Document:

MERGER AGREEMENT, DATED AS OF OCTOBER 2, 2002

 EXHIBIT 4.6 
  
 MERGER AGREEMENT 
  
 THIS MERGER AGREEMENT dated as of October 2, 2002 (the “Agreement”) is made by and among ADHEREX TECHNOLOGIES INC., a
corporation amalgamated under the Canada Business Corporations Act (“Adherex”), ADHEREX, INC., a Delaware corporation and a wholly owned subsidiary of Adherex (“Adherex US”), and OXIQUANT, INC., a
Delaware corporation (the “Company”). 
  
 WHEREAS the respective Boards of Directors of Adherex (the “Adherex Board”), Adherex US (the “Adherex US Board”) and the Company (the “Company Board”) have each determined that it is
in the best interests of their respective shareholders and/or stockholders, as may be applicable, for Adherex to acquire the Company upon the terms and subject to the conditions set forth herein; 
  
 AND WHEREAS in furtherance of such acquisition, Adherex Board, Adherex
US Board and the Company Board have each approved the merger of Adherex US with and into the Company (the “Merger”) in accordance with the General Corporation Law of the State of Delaware (“Delaware Law”) and upon
the terms and subject to the conditions set forth herein; 
  
 AND WHEREAS the Stockholder’s Representative has been appointed as the representative of the Stockholders (as hereinafter defined) in order to satisfy the requirements of Article IX hereof and the Stockholders’
Representative has accepted such appointment; 
  
 AND
WHEREAS for United States Federal income tax purposes, it is intended that the Merger shall qualify as a reorganization within the meaning of Section 368 of the Tax Code; 
  
 AND WHEREAS certain capitalized terms used in this Agreement bear the definitions provided therefor in Section 10.8
hereof; 
  
 NOW THEREFORE in consideration of the foregoing
and the mutual covenants and agreements herein contained, and intending to be legally bound hereby, Adherex, Adherex US and the Company hereby agree as follows: 
  
 ARTICLE I 
 THE MERGER 
  
 1.1 The Merger. At the Effective Time
(as defined hereinafter) and subject to, and upon the terms and conditions of, this Agreement and Delaware Law, Adherex US shall merge with and into the Company, the separate corporate existence of Adherex US shall cease and the Company shall
continue as the surviving corporation. The Company as the surviving corporation after the Merger is hereinafter sometimes referred to as the “Surviving Company.” Following the Merger, the Surviving Company shall be a wholly owned
subsidiary of Adherex. It is intended that the Merger constitute a tax-free reorganization under Section 368(a)(2)(E) of the Tax Code and, by executing this Agreement, the parties intend to adopt a plan of reorganization within the meaning of
Section 368 of the Tax Code. 
  
 1.2 Effective Time. As promptly as
practicable after the satisfaction or waiver of the conditions set forth in Article VI hereof, the parties hereto shall cause the Merger to be consummated by filing a Certificate of Merger in the form attached as Exhibit “A” hereto (the
“Certificate of Merger”) with the Secretary of State of the State of Delaware, in such form as required by, and executed in accordance with the relevant provisions of, Delaware Law (the time of such filing being the
“Effective Time”). 

 1.3 Effect of the Merger. At the Effective Time, the Merger shall have all effects as provided in the applicable
provisions of Delaware Law. Without limiting the generality of the foregoing, and subject to the provisions of this Agreement, at the Effective Time all the property, rights, privileges, powers and franchises of the Company and Adherex US shall vest
in the Surviving Company, and all debts, liabilities, obligations and duties of the Company and Adherex US shall become the debts, liabilities, obligations and duties of the Surviving Company. 
  
 1.4 Certificate of Incorporation; By-Laws. Unless otherwise determined by Adherex and
the Company prior to the Effective Time, at the Effective Time the Certificate of Incorporation of the Company, as amended pursuant to the Certificate of Merger, shall be the Certificate of Incorporation of the Surviving Company until thereafter
amended as provided by law and such Certificate of Incorporation and the By-laws of the Company shall be the By-laws of the Surviving Company until thereafter amended as provided by Delaware Law, the Certificate of Incorporation of the Surviving
Company and such By-laws. 
  
 1.5 Directors and Officers. The sole director
of Adherex US immediately prior to the Effective Time shall be the initial director of the Surviving Company, to hold office in accordance with the Certificate of Incorporation and By-laws of the Surviving Company, and the officers of Adherex US
immediately prior to the Effective Time shall be the initial officers of the Surviving Company, in each case until their respective successors are duly elected or appointed and qualified. 
  
 1.6 Effect on Company Capital Stock. At the Effective Time and following the Share Consolidation, by virtue of the Merger and, except
as provided herein, without any action on the part of Adherex US, Adherex, the Company or the Stockholders, the following shall be deemed to have occurred: 
  

	(a)	Each share of Common Stock of the Company issued and outstanding immediately prior to the Effective Time, other than shares of Common Stock to be cancelled pursuant to Section
1.6(b) hereof and any Dissenting Shares (as defined and to the extent provided for in Section 1.7 hereof), shall automatically convert into and be exchangeable for: (i) such number of fully paid and non-assessable Common Shares (as defined in
Section 3.3 hereof) equal to the product resulting from multiplying one (1) times the Exchange Ratio (such Common Shares, the “Merger Shares”), and (ii) a fully paid and non-assessable warrant, in the form attached hereto as Exhibit
“B,” to purchase the number of Common Shares equal to the product resulting from multiplying one (1) times the Warrant Exchange Ratio at a price equal to the Warrant Purchase Price (each, a “Merger Warrant” and, together
with the Merger Shares, the “Merger Securities”); 

  

	(b)	Each share of Common Stock held in the treasury of the Company and each share of Common Stock owned by Adherex US, Adherex or any direct or indirect wholly owned subsidiary of
Adherex or of the Company immediately prior to the Effective Time shall be cancelled and extinguished without any conversion thereof; 

  

	(c)	Each share of common stock, $.001 par value of Adherex US (the “Subsidiary Common Stock”), issued to Adherex and outstanding immediately prior to the Effective
Time, which shall be the only shares of capital stock of Adherex US outstanding prior to the Effective Time and shall be owned by Adherex at the Effective Time, shall be converted into and exchanged for one (1) validly issued, fully paid and
non-assessable share of common stock, par value $0.001 per share, of the Surviving Company and shall constitute at the Effective Time all of the issued and outstanding capital stock of the Surviving Company; 

  

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	(d)	The Exchange Ratio and Warrant Exchange Ratio shall be adjusted to reflect fully the effect of any stock split, reverse split, stock dividend (including any dividend or distribution
of securities convertible into Common Shares), reorganization, recapitalization or other like change with respect to Common Shares occurring after the Effective Time; and 

  

	(e)	No fraction of a Merger Share will be issued, but rather the number of Merger Shares to which any Stockholder is entitled shall be rounded down to the nearest whole share.

  
 1.7 Dissenting Shares. Notwithstanding any provisions of
this Agreement to the contrary, any shares of capital stock of the Company outstanding immediately prior to the Effective Time held by any person that has not consented to the Merger and has demanded and perfected such person’s right of
appraisal of such shares in accordance with Delaware Law and who, as of the Effective Time, has not effectively withdrawn or lost such right to appraisal (such person a “Dissenting Stockholder” and such shares, the
“Dissenting Shares”), shall not be converted into or represent a right to receive Merger Securities pursuant to Section 1.6 hereof, but such holder shall only be entitled to such rights as are granted by Delaware Law.
Notwithstanding the foregoing, if any holder of shares of capital stock of the Company who demands appraisal of such Dissenting Shares under Delaware Law shall effectively withdraw or lose (through failure to perfect or otherwise) such holder’s
right to appraisal, then, as of the later of the Effective Time or the occurrence of such event, such holder’s shares shall automatically be converted into and represent only the right to receive Merger Securities pursuant to Section 1.6
hereof, without interest thereon, upon surrender of the certificate or certificates representing such shares. The Company shall give Adherex prompt notice of any written demands for appraisal of any shares of capital stock of the Company,
withdrawals of such demands and any other instruments served pursuant to Delaware Law and received by the Company. The Company shall give to Adherex the opportunity to participate in all negotiations and proceedings with respect to demands for
appraisal under Delaware Law hereunder. The Company shall not, except with the prior written consent of Adherex (which consent shall not be unreasonably withheld), voluntarily make any payment with respect to any demands for appraisal of any capital
stock of the Company or offer to settle or settle any such demands. 
  
 1.8
Surrender of Company Certificates. 
  

	(a)	Prior to the Effective Time, Adherex shall designate a bank or trust company (or other person acceptable to Adherex and the Company) to act as exchange agent (the “Exchange
Agent”) in the Merger, which may be its registrar and transfer agent. 

  

	(b)	At the Effective Time, Adherex shall make available to the Exchange Agent for exchange in accordance with this Article I, through such reasonable procedures as Adherex may adopt,
the Merger Securities issuable pursuant to Section 1.6 hereof in exchange for outstanding shares of Common Stock. 

  

	(c)	Promptly after the Effective Time, Adherex shall cause the Exchange Agent to mail to each holder of record of a certificate or certificates (the “Company
Certificates”) which immediately prior to the Effective Time represented outstanding shares of Common Stock whose shares were converted into the right to receive Merger Securities pursuant to Section 1.6 hereof: 

  

	 	(i)	a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Company Certificates shall pass, only upon delivery of the Company
Certificates to the Exchange Agent and shall be in such form and have such other provisions as Adherex may reasonably specify); and 

	

  

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	 	(ii)	instructions for use in effecting the surrender of the Company Certificates for cancellation to the Exchange Agent or to such other agent or agents as may be appointed by Adherex.
Upon surrender of the Company Certificates to the Exchange Agent, together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto, the holder of such Company Certificate shall be entitled to
receive in exchange therefor a certificate representing the number of whole Merger Shares and Merger Warrants which such holder has the right to receive pursuant to Section 1.6 hereof (the “Adherex Certificates”), and the Company
Certificate so surrendered shall forthwith be cancelled. Until so surrendered, each outstanding Company Certificate that, prior to the Effective Time, represented shares of Common Stock will be deemed from and after the Effective Time, for all
corporate purposes to evidence the ownership of the number of Merger Securities into which shares of Common Stock shall have been so converted in accordance with Section 1.6 hereof. 

  

	(d)	No dividends or other distributions declared or made after the Effective Time with respect to Common Shares with a record date on or after the Effective Time will be paid to the
holder of any unsurrendered Company Certificate with respect to Merger Shares represented thereby until the holder of record of such Company Certificate shall surrender such Company Certificate. Subject to applicable law, following surrender of any
such Company Certificate, there shall be paid to the record holder of the certificates representing whole Merger Shares issued in exchange therefor, without interest, at the time of such surrender, the amount of dividends or other distributions with
a record date after the Effective Time theretofore paid with respect to such Merger Shares. 

  

	(e)	If any certificate for Merger Shares or Merger Warrants is to be issued in a name other than that in which the Company Certificate surrendered in exchange therefor is registered, it
will be a condition of the issuance thereof that (i) the Company Certificate so surrendered will be properly endorsed and otherwise in proper form for transfer, (ii) that the person requesting such exchange will have paid to Adherex, or any agent
designated by it, any transfer or other taxes required by reason of the issuance of a certificate for Merger Shares or Merger Warrants in any name other than that of the registered holder of the certificate surrendered, or established to the
satisfaction of Adherex or any agent designated by it that such tax has been paid or is not payable and (iii) that an opinion shall have been delivered to Adherex on behalf of the transferor to the effect that such transfer will not violate any
applicable securities laws. 

  

	(f)	Notwithstanding anything to the contrary in this Section 1.8, none of the Exchange Agent, the Surviving Company or any party hereto shall be liable to a Stockholder for any amount
properly paid to a public official pursuant to any applicable abandoned property, escheat or similar law. 

  
 1.9 No Further Ownership Rights in Common Stock. All Merger Securities issued upon the surrender for exchange of shares of Common Stock in accordance with the
terms hereof shall be deemed to have been issued in full satisfaction of all rights pertaining to such shares of Common Stock, and there shall be no further registration of transfers on the records of the Company of shares of Common Stock which are
outstanding immediately prior to the Effective Time. If, after the Effective Time, Company Certificates are presented to the Surviving Company for any reason, they shall be cancelled and exchanged for Merger Securities as provided in this Article I
and appropriately entered into the stock ledger of the Surviving Company. 
  

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 1.10 Lost, Stolen or Destroyed Company Certificates. In the event any Company Certificates shall have been lost,
stolen or destroyed, the Exchange Agent shall issue in exchange for such lost, stolen or destroyed certificates, upon the making of an affidavit of that fact by the holder thereof and providing such indemnity as required by the Exchange Agent, such
Merger Securities, as may be required pursuant to Section 1.6 hereof, provided, however, that Adherex may, if required by the Exchange Agent and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed
certificates to deliver a bond in such sum as the Exchange Agent may direct as indemnity against any claim that may be made against Adherex or the Exchange Agent with respect to the certificates alleged to have been lost, stolen or destroyed.

  
 1.11 Taking Necessary Action; Further Action. If, at any time after the
Effective Time, any such further action is necessary or desirable to vest the Surviving Company with full right, title and possession to all assets, property, rights, privileges, powers and franchises of the Company and Adherex US, the officers and
directors of the Surviving Company are fully authorized in the name of the Company and Adherex US to take, and will take, all such lawful and necessary action. 
  

ARTICLE II  
 REPRESENTATIONS AND WARRANTIES OF THE COMPANY 
  
 In order to induce each of Adherex and Adherex US to enter into this Agreement and consummate the transactions contemplated hereby, the Company hereby represents and warrants to Adherex and Adherex US as follows: 
  
 2.1 Organization and Good Standing. The Company is a corporation duly incorporated,
organized, validly existing and in good standing under Delaware Law. The Company has all requisite corporate power and authority to own or lease and operate its properties, to carry on its business as presently conducted. The Company is duly
licensed or qualified to do business as a foreign corporation in each jurisdiction wherein the character of its property or the nature of the activities presently conducted by it, makes such qualification necessary, except where the failure to be so
licensed or qualified would not have, or be reasonably likely to have, a Material Adverse Effect. The Company is not in violation of any term or provision of its certificate of incorporation (the “Certificate of Incorporation”) or
by-laws (the “By-Laws”) as in effect as of this date. The Company is not subject to any reporting requirements of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”). 
  
 2.2 Authorization and Non-Contravention. This Agreement is a valid and binding
obligation of the Company, enforceable in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar laws, from time to time in effect, which affect enforcement of
creditors’ rights generally. The Company has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate or other action of the Company and no other corporate proceedings on the part of the Company are necessary to approve this Agreement and to
consummate any of the transactions contemplated hereby, other than the adoption of this Agreement by the Stockholders in accordance with Delaware Law. The Company Board has, as of the date hereof, approved and deemed this Agreement to be advisable
and determined that the Merger is fair to and in the best interest of the Company and the Stockholders. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not: (a) violate,
conflict with or result in a default under any contract or obligation to which the Company is a party or by which it or its assets are bound, or any provision of the Certificate of Incorporation or By-Laws, or cause the creation of any lien or
encumbrance upon any of the assets of the Company, except 
  

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 for those which would not have, or be reasonably likely to have, a Material Adverse Effect; (b) violate or result in a
violation of, or constitute a default (whether after the giving of notice, lapse of time or both) under, any provision of any law, regulation or rule, or, to the knowledge of the Company, any order of, or any restriction imposed by any court or
other governmental agency applicable to any of the Company, except for those which would not have, or be reasonably likely to have, a Material Adverse Effect; (c) require from the Company any notice to, declaration or filing with, or consent or
approval of any governmental authority or other third party other than pursuant to applicable securities laws (including, without limitation, U.S. “blue sky” laws); or (d) accelerate any obligation under, or give rise to a right of
termination of, any agreement, permit, license or authorization to which the Company is a party or by which it is bound, except for those which would not have, or be reasonably likely to have, a Material Adverse Effect. 
  
 2.3 Authorized and Outstanding Shares. As of the date hereof, the authorized capital
of the Company consists of 10,000,000 shares of common stock, par value $.001 (the “Common Stock”), and 5,000,000 shares of preferred stock. As of the date hereof, there are (i) 5,255,000 shares of Common Stock, all of which are
validly issued and outstanding and none of which are subject to escrow or pooling agreements, and (ii) no shares of preferred stock issued or outstanding. All of the issued and outstanding shares in the capital stock of the Company have been
offered, issued and sold in compliance with applicable securities laws. As of the date hereof, the issued and outstanding shares in the capital stock of the Company are held beneficially and of record by the persons identified in Schedule 2.3 hereto
in the amounts indicated thereon. All of the issued and outstanding shares of Common Stock were duly authorized and validly issued and are fully paid and non-assessable and are fee of any liens or encumbrances created by or resulting from the
actions of the Company and are not subject to pre-emptive rights or rights of first refusal created by statute, the Certificate of Incorporation, the By-Laws or any agreement to which the Company is a party or by which it is bound. None of the
shares of Common Stock are listed on any stock exchange. 
  
 2.4 Options,
etc. Schedule 2.4 hereto sets forth the name of each holder of subscriptions, options, warrants, convertible securities, calls, commitments, agreements or obligations or any character or rights or obligations capable of becoming any of the
foregoing, calling for the purchase, redemption or issuance of any shares of capital stock of the Company and any other securities of the Company or otherwise exercisable or exchangeable into shares of capital stock of the Company (collectively,
“Rights”), the number and class or series of shares of capital stock for which such Rights are so exercisable or exchangeable with respect to each holder, along with the applicable vesting schedule, if any, and the exercise price
thereof. All of the issued and outstanding Rights have been offered, issued and sold in compliance with applicable securities laws. Except as disclosed in Schedule 2.4 or otherwise reflected on Schedule 2.3, there are no outstanding subscriptions,
options, warrants, agreements, arrangements or commitments of any kind for or relating to the issuance, or sale of, or outstanding securities convertible into or exchangeable for, any shares of capital stock of any class or other equity interests in
the Company. 
  
 2.5 Agreements with Stockholders. Except as set forth in
Schedules 2.4 or 2.5 hereto: (i) the Company does not have any obligation to purchase, redeem, or otherwise acquire any shares of capital stock of the Company or any interests therein or to pay any dividend or to make any distribution in respect
thereof; (ii) there are no pre-emptive rights, rights of first refusal, put or call rights or obligations or anti-dilution rights with respect to the issuance, sale or redemption of any shares of capital stock of the Company. Except as set forth on
Schedule 2.4, there are no rights to have shares of capital stock of the Company registered for sale to the public pursuant to the laws of any jurisdiction, and there are no agreements of which the Company is aware relating to the voting of the
Company’s voting securities or restrictions on the transfer of shares of capital stock of the Company. 
  

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 2.6 Subsidiaries. The Company does not own or control, directly or indirectly, any interest in any other
corporation, partnership, limited liability company, association or other business entity. 
  
 2.7 Financial Statements. The Company has delivered to Adherex and Adherex US those financial statements copies of which are attached hereto as Schedule 2.7 hereto (collectively, the “Financial
Statements”). The Financial Statements have been prepared in accordance with United States generally accepted accounting principles as in effect from time to time (“US GAAP”), applied consistently during the periods covered
thereby, and present fairly in all material respects the financial condition of the Company at the dates of said statements and the results of its operations for the periods covered thereby. 
  
 2.8 Absence of Undisclosed Liabilities. Except as stated or adequately reserved
against in the Financial Statements, incurred as a result of or arising out of the transactions contemplated under the Transaction Documents or as set forth in Schedule 2.8 hereto, the Company does not have any liability or obligation of any nature,
whether accrued, absolute, contingent or otherwise, asserted or unasserted, known or unknown, in any case which has, or is reasonably likely to have, a Material Adverse Effect. The Company has not assumed, guaranteed, endorsed or otherwise become
directly or contingently liable on or for any indebtedness of any other person. 
  
 2.9 Absence of Certain Developments. Since December 31, 2001, except as set forth on Schedule 2.9, the Company has conducted its business only in the ordinary course consistent with past practice and except for general industry and
economic conditions, there has been (a) no change in the respective condition (financial or otherwise) of the Company, or in the assets, liabilities, business or prospects of the Company that has or is reasonably likely to have a Material Adverse
Effect, (b) no declaration, setting aside or payment of any dividend or other distribution with respect to, or any direct or indirect redemption or acquisition of, any of the shares of capital stock of the Company, (c) no issuance of any shares of
the capital stock of the Company or any direct or indirect redemption, purchase or other acquisition of any of the capital stock or other equity securities of the Company, (d) no waiver of any valuable right of the Company or cancellation of any
material debt or claim held by the Company, (e) no discharge or satisfaction by the Company of any material lien or encumbrance or payment by the Company of any obligation or liability (fixed or contingent), (f) no material increase in the
compensation paid or payable to any officer, director, employee or agent of the Company, (g) no material loss, destruction or damage to any property of the Company, whether or not insured, (h) no material labour dispute involving the Company and no
material change in the personnel of the Company, or the terms and conditions of their employment, (i) no acquisition or disposition of any assets (or any contract or arrangement therefor), including any of the Intellectual Property Rights (as
defined in Section 2.13 hereof) other than in the ordinary course of the Company’s business, nor any other transaction by the Company otherwise than for fair value in the ordinary course of its business, (j) no change in accounting methods or
practices of the Company, (k) no loss, or any development that is expected to result in a loss, of any significant supplier, customer, distributor or account of the Company (other than the completion in the ordinary course of business of specific
projects for customers), (l) no amendment or termination of any contract or agreement to which the Company is a party or by which it is bound, and (m) no commitment (contingent or otherwise) to do any of the foregoing. 
  
 2.10 Litigation. Except as set forth on Schedule 2.10, to the knowledge of the
Company, there is no litigation, arbitration or governmental proceeding or investigation pending or threatened, by or against the Company, or affecting any of the properties or assets of the Company, or against any officer, key employee or
Stockholder of the Company in such person’s capacity as such, nor, to the knowledge of the Company, has there occurred any event nor does there exist any condition on the basis of which any litigation, proceeding or investigation might properly
be instituted with any chance of recovery where 
  

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 such recovery could have a Material Adverse Effect. Neither the Company nor any officer, key employee or Stockholder
thereof in such person’s capacity as such is, to the knowledge of the Company, subject to any order, writ, injunction, decree, ruling or decision of any court, commission, board or other government agency. 
  
 2.11 Tax Matters. 
  

	(a)	The Company has paid all federal, provincial, state, local, foreign (including, without limitation, any taxes due in any U.S. jurisdiction) or other taxes, including, without
limitation, and where applicable, gross or net income taxes, capital taxes, excise taxes, sales taxes, use taxes, goods and services, harmonized sales, gross receipts taxes, franchise taxes, net worth taxes, employment and payroll related taxes,
withholding taxes, stamp taxes, transfer and property taxes, value-added taxes, unemployment insurance, severance, health insurance and Canada and Quebec and other government pension plan premiums or contributions, or other tax of any kind
whatsoever, including any liability therefor as a transferee under Section 6901 of the Tax Code or any similar provision of applicable laws, as a result of Treasury Regulation §1.1502-6 of the U.S. Internal Revenue Service or any similar
provision of applicable laws or as a result of any tax sharing or similar agreement together with any interest, penalty, fine or addition thereto, whether disputed or not (collectively, “Taxes”), required to be paid by it through
the date hereof, whether or not assessed by the appropriate governmental authority, and has fully provided for any Taxes not yet due in the books and records and financial statements, as applicable, of the Company. 

  

	(b)	All Taxes and other assessments and levies that the Company is required to withhold or collect have been withheld and collected and have been paid over to the proper governmental
authorities when due. 

  

	(c)	The Company has, in accordance with applicable law, timely (taking into consideration all extensions) and properly filed all federal, provincial, state, local and foreign tax
returns (including, without limitation, any U.S. federal, state or local tax returns), declarations, reports, claims for refund, information returns or statements and any schedule or amendment thereto relating to Taxes or required to be filed by any
taxing authority in connection with the determination of any Tax (collectively, “Tax Returns”) required to be filed by it through the date hereof. All such Tax Returns were correct and complete in all material respects and included
all income and other amounts and information required to be reported thereon. 

  

	(d)	Neither the Canada Customs and Revenue Agency, the U.S. Internal Revenue Service nor any other taxing authority is now asserting or, to the knowledge of the Company, threatening to
assert against the Company any deficiency or claim for additional Taxes and there are no matters under discussion, audit or appeal with any relevant governmental authority. No issue relating to the Company or involving any Tax for which the Company
might be liable has been resolved in favour of any taxing authority in any audit or examination which, by application of the same principles could reasonably be expected to result in a deficiency for Taxes for any other period.

  

	(e)	The Company files Tax Returns in all jurisdictions where it is required to so file. No claim has ever been made in writing by an authority in a jurisdiction where the Company does
not file Tax Returns that it is or may be subject to taxation by that jurisdiction. 

  

	(f)	The Company has not waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to payment or collection of any Tax, filing of a Tax
Return, or with respect to any Tax assessment or deficiency and no power of attorney granted by or with respect to the Company relating to Taxes is currently in force. 

  

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	(g)	There are no liens or other security interests encumbering any of the assets of the Company that arose in connection with any failure (or alleged failure) to pay any Taxes (except
where such security interests arise as a matter of law prior to the due date for paying the related Taxes). 

  

	(h)	Except as set forth in Schedule 2.11(h) hereto, there has never been any audit of any Tax Return filed by the Company, no such audit is in progress to the knowledge of the Company,
and the Company has not been notified by any tax authority that any such audit is contemplated or pending. The Company has delivered to Adherex true, complete and correct copies of all income Tax Returns, audit reports and statements of deficiencies
filed or issued to or with respect to the Company (or, insofar as such items relate to the Company, by or to any affiliated, consolidated, combined or unitary group of which the Company was then a member) since its date of inception.

  

	(i)	The unpaid Taxes of the Company (i) did not, as of the Financial Statements, exceed the reserve for Tax liability (other than any reserve for deferred taxes established to reflect
timing differences between book and tax income) set forth on the face of the Financial Statements (other than in any notes thereto) and (ii) do not exceed that reserve as adjusted for the passage of time through the date hereof in accordance with US
GAAP and the past custom and practice of the Company in filing its Tax Returns. 

  

	(j)	The Company is not and has never been (i) a member of any affiliated group filing or required to file a consolidated, combined, or unitary Tax Return or (ii) a party to or bound by,
nor does it have or has it ever had any obligation under, any Tax sharing agreement or similar contract or arrangement. The Company does not have any liability for the Taxes of any other person under Treasury Regulation §1.1502-6 of the U.S.
Internal Revenue Service (or any similar provision of state, local, or foreign law), as a transferee or successor, by contract, or otherwise. 

  

	(k)	The Company has not distributed to its Stockholders or security holders stock or securities of a controlled corporation in a transaction to which Section 355 of the Tax Code applies
(x) in the two years prior to the date of this Agreement or (y) in a distribution which could otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section 355(e) of the Tax Code) that
includes the transactions contemplated by this Agreement. 

  

	(l)	The Company is not a party to any contract or agreement, plan, or arrangement concerning any person that, individually or collectively with other similar agreements, could
reasonably be expected to give rise to the payment of any amount that would not be deductible by the Company by reason of Section 280G of the Code. 

  

	(m)	The Company is not and has not been during the applicable period specified in Section 897(c)(1)(A)(ii) of the Tax Code, a United States real property holding corporation within the
meaning of Section 897(c)(2) of the Tax Code. 

  

	(n)	No Stockholder holds any Common Stock which is subject to a substantial risk of forfeiture (within the meaning of Section 83 of the Tax Code) with respect to which a valid election
under Section 83(b) of the Tax Code has not been made, and no payment to any Stockholder of any portion of the consideration payable pursuant to this Agreement to the holders of Common Stock will result in compensation or other income to such
Stockholder with respect to which Adherex or the Company would be required to deduct or withhold any Tax. 

  

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	(o)	The Company has not used the installment method to defer any material liability for Taxes to any taxable period ending after the Effective Time, and the Company is not required to
make any adjustments pursuant to Section 481 of the Tax Code or any similar provision of state or local law. There is no limitation on the utilization by the Company of its net operating losses, built-in losses, tax credits or other similar items
under Section 382, 383, or 384 of the Tax Code. 

  
 2.12 Title to
Properties. Schedule 2.12 hereto lists all real and personal property used in or necessary to the conduct of the business of the Company that had an original purchase price of at least $5,000 and that has been acquired since December 31, 2001.
The Company has good and marketable title of record to all of its owned real property and a valid and enforceable leasehold interest in all of its leased real property, free and clear of all liens, restrictions and encumbrances. Subject to any
encumbrances thereon disclosed in Schedule 2.13(a) hereto, the Company has good title to or a valid and enforceable leasehold interest in all personal property used in or necessary to its business, and the same is in good condition and repair in all
material respects (ordinary wear and tear excepted). The Company is not in violation of any zoning, building or safety ordinance, regulation or requirement or other law or regulation applicable to the operation of its owned or leased properties,
except for violations which, singly or in the aggregate, would not have a Material Adverse Effect nor has the Company received written notice of any violation with which it has not complied in all material respects. 
  
 2.13 Intellectual Property. 
  

	(a)	Ownership of Intellectual Property Assets. Except as set forth in Schedule 2.13(a), the Company is the exclusive owner of, and has good, valid and marketable title to each of
the Intellectual Property Assets (as defined in sub-section 2.13(m) hereof) free and clear of all mortgages, pledges, charges, liens, security interests, or other encumbrances or agreements, and has the right to use without payment to a third party
all of the Intellectual Property Assets. No claim is pending or, to the best knowledge of the Company, threatened against the Company and/or its officers, employees and consultants to the effect that the respective right, title and interest of the
Company in and to the Intellectual Property Assets is invalid or unenforceable by the Company. Except as set forth on Schedule 2.13(a) hereto, all former and current employees, consultants and contractors of the Company have executed written
instruments with the Company that assign to the Company all rights to any inventions, improvements, discoveries, or information relating to the business of the Company. To the knowledge of the Company, no employee of Company has entered into any
agreement that restricts or limits in any way the scope or type of work in which such employee may be engaged or requires such employee to transfer, assign, or disclose information concerning such employee’s work to anyone other than the
Company. To the knowledge of the Company, no employee or consultant of the Company has utilized or is utilizing any intellectual property belonging to any third party except for any licenses or other agreements listed pursuant to sub-section 2.13(g)
hereof. 

  

	(b)	Patents. Schedule 2.13(b) hereto sets forth a complete and accurate list and summary description of all Patents (as defined in sub-section 2.13(m) hereof. All of the issued
Patents are currently in compliance with formal legal requirements (including, without limitation, payment of filing, examination and maintenance fees and proofs of working or use), are not subject to any maintenance fees or taxes or actions falling
due within ninety (90) days after the Effective Time, except where such non-compliance would not have a Material Adverse Effect, and to the Company’s knowledge, such Patents are valid and enforceable. In each case where a Patent is

  

 10 

 held by the Company by assignment, such assignment has been duly recorded with the U.S. Patent and
Trademark Office and all other jurisdictions of registration. No Patent has been or is now involved in any interference, reissue, re-examination or opposition proceeding. To the knowledge of the Company, there is no potentially interfering patent or
patent application of any third party. All products made, used or sold under the Patents have not been improperly marked with a patent notice. 
  

	(c)	Trade-marks. Schedule 2.13(c) hereto sets forth a complete and accurate list and summary description of all Marks (as defined in sub-section 2.13(m) below). All Marks that
have been registered with the U.S. Patent and Trademark Office and/or any other jurisdiction are currently in compliance with formal legal requirements (including, without limitation, the timely post-registration filing of affidavits of use and
incontestability and renewal applications), are valid and enforceable, and are not subject to any maintenance fees or taxes or actions falling due within ninety (90) days after the Effective Time. In each case where a Mark is held by the Company by
assignment, the assignment has been duly recorded with the U.S. Patent and Trademark Office and all other jurisdictions of registration where required by law or otherwise necessary or appropriate. No Mark of the Company has been or is now involved
in any opposition, invalidation or cancellation proceeding and, to the knowledge of the Company, no such action is threatened with respect to any of the Marks belonging to the Company. All products and materials containing a Mark bear the proper
notice where required by law or otherwise necessary or appropriate. 

  

	(d)	Copyrights. Schedule 2.13(d) hereto sets forth a complete and accurate list and summary description of all Copyrights (as defined in sub-section 2.13(m) hereof). All
Copyrights that have been registered with the U.S. Copyright Office are identified on such Schedule and are currently in compliance with formal legal requirements, are valid and enforceable, and are not subject to any fees or taxes or actions
falling due within ninety (90) days after the date of the Effective Time. In each case where a Copyright is held by the Company by assignment, the assignment has been duly recorded with the U.S. Copyright Office and all other jurisdictions of
registration where required by law or otherwise necessary or appropriate. None of the source or object code, algorithms, or structure included in the Products (as defined below) is copied from, based upon, or derived from any other source or object
code, algorithm or structure in violation of the rights of any third party. Any substantial similarity of any of the Products to any computer program owned by any third party did not result from such Products being copied from, based upon, or
derived from any such computer software program in violation of the rights of any third party. All copies of works encompassed by the Copyrights have been marked with the proper copyright notice where required by law or otherwise necessary or
appropriate. 

  

	(e)	Trade Secrets. The Company has taken all reasonable security measures (including, without limitation, entering into appropriate confidentiality and non-disclosure agreements
with all officers, directors, employees, and consultants of the Company, and any other persons with access to the Trade Secrets (as defined in sub-section 2.13(m) hereof)) to protect the secrecy, confidentiality and value of such Trade Secrets. To
the knowledge of the Company, there has not been any breach by any party to any such confidentiality or non-disclosure agreement. The Trade Secrets have not been disclosed by the Company to any person or entity other than employees or contractors of
the Company who had a need to know and use the Trade Secrets in the course of their employment or contract performance. To the knowledge of the Company, the Company has the right to use, free and clear of claims of third parties, all Trade Secrets.
To the knowledge of the Company, no third party has asserted that the use by the Company of any Trade Secret violates the rights of any third party. 

  

 11 

	(f)	Exclusivity of Rights. Except as set forth on Schedule 2.13(f) hereto, to its knowledge, the Company has the exclusive right to use, license, distribute, transfer and bring
infringement actions with respect to each of the Intellectual Property Assets. Except as set forth on Schedule 2.13(f) hereto, the Company (i) has not licensed or granted to anyone rights of any nature to use any of the Intellectual Property Assets;
and (ii) to its knowledge, is not obligated to and does not pay royalties or other fees to anyone for its ownership, use, license or transfer of any of the Intellectual Property Assets. 

  

	(g)	Licenses Received. Except for computer software that is generally commercially available with a per sale copy cost of less than $2,500, all licenses or other agreements under
which the Company is granted rights by others in Intellectual Property Assets are listed in Schedule 2.13(g) hereto. All such licenses or other agreements are in full force and effect, to the knowledge of the Company there is no material default by
any party thereto, and, except as set forth on Schedule 2.13(g) hereto, all of the rights of the Company thereunder are freely assignable. True and complete copies of all such licenses or other agreements, and any amendments thereto, have been
provided to Adherex and Adherex US, and to the knowledge of the Company, the licensors under the licenses and other agreements under which the Company is granted rights have all requisite power and authority to grant the rights purported to be
conferred thereby. 

  

	(h)	Licenses Granted. All licenses or other agreements under which the Company has granted rights to others in Intellectual Property Assets are listed in Schedule 2.13(h) hereto.
Except as set forth thereon, all such licenses or other agreements are in full force and effect, and to the knowledge of the Company there is no material default by any party thereto. True and complete copies of all such licenses or other
agreements, and any amendments thereto, have been provided to Adherex and Adherex US. 

  

	(i)	Affirmative Obligations. The Company does not have any obligation to any third party to maintain, modify, improve or upgrade any of the Products. 

  

	(j)	Sufficiency. To the knowledge of the Company, the Intellectual Property Assets constitute all of the assets of the Company used in designing, creating and developing the
Products, and are all those necessary for the operation of the business of the Company as currently conducted and planned to be conducted, except where the failure to have any asset would not have a Material Adverse Effect. 

 

	(k)	Infringement. To the knowledge of the Company, none of the Products manufactured and sold, or contemplated to be manufactured and sold, nor any process or know-how used, by
the Company infringes any patent, trade-mark, service mark, trade name, copyright or other proprietary right of any person. 

  

	(l)	Non-Disclosure Contracts. Each of the Non-Disclosure Contracts is a valid and binding obligation of the Company, enforceable in accordance with its terms.

  

	(m)	For purposes of this Section 2.13, 

  

	 	(i)	“Intellectual Property Assets” means the intellectual property assets of the Company, necessary or appropriate for the its business as currently conducted or
proposed to be conducted, which assets consist of the following property: 

  

	 	(A)	the Products (as defined below); 

  

 12 

	 	(B)	all patents, patent applications (whether provisional or pending), patent rights, and inventions and discoveries and invention disclosures (whether or not patented) together with
any and all patents issuing thereon, including continuation, divisionals and re-issue applications and continuation-in-part applications and any United States or foreign patents granted upon such applications, based upon inventions or improvements
discovered by the Company (collectively, “Patents”); 

  

	 	(C)	the name “Oxiquant”, all trade names, trade dress, logos, packaging design, slogans, Internet domain names, registered and unregistered trade-marks and service marks and
applications for any of the foregoing (collectively, “Marks”); 

  

	 	(D)	all (I) copyright registrations and applications, (II) if the failure to possess such copyrights would cause a Material Adverse Effect, copyrights that are not registered or
applications in both published and unpublished works, including without limitation all compilations, databases and computer programs and (III) derivatives, translations, adaptations and combinations of the above (collectively,
“Copyrights”); 

  

	 	(E)	all know-how, trade secrets, confidential or proprietary information, research in progress, algorithms, data, designs, processes, formulae, drawings, schematics, blueprints, flow
charts, models, prototypes, techniques, Beta testing procedures and Beta testing results (collectively, “Trade Secrets”); and 

  

	 	(F)	all goodwill, franchises, licenses, permits, consents, approvals, technical information, telephone numbers, and claims of infringement against third parties (collectively, the
“Rights”). 

  

	 	(ii)	“Products” means the items listed on Schedule 2.13(m)(ii) hereto, which consists of products that are sold, marketed, and distributed by the Company.

  

	 	(iii)	“Non-Disclosure Contracts” means all non-disclosure and/or confidentiality agreements entered into between the Company on the one hand and persons in connection
with disclosures by the Company on the other hand relating to the Products and the Intellectual Property Assets. 

  
 2.14 Certain Contracts and Arrangements. Except as set forth in the Transaction Documents or in Schedules 2.13 or 2.14 hereto, the Company is not a party or
subject to or bound by: 
  

	(a)	any contract or agreement (i) involving a potential commitment or payment by the Company in excess of $75,000 or (ii) which is otherwise material and not entered into in the
ordinary course of business; 

  

	(b)	any contract, lease or agreement which is not cancelable by the Company without penalty on less than ninety (90) days’ notice; 

  

	(c)	any contract containing covenants directly or explicitly limiting in any material respect the freedom of the Company to compete in any line of business or with any person or entity;

  

 13 

	(d)	any contract or agreement relating to the licensing, distribution, development, purchase, sale or servicing of its products except in the ordinary course of business consistent with
past practices; 

  

	(e)	any indenture, mortgage, promissory note, loan agreement, guaranty or other agreement or commitment for borrowing or any pledge or security arrangement; 

  

	(f)	any employment contracts, non-competition agreements or other agreements with present or former officers, directors, employees or Stockholders of the Company, or persons related to
or affiliated with such persons; 

  

	(g)	any share redemption or purchase agreements or other agreements affecting or relating to any shares of capital stock of the Company, including, without limitation, any agreement
with any stockholder of the Company which includes anti-dilution rights, registration rights, voting arrangements, operating covenants or similar provisions; 

  

	(h)	any pension, profit sharing, bonus, retirement, severance or stock option plans; 

  

	(i)	any royalty, dividend or similar arrangement based on the revenues or profits of the Company or any contract or agreement involving fixed price or fixed volume arrangements;

  

	(j)	any joint venture, partnership, manufacturer, development or supply agreement; 

  

	(k)	any acquisition, merger or similar agreement; 

  

	(l)	any contract with any governmental entity; or 

  

	(m)	any other material contract not executed in the ordinary course of business. 

  

All contracts, agreements, leases and instruments set forth on Schedule 2.14 hereto are valid and are in full force and effect and constitute legal,
valid and binding obligations of the Company and, to the knowledge of the Company, of the other parties thereto, and are enforceable in accordance with their respective terms. The Company does not have any knowledge of any notice or threat to
terminate any such contracts, agreements, leases or instruments. Neither the Company nor, to the knowledge of the Company, any other party, is in default in complying with any provisions of any such contract, agreement, lease or instrument, and no
condition or event or fact exists which, with notice, lapse of time or both, would constitute a default thereunder on the part of the Company, except for any such default, condition, event or fact that, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect. 
  
 2.15 Governmental
Approvals; Compliance with Laws. The Company is in compliance in all respects with all applicable laws and regulations, except where the failure to be in compliance would not have a Material Adverse Effect. Except as set forth on Schedule 2.15
hereto, the Company has all of the permits, licenses, orders, franchises and other rights and privileges of all federal, state or local or other foreign governmental or regulatory bodies necessary for the Company to conduct its business as presently
conducted and as contemplated to be conducted, except for those the absence of which would cause a Material Adverse Effect. All such permits, licenses, orders, franchises and other rights and privileges are in full force and effect and, to the
knowledge of the Company, no suspension or cancellation of any of them is threatened, and none of such permits, licenses, orders, franchises or other rights and privileges will be affected by the consummation of the transactions contemplated by the
Transaction Documents. 
  

 14 

 2.16 Insurance Coverage. Schedule 2.16 hereto contains an accurate summary of the insurance policies currently
maintained by the Company. There are currently no claims pending against the Company under any insurance policies currently in effect and covering the property, business or employees of the Company, and all premiums due and payable with respect to
the policies maintained by the Company have been paid to date. To the knowledge of the Company, there is no threatened termination of any such policies or arrangements. 
  
 2.17 Employee Matters. 
  

	(a)	Schedule 2.17 hereto lists and describes all the employee benefit, fringe benefit, supplemental unemployment benefit, bonus, incentive, profit sharing, termination, change of
control, pension, retirement, stock option, stock purchase, stock appreciation, health, welfare, medical, dental, disability, life insurance and similar plans, programmes, arrangements or practices relating to the current or former employees,
officers or directors of the Company, respectively, maintained, sponsored or funded by the Company, whether written or oral, funded or unfunded, insured or self-insured, registered or unregistered (collectively, the “Company Employee
Plans”). 

  

	(b)	All of the Company Employee Plans are and have been established, registered, qualified, invested and administered, in all respects, in accordance with their terms and all applicable
laws, including all tax laws where same is required for preferential tax treatment. No fact or circumstance exists that could adversely affect the preferential tax treatment ordinarily accorded to any such Company Employee Plan.

  

	(c)	All obligations regarding the Company Employee Plans have been satisfied, there are no outstanding defaults or violations by any party to any Company Employee Plan and no taxes,
penalties, or fees are owing or eligible under or in respect of any of the Company Employee Plans. 

  

	(d)	The Company may unilaterally amend or terminate, in whole or in part, each Company Employee Plan subject only to written employment agreements as disclosed in Schedule 2.17 hereto
and approvals required by applicable laws. 

  

	(e)	No Company Employee Plan is subject to any examination or other proceeding, action or claim, or, to the knowledge of the Company after due investigation, pending investigation, in
any case, initiated by any regulatory authority or by any other party (other than routine claims for benefits), and there exists no state of facts which could reasonably be expected to give rise to any such investigation, examination or other
proceeding, action or claim or to affect the registration of any Company Employee Plan required to be registered. 

  

	(f)	All contributions or premiums required to be paid by the Company under the terms of each Company Employee Plan or by applicable laws have been made in a timely fashion in accordance
with applicable laws and the terms of the Company Employee Plans. The Company does not have any liability with respect to any of the Company Employee Plans, other than liability that accrues in the ordinary course of business under such plans after
the date hereof. 

  

	(g)	There have been no improper withdrawals, applications or transfers of assets of any Company Employee Plan and neither the Company nor any of its agents or delegates, has breached
any fiduciary obligation with respect to the administration or investment of any Company Employee Plan. 

  

 15 

	(h)	Each Company Employee Plan which is a funded plan is fully funded as of the date hereof on both a going concern and a solvency basis pursuant to the actuarial assumptions and
methodology utilized in the most recent actuarial valuation therefor. 

  

	(i)	None of the Company Employee Plans enjoy any special tax status under any applicable laws, nor have any advance tax rulings been sought or received in respect of any Company
Employee Plan. 

  

	(j)	No insurance policy or any other agreement affecting any Company Employee Plan requires or permits a retroactive increase in contributions, premiums or other payments due
thereunder. The level of insurance reserves under each insured Company Employee Plan is reasonable and sufficient to provide for all incurred but unreported claims. 

  

	(k)	None of the Company Employee Plans (other than pension plans) provide benefits to retired employees or to the beneficiaries or dependants of retired employees.

  

	(l)	Except as set forth on Schedule 2.17(l) hereto, no Company Employee Plan is subject to the U.S. Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), or any regulation promulgated thereunder. 

  
 2.18 Employees. 
  

	(a)	Except as otherwise set forth in Schedule 2.18(a) hereto: 

  

	 	(i)	The Company is not and has not engaged in any unfair labour practice and no unfair labour practice complaint, grievance or arbitration proceeding is pending or, to the best of the
knowledge of the Company, threatened against the Company; and 

  

	 	(ii)	No collective bargaining agreement is currently being negotiated by the Company with respect to any employees of the Company and there are no collective agreements in force with
respect to any of its employees. No union representation question exists respecting the employees of the Company. There is no labour strike, dispute, work slowdown or work stoppage pending or involving or, to the best of the knowledge of the
Company, threatened against the Company. No trade union has applied to have the Company declared a related employer pursuant to any labour relations legislation in any jurisdiction in which the Company carries on business. 

 

	(b)	Schedule 2.18(b) hereto contains a correct and complete list of each employee, director, independent contractor, consultant and agent of the Company, whether actively at work or
not, their respective salaries, wage rates, commissions and consulting fees, bonus arrangements, benefits, positions, ages, status as full-time or part-time employees and length of service. Except for the written employment agreements set forth in
Schedule 2.18(b) hereto, no employee of the Company has any agreement as to length of notice or severance payment required to terminate his or her employment, other than such as results by applicable law from the employment of an employee without an
agreement as to notice or severance. 

  

 16 

	(c)	All amounts due or accrued due for all salary, wages, bonuses, commissions, vacation with pay, pension benefits or other employee benefits are reflected in the books and records of
the Company. 

  
 2.19 No Brokers or Finders. Except as set
forth on Schedule 2.19 hereto, no person has or will have, as a result of the transactions contemplated by this Agreement, any right, interest or claim against or upon the Company for any commission, fee or other compensation as a finder or broker
because of any act or omission by the Company or any of its Stockholders or affiliates. 
  
 2.20 Transactions with Affiliates. Except as set forth in Schedule 2.20 hereto, there are no loans, leases or other continuing arrangements between the Company or any subsidiary of the Company on the one hand, and any officer,
director, affiliate or Stockholder of the Company or any such subsidiary, respectively, or any respective family member or affiliate of such officer, director or Stockholder on the other hand. 
  
 2.21 Environmental Matters. No Hazardous Materials have been generated, transported,
used, disposed, stored or treated by the Company, except in material compliance with applicable Environmental Laws. No Hazardous Materials have been released, discharged, disposed, or otherwise caused to enter the soil or water in, under or upon any
real property owned, leased or operated by the Company, except in material compliance with applicable Environmental Laws. 
  
 2.22 Corporate Records. The corporate record books of the Company accurately record, in all material respects, all corporate action taken by its Stockholders, the
Company Board and all committees thereof. The copies of the corporate records of the Company, as made available to Adherex and Adherex US for review, are true and complete copies of the originals of such documents. 
  
 2.23 Customers, Distributors and Partners. Schedule 2.23 hereto sets forth the name of
each customer and distributor of the Company who accounted for more than five percent (5%) of the revenues of the Company for the year ended December 31, 2001 (respectively, the “Company Customers” and “Company
Distributors”) together with the names of any persons or entities with which the Company has a material strategic partnership or similar relationship (“Company Partners”). No Company Customer, Company Distributor or Company
Partner has cancelled or otherwise terminated its relationship with the Company or has decreased materially its usage or purchases of the services or products of the Company. No Company Customer, Company Distributor or Company Partner has, to the
knowledge of the Company, any plan or intention to terminate, to cancel or otherwise materially and adversely modify its relationship with the Company or to decrease materially or limit its usage, purchase or distribution of the services or products
of the Company. 
  
 2.24 Tax Free Status of Merger. To the knowledge of the
Company, neither the Company nor any of its affiliates has taken or agreed to take any action, failed to take any action or is aware of any fact or circumstance that would prevent the Merger from constituting a tax-free reorganization within the
meaning of Section 368(a) of the Tax Code or that would cause any of the Stockholders to recognize gain for U.S. income tax purposes upon the exchange of their Common Stock or Preferred Stock for Merger Securities pursuant to the Merger. 

 
 2.25 No General Solicitation or General Advertising. None of the Company, its
affiliates or any person acting on its or their behalf has engaged in any general solicitation or general advertising (as each such term is used in Regulation D under the U.S. Act) with respect to the Merger Securities, including, without
limitation, advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or broadcast over radio or television, or any seminar or meeting whose attendees have been invited by general solicitation or
general advertising. 
  

 17 

 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES OF ADHEREX AND ADHEREX US 
  
 In order to induce the Company to enter into this Agreement and consummate the transactions contemplated hereby, Adherex and Adherex US hereby represent
and warrant to the Company as follows: 
  
 3.1 Incorporation and
Organization. Adherex is a corporation duly incorporated, organized, validly existing and in good standing under the CBCA and Adherex US is a corporation duly incorporated, organized, validly existing and in good standing under Delaware Law.
Each of Adherex and Adherex US has all requisite corporate power and authority to own or lease and operate its respective properties, to carry on its respective businesses as presently conducted, to enter into and perform the Transaction Documents
and to carry out the transactions contemplated hereby and thereby. Each of Adherex and Adherex US is duly licensed or qualified to do business as a foreign corporation in each jurisdiction wherein the character of its property or the nature of the
activities presently conducted by it, makes such qualification necessary, except where the failure to be so licensed or qualified would not have, or be reasonably likely to have, a Material Adverse Effect. Adherex is not in violation of any term or
provision of its articles of incorporation or its by-laws, each as amended (the “Adherex Constating Documents”) and Adherex is not in violation of any term or provision of its certificate of incorporation (the “Adherex US
Certificate of Incorporation”) or by-laws (the “Adherex US By-Laws”) as in effect as of this date. Adherex US is not subject to any reporting requirements of the Exchange Act. 
  
 3.2 Authorization and Non-Contravention. This Agreement is a valid and binding
obligation of each of Adherex and Adherex US, enforceable against each of them in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar laws, from time to time
in effect, which affect enforcement of creditors’ rights generally. Each of Adherex and Adherex US has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate or other action of the Adherex and Adherex US and no other corporate proceedings
on the part of either are necessary to approve this Agreement and to consummate any of the transactions contemplated hereby, other than the adoption of this Agreement by the Shareholders in accordance with the CBCA and the rules and regulations of
the TSX and the adoption of this Agreement by the sole stockholder of Adherex US in accordance with Delaware Law. The Adherex Board has, as of the date hereof, determined that the Merger is fair to and in the best interest of Adherex and the
Shareholders. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not: (a) violate, conflict with or result in a default under any contract or obligation to which Adherex or
Adherex US is a party or by which it or its assets are bound, or any provision of the Adherex Constating Documents, the Adherex US Certificate of Incorporation or the Adherex US By-Laws, or cause the creation of any lien or encumbrance upon any of
the assets of Adherex or Adherex US, except for those which would not have, or be reasonably likely to have, a Material Adverse Effect; (b) violate or result in a violation of, or constitute a default (whether after the giving of notice, lapse of
time or both) under, any provision of any law, regulation or rule, or, to the knowledge of Adherex, any order of, or any restriction imposed by any court or other governmental agency applicable to either of Adherex or Adherex US, except for those
which would not have, or be reasonably likely to have, a Material Adverse Effect; (c) require from Adherex or Adherex US any notice to, declaration or filing with, or consent or approval of any governmental authority or other third party other than
pursuant to applicable securities laws (including, without limitation, U.S. “blue sky” laws); or 
  

 18 

 
(d) accelerate any obligation under, or give rise to a right of termination of, any agreement, permit, license or authorization to which Adherex or Adherex
US is a party or by which either is bound, except for those which would not have, or reasonably likely to have, an Material Adverse Effect. 
  
 3.3 Authorized and Issued Capital of Adherex. The authorized capital of Adherex consists of an unlimited number of common shares (the “Common
Shares”) of which on the date hereof, 40,163,985 Common Shares are validly issued and outstanding as fully paid and non-assessable shares. All of the issued and outstanding Common Shares are free of any liens or encumbrances created by or
resulting from the actions of Adherex, and are not subject to pre-emptive rights or rights of first refusal created by statute, the Constating Documents or any agreement to which Adherex is a party or by which it is bound. All Common Shares
outstanding on the date hereof have been offered, issued, sold and delivered by Adherex in compliance with all registration or qualification and prospectus requirements (or applicable exemptions therefrom) of all applicable Canadian Securities Laws
(as defined below) and other applicable securities laws. Except as set forth in this Section 3.3 or reflected in Schedule 3.3 hereto, Adherex does not have and is not bound by any outstanding subscriptions, options, warrants, convertible securities,
calls, commitments, agreements or obligations of any character calling for the purchase, redemption or issuance of any Common Shares or any other equity security of Adherex or any securities representing the right to purchase or otherwise receive
any Common Shares or any other equity security of Adherex. The Common Shares are listed and posted for trading on The Toronto Stock Exchange (the “TSX”). 
  
 3.4 Reporting Issuer Status. Adherex is a reporting issuer in good standing under the securities laws of the Provinces of British
Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Prince Edward Island, Nova Scotia and Newfoundland, the rules, their respective regulations, prescribed forms, orders and rulings made thereunder and the policy statements
issued by the securities commissions or other applicable securities regulatory authorities thereunder including, without limitation, the Ontario Act (collectively, the “Canadian Securities Laws”) and is in compliance with the
by-laws, rules and regulations of the TSX. Adherex has timely filed all forms, reports and documents required to be filed by Adherex under the Canadian Securities Laws and the rules and regulations of the TSX since Adherex became a reporting issuer
under the Canadian Securities Laws or commenced listing on the TSX, as applicable. All such required forms, reports and documents are referred to herein as the “Securities Reports.” As of their respective dates, the Securities
Reports (i) were prepared in accordance with the requirements of applicable Canadian Securities Laws and the rules and regulations of the TSX applicable thereto and (ii) did not at the time they were filed contain any misrepresentation of a material
fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Adherex is a “qualifying issuer” as
that term is defined in Multilateral Instrument 45-102 – Resale of Securities of the Canadian Securities Administrators (“MI 45-102”). Adherex has made available to the Company a true and correct copy of each Securities Report
filed by or for Adherex. If at any time prior to the Effective Time any event relating to Adherex should be disclosed by Adherex which should be set forth in an amendment or supplement to any Securities Report, Adherex shall promptly inform the
Company thereof. 
  
 3.5 Authorized and Issued Capital of Adherex US. The
authorized capital of Adherex US consists of 3,000 shares of Subsidiary Common Stock of which 1,000 shares of Subsidiary Common Stock are issued and outstanding, all of which shares are held beneficially and of record by Adherex. Adherex US does not
have and is not bound by any outstanding subscriptions, options, warrants, convertible securities, calls, commitments, agreements or obligations or any character calling for the purchase, redemption or issuance of any shares or capital stock or
other equity security of Adherex US or any securities representing the right to purchase or otherwise receive any shares of the capital stock or any 
  

 19 

 other equity security of Adherex US. All outstanding shares of the capital stock of Adherex US were issued in compliance
with applicable Canadian Securities Laws and applicable U.S. securities laws. None of the shares of Subsidiary Common Stock are listed on any stock exchange. 
  
 3.6 Other Adherex Securities. Schedule 3.6 hereto sets forth all subscriptions, options, warrants, convertible securities, calls, commitments, agreements or
obligations or any character or rights or obligations capable of becoming any of the foregoing, calling for the purchase, redemption or issuance of any shares in the capital of Adherex and any other securities of Adherex or otherwise exercisable or
exchangeable into shares in the capital of Adherex (collectively, “Adherex Rights”), the number and class or series of shares in the capital of Adherex for which such Adherex Rights are so exercisable or exchangeable, along with the
applicable vesting schedule, if any, and the exercise price thereof. All of the issued and outstanding Adherex Rights have been offered, issued and sold in compliance with applicable securities laws. Except as disclosed in Schedule 3.6 hereto, there
are no outstanding subscriptions, options, warrants, agreements, arrangements or commitments of any kind for or relating to the issuance, or sale of, or outstanding securities convertible into or exchangeable for, any shares in the capital of or
other equity interests in Adherex. 
  
 3.7 Other Agreements Relating to Common
Shares. Except as set forth in Schedules 3.6 or 3.7 hereto: (i) Adherex does not have any obligation to purchase, redeem, or otherwise acquire any shares of its capital stock or any interests therein or to pay any dividend or to make any
distribution in respect thereof; (ii) there are no pre-emptive rights, rights of first refusal, put or call rights or obligations or anti-dilution rights with respect to the issuance, sale or redemption of any shares of capital stock of Adherex.
There are no rights to have shares of capital stock of Adherex or Adherex US registered for sale to the public pursuant to the laws of any jurisdiction, and there are no agreements of which Adherex is aware, relating to the voting of Adherex’s
voting securities or restrictions on the transfer of shares of capital stock of Adherex. 
  
 3.8 Validity of Merger Securities. The Merger Shares to be issued to the Stockholders in the Merger, when issued in accordance with the provisions of this Agreement, and the Warrant Shares when issued pursuant
to the terms of the Merger Warrants, will be validly issued, fully paid and non-assessable, and not subject to any encumbrances or pre-emptive rights except for applicable restrictions on transfer imposed by applicable securities laws, including
those imposed by the U.S. Act including, without limitation, by Rule 144 promulgated under the United States Securities Act of 1933, as amended (the “U.S. Act”), under applicable “blue sky” state securities laws and/or
Canadian Securities Laws, and will be issued in compliance with Canadian Securities Laws, and applicable United States and applicable state securities laws. The distribution of the securities of the corporation created, or to be created, by Adherex
prior to the Effective Time in connection with the Spin-Out, as contemplated by Section 6.3(a), shall be exempt from the prospectus and registered dealer requirements of all applicable Canadian Securities Laws and the applicable securities laws of
any territory of Canada. 
  
 3.9 Subsidiaries. Except as disclosed on
Schedule 3.9 and other than Adherex US, Adherex does not own or control, directly or indirectly, any interest in any other corporation, partnership, limited liability company, association, joint venture or other business entity. 
  
 3.10 Adherex Financial Statements. The audited balance sheets of Adherex at each of
the fiscal years ended June 30, 2001 and 2002, and the related statements of loss, shareholders’ equity and cash flows for each of the three years ending June 30, 2000, 2001 and 2002 (collectively, the “Adherex Financial
Statements”) present fairly the financial condition and results of operations of Adherex as at such dates and for the respective periods indicated therein and have been prepared in accordance with Canadian generally accepted accounting
principles (“Canadian GAAP”), applied consistently during the periods covered thereby, except as otherwise stated in the notes to such financial statements. The Adherex Financial Statements comply with all applicable requirements of
Canadian Securities Laws. 
  

 20 

 3.11 Absence of Undisclosed Liabilities. Except as stated or adequately reserved against in the Adherex Financial
Statements, incurred as a result of or arising out of the transactions contemplated under the Transaction Documents or as set forth on Schedule 3.11 hereto, Adherex does not have any liability or obligation of any nature, whether accrued, absolute,
contingent or otherwise, asserted or unasserted, known or unknown, in any case which has, or is reasonably likely to have, a Material Adverse Effect. Neither Adherex nor Adherex US has assumed, guaranteed, endorsed or otherwise become directly or
contingently liable on or for any indebtedness of any other person. 
  
 3.12
Absence of Certain Developments. Since June 30, 2002, except as set forth on Schedule 3.12, Adherex has conducted its business only in the ordinary course consistent with past practice and, except for general industry and economic conditions,
there has been (a) no change in the respective condition (financial or otherwise) of Adherex, or in the assets, liabilities, business or prospects of Adherex that has or is reasonably likely to have an Material Adverse Effect, (b) no declaration,
setting aside or payment of any dividend or other distribution with respect to, or any direct or indirect redemption or acquisition of, any of the shares in the capital of Adherex, (c) no issuance of any shares in the capital of Adherex or any
direct or indirect redemption, purchase or other acquisition of any of the capital or other equity securities of Adherex, (d) no waiver of any valuable right of Adherex or cancellation of any material debt or claim held by Adherex, (e) no discharge
or satisfaction by Adherex of any material lien or encumbrance or payment by Adherex of any obligation or liability (fixed or contingent), (f) no material increase in the compensation paid or payable to any officer, director, employee or agent of
Adherex that exceeds $50,000 in the aggregate, (g) no material loss, destruction or damage to any property of Adherex, whether or not insured, (h) no material labour dispute involving Adherex and no material change in the personnel of Adherex, or
the terms and conditions of their employment, (i) no acquisition or disposition of any assets (or any contract or arrangement therefor), including any Adherex Intellectual Property Rights, other than in the ordinary course of Adherex’s
business, nor any other transaction by Adherex otherwise than for fair value in the ordinary course of its business, (j) no change in accounting methods or practices of Adherex, (k) no loss, or any development that is expected to result in a loss,
of any significant supplier, customer, distributor or account of Adherex (other than the completion in the ordinary course of business of specific projects for customers), (l) no amendment or termination of any contract or agreement to which Adherex
is a party or by which it is bound, and (m) no commitment (contingent or otherwise) to do any of the foregoing. 
  
 3.13 Litigation. Except as set forth on Schedule 3.13, to the knowledge of Adherex, there is no litigation, arbitration or governmental proceeding or investigation
pending or threatened, by or against Adherex, or affecting any of the properties or assets of Adherex, or against any officer, key employee or Shareholder of Adherex in such person’s capacity as such, nor, to the knowledge of Adherex, has there
occurred any event nor does there exist any condition on the basis of which any litigation, proceeding or investigation might properly be instituted with any chance of recovery where such recovery could have a Material Adverse Effect. Neither
Adherex nor any officer, key employee or Shareholder thereof in such person’s capacity as such is, to the knowledge of Adherex, subject to any order, writ, injunction, decree, ruling or decision of any court, commission, board or other
government agency. 
  
 3.14 Adherex Tax Matters. 
  

	(a)	Each of Adherex and Adherex US has paid all Taxes, including all installments on account of Taxes for the current year that are due and payable whether or not assessed by the
appropriate governmental authority, required to be paid by it through the date hereof and has fully provided for any such Taxes not yet due in the books and records and financial statements, as applicable, of Adherex or Adherex US, respectively.

  

 21 

	(b)	All Taxes and other assessments and levies that each of Adherex and Adherex US is required to withhold or collect have been withheld and collected and have been paid over to the
proper governmental authorities when due. 

  

	(c)	Each of Adherex and Adherex US has, in accordance with applicable law, timely (taking into consideration all extensions) and properly filed all Tax Returns required to be filed by
it through the date hereof. All such Tax Returns were correct and complete in all material respects and included all income and other amounts and information required to be reported thereon. 

  

	(d)	Neither the Canada Customs and Revenue Agency, the U.S. Internal Revenue Service nor any other taxing authority is now asserting or, to the knowledge of Adherex, threatening to
assert against Adherex or Adherex US any deficiency or claim for additional Taxes, and there are no matters under assessment, audit or appeal with any relevant taxing authority. No issue relating to Adherex or Adherex US or involving any Tax for
which either might be liable has been resolved in favour of any taxing authority in any audit or examination which, by application of the same principles could reasonably be expected to result in a deficiency for Taxes of Adherex or Adherex US for
any other period. 

  

	(e)	Each of Adherex and Adherex US files Tax Returns in all jurisdictions where each is required to so file. No claim has ever been made in writing by an authority in a jurisdiction
where Adherex or Adherex US does not file Tax Returns that Adherex or Adherex US (as applicable) is or may be subject to taxation by that jurisdiction. 

  

	(f)	Neither Adherex nor Adherex US has waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to payment or collection of any Tax, filing
of a Tax Return, election, designation or similar filings relating to Taxes or with respect to any Tax assessment or deficiency and no power of attorney granted by or with respect to either of Adherex or Adherex US relating to Taxes is currently in
force. 

  

	(g)	There are no liens or other security interests encumbering any of the respective assets of Adherex and Adherex US that arose in connection with any failure (or alleged failure) to
pay any Taxes (except where such security interests arise as a matter of law prior to the due date for paying the related Taxes). 

  

	(h)	Except as set forth in Schedule 3.14(h) hereto, there has never been any audit of any Tax Return filed by or on behalf of Adherex or Adherex US, no such audit is in progress to the
knowledge of Adherex and Adherex US, and neither Adherex nor Adherex US has been notified by any tax authority that any such audit is contemplated or pending. Each of Adherex and Adherex US has delivered true, complete and correct copies of all
income Tax Returns, audit reports and statements of deficiencies filed or issued to or with respect to Adherex or Adherex US (or, insofar as such items relate to Adherex or Adherex US, by or to any affiliated, consolidated, combined or unitary group
of which Adherex or Adherex US was then a member) since their respective dates of inception. 

  

	(i)	The unpaid Taxes of Adherex and Adherex US (i) did not, as of June 30, 2002, exceed the reserve for tax liability (other than any reserve for deferred taxes established to reflect
timing differences between book and tax income) set forth on the face of the Adherex Financial 

  

 22 

 Statements (other than in any notes thereto) and (ii) do not exceed that reserve as adjusted for the
passage of time through the date hereof in accordance with Canadian GAAP and the past custom and practice of Adherex in filing its Tax Returns. 
  

	(j)	As at the date of this Agreement, neither Adherex nor Adherex US has filed any Tax Return in the United States (including in any State or territory thereof).

  

	(k)	All Canadian federal and provincial income and capital tax liabilities of Adherex have been assessed by a relevant taxing authority and notices of assessment have been issued by all
relevant taxing authorities for all taxation years prior to and including the taxation year ended June 30, 2001. 

  

	(l)	Adherex has no unsatisfied liabilities for Taxes (including all related expenses) with respect to any notice of assessment or reassessment or similar document received by Adherex
relating to any Taxes. 

  
 3.15 Title to Properties. Schedule
3.15 hereto lists all real and personal property used in or necessary to the conduct of the business of Adherex that had an original purchase price of at least $5,000 and that has been acquired since June 30, 2002. Adherex has good and marketable
title of record to all of its owned real property and a valid and enforceable leasehold interest in all of its leased real property, free and clear of all liens, restrictions and encumbrances. Subject to any encumbrances thereon disclosed in
Schedule 3.15 hereto, Adherex has good title to or a valid and enforceable leasehold interest in all personal property used in or necessary to its business, and the same is in good condition and repair in all material respects (ordinary wear and
tear excepted). Adherex is not in violation of any zoning, building or safety ordinance, regulation or requirement or other law or regulation applicable to the operation of its owned or leased properties, except for violations which, singly or in
the aggregate, would not have a Material Adverse Effect nor has Adherex received written notice of any violation with which it has not complied in all material respects. Adherex US does not own, leases or have any other rights or interests in any
real or personal property. 
  
 3.16 Intellectual Property. 
  

	(a)	Ownership of Intellectual Property Assets. Except as set forth in Schedule 3.16(a), Adherex is the exclusive owner of, and has good, valid and marketable title to each of the
Intellectual Property Assets (as defined in sub-section 3.16(m) hereof) free and clear of all mortgages, pledges, charges, liens, security interests, or other encumbrances or agreements, and has the right to use without payment to a third party all
of the Intellectual Property Assets. No claim is pending or, to the best knowledge of Adherex, threatened against Adherex and/or its officers, employees and consultants to the effect that the respective right, title and interest of Adherex in and to
the Intellectual Property Assets is invalid or unenforceable by Adherex. Except as set forth on Schedule 3.16(a) hereto, all former and current employees, consultants and contractors of Adherex have executed written instruments with Adherex that
assign to Adherex all rights to any inventions, improvements, discoveries, or information relating to the business of Adherex. To the knowledge of Adherex, no employee of Adherex has entered into any agreement that restricts or limits in any way the
scope or type of work in which such employee may be engaged or requires such employee to transfer, assign, or disclose information concerning such employee’s work to anyone other than Adherex. To the knowledge of Adherex, no employee or
consultant of Adherex has utilized or is utilizing any intellectual property belonging to any third party except for any licenses or other agreements listed pursuant to sub-section 3.16(g) hereof. 

  

 23 

	(b)	Patents. Schedule 3.16(b) hereto sets forth a complete and accurate list and summary description of all Patents (as defined in sub-section 3.16(m) hereof). All of the issued
Patents are currently in compliance with formal legal requirements (including, without limitation, payment of filing, examination and maintenance fees and proofs of working or use), are not subject to any maintenance fees or taxes or actions falling
due within ninety (90) days after the Effective Time, except where such non-compliance would not have a Material Adverse Effect, and to the knowledge of Adherex, such Patents are valid and enforceable. In each case where a Patent is held by Adherex
by assignment, such assignment has been duly recorded with the U.S. Patent and Trademark Office and all other jurisdictions of registration. No Patent has been or is now involved in any interference, reissue, re-examination or opposition proceeding.
To the knowledge of Adherex, there is no potentially interfering patent or patent application of any third party. All products made, used or sold under the Patents have not been improperly marked with a patent notice. 

  

	(c)	Trade-marks. Schedule 3.16(c) hereto sets forth a complete and accurate list and summary description of all Marks (as defined in sub-section 3.16(m) below). All Marks that
have been registered with the U.S. Patent and Trademark Office and/or any other jurisdiction are currently in compliance with formal legal requirements (including, without limitation, the timely post-registration filing of affidavits of use and
incontestability and renewal applications), are valid and enforceable, and are not subject to any maintenance fees or taxes or actions falling due within ninety (90) days after the Effective Time. In each case where a Mark is held by Adherex by
assignment, the assignment has been duly recorded with the U.S. Patent and Trademark Office and all other jurisdictions of registration where required by law or otherwise necessary or appropriate. No Mark of Adherex has been or is now involved in
any opposition, invalidation or cancellation proceeding and, to the knowledge of Adherex, no such action is threatened with respect to any of the Marks belonging to Adherex. All products and materials containing a Mark bear the proper notice where
required by law or otherwise necessary or appropriate. 

  

	(d)	Copyrights. Schedule 3.16(d) hereto sets forth a complete and accurate list and summary description of all Copyrights (as defined in sub-section 3.16(m) hereof). All
Copyrights that have been registered with the U.S. Copyright Office are identified on such Schedule and are currently in compliance with formal legal requirements, are valid and enforceable, and are not subject to any fees or taxes or actions
falling due within ninety (90) days after the date of the Effective Time. In each case where a Copyright is held by Adherex by assignment, the assignment has been duly recorded with the U.S. Copyright Office and all other jurisdictions of
registration where required by law or otherwise necessary or appropriate. None of the source or object code, algorithms, or structure included in the Products (as defined below in this Section 3.16) is copied from, based upon, or derived from any
other source or object code, algorithm or structure in violation of the rights of any third party. Any substantial similarity of any of the Products to any computer program owned by any third party did not result from such Products being copied
from, based upon, or derived from any such computer software program in violation of the rights of any third party. All copies of works encompassed by the Copyrights have been marked with the proper copyright notice where required by law or
otherwise necessary or appropriate. 

  

	(e)	Trade Secrets. Adherex has taken all reasonable security measures (including, without limitation, entering into appropriate confidentiality and non-disclosure agreements with
all officers, directors, employees, and consultants of Adherex, and any other persons with access to the Trade Secrets (as defined in sub-section 3.16(m) hereof)) to protect the secrecy, confidentiality and value of such Trade Secrets. To the
knowledge of Adherex, there has not 

  

 24 

 been any breach by any party to any such confidentiality or non-disclosure agreement. The Trade Secrets
have not been disclosed by Adherex to any person or entity other than employees or contractors of Adherex who had a need to know and use the Trade Secrets in the course of their employment or contract performance. To the knowledge of Adherex,
Adherex has the right to use, free and clear of claims of third parties, all Trade Secrets. To the knowledge of Adherex, no third party has asserted that the use by Adherex of any Trade Secret violates the rights of any third party. 
  

	(f)	Exclusivity of Rights. Except as set forth on Schedule 3.16(f) hereto, to Adherex’s knowledge, Adherex has the exclusive right to use, license, distribute, transfer and
bring infringement actions with respect to each of the Intellectual Property Assets. Except as set forth on Schedule 3.16(f) hereto, Adherex (i) has not licensed or granted to anyone rights of any nature to use any of the Intellectual Property
Assets; and (ii) to Adherex’s knowledge, is not obligated to and does not pay royalties or other fees to anyone for its ownership, use, license or transfer of any of the Intellectual Property Assets. 

  

	(g)	Licenses Received. Except for computer software that is generally commercially available with a per sale copy cost of less than $2,500, all licenses or other agreements under
which Adherex is granted rights by others in Intellectual Property Assets are listed in Schedule 3.16(g) hereto. All such licenses or other agreements are in full force and effect, to the knowledge of Adherex there is no material default by any
party thereto, and, except as set forth on Schedule 3.16(g) hereto, all of the rights of Adherex thereunder are freely assignable. True and complete copies of all such licenses or other agreements, and any amendments thereto, have been provided to
the Company, and to the knowledge of Adherex, the licensors under the licenses and other agreements under which Adherex is granted rights have all requisite power and authority to grant the rights purported to be conferred thereby.

  

	(h)	Licenses Granted. All licenses or other agreements under which Adherex has granted rights to others in Intellectual Property Assets are listed in Schedule 3.16(h) hereto.
Except as set forth thereon, all such licenses or other agreements are in full force and effect, and to the knowledge of Adherex there is no material default by any party thereto. True and complete copies of all such licenses or other agreements,
and any amendments thereto, have been provided to the Company. 

  

	(i)	Affirmative Obligations. Except as set forth on Schedule 3.16(i), Adherex does not have any obligation to any third party to maintain, modify, improve or upgrade any of the
Products. 

  

	(j)	Sufficiency. To the knowledge of Adherex, the Intellectual Property Assets constitute all of the assets of Adherex used in designing, creating and developing the Products,
and are all those necessary for the operation of the business of Adherex as currently conducted and planned to be conducted, except where the failure to have any asset would not have a Material Adverse Effect. 

  

	(k)	Infringement. To the knowledge of Adherex, none of the Products manufactured and sold, or contemplated to be manufactured and sold, nor any process or know-how used, by
Adherex infringes any patent, trade-mark, service mark, trade name, copyright or other proprietary right of any person. 

  

	(l)	Non-Disclosure Contracts. Each of the Non-Disclosure Contracts (as defined below in this Section 3.16) is a valid and binding obligation of Adherex, enforceable in accordance
with its terms. 

  

 25 

	(m)	For purposes of this Section 3.16, 

  

	 	(i)	“Intellectual Property Assets” means the intellectual property assets of Adherex, necessary or appropriate for the its business as currently conducted or proposed
to be conducted, which assets consist of the following property: 

  

	 	(A)	the Products (as defined below); 

  

	 	(B)	all patents, patent applications (whether provisional or pending), patent rights, and inventions and discoveries and invention disclosures (whether or not patented) together with
any and all patents issuing thereon, including continuation, divisionals and re-issue applications and continuation-in-part applications and any United States or foreign patents granted upon such applications, based upon inventions or improvements
discovered by Adherex (collectively, “Patents”); 

  

	 	(C)	the name “Adherex”, all trade names, trade dress, logos, packaging design, slogans, Internet domain names, registered and unregistered trade-marks and service marks and
applications for any of the foregoing (collectively, “Marks”); 

  

	 	(D)	all (I) copyright registrations and applications, (II) if the failure to possess such copyrights would cause a Material Adverse Effect, copyrights that are not registered or
applications in both published and unpublished works, including without limitation all compilations, databases and computer programs and (III) derivatives, translations, adaptations and combinations of the above (collectively,
“Copyrights”); 

  

	 	(E)	all know-how, trade secrets, confidential or proprietary information, research in progress, algorithms, data, designs, processes, formulae, drawings, schematics, blueprints, flow
charts, models, prototypes, techniques, Beta testing procedures and Beta testing results (collectively, “Trade Secrets”); and 

  

	 	(F)	all goodwill, franchises, licenses, permits, consents, approvals, technical information, telephone numbers, and claims of infringement against third parties (collectively, the
“Rights”). 

  

	 	(ii)	“Products” means the items listed on Schedule 3.16(m)(ii) hereto, which consists of products that are sold, marketed, and distributed by Adherex.

  

	 	(iii)	“Non-Disclosure Contracts” means all non-disclosure and/or confidentiality agreements entered into between Adherex on the one hand, and persons in connection with
disclosures by Adherex on the other hand, relating to the Products and the Intellectual Property Assets. 

  
 3.17 Certain Contracts and Arrangements. Except as set forth in the Transaction Documents or in Schedules 3.16 or 3.17 hereto, Adherex is not a party or subject to
or bound by: 
  

	(a)	any contract or agreement (i) involving a potential commitment or payment by Adherex in excess of $75,000 or (ii) which is otherwise material and not entered into in the ordinary
course of business; 

  

 26 

	(b)	any contract, lease or agreement which is not cancelable by Adherex without penalty on less than ninety (90) days’ notice; 

  

	(c)	any contract containing covenants directly or explicitly limiting in any material respect the freedom of Adherex to compete in any line of business or with any person or entity;

  

	(d)	any contract or agreement relating to the licensing, distribution, development, purchase, sale or servicing of its products except in the ordinary course of business consistent with
past practices; 

  

	(e)	any indenture, mortgage, promissory note, loan agreement, guaranty or other agreement or commitment for borrowing or any pledge or security arrangement; 

  

	(f)	any employment contracts, non-competition agreements or other agreements with present or former officers, directors, employees or Shareholders of Adherex, or persons related to or
affiliated with such persons; 

  

	(g)	any share redemption or purchase agreements or other agreements affecting or relating to any shares of capital stock of Adherex, including, without limitation, any agreement with
any stockholder of Adherex which includes anti-dilution rights, registration rights, voting arrangements, operating covenants or similar provisions; 

  

	(h)	any pension, profit sharing, bonus, retirement, severance or stock option plans; 

  

	(i)	any royalty, dividend or similar arrangement based on the revenues or profits of Adherex or any contract or agreement involving fixed price or fixed volume arrangements;

  

	(j)	any joint venture, partnership, manufacturer, development or supply agreement; 

  

	(k)	any acquisition, merger or similar agreement; 

  

	(l)	any contract with any governmental entity; or 

  

	(m)	any other material contract not executed in the ordinary course of business. 

  

All contracts, agreements, leases and instruments set forth on Schedule 3.17 hereto are valid and are in full force and effect and constitute legal, valid and binding
obligations of Adherex and, to the knowledge of Adherex, of the other parties thereto, and are enforceable in accordance with their respective terms. Adherex does not have any knowledge of any notice or threat to terminate any such contracts,
agreements, leases or instruments. Neither Adherex nor, to the knowledge of Adherex, any other party, is in default in complying with any provisions of any such contract, agreement, lease or instrument, and no condition or event or fact exists
which, with notice, lapse of time or both, would constitute a default thereunder on the part of Adherex, except for any such default, condition, event or fact that, individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect. Other than the Transaction Documents, Adherex US is not a party to, or bound by, any agreement (written or oral), indenture, mortgage, guaranty or other instrument. 
  
 3.18 Governmental Approvals; Compliance with Laws. Each of Adherex and Adherex US is
in compliance in all respects with all applicable laws and regulations, except where the failure to be in compliance would not have a Material Adverse Effect. Except as set forth on Schedule 3.18 hereto, each 
  

 27 

 of Adherex and Adherex US has all of the permits, licenses, orders, franchises and other rights and privileges of all
federal, state or local or other foreign governmental or regulatory bodies necessary for Adherex and Adherex US to conduct its respective business as presently conducted and as contemplated to be conducted, except for those the absence of which
would cause an Material Adverse Effect. All such permits, licenses, orders, franchises and other rights and privileges are in full force and effect and, to the knowledge of Adherex or Adherex US, no suspension or cancellation of any of them is
threatened, and none of such permits, licenses, orders, franchises or other rights and privileges will be affected by the consummation of the transactions contemplated by the Transaction Documents. 
  
 3.19 Insurance Coverage. Schedule 3.19 hereto contains an accurate summary of the
insurance policies currently maintained by Adherex. There are currently no claims pending against Adherex under any insurance policies currently in effect and covering the property, business or employees of Adherex, and all premiums due and payable
with respect to the policies maintained by Adherex have been paid to date. To the knowledge of Adherex, there is no threatened termination of any such policies or arrangements. 
  

	3.20	Employee Matters. 

  

	(a)	Schedule 3.20 hereto lists and describes all the employee benefit, fringe benefit, supplemental unemployment benefit, bonus, incentive, profit sharing, termination, change of
control, pension, retirement, stock option, stock purchase, stock appreciation, health, welfare, medical, dental, disability, life insurance and similar plans, programmes, arrangements or practices relating to the current or former employees,
officers or directors of Adherex, respectively, maintained, sponsored or funded by Adherex, whether written or oral, funded or unfunded, insured or self-insured, registered or unregistered (collectively, the “Adherex Employee
Plans”). 

  

	(b)	All of the Adherex Employee Plans are and have been established, registered, qualified, invested and administered, in all respects, in accordance with their terms and all applicable
laws, including all tax laws where same is required for preferential tax treatment. No fact or circumstance exists that could adversely affect the preferential tax treatment ordinarily accorded to any such Adherex Employee Plan.

  

	(c)	All obligations regarding the Adherex Employee Plans have been satisfied, there are no outstanding defaults or violations by any party to any Adherex Employee Plan and no taxes,
penalties, or fees are owing or eligible under or in respect of any of the Adherex Employee Plans. 

  

	(d)	Adherex may unilaterally amend or terminate, in whole or in part, each Adherex Employee Plan subject only to written employment agreements as disclosed in Schedule 3.20 hereto and
approvals required by applicable laws. 

  

	(e)	No Adherex Employee Plan is subject to any examination or other proceeding, action or claim, or, to the knowledge of Adherex, pending investigation, in any case, initiated by any
regulatory authority or by any other party (other than routine claims for benefits), and there exists no state of facts which could reasonably be expected to give rise to any such investigation, examination or other proceeding, action or claim or to
affect the registration of any Adherex Employee Plan required to be registered. 

  

	(f)	All contributions or premiums required to be paid by Adherex under the terms of each Adherex Employee Plan or by applicable laws have been made in a timely fashion in accordance
with applicable laws and the terms of the Adherex Employee Plans. Adherex does not have any liability with respect to any of the Adherex Employee Plans, other than liability that accrues in the ordinary course of business under such plans after the
date hereof. 

  

 28 

	(g)	There have been no improper withdrawals, applications or transfers of assets of any Adherex Employee Plan and neither Adherex nor any of its agents or delegates, has breached any
fiduciary obligation with respect to the administration or investment of any Adherex Employee Plan. 

  

	(h)	Each Adherex Employee Plan which is a funded plan is fully funded as of the date hereof on both a going concern and a solvency basis pursuant to the actuarial assumptions and
methodology utilized in the most recent actuarial valuation therefor. 

  

	(i)	None of the Adherex Employee Plans enjoy any special tax status under any applicable laws, nor have any advance tax rulings been sought or received in respect of any Adherex
Employee Plan. 

  

	(j)	No insurance policy or any other agreement affecting any Adherex Employee Plan requires or permits a retroactive increase in contributions, premiums or other payments due
thereunder. The level of insurance reserves under each insured Adherex Employee Plan is reasonable and sufficient to provide for all incurred but unreported claims. 

  

	(k)	None of the Adherex Employee Plans (other than pension plans) provide benefits to retired employees or to the beneficiaries or dependants of retired employees.

  

	(l)	No Adherex Employee Plan is subject to ERISA, or any regulation promulgated thereunder. 

  

	3.21	Employees. 

  

	(a)	Except as otherwise set forth in Schedule 3.21(a) hereto: 

  

	 	(i)	Adherex is not and has not engaged in any unfair labour practice and no unfair labour practice complaint, grievance or arbitration proceeding is pending or, to the best of the
knowledge of Adherex, threatened against Adherex; and 

  

	 	(ii)	No collective bargaining agreement is currently being negotiated by Adherex with respect to any employees of Adherex and there are no collective agreements in force with respect to
any of its employees. No union representation question exists respecting the employees of Adherex. There is no labour strike, dispute, work slowdown or work stoppage pending or involving or, to the best of the knowledge of Adherex, threatened
against Adherex. No trade union has applied to have Adherex declared a related employer pursuant to any labour relations legislation in any jurisdiction in which Adherex carries on business. 

  
 (b) Schedule 3.21(b) hereto contains a correct and complete list of each officer and director
of Adherex (and any persons who is an affiliate of such officer or director), whether actively at work or not, their respective salaries, wage rates, commissions and consulting fees, bonus arrangements, benefits, positions, ages, status as full-time
or part-time employees and length of service. Except for the written employment agreements set forth in Schedule 3.21(b) hereto, no officer or director employee of Adherex has any agreement as to length of notice or severance payment required to
terminate his or her employment, other than such as results by applicable law from the employment of an employee without an agreement as to notice or severance. 
  

 29 

 3.22 Brokers or Finders. Except as set forth on Schedule 3.22 hereto, no person has or will have, as a result of
the transactions contemplated by this Agreement, any right, interest or claim against or upon Adherex or Adherex US for any commission, fee or other compensation as a finder or broker because of any act or omission by Adherex or Adherex US or any of
the Shareholders or their affiliates. 
  
 3.23 Environmental Matters. No
Hazardous Materials have been generated, transported, used, disposed, stored or treated by Adherex or Adherex US, except in material compliance with applicable Environmental Laws. No Hazardous Materials have been released, discharged, disposed, or
otherwise caused to enter the soil or water in, under or upon any real property owned, leased or operated by Adherex or Adherex US, except in material compliance with applicable Environmental Laws. 
  
 3.24 Corporate Records. The corporate record books of Adherex accurately record, in
all material respects, all corporate action taken by its Shareholders, the Adherex Board and all committees thereof. The copies of the corporate records of Adherex, as made available to the Company for review, are true and complete copies of the
originals of such documents. The corporate record books of Adherex US accurately record all corporate action taken by its stockholders, the Adherex US Board and all committees thereof. The copies of the corporate records of Adherex US, as made
available to the Company for review, are true and complete copies of the originals of such documents. 
  
 3.25 Customers, Distributors and Partners. Schedule 3.25 hereto sets forth the name of each customer and distributor of Adherex who accounted for more than five percent (5%) of the revenues of Adherex for the
year ended June 30, 2002 (respectively, the “Adherex Customers” and “Adherex Distributors”) together with the names of any persons or entities with which Adherex has a material strategic partnership or similar
relationship (“Adherex Partners”). No Adherex Customer, Adherex Distributor or Adherex Partner has cancelled or otherwise terminated its relationship with Adherex or has decreased materially its usage or purchases of the services or
products of Adherex. No Adherex Customer, Adherex Distributor or Adherex Partner has, to the knowledge of Adherex, any plan or intention to terminate, to cancel or otherwise materially and adversely modify its relationship with Adherex or to
decrease materially or limit its usage, purchase or distribution of the services or products of Adherex. 
  
 3.26 Tax Free Status of Merger. To the knowledge of each of Adherex and Adherex US, none of Adherex, Adherex US nor any of their respective affiliates (i) has taken or agreed to take any action, or (ii) is
aware of any fact or circumstance (other than any fact or circumstance of which the Company is also aware), which, in either case, Adherex or Adherex US has been advised would prevent the Merger from constituting a tax-free reorganization within the
meaning of Section 368(a) of the Tax Code. Except as specifically described above in this Section 3.26, neither Adherex nor Adherex US makes any representation or warranty regarding the Tax impact of the Merger on the Company or any Stockholder.

  
 ARTICLE IV  
 COVENANTS 
  
 4.1 Covenants of the Company. The Company hereby covenants and agrees with Adherex and Adherex US that prior to the Effective Time, the Company will: 

 

	(a)	subject to termination under Article VII, until the Effective Time: 

  

	 	(i)	not enter into any transaction or incur any obligation or liability, other than in the ordinary course of business or as contemplated in this Agreement or as otherwise agreed to by
Adherex; 

  

 30 

	 	(ii)	not merge into or with, amalgamate or consolidate with, enter into any other corporate reorganization with, sell all or any part of its assets to (other than in the ordinary course
of its business) any other corporation or person, or perform any act or enter into any transaction or negotiation which interferes or is inconsistent with the completion of the transactions contemplated hereby or would render inaccurate in any
material way any of the representations and warranties set forth in Article II hereof if such representations and warranties were made at a date subsequent to such act, negotiation or transaction and all references to the date of this Agreement
therein were deemed to be such later date, except as contemplated in this Agreement; and without limiting the generality of the foregoing, the Company will not, without the prior written consent of Adherex: 

  

	 	(A)	make any distribution by way of dividend, return of capital or otherwise to or for the benefit of its stockholders 

  

	 	(B)	issue any shares or other securities exercisable for, convertible into or exchangeable for shares or enter into any commitment or agreement therefor; 

  

	 	(C)	increase or decrease its authorized capital; or 

  

	 	(D)	alter or amend its charter documents including, without limitation, the Certificate of Incorporation and the By-Laws, as the same exist at the date of this Agreement;

  

	 	(iii)	do all such acts and things as may be reasonably necessary or required in order to give effect to the Merger and, without limiting the generality of the foregoing, the Company will
apply for and use its good faith efforts to obtain: 

  

	 	(A)	the approval of the Stockholders required for the consummation of the Merger; and 

  

	 	(B)	such other consents, orders and approvals as counsel may advise are necessary or desirable for the consummation of the Merger and transactions contemplated by this Agreement.

  

	(b)	give the representatives of Adherex full access, during normal business hours and upon reasonable notice, to all of the assets, properties, books, records, agreements and
commitments of the Company and furnish such information concerning the Company as Adherex may reasonably request; 

  

	(c)	use all reasonable efforts to cause each of the conditions set forth in Article VI hereof which require action by it to be satisfied on or before the time required for satisfaction;

  

	(d)	on or before the Effective Time, provide to Adherex audited financial statements for the Company for the period from inception of the Company to August 31, 2002 that present fairly
the financial condition and results of operations of the Company at such date and for the period indicated therein, prepared in accordance with US GAAP (the “Company Audited Financials”); 

  

 31 

	(e)	not prepare of file any Tax Return materially inconsistent with its past practice or take any position, make any election or adopt any method on any Tax Return that is materially
inconsistent with prior practice; 

  

	(f)	not conduct any business or commercial activities except in the ordinary course of business or as expressly contemplated by this Agreement; 

  

	(g)	timely file all required Tax Returns, taking into account extensions, and will provide copies of such income tax returns to Adherex and timely pay all Taxes that become due;

  

	(h)	prepare and deliver to Adherex, the Closing Balance Sheet; and 

  

	(i)	not take or cause to be taken any action which would disqualify the Merger as a tax-free reorganization under Section 368 of the Tax Code. 

  
 4.2 Adherex and Adherex US Covenants. Adherex and Adherex US, jointly and severally,
hereby covenant and agree with the Company that prior to the Effective Time, Adherex and Adherex US will: 
  

	(a)	subject to termination under Article VII, until the Effective Time: 

  

	 	(i)	not enter into any transaction or incur any obligation or liability other than in the ordinary course of Adherex’s business, or as contemplated by this Agreement or as
otherwise agreed to by the Company; 

  

	 	(ii)	not merge into or with, amalgamate or consolidate with, enter into any other corporate reorganization with, sell all or any part of their respective assets to any other corporation
or person, or perform any act or enter into any transaction or negotiation which interferes or is inconsistent with the completion of the transactions contemplated hereby or would render inaccurate in any material way any of the representations and
warranties set forth in Article III hereof if such representations and warranties were made at a date subsequent to such act, negotiation or transaction and all references to the date of this Agreement therein were deemed to be such later date,
except as contemplated in this Agreement and, without limiting the generality of the foregoing, neither Adherex nor Adherex US will, without the prior written consent of the Company: 

  

	 	(A)	make any distribution by way of dividend, return of capital or otherwise to or for the benefit of their respective stockholders, except for the Spin-Out as contemplated in Section
6.3(a); 

  

	 	(B)	issue any shares of their respective capital stock or other securities exercisable for, convertible into or exchangeable for such shares of capital stock or enter into any
commitment or agreement therefor; 

  

	 	(C)	increase or decrease its paid-up capital except as necessary for, or as part of, the Spin Out as contemplated by Section 6.3(a); or 

  

	 	(D)	alter or amend their respective charter documents including, without limitation, the Adherex Constating Documents, the Adherex US Certificate of Incorporation and the Adherex US
By-Laws, as the same exist at the date of this Agreement; 

  

 32 

	 	(iii)	do all such acts and things as may be reasonably necessary or required in order to give effect to the Merger and, without limiting the generality of the foregoing, Adherex will
apply for and use its good faith efforts to obtain: 

  

	 	(A)	the approval of the Shareholders required for the implementation of the Merger; and 

  

	 	(B)	such other consents, orders and approvals as counsel may advise are necessary or desirable for the implementation of the Merger and transactions contemplated by this Agreement

  

	(b)	give the representatives of the Company full access, during normal business hours and upon reasonable notice, to all of the assets, properties, books, records, agreements and
commitments of Adherex and furnish such information concerning Adherex as the Company may reasonably request; and 

  

	(c)	use all reasonable efforts to cause each of the conditions set forth in Article VI hereof which require action by it to be satisfied with on or before the time required for
satisfaction; 

  

	(d)	following the receipt of the fairness opinion described in Section 7.1(a)(v), submit to the Shareholders the Adherex Board’s recommendation that the Shareholders approve this
Agreement and the Merger (unless in the written opinion of Adherex’s legal counsel such recommendation would breach the fiduciary obligations of the Adherex Board), and to the extent required by applicable law, convene the Adherex Meeting and
solicit proxies to be voted at the Adherex Meeting in favor of the approval of this Agreement and the Merger; 

  

	(e)	not make any declaration setting aside or payment of any dividend or any other distributions in respect of any of its equity securities except as expressly permitted herein;

  

	(f)	not sell or otherwise dispose of any capital asset in excess of $25,000 or other than in the ordinary course of business consistent with its normal business practices or as
otherwise contemplated herein; 

  

	(g)	use its commercially reasonable best efforts to preserve intact its business organizations and to preserve its present relationships with any suppliers and customers;

  

	(h)	not take or cause to be taken any action which would disqualify the Merger as a tax-free reorganization under Section 368 of the Tax Code; 

  

	(i)	use its commercially reasonable best efforts to maintain in full force and effect and in the same amounts policies of insurance comparable in amount and scope of coverage now
maintained on behalf of itself and not amend or cancel any such policies of insurance; 

  

	(j)	prepare and file all Tax Returns required to be filed by it on a timely basis, taking into account extensions, and in a manner consistent with past practice and duly and timely
remit and pay all Adherex Taxes when due; 

  

	(k)	promptly notify the Company of the occurrence of any extraordinary event adversely affecting Adherex, Adherex US or their respective businesses affairs, prospects, operations,
properties, assets or conditions; 

  

 33 

	(l)	will provide all information reasonably requested by Company regarding Adherex reasonably necessary for inclusion in any proxy statement (or similar document) to be submitted by
Company to its Stockholders in connection with the approval of this Agreement and the Merger; 

  

	(m)	not enter into any transaction with any of the officers and directors of Adherex or any immediate family member of any of the foregoing, or any entity in which any of such persons
has a material interest (other than a publicly-held corporation whose stock is traded on a national securities exchange or an over the counter market and less than 1% of the stock of which is beneficially owned by such persons);

  

	(n)	except to the extent required by Adherex’s external auditors, not permit a change in its methods of maintaining its books, accounts or business records or, except as required
by Canadian GAAP (in which event prior notice shall be given to the Company), change any of its accounting principles or the methods by which such principles are applied for tax and accounting purposes; 

  

	(o)	not (i) incur any indebtedness for borrowed money other than trade debt and other obligations incurred in the ordinary course, (ii) create any fixed or floating charge, lien or
encumbrance over any part of its properties or assets, except in the ordinary course of business, (iii) make any loan to any other Person, or (iv) guarantee the liabilities of any or obligations of any other person or entity;

  

	(p)	take all actions necessary to cause Adherex US to perform its obligations under this Agreement and to consummate the Merger and the other transactions contemplated by the Merger on
the terms and subject to the conditions set forth in this Agreement; and 

  

	(q)	make all reasonable representations as are requested by legal counsel for the Company for the purpose of preparing the tax opinion referred to in Section 6.3(h) hereof.

  
 ARTICLE V 
 ADDITIONAL AGREEMENTS 
  

	5.1	Meetings of Shareholders. 

  

	(a)	The Company shall promptly after the date hereof take all action necessary in accordance with Delaware Law and its Certificate of Incorporation and By-laws to secure the approval
and adoption of this Agreement and the transactions contemplated hereby from the Stockholders. The Company shall use its best efforts to solicit from Stockholders proxies or written consents in favor of the adoption of this Agreement and the Merger
and shall take all other action necessary or advisable to secure the vote or consent of Stockholders required by Delaware Law to effect the Merger. The Company shall furnish to the Stockholders all such information concerning the Merger, this
Agreement, Adherex and Adherex US as is required pursuant to applicable securities laws, including without limitation, Regulation D of the U.S. Act (such information as amended or supplemented is referred to herein as the “Company
Information Statement”). 

  

	(b)	Adherex shall furnish to the Company such information concerning Adherex as is necessary in order for the Company Information Statement, in as far as it relates to Adherex and
Adherex US, to be prepared in accordance with all applicable rules and regulations, including without limitation, Regulation D of the U.S. Act. The information to be supplied by Adherex for inclusion in the Company Information Statement shall not,
on the date the Company Information Statement (or any amendment thereof or supplement thereto) is first mailed or otherwise 

  

 34 

 delivered to the Stockholders, at the time of any meeting of Stockholders and at the Effective Time,
contain any untrue statement of material fact or shall omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which it was made, not false or misleading. If at any time prior to
the Effective Time any event relating to Adherex or any of its affiliates, officers or directors should be discovered by Adherex which should be set forth in an amendment or a supplement to the Company Information Statement, Adherex shall promptly
inform the Company. Notwithstanding the foregoing, Adherex makes no representation or warranty with respect to any information supplied by or relating to the Company that is contained in the Company Information Statement. 
  

	(c)	Adherex shall promptly after the date hereof take all action necessary in accordance with all applicable laws and as required by the TSX and its Constating Documents to convene a
meeting of the Shareholders (the “Adherex Meeting”) to consider and approve (i) the Merger and (ii) the Share Combination. Adherex shall use its best efforts to solicit from Shareholders proxies in favour of the Merger and shall
take all other action necessary or advisable to secure the vote or consent of Shareholders required by all applicable laws and as required by the TSX to effect the Merger. 

  

	(d)	The Company shall furnish to Adherex such information concerning the Company as is necessary in order for the Information Circular (as defined herein), in as far as it relates to
the Company, to be prepared in accordance with all applicable rules and regulations. The information to be supplied by the Company for inclusion in the Information Circular to be to be sent to the shareholders of Adherex in connection with the
Adherex Meeting (such information circular as amended or supplemented is referred to herein as the “Information Circular”), shall not, on the date the Information Circular (or any amendment thereof or supplement thereto) is first
mailed to the Shareholders, at the time of Adherex Meeting and at the Effective Time, contain any untrue statement of material fact or shall omit to state any material fact necessary in order to make the statements made therein, in light of the
circumstances under which it was made, not false or misleading. If at any time prior to the Effective Time any event relating to the Company or any of its affiliates, officers or directors should be discovered by the Company which should be set
forth in an amendment or a supplement to the Information Circular, the Company shall promptly inform Adherex and Adherex US. Notwithstanding the foregoing, the Company makes no representation or warranty with respect to any information supplied by
or relating to Adherex or Adherex US that is contained in the Information Circular. 

  

	5.2	Access to Information and Confidentiality. 

  

	(a)	Upon reasonable notice and subject to restrictions contained in confidentiality agreements to which such party is subject (from which such party shall use reasonable efforts to be
released) the Company and Adherex shall each (and shall cause each of their respective subsidiaries to) afford to the officers, employees, accountants, counsel and other representatives of the other, reasonable access, during the period prior to the
Effective Time, to all its properties, books, contracts, commitments and records and, during such period, each of the Company and Adherex shall (and shall cause each of their respective subsidiaries to) furnish promptly to the other all information
concerning its business, properties and personnel as such other party may reasonably request, and each party shall make available to the other party the appropriate individuals for discussion of such party’s business, properties and personnel
as the other party may reasonably request; and 

  

 35 

	(b)	Each party will keep such information confidential in accordance with the terms of the Confidentiality Agreement attached hereto as Exhibit “F”. 

 

	5.3	Consents and Approvals. 

  

	(a)	The Company, Adherex and Adherex US shall use their reasonable best efforts to obtain all consents, waivers, approvals, authorizations or orders (including, without limitation, all
United States and Canadian governmental and regulatory rulings and approvals and approvals of the TSX), and the Company, Adherex and Adherex US shall make all filings (including, without limitation, all filings with United States and Canadian
governmental or regulatory agencies and the TSX) required in connection with the authorization, execution and delivery of this Agreement by the Company, Adherex and Adherex US, and the consummation by them of the transactions contemplated thereby.
The Company and Adherex shall furnish all information required by the other to be included in the proxy materials prepared by them or for any application or other filing to be made pursuant to the rules and regulations of any United States or
foreign governmental body in connection with the transactions contemplated by this Agreement. 

  

	(b)	Adherex shall, at its sole cost, use reasonable best efforts to obtain the conditional approval of the TSX for the listing thereon of the Merger Shares and the Warrant Shares and
shall use reasonable best efforts to obtain any other approvals, consents or authorization required by Adherex or Adherex US from applicable governmental authorities or third parties in connection with the transactions contemplated hereby, including
without limitation, the issuance of the Merger Shares and the Warrant Shares to the Stockholders. 

  
 5.4 Investment Representation Letters. The Company shall use its best efforts to cause each Stockholder to deliver to Adherex, prior to the Effective Time, a
Representation Letter. The Company shall assist Adherex in obtaining such information as Adherex reasonably requires to allow Adherex to determine the number and nature of the Stockholders in their capacity as “purchasers” (as such term is
used under Rule 506 of Regulation D promulgated under the U.S. Act (“Regulation D”)). To the extent that Adherex reasonably determines that a Stockholder is not an “accredited investor” (as such term is defined in Rule 501(a) of
Regulation D) and does not meet the financial knowledge and experience requirements of Rule 506 of Regulation D, the Company agrees that it shall use its commercially reasonable efforts to cause all such Stockholders to use a “purchaser
representative” (as such term is defined in Rule 501(h) of Regulation D) to assist such Stockholders in evaluating the Information Circular and the investment decisions represented by this Agreement, the Merger and the transactions contemplated
hereby and thereby. 
  
 5.5 Notification of Certain Matters. The Company
shall give prompt written notice to Adherex, and Adherex shall give prompt written notice to the Company, of: 
  

	(a)	the occurrence, or non-occurrence, of any event the occurrence, or non-occurrence, of which would be likely to cause any representation or warranty contained in this Agreement to be
untrue or inaccurate; 

  

	(b)	any failure of the Company, Adherex or Adherex US, as the case may be, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that the delivery of any notice pursuant to this sub-section 5.5(b) shall not limit or otherwise affect the remedies available hereunder to the party receiving such notice; and 

  

 36 

	(c)	any other non-public event or development that could reasonably be expected to materially and adversely impact such party or its ability to consummate the transactions contemplated
hereunder. 

  
 5.6 Further Action. Upon the terms and subject
to the conditions hereof, each of the parties hereto shall use all reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all other things necessary, proper or advisable to obtain in a timely manner all
necessary waivers, consents and approvals of third parties and to effect all necessary registrations and filings, and to otherwise satisfy or cause to be satisfied all conditions precedent to its obligations under this Agreement. 
  
 5.7 Public Announcements. Each of Adherex and the Company shall receive written
consent from each other before issuing any press release or otherwise making any public statements with respect to the Merger or this Agreement and shall not issue any such press release or make any such public statement prior to receiving such
consent; provided, however, that if any party is required by applicable law to make any public announcement or other disclosure with respect to the Merger or this Agreement, such party shall provide notice to the other party as soon as is reasonably
practicable and shall consult with the other party with respect to the content of such announcement or disclosure. 
  
 5.8 Board and Management. At and after the Effective Time and subject to the provisions of the CBCA, the Adherex Board will be reconstituted to consist of nine (9)
directors, four (4) of whom shall be nominees of the Company (the “Company Nominees”), four (4) of whom shall be nominees of Adherex (the “Adherex Nominees”) and one (1) of whom shall, promptly following the
Effective Time, be nominated jointly by the Company Nominees and the Adherex Nominees. The Company Nominees shall be Mark C. Rogers, Fred Mermelstein, Stephen C. Rocamboli and Bill Peters. The Adherex Nominees shall be John Brooks, Robin Norris,
Peter Morand and Ray Hessian. Mr. Rogers shall be appointed Chairman of the Adherex Board. At and after the Effective Time, Mr. Brooks shall be appointed to serve as Chief Executive Officer of Adherex, Mr. Norris shall serve as President and Chief
Operating Officer of Adherex. 
  
 5.9 Share Consolidation. At the Adherex
Meeting, Adherex shall solicit the consent of the Shareholders to effect a share consolidation on the basis of one for four (the “Share Combination”). The Share Combination shall be effective prior to the Effective Time. 

 
 5.10 Preservation of Tax-Free Status. Following the Effective Time, Adherex,
Oxiquant (as the Surviving Company following the Effective Time) and/or their respective affiliates, will not take or cause to be taken any action which would disqualify the Merger as a tax-free reorganization under Section 368 of the Tax Code. In
particular, without limiting the generality of the foregoing, prior to the fifth (5th) anniversary of the Effective Time, neither Adherex nor the Company (as the Surviving Company following the Effective Time) shall make any actual or deemed
“disposition” (as that term is defined by Treasury Regulation §1.367(a)-8 promulgated under the Tax Code) of the Surviving Company if the effect of such a “disposition” is to cause any Stockholder to recognize gain under any
gain recognition agreement entered into pursuant to Treasury Regulation §1.367(a)-8 promulgated under the Tax Code. 
  

 37 

 ARTICLE VI  
 CONDITIONS OF MERGER 
  
 6.1
Conditions for the Benefit of the Company, Adherex and Adherex US. The respective obligations of each of the Company, Adherex and Adherex US to effect the Merger shall be subject to the satisfaction at or prior to the Effective Time of the
following conditions: 
  

	(a)	the Merger and this Agreement, with or without amendment, shall have been approved and adopted by the Stockholders in accordance with the provisions of Delaware Law, and the Merger
shall have been approved by the Shareholders at the Adherex Meeting by the Shareholders in accordance with the provisions of all applicable laws, the Certificate of Incorporation, the By-Laws, the Constating Documents and the requirements of any
applicable regulatory authorities; 

  

	(b)	the TSX shall have approved the terms of the Merger and shall have conditionally approved the listing thereon of each of the Merger Shares and the Warrant Shares, subject to
compliance with the usual requirements of the TSX; 

  

	(c)	each of the persons who will be officers and directors of Adherex following the Effective Time and each other person who will hold, directly or indirectly, more than 5% of the
Common Shares following the Effective Time and each affiliate of any such person (each such officer, director, shareholder and affiliate thereof, a “Restricted Party”) shall enter into an agreement with Adherex substantially in the
form attached at Exhibit “G” hereto (each, a “Lock-up Agreement”); 

  

	(d)	all other consents, orders, regulations and approvals, including regulatory and judicial approvals and orders required or necessary or desirable for the completion of the
transactions provided for in this Agreement and the Merger shall have been obtained or received from the persons, authorities or bodies having jurisdiction in the circumstances; 

  

	(e)	there shall not be in force any order or decree of a court of competent jurisdiction, any federal, provincial, municipal or other governmental department or any commission, board,
agency or regulatory body restraining, interfering with or enjoining the consummation of the transactions contemplated by this Agreement, including, without limitation, the Merger; and 

  

	(f)	none of the consents, orders, regulations or approvals contemplated herein shall contain terms or conditions or require undertakings or security deemed unsatisfactory or
unacceptable by either of Adherex or the Company, acting reasonably. 

  
 6.2 Additional Conditions for the Benefit of Adherex and Adherex US. The obligations of Adherex and Adherex US to effect the Merger are also subject to each of the following conditions at or prior to the Effective Time: 

 

	(a)	the representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects on and as of the Effective Time, except for changes
contemplated by this Agreement, and except for those representations and warranties which address matters only as of a particular date (which shall remain true and correct as of such date) with the same force and effect as if made on and as of the
Effective Time, and Adherex and Adherex US shall have received a certificate to such effect signed by each of the President and Treasurer of the Company; 

  

	(b)	the Company shall have performed or complied in all material respects with all agreements and covenants required by this Agreement to be performed or complied with by it on or prior
to the Effective Time, and Adherex and Adherex US shall have received a certificate to such effect signed by each of the President and Treasurer of the Company; 

  

	(c)	the net liabilities of the Company as of the Effective Time shall not exceed the sum of US$100,000 plus the Company’s liabilities relating to the license agreement between the
Company and Oregon Health & Sciences University (the “Maximum Net Liability”); 

  

 38 

	(d)	all material consents, waivers, approvals, authorizations or orders required to be obtained (including consents of third parties in connection with the Intellectual Property to the
transactions contemplated hereunder), and all filings required to be made, by the Company for the authorization, execution and delivery of this Agreement and the consummation by it of the transactions contemplated hereby shall have been obtained and
made by the Company; 

  

	(e)	the Company shall have delivered to Adherex: 

  

	 	(i)	certified copies of resolutions duly passed by the Company Board approving this Agreement and the consummation of the transactions contemplated hereby; and 

 

	 	(ii)	certified copies of the resolutions of the Stockholders approving the Merger and the consummation of the transactions contemplated thereby 

  

	(f)	Adherex shall have received an Investment Representation Letter from each Stockholder other than any Dissenting Stockholders and such Investment Representation Letters shall not
reveal more than thirty-five (35) Stockholders who are not “accredited investors” (as such term is defined in Rule 501 of Regulation D) or who are not otherwise excluded from the calculation of the number of purchasers under Rule 501(e) of
Regulation D. Each Stockholder who is not an “accredited investor” (as such term is defined in Rule 501 of Regulation D) and who does not meet the sophistication requirements set forth in Rule 501 of Regulation D shall be represented by a
“purchaser representative” (as such term is defined in Rule 501(h) of Regulation D), reasonably satisfactory to Adherex and its counsel, and such purchaser representative shall have executed and delivered documentation reasonably
satisfactory to Adherex and its counsel; 

  

	(g)	Adherex shall have received a Lock-up Agreement from each Restricted Party; 

  

	(h)	the statutory period under Delaware Law for exercise of dissenter’s rights shall have elapsed without the holders of Common Stock holding more than 3% of the Common Stock
having exercised such dissenter’s rights; 

  

	(i)	the Company shall have delivered to Adherex the Certificate of Merger; 

  

	(j)	the Company shall have delivered to Adherex: (i) a certificate or certificates dated as of dates not more than two days prior to the Effective Time, from the Secretary of State of
the State of Delaware, and other corporate authorities as to the good standing, and qualification to do business, of the Company in each jurisdiction where it is so qualified and (ii) the Certificate of Incorporation of the Company, certified by the
Secretary of State of the State of Delaware as of a date not more than two days prior to the Effective Time; 

  

	(k)	the form and substance of all legal matters contemplated hereby and of all papers delivered hereunder shall be reasonably acceptable to Adherex; 

  

	(l)	no material injunction shall have been obtained, and no material suit, action or other proceeding shall be pending or threatened before any court or governmental entity in which it
is sought to restrain or prohibit or, in the reasonable belief of the Adherex Board, materially modify the consummation of the transactions contemplated hereby, or involving a claim that the consummation of the transactions contemplated hereby would
result in a violation of any law, decree or regulation of any government entity; and 

  

 39 

	(m)	Maslon Edelman Borman & Brand, LLP, legal counsel for the Company, shall have delivered to Adherex an opinion with respect to Company’s good standing, authority to enter
into Merger and enforceability of Agreement in a form acceptable to Adherex and its counsel acting reasonably. 

  
 6.3 Additional Conditions to the Obligations of the Company. The obligation of the Company to effect the Merger is also subject each of the following conditions at
or prior to the Effective Time: 
  

	(a)	Adherex shall have divested itself of all non-cancer assets and businesses of Adherex, which assets and businesses are set forth in Schedule 6.3(a) hereof to a corporation to
be created by Adherex prior to the Effective Time (collectively, the “Spin-Out”); 

  

	(b)	the representations and warranties of Adherex and Adherex US contained in this Agreement shall be true and correct in all material respects on and as of the Effective Time, except
for changes contemplated by this Agreement or the Spin-Out, and except for those representations and warranties which address matters only as of a particular date (which shall remain true and correct as of such date) with the same force and effect
as if made on and as of the Effective Time, and the Company shall have received a certificate to such effect signed by each of the President and Chief Financial Officer of each of Adherex and Adherex US; 

  

	(c)	each of Adherex and Adherex US shall have performed or complied in all material respects with all agreements and covenants required by this Agreement to be performed or complied
with by it on or prior to the Effective Time, and the Company shall have received a certificate to such effect signed by each of the President and Chief Financial Officer of each of Adherex and Adherex US; 

  

	(d)	all material consents, waivers, approvals, authorizations or orders required to be obtained, and all filings required to be made, by Adherex and Adherex US for the authorization,
execution and delivery of this Agreement and the consummation by it of the transactions contemplated hereby shall have been obtained and made by Adherex and Adherex US; 

  

	(e)	Adherex and Adherex US shall have delivered to the Company: 

  

	 	(i)	certified copies of resolutions duly passed by the Adherex Board and the Adherex US Board approving this Agreement and the consummation of the transactions contemplated hereby; and

  

	 	(ii)	certified copies of duly passed resolutions of Shareholders and the stockholder of Adherex US approving the Merger and the consummation of the transactions contemplated thereby;

  

	(f)	Adherex shall have delivered to the Company a certified copy of the approval described in sub-section 6.1(a) hereof; 

  

	(g)	the Company shall have received an opinion of its counsel that the transactions contemplated hereunder shall qualify as a tax free reorganization under Section 368 of the Tax Code
and that the Stockholders will not recognize gain for U.S. income tax purposes upon the conversion of their Common Stock for Merger Securities pursuant to the Merger; 

  

 40 

	(h)	Adherex or Adherex US (as applicable) shall have delivered to the Company: (i) a certificate or certificates dated as of dates not more than five days prior to the Effective Time,
from Industry Canada and other appropriate authorities as to the good standing, and qualification to do business, of Adherex in each jurisdiction where Adherex is so qualified; and (ii) a certified copy Constating Documents as of a date not more
than two days prior to the Effective Time; and (iii) a copy certified by the Secretary of State of the State of Delaware of the Adherex US Certificate of Incorporation as of a date not more than two days prior to the Effective Time;

  

	(i)	no material injunction shall have been obtained, and no material suit, action or other proceeding shall be pending or threatened before any court or governmental entity in which it
is sought to restrain or prohibit or, in the reasonable belief of the Company Board, materially modify the consummation of the transactions contemplated hereby, or involving a claim that the consummation of the transactions contemplated hereby would
result in a violation of any law, decree or regulation of any government entity; 

  

	(j)	the form and substance of all legal matters contemplated hereby and of all papers delivered hereunder shall be reasonably acceptable to the Company; and 

  

	(k)	Legal counsel for Adherex, shall have delivered to the Company an opinion with respect to (i) the resale of the Merger Shares and the Warrant Shares immediately following the
Effective Time pursuant Regulation S under the U.S. Act and under Canadian Securities Laws and the rules and regulations of the TSX, (ii) the good standing of Adherex and Adherex US, (iii) the authority of Adherex and Adherex US to enter into this
Agreement, (iv) the distribution of securities of the corporation to be created by Adherex prior to the Effective Time, to the existing shareholders of Adherex, in order to effect the Spin-Out shall be exempt from the prospectus and registered
dealer requirements of the securities laws of each province and territory of Canada. and (v) the enforceability of this Agreement against Adherex and Adherex US, in a form acceptable to the Company and its counsel acting reasonably.

  
 ARTICLE VII  
 TERMINATION, AMENDMENT AND WAIVER 
  

	7.1	Termination. 

  

	(a)	Subject to Section 7.2 hereof, this Agreement may be terminated by Adherex, and the Merger contemplated hereby may be abandoned at any time prior to the Effective Time,
notwithstanding approval thereof by the Shareholders, if: (i) any of the conditions in Sections 6.1 and 6.2 hereof are not satisfied by the dates specified for satisfaction, if any; (ii) if the Company breaches any of its representations,
warranties, or covenants herein in any material respect and such breach remains uncured for a period of ten days after notice of such breach provided by Adherex; (iii) if the Company breaches the Company’s obligations set forth in Article VIII
hereof; (iv) if the Effective Time does not occur prior to December 31, 2002; and (v) within five (5) days from the date of this Agreement, an independent investment banker or financial advisor has not issued an opinion to the Adherex Board
generally supporting the fairness and reasonableness to Adherex of the transactions contemplated hereby; provided that if Adherex does not provide the Company notice of its intent to terminate this Agreement pursuant to this clause (v) within such
5-day period, Adherex shall thereafter have no right to terminate this Agreement pursuant to this clause (v). Notwithstanding the foregoing, in order to terminate this Agreement by reason of breach of Section 6.2 hereof, Adherex must deliver written
notice of such termination to Company on or prior to the Effective Time; 

  

 41 

	(b)	Subject to Section 7.2 hereof, this Agreement may be terminated by the Company and the Merger contemplated hereby may be abandoned at any time prior to the Effective Time,
notwithstanding approval thereof by the Stockholders, if (i) any of the conditions in Sections 6.1 and 6.3 hereof are not satisfied by the dates specified for satisfaction, if any, (ii) if Adherex breaches any of its representations, warranties, or
covenants herein in any material respect and such breach remains uncured for a period of ten days after notice of such breach provided by the Company, (iii) if Adherex breaches any of its obligations set forth in Article VIII hereof, or (iv) if the
Effective Time does not occur prior to December 31, 2002. Notwithstanding the foregoing, in order to terminate this Agreement by reason of breach of Section 6.3 hereof, the Company must deliver written notice of such termination to Adherex on or
prior to the Effective Time. 

  
 Upon termination of this agreement
as a result of the foregoing, all parties shall return all documentation, information and any other property in its possession or control, to the owners of such property, and the parties will have no further rights or obligations to each other
except for accrued rights and obligations arising from any prior breach of this agreement, or unless expressly provided for in this Agreement. 
  
 7.2 Notice of Unfulfilled Conditions. If either of Adherex or the Company shall determine at any time prior to the Effective Time that it intends to refuse to
consummate the Merger or any of the other transactions contemplated hereby because of any unfulfilled or unperformed condition contained in this Agreement on the part of the other of them to be fulfilled or performed, Adherex or the Company, as the
case may be, shall so notify the other of them forthwith upon making such determination in order that such other of them shall have the right and opportunity to take such steps, at its own expense, as may be necessary for the purpose of fulfilling
or performing such condition within a reasonable period of time, but in no event later than ten business days after receipt of notice of such intention. 
  
 7.3 Mutual Termination. This Agreement may, at any time before or after the holding of the Adherex Meeting, but no later than the last business day immediately
preceding the Effective Time, be terminated by mutual agreement of the Adherex Board and the Company Board without further action on the part of Shareholders or the Stockholders. 
  
 7.4 Effect of Termination. In the event of the termination of this Agreement pursuant to Section 7.3 this Agreement shall forthwith
become void and there shall be no liability on the part of any party hereto except: 
  

	(a)	with respect to the obligation to return all documentation, information and any other property as provided in Section 7.1 hereof and to abide by the provisions of the
Confidentiality Agreement; and 

  

	(b)	nothing herein shall relieve any party from liability for any breach hereof. 

  

7.5 Fees and Expenses. Each party will bear its own costs in respect of the transactions contemplated hereby. 
  
 7.6 Amendment. This Agreement may be amended by the parties hereto by action taken by
or on behalf of their respective Boards of Directors at any time prior to the Effective Time; provided, however, that, after approval of the Merger by the Stockholders, no amendment may be made which would reduce the amount or change the type of
consideration into which each share of the Common Stock shall be converted upon consummation of the Merger. This Agreement may not be amended except by an instrument in writing signed by the parties hereto. 
  

 42 

	7.7	Waiver. At any time prior to the Effective Time, any party hereto may: 

  

	(a)	extend the time for the performance of any of the obligations or other acts required hereunder; 

  

	(b)	waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto; and 

  

	(c)	waive compliance with any of the agreements or conditions contained herein, in the case of each of sub-sections 7.7(a), (b) and (c), by or of the other parties hereto. Any such
extension or waiver shall be valid if set forth in an instrument in writing signed by the party or parties to be bound thereby. 

  
 ARTICLE VIII  
 EXCLUSIVITY 
  
 8.1 In consideration of the actions to be
taken and expenses to be incurred by Adherex and the Company in furtherance of this agreement without the prior written consent of the other party (which written consent shall not be unreasonably withheld or delayed), each of Adherex and the Company
agrees that until the Effective Time or termination of this Agreement by either party, each shall not solicit or negotiate any offer to buy, or offer to agree to sell, or sell, any of its assets or its shares (except as permitted in Article VI and
other than shares issued in financing transaction approved by the Adherex Board or pursuant to the exercise of options, warrants or other rights to purchase securities outstanding as of the date hereof or pursuant to incentive stock options granted
after the date hereof pursuant to Adherex’s incentive stock option plan) or any interest therein and shall not merge or enter into a business combination with or solicit or negotiate any offer to merge or enter into a business combination with
or into any corporation or entity other than the other party (each such transaction being referred to as a “Proposed Acquisition Transaction”); provided, that nothing in this clause will in any way limit Adherex or the Company from
responding to any proposal of any other person or dealing with (said “dealing with” shall exclude solicitation) any other person in respect of the foregoing that is not solicited by Adherex or the Company if in the good faith opinion of
the Adherex or the Company Board and in the written opinion of such parties’ outside counsel, a failure to do so would represent a breach of fiduciary obligations of the directors of Adherex or the Company. Each of Adherex and Company will
immediately notify the other if any discussions or negotiations are sought to be initiated, any inquiry or proposal is made, or any information is requested with respect to any Proposed Acquisition Transaction and notify the other of the terms of
any proposal which it may receive in respect of such Proposed Acquisition Transaction, including, without limitation, the identity of the prospective purchaser or acquiring party. Each of Adherex and Company shall provide the other a copy of any
written offer received in respect of a Proposed Acquisition Transaction. 
  
 8.2
Nothing contained in this Article VIII shall prohibit Adherex from taking and disclosing to Shareholders a position contemplated by Rule 14d-9 or 14e-2 promulgated under the Exchange Act or from making any disclosure to the Shareholders if, in the
good faith judgment of the Adherex Board, after consultation with outside counsel, failure to so disclose would be inconsistent with its obligations under applicable law; provided, however, that, subject to the preceding paragraph, neither Adherex
nor the Adherex Board nor any committee thereof shall withdraw, or propose publicly to withdraw, its position with respect to this Agreement or the Merger or approve or recommend, or propose publicly to approve or recommend, a competing proposal,
without providing written notice to the other parties as soon as reasonably practicable. 
  

 43 

 ARTICLE IX  
  
 [Intentionally Omitted.] 
  
 ARTICLE X 
 GENERAL
PROVISIONS 
  
 10.1 Entire Agreement. The Transaction Documents
constitute the full and entire understanding and agreement among the parties hereto with respect to the subject matters hereof and thereof, and any and all other written or oral agreements existing prior to or contemporaneously herewith are
expressly superseded and canceled. 
  
 10.2 Notices and Demands. All
notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been delivered (i) three (3) business days after being sent by registered or certified mail, return receipt requested postage pre-paid,
(ii) one (1) business day after being sent via a reputable nationwide overnight courier service guaranteeing next business day delivery, or (iii) the same business day if sent by facsimile transmission with written confirmation of transmission
during such business day, in each case to the intended recipient at the address set forth therefor, as follows: 
  

					
	 To the Company, to:
	 	 
	 	 	 Oxiquant, Inc.

	 	 	 787 Seventh Avenue

	 	 	 New York, NY 10019

	 	 	 Facsimile:
	 	 (212) 554-4355

	 	 	 Attention:
	 	 Secretary

		
	 Each with a copy to:
	 	 
	 	 	 Maslon Edelman Borman & Brand, LLP

	 	 	 3300 Wells Fargo Center

	 	 	 90 South Seventh Street

	 	 	 Minneapolis, MN 55402

	 	 	 Facsimile:
	 	 612-642-8358

	 	 	 Attention:
	 	 William M. Mower

		
	 To Adherex or Adherex US, to:
	 	 
	 	 	 Adherex Technologies Inc.

	 	 	 600 Peter Morand Crescent

	 	 	 Ottawa, ON K1G 5Z3

	 	 	 Facsimile:
	 	 (613) 738-9060

	 	 	 Attention:
	 	 John Brooks

		
	 Each with a copy to:
	 	 
	 	 	 LaBarge Weinstein

	 	 	 333 Preston Street, 11th Floor

	 	 	 Ottawa, Ontario K15 5N4

	 	 	 Facsimile:
	 	 (613) 231-3900

	 	 	 Attention:
	 	 Randy L. Taylor

  
 or to such other address or fax number
of which any party may notify the other parties as provided above. Notices shall be effective as of the date of such delivery, mailing or fax. 
  

 44 

 10.3 Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to
be effective and valid under applicable law, but if any provision of this Agreement shall be deemed prohibited or invalid under such applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, and such
prohibition or invalidity shall not invalidate the remainder of such provision or the other provisions of this Agreement. 
  
 10.4 Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of the parties hereto and by virtue of their approval of the Merger,
the Stockholders, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. 
  
 10.5 Counterparts. This Agreement may be executed in multiple counterparts, each of
which shall constitute an original but all of which shall constitute but one and the same instrument. One or more counterparts of this Agreement may be delivered via facsimile transmission, with the intention that they shall have the same effect as
an original counterpart hereof. 
  
 10.6 Effect of Headings; Construction.
The descriptive headings in this Agreement have been inserted for convenience only and shall not be deemed to limit or otherwise affect the construction of any provision thereof or hereof. The parties have participated jointly in the negotiation and
drafting of the Transaction Documents with counsel sophisticated in investment transactions. In the event an ambiguity or question of intent or interpretation arises, this Agreement and the agreements, documents and instruments executed and
delivered in connection herewith shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement and the
agreements, documents and instruments executed and delivered in connection herewith. 
  
 10.7 Governing Law. This Agreement shall be interpreted, construed and governed by and in accordance with the internal laws of the State of Delaware. In the event of any action or proceeding commenced by the Company arising out of
this Agreement, or the negotiation, validity or performance hereof or the transactions contemplated herein, such action or proceeding shall be venued in the Superior Court of Justice of the Province of Ontario in the City of Ottawa, Ontario and, in
the event of any action or proceeding commenced by either of Adherex or Adherex US arising out of this Agreement, or the negotiation, validity or performance hereof or the transactions contemplated herein, such action or proceeding shall be venued
in the United States District Court for the Southern District of New York. 
  
 10.8 Certain Definitions. For the purposes of this Agreement, the following definitions shall apply: 
  

	(a)	“affiliate” means a person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, the first
mentioned person; including, without limitation, any partnership or joint venture in which the person (either alone, or through or together with any other subsidiary) has, directly or indirectly, an interest of 5% or more; 

 

	(b)	“beneficial owner” with respect to any shares of the Common Stock, means a person who shall be deemed to be the beneficial owner of such shares:

  

	 	(i)	which such person or any of its affiliates or associates beneficially owns, directly or indirectly; 

  

 45 

	 	(ii)	which such person or any of its affiliates or associates (as such term is defined in Rule 12b-2 of the Exchange Act) has, directly or indirectly: 

  

	 	(A)	the right to acquire (whether such right is exercisable immediately or subject only to the passage of time), pursuant to any agreement, arrangement or understanding or upon the
exercise of consideration rights, exchange rights, warrants or options, or otherwise; or 

  

	 	(B)	the right to vote pursuant to any agreement, arrangement or understanding; or 

  

	 	(iii)	which are beneficially owned, directly or indirectly, by any other persons with whom such person or any of its affiliates or persons with whom such person or any of its affiliates
or associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares; 

  

	(c)	“business day” means any day other than a day on which banks in the City of Ottawa, Province of Ontario or in the State of New York are required or authorized to be
closed; 

  

	(d)	“Closing Balance Sheet” means an unaudited balance sheet of the Company prepared accordance with US GAAP, on a basis consistent with the Company Audited Financials
as of a date that is within three (3) days of the Effective Time and mutually acceptable to the Company and Adherex. The Closing Balance Sheet shall include the then outstanding amounts under any lines of credit and accrued expenses in connection
with the transactions contemplated hereunder; 

  

	(e)	“Common Shares” has the meaning ascribed thereto in Section 3.3; 

  

	(f)	“Common Stock” means the common stock of the Company, par value $0.001 per share; 

  

	(g)	“Confidentiality Agreement” means the Confidentiality Agreement dated on or about July 18 2002, between Adherex and the Company; 

  

	(h)	“control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, or as trustee or
executor, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of stock, as trustee or executor, by contract or credit arrangement or otherwise; 

  

	(i)	“Derivative Securities” shall mean (i) all Adherex Rights (other than any Unvested Options) outstanding immediately prior to or at the Effective Time (A) with a
right to purchase or otherwise acquire Common Shares at a price of less than CND$1.00 per share (as equitably adjusted for stock splits, combinations and the like), or (B) that expire on or after the date that is three years from the Effective Time,
and (ii) all Common Shares issuable under Vested Options; 

  

	(j)	“Environmental Laws” means all applicable Canadian or United States federal, state, provincial, local and foreign laws, rules, regulations, codes, ordinances,
orders, decrees, directives, permits, licenses and judgments relating to pollution, contamination or protection of the environment (including, without limitation, all applicable federal, state, provincial, local and foreign laws, rules, regulations,
codes, ordinances, orders, decrees, directives, permits, licenses and judgments relating to Hazardous Materials in effect as of the date of this Agreement); 

  

 46 

	(k)	“Exchange Ratio” means the number equal to the quotient resulting from dividing (i) the number of Common Shares issued and outstanding immediately prior to the
Effective Time but after giving effect to the Share Combination, by (ii) the number of shares of Common Stock issued and outstanding immediately prior to the Effective Time; 

  

	(l)	“Hazardous Materials” means any dangerous, toxic or hazardous pollutant, contaminant, chemical, waste, material or substance as defined in or governed by any
federal, state or local law, statute, code, ordinance, regulation, rule or other requirement relating to such substance or otherwise relating to the environment or human health or safety, including without limitation any waste, material, substance,
pollutant or contaminant that might cause any injury to human health or safety or to the environment or might subject any Person to any imposition of costs or liability under any Environmental Law; 

  

	(m)	“Material Adverse Effect” means, with respect to any person, a material adverse effect on such person’s business, assets, condition (financial or otherwise),
liabilities, prospects or results of operations of such person; 

  

	(n)	“Option Plan” means the employee stock option plan of Adherex in effect as of the date hereof; 

  

	(o)	“person” means an individual, corporation, partnership, association, trust, unincorporated organization, other entity or group (as defined in Section 13(d)(3) of
the Exchange Act); 

  

	(p)	“Public Documents” means any and all documents filed with securities commissions or similar regulatory authorities in the US or Canada; 

  

	(q)	“Shareholder” means a holder of any Common Shares; 

  

	(r)	“Stockholder” means a holder of any shares of Common Stock; 

  

	(s)	“subsidiary” or “subsidiaries” of the Company, the Surviving Company, Adherex or any other person means any corporation, partnership, joint venture
or other legal entity of which the Company, the Surviving Company, Adherex or such other person, as the case may be, (either alone or through or together with any other subsidiary) owns, directly or indirectly, more than 50% of the stock or other
equity interests the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity; 

  

	(t)	“Tax Code” means the United States’ Internal Revenue Code of 1986, as amended; 

  

	(u)	“Transaction Documents” means (i) this Agreement (including the schedules and exhibits attached hereto), (ii) the Certificate of Merger, (iii) the Investment
Representation Letters, (iv) the Lock-Up Agreements, (v) the certificates required to be delivered pursuant to each of Sections 6.2(j) and 6.3(e), (vi) the items required to be delivered pursuant to Sections 6.2(a), 6.2(b), 6.2(e) and 6.2(j),
6.3(b), 6.3(c), 6.3(e) and 6.3(f); 

  

	(v)	“TSX” means The Toronto Stock Exchange; 

  

	(w)	“Unvested Options” means those options to purchase Common Shares granted pursuant to the Option Plan and outstanding at or immediately prior to the Effective Time
that are not otherwise Vested Options; 

  

 47 

	(x)	“Vested Options” means those options to purchase Common Shares granted pursuant to the Option Plan and outstanding at or immediately prior to the Effective Time
that (i) have either (A) an exercise price of less than $1.00 (as equitably adjusted for stock splits, combinations and the like) or (B) an expiry date later than that date which is three (3) years following the Effective Time and (ii) have vested
pursuant to the provisions of the Option Plan at or prior to or at the Effective Time; 

  

	(y)	“Warrant Exchange Ratio” means the number of Common Shares purchasable under all of the Derivative Securities (after giving effect to the Share Combination),
divided by the number of shares of Common Stock outstanding immediately prior to the Effective Time; and 

  

	(z)	“Warrant Purchase Price” means the weighted average price per share at which Common Shares may be acquired upon exercise or conversion of the Derivative Securities.

  
 10.9 Disclaimer Regarding Tax Status. The Company and the
Stockholders have obtained and are relying solely on their own independent legal advice regarding the tax implications of the Merger on the Company or any Stockholder and whether the Merger constitutes a tax-free reorganization within the meaning of
Section 368(a) of the Tax Code. 
  
 10.10 Further Assurances.
Notwithstanding any provision to the contrary contained herein, without further consideration, the parties hereto agree that after the Effective Time, each will take all appropriate action and execute any documents, instruments or conveyances of any
kind which may be reasonably necessary or advisable to carry out the provisions of this Agreement. 
  
 10.11 Funds. Unless otherwise clearly stated, all references to dollar amounts contained in this Agreement shall refer to lawful money of the United States of America. 
  
 [THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 
  

 48 

 IN WITNESS WHEREOF, the undersigned have executed this Merger Agreement as of the day and year
first above written. 
  

			
	 	 	ADHEREX TECHNOLOGIES INC.
		
	 Per:
	 	 /s/ John Brooks

	 Name:
	 	 John Brooks

	 Title:
	 	 Chief Executive Officer

		
	 	 	 ADHEREX, INC.

		
	 Per:
	 	 /s/ John Brooks

	 Name:
	 	 John Brooks

	 Title:
	 	 Chief Executive Officer

		
	 	 	 OXIQUANT, INC.

		
	 Per:
	 	 /s/ Fred Mermelstein

	 Name:
	 	 Fred Mermelstein

	 Title:
	 	 PresidentEXCLUSIVE LICENSE AGREEMENT, DATED AS OF NOVEMBER 14, 2002

 EXHIBIT 4.7 
  

EXCLUSIVE LICENSE AGREEMENT 
  
 This Exclusive License Agreement (“Agreement”) dated as of November 14, 2002 is by and between Adherex Technologies Inc., a
corporation incorporated and existing under the laws of Canada, having its principal office at 600 Peter Morand Crescent, Ottawa, Ontario, K1G 5Z3 (“Adherex”) and Cadherin Biomedical Inc., a corporation incorporated and
existing under the laws of Canada, having its principal office at 600 Peter Morand Crescent, Ottawa, Ontario K1Z 5Z3 (“Cadherin”). 
  
 WHEREAS, Adherex is the owner or licensee of certain rights related to its proprietary cell adhesion platform technology; 
  
 WHEREAS, Adherex agrees to grant, and Cadherin desires to obtain, a license
to such rights for use in all fields other than cancer; 
  
 NOW,
THEREFORE, in consideration of the mutual promises hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: 
  

	1.	DEFINITIONS. 

  
 1.1 “Affiliate” means any corporation or other entity which controls, is controlled by, or is under common control with a party to this
Agreement. A corporation or other entity shall be regarded as in control of another corporation or entity if it owns or directly or indirectly controls more than fifty percent (50%) of the voting stock or other ownership interest of the other
corporation or entity, or if it possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of the corporation or other entity or the power to elect or appoint fifty percent (50%) or more of the
members of the governing body of the corporation or other entity. 
  
 1.2 “Compound Exclusivity” means the exclusive right to make, have made, use, research, develop and commercialize (in the respective field) a compound, however, it does not provide any rights to Adherex in the Non-Cancer
Field or to Cadherin in the Adherex Fields. 
  
 1.3
“Confidential Information” means any confidential or proprietary information furnished by one party to the other party in connection with this Agreement, provided that (i) such information is specifically designated as confidential
in writing at the time of disclosure, or (ii) a reasonable person receiving such information would understand such information to be confidential or proprietary information of the disclosing party in the context of disclosure. 
  
 1.4 “Effective Date” means November 14, 2002. 
  
 1.5 “Fair Market Value” means the gross sales price or value
which Cadherin would realize from an unaffiliated, unrelated buyer in an arm’s length sale or exchange of consideration for an identical product or service sold or provided in the same quantity and at the same time and place as the sale or
exchange for which the Fair Market Value is to be determined. 

 1.6 “Gross Revenues” means all incomes, revenues, receipts, monies, up-front payments,
fees and considerations paid to Cadherin by a third party and that are directly or indirectly attributable to: (i) the sale, by Cadherin, of McGill Products; (ii) the provision of Services by Cadherin; (iii) option agreements, licenses or
sublicenses granted by Cadherin to a third party with respect to McGill Products or to the Technology in the Field; (iv) manufacturing payments for McGill Products, whether received in cash or by way of other benefit, advantage, or concession. Gross
Revenues shall however exclude all revenues from research and development agreements and all material transfer agreements, provided that such agreements do not include license grants or commercialization rights with respect to any aspect of the
Technology in the Field. If received in a form other than cash, the applicable revenue will be the monetary equivalent or Fair Market Value of the benefit, advantage, or concession. For greater certainty, Gross Revenues do not include amounts paid
to Cadherin from any Affiliate, amounts paid by Cadherin to any Affiliate or any amount paid from one Affiliate of Cadherin to another Affiliate of Cadherin. 
  
 1.7 “Improvement” shall mean any discovery or invention conceived or reduced to practice, solely or jointly, by or on behalf of Adherex
or Cadherin during the term of this Agreement which is dominated by the Patent Rights. For purposes of this Agreement, an Improvement shall be “dominated” by the Patent Rights if, absent a license, the practice of such Improvement
would directly or indirectly infringe one or more valid claims of the Patent Rights (assuming for the purposes of this definition only that both parties require a license hereunder to practice the Patent Rights). 
  
 1.8 “Licensed Patent” shall have the meaning set forth in
the McGill License Agreement. 
  
 1.9 “McGill License
Agreement” means the General Collaboration Agreement between McGill University and Adherex dated as of February 26, 2001. 
  
 1.10 “McGill Product” means any Product in the Field as defined in the McGill License Agreement. 
  
 1.11 “Non-Cancer Field” means any use or application in
humans or animals other than the prevention, treatment, prognosis or diagnosis of cancer and the side effects of cancer treatment. It shall include drug delivery, however, Adherex retains an exclusive, worldwide, royalty free right to use any
drug delivery technology licensed through this Agreement for the prevention, treatment, prognosis or diagnosis of cancer. 
  
 1.12 “Patent Rights” means (i) the United States and foreign patent applications and patents listed on Exhibit A, and (ii) any and
all continuations, divisionals, or continuations-in-part applications thereto, and any patents that issue therefrom, including any extensions, renewals, reissues, or re-examinations thereof. For the avoidance of doubt, it is agreed that Patent
Rights shall include any Licensed Patent licensed to Adherex under the McGill License Agreement. Adherex retains Compound Exclusivity for Exherin. 
  

 2 

 1.13 “Pre-clinical Development Program” means the creation and implementation of a
formal development program to conduct scientific studies required or necessary for the filing of an investigational new drug application (or its in a equivalent in a foreign domicile). 
  
 1.14 “Product” means (i) any McGill Product, or (ii) any other product whose manufacture, use, sale, or
import would, absent the license granted to Cadherin hereunder, infringe one or more valid claims of the Patent Rights, or (iii) any other product or service made or delivered using a method or process the use or practice of which
would, absent the license granted to Cadherin hereunder, infringe one or more valid claims of the Patent Rights. 
  
 1.15 “Technology in the Field” shall have the meaning set forth in the McGill License Agreement. 
  
 1.16 “Territory” means the world. 
  
 1.17 “Term” has the meaning defined in Section 9.1 hereof.

  

	2.	LICENSE GRANTS. 

  
 2.1 Grant to Cadherin. In consideration of a portion of the compensation paid by Cadherin to Adherex under the Merger Agreement, and subject to the
terms and conditions set forth in this Agreement including, without limitation, Section 2.4 hereof, Adherex hereby grants to Cadherin, under the Patent Rights and during the Term, an exclusive (even against Adherex itself), worldwide license, with
the right to sublicense in accordance with Section 2.2 hereof, to make, have made, use, offer for sale, sell, and import any Products within the Non-Cancer Field as defined in section in 1.11. Other than the payment obligation to Adherex to satisfy
requirements of the McGill License Agreement as set forth in Section 3.2 below, the foregoing license shall be fully-paid and royalty-free. The license granted hereunder is exclusive to Cadherin to the extent that Adherex itself may not make, have
made, use, offer for sale, sell and import any Products within the Non-Cancer Field and in the Territory during the Term, and further provided, that during the Term, Adherex may not grant to any third parties whatsoever any sublicensing rights or
similar rights of any nature to make, have made, use, offer for sale, sell and import any Products within the Non-Cancer Field and in the Territory. 
  
 2.2 Sublicense. Any sublicense by Cadherin of the rights granted to Cadherin under Section 2.1 shall be consistent with the terms of this Agreement
and shall include an obligation for the sublicensee to comply with the applicable provisions of this Agreement including, without limitation, Section 5 (Confidentiality and Publication), Section 8.1 (Indemnification) and Section 11.1 (Use of Name).
Cadherin shall notify Adherex of the existence of any sublicense of the rights granted herein within ten (10) business days of entering into such sublicense. 
  
 2.3 License to Improvements. 
  
 (a) To Cadherin. Subject to the terms and conditions set forth in this Agreement including, without limitation, Section 2.4 hereof, Adherex hereby
grants to Cadherin, under any intellectual property rights owned or controlled by Adherex which claim an Improvement conceived or reduced to practice by Adherex, a non-exclusive, royalty-free, worldwide license, without the right to sublicense, to
make, have made, use, offer for sale, sell, and import any Products within the Non-Cancer Field. 
  

 3 

 (b) To Adherex. Subject to the terms and conditions set forth in this Agreement including, without
limitation, Section 2.4 hereof, Cadherin hereby grants to Adherex, under any intellectual property rights owned or controlled by Cadherin which claim an Improvement conceived or reduced to practice by Cadherin, a non-exclusive worldwide license,
without the right to sublicense, to make, have made, use, offer for sale, sell, and import any products within the Adherex Fields. 
  
 2.4 Exclusivity. Notwithstanding any other provision of this Agreement to the contrary, the parties agree that: 
  
 (a) in the event that Adherex or its Affiliates or sublicensees intend to
commercialize any specific compound or molecule covered by the Patent Rights as a product in one or more of the Adherex Fields and has begun bona fide preclinical development on such product, and Adherex reasonably believes that the
commercialization of the same compound or molecule (or any salt substitution of such compound or molecule which shall be collectively referred to herein as the “Compound Group”) by Cadherin in the Non-Cancer Field would adversely
impact the commercialization of such compound or molecule by Adherex in the Adherex Fields, then unless Cadherin has first provided notice to Adherex under Section 2.4(b) below, Adherex shall have Compound Exclusivity to such Compound Group and
Cadherin shall not have a right to make, have made, use, offer for sale, sell or import such Compound Group as a Product in the Non-Cancer Field. 
  
 (b) Subject to 2.4(a) above, in the event that Cadherin, its Affiliates or sublicensees, intend to commercialize any specific compound or molecule as a
Product in the Non-Cancer Field and has begun bona fide preclinical development work on such Product, and Cadherin reasonably believes that the commercialization of the same Compound Group by Adherex in the Adherex Fields would adversely impact the
commercialization of such compound or molecule by Cadherin in the Non-Cancer Field, then Cadherin shall notify Adherex in writing. Adherex shall reply to such notification within fifteen (15) business days indicating whether or not Adherex has begun
or intends to begin bona fide pre-clinical development work on such Compound Group. 
  
 (i) If Adherex notifies Cadherin that Adherex has begun or intends to begin such bona fide preclinical development work, then Cadherin shall be denied Compound Exclusivity over such Compound Group and Adherex shall
have Compound Exclusivity over such Compound Group under Section 2.4(a) above. 
  
 (ii) If Adherex notifies Cadherin that Adherex has not begun and does not intend to begin such bona fide preclinical development work and Adherex has not first provided notice to Cadherin under Section 2.4(a) above,
Cadherin shall have Compound Exclusivity over such Compound Group upon payment to Adherex of Twenty Thousand Dollars ($20,000) per Compound Group, and Adherex shall not have the right to make, have made, use, offer for sale, sell, or import such
Compound Group covered by the Patent Rights as a product in the Adherex Fields. Notwithstanding the foregoing or any other clause in this Agreement, Cadherin will not have the right to make, have made, use, offer for sale, sell, or import any
Compound Group covered by the Patent Rights as a product in the Adherex Fields. 
  

 4 

 (c) In order for Adherex to maintain Compound Exclusivity over a Compound Group under Section 2.4(a)
above, it must (i) initiate a Preclinical Development Program within three (3) months of providing notice to Cadherin that it intends to develop such Compound Group and (ii) file for an IND for one or more compounds in the Compound Group with the
United States FDA or comparable filing with the competent foreign agency in Canada, Japan or a country of the European Union within fifteen (15) months of providing notice to Cadherin that it intends to commence pre-clinical development of a
Compound Group. In order for Cadherin to maintain Compound Exclusivity over a Compound Group under Section 2.4(b)(ii) above, Cadherin must file for an investigational new drug (IND) application for one or more compounds in the Compound Group with
the United States FDA or comparable filing with the competent foreign agency in Canada, Japan or a country of the European Union within fifteen (15) months after acquiring Compound Exclusivity over such Compound Group. 
  
 (d) In the event that either party fails to timely satisfy its obligations
set forth in Section 2.4(c) above, then either (i) such party may extend the period of exclusivity for up to an additional twelve (12) months by paying the other party Ten Thousand Dollars ($10,000) per month per Compound Group until such time as an
IND is filed, or (ii) such party shall lose exclusivity for such Compound Group. In the event such party fails to timely satisfy its obligations under this Section 2.4(d)(i) within the three (3) month period, or loses exclusivity under Section
2.4(d)(ii), or abandons development of a Compound Group, then either party shall be free to develop and commercialize such Compound Group, and may request exclusivity in accordance with the terms of this Section 2.4. In this event, the $20,000 under
Section 2.4 (b)(ii) shall not apply. 
  
 2.5 No Implied
License. Except as expressly set forth herein, no license, express or implied, under any intellectual property rights owned or controlled or developed hereunder by either party is granted to the other party. It is understood and agreed that
nothing in this Agreement grants Cadherin any rights outside of the Non-Cancer Field and Adherex retains no rights in any field except the Adherex Fields. 
  
 2.6 Technology Transfer Costs. Cadherin shall also reimburse Adherex for all reasonable and actual out-of-pocket costs for transferring materials
and information comprising including any time expended by Adherex professional staff in the requested transfer activities. These technical transfer costs and charges shall be due and payable thirty (30) days after receipt by Cadherin of an invoice
from Adherex itemizing such costs on a periodic (monthly) basis. 
  

	3.	CONSIDERATION UNDER McGILL LICENSE AGREEMENT. 

  
 3.1 Consent. The parties acknowledge that McGill has consented to the sublicense of the Licensed Patents (as defined in the McGill License
Agreement) in accordance with the consent letter in the form attached hereto as Exhibit B. 
  
 3.2 Payments To McGill. In consideration of the sublicense granted to Cadherin pursuant to this Agreement under the Licensed Patent and Technology
in the Field, Cadherin 
  

 5 

 shall pay to Adherex, in the manner designated below, an earned royalty of two percent (2%) of the Gross Revenue received
by Cadherin for any McGill Product. The parties agree that Adherex shall be obligated to make all payments to McGill pursuant to Section 6.1 of the McGill License Agreement. All payments due Adherex hereunder shall be paid within forty-five (45)
days following the end of the calendar quarter in which such payment accrues and shall be paid in Canadian dollars or as otherwise agreed by the parties. All payments shall be remitted to Adherex’s address given in Section 11.2 hereof or to
such other address as Adherex shall direct. 
  
 Cadherin shall pay
to Adherex interest on any amount not paid when due. Such interest will accrue from the fifteenth (15th) day after
the payment was due at a rate of two percent (2%) above the daily prime interest rate, as determined by Royal Bank of Canada or its successor entity, on each day the payment is delinquent, and the interest payment will be due and payable on the
first day of each month after interest begins to accrue, until fully payment of all amounts due Adherex is made. 
  
 Cadherin shall keep, at its own expense, accurate books of account, using accepted accounting procedures, detailing all data necessary to calculate and
easily audit any payments due to Adherex from Cadherin under this Agreement. 
  
 Upon at least fifteen (15) days’ written notice, Adherex shall have the right, through an independent accounting firm, to examine such records and books of account of Cadherin as are necessary to verify
compliance with the terms of this Agreement. Such right may be exercised only once during any twelve-month period. Such examination may be performed at any time within three (3) years after the end of the reporting period to which the books of
account pertain, and shall be performed during normal business hours at Cadherin’s major place of business or at such other site as may be agreed upon by Adherex and Cadherin. The accounting firm may make abstracts or copies of such books of
account solely for its use in performing the examination. Adherex shall require prior to any such examination, such accounting firm to agree in writing that such firm will maintain all information, abstracts, and copies acquired during such
examination in strict confidence and will not make any use of such material other than to confirm to Adherex the accuracy of Cadherin’s compliance hereunder. Adherex shall provide Cadherin with a copy of any reports and conclusions resulting
from any such examination upon receipt of same. 
  
 If any
examination of Cadherin’s records shows that Cadherin has paid more than required under this Agreement, any excess amounts shall, at Cadherin’s option, be promptly refunded or credited against future royalties with interest from the date
of overpayment at the Royal Bank of Canada’s Prime Rate minus 1%. If any examination of Cadherin’s records shows that Cadherin has paid less than required under this Agreement, Cadherin shall promptly pay the additional amount due together
with interest and late fees as required under this Agreement for late payments. If the amount of underpayment exceeds ten percent (10%) of the amount that should have been paid, Cadherin shall also pay all reasonable costs of such examination.

  
 3.3 Other Obligations under the McGill License
Agreement. The parties agree that Adherex shall remain obligated to make all payments to McGill pursuant to the following sections of the McGill License Agreement: Section 5.2 (Diligence Payments), Section 5.3 (Sponsored Research), Section 5.4
(Additional Research) and Section 5.5 (CIHR University/Industry Chair). Cadherin shall have no right to direct any of the research programs provided for under the McGill License. 
  

 6 

	4.	NON COMPETITION. 

  
 4.1 Distinguishing the Product. Cadherin will use its best efforts to develop methods of use and administration, formulations of pharmaceutical
compounds, and packaging for all of the Products licensed by Cadherin under this Agreement to support the regulatory approval of each Product developed by Cadherin in a way that distinguishes such Product’s or Products’ use in the
Non-Cancer Field from the Adherex Field. 
  
 Adherex will use its
best efforts to develop methods of use and administration, formulations of pharmaceutical compounds, and packaging for all of the Products to support the regulatory approval of each Product developed by Adherex in a way that distinguishes such
Product’s or Products’ use in the Adherex Field from the Non-Cancer Field. 
  
 4.2 Off-label Use. Both parties shall not in any way position and use all reasonable efforts to avoid off-label usage. Should either party identify that there is off-label usage of a Product, it shall
immediately notify the other party of this usage. The party selling the Product will take all reasonable steps to minimize this off-label usage and pay the other party a royalty to compensate for lost sales. If the parties cannot agree on the amount
of the royalty, both agree to submit to binding arbitration. 
  
 4.3 Avoidance of Adherex Field. For the term of this Agreement, Cadherin will not develop any Products in the Adherex Field based upon the technology in the Patent Rights or Improvements or upon cell adhesion technology. In addition,
as long as there is any officer or director of Cadherin who is also an officer or director of Adherex, Cadherin will not develop or seek to acquire any Products in the Adherex Field. 
  

	5.	CONFIDENTIALITY AND PUBLICATION. 

  
 5.1 Obligations. During the Term of this Agreement and for a period of five (5) years thereafter, each party (the “Receiving
Party”) shall maintain in confidence and use only for the purposes specifically authorized in this Agreement the Confidential Information disclosed by the other party (the “Disclosing Party”), except that the Receiving
Party may disclose or permit the disclosure of Confidential Information to its directors, officers, employees, consultants and advisors who are obligated to maintain the confidential nature of the such Confidential Information and who need to know
such Confidential Information for the purposes of this Agreement. 
  
 5.2 Exceptions. The foregoing obligations of the Receiving Party shall not apply to the extent the Receiving Party can demonstrate that certain Confidential Information (i) was in the public domain prior to the time of its disclosure
under this Agreement, (ii) entered the public domain after the time of its disclosure under this Agreement through means other than an unauthorized disclosure resulting from an act or omission of the Receiving Party; (iii) was independently
developed or discovered by the Receiving Party without use of the Confidential Information, but only provided such independent development is evidenced by contemporaneous written documentation, (iv) is or was disclosed to the Receiving Party at any
time, whether prior 
  

 7 

 to or after the time of its disclosure under this Agreement, by a third party having no fiduciary relationship with the
Disclosing Party and having no obligation of confidentiality with respect to such Confidential Information, or (v) is required to be disclosed to comply with applicable laws or regulations, or with a court or administrative order, provided,
that the Disclosing Party receives prior written notice of such disclosure and that the Receiving Party takes all reasonable and lawful actions to obtain confidential treatment for such disclosure and, if possible, to minimize the extent of the
disclosure. 
  
 5.3 Return. Upon the expiration or
termination of this Agreement, and at the request of the Disclosing Party, the Receiving Party shall return to the Disclosing Party all originals, copies and summaries of documents, materials, and other tangible manifestations of Confidential
Information in the possession or control of the Receiving Party, except that the Receiving Party may retain one copy of the Confidential Information in the possession of its legal counsel solely for the purpose of monitoring its obligations under
this Agreement. 
  
 5.4 Right to Publication. Adherex
agrees that Cadherin shall have the right to publish or to present publicly (collectively, a “Publication”) the results of any research, work or other development performed pursuant to this Agreement by or on behalf of Cadherin
(collectively, “Results”). Cadherin agrees to submit any proposed Publication to Adherex where such Publication may have patent implications for review at least twenty (20) days prior to submission of presentation of such Publication. If
Adherex requests a delay in submission or presentation based on patent considerations, Cadherin agrees to delay such submission or presentation for a period not to exceed ninety (90) days from the date of such request. Cadherin further agrees to
give due consideration to any comments made by Adherex, with respect to such publication but, except as set forth in the immediate following sentence, Cadherin shall determine the content of the Publication. Nothing in this Section 9.5 shall be
construed to allow Cadherin to publish or otherwise disclose any Confidential Information disclosed to Cadherin by Adherex. 
  

	6.	PATENT PROSECUTION. 

  
 Except as provided below, and subject to the applicable terms of the McGill License Agreement, Adherex shall have the sole and exclusive right to file,
prosecute and maintain the Patent Rights in the Territory, using patent counsel reasonably acceptable to Cadherin, at Adherex’s expense. Adherex shall keep Cadherin informed regarding the status and prosecution of all patent applications and
patents comprising the Patent Rights. 
  
 In the event that
Adherex determines on a country-by-country basis in the Territory that it will not, for any reason, file or prosecute any patent application or maintain any patent within the Patent Rights, it will notify Cadherin of its decision promptly and in no
event later than fifteen (15) days prior to the date of abandonment of such patent application or patent. Cadherin shall thereafter have the sole and exclusive right but not the obligation to undertake and control such filing, prosecution or
maintenance at its own cost and expense, subject to the applicable terms of the McGill License Agreement. In such event, Adherex shall cooperate with Cadherin and provide such nonmonetary assistance as Cadherin may reasonably request. 
  

 8 

	7.	PATENT RIGHTS INFRINGEMENT. 

  
 7.1 Notification. Each party will inform the other promptly in writing of any alleged infringement of the Patent Rights by a third party and of any
available evidence thereof, as well as any facts which may affect the validity, scope or enforceability of the Patent Rights of which either party becomes aware. 
  
 7.2 Cadherin Right to Prosecute. Subject to the applicable terms of the McGill License Agreement, Cadherin shall have
the first right, but shall not be obligated, to commence legal action at its own expense to defend against a declaratory action alleging invalidity or non-infringement of the Patent Rights or to prosecute all infringements of the Patent Rights where
such infringements are occurring in the Non-Cancer Field and in the Territory. Adherex shall have the right to receive, from time to time at its request, full and complete information from Cadherin concerning the status of any such litigation.
Adherex shall, at the request and expense of Cadherin, provide reasonable cooperation in any such litigation. The total cost of any such action commenced solely by Cadherin (and with respect to which Adherex does not elect to become an intervening
party, as hereinafter provided) shall be borne by Cadherin, and Cadherin shall retain any recovery or damages derived therefrom. 
  
 In the event that Cadherin institutes a court proceeding relating to infringement of the Patent Rights in the Non-Cancer Field and in the Territory,
Adherex shall have the right to intervene in such proceeding and Cadherin shall not oppose such intervention, provided that (i) Adherex notifies the court and Cadherin of its intention to intervene within 180 days of the commencement of such
proceeding, and (ii) Adherex shares equally with Cadherin the total costs incurred by Cadherin (including without limitation attorney and expert fees) of conducting such proceeding. Cadherin shall retain control of the conduct and settlement of any
such proceeding; provided further, however, that no settlement, consent judgment or other voluntary final disposition of the suit may be entered into without the consent of Adherex, which consent shall not be unreasonably withheld or delayed. Any
recovery of damages for any such proceeding (or settlement thereof) shall be applied first in satisfaction of any out-of-pocket expenses incurred by the parties relating to the proceeding (including without limitation attorney and expert fees), and
the balance shall be equally divided between the parties. 
  
 7.3
Adherex Right to Prosecute. In the event that Cadherin declines to commence legal action to defend against a declaratory action alleging invalidity of the Patent Rights or to prosecute infringements of the Patent Rights in the Non-Cancer
Field and in the Territory, Cadherin shall notify Adherex of its decision promptly in writing (and in no event later than 10 days thereafter). Thereafter, Adherex shall have the right, but shall not be obligated, to commence legal action at its own
expense to defend or prosecute such infringements relating to the Patent Rights, subject to the applicable terms of the McGill License Agreement. Cadherin agrees that Adherex may include Cadherin as a party in any such suit subject to indemnifying
Cadherin against any order for costs or other damages that may be made against Cadherin in such proceedings. No settlement, consent judgment or other voluntary final disposition of the suit may be entered into without the consent of Cadherin, which
consent shall not be unreasonably withheld or delayed. Cadherin shall have the right to receive, from time to time at its request, full and complete information from Adherex concerning the status of any such litigation. Cadherin shall, at the
request and expense of Adherex, provide reasonable cooperation in any such litigation. The total cost of any such action commenced solely by Adherex shall be borne by Adherex, and Adherex shall retain any recovery or damages derived therefrom.

  

 9 

	8.	INDEMNIFICATION. 

  
 8.1 Indemnification of Adherex. Cadherin shall, and shall cause its sublicensees to, at all times during the Term of this Agreement and thereafter,
indemnify, defend and hold harmless Adherex and its directors, officers, employees, stockholders and agents (“Adherex Indemnitees”) against all third party claims, suits, actions, proceedings, demands, expenses, costs, damages,
deficiencies, losses, liabilities or judgments of any kind whatsoever, including without limitation legal expenses and attorneys’ fees, (“Claims”) based upon, arising out of or otherwise relating to the grant of rights to
Cadherin under this Agreement including, without limitation, any cause of action relating to product liability or the death of or injury to any person or person or out of any damage to property, resulting from the production, manufacture, sale, use,
consumption or advertisement of any Product made by or on behalf of Cadherin. Notwithstanding the foregoing, Cadherin shall have no obligation to indemnify any Adherex Indemnitees to the extent any Claim arises out of the negligence or willful
misconduct of any Adherex Indemnitees under this Agreement, or arises out of any breach of any representation of Adherex under this Agreement. 
  
 8.2 Conditions to Indemnification. The obligations of Cadherin under Section 8.1 are conditioned upon: (i) the written notice to Cadherin of any
potential liability promptly after the Adherex Indemnitee becomes aware of such potential liability (provided that the failure to give such prompt notice shall not affect Cadherin’s indemnification obligations except to the extent that Cadherin
is actually prejudiced thereby); (ii) Cadherin having the right to assume the defense or settlement of any suit or claim related to the liability; (iii) the Adherex Indemnitees providing reasonable assistance in connection with the defense and
settlement. Cadherin shall not enter into any settlement which admits or concedes that any aspect of the Patent Rights is invalid or unenforceable, or otherwise negatively affects the rights or obligations of Adherex without Adherex’s consent,
which consent shall not be unreasonably withheld. If Cadherin defends the suit or claim, the Adherex Indemnitees may participate in (but not control) the defense thereof at its sole cost and expense. Notwithstanding the foregoing, if, in the
reasonable judgment of the Adherex Indemnitees, such suit or claim involves an issue or matter which could have a materially adverse effect on the business operations or assets of the Adherex Indemitee, the Adherex Indemnitee may waive its rights to
indemnity under this Agreement and control the defense or settlement thereof. 
  

	9.	TERM AND TERMINATION. 

  
 9.1 Term. This Agreement becomes effective as of the Effective Date and, unless sooner terminated in accordance with the provisions of Section 9.2
below, remains in force on a country-by-country basis until the expiration of the last-to-expire of the Patent Rights (the “Term”). 
  
 9.2 Termination for Breach. This Agreement may be terminated by either party upon written notice of any material breach or default by the other
party under this Agreement that the breaching party fails to remedy within thirty (30) days after the written notice thereof by the non-breaching party. Moreover, if any action or inaction by Cadherin hereunder shall cause Adherex 
  

 10 

 to be in material breach of the McGill License Agreement, Adherex may terminate this Agreement upon 30 days notice,
provided however, that Cadherin does not take appropriate measures to assist Adherex to cure such breach within such 30 day period. 
  
 9.3 Bankruptcy. Adherex shall also have the right to terminate this Agreement if: 
  
 a) Cadherin becomes bankrupt or generally fails to pay its debts as such debts become due; is adjudicated insolvent or
bankrupt; admits in writing its inability to pay its debts; or shall suffer a custodian, receiver or trustee for it or substantially all of its property to be appointed and, if appointed without its consent, not be discharged within thirty (30)
days; makes an assignment for the benefit of creditors; or suffers proceedings under any law related to bankruptcy, insolvency, liquidation or the reorganization, readjustment or the release of debtors to be instituted against it and, if contested
by it, not dismissed or stayed within thirty (30) days; 
  
 b) any
order for relief is entered relating to any of the proceedings described in Paragraph 9.3(a); or 
  
 c) Cadherin shall by any act or failure to act indicate its consent to, approval of or acquiescence in any of the proceedings described in Paragraphs
9.3(a) or (b). 
  
 9.4 Effect of Expiration or Termination.
Expiration or termination of this Agreement shall not relieve the parties of any obligation that accrued prior to such expiration or termination. The provisions of Sections 5, 8, 9, 10 and 11 shall survive any termination or expiration of this
Agreement. The provisions of Section 7 shall survive any termination or expiration of this Agreement for the duration of any litigation or proceeding that was commenced prior to the effective date of such termination or expiration. 
  
 In the event that this Agreement is terminated by either party pursuant to
Section 9.2, the license rights granted to Cadherin pursuant to Section 2.1 and 2.3 shall terminate and Cadherin shall immediately cease to manufacture and sell the Products; provided however, that Cadherin may dispose of its inventory of
Products on hand as of the effective date of termination and may fill any orders for Products accepted prior to the effective date of termination. The license rights granted to Adherex pursuant to Section 2.3 shall survive any termination or
expiration of this Agreement. 
  
 9.5 McGill License
Agreement. Adherex shall notify Cadherin in writing in the event of any termination of the McGill License Agreement. The parties acknowledge that, pursuant to Section 3.2 of the McGill License Agreement, in the event of termination of the McGill
License Agreement and provided that the obligations of Adherex pursuant to Sections 5.3 and 5.5 of the McGill License Agreement have been satisfied within sixty (60) days following such termination, McGill will honour the sublicense of Licensed
Patent and Licensed Technology (as defined in the McGill License Agreement) granted by Adherex to Cadherin hereunder, provided that Cadherin agrees to be bound in respect of McGill by the terms of this Agreement relating to the payments pursuant to
Section 3.2 hereof, including, without limiting the generality of the foregoing, the following provisions hereof: Section 9.1 (Term), Section 3.2 (Payments to McGill), Section 9.2 (Termination for Breach) and Section 9.3 (Effect of Expiration or
Termination). Cadherin shall have no obligation to McGill to keep the sublicense in force, in 
  

 11 

 which case the sublicense shall immediately terminate and Cadherin shall immediately cease to use, manufacture or have
manufactured, sell, lease or otherwise exploit or transfer the Licensed Patent and Licensed Technology (as defined in the McGill License Agreement). Should Cadherin intend to continue to use, manufacture or have manufactured, sell, lease or
otherwise exploit or transfer the Licensed Patent or Licensed Technology (as defined in the McGill License Agreement), it shall provide McGill with written notice of such intent, along with a copy of the sublicense agreement to which it is a party
within sixty (60) days of the termination of the McGill License Agreement. 
  
 Pursuant to Section 13.2 of the McGill License Agreement, in the event of insolvency of Adherex, McGill shall undertake to offer existing Adherex sublicensees (including Cadherin) a right of first offer to rights to
the Licensed Patent. The rights granted in such a license will reflect the rights granted in the original sublicense and the terms offered will consider monies spent by the sublicensee in the development of the Licensed Technology. 
  

	10.	WARRANTIES AND DISCLAIMERS. 

  
 10.1 Authorization. Each party represents and warrants to the other that it has the legal right and power to enter into this Agreement and to fully
perform its obligations hereunder. 
  
 10.2 By Adherex.
Adherex represents and warrants to Cadherin that (i) it has the lawful right to grant the license to Cadherin set forth hereunder, and (ii) as of the Effective Date and during the Term, it has not granted and will not grant to any third party, any
right or license under the Patent Rights in the Non-Cancer Field in the Territory, and (iii) during the Term, it will not itself make, have made, use, sell or import any Products within the Non-Cancer Field and in the Territory. Adherex represents
to Cadherin to use commercially reasonable efforts to maintain the McGill License Agreement in full force and effect. 
  
 10.3 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY HERETO MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF
ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR VALIDITY OR ENFORCEMENT OF THE PATENT RIGHTS. NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED AS A REPRESENTATION MADE
OR A WARRANTY GIVEN BY ADHEREX THAT THE PRACTICE BY CADHERIN OF THE PATENT RIGHTS SHALL NOT INFRINGE THE INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY. 
  

	11.	MISCELLANEOUS. 

  
 11.1 Use of Names. Except as required by law or otherwise set forth in the Merger Agreement, neither party shall use the name of the other party or
any of their respective officers, employees, consultants, or agents in any press release, promotional material or other publicity without the prior written consent of the other party. 
  

 12 

 11.2 Notice. Any notices or other communications required or permitted hereunder shall be
sufficiently given if delivered personally, sent by reputable overnight delivery service (such as Federal Express or Airborne Express) or sent by first class certified mail, postage prepaid, addressed as follows or to such other address of which the
parties may have given notice: 
  

			
	 To Adherex:            
	    	Adherex Technologies Inc.
	 	    	Attention: Chief Executive Officer
	 	    	600 Peter Morand Crescent
	 	    	Ottawa, Ontario K1G 5Z3
	 	    	Canada
		
	 To Cadherin:
	    	Cadherin Biomedical Inc.
	 	    	Attention: Chief Executive Officer
	 	    	600 Peter Morand Crescent
	 	    	Ottawa, Ontario K1G 5Z3
	 	    	Canada

  
 Unless otherwise
specified herein, such notices or other communications shall be deemed received (a) on the date delivered, if delivered personally, (b) one business day after being sent, if sent by reputable overnight delivery service or (c) three business days
after being sent, if sent by certified mail. 
  
 11.3
Assignment. This Agreement may not be assigned or otherwise transferred by Cadherin without the consent of Adherex, such consent not to be unreasonably withheld or delayed, except either party may assign this Agreement without the consent of
the other party to an Affiliate or in connection with the transfer or sale of all or substantially all of the portion of its business to which this Agreement relates, or in the event of its merger or consolidation or change in control or similar
transaction. Any purported assignment in violation of this Section shall be void. Any permitted assignee shall assume all obligations of its assignor under this Agreement in writing. 
  
 11.4 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Province of
Ontario, without giving effect to principles of conflict or choice of laws. 
  
 11.5 Arbitration. Both parties agree to binding arbitration in the event any dispute arising out of this agreement can not be resolved between them. 
  
 11.6 Entire Agreement; Amendments. This Agreement represents the entire understanding and agreement between the
parties hereto with respect to the subject matter hereof and supersede all prior oral and written and all contemporaneous oral negotiations, commitments and understandings between such parties. This Agreement may not be modified or amended except by
a written agreement duly executed by both parties hereto. 
  
 11.7
Waivers. No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any waiver on the part of any party of any such right, power or privilege, nor any single or partial
exercise of any such right, power or privilege, preclude any further exercise thereof or the exercise of any other such right, power or privilege. The rights and remedies of any party based upon, arising out of or otherwise in 
  

 13 

 respect of any inaccuracy in or breach of any representation, warranty, covenant or agreement contained in this Agreement
shall in no way be limited by the fact that the act, omission, occurrence or other state of facts upon which any claim of any such inaccuracy or breach is based may also be the subject matter of any other representation, warranty, covenant or
agreement contained in this Agreement (or in any other agreement between the parties) as to which there is not inaccuracy or breach. 
  
 11.6 Section Headings. The section headings are for the convenience of the parties and in no way alter, modify, amend, limit, or restrict the
contractual obligations of the parties. 
  
 11.7
Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. 
  
 11.8 Third Party Beneficiaries. The parties hereto agree that this Agreement is not intended to create any third
party beneficiaries, other than the Adherex Indemnitees pursuant to Section 8.1 hereof. 
  
 11.9 Relationship of the Parties. Adherex and Cadherin are independent contractors under this Agreement. Nothing contained in this Agreement is intended nor is it to be construed so as to constitute Adherex and
Cadherin as partners or joint venturers with respect to this Agreement. Employees of any party remain employees of said party and shall at no time be considered agents of or to be obligated to render a fiduciary duty to the other party. 

 
 11.10 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which shall be one and the same document. 
  

 14 

 IN WITNESS WHEREOF, this Exclusive License Agreement has been duly executed as an instrument under seal by the parties
hereto as of and on the date first above written. 
  

							
	 ADHEREX TECHNOLOGIES INC.
	 	 CADHERIN BIOMEDICAL INC.

				
	 	 	 /s/ John Brooks

	 	 	 	 /s/ John Brooks

	 Title:
	 	 	 	 Title:
	 	 
	Date: November 14, 2002	 	 Date: November 14, 2002

  

 15 

 Exhibit A 
 Patent
Rights 

 Exhibit B 
 McGill
Consent Letter 
  
 McGill University 
  
 Attention:
                     
  
 RE: Sublicense Consent 
  
 Dear                             : 
  
 As you know, Adherex Technologies Inc. (“Adherex”) is
entering into an Exclusive License Agreement (“Agreement”) with Cadherin Biomedical Inc. (“Cadherin”) under which Adherex will, among other things, sublicense to Cadherin in the non-cancer field the rights licensed
by McGill University (“McGill”) to Adherex under the General Collaboration Agreement between McGill and Adherex dated              (the “McGill License
Agreement”). 
  
 For good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, McGill and Adherex agree as follows: 
  
 1. In accordance with Section 3.2(a) of the McGill License Agreement, McGill hereby consents to the sublicensing to Cadherin of the Licensed Patent and Licensed Technology (as such terms are defined in the McGill
License Agreement), with the right for Cadherin to further sublicense such rights. McGill acknowledges that it has reviewed a copy of the Agreement and hereby consents to its terms. 
  
 2. Adherex agrees that, as full and complete consideration under the sublicense granted to Cadherin in the Agreement, the sufficiency of
which McGill hereby acknowledges, Adherex shall pay to McGill any and all amounts received by Adherex from Cadherin under Section 3.2 of the Agreement (which amounts shall equal two percent (2%) of the Gross Revenue (as defined in the Agreement)
payable by Cadherin for any McGill Product (as defined in the Agreement)). 
  
 3.
The Agreement shall not in any way diminish, reduce or eliminate any of Adherex’s duties or obligations under the McGill License Agreement, and Adherex shall remain primarily liable to McGill for all of Adherex’s duties and obligations
contained in the McGill License Agreement. 
  
 Please indicate
your agreement with the terms of this letter by signing both copies of this letter in the space provided below and returning it to me. 
  

	
	 Sincerely,

	  
  

	 Adherex Technologies Inc.

 Agreed and accepted: 
  
 McGill University 
  

	
	  

	Name:
	
	Date:

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