Document:

Exhibit 10.12

 

January 28, 2020

 

Mark Hahn 

XXXXXXXXX

XXXXXXXXX

 

	Re:	Offer of Employment

 

Dear Mark:

 

On behalf of Verona
Pharma Inc. (the “Company” or “Verona Pharma”), I am pleased to offer you employment with the Company.
This offer letter agreement, together with Exhibit A hereto (together, the “Agreement”) sets forth the
terms of employment the Company is offering you. If you accept this offer, we anticipate that your first day of employment will
be February 1, 2020 (“Commencement Date”) and you will be appointed to the position of Chief Financial Officer
effective on March 1, 2020 (the “Appointment Date”). The term of this Agreement (the “Term”) shall
commence on the Commencement Date and end on the date this Agreement is terminated under Section 5.

 

		1.	Duties. Effective as of the Commencement Date
and until the Appointment Date, you will be employed by the Company, with such responsibilities, duties and authority normally
associated with such position and as may from time to time be lawfully assigned to you by the board of directors (the “Board”)
of Verona Pharma plc (“Parent”) and/or the Chief Executive Officer of the Company (the “CEO”). Effective
as of the Appointment Date, as Chief Financial Officer, you will have such responsibilities, duties and authority normally associated
with such position and as may from time to time be lawfully assigned to you by the Board and/or the CEO. During the Term, you will
report to the CEO. You shall devote your full time and attention to the business affairs of the Company and Parent (which shall
include service to their respective affiliates, if applicable) and shall not engage in outside business activities (including serving
on outside boards or committees) without the consent of the Board, which consent will not be unreasonably withheld, conditioned
or delayed, provided that you shall be permitted to (i) manage your personal, financial and legal affairs and (ii) participate
in trade associations, subject, in each case, to compliance with this Agreement and provided that such activities do not materially
interfere with your performance of your duties and responsibilities hereunder. You will be based out of the Company's offices in
North Carolina. You agree to observe and comply with the written rules and policies of the Company as adopted by the Company
from time to time, in each case as amended from time to time, as set forth in writing, and as delivered or made available to you.

 

		2.	Remuneration. During the Term, you will be
entitled to receive the payments and benefits set forth on Exhibit A hereto.

 

Verona
Pharma, Inc.

E-mail: info@veronapharma.com ▪ Website: www.veronapharma.com

 

     

     

    

 

	3.	Severance Benefits.

 

(a)           Termination
By The Company Without Cause or Termination by You for Good Reason. If this Agreement
is terminated by the Company without Cause (as defined below) or by you for Good Reason (as defined below), and if you sign an
agreement reasonably acceptable to the Company that (i) waives any rights you may otherwise have against the Company, Parent
and their respective affiliates, except for vested rights under any employee benefits plan or program or rights that cannot lawfully
be waived, (ii) releases the Company, Parent and their respective affiliates from any actions, suits, claims, proceedings
and demands you may have relating to the period of your employment with the Company and/or the termination of your employment,
and (iii) contains certain other obligations which will be set forth at the time of the termination, the Company shall provide
you with the following severance benefits:

 

		i.	an amount in cash equal to the product obtained by multiplying (x) 1.5 (or 1.0 if such termination
occurs after the second anniversary of the Commencement Date) times (y) the Annual Base Salary (as defined in Exhibit A
hereto), which amount shall be paid ratably over the 18 month period (or 12 month period if such termination occurs after the second
anniversary of the Commencement Date) following the termination date in accordance with the Company's regular payroll practices.
For the avoidance of doubt, the severance amounts that could become payable under this paragraph upon a qualifying termination
of employment that occurs on or prior the second anniversary of the Commencement Date are a deviation from Parent’s remuneration
policy (the “Remuneration Policy”) and are being offered as an incentive for you to join the Company.

 

		ii.	if you elect to receive continued medical, dental or vision coverage under one or more of the Company’s
group healthcare plans pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”),
continued payment, or reimbursement, as the case may be, of your COBRA premiums at the rate in effect upon termination for a period
commencing on your termination of employment and ending on the earliest of (x) the date that is 18 months (or 12 months if
such termination occurs after the second anniversary of the Commencement Date) following the termination of your employment, (y) the
date that you and/or your covered dependents become no longer eligible for COBRA, and (z) the date that you become eligible
to receive substantially similar coverage from a subsequent employer (and you agree to promptly notify the Company of such eligibility
or provide proof that such coverage is not substantially similar), provided that, notwithstanding the foregoing, if the Company
determines in its sole discretion that it cannot provide the foregoing benefit without potentially violating applicable law (including,
without limitation, Section 2716 of the Public Health Service Act) or incurring an excise tax, the Company shall in lieu thereof
provide to you a taxable monthly payment in an amount equal to the monthly COBRA premium that you would be required to pay to continue
your and your covered dependents’ group health coverage in effect on the date of termination (which amount shall be based
on the premium for the first month of COBRA coverage), less the amount you would have had to pay to receive group health coverage
for you and your covered dependents based on the cost sharing levels in effect on the date of termination, which payments shall
be made regardless of whether you elect COBRA continuation coverage and shall commence in the month following the month in which
the date of termination occurs and shall end on the earlier of (X) the date that is 18 months (or 12 months if such termination
occurs after the second anniversary of the Commencement Date) following the termination of your employment, (Y) the date that
you and/or your covered dependents become no longer eligible for COBRA or (Z) the date you become eligible to receive healthcare
coverage from a subsequent employer (and you agree to promptly notify the Company of such eligibility or provide proof that such
coverage is not substantially similar). For the avoidance of doubt, the severance benefits that could become payable under this
paragraph upon a qualifying termination of employment that occurs on or prior the second anniversary of the Commencement Date are
a deviation from the Remuneration Policy and are being offered as an incentive for you to join the Company;

 

    	 	2	 

     

    

 

		iii.	(A) if such termination occurs after the first anniversary of the Commencement Date, immediate
full vesting of all of the unvested equity or equity-based awards held by you under the 2017 Incentive Award Plan of Parent (the
“Plan”) or otherwise (collectively, the “Equity Awards”), provided that such Equity Awards that vest in
whole or in part based on the attainment of performance-vesting conditions shall vest based on the attainment of target level performance
(unless otherwise provided by the terms of the applicable award agreement) or (B) if such termination occurs on or before
the first anniversary of the Commencement Date, each unvested Equity Award shall become immediately vested as to the portion of
the applicable Equity Award that would have otherwise vested on or prior to the first anniversary of the date of such termination
had you remained employed with the Company during such period (and any remaining unvested portion of the Equity Awards will be
immediately forfeited upon termination);

 

		iv.	the Company shall pay you upon such termination a cash bonus equal to (a) 150% (or 100% if
such termination occurs after the second anniversary of the Commencement Date) of the amount of your full annual discretionary
bonus calculated as though all objectives had been achieved for the year of your termination; and (b) any discretionary bonus
that was earned in the previous fiscal year and not yet paid, which cash payment shall be made within 60 days following the date
of termination; and

 

		v.	the Company shall pay you for all accrued and unused paid time off within 60 days following the
date of termination.

 

(b)           Termination
By The Company With Cause, By Reason of Death or Disability or By Resignation. If this
Agreement is terminated by the Company at any time with Cause, by reason of your death or disability, or if you terminate your
employment with the Company under this Agreement without Good Reason, you shall not be entitled to any severance pay, severance
benefits, accelerated vesting or any compensation or benefits from the Company whatsoever but you shall be entitled to receive
(i) the Cash Base Salary (as defined in Exhibit A hereto) earned but not yet paid as of the date of termination;
(ii) reimbursement of all outstanding expenses owed to you under Section 5 of Exhibit A hereto; (iii) payment
of any discretionary bonus that was earned but not yet paid for the year prior to the year in which the date of termination occurs;
and (iv) all accrued and unused paid time off.

 

    	 	3	 

     

    

 

(c)           Determinations.
All decisions and determinations made by the Company under this Section 3 shall be made by the Board.

 

(d)           Definitions:

 

		i.	Cause. “Cause” for purposes of this Agreement shall mean if you: (1) shall
have been convicted of any felony or any other act involving fraud, theft, misappropriation, dishonesty, or embezzlement; (2) shall
have committed intentional acts that materially impair the goodwill or business of the Company, Parent or their respective affiliates
or cause material damage to the property, goodwill, or business of Company, Parent or their respective affiliates; (3) shall
have refused to, or willfully failed to, perform your duties hereunder or carry out, in any material respect, the lawful and reasonable
directive of the Board or the CEO; (4) shall have materially violated any written policies or procedures of the Company or
any of its affiliates; (5) shall have breached a material provision of this Agreement; or (6) shall have unlawfully used
(including being under the influence) or possessed illegal drugs on the Company’s (or any of its affiliates’) premises
or while performing your duties and responsibilities hereunder.

 

		ii.	Good Reason. “Good Reason” for purposes of this Agreement shall mean if (i) the
Company requires you to relocate more than 50 miles from the Company's offices in North Carolina; (ii) following the Appointment
Date, a material decrease in your authority, reporting or areas of responsibility; (iii) following the Appointment Date, any
change in your title or, following a Change in Control (as defined in the 2017 Incentive Award Plan of Parent), your ceasing to
serve as the chief financial officer of Parent or the Company, except if such change or cessation occurs as a result of action
taken by you; (iv) the Company decreases by 10% or more the Annual Base Salary or target bonus under this Agreement; or (v) a
material breach of this Agreement by the Company. In order for you to terminate your Employment for “Good Reason” under
this paragraph, within thirty (30) days after becoming aware of the breach or other event giving rise to your right to terminate,
you must have provided the Company with written notice of your right to terminate pursuant to this paragraph, the Company must
have failed to cure the breach or other event so specified, if curable, within thirty days after receiving such notice and you
must resign your employment within thirty days thereafter.

 

		iii.	Release Requirement and Timing of Severance Payments. In order to receive the severance
benefits under paragraph (a) above, as applicable, you must sign and tender the release as described above not later than
sixty (60) days following your last day of employment, or such earlier date as required by the Company, and if you fail or refuse
to do so, you shall forfeit the right to such termination compensation as would otherwise be due and payable. If the severance
payments are otherwise subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”),
they shall begin on the first pay period following the date that is sixty (60) days after your employment terminates and shall
otherwise begin on the first pay period after the release becomes effective (with the initial salary continuation payment to include
any unpaid salary continuation payments from the date your employment terminated), subject to your executing and tendering the
release on the terms as set forth in the immediately preceding sentence.

 

    	 	4	 

     

    

 

		4.	Company Policies And Confidentiality Agreement. As
an executive of the Company, you will be expected to abide by all of the applicable written policies and procedures of the Company
and its affiliates. As a condition of your employment, you agree to sign and to abide by the terms of a Confidential Information
and Inventions Assignment Agreement with the Company, which is attached hereto as Exhibit B.

 

		5.	At-will Employment. As an executive of the
Company, you may terminate your employment at any time and for any reason whatsoever simply by notifying the Company. Similarly,
the Company may terminate your employment at any time and for any reason whatsoever. Your at-will employment relationship with
the Company as modified by the terms of this Agreement cannot be changed except in writing signed by the Company’s CEO. Upon
termination of your employment for any reason, you shall be deemed to have resigned from all offices and directorships, if any,
then held with the Company, Parent or any of their respective affiliates.

 

		6.	Entire Agreement. This Agreement, including
Exhibit A, constitutes the complete, final and exclusive embodiment of the entire agreement between you and the Company
with respect to the terms and conditions of your employment specified herein. If you enter into this Agreement, you are doing so
voluntarily, and without reliance upon any promise, warranty or representation, written or oral, other than those expressly contained
herein. This Agreement supersedes any other such promises, warranties, representations or agreements. This Agreement may not be
amended or modified except by a written instrument signed by you and the Company’s CEO.

 

		7.	Governing Law. This Agreement will be governed
by and construed in accordance with the laws of the State of North Carolina.

 

		8.	Dispute Resolution. To ensure the timely and
economical resolution of disputes that arise in connection with your employment with the Company, you and the Company agree that
any and all disputes, claims, or causes of action arising from or relating to the enforcement, breach, performance or interpretation
of this Agreement, your employment, or the termination of your employment, shall be resolved to the fullest extent permitted by
law by final, binding and confidential arbitration, by a single arbitrator, in the District of Columbia, conducted by Judicial
Arbitration and Mediation Services, Inc. (“JAMS”) under the applicable JAMS employment rules. By agreeing to
this arbitration procedure, both you and the Company waive the right to resolve any such dispute through a trial by jury or judge
or administrative proceeding. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction
thereof in the State of North Carolina. In reaching his or her decision, the arbitrator shall have no authority (a) to authorize
or require the parties to engage in discovery (provided, however, that the arbitrator may schedule the time by which the parties
must exchange copies of the exhibits that, and the names of the witnesses whom, the parties intend to present at the hearing) (b) to
interpret or enforce the Confidential Information and Inventions Assignment Agreement (which shall not be covered by the dispute
resolutions contained in this paragraph), (c) to change or modify any provision of this Agreement, (d) to base any part
of his or her decision on the common law principle of constructive termination, or (e) to award punitive damages or any other
damages not measured by the prevailing party’s actual damages and may not make any ruling, finding or award that does not
conform to this Agreement. Each party shall bear his, her or its own legal fees, costs and expenses of arbitration and one-half
(1⁄2) of the costs of the arbitrator.

 

    	 	5	 

     

    

 

		9.	Section 409A. You and the Company intend
that the payments and benefits provided for in this letter either be exempt from Section 409A of the Code, or be provided
for in a manner that complies with Section 409A of the Code, and any ambiguity herein shall be interpreted so as to be consistent
with the intent of this Section 9. In no event whatsoever shall the Company be liable for any additional tax, interest or
penalty that may be imposed on you by Section 409A of the Code or damages for failing to comply with Section 409A of
the Code. Notwithstanding anything contained herein to the contrary, all payments and benefits under Section 3 above shall
be paid or provided only at the time of a termination of your employment that constitutes a “separation from service”
from the Company within the meaning of Section 409A of the Code and the regulations and guidance promulgated thereunder (determined
after applying the presumptions set forth in Treas. Reg. Section 1.409A-1(h)(1)). Further, if you are a “specified employee”
as such term is defined under Section 409A of the Code and the regulations and guidance promulgated thereunder, any payments
described in Section 3 above shall be delayed for a period of six (6) months following your separation of employment
to the extent and up to an amount necessary to ensure such payments are not subject to the penalties and interest under Section 409A
of the Code. In addition, (i) in-kind benefits and reimbursements provided under this Agreement during any calendar year shall
not affect in-kind benefits or reimbursements to be provided in any other calendar year, other than an arrangement providing for
the reimbursement of medical expenses referred to in Section 105(b) of the Code, and are not subject to liquidation or
exchange for another benefit and (ii) reimbursement requests must be timely submitted by you and, if timely submitted, reimbursement
payments shall be promptly made to you following such submission, but in no event later than December 31st of the
calendar year following the calendar year in which the expense was incurred. In no event shall you be entitled to any reimbursement
payments after December 31st of the calendar year following the calendar year in which the expense was incurred.
The reimbursement provisions in this Section 9 shall only apply to in-kind benefits and reimbursements that would result in
taxable compensation income to you.

 

    	 	6	 

     

    

 

		10.	Excise Tax.

 

(a)           280G
Parachute Payments. If any payment or benefit that you would receive following a Change
of Control or otherwise (“Payment”) would (i) constitute a “parachute payment” within the
meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999
of the Code (the “Excise Tax”), then such Payment shall be reduced to the Reduced Amount. The “Reduced Amount”
shall be either (A) the largest portion of the Payment that would result in no portion of the Payment being subject to the
Excise Tax or (B) the largest portion, up to and including the total amount, of the Payment, whichever of the amounts determined
under (A) and (B), after taking into account all applicable federal, state and local employment taxes, income taxes, and
the Excise Tax (all computed at the highest applicable marginal rate), results in your receipt, on an after-tax basis, of the
greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction
in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount,
reduction shall occur in the following order: reduction of cash payments; cancellation of accelerated vesting of outstanding awards
under the Plan; and reduction of employee benefits. In the event that acceleration of vesting of outstanding awards under the
Plan is to be reduced, such acceleration of vesting shall be undertaken in the reverse order of the date of grant of your outstanding
equity awards.

 

(b)           Calculations. All
calculations required to be performed under this Section 10 shall be made by a public accounting or employee benefits consulting
firm with a national practice selected by the Company (the “Accounting Firm”). The Accounting Firm shall provide detailed
supporting calculations on the applicable matter to both to the Company and you. All fees and expenses of the Accounting Firm
shall be borne solely by the Company. Any determination by the Accounting Firm shall be binding upon the Company and you.

 

		11.	Authorization to Work and Background Check. Your
employment with the Company is contingent upon satisfactory results from any pre-employment background checks that we may deem
necessary, including, but not limited to, a credit check, criminal background check, drug screening and confirmation of your legal
authorization to work in the United States. Our offer is also contingent upon you not being subject to any limitation, obligation
or agreement, whether imposed by contract, statute or otherwise, that would preclude your employment by the Company or in any way
restrict your ability to perform your duties as an executive. If you have provided the Company with any false information with
respect to your employment history, educational background or other credentials, the offer of employment contained herein shall
be withdrawn or, if you have already been hired, your employment shall be immediately terminated.

 

		12.	Key Person Insurance. At any time during the
Term, the Company, Parent and their respective affiliates shall have the right (but not the obligation) to insure your life for
the benefit of the Company, Parent and their respective affiliates. The Company, Parent or one of their respective affiliates shall
have the right to determine the amount of insurance and the type of policy. You shall reasonably cooperate with the Company, Parent
and their respective affiliates in obtaining such insurance by submitting to physical examinations, by supplying all information
reasonably required by any insurance carrier, and by executing all necessary documents reasonably required by any insurance carrier,
provided that any information provided to an insurance company or broker shall not be provided to the Company, Parent or their
respective affiliates without your prior written authorization. You shall incur no financial obligation by executing any required
document and shall have no interest in any such policy.

 

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		13.	Indemnification. The Company will indemnify
you to the fullest extent permitted by law and the Company’s Bylaws as further described in the Indemnification Agreement
between you and the Company attached hereto as Exhibit C and incorporated herein by reference.

 

If you choose to accept
this Agreement under the terms described above, please sign below and return this letter to me no later than January 31, 2020.

 

[Signature Page Follows]

 

    	 	8	 

     

    

 

We look forward to a productive and enjoyable
work relationship.

 

	Yours sincerely,	 
	 	 
	Verona Pharma Inc.	 
	 	 
	 	 
	/s/ Dr. David Ebsworth	 
	Name: 	Dr. David Ebsworth	 

	Position:	Authorized Representative	 

 

Accepted and Agreed to, solely with
respect to the matters set forth herein related to Verona Pharma plc, by:

 

	Verona Pharma plc	 
	 	 
	 	 
	/s/ Dr. David Ebsworth	 
	Name: 	Dr. David Ebsworth	 

	Position:	Chairman	 

 

	Accepted and Agreed to by:	 
	 	 
	 	 
	/s/ Mark Hahn	 
	Executive Name: Mark Hahn	 
	 	 
	 	 
	Date:	1/30/20	 

 

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Exhibit A

 

Remuneration

 

Capitalized terms used
but not defined in this Exhibit A shall have the meanings ascribed to such terms in the offer letter agreement to which this
Exhibit A is attached.

 

		1.	Base Salary.

 

		(a)	During the Term, you will be entitled to receive an annual aggregate base salary at a rate of $500,000,
which will be payable in two components each year, cash and restricted stock units. For the first year of the Term, your Annual
Base Salary (as defined below) will consist of $250,000 payable in cash and the issuance of restricted stock units under the Plan
worth $250,000 on the date of issue based on the Fair Market Value (as defined in the Plan) on the date of issue. For subsequent
years, you and the Company will agree upon the percentages of your Annual Base Salary to be allocated to cash or restricted stock
units, provided that the cash component of your Annual Base Salary shall always be a minimum of $250,000. The cash salary will
be less payroll deductions and withholdings, earned and payable in substantially equal installments in accordance with the Company’s
payroll policy from time to time in effect and which shall be pro-rated for partial years of employment in accordance with the
Company’s policy (as may be adjusted from time to time, the “Cash Base Salary”).

 

		(b)	During the Term, subject to the approval of the Board, and as soon as reasonably practicable after
January 1 of each calendar year during the Term, having regard to the Parent’s Share Dealing Policy, you will be granted,
pursuant to, and subject to, the Plan an award of restricted stock units having a grant date value of the amount of the Annual
Base Salary agreed upon to be allocated to restricted stock units for the applicable year (the “RSU Value”), which
amount shall be pro-rated for any partial years of employment (each, an “Annual RSU Award”). The definitive terms of
each Annual RSU Award will be governed by the Plan, which requires, as a condition of the grant, that you enter into a written
restricted stock unit agreement, which will contain the definitive terms of the Annual RSU Award. Each Annual RSU Award shall vest
quarterly during the calendar year in which the date of grant occurs, subject to your continued employment through each such quarter
and subject to Section 3 of the Agreement. The payment of a portion of your Annual Base Salary in the form of an Annual RSU
Award as described hereunder is intended to satisfy any obligations for you to maintain an investment or reinvest your Annual Base
Salary under the Remuneration Policy. Any award agreement issued to you will clearly state that Section 9.6 of the Plan shall
apply to the Equity Award to which such award agreement relates.

 

		(c)	The amounts payable under this Section 1 shall be annually reviewed from time to time by the
Board beginning in January 2021 and may be increased by the Board. For purposes of the Agreement, the term “Annual Base
Salary” shall mean the sum of (i) the Cash Base Salary and (ii) the RSU Value, in each case, as may be allocated
from time to time.

 

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		2.	Bonus. During the Term, you will be eligible
to participate in the Company’s annual bonus plan, with a target discretionary bonus of 50% of your Annual Base Salary, subject
to the terms of such plan and on such other terms and conditions as may be determined by the Company. You must be employed on the
date of payment of the bonus in order to be eligible for the bonus, except as otherwise provided in Section 3 of the Agreement.
The bonus will be pro-rated for any partial year of employment.

 

		3.	Additional equity.

 

		(a)	In addition to the Annual RSU Award, and subject to approval at the Annual General Meeting of Parent
in April 2020, you will be granted (i) during or prior to the first open trading window of Parent following the date
of such Annual General Meeting, pursuant to, and subject to, the Plan an award of restricted stock units in an amount equal to
3% of the outstanding ordinary shares of the Parent (the “First Equity RSU Award”), as determined as of the date of
such Annual General Meeting and (ii) during or prior to the first open trading window of Parent following the date that is
six months following the Commencement Date (such date, the “Reference Date”), pursuant to, and subject to, the Plan
an award of restricted stock units in an amount equal to 1% of the outstanding ordinary shares of the Parent (the “Second
Equity RSU Award,” and together with the First Equity RSU Award, the “Equity RSU Awards”), as determined as of
the date of such Annual General Meeting. The definitive terms of each Equity RSU Award will be governed by the Plan, which requires,
as a condition of the grant, that you enter into a written restricted stock unit agreement, which will contain the definitive terms
of each Equity RSU Award. The First Equity RSU Award shall vest over four years, with 25% vesting on the first anniversary of the
Commencement Date and the remainder vesting quarterly over the three remaining years following the first anniversary of the Commencement
Date, subject to your continued employment through the applicable vesting date and subject to Section 3 of this Agreement.
The Second Equity RSU Award shall vest over four years, with 25% vesting on the first anniversary of the Reference Date and the
remainder vesting quarterly over the three remaining years following the first anniversary of the Reference Date, subject to your
continued employment through the applicable vesting date and subject to Section 3 of this Agreement. If a Change of Control
occurs prior to the Reference Date, then immediately prior to the closing of such Change of Control, the Company shall issue to
you the Second Equity RSU Award, which will automatically vest upon the closing of the Change of Control.

 

		(b)	You and the Company acknowledge and agree that, if the Company raises additional equity capital
during fiscal year 2020, such financing will likely result in the dilution of the Equity RSU Awards. Therefore, the Company agrees
that, upon the closing of any round of financing during fiscal year 2020 (excluding any Change in Control or any financing that
occurs following your termination of employment from the Company), the Company will issue to you additional awards of restricted
stock units (“Additional Equity RSU Award,” and, together with the Equity RSU Awards, the “Combined Equity RSU
Awards”) during or prior to the first open trading window of Parent following such closing, so that after each such issuance,
all of the Combined Equity RSU Awards, plus any other equity awards granted to you from the Plan (specifically excluding any and
all Annual RSU Awards), will equal 4% of the outstanding ordinary shares of the Parent on the applicable date of issuance. Seventy-five
percent (75%) of each Additional Equity RSU Award will have the same vesting schedule as the First Equity RSU Award including the
commencement date of the vesting, and twenty-five percent (25%) of each Additional Equity RSU Award will have the same vesting
schedule as the Second Equity RSU Award including the commencement date of the vesting.

 

    11

     

    

 

		(c)	Notwithstanding the foregoing, the Board may settle a portion of any Combined Equity RSU Award
and any Annual RSU Award in cash as necessary to satisfy tax withholding requirements. Any award agreement issued to you will clearly
state that Section 9.6 of the Plan shall apply to the Equity Award to which such award agreement relates. Furthermore, in
the event that the Administrator (as defined in the Plan) takes any action with respect to any Equity Award pursuant to Section 8.2
of the Plan, other than pursuant to Section 8.2(c) of the Plan, the unvested portion of the Equity Award will become
immediately vested upon the applicable Corporate Event (as defined in the Plan).

 

		4.	Stock Options. You shall be entitled to participate
in the Plan with such awards as the Board of Directors recommends.

 

		5.	Benefits. During the Term, you will
be entitled to participate in the 401(k) plan and healthcare plan generally available from time to time to executives of the
Company, subject to the terms of such plans. You will be entitled to 25 days of paid time off per year, earned and accrued on a
pro rata basis throughout the year, provided that you may carry over only five days of accrued but unused time into the first quarter
of the subsequent year. Such time off shall be taken at the reasonable and mutual convenience of you and the Company. You will
be paid for all accrued and unused paid time off upon termination of employment.

 

		6.	Expenses. During the Term, you shall be entitled
to reimbursement for all ordinary and reasonable out-of-pocket business expenses which are reasonably incurred by you in furtherance
of the Company’s business and in accordance with the standard policies of the Company, Parent and their respective affiliates,
provided that you produce to the Company such evidence of actual payment as the Company may require.

 

    12

     

    

 

Exhibit B

 

Confidential Information and Inventions
Assignment Agreement

 

(attached)

 

     

     

    

 

EXECUTIVE
Confidential Information and Inventions Assignment Agreement

 

THIS EXECUTIVE
Confidential Information and Inventions Assignment Agreement is made and entered into as of the 1 day of Feb, 2020, by and
between Mark Hahn and Verona Pharma plc and each of its subsidiaries, affiliates, successors or assigns (collectively, Verona Pharma
plc and each of its subsidiaries, affiliates, successors and assigns shall be referred to herein as the "Company").

 

1.             I
acknowledge and agree that solely by virtue of my employment with Verona Pharma Inc., a wholly-owned subsidiary of the Company, I
will acquire "Confidential Information,” as well as special knowledge of the Company's relationships with its
customers, prospective customers and suppliers, and that, but for my association with the Company, I will not have had access
to the Confidential Information or knowledge of the relationships. As a condition precedent to the Company employing me, and as
consideration for my employment, I represent and warrant as follows:

 

A.           I
have voluntarily signed this Agreement after determining that the provisions contained in this Agreement are of a material benefit
to me, and that the duties and obligations imposed on me are fair and reasonable and will not prevent me from earning a comparable
livelihood following the termination of my employment with the Company.

 

B.            I
have read and fully understand the terms of this Agreement and have considered its benefits and consequences. I also have informed
the Company of, and provided the Company with copies of, any non-competition, confidentiality, work-for-hire or similar agreements
to which I am subject or may be bound.

 

C.            I
agree that, during the time of my employment with the Company and for a period of one (1) year after the termination of my
employment, whether voluntary or involuntary, I will not, directly or indirectly, except on behalf of the Company:

 

(1)            contact,
solicit or accept if offered to me, or direct any person or entity to contact, solicit or accept if offered to it, any of the Company's
customers or prospective customers for the purpose of providing any products and/or services that are the same as or similar to
the products and services provided by the Company to its customers during the term of my employment or for the purpose of otherwise
interfering with the business relationships between the Company and its customers or prospective customers;

 

(2)            solicit,
divert or take away any customers, clients, or business acquisition or other business opportunity of the Company;

 

(3)            induce
any distributor, supplier, representative or agent of the Company to terminate or modify its relationship with the Company; or

 

    

     

    

 

(4)            solicit
or accept if offered to me, with or without solicitation, on my own behalf or on behalf of any other person or entity, the services
of any person who is a current employee or independent contractor of the Company (or was an employee or independent contractor
of the Company during the year preceding such solicitation), nor solicit any of the Company's current employees or independent
contractors (or any individual who was an employee or independent contractor of the Company during the year preceding such solicitation)
to terminate employment or an engagement with the Company, nor agree to hire any current employee or independent contractor (or
any individual who was an employee or independent contractor of the Company during the year preceding such hire) of the Company
into employment or an engagement with me or any other person or entity; or

 

(5)            become,
directly or indirectly, associated or engaged with any business, whether as an investor (excluding passive investments representing
less than one percent (1%) of the common stock of a public company), lender, owner, stockholder, member, manager, officer, director,
employee, consultant, agent or in any other capacity, involved in the development and/or marketing of medicines to treat respiratory
diseases or any other business that may be carried on by the Company from time to time (as such business may be expanded from time
to time), including any business that the Company has taken substantial steps to enter into as of applicable date.

 

D.            I
acknowledge and agree that the scope described above is necessary and reasonable in order to protect the Company in the conduct
of its business and that, if I become employed by another employer, I will be required to disclose the existence of this Paragraph 1
to such employer and I consent to and the Company is given permission to disclose the existence of this Paragraph 1 to such
employer. I further acknowledge and agree that, if I breach any of the requirements of subparagraph C, the one (1) year
restricted period set forth therein shall be tolled during the time of such breach.

 

E.            For
purposes of this Paragraph 1: (i)  "customer" is defined as any person or entity that purchased any type
of product and/or service from the Company (including as a licensee) or is or was doing business with the Company or me within
the twelve (12) month period immediately preceding the solicitation or other activity prohibited by subparagraph C; (ii) 
"prospective customer" is defined as any person or entity contacted or solicited by the Company or me (whether
directly or indirectly) or who contacted the Company or me (whether directly or indirectly) within the twelve (12) month period
immediately preceding the solicitation or other activity prohibited by subparagraph C for the purpose of having such persons or
entities become a customer of the Company (including as a licensee); and (iii) “supplier” is defined as
any person or entity who is or was supplying products or services to the Company (including as a licensor) within the twelve (12)
month period immediately preceding the activity prohibited by subparagraph C.

 

    

     

    

 

F.            I
agree that both during my employment and thereafter I will not use for myself or disclose to any person not employed by the Company
any "Confidential Information" of the Company acquired by me during my relationship with the Company, except where such
disclosure is consented to, or approved by, the Company. I agree that "Confidential Information" includes but
is not limited to:

 

(1)            the
Company's corporate, business development and marketing strategy and plans;

 

(2)            budgets,
management accounts, bank account details and other confidential financial data of the Company;

 

(3)            know-how
and products being developed by the Company, including inventions and discoveries, biological and chemical formulations, research
and development methods and processes, scientific techniques and formulas and results of experimentation and testing including,
without limitation, clinical, biological, pharmaceutical, toxicological and pre-clinical and clinical test data;

 

(4)            reports,
confidential aspects of the Company’s computer technology and systems, confidential algorithms developed or used by the Company,
confidential information relating to proprietary computer hardware or software (including updates) not generally known to the public;

 

(5)            confidential
methods and processes, information relating to the running of the Company's business which is not in the public domain, including
details of salaries, bonuses, commissions and other employment terms applicable within the Company;

 

(6)            the
names, addresses and contact details of any existing or prospective customers, suppliers or business partners of the Company and
their requirements for any of the Company's products or services. Without prejudice to the foregoing, this includes personal information
provided to the Company by visitors to and users of any of its websites;

 

(7)            the
terms on which the Company does business with any existing or prospective customers, suppliers or business partners of the Company
and the terms of any partnership, joint venture or other form of commercial co-operation or agreement the Company enters into with
any third party;

 

(8)            software
and technical information necessary for the development, maintenance or operation of any of the Company's websites and the source
code of each website;

 

(9)            any
other information which the Company is bound by an obligation of confidence owed to a third party, in particular the content of
discussions or communications with any prospective customers, suppliers or business partners; and

 

    

     

    

 

(10)          any
other information, written, oral or electronic, whether existing now or at some time in the future, which pertains to the Company's
affairs or interests or with whom the Company does business.

 

The Company acknowledges and
agrees that Confidential Information does not include (a) information properly in the public domain, or (b) information
in my possession prior to the date of my original employment with the Company, except to the extent that such information is or
has become a trade secret of the Company or is or otherwise has become the property of the Company.

 

G.            I
shall not, except in the proper performance of my duties, or with the Company’s permission, remove any property belonging
or relating to the Company from the Company’s premises, or make any copies of documents or records relating to the Company’s
affairs. Upon the Company’s request at any time, and in any event on the termination of my employment, I shall immediately
deliver up to the Company or its authorized representative any plans, keys, mobile telephone, security passes, credit cards, equipment,
documents, records, papers, computer disks, tapes or other computer hardware or software (together with all copies of the same),
and all property of whatever nature in my possession or control which belongs to the Company or relates to its affairs. I shall,
at the Company’s request, provide the Company with a written statement that I have complied with this obligation. If I have
any information relating to the Company or work I have carried out for the Company which is stored on a computer or laptop computer,
whether or not the computer is owned by the Company, the Company shall be entitled to download the information and/or supervise
its deletion from the computer or laptop concerned.

 

H.            I
recognize and agree that all ideas, know how, confidential information, inventions, discoveries, biological and chemical formulations,
research and development methods and processes, scientific techniques and formulas and results of experimentation and testing including,
without limitation, clinical, biological, pharmaceutical, toxicological and pre-clinical and clinical test data, products, patents,
designs, trademarks, database right or copyright work or any right to prevent reproduction whether or not any of these is registered
and including applications for any such right, matter or thing or registration thereof and all rights or forms of protection of
a similar nature or having equivalent or similar effect to any of these which may subsist anywhere in the world, and all trade
secrets, business applications, plans, writings and other developments or improvements and all other intellectual property and
proprietary rights and any derivative works based thereon (the "Inventions") made, conceived, or completed by
me, alone or with others, during the time of my employment, whether or not during working hours, that are within the scope of the
Company's business operations, or that relate to any of the Company’s work or projects, are the sole and exclusive property
of the Company. I further agree that (1) I will promptly disclose all Inventions to the Company and hereby assign to the Company
all present and future rights I have or may have in those Inventions; and (2) all of the Inventions eligible under the copyright
laws are "work made for hire." At the request of and without charge to the Company, I will do all things deemed
by the Company to be reasonably necessary to perfect title to the Inventions in the Company and to assist in obtaining for the
Company such patents, copyrights or other protection as may be provided under law and desired by the Company, including but not
limited to executing and signing any and all relevant applications, assignments, or other instruments. I hereby irrevocably designate
and appoint the Company and its duly authorized officers and agents as my agents and attorneys in fact to act for and in my behalf
and instead of me, to execute and file any documents and to do all other lawfully permitted acts to further the above purposes
with the same legal force and effect as if executed by me, and I acknowledge that this designation and appointment constitutes
an irrevocable power of attorney and is coupled with an interest. I agree and acknowledge that all original works of authorship
(“Works”) that have been or are, during the term of my employment, made by me within the scope of my employment
or made previously in association with the Company or in connection with the creation or development of any of the Company’s
products, marketing materials, designs, logos or other content shall be deemed to be “works made for hire” pursuant
to the United States Copyright Act and all right, title and interest in and to such works are and shall be owned by the Company.
In the event any such Works are not deemed to be works made for hire, I hereby irrevocably assign to the Company all my right,
title and interest in and to such Works. I also waive any “moral rights” I may have in such Works, including any right
to object to or prevent the modification of the Work or to withdraw from circulation or control the publication or distribution
of the Work. Notwithstanding the foregoing, I acknowledge that, the Company has informed me that the provisions of this Paragraph H
will not apply to any Inventions for which no equipment, supplies, facility or trade secret information of the Company was used
and which were developed entirely on my own time, unless (1) the Invention relates (i) to the business of the Company,
or (ii) to actual or demonstrably anticipated research or development of the Company, or (2) the Invention results from
any work performed by me for the Company.

 

    

     

    

 

I.             I
acknowledge and agree that I have no expectation of privacy with respect to the Company’s telecommunications, networking
or information processing systems (including, without limitation, stored computer files (whether on a Company computer or a home
personal computer), email messages and voice messages) and that my activity and any files or messages on or using any of those
systems may be monitored at any time without notice.

 

J.             It
is agreed that any breach of any of the covenants contained in this Paragraph 1 will result in irreparable harm and continuing
damages to the Company and its business and that the Company's remedy at law for any such breach will be inadequate and, accordingly,
in addition to any and all other remedies that may be available to the Company, any court of competent jurisdiction may issue a
decree of specific performance or issue a temporary and permanent injunction, without the necessity of the Company posting bond
or furnishing other security and without proving special damages or irreparable injury, enjoining and restricting the breach of
any such covenant. I agree to pay all of the Company's costs and expenses, including reasonable attorneys' and accountants' fees,
incurred in enforcing such covenants.

 

    

     

    

 

 

K.            I
agree, during the term of my employment and following the termination of employment, to refrain from Disparaging (as defined below)
the Company and its affiliates, including any of its services, technologies or practices, or any of its directors, officers, agents,
representatives or equityholders, either orally or in writing. Nothing in this paragraph shall preclude me from making truthful
statements that are reasonably necessary to comply with applicable law, regulation or legal process, or to defend or enforce my
rights under this Agreement. For purposes of this Agreement, “Disparaging” means making remarks, comments or statements,
whether written or oral, that impugn the character, integrity, reputation or abilities of the Person being disparaged.

 

2.             Nothing
contained in this Agreement creates any right of employment or limits or restricts the Company's or my right to terminate my employment
at any time with or without cause.

 

3.             I
hereby authorize the Company, at any time during my employment or following my termination, to withhold from any monies it otherwise
owes me (including without limitation salary, bonus, commissions and expense reimbursements) any and all monies due from me to
the Company (including without limitation cash and travel advances, overpayments made to me by the Company, and any debt I owe
the Company for any reason, including without limitation misuse or misappropriation of Company assets). At the termination of my
employment with the Company or at any other time upon reasonable notice, I agree to execute whatever documentation may be
necessary to authorize the Company to make the withholdings described in this paragraph.

 

4.             I
may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof,
and shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and
other information sought and shall assist such counsel at Company’s expense in resisting or otherwise responding to such
process, in each case to the extent permitted by applicable laws or rules. Nothing in this Agreement shall prohibit me from (i) disclosing
information and documents when required by law, subpoena or court order (subject to the requirements of this Section), (ii) disclosing
information and documents to my attorney or financial or tax adviser for the purpose of securing legal, financial or tax advice,
(iii) reporting possible violations of federal law or regulation to any United States governmental agency or entity in accordance
with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806
of the Sarbanes-Oxley Act of 2002, or any other whistleblower protection provisions of state or federal law or regulation (including
the right to receive an award for information provided to any such government agencies), (iv) disclosing my post-employment
restrictions in this Agreement in confidence to any potential new employer, or (v) retaining, at any time, my personal correspondence,
my personal contacts and documents related to my own personal benefits, entitlements and obligations. Furthermore, in accordance
with 18 U.S.C. § 1833, the Company hereby notifies me that, notwithstanding anything to the contrary herein: (a) I shall
not be in breach of this Agreement, and shall not be held criminally or civilly liable under any federal or state trade secret
law (i) for the disclosure of a trade secret that is made in confidence to a federal, state, or local government official
or to an attorney solely for the purpose of reporting or investigating a suspected violation of law, or (ii) for the disclosure
of a trade secret that is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made
under seal and (b) if I file a lawsuit for retaliation by the Company for reporting a suspected violation of law, I
may disclose the trade secret to my attorney, and may use the trade secret information in the court proceeding, if I file any
document containing the trade secret under seal, and does not disclose the trade secret, except pursuant to court order.

 

     

     

    

 

5.             It
is our intention that all provisions of this Agreement be enforced to the fullest extent permitted by law. If any provision of
this Agreement shall be found invalid or unenforceable for any reason, in whole or in part, then such provision shall be deemed
modified, restricted, or reformulated to the extent and in the manner necessary to render the same valid and enforceable, or shall
be deemed excised from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum
extent permitted by law, as if such provision had been originally incorporated herein as so modified, restricted, or reformulated
or as if such provision had not been originally incorporated herein, as the case may be. The Company and I further agree to seek
a lawful substitute for any provision found to be unlawful; provided, that, if we are unable to agree upon a lawful substitute,
the Company and I desire and request that a court or other authority called upon to decide the enforceability of this Agreement
modify those restrictions in this Agreement that, once modified, will result in an agreement that is enforceable to the maximum
extent permitted by the law in existence at the time of the requested enforcement. This Agreement contains the entire understanding
and agreement between us with respect to this subject matter, and supersedes all prior oral and written agreements, if any, between
us with respect to that subject matter. I understand and acknowledge that the Company’s rights under this Agreement shall
inure to the benefit of any of its successors and/or assigns, and I shall continue to be bound by the terms hereof with any of
the Company’s successors and/or assigns.

 

6.             I
understand that the Company does not wish to incorporate any unlicensed or unauthorized material into its products or services
or those of its subsidiaries. Therefore, I agree that I will not knowingly disclose to the Company, use in the Company’s
business, or cause the Company to use, any information or material which is confidential or proprietary to any third party including,
but not limited to, any former employer, competitor or client, unless the Company has a right to receive and use such information.
I will not incorporate into my work any material that is subject to the copyrights of any third party unless the Company has a
written agreement with that third party or otherwise has the right to receive and use such information.

 

7.            This
Agreement will be governed and construed in accordance with the laws of the State of North Carolina, including the internal conflicts
of law. I agree and consent to submit to personal jurisdiction in the State of North Carolina in any state or federal court of
competent subject matter jurisdiction situated in the State of North Carolina. I further agree to waive any right I otherwise
may have to a trial by jury in any action to enforce the terms of this Agreement.

 

     

     

    

 

We have executed this
Agreement on the day and year first above written.

 

Verona Pharma plc

 

 

		 
	By: 	/s/
Dr. David Ebsworth	 
	Name:	Dr. David Ebsworth	 
	Title: 	Chairman	 
	 	 
	 	 
	/s/
    Mark Hahn	 
	Mark Hahn	 

 

     

     

    

 

 

Exhibit C

 

Indemnification Agreement

 

(attached)

 

     

     

    

 

DIRECTOR DEED OF INDEMNITY

 

THIS DEED OF INDEMNITY is made the
1 day of February 2020.

 

BETWEEN:

 

		(1)	Verona Pharma plc, a public limited company registered in England and Wales with company number
05375156 whose registered office is at One Central Square, Cardiff, United Kingdom, CF10 1FS (the “Company”);
and

 

		(2)	Mark Hahn of XXXXXXXXX (the
                                                                                                                  “Indemnified     Person”).

 

WHEREAS

 

		(A)	The Indemnified Person
is a director of the Company.

 

		(B)	The Company has agreed to indemnify the Indemnified Person on the terms and conditions set out
in this Deed.

 

		(C)	The Company has further agreed to maintain appropriate directors’ and officers’ liability
insurance for the benefit of the Indemnified Person.

 

NOW THIS DEED WITNESSETH as follows:

 

		1.	INDEMNITY

 

		1.1	Subject to Clauses 1.2 and 6.1 of this Deed, the Company shall, to the fullest extent permitted
by law and without prejudice to any other indemnity to which the Indemnified Person may otherwise be entitled, indemnify and hold
the Indemnified Person harmless in respect of all claims, actions and proceedings, whether civil, criminal or regulatory (“Claims”),
and any losses, damages, penalties, liabilities, compensation or other awards arising in connection with any such Claims (“Losses”),
whether instigated, imposed or incurred under the laws of England and Wales or the law of any other jurisdiction and arising out
of, or in connection with, the actual or purported exercise of, or failure to exercise, any of the Indemnified Person’s powers,
duties or responsibilities as a director or officer of the Company or any of its subsidiaries (as defined in section 1159 of the
Companies Act 2006, as amended (the “Companies Act”)) and including any modification or re-enactment of it for
the time being in force) for the time being, subject to the remaining provisions of this Deed.

 

     

     

    

 

		1.2	The indemnity in Clause 1.1 above shall be deemed not to provide for, or entitle the Indemnified
Person to, any indemnification that would cause this Deed, or any part of it, to be treated as void under the Companies Act and,
in particular, except as provided in Clause 1.3 of this Deed, shall not provide directly or indirectly (to any extent) any indemnity
against:

 

		(a)	any liability incurred by the Indemnified Person to the Company or any associated company (as defined
in section 256 of the Companies Act) (“Associated Company”); or

 

		(b)	any liability incurred by the Indemnified Person to pay a fine imposed in criminal
                                                               proceedings or a sum payable to a regulatory authority by way of a penalty in respect of non compliance by the Indemnified
                                                               Person with any requirement of a regulatory nature (however arising); or

 

		(c)	any liability incurred by the Indemnified Person:

 

		(i)	in defending any criminal proceedings in which such Indemnified Person is convicted;

 

		(ii)	in defending any civil proceedings brought by the Company, or an Associated Company, in which judgment
is given against such Indemnified Person; or

 

		(iii)	in connection with any application under section 661(3) or (4) or section 1157 of the
Companies Act in which the court refuses to grant him relief,

 

where, in any such case, any such
conviction, judgment or refusal of relief has become final. Reference in this Clause 1.2 to a conviction, judgment or refusal of
relief being “final” shall be construed in accordance with sections 234(4) and (5) of the Companies Act.

 

		1.3	Without prejudice to the generality of the indemnity set out in Clause 1.1 above, the Company shall,
to the fullest extent permitted by law, indemnify and hold the Indemnified Person harmless on an “as incurred” basis
against all legal and other costs, charges and expenses reasonably incurred or to be incurred:

 

		(a)	in defending Claims including, without limitation, Claims brought by, or at the request of, the
Company or any Associated Company and any investigation into the affairs of the Company or any Associated Company by any judicial,
governmental, regulatory or other body; or

 

		(b)	in connection with any application under section 661(3) or (4) or section 1157 of the
Companies Act,

 

provided that, in accordance
with section 205 of the Companies Act, the Indemnified Person agrees that any such legal and other costs, charges and expenses
paid by the Company shall fall to be repaid, or any liability of the Company under any transaction connected thereto shall fall
to be discharged, not later than:

 

		(c)	in the event of the Indemnified Person being convicted in the proceedings, the date when the conviction
becomes final;

 

		(d)	in the event of judgment being given against the Indemnified Person in the proceedings, the date
when the judgment becomes final; or

 

     

     

    

 

		(e)	in the event of the court refusing to grant the Indemnified Person relief on the application, the
date when the refusal of relief becomes final.

 

References in this Clause 1.3
to a conviction, judgment or refusal of relief being 'final' shall be construed in accordance with sections 205(3) and (4) of
the Companies Act.

 

		2.	claiming under the indemnity

 

		2.1	The Indemnified Person shall give written notice to the Company as soon as reasonably practical
after receipt of any demand relating to any Claims (or becoming aware of circumstances which are reasonably be expected to give
rise to a demand relating to Claims) giving full details and providing copies of all relevant correspondence and the Indemnified
Person shall keep the Company fully informed of the progress of any Claims, including providing all such information in relation
to any Claims or Losses or any other costs, charges or expenses incurred as the Company may reasonably request, and shall take
all such action as the Company may reasonably request to avoid, dispute, resist, appeal, compromise or defend any Claims.

 

		2.2	For the avoidance of doubt:

 

		(a)	if a company ceases to be a subsidiary of the Company after the date of this Deed, the Company
shall only be liable to indemnify the Indemnified Person in respect of liabilities in relation to that company which arose before
the date on which that company ceased to be a subsidiary of the Company; and

 

		(b)	the Indemnified Person, as director or manager of any company which becomes a subsidiary of the
Company after the date of this Deed, shall be indemnified only in respect of liabilities arising after the date on which that company
became a subsidiary of the Company.

 

		3.	Term

 

This Deed shall remain in force
until such time as any relevant limitation periods for bringing Claims against the Indemnified Person have expired, or for so long
as the Indemnified Person remains liable for any Losses, notwithstanding that such Indemnified Person may have ceased to be a director
or officer of the Company or any of its subsidiaries.

 

		4.	Directors’ and Officers’ insurance

 

The Company shall provide and
maintain appropriate “directors and officers” liability insurance (including ensuring that premiums are properly paid)
for the benefit of the Indemnified Person for so long as any Claims may lawfully be brought against the Indemnified Person.

 

     

     

    

 

		5.	governing law AND JURISDICTION

 

This Deed and any non-contractual
rights or obligations arising out of or in connection with it shall be governed by, and interpreted in accordance with, the laws
of England and Wales. Each of the Company and the Indemnified Person irrevocably agree that the courts of England and Wales shall
have exclusive jurisdiction to settle any Disputes (as defined below) and waive any objection to proceedings before such courts
on the grounds of venue or on the grounds that such proceedings have been brought in an inappropriate forum. For the purposes
of this Clause 5, “Dispute” means any dispute, controversy, claim or difference of whatever nature arising
out of, relating to, or having any connection with this Deed, including a dispute regarding the existence, formation, validity,
interpretation, performance or termination of this Deed or the consequences of its nullity and also including any dispute relating
to any non-contractual rights or obligations arising out of, relating to, or having any connection with this Deed.

 

		6.	GENERAL

 

		6.1	If this Deed is finally judicially determined in a relevant jurisdiction to provide for, or entitle
the Indemnified Person to, indemnification against any Claims or Losses that would cause this Deed, or any part of it, to be treated
as void under the laws of that jurisdiction, this Deed shall, in so far as it relates to such jurisdiction, be deemed not to provide
for, or entitle the Indemnified Person to, any such indemnification, and the Company shall instead indemnify the Indemnified Person
against any Claims or Losses to the fullest extent permitted by law in that jurisdiction.

 

		6.2	A person who is not a party to this Deed shall have no right under the Contracts (Rights of Third
Parties) Act 1999 to enforce any of its terms.

 

IN WITNESS whereof this Deed has
been executed the day and year first above written.

 

	EXECUTED and delivered	)	 
	 	 	 
	as a DEED by	)	 
	 	 	 
	VERONA PHARMA PLC	)	 
	 	 	 
	acting by	)	/s/ Dr. David Ebsworth
	 	 	 
	a director, in the presence of:	)	Director

 

 

	/s/
SG	 	Signature of Witness	 
	 	 	 	 
	Shelley George 	 	Name of Witness	 
	 	 	 	 
	XXXXXXXXX	 	Address of Witness	 
	 	 	 	 
	XXXXXXXXX	 	Occupation of Witness	 

 

     

     

    

 

	SIGNED as a DEED by	)	 
	Mark Hahn	)	/s/ Mark Hahn
	in the presence of:	)	 

 

	/s/
Linda J. Hahn	 	Signature of Witness	 
	 	 	 	 
	Linda J. Hahn	 	Name of Witness	 
	 	 	 	 
	XXXXXXXXX	 	Address of Witness	 
	 	 	 	 
	XXXXXXXXX	 	Occupation of WitnessExhibit
10.7

 

Agreement
for the provision of investment Management Services for Mutual Funds

 

Made
and entered into in Tel Aviv on 5th of April, 2020

 

	Between:	Modelim
    Mutual Funds Ltd.
	 	 
	 	of
    7 Menachem Begin Str. Ramat Gan
	 	 
	 	(hereinafter:
    the “Fund Manager”)

 

Of
the first part;

 

	And:	Yetsira
    Investment House Ltd. private company no. 515552495
	 	 
	 	(hereinafter:
    the “Investment Manager”)

 

Of
the second part;

 

	Whereas	the
    Fund Manager is a company engaged in the management of mutual funds in Israel, in accordance with the provisions of the Joint
    Investment Trust Law, 5754-1994 (hereinafter: the “Joint Investment Law”); and
	 	 
	Whereas	the
    Investment Manager wishes to provide Services through its employees to the Fund Manager, for the mutual funds which are established
    by the Fund Manager and/or which are transferred to its management and the guiding principles of whose investment policy,
    as will be revised from time to time, are attached as Annex “A” to this Agreement (hereinafter, the “Fund/Funds”);
    and
	 	 
	Whereas	in
    order to provide the investment Management Services to the Mutual Funds, subject to the provisions of the Joint Investment
    Law and the Law to Regulate Engagement in Investment Consultancy Investment Marketing and Investment Portfolio Management,
    5755-1995 (hereinafter, the “Law”), the Investment Manager undertakes to hold a valid license as a portfolio manager;
    and
	 	 
	Whereas	the
    Investment Manager is authorized to manage investment portfolios and to provide investment marketing Services, subject to
    the provisions of the Law; and
	 	 
	Whereas	the
    Fund Manager wishes to engage in the Agreement to be provided with such investment Management Services, subject to the Investment
    Manager being duly authorized to engage in investment management, and all subject to the provisions of all laws and subject
    to the provisions of a power of attorney given and/or to be given by the Trustee to the Fund Manager;

 

    	 

    	2

    

 

Now
therefore, it is hereby agreed, declared and stipulated between the parties as follows:

 

	1.	Preamble
	 	 	 
	 	1.1	The
    Preamble and Annexes to this Agreement constitute an integral part hereof.
	 	 	 
	 	1.2	The
    division of this Agreement into chapters and annexes, and the assignment of headings to the chapters and annexes thereof,
    is for convenience purposes only and is not be used for the purpose of interpretation.
	 	 	 
	 	1.3	All
    the terms contained in this Agreement, which are defined in the Joint Investment Law and/or the Law and/or the directives
    of the Tel Aviv Stock Exchange Ltd. will be interpreted as defined in the Law and/or in the relevant directive, and in case
    of inconsistency, the definition provided in the Joint Investment Law will prevail.
	 	 	 
	 	1.4	This
    Agreement constitutes a contractual engagement for the management of the Fund’s investment portfolios by the Investment
    Manager, and therefore both it and the Services provided and to be provided by the Investment Manager under this Agreement,
    are subject to all provisions of the Law, unless determined otherwise in this Agreement, and provided that such stipulation
    is permitted under the provisions of the Law.
	 	 	 
	 	1.5	Everything
    stated in this Agreement will apply to each of the Funds to be managed by the Investment Manager in accordance with the provisions
    of this Agreement, and unless specifically stated otherwise in this Agreement.

 

	2.	The
    Investment Manager declares that it meets all legal requirements applicable on the execution date of this Agreement with respect
    to its engagement as mentioned above; that it is authorized to execute this Agreement and that such execution does not contradict
    any other agreement and/or obligation to which it is a party; and it undertakes to meet the requirements of the law required
    for its operations, throughout the term of the Agreement.
	 	 
	3.	The
    undertakings of the Investment Manager and the Investment Management Services Provider

 

The
Investment Manager undertakes as follows:

 

	 	3.1.1	That
    the Investment Manager is a company engaged in the management of investment portfolios and holds portfolio management license
    No. 772 and will hold such license for as long as the Investment Manager provides the portfolio Management Services to the
    Fund Manager and undertakes in accordance with the law, to be the holder of a portfolio management license for the purpose
    of providing such Services. If, for any reason whatsoever, the Investment Manager ceases to hold a portfolio management license
    during the term of this Agreement, it undertakes to give notice thereof to the Fund Manager, as soon as possible.
	 	 	 
	 	3.1.2	That
    both it and its employees who will be engaged in managing the Funds’ investment portfolios, are and will be familiar,
    throughout the term of this Agreement with the provisions of the Law which apply to the activities which are the subject of
    this Agreement.
	 	 	 
	 	3.1.3	That
    it is the responsibility of the Investment Manager to provide the Services which are the subject of this Agreement, in accordance
    with the conditions of the Agreement and of any law which applies to the management of a Mutual Investment Fund.

 

    	 

    	3

    

 

	 	3.1.4	That
    it is not aware of any possible conflict of interest between its own interests and/or the interests of anyone acting on its
    behalf, and the interests of the Fund Manager and/or the Funds being managed by the Fund Manager.
	 	 	 
	 	3.1.5	That
    it is authorized to execute this Agreement and that such execution does not contradict any other agreement and/or obligation
    to which it is a party. That it undertakes to meet the requirements of the law required by its engagement, including being
    the holder of a license, prior to the date of providing investment Management Services to the Funds (and it is clarified
    that being a license holder is a condition of its providing investment Management Services to the Funds) and for as long as
    investment Management Services are being provided by it.
	 	 	 
	 	3.1.6	That
    no disciplinary and/or criminal proceedings have been and/or are now being managed against it and/or against any of its employees,
    by any legally competent authority, and it is not aware of any intention to initiate any such proceedings, in relation to
    the Services which are the subject of this Agreement.
	 	 	 
	 	3.1.7	That
    there have been no findings [against it], in the course of being audited by a legally competent authority, and if any such
    were to be found during the term of the Agreement, that they will immediately be referred to the Fund Manager for investigation.
	 	 	 
	 	3.1.8	That
    it is a corporation controlled by Creations Inc. which is controlled by Guy Nisenson, Ilan Arad-Keshet, Amit Hezi Bilia, Shmuel
    Yelshevich and has a connection with the following financial assets: Mutual Funds numbered 5124268, 5127964, 5127292, 5124243,
    5124227, 5130232, and is not aware of proceedings being conducted against any of its owners of control which could have an
    effect on the contractual engagement in this Agreement. In addition, the Investment Manager undertakes to immediately notify
    the Fund Manager of any change that may apply to the information set out in this section.
	 	 	 
	 	3.2	The
    restrictions regarding investment in personal accounts by virtue of the law that applies to employees of the Fund Manager,
    the members of the investment committee at the Fund Manager and anyone employed by the Fund Manager who is actively involved
    in taking decisions regarding securities held in the Funds, will apply to anyone who is employed by the Investment Manager
    to provide the Services which are the subject of this Agreement and the Fund Manager will be responsible for the fulfillment
    of these obligations;
	 	 	 
	 	3.3	For
    the avoidance of doubt, it is clarified that prior to the date of starting to provide the investment Management Services to
    the Funds that are subject of this Agreement and for the duration of the period in which the Services are provided to the
    Fund Manager as stated in this Agreement, the Investment Manager and its employees who will actually provide the Management
    Services will be licensed to manage investment portfolios, in accordance with the Law;
	 	 	 
	 	3.4	For
    the avoidance of doubt, it is clarified that there will be no employer-employee relationship, for all intents and purposes,
    between the employees of the Investment Manager who are engaged in providing the Services that are the subject of this Agreement,
    and the Fund Manager, and the Services provided through the Investment Manager by its employees. The Investment Manager is
    entitled to engage employees to provide the Services that are the subject of this Agreement, at its expense (subject to the
    issuancee of the consideration for the Services as determined in section 7 hereunder), and provided that the employees who
    are engaged by the Investment Manager and who participate in decision making on the investment of the Fund’s assets,
    have the licenses required to manage the investment portfolios, and provided that they comply with the legal requirements
    regarding anyone who is employed by a fund manager and who participates in making decisions regarding securities held in the
    Funds, as they will be from time to time.

 

    	 

    	4

    

 

	 	3.5	The
    Fund Manager will be responsible for carrying out the daily management of the Fund including the preparation and issue of
    interim reports, notifications under the law, preparing and publishing annual statements and Fund prospectuses, transferring
    information to the Stock Exchange and to the Securities Authority and ongoing communications with them, administering the
    board of directors and the investment and other committees, and any other applicable duty in connection with the management
    of the Fund.
	 	 	 
	 	 	The
    Investment Manager will assist the Fund Manager and provide reasonable cooperation in the ongoing management of the Fund including
    appearing at any authority and/or signing, in a reasonable manner, any document, subject to any law and/or transferring information
    in a reasonable manner.
	 	 	 
	 	 	In
    the context of providing the Services, the Investment Manager will be responsible for the daily administration of the Fund’s
    assets, including, inter alia, taking investment decisions, giving instructions regarding purchases, sales, creating
    and exercising option letters, converting securities, etc. (hereinafter, the “Management Services”), subject to
    the decision of the Fund Manager’s Investment Committee and board of directors, the Fund Manager’s policies, the
    provisions of the Fund Agreement, the Fund’s prospectus/annual report and the provisions of any law, and under the supervision
    of the Fund Manager.
	 	 	 
	 	3.6	The
    Investment Manager will be responsible for adopting a procedural policy for the selection of investments and the manner in
    which they are to be administered (hereinafter, the “Investment Management Procedure”) which is based on the Fund
    Manager’s policy for selecting and administering investments. This procedure will constitute an annex to the Fund Manager’s
    procedure and will be approved in accordance with the provisions of the law.
	 	 	 
	 	3.7	For
    the avoidance of doubt, if the holding, purchase or sale of any security by one of the Funds to which the Investment Manager
    is providing Management Services, requires, under the Investment Management Procedure, the provision of a document on which
    the action is to be made, including an analysis and rating, the Investment Manager will be responsible for providing the Fund
    Manager, in the context of managing the Fund’s assets, with any such document, and all in accordance with the Investment
    Management Procedure.
	 	 	 
	 	3.8	For
    the purpose of realizing this Agreement, the Fund Manager will provide the Investment Manager with any document required to
    manage the investments in order to implement this Agreement, whether or not the document is shown on the MAGNA site and which
    includes directives for the investment.

 

    	 

    	5

    

 

	 	3.9	The
    Investment Manager will provide the Fund Manager with the names of those who are authorized to sign on its behalf to issue
    such investment directives, to amend them and in the event that the Fund Manager requires specific provisions or consents.
	 	 	 
	 	3.10	The
    Fund Manager will notify the Investment Manager of changes in the investment policy and/or in the investment guidelines and
    the Investment Manager will take action to carry out the actions required by the notification of a change, immediately or
    in accordance with date on which the change comes into effect. Any change to the Investment Policy will implemented as stated
    in section 13 hereunder.
	 	 	 
	 	3.11	The
    Investment Manager may, and, if requested to do so, will be required, to send a representative on its behalf to meetings of
    the Investment Committee, which discuss the Funds which are the subject of this Agreement, in accordance with invitations
    issued by the Fund Manager, as required to do so and at least once each quarter. This representative will not have a voting
    right and will not be counted in a quorum of those attending meetings of the Investment Committee. Without derogating from
    the aforesaid, the Fund Manager will be authorized to bar the presence of the Investment Manager’s representative if
    the issues to be discussed at such meetings are not related to the Funds and/or are issues which are protected by commercial
    confidentiality, and subject to it sending to the Investment Manager, the decision of the Investment Committee which concerns
    the management of the Funds..
	 	 	 
	 	3.12	If
    the Fund Manager’s board of directors determines, in a procedure approved by the Trustee, the conditions on which securities
    are to be acquired for the Funds in a public offering under a prospectus, including in a connected issue, as defined by law,
    the Investment Manager may, subject to complying with the conditions laid down in such procedure, perform the transactions,
    subject to its undertaking to provide a written report to the Fund Manager regarding the implementation of such transactions,
    which will be deemed to be a transaction which the board of directors has reviewed as stated in the provisions of the Joint
    Investment Law.
	 	 	 
	 	 	Any
    transaction performed outside the Stock Exchange and/or any order in an issuance as an institutional investor, including with
    respect to securities which are not connected to the Fund Manager, will only be implemented subject to the Fund Manager’s
    procedure for special transactions.
	 	 	 
	 	3.13	Subject
    to the provisions of all laws, the names of the Funds will bear the name of the Investment Manager.
	 	 	 
	 	3.14	Without
    derogating from the generality of the aforesaid, the Investment Manager undertakes to comply with the Fund Manager’s
    procedures as determined by the Fund Manager’s board of directors from time to time, and to comply with the monitoring
    procedures and to act in accordance therewith. The Investment Manager will, in a reasonable manner, conduct routine daily
    monitoring of the Fund’s investments, as required by the Fund Manager including but not limited to the preparation of
    reports and daily statements as requested by the Fund Manager.

 

    	 

    	6

    

 

	4.	The
    Term of the Agreement

 

	 	4.1	 
	 	 	 
	 	4.2	The
    provisions of the Agreement regarding the provision of investment Management Services to the Funds, as detailed above, will
    come into effect on the date of transferring management of the Funds to the Fund Manager and when new Funds are established,
    this Agreement will apply to them as of the date of their establishment and will remain in effect until terminated in the
    manner specified in section 9 hereunder, or until cancelled in some other way.
	 	 	 
	 	4.3	For
    the avoidance of doubt, and in addition to that stated in section 9 regarding the termination of the Agreement, it is clarified
    that if the Agreement lapses, the Investment Manager will bear all the costs of the measures that the Fund Manager is required
    to adopt to prepare the new Funds, including legal consultancy costs etc, and the Investment Manager will have no right and/or
    right of claim or demand against the Fund Manager.

 

	5.	Additional
    undertakings and declarations

 

	 	5.1	The
    Investment Manager does not undertake to achieve any minimum return or any return for the Fund and the Investment Manager
    is not liable vis à vis the Fund Manager and/or those holding units in the Fund for losses that are incurred from the
    Investment Manager’s activities, provided that the Investment Manager’s activity does not include a breach of
    any law and/or agreement and/or a negligent act.
	 	 	 
	 	5.2	The
    Fund Manager and the Investment Manager declare and confirm that they are aware that this Agreement and the Services provided
    by virtue thereof, are subject to the supervision and instructions of the Securities Authority.
	 	 	 
	 	5.3	The
    Investment Manager undertakes to enable the Enforcement Commissioner, the Compliance Officer, the Internal Auditor and/or
    any other person appointed for such purpose by the Fund Manager, to carry out audits at its offices by prior coordination
    and in normal working hours, regarding the management of the Funds’ investments which are the subject of this Agreement.
    The Investment Manager and its employees undertake to assist in the implementation of audits as required.
	 	 	 
	 	5.4	The
    Investment Manager undertakes to update the Fund Manager, immediately and in writing, of any event in respect of which the
    Fund Manager is or may be required to report according to the provisions of the Legislative Regulation.

 

    	 

    	7

    

 

	 	5.5	The
    Fund Manager declares that it is aware that the duty of absolute confidentiality to which the Investment Manager is subject
    regarding all information brought to its attention by the Fund Manager, including the documents and their contents made available
    to it, and any other details relating to the Investment Manager’s work for the Fund Manager, is subject to the Investment
    Manager’s duty to provide information and reports under any law, and the Investment Manager undertakes to provide the
    Fund Manager with prior written notice of any such demand to provide information as far as it is able to do so by law.
	 	 	 
	 	5.6	The
    Investment Manager undertakes to act in accordance with the Fund’s investment policy and the guidelines of the Fund
    Manager’s Investment Committee, as they may be from time to time. If the Investment Manager deviates from the investment
    policy and/or the guidelines, it must rectify the deviation in accordance with the dates set out in the Funds Law or the Investment
    Committee’s directives, as the case may be. Any change in the investment policy compared with what is detailed in Annex
    “A” hereunder, will be made as stated in section 13 hereunder.
	 	 	 
	 	5.7	Without
    derogating from the overall obligation of the Investment Manager to provide the Services subject to the provisions of the
    law, the Investment Manager hereby undertakes not to perform the transactions in securities included in section 67 of the
    Funds Law and/or which require the approval of the Fund Manager’s board of directors as stated in section 60 of the
    Funds Law and in the Joint Investment Regulations (Transactions that May Entail Conflicts of Interest and Material Transactions)
    5755-1995 (hereinafter, the “Regulations”), or any other transaction the performance of which is subject to restrictions
    imposed on it by virtue of legal provisions that will apply from to time or by virtue of the directives of the Fund Manager’s
    board of directors or the Investment Committee or a trustee, other than in accordance with the Special Transactions Procedure
    and Securities Lending Procedure and the short selling thereof performed by the Fund Manager, and all subject to the Fund
    Manager providing it with details of the parties which are related to the Fund Manager or to the Trustee of the Funds managed
    by the Fund Manager, in accordance with the provisions of section 67 of the Funds Law and the procedures and/or the guidelines,
    in advance and in writing. It is clarified that the transfer of such lists is a condition of the external Investment Manager’s
    compliance with this section with regard to the implementation of outside Stock Exchange transactions and/or transactions
    which are directly coordinated, not through a broker who refuses to disclose details of a third party to the transaction between
    the Fund and such related party. In addition and without derogating from the aforesaid, the restrictions and obligations applicable
    to the Fund Manager by virtue of the Regulations will also apply to the Investment Manager and whenever the words “Fund
    Manager” are stated in the Regulations the words “Fund Manager and/or Investment Manager” will be deemed
    to be stated. The Investment Manager will not perform transactions in futures and short-selling and/or in loan activities
    and/or credit operations and/or any other investment activity requiring the provision of guarantees against such investment
    activity, other than subject to the Investment Committee’s decision and in accordance with the restrictions set out
    by the Investment Committee regarding the Fund’s exposure and the levels of security, as they will from time to time.
    The Investment Manager undertakes that it will not perform transactions in options, other than in accordance with the Investment
    Committee’s written instructions issued to the Fund Manager, subject to the investment policy established by the Fund
    Manager’s board of directors in the Fund prospectus and/or the Fund Manager’s report.

 

    	 

    	8

    

 

	 	5.8	Without
    derogating from any of the aforesaid obligations, the Investment Manager undertakes to report to the Fund Manager in writing,
    with regard to all transactions performed outside the Stock Exchange or a regulated market and/or coordinated transactions
    which the Investment Manager has carried out in accordance with the procedure for special transactions adopted by the Fund
    Manager.
	 	 	 
	 	5.9	Each
    party undertakes that if its operations are sold or transferred or if its shares are sold or control therein is transferred
    to a third party, it will give prior, written notice thereof to the other party. However, during the term of exclusivity under
    the Letter of Intent (LOI) dated February 20, 2020 between Creation and Yetsira Capital Markets Models and the creation of
    the capital markets models, each party undertakes that it will not sell its activities nor transfer or sell its shares or
    transfer control therein to a third party, other than a transfer to a company controlled by the controlling shareholders in
    which the other party’s rights to the Agreement are not prejudices as a result.
	 	 	 
	 	5.10	The
    Investment Manager declares that it is aware of the fact that the Fund Manager will have exclusive discretion regarding its
    engagement in distribution agreements with different distributors with respect to Funds in which investments are managed by
    the Investment Manager, both with regard to the entities with which the Fund Manager chooses to engage and the terms of the
    engagement.
	 	 	 
	 	5.11	The
    Investment Manager declares that it is aware that in respect of the Funds Law and the Regulations promulgated by virtue thereof,
    the Investment Manager and its employees who are engaged in the provision of investment Management Services which are the
    subject to this Agreement will be regarded as a “party which is related” to the Fund Manager, and that it is aware
    of the reporting obligations which apply to parties which are related to the Fund Manager, as stated in Joint Investment Trust
    Regulations. (Reporting), 5754-1994, and the provisions of section 49 of the Funds Law with respect to holdings by related
    parties, and that it or the parties acting on its behalf to whom the said obligations apply, will act in accordance with such
    obligations.
	 	 	 
	 	5.12	The
    Investment Advisor will not publish any advert for a Fund or distribute, in any way, any material and/or information about
    the Fund, whether directly or indirectly, to any party whatsoever, unless it has obtained the explicit written approval of
    the Fund Manager and the Trustee. The Fund Manager will be entitled to object to any voluntary publication relating to the
    Funds, without being required to give reasons therefor.
	 	 	 
	 	 	For
    the purpose of this Section: “advert” – any publication of any kind, including as defined in section 73
    of the Funds Law, either verbal, written or printed, by electronic means or online (including via blogs, talkbacks, Twitter,
    Facebook, You Tube), and/or by email, including conference calls, painting, image, movement, sound, and any other means, which
    are directed at third parties.

 

    	 

    	9

    

 

	 	5.13	The
    Fund Manager will provide the Investment Manager with the information and data required to fulfill its role and its undertakings
    under this Agreement and in accordance with the law, including investment data, with the Fund Manager’s Funds and with
    the procedures under section 3.2 above.
	 	 	 
	 	5.14	The
    Investment Manager will be entitled to market the Funds, subject to the provisions of the law as applicable from time to time,
    and including subject to the provisions of the law and of this Agreement which relate to advertising, arranging conferences,
    the provisions of the distribution agreements relating to meetings with advisors at banks.
	 	 	 
	 	5.15	The
    Investment Manager declares that an investment selection process will be held in accordance with the investment management
    procedure set out in section 3.6 above.

 

	6.	Providing
    Information and its retention by the Investment Manager

 

	 	6.1	The
    Investment Manager declares that it is aware that the information and/or data which is provided to the Investment Manager
    will also be held, in whole or in part, on computerized data bases by the Investment Manager, provided that it manages such
    databases in accordance with the law.
	 	 	 
	 	6.2	Subject
    to the provisions of all law, the parties undertake to keep confidential and to keep secure the information in their possession
    relating to this Agreement and to the Services to be provided under this Agreement. The parties are aware that the Fund Manager’s
    duty of confidentiality is subject to its legal duty to provide information to a competent authority both in an ongoing manner
    and when required to do so, and the Investment Manager hereby consents to such information being provided.
	 	 	 
	 	6.3	The
    Investment Manager declares that it is aware that the Fund Manager is subject to the requirement to provide details regarding
    the contractual engagement outlined in this Agreement and the Funds which are the subject of this Agreement in the Funds’
    prospectus and in immediate reports as provided in the Funds Law and in the Regulations by virtue thereof, and, inter alia,
    to provide such details to the Fund Manager’s board of directors, the Fund Trustee and to the Securities and Exchange
    Authority and any entity and/or other authority in accordance with the provisions of any law.

 

	7.	Waiver
    of a breach

 

	 	7.1	A
    waiver by the parties of any prior breach or noncompliance with one or more of their obligations under this Agreement will
    not be deemed justification or excuse for a further breach or for noncompliance with any of the terms and conditions of this
    Agreement, and the refraining by either party from exercising any right conferred upon it pursuant to the terms of this Agreement,
    will not be construed as a waiver of such right.
	 	 	 
	 	7.2	No
    waiver by either party, no compromise or other arrangement, to the extent this Agreement is concerned, will be binding upon
    the parties unless made in writing.

 

    	 

    	10

    

 

	8.	Consideration
    for the Management Services and expenses

 

	 	8.1	Definitions

 

	 	8.1.1	“The
    Fixed Amount”: A sum of NIS.1,350 to the Fund Manager (hereinafter, the “Fixed Amount to the Fund Manager”)
    and a sum of NIS.2,650 (+ VAT) to the company Modellim Capital Markets (hereinafter, the “3rd Party”),
    at the directive of the Fund Manager, for the Services provided on its behalf to the Fund (including auditing, inspection
    and administrative Services) (hereinafter, the “Fixed Amount for the 3rd Party”), per month.
	 	 	 
	 	8.1.2	Variable
    monthly costs: a sum to reflect the annual costs of operating the Fund divided by 12 (Annex “B”):

 

	 	●	On-going
    payments for the Yetsira Funds to the lawyer who is appointed by the Fund Manager ;
	 	 	 
	 	●	Payment
    of the Fund Manager’s prospectus license fee ;
	 	 	 
	 	●	All
    statutory and voluntary advertising (provided that the Investment Manager agrees to such voluntary advertising ;
	 	 	 
	 	●	Annual
    distribution commission to Stock Exchange ;
	 	 	 
	 	●	Annual
    commission to the Securities Authority ;
	 	 	 
	 	●	Ongoing
    payment to the outside, professional entity chosen by the Fund Manager to participate at general meetings;
	 	 	 
	 	●	Ongoing
    payment to Entropy for monitoring the debt of bond issuers in Israel. The cost of the service will be divided equally between
    the Fund Manager and all external investment managers who choose to join the service.
	 	 	 
	 	●	The
    Fund’s operating fee as is, in accordance with the Fund Manager’s operating agreement with the Operator;
	 	 	 
	 	●	Brokerage
    fees if the Fund Manager is responsible for such fees; if the Fund Manager has global responsibility for operating Services
    and/or performance fees, the Investment Manager will bear the cost in the same proportion as the proportion of the assets
    which are included in the Funds to the total scope of assets in the mutual fund managed by the Fund Manager ;
	 	 	 
	 	●	Internal
    auditing costs in respect of the auditing hours ascribed to a Fund managed by an outside investment manager;
	 	 	 
	 	●	Fund
    Manager’s insurance costs are attributed to a Fund only when the overall scope of the assets managed by the Fund Manager
    exceeds NIS.500 M (based on a total amount of insurance costs, divided by the extent of the assets managed in the Funds managed
    by the Fund Manager and multiplied by the total of the assets in the Funds which are the subject of this Agreement) ;
	 	 	 
	 	●	Payments
    for irregular meetings of the board of directors and its committees which are convened at the request of a Fund’s Investment
    Manager or for a regulatory requirement emanating from the Funds for which the Investment Manager provides investment Management
    Services.
	 	 	 
	 	●	Any
    additional/other directly related expense which is not included in direct costs as defined hereunder.

 

Variable
monthly costs will be calculated on the basis of estimating the annual cost of expenses as stated above, and divided by 12

 

    	 

    	11

    

 

	 	8.1.3	“Direct
    Costs”: fee for unit creation and distribution commission to banks.
	 	 	 
	 	8.1.4	“Investment
    Manager’s Revenues”: the total remaining out of the fund management fees and the increment rate after deduction
    of the Fixed Amount, the variable monthly cost and the direct costs relating to the Fund.
	 	 	 
	 	8.1.5	Without
    derogating from the generality of the aforesaid, in order to secure future payments that have not been anticipated, and to
    comply with this Agreement, the Investment Manager will deposit a check in the sum of NIS.50,000 from Yetsira Holdings Ltd.
    This check will be returned to the Investment Manager at the end of 18 months after the termination of this Agreement as stated
    in section 9 hereunder. However, to the extent that no merger takes place in accordance with the conditions of the Letter
    of Intent (LOI) dated 20.02.2020 by Creation and Yetsira Capital Markets Models, and if the consolidated equity of Creation
    Inc. is less than NIS.1 million, the Investment Manager will convert the security check into a bank check in the sum of NIS.50,000.
	 	 	 
	 	8.2	At
    the end of each year of the engagement, and up to February 28 of the following year, a final and exhaustive reckoning will
    be made of the Variable Monthly Costs against the actual cost for that year, and an adjustment for credit or further charge
    will be made in the first calendar month after the end of the year. At the end of each year of the engagement, the parties
    will review the Variable Monthly Costs for the Fund and adjust the Variable Monthly Costs accordingly, for the following year.
	 	 	 
	 	8.3	The
    Investment Manager will be entitled to all Investment Management Revenues, as defined in Section 8.1.4.
	 	 	 
	 	8.4	Payment
    of the consideration will be made as follows: from the monthly revenue from the management fees and the increment rate for
    the Fund (hereinafter, the “Fund’s Revenues”), the Fund Manager will pay the Direct Costs that have actually
    been paid during each calendar month and/or which are required to be paid for that month and the Variable Monthly Costs, and
    will transfer the balance, less the Fixed Amount for the Fund Manager, to the Investment Manager.
	 	 	 
	 	 	From
    the amount transferred to the Investment Manager, the Investment Manager will transfer the Fixed Amount for the 3rd
    Party, as instructed by the Fund Manager.
	 	 	 
	 	 	It
    is clarified that, if, by the actual payment date, as specified in Section 8.5, the Fund Manager does not have precise data
    regarding the Fund’s revenues and costs, the total amount of the Fund’s revenues and costs for calculating the
    consideration to the Investment Manager will be in accordance with the Fund Manager’s estimate based on the previous
    payment month. On the next payment date, a final and full reckoning will be made in accordance with the Fund Manager’s
    actual income for that month.

 

    	 

    	12

    

 

	 	8.5	Payment
    to the Investment Manager will be made by the Fund Manager by no later than the 10th of each calendar month, for the previous
    month, subject to providing a transaction invoice to the Fund Manager in respect of managing the Fund’s investments
    and providing a transaction invoice to 3rd Party as instructed by the Fund Manager. The Investment Manager will
    transfer the Fixed Amount to the 3rd Party within 5 business days from the date on which the Fund Manager makes
    the payment to the Investment Manager. It is clarified that, if the Investment Manager not provide such invoices in respect
    of the preceding month, the Fund Manager will delay making payment until such invoices are received.
	 	 	 
	 	8.6	 
	 	 	 
	 	8.7	If
    there is insufficient Fund revenue in the Funds to which the Services which are the subject of this Agreement are provided,
    from management fees and the rate of increment, to cover the Direct Costs the Fixed Amount, and the Variable Monthly Costs,
    the Fund Manager will be entitled to collect the shortfall from the Investment Manager’s revenues for other Funds managed
    under this Agreement. And if the revenues from management fees and the rate of increment from all Funds whose investments
    are managed by the Investment Manager are not enough, the Investment Manager will transfer to the Fund Manager, the amount
    of the difference to which the Fund Manager is entitled, from its own resources, by no later than 14 days from the date on
    which it was so notified.
	 	 	 
	 	8.8	If
    the Investment Manager does not act as stated in section 8.7 above, and if the Fund Manager is entitled to a security check
    as stated in section 8.1.5 above, the Fund Manager may realize the security check and/or the bank check as cover for the amount
    that is owed, and failure to pay the Fund Manager will be deemed as grounds for the immediate termination of the Agreement
    as provided in section 9.1.5 below, when the Investment Manager has not covered the debt within an additional 30 days, and
    the Fund Manager may notify the Investment Manager of the termination of the Agreement in such circumstances. The Investment
    Manager will have the opportunity to bring the issue of the financial value of the assets transferred from it, to an arbitrator
    to be agreed upon between the parties.
	 	 	 
	 	8.9	VAT
    will not be added to such payments, other than the portion of the Fixed Amount payable to 3rd Party in respect
    of which VAT is to be added, and if there is legal requirement to pay VAT, it will apply to the Investment Manager, and be
    paid at its expense.

 

    	 

    	13

    

 

	 	8.10	The
    Investment Manager will be given the right to review the Fund’s ledgers of checking the revenue from management fees,
    incremental rate and expenses that have been outlaid. The confirmation of the Fund’s auditor regarding such revenue
    and expenses will constitute final and agreed evidence with regard to the Fund Manager’s revenues and the expenses outlaid.
	 	 	 
	 	8.11	In
    addition, and without derogating from the aforesaid, it is agreed that the Investment Manager will bear all costs in setting
    up new mutual funds issued by the Fund Manager, even before starting to provide Management Services. Mutual fund establishment
    expenses include payment of the Fund’s attorney’s fees, fees for filing and publishing a prospectus, charges to
    the Stock Exchange, statutory publications relating to the Funds, the costs of convening meetings of the board of directors
    and/or the investment committees (only in the event of such meeting being convened for a special purpose) on the agenda of
    which is the approval of the submission of Funds’ prospectuses to the Securities Authority.
	 	 	 
	 	8.12	It
    is clarified that the date for commencing the provision of investment Management Services is a date that is not the start
    of a calendar month, the consideration for the Management Services will be paid for a full month, including the Variable Monthly
    Costs, and not for the relative part of the month in which the Services are provided.

 

	9.	Term
    of the Agreement

 

	 	9.1	Subject
    to what is stated in section 4 above, the Term of the Investment Agreement is for an unlimited period of time.
	 	 	 
	 	 	Without
    derogating from the aforesaid, the commencement of the provision of management investment Services by the Investment Manager
    to the Funds, is conditioned on receiving the confirmation of the Fund Manager’s board of directors therefor, and, in
    respect of Funds which are to be transferred to the Investment Manager from another fund manager, the publication of an immediate
    report transmitted by the Fund Manager on the MAGNA System, regarding the contractual engagement between the Fund Manager
    and the Investment Manager relating to the provision of investment management systems to the Funds.

 

Termination
of the Agreement by the Fund Manager:

 

	 	9.1.1	In
    addition to that stated in section 4.3 above regarding termination of the Agreement in the event that that the Investment
    Manager fails to acquire a license, and in accordance with the provisions of the Law, the Agreement may be terminated immediately
    by the Fund Manager at any time without giving reasons, in respect of each of the Funds for which Services are to be provided
    under this Agreement, individually, and/or by way of terminating this Framework Agreement in its entirety, and the provisions
    of section 10.1 of this Agreement will apply with regard to termination.
	 	 	 
	 	9.1.2	Circumstances
    of Termination in Special Cases

 

	 	9.1.2.1	In
    addition to the aforesaid, in any event where an action by the Investment Manager or any of its employees relating to the
    Fund constitutes a breach of the provisions of the Law and/or the Funds Law and/or the Regulations enacted by virtue thereof
    and/or in the event of a deliberate action which constitutes a criminal offense under the provisions of the Law and/or the
    Funds Law and/or the Securities Law, or a breach which amounts to an administrative violation, the Fund Manager may decide
    to terminate the Agreement immediately, and in which case the Fund will remain under the Fund Manager’s management and
    the provisions of section 10.1 below will not apply.

 

    	 

    	14

    

 

	 	9.1.2.2	In
    addition to the aforesaid, in the event of an indictment being served against the Investment Manager or against an Investment
    Manager employee, for offenses relating to the Law and/or the Funds Law and/or the Securities Law and/or the Regulations enacted
    thereunder, and if the Investment Manager has not removed (and, in the event of an indictment against an Investment Manager
    employee, done so immediately after the filing of the indictment) such employee from dealing with the management of Fund investments,
    the Fund Manager may decide to terminate the Agreement immediately, and the Fund will remain under the Fund Manager’s
    management, and the provisions of section 10.1 below will not apply.

 

	 	9.1.3	In
    addition, and without derogating from the provisions of section 4.3 above, in any event where there is an amendment to the
    provisions of any law and/or the directives of the Authority stating that there is to be no lawful contractual engagement
    between the parties under the terms of this Agreement, according to a legal opinion received by the Fund Manager, and/or in
    any event where there is an amendment to the provisions of any law determining that a material change is required to the terms
    of this Agreement, the parties will discuss the change to the terms of the Agreement. If the parties do not reach an understanding,
    the Agreement may be terminated immediately by wither party and the provisions of section 10 hereunder will apply, as the
    case may be.
	 	 	 
	 	9.1.4	In
    addition to the aforesaid, in the event that the Investment Manager transfers its shares to an entity with which the Fund
    Manager is in competition, other than in the case where the Investment Manager transfers its shares to an entity controlled
    by its controlling shareholder, as stated in section 5.7 above, the Fund Manager may decide to terminate the Agreement immediately.
    In such a case, the Investment Manager will not be entitled to any financial compensation and/or payment after the date on
    which the notice of termination is given.
	 	 	 
	 	9.1.5	In
    addition and without derogating from the aforesaid in section 4.3 above, in the event that the Investment Manager cannot,
    for any reason whatsoever, provide the Management Services as stated in this Agreement, for a period which exceeds 7 consecutive
    days or for a cumulative period of 30 days in a period of 12 months, for reasons relating to the Investment Manager, and such
    reasons are not related to the Fund Manager, and/or in the event of the Investment Manager’s liquidation or a discontinuation
    of its activities, or in the event that there is an outstanding balance due by the Investment Manager to the Fund Manager
    as stated in section 8.8 above, and/or the Investment Manager fails to provide bank guarantees as detailed in section 8, the
    Fund Manager will be entitled to terminate the Management Agreement after giving the Investment Manager 7 days prior notice.
    In the event that the Investment Manager fails to remedy the breach, the Fund will remain under the management of the Fund
    Manager and the provisions of section 10.1 will not apply (in this context see the provisions of section 10.4).

 

    	 

    	15

    

 

	 	9.2	Termination
    by the Investment Manager: In any event of termination of the Agreement by the Investment Manager during the first 12
    months of operation under this Agreement, the Investment Manager will pay the Fund Manager a one-off sum of NIS.10,000 + VAT
    thereafter. The Investment Manager may give the Fund Manager notice of terminating the Agreement by prior notice of at least
    60 days (hereinafter, the “Prior Notice”).
	 	 	 
	 	9.3	In
    any event of termination of the Agreement, other than if specifically agreed otherwise, the provisions of section 10 hereunder
    will apply, as the case may be.

 

	10.	Provisions
    in the event of termination of the Agreement

 

	 	10.1	In
    the event that the Agreement is terminated by the Fund Manager in accordance with section 9.1.1 above, the Agreement will
    be terminated immediately and unless notified otherwise by the Investment Manager, and subject to the following, the Fund
    will continue to be managed the Fund Manager. It is clarified that in such a case the Investment Manager will be entitled
    to its share of the consideration set out in section 8 for an additional, limited period of 60 days from the date of termination
    of the Agreement (hereinafter, the “Liquidated Damages”). Notwithstanding the aforesaid, to the extent that the
    provisions of the law, including the directives of the Securities Authority, allow the Funds to be transferred to the management
    of another fund manager, the Investment Manager will be entitled to instruct the Fund Manager, within 30 days from the date
    on which notification of the termination of the Agreement is given, to whom the Funds are to be transferred, provided that
    the transferee is a company engaged in the management of mutual funds which has been approved by the Chairman of the Securities
    and Exchange Commission and which undertakes to be responsible for paying all distribution commissions to all distributors
    of the Funds’ units which are to be transferred for its management and subject to the agreement of the Fund’s
    Trustee (hereinafter, the “Transfer Notice”), and subject to payment of the Investment Manager’s debts to
    the Fund Manager, if any, as set forth in Section 8 above, or to a debt settlement arrangement in another manner, which is
    to the satisfaction of the Fund Manager. If the Funds are not transferred to another fund manager as stated above, within
    30 days from the date of the Transfer Notice, the Funds will continue to be managed by the Fund Manager without any claim
    and/or suit and/or demand by the Investment Manager.
	 	 	 
	 	 	Notwithstanding
    the foregoing, to the extent that it is not possible to transfer the management of the Funds to another Fund Manager in accordance
    with the above timetable, either as a result of statutory provisions which are not known as at the date of signing this Agreement
    or as a result of directives from the Securities and Exchange Authority or another authority, which are not known as at the
    date of signing this Agreement, the Investment Manager will then be granted, subject to any law, an appropriate extension
    to transfer the Funds to another fund manager.

 

    	 

    	16

    

 

	 	10.2	In
    the event that the Agreement is terminated by the Investment Manager in accordance with section 9.2 above:

 

	 	10.2.1	The
    Investment Manager may instruct the Fund Manager, by up to 30 days prior to the end of the Prior Notice Period, to transfer
    the Funds to another fund manager, provided that the transferee is a company engaged in the management of mutual fund approved
    by the Chairman of the Securities Authority, and which undertook to be responsible for the payment of distribution commission
    to all distributors for units of the Funds to be transferred into its management and subject to the consent of the Fund Trustee.
    If such funds have not been transferred into the management of another fund manager within 60 days of the date of the Transfer
    Notice as defined in this section, the Funds will remain under the management of the Fund Manager without any claim and/or
    suit and/or demand by the Investment Manager.
	 	 	 
	 	10.2.2	The
    transfer of the Funds to the transferee as stated above will be implemented by way of an agreement amending the Fund Agreement.
    The Fund Manager undertakes not to abstain from signing such an amendment agreement other than for reasons relating to the
    ineligibility of the transferee to act as a fund manager. Such transfer will be made without payment to the Fund Manager by
    the transferee manager. The Investment Manager will act with the transferee fund manager to change the name of the Fund in
    such a manner that it will not be identified with the Fund Manager pursuant to this Agreement, It is clarified that the Investment
    Manager will be responsible for all of the Fund Manager’s costs relating to the transfer of the Funds to the management
    of another fund manager.
	 	 	 
	 	10.2.3.	In
    the event that the Investment Manager gives notice of the termination of the Agreement and does not instruct the Fund Manager
    to transfer the Funds into the management of another mutual fund management company, as stated in clauses 10.2.1-10.2.2 above,
    the Investment Manager will be responsible for making a payment to covers the Fund Manager’s expenses (including all
    costs arising from terminating the Agreement, including the costs of dissolving the Funds, splitting the Funds or the costs
    of merging the Funds with other mutual funds and/or any other cost, if it is decided at the Fund Manager’s sole discretion
    of the Fund Manager to take any of the aforesaid actions, and if there are any such expenses) relating directly and/or indirectly
    from the Termination Notice. If the Fund Manager continues to manage the Funds, the Investment Manager will not be responsible
    for any costs whatsoever.
	 	 	 
	 	10.2.4	For
    as long as the provisions of section 22 of the Funds Law stating that a single portfolio manager may not provide investment
    Management Services to two fund managers at the same time, do not change, the Investment Manager may, in the event of termination
    of this Agreement by the Fund Manager in respect of a specific Fund, instruct that all Funds managed according to this Agreement,
    be transferred to another fund manager at its sole discretion. If such demand is granted, the parties will, in good faith,
    do everything required to implement the transfer of the management of the funds, including approaching the Trustee for his
    approval of the said transfer.

 

    	 

    	17

    

 

	 	10.3.	In
    the event the Agreement is terminated in the circumstances set out in section 9.1.2 above, the Fund Manager may immediately
    terminate this Agreement. The Fund Manager will enable the Investment Manager to appear before the board of directors, and
    the Investment Manager will not be entitled to transfer the Funds to another fund manager or to receive Liquidated Damages
    and/or any payment whatsoever, after the date of the Termination Notice, unless and subject to the Fund Manager’s agreement
    and on the conditions (including with regard to the Fund Manager’s compensation) determined by the Fund Manager. The
    Investment Manager will have the option of bringing the issue of the financial value of the assets transferred from it, to
    an arbitrator to be agreed upon by the parties.
	 	 	 
	 	10.4	In
    the event that the Agreement is terminated by the Fund Manager in accordance with section 9.1.5 above, the Agreement will
    be terminated immediately unless notice to the contrary is given by the Investment Manager, and subject to the following,
    and the Fund will remain under the management of the Fund Manager. It is clarified that in such event, the Investment Manager
    will not be entitled to the Liquidated Damages as defined in Section 10.1, as determined in section 8, from the date of terminating
    the Agreement. Notwithstanding the aforesaid, to the extent that legal provisions, including the Securities Authority’s
    directives, permit the transfer of Funds to be managed by another fund manager, the Investment Manager may instruct the Fund
    Manager within 60 days from the date of the Termination Notice of the Agreement to transfer the Funds, provided that the transferee
    is a company engaged in the management of mutual funds and has been approved by the Chairman of the Securities and Exchange
    Commission and has undertaken to be responsible for the payment of distribution commission to all distributors for the Fund
    units that are to be transferred for its management, and which has undertaken liability for the Investment Manager’s
    obligations to the Fund Manager, if any, as provided in section 8 above, or a debt settlement arrangement in another manner
    which is to the satisfaction of the Fund Manager and subject to the consent of the Fund Trustee.

 

	11.	Indemnification,
    insurance professional liability and maintaining confidentiality

 

	 	11.1.	The
    Investment Manager undertakes that the Services to the Fund Manager which are the subject of this Agreement will be provided
    subject to the provisions of the legislative arrangements applicable to the Investment Manager and relating to the management
    of the Fund’s assets and/or the Investment Manager’s publications and/or to the use of credit by the Mutual fund
    and/or the provisions of the Fund’s investment policy as detailed in the Fund Prospectus and/or immediate reports which
    will be in effect from time to time and/or the provisions of this Agreement.

 

    	 

    	18

    

 

	 	11.2	In
    addition, and without derogating from what is stated in this Agreement regarding payments and liquidated damages, the Investment
    Manager undertakes to indemnify the Fund Manager in full, out of its own resources, for any direct damages and/or costs incurred
    by the Fund Manager, including pursuant to administrative or other proceedings, including for compensation to unit holders
    and/or to a Fund and/or to any third party, including as a result of a claim by such unit holders and/or third parties and/or
    in accordance with a ruling by a competent authority regarding such indemnification, and all whether the damage is related
    to and/or arises from, either directly or indirectly, the Services provided by the Investment Manager to the Fund Manager
    pursuant to this Agreement, including all the costs of lawyers’ fees which are incurred as a result of an act and/or
    omission by the Investment Manager and/or by anyone acting on its behalf in contravention of the applicable law, including
    a deviation from the regulations which apply to a mutual fund and to the management of the investment of the Fund’s
    assets and/or voluntary advertising and/or use of credit by a mutual fund, and/or the provisions of the Fund’s investment
    policy as set forth in the Fund’s prospectus as will be in effect from time to time and/or a deviation from the provisions
    of this Agreement. The Investment Manager will not be liable for errors and/or deviations arising from a negligent action
    by the Fund Manager, unless the Investment Manager is partially at fault..
	 	 	 
	 	11.3.	In
    addition, the Investment Manager undertakes to indemnify the Fund Manager for any payment which the Fund Manager has outlaid
    for costs incurred by the Fund Manager due to a claim or suit or demand that is brought up to establish the subsistence of
    an employer-employee relationship between the Fund Manager and the Investment Manager employees and/or anyone employed by
    the Investment Manager in providing the Services that are the subject of this Agreement. The provisions of section 11.2 hereunder
    will apply in respect of the indemnification mechanism.
	 	 	 
	 	 	It
    is hereby agreed that the obligations to indemnify as stated above will remain in effect for 3 years after the termination
    of this Agreement for any reason, and this for the period in which this Agreement was to be in effect.
	 	 	 
	 	11.4.	Each
    party undertakes to notify the other party in writing immediately that it becomes aware that a legal proceeding has been initiated
    against one of the parties in order to allow that party to take the measures required to have such proceeding cancelled. In
    addition, and without derogating from the aforesaid, the party that may be liable for indemnification will be entitled to
    accept responsibility for dealing with such claim and/or demand and/or payment of such fine, upon first being notified by
    the other party of the filing of such claim and/or demand and/or demand for payment of a fine, and the injured party will
    cooperate with the party that may be liable to indemnify, as far as possible in managing the proceedings. Compensation will
    be paid within 14 days from the final date for filing an appeal against the order to pay compensation to the injured parties
    as stated above, or within 14 days from the date on which a final and conclusive ruling regarding an appeal and/or such claim
    is given.
	 	 	 
	 	11.5	If
    an event occurs that entitles the Fund Manager to indemnification and compensation from the Investment Manager, for damage
    caused to it, as set out in section 11.1 above, the Fund Manager may offset the amount of compensation or indemnification
    owing to it, from the Investment Manager’s revenue, as detailed in section 8, to which the Investment Manager is entitled.

 

    	 

    	19

    

 

	 	11.6	The
    Investment Manager undertakes that at any time from starting to provide the Services under this Agreement up until the termination
    of the Agreement, it will be insured for professional liability insurance covering the Services provided under this Agreement,
    in accordance with the provisions of the Law, and will provide the Fund Manager, at its request, with confirmation by an accountant
    or the insurer regarding the existence of the insurance and the level of insurance coverage as stated above.
	 	 	 
	 	11.7	Each
    party and anyone employed by it under this Agreement undertakes to maintain the confidentiality of all aspects of this Agreement,
    the information they hold regarding the provisions of this Agreement and the Fund in respect of which the Services which are
    the subject of this Agreement are provided, and/or of the other party, and will sign a letter of confidentiality in the form
    attached as Annex “B” to this Agreement.
	 	 	 
	 	11.8	In
    any proceeding as stated in section 11.1 above, the Fund Manager will provide the Investment Manager with applications, complaints,
    audit reports, claims and/or any other document addressed to the Fund Manager which includes a claim against the Investment
    Manager, and will enable him to join the proceeding or provide its response within a reasonable time.

 

	12.	Absence
    of Third Party Rights

 

	 	12.1	It
    is hereby expressly agreed that nothing in this Agreement will constitute a contract to the benefit of a third party nor does
    it confer any rights upon any third party, including and without derogating from the generality of the above, purchasers of
    units in the Funds.
	 	 	 
	 	12.2	Notwithstanding
    what is stated in section 12.1, the Fund Manager may assign its rights and/or obligations under this Agreement to a third
    party which is a company authorized by the Securities Authority and which is controlled by the Fund Manager’s controlling
    shareholder.

 

	13.	The
    Fund Manager undertakes that any change in its promotion of the Fund Agreement relating to the investment policy, the Fund
    Manager’s remuneration, the rate of increment, a merger and/or splitting of the Fund, and any other issue which represents
    a fundamental change in the terms of this Agreement, other than the transfer of the Fund to another fund manager – as
    stated in section 12.2, and/or a decision regarding the dissolving of the Fund – will be made after consulting with
    the Investment Manager and will take its views into consideration, subject to the provisions of all laws.

 

	14.	Jurisdiction

 

	 	14.1	Sole
    and exclusive jurisdiction over all differences and disputes between the parties regarding this Agreement and its implementation
    will be given to the authorized courts of Tel Aviv.
	 	 	 
	 	14.2	The
    parties’ addresses for delivering notices are as detailed in the preamble to the Agreement, unless one party gives written
    notice to the other of a changed address stating that such address will be the new address to which it is to be notified.

 

	15.	This
    Agreement constitutes a framework agreement regarding the provision of investment Management Services by the Investment Manager
    to the Funds managed by the Fund Manager, and its provisions will apply in respect of any Fund which is included in Annex
    “A” hereunder, as that will be amended from time to time.
	 	 
	16.	Signing
    on this Agreement will come into effect subject to the confirmation of the Fund Manager’s board of directors.

 

In
consideration whereof, the parties have signed

 

	 	 	 
	Fund
    Manager	 	Investment
    Manager

 

    	 

    	20

    

 

Annex
“A” Details of the Funds

 

	Security Number	 	Fund Name
	5130232	 	Yetsira Debenture without shares
	5127972	 	Yetsira 10/90
	5124243	 	Yetsira 20/80
	5124227	 	Yetsira 30/70
	5127964	 	Yetsira Shares
	5124268	 	Yetsira Flexible
	 	 	 

 

    	 

    	21

    

 

Annex
“B” Variable Costs

 

All
amounts correct as at 01.01.2020

 

	Fixed Monthly Cost in NIS	 	Fund Value in NIS	 	Fund Value in NIS

From 50,000,001 to	 	Fund Value in NIS
	 	 	Up to 50,000,000	 	 250,000,000	 	Above 250,000,000
	Payment to lawyer (Prospectus, Annual Report and Ongoing Reports: 6500 + VAT per Fund	 	634	 	634	 	634
	Annual Fee to Stock Exchange: 7385 + Vat per Fund	 	720	 	720	 	720
	Annual license fee for Fund Manager Prospectus: 4250 per Fund	 	354	 	354	 	354
	Annual Fee to Securities Authority (according to size of Fund)	 	1925	 	2343	 	2928
	Total of fixed monthly costs	 	3633	 	4051	 	4636

 

Direct
and Randomly Variable Costs

 

	Distribution
    commission to banks	 	According
    to fund type- maximum 0.35%
	Operational
    cost to the operating bank	 	0.025%,
    according to Fund value
	Stock
    Exchange Fees	 	In
    respect of activities in securities in accordance with section 6 of the revised Stock Exchange price list
	Correspondent
    Charges	 	In
    respect of activity in foreign securities at the bank’s price list
	Commission
    for Generation	 	0.03%
    for each NIS. generated
	Participation
    in payment to professional entity for participating in general meetings	 	Monthly
    payment to such entity (NIS.3,000 + VAT) divided by the number of Funds under the management of the Fund company
	Participation
    in payment to professional entity for reviewing debt of securities distributors in Israel	 	Monthly
    payment to such entity (NIS.2,500 + VAT) divided by the number of Funds under the management of the Fund company
	Setting
    up a committee for special investment for the Fund at the request of the external fund manager	 	Inviting
    1 director – a cost of about NIS.1,500 (including VAT). Cost of a meeting by phone, about NIS.900 (including VAT)
	Setting
    up a special committee for re-evaluation/special transactions at the request of the external fund manager and/or as required
    by law	 	Inviting
    at least 2 directors – a cost of about NIS.4,500 (including VAT). Cost of a meeting by phone, about NIS.1,800 (including
    VAT)
	Holding
    a special meeting of the board of directors at the request of the Fund’s external investment manager and/or as required
    by law	 	Inviting
    at least 2 directors – a cost of about NIS.3,000 (including VAT). Cost of a meeting by phone, about NIS.2,700 (including
    VAT)
	Advertising
    in newspapers for the Fund	 	ongoing
    advertising according to size

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