Exhibit 10.3

LOCK UP AGREEMENT

September 8, 2006

Callisto Pharmaceuticals, Inc.
420 Lexington Avenue, Suite 1609
New York, NY 10170
Attention:  Gary S. Jacob

Ladies and Gentlemen:

Callisto Pharmaceuticals, Inc., a Delaware corporation (the “Company”), offered
(the “Offering”) shares (the “Shares”) of its common stock, par value $0.0001
per share (the “Common Stock”) and warrants to purchase Common Stock (the
“Warrants”) to certain accredited investors in a private offering, in exchange
for, among other things, the agreements contained in this letter.

In exchange for the Shares and Warrants, the undersigned hereby agrees that the
undersigned will not without the prior written consent of the Company, during
the period beginning on September 1, 2006 and ending on May 31, 2007, (1) offer,
pledge, announce the intention to sell, sell, contract to sell, sell any option
or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase, or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock (including without
limitation, Common Stock which may be deemed to be beneficially owned by the
undersigned in accordance with the rules and regulations of the Securities and
Exchange Commission and securities which may be issued upon exercise of a stock
option or warrant), acquired by investor, directly or indirectly, from the
Company in a private placement in February or April 2006 and set forth on
Schedule A hereto, or (2) enter into any swap or other agreement that transfers,
in whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or such other securities, in cash or
otherwise.

Notwithstanding the foregoing, the restrictions set forth in clause (1) and (2)
above shall not apply to (a) transfers (i) as a bona fide gift or gifts,
provided that the donee or donees thereof agree to be bound in writing by the
restrictions set forth herein, (ii) to any trust for the direct or indirect
benefit of the undersigned or the immediate family of the undersigned, provided
that the trustee of the trust agrees to be bound in writing by the restrictions
set forth herein, and provided further that any such transfer shall not involve
a disposition for value, or (iii) effected pursuant to any exchange of
“underwater” options with the Company, (b) the acquisition or exercise of any
stock option issued pursuant to the Company’s existing stock option plan,
including any exercise effected by the delivery of Securities of the Company
held by the undersigned, or (c) the

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establishment of any 10b5-1 selling plan provided the initial sale date under
such plan occurs after the end of the lock-up period described above.  For
purposes of this Letter Agreement, “immediate family” shall mean any
relationship by blood, marriage or adoption, not more remote than first cousin. 
None of the restrictions set forth in this Letter Agreement shall apply to
Common Stock acquired in open market transactions.

In furtherance of the foregoing, the Company, and any duly appointed transfer
agent for the registration or transfer of the securities described herein, are
hereby authorized to decline to make any transfer of securities if such transfer
would constitute a violation or breach of this Lock-up Agreement.

The undersigned hereby represents and warrants that the undersigned has full
power and authority to enter into this Lock-up Agreement. All authority herein
conferred or agreed to be conferred and any obligations of the undersigned shall
be binding upon the successors, assigns, heirs or personal representatives of
the undersigned.

This lock-up agreement shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflict of laws principles
thereof.

 

Very truly yours,

 

 

 

 

 

 

[Name of Person or Entity]

 

 

 

 

 

By:

 

 

 

Title:

 

 

Accepted as of the date first set forth above, September 8, 2006:

 

 

 

CALLISTO PHARMACEUTICALS, INC.

 

 

 

 

 

By:

 

 

 

Name: Gary S. Jacob

 

Title:   Chief Executive Officer

 

SCHEDULE A

Shares:

 

 

 

 

 

Warrants:

 

 

 

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