IN THE HIGH COURT OF JUSTICE CHANCERY DIVISION COMPANIES COURT

BEFORE MR JUSTICE DAVID RICHARDS

Dated: 23 January 2014

No. 7321 of 2013

IN THE MATTER OF XENETIC BIOSCIENCES PLC AND IN THE MATTER OF THE COMPANIES ACT 2006

ORDER

UPON THE APPLICATION by Part 8 Claim Form dated 22 October 2013 of Xenetic Biosciences Plc (the "Company") whose registered office is situated at London Bioscience Innovation Centre, 2 Royal College Street, London NWl ONH.

AND UPON HEARING Counsel for the Company.

AND UPON READING the said Claim Form and the evidence.

AND UPON General Sales & Leasing, Inc. appearing by Counsel for the Company, being also its respective Counsel for this purpose, submitting to be bound by the scheme of arrangement hereinafter sanctioned and undertaking to the Court to be bound thereby and to execute or procure to be executed all such documents and to do or procure to be done all such acts or things as may be necessary or desirable to be executed or done by it or on its behalf for the purpose of giving effect to the said scheme of arrangement.

THE COURT HEREBY SANCTIONS the scheme of arrangement as set forth in Schedule 1 hereto in accordance with the provisions of the Companies Act 2006 (the "Act").

THE COURT HEREBY ORDERS that the reduction of the capital of the Company resolved on and effected by a special resolution passed at a general meeting of the Company held on 17 December 2013 be and the same is hereby confirmed in accordance with the provisions of the Act.

AND THE COURT HEREBY APPROVES the statement of capital set forth in Schedule 2 hereto.

AND IT IS ORDERED that this Order be produced by the Company to the Registrar of Companies and that the Company deliver an office copy hereof to him together with a copy of the said statement of capital.

AND THIS COURT DIRECTS pursuant to Section 650 of the Act that the Registrar of Companies do register this Order insofar as it confirms the reduction of capital of the Company notwithstanding the fact that the effect of this order is to reduce the issued share capital of the Company below the authorised minimum.

AND IT IS ORDERED that notice of the registration by the Registrar of Companies of this Order and of the said statement of capital be published by the Company in "The Times" newspaper within 21 days after such registration.

SCHEDULE

SCHEME OF ARRANGEMENT

PART 4

THE SCHEME OF ARRANGEMENT

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION COMPANIES COURT

No 7321 of 2013

IN THE MATIER OF XENETIC BIOSCIENCES PLC

and

IN THE MATIER OF THE COMPANIES ACT 2006

SCHEME OF ARRANGEMENT

(under Part 26 of the Companies Act 2006) between

XENETIC BIOSCIENCES PLC

and

THE HOLDERS OF SCHEME SHARES

(as hereinafter defined)

PRELIMINARY

(A)                In this Scheme, the following expressions have the meanings stated, unless they are Inconsistent with the subject or context:

(B)                References to "clauses" are to clauses of this Scheme and references to time are to London time. Any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof.

(C)                GSL has agreed to be represented by Xenetic's counsel at the Court Hearing, to consent to the Scheme and to undertake to the Court to be bound thereby and to execute and do, or procure to be executed and done, all such documents, acts and things as may be necessary or desirable to be executed or done by It or on its behalf for the purpose of giving effect to this Scheme.

(D)                As at the date of this document GSL does not hold, and no member of the GSL Group holds, any Shares.

(E)                The provisions of this Scheme are subject to the Court confirming the Reduction of Capital and, accordingly, they may not be Implemented until a certified copy of the Court Order (together with a statement of capital has been delivered to, and registered by, the Registrar of Companies.

THE SCHEME

1.     Cancellation of the Scheme Shares

1.1                 The share capital of the Company shall be reduced by cancelling and extinguishing all of the Scheme Shares.

1.2                 Subject to and forthwith upon the said Reduction of Capital taking effect, and notwithstanding anything to the contrary In the Company's articles of association, the reserve arising In the books of account of the Company as a result of the said Reduction of Capital shall be capitalised and applied In paying up In full at par such number of New Shares as shall be equal to the number of Scheme Shares cancelled pursuant to clause 1.1 of this Scheme, which shall be allotted and issued credited as fully paid (free from all liens, charges, equitable Interests and encumbrances) to GSL and/or Its nominee(s).

2.     Consideration for cancellation of the Scheme Shares

2.1                 In consideration of the cancellation of the Scheme Shares pursuant to clause 1.1 of this Scheme and the allotment and Issue to GSL and/or its nominee(s) of the New Shares, GSL shall, contingently upon the Reduction of Capital provided for in clause 1.1 of this Scheme taking effect (and subject as hereinafter provided) In accordance with clause 5 of this Scheme, issue to each holder of Scheme Shares (as appearing In the register of members of the Company at the Scheme Record Time):

for every 176 Scheme Shares: 56 GSL Consideration Shares

2.2           The provisions of this clause 2 of the Scheme shall be subject to any prohibition or condition Imposed by law.

3.     Certificates and cancellation

With effect from and including the Effectwe Date, all certfficates representing Scheme Shares shall cease to have effect as documents of title or to be valid for any purpose and each holder of Scheme Shares shall be bound at the request of the Company to deliver up the same to the Company or to any person nominated by the Company for cancellation or to destroy the same.

4.     Settlement

4.1                 In the case of Scheme Shares which at the Scheme Record Time are held in certificated form, any GSL Consideration Shares to which Shareholders are entitled pursuant to the Scheme will be issued on the Effective Date. Certificates for the GSL Consideration Shares will be despatched by post no later than 14 days after the Effective Date in prepaid envelopes addressed to the persons thereto entitled at their respective addresses, as appearing In the register of members of Xenetic at the Scheme Record Time (or, in the case of joint holders, to the address of that joint holder whose name stands first In the said register In respect of such joint holding).

Pending the despatch of certificates for GSL Consideration Shares, temporary documents of title will not be issued and transfers of GSL Consideration Shares in certificate form will be certified against the register of GSL. Every holder of Xenetic Shares will be bound at the request of Xenetic to deliver up to Xenetic the existing certificate(s) for cancellation or to destroy the certificate(s). Euroclear will also be instructed to cancel the entitlements to Xenetic Shares cancelled as part of the Scheme.

4.2                 In the case of Scheme Shares which at the Scheme Record Time are held in uncertificated form, GSL will procure that Scheme Shareholders will be issued any GSL Consideration Shares to which he or she Is entitled In certificated form In the same way as set out in clause 4.1 above.

4.3                 The provisions of this clause 4 of this Scheme shall take effect subject to any prohibition or condition imposed by law or regulation.

5.     The Effective Date

5.1                This Scheme and Reduction of Capital, which it includes, shall become effective in accordance with its terms as soon as the following shall have occurred, In the following order, that:

5.2                Unless this Scheme shall become effective on or before 5.00 p.m. London time on 30 June 2014 (or such later date, if any as GSL and the Company may agree and the Court may allow), this Scheme shall never become effective.

6. Modification

GSL and the Company may jointly consent, on behalf of all persons affected, to any modification of, or addition to, this Scheme or to any condition approved or imposed by the Court.

Dated: 21 November 2013

SCHEDULE

STATEMENT OF CAPITAL