Execution
Copy
PATENT SECURITY
AGREEMENT
WHEREAS, FORTICELL BIOSCIENCE,
INC ., a Delaware
corporation (" Grantor "), owns the Patents and Patent
Applications listed on Schedule 1 annexed hereto, and is a party to
the Patent Licenses listed on Schedule l annexed hereto;
and
WHEREAS , Grantor and Paul Royalty Fund, L.P., a
Delaware limited partnership (" Grantee "), are parties to
an Agreement dated as of September 22, 2008 (the " Sale
Agreement "), pursuant to which, among other things, Grantee is
selling, assigning, transferring and conveying to Grantor, and
Grantor is purchasing from Grantee, all of Grantee's Securities (as
defined in the Sale Agreement);
WHEREAS , pursuant to the terms of the Security
Agreement dated as of September 22, 2008 (the " Security
Agreement ;" all capitalized terms defined in the Sale
Agreement or the Security Agreement and not otherwise defined
herein have the respective meanings provided for in the Sale
Agreement or the Security Agreement), between Grantor and Grantee,
Grantor has granted to Grantee a security interest as contemplated
by the Security Agreement, including, without limitation, all
right, title and interest of Grantor in, to and under all now owned
and hereafter acquired Patents, Patent applications and Patent
Licenses, and all products and proceeds thereof (to the extent
granted therein), to secure payment and performance of Grantor's
obligations under the Sale Agreement and the other
Obligations;
NOW, THEREFORE , for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Grantor
does hereby grant to Grantee a continuing security interest in all
of Grantor's right, title and interest in, to and under the
following (all of the following items or types of property being
herein collectively referred to as the " Patent Collateral
"), whether presently existing or hereafter created or
acquired:
(1)
each U.S. Patent and Patent
application included in the Intellectual Property, including,
without limitation, each Patent and Patent application referred to
in Schedule l annexed hereto, together with any reissues,
continuations or extensions thereof, and all of the goodwill of the
business conducted in the U.S. connected with the use of, and
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