Document:

Commerical Lease Agreement

 Exhibit 10.4 
 COMMERCIAL LEASE AGREEMENT 
 This agreement is hereby entered
this the 9th day of August, 2000 by and between Harold J. Milholen and William F. Milholen, (hereinafter collectively “Lessor” ), and Biolex,
Inc., a Delaware corporation (hereinafter “Lessee.”) 
 WITNESSETH 
 WHEREAS, Lessor owns that certain real property and improvements as described in Exhibit “A” hereto (hereinafter “Leasehold
Premises”), same having the address of 158 Credle Street, Pittsboro, Chatham County, North Carolina; and 
 WHEREAS, Lessee is in need
of various office, laboratory, and other business work areas; and 
 WHEREAS, both Lessor and Lessee will benefit from certain improvements
to be made on the building located on the Leasehold Premises; and 
 WHEREAS, Lessor is prepared to finance such improvements so long as its
costs in doing so may be recouped and Lessee is prepared to reimburse Lessor for the costs of such improvements, 
 DEFINITIONS

 As used herein, the following definitions will be applicable: 
 “New Fixtures” shall mean any improvements, additions, or enhancements Lessor has made to the Leasehold Premises subsequent to the execution of this lease, the cost of which has been reimbursed to Lessor by Lessee. 
 “Lessor” shall mean Harold J. Milholen and William F. Milholen, their heirs, successors and assigns, as well as then designees. 
 “Lessee” shall mean the Biolex, Inc. corporation, a Delaware corporation. 
 “Lessee and/or its affiliates” shall mean Biolex, Inc., a Delaware corporation and/or its agents, affiliates, customers, invitees, employees, officers, directors and contractors, or any other person in or about the Leasehold
Premises other than Lessor or its invitees. 
 “Leasehold Premises” shall mean all land and the improvements located thereon, at 158 Credle Street,
Pittsboro, Chatham County, North Carolina as more fully described in Exhibit “A” hereto. 
 IT IS THEREFORE agreed, for good and valuable
consideration as set out in this agreement, as follows: 

 GENERAL PROVISIONS, PAYMENTS, TERM 
  

	1.	Agreement to Lease. Lessor agrees to lease the Leasehold Premises to Lessee and Lessee agrees to lease the Leasehold Premises from Lessor in exchange for payment of
annual rent of one hundred twenty one thousand eight hundred dollars ($121,800.00) per year, payable in equal monthly installments of ten thousand one hundred fifty dollars ($10,150.00), said rent to be paid in cash and to be adjusted for inflation
as set out below. The leasehold shall commence on August 1, 2000. 

  

	2.	Term of Agreement. The initial tern of this leasehold agreement shall be five (5) years. Lessee shall have the option to renew this agreement for one additional
five (5) year term. Lessee must exercise such option by notifying lessor of its intention to exercise the option in writing at least ninety (90) days before the expiration of the initial five (5) year term of this agreement.

  

	 3.
	 Place and Time of Payment. All payments due under this agreement shall be due and payable on the first day
of the month. Payment shall be made at the office of the Basic Group, in Siler City, North Carolina. Remittance of any rental or amortization payment after the tenth (10th) day of the due month shall constitute a late payment and an additional late payment penalty of five percent (5%) shall be added to any late payment. Payment of the rent due plus the late payment penalty on
or before the fifteenth (15th) day of the due month shall be deemed to be a substantial compliance with the terms of this agreement and shall not
constitute a breach of this agreement by Lessee, Failure to make any monthly payment due on the first of the month, plus any applicable late fee, on or before the fifteenth (15th) day of the due month shall constitute a breach of this agreement by Lessee. 

  

	 4.
	 Adjustment for Inflation. Some rental payments due under this agreement shall be adjusted for inflation,
beginning on the first annual anniversary date of this agreement, and annually thereafter. The initial adjustment shall be made on August 1st, 2001
and shall apply to the monthly payments beginning with the August, 2001 payment. Subsequent adjustments shall be made annually on the anniversary of the initial adjustment. Each adjustment shall be made by multiplying the ratio obtained by dividing
the current Consumer Price Index-All Urban Consumers (CPI-U) by the Consumer Price Index-All Urban Consumers (CPI-U) in effect one year earlier times the rental amount in effect one year earlier. 

  

	5.	Condition of Leasehold Premises. The Lessee has examined the Leasehold Premises, knows the present condition thereof and the equipment thereon and the Lessee agrees to
accept the Leasehold Premises in its existing condition as of the execution of this agreement, subject to all matters unrecorded as well as of record and to all applicable zoning, municipal, county. and state laws, ordinances, rules and regulations
governing and regulating use of the Leasehold Premises, and accepts this agreement subject thereto. Except as stated below, no representation has been made to the Lessee concerning the condition of the premises or any particular use that can be made
thereof. Lessor shall be under no duty to instruct Lessee or others as to the use of any 

  

													
		 		 		 	 	 		 	 	 	
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equipment on the Leasehold Premises. Lessor hereby represents and warrants that to its knowledge, the Leasehold Premises are in compliance with all
applicable laws, including without limitation the Americans With Disabilities Act of 1990. Should it be determined during the term of this agreement that the Leasehold Premises are not in material and substantial compliance with applicable law, such
noncompliance shall not, in and of itself, constitute a breach of this agreement by Lessor. Instead, Lessor warrants that it will, upon reasonable notice of, such noncompliance, take timely and reasonable action to correct such noncompliance, Lessor
further represents ,and warrants that each of the Heating, Ventilating and Air Conditioning (“HVAC”), plumbing and electrical systems located in the office portion of the Leasehold Premises are in good working order and repair and the
Lessor knows of no problem that currently needs repair with respect to any of these systems. Lessor hereby agrees to make any and all repairs necessary to the HVAC system in the office portion of the Leasehold Premises for the first six months of
this agreement. 

 MAINTENANCE, INSURANCE, UTILITIES AND TAXES 
  

	6.	Maintenance Responsibilities and Utilities. Lessee is to be responsible for all maintenance of the Leasehold Premises, interior walls, underground pipes, roof and building exterior
excluded and shall keep same in good repair during the term of this agreement. Lessor will maintain responsibility for the interior walls, roof, underground pipes, and building exterior, and shall keep the same in good repair during the term of this
agreement, assuming normal wear and tear. Notwithstanding Lessor’s obligation hereunder, should damage be caused to the interior walls, roof, underground pipes or building exterior by the acts of Lessee or its affiliates, normal wear and tear
excluded, Lessee shall be responsible for repair of such damage. Other than maintenance of the interior walls, roof, underground pipes and building exterior, Lessor shall incur no expense nor have any obligations of any kind whatsoever, other than
as set out elsewhere in this agreement or as otherwise provided by applicable law. Lessee is responsible for and shall pay promptly when due all charges for utilities including but not limited to water, sewer, electricity, telephone, and fuel
consumed on the Leasehold Premises, and any and all applicable taxes thereon. 

  

	7.	Notification. Lessee, being present on the Leasehold Premises, shall have an affirmative and continuing reasonable duty to notify Lessor promptly of any problems with,
damage to, or unusual conditions involving the interior walls, roof, underground pipes and building exterior of the Leasehold Premises which require or might require maintenance or repair by Lessor. Failure of Lessee to so notify Lessor, where such
notification would have allowed Lessor to prevent harm or damage related thereto, either to the Leasehold Premises or to the property of Lessee, in addition to any other rights of Lessor under applicable law, shall relieve Lessor of any obligation
under this agreement to reimburse, indemnify or hold harmless Lessee for any costs, damages, claims, causes of action, or attorney’s fees which may arise pursuant to said damage. 

  

													
		 		 		 	 	 		 	 	 	
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	8.	Insurance. Lessee shall be responsible for maintaining liability and casualty insurance as set forth below. All insurance to be carried under the terms of this
agreement shall be written by insurers authorized to write insurance in the State of North Carolina, which insurers shall be rated AAA or higher by Best’s Key Rating Guide-Property Liability at the time of issuance or renewal of each policy.
The Lessee shall cause its insurers to furnish to Lessor certificates of insurance which shall be furnished on an annual basis, and which shall in addition state that no policy change or cancellation will be made without giving thirty (30) days
written notice to the Lessor or its designee. The Lessee shall not do, or permit to be done, any thing which may invalidate the insurance policies required hereunder. Should Lessor be forced to procure any insurance policy as a result of
Lessee’s failure to procure said policy hereunder, the cost of such policy shall be chargeable to the Lessee, and shall be paid by Lessee to the Lessor within fifteen (15) days of receipt of a copy of the invoice for same.

  

	9.	Liability Insurance. The Lessee, at its sole expense, shall obtain and keep in force during the entire term of this agreement, including any extension hereunder, an
occurrence policy of comprehensive public liability insurance insuring the Lessor and the Lessee against any liability arising out of the ownership, use, occupancy, or maintenance of the Leasehold Premises and any equipment located thereon. Such
insurance shall be in an amount of not less than one million ($1,000,000.00) for any injury to, or death of, more than one person in any one accident or occurrence. Such insurance shall further insure the Lessor and Lessee against liability for
property damage in an amount of one hundred thousand dollars ($100,000.00). In no event shall a “claims-made” liability insurance policy be deemed to meet the requirements of this paragraph unless agreed to, in writing, by the Lessor.
Should Lessee fail to procure said insurance, Lessor may, at its option, procure and maintain said insurance, at the sole expense of Lessee as set out above. 

  

	10.	Casualty Insurance. The Lessee, as its sole expense, shall obtain and keep in force during the entire term of the agreement, including any extension hereunder, a
policy or policies of insurance covering loss or damage to the contents of the Leasehold Premises for and against all perils included within the classification of fire, extended coverage, vandalism, and malicious mischief. The insurance policies
provided for in this section shall include an inflation guard endorsement. If the Lessor shall fail to procure and maintain said insurance, Lessor may procure and maintain same at the sole expense of Lessee as set out above.

  

	11.	Property of Lessor. Except as otherwise provided for herein, all insurance proceeds in the hands of Lessor or its permanent lender or lenders at the time of the
termination of this agreement, and all insurance proceeds thereafter received by Lessor or its permanent lender or lenders under any policy or insurance required to be procured and maintained by Lessor pursuant to the terms of this agreement, shall
be the sole and exclusive property of the Lessor, subject to the rights of the Lessor’s permanent lender or lenders. 

  

													
		 		 		 	 	 		 	 	 	
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	12.	Taxes. Lessee shall also be responsible for payment of all real and personal property taxes imposed by any governmental agency having taxing authority over the
Leasehold Premises and its contents during the term of this agreement, which amount shall be pro-rated for the first and last years of this agreement. All such tax payments shall be made at least thirty days prior to the delinquency date of said
payments. Failure to make such timely tax payments shall constitute a material breach of this agreement. 

 IMPROVEMENTS/MODIFICATIONS TO LEASEHOLD PREMISES 
  

	13.	Leasehold Premises Improvements/Modifications. Upon commencement of this agreement, Lessee shall retain the services of a competent licensed professional engineer to
formulate a design plan that incorporates all related Heating/Ventilation/Air Conditioning, electrical, plumbing, and similar structural improvements/modifications necessary for Lessee’s intended use of the Leasehold Premises. Upon submission
of those plans to Lessor, and subject to the other provisions contained herein, Lessor will obtain competitive bids from appropriate contractors, negotiate a contract price and award the contract, subsequent to approval by Lessee. Such approval
shall not be unreasonably withheld, conditioned or delayed by Lessee. After award of the contract, Lessee shall designate an internal project manager to supervise the day to day construction. Any changes to the initial plans may be made only after
written approval by Lessor, which approval will not be unreasonably withheld, conditioned or delayed. Lessor and the contractor shall not amend such contract after approval by Lessee unless such amendments are approved by Lessee, such approval not
to be unreasonably withheld, conditioned or delayed. 

  

	14.	Lessor’s Right to Disapprove Improvements/Modifications. Lessor shall have the right, upon receiving the design plan referenced in item fifteen (15) above,
to review such plan and to reject and disapprove any modifications contained therein which, in Lessor’s reasonable discretion, will uniquely benefit Lessee’s particular business needs and do not contribute to the overall value of the
Leasehold Premises. 

  

	15.	Lessor to Pay Initial Cost of Approved Improvements/Modifications. After Lessor enters the contact for the approved modifications to the Leasehold Premises, Lessor
shall be responsible for making all payments due under the contract, notwithstanding that such payments are subject to reimbursement by Lessee as set out elsewhere in this agreement. 

  

	16.	Improvements/Modifications to Become Fixtures. All improvements/modifications made to the Leasehold Premises pursuant to the provisions of items twelve
(12) through fifteen (15) above shall adhere to and become fixtures of the Leasehold Premises and shall become the sole property of Lessor upon the termination of this agreement. 

  

													
		 		 		 	 	 		 	 	 	
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	17.	Lessee’s Right to Make Additional Improvements/Modifications. Lessee may, at its sole expense, and subject to approval by Lessor, make improvements/modifications
to the premises even though those modifications may have been disapproved by Lessor under item fourteen (14) above. Such improvements/modifications may be undertaken only with written approval of Lessor, such approval not to be unreasonably
withheld. Lessor reserves the right to approve such improvements/modifications subject to Lessee’s agreement to dismantle or otherwise reverse such modifications resulting in restoration of the Leasehold Premises to its condition prior to those
improvements/modifications, normal wear and tear excepted. Failure of Lessor to approve any such modification specifically does not constitute a breach of this agreement. Unless otherwise directed by Lessor at the time of approval of any
modifications made pursuant to this section, any such improvements/modifications completed by Lessee shall adhere to and become fixtures of the Leasehold Premises and shall become the sole property of Lessor upon the termination of this agreement.

  

	18.	Reimbursement for Improvements/Modifications. Lessor shall maintain records of all expenditures incurred as a result of the contract for improvements/modifications set
out in paragraph twelve (12) above. Upon completion of the improvements/modifications as per that contract, Lessor shall send written notification to Lessee of the total cost of those improvements/modifications, hereinafter the “Upfit
Amount.” Lessee shall begin to reimburse Lessor for the costs of said improvements/modifications beginning on the first day of the next month following notification. Such reimbursement shall be in cash and computed in accordance with Exhibit A
hereto. Such payment shall be made along with the rental payment each month until fully amortized. Should this leasehold end prior to the frill amortization, such payments shall continue to be payable in the same manner and on the same due date as a
rental payment. Lessee shall be permitted to prepay any portion or all of the Upfit Amount without penalty. 

 INDEMNIFICATION 
  

	19.	Lessee to Comply with Laws/Indemnify Lessor. During the term of this agreement, Lessee and/or its affiliates do hereby agree and covenant that they will materially and
substantially comply with all local, State and Federal laws, rules and regulations during all of its dealings on and affecting the Leasehold Premises. Lessee does hereby agree and covenant to indemnify and hold Lessor harmless from and against any
and all loss, damage and expense (including but not limited to reasonable attorneys’ fees) arising out of or in connection with or incurred by reason of any violation of any local, State or Federal law, rule or regulation by Lessee.

  

													
		 		 		 	 	 		 	 	 	
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	20.	Lessee to Indemnify Lessor, Civil Liability. During the term of this agreement, Lessee does hereby agree and covenant that it will indemnify and hold Lessor harmless
from and against any and all loss, damage and expense (including but not limited to reasonable attorneys’ fees) arising out of or in connection with or incurred by reason of any negligence, action, inaction or other activity or inactivity
conducted or omitted by Lessee and/or its affiliates that does or may result in any claim or cause of action against, or liability of any kind against Lessor, including but not limited to any claim or liability for Federal, State or local taxes,
whether accrued, contingent, or arising out of or with respect to any transaction, matter or thing or action by Lessee occurring during this leasehold. Lessee shall also indemnify and hold harmless Lessor from and against any and all claims arising
from Lessee and/or its affiliates’ use, possession, maintenance, and improvement of the Leasehold Premises, or from the conduct of Lessee and/or its affiliates’ business or from any activity, work or things done, permitted or suffered by
Lessee and/or its affiliates in or about the Leasehold Premises and shall further indemnify and hold harmless Lessor from and against any and all claims arising form any breach or default in the performance of any obligation on Lessee’s part to
be performed under the terms of this agreement, and from and against all costs, reasonable attorneys’ fees, expenses, and liabilities incurred in the defense of any such claim or any action or. proceeding brought thereon; and in case any action
or proceeding be brought against Lessor by reason of any such claim, Lessee, upon notice of same, shall defend Lessor from same at Lessee’s expense; provided however, that Lessee shall not be required to indemnify Lessor under the provisions of
section nineteen (19) for any costs, claims, causes of action, damages or expenses arising solely from the negligence or willful conduct of Lessor. 

  

	21.	Lessor to Indemnify Lessee. Lessor agrees that it will indemnify and hold Lessee harmless from and against any and all loss, claims, damages, and expenses (including
reasonable attorney’s fees) arising out of or in connection with or incurred by reason of any action, inaction or other activity conducted or omitted by Lessor in connection with the ownership of the Leasehold Premises and any breach or default
of Lessor’s obligations under this agreement, except where such harm, loss, claim, damage or expense occurred as a result of a condition or conditions that Lessee was, or should have been, aware of, and where Lessee had failed to give
reasonable notice of same to Lessor, where such notice would have afforded Lessor an opportunity to correct said condition or conditions prior to the harm, loss, damage or expense to Lessee occurring. 

  

	22.	Exemption of Lessor From Liability. Lessee hereby agrees that except for any matter arising out of Lessor’s willful act or omission, or negligence, Lessor shall
not be liable for injury to Lessee’s business or any loss of income therefrom or for damage to the goods, wares, merchandise or other property of Lessee or to any of Lessee’s employees, contractors, invitees, customers, or any other person
in or about the Leasehold Premises, whether such damage or injury is caused by or results from fire, steam, electricity, gas, water or rain, or from breakage, leakage, obstruction, or other defects of pipes, sprinkler, wires, appliances,

  

													
		 		 		 	 	 		 	 	 	
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plumbing, air conditioning, or lighting fixtures, or from any other cause, whether the said damage or injury results from conditions arising upon the
Leasehold Premises, unless Lessor was responsible for maintaining the item or item that caused such damage under the terms of this lease and had previously been notified by Lessee of a pending problem with said item, and then failed to give
reasonable attention to the repair or maintenance necessary to correct that pending problem within a reasonable time. 

  

	23.	Prohibition of Nuisance. The Lessee and/or its affiliates shall not use or permit the use of the Leasehold Premises in any manner that will tend to create waste or a
nuisance. Lessee agrees to indemnify and hold harmless Lessor for any claim or action arising out of any such act on the Leasehold Premises, including payment of Lessor’s reasonable attorneys’ fees accrued when defending against any such
claim or action. 

  

	24.	Environmental Provisions. In the event there is a violation of any Environmental Law involving any hazardous substance on the Leasehold Premises or any other violation
of any Environmental Law on the Leasehold Premises during the term of this agreement. Lessee expressly guarantees that it will assume all costs incurred to investigate the nature and severity of the adverse environmental conditions, conduct studies
to determine the impact of the adverse environmental condition upon the public health, eliminate the adverse environmental condition, conduct tests following the cleanup in order to determine whether remedial efforts have been successful, and
indemnify and hold harmless the Lessor from claims of third parties as a result of the adverse environmental condition, including reasonable attorneys fees, unless the costs, claims or liabilities arose solely out of the actions or negligence of
Lessor. As used herein, the term “hazardous substance” shall mean any toxic, radioactive, ignitable, reactive, corrosive, contaminating or polluting substance, waste or material including oil, petroleum products and their derivatives,
solvents, polychlorinated biphenyls (“PCBs”) or asbestos, which is now or may in the future be regulated Linder any Environmental Law. The term “Environmental Law” shall mean any federal, state or local statute, regulation, rule,
ordinance or order now in effect or becoming effective in the fixture relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata), emissions,
discharges or releases of pollutants, contaminants, oil, petroleum products and their derivatives, asbestos, solvents, PCB, chemicals, industrial toxic or hazardous substance or solid or hazardous wastes, or the manufacture, processing,
distribution, use, treatment, handling, storage or disposal and transportation of such materials. The term “Environmental Condition” shall mean the presence, whether discovered or undiscovered, in surface water, groundwater, drinking,
water supply, land surface, subsurface strata, buildings or ambient air of any hazardous substance arising out of or otherwise related to the operations or other activities, (including the disposition of such material or substances, except petroleum
products held for resale in approved containers) concluded or 

  

													
		 		 		 	 	 		 	 	 	
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undertaken at the Leasehold Premises, or flowing, diffusing, migrating, percolating into, onto or under the Leasehold Premises but not from off-site. Lessor
represents and warrants that it is aware of no unresolved notice, citation, summons or order having been issued, no complaint having been filed, no penalty having been assessed and no investigation or review pending or threatened by any governmental
agency or other entity or party regarding any alleged violation of the Environmental Laws on or about the Leasehold Premises. Lessor further represents and warrants that it has no knowledge of any facts or circumstances related to environmental
matters concerning the Leasehold Premises that may lead to future environmental claims, liabilities or responsibilities against Lessor or Lessee. Lessor further represents and warrants that it has no knowledge of the presence of ally (a) PCBs
or materials containing asbestos in or on the Leasehold Premises or (b) underground storage tanks, abandoned or active, under the Leasehold Premises. Lessor hereby does state that two (2) USTs have been removed from the premises and
sufficient cleanup has been accomplished to receive a NFA(No Further Action) letter from the State UST Section. Lessor agrees to indemnify and hold harmless Lessee from any and all losses, costs, damages, and expenses (including fines, penalties and
reasonable attorney’s fees) related to events or conditions first existing prior to the date of this Agreement, known and unknown, foreseen and unforeseen, and which arise under any Environmental Law, including without limitation the removal of
any asbestos on the Leasehold Premises. 

  

	25.	Prohibition of Liens. Lessee and/or its affiliates shall take no action or engage in any dealings which might or could result in any person, firm or agency placing any
lien, UCC, financing statement or any other legal burden on the Leasehold Premises. Should any such lien or claim be filed against the Leasehold Premises as a result of any action, inaction or omission by Lessee, as soon as notice of such is
received, Lessee shall immediately proceed, at its sole expense, to take all necessary steps to have such lien or claim be removed or satisfied. 

 DEFAULT/TERMINATION/END OF AGREEMENT 
  

	26.	Default. Failure of the Lessee to make any payment hereunder, as and when due, where such failure shall continue for a period of five (5) days shall constitute
default hereunder. The failure of Lessee to observe and perform any covenants, conditions, or provisions of this agreement shall also constitute default where such failure shall continue for fifteen (15) days after it becomes known to Lessee by
written notice form Lessor, provided, however, that if the nature of Lessee’s default such that more than fifteen (15) days are reasonably required for its cure, then Lessee shall not be deemed to be in default if Lessee commenced such
cure within fifteen (15) days and thereafter diligently prosecutes such cure to completion. Filing of bankruptcy by Lessee, the making by Lessee of any general assignment or arrangement for the benefit of creditors, filing a petition for
reorganization, the appointment of a trustee or receiver to take possession of substantially all of Lessee’s assets located at the Leasehold Premises, or the attachment, execution or other judicial seizure of substantially all of Lessee’s
assets located at the Leasehold Premises shall also constitute default. 

  

													
		 		 		 	 	 		 	 	 	
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	27.	Termination in Event of Default. Lessor shall have, in the event of default by Lessee, in addition to other rights and remedies at law or equity, the right to either
terminate this agreement or to continue this agreement in full force and effect. Unless otherwise provided herein, this agreement shall be terminated only upon Lessor’s notification of Lessee in writing of Lessor’s termination of the
agreement or upon the institution by Lessor of a judicial proceeding for the primary purpose of termination of the agreement which in fact results in a termination of Lessee’s right of possession of the premises. In no event shall the following
actions by Lessor, either before or after abandonment of the Leasehold Premises by Lessee constitute a termination of this lease: maintenance or preservation of the premises, efforts to relet the premises, or appointment of a receiver to protect
Lessor’s interest hereunder. If Lessor elects to terminate this lease, Lessor shall, without liability to Lessee, have the right to immediately reenter the Leasehold Premises, remove all persons and property therefrom, and store any property so
removed in a public warehouse, or elsewhere, at the cost of and to the account of Lessee; provided that the Lessee shall have the right after reasonable notice to monitor the removal and storage of any lab equipment. 

  

	28.	Remedies upon Default. If Lessor terminates this agreement on account of Lessee’s breach or default, Lessee shall pay to Lessor and be liable for (1) all
rents and other charges due and payable at termination plus twelve percent (12%) interest per annum until payment; (2) all rents and other charges which become due and payable between the time of termination and the time of award, less any
rent Lessor has actually received from reletting the premises; and (3) all costs, expenses and losses Lessor incurs by reason of Lessee’s breach or default of this lease, including but not limited to all expenses for repairing or restoring
the premises, all costs associated with reletting the premises, all expenses incurred in retaking the premises, and reasonable attorneys’ fees and court costs. If, upon breach of this agreement by Lessee, Lessor elects to continue with this
agreement, Lessor may, in addition to enforcing any other rights and remedies, exercise all of its rights and remedies hereunder and Lessee shall remain obligated to perform all of Lessee’s obligations hereunder, including without limitation,
timely payment of all rents and other charges. In addition, Lessee shall be liable for Lessor’s reasonable attorneys’ fees and costs incurred by reason of Lessee’s breach or default. 

  

	 29.
	 Event of Default, Attorneys’ Fees. Except as other set forth herein, failure of Lessee to make any
payment due on the first of the month on or before the fifteenth (15th) day of the due month shall constitute a default and breach of this agreement.
In the event of this or any other breach or default of this agreement by Lessee, in addition to any damages due at law or at equity, Lessee shall be liable for all reasonable attorneys’ fees accrued by Lessor by way or reason of its attempts to
enforce this agreement, or during any attempt to recover damages accrued as a result of said default or breach of this agreement. 

  

													
		 		 		 	 	 		 	 	 	
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	30.	Surrender. On the last day of the term of this agreement, or on any sooner termination, the Lessee shall peaceably and quietly surrender the Leasehold Premises and the
fixtures thereon, including those placed by Lessee, except as may be specifically excluded herein or by some other writing between Lessor and Lessee, to the Lessor in the same condition as when the Leasehold Premises was occupied and the fixtures
were completed, broom clean, ordinary wear and tear, and loss by casualty required to be insured by Lessor excepted. The Lessee shall repair any damage to the premises occasioned by the removal of Lessee’s equipment, furnishings, or fixtures
that the Lessee is obligated to remove pursuant to number sixteen (16) above, which repair shall include the patching and filling of any holes as well as the repair of any damages caused thereby, In no event may Lessee remove any of the
fixtures or other improvements/modifications made pursuant to paragraph twelve (12) above. 

 DAMAGE TO OR DESTRUCTION
OF PREMISES 
  

	31.	Damage or Destruction. If the Leasehold Premises shall suffer an insured loss, Lessee shall, as soon as the Lessee has collected the full amount of insurance proceeds,
commence repairing or rebuilding the damaged part of the Leasehold Premises. Notwithstanding the obligation to rebuild, if the main building located on the Leasehold Premises shall be damaged to such an extent that the estimated costs of repairs and
restoration shall be greater than sixty percent (60%) of the value of the building immediately before said damage, then either Lessor or Lessee shall have the option of terminating this agreement as of the date of the damage by giving written
notice to the other party within fifteen days of the date of such damage. If the lease be so terminated, the insurance proceeds shall, at the option of Lessor, be applied to the demolition and cleanup or replacement of the damaged structure, or be
divided ratably between Lessor and Lessee based upon the amount of this agreement completed. Upon such termination, except as set forth above, Lessor and Lessee’s respective obligations hereunder shall terminate. 

  

	32.	Destruction/Non-abatement. In the event the premises are totally destroyed, or the Leasehold Premises cannot be repaired under applicable law, notwithstanding the
availability of insurance proceeds or contributions from Lessee, the lease shall be terminated effective the date of the damage. 

 MISCELLANEOUS PROVISIONS 
  

	33.	Time of the Essence. Unless otherwise stated conversely herein, time is of the essence for all provisions of this agreement. 

  

	34.	North Carolina Law. This agreement is to be constructed and construed by and under the laws of the State of North Carolina. 

  

													
		 		 		 	 	 		 	 	 	
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	35.	Chatham County Venue. Any dispute arising hereunder shall be adjudicated solely in the Courts of Chatham County, North Carolina, so long as jurisdiction may be
obtained over the subject matter and the parties thereto. If and only if it is impossible to adjudicate this matter in Chatham County, North Carolina, may the venue for any adjudication be otherwise. 

  

	36.	Quiet Enjoyment. The Lessor covenants that the Lessee upon performing its covenants and obligations hereunder shall peaceably and quietly hold and enjoy the Leasehold
Premises, and all rights, privileges, easements, and appurtenances appertaining thereto, throughout the term of this agreement and any extension thereto. 

  

	37.	Lessor’s Access. Lessor and its agents shall have the right to enter the Leasehold Premises at reasonable tunes for the purpose of inspection or for showing the
same to prospective purchasers or lenders upon reasonable advance notice to Lessee. The Lessor may enter the Leasehold Premises to make alterations, repairs, improvements or additions to same; however, such work shall not unreasonably interfere with
Lessee’s use of the premises during its normal working hours. 

  

	38.	Severability. Invalidation of any provision of this agreement, as determined by a court of competent jurisdiction, shall in no way effect the validity of any other
provision hereof. 

  

	39.	Interest. Except as expressly herein provided, any amount due to the Lessor not paid when due shall, after thirty (30) days bear interest at twelve percent
(12%) per annum. Payment of such interest shall not excuse nor cure any default by Lessee. Payment of interest shall be in addition to any late fees due under this agreement. 

  

	40.	Entire Agreement. This agreement constitutes the entire agreement between the parties hereto, and any changes shall be in writing and signed by all parties.

  

	41.	Notices. Any notices required hereunder shall be mailed to Lessor at Post Office Box 688, Siler City, NC 27344 and to Lessee at 158 Credle Street, Pittsboro, NC 27312.

  

	42.	Waiver. No waiver by the Lessor of any provision of this agreement shall be deemed a waiver of any other provision hereof or of any subsequent breach by Lessee of the
same or any other provision. Lessor’s consent to, or approval of, any act shall not be deemed to render unnecessary the obtaining of Lessor’s consent to, or approval of, any subsequent act of Lessee. The acceptance of rent hereunder by
Lessor shall not be a waiver of any preceding breach by Lessee of any provision hereof, other than the failure of Lessee to pay the particular rent so accepted, regardless of Lessor’s knowledge of such preceding breach at the time of acceptance
of rent. 

  

													
		 		 		 	 	 		 	 	 	
		 		 		 	Lessor	 		 	Lessee	 	

  

 12 

	43.	Cumulative Remedies. No remedy or election hereunder shall be deemed exclusive, but shall, wherever possible, be cumulative with all other remedies at law or in
equity. 

  

	44.	Covenants and Conditions. Each provision of this agreement performable by Lessor and Lessee shall be deemed both a covenant and a condition. 

 

	45.	Attorneys’ Fees. Should either party begin an action to enforce the terms hereof or declare rights hereunder, except as otherwise provided herein, then prevailing
party shall be entitled to reasonable attorneys’ fees to be paid by the losing party as fixed by the court. 

  

	46.	Sublease. The Lessee may sublease the Leasehold Premises or any portion thereof only with the express written consent of lessor. Lessor may not unreasonably withhold,
condition or delay such consent. Failure of Lessor to consent to a sublease to any person or firm that will or may possess, process, or otherwise be involved with any “hazardous substance”, as defined in section twenty three
(23) above, shall not be unreasonable. 

  

	 47.
	 Lessee’s Right, of First Refusal. At any time during the term of this leasehold agreement, or during
any option period hereunder, Lessee shall have a right of first refusal to purchase the Leasehold Premises. Should Lessor receive a bona fide offer to purchase the Leasehold Premises, said offer shall be communicated in writing to Lessee. Lessee
shall then have until 5:00 pm on the tenth (10th) business day following receipt of notification of that offer to match that offer and agree to
purchase the Leasehold Premises under the terms and conditions thereof. 

  

													
		 		 		 	 	 		 	 	 	
		 		 		 	Lessor	 		 	Lessee	 	

  

 13 

 This agreement is hereby entered and executed this the 9th day of August, 2000. 
  

									
	Lessor by	 		 		 		 	
					
	 /s/ Harold J. Milholen
	 	(SEAL)	 		 	 /s/ William F. Milholen
	 	(SEAL)
	Harold J. Milholen	 		 		 	William F. Milholen	 	
					
	Lessee Biolex, Inc. by:	 		 		 		 	
					
	 /s/ Anne-Marie Stomp
	 	(SEAL)	 		 	 /s/ Howard Hollar
	 	(SEAL)
	Anne-Marie Stomp	 		 		 	Howard Hollar	 	
	President	 		 		 	Secretary, Attest	 	

  

			
	SEAL-STAMP	  	NORTH CAROLINA, Chatham County.
		
		  	I, Tina R. Burgess, a Notary Public of the County and State aforesaid, certify that HAROLD J. MILHOLEN personally came before me this day and acknowledged the due execution of the foregoing
instrument.
		
		  	Witness my hand and official stamp or seal, this 9th day of August, 2000.
		
		  	            /s/Tina R.
Burgess                            , Notary Public
		
		  	My commission expires: 3/17/04
		
	SEAL-STAMP	  	NORTH CAROLINA, Chatham County.
		
		  	I, Tina R. Burgess a Notary Public of the County and State aforesaid, certify that WILLIAM F. MILHOLEN personally came before me this day and acknowledged the due execution of the foregoing
instrument.
		
		  	Witness my hand and official stamp or seal, this 9th day of August, 2000.
		
		  	            /s/ Tina R.
Burgess                            , Notary Public
		
		  	My commission expires: 3/17/04

  

													
		 		 		 	 	 		 	 	 	
		 		 		 	Lessor	 		 	Lessee	 	

  

 14 

			
		
	SEAL.-STAMP	  	NORTH CAROLINA, Chatham County.
		
		  	I, Tina R. Burgess, a Notary Public of the County and State aforesaid, certify that HOWARD HOLLAR personally came before me this day and acknowledged the due execution of the foregoing
instrument.
		
		  	Witness my hand and official stamp or seal, this 9th day of August, 2000.
		
		  	            /s/ Tina E.
Burgess                            , Notary Public
		
		  	My commission expires: 3/17/04

  

													
		 		 		 	 	 		 	 	 	
		 		 		 	Lessor	 		 	Lessee	 	

  

 15 

 COMMERCIAL LEASE AGREEMENT 
 HAROLD J. MILHOLEN AND WILLIAM F. MILHOLEN 
 AND BIOLEX, INC. 

EXHIBIT A 
 The interest rate for the
Improvements/Modifications shall be calculated at an interest rate of 7.5 percent per annum above the prime rate. The rate shall be adjusted annually on the anniversary date of this agreement and annually thereafter for changes in the prime rate.

  

													
		 		 		 	 	 		 	 	 	
		 		 		 	Lessor	 		 	Lessee	 	

 Milholen Properties, LLC 
 P O Box 688 
 1220 Harold Andrews Road 
 Siler City, North Carolina 27344 
 Phone 919-663-2244 
 Fax 919-663-2172 
 E-Mail wfm@basicmachinery.com 
 April 14, 2005 
 Mr. Dale Sander, CFO and SVP of Finance 
 Biolex, Inc. 
 158 Credle Street 
 Pittsboro, NC 27312 
 Subject: 158 Credle Street. Pittsboro, NC lease 
 Dear Mr. Sander:

 We are in receipt of your letter dated April 12, 2005 giving us notice of Biolex, Inc. exercise of the renewal option in the
Commercial Lease Agreement dated August 9, 2000. 
 Thank you for the notification and continuation of the lease. We at Milholen
Properties, LLC look forward to a long and mutually beneficial relationship. When Biolex needs to expand further we would like to be involved. 
 When you need another facility, Milholen Properties, LLC would like to be considered to build and lease or purchase and lease the facility for your needs. 
  

	
	Best regards,
	
	 /s/ William F. Milholen

	William F. Milholen
	Member, Manager

 April 12, 2005 
 VIA
CERTIFIED U.S. MAIL — RETURN RECEIPT REQUESTED 
 Harold J. Milholen and William F. Milholen 
 1220 Harold Andrews Road 
 Siler City, North Carolina 27344 
  

	 	RE:	158 Credle Street, Pittsboro, NC Lease—Notice of Exercise of Renewal Option 

 Dear Sirs: 
 Biolex, Inc. (“Biolex”) and Harold J. Milholen and William F. Milholen (collectively, the
“Landlord”) are parties to that certain Commercial Lease Agreement dated as of August 9, 2000 (the “Lease”), for premises located at 158 Credle Street, Pittsboro, North Carolina. This letter serves as formal notice of
Biolex’s election to exercise its renewal option under the Lease, as set forth below. 
 In accordance with Section 2 of the Lease,
Biolex notifies Landlord that it hereby exercises its option to renew the Lease for an additional five (5) year term (the “renewal term”). Thus, the term of the Lease will now extend uninterrupted through July 31, 2010. We
further understand that, pursuant to Section 4 of the Lease, rental payments during the renewal term will be adjusted as of August 1 for each 12-month period of the renewal term. 
 The Lease remains in full force and effect until the expiration or termination of the renewal term. Please contact me if you have any questions.

  

	
	Sincerely,
	
	 /s/ Dale Sander

	Dale Sander
	CFO and SVP of Finance

  

					
		 	 158 Credle Street
 Pittsboro, NC 27312
	 	 tel 919.542.9901
 fax 919.542.9910
 www.blolex.com2003 Equity Incentive Plan

 Exhibit 10.9 
 BIOLEX, INC. 
 2003 EQUITY INCENTIVE PLAN 
 1. Purpose. This Plan authorizes the Committee to provide employees of the Company and other persons who are eligible to participate in the Plan
with Shares, Stock Appreciation Rights and Options to acquire Shares in the Company. The Company believes that this incentive program will cause those persons to increase their interest in the welfare of the Company and its subsidiaries, and will
aid in attracting, retaining and motivating persons of outstanding ability. 
 2. Definitions. Capitalized terms not otherwise defined
herein shall have the meanings set forth in this Section. 
 (a) “Board” shall mean the Board of Directors of the Company.

 (b) “Change of Control Transaction” shall mean (i) a sale, transfer or other disposition of all or substantially all of the
assets of the Company to another person or entity, (ii) a merger or consolidation into another person or entity, other than the merger of a subsidiary of the Company into the Company or the merger of the Company into a subsidiary, or
(iii) a recapitalization, stock sale or other transaction or series of transactions if, after such transaction or series of transactions, the stockholders of the Company immediately before such transaction or the first in such series of
transactions own less than fifty percent (50%) of the Company or the surviving entity, as the case may be, other than an equity financing transaction approved by a majority of the members of the Board, which majority shall include at least two
(2) of the Series AA2 Directors and each of the Provisional Directors then serving on the Board (the terms “Series AA2 Directors” and “Provisional Directors,” if any, as defined in the Second Amended and Restated Investor
Rights Agreement of the Company). 
 (c) “Company” shall mean Biolex, Inc., a corporation organized under the laws of the State of
Delaware, and its subsidiaries. 
 (d) “Committee” shall mean the committee of the Board designated by the Board to administer the
Plan, or in the absence of any such designation, the Board. 
 (e) “Effective Date” shall have the meaning set forth in
Section 13. 
 (f) “Eligible Participant” shall mean any person or entity that is providing, or has agreed to provide,
services to the Company or subsidiary of the Company, whether as an employee, director, advisor or independent contractor. 
 (g) “Fair
Market Value” of a Share on any given date shall be determined in good faith by the Committee, taking into account such factors as the Committee determines are appropriate. 
 Confidential to Biolex, Inc. 

 (h) “Grant Agreement” shall mean a written agreement between the Company and a Grantee
evidencing the grant of an Option, Stock Appreciation Right or Shares hereunder and containing such terms and conditions, not inconsistent with the Plan, as the Committee shall approve. 
 (i) “Grantee” shall mean a person granted an Option, Stock Appreciation Right or Shares under the Plan. 
 (j) “IPO” shall mean the consummation of an underwritten, registered initial public offering of the Company’s Shares. 
 (k) “Incentive Stock Option” or “ISO” shall mean any Option or portion thereof that is designated in a Grant Agreement as an ISO and
meets the requirements of an incentive stock option under Section 422 of the Internal Revenue Code of 1986, as amended. 
 (l)
“Nonqualified Option” or “NSO” shall mean any Option or portion thereof that either is designated in a Grant Agreement as an NSO or is otherwise not an ISO. 
 (m) “Options” shall refer to options issued under and subject to the Plan. 
 (n) “Permitted Transferee” shall mean (i) the Grantee’s spouse, (ii) any lineal ancestor or descendant (including by adoption
and stepchildren) of the Grantee, (iii) any trust of which the Grantee is the controlling trustee and which is established solely for the benefit of any of the foregoing individuals, (iv) the estate of the Grantee established by reason of
the Grantee’s death, or (v) any corporation, limited liability company or partnership, all of the interests of which are (or is) owned by one or more of the persons identified in (i), (ii), (iii) or (iv) of this clause.

 (o) “Person” shall mean an individual, partnership, corporation, limited liability company or partnership, trust, unincorporated
organization, joint venture, government (or agency or political subdivision thereof) or any other entity of any kind. 
 (p) “Plan”
shall mean the Biolex, Inc. 2003 Equity Incentive Plan, as set forth herein and as amended from time to time. 
 (q) “Share” shall
mean a share of the Company’s Class A Voting Common Stock, par value $0.001 per share. 
 (r) “Stock Appreciation Rights”
or “SARs” shall mean a right to a payment equal to the increase in the value of the underlying Shares above the grant price of the SAR. At the discretion of the Committee, SARs may be settled in cash or Shares. 
 (s) “Unvested Shares” shall have the meaning set forth in Section 8. 
 (t) “Vested Shares” shall have the meaning set forth in Section 8. 
  

					
	Confidential to Biolex, Inc.	  	2	  	

 3. Shares Available under the Plan. The total number of Shares that may be issued under the Plan
shall not exceed 3,201,088; provided, however, that upon the Milestone Second Tranche Closing or upon any Optional Second Tranche Closing (each as defined in that certain Preferred Stock Purchase Agreement, dated August 8, 2003, by and among
the Company and certain of its investors), the total number of Shares that may be issued under the Plan shall be increased to 4,360,500 Shares (in the case of the Milestone Second Tranche Closing) or to such number of Shares (in the case of any
Optional Second Tranche Closing) correlative to the number of shares of Series AA2 Preferred Stock issued in such closing, in each case without any further action on the part of the Board or the stockholders of the Company. If an Option or SAR
granted under the Plan expires, terminates or is cancelled prior to the issuance of Shares thereunder, or if Shares are issued under the Plan and thereafter are reacquired by the Company, the Shares subject to those Options and SARs and the
reacquired Shares shall be added to the Shares available for benefits under the Plan. Shares covered by a grant made under the Plan shall not be counted as used unless and until they are actually issued and delivered to a participant. In addition,
any Shares exchanged by an optionee as full or partial payment to the Company of the exercise price under any Option granted under the Plan, any Shares retained by the Company pursuant to a participant’s tax withholding election, and any Shares
covered by a grant that is settled in cash, shall be added back to the Shares available for grants under the Plan. Shares issued under the Plan may be either authorized and unissued Shares or issued Shares reacquired by the Company. 
 4. Administration of the Plan. 
 (a)
Administration by the Committee. The Committee shall administer the Plan. If, following an IPO of the Company, a committee of the Board administers the Plan, such Committee shall consist of two or more directors as the Board may designate
from time to time, each of whom shall satisfy such requirements as: 
 (i) the Securities and Exchange Commission may establish for
administrators of plans intended to qualify for exemption under Rule 16b-3 or its successor under the Securities Exchange Act of 1934 (the “Exchange Act”); 
 (ii) the New York Stock Exchange or the NASD, as applicable, may establish for plans of listed companies pursuant to its rule-making authority; and 
 (iii) the Internal Revenue Service may establish for outside directors of plans intended to qualify for exemption under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the “Code”). 
 (b) Authority of the Committee. The Committee shall have full and
final authority to take the following actions, in each case subject to and consistent with the provisions of the Plan: 
 (i) to select the
Eligible Participants to whom grants may be made under the Plan, and the number of Shares relating thereto, including, without limitation, approving schedules of grants to be made to classes of Eligible Participants; 
  

					
	Confidential to Biolex, Inc.	  	3	  	

 (ii) to determine the terms and conditions of all grants under the Plan, including, with respect to
Options, the type of Option, the exercise price, any conditions relating to exercise, including vesting, and the termination of the right to exercise; 
 (iii) to determine the restrictions or conditions related to the delivery, holding and disposition of Shares issued under the Plan; 
 (iv) to prescribe the form of each Grant Agreement; 
 (v) to adopt, amend, suspend, waive and rescind such
rules and regulations and appoint such agents as the Committee may deem necessary or advisable to administer the Plan; 
 (vi) to correct
any defect or supply any omission or reconcile any inconsistency in the Plan, and to construe and interpret the Plan and any Grant Agreement or other instrument hereunder; and 
 (vii) to make all other decisions and determinations as may be required under the terms of the Plan or as the Committee may deem necessary or advisable
for the administration of the Plan. 
 (c) Manner of Exercise of Committee Authority. Any action of the Committee with respect to the
Plan shall be final, conclusive and binding on all persons, including the Company, subsidiaries of the Company, Grantees, or any person claiming any rights under the Plan from or through any Grantee, except to the extent the Committee may
subsequently modify, or take further action not consistent with, its prior action. The express grant of any specific power to the Committee, and the taking of any action by the Committee, shall not be construed as limiting any power or authority of
the Committee. The Committee may delegate to officers or managers of the Company or any subsidiary of the Company the authority, subject to such terms as the Committee shall determine, to perform such functions as the Committee may determine, to the
extent permitted under applicable law. 
 (d) Limitation of Liability. The Committee shall be entitled, in good faith, to rely or act
upon any report or other information furnished to it by any officer or other employee of the Company or any of its subsidiaries, the Company’s independent certified public accountants or any executive compensation consultant, legal counsel or
other professional retained by the Company to assist in the administration of the Plan. To the fullest extent permitted by applicable law, neither any member of the Committee, nor any officer or employee of the Company acting on its behalf, shall be
personally liable for any action, determination or interpretation taken or made in good faith with respect to the Plan, and each member of the Committee and any officer or employee of the Company acting on its behalf shall, to the extent permitted
by law and required by the Amended and Restated Certificate of Incorporation and Bylaws of the Company, be fully indemnified and protected by the Company with respect to any such action, determination or interpretation. 
  

					
	Confidential to Biolex, Inc.	  	4	  	

 5. Eligibility. All Eligible Participants shall be eligible for grants under the Plan; provided,
however, that only employees of the Company and its subsidiaries shall be eligible to be granted ISOs. 
 6. Terms Relating to
Options. 
 (a) Generally. Options granted under the Plan shall be subject to the terms of the Plan and such other terms as the
Committee shall set forth in each Grant Agreement. 
 (b) Termination of
Options. Except as otherwise provided in a Grant Agreement, upon the termination of a Grantee’s status as an Eligible Participant for any reason, (i) Options that are not then vested and exercisable shall immediately terminate and
(ii) Options that are vested and exercisable shall remain exercisable until, and terminate upon, the 91st day following such termination (or the 366th
day following such termination, where such termination is by reason of death, or a disability that is approved by the Committee for purposes hereof); provided, however, that in any event, each Option shall terminate upon the tenth anniversary of the
date of grant, or such earlier time as may be provided by action of the Committee pursuant to Section 9. 
 (c) Exercise of
Options. Options granted to Eligible Participants who are non-exempt employees under the Fair Labor Standards Act of the Company or a subsidiary shall not be exercisable within less than 6 months after the date of grant. Only the vested portion
of any Option may be exercised. A Grantee shall exercise an Option by delivery of written notice to the Company setting forth the number of Shares with respect to which the Option is to be exercised, together with the exercise price payable in the
form of (i) cash or its equivalent, (ii) the tender of previously acquired shares (held for at least six months, if the Company is accounting for Stock Options using APB Opinion 25, or purchased on the open market) having a Fair Market
Value at the time of exercise equal to the option price, or certification of ownership of such previously-acquired shares, (iii) the delivery of a properly executed exercise notice, together with irrevocable instructions to a broker to promptly
deliver to the Company the amount of sale proceeds from the Option shares to pay the exercise price and any withholding taxes due to the Company, (iv) prior to the date the Company is subject to the reporting requirements of the Exchange Act in
the sole discretion of the Committee at the time the Option is exercised, by delivery of a promissory note in a form approved by the Committee; or (v) such other methods of payment as the Committee, at its discretion, may deem appropriate.

 Before any Shares are issued pursuant to the exercise of an Option, the Company shall have the right to require that the Grantee make such
provision, or furnish the Company such authorization, necessary or desirable so that the Company may satisfy its obligation under applicable income tax laws to withhold for income and employment taxes due upon or incident to such exercise. The
Committee, may, in its discretion, permit such withholding obligation to be satisfied through the withholding of Shares that would otherwise be delivered upon exercise of the Option. 
  

					
	Confidential to Biolex, Inc.	  	5	  	

 (d) Transferability. No Option may be sold, transferred, assigned, pledged or otherwise
encumbered, and an Option shall be exercisable only by the Grantee, provided that the Committee may permit transfers to a Permitted Transferee. Any such Permitted Transferee shall be subject to all the terms and conditions of the Plan and Grant
Agreement, including the provisions relating to the termination of the right to exercise the Option. 
 7. Terms Relating to SARs. The
Committee may grant SARs to Grantees at its discretion. The Committee may grant SARs in tandem with Options or on a freestanding basis. The Committee may substitute SARs that can be settled only in stock for outstanding Options at any time after the
Company is subject to fair value accounting. The Committee shall determine the grant price of SARs and the terms and conditions upon which SARs may be exercised. Upon exercise of an SAR, the Grantee shall be entitled to receive payment from the
Company in an amount determined by multiplying the excess of the Fair Market Value of a Share on the date of exercise over the grant price of the SAR by the number of Shares with respect to which the SAR is exercised. Such payment by the Company may
be made in cash or stock, at the discretion of the Committee. 
 8. Terms Relating to Grants of Shares. The Committee may grant Shares
to a Grantee that may or may not be conditional upon the Grantee’s future performance of services and/or achievement of specified performance targets. Shares granted under the Plan that are so conditional are referred to as “Unvested
Shares,” and Shares that are not so conditional are referred to as “Vested Shares.” Except to the extent restricted under the terms of the Plan and any Grant Agreement, a Grantee awarded Unvested Shares shall have all of the rights of
a stockholder including, without limitation, the right to vote Unvested Shares and the right to receive dividends thereon. The Committee may require the Grantee to pay (in cash or such other form as determined by the Committee, including, prior to
the date the Company is subject to the reporting requirements of the Exchange Act, in the sole discretion of the Committee at the time the Option is exercised, by delivery of a promissory note in a form approved by the Committee) for Shares at a
price per Share up to the Fair Market Value thereof. The grant of Shares or the lapse of restrictions on Unvested Shares shall be conditional on the Grantee’s satisfaction of any withholding tax obligation that arises in connection therewith.

 9. Adjustment Upon Changes in Capitalization. In the event any recapitalization, forward or reverse split, reorganization, merger,
consolidation, incorporation, spin-off, combination, repurchase, exchange of Shares or other securities, dividend or distribution of Shares or other special and nonrecurring dividend or distribution (whether in the form of cash, securities or other
property), liquidation, dissolution, sale or purchase of assets or other similar transactions or events, affects the Shares such that an adjustment is, in the sole discretion of the Committee, appropriate in order to prevent dilution or enlargement
of the rights of Grantees under the Plan, then the Committee shall equitably adjust any or all of (i) the number and kind of securities deemed to be available thereafter for grants under Section 3, (ii) the number and kind of
securities subject to Unvested Shares and outstanding Options and SARs, and (iii) the exercise price per Share of Options and the grant price of SARs. In addition, the Committee shall be authorized to make adjustments in the terms and
conditions of, and the criteria included in, Unvested Shares, Options and SARs (including, without limitation, acceleration of the expiration date of Options and SARs, cancellation of Options and SARs in exchange for the intrinsic 

  

					
	Confidential to Biolex, Inc.	  	6	  	

 
(i.e., in-the-money) value, if any, of the vested portion thereof, or substitution of Unvested Shares, Options and SARs using securities or other
obligations of a successor or other entity) in recognition of unusual or nonrecurring events (including, without limitation, a Change of Control Transaction or an event described in the preceding sentence) affecting the Company or any subsidiary of
the Company or the financial statements of the Company or any subsidiary of the Company, or in response to changes in applicable laws, regulations, or accounting principles. 
 10. Effect of Change of Control Transaction. 
 (a) Generally. Notwithstanding any provision of Section 9 above, in the event of a Change of Control Transaction, immediately prior to the consummation of the transaction, Unvested Shares held by Eligible Participants shall
become vested, and outstanding Options and SARs held by Eligible Participants shall become vested and exercisable, as provided in this Section 10. 
 (b) Cash Transaction. In the event of a Change of Control Transaction in which the consideration received in the transaction by holders of Shares is all or substantially all cash, all Unvested Shares shall
vest, and all Options and SARs shall be fully vested and exercisable. 
 (c) Stock Transaction. In the event of a Change of Control
Transaction in which the consideration received in the transaction by holders of Shares is all or substantially all shares of capital stock of the acquiring or successor corporation or its parent (or other securities or property), 50% of the
Unvested Shares subject to each grant of Shares shall vest, and 50% of the unvested portion of each Option and SAR shall vest and be exercisable, in addition to any portion of each that was previously vested and exercisable. Thereafter, the
remaining Unvested Shares subject to each grant, and the remaining unvested portion of each Option and SAR, shall continue to vest and become exercisable according to the vesting provisions of the applicable Grant Agreement. The preceding sentence
notwithstanding, all such remaining Unvested Shares shall be fully vested, and each such remaining unvested portion of an Option and SAR, shall be fully vested and exercisable, upon the earlier of (i) the date each would otherwise have become
fully vested (and exercisable, if applicable) pursuant to the vesting provisions of the applicable Grant Agreement or (ii) the date that is 12 months after the effective date of the Change of Control Transaction. 
 (d) Stock and Cash Transaction. In the event of a Change of Control Transaction in which the consideration received in the transaction by holders
of Shares is not described in Sections 10(b) or 10(c) above, the Committee shall determine the extent to which Unvested Shares and the unvested portions of Options and SARs shall be vested (and exercisable, if applicable), equitably in a manner
consistent with Sections 10(b) and 10(c) above, and shall make such other determinations with respect to Unvested Shares, Options and SARs as may be necessary or desirable. 
  

					
	Confidential to Biolex, Inc.	  	7	  	

 11. Restrictions on Shares. 
 (a) Restrictions on Issuing Shares. No Shares shall be issued or transferred to a Grantee under the Plan unless and until all applicable legal
requirements have been complied with to the satisfaction of the Committee. The Committee shall have the right to condition the award or delivery of Shares or exercise of any SAR or Option on the Grantee’s undertaking in writing to comply with
such restrictions on any subsequent disposition of the Shares issued or transferred thereunder as the Committee shall deem necessary or advisable as a result of any applicable law, regulation, official interpretation thereof, or any underwriting
agreement. 
 (b) Voting. As to the election of members of the Board, holders of Shares issued under the Plan shall vote, consent and
take such other action as to such Shares consistent with the provisions of any stockholders agreement that may be in effect from time to time among the Company and its stockholders, whether or not such holders of shares issued under the Plan are
parties thereto. 
 (c) Transfer of ISO Shares. Grantees shall notify the Company of any transfer of Shares that were acquired upon
exercise of an ISO that occurs within one year of such exercise or two years of the date the ISO was granted. 
 (d) IPO. Unless
otherwise determined by the Committee, no Shares shall be sold or distributed during the 180-day period beginning on the effective date of the IPO (except as part of such underwritten registration), and each Grantee shall enter into such standstill
agreements and related agreements as the managing underwriters of such IPO may request. 
 (e) Certificates for Shares. Shares issued
under the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing Shares are registered in the name of a Grantee, such certificates may bear appropriate legends referring to the terms, conditions, and
restrictions applicable to such Shares. The Company may retain physical possession of the certificates, in which case the Grantee shall be required to have delivered a power of transfer to the Company, endorsed in blank, relating to the Shares.

 12. General Provisions. 
 (a) Grant Agreement. Grants of Options, SARs and Shares granted under the Plan shall be evidenced by written Grant Agreements. The terms and provisions of such Grant Agreements may vary among Grantees and among different grants that
are granted to the same Grantee. 
 (b) No Right to Additional Grants; No Right to Continue as an Eligible Participant; No Rights as a
Stockholder. The grant of an Option, SAR or Shares in any year shall not give the Grantee any right to similar grants in future years, any right to continue such Grantee’s relationship as an Eligible Participant (for the applicable vesting
period or otherwise), or, until Shares are issued pursuant to the exercise of an Option or an SAR that is settled in stock, any rights as a stockholder of the Company. Grantees who are employees of the Company or a subsidiary shall remain subject to
discharge from employment to the same extent as if the Plan were not in effect. 
  

					
	Confidential to Biolex, Inc.	  	8	  	

 (c) No Segregation of Assets. No Grantee, and no beneficiary or other persons claiming under or
through the Grantee, shall have any right, title or interest by reason of any award under the Plan to any particular assets of the Company or subsidiaries of the Company, or any Shares allocated or reserved for the purposes of the Plan or subject to
any award except as set forth herein. The Company shall not be required to establish any fund or make any other segregation of assets to assure satisfaction of the Company’s obligations under the Plan. 
 (d) Governing Law. The Plan shall be governed by and construed in accordance with the laws of the State of North Carolina, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State of North Carolina or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of North Carolina. 
 13. Effective Date; Amendment or Termination. 
 The Plan shall become effective upon its adoption by the Board, subject to the approval of the stockholders of the Company within twelve (12) months thereafter. Shareholder approval shall be obtained in the manner and to the degree
required under applicable law and the Bylaws of the Company. The Board may, at any time, alter, amend, suspend, discontinue or terminate the Plan; provided, however, that no such action shall adversely affect the rights of Grantees with respect to
grants previously made hereunder. 
  

					
	Confidential to Biolex, Inc.	  	9

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