Document:

[ * ] CERTAIN
CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED

 

Exhibit 10.1

 

PATENT LICENSE

L99094

 

 

BY AND BETWEEN

 

The CENTRE NATIONAL DE RECHERCHE SCIENTIFIQUE,
a scientific and technological public establishment, having a registered office
at 3 rue Michel-Ange - 75794 PARIS Cedex 16 - France, represented by its
General Manager, Mrs. Catherine BRECHIGNAC, hereafter referred to as “CNRS”,
acting on its own name and on behalf of:

•                  the “Centre d’Etudes
d’Océanographie et de Biologie Marine”, Unité Propre de Recherche CNRS
n° 9042, CNRS- Station Biologique, BP 74, Place Georges Teissier, 29682
ROSCOFF Cedex - France,

•                  the “Unité de
Conception, de Synthèse et Vectorisation d’Antitumoraux et Antiviraux” - UMR
176 - CNRS/Institut Curie - Section de Recherche, Institut Curie- 26 rue
d’Ulm - 75248 PARIS - Cedex 05 - France,

hereinafter
called “LABORATORIES”

 

 

INSTITUT CURIE
a private, non profit foundation of
public interest having a registered office at 26 rue d’Ulm - 75248 Paris cedex
05 - France, represented by Mr. Jean-Marc BRUEL, President of the Board of
Directors, hereafter referred to as “CURIE”, acting in its own name
and in the name of and on behalf of “Unité de Conception, de Synthèse et
Vectorisation d’Antitumoraux et Antiviraux” - UMR 176 - CNRS/Institut Curie -
Section de Recherche, Institut Curie- 26 rue d’Ulm - 75248 PARIS - Cedex 05
- France,

 

The CNRS and CURIE are jointly hereafter
referred to as the “ESTABLISHMENTS”

 

	
   

  	
  ON ONE HAND

  

 

 

AND

 

 

CYCLACEL a limited liability company in the United Kingdom whose registered
office is - 12 St James’s Square - London - SW1Y4RB - United Kingdom whose
intracommunity VAT N° is 672 2290 40 represented by Mr. S.G. ROMBOTIS, Chief
Executive hereafter referred to as “CYCLACEL”

 

	
   

  	
  ON THE OTHER HAND

  

 

1

 

WHEREAS:

 

The “Centre d’Etudes d’Océanographie et de
Biologie Marine”, Unité Propre de Recherche CNRS n° 9042 and in particular, the
group directed by Mr. Laurent MEIJER has been working for many years on the
cell cycle field and in particular on cdc kinase used as a target for blocking
cell division.

 

Certain research performed in this
laboratory and concerning cdc kinase inhibitors has resulted in the filing of
the French patent application N° 9514237 entitled “Nouveaux dérivés de purine possédant
notamment des propriétés anti-prolifératives et leurs applications biologiques”,
filed on December 1st, 1995 in the name of the CNRS, which
was extended by an international patent application, PCT n°96/01905 entitled “Novel purine
derivatives having, in particular, antiproliferative properties, and biological
uses thereof” filed on November 29th, 1996, naming
as inventors, Emile BISAGNI, Michel LEGRAVEREND, Laurent MEIJER and Miroslav
STRNAD, and naming the United States, Europe (European Patent Application),
Canada and Japan.

 

The development of some research for this
invention was performed in part by Emile BISAGNI, and Michel LEGRAVEREND at the
“Unité de Conception, de Synthèse et Vectorisation d’Antitumoraux et
Antiviraux”, Unité Mixte de Recherche CNRS-Institut Curie N°176.

 

The development of some research for this
invention was performed in part by Miroslav STRNAD at the INSTITUTE OF
EXPERIMENTAL BOTANY, Academy of Science of the Czech Republic, Rozvojova 135,
165 02 Praha 6 - Lysolaje - the Czech Republic (hereafter referred to as
“IEB”). IEB has expressed its desire to be a co-owner of the CONTRACT PATENTS.

 

On February 13, 1999 the CNRS and IEB
signed a joint patent agreement n°L98095 for the CONTRACT PATENTS in order to
formalize the rules applicable to the joint ownership of the CONTRACT PATENTS
and the rights and obligations resulting therefrom. CNRS has been chosen to be
the party which shall identify and contact potential partners for the
exploitation of the CONTRACT PATENTS, and negotiate, conclude, or modify
exclusive and non-exclusive licenses or assignments under the CONTRACT PATENTS.

 

The CNRS hereby agrees not to abandon said
role as Exploitation Manager during the term of the present Agreement. A copy
of the joint patent agreement n°L98095 is in Annex IV of the present Agreement.

 

CYCLACEL, was created in 1996 for the
purpose of commercially exploiting certain technologies, in particular those
relating to certain novel peptides, small molecules and genes related to cell
cycle control. These technologies could benefit from the technologies which have
been developed by the ESTABLISHMENTS mentioned herein and CYCLACEL has
expressed an interest in obtaining a patent license from the ESTABLISHMENTS for
the research work mentioned herein in certain therapeutic fields.

 

2

 

In order to facilitate the exchange of
information between CYCLACEL and the ESTABLISHMENTS, a confidentiality
agreement was entered into on August 12, 1997 by and between CYCLACEL and
FIST who was acting in the name and on behalf of the CNRS.

 

CYCLACEL has expressed an interest in
obtaining an exclusive license under the CONTRACT PATENTS to make, have made,
sell, use, and otherwise commercially exploit the CONTRACT PRODUCTS in the
CONTRACT FIELD and the CONTRACT TERRITORY.

 

In accordance with the agreement between
the CNRS and CURIE dated June 17, 1994, the CNRS is responsible for
implementing the ESTABLISHMENTS obligations in the present Agreement.

 

NOW, THEREFORE THE PARTIES AGREE AS
FOLLOWS:

 

Preliminary Article - DEFINITIONS

 

AFFILIATES shall mean any legal entity
which, at the EFFECTIVE DATE:

 

•         directly or indirectly controls CYCLACEL; or

•         is under the same direct or indirect control as CYCLACEL; or

•         is directly or indirectly controlled by CYCLACEL.

 

A legal entity is considered as controlling another:

•         when it directly or indirectly owns over 50% (fifty percent) of the
capital of this legal entity or more than 50% (fifty percent) of the voting
rights of its shareholders or associates; or

•         when it has the direct or indirect de facto, directly or indirectly,
the power to decide within this legal entity how the affairs shall be
conducted.

 

BLOCKING IP shall mean any and all
patent rights other than the CONTRACT PATENTS licensed hereunder which may
dominate or block development, manufacture, use, or sale of CONTRACT PRODUCT in
the CONTRACT FIELD and the CONTRACT TERRITORY.

 

CONFIDENTIALITY AGREEMENT means the
confidentiality agreement entered into on August, 12, 1997 by and between
CYCLACEL and FIST who was acting in the name and on behalf of the CNRS.

 

CONTRACT FIELD shall mean the
applications of the CONTRACT PATENTS in the six (6) following fields of
application: auto-immune diseases, cardiovascular diseases, dermatological
diseases, infectious diseases, inflammatory diseases and proliferative diseases
(in particular cancers).

For the avoidance of doubt, it is hereby agreed that the CONTRACT FIELD
shall not include the domain of non-acute chronic diseases of the central
nervous system, neurological diseases or diseases of the peripheral nervous
system.

 

CONTRACT PATENTS shall mean French
patent application N°9514237, entitled “Nouveaux dérivés de purine possédant notamment des
propriétés anti-prolifératives et

 

3

 

leurs applications biologiques”,
filed on December 1st, 1995 in the name of the CNRS, the
international patent application, PCT n°96/01905 entitled “Novel purine derivatives having, in
particular, antiproliferative properties, and biological uses thereof”
filed on November 29th, 1996, naming as inventors, Emile
BISAGNI, Michel LEGRAVEREND, Laurent MEIJER and Miroslav STRNAD, as well as any
continuations, divisions, or extensions thereof, including patent term
extensions, including but not limited to Supplementary Protection Certificates
or Waxman-Hatch extensions, any foreign counterparts thereof and any patents
which issue therefrom in any country, as set out in Annex I.

It is hereby understood that any improvement of the CONTRACT PATENT
that is protected by a patent shall not be considered as a CONTRACT PATENT. For
the avoidance of doubt CYCLACEL has the clear right to patent in its own name
any derivative compounds falling within the broad compound family of the
CONTRACT PATENT.

 

CONTRACT PRODUCTS, shall mean any
products which are covered by the CONTRACT PATENTS or which could not be
identified, developed, manufactured, used or sold without infringing upon at
least one of the claims of the CONTRACT PATENTS.

 

CONTRACT TERRITORY shall mean the
entire world.

 

EFFECTIVE COMPETITION shall mean a
situation in which one or more third parties, in a country of the CONTRACT
TERRITORY, is marketing a product, which competes with a CONTRACT PRODUCT in
the CONTRACT FIELD and the third party’s product’s sales for a calendar quarter
are [*] of the total sales of such CONTRACT PRODUCT in such country expressed
in equivalent units. The third party sales determination in any calendar
quarter is conclusively deemed to be [*] of the total sales of all CONTRACT
PRODUCTS in such country, if a market research organization such as IMS has
made such determination based on its conduct of a market share study, in such
country, during such quarter. Once a determination is made that EFFECTIVE
COMPETITION exists for a CONTRACT PRODUCT in any country, such determination
shall be made again each calendar quarter for so long as such CONTRACT PRODUCT
is marketed in that country.

 

EFFECTIVE DATE, shall mean the last
date of signature of the present Agreement by the PARTIES.

 

FIRST COMMERCIAL SALE shall mean the
first commercial sale of the CONTRACT PRODUCTS to a third party made by either
CYCLACEL or its AFFILIATES after marketing authorization is received from the
US Food and Drug Administration (FDA) or from any equivalent administrative
body in any country of the CONTRACT TERRITORY.

 

NET SALES, shall mean the gross amount
invoiced by CYCLACEL and its AFFILIATES to their customers including
distributors, for sales of CONTRACT PRODUCTS, less any normal trade discounts
and credit notes issued in respect of

 

4

 

returned CONTRACT PRODUCTS, purchase, sales, import,
or value added taxes and charges in respect to carriage.

Should CYCLACEL sell CONTRACT PRODUCTS to an AFFILIATE (or vice-versa)
which thereafter sell them to an unrelated third party, the sales between the
AFFILIATE (or CYCLACEL) and the unrelated third party (and not the sales
between CYCLACEL and its AFFILIATE) shall be considered NET SALES.

It is hereby understood that the sales by SUBLICENSEES shall not be
considered as NET SALES.

 

PARTIES, shall mean the ESTABLISHMENTS
and CYCLACEL.

 

SUBLICENSEES, shall mean any third
parties who may obtain a sublicense from CYCLACEL to develop and/or
commercially exploit the CONTRACT PRODUCTS in the CONTRACT FIELD.

 

VALID CLAIM shall mean any claim of an
issued and unexpired patent or a claim of a pending patent application within
the CONTRACT PATENTS which has not been held unpatentable, invalid or
unenforceable by a court or other government agency of competent jurisdiction
and has not been admitted to be invalid or unenforceable through reissue,
re-examination, disclaimer or otherwise; provided, however, that if the holding
of such court or agency is later reversed by a court or agency with overriding
authority, the claim shall be reinstated as a VALID CLAIM after the date of
such reversal.

 

All plurals may be read in the singular and vice
versa.

 

Article 1 - OBJECT NATURE AND SCOPE OF THE AGREEMENT

 

1.1                                 The ESTABLISHMENTS hereby grant CYCLACEL which accepts, subject to
the terms and conditions of the present Agreement, an exclusive license under
the CONTRACT PATENTS to make, have made, sell, use, and otherwise commercially
exploit the CONTRACT PRODUCTS in the CONTRACT FIELD and the CONTRACT TERRITORY.

 

CNRS will not commercially exploit the CONTRACT
PATENTS in the CONTRACT FIELD for the duration of the present Agreement. The
ESTABLISHMENTS shall be free to use the CONTRACT PATENTS for internal research
purposes only.

 

1.2                                 The right to license granted to CYCLACEL by the ESTABLISHMENTS
includes the right to grant sublicenses.

 

1.3                                 For the avoidance of doubt, the license which is hereby granted to
CYCLACEL is for the CONTRACT PATENTS. This license does not give CYCLACEL any
rights to compounds developed in the LABORATORIES which are not protected by at
least one of the claims of the CONTRACT PATENTS.

 

However, if CYCLACEL makes developments on CDK
inhibitors corresponding to the composition of matter disclosed in claims 1 to
9 of the international patent application, PCT n°96/01905 entitled “Novel purine
derivatives having, in particular,

 

5

 

antiproliferative properties, and biological uses thereof”as filed on November 29th, 1996, and if these
compounds are not protected by said patent as issued, the ESTABLISHMENTS agree
to make reasonable efforts to grant licenses to CYCLACEL under all patents
covering these CDK inhibitors in the CONTRACT FIELD, filed in the name of the
CNRS and/or CURIE, and developed by the LABORATORIES.

 

Thus, it is hereby agreed that said licenses shall be
granted to CYCLACEL only if the ESTABLISHMENTS have the freedom to grant them
in the CONTRACT FIELD, and will be subject to existing third party rights.

 

If the ESTABLISHMENTS have the freedom to grant said
licenses, the terms that would apply shall be no more onerous to CYCLACEL than
those in the present Agreement and will exclude any fee for [*] as the PARTIES
consider these elements to have already been fully compensated for in the
present Agreement by the payments as set out in Article 5.1 herein.

 

If the ESTABLISHMENTS do not have the freedom to grant
said licenses, because a third party has rights on said patents, CYCLACEL will
have to negotiate and obtain a license from said third party. However, the
ESTABLISHMENTS agree to make reasonable efforts, if requested by CYCLACEL, to
assist CYCLACEL in obtaining such rights from said third party.

In this case, in the event that CYCLACEL
has to pay royalties to said third party to commercially exploit CONTRACT
PRODUCTS, the provisions set out in Article 5.2.2 herein shall apply.

 

Article 2 - TERM

 

The present Agreement shall take effect at the
EFFECTIVE DATE and unless earlier terminated in accordance with the terms
herein shall remain in effect on a country by country basis for the life of the
last of the CONTRACT PATENTS in said country or for 10 (ten) years from the
FIRST COMMERCIAL SALE in said country, whichever occurs later.

 

Article 3 - SUBLICENSES

 

3.1                                 Pursuant to Article 1.2, CYCLACEL may grant sublicenses to SUBLICENSEES
subject to prior notification to the ESTABLISHMENTS by registered letter with
acknowledgement of receipt of the name of any proposed SUBLICENSEE and the
terms of such proposed sublicenses.

 

3.2                                 CYCLACEL agrees to include within the terms of any sublicenses a
clause that permits CYCLACEL to show to the ESTABLISHMENTS a copy of the
SUBLICENSEE’s accounts to CYCLACEL to prove they are consistent with the
obligations of CYCLACEL hereunder.

 

3.3                                 CYCLACEL shall include within the terms of any sublicense a similar
obligation of confidentiality as that set out in Article 8 herein, as set
out in Article 8.2.

 

6

 

3.4                                 CYCLACEL agrees to include within the terms of any sublicense
royalties which are at least as favorable to CYCLACEL as those in the present
Agreement are for the ESTABLISHMENTS. CYCLACEL shall be solely responsible for
the correct execution of the obligations of SUBLICENSEES in said sublicenses
pursuant to Article 3.5 herein.

 

3.5                                 Should termination of the present Agreement occur, any payments due
by SUBLICENSEES to CYCLACEL with effect from the date of termination shall be
payable directly to the ESTABLISHMENTS and CYCLACEL shall make reasonable
efforts to ensure that clauses are included in any sublicense to this effect.

 

3.6                                 The ESTABLISHMENTS will be obliged upon request of a SUBLICENSEE of
CYCLACEL to provide such SUBLICENSEE with an undertaking that in the event that
the present Agreement is terminated the ESTABLISHMENTS shall enter into a direct
license with the SUBLICENSEE on no less favorable terms. In that case a new
agreement will be signed between the ESTABLISHMENT and this SUBLICENSEE.

 

Article 4 - TRANSFER

 

4.1                                 The present Agreement is granted intuitu personae. It is therefore
personal, non-transferable and non-assignable. It is hereby agreed that the
present Article does not prevent CYCLACEL from granting sublicenses.

 

4.2                                 In case of the majority take-over, merger, transfer of CYCLACEL or
transfer of its activity to another company other than an AFFILIATE, or any
other transformation of CYCLACEL which modifies the intuitu personae nature of
the present Agreement, the present Agreement shall only be assigned or
transferred with the consent of the ESTABLISHMENTS, which consent shall not be unreasonably
withheld or delayed.

 

It is hereby understood that any company to which
CYCLACEL’s rights and obligations are assigned, shall be subject to the same
obligations as those of CYCLACEL herein, unless the contracting parties should
reach another mutual agreement.

 

For the avoidance of doubt, any changes to the terms
and conditions of the present Agreement which are agreed to and occur as a
result of said transfer, for example, the name and address of the assignee,
shall be set out in writing, signed by the ESTABLISHMENTS and CYCLACEL and
included as an amendment to the present Agreement at the same time as said
majority take-over merger or transfer of CYCLACEL occurs.

 

Article 5 - FINANCIAL CONDITIONS

 

5.1                                 The present license is granted in exchange for payment by CYCLACEL
to the ESTABLISHMENTS of:

•                  [*] due upon the EFFECTIVE DATE;

 

7

 

•                  [*] due at each anniversary date of the EFFECTIVE DATE in exchange
for maintaining exclusivity until either US CONTRACT PATENT is officially
published as granted or a European CONTRACT PATENT is officially published as
granted, whichever is sooner;

•                  [*] due once, when the US CONTRACT PATENT(S) containing the claims
as defined in Annex II is/are officially published as granted;

•                  [*] when a European CONTRACT PATENT is officially published as
granted and the claims defined in Annex II issued;

•                  [*] for each commercialized CONTRACT PRODUCT due on the FIRST
COMMERCIAL SALE for each and every new chemical entity, regardless of
formulation changes, stereo-isomer change, salt form, in each of the 6 (six)
fields of application in the CONTRACT FIELD.

 

CYCLACEL shall inform the ESTABLISHMENTS in writing of
the dates of each FIRST COMMERCIAL SALE, allowing for a delay of 2 (two) months
following the occurrence of each of these FIRST COMMERCIAL SALES.

 

Should the conditions defined in Annex II not be met,
the PARTIES may sign an addendum to the present Agreement which will set out
new lump sum payments which would reflect the reduced protection offered by the
CONTRACT PATENTS or CYCLACEL may terminate the agreement subject to the
termination procedure set out in Article 12 herein.

 

5.2                                 Moreover, the ESTABLISHMENTS should receive royalties,

 

	
  5.2.1

  	
  •

  	
   

  	
  of [*] of NET SALES in countries in which the CONTRACT PRODUCTS are
  protected by at least one VALID CLAIM;

  
	
   

  	
  •

  	
   

  	
  of
  [*] of NET SALES of CONTRACT PRODUCTS in all other cases.

  
	
   

  	
   

  
	
  5.2.2

  	
  If at any time prior to or during the period when royalties fall due
  hereunder in relation to any particular country, it is necessary or advisable
  to take a license to any BLOCKING IP and therefore the cumulative royalties
  expressed as a percentage of NET SALES payable to licensors of such BLOCKING
  IP and the ESTABLISHMENTS exceed 5%, then the ESTABLISHMENTS agree that the
  royalties payable to the ESTABLISHMENTS in such country may be reduced to a
  percentage calculated as follows, subject to providing written proof of said
  royalties paid by CYCLACEL to third parties in such country:

  
	
   

  	
   

  
	
   

  	
  •

  	
   

  	
  [*]
  of the NET SALES of the CONTRACT PRODUCTS, if the cumulative royalty rate due
  by CYCLACEL for any BLOCKING IP and for the present Agreement, is greater
  than [*] and less than [*];

  
					

 

8

 

	
   

  	
  •

  	
   

  	
  [*] of the
  NET SALES of the CONTRACT PRODUCTS if the cumulative royalty rate due by
  CYCLACEL for any BLOCKING IP and for the present Agreement is greater than
  [*] and less than [*];

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  •

  	
   

  	
  [*]
  of the NET SALES of the CONTRACT PRODUCTS if the cumulative royalty rate due
  by CYCLACEL for any BLOCKING IP and for the present Agreement is greater than
  or equal [*].

  
	
   

  	
   

  
	
   

  	
  Said
  royalty rates shall be reduced by [*] in countries in which the CONTRACT
  PRODUCTS are not protected by at least one VALID CLAIM of the CONTRACT
  PATENTS.

  

 

Royalties as set out in Articles 5.2.1 and 5.2.2,
shall be payable on a country by country basis for as long as there are a VALID
CLAIM of CONTRACT PATENTS in that country or 10 years from the FIRST COMMERCIAL
SALE of CONTRACT PRODUCT in that country, which ever is longer.

 

An addendum to the present Agreement which sets out
the rate of royalties for said CONTRACT PRODUCTS on a country by country basis
shall be signed by the PARTIES. In no event shall any modifications in the
royalty rate be retroactive. Any modifications shall take effect on
April 1 of the year following the modification.

 

	
  5.2.3

  	
  Should
  the claims of the CONTRACT PATENTS set out in Annex II of the present
  Agreement not be granted neither by the European Patent Office (“EPO”) nor by
  the US Patent and Trademark Office (“USPTO”), then the PARTIES shall, at the
  written request of CYCLACEL, sign an addendum to the present Agreement which
  sets out a new royalty rate due by CYCLACEL or terminate the present
  Agreement subject to the termination procedure set out in Article 12
  herein.

  

 

	
   

  	
  For
  the avoidance of doubt, should the claims of the CONTRACT PATENTS set out in
  Annex II of the present Agreement not be granted by the EPO but granted by
  the USPTO, or granted by the EPO but not granted by the USPTO, then the
  provisions of Articles 5.2.1 and 5.2.2 shall apply.

  

 

5.3                                 CYCLACEL shall pay to the ESTABLISHMENTS [*] of all payments (lump
sum payments, royalties...) made by SUBLICENSEES to CYCLACEL or to its
AFFILIATES, upon execution of any sublicense contracts, whether said payments
are due upon signature of said agreements or later.

 

Notwithstanding the previous paragraph, should
CYCLACEL take a CONTRACT PRODUCT into phase II clinical trials, the
ESTABLISHMENTS agree that the payment herein of [*] of all payments made by SUBLICENSEES
to CYCLACEL or to its AFFILIATES, upon execution of any sublicense contracts
concerning said CONTRACT PRODUCT shall be reduced to a percentage of 11%
(eleven percent).

 

9

 

Any payments made to CYCLACEL or its AFFILIATES by
SUBLICENSEES under normal market conditions, which are shown to be for
CYCLACEL’s research and development under collaborative research, shall not be
included in payments set out in present Article 5.3.

 

5.4                                 The payments properly due to the ESTABLISHMENTS under the present
Agreement shall in no event be refundable to CYCLACEL.

Furthermore, in the event of expiration or
termination of the present Agreement, CYCLACEL shall pay all and any sums due
to the ESTABLISHMENTS up to the expiration date or the date of termination.

 

5.5                                 Any payments due by CYCLACEL under the present Agreement shall be
paid in French Francs.

Pursuant to the European Union Treaty, the
French Franc shall be replaced by a single currency, the Euro.

In accordance with the general principles
of monetary law, any references to the Franc herein, shall be considered to be
references to the Euro by right.

 

The substitution of said terms shall not affect the
conditions or prevent the execution of the present Agreement and does not
confer the right to unilateral modification or termination of the present
Agreement by any of the PARTIES. Said substitution shall take effect on the
date of and pursuant to the terms set out by European Union regulations
pertaining thereto.

 

5.6                                 For the avoidance of doubt, if upon application of the
ESTABLISHMENTS, any withholding tax can be reduced, CYCLACEL will file an
application on behalf of the ESTABLISHMENTS for such reduction.

The ESTABLISHMENTS has provided CYCLACEL
with a form of proxy authorizing CYCLACEL to make such an application in its
behalf in Annex III.

 

5.7                                 Should the royalty rate change during fiscal year pursuant to the
terms of the present Agreement, it is hereby agreed that the existing rate
shall be applied until March 31 of the year in question.

 

Article 6 - ACCOUNTING-ROYALTIES

 

6.1                                 CYCLACEL shall prepare accounts, which shall include all the
elements necessary to precisely calculate the NET SALES within the framework of
the present Agreement.

 

6.2                                 If necessary these accounts shall be made available once a year with
30 days notice to the ESTABLISHMENTS or an accredited designee of the
ESTABLISHMENTS during the term of the present Agreement and for one year
thereafter.

 

6.3                                 These accounts shall be prepared annually within 90 (ninety) days of
the closing date of March 31 of each year which represents the end of
CYCLACEL’s fiscal year.

 

6.4                                 All payments shall be preceded by a sales report by country and by
SUBLICENSEE. On or before June 30 of every year this report shall be sent
to the Service Financier de la Délégation du Siège du CNRS, 3 rue Michel-Ange -
75794 PARIS Cedex 16. Said

 

10

 

report shall include the license number and the sales
figures used to calculate the royalties due to the ESTABLISHMENTS, as well as
the quantities sold, the unit price of any quantity of the CONTRACT PRODUCTS
and details of any revenue of any nature as set out in Article 5 of the
present Agreement, received for the commercial exploitation of the CONTRACT
PRODUCTS both by CYCLACEL, its AFFILIATES and its SUBLICENSEES.

 

6.5                                 Any sums due by CYCLACEL pursuant to Article 5 shall be paid
within the 35 (thirty five) days following issuance of an invoice from the
ESTABLISHMENTS to the person and the bank address indicated in Article 6.9
herein.

 

6.6                                 Should no sales occur, CYCLACEL shall nonetheless send the
ESTABLISHMENTS a sales-report in the month of June each year attesting to
such lack of sales during the period under consideration and stating the reasons
therefor and the difficulties encountered.

 

6.7                                 Any sums which remain unpaid within the periods set out hereunder
shall be subject to interest at the rate of [*] without prejudice to the
ESTABLISHMENTS’s right to terminate the contract in accordance with
Article 12 of the present Agreement. [*] accordance with law n° 89 [*].

 

6.8                                 To amounts due to the ESTABLISHMENTS shall be added the legal taxes
in effect at the date of payment, in particular VAT if applicable.

 

6.9                                 CYCLACEL shall make payments due to the CNRS, in the name of the
ESTABLISHMENTS, [*]

 

6.10                           The ESTABLISHMENTS shall have the right once a year with 30 days
notice to audit or have audited the royalty accounts kept by CYCLACEL. Should
there be an audit, an expert accountant shall be appointed by mutual agreement
of both PARTIES at the expense of the ESTABLISHMENTS, except that if the amount
of any royalties shown by such audit to be due to the ESTABLISHMENTS exceed the
amount actually paid by CYCLACEL by [*]

 

6.11                           If CYCLACEL justifies the existence of EFFECTIVE COMPETITION in any
of the countries of the CONTRACT TERRITORY, the PARTIES shall meet and
negotiate in good faith new financial conditions, for said countries, to be
mutually agreed by the PARTIES.

 

11

 

Article 7 - EXPLOITATION

 

7.1                                 CYCLACEL agrees to exploit the present license and to make
reasonable efforts to develop, make, have made, sell, use, and otherwise
commercially exploit the CONTRACT PRODUCTS.

 

7.2                                 CYCLACEL agrees to provide annual reports justifying the development
and exploitation of the CONTRACT PRODUCTS.

 

7.3                                 CYCLACEL, its AFFILIATES or SUBLICENSEES agree not to use the names
“Centre National de la Recherche Scientifique” or “CNRS” or “CURIE” or
“INSTITUT CURIE” or any trademark, distinctive sign or adaptations thereof
which belongs to the ESTABLISHMENTS or the names of the ESTABLISHMENTS
inventors or of any ESTABLISHMENTS agent, for commercial purposes, without
receiving prior written approval from the ESTABLISHMENTS and the natural person
concerned, as the case may be.

 

7.4                                 CYCLACEL, its AFFILIATES or SUBLICENSEES shall commercialize the
CONTRACT PRODUCTS under their own trademarks or under trademarks for which they
have obtained a license. The ESTABLISHMENTS shall have no rights to such
trademarks. All administrative authorizations obtained by CYCLACEL for the
purpose of manufacturing and/or commercializing the CONTRACT PRODUCTS shall be
obtained for CYCLACEL or for any party which it shall have designated and
subject to Article 7.5 hereunder, the ESTABLISHMENTS shall claim no rights
thereto.

 

7.5                                 Without prejudice to the terms of Article 7.4 hereunder,
CYCLACEL accepts the obligation to inform by writing the ESTABLISHMENTS of all
administrative authorizations, notably any official marketing approval that it
obtains for the purpose of manufacturing and/or commercializing the CONTRACT
PRODUCTS no later than [*] after obtaining such final authorizations.

 

7.6                                 CYCLACEL hereby confirms that it has the expertise necessary to make
use of the CONTRACT PATENTS, and to develop, make, have made, sell, use, and
otherwise commercially exploit the CONTRACT PRODUCTS.

 

Article 8 - CONFIDENTIALITY

 

8.1                                 Each PARTY agrees to respect and keep strictly confidential all
scientific and technical information belonging to the other PARTY and any other
information of any nature belonging to the other PARTY about which they may
have knowledge due the negotiations and execution of the present Agreement. The
PARTIES shall not use such information for any other purpose than the
performance of the present Agreement and shall only disclose this information
its employees on a strict need-to-know basis.

 

CYCLACEL shall be free to use all information for
submissions and communications with regulatory and governmental authorities as
required for the development of the CONTRACT PRODUCTS.

 

12

 

8.2                                 The PARTIES shall assure that their personnel and others in their
service are bound by the same obligations of confidentiality described
hereunder. Moreover, CYCLACEL shall include confidentiality obligations no less
onerous than the present Article 8 in any sublicenses it may grant to
SUBLICENSEES.

However, should the SUBLICENSEES have prior
activities or obligation concerning the use of cdc kinase inhibitors in the
CONTRACT FIELD, CYCLACEL shall make reasonable efforts to include
confidentiality obligations no less onerous than the present Article 8 in
any sublicenses.

 

8.3                                 The confidentiality obligations between the PARTIES in the present
Article 8 shall not include the use or disclosure of confidential
information that the receiving PARTY can show:

 

a)                   Was disclosed by the mutual agreement of the PARTIES, or was
disclosed by the owning PARTY; or

 

b)                  Was in the public domain at the moment of disclosure or entered the
public domain through no act or fault of the receiving PARTY; or

 

c)                   Was made available as a matter of lawful right by a third party
without breach of any of the confidentiality obligations herein; or

 

d)                  Was in the possession of the receiving PARTY at the time of
disclosure by the owning PARTY; or

 

e)                   Was disclosed by lawful right, to remain in compliance with a legal
or regulatory imperative, an arbitration settlement or a final legal decision;
or

 

f)                     Was disclosed after obtaining the prior authorization of the owning
PARTY; or

 

g)                  Was independently developed by or on behalf on the receiving PARTY
without use of any confidential information received from the owning PARTY.

 

8.4                                 The present Article shall remain in effect until the expiration
of the last of the CONTRACT PATENTS, the expiration or termination of the
present Agreement notwithstanding.

 

Article 9 - INTELLECTUAL PROPERTY

 

9.1                                 Any and all decisions concerning the maintenance of the intellectual
property necessary to the validity of the CONTRACT PATENTS shall belong
exclusively to the ESTABLISHMENTS. The ESTABLISHMENTS shall consult CYCLACEL in
relation to any decisions concerning the CONTRACT PATENTS, and agree to provide
CYCLACEL with copies of all relevant correspondence with patent authorities.
The ESTABLISHMENTS shall make reasonable efforts to take into consideration the
commercial strategy of CYCLACEL when taking actions in relation to prosecution
of the CONTRACT PATENTS in particular in the actions related to replies to
office actions especially including but not limited to those regarding support
of claim scope,

 

13

 

final text and agreement under Rule 51(4) reply in
addition to actions related to the filing of CIP and divisional applications in
relation to the CONTRACT PATENTS.

 

9.2                                 It is hereby agreed by the PARTIES that the French patent
application n° 9514237 filed on December 1st, 1995, in the name
of the CNRS was extended by an international patent application, PCT n°96/01905
entitled “Novel
purine derivatives having, in particular, antiproliferative properties, and
biological uses thereof”  filed on November 29th,
1996, and naming the United States, Europe (European Patent Application),
Canada and Japan.

 

It is hereby agreed by the PARTIES that the European
patent application shall name all following countries: France, Germany, United
Kingdom, Belgium, Italy, Spain, Austria, Switzerland, Liechtenstein, Denmark,
Finland, Greece, Ireland, Luxembourg, Monaco, the Netherlands, Portugal and
Sweden.

 

9.3                                 Should the ESTABLISHMENTS wish to abandon any one of the CONTRACT
PATENTS it shall notify CYCLACEL 2 (two) months prior to the next deadline for
payment of maintenance fees of said CONTRACT PATENTS. CYCLACEL may take over
the prosecution and maintenance of said CONTRACT PATENTS subject to notifying
the ESTABLISHMENTS no later than 1 (one) month prior to such payment deadline.
In this case the terms of the present Agreement shall remain in effect and
CYCLACEL shall be responsible for the maintenance fees for said CONTRACT
PATENT(S) and may deduct any annual amounts paid for this purpose from any of
the royalties due to the ESTABLISHMENTS for the same year, subject to providing
receipts for said amounts and including them in the corresponding sales report
addressed to the CNRS. All patent prosecution procedures for the CONTRACT
PATENTS shall be undertaken in the name of the ESTABLISHMENTS.

 

Should the CONTRACT PATENTS be licensed to a licensee
other than CYCLACEL, and should the ESTABLISHMENTS wish to abandon all or part
of said CONTRACT PATENTS, the present Article shall be amended in an
addendum to the present Agreement such that all licensees under the CONTRACT
PATENTS may share the intellectual property costs and prosecution
responsibilities thereto.

 

9.4                                 From the date of the FIRST COMMERCIAL SALE, should the annual
royalties pursuant to Article 6 herein fail to reimburse the annual
intellectual property fees due by the CNRS for the CONTRACT PATENTS in one, several
or all of the countries in   the
CONTRACT TERRITORY for 2 consecutive years the ESTABLISHMENTS shall be free to
abandon said CONTRACT PATENTS in said country (or countries) of the CONTRACT
TERRITORY.

Pursuant to Article 9.3 herein, CYCLACEL may take over prosecution
of said patents.

 

Article 10 - INFRINGEMENT

 

10.1                           Each PARTY shall inform the other within the shortest possible delay
of any third party infringement of which it may become aware and/or of any
infringement claims or actions, which may be taken against it.

 

14

 

10.2                           Should there be third party infringement of the CONTRACT PATENTS in
the CONTRACT FIELD, the ESTABLISHMENTS may, at their sole expense, undertake
legal action against the infringing party. Any damages which may be allotted in
relation to said infringement shall belong solely to the ESTABLISHMENTS.

The foregoing shall not prevent CYCLACEL
from intervening in any such action at its sole expense in compensation for
prejudice which it has incurred. Any indemnification or damages which may be
allotted by the courts will belong solely to CYCLACEL.

 

Should the ESTABLISHMENTS not wish to undertake any
action, CYCLACEL may, after having notified the ESTABLISHMENTS in writing, and
in the absence of response from the ESTABLISHMENTS in the month following such
notification, and subject to any applicable laws in the country in which the
infringement has occurred, take action against said infringement in its own
name and at its own expense. The costs of such actions shall be borne by
CYCLACEL and any damages awarded by court decision shall belong entirely to
CYCLACEL.

 

The PARTIES agree to provide any documents and
elements that may be necessary for the above-mentioned action to the other
PARTY.

 

10.3                           Should CYCLACEL, its AFFILIATES, SUBLICENSEES or distributors become
the object of infringement claims as a result of the use, manufacturing or
commercialization of the CONTRACT PRODUCTS, due to the use of the CONTRACT
PATENTS, the ESTABLISHMENTS shall not be held liable or held in guarantee by
CYCLACEL. During such infringement proceedings, should CYCLACEL, its AFFILIATES
or SUBLICENSEES be prohibited from selling the CONTRACT PRODUCTS, CYCLACEL may
suspend payments due herein, until termination of such proceedings. Should
CYCLACEL, its AFFILIATES or SUBLICENSEES continue selling CONTRACT PRODUCTS
during said proceedings, CYCLACEL may deduct any annual external legal costs
from its calculation of NET SALES for royalty payments due for the same year
pursuant to Article 6 herein and for the corresponding year, subject to
providing written proof of said costs.

 

Should said companies be condemned for said
infringement, the ESTABLISHMENTS shall not be called in warranty by CYCLACEL or
be liable to indemnify reimburse or reduce any of the sums due by CYCLACEL at
the moment of the final legal decision except as a result of a breach of a
warranty provided by the ESTABLISHMENTS pursuant to Article 11. Should any
or all of the CONTRACT PATENTS become null or void the conditions of
Article 11 shall be applicable without exception.

 

The present Article shall not in any way be
considered to constitute a waiver by the ESTABLISHMENTS to take any action or
intervention.

 

Article 11 - WARRANTIES

 

11.1                           The ESTABLISHMENTS warrant that they own the CONTRACT PATENTS, in
part or in whole, and that they have the right to grant CYCLACEL the license
herein, such right having been explicitly agreed in writing by and between the
ESTABLISHMENTS and IEB. The ESTABLISHMENTS warrant that their agreement with
IEB provides for a certain financial compensation to be paid by the
ESTABLISHMENTS to IEB and

 

15

 

that CYCLACEL will not be liable for any payments to
IEB for the license herein. The ESTABLISHMENTS agree that they will take all
necessary steps to record joint ownership of the CONTRACT PATENTS with the IEB
at each patent office in which the CONTRACT PATENTS were filed. The
ESTABLISHMENTS warrant that they are not aware of any patents that may be
infringed by the CONTRACT PATENTS.

 

Prior to signature of this agreement, the
ESTABLISHMENTS have supplied to CYCLACEL all documents in their possession
relating to the prosecution history of the CONTRACT PATENTS under the
CONFIDENTIALITY AGREEMENT to enable CYCLACEL to study each history.

 

11.2                           The hazards, risks and perils associated with the exercise of rights
granted under the present Agreement and any legal defects contained in the
CONTRACT PATENTS are the sole responsibility of CYCLACEL who hereby accepts
them. In consequence, should any of the CONTRACT PATENTS be invalidated,
annulled or be declared dependent upon a prior dominant patent, or should the
CONTRACT PRODUCTS be declared in infringement in a final legal decision, the
ESTABLISHMENTS shall not be liable to reimburse any sums acquired from
CYCLACEL, or to pay damages to CYCLACEL in retribution for prejudice caused for
such invalidation, cancellation or infringement.

 

The PARTIES shall meet to evaluate the effect of said
decision and to renegotiate in good faith if necessary, in an addendum to the
present Agreement, the financial terms of Article 5 of the present
Agreement or terminate the agreement at CYCLACEL’s absolute discretion in
accordance with the procedure set out in Article 12.2. All the remaining
terms of the present Agreement shall continue in full effect. In no event shall
any modifications in the royalty rate be retroactive. Any modifications shall
take effect on April 1 of the year following the modification.

 

In accordance with the present Article, the
ESTABLISHMENTS do not provide any express or implied guarantee of the CONTRACT
PATENTS in particular of their utility or application for any particular
function.

 

11.3                           CYCLACEL shall not call on the ESTABLISHMENTS in guarantee for any
damages or prejudice of any nature caused by the CONTRACT PRODUCTS. CYCLACEL is
solely responsible to its clients and/or any third parties for the quality and
performance of the CONTRACT PRODUCTS.

 

Article 12 - TERMINATION

 

12.1                           Should CYCLACEL cease business operations or be the object of a
liquidation procedure, the ESTABLISHMENTS may terminate the present Agreement
if it so wishes subject to notifying CYCLACEL. After 1 (one) month without a
response to this notification, and subject to the applicable legal regulations
in England and Wales, the present Agreement shall be immediately terminated by
right. Any termination under Article 12.1 will be subject to the
Insolvency Act 1986 of the laws of England and Wales.

 

16

 

12.2                           The present Agreement may be terminated by right by either of the
PARTIES in the event that the other PARTY fails to perform one or more of the
obligations contained in the various clauses of the present Agreement notably
Article 5. This termination shall only become effective 3 (three) months
after the complaining PARTY sends a notice exposing the motives of the
complaint and then only if the PARTY at fault has not, within this period,
fulfilled its obligations or shown proof of a case of force majeure that
prevented it from fulfilling its obligations. The exercise of such right to
termination does not exempt the PARTY in default from fulfilling the
obligations accrued prior to the date of termination and this, without
prejudice to any compensation due for damages incurred as a result early
termination of the agreement.

 

12.3                           In particular if after 5 (five) years from the EFFECTIVE DATE,
CYCLACEL has not submitted a regulatory application to a European government
authority to begin human clinical trials of CONTRACT PRODUCTS, and cannot
provide any reasonable justification for such failure the ESTABLISHMENTS may
terminate the present Agreement in accordance with the procedure set out in
Article 12.2 above.

 

12.4                           Should the present Agreement expire or be terminated, CYCLACEL
agrees not to use or allow any direct or indirect use of the CONTRACT PATENTS
until the expiration of the last of the CONTRACT PATENTS. However, CYCLACEL
shall have the right to dispose of existing inventory for 180 (one hundred and
eighty) days following any such expiration or termination and subject to the
provisions of Article 5 of the present Agreement. Furthermore, CYCLACEL
agrees to return or destroy all proprietary or confidential information,
material, and documents that it has received from the ESTABLISHMENTS and not to
conserve any copies for any purposes whatsoever.

Furthermore, in the event of early termination of the present
Agreement, CYCLACEL hereby agrees to provide the ESTABLISHMENTS with any
results obtained in relation to the invention protected by the CONTRACT PATENTS
and shall allow the ESTABLISHMENTS to directly exploit said results. Indirect
exploitation of said results shall be subject to conclusion of a separate
agreement to this effect between the PARTIES.

 

Article 13 - ENTIRE AGREEMENT

 

13.1                           The present Agreement expresses the entire understanding of the
PARTIES. No general or specific condition appearing in any document sent or
given by the PARTIES can be integrated in the present Agreement.

Should there be a contradiction between the
terms of the present Agreement and the terms of the CONFIDENTIALITY AGREEMENT,
the terms of the present Agreement shall prevail.

 

13.2                           The present Agreement replaces any previous agreements and may only
be modified or renewed by an amendment signed by duly authorized
representatives of the PARTIES.

 

13.3                           It is hereby agreed that the relationship established by the PARTIES
in the present Agreement does not confer any other rights than those set out
hereof. It is expressly agreed that the present Agreement does not confer any
rights to CYCLACEL outside the CONTRACT FIELD, nor rights to any patents other
than the CONTRACT PATENTS.

 

17

 

Article 14 - HEADINGS

 

In the event of difficulties of
interpretation between any of the headings preceding the clauses and any one of
the clauses, the headings shall be ignored.

 

Article 15 - INVALIDITY OF A CLAUSE

 

Should one or more provisions of the
present Agreement be held to be invalid by law or regulation - and in
particular the laws or regulations of the European Union or based on a
definitive decision of a competent court, all the other provisions shall remain
in full effect and the PARTIES shall make the necessary modifications without
delay while respecting, as closely as possible, the spirit of the present
Agreement at the moment of signature.

 

Article 16 - WAIVER

 

The failure of one of the PARTIES to assert
a breach of the present Agreement by the other PARTY shall not be interpreted
as a waiver of said obligation.

 

Article 17 - DISPUTES - GOVERNING LAW

 

17.1                           The laws of France shall govern the present Agreement.

 

17.2                           In the event that a difficulty arises in the validity,
interpretation or execution of the present Agreement, the PARTIES shall try to
settle their differences out of Court.

The PARTIES will each nominate one representative who is not an
executive of the respective PARTY who will jointly attempt to settle any
differences of opinion.

If necessary the present Article shall not prevent the PARTIES
seeking injunctive, emergency or interim relief from the Court.

 

17.3                           In case of persistent disagreement for more than 3 months after one
PARTY has been notified of a difficulty by the other, the competent French
Courts shall have sole jurisdiction.

 

17.4                           The present Article shall remain in effect regardless of the
expiration or termination of the present Agreement.

 

Article 18 - REGISTRATION AT THE REGISTRE NATIONAL DBS BREVETS -FISCAL
REGISTRATION

 

18.1                           The present Agreement may be registered at the Registre National des
Brevets, which is controlled by the Institut National de Propriété
Industrielle, and each National Patent Office for the purpose of registering
the CONTRACT PATENTS; the fees of said registrations to be paid by CYCLACEL.

 

18.2                           Any fiscal registrations of the present Agreement shall be performed
by CYCLACEL at its sole expense.

 

18

 

Article 19 - LANGUAGE

 

The present Agreement has been established
in two versions, one in French and one in English. In case of difficulties of
interpretation, both versions shall be authoritative.

 

Article 20 - NOTIFICATIONS

 

All notifications for the present Agreement shall be
sent by registered letter with acknowledgement of receipt to the PARTY for
which the notice is intended at the following address:

 

For the ESTABLISHMENTS:

CNRS

Délégation
aux Entreprises

3 rue
Michel-Ange

75794
Paris Cedex 16

France

 

19

 

For CYCLACEL:

Cyclacel
Limited

Attention:
Chief Executive

12 St
James’s Square

London

SW1Y4RB

United
Kingdom

 

	
  In Paris

  the

  	
   

  	
  In London

  the

  

 

In four copies including one for the
Institut National de la Propriété Industrielle and one for the contracting
PARTIES.

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Mrs. Catherine BRECHIGNAC

  General Manager of CNRS

  	
   

  	
  Mr. S.G ROMBOTIS

  Chief Executive of CYCLACEL

  

 

 

	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Mr. Jean-Marc BRUEL

  President of the Board of Directors of CURIE

  	
   

  

 

20

 

Annex I

 

PATENT SCHEDULE

 

French patent application N°9514237,
entitled “Nouveaux
dérivés de purine possédant notamment des propriétés anti-prolifératives et
leurs applications biologiques”, filed on December 1st
, 1995 in the name of the CNRS.

 

	
  States

  	
   

  	
  Application

  number

  	
   

  	
  Filing date

  	
   

  	
  Publication

  number

  	
   

  	
  Publication

  Date

  	
   

  	
  Issuance

  number

  	
   

  	
  Issuance

  Date

  	
   

  	
  Expiration

  Date

  
	
  FRANCE

  	
   

  	
  95 14237

  	
   

  	
  01/12/95

  	
   

  	
  2741551

  	
   

  	
  06/06/97

  	
   

  	
  95 14237

  	
   

  	
  30/07/99

  	
   

  	
  01/12/2015

  
	
  WO

  	
   

  	
  FR96/01905

  	
   

  	
  29/11/96

  	
   

  	
  WO97/20842

  	
   

  	
  12/06/97

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  29/07/1999

  
	
  EP

  	
   

  	
  96941088.5

  	
   

  	
  04/11/96

  	
   

  	
  0874847

  	
   

  	
  04/11/98

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  29/11/2016

  
	
  CA

  	
   

  	
  2238843

  	
   

  	
  29/11/96

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  29/11/2016

  
	
  JP

  	
   

  	
  521034/97

  	
   

  	
  29/11/96

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  29/11/2016

  
	
  US

  	
   

  	
  09/077470

  	
   

  	
  29/11/96

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  29/11/2016

  

 

21

 

Annex
II

 

CONDITIONS

 

The claims of
the CONTRACT PATENTS as granted shall contain:

 

1)                                      At least one of the following applications for the pharmaceutical
compounds set out in 2):

 

a)                   use as an antimitotic or antiproliferative drug, in particular for
cancer chemotherapy,

 

or

 

b)                  use for the treatment of psoriasis,

 

or

 

c)                   use for the treatment of parasitosis.

 

2)                                      At least one pharmaceutical compound, characterized by its including
at least one of the purine derivatives mentioned in 2.1 and 2.2:

 

2.1

a)                   Purine derivatives as defined in claims 1 to 9 in the International
PCT patent application published under number WO97/20842,

 

or

 

b)                  At least 14 of any of the 23 purine derivatives mentioned in claim
n° 10 of the International PCT patent application published under number
WO97/20842 and whose chemical formulas are listed below:

2-chloro-6-(3-hydroxybenzylamino)-9methylpurine,

2-(3-hydroxypropylamino)-6-benzylamino-9-isopropylpurine,

2-D,L-(2-hydroxypropylamino)-6-benzylamino-9-isopropylpurine,

2-(5-hydroxypentylamino)-6-benzylamino-9-isopropylpurine,

2-(aminoethylamino)-6-benzylamino-9-iso-propylpurine,

2-bis(2-hydroxyethylamino)-6-benzylamino-9-isopropylpurine,

2-(2-hydroxypropylamino)-6-isopentenylamino-9-isopropylpurine,

2-(2-hydroxyethylamino)-6-cyclohexylmethylamino-9-methylpurine,

2-(2-hydroxyethylamino)-6-benzylamino-9-methylpurine,

2-(2-hydroxyethylamino)-6-benzylamino-9-isopropylpurine,

2-chloro-6-isopentenylamino-9-isopropylpurine,

2-(2-hydroxyethylamino-6-(3-hydroxybenzylamino)-9-methylpurine,

6-benzylamino-2-[(2R) -
2-hydroxymethyl-pyrrolidine-l -yl]- 9 -isopropyle- (9H) purine none
crystalline,

2-[6-benzylamino-9
isopropyle-(9H)-purine-2-yl]-N-benzylaminoethanol,

2-(R,S)-[6-benzylamino-9-isopropyle- (9H)
-purine-2-yl]-aminohexanol,

 

22

 

2-(S)-[6-benzylamino-9-isopropyle- (9H)
-purine-2-yl]-amino-2-phenylethanol,

2-(R)-[6-benzylamino-9-isopropyle-(9
H)-purine-2-yl]-amino-2-phenylethanol,

2-(R)-[6-benzylamino-9-isopropyle-(9H)-purine-2-yl]-amino-3-phenylpropanol,

2- (R, S) -[6
-benzylamino-9-isopropyle-(9H)-purin-2-yl]-amino-pentanol,

2-(R)-[6-benzylamino-9-isopropyle-(9H)-purine-2-yl]-aminopropanol,

2-(S)-[benzylamino-9-isopropyle-(9H)-purine-2-yl]amino-propanol,

2-(R)-(-)-[6-(3-iodo)-benzylamino-9-isopropyle-(9H)-purine-2-yl]-N-pyrrolidine
methanol,

2-(R)-(-)-[6-benzylamino-9-cyclopentyle-(9H)-purine-2-yl]-N-pyrrolidine
methanol.

 

2.2

2-(l-D,L-hydroxymethylpropylamino)-6-benzylamino-9-isopropylpurine,

6-benzylamino-2-R-(1’-ethyl-2’-hydroxyethylamino)-9-isopropylpurine,

6-benzylamino-2-S-(1’-ethyl-2’-hydroxyethylamino)-9-isopropylpurine.

 

For the avoidance of doubt, the conditions
set out in points 1 and 2 of the present Annex are cumulative.

 

In relation to point 1, the three
conditions a), b) and c) are alternatives, and if one of these three alternatives
are fulfilled, point 1 shall be considered fulfilled.

 

In relation to point 2, the conditions 2.1
and 2.2 are cumulative.

Conditions
2.la) and 2.1b) are alternatives. If one of these two alternatives are
fulfilled, 2.1 shall be considered fulfilled.

 

23

 

Annex
III

 

PROXY

 

	
   

  	
  Cyclacel
  Limited

  Attention: Chief Executive

  12 St James’s Square

  SWIY4RB

  United Kingdom

  Paris,
  December 13th, 1999

  

 

Subject:
Appointment of CYCLACEL as authorised representative

 

 

We, the Centre National de la Recherche
Scientifique, a public establishment of scientific and technological nature,
having its headquarters at 3 rue Michel-Ange - 75794 PARIS Cedex 16 - France,
hereby appoint CYCLACEL a company incorporated in England, whose registered
office is at 12 Saint James’s Square- London SW1Y4RB - United Kingdom to act on
our behalf as our duly and legally appointed representative and to do all
things necessary to obtain relief for us in accordance with the convention
between the United Kingdom and France with respect to taxes on income and
capital for the avoidance of double taxation from UK withholding taxes levied
on royalties payable to us by CYCLACEL for the payment of royalties for licence
n° L99094.

 

24

 

Annex
IV

 

Copy of the joint patent agreement n°L98095

 

25[ * ] CERTAIN
CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS
BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED

 

Exhibit 10.2

 

 

SANKYO CO., LTD.

 

- and -

 

CYCLACEL LIMITED

 

 

CS-682 LICENCE AGREEMENT

 

 

TABLE OF CONTENTS

 

	
  1.

  	
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  LICENCES

  	
   

  
	
   

  	
   

  	
   

  
	
  3.

  	
  PAYMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  4.

  	
  DEVELOPMENT AND
  COMMERCIALISATION

  	
   

  
	
   

  	
   

  	
   

  
	
  5.

  	
  INTELLECTUAL
  PROPERTY - OWNERSHIP

  	
   

  
	
   

  	
   

  	
   

  
	
  6.

  	
  INTELLECTUAL PROPERTY -
  PROSECUTION, MAINTENANCE AND ENFORCEMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  7.

  	
  WARRANTIES AND LIABILITY

  	
   

  
	
   

  	
   

  	
   

  
	
  8.

  	
  CONFIDENTIALITY

  	
   

  
	
   

  	
   

  	
   

  
	
  9.

  	
  TERM AND TERMINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  10.

  	
  EFFECTS OF TERMINATION

  	
   

  
	
   

  	
   

  	
   

  
	
  11.

  	
  ASSIGNMENT/SUB-CONTRACTING

  	
   

  
	
   

  	
   

  	
   

  
	
  12.

  	
  FORCE
  MAJEURE

  	
   

  
	
   

  	
   

  	
   

  
	
  13.

  	
  GOVERNING
  LAW

  	
   

  
	
   

  	
   

  	
   

  
	
  14.

  	
  JURISDICTION

  	
   

  
	
   

  	
   

  	
   

  
	
  15.

  	
  WAIVER

  	
   

  
	
   

  	
   

  	
   

  
	
  16.

  	
  SEVERANCE OF TERMS

  	
   

  
	
   

  	
   

  	
   

  
	
  17.

  	
  ENTIRE AGREEMENT/VARIATIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  18.

  	
  NOTICES

  	
   

  
	
   

  	
   

  	
   

  
	
  19.

  	
  COUNTERPARTS

  	
   

  
	
   

  	
   

  	
   

  
	
  20.

  	
  THIS
  AGREEMENT NOT TO CONSTITUTE A PARTNERSHIP

  	
   

  
	
   

  	
   

  	
   

  
	
  21.

  	
  COSTS

  	
   

  
	
   

  	
   

  	
   

  
	
  22.

  	
  PUBLICITY

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 1

  	
  DEVELOPMENT PLAN

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 2

  	
  LICENSED MATERIALS

  	
   

  

 

 

	
   

  	
  SCHEDULE 3

  	
  LICENSED PATENT
  RIGHTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 4

  	
  CNDAC PATENT RIGHTS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 5

  	
  SUCCESSFUL COMPLETION
  CRITERIA

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 6

  	
  RETAINED TECHNICAL
  DATA

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 7

  	
  COMMITTED CLINICAL
  TRIALS

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 8

  	
  ADDRESSES FOR NOTICES

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SCHEDULE 9

  	
  EXPERT’S DECISION

  	
   

  

 

 

THIS AGREEMENT is made on
the Commencement Date

 

BETWEEN:

 

(1)           SANKYO CO., LTD. a
company incorporated in Japan whose principal place of business is at 5-1
Nihonbashi-honcho 3-chome Chuo-ku Tokyo 103-8426 Japan (“Sankyo”); and

 

(2)           CYCLACEL
LIMITED a company incorporated in England whose principal place of business is
at Dundee Technopole, James Lindsay Place, Dundee DD1 5JJ, UK (“Cyclacel”).

 

WHEREAS:

 

(A)          Sankyo owns certain Patent
Rights and Know How (as defined herein) relating to a nucleoside analogue known
as CS-682 and is the non-exclusive licensee of certain Patent Rights relating
to CNDAC.

 

(B)           Cyclacel is a biotechnology
company specialising in the research and development of products in the field
of cancer.

 

(C)           Cyclacel wishes to have an
exclusive licence and non-exclusive
sub-licence (as appropriate) to the Patent Rights and
Know How described in (A) above for the purpose of developing, marketing
and selling a product based on CS-682 within the Territory and Sankyo is willing to grant
Cyclacel such a licence on the terms set out herein.

 

1.             DEFINITIONS

 

1.1           In this Agreement the following definitions shall apply unless the
context requires otherwise:

 

1

 

1.1.1            “Affiliate” - any person,
corporation, company, partnership, joint venture, limited liability company
and/or other entity which Controls, is Controlled by, or is under common
Control with a Party.

 

1.1.2            “Agreement” - this document
including any and all schedules, appendices and other addenda to it as may be
added and/or amended from time to time in accordance with the provisions of
this Agreement.

 

1.1.3            “Blocking IP” - any and all
intellectual property owned or controlled by a Third Party (but not, subject to
Clause 3.6, a Cyclacel Licensee) which would be infringed by the development,
manufacture, import, marketing, distribution, sale or other disposal of
Product.

 

1.1.4            “Business Day” - 9.30 am to
5.30 pm local time on a day other than a Saturday, Sunday, corporate holiday of
a Party, or public holiday in the UK or Japan.

 

1.1.5            “Candidate” - the compound
known as CS-682 and other compounds covered by Licensed Patent Rights.

 

1.1.6            “CNDAC” - the compound
1-(2-C-cyano-2-deoxy-β-D-arabino-pentofuranosyl) cytosine,
or known as CNDAC.

 

1.1.7            “Clinical Trials” - means any
or all of the Phase I Clinical Trials, Phase II Clinical Trials or Phase III
Clinical Trials.

 

1.1.8            “CNDAC  Patent Rights” - any Patent
Rights relating to inventions comprised in the CNDAC Patent Rights listed in
Schedule 4.

 

1.1.9            “Combination Product” - a
product containing Product which also:

 

(a)       contains a therapeutically
active ingredient that is not Licensed IP or CNDAC Patent Rights; or

 

2

 

(b)       is administered through a
therapeutically active administration technology that is not Licensed IP or CNDAC Patent Rights; or

 

(c)       is administered in accordance
with a diagnostic detection technology that is not Licensed IP or CNDAC Patent Rights.

 

each of which shall be an “Other Element”.

 

1.1.10          “Commencement Date” - the date
of execution of this Agreement by the Parties, which is the latest date of
signature below.

 

1.1.11          “Competent Authority” - any
national or local agency, authority, department, inspectorate, minister,
ministry official, parliament or public or statutory person (whether autonomous
or not) of any government of any country having jurisdiction over either any of
the activities contemplated by this Agreement or over the Parties, including
the European Commission, The Court of First Instance and the European Court of
Justice.

 

1.1.12          “Confidential Information” -
in the case of obligations on Cyclacel in relation to Confidential Information,
shall mean Know How and Material forming part of Licensed IP and, in the case
of each of Cyclacel and Sankyo, shall mean the terms and conditions of this
Agreement notwithstanding the provisions of Clause 22 and any other
commercially sensitive information of a Party marked “confidential” supplied or
otherwise made available to them, including but not limited to those Know How
or Material disclosed by Sankyo to Cyclacel under the Confidential Disclosure
Agreement dated February 26, 2002 between the Parties which relates to the
subject matter hereof, or coming into their possession in relation to the
performance of this Agreement.

 

3

 

1.1.13          “Control” - means the
ownership either directly or indirectly of more than 50% of the issued share
capital or any other comparable equity or ownership interest with respect to a
business entity or the legal power to direct or cause the direction of the
general management and policies of the Party in question.

 

1.1.14          “CS-682” - the compound
1-(2-C-cyano-2-deoxy-β-D-arabino-pentofuranosyl)-N(4)-palmitoylcytosine.

 

1.1.15          “Cyclacel Licensee” – an
entity or individual other than an Affiliate of Cyclacel appointed by Cyclacel
as a licensee pursuant to Clause 2.3.

 

1.1.16          “Development Plan” - the plan
for the development of Candidate and resultant Product by or on behalf of
Cyclacel, an outline of which is attached as Schedule 1, which plan may be
updated or amended from time to time pursuant to Clause 4.1.

 

1.1.17          “Disclosing Party” - a Party
which discloses Confidential Information to another Party.

 

1.1.18          “Documents” - reports,
research notes, charts, graphs, comments, computations, analyses, recordings,
photographs, paper, notebooks, books, files, ledgers, records, tapes, discs,
diskettes, CD-ROM, computer information storage means and any other media on
which Know How can be permanently stored.

 

1.1.19          “EMEA” - European Medicines
Evaluation Agency or any successor group thereto.

 

1.1.20          “European Union” the countries
of the European Union from time to time.

 

1.1.21          “Exceptional Cause”

 

4

 

(a)       scientific or other technical
cause outside Cyclacel’s or Cyclacel Licensee’s reasonable control
or arising through the activities of Third Parties including any significant,
unexpected technical problems experienced with the development of Candidate
including but not limited to chemical production of Candidate or polymorphic
form of Candidate or Product or significant, unexpected problems which relate
to the safety, efficacy or toxicology of Candidate, CNDAC or Product;

 

(b)       difficulty outside Cyclacel’s
or Cyclacel Licensee’s reasonable control in recruitment of patients into trial(s); or

 

(c)       any significant, unexpected
change in the regulatory requirements in a country concerning the development
of Candidate or Product which comes into existence after the Commencement Date,
for example a new requirement for studies in specific patient sub-groups.

 

1.1.22          “Excluded Territories” - [*]

 

1.1.23          “Expert’s Decision” – the
mechanism set out in Schedule 9.

 

1.1.24          “FDA” - the U.S. Food and Drug
Administration or any successor agency thereto.

 

1.1.25          “Force Majeure” - in relation
to either Party, any event or circumstance which is beyond the reasonable
control of that Party which event or circumstance that Party could not
reasonably be expected to have taken into account at the date of this Agreement
and which results in or causes the failure of that Party to perform any or all
of its obligations under this Agreement including acts of God, lightning, fire,
storm, flood, earthquake, requirement for quarantine due to infectious disease
outbreak, accumulation

 

5

 

of snow
or ice, lack of water arising from weather or environmental problems, asteroid
or meteor activity, strike, lockout or other industrial or student disturbance,
act of the public enemy, war declared or undeclared, threat of war, terrorist
act, blockade, revolution, riot, insurrection, civil commotion, public
demonstration, sabotage, act of vandalism, prevention from or hindrance in
obtaining in any way materials, energy or other supplies, explosion, fault or
failure of plant or machinery (which could not have been prevented by Good
Industry Practice) provided that lack of funds shall not be interpreted as a
cause beyond the reasonable control of that Party.

 

1.1.26          “Good Industry Practice” - in
relation to any undertaking and any circumstance, the exercise of that degree
of skill diligence, prudence and foresight which would reasonably and
ordinarily be expected from a skilled and experienced person engaged in the
same type of undertaking under the same or similar circumstances.

 

1.1.27          “Insolvency Event” - in
relation to either Party or one of its Affiliates, means any one of the following:

 

(a)       a notice shall have been issued
to convene a meeting for the purpose of passing a resolution to wind up that
Party, or such a resolution shall have been passed.  For the avoidance of doubt a resolution for
the solvent reconstruction or reorganisation of that Party or for the purpose
of inclusion of any part of the share capital of that Party in the Official
List of the London Stock Exchange or in the list of the American Stock Exchange
or quotation of the same on the National Association of Securities Dealers
Automated Quotation System or other such recognised securities market shall not
constitute an Insolvency Event; or

 

6

 

(b)       a resolution shall have been
passed by that Party’s directors to seek a winding up, or an administration
order or a petition for a winding up or administration order shall have been
presented against that Party and appeal proceedings have not been commenced by
that Party within seven
(7) days from the date of such petition or such an
order shall have been made; or

 

(c)       a receiver, administrative
receiver, receiver and manager, interim receiver, custodian, sequestrator or
similar officer is appointed in respect of that Party or over a substantial
part of its assets or any Third Party takes steps to appoint such an officer in
respect of that Party or an encumbrancer takes steps to enforce or enforces its
security; or

 

(d)       a proposal for a voluntary
arrangement shall have been made in relation to that Party under Part I Insolvency
Act 1986; or

 

(e)       a step or event shall have been
taken or arisen outside the United Kingdom which is similar or analogous to any
of the steps or events listed at (a) to (d) above which shall include a Chapter
XI filing in the USA; or

 

(f)        that Party takes any step
outside the ordinary course of business (including starting negotiations) with
a view to readjustment, rescheduling or deferral of any part of that Party’s
indebtedness, or proposes or makes any general assignment, composition or
arrangement with or for the benefit of all or some of that Party’s creditors or
makes or suspends or threatens to suspend making payments to all or some of
that Party’s creditors or the Party submits to any type of voluntary
arrangement; or

 

7

 

(g)       where that Party is resident in
the United Kingdom it is deemed to be unable to pay its debts within the
meaning of Section 123 Insolvency Act 1986.

 

1.1.28          “Know How” - technical and
other information which is not in the public domain, including information
comprising or relating to concepts, discoveries, data, designs, formulae,
ideas, inventions, methods, models, assays, research plans, procedures, designs
for experiments and tests and results of experimentation and testing (including
results of research or development), processes (including manufacturing
processes, specifications and techniques), laboratory records, chemical,
pharmacological, toxicological, clinical, analytical and quality control data,
trial data, case report forms, data analyses, reports, manufacturing data or
summaries and information contained in submissions to and information from
ethical committees and regulatory authorities. Know How includes Documents
containing Know How and shall be deemed to include any rights of action or
intellectual property rights protecting such Know How.  The fact that an item is known to the public
shall not be taken to preclude the possibility that a compilation including the
item, and/or a development relating to the item, is not known to the public.

 

1.1.29          “Legal Requirement” - any
present or future law, regulation, directive, instruction, direction or rule of
any Competent Authority or Regulatory Authority including any amendment,
extension or replacement thereof which is from time to time in force.

 

1.1.30          “Licensed IP” - Licensed
Patent Rights, Licensed Know How and Licensed Materials.

 

8

 

1.1.31          “Licensed  Know How” - any and all Know
How owned by Sankyo relating to the Candidate.

 

1.1.32          “Licensed  Material” - any and all
Material owned by Sankyo directly related to the Candidate as set out in
Schedule 2 as of the Commencement Date unless otherwise specified therein.

 

1.1.33          “Licensed  Patent Rights” - any Patent
Rights owned by Sankyo relating to inventions comprised in the Licensed
Material or Licensed Know How, the Patent Rights listed in Schedule 3 and
any subsequent Patent Rights owned by Sankyo directly relating to the
inventions of CS-682 comprised in the Patent Rights to be added to
Schedule 3 in accordance with Clause 6.8. 
For avoidance of doubt, Licensed Patent Rights exclude the CNDAC Patent
Rights.

 

1.1.34          “Material” - any chemical or
biological substances including any: -

 

(a)       organic or inorganic element or
compound;

 

(b)       nucleotide or nucleotide
sequence including DNA and RNA sequence;

 

(c)       gene;

 

(d)       vector or construct including
plasmids, phages or viruses;

 

(e)       host organism including
bacteria, fungi, algae, protozoa and hybridomas;

 

(f)        eukaryotic or prokaryotic cell
line or expression system or any development strain or product of that cell
line or expression system;

 

9

 

(g)       protein including any peptide
or amino acid sequence, enzyme, antibody or protein conferring target
properties and any fragment of a protein or a peptide enzyme or antibody;

 

(h)       drug or pro-drug;

 

(i)        assay or reagent; or

 

(j)        any other genetic or biologic
material or microorganism.

 

1.1.35          “Marketing Authorisation” -
any and all consents or other authorisations or approvals required from a
Regulatory Authority to market and sell a Product in any country, but not any
form of pricing or reimbursement approval.

 

1.1.36          “Net Sales” - with respect to
Product in relation to which Marketing Authorisation and, if necessary in such
country in the Territory, pricing approval has been granted by the appropriate
Regulatory Authority or other Competent Authority for any jurisdiction for at
least one indication, the gross total amount originally invoiced by Cyclacel,
its Affiliates or Cyclacel Licensees to Third Parties for Products in the
Territory less:

 

(a)       quantity, trade and/or cash
discounts actually granted;

 

(b)       amounts repaid or credited and
allowances including cash, credit or free goods allowances given by reason of
chargebacks, retroactive price reductions (provided that price
adjustments may be retrospectively made for up to two (2) consecutive fiscal years) or billing
errors and rebates (including government-mandated rebates), actually allowed or
paid;

 

10

 

(c)       amounts refunded or credited
for Product which was rejected, spoiled, damaged, outdated or returned;

 

(d)       freight, shipment and insurance
costs incurred transporting Product to a Third Party purchaser;

 

(e)       taxes, tariffs, customs duties
and surcharges and other governmental charges incurred in connection with the
sale, exportation or importation of Product.

 

(f)        bad debt losses and costs for
the recovery of such bad debts.

 

The transfer of Product by Cyclacel or one of its Affiliates to another
Affiliate or Cyclacel Licensee shall not be considered a sale.  In such cases Net Sales shall be determined
based on the invoiced sale price by the Affiliate or Cyclacel Licensee to the
first Third Party trade purchaser, less the deductions allowed under this
Clause.

 

Upon the sale or other disposal of Product other than in a bona fide
arms length transaction exclusively for money or upon any use of Product for
the purposes which do not result in a disposal of that Product in consideration
of sales revenue customary in the country of sale, such other sale, disposal or
use shall be deemed to constitute a sale at the relevant open market price in
that country in which the sale, other disposal or use occurs, or, if that price
is not ascertainable, a reasonable price assessed on an arm’s length basis for
the goods or services provided in exchange for the supply.  Disposal of Product for, or use of Product
in Clinical Trials for the purpose of obtaining a Marketing Authorisation or
pre-clinical trials or as free samples in quantities common in the industry for
this sort of Product shall not give rise to any deemed sale under this Clause.

 

11

 

Such amounts shall be determined from the books and records of Cyclacel
maintained in accordance with GAAP (generally accepted accounting principles), consistently applied.

 

For the avoidance of doubt it is declared and agreed that if the
product can be marketed and sold without pricing approval nothing in this
definition requires pricing approval for it to be classified as Product for the
purposes of this Agreement.

 

1.1.37          “Party or Parties” - Cyclacel
or Sankyo or Cyclacel and Sankyo, as the case may be.

 

1.1.38          “Patent Rights” - patent
applications and patents, author certificates, inventor certificates or certifications
of invention, applications for certificates of invention, utility certificates,
improvement patents and models and certificates of addition and all foreign
counterparts of them, including any divisions or divisional applications and
patents, refilings, renewals, continuations, continuations-in-part, patents of
addition, extensions (including patent term extensions), reissues,
substitutions, confirmations, registrations, revalidations, request for
continued examination, re-examinations or renewals thereof, pipeline and
administrative protections and additions, and any equivalents of the foregoing
in any and all countries of or to any of them including foreign counterpart
applications, as well as any supplementary protection certificates and
equivalent protection rights in respect of any of them.

 

1.1.39          “Phase I Clinical Trial” - a
human clinical trial normally conducted in healthy volunteers or patients with
the aim of establishing the pharmacokinetic, pharmacodynamic and early safety
profile of a product (alone or in combination with another agent).

 

12

 

1.1.40          “Phase II Clinical Trial” - a
human clinical trial where a product is tested in a number of patients for the
purpose of establishing preliminary data on the efficacy and safety of a
product.

 

1.1.41          “Phase III Clinical Trial” - a
human clinical trial conducted in a sufficient number of patients to establish
safety or efficacy for one or more indication(s) tested and required for the
filing of a submission to obtain Marketing Authorisation.

 

1.1.42          “Product” - a pharmaceutical
product comprising the Candidate or otherwise falling within a Valid Claim of
the Licensed Patent Rights.

 

1.1.43          “Professors” - [*]

 

1.1.44          “Quarter” - each period of
three months ending on 31 March, 30 June, 30 September or 31
December and “Quarterly” shall be construed accordingly.

 

1.1.45          “Recipient Party” - the Party
which receives Confidential Information from the other Party.

 

1.1.46          “Regulatory Authority” - shall
mean any national, supranational, regional, state or local regulatory agency,
department, bureau, commission, council or other governmental entity including
the FDA and EMEA, in each country involved in the granting of Marketing
Authorisation for a Product.

 

1.1.47          “Results” - Know How, Patent
Rights and Materials arising from any research, development or
commercialisation activity undertaken by or on behalf of Cyclacel in connection
with this Agreement.

 

13

 

1.1.48          “Successful Completion” -
shall mean that the Phase II Clinical Trial in question has met the end points
set out in Schedule 5.

 

1.1.49          “Territory” - the World
excluding the Excluded Territories.

 

1.1.50          “Third Party” - any entity or
individual other than Cyclacel or Sankyo or their respective Affiliates.

 

1.1.51          “Valid Claim” - a claim of an
issued and unexpired patent included within Patent Rights, which has not been
permanently revoked, held unenforceable or invalid by a decision of a court or
other governmental agency of competent jurisdiction, un-appealable or
un-appealed within the time allowed for appeal, and which has not been admitted
to be invalid or unenforceable through reissue or disclaimer or otherwise.

 

1.1.52          “Year” - twelve (12) months
commencing on 1 January and ending on 31 December.

 

1.2           In this Agreement:

 

1.2.1            Unless the context
otherwise requires all references to a particular Clause, Schedule or
paragraph shall be a reference to that Clause, Schedule or paragraph, in
or to this Agreement as it may be amended from time to time pursuant to this
Agreement;

 

1.2.2            The table of contents and
headings are inserted for convenience only and shall be ignored in construing
this Agreement;

 

1.2.3            Unless the contrary
intention appears words importing the masculine gender shall include the
feminine and vice versa and words in the singular include the plural and vice
versa;

 

14

 

1.2.4            Unless the contrary
intention appears words denoting persons shall include any individual,
partnership, company, corporation, joint venture, trust, association
(incorporated or not incorporated), organisation or other entity, in each case
whether or not having legal personality;

 

1.2.5            Reference to any statute,
directive or regulation includes any modification or re-enactment of that
statute or regulation; and

 

1.2.6            References to the word
“include” or “including” are to be construed without limitation to the
generality of the preceding words.

 

2.             LICENCES

 

2.1           Sankyo hereby grants to Cyclacel

 

2.1.1            an exclusive licence under
the Licensed IP.

 

2.1.2            a non-exclusive,
royalty-free terminable sub-licence under the CNDAC Patent Rights which are
licensed with a right to sub-license by the Professors to Sankyo.

 

in each case
to research, develop, make, have made, use, import, have imported, market, have
marketed, sell, offer for sale, have sold or otherwise dispose of
Candidate (or any constituent part of the same) and Product, for all
indications in the Territory.

 

2.2           The
Parties [*] which requires [*] with Product in the [*] and thus [*].  Sankyo shall use its reasonable efforts [*]

 

15

 

[*].

 

2.2.1            [*] relation to the
Candidate, Sankyo shall so notify Cyclacel in writing [*] shall be [*] under
the same commercial terms as set out in this Agreement.

 

2.2.2            [*] in relation to the
Candidate, Sankyo shall so notify [*] discuss in good faith issues relating to
[*] including but not limited to terms for the usage of data generated by
Cyclacel [*]

 

2.2.3            Sankyo shall not grant any
rights or licences in the Licensed IP or CNDAC Patent Rights to any Third Party
[*] or itself carry out any activities utilising the Licensed IP or
Sub-Licensed IP [*] which would or would be reasonably expected to have an
adverse impact upon the value or scope of the rights granted to Cyclacel
hereunder. [*]

 

2.3           The licences set out in Clause 2.1 shall include the right to grant
sub-licences.  Save as otherwise provided
in this Agreement, Cyclacel shall procure that Cyclacel Licensees are bound by the same
obligations, to the extent practicable, as those hereunder, including, but not limited to the obligations
of confidentiality and non-use

 

16

 

for
unauthorised purpose.  Cyclacel shall be
responsible to Sankyo for the acts and omissions, including breach of this Agreement, of any Cyclacel Licensee provided that in the case of a Cyclacel
Licensee committing a material breach that would constitute a material breach
of this Agreement, Cyclacel shall have sixty (60) days to require such Cyclacel
Licensee to remedy the breach or to terminate its sub-licence before Cyclacel shall
be considered to have committed a material breach under Clause 9.3.1.  Cyclacel shall give Sankyo prompt
notification of the identity of each Cyclacel Licensee with whom it concludes a
sub-licence.

 

2.4           As soon as reasonably practicable following the Commencement Date
and subject to the provisions of Clause 3.2.2 Sankyo shall disclose, supply copies of, or otherwise make available to Cyclacel the Licensed Materials and Documents
containing the Licensed Know How.  In
particular, and without limiting the foregoing, Sankyo shall supply Cyclacel
with quantities of the Candidate and CNDAC as listed in Schedule 2 and all synthesis data and methods relating to the Candidate. 
Cyclacel acknowledges that (i) save as set out in Clause 7.2 Sankyo does
not warrant the quality of any of the Licensed Materials, and (ii) Sankyo has
no further obligation to supply the Candidate and CNDAC in addition to the
quantities listed in Schedule 2.  Unless Cyclacel requests transfer of any or all of
those capsules in writing after the Commencement Date, the Parties shall execute a
separate entrustment agreement with respect to the maintenance and analysis of
capsules on stability in Schedule 2, which sets forth that (i) Cyclacel
shall pay the expenses for entrustment to Sankyo and such expenses shall not be
subject to Clause 3.3.2, and that (ii) Sankyo shall perform the analysis after
the expiration dates for storage periods of such capsules on stability.  Cyclacel acknowledges that Sankyo would
never be able to further extend expiration dates of such capsules according to
Sankyo’s standards. 
Sankyo will transfer ownership of all formulated Candidate as listed in Schedule 2 and the
current drug master file of the Candidate to Cyclacel except for certain amount retained
by Sankyo necessary for the technology transfer or other purposes, including,
but not limited to, to comply with

 

17

 

regulatory requirements.  Ownership, title and risk of all Licensed
Materials provided under this Clause 2.4 shall be transferred from Sankyo to
Cyclacel (i) at shipment if shipped by Sankyo or its designee to Cyclacel, (ii)
upon transfer of [*] in accordance with Clause 7.4 or (iii) if Licensed
Materials otherwise become available to Cyclacel.  Sankyo shall provide Cyclacel with all
reasonable assistance requested by Cyclacel in interpreting and understanding
the Licensed IP and in
the transfer, including updating to the FDA, of [*] in accordance with Clause
7.4 at Cyclacel’s cost.  Such
assistance by Sankyo for the CMC technology transfer of synthesis and internal
process checks shall be deemed to be completed if
either of the following events occurs:

 

[*]

 

Sankyo shall
maintain its copies of Documents containing the Licensed Know-How for the
lesser of eight
(8) years or until requested by Cyclacel under Clause
2.7 or otherwise agreed
by the Parties. 
Should Sankyo intend to dispose of the Documents it shall so notify
Cyclacel and Cyclacel will be entitled to take ownership of such Documents at Cyclacel’s discretion
and cost.

 

2.5           Sankyo shall at Cyclacel’s request execute or procure the execution
of all such deeds and documents as may be necessary or desirable to record any
of the rights granted to Cyclacel under this Agreement with any patent registry.

 

2.6           Sankyo shall notify Cyclacel in the event that Sankyo generates any
Patent Rights or Know How relating to the Candidate or relating to CNDAC which
also relates to the Candidate and if Cyclacel so requests such Patent Rights or
Know How shall then

 

18

 

automatically
become part of the Licensed IP and shall be licensed to Cyclacel on the same
terms as set out herein.

 

2.7           Sankyo shall maintain those items of technical data listed in
Schedule 6 and shall make the same available to Cyclacel for use in connection
with the development or commercialisation of Product (including, without
limitation, for the purposes of cross-referencing or inclusion in regulatory
filings relating to Candidate or Product). 
Sankyo shall exert
its reasonable efforts to make such data available to Cyclacel within
thirty (30) Business Days of the Commencement Date or the date which such data become available
to Sankyo.

 

2.8           Sankyo shall promptly inform Cyclacel of any significant developments
of which it becomes aware concerning any part of the Licensed IP or CNDAC
Patent Rights which are licensed by Sankyo to Cyclacel.

 

3.             PAYMENTS

 

3.1           In consideration of the rights granted to Cyclacel under this
Agreement Cyclacel shall pay to Sankyo payments set out in this Clause 3.

 

3.2           Cyclacel shall pay to Sankyo a licence fee and costs comprised of
the following:

 

3.2.1            [*] payable within thirty
(30) days of the Commencement Date;

 

3.2.2            Sankyo’s reasonable costs
incurred pursuant to Sankyo’s technology transfer obligations under Clause 2.4
within 30 days of receipt of Sankyo’s Quarterly invoice and those costs
incurred to Sankyo and reimbursed by Cyclacel under Clause 6.1 provided that in
the event such amounts exceed [*] any amounts in excess of [*] shall be
creditable against the milestone payments set out in Clause 3.3.1 and provided
further that such

 

19

 

costs
in excess of [*] shall be subject to an overall maximum of [*].  The Parties acknowledge that as of the end
of June 2003 Sankyo has incurred [*] in transferring Licensed Know How and
Licensed Materials to Cyclacel and that Sankyo has invoiced Cyclacel for such
amount.  Notwithstanding the generality
of the foregoing, Cyclacel agrees to pay to Sankyo such [*] within thirty (30)
days of the Commencement Date.

 

3.3           Cyclacel shall pay to Sankyo the following non-refundable payments, provided, the milestone payments set out in Clauses 3.3.1 to 3.3.5 shall be
payable in relation to the first Product only.

 

3.3.1            subject to any set-off, if
applied pursuant to Clause 3.2, [*] within thirty (30) days of the Successful
Completion of the first Phase II Clinical Trial for Product;

 

3.3.2            [*] within thirty (30)
days of the commencement of the first Phase III Clinical Trial for Product,
provided, however: (a) if Cyclacel commenced the first Phase III Clinical Trial
for Product without the Successful Completion of the first Phase II Clinical
Trial for Product, the payment under Clause 3.3.1 above shall become also
payable to Sankyo in addition to the payment under this Clause 3.3.2 and; (b)
in the event that Cyclacel is granted Marketing Authorisation for Product in
the USA, any country of the European Union or Japan on the basis of any
clinical trial results generated other than pursuant to a formal Phase III
Clinical Trial, the milestone payment under this Clause 3.3.2 shall become due
and payable by Cyclacel at the same time.

 

20

 

3.3.3            [*] within thirty (30)
days of the granting of the first Marketing Authorisation and, if required in
order to sell Product, pricing approval for Product in the USA;

 

3.3.4            [*] within thirty (30)
days of the granting of the first Marketing Authorisation and, if required in
order to sell Product, pricing approval for Product in any country of the
European Union;

 

3.3.5            [*] within thirty (30)
days of the granting of the first Marketing Authorisation and, if required in
order to sell Product, pricing approval for Product in Japan;

 

3.3.6            royalties applicable on
Net Sales as follows:

 

3.3.6.1                 [*] on annual Net Sales less than [*]

 

3.3.6.2                 [*] on annual Net Sales greater than or equal to
[*] and less than [*]

 

3.3.6.3                 [*] on annual Net Sales greater than or equal to
[*]

 

3.4           In the case of sales of Product by
Cyclacel, its Affiliates or Cyclacel Licensees in countries where such sale does
not fall within a Valid Claim of a Licensed Patent Right the royalty payable on
Net Sales in such country shall be [*]  regardless of the volume of Net Sales in such country.

 

3.5           In the event a Third Party launches
a generic product which directly competes with the Product and does not infringe
Licensed IP and the volume of sales of Product are less than or equal to [*] of
the total volume of sales of Product plus

 

21

 

all such competing generic products in such country as
evidenced by data compiled by IMS Health of 1499 Post Road, Fairfield, CT
06430, USA or, in the event such data by IMS Health is not available or the
Parties agree it is not appropriate to use such data in such country, a similar
market research agency the royalty payments set out in Clauses 3.3.6.1 to 3.3.6.3
shall no longer be payable to Sankyo on Net Sales in such country.

 

[*]

 

3.7           The royalties payable by Cyclacel hereunder shall be payable for the
following periods:

 

22

 

3.7.1            In those countries where
at the time of first commercial sale in such county the sale of Product falls
within a Valid Claim of Licensed Patent Rights subsisting in that country,
royalties shall be payable until the latter of (i) the last to expire of such
Licensed Patent Rights in that country or (ii) the tenth (10th)
anniversary of the date of first commercial sale in that country;

 

3.7.2            In those countries where
at the time of first commercial sale of Product in that country the sale of
Product does not fall within a Valid Claim of Licensed Patent Rights subsisting
in that country, royalties shall be payable until the tenth (10th)
anniversary of the date of first commercial sale in that country.

 

3.8           Disposal of reasonable quantities of Product for, or use of Product,
in Clinical Trials performed for the purpose of obtaining a Marketing
Authorisation or pre-clinical trials, or as free samples to be in quantities
common in the industry for this sort of Product shall not give rise to
liability for payment of a royalty under this Clause 3.

 

3.9           In the event that Product is sold as a Combination Product containing a therapeutically
active ingredient that is not Licensed IP or CNDAC Patent Rights in
a country, the Net Sales of the Product shall be determined by multiplying [*]  In the event Cyclacel wishes to develop a Combination Product
which (1) is administered through a therapeutically active administration
technology that is not Licensed IP or CNDAC Patent Rights, (2) is administered
in accordance with a diagnostic detection technology that is not Licensed IP or
CNDAC Patent Rights or (3) otherwise depends for a significant
part of its value upon components which are not Licensed IP or CNDAC Patent Rights, then the Parties shall separately discuss

 

23

 

how to
determine the Net Sales applicable for such Combination Product. 
In the event the Parties fail to agree an
applicable Net Sales price for such combination product within sixty (60) days
of commencing such good faith discussions, such price shall be determined by a
reputable independent auditor appointed by agreement between the Parties or,
failing which, the President (or his or her nominee) for the time being of the
Institute of Chartered Accountants of England and Wales (or any successor body
thereto).

 

3.10         Cyclacel shall, and shall procure that its Affiliates and
Cyclacel Licensees shall, keep true and accurate records and books of account containing all
data necessary for the calculation of the amounts payable by it to Sankyo
pursuant to this Agreement.  Those
records and books of account shall be kept for seven (7) years
following the end of Year to which they relate and shall, upon reasonable notice having been
given by Sankyo or its nominee, be open on Business Days for examination, under
the terms of confidentiality contained in this Agreement, by an independent
firm of accountants appointed by agreement between the Parties or between
Cyclacel and Sankyo’s nominee (as appropriate) or, failing such agreement
within twenty-eight (28) days, by the President (or his or her nominee) for the
time being of the Institute of Chartered Accountants of England and Wales (or
any successor body thereto).  Such
examination shall take place not later than five (5) years
following the expiration of the period to which it relates and there shall be
no more than one such examination per year. 
Such independent accountant shall provide a written report of his
findings to each of Cyclacel and Sankyo in which he certifies the moneys due to
Sankyo in respect of the period under review. 
If such examination demonstrates that Cyclacel has underpaid royalties due to Sankyo, Cyclacel shall make a
balancing payment within thirty (30) days. 
The cost of the examination, review and
certification shall be the responsibility of Cyclacel if Cyclacel is shown to
have underestimated the monies payable to Sankyo in any period being reviewed
by more than [*] and the responsibility of Sankyo otherwise.

 

24

 

3.11         Cyclacel shall make the royalty payments due to Sankyo under this
Clause 3 at Quarterly intervals.  Within thirty (30) days of
the end of each Quarter after first commercial sale in any country, Cyclacel
shall prepare a statement which shall show on a Product by Product and a
country by country basis for the previous Quarter all monies due to Sankyo
under Clause 3 and shall, if applicable, contain Cyclacel’s reasonable estimate
of any amounts deductible pursuant to Clauses 3.4 and 3.5.  That statement shall include details of
the particular Product description including to the extent it requires use of
Combination Product, sales of the Product and the royalty amount payable for each country in the Territory.  Cyclacel shall pay the royalty due under Clause 3.3.6 within thirty (30) days of issuance of such statement.  Within thirty (30) days of the end of the
final Quarter of each Year Cyclacel shall carry out a reconciliation in
relation to the royalty payments made and the royalty rate applied during the
previous Year and, if applicable, shall apply the formula set out in Clause
3.6.  If such reconciliation
demonstrates that Cyclacel has underpaid royalties due to Sankyo it shall make
a balancing payment within thirty (30) days and if it is demonstrated that
Cyclacel has overpaid royalties due to Sankyo, Sankyo shall make a payment to
Cyclacel of a balancing refund within thirty (30) days.

 

3.12         If Sankyo give notice to Cyclacel within ten (10) Business Days of the
receipt of any statement provided pursuant to Clause 3.11 that it does not
accept it, that statement shall be reviewed and certified by an independent
accountant appointed by agreement between the Parties or, in default of
agreement within twenty
eight (28) days, by the President (or his or her nominee)
for the time being of the Institute of Chartered Accountants of England and
Wales (or any successor body thereto). 
Cyclacel shall make available all books and records required for the
purpose of that review and certification and the statements so certified shall
be final and binding between the Parties. 
The cost of the examination, review and certification shall be the
responsibility of Cyclacel if Cyclacel is shown to have underestimated the
monies payable to Sankyo in any period being reviewed by more than [*] and

 

25

 

the
responsibility of Sankyo otherwise. 
Following any such certification under Clause 3.10 or this Clause 3.12
the Parties shall forthwith make any adjustments necessary in respect of the
monies already paid to Sankyo in relation to the period in question.

 

3.13         Where Product is sold in a currency other than US dollars the rate
of exchange to be used for converting such other currency into US dollars shall
be the Telegraphic Transfer Middle (T.T.M.) rate at which such other currency can be
sold for US dollars at the Bank of England in London at the close of business
on the last working date for the period for which payment is to be made.

 

3.14         If any sums are unpaid by Cyclacel on the dates specified in this
Clause then Sankyo shall be entitled to charge Cyclacel interest on the amount
unpaid at the rate of [*] per annum above the prevailing Bank of England base
lending rate from time to time until payment in full is made.

 

3.15         Royalties or
other payments payable under this Clause shall be
payable hereunder without any deduction or set-off save that if any law,
regulation or treaty requires a withholding of income taxes on any milestone, royalty
payments or other
payments due to Sankyo, such taxes will be deducted for
such payment and paid to the appropriate taxing authorities.  Certificates of such tax payments shall be
delivered to Sankyo along with the balance of the milestone, royalty
payment or other
payments.

 

3.16         All payments made to Sankyo under the Agreement shall be made by
telegraphic transfer to the account of Sankyo Co. Ltd. at:

 

[*]

 

26

 

or any other bank account that may be notified by Sankyo to Cyclacel
from time to time.

 

4.             DEVELOPMENT AND COMMERCIALISATION

 

4.1           Cyclacel shall use commercially reasonable endeavours to pursue the
development and commercialisation of Product. 
For the purposes of this Clause 4 such reasonable endeavours shall mean
those efforts to develop and commercialise Product which are at least the same
as the efforts used by Cyclacel in relation to the development and
commercialisation of other Cyclacel pharmaceutical products under similar
commercial circumstances that have similar commercial value and development
status to the Product.  Cyclacel shall carry
out such development in accordance with the key elements of the Development
Plan which plan may be updated and/or amended from time to time by Cyclacel and
Cyclacel shall provide Sankyo with a copy of any such updated or amended plan.

 

4.2           Without
limiting the generality of the foregoing Cyclacel shall use its reasonable
endeavours [*]  If Cyclacel, its
Affiliates or Cyclacel Licensees have not [*] then provided such failure is not
due to an Exceptional Cause Sankyo shall be entitled to notify Cyclacel that it
intends to terminate this Agreement, Cyclacel shall have sixty (60) days to
reply to Sankyo’s notification and demonstrate that such failure was due to an
Exceptional Cause.  In the event that
the Parties agree that no such Exceptional Cause has been demonstrated then
Sankyo will have the right to terminate this Agreement upon thirty (30) days
written notice.  [*] The Parties shall,
no later the fifth (5th) anniversary of the Commencement Date
discuss, in good faith and review such time periods and, if

 

27

 

appropriate,
extend such period to [*]

 

4.3           Cyclacel shall within thirty (30) days of each anniversary of the
Commencement Date provide Sankyo with a written summary of the progress which
Cyclacel, its Affiliates and/or Cyclacel Licensees has made against the
Development Plan in the previous twelve (12) month period. 
In addition, Cyclacel shall provide Sankyo within seven (7) months of
each annual written report with a brief update of such progress, which update
may be given in writing by facsimile or by e-mail.

 

4.4           In the event that Cyclacel decides to appoint a Third Party, or if
Cyclacel receives an offer from a Third Party, in either case to develop and/or
commercialise Product solely in Japan or in Japan as part of a multi-territory sub-licence,
it shall so notify Sankyo which notification shall not be made prior to the
first Successful
Completion of a [*] Clinical Trial or the decision by Cyclacel or a Cyclacel Licensee to initiate [*] Clinical Trials  and shall be accompanied by (i) details
of the terms upon which Cyclacel is prepared to offer for the appointment of a
Third Party licensee
and (ii) the data and evidence on which Cyclacel or Cyclacel
Licensee made such
decision. 
Sankyo shall notify Cyclacel within [*] of receipt of the
Cyclacel notification whether Sankyo wishes to develop and/or commercialise
Product in Japan.  If Sankyo notifies
Cyclacel that it does wish to develop and/or commercialise Product in Japan the
Parties shall meet and negotiate in good faith the terms of appointment of
Sankyo as Cyclacel Licensee in Japan. 
If Sankyo notifies Cyclacel that it does not wish to develop and/or
commercialise Product in Japan or, in the case where Sankyo has notified
Cyclacel that it does wish to develop and/or commercialise Product in Japan but
the Parties have failed to agree terms within [*] of commencing negotiations,
then Cyclacel shall be free to appoint a Third Party to develop and/or
commercialise Product in Japan provided that such appointment shall be on terms
no more favourable than those terms which Cyclacel

 

28

 

was
prepared to offer Sankyo.  For the
avoidance of doubt if Cyclacel receives an offer at any time by a Third Party
to commercialise Product on a worldwide basis, Cyclacel shall notify such Third Party that
Sankyo has a first refusal right of Marketing in Japan and Cyclacel shall
propose to such Third Party to accept such condition.  In such case, the conditions imposed
under this Clause will be accelerated and Cyclacel will serve notification to
Sankyo who will respond in accordance with the provisions herein. [*]

 

5.             INTELLECTUAL PROPERTY - OWNERSHIP

 

5.1           Sankyo owns the Licensed IP and during the period of this Agreement
shall not assign, transfer, mortgage, charge or otherwise dispose of or
encumber the same without the prior written consent of Cyclacel.

 

5.2           Any and all Results shall vest in and be owned by Cyclacel.

 

6.             INTELLECTUAL PROPERTY - PROSECUTION, MAINTENANCE AND ENFORCEMENT

 

6.1           Sankyo shall at its own cost and expense file, prosecute and
maintain Licensed Patent Rights, including for the avoidance of doubt all
annuity and renewal fees and shall be responsible for the conduct of any claims
or proceedings relating to the Licensed Patent Rights, including any interference or
opposition proceedings.  Sankyo shall
keep Cyclacel and/or Cyclacel’s nominated patent attorney fully and promptly

 

29

 

informed
of such filing, prosecution and maintenance of the Licensed Patent Rights including, without limitation,
providing Cyclacel and/or Cyclacel’s nominated patent attorney with copies of
all correspondence with any patent office and shall give Cyclacel the right to comment thereon prior to any response being made to any such patent
office.  Sankyo shall ensure that copies
of all such patent office correspondence provided to Cyclacel for comment shall
be provided no less that sixty (60) days prior to the expiry of any patent
office deadline for response (if applicable) and Cyclacel shall ensure that it
provides Sankyo with its comments on such correspondence not less than thirty
(30) days prior to the expiry of any such patent office deadline for
response.  Without limiting the
generality of the foregoing obligation to keep Cyclacel fully and promptly
informed, Cyclacel may itself or through its patent attorney make a written
request to Sankyo or
Sankyo’s nominated patent attorney not more than once
per Quarter for a progress report on the filing, prosecution and maintenance of
the Licensed Patent Rights during the previous Quarter and a summary of the
anticipated activities for the next Quarter. 
Notwithstanding this Clause 6.1, Cyclacel shall pay the costs and
expenses of such filing, prosecution and maintenance upon Sankyo’s Quarterly invoice
prior to its payment of the first applicable milestone
under Clauses 3.3.3, 3.3.4 or 3.3.5 and thereafter such costs shall be borne by
Sankyo, except that such costs borne by Cyclacel after its payment of the Phase
III entry milestone
under 3.3.2, will be creditable against the first
applicable milestone under Clauses 3.3.3, 3.3.4 or 3.3.5.

 

6.2           If Sankyo fails to prosecute or maintain the
Licensed Patent Rights or any part thereof it must notify Cyclacel in writing
at least thirty (30) days prior to the expiry of any material deadline for the
taking of any steps in such action, proceeding or prosecution and thereafter
Cyclacel may in its sole discretion prosecute or maintain the
Licensed Patent Rights or any part thereof. 
If Cyclacel decides to prosecute or maintain the
Licensed Patent Rights or any part thereof it shall do so at its own cost
and expense

 

30

 

and
Sankyo shall promptly arrange for its patent attorneys to transfer to Cyclacel
all relevant papers, files and other documents.

 

6.3           If either Party learns of any infringement or threatened
infringement by a Third Party of Licensed IP then such Party shall promptly
notify the other Party and shall provide such other Party with available
evidence of such infringement.

 

6.4           In the event of an infringement of the Licensed IP Cyclacel shall
have the first right to bring any action or proceedings in accordance with the
following:

 

6.4.1            Sankyo shall have the
right to join as a co-plaintiff and be separately represented by counsel of its
own choice and at its own reasonable cost and expense;

 

6.4.2            Sankyo shall otherwise at
Cyclacel’s reasonable request and sole expense, provide Cyclacel with
reasonable assistance in relation to such action or proceedings;

 

6.4.3            if Cyclacel succeeds in
any proceedings whether at trial or by way of settlement, Cyclacel shall be
entitled to retain such award of costs and damages made in such proceedings or
settlement sum after having reimbursed Sankyo for its costs and expenses
incurred in assisting with the proceedings, subject to Clause 6.4.1 where
Cyclacel and Sankyo shall be equally entitled to retain such award.  If Cyclacel should lose such proceedings
then Cyclacel shall on demand reimburse Sankyo its costs and expenses incurred
in assisting with the proceedings;

 

6.4.4            if Cyclacel fails to take
any such proceedings Sankyo may give Cyclacel notice requiring Cyclacel to take
such proceedings jointly with Sankyo within thirty (30) days of the date of the
notice and if Cyclacel fails to do so Sankyo shall be entitled to do so at its
own cost and expense and Cyclacel

 

31

 

shall
provide all necessary assistance to Sankyo in relation to such proceedings
including lending its name to such proceedings as a co-plaintiff.  If Cyclacel does not join with Sankyo in
taking part in such proceedings Cyclacel shall not be entitled to be separately
represented in such circumstances and Sankyo shall have sole conduct of such
proceedings including the right to settle them.  If Sankyo succeeds in any such proceedings it shall be entitled
to retain the whole of any award of costs and damages made or settlement sum
paid.  If Cyclacel joins with Sankyo in
taking part in such joint proceedings Cyclacel shall be entitled to be
separately represented in such circumstances and Sankyo shall jointly conduct
such proceedings with Cyclacel including the right to settle them.  If Sankyo and Cyclacel succeed in any such
proceedings they shall share equally any award of costs and damages made or
settlement sum paid.

 

6.5           If during the term of this Agreement either Party receives any
notice, claim or proceedings from any Third Party alleging infringement of that
Third Party’s intellectual property or know how as a result of either Party’s
activities in relation to this Agreement or use and exploitation of the
Licensed IP the Party receiving that notice shall:

 

6.5.1            forthwith notify the other
Party of such notice, claim or proceedings;

 

6.5.2            make no admission of
liability without the prior consent of the other Party;

 

6.5.3            subject to Clause 6.6.1
below Cyclacel shall conduct the defence of such claims or proceedings,
including the right to settle them which shall include taking a licence from
such Third Party, and Sankyo shall at Cyclacel’s cost and expense co-operate
with Cyclacel and its legal counsel and be available at Cyclacel’s reasonable
request to assist in such proceedings. 
Cyclacel

 

32

 

shall
keep Sankyo and its legal counsel fully and promptly informed at all times as
to the status of Cyclacel’s defence.

 

6.6           Whilst Cyclacel conducts the defence of such claim or proceedings:

 

6.6.1            Cyclacel shall be
responsible for and shall have conduct of such claims or proceedings but shall
fully consult with Sankyo in defending or settling such claim or proceedings
and Cyclacel shall not consent to any settlement, order or judgment requiring
Sankyo to pay costs, damages or provide other relief without the written consent
of Sankyo;

 

6.6.2            if any such proceedings
are settled by way of licence, then to the extent any royalties payable to a
Third Party under such licence relate to Blocking IP they shall be deducted
from the royalties payable by Cyclacel to Sankyo to the same extent and in the
same manner as set out in Clause 3.6.

 

6.7           At
Cyclacel’s request and expense Sankyo shall promptly take all necessary steps
to facilitate any application for a supplementary protection certificate
extension of term or its equivalent, for any of the Licensed Patent Rights.

 

6.8           Within sixty (60) days after each Year-end,
Sankyo shall provide Cyclacel with a report describing the status of the Licensed
Patent Rights and Cyclacel shall provide Sankyo with a report describing the
status of the any Patent Rights owned by Cyclacel under Clause 5.2.  Such reports shall include, at a minimum,
the patent country, patent and application numbers, filing date, issue date,
expiration date and any other relevant information, and shall be used to update
Schedule 3.

 

	
  Sankyo’s report shall be sent to:

  	
   

  	
  Cyclacel Limited

  
	
   

  	
   

  	
  Dundee
  Technopole

  
	
   

  	
   

  	
  James
  Lindsay Place

  
	
   

  	
   

  	
  Dundee
  DD1 5JJ

  
	
   

  	
   

  	
  UK

  
	
   

  	
   

  	
  Attention:
  Chief Executive Officer

  

 

33

 

	
   

  	
   

  	
  Telephone:
  +44 1382 206062

  
	
   

  	
   

  	
  Facsimile:
  +44 1382 206067

  
	
   

  	
   

  	
   

  
	
  Cyclacel’s report shall be sent to:

  	
   

  	
  Sankyo Company, Limited

  
	
   

  	
   

  	
  [*]

  

 

7.             WARRANTIES AND LIABILITY

 

7.1           Each Party represents and warrants to the other Party that:

 

7.1.1            it has the corporate power
and authority and the legal right to enter into this Agreement and that this
Agreement is a legal and valid obligation binding upon such Party and
enforceable in accordance with its terms. 
The execution, delivery and performance of the Agreement by such Party
does not conflict with any agreement, instrument or understanding, oral or
written, to which it is or by which it is bound, nor violate any law or
regulation of any court, governmental body or administrative or other agency
having jurisdiction over it;

 

7.1.2            it has not, and during the
term of the Agreement will not, without the prior written consent of the other
Party grant any rights to any Third Party that would conflict with the rights
granted to the other Party hereunder;

 

7.1.3            it has the right to grant
the licenses granted or to be granted herein;

 

7.1.4            it is a corporation duly
organised, validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated; and

 

7.1.5            the execution and delivery
of this Agreement and the performance of such Party’s obligations do not
constitute a default or require any consent under any other contractual
obligation of such Party.

 

34

 

7.2           Sankyo hereby warrants and undertakes that at the Commencement Date:

 

7.2.1            it owns absolutely,
co-owns or has the right to licence the Licensed IP and the CNDAC Patent Rights
sufficient to grant the licences granted herein;

 

7.2.2            it has obtained from each
and every inventor of the Licensed Patent Rights an assignment of all rights
such inventors may have in the Licensed Patent Rights and save as otherwise
disclosed to Cyclacel in writing it has not partially assigned, licensed,
mortgaged, charged or otherwise disposed of or encumbered its right, title or
interest in the same;

 

7.2.3            it has disclosed to
Cyclacel all information relating to the Licensed IP and CNDAC Patent Rights
and any therapeutic use of the Candidate which has been generated by Sankyo or
Third Parties, provided that in the case of Third Parties the disclosure of
such information is not prohibited under any confidentiality obligations; and

 

7.2.4            it has disclosed to
Cyclacel the identity of the Third Parties which have generated the information
described in Clause 7.2.3; and

 

7.2.5            it has not granted to any
other party any licence to research, develop or commercialise the Candidate or
CNDAC or any other compound falling within a Valid Claim of the Licensed Patent
Rights or the CNDAC Patent Rights.

 

7.2.6            it has manufactured the “samples
of any capsules in storage”, which is identified in Schedule 2, under GMP
and it had obtained from [*] a statement that [*] has stored the same under
GMP.

 

7.3           Save as is expressly stated in Clause 7.1 or 7.2 NO REPRESENTATION,
CONDITION OR WARRANTY WHATSOEVER IS MADE OR GIVEN, EITHER EXPRESSED OR
IMPLIED, BY OR ON BEHALF OF CYCLACEL OR SANKYO.

 

35

 

THERE
ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, OR THAT THE USE OF THE CANDIDATE WILL NOT INFRINGE ANY
PATENT, COPYRIGHT, TRADEMARK, OR OTHER PROPRIETARY RIGHTS.  ALL CONDITIONS AND WARRANTIES WHETHER
ARISING BY OPERATION OF LAW OR OTHERWISE ARE HEREBY EXPRESSLY EXCLUDED
INCLUDING ANY CONDITIONS AND WARRANTIES TO THE EFFECT THAT ANY OF THE LICENSED
IP IS VALID OR ENFORCEABLE.

 

7.4           Cyclacel shall have the control of and be responsible for all
Clinical Trials conducted in relation to Product after execution of this Agreement including such ongoing Clinical Trials described in Schedule 7
and shall be the sponsor of such trials and in such capacity, shall,
notwithstanding its indemnity rights under Clause 7.5, be responsible for the
initial payment of any compensation due to any participants in such trials who
suffer death or bodily injury pursuant to any legal rights or applicable
industry guidelines.  If it has not already done so prior to the
Commencement Date, Sankyo shall submit to the FDA an
Annual Update,
including Information Amendment, to [*] detailing an extension
to the shelf-life of Product and shall transfer [*] for such ongoing Clinical Trial to Cyclacel.  In the event that the
FDA does not accept an extension to the shelf life of Product for use in such
ongoing Clinical Trials Cyclacel’s obligations hereunder in relation to such
ongoing Clinical Trials shall be suspended until such time as the FDA has accepted the
use of Product in such trials.  Cyclacel (i) shall continue to conduct such ongoing Clinical Trial after the
Commencement Date in
compliance with the Phase I protocol provided by Sankyo, (ii) shall not
amend or alter such protocol and (iii) shall not terminate such ongoing
Clinical Trial at least until the end of December 2003 for ethical reasons
unless otherwise terminated in accordance with the protocol.

 

36

 

7.5           Subject to the provisions of Clause 7.6 Sankyo shall be responsible
for and shall indemnify Cyclacel and its directors, officers, servants and
agents (collectively “the Indemnified Party”) against any and all liability,
loss, damage, cost and expense (including legal costs) incurred or suffered by
the Indemnified Party as a result of a breach of warranty by Sankyo under
Clauses 7.1 or 7.2 or as a result of Sankyo’s activities in relation to the
development of Candidate or Product prior to the Commencement Date of this
Agreement.  An Indemnified Party that
intends to claim indemnification under this Clause 7.5 shall promptly notify
Sankyo of any Third Party claim in respect of which the Indemnified Party
intends to claim that indemnification. 
The Indemnified Party shall not compromise or settle the claim prior to
any such notice.  Sankyo may assume and
control the defence of any such Third Party claim, provided however, that an
Indemnified Party shall have the right to retain its own counsel at its own
cost and expense, if representation of that Indemnified Party by the counsel
retained by Sankyo would be inappropriate due to actual or potential differing
interests between the Indemnified Party and any other party represented by that
counsel in the proceedings.  The
Indemnified Party shall co-operate with Sankyo and its legal representatives in
the investigation of any matter covered by this indemnification.

 

7.6           Cyclacel shall be responsible for and shall indemnify Sankyo and its
Affiliates, directors, officers, servants and agents (collectively “the
Indemnified Party”) against any and all liability, loss, damage, cost and
expense (including legal costs) incurred or suffered by the Indemnified Party
as a result of any claim brought against Sankyo or its Affiliates by a Third
Party which arises

 

7.6.1            as a result of the
activities by Cyclacel or its Affiliates, Cyclacel Licensees, agents or
distributors under this Agreement in relation to the development or
commercialisation of the Product being a claim that use of any Product has
caused death or bodily injury; or

 

37

 

7.6.2            as a result of a breach of
warranty by Cyclacel under Clause 7.1.

 

An Indemnified Party that intends to claim indemnification under this
Clause 7.6 shall promptly notify Cyclacel of any Third Party claim in respect
of which the Indemnified Party intends to claim the indemnification.  The Indemnified Party shall not compromise
or settle the claim prior to any such notice. 
Cyclacel may assume and control the defence of any such Third Party
claim, provided however, that an Indemnified Party shall have the right to
retain its own counsel at its own cost and expense, if representation of that
Indemnified Party by the counsel retained by Cyclacel would be inappropriate
due to actual or potential differing interests between the Indemnified Party
and any other party represented by that counsel in the proceedings.  The Indemnified Party shall co-operate with
Cyclacel and its legal representatives in the investigation of any matter
covered by this indemnification.

 

7.7           Subject to the indemnities in Clauses 7.5 and 7.6 neither Party
shall be liable to the other in contract, tort, negligence, breach of statutory
duty or otherwise for any loss, damage, costs or expenses of any nature
whatsoever incurred or suffered by the other or its Affiliates:

 

7.7.1            of a direct nature where
the same is a loss of turnover, profits, business or goodwill; or

 

7.7.2            an indirect or
consequential nature including any indirect or consequential economic loss or
other indirect or consequential loss of turnover, profits, business or
goodwill.

 

8.             CONFIDENTIALITY

 

8.1           Subject to Clause 8.6, each of the Parties undertakes and agrees to:

 

8.1.1            only use the Confidential
Information for the purposes envisaged under this Agreement and not to use the
same for any other purpose whatsoever;

 

38

 

8.1.2            ensure that only those of their
officers, consultants, employees (including without limitation directors),
sublicensees, Affiliates and such third parties who are directly concerned with
the carrying out of this Agreement have access to the Confidential Information
on a strictly applied “need to know” basis and are informed of the secret and
confidential nature of it;

 

8.1.3            keep the Confidential
Information secret and confidential and not directly or indirectly to disclose
or permit to be disclosed, make available or permit to be made available the
same to any Third Party for any reason without the prior written consent of the
Disclosing Party (except as set out in the Development Plan and then under
equivalent confidentiality provisions);

 

8.1.4            clearly identify the
Confidential Information as confidential.

 

8.2           The obligations of confidentiality referred to in Clause 8.1 shall
not extend to any Confidential Information which:

 

8.2.1            is or becomes generally
available to the public otherwise than by reason of breach by a Recipient Party
of the provisions of that Clause; or

 

8.2.2            is known to the Recipient
Party and is at its free disposal prior to its receipt from the Disclosing
Party in circumstances where the Recipient Party holds evidence that it has not
been derived from access to the Disclosing Party’s Confidential Information; or

 

8.2.3            is mutually agreed in
writing by the Parties to no longer be confidential; or

 

8.2.4            is subsequently disclosed
to the Recipient Party without obligations of confidentiality by a Third Party
owing no such obligations to the Disclosing Party in respect of that
Confidential Information; or

 

39

 

8.2.5            is required by a Legal
Requirement to be disclosed  and then
only (subject to Clause 8.3) when prompt written notice of this requirement has
been given to the Disclosing Party so that it may, if so advised, seek
appropriate relief to prevent such disclosure provided always that in such
circumstances such disclosure shall be only to the extent so required and shall
be subject to prior consultation with the Disclosing Party with a view to
agreeing timing and content of such disclosure.

 

8.3           The requirement under Clause 8.2.5 to notify the Disclosing Party
when Confidential Information is required to be disclosed pursuant to Legal
Requirement shall not apply when such disclosure is required as part of any
regulatory submission or approval process.

 

8.4           All Confidential Information disclosed by the Disclosing Party to
the Recipient Party shall remain the property of the Disclosing Party subject
to the use or disposal of Materials pursuant to the Development Plan.  In the event that a court or Competent
Authority assumes partial or complete control over the assets of a Recipient
Party based on the insolvency or bankruptcy of that Party, the Recipient Party
shall:

 

8.4.1            promptly notify such court
or Competent Authority:

 

(a)       that Confidential Information
received from the Disclosing Party under this Agreement remains the property of
the Disclosing Party; and

 

(b)       of the confidentiality
obligations under this Agreement; and

 

8.4.2            to the extent permitted by
law, take all steps necessary or desirable to maintain the confidentiality and
security of the Disclosing Party’s Confidential Information and to ensure that
the court or Competent Authority maintains that Confidential Information in
confidence in accordance with this Agreement.

 

40

 

8.5           The Parties agree that the obligations of confidentiality set out in
this Clause 8 shall continue to apply following the expiration or termination
of this Agreement for so long as there is Confidential Information which is not
the subject of Clause 8.2.

 

8.6           Sankyo acknowledges and agrees that Cyclacel shall be free to
publish the results arising pursuant to the exercise of its rights and licences
under this Agreement.  Such publication
may also include Licensed Know How comprising data related to the Candidate and
the development thereof provided that Cyclacel shall give Sankyo prior written
notice of any publication containing such Licensed Know How and Sankyo shall
have thirty (30) days to comment upon the same.  Cyclacel shall consider any comments from Sankyo in good faith.  Cyclacel shall be free to publish the
Licensed Know How relating to the Candidate and/or its development following
such thirty (30) day period.

 

8.7           Results published under Clause 8.6, will be considered to be covered
by Clause 8.2.3 in respect of future publications and Clause 8.6 will no longer
apply.

 

9.             TERM AND TERMINATION

 

9.1           This Agreement shall commence on the Commencement Date and shall
continue in force until no payments are due hereunder or until termination
under this Clause 9 whichever is the earlier.

 

9.2           Cyclacel may terminate this Agreement at any time upon six (6)
months’ (upon twelve
(12) months’ if after Product launch) written notice to
Sankyo for technical, scientific, efficacy, safety or commercial reasons.

 

9.3           Cyclacel on the one hand and Sankyo on the other hand (the
“Terminating Party”) shall have the right to terminate this Agreement upon
giving thirty (30) days’ written notice of termination to the other (the “Defaulting
Party”) upon the occurrence of any of the following events at any time during
this Agreement:

 

41

 

9.3.1            the Defaulting Party
committing a material breach of this Agreement which in the case of a breach
capable of remedy shall not have been remedied within thirty (30) days, or
sixty (60) days in case of breach by Cyclacel Licensee as permitted under
Clause 2.3, of the receipt by it of a notice identifying the breach and
requiring its remedy.  The Parties
acknowledge that non-payment of sums due by Cyclacel may amount to a material
breach having regard to the level of non-payment and the reasons given by
Cyclacel for such non-payment.  The
Parties agree that any notification of material breach pursuant to this Clause
9.3 shall be sent to the chief executive officer of the Defaulting Party;

 

9.3.2            if an Insolvency Event
occurs in relation to the Defaulting Party.

 

10.          EFFECTS OF TERMINATION

 

10.1         Upon termination of this Agreement by Sankyo pursuant to Clause 4.2
or Clause 9.3 or by Cyclacel pursuant to Clause 9.2:

 

10.1.1          the licences granted by
Sankyo pursuant to Clause 2 under the Licensed IP, and CNDAC Patent Rights
shall terminate;

 

10.1.2          if Sankyo so requests in
writing, Cyclacel shall immediately deliver up to Sankyo the Licensed IP, CNDAC
Patent Rights and Documents containing or making any reference to the Licensed
IP or CNDAC Patent Rights as soon as reasonably practicable.  Within sixty (60) days of such termination,
the Parties shall negotiate and agree a separate Termination Agreement in
regard to the transfer of ownership and return to Sankyo of all regulatory submissions,
and documents filed with a Regulatory Authority for the Product in the
Territory.  The Parties shall cooperate
in order to provide the appropriate notice and documentation to the Regulatory
Authority for each submission as required by applicable law; and

 

42

 

10.1.3          if Sankyo wishes to obtain
an exclusive licence to the Cyclacel Results it shall so notify Cyclacel and
Cyclacel shall grant to Sankyo an exclusive, worldwide, sub-licensable licence
to the Cyclacel Results the commercial terms of which shall be negotiated in
good faith by the Parties, having regard to the (i) length of time this
Agreement has been in force, (ii) the development efforts expended by Cyclacel,
and (iii) the cause of termination.  In
the event the Parties fail to agree the terms of such licence within sixty (60)
days of the date upon which Cyclacel receives written notice from Sankyo that
it wishes to obtain such a licence, the matter shall be referred to Expert’s
Decision for resolution, whilst such exclusive license shall be temporarily
granted to Sankyo during such period.

 

10.2         In no event shall termination of
this Agreement:

 

(i)      relieve the Parties of any liability arising out of events occurring before
the effective date of such termination.

 

(ii)     affect
the continued operation or enforcement of any provision of this Agreement which
by its express terms is to survive termination.

 

(iii)    release
either Party from the obligation to pay any amounts that become due on or before
the effective date of termination.

 

10.3         Upon termination of this Agreement by Sankyo pursuant to Clause 9.3
and at the request of any Cyclacel Licensee Sankyo shall enter
into a direct licensing arrangement with such Cyclacel Licensee on terms
substantially similar to those contained herein save that any licence granted
by Sankyo to such Cyclacel Licensee shall be consistent with the terms of the
licence granted by Cyclacel in relation to field, territory,
exclusivity/non-exclusivity, whether there is a right to sub-license, and
payment provisions and provided that: (i) such sub-licensee is in good standing
under and in compliance with all material terms and conditions of the
sublicence agreement
and this Agreement; (ii) should Sankyo’s ongoing direct
costs related to such sublicense including but not limited to IP costs under
Clause 6.1, not be fully

 

43

 

reimbursed
by revenue from such sublicensee on an annual basis then Sankyo can require
that such sublicensee reimburse Sankyo’s costs, such reimbursement to be
credited against future revenue payable to Sankyo by such sublicensee; and (iii)
Sankyo’s obligations under such sublicense agreement are no greater than those
under this Agreement.

 

11.          ASSIGNMENT/SUB-CONTRACTING

 

11.1         Neither this Agreement nor any interest hereunder shall be
assignable by either Cyclacel or by Sankyo without the written consent of the
other, such consent not to be unreasonably withheld, provided however that any
Party may assign this Agreement to any corporation with which it may merge or
consolidate, or to which it may transfer all or substantially all of its assets
to which this Agreement relates, subject to obtaining a direct deed of
undertaking from such corporation addressed to the other Parties agreeing to be
bound by all the terms of this Agreement.

 

12.          FORCE MAJEURE

 

12.1         If a Party (the “Affected Party”) is unable to carry out any of its
obligations under this Agreement due to Force Majeure this Agreement shall
remain in effect but the Affected Party’s relevant obligations under this
Agreement and the corresponding obligations of the other Party (“Non-Affected
Party”) under this Agreement, shall be suspended for a period equal to the
circumstance of Force Majeure provided that:

 

12.1.1          the suspension of
performance is of no greater scope than is required by the Force Majeure;

 

12.1.2          the Affected Party
immediately gives the Non-Affected Party prompt written notice describing the
circumstance of Force Majeure, including the nature of the occurrence and its
expected duration, and continues to furnish regular

 

44

 

reports
during the period of Force Majeure and notifies the Non-Affected Party
immediately of the cessation of the Force Majeure;

 

12.1.3          the Affected Party uses all
reasonable efforts to remedy its inability to perform and to mitigate the
effects of the circumstance of Force Majeure; and

 

12.1.4          a soon as practicable after
the event which constitutes Force Majeure the Parties discuss how best to
continue their operations as far as possible in accordance with this Agreement.

 

13.          GOVERNING LAW

 

13.1         The validity, construction and interpretation of this Agreement and
any determination of the performance which it requires shall be governed by the
laws of England.

 

14.          JURISDICTION

 

14.1         In the event of any material dispute concerning rights or
obligations under this Agreement then the Parties shall comply with the
following procedure: the Chief Executive Officer of Cyclacel and the President
of Sankyo or its nominee shall be notified in writing of the dispute by either
Party.  The Chief Executive Officer of
Cyclacel and the President of Sankyo or their nominees shall meet to resolve
the dispute in good faith.  If such
resolution is not reached within sixty (60) days of such written notice, then
the dispute shall be referred to the non-exclusive jurisdiction of the courts
of England and Wales.

 

15.          WAIVER

 

15.1         Save as expressly provided in this Agreement neither Party shall be deemed
to have waived any of its rights or remedies whatsoever unless the waiver is
made in writing, signed by a duly authorised representative of that Party and
may be given subject to

 

45

 

any
conditions thought fit by the grantor. 
Unless otherwise expressly stated any waiver shall be effective only in
the instance and for the purpose for which it is given.

 

15.2         No delay or failure of any Party in exercising or enforcing any of
its rights or remedies whatsoever shall operate as a waiver of those rights or
remedies or so as to preclude or impair the exercise or enforcement of those
rights or remedies.  No single or
partial exercise or enforcement of any right or remedy by any Party shall
preclude or impair any other or further exercise or enforcement of that right
or remedy by that Party.

 

16.          SEVERANCE OF TERMS

 

16.1         If the whole or any part of this Agreement is or becomes or is
declared illegal, invalid or unenforceable in any jurisdiction for any reason (including
both by reason of the provisions of any legislation and also by reason of any
decision of any court or Competent Authority which either has jurisdiction over
this Agreement or has jurisdiction over any of the Parties):

 

16.1.1          in the case of the illegality,
invalidity or un-enforceability of the whole of this Agreement it shall
terminate in relation to the jurisdiction in question; or

 

16.1.2          in the case of the
illegality, invalidity or un-enforceability of part of this Agreement that part
shall be severed from this Agreement in the jurisdiction in question and that
illegality, invalidity or un-enforceability shall not in any way whatsoever
prejudice or affect the remaining parts of this Agreement which shall continue
in full force and effect provided that the said remaining parts continue to
satisfy the commercial intentions of the Parties and provided that the
remaining parts do constitute a substantial part of this Agreement.

 

46

 

17.          ENTIRE AGREEMENT/VARIATIONS

 

17.1         This Agreement constitutes the entire agreement and understanding
between the Parties and supersedes all prior oral or written understandings,
arrangements, representations or agreements between them relating to the
subject matter of this Agreement.  The
Parties acknowledge that no claims shall arise in respect of any
understandings, arrangements, representations or agreements so superseded.  No director, employee or agent of any Party
is authorised to make any representation or warranty to another Party not
contained in this Agreement, and each Party acknowledges that it has not relied
on any such oral or written representations or warranties.  Nothing in this Agreement removes or
overrides any right of action by any Party in respect of any fraudulent
misrepresentation, fraudulent concealment or other fraudulent action.

 

17.2         No variation, amendments, modification or supplement to this
Agreement shall be valid unless agreed in writing in the English language and
signed by a duly authorised representative of each Party.

 

18.          NOTICES

 

18.1         Any notice or other communication given pursuant to or made under or
in connection with the matters contemplated by this Agreement shall be in
writing in the English language and shall be delivered by hand or by courier or
shall be sent by post or recorded delivery to the address of the recipient set
out in Schedule 8 or as specified by the recipient from time to time in accordance
with Clause 18.3.  Notices sent by fax
or E-Mail shall not be valid of themselves and must be confirmed in hard copy
form by hand or by recorded delivery.

 

18.2         Any notice given pursuant to this Clause shall be deemed to have
been received:

 

18.2.1          if delivered by hand or by
courier, at the time of delivery; or

 

18.2.2          if sent by recorded
delivery, at the time of delivery.

 

47

 

18.3         A Party may notify the other Parties to this Agreement of a change
of its name, relevant addressee, address or facsimile number for the purposes
of Schedule 8 provided that such notification shall only be effective on:

 

18.3.1          the date specified in the
notification as the date on which the change is to take place; or

 

18.3.2          if no date is specified or
the date specified is less than five (5) clear Business Days after the date on
which the notice is given, the date falling five (5) clear Business Days after
notice of any such change has been given.

 

18.4         For the avoidance of doubt, the Parties agree that the provisions of
this Clause shall not apply in relation to the service of Service Documents (as
defined in Clause 18.5).

 

18.5         “Service Document” means a writ, summons, order, judgement or other
document related to or in connection with any Court proceeding, cause, matter
or action arising out of or connected in any way with this Agreement.

 

19.          COUNTERPARTS

 

19.1         This Agreement may be executed in any number of counterparts and by
the Parties on separate counterparts, each of which when so executed shall be
an original of this Agreement, and all of which shall together constitute one
and the same instrument.  Complete sets
of counterparts shall be lodged with each Party.

 

20.          THIS AGREEMENT NOT TO CONSTITUTE A PARTNERSHIP

 

20.1         Nothing in this Agreement and no action taken by the Parties
pursuant to this Agreement shall constitute or be deemed to constitute a
partnership, association, joint venture or other co-operative entity between
the Parties and neither Party shall have any authority to bind the other in
any way except as provided in this Agreement.

 

48

 

21.          COSTS

 

21.1         Each Party shall bear its own costs, legal fees and other expenses
incurred in the negotiation, preparation, execution and implementation of this
Agreement and the documents referred to herein unless otherwise set forth in this Agreement.

 

22.          PUBLICITY

 

22.1         No public announcements or other disclosure to third parties
concerning the financial or other terms of this Agreement shall be made,
whether directly or indirectly, by either Party to this Agreement, except as
may be legally required or as may be required for recording purposes, without
first obtaining the approval of the other Party and agreement upon the nature
and text of such announcement or disclosure, with the exception that:

 

22.1.1          a Party may disclose the
full terms of this Agreement to its investment bankers, lawyers, accountants
and other professional advisors or a Third Party seeking to invest in, lend
funds to acquire or merge with or be acquired by such Party without the other
Party’s prior approval provided that such disclosure is made under terms of
confidentiality whether express or implied; and

 

22.1.2          a Party may disclose the
terms of this Agreement to any securities exchange or regulatory authority or
government body to which either Party is subject or submits, wherever situated,
including (without limitation) the US Securities Exchange Commission, the London
Stock Exchange or the Panel on Take-overs and Mergers, if and to the extent
required by the force of law provided that it takes advantage of all provisions
to keep confidential as many terms of this Agreement as possible.

 

22.2         In respect of those public announcements and disclosures not
permitted by Clause 22.1 the Party desiring to make any such public announcement or other
disclosure shall inform the other Party of the proposed announcements or
disclosure in

 

49

 

reasonably
sufficient time prior to public release, and shall provide the other Party with
a written copy thereof, in order to allow such Party to comment upon such
announcement or disclosure, which comments shall be provided by such other
Party within five (5) Business Days.  The
Parties shall jointly develop press releases and information materials that can
be used by either Party for presentations to financial advisers, the UK Stock
Exchange, and similar recipients.

 

IN WITNESS WHEREOF the Parties have executed this Agreement as of the Commencement Date.

 

 

	
  SIGNED by

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of

  	
  )

  	
  Takashi Shoda, President and Representative Director

  
	
  SANKYO CO. LTD.

  	
  )

  	
   

  
	
  Date:

  	
  )

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SIGNED by

  	
  )

  	
   

  	
   

  
	
  for
  and on behalf of

  	
  )

  	
  Spiro
  Rombotis, Chief Executive Officer

  
	
  CYCLACEL LIMITED

  	
  )

  	
   

  
	
  Date:

  	
  )

  	
   

  
					

 

50

 

SCHEDULE 1

DEVELOPMENT PLAN

 

[*]

 

51

 

SCHEDULE 2

LICENSED MATERIALS

 

[*]

 

52

 

[*]

 

53

 

[*]

 

54

 

SCHEDULE 3

LICENSED PATENT RIGHTS

 

Patent Rights owned by Sankyo

 

A.    Licensed
Patent Rights

 

	
  [*] (Crystal of CS-682)

  	
   

  	
  Publication No. WO 02/064609
  A1 (22.08.2002)

  	
   

  	
   

  
	
  Crystal of pyrimidine
  nucleoside derivative 

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Country

  	
   

  	
  Appln. No.

  	
   

  	
  Appln.Date

  	
   

  	
  Patent No.

  	
   

  	
  Patent Date

  	
   

  	
  Expiry Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PCT

  	
   

  	
  [*]

  	
   

  	
  06/02/2002

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Australia

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Brazil

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Canada

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  China

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Colombia

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Czech Republic

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EPC

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Austria,  Belgium,  Switzerland & Liechtenstein,  Cyprus, 
  Germany,  Denmark,  Spain, 
  Finland,  France,  Great Britain,  Greece,  Ireland,  Italy, 
  Luxembourg,  Monaco,  Netherlands,  Portugal,  Sweden,  Turkey,

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Hungary

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Israel

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  India

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Korea

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mexico

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  New Zealand

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Russia

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  U. S. A.

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Japan

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

55

 

B. Licensed Patent Rights

 

	
  [*] (CS-682) 

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Pyrimidine nucleoside
  derivatives having anti-tumor activity, their preparation and use

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Country

  	
   

  	
  Appln. No.

  	
   

  	
  Appln.Date

  	
   

  	
  Patent No.

  	
   

  	
  Patent Date

  	
   

  	
  Expiry Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Australia

  	
   

  	
  [*]

  	
   

  	
  30/09/1992

  	
   

  	
  654212

  	
   

  	
  15/02/1995

  	
   

  	
  [*]

  
	
  Brazil (pipeline)

  	
   

  	
  [*]

  	
   

  	
  13/05/1997

  	
   

  	
  PI 1100621-8

  	
   

  	
  07/12/1999

  	
   

  	
  [*]

  
	
  Canada

  	
   

  	
  [*]

  	
   

  	
  29/09/1992

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  China

  	
   

  	
  [*]

  	
   

  	
  30/09/1992

  	
   

  	
  92113067.8

  	
   

  	
  03/08/1996

  	
   

  	
  [*]

  
	
  Czech Republic

  	
   

  	
  [*]

  	
   

  	
  30/09/1992

  	
   

  	
  289477

  	
   

  	
  29/11/2001

  	
   

  	
  [*]

  
	
  EPC

  	
   

  	
  92308904.9

  	
   

  	
  30/09/1992

  	
   

  	
  0536936

  	
   

  	
  14/08/1996

  	
   

  	
  [*]

  
	
  Austria,   Belgium,  Switzerland & Liechtenstein,  Germany, 
  Denmark,  Spain,  France, 
  Great Britain,  Greece,  Ireland, 
  Italy,  Luxembourg,  Monaco, 
  Netherlands,  Portugal, Sweden

  
	
  Finland

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  105556

  	
   

  	
  15/09/2000

  	
   

  	
  [*]

  
	
  Hong Kong

  	
   

  	
  [*]

  	
   

  	
  2042/96

  	
   

  	
  14/08/1996

  	
   

  	
  [*]

  
	
  Hungary

  	
   

  	
  [*]

  	
   

  	
  30/09/1992

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  Hungary (pipeline)

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  211851

  	
   

  	
  13/08/1996

  	
   

  	
  [*]

  
	
  Indonesia

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  ID0002812

  	
   

  	
  22/06/1998

  	
   

  	
  [*]

  
	
  Israel

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  103301

  	
   

  	
  14/10/1997

  	
   

  	
  [*]

  
	
  Korea

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  255491

  	
   

  	
  15/02/2000

  	
   

  	
  [*]

  
	
  Mexico

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Norway

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  179675

  	
   

  	
  27/11/1996

  	
   

  	
  [*]

  
	
  New Zealand

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  244574

  	
   

  	
  14/06/1994

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Russian Fed.

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  2085557

  	
   

  	
  27/07/1997

  	
   

  	
  [*]

  
	
  Thailand

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  9368

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  Taiwan

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  29/09/2012

  
	
  U. S. A.

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  
	
  U. S. A.

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  5691319

  	
   

  	
  25/11/1997

  	
   

  	
  25/11/2014

  
	
  South Africa

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  Japan

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  2569251

  	
   

  	
  03/10/1996

  	
   

  	
  [*]

  

 

56

 

SCHEDULE 4

CNDAC
PATENT RIGHTS

 

C. CNDAC Patent Rights

 

	
  [*]

  (CNDAC: Active form of CS-682) 

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2002. 8.30

  
	
  Pyrimidine nucleoside derivatives

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Country

  	
   

  	
  Appln. No.

  	
   

  	
  Appln.Date

  	
   

  	
  Patent No.

  	
   

  	
  Patent Date

  	
   

  	
  Expiry Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
   

  	
   

  	
   

  
	
  U. S. A.

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  5616567

  	
   

  	
  01/04/1997

  	
   

  	
  01/04/2014

  
	
  U. S. A.

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  5654420

  	
   

  	
  05/08/1997

  	
   

  	
  05/08/2014

  
	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  	
   

  	
  [*]

  

 

57

 

SCHEDULE 5

SUCCESSFUL COMPLETION CRITERIA

 

[*]

 

58

 

SCHEDULE 6

RETAINED TECHNICAL DATA

 

[*]

 

59

 

[*]

 

60

 

[*]

 

61

 

[*]

 

62

 

[*]

 

63

 

SCHEDULE 7

COMMITTED CLINICAL TRIALS

 

[*]

 

64

 

SCHEDULE 8

ADDRESSES FOR NOTICES

 

Cyclacel

Chief
Executive Officer

Dundee
Technopole

James Lindsay
Place

Dundee DD1 5JJ

UK

Tel: +44 1382
206062

Fax: +44 1382
206067

 

Sankyo Co., Ltd.

Director, Licensing Department

5-1
Nihonbashi-honcho 3-chome,

Chuo-ku, Tokyo
103-8426

JAPAN

Tel: [*]

Fax: [*]

 

65

 

SCHEDULE 9

EXPERT’S DECISION

 

1.               In the event the
Parties fail to agree upon an appropriate level of consideration pursuant to
Clause 10.1.3, the matter shall be determined by an expert (“Expert”) which
Expert shall be suitably qualified to determine that particular matter and who
shall be nominated jointly by the Parties or, failing agreement between the
Parties within twenty (20) business days of a written request by either Party
to the other seeking to initiate the Expert’s decision procedure, either Party may
request the International Chamber of Commerce (Paris) to nominate the Expert.

 

2.               The Parties shall
within fourteen (14) days of the appointment of the Expert file written
submissions setting out their respective view on appropriate levels of
consideration and appropriate accompanying documents.

 

3.               In determining the
matter referred pursuant to Clause 10.1.3 the Expert shall take into account
(i) the length of time this Agreement has been in force, (ii) the development
efforts expended by Cyclacel; and (iii) the cause of termination of the
Agreement.

 

4.               In all cases the
terms of appointment of the Expert by whomsoever appointed shall include:

 

4.1.       a commitment by the Parties
to share equally the Expert’s fee;

 

4.2.       a requirement on the Expert
to act fairly as between the Parties and according to the principles of natural
justice;

 

4.3.       a requirement on the Expert
to hold professional indemnity insurance both then and for three years
following the date of his determination;

 

4.4.       a commitment by the Parties
to supply to the Expert all such assistance, documents and information as he or
she may require for the purpose of his or her determination.

 

4.5.       a commitment by the Parties
that all negotiations connected with the dispute shall be conducted in
confidence and without prejudice to the rights of the

 

66

 

Parties in any future proceedings.

 

5.              The Expert’s decision
shall be final and binding on the Parties (save in the case of negligence or
manifest error).

 

6.              The Parties expressly
acknowledge and agree that they do not intend the reference to the Expert to
constitute an arbitration within the scope of any arbitration legislation, the
Expert’s decision is not a quasi judicial procedure and the Parties shall have
no right of appeal against the Expert’s decision provided always that this
shall not be construed as waiving any rights the Parties might have against the
Expert for breaching his or her terms of appointment or otherwise being
negligent.

 

67

 

 

	
  

  	
    Licensing
  Department

  
	
    SANKYO CO., LTD.

  
	
  3-5-1, Nihonbashi
  Honcho, Chuo-ku, Tokyo, 103-8476, Japan

  
	
  Phone: 81-3-5255-7084, Fax: 81-3-5255-7086

  

 

Spiro Rombotis

Chief
Executive Officer

Cyclacel
Limited

Dundee
Technopole

James Lindsay
Place

Dundee, DD1
5JJ

Scotland,
United Kingdom

 

Re: Amendment
to CS-682 License Agreement

Between Sankyo Co., Ltd. and Cyclacel Limited

 

 

Dear Mr.
Rombotis,

 

As per your request, this letter is to confirm that we have agreed to
amend the CS-682 License Agreement as follows:

 

1.     Clause 2.1.2 of CS-682 License
Agreement is hereby amended by deleting the word “terminable” from that
Clause.  As amended, the said Clause
shall read as follows:

 

2.1.2        a non-exclusive, royalty-free
sub-license under the CNDAC Patent Rights which are licensed with a right to
sub-license by the Professors to Sankyo.

 

2.     Cyclacel agrees to be responsible
for and to indemnify Sankyo and its Affiliates, directors, officers, servants
and agents (collectively “the Indemnified Party”) against any and all
liability, loss, damage, cost and expense (including legal costs) incurred or
suffered by the Indemnified Party as a result of claim brought against Sankyo
or its Affiliates by a Third Party which arises as a result of the activities
by Cyclacel or its Affiliates, Cyclacel Licensees, agents or distributors under
the CS-682 License Agreement in relation to the deletion of “terminable” from
Clause 2.1.2 thereof.

 

3.     Sankyo agrees that in the event
that Cyclacel’s ability to exercise the said sub-license is jeopardized or lost
it will cooperate with Cyclacel, upon Cyclacel’s request and at Cyclacel’s
expenses, in taking any steps which Sankyo considers reasonably required

 

 

to preserve or restore the said sub-license and the rights granted
under the CS-682 License Agreement.

 

4.     Notwithstanding with the items
above, Cyclacel hereby acknowledges that Sankyo does not amend its warranty as
set forth in CS-682 License Agreement with respect to CNDAC Patent Rights.

 

5.     This Amendment supersedes all
prior oral or written understandings, arrangements, representations or
agreements, if any, between the parties relating to the subject matter of this
Amendment to the extent that they conflict with this Amendment.

 

6.     The validity, construction and
interpretation of this Amendment to CS-682 License Agreement and any
determination of the performance which it requires shall be governed by the
laws of England.

 

These
agreements are made in consideration of the mutual covenants contained
herein.  Could you please indicate your
agreement by countersigning at the space indicated below and returning this
agreement to the undersigned.

 

 

	
   

  	
  Sincerely yours and agreed,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Akira Morita

  	
   

  
	
   

  	
  Akira
  Morita

  
	
   

  	
  Corporate
  Officer,

  
	
   

  	
  Director,
  Licensing Department

  
	
   

  	
  Date:

  	
  April 28,
  2004

  	
   

  
	
   

  	
   

  
	
  AGREED:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Spiro Rombotis

  	
   

  	
   

  
	
  Spiro
  Rombotis

  	
   

  
	
  Chief
  Executive Officer

  	
   

  
	
  Date:

  	
  28
  April 2004

  	
   

  	
   

  
							

 

 

	
  

  	
    Licensing
  Department

  
	
    SANKYO CO., LTD.

  
	
  3-5-1, Nihonbashi
  Honcho, Chuo-ku, Tokyo, 103-8476, Japan

  
	
  Phone: 81-3-5255-7084, Fax: 81-3-5255-7086

  

 

1st April, 2004

 

	
  Dr.
  Spiro Rombotis

  	
   

  	
   

  
	
  Chief
  Executive Officer

  	
   

  	
   

  
	
  Cylacel

  	
   

  	
   

  
	
  Dundee
  Technopole

  	
   

  	
   

  
	
  James
  Lindsay Place

  	
   

  	
   

  
	
  Dundee
  DD1 5JJ

  	
   

  	
   

  	
  Tel:
  +44 1382 206062

  
	
  U  K

  	
   

  	
   

  	
  Fax:
  +44 1382 206067

  

 

Re: Territory
of the CS-682 Licensing Agreement

 

Dear Dr.
Rombotis;

 

I am happy to inform you that, in accordance with Clause 2.2.1 of the
CS-682 License Agreement dated 10th September 2003 (the “Agreement”) the
license set out in Clause 2.1 of the Agreement is hereby extended to the
“Excluded Territories” under the same commercial terms as set out in the
Agreement.

 

[*]

 

This letter agreement is to amend the Agreement in accordance with
Clause 17.2 thereof.  Please sign two
copies of this letter agreement and send one copy to us for our record.

 

 

	
   

  	
  Sincerely
  yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
    /s/
  Akira Morita

  	
   

  
	
   

  	
  Akira
  Morita

  
	
   

  	
  Corporate
  Officer,

  
	
   

  	
  Director,
  Licensing Department

  
	
   

  	
   

  
	
  Agreed
  and acknowledged this:

  	
   

  
	
   

  	
   

  
	
    /s/
  Spiro Rombotis

  	
   

  
	
  Spiro
  Rombotis

  
	
  Chief
  Executive Officer

  
	
  Date:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00068-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00068-of-00352.parquet"}]]