Exhibit 10.27

North Carolina Commercial Lease Agreement
 
This Commercial Lease Agreement ("Lease") is made and effective the 1st day of
January, 2010, by and between VALFERN HOLDINGS, INC. ("Landlord") and ADHEREX
TECHNOLOGIES, INC. ("Tenant").
 
Landlord is the owner of land and improvements commonly known and numbered as
501 EASTOWNE DR., Ste. 140 CHAPEL HILL, NC 27514 and legally described as
follows (the "Building"):
 
Landlord makes available for lease a portion of the Building designated as
Approximately 1,058 RSF, said premises shall be of Suite 140 of the building
designated above. (the "Leased Premises").
 
Landlord desires to lease the Leased Premises to Tenant, and Tenant desires to
lease the Leased Premises from Landlord for the term, at the rental and upon the
covenants, conditions and provisions herein set forth.
 
THEREFORE, in consideration of the mutual promises herein, contained and other
good and valuable consideration, it is agreed:
 
1. Term.
 
A. Landlord hereby leases the Leased Premises including Furniture outlined in
Exhibit B to Tenant, and Tenant hereby leases the same from Landlord, for an
"Initial Term" beginning the 15th day of January, 2010 and ending the 15th day
of January, 2011. Landlord shall use its best efforts to give Tenant possession
as nearly as possible at the beginning of the Lease term. If Landlord is unable
to timely provide the Leased Premises, rent shall abate for the period of delay.
Tenant shall make no other claim against Landlord for any such delay.
 
B. Tenant may renew the Lease for one extended term of one calendar year. Tenant
shall exercise such renewal option, if at all, by giving written notice to
Landlord not less than ninety (90) days prior to the expiration of the Initial
Term. The renewal term shall be at the rental set forth below and otherwise upon
the same covenants, conditions and provisions as provided in this Lease.
 
2. Rental.
 
A. Tenant shall pay to Landlord during the Initial Term rental of $24,281.11 per
year, payable in installments of $2,023.43 per month. Each installment payment
shall be due in advance on the fifth day of each calendar month during the lease
term to Landlord at Valfern Holdings, Inc. 501 Eastowne Dr., Ste. 145 Chapel
Hill, NC 27514 or at such other place designated by written notice from Landlord
to Tenant. The rental payment amount for any partial calendar months included in
the lease term shall be prorated on a daily basis. Tenant shall also pay to
Landlord a "Security Deposit" in the amount of $2023.43.
 

 
 

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B. The rental for any renewal period shall be independently negotiated between
the parties and shall be agreed to in writing at such time as Tenant should
elect to renew the said lease.  The parties at such time shall then sign a lease
addendum laying out the annual rent.
 
3. Use
 
Notwithstanding the forgoing, Tenant shall not use the Leased Premises for the
purposes of storing, manufacturing or selling any explosives, flammables or
other inherently dangerous substance, chemical, thing or device.
 
4. Sublease and Assignment.
 
Tenant shall have the right without Landlord's consent, to assign this Lease to
a corporation with which Tenant may merge or consolidate, to any subsidiary of
Tenant, to any corporation under common control with Tenant, or to a purchaser
of substantially all of Tenant's assets. Except as set forth above, Tenant shall
not sublease all or any part of the Leased Premises, or assign this Lease in
whole or in part without Landlord's consent, such consent not to be unreasonably
withheld or delayed.
 
5. Repairs.
 
During the Lease term, Tenant shall make, at Tenant's expense, all necessary
repairs to the Leased Premises. Repairs shall include such items as routine
repairs of floors, walls, ceilings, and other parts of the Leased Premises
damaged or worn through normal occupancy, except for major mechanical systems or
the roof, subject to the obligations of the parties otherwise set forth in this
Lease.
 
6. Alterations and Improvements.
 
Tenant, at Tenant's expense, shall have the right following Landlord's written
consent to remodel, redecorate, and make additions, improvements and
replacements of and to all or any part of the Leased Premises from time to time
as Tenant may deem desirable, provided the same are made in a workmanlike manner
and utilizing good quality materials. Tenant shall have the right to place and
install personal property, trade fixtures, equipment and other temporary
installations in and upon the Leased Premises, and fasten the same to the
premises. All personal property, equipment, machinery, trade fixtures and
temporary installations, whether acquired by Tenant at the commencement of the
Lease term or placed or installed on the Leased Premises by Tenant thereafter,
shall remain Tenant's property free and clear of any claim by Landlord. Tenant
shall have the right to remove the same at any time during the term of this
Lease provided that all damage to the Leased Premises caused by such removal
shall be repaired by Tenant at Tenant's expense.
 

 
 

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7. Property Taxes.
 
Landlord shall pay, prior to delinquency, all general real estate taxes and
installments of special assessments coming due during the Lease term on the
Leased Premises, and all personal property taxes with respect to Landlord's
personal property, if any, on the Leased Premises. Tenant shall be responsible
for paying all personal property taxes with respect to Tenant's personal
property at the Leased Premises.
 
8. Association.
 
Landlord shall pay, prior to delinquency, all association dues for the premises
and shall hold harmless the tenant thereof.
 
9. Utilities.
 
A. The tenant shall be responsible for any public or private utilities on the
premises and shall hold landlord harmless thereto.
 
B. Tenant shall pay all charges for water, sewer, gas, electricity, telephone,
internet, security, janitorial, telephone operator and other services and
utilities used by Tenant on the Leased Premises during the term of this Lease
unless otherwise expressly agreed in writing by Landlord. In the event that any
utility or service provided to the Leased Premises is not separately metered or
if the Tenant wishes to utilize any of the aforesaid services from the Landlord,
Landlord shall pay the amount due and separately invoice Tenant for Tenant's
share of the charges by a separate agreement. Tenant shall pay such amounts
within fifteen (15) days of invoice. Tenant acknowledges that the Leased
Premises are designed to provide standard office use electrical facilities and
standard office lighting. Tenant shall not use any equipment or devices that
utilizes excessive electrical energy or which may, in Landlord's reasonable
opinion, overload the wiring or interfere with electrical and other services to
other tenants.
 
10. Insurance.
 
A. If the Leased Premises or any other part of the Building is damaged by fire
or other casualty resulting from any act or negligence of Tenant or any of
Tenant's agents, employees or invitees, rent shall not be diminished or abated
while such damages are under repair, and Tenant shall be responsible for the
costs of repair not covered by insurance.
 
B. Landlord shall maintain fire and extended coverage insurance on the Building
and the Leased Premises in such amounts as Landlord shall deem appropriate.
Tenant shall be responsible, at its expense, for fire and extended coverage
insurance on all of its personal property, including removable trade fixtures,
located in the Leased Premises.
 

 
 

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C. Tenant and Landlord shall, each at its own expense, maintain a policy or
policies of content coverage and comprehensive general liability insurance with
respect to the respective activities of each in the Building with the premiums
thereon fully paid on or before due date, issued by and binding upon some
insurance company approved by Landlord, such insurance to afford minimum
protection of not less than $1,000,000 combined single limit coverage of bodily
injury, property damage or combination thereof. Landlord shall be listed as an
additional insured on the Tenant's policy or policies of comprehensive general
liability insurance and content coverage, and Tenant shall provide Landlord with
current Certificates of Insurance evidencing Tenant's compliance with this
Paragraph. Tenant shall obtain the agreement of Tenant's insurers to notify
Landlord that a policy is due to expire at least (10) days prior to such
expiration. Landlord shall not be required to maintain insurance against thefts
within the Leased Premises or the Building.
 
11. Indemnity
 
Landlord shall not be liable to Tenant or to Tenant’s employees, agents,
invitees or visitors, or to any other person, for any injury to persons or
damage to property on or about the Demised Premises or any adjacent area owned
by Landlord caused by the negligence or misconduct of Tenant.  Tenant shall not
be liable for any injury or damage caused by the negligence or misconduct of
Landlord, or Landlord’s employees or agents, and Landlord agrees to indemnify
and hold Tenant harmless from any loss, expense or damage arising out of such
damage or injury.
 
12. Signs.
 
Following Landlord's consent, Tenant shall have the right to place on the Leased
Premises, at locations selected by Tenant, any signs which are permitted by
applicable zoning ordinances and private restrictions. Landlord may refuse
consent to any proposed signage that is in Landlord's opinion too large,
deceptive, unattractive or otherwise inconsistent with or inappropriate to the
Leased Premises or use of any other tenant. Landlord shall assist and cooperate
with Tenant in obtaining any necessary permission from governmental authorities
or adjoining owners and occupants for Tenant to place or construct the foregoing
signs. Tenant shall repair all damage to the Leased Premises resulting from the
removal of signs installed by Tenant.  Any cost of said signage shall be the
sole responsibility of the Tenant.
 

 
 

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13. Use of Premises Prior to Commencement Date.
 
The tenant shall have the right to use the premises in a limited capacity prior
to the commencement of this lease at his own risk and liability.  Said capacity
shall be as follows:  Tenant shall have the right to use one cubicle, the
conference room and space adjoining the suite to store two file cabinets.  Said
use shall begin on the 23rd day of December, 2009 and shall cease upon the
commencement date of this lease.  There shall be no charge for this use of the
rental space, provided that the security deposit has been paid in full to the
Landlord by the 23rd day of December, 2010.
 
13. Entry.
 
Landlord shall have the right to enter upon the Leased Premises at reasonable
hours to inspect the same, provided Landlord shall not thereby unreasonably
interfere with Tenant's business on the Leased Premises.
 
14. Parking.
 
During the term of this Lease, Tenant shall have the non-exclusive use in common
with Landlord, other tenants of the Building, their guests and invitees, of the
non-reserved common automobile parking areas, driveways, and footways, subject
to rules and regulations for the use thereof as prescribed from time to time by
Landlord. Landlord reserves the right to designate parking areas within the
Building or in reasonable proximity thereto, for Tenant and Tenant's agents and
employees. Tenant hereby leases from Landlord one reserved parking space in the
parking deck at a location to be designated by the Landlord, which shall be
available for use by the Tenant.  Other than the single space in such structural
parking area, all other parking spaces around the building are available for use
by all building users on a first come-first served basis except any spaces that
are otherwise reserved. There shall be no additional charge or rental fee for
the parking space noted above.
 
15. Building Rules.
 
Tenant will comply with the rules of the Building adopted and altered by
Landlord from time to time and will cause all of its agents, employees, invitees
and visitors to do so; all changes to such rules will be sent by Landlord to
Tenant in writing. The initial rules for the Building are attached hereto as
Exhibit "A" and incorporated herein for all purposes.
 
16. Damage and Destruction.
 
If the Leased Premises or any part thereof or any appurtenance thereto is so
damaged by fire, casualty or structural defects that the same cannot be used for
Tenant's purposes, then Tenant shall have the right within ninety (90) days
following damage to elect by notice to Landlord to terminate this Lease as of
the date of such damage. In the event of minor damage to any part of the Leased
Premises, and if such damage does not render the Leased Premises unusable for
Tenant's purposes, Landlord shall promptly repair such damage at the cost of the
Landlord. In making the repairs called for in this paragraph, Landlord shall not
be liable for any delays resulting from strikes, governmental restrictions,
inability to obtain necessary materials or labor or other matters which are
beyond the reasonable control of Landlord. Tenant shall be relieved from paying
rent and other charges during any portion of the Lease term that the Leased
Premises are inoperable or unfit for occupancy, or use, in whole or in part, for
Tenant's purposes. Rentals and other charges paid in advance for any such
periods shall be credited on the next ensuing payments, if any, but if no
further payments are to be made, any such advance payments shall be refunded to
Tenant. The provisions of this paragraph extend not only to the matters
aforesaid, but also to any occurrence which is beyond Tenant's reasonable
control and which renders the Leased Premises, or any appurtenance thereto,
inoperable or unfit for occupancy or use, in whole or in part, for Tenant's
purposes.
 

 
 

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17. Default.
 
If default shall at any time be made by Tenant in the payment of rent when due
to Landlord as herein provided, and if said default shall continue for fifteen
(15) days after written notice thereof shall have been given to Tenant by
Landlord, or if default shall be made in any of the other covenants or
conditions to be kept, observed and performed by Tenant, and such default shall
continue for thirty (30) days after notice thereof in writing to Tenant by
Landlord without correction thereof then having been commenced and thereafter
diligently prosecuted, Landlord may declare the term of this Lease ended and
terminated by giving Tenant written notice of such intention, and if possession
of the Leased Premises is not surrendered, Landlord may reenter said premises.
Landlord shall have, in addition to the remedy above provided, any other right
or remedy available to Landlord on account of any Tenant default, either in law
or equity. Landlord shall use reasonable efforts to mitigate its damages.
 
18. Quiet Possession.
 
Landlord covenants and warrants that upon performance by Tenant of its
obligations hereunder, Landlord will keep and maintain Tenant in exclusive,
quiet, peaceable and undisturbed and uninterrupted possession of the Leased
Premises during the term of this Lease.
 
19. Condemnation.
 
If any legally, constituted authority condemns the Building or such part thereof
which shall make the Leased Premises unsuitable for leasing, this Lease shall
cease when the public authority takes possession, and Landlord and Tenant shall
account for rental as of that date. Such termination shall be without prejudice
to the rights of either party to recover compensation from the condemning
authority for any loss or damage caused by the condemnation. Neither party shall
have any rights in or to any award made to the other by the condemning
authority.
 

 
 

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20. Subordination.
 
Tenant accepts this Lease subject and subordinate to any mortgage, deed of trust
or other lien presently existing or hereafter arising upon the Leased Premises,
or upon the Building and to any renewals, refinancing and extensions thereof,
but Tenant agrees that any such mortgagee shall have the right at any time to
subordinate such mortgage, deed of trust or other lien to this Lease on such
terms and subject to such conditions as such mortgagee may deem appropriate in
its discretion. Landlord is hereby irrevocably vested with full power and
authority to subordinate this Lease to any mortgage, deed of trust or other lien
now existing or hereafter placed upon the Leased Premises of the Building, and
Tenant agrees upon demand to execute such further instruments subordinating this
Lease or attorning to the holder of any such liens as Landlord may request. In
the event that Tenant should fail to execute any instrument of subordination
herein required to be executed by Tenant promptly as requested, Tenant hereby
irrevocably constitutes Landlord as its attorney-in-fact to execute such
instrument in Tenant's name, place and stead, it being agreed that such power is
one coupled with an interest. Tenant agrees that it will from time to time upon
request by Landlord execute and deliver to such persons as Landlord shall
request a statement in recordable form certifying that this Lease is unmodified
and in full force and effect (or if there have been modifications, that the same
is in full force and effect as so modified), stating the dates to which rent and
other charges payable under this Lease have been paid, stating that Landlord is
not in default hereunder (or if Tenant alleges a default stating the nature of
such alleged default) and further stating such other matters as Landlord shall
reasonably require.
 
21. Security Deposit.
 
The Security Deposit shall be held by Landlord without liability for interest
and as security for the performance by Tenant of Tenant's covenants and
obligations under this Lease, it being expressly understood that the Security
Deposit shall not be considered an advance payment of rental or a measure of
Landlord's damages in case of default by Tenant. Unless otherwise provided by
mandatory non-waivable law or regulation, Landlord may commingle the Security
Deposit with Landlord' s other funds. Landlord may, from time to time, without
prejudice to any other remedy, use the Security Deposit to the extent necessary
to make good any arrearages of rent or to satisfy any other covenant or
obligation of Tenant hereunder. Following any such application of the Security
Deposit, Tenant shall pay to Landlord on demand the amount so applied in order
to restore the Security Deposit to its original amount. If Tenant is not in
default at the termination of this Lease, the balance of the Security Deposit
remaining after any such application shall be returned by Landlord to Tenant
within thirty days after termination of the Lease Agreement. If Landlord
transfers its interest in the Premises during the term of this Lease, Landlord
may assign the Security Deposit to the transferee and thereafter shall have no
further liability for the return of such Security Deposit.
 

 
 

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22. Notice.
 
Any notice required or permitted under this Lease shall be deemed sufficiently
given or served if sent by United States certified mail, return receipt
requested, addressed as follows:
 
If to Landlord to:
 
Valfern Holdings, Inc.
 
501 Eastowne Drive, Ste. 145
 
Chapel Hill, NC 27514
 
If to Tenant to:
 
Adherex Technologies, Inc.
 
C/O Robert Andrade
 
501 Eastowne Drive, Ste. 140
 
Chapel Hill, NC 27514
 
Landlord and Tenant shall each have the right from time to time to change the
place notice is to be given under this paragraph by written notice thereof to
the other party.
 
23. Brokers.
 
Tenant warrants that it has had no dealings with any broker or agent in
connection with this Lease, other than Mike Lewis of Morris Commercial Inc. and
J. Daniel Allen of Insight Property Group whose commission will be paid by
Landlord in terms of a separate existing Agreement between the Landlord and
Insight Property Group and Tenant covenants to pay, hold harmless and indemnify
Landlord from and against, any and all cost, expense or liability for any
compensation, commissions and charges claimed by any other broker or agent with
respect to this Lease or the negotiation thereof arising out of Tenant's
actions.
 

 
 

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24. Waiver.
 
No waiver of any default of Landlord or Tenant hereunder shall be implied from
any omission to take any action on account of such default if such default
persists or is repeated, and no express waiver shall affect any default other
than the default specified in the express waiver and that only for the time and
to the extent therein stated. One or more waivers by Landlord or Tenant shall
not be construed as a waiver of a subsequent breach of the same covenant, term
or condition.
 
25. Memorandum of Lease.
 
The parties hereto contemplate that this Lease should not and shall not be filed
for record, but in lieu thereof, at the request of either party, Landlord and
Tenant shall execute a Memorandum of Lease to be recorded for the purpose of
giving record notice of the appropriate provisions of this Lease.
 
26. Headings.
 
The headings used in this Lease are for convenience of the parties only and
shall not be considered in interpreting the meaning of any provision of this
Lease.
 
27. Successors.
 
The provisions of this Lease shall extend to and be binding upon Landlord and
Tenant and their respective legal representatives, successors and assigns.
 
28. Consent.
 
Landlord shall not unreasonably withhold or delay its consent with respect to
any matter for which Landlord's consent is required or desirable under this
Lease.
 
29. Performance.
 
If there is a default with respect to any of Landlord's covenants, warranties or
representations under this Lease, and if the default continues more than fifteen
(15) days after notice in writing from Tenant to Landlord specifying the
default, Tenant may, at its option and without affecting any other remedy
hereunder, cure such default and deduct the cost thereof from the next accruing
installment or installments of rent payable hereunder until Tenant shall have
been fully reimbursed for such expenditures, together with interest thereon at a
rate equal to the lesser of twelve percent (12%) per annum or the then highest
lawful rate. If this Lease terminates prior to Tenant's receiving full
reimbursement, Landlord shall pay the unreimbursed balance plus accrued interest
to Tenant on demand.
 
30. Compliance with Law.
 
Tenant shall comply with all laws, orders, ordinances and other public
requirements now or hereafter pertaining to Tenant's use of the Leased Premises.
Landlord shall comply with all laws, orders, ordinances and other public
requirements now or hereafter affecting the Leased Premises.
 

 
 

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31. Final Agreement.
 
This Agreement terminates and supersedes all prior understandings or agreements
on the subject matter hereof. This Agreement may be modified only by a further
writing that is duly executed by both parties.
 
32. Governing Law.
 
This Agreement shall be governed, construed and interpreted by, through and
under the Laws of the State of North Carolina.
 
IN WITNESS WHEREOF, the parties have executed this Lease as of the day and year
first above written.
 
VALFERN HOLDINGS, INC.
 

       
Joy Valentine, President
 

 
ADHEREX TECHNOLOGIES, INC.
 

       
Robert Andrade, CFO
 

 

 
 

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Annexure B
 
List of Furniture
 
Reception area:
 
One Loveseat, one coffee table, one reception desk and one work chair
 
Work space:
 
3 cubicles with work surfaces and 3 work chairs, inbuilt cabinets in work area
near the server closet
 
Conference Room:
 
One conference table and 4 chairs, inbuilt cabinet
 
Private office:
 
One desk with return and credenza, one work chair,
 

 
 

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