Document:

Exchange Agreement of the Registrant

 Exhibit 4.3 

AMENDED & RESTATED EXCHANGE AGREEMENT

This Amended & Restated Exchange Agreement is made as of March 19, 2013 

B E T W E E N: 
 AQUINOX
PHARMACEUTICALS INC., a corporation existing under the laws of Canada (the “Corporation”), 
 – and
– 
 AQUINOX PHARMACEUTICALS (USA) INC., a corporation existing under the laws of Delaware (“U.S.
Company”), 
 – and – 

THE HOLDERS OF SHARES in the capital of the Corporation or U.S. Company. 

RECITALS: 
 A. In connection with a reorganization
of the Corporation and a Series A financing of the Corporation and U.S. Company, the Corporation, U.S. Company and the holders of shares in the capital of the Companies entered into an exchange agreement dated June 8, 2007 (the
“Original Exchange Agreement”) in order to establish a procedure whereby the rights of holders of Common Exchangeable Shares, Series A-1 Exchangeable Shares and Series A-2 Exchangeable Shares to require U.S. Company (or a Permitted
Subsidiary) to purchase such shares from the holders thereof may be exercised. 
 B. In connection with a Series B financing of the Corporation and
U.S. Company pursuant to which the Corporation issued Series B-1 Exchangeable Shares and Series B-2 Exchangeable Shares of the Corporation, on March 31, 2010 the Corporation, U.S. Company and the holders of the Common Exchangeable Shares, the
Series A-1 Exchangeable Shares and the Series A-2 Exchangeable Shares amended the Original Exchange Agreement in order to establish a procedure whereby the rights of holders of Series B-1 Exchangeable Shares and Series B-2 Exchangeable Shares to
require U.S. Company (or a Permitted Subsidiary) to purchase such shares from the holders thereof may be exercised. 
 C. The Corporation and U.S. Company
propose to complete a Series C financing pursuant to which the Corporation shall issue Class C Exchangeable Shares. 
 D. U.S. Company is to grant to and in
favour of each holder from time to time of Class C Exchangeable Shares the right to require U.S. Company (or a Permitted Subsidiary) to purchase all or any part of the Class C Exchangeable Shares. 

 E. The Corporation and U.S. Company propose to amend and restate the Original Exchange Agreement as set forth
herein in order to, among other things, establish a procedure whereby the rights of holders of Class C Exchangeable Shares to require U.S. Company (or a Permitted Subsidiary) to purchase such shares from the holders thereof may be exercised. 

F. The proposed amendment and restatement of the Original Exchange Agreement, as amended on March 31, 2010, set forth herein has been approved by the
holders of the Common Exchangeable Shares, Series A-1 Exchangeable Shares, Series A-2 Exchangeable Shares, Series B-1 Exchangeable Shares and Series B-2 Exchangeable Shares as required by Section 3.1 of the Original Exchange Agreement. The
undersigned shareholders hold in the aggregate at least two-thirds of the Exchangeable Shares. 
 NOW THEREFORE in consideration of the covenants and
agreements provided in this Agreement and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties agree as follows: 

ARTICLE 1 
 DEFINITIONS
AND INTERPRETATION 
 1.1 Definitions 
 In this
Agreement, the following terms shall have the following meanings: 
 “Affiliate” of any Person means any other Person
directly or indirectly controlling, controlled by, or under common control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common
control with”), as applied to any Person, means the possession by another Person, directly or indirectly, of the power to direct or cause the direction of the management and policies of that first mentioned Person, whether through the ownership
of voting securities, by contract or otherwise, but for greater certainty a director or officer shall not be considered to be an Affiliate of a Person merely by acting in such capacity. 

“Agreement” means this Amended & Restated Exchange Agreement, as amended, supplemented or restated.

 “Automatic Exchange Rights” means the benefit of the obligation of U.S. Company or a Permitted Subsidiary to
effect the automatic exchange of Exchangeable Shares for shares of U.S. Company Shares pursuant to Section 2.11 or Section 2.12. 

“Board” means the board of directors of either of the Companies, as the case may be, and “Boards”
shall mean the boards of directors of both Companies. 
 “Business” has the meaning ascribed thereto in the
Shareholders’ Agreement. 
 “Business Day” means any day except a Saturday or Sunday, on which the Royal
Bank of Canada in Vancouver, British Columbia and the Bank of America in Seattle, Washington are both open for commercial banking business during normal banking hours.  

  
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 “Canadian Special Voting Shares” means the special voting shares in the
capital of the Corporation. 
 “Change of Control” means: 

 

	 	(a)	any acquisition of U.S. Company by means of merger, share exchange or other form of corporate reorganization in which the stockholders of U.S. Company immediately prior to such event do not hold a majority of the
outstanding shares or interest of (1) the surviving corporation or entity or (2) if the surviving or resulting corporation is a wholly owned Subsidiary of another corporation immediately following such merger or consolidation, the parent
corporation of such surviving or resulting corporation, and in which outstanding shares of U.S. Company are exchanged for securities or other consideration issued (or caused to be issued) by the acquiring corporation or its subsidiary (other than a
mere reincorporation transaction) or entity, or any transaction or series of related transactions to which U.S. Company is a party in which in excess of fifty percent (50%) of voting power in U.S. Company is transferred; 

 

	 	(b)	any sale or other disposition (or series of related sales or dispositions) of the outstanding stock of U.S. Company, in any transaction or series of transactions not contemplated by the preceding subparagraph (i), in
which the stockholders immediately prior to such event do not hold a majority of the outstanding stock of U.S. Company immediately after such event; 

  

	 	(c)	any sale, license, lease or disposition of all or substantially all of the assets of U.S. Company; 

  

	 	(d)	any discontinuance of the business activities of U.S. Company, and its affiliates, of a substantial and material extent and duration, provided that the determination of such discontinuance has been confirmed by the
affirmative vote or written consent of the holders of the Exchangeable Preferred Shares by Preferred Shareholder Approval (the date of such Preferred Shareholder Approval shall be deemed the effective date of such discontinuance for purposes of this
Agreement); or 

  

	 	(e)	any similar transaction as described in clauses (a) through (d) above as to the Corporation. 

“Class A Preferred Stock” means the Series A-1 Preferred Stock and Series A-2 Preferred Stock. 

“Class A Special Voting Stock” means the Series A-1 Special Voting Stock and the Series A-2 Special Voting Stock.

 “Class A Voting Stock” means the Class A Preferred Stock and the Class A Special Voting Stock.

  
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 “Class B Preferred Stock” means the Series B-1 Preferred Stock and Series
B-2 Preferred Stock. 
 “Class B Special Voting Stock” means the Series B-1 Special Voting Stock and the
Series B-2 Special Voting Stock. 
 “Class B Voting Stock” means the Class B Preferred Stock and the Class B
Special Voting Stock. 
 “Class C Exchangeable Shares” means the Class C exchangeable preferred shares in the capital
of the Corporation. 
 “Class C Subscription Agreement” means the stock subscription agreement dated March 19,
2013 between the Corporation, U.S. Company and certain purchasers of shares of Series C Preferred Stock of U.S. Company and certain purchasers of Class C Exchangeable Shares of the Corporation. 

“Closing Documents” has the meaning ascribed thereto in the Exchangeable Share Provisions. 

“Common Exchangeable Shares” means the common exchangeable shares in the capital of the Corporation, exchangeable for
U.S. Company Common Stock.  
 “Companies” means, collectively, the Corporation and U.S. Company and
“Company” shall mean either of them. 
 “Constating Documents” means the articles or certificate of
incorporation, continuance or amalgamation pursuant to which a corporation was incorporated, continued or amalgamated, as the case may be, together with any amendments thereto or replacements thereof, and the by-laws (if any) of such corporation.

 “Corporation Automatic Liquidation Event” has the meaning ascribed thereto in Section 2.12(a). 

“Corporation Automatic Liquidation Event Record Date” has the meaning ascribed thereto in Section 2.12(b). 

“Corresponding U.S. Company Shares” means, with respect to a class or series of Exchangeable Shares, the class or
series of U.S. Company Shares set out opposite such class or series of Exchangeable Shares in the list immediately below: 

  
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	 Class or Series of U.S. Company Shares
	  	 Class or Series of Exchangeable Shares

		
	 Common Shares
	  	Common Exchangeable Shares
		
	 Series A-1 Preferred Stock
	  	Series A-1 Exchangeable Shares
		
	 Series A-2 Preferred Stock
	  	Series A-2 Exchangeable Shares
		
	 Series B-1 Preferred Stock
	  	Series B-1 Exchangeable Shares
		
	 Series B-2 Preferred Stock
	  	Series B-2 Exchangeable Shares
		
	 Series C Preferred Stock
	  	Class C Exchangeable Shares

 and “Corresponding Exchangeable Shares”, “Corresponds” and
“Corresponding” shall have correlative meanings. 
 “Exchange Amount” has the meaning
ascribed thereto in the Exchangeable Share Provisions. 
 “Exchange Right” has the meaning ascribed thereto in
Section 2.1. 
 “Exchange Right Consideration” has the meaning ascribed thereto in Section 2.4. 

“Exchangeable Preferred Shares” means the Series A-1 Exchangeable Shares, Series A-2 Exchangeable Shares, Series B-1
Exchangeable Shares, Series B-2 Exchangeable Shares and Class C Exchangeable Shares. 
 “Exchangeable Share
Provisions” means the special rights and restrictions attaching to the Exchangeable Shares as set forth in the articles of incorporation of the Corporation. 

“Exchangeable Shares” means the Common Exchangeable Shares, Series A-1 Exchangeable Shares, Series A-2 Exchangeable
Shares, Series B-1 Exchangeable Shares, Series B-2 Exchangeable Shares and Class C Exchangeable Shares. 
 “Fully Converted
Basis” at any time means that all Shares then outstanding which are convertible or exchangeable (directly or indirectly) (including pursuant to this Agreement) into U.S. Company Common Stock at that time shall be deemed to have been fully
converted and exchanged into U.S. Company Common Stock, in accordance with the rights, privileges, restrictions and conditions attached thereto, and U.S. Company Common Stock issuable as a result thereof shall be deemed to have been issued and to
form part of the holdings of the Person(s) entitled to receive such U.S. Company Common Stock and assuming the redemption of all U.S. Company Special Voting Stock and Canadian Special Voting Shares in accordance with the rights, privileges,
restrictions and conditions attached thereto. For clarity, such basis does not include options or warrants that are exercisable or exchangeable (directly or indirectly) (including pursuant to this Agreement) into U.S. Company Common Stock.

  
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 “Holders” means the registered holders from time to time of Exchangeable
Shares or U.S. Company Shares other than U.S. Company and its Affiliates, including those holders who execute a counterpart to this Agreement in the form attached as Schedule A. 

“Incentive Compensation Plans/ESOPs” has the meaning ascribed thereto in the Shareholders’ Agreement. 

“Investor Approval” has the meaning ascribed thereto in the Shareholders’ Agreement. 

“Liquidation Event” has the meaning ascribed thereto in the Exchangeable Share Provisions. 

“Liquidation Call Right” has the meaning ascribed thereto in the Exchangeable Share Provisions. 

“Majority Approval” has the meaning ascribed thereto in Section 3.6(a). 

“Outstanding Dividend Amount” has the meaning ascribed thereto in the Exchangeable Share Provisions. 

“Permitted Subsidiary” means a Subsidiary of U.S. Company designated by U.S. Company to assume the obligations of U.S.
Company pursuant to the Exchange Right or the Automatic Exchange Rights.  
 “Person” means any individual,
corporation, firm, partnership (including a limited partnership), sole proprietorship, syndicate, joint venture, trustee, trust, any unincorporated organization or association, any government or instrumentality thereof and any tribunal; and pronouns
have a similar extended meaning. 
 “Preferred Shareholder Approval”, in respect of a matter, means that
shareholders holding at least 60% of the votes attaching to the Preferred Voting Stock then outstanding (voting together as a single class and not as separate series of stock) have approved of the matter by instrument in writing which describes the
matter approved. 
 “Preferred Voting Stock” means the Class A Voting Stock, Class B Voting Stock and
Series C Voting Stock. 
 “Redemption Call Right” has the meaning ascribed thereto in the Exchangeable Share
Provisions. 
 “Retracted Shares” has the meaning ascribed thereto in Section 2.7. 

“Retraction Call Right” has the meaning ascribed thereto in the Exchangeable Share Provisions. 

“Retraction Request” has the meaning ascribed thereto in the Exchangeable Share Provisions. 

  
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 “Series A Subscription Agreement” means the stock subscription agreement
dated June 8, 2007 between the Corporation, U.S. Company and certain purchasers of shares of Series A-1 Preferred Stock and Series A-2 Preferred Stock of U.S. Company and certain purchasers of Series A-1 Exchangeable Shares and Series A-2
Exchangeable Shares of the Corporation. 
 “Series A-1 Preferred Stock” means the Series A-1 Preferred Stock in the
capital of U.S. Company. 
 “Series A-1 Special Voting Stock” means the Series A-1 Special Voting Stock in the capital of
U.S. Company. 
 “Series A-2 Preferred Stock” means the Series A-2 Preferred Stock in the capital of U.S. Company. 

“Series A-2 Special Voting Stock” means the Series A-2 Special Voting Stock in the capital of U.S. Company. 

“Series B Exchangeable Shares” means the Series B-1 Exchangeable Shares and Series B-2 Exchangeable Shares in the
capital of the Corporation. 
 “Series B Subscription Agreements” means the stock subscription agreements
dated March 31, 2010 and June 14, 2010 between the Corporation, U.S. Company and certain purchasers of shares of Series B-1 Preferred Stock and Series B-2 Preferred Stock of U.S. Company and certain purchasers of Series B-1 Exchangeable
Shares and Series B-2 Exchangeable Shares of the Corporation. 
 “Series B-1 Preferred Stock” means the Series B-1
Preferred Stock in the capital of U.S. Company. 
 “Series B-1 Special Voting Stock” means the Series B-1 Special Voting
Stock in the capital of U.S. Company. 
 “Series B-2 Preferred Stock” means the Series B-2 Preferred Stock in the capital of
U.S. Company. 
 “Series B-2 Special Voting Stock” means the Series B-2 Special Voting Stock in the capital of U.S. Company.

 “Series C Preferred Stock” means the Series C Preferred Stock in the capital of U.S. Company. 

“Series C Special Voting Stock” means the Series C Special Voting Stock in the capital of U.S. Company. 

“Series C Voting Stock” means the Series C Preferred Stock and the Series C Special Voting Stock. 

  
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 “Shareholders’ Agreement” means the Amended & Restated
Shareholders’ Agreement dated the date hereof between the Corporation, U.S. Company and certain shareholders of the Companies, as such agreement may be amended, supplemented or restated from time to time. 

“Shares” means any shares in the capital of the Corporation or U.S. Company. 

“Stock Option Plans” means the stock option plans established and approved by either or both of the Boards. 

“Stock Sale” has the meaning ascribed thereto in Section 3.6(c). 

“Subscription Agreements” means the Series A Subscription Agreement, the Series B Subscription Agreements and the Class
C Subscription Agreement. 
 “Subsidiary” has the meaning set forth in the Canada Business
Corporations Act and includes all indirect subsidiaries.  
 “Support Agreement” means the
Amended & Restated Support Agreement dated the date hereof between the Corporation and U.S. Company, as such agreement may be amended, supplemented or restated from time to time. 

“Transfer” includes any sale, exchange, assignment, gift, bequest, disposition, mortgage, charge, pledge, encumbrance,
grant of a security interest or other arrangement by which possession, legal title or beneficial ownership passes from one Person to another, or to the same Person in a different capacity, whether or not voluntarily and whether or not for value, and
any agreement to effect any of the foregoing; and the words “Transferred”, “Transferring” and similar words have corresponding meanings; provided, however, that “Transfer”, “Transferred” and
“Transferring” and similar words shall not include the exchange or redemption of any Exchangeable Shares or U.S. Company Special Voting Stock under the terms of this Agreement or the constating documents of the Corporation or U.S.
Company. 
 “U.S. Company Common Special Voting Stock” means the common special voting stock in the capital of
U.S. Company, having a par value of U.S. $0.000001 per share. 
 “U.S. Company Common Stock” means the shares of
common stock in the capital of U.S. Company, having a par value of U.S. $0.000001 per share. 
 “U.S. Company Liquidation
Event” has the meaning ascribed thereto in Section 2.11(a). 
 “U.S. Company Liquidation Event Record Date”
has the meaning ascribed thereto in Section 2.11(b). 
 “U.S. Company Preferred Stock” means the U.S. Company Shares
other than the U.S. Company Common Stock. 

  
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 “U.S. Company Shares” means shares of the U.S. Company Common Stock and shares
of the Series A-1 Preferred Stock, Series A-2 Preferred Stock, Series B-1 Preferred Stock, Series B-2 Preferred Stock and Series C Preferred Stock of U.S. Company and any securities into which such shares may be changed. 

“U.S. Company Special Voting Stock” means shares of the U.S. Company Common Special Voting Stock and shares of the Series A-1
Special Voting Stock, Series A-2 Special Voting Stock, Series B-1 Special Voting Stock, Series B-2 Special Voting Stock and Series C Special Voting Stock of U.S. Company and any securities into which such shares may be changed. 

1.2 Interpretation Not Affected by Headings, etc. 
 The
division of this Agreement into Articles, sections and other portions and the insertion of headings are for convenience of reference only and do not affect the construction or interpretation of this Agreement. Unless otherwise indicated, all
references to an “Article” or “Section” followed by a number and/or a letter refer to the specified Article or Section of this Agreement. The terms “this Agreement”, “hereof”, “herein” and
“hereunder” and similar expressions refer to this Agreement and not to any particular Article, Section or other portion hereof and include any agreement or instrument supplementary or ancillary hereto. 

1.3 Number, Gender, etc. 
 Words importing the
singular number only shall include the plural and vice versa. Words importing any gender shall include all genders.  
 1.4 Date for any
Action 
 If any date on which any action is required to be taken under this Agreement is not a Business Day, such action shall be required to be taken
on the next succeeding Business Day. 
 ARTICLE 2 

EXCHANGE RIGHT AND AUTOMATIC EXCHANGE 

2.1 Grant and Ownership of the Exchange Right 

U.S. Company hereby grants to the Holders (a) the right (the “Exchange Right”) to require U.S. Company or, at the option of U.S.
Company, a Permitted Subsidiary, upon the occurrence and during the continuance of any (i) Liquidation Event or (ii) failure of the Corporation by reason other than a Liquidation Event to purchase the Retracted Shares pursuant to a duly
completed and delivered Retraction Request, to purchase from each or any Holder, at any time and from time to time, all or any part of the Exchangeable Shares held by such Holders and (b) the Automatic Exchange Rights, all in accordance with
the provisions of this Agreement. U.S. Company hereby acknowledges receipt from the Holders of good and valuable consideration (and the adequacy thereof) for the grant of the Exchange Right and the Automatic Exchange Rights by U.S. Company to the
Holders.  

  
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 2.2 Share Certificates 

The Corporation will cause each certificate representing Exchangeable Shares to bear an appropriate legend notifying the Holders of (a) their right to
exercise the Exchange Right in respect of the Exchangeable Shares and (b) the Automatic Exchange Rights. 
 2.3 General Exercise of Exchange Right

 The Exchange Right shall be and remain vested in and may be exercised by each Holder in respect of the Exchangeable Shares held by such Holder. 

2.4 Purchase Price 
 The purchase price payable by
U.S. Company or a Permitted Subsidiary for each Exchangeable Share to be exchanged by U.S. Company or a Permitted Subsidiary under the Exchange Right shall be an amount per share equal to the Exchange Amount, which amount shall be paid and satisfied
by U.S. Company or a Permitted Subsidiary delivering to each Holder one Corresponding U.S. Company Share for each Exchangeable Share held plus an amount per Exchangeable Share equal to the Outstanding Dividend Amount on such Exchangeable Share on
the date of such exchange (the “Exchange Right Consideration”). 
 2.5 Exercise Instructions 

Subject to the terms and conditions herein set forth, a Holder shall be entitled, upon the occurrence and during the continuance of any event as
provided by paragraphs 2.1(a)(i) or (ii), to exercise the Exchange Right with respect to all or any part of the Exchangeable Shares registered in the name of such Holder on the books of the Corporation. To exercise the Exchange Right, the Holder
shall deliver to the Corporation, in person or by certified or registered mail the certificates representing the Exchangeable Shares which such Holder desires U.S. Company or a Permitted Subsidiary to purchase, duly endorsed in blank, and
accompanied by such other documents and instruments as may be required to effect a transfer of Exchangeable Shares under the Canada Business Corporations Act and the by-laws of the Corporation and such additional documents and instruments as
the Corporation may reasonably require together with:  
  

	 	(a)	a written notice of exercise of the Exchange Right attached to the Exchangeable Share certificates, stating (i) that the Holder thereby exercises the Exchange Right so as to require U.S. Company or, at the option
of U.S. Company, a Permitted Subsidiary to exchange the number of Exchangeable Shares specified therein, (ii) that such Holder has good title to and owns all such Exchangeable Shares to be acquired by U.S. Company or a Permitted Subsidiary free
and clear of all liens, claims and encumbrances (other than resale restrictions arising under applicable securities laws), (iii) that such Holder is not a non-resident of Canada for the purposes of the Income Tax Act (Canada),
(iv) the names in which the certificates representing U.S. Company Shares issuable in connection with the exercise of the Exchange Right are to be issued and (v) the names and addresses of the person to whom such new certificates should be
delivered; and 

  
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	 	(b)	payment (or evidence satisfactory to U.S. Company or the Permitted Subsidiary, as the case may be, and the Corporation of payment) of the taxes (if any) payable as contemplated by Section 2.8 of this Agreement.

 Delivery of such written notice of exercise together with the other required documents and instruments described above shall constitute the
exercise of the Exchange Right on the Holders’ part. If only a part of the Exchangeable Shares represented by any certificate or certificates are to be exchanged by U.S. Company or a Permitted Subsidiary under the Exchange Right, a new
certificate for the balance of such Exchangeable Shares shall be issued to the Holder. 
 2.6 Delivery of Exchange Right Consideration; Effect of
Exercise 
 Promptly after receipt by the Corporation of the certificate representing the Exchangeable Shares which the Holder desires U.S. Company or a
Permitted Subsidiary to purchase under the Exchange Right (together with such documents and instruments of transfer and a written notice of exercise of the Exchange Right (and payment of taxes, if any, or evidence thereof)), duly endorsed for
transfer to U.S. Company or a Permitted Subsidiary, the Corporation shall notify U.S. Company of its receipt of same and U.S. Company shall as soon as reasonably practical thereafter: 

 

	 	(a)	notify the Corporation as to whether U.S. Company or a Permitted Subsidiary will discharge the obligations of U.S. Company pursuant to the Exchange Right; and 

 

	 	(a)	deliver or cause to be delivered to the Holder (or to such other persons, if any, properly designated by the Holder) (i) the number of Corresponding U.S. Company Shares issuable in connection with the exercise of
the Exchange Right, which shares shall, when issued and delivered against the surrender of the applicable Closing Documents, be duly issued, fully paid and non-assessable and shall be free and clear of any lien, claim or encumbrance, and
(ii) cheques for the balance, if any, of the total Exchange Right Consideration therefor without interest less any tax required to be deducted or withheld from the total Exchange Right Consideration by U.S. Company or the Permitted Subsidiary,
provided, however, that no such delivery shall be made unless and until the Holder requesting the same shall have paid (or provided evidence satisfactory to U.S. Company or the Permitted Subsidiary, as the case may be, and the Corporation of the
payment of) the taxes, if any, payable as contemplated by Section 2.8 of this Agreement. 

 Immediately upon the giving of notice by the
Corporation to U.S. Company of the exercise of the Exchange Right, as provided in this Section 2.6, the exchange shall be deemed to have occurred, and the holder of such Exchangeable Shares shall be deemed to have transferred to U.S. Company or the
Permitted Subsidiary all of its right, title and interest in and to such Exchangeable Shares and shall cease to be a holder of such Exchangeable Shares and shall not be entitled to exercise any of the rights of a Holder in respect thereof, other
than the right to receive the Exchange Right Consideration therefor, unless the requisite number of Corresponding U.S. Company Shares (together with a cheque for the balance, if any, of the total Exchange Right Consideration therefor without
interest less any tax required to be deducted or withheld from the total Exchange Right Consideration by U.S. Company or the Permitted Subsidiary) is not allotted, issued and delivered by U.S. Company or the Permitted Subsidiary to such Holder (or
to such other persons, if any, properly 

  
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designated by such Holder), within five (5) Business Days of the date of the exercise of the Exchange Right, in which case the rights of the Holder as a holder of Exchangeable Shares shall
remain unaffected until such Corresponding U.S. Company Shares are so allotted, issued and delivered by U.S. Company or the Permitted Subsidiary and any such cheque is so delivered and paid. Concurrently with such Holder ceasing to be a holder of
Exchangeable Shares, the Holder shall be considered and deemed for all purposes to be the holder of the Corresponding U.S. Company Shares delivered to it pursuant to the Exchange Right. 

2.7 Exercise of Exchange Right Subsequent to Retraction 

If a Holder has exercised its rights under Article 6 of the Exchangeable Share Provisions to require the Corporation to redeem any or all of the Exchangeable
Shares held by the Holder (the “Retracted Shares”) and is notified by the Corporation pursuant to Section 6.6 of the Exchangeable Share Provisions that the Corporation will not be permitted, as a result of the solvency
requirement, other provisions of applicable law or other restrictions specified in Section 6.6 of the Exchangeable Share Provisions, to redeem all such Retracted Shares, then, provided that neither U.S. Company nor a Permitted Subsidiary shall
have exercised the Retraction Call Right with respect to the Retracted Shares and further provided that the Holder has not revoked the retraction request delivered by the Holder to the Corporation pursuant to Section 6.8 of the Exchangeable
Share Provisions, the Retraction Request will constitute and will be deemed to constitute notice from the Holder of the exercise of the Exchange Right with respect to those Retracted Shares which the Corporation is unable to redeem. In any such
event, the Corporation hereby agrees to immediately notify the Holder of such prohibition against the Corporation redeeming all of the Retracted Shares. 

Without in any way limiting the Exchange Right or Automatic Exchange Rights and notwithstanding Section 6.6(b) of the Exchangeable Share
Provisions, the Corporation agrees to redeem in accordance with the Exchangeable Share Provisions the Retracted Shares specified in a Retraction Request given at any time by a Holder, provided that neither U.S. Company nor a Permitted Subsidiary
shall have exercised the Retraction Call Right with respect to such Retracted Shares, the redemption of the Retracted Shares would not be contrary to solvency requirements or any other provision of applicable law (other than Section 6.6(b) of
the Exchangeable Share Provisions) and that the Holder is not an “eligible investor”, as defined in the Small Business Venture Capital Act (British Columbia), as amended or substituted from time to time, that has invested in the
Corporation in connection with an approval granted under Part II of such Act. 
 2.8 Stamp or Other Transfer Taxes 

Upon any exchange of Exchangeable Shares pursuant to the Exchange Right or the Automatic Exchange Rights, the share certificate or certificates representing
Corresponding U.S. Company Shares to be delivered in connection with the payment of the total consideration therefor shall be issued in the name of the holder of the Exchangeable Shares so exchanged or in such names as such Holder may otherwise
direct in writing without charge to the holder of the Exchangeable Shares so sold, provided, however, that such Holder (a) shall pay (and none of U.S. Company, any Permitted Subsidiary or the Corporation shall be required to pay) any
documentary, stamp, transfer or other similar taxes that may be payable in respect of any transfer involved in the issuance or delivery of such shares to a person other than such Holder or (b) shall have established to the satisfaction of U.S.
Company or the Permitted Subsidiary, as the case may be, and the Corporation that such taxes, if any, have been paid. 

  
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 2.9 Reservation of U.S. Company Shares 

U.S. Company hereby represents, warrants and covenants that it has reserved for issuance and will at all times keep available, free from pre-emptive and other
rights, out of its authorized and unissued capital stock, such number of U.S. Company Shares as are now and may hereafter be required to enable and permit U.S. Company, any Permitted Subsidiary and the Corporation to meet their obligations
hereunder, under the Support Agreement and under the Exchangeable Share Provisions (including, without limitation, U.S. Company’s obligation to issue U.S. Company Common Stock on the conversion of the U.S. Company Preferred Stock issuable on
the redemption, retraction or exchange of the Exchangeable Shares). 
 2.10 Notice of Liquidation Event 

As soon as practicable following the occurrence of any event that, with the giving of notice or the passage of time or both, would be a Liquidation Event, the
Corporation shall give written notice thereof to U.S. Company. As soon as practicable following the receipt of notice from the Corporation of the occurrence of a Liquidation Event, or upon U.S. Company becoming aware of a Liquidation Event, U.S.
Company shall provide written notice to each Holder of such Liquidation Event, which written notice shall contain a brief statement of the rights of the Holders with respect to the Exchange Right. 

2.11 Automatic Exchange on Liquidation of U.S. Company 
  

	 	(a)	Each of the following events shall give rise to the automatic exchange of the Exchangeable Shares as provided in this Section 2.11 (each, a “U.S. Company Liquidation Event”): 

 

	 	(i)	any determination by the board of directors of U.S. Company to institute voluntary liquidation, dissolution or winding-up proceedings with respect to U.S. Company or to effect any other distribution of assets of U.S.
Company among its stockholders for the purpose of winding up its affairs; and 

  

	 	(ii)	upon the earlier of U.S. Company receiving notice, or otherwise becoming aware, of any instituted claim, suit, petition or other proceedings with respect to the involuntary liquidation, dissolution or winding up of U.S.
Company or to effect any other distribution of assets of U.S. Company among its stockholders for the purpose of winding up its affairs. 

  

	 	(b)	U.S. Company will give the Holders written notice of a U.S. Company Liquidation Event described in Section 2.11(a) or any threatened U.S. Company Liquidation Event of which U.S. Company is aware at least twenty
(20) days prior to the record date or other relevant date for determining the eligibility of holders of U.S. Company Shares to participate as shareholders in respect of such U.S. Company Liquidation Event (the “U.S. Company Liquidation
Event Record Date”). Such notice shall include a brief description of the automatic exchange of Exchangeable Shares for U.S. Company Shares provided for in Section 2.11(c). 

  
 - 13 - 

	 	(c)	In order that the holders of Exchangeable Shares will be able to participate on a pro rata basis with the holders of Corresponding U.S. Company Shares in the distribution of assets of U.S. Company in connection with a
U.S. Company Liquidation Event, on the fifth Business Day prior to the U.S. Company Liquidation Event Record Date, all of the then outstanding Exchangeable Shares shall be automatically exchanged for U.S. Company Shares. To effect such automatic
exchange, U.S. Company or a Permitted Subsidiary and the Holder shall exchange each Exchangeable Share outstanding on the fifth Business Day prior to the U.S. Company Liquidation Event Record Date and held by such Holder for consideration per share
equal to the Exchange Amount, by delivering to such Holder one Corresponding U.S. Company Share for each Exchangeable Share held plus an amount per Exchangeable Share equal to the Outstanding Dividend Amount on such Exchangeable Share.

  

	 	(d)	On the fifth Business Day prior to the U.S. Company Liquidation Event Record Date, the closing of the automatic exchange of Exchangeable Shares for Corresponding U.S. Company Shares shall be deemed to have occurred, and
each holder of Exchangeable Shares shall be deemed to have transferred to U.S. Company or a Permitted Subsidiary all of the Holder’s right, title and interest in and to such Exchangeable Shares and shall cease to be a holder of such
Exchangeable Shares and U.S. Company or the Permitted Subsidiary shall deliver to the Holder the Corresponding U.S. Company Shares deliverable upon the automatic exchange of Exchangeable Shares for U.S. Company Shares and shall deliver to the Holder
a cheque for the balance, if any, of the total Outstanding Dividend Amount for such Exchangeable Shares without interest. Concurrently with such Holder ceasing to be a holder of Exchangeable Shares, the Holder shall be considered and deemed for all
purposes to be the holder of the U.S. Company Shares delivered to it pursuant to the automatic exchange of Exchangeable Shares for U.S. Company Shares and the certificates held by the Holder previously representing the Exchangeable Shares exchanged
by the Holder with U.S. Company or a Permitted Subsidiary pursuant to such automatic exchange shall thereafter be deemed to represent the U.S. Company Shares delivered to the Holder by U.S. Company or the Permitted Subsidiary pursuant to such
automatic exchange. Upon the request of a Holder and the surrender by the Holder of Exchangeable Share certificates deemed to represent U.S. Company Shares, duly endorsed in blank and accompanied by such instruments of transfer as U.S. Company or
the Permitted Subsidiary may reasonably require, U.S. Company or the Permitted Subsidiary shall deliver or cause to be delivered to the Holder certificates representing the U.S. Company Shares representing the Exchange Right Consideration in respect
of such Exchangeable Shares. 

  
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 2.12 Automatic Exchange on Liquidation of the Corporation 

 

	 	(a)	Each of the following events shall give rise to the automatic exchange of the Exchangeable Shares as provided in this Section 2.12 (each, a “Corporation Automatic Liquidation Event”): 

 

	 	(i)	any determination by the board of directors of the Corporation to institute voluntary liquidation, dissolution or winding-up proceedings with respect to the Corporation or to effect any other distribution of assets of
the Corporation among its shareholders for the purpose of winding up its affairs; and 

  

	 	(ii)	upon the earlier of the Corporation receiving notice, or otherwise becoming aware, of any instituted claim, suit, petition or other proceedings with respect to the involuntary liquidation, dissolution or winding up of
the Corporation or to effect any other distribution of assets of the Corporation among its shareholders for the purpose of winding up its affairs. 

  

	 	(b)	The Corporation will give the Holders written notice of a Corporation Automatic Liquidation Event described in Section 2.12(a) or any threatened Corporation Automatic Liquidation Event of which the Corporation is aware
at least twenty (20) days prior to the record date or other relevant date for determining the eligibility of holders of Exchangeable Shares to participate as shareholders in respect of such Corporation Automatic Liquidation Event (the
“Corporation Automatic Liquidation Event Record Date”). Such notice shall include a brief description of the automatic exchange of Exchangeable Shares for U.S. Company Shares provided for in Section 2.12(c). 

 

	 	(c)	On the fifth Business Day prior to the Corporation Automatic Liquidation Event Record Date, all of the then outstanding Exchangeable Shares shall be automatically exchanged for U.S. Company Shares. To effect such
automatic exchange, U.S. Company or a Permitted Subsidiary and the Holder shall exchange each Exchangeable Share outstanding on the fifth Business Day prior to the Corporation Automatic Liquidation Event Record Date and held by such Holder for
consideration per share equal to the Exchange Amount, by delivering to such Holder one Corresponding U.S. Company Share for each Exchangeable Share held plus an amount per Exchangeable Share equal to the Outstanding Dividend Amount on such
Exchangeable Share. 

  

	 	(d)	 On the fifth Business Day prior to the Corporation Automatic Liquidation Event Record Date, the closing of the automatic exchange of Exchangeable
Shares for Corresponding U.S. Company Shares shall be deemed to have occurred, and each holder of Exchangeable Shares shall be deemed to have transferred to U.S. Company or a Permitted Subsidiary all of the Holder’s right, title and interest in
and to such Exchangeable Shares and shall cease to be a holder of such Exchangeable Shares and U.S. Company or the Permitted Subsidiary shall deliver to the Holder the Corresponding U.S. Company Shares deliverable upon the automatic exchange of
Exchangeable Shares for U.S. Company Shares and shall deliver to the Holder a 

  
 - 15 - 

	 	
cheque for the balance, if any, of the total Outstanding Dividend Amount for such Exchangeable Shares without interest. Concurrently with such Holder ceasing to be a holder of Exchangeable
Shares, the Holder shall be considered and deemed for all purposes to be the holder of the U.S. Company Shares delivered to it pursuant to the automatic exchange of Exchangeable Shares for U.S. Company Shares and the certificates held by the Holder
previously representing the Exchangeable Shares exchanged by the Holder with U.S. Company or a Permitted Subsidiary pursuant to such automatic exchange shall thereafter be deemed to represent the U.S. Company Shares delivered to the Holder by U.S.
Company or the Permitted Subsidiary pursuant to such automatic exchange. Upon the request of a Holder and the surrender by the Holder of Exchangeable Share certificates deemed to represent U.S. Company Shares, duly endorsed in blank and accompanied
by such instruments of transfer as U.S. Company or the Permitted Subsidiary may reasonably require, U.S. Company or the Permitted Subsidiary shall deliver or cause to be delivered to the Holder certificates representing the U.S. Company Shares
representing the Exchange Right Consideration in respect of such Exchangeable Shares. 

 2.13 Withholding Rights 

The Corporation, U.S. Company and any Permitted Subsidiary shall be entitled to deduct and withhold from any dividend or consideration otherwise payable to a
holder of Exchangeable Shares (whether pursuant to this Agreement, the Exchangeable Share Provisions or otherwise) such amounts as the Corporation, U.S. Company or the Permitted Subsidiary is required to deduct and withhold with respect to such
payment under the Income Tax Act (Canada), the United States Internal Revenue Code of 1986 or any provincial, state, local or foreign tax law, in each case, as amended. To the extent that amounts are so withheld, such withheld amounts shall
be treated for all purposes hereof as having been paid to the Holder of the Exchangeable Shares in respect of which such deduction and withholding was made, provided that such withheld amounts are actually remitted to the appropriate taxing
authority. 
 ARTICLE 3 

AMENDMENTS AND TRANSFERS 
 3.1
Amendments, Modifications, etc. 
 This Agreement may not be amended or modified except by an agreement in writing executed by U.S. Company and the
Corporation and, unless such amendment is contemplated in Sections 11.2(a), (b) or (c) of the Exchangeable Share Provisions, approved by the holders of Exchangeable Shares in accordance with Section 10.2 of the Exchangeable Share
Provisions. 
 3.2 Changes in Capital of U.S. Company and the Corporation 

At all times after the occurrence of any event contemplated pursuant to Section 3.2 of the Support Agreement or otherwise, as a result of which U.S.
Company Shares or the Exchangeable Shares are in any way changed, this Agreement shall forthwith be amended and modified as necessary in order that it shall apply with full force and effect, mutatis mutandis, to all new securities into which
U.S. Company Shares or the Exchangeable Shares are so changed and the parties hereto shall execute and deliver a supplemental agreement giving effect to and evidencing such necessary amendments and modifications. 

  
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 3.3 Meeting to Consider Amendments 

The Corporation, at the request of U.S. Company, shall call a meeting or meetings of the holders of the Exchangeable Shares for the purpose of considering any
proposed amendment or modification requiring approval pursuant to this Article 3. Any such meeting or meetings shall be called and held in accordance with the by-laws of the Corporation, the Exchangeable Share Provisions and all applicable laws.

 3.4 Transfer Restriction 
 Notwithstanding any other
provision of this Agreement: 
  

	 	(a)	no Exchangeable Shares may be Transferred unless an equal number of Canadian Special Voting Shares and an equal number of shares of: 

 

	 	(i)	U.S. Company Common Special Voting Stock, if the Exchangeable Shares proposed to be Transferred are Common Exchangeable Shares; 

  

	 	(ii)	Series A-1 Special Voting Stock, if the Exchangeable Shares proposed to be Transferred are Series A-1 Exchangeable Shares; 

  

	 	(iii)	Series A-2 Special Voting Stock , if the Exchangeable Shares proposed to be Transferred are Series A-2 Exchangeable Shares; 

  

	 	(iv)	Series B-1 Special Voting Stock, if the Exchangeable Shares proposed to be Transferred are Series B-1 Exchangeable Shares; 

  

	 	(v)	Series B-2 Special Voting Stock, if the Exchangeable Shares proposed to be Transferred are Series B-2 Exchangeable Shares; and 

  

	 	(vi)	Series C Special Voting Stock, if the Exchangeable Shares proposed to be Transferred are Class C Exchangeable Shares 

are concurrently Transferred to the transferee; 
  

	 	(b)	no shares of Class A Preferred Stock, Class B Preferred Stock, Series C Preferred Stock or U.S. Company Common Stock may be Transferred unless an equal number of Canadian Special Voting Shares are concurrently
Transferred to the transferee; 

  

	 	(c)	no Canadian Special Voting Shares may be Transferred unless the transferor complies with paragraph (a) or (b) above; 

  

	 	(d)	no Exchangeable Shares or U.S. Company Shares may be Transferred unless, in addition to such Transfer complying with paragraphs (a), (b) and (c), the transferee enters into this Agreement by executing a counterpart to
this Agreement in the form attached as Schedule A; and 

  
 - 17 - 

	 	(e)	no Exchangeable Shares may be issued by the Corporation, and no U.S. Company Shares may be issued by U.S. Company, unless the person to whom such shares are issued enters into this Agreement by executing a counterpart
to this Agreement in the form attached as Schedule A. 

 3.5 Options to Purchase Special Voting Shares 

 

	 	(a)	Each Holder hereby grants an option to U.S. Company to purchase, at a price of $0.000001 per share, at any time: 

  

	 	(i)	the number of shares of U.S. Company Common Special Voting Stock held by such Holder at that time that is greater than the number of Common Exchangeable Shares held by such Holder at that time; 

 

	 	(ii)	the number of shares of Series A-1 Special Voting Stock held by such Holder at that time that is greater than the number of Series A-1 Exchangeable Shares held by such Holder at that time; 

 

	 	(iii)	the number of shares of Series A-2 Special Voting Stock held by such Holder at that time that is greater than the number of Series A-2 Exchangeable Shares held by such Holder at that time; 

 

	 	(iv)	the number of shares of Series B-1 Special Voting Stock held by such Holder at that time that is greater than the number of Series B-1 Exchangeable Shares held by such Holder at that time; 

 

	 	(v)	the number of shares of Series B-2 Special Voting Stock held by such Holder at that time that is greater than the number of Series B-2 Exchangeable Shares held by such Holder at that time; and 

 

	 	(vi)	the number of shares of Series C Special Voting Stock held by such Holder at that time that is greater than the number of Class C Exchangeable Shares held by such Holder at that time. 

 

	 	(b)	Each Holder hereby grants an option to the Corporation to purchase, at a price of US$0.000001 per share, at any time, the number of Canadian Special Voting Shares held by such Holder at that time that is greater than
the aggregate number of shares of U.S. Company Common Stock that would be held by such Holder if all of the U.S. Company Shares and Exchangeable Shares held by such Holder at that time were converted into or exchanged for U.S. Company Common Stock.

  

	 	(c)	 The options granted pursuant to Sections 3.5(a) and (b) may be exercised by U.S. Company or the Corporation, as the case may be, by giving at least
two Business Days’ notice to the Holder of its intention to exercise the option. Such notice must be 

  
 - 18 - 

	 	
accompanied by payment of the purchase price for the shares in respect of which the option is being exercised. Upon receipt of such payment, the Holder is deemed to have ceased to be a holder of
the shares acquired pursuant to the exercise of the option and has no right to exercise the votes in respect of such shares. Within two Business Days following receipt of such notice and payment, the Holder will surrender to U.S. Company or the
Corporation, as the case may be, the certificates representing the shares in respect of which the option has been exercised. If any Holder fails to deliver such certificates, the Secretary of U.S. Company is deemed to be irrevocably appointed as the
true and lawful attorney for such Holder with authority to do all things and execute and deliver, on behalf of and in the name of such Holder, such deeds, transfers, consents, resolutions, share certificates or other documents as may be necessary or
desirable to complete the sale of shares contemplated in this Section 3.5, and the Holder will have no claim or cause of action against any party to this Agreement or against any third party, as a result of the Secretary of U.S. Company so
acting as its attorney, such appointment and power of attorney, being coupled with an interest, is not revoked by the insolvency or bankruptcy of the Holder, and each Holder hereby ratifies and confirms all that the Secretary of U.S. Company may
lawfully do or cause to be done by virtue of such appointment and power. 

  

	 	(d)	The Corporation hereby grants an option to each Holder to subscribe for and purchase, at a price of US$0.000001 per share, at any time, the number of Canadian Special Voting Shares that, when added to the number of
Canadian Special Voting Shares held by such Holder at that time, is equal to the aggregate number of shares of U.S. Company Common Stock that would be held by such Holder if all of the U.S. Company Preferred Stock and Exchangeable Shares held by
such Holder at that time were converted into or exchanged for U.S. Company Common Stock. Such option is deemed to be exercised, with no further act of the Holder, and the Corporation will forthwith issue the Canadian Special Voting Shares to such
Holder, at any time that the number of Canadian Special Voting Shares held by such Holder is less than the number of shares of U.S. Company Common Stock that would be held by such Holder if all of the U.S. Company Preferred Stock and Exchangeable
Shares held by such Holder at that time were converted into or exchanged for U.S. Company Common Stock. At the time of such deemed exercise, the Corporation will notify U.S. Company of such exercise, and U.S. Company will, on behalf of the Holder,
pay to the Corporation the exercise price. Upon receipt of payment of the exercise price, the Corporation will issue to the Holder the Canadian Special Voting Shares upon such deemed exercise. 

3.6 Drag-Along 
  

	 	(a)	Subject to this Section 3.6, if Holders holding not less than two-thirds (2/3) of the U.S. Company Common Stock on a Fully Converted Basis (voting together as a single class) approve (“Majority
Approval”) a Change of Control transaction, whether at a meeting of Holders, by written consent in lieu of a meeting of Holders or by the tender of their shares, then all Holders shall be obligated to: 

  
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	 	(i)	vote all Shares held by the Holders in favour of such transaction; 

  

	 	(ii)	sell, transfer or exchange all of the Shares held by the Holders in connection with such transaction on the same terms as those approved by Majority Approval; and 

 

	 	(iii)	execute and deliver such instruments of conveyance and transfer and take such other action, including executing any purchase agreement, merger agreement, indemnity agreement, escrow agreement or related documents, as
may be reasonably required by the Corporation or U.S. Company in order to carry out the terms and provisions of this Section 3.6. 

  

	 	(b)	The obligations of the Holders set forth in this Section 3.6 shall apply with respect to a particular Holder for any proposed Change of Control transaction only if: 

 

	 	(i)	the liability for indemnification, if any, of such Holder in the proposed Change of Control transaction and for the inaccuracy of any representations and warranties made by the Corporation or U.S. Company in connection
with such proposed Change of Control transaction, is several and not joint with any other person, and is pro rata in proportion to the amount of consideration paid to such Holder in connection with such proposed Change of Control transaction (in
accordance with the provisions of U.S. Company certificate of incorporation); 

  

	 	(ii)	such Holder’s indemnification obligations under a proposed Change of Control transaction would not exceed the proceeds actually paid to such Holder with respect to such proposed Change of Control transaction,
except with respect to claims related to fraud by such Holder, the liability for which need not be limited as to such Holder; 

  

	 	(iii)	any representations and warranties to be made by such Holder in connection with the proposed Change of Control transaction are limited to representations and warranties related to authority, ownership and the ability to
convey title to such Shares, including but not limited to representations and warranties that (A) the Holder holds all right, title and interest in and to the Shares such Holder purports to hold, free and clear of all liens and encumbrances,
(B) the obligations of the Holder in connection with the transaction have been duly authorized, if applicable, (C) the documents to be entered into by the Holder have been duly executed by the Holder and delivered to the acquirer and are
enforceable against the Holder in accordance with their respective terms and (D) neither the execution and delivery of documents to be entered into in connection with the transaction, nor the performance of the Holder’s obligations
thereunder, will cause a breach or violation of the terms of any agreement, law or judgment, order or decree of any court or governmental agency; 

  
 - 20 - 

	 	(iv)	the Holder shall not be liable for the inaccuracy of any representation or warranty made by any other person in connection with the proposed Change of Control transaction, other than the Corporation or U.S. Company;

  

	 	(v)	upon the consummation of the proposed Change of Control transaction, (A) each holder of each series of U.S. Company Preferred Stock will receive the same form of consideration for such series, (B) each holder
of a series of U.S. Company Preferred Stock will receive the same amount of consideration per share of such series of U.S. Company Preferred Stock, (C) each holder of U.S. Company Common Stock will receive the same amount of consideration per
share of U.S. Company Common Stock, and (D) the aggregate consideration receivable by all holders of the U.S. Company Preferred Stock and U.S. Company Common Stock shall be allocated among the holders of U.S. Company Preferred Stock and U.S.
Company Common Stock on the basis of the relative liquidation preferences to which the holders of each respective series of U.S. Company Preferred Stock and the holders of U.S. Company Common Stock are entitled in a Change of Control transaction in
accordance with U.S. Company’s certificate of incorporation in effect immediately prior to the proposed Change of Control transaction; and 

  

	 	(vi)	subject to clause (v) above, requiring the same form of consideration to be received by the holders of U.S. Company Preferred Stock, if any holders of U.S. Company Preferred Stock are given an option as to the form
and amount of consideration to be received as a result of the proposed Change of Control transaction, all holders of such capital stock will be given the same option. 

 

	 	(c)	In addition, no Holder shall be a party to a Change of Control transaction structured as a sale of stock by the Holders (“Stock Sale”) unless all holders of Preferred Stock are allowed to participate in
such transaction and the consideration received pursuant to such transaction is allocated among the parties thereto in the manner specified in U.S. Company’s certificate of incorporation in effect immediately prior to the Stock Sale (as if such
transaction were a liquidation event under Section C.2 of Article Fourth). 

  

	 	(d)	Each of the Holders hereby grants U.S. Company a proxy covering the total number of Shares of capital stock of U.S. Company directly or indirectly acquired (of record or beneficially) by such party for the purposes of
approving a Change of Control transaction which complies with this Section 3.6. Each party delivering this proxy hereby agrees that the proxy is coupled with an interest and is irrevocable. 

3.7 Legends 
  

	 	(a)	Share certificates of the Corporation shall bear the following language either as an endorsement or on the face of such share certificate: 

  
 - 21 - 

 The shares represented by this certificate are subject to all the terms and conditions of an
exchange agreement dated for reference June 8, 2007, as amended from time to time, among, inter alia, Aquinox Pharmaceuticals Inc., Aquinox Pharmaceuticals (USA) Inc. and the holders of the shares, which agreement constitutes a unanimous
shareholders agreement within the meaning of the Canada Business Corporations Act and contains, among other things, restrictions on the right of the holder hereof to transfer or sell the shares. A copy of such exchange agreement is on file at the
registered office of the Corporation. 
  

	 	(b)	Share certificates of U.S. Company shall bear the following language either as an endorsement or on the face of such share certificate: 

The shares represented by this certificate are subject to all the terms and conditions of an exchange agreement dated for reference
June 8, 2007, as amended from time to time among, inter alia, Aquinox Pharmaceuticals Inc., Aquinox Pharmaceuticals (USA) Inc. and the holder of the shares, which agreement contains, among other things, restrictions on the right of the
holder hereof to transfer or sell the shares. A copy of such exchange agreement is on file at the registered office of the Corporation. 

ARTICLE 4 
 SUPPORT
AGREEMENT 
 4.1 Application of Support Agreement to holders of Exchangeable Shares 

To the extent that any representation, warranty or covenant contained in Article 2 of the Support Agreement is not provided herein, the Corporation and U.S.
Company hereby incorporate by reference such representations, warranties and covenants and acknowledge that the holders of Exchangeable Shares are relying on such representations, warranties and covenants as if they were parties to the Support
Agreement. 
 4.2 Amendments and Waiver under Support and Exchange Agreements 

The Corporation shall not propose, agree to or otherwise give effect to any amendment to, or waiver or forgiveness of its rights or obligations under, the
Support Agreement or this Agreement without the approval of the holders of the Exchangeable Shares given in accordance with Section 10.2 of the Exchangeable Share Provisions other than such amendments, waivers and/or forgiveness as may be
necessary or advisable for the purposes of: 
  

	 	(a)	adding to the covenants of parties to such agreement other than the Corporation for the protection of the Corporation or the holders of the Exchangeable Shares thereunder; 

 

	 	(b)	making such provisions or modifications not inconsistent with such agreement as may be necessary or desirable with respect to matters or questions arising thereunder which, in the good faith opinion of each of the
Boards, may be expedient to make, provided that each of the Boards shall be of the good faith opinion, after consultation with counsel, that such provisions and modifications will not be prejudicial to the interests of the holders of the
Exchangeable Shares; or 

  
 - 22 - 

	 	(c)	making such changes in or corrections to such agreement which, on the advice of counsel to the Corporation, are required for the purpose of curing or correcting any ambiguity or defect or inconsistent provision or
clerical omission or mistake or manifest error contained therein, provided that the each of the Boards shall be of the good faith opinion, after consultation with counsel, that such changes or corrections will not be prejudicial to the interests of
the holders of the Exchangeable Shares. 

 ARTICLE 5 

APPROVAL MATTERS 
 5.1 Specific Matters
Requiring Board Approval 
 Each of the Companies shall only undertake or proceed with any of the following matters with the prior approval of the Board
of the respective Company: 
  

	 	(a)	approve any adoption or amendment of any plan under which employees of a Company are entitled to purchase or receive shares in the capital of such Company; 

 

	 	(b)	loan any money to, provide a guarantee of, assume liability for the debts or obligations of any other Person other than a Subsidiary of such Company in excess of $50,000, or grant any security interest over the assets
of a Company; 

  

	 	(c)	enter into or amend any employment or consulting agreements with senior management of a Company; 

  

	 	(d)	amend any devotion of time, non-competition, non-disclosure agreements, proprietary rights agreements, employment agreements, profit sharing agreements, or agreements relating to intellectual property with key employees
between a Company and any of its directors, employees, key employees or consultants, other than any amendments that are not prejudicial to a Company; or 

  

	 	(e)	enter into any joint venture or partnership with any corporation, partnership, joint venture, firm or Person. 

Each Company shall ensure that any of its Subsidiaries only undertake or proceed with the kind of transactions referred to above in this Section 5.1 (as
adjusted to relate to similar actions of such Subsidiary) with the prior approval of the Board of the respective Company. 
 5.2 Specific Major Matters
also Requiring Investors’ Approval 
  

	 	(a)	So long as at least 25% of the Preferred Voting Stock issued under the Subscription Agreements (or Preferred Voting Stock issued pursuant to the exchange of Exchangeable Preferred Shares issued pursuant to the
Subscription Agreements) remains outstanding, the Companies shall only undertake or proceed with any of the matters described in subsections (a) through (e) of Section 5.1 or any of the following matters with prior Investor Approval:

  
 - 23 - 

	 	(i)	redeem, purchase or otherwise acquire for value (or pay into or set aside for a sinking fund for such purpose) any securities of a Company (other than securities of the Corporation held or purchased by U.S. Company)
unless required under the special rights and restrictions attached to such securities, this Agreement or the Support Agreement or pursuant the terms of the Incentive Compensation Plans/ESOPs and related agreements thereto; 

 

	 	(ii)	take any action that results in the payment or declaration of any dividend on any securities of a Company (other than securities of the Corporation held by U.S. Company) or in the distribution of any cash (other than in
the normal course of business), securities or assets of the Company unless required under the special rights and restrictions attached to such securities, this Agreement or the Support Agreement; 

 

	 	(iii)	authorize or issue, or obligate itself to issue, any equity security (including any security convertible into or exercisable for any equity security) senior to or on parity with the Preferred Voting Stock or the
Exchangeable Preferred Shares except for any issuance pursuant to this Agreement, the Support Agreement or the Class C Subscription Agreement and except for any issuance by the Corporation to U.S. Company; 

 

	 	(iv)	effect a public offering of securities of a Company; 

  

	 	(v)	amend, alter or repeal any of the provisions of a Company’s Constating Documents; 

  

	 	(vi)	take any action which effects a liquidation, dissolution or winding up of a Company or any Subsidiary of a Company; 

  

	 	(vii)	make any loans or monetary advances to employees of a Company or of any Subsidiary of a Company (or any relative of such persons), except as unanimously approved by the Board of such Company; 

 

	 	(viii)	incur or guarantee any indebtedness, or permit any Subsidiary to incur or guarantee any such indebtedness, except as unanimously approved by the Board of such Company; 

 

	 	(ix)	create any mortgage, pledge, or other security interest in all or substantially all of the property of a Company, or any of its Subsidiaries, except as unanimously approved by the Board of such Company;

  

	 	(x)	own, or permit any Subsidiary of a Company to own, any stock or other securities of any other corporation, partnership or entity (other than stock or other securities of the Corporation held by U.S. Company), unless
such entity is wholly-owned by such Company and such ownership is unanimously approved by the Board of such Company; 

  
 - 24 - 

	 	(xi)	increase or decrease the number of directors of a Company except in accordance with the Shareholders’ Agreement; 

  

	 	(xii)	effect a Change of Control or enter into any agreement relating to the same unless such Change of Control is in accordance with Section 3.6 of this Agreement or has been approved by Majority Approval; 

 

	 	(xiii)	make a material change in the nature of the Business; or 

  

	 	(xiv)	 increase, or authorize the increase of, the number of securities of a Company available under the Incentive Compensation Plans/ESOPs. 

 

	 	(b)	The Corporation shall not issue any of its New Common Shares or Non-Voting Preferred Shares to any Person other than U.S. Company, and U.S. Company shall not Transfer any New Common Shares or Non-Voting Preferred Shares
of the Corporation to any Person other than the Corporation, without prior Investor Approval. 

 ARTICLE 6 

GENERAL 
 6.1 Call Rights, Compliance
with other Instruments 
 Each holder hereby acknowledges and agrees to the Liquidation Call Right, Redemption Call Right and the Retraction Call Right,
and hereby grants each such right to U.S. Company and (if designated by U.S. Company) to Permitted Subsidiary. Each of the Corporation and U.S. Company confirms that it will comply, and U.S. Company will cause Permitted Subsidiary to comply, with
the Exchangeable Share Provisions and the Support Agreement, as applicable. 
 6.2 Unanimous Shareholders Agreement 

The parties hereto agree that this Agreement is intended to operate as a unanimous shareholders agreement within the meaning of the Canada Business
Corporations Act with respect to the Corporation. 
 6.3 Term 

This Agreement shall come into force and be effective as of the date hereof and shall terminate and be of no further force and effect at such time as no
Exchangeable Shares (or securities or rights convertible into or exchangeable for or carrying rights to acquire Exchangeable Shares) are held by any party other than U.S. Company and its Affiliates. 

6.4 Severability 
 If, in any jurisdiction, any provision
of this Agreement or its application to any party or circumstance is restricted, prohibited or unenforceable, such provision shall, as to such jurisdiction, be ineffective only to the extent of such restriction, prohibition or unenforceability
without invalidating the remaining provisions of this Agreement and without affecting the validity or enforceability of such provision in any other jurisdiction or without affecting its application to other parties or circumstances. 

  
 - 25 - 

 6.5 Enurement 

This Agreement shall be binding upon and enure to the benefit of the parties hereto and their respective successors and permitted assigns. 

6.6 Notices to Parties 
 All notices, requests, consents
and demands must be in writing and must be personally delivered (effective upon receipt), faxed (effective upon receipt of the fax in complete, readable form), or sent via a reputable overnight courier service (effective the following Business Day):

  

	 	(a)	if to U.S. Company or the Corporation, to: 

 Suite 430, 5600 Parkwood Way 

Richmond, BC V6V 2M2 
 Facsimile:
(778) 331-4486 
 Attention: David Main 

with a copy to: 
 McCarthy
Tétrault LLP 
 777 Dunsmuir Street Suite 1300 

PO Box 10424 Pacific Centre 

Vancouver BC V7Y 1K2 
 Facsimile:
(604) 622-5796 
 Attention: Robin Mahood 

and to: 
 Cooley LLP 

719 Second Avenue 
 Suite 900 

Seattle, WA 98104 
 Facsimile:
(206) 452-8800 
 Attention: Gordon Empey 

6.7 Notice to Holders 
 Any and all notices to be given
and any documents to be sent to any holders of Exchangeable Shares may be given or sent to the address of such Holder shown on the register of holders of Exchangeable Shares in any manner permitted by the by-laws of the Corporation from time to time
in force in 

  
 - 26 - 

 
respect of notices to shareholders and shall be deemed to be received (if given or sent in such manner) at the time specified in such by-laws, the provisions of which by-laws shall apply
mutatis mutandis to notices or documents as aforesaid sent to such Holders. Any and all notices to be given and any documents to be sent to any holders of U.S. Company Shares may be given or sent to the address of such Holder shown on the
register of holders of U.S. Company Shares in any manner permitted by the by-laws of U.S. Company from time to time in force in respect of notices to shareholders and shall be deemed to be received (if given or sent in such manner) at the time
specified in such by-laws, the provisions of which by-laws shall apply mutatis mutandis to notices or documents as aforesaid sent to such Holders. 

6.8 Counterparts 
 This Agreement may be executed in
counterparts and by facsimile signature, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. 

6.9 Governing Law 
 This Agreement shall be construed and
enforced in accordance with the laws of Province of British Columbia and the laws of Canada applicable therein. Any action, suit or proceeding arising out of or relating to this Agreement shall be brought in the Courts of the Province of British
Columbia , and each of the parties hereby irrevocably submits to the jurisdiction of such courts. 

  
 - 27 - 

 IN WITNESS WHEREOF the parties hereto have caused this Agreement to be duly executed as of
the date first above written. 
  

							
	AQUINOX PHARMACEUTICALS INC.	  	AQUINOX PHARMACEUTICALS (USA) INC.
				
	Per:	  	 /s/ David Main
	  		  	
		  	(Authorized Signatory)	  	Per:	  	 /s/ David Main

		  		  		  	(Authorized Signatory)
		
	BAKER BROS. LIFE SCIENCES, L.P.	  	BAKER BROS. INVESTMENTS II, L.P.
	By:	  	Baker Bros. Advisors, LLC,	  	By:	  	Baker Bros. Advisors, LLC,
		  	management company and	  		  	management company and investment
		  	investment adviser to Baker Brothers	  		  	adviser to Baker Bros. Investments II,
		  	Life Sciences, L.P., pursuant to	  		  	L.P., pursuant to authority granted to it
		  	authority granted to it by Baker	  		  	by Baker Bros. Capital, L.P., general
		  	Brothers Life Sciences Capital L.P.,	  		  	partner to Baker Bros. Investments II,
		  	general partner to Baker Brothers	  		  	L.P., and not as the general partner
		  	Life Sciences, L.P., and not as the	  		  	
		  	general partner	  	By:	  	 /s/ Scott Lessing

		  		  		  	Scott Lessing
	By:	  	 /s/ Scott Lessing
	  		  	President
		  	Scott Lessing	  		  	
		  	President	  		  	
		
	667, L.P.	  	14159, L.P.
	By:	  	Baker Bros. Advisors, LLC,	  	By:	  	Baker Bros. Advisors, LLC,
		  	management company and	  		  	management company and investment
		  	investment adviser to 667, L.P.,	  		  	adviser to 14159, L.P., pursuant to
		  	pursuant to authority granted to it by	  		  	authority granted to it by 14159
		  	Baker Biotech Capital, L.P., general	  		  	Capital, L.P., general partner to 14159,
		  	partner to 667, L.P., and not as the	  		  	L.P., and not as the general partner
		  	general partner	  		  	
		  		  	By:	  	 /s/ Scott Lessing

	By:	  	 /s/ Scott Lessing
	  		  	Scott Lessing
		  	Scott Lessing	  		  	President
		  	President	  		  	

  
 - 28 - 

							
	VENTURES WEST 8 LIMITED	    	B.C. ADVANTAGE FUND (VCC) LTD.
	PARTNERSHIP, by its General Partner,	    		 	
	Ventures West 8 Management Ltd.	    		 	
		 		    	Per:	 	 /s/ Illegible

	Per:	 	 /s/ Illegible
	    		 	(Authorized Signatory)
		 	(Authorized Signatory)	    		 	
				
	Per:	 	 /s/ Illegible
	    		 	
		 	(Authorized Signatory)	    		 	
		
	JOHNSON & JOHNSON DEVELOPMENT CORPORATION	    	PFIZER INC.
				
		 		    	Per:	 	 /s/ Barbara Dalton

	Per:	 	 /s/ Asish K. Xavier
	    		 	(Authorized Signatory)
		 	Asish K. Xavier, Ph.D.	    		 	
		 	Principal/Executive Director, Venture	    		 	
		 	Investments	    		 	
			
	AUGMENT INVESTMENTS LTD.	    		 	
				
	Per:	 	 /s/ Egor Rulkov
	    		 	
		 	Egor Rulkov	    		 	
		 	Attorney in Fact by Power of Attorney	    		 	

  
 - 29 - 

					
	 SIGNED AND DELIVERED by Raymond J. Andersen in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 RAYMOND J.
ANDERSEN

  

					
	 SIGNED AND DELIVERED by Gerald Krystal in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 GERALD
KRYSTAL

  

					
	 SIGNED AND DELIVERED by Gerald Krystal and Jacqueline Lea Krystal as trustees of The Krystal Family Trust in the presence of:

 
  

Signature
  

 
 Print Name

 
  

Address
  

 
 Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 GERALD KRYSTAL AND JACQUELINE
LEA KRYSTAL AS TRUSTEES OF THE KRYSTAL FAMILY TRUST

  
 - 30 - 

					
	 SIGNED AND DELIVERED by David J. Main and Karen M. Main as trustees of the Main Family Trust in the presence of:

 
  

Signature
  

 
 Print Name

 
  

Address
  

 
 Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 DAVID J. MAIN AND KAREN M.
MAIN AS TRUSTEES OF THE MAIN FAMILY TRUST

  

					
	 SIGNED AND DELIVERED by Alice Low Fung Mui in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 ALICE LOW FUNG
MUI

  

					
	 SIGNED AND DELIVERED by Christopher John Ong in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 CHRISTOPHER JOHN
ONG

  
 - 31 - 

					
	 SIGNED AND DELIVERED by David Main in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 DAVID MAIN

  

					
	 SIGNED AND DELIVERED by Christopher John Ong as trustee of the CJ Ong Family Trust in the presence of:

 
  

Signature
  

 
 Print Name

 
  

Address
  

 
 Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 CHRISTOPHER JOHN ONG AS
TRUSTEE OF THE CJ ONG FAMILY TRUST

  

							
	RIX VENTURE CAPITAL (VCC) CORP.	  	        BUILDING BIOTECH (VCC) LTD.
				
	Per:	  	  
	  	        Per:	  	  

		  	(Authorized Signatory)	  		  	(Authorized Signatory)

  
 - 32 - 

					
	 SIGNED AND DELIVERED by David M. Babych in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 DAVID M.
BABYCH

  

					
	 SIGNED AND DELIVERED by Grant A. Dakus in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 GRANT A.
DAKUS

  

					
	 SIGNED AND DELIVERED by Ian Mortimer in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 IAN MORTIMER

  
 - 33 - 

							
	RIX PROFESSIONAL MEDICAL CORPORATION	  	MARK BETTERIDGE & ASSOCIATES (MBA) INC.
				
	Per:	  	  
	  	Per:	  	  

		  	(Authorized Signatory)	  		  	(Authorized Signatory)

  

					
	 SIGNED AND DELIVERED by Joseph Garcia in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 JOSEPH
GARCIA

  

					
	 SIGNED AND DELIVERED by Barry Pynn in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 BARRY PYNN

  
 - 34 - 

					
	 SIGNED AND DELIVERED by James Hoggan in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 JAMES HOGGAN

  

							
	UNIVERSITY OF PAPUA NEW GUINEA	  	THE UNIVERSITY OF BRITISH COLUMBIA
				
	Per:	  	  
	  	Per:	  	  

		  	(Authorized Signatory)	  		  	(Authorized Signatory)

  

					
	 SIGNED AND DELIVERED by Bruce Hay in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 BRUCE HAY

  
 - 35 - 

					
	 SIGNED AND DELIVERED by Rich Simons in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 RICH SIMONS

  

					
	 SIGNED AND DELIVERED by Timothy Fernback in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 TIMOTHY
FERNBACK

  

			
	THE BRITISH COLUMIA CANCER AGENCY BRANCH
		
	Per:	 	  

		 	(Authorized Signatory)

  
 - 36 - 

  

					
	 SIGNED AND DELIVERED by David Williams in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 DAVID
WILLIAMS

  

					
	 SIGNED AND DELIVERED by Michael LeBlanc in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 MICHAEL
LEBLANC

  

					
	 SIGNED AND DELIVERED by Gina Chong in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 GINA CHONG

  
 - 37 - 

					
	 SIGNED AND DELIVERED by Nicole Lee-Son in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
  

Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 NICOLE
LEE-SON

  

					
	 SIGNED AND DELIVERED by Matt Nodwell in the presence of:
  

 
 Signature

 
  

Print Name
  

 
 Address

 
 Occupation
	  	)
)
)
)
)
)
)
)
)
)
)
)
)	  	  
 MATT NODWELL

  
 - 38 - 

 SCHEDULE “A” 

to the Aquinox Pharmaceuticals Inc./Aquinox Pharmaceuticals (USA) Inc. 

Exchange Agreement 

COUNTERPART SIGNATURE PAGE 
 THE
UNDERSIGNED, ¿, has purchased ¿ shares of [¿ Exchangeable Shares of Aquinox Pharmaceuticals
Inc. or ¿shares of U.S. Company Preferred Stock of Aquinox Pharmaceuticals (USA) Inc.] and hereby undertakes and agrees to become a party to and to be bound by the terms and conditions of the
Amended & Restated Exchange Agreement between Aquinox Pharmaceuticals Inc., Aquinox Pharmaceuticals (USA) Inc. made as of March 19, 2013, a copy of which agreement the undersigned acknowledges having received. 

IN WITNESS WHEREOF this                     day of
                    ,
                        . 
  

			
	 	 	  

	 	 	Shareholder
	By:	 	  

	Name:	 	
	Title:	 	
	Address:	 	  

		 	  

		 	  

		 	

 
					
	 Name and class
 of shares
held:
	 	_____________________Joint Canadian Stock Option Plan

 Exhibit 10.1 

AQUINOX PHARMACEUTICALS INC. 

AQUINOX PHARMACEUTICALS (USA) INC. 

JOINT CANADIAN STOCK OPTION PLAN AS 

AMENDED AND RESTATED AS OF JUNE 8, 2007 
  

	1.	PURPOSE OF THE PLAN 

 Aquinox Pharmaceuticals Inc. (“Aquinox Canada”) and Aquinox
Pharmaceuticals (USA) Inc. (“Aquinox US”) hereby confirm the terms and conditions of the amended and restated joint stock option plan for directors, officers, employees and Service Providers (as defined below) of Aquinox Canada and
Aquinox US and their respective affiliates, to be known as the “Aquinox Joint Canadian Stock Option Plan” (the “Plan”). 
 This
Plan amends and restates the stock option plan of Aquinox Canada originally approved the Board of Directors of Aquinox Canada on June 21, 2006 (which plan, as amended and restated from time to time, is referred to as the “Original
Plan”). 
  

	2.	DEFINITIONS 

 In this Plan, the following terms shall have the following meanings: 

 

	2.1	“Affiliate” means an affiliate as interpreted in accordance with the Securities Act. 

  

	2.2	“Associate” means an associate as defined in the Securities Act. 

  

	2.3	“Board” means the Boards of Directors of both Aquinox Canada and Aquinox US up to the Exchange Time and the Board of Directors of Aquinox US after the Exchange Time. 

 

	2.4	“Cause” means: 

  

	 	(a)	Cause as such term is defined in the written employment or services agreement between Aquinox Canada or Aquinox US and the Optionee or, in the case of an Option granted to an Optionee who falls under the definition of
Service Provider set out in Subsection 2.30(b), the Optionee’s employer; or 

  

	 	(b)	in the event there is no such written agreement or Cause is not defined therein, the usual meaning of just cause under the common law or the laws of the jurisdiction in which the Optionee or the Optionee’s
employer, as applicable, is employed or engaged. 

  

	2.5	“Change of Control” means: 

  

	 	(a)	 any acquisition of Aquinox US by means of merger or other form of corporate reorganization in which stockholders of Aquinox US immediately prior to
such event do not hold a majority of outstanding voting securities (as defined in the Securities Act) or interest of the surviving corporation or entity and in which 

	 	
outstanding Shares of Aquinox US are exchanged for securities or other consideration issued (or caused to be issued) by the acquiring corporation or its subsidiary (other than a mere
reincorporation transaction) or entity, or any transaction or series of related transactions to which Aquinox US is a party in which in excess of fifty percent (50%) of the outstanding voting securities of Aquinox US is transferred;

  

	 	(b)	any sale or other disposition (or series of related sales or dispositions) of the outstanding voting securities of Aquinox US whereby stockholders of Aquinox US immediately prior to such event do not hold a majority of
the outstanding voting securities of Aquinox US immediately after such event; 

  

	 	(c)	any sale, license, lease or disposition of all or substantially all of the assets of Aquinox US; or 

  

	 	(d)	any similar transaction as described in clauses (a) through (c) above with respect to Aquinox Canada. 

  

	2.6	“Common Shares” means shares in the common stock of Aquinox US. 

  

	2.7	“Company” means either Aquinox Canada or Aquinox US, as the case may be, and “Companies” means both Aquinox Canada and Aquinox US together. 

 

	2.8	“Corporate Reorganization” has the meaning assigned in Section 5.3. 

  

	2.9	“Disability” means any disability with respect to an Optionee which the Board of Directors of the Company for which the Optionee serves as a director, officer, employee or Service Provider, in its sole
and unfettered discretion, considers likely to prevent permanently the Optionee from: 

  

	 	(a)	being employed or engaged by that Company, one of its Affiliates or another employer, in a position the same as or similar to that in which he was last employed or engaged by that Company or one of its Affiliates; or

  

	 	(b)	acting as a director or officer of that Company or one of its Affiliates. 

  

	2.10	“Equity Securities” means: 

  

	 	(a)	Common Shares or any other security of Aquinox US that carries the residual right to participate in the earnings of Aquinox US and, on liquidation, dissolution or winding-up, in the assets of Aquinox US, whether or not
the security carries voting rights; 

  

	 	(b)	any warrants, options or rights entitling the holders thereof to purchase or acquire any securities referred to in Subsection 2.10(a); or 

 

	 	(c)	any securities issued by Aquinox Canada which are convertible or exchangeable, directly or indirectly, into securities referred to in Subsection 2.10(a) (including securities exchangeable pursuant to Exchange Rights).

	2.11	“Exchangeable Shares” means common exchangeable shares of Aquinox Canada. 

  

	2.12	“Exchange Agreement” means the exchange agreement dated on or about June 8, 2007 between the Companies and holders of Shares of the Companies, as amended from time to time. 

 

	2.13	“Exchange Agreement Counterpart” means a counterpart signature page to the Exchange Agreement, substantially in the form attached to the Exchange Agreement. 

 

	2.14	“Exchange Rights” means the rights of a holder of Exchangeable Shares to receive, and the rights of Aquinox US to acquire Exchangeable Shares upon payment of, consideration upon exercise of such rights
consisting, in whole or in part, of Common Shares of Aquinox US. 

  

	2.15	“Exchange Time” means the time at which there are no Exchangeable Shares outstanding other than Exchangeable Shares, if any, held by Aquinox US and its Affiliates. 

 

	2.16	“Expiry Date” means the date set by the Board under Section 3.1 of the Plan, as the last date on which an Option may be exercised. 

 

	2.17	“Fair Market Value” means, with respect to any property (including, without limitation, any Shares or other securities), the fair market value of such property determined by such methods or procedures
as shall be established from time to time by the Board. 

  

	2.18	“Fully Converted Basis” at any time means that all Shares then outstanding which are convertible or exchangeable (directly or indirectly) (including pursuant to the Exchange Rights) into Common Shares
shall be deemed to have been fully converted and exchanged into Common Shares, in accordance with the rights, privileges, restrictions and conditions attached thereto, and Common Shares issuable as a result thereof shall be deemed to have been fully
issued and to form part of the holdings of the person(s) entitled to receive such Common Shares. 

  

	2.19	“Grant Date” means the date specified in an Option Agreement as the date on which an Option is granted. 

  

	2.20	“Option” means an option to purchase Option Securities granted pursuant to the Original Plan or this Plan as from time to time amended, restated, adjusted or confirmed. 

 

	2.21	“Option Agreement” means an agreement, in the form approved pursuant to the Original Plan or as amended, restated, adjusted or confirmed, or in the form attached hereto as Schedule A, whereby the
Companies grant an Option to an Optionee. 

	2.22	“Optionee” means each of the directors, officers, employees and Service Providers of Aquinox Canada, Aquinox US and their respective Affiliates granted an Option pursuant to the Original Plan or this
Plan and their Personal Representatives and an Optionee may also be a corporation wholly-owned by an individual eligible for an Option grant pursuant to this Plan. 

 

	2.23	“Option Price” means the price per Option Security specified in an Option Agreement, adjusted from time to time in accordance with the provisions of Section 5. 

 

	2.24	“Option Securities” means: 

  

	 	(a)	up to the Exchange Time, the aggregate number of Units which an Optionee may purchase under an Option; and 

  

	 	(b)	after the Exchange Time, the aggregate number of Common Shares which an Optionee may purchase under an Option. 

  

	2.25	“Original Plan” has the meaning assigned in Section 1. 

  

	2.26	“Personal Representative” means: 

  

	 	(a)	in the case of a deceased Optionee, the executor or administrator of the deceased duly appointed by a court or public authority having jurisdiction to do so; and 

 

	 	(b)	in the case of an Optionee who for any reason is unable to manage his or her affairs, the person entitled by law to act on behalf of such Optionee. 

 

	2.27	“Plan” has the meaning assigned in Section 1. 

  

	2.28	“Regulatory Authorities” means all stock exchanges, inter-dealer quotation networks and other organized trading facilities on which the Shares are listed and all securities commissions or similar
securities regulatory bodies having jurisdiction over the Companies. 

  

	2.29	“Securities Act” means the Securities Act, R.S.B.C. 1996, c.418, as amended, as at the date hereof. 

  

	2.30	“Service Provider” means: 

  

	 	(a)	any person or company engaged to provide ongoing management, consulting or advisory services for one of the Companies or an Affiliate of one of the Companies, provided such person is not an employee of either Company;
and 

  

	 	(b)	any person who is providing ongoing management, consulting or advisory services to one of the Companies or an Affiliate of one of the Companies indirectly through a company that is a Service Provider under
Subsection 2.30(a), provided such person is not an employee of either Company. 

	2.31	“Shares” means shares of any class in the share capital of either Company from time to time. 

  

	2.32	“Termination Date” means: 

  

	 	(a)	in the case of the resignation of the Optionee’s employment or the termination of the Optionee’s employment or, in the case of an Option granted to an Optionee who falls under the definition of Service
Provider set out in Subsection 2.30(b), the Service Provider’s (as defined in Subsection 2.30(a)) services contract by the Optionee or Service Provider, as the case may be, the date that the Optionee or Service Provider, as applicable,
provides notice of such resignation or termination to the applicable Company; 

  

	 	(b)	in the case of the termination of the Optionee’s employment or services contract by the applicable Company for any reason other than death or Disability, the date that such Company delivers written notice of
termination of such employment or services contract to the Optionee or the Service Provider, as applicable; 

  

	 	(c)	in the case of the expiry of a fixed-term employment or consulting or service contract that is not renewed or extended, the last day of the term; or 

 

	 	(d)	in the case of a director or officer ceasing to meet the qualifications required for such position under applicable laws for the purposes of Subsection 4.5(b), the date such director or officer ceases to meet such
qualifications. 

  

	2.33	“Unissued Option Securities” means the number of Option Securities, at a particular time, which have been allotted for issuance upon the exercise of an Option but which have not been issued, as adjusted
from time to time in accordance with the provisions of Section 5, such adjustments to be cumulative. 

  

	2.34	“Unit” means a unit consisting of the following securities of Aquinox Canada: 

  

	 	(a)	one Exchangeable Share; and 

  

	 	(b)	one special voting share of Aquinox Canada. 

  

	2.35	“Vested” means that an Option has become exercisable in respect of a number of Option Securities by the Optionee pursuant to the terms of the Option Agreement. 

 

	2.36	“$” means United States dollars unless otherwise specified. 

  

	3.	GRANT OF OPTIONS 

  

	3.1	Option Terms 

 The Board may from time to time authorize the issue of Options to directors, officers,
employees and Service Providers of the Companies and their Affiliates. The Option Price under each Option shall be determined by the Board at the time of issue of the Option, shall be subject to adjustment in accordance with Section 5. 

 The Expiry Date for each Option shall be set by the Board at the time of issue of the Option and shall not be
more than ten years after the Grant Date. Options shall not be assignable (or transferable) by the Optionee provided, however, that the Personal Representative of an Optionee may, to the extent permitted by Section 4.2, exercise an Option prior
to the Expiry Date for such Option (subject to Section 4.4 and 4.5). No Option or right under any Option may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall
be void and unenforceable against any Company or any of its Affiliates. 
  

	3.2	Limits on Common Shares Issuable on Exercise of Options 

 The maximum number of Common Shares which may
be directly or indirectly issuable pursuant to Options granted under the Plan and options granted under any other stock option plan adopted by either or both of the Companies shall be 2,750,000 Common Shares (subject to adjustment to account for
stock dividends, combinations, stock splits and other similar recapitalizations affecting Option Securities or Shares issuable upon exchange of Option Securities), or such other amount as may be approved from time to time by the Board. 

 

	3.3	Option Agreements 

 Each Option shall be confirmed by the execution of an Option Agreement. Each Optionee
shall have the option to purchase from the Companies the Option Securities at the time and in the manner set out in the Plan and in the Option Agreement applicable to that Optionee. The execution of an Option Agreement shall constitute conclusive
evidence that the Option granted thereunder has been granted in compliance with the Original Plan or this Plan. 
  

	3.4	Allocation of Option Price 

 If any Units are issued on the exercise of an Option, the Option Price paid
for each Unit shall be allocated to each share forming part of the Unit by the Board, in its sole discretion, based on the Fair Market Value of such share. 
  

	4.	EXERCISE OF OPTION 

  

	4.1	When Options May be Exercised 

 Subject to Sections 4.4 and 4.5, an Option may be exercised to
purchase any number of Option Securities up to the number of Vested Unissued Option Securities at any time after the Grant Date up to 4:30 p.m. local time in Vancouver, British Columbia on the Expiry Date and shall not be exercisable thereafter.

  

	4.2	Manner of Exercise 

 An Option may be exercised only by the Optionee or the Personal Representative of
the Optionee. Prior to the Exchange Time an Option shall be exercisable by delivering to Aquinox 

 
Canada, on behalf of the Companies, a notice specifying the number of Unissued Option Securities in respect of which the Option is exercised together with payment in full of the Option Price for
such Option Securities and, if the Optionee is not already a party to the Exchange Agreement, an executed Exchange Agreement Counterpart. From and after the Exchange Time an Option shall be exercisable by delivering to Aquinox US a notice specifying
the number of Unissued Option Securities in respect of which the Option is exercised together with payment in full of the Option Price for such Option Securities. 

Upon notice and payment there will be a binding contract for the issue of the Option Securities in respect of which the Option is exercised, upon and subject
to the provisions of the Plan. As soon as practicable thereafter, the applicable Company will, in its sole discretion, deliver to the Optionee a certificate or certificates, as the case may be, for the Shares purchased by the Optionee or deliver to
the Optionee copies of such certificate or certificates and the original of such certificate or certificates will be placed in the minute books of such Company. Delivery of a cheque payable to Aquinox Canada or Aquinox US, as applicable, in the
amount of the Option Price shall constitute payment of the Option Price unless the cheque is not honoured upon presentation in which case the Option shall not have been validly exercised. 

 

	4.3	Condition of Issue 

 The Options and the issue of Shares by Aquinox Canada or Aquinox US, as applicable,
pursuant to the exercise of Options are subject to the terms and conditions of the Plan and compliance with the rules and policies of all applicable Regulatory Authorities with respect to the granting of such Options and the issuance and
distribution of such Shares, and to all applicable securities laws and regulations. Each Optionee agrees to comply with all such laws, regulations, rules and policies and agrees to furnish to the Companies any information, reports or undertakings
required to comply with, and to fully cooperate with, the Companies in complying with such laws, regulations, rules and policies. 
  

	4.4	Vesting of Option Securities 

 Each Option shall become Vested as determined by the Board on the Grant
Date, or, if no such determination is made, shall be subject to the following vesting schedule: 
  

	 	(a)	25% of the Option Securities will vest on the date that is twelve months after the Grant Date; and 

  

	 	(b)	the balance of the Option Securities will vest in equal amounts on the last day of each of the first 36 months ending after the expiry of such twelve month period, with
1/48th of the Option Securities vesting on each such day. 

	4.5	Termination 

 If an Optionee ceases to be a director, officer, employee or Service Provider of a Company
or an Affiliate of a Company, his or her Option shall be exercisable as follows: 
  

	 	(a)	Death or Disability 

 If the Optionee ceases to be a director, officer, employee or
Service Provider of a Company or an Affiliate of a Company, due to his or her death or Disability or, in the case of an Optionee that is a company, the death or Disability of the person who provides management or consulting services to a Company or
an Affiliate of a Company, any outstanding Option then held by the Optionee shall be cancelled as of the day that is one (1) year after the Optionee ceases to be a director, officer, employee or Service Provider. 

 

	 	(b)	Termination For Cause 

 If the Optionee, or in the case of an Option granted to an
Optionee who falls under the definition of Service Provider set out in Subsection 2.30(b), the Optionee’s employer, ceases to be a director, officer, employee or Service Provider of a Company or an Affiliate of a Company as a result of
termination (including, in the case of a Service Provider, termination by the relevant Company of the relevant consulting contract and, in the case of a Service Provider as defined in Subsection 2.30(b), termination of the Optionee by the
Optionee’s employer), for Cause or, in the case of a director or officer only, ceasing to meet the qualifications required for such position under applicable laws, any outstanding Option held by such Optionee on the Termination Date, whether in
respect of Option Securities that are Vested or not, shall be cancelled as of that date. 
  

	 	(c)	Early Retirement, Voluntary Resignation or Termination Other than For Cause 

 If the
Optionee or, in the case of an Option granted to an Optionee who falls under the definition of Service Provider set out in Subsection 2.30(b), the Optionee’s employer, ceases to be a director, officer, employee or Service Provider of a
Company or an Affiliate of a Company due to his or her retirement at the request of his or her employer earlier than the normal retirement date under the employer’s retirement policy then in force, or due to his or her termination by his or her
employer (including, in the case of a Service Provider, termination by the relevant Company of the relevant consulting contract and, in the case of a Service Provider as defined in Subsection 2.30(b), termination of the Optionee by the
Optionee’s employer) other than for Cause (whether such termination occurs with or without any or adequate reasonable notice, or with or without any or adequate compensation in lieu of such reasonable notice), or due to his or her voluntary
resignation, any outstanding Option then held by the Optionee shall be exercisable to acquire then Vested Unissued Option Securities at any time up to but not after the earlier of the Expiry Date and the date which is 90 days after the Termination
Date. 
 For greater certainty, an Option that had not become Vested in respect of certain Unissued Option Securities at the time that the
relevant event referred to in this Section 4.5 occurred, shall not be or become exercisable in respect of such Unissued Option Securities and shall be cancelled. 

	4.6	Change of Control 

  

	 	(a)	Notwithstanding anything else in this Plan, the Board has the right to: 

  

	 	(i)	provide for the conversion or exchange of any outstanding Options into or for options, rights or other securities in any entity participating in or resulting from a Change of Control; 

 

	 	(ii)	in case of a proposed Change of Control under the terms of which holders of Shares will receive cash consideration for each Share surrendered in the combination, provide for the delivery to each Optionee of the cash
consideration that the Optionee would have received had the Optionee exercised all of the Optionee’s outstanding Vested Options immediately prior to the effective date of the Change of Control (less the amount the Optionee would have been
required to pay to the applicable Company on that exercise in cash), in exchange for the termination of all of the Optionee’s Options; and 

  

	 	(iii)	take such other actions or combinations of actions referred to in this Section 4.6 as it deems appropriate and reasonable under the circumstances including but not limited to amending and terminating the Plan and
outstanding Options in order to complete the Change of Control provided, however, that as a result of such actions each Optionee receives equivalent consideration that the Optionee would have received had the Optionee exercised all of the
Optionee’s outstanding Vested Options immediately prior to the effective date of the Change of Control (less the amount the Optionee would have been required to pay to the applicable Company on that exercise in cash). 

 

	 	(b)	Upon either Company entering into an agreement relating to, or otherwise becoming aware of, a transaction that, if completed, would result in a Change of Control, Aquinox Canada or Aquinox US shall give written notice
of the proposed transaction to the Optionees, together with a description of the anticipated effect of such Change of Control on outstanding Options, not less than five days prior to the closing of the transaction resulting in the Change of Control.

  

	 	(c)	The Board may, in its sole discretion, accelerate the vesting of any or all outstanding Options to provide that, notwithstanding Section 4.4 or any Option Agreement, such outstanding Options shall be fully Vested
and conditionally exercisable upon (or prior to) the completion of the Change of Control, but the Board shall not, in any case, authorize the exercise of Options pursuant to this section beyond the Expiry Date of the Options. If the Board elects to
accelerate the vesting of the Options, then if any of such Options are not exercised within five days after the Optionees are given the notice contemplated in Subsection 4.6(b), such unexercised Options shall terminate and expire upon the
completion of the proposed Change of Control. 

  

	 	(d)	 If and to the extent that the Board accelerates the vesting of Options under Subsection 4.6(c) in connection with a transaction that, if
completed, would result in a Change of Control and the transaction is not completed for any reason, any Option Securities received upon any exercise of such Options may be returned by

	 	
the Optionee to the applicable Company and reinstated as authorized but unissued share capital and with respect to such returned Option Securities the Option shall be reinstated as if it had not
been exercised and the terms upon which such Option was to become Vested under Section 4.4 shall be reinstated. If any Option Securities are returned to a Company under this Subsection 4.6(d), such Company shall immediately refund the exercise
price to the Optionee for such Option Securities. 

  

	 	(e)	To the extent that the Change of Control would also result in a capital reorganization, arrangement, amalgamation or reclassification of the share capital of either of the Companies and the Board does not accelerate the
vesting of Options pursuant to Subsection 4.6(c), the Companies shall make adequate provision to ensure that, upon completion of the proposed Change of Control, the number and kind of securities subject to outstanding Options and/or the
Exercise Price of outstanding Options shall be appropriately adjusted in such manner as the Board considers equitable, in its sole discretion, to prevent material dilution or enlargement of the rights granted to Optionees. 

 

	4.7	Exclusion From Severance Allowance, Retirement Allowance or Termination Settlement 

 If the Optionee, or,
in the case of an Option granted to an Optionee who falls under the definition of Service Provider set out in Subsection 2.30(b), the Optionee’s employer, retires, resigns or is terminated from employment or engagement with a Company or
any Affiliate of a Company, the loss or limitation, if any, pursuant to the Option Agreement with respect to the right to purchase Option Securities which were not Vested at that time or which, if Vested, were cancelled, shall not give rise to any
right to damages and shall not be included in the calculation of nor form any part of any severance allowance, retiring allowance or termination settlement of any kind whatsoever in respect of such Optionee. 

 

	4.8	Option Securities Not Acquired 

 Any Unissued Option Securities not acquired by an Optionee under an
Option which has expired may be made the subject of a further Option pursuant to the provisions of the Plan or any other stock option plan adopted by either or both of the Companies. 

 

	5.	ADJUSTMENT OF OPTION PRICE AND NUMBER OF OPTION SECURITIES 

  

	5.1	Share Reorganization 

 Whenever either Company issues Shares to all or substantially all holders of
Shares by way of a stock dividend or other distribution, or subdivides all of its outstanding Shares into a greater number of Shares, or combines or consolidates all of its outstanding Shares into a lesser number of Shares (each of such events being
herein called a “Share Reorganization”) then effective immediately after the record date for such dividend or other distribution or the effective date of such subdivision, combination or consolidation, for each Option the Option
Price will be reduced or increased, and the number of Unissued Option Securities will be correspondingly increased or reduced, respectively, by such amount, if any, as is determined by the Board in its sole and unfettered discretion to be
appropriate in order that: 
  

	 	(a)	after the Share Reorganization, the Optionee holding the Option is entitled, on payment of the same aggregate Option Price, to purchase such number of Unissued Option Securities as would represent the same percentage
voting entitlement on a Fully Converted Basis as if the Option were exercised immediately prior to the Share Reorganization taking effect; and 

	 	(b)	after the Share Reorganization, the Optionee holding the Option is entitled to, on payment of the same aggregate Option Price, to purchase such number of Unissued Option Securities as would represent the same percentage
of outstanding Equity Securities on a Fully Converted Basis as if the Option were fully exercised immediately prior to the Share Reorganization taking effect. 

  

	5.2	Special Distribution 

 Whenever either Company issues by way of a dividend or otherwise distributes to
all or substantially all holders of Shares: 
  

	 	(a)	shares of such Company; 

  

	 	(b)	evidences of indebtedness; 

  

	 	(c)	any cash or other assets, excluding cash dividends (other than cash dividends which the Board of that Company has determined to be outside the normal course); or 

 

	 	(d)	rights, options or warrants; 

 then to the extent that such dividend or distribution does not constitute a
Share Reorganization (any of such non-excluded events being herein called a “Special Distribution”), and effective immediately after the record date at which holders of Shares are determined for purposes of the Special Distribution,
for each Option the Option Price will be reduced, and the number of Unissued Option Securities will be correspondingly increased, by such amount, if any, as is determined by the Board in its sole and unfettered discretion to be appropriate in order
to properly reflect any diminution in value of the Option Securities as a result of such Special Distribution. 
  

	5.3	Corporate Organization 

 Whenever there is: 

 

	 	(a)	a reclassification of outstanding Shares, a change of Shares into other shares or securities, or any other capital reorganization of either Company, other than as described in Sections 5.1 or 5.2;

  

	 	(b)	a consolidation, merger or amalgamation of either Company with or into another corporation resulting in a reclassification of outstanding Shares into other shares or securities or a change of Shares into other shares or
securities other than a Change of Control; or 

  

	 	(c)	a transaction whereby all or substantially all of either Company’s undertaking and assets become the property of another corporation other than a Change of Control; 

 (any such event being herein called a “Corporate Reorganization”) the Optionee will have an
option to purchase (at the times, for the consideration, and subject to the terms and conditions set out in the Plan) and will accept on the exercise of such option, in lieu of the Unissued Option Securities which the Optionee would otherwise have
been entitled to purchase, the kind and amount of shares or other securities or property that he would have been entitled to receive as a result of the Corporate Reorganization if, on the effective date thereof, the Optionee had been the holder of
all Unissued Option Securities or if appropriate, as otherwise determined by the Board. 
  

	5.4	Determination of Option Price and Number of Unissued Option Securities 

 If any questions arise at any
time with respect to the Option Price or number of Unissued Option Securities deliverable upon exercise of an Option following a Share Reorganization, Special Distribution or Corporate Reorganization, such questions shall be conclusively determined
by the Companies auditor, or, if they decline to so act, any other firm of Chartered Accountants in Vancouver, British Columbia or Certified Public Accountants in Seattle, Washington, that the Board may designate and who will have access to all
appropriate records and such determination will be binding upon the Companies and all Optionees. 
  

	6.	GOING PUBLIC AGREEMENTS 

  

	6.1	Going Public Agreements 

 If either Company proceeds to list any of its Shares on a public stock exchange
or commences a public offering, each Optionee will promptly enter into all such escrow, pooling or other agreements with respect to the Option Securities to which it is entitled as are required by the securities regulatory authorities, the exchange,
the agents or the underwriters in connection with such listing or public offering. 
  

	7.	MISCELLANEOUS 

  

	7.1	Right to Employment 

 Neither this Plan nor any of the provisions hereof shall confer upon any Optionee
any right with respect to employment or continued employment with a Company or any Affiliate of a Company or interfere in any way with the right of a Company or any Affiliate of a Company to terminate such employment. 

 

	7.2	Necessary Approvals 

 The granting of any Option under the Plan and the obligation of the Companies to
sell and deliver Option Securities in accordance with the Plan is subject to compliance with all applicable laws, including the approval of any governmental authority having jurisdiction. If any Option cannot be granted or any Option Securities
cannot be issued to any Optionee for any reason, including, without limitation, the failure to comply with such laws or obtain such approval, then the obligation of the Companies, as applicable, to grant such Option or issue such Option Securities
shall terminate and any Option Price paid by an Optionee to a Company for such Option Securities shall be immediately refunded to the Optionee such Company. 

	7.3	United States Securities Restrictions 

 The following provisions shall apply unless the Board determines
that compliance therewith is not required under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the United States: 

 

	 	(a)	Unless the Option Securities have been registered under the U.S. Securities Act, all stock certificates evidencing Option Securities issued under the Plan shall be impressed with a legend in substantially the following
form: 

 “THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY APPLICABLE STATE. SUCH SECURITIES MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO REGISTRATION UNDER SUCH LAWS OR AN EXEMPTION THEREFROM.”; and 

 

	 	(b)	If either Company determines that the exemption from registration provided by Rule 701 under the U.S. Securities Act is not available with respect to any Option grant or any issuance of Option Securities, the Companies
may condition the grant of such Option or the issuance of such Option Securities upon the Optionee providing satisfactory evidence to the Companies of the availability of the exclusion from registration provided by Regulation S under the U.S.
Securities Act or exemptions from registration under the U.S. Securities Act and applicable state securities laws. The legend impressed on the stock certificates evidencing any Option Securities issued in reliance upon Regulation S under the U.S.
Securities Act shall include an additional sentence noting the applicable restrictions on hedging transactions. 

  

	7.4	Administration of the Plan 

 The Board shall, without limitation, have full and final authority in their
discretion, but subject to the express provisions of the Plan, to interpret the Plan, to prescribe, amend and rescind rules and regulations relating to the Plan and to make all other determinations deemed necessary or advisable in respect of the
Plan. Except as set forth in Section 5.4, the interpretation and construction of any provision of the Plan by the Board shall be final and conclusive. Administration of the Plan shall be the responsibility of the appropriate officers of the
Companies and all costs in respect thereof shall be paid by the Companies. Neither of the Companies nor any member of the Board or any person acting pursuant to authority delegated by the Board hereunder will be liable for any action or
determination in connection with the Plan made or taken in good faith. 

	7.5	Income Taxes 

 At the time an Option is exercised by an Optionee, in whole or in part, or at any time
thereafter as requested by the Companies, such Optionee hereby authorizes withholding from payroll and any other amounts payable to such Optionee, and otherwise agrees to make adequate provision for (including by means of a cashless exercise to the
extent permitted by the Companies), any sums required to satisfy the federal, state, provincial, local and foreign tax withholding obligations, if any, which arise in connection with such Option, including, without limitation, obligations arising
upon (a) the exercise, in whole or in part, of such Option, (b) the transfer, in whole or in part, of any shares acquired upon exercise of such Option, (c) the operation of any law or regulation providing for the imputation of
interest, or (d) the lapsing of any restriction with respect to any shares acquired upon exercise of such Option. The Companies shall have no obligation to deliver shares of stock until the tax withholding obligations of the Optionee have been
satisfied by the Optionee. In order to assist an Optionee in paying all or a portion of the taxes to be withheld or collected upon exercise or receipt of (or the lapse of restrictions relating to) an Option, the Board, in its discretion and subject
to such additional terms and conditions as it may adopt, may permit the Optionee to satisfy such tax obligation by (i) electing to have applicable Company withhold a portion of the Shares otherwise to be delivered by such Company upon exercise
or receipt of such Option with a Fair Market Value equal to the amount of such taxes or (ii) delivering to the applicable Company securities, other than Option Securities issueable upon exercise or receipt of such Option, with a Fair Market
Value equal to the amount of such taxes. The election, if any, must be made on or before the date that the amount of tax to be withheld is determined. 
  

	7.6	Amendments to the Plan 

 The Board may from time to time, subject to applicable law and to the prior
approval, if required, of any regulatory body having authority over either of the Companies or the Plan, suspend, terminate or discontinue the Plan at any time, or amend or revise the terms of the Plan or of any Option granted under the Plan and the
Option Agreement relating thereto, provided that no such amendment, revision, suspension, termination or discontinuance shall in any manner adversely affect any Option previously granted to an Optionee under the Plan without the consent of that
Optionee, except such consent shall not be required in the circumstances described in Section 4.6. For greater certainty, nothing in the Plan shall limit the Board’s ability to grant Options under the Plan on terms that may be different or
more favorable to an Optionee than those specified herein. The Board of Directors of a Company may waive any conditions of or rights of such Company under any outstanding Options, prospectively or retroactively. 

 

	7.7	Notice 

 Prior to the Exchange Time a notice given to the Companies shall be in writing, signed by the
Optionee and delivered to the Secretary of Aquinox Canada, on behalf the Companies and from and after the Exchange Time a notice given to the Companies shall be in writing, signed by the Optionee and delivered to the Secretary of Aquinox US, on
behalf the Companies. Any notice or other communication contemplated under the Plan to be given by the Companies to an Optionee will be given by the Companies delivering or faxing the notice to the Optionee at the last address for the Optionee in
the Companies’ records. Any such notice will be deemed to have been given 

 
on the date on which it was delivered, or in the case of fax, the next business day after transmission. An Optionee may, at any time, advise the Companies of a change in the Optionee’s
address or fax number. 
  

	7.8	No Representation or Warranty 

 Neither Company makes any representation or warranty as to the future
market value of any Shares issued in accordance with the provisions of the Plan. 
  

	7.9	Compliance with Applicable Law 

 If any provision of the Plan or any Option Agreement contravenes any law
or any order, policy, by-law or regulation of any regulatory body having authority over either Company or the Plan, then such provision shall be deemed to be amended to the extent required to bring such provision into compliance therewith. 

 

	7.10	No Assignment 

 No Optionee may assign any of his or her rights under the Plan without the consent of the
Board. 
  

	7.11	Rights of Optionees 

 An Optionee shall have no rights whatsoever as a shareholder of either Company in
respect of any of the Unissued Option Securities (including, without limitation, voting rights or any right to receive dividends, warrants or rights under any rights offering). 

 

	7.12	Conflict 

 In the event of any conflict between the provisions of this Plan and an Option Agreement, the
provisions of this Plan shall govern. 
  

	7.13	Governing Law 

 The Plan and each Option Agreement issued pursuant to the Plan shall be governed by the
laws of the province of British Columbia. 
  

	7.14	Time of Essence 

 Time is of the essence of this Plan and of each Option Agreement. No extension of time
will be deemed to be or to operate as a waiver of the essentiality of time. 
  

	7.15	Entire Agreement 

 This Plan and the Option Agreements entered into between the Companies and the
Optionees from time to time set out the entire agreement between the Companies and the Optionees relative to the subject matter hereof and supersedes all prior agreements, undertakings and understandings, whether oral or written. 

 APPROVED BY THE BOARDS OF DIRECTORS OF AQUINOX CANADA AND AQUINOX US EFFECTIVE JUNE 8, 2007

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