Document:

exv10w1

Exhibit 10.1

Memorandum of Understanding Between American

International Group, Inc., C.V. Starr & Company, Inc.,

Starr International Company, Inc.,

Maurice R. Greenberg, and Howard I. Smith

          WHEREAS, the parties to this Memorandum of Understanding (the “MOU”) have disputes
pending between them, and

          WHEREAS, the parties to the MOU desire to resolve their disputes, and

          WHEREAS, the parties to the MOU have participated in a mediation before the Honorable
Layn R. Phillips to attempt to resolve those disputes, and Hon. Phillips has recommended that
the parties resolve their disputes according to the terms herein,

          IT IS HEREBY AGREED by and between the undersigned parties to this MOU, that:

          1. All actions by or against American International Group, Inc., and its current and former
officers, directors, partners, members, affiliates, subsidiaries, employees, agents, attorneys,
insurers, representatives, heirs, successors in interest and assigns (collectively, the “AIG
Parties”), on the one hand, and C.V. Starr & Company, Inc., Starr International Company, Inc.
(“SICO”), Maurice R. Greenberg (“Greenberg”) and Howard I. Smith (“Smith”) and their current and
former officers, directors, partners, members, affiliates, subsidiaries, employees, agents,
attorneys, insurers, representatives, heirs, successors in interest and assigns (collectively, the
“Starr Parties”), on the other hand, as well as any claims between the AIG Parties and the Starr
Parties that could have been brought, arising in whole or in part prior to the date of this MOU,
whether asserted or unasserted, are hereby resolved pursuant to the terms set forth below.

          2. As soon as practical after the signing of this MOU, the Starr Parties and the AIG Parties
(the “Parties”) shall undertake to dismiss, with prejudice, all lawsuits and claims they have filed
or asserted against each other, including those that are listed on Exhibit A hereto.

          3. The Starr Parties and the AIG Parties hereby release and forever discharge each other from
any and all claims, debts, demands, rights or causes of action or liabilities whatsoever, known or
unknown, that could have been brought by the Parties as of the date of this MOU. The Starr Parties
further hereby release and forever discharge AIG from any claims, debts, demands, rights or causes
of action or liabilities whatsoever that any of the Starr Parties may have in the future against
AIG for advancement, indemnification or contribution.

 

 

          4. AIG agrees to reimburse Greenberg and Smith’s reasonable legal fees and expenses, not
including any amounts paid in settlement, up to a maximum amount of $150 million, that (a) they
have incurred, (b) in connection with indemnifiable civil matters, and (c) on which they have been
successful (as defined under Delaware law). The parties agree that Hon. Layn R. Phillips will have
sole authority to determine which matters meet these conditions and will oversee a process for
reviewing legal bills and appropriate back-up documentation to determine the reasonableness of the
fees and expenses requested relating to those matters. In the event Greenberg and Smith do not
submit legal fees and expenses meeting these conditions that total $150 million, they shall receive
such lesser amount as Hon. Phillips determines satisfies the conditions. In no event shall
Greenberg and Smith be entitled to receive more than $150 million pursuant to this paragraph.
Greenberg and Smith represent that no other party had an obligation to indemnify them for these
amounts, except with respect to the 2004-2005 D&O insurance tower described below.

          5. AIG will return to Greenberg the property listed on Exhibit B hereto subject to AIG
confirming that it has possession of such items.

          6. AIG will permit Greenberg reasonable access to, and/or copies of, archival materials in
AIG’s possession necessary to write his memoirs, including without limitation trip reports,
memoranda, photographs and other corporate records created while he was an officer or director of
AIG or its predecessors.

          7. The AIG Parties agree not to issue any public statement, or to cause the issuance of any
public statement, disparaging any of the Starr Parties; and the Starr Parties agree not to issue
any public statement, or to cause the issuance of any public statement, disparaging any of the AIG
Parties. The Parties agree that this provision shall not limit the position(s) any of the Parties
may take in any pending or future litigation.

          8. In connection with the resolution of their disputes as set forth herein, AIG and the Starr
Parties shall issue a joint public statement in the form annexed hereto as Exhibit C.

          9. SICO will indemnify AIG for any amounts paid by AIG to the Starr Foundation as damages or
settlement amounts in the action captioned Starr Foundation v. AIG, No. 601380/08 (N.Y. Sup. Ct.,
N.Y. Cty.), and for reasonable legal fees and expenses incurred by AIG in connection with that
action, including appeals, after the date of this MOU.

          10. The Parties agree that they will submit their claims to the 2004-2005 D&O insurance tower
to arbitration before Hon. Daniel Weinstein, who will determine their relative rights to the policy
proceeds.

 

 

          11. The Parties agree that Hon. Layn R. Phillips (and, if he is unable to serve, Hon.
Daniel Weinstein) will have exclusive and binding authority to interpret and resolve any disputes
arising in whole or in part from this MOU.

	 	 	 	 	 
	 
	 	 	 	 
	/s/ Daniel J. Kramer

	 	/s/ David Boies
	 	 
	 

	 	 	 	 
	Daniel J. Kramer

	 	David Boies	 	 
	PAUL, WEISS, RIFKIND, WHARTON

& GARRISON LLP 

1285 Avenue of Americas 

New York, New 10019

On behalf of American International Group, Inc.

	 	BOIES, SCHILLER & FLEXNER LLP 

333 Main Street 

Armonk, New York 10504

On behalf of Maurice R. Greenberg, C. V. 

Starr & Co., Inc, and Starr  International 
Co., Inc.	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	/s/ Vincent A. Sama

	 	 
	 	 
	 	 
	 	 	 
	Vincent A. Sama

	 	 
	 	 
	WINSTON & STRAWN LLP

	 	 
	 	 
	200 Park Avenue 

New York, New York 10166

On behalf of Howard I. Smith
	 	 	 	 

 

 

EXHIBIT A [Actions Which The Parties Will Undertake To Dismiss With Prejudice]1

The Starr Parties will undertake to dismiss with prejudice:

	1.	 	Greenberg v. AIG, No. 09 Civ. 1885 (S.D.N.Y.); and
	 
	2.	 	Starr Int’l Co., Inc. v. AIG,
No. 4021-09 (Juzgado 16 del Primer Circuito Judicial de
Panamá).

The AIG Parties will undertake to dismiss with prejudice:

	1.	 	AIG v. Greenberg, No. 769-VCS (Del. Ch.);
	 
	2.	 	AIG v. Greenberg, No. 600885/08 (N.Y. Sup. Ct., N.Y. Cty.); and
	 
	3.	 	AIG’s claims in In re AIG Deriv. Litig., No. 04 Civ. 8406 (S.D.N.Y.).

The claims in the following case are subject to
Paragraph 11 of this MOU:

	1.	 	Great American Ins. Co. v. AIG, No. 09 Civ. 4476 (S.D.N.Y.).

 

			
	1	 	Certain of the actions listed herein involve claims that AIG does not control
and/or claims brought on behalf of individuals or entities who are not parties to this MOU;
such claims are accordingly not subject to the terms of this MOU.

 

 

EXHIBIT B [Personal Property To Be Returned To Greenberg]

1. Photographs of Mr. Greenberg and Cornelius Vander Starr located in AIG’s Washington, D.C.
office.

2. Photographs of Mr. Greenberg and Chinese leaders in AIG’s Shanghai building.

3. Persian rug previously located in anteroom of board room on 18th floor of 70 Pine Street.

4. Any other materials of a personal nature that are not AIG business records that were located in
AIG facilities at the time of Mr. Greenberg’s retirement and that are still maintained in such
facilities.

 

 

EXHIBIT C [Joint Public Statement]

AIG, Greenberg and Smith Announce Resolution of All Disputes

Agreement between parties ends multiple cases

NEW YORK, NY, November 25, 2009 — American International Group, Inc. (AIG), its former Chairman
Maurice R. “Hank” Greenberg, its former Chief Financial Officer Howard I. Smith, C.V. Starr &
Company, Inc. (“C.V. Starr”), and Starr International Company, Inc. (“SICO”) announced today that
they have entered into an agreement to settle all disputes between AIG, on the one hand, and
Greenberg, Smith, C.V. Starr and SICO, on the other.

Under the terms of the settlement, the parties have agreed to release each other from all claims,
including any claims by Greenberg and Smith against AIG for indemnification of future legal fees
and expenses or settlement costs. The parties have further agreed to submit to an independent third
party Greenberg’s and Smith’s claims for past legal fees and expenses for a determination of which
of those fees (up to a $150 million cap) AIG is legally obligated to pay under AIG’s charter and
by-laws and Delaware law.

     “We are pleased that we have resolved our differences” said Robert Benmosche, AIG’s chief
executive officer. “The resolution of these long-running disputes will remove a significant
distraction and expense and allow AIG to better focus its efforts on paying back taxpayers and
restoring the value of our franchise for the benefit of all our stakeholders.”

     “I too am pleased that these long-running disputes are now over, and I want to express my
appreciation for Bob Benmosche’s help, and the help of the AIG Board, in resolving them. I look
forward to assisting AIG in trying to preserve and restore as much value as possible for all of
AIG’s stakeholders,” said Mr. Greenberg. Mr. Smith concurs with Mr. Greenberg’s statement.

     The details of the settlement are set forth in the November 25, 2009 Memorandum of
Understanding attached to AIG’s Form 8-K filing dated November 25, 2009.Exhibit 4.1

Exhibit 4.1

AMENDED AND RESTATED WARRANT

THE SECURITIES EVIDENCED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE
BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY
BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE DISPOSED
OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
A TRANSACTION WHICH IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.

			
	 	 	 
	 
	 	Original Issue Date: December 10, 2007
	 
	 	Amendment and Restatement Date: November 24, 2009

Warrant to Purchase up to 175,000 shares of Common Stock of Cyclacel Pharmaceuticals, Inc.
(the “Company”).

In consideration for Kingsbridge Capital Limited (the “Investor”) agreeing to enter
into that certain Common Stock Purchase Agreement, dated as of the Original Issue Date, as amended
as of the Amendment and Restatement Date, between the Investor and the Company (the
“Agreement”), the Company hereby agrees that the Investor or any other Warrant Holder (as
defined below) is entitled, on the terms and conditions set forth below, to purchase from the
Company at any time during the Exercise Period (as defined below) up to 175,000 fully paid and
nonassessable shares of common stock, par value $0.001 per share, of the Company (the “Common
Stock”) at the Exercise Price (hereinafter defined), as the same may be adjusted from time to
time pursuant to Section 6 hereof. The resale of the shares of Common Stock or other securities
issuable upon exercise or exchange of this Warrant is subject to the provisions of the Registration
Rights Agreement. Capitalized terms used herein and not otherwise defined shall have the meanings
given them in the Agreement.

This Warrant amends and restates in its entirety that certain Warrant to Purchase up to
175,000 shares of Common Stock of the Company dated December 10, 2007, which is hereby terminated,
cancelled and superseded by this Warrant and shall have no further force or effect whatsoever.

Section 1. Definitions.

“Affiliate” shall mean any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by, or is under direct or indirect common control with
any other Person. For the purposes of this definition, “control,” when used with respect
to any Person, means the power to direct the management and policies of such Person, directly or
indirectly through the ownership of voting securities, and the term “controls” and
“controlled” have meanings correlative to the foregoing.

 

 

 

“Closing Price” as of any particular day shall mean the closing price per share of the
Company’s Common Stock as reported by Bloomberg L.P. on such day.

“Exercise Period” shall mean that period beginning six months after the Original Issue
Date and continuing until (i) the expiration of the five-year period thereafter, or (ii) a Funding
Default, subject in each case to earlier termination in accordance with Section 6 hereof.

“Exercise Price” as of the date hereof shall mean $1.40.

“Funding Default” shall mean a failure by Investor to accept a Draw Down Notice made
by the Company and to acquire and pay for the Shares in accordance therewith within three (3)
Trading Days following the delivery of such Shares to the Investor, provided such Draw Down Notice
was made in accordance with the terms and conditions of the Agreement (including the satisfaction
or waiver of the conditions to the obligation of the Investor to accept a Draw Down set forth in
Article VII of the Agreement), provided further, that such failure was within the control of the
Investor.

“Per Share Warrant Value” shall mean the difference resulting from subtracting the
Exercise Price from the Closing Price on the Trading Day immediately preceding the Exercise Date.

“Person” shall mean an individual, a corporation, a partnership, a limited liability
company, an association, a trust or other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.

“Principal Market” shall mean the NASDAQ Global Select Market, the NASDAQ Global
Market, the NASDAQ Capital Market, the American Stock Exchange or the New York Stock Exchange,
whichever is at the time the principal trading exchange or market for the Common Stock.

“SEC” shall mean the United States Securities and Exchange Commission.

“Trading Day” shall mean any day other than a Saturday or a Sunday on which the
Principal Market is open for trading in equity securities.

“Warrant Holder” shall mean the Investor or any permitted assignee or permitted
transferee of all or any portion of this Warrant.

“Warrant Shares” shall mean those shares of Common Stock received upon exercise of
this Warrant.

 

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Section 2. Exercise.

(a) Method of Exercise. This Warrant may be exercised in whole or in part (but not as
to a fractional share of Common Stock), at any time and from time to time during the Exercise
Period, by the Warrant Holder by surrender of this Warrant, with the form of exercise attached
hereto as Exhibit A completed and duly executed by the Warrant Holder (the “Exercise
Notice”), to the Company at the address set forth in Section 10.4 of the Agreement, accompanied
by payment of the Exercise Price multiplied by the number of shares of Common Stock for which
this Warrant is being exercised (the “Aggregate Exercise Price”). The later of the date on
which an Exercise Notice or payment of the Exercise Price (unless this Warrant is exercised in
accordance with Section 2(c) below) is received by the Company in accordance with this clause
(a) shall be deemed an “Exercise Date.”

(b) Payment of Aggregate Exercise Price. Subject to paragraph (c) below, payment of
the Aggregate Exercise Price shall be made by wire transfer of immediately available funds to an
account designated by the Company. If the amount of the payment received by the Company is less
than the Aggregate Exercise Price, the Warrant Holder will be notified of the deficiency and shall
make payment in that amount within three (3) Trading Days. In the event the payment exceeds the
Aggregate Exercise Price, the Company will refund the excess to the Warrant Holder within five (5)
Trading Days of receipt.

(c) Cashless Exercise. In the event that the Warrant Shares to be received by the
Warrant Holder upon exercise of the Warrant may not be resold pursuant to an effective registration
statement or an exemption to the registration requirements of the Securities Act of 1933, as
amended, and applicable state laws, the Warrant Holder may, as an alternative to payment of the
Aggregate Exercise Price upon exercise in accordance with paragraph (b) above, elect to effect a
cashless exercise by so indicating on the Exercise Notice and including a calculation of the number
of shares of Common Stock to be issued upon such exercise in accordance with the terms hereof (a
“Cashless Exercise”). If a registration statement on Form S-3 under the Securities Act of
1933, as amended, or such other form as deemed appropriate by counsel to the Company for the
registration for the resale by the Warrant Holder of (x) the shares of Common Stock of the Company
that may be purchased under the Agreement, (y) the Warrant Shares, or (z) any securities issued or
issuable with respect to any of the foregoing by way of exchange, stock dividend or stock split or
in connection with a combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise, has been declared effective by the SEC and remains effective, the
Company may, in its sole discretion, permit the Warrant Holder to effect a Cashless Exercise or
require the Warrant Holder to pay the Exercise Price of the Warrant Shares being purchased by the
Warrant Holder under this Warrant. In the event of a Cashless Exercise, the Warrant Holder shall
receive that number of shares of Common Stock determined by (i) multiplying the number of Warrant
Shares for which this Warrant is being exercised by the Per Share Warrant Value and (ii) dividing
the product by the Closing Price on the Trading Day immediately preceding the Exercise Date,
rounded to the nearest whole share. The Company shall cancel the total number of Warrant Shares
equal to the excess of the number of the Warrant Shares for which this Warrant is being exercised
over the number of Warrant Shares to be received by the Warrant Holder pursuant to such Cashless
Exercise.

(d) Replacement Warrant. In the event that the Warrant is not exercised in full, the
number of Warrant Shares shall be reduced by the number of such Warrant Shares for which this
Warrant is exercised, and the Company, at its expense, shall forthwith issue and deliver to or upon
the order of the Warrant Holder a new Warrant of like tenor in the name of the Warrant Holder,
reflecting such adjusted number of Warrant Shares.

 

3

 

Section 3. Ten Percent Limitation. The Warrant Holder may not exercise this Warrant
such that the number of Warrant Shares to be received pursuant to such exercise
aggregated with all other shares of Common Stock then owned by the Warrant Holder beneficially
or deemed beneficially owned by the Warrant Holder would result in the Warrant Holder owning more
than 9.9% of all of such Common Stock as would be outstanding on such Exercise Date, as determined
in accordance with Section 13(d) of the Exchange Act of 1934 and the rules and regulations
promulgated thereunder.

Section 4. Delivery of Warrant Shares.

(a) Subject to the terms and conditions of this Warrant, as soon as practicable after the
exercise of this Warrant in full or in part, and in any event within ten (10) Trading Days
thereafter, the Company at its expense (including, without limitation, the payment by it of any
applicable issue taxes) will cause to be issued in the name of and delivered to the Warrant Holder,
or as the Warrant Holder may lawfully direct, a certificate or certificates for, or make deposit
with the Depositary Trust Company via book-entry of, the number of validly issued, fully paid and
non-assessable Warrant Shares to which the Warrant Holder shall be entitled on such exercise,
together with any other stock or other securities or property (including cash, where applicable) to
which the Warrant Holder is entitled upon such exercise in accordance with the provisions hereof.

(b) This Warrant may not be exercised as to fractional shares of Common Stock. In the event
that the exercise of this Warrant, in full or in part, would result in the issuance of any
fractional share of Common Stock, then in such event the Warrant Holder shall receive the number of
shares rounded down to the nearest whole share.

Section 5. Representations, Warranties and Covenants of the Company.

(a) The Warrant Shares, when issued in accordance with the terms hereof, will be duly
authorized and, when paid for or issued in accordance with the terms hereof, shall be validly
issued, fully paid and non-assessable.

(b) The Company shall take all commercially reasonable action and proceedings as may be
required and permitted by applicable law, rule and regulation for the legal and valid issuance of
this Warrant and the Warrant Shares to the Warrant Holder.

(c) The Company has authorized and reserved for issuance to the Warrant Holder the requisite
number of shares of Common Stock to be issued pursuant to this Warrant. The Company shall at all
times reserve and keep available, solely for issuance and delivery as Warrant Shares hereunder,
such shares of Common Stock as shall from time to time be issuable as Warrant Shares.

(d) From the date hereof through the last date on which this Warrant is exercisable, the
Company shall take all steps commercially reasonable to ensure that the Common Stock remains listed
or quoted on the Principal Market.

 

4

 

Section 6. Adjustment of the Exercise Price. The Exercise Price and, accordingly, the
number of Warrant Shares issuable upon exercise of the Warrant, shall be subject to adjustment from
time to time upon the happening of certain events as follows:

(a) Reclassification, Consolidation, Merger, Mandatory Share Exchange, Sale or
Transfer.

(i) Upon occurrence of any of the events specified in subsection (a)(ii) below (the
“Adjustment Events”) while this Warrant is unexpired and not exercised in full, the Warrant
Holder may in its sole discretion require the Company, or any successor or purchasing corporation,
as the case may be, without payment of any additional consideration therefor, to execute and
deliver to the Warrant Holder a new Warrant providing that the Warrant Holder shall have the right
to exercise such new Warrant (upon terms not less favorable to the Warrant Holder than those then
applicable to this Warrant) and to receive upon such exercise, in lieu of each share of Common
Stock theretofore issuable upon exercise of this Warrant, the kind and amount of shares of stock,
other securities, money or property receivable upon such Adjustment Event by the holder of one
share of Common Stock issuable upon exercise of this Warrant had this Warrant been exercised
immediately prior to such Adjustment Event. Such new Warrant shall provide for adjustments that
shall be as nearly equivalent as may be practicable to the adjustments provided for in this
Section 6.

(ii) The Adjustment Events shall be (1) any reclassification or change of Common Stock (other
than a change in par value, as a result of a subdivision or combination of Common Stock or in
connection with an Excluded Merger or Sale), (2) any consolidation, merger or mandatory share
exchange of the Company with or into another corporation (other than a merger or mandatory share
exchange with another corporation in which the Company is a continuing corporation and which does
not result in any reclassification or change other than a change in par value or as a result of a
subdivision or combination of Common Stock), other than (each of the following referred to as an
“Excluded Merger or Sale”) a transaction involving (A) sale of all or substantially all of
the assets of the Company, (B) any merger, consolidation or similar transaction where the
consideration payable to the shareholders of the Company by the acquiring Person consists
substantially of cash or publicly traded securities, or a combination thereof, or where the
acquiring Person does not agree to assume the obligations of the Company under outstanding warrants
(including this Warrant). In the event of an Excluded Merger or Sale, the Company shall deliver a
notice to the Warrant Holder at least 10 days before the consummation of such Excluded Merger or
Sale, the Warrant Holder may exercise this Warrant at any time before the consummation of such
Excluded Merger or Sale (and such exercise may be made contingent upon the consummation of such
Excluded Merger or Sale), and any portion of this Warrant that has not been exercised before
consummation of such Excluded Merger or Sale shall terminate and expire, and shall no longer be
outstanding.

(b) Subdivision or Combination of Shares. If the Company, at any time while this
Warrant is unexpired and not exercised in full, shall subdivide its Common Stock, the Exercise
Price shall be proportionately reduced as of the effective date of such subdivision, or, if the
Company shall take a record of holders of its Common Stock for the purpose of so subdividing, as of
such record date, whichever is earlier. If the Company, at any time while this Warrant is
unexpired and not exercised in full, shall combine its Common Stock, the Exercise
Price shall be proportionately increased as of the effective date of such combination, or, if
the Company shall take a record of holders of its Common Stock for the purpose of so combining, as
of such record date, whichever is earlier.

 

5

 

(c) Stock Dividends. If the Company, at any time while this Warrant is unexpired and
not exercised in full, shall pay a dividend or other distribution in shares of Common Stock to all
holders of Common Stock, then the Exercise Price shall be adjusted, as of the date the Company
shall take a record of the holders of its Common Stock for the purpose of receiving such dividend
or other distribution (or if no such record is taken, as at the date of such payment or other
distribution), to that price determined by multiplying the Exercise Price in effect immediately
prior to such payment or other distribution by a fraction: (i) the numerator of which shall be the
total number of shares of Common Stock outstanding immediately prior to such dividend or
distribution, and (ii) the denominator of which shall be the total number of shares of Common Stock
outstanding immediately after such dividend or distribution. The provisions of this subsection
(c) shall not apply under any of the circumstances for which an adjustment is provided in
subsections (a) or (b).

(d) Liquidating Dividends, Etc. If the Company, at any time while this Warrant is
unexpired and not exercised in full, makes a distribution of its assets or evidences of
indebtedness to the holders of its Common Stock as a dividend in liquidation or by way of return of
capital or other than as a dividend payable out of earnings or surplus legally available for
dividends under applicable law or any distribution to such holders made in respect of the sale of
all or substantially all of the Company’s assets (other than under the circumstances provided for
in the foregoing subsections (a) through (c)), then the Warrant Holder shall be entitled to receive
upon exercise of this Warrant in addition to the Warrant Shares receivable in connection therewith,
and without payment of any consideration other than the Exercise Price, the kind and amount of such
distribution per share of Common Stock multiplied by the number of Warrant Shares that, on the
record date for such distribution, are issuable upon such exercise of the Warrant (with no further
adjustment being made following any event which causes a subsequent adjustment in the number of
Warrant Shares issuable), and an appropriate provision therefor shall be made a part of any such
distribution. The value of a distribution that is paid in other than cash shall be determined in
good faith by the Board of Directors of the Company. Notwithstanding the foregoing, in the event
of a proposed dividend in liquidation or distribution to the shareholders made in respect of the
sale of all or substantially all of the Company’s assets, the Company shall deliver a notice to the
Warrant Holder at least 10 days before the consummation of such event, the Warrant Holder may
exercise this Warrant at any time before the consummation of such event (and such exercise may be
made contingent upon the consummation of such event), and any portion of this Warrant that has not
been exercised before consummation of such event shall terminate and expire, and shall no longer be
outstanding.

Section 7. Notice of Adjustments. Whenever the Exercise Price or number of Warrant
Shares shall be adjusted pursuant to Section 6 hereof, the Company shall promptly prepare a
certificate signed by its Chief Executive Officer or Chief Financial Officer setting forth in
reasonable detail the event requiring the adjustment, the amount of the adjustment, the method by
which such adjustment was calculated (including a description of the basis on which the Company’s
Board of Directors made any determination hereunder), and the Exercise Price and number of Warrant
Shares purchasable at that Exercise Price after giving effect to such
adjustment, and shall promptly cause copies of such certificate to be sent by overnight
courier to the Warrant Holder.

 

6

 

Section 8. No Impairment. The Company will not, by amendment of its Amended and
Restated Certificate of Incorporation or By-Laws or through any reorganization, transfer of assets,
consolidation, merger, dissolution or issue or sale of securities, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all times in good faith
assist in the carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the Warrant Holder against impairment.
Without limiting the generality of the foregoing, the Company (a) will not increase the par value
of any Warrant Shares above the amount payable therefor on such exercise, and (b) will take all
such action as may be reasonably necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable Warrant Shares on the exercise of this Warrant.

Section 9. Rights As Stockholder. Except as set forth in Section 6 above, prior to
exercise of this Warrant, the Warrant Holder shall not be entitled to any rights as a stockholder
of the Company with respect to the Warrant Shares, including (without limitation) the right to vote
such shares, receive dividends or other distributions thereon or be notified of stockholder
meetings.

Section 10. Replacement of Warrant. Upon receipt of evidence reasonably satisfactory
to the Company of the loss, theft, destruction or mutilation of the Warrant and, in the case of any
such loss, theft or destruction of the Warrant, upon delivery of an indemnity agreement or security
reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation,
on surrender and cancellation of such Warrant, the Company at its expense will execute and deliver,
in lieu thereof, a new Warrant of like tenor.

Section 11. Choice of Law. This Warrant shall be construed under the laws of the
State of New York.

Section 12. Entire Agreement; Amendments. Except for any written instrument
concurrent or subsequent to the date hereof executed by the Company and the Investor, this Warrant
and the Agreement contain the entire understanding of the parties with respect to the matters
covered hereby and thereby. No provision of this Warrant may be waived or amended other than by a
written instrument signed by the party against whom enforcement of any such amendment or waiver is
sought.

Section 13. Restricted Securities.

(a) Registration or Exemption Required. This Warrant has been issued in a transaction
exempt from the registration requirements of the Securities Act of 1933, as amended, in reliance
upon the provisions of Section 4(2) thereof. This Warrant and the Warrant Shares issuable upon
exercise of this Warrant may not be resold except pursuant to an effective registration statement
or an exemption to the registration requirements of the Securities Act of 1933 and applicable state
laws.

 

7

 

(b) Legend. Any replacement Warrants issued pursuant to Section 2 and Section 10
hereof and, unless a registration statement has been declared effective by the SEC in accordance
with the Securities Act of 1933, as amended, with respect thereto, any Warrant Shares issued upon
exercise hereof, shall bear the following legend:

“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY OTHER APPLICABLE
SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION WHICH IS EXEMPT
FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.”

(c) No Other Legend or Stock Transfer Restrictions. No legend other than the one
specified in Section 13(b) has been or shall be placed on the share certificates representing the
Warrant Shares and no instructions or “stop transfer orders” (so called “stock transfer
restrictions”) or other restrictions have been or shall be given to the Company’s transfer
agent with respect thereto other than as expressly set forth in this Section 13.

(d) Assignment. Assuming the conditions of Section 13(a) above regarding registration
or exemption have been satisfied, the Warrant Holder may sell, transfer, assign, pledge or
otherwise dispose of this Warrant (each of the foregoing, a “Transfer”), in whole or in
part, but only to an Affiliate of the Warrant Holder. The Warrant Holder shall deliver a written
notice to Company, substantially in the form of the Assignment attached hereto as
Exhibit B, indicating the person or persons to whom the Warrant shall be Transferred and
the respective number of warrants to be Transferred to each assignee. The Company shall effect the
Transfer within ten (10) days, and shall deliver to the Transferee(s) designated by the Warrant
Holder a Warrant or Warrants of like tenor and terms for the appropriate number of shares. In
connection with and as a condition of any such proposed Transfer, the Company may request the
Warrant Holder to provide an opinion of counsel to the Warrant Holder in form and substance
reasonably satisfactory to the Company to the effect that the proposed Transfer complies with all
applicable federal and state securities laws.

(e) Investor’s Compliance. Nothing in this Section 13 shall affect in any way the
Investor’s obligations under any agreement to comply with all applicable securities laws upon
resale of the Common Stock.

Section 14. Notices. All notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be given in accordance with Section 10.4 of
the Agreement.

 

8

 

Section 15. Miscellaneous. This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party against which
enforcement of such change, waiver, discharge or termination is sought. The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the
terms hereof. The invalidity or unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provision.

Section 16. Company Call Right.

(a) If a Funding Default occurs, the Company shall have the right to demand the surrender of
this Warrant or any remaining portion thereof, Shares and/or cash from the Investor as follows (the
“Call Right”):

(i) If the Investor has not previously exercised this Warrant in full, then the Company shall
have a right to demand the surrender of this Warrant, or remaining portion thereof, from the
Investor without compensation, and the Investor shall promptly surrender this Warrant, or remaining
portion thereof. Following such demand for surrender, this Warrant shall automatically be deemed
to have been canceled and shall have no further force or effect.

(ii) If, prior to receiving a Call Right Notice, the Investor has previously exercised this
Warrant with respect to some or all of the Warrant Shares, and the Investor has not previously sold
such Warrant Shares, then Company shall have a right to purchase from the Investor that number of
shares of Common Stock equal to the number of shares of Common Stock issued in connection with the
exercise(s) of the Warrant, at a repurchase price per share equal to the price per share paid by
the Investor in connection with such exercise(s). For greater certainty, (a) if Warrant Shares
were exercised for cash, the purchase price per share under the Call Right shall be equal to the
Exercise Price, (b) if Warrant Shares were exercised on a cashless exercise basis, the purchase
price per share for such Warrant Shares under the Call Right shall be zero, and (c) if such Warrant
Shares were exercised on both a cash and cashless exercise basis, the purchase price per share
under the Call Right shall be equal to the total amount of cash paid in connection with such cash
exercise(s) divided by the total number of shares of Common Stock issued in connection with all
exercises of the Warrant (whether on a cash or cashless basis).

(iii) If, prior to receiving a Call Right Notice, the Investor has previously exercised this
Warrant with respect to some or all of the Warrant Shares, and the Investor subsequently sold such
Warrant Shares, then the Investor shall remit to the Company the excess, if any, of (x) the
proceeds received by Investor through the sale of such Warrant Shares, over (y) the aggregate
Exercise Price for such Warrant Shares. In the event that the Investor obtained such Warrant
Shares through a Cashless Exercise, then the Investor shall instead remit to the Company all
proceeds received by the Investor through the sale of such Warrant Shares. For the avoidance of
doubt, in the event that the Investor has sold some or all of the Warrant Shares prior to receiving
a Call Right Notice, then the right set forth in this paragraph (iii) shall constitute the sole
Call Right of the Company with respect to such Warrant Shares which have been sold.

 

9

 

(b) Company may exercise the Call Right by delivering a notice (the “Call Right
Notice”) to Investor within thirty (30) days after the occurrence of a Funding Default. On the
tenth (10th) business day following delivery of the Call Right Notice to Investor, Company shall
tender the purchase price, if any, and Investor shall tender shares of Common Stock, if any, to be
sold to Company pursuant to the Call Right Notice, immediately following which Company and Investor
shall consummate such purchase and sale. The Call Right shall survive both the assignment of the
Warrant by the Investor and the disposition of the Warrant Shares by the Investor following
exercise of the Warrant.

(Remainder of page intentionally left blank. Signature page follows.)

 

10

 

IN WITNESS WHEREOF, this Warrant was duly executed by the undersigned, thereunto duly
authorized, as of the date first set forth above.

	 	 	 	 	 
	 	CYCLACEL PHARMACEUTICALS, INC.

 	 
	 	By:  	/s/ Spiro Rombotis
 	 
	 	 	Spiro Rombotis 	 
	 	 	President & Chief Executive Officer 	 

Investor acknowledges and agrees to the terms and conditions of this Warrant.

	 	 	 	 	 
	 	KINGSBRIDGE CAPITAL LIMITED

 	 
	 	By:  	/s/ Antony Gardner-Hilman
 	 
	 	 	Antony Gardner-Hilman 	 
	 	 	Director 	 

 

 

	 	 	 	 	 

EXHIBIT A TO THE WARRANT

EXERCISE FORM

CYCLACEL PHARMACEUTICALS, INC.

The undersigned hereby irrevocably exercises the right to purchase                      shares of
Common Stock of Cyclacel Pharmaceuticals, Inc., a Delaware corporation, evidenced by the attached
Warrant, and (CIRCLE EITHER (i) or (ii)) (i) tenders herewith payment of the Aggregate Exercise
Price with respect to such shares in full, in the amount of $                    , in cash, by certified or
official bank check or by wire transfer for the account of the Company or (ii) elects, pursuant to
Section 2(c) of the Warrant, to convert such Warrant into shares of Common Stock of Cyclacel
Pharmaceuticals, Inc. on a cashless exercise basis, all in accordance with the conditions and
provisions of said Warrant.

The undersigned requests that stock certificates for such Warrant Shares be issued, and a
Warrant representing any unexercised portion hereof be issued, pursuant to this Warrant, in the
name of the registered Warrant Holder and delivered to the undersigned at the address set forth
below.

	 	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	 
	Signature of Registered Holder	 	 
	 
	 	 	 
	Name of Registered Holder (Print)	 	 
	 
	 	 	 
	Address	 	 

 

 

EXHIBIT B TO THE WARRANT

ASSIGNMENT

(To be executed by the registered Warrant Holder desiring to transfer the Warrant)

FOR VALUED RECEIVED, the undersigned Warrant Holder of the attached Warrant hereby sells,
assigns and transfers unto the persons below named the right to purchase                      shares of
Common Stock of Cyclacel Pharmaceuticals, Inc. (the “Company”) evidenced by the attached
Warrant and does hereby irrevocably constitute and appoint                      attorney to transfer the
said Warrant on the books of the Company, with full power of substitution in the premises.

	 	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	 
	Signature	 	 
	 
	 	 	 	 
	Fill in for new Registration of Warrant:	 	 
	 
	 	 	 	 
	 	 	 
	Name	 	 
	 
	 	 	 	 
	 	 	 
	Address	 	 
	 
	 	 	 	 
	 	 	 
	Please print name and address of assignee (including zip code number)

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