Cyclacel board forgoes quarterly 6% convertible preferreds dividend

By Jennifer Chiou

New York, June 26 - The board of Cyclacel Pharmaceuticals, Inc. passed a resolution to forgo declaring the quarterly cash dividend on the company's 6% convertible exchangeable preferred stock, according to an 8-K filing with the Securities and Exchange Commission.

The resolution passed on June 22 and applies to the second-quarter dividend that would have been payable on Aug. 1.

The company added that unpaid dividends are accrued and if it fails to pay an aggregate amount equal to at least six quarterly dividends - whether or not consecutive - on the preferreds, the Cyclacel board will increase by two members.

Holders of the preferreds, voting separately as a class, will have the right to vote to fill the two vacancies until the accrued dividends are paid.

Cyclacel also did not declare a dividend during the first quarter that would have been payable in May.

On June 22, the company also amended an agreement with Scottish Enterprise, under which Scottish Enterprise consented to the reduction of Cyclacel's research operations located in Scotland in exchange for the modification of the repayment terms of a £5 million convertible, non-interest bearing loan.

The company and the agency have agreed to a modified repayment of £1 million, payable in two equal tranches in the third quarter of 2009 and the first quarter of 2010.

Cyclacel is a biopharmaceutical company based in Berkeley Heights, N.J.

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