZeneca of [***] US Dollars (USD[***], subject to adjustment pursuant to Section 8.15.1 (“[***]”); and 

  

	8.3.2	within [***] days of [***] by Mereo or its Affiliates of the [***] the first [***] for the first Product that (i) [***]) [***] with [***] or other [***] such as [***] of [***] that would [***] the [***] of a [***]; or
(ii) [***] is [***] for [***] to [***] the [***] for such Product, Mereo shall make a non-refundable cash payment to AstraZeneca of [***] US Dollars (USD[***] (“[***]”), provided
that in the event that [***] that such [***] is [***] for [***] to [***] the [***] for such [***] and subsequently [***] the [***] for such [***] then [***] shall [***] within [***] days following [***]; and 

 

	8.3.3	within [***] days of Mereo or its Affiliates [***] of the first [***] for the first Product, Mereo shall make a non-refundable cash payment to AstraZeneca of [***] US Dollars
(USD[***], subject to adjustment pursuant to Section 8.15.2 (“[***]”). 

 As set forth in
Section 2.1.3, within [***] days following the [***] and the [***], Mereo shall have the right to exercise the Option.  

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 23 

	8.4	Milestones 

  

	8.4.1	Regulatory Milestones  

  

	 	(a)	In partial consideration of the rights granted by AstraZeneca to Mereo hereunder, Mereo shall pay to AstraZeneca the following payments within [***] days after the achievement of each of the following milestone events
with respect to the first Product to reach such milestone event only (unless otherwise provided below), which amounts shall be fully earned upon the achievement of the applicable milestone event: 

 

					
	 Regulatory Milestone
	  	Amount	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 TOTAL:
	  	 	[***]	 

 For the second (2nd) Indication for which a milestone is
achieved for a Product, a milestone payment shall be due but shall be reduced to [***] of the milestone amounts set forth in the table above. For the third (3rd) Indication for which a milestone
is achieved for a Product, a milestone payment shall be due but shall be reduced to [***] of the milestone amounts set forth in the table above. 

For clarity, for purposes of the payments due under this Section 8.4.1, the 9668 Product [***] shall be considered different Products.

 Each milestone in this Section 8.4.1 shall be payable on a
Product-by-Product basis based on the first achievement of such milestone for the applicable Product (subject to the paragraph immediately following the table above).

  

	8.4.2	Sales Milestones 

 In partial consideration of the rights granted by AstraZeneca to Mereo
hereunder, Mereo shall pay to AstraZeneca the following one-time payments, which shall be fully earned upon the first achievement of the applicable milestone event for each of the 9668 Product [***]: 

 

					
	 Sales Milestone
	  	Amount	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 [***]
	  	 	[***]	 
	 TOTAL PER PRODUCT:
	  	 	[***]	 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 24 

 If in a given Calendar Year more than one (1) of the milestone events set forth in the
immediately preceding table is achieved, Mereo shall pay to AstraZeneca a separate milestone payment with respect to each such threshold that is exceeded in such Calendar Year. Each such milestone payment shall be due within [***] days of the date
the milestone was achieved. Each milestone payment in this Section 8.4.2 shall be payable only upon the first achievement of such milestone in a given Calendar Year and no amounts shall be due for subsequent or repeated achievements of such
milestone in subsequent Calendar Years. 
  

	8.4.3	Determination that Milestones Have Occurred 

 Mereo shall notify AstraZeneca promptly of
the achievement of each of the events identified as a milestone in Section 8.4.1 or Section 8.4.2. In the event that, notwithstanding the fact that Mereo has not provided AstraZeneca such a notice, AstraZeneca believes that any such
milestone has been achieved, it shall so notify Mereo in writing and the Parties shall promptly meet and discuss in good faith whether such milestone has been achieved. Any dispute under this Section 8.4.3 regarding whether or not such a
milestone has been achieved shall be subject to resolution in accordance with Section 16.6. 
  

	8.5	Royalties 

  

	8.5.1	Royalty Rates 

 As further consideration for the rights granted to Mereo hereunder,
commencing upon the First Commercial Sale of a Product in the Territory, Mereo shall pay to AstraZeneca a royalty on Net Sales with respect to each Product in each country in the Territory on a Product-by-Product and country-by-country basis during each Calendar Year at the following rates: 

 

					
	 That portion of aggregate Net Sales of the Product in the Territory during a given Calendar Year
that is:
	  	 	Percentage	 
	 less than or equal to [***] US Dollars (USD$[***]).
	  	 	[***	]% 
	 greater than [***] US Dollars (USD$[***]) but less than or equal to [***] US Dollars
(USD$[***]).
	  	 	[***	]% 
	 greater than [***] US Dollars (USD$[***]) but less than or equal to [***] US Dollars
(USD$[***]).
	  	 	[***	]% 
	 greater than [***] US Dollars (USD$[***]) but less than or equal to [***] US Dollars
(USD$[***]).
	  	 	[***	]% 
	 greater than [***] US Dollars (USD$[***]).
	  	 	[***	]% 

 No multiple royalties will be payable to AstraZeneca because a Product is covered by more than one Valid Claim
in any Option Patent. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 25 

	8.5.2	Royalty Term 

 Mereo shall have no obligation to pay any royalty with respect to Net
Sales of any Product in any country after the Royalty Term for such Product in such country has expired. Upon the expiration of the Royalty Term with respect to a Product in any country, the license grants to Mereo in Section 2.1, as
applicable, with respect to such Product shall become fully paid-up with respect to such country. 
  

	8.5.3	Reductions 

  

	 	(a)	If during the Royalty Term, on a country-by-country and Product by Product basis, such Product ceases to be Covered by a Valid Claim in the
country of manufacture, use, sale, offer for sale or import but does contain, incorporate or use any Product Know-How, the applicable royalty rate will thereafter be reduced to [***] of the applicable royalty
rate set forth in Section 8.5. 

  

	 	(b)	If during the Royalty Term, on a country-by-country and Product by Product basis, one (1) or more Generic Versions of the Product are
marketed and sold in such country in a given [***] during the Royalty Term, and such that Generic Versions of the Product sold in such country equal or exceed in the aggregate [***] of the total units sold of such Product or Generic Version(s) in
such country, then the royalty rate for such Product in such country will thereafter be reduced to [***] of the applicable royalty rate set forth in Section 8.5 for so long as such reduction in units sold persists. 

 

	 	(c)	If during the Royalty Term, Mereo pays Third Party Payments with respect to a Product, Mereo may credit [***] of such Third Party Payments paid against the royalties otherwise due to AstraZeneca on the Net Sales of that
particular Product in that [***]; provided, however that the royalties paid to AstraZeneca on such Net Sales after application of such credit shall not be less than [***] of those otherwise due above without such credit. Such credit for Third Party
Payments allowed hereunder shall apply on a [***] basis, provided that Mereo shall be entitled to carry forward any amount of Third Party Payments which it is not entitled to credit from the royalties due to AstraZeneca in accordance with this
Section 8.5.3 by reason of such limitation from one (1) Calendar Year to the following Calendar Year until such amount is fully credited. 

  

	8.6	Royalty Payments and Reports 

 Mereo shall calculate all amounts payable to AstraZeneca
pursuant to Section 8.5 at the end of each Calendar Quarter, which amounts shall be converted to United States Dollars, in accordance with Section 8.7. Mereo shall pay to AstraZeneca the royalty amounts due with respect to a given Calendar
Quarter within [***] days after the end of such Calendar Quarter. Each payment of royalties due to AstraZeneca shall be accompanied by a statement specifying the amount of Net Sales and deductions taken to arrive at Net Sales attributable to each
Product in each country the Territory during the applicable Calendar Quarter (including such amounts expressed in local currency and as converted to United States Dollars using the Currency Conversion Policy and a calculation of the amount of
royalty payment due on such Net Sales for such Calendar Quarter. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 26 

	8.7	Maximum deduction 

 The maximum cumulative royalty reduction pursuant to
Section 8.5.3 shall not in any circumstances exceed [***] in any [***]. 
  

	8.8	Mode of Payment 

  

	8.8.1	All payments to AstraZeneca under this Agreement shall be made in Dollars. All amounts payable to AstraZeneca pursuant to Section 8.5 shall be made in United States Dollars. All payments to AstraZeneca under this
Agreement shall be made by deposit in the requisite amount to such bank account as AstraZeneca may from time to time designate by notice to Mereo. 

  

	8.8.2	Other than in respect of amounts payable to AstraZeneca pursuant to Section 8.5, for the purpose of calculating any sums due under, or otherwise reimbursable pursuant to, this Agreement, Mereo shall convert any
amount expressed in a foreign currency into Dollar equivalents using the Currency Conversion Policy. For the purpose of calculating any sums payable to AstraZeneca pursuant to Section 8.5 (including the calculation of Net Sales expressed in
currencies other than United States Dollars), Mereo shall convert any amount expressed in a foreign currency into United States Dollars equivalents the Currency Conversion Policy. 

 

	8.9	Sublicensing Consideration [***] 

  

	8.9.1	If Mereo sublicenses a Product to a Third Party (other than AstraZeneca) at any time then Mereo shall pay AstraZeneca [***] of all Sublicensing Consideration received pursuant to such sublicense. 

 

	8.9.2	Mereo shall not, and shall not permit its Affiliates to, [***] any Sublicensing Consideration, enter into any agreement with a Sublicensee under which the payments thereunder are (a) [***] and (b) [***]. 

  

	8.10	Taxes 

  

	8.10.1	General 

 All payments required to be made pursuant to this Agreement (each, a
“Payment”) shall be paid free and clear of any deduction or withholding for or on account of Tax, except for any withholding or deduction required by Applicable Law. Except as provided in this Section 8.10, AstraZeneca shall be
solely responsible for paying any and all taxes (other than withholding taxes required by Applicable Law to be deducted from Payments) levied on account of, or measured in whole or in part by reference to, any Payments it receives. Mereo shall
deduct or withhold from the Payments any Taxes that it is required by Applicable Law to deduct or withhold. Notwithstanding the foregoing, if AstraZeneca is entitled under any applicable tax treaty to a reduction of the rate of, or the elimination
of, applicable withholding tax, it may deliver to Mereo or the appropriate governmental authority (with the assistance of Mereo to the extent that this is reasonably required and is requested in writing) the prescribed forms necessary to reduce the
applicable rate of withholding or to relieve Mereo of its obligation to withhold such Tax and Mereo shall apply the reduced rate of withholding or dispense with withholding, as the case may be; provided that Mereo has received evidence of
AstraZeneca’s delivery of all applicable forms (and, if 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 27 

 necessary, Mereo’s receipt of appropriate governmental authorization) at least [***] days
prior to the time that the Payments are due. If, in accordance with the foregoing, Mereo withholds any amount, it shall pay to AstraZeneca the balance when due, make timely payment to the proper taxing authority of the withheld amount and send to
AstraZeneca proof of such payment within [***] days following such payment. Notwithstanding the foregoing, in the event a Party assigns its rights or obligations under this Agreement or otherwise makes Payments from a jurisdiction other than the
jurisdiction in which such party is organised (each an “Assignment”), and immediately after such Assignment the amount of Tax Deductions in respect of any Payment it makes are greater than the amount of Tax Deductions that would have been
required by Applicable Law absent such Assignment, then such increased Tax shall be borne by the party making such Assignment. 
  

	8.10.2	Value Added Tax 

 Notwithstanding anything contained in Section 8.10.1, this
Section 8.10.2 shall apply with respect to value added tax (“VAT”). All Payments are exclusive of VAT. If any VAT is chargeable in respect of any Payments and AstraZeneca is required to account to the relevant Tax Authority for
that VAT, Mereo shall pay an amount equal to the VAT at the applicable rate in respect of any such Payments following the receipt of a VAT invoice in the appropriate form issued by AstraZeneca in respect of those Payments. The Parties shall issue
invoices for all goods and services supplied under this Agreement consistent with VAT requirements, and to the extent any invoice is not initially issued in an appropriate form, shall cooperate and provide such information or assistance as may be
reasonably necessary to enable the issuance of such invoice consistent with VAT requirements. 
  

	8.11	Interest on Late Payments 

 If any payment due to either Party under this Agreement is
not paid when due, then such paying Party shall pay interest thereon (before and after any judgment) at an annual rate (but with interest accruing on a daily basis) equal to the greater of: (i) the United States prime rate of interest as
reported by Citibank, New York, New York, as of the date such payment was due and payable, plus [***], and (ii) the maximum applicable legal rate of interest, such interest to run from the date on which payment of such sum became due until
payment thereof in full. 
  

	8.12	Financial Records 

 Mereo shall and shall cause its Affiliates and its and their
Sublicensees to, keep complete and accurate financial books and records pertaining to the Commercialization of Products hereunder, including books and records of Invoiced Sales and Net Sales of Products, in sufficient detail to calculate and verify
all amounts payable hereunder. Mereo shall and shall cause its Affiliates and its and their Sublicensees to, retain such books and records until the later of (i) [***] years after the end of the period to which such books and records pertain,
(ii) the expiration of the applicable tax statute of limitations (or any extensions thereof) and (iii) for such period as may be required by Applicable Law. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 28 

	8.13	Audit 

 At the request of AstraZeneca, Mereo shall and shall cause its Affiliates and its
and their Sublicensees to, permit an independent auditor designated by AstraZeneca and reasonably acceptable to Mereo, at reasonable times and upon reasonable notice, no more than once per Calendar Year, to audit the books and records maintained
pursuant to Section 8.12 relating to the preceding [***] Calendar Years only, solely for the purposes of ensuring the accuracy of the reports and payments made hereunder. An audit shall not cover any time period previously audited. Except as
provided below, the cost of this audit shall be borne by AstraZeneca, unless the audit reveals, with respect to a period, an underpayment of amounts due hereunder of more than [***] from the reported amounts for such period, in which case Mereo
shall bear [***] costs of the audit. Unless disputed pursuant to Section 8.14 below, if such audit concludes that (i) additional amounts were owed by Mereo, Mereo shall pay the additional amounts or (ii) excess payments were made by
Mereo, AstraZeneca shall reimburse such excess payments, in either case ((i) or (ii)), within [***] days after the date on which such audit is completed by AstraZeneca. Mereo may require the auditor to sign a customary
non-disclosure agreement before providing access to its books and records. 
  

	8.14	Audit Dispute 

 In the event of a dispute with respect to any audit under
Section 8.13, AstraZeneca and Mereo shall work in good faith to resolve the disagreement. If the Parties are unable to reach a mutually acceptable resolution of any such dispute within [***] days, the dispute shall be submitted for resolution
to one (1) of the big four (4) public accounting firms, jointly selected by each Party’s certified public accountants or to such other Person as the Parties shall mutually agree (the “Auditor”). The decision of the
Auditor shall be final and the costs of such arbitration as well as the initial audit shall be borne between the Parties in such manner as the Auditor shall determine. Not later than [***] days after such decision and in accordance with such
decision, Mereo shall pay the additional amounts or AstraZeneca shall reimburse the excess payments, as applicable. 
  

	8.15	Adjustment of [***] Success Payments 

  

	8.15.1	In partial consideration of the rights granted by AstraZeneca to Mereo hereunder, in the event that after the date of this Agreement and before the [***], which has a [***] to the [***], the [***] by [***] to the [***]
of the [***] or [***] that [***] of the [***] in the [***] on the [***] for the [***] or [***]. 

  

	8.15.2	In partial consideration of the rights granted by AstraZeneca to Mereo hereunder, in the event that after the date of this Agreement and before the [***], which has a [***] to the [***], the [***] by an [***] to the
[***] of the [***] or [***] that [***] of the [***] in the [***] on the [***] for the [***] or [***]. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 29 

	9.	INTELLECTUAL PROPERTY 

  

	9.1	Ownership of Intellectual Property 

  

	9.1.1	Ownership of Inventions 

 Subject to Section 9.1.2, as between the Parties, each
Party shall own all right, title and interest in and to any and all Inventions that are conceived, discovered, developed or otherwise made by or on behalf of such Party or its Affiliates or its or their (sub)licensees (or Sublicensee(s)), as
applicable, under or in connection with this Agreement, whether or not patented or patentable and any and all Patents and other intellectual property rights with respect thereto. 

 

	9.1.2	United States Law 

 The determination of whether Inventions are conceived, discovered,
developed or otherwise made by a Party for the purpose of allocating proprietary rights (including Patent, copyright or other intellectual property rights) therein, shall, for purposes of this Agreement, be made in accordance with Applicable Law in
the United States as such law exists as of the Effective Date irrespective of where such conception, discovery, development or making occurs. The Parties shall jointly own any Inventions and intellectual property rights therein that are made,
conceived, reduced to practice, authored, or otherwise discovered jointly by the Parties or any of their employees, Affiliates, licensees, Sublicensees (where permitted), independent contractors, or agents, whether simultaneously or successively,
including any Patent on such jointly owned Invention. Each Party shall have the right to use and license jointly owned Inventions and all intellectual property rights therein for any and all purposes without the need to account to or seek permission
from the other Party (subject, in all cases, to any other applicable terms of this Agreement); provided, however, that for clarity, the foregoing shall not be construed as granting or conveying to either Party any license or other rights to the
other Party’s other intellectual property rights, unless otherwise expressly set forth in this Agreement. 
  

	9.1.3	Assignment Obligation 

 Each Party shall cause all Persons who perform activities for
such Party under this Agreement or who conceive, discover, develop or otherwise make any Inventions by or on behalf of either Party or its Affiliates or its or their (sub)licensees (or Sublicensees) under or in connection with this Agreement to be
under an obligation to assign (or, if such Party is unable to cause such Person to agree to such assignment obligation despite such Party’s using commercially reasonable efforts to negotiate such assignment obligation, then to grant an
exclusive license under) their rights in any Inventions resulting therefrom to such Party, except where Applicable Law requires otherwise and except in the case of governmental,
not-for-profit and public institutions that have standard policies against such an assignment (in which case, a suitable license or right to obtain such a license, shall
be obtained). 
  

	9.2	Maintenance and Prosecution of Patents 

  

	9.2.1	In General 

 As between the Parties Mereo shall through counsel of its choice, prepare,
file, prosecute, extend, apply for supplementary protection certificates relating thereto, and maintain the Option Patents, including any related interference, re-issuance,
re-examination and opposition proceedings with respect thereto, in the Territory, in each case, the cost and expense of which shall [***]. Prior to the Option Exercise Date,

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 30 

 
Mereo, as prosecuting Party shall periodically inform AstraZeneca of all material steps with regard to the preparation, filing, prosecution and maintenance of the Option Patents, in the
Territory, including by providing AstraZeneca with a copy of material communications to and from any patent authority in the Territory regarding such Patents and by providing AstraZeneca drafts of any material filings or responses to be made to such
patent authorities in the Territory sufficiently in advance of submitting such filings or responses so as to allow for a reasonable opportunity for AstraZeneca to review and comment thereon. Prior to the Option Exercise Date, Mereo shall consider in
good faith the requests and suggestions of AstraZeneca with respect to such drafts and with respect to strategies for filing and prosecuting such Patents in the Territory and [***]. If, as between the Parties, Mereo decides, prior to the Option
Exercise Date, not to prepare, file, prosecute or maintain an Option Patent in a country in the Territory, Mereo shall provide reasonable prior written notice to AstraZeneca of such intention, AstraZeneca shall thereupon have the right, in its sole
discretion, to assume the control and direction of the preparation, filing, prosecution and maintenance of such Option Patent [***], whereupon AstraZeneca shall be deemed the prosecuting Party and Mereo the
non-prosecuting Party with respect to such Patent for the purposes of Section 9.2.2. Notwithstanding the foregoing, if Mereo exercises the Option, AstraZeneca shall have no right to prepare, file,
prosecute, extend, apply for supplementary protection certificates relating thereto, and maintain the Option Patents from and including the Option Exercise Date. 
  

	9.2.2	Cooperation 

 The non-prosecuting Party (as set
forth in Section 9.2.1) shall, and shall cause its Affiliates to, assist and cooperate with the prosecuting Party (as set forth in Section 9.2.1), as the prosecuting Party may reasonably request from time to time, in the preparation,
filing, prosecution and maintenance of the Option Patents in the Territory under this Section 9.2, including that the non-prosecuting Party shall, and shall ensure that its Affiliates, (i) offer its
comments, if any, promptly, (ii) provide access to relevant documents and other evidence and make its employees available at reasonable business hours; provided, however, that neither Party shall be required to provide legally privileged
information with respect to such intellectual property unless and until procedures reasonably acceptable to such Party are in place to protect such privilege); and provided, further, that the prosecuting Party shall reimburse the non-prosecuting Party for its [***] costs and expenses incurred in connection therewith. 
  

	9.2.3	Patent Listings 

 As between the Parties, Mereo shall have the right in its good faith
determination to make all filings with Regulatory Authorities in the Territory with respect to the Option Patents, including as required or allowed (i) in the United States, in the FDA’s Orange Book and (ii) in the European Union,
under the national implementations of Section 10.1(a)(iii) of Directive 2001/EC/83 or other international equivalents. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 31 

	9.3	Enforcement of Patents 

  

	9.3.1	Notice 

 Each Party shall promptly notify the other Party in writing of (i) any
alleged or threatened infringement of the Option Patents in any jurisdiction in the Territory or (ii) any certification filed under the Hatch-Waxman Act claiming that any of the Option Patents are invalid or unenforceable or claiming that any
of the Option Patents would not be infringed by the making, use, offer for sale, sale or import of a product for which an application under the Hatch-Waxman Act is filed or any equivalent or similar certification or notice in any other jurisdiction,
in each case ((i) and (ii)) of which such Party becomes aware (an “Infringement”). 
  

	9.3.2	Enforcement of Patents 

 As between the Parties, Mereo shall have the first right, but
not the obligation, to prosecute any Infringement with respect to the Option Patents, including as a defense or counterclaim in connection with any Third Party Infringement Claim, [***], using counsel of Mereo’s choice. If, prior to the Option
Exercise Date, Mereo declines to prosecute any Infringement with respect to an Option Patent, AstraZeneca may prosecute such infringement [***]. For purposes of this Section 9.3.2, the Party prosecuting any Infringement pursuant to the
foregoing sentences with respect to a Patent shall be the “Enforcing Party.” In the event AstraZeneca prosecutes any such Infringement in the Field in the Territory, Mereo shall have the right to join as a party to such claim, suit
or proceeding and participate with its own counsel [***]; provided that AstraZeneca shall retain control of the prosecution of such claim, suit or proceeding, including the response to any defense or defense of any counterclaim raised in
connection therewith. In the event Mereo prosecutes any such Infringement in the Field in the Territory, AstraZeneca shall have the right to join as a party to such claim, suit or proceeding and participate with its own counsel [***]; provided that
Mereo shall retain control of the prosecution of such claim, suit or proceeding, including the response to any defense or defense of any counterclaim raised in connection therewith. If Mereo exercises the Option, AstraZeneca shall have no right to
prosecute any Infringement relating to the Option Patents from and including the relevant Option Exercise Date. 
  

	9.3.3	Cooperation 

 The Parties agree to cooperate fully in any Infringement action pursuant to
this Section 9.3.3, including by making the inventors, applicable records and documents (including laboratory notebooks) with respect to the relevant Patents available to the Enforcing Party on the Enforcing Party’s request. With respect
to an action controlled by the applicable Enforcing Party, the other Party shall, and shall cause its Affiliates to, assist and cooperate with the Enforcing Party, as the Enforcing Party may reasonably request from time to time, in connection with
its activities set forth in this Section 9.3.3, including where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and
other evidence and making its employees available at reasonable business hours; provided that the Enforcing Party shall reimburse such other Party for its [***] costs and expenses incurred in connection therewith. Unless otherwise set forth herein,
the Enforcing Party shall have the right to settle such claim; provided that neither Party shall have the right to settle any Infringement litigation under this Section 9.3.3 in a manner that has a material adverse

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 32 

 
effect on the rights or interest of the other Party or in a manner that imposes any costs or liability on or involves any admission by, the other Party, without the express written consent of
such other Party (which consent shall not be unreasonably withheld, conditioned or delayed). In connection with any activities with respect to an Infringement action prosecuted by the applicable Enforcing Party pursuant to this Section 9.3.3
involving Patents owned or Controlled by or licensed under Section 2 to the other Party, the Enforcing Party shall (i) consult with the other Party as to the strategy for the prosecution of such claim, suit or proceeding,
(ii) consider in good faith any comments from the other Party with respect thereto and (iii) keep the other Party reasonably informed of any material steps taken and provide copies of all material documents filed, in connection with such
action. 
  

	9.3.4	Recovery 

 Except as otherwise agreed by the Parties in connection with a cost sharing
arrangement, any recovery realized as a result of such litigation described above in this Section 9.3.4 (whether by way of settlement or otherwise) shall be first, allocated to reimburse the Parties for their costs and expenses in making such
recovery (which [***] if [***] to [***] the [***] of [***]). Any remainder after such reimbursement is made shall be [***]; provided, however, that to the extent that [***] or [***] (whether by [***] or [***]) with respect to an [***]
is [***] to [***] of [***] or [***] with respect to [***] such [***] or [***] shall be [***] and [***]. 
  

	9.4	Infringement Claims by Third Parties 

 If the Exploitation of a Product in the Territory
pursuant to this Agreement results in, or is reasonably expected to result in, any claim, suit or proceeding by a Third Party alleging infringement by Mereo or any of its Affiliates or its or their Sublicensees, (a “Third Party Infringement
Claim”), including any defense or counterclaim in connection with an Infringement action initiated pursuant to this Section 9.4, the Party first becoming aware of such alleged infringement shall promptly notify the other Party thereof
in writing. As between the Parties, Mereo shall be responsible for defending any such claim, suit or proceeding [***], using counsel of Mereo’s choice. Prior to the Option Exercise Date, AstraZeneca may participate in any such claim, suit or
proceeding with counsel of its choice [***]; provided that Mereo shall retain the right to control such claim, suit or proceeding. If Mereo exercises the Option, AstraZeneca shall have no right participate in any such claim, suit or proceeding
relating to the Option Patents from and including the Option Exercise Date. AstraZeneca shall, and shall cause its Affiliates to, assist and cooperate with Mereo, as Mereo may reasonably request from time to time, in connection with its activities
set forth in this Section 9.4, including where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence and
making its employees available at reasonable business hours; provided that Mereo shall reimburse AstraZeneca for [***] costs and expenses incurred in connection therewith. Mereo shall keep AstraZeneca reasonably informed of all material developments
in connection with any such claim, suit or proceeding. Mereo agrees to provide AstraZeneca with copies of all material pleadings filed in such action and to allow AstraZeneca reasonable opportunity to participate in the defense of the claims. Any

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 33 

 
damages, or awards, including royalties incurred or awarded in connection with any Third Party Infringement Claim defended under this Section 9.4 shall be [***]. For clarity, if Mereo is
required to make any payment to a Third Party to settle such Third Party Infringement Claim, such Third Party Payment shall be a Third Party Payment for the purposes of Section 8.5.3(c). 

 

	9.5	Invalidity or Unenforceability Defenses or Actions 

 Each Party shall promptly notify the
other Party in writing of any alleged or threatened assertion of invalidity or unenforceability of any of the Option Patents by a Third Party and of which such Party becomes aware. As between the Parties, Mereo shall have the first right, but not
the obligation, to defend and control the defense of the validity and enforceability of the Option Patents [***]. If, prior to the Option Exercise Date, Mereo declines to defend any such invalidity claim with respect to an Option Patent, AstraZeneca
may defend such invalidity claim [***]. For purposes of this Section 9.5, the Party defending any action pursuant to the foregoing sentence with respect to a Patent shall be the “Controlling Party.” If the Controlling Party or
its designee elects not to defend or control the defense of the applicable Patents in a suit brought in the Territory or otherwise fails to initiate and maintain the defense of any such claim, suit or proceeding, then subject to any rights of Third
Parties under any applicable Third Party agreements existing as of the Effective Date, the non-Controlling Party may conduct and control the defense of any such claim, suit or proceeding [***]. If Mereo
exercises the Option, AstraZeneca shall have no right to defend or control the defense of for the relevant Option Patents from and including the relevant Option Exercise Date. The non-Controlling Party in such
an action shall, and shall cause its Affiliates to, assist and cooperate with the Controlling Party, as such Controlling Party may reasonably request from time to time in connection with its activities set forth in this Section 9.5, including
where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence and making its employees available at reasonable
business hours; provided that the Controlling Party shall reimburse the non-Controlling Party for its [***] costs and expenses incurred in connection therewith. In connection with any activities with respect
to a defense, claim or counterclaim relating to the Option Patents pursuant to this Section 9.5, the Controlling Party shall (x) consult with the non-Controlling Party as to the strategy for such
activities, (y) consider in good faith any comments from the non-Controlling Party and (z) keep the non-Controlling Party reasonably informed of any material
steps taken and provide copies of all material documents filed, in connection with such defense, claim or counterclaim. 
  

	9.6	Third Party Patent Rights 

 If, at any time during the Term, [***], the Exploitation of
the Compounds or Product in the Field and in the Territory by Mereo, any of its Affiliates or any of its or their Sublicensees infringes or is reasonably expected to infringe any Patent of a Third Party in any country in the Territory (such right, a
“Third Party Patent Right”), then, as between the Parties, Mereo shall have the right, but not the obligation, to negotiate and obtain a license from such Third Party to such Third Party Patent Right as necessary or desirable for
Mereo or its Affiliates or its or their Sublicensees to Exploit the Compounds and Products in the Field in such country; provided that subject to [***]. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 34 

	10.	CONFIDENTIALITY AND NON-DISCLOSURE 

  

	10.1	Confidentiality Obligations 

 At all times during the Term and for a period of [***]
years following termination or expiration hereof in its entirety (except that Confidential Information consisting of trade secrets shall be subject to the terms and conditions of this Section 10 beyond such [***] year period until such
Confidential Information no longer constitutes a trade secret except where due to a breach by the receiving Party of this Agreement or other obligation of confidentiality owed to the disclosing Party), each Party shall and shall cause its officers,
directors, employees and agents to, keep confidential and not publish or otherwise disclose to a Third Party and not use, directly or indirectly, for any purpose, any Confidential Information furnished or otherwise made known to it, directly or
indirectly, by the other Party, except to the extent such disclosure or use is expressly permitted by the terms of this Agreement. “Confidential Information” means any technical, business or other information or data provided by or
on behalf of one Party to the other Party regardless of form including a formula, pattern, compilation, program, method, technique, process, inventory, chemical, physical material, chemical structure or activity, design, prototype, drawings,
samples, source code, business plan, business opportunity, customer or personnel list, or financial statement proprietary to a Party or its Affiliate, including information relating to the terms of this Agreement (subject to Section 10.4),
information relating to the Compound(s) or any Product(s) (including the Regulatory Documentation), any Development or Commercialization of the Compounds or any Product(s), any know-how with respect thereto
developed by or on behalf of the disclosing Party or its Affiliates or the scientific, regulatory or business affairs or other activities of either Party. Notwithstanding the foregoing, the terms of this Agreement shall be deemed to be the
Confidential Information of both Parties and both Parties shall be deemed to be the receiving Party and the disclosing Party with respect thereto. Notwithstanding the foregoing, the confidentiality and non-use
obligations under this Section 10.1 with respect to any Confidential Information shall not include any information or portion thereof that: 
  

	10.1.1	is or hereafter becomes part of the public domain by public use, publication, general knowledge or the like through no breach of this Agreement by the receiving Party; 

 

	10.1.2	can be demonstrated by documentation or other competent proof to have been known by or in the receiving Party’s possession prior to disclosure by the disclosing Party without any obligation of confidentiality with
respect to such information; 

  

	10.1.3	is subsequently received by the receiving Party from a Third Party who is not bound by any obligation of confidentiality with respect to such information and who otherwise has the right to make such disclosure;

  

	10.1.4	has been or is published by a Third Party or otherwise enters the public domain through no fault of the receiving Party in breach of this Agreement; or 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 35 

	10.1.5	can be demonstrated by documentation or other competent evidence to have been independently developed by or for the receiving Party without reference to the disclosing Party’s Confidential Information.

 Specific aspects or details of Confidential Information shall not be deemed to be within the public domain or in the
possession of the receiving Party merely because the Confidential Information is embraced by more general information in the public domain or in the possession of the receiving Party. Further, any combination of Confidential Information shall not be
considered in the public domain or in the possession of the receiving Party merely because individual elements of such Confidential Information are in the public domain or in the possession of the receiving Party unless the combination and its
principles are in the public domain or in the possession of the receiving Party. 
  

	10.2	Permitted Disclosures 

 Each Party may disclose Confidential Information to the extent
that such disclosure is: 
  

	10.2.1	made in response to a valid order of a court of competent jurisdiction or other supra-national, federal, national, regional, state, provincial and local governmental or regulatory body of competent jurisdiction or, if
in the reasonable opinion of the receiving Party’s legal counsel, such disclosure is otherwise required by law, including by reason of filing with securities regulators or rules of an applicable securities exchange; provided, however,
that the receiving Party shall first where practicable have given notice to the disclosing Party and given the disclosing Party a reasonable opportunity to quash such order or to obtain a protective order or confidential treatment requiring that the
Confidential Information and documents that are the subject of such order be held in confidence by such court or agency or, if disclosed, be used only for the purposes for which the order was issued; provided, further, that the
Confidential Information disclosed in response to such court or governmental order shall be limited to that information which is legally required to be disclosed in response to such court or governmental order; 

 

	10.2.2	made by or on behalf of the receiving Party to the Regulatory Authorities as required in connection with any filing, application or request for Regulatory Approval; provided, however, that reasonable
measures shall be taken to assure confidential treatment of such information to the extent practicable and consistent with Applicable Law; 

  

	10.2.3	made by or on behalf of the receiving Party to a patent authority as may be reasonably necessary or useful for purposes of obtaining or enforcing a Patent; provided, however, that reasonable measures shall
be taken to assure confidential treatment of such information, to the extent such protection is available; 

  

	10.2.4	made by or on behalf of Mereo or its Affiliate to an actual or potential Sublicensee; or 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 36 

	10.2.5	made by or on behalf of Mereo to (a) legal, financial and investment banking advisors and potential or actual sources of financing, investors or acquirers as may be necessary in connection with their evaluation of
such potential or actual investment or acquisition and counsel for the foregoing and (b) in connection with disclosure obligations that arise in connection with potential financing; provided, however, that such persons shall be subject
to obligations of confidentiality and non-use with respect to such Confidential Information that are customary in such circumstances. In addition, if legally required, a copy of this Agreement, the
Subscription Deed and Parent Company Guarantee may be filed by Mereo with the U.S. Securities and Exchange Commission (or relevant ex-U.S. counterpart). In that case, Mereo shall notify AstraZeneca and provide
AstraZeneca a reasonable period of time of no more than [***] to request Mereo to diligently seek confidential treatment for terms of this Agreement for which confidential treatment is reasonably available, and shall provide AstraZeneca reasonable
advance notice of the terms proposed for redactions and a reasonable opportunity to request that Mereo make additional redactions of financial or other information to the extent confidential treatment is reasonably available under the law.

  

	10.3	Use of Name 

 Except as expressly provided herein, neither Party shall mention or
otherwise use the name, logo or Trademark of the other Party or any of its Affiliates or any of its or their (sub)licensees (or Sublicensees) (or any abbreviation or adaptation thereof) in any publication, press release, marketing and promotional
material or other form of publicity without the prior written approval of such other Party in each instance. The restrictions imposed by this Section 10.3 shall not prohibit (i) either Party from making any disclosure identifying the other
Party to the extent required in connection with its exercise of its rights or obligations under this Agreement and (ii) either Party from making any disclosure identifying the other Party that is required by Applicable Law or the rules of a
stock exchange on which the securities of the disclosing Party are listed (or to which an application for listing has been submitted). 
  

	10.4	Public Announcements 

 The Parties have agreed to make an announcement in the form set
out in Schedule 10.4 on the date of execution of this Agreement. Subject to the foregoing and Section 10.2.5, the Parties have agreed that neither Party shall issue any public announcement, press release or other public disclosure regarding
this Agreement or its subject matter without the other Party’s prior written consent, except for any such disclosure that is, in the opinion of the disclosing Party’s counsel, required to be disclosed by the disclosing Party (or any of its
Affiliates) by Applicable Law or the rules of a stock exchange on which the securities of the disclosing Party (or any of its Affiliates) are listed or admitted to trading (or to which an application for listing or admission to trading has been
submitted). In the event a Party (or any of its Affiliates) is, in the opinion of its counsel, required by Applicable Law or the rules of a stock exchange on which its securities are listed or admitted to trading (or to which an application for
listing or admission to trading has been submitted) to make such a public disclosure, such Party (or its relevant Affiliate) shall submit the proposed disclosure in writing to the other Party as far in advance as reasonably practicable (and in no
event less than [***] prior to the anticipated date of disclosure or such shorter period as required to ensure compliance with Applicable Law) so as to provide a reasonable opportunity to comment thereon. Neither Party shall be required to seek the
permission of the other 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 37 

 
Party to repeat any information regarding the terms of this Agreement or any amendment hereto that has already been publicly disclosed by such Party or by the other Party, in accordance with this
Section 10.4; provided that such information remains accurate as of such time and provided the frequency and form of such disclosure are reasonable. 
  

	10.5	Publications 

 The Parties recognize the desirability of publishing and publicly
disclosing the results of and information regarding, activities under this Agreement. Accordingly, Mereo shall be free to publicly disclose the results of and information regarding, activities under this Agreement, subject to prior review by
AstraZeneca of any disclosure of AstraZeneca’s Confidential Information for issues of patentability and protection of such Confidential Information, in a manner consistent with Applicable Law and industry practices, as provided in this
Section 10.5. Accordingly, prior to publishing or disclosing any Confidential Information of AstraZeneca, Mereo shall provide AstraZeneca with drafts of proposed abstracts, manuscripts or summaries of presentations that cover such Confidential
Information. AstraZeneca shall respond promptly through its designated representative and in any event no later than [***] after receipt of such proposed publication or presentation or such shorter period as may be required by the publication or
presentation. Mereo agrees to allow a reasonable period (not to exceed [***]) to permit filings for patent protection and to otherwise address issues of Confidential Information or related competitive harm to the reasonable satisfaction of
AstraZeneca. In addition, Mereo shall give due regard to comments furnished by AstraZeneca. Notwithstanding the foregoing, Mereo shall be free to include scientific and clinical data relating solely to the Compounds in publications on Mereo’s
activities under this Agreement, and such scientific and clinical data relating solely to the Compounds will not be considered Confidential Information of AstraZeneca for such purpose. 

 

	10.6	Return of Confidential Information 

 Upon the effective date of the expiration or
termination of this Agreement for any reason, either Party may request in writing and the non-requesting Party shall, with respect to Confidential Information to which such
non-requesting Party does not retain rights under the surviving provisions of this Agreement, promptly destroy all copies of such Confidential Information in the possession or control of the non-requesting Party and confirm such destruction in writing to the requesting Party. Notwithstanding the foregoing, the non-requesting Party shall be permitted to retain such
Confidential Information (x) to the extent necessary or useful for purposes of performing any continuing obligations or exercising any ongoing rights hereunder and, in any event, a single copy of such Confidential Information for archival
purposes and (y) any computer records or files containing such Confidential Information that have been created solely by such non-requesting Party’s automatic archiving and back-up procedures, to the extent created and retained in a manner consistent with such non-requesting Party’s standard archiving and
back-up procedures, but not for any other uses or purposes. All Confidential Information shall continue to be subject to the terms of this Agreement for the period set forth in Section 10.1. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 38 

	10.7	Privileged Communications 

 In furtherance of this Agreement, it is expected that the
Parties may, from time to time, disclose to one another privileged communications with counsel, including opinions, memoranda, letters and other written, electronic and verbal communications. Such disclosures are made with the understanding that
they shall remain confidential in accordance with this Section 10, that they will not be deemed to waive any applicable attorney-client or attorney work product or other privilege and that they are made in connection with the shared community
of legal interests existing between AstraZeneca and Mereo, including the community of legal interests in avoiding infringement of any valid, enforceable patents of Third Parties and maintaining the validity of any patents owned or controlled by the
Parties. In the event of any litigation (or potential litigation) with a Third Party related to this Agreement or the subject matter hereof, the Parties shall, upon either Party’s request, enter into a reasonable and customary joint defense
agreement. In any event, each Party shall consult in a timely manner with the other Party before engaging in any conduct (e.g., producing information or documents) in connection with litigation or other proceedings that could conceivably
implicate privileges maintained by the other Party. Notwithstanding anything contained in this Section 10.7, nothing in this Agreement shall prejudice a Party’s ability to take discovery of the other Party in disputes between them relating
to the Agreement and no information otherwise admissible or discoverable by a Party shall become inadmissible or immune from discovery solely by this Section 10.7. 
  

	11.	REPRESENTATIONS AND WARRANTIES 

  

	11.1	Mutual Representations and Warranties 

 AstraZeneca and Mereo each represent and warrant
to the other, as of the Effective Date, and covenants, that: 
  

	11.1.1	it is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has all requisite power and authority, corporate or otherwise, to execute, deliver and
perform this Agreement; 

  

	11.1.2	the execution and delivery of this Agreement and the performance by it of the transactions contemplated hereby have been duly authorized by all necessary corporate action and do not violate: (i) such Party’s
charter documents, bylaws or other organizational documents; (ii) in any material respect, any agreement, instrument or contractual obligation to which such Party is bound; (iii) any requirement of any Applicable Law; or (iv) any
order, writ, judgment, injunction, decree, determination or award of any court or governmental agency presently in effect applicable to such Party; 

  

	11.1.3	this Agreement is a legal, valid and binding obligation of such Party enforceable against it in accordance with its terms and conditions, subject to the effects of bankruptcy, insolvency or other laws of general
application affecting the enforcement of creditor rights, judicial principles affecting the availability of specific performance and general principles of equity (whether enforceability is considered a proceeding at law or equity);

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 39 

	11.1.4	it is not under any obligation, contractual or otherwise, to any Person that conflicts with or is inconsistent in any material respect with the terms of this Agreement or that would impede the diligent and complete
fulfilment of its obligations hereunder; and 

  

	11.1.5	neither it nor any of its Affiliates has been debarred or is subject to debarment and neither it nor any of its Affiliates has used or will use in any capacity, in connection with the services to be performed under this
Agreement, any Person who has been debarred pursuant to Section 306 of the FFDCA or who is the subject of a conviction described in such section. It will inform the other Party in writing promptly if it or any such Person who is performing
services hereunder is debarred or is the subject of a conviction described in Section 306 or if any action, suit, claim, investigation or legal or administrative proceeding is pending or, to the best of its or its Affiliates’ Knowledge, is
threatened, relating to the debarment or conviction of it or any such Person performing services hereunder. 

  

	11.2	Additional Representations and Warranties of AstraZeneca 

 AstraZeneca further represents
and warrants to Mereo, as of the Effective Date, that: 
  

	11.2.1	to AstraZeneca’s Knowledge, other than the Option Intellectual Property, there are no intellectual property rights: (a) which are owned by AstraZeneca or any of its Affiliates as of the Effective Date or at
any time during the time of the Agreement and that (b) relate [***] to the Compounds or Products; 

  

	11.2.2	AstraZeneca owns the Option Know-How and, subject to any restrictions in the Transferring Contracts or Additional Studies, has the right to grant the licenses and sublicenses
specified thereunder without liens or other encumbrances; 

  

	11.2.3	AstraZeneca owns the Option Patents set forth in Schedule 1.79 and has the right to grant the licenses and sublicenses specified thereunder without liens or other encumbrances; 

 

	11.2.4	the list of Option Patents set forth in Schedule 1.79 is true, complete and accurate as of the Effective Date; 

  

	11.2.5	AstraZeneca has obtained all necessary consents, approvals and authorizations of all governmental Authorities and / or Regulatory Authorities and other Persons or entities required to be obtained by it in connection
with the execution and delivery of this Agreement; 

  

	11.2.6	AstraZeneca is in compliance with all Applicable Law to the extent relevant to the licenses granted hereunder and the Product Intellectual Property, including the Bayh-Dole Act; 

 

	11.2.7	AstraZeneca has not received any written claim or demand alleging that (a) the Option Patents are invalid or unenforceable or (b) the Development or Commercialization of the Products as contemplated herein
infringes any Patent owned by any Third Party; 

  

	11.2.8	to AstraZeneca’s Knowledge, there are no ongoing proceedings in court as to infringement, misappropriation or invalidity of any of the Option Patents, including any inter partes proceedings or oppositions;

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 40 

	11.2.9	to AstraZeneca’s Knowledge, no Person is infringing or threatening to infringe the Option Patents in the Field; and no facts exist that would render the Option Patents invalid or unenforceable; 

 

	11.2.10	the Option Patents have been prosecuted in accordance with all Applicable Law including the duty of candor; 

  

	11.2.11	AstraZeneca has received no regulatory warnings or complaint letters in connection with the Compounds or Products; 

  

	11.2.12	solely in relation to the services carried out in its conduct of the Transfer Activities: (i) none of its Third Party suppliers and no employees or contractors of AstraZeneca who has been involved in the
development of the Compounds and Products has, to AstraZeneca’s Knowledge, been debarred or is subject to debarment; and (ii) neither it nor any of its Affiliates has used, does use or will use in any capacity, in connection with the
services to be performed under this Agreement, any Person who has been debarred pursuant to Section 306 of the FFDCA or who is the subject of a conviction described in such section; 

 

	11.2.13	all API, Compounds, and the Products, as applicable, have been manufactured in compliance with all Applicable Law and applicable good manufacturing practice; 

 

	11.2.14	AstraZeneca has not had any and is not in material dispute with any Third Party supplier in connection with the supply of the Compounds, or Products; 

 

	11.2.15	AstraZeneca is not conducting, nor planning to conduct in the immediate future, any Development with a neutrophil elastase inhibitor, other than as contemplated by this Agreement; 

 

	11.2.16	With the exception of the Additional Studies and the Ongoing Research Agreements, to AstraZeneca’s Knowledge neither AstraZeneca nor its Affiliates is a party to an upstream agreement which relates to any of the
Product Intellectual Property; 

  

	11.2.17	to AstraZeneca’s Knowledge, the list of Transferring Contracts set forth in Schedule 1.129 is a true, complete and accurate list as of the Effective Date of all written or oral legally binding contracts,
agreements, instruments, commitments, obligations, understandings, or undertakings of any nature (including leases, licenses, mortgages, notes, guarantees, sublicenses, subcontracts, covenants not to compete, covenants not to sue, confidentiality
agreements, options and warranties) which are exclusively related to the Business; and 

  

	11.2.18	to AstraZeneca’s Knowledge, AstraZeneca is in compliance with the terms of all Transferring Contracts. 

  

	11.3	Additional Representation, Warranty and Covenant of AstraZeneca 

 AstraZeneca further
represents and warrants to Mereo on an ongoing basis that, subject to any restrictions contained in the Transferring Contracts or Additional Studies: 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 41 

	11.3.1	AstraZeneca will not grant any security, liens or other encumbrance over the Option Intellectual Property prior to the Option Exercise Date; and 

 

	11.3.2	AstraZeneca will not grant any security, liens or other encumbrance over the Option Intellectual Property on or following to the Option Exercise Date that would prevent AstraZeneca granting the licenses and sublicenses
specified hereunder. 

  

	11.4	DISCLAIMER OF WARRANTIES 

 EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH HEREIN, NEITHER
PARTY MAKES ANY REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE AND EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL OR EXPRESS OR IMPLIED,
INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF
THIRD PARTIES. 
  

	12.	ANTI-BRIBERY AND ANTI-CORRUPTION COMPLIANCE 

  

	12.1	Mereo agrees, on behalf of itself, its officers, directors and employees and on behalf of its Affiliates, agents, representatives, consultants and subcontractors hired in connection with the subject matter of this
Agreement (together with Mereo, the “Mereo Representatives”) that for the performance of its obligations hereunder: 

  

	12.1.1	the Mereo Representatives shall not directly or indirectly pay, offer or promise to pay or authorize the payment of any money or give, offer or promise to give or authorize the giving of anything else of value, to:
(a) any Government Official in order to improperly influence official action; (b) any Person (whether or not a Government Official) (i) to improperly influence such Person to act in breach of a duty of good faith, impartiality or
trust (“acting improperly”), (ii) to reward such Person for acting improperly or (iii) where such Person would be acting improperly by receiving the money or other thing of value; (c) any Person (whether or not a Government
Official) while knowing or having reason to know that all or any portion of the money or other thing of value will be paid, offered, promised or given to or will otherwise benefit, a Government Official in order to improperly influence official
action for or against either Party in connection with this Agreement; or (d) any Person (whether or not a Government Official) to reward that Person for acting improperly or to induce that Person to act improperly; and 

 

	12.1.2	the Mereo Representatives shall not, directly or indirectly, solicit, receive or agree to accept any payment of money or anything else of value in violation of the Anti-Corruption Laws. 

 

	12.2	Mereo shall and shall cause the Mereo Representatives to comply with (a) such applicable Anti-Corruption Laws; (b) their own internal policies relating to anti-corruption; and (c) in connection with
activities under this Agreement, AZ’s Global Ethical Interactions Policy. If AstraZeneca makes any material change to AZ’s Global Ethical Interactions Policy, it shall notify Mereo of such change in writing and Mereo and the Mereo
Representatives shall be under no obligation to comply with such change until such time as Mereo has received such notice of the same. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 42 

	12.3	Mereo, on behalf of itself and the other Mereo Representatives shall promptly inform AstraZeneca upon receipt by Mereo of a formal notification that it or any of the Mereo Representatives is the target of a formal
investigation by a Regulatory Authority for a Material Anti-Corruption Law Violation. 

  

	12.4	For the purpose of auditing and monitoring the performance of its compliance with this Section 12, Mereo will during the Term, subject to the terms of this Section 12.4 and not more than [***] in each Calendar
Year, permit any reasonably acceptable independent auditor appointed by AstraZeneca for such purpose and any Regulatory Authority to have access to any premises of Mereo or other Mereo Representatives used in connection with this Agreement (such
access to be at reasonable times and on reasonable notice), together with a right to access personnel and records that relate to this Agreement (“Compliance Audit”). To the extent that any Compliance Audit by AstraZeneca requires
access and review of any commercially or strategically sensitive information or agreements of Mereo or Mereo Representatives, such independent auditor shall only report back to AstraZeneca such information as is directly relevant to informing
AstraZeneca on Mereo’s compliance with the particular provisions of this Agreement or the agreement being audited. Mereo shall, and shall cause the Mereo Representatives to, provide all cooperation and assistance during normal working hours as
reasonably requested by its independent auditor for the purposes of a Compliance Audit. AstraZeneca shall cause any such auditor to enter into a confidentiality agreement substantially consistent with the applicable requirements of Section 10
hereof, and to cause the minimum amount of disruption to the business of Mereo and the Mereo Representatives and to comply with relevant building and security regulations. 

 

	12.5	The costs and fees of any Compliance Audit shall be paid by [***] and [***] of rendering assistance under this Section 12. 

  

	12.6	If AstraZeneca becomes aware that Mereo (or any other Mereo Representative) has or comes to reasonably believe that Mereo (or any other Mereo Representative) has (and provides written evidence of the same to Mereo)
committed a Material Anti-Corruption Law Violation, AstraZeneca shall have the right, in addition to any other rights or remedies under this Agreement or to which it may be entitled in law or equity, to terminate this Agreement immediately and in
its entirety upon written notice to Mereo if Mereo does not cure such Material Anti-Corruption Law Violation or demonstrate that such Material Anti-Corruption Law Violation did not occur within [***] days of learning of, or notice from AstraZeneca
alleging, such Material Anti-Corruption Law Violation. To cure such Material Anti-Corruption Law Violation, Mereo shall take such steps, additional measures, representations, warranties, undertakings and other provisions, in each case, as
AstraZeneca believes in good faith are reasonably necessary in order to avoid a subsequent Material Anti-Corruption Law Violation or continuing violation of Anti-Corruption Laws. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 43 

	12.7	Any termination of this Agreement pursuant to Section 12 shall be treated as a termination by AstraZeneca for Mereo’s breach and the applicable consequences of termination set forth in Section 15 shall
apply. 

  

	12.8	AstraZeneca may disclose the terms of this Agreement or any action taken under this Section 12 to prevent a potential violation or continuing violation of applicable Anti-Corruption Laws, including the identity of
Mereo or a Mereo Representative and the payment terms, to any Regulatory Authority if AstraZeneca determines, upon advice of counsel, that such disclosure is necessary. 

 

	12.9	Nothing in this Section 12 shall require Mereo or any Mereo Representative to breach any applicable laws or regulations. 

  

	13.	INDEMNITY 

  

	13.1	Indemnification of AstraZeneca 

 Mereo shall indemnify AstraZeneca, its Affiliates, its
or their (sub)licensees and its and their respective directors, officers, employees and agents and defend and save each of them harmless, from and against any and all losses, damages, liabilities, costs and expenses (including reasonable
attorneys’ fees and expenses) (collectively, “Losses”) in connection with: (a) the employment or termination of employment of or other obligations to any employee of Mereo whose contract of employment is claimed or is
deemed to transfer to AstraZeneca or its Affiliates (each an “AZ Transferee” for the purposes of this Section 13.1) pursuant to TUPE, provided that the relevant employee is dismissed within [***] days of the AZ Transferee becoming
aware of the claimed or deemed transfer; and (b) any and all suits, investigations, claims or demands of Third Parties (collectively, “Third Party Claims”) arising from or occurring as a result of: (i) the breach by Mereo
of this Agreement; (ii) the gross negligence or willful misconduct on the part of Mereo or its Affiliates or its or their Sublicensees or its or their distributors or contractors or its or their respective directors, officers, employees or
agents in performing its or their obligations under this Agreement; or (iii) the Exploitation by Mereo or any of its Affiliates or its or their Sublicensees or its or their distributors or contractors of any Product or the Compounds in or for
the Territory, except, in each case ((i), (ii) and (iii)), for those Losses for which AstraZeneca has an obligation to indemnify Mereo pursuant to Section 13.2 hereof, as to which Losses each Party shall indemnify the other to the extent of
their respective liability for the Losses. 
  

	13.2	Indemnification of Mereo 

 AstraZeneca shall indemnify Mereo, its Affiliates, its or
their (sub)licensees and its and their respective directors, officers, employees and agents and defend and save each of them harmless, from and against any and all Losses in connection with: (a) the employment or termination of employment of or
other obligations to any employee of AstraZeneca or its Affiliates whose contract of employment is claimed or is deemed to transfer to Mereo or its Affiliates (each a “Mereo Transferee” for the purposes of this Section 13.2) pursuant
to TUPE provided that the relevant employee is dismissed within [***] days of the Mereo Transferee becoming aware of the claimed or deemed transfer; and (b) any and all Third Party Claims arising from or occurring as a result

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 44 

 
of: (i) the breach by AstraZeneca of this Agreement; (ii) the gross negligence or willful misconduct on the part of AstraZeneca or its Affiliates or its or their Sublicensees or its or
their respective directors, officers, employees or agents in performing its obligations under this Agreement; and (iii) the Exploitation by AstraZeneca or any of its Affiliates or its or their sublicensees or its or their distributors or
contractors of any Product or the Compounds in or for the Territory prior to the Effective Date, except, in each case (i) through (iii), for those Losses for which Mereo has an obligation to indemnify AstraZeneca pursuant to Section 13.1
hereof, as to which Losses each Party shall indemnify the other to the extent of their respective liability for the Losses. 
  

	13.3	Indemnification Procedures 

  

	13.3.1	Notice of Claim 

 All indemnification claims in respect of a Party, its Affiliates or its
or their (sub)licensees or their respective directors, officers, employees and agents shall be made solely by such Party to this Agreement (the “Indemnified Party”). The Indemnified Party shall give the indemnifying Party prompt
written notice (an “Indemnification Claim Notice”) of any Losses or discovery of fact upon which such indemnified Party intends to base a request for indemnification under this Section 13, but in no event shall the indemnifying
Party be liable for any Losses that result from any delay in providing such notice. Each Indemnification Claim Notice must contain a description of the claim and the nature and amount of such Loss (to the extent that the nature and amount of such
Loss is known at such time). The Indemnified Party shall furnish promptly to the indemnifying Party copies of all papers and official documents received in respect of any Losses and Third Party Claims. 

 

	13.3.2	Control of Defense 

 The indemnifying Party shall have the right to assume the
defense of any Third Party Claim by giving written notice to the Indemnified Party within [***] days after the indemnifying Party’s receipt of an Indemnification Claim Notice; provided that the indemnifying Party expressly agrees to defend the
claim against the Indemnified Party with respect to such Third Party Claim. The assumption of the defense of a Third Party Claim by the indemnifying Party shall not be construed as an acknowledgment that the indemnifying Party is liable to indemnify
the Indemnified Party in respect of the Third Party Claim, nor shall it constitute a waiver by the indemnifying Party of any defenses it may assert against the Indemnified Party’s claim for indemnification. Upon assuming the defense of a Third
Party Claim, the indemnifying Party may appoint as lead counsel in the defense of the Third Party Claim any legal counsel selected by the indemnifying Party; provided that it obtains the prior written consent of the Indemnified Party (which consent
shall not be unreasonably withheld, conditioned or delayed). In the event the indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall immediately deliver to the indemnifying Party all original notices and documents
(including court papers) received by the Indemnified Party in connection with the Third Party Claim. Should the indemnifying Party assume the defense of a Third Party Claim, except as provided 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 45 

 
in Section 13.3.3, the indemnifying Party shall not be liable to the Indemnified Party for any legal expenses subsequently incurred by such Indemnified Party in connection with the analysis,
defense or settlement of the Third Party Claim unless specifically requested in writing by the indemnifying Party. In the event that it is ultimately determined that the indemnifying Party is not obligated to indemnify, defend or hold harmless the
Indemnified Party from and against the Third Party Claim, the Indemnified Party shall reimburse the indemnifying Party for any and all [***] costs and expenses (including attorneys’ fees and costs of suit) and any Losses incurred by the
indemnifying Party in accordance with this Section 13 in its defense of the Third Party Claim. 
  

	13.3.3	Right to Participate in Defense 

 Any Indemnified Party shall be entitled to
participate in the defense of such Third Party Claim and to employ counsel of its choice for such purpose; provided, however, that such employment shall be at the Indemnified Party’s sole cost and expense unless (i) the employment
thereof has been specifically authorized in writing by the indemnifying Party in writing (in which case, the defense shall be controlled as provided in Section 13.3.2), (ii) the indemnifying Party has failed to assume the defense and employ
counsel in accordance with Section 13.3.2 (in which case the Indemnified Party shall control the defense) or (iii) the interests of the indemnitee and the indemnifying Party with respect to such Third Party Claim are sufficiently adverse
to prohibit the representation by the same counsel of both Parties under Applicable Law, ethical rules or equitable principles (in which case, the Indemnified Party shall control its defense). 

 

	13.3.4	Settlement 

 With respect to any Losses relating solely to the payment of money damages
in connection with a Third Party Claim and that shall not result in the applicable indemnitee(s) becoming subject to injunctive or other relief or otherwise adversely affecting the business of the Indemnified Party in any manner and as to which the
indemnifying Party shall have acknowledged in writing the obligation to indemnify the applicable indemnitee hereunder, the indemnifying Party shall have the sole right to consent to the entry of any judgment, enter into any settlement or otherwise
dispose of such Loss, on such terms as the indemnifying Party, in its sole discretion, shall deem appropriate. With respect to all other Losses in connection with Third Party Claims, where the indemnifying Party has assumed the defense of the Third
Party Claim in accordance with Section 13.3.2, the indemnifying Party shall have authority to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss; provided it obtains the prior written
consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned or delayed). If the indemnifying Party does not assume and conduct the defense of a Third Party Claim as provided above, the Indemnified Party may defend
against such Third Party Claim; provided that the Indemnified Party shall not settle any Third Party Claim without the prior written consent of the indemnifying Party (which consent shall not be unreasonably withheld, conditioned or
delayed). 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 46 

	13.3.5	Cooperation 

 Regardless of whether the indemnifying Party chooses to defend or prosecute
any Third Party Claim, the Indemnified Party shall and shall cause each indemnitee to, cooperate in the defense or prosecution thereof and shall furnish such records, information and testimony, provide such witnesses and attend such conferences,
discovery proceedings, hearings, trials and appeals as may be reasonably requested in connection therewith. Such cooperation shall include access during normal business hours afforded to the indemnifying Party to and reasonable retention by the
Indemnified Party of, records and information that are reasonably relevant to such Third Party Claim and making Indemnified Parties and other employees and agents available on a mutually convenient basis to provide additional information and
explanation of any material provided hereunder and the indemnifying Party shall reimburse the Indemnified Party for all its, its Affiliates’ and its and their (sub)licensees’ or their respective directors’, officers’,
employees’ and agents’, as applicable, reasonable and verifiable out-of-pocket expenses in connection therewith. 

 

	13.3.6	Expenses 

 Except as provided above, [***] and [***] of [***] the [***] and [***] and
[***] and [***] and [***], as applicable, [***] on a [***] by the [***], without prejudice to the [***] to [***] the [***] to [***] and [***] to [***] in the event [***] is [***] to be [***] to [***] the [***]. 

 

	13.4	Special, Indirect and Other Losses 

 EXCEPT (i) IN THE EVENT THE GROSS NEGLIGENCE,
WILLFUL MISCONDUCT OR FRAUD OF A PARTY OR IT’S AFFILIATES OR OF A PARTY’S BREACH OF ITS OBLIGATIONS UNDER SECTION 10, (ii) AS PROVIDED UNDER SECTION 16.11, (iii) TO THE EXTENT ANY SUCH DAMAGES ARE REQUIRED TO BE PAID TO A THIRD PARTY AS
PART OF A CLAIM FOR WHICH A PARTY PROVIDES INDEMNIFICATION UNDER THIS SECTION 13, NEITHER PARTY NOR ANY OF ITS AFFILIATES OR (SUB)LICENSEES SHALL BE LIABLE IN CONTRACT, TORT, NEGLIGENCE, BREACH OF STATUTORY DUTY OR OTHERWISE FOR ANY SPECIAL,
PUNITIVE, INCIDENTAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS OR REVENUES) OR FOR LOSS OF PROFITS OR REVENUES SUFFERED BY THE OTHER PARTY, REGARDLESS OF WHETHER ARISING FROM BREACH OF CONTRACT, WARRANTY, TORT ,STRICT LIABILITY OR
OTHERWISE, EVEN IF SUCH PARTY IS ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE OR IF SUCH LOSS OR DAMAGE COULD HAVE BEEN REASONABLY FORESEEN. 
  

	13.5	Insurance 

 Mereo shall have and maintain such types and amounts of insurance covering
its Exploitation of the Compounds and Products as is (i) normal and customary in the pharmaceutical industry generally for parties similarly situated and (ii) otherwise required by Applicable Law. Upon request by AstraZeneca, Mereo shall
provide to AstraZeneca evidence of its insurance coverage, including copies of applicable insurance policies. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 47 

	14.	TERM AND TERMINATION 

  

	14.1	Term and Expiration 

 This Agreement shall commence on the Effective Date and, unless
earlier terminated in accordance herewith, shall continue in force and effect until the date of expiration of the last Royalty Term for the last Product (such period, the “Term”). Following the expiration of the Royalty Term for a
Product in a country, the grants in Section 2.1 shall become fully-paid, royalty-free, and irrevocable for such Product in such country. For clarity, upon the expiration of the Term, the grants in Section 2.1 shall become fully-paid,
royalty-free, and irrevocable in their entirety. 
  

	14.2	Termination 

  

	14.2.1	Termination for Material Breach  

 In the event that either Party (the
“Breaching Party”) shall be in material breach in the performance of any of its obligations under this Agreement prior to or after the Option Exercise Date, in addition to any other right and remedy the other Party (the “Non-Breaching Party”) may have, the Non-Breaching Party may terminate this Agreement in its entirety by providing sixty (60) days (the “Notice
Period”) prior written notice (the “Termination Notice”) to the Breaching Party and specifying the breach and provided such termination shall not become effective at the end of the Notice Period if the Breaching Party cures
the breach specified in the Termination Notice during the Notice Period (or, if such default cannot be cured within the Notice Period, if the Breaching Party commences actions to cure such breach within the Notice Period and thereafter diligently
continues such actions). For the purposes of this Section 14.2.1, Mereo shall be deemed to be in material breach of the performance of its obligations under this Agreement if MBGP is in material breach of the performance of any of its
obligations under the Subscription Deed. 
  

	14.2.2	Termination by Mereo 

 Prior to the Option Exercise Date, Mereo shall have the
right to terminate this Agreement in its entirety, without cause, upon sixty (60) days’ prior written notice, such termination to be effective at the end of such notice period. 

 

	14.2.3	Termination for Insolvency 

 In the event that either Party (or, in the case of Mereo,
MBGP or any other person who controls (as defined in Section 1.4) Mereo: (i) files for protection under bankruptcy or insolvency laws, (ii) makes an assignment for the benefit of creditors, (iii) appoints or suffers appointment
of an administrator, liquidator, receiver or trustee over it or substantially all of its property that is not discharged within ninety (90) days after such filing, (iv) proposes a written agreement of composition or extension of its debts,
(v) proposes or is a party to any dissolution or liquidation, (vi) files a petition under any bankruptcy or insolvency act or has any such petition filed against that is not discharged within sixty (60) days of the filing thereof or
(vii) admits in writing its inability generally to meet its obligations as they fall due in the general course, then the other Party may terminate this Agreement in its entirety effective immediately upon written notice to such Party. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 48 

	14.3	Rights in Bankruptcy 

 All rights and licenses granted under or pursuant to this
Agreement by Mereo or AstraZeneca are and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction, licenses of right to “intellectual
property” as defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that the Parties, as licensees of such rights under this Agreement, shall retain and may fully exercise all of their rights and elections under the U.S.
Bankruptcy Code or any analogous provisions in any other country or jurisdiction. The Parties further agree that, in the event of the commencement of a bankruptcy proceeding by or against either Party under the U.S. Bankruptcy Code or any analogous
provisions in any other country or jurisdiction, the Party hereto that is not a Party to such proceeding shall be entitled to a complete duplicate of (or complete access to, as appropriate) any such intellectual property and all embodiments of such
intellectual property, which, if not already in the non-subject Party’s possession, shall be promptly delivered to it (i) upon any such commencement of a bankruptcy proceeding upon the non-subject Party’s written request therefor, unless the Party subject to such proceeding elects to continue to perform all of its obligations under this Agreement or (ii) if not delivered under clause
(i) above, following the rejection of this Agreement by or on behalf of the Party subject to such proceeding upon written request therefor by the non-subject Party. 

 

	15.	Consequences of Termination of this Agreement in its entirety 

  

	15.1.1	In the event of a termination of this Agreement in its entirety for any reason: 

  

	 	(a)	the grants in Section 2.1 shall become fully-paid, royalty-free, and irrevocable for such Product in their entirety provided however that if AstraZeneca terminates pursuant to Section 14.2.1
(Termination for Material Breach) or 14.2.3 (Termination for Insolvency) or where Mereo terminates pursuant to Section 14.2.2 (Termination by Mereo), then all rights and licenses granted by AstraZeneca hereunder
shall immediately terminate, including, for clarity, any sublicense granted by Mereo pursuant to Section 2.2; and 

  

	 	(b)	subject to Section 15.1.1(a), nothing in the Agreement will be construed to release either Party from any obligation that matured before the effective date of termination. 

 

	15.1.2	In addition to the provisions of Section 15.1.1, on a termination of this Agreement in its entirety by Mereo pursuant to Section 14.2.2 (Termination by Mereo) or by AstraZeneca pursuant to
Section 14.2.1 (Termination for Material Breach) or 14.2.3 (Termination for Insolvency): 

  

	 	(a)	 Mereo shall and hereby does, and shall cause its Affiliates and its and their Sublicensees to, when and as
requested by AstraZeneca, assign to AstraZeneca [***] of its right, title and interest in and to (a) all Regulatory Documentation (including any Regulatory Approvals) applicable to any Compound(s) or

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 49 

	 	
Product(s) then owned or Controlled by Mereo or any of its Affiliates; provided that if any such Regulatory Documentation or Regulatory Approval is not immediately transferable in a country,
Mereo shall provide AstraZeneca with [***] benefit of such Regulatory Documentation or Regulatory Approval, as applicable, and such assistance and cooperation as necessary or reasonably requested by AstraZeneca to timely transfer such Regulatory
Documentation or Regulatory Approval, as applicable, to AstraZeneca or its designee [***]; 

  

	 	(b)	unless expressly prohibited by any Regulatory Authority, at AstraZeneca’s written request, Mereo shall and hereby does, and shall cause its Affiliates to, (a) transfer control to AstraZeneca of [***] clinical
studies involving Products thereto being conducted by or on behalf of Mereo, an Affiliate as of the effective date of termination and (b) continue to conduct such clinical studies, [***], for up to [***] days to enable such transfer to be
completed without interruption of any such clinical study; provided that AstraZeneca shall not have any obligation to continue any clinical study unless required by Applicable Law; 

 

	 	(c)	at AstraZeneca’s written request, Mereo shall, and cause its Affiliates to, assign to AstraZeneca all Product Agreements, unless, with respect to any such Product Agreement, such Product Agreement expressly
prohibits such assignment, in which case Mereo (or such Affiliate) shall cooperate with AstraZeneca in all reasonable respects to secure the consent of the applicable Third Party to such assignment and if any such consent cannot be obtained with
respect to a Product Agreement, Mereo shall, and cause its Affiliates to, obtain for AstraZeneca [***] of the practical benefit and burden under such Product Agreement, including by (a) [***] and (b) [***]; and 

 

	 	(d)	at AstraZeneca’s written request, Mereo shall supply to AstraZeneca such quantities of the Compound(s) and Product(s) as [***] from time to time [***] to Manufacture such Compound(s) and Product(s) until the
earlier of (a) such time as AstraZeneca has established an alternate, validated source of supply for the Compound(s) and Product(s) and AstraZeneca is receiving supply from such alternative source and (b) the [***] of the effective date of
termination of this Agreement. 

  

	15.1.3	In addition to the provisions of Sections 15.1.1 and 15.1.2: 

  

	 	(a)	if Mereo exercises its right to terminate this Agreement in its entirety pursuant Section 14.2.1 (Termination for Material Breach) or 14.2.3 (Termination for Insolvency):AstraZeneca shall have the
[***] option for a period of [***] days after such termination to negotiate for an exclusive license for all Confidential Information and Patents Controlled by Mereo and its Affiliates claiming Inventions developed under the Agreement by Mereo and
its Affiliates claiming the composition or methods of use or Manufacture of Compounds or Products; and 

  

	 	(b)	if Mereo exercises its right to terminate this Agreement in its entirety pursuant to Section 14.2.2 (Termination by Mereo), or AstraZeneca exercises its right to terminate this Agreement in its entirety
pursuant to Section 14.2.1 (Termination for Material Breach) or 14.2.3 (Termination for Insolvency): 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 50 

	 	(i)	Mereo shall and hereby does, and shall cause its Affiliates to, grant to AstraZeneca solely for the Exploitation in the Territory in the Field of any Compound(s) or Product(s): 

 

	 	(A)	[***] royalty-free license with the right to grant multiple tiers of sublicenses, in and to all Confidential Information of Mereo and its Affiliates [***] to the Compound(s) or any Product(s); and 

 

	 	(B)	[***] license with the right to grant multiple tiers of sublicenses, in and to all Confidential Information of Mereo and its Affiliates [***] of any Compound(s) or any Product(s). In the interest of clarity, the non-exclusive license would only to Exploit Compounds or Product(s); and 

  

	 	(ii)	Mereo shall and hereby does, and shall cause its Affiliates to, effective as of the effective date of termination, grant AstraZeneca solely for the Exploitation in the Territory of any Compound(s) or Product(s) in the
Field: 

  

	 	(A)	[***], royalty-free license, with the right to grant multiple tiers of sublicenses, in and to all: 

  

	 	(I)	Patents Controlled by Mereo or its Affiliates claiming Inventions [***] to the [***] of Compounds or Products; and 

  

	 	(II)	Know-How Controlled by Mereo or its Affiliates [***] to the [***] of Compounds or Products; and 

 

	 	(B)	[***] license, with the right to grant multiple tiers of sublicenses, in and to all: 

  

	 	(I)	Patents Controlled by Mereo or its Affiliates claiming Inventions [***] Compounds or Products by Mereo or its Affiliates; and 

  

	 	(II)	Know-How Controlled by Mereo or its Affiliates [***] Compounds or Products by Mereo or its Affiliates; and 

 

	 	(C)	[***], royalty-free license, with the right to grant multiple tiers of sublicenses, in and to all, together with a right of reference, Regulatory Documentation (including any Regulatory Approvals) then Controlled by
Mereo or any of its Affiliates. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 51 

	15.2	Remedies 

 Except as otherwise expressly provided herein, termination of this Agreement
in accordance with the provisions hereof shall not limit any remedies that may otherwise be available in law or equity and shall be without prejudice to the rights of either Party against the other then accruing or accrued under this Agreement. For
clarity, on any expiry or termination of this Agreement on or after the Option Exercise Date, each Party shall retain all rights that may otherwise be available in law or equity to pursue any remedy available to such Party for the material breach of
the other Party. 
  

	15.3	Accrued Rights; Surviving Obligations 

 Termination or expiration of this Agreement for
any reason shall be without prejudice to any rights that shall have accrued to the benefit of a Party prior to such termination or expiration. Such termination or expiration shall not relieve a Party from obligations that are expressly indicated to
survive the termination or expiration of this Agreement. Without limiting the foregoing, (a) Sections 1, 2.5, 2.6, 3.4, 5.3, 7.3, 8.10, 8.12, 8.13, 8.14, 9.1, 10, 13.1 to 13.4, 14.1, 15, 16.5 to 16.8 and 16.9 to 16.18 of this Agreement shall
survive the termination or expiration of this Agreement for any reason and (b) the grants in Section 2.1 shall survive the expiration of the Term in accordance with Section 14.1. 

 

	16.	MISCELLANEOUS 

  

	16.1	Force Majeure 

 Neither Party shall be held liable or responsible to the other Party or
be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or performing any term of this Agreement (other than an obligation to make payments) when such failure or delay is caused by or results from events
beyond the reasonable control of the non-performing Party, including fires, floods, earthquakes, hurricanes, embargoes, shortages, epidemics, quarantines, war, acts of war (whether war be declared or not),
terrorist acts, insurrections, riots, civil commotion, strikes, lockouts or other labor disturbances (other than a labor disturbance involving the workforce of the non-performing Party where such event is
within the reasonable control of the non-performing Party), acts of God or acts, omissions or delays in acting by any governmental authority (except to the extent such delay results from the breach by the non-performing Party or any of its Affiliates of any term or condition of this Agreement). The non-performing Party shall notify the other Party of such force majeure within
[***] days after such occurrence by giving written notice to the other Party stating the nature of the event, its anticipated duration and any action being taken to avoid or minimize its effect. The suspension of performance shall be of no greater
scope and no longer duration than is necessary and the non-performing Party shall use commercially reasonable efforts to remedy its inability to perform. 

 

	16.2	Export Control 

 This Agreement is made subject to any restrictions concerning the export
of products or technical information from the United States or other countries that may be imposed on the Parties from time to time. Each Party agrees that it will not export, directly or indirectly, any technical information acquired from the other
Party under this Agreement or any products using such technical information to a location or in a manner that at the time of export requires an export license or other governmental approval, without first obtaining the written consent to do so from
the appropriate agency or other governmental entity in accordance with Applicable Law. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 52 

	16.3	Assignment 

  

	16.3.1	Neither Party may assign its rights or delegate its obligations under this Agreement, whether by operation of law or otherwise, in whole or in part without the prior written consent of the other Party, which consent
shall not be unreasonably withheld, conditioned or delayed, except that each Party shall have the right, without such consent, (i) to perform any or all of its obligations and exercise any or all of its rights under this Agreement through any
of its Affiliates or its or their (sub)licensees, and (ii) assign any or all of its rights and delegate any or all of its obligations hereunder to any of its Affiliates or its or their (sub)licensees or to any successor in interest (whether by
merger, acquisition, asset purchase or otherwise) to all or substantially all of the business to which this Agreement relates; provided that such assigning Party shall provide written notice to the other Party within [***] days after such assignment
or delegation, [***]. 

  

	16.3.2	In the event that Mereo assigns (or otherwise transfers) the Option Intellectual Property to any Third Party (following Mereo’s exercise of the Option), Mereo shall assign its rights and obligations under this
Agreement to the assignee of the Option Intellectual Property such that the assignee shall be bound by such obligations in place of Mereo, provided that [***] to [***] under Section [***] in the event: (i) such assignment or transfer [***]; and
(ii) [***]. Mereo shall provide written notice to AstraZeneca within [***] days after any such assignment. 

  

	16.3.3	Any successor of a Party or any assignee of all of a Party’s rights under this Agreement pursuant to this Section 16.3 that has also assumed all of such Party’s obligations hereunder in writing shall,
upon any such succession or assignment and assumption, be deemed to be a party to this Agreement as though named herein in substitution for the assigning Party, whereupon the assigning Party shall cease to be a party to this Agreement and shall
cease to have any rights or obligations under this Agreement. All validly assigned rights of a Party shall inure to the benefit of and be enforceable by, and all validly delegated obligations of such Party shall be binding on and be enforceable
against, the successors and assigns of such Party pursuant to this Section 16.3; provided that such Party, if it survives, shall remain jointly and severally liable for the performance of such delegated obligations under this Agreement.

  

	16.3.4	In the event that Mereo wishes to assign (or otherwise transfer) part, but not all, of the Option Intellectual Property to any Third Party (following Mereo’s exercise of the Option) (i) the Parties shall in
good faith agree any amendments to this Agreement that may be necessary to reflect such partial assignment and (ii) following such amendment, Mereo shall assign such Option Intellectual Property together with applicable rights and obligations
under this Agreement to the assignee of the Option Intellectual Property such that the assignee shall be bound by such obligations. 

  

	16.3.5	 Any attempted assignment or delegation in violation of this Section 16.3 shall be void and of no effect.

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 53 

	16.4	Subcontracting 

 Subject to Section 2.2, Mereo may subcontract with a Third Party to
perform any or all of its obligations hereunder (including by appointing one or more distributors). Mereo shall remain at all times responsible for the performance of its subcontractors and the appointment of a subcontractor shall not relieve Mereo
of its obligations under this Agreement, except to the extent they are satisfactorily performed by such subcontractor. 
  

	16.5	Severability 

 If any provision of this Agreement is held to be illegal, invalid or
unenforceable under any present or future law and if the rights or obligations of either Party under this Agreement will not be materially and adversely affected thereby, (i) such provision shall be fully severable, (ii) this Agreement
shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (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 here from and (iv) in lieu of such illegal, invalid or unenforceable provision, there shall be added automatically as a part of this Agreement a legal, valid and enforceable
provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and reasonably acceptable to the Parties. To the fullest extent permitted by Applicable Law, each Party hereby waives any provision of law that
would render any provision hereof illegal, invalid or unenforceable in any respect. 
  

	16.6	Dispute Resolution 

  

	16.6.1	If a dispute arises between the Parties in connection with or relating to this (a) Agreement or (b) any document or instrument delivered in connection herewith (collectively, (a) and (b), a
“Dispute”), then either Party shall have the right to refer such Dispute to the Senior Officers for attempted resolution by good faith negotiations during a period of [***]. Any final decision mutually agreed to by the Senior
Officers shall be conclusive and binding on the Parties. For purposes of referrals under this Section 16.6.1, it will be sufficient for a Party to send notice (a “Notice of Arbitration”) of the Dispute to the Senior Officers of the
other Party, and no meeting among the Senior Officers shall be required. 

  

	16.6.2	 Any Dispute not resolved by the Senior Officers within such [***] period, shall be determined by arbitration
administered by the [***] in accordance with its International Arbitration Rules. The number of arbitrators (each, an “Arbitrator”) shall be three (3). Each of the Arbitrators must have experience with disputes related to the
pharmaceutical industry. Within [***] days after the filing of the Notice of Arbitration, each of Mereo and AstraZeneca shall simultaneously appoint one (1) Arbitrator. Within [***] days after the appointment of the two party-appointed
Arbitrators, the two party-appointed Arbitrators shall appoint the third Arbitrator, who shall serve as the chair of the tribunal. Any Arbitrator not appointed within these time limits shall be appointed by the [***]. The place of arbitration shall
be [***]. Judgment may be entered upon any award in [***] (to the jurisdiction of which the Parties irrevocably and unconditionally submit for themselves and their property, and waive any jurisdictional objection or challenge to such courts,
including without limitation the defense of inconvenient forum), or any other court of competent 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 54 

	 	
jurisdiction. The parties undertake to keep confidential all awards in their arbitration, together with all materials in the proceedings created for the purpose of the arbitration and all other
documents produced by another party in the proceedings not otherwise in the public domain, save and to the extent that disclosure may be required of a party by legal duty, to protect or pursue a legal right or to enforce or challenge an award in
legal proceedings before a court or other judicial authority. The Arbitrators shall award to the prevailing party, if any, as determined by the Arbitrators, its reasonable attorneys’ fees and costs. Unless the Parties otherwise agree in
writing, during the period of time that any arbitration proceeding described in this Section 16.6.2 is pending under this Agreement, the Parties shall continue to comply with all those terms and provisions of this Agreement that are not the
subject of such pending arbitration proceeding. 

  

	16.7	Governing Law, Jurisdiction and Service 

  

	16.7.1	Governing Law 

 This Agreement shall be governed by and construed in accordance with the
Laws of the State of New York, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction. The Parties agree to exclude the
application to this Agreement of the United Nations Convention on Contracts for the International Sale of Goods. The Federal Arbitration Act shall govern the interpretation, enforcement, and proceedings pursuant to the arbitration clause in this
Agreement. 
  

	16.7.2	Service 

 Each Party further agrees that service of any process, summons, notice or
document by registered mail to its address set forth in Section 16.8.2 shall be effective service of process for any action, suit or proceeding brought against it under this Agreement in any such court. 

 

	16.8	Notices 

  

	16.8.1	Notice Requirements 

 Any notice, request, demand, waiver, consent, approval or other
communication permitted or required under this Agreement shall be in writing, shall refer specifically to this Agreement and shall be deemed given only if delivered by hand or sent by email transmission (with transmission confirmed) or by
internationally recognized overnight delivery service that maintains records of delivery, addressed to the Parties at their respective addresses specified in Section 16.8.2 or to such other address as the Party to whom notice is to be given may
have provided to the other Party in accordance with this Section 16.8.1. Such Notice shall be deemed to have been given as of the date delivered by hand or transmitted by email (with transmission confirmed) or on the second Business Day (at the
place of delivery) after deposit with an internationally recognized overnight delivery service. Any notice delivered by email shall be confirmed by a hard copy delivered as soon as practicable thereafter. This Section 16.8.1 is not intended to
govern the day-to-day business communications necessary between the Parties in performing their obligations under the terms of this Agreement. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 55 

	16.8.2	Address for Notice 

 If to Mereo, to: 

Mereo BioPharma 4 Limited 
 1
Cavendish Place 
 London W1G 0QF 

United Kingdom 
 Attention:
General Counsel 
 Email: [***] 

with copies (which shall not constitute notice) to: 

Mereo BioPharma Group plc 
 1
Cavendish Place 
 London W1G 0QF 

United Kingdom 
 Attention:
General Counsel 
 Email: [***] 

and 
 Latham & Watkins
LLP 
 140 Scott Drive 
 Menlo
Park, CA 94025 
 Attention: [***] 

Email: [***] 
 If to AstraZeneca,
to: 
 AstraZeneca UK Limited 

Macclesfield, Cheshire, SK10 2NA 

Attention: Deputy General Counsel, Corporate 

Email: [***] 
 with a copy (which
shall not constitute notice) to: 
 Bristows LLP 

100 Victoria Embankment, London, EC4Y 0DH, United Kingdom 

Attention: [***] 
 Email: [***]

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 56 

	16.9	Entire Agreement; Amendments 

 This Agreement, together with the Schedules attached
hereto, the Subscription Deed and the Parent Company Guarantee, sets forth and constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and all prior agreements, understandings, promises and
representations, whether written or oral, with respect thereto are superseded hereby. Each Party confirms that it is not relying on any representations or warranties of the other Party except as specifically set forth in this Agreement. No
amendment, modification, release or discharge shall be binding on the Parties unless in writing and duly executed by authorized representatives of both Parties. In the event of any inconsistencies between this Agreement and any schedules or other
attachments hereto, the terms of this Agreement shall control. 
  

	16.10	English Language 

 This Agreement shall be written and executed in and all other
communications under or in connection with this Agreement shall be in, the English language. Any translation into any other language shall not be an official version thereof and in the event of any conflict in interpretation between the English
version and such translation, the English version shall control. 
  

	16.11	Equitable Relief 

 Each Party acknowledges and agrees that the restrictions set forth in
Sections 10 and 11 are reasonable and necessary to protect the legitimate interests of the other Party and that such other Party would not have entered into this Agreement in the absence of such restrictions and that any breach or threatened breach
of any provision of such Sections may result in irreparable injury to such other Party for which there will be no adequate remedy at law. In the event of a breach or threatened breach of any provision of such Sections, the non- breaching Party shall be authorized and entitled to seek from any court of competent jurisdiction injunctive relief, whether preliminary or permanent, specific performance and an equitable accounting of all
earnings, profits and other benefits arising from such breach, which rights shall be cumulative and in addition to any other rights or remedies to which such non-breaching Party may be entitled in law or
equity. Both Parties agree to waive any requirement that the other (i) post a bond or other security as a condition for obtaining any such relief and (ii) show irreparable harm, balancing of harms, consideration of the public interest or
inadequacy of monetary damages as a remedy. Nothing in this Section 16.11 is intended or should be construed, to limit either Party’s right to equitable relief or any other remedy for a breach of any other provision of this Agreement. 

 

	16.12	Waiver and Non-Exclusion of Remedies 

 Any term
or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such
term or condition. The waiver by either Party hereto of any right hereunder or of the failure to perform or of a breach by the other Party shall not be deemed a waiver of any other right hereunder or of any other breach or failure by such other
Party whether of a similar nature or otherwise. The rights and remedies provided herein are cumulative and do not exclude any other right or remedy provided by Applicable Law or otherwise available except as expressly set forth herein. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 57 

	16.13	No Benefit to Third Parties 

 The covenants and agreements set forth in this Agreement
are for the sole benefit of the Parties hereto and their successors and permitted assigns and they shall not be construed as conferring any rights on any other Persons. 
  

	16.14	Further Assurance 

 Each Party shall duly execute and deliver or cause to be duly
executed and delivered, such further instruments and do and cause to be done such further acts and things, including the filing of such assignments, agreements, documents and instruments, as may be necessary or as the other Party may reasonably
request in connection with this Agreement or to carry out more effectively the provisions and purposes hereof or to better assure and confirm unto such other Party its rights and remedies under this Agreement. 

 

	16.15	Relationship of the Parties 

 It is expressly agreed that AstraZeneca, on the one hand
and Mereo, on the other hand, shall be independent contractors and that the relationship between the two Parties shall not constitute a partnership, joint venture or agency. Neither AstraZeneca, on the one hand, nor Mereo, on the other hand, shall
have the authority to make any statements, representations or commitments of any kind or to take any action, that will be binding on the other, without the prior written consent of the other Party to do so. All persons employed by a Party shall be
employees of such Party and not of the other Party and all costs and obligations incurred by reason of any such employment shall be for the account and expense of such first Party. 

 

	16.16	References 

 Unless otherwise specified, (1) references in this Agreement to any
Section or Schedule shall mean references to such Section or Schedule of this Agreement, (ii) references in any Section to any clause are references to such clause of such Section and (iii) references to any agreement, instrument or other
document in this Agreement refer to such agreement, instrument or other document as originally executed or, if subsequently amended, replaced or supplemented from time to time, as so amended, replaced or supplemented and in effect at the relevant
time of reference thereto. 
  

	16.17	Construction 

 Except where the context otherwise requires, wherever used, the singular
shall include the plural, the plural the singular, the use of any gender shall be applicable to all genders and the word “or” is used in the inclusive sense (and/or). Whenever this Agreement refers to a number of days, unless otherwise
specified, such number refers to calendar days. The captions of this Agreement are for convenience of reference only and in no way define, describe, extend or limit the scope or intent of this Agreement or the intent of any provision contained in
this Agreement. The term 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 58 

 
“including,” “include,” or “includes” as used herein shall mean including, without limiting the generality of any description preceding such term. The language of
this Agreement shall be deemed to be the language mutually chosen by the Parties and no rule of strict construction shall be applied against either Party hereto. 
  

	16.18	Counterparts 

 This Agreement may be executed in two (2) or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be executed by PDF format via email or other electronically transmitted signatures and such signatures shall be deemed
to bind each Party hereto as if they were original signatures. 
 [Signature Page Follows] 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 59 

 EXECUTION PAGE TO EXCLUSIVE LICENSE AND OPTION AGREEMENT 

IN WITNESS WHEREOF this Agreement is duly executed by the authorized representatives of the Parties as of the date first written above.

  

			
	ASTRAZENECA AB PUBL
		
	By:	 	 /s/ Jan-Olof Jacke

	Name:	 	
	Title:	 	President AstraZeneca AB

  

			
	MEREO BIOPHARMA 4 LIMITED
		
	By:	 	 /s/ Denise Scots-Knight

	Name:	 	
	Title:	 	Chief Executive Officer and Director

  
 60 

 SCHEDULE 1.3 

ADDITIONAL STUDIES 
  

	1.	DESCRIPTION OF ADDITIONAL STUDIES 

 [***] 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 61 

 SCHEDULE 1.25 

[***] 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 62 

 SCHEDULE 1.79 

OPTION PATENTS 
 [***] 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 63 

 SCHEDULE 10.4 

AGREED PRESS RELEASE 
 THE
INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE EU MARKET ABUSE REGULATION (596/2014). UPON THE PUBLICATION OF THE ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE,
THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN 
 Mereo BioPharma Group plc 

(“Mereo” or “Mereo BioPharma” or the “Company” or the “Group”) 

Mereo BioPharma announces agreement with AstraZeneca AB (“AstraZeneca”) 

for an exclusive license and option to acquire AZD9668 

Highlights 
  

	 	•	 	Potential novel oral therapy for the orphan disease alpha-1 antitrypsin deficiency  

  

	 	•	 	Substantive and supportive clinical data package available from studies in linked respiratory diseases; c.1,000 patients have been treated with the drug with positive data on safety, tolerance and efficacy

  

	 	•	 	Initial upfront consideration and planned Phase II study to be funded from the Company’s existing resources 

  

	 	•	 	AstraZeneca to become a shareholder in Mereo 

 London, XX October 2017 – Mereo
BioPharma Group plc (AIM: MPH), a clinical stage, UK-based, biopharmaceutical company focused on rare and specialty diseases, today announces that it has reached an agreement with AstraZeneca for an exclusive
license, including an option to acquire, AZD9668, an oral inhibitor of neutrophil elastase. Under the exclusive license the Company plans to conduct a Phase II study for the treatment of alpha-1 antitrypsin
deficiency (“AATD”), a congenital orphan condition. The Company has the right to exercise its option to acquire AZD9668 after the initiation of pivotal studies. 

Denise Scots-Knight, CEO of Mereo BioPharma Group plc commented: 

“We are delighted to have closed this agreement with AstraZeneca for AZD9668 in furtherance of our stated strategy of building a portfolio of products
focussed on rare and speciality diseases. We believe that this neutrophil elastase inhibitor has potential as an effective, orally available treatment for alpha-1 antitrypsin deficiency, an undertreated orphan
condition that results in progressive lung destruction. The structure of this license and option agreement allows us to complete the Phase II study with our existing resources before triggering additional payments to acquire the asset
outright.” 
 “AstraZeneca has generated a substantial clinical data package on AZD9668 which includes extensive Phase II studies in
several respiratory conditions that will inform the initial Phase II clinical study we are planning for AATD. We believe that the neutrophil elastase inhibitor AZD9668 could provide a new innovative approach for the treatment of AATD, which affects
approximately 100,000 patients in the US and 120,000 patients in Europe.” “As part of this agreement, we also welcome AstraZeneca as another large pharma shareholder in the Company, alongside Novartis.” 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 64 

 Kumar Srinivasan, Vice President of Scientific Partnering & Alliances at AstraZeneca added: 

“This transaction reaffirms AstraZeneca’s commitment to patients by re-positioning an asset into an orphan
indication with a high unmet need. We will continue to divest or out-license deprioritized assets where we believe it will help accelerate the development of new medicines.” 

Professor Sandy Sandhaus MD, PhD, FCCP said: “Alpha-1 antitrypsin deficiency is a debilitating disease with
limited treatment options. Available data to date suggests AZD9668 may be effective in treating this condition. I welcome Mereo’s clinical development programme that will evaluate its potential in this setting.” 

Robert A. (Sandy) Sandhaus, MD, PhD, FCCP is Professor of Medicine at National Jewish Health in Denver CO and a leading expert in the treatment of AATD. He is
also the Medical Director at AlphaNet, a patient advocacy organisation for patients with AATD, and Clinical Director of the Alpha-1 Foundation that promotes research and development of new therapies for the
treatment of AATD. 
 A conference call for analysts will be held today at 1pm GMT see below for details. 

Outline of deal terms 
 Mereo has acquired the license and
option to acquire AZD9668 for an initial upfront payment totalling US $5 million, in a combination of US $3 million in cash and the issue of • new ordinary shares in the capital of the Company (“New Ordinary Shares”) to
satisfy the balance of the upfront payment. The New Ordinary Shares are expected to be issued to AstraZeneca on or around • 2017. 
 Additional
deferred payments in cash and in new ordinary shares would be payable on certain milestones based on completion and success of the proof of concept study in AATD and upon the initiation of a potentially pivotal study in this indication. 

Additional global filing and approval milestones are payable following successful pivotal data. Under the agreement, following product launch, if approved,
the Company will pay AstraZeneca commercial milestones, sales-related payments and royalties, each in line with rates for analogous licensing deals for drugs at this stage of development. 

The cash element of the upfront payment for the option purchase and the initial Phase II study will be funded from the Company’s existing financial
resources. 
 Application will be made for the New Ordinary Shares to be admitted to trading on the AIM market operated by the London Stock Exchange and
admission is expected to become effective and dealings in the New Ordinary Shares on the London Stock Exchange are expected to commence on or around • 2017. The New Ordinary Shares, when issued, will rank pari passu with the existing
ordinary shares in the capital of the Company. 
 Following the issue of the New Ordinary Shares, the total number of shares in issue will be •
ordinary shares, each with voting rights. Therefore, the total number of voting rights in the Company with effect from such date will be •. This figure may be used from such date by shareholders in the Company as the denominator for the
calculations by which they will determine if they are required to notify their interest, or a change to their interest, in the Company under the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 65 

 About AATD 

AATD is a genetic disorder that affects approximately 100,000 patients in the United States and 120,000 patients in Europe
[rarediseases.org/rare-diseases/alpha-1-antitrypsin-deficiency]. It can cause severe debilitating conditions such as chronic liver disease but, most notably,
pulmonary emphysema, which is a life-threatening disease. Pulmonary emphysema results in irreversible destruction of the tissues supporting the function of the lungs and causing severe shortness of breath and wheeze. Patients typically present
between the ages of 20 and 50 and have both a significantly reduced quality of life and a reduced life expectancy. 
 The lung damage in AATD results from
loss of the normal protective effect of alpha-1 antitrypsin against the damaging enzymes released during inflammation, specifically neutrophil elastase. 

Current standard of care for AATD varies from country to country. Protein replacement therapy, involving weekly infusions of plasma-derived alpha 1
antitrypsin is approved but is only reimbursed in the United States and some European countries. By suppressing neutrophil elastase through a more easily administered oral treatment, Mereo believes AZD9668 has significant differentiation from the
current protein replacement therapy. 
 AstraZeneca has conducted a number of Phase I and Phase II clinical studies with AZD9668 in respiratory conditions
that share some common pathology with AATD, specifically chronic obstructive pulmonary disease (“COPD”), cystic fibrosis and bronchiectasis. Approximately 1,000 patients have been treated with the drug in clinical studies to date. These
studies have shown AZD9668 to be safe and well-tolerated. They have also generated signals of efficacy in lung function and biomarker data that are consistent with an elastase-mediated mechanism of action. 

Mereo intends to initiate a Phase II study in AATD in 2018. This Phase II study is expected to be a 12-week
randomized, placebo controlled, study that will evaluate two doses of AZD9668 in approximately 150 patients with the PiZZ and NULL genetic mutations. These mutations are seen in the more severely affected patients who have very low (PiZZ) or zero
(NULL) alpha-1 antitrypsin levels. Mereo expects to leverage the internal expertise and respiratory disease key opinion leader network that it has assembled for the development of acumapimod to develop
AZD9668. 
 Analyst conference call 
 A conference call
for analysts will be held today at 1pm GMT. To participate please dial: 
 United Kingdom: +44 3333000804 

United States: +1 6319131422 
 PIN: 33714203# 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 66 

 For Further Enquiries: 
  

			
	Mereo BioPharma Group plc	  	+44 (0)333 023 7319
	Denise Scots-Knight, Chief Executive Officer	  	
	Richard Jones, Chief Financial Officer	  	
		
	 Nominated Adviser and Joint Broker

Cantor Fitzgerald Europe
	  	+44 (0)20 7894 7000
	Phil Davies	  	
	Will Goode	  	
		
	 Joint Broker
 RBC Capital
Markets
	  	+44 (0)20 7653 4000
	Rupert Walford	  	
	Laura White	  	
		
	 Public Relations Adviser to Mereo BioPharma

FTI Consulting
	  	+44 (0)20 3727 1000
	Ben Atwell	  	
	Simon Conway	  	
	Brett Pollard	  	
		
	 US Public Relations Advisor to Mereo BioPharma

Burns McClellan
	  	+01 (0) 212 213 0006
	Lisa Burns	  	
	Steven Klass	  	

 About Mereo 
 Mereo
BioPharma is an innovative biopharma company established to address the R&D and financial challenges faced by an increasing number of large pharma and biotech companies. Mereo focuses on developing and optimizing the value of novel medicines
acquired from large pharma and biotech designed to address significant unmet medical needs in rare and specialty disease areas. 
 Mereo is comprised of a
strong team with broad operational capabilities and the financial resources to conduct comprehensive clinical studies. The Company plans to build a rare and orphan commercial business combined with plans to partner where appropriate. 

Mereo’s existing portfolio consists of three mid-late stage clinical assets that were acquired from Novartis in
July 2015 each with proof of concept data in the indication that Mereo is now developing. BPS-804 is being developed for the prevention of fractures resulting from osteogenesis imperfecta (brittle bone
disease); acumapimod (BCT-197), is being developed to treat inflammation in patients with an AECOPD; and BGS-649 is a once-weekly oral novel therapy that restores the
patient’s own testosterone in men with hypogonadotropic hypogonadism. 
 In H1 2016 the Company initiated a Phase 2 study with acumapimod and a Phase
2b study with BGS-649. Mereo recently announced commencement of the first potentially pivotal Phase 2b trial for BPS-804 and completion of enrolment of both the
acumapimod Phase 2 study and the BGS-649 Phase 2b study. The acquisition of AZD9668 is in furtherance of the Company’s objective to build a portfolio of additional rare and specialty products acquired
from large pharmaceutical and biotechnology companies. The Company continues to actively evaluate other opportunities with this product profile. 

  
 [***] Certain information
in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential Treatment has been requested with respect to the omitted portions. 

 
 67EX-10.23

 Exhibit 10.23 
  

 
 [EXECUTION VERSION] 

DATED 7 August 2017 
 (1) MEREO
BIOPHARMA GROUP PLC 
 (as Borrower) 

(2) THE GUARANTORS 
 (as
Guarantor) 
 (3) SILICON VALLEY BANK and KREOS CAPITAL V 

(UK) LIMITED 
 (as Lenders)

 (4) KREOS CAPITAL V (UK) LIMITED 

(as Agent) 
 (5) KREOS CAPITAL V
(UK) LIMITED 
 (as Security Agent) 
  

 
 LOAN
AGREEMENT 
  
  

5 Fleet Place London EC4M 7RD 

Tel: +44 (0)20 7203 5000 ● Fax: +44 (0)20 7203 0200 ● DX: 19 London/Chancery Lane 

www.charlesrussellspeechlys.com 

 Loan Summary 

This summary is to facilitate reporting and is not binding on either the Lenders or the Borrower. 

 

			
	Term Loan Amount	  	 £20,000,000, in two tranches of £10,000,000 each.

 

	Availability Period	  	 Tranche 1 available at Closing.
  

Tranche 2 available through to 30 April
 2018.

 

	Interest Rate	  	 9% fixed per annum.
  

	Loan Term	  	 Tranche 1: Interest only until 30 September 2018 and repayment of interest and principal by 31 March 2021.

 
 Tranche 2: Subject to completion of T2 Conditions, interest only until 30 September 2018
and repayment of interest and principal by 31 March 2021.
  

	T2 Conditions	  	 Evidence reasonably satisfactory to Lenders that Acumapimod or BGS-649 Phase 2 clinical trials have met all necessary endpoints in accordance
with Clause 3.2 and as described in Exhibit F.
  

	Interest only extension	  	 Extendable to 31 December 2018 for both Tranche 1 and Tranche 2 if evidence satisfactory to the Lenders is delivered that £25,000,000
of additional equity has been raised by 30 September 2018, but with no extension of Final Repayment Date.
  

	Arrangement Fee	  	 1.00% of the Term Loan Amount payable on the Closing Date.

 

	Final Payment	  	 7.5% of the Term Loan Amount.
  

 CONTENTS 
  

							
	 1
	 	 DEFINITIONS AND INTERPRETATIONS
	  	 	1	 
			
	 2
	 	 LOAN AND TERMS OF PAYMENT
	  	 	1	 
			
	 3
	 	 CONDITIONS OF LOANS
	  	 	7	 
			
	 4
	 	 SECURITY DOCUMENTS
	  	 	11	 
			
	 5
	 	 REPRESENTATIONS AND WARRANTIES
	  	 	11	 
			
	 6
	 	 AFFIRMATIVE COVENANTS
	  	 	16	 
			
	 7
	 	 BANKING
	  	 	21	 
			
	 8
	 	 FURTHER ASSURANCES
	  	 	22	 
			
	 9
	 	 NEGATIVE COVENANTS
	  	 	22	 
			
	 10
	 	 EVENTS OF DEFAULT
	  	 	24	 
			
	 11
	 	 FINANCE PARTIES RIGHTS, REMEDIES AND OBLIGATION
	  	 	28	 
			
	 12
	 	 GUARANTEE AND INDEMNITY
	  	 	43	 
			
	 13
	 	 NOTICES
	  	 	47	 
			
	 14
	 	 AGENCY AND SECURITY TRUST DEED
	  	 	48	 
			
	 15
	 	 CHOICE OF LAW AND JURISDICTION
	  	 	48	 
			
	 16
	 	 GENERAL PROVISIONS
	  	 	49	 
			
	 17
	 	 DEFINITIONS
	  	 	53	 
		
	 EXHIBIT A LOAN PAYMENT/ADVANCE REQUEST FORM
	  	 	73	 
		
	 EXHIBIT B COMPLIANCE CERTIFICATE
	  	 	75	 
		
	 EXHIBIT C CLIENT PAYMENT INSTRUCTIONS
	  	 	77	 
		
	 EXHIBIT D FORM OF ACCESSION DEED
	  	 	78	 
		
	 EXHIBIT E FORM OF PERFECTION CERTIFICATE
	  	 	80	 
		
	 EXHIBIT F PRIMARY AND SECONDARY ENDPOINTS
	  	 	90	 

 THIS LOAN AGREEMENT is made on 7 August 2017 

BETWEEN: 
  

	(1)	MEREO BIOPHARMA GROUP PLC a public limited company established in England and Wales under company number 09481161 with registered office at 4th Floor, 1 Cavendish Place, London W1G 0QF (the
“Borrower”); 

  

	(2)	THE GUARANTORS; 

  

	(3)	SILICON VALLEY BANK (“SVB”) a California corporation, with its principal place of business at 3003 Tasman Drive, Santa Clara, California 95054 US and registered in England & Wales under
numbers BR014561 and FC029579 acting through its UK branch at Alphabeta 14-18 Finsbury Square, London, EC2A 1BR and KREOS CAPITAL V (UK) LIMITED (“Kreos”) a limited liability company incorporated under the laws of
England & Wales with company number 09728300 and its registered office at 25 Old Burlington Street London W1S 3AN (each a “Lender” and together the “Lenders”); 

 

	(4)	KREOS CAPITAL V (UK) LIMITED a limited liability company incorporated under the laws of England & Wales with company number 09728300 and its registered office at 25 Old Burlington Street London W1S 3AN
(in its capacity as agent the “Agent”); and 

  

	(5)	KREOS CAPITAL V (UK) LIMITED a limited liability company incorporated under the laws of England & Wales with company number 09728300 and its registered office at 25 Old Burlington Street London W1S 3AN
(in its capacity as security agent the “Security Agent”). 

 AGREED TERMS: 

 

	1	DEFINITIONS AND INTERPRETATIONS 

 Capitalised terms not otherwise defined in this
Agreement shall have the meanings set out in Clause 17 (Definitions) and the principles of interpretation set out in Clause 17 (Definitions) shall apply to this Agreement. 
  

	2	LOAN AND TERMS OF PAYMENT 

  

	2.1	Term Loan 

  

	 	2.1.1	Facility 

 Subject to the terms of this Agreement and during the Availability Period
only, Kreos agrees to make available to the Borrower the Kreos Commitment and SVB agrees to make available to the Borrower the SVB Commitment. The obligations of the Lenders to make the Kreos Commitment and the SVB Commitment are several. 

  
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	 	2.1.2	Interim Payment 

 If the Drawdown Date is not the first Business Day of a calendar
month, the Borrower shall pay to the Agent on behalf of the Lenders on the Drawdown Date (by way of deduction by the Agent of the amount of the Term Loan actually advanced to the Borrower on the Drawdown Date) the Interim Payment. 

 

	 	2.1.3	Advance Payment 

 Following the delivery by the Borrower of a Loan Payment/Advance
Request Form to the Agent, the Borrower agrees to pay to Agent on behalf of the Lenders an Advance Payment in respect of the Term Loan to be held by the Agent and applied in or towards payment of the last Monthly Repayment. 

 

	 	2.1.4	Cancellation of unused Facility 

 If Tranche 1 of the Facility is not drawn during its
Availability Period, then the whole Facility shall be cancelled automatically at the end of such Availability Period. If Tranche 2 of the Facility is not drawn down during its Availability Period, then the Facility relating to Tranche 2 shall be
cancelled automatically at the end of such Availability Period and the Facility related to Tranche 1 shall not be affected by such cancellation. 
  

	2.2	Repayment 

  

	 	2.2.1	The Obligors agree to pay to the Agent on behalf of the Lenders the unpaid principal amount of all Credit Extensions and interest on the unpaid principal amount of any Credit Extensions as and when due in accordance
with this Agreement and as per the Repayment Schedule accompanying the Loan Payment/Advance Request Form or as the same may subsequently be updated or revised in accordance with the terms hereof. 

 

	 	2.2.2	On the Final Repayment Date, the Obligors shall repay the Term Loan in full together with all accrued unpaid interest and all other amounts accrued or outstanding under the Loan Documents. 

 

	2.3	Repayment of Term Loan 

 Subject to Clause 2.3.3, the initial Repayment Schedule for
Tranche 1 and Tranche 2 shall state that: 
  

	 	2.3.1	the Borrower shall only pay interest (and not principal) on the Term Loan for the period from (and including) the Drawdown Date to (and including) 30 September 2018 (“Interest Only Period”);

  

	 	2.3.2	following the expiry of the Interest Only Period, the Borrower shall repay the Term Loan in thirty (30) equal instalments of interest and principal on the first Business Day of each month in accordance with the
Repayment Schedule (the “Monthly Repayments”); and 

  
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	 	2.3.3	If prior to 30 September 2018, the Borrower shall raise at least £25,000,000 of equity, the Interest Only Period for both Tranche 1 and, if applicable, Tranche 2 shall continue until 31 December 2018 and the
following Monthly Repayments shall reduce from 30 to 27. 

  

	2.4	Permitted Prepayment of Term Loan 

  

	 	2.4.1	The Borrower shall have the option to prepay prior to the Final Repayment Date either or both Tranches (but not part of a Tranche), advanced by Lenders under this Agreement, provided that no Event of Default shall have
occurred and be continuing and provided that the Borrower (i) provides written notice to Agent of its election to prepay the such Tranche(s) at least fifteen (15) days prior to such prepayment (save in the case of the Borrower being
acquired or merged with another person in accordance with Clause 9.3 (Mergers or Acquisitions) where at least seven (7) days prior notice is required and such notice of prepayment being conditional upon completion of merger or acquisition), and
(ii) Borrower pays, on the date of such prepayment: 

  

	 	(a)	all outstanding principal amount of the Tranche(s) plus all accrued and unpaid interest; 

  

	 	(b)	future interest (as set out in the most recent Repayment Schedule issued by Agent), discounted at the rate of four per cent. (4%) per annum, such discount being applied pro rata in respect of any part year
(“Term Loan Early Termination Fee”); 

  

	 	(c)	the Final Payment, plus 

  

	 	(d)	all other sums, if any, that shall have become due and payable, including any interest payable at the Default Rate. 

  

	 	2.4.2	If a payment date under Clause 2.2 (Repayment) falls on a day which is not a Business Day, the relevant payment date shall be the next Business Day in that calendar month (if there is one) or the preceding Business Day
(if there is not). 

  

	2.5	Mandatory Prepayment 

 The Obligors shall promptly and without delay repay all
Obligations should any of the following events occur: 
  

	 	2.5.1	at any time any act, condition or thing required to be done, fulfilled or performed by an Obligor in order to: 

  

	 	(a)	enable that Obligor to lawfully enter into, exercise its rights under or perform the obligations expressed to be assumed by it in the Loan Documents to which it is a party; 

  
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	 	(b)	ensure that the obligations expressed to be assumed by that Obligor in the Loan Documents to which it is a party are legal, valid and binding save for any registration at Companies House under the Companies Act or any
other registration at any applicable public register (including at the Intellectual Property Office in the UK and the US and HM Land Registry (as applicable)); or 

 

	 	(c)	make the Loan Documents to which it is a party admissible in evidence in England and Wales, 

is not done, fulfilled or performed within any time available to ensure compliance with the same. 

 

	 	2.5.2	at any time it is or becomes unlawful for an Obligor to perform or comply with any of its material obligations under the Loan Documents or such obligations are not, or cease to be, legal, valid and binding on any
Obligor. 

  

	2.6	Mandatory Prepayment upon an Acceleration 

  

	 	2.6.1	If the Term Loan is accelerated following the occurrence of an Event of Default which is continuing, the Obligors shall immediately pay to Agent an amount equal to the sum of: (i) all outstanding principal plus
accrued interest and future interest, (ii) the Final Payment, plus (iii) all other sums, if any, that shall have become due and payable, including interest at the Default Rate with respect to any past due and unpaid amounts.

  

	 	2.6.2	The Agent shall have the right to issue a revised Repayment Schedule from time to time (and the Obligors acknowledge that the amount required to be repaid pursuant to Clause 2.2 (Repayment) may be increased from time to
time in accordance with any revised Repayment Schedule) if the Agent, having consulted and agreed in writing with any Obligor, considers it necessary in order to ensure that, in respect of each Credit Extension, on the Final Repayment Date there
will be no amounts owing from the Obligors to the Finance Parties pursuant to the Loan Documents. 

  

	2.7	Purpose 

  

	 	Borrower	shall apply amounts borrowed by it under the Facility towards its general working capital purposes. 

  

	2.8	Final Payment 

 On the earlier of: 

 

	 	2.8.1	The Final Repayment Date; 

  
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	 	2.8.2	the date of a permitted prepayment of the whole of the Term Loan (in accordance with Clause 2.4 (Permitted Prepayment of Term Loan)); 

 

	 	2.8.3	the date of a mandatory repayment under Clause 2.5 (Mandatory Prepayment); or 

  

	 	2.8.4	the date of acceleration of the Facility prior to the Final Repayment Date (in accordance with Clause 2.6 (Mandatory Prepayment upon an Acceleration)); and 

 

	 	2.8.5	when the Agent declares the Obligations immediately due and payable pursuant to Clause 11 (Finance Parties rights, remedies and obligation), 

an Obligor shall pay, in addition to the outstanding principal, accrued and unpaid interest, and all other amounts due on such date with
respect to the Term Loan, the Final Payment. 
  

	2.9	Payment of Interest on Term Loan 

  

	 	2.9.1	Interest Rate Term Loan 

 Subject to Clause 2.9.2 (Default Rate), the Term Loan shall
accrue interest at a fixed rate equal to nine per cent. (9%) per annum as more particularly set out in the Repayment Schedule. Interest shall be payable in accordance with Clause 2.9.5 (Payments) below. 

 

	 	2.9.2	Default Rate 

 Immediately upon the occurrence and during the continuance of an Event of
Default, Obligations shall bear interest at a rate per annum which is three per cent. (3%) above the rate that is otherwise applicable thereto (the “Default Rate”) unless Agent otherwise elects from time to time in its discretion to
impose a smaller increase. Fees and expenses which are required to be paid by an Obligor pursuant to the Loan Documents (including Lender Expenses) but are not paid when due shall bear interest until paid at a rate equal to the Default Rate. Payment
or acceptance of the increased interest rate provided in this Clause 2.9.2 (Default Rate) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or
remedies of Lender. 
  

	 	2.9.3	Computation 

 In computing interest, the date of the making of any Credit Extension
shall be included and the date of payment shall be excluded; provided, however, that if any Credit Extension is repaid on the same day on which it is made, such day shall be included in computing interest on such Credit Extension. Interest on
Term Loan is computed on the basis of a 365 day year for the actual number of days elapsed. 

  
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	 	2.9.4	Debit of Accounts 

  

	 	(a)	In the event any Obligor should fail to comply with the Obligations, the Finance Parties may debit any deposit or operating account of any Obligor held with a Finance Party for principal and interest payments when due,
or any other amounts any Obligor owes to the Finance Parties. 

  

	 	(b)	The Finance Party shall promptly notify the relevant Obligor after it debits that Obligor’s accounts. 

  

	 	2.9.5	Payments 

 Subject to Clause 2.3 (Repayment of Term Loan), the Borrower shall pay
interest monthly on the first calendar day of Repayment Date and in any event in accordance with the Repayment Schedule. 
  

	2.10	Fees 

 Borrower shall pay to Agent: 

 

	 	2.10.1	Arrangement Fee 

 A fully earned, non-refundable arrangement fee of the Two Hundred
Thousand Pounds (£200,000) due and payable on the Closing Date (the “Arrangement Fee”) to be deducted from the Tranche 1 loan amount; 
  

	 	2.10.2	Lender Expenses 

 All Lender Expenses when due. For the avoidance of doubt, the deposit
of Thirty Thousand Pounds (£30,000) (“Deposit”) held by the Agent shall be applied towards such Lender Expenses and the Arrangement Fee; and 
  

	 	2.10.3	Final Payment 

 The Final Payment, when due hereunder. 

 

	2.11	Payments; Application of Payments 

  

	 	2.11.1	All payments (including prepayments) to be made by any Obligor under any Loan Document shall be made in immediately available funds, without set-off or counterclaim, before midday London time on the date when due.
Payments of principal and/or interest received after midday London time are considered received at the opening of business on the next Business Day. When a payment is due on a day that is not a Business Day, the payment shall be due the next
Business Day, and additional fees or interest, as applicable, shall continue to accrue until paid. 

  

	 	2.11.2	All payments of principal and interest (including prepayments) to be made by Borrower and all payments of any fees due under this Agreement to be made by Borrower shall be made to Lenders accounts, as set out in
Exhibit C (Client Payment Instructions) of this Agreement. 

  
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	3	CONDITIONS OF LOANS 

  

	3.1	Conditions Precedent to Closing and Credit Extension of Tranche 1 

 Closing is subject to
the condition precedent that Agent shall have received, in form and substance satisfactory to Agent, such documents and completion of such other matters, as Agent may reasonably deem necessary or appropriate (provided the Agent has notified the
Borrower), including the following: 
  

	 	3.1.1	this Agreement duly executed by Borrower and the Guarantors; 

  

	 	3.1.2	the Security Documents, each executed by Borrower and/or Guarantors; 

  

	 	3.1.3	a certificate of a director of Obligors with respect to their constitutional documents and resolutions of the relevant corporate bodies (i) approving the terms of, and the transactions contemplated by, the Loan
Documents to which an Obligor is a party and resolving that it execute, deliver and perform the Loan Documents to which it is a party, (ii) authorising a specified person or persons to execute the Loan Documents to which it is a party on its
behalf, and (iii) authorising a specified person or persons, on its behalf, to sign and/or despatch all documents and notices to be signed and/or despatched by it under or in connection with the Loan Documents to which it is a party;

  

	 	3.1.4	the provision of a certified copy of the resolutions of each Obligor’s board of directors (other than in respect of the Borrower, which shall provide resolutions from its duly appointed Finance Committee, which was
constituted pursuant to a prior resolution of the directors of the Borrower at a board meeting of the Borrower on 27 June 2017) authorising the transactions contemplated by this Loan Agreement and the execution and delivery to the Lender of this
Loan Agreement and associated documents, including but not limited to, the Loan Documents; 

  

	 	3.1.5	certified copies of the Certificate of Incorporation and the Memorandum and Articles of Association of each Obligor; 

  

	 	3.1.6	a certificate of a director of the Borrower and each Guarantor in the agreed form confirming that the borrowing of the Loan Facility in full would not cause any borrowing limit binding on the Borrower or each Guarantor
to be exceeded; 

  

	 	3.1.7	specimen signatures, authenticated by a director or the company secretary of the Borrower and each Guarantor, of the persons authorised to execute and deliver this Loan Agreement and associated documents including but
not limited to, the Loan Documents, in the resolutions of the board of directors referred to in Clause 3.1.4; 

  
 7 

	 	3.1.8	a Perfection Certificate in respect of the Obligors signed by a Responsible Officer of the Borrower; 

  

	 	3.1.9	an Agency and Security Trust Deed executed by Borrower; 

  

	 	3.1.10	the Mereo Guarantee Letter, duly executed by all parties; 

  

	 	3.1.11	the Warrant Instrument and Warrant Certificates in favour of Kreos Capital V (Expert Fund) LP and SVB respectively; 

  

	 	3.1.12	evidence reasonably satisfactory to Agent that the insurance policies required by Clause 6.5 (Insurance) are in full force and effect; 

 

	 	3.1.13	payment of the fees and Lender Expenses then due and payable; 

  

	 	3.1.14	signed consent for Lenders to: (i) use Borrower’s logo; (ii) use a tombstone to highlight the transaction; and (iii) issue a press release in a form acceptable to Borrower and Lenders highlighting
and summarising the credit facilities extended by Lenders to Borrower under this Agreement, for marketing purposes, provided that no press release or other public announcement will be made by the Lenders until after the Borrower has made its own
public announcement; 

  

	 	3.1.15	the representations and warranties in Clause 5 (Representations and Warranties) shall be true in all material respects on the Closing Date; provided, however, that such materiality qualifier shall not be applicable to
any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete
in all material respects as of such date, and no Event of Default shall have occurred and be continuing or result from Closing. 

  

	 	3.1.16	in Agent’s reasonable discretion, there has not been any material impairment in the general affairs, management, results of operation, financial condition or the prospect of repayment of the Obligations, or any
material adverse deviation by Borrower from the most recent business plan of Borrower presented to and accepted by Agent; 

  

	 	3.1.17	the Subordination Agreement duly executed by Novartis, the Finance Parties and the Obligors; 

  

	 	3.1.18	except as otherwise provided in Clause 3.3 (Covenant to Deliver), timely receipt of the Loan Payment/Advance Request Form (which for the avoidance of doubt may be completed and submitted by the Borrower prior to the
execution of this Agreement and which shall become effective upon the execution of this Agreement); 

  

	 	3.1.19	Powers of Attorney for any documents required by this Agreement; and 

  
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	 	3.1.20	such other documents, and completion of such other matters, as Agent may reasonably deem necessary or appropriate. 

  

	3.2	Conditions Precedent to Credit Extension of Tranche 2 

 The Lenders’ obligation to
make the initial Credit Extension for Tranche 2 is subject to the following conditions: 
  

	 	3.2.1	Delivery to the Agent of evidence reasonably satisfactory to the Lenders that (i) the Acumapimod (BCT-197) or BGS-649 Phase 2 trials have met all necessary primary endpoints as described in Exhibit F in line with
the agreed trial designs; and (ii) the Acumapimod (BCT-197) or BGS-649 Phase 2 trials have met sufficient secondary endpoints as described in Exhibit F in line with the agreed trial design such that there is agreement by the board of directors
that the asset(s) can move into the next phase of clinical development via the Borrower or a partner organisation (subject to evidence of such agreement by the board of directors also being provided); 

 

	 	3.2.2	except as otherwise provided in Clause 3.3 (Covenant to Deliver), timely receipt of the Loan Payment/Advance Request Form; 

  

	 	3.2.3	an updated Perfection Certificate in relation to the Obligors signed by a Responsible Officer of the Borrower; 

  

	 	3.2.4	the Warrant Certificates in favour of Kreos Capital V (Expert Fund) LP and SVB respectively; 

  

	 	3.2.5	payment of the fees and Lender Expenses then due and payable; 

  

	 	3.2.6	the representations and warranties in Clause 5 (Representations and Warranties) shall be true in all material respects on the date of the Loan Payment/Advance Request Form; provided, however, that such materiality
qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided further that those representations and warranties expressly referring to a specific date
shall be true, accurate and complete in all material respects as of such date, and no Event of Default shall have occurred and be continuing or result from the Credit Extension. Each Credit Extension is Borrower’s representation and warranty on
that date that the representations and warranties in this Agreement remain true, accurate, and complete in all material respects; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such
date; 

  

	 	3.2.7	 in Agent’s reasonable discretion, there has not been any material impairment in the general affairs,
management, results of operation, 

  
 9 

	 	
financial condition or the prospect of repayment of the Obligations, or any material adverse deviation by Borrower from the most recent business plan of Borrower presented to the Agent; and

  

	 	3.2.8	such other documents, and completion of such other matters, as Agent may reasonably deem necessary or appropriate. 

  

	3.3	Covenant to Deliver 

 The Obligors agree to deliver to Agent each item required to be
delivered to Agent under this Agreement as a condition precedent to any Credit Extension. The Obligors expressly agree that a Credit Extension made prior to the receipt by Agent of any such item shall not constitute a waiver by Agent of
Borrower’s obligation to deliver such item, and the making of any Credit Extension in the absence of a required item shall be in Agent’s sole discretion. 
  

	3.4	Procedures for Borrowing 

 Together with any such electronic or facsimile notification,
Borrower shall deliver to Agent by electronic mail or facsimile the completed Loan Payment/Advance Request Form executed by a Responsible Officer or his or her designee. Agent may rely on any telephone notice given by a person whom the Agent
believes is a Responsible Officer or designee. Subject to the prior satisfaction of all other applicable conditions to the making of the Term Loan set out in this Agreement and in accordance to Clause 2.1 (Term Loan) above, to obtain the Term Loan,
Borrower must notify Agent (which notice shall be irrevocable) by electronic mail, or telephone by midday London time (i) on, or within one Business Day after, the date of this Agreement (in respect of Tranche 1 only) and (ii) on or before
30 April 2018 (in respect of Tranche 2 only) or such other date as Agent may in its absolute discretion agree. Such notice shall be in the form of a completed Loan Payment/Advance Request Form in the form attached as Exhibit
A and shall specify (i) the date the Term Loan is to be made (which in respect of Tranche 1 only shall be a date falling at least 10 Business Days after the date of this Agreement), subject to the provisions of this Clause 3.4;
(ii) the amount of such Term Loan; and (iii) such other procedural requirements as Agent has notified to Borrower in advance of the Drawdown Date. If such notification is by telephone, Borrower must promptly confirm the notification by
delivering to Agent a completed Loan Payment/Advance Request Form in the form attached at Exhibit A. The Lenders shall transfer the Term Loan to Borrower’s sterling deposit account held with Silicon Valley Bank. The Lenders
may make the Term Loan based on instructions from a Responsible Officer or his or her designee or without instructions if the Term Loan is necessary to meet Obligations which have become due. The Finance Parties may rely on any telephone notice
given by a Person whom the Finance Parties reasonably believe is a Responsible Officer or designee. The Obligors shall indemnify the Finance Parties for any loss the Finance Parties suffer due to such reliance unless caused by the Finance Parties
negligence or intentional misconduct. 

  
 10 

	3.5	Conditions Subsequent 

 Promptly and without delay after the Credit Extension of Tranche
1, the Borrower shall instruct its patent agents or appropriate local counsel, to prepare and deliver the documents required to register the Lenders’ security interests over the Patents which exist as at the date of this Loan Agreement to the
patent registries of UK, USA as soon as possible and thereafter use all commercially reasonable endeavours to achieve registration of the Lenders’ security interests thereon. If any objection or challenge to such registration is received or if
any delay in such registration occurs or is likely to occur, the Borrower shall forthwith inform the Agent thereof, and, without prejudice to the Lenders rights hereunder, agree how to deal with such objection, challenge or delay. The Agent may,
after having provided not less than 10 Business Days’ notice to the Borrower of its intention to do the following, take on the registration process from the Borrower at the cost of and with the continuing assistance of the Borrower at any time.

  

	4	SECURITY DOCUMENTS 

  

	4.1	All Obligations shall be secured by any and all present and future properties, rights and assets of Obligors, in respect of which Obligors have granted to Security Agent a security interest now, or in the future, as set
out in the Debentures and all other security agreements, mortgages or other collateral granted by an Obligor to Security Agent as security for the Obligations now or in the future (collectively, such properties, rights and assets being the
“Collateral”). Each Obligor represents, warrants and covenants that the security interests granted or to be granted in favour of Security Agent, save in respect of the Permitted Liens, shall at all times after the creation and
initial perfection of such interest in favour of the Security Agent continue to be a first priority perfected security interest in the Collateral (it being acknowledged by the parties hereto that perfection of a security interest shall only be
required to the extent (and in the jurisdictions) set out in the Loan Documents). If this Agreement is terminated, Security Agent’s Lien and security interest in the Collateral shall continue until the Obligations are fully satisfied.

  

	5	REPRESENTATIONS AND WARRANTIES 

 Each Obligor, as the case may be, represents and
warrants to the Finance Parties as follows: 
  

	5.1	Due Incorporation and Authorisation; Power and Authority 

  

	 	5.1.1	 The Borrower is a public company and each Guarantor is a private company with limited liability, duly
incorporated and validly existing under the laws of England and Wales and has power to carry on its business as it is now being conducted and to own its property and other assets. In connection with this Agreement, the Borrower has delivered to the
Agent a certificate signed by it and, entitled “Perfection Certificate” (the “Perfection Certificate”) relating to itself and each Guarantor. Each Obligor represents and warrants to the Finance Parties that: (a) its
exact legal 

  
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	 	name is that indicated on the Perfection Certificate and on the signature page hereof; and (b) it is an organisation of the type, and is incorporated in the jurisdiction, set out in the Perfection Certificate; and
(c) the Perfection Certificate accurately sets out each Obligor’s registered number; and (d) the Perfection Certificate accurately sets out such Obligor’s corporate seat and its registered office as well as such Obligor’s
postal address if different from its registered office, and (e) all other information set out in the Perfection Certificate pertaining to such Obligor and each of its Subsidiaries including as to its assets and liabilities, the material
Copyrights, Trademarks and Patents is accurate and complete (it being understood and agreed that such Obligor may from time to time update certain information in the Perfection Certificate after the Closing Date to the extent permitted by one or
more specific provisions in this Agreement). 

  

	 	5.1.2	The execution, delivery and performance of this Agreement and the other Loan Documents to which any Obligor is a party are within the corporate powers of such Obligor, have been duly authorised by all necessary
corporate and other action and do not and will not conflict with (i) any law or regulation applicable to it; (ii) the constitutional documents of such Obligor or any other organisational documents; (iii) any agreement or instrument
binding on such Obligor or (iv) require any action by, filing, registration, or qualification with, or Governmental Approval from, any Governmental Authority (except such Governmental Approvals which have already been obtained and are in full
force and effect and customary filings with any Governmental Authority necessary to register or perfect any Lien created pursuant to the Loan Documents) or (v) constitute an event of default under any material agreement by which such Obligor is
bound. Each Obligor is not in default under any agreement to which it is a party or by which it or its assets are bound in which the default could reasonably be expected to have a material adverse effect on such Obligor’s business.

  

	 	5.1.3	No Obligor is a FATCA FFI or a US Tax Obligor. 

  

	5.2	Collateral 

  

	 	5.2.1	Each Obligor has good title to the Collateral, free of Liens except Permitted Liens or any Lien arising in the ordinary course of business of such Obligor which is discharged in the ordinary course of business of such
Obligor. Each Obligor has no deposit accounts other than the deposit accounts, if any, described in the Perfection Certificate delivered to Agent in connection herewith, or of which such Obligor has given Agent notice and taken such actions as are
necessary to give Security Agent a perfected security interest therein. The Accounts are bona fide, existing obligations of each relevant Account Debtor. 

  

	 	5.2.2	 The Collateral is not in the possession of any third party bailee (such as a warehouse) except as otherwise
provided in the Perfection Certificate. 

  
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	 	None of the components of any tangible Collateral shall be maintained at locations other than as provided in the Perfection Certificate or as permitted pursuant to Clause 9.6 (Encumbrance). 

 

	 	5.2.3	Each Obligor is the sole owner of the Intellectual Property which it owns or purports to own except for (a) non-exclusive licences granted to its customers, agents, partners or suppliers, in the ordinary course of
business, (b) over-the-counter software that is commercially available to the public, and (c) material Intellectual Property licensed or sub-licensed to such Obligor and noted on the Perfection Certificate. Save in respect of any Permitted
Liens, each Obligor’s Intellectual Property is not subject to any Liens. To the knowledge of each Obligor, each Patent which it owns or purports to own and which is material to such Obligor’s business is valid and enforceable, and no part
of the Intellectual Property which Borrower owns or purports to own and which is material to such Obligor’s business has been adjudged invalid or unenforceable, in whole or in part. To the best of each Obligor’s knowledge, no claim has
been made that any part of the Intellectual Property infringes the rights of any third party except to the extent such claim would not reasonably be expected to have a material adverse effect on such Obligor’s business. 

 

	 	5.2.4	Except as noted on the Perfection Certificate, each Obligor is not a party to, nor is it bound by, any Restricted Licence. 

  

	5.3	Litigation 

 There are no actions or proceedings pending or, to the knowledge of such
Obligor’s Responsible Officers or legal counsel, threatened (save for any speculative claims by employees or former employees or oppositions to any third party intellectual property filings in the ordinary course of an Obligor’s protection
of its intellectual property rights) by or against such Obligor or any of its Subsidiaries or Affiliates, involving more than, individually or in the aggregate, One Hundred Thousand Pounds (£100,000) (or its equivalent in any other
currency. 
  

	5.4	Financial Statements; Financial Condition 

  

	 	5.4.1	All consolidated financial statements for the Obligors and any of their Subsidiaries and/or Affiliates (if any) truly and fairly present the Group’s financial condition and results of operations. There has not been
any material deterioration in the Group’s assets, liabilities, financial condition or prospects as a whole since the date of such financial statements (“Accounts Date”). 

 

	 	5.4.2	The unaudited consolidated management accounts of the Borrower and its Subsidiaries since the Accounts Date up to 30 June 2017 (“Management Accounts Date”) fairly present the assets, liabilities,
financial condition and prospects of the Group and so far as the Borrower is aware there has been no material deterioration in the Group’s assets, financial condition or prospects since the Management Accounts Date. 

  
 13 

	5.5	Forecasts and projections 

 All unaudited forecasts and projections supplied by or on
behalf of an Obligor to the Agent were carefully prepared and believed by such Obligor to be not misleading in any material respect at the date on which they were provided. 
  

	5.6	Solvency 

 No: 
  

	 	5.6.1	corporate action, legal proceeding or other procedure or step described in Clause 10.5 (Insolvency and insolvency proceedings); or 

  

	 	5.6.2	attachment described in Clause 10.4 (Attachment), 

 has been taken or, to the knowledge of each
Obligor, is threatened or pending in relation to such Obligor. 
  

	5.7	Centre of main interests 

 For the purposes of Regulation (EU) 2015/848 of 20 May 2015 on
insolvency proceedings (recast) (the “Regulation”), its centre of main interest (as that term is used in Article 3(1) of the Regulation) is situated in England and Wales. 

 

	5.8	Regulatory Compliance 

 To the best of each Obligors’ knowledge, each Obligor has
not breached any laws, ordinances or rules or regulations, the breach of which could reasonably be expected to cause a Material Adverse Change. None of any Obligor’s (or any of its Subsidiaries/Affiliates) property or assets has been used by
such Obligor or, to the best of such Obligor’s knowledge, by previous Persons, in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. Each Obligor (and each of its Subsidiaries/Affiliates) has
obtained all consents, approvals and authorisations of, made all declarations or filings with, and given all notices to, all Government Authorities that are necessary to continue its business as currently conducted, except where the failure to do so
could not reasonably be expected to be detrimental to such Obligor’s business. 
  

	5.9	Subsidiaries; Investments 

 Each Obligor does not own any stock, partnership interest or
other equity securities except for Permitted Investments. 
  

	5.10	Taxation 

 Each Obligor has complied in all material respects with all Taxation laws in
all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it and no claims are being asserted against it in respect of Taxes save for 

  
 14 

 
assessments in relation to the ordinary course of the business of such Obligor or claims contested in good faith and in respect of which adequate provision has been made and disclosed in the
latest accounts of such Obligor or information delivered to Agent under this Agreement. 
  

	5.11	Full Disclosure 

 No written representation, warranty or other statement of any Obligor
in any certificate or written statement given to Agent, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Agent, contains any untrue statement
of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognised by Agent that the projections and forecasts provided by such Obligor in good faith
and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results). 

 

	5.12	No winding-up 

 Each Obligor has not taken any corporate or other action nor has any
application been made or have any other steps been taken or legal proceedings been started or (to the best of such Obligor’s knowledge and belief having made due and proper enquiry) threatened against such Obligor or any of its
Subsidiaries/Affiliates for its winding-up or for the appointment of a trustee, liquidator, receiver, administrative receiver, administrator or similar officer of it or of any or all of its assets. 

 

	5.13	AIM Status 

 The shares of the Borrower are duly admitted to trading on AIM and no
circumstances exist to the Borrower’s knowledge which are reasonably likely to cause the suspension or cancellation of such admission. The Borrower has complied and continues to comply with all AIM Rules and Disclosure and Transparency Rules
and the Market Abuse Regulation as applicable to it. 
  

	5.14	Patents 

 The Borrower owns the Patents and has good title to, has rights in, and the
power to transfer each of the Patents. 
  

	5.15	Licences 

 Other than as previously disclosed to the Agent in the Perfection Certificate,
each Obligor is not a party to, nor is bound by, any material licence (other than over the counter software that is commercially available to the public) or other material agreement with respect to which such Obligor is the licensee that prohibits
or otherwise restricts such Obligor from granting a charge in such Obligor’s interest in such licence or agreement or any other property. Each Obligor shall provide written notice to Agent within fifteen (15) days of entering or becoming
bound by, any such 

  
 15 

 licence or agreement which is reasonably likely to have a material impact on Borrower’s
business or financial condition. Each Obligor shall take such steps as Agent reasonably requests to obtain the consent of, authorisation by or waiver by, any Person whose consent or waiver is necessary for all such licences or contract rights to be
deemed Collateral and for Agent to have a charge in it that might otherwise be restricted or prohibited by law or by the terms of any such licence or agreement, whether now existing or entered into in the future. 

 

	5.16	Subordinated debt 

  

	 	5.16.1	All amounts due to officers, directors, shareholders, the holder(s) of the Convertible Loans and any secured creditors (other than Lenders) of each Obligor have been subordinated to the Obligations. 

 

	 	5.16.2	No amounts are due to officers, directors, shareholders of any Obligor. 

  

	5.17	Novartis 

 All amounts due and any obligations under the Novartis Acquisition Agreement
as at the date of this Agreement by an Obligor have been duly paid or satisfied (as the case may be). 
  

	5.18	Definition of “Knowledge” 

 For purposes of the Loan Documents, whenever a
representation or warranty is made to any Obligor’s knowledge or awareness, to the “best of” such Obligor’s knowledge, or with a similar qualification, knowledge or awareness means the actual knowledge, after reasonable
investigation, of the Responsible Officers. 
  

	6	AFFIRMATIVE COVENANTS 

 Each Obligor shall do the following: 

 

	6.1	Government Compliance 

  

	 	6.1.1	Maintain its legal existence and good standing in its jurisdiction of incorporation and maintain qualification in each jurisdiction in which the failure to do so would reasonably be expected to be detrimental to such
Obligor’s business or operations. Each Obligor shall and shall procure that each of its Subsidiaries/Affiliates shall comply with all laws, ordinances and regulations to which it is subject, non-compliance with which could be detrimental to
such Obligor’s business or operations or would reasonably be expected to cause a Material Adverse Change. 

  

	 	6.1.2	Obtain all of the Governmental Approvals (if any) necessary to carry on its business and for the performance by such Obligor of its obligations under the Loan Documents to which it is a party and the grant of a security
interest to Security Agent in all of its present and future property and assets, including the Governmental Approvals for manufacturing licenses. Each Obligor shall promptly provide copies of any such obtained Governmental Approvals to Agent.

  
 16 

	6.2	Financial Statements, Reports, Certificates 

 The Obligors shall deliver to Agent: 

 

	 	6.2.1	Monthly Financial Statements 

 As soon as available, but no later than forty five
(45) days after the last day of each month, (or if sooner, at the same time as they are provided to any investor in the Borrower) a company prepared consolidated (and consolidating for each subsidiary) balance sheet and income statement
covering each Obligor’s and each of its Subsidiary’s operations for such month certified by a Responsible Officer and in a form acceptable to Agent (the “Monthly Financial Statements”); 

 

	 	6.2.2	Monthly Compliance Certificate 

 Within forty five (45) days after the last day of
each month a duly completed Compliance Certificate signed by a Responsible Officer, certifying that as of the end of such month, each Obligor was in full compliance with all of the terms and conditions of this Agreement and such other information as
Agent shall reasonably request; 
  

	 	6.2.3	Annual Audited Financial Statements 

 As soon as available, but within one hundred and
eighty (180) days after each Obligor’s financial year, consolidated financial statements prepared under GAAP, consistently applied, with an opinion on the financial statements from an independent certified public accounting firm acceptable
to Agent in its reasonable discretion; 
  

	 	6.2.4	Other Statements 

 Within five (5) days of delivery, copies of all statements,
reports and notices made available to the holder(s) of the Convertible Loans; 
  

	 	6.2.5	Legal Action Notice 

 A prompt report of any legal actions pending or threatened in
writing against an Obligor or any of its Subsidiaries/Affiliates that could result in damages or costs to such Obligor or any of its Subsidiaries/Affiliates of, individually or in the aggregate, One Hundred Thousand Pounds (£100,000) (or its
equivalent in any other currency) or more; 
  

	 	6.2.6	Intellectual Property Notice 

 Prompt written notice of (i) of any material change
in the composition of the Intellectual Property, and (ii) such Obligor’s knowledge of an event that 

  
 17 

 
could reasonably be expected materially and adversely to affect the value of the Intellectual Property. Additionally, within ten (10) Business Days after each six (6) months anniversary
of the date of this Agreement, prompt written notice of the registration of any ownership right of an Obligor in or to any Patent or Trademark not previously disclosed in writing to Agent in respect of the prior six (6) month period. 

 

	 	6.2.7	Operating Budget 

 Within sixty (60) days after the end of the Borrower’s
financial year an operating plan which includes, without limitation, balance sheet and income statement, operating budgets and reflects projections for such year plus updates or amendments to such budget when available and as approved by the board
of directors; 
  

	 	6.2.8	Other Financial Information 

 Other financial information reasonably requested by Agent;

  

	 	6.2.9	Board Pack 

 As soon as available and on the same date on which it is circulated to the
board of directors but no later than fifteen (15) days after a meeting of the board of directors of any Obligor, such Obligor’s board pack, provided that third party information may be redacted from such board pack in order to comply with
the terms of any confidentiality obligations with such third party binding upon an Obligor. 
  

	6.3	“Know your Customer” checks 

 If: 

 

	 	6.3.1	the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement; 

 

	 	6.3.2	any change in the status of an Obligor or the composition of the shareholders of or control of an Obligor after the date of this Agreement; or 

 

	 	6.3.3	a proposed assignment or transfer by any Finance Party of any of its rights and/or obligations under this Agreement, 

obliges any Finance Party (or, in the case of Clause 6.3.3 above, any prospective new lender) to comply with “know your customer” or
similar identification procedures in circumstances where the necessary information is not already available to it, such Obligors shall promptly upon the request of the Agent supply, or procure the supply of, such documentation and other evidence as
is reasonably requested by the Agent (for itself or, in the case of the event described in Clause 6.3.3 above, on behalf of any prospective new lender) in order for the Finance Parties or, in the case of the event described in Clause 6.3.3 above,
any prospective new lender to carry out and 

  
 18 

 
be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulation pursuant to the transactions contemplated in the
Loan Documents. 
  

	6.4	Taxes; pensions 

 Each Obligor shall make, and cause each of its Subsidiaries/Affiliates
to make, timely payment of all material Taxes or assessments (other than taxes and assessments which such Obligor or a Subsidiary/Affiliate of such Obligor is contesting in good faith, with adequate reserves maintained in accordance with GAAP) and
will deliver to Agent, on demand, appropriate certificates attesting to such payments and pay all amounts necessary to fund all present pension, profit sharing and deferred compensation plans in accordance with their terms. 

 

	6.5	Insurance 

  

	 	6.5.1	Each Obligor shall keep its business and the Collateral insured for risks (including third party liability appropriate to a company undertaking the business of the Company) and in amounts as Agent may reasonably
request. 

  

	 	6.5.2	Insurance policies shall be in a form, with companies, and in amounts that are satisfactory to Agent in its reasonable discretion as are typical for the industry in the UK, for companies similar to each Obligor.

  

	 	6.5.3	At Agent’s request, each Obligor shall deliver copies of policies and evidence of all premium payments. 

  

	 	6.5.4	Following an Event of Default which is continuing, proceeds payable under any property or asset protection policies taken out by each Obligor pursuant to which such Obligor is the ultimate beneficiary of any payment
under such policy (which, for the avoidance of doubt, shall not include proceeds of any insurance policies that, pursuant to their terms, are intended, directly or indirectly, to compensate a third party that is not a member of the Group) shall, at
the Agent’s option, be payable to the Agent on account of the Obligations. 

  

	 	6.5.5	If each Obligor fails to obtain insurance as required under this Clause 6.5 (Insurance) or to pay any amount or furnish any required proof of payment to third persons and Agent, Agent may make all or part of such
payment or obtain such insurance policies required in this Clause 6.5, and take any action under the policies Agent deems prudent. 

  

	6.6	Protection and Registration of Intellectual Property Rights 

  

	 	6.6.1	Each Obligor shall use commercially reasonable endeavours to: 

  

	 	(a)	protect, defend and maintain the validity and enforceability of the material Intellectual Property; 

  
 19 

	 	(b)	promptly advise Agent in writing of material infringements of its Intellectual Property after becoming aware of such material infringements; and 

 

	 	(c)	not allow any Intellectual Property material to such Obligor’s business to be abandoned, forfeited or dedicated to the public without Agent’s prior written consent (not to be unreasonably withheld).

  

	 	6.6.2	If an Obligor: 

  

	 	(a)	obtains any registered patent, registered trademark or servicemark, registered copyright, registered mask work, or any pending application for any of the foregoing, whether as owner, licensee or otherwise, or

  

	 	(b)	applies for any patent or the registration of any trademark or servicemark: 

 then, if the same
are not already secured by the provisions of an existing Security Document, it shall promptly and without delay provide written notice thereof to the Agent and shall execute such intellectual property security agreements and other documents and take
such other actions as the Agent shall reasonably request in its good faith business judgement to perfect and, upon perfection, maintain a first priority perfected Security Interest in favour of the Security Agent in such property, provided
(i) that such perfection shall only extend to and without prejudice to Clause 6.6.3 and Clause 8 (Further assurances), notifying such Security Interest to any intellectual property register in the USA and the UK and (ii) that, to the
extent that an Obligor’s interest in any of the foregoing intellectual property is only as a licensee, any such security shall only be granted in respect of and to the extent of the Borrower’s contractual rights pursuant to the relevant
licence agreement. 
  

	 	6.6.3	If an Obligor decides to register any material copyrights or material mask works in the United States Copyright Office, it shall: 

  

	 	(a)	promptly inform the Agent of any such registration; 

  

	 	(b)	execute an intellectual property security agreement or an intellectual property security confirmation if the relevant intellectual property is already secured by a Debenture and such other documents and take such other
actions as the Agent may reasonably request in its good faith business judgement to perfect and maintain a first priority perfected Security Interest in favour of the Security Agent in the material copyrights or material mask works intended to be
registered with the United States Copyright Office; and 

  
 20 

	 	(c)	record such intellectual property security agreement or security confirmation with the United States Copyright Office contemporaneously with filing the material copyright or material mask work application(s) with the
United States Copyright Office. 

  

	6.7	Clinical Trials 

 The Borrower shall ensure that all clinical trials conducted by it or
on its behalf strictly comply with all applicable Government Approvals and good clinical practice including, but without limitation, Directive 2001/20/EC on the conduct of clinical trials as implemented in the relevant jurisdictions including the UK
(the “Clinical Trials Directive”), any applicable ethics committee approval, the terms of any applicable protocols and any other requirements of the applicable Regulatory Authority, in each case, as is mandatorily required to be
complied with under relevant laws and for the industry in which the Borrower operates, and shall promptly and without delay notify the Lenders of any notification of non-compliance which an Obligor has
received from any relevant governmental or regulatory authority. 
  

	6.8	Litigation Cooperation 

 From the date hereof and continuing until all Obligations have
been irrevocably discharged and Agent has no commitment or liability hereunder, make available (to the extent legally permissible) to Agent, without expense to Lenders, Obligors and their officers, employees and agents and Obligors relevant books
and records, to the extent that Agent may deem them reasonably necessary to institute or defend any third-party action or proceeding instituted by or against Lenders with respect to any Collateral or relating to the Obligors. 

 

	6.9	Access to Collateral; Books and Records 

 Allow Agent, or its agents, at reasonable
times, on ten (10) Business Days’ notice (provided no notice is required if an Event of Default has occurred and is continuing), to inspect the Collateral and audit and copy the relevant Obligors’ Books. Such inspections or audits
shall be conducted no more often than once every twelve (12) months unless an Event of Default has occurred and is continuing and shall be carried out at the reasonable expense of the Obligors. 

 

	7	BANKING 

  

	7.1	During the continuation of this Facility subject to SVB providing terms of business reasonably acceptable to the Obligors and SVB being able to meet the Obligors’ reasonable commercial requirements, each Obligor
shall conduct and arrange all its primary current account banking requirements in the USA and UK with SVB or its Affiliates (except in respect of any banking arrangements with third parties as detailed in the Perfection Certificate), and shall give
to SVB and/or its Affiliates the opportunity to quote on all foreign exchange spot trades and hedging transaction over £50,000 in value before going to any other provider. It being understood that 

  
 21 

	 	
should the Obligors receive an offer from a third bank providing materially better commercial terms, they shall be obliged to notify SVB of such occurrence prior to terminating their banking
relationship with SVB to allow for any notification of a Security Interest to be served on a third bank. 

  

	7.2	The Borrower and each Obligor shall provide the Lenders with the opportunity to offer for additional debt or loan financing in relation to the Group fifteen (15) Business Days prior to the time that such requests
are provided to any other financing sources. 

  

	8	FURTHER ASSURANCES 

  

	8.1	Each Obligor shall without expense to the Lenders execute any further instruments and take further action as Agent reasonably requests to perfect or continue Security Agent’s security interest in the Collateral or
to effect the purposes of this Agreement. 

  

	8.2	Each Obligor shall procure at Agent’s request that any of the Borrower’s wholly- owned Subsidiaries which become subsidiaries after the date hereof, become a guarantor in relation to this Agreement and enters
into such documentation and grants a Lien to Agent in substantially all of its assets, for the sole purpose of securing the Obligations, pursuant to such documentation as may be required by the Agent in the Agent’s sole discretion.

  

	9	NEGATIVE COVENANTS 

 No Obligor shall do any of the following without Agent’s prior
written consent (such consent not to be unreasonably withheld, conditioned or delayed). 
  

	9.1	Dispositions 

 Convey, sell, lease, transfer, assign, or otherwise dispose of
(collectively, “Transfer”), or permit any of its Subsidiaries to Transfer, all or any part of its business or property, except for (i) a Permitted Disposal and/or (ii) Transfers: (a) of Inventory in the ordinary course of
business; (b) of worn out or obsolete Equipment; and (c) in connection with Permitted Liens and Permitted Investments. An Obligor shall not enter into an agreement with any Person other than Agent which restricts the subsequent granting of
a security interest in any Intellectual Property owned by such Obligor, unless such agreement between an Obligor and the foregoing Person contains an exemption to permit any security created pursuant to the Security Documents (which the Obligor
shall use reasonable endeavours to obtain) (an Exemption). It being understood that an Obligor should be able to enter into a licence arrangement pursuant to which any Intellectual Property is licensed to such Obligor, provided that
(i) such arrangement is an arm’s length transaction and the relevant Person is a third party, and (i) the relevant Obligor shall use reasonable endeavours to obtain an Exemption. 

 

	9.2	Changes in Business, Ownership, Management or Business Locations 

  

	 	9.2.1	 Engage in or permit any of its Subsidiaries: to engage in any business other than the businesses currently
engaged in by such Obligor or such 

  
 22 

	 	
Subsidiary or reasonably related thereto as at the Closing Date; (b) to be liquidated or dissolved; or (c) in the case of the Subsidiaries only, to permit or suffer any Change in
Control. 

  

	 	9.2.2	An Obligor shall not, without at least fifteen (15) days prior written notice to Agent: (1) change its jurisdiction of organisation, registration or incorporation, or (2) change its legal name. An Obligor
shall not, without at least five (5) days prior written notice to Agent, change its organisational structure or type. 

  

	 	9.2.3	An Obligor shall within fifteen (15) days after adding any new offices or business locations, including warehouses (unless such new offices or business locations contain less than Fifty Thousand Pounds
(£50,000) (or its equivalent in any other currency)) in such Obligor’s assets or property) or deliver any portion of the Collateral valued, individually or in the aggregate, in excess of One Hundred Thousand Pounds (£100,000) (or
its equivalent in any other currency) to a bailee at a location other than to a bailee and at a location already disclosed in the Perfection Certificate, provide written notice of the same to Agent. 

 

	9.3	Mergers or Acquisitions 

 Permit any of its Subsidiaries to merge or consolidate, with
any other Person, or acquire, or permit any of its Subsidiaries to acquire, all or substantially all of the share capital or property of another Person. A Subsidiary of an Obligor may merge or consolidate into another Subsidiary of such Obligor or
into such Obligor. 
  

	9.4	Indebtedness 

 Create, incur, assume, or be liable for any Indebtedness, or permit any of
its Subsidiaries to do so, other than the Permitted Indebtedness. 
  

	9.5	Guarantees or indemnities 

 Except in accordance with Clause 12 (Guarantee and
Indemnity), no Obligor shall incur or allow to remain outstanding any guarantee in respect of any obligation of any person, commit itself as joint and several debtor for such obligations or bind itself as a surety for such obligations, except in
each case in respect of Permitted Guarantees. 
  

	9.6	Encumbrance 

 Create, incur, allow, or suffer any Lien on any of, the Collateral and/or
its Intellectual Property, or assign or convey any right to receive income, including the sale of any Accounts, or permit any of its Subsidiaries to do so, except for Permitted Liens, permit any Collateral not to be subject to the first priority
security interest granted by the Security Documents, except as is otherwise permitted in Clause 9.1 (Dispositions) and the definition of “Permitted Liens”. 

  
 23 

	9.7	Distributions; Investments 

 Directly or indirectly acquire or own any Person, or make
any Investment in any Person, other than Permitted Investments, or permit any of its Subsidiaries to do so; or pay any dividends or make any distribution or payment or redeem, or purchase any of its share capital or give any financial assistance in
respect of the purchase of any of its share capital except in each case in respect of any long term incentive plans or employee and officer shares schemes in operation in respect of each Obligor. 

 

	9.8	Transactions with Affiliates 

 Directly or indirectly enter into or permit to exist any
material transaction with any Affiliate of an Obligor, except for transactions that are in the ordinary course of such Obligor’s business, upon fair and reasonable terms that are no less favourable to such Obligor than would be obtained in an
arm’s length transaction with a non- affiliated Person and transactions permitted pursuant to the terms of Clause 9.1 (Dispositions). 

 

	9.9	Convertible Loans 

  

	 	9.9.1	Make or permit any payment on any debts owing to the holder(s) of the Convertible Loans other than exclusively as permitted under the terms permitted by the Subordination Agreement (for the avoidance of doubt, this
provision shall not preclude any conversion of the Convertible Loans into equity in the Borrower). 

  

	 	9.9.2	Suffer or incur any breach of the Subordination Agreement. 

  

	9.10	Application of FATCA 

 Become a FATCA FFI or a US Tax Obligor. 

 

	10	EVENTS OF DEFAULT 

 Any one of the following shall constitute an event of default (an
“Event of Default”): 
  

	10.1	Payment Default 

  

	 	10.1.1	An Obligor fails to: 

  

	 	(a)	make any payment of principal or interest on any Credit Extension on its due date (unless its failure to pay is caused by administrative or technical error and payment is made within three (3) Business Days after
its due date); or 

  

	 	(b)	pay any other Obligations within three (3) Business Days after such Obligations are due and payable (which three (3) Business Day cure period shall not apply to payments due on the Final Repayment Date).

  
 24 

	 	10.1.2	During the cure period, the failure to make any payment specified under Clauses 10.1.1(a) or 10.1.1(b) is not an Event of Default (but no Credit Extension will be made during the cure period). 

 

	10.2	Covenant Default 

  

	 	10.2.1	An Obligor fails or neglects to perform any obligation in Clause 6 (Affirmative Covenants) or breaches any covenant in Clause 9 (Negative Covenants) provided that no Event of Default will occur under the following
obligations or covenants if the failure to comply or breach is capable of being remedied and is remedied within the period specified next to such obligation or covenant (such period commencing on the earlier of (a) the Agent giving notice to
such Obligor or the failure to comply or breach, and (b) such Obligor becoming aware of the failure to comply or breach): 

  

	 	(a)	Clause 6.1 (Government Compliance), Clause 6.2 (Financial Statements, Reports, Certificates) or Clause 6.3 (“Know your Customer” checks), Clause 6.5 (Insurance) – ten (10) Business Days;

  

	 	(b)	Clause 9.1 (Dispositions), Clause 9.2 (Changes in Business, Ownership, Management or Business Locations), Clause 9.4 (Indebtedness), Clause 9.5 (Guarantees or Indemnities), Clause 9.6 (Encumbrance), Clause 9.7
(Distributions), Clause 9.8 (Transactions with Affiliates), Clause 9.9 (Convertible Loans) – ten (10) Business Days each; 

  

	 	(c)	Clause 6.4 (Taxes; pensions) – five (5) Business Days; and 

  

	 	(d)	Clause 6.7 (Protection and Registration of Intellectual Property Rights) and Clause 6.7 (Clinical Trials) – thirty (30) Business Days. 

 

	 	10.2.2	An Obligor fails or neglects to perform, keep, or observe any other term, provision, condition, covenant or agreement contained in this Agreement or in any Loan Document to which it is a party or in any other present or
future agreement between such Obligor and Agent, and as to any default (other than those specified in this Clause 10) under such other term, provision, condition, covenant or agreement that can be cured, has failed to cure the default within fifteen
(15) days after the occurrence thereof (but no Credit Extensions shall be made during such cure period). 

  

	10.3	Material Adverse Change 

 A Material Adverse Change occurs. 

  
 25 

	10.4	Attachment 

 Any material portion of an Obligor’s or any of its Subsidiary’s
assets is attached, seized, levied on, or comes into possession of a trustee, receiver, creditor or encumbrancer and the attachment, seizure or levy is not removed in fifteen (15) days or is not discharged within twenty (20) days; (ii) the
service of proceedings upon such Obligor or any of its Subsidiaries seeking to attach, by trustee or similar process, any funds of such Obligor or any such Subsidiary on deposit with Finance Parties, or any entity under control of Finance Parties
(including any of their subsidiaries); (iii) such Obligor or any of its Subsidiaries is injuncted, restrained, or prevented by court order from conducting a material part of its business; (iv) a judgment or other claim becomes a lien on a
material portion of the assets of such Obligor or any of its Subsidiaries; or (v) a notice of lien, levy, or assessment is filed against such Obligor or any of its Subsidiaries assets by any government department or agency and not paid within
fifteen (15) days after such Obligor or any of its Subsidiaries receives such notice. These are not Events of Default if stayed or if a bond is posted pending appeal by an Obligor or its Subsidiary (as appropriate) (but no Credit Extensions
shall be made during the grace period). 
  

	10.5	Insolvency and Insolvency Proceedings 

  

	 	10.5.1	Any of the following occurs in respect of an Obligor (each of which is an “Insolvency Proceeding”) 

  

	 	(a)	any order shall be made by any competent court, a petition presented (other than a petition that in the reasonable opinion of the Lenders is frivolous or vexatious) or any resolution shall be passed by any Obligor for
the appointment of a liquidator, administrator or receiver of, or for the winding up of, any Obligor or a moratorium is imposed or declared over any or all of the assets and business of any Obligor; or 

 

	 	(b)	an encumbrancer takes possession of or a receiver, liquidator, supervisor, compulsory manager, trustee, administrator or similar official is appointed over the whole or, in the reasonable opinion of the Agent, any
material part of, the assets of any Obligor or a distress, execution or other process is levied or enforced upon or sued out against the whole or, in the reasonable opinion of the Agent, a material part of the assets of any Obligor; or

  

	 	(c)	an administration application is presented or made for the making of an administration order or a notice of intention to appoint an administrator under Schedule B1 to the Insolvency Act 1986 is issued by any Obligor or
its directors or by the holder of a qualifying floating charge (as defined in such Schedule) or a notice of appointment of an administrator is filed by any person with the court; or 

  
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	 	(d)	any judgment made against any Obligor is not paid, stayed or discharged within 15 days; or 

  

	 	(e)	any Obligor shall stop payment or shall be unable to, or shall admit inability to, pay its debts as they fall due, or shall be adjudicated or found bankrupt or insolvent, or shall enter into any composition or other
arrangement with its creditors generally; or 

  

	 	(f)	any event shall occur which under the law of any jurisdiction to which any Obligor is subject has an effect equivalent or similar to any of the events referred to in this Clause 10.5; or 

 

	 	(g)	any Obligor ceases, threatens to cease, or suspends carrying on its business or a part of its business. 

  

	10.6	Other Agreements 

 There is, under any agreement to which an Obligor is a party with a
third party or parties, (a) any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any Indebtedness in an amount individually or in the aggregate in excess of Two Hundred
Thousand Pounds (£200,000); or (b) any default by an Obligor, the result of which could be materially detrimental to Borrower’s business. 
  

	10.7	Judgments 

 If a judgment, arbitration award, order or decree for the payment of money
and that is no longer subject to an appeal process in an amount, individually or in the aggregate, of at least One Hundred Thousand Pounds (£100,000) (or its equivalent in any other currency) shall be rendered against an Obligor or any of its
Subsidiaries and shall remain unsatisfied or unstayed for a period of fifteen (15) days of it being made (provided that no Credit Extensions will be made prior to the satisfaction or stay of such judgment, order or decree). 

 

	10.8	Misrepresentations 

 If any representation or warranty or statement in writing made or
deemed to be made or repeated by an Obligor or any Person acting for such Obligor in, or in connection with the negotiation of, any Loan Document or in any notice, certificate or statement of fact referred to in or delivered under any Loan Document
or in any other written material delivered to Finance Parties is or shall prove to be untrue or incorrect in any material respect or misleading when made or deemed to be made or repeated under such Loan Document. 

 

	10.9	Convertible Loans 

 Any document, instrument, or agreement evidencing any Convertible
Loans, including the Subordination Agreement, shall for any reason be revoked or 

  
 27 

 
invalidated or otherwise cease to be in full force and effect (otherwise than in circumstances permitted by the Loan Documents), any Person shall be in breach thereof or contest in any manner the
validity or enforceability thereof or deny that it has any further liability or obligation thereunder, or the Obligations shall for any reason be subordinated or shall not have the priority contemplated by this Agreement. 

 

	10.10	Other Agreements with Finance Parties 

 An Obligor, or any of its Subsidiaries fails to
perform any of its financial obligations or other material obligations under any agreement between such Obligor, or any of its Subsidiaries and Finance Parties or any of its Affiliates and any applicable grace period in relation to the foregoing has
expired. 
  

	10.11	Governmental Approvals 

 Any Governmental Approval shall have been (a) revoked,
rescinded, suspended, modified in an adverse manner or not renewed in the ordinary course for a full term or (b) subject to any decision by a Governmental Authority that designates a hearing with respect to any applications for renewal of any
of such Governmental Approval or that could result in the Governmental Authority taking any of the actions described in (a) above, and such decision or such revocation, rescission, suspension, modification or non-renewal (i) is, or could
reasonably be expected to be, a Material Adverse Change, or (ii) adversely affects the legal qualifications of an Obligor or any of its Subsidiaries/Affiliates to hold such Governmental Approval in any applicable jurisdiction and such
revocation, rescission, suspension, modification or non-renewal could reasonably be expected to affect the status of or legal qualifications of such Obligor or any of its Subsidiaries/Affiliates to hold any Governmental Approval in any other
jurisdiction. 
  

	10.12	Repudiation 

 An Obligor repudiates any of the Loan Documents or does or causes to be
done any act or thing evidencing an intention to repudiate any of the Loan Documents. 
  

	11	FINANCE PARTIES RIGHTS, REMEDIES AND OBLIGATION 

  

	11.1	When an Event of Default occurs and continues, the Agent (on instructions from the Lenders) may, without notice or demand, do any or all of the following: 

 

	 	11.1.1	declare all Obligations immediately due and payable (but if an Event of Default described in Clause 10.5 (Insolvency and Insolvency Proceedings) occurs all Obligations are immediately due and payable without any action
by the Agent); 

  

	 	11.1.2	stop advancing money or extending credit for the benefit of the Borrower under this Agreement or under any other agreement between an Obligor and the Finance Parties; 

  
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	 	11.1.3	settle or adjust disputes and claims directly with Account Debtors for amounts, on terms and in any order that the Agent considers advisable and notify any person owing the Obligors money of the Security Agent’s
Security Interest in such funds and verify and/or collect the amounts owed by such Account Debtors. During the occurrence of an Event of Default that is continuing, any amounts received by any Obligor shall be held in trust by such Obligor for the
Finance Parties, and, if requested by the Agent, the Obligor shall immediately deliver such receipts to the Agent in the form received from the Account Debtor, with proper endorsements for deposit; 

 

	 	11.1.4	make any payments and do any acts it considers necessary or reasonable to protect its Security Interest in the Collateral. Each Obligor shall assemble the Collateral if the Agent requests and make it available as the
Agent designates in accordance with the relevant provisions of the Security Documents, Intercreditor Agreement and/or Agency and Security Trust Deed (as the case may be). The Security Agent may enter premises where the Collateral is located, and, to
the fullest extent permitted under applicable law take and maintain possession of any part of the Collateral, pay, purchase, contest, or compromise any Security Interest which appears to be prior or superior to its Security Interest and pay all
expenses incurred. Each Obligor grants the Security Agent a licence to enter and occupy any of its premises, without charge, to exercise any of the Security Agent’s rights or remedies during an Event of Default that is continuing;

  

	 	11.1.5	apply towards the discharge of the Obligations any: 

  

	 	(a)	balances and deposits of any Obligor it holds; or 

  

	 	(b)	any amount held by any Finance Party owing to or for the credit or the account of any Obligor; 

  

	 	11.1.6	ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell the Collateral. Each Obligor grants in favour of the Security Agent a non-exclusive, royalty-free licence or other
right to use, without charge, such Obligor’s labels, Patents, Copyrights, rights of use of any name, trade secrets, trade names, Trademarks, service marks, and advertising matter, or any similar property as it pertains to the Collateral, in
completing production of, advertising for sale, and selling any Collateral and, in connection with the Security Agent’s exercise of its rights under this Clause 11 such Obligor’s rights under all licences and all franchise agreements inure
to the Security Agent’s benefit; 

  

	 	11.1.7	deliver a notice of exclusive control, any entitlement order, or other directions or instructions pursuant to any control agreement or similar agreements providing control of any Collateral; 

 

	 	11.1.8	demand and receive possession of each Obligor’s Books; and 

  
 29 

	 	11.1.9	exercise any rights and remedies available to the Finance Parties under the Security Documents or applicable law. 

  

	11.2	Power of Attorney 

 Each Obligor, as security for the discharge of the Obligations,
hereby irrevocably appoints Security Agent as its lawful attorney-in-fact, exercisable upon the occurrence and during the continuance of an Event of Default, to: (a) endorse such Obligor’s name on any cheques or other forms of payment or
security; (b) sign such Obligor’s name on any invoice or bill of lading for any Account or drafts against Account Debtors; (c) settle and adjust disputes and claims about the Accounts directly with Account Debtors, for amounts and on
terms Security Agent determines reasonable; (d) make, settle, and adjust all claims under such Obligor’s insurance policies; (e) pay, contest or settle any Lien, charge, encumbrance, security interest, and adverse claim in or to the
Collateral, or any judgment based thereon, or otherwise take any action to terminate or discharge the same; and (f) at any time after the security becomes enforceable, transfer the Collateral into the name of Security Agent or a third party.
Each Obligor hereby appoints Security Agent as its lawful attorney-in-fact to sign such Obligor’s name on any deeds or documents necessary to perfect or continue the perfection of Security Agent’s security interest in the Collateral (to
the extent contemplated by the Loan Agreements) regardless of whether an Event of Default has occurred until all Obligations have been satisfied in full and Security Agent is under no further obligation to make Credit Extensions hereunder. Security
Agent foregoing appointment as each Obligor’s attorney-in-fact, and all of Security Agent rights and powers, coupled with an interest, are irrevocable until all Obligations have been fully repaid and performed and Security Agent obligation to
provide Credit Extensions terminates. 
  

	11.3	Protective Payments 

 If an Obligor fails to obtain the insurance called for by Clause
6.5 (Insurance) or fails to pay any premium thereon, Agent may obtain such insurance or make such payment, and all amounts so paid by Agent are Lender Expenses and promptly and without delay due and payable, and secured by the Collateral. Agent will
make reasonable efforts to promptly and without delay provide any Obligor with notice of Agent obtaining such insurance at the time it is obtained or within a reasonable time thereafter. No payments by Agent are deemed an agreement to make similar
payments in the future or Agent’s waiver of any Event of Default. 
  

	11.4	Lender Expenses 

 Any Lender Expenses are due and payable within ten (10) Business
Days of receipt by Borrower of a written notice been incurred by the Lenders in respect of this Agreement) and be secured by the Collateral. No payments by Agent shall be deemed an agreement to make similar payments in the future or Agent’s
waiver of any Event of Default. 

  
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	11.5	Remedies Cumulative 

 Agent’s failure, at any time or times, to require strict
performance by each Obligor of any provision of this Agreement or any other Loan Document shall not waive, affect, or diminish any right of Agent thereafter to demand strict performance and compliance herewith or therewith. No waiver hereunder shall
be effective unless signed by Agent and then is only effective for the specific instance and purpose for which it is given. Agent’s rights and remedies under this Agreement and the other Loan Documents are cumulative. Agent has all rights and
remedies provided by law, or in equity. Agent’s exercise of one right or remedy is not an election and Agent’s waiver of any Event of Default is not a continuing waiver. Agent’s delay in exercising any remedy is not a waiver,
election, or acquiescence. 
  

	11.6	Withholding; Gross-up 

  

	 	11.6.1	Definitions 

 In this Agreement: 

“Borrower DTTP Filing” means an HM Revenue & Customs’ Form DTTP2 duly completed and filed by the relevant
Borrower, which contains the scheme reference number and jurisdiction of tax residence stated in respect of that Lender in the documentation which it executes on becoming a Party as a Lender; and 

 

	 	(i)	where the Obligor is an Obligor as at the date on which that Treaty Lender becomes a Party as a Lender, is filed with HM Revenue & Customs within 30 days of that date; or 

 

	 	(ii)	where the Obligor is not an Obligor as at the date on which that Treaty Lender becomes a Party as a Lender, is filed with HM Revenue & Customs within 30 days of the date on which that Obligor becomes an
additional Obligor. 

 “Qualifying Lender” means: 

 

	 	(i)	a Lender which is beneficially entitled to interest payable to that Lender in respect of an advance under a Loan Document and is: 

  

	 	(A)	a Lender: 

  

	 	(1)	which is a bank (as defined for the purpose of section 879 of the ITA) making an advance under a Loan Document and is within the charge to United Kingdom corporation tax as respects any payments of interest made in
respect of that advance or would be within such charge as respects such payments apart from section 18A of the CTA; or 

  
 31 

	 	(2)	in respect of an advance made under a Loan Document by a person that was a bank (as defined for the purpose of section 879 of the ITA) at the time that that advance was made and within the charge to United Kingdom
corporation tax as respects any payments of interest made in respect of that advance; or 

  

	 	(B)	a Lender which is: 

  

	 	(1)	a company resident in the United Kingdom for United Kingdom tax purposes; or 

  

	 	(2)	a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing the
chargeable profits (within the meaning of section 19 of the CTA) of that company; or 

  

	 	(C)	a Treaty Lender. 

 “Tax Confirmation” means a confirmation by a Lender that
the person beneficially entitled to interest payable to that Lender in respect of an advance under a Loan Document is either: 
  

	 	(i)	a company resident in the United Kingdom for United Kingdom tax purposes; or 

  

	 	(ii)	a company not so resident in the United Kingdom which carries on a trade in the United Kingdom through a permanent establishment and which brings into account interest payable in respect of that advance in computing the
chargeable profits (within the meaning of section 19 of the CTA) of that company. 

 “Treaty Lender” means a
Lender which: 
  

	 	(i)	is treated as a resident of a Treaty State for the purposes of the Treaty; and 

  

	 	(ii)	does not carry on a business in the United Kingdom through a permanent establishment with which that Lender’s participation in the Loan is effectively connected. 

  
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 “Treaty State” means a jurisdiction having a double taxation agreement (a
“Treaty”) with the United Kingdom which makes provision for full exemption from tax imposed by the United Kingdom on interest. 
  

	 	11.6.2	All payments to be made by the Obligors under the Loan Documents, whether in respect of principal, interest, fees or otherwise, shall (save insofar as required by law to the contrary) be paid in full without set-off or
counterclaim and free and clear of and without any deduction or withholding or payment for or on account of any Taxes (other than a FATCA Deduction) that may be imposed in the United Kingdom or any other jurisdiction (a “Tax
Deduction”) from which payment may be made by the Borrower under this Agreement. If any Obligor is required by law to effect Tax Deduction from or in connection with any payment made under this Agreement for the account of a Finance Party
then: 

  

	 	(a)	such Obligor shall promptly notify the Finance Party upon becoming aware of the relevant requirements to deduct any such Tax Deduction; 

 

	 	(b)	such Obligor shall ensure that such Tax Deduction does not exceed the minimum legal liability therefor, shall remit the amount of such Tax to the appropriate Taxation authority and shall forthwith pay to the Agent such
additional amount as will result in the immediate receipt by the Finance Party of the full amount which would otherwise have been receivable under this Agreement had no such Tax Deduction been made; and 

 

	 	(c)	such Obligor shall not later than fifty (50) days after each Tax Deduction forward to the Finance Party documentary evidence reasonably required by the Finance Party in respect of the payment of any such Taxes.

  

	 	11.6.3	A payment shall not be increased under Clause 11.6.2 above by reason of a Tax Deduction on account of Tax imposed by the United Kingdom, if on the date on which the payment falls due: 

 

	 	(a)	the payment could have been made to the relevant Lender without a Tax Deduction if the Lender had been a Qualifying Lender, but on that date that Lender is not or has ceased to be a Qualifying Lender other than as a
result of any change after the date it became a Lender under this Agreement in (or in the interpretation, administration, or application of) any law or treaty or any published practice or published concession of any relevant taxing authority; or

  
 33 

	 	(b)	the relevant Lender is a Qualifying Lender solely by virtue of paragraph (i)(B) of the definition of Qualifying Lender and: 

  

	 	(i)	an officer of H.M. Revenue & Customs has given (and not revoked) a direction (a “Direction”) under section 931 of the ITA which relates to the payment and that Lender has received from the Obligor
making the payment or from the Company a certified copy of that Direction; and 

  

	 	(ii)	the payment could have been made to the Lender without any Tax Deduction if that Direction had not been made; or 

  

	 	(c)	the relevant Lender is a Qualifying Lender solely by virtue of paragraph (i)(B) of the definition of Qualifying Lender and: 

  

	 	(i)	the relevant Lender has not given a Tax Confirmation to the Company; and 

  

	 	(ii)	the payment could have been made to the Lender without any Tax Deduction if the Lender had given a Tax Confirmation to the Company, on the basis that the Tax Confirmation would have enabled the Company to have formed a
reasonable belief that the payment was an “excepted payment” for the purpose of section 930 of the ITA; or 

  

	 	(d)	the relevant Lender is a Treaty Lender and the Obligor making the payment is able to demonstrate that the payment could have been made to the Lender without the Tax Deduction had that Lender complied with its
obligations under Clauses 11.6.4 or 11.6.5 (as applicable) below. 

  

	 	11.6.4	

  

	 	(a)	Subject to Clause 11.6.4(b) below, a Treaty Lender and each Obligor which makes a payment to which that Treaty Lender is entitled shall co-operate in completing any procedural formalities necessary for that Obligor to
obtain authorisation to make that payment without a Tax Deduction. 

  

	 	(b)	a Treaty Lender which holds a passport under the HMRC DT Treaty Passport scheme, and which wishes that scheme to apply to this Agreement, shall confirm its scheme reference number and its jurisdiction of tax residence
in the documentation which it executes on becoming a Party as a Lender and, having done so, that Lender shall be under no obligation pursuant to Clause 11.6.4(a) above. 

  
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	 	11.6.5	If a Lender has confirmed its scheme reference number and its jurisdiction of tax residence in accordance with Clause 11.6.4(b) above and: 

 

	 	(a)	a Borrower making a payment to that Lender has not made a Borrower DTTP Filing in respect of that Lender; or 

  

	 	(b)	a Borrower making a payment to that Lender has made a Borrower DTTP Filing in respect of that Lender but: 

  

	 	(i)	that Borrower DTTP Filing has been rejected by HM Revenue & Customs; or 

  

	 	(ii)	HM Revenue & Customs has not given the Borrower authority to make payments to that Lender without a Tax Deduction within 60 days of the date of the Borrower DTTP Filing, 

and, in each case, the Borrower has notified that Lender in writing, that Lender and the Borrower shall co-operate in completing any
additional procedural formalities necessary for that Borrower to obtain authorisation to make that payment without a Tax Deduction. 
  

	 	11.6.6	If a Lender has not confirmed its scheme reference number and jurisdiction of tax residence in accordance with Clause 11.6.4(b) above, no Obligor shall make a Borrower DTTP Filing or file any other form relating to the
HMRC DT Treaty Passport scheme in respect of that Lender’s Commitment or its participation in any Loan unless the Lender otherwise agrees. 

  

	 	11.6.7	A Borrower shall, promptly on making a Borrower DTTP Filing, deliver a copy of that Borrower DTTP Filing to the Agent for delivery to the relevant Lender. 

 

	 	11.6.8	Kreos gives a Tax Confirmation to the Borrower by entering into this Agreement. 

  

	 	11.6.9	The Agent shall promptly notify the Obligors if there is any change in the position from that set out in the Tax Confirmation. 

  

	 	11.6.10	If any Finance Party receives the benefit of any credit, payments or reimbursement in respect of the payment of any amount by any Obligor under this Clause 11 it shall (to the extent that it can do so without prejudice
to the retention of such benefit) pay to such Obligor such part of that benefit as in its absolute discretion will leave it (after such payment) in no more or less favourable position than it would have been in if no Tax Payment had been required by
such Obligor. For these purposes a “Tax Payment” means an increase in a payment made by such Obligor to the Finance Party under Clause 11.6.2 (Withholding; gross up). 

  
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	 	11.6.11	Nothing in this Clause 11 requires any Finance Party to arrange its tax affairs in a particular way or to disclose any information regarding its tax affairs. 

 

	 	11.6.12	FATCA information 

  

	 	(a)	Subject to Clause 11.6.12(c) below, each party shall, within ten (10) Business Days of a reasonable request by another party: 

  

	 	(i)	confirm to that other party whether it is: 

  

	 	(A)	a FATCA Exempt Party; or 

  

	 	(B)	not a FATCA Exempt Party; and 

  

	 	(ii)	supply to that other party such forms, documentation and other information relating to its status under FATCA (including its applicable “pass thru payment percentage” or other information required under the
Treasury Regulations or other official guidance including inter-governmental agreements) as that other party reasonably requests for the purposes of that other party’s compliance with FATCA. 

 

	 	(b)	If a party confirms to another party pursuant to Clause 11.6.12(a)(i) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, that party shall
notify that other party reasonably promptly. 

  

	 	(c)	Clause 11.6.12(a) above shall not oblige the Finance Parties to do anything which would or might in its reasonable opinion constitute a breach of: 

 

	 	(i)	any law or regulation; 

  

	 	(ii)	any policy of the Finance Parties; 

  

	 	(iii)	any fiduciary duty; or 

  

	 	(iv)	any duty of confidentiality. 

  

	 	(d)	If a party fails to confirm its status or to supply forms, documentation or other information requested in accordance with Clause 11.6.12(a) above (including, for the avoidance of doubt, where Clause 11.6.12(c) above
applies), then: 

  

	 	(i)	if that party failed to confirm whether it is a FATCA Exempt Party, then such party shall be treated for the purposes of the Loan Documents as if it is not a FATCA Exempt Party; and 

  
 36 

	 	(ii)	if that party failed to confirm its applicable “pass thru payment percentage”, then such party shall be treated for the purposes of the Loan Documents (and payments made pursuant to the Loan Documents) as if
its applicable “pass thru payment percentage” is 100%, 

 until (in each case) such time as the party in question
provides the requested confirmation, forms, documentation or other information. 
  

	 	11.6.13	FATCA Deduction and gross up by Obligors 

  

	 	(a)	If an Obligor is required to make a FATCA Deduction, the Obligor shall make that FATCA Deduction and any payment required in connection with that FATCA Deduction within the time allowed and in the minimum amount
required by FATCA, and no Obligor shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction. 

 

	 	(b)	Each Obligor shall promptly upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of a FATCA Deduction) notify the Agent accordingly. 

 

	 	(c)	Within thirty (30) days of making either a FATCA Deduction or any payment required in connection with that FATCA Deduction, the Obligor making that FATCA Deduction shall deliver to the Agent evidence reasonably
satisfactory to the Agent that the FATCA Deduction has been made or (as applicable) any appropriate payment paid to the relevant governmental or taxation authority. 

 

	 	11.6.14	FATCA Deduction by the Finance Parties 

 A Finance Party may make any FATCA Deduction it
is required by FATCA to make together with any payment required in connection with that FATCA Deduction, and the relevant Finance Party shall not be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise
compensate the recipient of the payment for that FATCA Deduction. If a Finance Party becomes aware that it must make a FATCA Deduction in respect of a payment to another Party (or that there is any change in the rate or the basis of such FATCA
Deduction), it shall notify that Party. 

  
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	 	11.6.15	Tax credit and FATCA 

 If an Obligor makes a FATCA Payment and a Finance Party
determines that: 
  

	 	(a)	a credit against, relief or remission for, or repayment of any Tax is attributable to an increased payment of which that FATCA Payment forms part, to that FATCA Payment or to a FATCA Deduction in consequence of which
that FATCA Payment was required; and 

  

	 	(b)	the Finance Party has obtained, utilised and retained that credit, 

 the Finance Party shall
pay an amount to the Obligor which the Finance Party determines will leave it (after that payment) in the same position after Tax as it would have been in had the FATCA Payment not been required to be made by the Obligor. 

 

	11.7	Tax indemnity 

  

	 	11.7.1	On the later of ten (10) Business Days before the due date for payment of the relevant Tax and ten (10) Business Days after the date on which a Lender serves a demand on the Borrower requesting payment
pursuant to this Clause 11.7.1, the Borrower shall pay the Lender an amount equal to the loss, liability or cost which the Lender reasonably determines that it has directly or indirectly suffered or will directly or indirectly suffer in relation to
Tax in respect of amounts payable to it under a Loan Document. A Lender shall as soon as reasonably practicable notify the Borrower in writing as soon as it is aware that it may be reasonably likely to make a claim pursuant to the indemnity in this
Clause 11.7.1. In the event that, after receiving a demand for payment pursuant to this Clause 11.7.1, the Borrower, acting reasonably, believes that such claim is inaccurate or can be mitigated, the relevant Lender and the Borrower shall engage in
good faith discussions for a period not exceeding one month after the date of the Borrower’s receipt of the demand for payment, to seek to resolve such claim by mutual agreement and any timeframes for payment of Tax by the Borrower shall be
extended accordingly. If any such demand that is contested pursuant to the foregoing sentence is not resolved in such one month period, it shall constitute a Dispute and resolved pursuant to Clause 15. 

 

	 	11.7.2	Clause 11.7.1 shall not apply to: 

  

	 	(a)	any Tax assessed on the Lender under the law of the jurisdiction in which the Lender is incorporated or resident for tax purposes if that Tax is imposed on, or calculated by reference to, the net income, profits or
gains received or receivable (but not any sum deemed to be received or receivable) by the Lender; or 

  

	 	(b)	the extent that a loss, liability or cost is compensated for by an increased payment under Clause 11.6 (Withholding; Gross-up); 

  
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	 	(c)	would have been compensated for by an increased payment under Clause 11.6 (Withholding; Gross-up) but was not so compensated solely because Clause 11.6.3 applied; or 

 

	 	(d)	the extent a loss, liability or cost relates to a FATCA Deduction required to be made by any party. 

  

	 	11.7.3	If the Agent on behalf of the Lenders makes (or intends to make) a claim under Clause 11.7.1, it shall promptly notify the Borrower of the event which has caused (or will cause) that claim. 

 

	11.8	Stamp taxes 

 The Borrower shall pay and, within five (5) Business Days of demand,
indemnify the Agent on behalf of the Lender against any cost, loss or liability the Lender incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Loan Document. 

 

	11.9	Value Added Tax 

  

	 	11.9.1	All amounts payable by the Borrower to the Lender under a Loan Document, that (in whole or in part) constitute consideration for VAT purposes are deemed to be exclusive of VAT. Subject to Clause 11.9.2, if VAT is
chargeable on any supply made by the Lender to the Borrower under a Loan Document, the Borrower shall pay the Agent (in addition to, and at the same time as, paying the consideration) an amount equal to the amount of the VAT and the Lender shall
promptly provide an appropriate VAT invoice to the Borrower. 

  

	 	11.9.2	Where a Loan Document requires the Borrower to reimburse the Lender for any costs or expenses, the Borrower shall, at the same time, reimburse and indemnify the Agent on behalf of the Lenders against all VAT incurred by
the Lender in respect of those costs or expenses. The amount payable shall be the amount that the Lender reasonably determines is the amount that neither it, nor any other member of any group of which it is a member for VAT purposes, is entitled to
recover from the relevant tax authority in respect of the VAT. 

  

	11.10	Other indemnities 

  

	 	11.10.1	Each Obligor indemnifies, defends and holds each Finance Party and its directors, officers, employees, agents or any other person affiliated with or representing such Finance Party (each, an “Indemnified
Person”) harmless against: 

  

	 	(a)	all direct obligations, demands, claims, and liabilities (collectively, “Claims”) asserted by any other party in connection with the transactions contemplated by the Loan Documents including without
limitation, any cost, loss or liability arising as a result of clause 5 (Sharing among the Finance Parties) of the Agency and Security Trust Deed; 

  
 39 

	 	(b)	any payment made to the Agent or the Security Agent pursuant to clause 3.11 of the Agency and Security Trust Deed; and 

  

	 	(c)	all direct losses or bank expenses incurred, or paid by such Indemnified Person from, following, or consequential to transactions between the Finance Parties and such Obligors (including legal and audit fees and
expenses), except for Claims and/or losses directly caused by such Indemnified Person’s gross negligence or wilful misconduct. 

  

	11.11	Illegality 

 If it shall become unlawful for the Lenders to continue to fund or maintain
any Credit Extensions, or to perform its obligations hereunder, upon demand by Agent, the Obligors shall prepay the Credit Extensions in full with all accrued interest thereon and all other amounts payable by such Obligors hereunder. The Term Loan
Early Termination Fee shall not be payable by the Obligors where such illegality or unlawfulness arises as a result of an act or omission on the part of the Agent but, for the avoidance of doubt, the Term Loan Early Termination Fee shall be payable
by the Obligors where such illegality or unlawfulness arises as a result of any act or omission on such Obligor’s part. 
  

	11.12	Additional Costs 

  

	 	11.12.1	Borrower shall pay Agent, promptly after receipt of a written demand and suitable evidence of the cost having been incurred by Agent, from time to time such amounts as Agent may reasonably determine to be necessary to
compensate it for any costs incurred by Agent that Agent determines are directly attributable to its making or maintaining of any amount receivable by Agent hereunder in respect of any Credit Extensions relating thereto (such increases in costs and
reductions in amounts receivable being herein called “Additional Costs”), in each case resulting from any regulatory change which: 

  

	 	(a)	changes the basis of taxation of any amounts payable to Agent under this Agreement in respect of any Credit Extensions (other than changes which affect taxes measured by or imposed on the overall net income of Agent by
the jurisdiction in which Agent has its principal office); 

  

	 	(b)	imposes or modifies any reserve, special deposit or similar requirements relating to any extensions of credit or other assets of, or any deposits with, or other liabilities of Agent; or 

 

	 	(c)	imposes any other condition affecting this Agreement (or any of such extensions of credit or liabilities), 

  
 40 

 (each of the events specified at Clauses 11.12.1(a), 11.12.1(b) and 11.12.1(c) (except an event
attributable to the wilful breach by the Agent or any of its Affiliates of any law or regulation) being a “Regulatory Change”). 
  

	 	11.12.2	Agent will notify Borrower of any event occurring after the Closing Date which will entitle Agent to compensation pursuant to this Clause 11.12 (Additional Costs) as promptly as practicable after it obtains knowledge
thereof and determines to request such compensation. Agent will furnish Borrower with a statement setting out the basis and amount of each request by Agent for compensation under this Clause 11.12 (Additional Costs). Determinations and allocations
by Agent for purposes of this Clause 11.12 (Additional Costs) of the effect of any Regulatory Change on its costs of maintaining its obligations to make Credit Extensions, of making or maintaining Credit Extensions, or on amounts receivable by it in
respect of Credit Extensions, and of the additional amounts required to compensate Agent in respect of any Additional Costs, shall be conclusive in the absence of manifest error. 

 

	 	11.12.3	If Agent shall determine (acting reasonably) that the adoption or implementation of any applicable law, rule, regulation, or treaty regarding capital adequacy, or any change therein, or any change in the interpretation
or administration thereof by any governmental authority, central bank, or comparable agency charged with the interpretation or administration thereof, or compliance by Agent (or its applicable lending office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority, central bank, or comparable agency, has or would have the effect of reducing the rate of return on capital of Agent or any person or entity controlling Agent (a
“Parent”) as a consequence of its obligations hereunder to a level below that which Agent (or its Parent) could have achieved but for such adoption, change, or compliance (taking into consideration policies with respect to capital
adequacy) by an amount deemed by Agent to be material, then from time to time, within five (5) days after demand by Agent, Borrower shall pay to Agent such additional amount or amounts as will compensate Agent for such reduction. A statement of
Agent claiming compensation under this Clause 11.12 (Additional Costs) and setting out the additional amount or amounts to be paid to it hereunder shall be conclusive absent manifest error. 

 

	11.13	Indemnity to the Agent 

  

	 	11.13.1	The Borrower shall promptly indemnify the Agent against: 

  

	 	(a)	any cost, loss or liability incurred by the Agent (acting reasonably) as a result of: 

  

	 	(i)	investigating any event which it reasonably believes is an Event of Default; 

  
 41 

	 	(ii)	acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised; or 

 

	 	(iii)	instructing lawyers, accountants, tax advisers, surveyors or other professional advisers or experts as permitted under this Loan Agreement; and 

 

	 	(b)	any reasonable cost, loss or liability (including, without limitation, for negligence or any other category of liability whatsoever) incurred by the Agent (otherwise than by reason of the Agent’s gross negligence
or wilful misconduct) in acting as Agent under the Loan Documents. 

  

	11.14	Indemnity to the Security Agent 

  

	 	11.14.1	Each Obligor jointly and severally shall promptly indemnify the Security Agent and every Receiver against any reasonable cost, loss or liability incurred by any of them as a result of: 

 

	 	(a)	any failure by the Borrower to comply with its obligations under Clause 2.10.2 (Lenders Expenses) and Clause 11.4 (Lenders Expenses); 

 

	 	(b)	acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised; 

 

	 	(c)	the taking, holding, protection or enforcement of the Security Document; 

  

	 	(d)	the exercise of any of the rights, powers, discretions, authorities and remedies vested in the Security Agent and each Receiver by the Loan Documents or by law; 

 

	 	(e)	any default by any Obligor in the performance of any of the obligations expressed to be assumed by it in the Loan Documents; or 

  

	 	(f)	acting as Security Agent or Receiver under the Loan Documents or which otherwise relates to any of the Collateral (otherwise, in each case, than by reason of the relevant Security Agent’s or Receiver’s gross
negligence or wilful misconduct). 

  

	 	11.14.2	The Security Agent and every Receiver may, in priority to any payment to the Lenders and to the fullest extent permitted under applicable law, indemnify itself out of the Collateral in respect of, and pay and retain,
all sums necessary to give effect to the indemnity in this Clause 11.14 and shall have a lien on the Security Documents and the proceeds of the enforcement of the Security Documents for all moneys payable to it. 

  
 42 

	11.15	FINANCE PARTIES OBLIGATION 

  

	 	11.15.1	The Finance Parties each acknowledge that the Borrower is a company whose financial instruments are traded in a Multilateral Trading Facility and that information of the Group provided to them pursuant to the Loan
Documents may constitute inside information for the purposes of the Market Abuse Regulation (“MAR”) and other applicable legislation. Accordingly, each of the Finance Parties hereby irrevocably and unconditionally covenant with the
Obligors that: 

  

	 	(a)	such Finance Party will create and keep up to date a list of any individuals who have access to any information from the Group in respect of the Loan Documents (or disclosed to them in connection with the Loan
Documents) in the form provided to such Finance Party by the Borrower on or around the date of this Agreement or in such other form as may be reasonably agreed between the Borrower and the relevant Finance Party (such lists being “Finance Party
Insider Lists”); 

  

	 	(b)	such Finance Party shall promptly provide a copy of any Finance Party Insider List held by it to the Borrower or to the Financial Conduct Authority upon request in writing by either of the foregoing; 

 

	 	(c)	such Finance Party shall retain all copies of any Finance Party Insider Lists held by it for not less than five (5) years after the expiration of any obligations owed by the Obligors to the Finance Parties pursuant
to the Loan Documents; 

  

	 	(d)	such Finance Party shall take reasonable measures to ensure that any person named on a list is aware of the sanctions that may apply for any misuse or unauthorised distribution of any inside information held by them in
respect of any members of the Group; and 

  

	 	(e)	such Finance Party shall take all measures necessary or desirable within its control to ensure that it is in compliance with the requirements of MAR and any similar applicable legislation in relation to such inside
information provided to it pursuant to the Loan Documents. 

  

	12	GUARANTEE AND INDEMNITY 

  

	12.1	Each Guarantor irrevocably and unconditionally: 

  

	 	12.1.1	guarantees to the Finance Parties punctual performance by the Borrower of all such Borrower’s obligations under the Loan Documents; 

  
 43 

	 	12.1.2	undertakes with the Finance Parties that whenever the Borrower does not pay any amount when due under or in connection with any Loan Document and after any applicable grace period has expired, that Guarantor shall
promptly and without delay on demand pay that amount as if it was the principal obligor; and 

  

	 	12.1.3	agrees with the Finance Parties that if any obligation guaranteed by it is or becomes unenforceable, invalid or illegal, it will, as an independent and primary obligation, indemnify the Finance Parties promptly and
without delay on demand against any cost, loss or liability it incurs as a result of the Borrower not paying any amount which would, but for such unenforceability, invalidity or illegality, have been payable by it under any Loan Document on the date
when it would have been due. The amount payable by the Guarantor under this indemnity will not exceed the amount it would have had to pay under this Clause 12 if the amount claimed had been recoverable on the basis of a guarantee. 

 

	12.2	This guarantee is a continuing guarantee and will extend to the ultimate balance of sums payable by the Borrower under the Loan Documents, regardless of any intermediate payment or discharge in whole or in part.

  

	12.3	If any discharge, release or arrangement (whether in respect of the obligations of the Borrower or any security for those obligations or otherwise) is made by the Agent in whole or in part on the basis of any payment,
security or other disposition which is avoided or must be restored in insolvency, liquidation, administration or otherwise, without limitation, then the liability of each Guarantor under this Clause 12 will continue or be reinstated as if the
discharge, release or arrangement had not occurred. 

  

	12.4	The obligations of each Guarantor under this Clause 12 will not be affected by an act, omission, matter or thing which, but for this Clause 12, would reduce, release or prejudice any of its obligations under this Clause
12 (without limitation and whether or not known to it or the Finance Parties) including: 

  

	 	12.4.1	any time, waiver or consent granted to, or composition with, the Borrower or other person; 

  

	 	12.4.2	the release of the Borrower or any other person under the terms of any composition or arrangement with any creditor of the Borrower; 

 

	 	12.4.3	the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, take up or enforce, any rights against, or security over assets of, the Borrower or other person or any non-
presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security; 

  
 44 

	 	12.4.4	any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of the Borrower or any other person; 

 

	 	12.4.5	any amendment, novation, supplement, extension, restatement (however fundamental and whether or not more onerous) or replacement of any Loan Document or any other document or security including without limitation any
change in the purpose of, any extension of or any increase in any facility or the addition of any new facility under any Loan Document or other document or security; 

 

	 	12.4.6	any unenforceability, illegality or invalidity of any obligation of any person under any Loan Document or any other document or security; or 

 

	 	12.4.7	any insolvency or similar proceedings. 

  

	12.5	Without prejudice to the generality of this Clause 12, each Guarantor expressly confirms that it intends that this guarantee shall extend from time to time to any (however fundamental) variation, increase, extension or
addition of or to any of the Loan Documents and/or any facility or amount made available under any of the Loan Documents for the purposes of or in connection with any of the following: business acquisitions of any nature; increasing working capital;
enabling investor distributions to be made; carrying out restructurings; refinancing existing facilities; refinancing any other indebtedness; making facilities available to new borrowers; any other variation or extension of the purposes for which
any such facility or amount might be made available from time to time; and any fees, costs and/or expenses associated with any of the foregoing. 

  

	12.6	Each Guarantor waives any right it may have of first requiring any Finance Party (or any trustee or agent on its behalf) to proceed against or enforce any other rights or security or claim payment from any person before
claiming from each Guarantor under this Clause 12 provided the Borrower is in breach of the Obligations and any applicable grace period has been exhausted. This waiver applies irrespective of any law or any provision of a Loan Document to the
contrary. 

  

	12.7	Unless: 

  

	 	12.7.1	all amounts which may be or become payable by the Borrower under the Loan Documents have been irrevocably paid in full; or 

  

	 	12.7.2	the Agent otherwise directs, 

  
 45 

 each Guarantor shall not, after a claim has been made or by virtue of any payment by it under
this Clause 12: 
  

	 	(a)	present claims for the creditor’s meeting to the bankruptcy trustee or administrator of, or vote as a creditor of the Borrower that is bankrupt in competition with the Finance Parties; or 

 

	 	(b)	receive, claim or have the benefit of any payment from or on account of the Borrower, or exercise any right of set-off against the Borrower. 

 

	12.8	Until all amounts which may be or become payable by the Borrower under or in connection with the Loan Documents have been irrevocably paid in full and unless the Agent otherwise directs, each Guarantor will not exercise
any rights which it may have by reason of performance by it of its obligations under the Loan Documents or by reason of any amount being payable, or liability arising, under this Clause 12: 

 

	 	12.8.1	to be indemnified by the Borrower; 

  

	 	12.8.2	to claim any contribution from any other guarantor of the Borrower’s obligations under the Loan Documents; 

  

	 	12.8.3	to take the benefit (in whole or in part and whether by way of subrogation or otherwise) of any rights of the Finance Parties under the Loan Documents or of any other guarantee or security taken pursuant to, or in
connection with, the Loan Documents by any Finance Party; 

  

	 	12.8.4	to bring legal or other proceedings for an order requiring the Borrower to make any payment, or perform any obligation, in respect of which such Guarantor has given a guarantee, undertaking or indemnity under Clause
12.1; 

  

	 	12.8.5	to exercise any right of set-off against the Borrower; and/or 

  

	 	12.8.6	to claim or prove as a creditor of the Borrower in competition with the Finance Parties. 

  

	 	12.8.7	If the Borrower receives any benefit, payment or distribution in relation to such rights it shall hold that benefit, payment or distribution to the extent necessary to enable all amounts which may be or become payable
to the Finance Parties by the Obligors under or in connection with the Loan Documents to be repaid in full on trust for the Finance Parties and shall promptly pay or transfer the same to the Agent or as the Agent may direct for application.

  

	12.9	This guarantee is in addition to and is not in any way prejudiced by any other guarantee or security now or subsequently held by the Finance Parties. 

 

	12.10	This guarantee does not apply to any liability to the extent that it would result in this guarantee constituting unlawful financial assistance. 

  
 46 

	13	NOTICES 

 All notices, consents, requests, approvals, demands, or other communication by
any party to this Agreement or any other Loan Document must be in writing and shall be deemed to have been validly served, given, or delivered: (a) upon the earlier of actual receipt and five (5) Business Days after deposit in the mail,
first class, registered or certified mail return receipt requested, with proper postage prepaid; (b) upon transmission, when sent by electronic mail or facsimile transmission; (c) one (1) Business Day after deposit with a reputable
overnight courier with all charges prepaid; or (d) when delivered, if hand-delivered by messenger, all of which shall be addressed to the party to be notified and sent to the address, facsimile number, or email address indicated below. Finance
Parties or Borrower may change their mailing or electronic mail address or facsimile number by giving the other party written notice thereof in accordance with the terms of this Clause 13 (Notices). 

If to Borrower: 
 Mereo
BioPharma Group plc 
 4th Floor, 

1 Cavendish Place, 
 London W1G
0QF 
 Attn: General Counsel 

Email: legal@mereobiopharma.com 

If to the Guarantors (on behalf of all of them): 

Mereo Biopharma 1 Limited 
 4th
Floor, 
 1 Cavendish Place, 

London W1G 0QF 
 Attn: General
Counsel 
 Email: legal@mereobiopharma.com 

with a copy to: 

Covington & Burling LLP 

265 Strand 
 London, WC2R 1BH 

Attn: James Gubbins 
 Email:
jgubbins@cov.com 

  
 47 

 If to Silicon Valley Bank (as Lender): 

Silicon Valley Bank 
 Alphabeta

 14-18 Finsbury Square 

London EC2A 1BR 
 Attn: Jim Watts

 Fax: +44(0)207 600 9556 

Email: JWatts2@svb.com 
 with a
copy to: 
 Charles Russell Speechlys LLP 

5 Fleet Place 
 London EC4M 7RD

 Fax: +44 (0)207 427 6600 

Attn: Chris Putt 
 If to Kreos
Capital V (UK) Limited (as Lender, Agent, Security Agent): 
 25-28 Old Burlington Street 

London 
 W1S 3AN 

Fax: +44 (0)207 409 1034 

Attention: Jack Diamond 
 with a
copy to: 
 Charles Russell Speechlys LLP 

5 Fleet Place 
 London EC4M 7RD

 Fax: +44 (0)207 427 6600 

Attn: Chris Putt 
  

	14	AGENCY AND SECURITY TRUST DEED 

 The terms of the Agency and Security Trust Deed shall be
deemed to be incorporated in this Agreement as though set out in full in this Agreement, with any reference to “this Deed” being deemed to be a reference to “this Agreement”, subject to any necessary changes. 

 

	15	CHOICE OF LAW AND JURISDICTION 

  

	15.1	This Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law. 

  
 48 

	15.2	The courts of England have exclusive jurisdiction to settle any dispute (a “Dispute”) arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or
termination of this Agreement or any non-contractual obligations arising out of or in connection with this Agreement). It is agreed that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party
will argue to the contrary. 

  

	15.3	This Clause 15 (Choice of Law and Jurisdiction) is for the benefit of the Finance Parties only. As a result, the Finance Parties shall not be prevented from taking proceedings relating to a Dispute in any other courts
with jurisdiction. To the extent allowed by law, the Finance Parties may take concurrent proceedings in any number of jurisdictions. 

  

	16	GENERAL PROVISIONS 

  

	16.1	Changes to the Parties 

  

	 	16.1.1	This Agreement binds and is for the benefit of the successors and permitted assigns of each party. 

  

	 	16.1.2	No Borrower may assign any of its rights or transfer any of its rights or obligations under the Loan Documents without the Agent’s prior written consent (which may be granted or withheld in the Agent’s sole
discretion). 

  

	 	16.1.3	The Finance Parties have the right, with prior written notice, but without the consent of the Borrower, to sell, transfer, assign, negotiate, or grant participation in all or any part of, or any interest in, their
obligations, rights and benefits under any Loan Document to a Permitted Transferee. Notwithstanding any other provisions of this Agreement, no transfer shall be made to any person which is a Competitor of the Borrower or any other Group Company.

  

	 	16.1.4	In the case of any assignments under any Loan Documents, the Obligors shall only be required to make any additional payments under Clause 11.6.2 (Withholding; Gross-up) to the same extent as would have been the case if
the sale, transfer, assignment, negotiation or participation had not occurred. This Clause 16.1.4 shall not apply to a Treaty Lender that has included a confirmation of its scheme reference number and its jurisdiction of tax residence in accordance
with Clause 11.6.4(b) if the Obligor has not made a Borrower DTTP Filing in respect of that Treaty Lender. 

  

	 	16.1.5	An assignment or transfer of part of the Kreos Commitment or the SVB Commitment or part of its rights and obligations under this Agreement by a Lender must be in a minimum amount of One Hundred Thousand Pounds
(£100,000) or multiples thereof. 

  
 49 

	16.2	Accession of Borrowers 

  

	 	16.2.1	The Agent may request that any of the Borrower’s Subsidiaries becomes a Borrower and/or a Guarantor. Upon such request from the Agent, the Subsidiary and the Borrower shall within thirty (30) days of such
request provide the Agent with: 

  

	 	(a)	a duly completed and executed Accession Deed; 

  

	 	(b)	if the relevant Subsidiary is incorporated in a jurisdiction different to the existing Obligors or if otherwise required, an amendment to this Agreement setting out such additional matters as the Agent’s local
counsel may advise are required; and 

  

	 	(c)	such Security and other documents (including, but not limited to, opinions of counsel) and evidence as it may reasonably request (in form and substance similar to the items provided by the Obligors pursuant to Clause 3
(Conditions of Loans). 

  

	 	16.2.2	The Agent shall notify the Obligors promptly upon being satisfied that it has received all of the items listed in Clause 16.2.1. 

  

	16.3	Right of Set-Off 

  

	 	16.3.1	Each Obligor at any time whilst an Event of Default is continuing, authorises each Finance Party to apply (without prior notice) any credit balance (whether or not then due) to which such Obligor is at any time
beneficially entitled on any account at, any sum held to its order by and/or any liability or obligation (whether or not matured) of, any office of SVB in or towards satisfaction of any sum then due and payable by it to any Finance Party under the
Loan Documents and unpaid and, for that purpose, to convert one currency into another, provided that nothing in this Clause 16.3 shall create a charge. 

  

	 	16.3.2	The Finance Parties shall not be obliged to exercise any of their rights under this Clause 16, which shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other right
(including the benefit of the Loan Documents) to which it is at any time otherwise entitled (whether by operation of law, contract or otherwise). 

  

	16.4	Sanctions 

 Each Obligor undertakes to the Agent that it is not: 

 

	 	16.4.1	a Restricted Party and is not engaging in any transaction or conduct that could be reasonably expected to result in it becoming a Restricted Party; 

 

	 	16.4.2	subject to any claim, proceeding, formal notice or investigation with respect to Sanctions; 

  
 50 

	 	16.4.3	is engaging in any transaction that evades or avoids, or has the purpose of evading or avoiding, or breaches or attempts to breach, directly or indirectly, any Sanctions applicable to it; or 

 

	 	16.4.4	is engaging, directly or indirectly, in any trade, business or other activities with or for the benefit of a Restricted Party. 

  

	16.5	Severability of Provision 

 Each provision of this Agreement is severable from every
other provision in determining the enforceability of any provision. 
  

	16.6	Correction of Loan Documents 

 Agent may complete any blanks in the Loan Documents
consistent with the agreement of the parties. 
  

	16.7	Amendments in Writing; Waiver; Integration 

 No purported amendment or modification of
any Loan Document, or waiver, discharge or termination of any obligation under any Loan Document, shall be enforceable or admissible unless, and only to the extent, expressly set out in writing signed by the party against which enforcement or
admission is sought. Without limiting the generality of the foregoing, no oral promise or statement, nor any action, inaction, delay, failure to require performance or course of conduct shall operate as, or evidence, an amendment, supplement or
waiver or have any other effect on any Loan Document. Any waiver granted shall be limited to the specific circumstance expressly described in it, and shall not apply to any subsequent or other circumstance, whether similar or dissimilar, or give
rise to, or evidence, any obligation or commitment to grant any further waiver. The Loan Documents represent the entire agreement about this subject matter and supersede prior negotiations or agreements. All prior agreements, understandings,
representations, warranties, and negotiations between the parties hereto about the subject matter of the Loan Documents shall cease to have effect from the date of this Agreement. 

 

	16.8	Counterparts 

 This Agreement may be executed in any number of counterparts and by
different parties on separate counterparts, each of which, when executed and delivered, are an original, and all taken together, constitute one Agreement. 
  

	16.9	Survival 

 All covenants, representations and warranties made in this Agreement continue
in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than obligations which, by their terms, are to survive the termination of this Agreement) have been paid in full and satisfied. The obligation of the
Obligors in Clause 11.10 (Other Indemnities) to indemnify Finance Parties shall survive until the statute of limitations with respect to such claim or cause of action shall have run. 

  
 51 

	16.10	Confidentiality 

  

	 	16.10.1	In handling any confidential information, the Finance Parties shall exercise the same degree of care that it exercises for their own proprietary information, but disclosure of information may be made: (a) to such
Finance Parties Subsidiaries or Affiliates; (b) to prospective transferees or purchasers of any interest in the Credit Extensions (provided, however, such Finance Party shall use its reasonable efforts to obtain any prospective
transferee’s or purchaser’s agreement to the terms of this provision); (c) as required by law, regulation, subpoena, or other order; (d) to such Finance Party regulators or as otherwise required in connection with such Finance Party
examination or audit; (e) as such Finance Party considers appropriate in exercising remedies under the Loan Documents; and (f) to third-party service providers of such Finance Party so long as such service providers have executed a
confidentiality agreement with the Finance Parties with terms no less restrictive than those contained herein. 

  

	 	16.10.2	Confidential information does not include information that is either: (i) in the public domain or in the Finance Parties possession when disclosed to the Finance Parties, or becomes part of the public domain after
disclosure to the Finance Parties; or (ii) disclosed to the Finance Parties by a third party if the Finance Parties do not know that the third party is prohibited from disclosing the information. 

 

	 	16.10.3	The Finance Parties may use confidential information for the development of databases, reporting purposes, and market analysis so long as such confidential information is aggregated and anonymised prior to distribution
unless otherwise expressly permitted by the Obligors. The provisions of the immediately preceding sentence shall survive the termination of this Agreement 

  

	16.11	Continuing obligations 

 All covenants, representations and warranties made in this
Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations which, by their terms, are to survive the termination of this
Agreement) have been satisfied. 
  

	16.12	Relationship 

 The relationship of the parties to this Agreement is determined solely by
the provisions of this Agreement. The parties hereto do not intend to create any agency, partnership, joint venture, trust, fiduciary or other relationship with duties or incidents different from those of parties to an arm’s-length contract.

  
 52 

	16.13	Third Party Rights 

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

	16.14	Calculations and certificates 

  

	 	16.14.1	Agent shall maintain accounts evidencing the amount the Obligors owe it, in accordance with its usual practice. The entries made in the accounts maintained by Agent are prima facie evidence of the Obligors’
obligations and amount owed to Agent. 

  

	 	16.14.2	Any certification or determination by Agent of a rate or amount under this Agreement is, in the absence of manifest error, conclusive evidence of the matters to which it relates. Each certificate or determination shall
contain reasonable details of the basis of determination. 

  

	17	DEFINITIONS 

  

	17.1	Definitions 

 In this Agreement: 

“Accession Deed” a deed relating to this Agreement, in the form set out at Exhibit D whereby any
third party entering into the Accession Deed shall become bound by the terms of this Agreement. 
 “Account Debtors” a
person or enterprise who owes money to the Borrower at any time. 
 “Accounts Date” is defined in Clause 5.4.1 (Financial
Statements; Financial Condition). 
 “Accounts” are all present and future book debts, accounts, accounts receivable,
contract rights, and other obligations owed to Borrower in connection with its sale or lease of goods (including licensing software and other technology) or provision of services, all credit insurance, guarantees, other security and all merchandise
returned or reclaimed by Borrower and Borrower’s Books relating to any of the foregoing, as such definition may be amended from time to time. 

“Additional Costs” is defined in Clause 11.12 (Additional Costs). 

“Advance Payment” means the T1 Advance Payment and the T2 Advance Payment, as the case may be. 

“Affiliate” is a Person that owns or controls directly or indirectly the Person, any Person that controls or is controlled by
or is under common control with the Person, including any Subsidiaries, and each of that Person’s senior executive officers, directors, partners and, for any Person that is a limited liability company, that Person’s managers and members.

  
 53 

 “Agency and Security Trust Deed” the deed dated on or about the Closing Date
between, among others, the Agent, the Security Agent and the Lenders in relation to this Agreement. 
 “Agreed Form” means
in relation to any document the form of that document specifically agreed by or on behalf of Borrower and Agent. 
 “Agreement”
means this loan agreement. 
 “Arrangement Fee” is defined in Clause 2.10.1 (Arrangement Fee). 

“Availability Period” means the T1 Availability Period and the T2 Availability Period, as the case may be; 

“Borrowers” the Borrower and any company that becomes a Borrower in accordance with Clause 16.2 (Accession of Obligors) and
“Borrower” means any one of them. 
 “Borrower Debenture” the debenture in respect of all assets and
undertaking of the Borrower in the Agreed Form. 
 “Business Day” is any day that is not a Saturday, Sunday, a day on which
either Lender is closed or a day on which leading banks are closed in the City of London, England and/or the State of California. 

“Business” means the research, development, production, trading and licensing of rights, Intellectual Property and/or products
within the life sciences industry (or any of the foregoing or any activities connected thereto). 
 “Change in Control”
means any event, transaction, or occurrence as a result of which any person (a) acquires directly or indirectly the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to (i) cast, or control the casting
of, more than 50% of the maximum number of votes that might be cast at a general meeting of the Borrower, or (ii) appoint or remove all, or the majority, of the members of the board of the Borrower; or (b) acquires directly or indirectly
the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to hold beneficially more than 50% of the issued share capital of either the Borrower. 

“Claims” is defined in Clause 11.10.1(a) (Other indemnities). 

“Clinical Trials Directive” is defined in Clause 6.7 (Clinical Trials). 

“Closing Date” means the date of satisfaction of all conditions to drawdown of Tranche 1 payment to Clause 3 (Conditions of
Loans) being in any event a date not later than twenty (20) Business Days from the signing of this Agreement. 

  
 54 

 “Closing” means closing of the transaction contemplated by this Agreement
pursuant to Clause 3 (Conditions of Loans). 
 “Code” the US Internal Revenue Code of 1986. 

“Collateral” is defined in Clause 4.1 (Security Documents). 

“Companies Act” the Companies Act 2006 as amended from time to time. 

“Competitor” means any entity (other than a reputable financial institution) whose business directly competes with the
Business carried out by the a Group Company; 
 “Compliance Certificate” means the certificate in the form of Exhibit
B to this Agreement. 
 “Contingent Obligation” is, for any Person, any direct or indirect liability, which
is dependent or contingent upon a future event including (i) any indebtedness, lease, dividend, letter of credit or other obligation of another such as an obligation directly or indirectly guaranteed, co-made, discounted or sold with recourse
by that Person, or for which that Person is directly or indirectly liable; (ii) any obligations for undrawn letters of credit for the account of that Person; and (iii) all obligations from any interest rate, currency or commodity swap
agreement, interest rate cap or collar agreement, or other agreement or arrangement designed to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices. The amount of a Contingent Obligation is the stated
or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum
of the obligations under any guarantee or other support arrangement. 
 “Convertible Loan” means the convertible loan
pursuant to the loan note instrument dated 3 June 2016 and subsequently amended on 4 May 2017 between the Borrower (as the issuer) and Novartis Pharma AG (as the noteholder). 

“Copyrights” are all copyright rights, applications or registrations and like protections in each work or authorship or
derivative work, whether published or not (whether or not it is a trade secret) now or later existing, created, acquired or held, including those described in the Perfection Certificate. 

“Credit Extension” is the Term Loan or any other extension of credit by Finance Parties for Borrower’s benefit under this
Agreement. “CTA” means the Corporation Tax Act 2009. 
 “Debentures” together the Borrower Debenture,
Guarantor 1 Debenture, Guarantor 2 Debenture and Guarantor 3 Debenture. 
 “Default Rate” is defined in Clause 2.9.2
(Default Rate). 

  
 55 

 “Delegate” any delegate, agent, attorney or co-trustee appointed by the Security
Agent. 
 “Deposit” is defined in Clause 2.10.2 (Lenders Expenses). 

“Dispute” is defined in Clause 15 (Choice of Law and Jurisdiction). 

“Drawdown Date” is the date on which either Tranche 1 or Tranche 2 is made; 

“Equipment” is all present and future machinery, equipment, tenant improvements, furniture, fixture vehicles (including motor
vehicles and trailers), tools, parts and attachments in which an Obligor has any interest. 
 “Event of Default” means any
of the events set out in Clause 10 (Events of Default). 
 “Facility” means the loan facility made available under this
Agreement. 
 “FATCA” means: 
  

	 	(a)	sections 1471 to 1474 of the Code or any associated regulations or other official guidance; 

  

	 	(b)	any treaty, law, regulation or other official guidance enacted in any other jurisdiction, or relating to an inter-governmental agreement between the US and any other jurisdiction, which (in either case) facilitates the
implementation of paragraph (a) above; or 

  

	 	(c)	any agreement pursuant to the implementation of paragraph (a) or (b) above with the IRS, the US government or any governmental or taxation authority in any other jurisdiction. 

“FATCA Deduction” means a deduction or withholding from a payment under a Loan Document required by FATCA. 

“FATCA Exempt Party” means a Party that is entitled to receive payments free from any FATCA Deduction. 

“FATCA FFI” a foreign financial institution as defined in section 1471(d)(4) of the Code which, if a Finance Party is not a
FATCA Exempt Party, could be required to make a FATCA Deduction. 
 “FATCA Payment” the increase in a payment made by an
Obligor to a Finance Party under Clause 11.6.13 (FATCA Deduction and gross up by Obligor). 
 “Final Payment” means seven
and a half per cent. (7.5%) of the total principal amount drawn by Borrower under the Facility payable on the Final Repayment Date or otherwise in accordance with Clause 2.8 (Final Payment). 

“Final Repayment Date” means 1 March 2021 in respect of Tranche 1 and 1 March 2021 in respect of Tranche 2. 

  
 56 

 “Finance Parties” means together the Lenders, the Agent and the Security Agent,
each of them being a “Finance Party”. 
 “Foreign Currency” means any lawful money that is not Sterling.

 “GAAP” is generally accepted accounting principles in the United Kingdom, including IFRS. 

“Governmental Approval” is any consent, authorisation, approval, order, licence, franchise, permit, certificate,
accreditation, registration, filing or notice, of, issued by, from or to, or other act by or in respect of, any Governmental Authority. 

“Governmental Authority” is any nation or government, any state or other political subdivision thereof, any agency, authority,
instrumentality, regulatory body, Regulatory Authority, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, any securities exchange and any
self-regulatory organisation. 
 “Group” means the Borrower and its Subsidiaries from time to time; 

“Guarantor 1” Mereo BioPharma 1 Limited, a company formed in England and Wales with CRO number 09646998 and registered office
at 4th Floor, One Cavendish Place, London, W1G 0QF, England. 
 “Guarantor 2” Mereo BioPharma 2 Limited, a company formed in
England and Wales with CRO number 09647035 and registered office at 4th Floor, One Cavendish Place, London, W1G 0QF, England. 

“Guarantor 3” Mereo BioPharma 3 Limited, a company formed in England and Wales with CRO number 09647034 and registered office
at 4th Floor, One Cavendish Place, London, W1G 0QF, England. 
 “Guarantors” Guarantor 1, Guarantor 2 and Guarantor 3 and
any person who guarantees the Obligations in accordance with Clause 12 (Guarantee and indemnity) and any Person who becomes a Guarantor in accordance with Clause 16.2 (Accession of Borrowers) and “Guarantor” means any one of them. 

“Guarantor 1 Debenture” a debenture in respect of all assets and undertaking of Guarantor 1 in the Agreed Form. 

“Guarantor 2 Debenture” a debenture in respect of all assets and undertaking of Guarantor 2 in the Agreed Form. 

“Guarantor 3 Debenture” a debenture in respect of all assets and undertaking of Guarantor 3 in the Agreed Form. 

“IFRS” are the International Financial Reporting Standards, a collection of guidelines and rules set by the International
Accounting Standards Board (www.iasb.org) which are applicable to the circumstances as of the date of determination. 

  
 57 

 “Indebtedness” is (a) indebtedness for borrowed money or the deferred price
of property or services, such as reimbursement and other obligations for surety bonds and letters of credit, (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations and
(d) Contingent Obligations of Borrower. 
 “Indemnified Person” is defined in Clause 11.10.1 (Other Indemnities). 

“Insolvency Proceeding” is defined in Clause 10.5 (Insolvency and Insolvency Proceedings). 

“Intellectual Property” means all of an Obligor’s present and future right, title, and interest in and to the following:

  

	 	(a)	its Copyrights, Trademarks and Patents; 

  

	 	(b)	any and all trade secrets and trade secret rights, including any rights to unpatented inventions, know-how and operating manuals; 

  

	 	(c)	any and all source codes; 

  

	 	(d)	any and all design rights which may be available to such Obligor; 

  

	 	(e)	any and all claims for damages by way of past, present and future infringement of any of the foregoing, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the
Intellectual Property rights identified above; and 

  

	 	(f)	all amendments, renewals and extensions of any of the Copyrights, Trademarks or Patents. 

“Intercreditor Agreement” the intercreditor agreement as between the Lenders dated on or about the Closing Date. 

“Interest Only Period” is defined in Clause 2.3.1 (Repayment of Term Loan). 

“Interest Payment Date” means the first day of each month. 

“Interim Payment” the payment in respect of interest accruing during the period from the Drawdown Date to the first Repayment
Date, being an amount calculated at a fixed annual interest rate of nine per cent. (9%), such amount accruing on a daily basis from the period from and including the Drawdown Date to first Repayment Date following the Drawdown Date; 

“Investment” is any beneficial ownership of stocks, shares, bonds and securities (including any partnership interest) in any
Person, or any loan, advance or capital contribution to any Person. 
 “IP Agreement” is that certain Intellectual Property
security confirmation agreement entered into by and between each Obligor and Agent dated on or around the date of this Agreement, as such may be amended from time to time. 

  
 58 

 “ITA” means the Income Tax Act 2007. 

“Kreos Commitment” means Five Million Pounds (£5,000,000) in respect of Tranche 1 and Five Million Pounds
(£5,000,000) in respect of Tranche 2. 
 “Lender Expenses” are (a) all audit fees and expenses and reasonable
costs and expenses (including reasonable legal fees and expenses) for preparing, negotiating, closing and administering, the Loan Documents or otherwise incurred with respect to Borrower (up to a maximum aggregate amount of £60,000 plus VAT in
respect of Tranche 1); and (b) all costs and expenses (including legal fees and expenses) for defending and enforcing the Loan Documents (including appeals or Insolvency Proceedings) or otherwise incurred with respect to any Obligor in each
case supported by a written invoice. 
 “Letter of Credit” is a standby or commercial letter of credit issued by Agent upon
request of an Obligor based upon an application, guarantee, indemnity or similar agreement. 
 “Lien” is a mortgage, lien,
deed of trust, levy, charge, assignment, pledge, security interest or other encumbrance. 
 “Loan Documents” are,
collectively, this Agreement, the Intercreditor Agreement, the Agency and Security Trust Deed, the Perfection Certificates, the Security Documents, and any loan, notes or guarantees executed by an Obligor in favour of Finance Parties, and any other
present or future agreement between an Obligor and/or for the benefit of Finance Parties in connection with this Agreement, all as amended, extended or restated. 

“Loan Payment/Advance Request Form” is that certain form attached hereto as Exhibit A. 

“Management Accounts Date” is defined in Clause 5.4.2 (Financial Statements; Financial Condition). 

“Material Adverse Change” is: (i) a material impairment in the perfection or priority of Security Agent’s security
interest in the Collateral or in the value of such Collateral; (ii) a material adverse change in the business, operations, or condition (financial or otherwise) of an Obligor; or (iii) a material impairment of the prospect of repayment of
any portion of the Obligations; 
 “Member of the same Fund Group” is if the shareholder is a fund, partnership, company,
syndicate or other entity whose business is managed by a Fund Manager (an “Investment Fund”) or a nominee of that person: 
  

	 	(a)	any participant or partner in or member of any such Investment Fund or the holders of any unit trust which is a participant or partner in or member of any Investment Fund but only in connection with the dissolution of
Investment Fund or any distribution of assets of the Investment Fund pursuant to the operation of the Investment Fund in the ordinary course of business, 

  
 59 

	 	(b)	any Investment Fund managed or exclusively advised by that Fund Manager, 

  

	 	(c)	a Parent Undertaking or Subsidiary Undertaking of that Investment Fund or Fund Manager, or any Subsidiary Undertaking of any Parent Undertaking of that Investment Fund or Fund Manager, or 

 

	 	(d)	any trustee, nominee or custodian of such Investment Fund and vice versa; 

 “Mereo
Guarantee Letter” means the letter as between the Borrower and the Guarantors dated on or around the date of this Agreement in connection with each Guarantor’s agreement to guarantee the Borrower’s performance of its obligations
under the Loan Documents. 
 “Monthly Financial Statements” is defined in Clause 6.2.1 (Monthly Financial Statements). 

“Monthly Repayments” is defined in Clause 2.3.2 (Repayment of Term Loan). 

“Novartis Acquisition Agreement” means the three asset purchase agreements dated 28 July 2015, between Novartis and each of
the Guarantors, respectively, and which relate to the purchase by each Guarantor of certain intellectual property rights from Novartis. 

“Novartis” means Novartis Pharma AG, a company incorporated and registered in Switzerland whose registered office is Postfach,
4002 Basel Switzerland; 
 “Obligations” are all present and future monies, liabilities, obligations, debts, principal,
interest, Lender Expenses and other amounts owing by an Obligor to any Secured Party, in each case whether actual or contingent (including, but without limitation, Contingent Obligations) and whether owing as principal or as surety or in any other
capacity or of any nature arising, in each of the foregoing cases, under or in connection with the Loan Documents, and including interest accruing after Insolvency Proceedings begin. 

“Obligor’s Books” means all of an Obligor’s books and records including ledgers, records regarding that
Obligor’s assets or liabilities, the Collateral, business operations or financial condition and all computer programs or discs or any equipment containing such information. 

“Obligors” means together, Borrower and Guarantors and “Obligor” means any one of them. 

“Parent” is defined in Clause 11.12.3 (Additional Costs). 

  
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 “Patents” are patents, including improvements, divisions, continuations,
renewals, reissues, extensions and continuations-in-part of the same, including as described in the Perfection Certificates and in each case owned by an Obligor. 

“Perfection Certificate” is defined in Clause 5.1 (Due Incorporation and Authorisation; Power and Authority) in respect of the
Borrower and the Guarantors and “Perfection Certificates” is all of them. 
 “Permitted Disposal” means: 

 

	 	(a)	any licencing or sale of the Intellectual Property in the ordinary course of business on an arm’s length basis, provided that the proceeds of such licensing or sale are used for the business of the Obligors, which
shall, for the avoidance of doubt, include repayment obligations in respect of the Term Loan; 

  

	 	(b)	any payment or disposal made in respect of Permitted Indebtedness, a Permitted Investment, a Permitted Lien, or a Permitted Guarantee; 

 

	 	(c)	any disposal of assets permitted by the Debenture relevant to the Obligor in question in exchange for cash or other assets comparable or superior as to type, value or quality, or a disposal that is otherwise approved in
writing by the Agent; 

  

	 	(d)	any disposal from an Obligor to another member of the Group; and/or 

  

	 	(e)	any disposal(s) not otherwise covered by the provisions of (a) to (d) above, up to an aggregate amount of £250,000 (or its equivalent in other currencies) in any financial year. 

“Permitted Guarantee” means: 
  

	 	(a)	any guarantee, indemnity, performance bond or similar obligation given by a member of the Group for its liabilities (or those of another member of the Group) in the ordinary course of business; 

 

	 	(b)	any indemnity or guarantee in respect of documentation for an acquisition or disposal by an Obligor that is permitted by the Loan Agreements; 

 

	 	(c)	any guarantee or indemnity by a member of the Group in respect of any Permitted Indebtedness; and/or 

  

	 	(d)	any other guarantee or indemnity not otherwise covered by the provisions of (a) to (c) above, given by a member of the Group, provided that the aggregate liability under such guarantees or indemnities permitted
under this paragraph (d) shall not exceed £250,000 (or its equivalent in other currencies) in aggregate. 

  
 61 

 “Permitted Indebtedness” is: 

 

	 	(a)	an Obligor’s Indebtedness to Lenders under this Agreement or the Loan Documents; 

  

	 	(b)	any sums payable pursuant to the Novartis Purchase Agreements; 

  

	 	(c)	subject to the Subordination Agreement, any sums owing under the Convertible Loans; 

  

	 	(d)	Indebtedness existing on the date of this Agreement and shown on the Perfection Certificates; 

  

	 	(e)	unsecured Indebtedness to creditors (including professional advisers, suppliers, landlords, Governmental Authorities, and service providers, and any netting or set-off arrangements with a bank or financial institution
with whom an Obligor holds an account) incurred and discharged in the ordinary course of business; 

  

	 	(f)	Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business; 

  

	 	(g)	Indebtedness secured by Liens permitted under paragraphs (a) and (c) of the definition of “Permitted Liens”; 

  

	 	(h)	any Indebtedness in respect of a Permitted Guarantee or Permitted Investment; 

  

	 	(i)	Indebtedness owed by any member of the Group to another member of the Group; 

  

	 	(j)	any Indebtedness in respect of any currency hedging agreement; 

  

	 	(k)	any Indebtedness otherwise approved by the Agent; and/or 

  

	 	(l)	any other Indebtedness not otherwise covered by the provisions of (a) to (k) above, provided that the principal aggregate amount of the Indebtedness permitted under this paragraph (l) shall not exceed
£250,000 (or its equivalent in other currencies) in aggregate. 

 “Permitted Investments” are:

  

	 	(a)	Investments (including Subsidiaries) existing on the date of this Agreement and shown on the Perfection Certificate; 

  

	 	(b)	Investments consisting of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of an Obligor’s business; 

 

	 	(c)	Investments accepted in connection with Transfers permitted by Clause 9.1 (Dispositions); 

  
 62 

	 	(d)	Investments (i) by an Obligor in its Subsidiaries to cover operating costs in the ordinary course of business of such Subsidiary (ii) by Borrower in Subsidiaries and (iii) by Subsidiaries in other
Subsidiaries or in Borrower; 

  

	 	(e)	Investments consisting of (i) travel advances and employee relocation loans and other employee loans and advances in the ordinary course of business, and (ii) loans to employees, officers or directors relating
to the purchase of equity securities of Borrower or its Subsidiaries pursuant to employee share purchase plans or agreements approved by Borrower’s Board of Directors; 

 

	 	(f)	Investments (including debt obligations) received in connection with the bankruptcy or reorganisation of customers or suppliers and in settlement of unfulfilled obligations of, and other disputes with, customers or
suppliers arising in the ordinary course of business; and 

  

	 	(g)	Investments consisting of notes receivable of, or prepaid royalties and other credit extensions to, customers and suppliers who are not Affiliates, in the ordinary course of business; provided that this paragraph
(i) shall not apply to Investments of Borrower in any Subsidiary; 

  

	 	(h)	Investments in respect of the incorporation or acquisition of new Subsidiaries, provided that, if required by Clause 8.2 (Further assurances), such Subsidiary shall become an Obligor; and/or 

 

	 	(i)	Investments not otherwise covered by the provisions of (a) to (h) above, provided that the principal aggregate amount of any Investments permitted under this paragraph (i) shall not exceed £250,000 (or
its equivalent in other currencies) in aggregate. 

 “Permitted Liens” are: 

 

	 	(a)	Liens arising under this Agreement, other Loan Documents or in favour of a Lender; 

  

	 	(b)	Liens for taxes, fees, assessments or other government charges or levies, either being contested in good faith or payment of which can be lawfully withheld and for which an Obligor maintains adequate reserves on
Obligor’s Books, if they have no priority over any of Security Agent’s Liens; 

  

	 	(c)	Purchase money Liens (i) on Equipment acquired or held by an Obligor incurred for financing the acquisition of the Equipment securing no more than Two Hundred and Fifty Thousand Sterling (£250,000) in the
aggregate amount outstanding, or (ii) existing on equipment when acquired, if the Lien is confined to the equipment itself and improvements and the proceeds of the equipment; 

  
 63 

	 	(d)	Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in (a) to (c) inclusive, but any extension, renewal or replacement Lien must be limited to the property
encumbered by the existing Lien and the principal amount of the indebtedness may not increase; 

  

	 	(e)	Liens in favour of other financial institutions arising in connection with an Obligor’s deposit accounts held at such institutions, provided that Security Agent has a perfected security interest in the amounts held
in such deposit accounts; 

  

	 	(f)	Liens arising by operation of law in the ordinary course of business; 

  

	 	(g)	Liens in respect of any rent deposit in relation to any lease of land or an interest in land by an Obligor; and/or 

  

	 	(h)	any Lien not otherwise covered by the provisions of (a) to (g), provided that the total Indebtedness secured by such Lien and permitted under this paragraph (h) shall not exceed one hundred thousand pounds
Sterling £100,000. 

 “Permitted Transferee” are 

 

	 	(a)	a nominee of the Lenders; 

  

	 	(b)	a regulated, reputable financial institution; 

  

	 	(c)	a member of the SVB Financial Group of companies; and/or 

  

	 	(d)	a Member of the same Fund Group. 

 “Person” is any individual, sole
proprietorship, partnership, limited liability company, joint venture, company, trust, unincorporated organisation, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or government agency.

 “Receiver” a receiver or receiver and manager or administrative receiver of the whole or any part of the Collateral; 

“Regulatory Authority” means any competent authority in any country or region that regulates medicines and healthcare and life
sciences products, including the UK Medicines and Healthcare Products Regulatory Agency, the European Medicines Agency, ethics committees and the US Food and Drug Administration. 

“Regulatory Change” is defined in Clause 11.12.1 (Additional Costs). 

“Repayment Date” the first Business Day of a calendar month, as specified in the Repayment Schedule; 

  
 64 

 “Repayment Schedule” in respect of Tranche 1 or Tranche 2, the fully amortising
repayment schedule issued by the Agent to the Borrower prior to the Drawdown Date (as supplemented or replaced from time to time); 

“Responsible Officer” is each executive director or other equivalent officer of any Obligor from time to time. 

“Restricted Licence” is any material licence or other agreement with respect to which Borrower is the licensee (a) that
prohibits or otherwise restricts Borrower from granting a security interest in Borrower’s interest in such licence or agreement or any other property, or (b) for which a default under or termination of could interfere with Security
Agent’s right to sell any Collateral. 
 “Restricted Party” means a person that is: 

 

	 	(a)	listed on, or owned or controlled by a person listed on a Sanctions List, or a person acting on behalf of such a person; 

  

	 	(a)	located in or organised under the laws of a country or territory that is subject to country- or territory-wide Sanctions, or a person who is owned or controlled by, or acting on behalf of such a person;

  

	 	(b)	otherwise a subject of Sanctions. 

 “Sanctions” means any trade, economic or
financial sanctions laws, regulations, embargoes or restrictive measures administered, enacted or enforced by a Sanctions Authority. 

“Sanctions Authority” means: 
  

	 	(a)	the Security Council of the United Nations; 

  

	 	(b)	the United States of America; 

  

	 	(c)	the European Union; 

  

	 	(d)	the United Kingdom; 

  

	 	(e)	the official institutions or agencies of any of paragraphs (a) to (d) immediately above, including OFAC, the United States Department of State, and Her Majesty’s Treasury. 

“Sanctions List” means the Specially Designated Nationals and Blocked Persons listed maintained by OFAC, the Consolidated List
of Financial Sanctions Targets maintained by Her Majesty’s Treasury, or any similar list maintained by, or public pronouncement of a Sanctions designation made by a Sanctions Authority, and that list of Tier 1 and Tier 2 sanctioned countries
maintained by either of the Lenders, each as amended, supplemented or substituted from time to time. 
 “Secured Parties”
means a Finance Party, a Receiver or any Delegate and “Secured Party” means any one of them. 

  
 65 

 “Security Documents” means the documents evidencing the security over the
Collateral, including the (i) Borrower Debenture; (ii) Guarantor 1 Debenture; (iii) Guarantor 2 Debenture, (iv) Guarantor 3 Debenture, (v) the IP Agreement, and such other and further documents and instruments as Agent deems
reasonably necessary; all in form and content reasonably acceptable to Agent. 
 “Sterling” or use of the sign
“£” means the lawful currency of the United Kingdom of Great Britain and Northern Ireland. 
 “Subordination
Agreement” a subordination agreement in the Agreed Form in respect of the Convertible Loans. 
 “Subsidiary” is a
subsidiary undertaking within the meaning of section 1162 Companies Act 2006. 
 “SVB Commitment” is Five Million Pounds
(£5,000,000) in respect of Tranche 1 and Five Million Pounds (£5,000,000) in respect of Tranche 2. 
 “T1 Advance
Payment” in respect of Tranche 1, three hundred and seventy thousand, seven hundred and one Pounds, thirty five pence (£370,701.35). 

“T1 Availability Period” in respect of Tranche 1 the period from and including the date hereof to the Closing Date. 

“T2 Advance Payment” in respect of Tranche 2, an amount equal to the last Monthly Repayment in respect of Tranche 2. 

“T2 Availability Period” in respect of Tranche 2, the period from and including the Closing Date to and including 31 April
2018. 
 “Tax Credit” means a credit against, relief or remission for, or repayment of, any Tax. 

“Tax Deduction” is defined in Clause 11.6.1 (Withholding; Gross-up). 

“Tax Payment” is defined in Clause 11.6.10 (Withholding; Gross-up). 

“Taxes” means any present or future taxes, levies, duties, imposts or other charges or withholdings of a similar nature
(including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same), and “Tax” and “Taxation” have a corresponding meaning. 

“Term Loan Amount” is together, the Kreos Commitment, and the SVB Commitment being an amount equal to Twenty Million Pounds
(£20,000,000). 
 “Term Loan Early Termination Fee” is defined in Clause 2.4.1(b) (Permitted Prepayment of Term Loan).

 “Term Loan” the term loan facility made or to be made by the Lenders to the Borrower under this Agreement comprising
Tranche 1 and Tranche 2 or the principal amount outstanding form time to time as described in Clause 2.1 (Term Loan). 

  
 66 

 “Trademarks” are trademark and service mark rights, registered or not, and the
entire goodwill of the business of Borrower connected with the trademarks, including as described in the Perfection Certificates. 

“Tranche 1” the loan amount of Ten Million Pounds (£10,000,000) available pursuant to Clause 2.1.1 during the T1
Availability Period. 
 “Tranche 2” the loan amount of Ten Million Pounds (£10,000,000) available pursuant to Clause
2.1.1 during the T2 Availability Period. 
 “Tranche” means Tranche 1 and Tranche 2, as the case may be. 

“Transfer” is defined in Clause 9.1 (Dispositions). 

“US Tax Obligor” means: 
  

	 	(a)	an entity that is resident for tax purposes in the United States; or 

  

	 	(b)	an entity, some or all of whose payments under the Loan Documents are from sources within the United States for US federal income tax purposes. 

“Warrant Certificate” shall have the same meaning as given to such term in the Warrant Instrument. 

“Warrant Instrument” means a warrant instrument in Agreed Form to be issued by the Borrower to Kreos Capital V (Expert Fund)
LP and SVB on Closing. 
  

	17.2	Interpretation. 

 In this Agreement, unless the context otherwise requires or the
contrary intention appears: 
  

	 	17.2.1	a reference to a provision of law is a reference to that provision as extended, applied, amended or enacted from time to time and includes any subordinate legislation; 

 

	 	17.2.2	the singular includes the plural and vice versa, and reference to any gender includes the other genders; 

  

	 	17.2.3	references to this Agreement or any other agreement or document are to this Agreement or such other agreement or document as it may be validly varied, amended, supplemented, restated, renewed, novated or replaced from
time to time; 

  

	 	17.2.4	references to any party to this Agreement include a reference to its successors and permitted assigns and permitted transferees under this Agreement; 

 

	 	17.2.5	references to “written” or “in writing” include all forms of visible reproduction in permanent form, including electronic messages; 

  
 67 

	 	17.2.6	the words “execution”, “signed”, “signature” and words of like import in any Loan Document shall be deemed to include electronic signatures or the keeping of records in electronic form,
each of which shall be of the same legal effect, validity and enforceability as a manually executed signature or the use of a paper-based recordkeeping systems as the case may be, to the extent and as provided for in any applicable law;

  

	 	17.2.7	the headings used in this Agreement are for convenience only and shall not affect the interpretation of this Agreement; 

  

	 	17.2.8	the parties hereto mutually acknowledge that they and their lawyers have participated in the preparation and negotiation of this Agreement. In cases of uncertainty this Agreement shall be construed without regard to
which of the parties caused the uncertainty to exist; 

  

	 	17.2.9	any reference to: 

  

	 	(a)	a “month” is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month (and “months” has a corresponding
meaning) save that, where any such period would otherwise end on a day which is not a Business Day, it shall end on the next Business Day, unless that day falls in the calendar month succeeding that in which it would otherwise have ended, in which
case it shall end on the preceding Business Day provided that, if a period starts on the last Business Day in a calendar month or if there is no numerically corresponding day in the month in which that period is to end, that period shall end on the
last Business Day in that latter month; 

  

	 	(b)	a “dispute” means any litigation or administrative or arbitration proceeding before or of any court, tribunal, arbitrator or governmental or municipal authority, any labour dispute, any dispute with any
governmental or municipal authority and any other dispute of any kind; 

  

	 	(c)	any covenant by a party not to do an act or thing includes an obligation not to permit or suffer such act or thing to be done; 

  

	 	17.2.10	the words “including” and “in particular” and any similar words or expressions are by way of illustration and emphasis only and do not operate to limit the generality or extent of any
other words or expressions; 

  

	 	17.2.11	all Exhibits to this Agreement form part of it and take effect as if set out in this Agreement, and any reference to this Agreement includes the Exhibits; and 

  
 68 

	 	17.2.12	references to Clauses and Exhibits refer to clauses of, and schedules and exhibits to, this Agreement. 

Signature page follows. 

  
 69 

 SIGNATURE PAGE 
  

					
	THE BORROWER	 		  	
			
	EXECUTED as a DEED by	 	)	  	
			
	MEREO BIOPHARMA GROUP PLC	 	)	  	
			
	acting by  Denise
Scots-Knight                                 (director) a	 	)	  	
	director in the presence of a witness	 	)	  	
		 	)	  	
		 	)	  	
			
		 		  	 /s/ Denise Scots-Knight

		 		  	Director
			
		 		  	 /s/ Grace Hamlett

		 		  	Witness
			
	Name:	 		  	Grace Hamlett
			
	Address:	 		  	67A Abbey Road
			
		 		  	London, NW8 OAE
			
	Occupation:	 		  	Legal Counsel
			
	GUARANTOR 1	 		  	
			
	EXECUTED as a DEED by	 	)	  	
			
	MEREO BIOPHARMA 1 LIMITED	 	)	  	
			
	acting by  Richard
Jones                                        
     (director) a	 	)	  	
	director in the presence of a witness	 	)	  	
		 	)	  	
		 	)	  	
			
		 		  	 /s/ Richard Jones

		 		  	Director
			
		 		  	 /s/ Grace Hamlett

		 		  	Witness
			
	Name:	 		  	Grace Hamlett
			
	Address:	 		  	67A Abbey Road
			
		 		  	London, NW8 OAE
			
	Occupation:	 		  	Legal Counsel

  
 70 

					
	GUARANTOR 2	 	)	 	
			
	EXECUTED as a DEED by	 	)	 	
			
	MEREO BIOPHARMA 2 LIMITED	 	)	 	
			
	acting by  Richard
Jones                                        
 (director) a	 	)	 	
	director in the presence of a witness	 	)	 	
		 	)	 	
			
		 		 	 /s/ Richard Jones

		 		 	Director
			
		 		 	 /s/ Grace Hamlett

		 		 	Witness
			
	Name:	 		 	Grace Hamlett
			
	Address:	 		 	67A Abbey Road
			
		 		 	London, NW8 OAE
			
	Occupation:	 		 	Legal Counsel
			
	GUARANTOR 3	 	)	 	
			
	EXECUTED as a DEED by	 	)	 	
			
	MEREO BIOPHARMA 3 LIMITED	 	)	 	
			
	acting by  Richard
Jones                                        
 (director) a	 	)	 	
	director in the presence of a witness:	 	)	 	
		 	)	 	
			
		 		 	 /s/ Richard Jones

		 		 	Director
			
		 		 	 /s/ Grace Hamlett

		 		 	Witness
			
	Name:	 		 	Grace Hamlett
			
	Address:	 		 	67A Abbey Road
			
		 		 	London, NW8 OAE
			
	Occupation:	 		 	Legal Counsel

  
 71 

					
	THE LENDER, AGENT AND SECURITY AGENT	 	
			
	EXECUTED as a DEED by	 	)	 	
			
	KREOS CAPITAL V (UK) LIMITED	 	)	 	
			
	acting
by                                        
                           (director) a	 	)	 	
	director in the presence of a witness	 	)	 	
			
		 		 	 /s/ Ross Ahlgren

		 		 	Director
			
		 		 	 /s/ Lauren Mahoney

		 		 	Witness
			
	Name:	 		 	Lauren Mahoney
			
	Address:	 		 	25 Old Burlington Pl,
			
		 		 	London W15 3AN
			
	Occupation:	 		 	Administrator
			
	THE LENDER	 		 	
			
	EXECUTED as a DEED on behalf of	 	)	 	
			
	SILICON VALLEY BANK	 	)	 	
			
	a California corporation by	 	)	 	
	 Nooman
Haque                                (authorised signatory),

being a person who, in accordance with the laws of that territory, is acting under the
	 	  
 )

)
	 	
	authority of the corporation	 	)	 	
			
		 		 	 /s/ Nooman Haque

		 		 	Authorised Signatory
			
		 		 	  

		 		 	

  
 72 

 EXHIBIT A 

LOAN PAYMENT/ADVANCE REQUEST FORM 

[Repayment Schedule to be attached to this form] 

DEADLINE FOR SAME DAY PROCESSING IS
MIDDAY LONDON TIME 
  

							
	Fax To:	 	  
	  	Date:	  	  

  

LOAN PAYMENT:
                    MEREO BIOPHARAMA GROUP PLC 
  

 

			
	From Account #                                  
                                         
      	  	To Account #                                  
                                         
    
		
	(Deposit Account #)                                 
                                         
	  	(Loan Account #)                                 
                                        

		
	Principal £                                  
                                         
              	  	and/or Interest £                                
                                         
  

 

     

  

			
	Authorised Signature:                                 
                                   	  	Phone Number:                                  
                                         
  
		
	Print Name/Title:                                  
                                         
   	  	

  

     

 

LOAN ADVANCE: 
  

Complete Outgoing Wire Request section below if all or a portion of the funds from this loan advance are for an outgoing wire. 

 

     

  

			
	From Account #                                  
                                         
     	  	To Account #                                  
                                         
     
		
	
(Loan Account #)                     
                                         
                 
  
	  	
(Deposit Account #)                     
                                         
       
  

	    
		
	 Amount of Term Loan £
                                         
                         
  
	  	
	    
		
	Date Term Loan is to be made                            
                              	  	

  
 73 

	
	  

All Borrower’s representations and warranties in the Loan Agreement are true, correct and complete in all material respects on the date of the telephone
transfer request for an advance, but those representations and warranties expressly referring to another date shall be true, correct and complete in all material respects as of such date: 

 

	
	  

  

			
	Authorised Signature:                                
                                    	  	Phone Number:                                  
                                         
 
		
	Print
Name/Title:                                       
                                       	  	

  

	
	  

 

OUTGOING WIRE REQUEST: 

Complete only if all or a portion of funds from the loan advance above is to be wired. 

Deadline for same day processing is midday London Time. 
  

	
	  

  

			
	Beneficiary Name:                                  
                                        	  	Amount of Wire:
£                                        
                               
		
	Beneficiary Bank:                                  
                                         
	  	Account Number:                                  
                                       
		
	City
and State:                                      
                                         
 	  	Sort Code:                                   
                                         
        

 By signing below, we acknowledge and agree that our funds transfer request shall be processed in accordance with and
subject to the terms and conditions set out in the agreements(s) covering funds transfer service(s), which agreements(s) were previously received and executed by us. 
  

	
	  

  

			
	Authorised Signature:                                  
                                     	  	2nd
Signature (if required):                                   
                      
		
	Print
Name/Title:                                       
                                       	  	Print Name/Title:                                  
                                       
		
	Telephone
#:                                        
                                         
    	  	Telephone
#:                                        
                                        

  

	
	  

  
 74 

 EXHIBIT B 

COMPLIANCE CERTIFICATE 
  

	TO:                  SILICON	VALLEY BANK 

                 KREOS CAPITAL V (UK) LIMITED 

 

	FROM:            MEREO	BIOPHARMA GROUP PLC. 

 The undersigned authorised officer of Mereo Biopharma Group plc (“Borrower”)
certifies that under the terms and conditions of the Loan Agreement between Borrower, Guarantors, Lenders, Agent and Security Agent (the “Agreement”), (1) Borrower and the Guarantors are in complete compliance for the period ending
                     with all required covenants except as noted below, (2) there are no Events of Default, (3) all representations and
warranties in the Agreement are true and correct in all material respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified
or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, (4) Borrower,
and each of the Guarantors, has timely filed all required tax returns and reports, and Borrower and the Guarantors have timely paid all taxes, assessments, deposits and contributions owed by Borrower and the Guarantors except as otherwise permitted
pursuant to the terms of Clause 5.10 (Taxation) of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of the Guarantors relating to unpaid employee payroll or benefits of which Borrower have not previously
provided written notification to Agent. Attached are the required documents supporting the certification. The undersigned certifies that these are prepared in accordance with GAAP consistently applied from one period to the next except as explained
in an accompanying letter or footnotes. The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower or the Guarantors are not in compliance with any of the terms of the Agreement, and that
compliance is determined not just at the date this certificate is delivered. Capitalised terms used but not otherwise defined herein shall have the meanings given to them in the Agreement. 

Please indicate compliance status by circling Yes/No under “Complies” column. 

 

					
	 Covenant
	 	 Required
	  	 Complies

	Monthly financial statements with Compliance Certificate	 	Within 30 days of each month end	  	Yes No
			
	Annual financial statement (Audited)	 	120 days of financial year end	  	Yes No
			
	Board approved operating plan	 	Within 30 days after the expiration of the immediately preceding financial year	  	Yes No
			
	Board meeting pack	 	No later than 30 days after the date on which each board meeting is held	  	Yes No

  
 75 

					
	
	 The following Intellectual Property was registered after the Closing Date (if no registrations, state “None”)

 
 The following legal actions are pending (if
none state “None”)

 The following are the exceptions with respect to the certification above: (If no exceptions exist, state “No exceptions
to note.”) 
  
  

 
  
  

 
  

									
	MEREO BIOPHARMA GROUP PLC	 		 	KREOS USE ONLY
			
	for itself and each GUARANTOR 	 		 	
					
		 		 		 	Received by:	 	  

					
	By:	 	
                     
                                         
     
	 		 	authorised signer	 	
					
	Name:	 	  
	 		 	Date:	 	  

					
	Title:	 	  
	 		 	Verified:	 	  

					
		 		 		 	authorised signer	 	
					
		 		 		 	Date:	 	  

					
		 		 		 	Compliance Status:	 	Yes No

  
 76 

 EXHIBIT C 

CLIENT PAYMENT INSTRUCTIONS 

KREOS 

 

			
	    Principal and Interest Repayments	  	Fee Payments
		
	    in Sterling	  	in Sterling
		
	    Please remit funds to:                            
                                       	  	Please remit funds to:                               
                                      
		
	    Account Number:                               
                                         
 	  	Account Number:                                  
                                         

		
	    IBAN:                                 
                                         
                	  	IBAN:                                     
                                         
              
		
	    Sort Code:                               
                                         
            	  	Sort Code:                                   
                                         
          
		
	    Swift Code:                               
                                         
          	  	Swift Code:                                   
                                         
        
		
	    Ref: Please quote your client name	  	Ref: Please quote your client name 
		
	                                      
                                         
                      	  	
                          
                                         
                                    

 

 
 SVB 

 

			
	    Principal and Interest Repayments	  	Fee Payments
		
	    in Sterling	  	in Sterling
		
	    Please remit funds to:                            
                                       	  	Please remit funds to:                               
                                      
		
	    Account Number:                               
                                         
 	  	Account Number:                                  
                                         

		
	    IBAN:                                 
                                         
                	  	IBAN:                                     
                                         
               
		
	    Sort Code:                               
                                         
            	  	Sort Code:                                   
                                         
          
		
	    Swift Code:                               
                                         
          	  	Swift Code:                                   
                                         
        
		
	    Ref: Please quote your client name	  	Ref: Please quote your client name
		
	                                      
                                         
                      	  	
                          
                                         
                                     

 

 

  
 77 

 EXHIBIT D 

FORM OF ACCESSION DEED 
  

			
	This Accession Deed is made on	  	201[●]

  

	(1)	Mereo BioPharma Group plc a company registered in England and Wales with registration number [●] and whose registered office is at [●] (the “Parent”) 

 

	(2)	[●] a company registered [●] in with registration number [●] whose registered office is at [●] (the “New Obligor”); and 

 

	(3)	KREOS CAPITAL V (UK) LIMITED a limited liability company incorporated under the laws of England & Wales with company number 09728300 and its registered office at 25 Old Burlington Street London W1S 3AN
(in its capacity as agent the “Agent”), 

 and is supplemental to a loan agreement made between the Borrower, the Guarantors,
the Agent, the Security Agent and Silicon Valley Bank on [●] 2017 (the “Loan Agreement”). 
 Now this Accession Deed witnesses as
follows: 
  

	1	DEFINITIONS AND INTERPRETATION 

 Unless a contrary intention appears, words and
expressions defined in the Loan Agreement have the same meaning in this Accession Deed and Clause 17.2 (Interpretation) of the Loan Agreement shall apply to this Accession Deed. 

 

	2	CONFIRMATION 

  

	2.1	The New Obligor confirms it has read and understood the content of the Loan Agreement. 

  

	2.2	The Parent confirms that no Default is continuing or will occur as a result of the accession of the New Obligor to the terms of the Loan Agreement. 

 

	3	ACCESSION 

 With effect from the date of this Accession Deed, the New Obligor becomes a
party to, and will be bound by the terms of, and assume the obligations and duties of a Borrower and Guarantor under, the Loan Agreement as if it had been a party to the Loan Agreement from [●] 2017. 

 

	4	CONSTRUCTION 

  

	4.1	The Loan Agreement shall continue and remain in full force and effect and this Accession Deed shall be read and construed as one with the Loan Agreement so that all references to “this Agreement” in the Loan
Agreement shall include reference to this Accession Deed. 

  

	4.2	This Accession Deed is a Loan Document. 

  
 78 

	5	GOVERNING LAW 

  

	5.1	This Accession Deed and any non-contractual obligations arising out of or in connection with it shall be governed by and construed in accordance with English law. 

 

	5.2	[Without prejudice to any other mode of service allowed under any relevant law, the New Obligor: 

  

	 	5.2.1	irrevocably appoints [●] as its agent for service of process in relation to any proceedings before the English courts in connection with any Loan Document (and [●] by its execution of this Deed accepts that
appointment); and 

  

	 	5.2.2	agrees that failure by an agent for service of process to notify the New Obligor of the process will not invalidate the proceedings concerned.]. 

IN WITNESS WHEREOF the Parent, the Guarantors, the New Obligor and the Agent have caused this Accession Deed to be duly executed on the date appearing
at the head of page 1. 

  
 79 

 EXHIBIT E 

FORM OF PERFECTION CERTIFICATE 

 

Notes: 
  

	 	1.	This is an “on-line” form designed to be completed on your computer in Microsoft Word. 

  

	 	2.	If there is not enough space for your answer, use the continuation sheet at the end of this form or attach a separate word document with the additional information. 

 

	 	3.	Submit this by e-mail to CharledsRussellSpeechlys LLP on behalf of the Lender. Please also print this form and submit a hard copy signed by an officer of the Company. 

 

	 	4.	This completed and executed certificate is a condition to closing and funding the loan. Information contained herein may have an impact on the drafting of the loan documents. The sooner this completed certificate is
received by the Lender, the more likely it is that the transaction can be finalised in a timely manner. 

PERFECTION CERTIFICATE 
  

	TO:	Kreos Capital V (UK) Limited and Silicon Valley Bank (the “Lender”) 

 The undersigned,
the [●] of MEREO BIOPHARMA GROUP PLC (the “Company”), hereby certify on behalf of the Company, that, with reference to the Loan Agreement dated [●] between the Company and the Lender, the information set out below is true and
accurate: 
 Note: if any question is inapplicable to the Company, simply add in “not applicable” or “none” as appropriate. 

 

	1	NAMES OF THE COMPANY 

  

	1.1	The name of the Company as it appears in its current Articles or Certificate of Incorporation is: [●] 

  

	1.2	The Company is formed under the laws of the Country of [●] 

  

	1.3	The organisational identification number of the Company is: [●] 

  

	1.4	The Company transacts business in the following jurisdictions (list all domestic and foreign jurisdictions other than jurisdiction of formation): [●] 

 

	1.5	The Company is duly authorised to carry and actually carroes on business in the following jurisdictions (list jurisdictions other than jurisdiction of formation): [●] 

 

	1.6	The following is a list of all other names (including fictitious names, d/b/a’s, trade names or similar names) currently used by the Company or used within the past five years: 

 

			
	 Name
	 	 Period of Use

	 [●]
	 	[●]

  
 80 

	1.7	The following are the names of all entities to which the Company became the successor by merger, consolidation, acquisition, change in form, nature or jurisdiction of organisation or otherwise, now or at any time during
the past five years: 

  

			
	 Name of Merged Entity
	 	 Year of Merger

	 [●]
	 	[●]

  

	1.8	The following are the names and addresses of all entities from whom the Company has acquired any personal property in a transaction not in the ordinary course of business during the past five years, together with the
date of such acquisition and the type of personal property acquired (e.g., equipment, inventory, etc.): 

  

							
	 Name
	 	 Address
	 	 Date of Acquisition
	 	 Type of Property

	 [●]
	 	 [●]
	 	 [●]
	 	 [●]

  

	2	PARENT/SUBSIDIARIES OF THE COMPANY 

  

	2.1	The legal name of each subsidiary or affiliate (hereafter “subsidiary” and “affiliate” are jointly, severally, and collectively referred to as “subsidiary” or “subsidiaries”) and
parent of the Company is as follows. (A “parent” is an entity owning more than 50% of the outstanding capital stock of the Company. A “subsidiary” is an entity, 50% or more of the outstanding capital stock of which is owned by
the Company.) 

  

			
	 Name
	 	 Subsidiary/Parent

	 [●]
	 	 Sub ☐  Parent ☐

		
	 [●]
	 	 Sub ☐  Parent ☐

		
	 [●]
	 	 Sub ☐  Parent ☐

  

	2.2	The following is a list of the respective jurisdictions and dates of formation of the parent and each subsidiary of the Company: 

  

					
	 Name
	 	 Jurisdiction
	 	 Date of Formation

	 [●]
	 	 [●]
	 	 [●]

			
	 [●]
	 	 [●]
	 	 [●]

			
	 [●]
	 	 [●]
	 	 [●]

  
 81 

	2.3	The following is a list of all other names (including fictitious names, d/b/a’s, trade names or similar names) currently used by each subsidiary of the Company or used during the past five years: 

 

			
	 Name
	 	 Subsidiary

	 [●]
	 	[●]

  

	2.4	The following are the names of all corporations which have been merged into a subsidiary of the Company during the five years: 

  

			
	 Name
	 	 Subsidiary

	 [●]
	 	[●]

  

	2.5	The following are the names and addresses of all entities from whom each subsidiary of the Company has acquired any personal property in a transaction not in the ordinary course of business during the past five years,
together with the date of such acquisition and the type of personal property acquired (e.g., equipment, inventory, etc.): 

  

									
	 Name
	  	 Address
	  	 Date of

Acquisition
	  	 Type of

Property
	  	 Subsidiary

	 [●]
	  	[●]	  	[●]	  	[●]	  	[●]

  

	3	LOCATIONS OF COMPANY AND ITS SUBSIDIARIES 

  

	3.1	The chief executive offices of the Company and its subsidiaries are presently located at the following addresses: 

  

			
	 Company/Subsidiary
	 	
Complete Street and Mailing Address, including County and

Zip Code

	 Company ☐ / [●]
	 	[●]

  
 82 

			
	 Company/Subsidiary
	 	
Complete Street and Mailing Address, including County and

Zip Code

	Company ☐ / [●]	 	[●]
		
	Company ☐ / [●]	 	[●]

  

	3.2	The Company’s books and records and those of its subsidiaries are located at the following additional addresses (if different from the above): 

 

			
	 Company/Subsidiary
	 	
Complete Street and Mailing Address, including County and

Zip Code

	Company ☐ / [●]	 	[●]
		
	Company ☐ / [●]	 	[●]
		
	Company ☐ / [●]	 	[●]

  

	3.3	The following are all the locations where the Company and its subsidiaries own, lease, or occupy any real property. Please indicate whether the location is owned, leased or rented: 

 

			
	 Company/Subsidiary
	 	
Complete Street and Mailing Address, including County and

Zip Code

	 Company ☐ / [●]
  

[Own/lease/rental]
	 	[●]
		
	 Company ☐ / [●]
  

[Own/lease/rental]
	 	[●]
		
	 Company ☐ / [●]
  

[Own/lease/rental]
	 	[●]

  

	3.4	The following are all of the locations where the Company and its subsidiaries maintain any inventory, equipment, or other property: 

 

			
	 Company/Subsidiary
	 	 Complete Street and Mailing Address, including County and

Zip Code

	Company ☐ / [●]	 	[●]

  
 83 

			
	 Company/Subsidiary
	 	
Complete Street and Mailing Address, including County and

Zip Code

	Company ☐ / [●]	 	[●]
		
	Company ☐ / [●]	 	[●]

  

	3.5	The following are the names and addresses of all warehousemen, bailees, or other third parties who have possession of any of the Company’s inventory or equipment or any of the inventory or equipment of its
subsidiaries: 

  

					
	 Company/Subsidiary
	 	 Name
	 	
Complete Street and Mailing Address,

including County and Zip Code

	Company ☐ / [●]	 	[●]	 	[●]
			
	Company ☐ / [●]	 	[●]	 	[●]
			
	Company ☐ / [●]	 	[●]	 	[●]

  

	4	SPECIAL TYPES OF COLLATERAL 

  

	4.1	The Company and its subsidiaries own (or have any ownership interest in) the following kinds of assets. (If the answer is “Yes” to any of the following questions, please attach a schedule describing each such
asset owned by the Company or its subsidiaries and identifying which party owns the asset.) 

  

					
	Copyrights or copyright applications registered with the [state appropriate filing office]	  	Yes  ☐	  	No  ☐
			
	Software registered with [state appropriate filing office]	  	Yes  ☐	  	No  ☐
			
	Unregistered software	  	Yes  ☐	  	No  ☐
			
	Patents and patent applications	  	Yes  ☐	  	No  ☐
			
	Trademarks or trademark applications (including any service marks, collective marks and certification marks)	  	Yes  ☐	  	No  ☐
			
	Licenses to use trademarks, patents and copyrights of others	  	Yes  ☐	  	No  ☐
			
	Licenses, permits (including environmental), authorisations, or certifications issued by federal, state, or local governments issued to the Company and/or its subsidiaries or with respect to their assets, properties, or
businesses	  	Yes  ☐	  	No  ☐
			
	Stocks, bonds or other securities	  	Yes  ☐	  	No  ☐

  
 84 

					
	Promissory notes, or other instruments or evidence of indebtedness	  	Yes  ☐	 	No  ☐
			
	Leases of equipment, security agreements naming such person as secured party or other chattel paper	  	Yes  ☐	 	No  ☐
			
	Aircraft	  	Yes  ☐	 	No  ☐
			
	Vessels, Boats or Ships	  	Yes  ☐	 	No  ☐
			
	Railroad Rolling Stock	  	Yes  ☐	 	No  ☐
			
	Motor Vehicles	  	Yes  ☐	 	No  ☐

  

	4.2	The following is a list of material contracts to which the Company is a party (include any equipment leases) or in which the Company has an interest (including whether such contract as a nonassignability provision which
would require the other party’s or another person’s consent to the granting of a security interest in such contract): 

  

											
	 Other Party

to Contract
	 	 Entity
	 	 Title/Date of Contract
	 	 Non-assignability Clause

	 	 	 	 Asset

Sale
 (Y/N)
	 	 Security

Interest
 (Y/N)
	 	 Consent

Obtained

(Y/N)

	 [●]
	 	[●]	 	[●]	 	[●]	 	[●]	 	[●]
						
	 [●]
	 	[●]	 	[●]	 	[●]	 	[●]	 	[●]
						
	 [●]
	 	[●]	 	[●]	 	[●]	 	[●]	 	[●]

  

	 	4.3	The following are all banks, brokerages, or financial institutions at which the Company and its subsidiaries maintain deposit, investment, payroll, or securities accounts: 

 

							
	 Bank Name
	 	 Account

Number
	 	 Bank Address
	 	 Company/Subsidiary

	[●]	 	[●]	 	[●]	 	Company ☐/ [●]
				
	[●]	 	[●]	 	[●]	 	Company ☐/ [●]
				
	[●]	 	[●]	 	[●]	 	Company ☐/ [●]

  

	4.4	Does or is it contemplated that the Company will regularly receive letters of credit from customers or other third parties to secure payments of sums owed to the 

  
 85 

	 	Company? The following is a list of letters of credit naming the Company as “beneficiary” thereunder: 

  

					
	 LC Number
	 	 Name of LC Issuer
	 	 LC Applicant

	 [●]
	 	[●]	 	[●]
			
	 [●]
	 	[●]	 	[●]
			
	 [●]
	 	[●]	 	[●]

  

	5	DEBT/ENCUMBRANCES 

  

	5.1	The Company’s and its subsidiaries’ have the following debt for money borrowed outstanding (whether or not convertible): 

  

							
	 Name of Lender
	 	 Original Principal

Amount/Principal

Outstanding
	 	 Maturity

Date
	 	 Company/Subsidiary

	 [●]
	 	[●]	 	[●]	 	Company ☐ / [●]
				
	 [●]
	 	[●]	 	[●]	 	Company ☐ / [●]

  

	5.2	The Company’s and its subsidiaries’ property are subject to the following liens or encumbrances: 

  

					
	 Name of Holder of

Lien/Encumbrance
	 	 Description of Property

Encumbered
	 	 Company/Subsidiary

	 [●]
	 	[●]	 	Company ☐ / [●]
			
	 [●]
	 	[●]	 	Company ☐ / [●]

  

	6	REGULATION 

 The Company and its subsidiaries are subject to regulation by the following
federal, state or local government entity or any department, agency, or instrumentality thereof: 
  

					
	 Name of Regulatory Entity
	 	 Description of Regulation
	 	 Company/Subsidiary

	 [●]
	 	[●]	 	Company ☐ / [●]
			
	 [●]
	 	[●]	 	Company ☐ / [●]

  
 86 

	7	LITIGATION 

  

	7.1	The following is a complete list of pending and threatened litigation or claims involving amounts claimed against the Company in an indefinite amount or in excess of $50,000 in each case: 

 

	 	7.1.1	[●] 

  

	 	7.1.2	[●] 

  

	7.2	The following are the only claims which the Company has against others (other than claims on accounts receivable), which the Company is asserting or intends to assert, and in which the potential recovery exceeds
$50,000: 

  

	 	7.2.1	[●] 

  

	 	7.2.2	[●] 

  

	8	TAXES 

 The following tax assessments are currently outstanding and unpaid: 

 

			
	 Assessing Authority
	 	 Amount and Description

	 [●]
	 	[●]
		
	 [●]
	 	[●]
		
	 [●]
	 	[●]

  

	9	INSURANCE BROKER 

 The following broker handles the Company’s property insurance:

  

									
	 Broker
	 	 Contact
	 	 Telephone
	 	 Fax
	 	 Email

	 [●]
	 	[●]	 	[●]	 	[●]	 	[●]

  

	10	OFFICERS OF THE COMPANY AND ITS SUBSIDIARIES 

 The following are the names and titles of
the officers of the Company and its subsidiaries. 
  

					
	 Office/Title
	 	 Name of Officer
	 	 Company/Subsidiary

	 [●]
	 	[●]	 	Company ☐ / [●]
			
	 [●]
	 	[●]	 	Company ☐ / [●]
			
	 [●]
	 	[●]	 	Company ☐ / [●]

  
 87 

 The Company agrees to advise you of any change or modification to any of the foregoing information or any
supplemental information provided on any continuation pages attached hereto, and, until such notice is received by you, you shall be entitled to rely upon such information and presume it is correct. The Company acknowledges that your acceptance of
this Perfection Certificate and any continuation pages does not imply any commitment on your part to enter into a loan transaction with the Company, and that any such commitment may only be made by an express written loan commitment, signed by one
of your authorised officers. 
  

			
	Date:	 	  

		
	By:	 	  

		
	Its:	 	  

		
	Email:	 	  

		
	Phone:	 	  

		
	Fax:	 	  

  
 88 

 CONTINUATION PAGE 

ADDITIONAL INFORMATION 
 [●] 

  
 89 

 EXHIBIT F 

PRIMARY AND SECONDARY ENDPOINTS 

acumapimod 
 acumapimod (BCT-197) primary
endpoints to be defined as: 
  

	•	 	Change in Forced Expiratory Volume in 1 second (FEV1) from baseline at 7 days 

 acumapimod (BCT-197) secondary
endpoints to be defined as: 
  

	•	 	Assessment of AUC of FEV1 over time 

  

	•	 	Time to normalisation of spirometry parameters 

  

	•	 	EXACT PRO 

 BGS-649 

BGS-649 primary endpoints to be defined as: 
  

	•	 	Normalisation of testosterone 

  

	•	 	Concentration of total testosterone in the normal range (300 – 1000 ng/dl) in >= 75 % of patients at 24 weeks 

BGS-649 secondary endpoints to be defined as: 
  

	•	 	Change in Luteinizing hormone (LH) and Follicle-stimulating hormone (FSH) 

  

	•	 	Semen analysis 

  

	•	 	Three PROs: International Index of Erectile Function, patient reported outcomes measurements information system and Brief Fatigue Inventory 

  
 90

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