Document:

Exhibit 10.1

 

 

STANDARD OFFER, AGREEMENT
AND ESCROW INSTRUCTIONS

 FOR PURCHASE OF REAL ESTATE

(Non-Residential)

 

Dated: September
13, 2019

 

	1.	Buyer.

 

1.1      
Charles S. Alemi or assignee, ("Buyer")
hereby offers to purchase the real property, hereinafter described, from the owner thereof ("Seller") (collectively,
the "Parties" or individually, a "Party"), through an escrow ("Escrow") to
close 15 days after
the waiver or expiration of the Buyer's Contingencies, ("Expected Closing Date") to be held by Heritage
Escrow Company - Janet Tilbury ("Escrow Holder") whose address is
2855 Michelle Drive, Suite 270, Irvine, CA 92606, Phone
No. (949) 930-8500, Facsimile
No. ------- upon the terms
and conditions set forth in this agreement ("Agreement"). Buyer shall have the right to assign Buyer's rights
hereunder, but any such assignment shall not relieve Buyer of Buyer's obligations herein unless Seller expressly releases Buyer.

 

1.2      
The term "Date of Agreement" as used herein shall be the date when by execution and delivery (as defined
in paragraph 20.2) of this document or a subsequent counteroffer thereto, Buyer and Seller have reached agreement in writing
whereby Seller agrees to sell, and Buyer agrees to purchase, the Property upon terms accepted by both Parties.

 

	2.	Property.

 

2.1     The real property ("Property") that is the subject of this offer consists of (insert a brief physical
description) an approximate 39,043 square foot industrial building is located in the County of Orange,
is commonly known as (street address, city, state, zip) 1500
Lakeview Loop, Anaheim, CA 92807 and is legally described as: To
be provided by Escrow (APN: 346-291-26 ).

 

2.2     If the legal description of the Property is not complete or is inaccurate, this Agreement shall not be invalid and the
legal description shall be completed or corrected to meet the requirements of First
American Title Insurance Company ("Title Company"), which shall issue the title policy hereinafter
described.

 

2.3     The Property includes, at no additional cost to Buyer, the permanent improvements thereon, including those items which
pursuant to applicable law are a part of the property, as well as the following items, if any, owned by Seller and at present
located on the Property: electrical distribution systems (power panel, bus ducting, conduits, disconnects, lighting fixtures);
telephone distribution systems (lines, jacks and connections only); space heaters; heating, ventilating, air conditioning equipment
("HVAC"); air lines; fire sprinkler systems; security and fire detection systems; carpets; window
coverings; wall coverings; and (collectively, the "Improvements").

 

2.4     The
fire sprinkler monitor:  ̈ is owned by Seller and included in the
Purchase Price,  ̈ is leased by Seller, and Buyer will need to negotiate a
new lease with the fire monitoring company, x ownership will
be determined during Escrow,  ̈ or there is no fire sprinkler
monitor.

 

2.5    
Except as provided in Paragraph 2.3, the Purchase Price does not include Seller's personal property, furniture and
furnishings, and the two-story prefab office structure all of which shall be removed by Seller prior to end
of Leaseback Term. (See Paragraph 26.1).

 

	3.	Purchase Price.

 

3.1    
The purchase price ("Purchase Price") to be paid by Buyer to Seller for the Property shall be $7,075,000.00, payable as follows: (Strike any not applicable)

 

		(a)	Cash down payment, including the Deposit as defined in paragraph 4.3 (or if an all cash transaction, the Purchase Price):	 $150,000.00

 

		(b)	Amount of "New Loan" as defined in paragraph 5.1, if any:	TBD

 

	Total Purchase Price:	$7,075,000.00

 

3.2    
If Buyer is taking title to the Property subject to, or assuming, an Existing Deed of Trust and such deed of trust permits
the beneficiary to demand payment of fees including, but not limited to, points, processing fees, and appraisal fees as
a condition to the transfer of the Property, Buyer agrees to pay such fees up to a maximum of 1.5% of the unpaid principal balance
of the applicable Existing Note.

 

	4.	Deposits.

 

4.1      ̈
Buyer has delivered to Broker a check in the sum of __________, payable to Escrow Holder, to be delivered by Broker to Escrow Holder within 2 business days after both Parties have executed this
Agreement and the executed Agreement has been delivered to Escrow Holder, or, x
within 2 business days after both Parties have executed this Agreement and the executed Agreement has been delivered
to Escrow Holder Buyer shall deliver to Escrow Holder a check in the sum of $100,000.00. If said check is not received
by Escrow Holder within said time period then Seller may elect to unilaterally terminate this transaction by giving
written notice of such election to Escrow Holder whereupon neither Party shall have any further liability to the other under
this Agreement. Should Buyer and Seller not enter into an agreement for purchase and sale, Buyer's check or funds shall,
upon request by Buyer, be promptly returned to Buyer.

 

 4.2     Additional deposits:

 

(a)      Within
5 business days after the Date of Agreement, Buyer shall deposit with Escrow Holder the additional sum of ___________ to
be applied to the Purchase Price at the Closing.

 

 (b)      Within 2 business days after the contingencies discussed in paragraph 9.1 (a) through (m) are approved or waived, Buyer shall deposit with Escrow Holder the additional sum of $50,000.00 to be applied to the Purchase Price at the Closing.

 

(c)      
If an Additional Deposit is not received by Escrow Holder within the time period provided then Seller may notify Buyer,
Escrow Holder, and Brokers, in writing that, unless the Additional Deposit is received by Escrow Holder within 2 business days
following said notice, the Escrow shall be deemed terminated without further notice or instructions.

 

4.3     
Escrow Holder shall deposit the funds deposited with it by Buyer pursuant to paragraphs 4.1 and 4.2 (collectively the "Deposit"),
in a State or Federally chartered bank in an interest bearing account whose term is appropriate and consistent with the timing
requirements of this transaction. The interest therefrom shall accrue to the benefit of Buyer, who hereby acknowledges that
there may be penalties or interest forfeitures if the applicable instrument is redeemed prior to its specified maturity.
Buyer's Federal Tax Identification Number is TBD. NOTE: Such interest bearing account cannot be opened until Buyer's Federal Tax Identification Number is provided.

 

4.4    
Notwithstanding the foregoing, within 5 days after Escrow Holder receives the monies described in paragraph 4.1 above,
Escrow Holder shall release $100 of said monies to Seller as and for independent consideration for Seller's' execution of this
Agreement and the granting of the contingency period to Buyer as herein provided. Such independent consideration is non-refundable
to Buyer but shall be credited to the Purchase Price in the event that the purchase of the Property is completed.

 

4.5    
Upon waiver of all of Buyer's contingencies the Deposit shall become non-refundable but applicable to the Purchase Price
except in the event of a Seller breach, or in the event that the Escrow is terminated pursuant to the provisions of Paragraph
9.1(n) (Destruction, Damage or Loss) or 9.1(o) (Material Change).

 

    
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	5.	Financing Contingency. (Strike if not applicable)

 

5.1    
This offer is contingent upon Buyer obtaining from an insurance company, financial institution or other lender,
a commitment to lend to Buyer a sum equal to at least TBD% of the Purchase Price, on terms reasonably acceptable to Buyer. Such loan ("New Loan") shall be secured by a
first deed of trust or mortgage on the Property. If this Agreement provides for Seller to carry back junior financing,
then Seller shall have the right to approve the terms of the New Loan. Seller shall have 7 days from receipt of the commitment
setting forth the proposed terms of the New Loan to approve or disapprove of such proposed terms. If Seller fails to notify Escrow
Holder, in writing, of the disapproval within said 7 days it shall be conclusively presumed that Seller has approved the terms
of the New Loan.

 

5.2    
If Buyer shall fail to notify its Broker, Escrow Holder and Seller, in writing within 45 days following the Date
of Agreement, that the New Loan has not been obtained, it shall be conclusively presumed that Buyer has either obtained said New
Loan or has waived this New Loan contingency.

 

5.3    
If Buyer shall notify its Broker, Escrow Holder and Seller, in writing, within the time specified in paragraph 5.2
hereof, that Buyer has not obtained said New Loan, this Agreement shall be terminated, and Buyer shall be entitled to the prompt
return of the Deposit, plus any interest earned thereon, less only Escrow Holder and Title Company cancellation fees and costs,
which Buyer shall pay.

 

	6.	Seller Financing (Purchase Money Note)
                                         (strike if not applicable).

 

	7.	Real Estate Brokers.

 

7.1    
Each Party acknowledges receiving a Disclosure Regarding Real Estate Agency Relationship, confirms and consents to
the following agency relationships in this transaction with the following real estate broker(s) ("Brokers") and/or
their agents ("Agent(s)"):

 

Seller’s
Brokerage Firm Ashwill Associates Commercial
Real Estate License No. 01291393 is
the broker of (check one): x the Seller; or  ̈
both the Buyer and Seller (dual agent).

 

Seller's
Agent Steve Bryant License No. 00560937 is (check one): x the Seller's Agent (salesperson or broker associate);
or both the Seller's Agent and the Buyer's Agent (dual agent).

 

Buyer's
Brokerage Firm Bryan Industrial Properties, Inc.
& Newmark Knight Frank License No. 00002442
(Bryan Industrial) & 01355491 (Newmark Knight Frank) is the broker of
(check one): x the Buyer; or  ̈
both the Buyer and Seller (dual agent).

 

Buyer's
Agent John Maresca & Troy Williams License
No. 00896979 (JM) & 01053444 (TW) is (check
one): x the Buyer's Agent (salesperson or broker associate); or  ̈
both the Buyer's Agent and the Seller's Agent (dual agent).

 

The Parties acknowledge that other than the
Brokers and Agents listed above, there are no other brokers or agents representing the Parties or due any fees and/or commissions
under this Agreement. See paragraph 24 regarding the nature of a real estate agency relationship. Buyer shall use the services
of Buyer's Broker exclusively in connection with any and all negotiations and offers with respect to the Property for a
period of 1 year from the date inserted for reference purposes at the top of page 1.

 

7.2    
Buyer and Seller each represent and warrant to the other that he/she/it has had no dealings with any person, firm,
broker, agent or finder in connection with the negotiation of this Agreement and/or the consummation of the purchase and
sale contemplated herein, other than the Brokers and Agents named in paragraph 7.1, and no broker, agent or other person, firm
or entity, other than said Brokers and Agents is/are entitled to any commission or finder's fee in connection with this
transaction as the result of any dealings or acts of such Party. Buyer and Seller do each hereby agree to indemnify, defend, protect
and hold the other harmless from and against any costs, expenses or liability for compensation, commission or charges which may
be claimed by any broker, agent, finder or other similar party, other than said named Brokers and Agents by reason of any
dealings or act of the indemnifying Party.

 

	8.	Escrow and Closing.

 

8.1    
Upon acceptance hereof by Seller, this Agreement, including any counteroffers incorporated herein by the Parties,
shall constitute not only the agreement of purchase and sale between Buyer and Seller, but also instructions to Escrow Holder
for the consummation of the Agreement through the Escrow. Escrow Holder shall not prepare any further escrow instructions restating
or amending the Agreement unless specifically so instructed by the Parties or a Broker herein. Subject to the reasonable
approval of the Parties, Escrow Holder may, however, include its standard general escrow provisions. In the event that there is
any conflict between the provisions of the Agreement and the provisions of any additional escrow instructions the provisions
of the Agreement shall prevail as to the Parties and the Escrow Holder.

 

8.2    
As soon as practical after the receipt of this Agreement and any relevant counteroffers, Escrow Holder shall ascertain
the Date of Agreement as defined in paragraphs 1.2 and 20.2 and advise the Parties and Brokers, in writing, of the date
ascertained.

 

8.3     Escrow
Holder is hereby authorized and instructed to conduct the Escrow in accordance with this Agreement, applicable law and custom
and practice of the community in which Escrow Holder is located, including any reporting requirements of the Internal Revenue
Code. In the event of a conflict between the law of the state where the Property is located and the law of the state
where the Escrow Holder is located, the law of the state where the Property is located shall prevail.

 

8.4    
Subject to satisfaction of the contingencies herein described, Escrow Holder shall close this escrow (the "Closing")
by recording a general warranty deed (a grant deed in California) and the other documents required to be recorded, and by disbursing
the funds and documents in accordance with this Agreement.

 

8.5    
Buyer and Seller shall each pay one-half of the Escrow Holder's charges and Seller shall pay the usual recording fees and
any required documentary transfer taxes. Seller shall pay the premium for a standard coverage owner's or joint protection policy
of title insurance. (See also paragraph 11.)

 

8.6    
Escrow Holder shall verify that all of Buyer's contingencies have been satisfied or waived prior to Closing. The
matters contained in paragraphs 9.1 subparagraphs (b), (c), (d), (e), (g), (i), (n), and (o), 9.4, 12, 13, 14, 16, 18, 20, 21,
22, and 24 are, however, matters of agreement between the Parties only and are not instructions to Escrow Holder.

 

8.7    
If this transaction is terminated for non-satisfaction and non-waiver of a Buyer's Contingency, as defined in Paragraph
9.2 or disapproval of any other matter subject to Buyer’s approval, then neither of the Parties shall thereafter have any
liability to the other under this Agreement, except to the extent of a breach of any affirmative covenant or warranty in
this Agreement. In the event of such termination, Buyer shall, subject to the provisions of paragraph 8.10, be promptly refunded
all funds deposited by Buyer with Escrow Holder, less only the $100 provided for in paragraph 4.4 and the Title Company and Escrow
Holder cancellation fees and costs, all of which shall be Buyer's obligation. If this transaction is terminated as a result of
Seller's breach of this Agreement then Seller shall pay the Title Company and Escrow Holder cancellation fees and costs.

 

8.8    
The Closing shall occur on the Expected Closing Date, or as soon thereafter as the Escrow is in condition for Closing;
provided, however, that if the Closing does not occur by the Expected Closing Date and said Date is not extended by mutual instructions
of the Parties, a Party not then in default under this Agreement may notify the other Party, Escrow Holder, and Brokers, in writing
that, unless the Closing occurs within 5 business days following said notice, the Escrow shall be deemed terminated without further
notice or instructions.

 

8.9    
Except as otherwise provided herein, the termination of Escrow shall not relieve or release either Party from any obligation
to pay Escrow Holder's fees and costs or constitute a waiver, release or discharge of any breach or default that has occurred
in the performance of the obligations, agreements, covenants or warranties contained therein.

 

8.10  
If this sale of the Property is not consummated for any reason other than Seller's breach or default, then at Seller's
request, and as a condition to any obligation to return Buyer's deposit (see paragraph 21), Buyer shall within 5 days after written
request deliver to Seller, at no charge, copies of all surveys, engineering studies, soil reports, maps, master plans, feasibility
studies and other similar items prepared by or for Buyer that pertain to the Property. Provided, however, that Buyer shall not
be required to deliver any such report if the written contract which Buyer entered into with the consultant who prepared such
report specifically forbids the dissemination of the report to others.

 

	9.	Contingencies to Closing.

 

9.1    
The Closing of this transaction is contingent upon the satisfaction or waiver of the following contingencies. IF BUYER
FAILS TO NOTIFY ESCROW HOLDER, IN WRITING, OF THE DISAPPROVAL OF ANY OF SAID CONTINGENCIES WITHIN THE TIME SPECIFIED THEREIN,
IT SHALL BE CONCLUSIVELY PRESUMED THAT BUYER HAS APPROVED SUCH ITEM, MATTER OR DOCUMENT. Buyer's conditional approval shall
constitute disapproval, unless provision is made by the Seller within the time specified therefore by the Buyer in such
conditional approval or by this Agreement, whichever is later, for the satisfaction of the condition imposed by the Buyer. Escrow
Holder shall promptly provide all Parties with copies of any written disapproval or conditional approval which it receives. With
regard to subparagraphs (a) through (m) the pre-printed time periods shall control unless a different number of days is
inserted in the spaces provided.

 

(a)      Disclosure.
Seller shall make to Buyer, through Escrow, all of the applicable disclosures required by law (See AIR
CRE ("AIR") standard form entitled "Seller's Mandatory Disclosure Statement") and provide Buyer
with a completed Property Information Sheet ("Property Information Sheet") concerning the Property,
duly executed by or on behalf of Seller in the current form or equivalent to that published by the AIR within 10 or
_____________ days following the Date of Agreement. Buyer has 10 days from the receipt of said disclosures to approve or
disapprove the matters disclosed.

 

(b)     
Physical Inspection. Buyer has 45
days following the Date of Agreement, to satisfy itself with regard to the physical aspects and size of the Property.

 

    
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(c)      
Hazardous Substance Conditions Report. Buyer has 45
days following the Date of Agreement, to satisfy itself with regard to the environmental aspects of the Property. Seller
recommends that Buyer obtain a Hazardous Substance Conditions Report concerning the Property and relevant adjoining properties.
Any such report shall be paid for by Buyer. A "Hazardous Substance" for purposes of this Agreement is defined
as any substance whose nature and/or quantity of existence, use, manufacture, disposal or effect, render it subject to Federal,
state or local regulation, investigation, remediation or removal as potentially injurious to public health or welfare. A "Hazardous
Substance Condition" for purposes of this Agreement is defined as the existence on, under or relevantly adjacent to the
Property of a Hazardous Substance that would require remediation and/or removal under applicable Federal, state or local law.

 

(d)     
Soil Inspection. Buyer has 45
days following the Date of Agreement, to satisfy itself with regard to the condition of the soils on the Property. Seller recommends
that Buyer obtain a soil test report. Any such report shall be paid for by Buyer. Seller shall provide Buyer copies of any soils
report that Seller may have within 10 days following the Date of Agreement.

 

(e)     
Governmental Approvals. Buyer has 45
days following the Date of Agreement to satisfy itself with regard to approvals and permits from governmental agencies
or departments which have or may have jurisdiction over the Property and which Buyer deems necessary or desirable in connection
with its intended use of the Property, including, but not limited to, permits and approvals required with respect to zoning, planning,
building and safety, fire, police, handicapped and Americans with Disabilities Act requirements, transportation and environmental
matters.

 

(f)      
Conditions of Title. Escrow Holder shall cause a current commitment for title insurance ("Title Commitment")
concerning the Property issued by the Title Company, as well as legible copies of all documents referred to in the Title Commitment
("Underlying Documents"), and a scaled and dimensioned plot showing the location of any easements to be delivered
to Buyer within 10 days following the Date of Agreement. Buyer has 10 days from the receipt of the Title Commitment, the Underlying
Documents and the plot plan to satisfy itself with regard to the condition of title. The disapproval by Buyer of any monetary
encumbrance, which by the terms of this Agreement is not to remain against the Property after the Closing, shall not be considered
a failure of this contingency, as Seller shall have the obligation, at Seller's expense, to satisfy and remove such disapproved
monetary encumbrance at or before the Closing.

 

(g)     
Survey. Buyer has 30 days following the receipt of the Title Commitment and Underlying Documents to satisfy itself
with regard to any ALTA title supplement based upon a survey prepared to American Land Title Association ("ALTA")
standards for an owner's policy by a licensed surveyor, showing the legal description and boundary lines of the Property, any
easements of record, and any improvements, poles, structures and things located within 10 feet of either side of the Property
boundary lines. Any such survey shall be prepared at Buyer's direction and expense. If Buyer has obtained a survey and approved
the ALTA title supplement, Buyer may elect within the period allowed for Buyer's approval of a survey to have an ALTA extended
coverage owner's form of title policy, in which event Buyer shall pay any additional premium attributable thereto.

 

(h)     
Intentionally omitted.

 

(i)      
Owner's Association. Seller shall within 10 days following the Date of Agreement provide Buyer with a statement
and transfer package from any owner's association servicing the Property. Such transfer package shall at a minimum include: copies
of the association's bylaws, articles of incorporation, current budget and financial statement. Buyer has 10 days from the
receipt of such documents to satisfy itself with regard to the association.

 

(j)      
Other Agreements. Seller shall within 10 days following the Date of Agreement provide Buyer with legible copies
of all other agreements ("Other Agreements") known to Seller that will affect the Property after Closing.
Buyer has 10 days from the receipt of said Other Agreements to satisfy itself with regard to such Agreements.

 

 (k)      Financing. If paragraph 5 hereof dealing with a financing contingency has not been stricken, the satisfaction or waiver of such New Loan contingency.

 

 (l)       Intentionally omitted.

 

(m)    
Personal Property. In the event that any personal property is included in the Purchase Price, Buyer has 10 days
following the Date of Agreement to satisfy itself with regard to the title condition of such personal property. Seller recommends
that Buyer obtain a UCC-1 report. Any such report shall be paid for by Buyer. Seller shall provide Buyer copies of any liens or
encumbrances affecting such personal property that it is aware of within 10 days following the Date of Agreement.

 

(n)     
Destruction, Damage or Loss. Subsequent to the Date of Agreement and prior to Closing there shall not have occurred
a destruction of, or damage or loss to, the Property or any portion thereof, from any cause whatsoever, which would cost more
than $10,000.00 to repair or cure. If the cost of repair or cure is $10,000.00 or less, Seller shall repair or cure the loss prior
to the Closing. Buyer shall have the option, within 10 days after receipt of written notice of a loss costing more than $10,000.00
to repair or cure, to either terminate this Agreement or to purchase the Property notwithstanding such loss, but without deduction
or offset against the Purchase Price. If the cost to repair or cure is more than $10,000.00, and Buyer does not elect to
terminate this Agreement, Buyer shall be entitled to any insurance proceeds applicable to such loss. Unless otherwise notified
in writing, Escrow Holder shall assume no such destruction, damage or loss has occurred prior to Closing.

 

(o)     
Material Change. Buyer shall have 10 days following receipt of written notice of a Material Change within which
to satisfy itself with regard to such change. "Material Change" shall mean a substantial adverse change in the
use, occupancy, tenants, title, or condition of the Property that occurs after the date of this offer and prior to the Closing.
Unless otherwise notified in writing, Escrow Holder shall assume that no Material Change has occurred prior to the Closing.

  

(p)     
Seller Performance. The delivery of all documents and the due performance by Seller of each and every undertaking
and agreement to be performed by Seller under this Agreement.

 

(q)     
Brokerage Fee. Payment at the Closing of such brokerage fee as is specified in this Agreement or later written
instructions to Escrow Holder executed by Seller and Brokers ("Brokerage Fee"). It is agreed by the Parties and
Escrow Holder that Brokers are a third party beneficiary of this Agreement insofar as the Brokerage Fee is concerned, and
that no change shall be made with respect to the payment of the Brokerage Fee specified in this Agreement, without the written
consent of Brokers.

 

9.2  
All of the contingencies specified in subparagraphs (a) through (m) of paragraph 9.1 are for the benefit of,
and may be waived by, Buyer, and may be elsewhere herein referred to as "Buyer's Contingencies."

 

9.3  
If any of Buyer's Contingencies or any other matter subject to Buyer's approval is disapproved as provided for herein in
a timely manner ("Disapproved Item"), Seller shall have the right within 10 days following the receipt of notice
of Buyer's disapproval to elect to cure such Disapproved Item prior to the Expected Closing Date ("Seller's Election").
Seller's failure to give to Buyer within such period, written notice of Seller's commitment to cure such Disapproved Item on or
before the Expected Closing Date shall be conclusively presumed to be Seller's Election not to cure such Disapproved Item. If
Seller elects, either by written notice or failure to give written notice, not to cure a Disapproved Item, Buyer shall have the
right, within 10 days after Seller's Election to either accept title to the Property subject to such Disapproved Item, or to terminate
this Agreement. Buyer's failure to notify Seller in writing of Buyer's election to accept title to the Property subject to the
Disapproved Item without deduction or offset shall constitute Buyer's election to terminate this Agreement. The above time
periods only apply once for each Disapproved Item. Unless expressly provided otherwise herein, Seller's right to cure shall not
apply to the remediation of Hazardous Substance Conditions or to the Financing Contingency. Unless the Parties mutually instruct
otherwise, if the time periods for the satisfaction of contingencies or for Seller's and Buyer's elections would expire on a date
after the Expected Closing Date, the Expected Closing Date shall be deemed extended for 3 business days following the expiration
of: (a) the applicable contingency period(s), (b) the period within which the Seller may elect to cure the Disapproved Item, or
(c) if Seller elects not to cure, the period within which Buyer may elect to proceed with this transaction, whichever is later.

 

9.4  
The Parties acknowledge that extensive local, state and Federal legislation establish broad liability upon owners and/or
users of real property for the investigation and remediation of Hazardous Substances. The determination of the existence of a
Hazardous Substance Condition and the evaluation of the impact of such a condition are highly technical and beyond the expertise
of Brokers. The Parties acknowledge that they have been advised by Brokers to consult their own technical and legal experts with
respect to the possible presence of Hazardous Substances on the Property or adjoining properties, and Buyer and Seller are not
relying upon any investigation by or statement of Brokers with respect thereto. The Parties hereby assume all responsibility for
the impact of such Hazardous Substances upon their respective interests herein.

 

 10.  Documents and Other Items Required at or Before Closing.

 

10.1 
Five days prior to the Closing date Escrow Holder shall obtain an updated Title Commitment concerning the Property from
the Title Company and provide copies thereof to each of the Parties.

 

 10.2 Seller shall deliver to Escrow Holder in time for delivery to Buyer at the Closing:

 

(a)     
Grant or general warranty deed, duly executed and in recordable form, conveying fee title to the Property to Buyer.

 

(b)     
If applicable, the Beneficiary Statements concerning Existing Note(s).

 

(c)     
If applicable, the Existing Leases and Other Agreements together with duly executed assignments thereof by Seller and Buyer.
The assignment of Existing Leases shall be on the most recent Assignment and Assumption of Lessor's Interest in Lease form published
by the AIR or its equivalent.

 

(d)     
If applicable, Estoppel Certificates executed by Seller and/or the tenant(s) of the Property.

 

(e)     
An affidavit executed by Seller to the effect that Seller is not a "foreign person" within the meaning
of Internal Revenue Code Section 1445 or successor statutes. If Seller does not provide such affidavit in form reasonably
satisfactory to Buyer at least 3 business days prior to the Closing, Escrow Holder shall at the Closing deduct from Seller's proceeds
and remit to the Internal Revenue Service such sum as is required by applicable Federal law with respect to purchases from foreign
sellers.

 

    
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(f)      
If the Property is located in California, an affidavit executed by Seller to the effect that Seller is not a
''nonresident" within the meaning of California Revenue and Tax Code Section 18662 or successor statutes. If Seller does
not provide such affidavit in form reasonably satisfactory to Buyer at least 3 business days prior to the Closing, Escrow
Holder shall at the Closing deduct from Seller's proceeds and remit to the Franchise Tax Board such sum as is required by such
statute.

 

 (g)      If applicable, a bill of sale, duly executed, conveying title to any included personal property to Buyer.

 

(h)     
If the Seller is a corporation, a duly executed corporate resolution authorizing the execution of this Agreement and the
sale of the Property.

 

 

 10.3 Buyer shall deliver to Seller through Escrow:

 

(a)     
The cash portion of the Purchase Price and such additional sums as are required of Buyer under this Agreement shall be
deposited by Buyer with Escrow Holder, by federal funds wire transfer, or any other method acceptable to Escrow Holder in immediately
collectable funds, no later than 2:00 P.M. on the business day prior to the Expected Closing Date provided, however, that Buyer
shall not be required to deposit such monies into Escrow if at the time set for the deposit of such monies Seller is in default
or has indicated that it will not perform any of its obligations hereunder. Instead, in such circumstances in order to reserve
its rights to proceed Buyer need only provide Escrow with evidence establishing that the required monies were available.

 

(b)     
If a Purchase Money Note and Purchase Money Deed of Trust are called for by this Agreement, the duly executed originals
of those documents, the Purchase Money Deed of Trust being in recordable form, together with evidence of fire insurance
on the improvements in the amount of the full replacement cost naming Seller as a mortgage loss payee, and a real estate tax service
contract (at Buyer's expense), assuring Seller of notice of the status of payment of real property taxes during the life of the
Purchase Money Note.

 

(c)      
The Assignment and Assumption of Lessor's Interest in Lease form specified in paragraph 10.2(c) above, duly executed
by Buyer.

 

(d)     
Assumptions duly executed by Buyer of the obligations of Seller that accrue after Closing under any Other Agreements.

 

 (e)      If applicable, a written assumption duly executed by Buyer of the loan documents with respect to Existing Notes.

 

 (f)      If the Buyer is a corporation, a duly executed corporate resolution authorizing the execution of this Agreement and the purchase of the Property.

 

 

10.4 At Closing,
Escrow Holder shall cause to be issued to Buyer a standard coverage (or ALTA extended, if elected pursuant to 9.1(g)) owner's
form policy of title insurance effective as of the Closing, issued by the Title Company in the full amount of the Purchase
Price, insuring title to the Property vested in Buyer, subject only to the exceptions approved by Buyer. In the event there is
a Purchase Money Deed of Trust in this transaction, the policy of title insurance shall be a joint protection policy insuring
both Buyer and Seller.

 

IMPORTANT: IN A PURCHASE OR EXCHANGE
OF REAL PROPERTY, IT MAY BE ADVISABLE TO OBTAIN TITLE INSURANCE IN CONNECTION WITH THE CLOSE OF ESCROW SINCE THERE MAY BE PRIOR
RECORDED LIENS AND ENCUMBRANCES WHICH AFFECT YOUR INTEREST IN THE PROPERTY BEING ACQUIRED. A NEW POLICY OF TITLE INSURANCE SHOULD
BE OBTAINED IN ORDER TO ENSURE YOUR INTEREST IN THE PROPERTY THAT YOU ARE ACQUIRING.

 

 11.  Prorations and Adjustments.

 

11.1
Taxes. Applicable real property taxes and special assessment bonds shall be prorated through Escrow as of the date
of the Closing, based upon the latest tax bill available. The Parties agree to prorate as of the Closing any taxes assessed against
the Property by supplemental bill levied by reason of events occurring prior to the Closing. Payment of the prorated amount shall
be made promptly in cash upon receipt of a copy of any supplemental bill.

 

11.2 Insurance.
WARNING: Any insurance which Seller may have maintained will terminate on the Closing. Buyer is advised to obtain appropriate
insurance to cover the Property.

 

11.3 Rentals,
Interest and Expenses. Scheduled rentals, interest on Existing Notes, utilities, and operating expenses shall be prorated
as of the date of Closing. The Parties agree to promptly adjust between themselves outside of Escrow any rents received after
the Closing.

 

 11.4 Security Deposit. Security Deposits held by Seller shall be given to Buyer as a credit to the cash required of Buyer at the Closing.

 

11.5
Post Closing Matters. Any item to be prorated that is not determined or determinable at the Closing shall be promptly
adjusted by the Parties by appropriate cash payment outside of the Escrow when the amount due is determined.

 

11.6 Variations
in Existing Note Balances. In the event that Buyer is purchasing the Property subject to an Existing Deed of Trust(s), and
in the event that a Beneficiary Statement as to the applicable Existing Note(s) discloses that the unpaid principal balance of
such Existing Note(s) at the closing will be more or less than the amount set forth in paragraph 3.1(c) hereof ("Existing
Note Variation"), then the Purchase Money Note(s) shall be reduced or increased by an amount equal to such Existing Note
Variation. If there is to be no Purchase Money Note, the cash required at the Closing per paragraph 3.1(a) shall be reduced or
increased by the amount of such Existing Note Variation.

 

11.7 Variations
in New Loan Balance. In the event Buyer is obtaining a New Loan and the amount ultimately obtained exceeds the amount set
forth in paragraph 5.1, then the amount of the Purchase Money Note, if any, shall be reduced by the amount of such excess.

 

11.8 Owner's Association
Fees. Escrow Holder shall: (i) bring Seller's account with the association current and pay any delinquencies or transfer fees
from Seller's proceeds, and (ii) pay any up front fees required by the association from Buyer's funds.

 

 12.  Representations and Warranties of Seller and Disclaimers.

 

12.1
Seller's warranties and representations shall survive the Closing and delivery of the deed for a period of 3 years, and
any lawsuit or action based upon them must be commenced within such time period. Seller's warranties and representations are true,
material and relied upon by Buyer and Brokers in all respects. Seller hereby makes the following warranties and representations
to Buyer and Brokers:

 

(a)      
Authority of Seller. Seller is the owner of the Property and/or has the full right, power and authority to sell,
convey and transfer the Property to Buyer as provided herein, and to perform Seller's obligations hereunder.

 

(b)     
Maintenance During Escrow and Equipment Condition At Closing. Except as otherwise provided in paragraph 9.1(n) hereof,
Seller shall maintain the Property until the Closing in its present condition, ordinary wear and tear excepted.

 

(c)     
Hazardous Substances/Storage Tanks. Seller has no knowledge, except as otherwise disclosed to Buyer in writing,
of the existence or prior existence on the Property of any Hazardous Substance, nor of the existence or prior existence of any
above or below ground storage tank.

 

(d)     
Compliance. Seller has no knowledge of any aspect or condition of the Property which violates applicable laws, rules,
regulations, codes or covenants, conditions or restrictions, or of improvements or alterations made to the Property without a
permit where one was required, or of any unfulfilled order or directive of any applicable governmental agency or casualty
insurance company requiring any investigation, remediation, repair, maintenance or improvement be performed on the Property.

 

(e)     
Changes in Agreements. Prior to the Closing, Seller will not violate or modify any Existing Lease or Other Agreement,
or create any new leases or other agreements affecting the Property, without Buyer's written approval, which approval will
not be unreasonably withheld.

 

(f)      
Possessory Rights. Seller has no knowledge that anyone will, at the Closing, have any right to possession of the
Property, except as disclosed by this Agreement or otherwise in writing to Buyer.

 

 (g)     Mechanics' Liens. There are no unsatisfied mechanics' or materialmens' lien rights concerning the Property.

 

(h)     
Actions, Suits or Proceedings. Seller has no knowledge of any actions, suits or proceedings pending or threatened
before any commission, board, bureau, agency, arbitrator, court or tribunal that would affect the Property or the right
to occupy or utilize same.

 

(i)     
Notice of Changes. Seller will promptly notify Buyer and Brokers in writing of any Material Change (see paragraph
9.1(o)) affecting the Property that becomes known to Seller prior to the Closing.

 

(j)     
No Tenant Bankruptcy Proceedings. Seller has no notice or knowledge that any tenant of the Property is the subject
of a bankruptcy or insolvency proceeding.

 

 (k)     No Seller Bankruptcy Proceedings. Seller is not the subject of a bankruptcy, insolvency or probate proceeding.

 

(l)       
Personal Property. Seller has no knowledge that anyone will, at the Closing, have any right to possession of any
personal property included in the Purchase Price nor knowledge of any liens or encumbrances affecting such personal property,
except as disclosed by this Agreement or otherwise in writing to Buyer.

 

12.2 Buyer hereby
acknowledges that, except as otherwise stated in this Agreement, Buyer is purchasing the Property in its existing condition and
will, by the time called for herein, make or have waived all inspections of the Property Buyer believes are necessary to protect
its own interest in, and its contemplated use of, the Property. The Parties acknowledge that, except as otherwise stated in this
Agreement, no representations, inducements, promises, agreements, assurances, oral or written, concerning the Property, or any
aspect of the occupational safety and health laws, Hazardous Substance laws, or any other act, ordinance or law, have been made
by either Party or Brokers, or relied upon by either Party hereto.

 

12.3 In the event
that Buyer learns that a Seller representation or warranty might be untrue prior to the Closing, and Buyer elects to purchase
the Property anyway then, and in that event, Buyer waives any right that it may have to bring an action or proceeding against
Seller or Brokers regarding said representation or warranty.

 

12.4 Any environmental
reports, soils reports, surveys, and other similar documents which were prepared by third party consultants and provided to Buyer
by Seller or Seller's representatives, have been delivered as an accommodation to Buyer and without any representation or warranty
as to the sufficiency, accuracy, completeness, and/or validity of said documents, all of which Buyer relies on at its own risk.
Seller believes said documents to be accurate, but Buyer is advised to retain appropriate consultants to review said documents
and investigate the Property.

 

 13.  Possession.

  

Possession of the Property shall be given
to Buyer at the Closing subject to the rights of tenants under Existing Leases.

 

    
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 14.  Buyer's Entry.

 

At any time during the Escrow period, Buyer,
and its agents and representatives, shall have the right at reasonable times and subject to rights of tenants, to enter upon the
Property for the purpose of making inspections and tests specified in this Agreement. No destructive testing shall be conducted,
however, without Seller's prior approval which shall not be unreasonably withheld. Following any such entry or work, unless otherwise
directed in writing by Seller, Buyer shall return the Property to the condition it was in prior to such entry or work, including
the re-compaction or removal of any disrupted soil or material as Seller may reasonably direct. All such inspections and tests
and any other work conducted or materials furnished with respect to the Property by or for Buyer shall be paid for by Buyer as
and when due and Buyer shall indemnify, defend, protect and hold harmless Seller and the Property of and from any and all claims,
liabilities, losses, expenses (including reasonable attorneys' fees), damages, including those for injury to person or property,
arising out of or relating to any such work or materials or the acts or omissions of Buyer, its agents or employees in connection
therewith.

 

 15.  Further Documents and Assurances.

 

The Parties shall each, diligently and in
good faith, undertake all actions and procedures reasonably required to place the Escrow in condition for Closing as and when
required by this Agreement. The Parties agree to provide all further information, and to execute and deliver all further documents,
reasonably required by Escrow Holder or the Title Company.

 

 16.  Attorneys' Fees.

 

If any Party or Broker brings an action or
proceeding (including arbitration) involving the Property whether founded in tort, contract or equity, or to declare rights hereunder,
the Prevailing Party (as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to reasonable
attorneys' fees and costs. Such fees may be awarded in the same suit or recovered in a separate suit, whether or not such action
or proceeding is pursued to decision or judgment. The term "Prevailing Party" shall include, without limitation,
a Party or Broker who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement,
judgment, or the abandonment by the other Party or Broker of its claim or defense. The attorneys' fees award shall not be computed
in accordance with any court fee schedule, but shall be such as to fully reimburse all attorneys' fees reasonably incurred.

 

 17.  Prior Agreements/Amendments.

 

 17.1 This Agreement supersedes any and all prior agreements between Seller and Buyer regarding the Property.

 

 17.2 Amendments to this Agreement are effective only if made in writing and executed by Buyer and Seller.

 

 18.  Broker's Rights.

 

18.1  
If this sale is not consummated due to the default of either the Buyer or Seller, the defaulting Party shall be liable
to and shall pay to Brokers the Brokerage Fee that Brokers would have received had the sale been consummated. If Buyer is the
defaulting party, payment of said Brokerage Fee is in addition to any obligation with respect to liquidated or other damages.

 

18.2  
Upon the Closing, Brokers are authorized to publicize the facts of this transaction.

 

 19.  Notices.

 

19.1  
Whenever any Party, Escrow Holder or Brokers herein shall desire to give or serve any notice, demand, request, approval,
disapproval or other communication, each such communication shall be in writing and shall be delivered personally, by messenger,
or by mail, postage prepaid, to the address set forth in this agreement or by facsimile transmission, electronic signature, digital
signature, or email.

 

19.2  
Service of any such communication shall be deemed made on the date of actual receipt if personally delivered, or transmitted
by facsimile transmission, electronic signature, digital signature, or email. Any such communication sent by regular mail shall
be deemed given 48 hours after the same is mailed. Communications sent by United States Express Mail or overnight courier that
guarantee next day delivery shall be deemed delivered 24 hours after delivery of the same to the Postal Service or courier. If
such communication is received on a Saturday, Sunday or legal holiday, it shall be deemed received on the next business day.

 

19.3  
Any Party or Broker hereto may from time to time, by notice in writing, designate a different address to which, or
a different person or additional persons to whom, all communications are thereafter to be made.

 

 20. Duration of Offer.

 

20.1  
If this offer is not accepted by Seller on or before 5:00 P.M. according to the time standard applicable to the city
of Anaheim, CA on the date of Friday,
September 20, 2019, it shall be deemed automatically revoked.

  

20.2 The acceptance of this offer,
or of any subsequent counteroffer hereto, that creates an agreement between the Parties as described in paragraph 1.2, shall
be deemed made upon delivery to the other Party or either Broker herein of a duly executed writing unconditionally accepting the
last outstanding offer or counteroffer.

 

 21. LIQUIDATED DAMAGES. (This Liquidated Damages paragraph is applicable only if initialed by both Parties).

THE PARTIES
AGREE THAT IT WOULD BE IMPRACTICABLE OR EXTREMELY DIFFICULT TO FIX, PRIOR TO SIGNING THIS AGREEMENT, THE ACTUAL DAMAGES WHICH
WOULD BE SUFFERED BY SELLER IF BUYER FAILS TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT. THEREFORE, IF, AFTER THE SATISFACTION
OR WAIVER OF ALL CONTINGENCIES PROVIDED FOR THE BUYER'S BENEFIT, BUYER BREACHES THIS AGREEMENT, SELLER SHALL BE ENTITLED TO LIQUIDATED
DAMAGES IN THE AMOUNT OF $150,000.00. UPON
PAYMENT OF SAID SUM TO SELLER, BUYER SHALL BE RELEASED FROM ANY FURTHER LIABILITY TO SELLER, AND ANY ESCROW CANCELLATION FEES
AND TITLE COMPANY CHARGES SHALL BE PAID BY SELLER.

 

	 	SA	 	DW	 
	 	Buyer’s Initials	 	Seller’s Initials	 

   

 22. ARBITRATION OF DISPUTES. (This Arbitration of Disputes paragraph is applicable only if initialed by both Parties.)

 

22.1  
ANY CONTROVERSY AS TO WHETHER SELLER IS ENTITLED TO THE LIQUIDATED DAMAGES AND/OR BUYER IS ENTITLED TO THE RETURN OF DEPOSIT
MONEY, SHALL BE DETERMINED BY BINDING ARBITRATION BY, AND UNDER THE COMMERCIAL RULES OF THE AMERICAN ARBITRATION ASSOCIATION ("COMMERCIAL
RULES"). ARBITRATION HEARINGS SHALL BE HELD IN THE COUNTY WHERE THE PROPERTY IS LOCATED. THE NUMBER OF ARBITRATORS SHALL
BE AS PROVIDED IN THE COMMERCIAL RULES AND EACH SUCH ARBITRATOR SHALL BE AN IMPARTIAL REAL ESTATE BROKER WITH AT LEAST 5 YEARS
OF FULL TIME EXPERIENCE IN BOTH THE AREA WHERE THE PROPERTY IS LOCATED AND THE TYPE OF REAL ESTATE THAT IS THE SUBJECT OF THIS
AGREEMENT. THE ARBITRATOR OR ARBITRATORS SHALL BE APPOINTED UNDER THE COMMERCIAL RULES AND SHALL HEAR AND DETERMINE SAID CONTROVERSY
IN ACCORDANCE WITH APPLICABLE LAW, THE INTENTION OF THE PARTIES AS EXPRESSED IN THIS AGREEMENT AND ANY AMENDMENTS THERETO, AND
UPON THE EVIDENCE PRODUCED AT AN ARBITRATION HEARING. PRE-ARBITRATION DISCOVERY SHALL BE PERMITTED IN ACCORDANCE WITH THE COMMERCIAL
RULES OR STATE LAW APPLICABLE TO ARBITRATION PROCEEDINGS. THE AWARD SHALL BE EXECUTED BY AT LEAST 2 OF THE 3 ARBITRATORS, BE RENDERED
WITHIN 30 DAYS AFTER THE CONCLUSION OF THE HEARING, AND MAY INCLUDE ATTORNEYS' FEES AND COSTS TO THE PREVAILING PARTY PER PARAGRAPH
16 HEREOF. JUDGMENT MAY BE ENTERED ON THE AWARD IN ANY COURT OF COMPETENT JURISDICTION NOTWITHSTANDING THE FAILURE OF A PARTY
DULY NOTIFIED OF THE ARBITRATION HEARING TO APPEAR THEREAT.

 

22.2  
BUYER'S RESORT TO OR PARTICIPATION IN SUCH ARBITRATION PROCEEDINGS SHALL NOT BAR SUIT IN A COURT OF COMPETENT JURISDICTION
BY THE BUYER FOR DAMAGES AND/OR SPECIFIC PERFORMANCE UNLESS AND UNTIL THE ARBITRATION RESULTS IN AN AWARD TO THE SELLER OF LIQUIDATED
DAMAGES, IN WHICH EVENT SUCH AWARD SHALL ACT AS A BAR AGAINST ANY ACTION BY BUYER FOR DAMAGES AND/OR SPECIFIC PERFORMANCE.

 

22.3  
NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE
"ARBITRATION OF DISPUTES" PROVISION DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING
UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY INITIALING IN THE SPACE BELOW YOU ARE
GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS SUCH RIGHTS ARE SPECIFICALLY INCLUDED IN THE "ARBITRATION
OF DISPUTES" PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO
ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.

 

WE HAVE READ AND
UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF DISPUTES"
PROVISION TO NEUTRAL ARBITRATION.

 

	 	SA	 	DW	 
	 	Buyer’s Initials	 	Seller’s Initials	 

  

 23.  Miscellaneous.

 

23.1  
Binding Effect. This Agreement shall be binding on the Parties without regard to whether or not paragraphs
21 and 22 are initialed by both of the Parties. Paragraphs 21 and 22 are each incorporated into this Agreement only if initialed
by both Parties at the time that the Agreement is executed. Signatures to this Agreement accomplished by means of electronic signature
or similar technology shall be legal and binding.

 

    
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23.2  Applicable
Law. This Agreement shall be governed by, and paragraph 22.3 is amended to refer to, the laws of the state in which the Property
is located. Any litigation or arbitration between the Parties hereto concerning this Agreement shall be initiated in the county
in which the Property is located.

 

23.3  Time
of Essence. Time is of the essence of this Agreement.

 

23.4  Counterparts.
This Agreement may be executed by Buyer and Seller in counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument. Escrow Holder, after verifying that the counterparts are identical except
for the signatures, is authorized and instructed to combine the signed signature pages on one of the counterparts, which shall
then constitute the Agreement.

 

23.5  Waiver
of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO TRIAL BY JURY IN ANY
ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT OF THIS AGREEMENT.

 

23.6  Conflict.
Any conflict between the printed provisions of this Agreement and the typewritten or handwritten provisions shall be controlled
by the typewritten or handwritten provisions. Seller and Buyer must initial any and all handwritten provisions.

 

23.7  1031
Exchange. Both Seller and Buyer agree to cooperate with each other in the event that either or both wish to participate in
a 1031 exchange. Any party initiating an exchange shall bear all costs of such exchange. The cooperating Party shall not have
any liability (special or otherwise) for damages to the exchanging Party in the event that the sale is delayed and/or that the
sale otherwise fails to qualify as a 1031 exchange.

 

23.8  Days.
Unless otherwise specifically indicated to the contrary, the word "days" as used in this Agreement shall mean and refer
to calendar days.

 

24.  Disclosures
Regarding the Nature of a Real Estate Agency Relationship.

 

24.1  The
Parties and Brokers agree that their relationship(s) shall be governed by the principles set forth in the applicable sections
of the California Civil Code, as summarized in paragraph 24.2.

 

24.2  When
entering into a discussion with a real estate agent regarding a real estate transaction, a Buyer or Seller should from the outset
understand what type of agency relationship or representation it has with the agent or agents in the transaction. Buyer and Seller
acknowledge being advised by the Brokers in this transaction, as follows:

 

(a)     Seller's
Agent. A Seller's agent under a listing agreement with the Seller acts as the agent for the Seller only. A Seller's agent
or subagent has the following affirmative obligations: (1) To the Seller: A fiduciary duty of utmost care, integrity, honesty,
and loyalty in dealings with the Seller. (2) To the Buyer and the Seller: a. Diligent exercise of reasonable skills and
care in performance of the agent's duties. b. A duty of honest and fair dealing and good faith. c. A duty to disclose all facts
known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent
attention and observation of, the Parties. An agent is not obligated to reveal to either Party any confidential information obtained
from the other Party which does not involve the affirmative duties set forth above.

 

(b)     Buyer's
Agent. A selling agent can, with a Buyer's consent, agree to act as agent for the Buyer only. In these situations, the
agent is not the Seller's agent, even if by agreement the agent may receive compensation for services rendered, either in full
or in part from the Seller. An agent acting only for a Buyer has the following affirmative obligations. (1) To the Buyer:
A fiduciary duty of utmost care, integrity, honesty, and loyalty in dealings with the Buyer. (2) To the Buyer and the Seller:
a. Diligent exercise of reasonable skills and care in performance of the agent's duties. b. A duty of honest and fair dealing
and good faith. c. A duty to disclose all facts known to the agent materially affecting the value or desirability of the property
that are not known to, or within the diligent attention and observation of, the Parties. An agent is not obligated to reveal to
either Party any confidential information obtained from the other Party which does not involve the affirmative duties set forth
above.

 

(c)     Agent
Representing Both Seller and Buyer. A real estate agent, either acting directly or through one or more associate licenses,
can legally be the agent of both the Seller and the Buyer in a transaction, but only with the knowledge and consent of both the
Seller and the Buyer. (1) In a dual agency situation, the agent has the following affirmative obligations to both the Seller and
the Buyer: a. A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either Seller or the Buyer.
b. Other duties to the Seller and the Buyer as stated above in their respective sections (a) or (b) of this paragraph 24.2. (2)
In representing both Seller and Buyer, the agent may not, without the express permission of the respective Party, disclose to
the other Party confidential information, including, but not limited to, facts relating to either Buyer’s or Seller’s
financial position, motivations, bargaining position, or other personal information that may impact price, including Seller's
willingness to accept a price less than the listing price or Buyer's willingness to pay a price greater than the price offered.
(3) The above duties of the agent in a real estate transaction do not relieve a Seller or Buyer from the responsibility to protect
their own interests. Buyer and Seller should carefully read all agreements to assure that they adequately express their understanding
of the transaction. A real estate agent is a person qualified to advise about real estate. If legal or tax advice is desired,
consult a competent professional. Buyer has the duty to exercise reasonable care to protect Buyer, including as to those facts
about the Property which are known to Buyer or within Buyer’s diligent attention and observation. Both Seller and Buyer
should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of
a transaction can be complex and subject to change.

 

(d)     Further
Disclosures. Throughout this transaction Buyer and Seller may receive more than one disclosure, depending upon the number
of agents assisting in the transaction. Buyer and Seller should each read its contents each time it is presented, considering
the relationship between them and the real estate agent in this transaction and that disclosure. Buyer and Seller each acknowledge
receipt of a disclosure of the possibility of multiple representation by the Broker representing that principal. This disclosure
may be part of a listing agreement, buyer representation agreement or separate document. Buyer understands that Broker representing
Buyer may also represent other potential buyers, who may consider, make offers on or ultimately acquire the Property. Seller understands
that Broker representing Seller may also represent other sellers with competing properties that may be of interest to this Buyer.
Brokers have no responsibility with respect to any default or breach hereof by either Party. The Parties agree that no lawsuit
or other legal proceeding involving any breach of duty, error or omission relating to this transaction may be brought against
Broker more than one year after the Date of Agreement and that the liability (including court costs and attorneys' fees), of any
Broker with respect to any breach of duty, error or omission relating to this Agreement shall not exceed the fee received by such
Broker pursuant to this Agreement; provided, however, that the foregoing limitation on each Broker's liability shall not be applicable
to any gross negligence or willful misconduct of such Broker.

 

24.3  Confidential
Information. Buyer and Seller agree to identify to Brokers as "Confidential" any communication or information given
Brokers that is considered by such Party to be confidential.

 

25.  Construction
of Agreement. In construing this Agreement, all headings and titles are for the convenience of the Parties only and shall
not be considered a part of this Agreement. Whenever required by the context, the singular shall include the plural and vice versa.
This Agreement shall not be construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole,
as if both Parties had prepared it.

 

26.  Additional
Provisions.

 

Additional provisions of this offer,
if any, are as follows consisting of paragraphs 25.1 through 25.1.

 

26.1  Buyer
will leaseback the premises to Seller following Close of Escrow, through January 31, 2020 at a rate of $30,000.00 per month on
a gross basis. The A.I.R. Single Tenant Gross Lease form shall be used.

 

	ATTENTION:
        NO REPRESENTATION OR RECOMMENDATION IS MADE BY AIR CRE OR BY ANY BROKER AS TO
        THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS AGREEMENT OR THE TRANSACTION TO WHICH IT RELATES. THE
        PARTIES ARE URGED TO:

        1.       SEEK
        ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS AGREEMENT.

        2.       RETAIN
        APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF THE PROPERTY. SAID INVESTIGATION SHOULD INCLUDE BUT
        NOT BE LIMITED TO: THE POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PROPERTY, THE INTEGRITY AND CONDITION
        OF ANY STRUCTURES AND OPERATING SYSTEMS, AND THE SUITABILITY OF THE PROPERTY FOR BUYER'S INTENDED USE.

         

        WARNING:
        IF THE PROPERTY IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN PROVISIONS
        OF THIS AGREEMENT MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE STATE IN WHICH THE PROPERTY IS LOCATED.

 

    
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NOTE:

1.     THIS
FORM IS NOT FOR USE IN CONNECTION WITH THE SALE OF RESIDENTIAL PROPERTY.

2.     IF
EITHER PARTY IS A CORPORATION, IT IS RECOMMENDED THAT THIS AGREEMENT BE SIGNED BY TWO CORPORATE OFFICERS.

 

The undersigned Buyer offers and
agrees to buy the Property on the terms and conditions stated and acknowledges receipt of a copy hereof.

 

	 	 	Date:   9/19/19
	 	 	 
	BROKER	 	BUYER
	 	 	 
	Bryan Industrial Properties,
    Inc. & Newmark Knight Frank	 	Charles S. Alemi
    or assignee
	 	 	 
	Attn:   John
    Maresca & Troy Williams	 	By:	/S/
    S. ALEMI
	Title:                                                                             	 	Name Printed:   Charles
    S. Alemi
	 	 	Title:   Managing
    Partner
	Address:   146
    E. Orangethorpe Ave.,	 	Phone:   714-615-3135
	Anaheim,
    CA 92801	 	Fax:                         
	Phone:   (714)
    871-1314	 	Email:   Charlie.alemi@costsign.com
	Fax:                         	 	 
	Email:                         	 	By:	 
	Federal ID No.:                         	 	 
	Broker DRE License #:   00002442
    (Bryan Industrial) & 01355491 (Newmark Knight Frank)	 	Name Printed:                         
	Agent DRE License #:   00896979
    (JM) & 01053444 (TW)	 	Title:                         
		 	Phone:                         
	 	 	Fax:                         
	 	 	Email:                         
	 	 	 
	 	 	Address:                         
	 	 	Federal ID No.:   TBD

 

    
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27.  Acceptance.

 

27.1  Seller
accepts the foregoing offer to purchase the Property and hereby agrees to sell the Property to Buyer on the terms and conditions
therein specified.

 

27.2  In
consideration of real estate brokerage service rendered by Brokers, Seller agrees to pay Brokers a real estate Brokerage Fee in
a sum equal to $318,375.00 to be divided between the Brokers as follows: Seller's Broker 50% and Buyer's Broker
50%. This Agreement shall serve as an irrevocable instruction to Escrow Holder to pay such Brokerage Fee to Brokers out
of the proceeds accruing to the account of Seller at the Closing.

 

27.3  Seller
acknowledges receipt of a copy hereof and authorizes Brokers to deliver a signed copy to Buyer.

 

NOTE: A PROPERTY INFORMATION
SHEET IS REQUIRED TO BE DELIVERED TO BUYER BY SELLER UNDER THIS AGREEMENT.

 

	 	 	Date:   9/18/19
	 	 	 
	BROKER	 	SELLER
	 	 	 
	Ashwill Associates Commercial
    Real Estate	 	Bisco Industries,
    Inc.
	 	 	 
	Attn:   Steve
    Bryant	 	By:	/S/
    DON WAGNER
	Title:   Senior
    Vice President	 	Name Printed:   Don
    Wagner
	 	 	Title:   President
    and COO
	Address:   2100
    W. Orangewood Ave., Suite 110, Orange, CA 92868	 	Phone:   714-693-2904
	Phone:   (714)
    919-3530	 	Fax:                         
	Fax:   (714)
    456-9009	 	Email:  dwagner@biscoind.com
	Email:   stevebryant@ashwillassociates.com	 	 
	Federal ID No.:                         	 	By:	 
	Broker DRE License #:   01291393	 	 
	Agent's DRE License #:   00560937	 	Name Printed:                         
	 	 	Title:                         
	 	 	Phone:                         
	 	 	Fax:                         
	 	 	Email:                         
	 	 	 
	 	 	Address:                         
	 	 	Federal ID No.:                         

 

AIR
CRE * https://www.aircre.com * 213-687-8777 * contracts@aircre.com

NOTICE:
No part of these works may be reproduced in any form without permission in writing.

 

    
	      SA      	     DW     
	INITIALS	INITIALS

 
	© 2019 AIR CRE. All rights reserved.	Last edited: 09/17/19 1:37 p.m.
	OFA-20.12. Revised 06-10-2019	Page 8 of 8Exhibit 4.1

 

Stock
Option Plan

 

		1	PURPOSE OF PLAN

 

		1.1	The purpose of the Plan is to assist directors, officers, key employees, consultants and members
of the Scientific Advisory Board (if any) of the Corporate Group to participate in the growth and development of the Corporate
Group by providing such persons with the opportunity, through share options, to acquire an increased proprietary interest in the
Corporation.

 

		2	DEFINED TERMS

 

Where used herein, the following terms
shall have the following meanings, respectively:

 

		2.1	“Affiliate” shall mean any Entity in an unbroken chain of Entities beginning
with the Corporation if, at the time of granting of the option, each of the Entities other than the last Entity in the unbroken
chain own stock or other comparable equity interest to which are attached more than 50% of the aggregate number of votes attached
to the outstanding shares of all classes of stock or other comparable equity interest in the Entity directly below that Entity
in such chain;

 

		2.2	“Blackout Period” means a period when the Optionee is prohibited from trading
in the Corporation’s securities pursuant to a blackout period established by the Corporation;

 

		2.3	“Board” means the board of directors of the Corporation or, if established and
duly authorized to act, the Executive Committee of the board of directors of the Corporation;

 

		2.4	“Business Day” means any day, other than a Saturday or a Sunday;

 

		2.5	“Committee” shall have the meaning attributed thereto in Section 3;

 

		2.6	“Corporate Group” means the Corporation and its Affiliates, present and future,
so long as such Entity remains an Affiliate;

 

		2.7	“Corporation” means Bellus Health Inc. and includes any successor corporation
thereto;

 

		2.8	“Designated Exchange” shall mean the Toronto Stock Exchange or such other stock
exchange as may be designated from time to time by the Board;

 

		2.9	“Dividends Paid in the Ordinary Course” means such dividends paid in cash on
the Shares in any fiscal year of the Corporation to the extent that such dividends in the aggregate do not exceed in amount or
value the greatest of: (a) 110% of the aggregate amount or value of the dividends paid by the Corporation on its Shares
in the 12 consecutive months ended immediately prior to the first day of such fiscal year; (b) 25% of the consolidated net
earnings of the Corporation before extraordinary items and after dividends paid on any and all preferred shares of the Corporation
for the most recently completed fiscal year; and (c) 10% of the aggregate of all classes of share capital, other paid-in-capital,
retained earnings/deficit and any and all surplus accounts and reserves as shown on the audited financial statements of the Corporation
for the most recently ended fiscal year;

 

     

    	 	- 2 -
	 

    

 

		2.10	“Eligible Person” means any director, officer, full time employee, consultant
or member of the Scientific Advisory Board of the Corporate Group;

 

		2.11	“Entity” means any corporation, company, partnership, trust, limited liability
company, foundation, and/or firm;

 

		2.12	“Grant Date” means the date at which an Option is granted to an Optionee;

 

		2.13	“Market Price” means the volume weighted average trading price for the Shares
for the five days preceding the date of grant during which the Shares were traded on the Designated Exchange;

 

		2.14	“Option” means an option to purchase Shares granted under the Plan;

 

		2.15	“Option Price” means the price per share at which Shares may be purchased under
the Option, as the same may be adjusted from time to time in accordance with Section 9;

 

		2.16	“Optionee” means a person to whom an Option has been granted;

 

		2.17	“Plan” means the BELLUS Health Inc. Stock Option Plan, as amended herein, as
the same may be amended or varied from time to time;

 

		2.18	“Shares” means the Common Shares of the Corporation, or, in the event of an
adjustment contemplated by Section 8, such other shares or securities to which an Optionee may be entitled upon the exercise of
an Option as a result of such adjustment; and

 

		2.19	“Trading Day”, with respect to any stock exchange or over the counter market,
means a day on which shares may be traded through the facilities of such stock exchange or in such over the counter market.

 

		3	ADMINISTRATION OF THE PLAN

 

		3.1	The Plan shall be administered by a committee (the “Committee”) appointed by
the Board and consisting of not less than three members of the Board. The members of the Committee shall serve at the pleasure
of the Board and vacancies occurring in the Committee shall be filled by the Board.

 

		3.2	The Committee shall elect one of its members as its Chairman and shall hold its meetings at such
time and place, as it shall deem advisable. A majority of the members of the Committee shall constitute a quorum and all actions
of the Committee shall be taken by a majority of the members present at any meeting. Any action of the Committee may be taken by
an instrument or instruments in writing signed by all the members of the Committee, and any action shall be as effective as if
it had been passed by a majority of the votes cast by the members of the Committee present at a meeting of such members duly called
and held.

 

     

    	 	- 3 -
	 

    

 

		3.3	The Committee shall have, where consistent with the general purpose and intent of the Plan and
subject to the specific provisions of the Plan (including approval of the Board pursuant to Section 5 hereof), the power to:

 

		3.3.1	establish policies and to adopt rules and regulations for carrying out the purposes, provisions
and administration of the Plan;

 

		3.3.2	interpret and construe the Plan and to determine all questions arising out of the Plan and any
Option granted pursuant to the Plan, and any such interpretation, construction or termination made by the Committee shall be final,
binding and conclusive for all purposes;

 

		3.3.3	determine to which Eligible Persons Options are granted and to grant Options;

 

		3.3.4	determine the number of Shares covered by each Option;

 

		3.3.5	determine the time or times when Options will be granted and exercisable;

 

		3.3.6	determine if the Shares that are subject to an Option will be subject to any restrictions upon
the exercise of such Option; and

 

		3.3.7	prescribe the form of the instruments relating to the grant, exercise and other terms of Options.

 

		4	SHARES SUBJECT TO PLAN

 

		4.1	Options may be granted in respect of authorized and unissued
Shares, provided that the aggregate number of Shares of all classes reserved for issuance under this Plan, subject to adjustment
or increase of such number pursuant to the provisions of Section 9, together with any Shares reserved for issuance under any options
for services or employee stock purchase or stock option plans or any other plans, shall not exceed 12.5% of the total number of
Shares issued and outstanding from time to time and also provided that:

 

		4.1.1	the aggregate number of Shares reserved for issuance at any time to any one optionee shall not
exceed 5% of the number of Shares of the Corporation outstanding on a non-diluted basis at such time, less the total of all shares
reserved for issuance to such optionee pursuant to any other share compensation arrangement of the Corporate Group;

 

		4.1.2	the aggregate number of Shares issuable (or, reserved for issuance) to insiders of the Corporate
Group under the Plan and any other share compensation arrangement of the Corporate Group, cannot at any time exceed 10% of the
issued and outstanding Shares of the Corporation; and

 

		4.1.3	the aggregate number of Shares issued to insiders under the Plan and any other share compensation
arrangement of the Corporate Group, within a one year period, cannot exceed 10% of the issued and outstanding Shares of the Corporation.

 

     

    	 	- 4 -
	 

    

 

No fractional shares may be purchased
or issued under the Plan.

 

For the purposes of this Plan:
(i) the terms “insider” and “associate” shall have the respective meanings ascribed thereto in Sections
613 and following of the Toronto Stock Exchange Company Manual; (ii) the “outstanding issue” means the aggregate number
of Shares outstanding on a non-diluted basis immediately prior to the share issuance in question, and (iii) a “share compensation
arrangement” means a stock option, stock option plan, stock purchase plan or any other compensation or incentive mechanism
involving the issuance or potential issuance of shares to one or more employees or directors, including a share purchase from treasury
which is financially assisted by the Corporate Group by way of a loan, guarantee or otherwise.

 

		5	ELIGIBILITY, GRANT AND TERMS OF OPTIONS

 

		5.1	Options may be granted by the Corporation to Eligible Persons pursuant to recommendations of the
Committee provided and to the extent that such recommendations are approved by the Board.

 

		5.2	Subject as herein and as otherwise specifically provided for in this Section 5, the number of Shares
subject to each Option, the expiration date of each Option, the extent to which each Option is exercisable from time to time during
the term of the Option and other terms and conditions relating to each such Option shall be determined by the Committee and be
subject to approval by the Board, provided, however, that if no specific determination is made by the Committee with respect to
any of the following matters, each Option shall, subject to any other specific provisions of the Plan, contain the following terms
and conditions:

 

		5.2.1	the period during which an Option shall be exercisable shall be 10 years from the Grant Date; and

 

		5.2.2	the Optionee may take up and pay for not more than 20% of the Shares covered by the Option after
the expiration of each one year period in arrears from the Grant Date; provided, however, that if the number of Shares taken up
under the Option after the expiration of each one-year period is less than 20% of the Shares covered by the Option, the Optionee
shall have the right, on a cumulative basis, at any time or from time to time during the remainder of the term of the Option, to
purchase such number of Shares subject to the Option that were purchasable, but not purchased by him, after the expiration of each
such one-year period.

 

		5.3	The Option Price on Shares that are the subject of any Option shall in no circumstances be lower
than the Market Price at the date of the grant of the Option.

 

		5.4	An Option is personal to the Optionee and is non assignable.

 

		5.5	If the term of an Option held by any Eligible Person
expires during or within 10 Business Days of the expiration of a Blackout Period, then the term of such Option or the unexercised
portion thereof, shall be extended 10 Business Days after the expiration of the Blackout Period (the “Blackout Expiration
Term”).

 

     

    	 	- 5 -
	 

    

 

		6	TERMINATION OF EMPLOYMENT; DEATH

 

		6.1	Subject to Section 6.2 and to any express resolution passed by the Committee with respect to an
Option, an Option, and all rights to purchase Shares pursuant thereto, shall expire and terminate immediately upon the Optionee
ceasing to be a director, officer, full time employee, consultant or member of the Scientific Advisory Board of the Corporate Group.
For greater certainty, the Optionee shall not lose any rights to any Options granted pursuant to the Plan if he changes positions
within the Corporate Group so long as he remains an Eligible Person.

 

		6.2	If, before the expiry of an Option in accordance with the terms thereof, the employment of the
Optionee by the Corporate Group shall terminate for any reason whatsoever other than termination by the Corporate Group for cause,
but including termination by reason of the death of the Optionee, such Option may, subject to the terms thereof and any other terms
of the Plan, be exercised, if the Optionee is deceased, by the legal personal representative(s) of the estate of the Optionee during
the first three months following the death of the Optionee, or if he is alive, by the Optionee, at any time within three months
of the date of termination of the employment of the Optionee (but in either case prior to the expiry of the Option in accordance
with the terms thereof), but only to the extent that the Optionee was entitled to exercise such Option at the date of the termination
of his employment.

 

		6.3	Options shall not be affected by any change of employment of the Optionee or by the Optionee ceasing
to be a director where the Optionee continues to be employed on a full time basis by, or continues to be a director of any Entity
of the Corporate Group.

 

		7	EXERCISE OF OPTIONS

 

		7.1	Subject to the provisions of the Plan, an Option may be exercised from time to time by delivery
to the Corporation at its registered office of a written notice of exercise addressed to the Secretary of the Corporation specifying
the number of Shares with respect to which the option is being exercised and accompanied by payment in full of the Option Price
of the Shares to be purchased. Certificates for such Shares shall be issued and delivered to the Optionee within a reasonable time
following the receipt of such notice and payment.

 

		7.2	Notwithstanding any of the provisions contained in the Plan or in any Option, the Corporation’s
obligations to issue Shares to an Optionee pursuant to the exercise of an Option shall be subject to the receipt from the Optionee
of such representations, agreements and undertakings, including (a) as to future dealings in such Shares, as the Corporation or
its counsel determines to be necessary or advisable in order to safeguard against the violation of the securities laws of any jurisdiction;
and (b) completion of such registration or other qualification of such Shares or obtaining approval of such government authority
as the Corporation shall determine to be necessary or advisable in connection with the authorization, issuance or sale thereof.

 

     

    	 	- 6 -
	 

    

 

In this respect the Corporation
shall, to the extent necessary, take all reasonable steps to obtain such approvals, registrations and qualifications as may be
necessary for the issuance of such Shares in compliance with applicable securities laws and for the listing of such Shares on any
stock exchange on which the Shares are then listed.

 

		7.3	Notwithstanding any of the provisions contained in the Plan or in any Option, the Corporation may,
from time to time, implement such procedures and conditions as it determines appropriate with respect to the withholding and remittance
of taxes imposed under applicable law, or the funding of related amounts for which liability may arise under such applicable law.
Without limiting the generality of the foregoing, an Optionee who wishes to exercise an Option the Shares issuable in respect of
which are not to be sold on the Optionee’s behalf by the Corporation must, in addition to following the procedures set out
elsewhere in this Plan, and as a condition of exercise:

 

		7.3.1	deliver a certified cheque, wire transfer or bank draft payable to the Corporation for the amount
determined by the Corporation to be the appropriate amount on account of such taxes or related amounts; or

 

		7.3.2	otherwise ensure, in a manner acceptable to the Corporation (if at all) in its sole and unfettered
discretion, that the amount will be securely funded;

 

		7.3.3	and must in all other respects follow any related procedures and conditions imposed by the Corporation.

 

In the event of an exercise pursuant
to which Shares issuable to the Optionee are to be sold on the Optionee’s behalf, the Corporation shall deduct from any proceeds
payable to the Optionee any and all amounts necessary to satisfy the Corporation’s withholding and/or remittance obligations
under applicable law.

 

		8	ACCELERATED VESTING UPON ACQUISITION EVENT

 

		8.1	Notwithstanding any vesting period determined by the
Board in respect of any Option granted to an Optionee at any time, the Board may, upon written notice to all the Optionees, provide
that all or a portion of the then vested or unvested Options held by such Optionees will become exercisable in full as of a specified
time prior to the consummation of the Acquisition Event and that all or a portion of the Options (whether or not vested) will
terminate immediately prior to the consummation of such Acquisition Event, except to the extent exercised by the Optionees before
the consummation of such Acquisition Event; provided, however, that in the event of an Acquisition Event under the terms of which
holders of Shares will receive upon consummation thereof a cash payment for each Share surrendered pursuant to such Acquisition
Event (the “Acquisition Price”), then the Board may instead provide in such notice that all or a portion
of the outstanding vested or unvested (or both) Options shall terminate upon consummation of such Acquisition Event and that each
Optionee shall receive, in exchange therefore, a cash payment equal to the amount (if any) by which (A) the Acquisition
Price multiplied by the number of Shares subject to such outstanding Options (whether or not then vested), exceeds (B) the aggregate
exercise price of such Options. For the purposes hereof, “Acquisition Event” shall mean any transaction or
series of transactions after which a Person (or a related group of Persons) owns at least 50.1% of the common shares of the Corporation;
and “Person” shall mean any individual, corporation or company, partnership, joint venture, syndicate, sole
proprietorship, trust, trustee, executor, administrator or other legal representative or an unincorporated organization, government
or governmental authority or entity.

 

     

    	 	- 7 -
	 

    

 

		9	CERTAIN ADJUSTMENTS

 

		9.1	Subject to regulatory approval, the Option Price and
the number of Shares to which an Optionee may be entitled upon the exercise of an Option shall be subject to adjustment from time
to time upon the occurrence of any of the events and in the manner provided as follows:

 

		9.1.1	If and whenever the Corporation shall:

 

		(a)	issue Shares (or securities exchangeable for or convertible into Shares) to all or substantially
all of the holders of Shares as a stock dividend or other distribution;

 

		(b)	subdivide or change its outstanding Shares into a greater number of Shares; or

 

		(c)	reduce, combine or consolidate its outstanding Shares into a smaller number of Shares;

 

(any of such events, a “Share
Reorganization”), then effective immediately after the record date or effective date, as the case may be, at which the
holders of Shares are determined for the purposes of the Share Reorganization, the Option Price shall be adjusted to a price determined
by multiplying the applicable Option Price in effect on such effective date or record date by a fraction, the numerator of which
shall be the number of Shares outstanding on such effective date or record date before giving effect to such Share Reorganization
and the denominator of which shall be the number of Shares outstanding immediately after giving effect to such Share Reorganization
(including, in the case where securities exchangeable for or convertible into Shares are distributed, the number of additional
Shares that would have been outstanding had such securities been exchanged for or converted into Shares immediately after giving
effect to such Share Reorganization).

 

		9.1.2	If and whenever the Corporation shall fix a record date for the issuing of rights, options or warrants
to all or substantially all of the holders of the Shares entitling them for a period expiring not more than 45 days after such
record date (the “Rights Period”) to subscribe for or purchase Shares (or securities exchangeable for or convertible
into Shares) at a price per share (or having a conversion or exchange price per share) which is less than 95% of the Market Price
on the record date for such issue (any of such events, a “Rights Offering”), then effective immediately after
the end of the Rights Period the Option Price shall be adjusted to a price determined by multiplying the applicable Option Price
in effect at the end of the Rights Period by a fraction:

 

     

    	 	- 8 -
	 

    

 

		(a)	the numerator of which shall be the sum of:

 

		(i)	the number of Shares outstanding as of the record date for the Rights Offering; and

 

		(ii)	a number determined by dividing (1) the product of either (i) the number of Shares issued during
the Rights Period upon exercise of the rights, warrants or options under the Rights Offering and (ii) the price at which such Shares
are issued, or, as the case may be, (iii) the number of Shares for or into which the convertible or exchangeable securities issued
during the Rights Period upon exercise of the rights, warrants or options under the Rights Offering are exchangeable or convertible
and (iv) the exchange or conversion price of the convertible or exchangeable securities so issued, by (2) the Market Price as of
the record date for the Rights Offering; and

 

		(b)	the denominator of which shall be the number of Shares outstanding (including the number of Shares
actually issued or subscribed for during the Rights Period upon exercise of the rights, warrants or options under the Rights Offering)
or which would be outstanding upon the conversion or exchange of all convertible or exchangeable securities issued during the Rights
Period upon exercise of the rights, warrants or options under the Rights Offering, as applicable, in each case after giving effect
to the Rights Offering.

 

Any Optionee who shall have exercised
his right to purchase Shares during the period beginning immediately after the record date for a Rights Offering and ending on
the last day of the Rights Period therefor, in addition to the Shares to which he is otherwise entitled upon such exercise, shall
be entitled to that number of additional Shares equal to the result obtained when the difference, if any, between the Option Price
in effect immediately prior to the end of such Rights Offering and the Option Price, as adjusted for such Rights Offering pursuant
to this Section 9.1.2, is multiplied by the number of Shares purchased upon exercise of the Option held by such Optionee during
such period, and the resulting product is divided by the Option Price, as adjusted for such Rights Offering pursuant to this Section
9.1.2. Such additional Shares shall be deemed to have been issued to the Optionee immediately following the end of the Rights Period
and a certificate for such additional Shares shall be delivered to such Optionee within 10 Business Days following the end of the
Rights Period.

 

		9.1.3	If and whenever the Corporation shall fix a record date for the payment, issue or distribution
to all or substantially all of the holders of Shares of (i) a dividend, (ii) cash or assets (including evidences of the Corporation’s
indebtedness), or (iii) rights, options, warrants or other securities (including securities exchangeable for or convertible into
Shares), and such payment, issue or distribution does not constitute a Dividend Paid in the Ordinary Course, a Share Reorganization
or a Rights Offering (any of such non-excluded events being herein called a “Special Distribution”), the Option
Price shall be adjusted effective immediately after such record date to a price determined by subtracting from the applicable Option
Price in effect on such record date the quotient of:

 

     

    	 	- 9 -
	 

    

 

		(a)	the fair market value, as determined in good faith by action of the Board (whose determination
shall be conclusive), to the holders of Shares of such dividend, cash, assets, rights or securities so paid, issued or distributed
less the fair market value, as determined in good faith by action of the Board (whose determination shall be conclusive), of the
consideration, if any, received therefor by the Corporation; divided by

 

		(b)	the number of Shares outstanding on such record date.

 

Such adjustment shall be made successively
whenever such a record date is fixed. To the extent that such payment, issuance or distribution is not so made, the Option Price
shall be readjusted effective immediately to the Option Price which would then be in effect based upon such payment, issuance or
distribution actually made.

 

		9.1.4	If and whenever the Corporation or a subsidiary of the Corporation shall make an issuer bid (other
than a normal course issuer bid) to all or substantially all of the shareholders of the Corporation for all or any portion of the
Shares where the cash and the value of any other consideration included in such payment per Share exceeds the Market Price on the
Trading Day immediately preceding the commencement of the issuer bid or tender or exchange offer (any such issuer being called
an “Issuer Bid”), the Option Price shall be adjusted to a price determined by multiplying the applicable Option
Price in effect on the date of the completion of such Issuer Bid by a fraction:

 

		(a)	the numerator of which shall be the product of:

 

		(i)	the number of Shares outstanding immediately prior to the completion of the Issuer Bid (without
giving effect to any reduction in respect of any tendered or exchanged shares); and

  

		(ii)	the Market Price on the Trading Day immediately preceding the commencement of the Issuer Bid; and

 

		(b)	the denominator of which shall be the sum of:

 

		(i)	the fair market value (determined by the Board, acting reasonably, whose determination shall be
conclusive and described in a resolution of the Board) of the aggregate consideration paid by the Corporation or subsidiary to
holders of Shares upon the completion of such Issuer Bid; and

 

     

    	 	- 10 -
	 

    

 

		(ii)	the product of (i) the difference between the number of Shares outstanding immediately prior to
the completion of the Issuer Bid (without giving effect to any reduction in respect of tendered or exchanged shares) and the number
of Shares actually purchased by the Corporation or subsidiary pursuant to the Issuer Bid, and (ii) the Market Price on the Trading
Day immediately preceding the commencement of the Issuer Bid.

 

		9.1.5	If and whenever there shall be a reorganization, reclassification or other change of Shares outstanding
at such time or change of the Shares into other shares or into other securities (other than a Share Reorganization), or a consolidation,
amalgamation, arrangement or merger of the Corporation with or into any other corporation or other entity (other than a consolidation,
amalgamation, arrangement or merger which does not result in any reclassification of the outstanding Shares or a change of the
Shares into other shares), or a sale, conveyance or transfer of the undertaking or assets of the Corporation as an entirety or
substantially as an entirety to another corporation or entity in which the holders of Shares are entitled to receive shares, other
securities or property, including cash (any of such events being herein called a “Capital Reorganization”),
any Optionee who exercises his right to subscribe for and purchase Shares pursuant to the exercise of Options after the effective
date of such Capital Reorganization shall be entitled to receive, and shall accept for the same aggregate consideration in lieu
of the number of Shares to which such holder was theretofore entitled upon such exercise, the aggregate number of shares, other
securities or other property, including cash, which such holder would have received as a result of such Capital Reorganization
had he exercised his right to acquire Shares immediately prior to the effective date or record date, as the case may be, of the
Capital Reorganization and had he been the registered holder of such Shares on such effective date or record date, as the case
may be, subject to adjustment thereafter in accordance with provisions the same, as nearly as may be possible, as those contained
in Sections 9.1.2 and 9.1.3 hereof. If determined appropriate by the Board, acting reasonably, subject to any necessary regulatory
approvals, appropriate adjustments shall be made as a result of any such Capital Reorganization in the application of the provisions
set forth in this Section 9, with respect to the rights and interests thereafter of the Optionee to the end that the provisions
set forth in this Section 9 shall thereafter correspondingly be made applicable as nearly as may be reasonably possible in relation
to any shares, other securities or other property, including cash, thereafter deliverable upon the exercise of the Option. Any
such adjustment shall be made by and set forth in an agreement supplemental hereto approved by action of the Board, acting reasonably,
subject in all cases to any necessary regulatory approvals, and shall for all purposes be conclusively deemed to be an appropriate
adjustment.

 

     

    	 	- 11 -
	 

    

 

		9.1.6	If and whenever at any time prior to the Expiry Time there shall occur a Share Reorganization,
a Rights Offering, a Special Distribution or an Issuer Bid and any such event results in (i) an adjustment to the Option Price
pursuant to the provisions of this Section 9 and (ii) a modification in the number of Shares outstanding, the number of Shares
purchasable upon the exercise of each Option (at the adjusted Option Price) shall be adjusted contemporaneously with the adjustment
of the Option Price by multiplying the number of Shares theretofore purchasable on the exercise thereof by a fraction, the numerator
of which shall be the applicable Option Price in effect immediately prior to such adjustment and the denominator of which shall
be the applicable Option Price resulting from such adjustment.

 

		9.1.7	In case the Corporation after the date of issue of the Options shall take any action affecting
the Shares, other than action described in this Section 9, which in the opinion of the Board, acting reasonably, would materially
adversely affect the rights of the Optionees, the Option Price or the number of Shares purchasable upon the exercise of each Option
shall be adjusted in such manner, if any, and at such time, by action of the Board, acting reasonably, as it may determine to be
equitable in the circumstances, but subject in all cases to any necessary regulatory approvals.

 

		9.1.8	Notwithstanding anything in this Section 9, should the Board determine, acting reasonably,
that any adjustment to the Option Price or the number of Shares purchasable upon the exercise of each Option made pursuant to this
Section 9 is insufficient or inadequate to protect the rights of the Optionees or to preserve the value of the Options, the
Board, acting reasonably, shall have the right to take any action as it may determine to be equitable in the circumstances, including,
without limitation, the making of any payment, to sufficiently and adequately protect the rights of the Optionees and preserve
the value of the Options, but subject in all cases to any necessary regulatory approvals.

 

		9.2	For the purposes of Section 9, any adjustment shall be made successively whenever an event referred
to therein shall occur, subject to the following provisions:

 

		9.2.1	all calculations shall be made to the nearest 1/100th of a Share;

 

		9.2.2	no adjustment shall be made in the number of Shares which may be subscribed for upon exercise of
the Option unless it would require a change of at least 1/100th of a Share; provided, however, that any adjustments which, except
for the provisions of this Section 9.2.2 would otherwise have been required to be made shall be carried forward and taken into
account in any subsequent adjustment, and that in no event shall the Corporation be obligated to issue fractional Shares or fractional
interests in Shares upon exercise of an Option or pay any amount in cash in lieu of issuing fractional Shares;

 

		9.2.3	if a dispute shall at any time arise with respect to adjustments to the Option Price or the number
of Shares purchasable pursuant to the exercise rights represented by an Option, such disputes shall be conclusively determined
by the Board, acting reasonably, and any such determination shall be conclusive evidence of the correctness of any adjustments
made;

 

     

    	 	- 12 -
	 

    

 

		9.2.4	if the Corporation shall set a record date to determine the holders of its Shares for the purpose
of entitling them to receive any dividend or distribution or any subscription or purchase rights, options or warrants and shall
thereafter and before the distribution to such shareholders of any such dividend, distribution or subscription or purchase rights
legally abandon its plan to pay or deliver such dividend, distribution or subscription or purchase rights, then no adjustment in
the Option Price or the number of Shares purchasable upon exercise of the Option shall be required by reason of the setting of
such record date; and

 

		9.2.5	as a condition precedent to the taking of any action which would require any adjustment in any
of the subscription rights pursuant to any of the Options, the Corporation shall take any corporate action that may, in the opinion
of counsel, be necessary in order that the Corporation may validly and legally issue as fully paid and non-assessable, all of the
Shares that the Optionees are entitled to receive on full exercise thereof in accordance with the provisions hereof.

 

		10	AMENDMENT OR DISCONTINUANCE OF PLAN

 

		10.1	The Board may, subject to regulatory approval, amend the Plan at any time without notice or approval
from the shareholders of the Corporation or any Optionee, for any purpose whatsoever, including, without limitation for the purpose
of:

 

		10.1.1	amendments of a “housekeeping” nature, which include, without limitation, amendments
to ensure continued compliance with applicable laws, regulations, rules or policies of any regulatory authority and amendments
to remove any ambiguity or to correct or supplement any provision contained in the Plan which may be incorrect or incompatible
with any other provision of the Plan;

 

		10.1.2	a change to the vesting provisions of an Option of the Plan;

 

		10.1.3	a change to the termination provisions of an Option which does not entail an extension beyond the
original expiration date; and

 

		10.1.4	the addition of a cashless exercise feature, payable in cash or securities, which provides for
a full deduction of the number of underlying Shares from the number of Shares reserved for issuance under the Plan;

 

provided, however, that no such
amendment may increase the maximum number of Shares that may be optioned under the Plan, change the manner of determining the minimum
Option Price, alter the Blackout Expiration Term or, without the consent of the Optionee, alter or impair any Option previously
granted to an Optionee under the Plan. Furthermore, the Board may, subject to regulatory approval, discontinue the Plan at any
time without notice or approval from the shareholders of the Corporation or any Optionee, for any purpose whatsoever.

 

     

    	 	- 13 -
	 

    

 

		10.2	Notwithstanding Section 10.1, (i) a reduction in the Option Price, (ii) an extension of the expiration
date of an outstanding Option, (iii) any amendment to the definition of “Eligible Person” under the Plan, or (iv) any
amendment which would permit Options to be transferable or assignable other than for normal estate settlement purposes, may not
be made without the approval of the shareholders of the Corporation (excluding the votes of securities held directly or indirectly
by insiders benefiting from the amendment), provided that: (x) an adjustment to the Option Price pursuant to Article 9 hereof and
(y) an extension of the expiry date pursuant to Section 5.6 hereof, in each case subject to any applicable regulatory requirements,
shall not require approval of the shareholders of the Corporation.

 

		10.3	Subject to Section 5.2.1, but notwithstanding anything else contained to the contrary in this Plan,
or in any resolution of the Board in the implementation thereof, the Board may, by resolution, and with the approval of the Toronto
Stock Exchange, approve, at the election of Optionees who cease to be directors of the Corporation upon application of the mandatory
retirement policy adopted by the Board from time to time, either:

 

		10.3.1	the acceleration of the date upon which any unvested Option may vest, and therefore be exercisable
by such Optionees, subject always to the three-month period for exercise set forth in Section 6.2; or

 

		10.3.2	notwithstanding the three-month period for exercise set forth in Section 6.2, the extension of
the period for the exercise by such Optionees of such Options as are vested and therefore are exercisable by such Optionees on
the date at which such Optionee has ceased to be a director of the Corporation from the three-month period for exercise set forth
in Section 6.2 to twelve months from the date at which any such Optionee has ceased to be a director of the Corporation.

 

The election referred to in this
Section 10.3 shall be made in writing to the Corporation no later than the date upon which such Optionees cease to be directors
of the Corporation upon application of the mandatory retirement policy. The Board shall not, in the event of any such election,
be under any obligation to accelerate the date, or extend the exercise period, in accordance with which any Option may be exercised
by any other Optionee.

 

		11	MISCELLANEOUS PROVISIONS

 

		11.1	The holder of an Option shall not have any rights as a shareholder of the Corporation with respect
to any of the Shares covered by such Option until such holder shall have exercised such Option in accordance with the terms of
the Plan (including tendering payment in full of the Option Price in respect of which the Option is being exercised) and the
Corporation shall issue such Shares to the Optionee in accordance with the terms of the Plan in those circumstances. Furthermore,
the holder of an Option shall not have any right to vote on any matter.

 

		11.2	Nothing in the Plan or any Option shall confer upon any Optionee any right to continue in the employ
of the Corporate Group or affect in any way the right of the Corporate Group to terminate his employment at any time; nor shall
anything in the Plan or any Option be deemed or construed to constitute an agreement, or an expression of intent, on the part of
the Corporate Group to extend the employment of any Optionee beyond the time that he would normally be retired pursuant to the
provisions of any present or future retirement plan of the Corporation or any present or future retirement policy of the Corporate
Group, or beyond the time at which he would otherwise be retired pursuant to the provisions of any contract of employment with
the Corporate Group.

 

     

    	 	- 14 -
	 

    

 

		11.3	References herein to any gender include all genders.

 

		12	GOVERNING LAW

 

		12.1	The Plan and any Options granted under the terms of the Plan shall be governed and interpreted
in accordance with the laws of the Province of Quebec and the federal laws of Canada applicable therein.

 

		13	EFFECTIVE DATE

 

		13.1	The effective date of this BELLUS Stock Option Plan shall be the date on which the Board approved
the Plan.

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