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June 24, 1997
BY FACSIMILE - 011 46 18 16 64 58 & FEDERAL EXPRESS
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Xxxxx Xxxxxxxxx, Ph.D.
Vice President, Research & Development
Pharmacia Biotech AB
Xxxxxxxxxx 00
X-000 00 Xxxxxxx
XXXXXX
Re: Third Amendment to Option Agreement and Research Agreement
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Dear Xx. Xxxxxxxxx:
Reference is hereby made to the Option Agreement (the "Option Agreement")
and the Research and Development Agreement (the "Research Agreement"), each
effective as of March 10, 1995, and each as amended by those certain letter
agreements dated as of February 13, 1996 ("Amendment No. 1") and September 23,
1996 ("Amendment No. 2"), by and between ArQule, Inc. ("ArQule") and Pharmacia
Biotech AB ("Pharmacia"). In consideration of the mutual covenants and
agreements hereinafter set forth and other valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the undersigned hereby
acknowledge and agree as follows:
1. In accordance with Section 2.2.1 of the Option Agreement, Pharmacia
hereby confirms to ArQule that, by letter dated April 24, 1997; it has elected
to extend the Option Period for its Option Rights for Subfiled I (as such
capitalized terms are defined in the Option Agreement) through October 30, 1997
in accordance with Section 2.2.1(a) of the Option Agreement. Pharmacia and
ArQule acknowledge that this extension of the Option Period represents the third
and final extension available under the Option Agreement. Pharmacia and ArQule
hereby agree to modify Section 2.3. of the Option Agreement to extend the
Negotiation Period as follows. Pharmacia and ArQule will negotiate in good faith
the terms and conditions of a license agreement for Subfield I not later than
December 31, 1997. In the event that the parties have not executed a license
agreement for Subfield I by December 31, 1997, ArQule shall be free to license
the ArQule Technology in Subfield I to any third party on any terms.
2. The Project Plan shall be amended, in accordance with the terms of the
Research Agreement, by replacing the Research Project (as such capitalized terms
are defined in the Research Agreement) entitled "Research Plan for the Third
Ligand Design Project" attached to Amendment No. 2 with the Research Project
entitled "Research Plan to Develop Prototypical Affinity Chromatography Media
with Synthetic Ligands", a copy of which is
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Xx. Xxxxx Xxxxxxxxx
June 24, 1997
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attached hereto (as so amended, the "Amended Research Project"), for the period
commencing on July 1, 1997 and continuing until December 31, 1997. The parties
acknowledge that the July 1 commencement date is based on a two-month extension
to the Negotiation Period at the conclusion of the second six-month extension to
the Option Period. The parties agree that the Amended Research Project has been
approved by the Research Committee, as required under Section 2.2. of the
Research Agreement.
3. In consideration of the research to be conducted by ArQule as provided
in the Amended Research Project, Pharmacia hereby agrees to pay ArQule $**,
payable on or before July 1, 1997.
Except as otherwise expressly amended by this letter agreement, each of the
terms conditions and provisions of the Option Agreement and the Research
Agreement, as hereto fore amended by Amendment No. 2, shall remain in full force
and effect. This letter agreement may be signed in one or more counterparts,
each of which when taken together shall constitute one and the same instrument.
Very truly yours,
ARQULE, INC.
By: /s/ Xxxx X Xxxxxx
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Xxxx X. Xxxxxx
President and
Chief Executive Officer
Agreed to and Accepted
this 27th day of June, 1997
PHARMACIA BIOTECH AB
By: /s/ Xx. Xxxxx Xxxxxxxxx
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Xx. Xxxxx Xxxxxxxxx
Vice-President
cc: Xxxxxx X. Xxxxx, Chairman, Senior Vice President, and Chief
Scientific Officer
Xxxxxxx X. Xxxxxx, General Counsel
Xxxx Xxxxxxxx, Vice President, Business Department
Xxx Xxxxxxxx, General Counsel
Johan Von Heijne, Manager, Strategic Planning
**Confidential treatment has been requested for the marked portion.
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Research Plan for Third Option Period of the Pharmacia Biotech--
ArQule Collaboration
Effective date for this research plan will be
July 1, 1997 - December 31, 1997.
* *
**Confidential treatment has been requested for the marked portion.
