1.
|
DEFINITIONS
|
2.
|
PURPOSE
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3.
|
ADMINISTRATION
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4.
|
SHARES
SUBJECT TO PLAN
|
5.
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ELIGIBILITY
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6.
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PRICE
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7.
|
PERIOD
OF OPTION AND RIGHTS TO
EXERCISE
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8.
|
NON-TRANSFERABILITY
OF OPTION
|
9.
|
TERMINATION
OF EMPLOYMENT
|
10.
|
DEATH
OF OPTIONEE
|
11.
|
ADJUSTMENTS
IN SHARES SUBJECT TO
PLAN
|
12.
|
AMENDMENT
AND TERMINATION OF THE
PLAN
|
|
(a)
|
the
maximum number of Shares reserved for issuance under the Plan (and
under
any other share compensation arrangements of the
Company);
|
|
(b)
|
a
reduction in the exercise price for options held by
insiders;
|
|
(c)
|
an
extension to the term of options held by insiders;
and
|
|
(d)
|
the
increase in the 10% limits on grants to insiders set out in Section
3 and
any shareholder approval required in respect of an amendment to
increase
such limits shall exclude the votes attaching to Shares, if any,
held by
Optionees who are insiders.
|
13.
|
EFFECTIVE
DATE OF THE PLAN
|
14.
|
EVIDENCE
OF OPTIONS
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15.
|
APPROVAL
|
1.1.
|
Purpose
of the Plan
|
1
|
1.2.
|
Definitions
|
1
|
1.3.
|
Schedules
|
1
|
1.4.
|
Headings
and Table of Contents
|
1
|
1.5.
|
Gender
and Number
|
1
|
1.6.
|
Currency
|
1
|
1.7.
|
Invalidity
of Provisions
|
2
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1.8.
|
Entire
Agreement
|
2
|
1.9.
|
Governing
Law
|
2
|
1.10.
|
Effective
Date
|
2
|
ARTICLE 2.
|
||
ADMINISTRATION
|
||
2.1.
|
Administration
by the Board of Directors
|
2
|
2.2.
|
Authority
of the Board of Directors
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2
|
2.3.
|
Grants
by CEO
|
3
|
2.4.
|
Shares
Subject to the Plan
|
3
|
2.5.
|
Restrictions
on Issuances
|
3
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2.6.
|
Compliance
with Law
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4
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ARTICLE
3.
|
||
FAIR
VALUE
|
||
3.1.
|
Definition
|
4
|
ARTICLE 4.
|
||
GRANT
OF OPTIONS
|
||
4.1.
|
Grants
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5
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4.2.
|
Participation
Voluntary
|
5
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4.3.
|
General
Terms of the Option
|
5
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4.4.
|
Option
Exercise Price
|
5
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4.5.
|
Exercise
Period of Option
|
5
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4.6.
|
Option
Agreements
|
6
|
4.7.
|
Prohibition
on Transfer of Options
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6
|
ARTICLE
5.
|
||
EXERCISE
OF OPTIONS
|
||
5.1.
|
Method
of Exercise of Option
|
7
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5.2.
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Payment
of Option Price
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7
|
5.3.
|
Withholding
of Tax
|
7
|
ARTICLE
6.
|
||
SHARES
|
||
6.1.
|
Shareholder
Rights
|
8
|
ARTICLE 7.
|
||
REORGANIZATIONS
AND ADJUSTMENTS
|
||
7.1.
|
Reorganization
or Sale of the Company
|
8
|
7.2.
|
Substitute
Options upon Acquisition by the Company
|
8
|
7.3.
|
Capital
Adjustments
|
8
|
ARTICLE 8.
|
||
EMPLOYMENT
AND COMPENSATION
|
||
8.1.
|
No
Special Employment Rights
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9
|
8.2.
|
Other
Employee Benefits
|
9
|
8.3.
|
Non-Exclusivity
|
9
|
ARTICLE 9.
|
||
AMENDMENTS
|
||
9.1.
|
Amendment
or Termination Without Consent
|
9
|
9.2.
|
Amendment
With Individual Consent
|
10
|
ARTICLE 10.
|
||
GENERAL
MATTERS
|
||
10.1.
|
Notices
|
10
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10.2.
|
Submission
to Jurisdiction
|
10
|
10.3.
|
Language
of Plan
|
11
|
10.4.
|
Further
Assurances
|
11
|
Schedule 1.2.1
|
- |
Definitions
|
Schedule 1.2.2
|
- |
Incorporated
Definitions
|
Schedule 2.2.5
|
- |
Regulations
|
Schedule 2.6.4
|
- |
Company
Obligations Required By Law
|
Schedule 4.6
|
- |
Form
of Option Agreement
|
Schedule 5.1
|
- |
Exercise
Form
|
Schedule 1.2.1
|
- |
Definitions
|
Schedule 1.2.2
|
- |
Incorporated
Definitions
|
Schedule 2.2.5
|
- |
Regulations
|
Schedule 4.6
|
- |
Form
of Option Agreement
|
Schedule 5.1
|
- |
Exercise
Form
|
1.
|
“Affiliate”
has the meaning given to that term in National Instrument
45-106.
|
2.
|
“Associate”
has the meaning given to that term in the Securities Act
(Ontario).
|
3.
|
Black
Out Period” means any period during which a policy of the Company
prevents an Insider from trading in the
Shares.
|
4.
|
“Board”
means the board of directors of the Company or a committee of the
board of
directors appointed to administer the
Plan.
|
5.
|
“Business
Day” means any day, other than Saturday, Sunday or any statutory
holiday in the Province of Ontario.
|
6.
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“Cause”,
in respect of a Participant, either
|
|
6.1.
|
has
the meaning given to that term in any written employment or consulting
agreement between the Company or an Affiliate and the Participant
or in
any written employment policy or manual of the Company or an Affiliate
applicable to the Participant, or
|
|
6.2.
|
if
there is no written definition of this term applicable to the Participant,
means (1) the wilful failure of the Participant to properly carry out
the Participant’s duties and responsibilities or to adhere to the polices
of the Company or its Affiliates after notice by the Company (or
an
Affiliate) of the failure to do so and an opportunity for the Participant
to correct the failure within a reasonable period from the date
of receipt
of that notice, (2) fraud, theft, dishonesty or wilful misconduct by,
or the gross incompetence of, the Participant involving the property,
business or affairs of the Company or its Affiliates or the carrying
out
of the Participant’s duties, as determined in good faith by the Company
and (3) any other conduct that would constitute cause as that term is
interpreted by the courts of the Province of Ontario from time
to
time.
|
7.
|
“Combination”
means any acquisition of the Company by means of any transaction
or series
of related transactions, including any consolidation, merger, amalgamation
or similar form of corporate reorganization, (1) in which the
outstanding shares of the Company are exchanged for securities
or other
consideration issued, delivered or caused to be issued or delivered,
by
the acquiring Person, its subsidiary or other Person and (2) under
which the holders of the outstanding voting securities of the Company
immediately prior to the transaction fail to hold, directly or
indirectly,
equity securities representing a majority of the voting power of
the
Company or surviving entity or its parent immediately following
the
transaction in substantially the same proportions as their ownership
of
the voting power of the equity securities of the Company immediately
prior
to the transaction.
|
8.
|
“Company”
means Lorus Therapeutics Inc., and includes any successor
company.
|
9.
|
“Consultant”
has the meaning given to that term in National Instrument 45-106 and
excludes an individual whose services are in connection with the
offer or
sale or securities of the Company in a capital raising
transaction.
|
10.
|
“Consultant
Entity” means, for an individual Consultant, a company of which
the individual Consultant is an employee or shareholder or a partnership
of which the individual Consultant is an employee or
partner.
|
11.
|
“Control"
(or “Controlled”) has the meaning given to that term in National
Instrument 45-106.
|
12.
|
“Disability”,
in respect of a Participant, either
|
|
12.1.
|
has
the meaning given to that term in any written employment or consulting
agreement between the Company or an Affiliate and the Participant
or in
any written employment policy or manual of the Company or an Affiliate
applicable to the Participant, or
|
|
12.2.
|
if
there is no written definition of this term applicable to the Participant,
means, subject to applicable human rights law, the mental or physical
state of the Participant resulting in the Participant being unable
as a
result of illness, disease, mental or physical disability or similar
cause, as determined by a legally qualified medical practitioner
selected
by the Company, to fulfil the Participant’s obligations to the Company or
an Affiliate for any consecutive 180-day period or for any period
of
180 days (whether or not consecutive) in any consecutive 365-day
period.
|
13.
|
“Eligible
Person”, subject to the Regulations and to Law, means
(1) any Executive or Employee (including any of those persons who are
on a leave of absence authorized by the board of directors of the
Company
or of any Affiliate), (2) any Subsidiary of an Executive or Employee,
(3) any Consultant or Consultant Entity or (4) any RRSP or RRIF
established by or for an Executive, Employee or Consultant or under
which
the Executive, Employee or Consultant is a
beneficiary.
|
14.
|
“Employee”
has the meaning given to that term in Schedule
1.2.2.
|
15.
|
“Entity”
means any partnership, limited partnership, joint venture, syndicate,
company or corporation with or without share capital, unincorporated
association, trust or other entity however designated or
constituted.
|
16.
|
“Executive”
has the meaning given to that term in Schedule
1.2.2.
|
17.
|
“Fair
Value” has the meaning given to that term in
section 3.1.
|
18.
|
“including”
means including without limitation.
|
19.
|
“Insider”
has the meaning given to the term “insider” in the TSX
Rules.
|
20.
|
“Law”
means all applicable law including all applicable securities laws
and the
rules applicable to any stock exchange or quotation system on which
the
Shares are listed or quoted or on which the Company wishes to list
or
quote its shares (including any required prior regulatory approval
or
shareholder consent).
|
21.
|
“National
Instrument 45-106” means National Instrument 45-106 -
Prospectus and Registration Exemptions, as that instrument may
be amended,
renumbered or reclassified from time to time, and any successor
to that
instrument.
|
22.
|
“Option”
means a right granted to an Eligible Person to purchase Shares
on the
terms of this Plan.
|
23.
|
“Option
Agreement” means an agreement signed by the Company and by a
Participant with respect to a granted Option, as contemplated by
section 4.6.
|
24.
|
“Outstanding
Issue” has the meaning given to the term “outstanding issue” in
the TSX Rules.
|
25.
|
“Participant”
means an Eligible Person to whom an Option has been granted, and,
as
appropriate with respect to each individual Participant (including
in
calculating holdings of a Participant or addressing termination
of a
Participant), also includes an RRSP, RRIF, Subsidiary or Consultant
Entity
related to that Participant.
|
26.
|
“Person”
means any individual, partnership, limited partnership, joint venture,
syndicate, sole proprietorship, company or corporation with or
without
share capital, unincorporated association, trust, trustee, executor,
administrator or other legal personal representative, regulatory
body or
agency, government or governmental agency, authority or entity
however
designated or constituted.
|
27.
|
“Plan”
means this 2007 Share Option Plan of the Company and all schedules
attached to this Plan, in each case as they may be amended or supplemented
from time to time, and unless otherwise indicated, references to
Articles,
sections and Schedules are to the specified Articles, sections
and
Schedules in this Plan.
|
28.
|
“Previous
Stock Option Plan” means the stock option plan of the Company
established October 9, 2003, as
amended.
|
29.
|
“Regulations”
means the regulations set out in Schedule 2.2.5 (Regulations) made
under this Plan, as they may be amended from time to time in accordance
with the Plan.
|
30.
|
“RRIF”
means a registered retirement income
fund.
|
31.
|
“RRSP”
means a registered retirement savings
plan.
|
32.
|
“Security
Based Compensation Arrangement” has the meaning given to the term
“security based compensation arrangement” in the TSX
Rules.
|
33.
|
“Share”
means a common share of the Company and includes any class of securities
into which the common shares of the Company as a whole class may
be
subsequently reclassified, converted or
exchanged.
|
34.
|
“Stock
Market” means each stock exchange or quotation system on which
the Shares are listed or quoted and, in respect of any calculation
or
determination to be made under this Plan, means one which is selected
by
the Board for the purposes of the calculation or determination,
generally
on the basis of volume of trading or other measure as to the accuracy
of
the trading history. If the Shares are listed on the TSX, then
“Stock Market” will mean the TSX for the purpose of any calculation or
determination, unless the trading volume of the Shares is materially
higher on another stock exchange or quotation
system.
|
35.
|
“Stock
Option” has the meaning given to the term “stock option” in the
TSX Rules.
|
36.
|
“Subsidiary”
has the meaning given to that term in Business Corporation Act
(Ontario).
|
37.
|
“Termination
Date” means the date on which a Participant ceases to be an
Eligible Person in accordance with the
Plan.
|
38.
|
“Transfer”
includes any sale, exchange, assignment, gift, bequest, disposition,
mortgage, hypothecate, charge, pledge, encumbrance, grant of security
interest or other arrangement by which possession, legal title,
beneficial
ownership or the right to receive proceeds or benefits of or from
the
subject matter passes from one Person to another, or to the same
Person in
a different capacity, whether or not voluntary and whether or not
for
value, and any agreement to effect any of the foregoing, and the
words
“Transferred”, “Transferring” and
similar words have corresponding
meanings.
|
39.
|
“TSX”
means the Toronto Stock Exchange.
|
40.
|
“TSX
Rules” means the rules of the Toronto Stock Exchange Company
Manual relating to changes in capital structure of listed companies
in
connection with security based compensation arrangements (currently
section 613), as those rules may be amended, renumbered or reclassified
from time to time, or any
successors.
|
1.
|
An
issuer is considered to be an affiliate of another issuer
if one them is a subsidiary of the other, or each of them is controlled
by
the same Person.
|
2.
|
“associate”,
where used to indicate a relationship with any Person or company
means,
|
|
2.1.
|
any
company of which such Person or company beneficially owns, directly
or
indirectly, voting securities carrying more than 10 per cent of
the voting
rights attached to all voting securities of the company for the
time being
outstanding,
|
|
2.2.
|
any
partner of that Person or company,
|
|
2.3.
|
any
trust or estate in which such Person or company has a substantial
beneficial interest or as to which such Person or company serves
as
trustee or in a similar capacity,
|
|
2.4.
|
any
relative of that Person who resides in the same home as that
Person,
|
|
2.5.
|
any
Person who resides in the same home as that Person and to whom
that Person
is married or with whom that Person is living in a conjugal relationship
outside marriage, or
|
|
2.6.
|
any
relative of a Person mentioned in clause 2.5 who has the same home as
that Person.
|
3.
|
a
Person (first Person) is considered to control another
Person (second Person) if
|
|
3.1.
|
the
first Person, directly or indirectly, beneficially owns or exercises
control or direction over securities of the second Person carrying
votes
which, if exercised, would entitle the first Person to elect a
majority of
the directors of the second Person, unless that first Person holds
the
voting securities only to secure an
obligation,
|
|
3.2.
|
the
second Person is a partnership, other than a limited partnership,
and the
first Person holds more than 50 percent of the interests of the
partnership, or
|
|
3.3.
|
the
second Person is a limited partnership and the general partner
of the
limited partnership is the first
Person.
|
4.
|
“consultant”
means, for an issuer, a Person, other than an employee, executive
officer,
or director of the issuer or of a related entity of the issuer,
that
(i) is engaged to provide services to the issuer or a related entity
of the issuer, other than services provided in relation to a distribution,
(ii) provides the services under a written contract with the issuer
or a related entity of the issuer, and (iii) spends or will spend a
significant amount of time and attention on the affairs and business
of
the issuer or a related entity of the issuer; and includes, for
an
individual consultant, a corporation of which the individual consultant
is
an employee or shareholder, and a partnership of which the individual
consultant is an employee or
partner.
|
5.
|
“employee”
means, for an issuer, an employee of the issuer or of an affiliate
of the
issuer, other than an executive of the
issuer.
|
6.
|
“executive”
means, for an issuer, an issuer-officer or an
issuer-director.
|
7.
|
“incentive”
means a compensation or incentive arrangement for an
executive.
|
8.
|
“incentive
plan” means a plan providing for
incentives.
|
9.
|
“insider”
of a listed company means:
|
|
9.1.
|
an
insider as defined in the Securities Act (Ontario), other than a
Person who falls within that definition solely by virtue of being
a
director or senior officer of a subsidiary of the listed company,
and
|
|
9.2.
|
an
associate of any Person who is an insider by virtue of
9.1.
|
10.
|
“outstanding
issue” means the number of shares of the applicable class
outstanding on a non-diluted basis.
|
11.
|
“security
based compensation arrangement” means (i) stock option plans for
the benefit of employees, insiders, service providers or any one
of such
groups; (ii) individual stock options granted to employees, service
providers or insiders if not granted pursuant to a plan previously
approved by the listed issuer’s security holders; (iii) stock purchase
plans where the listed issuer provides financial assistance or
where the
listed issuer matches the whole or a portion of the securities
being
purchased; (iv) stock appreciation rights involving issuances of
securities from treasury; (v) any other compensation or incentive
mechanism involving the issuance or potential issuances of securities
of
the listed issuer; and (vi) security purchases from treasury by
an
employee, insider or service provider which is financially assisted
by the
listed issuer by any means
whatsoever.
|
12.
|
“stock
option” means an option to purchase shares from treasury granted
to a service provider as a compensation or incentive
mechanism.
|
13.
|
“subsidiary” means
an issuer that is controlled directly or indirectly by another
issuer and
includes a subsidiary of that
subsidiary.
|
1.
|
Subject
to the Law and upon notice to the Company, a Participant may Transfer
Options, or Shares received under the exercise of Options, to any
RRSP or
RRIF established by or for the Participant or under which the Participant
is a beneficiary. Upon death of a Participant, the
Participant’s Option(s) will become part of the Participant’s estate, and
any right of the Participant may be exercised by the former Participant’s
legal representatives, provided the legal representatives comply
with all
obligations of the former
Participant.
|
2.
|
A
Participant who is an Executive or Employee will cease to be an
Eligible
Person on the earliest of:
|
|
2.1.
|
the
end of the notice period, if the Company gives the Participant
notice of
termination of appointment and/or employment or the Participant
gives the
Company notice of resignation and the Participant continues to
hold the
appointment and/or work during the notice
period,
|
|
2.2.
|
the
date on which the Company gives the Participant notice of termination
of
appointment and/or employment (with or without Cause), if the Participant
does not continue to hold the appointment and/or work during the
notice
period, and, for greater certainty, will not include any period
of
statutory or common law notice or
severance,
|
|
2.3.
|
the
date on which the Participant gives the Company notice of resignation,
if
the Participant does not continue to hold the appointment and/or
work
during the notice period,
|
|
2.4.
|
the
date of the Participant’s
retirement,
|
|
2.5.
|
the
date of the Participant’s death,
|
|
2.6.
|
the
date of the Participant’s
Disability,
|
|
2.7.
|
the
date on which the Participant otherwise fails to meet the criteria
set out
under the definition of an Eligible Person,
and
|
|
2.8.
|
in
any other case, the actual date on which both the Participant and
the
Company had actual notice that the Participant’s appointment and/or
employment would cease on a particular
date.
|
3.
|
The
date of a Participant’s Disability will be the last day of the applicable
period during which the Participant is unable to fulfil the Participant’s
obligations to the Company.
|
4.
|
A
Participant who is a Consultant will cease to be an Eligible Person
on the
earliest of:
|
|
4.1
|
the
completion or substantial performance of the Consultant’s engagement in
accordance with the terms of the written
contract,
|
|
4.2
|
the
expiration of the Consultant’s written
contract,
|
|
4.3
|
the
notice of termination by the Company of the contract whether with
or
without Cause, or
|
|
4.4
|
the
services of any key individual referred to in the Consultant Entity’s
contract no longer being available to the Company as required under
the
contract.
|
5.
|
If
the legal representative of a Participant who has died or has a
Disability
purports to exercise any Options of the Participant, the Company
will have
no obligation to issue the Shares until evidence satisfactory to
the
Company has been provided that the legal representative is entitled to
exercise the Options.
|
Date
of grant of Option:
|
|
The
total number of Shares subject to this Option is:
|
|
The
exercise price of this Option is:
|
$
|
Column
1
|
Column
2
|
|||
Time
Period
|
Number
of Options
vesting
following
that
time period
|
|||
|
to
|
|||
|
to
|
|||
to
|
By signing and delivering this agreement, you are acknowledging receipt of copies of the Plan and having been provided with an opportunity to consider the Plan and to seek independent legal advice with respect to them, and are agreeing to be bound by all terms of this letter and the Plan. |
Signature:
|
||
Name
(print):
|
||
Address:
|
||
|
||
Date:
|
||
Witness
Signature:
|
||
Witness
Name print):
|
TO:
|
Lorus
Therapeutics Inc. (the “Company”)
2
Meridian Road
Toronto,
Ontario
M9W
4Z7
Attention: Corporate
Secretary
|
RE:
|
Share
Option Exercise under the 2003 Share Option Plan of the
Company
|
o
|
under
section 5.1 of the Plan, exercise the vested portion of my Option to
purchase ________ Shares at the price of $ ______ per Share, and
I hereby subscribe for that number of Shares at that price, enclose
payment for those Shares in full by bank draft or certified cheque
in the
total amount of $ _________ and direct
that
|
|
•
|
I
am resident at the address set out below;
and
|
|
•
|
I
have received copies of the Plan and the Option Agreement and am
agreeing
to be bound by all terms of those
agreements.
|
Signature:
|
||
Name
(print):
|
||
Address:
|
||
|
||
Date:
|
||
Broker
account
details:
|
||
|