ex41.htm


     

    Exhibit
      4.1

     

     

    

    

      1993

       

      STOCK
        OPTION PLAN

       

      
        	
                1.

              	
                DEFINITIONS

              


      

       

      “Black
        Out Period” means any period during which a policy of the Company
        prevents an insider from trading in the Shares.

       

      “Consultant”
        means an individual other than an employee, director or officer of the Company
        that provides on a bona fide basis consulting, technical, management or
        other services to the Company or any subsidiary, under a written contract
        between the Company or any subsidiary and the individual or a consultant
        company
        or consultant partnership of the individual, and who, in the reasonable opinion
        of the Company, spends a significant amount of time and attention on the
        affairs
        and business of the Company or any subsidiary. The term "Consultant" will
        include both: i) a consultant who comes within the definition and is providing
        services on a project basis for a fixed period of time (a "Project Consultant");
        and ii) a consultant or key individual under a consulting agreement, who
        comes
        within the definition and is providing services on a continuous basis for
        an
        indeterminate or renewable period of time (a "Continuing
        Consultant").

       

      
        	
                2.

              	
                PURPOSE

              


      

       

      The
        purpose of this Stock Option Plan (the "Plan") is to
        authorize the grant to directors, officers, Consultants and employees (the
        "Optionee") of Lorus Therapeutics Inc. (the "Company") or any present or
        future
        subsidiary thereof (as hereinafter defined) of options to purchase common
        shares
        ("Shares") of the Company and thus benefit the Company by enabling it to
        attract, retain and motivate directors, officers, Consultants and employees
        by
        providing them with the opportunity, through Share options, to acquire an
        increased proprietary interest in the Company.

       

      
        	
                3.

              	
                ADMINISTRATION

              


      

       

      The
        Plan shall be administered by the Board of Directors of the Company. Subject
        to
        approval of the granting of options by the Board of Directors, the Company
        shall
        grant options under the Plan.

       

      
        	
                4.

              	
                SHARES
                  SUBJECT TO PLAN

              


      

       

      Subject
        to adjustment under the provisions of paragraph 10 hereof, the aggregate
        number
        of Shares of the Company that may be issued and sold under the Plan and any
        other Share Compensation Arrangement (as that term is defined in the rules
        of
        the Toronto Stock Exchange Company Manual relating to changes in capital
        structure of listed companies in connection with employee stock option and
        stock
        purchase plans) shall not exceed 15% of the issued and outstanding common
        shares
        of the Company on a non diluted basis. The total number of Shares which may
        be
        reserved for optioning to any one individual under the Plan shall not exceed
        5%
        of the total number of issued and outstanding Shares (on a non-diluted basis),
        including Shares

       


      
        
          
          

        

        
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            1
            -

          
            

          

        

        
          
          

        

      


       

      reserved
        for issuance under employee stock option plans, options for services and
        employee stock purchase plans. The number of shares issuable to insiders,
        at any
        time, under the Plan and all other security-based compensation arrangements,
        cannot exceed 10% of issued and outstanding common shares of the
        Company.  The number of shares issued to insiders, within any one year
        period, under the Plan and all other security-based compensation arrangements,
        cannot exceed 10% of issued and outstanding common shares of the
        Company.  The Company shall not, upon the exercise of any option, be
        required to issue or deliver any Shares prior to (a) the admission of such
        Shares to listing on any stock exchanges on which the Company’s Shares may then
        be listed, and (b) the completion of such registration or other qualification
        of
        such Shares under any law, rule or regulation as the Company shall determine
        to
        be necessary or advisable.

       

      
        	
                5.

              	
                ELIGIBILITY

              


      

       

      Options
        shall be granted only to directors, officers, Consultants and to such employees
        who, at the time of the grant, are employees of or on contract to the Company
        or
        any subsidiary. The term "subsidiary" as used in the Plan shall mean any
        corporation in which the Company owns, directly or indirectly, stock possessing
        50% or more of the total combined voting power of all classes of
        stock.

       

      Subject
        to the foregoing, the Board of Directors shall have full and final authority
        to
        determine the persons who are to be granted options under the Plan and the
        number of Shares subject to each option. Within 10 days of the issue of any
        option, a designated officer shall file a letter with securities regulators
        demonstrating compliance with any applicable blanket rulings regarding trades
        in
        options to directors or senior officers and provide substantially the same
        information as prescribed by Form 20 under the Ontario Securities
        Act.

       

      
        	
                6.

              	
                PRICE

              


      

       

      The
        purchase price (the "Price") for the Shares of the Company under each option
        shall be determined by the Board of Directors on the basis of the closing
        market
        price of the Shares on The Toronto Stock Exchange on the last trading date
        preceding the date of the grant or, in the event there is not a market price
        on
        The Toronto Stock Exchange, on the basis of the closing market price of the
        Shares on the Montreal Exchange on the last trading date preceding the date
        of
        the grant. If there is not a market price on The Toronto Stock Exchange or
        the
        Montreal Exchange, the Price for the Shares under each option shall be
        determined by the Board of Directors on the basis of the average of the bid
        and
        ask for the Shares on The Toronto Stock Exchange on the date preceding the
        date
        of the grant.

       

      
        	
                7.

              	
                PERIOD
                  OF OPTION AND RIGHTS TO
                  EXERCISE

              


      

       

      Subject
        to the provisions of this paragraph 6 and paragraphs 8 and 9 below, options
        will
        be exercisable in whole or in part, and from time to time, during the currency
        thereof. Options shall not be granted for a term exceeding five
        years.  The expiry period for options granted under the Plan and
        outstanding as of October 7, 2004 will expire 10 years from the date of the
        grant. The Shares to be purchased upon each exercise of any option shall
        be paid
        for in full, in cash, at the time of such exercise. Except for Project
        Consultants and as provided in paragraphs 8 and 9

       


      
        
          
          

        

        
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            2
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      below,
        no option may be exercised unless the Optionee is then a director, officer,
        Continuing Consultant or in the employ of the Company or any subsidiary and,
        in
        the case of a Continuing Consultant or any employee, shall have been
        continuously under contract or employed by the Company and its subsidiaries
        since the grant of the option.

       

      Notwithstanding
        anything contained herein or in any option agreement, if the date on which
        an
        option expires pursuant to an option agreement occurs during, or within 10
        days
        after the last day of, a Black Out Period or other trading restriction imposed
        by the Company, the expiry date for the option will be the last day of the
        10-day period.

       

      Absence
        on leave approved by an officer of the Company or any officer of a subsidiary
        authorized to give such approval shall not be considered an interruption
        of
        employment for any purpose of the Plan.

       

      
        	
                8.

              	
                NON-TRANSFERABILITY
                  OF OPTION

              


      

       

      No
        option granted under the Plan shall be transferable by an Optionee otherwise
        than by will or by the laws of descent and distribution, and such option
        shall
        be exercisable, during the Optionee's lifetime, only by the
        Optionee.

       

      
        	
                9.

              	
                TERMINATION
                  OF EMPLOYMENT

              


      

       

      Except
        for Project Consultants, if any Optionee shall cease to be an officer, director,
        Continuing Consultant or employee of the Company or any subsidiary for any
        reason (except as otherwise provided in paragraph 9), the Optionee may, but
        only
        within the period of three months next succeeding such cessation and in no
        event
        after the expiry date of the option, exercise the option.

       

      
        	
                10.

              	
                DEATH
                  OF OPTIONEE

              


      

       

      In
        the event of the death of an Optionee during the currency of the Optionee's
        option, the option theretofore granted to the Optionee shall be exercisable
        within, but only within, the period of nine months next succeeding the
        Optionee's death, and in no event after the expiry date of the
        option.

       

      
        	
                11.

              	
                ADJUSTMENTS
                  IN SHARES SUBJECT TO
                  PLAN

              


      

       

      The
        aggregate number and kind of Shares available under the Plan shall be
        appropriately adjusted in the event of a reorganization, recapitalization,
        stock
        split, stock dividend, combination of Shares, merger, consolidation, rights
        offering or any other change in the corporate structure of Shares of the
        Company. The options granted under the Plan shall contain such provisions
        as the
        Board of Directors may determine with respect to adjustments to be made in
        the
        number and kind of Shares covered by such options and in the option price
        in the
        event of any such change.

       


      
        
          
          

        

        
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            3
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                12.

              	
                AMENDMENT
                  AND TERMINATION OF THE
                  PLAN

              


      

       

      The
        Board of Directors reserves the right, in its sole discretion, to amend,
        suspend
        or terminate the Plan or any portion thereof at any time, in accordance with
        applicable legislation, without obtaining the approval of
        shareholders.  Any amendment to any provision of the Plan will be
        subject to any required regulatory or shareholder
        approval.  Notwithstanding the foregoing, the Company will be required
        to obtain the approval of the shareholders of the Company for any amendment
        related to:

       

      
        	
                 

              	
                (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.

              


      

       

      If
        this Plan is terminated, the provisions of this Plan, the Regulations and
        any
        administrative guidelines and other rules adopted by the Board and in force
        when
        this Plan is terminated will continue in effect as long as any Option, or
        any
        right under an Option, remains outstanding.  However, notwithstanding
        the termination of this Plan, the Board may make any amendments to this Plan,
        or
        to any outstanding Option, that it would be entitled to make if this Plan
        were
        still in effect.

       

      
        	
                13.

              	
                EFFECTIVE
                  DATE OF THE PLAN

              


      

       

      The
        Plan becomes effective on the date of its adoption by the Board of Directors
        and
        options may be granted immediately thereafter.

       

      
        	
                14.

              	
                EVIDENCE
                  OF OPTIONS

              


      

       

      Each
        option granted Under the Plan shall be embodied in a written open agreement
        between the Company and the Optionee which shall give effect to the provisions
        of the Plan.

       

      
        	
                15.

              	
                APPROVAL

              


      

       

      The
        Plan was approved by the directors of the Company on June 3, 1993 and amended
        by
        the directors of the Company on July 22, 1994, November 1, 1996, October
        16,
        1997, October 14, 1998 and June 11, 1999. Shareholder approval of the June
        11,
        1999 amendment was given at the special meeting of the Company held on July
        14,
        1999.  The Plan was amended by the directors of the Company on October
        7, 2004.  Shareholder approval of the October 7, 2004 amendment was
        given at the annual and special meeting of the Company on November 18,
        2004.  Shareholder approval of the July 20, 2005 amendment was granted
        at the annual general and special meeting of the Company held on September
        13,
        2005.  The Plan was amended pursuant to the filing of articles of
        arrangement dated July 10, 2007.

       

      DATED
        at Toronto, Ontario this 10th day of
        July,
        2007.

       

       

       

       

      Aiping
        H. Young

      President
        and Chief Executive Officer

      Lorus
        Therapeutics Inc.

       

       

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        4
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      LORUS
        THERAPEUTICS INC.

       

       

       
        
          

        

      

      
         

        2003
          SHARE OPTION PLAN

      

      
        (As
          amended September 19, 2007)

         
          
            

          

        

        


      

      September
        19, 2007

       

      


       

      


       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      TABLE
        OF CONTENTS

       

      ARTICLE 1.

      INTERPRETATION

       

      
        	
                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

              
	
                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

              	
                2

              
	
                2.3.

              	
                Grants
                  by CEO

              	
                3

              
	
                2.4.

              	
                Shares
                  Subject to the Plan

              	
                3

              
	
                2.5.

              	
                Restrictions
                  on Issuances

              	
                3

              
	
                2.6.

              	
                Compliance
                  with Law

              	
                4

              
	 	 	 
	
                ARTICLE
                  3.

              
	
                FAIR
                  VALUE

              
	 
	
                3.1.

              	
                Definition

              	
                4

              
	 	 	 
	
                ARTICLE 4.

              
	
                GRANT
                  OF OPTIONS

              
	 
	
                4.1.

              	
                Grants

              	
                5

              
	
                4.2.

              	
                Participation
                  Voluntary

              	
                5

              
	
                4.3.

              	
                General
                  Terms of the Option

              	
                5

              
	
                4.4.

              	
                Option
                  Exercise Price

              	
                5

              
	
                4.5.

              	
                Exercise
                  Period of Option

              	
                5

              
	
                4.6.

              	
                Option
                  Agreements

              	
                6

              
	
                4.7.

              	
                Prohibition
                  on Transfer of Options

              	
                6

              
	
                ARTICLE
                  5.

              
	
                EXERCISE
                  OF OPTIONS

              
	 
	
                5.1.

              	
                Method
                  of Exercise of Option

              	
                7

              
	
                5.2.

              	
                Payment
                  of Option Price

              	
                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

              	
                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

              
	
                10.2.

              	
                Submission
                  to Jurisdiction

              	
                10

              
	
                10.3.

              	
                Language
                  of Plan

              	
                11

              
	
                10.4.

              	
                Further
                  Assurances

              	
                11

              


      

       

      SCHEDULES

       

      
        	
                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

              


      


      
        
          
          

        

        
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      LORUS
        THERAPEUTICS INC.

      (the
        “Company”)

      2003
        OPTION PLAN

      (the
        “Plan”)

       

      ARTICLE 1.

      INTERPRETATION

       

      1.1.           Purpose
        of the Plan

       

      The
        purpose of this Plan is to advance the interests of the Company by increasing
        its ability to attract, retain and reward Eligible Persons who are involved
        in
        the development of the Company by providing those Eligible Persons with an
        opportunity to acquire an ownership interest in the Company and aligning
        further
        the interests of those Eligible Persons with the interests of the Company’s
        securityholders.

       

      1.2.           Definitions

       

      1.2.1.           In
        this Plan and its Schedules, the terms set out in Schedule 1.2.1
        (Definitions) will have the meanings given to those terms in that
        schedule.

       

      1.2.2.           Certain
        terms, whose definitions are incorporated by reference from other material,
        are
        set out in Schedule 1.2.2 (Incorporated Definitions).

       

      1.3.           Schedules

       

      The
        following are the schedules attached to this Plan:

       

      
        	
                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

              


      

       

      1.4.           Headings
        and Table of Contents

       

      The
        inclusion of headings and a table of contents in this Plan is for convenience
        of
        reference only and will not affect the construction or interpretation of
        the
        Plan.

       

      1.5.           Gender
        and Number

       

      In
        this Plan, unless the context otherwise requires, words importing the singular
        include the plural and vice versa and words importing gender include all
        genders.

       

      1.6.           Currency

       

      Except
        where otherwise expressly provided, all amounts in this Plan are stated and
        will
        be paid in Canadian currency.

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      1.7.           Invalidity
        of Provisions

       

      Each
        of the provisions contained in this Plan is distinct and severable and a
        declaration of invalidity or unenforceability of any provision or part by
        a
        court of competent jurisdiction will not affect the validity or enforceability
        of any other provision of the Plan.  To the extent permitted by
        applicable law, the Company and all Participants waive any provision of law
        which renders any provision of this Plan invalid or unenforceable in any
        respect.

       

      1.8.           Entire
        Agreement

       

      This
        Plan and each Option Agreement constitutes the entire agreement between the
        parties pertaining to the subject matter of those documents. There are no
        warranties, conditions, or representations (including any that may be implied
        by
        statute) and there are no agreements in connection with the subject matter
        except as specifically set out or referred to in those documents.

       

      1.9.           Governing
        Law

       

      This
        Plan will be governed by and interpreted in accordance with the laws of the
        Province of Ontario and the laws of Canada applicable in Ontario.

       

      1.10.           Effective
        Date

       

      This
        Plan is effective as of September 19, 2007.

       

      ARTICLE 2.

      Administration

       

      2.1.           Administration
        by the Board of Directors

       

      This
        Plan will be administered by the board of directors of the Company or a
        committee of the board of directors duly appointed for this purpose by the
        board
        of directors and consisting of not less than 2 directors.  If a
        committee is appointed for this purpose, all references to the term
“Board” will be deemed to be references to the
        committee.

       

      2.2.           Authority
        of the Board of Directors

       

         Subject
        to this
        Plan, the Board has the authority to:

       

      2.2.1.           grant
        Options to Eligible Persons;

       

      2.2.2.           determine
        the terms of Option grants, including any limitations, restrictions and
        conditions upon those grants, which terms may differ by grant and by
        Participant;

       

      2.2.3.           issue
        Shares upon the exercise of Options;

       

      2.2.4.           effect
        any repurchase of Shares, Options or other rights contemplated by this
        Plan;

       


      
        
          
          

        

        
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      2.2.5.           interpret
        this Plan and adopt, amend or rescind any administrative guideline and other
        rule or Regulation relating to this Plan as it may from time to time consider
        advisable, subject to the Law; and

       

      2.2.6.           make
        all other determinations and take all other actions in connection with the
        implementation and administration of this Plan as it may consider necessary
        or
        advisable.

       

      The
        Board’s guidelines, rules, Regulations, interpretations and determinations will
        be final and binding upon the Company and all Participants and their legal
        representatives.  No member of the Board will be liable for any act or
        omission (whether or not negligent) taken or omitted in good faith, or for
        the
        exercise of an authority or discretion granted in connection with the Plan
        to
        the Board, or for the acts or omission of any other members of the
        Board.

       

      2.3.           Grants
        by CEO

       

      The
        Chief Executive Officer of the Company is authorized to grant Options from
        time
        to time to Eligible Persons between meetings of the Board, subject to the
        ratification and approval of those grants by the Board at the next meeting
        of
        the Board; provided those grants are made in accordance with (1) the terms
        of the Plan and (2) any guidelines set out by the Board. The exercise price
        of
        Options granted in this manner will in all cases be established on the date
        of
        grant by the Chief Executive Officer, in accordance with
        section 4.4.

       

      2.4.           Shares
        Subject to the Plan

       

      2.4.1.           The
        maximum total number of Shares available for issuance from treasury from
        time to
        time upon the exercise of Options granted under the Plan and the Previous
        Stock
        Option Plan, for so long as it exists, is 15% of the issued and outstanding
        Shares of the Corporation.  Any Share subject to an Option that, for
        any reason, has been cancelled or terminated without having been exercised
        under
        the Plan or the Previous Stock Option Plan, will again be available for issuance
        under this Plan. Any exercise of Options will make new grants available under
        the Plan, provided that the maximum number of Shares reserved for issuance
        pursuant to the Plan and the Previous Stock Option Plan, for so long as it
        exists, does not exceed 15% of the number of Shares then issued and
        outstanding.

       

      2.4.2.           No
        fractional Shares may be issued or purchased under the Plan and the Board
        will
        determine the manner in which any fractional Shares or rights to acquire
        fractional Shares are to be addressed.

       

      2.5.           Restrictions
        on Issuances

       

         
        The issuing of Options is subject to the following restrictions:

       

      2.5.1.           the
        number of Shares reserved for issuance under Options granted to Insiders,
        at any
        time, under Stock Options granted to Insiders under this and any other security
        based compensation arrangement of the Company may not exceed 10% of the
        Outstanding Issue;

       


      
        
          
          

        

        
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      2.5.2.           Insiders
        may not, within a 12 month period, be issued a number of Shares under the
        Plan and/or under any other security based compensation arrangement of the
        Company exceeding 10% of the Outstanding Issue;

       

      2.5.3.           any
        one Insider and that Insider’s Associates may not, within a 12 month
        period, be issued a number of Shares under the Plan and/or under any other
        security based compensation arrangement of the Company exceeding 10% of the
        Outstanding Issue; and

       

      2.5.4.           the
        number of Shares reserved for issuance under Options to any one Person may
        not
        exceed 5% of the Outstanding Issue.

       

      2.6.           Compliance
        with Law

       

      2.6.1.           The
        Company is not obligated by this Plan or any grant under it to, and will
        not,
        take any action required, permitted or otherwise contemplated by this Plan
        except in accordance with Law.  The Board may postpone or adjust any
        exercise of any Option or the issue of any Shares under this Plan or refrain
        from taking any action or exercising any right required, permitted or
        contemplated by the Plan as the Board in its discretion may deem necessary
        in
        order to permit the Company to ensure that this Plan and the issuance of
        Shares
        under it comply with Law.

       

      2.6.2.           If
        the Shares are listed on a Stock Market, the Company will have no obligation
        to
        issue any Shares under this Plan unless the Shares have been duly listed,
        upon
        official notice of issuance, on that Stock Market.

       

      2.6.3.           If
        Law prevents the exercise of an Option or the issue of a Share, the Board
        may,
        in addition to the rights referred to in this Plan, choose to address the
        economic value of a Participant’s rights in whatever manner it deems to be
        reasonable in the circumstances, and action taken by the Company in consequence
        of that determination will be deemed to have satisfied the Company’s obligations
        as they would otherwise have existed.

       

      2.6.4.           The
        Company will comply with all reporting obligations required by Law.

       

      ARTICLE
        3.

      FAIR
        VALUE

       

      3.1.           Definition

       

      “Fair
        Value” for the purposes of this Plan will be equal to the weighted
        average of the trading prices of the Shares on the Stock Market for the five
        trading days ending on the last trading date preceding the date on which
        the
        calculation of Fair Value is to be made, provided that:

       

      3.1.1.           “Fair
        Value” for the purpose of determining the exercise price of all Options (other
        than Incentive Options) under section 4.4 will be equal to the closing
        market price of the Shares on the Stock Market on the last trading date
        preceding the date of the grant.  If there is no trading on that date,
        the exercise price will be the average of the bid and ask on the Stock Market
        on
        the last trading date preceding the date of the grant.

       


      
        
          
          

        

        
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            4
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      ARTICLE 4.

      GRANT
        OF OPTIONS

       

      4.1.           Grants

       

      The
        Board may grant Options to Eligible Persons.  An Eligible Person may
        receive Options on more than one occasion under this Plan and may receive
        differing Options on any one occasion.

       

      4.2.           Participation
        Voluntary

       

      The
        participation of an Eligible Person in the Plan and the purchase of Shares
        by a
        Participant upon exercise of an Option is voluntary, and neither the
        participation nor any purchase will have any effect, positively or negatively,
        on the employment or continuing employment of an Eligible Person or Participant
        who is an Employee, the appointment or continuing appointment of an Eligible
        Person or Participant who is an Executive or the engagement or continuing
        engagement of an Eligible Person or Participant who is a Consultant or
        Consultant Entity.

       

      4.3.           General
        Terms of the Option

       

      4.3.1.           In
        respect of each Option, the Board will determine the Eligible Person who
        will
        receive the Option, the number of Shares subject to the Option, the expiration
        date of the Option, the extent to which each Option is exercisable from time
        to
        time during the term of the Option and other terms and conditions relating
        to
        each Option.

       

      4.3.2.           If
        not otherwise determined by the Board, an Option will vest as to 50% on the
        first annual anniversary of the date of grant of the Option and an additional
        25% on the second and third annual anniversaries after the date of the grant
        of
        the Option.

       

      4.4.           Option
        Exercise Price

       

      The
        Board will, in accordance with Law, establish the exercise price of an Option
        when each Option is granted equal to the Fair Value of the Shares as of the
        date
        of grant.

       

      4.5.           Exercise
        Period of Option

       

      4.5.1.           Maximum
        Period.  Options granted must be exercised no later than 10 years
        after the date of grant (or within any lesser period that the applicable
        grant,
        this Plan, Regulations or any Law may require).  No Option may be
        exercised after its stated expiration.

       

      4.5.2.           Notwithstanding
        anything contained herein or in any Option Agreement, if the date on which
        an
        Option expires pursuant to an Option Agreement occurs during, or within 10
        days
        after the last day of, a Black Out Period or other trading restriction imposed
        by the Corporation, the expiry date for the Option will be the last day of
        the
        10-day period.

       

      4.5.3.           Termination.

       

      4.5.3.1.                      If
        a Participant ceases to be an Eligible Person as a result of:

       


      
        
          
          

        

        
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      4.5.3.1.1.                      the
        termination of the Participant’s appointment, employment or engagement by the
        Company (and/or its Affiliates) without Cause,

       

      4.5.3.1.2.                      the
        resignation of the Participant, or

       

      4.5.3.1.3.                      the
        retirement of the Participant,

       

      each
        Option held by the Participant, to the extent which it has vested on or prior
        to
        the Termination Date in accordance with the Option Agreement and this Plan,
        will
        cease to be exercisable 3 months after the Termination Date unless it
        expires sooner or unless otherwise determined by the Board.

       

      4.5.3.2.                      If
        a Participant ceases to be an Eligible Person as a result of the termination
        of
        the Participant’s appointment, employment or engagement by the Company (and/or
        its Affiliates) because of Cause, each Option held by the Participant, to
        the
        extent which it has vested and not expired on or prior to the Termination
        Date
        in accordance with the Option Agreement and this Plan, will cease to be
        exercisable immediately upon the Company’s (and/or an Affiliate’s) giving of
        notice of termination, unless otherwise determined by the Board.

       

      4.5.3.3.                      Effective
        the Termination Date, any portion of an Option that has not vested on or
        prior
        to the Termination Date will expire without any further rights under the
        Plan.

       

      4.5.4.           Death
        or Disability.  If a Participant ceases to be an Eligible Person
        as a result of the Participant’s death or Disability, each Option held by the
        Participant, to the extent which it has vested and not expired on or prior
        to
        the date of the Participant’s death or Disability in accordance with the Option
        Agreement and this Plan, will cease to be exercisable 9 months after the
        Termination Date unless otherwise determined by the Board.  Any
        portion of a Participant’s Option that has not vested on or prior to the date of
        the Participant’s death or Disability will no longer be
        exercisable.

       

      4.6.           Option
        Agreements

       

      Each
        Option must be confirmed, and will be governed, by an Option Agreement signed
        by
        the Company and by the Participant, substantially in the form attached as
        Schedule 4.6 (Form of Option Agreement).

       

      4.7.           Prohibition
        on Transfer of Options

       

      Options
        are personal to the Participant.  No Participant may deal with an
        Option or any interest in it or Transfer an Option except in accordance with
        this Plan. A purported Transfer of an Option in violation of this Plan will
        not
        be valid and the Company will not issue any Share upon the attempted exercise
        of
        that Option.  Subject to Law, the Board may establish rules,
        Regulations and procedures permitting the Transfer of Options in circumstances
        and on terms determined by the Board.  If Options have been granted to
        a Participant’s Subsidiary or a Consultant’s Consultant Entity and the related
        Subsidiary ceases to be a Subsidiary or the related Consultant Entity ceases
        to
        so qualify, then the Participant will be deemed to have Transferred any Option
        held by that entity to the entity, and that Transfer will be subject to the
        requirements and sanctions set out in this section.  Notwithstanding
        anything to the contrary in the Plan, Options cannot be Transferred other
        than
        by will or the laws of descent and distribution and will be exercisable during
        a
        Participant’s lifetime only by the Participant

       


      
        
          
          

        

        
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      ARTICLE
        5.

      EXERCISE
        OF OPTIONS

       

      5.1.           Method
        of Exercise of Option

       

      A
        Participant may exercise all or a portion of an Option by delivering to the
        Company, to the address and person set out in section 10.1, a completed
        exercise form in the form attached as Schedule 5.1 (Exercise Form) and, if
        exercised under section 5.2, accompanied by payment of the exercise price
        multiplied by the number of Shares to be purchased.

       

      5.2.           Payment
        of Option Price

       

      The
        purchase price of each Share purchased under an Option must be paid in full
        at
        the time of exercise by bank draft, certified cheque or in any other manner
        permitted by the Board and by Law.  Upon receipt of payment in full,
        but subject to this Plan, the number of Shares in respect of which the Option
        is
        exercised will be issued as fully paid and non-assessable.

       

      5.3.           Withholding
        of Tax

       

      5.3.1.           If
        the Company determines that under the requirements of taxation Law it is
        obliged
        to withhold for remittance to a taxing authority any amount upon exercise
        of an
        Option or the sale of Shares acquired on exercise of an Option, the Company
        may,
        prior to and as a condition of issuing the Shares or at any other later date,
        (1) require the Participant exercising the Option to pay to the Company, in
        addition to and in the same manner as the exercise price for the Shares,
        (2) withhold from any other amounts payable by the Company to the
        Participant or (3) transfer from the Participant to the Company Shares
        issuable upon exercise of the Option having a Fair Value equal to, any amount
        that the Company is obliged to remit to that taxing authority in respect
        of the
        exercise of the Option or the sale of the Shares acquired on exercise of
        the
        Option.  Any additional payment will, in any event, be due no later
        than the date as of which any amount with respect to the Option exercised
        must
        be included in the gross income of the Participant for tax
        purposes.

       

      5.3.2.           Promptly
        after a Participant sells any Shares acquired on exercise of an Option, the
        Participant will notify the Company in writing of the date and terms of the
        sale
        and will provide all other information regarding the sale as the Company
        may
        reasonably require.

       


      
        
          
          

        

        
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      ARTICLE
        6.

      SHARES

       

      6.1.           Shareholder
        Rights

       

      A
        Participant will not have any rights as a shareholder of the Company with
        respect to any Shares subject to an Option until that Participant has exercised
        the Option and the Company has issued Shares in accordance with the
        Plan.

       

      ARTICLE 7.

      REORGANIZATIONS
        AND ADJUSTMENTS

       

      7.1.           Reorganization
        or Sale of the Company

       

         
        If there is:

       

      7.1.1.           a
        Combination,

       

      7.1.2.           the
        sale, lease, transfer or other disposition of all or substantially all of
        the
        assets of the Company, or

       

      7.1.3.           a
        reorganization or liquidation of the Company,

       

      the
        Board, or the board of directors of any entity assuming the obligations of
        the
        Company, having regard to its fiduciary duties and the best interests of
        the
        Company, will, as to unexercised Options, upon written notice to Participants,
        provide that: (a) all unvested Options of Executives will vest immediately;
        (b)
        all unexercised Options (both vested and unvested) will terminate immediately
        prior to the consummation of the merger, consolidation, acquisition,
        reorganization, liquidation, sale or transfer unless those Options which
        have
        vested are exercised by respective Participants within 30 days following
        the
        date of the notice.

       

      7.2.           Substitute
        Options upon Acquisition by the Company

       

      The
        Company may grant Options under the Plan in substitution for options held
        by
        directors, officers or employees of or consultants to another entity who
        become
        Eligible Persons as a result of a merger or consolidation of the other entity
        with the Company or an Affiliate, or as a result of the acquisition by the
        Company of property or securities of the other entity.  The Company
        may direct that substitute Options be granted on any terms and conditions
        that
        the Board considers appropriate in the circumstances, subject to
        Law.

       

      7.3.           Capital
        Adjustments

       

      If
        there is any change in the outstanding Shares by reason of a share dividend
        or
        split, recapitalization, consolidation, combination or exchange of shares,
        special dividend or other fundamental corporate change, other than the issuance
        of Shares by the Company for consideration, the Board will, subject to Law,
        make
        a substitution or adjustment in

       

      7.3.1.           the
        exercise price of any unexercised Options;

       


      
        
          
          

        

        
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            8
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      7.3.2.           the
        maximum number and/or class of securities of the Company reserved for issuance
        under this Plan; or

       

      7.3.3.           the
        number and/or class of securities of the Company subject to unexercised Options
        previously granted,

       

      as
        the Board determines is appropriate in the circumstances.

       

      ARTICLE 8.

      Employment
        and Compensation

       

      8.1.           No
        Special Employment Rights

       

      Nothing
        contained in the Plan or in any Option will confer upon any Participant any
        right with respect to the continuation of the Participant’s appointment,
        employment or engagement by the Company or interfere in any way with the
        right
        of the Company at any time to terminate or change any terms of that appointment,
        employment or engagement including any increase or decrease in the compensation
        of the Participant.

       

      8.2.           Other
        Employee Benefits

       

      The
        amount of any compensation deemed to be received by a Participant as a result
        of
        the exercise of an Option or the sale of Shares received upon an exercise
        of an
        Option will not constitute compensation for the purpose of determining any
        other
        employee benefits of that Participant, including benefits under any bonus,
        pension, profit-sharing, life insurance or salary continuation plan, except
        as
        otherwise specifically determined by the Board.

       

      8.3.           Non-Exclusivity

       

      Nothing
        contained in this Plan will prevent the Board from adopting other or additional
        compensation arrangements for the benefit of any Participant or other Eligible
        Person, subject to Law.

       

      ARTICLE 9.

      Amendments

       

      9.1.           Amendment
        or Termination Without Consent

       

      9.1.1.           The
        Board reserves the right, in its sole discretion, to amend, suspend or terminate
        the Plan or any portion thereof at any time, in accordance with applicable
        legislation, without obtaining the approval of shareholders.  Any
        amendment to any provision of the Plan will be subject to any required
        regulatory or shareholder approval.  Notwithstanding the foregoing,
        the Company will be required to obtain the approval of the shareholders of
        the
        Company for any amendment related to:

       

      9.1.1.1.                      the
        maximum number of Shares reserved for issuance under the Plan (and under
        any
        other security based compensation arrangements of the Company);

       


      
        
          
          

        

        
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      9.1.1.2.                      a
        reduction in the exercise price for Options held by Insiders;

       

      9.1.1.3.                      an
        extension to the term of Options held by Insiders; and

       

      9.1.1.4.                      the
        increase in the 10% limits on grants to Insiders set out in Sections 2.5.2
        and
        2.5.3 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 Participants who are Insiders.

       

      9.1.2.           If
        this Plan is terminated, the provisions of this Plan, the Regulations and
        any
        administrative guidelines and other rules adopted by the Board and in force
        when
        this Plan is terminated will continue in effect as long as any Option, or
        any
        right under an Option, remains outstanding.  However, notwithstanding
        the termination of this Plan, the Board may make any amendments to this Plan,
        or
        to any outstanding Option, that it would be entitled to make if this Plan
        were
        still in effect.

       

      9.2.           Amendment
        With Individual Consent

       

      With
        the consent of the affected Participant, the Board may amend any outstanding
        Option in any manner to the extent that the Board would have had the initial
        authority to grant the Option as so modified or amended, including to change
        the
        date or the price at which an Option becomes exercisable, subject to
        Law.

       

      ARTICLE 10.

      GENERAL
        MATTERS

       

      10.1.           Notices

       

      Any
        notice or other communication required or permitted to be given under this
        Plan
        will be in writing and will be given by prepaid first-class mail, by electronic
        mail or by hand-delivery as provided below.  Any notice or other
        communication, if mailed by prepaid first-class mail at any time other than
        during a general discontinuance of postal service due to strike, lockout
        or
        otherwise, will be deemed to have been received on the fourth Business Day
        after
        the post-marked date, or if sent by electronic mail, will be deemed to have
        been
        received on the Business Day following the sending, or if delivered by hand
        will
        be deemed to have been received on the day on which it is delivered to the
        applicable address noted below either to the individual designated below
        or to
        an individual at that address having apparent authority to accept deliveries
        on
        behalf of the addressee.  Notice of change of address will also be
        governed by this section.  Notices and other communications will be
        addressed, if to the Company, to the head office of the Company,
        attention:  Corporate Secretary and, if to a Participant, at the last
        address which appears on the records of the Company.

       

      10.2.           Submission
        to Jurisdiction

       

      The
        Company and each Participant irrevocably submit to the non-exclusive
        jurisdiction of the courts of Ontario in respect of all matters relating
        to this
        Plan and any Option Agreement.

       


      
        
          
          

        

        
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      10.3.           Language
        of Plan

       

      The
        parties to this Plan have expressly agreed that this Plan and related documents
        be drawn in the English language.  Les parties aux présentes ont
        expressément convenu que le présent plan et tous les documents y afférents
        soient rédigés en langue anglaise.

       

      10.4.           Further
        Assurances

       

      Each
        Participant will promptly do, make, execute or deliver, or cause to be done,
        made, executed or delivered, all further acts, documents and things as the
        Company may reasonably require from time to time for the purpose of giving
        effect to this Plan and will use reasonable efforts and take all steps as
        may be
        reasonably within the Participant’s power to implement to their full extent the
        provisions of this Plan.

       

      


       


      
        
          
          

        

        
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            11
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      SCHEDULE 1.2.1

       

      Definitions

       

      
        	
                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.

              	
                “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.

              


      

       

      


       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      SCHEDULE 1.2.2

       

      Incorporated
        Definitions

       

      The
        definitions in this schedule have been substantially reproduced from the
        statutory, regulatory or other material in force as of •, 2007 and from which
        they have been incorporated. This Schedule will be deemed to be updated from
        time to time, as applicable, as that material is updated, and a replacement
        version will be distributed to Participants as soon as practicable
        thereafter.

       

      
        	
                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.

              


      

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      SCHEDULE 2.2.5

       

      Regulations

       

      
        	
                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.

              


      

       

      For
        greater certainty, the above dates will apply whether or not the Participant
        receives any payment in lieu of notice.  For greater certainty, if, as
        a result of one or more of the events listed above, a Participant no longer
        qualifies or will no longer qualify as an Eligible Person in one category
        but
        will remain an Eligible Person under another category, then the Participant
        will
        remain an Eligible Person.

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      
        	
                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.

              


      

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      SCHEDULE 4.6

       

      Form
        of Option Agreement

       

      LORUS
        THERAPEUTICS INC.

      2007
        SHARE OPTION PLAN

       

      •{DATE}

       

      PERSONAL
        & CONFIDENTIAL

       

      •{NAME}

      •{ADDRESS}

       

      Dear
        •{NAME}:

       

      Grant
        of Option

       

      I
        am very pleased to advise you that the Board of Directors of Lorus Therapeutics
        Inc. (the “Company”) has granted to you an option (the “Option”) to purchase
        common shares (the “Shares”) of the Company.  This Option was granted
        on the basis set out in this letter, and is subject to the 2007 Share Option
        Plan of the Company (the “Plan”), a copy of which is enclosed.  This
        letter and the Plan are referred to collectively as the “Option
        Documents”.  All capitalized terms not otherwise defined in this
        letter have the meanings given to them in the Plan.

       

      
        	
                Date
                  of grant of Option:

              	 
	 	 
	
                The
                  total number of Shares subject to this Option is:

              	 
	 	 
	
                The
                  exercise price of this Option is:

              	
                $

              


      

       

      Vesting
        of Options

       

      Your
        Options will “vest” or become exercisable

       

      in
        accordance with the table set out below.  Provided that you are an
        Eligible Person and have been an Eligible Person throughout the time period
        set
        out in Column 1, the number of Options set out in Column 2 will vest
        at 11:59 p.m. on the last day of that time period.  The number of
        Options you may exercise at any time (prior to the expiry date set out below)
        will be equal to the total number of Options which have vested, less any
        Options
        which you have exercised or which have expired in accordance with the Option
        Documents.

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      


       

      
        	
                Column
                  1

              	 	
                Column
                  2

              
	
                Time

                Period

              	 	
                Number
                  of Options

                vesting
                  following

                that
                  time period

              
	 	 	 	 	 
	
                 

                 

              	
                to

              	 	 	 
	
                 

                 

              	
                to

              	 	 	 
	 	
                 

                to

              	 	 	 


      

      


       

      •[OTHER
        CONDITIONS APPLICABLE TO VESTING, SUCH AS ATTAINING CERTAIN PERFORMANCE
        GOALS]

       

      Expiry
        of Option

       

      Subject
        to earlier expiration in accordance with the Option Documents, your rights
        to
        purchase Shares under this Option will expire at 11:59 p.m. on:

       

      ___________________________________________________________________


    
      


      Exercise
        of Option

       

      This
        Option may be exercised in whole or in part in respect of the vested portion
        of
        the Option at any time prior to expiry of the Option by delivery of written
        notice in a form attached to the Plan to the address and person set out in
        the
        Plan by exercising all or part of the vested portion of the Option for a
        number
        of Shares specified to be purchased and enclosing payment by bank draft or
        certified cheque of the total purchase price of the Shares.

       

      This
        Option may not be exercised or
        surrendered in respect of amounts of less than 100 Shares in the case of
        any one exercise unless that exercise would exhaust the Option.

       

      Tax
        Consequences

       

      Receiving
        a grant of an Option, exercising an Option and selling Shares received upon
        exercise of an Option may all result in tax consequences, which will differ
        depending on your jurisdiction of residence.  The Company may impose
        requirements in relation to your exercise of an Option or subsequent sale
        of
        Shares issued upon exercise of an Option, to ensure compliance with taxation
        laws related to withholdings and remittances. You are strongly urged to consult
        your tax advisor as to the various tax consequences.

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      Options
        and Your Service to the Company

       

      Nothing
        in the Option Documents will affect the right of the Company to terminate
        your
        services, responsibilities or duties to the Company and its Affiliates at
        any
        time for any reason.  Regardless of the reason for your termination,
        your rights to exercise this Option will be restricted to those rights which
        have vested and not expired on or prior to your Termination Date and, in
        any
        claim for wrongful dismissal, no consideration will be given to any Options
        that
        might have vested during an appropriate notice period, all as described in
        the
        Plan.  As set out the Plan, your participation in the Plan and any
        purchase of Shares upon exercise of an Option is voluntary, and neither the
        participation nor any purchase will have any effect, positively or negatively,
        on your appointment, employment or engagement by the Company.

       

      No
        Transfers

       

      This
        Option is personal to you alone and may not be sold or Transferred in any
        way,
        except as described in the Plan.

       

      Decisions
        of Board Binding

       

      All
        decisions made by the Board of Directors with regard to any questions arising
        in
        connection with the Option Documents, whether of interpretation or otherwise,
        will be final and binding on all parties.

       

      Acceptance
        of Option

       

      Please
        indicate acceptance of this agreement by signing where indicated below on
        the
        enclosed copy of this letter and returning the signed copies to the Company
        to
        the attention of Corporate Secretary.

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      
         

        
          
            	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.


          

        

         

         

         

        


      

                                                                              Yours
        truly,

       

                                                                              LORUS
        THERAPEUTICS
        INC.

       

      


       

                                                                              By:                                                                                           

       

       

      I
        have read and agree to be bound by this letter and the Plan.

       

      
        	
                Signature:

              	 	 
	
                 

                Name
                  (print):

              	 	 
	
                 

                Address:

              	 	 
	
                 

                 

              	 	 
	
                 

                Date:

              	 	 
	
                 

                Witness
                  Signature:

              	 	 
	
                 

                Witness
                  Name print):

              	 	 


      

      


       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      SCHEDULE 5.1

       

      Exercise
        Form

       

      LORUS
        THERAPEUTICS INC.

      2007
        SHARE OPTION PLAN

       

      SHARE
        OPTION

      EXERCISE
        AND SUBSCRIPTION FORM

       

      
        	
                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

              
	 	 


      

       

      Under
        an option agreement dated
        ________________ , I was granted an option (the “Option”) to purchase a
        total of ________ Shares.  At this date, a portion of the Option
        has vested entitling me to purchase ________ Shares, of which I have
        already purchased ________ Shares in total under one or more prior exercise
        and subscription forms.

       

      I
        give notice that I wish
        to:

       

      
        	
                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

              


      

       

      o    a
        certificate
        representing the subscribed Shares be delivered to me at the address set
        out
        below;

       

      o    a
        certificate
        representing the subscribed Shares be delivered to me at my office;
        or

       

      o    the
        subscribed Shares
        be deposited directly into my broker account (see account details below),
        and I
        hereby authorize Computershare Trust Company of Canada, or such other registrar
        and transfer agent as the Company may appoint from time to time;

       

      or

       

      
        	
                 

              	
                •

              	
                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.

              


      

       


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      All
        capitalized terms used in this
        exercise and subscription form and not otherwise defined have the meanings
        given
        to them in the Plan.

       

      
        	
                Signature:

              	 	 
	
                 

                Name
                  (print):

              	 	 
	
                 

                Address:

              	 	 
	
                 

                 

              	 	 
	
                 

                Date:

              	 	 
	
                 

                Broker
                  account

                details: